UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: June 20, 2005
RECKSON ASSOCIATES REALTY CORP.
and
RECKSON OPERATING PARTNERSHIP, L.P.
(Exact name of each Registrant as specified in its Charter)
Reckson Associates Realty Corp. - Maryland Reckson Associates Realty Corp. -
Reckson Operating Partnership, L.P. - Delaware 11-3233650
(State or other jurisdiction of incorporation or organization) Reckson Operating Partnership, L.P. -
11-3233647
(IRS Employer ID Number)
225 Broadhollow Road 11747
Melville, New York (Zip Code)
(Address of principal executive offices)
1-13762
(Commission File Number)
(631) 694-6900
(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrants under any of
the following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 8.01. Other Events.
Amendment to Credit Facility. On June 20, 2005, Reckson Operating
Partnership, L.P. (the "Operating Partnership") amended its Third Amended and
Restated Credit Agreement (the "Credit Facility") with the Lenders party
thereto and JPMorgan Chase Bank, N.A., as Administrative Agent. Among other
changes, the amendment (i) extended the Operating Partnership's ability to use
the revolving credit feature through August 2008 (subject to extension for an
additional year at the Operating Partnership's option), (ii) modified a
financial covenant to increase the percentage that the Operating Partnership's
total indebtedness can represent when compared to the total value of the
Operating Partnership's assets on a temporary basis from 60% to 65% upon an
acquisition of a material property, (iii) reduced the rate of interest on
borrowings by 0.10%, (iv) modified the capitalization rates used to value the
Operating Partnership's properties for purposes of the financial covenants
contained in the Credit Facility and (v) increased the portion of assets and
net operating income that may relate to minority joint ventures from 5% to
10%.
Amendment to Term Loan. On June 20, 2005, the Operating Partnership and
Citicorp. North America, Inc. ("Citicorp.") amended their Term Loan Agreement,
dated as of May 12, 2005 (the "Bridge Facility"), in the same manner as the
amendment to the Credit Facility. In addition, the Operating Partnership and
Citicorp. entered into a waiver (the "Waiver") to the Bridge Facility,
pursuant to which Citicorp. waived compliance with the provisions in the
Bridge Facility that require the Operating Partnership to apply the net
proceeds of its offering of Debentures (as defined below) to the repayment of
the Bridge Facility. Under the terms of the Waiver, the Operating Partnership
is required to apply the proceeds of the offering of the Debentures to the
repayment of amounts outstanding under the Credit Facility.
Offering of Debentures. On June 21, 2005, the Operating Partnership and
Reckson Associates Realty Corp. (the "Company") entered into an underwriting
agreement and a related terms agreement (collectively, the "Underwriting
Agreement") with Citigroup Global Markets Inc. (the "Underwriter") in
connection with a public offering of $250 million aggregate principal amount
of the Operating Partnership's 4.00% Exchangeable Senior Debentures due 2025
(the "Debentures"). Interest on the Debentures will be payable semi-annually
on June 15 and December 15, commencing December 15, 2005. The Debentures
mature on June 15, 2025 and are guaranteed by the Company. Pursuant to the
terms of the Underwriting Agreement, the Underwriter was granted an option for
a 30-day period to purchase up to an additional $37,500,000 in principal
amount of Debentures to cover any over-allotments.
The closing of the offering of the Debentures took place on June 27,
2005. The net proceeds from the offering were approximately $244.8 million
after deducting the underwriting discount and other expenses. The Operating
Partnership used the net proceeds for the repayment of amounts outstanding
under the Credit Facility.
Approval of Settlement. On June 16, 2005, Judge Evelyn Omega Cannon of
the Circuit Court for Baltimore City signed an order regarding preliminary
approval and notice with respect to the shareholder derivative actions
previously described under "Part I, Item 3. Legal Proceedings" in the
Company's Annual Report on Form 10-K for the year ended December 31, 2004, and
under "Item 8.01. Other Events" in a Form 8-K filed by the Company on April 4,
2005. A hearing to consider approval of the proposed settlement has been
scheduled for September 20, 2005, at 9:30 a.m., in the Circuit Court for
Baltimore City.
Item 9.01. Financial Statements and Exhibits
2
(c) Exhibits
1.1 Underwriting Agreement, dated June 21, 2005, among the Operating
Partnership, the Company and Citigroup Global Markets Inc.
1.2 Terms Agreement, dated June 21, 2005, among the Operating Partnership,
the Company and Citigroup Global Markets Inc.
4.1 4.00% Exchangeable Senior Debentures due 2025 of the Operating
Partnership.
4.2 Indenture, dated March 26, 1999, among the Operating Partnership, the
Company and the Bank of New York as trustee.*
4.3 Officers' Certificate establishing the terms of the Debentures.
5 Opinion of Sidley Austin Brown and Wood LLP as to the legality of the
Debentures and the shares of common stock of the Company issuable upon
exchange of the Debentures.
10.1 Amendment No. 2 to Third Amended and Restated Credit Agreement, dated as
of June 20, 2005, among the Operating Partnership, the Lenders party
thereto and JPMorgan Chase Bank, N.A.
10.2 Amendment No. 1 to Term Loan Agreement, dated as of June 20, 2005, among
the Operating Partnership, the Lenders party thereto and Citicorp. North
America, Inc., as Administrative Agent.
10.3 Common Stock Delivery Agreement, dated as of June 21, 2005, between the
Operating Partnership and the Company.
- -------------------
* Previously filed as an exhibit to the Registrants' registration
statement on Form S-3 (File No. 333-115997).
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, each
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
RECKSON ASSOCIATES REALTY CORP.
By: /s/ Michael Maturo
-----------------------------------------
Michael Maturo
Executive Vice President
and Chief Financial Officer
RECKSON OPERATING PARTNERSHIP, L.P.
By: Reckson Associates Realty Corp.,
its General Partner
By: /s/ Michael Maturo
-----------------------------------------
Michael Maturo
Executive Vice President
and Chief Financial Officer
Date: June 27, 2005
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EXECUTION COPY
Exhibit 1.1
RECKSON OPERATING PARTNERSHIP, L.P.
AND
RECKSON ASSOCIATES REALTY CORP.
UNDERWRITING AGREEMENT
TABLE OF CONTENTS
Page
SECTION 1. Representations and Warranties.................................................................3
(a) Representations and Warranties by the Operating Partnership and the Company....................3
(1) Compliance with Registration Requirements.............................................4
(2) Incorporated Documents................................................................5
(3) Independent Accountants...............................................................5
(4) Financial Statements..................................................................5
(5) Internal Accounting Controls..........................................................6
(6) Controls and Procedures...............................................................6
(7) No Material Adverse Change in Business................................................6
(8) Good Standing of the Company..........................................................6
(9) Good Standing of the Operating Partnership............................................7
(10) Good Standing of the Subsidiaries.....................................................7
(11) Capitalization........................................................................7
(12) Authorization of Securities, and Indenture............................................8
(13) Descriptions of the Underwritten Securities, the Underlying Shares and the
Indenture.............................................................................8
(14) Authorization of this Underwriting Agreement and Terms Agreement......................9
(15) Authorization of the Common Stock Delivery Agreement..................................9
(16) Authorization of Guarantees...........................................................9
(17) Authorization of the Underlying Shares................................................9
(18) Absence of Defaults and Conflicts.....................................................9
(19) Absence of Labor Dispute.............................................................10
(20) Absence of Proceedings...............................................................10
(21) Accuracy of Exhibits.................................................................11
(22) REIT Qualification...................................................................11
(23) Investment Company Act...............................................................11
(24) Intellectual Property................................................................11
(25) Absence of Further Requirements......................................................12
(26) Possession of Licenses and Permits...................................................12
(27) Title to Property....................................................................12
(28) Environmental Laws...................................................................13
(29) Tax Returns..........................................................................14
(30) Environmental Consultants............................................................14
-i-
TABLE OF CONTENTS
(continued)
Page
(31) Title Insurance......................................................................14
(32) Absence of Regulation M Violation....................................................14
(33) Sarbanes Oxley Act Compliance........................................................15
(b) Officers' Certificates........................................................................15
SECTION 2. Sale and Delivery to Underwriters; Closing....................................................15
(a) Underwritten Securities.......................................................................15
(b) Option Underwritten Securities................................................................15
(c) Payment.......................................................................................16
(d) Denominations; Registration...................................................................16
SECTION 3. Covenants of the Operating Partnership and the Company........................................16
(a) Compliance with Securities Regulations and Commission Requests................................16
(b) Filing of Amendments..........................................................................17
(c) Delivery of Registration Statements...........................................................17
(d) Delivery of Prospectuses......................................................................17
(e) Continued Compliance with Securities Laws.....................................................18
(f) Blue Sky Qualifications.......................................................................18
(g) Earnings Statement............................................................................18
(h) Reporting Requirements........................................................................19
(i) REIT Qualification............................................................................19
(j) Use of Proceeds...............................................................................19
(l) No Manipulation of Market for Securities......................................................19
(n) Reservation of Securities.....................................................................19
(o) Listing.......................................................................................20
(p) Lock-Up.......................................................................................20
SECTION 4. Payment of Expenses...........................................................................20
(a) Expenses......................................................................................20
(b) Termination of Agreement......................................................................21
SECTION 5. Conditions of Underwriters' Obligations.......................................................21
(a) Effectiveness of Registration Statement.......................................................21
(b) Opinion of Counsel for the Operating Partnership and the Company..............................21
(c) Opinion of Counsel for Underwriters...........................................................22
(d) Officers' Certificate.........................................................................22
-ii-
TABLE OF CONTENTS
(continued)
Page
(e) Accountant's Comfort Letter...................................................................23
(g) Ratings.......................................................................................23
(h) Over-Allotment Option.........................................................................23
(i) Additional Documents..........................................................................24
(j) Termination of Terms Agreement................................................................24
(k) Lock-Up Agreements............................................................................24
SECTION 6. Indemnification...............................................................................24
(a) Indemnification of Underwriters...............................................................24
(b) Indemnification of the Operating Partnership and the Company..................................25
(c) Actions against Parties; Notification; Settlement without Consent if Failure to
Reimburse.....................................................................................26
SECTION 7. Contribution..................................................................................26
SECTION 8. Representations, Warranties and Agreements to Survive Delivery................................27
SECTION 9. Termination...................................................................................28
(a) Underwriting Agreement........................................................................28
(b) Terms Agreement...............................................................................28
(c) Liabilities...................................................................................28
SECTION 10. [Intentionally Omitted].......................................................................28
SECTION 11. Notices.......................................................................................29
SECTION 12. Parties.......................................................................................30
SECTION 13. Governing Law and Time........................................................................30
SECTION 14. Effect of Headings............................................................................30
SECTION 15. Counterparts..................................................................................30
-iii-
RECKSON OPERATING PARTNERSHIP, L.P.
(a Delaware limited partnership)
Debt Securities
Fully and Unconditionally Guaranteed By
RECKSON ASSOCIATES REALTY CORP.
(a Maryland corporation)
UNDERWRITING AGREEMENT
June 21, 2005
Citigroup Global Markets Inc.
388 Greenwich Street, 32nd Floor
New York, NY 10013
As Representative
Ladies and Gentlemen:
Reckson Operating Partnership, L.P., a Delaware limited partnership (the
"Operating Partnership"), proposes to issue and sell up to $250,000,000
aggregate initial public offering price of its debt securities ("Debt
Securities") from time to time, in or pursuant to one or more offerings on
terms to be determined at the time of sale. The Debt Securities will be fully
and unconditionally guaranteed as to the payment of principal and interest
thereon (the "Guarantee" and, together with the Debt Securities, the
"Securities") by Reckson Associates Realty Corp., a Maryland corporation (the
"Company").
As used herein, "Underlying Shares" shall mean the shares of common
stock, par value $0.01 per share (the "Common Stock"), of the Company that may
be issued upon the exchange of the Securities.
The terms and rights of any particular issuance of Securities shall be as
specified in the Terms Agreement (as defined below) relating thereto and in or
pursuant to the indenture and any supplements or amendments thereto (the
"Indenture") identified in such Terms Agreement.
Whenever the Operating Partnership and the Company determine to make an
offering of Securities through the Representative or through an underwriting
syndicate managed by the Representative, the Operating Partnership and the
Company will enter into an agreement (each, a "Terms Agreement") providing for
the sale of such Securities to, and the purchase and offering thereof by, the
Representative and such other underwriters, if any, selected by the
Representative as have authorized the Representative to enter into such Terms
Agreement on their behalf (the "Underwriters," which term shall include the
Representative whether acting alone in the sale of the Underwritten Securities
(as defined herein) or as a member of an underwriting syndicate or any
Underwriter substituted pursuant to Section 10 hereof); provided, that, the
Operating
1
Partnership and the Company are not obligated, and shall have complete and
absolute discretion to determine if and when, to make any offering, to make
any offering through the Representative or any other person, or to enter into
any Terms Agreement. Prior to execution of a Terms Agreement, this
Underwriting Agreement shall not be construed as an obligation of the
Operating Partnership and the Company to sell any Securities or as an
obligation of any of the Underwriters to purchase Securities. The obligation
of the Operating Partnership and the Company to issue and sell any Securities
and the obligation of any of the Underwriters to purchase any Securities shall
be evidenced by the Terms Agreement with respect to the Underwritten
Securities specified therein. The Terms Agreement relating to the offering of
Securities shall specify the aggregate principal amount of Securities to be
initially issued (the "Initial Underwritten Securities"), the name of each
Underwriter participating in such offering (subject to substitution as
provided in Section 10 hereof), the aggregate principal amount of Initial
Underwritten Securities which each such Underwriter severally agrees to
purchase, whether such offering is on a fixed or variable price basis and, if
on a fixed price basis, the initial offering price, the price at which the
Initial Underwritten Securities are to be purchased by the Underwriters, the
form, time, date and place of delivery and payment of the Initial Underwritten
Securities and any other material variable terms of the Initial Underwritten
Securities, as well as the material terms of the related Underlying Shares. In
addition, if applicable, such Terms Agreement shall specify whether the
Operating Partnership and the Company have agreed to grant to the Underwriters
an option to purchase additional Securities to cover over-allotments, if any,
and the aggregate principal amount of Securities subject to such option (the
"Option Underwritten Securities"). As used herein, the term "Underwritten
Securities" shall include the Initial Underwritten Securities and all or any
portion of any Option Underwritten Securities. The Terms Agreement, which
shall be substantially in the form of Exhibit A hereto, may take the form of
an exchange of any standard form of written telecommunication among the
Operating Partnership, the Company and the Representative, acting for
themselves and, if applicable, as representatives of any other Underwriters.
Each offering of Underwritten Securities will be governed by this Underwriting
Agreement, as supplemented by the applicable Terms Agreement.
The Company and the Operating Partnership have filed with the Securities
and Exchange Commission (the "Commission") registration statements on Form S-3
(Nos. 333-46883 and 333-115997), for the registration of certain securities,
including the Securities and the Underlying Shares, under the Securities Act
of 1933, as amended (the "1933 Act"), and the offering thereof from time to
time in accordance with Rule 415 of the rules and regulations of the
Commission under the 1933 Act (the "1933 Act Regulations"), and the Company
and the Operating Partnership have filed such post-effective amendments
thereto as may be required prior to the execution of the applicable Terms
Agreement. Such registration statements (as so amended, if applicable) have
been declared effective by the Commission. Such registration statements (as so
amended, if applicable), including the information, if any, deemed to be a
part thereof pursuant to Rule 430A(b) of the 1933 Act Regulations (the "Rule
430A Information") or Rule 434(d) of the 1933 Act Regulations (the "Rule 434
Information"), are referred to herein collectively as the "Registration
Statement"; and the final prospectus constituting a part thereof and the
applicable prospectus supplement relating to the offering of the Underwritten
Securities, in the form first furnished to the Underwriters by the Operating
Partnership and the Company for use in connection with the offering of the
Underwritten Securities, are collectively referred to herein as the
"Prospectus"; provided, however, that all references to the "Registration
Statement" and the "Prospectus" shall be deemed to include all documents
incorporated therein by reference
2
pursuant to the Securities Exchange Act of 1934, as amended (the "1934 Act"),
prior to the execution of the applicable Terms Agreement; provided, further,
that if the Operating Partnership files a registration statement with the
Commission pursuant to Section 462(b) of the 1933 Act Regulations (the "Rule
462(b) Registration Statement"), then, after such filing, all references to
"Registration Statement" shall be deemed to include the Rule 462(b)
Registration Statement; provided, however, that a prospectus supplement shall
be deemed to have supplemented the Prospectus only with respect to the
offering of the Underwritten Securities to which it relates, and provided,
further, that if the Operating Partnership and the Company elect to rely upon
Rule 434 of the 1933 Act Regulations, then all references to "Prospectus"
shall be deemed to include the final or preliminary prospectus and the
applicable term sheet or abbreviated term sheet (the "Term Sheet"), as the
case may be, in the form first furnished to the Underwriters by the Operating
Partnership and the Company in reliance upon Rule 434 of the 1933 Act
Regulations, and all references in this Underwriting Agreement to the date of
the Prospectus shall mean the date of the Term Sheet. A "preliminary
prospectus" shall be deemed to refer to any prospectus used before the
registration statement became effective and any prospectus that omitted, as
applicable, the Rule 430A Information, the Rule 434 Information or other
information to be included upon pricing in a form of prospectus filed with the
Commission pursuant to Rule 424(b) of the 1933 Act Regulations, that was used
after such effectiveness and prior to the execution and delivery of the
applicable Terms Agreement. For purposes of this Underwriting Agreement, all
references to the Registration Statement, Prospectus, Term Sheet or
preliminary prospectus or to any amendment or supplement to any of the
foregoing shall be deemed to include the copy filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval system
("EDGAR"). Capitalized terms used but not otherwise defined herein shall have
the meanings given to those terms in the Prospectus.
All references in this Underwriting Agreement to financial statements and
schedules and other information which is "contained," "included" or "stated"
(or other references of like import) in the Registration Statement, Prospectus
or preliminary prospectus shall be deemed to mean and include all such
financial statements and schedules and other information which is or deemed to
be incorporated by reference in the Registration Statement, Prospectus or
preliminary prospectus, as the case may be; and all references in this
Underwriting Agreement to amendments or supplements to the Registration
Statement, Prospectus or preliminary prospectus shall be deemed to mean and
include the filing of any document under the 1934 Act which is or is deemed to
be incorporated by reference in the Registration Statement, Prospectus or
preliminary prospectus, as the case may be.
The term "Subsidiary" means a corporation or a partnership a majority of
the outstanding voting stock, partnership or membership interests, as the case
may be, of which is owned or controlled, directly or indirectly, by the
Operating Partnership and/or the Company or by one or more other Subsidiaries
of the Operating Partnership and/or the Company.
SECTION 1. Representations and Warranties.
------------------------------
(a) Representations and Warranties by the Operating Partnership and the
Company. Each of the Operating Partnership and the Company represents and
warrants, jointly and severally, to the Representative, as of the date hereof,
and to the Representative and each other Underwriter named in the applicable
Terms Agreement, as of the date thereof, as of the Closing
3
Time (as defined below) and, if applicable, as of each Date of Delivery (as
defined below) (in each case, a "Representation Date"), as follows:
(1) Compliance with Registration Requirements. Each of the Operating
Partnership and the Company meets the requirements for use of Form S-3
under the 1933 Act. Each of the Registration Statement and any Rule
462(b) Registration Statement has become effective under the 1933 Act and
no stop order suspending the effectiveness of the Registration Statement
or any Rule 462(b) Registration Statement has been issued under the 1933
Act and no proceedings for that purpose have been instituted or are
pending or, to the knowledge of the Operating Partnership and the
Company, are contemplated by the Commission or the state securities
authority of any jurisdiction, and any request on the part of the
Commission for additional information has been complied with. No order
preventing or suspending the use of the Prospectus has been issued and no
proceeding for that purpose has been instituted or, to the knowledge of
the Operating Partnership and the Company, threatened by the Commission
or the state securities authority of any jurisdiction.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto
(including the filing of the Operating Partnership's and the Company's
most recent Annual Reports on Form 10-K with the Commission (the "Annual
Reports on Form 10-K")) became effective and at each Representation Date,
the Registration Statement, any Rule 462(b) Registration Statement and
any amendments and supplements thereto complied and will comply in all
material respects with the requirements of the 1933 Act and the 1933 Act
Regulations and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), and the rules and regulations of the Commission under
the Trust Indenture Act (the "1939 Act Regulations") and did not and will
not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading. At the date of the Prospectus, and at
each Representation Date, the Prospectus, and any amendments and
supplements thereto did not and will not include an untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which
they were made, not misleading. If the Operating Partnership and the
Company elect to rely upon Rule 434 of the 1933 Act Regulations, the
Operating Partnership and the Company will comply with the requirements
of Rule 434. Notwithstanding the foregoing, the representations and
warranties in this subsection shall not apply to statements in or
omissions from the Registration Statement or the Prospectus made in
reliance upon and in conformity with information furnished to the
Operating Partnership and the Company in writing by any Underwriter
through the Representative expressly for use in the Registration
Statement or the Prospectus.
Each preliminary prospectus and Prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment or
supplement thereto, or filed pursuant to Rule 424 under the 1933 Act,
complied when so filed in all material respects with the 1933 Act and the
1933 Act Regulations and, if applicable, each preliminary prospectus and
the Prospectus delivered to the Underwriters for use in connection with
the offering of Underwritten Securities will, at the time of such
delivery,
4
be identical to the electronically transmitted copies thereof filed with
the Commission pursuant to EDGAR, except to the extent permitted by
Regulation S-T.
If a Rule 462(b) Registration Statement is required in connection
with the offering and sale of the Underwritten Securities, the Operating
Partnership has complied or will comply with the requirements of Rule 111
under the 1933 Act Regulations relating to the payment of filing fees
therefor.
(2) Incorporated Documents. The documents incorporated or deemed to
be incorporated by reference in the Registration Statement and the
Prospectus, at the time they were or hereafter are filed with the
Commission, complied and will comply in all material respects with the
requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations") and, when read
together with the other information in the Prospectus, at the date of the
Prospectus and at each Representation Date, or during the period
specified in Section 3(e), did not and will not include an untrue
statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
(3) Independent Accountants. The accountants who certified the
financial statements and supporting schedules included in, or
incorporated by reference into, the Registration Statement and the
Prospectus are independent public accountants as required by the 1933 Act
and the 1933 Act Regulations.
(4) Financial Statements. The financial statements of the Operating
Partnership and the Company included, or incorporated by reference, in
the Registration Statement and the Prospectus, together with the related
schedules and notes, as well as those financial statements, schedules and
notes of any other entity acquired or to be acquired by the Operating
Partnership or the Company included therein, if any, present fairly the
financial position of the respective entity or entities or group
presented therein at the respective dates indicated and the statement of
operations, stockholders' equity and cash flows data of such entity, as
the case may be, for the periods specified. Such financial statements
have been prepared in conformity with generally accepted accounting
principles ("GAAP") applied on a consistent basis throughout the periods
involved. The supporting schedules, if any, included or incorporated by
reference in the Registration Statement and the Prospectus present
fairly, in accordance with GAAP, the information required to be stated
therein. In addition, any pro forma financial information and the related
notes thereto 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 of the Public Company Accounting Oversight Board ("PCAOB")
with respect to pro forma information and have been properly compiled on
the bases described therein, and the assumptions used in the preparation
thereof were then reasonable and the adjustments used therein were then
appropriate to give effect to the transactions and circumstances referred
to therein. All historical financial statements and information and all
pro forma financial statements and information relating to the Operating
Partnership, the Company or any entity acquired or to be acquired by the
Operating Partnership or the Company required by the 1933 Act,
5
the 1933 Act Regulations, the 1934 Act and the 1934 Act Regulations are
included, or incorporated by reference, in the Registration Statement and
the Prospectus.
(5) Internal Accounting Controls. Each of the Operating Partnership
and the Company maintains a system of internal accounting controls
sufficient to provide reasonable assurance that: (a) transactions are
properly authorized; (b) assets are safeguarded against unauthorized or
improper use; and (c) transactions are properly recorded and reported as
necessary to permit preparation of its financial statements in conformity
with GAAP.
(6) Controls and Procedures. Each of the Operating Partnership and
the Company has established and maintains disclosure controls and
procedures in accordance with Rules 13a-15 and 15d-15 of the 1934 Act.
(7) No Material Adverse Change in Business. Since the respective
dates as of which information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein, (A) there has been no
material adverse change in the condition, financial or otherwise, or in
the earnings, assets, business affairs or business prospects of the
Operating Partnership, the Company and their Subsidiaries considered as
one enterprise whether or not arising in the ordinary course of business,
which would be material to the Operating Partnership and the Company,
taken as a whole (anything which would be material to the Operating
Partnership and the Company, taken as a whole, being hereinafter referred
to as "Material," and such a material adverse change, a "Material Adverse
Effect"), (B) no casualty loss or condemnation or other adverse event
with respect to any of the interests held directly or indirectly in any
of the real properties or real property interests, including without
limitation, any interest or participation, direct or indirect, in any
mortgage obligation owned, directly or indirectly, by the Operating
Partnership, the Company or any Subsidiary (the "Properties") has
occurred which would be Material, (C) there have been no transactions or
acquisitions entered into by the Operating Partnership, the Company or
any Subsidiary, other than those in the ordinary course of business,
which would be Material, (D) except for regular quarterly distributions
on units of the Operating Partnership (the "Units") or dividends on the
capital stock of the Company, there has been no dividend or distribution
of any kind declared, paid or made by the Operating Partnership with
respect to its Units or the Company with respect to its capital stock,
and (E) there has been no increase in the long term debt or decrease in
the capital of the Operating Partnership or any Subsidiary.
(8) Good Standing of the Company. The Company has been duly
organized and is validly existing as a corporation in good standing under
the laws of the State of Maryland and has 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, or as contemplated under this Underwriting Agreement and the
applicable Terms Agreement. The Company is duly qualified or registered
as a foreign corporation to transact business and is in good standing in
each other jurisdiction in which such qualification or registration is
required, whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure to so qualify or
register or be in good standing would not result in a Material Adverse
Effect.
6
(9) Good Standing of the Operating Partnership. The Operating
Partnership is duly organized and validly existing as a limited
partnership in good standing under the laws of the State of Delaware,
with partnership power and authority to own, lease and operate its
properties, to conduct the business in which it is engaged and proposes
to engage as described in the Prospectus and to enter into and perform
its obligations under this Underwriting Agreement and the applicable
Terms Agreement. The Operating Partnership is duly qualified or
registered as a foreign partnership and is in good standing in each
jurisdiction in which such qualification or registration is required,
whether by reason of the ownership or leasing of property or the conduct
of business, except where the failure to so qualify or register would not
have a Material Adverse Effect. The Company is the sole general partner
of the Operating Partnership and holds such number and/or percentage of
Units as disclosed in the Prospectus as of the dates set forth therein.
The Amended and Restated Agreement of Limited Partnership of the
Operating Partnership, dated June 2, 1995, as amended (the "Operating
Partnership Agreement"), is in full force and effect.
(10) Good Standing of the Subsidiaries. Each Subsidiary that is a
"significant subsidiary" as such term is defined in Section 1-02 of
Regulation S-X (each a "Significant Subsidiary," and collectively, the
"Significant Subsidiaries") is listed on Exhibit B hereto and has been
duly organized and is validly existing as a corporation, limited
partnership, limited liability company or other legal entity, as the case
may be, in good standing under the laws of the state of its jurisdiction
of incorporation or organization, as the case may be, with the requisite
power and authority to own, lease and operate its properties, and to
conduct the business in which it is engaged or proposes to engage as
described in the Prospectus. Each such entity is duly qualified or
registered as a foreign corporation, limited partnership or limited
liability company or other legal entity, as the case may be, to transact
business and is in good standing in each jurisdiction in which such
qualification or registration is required, whether by reason of the
ownership or leasing of property or the conduct of business, except where
the failure to so qualify or register would not have a Material Adverse
Effect. Except as otherwise stated in the Registration Statement and the
Prospectus, all of the issued and outstanding capital stock or other
equity interests of each such entity has been duly authorized and validly
issued and is fully paid and non-assessable, has been offered and sold in
compliance with all applicable laws (including, without limitation,
federal or state securities laws) and are owned, directly or indirectly,
by the Operating Partnership or the Company, in each case free and clear
of any security interest, mortgage, pledge, lien, encumbrance, claim or
equity (collectively, "Liens"). No shares of capital stock or other
equity interests of such entities are reserved for any purpose, and there
are no outstanding securities convertible into or exchangeable for any
capital stock or other equity interests of such entities and no
outstanding options, rights (preemptive or otherwise) or warrants to
purchase or to subscribe for shares of such capital stock or other equity
interests or any other securities of such entities, except as disclosed
in the Prospectus.
(11) Capitalization. The capitalization of the Operating Partnership
and the Company is as set forth in the Prospectus as of the date
referenced therein. All the issued and outstanding Units have been duly
authorized and are validly issued, fully paid and non-assessable and have
been offered and sold or exchanged in compliance with all
7
applicable laws (including, without limitation, federal and state
securities laws). There are no Units reserved for any purpose and there
are no outstanding securities convertible into or exchangeable for any
Units and no outstanding options, rights (preemptive or otherwise) or
warrants to purchase or to subscribe for Units, except for rights granted
to the partners in Omni Partners, L.P. (the "Omni Partnership") and the
rights of holders of Class C common Units and Series D and F preferred
Units or pursuant to the Company's Long-Term Incentive Plan. All issued
and outstanding shares of capital stock of the Company have been duly
authorized and validly issued by the Company and are fully paid and
non-assessable and have been offered and sold or exchanged in compliance
with all applicable laws (including, without limitation, federal and
state securities laws), and none of such shares of capital stock were
issued in violation of preemptive or other similar rights arising by
operation of law, under the charter and by-laws of the Company or under
any agreement to which the Company, the Operating Partnership or any
Subsidiary is a party or otherwise. Except as granted in this
Underwriting Agreement or any Terms Agreement and except for shares of
Common Stock issuable upon exchange of Units or upon the exercise of
options under the stock option plans, Long-Term Incentive Plan and/or
distribution reinvestment plans of the Company, there are no shares of
capital stock of the Company reserved for any purpose and there are no
outstanding securities convertible into or exchangeable for any shares of
capital stock of the Company and, except as granted in this Underwriting
Agreement or any Terms Agreement, there are no outstanding options,
rights (preemptive or otherwise) or warrants to purchase or to subscribe
for shares of such stock or any other securities of the Company.
(12) Authorization of Debt Securities and Indenture. The Debt
Securities have been duly authorized by the Operating Partnership, and,
when issued and delivered pursuant to this Underwriting Agreement and the
applicable Terms Agreement against payment of the requisite consideration
therefor, such Debt Securities will have been duly executed,
authenticated, issued and delivered and will constitute valid and legally
binding obligations of the Operating Partnership entitled to the benefits
provided by the Indenture, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
The Indenture has been duly qualified under the Trust Indenture Act
and has been duly authorized by the Operating Partnership and, at the
Closing Time and each Date of Delivery for such Underwritten Securities,
will constitute a valid and legally binding agreement, enforceable in
accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
(13) Descriptions of the Underwritten Securities, the Underlying
Shares and the Indenture. The Underwritten Securities being sold pursuant
to the applicable Terms Agreement, the Underlying Shares, when issued and
delivered in accordance with the terms of the Underwritten Securities,
and the Indenture will conform in all material respects to the statements
relating thereto contained in the Prospectus and will be in substantially
the form filed or incorporated by reference, as the case may be, as an
exhibit
8
to the Registration Statement. The form of debt security to be used to
evidence the Underwritten Securities and the form of stock certificate to
be used to evidence the Underlying Shares, respectively, will be in due
and proper form and will comply with all applicable legal requirements.
