SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT PURSUANT TO
SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): September 16, 1997
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First Washington Realty Trust, Inc.
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(Exact Name of Registrant as
Specified in Charter)
Maryland 0-25230 52-1879972
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(State or Other (Commission File Number) (IRS Employer
Jurisdiction of Identification No.)
Incorporation)
4350 East-West Highway
Suite 400
Bethesda, Maryland 20814
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(Address of Principal
Executive Offices)
(301) 907-7800
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(Registrant's telephone
number, including area code)
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Item 7. Financial Statements, Pro Forma Financial Statements and Exhibits
(c) Exhibits
1. Underwriting Agreement dated September 16, 1997, which is being filed
pursuant to Regulation S-K, Item 601(b)(1) as an exhibit to the
Registrant's Registration Statement on Form S-3, file no. 333-24017.
5. Opinion of Ballard Spahr Andrews and Ingersoll, which is being filed
pursuant to Regulation S-K, Item 601(b)(5) as an exhibit to the
Registrant's Registration Statement on Form S-3, file no. 333-24017.
8. Opinion of Latham & Watkins, which is being filed pursuant to Regulation
S-K, Item 601(b)(8) as an exhibit to the Registrant's Registration
Statement on Form S-3, file no. 333-24017.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
First Washington Realty Trust, Inc.
By: /s/ Jeffrey S. Distenfeld
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Jeffrey S. Distenfeld
Senior Vice President,
General Counsel
Date: September 19, 1997
Exhibit 1
1,800,000 Shares
FIRST WASHINGTON REALTY TRUST, INC.
(a Maryland corporation)
Common Stock
($.01 Par Value per share)
UNDERWRITING AGREEMENT
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September 16, 1997
BT ALEX. BROWN INCORPORATED
FRIEDMAN, BILLINGS, RAMSEY & CO., INC.
SALOMON BROTHERS INC
TUCKER ANTHONY INCORPORATED
c/o BT Alex. Brown Incorporated
135 East Baltimore Street
Baltimore, Maryland 21202
Ladies and Gentlemen:
First Washington Realty Trust, Inc., a Maryland corporation (the
"Company"), subject to the terms and conditions stated herein, proposes to sell
to the several Underwriters (the "Underwriters") named in Appendix I hereto an
aggregate of 1,800,000 shares of the Company's Common Stock, $.01 par value per
share (the "Firm Shares"). The respective amounts of the Firm Shares to be so
purchased by the several Underwriters are set forth opposite their names in
Appendix I hereto. The Company also proposes to sell at the Underwriters' option
an aggregate of up to 270,000 additional shares of the Company's Common Stock
(the "Optional Shares") as set forth below.
You have advised the Company (a) that you are authorized to enter into this
Agreement and (b) that the several Underwriters are acting severally and not
jointly, to purchase the number of Firm Shares set forth opposite their
respective names in Appendix I, plus their pro rata portion of the Optional
Shares if you elect to exercise the over-allotment option in whole or in part
for the accounts of the several Underwriters. The Firm Shares and the Optional
Shares (to the extent the aforementioned option is exercised) are herein
collectively called the "Shares."
Within 30 days after the closing date, the Company expects to acquire the
seven retail properties set forth in the Prospectus under the caption "Recent
Developments" (the "New Retail Properties" and together with the Company's 41
other properties, the "Properties").
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In consideration of the mutual agreements contained herein and of the
interests of the parties in the transactions contemplated hereby, the parties
hereto agree as follows:
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE OPERATING PARTNERSHIP.
The Company and First Washington Realty Limited Partnership, a Maryland
limited partnership (the "Operating Partnership"), jointly and severally,
represent and warrant to, and agree with, the Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-24017) with respect
to the Shares has been prepared by the Company in conformity with the
requirements of the Securities Act of 1933, as amended (the "Act"), and the
Rules and Regulations (the "Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") thereunder and has been filed with the
Commission. The Company is eligible to use Form S-3 for the registration of the
Shares under the Act. Copies of such registration statement, including any
amendments thereto, the prospectus and the exhibits, financial statements and
schedules, as finally amended and revised, included or incorporated by reference
therein, collectively herein referred to as the "Registration Statement," as
well as copies of the preliminary prospectus supplement, if any, relating to the
offering of the Shares, have heretofore been delivered by the Company to you.
The Registration Statement has been declared effective by the Commission under
the Act, and no post-effective amendment to the Registration Statement has been
filed as of the date of this Agreement. The prospectus constituting a part of
the Registration Statement at the time the Registration Statement was declared
effective by the Commission and the prospectus supplement relating to the
offering of the Shares pursuant to Rule 415 of the Rules and Regulations (the
"Prospectus Supplement"), including all documents incorporated by reference in
the prospectus, as from time to time amended or supplemented pursuant to the
Act, the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or
otherwise, are collectively referred to herein as the "Prospectus." Each
preliminary prospectus supplement related to the offering of the Shares, if any,
is herein referred to as a "Preliminary Prospectus Supplement." Any reference
herein to the Registration Statement or the Prospectus shall be deemed to refer
to and include the documents incorporated by reference therein, as of the date
of such Registration Statement or Prospectus, as the case may be, and, in the
case of any reference herein to any Prospectus, also shall be deemed to include
any documents incorporated by reference therein, and any supplements or
amendments thereto filed with the Commission after the date of filing of the
Prospectus under Rule 424(b) and prior to the termination of the offering of the
Shares by the Underwriters.
(b) The Commission has not issued an order preventing or suspending the use
of any Prospectus relating to the proposed offering of the Shares nor instituted
proceedings for that purpose. The Registration Statement contains and the
Prospectus and any amendments or supplements thereto will contain all statements
which are required to be stated therein by, and will conform, to the
requirements of the Act and the Rules and Regulations. The documents
incorporated by reference in the Prospectus, at the time they were filed or will
be filed with the Commission, conformed or will conform at the time of filing,
in all material respects to the requirements of the Exchange Act or the Act, as
applicable, and the rules and
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regulations of the Commission thereunder. The Registration Statement and any
amendment thereto do not contain, and will not contain, any untrue statement of
a material fact and do not omit, and will not omit, to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading. The Prospectus and any amendments and supplements thereto do not
contain, and will not contain, any untrue statement of material fact; and do not
omit, and will not omit, to state any material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that the Company makes no representations or warranties as to information
contained in or omitted from the Registration Statement or the Prospectus, or
any such amendment or supplement, in reliance upon, and in conformity with,
written information furnished to the Company by or on behalf of any Underwriter,
concerning such Underwriter, specifically for use in the preparation thereof.
(c) The financial statements, together with related notes and schedules
included or incorporated by reference in the Registration Statement, present
fairly the financial position and the results of operations and cash flows of
the respective entity or entities presented therein, at the indicated dates and
for the indicated periods. Such financial statements and related schedules have
been prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved, except as disclosed
therein, and all adjustments necessary for a fair presentation of results for
such periods have been made. The summary financial and statistical data included
or incorporated by reference in the Registration Statement and the Prospectus
present fairly the information shown therein and have been compiled on a basis
consistent with the financial statements presented or incorporated by reference
therein and the books and records of the Company. The pro forma financial
statements and other pro forma financial information included or incorporated by
reference in the Registration Statement and the Prospectus present fairly the
information shown therein, have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial
statements, have been properly compiled on the pro forma bases described
therein, and, in the opinion of the Company, the assumptions used in the
preparation thereof are reasonable and the adjustments used therein are
appropriate to give effect to the transactions or circumstances referred to
therein.
(d) Coopers & Lybrand L.L.P., who have certified certain of the financial
statements filed with the Commission as part of or incorporated by reference in
the Registration Statement, are independent public accountants as required by
the Act and the Rules and Regulations.
(e) Since the respective dates as of which information is given in the
Registration Statement, except as otherwise stated therein, (i) there has been
no material adverse change in or affecting the condition, financial or
otherwise, or in the earnings, business, management, properties, assets, rights,
operations or prospects of the Company, the Operating Partnership, First
Washington Management, Inc. ("FWM"), and the direct and indirect majority owned
subsidiaries of the Company and the Operating Partnership listed on Exhibit 21.1
to the Company's annual report on Form 10-K for the year ended December 31, 1996
(the "10-K") as filed with the Commission (the "Subsidiaries") taken as a whole,
whether or not occurring in the ordinary course of business, and there has not
been any material transaction entered into or
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any material transaction that is probable of being entered into by the Company,
the Operating Partnership, FWM or the Subsidiaries, other than transactions in
the ordinary course of business and changes and transactions described in the
Registration Statement, as it may be amended or supplemented. The Company, the
Operating Partnership, FWM and the Subsidiaries have no material contingent
obligations which are not disclosed in the Company's financial statements which
are included in the Registration Statement.
(f) Each of the Company and the Operating Partnership has all corporate or
partnership power and authority to enter into this Agreement and to perform its
obligations hereunder; and (i) this Agreement has been duly and validly
authorized, executed and delivered by the Company and the Operating Partnership
and (assuming the due authorization, execution and delivery thereof by the
Underwriters) is a valid and binding obligation of each of the Company and the
Operating Partnership, enforceable against them in accordance with its terms;
and (ii) all of the agreements filed (excluding agreements incorporated by
reference from prior Company filings) as exhibits to the Registration Statement
or the 10-K (the "Material Agreements") to which the Company and/or the
Operating Partnership are parties (including by assignment) and each of the
agreements to acquire the New Retail Properties have been duly and validly
authorized, executed and delivered by the parties thereto, and are valid and
binding agreements, enforceable in accordance with their terms, and there are no
dissenters' rights or rights of first refusal or similar rights which have not
been waived with respect to the transfer of any of the New Retail Properties,
partnership interests or assets that are the subject of any Material Agreement;
provided, however, that the enforceability of the documents specified in clauses
(i)-(ii) is subject to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and similar laws, now or hereafter in effect,
affecting creditors' rights and remedies generally and subject, as to
enforceability, to general principles of equity (regardless of whether
enforcement is sought in a proceeding at law or in equity), and except to the
extent that rights to indemnification and contribution hereunder may be limited
by state or federal securities laws or the public policy underlying such laws.
(g) The information set forth under the caption "Capitalization" in the
Prospectus is true and correct; and all of the outstanding shares of capital
stock of the Company have been duly authorized and validly issued and are fully
paid and non-assessable and conform to all statements and descriptions relating
thereto contained in the Registration Statement. Except as disclosed in the
Prospectus, no shares of capital stock of the Company are, or as of the Closing
Date will be, reserved for any purpose. Except as described in the Registration
Statement, there are, and at the Closing Date there will be, no outstanding
securities convertible into or exchangeable for any shares of stock of the
Company and no outstanding options, rights (preemptive or otherwise) or warrants
to purchase or to subscribe for such shares or any other securities of the
Company. Neither the filing of the Registration Statement nor the offering or
sale of the Shares as contemplated by this Agreement gives rise to any rights,
other than those which have been waived or satisfied, for or relating to the
registration of any shares of Common Stock. The Shares have been approved for
listing on the New York Stock Exchange, subject to notice of issuance.