(14) Authorization of this Underwriting Agreement and Terms
Agreement. This Underwriting Agreement has been, and the applicable Terms
Agreement as of the date thereof will have been, duly authorized,
executed and delivered by the Operating Partnership and the Company.
(15) Authorization of the Common Stock Delivery Agreement. The
Common Stock Delivery Agreement, between the Operating Partnership and
the Company, dated as of June 21, 2005 (the "Common Stock Delivery
Agreement"), has been duly authorized, executed and delivered by each of
the Operating Partnership and the Company and, shall constitute a valid
and legally binding agreement of each of the Operating Partnership and
the Company, enforceable against each of the Operating Partnership and
the Company in accordance with its terms except (a) to the extent that
enforceability thereof may be limited by (i) bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or other similar laws
now or hereafter in effect relating to creditors' rights generally and
(ii) general principles of equity (regardless of whether considered at
law or in equity); and (b) that rights to indemnity contained in the
Common Stock Delivery Agreement may be limited by state or federal
securities laws or public policy.
(16) Authorization of Guarantee. The Guarantee has been duly
authorized by the Company, and, when the Debt Securities are executed,
authenticated, issued and delivered pursuant to the Indenture and this
Underwriting Agreement and the applicable Terms Agreement against payment
of the requisite consideration therefor, the Guarantee will constitute a
valid and legally binding obligation of the Company, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws of
general applicability relating to or affecting creditors' rights and to
general equity principals.
(17) Authorization of the Underlying Shares. The Underlying Shares
that may be issued upon the exchange of the Underwritten Securities have
been duly authorized and validly reserved for issuance by the Company
upon the exchange of the Underwritten Securities, and such Underlying
Shares, when so issued upon such exchange in accordance with the terms of
the Underwritten Securities and the Indenture, will be validly issued,
fully paid and non-assessable and will not be subject to preemptive or
other similar rights arising by operation of law, under the charter or
by-laws of the Company or under any agreement to which the Company, the
Operating Partnership or any Subsidiary is a party, or otherwise. No
holder of the Underling Shares will be subject to personal liability by
reason of being such a holder.
(18) Absence of Defaults and Conflicts. Neither the Operating
Partnership, the Company nor any Subsidiary is (A) in violation of its
charter, by-laws, certificate of limited partnership or partnership
agreement, limited liability company operating agreement or other
organizational document, as the case may be, or (B) in default in the
9
performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, deed of trust,
loan or credit agreement, note, lease or other agreement or instrument to
which any such entity is a party or by which any of them may be bound, or
to which any of its property or assets may be bound or subject
(collectively, "Agreements and Instruments"), except (with respect to
clause (B) only) for such defaults that would not result in a Material
Adverse Effect. The execution, delivery and performance of this
Underwriting Agreement, the applicable Terms Agreement, the Indenture,
the Common Stock Delivery Agreement and any other agreement or instrument
entered into or issued or to be entered into or issued by the Operating
Partnership and the Company in connection with the transactions
contemplated hereby or thereby or in the Registration Statement and the
Prospectus and the consummation of the transactions contemplated herein
and in the Registration Statement and the Prospectus (including the
issuance and sale of the Underwritten Securities, the issuance and
delivery, if applicable, of the Underlying Shares upon exchange of the
Underwritten Securities and the use of the proceeds from the sale of the
Underwritten Securities as described under the caption "Use of Proceeds")
and compliance by the Operating Partnership and the Company with their
obligations hereunder and thereunder have been duly authorized by all
necessary partnership and corporate action, respectively, and do not and
will not, whether with or without the giving of notice or passage of time
or both, conflict with or constitute a breach of, or default or Repayment
Event (as defined below) under, or result in the creation or imposition
of any lien, charge or encumbrance upon any assets, properties or
operations of the Operating Partnership, the Company or any Subsidiary
pursuant to, any Agreements and Instruments, except for such conflicts,
breaches, defaults, Repayment Events (as defined below) or liens, charges
or encumbrances that would not result in a Material Adverse Effect, nor
will such action result in any violation of the provisions of (A) the
charter, by-laws or the organizational documents of the Operating
Partnership, the Company or any Subsidiary or (B) any applicable law,
statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Operating Partnership, the Company or any
Subsidiary or any of their assets, properties or operations, except (with
respect to clause (B) only) for such violations that would not have a
Material Adverse Effect. As used herein, a "Repayment Event" means any
event or condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such holder's behalf)
the right to require the repurchase, redemption or repayment of all or a
material portion of such indebtedness by the Operating Partnership or any
Subsidiary.
(19) Absence of Labor Dispute. No labor dispute with the employees
of the Operating Partnership, the Company or any Subsidiary exists or, to
the knowledge of the Operating Partnership or the Company, is imminent,
and neither the Operating Partnership nor the Company is aware of any
existing or imminent labor disturbance by the employees of any of the
Operating Partnership's, the Company's or any Subsidiary's principal
suppliers, manufacturers, customers or contractors, which dispute or
disturbance, in either case, may reasonably be expected to result in a
Material Adverse Effect.
10
(20) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or by any court or governmental agency or
body, domestic or foreign, now pending, or to the knowledge of the
Operating Partnership or the Company threatened against or affecting the
Operating Partnership, the Company or any Subsidiary or any of their
respective assets, properties or operations or any officer or director of
the Company which is required to be disclosed in the Registration
Statement and the Prospectus (other than as stated therein), or which
might reasonably be expected to result in a Material Adverse Effect, or
which might reasonably be expected to materially and adversely affect the
consummation of this Underwriting Agreement, the applicable Terms
Agreement, the Indenture, the Common Stock Delivery Agreement or the
transactions contemplated herein or therein. The aggregate of all pending
legal or governmental proceedings to which the Operating Partnership, the
Company or any Subsidiary is a party or of which any of their respective
assets, properties or operations is the subject that are not described in
the Registration Statement and the Prospectus, including ordinary routine
litigation incidental to the business, could not reasonably be expected
to result in a Material Adverse Effect.
(21) Accuracy of Exhibits. There are no contracts or documents which
are required to be described in the Registration Statement, the
Prospectus or the documents incorporated by reference therein or to be
filed as exhibits thereto which have not been so described and/or filed
as required and the descriptions thereof or references thereto are
correct in all Material respects.
(22) REIT Qualification. Commencing with its taxable year ending
December 31, 1995 the Company has been, and upon the sale of the
applicable Underwritten Securities and upon exchange of the Underwritten
Securities for the Underlying Shares, if applicable, the Company will
continue to be, organized and operated in conformity with the
requirements for qualification and taxation as a real estate investment
trust under the Internal Revenue Code of 1986, as amended (the "Code"),
and its current and proposed method of operation will enable it to
continue to meet the requirements for qualification and taxation as a
real estate investment trust under the Code, and no actions have been
taken (or not taken which are required to be taken) which would cause
such qualification to be lost.
(23) Investment Company Act. Each of the Company, the Operating
Partnership and any Significant Subsidiary is not, and upon the issuance
and sale of the Underwritten Securities, and the issuance of the
Underlying Shares upon exchange of the Underwritten Securities, if
applicable, as herein contemplated and the application of the net
proceeds therefrom as described in the Prospectus will not be, an
"investment company" within the meaning of the Investment Company Act of
1940, as amended (the "1940 Act").
(24) Intellectual Property. To the knowledge of the Operating
Partnership and the Company, none of the Operating Partnership, the
Company nor any Subsidiary is required to own, possess or obtain the
consent of any holder of any trademarks, service marks, trade names or
copyrights not now lawfully owned, possessed or licensed in order to
conduct the business now operated by such entity, and none of the
Operating
11
Partnership, the Company or any Subsidiary has received any notice or is
otherwise aware of any infringement of or conflict with asserted rights
of others with respect to any such proprietary rights, which infringement
or conflict (if the subject of any unfavorable decisions, ruling or
finding) singly or in the aggregate would result in any Material Adverse
Effect.
(25) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
or any other entity or person is necessary or required for the
performance by the Operating Partnership and the Company of their
respective obligations under this Underwriting Agreement, the applicable
Terms Agreement, the Indenture, the Common Stock Delivery Agreement or in
connection with the transactions contemplated under this Underwriting
Agreement, such Terms Agreement or the Indenture, except such as have
been already obtained or as may be required under state securities laws
or under the by-laws and rules of the National Association of Securities
Dealers, Inc. (the "NASD") or under state securities or real estate
syndication laws.
(26) Possession of Licenses and Permits. Each of the Operating
Partnership, the Company and the Subsidiaries possesses such
certificates, permits, licenses, approvals, consents and other
authorizations (collectively, "Governmental Licenses") issued by the
appropriate federal, state, local or foreign regulatory agencies or
bodies necessary to conduct the business now operated by them except for
such Governmental Licenses, the failure to obtain would not, singly or in
the aggregate, result in a Material Adverse Effect. The Operating
Partnership, the Company and the Subsidiaries are in compliance with the
terms and conditions of all such Governmental Licenses, except where the
failure so to comply would not, singly or in the aggregate, result in a
Material Adverse Effect. All of the Governmental Licenses are valid and
in full force and effect, except where the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses to be
in full force and effect would not result in a Material Adverse Effect.
Neither the Operating Partnership, the Company nor any Subsidiary has
received any notice of proceedings relating to the revocation or
modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding,
would result in a Material Adverse Effect.
(27) Title to Property. The Operating Partnership, the Company, the
Subsidiaries or any joint venture partnership in which the Operating
Partnership or the Company owns an interest, as the case may be, have
good and marketable fee simple title or leasehold title, as the case may
be, to all real property and related improvements and other assets owned
or leased, or represented to be owned or leased, as applicable, by the
Operating Partnership, the Company, or the Subsidiaries, and good title
to all other properties owned by them, and any improvements thereon and
all other assets that are required for the effective operation of such
properties in the manner in which they currently are operated, free and
clear of all liens, encumbrances, claims, security interests and defects,
except such as are Permitted Encumbrances (as defined below). All liens,
charges, encumbrances, claims or restrictions on or affecting any of the
Properties and the assets of any of the Operating Partnership, the
Company, the Subsidiaries or any joint
12
venture partnership in which the Operating Partnership or the Company
owns an interest that are required to be disclosed in the Prospectus are
disclosed therein. Each of the Properties comply with all applicable
codes, laws and regulations and (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 Prospectus and
except for such failures to comply that would not in the aggregate have a
Material Adverse Effect. There are in effect for the assets of each of
the Operating Partnership, the Company, the Subsidiaries or any joint
venture partnership in which the Operating Partnership or the Company
owns an interest, insurance policies covering the risks and in amounts
that are commercially reasonable for the types of assets owned by them
and that are consistent with the types and amounts of insurance typically
maintained by prudent owners of properties similar to such assets in the
markets in which such assets are located, and none of the Operating
Partnership, the Company, the Subsidiaries or any joint venture
partnership in which the Operating Partnership or the Company owns an
interest has received from any insurance company notice of any material
defects or deficiencies affecting the insurability of any such assets or
any notices of cancellation or intent to cancel any such policies.
Neither the Operating Partnership nor the Company has any knowledge of
any pending or threatened litigation, moratorium, condemnation
proceedings, zoning change, or other similar proceeding or action that
could in any manner affect the size of, use of, improvements on,
construction on, access to or availability of utilities or other
necessary services to the Properties, except such proceedings or actions
that would not have a Material Adverse Effect. All of the leases and
subleases material to the business of the Operating Partnership, the
Company and the Subsidiaries considered as one enterprise, and under
which the Operating Partnership, the Company or any Subsidiary holds
Properties described in the Prospectus, are in full force and effect, and
neither the Operating Partnership, the Company nor any Subsidiary has
received any notice of any material claim of any sort that has been
asserted by anyone adverse to the rights of the Operating Partnership,
the Company or any Subsidiary under any of the leases or subleases
mentioned above, or affecting or questioning the rights of the Operating
Partnership, the Company or any Subsidiary of the continued possession of
the leased or subleased premises under any such lease or sublease.
"Permitted Encumbrance" shall mean (a) liens on certain Properties
securing any of the Operating Partnership, the Company, any Subsidiary or
joint venture partnership obligations, (b) other liens which are
expressly described in, or which are incorporated by reference into, the
Prospectus and (c) customary easements and encumbrances and other
exceptions to title which do not impair the operation, development or use
of the Properties for the purposes intended therefor as contemplated in
the Prospectus.
(28) Environmental Laws. Except as otherwise stated in the
Registration Statement and the Prospectus and except such violations as
would not, singly or in the aggregate, result in a Material Adverse
Effect, to the knowledge of the Operating Partnership, the Company and
any Subsidiary, as the case may be, after due inquiry, (A) none of the
the Operating Partnership, the Company nor any Subsidiary is in violation
of any federal, state, local or foreign statute, law, rule, regulation,
ordinance or code, policy or rule of common law and any judicial or
administrative interpretation thereof including any judicial or
administrative order, consent, or decree of judgment relating to
pollution or protection of human health, the environment (including,
without
13
limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) including, without limitation, laws and regulations
relating to the release or threatened release of chemicals, pollutants,
contaminants, wastes, toxic substances, hazardous substances, petroleum
or petroleum products (collectively, "Hazardous Materials") or to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials (collectively,
"Environmental Laws"); (B) the Operating Partnership, the Company and any
Subsidiaries have all permits, authorizations and approvals required
under any applicable Environmental Laws and are each in compliance with
their requirements; (C) there are no pending or threatened
administrative, regulatory or judicial actions, suits, demands, demand
letters, claims, liens, notices of noncompliance or violation,
investigation or proceedings pursuant to any Environmental Law against
the Operating Partnership, the Company or any Subsidiaries; and (D) there
are no events or circumstances that might reasonably be expected to form
the basis of an order for clean-up or remediation, or an action, suit or
proceeding by any private party or governmental body or agency, against
or affecting the Operating Partnership, the Company, any Subsidiary or
any of their assets relating to any Hazardous Materials or the violation
of any Environmental Laws.
(29) Tax Returns. Each of the Operating Partnership, the Company and
any Subsidiary has filed all federal, state, local and foreign income tax
returns which have been required to be filed (except in any case in which
an extension has been granted or the failure to so file would not have a
Material Adverse Effect) and has paid all taxes required to be paid and
any other assessment, fine or penalty levied against it, to the extent
that any of the foregoing is due and payable, except, in all cases, for
any such tax, assessment, fine or penalty that is being contested in good
faith.
(30) Environmental Consultants. None of the environmental
consultants which prepared environmental and asbestos inspection reports
with respect to certain of the Properties was employed for such purpose
on a contingent basis or has any substantial interest in the Company, the
Operating Partnership or any Subsidiary and none of them or any of their
directors, officers or employees is connected with the Company, the
Operating Partnership or any Subsidiary as a promoter, selling agent,
voting trustee, director, officer or employee.
(31) Title Insurance. The Operating Partnership, the Company and any
Subsidiary, as the case may be, have obtained title insurance on the fee
interests and leasehold interests in each of the Properties in an amount
at least equal to the greater of (A) the mortgage indebtedness on each
such Property and (B) the purchase price paid for each such Property (in
the case of any Property having been acquired by the Operating
Partnership via an exchange of Units for partnership interests in the
entity holding such property, the "purchase price" of such Property being
deemed to be the sum of (i) the per-share price of the Common Stock of
the Company on the date such Property was exchanged for Units multiplied
by the number of Units exchanged for such Property or interests in the
entity holding such Property and (ii) the amount of any assumed
indebtedness secured by such Property), except that Omni Partnership has
obtained title insurance insuring Omni Partnership's interest in its real
property assets in an amount not less than $48 million.
14
(32) Absence of Regulation M Violation. None of the Company, the
Operating Partnership, the Subsidiaries, nor any of their respective
directors, officers, members or controlling persons, has taken or will
take, directly or indirectly, any action resulting in a violation of
Regulation M under the 1934 Act, or designed to cause or result in, or
that has constituted or that reasonably might be expected to constitute,
the stabilization or manipulation of the price of any security of the
Operating Partnership or the Company to facilitate the sale or resale of
the Underwritten Securities.
(33) Sarbanes Oxley Act Compliance. There is and has been no failure
on the part of the Company and the Operating Partnership to comply in all
material respects with the provisions of the Sarbanes-Oxley Act of 2002
and the rules and regulations in connection therewith.
(b) Officers' Certificates. Any certificate signed by any authorized
representative of the Company, on behalf of the Company for itself and as
general partner of the Operating Partnership, and delivered to any Underwriter
or to counsel for the Underwriters in connection with the offering of the
Underwritten Securities shall be deemed a representation and warranty by such
entity or person, as the case may be, to each Underwriter as to the matters
covered thereby on the date of such certificate and, unless subsequently
amended or supplemented, at each Representation Date subsequent thereto.
SECTION 2. Sale and Delivery to Underwriters; Closing.
------------------------------------------
(a) Underwritten Securities. The several commitments of the Underwriters
to purchase the Underwritten Securities pursuant to the applicable Terms
Agreement shall be deemed to have been made on the basis of the
representations and warranties herein contained and shall be subject to the
terms and conditions herein set forth.
(b) Option Underwritten Securities. If so provided in the applicable
Terms Agreement and subject to the terms and conditions set forth therein, the
Operating Partnership and the Company may grant an option to the Underwriters,
severally and not jointly, to purchase up to the aggregate principal amount of
the Option Underwritten Securities set forth therein at a price per Option
Underwritten Security equal to the price per Initial Underwritten Security,
less an amount equal to any interest paid or payable on the Initial
Underwritten Securities but not payable on the Option Underwritten Securities.
Such option, if granted, will expire 30 days after the date of such Terms
Agreement, and may be exercised in whole or in part from time to time only for
the purpose of covering over-allotments which may be made in connection with
the offering and distribution of the Initial Underwritten Securities upon
notice by the Representative to the Operating Partnership setting forth the
aggregate principal amount of Option Underwritten Securities as to which the
several Underwriters are then exercising the option and the time, date and
place of payment and delivery for such Option Underwritten Securities. Any
such time and date of payment and delivery (each, a "Date of Delivery") shall
be determined by the Representative, but shall not be later than seven full
business days after the exercise of said option, nor in any event prior to the
Closing Time, unless otherwise agreed upon by the Representative and the
Operating Partnership and the Company. If the option is exercised as to all or
any portion of the Option Underwritten Securities, each of the Underwriters,
severally and not jointly, will purchase that proportion of the total
aggregate principal amount of Option
15
Underwritten Securities then being purchased which the aggregate principal
amount of Initial Underwritten Securities each such Underwriter has severally
agreed to purchase as set forth in such Terms Agreement bears to the total
aggregate principal amount of Initial Underwritten Securities, subject to such
adjustments as the Representative in its discretion shall make to eliminate
any sales or purchases of a fractional aggregate principal amount of Option
Underwritten Securities.
(c) Payment. Payment of the purchase price for, and delivery of, the
Initial Underwritten Securities shall be made at the office of Sidley Austin
Brown & Wood LLP, or at such other place as shall be agreed upon by the
Representative and the Operating Partnership and the Company, at 10:00 a.m.
(Eastern time) on the third (fourth, if the pricing occurs after 4:30 p.m.
(Eastern time) on any given day) business day after the date of the applicable
Terms Agreement (unless postponed in accordance with the provisions of Section
10 hereof), or such other time not later than ten business days after such
date as shall be agreed upon by the Representative and the Operating
Partnership and the Company (such time and date of payment and delivery being
herein called "Closing Time"). In addition, in the event that the Underwriters
have exercised their option, if any, to purchase any or all of the Option
Underwritten Securities, payment of the purchase price for, and delivery of
such Option Underwritten Securities, shall be made at the above-mentioned
offices of Sidley Austin Brown & Wood LLP, or at such other place as shall be
agreed upon by the Representative and the Operating Partnership and the
Company on the relevant Date of Delivery as specified in the notice from the
Representative to the Operating Partnership and the Company.
Payment shall be made to the Operating Partnership by wire transfer of
Federal funds or similar same day funds payable to the order of the Operating
Partnership against delivery to the Representative for the respective accounts
of the Underwriters of the Underwritten Securities to be purchased by them. It
is understood that each Underwriter has authorized the Representative, for
their account, to accept delivery of, receipt for, and make payment of the
purchase price for, the Underwritten Securities which it has severally agreed
to purchase. The Representative, individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the Underwritten Securities to be purchased by any Underwriter whose
check has not been received by the Closing Time or the relevant Date of
Delivery, as the case may be, but such payment shall not relieve such
Underwriter from its obligations hereunder.
(d) Denominations; Registration. The Underwritten Securities shall be in
such denominations and registered in such names as the Representative may
request in writing at least one full business day prior to the Closing Time or
the relevant Date of Delivery, as the case may be. The Underwritten Securities
will be made available for examination and packaging by the Representative in
The City of New York not later than 10:00 a.m. (Eastern time) on the business
day prior to the Closing Time or the relevant Date of Delivery, as the case
may be.
SECTION 3. Covenants of the Operating Partnership and the Company.
------------------------------------------------------
Each of the Operating Partnership and the Company, jointly and severally,
covenants with the Representative and with each Underwriter participating in
the offering of Underwritten Securities, as follows:
16
(a) Compliance with Securities Regulations and Commission Requests. The
Operating Partnership and the Company, subject to Section 3(b), will comply
with the requirements of the 1933 Act Regulations, including Rule 430A and
Rule 434, and will notify the Representative immediately, and confirm the
notice in writing, of (i) the effectiveness of any post-effective amendment to
the Registration Statement or the filing of any supplement or amendment to the
Prospectus, (ii) the receipt of any comments from the Commission, (iii) any
request by the Commission for any amendment to the Registration Statement or
any amendment or supplement to the Prospectus or for additional information,
and (iv) the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing or
suspending the use of any preliminary prospectus, or of the suspension of the
qualification of the Underwritten Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceedings for any
of such purposes. The Operating Partnership and the Company will promptly
effect the filings necessary pursuant to Rule 424 and will take such steps as
they deem necessary to ascertain promptly whether the Prospectus transmitted
for filing under Rule 424 was received for filing by the Commission and, in
the event that it was not, will promptly file the Prospectus. The Operating
Partnership and the Company will make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) Filing of Amendments. At any time when the Prospectus is required to
be delivered under the 1933 Act or the 1934 Act in connection with sales of
the Underwritten Securities, the Operating Partnership and the Company will
give the Representative notice of their intention to file or prepare any
amendment to the Registration Statement (including any filing under Rule
462(b) of the 1933 Act Regulations), any Term Sheet or any amendment,
supplement or revision to either the prospectus included in the Registration
Statement at the time it became effective or to the Prospectus, whether
pursuant to the 1933 Act, the 1934 Act or otherwise, will furnish the
Representative with copies of any such documents a reasonable amount of time
prior to such proposed filing or use, as the case may be, and will not file or
use any such document to which the Representative or counsel for the
Underwriters shall reasonably object.
(c) Delivery of Registration Statements. The Operating Partnership and
the Company have furnished or will deliver to the Representative and counsel
for the Underwriters, without charge, a signed copy of the Registration
Statement as originally filed and of each amendment thereto (including
exhibits filed therewith or incorporated by reference therein and documents
incorporated or deemed to be incorporated by reference therein) and signed
copies of all consents and certificates of experts, and will also deliver to
the Representative and counsel for the Underwriters, without charge, conformed
copies of the Registration Statement as originally filed and of each amendment
thereto for each of the Underwriters. If applicable, the copies of the
Registration Statement and each amendment thereto furnished to the
Underwriters will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Operating Partnership and the Company
will deliver to each Underwriter, without charge, as many copies of each
preliminary prospectus as such Underwriter may reasonably request, and the
Operating Partnership and the Company hereby consent to the use of such copies
for purposes permitted by the 1933 Act. The Operating Partnership and the
Company will furnish to each Underwriter, without charge, during the period
17
when the Prospectus is required to be delivered under the 1933 Act or the 1934
Act and prior to 4:00 p.m. New York City time on the New York business day
next succeeding the date of the applicable Terms Agreement, such number of
copies of the Prospectus as such Underwriter may reasonably request. If
applicable, the Prospectus and any amendments or supplements thereto furnished
to the Underwriters will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Operating Partnership
and the Company will comply with the 1933 Act and the 1933 Act Regulations and
the 1934 Act and the 1934 Act Regulations so as to permit the completion of
the distribution of the Underwritten Securities as contemplated in this
Underwriting Agreement and the applicable Terms Agreement and in the
Registration Statement and the Prospectus. If at any time when the applicable
preliminary prospectus or Prospectus is required by the 1933 Act or the 1934
Act to be delivered in connection with sales of the Underwitten Securities,
any event shall occur or condition shall exist as a result of which it is
necessary, in the opinion of counsel for the Underwriters or for the Operating
Partnership and the Company, to amend the Registration Statement in order that
the Registration Statement will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or to amend or
supplement the applicable preliminary prospectus or Prospectus in order that
the applicable preliminary prospectus or Prospectus will not include an untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser, or if it
shall be necessary, in the opinion of such counsel, at any such time to amend
the Registration Statement or amend or supplement the applicable preliminary
prospectus or Prospectus in order to comply with the requirements of the 1933
Act or the 1933 Act Regulations, the Operating Partnership and the Company
will promptly prepare and file with the Commission, subject to Section 3(b),
such amendment or supplement as may be necessary to correct such statement or
omission or to make the Registration Statement, applicable preliminary
prospectus or the Prospectus comply with such requirements, and the Operating
Partnership and the Company will furnish to the Underwriters and counsel for
the Underwriters, without charge, such number of copies of such amendment or
supplement as the Underwriters may reasonably request.
(f) Blue Sky Qualifications. The Operating Partnership and the Company
will use their best efforts, in cooperation with the Underwriters, to qualify
the Underwritten Securities for offering and sale under the applicable
securities laws of such states and other jurisdictions (domestic or foreign)
as the Representative may designate and to maintain such qualifications in
effect for a period of not less than one year from the date of the applicable
Terms Agreement; provided, however, that the Operating Partnership and the
Company shall not be obligated to file any general consent to service of
process or to qualify or register as a foreign corporation or as a dealer in
securities in any jurisdiction in which it is not so qualified or registered,
or to subject itself to taxation in respect of doing business in any
jurisdiction in which it is not otherwise so subject. In each jurisdiction in
which the Underwritten Securities have been so qualified or registered, the
Operating Partnership and the Company will file such statements and reports as
may be required by the laws of such jurisdiction to continue such
qualification in effect for a period of not less than one year from the date
of such Terms Agreement.
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(g) Earnings Statement. The Operating Partnership and the Company will
timely file such reports pursuant to the 1934 Act as are necessary in order to
make generally available to their security holders as soon as practicable an
earnings statement (in form complying with Rule 158 of the 1933 Act
Regulations) for the purposes of, and to provide the benefits contemplated by,
the last paragraph of Section 11(a) of the 1933 Act.
(h) Reporting Requirements. The Operating Partnership and the Company,
during the period when the Prospectus is required to be delivered under the
1933 Act or the 1934 Act, will file all documents required to be filed with
the Commission pursuant to the 1934 Act within the time periods required by
the 1934 Act and the 1934 Act Regulations.
(i) REIT Qualification. The Company will use its best efforts to continue
to meet the requirements for qualification as a "real estate investment trust"
under the Code for each of its current and subsequent taxable years.
(j) Use of Proceeds. The Operating Partnership and the Company will use
the net proceeds received from the sale of the Underwritten Securities in the
manner specified in the Prospectus under "Use of Proceeds."
(k) Exchange Act Filings. During the period from each Closing Time until
June 30, 2006, the Operating Partnership will deliver to the Representative,
(i) promptly upon their becoming available, copies of all current, regular and
periodic reports of the Operating Partnership and the Company mailed to
unitholders and shareholders, respectively, that are not filed with any
securities exchange or with the Commission or any governmental authority
succeeding to any of the Commission's functions, and (ii) such other
information concerning the Operating Partnership and the Company as the
Representative may reasonably request.
(l) No Manipulation of Market for Securities. Except for the
authorization of actions permitted to be taken by the Underwriters as
contemplated herein or in the Prospectus, the Operating Partnership and the
Company will not (a) take, directly or indirectly, any action designed to
cause or to result in, or that might reasonably be expected to constitute, the
stabilization or manipulation of the price of any security of the Operating
Partnership or the Company to facilitate the sale or resale of the
Underwritten Securities, and (b) until the Closing Date, or the Date of
Delivery, if any, (i) sell, bid for or purchase the Underwritten Securities or
pay any person any compensation for soliciting purchases of the Underwritten
Securities or (ii) pay or agree to pay to any person any compensation for
soliciting another to purchase any other securities of the Operating
Partnership.
(m) Rule 462(b) Registration Statement. If the Operating Partnership and
the Company elect to rely upon Rule 462(b), the Operating Partnership and the
Company shall file a Rule 462(b) Registration Statement with the Commission in
compliance with Rule 462(b) by 10:00 p.m., New York City time, on the date of
this Agreement, and the Company shall at the time of filing either pay to the
Commission the filing fee for the Rule 462(b) Registration Statement or give
irrevocable instructions for the payment of such fee pursuant to Rule 111(b)
under the 1933 Act.
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(n) Reservation of Securities. The Company will reserve and keep
available at all times, free of preemptive rights, a sufficient number of
shares of Common Stock for the purpose of enabling the Company to satisfy any
obligations to issue Underlying Shares upon the exchange of the Underwritten
Securities.
(o) Listing. The Company will use its best efforts to effect and maintain
the listing of the Underlying Shares, prior to issuance, on the New York Stock
Exchange or such other national securities exchange on which the Company's
shares of Common Stock are then listed.
(p) Lock-Up. From the date of the Prospectus and for a period of 30 days
thereafter, the Company and the Operating Partnership will not, directly or
indirectly: (1) offer for sale, sell, contract to sell, pledge, hedge or
otherwise dispose of (or enter into any transaction or device which is
designed to, or could be expected to, result in the disposition by any person
at any time in the future of), any Common Stock (other than the Underlying
Shares, shares issued pursuant to the stock option plans, Long-Term Incentive
Plan and/or distribution reinvestment plans of the Company existing on the
date hereof, shares issued in connection with the acquisition of real property
or interests therein, including mortgage or leasehold interests or in
conjunction with any joint venture transaction to which the Company, the
Operating Partnership or an affiliate of the Company or Operating Partnership
is or becomes a party, or shares issued in connection with the conversion or
redemption of partnership units of the Operating Partnership by holders of
such), any securities which are substantially similar to the Underwritten
Securities or the Common Stock or any such securities convertible,
exchangeable or exercisable for Common Stock or any securities which are
substantially similar to the Underwritten Securities or the Common Stock, or
(2) enter into any swap or other derivatives transaction that transfers to
another, in whole or in part, any of the economic benefits or risks of
ownership of such securities (whether any such transaction described in clause
(1) or (2) above is to be settled by delivery of such securities or other
securities, in cash or otherwise), or (3) publicly disclose an intention to
make any such offer, sale, pledge, hedge, swap or other transaction, in each
case without the prior written consent of Citigroup Global Markets Inc.