(h) The Shares have been duly authorized and when issued and paid for as
contemplated herein, will be validly issued, fully paid and non-assessable; no
preemptive
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or similar rights of stockholders exist with respect to any of the Shares or the
issue and sale thereof; and the terms of the Shares conform to all statements
and descriptions related thereto contained in the Registration Statement and
comply with all applicable legal requirements (including, without limitation,
federal and state securities laws). The Shares and all other shares of stock of
the Company conform to the provisions of the charter of the Company. The form of
certificates for the Shares conforms to Maryland corporate law. Sections 4.4 and
4.6 of the Charter comply with all applicable legal requirements and are
enforceable in accordance with their terms against holders of shares of stock of
the Company. The units of limited partnership interest issued by the Operating
Partnership ("Units") since its formation, including, without limitation, the
Units issued to the Company, have been duly authorized for issuance by the
Operating Partnership to the holders thereof, and are validly issued and fully
paid. Such Units were offered and sold, and any Units to be issued in connection
with the acquisitions of the New Retail Properties have been offered, in
compliance with all applicable laws (including, without limitation, federal and
state securities laws), and all applicable filings in connection therewith were
made.
(i) Neither the Company, the Operating Partnership, FWM nor any of the
Subsidiaries is or with the giving of notice or lapse of time or both, will be,
in violation of or in default under its charter or bylaws or partnership
agreement or under any agreement, lease, contract, indenture or other instrument
or obligation to which it is a party or by which it, or any of its properties,
is bound and which default would have a material adverse effect on the condition
(financial or otherwise) of the Company, the Operating Partnership, FWM and its
Subsidiaries taken as a whole or the business, management, properties, assets,
rights, operations, condition (financial or otherwise) or prospects of the
Company, the Operating Partnership, FWM and the Subsidiaries taken as a whole
("Material Adverse Effect"). The execution and delivery of this Agreement and
the consummation of the transactions therein contemplated and the fulfillment of
the terms hereof will not conflict with or result in a breach of any of the
terms or provisions of, or constitute a default under, (i) any indenture,
mortgage, deed of trust or other agreement or instrument to which the Company,
the Operating Partnership, FWM or any Subsidiary is a party, (ii) the charter,
bylaws or partnership agreement of the Company, the Operating Partnership, FWM
or any Subsidiary or (iii) any order, rule or regulation applicable to the
Company or any Subsidiary of any court or of any regulatory body or
administrative agency or other governmental body having jurisdiction, except in
the cases of clauses (i) and (iii) above for such conflicts, breaches or
defaults which would not have a Material Adverse Effect.
(j) Each approval, consent, order, authorization, designation, declaration
or filing by or with any regulatory, administrative or other governmental body
necessary in connection with the execution and delivery by the Company and the
Operating Partnership of this Agreement and the consummation of the transactions
herein contemplated (except such additional steps as may be required by the
Commission, the National Association of Securities Dealers, Inc. (the "NASD") or
such additional steps as may be necessary to qualify the Shares for public
offering by the Underwriters under state securities or Blue Sky laws) has been
obtained or made and is in full force and effect.
(k) Each of the Company and FWM is a corporation and the Operating
Partnership is a limited partnership, and each Subsidiary is either a
corporation, limited liability
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company or a limited partnership duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation or organization and
has all requisite corporate, limited liability company or partnership power and
authority to own, lease and operate its properties and conduct its business as
described in the Registration Statement. Each of the Company, FWM, the Operating
Partnership and each Subsidiary is duly qualified or licensed to transact
business as a foreign corporation, limited liability company or partnership, as
applicable, and is in good standing in each jurisdiction in which it owns or
leases properties or in which the conduct of its business requires it to so
qualify or be licensed, except to the extent that the failure to so qualify or
be in good standing would not have a Material Adverse Effect. The outstanding
shares of (i) stock or partnership interests, as the case may be, of each of the
Subsidiaries have been duly authorized and validly issued, are fully paid and
non-assessable and are owned by the Company or the Operating Partnership, and
(ii) capital stock of FWM have been duly authorized and validly issued, are
fully paid and non-assessable and are owned as described in the Registration
Statement; and, with respect to clauses (i) and (ii), except as described in the
Registration Statement, are free and clear of all liens, encumbrances and
equities and claims; and except as described in the Registration Statement, no
options, warrants, or other rights to purchase, agreements or other obligations
to issue or other rights to convert any obligations into shares of stock or
ownership interests in FWM or the Subsidiaries are outstanding.
(l) The Company and the Operating Partnership do not have any subsidiary
companies or interests in any limited liability companies or partnerships except
as set forth in Exhibit 21.1 to the 10-K. The Company is the sole general
partner of the Operating Partnership and on the Closing Date will own a 81.3%
partnership interest therein.
(m) The Company, the Operating Partnership, FWM, and the Subsidiaries have
good and marketable title to all of the properties and assets reflected in the
financial statements (or described in the Registration Statement) hereinabove
described, and, if acquired, will acquire good and marketable title to the New
Retail Properties promptly following the Closing Date, subject to no lien,
mortgage, pledge, security interest, charge or encumbrance of any kind ("Liens")
except as described in the Registration Statement, or which are not material in
amount. Each lease of real property by the Company, the Operating Partnership or
any Subsidiary as lessor is the legal, valid and binding obligation of the
lessee in accordance with the terms of such lease (except that the remedy of
specific performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court before which
any proceeding therefor may be brought and to the Bankruptcy Code of 1978, as
amended (the "Bankruptcy Code")). The rents with respect to the Properties which
as of the date hereof are more than 30 days overdue are not payable under leases
such that, were no further rental payments to be received from such tenants by
the Operating Partnership or Subsidiaries under those leases, there would be a
Material Adverse Effect. The Company has no reason to believe that any tenant
which is responsible for aggregate annual rental payments in excess of $200,000
under all of the leases at the Properties is not financially capable of
performing its obligations thereunder or intends to terminate any of its leases
prior to or upon expiration thereof, either as the rejection of an executory
contract under applicable bankruptcy laws (including the Bankruptcy Code) or
otherwise, except, with respect to each of the foregoing, as set forth in the
Registration Statement. The Company, the Operating Partnership, FWM and the
Subsidiaries occupy their leased properties under valid and binding leases. Each
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of the management and leasing agreements to which FWM is a party (the
"Management Agreements") is in full force and effect, except where the failure
to be in full force and effect would not have a Material Adverse Effect. There
exist no defaults by FWM under any of the Management Agreements or, to the
Company's knowledge, by the other parties thereto that would have a Material
Adverse Effect; and no fees payable thereunder are more than 30 days overdue,
except such amounts which, in the aggregate, would not have a Material Adverse
Effect. The Company has no reason to believe that any party to any Management
Agreement intends to terminate its agreement prior to or upon expiration
thereof, either as the rejection of an executory contract under applicable
bankruptcy laws (including the Bankruptcy Code) or otherwise, except as set
forth in the Registration Statement or except where such termination would not
have a Material Adverse Effect.
(n) The Company, the Operating Partnership, FWM and the Subsidiaries have
filed all federal, state, local and foreign income tax returns which have been
required to be filed, or filed extension requests with respect thereto within
the required time periods, and have paid all taxes indicated by said returns and
all assessments received by them or any of them to the extent that such taxes
have become due (and are not being contested in good faith). All tax liabilities
have been adequately provided for in the financial statements of the Company.
(o) There is no action, suit, claim or proceeding pending or, to the
knowledge of the Company, threatened against the Company, the Operating
Partnership, FWM or any of the Subsidiaries before any court or administrative
agency or otherwise (i) which if determined adversely to the Company, the
Operating Partnership, FWM or any of the Subsidiaries might result in a Material
Adverse Effect or (ii) to prevent the consummation of the transactions
contemplated hereby, except as set forth in the Registration Statement.
(p) The Company qualified as a real estate investment trust ("REIT") under
the Internal Revenue Code of 1986, as amended (the "Code") with respect to its
taxable years ended December 31, 1994, December 31, 1995 and December 31, 1996,
and is organized in conformity with the requirements for qualification as a REIT
under the Code, and it has operated and will continue to operate in such a
manner as to enable it to meet the requirements for taxation as a REIT in the
future; all statements in the Registration Statement regarding the Company's
qualification as a REIT are true, complete and correct in all material respects.
(q) (A) All Liens on or affecting any of the Properties or the assets of
the Company, which are required to be disclosed in the Registration Statement
are disclosed therein; (B) neither any landlord nor any tenant of any of the
Properties is in default under any of the leases pursuant to which any Property
is leased (and the Company does not know of any event which, but for the passage
of time or the giving of notice, or both, would constitute a default under any
of such leases) other than such defaults that would not have a Material Adverse
Effect; (C) no person has an option or right of first refusal to purchase all or
part of any New Retail Properties or any interest therein, (D) each of the
Properties complies with all applicable codes, laws and regulations (including,
without limitation, building and zoning codes, laws and regulations and laws
relating to access to the Properties), except if and to the extent disclosed in
the Registration Statement and except for such failures to comply that would not
have a Material Adverse Effect; (E) there is in effect for the assets of the
Company, the
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Operating Partnership, FWM, the Subsidiaries and the Properties insurance
coverages that are commercially reasonable, and none of the Company, the
Operating Partnership, FWM or any Subsidiary has received from any insurance
company notice of any material defects or deficiencies affecting the
insurability of any such assets; and (F) the Company does not have any knowledge
of any pending or threatened condemnation proceedings, zoning change, or other
similar proceeding or action that will in any material respect affect the size
of, use of, improvements on, construction on or access to the Properties.
(r) Except as disclosed in the Registration Statement, (A) each Property,
including, without limitation, the Environment (as defined below) associated
with such Property, is free of any Hazardous Substance (as defined below),
except for Hazardous Substances that would not have a Material Adverse Effect,
(B) none of the Company, the Operating Partnership, FWM or any Subsidiary has
caused or suffered to occur any Release (as defined below) of any Hazardous
Substance into the Environment on, in, under or from any Property, and no
condition exists on, in, under or, to the knowledge of the Company and the
Operating Partnership, adjacent to any Property that could result in the
incurrence of material liabilities or any material violations of any
Environmental Law (as defined below), give rise to the imposition of any Lien
(as defined below) under any Environmental Law, or, to the Company's knowledge,
cause or constitute a health, safety or environmental hazard to any property,
person or entity which hazard would have a Material Adverse Effect; (C) none of
the Company, the Operating Partnership, FWM or any Subsidiary is engaged in or
intends to engage in any manufacturing or any other operations at the Properties
that (1) require the use, handling, transportation, storage, treatment or
disposal of any Hazardous Substance (other than cleaning solvents and similar
materials and other than insecticides and herbicides that are used in the
ordinary course of operating the Properties and in compliance with all
applicable Environmental Laws) or (2) require permits or are otherwise regulated
pursuant to any Environmental Law; (D) none of the Company, the Operating
Partnership, FWM or any Subsidiary has received any notice of a claim under or
pursuant to any Environmental Law or under common law pertaining to Hazardous
Substances on or originating from any Property; (E) none of the Company, the
Operating Partnership, FWM or any Subsidiary has received any notice from any
Governmental Authority (as defined below) claiming any violation of any
Environmental Law that is uncured or unremediated as of the date hereof; (F) no
Property is included or, to the knowledge of the Company and the Operating
Partnership, proposed for inclusion on the National Priorities List issued
pursuant to CERCLA (as defined below) by the United States Environmental
Protection Agency (the "EPA") or on the Comprehensive Environmental Response,
Compensation, and Liability Information System database maintained by the EPA,
and has not otherwise been identified by the EPA as a potential CERCLA removal,
remedial or response site or included or, to the knowledge of the Company and
the Operating Partnership, proposed for inclusion on, any similar list of
potentially contaminated sites pursuant to any other Environmental Law and (G)
except as disclosed in the environmental reports furnished to the Underwriters,
there are no underground storage tanks located on or in any Property.