SECTION 4. Payment of Expenses.
-------------------
(a) Expenses. The Operating Partnership and the Company, jointly and
severally, will pay all expenses incident to the performance of respective
obligations under this Underwriting Agreement and each applicable Terms
Agreement and the Common Stock Delivery Agreement, including (i) the
preparation, printing and filing of the Registration Statement (including
financial statements and exhibits) as originally filed and of each amendment
thereto, (ii) the printing and delivery to the Underwriters of this
Underwriting Agreement, any Terms Agreement, any Agreement among Underwriters,
the Indenture and such other documents as may be required in connection with
the offering, purchase, sale and delivery of the Underwritten Securities and
the Underlying Shares that may be issued upon exchange of Underwritten
Securities, (iii) the preparation, issuance and delivery of the Underwritten
Securities to the Underwriters and the Underlying Shares that may be issued
upon exchange of the Underwritten Securities, (iv) the fees and disbursements
of the Operating Partnership's and the Company's counsel, accountants and
other advisors or agents (including transfer agents and registrars), as well
as the fees and disbursements of any trustee or its agents under any Indenture
and their respective counsel, (v) the qualification of the Underwritten
Securities and the Underlying
20
Shares that may be issued upon exchange of the Underwritten Securities under
state securities and real estate syndication laws in accordance with the
provisions of Section 3(f) hereof, including filing fees and the reasonable
fees and disbursements of counsel for the Underwriters in connection therewith
and in connection with the preparation, printing and delivery of the Blue Sky
Survey, (vi) the printing and delivery to the Underwriters of copies of each
preliminary prospectus, any Term Sheet, the Registration Statement (including
financial statements and exhibits) as originally filed and of each amendment
thereto and the Prospectus and any amendments or supplements thereto, (vii)
the fees charged by nationally recognized statistical rating organizations for
the rating of the Underwritten Securities, (viii) the fees and expenses
incurred with respect to the listing of the Underlying Shares, (ix) the fees
and expenses of any Underwriter acting in the capacity of a "qualified
independent underwriter" (as defined in Rule 2720(a)(15) of the Conduct Rules
of the NASD), if applicable, and (x) all other costs and expenses incident to
the performance of its obligations hereunder which are not otherwise
specifically provided for in this Section.
(b) Termination of Agreement. If the applicable Terms Agreement is
terminated by the Representative in accordance with the provisions of Section
5 or Section 9(b) hereof, the Operating Partnership and the Company, jointly
and severally, shall reimburse the Underwriters for all of their out-of-pocket
expenses, including the reasonable fees and disbursements of counsel for the
Underwriters.
SECTION 5. Conditions of Underwriters' Obligations.
---------------------------------------
The obligations of the Underwriters to purchase and pay for the
Underwritten Securities pursuant to the applicable Terms Agreement are subject
to the accuracy of the representations and warranties of the Operating
Partnership and the Company contained in Section 1 hereof or in certificates
of any officer or authorized representative of the Operating Partnership and
the Company delivered pursuant to the provisions hereof, to the performance by
the Operating Partnership and the Company of their respective covenants and
other obligations hereunder, and to the following further conditions:
(a) Effectiveness of Registration Statement. The Registration Statement
has become effective under the 1933 Act (and in the case of a Rule 462(b)
Registration Statement such Registration Statement shall have become effective
by 10:00 p.m. New York City time on the date of this Agreement) and no stop
order suspending the effectiveness of the Registration Statement shall have
been issued under the 1933 Act or proceedings therefor initiated or threatened
by the Commission or the state securities authority of any jurisdiction, and
any request on the part of the Commission or the state securities authority of
any jurisdiction for additional information shall have been complied with to
the reasonable satisfaction of counsel to the Underwriters. A prospectus
containing information relating to the description of the Underwritten
Securities and the Underlying Shares, the specific method of distribution and
similar matters shall have been filed with the Commission in accordance with
Rule 424(b)(1), (2), (3), (4) or (5), as applicable (or any required
post-effective amendment providing such information shall have been filed and
declared effective in accordance with the requirements of Rule 430A), or, if
the Operating Partnership and the Company have elected to rely upon Rule 434
of the 1933 Act Regulations, a Term Sheet including the Rule 434 Information
shall have been filed with the Commission in accordance with Rule 424(b)(7).
21
(b) Opinion of Counsel for the Operating Partnership and the Company. (i)
At Closing Time, the Representative shall have received the favorable opinion,
dated as of Closing Time, of Sidley Austin Brown & Wood LLP, counsel for the
Operating Partnership and the Company, in form and substance satisfactory to
counsel for the Underwriters, together with signed or reproduced copies of
such letter for each of the other Underwriters, such opinion shall address
such of the items set forth in Exhibit C hereto as may be relevant to the
particular offering contemplated or to such further effect as counsel to the
Underwriters may reasonably request.
(ii) At Closing Time, the Representative shall have received the
favorable opinion, dated as of Closing Time, of Solomon and Weinberg LLP,
special tax counsel for the Operating Partnership and the Company, to the
effect that:
(A) at all times since January 1, 2000, the Company has been organized
and operated in conformity with the requirements for qualification and
taxation as a real estate investment trust under the Code and the proposed
method of operation of the Company will enable the Company to continue to meet
the requirements for qualification and taxation as a real estate investment
trust under the Code; and
(B) the information in the Prospectus Supplement under "Certain Federal
Income Tax Consequences" and in the Prospectus under "Material Federal Income
Tax Consequences" has been reviewed by such counsel and is correct in all
material respects.
(c) Opinion of Counsel for Underwriters. At Closing Time, the
Representative shall have received the favorable opinion, dated as of Closing
Time, of Clifford Chance US LLP, counsel for the Underwriters, or such other
counsel as may be designated by the Representative together with signed or
reproduced copies of such letter for each of the other Underwriters, with
respect to the matters set forth in (1) (with respect to the first clause of
the first sentence only), (2) (with respect to the first clause of the first
sentence only), (6), (7), (8), (11) (with respect to the Prospectus Supplement
only and not inclusive of any tax disclosure), and (17) of Exhibit C hereto
and the last two paragraphs of Exhibit C hereto. In giving such opinion, such
counsel may rely, as to all matters governed by the laws of jurisdictions
other than the law of the State of New York, the federal law of the United
States and the General Corporation Law of the State of Delaware, upon the
opinions of counsel satisfactory to the Representative. Such counsel may also
state that, insofar as such opinion involves factual matters, they have
relied, to the extent they deem proper, upon certificates of authorized
representatives of the Operating Partnership and the Company and certificates
of public officials.
(d) Officers' Certificate. At Closing Time, there shall not have been,
since the date of the applicable Terms Agreement or since the respective dates
as of which information is given in the Prospectus, any material adverse
change in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Operating Partnership, the Company or any
Subsidiary considered as one enterprise, whether or not arising in the
ordinary course of business, and the Representative shall have received a
certificate of the President or a Vice President of the Company, on its own
behalf and as general partner of the Operating Partnership, and of the chief
financial officer or chief accounting officer of the Company, on its own
behalf and as general partner of the Operating Partnership, dated as of
Closing Time, to the effect that (i) there has been no such material adverse
change, (ii) the representations and warranties in
22
Section 1 are true and correct, in all material respects, with the same force
and effect as though expressly made at and as of the Closing Time, (iii) the
Company and Operating Partnership have complied with all agreements and
satisfied all conditions on their respective parts to be performed or
satisfied at or prior to the Closing Time and (iv) no stop order suspending
the effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been initiated or threatened by the
Commission or by the state securities authority of any jurisdiction.
(e) Accountant's Comfort Letter. At the Closing Time, the Representative
shall have received from Ernst & Young LLP a letter, dated such date, in form
and substance satisfactory to the Representative and counsel to the
Underwriters, together with signed or reproduced copies of such letter for
each of the other Underwriters, containing statements and information of the
type ordinarily included in accountants' "comfort letters" as set forth in the
PCAOB's Statement on Auditing Standards 100 to underwriters with respect to
the financial statements and certain financial information contained in the
Registration Statement and the Prospectus.
(f) Bring-down Comfort Letter. At Closing Time, the Representative shall
have received from Ernst & Young LLP a letter, dated as of Closing Time, to
the effect that they reaffirm the statements made in the letter furnished
pursuant to subsection (e) of this Section 5, except that the specified date
referred to shall be a date not more than three business days prior to the
Closing Time.
(g) Ratings. The Underwritten Securities shall be rated at least Baa3 by
Moody's Investors Service, Inc. and BBB by Standard & Poor's Rating Service,
and as soon as practicable after the Closing Time, the Operating Partnership
and the Company shall have delivered to the Underwriters a letter from each
such rating agency, or other evidence satisfactory to the Representative,
confirming that the Underwritten Securities have such ratings. Since the time
of execution of such Terms Agreement, there shall not have occurred a
downgrading in the rating assigned to the Underwritten Securities or any of
the Operating Partnership's and the Company's other securities by any such
rating organization, and no such rating organization shall have publicly
announced that it has under surveillance or review, with possible negative
implications, its rating of the Underwritten Securities or any of the
Operating Partnership's or the Company's other securities.
(h) Over-Allotment Option. In the event that the Underwriters are granted
an over-allotment option by the Operating Partnership and the Company in the
applicable Terms Agreement and the Underwriters exercise their option to
purchase all or any portion of the Option Underwritten Securities, the
representations and warranties of the Operating Partnership and the Company
contained herein and the statements in any certificates furnished by the
Operating Partnership and the Company hereunder shall be true and correct as
of each Date of Delivery, and, at the relevant Date of Delivery, the
Representative shall have received:
(1) A certificate dated such Date of Delivery, of the President or a
Vice President of the Company, on its own behalf and as general partner
of the Operating Partnership, and the chief financial officer or chief
accounting officer of the Company, on its own behalf and as general
partner of the Operating Partnership, confirming that the certificate
23
delivered at the Closing Time pursuant to Section 5(d) hereof remains
true and correct as of such Date of Delivery.
(2) The favorable opinion of Sidley Austin Brown & Wood LLP, counsel
for the Operating Partnership and the Company, in form and substance
satisfactory to counsel for the Underwriters, dated such Date of
Delivery, relating to the Option Underwritten Securities and otherwise to
the same effect as the opinion required by Section 5(b)(i) hereof.
(3) The favorable opinion of Clifford Chance US LLP, counsel for the
Underwriters, dated such Date of Delivery, relating to the Option
Underwritten Securities and otherwise to the same effect as the opinion
required by Section 5(c) hereof.
(4) A letter from Ernst & Young LLP, in form and substance
satisfactory to the Representative and dated such Date of Delivery, to
the effect that they reaffirm the statements made in the letter furnished
pursuant to subsection (e) of this Section 5, except that the "specified
date" on the letter furnished pursuant to this paragraph shall be a date
not more than three business days prior to such Date of Delivery.
(5) The favorable opinion of Solomon and Weinberg LLP, special tax
counsel for the Operating Partnership and the Company, in form and
substance satisfactory to counsel for the Underwriters, dated such Date
of Delivery, relating to the Option Underwritten Securities and otherwise
to the same effect as the opinion required by Section 5(b)(ii) hereof.
(i) Additional Documents. At Closing Time and at each Date of Delivery,
counsel for the Underwriters shall have been furnished with such documents and
opinions as they may require for the purpose of enabling them to pass upon the
issuance and sale of the Underwritten Securities as herein contemplated, or in
order to evidence the accuracy of any of the representations or warranties, or
the fulfillment of any of the conditions, herein contained.
(j) Termination of Terms Agreement. If any condition specified in this
Section 5 shall not have been fulfilled when and as required to be fulfilled,
the applicable Terms Agreement (or, with respect to the Underwriters' exercise
of any applicable over-allotment option for the purchase of Option
Underwritten Securities on a Date of Delivery after the Closing Time, the
obligations of the Underwriters to purchase the Option Underwritten Securities
on such Date of Delivery) may be terminated by the Representative by notice to
the Operating Partnership and the Company at any time at or prior to the
Closing Time (or such Date of Delivery, as applicable), and such termination
shall be without liability of any party to any other party except as provided
in Section 4, and except that Sections 1, 6 and 7 shall survive any such
termination and remain in full force and effect.
(k) Lock-Up Agreements. On the date of the applicable Terms Agreement,
the Representative shall have received, in form and substance satisfactory to
them, each Lock-Up Agreement, if any, specified in such Terms Agreement as
being required to be delivered by the persons or entities listed therein.
24
SECTION 6. Indemnification.
---------------
(a) Indemnification of Underwriters. The Operating Partnership and the
Company, jointly and severally, agree to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the 1933 Act, and any director, officer, employee or
affiliate thereof, as follows:
(1) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), including the information deemed to
be part of the Registration Statement pursuant to Rule 430A(b) of the
1933 Act Regulations, if applicable, or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary
to make the statements therein not misleading or arising out of any
untrue statement or alleged untrue statement of a material fact contained
in any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto) or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
(2) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation or of any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever for which indemnification is provided under subsection (1)
above, if such settlement is effected with the written consent of the
indemnifying party, which consent shall not be unreasonably withheld; and
(3) against any and all expense whatsoever (including without
limitation, the fees and disbursements of counsel chosen by the
Representative) reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceedings by
any governmental agency or body, commenced or threatened, or any claim
whatsoever for which indemnification is provided under subsection (1)
above, to the extent that any such expense is not paid under subsection
(1) or (2) above; provided, however, that the indemnity agreement
provided for in this Section 6(a) shall not apply to any loss, liability,
claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with written information furnished to the
Operating Partnership and the Company by any Underwriter through the
Representative expressly for use in the Registration Statement (or any
amendment thereto) or any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto); provided, however, that neither the
Company nor the Operating Partnership shall be required to indemnify any
Underwriter with respect to any preliminary prospectus to the extent that
any loss, claim, damage or expense of such Underwriter results solely
from an untrue statement of a material fact contained in, or the omission
of a material fact from, such preliminary prospectus which untrue
statement or omission was corrected in the Prospectus and identified to
such Underwriter in writing and which corrected Prospectus was furnished
by the Operating Partnership and the Company to such Underwriter pursuant
to Section 3(d) hereof but it shall be established that such Prospectus
was not sent or given by such
25
Underwriter to the purchaser of the Underwritten Securities at or prior
to the written confirmation of such sale and such correction would have
cured the defect giving rise to such loss, claim, damage or expense.
(b) Indemnification of the Operating Partnership and the Company. Each
Underwriter severally and not jointly agrees to indemnify and hold harmless
the Operating Partnership and the Company, and each person, if any, who
controls the Operating Partnership and the Company within the meaning of
Section 15 of the 1933 Act, and any employee or affiliate thereof, against any
and all loss, liability, claim, damage, and expense described in the indemnity
contained in subsection (a) of this Section 6, as incurred, but only with
respect to untrue statements or omissions, or alleged untrue statements or
omissions, made in the Registration Statement (or any amendment thereto) or
any preliminary prospectus or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information furnished
to the Operating Partnership and the Company by such Underwriter through the
Representative expressly for use in the Registration Statement (or any
amendment thereto) or any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto).
(c) Actions against Parties; Notification; Settlement without Consent if
Failure to Reimburse. Each indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder, but failure
so to notify an indemnifying party shall not relieve such indemnifying party
from any liability which it may have otherwise than on account of this
indemnity agreement. An indemnifying party may participate at its own expense
in the defense of such action. If it so elects within a reasonable time after
receipt of such notice, an indemnifying party, jointly with any other
indemnifying parties receiving such notice, may assume the defense of such
action with counsel chosen by it and reasonably approved by the other
indemnifying parties defendant in such action and reasonably approved by the
indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to an indemnifying party), unless such other indemnifying
parties or an indemnified party reasonably object to such assumption on the
ground that the named parties to any such action (including any impleaded
parties) include both such indemnified party and an indemnifying party, and
such indemnified party reasonably believes that there may be legal defenses
available to it which are different from or in addition to those available to
such indemnifying party. If an indemnifying party assumes the defense of such
action, the indemnifying parties shall not be liable for any fees and expenses
of counsel for the indemnified parties incurred thereafter in connection with
such action. In no event shall the indemnifying parties be liable for fees and
expenses of more than one counsel (in addition to any local counsel) separate
from their own counsel for all indemnified parties in connection with any one
action or separate but similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances. No indemnifying
party shall, without the written consent of the indemnified party, effect the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgement (i) includes an unconditional
release of the indemnified party from all liability arising out of such action
or claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of any indemnified party.
26
SECTION 7. Contribution.
------------
In order to provide for just and equitable contribution in circumstances
in which the indemnity agreement provided for in Section 6 hereof is for any
reason unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, the Operating Partnership and the Company, on the one hand, and the
Underwriters, on the other, shall contribute to the aggregate losses,
liabilities claims, damages and expenses of the nature contemplated by said
indemnity agreement incurred by the Operating Partnership, the Company and the
Underwriters, as incurred, in such proportions that the Underwriters are
responsible for that portion represented by the percentage that the
underwriting discount appearing on the cover page of the Prospectus bears to
the initial public offering price appearing thereon and the Operating
Partnership and the Company are responsible for the balance. 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 6(c) above, then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits allocation referred to
in the first sentence of this Section 7 but also the relative fault of the
Operating Partnership and the Company, 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 in respect thereof),
as well as any other relevant equitable considerations. 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
Operating Partnership, on the one hand, or such Underwriters, on the other,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Operating
Partnership, the Company and the Underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 7 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 7. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to
above in this Section 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
Section 7, no Underwriter shall be required to contribute any amount in excess
of the amount by which the total price at which the applicable Underwritten
Securities underwritten by it and distributed to the public were offered to
the public exceeds the amount of any damages which such Underwriter has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. Notwithstanding the foregoing, no
person guilty of fraudulent misrepresentation (within the meaning of section
11(f) of the 1933 Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation. For purposes of this
Section, each person, if any, who controls an Underwriter within the meaning
of Section 15 of the 1933 Act shall have the same rights to contribution as
such Underwriter, and each employee or affiliate of the Operating Partnership
and each director of the Company, each officer of the Company who signed the
Registration Statement and each person, if any, who controls either the
Operating Partnership or the Company, within the meaning of Section 15 of the
1933 Act shall have the same rights to contribution as the Operating
Partnership and the Company.
27
The Underwriters' obligations to contribute pursuant to this Section 7
are several in proportion to their respective underwriting commitments and not
joint.
SECTION 8. Representations, Warranties and Agreements to Survive
-----------------------------------------------------
Delivery.
- --------
All representations, warranties and agreements contained in this
Underwriting Agreement or the applicable Terms Agreement or in certificates of
officers of the Company, on behalf of the Company and as general partner of
the Operating Partnership, submitted pursuant hereto or thereto shall remain
operative and in full force and effect, regardless of any investigation made
by or on behalf of any Underwriter or controlling person, or by or on behalf
of the Operating Partnership and the Company, and shall survive delivery of
and payment for the Underwritten Securities.
SECTION 9. Termination.
-----------
(a) Underwriting Agreement. This Underwriting Agreement (excluding the
applicable Terms Agreement) may be terminated for any reason at any time by
the Operating Partnership, the Company or by the Representative upon the
giving of 30 days' prior written notice of such termination to the other party
hereto.
(b) Terms Agreement. The Representative may terminate the applicable
Terms Agreement, by notice to the Operating Partnership and the Company, at
any time at or prior to the Closing Time or any relevant Date of Delivery, if
(i) there has been, since the time of execution of such Terms Agreement or
since the respective dates as of which information is given in the Prospectus,
any material adverse change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of the Operating
Partnership, the Company and any Subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business, in each case the
effect of which is such as to make it, in the judgment of the Representative,
impracticable or inadvisable to market the Underwritten Securities, or (ii)
there has occurred any material adverse change in the financial markets in the
United States or internationally or any outbreak or escalation of hostilities
or acts of terrorism involving the United States or there is a declaration by
the United States of a national emergency or war or escalation thereof or
other calamity or crisis, or any change or development involving a prospective
change in national or international political, financial, or economic
conditions, in each case the effect of which is such as to make it, in the
sole judgment of the Representative, impracticable or inadvisable to proceed
with the offering or delivery of the Underwritten Securities or to enforce
contracts for the sale of the Underwritten Securities, or (iii) trading in any
securities of the Company or the Operating Partnership has been suspended or
limited by the Commission or the New York Stock Exchange, or if trading in
securities generally on the New York Stock Exchange or the American Stock
Exchange or in the over-the-counter market has been suspended or limited, or
minimum or maximum prices for trading have been fixed, or maximum ranges for
prices have been required, by either of said exchanges or by such system or by
order of the Commission, the NASD or any other governmental authority, or (iv)
a banking moratorium has been declared by either federal or New York state
authorities, or a material disruption in clearance or settlement systems has
occurred.
28
(c) Liabilities. If this Underwriting Agreement or the applicable Terms
Agreement is terminated pursuant to this Section 9, such termination shall be
without liability of any party to any other party except as provided in
Section 4 hereof; provided that Sections 1, 6, 7, 8 and 13 hereof shall
survive such termination and remain in full force and effect.
SECTION 10. Intentionally Omitted.
---------------------
SECTION 11. Notices.
-------
All notices and other communications hereunder shall be in writing and
shall be deemed to have been duly given or transmitted by any standard form of
telecommunication. Notices to the Underwriters shall be directed as provided
in a Terms Agreement, and notices to the Operating Partnership and the Company
shall be directed to them at 225 Broadhollow Road, Melville, New York 11747,
attention of Scott H. Rechler, Chief Executive Officer and President.
SECTION 12. Parties.
-------
This Underwriting Agreement and the applicable Terms Agreement shall each
inure to the benefit of and be binding upon the parties hereto and, upon
execution of such Terms Agreement, any other Underwriters and their respective
successors. Nothing expressed or mentioned in this Underwriting Agreement or
such Terms Agreement is intended or shall be construed to give any person,
firm or corporation, other than the Underwriters, the Operating Partnership,
the Company and their respective successors and the controlling persons and
officers and directors referred to in Sections 6 and 7 and their heirs and
legal representatives, any legal or equitable right, remedy or claim under or
in respect of this Underwriting Agreement or such Terms Agreement or any
provision herein or therein contained. This Underwriting Agreement and such
Terms Agreement and all conditions and provisions hereof and thereof are
intended to be for the sole and exclusive benefit of the parties hereto and
thereto and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Underwritten
Securities from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
SECTION 13. Governing Law and Time.
----------------------
THIS UNDERWRITING AGREEMENT AND ANY APPLICABLE TERMS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE. SPECIFIED
TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. Effect of Headings.
------------------
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
29
SECTION 15. Counterparts.
------------
This Underwriting Agreement and the applicable Terms Agreements may be
executed in one or more counterparts, and if executed in more than one
counterpart, the executed counterparts shall constitute a single instrument.
[The remainder of the page has been left blank intentionally.]
30
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Operating Partnership and the Company
an executed counterpart of the applicable Terms Agreement, whereupon this
Underwriting Agreement, along with the applicable Terms Agreement, will become
a binding agreement among the Underwriters and the Operating Partnership and
the Company in accordance with their terms.
Very truly yours,
RECKSON OPERATING PARTNERSHIP, L.P.
By: Reckson Associates Realty Corp.
its General Partner
By:/s/ Michael Maturo
------------------------------------
Name: Michael Maturo
Title: Executive Vice President
and Chief Financial Officer
RECKSON ASSOCIATES REALTY CORP.
By: /s/ Michael Maturo
-----------------------------------------
Name: Michael Maturo
Title: Executive Vice President and
Chief Financial Officer
CONFIRMED AND ACCEPTED,
as of the date first
above written:
CITIGROUP GLOBAL MARKETS INC.
By: /s/ Paul Ingrassia
-------------------------------
Name: Paul Ingrassia
Title: Managing Director
Exhibit A
---------
RECKSON OPERATING PARTNERSHIP, L.P.
(a Delaware limited partnership)
and
Debt Securities
Fully and Unconditionally Guaranteed By
RECKSON ASSOCIATES REALTY CORP.
(a Maryland corporation)
TERMS AGREEMENT
__________ __, 200_
To: Reckson Operating Partnership, L.P.
Reckson Associates Realty Corp.
225 Broadhollow Road
Melville, New York 11747
Ladies and Gentlemen:
We understand that Reckson Operating Partnership, L.P. (the "Operating
Partnership") proposes to issue and sell $[_____] in aggregate principal
amount of its debt securities (the "Notes"), which shall be fully and
unconditionally guaranteed as to the payment of principal and interest thereon
(the "Guarantee", and together with the Notes, the "Initial Underwritten
Securities") by Reckson Associates Realty Corp. (the "Company"). The Initial
Underwritten Securities shall be exchangeable in accordance with their terms
and the terms of the Indenture (as defined in the Underwriting Agreement) into
cash and, if applicable, shares of the Company's common stock, par value $0.01
per share (the "Underlying Shares"). Subject to the terms and conditions set
forth or incorporated by reference herein, the underwriters named below (the
"Underwriters") offer to purchase, severally and not jointly, the respective
aggregate principal amount of Initial Underwritten Securities set forth below
opposite their names at the purchase price set forth below, and a
proportionate share of Option Underwritten Securities (as defined in the
Underwriting Agreement referred to below) set forth below, to the extent any
are purchased.
Aggregate Principal Amount of
Initial Underwritten Securities
Total [$]
A-1
The Underwritten Securities shall have the following terms:
Title:
Aggregate Principal Amount: $
Aggregate Principal Amount of Option
Underwritten Securities: $
Initial public offering price: $
Purchase price: $
Interest rate:
Interest Payment Date:
Maturity Date:
Redemption provisions:
Sinking Fund requirements:
Conversion provisions:
Other terms and conditions:
Closing date and location:
All of the provisions contained in the document attached as Annex I
hereto entitled "RECKSON OPERATING PARTNERSHIP, L.P. AND RECKSON ASSOCIATES
REALTY CORP. -- UNDERWRITING AGREEMENT" are hereby incorporated by reference
in their entirety herein and shall be deemed to be a part of this Terms
Agreement to the same extent as if such provisions had been set forth in full
herein. Terms defined in such document are used herein as therein defined.
A-2
Please accept this offer no later than o'clock p.m. (New York City time)
on by signing a copy of this Terms Agreement in the space set forth below and
returning the signed copy to us.
Very truly yours,
[ ]
[address for Notice]
By: ________________________________
Name:
Title:
Acting on behalf of itself and as Representative[s] for the other named
Underwriters.
Accepted:
RECKSON OPERATING PARTNERSHIP, L.P.
By: RECKSON ASSOCIATES REALTY CORP., its sole general partner
By: ___________________________
Name:
Title:
By: RECKSON ASSOCIATES REALTY CORP.
By: ___________________________
Name:
Title:
A-3
Exhibit B
---------
SIGNIFICANT SUBSIDIARIES
Reckson 1185 Avenue of the Americas LLC
Reckson MEZZ 1185 Avenue of the Americas LLC
Reckson Tri-State Member LLC
RT Tri-State LLC
Metropolitan Partners LLC
Metropolitan Operating Partnership, L.P.
Metropolitan 919 3rd Avenue LLC
Metropolitan 919 Manager LLC
919 JV LLC
Reckson Court Square, LLC
B-1
Exhibit C
---------
FORM OF OPINION OF THE COMPANY'S AND THE
OPERATING PARTNERSHIP'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)(i)
(1) The Company has been duly incorporated and is validly existing as a
corporation and is in good standing with the State Department of Assessments
and Taxation of Maryland. The Company has the 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, or as
contemplated under, the Underwriting Agreement, the applicable Terms Agreement
and the Common Stock Delivery Agreement and is duly qualified or registered as
a foreign corporation to transact business and is in good standing in the
jurisdictions indicated on Schedule I hereto.
(2) The Operating Partnership has been duly organized and is validly
existing as a limited partnership and is in good standing with the Secretary
of State of the State of Delaware. The Operating Partnership has the
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, or as contemplated under, the Underwriting
Agreement and the applicable Terms Agreement and the Common Stock Delivery
Agreement and is duly qualified or registered as a foreign partnership to
transact business and is in good standing in the jurisdictions indicated on
Schedule I hereto.
(3) The issued and outstanding shares of capital stock of the Company are
duly authorized; all issued and outstanding shares of capital stock of the
Company are validly issued, fully paid and non-assessable and conform in all
material respects to the description thereof contained in the Prospectus; to
our knowledge, no shares of capital stock of the Company are reserved for any
purpose except in connection with (i) the Company's employee stock option
plans (collectively, the "Reckson Stock Option Plans"), (ii) the Company's
Long-Term Incentive Plan and (iii) the possible issuance of shares of Common
Stock upon the exchange of Units; and, to our knowledge, except for the
Underwritten Securities and for the Units and the options issued under the
Reckson Stock Option Plans, there are no outstanding securities convertible
into or exchangeable for any capital stock of the Company, other than as
described in the Prospectus, no outstanding preemptive or similar rights to
purchase or to subscribe for shares of such stock or any other securities of
the Company arising under Maryland law or under the charter or bylaws of the
Company or any contracts to which the Company is a party of which we are
aware.
(4) All the outstanding Units have been duly authorized for issuance by
the Operating Partnership to the holders of Units and, assuming that the
holders of Units, as limited partners of the Operating Partnership, do not
participate in the control of the business of the Operating Partnership, the
Units will represent valid and, subject to the qualifications set forth
herein, fully paid limited partner interests in the Operating Partnership
(subject to the obligation of a limited
C-1
partner of the Operating Partnership to make payments provided for in the
Operating Partnership Agreement and to repay any funds wrongfully distributed
to it). No Units are reserved for any purpose and except for the "put rights"
accorded to Odyssey Partners, L.P., under Section 12.4 of the Second Amended
and Restated Agreement of Limited Partnership of the Omni Partnership, and the
rights of the holders of the Class C common units, Series D and F preferred
units of limited partner interest in the Operating Partnership or pursuant to
the Company's Long-Term Incentive Plan, and except as otherwise described in
the Prospectus, to our knowledge, there are no outstanding securities
convertible into or exchangeable for any Units and no outstanding preemptive
or other similar rights to purchase or subscribe for Units or any other
securities of the Operating Partnership arising under the Delaware Revised
Uniform Limited Partnership Act or under the Operating Partnership Agreement
or any contracts to which the Operating Partnership is a party of which we are
aware.
(5) Each Significant Subsidiary has been duly organized and is validly
existing as a limited partnership or limited liability company, as the case
may be, in good standing under the laws of the jurisdiction of its
organization, as the case may be, and has the partnership or limited liability
company power and authority to own, lease and operate its properties and to
conduct the business in which it is engaged or proposes to engage as described
in the Prospectus and is duly qualified or registered as a foreign limited
partnership or foreign limited liability company, as the case may be, to
transact business and is in good standing in the jurisdictions indicated on
Schedule I hereto. Except as otherwise stated in the Registration Statement
and the Prospectus, all of the issued and outstanding capital stock or other
equity interests, as the case may be, of each Significant Subsidiary has been
duly authorized and is validly issued, and except with regard to Metropolitan
Operating Partnership, L.P., fully paid and non-assessable.
(6) The Underwriting Agreement, the applicable Terms Agreement and the
Common Stock Delivery Agreement have been duly authorized, executed and
delivered by each of the Operating Partnership and the Company.
(7) The Indenture has been duly authorized, executed and delivered by the
Operating Partnership and constitutes a valid and legally binding agreement,
enforceable in accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity principles;
and the Indenture has been duly qualified under the Trust Indenture Act.
(8) The Debt Securities have been duly authorized by the Operating
Partnership and, when issued and delivered pursuant to the Indenture, the
Underwriting Agreement and the applicable Terms Agreement against payment of
the requisite consideration therefor, such Debt Securities will have been duly
executed and delivered by the Operating Partnership and will constitute valid
and legally binding obligations of the Operating Partnership entitled to the
benefits provided by the Indenture, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability relating to
or affecting creditors' rights generally and to general equity principles.
(9) The Underlying Shares have been duly authorized and reserved for
issuance by the Company upon the exchange of the Underwritten Securities, if
applicable. The Underlying
C-2
Shares, if and when issued upon such exercise, will be validly issued, fully
paid and non-assessable and will not be subject to preemptive or other similar
rights.
(10) The Underwritten Securities being sold pursuant to the applicable
Terms Agreement and the Indenture conform, in all material respects, to the
statements relating thereto contained in the Prospectus and are in
substantially the form filed or incorporated by reference, as the case may be,
as an exhibit to the Registration Statement.
(11) The information in the Prospectus under "Description of Debt
Securities" and "Description of Debentures," and such other information in the
Prospectus Supplement or in any Annual Report on Form 10-K of the Company or
the Operating Partnership as may be agreed upon from time to time by the
Company and the Representative, to the extent that it constitutes matters of
law, descriptions of statutes, rules or regulations, summaries of legal
matters, the Operating Partnership's and the Company's legal proceedings, or
legal conclusions, has been reviewed by us and is correct in all material
respects and fairly summarizes the information required to be disclosed
therein.
(12) (A) To our knowledge, none of the Company, the Operating Partnership
or any of the Significant Subsidiaries is in violation of its charter,
by-laws, partnership agreement, limited liability company operating agreement,
or other organizational document, as the case may be, and (B) to our
knowledge, no default by the Operating Partnership or any Significant
Subsidiary exists in the due performance or observance of any obligation,
agreement, covenant or condition contained in any contract, indenture,
mortgage, loan agreement, note, lease or other agreement or instrument that is
filed or incorporated by reference as an exhibit to the Registration Statement
to which the Operating Partnership, the Company or any Significant Subsidiary
is a party or by which any of them may be bound, except for such defaults that
would not have a Material Adverse Effect, and except that we express no
opinion concerning whether there has been a default under any such contract,
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument with regard to financial covenants or insurance coverage for acts
of terrorism.
(13) The execution, delivery and performance of the Underwriting
Agreement, the applicable Terms Agreement, the Common Stock Delivery Agreement
and the Indenture and consummation of the transactions contemplated in the
Underwriting Agreement and such Terms Agreement and in the Registration
Statement and the Prospectus (including the issuance and sale of the
Underwritten Securities) and compliance by the Operating Partnership, the
Company or any Significant Subsidiary with its obligations thereunder do not
and will not, whether with or without the giving of notice or passage of time
or both, conflict with or constitute a breach of, or default or Repayment
Event under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Operating Partnership, the
Company or any Significant Subsidiary pursuant to, any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, lease or any other
agreement or instrument, filed or incorporated by reference as an exhibit to
the Registration Statement to which the Operating Partnership, the Company or
any Significant Subsidiary is a party or by which it or any of them may be
bound, or to which any of the assets, properties or operations of the
Operating Partnership, the Company or any Significant Subsidiary is subject,
except for such conflicts, breaches, defaults, events or liens, charges or
encumbrances that would not result in a Material Adverse Effect, nor will such
action
C-3
result in any violation of the provisions of the charter, by-laws, agreement
of limited partnership, or limited liability company operating agreement, as
applicable, of the Operating Partnership, the Company or any Significant
Subsidiary or any applicable Delaware Revised Uniform Limited Partnership Act,
Maryland, New York or U.S. federal laws, statute, rule, regulations, or any
judgment, order, writ or decree, known to us, of any Delaware, Maryland, New
York or U.S. federal government, government instrumentality or court, domestic
or foreign, having jurisdiction over the Operating Partnership, the Company or
any Significant Subsidiary or any of their assets, properties or operations.
(14) To our knowledge, except as disclosed in the Prospectus, there are
no pending or threatened actions, suits or proceedings against or affecting
any of the Operating Partnership, the Company or any Subsidiary or any of
their respective properties or other assets that, if determined adversely to
any such entity would individually or in the aggregate have a Material Adverse
Effect or would materially adversely affect the ability of the Operating
Partnership or the Company to perform their respective obligations under the
Underwriting Agreement and the applicable Terms Agreement.
(15) The descriptions in the Registration Statement of the $250,000,000
4.00% Exchangeable Senior Debentures due 2025 to be issued pursuant to the
Indenture, dated as of March 26, 1999 between the Operating Partnership, the
Company and The Bank of New York, as trustee, as well as contracts and other
documents filed as exhibits to the Operating Partnership's Annual Report on
Form 10-K, the Operating Partnership's Quarterly Report on Form 10-Q for the
first quarter of 2005, the Company's Annual Report on Form 10-K and the
Company's Quarterly Report on Form 10-Q for the first quarter of 2005, are
accurate in all material respects. To our knowledge, there are no franchises,
contracts, indentures, mortgages, loan agreements, notes, leases or other
instruments required to be described or referred to in the Registration
Statement or to be filed as exhibits thereto other than those described or
referred to therein or filed or incorporated by reference as exhibits thereto.
(16) The Registration Statement has been declared effective under the
1933 Act. Any required filing of the Prospectus pursuant to Rule 424(b) has
been made in the manner and within the time period required by Rule 424(b). To
our knowledge, no stop order suspending the effectiveness of the Registration
Statement has been issued under the 1933 Act or proceedings therefor initiated
or threatened by the Commission.
(17) The Registration Statement, the Prospectus, excluding the documents
incorporated by reference therein, and each amendment or supplement to the
Registration Statement and the Prospectus, excluding the documents
incorporated by reference therein, as of their respective effective or issue
dates (other than the financial statements (including notes and supporting
schedules thereto) and other financial data included or incorporated by
reference therein or omitted therefrom or the Trustee's Statement of
Eligibility on Form T-1, and for statistical information derived from such
financial statements, schedules, or other financial data, as to which we
express no opinion), complied as to form in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations and the Trust
Indenture Act and 1939 Act Regulations.
C-4
(18) The documents incorporated by reference in the Prospectus (other
than the financial statements (including notes and supporting schedules
thereto) and other financial data included or incorporated by reference
therein or omitted therefrom, and for statistical information derived from
such financial statements, schedules, or other financial data, as to which we
express no opinion), when they were filed with the Commission, (or, if later,
upon the filing of an amendment thereto), complied as to form in all material
respects with the requirements of the 1934 Act and the rules and regulations
of the Commission thereunder.
(19) No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any Delaware, Maryland, New York or
U.S. federal court or governmental authority or agency is necessary or
required for the performance by the Operating Partnership and the Company of
their respective obligations under the Underwriting Agreement or the
applicable Terms Agreement or in connection with the transactions contemplated
under the Underwriting Agreement or such Terms Agreement other than under the
1933 Act, the 1933 Act Regulations, the Trust Indenture Act or the 1939 Act
Regulations, which have been obtained, or as may be required under the by-laws
and rules of the NASD, state securities or blue sky laws or real estate
syndication laws.
(20) Neither the Operating Partnership nor the Company is an "investment
company" within the meaning of the Investment Company Act of 1940, as amended
(the "1940 Act").
No fact has come to our attention that has caused us to believe that the
Registration Statement (other than the financial statements (including notes
and supporting schedules thereto) and other financial data included or
incorporated by reference therein or omitted therefrom and for statistical
information derived from such financial statements, schedules or other
financial data or the Trustee's Statement of Eligibility on Form T-1, as to
which we have not been requested to comment), at the time the Registration
Statement or any post-effective amendment thereto (including the filing of the
Operating Partnership's and the Company's Annual Reports on Form 10-K with the
Commission) became effective or at the date of the applicable Terms Agreement,
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 or that the Prospectus or any amendment or
supplement thereto (other than the financial statements (including notes and
supporting schedules thereto) and other financial data included or
incorporated by reference therein or omitted therefrom and for statistical
information derived from such financial statements, schedules or other
financial data, as to which we have not been requested to comment), at the
time the Prospectus was issued, at the time any such amended or supplemented
prospectus was issued or at the Closing Time, included or includes an untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
In rendering such opinion, such counsel may rely, as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company on behalf of the Company
for itself and as general partner of the Operating Partnership, and public
officials. Such opinion shall not state that it is to be governed or qualified
by, or that it is otherwise subject to, any treatise, written policy or other
document
C-5
relating to legal opinions, including, without limitation, the Legal Opinion
Accord of the ABA Section of Business Law (1991).
C-6
Schedule I
----------
1. Reckson Associates Realty Corp.
o New York
o New Jersey
o Connecticut
2. Reckson Operating Partnership, L.P.
o New York
o New Jersey
o Connecticut
3. Metropolitan Partners LLC
o New York
4. Metropolitan Operating Partnership, L.P.
o New York
5. Metropolitan 919 3rd Avenue LLC
o New York
6. Metropolitan 919 Manager LLC
7. 919 JV LLC
8. Reckson Tri-State Member LLC
9. RT Tri-State LLC
10. Reckson 1185 Avenue of the Americas LLC
o New York
11. Reckson Mezz 1185 Avenue of the Americas LLC
12. Reckson Court Square, LLC
o New York
S-1
Annex I
-------
[FORM OF ACCOUNTANTS' COMFORT LETTER PURSUANT TO SECTION 5(e)]
We are independent public accountants with respect to the Company within the
meaning of the 1933 Act and the applicable published 1933 Act Regulations.
(i) in our opinion, the audited financial statements and the related
financial statement schedules included or incorporated by reference in
the Registration Statement and the Prospectus comply as to form in all
material respects with the applicable accounting requirements of the 1933
Act and the published rules and regulations thereunder;
(ii) on the basis of procedures (but not an examination in
accordance with generally accepted auditing standards) consisting of a
reading of the unaudited interim [consolidated] financial statements of
the Company for the [three month periods ended __________, ____, and
__________, ____, the three and six month periods ended __________, ____,
and __________, ____, and the three and nine month periods ended
__________, ____, and __________, ____, included or incorporated by
reference in the Registration Statement and the Prospectus (collectively,
the "10-Q Financials")](1) [, a reading of the unaudited interim
[consolidated] financial statements of the Company for the _____-month
periods ended __________, ____, and __________, ____, included in the
Registration Statement and the Prospectus (the "_____-month
financials")](2) [, a reading of the latest available unaudited interim
[consolidated] financial statements of the Company],(3) a reading of the
minutes of all meetings of the stockholders and directors of the Company
[and its subsidiaries] and the Committees of the Company's Board of
Directors [and any subsidiary committees] since [day after end of last
audited period], inquiries of certain officials of the Company [and its
subsidiaries] responsible for financial and accounting matters, a review
of interim financial information in accordance with standards established
by the Public Accounting Oversight Board (United States), as described in
AV 722, Interim Financial Information,(4) with respect to the
[description of
- --------------------------
(1) Include the appropriate dates of the 10-Q Financials.
(2) Include if non-10-Q interim financial statements are included in the
Registration Statement and the Prospectus.
(3) Include if the most recent unaudited financial statements are not included
in the Registration Statement and the Prospectus.
(4) Note that a review in accordance with Statements on Auditing Standards
("SAS") No. 100 is required for an accountant to give negative assurance on
interim financial information. A review in accordance with SAS No. 100 will
only be performed at the request of the Company and the accountant's report,
if any, related to that review will be addressed only to the Company. Many
companies have a SAS No. 100 review performed in connection with the
preparation of their 10-Q financial statements. See Codification of Statements
on Auditing Standards, AU ss. 722 for a description of the procedures that
constitute such a review. The comfort letter itself should recite that the
review was performed and a copy of the report, if any, should be attached to
the comfort letter. Any report issued pursuant to SAS No. 100
A-1
relevant periods](5) and such other inquiries and procedures as may be
specified in such letter, nothing came to our attention that caused us to
believe that:
[(A) the 10-Q Financials incorporated by reference in the
Registration Statement and the Prospectus do not comply as to form
in all material respects with the applicable accounting requirements
of the 1934 Act and the 1934 Act Regulations applicable to unaudited
financial statements included in Form 10-Q or any material
modifications should be made to the 10-Q Financials incorporated by
reference in the Registration Statement and the Prospectus for them
to be in conformity with generally accepted accounting
principles;](6)
[(B) the _____-month financials included in the Registration
Statement and the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements of the
1933 Act and the 1933 Act Regulations applicable to unaudited
interim financial statements included in registration statements or
any material modifications should be made to the _____-month
financials included in the Registration Statement and the Prospectus
for them to be in conformity with generally accepted accounting
principles;](7)
(C) at [____________, ____ and at](8) a specified date not more
than five days(9) prior to the date of the applicable Terms
Agreement, there was any change in the __________ of the Company
[and its subsidiaries] or any decrease in the _________ of the
Company [and its subsidiaries] or any increase in the
- --------------------------
that is mentioned in the Registration Statement should also be included in the
Registration Statement as an exhibit. If a review in accordance with SAS No.
100 has not and will not be performed by the accountants, they should be
prepared to perform certain agreed-upon procedures on the interim financial
information and to report their findings thereon in the comfort letter. See
Codification of Statements on Auditing Standards, AU ss. 622 for a discussion
of reports related to the accountant's performance of agreed-upon procedures.
Any question as to whether a review in accordance with SAS No. 100 will be
performed by the accountants should be resolved early.
(5) The relevant periods include all interim unaudited condensed consolidation
financial statements included or incorporated by reference in the Registration
Statement and the Prospectus.
(6) Include if the 10-Q Financials are incorporated by reference in the
Registration Statement and the Prospectus.
(7) Include if unaudited financial statements, not just selected unaudited
data, are included in the Registration Statement and the Prospectus.
(8) Include, and insert the date of most recent balance sheet of the Company,
if those statements are more recent than the unaudited financial statements
included in the Registration Statement and the Prospectus.
(9) According to Example A of SAS No. 72, the specified date should be five
calendar days prior to the date of the applicable Terms Agreement. However, in
unusual circumstances, five business days may be used.
A-2
___________ of the Company [and its subsidiaries,](10) in each case
as compared with amounts shown in the latest balance sheet included
in the Registration Statement and the Prospectus, except in each
case for changes, decreases or increases that the Registration
Statement and the Prospectus disclose have occurred or may occur; or
(D) [for the period from ___________, ____ to ___________, ____
and](11) for the period from _________, ____ to a specified date not
more than five days prior to the date of the applicable Terms
Agreement, there was any decrease in __________, ___________ or
___________,(12) in each case as compared with the comparable period
in the preceding year, except in each case for any decreases that
the Registration Statement and the Prospectus discloses have
occurred or may occur;
(iii) based upon the procedures set forth in clause (ii) above and a
reading of the [Selected Financial Data] included in the Registration
Statement and the Prospectus [and a reading of the financial statements
from which such data were derived,](13) nothing came to our attention
that caused us to believe that the [Selected Financial Data] included in
the Registration Statement and the Prospectus do not comply as to form in
all material respects with the disclosure requirements of Item 301 of
Regulation S-K of the 1933 Act [, that the amounts included in the
[Selected Financial Data] are not in agreement with the corresponding
amounts in the audited [consolidated] financial statements for the
respective periods or that the financial statements not included in the
Registration Statement and the Prospectus from which certain of such data
were derived are not in conformity with generally accepted accounting
principles];(14)
- --------------------------
(10) The blanks should be filled in with significant balance sheet items,
selected by the banker and tailored to the issuer's industry in general and
operations in particular. While the ultimate decision of which items should be
included rests with the banker, comfort is routinely requested for certain
balance sheet items, including long-term debt, stockholders' equity, capital
stock and net current assets.
(11) Include, and insert dates to describe the period from the date of the
most recent financial statements in the Registration Statement and the
Prospectus to the date of the most recent unaudited financial statements of
the Company, if those dates are different. Regardless of whether this language
is inserted or not, the period including five days prior to the date of the
applicable Terms Agreement should run from the date of the last financial
statement included in the Registration Statement and the Prospectus, not from
the later one that is not included in the Registration Statement and the
Prospectus.
(12) The blanks should be filled in with significant income statements items,
selected by the banker and tailored to the issuer's industry in general and
operations in particular. While the ultimate decision of which items should be
included rests with the banker, comfort is routinely requested for certain
income statement items, including net sales, total and per share amounts of
income before extraordinary items and of net income.
(13) Include only if there are selected financial data that have been derived
from financial statements not included in the Registration Statement and the
Prospectus.
(14) In unusual circumstances, the accountants may report on "Selected
Financial Data" as described in SAS No. 42, Reporting on Condensed Financial
Statements and Selected Financial Data, and include
A-3
(iv) we have compared the information in the Registration Statement
and the Prospectus under selected captions with the disclosure
requirements of Regulation S-K of the 1933 Act and on the basis of
limited procedures specified herein. Nothing came to our attention that
caused us to believe that this information does not comply as to form in
all material respects with the disclosure requirements of Items 302, 402
and 503(d), respectively, of Regulation S-K;
[(v) based upon the procedures set forth in clause (ii) above, a
reading of the unaudited financial statements of the Company for [the
most recent period] that have not been included in the Registration
Statement and the Prospectus and a review of such financial statements in
accordance with SAS 100, nothing came to our attention that caused us to
believe that the unaudited amounts for __________________ for the [most
recent period] do not agree with the amounts set forth in the unaudited
consolidated financial statements for those periods or that such
unaudited amounts were not determined on a basis substantially consistent
with that of the corresponding amounts in the audited [consolidated]
financial statements;](15)
[(vi)] we are unable to and do not express any opinion on the [Pro
Forma Combining Statement of Operations] (the "Pro Forma Statement")
included in the Registration Statement and the Prospectus or on the pro
forma adjustments applied to the historical amounts included in the Pro
Forma Statement; however, for purposes of this letter we have:
(A) read the Pro Forma Statement;
(B) performed [an audit] [a review in accordance with SAS
100] of the financial statements to which the pro forma
adjustments were applied;
(C) made inquiries of certain officials of the Company who
have responsibility for financial and accounting matters about
the basis for their determination of the pro forma adjustments
and whether the Pro Forma Statement complies as to form in all
material respects with the applicable accounting requirements
of Rule 11-02 of Regulation S-X; and
- --------------------------
in their report in the Registration Statement and the Prospectus the paragraph
contemplated by SAS No. 42.9. This situation may arise only if the Selected
Financial Data do not include interim period data and the five-year selected
data are derived entirely from financial statements audited by the auditors
whose report is included in the Registration Statement and the Prospectus. If
the guidelines set forth in SAS No. 42 are followed and the accountant's
report as included in the Registration Statement and the Prospectus includes
the additional language prescribed by SAS No. 42.9, the bracketed language may
be eliminated.
(15) This language should be included when the Registration Statement and the
Prospectus include earnings or other data for a period after the date of the
latest financial statements in the Registration Statement and the Prospectus,
but the unaudited interim financial statements from which the earnings or
other data is derived is not included in the Registration Statement and the
Prospectus. The blank should be filled in with a description of the financial
statement item(s) included.
A-4
(D) proved the arithmetic accuracy of the application of
the pro forma adjustments to the historical amounts in the Pro
Forma Statement; and
on the basis of such procedures and such other inquiries and
procedures as specified herein, nothing came to our attention that
caused us to believe that the Pro Forma Statement included in the
Registration Statement does not comply as to form in all material
respects with the applicable requirements of Rule 11-02 of
Regulation S-X or that the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of
those statements;(16) and
[(vii)] in addition to the procedures referred to in clause (ii)
above, we have performed other procedures, not constituting an audit,
with respect to certain amounts, percentages, numerical data and
financial information appearing in the Registration Statement and the
Prospectus, which are specified herein, and have compared certain of such
items with, and have found such items to be in agreement with, the
accounting and financial records of the Company;(17) and
[(viii) in addition, we [comfort on a financial forecast that is
included in the Registration Statement and the Prospectus.(18)]
- --------------------------
(16) If an audit or a review in accordance with SAS No. 100 has not been
performed by the accountants with respect to the underlying historical
financial statements, or if negative assurance on the Company's pro forma
financial statements is not otherwise available, the accountants should be
requested to perform certain other procedures with respect to such pro forma
financial statements. See Example O of SAS No. 72.
(17) This language is intended to encompass all other financial/numerical
information appearing in the Registration Statement and the Prospectus for
which comfort may be given, including (but not limited to) amounts appearing
in the Registration Statement and the Prospectus narrative and other summary
financial data appearing in tabular form (e.g., the capitalization table).
(18) Accountants' services with respect to a financial forecast may be in one
of three forms: an examination of the forecast, a compilation of the forecast
or the application of agreed-upon procedures to the forecast. If the
accountant is to perform an examination of the forecast included in the
Registration Statement and the Prospectus, delivery of the related report
should be treated separately in Section 5(f) as follows (remember to change
subsequent letters accordingly):
(f) At the time that the applicable Terms Agreement is executed by
the Company, you shall have received from _________________ a report, dated
such date, in form and substance satisfactory to you, together with signed or
reproduced copies of such report for each of the other Underwriters, stating
that, in their opinion, the forecasted financial statements for the [relevant
period or periods] included in the Registration Statement and the Prospectus
are presented in conformity with guidelines for presentation of a forecast
established by the PCAOB, and that the underlying assumptions provide a
reasonable basis for management's forecast.
If the accountant is to perform a compilation of the forecasted financial
statements included in the Registration Statement and the Prospectus, delivery
of the related report should be treated separately in Section 5(e) as follows:
A-5
- --------------------------
(f) At the time that the applicable Terms Agreement is executed by
the Company, you shall have received from _________________ a report, dated
such date, in form and substance satisfactory to you, together with signed or
reproduced copies of such report of each of the other Underwriters, stating
that they have compiled the forecasted financial statements for the [relevant
period or periods] included in the Registration Statement and the Prospectus
in accordance with the guidelines established by the PCAOB.
Finally, if the accountant is to perform agreed-upon procedures on a forecast
included in the Registration Statement and the Prospectus, SAS No. 72 requires
that the accountant first prepare a compilation report with respect to the
forecast and attach that report to the comfort letter. The accountant may then
report on specific procedures performed and findings obtained.
A-6
Exhibit 1.2
RECKSON OPERATING PARTNERSHIP, L.P.
(a Delaware limited partnership)
Debt Securities
Fully and Unconditionally Guaranteed By
RECKSON ASSOCIATES REALTY CORP.
(a Maryland corporation)
TERMS AGREEMENT
June 21, 2005
To: Reckson Operating Partnership, L.P.
Reckson Associates Realty Corp.
225 Broadhollow Road
Melville, New York 11747
Ladies and Gentlemen:
We understand that Reckson Operating Partnership, L.P. (the "Operating
Partnership") proposes to issue and sell $250,000,000 in aggregate principal
amount of its 4.00% Exchangeable Senior Debentures due June 15, 2025 (the
"Debentures"), which shall be fully and unconditionally guaranteed (the
"Guarantee") as to the payment of principal and interest thereon by Reckson
Associates Realty Corp. (the "Company"). The Debentures and the Guarantee
shall be collectively referred to herein as the "Securities." The Securities
shall be exchangeable in accordance with their terms and the terms of the
Indenture (as defined in the Underwriting Agreement) into cash and, if
applicable, shares of the Company's common stock, par value $0.01 per share (
the "Underlying Shares"). Subject to the terms and conditions set forth or
incorporated by reference herein, the underwriter named below (the
"Underwriter") offers to purchase the aggregate principal amount of Securities
set forth below opposite its name at the purchase price set forth below.
Aggregate Principal
Underwriter Amount Of Debentures
----------- ---------------------
Citigroup Global Markets Inc. $250,000,000
Total: $250,000,000
The Debentures shall have the following terms:
Title: 4.00% Exchangeable Senior Debentures due 2025
Rank: The Debentures will be senior unsecured
obligations and will rank equally with each
other and with all of the Company's other senior
unsecured indebtedness, except that the
Debentures will be effectively subordinated to
all of our secured debt and to all liabilities
and preferred equity of our subsidiaries.
Ratings: Baa3 by Moody's Investors Service BBB- by
Standard & Poor's
Aggregate Principal Amount: $250,000,000
Aggregate Principal Amount
of Option Debentures: $37,500,000
Purchase Price: 98% of the principal amount, plus accrued
interest, if any, from the date of issuance
(payable in same day funds).
Interest Rate: The interest rate for the Debentures is 4.00%
per annum.
Interest Payment Dates: Interest on the Debentures is payable
semi-annually in arrears on June 15 and December
15 of each year, commencing December 15, 2005.
Maturity Dates: The Debentures will mature on June 15, 2025.
Redemption Provisions: The Debentures are redeemable at any time on or
after June 18, 2010 (or earlier, if necessary to
preserve the status of the Company as a real
estate investment trust) at the option of the
Operating Partnership or the Company, in whole
or in part, at a redemption price equal to the
sum of the principal amount of the Debentures
being redeemed and any unpaid interest accrued
thereon to the redemption date.
Repurchase provisions Holders of the Debentures have the right to
require the Operating Partnership to repurchase
their Debentures in whole or in part on June 15,
2010, June 15, 2015 and June 15, 2020 and in the
event of a change in control prior to June 15,
2010 for cash equal to the sum of the principal
amount of the Debentures being repurchased and
any unpaid interest accrued thereon to the
repurchase date.
Initial Exchange Rate: 24.6124 Underlying Shares per $1,000 principal
amount of Debentures.
Exchange Provisions: The Debentures will be exchangeable in
accordance with their terms and the terms of the
Indenture into cash and, if applicable,
Underlying Shares.
Lock-up Provisions: See attached Form of Lock-Up Agreement.
Sinking Fund requirements: N/A
Other terms and conditions: N/A
Closing date and location: June 27, 2005 at the offices of Sidley Austin
Brown & Wood LLP, 787 Seventh Avenue, New York,
New York 10019.
All of the provisions contained in the document attached as Annex I
hereto entitled "RECKSON OPERATING PARTNERSHIP, L.P. AND RECKSON ASSOCIATES
REALTY CORP.-- UNDERWRITING AGREEMENT" are hereby incorporated by reference in
their entirety herein and shall be deemed to be a part of this Terms Agreement
to the same extent as if such provisions had been set forth in full herein.
Terms defined in such document are used herein as therein defined.
Please accept this offer no later than 7 o'clock p.m. (New York City
time) on June 21, 2005 by signing a copy of this Terms Agreement in the space
set forth below and returning the signed copy to us.
Very truly yours,
CITIGROUP GLOBAL MARKETS INC.
By: /s/ Paul Ingrassia
------------------------------
Name: Paul Ingrassia
Title: Managing Director
Acting on behalf of themselves and as Representatives for the other named
Underwriters.
Accepted:
RECKSON OPERATING PARTNERSHIP, L.P.
By: RECKSON ASSOCIATES REALTY CORP., its sole general partner
By: /s/ Michael Maturo
---------------------------
Name: Michael Maturo
Title: Executive Vice President and
Chief Financial Officer
RECKSON ASSOCIATES REALTY CORP.
By: /s/ Michael Maturo
---------------------------
Name: Michael Maturo
Title: Executive Vice President and
Chief Financial Officer
Form of Lock-Up Agreement
[Letterhead of officer or director of Reckson Associates Realty Corp.]
Reckson Operating Partnership, L.P.
Reckson Associates Realty Corp.
Public Offering of Exchangeable Senior Debentures
June 21, 2005
Citigroup Global Markets Inc.
390 Greenwich Street, 5th Floor
New York, NY 10013
Ladies and Gentlemen:
This letter is being delivered to you in connection with the Terms Agreement
(the "Terms Agreement"), dated June 21, 2005, among Reckson Operating
Partnership, L.P., a Delaware limited partnership (the "Partnership"), Reckson
Associates Realty Corp., a Maryland corporation (the "Company"), and you,
relating to an underwritten public offering of the Partnership's 4.00%
Exchangeable Senior Debentures due June 15, 2025 (the "Debentures"), which
shall be fully and unconditionally guaranteed as to the payment of principal
and interest thereon by the Company (the "Guarantee" and, collectively with
the Debentures, the "Securities"), and shall be exchangeable in accordance
with their terms into cash and, if applicable, shares of the Company's common
stock, par value $0.01 per share (the "Common Stock").
In order to induce you to enter into the Terms Agreement, the undersigned will
not, without the prior written consent of Citigroup Global Markets Inc.,
offer, sell, contract to sell, pledge or otherwise dispose of (or enter into
any transaction which is designed to, or might reasonably be expected to,
result in the disposition (whether by actual disposition or effective economic
disposition due to cash settlement or otherwise) by the undersigned or any
affiliate of the undersigned or any person in privity with the undersigned or
any affiliate of the undersigned), directly or indirectly, including the
filing (or participation in the filing) of a registration statement with the
Securities and Exchange Commission in respect of (except for a registration
statement on Form S-8 with respect to shares of Common Stock issuable under
the Company's 2005 Stock Option Plan and a shelf registration statement on
Form S-3), or establish or increase a put equivalent position or liquidate or
decrease a call equivalent position within the meaning of Section 16 of the
Securities Exchange Act of 1934, as amended, and the rules and regulations of
the Securities and Exchange Commission promulgated thereunder with respect to,
any shares of Common Stock of the Company, any securities substantially
similar to the Securities or shares of Common Stock or any securities
convertible into or exercisable or exchangeable for such shares of Common
Stock or any securities substantially similar to the Securities or shares of
Common Stock, or publicly announce an intention to effect any such
transaction, for a period of thirty days after the date of the Terms
Agreement, other than shares of Common Stock disposed of as bona fide gifts
approved by Citigroup Global Markets Inc.
If for any reason the Terms Agreement shall be terminated prior to the Closing
Date (as defined in the Terms Agreement), the agreement set forth above shall
likewise be terminated.
Sincerely,
EXHIBIT 4.1
[FACE OF DEBENTURE]
REGISTERED REGISTERED
NO. 001 PRINCIPAL AMOUNT
CUSIP NO. 75621L AJ 3 $250,000,000
UNLESS THIS DEBENTURE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT AND ANY DEBENTURE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC AND ANY PAYMENT IS MADE TO
CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC, ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
UNLESS AND UNTIL THIS DEBENTURE IS EXCHANGED IN WHOLE OR IN PART FOR
DEBENTURES IN CERTIFICATED FORM, THIS DEBENTURE MAY NOT BE TRANSFERRED EXCEPT
AS A WHOLE BY DTC TO A NOMINEE THEREOF OR BY A NOMINEE THEREOF TO DTC OR
ANOTHER NOMINEE OF DTC OR BY DTC OR ANY SUCH NOMINEE TO A SUCCESSOR OF DTC OR
A NOMINEE OF SUCH SUCCESSOR.
RECKSON OPERATING PARTNERSHIP, L.P.