As used herein, "Hazardous Substance" shall include, without limitation,
any hazardous substance, hazardous waste, toxic or dangerous substance,
pollutant, solid waste or similarly designated materials, including, without
limitation, oil, petroleum or any petroleum-derived substance or waste, asbestos
or asbestos-containing materials, PCBs, pesticides,
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explosives, radioactive materials, dioxins, urea formaldehyde insulation or any
constituent of any such substance, pollutant or waste, including any such
substance, pollutant or waste identified or regulated under any Environmental
Law (including, without limitation, materials listed in the United States
Department of Transportation Optional Hazardous Material Table, 49 C.F.R. ss.
172.101, as currently in effect, or in the EPA's List of Hazardous Substances
and Reportable Quantities, 40 C.F.R. Part 302, as currently in effect);
"Environment" shall mean any surface water, drinking water, ground water, land
surface, subsurface strata, river sediment, buildings, structures, and ambient,
workplace and indoor air; "Environmental Law" shall mean the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended (42
U.S.C. ss. 9601 et seq.) ("CERCLA"), the Resource Conservation and Recovery Act
of 1976, as amended (42 U.S.C. ss. 6901, et seq.), the Clean Air Act, as amended
(42 U.S.C. ss. 7401, et seq.), the Clean Water Act, as amended (33 U.S.C. ss.
1251, et seq.), the Toxic Substances Control Act, as amended (15 U.S.C. ss.
2601, et seq.), the Occupational Safety and Health Act of 1970, as amended (29
U.S.C. ss. 651, et seq.), the Hazardous Materials Transportation Act, as amended
(49 U.S.C. ss. 1801, et seq.), and all other applicable federal, state and local
laws, ordinances, regulations, rules, orders, decisions and permits relating to
the protection of the environment or of human health from environmental effects;
"Governmental Authority" shall mean any applicable federal, state or local
governmental office, agency or authority having the duty or authority to
promulgate, implement or enforce any Environmental Law; for purposes of this
paragraph (s), "Lien" shall mean, with respect to any Property, any mortgage,
deed of trust, pledge, security interest, lien, encumbrance, penalty, fine,
charge, assessment, judgment or other liability in, on or affecting such
Property; and "Release" shall mean any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, dumping,
emanating or disposing of any Hazardous Substance into the Environment,
including, without limitation, the abandonment or discard of barrels,
containers, tanks (including, without limitation, underground storage tanks) or
other receptacles containing or previously containing any Hazardous Substance or
any release, emission, discharge or similar term, as those terms are defined or
used in any applicable Environmental Law.
(s) None of the Company, the Operating Partnership, FWM or any of the
Subsidiaries is, or after giving effect to the issuance and sale of the Shares
by the Company will be, (i) an "investment company" or a company "controlled" by
an "investment company" within the meaning of the Investment Company Act of
1940, as amended (the "Investment Company Act"), or (ii) a "holding company" or
a "subsidiary company" of a "registered holding company," as defined in the
Public Utility Holding Company Act of 1938, as amended.
(t) Neither the Company, nor to the Company's best knowledge, any of its
affiliates, has taken or may take, directly or indirectly, any action designed
to cause or result in, or which has constituted or which might reasonably be
expected to constitute, the stabilization or manipulation of the price of the
shares of Common Stock to facilitate the sale or resale of the Shares.
(u) The Company, the Operating Partnership, FWM and each of the
Subsidiaries holds all material licenses, certificates and permits from
governmental authorities which are necessary to the conduct of their businesses
except for such as the absence of which would not have a Material Adverse
Effect; and none of the Company, the Operating Partnership,
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FWM or any of the Subsidiaries has infringed any patents, patent rights, trade
names, trademarks or copyrights, which infringement is material to the business
of the Company, the Operating Partnership, FWM and the Subsidiaries taken as a
whole. The Company knows of no material infringement by others of patents,
patent rights, trade names, trademarks or copyrights owned by or licensed to the
Company, the Operating Partnership, FWM or any Subsidiary which would have a
Material Adverse Effect.
(v) No statement, representation, warranty or covenant made by the Company
or the Operating Partnership in any certificate or document required by this
Agreement to be delivered to the Underwriters was or will be, when made,
inaccurate, untrue or incorrect in any material respect.
(w) Each of the Company, the Operating Partnership and FWM is in compliance
in all material respects with all presently applicable provisions of the
Employee Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder ("ERISA"); no "reportable
event" (as defined in ERISA) has occurred with respect to any "pension plan" (as
defined in ERISA) for which any of the Company, the Operating Partnership or FWM
would have any liability; none of the Company, the Operating Partnership or FWM
has incurred or expects to incur liability under (i) Title IV of ERISA with
respect to termination of, or withdrawal from, any "pension plan" or (ii)
Sections 412 or 4971 of the Internal Revenue Code of 1986, as amended, including
the regulations and published interpretations thereunder (the "Code"); and each
"pension plan" for which the Company, the Operating Partnership or FWM would
have any liability that is intended to be qualified under Section 401(a) of the
Code is so qualified in all material respects and nothing has occurred, whether
by action or by failure to act, which could cause the loss of such
qualification.
(x) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are executed
in accordance with management's general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(y) Neither the Company nor any of its directors, officers or controlling
persons has taken or will take, directly or indirectly, any action resulting in
a violation of Regulation M under the Exchange Act, or designed to cause or
result in, or that has constituted or that might constitute, the stabilization
or manipulation of the price of any security of the Company to facilitate the
sale or resale of the Shares.
2. PURCHASE, SALE AND DELIVERY OF THE FIRM SHARES.
(a) On the basis of the representations, warranties, covenants and
agreements herein contained, and subject to the terms and conditions herein set
forth, the Company agrees to sell to the Underwriters and each Underwriter
agrees, severally and not
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jointly, to purchase, at a price of $22.74 per share, the number of Firm Shares
set forth opposite the name of each Underwriter in Appendix I hereof, subject to
adjustments in accordance with Section 9 hereof.
(b) Payment for the Firm Shares to be sold hereunder is to be made in
Federal funds or by certified or bank cashier's checks drawn to the order of the
Company against delivery of certificates therefor to the Underwriters for the
several accounts of the Underwriters. Such payment and delivery are to be made
at the offices of Hogan & Hartson L.L.P., 555 Thirteenth Street, N.W.,
Washington, D.C. 20004, at 9:00 a.m., local time, on the third business day
after the date of this Agreement or at such other time and date not later than
five business days thereafter as you and the Company shall agree upon, such time
and date being herein referred to as the "Closing Date." (As used herein,
"business day" means a day on which the New York Stock Exchange is open for
trading and on which banks in New York are open for business and are not
permitted by law or executive order to be closed.) The certificates for the Firm
Shares will be delivered in such denominations and in such registrations as the
Underwriters request in writing not later than the second full business day
prior to the Closing Date, and will be made available for inspection by the
Underwriters at least one business day prior to the Closing Date.
(c) In addition, on the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the Company
hereby grants an option to the several Underwriters to purchase the Optional
Shares at the price per share as set forth in the first paragraph of this
Section 2. The option granted hereby may be exercised in whole or in part by
giving written notice (i) at any time before the Closing Date and (ii) only once
thereafter within 30 days after the date of this Agreement, by the Underwriters
to the Company setting forth the number of Optional Shares as to which the
several Underwriters are exercising the option, the names and denominations in
which the Optional Shares are to be registered and the time and date at which
such certificates are to be delivered. The time and date at which certificates
for Optional Shares are to be delivered shall be determined by the Underwriters
but shall not be earlier than three nor later than 10 full business days after
the exercise of such option, nor in any event prior to the Closing Date (such
time and date being herein referred to as the "Option Closing Date"). If the
date of exercise of the option is three or more days before the Closing Date,
the notice of exercise shall set the Closing Date as the Option Closing Date.
The number of Optional Shares to be purchased by each Underwriter shall be in
the same proportion to the total number of Optional Shares being purchased as
the number of Firm Shares being purchased by such Underwriters bears to
1,800,000 adjusted by you in such manner as to avoid fractional shares. The
option with respect to the Optional Shares granted hereunder may be exercised
only to cover over-allotments in the sale of the Firm Shares by the
Underwriters. The Underwriters may cancel the option at any time prior to its
expiration by giving written notice of such cancellation to the Company. To the
extent, if any, that the option is exercised, payment for the Optional Shares
shall be made on the Option Closing Date in Federal funds or by certified or
bank cashier's check drawn to the order of the Company against delivery of
certificates therefor at the offices of BT Alex. Brown Incorporated, 135 East
Baltimore Street, Baltimore, Maryland.
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<PAGE>
3. OFFERING BY THE UNDERWRITERS.
It is understood that the several Underwriters are to make a public
offering of the Firm Shares as soon as they deem it advisable to do so. The Firm
Shares are to be initially offered to the public at the initial public offering
price set forth in the Prospectus. The Underwriters may from time to time
thereafter change the public offering price and other selling terms. To the
extent, if at all, that any Optional Shares are purchased pursuant to Section 2
hereof, the Underwriters will offer them to the public on the foregoing terms.
It is further understood that you will act as the Underwriters in the
offering and sale of the Shares in accordance with an Agreement Among
Underwriters entered into by you.
4. COVENANTS OF THE COMPANY AND THE OPERATING PARTNERSHIP.
The Company and the Operating Partnership each hereby covenants and agrees
with the Underwriters as follows:
(a) The Company will (i) prepare and timely file with the Commission under
Rule 424(b) of the Rules and Regulations a Prospectus Supplement containing
information previously omitted at the time of effectiveness of the Registration
Statement, (ii) prior to the termination of the offering of the Shares by the
Underwriters, not file any amendment to the Registration Statement or supplement
to the Prospectus or document incorporated by reference therein of which the
Underwriters shall not previously have been advised and furnished with a copy or
to which the Underwriters shall have reasonably objected in writing or which is
not in compliance with the Rules and Regulations, and (iii) file on a timely
basis all reports and any definitive proxy or information statements required to
be filed by the Company with the Commission subsequent to the date of the
Prospectus and prior to the termination of the offering of the Shares by the
Underwriters.
(b) The Company will advise the Underwriters promptly (i) when the
Registration Statement or any post-effective amendment thereto shall have become
effective, (ii) of the receipt of any comments from the Commission, and (iii) of
any request of the Commission for amendment of the Registration Statement or for
supplement to the Prospectus or for any additional information, and (iv) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or the use of the Prospectus or of the institution of any
proceedings for that purpose. The Company will use its best efforts to prevent
the issuance of any such stop order preventing or suspending the use of the
Prospectus and to obtain as soon as possible the lifting thereof, if issued.
(c) The Company will cooperate with the Underwriters in endeavoring to
qualify the Shares for sale under the securities laws of such jurisdictions as
the Underwriters may reasonably have designated in writing and will make such
applications, file such documents, and furnish such information as may be
reasonably required for that purpose, provided the Company shall not be required
to qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction where it is not now so qualified or
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<PAGE>
required to file such a consent. The Company will, from time to time, prepare
and file such statements, reports, and other documents, as are or may be
required to continue such qualifications in effect for so long a period as the
Underwriters may reasonably request for distribution of the Shares.
(d) The Company will deliver to, or upon the order of, the Underwriters,
from time to time, as many copies of any Preliminary Prospectus as the
Representatives may reasonably request. The Company will deliver to, or upon the
order of, the Underwriters during the period when delivery of a Prospectus is
required under the Act, as many copies of the Prospectus in final form, or as
thereafter amended or supplemented, as the Underwriters may reasonably request.
The Company will deliver to the Underwriters at or before the Closing Date, five
signed copies of the Registration Statement and all amendments thereto including
all exhibits filed therewith, and will deliver to the Underwriters such number
of copies of the Registration Statement (including such number of copies of the
exhibits filed therewith that may reasonably be requested), and of all
amendments thereto, as the Underwriters may reasonably request.
(e) The Company will comply with the Act and the Rules and Regulations, and
the Securities and Exchange Act of 1934 (the "Exchange Act") and the rules and
regulations of the Commission thereunder, so as to permit the completion of the
distribution of the shares as contemplated by this Agreement and the Prospectus.
If during the period in which a prospectus is required by law to be delivered by
an Underwriter or dealer any event shall occur as a result of which, in the
judgment of the Company or in the reasonable opinion of the Underwriters, it
becomes necessary to amend or supplement the Prospectus to make the statements
therein, in the light of the circumstances existing at the time the Prospectus
is delivered to a purchaser, not misleading, or, if it is necessary at any time
to amend or supplement the Prospectus to comply with any law, the Company
promptly will either (i) prepare and file with the Commission an appropriate
amendment to the Registration Statement or supplement to the Prospectus (ii)
prepare and file with the Commission an appropriate filing under the Exchange
Act which shall be incorporated by reference in the Prospectus so that the
Prospectus as so amended or supplemented will not, in the light of the
circumstances when it is so delivered, be misleading, or so that the Prospectus
will comply with applicable law.
(f) The Company will make generally available to its security holders, as
soon as it is practicable to do so, but in any event not later than 15 months
after the effective date of the Registration Statement, an earning statement
(which need not be audited) in reasonable detail, covering a period of at least
12 consecutive months beginning after the effective date of the Registration
Statement, which earning statement shall satisfy the requirements of Section
11(a) of the Act and Rule 158 of the Rules and Regulations.
(g) The Company will, for a period of five years from the Closing Date,
deliver to the Underwriters copies of annual reports and copies of all other
documents, reports and information furnished by the Company to its
securityholders or filed with any securities exchange pursuant to the
requirements of such exchange or with the Commission pursuant to the Act or the
Exchange Act. The Company will, upon request, deliver to the Underwriters
similar reports with respect to significant subsidiaries, as that term is
defined in the Rules and Regulations, which are not consolidated in the
Company's financial statements.
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<PAGE>
(h) No offering, sale, short sale or other disposition of any shares of
Common Stock of the Company or other securities convertible into or exchangeable
or exercisable for shares of Common Stock or derivative of Common Stock (or
agreement for such) will be made for a period of 90 days after the date of this
Agreement, directly or indirectly, by the Company otherwise than hereunder or
with the prior written consent of BT Alex. Brown Incorporated, except that the
Company may, without such consent, (i) grant options and issue shares upon the
exercise of options issued pursuant to the Company's employee benefit plans,
(ii) issue Shares or Units in acquisition transactions, (iii) issue shares in
exchange for Common Units and Exchangeable Preferred Units of the Operating
Partnership (as defined in the Prospectus) or upon conversion of the FS Note or
exchange of the Exchangeable Debentures, or (iv) issue shares in accordance with
any dividend reinvestment plan instituted by the Company or as consideration for
future acquisitions.
(i) The Company will use its best efforts to list, subject to notice of
issuance, the Shares on the New York Stock Exchange.
(j) The Company shall apply the net proceeds from the sale of the Shares as
set forth under "Use of Proceeds" in the Prospectus.
(l) The Company has caused each officer and director of the Company to
furnish to you, on or prior to the date of this Agreement, a letter or letters,
in form and substance satisfactory to the Underwriters, pursuant to which each
such person shall agree not to offer, sell, short or otherwise dispose of any
shares of Common Stock of the Company or other capital stock of the Company, or
any other securities convertible, exchangeable (including Units) or exercisable
for Common Shares or derivative of Common Shares owned by such person or request
the registration for the offer or sale of any of the foregoing (or as to which
such person has the right to direct the disposition of) for a period of 90 days
after the date of this Agreement, directly or indirectly, except with the prior
written consent of BT Alex. Brown Incorporated ("Lock-Up Agreements").
(m) The Company will not invest, reinvest or otherwise use the proceeds
received by the Company from the sale of the Shares in such a manner, or take
any action, that would cause the Company or the Operating Partnership to become
an "investment company," as that term is defined in the Investment Company Act.
(n) The Company will maintain a transfer agent and, if necessary under the
jurisdiction of incorporation of the Company, a registrar for the Common Stock.
(o) The Company will not take, directly or indirectly, any action designed
to cause or result in, or that has constituted or might reasonably be expected
to constitute, the stabilization or manipulation of the price of any securities
of the Company.
(p) The Company will use its best efforts to continue to meet the
requirements to qualify as a REIT under the Code.
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<PAGE>
5. COSTS AND EXPENSES.
The Company and the Operating Partnership will pay all costs, expenses and
fees incident to the performance of the obligations of the Company and the
Operating Partnership under this Agreement, including, without limiting the
generality of the foregoing, the following: accounting fees of the Company; the
fees and disbursements of counsel for the Company; the cost of printing and
delivering to, or as requested by, the Underwriters copies of the Registration
Statement, Preliminary Prospectuses, the Prospectus, this Agreement, the
Underwriters' Invitation Letter, the Blue Sky Survey and any supplements or
amendments thereto; the filing fees of the Commission; the filing fees and
expenses (including legal fees and disbursements) incident to securing any
required review by the National Association of Securities Dealers, Inc. (the
"NASD") of the terms of the sale of the Shares; the Listing Fee of the New York
Stock Exchange; and the expenses, including the fees and disbursements of
counsel for the Underwriters, incurred in connection with the qualification of
the Shares under State securities or Blue Sky laws. The Company shall not,
however, be required to pay for any of the Underwriters' expenses (other than
those related to qualification under NASD regulation and State securities or
Blue Sky laws) except that, if this Agreement shall not be consummated because
the conditions in Section 6 hereof are not satisfied, or because this Agreement
is terminated by the Underwriters pursuant to Section 11 hereof, or by reason of
any failure, refusal or inability on the part of the Company to perform any
undertaking or satisfy any condition of this Agreement or to comply with any of
the terms hereof on its part to be performed, unless such failure to satisfy
said condition or to comply with said terms be due to the default or omission of
any Underwriter, then the Company and the Operating Partnership shall reimburse
the several Underwriters for reasonable out-of-pocket expenses, including fees
and disbursements of counsel, reasonably incurred in connection with
investigating, marketing and proposing to market the Shares or in contemplation
of performing their obligations hereunder; but the Company and the Operating
Partnership shall not in any event be liable to any of the several Underwriters
for damages on account of loss of anticipated profits from the sale by them of
the Shares.
6. CONDITIONS OF OBLIGATIONS OF THE UNDERWRITERS.
The several obligations of the Underwriters to purchase the Firm Shares on
the Closing Date and the Option Shares, if any, on the Option Closing Date are
subject to the accuracy, as of the Closing Date or the Option Closing Date, as
the case may be, of the representations and warranties of the Company and the
Operating Partnership contained herein, and to the performance by them of their
covenants and obligations hereunder and to the following additional conclusions:
(a) The Registration Statement and all post-effective amendments thereto
shall have become effective and any and all filings required by Rule 424 and
Rule 430A of the Rules and Regulations shall have been made, and any request of
the Commission for additional information (to be included in the Registration
Statement or otherwise) shall have been disclosed to the Underwriters and
complied with to their reasonable satisfaction. No stop order suspending the
effectiveness of the Registration Statement, as amended from time to time, shall
have been issued and no proceedings for that purpose shall have been taken or,
to the
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<PAGE>
knowledge of the Company, shall be contemplated by the Commission and no
injunction, restraining order or order of any nature by a Federal or state court
of competent, jurisdiction shall have been issued as of the Closing Date which
would prevent the issuance of the Shares.
(b) The Underwriters shall have received an opinion, dated the Closing Date
and any Option Closing Date and satisfactory in form and substance to the
Underwriters (and stating that it may be relied upon by counsel to the
Underwriters), from Latham & Watkins, counsel to FWM, the Company and the
Operating Partnership, to the effect that:
(i) The Registration Statement has become effective under the Act and,
to the knowledge of such counsel, no stop order proceedings with respect
thereto have been instituted or are pending or threatened under the Act.
(ii) The Registration Statement, the Prospectus and each amendment or
supplement thereto and each document incorporated by reference therein
comply as to form in all material respects with the requirements of the Act
(or the Exchange Act, as applicable) and the applicable rules and
regulations thereunder (except that such counsel need express no opinion as
to the financial statements, notes and related schedules thereto included
therein).
(iii) Such counsel does not know of any contracts or documents
required to be filed as exhibits to or incorporated by reference in the
Registration Statement or described in the Registration Statement or the
Prospectus which are not so filed, incorporated by reference or described
as required.
(iv) FWM has been duly incorporated and is validly existing and in
good standing under the laws of the District of Columbia, with corporate
power and authority to own, lease and operate its properties, and to
conduct its business as described in the Prospectus. The outstanding shares
of preferred stock of FWM are duly authorized and validly issued, are fully
paid and non-assessable, and are owned as described in the Prospectus. The
promissory notes of FWM (the "FWM Notes") are duly authorized and validly
issued by FWM and are legally valid and binding obligations of FWM, and
enforceable against FWM in accordance with their terms. This opinion does
not include any opinion with respect to the perfection or priority of any
security interest or lien, and is further subject to the following
limitations, qualifications and exceptions: (a) the effect of bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to or affecting the rights or remedies of
creditors, (b) enforceability of the FWM Notes is subject to the effect of
general principles of equity, whether considered in a proceeding in equity
or at law, and the discretion of the court before which any proceeding
therefor may be brought, (c) the unenforceability under certain
circumstances under law or court decisions of provisions providing for the
indemnification of or contribution to a party with respect to a liability
where such indemnification or contribution is contrary to public policy,
and (d) the unenforceability of any provision requiring the payment of
attorney's fees, except to the extent that a court determines such fees to
be reasonable.