4.00% Exchangeable Senior Debenture due 2025
Reckson Operating Partnership, L.P., a limited partnership duly
organized and existing under the laws of the State of Delaware (herein
referred to as the "Issuer," which term shall include any successor Person
appointed pursuant to the terms of the Indenture referred to on the reverse
hereof), for value received, hereby promises to pay to Cede & Co., or its
registered assigns, the principal sum of $250,000,000 on June 15, 2025 unless
redeemed, repurchased or exchanged prior to such date in accordance with the
terms hereof and of the Indenture.
This Debenture shall bear interest as specified on the reverse
hereof. This Debenture is exchangeable for the consideration specified on the
reverse hereof. This Debenture is subject to redemption by the Issuer at its
option and to repurchase by the Issuer at the option of the Holder as
specified on the reverse hereof.
Reference is hereby made to the further provisions of this Debenture
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
This Debenture shall not be entitled to the benefits of the Indenture
or the Guarantee of Reckson Associates (as defined on the reverse hereof) or
be valid or become obligatory for any purpose until the certificate of
authentication hereon shall have been signed by the Trustee.
IN WITNESS WHEREOF, each of the Issuer and Reckson Associates has
caused this Debenture to be signed manually or by facsimile by an authorized
signatory.
Dated: June 27, 2005
RECKSON OPERATING PARTNERSHIP, L.P.,
as Issuer
By: RECKSON ASSOCIATES REALTY CORP.,
as General Partner
(SEAL) By: /s/ Michael Maturo
----------------------------------------
Name: Michael Maturo
Title: Executive Vice President and
Chief Financial Officer
Attest:
/s/ Jason M. Barnett
- -----------------------------------
Name: Jason M. Barnett
Title: Executive Vice President and
General Counsel
RECKSON ASSOCIATES REALTY CORP.,
as Guarantor
(SEAL) By: /s/ Michael Maturo
----------------------------------------
Name: Michael Maturo
Title: Executive Vice President and
Chief Financial Officer
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
THE BANK OF NEW YORK, N.A.
as Trustee
By: /s/ Julie Salovitch-Miller
------------------------------
Authorized Signatory
[REVERSE OF DEBENTURE]
RECKSON OPERATING PARTNERSHIP, L.P.
4.00% Exchangeable Senior Debenture due 2025
This Debenture is one of a duly authorized issue of debentures,
notes, bonds, or other evidences of indebtedness of the Issuer (hereinafter
called the "Securities") of the series hereinafter specified, all issued or to
be issued under and pursuant to an Indenture, dated as of March 26, 1999
(together with the Officers' Certificate delivered thereunder establishing the
terms of the Debentures (the "Officers' Certificate"), the "Indenture"), duly
executed and delivered by the Issuer and Reckson Associates Realty Corp., a
Maryland corporation ("Reckson Associates"), as guarantor, if applicable, to
The Bank of New York, as trustee (the "Trustee," which term includes any
successor trustee under the Indenture with respect to the series of Securities
of which this Debentures is a part), and reference is hereby made to the
Indenture, and all modifications and amendments and indentures supplemental
thereto relating to the Debentures, for a description of the rights,
limitations of rights, obligations, duties, and immunities thereunder of the
Trustee, the Issuer, Reckson Associates and the Holders of the Debentures and
the terms upon which the Debentures are authenticated and delivered. The
Securities may be issued in one or more series, which different series may be
issued in various aggregate principal amounts, may mature at different times,
may accrue interest (if any) at different rates or formulas and may otherwise
vary as provided in the Indenture. This Debentures is one of a series of
Securities designated as the "4.00% Exchangeable Senior Debentures due 2025"
of the Issuer, initially limited (except as permitted under the Indenture) in
aggregate principal amount to $287,500,000. Terms used herein without
definition and which are defined in the Indenture have the meanings assigned
to them in the Indenture.
1. INTEREST
--------
The Debentures shall bear interest at the rate of 4.00% per annum
from June 27, 2005 or from the most recent Interest Payment Date (as defined
below) to which interest has been paid or duly provided for, as the case may
be, payable semi-annually in arrears on June 15 and December 15 of each year
(each, an "Interest Payment Date"), commencing on December 15, 2005, until the
principal hereof is paid or duly made available for payment. Interest payable
on each Interest Payment Date shall equal the amount of interest accrued for
the period commencing on and including the immediately preceding Interest
Payment Date in respect of which interest has been paid or duly provided for
(or commencing on and including June 27, 2005, if no interest has been paid or
duly provided for) and ending on and including the day preceding such Interest
Payment Date. Interest on the Debentures will be computed on the basis of a
360-day year consisting of twelve 30-day months
2. METHOD OF PAYMENT
-----------------
Except as provided in the Indenture, the Issuer shall pay interest on
the Debentures to the Persons who are Holders of record of Debentures at the
close of business (whether or not a Business Day in The City of New York) on
the June 1 or December 1 immediately preceding the applicable Interest Payment
Date (each, a "Regular Record Date"). Holders must surrender
3
Debentures to a Paying Agent and comply with the other terms of the Indenture
to collect the principal amount, Optional Redemption Price, Optional
Repurchase Price or Change in Control Purchase Price of the Debentures, plus,
if applicable, accrued and unpaid interest, if any, payable as herein provided
at maturity, upon redemption at the Issuer's option or repurchase at the
Holder's option. The Issuer shall pay, in money of the United States that at
the time of payment is legal tender for payment of public and private debts,
all amounts due in cash with respect to the Debentures on the dates and in the
manner provided in this Debenture and the Indenture.
3. PAYING AGENT, EXCHANGE AGENT AND SECURITY REGISTRAR
---------------------------------------------------
Initially, the Trustee shall act as Paying Agent, Exchange Agent and
Security Registrar. The Issuer hereby initially designates the Corporate Trust
Office of the Trustee in New York, New York as the office to be maintained by
it where this Debenture may be presented for payment, registration of transfer
or exchange, where notices or demands to or upon the Issuer or Reckson
Associates in respect of this Debenture or the Indenture may be served and
where the Debentures may be surrendered for exchange in accordance with the
provisions of paragraph 6 hereof and the Indenture. The Issuer may appoint and
change any Paying Agent, Exchange Agent, Security Registrar or co-registrar or
approve a change in the office through which any Paying Agent acts without
notice, other than notice to the Trustee.
4. REDEMPTION BY THE ISSUER
------------------------
The Issuer shall not have the right to redeem any Debentures prior to
June 18, 2010, except to preserve the status of Reckon Associates as a real
estate investment trust. If the Issuer determines it is necessary to redeem
the Debentures in order to preserve the status of Reckson Associates as a real
estate investment trust, the Issuer may redeem all of the Debentures then
Outstanding, in whole or in part, at 100% of the principal amount of the
Debentures to be redeemed plus unpaid interest, if any, accrued thereon to the
Redemption Date.
The Issuer shall have the right to redeem the Debentures for cash, in
whole or in part at any time or from time to time, on or after June 18, 2010
at 100% of the principal amount of the Debentures to be redeemed plus unpaid
interest, if any, accrued thereon to the Redemption Date (the "Redemption
Price").
Notice of redemption at the option of the Issuer shall be mailed at
least 30 days but not more than 60 days before the Redemption Date to each
Holder of Debentures to be redeemed at the Holder's registered address.
Debentures in denominations larger than $1,000 principal amount may be
redeemed in part but only in integral multiples of $1,000 principal amount.
5. OPTIONAL REPURCHASE RIGHTS;
REPURCHASE AT OPTION OF HOLDER UPON A CHANGE IN CONTROL
-------------------------------------------------------
(a) Subject to the terms and conditions of the Indenture, a Holder
shall have the right to require the Issuer to repurchase all of its
Debentures, or any portion of the principal amount thereof that is equal to
$1,000 or an integral multiple thereof, on each of June 15, 2010, June 15,
2015 and June 15, 2020 (each, an "Optional Repurchase Date") for cash equal to
100% of the principal amount of the Debentures to be repurchased plus unpaid
interest, if any, accrued to such Optional Repurchase Date (the "Optional
Repurchase Price"), upon delivery
4
to the Paying Agent of an Optional Repurchase Notice containing the
information set forth in the Indenture, from the opening of business on the
date that is 30 days prior to such Optional Repurchase Date until the close of
business on the fifth Business Day prior to such Optional Repurchase Date and
upon compliance with the other terms of the Indenture.
(b) If a Change in Control occurs at any time prior to June 15, 2010,
a Holder shall have the right, at such Holder's option and subject to the
terms and conditions of the Indenture, to require the Issuer to repurchase all
or any of such Holder's Debentures having a principal amount equal to $1,000
or an integral multiple thereof on the date (the "Change in Control Purchase
Date") specified by the Issuer in the Company Notice (which date shall be no
earlier than 15 days and no later than 30 days after the date of such Company
Notice) for cash equal to the 100% of the principal amount of the Debentures
to be repurchased plus unpaid interest, if any, accrued thereon to the Change
in Control Purchase Date (the "Change in Control Purchase Price").
(c) Holders have the right to withdraw any Optional Repurchase Notice
or Change in Control Purchase Notice, as the case may be, by delivery to the
Paying Agent of a written notice of withdrawal in accordance with the
provisions of the Indenture.
(d) If the Paying Agent holds, in accordance with the terms of the
Indenture, money sufficient to pay the Optional Repurchase Price or Change in
Control Purchase Price of such Debentures on the Optional Repurchase Date or
Change in Control Purchase Date, as the case may be, then, on and after such
date, such Debentures shall cease to be Outstanding and interest on such
Debentures shall cease to accrue, and all other rights of the Holder shall
terminate (other than the right to receive the Optional Repurchase Price or
Change in Control Purchase Price upon delivery or transfer of the Debentures).
6. EXCHANGE
--------
The Debentures shall be exchangeable into the consideration specified
in the Indenture at such times, upon compliance with such conditions and upon
the terms set forth in the Indenture.
The initial Exchange Rate shall be 24.6124 Company Common Shares per
$1,000 principal amount of Debentures, subject to adjustment in the event of
certain circumstances as specified in the Indenture. Debentures tendered for
exchange by a Holder at the close of business on any Regular Record Date for
an interest payment and on or prior to the corresponding Interest Payment Date
must be accompanied by payment of an amount equal to the interest that such
Holder is to receive on such Debentures on such Interest Payment Date;
provided, however, that no such payment shall be required (1) if such
Debentures have been called for redemption on a Redemption Date that is after
such Regular Record Date and on or prior to such Interest Payment Date or (2)
with respect to overdue interest, if any overdue interest exists at the time
of exchange with respect to such Debentures.
The Exchange Rate applicable to each Debenture a notice of exchange
in respect of which is received by the Exchange Agent from and including the
date that is 15 Business Days prior to the anticipated Effective Date of a
transaction described in clause (1) of the definition of Change in Control up
to and including the fifth Business Day following the Effective Date of such
Change in Control shall be increased by the number of Additional Shares
specified in the
5
Indenture; provided, however, that such increase to the Exchange Rate shall
not apply if such Change in Control constitutes a Public Acquirer Change in
Control with respect to which the Company shall have duly made, and given full
effect to, an election, pursuant to and in accordance with the provisions of
Section 14.10 of the Officers' Certificate.
To exchange this Debenture, the Holder must (a) complete and manually
sign the irrevocable exchange notice set for the below (or complete and
manually sign a facsimile of such notice) and deliver such notice to the
Exchange Agent at the office maintained by the Exchange Agent for such
purpose, (b) if this Debenture is in certificated form, surrender such
Debenture to the Exchange Agent, (c) furnish appropriate endorsements and
transfer documents if required by the Exchange Agent, Reckson Associates or
the Trustee and (d) pay any transfer or similar tax, if required. The date on
which the Holder satisfies all such requirements shall be deemed to be the
date on which this Debenture shall have been tendered for exchange.
If the Holder has delivered an Optional Repurchase Notice or a Change
in Control Purchase Notice requiring the Issuer to repurchase all or a portion
of this Debenture pursuant to paragraph 5 hereof, then this Debenture (or
portion hereof subject to such Optional Repurchase Notice or Change in Control
Purchase Notice) may be exchanged only if the Optional Repurchase Notice or
Change in Control Purchase Notice is withdrawn in accordance with the terms of
the Indenture.
7. RANKING
-------
The Debentures are senior unsecured obligations of the Issuer and
shall rank pari passu in right of payment with all other senior unsecured
senior indebtedness of the Issuer from time to time outstanding.
8. GUARANTEE
---------
This Debenture is a Guaranteed Security within the meaning of, and
subject to the provisions applicable to Reckson Associates as Guarantor
thereof contained in, the Indenture.
9. DEFAULTED INTEREST
------------------
Except as otherwise specified herein or in the Indenture, any
Defaulted Interest on this Debenture shall forthwith cease to be payable to
the Holder hereof on the relevant Regular Record Date by virtue of having been
such Holder, and such Defaulted Interest may be paid by the Issuer as provided
for in Section 307 of the Indenture.
10. DENOMINATIONS; TRANSFER; EXCHANGE
---------------------------------
This Debenture is issuable only in fully registered form, without
coupons, in denominations of $1,000 and integral multiples thereof. This
Debenture may be exchanged for a like aggregate principal amount of Debentures
of other authorized denominations at the office or agency of the Issuer in The
City of New York, in the manner and subject to the limitations provided herein
and in the Indenture, but without the payment of any charge except for any tax
or other governmental charge imposed in connection therewith. Upon due
presentment for registration of transfer of this Debenture at the office or
agency of the Issuer in The City of New
6
York, one or more new Debentures of authorized denominations in an equal
aggregate principal amount will be issued to the transferee in exchange
therefor, subject to the limitations provided herein and in the Indenture, but
without payment of any charge except for any tax or other governmental charge
imposed in connection therewith. In the event of any redemption in part, the
Issuer shall not be required to: (i) issue or register the transfer or
exchange of any Debenture during a period beginning at the opening of business
15 days before any selection of Debentures for redemption and ending at the
close of business on the earliest date on which the relevant notice of
redemption is deemed to have been given to all Holders of Debentures to be so
redeemed, or (ii) register the transfer or exchange of any Debenture so
selected for redemption, in whole or in part, except the unredeemed portion of
any Debenture being redeemed in part.
11. PERSONS DEEMED OWNERS
---------------------
The Holder of this Debenture may be treated as the owner of this
Debenture for all purposes, and none of the Issuer, Reckson Associates or the
Trustee nor any authorized agent of the Issuer, Reckson Associates or the
Trustee shall be affected by any notice to the contrary, except as required by
law.
12. MODIFICATION AND AMENDMENT; WAIVER
----------------------------------
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Issuer and, if applicable, the Guarantor, and the rights of the Holders of
the Securities under the Indenture at any time by the Issuer and, if
applicable, the Guarantor, and the Trustee with the consent of the Holders of
a majority in the aggregate principal amount of Securities of any series
issued under the Indenture at the time Outstanding and affected thereby. The
Indenture, as supplemented by Section 4.19 of the Officers' Certificate, also
provides that certain amendments or modifactions may not be made without the
consent of each Holder to be affected thereby. Furthermore, provisions in the
Indenture permit the Holders of a majority in the aggregate principal amount
of the Outstanding Securities of any series, in certain instances, to waive,
on behalf of all of the Holders of Securities of such series, certain past
defaults under the Indenture and their consequences. Any such waiver by the
Holder of this Debenture shall be conclusive and binding upon such Holder and
upon all future Holders of this Debenture and other Debentures issued upon the
registration of transfer hereof or in exchange hereof, or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Debenture.
13. DEFAULTS AND REMEDIES
---------------------
If an Event of Default occurs and is continuing, the Trustee, or the
Holders of not less than 25% in aggregate principal amount of the Debentures
at the time Outstanding, may declare the principal amount and any accrued and
unpaid interest, of all the Debentures to be due and payable in the manner and
with the effect provided in the Indenture. Certain events of bankruptcy or
insolvency are Events of Default which shall result in the Debentures being
declared due and payable immediately upon the occurrence of such Events of
Default.
7
Events of Default in respect of the Debentures are set forth in
Section 501 of the Indenture, as modified by Section 4.18 of the Officers'
Certificate. Holders may not enforce the Indenture or the Debentures except as
provided in the Indenture.
14. CONSOLIDATION, MERGER, AND SALE OF ASSETS
-----------------------------------------
In the event of a consolidation or merger of the Issuer or Reckson
Associates or a conveyance, transfer or lease of all or substantially all of
the property or assets of the Issuer or Reckson Associates as described in
Article VIII of the Indenture, as modified by Section 4.16 of the Officers'
Certificate, the successor entity to the Issuer or Reckson Associates, as the
case may be, shall succeed to and be substituted for the Issuer or Reckson
Associates, as the case may be, and may exercise the rights and powers of the
Issuer or Reckson Associates, as the case may be, under the Indenture, and
thereafter, except in the case of a lease, the Issuer or Reckson Associates,
as the case may be, shall be relieved of all obligations and covenants under
the Indenture and the Debentures.
15. CERTAIN COVENANTS NOT TO APPLY.
-------------------------------
The Debentures shall not be entitled to the benefits of the covenants
set forth in Section 1005 and Section 1006 of the Indenture.
16. TRUSTEE AND AGENT DEALINGS WITH THE COMPANY
-------------------------------------------
The Trustee, Paying Agent, Exchange Agent and Securities Registrar
under the Indenture, each in its individual or any other capacity, may become
the owner or pledgee of Debentures and may otherwise deal with and collect
obligations owed to it by the Issuer, Reckson Associates or their respective
Affiliates and may otherwise deal with the Issuer or its Affiliates with the
same rights it would have if it were not Trustee, Paying Agent, Exchange Agent
or Registrar.
17. CALCULATIONS IN RESPECT OF THE DEBENTURES
-----------------------------------------
Except as otherwise specifically stated herein or in the Indenture,
all calculations to be made in respect of the Debentures shall be the
obligation of the Issuer. All calculations made by the Issuer or its agent as
contemplated pursuant to the terms hereof and of the Indenture shall be final
and binding on the Issuer and the Holders absent manifest error. The Issuer
shall provide a schedule of calculations to the Trustee, and the Trustee shall
be entitled to rely upon the accuracy of the calculations by the Issuer
without independent verification. The Trustee shall forward calculations made
my the Issuer to any Holder of Debentures upon request.
18. GOVERNING LAW
-------------
The Indenture, this Debenture and the Guarantee shall be deemed to be
a contract under the laws of the State of New York, and for all purposes shall
be governed by and construed in accordance with the laws of such State,
without giving effect to any conflict of law principles.
8
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto_________________________________________________________________________.
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
_____________________________________________
| |
| |
|_____________________________________________|
_______________________________________________________________________________
(Please print or Typewrite Name and Address
Including Postal Zip Code of Assignee)
_______________________________________________________________________________
the within Debenture and all rights thereunder, and hereby irrevocably
constitutes and appoints
_______________________________________________________________________________
to transfer said Debenture on the books of the Issuer, with full power of
substitution in the premises.
Dated:__________________________
Signature Guaranteed
- ---------------------------------- ----------------------------------
NOTICE: Signature must be NOTICE: The signature to this
guaranteed by an eligible Guarantor Assignment must correspond with the
Institution (banks, stockbrokers, name as written upon the face of
savings and loan associations and the within Debenture in every
credit unions) with membership in particular, without alteration or
an approved signature guarantee enlargement or any change whatever.
medallion program pursuant to
Securities and Exchange Commission
Rule 17Ad-15.
9
EXCHANGE NOTICE
To exchange this Debenture as provided in the Indenture, check the
box: / /
To exchange only part of this Debenture, state the principal amount
to be exchanged (must be $1,000 or an integral multiple of $1,000):
$____________.
If, in the event the Issuer delivers Net Shares and you want the
stock certificate made out in another person's name, fill in the form below:
_______________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Print or type assignee's name, address and zip code)
Your Signature:
Date: ______________________________ ______________________________
(Sign exactly as your name appears
on the other side of this Debenture)
(1) Signature guaranteed by:
By: ______________________________
____________________________
(1) The signature must be guaranteed by an institution which is a member of
one of the following recognized signature guaranty programs: (i) the
Securities Transfer Agent Medallion Program (STAMP); (ii) the New York Stock
Exchange Medallion Program (MSP); (iii) the Stock Exchange Medallion Program
(SEMP); or (iv) such other guaranty program acceptable to the Trustee.
10
EXHIBIT 4.3
RECKSON OPERATING PARTNERSHIP, L.P.
OFFICERS' CERTIFICATE
Pursuant to Sections 301 and 303 of the Indenture among Reckson
Operating Partnership, L.P., as issuer of Securities (the "Operating
Partnership"), Reckson Associates Realty Corp. (the "Company"), as guarantor
of certain Securities, and The Bank of New York, as trustee, dated as of March
26, 1999 (together with this Officers' Certificate, the "Indenture"), I, Jason
M. Barnett, Executive Vice President, General Counsel and Secretary of the
Company, the general partner of the Operating Partnership, and I, Michael
Maturo, Executive Vice President, Chief Financial Officer and Treasurer of the
Company, do hereby certify as follows:
Article I. Authorization. The establishment of a series of Securities
of the Company has been approved and authorized pursuant to authority granted
by resolutions duly adopted by the Board of Directors of the Company (the
"Board Resolutions").
Article II. Compliance with Conditions Precedent. All covenants and
conditions precedent provided for in the Indenture relating to the
establishment of a series of Securities have been complied with.
Article III. Definitions. Capitalized terms used herein and not
defined herein have the meanings ascribed to such terms in the Indenture or,
if not defined therein, in the form of Debenture attached hereto as Exhibit A:
"Acquirer Common Stock" mean the class of common stock (or depositary
receipts or other certificates representing common equity interests) of the
acquirer or other entity referred to in the definition of "Public Acquirer
Change in Control" that is traded on a national securities exchange or quoted
on NASDAQ or another established over-the-counter trading market in the United
States or which will be so traded or quoted when issued or exchanged in
connection with a Public Acquirer Change in Control.
"Additional Debentures" has the meaning provided in Section 4.02
hereof.
"Applicable Exchange Period" means, with respect to an exchange of
Debentures, the 10 consecutive Trading Day period commencing on the third
Trading Day following the date the Debentures are tendered for exchange.
"Average Price" means, with respect to an exchange of Debentures, an
amount equal to the average of the Closing Sale Prices of Company Common
Shares for each Trading Day in the Applicable Exchange Period.
"Change in Control" means the occurrence at any time any of any of
the following events: (1) consummation of any transaction or event (whether by
means of a share exchange or tender offer applicable to Company Common Shares,
a liquidation, consolidation, recapitalization, reclassification, combination
or merger of the Company or a sale, lease or other transfer of all or
substantially all of the consolidated assets of the Company) or a series of
related
1
transactions or events pursuant to which all of the outstanding Company Common
Shares are exchanged for, converted into or constitute solely the right to
receive, cash, securities or other property more than 10% of which consists of
cash, securities or other property that are not, or upon issuance will not be,
traded on a U.S. national securities exchange or quoted on the NASDAQ; (2) any
"person" or "group" (as such terms are used for purposes of Sections 13(d) and
14(d) of the Exchange Act, whether or not applicable), other than the Company,
the Operating Partnership or any majority owned subsidiary of the Company or
the Operating Partnership or any employee benefit plan of the Company, the
Operating Partnership or such subsidiary, is or becomes the "beneficial owner"
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
more than 50% of the total voting power in the aggregate of all classes of
capital stock of the Company then outstanding entitled to vote generally in
elections of directors; (3) during any period of 12 consecutive months after
the date of original issuance of the Debentures (for so long as the Company is
the general partner of the Operating Partnership immediately prior to such
transaction or series of related transactions), persons who at the beginning
of such 12-month period constituted the Board of Directors of the Company
(together with any new persons whose election was approved by a vote of a
majority of the persons then still comprising the Board of Directors of the
Company who were either members of the Board of Directors of the Company at
the beginning of such period or whose election, designation or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Company; or (4) the Company ceases
to be the general partner of the Operating Partnership or ceases to control
the Operating Partnership; provided, however, that the pro rata distribution
by the Company to its shareholders of shares of its capital stock or shares of
any of the Company's other direct or indirect subsidiaries, will not, in and
of itself, constitute a Change in Control for purposes of this definition.
Notwithstanding the foregoing, even if any of the events specified in the
preceding clauses (1) through (4) have occurred, except as specified in clause
(x), a Change in Control will not be deemed to have occurred if either: (x)
the Closing Sale Price per Company Common Share for any five Trading Days
within the period of 10 consecutive Trading Days ending immediately after the
later of the Change in Control or the public announcement of the Change in
Control, in the case of a Change in Control relating to an acquisition of
capital stock, or the period of 10 consecutive Trading Days ending immediately
after the Change in Control, in the case of a Change in Control relating to a
merger, consolidation or asset sale, equals or exceeds 105% of the Exchange
Price of the Debentures in effect on each of those Trading Days; provided,
however, that the exception to the definition of "Change in Control" specified
in this clause (x) shall not apply in the context of a Change in Control or
Public Acquirer Change in Control for purposes of Section 4.10; or (y) at
least 90% of the consideration (excluding cash payments for fractional shares
and cash payments made pursuant to dissenters' appraisal rights) in a merger,
consolidation or other transaction otherwise constituting a Change in Control
consists of shares of common stock (or depositary receipts or other
certificates representing common equity interests) traded on a U.S. national
securities exchange or quoted on NASDAQ or another established automated
over-the-counter trading market in the United States (or will be so traded or
quoted immediately following such merger, consolidation or other transaction)
and as a result of the merger, consolidation or other transaction the
Debentures become exchangeable into such shares of common stock (or depositary
receipts or other certificates representing common equity interests). For the
purposes of this definition, "person" includes any syndicate or group that
would be deemed to be a "person" under Section 13(d)(3) of the Exchange Act.
2
"Change in Control Purchase Date" has the meaning provided in Section
4.09 hereof.
"Change in Control Purchase Notice" has the meaning provided in
Section 4.09 hereof.
"Change in Control Purchase Price" has the meaning provided in
Section 4.09 hereof.
"Closing Sale Price" of the Company Common Shares or other capital
stock or similar equity interests or other publicly traded securities on any
date means the closing sale price per share (or, if no closing sale price is
reported, the average of the closing bid and ask prices or, if more than one
in either case, the average of the average closing bid and the average closing
ask prices) on such date as reported on the principal U.S. securities exchange
on which the Company Common Shares or such other capital stock or similar
equity interests or other securities are traded or, if the Company Common
Shares or such other capital stock or similar equity interests or other
securities are not listed on a U.S. national or regional securities exchange,
as reported by NASDAQ or by the National Quotation Bureau Incorporated or
another established over-the-counter trading market in the United States. The
Closing Sale Price shall be determined without regard to after-hours trading
or extended market making. In the absence of the foregoing, the Operating
Partnership shall determine the Closing Sale Price on such basis as it
considers appropriate.
"Company" has the meaning provided in the first paragraph of this
instrument until a successor Person shall have become such pursuant to the
applicable provisions of the Indenture, and thereafter, "Company" shall mean
such successor Person.
"Company Common Shares" means shares of common stock, par value $.01
per share, of the Company.
"Company Notice" has the meaning provided in Section 4.09 hereof.
"Daily Share Amount" has the meaning provided in Section 4.12 hereof.
"Debentures" has the meaning provided in Section 4.01 hereof which
shall be substantially in the form attached hereto as "Exhibit A."
"Depositary" has the meaning provided in Section 4.03 hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Agent" means the office or agency designated by the
Operating Partnership where the Debentures may be presented for exchange.
"Exchange Price" means, as of any date of determination, for $1,000
principal amount of Debentures, rounded to the nearest $0.01, with $0.005
rounded upward, the quotient of $1,000 divided by the Exchange Rate in effect
as of such date, rounded to the nearest $0.01, with $0.005 rounded upward.
"Exchange Rate" means the number of Company Common Shares by
reference to which the Exchange Value shall be determined, which shall be
initially 24.6124 Company Common
3
Shares for each $1,000 principal amount of Debentures and as the same shall be
adjusted from time to time in accordance with the provisions hereof and of the
Debentures.
"Exchange Value" means, for each $1,000 principal amount of
Debentures, the product of (a) the applicable Exchange Rate, multiplied by (b)
the Average Price.
"Guarantee" means the full and unconditional guarantee provided by
the Company in respect of the Debentures as made applicable to the Debentures
in accordance with the provisions of Section 4.20 hereof.
"Indenture" has the meaning provided in the first paragraph of this
Officers' Certificate.
"Interest Payment Date" has the meaning provided in Section 4.05
hereof.
"NASDAQ" means the National Association of Securities Dealers
Automated Quotation System.
"Net Amount" has the meaning provided in Section 4.12 hereof.
"Net Cash Amount" has the meaning provided in Section 4.12 hereof.
"Net Shares" has the meaning provided in Section 4.12 hereof.
"Operating Partnership" has the meaning specified in the first
paragraph of this Officers' Certificate until a successor Person shall have
become such pursuant to the applicable provisions of the Indenture, and
thereafter "Operating Partnership" shall mean such successor Person.
"Optional Repurchase Date" has the meaning provided in Section 4.08
hereof.
"Optional Repurchase Notice" has the meaning provided in Section 4.08
hereof.
"Optional Repurchase Price" has the meaning provided in Section 4.08
hereof.
"Principal Return" has the meaning provided in Section 4.12 hereof.
"Public Acquirer Change in Control" means any transaction described
in clause (1) of the definition of Change in Control where the acquirer, or
any entity that it is a direct or indirect "beneficial owner" (as defined in
Rule 13d-3 under the Exchange Act) of more than 50% of the total voting power
of all shares of such acquirer's capital stock that are entitled to vote
generally in the election of directors, has a class of common stock (or
depositary receipts or other certificates representing common equity
interests) traded on a U.S. national securities exchange or quoted on NASDAQ
or another established over-the-counter trading market in the United States or
which will be so traded or quoted when issued or exchanged in connection with
such Change in Control; provided, however, that if there is more than one such
entity, the relevant entity will be such entity with the most direct
beneficial ownership to the capital stock of such acquirer or entity.
4
"Redemption Date" means, with respect to any Debenture or portion
thereof to be redeemed in accordance with the provisions of Section 4.07
hereof, the date fixed for such redemption in accordance with the provisions
of Section 4.07 hereof.
"Redemption Price" has the meaning provided in Section 4.07 hereof.
"Regular Record Date" has the meaning provided in Section 4.05
hereof.
"Trading Day" means a day during which trading in securities
generally occurs on the New York Stock Exchange or, if Company Common Shares
are not then listed on the New York Stock Exchange, on the principal other
U.S. national or regional securities exchange on which Company Common Shares
are then listed or, if Company Common Shares are not then listed on a U.S.
national or regional securities exchange, on NASDAQ or, if Company Common
Shares are not then quoted on NASDAQ, on the principal other market on which
Company Common Shares are then traded.