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(v) Based solely on certificates from public officials, we confirm
that (a) FWM is qualified to do business in the following jurisdictions:
Delaware, District of Columbia, Illinois, Maryland, North Carolina,
Pennsylvania, South Carolina and Virginia; (b) the Company is qualified to
do business in the District of Columbia; (c) the Operating Partnership is
qualified to do business in the following jurisdictions: District of
Columbia, Maryland, North Carolina, Pennsylvania, South Carolina and
Virginia; and (d) JFD Limited Partnership, a Maryland limited partnership,
is qualified to do business in South Carolina, Delaware and Virginia.
(vi) The statements set forth in the Prospectus under the caption
"Certain Federal Income Tax Considerations to the Company of its REIT
Election" and in the Prospectus Supplement under the caption "Certain
Federal Income Tax Considerations to Holders of Common Stock" insofar as
such statements constitute matters of law, summaries of legal matters or
legal conclusions, including, without limitation, with respect to federal
tax consequences that are likely to be material to purchasers of the
Shares, and the description in the Registration Statement of the Material
Agreements have been reviewed by us and are accurate in all material
respects and with respect to the information under "Certain Federal Income
Tax Considerations to the Company of its REIT Election" and Certain Federal
Income Tax Considerations to Holders of Common Stock," fairly summarizes
the federal income tax considerations that are likely to be material to
purchasers of the Shares.
(vii) The execution and delivery of this Agreement and the
consummation of the transactions herein contemplated do not and will not
conflict with or constitute a breach of, or default under, any of the
Material Agreements (excluding the Company's charter and bylaws) to which
any of the Company, the Operating Partnership, FWM or any Subsidiary (the
"FWM Entities") is a party or by which any of the FWM Entities is bound,
which breach or default could reasonably be expected to have a Material
Adverse Effect. The issuance and sale of the Shares being delivered on the
Closing Date by the Company and the execution, delivery and performance by
the Company and the Operating Partnership of their obligations under this
Agreement do not, to such counsel's knowledge, result in any violation of
any federal or District of Columbia statute, rule or regulation applicable
to the FWM Entities.
(viii) To such counsel's knowledge, no consent, approval,
authorization or order of, or filing with, any federal or District of
Columbia court or governmental agency or body is required in connection
with the execution and delivery of this Agreement and the consummation of
the transactions herein contemplated, except such as may be required under
state securities laws in connection with the purchase and distribution of
such Shares by the Underwriters or real estate syndication laws.
(ix) The Company has been organized and has operated in conformity
with the requirements for qualification as a REIT under the Code, and its
proposed method of operation has enabled and will enable it to meet the
requirements for qualification and taxation as a REIT under the Code.
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<PAGE>
(x) None of the FWM Entities is, or after giving effect to the
consummation of the transactions contemplated by this Agreement, and the
application of the net proceeds therefrom as described in the prospectus,
will be required to register as an "investment company" within the meaning
of the Investment Company Act of 1940, as amended.
(xi) The Shares have been authorized for listing on New York Stock
Exchange.
(xii) Except as described in or contemplated by the Prospectus, to the
knowledge of such counsel, there are no outstanding securities of the
Company convertible or exchangeable into or evidencing the right to
purchase or subscribe for any shares of capital stock of the Company and
there are no outstanding or authorized options, warrants or rights
obligating the Company to issue any shares of its capital stock or any
securities convertible or exchangeable into or evidencing the right to
purchase or subscribe for any shares of such stock; and except as described
in the Prospectus, to the knowledge of such counsel, no holder of any
securities of the Company or any other person has the right, contractual or
otherwise, which has not been satisfied or effectively waived, to cause the
Company to sell or otherwise issue to them, or the right to have any Shares
or other securities of the Company included in the Registration Statement
or the right, as a result of the filing of the Registration Statement, to
require registration under the Act of any Shares or other securities of the
Company.
(xiii) No registration under the Act of the Units to be issued in
connection with the acquisition of the New Retail Properties is required
for the issuance by the Operating Partnership of Units to accredited
investors in the manner contemplated by the agreements for the purchase of
the New Retail Properties (assuming (i) the accuracy of the Operating
Partnership's representations regarding the absence of a general
solicitation in connection with the private placement of the Units and (ii)
the accuracy of the representations made by the Operating Partnership and
each recipient of the Units).
In addition, such opinion shall also include a statement to the effect that
such counsel has participated in conferences with officers and other
representatives of the Company, representatives of the independent public
accountants for the Company, and representatives of the Underwriters, at which
the contents of the Prospectus and related matters were discussed and, although
such counsel need not pass upon, and does not assume any responsibility for, the
accuracy, completeness or fairness of the statements contained in the
Prospectus, and such counsel has made no independent check or verification
thereof, during the course of such participation (relying as to materiality, to
the extent such counsel deems appropriate, upon the statements of officers and
other representatives of the Company), no facts came to such counsel's attention
that caused them to believe that the (i) Registration Statement, at the time
such Registration Statement became effective (but after giving effect to any
modifications incorporated therein pursuant to Rule 430A under the Act), and as
of the date of such opinion, contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and (ii) the Prospectus, or any
supplement thereto, on the date it was filed pursuant to the Rules and
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Regulations and as of the Closing Date or the Option Closing Date, as the case
may be, contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; it being understood that such counsel need express no belief with
respect to the financial statements, schedules and other financial and
statistical data included in the Registration Statement or Prospectus.
(c) The Underwriters shall have received an opinion, dated the Closing Date
and satisfactory in form and substance to the Underwriters (and stating that it
may be relied upon by counsel for the Underwriters), from Ballard Spahr Andrews
& Ingersoll, Maryland counsel to the Company and the Operating Partnership, to
the effect that:
(i) The Company is a corporation duly incorporated and existing under
the laws of the State of Maryland and is in good standing with the Maryland
State Department of Assessments and Taxation (the "SDAT"), with corporate
power and authority to own, lease and operate its properties and to conduct
its business as described in the Prospectus and to enter into and perform
its obligations under this Agreement and the Material Agreements to which
it is a party.
(ii) The Operating Partnership is a limited partnership duly formed
and existing under the laws of the State of Maryland and is in good
standing with the SDAT, with partnership power and authority to own, lease
and operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under this
Agreement and the Material Agreements to which it is a party. The Company
is the sole general partner of the Operating Partnership. The outstanding
Units of the Operating Partnership are fully paid and the Certificate of
Limited Partnership and Agreement of Limited Partnership do not provide for
any assessments on the limited partnership interests of the partners.
(iii) Each of Valley Center, Inc., a Maryland corporation, JFD, Inc.,
a Maryland corporation, Bryans QRS, Inc., a Maryland corporation, and
Branchwood, Inc., a Maryland corporation (collectively, the "QRSs"), is a
corporation duly incorporated and existing under the laws of the State of
Maryland and is in good standing with the SDAT, with corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus and to enter into and perform its
obligations under the Material Agreements to which it is a party. The
outstanding shares of stock of each of the QRSs have been duly authorized
and validly issued, are fully paid and nonassessable and are owned by the
Company, to such counsel's knowledge, free and clear of all liens,
encumbrances and equities and claims, and no options, warrants or other
rights to purchase, agreements or other obligations to issue or other
rights to convert any obligations into any shares of capital stock or of
ownership interests in such Subsidiaries are outstanding.
(iv) Each of JFD Limited Partnership, a Maryland limited partnership,
Branchwood Apartments Limited Partnership, a Maryland limited partnership,
SP Associates Limited Partnership, a Maryland limited partnership,
FW-Bryans Road Limited Partnership, a Maryland limited partnership,
Greenspring
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Associates Limited Partnership, a Maryland limited partnership, Woodholme
Properties Limited Partnership, a Maryland limited partnership, Southside
Marketplace Limited Partnership, a Maryland limited partnership, Allenbeth
Associates Limited Partnership, a Maryland limited partnership, and
Cloppers Mill Village Center L.L.C., a Maryland limited liability company,
(together, the "BRPs"), is a limited partnership or limited liability
company, as the case may be, duly formed and existing under the laws of the
State of Maryland and is in good standing with the SDAT, with the
partnership or limited liability company power and authority to own, lease
and operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under the Material
Agreements to which it is a party. The outstanding partnership or limited
liability company interests of each of the BRPs are owned by the Company, a
wholly owned subsidiary of the Company, or the Operating Partnership, to
such counsel's knowledge, free and clear of all liens, encumbrances,
equities and claims, and no options, warrants or other rights to purchase,
agreements or other obligations to issue or other rights to convert any
obligations into any partnership or limited liability company interests or
ownership interests in such Subsidiaries are outstanding.
(v) The Company has the numbers of authorized shares of stock as set
forth under the caption "Capitalization" in the Prospectus. The Charter and
Bylaws of the Company are in full force and effect as of the Closing Date
and comply with the Maryland General Corporation Law. The authorized shares
of the Company's Common Stock have been duly authorized. The outstanding
shares of the Company's stock have been duly authorized and validly issued
and are fully paid and nonassessable. The Shares have been duly authorized
for issuance and sale to the Underwriters pursuant to this Agreement, and,
when issued and delivered by the Company pursuant to this Agreement against
full payment of the consideration therefor as provided in the resolutions
authorizing issuance thereof of the Board of Directors of the Company or a
duly appointed committee thereof, will be validly issued and fully paid and
nonassessable. The terms of the Shares conform in all material respects to
all statements and descriptions related thereto contained in the Prospectus
under the caption "General Description of Capital Stock" and "Description
of Common Stock." The certificates representing the Shares comply with all
applicable statutory requirements of the Maryland General Corporation Law.
The Shares to be issued and sold by the Company pursuant to this Agreement
are not subject to preemptive rights or any similar rights to purchase
under the Charter of the Company, the Bylaws of the Company, the Maryland
General Corporation Law or any agreement or instrument known to such
counsel.
(vi) The statements set forth in the Prospectus under the caption
"Certain Provisions of Maryland Law," "General Description of Capital
Stock" and "Description of Common Stock," insofar as such statements
constitute a summary of legal matters or legal conclusions, have been
reviewed and are accurate in all material respects.
(vii) The partnership agreement of the Operating Partnership has been
duly executed and is in full force and effect as of the Closing Date and
complies with the Maryland Revised Uniform Limited Partnership Act. The
Units issued by the
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Operating Partnership to date, including without limitation the Units
issued to the Company, are fully paid.
(viii) The execution and delivery of the Agreement and the Material
Agreements and the consummation of the transactions herein and therein
contemplated will not result in any violation of the Charter or Bylaws of
the Company or Agreement of Limited Partnership of the Operating
Partnership or, so far as is known to such counsel, any statute, rule or
regulation of the State of Maryland applicable to the Company, the
Operating Partnership or the Subsidiaries.
(ix) The execution and delivery of this Agreement and the Material
Agreements have been duly authorized by all necessary corporate or
partnership action, as applicable, of the FWM Entities that are parties
thereto, and this Agreement and the Material Agreements have been duly
executed and delivered by the FWM Entities that are parties thereto.
Assuming due authorization, execution and delivery of the Material
Agreements by each other party thereto, the Material Agreements are valid
and binding agreements of the FWM Entities that are parties thereto,
enforceable against the FWM Entities in accordance with their terms. This
opinion does not include any opinion with respect to the perfection or
priority of any security interest or lien, and is further subject to the
following limitations, qualifications and exceptions: (a) the effect of
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance
or other similar laws now or hereafter in effect relating to or affecting
the rights or remedies of creditors, (b) the effect of general principles
of equity, whether considered in a proceeding in equity or at law, and the
discretion of the court before which any proceeding therefor may be
brought, (c) the doctrine of commercial reasonableness, (d) the
unenforceability under certain circumstances under law or court decisions
of provisions providing for the indemnification of or contribution to a
party with respect to a liability where such indemnification or
contribution is contrary to public policy, and (d) the unenforceability of
any provision requiring the payment of attorney's fees, except to the
extent that a court determines such fees to be reasonable.
(d) The Underwriters shall have received an opinion, dated the Closing Date
and any Option Closing Date and satisfactory in form and substance to the
Underwriters (and stating that it may be relied upon by counsel to the
Underwriters), from Jeffrey S. Distenfeld, general counsel to the Company, FWM
and the Operating Partnership, to the effect that:
To such counsel's knowledge, except as set forth in the Prospectus there
are no material legal proceedings pending or threatened against the Company, the
Operating Partnership, FWM or any Subsidiary.
(e) The Underwriters shall have received from Hogan & Hartson L.L.P.,
counsel for the Underwriters, an opinion dated the Closing Date or the Option
Closing Date, as the case may be, substantially to the effect specified in
subparagraphs (i) (first two clauses only) and (ii) (first two clauses only) of
Paragraph (b) of this Section 6, and that this Agreement has been duly
authorized, executed and delivered by the Company and the Operating Partnership,
the Company was incorporated and is existing under the laws of the State of
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Maryland and that the Shares have been authorized and will upon issuance be
validly issued, fully paid and non-assessable. In rendering such opinion, Hogan
& Hartson L.L.P. may rely as to all matters governed other than by the laws of
the State of Maryland or federal laws on the opinions of counsel referred to in
paragraph (b) of this Section 6. In addition to the matters set forth above,
such opinion shall also include a statement to the effect that no facts have
come to the attention of such counsel which causes them to believe that (i) the
Registration Statement, as of the time it became effective under the Act, as of
the Closing Date or the Option Closing Date, as the case may, contained an
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and (ii) the Prospectus, or any supplement thereto, on the date it was filed
pursuant to the Rules and Regulations and as of the Closing Date or the Option
Closing Date, as the case may be, contained an untrue statement of a material
fact or omitted to state a material fact, necessary in order to make the
statements, in the light of the circumstances under which they are made, not
misleading (except that such counsel need express no view as to financial
statements, notes and supporting schedules and other financial and statistical
information and data included in or omitted from the Registration Statement or
the Prospectus). With respect to such statement, Hogan & Hartson L.L.P. may
state that their belief is based upon the procedures set forth therein, but is
without independent check and verification.
(f) The Underwriters shall have received at or prior to the Closing Date
from Hogan & Hartson L.L.P. a memorandum or summary, in form and substance
satisfactory to the Underwriters, with respect to the qualification for offering
and sale by the Underwriters of the Shares under the state securities or "blue
sky" laws of such jurisdictions as the Underwriters may reasonably have
designated to the Company.
(g) The Underwriters shall have received on the Closing Date or the Option
Closing Date, as the case may be, a certificate or certificates of the Chief
Executive Officer and the Chief Financial Officer of the Company in their
capacities as such, on behalf of the Company and the Operating Partnership, to
the effect that, as of the Closing Date or the Option Closing Date, as the case
may be:
(i) The Registration Statement has become effective under the Act and
no stop order suspending the effectiveness of the Registration Statement
has been issued, and no proceedings for such purposes have been initiated
or are, to his knowledge, contemplated by the Commission.
(ii) The representations and warranties of the Company and the
Operating Partnership contained in Section 1 hereof are true and correct as
of the Closing Date or the Option Closing Date, as the case may be.
(iii) All filings required to have been made pursuant to Rule 424
under the Act have been made.
(iv) He has carefully examined the Registration Statement and the
Prospectus and, in his opinion, as of the effective date of the
Registration Statement, the statements contained in the Registration
Statement and Prospectus, including any documents incorporated by reference
therein, were true and correct in all material
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respects, and such Registration Statement and Prospectus or any document
incorporated by reference therein did not omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading and, since the effective date of the Registration
Statement, no event has occurred which should have been set forth in a
supplement to or an amendment of the Prospectus which has not been so set
forth in such supplement or amendment.
(v) Since the respective dates as of which information is given in the
Registration Statement and Prospectus, there has not been any material
adverse change in or affecting the condition, financial or otherwise, of
the Company, the Operating Partnership, FWM and the Subsidiaries taken as a
whole or the earnings, business, management, properties, assets, rights,
operations, condition (financial or otherwise) or prospects of the Company,
the Operating Partnership, FWM and the Subsidiaries taken as a whole,
whether or not arising in the ordinary course of business.
(h) The Shares shall be qualified for sale in such jurisdictions as the
Underwriters may reasonably request, each such qualification shall be in effect
and not subject to any order or other proceeding on the Closing Date.
(i) The Underwriters shall have received, on each of the dates hereof, the
Closing Date and the Option Closing Date, as the case may be, a letter dated the
date hereof, the Closing Date or the Option Closing Date, as the case may be, in
form and substance satisfactory to you, of Coopers & Lybrand LLP confirming that
they are independent public accountants within the meaning of the Act and the
applicable published Rules and Regulations thereunder and stating that in their
opinion the financial statements and schedules examined by them and included in
the Registration Statement comply in form in all material respects with the
applicable accounting requirements of the Act and the related published Rules
and Regulations; and containing such other statements and information as is
ordinarily included in accountants' "comfort letters" to Underwriters with
respect to the financial statements and certain financial and statistical
information contained [or incorporated by reference] in the Registration
Statement and Prospectus.
(j) The Lock-Up Agreements described in Section 4(1) are in full force and
effect.
(k) Prior to the Closing Date, the Company shall have furnished to you such
further information, certificates and documents, confirming the representations
and warranties, covenants and conditions contained herein, the performance of
obligations hereunder and related matters as the Representatives may reasonably
have requested.
(l) The Firm Shares and Option Shares, if any have been approved for
listing upon notice of issuance on the New York Stock Exchange.
The opinions and certificates mentioned in this Agreement shall be deemed
to be in compliance with the provisions hereof only if they are in all material
respects satisfactory to the Underwriters and counsel for the Underwriters.
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If any of the conditions herein above provided for in this Section 6 shall
not have been fulfilled when and as required by this Agreement to be fulfilled,
the obligations of the Underwriters hereunder may be terminated by the
Underwriters by notifying the Company of such termination in writing or by
telegram at or prior to the Closing Date or the Option Closing Date, as the case
may be.
In such event, the Company and the Underwriters shall not be under any
obligation to each other (except to the extent provided in Sections 5 and 8
hereof).
7. CONDITION OF THE OBLIGATIONS OF THE COMPANY.
The obligations of the Company to sell and deliver the Shares required to
be delivered as and when specified in this Agreement are subject to the
condition that at the Closing Date or the Option Closing Date, as the case may
be, no stop order suspending the effectiveness of the Registration Statement
shall have been issued and in effect or proceedings therefor initiated or
threatened.
8. INDEMNIFICATION.
(a) The Company and the Operating Partnership, jointly and severally agree
to indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of the Act against any losses,
claims, damages or liabilities to which such Underwriter or such controlling
person may become subject under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions or proceedings in respect thereof)
arise out of or are based upon (i) any untrue statement or alleged untrue
statement of any material fact contained or incorporated by reference in the
Registration Statement or any amendment thereto, or the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or (ii) any untrue
statement or alleged untrue statement of any material fact contained in any
Preliminary Prospectus or the Prospectus or any supplement thereto, or the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading or (iii) any act or
failure to act or any alleged failure to act by any Underwriter in connection
with or relating in any manner to, the Shares or the offering contemplated
hereby, and which is included as part of or referred to in any loss, claim,
damage, liability or action arising out of or based upon matters covered by
clause (i) or (ii) above (provided that the Company and the Operating
Partnership shall not be liable under this clause (iii) to the extent that it is
determined in a final judgment by a court or competent jurisdiction that such
loss, claim, damage, liability or action resulted directly from any such acts or
failures to act undertaken or omitted to be taken by such Underwriter through
its gross negligence or willful misconduct). The Company and the Operating
Partnership agree to reimburse each Underwriter and each such controlling person
upon demand for any legal or other expenses reasonably incurred by such
Underwriter or such controlling person in connection with investigating or
defending any such loss, claim, damage, liability, action or proceeding or in
responding to a subpoena or governmental inquiry related to the offering of the
Shares, whether
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or not such Underwriter or controlling person is a party to any action or
proceeding; provided, however, that the Company and the Operating Partnership
will not be liable in any such case to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement, or omission or alleged omission made in the
Registration Statement, any Preliminary Prospectus, the Prospectus, or such
amendment or supplement, in reliance upon and in conformity with written
information furnished to the Company or the Operating Partnership by or through
the Underwriters specifically for use in the preparation thereof.
The foregoing indemnity agreement is subject to the condition that, insofar
as it relates to any such untrue statement, alleged untrue statement, omission
or alleged omission made in a Preliminary Prospectus but eliminated or remedied
in the Prospectus, such indemnity agreement shall not inure to the benefit of
any Underwriter from whom the person asserting any loss, liability, claim or
damage purchased the Shares (or to the benefit of any person who controls such
Underwriter) if a copy of the Prospectus was not furnished to such person at or
prior to the time such action is required by the Act.
(b) Each Underwriter severally and not jointly will indemnify and hold
harmless the Company and the Operating Partnership, each of their directors,
each of their officers who have signed the Registration Statement and each
person, if any, who controls the Company or the Operating Partnership within the
meaning of the Act, against any losses, claims, damages or liabilities to which
the Company and the Operating Partnership or any such director, officer or
controlling person may become subject under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) arise out of or are based upon (i) any untrue statement or
alleged untrue statement of any material fact contained in the Registration
Statement, any Preliminary Prospectus, the Prospectus or any amendment or
supplement thereto, or (ii) the omission or the alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances under which
they were made; and will reimburse any legal or other expenses reasonably
incurred by the Company and the Operating Partnership or any such director,
officer or controlling person in connection with investigating or defending any
such loss, claim, damage, liability, action or proceeding; provided, however,
that each Underwriter will be liable in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission has been made in the Registration Statement, any Preliminary
Prospectus, the Prospectus or such amendment or supplement, in reliance upon and
in conformity with written information furnished to the Company or the Operating
Partnership by or through the Underwriters specifically for use in the
preparation thereof. This indemnity agreement will be in addition to any
liability which such Underwriter may otherwise have.