"Trading Price" means, with respect to the Debentures on any date of
determination, the average of the secondary market bid quotations per $1,000
principal amount of Debentures obtained by the Trustee for a $5,000,000
principal amount of Debentures at approximately 3:30 p.m., New York City time,
on such determination date from two independent nationally recognized
securities dealers selected by the Operating Partnership, which may include
Citigroup Global Markets Inc. or its successor. If at least two such bids
cannot reasonably be obtained by the Trustee, but one such bid can reasonably
be obtained by the Trustee, then one bid shall be used. If the Trustee cannot
reasonably obtain at least one bid for a $5,000,000 principal amount of
Debentures from a nationally recognized securities dealer or, in the
reasonable judgment of the Operating Partnership, the bid quotations are not
indicative of the secondary market value of the Debentures, then the Trading
Price per $1,000 principal amount of Debentures shall be deemed to be less
than 98% of the product of the Closing Sale Price of Company Common Shares and
the Exchange Rate on such determination date.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
"Underwriting Agreement" means the Underwriting Agreement, dated June
21, 2005, among the Company, the Operating Partnership and Citigroup Global
Markets, Inc., as underwriter.
Article IV. Terms. The terms of the series of Securities established
pursuant to this Officers' Certificate shall be as follows:
Section 4.01. Title. The Securities of such series shall be
designated as the "4.00% Exchangeable Senior Debentures due 2025" of
the Operating Partnership (the "Debentures").
Section 4.02. Aggregate Principal Amount. The aggregate
principal amount of Debentures which may be authenticated and
delivered under the Indenture is initially limited in aggregate
principal amount to $250,000,000, as such amount may be increased,
but not by an amount in excess of $37,500,000, solely as a result of
the purchase of Additional Debentures pursuant to the underwriter's
over-allotment option granted by the
5
Operating Partnership under the Underwriting Agreement, except for
Debentures authenticated and delivered upon registration of transfer
of, or in exchange for, or in lieu of, other Debentures pursuant to
Section 304, 305, 306, 905, 1107 or 1203 of the Indenture and except
for any Debentures which, pursuant to Section 303 of the Indenture,
are deemed never to have been authenticated and delivered
thereunder; provided that the Operating Partnership may from time to
time, without notice to or the consent of the Holders of the
Debentures, create and issue further Securities (the "Additional
Debentures") having the same terms and ranking equally and ratably
with the Debentures in all respects and with the same CUSIP number
as the Debentures, except for the issue price and interest accrued
prior to the issue date of such Additional Debentures. Any
Additional Debentures will be consolidated and form a single series
with the Debentures and shall have the same terms as to status,
redemption and otherwise as the Debentures.
Section 4.03. Registered Securities in Book-Entry Form. The
Debentures shall be issuable in the form of one or more global
Securities registered in the name of The Depository Trust Company's
nominee, and shall be deposited with, or on behalf of, The
Depository Trust Company, New York, New York (the "Depositary"). The
Debentures may be surrendered for registration of transfer and for
exchange at the office or agency of the Operating Partnership or the
Company (including the Trustee) maintained for such purpose in the
Borough of Manhattan, The City of New York, or at any other office
or agency maintained by the Operating Partnership or the Company for
such purpose.
Section 4.04. Stated Maturity of Principal. The Stated Maturity
of the principal of the Debentures shall be June 15, 2025.
Section 4.05. Interest. The Debentures shall bear interest at
the rate of 4.00% per annum from June 27, 2005 or from the most
recent Interest Payment Date to which interest has been paid or duly
provided for, as the case may be, payable semi-annually in arrears
on June 15 and December 15 of each year (each, an "Interest Payment
Date"), commencing on December 15, 2005, until the principal thereof
is paid or duly made available for payment, to the Persons in whose
names such Debentures are registered at the close of business on the
June 1 or December 1 (whether or not a Business Day in The City of
New York) immediately preceding the applicable Interest Payment Date
(each, a "Regular Record Date"). Interest payable on each Interest
Payment Date shall equal the amount of interest accrued for the
period commencing on and including the immediately preceding
Interest Payment Date in respect of which interest has been paid (or
commencing on and including June 27, 2005, if no interest has been
paid) and ending on and including the day preceding such Interest
Payment Date. Interest on the Debentures will be computed on the
basis of a 360-day year consisting of twelve 30-day months.
If the Operating Partnership shall redeem the Debentures in
accordance with the provisions of Section 4.07 hereof, or if a
Holder shall surrender a Debenture for repurchase by the Operating
Partnership in accordance with the provisions of 4.08 or 4.09
hereof, accrued and unpaid interest, if any, shall be payable to the
Holder that shall have surrendered such Debenture for redemption or
repurchase, as the case may be. However, if an Interest Payment Date
shall fall on or prior to the Redemption Date or Optional
6
Repurchase Date or Change in Control Purchase Date, as the case may
be, for a Debenture, accrued and unpaid interest due on such
Interest Payment Date shall be payable instead to the Person in
whose name such Debenture is registered at the close of business on
the related Regular Record Date.
Section 4.06. Place of Payment. The principal of and the
interest on the Debentures shall be payable at the office or agency
of the Company or the Operating Partnership (including the Trustee)
maintained for such purpose in the Borough of Manhattan, The City of
New York in the in the manner specified in the Indenture.
Section 4.07. Redemption. The Operating Partnership shall not
have the right to redeem any Debentures prior to June 18, 2010,
except to preserve the Company's status as a real estate investment
trust. If the Operating Partnership determines it is necessary to
redeem the Debentures in order to preserve the Company's status as a
real estate investment trust, the Operating Partnership may, upon
not less than 30 nor more than 60 days' prior written notice by mail
to the Holders of the Debentures, redeem the Debentures for cash, in
whole or in part, at 100% of the principal amount of the Debentures
to be redeemed plus unpaid interest, if any, accrued thereon to the
Redemption Date. In such case, the Operating Partnership shall
provide the Trustee with an Officers' Certificate evidencing that
the Board of Directors of the Company has, in good faith, made the
determination that it is necessary to redeem the Debentures in order
to preserve the Company's status as a real estate investment trust.
The Operating Partnership shall have the right to redeem the
Debentures for cash, in whole or in part at any time or from time to
time, on or after June 18, 2010 upon not less than 30 nor more than
60 days' prior written notice by mail to the registered Holders of
the Debentures, at a redemption price ("Redemption Price") equal to
100% of the principal amount of the Debentures to be redeemed plus
unpaid interest, if any, accrued thereon to the Redemption Date. If
less than all the Debentures are to be redeemed, the Trustee shall
select the Debentures to be redeemed on a pro rata basis or by any
other method the Trustee considers fair and appropriate. The Trustee
shall make the selection at least 30 days but not more than 60 days
before the Redemption Date from Outstanding Debentures not
previously called for redemption. Debentures and portions of the
principal amount thereof selected for redemption shall be in
integral multiples of $1,000. The Trustee shall notify the Operating
Partnership promptly of the Debentures or portions of the principal
amount thereof to be redeemed. If any Debenture selected for partial
redemption is exchanged in part in accordance with the provisions of
Section 4.11 hereof before termination of the exchange right with
respect to the portion of the Debenture so selected, the exchanged
portion of such Debenture shall be deemed to be from the portion
selected for redemption. Debentures that have been exchanged during
a selection of Debentures to be redeemed shall be treated by the
Trustee as Outstanding for the purpose of such selection.
In the event of any redemption in part, the Operating
Partnership shall not be required to: (i) issue or register the
transfer or exchange of any Debenture during a period beginning at
the opening of business 15 days before any selection of Debentures
for redemption and ending at the close of business on the earliest
date on which the relevant
7
notice of redemption is deemed to have been given to all Holders of
Debentures to be so redeemed, or (ii) register the transfer or
exchange of any Debenture so selected for redemption, in whole or in
part, except the unredeemed portion of any Debenture being redeemed
in part.
In addition to those matters set forth in Section 1104 of the
Indenture, a notice of redemption sent to the Holders of Debentures
to be redeemed in accordance with the provisions of the two
preceding paragraphs shall state:
(a) the name of the Paying Agent and Exchange Agent;
(b) the then current Exchange Rate;
(c) that Debentures called for redemption may be exchanged at
any time prior to the close of business on the fifth
Business Day immediately preceding the Redemption Date;
and
(d) that Holders who wish to exchange Debentures must comply
with the procedures relating thereto specified in Section
4.13 hereof.
Section 4.08. Repurchase Rights. A Holder of Debentures shall
have the right to require the Operating Partnership to repurchase
all of its Debentures, or any portion of the principal amount
thereof that is equal to $1,000 or an integral multiple thereof, on
each of June 15, 2010, June 15, 2015 and June 15, 2020 (each, an
"Optional Repurchase Date") for cash equal to 100% of the principal
amount of the Debentures to be repurchased plus unpaid interest, if
any, accrued thereon to the Optional Repurchase Date (such amount,
the "Optional Repurchase Price"), subject to satisfaction by or on
behalf of the Holder of the requirements set forth below.
On or before to the 30th day prior to each Optional Repurchase
Date, the Operating Partnership shall provide a written notice by
first-class mail to the Trustee, any Paying Agent and to all Holders
(and to beneficial owners as required by applicable law). The notice
shall include a form of Optional Repurchase Notice to be completed
by the Holder and shall state:
(a) the date by which the Optional Repurchase Notice must be
delivered to the Paying Agent;
(b) the Optional Repurchase Date;
(c) the Optional Repurchase Price;
(d) the name and address of the Trustee, the Paying Agent and
the Exchange Agent;
(e) that Debentures must be surrendered to the Paying Agent to
collect payment of the Optional Repurchase Price;
8
(f) that the Optional Repurchase Price for any Debenture as to
which an Optional Repurchase Notice has been duly given
will be paid on the Optional Repurchase Date, or if the
Debentures are surrendered on or after the Optional
Repurchase Date, on the second Business Day following the
date on which such Debentures are surrendered for
repurchase;
(g) that, unless the Operating Partnership defaults in making
payment of the Optional Repurchase Price, interest on
Debentures surrendered for repurchase will cease to accrue
on and after the Optional Repurchase Date;
(h) that Debentures in respect of which an Optional Repurchase
Notice is provided by a Holder shall not be exchangeable
in accordance with their terms even if otherwise
exchangeable unless such Holder validly withdraws such
Optional Repurchase Notice in accordance with the
provisions of this Section 4.08; and
(i) the CUSIP number of the Debentures.
The Operating Partnership shall also disseminate a press
release through Dow Jones & Company, Inc. or Bloomberg Business News
containing the information specified in such notice or publish such
information in a newspaper of general circulation in The City of New
York or on the Company's website, or through such other public
medium as the Operating Partnership shall deem appropriate at such
time.
A Holder may exercise its rights specified in this Section 4.08
upon delivery of a written notice of repurchase (an "Optional
Repurchase Notice") to the Paying Agent during the period beginning
at any time from the opening of business on the date that is 30 days
prior to the applicable Optional Repurchase Date until the close of
business on the fifth Business Day prior to such Optional Repurchase
Date, stating:
(a) if such Debentures are in certificated form, the
certificate number(s) of the Debentures which the Holder
will deliver to be repurchased or, if such Debentures are in
book-entry form, that such notice complies with the
appropriate procedures of the Depositary;
(b) the portion of the principal amount of the Debentures to
be repurchased, in integral multiples of $1,000, provided
that the remaining principal amount of Debentures is in an
authorized denomination; and
(c) that such Debenture shall be repurchased pursuant to the
terms and conditions hereof and the Debentures.
The Paying Agent shall promptly notify the Operating Partnership and
the Company in writing of the receipt by it of any Optional Repurchase
Notice.
Book-entry transfer of Debentures in book-entry form in
compliance with appropriate procedures of the Depositary or delivery
of Debentures in certificated form
9
(together with all necessary endorsements) to the Paying Agent prior
to, on or after the Optional Repurchase Date at the offices of the
Paying Agent shall be a condition to the receipt by the Holder of
the Optional Repurchase Price therefor. Holders electing to require
the Operating Partnership to repurchase Debentures must effect such
transfer or delivery to the Paying Agent prior to the Optional
Repurchase Date to receive payment of the Optional Repurchase Price
on the Optional Repurchase Date. The Operating Partnership shall pay
the Optional Repurchase Price within two Business Days after any
such transfer or delivery on or after the Optional Repurchase Date.
An Optional Repurchase Notice may be withdrawn by a Holder by
means of a written notice of withdrawal delivered to the office of
the Paying Agent prior to the close of business on the fifth
Business Day prior to the Optional Repurchase Date specifying:
(a) the principal amount of Debentures in respect of which the
Optional Repurchase Notice is being withdrawn;
(b) the certificate number(s) of all withdrawn Debentures in
certificated form or that the withdrawal notice complies
with appropriate procedures of the Depositary with respect
to all withdrawn Debentures in book-entry form; and
(c) the principal amount of Debentures, if any, which remains
subject to the Optional Repurchase Notice.
On or before 10:00 a.m. (New York City time) on the Optional
Repurchase Date, the Operating Partnership shall deposit with the
Paying Agent (or if the Operating Partnership or an Affiliate of the
Operating Partnership is acting as the Paying Agent, shall segregate
and hold in trust) money sufficient to pay the aggregate Optional
Repurchase Price of the Debentures to be purchased pursuant to this
Section 4.08. If the Paying Agent holds, in accordance with the
terms of the Indenture, money sufficient to pay the Optional
Repurchase Price of such Debentures on the Optional Repurchase Date,
then, on and after such date, such Debentures shall cease to be
Outstanding and interest on such Debentures shall cease to accrue,
and all other rights of the Holder shall terminate (other than the
right to receive the Optional Repurchase Price upon delivery or
transfer of the Debentures). Such will be the case whether or not
book-entry transfer of the Debentures in book-entry form is made and
whether or not Debentures in certificated form, together with the
necessary endorsements, are delivered to the Paying Agent.
Notwithstanding the foregoing, no Debentures may be purchased
by the Operating Partnership in accordance with the provisions of
this Section 4.08 if there has occurred and is continuing an Event
of Default with respect to the Debentures (other than a default in
the payment of the Optional Repurchase Price).
To the extent legally required in connection with a repurchase
of Debentures, the Operating Partnership shall comply with the
provisions of Rule 13e-4 and other tender offer rules under the
Exchange Act then applicable, if any, and will file a Schedule TO or
any other schedule required under the Exchange Act.
10
The Operating Partnership may arrange for a third party to
purchase Debentures for which the Operating Partnership has received
a valid Optional Repurchase Notice that has not been properly
withdrawn in the manner and otherwise in compliance with the
requirements set forth herein and in the Debentures. If a third
party purchases any Debentures under such circumstances, then
interest will continue to accrue on the Debentures and such
Debentures will continue to be Outstanding for all purposes of the
Indenture.
Section 4.09. Repurchase at Option of Holders upon a Change in
Control. If a Change in Control occurs at any time prior to June 15,
2010, a Holder of Debentures shall have the right to require the
Operating Partnership to repurchase all of its Debentures, or any
portion of the principal amount thereof that is equal to $1,000 or
an integral multiple thereof, for cash equal to 100% of the
principal amount of the Debentures to be repurchased, plus unpaid
interest, if any, accrued thereon to the Change in Control Purchase
Date (such amount, the "Change in Control Purchase Price"), subject
to satisfaction by or on behalf of the Holder of the requirements
set forth below.
Within 20 days after the occurrence of a Change in Control, the
Operating Partnership shall mail a written notice of Change in
Control (the "Company Notice") by first-class mail to the Trustee,
any Paying Agent and to each Holder (and to beneficial owners as
required by applicable law). The notice shall include a form of
Change in Control Purchase Notice to be completed by the Holder and
shall state:
(a) briefly, the events causing a Change in Control and the
date of such Change in Control;
(b) the date by which the Change in Control Purchase Notice
must be delivered to the Paying Agent;
(c) the date on which the Operating Partnership will
repurchase Debentures upon a Change in Control, which must
be not less than 15 nor more than 30 days after the date
of the Company Notice (such date, the "Change in Control
Purchase Date");
(d) the Change in Control Purchase Price;
(e) the name and address of the Trustee, the Paying Agent and
the Exchange Agent;
(f) that Debentures in respect of which a Change in Control
Purchase Notice is provided by a Holder shall not be
exchangeable unless such Holder validly withdraws such
Change in Control Purchase Notice in accordance with the
provisions of this Section 4.09;
(g) that Debentures must be surrendered to the Paying Agent to
collect payment of the Change in Control Purchase Price;
11
(h) that the Change in Control Purchase Price for any
Debenture as to which a Change in Control Purchase Notice
has been duly given will be paid on the Change in Control
Purchase Date, or if the Debentures are surrendered on or
after the Change in Control Purchase Date, on the second
Business Day following the date on which such Debentures
are surrendered;
(i) that, unless the Operating Partnership defaults in making
payment of such Change in Control Purchase Price, interest
on Debentures surrendered for purchase will cease to
accrue on and after the Change in Control Purchase Date;
and
(j) the CUSIP number of the Debentures.
The Operating Partnership shall also disseminate a press
release through Dow Jones & Company, Inc. or Bloomberg Business News
announcing the occurrence of such Change in Control or publish such
information in a newspaper of general circulation in The City of New
York or on the Company's website, or through such other public
medium as the Operating Partnership shall deem appropriate at such
time.
A Holder may exercise its rights specified in this Section 4.09
upon delivery of a written notice of repurchase (a "Change in
Control Purchase Notice") to the Trustee (or any Paying Agent) at
any time prior to the close of business on the fifth Business Day
prior to the Change in Control Purchase Date, stating:
(a) if such Debentures are in certificated form, the
certificate number(s) of the Debentures which the Holder
will deliver to be repurchased or, if such Debentures are
in book-entry form, that such notice complies with the
appropriate procedures of the Depositary;
(b) the portion of the principal amount of the Debentures to
be repurchased, in integral multiples of $1,000, provided
that the remaining principal amount of Debentures is in an
authorized denomination; and
(c) that such Debenture shall be repurchased pursuant to the
terms and conditions hereof and of the Debentures.
The Trustee (or any Paying Agent) shall promptly notify the
Operating Partnership and the Company in writing of the receipt by
it of any Change in Control Purchase Notice.
Book-entry transfer of Debentures in book-entry form in
compliance with appropriate procedures of the Depositary or delivery
of Debentures in certificated form (together with all necessary
endorsements) to the Trustee prior to, on or after the Change in
Control Purchase Date at the offices of the Trustee (or any Paying
Agent) shall be a condition to the receipt by the Holder of the
Change in Control Purchase Price therefor. Holders electing to
require the Operating Partnership to repurchase Debentures must
either effect such transfer or delivery to the Trustee (or any
Paying Agent) prior to the Change in Control Purchase Date to
receive payment of the Change in Control Purchase Price on the
Change in Control Purchase Date. The Operating Partnership shall pay
the
12
Change in Control Purchase Price within two Business Days after any
such transfer or delivery on or after the Change in Control Purchase
Date.
A Change in Control Purchase Notice may be withdrawn by a
Holder means of a written notice of withdrawal delivered to the
office of the Paying Agent prior to the close of business on the
fifth Business Day prior to the Change in Control Purchase Date
specifying:
(a) the principal amount of Debentures in respect of which the
Change in Control Purchase Notice is being withdrawn;
(b) the certificate number(s) of all withdrawn Debentures in
certificated form or that the withdrawal notice complies
with appropriate procedures of the Depositary with respect
to all withdrawn Debentures in book-entry form; and
(c) the principal amount of Debentures, if any, which remains
subject to the Change in Control Purchase Notice.
On or before 10:00 a.m. (New York City time) on the Change in
Control Purchase Date, the Operating Partnership shall deposit with
the Paying Agent (or if the Operating Partnership or an Affiliate of
the Operating Partnership is acting as the Paying Agent, shall
segregate and hold in trust) money sufficient to pay the aggregate
Change in Control Purchase Price of the Debentures to be purchased
pursuant to this Section 4.09. If the Paying Agent holds, in
accordance with the terms of the Indenture, money sufficient to pay
the Change in Control Purchase Price of such Debentures on the
Change in Control Purchase Date, then, on and after such date, such
Debentures shall cease to be Outstanding and interest on such
Debentures shall cease to accrue and all other rights of the Holder
shall terminate (other than the right to receive the Change in
Control Purchase Price upon delivery or transfer of the Debentures).
Such will be the case whether or not book-entry transfer of the
Debentures in book-entry form is made and whether or not Debentures
in certificated form, together with the necessary endorsements, are
delivered to the Paying Agent.
Notwithstanding the foregoing, no Debentures may be repurchased
by the Operating Partnership in accordance with the provisions of
this Section 4.09 if there has occurred and is continuing an Event
of Default with respect to the Debentures (other than a default in
the payment of the Change in Control Purchase Price).
To the extent legally required in connection with a repurchase
of Debentures, the Operating Partnership shall comply with the
provisions of Rule 13e-4 and other tender offer rules under the
Exchange Act then applicable, if any, and will file a Schedule TO or
any other schedule required under the Exchange Act.
The Operating Partnership may arrange for a third party to
purchase Debentures for which the Operating Partnership has received
a valid Change in Control Purchase Notice that has not been properly
withdrawn in the manner and otherwise in compliance with the
requirements set forth herein and in the Debentures. If a third
party purchases
13
any Debentures under such circumstances, then interest will continue
to accrue on the Debentures and such Debentures will continue to be
Outstanding for all purposes of the Indenture.
Section 4.10. Make Whole Amount and Public Acquirer Change in
Control. If a transaction described in clause (1) of the definition
of Change in Control occurs prior to June 15, 2010 and a Holder
elects to exchange its Debentures in connection with such Change in
Control, the Operating Partnership shall increase the applicable
Exchange Rate for the Debentures surrendered for exchange by a
number of additional Company Common Shares (the "Additional Shares")
as specified below. An exchange of Debentures shall be deemed for
these purposes to be "in connection with" such a Change in Control,
subject to the Operating Partnership's rights with respect to a
"Public Acquirer Change in Control" specified in the fourth to last
paragraph of this Section 4.10, if the notice of exchange of the
Debentures is received by the Exchange Agent on any date from and
including the date that is the 15th Business Day prior to the
anticipated Effective Date (as defined below) of such Change in
Control up to and including the fifth Business Day following the
Effective Date of such Change in Control.
The number of Additional Shares will be determined by reference
to the table below and is based on the date on which such Change in
Control transaction becomes effective (the "Effective Date") and the
price (the "Stock Price") paid per Company Common Share in such
Change in Control transaction. If holders of Company Common Shares
receive only cash in the applicable Change in Control transaction,
the Stock Price shall be the cash amount paid per Company Common
Share. Otherwise, the Stock Price shall be the average of the
Closing Sale Prices of Company Common Shares on the 10 consecutive
Trading Days up to but excluding the Effective Date.
The Stock Prices set forth in the first row of the table (i.e.,
the column headers) will be adjusted as of any date on which the
Exchange Rate of the Debentures is adjusted. The adjusted Stock
Prices will equal the Stock Prices applicable immediately prior to
such adjustment multiplied by a fraction, the numerator of which is
the Exchange Rate immediately prior to the adjustment giving rise to
the Stock Price adjustment and the denominator of which is the
Exchange Rate as so adjusted. In addition, the number of Additional
Shares will be subject to adjustment in the same manner as the
Exchange Rate in accordance with the provisions of Section 4.14
hereof.
The following table sets forth the Stock Price and number of
Additional Shares to be received per $1,000 principal amount of
Debentures:
Effective Stock Price
_______________________________________________________________________________________
Date $32.50 $35.00 $37.50 $40.00 $42.50 $45.00 $50.00 $55.00
_________ ________ __________ _________ __________ _________ _________ __________ ________
6/21/05 5.5265 3.9416 2.7371 1.8436 1.1955 0.7378 0.2106 0.0000
6/15/06 5.6283 3.9790 2.7349 1.8121 1.1464 0.6792 0.1488 0.0000
6/15/07 5.7272 3.9961 2.6812 1.7166 1.0346 0.5706 0.0836 0.0000
6/15/08 5.8046 3.9666 2.5694 1.5581 0.8649 0.4148 0.0000 0.0000
6/15/09 5.8961 3.8847 2.3372 1.2453 0.5532 0.1620 0.0000 0.0000
6/15/10 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000
14
The exact Stock Prices and Effective Dates may not be set forth
on the table, in which case:
(a) if the Stock Price is between two Stock Price amounts in
the table or the Effective Date is between two dates in
the table, the Additional Shares will be determined by
straight-line interpolation between the number of
Additional Shares set forth for the higher and lower Stock
Price amounts and the two dates, as applicable, based on a
365-day year;
(b) if the Stock Price is equal to or in excess of $55.00 per
Company Common Share (subject to adjustment as specified
in the second preceding paragraph), no Additional Shares
will be issued upon an exchange of Debentures; and
(c) if the Stock Price is less than $32.50 per Company Common
Share (subject to adjustment as specified in the second
preceding paragraph), no Additional Shares will be issued
upon an exchange of Debentures.
Notwithstanding the foregoing, in no event shall the total
number of Company Common Shares issuable upon an exchange of
Debentures exceed 30.7692 shares per $1,000 principal amount of
Debentures, subject to adjustment in the same manner as the Exchange
Rate pursuant to Section 4.14 hereof.
Notwithstanding the foregoing, and in lieu of adjusting the
Exchange Rate as set forth above in this Section 4.10, in the case
of a Public Acquirer Change in Control, the Operating Partnership
may, at any time prior to the 15th Business Day immediately
preceding the proposed Effective Date of the Public Acquirer Change
in Control, irrevocably elect to change the exchange obligation of
the Operating Partnership with respect to the Debentures into an
obligation to deliver, upon an exchange of Debentures, cash, shares
of Acquirer Common Stock, or a combination thereof, at the option of
the Operating Partnership in the same manner as the Operating
Partnership would otherwise be required to satisfy its exchange
obligations in accordance with the provisions of Section 4.12
hereof. If the Operating Partnership makes such an election, the
Exchange Rate at the effective time of such Public Acquirer Change
in Control will be a number of shares of Acquirer Common Stock equal
to the product of:
(a) the Exchange Rate in effect immediately prior to the
Effective Date of such Public Acquirer Change in Control,
times
(b) the average of the quotients obtained, for each Trading
Day in the 10 consecutive Trading Day period commencing on
the Trading Day next succeeding the Effective Date of such
Public Acquirer Change in Control (the "valuation
period"), of:
(i) the "acquisition value" of Company Common Shares on
each such Trading Day in the valuation period,
divided by
15
(ii) the Closing Sale Price of the Acquirer Common Stock
on each such Trading Day in the valuation period.
If the Operating Partnership elects to adjust the exchange
right and exchange obligation in connection with a Public Acquirer
Change in Control as described in this Section 4.10, it must send
Holders of Debentures written notice of the adjustment not later
than 15 Business Days prior to but excluding the expected Effective
Date of such Public Acquirer Change in Control and thereafter cause
to be executed a supplemental indenture (which shall comply with the
Trust Indenture Act as in force at the date of execution of such
supplemental indenture) giving due effect to such election. If the
Operating Partnership makes such an election, Holders of Debentures
who tender their Debentures for exchange will not have the right to
receive any Additional Shares in accordance with the provisions of
this Section 4.10.
The "acquisition value" of Company Common Shares means, for
each Trading Day in the valuation period, the value of the
consideration paid per Company Common Share in connection with such
Public Acquirer Change in Control, as follows:
(a) for any cash, 100% of the face amount of such cash;
(b) for any Acquirer Common Stock, 100% of the Closing Sale
Price of such Acquirer Common Stock on each such Trading
Day; and
(c) for any other securities, assets or property, 100% of the
fair market value of such securities, assets or property
on each such Trading Day, as determined by the Company's
Board of Directors.
After the adjustment of the Exchange Rate in connection with a
Public Acquirer Change in Control, the Exchange Rate will be subject
to further adjustments in the event that any of the events described
in Section 4.14 hereof occur thereafter.
Section 4.11. Exchange Rights.
Subject to the restrictions on ownership of Company Common
Shares as set forth in Section 4.15 hereof and to the conditions set
forth herein, Holders may surrender their Debentures for exchange at
any time prior to the close of business on the second Business Day
immediately preceding the Stated Maturity of the Debentures at any
time on or after June 15, 2024 and also under any of the
circumstances set forth in this Section 4.11.
(a) Exchange Upon Satisfaction of Market Price Condition.
A Holder may surrender any of its Debentures for exchange
during any calendar quarter beginning after September 30, 2005
if, and only if, the Closing Sale Price of Company Common
Shares for at least 20 Trading Days in the period of 30
consecutive Trading Days ending on the last Trading Day of the
preceding calendar quarter is more than 125% of the Exchange
Price per Company Common Share in effect on the applicable
Trading Day. The Board of Directors of the Company shall make
appropriate adjustments, in its good faith determination, to
account for any adjustment to the
16
Exchange Rate that becomes effective, or any event requiring an
adjustment to the Exchange Rate where the ex-dividend date of
the event occurs, during that 30 consecutive trading-day
period.
(b) Exchange Upon Satisfaction of Trading Price Condition.
A Holder may surrender any of its Debentures for exchange
during the five consecutive Trading Day period following any 20
consecutive Trading Days in which the Trading Price per $1,000
principal amount of Debentures (as determined following a
reasonable request by a Holder of the Debentures) was less than
98% of the product of the Closing Sale Price of Company Common
Shares multiplied by the Exchange Rate in effect on the
applicable Trading Day.
The Trustee shall have no obligation to determine the
Trading Price of the Debentures unless the Operating
Partnership shall have requested such determination, and the
Operating Partnership shall have no obligation to make such
request unless a Holder provides the Operating Partnership with
written reasonable evidence that the Trading Price per $1,000
principal amount of the Debentures would be less than 98% of
the product of the Closing Sale Price of Company Common Shares
and the Exchange Rate, whereupon the Operating Partnership
shall instruct the Trustee to determine the Trading Price of
the Debentures beginning on the next Trading Day and on each
successive Trading Day until the Trading Price is greater than
or equal to 98% of the product of the Closing Sale Price of
Company Common Shares and the Exchange Rate.
(c) Exchange Upon Notice of Redemption. A Holder may
surrender for exchange any of the Debentures called for
redemption at any time prior to the close of business on the
fifth Business Day prior to the Redemption Date, even if the
Debentures are not otherwise exchangeable at such time. The
right to exchange Debentures pursuant to this clause (c) will
expire after the close of business on the fifth Business Day
prior to the Redemption Date unless the Operating Partnership
defaults in making the payment due upon redemption. A Holder
may exchange fewer than all of its Debentures so long as the
Debentures exchanged are an integral multiple of $1,000
principal amount and the remaining principal amount of
Debentures is in an authorized denomination. However, if a
Holder has already delivered an Optional Repurchase Notice or a
Change in Control Purchase Notice with respect to a Debenture,
such Holder may not surrender such Debenture for exchange until
it has withdrawn such notice in accordance with the applicable
provisions of Section 4.08 or 4.09 hereof, as the case may be.
(d) Exchange Upon Specified Transactions. If the Company
elects to:
(i) distribute to all holders of Company Common Shares
rights entitling them to purchase, for a period
expiring within 45 days, Company Common Shares at
less than the Closing Sale Price of Company Common
Shares on the Trading Day immediately preceding
the declaration date of the distribution; or
17
(ii) distribute to all holders of Company Common Shares
assets, debt securities or rights to purchase
securities of the Operating Partnership or the
Company, which distribution has a per share value
exceeding 10% of the Closing Sale Price of Company
Common Shares on the Trading Day immediately
preceding the declaration date of such
distribution,
the Operating Partnership shall notify the Holders of the
Debentures in writing at least 20 days prior to the ex-dividend
date for such distribution. Following the issuance of such
notice, Holders may surrender their Debentures for exchange at
any time until the earlier of the close of business on the
Business Day prior to the ex-dividend date or an announcement
that such distribution will not take place; provided, however,
that a Holder may not exercise this right to exchange if the
Holder may participate, on an as-exchanged basis, in the
distribution without an exchange of Debentures. The ex-dividend
date is the first date upon which a sale of the Company Common
Shares does not automatically transfer the right to receive the
relevant distribution from the seller of Company Common Shares
to its buyer.