(c) In case any proceeding (including any governmental investigation) shall
be instituted involving any person in respect of which indemnity may be sought
pursuant to this Section 8, such person (the "indemnified party") shall promptly
notify the person against whom such indemnity may be sought (the "indemnifying
party") in writing. No indemnification provided for in Section 8(a) or (b) shall
be available to any party who shall fail to give notice as provided in this
Section 8(c) if the party to whom notice was not given was
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unaware of the proceeding to which such notice would have related and was
materially prejudiced by the failure to give such notice, but the failure to
give such notice shall not relieve the indemnifying party or parties from any
liability which it or they may have to the indemnified party for contribution or
otherwise than on account of the provisions of Section 8(a) or (b). In case any
such proceeding shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel reasonably satisfactory to such indemnified
party and shall pay as incurred (or within 30 days of presentation) the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own counsel
at its own expense. Notwithstanding the foregoing, the indemnifying party shall
pay as incurred the fees and expenses of the counsel retained by the indemnified
party if (i) the indemnifying party and the indemnified party shall have
mutually agreed to the retention of such counsel, (ii) the named parties to any
such proceeding (including any impleaded parties) include both the indemnifying
party and the indemnified party and representation of both parties by the same
counsel would be inappropriate, in the reasonable determination of the
indemnified party or its counsel, due to actual or potential differing interests
between them or (iii) the indemnifying party shall have failed to assume the
defense and employ counsel acceptable to the indemnified party within a
reasonable period of time after notice of commencement of the action. It is
understood that the indemnifying party shall not, in connection with any
proceeding or related proceedings in the same jurisdiction, be liable for the
reasonable fees and expenses of more than one separate firm for all such
indemnified parties. Such firm shall be designated in writing by you in the case
of parties indemnified pursuant to Section 8(a) and by the Company or the
Operating Partnership in the case of parties indemnified pursuant to Section
8(b); the indemnifying party shall not be liable for any settlement of any
proceeding effected without its written consent but if settled with such consent
or if there is a final judgment for the plaintiff, the indemnifying party agrees
to indemnify the indemnified party from and against any loss or liability by
reason of such settlement or judgment. In addition, the indemnifying party will
not, without the prior written consent of the indemnified party, settle or
compromise or consent to the entry of any judgment in any pending or threatened
claim, action or proceeding of which indemnification may be sought hereunder
(whether or not any indemnified party is an actual or potential party to such
claim, action or proceeding) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action or proceeding.
(d) If the indemnification provided for in this Section 8 is unavailable to
or insufficient to hold harmless an indemnified party under Section 8(a) or (b)
above in respect of any losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) referred to therein, then each indemnifying
party shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) in such proportion as is appropriate to reflect
the relative benefits received by the Company or the Operating Partnership on
the one hand and the Underwriters on the other from the offering of the Shares.
If, however, the allocation provided by the immediately preceding sentence is
not permitted by applicable law or if the indemnified party failed to give the
notice required under Section 8(c) above, then each indemnifying party shall
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contribute to such amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the Company or the Operating Partnership on the one hand
and the Underwriters on the other in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Company or the Operating
Partnership on the one hand and the Underwriters on the other shall be deemed to
be in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Company or the Operating Partnership bear to
the total underwriting discounts and commissions received by the Underwriters,
in each case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company or the Operating Partnership on the one hand or the Underwriters on the
other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the Operating Partnership and the Underwriters agree that
it would not be just and equitable if contributions pursuant to this Section
8(d) were determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to above in
this Section 8(d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions or proceedings
in respect thereof) referred to above in this Section 8(d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), (i) no Underwriter shall
be required to contribute any amount in excess of the underwriting discounts and
commissions applicable to the Shares purchased by such Underwriter and (ii) no
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations in
this Section 8(d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) In any proceeding relating to the Registration Statement, any
Preliminary Prospectus, the Prospectus or any supplement or amendment thereto,
each party against whom contribution may be sought under this Section 8 hereby
consents to the jurisdiction of any court having jurisdiction over any other
contributing party, agrees that process issuing from such court may be served
upon him or it by any other contributing party and consents to the service of
such process and agrees that any other contributing party may join him or it as
an additional defendant in any such proceeding in which such other contributing
party is a party.
(f) Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under this
Section 8 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 8 and the
representations and warranties of the Company set forth in this Agreement shall
remain
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operative and in full force and effect, regardless of (i) any investigation made
by or on behalf of any Underwriter or any person controlling any Underwriter,
the Company or the Operating Partnership, the Company's directors or officers or
any persons controlling the Company or the Operating Partnership, (ii)
acceptance of any Shares and payment therefor hereunder, and (iii) any
termination of this Agreement. A successor to any Underwriter, or to the Company
or the Operating Partnership, the Company's directors or officers, or any person
controlling the Company or the Operating Partnership, shall be entitled to the
benefits of the indemnity, contribution and reimbursement agreements contained
in this Section 8.
9. DEFAULT BY UNDERWRITERS.
If on the Closing Date or the Option Closing Date, as the case may be, any
Underwriter shall fail to purchase and pay for the portion of the Shares which
such Underwriter has agreed to purchase and pay for on such date (otherwise than
by reason of any default on the part of the Company), the Underwriters shall use
their reasonable efforts to procure within 36 hours thereafter one or more of
the other Underwriters, or any others, to purchase from the Company such amounts
as may be agreed upon and upon the terms set forth herein, the Firm Shares or
Optional Shares, as the case may be, which the defaulting Underwriter or
Underwriters failed to purchase. If during such 36 hours the Underwriters, shall
not have procured such other Underwriters, or any others, to purchase the Firm
Shares or Optional Shares, as the case may be, agreed to be purchased by the
defaulting Underwriter or Underwriters, then (a) if the aggregate number of
shares with respect to which such default shall occur does not exceed 10% of the
Firm Shares or Optional Shares, as the case may be, covered hereby, the other
Underwriters shall be obligated, severally, in proportion to the respective
numbers of Firm Shares or Optional Shares, as the case may be, which they are
obligated to purchase hereunder, to purchase the Firm Shares or Optional Shares,
as the case may be, which such defaulting Underwriter or Underwriters failed to
purchase, or (b) if the aggregate number of shares of Firm Shares or Optional
Shares, as the case may be, with respect to which such default shall occur
exceeds 10% of the Firm Shares or Optional Shares, as the case may be, covered
hereby, the Company or the Underwriters will have the right, by written notice
given within the next 36-hour period to the parties to this Agreement, to
terminate this Agreement without liability on the part of the non-defaulting
Underwriters or of the Company except to the extent provided in Section 8
hereof. In the event of a default by any Underwriter or Underwriters, as set
forth in this Section 9, the Closing Date or Option Closing Date, as the case
may be, may be postponed for such period, not exceeding seven days, as the
Underwriters may determine in order that the required changes in the
Registration Statement or in the Prospectus or in any other documents or
arrangements may be effected. The term "Underwriter" includes any person
substituted for a defaulting Underwriter. Any action taken under this Section 9
shall not relieve any defaulting Underwriter from liability in respect of any
default of such Underwriter under this Agreement.
10. NOTICE.
All communications hereunder, except as may be otherwise specifically
provided herein, shall be in writing and shall be mailed, delivered or
transmitted by any standard form of telecommunication, and confirmed in writing,
as follows: if to the Underwriters, to BT Alex.
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Brown Incorporated, 1 South Street, Baltimore, Maryland 21202, Attention:
William C. Byrnes, Managing Director, with a copy to Hogan & Hartson L.L.P., 555
Thirteenth Street, N.W., Washington, D.C. 20004, Attention: J. Warren Gorrell,
Jr., Esq.; if to the Company or the Operating Partnership, to First Washington
Realty Trust, Inc., 4350 East-West Highway, Suite 400, Bethesda, Maryland 20814,
Attention: William J. Wolfe with a copy to Latham & Watkins, 1001 Pennsylvania
Avenue, N.W., Suite 1300, Washington, D.C. 20004-2505, Attention: R. Ronald
Hopkinson, Esq.
11. TERMINATION.
This Agreement may be terminated by you by notice to the Company as
follows:
(a) at any time prior to the earlier of (i) the time the Shares are
released by you for sale by notice to the Underwriters, or (ii) 11:30 a.m. on
the first business day following the date of this Agreement;
(b) at any time prior to the Closing Date if any of the following has
occurred: (i) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any material adverse change in or
affecting the condition, financial or otherwise, of the Company, the Operating
Partnership, FWM and the Subsidiaries taken as a whole or the earnings,
business, management, properties, assets, rights, operations, condition
(financial or otherwise) or prospects of the Company, the Operating Partnership,
FWM and the Subsidiaries taken as a whole, whether or not arising in the
ordinary course of business, (ii) any outbreak or escalation or hostilities or
declaration of war or national emergency, calamity, crisis or change on the
financial markets of the United States would, in your reasonable judgment, make
it impracticable to market the Shares or to enforce contracts for the sale of
the Shares, or (iii) suspension of trading in securities generally on the New
York Stock Exchange or the American Stock Exchange or limitation on prices
(other than limitations on hours or numbers of days of trading) for securities
on either such Exchange, (iv) the enactment, publication, decree or other
promulgation of any statute, regulation, rule or order of any court or other
governmental authority which in your opinion materially and adversely affects or
may materially and adversely affect the business or operations of the Company,
the Operating Partnership, FWM and the Subsidiaries taken as a whole, (v)
declaration of a banking moratorium by United States or New York State
authorities, (vi) any downgrading in the rating of the Company's debt securities
by any "nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Exchange Act), (vii) the suspension of trading
of the Company's common stock by the Commission on the New York Stock Exchange
or (viii) the taking of any action by any governmental body or agency in respect
of its monetary or fiscal affairs which in your reasonable opinion has a
material adverse effect on the securities markets in the United States; or
(c) as provided in Sections 6 and 9 of this Agreement.
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12. SUCCESSORS.
This Agreement has been and is made solely for the benefit of the
Underwriters and the Company and the Operating Partnership and their respective
successors, executors, administrators, heirs and assigns, and the officers,
directors and controlling persons referred to herein, and no other person will
have any right or obligation hereunder. No purchaser of any of the Shares from
any Underwriter shall be deemed a successor or assign merely because of such
purchase.
13. INFORMATION PROVIDED BY UNDERWRITERS.
The Company, the Operating Partnership and the Underwriters acknowledge and
agree that only information furnished or to be furnished by any Underwriter to
the Company for inclusion in any Prospectus or the Registration Statement
consists of the information set forth in the last paragraph of the front cover
page (insofar as such information relates to the Underwriters), legends required
by Item 502(d) of Regulation S-K under the Act and the information under the
caption "Underwriting" in the Prospectus.