In addition, if the Operating Partnership or the Company
is party to a consolidation, merger or binding share exchange
pursuant to which all of the Company Common Shares would be
exchanged for cash, securities or other property, a Holder may
surrender Debentures for exchange at any time from and
including the date that is 15 Business Days prior to the
anticipated effective time of the transaction up to and
including five Business Days after the actual date of such
transaction. The Operating Partnership shall notify Holders as
promptly as practicable following the date it publicly
announces such transaction (but in no event less than 15
Business Days prior to the effective time of such transaction).
If the Operating Partnership or the Company is a party to
a consolidation, merger or binding share exchange pursuant to
which all of the Company Common Shares are exchanged for cash,
securities or other property, then at the effective time of the
transaction any exchange of Debentures and the Exchange Value
will be based on the kind and amount of cash, securities or
other property that the Holder would have received if the
Holder had exchanged its Debentures immediately prior to the
effective time of the transaction (assuming such Holder did not
exercise his rights of election, if any, as to the kind or
amount of securities, cash or other property receivable upon
such consolidation, merger or binding share exchange) unless
the Operating Partnership has elected to adjust the Exchange
Rate and the exchange right for a Public Acquirer Change in
Control as described in Section 4.10 hereof. If such
transaction constitutes a Change in Control as described in
clause (1) of the definition thereof, the Operating Partnership
will adjust the Exchange Rate for Debentures tendered for
exchange in connection with such a Change in Control
transaction, as described in Section 4.10 hereof. However, the
Operating Partnership shall not make such an adjustment if such
Change in Control also constitutes a Public Acquirer Change in
Control and the Operating Partnership elects to modify the
Exchange Rate and the
18
exchange right as described in the third to last paragraph of
Section 4.10 hereof. In addition, if such transaction
constitutes a Change in Control, each Holder shall be able to
require the Operating Partnership to repurchase all or a
portion of such Holder's Debentures in the manner set forth in
Section 4.09 hereof.
In connection with any consolidation, merger or binding
exchange, the Operating Partnership will specify in the notice
to Holders whether Holders will be entitled to Additional
Shares or cash, Acquirer Common Stock or a combination of cash
and Acquirer Common Stock, at the option of the Operating
Partnership, as described in Section 4.10.
(e) Exchange Upon Delisting of Company Common Shares. A
Holder of Debentures may surrender any of its Debentures for
exchange at any time beginning on the first Business Day after
the Company Common Shares have ceased to be listed on a U.S.
national or regional securities exchange or quoted on NASDAQ
for a 30 consecutive Trading Day period.
Section 4.12. Exchange Settlement. Subject to the provisions of
Section 4.10, upon an exchange of Debentures, the Operating
Partnership shall deliver, in respect of each $1,000 principal
amount of Debentures tendered for exchange in accordance with their
terms:
(a) cash in an amount (the "Principal Return") equal to the
lesser of (1) the principal amount of the Debentures
surrendered for exchange and (2) the Exchange Value, and
(b) if the Exchange Value is greater than the Principal
Return, an amount (the "Net Amount") in cash and/or
Company Common Shares with an aggregate value equal to the
difference between the Exchange Value and the Principal
Return.
The Operating Partnership may elect to deliver any portion of
the Net Amount in cash (the "Net Cash Amount") or Company Common
Shares, and any portion of the Net Amount the Operating Partnership
elects to deliver in Company Common Shares (the "Net Shares") will
be the sum of the Daily Share Amounts for each Trading Day during
the Applicable Exchange Period. Prior to the close of business on
the second Trading Day following the date on which Debentures are
tendered for exchange, the Operating Partnership shall inform
Holders of such Debentures of its election to pay cash for all or a
portion of the Net Amount and, if applicable, the portion of the Net
Amount that will be paid in cash and the portion that will be
delivered in the form of Net Shares.
The Operating Partnership shall deliver cash in lieu of any
fractional Company Common Shares issuable in connection with payment
of the Net Shares based upon the Average Price.
The "Daily Share Amount" for each $1,000 principal amount of
Debentures and each Trading Day in the Applicable Exchange Period is
equal to the greater of:
19
(a) zero; and
(b) a number of Company Common Shares determined by the
following formula:
__ ___
| (CSP x ER) - ($1,000 + the Net Cash Amount, if any) |
| --------------------------------------------------------------- |
| 10 x CSP |
|__ ___|
where
CSP means the Closing Sale Price of Company Common Shares on
such Trading Day, and
ER means the applicable Exchange Rate
The Operating Partnership will determine the Exchange Value,
Principal Return, Net Amount, Net Cash Amount and the number of Net
Shares, as applicable, promptly after the end of the Applicable
Exchange Period. The Operating Partnership shall pay the Principal
Return and cash in lieu of fractional shares, and deliver Net Shares
or pay the Net Cash Amount, as applicable, no later than the third
Business Day following the determination of the Average Price.
Section 4.13. Exchange Procedures. To exchange Debentures, a
Holder must satisfy the requirements set forth in this Section 4.13.
To exchange the Debentures, a Holder must (a) complete and
manually sign the irrevocable exchange notice on the reverse of the
Debenture (or complete and manually sign a facsimile of such notice)
and deliver such notice to the Exchange Agent at the office
maintained by the Exchange Agent for such purpose, (b) with respect
to Debentures which are in certificated form, surrender the
Debentures to the Exchange Agent, (c) furnish appropriate
endorsements and transfer documents if required by the Exchange
Agent, the Company or the Trustee and (d) pay any transfer or
similar tax, if required. The date on which the Holder satisfies all
such requirements shall be deemed to be the date on which the
applicable Debentures shall have been tendered for exchange.
Debentures in respect of which a Holder has delivered an
Optional Repurchase Notice or Change in Control Purchase Notice may
be exchanged only if such notice is withdrawn in accordance with the
terms of Section 4.08 or Section 4.09, as the case may be.
In case any Debenture shall be surrendered for partial
exchange, the Operating Partnership shall execute and the Trustee
shall authenticate and deliver to, or upon the written order of, the
Holder of the Debenture so surrendered, without charge to such
holder, a new Debenture or Debentures in authorized denominations in
an aggregate principal amount equal to the portion of the
surrendered Debentures not surrendered for
20
exchange. A Holder may exchange fewer than all of such Holder's
Debentures so long as the Debentures exchanged are an integral
multiple of $1,000 principal amount.
Upon surrender of a Debenture for exchange by a Holder, such
Holder shall deliver to the Operating Partnership cash equal to the
amount that the Operating Partnership is required to deduct and
withhold under applicable law in connection with the exchange;
provided, however, if the Holder does not deliver such cash, the
Operating Partnership may deduct and withhold from the amount of
consideration otherwise deliverable to such Holder the amount
required to be deducted and withheld under applicable law.
A Holder will not receive any cash payment representing accrued
and unpaid interest upon exchange of a Debenture. Instead, upon an
exchange of Debentures, the Operating Partnership will deliver to
tendering Holders only the consideration specified in Section 4.12.
Delivery of cash and Company Common Shares, if any, upon an exchange
of Debentures will be deemed to satisfy the Operating Partnership's
obligation to pay the principal amount of the Debentures and any
accrued and unpaid interest. Accordingly, upon an exchange of
Debentures, any accrued and unpaid interest will be deemed paid in
full rather than canceled, extinguished or forfeited. In no event
will the Exchange Rate be adjusted to account for accrued interest
on the Debentures.
Holders of Debentures at the close of business on a Regular
Record Date for an interest payment will receive payment of interest
payable on the corresponding Interest Payment Date, notwithstanding
the exchange of such Debentures at any time after the close of
business on the applicable Regular Record Date. Debentures tendered
for exchange by a Holder after the close of business on any Regular
Record Date for an interest payment and on or prior to the
corresponding Interest Payment Date must be accompanied by payment
of an amount equal to the interest that such Holder is to receive on
such Debentures on such Interest Payment Date; provided, however,
that no such payment shall be required (1) if such Debentures have
been called for redemption on a Redemption Date that is after such
Regular Record Date and on or prior to such Interest Payment Date or
(2) with respect to overdue interest, if any overdue interest exists
at the time of exchange with respect to such Debentures.
Upon exchange of a Debenture, the Operating Partnership, if it
elects to deliver Net Shares, will pay any documentary, stamp or
similar issue or transfer tax due on the issue of the Net Shares, if
any, unless the tax is due because the Holder requests the shares to
be issued or delivered to a person other than the Holder, in which
case the Holder must pay the tax due prior to the delivery of such
Net Shares. Certificates representing Company Common Shares will not
be issued or delivered unless all taxes and duties, if any, payable
by the Holder have been paid.
A Holder of Debentures, as such, shall not be entitled to any
rights of a holder of Company Common Shares. Such Holder shall only
acquire such rights upon the delivery by the Operating Partnership,
at its option, of Net Shares in accordance with the provisions of
Section 4.12 in connection with the exchange by a Holder of
Debentures.
21
If a Holder exchanges more than one Debenture at the same time,
the number of Net Shares, if any, issuable upon the exchange shall
be based on the total principal amount of the Debentures surrendered
for exchange.
The Company shall, prior to issuance of any Debentures
hereunder, and from time to time as may be necessary, reserve out of
its authorized but unissued common stock a sufficient number of
Company Common Shares to permit the exchange of the Debentures. Any
Company Common Shares delivered upon an exchange of Debentures shall
be newly issued shares or treasury shares, shall be duly and validly
issued and fully paid and nonassessable and shall be free from
preemptive rights and free of any lien or adverse claim.
The Company shall endeavor promptly to comply with all federal
and state securities laws regulating the issuance and delivery of
Company Common Shares, if any, upon an exchange of Debentures and
shall cause to have listed or quoted all such Company Common Shares
on each U.S. national securities exchange or over-the-counter or
other domestic market on which the Company Common Shares are then
listed or quoted.
Except as set forth herein, no other payment or adjustment for
interest shall be made upon exchange of Debentures.
Section 4.14. Exchange Rate Adjustments. The Exchange Rate
shall be adjusted from time to time as follows:
(a) If the Company issues Company Common Shares as a
dividend or distribution on Company Common Shares to all
holders of Company Common Shares, or if the Company effects a
share split or share combination, the Exchange Rate will be
adjusted based on the following formula:
ER1 = ER0 x OS1/OS0
where
ER0 = the Exchange Rate in effect immediately
prior to the adjustment relating to
such event
ER1 = the new Exchange Rate in effect taking into
account such event
OS0 = the number of Company Common Shares
outstanding immediately prior to such event
OS1 = the number of Company Common Shares
outstanding immediately after such event.
Any adjustment made pursuant to this paragraph (a) shall become
effective on the date that is immediately after (x) the date
fixed for the determination of shareholders entitled to receive
such dividend or other distribution or (y) the date on which
such
22
split or combination becomes effective, as applicable. If any
dividend or distribution described in this paragraph (a) is
declared but not so paid or made, the new Exchange Rate shall be
readjusted to the Exchange Rate that would then be in effect if
such dividend or distribution had not been declared.
(b) If the Company issues to all holders of Company Common
Shares any rights, warrants, options or other securities
entitling them for a period of not more than 45 days after the
date of issuance thereof to subscribe for or purchase Company
Common Shares, or issues to all holders of Company Common
Shares securities convertible into Company Common Shares for a
period of not more than 45 days after the issuance thereof, in
either case at an exercise price per Company Common Share or a
conversion price per Company Common Share less than the Closing
Sale Price of Company Common Shares on the Business Day
immediately preceding the time of announcement of such
issuance, the Exchange Rate will be adjusted based on the
following formula:
ER1 = ER0 x (OS0+X)/(OS0+Y)
where
ER0 = the Exchange Rate in effect immediately prior
to the adjustment relating to such event
ER1 = the new Exchange Rate taking such event into
account
OS0 = the number of Company Common Shares
outstanding immediately prior to such event
X = the total number of Company Common
Shares issuable pursuant to such rights,
warrants, options, other securities or
convertible securities
Y = the number of Company Common Shares
equal to the quotient of (A) the aggregate
price payable to exercise such rights,
warrants, options, other securities or
convertible securities and (B) the average
of the Closing Sale Prices of Company
Common Shares for the 10 consecutive
Trading Days prior to the Business Day
immediately preceding the date of
announcement for the issuance of such
rights, warrants, options, other
securities or convertible securities.
For purposes of this paragraph (b), in determining whether any
rights, warrants, options, other securities or convertible
securities entitle the holders to subscribe for or purchase, or
exercise a conversion right for, Company Common Shares at less
than the applicable Closing Sale Price of Company Common
Shares, and in determining the aggregate exercise or conversion
price payable for such Company Common Shares, there shall be
taken into account any consideration received by the Company
for such rights, warrants, options, other securities or
convertible securities and any
23
amount payable on exercise or conversion thereof, with the
value of such consideration, if other than cash, to be
determined by the Company's Board of Directors. If any right,
warrant, option, other security or convertible security
described in this paragraph (b) is not exercised or converted
prior to the expiration of the exercisability or convertibility
thereof, the new Exchange Rate shall be readjusted to the
Exchange Rate that would then be in effect if such right,
warrant, option, other security or convertible security had not
been so issued.
(c) If the Company distributes shares of capital stock,
evidences of indebtedness or other assets or property of the
Company to all holders of Company Common Shares, excluding:
(i) dividends, distributions, rights, warrants,
options, other securities or convertible
securities referred to in paragraph (a) or (b)
above,
(ii) dividends or distributions paid exclusively in
cash, and
(iii) Spin-Offs described below in this paragraph (c)
then the Exchange Rate will be adjusted based on the following
formula:
ER1 = ER0 x SP0/(SP0-FMV)
where
ER0 = the Exchange Rate in effect immediately prior
to the adjustment relating to such event
ER1 = the new Exchange Rate taking such event into
account
SP0 = the average of the Closing Sale Prices
of Company Common Shares for the 10
consecutive Trading Days prior to the
Business Day immediately preceding the
earlier of the record date or the
ex-dividend date for such distribution
FMV = the fair market value (as determined in
good faith by the Company's Board of
Directors) of the shares of capital stock,
evidences of indebtedness, assets or
property distributed with respect to each
outstanding Company Common Share on the
earlier of the record date or the
ex-dividend date for such distribution.
An adjustment to the Exchange Rate made pursuant to the
immediately preceding paragraph shall be made successively
whenever any such distribution is made and shall become
effective on the day immediately after the date fixed for the
determination of holders of Company Common Shares entitled to
receive such distribution.
24
If the Company distributes to all holders of Company
Common Shares capital stock of any class or series, or similar
equity interest, of or relating to a subsidiary or other
business unit of the Company (a "Spin-Off"), the Exchange Rate
in effect immediately before the close of business on the date
fixed for determination of holders of Company Common Shares
entitled to receive such distribution will be adjusted based on
the following formula:
ER1 = ER0 x (FMV0+MP0)/MP0
where
ER0 = the Exchange Rate in effect immediately prior
to the adjustment relating to such event
ER1 = the new Exchange Rate taking such event into
account
FMV0= the average of the Closing Sale
Prices of the capital stock or similar
equity interest distributed to holders
of Company Common Shares applicable to
one Company Common Share over the
first 10 consecutive Trading Days
after the effective date of the
Spin-Off
MP0 = the average of the Closing Sale
Prices of Company Common Shares over
the first 10 consecutive Trading Days
after the effective date of the
Spin-Off.
An adjustment to the Exchange Rate made pursuant to the
immediately preceding paragraph will occur on the 10th Trading
Day from, and including, the effective date of the Spin-Off.
If any such dividend or distribution described in this
paragraph (c) is declared but not paid or made, the new
Exchange Rate shall be readjusted to be the Exchange Rate that
would then be in effect if such dividend or distribution had
not been declared.
(d) If the Company makes any cash dividend or distribution
during any of its quarterly fiscal periods to all holders of
Company Common Shares in an aggregate amount that, together
with other cash dividends or distributions made during such
quarterly fiscal period, exceeds the product of $0.4246 (the
"Reference Dividend") multiplied by the number of Company
Common Shares outstanding on the record date for such
distribution, the Exchange Rate will be adjusted based on the
following formula:
ER1 = ER0 x SP0/(SP0-C)
where
25
ER0 = the Exchange Rate in effect immediately prior
to the adjustment relating to such event
ER1 = the new Exchange Rate taking such event into
account
SP0 = the average of the Closing Sale Prices
of Company Common Shares for the 10
consecutive Trading Days prior to the
business day immediately preceding the
earlier of the record date or the day
prior to the ex-dividend date for such
distribution
C = the amount in cash per Company Common Share
that the Company distributes to holders of
Common Shares during such quarterly fiscal
Company period that exceeds the Reference
Dividend.
An adjustment to the Exchange Rate made pursuant to this
paragraph (d) shall become effective on the date immediately
after the date fixed for the determination of holders of
Company Common Shares entitled to receive such dividend or
distribution. If any dividend or distribution described in this
paragraph (d) is declared but not so paid or made, the new
Exchange Rate shall be readjusted to the Exchange Rate that
would then be in effect if such dividend or distribution had
not been declared.
The Reference Dividend shall be subject to adjustment on
account of any of the events set forth in paragraph (a) above.
Any such adjustment will be effected by multiplying the
Reference Dividend by a fraction, the numerator of which will
equal OS0 and the denominator of which will equal OS1, in each
case, within the meaning of paragraph (a) above.
(e) If the Company or any of its subsidiaries makes a
payment in respect of a tender offer or exchange offer for
Company Common Shares to the extent that the cash and value of
any other consideration included in the payment per Company
Common Share exceeds the Closing Sale Price of a Company Common
Share on the Trading Day next succeeding the last date on which
tenders or exchanges may be made pursuant to such tender or
exchange offer (the "Expiration Time"), the Exchange Rate will
be adjusted based on the following formula:
ER1 = ER0 x (AC + (SP1 x OS1))/(SP1 x OS0)
where
ER0 = the Exchange Rate in effect immediately prior
to the adjustment relating to such event
ER1 = the new Exchange Rate taking such event into
account
AC = the aggregate value of all cash and any
other consideration (as determined by the
Company's Board of Directors) paid or
payable
26
for Company Common Shares purchased in such
tender or exchange offer
OS0 = the number of Company Common Shares
outstanding immediately prior to the date
such tender or exchange offer expires
OS1 = the number of Company Common Shares
outstanding immediately after such tender
or exchange offer expires (after giving
effect to the purchase or exchange of
shares pursuant to such tender or exchange
offer)
SP1 = the average of the Closing Sale Prices
of Company Common Shares for the 10
consecutive Trading Days commencing on the
Trading Day next succeeding the date such
tender or exchange offer expires.
If the application of the foregoing formula would result
in a decrease in the Exchange Rate, no adjustment to the
Exchange Rate will be made.
Any adjustment to the Exchange Rate made pursuant to this
paragraph (e) shall become effective on the date immediately
following the Expiration Time. If the Company or one of its
subsidiaries is obligated to purchase Company Common Shares
pursuant to any such tender or exchange offer, but is
permanently prevented by applicable law from effecting any such
purchase or all such purchases are rescinded, the new Exchange
Rate shall be readjusted to be the Exchange Rate that would be in
effect if such tender or exchange offer had not been made.
(f) Notwithstanding the foregoing, in the event of an
adjustment to the Exchange Rate pursuant to paragraph (d) or
(e) above, in no event will the Exchange Rate exceed 30.7692,
subject to adjustment pursuant to paragraphs (a), (b) and (c)
above.
(g) If the Company has in effect a rights plan while any
Debentures remain Outstanding, Holders of Debentures will
receive, upon an exchange of Debentures in respect of which the
Operating Partnership elects to deliver Net Shares, in addition
to such Net Shares, rights under the Company's shareholder
rights agreement unless, prior to exchange, the rights have
expired, terminated or been redeemed or unless the rights have
separated from the Company Common Shares. If the rights
provided for in the rights plan adopted by the Company have
separated from the Company Common Shares in accordance with the
provisions of the applicable shareholder rights agreement so
that Holders of Debentures would not be entitled to receive any
rights in respect of Company Common Shares that the Operating
Partnership elects to deliver as Net Shares upon exchange of
Debentures, the Exchange Rate will be adjusted at the time of
separation as if the Company had distributed, to all holders of
Company Common Shares, capital stock, evidences of indebtedness
or other assets or property pursuant to paragraph (c) above,
subject to readjustment upon the subsequent expiration,
termination or redemption of the rights. In lieu of any such
27
adjustment, the Company may amend such applicable shareholder
rights agreement to provide that upon an exchange of Debentures
the Holders will receive, in addition to Company Common Shares
that the Operating Partnership elects to deliver as Net Shares
upon such exchange, the rights which would have attached to
such Company Common Shares if the rights had not become
separated from the Company Common Shares under such applicable
shareholder rights agreement. To the extent that the Company
adopts any future shareholder rights agreement, upon an
exchange of Debentures in respect of which the Operating
Partnership elects to deliver Company Common Shares as Net
Shares, a Holder of Debentures shall receive, in addition to
such Net Shares, the rights under the future shareholder
rights agreement whether or not the rights have separated from
Company Common Shares at the time of exchange and no adjustment
will be made in accordance with paragraph (c) or otherwise.
In addition to the adjustments pursuant to paragraphs (a)
through (g) above, the Operating Partnership may increase the
Exchange Rate in order to avoid or diminish any income tax to
holders of the Company Common Shares resulting from any
dividend or distribution of capital stock (or rights to acquire
Company Common Shares) or from any event treated as such for
income tax purposes. The Operating Partnership may also, from
time to time, to the extent permitted by applicable law,
increase the Exchange Rate by any amount for any period if the
Operating Partnership has determined that such increase would
be in the best interests of the Operating Partnership or the
Company. If the Operating Partnership makes such determination,
it will be conclusive and Operating Partnership will mail to
Holders of the Debentures a notice of the increased Exchange
Rate and the period during which it will be in effect at least
fifteen (15) days prior to the date the increased Exchange Rate
takes effect in accordance with applicable law.
If, in connection with any adjustment to the Exchange Rate
as set forth in this Section 4.14 a Holder shall be deemed for
U.S. federal tax purposes to have received a distribution or an
additional interest payment, the Operating Partnership may set
off any withholding tax it or the Company is required to
collect with respect to any such deemed distribution or payment
against cash payments of interest in accordance with the
provisions of Section 4.05 hereof or from cash and Company
Common Shares, if any, otherwise deliverable to a Holder upon
an exchange of Debentures in accordance with the provisions of
Section 4.12 hereof or a redemption or repurchase of a
Debenture in accordance with the provisions of Section 4.07,
4.08 or 4.09 hereof.
The Operating Partnership will not make any adjustment to
the Exchange Rate if Holders of the Debentures are permitted to
participate, on an as-exchanged basis, in the transactions
described above.
Notwithstanding anything to the contrary contained herein,
in addition to the other events set forth berein on account of
which no adjustment to the Exchange Rate shall be made, the
applicable Exchange Rate shall not be adjusted for:
(i) the issuance of any Company Common Shares pursuant to
any present or future plan providing for the
reinvestment of dividends or interest
28
payable on securities of the Operating Partnership or
those of the Company and the investment of additional
optional amounts in Company Common Shares under any
plan;
(ii) the issuance of any Company Common Shares or options
or rights to purchase those shares pursuant to any
present or future employee, trustee or consultant
benefit plan, employee agreement or arrangement or
program of the Operating Partnership or the Company;
(iii) the issuance of any Company Common Shares pursuant
to any option, warrant, right, or exercisable,
exchangeable or convertible security outstanding as
of the date the Debentures were first issued;
(iv) a change in the par value of Company Common Shares;
(v) accumulated and unpaid dividends or distributions;
(vi) as a result of a tender offer solely to holders of
less than 100 Company Common Shares; and
(vii) the issuance of limited partnership units by the
Operating Partnership and the issuance of Company
Common Shares or the payment of cash upon redemption
thereof.
No adjustment in the Exchange Rate will be required unless
the adjustment would require an increase or decrease of at
least 1% of the Exchange Price. If the adjustment is not made
because the adjustment does not change the Exchange Price by at
least 1%, then the adjustment that is not made will be carried
forward and taken into account in any future adjustment. All
required calculations will be made to the nearest cent or
1/1000th of a share, as the case may be. Notwithstanding the
foregoing, if the Debentures are called for redemption, all
adjustments not previously made will be made on the applicable
Redemption Date. Except as specifically described above, the
applicable Exchange Rate will not be subject to adjustment in
the case of the issuance of any Company Common Shares or
Company preferred shares, or securities exchangeable into or
exchangeable for Company Common Shares or Company preferred
shares.
Whenever the Exchange Rate is adjusted as herein provided,
the Company or the Operating Partnership shall as promptly as
reasonably practicable file with the Trustee and any Exchange
Agent other than the Trustee an Officers' Certificate setting
forth the Exchange Rate after such adjustment and setting forth
a brief statement of the facts requiring such adjustment.
Promptly after delivery of such certificate, the Company or the
Operating Partnership shall prepare a notice of such adjustment
of the Exchange Rate setting forth the adjusted Exchange Rate
and the date on which each adjustment becomes effective and
shall mail such notice of such adjustment of the Exchange Rate
to the Holders of the Debentures within 20 Business Days of the
Effective Date of such adjustment. Failure to deliver such
notice shall not affect the legality or validity of any such
adjustment.
29
For purposes of this Section 4.14, the number of Company
Common Shares at any time outstanding shall not include shares
held in the treasury of the Company but shall include shares
issuable in respect of scrip certificates issued in lieu of
fractions of Company Common Shares.
Notwithstanding anything in this Section 4.14 to the
contrary, in no event shall the Exchange Rate be adjusted so
that the Exchange Price would be less than $0.01.
Subject to the provisions of Section 4.10 pursuant to
which the Operating Partnership may elect to adjust the
Exchange Rate and the exchange right in connection with a
Public Acquirer Change in Control, if any of the following
events occur, namely (i) any reclassification or change of the
outstanding Company Common Shares (other than a subdivision or
combination to which Section 4.14(a) applies), (ii) any
consolidation, merger or combination of the Company with
another Person, or a binding share exchange in respect of all
of the outstanding Company Common Shares as a result of which
holders of Company Common Shares shall be entitled to receive
stock, other securities or other property or assets (including
cash) with respect to or in exchange for such Company Common
Shares or (iii) any sale or conveyance of all or substantially
all of the properties and assets of the Company to any other
Person as a result of which holders of Company Common Shares
shall be entitled to receive stock, other securities or other
property or assets (including cash) with respect to or in
exchange for such Company Common Shares, then the Company or
the successor or purchasing Person, as the case may be, shall
execute with the Trustee a supplemental indenture (which shall
comply with the Trust Indenture Act as in force at the date of
execution of such supplemental indenture) providing that each
Debenture, and the Exchange Value thereof, shall be
exchangeable based on the kind and amount of shares of stock,
other securities or other property or assets (including cash)
receivable upon such reclassification, change, consolidation,
merger, combination, sale or conveyance that the holder would
have received if the Holder had exchanged its Debentures
immediately prior to such reclassification, change,
consolidation, merger, combination, sale or conveyance assuming
such Holder did not exercise his rights of election, if any, as
to the kind or amount of stock, other securities or other
property or assets (including cash) receivable upon such
reclassification, change, consolidation, merger, combination,
sale or conveyance (provided that, if the kind or amount of
stock, other securities or other property or assets (including
cash) receivable upon such reclassification, change,
consolidation, merger, combination, sale or conveyance is not
the same for each share of Common Stock in respect of which
such rights of election shall not have been exercised (a
"non-electing share"), then for the purposes of this paragraph
the kind and amount of stock, other securities or other
property or assets (including cash) receivable upon such
reclassification, change, consolidation, merger, combination,
sale or conveyance for each non-electing share shall be deemed
to be the kind and amount so receivable per share by a
plurality of the non-electing shares). Such supplemental
indenture shall provide for adjustments which shall be as
nearly equivalent as may be practicable to the adjustments
provided for in this Section 4.14. The Company shall cause
notice of the execution of such supplemental indenture to be
mailed to each
30
Holder of Debentures within 20 Business Days after execution
thereof. Failure to deliver such notice shall not affect the
legality or validity of such supplemental indenture. The
provisions of this paragraph shall similarly apply to
successive reclassifications, changes, consolidations, mergers,
combinations, sales and conveyances. If the provisions of this
paragraph applies to any event or occurrence, then the
provisions of Sections 4.14(a) through (g) shall not apply.
Section 4.15. Ownership Limit; withholding. Notwithstanding any
other provision of the Debentures or the instructions contained
herein, no Holder of Debentures shall be entitled to exchange such
Debentures for Company Common Shares to the extent that receipt of
such shares would cause such Holder (together with such Holder's
affiliates) to exceed the ownership limit contained in the Articles
of Amendment and Restatement of the Company as in effect from time
to time.
At the Maturity of the principal of the Debentures, whether at
Stated Maturity or upon earlier redemption or repurchase of
Debentures or otherwise, and as otherwise required by law, the
Operating Partnership may deduct and withhold from the amount of
consideration otherwise deliverable to such Holder the amount
required to be deducted and withheld under applicable law.
Section 4.16. Merger, Consolidation or Sale. Sections 801 and
803 of the Indenture, for purposes of the Debentures, is hereby
modified to include, in addition to provisos (1), (2) and (3) in
such Sections, the following additional proviso:
"if as a result of such transaction the Debentures
become exchangeable into common stock or other securities
issued by a third party, such third party shall fully and
unconditionally guarantee all obligations under the Debentures
and the Indenture."
Section 4.17. Satisfaction and Discharge; Defeasance and
Covenant Defeasance. The provisions of Section 401 of the Indenture
is modified in respect of the Debentures to provide that the
Operating Partnership may not discharge a Holder's rights to
exchange Debentures in accordance with the terms of the Debentures
or to have registered the transfer or exchange of Debentures in
accordance with the terms of the Indenture.
The provisions of Section 402(2) and Section 402(3) of the
Indenture shall be applicable to the Debentures. Notwithstanding the
foregoing, the Debentures shall be deemed to be "Outstanding" for
all purposes relating to the obligations of the Operating
Partnership upon an exchange of Debentures by a Holder thereof.
Section 4.18. Events of Default. Section 501 of the Indenture
is modified for purposes of the Debentures to add the following
Event of Default:
"If the Operating Partnership fails to deliver cash or
Company Common Shares, or any combination thereof, when due
upon an exchange of Debentures, together with any cash due in
lieu of fractional shares, and that failure continues for 10
days."
31
Section 4.19. Modification. Section 902 of the Indenture is
modified for purposes of the Debentures to add, in addition to
clauses (1) through (4) thereunder, the following as requiring the
consent of each Holder of a Debenture for modification or waiver:
"modify the provisions with respect to the Holders'
rights upon a Change in Control in a manner adverse to Holders
of the Debentures, including the obligations of the Operating
Partnership to repurchase the Debentures following a Change in
Control;"
- and -
"adversely affect the Holders' rights contained in the
exchange or repurchase provisions of the Debentures."