14. MISCELLANEOUS.
The reimbursement, indemnification and contribution agreements contained in
this Agreement and the representations, warranties and covenants in this
Agreement shall remain in full force and effect regardless of (a) any
termination of this Agreement, (b) any investigation made by or on behalf of any
Underwriter or controlling person thereof, or by or on behalf of the Company or
the Operating Partnership or their directors or officers and (c) delivery of and
payment for the Shares under this Agreement.
This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Maryland.
-30-
<PAGE>
If the foregoing letter is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Company, the Operating
Partnership and the several Underwriters in accordance with the terms.
Very truly yours,
FIRST WASHINGTON REALTY FIRST WASHINGTON REALTY
TRUST, INC., LIMITED PARTNERSHIP,
a Maryland corporation a Maryland limited partnership
By ___________________________ By: First Washington Realty
Name: Trust, Inc.,
Title: its general partner
By ___________________________
Name:
Title:
The foregoing Underwriting Agreement is
hereby confirmed and accepted as of the
date first above written.
BT ALEX. BROWN INCORPORATED
FRIEDMAN, BILLINGS, RAMSEY & CO., INC.
SALOMON BROTHERS INC
TUCKER ANTHONY INCORPORATED
As Representatives of the Several
Underwriters listed on Appendix I
By: BT ALEX. BROWN INCORPORATED
By ___________________________, Authorized Officer
-31-
<PAGE>
APPENDIX I
SCHEDULE OF UNDERWRITERS
Number of Firm Shares
Underwriter to be Purchased
----------- ---------------------
BT Alex. Brown Incorporated
Friedman, Billings, Ramsey & Co., Inc.
Salomon Brothers Inc
Tucker Anthony Incorporated
---------
TOTAL 1,800,000
=========
Exhibit 5
FILE NUMBER
845899
September 19, 1997
First Washington Realty Trust, Inc.
4350 East-West Highway, Suite 400
Bethesda, Maryland 20814
Re: Registration Statement on Form S-3 (No. 333-24017)
Ladies and Gentlemen:
We have served as Maryland counsel to First Washington Realty Trust, Inc.,
a Maryland corporation (the "Company"), in connection with certain matters of
Maryland law arising out of the Company's registration statement on Form S-3
(No. 333-24017) (the "Registration Statement") previously declared effective by
the Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended (the "1933 Act"), relating to the proposed public
offering of securities of the Company that may be offered and sold by the
Company from time to time as set forth in the prospectus which forms a part of
the Registration Statement (the "Prospectus"), and as to be set forth in one or
more supplements to the Prospectus (each, a "Prospectus Supplement"). This
opinion letter is rendered in connection with the proposed public offering of up
to 2,070,000 shares (the "Shares") of common stock, $.01 par value per share
(the "Common Stock"), of the Company (including up to 270,000 shares of Common
Stock which the Underwriters have the option to purchase solely to cover
over-allotments), as described in a Prospectus Supplement dated September 17,
1997. Unless otherwise defined herein, capitalized terms used herein shall have
the meanings assigned to them in the Registration Statement.
In connection with our representation of the Company, and as a basis for
the opinion hereinafter set forth, we have examined originals, or copies
certified or otherwise identified
<PAGE>
First Washington Realty Trust, Inc.
September 19, 1997
Page 2
to our satisfaction, of the following documents (hereinafter collectively
referred to as the "Documents"):
1. The Registration Statement and the related form of prospectus
included therein in the form in which it was transmitted to the Commission
under the 1933 Act;
2. The charter of the Company (the "Charter"), certified as of a
recent date by the State Department of Assessments and Taxation of Maryland
(the "SDAT");
3. The Second Amended and Restated Bylaws of the Company, certified as
of a recent date by its Secretary;
4. Resolutions adopted by the Board of Directors of the Company (the
"Board") relating to the sale, issuance and registration of the Shares,
certified as of a recent date by the Secretary of the Company (the
"Resolutions");
5. The form of certificate representing a share of Common Stock,
certified as of a recent date by the Secretary of the Company;
6. A certificate of the SDAT as to the good standing of the Company,
dated as of a recent date;
7. A certificate executed by Jeffrey S. Distenfeld, Secretary of the
Company, dated as of a recent date; and
8. Such other documents and matters as we have deemed necessary or
appropriate to express the opinion set forth in this letter, subject to the
assumptions, limitations and qualifications stated herein.
In expressing the opinion set forth below, we have assumed, and so far as
is known to us there are no facts inconsistent with, the following:
1. Each of the parties (other than the Company) executing any of the
Documents has duly and validly executed and delivered each of the Documents
to which such party is a signatory, and such party's obligations set forth
therein are legal, valid and binding.
2. Each individual executing any of the Documents on behalf of a party
(other than the Company) is duly authorized to do so.
<PAGE>
First Washington Realty Trust, Inc.
September 19, 1997
Page 3
3. Each individual executing any of the Documents, whether on behalf
of such individual or another person, is legally competent to do so.
4. All Documents submitted to us as originals are authentic. All
Documents submitted to us as certified or photostatic copies conform to the
original documents. All signatures on all such Documents are genuine. All
public records reviewed or relied upon by us or on our behalf are true and
complete. All statements and information contained in the Documents are
true and complete. There are no oral or written modifications of or
amendments to the Documents, and there has been no waiver of any of the
provisions of the Documents, by actions or conduct of the parties or
otherwise.
5. The Shares will not be issued or transferred in violation of any
restriction or limitation contained in the Charter.
The phrase "known to us" is limited to the actual knowledge, without
independent inquiry, of the lawyers at our firm who have performed legal
services in connection with the issuance of this opinion.
Based upon the foregoing, and subject to the assumptions, limitations and
qualifications stated herein, it is our opinion that:
1. The Company is a corporation duly incorporated and existing under
and by virtue of the laws of the State of Maryland and is in good standing
with the SDAT.
2. The Shares have been duly authorized and, when and if delivered
against payment therefor in accordance with the resolutions of the Board,
or a duly authorized committee thereof, authorizing their issuance, the
Shares will be duly and validly issued, fully paid and nonassessable.
The foregoing opinion is limited to the laws of the State of Maryland and
we do not express any opinion herein concerning any other law. The opinion
expressed herein is subject to the effect of judicial decisions which may permit
the introduction of parol evidence to modify the terms or the interpretation of
agreements. We express no opinion as to compliance with the securities (or "blue
sky") laws of the State of Maryland.
<PAGE>
First Washington Realty Trust, Inc.
September 19, 1997
Page 4
We assume no obligation to supplement this opinion if any applicable law
changes after the date hereof or if we become aware of any fact that might
change the opinion expressed herein after the date hereof.
This opinion is being furnished to you solely for submission to the
Commission as an exhibit to the Company's Current Report on Form 8-K filed with
the Commission today (the "8-K") and, accordingly, may not be relied upon by,
quoted in any manner to, or delivered to any other person or entity without, in
each instance, our prior written consent.
We hereby consent to the filing of this opinion as an exhibit to the 8-K
and to the use of the name of our firm therein. In giving this consent, we do
not admit that we are within the category of persons whose consent is required
by Section 7 of the 1933 Act.
Very truly yours,
Ballard Spahr Andrews & Ingersoll
Exhibit 8
September 19, 1997
First Washington Realty Trust, Inc.
4350 East/West Highway, Suite 400
Bethesda, MD 20814
Re: Federal Income Tax Consequences
Ladies and Gentlemen:
In connection with the registration statement on Form S-3 (the
"Registration Statement) filed by you on March 26, 1997 with the Securities and
Exchange Commission, in connection with the registration of $175,000,000
securites of the Company under the Securities Act of 1933, as amended, you have
requested our opinion concerning certain federal income tax consequences to the
Company of its election to be taxed as a real estate investment trust.
This opinion is based on various facts and assumptions, including the facts
set forth in the Registration Statement concerning the business, properties and
governing documents of the Company and First Washington Realty Limited
Partnership (the "Operating Partnership"). We have also been furnished with, and
with your consent have relied upon, certain representations made by the Company
and the Operating Partnership with respect to certain factual matters through a
certificate of an officer of the Company (the "Officer's Certificate"). With
respect to matters of Maryland law, we have relied exclusively upon the opinion
of Ballard Spahr Andrews & Ingersoll, counsel for the Company, dated September
19, 1997.
In our capacity as tax counsel to the Company, we have made such legal and
factual examinations and inquiries, including an examination of originals or
copies certified or otherwise identified to our satisfaction of such documents,
corporate records and other instruments as we have deemed necessary or
appropriate for purposes of this opinion. In our examination, we have assumed
the authenticity of all documents submitted to us as originals, the genuineness
of all signatures thereon, the legal capacity of natural persons executing such
documents and the conformity to authentic original documents of all documents
submitted to us as copies.
We are opining herein as to the effect on the subject transaction only of
the federal income tax laws of the United States and we express no opinion with
respect to the applicability thereto, or the effect thereon, of other federal
laws, the laws of any state or any other jurisdiction or as to any matters of
municipal law or the laws of any other local agencies within any state.
Based on such facts, assumptions and representations, it is our opinion
that:
1. Commencing with the Company's taxable year ending December 31,
1994, the Company has been organized in conformity with the requirements
for qualification as a "real estate investment trust," and its proposed
method of operation, as described in the representations of the Company and
the Operating Partnership referred to above, will enable the Company to
meet the requirements for qualification and taxation as a "real estate
investment trust" under the Internal Revenue Code of 1986, as amended (the
"Code").
2. The statements in the Registration Statement set forth under the
caption "Cerain Federal Income Tax Consequences to the Company of its REIT
Election" to the extent such information constitutes matters of law,
summaries of legal matters, or legal conclusions, have been reviewed by us
and are accurate in all material respects.
No opinion is expressed as to any matter not discussed herein.
<PAGE>
Latham & Watkins
First Washington Realty Trust, Inc.
September 19, 1997
Page 2
This opinion is based on various statutory provisions, regulations
promulgated thereunder and interpretations thereof by the Internal Revenue
Service and the courts having jurisdiction over such matters, all of which are
subject to change either prospectively or retroactively. Also, any variation or
difference in the facts from those set forth in the Registration Statement or
the Officer's Certificate may affect the conclusions stated herein. Moreover,
the Company's qualification and taxation as a real estate investment trust
depends upon the Company's ability to meet, through actual annual operating
results, distribution levels and diversity of stock ownership, the various
qualification tests imposed under the Code, the results of which have not been
and will not be reviewed by Latham & Watkins. Accordingly, no assurance can be
given that the actual results of the Company's operation for any one taxable
year will satisfy such requirements.
This opinion is rendered only to you, and is solely for your use in
connection with the issuance of common stock and preferred stock by the Company
pursuant to the Registration Statement. This opinion may not be relied upon by
you for any other purpose, or furnished to, quoted to, or relied upon by any
other person, firm or corporation, for any purpose, without our prior written
consent. We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the use of our name under the caption "Legal
Matters" in the Registration Statement.
Very truly yours,
Latham & Watkins