Section 4.20. Full and Unconditional Guarantee by the Company.
The provisions of ARTICLE SIXTEEN of the Indenture shall be
applicable to the Debentures.
Section 4.21. Certain Covenants Not Applicable to the
Debentures. The Debentures shall not be entitled to the benefits of
the covenants set forth in Section 1005 and Section 1006 of the
Indenture.
Section 4.22. Calculations in Respect of the Debentures. Except
as otherwise specifically stated herein or in the Debentures, all
calculations to be made in respect of the Debentures shall be the
obligation of the Operating Partnership. All calculations made by
the Operating Partnership or its agent as contemplated pursuant to
the terms hereof and of the Debentures shall be made in good faith
and be final and binding on the Operating Partnership and the
Holders absent manifest error. The Operating Partnership shall
provide a schedule of calculations to the Trustee, and the Trustee
shall be entitled to rely upon the accuracy of the calculations by
the Operating Partnership without independent verification. The
Trustee shall forward calculations made by the Operating Partnership
to any Holder of Debentures upon request.
Section 4.23. Authorized Denominations. The Debentures shall be
issued in denominations of $1,000 and integral multiples thereof and
payments of principal, interest and additional amounts, if any, on
the Debentures shall be made in U.S. dollars.
Section 4.24. Exchange Agent, Paying Agent and Securities
Registrar. The Bank of New York is hereby appointed as Exchange
Agent, Paying Agent and the Security Registrar for the Debentures.
The Security Register for the Debentures will be maintained by the
Security Registrar in the Borough of Manhattan, The City of New
York. The rights, privileges, protections, immunities and benefits
given to the Trustee pursuant to the Indenture, including, without
limitation, its right to be indemnified, are extended to, and shall
be enforceable by, the Trustee in each of its capacities with
respect to the Debentures.
* * *
32
Each of the undersigned has read the conditions relating to the
authentication and delivery of the Securities contained in the Indenture and
the definitions therein relating thereto, has read the certified copy of the
Board Resolutions and has examined the form of the Securities attached
thereto. In the opinion of each of the undersigned, he has made such
examination or investigation as was necessary to enable him to express an
informed opinion as to whether or not such conditions have been complied with
and, in the opinion of each of the undersigned, such conditions have been
complied with. To the best of each of the undersigned's knowledge, no event
which is, or after notice or lapse of time would become, an Event of Default
with respect to the Securities has occurred and is continuing.
Insofar as this Certificate relates to legal matters, it is based, as
provided for in Section 103 of the Indenture, upon the Opinion of Counsel
contemporaneously delivered to the Trustee herewith and relating to the
Securities.
33
IN WITNESS WHEREOF, we have hereunto set our hands this 27th day of
June, 2005.
By: /s/ Jason M. Barnett
----------------------------------
Jason M. Barnett
Executive Vice President,
General Counsel and Secretary
By: /s/ Michael Maturo
----------------------------------
Michael Maturo
Executive Vice President,
Chief Financial Officer
and Treasurer
34
Annex A
[FORM OF DEBENTURE]
A-1
Exhibit 5
SIDLEY AUSTIN BROWN & WOOD LLP
BEIJING 787 SEVENTH AVENUE LOS ANGELES
------- NEW YORK, NEW YORK 10019 -------
BRUSSELS TELEPHONE 212 839 5300 NEW YORK
------- FACSIMILE 212 839 5599 -------
CHICAGO www.sidley.com SAN FRANCISCO
------- -------
DALLAS FOUNDED 1866 SHANGHAI
------- -------
GENEVA SINGAPORE
------- -------
HONG KONG TOKYO
------- -------
LONDON WASHINGTON, D.C.
June 27, 2005
Reckson Operating Partnership, L.P.
Reckson Associates Realty Corp.
225 Broadhollow Road
Melville, New York 11747
Ladies and Gentlemen:
This opinion is furnished in connection with the Registration Statement
on Form S-3 (File No. 333-115997) filed with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended
(the "Securities Act"), relating to the public offering of up to $287,500,000
aggregate principal amount of 4.00% Exchangeable Senior Debentures due 2025
(the "Debentures") by Reckson Operating Partnership, L.P., a Delaware limited
partnership (the "Operating Partnership"), on terms set forth in a prospectus
supplement dated June 21, 2005 to the prospectus dated July 13, 2004
(collectively, the "Prospectus"). The Debentures will be fully and
unconditionally guaranteed (the "Guarantee") as to the payment of principal
thereof and interest thereon by Reckson Associates Realty Corp., a Maryland
corporation and the general partner of the Operating Partnership (the
"Company"). The Debentures will be issued pursuant to an indenture dated as of
March 26, 1999 among the Operating Partnership, as issuer, the Company, as
guarantor, and The Bank of New York, as trustee, including the Officers'
Certificate establishing the terms of the Debentures (collectively, the
"Indenture").
In arriving at the opinions expressed below, we have examined such
documents and records as we deemed appropriate, including the following: the
Certificate of Limited Partnership and the Amended and Restated Agreement of
Limited Partnership, as amended, of the Operating Partnership, the Charter and
the Amended and Restated Bylaws, as amended, of the Company; records of
corporate proceedings of the Company; the Registration Statement; the
Indenture; the form of global note evidencing the Debentures; the Prospectus;
and such other certificates, receipts, records and documents as we considered
necessary for the purposes of this opinion.
Based upon the foregoing, and subject to the limitations, qualifications
and exceptions set forth herein, we are of the opinion that:
SIDLEY AUSTIN BROWN & WOOD LLP IS A DELAWARE LIMITED LIABILITY PARTNERSHIP
PRACTICING IN AFFILIATION WITH OTHER SIDLEY AUSTIN BROWN & WOOD PARTNERSHIPS
(i) The Debentures have been duly authorized by all necessary partnership
action of the Operating Partnership and, when the Debentures have been duly
executed, authenticated and delivered against consideration therefor as
contemplated in the Indenture and the Prospectus, the Debentures will
constitute valid and legally binding obligations of the Operating Partnership
and registered holders of the Debentures will be entitled to the benefits of
the Indenture; provided, however, that the foregoing opinion is subject, as to
enforcement against the Operating Partnership, to bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
enforcement of creditors' rights generally and to general principles of equity
(regardless of whether enforcement is considered in a proceeding in equity or
at law).
(ii) The Guarantee has been duly authorized by all necessary corporate
action of the Company and, when the Debentures are executed, authenticated,
issued and delivered as contemplated in the Indenture and the Prospectus, the
Guarantee will constitute a valid and legally binding obligation of the
Company; provided, however, that the foregoing opinion is subject, as to
enforcement against the Company, to bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the enforcement of
creditors' rights generally and to general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law).
(iii) The shares of common stock, par value $0.01 per share, of the
Company (the "Common Stock") that are issuable upon an exchange of the
Debentures under certain circumstances (the "Underlying Shares") have been
duly authorized and reserved for issuance by the Company. The Underlying
Shares, if and when issued and delivered by the Company upon an exchange in
accordance with the Debentures and the Indenture, will be validly issued,
fully paid and non-assessable shares of Common Stock.
This letter is limited to matters arising under the federal laws of the
United States of America, the laws of the State of New York, the Delaware
Revised Uniform Limited Partnership Act and the Maryland General Corporation
Law and we express no opinion or other statement as to the laws of any other
jurisdiction or as to the municipal laws, or the laws, rules or regulations of
any local agencies, of or within the State of New York, the State of Delaware
or the State of Maryland.
We hereby consent to the filing of this opinion as an exhibit to the
Current Report of the Company and the Operating Partnership on Form 8-K dated
June 27, 2005 and to the references to our firm in the Prospectus under the
caption "Legal Matters."
Very truly yours,
/s/ Sidley Austin Brown & Wood LLP
2
Exhibit 10.1
AMENDMENT NO. 2 TO THIRD
------------------------
AMENDED AND RESTATED CREDIT AGREEMENT
-------------------------------------
This AMENDMENT NO. 2 TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT (this
"Amendment No. 2") is made as of June 20, 2005 by and among (a) Reckson
Operating Partnership, L.P. (the "Borrower"), (b) the Lenders party hereto,
and (c) JPMorgan Chase Bank, N.A. (f/k/a JPMorgan Chase Bank) as
Administrative Agent (in such capacity, the "Administrative Agent") for the
Lenders.
WHEREAS, the Borrower, the Lenders and the Administrative Agent are
parties to a Third Amended and Restated Credit Agreement dated as of August 6,
2004, as amended by Amendment No. 1 to Third Amended and Restated Credit
Agreement, dated as of May 11, 2005 (as so amended, the "Credit Agreement"),
pursuant to which the Lenders have agreed to make loans to the Borrower on the
terms and conditions set forth therein; and
WHEREAS, the Borrower has requested that the Lenders amend certain
provisions of the Credit Agreement, and the Lenders party hereto are willing
to so amend certain provisions of the Credit Agreement on the terms and
conditions set forth herein;
NOW, THEREFORE, in consideration of the foregoing premises, and for other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and fully intending to be legally bound by this Amendment
No. 2, the parties hereto agree as follows:
1. Definitions. Capitalized terms used herein without definition shall
have the meanings assigned to such terms in the Credit Agreement.
2. Amendments to Credit Agreement. As of the Effective Date (as defined
in ss.4 hereof) the Credit Agreement is amended as follows:
2.1. Amendments to Section 1.1. Section 1.1. is hereby amended as
follows:
2.1.1. The definition of the term "Adjusted Unencumbered NOI"
is hereby amended by restating the proviso at the end of such
definition to read as follows:
"provided, clause (ii) above shall not exceed twenty percent
(20%) of Adjusted Unencumbered NOI; clause (iii) above shall not
exceed ten percent (10%) of Adjusted Unencumbered NOI; and clause
-2-
(iv) above shall not exceed fifteen percent (15%) of Adjusted
Unencumbered NOI."
2.1.2. The definition of the term "Applicable Margin" is hereby
amended by deleting the table set forth therein in its entirety and
substituting the following table in place thereof:
Range of Applicable Applicable
the Borrower's Margin for Euro Margin for
Credit Rating Dollar Loans Base Rate
(S&P/Moody's (% per annum) Loans
or other Ratings) ------------- (% per annum)
----------------- -------------
A-/A3 or their equivalent or 0.50 0
higher
BBB+/Baa1 or their equivalent 0.525 0
BBB/Baa2 or their equivalent 0.60 0
BBB-/Baa3 or their equivalent 0.80 0
Below BBB-/Baa3 or their 1.10 0
equivalent or unrated
2.1.3. The definition of the term "Base Rate Loan" is hereby
amended by inserting the words "or a Swingline Loan" at the end of
clause (i) of such definition after the words "Section 5.1(a)".
2.1.4. The definition of the term "Capital Expenditure Coverage
Reserve Amounts" is hereby amended by inserting the words ";
provided that all properties that are subject to a Triple Net Lease
shall be excluded from the foregoing calculation of the Capital
Expenditure Coverage Reserve Amounts" at the end of such definition
after the word "Assets".
2.1.5. The definition of the term "Capital Expenditure
Valuation Reserve Amounts" is hereby amended by inserting the words
"; provided that all properties that are subject to a Triple Net
Lease shall be excluded from the foregoing calculation of the
Capital Expenditure Valuation Reserve Amounts" at the end of such
definition after the word "Assets".
-3-
2.1.6. The definition of the term "Indebtedness" is hereby
amended by inserting the words ", other than any undrawn letter of
credit to the extent that such letter of credit supports any
Contractual Obligation with a term of less than ninety (90) days,"
at the end of clause (a)(iii) of such definition.
2.1.7. The definition of the term "Lender" is hereby amended by
inserting the following sentence at the end of such definition:
"Unless the context otherwise requires, the term "Lenders"
includes the Swingline Lender."
2.1.8. The definition of the term "Loans" is hereby amended and
restated in its entirety as follows:
""Loans" means Committed Loans, Competitive Bid Loans and
Swingline Loans."
2.1.9. The definition of the term "New York City Asset" is
hereby amended and restated in its entirety as follows:
""New York City Asset" means (i) Real Property which is Class A
office property located in the borough of Manhattan, New York, New
York or (ii) Real Property which is Class A office property located
in any other borough of New York, New York and is substantially
similar to Class A office properties located in the borough of
Manhattan, New York, New York, and in each case which is owned or
ground-leased by one of the Consolidated Businesses or Joint
Ventures."
2.1.10. The definition of the term "Note" is hereby amended and
restated in its entirety as follows:
""Note" means any of the Borrower Notes, the Designated Lender
Notes and any promissory notes issued to the Swingline Lender;
"Notes" means, collectively, all of such Notes outstanding at any
given time."
2.1.11. The definition of the term "Revolving Credit
Commitment" is hereby amended by inserting the words "and Swingline
Loans" after the words "Letters of Credit" in the second line of
such definition.
2.1.12. The definition of the term "Revolving Credit
Obligations" is hereby amended by inserting the words ", plus (iv)
the
-4-
outstanding principal amount of the Swingline Loans at such time" at
the end of such definition immediately after the word "time".
2.1.13. The definition of the term "Revolving Credit
Termination Date" is hereby amended by deleting the date "August 6,
2007" in the first line of such definition and replacing it with the
date "August 6, 2008".
2.1.14. The definition of the term "Total Unencumbered Value"
is hereby amended by restating the second sentence of the second
paragraph of such definition to read as follows:
"Clause (iii) shall not exceed ten percent (10%) of Total
Unencumbered Value."
2.1.15. The definition of the term "Total Value" is hereby
amended and restated in its entirety as follows:
""Total Value" means (a) the sum of (i) Valuation NOI divided
by (A) seven and one-half percent (7.50%) for all New York City
Assets, (B) eight and three-quarter percent (8.75%) for all other
office Real Property, and (C) nine percent (9.00%) for industrial
Real Property; (ii) the Investment in office and industrial Projects
owned or ground-leased by the Consolidated Businesses for less than
four fiscal quarters; (iii) unrestricted Cash and Cash Equivalents;
(iv) land cost (at book value) and Construction Asset Cost, which
credit will be limited to fifteen percent (15%) of Total Value
(exclusive of build-to-suit Projects that are seventy-five percent
(75%) pre-leased or Projects which are less than seventy-five
percent (75%) pre-leased but have a pro-forma yield of ten percent
(10%) or more, based upon executed leases and the cost of
acquisition plus the estimated cost to complete the same, which
estimated cost to complete shall be determined in a manner
reasonably acceptable to the Administrative Agent and the
Syndication Agent); (v) NOI from all other Real Property not
otherwise set forth in this definition, divided by twelve percent
(12%); (vi) Servicing EBITDA of the Management Company or other such
service companies for the immediately preceding four (4) consecutive
quarters, divided by twenty percent (20%); (vii) any investment in
or loan to (based on the actual cash investment in or loan to),
directly or indirectly, an affiliated or unaffiliated operating
company and investments in or loans to Investment Funds either
directly or indirectly or joint venture arrangements with Investment
Funds, which credit will be limited to $100,000,000 (valued at the
lower of cost or market in accordance with GAAP), other than (x)
investments in, loans to, or joint venture arrangements with Joint
Ventures and (y)
-5-
Performing Notes; (viii) Performing Notes, which credit will be
limited in the aggregate to fifteen percent (15%) of Total Value;
and (ix) Eligible Cash 1031 Proceeds;
less (b) the quotient of the Capital Expenditure Valuation
Reserve Amounts for such period, divided by (A) seven and one-half
percent (7.50%) for all New York City Assets, (B) eight and
three-quarter percent (8.75%) for all other office Property, and (C)
nine percent (9.00%) for industrial Property;
provided, the sum of items (a) (iv), (vii) and (viii) above
shall not exceed twenty-five percent (25%) of Total Value."
2.1.16. The following new definitions shall be inserted in
Section 1.1. in proper alphabetical order:
""Swingline Lender" means JPMorgan Chase Bank in its capacity
as the lender of Swingline Loans hereunder, and its successors in
such capacity."
""Swingline Loan" means a Loan made pursuant to Section 2.7."
""Triple Net Lease" means a Lease representing all or
substantially all of the rentable area of a Property where the
tenant is responsible for real estate taxes and assessments, repairs
and maintenance, insurance and other expenses relating to such
Property provided, that adequate insurance is maintained for such
Property either by the tenant, the Borrower, the Company, a
Subsidiary or a Joint Venture."
2.2. Amendments to Section 2.1. Section 2.1. is hereby amended as
follows:
2.2.1. Subsection 2.1(a) is hereby amended by inserting the
following sentence after the last sentence of Subsection 2.1.(a):
"Each Swingline Loan shall be in an amount that is not less
than $5,000,000."
2.2.2. Subsection 2.1(c) is hereby amended by deleting the word
"and" immediately before Subsection 2.1(c)(y) in the fourth line
thereof and replacing it with a comma. Subsection 2.1(c) is hereby
further amended by inserting the words "and (z) no later than 2:00
p.m. (New York time) in the case of a Borrowing of Swingline Loans,
as
-6-
provided in Section 2.7(b)" immediately after the first reference to
"Eurodollar Rate Loans" in the sixth line thereof.
2.2.3. Subsection 2.1(d) is hereby amended by inserting the
words "(or 1:00 p.m. in the case of participations in Swingline
Loans)" after the words "12:00 noon" in the eighth line thereof.
Subsection 2.1(d) is hereby further amended by inserting the words
", provided that Swingline Loans shall be made as provided in
Section 2.7" at the end of the second sentence of such subsection.
2.3. Section 2.7. A new Section 2.7 shall be inserted immediately
after Section 2.6 and shall read as follows:
"2.7. Swingline Loans. (a) Subject to the terms and conditions set
forth herein, the Swingline Lender agrees to make Swingline Loans to the
Borrower from time to time during the Revolving Credit Period, in an
aggregate principal amount at any time outstanding that will not result
in (i) the aggregate principal amount of outstanding Swingline Loans
exceeding $50,000,000 or (ii) the Revolving Credit Obligations exceeding
the Maximum Revolving Credit Amount; provided that the Swingline Lender
shall not be required to make a Swingline Loan to refinance an
outstanding Swingline Loan. Within the foregoing limits and subject to
the terms and conditions set forth herein, the Borrower may borrow,
prepay and reborrow Swingline Loans.
(b) To request a Swingline Loan, the Borrower shall notify the
Administrative Agent of such request by telephone (confirmed by
telecopy), not later than 2:00 p.m., New York City time, on the day of a
proposed Swingline Loan. Each such notice shall be irrevocable and shall
specify the requested date (which shall be a Business Day and may be the
same day as the request) and amount of the requested Swingline Loan. The
Administrative Agent will promptly advise the Swingline Lender of any
such notice received from the Borrower. The Swingline Lender shall make
each Swingline Loan available to the Borrower by means of a credit to the
general deposit account of the Borrower with the Swingline Lender by 3:00
p.m., New York City time, on the requested date of such Swingline Loan.
(c) The Swingline Lender may by written notice given to the
Administrative Agent not later than 10:00 a.m., New York City time, on
any Business Day require the Lenders to acquire participations on such
Business Day in all or a portion of the Swingline Loans outstanding and
unpaid in accordance with Section 14.1(e). Such notice shall specify the
aggregate amount of Swingline Loans in which Lenders will participate.
Promptly upon receipt of such notice, the Administrative Agent will give
notice thereof to each Lender, specifying in such notice such Lender's
Pro Rata Share of such Swingline Loan or Loans. Each Lender hereby
absolutely and unconditionally agrees, upon receipt of notice as provided
above, to pay to the Administrative Agent, for the account of the
Swingline Lender, such Lender's Pro Rata Share of such
-7-
Swingline Loan or Loans. Each Lender acknowledges and agrees that its
obligation to acquire participations in Swingline Loans pursuant to this
paragraph is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including the occurrence and continuance of an
Event of Default or reduction or termination of the Revolving Credit
Commitments, and that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever. Each Lender shall comply
with its obligation under this paragraph by wire transfer of immediately
available funds, in the same manner as provided in Section 2.1(d) with
respect to Loans made by such Lender (and Section 2.1(d) shall apply,
mutatis mutandis, to the payment obligations of the Lenders), and the
Administrative Agent shall promptly pay to the Swingline Lender the
amounts so received by it from the Lenders. The Administrative Agent
shall notify the Borrower of any participations in any Swingline Loan
acquired pursuant to this paragraph, and thereafter payments in respect
of such Swingline Loan shall be made to the Administrative Agent and not
to the Swingline Lender. Any amounts received by the Swingline Lender
from the Borrower (or other party on behalf of the Borrower) in respect
of a Swingline Loan after receipt by the Swingline Lender of the proceeds
of a sale of participations therein shall be promptly remitted to the
Administrative Agent; any such amounts received by the Administrative
Agent shall be promptly remitted by the Administrative Agent to the
Lenders that shall have made their payments pursuant to this paragraph
and to the Swingline Lender, as their interests may appear; provided that
any such payment so remitted shall be repaid to the Swingline Lender or
to the Administrative Agent, as applicable, if and to the extent such
payment is required to be refunded to the Borrower for any reason. The
purchase of participations in a Swingline Loan pursuant to this paragraph
shall not relieve the Borrower of any default by the Borrower in the
payment thereof."
2.4. Amendment to Section 4.1. Section 4.1(a) is hereby amended by
inserting the following sentence immediately before the last sentence of
such Section 4.1(a):
"Swingline Loans may be prepaid provided that the Borrower notifies
the Swingline Lender of such prepayment no later than 12:00 p.m. (New
York time) on the date of such prepayment."
2.5. Amendment to Section 4.3. Section 4.3(a) is hereby amended by
inserting the following sentence immediately after the first sentence of
such Section 4.3(a):
-8-
"The Borrower hereby promises to pay to the Swingline Lender the
then unpaid principal amount of each Swingline Loan on or before the
earliest of (1) the Revolving Credit Termination Date, (2) the fifth
Business Day after such Swingline Loan is made, (3) the last day of any
calendar quarter, and (4) each date that another Borrowing (other than a
Swingline Borrowing) is made."
2.6. Amendments to Section 5.1.
2.6.1. Section 5.1(a) is hereby further amended by inserting
the following sentence immediately before the last sentence of such
Section 5.1(a):
"Each Swingline Loan shall be a Base Rate Loan."
2.6.2. Section 5.1(b) is hereby amended by inserting the words
"(other than a Swingline Loan)" after the phrase "Interest accrued
on each Loan" in the first line of such Section 5.1(b). Section
5.1(b) is hereby further amended by inserting the following sentence
at the end of such Section 5.1(b):
"Interest accrued on each Swingline Loan shall be calculated
and payable in arrears on the date that such Loan is required to be
repaid."
2.6.3. Section 5.1(c) is hereby amended by inserting the
following sentence immediately after the last sentence of such
Section 5.1(c)(i):
"This Section 5.1(c) shall not apply to Swingline Loans, which
may not be converted or continued."
2.7. Amendment to Section 9.5. Section 9.5 is hereby amended and
restated in its entirety to read as follows:
"9.5. Insurance. The Borrower shall maintain for itself and its
Subsidiaries, or shall cause each of its Subsidiaries or tenants to
maintain, in full force and effect the insurance policies and programs
listed on Schedule 7.1-T or substantially similar policies and programs
or other policies and programs as are reasonably acceptable to the
Administrative Agent. All such policies and programs shall be maintained
(a) with insurers having an Alfred M. Best Company, Inc. rating of "A" or
better (or if approved by the Administrative Agent, a rating of "A-") and
a financial size category of not less than VIII or (b) in the case of (i)
insurance maintained by tenants, pursuant to insurance programs,
including self-insurance, supported by creditworthy entities which do not
satisfy clause (a) above or (ii) a program by
-9-
which a tenant (or any guarantor of tenant) undertakes obligations that
are substantially the same as would be covered by the insurance referred
to in this Section, by a tenant (or any guarantor) that is a creditworthy
entity, in each case consistent with normal industry practice and
reasonably acceptable to the Administrative Agent; provided that a tenant
(or any guarantor) that is, or has senior unsecured long term debt that
is, rated at least "A" (or its equivalent) by any Rating Agency shall be
deemed to have acceptable creditworthiness by the Administrative Agent."
2.8. Amendments to Section 10.11.
2.8.1. Section 10.11(a) is hereby amended by restating such
Section 10.11(a) in its entirety to read as follows:
"(a) Indebtedness. Neither the Borrower nor any of its
Subsidiaries shall directly or indirectly create, incur, assume or
otherwise become or remain directly or indirectly liable with
respect to ("Incur") any Indebtedness, except:
(i) Total Outstanding Indebtedness which would not exceed
sixty percent (60%) of Total Value as of the date of
incurrence; provided that if the Borrower or its Subsidiaries
shall have Incurred any Indebtedness in connection with the
acquisition of any material Real Property during the previous
120 days, the Borrower or its Subsidiaries may Incur
Indebtedness (the "Incurrence") that would cause Total
Outstanding Indebtedness to exceed sixty percent (60%) of Total
Value so long as (x) Total Outstanding Indebtedness does not
exceed sixty-five percent (65%) of Total Value and (y) Total
Outstanding Indebtedness is reduced to sixty percent (60%) or
less of Total Value within 240 days after the date of the
Incurrence (with such reduction to be certified in writing to
the Administrative Agent by the Borrower);
(ii) Total Secured Outstanding Indebtedness which would
not exceed forty percent (40%) of Total Value as of the date of
incurrence, or
(iii) Total Recourse Secured Outstanding Indebtedness
which would not exceed ten percent (10%) of Total Value as of
the date of incurrence."
2.8.2. Section 10.11(b) is hereby amended by deleting the words
"the date hereof" at the end of such Section 10.11(b) and replacing
such words with the date "June 20, 2005".
-10-
2.9. Amendment to Section 12.5. Section 12.5 is hereby amended by
restating such Section 12.5 in its entirety to read as follows:
"12.5. Indemnification. To the extent that the Administrative Agent,
a Documentation Agent, a Co-Agent, the Syndication Agent, the Swingline
Lender or the Issuing Bank or any Arranger is not reimbursed and
indemnified by the Borrower, the Lenders will reimburse and indemnify
such Agent, the Swingline Lender or the Issuing Bank for and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, and reasonable costs, expenses or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by, or
asserted against it in any way relating to or arising out of the Loan
Documents or any action taken or omitted by such Agent, the Swingline
Lender or the Issuing Bank under the Loan Documents, in proportion to
each Lender's Pro Rata Share. Notwithstanding anything to the contrary
contained herein, the Administrative Agent, a Documentation Agent, a
Co-Agent, the Syndication Agent, the Swingline Lender, the Issuing Bank
or any Arranger shall not be indemnified to the extent such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs
and expenses result from such Person's gross negligence, willful
misconduct or breach of this Article XII. Such Agent, the Swingline
Lender or the Issuing Bank agrees to refund to the Lenders any of the
foregoing amounts paid to it by the Lenders which amounts are
subsequently recovered by such Agent, the Swingline Lender or the Issuing
Bank from the Borrower or any other Person on behalf of the Borrower. The
obligations of the Lenders under this Section 12.5 shall survive the
payment in full of the Loans, the Reimbursement Obligations and all other
Obligations and the termination of this Agreement."
2.10. Amendment to Section 14.1(e). Section 14.1(e) is hereby
amended by inserting the words "and Swingline Loans" immediately after
the words "Committed Loans" in the fourth line of such Section 14.1(e).
Section 14.1(e) is hereby further amended by inserting the words "and
Swingline Loans" immediately after the words "Letters of Credit" in the
fifth line of such Section 14.1(e).
2.11. Amendment to Section 14.7(d). Section 14.7(d) is hereby
amended by inserting the words ", the Issuing Bank or the Swingline
Lender" after the words "the Administrative Agent" in the sixth line of
such Section 14.7(d). Section 14.7(d) is hereby further amended by
inserting the words ", the Issuing Bank or the Swingline Lender, as the
case may be," after the words "the Administrative Agent" in the seventh
line of such Section 14.7(d).
2.12. Amendment to Schedules. Schedule LC is hereby amended by
adding the words "& SWINGLINE LENDER" immediately after the words
"ADMINISTRATIVE AGENT" in the title of Section I.
-11-
3. Provisions Of General Application.
---------------------------------
3.1. Representations and Warranties. The Borrower hereby represents
and warrants as of the date hereof that (a) each of the representations
and warranties of the Borrower contained in the Credit Agreement, the
other Loan Documents or in any document or instrument delivered pursuant
to or in connection with the Credit Agreement or this Amendment No. 2 are
true and correct in all material respects as of the date as of which they
were made and are true and correct in all material respects at and as of
the date of this Amendment No. 2 (except to the extent that such
representations and warranties expressly speak as of a different date),
(b) no Potential Event of Default or Event of Default exists on the date
hereof, and (c) this Amendment No. 2 has been duly authorized, executed
and delivered by the Borrower and is in full force and effect as of the
Effective Date, and the agreements and obligations of the Borrower
contained herein constitute the legal, valid and binding obligations of
the Borrower, enforceable against it in accordance with its terms, except
to the extent that the enforcement hereof or the availability of
equitable remedies may be limited by applicable bankruptcy,
reorganization, insolvency, moratorium, fraudulent transfer, fraudulent
conveyance or similar laws now or hereafter in effect relating to or
affecting creditors' rights generally or by general principles of equity,
or by the discretion of any court in awarding equitable remedies,
regardless of whether such enforcement is considered in a preceding in
equity or at law.
3.2. No Other Changes. Except as otherwise expressly provided or
contemplated by this Amendment No. 2, all of the terms, conditions and
provisions of the Credit Agreement remain unaltered and in full force and
effect. The Credit Agreement and this Amendment No. 2 shall be read and
construed as one agreement. The making of the amendments in this
Amendment No. 2 does not imply any obligation or agreement by the
Administrative Agent or any Lender to make any other amendment, waiver,
modification or consent as to any matter on any subsequent occasion.
3.3. Governing Law. This Amendment No. 2 shall be deemed to be a
contract under the laws of the State of New York. This Amendment No. 2
and the rights and obligations of each of the parties hereto are
contracts under the laws of the State of New York and shall for all
purposes be construed in accordance with and governed by the laws of such
State (excluding the laws applicable to conflicts or choice of law).
3.4. Assignment. This Amendment No. 2 shall be binding upon and
inure to the benefit of each of the parties hereto and their respective
permitted successors and assigns.
-12-
3.5. Counterparts. This Amendment No. 2 may be executed in any
number of counterparts, but all such counterparts shall together
constitute but one and the same agreement. In making proof of this
Amendment No. 2, it shall not be necessary to produce or account for more
than one counterpart thereof signed by each of the parties hereto.
4. Effectiveness of this Amendment No. 2. This Amendment No. 2 shall
become effective on the date on which the following conditions precedent are
satisfied (such date being hereinafter referred to as the "Effective Date"):
(a) Execution and delivery to the Administrative Agent by each of
the Lenders, the Borrower, the Guarantors and the Administrative Agent of
this Amendment No. 2.
(b) Execution and delivery to the Administrative Agent of (i) a
certificate of the Borrower confirming that there have been no changes to
its charter documents since May 11, 2005, or (ii) if there have been
changes to the Borrower's charter document since such date, a secretary's
certificate of the Borrower certifying as to such changes.
(c) Delivery to the Administrative Agent of an incumbency
certificate of the Borrower and of resolutions of the board of directors
of the general partner of the Borrower authorizing this Amendment No. 2.
(d) Payment to the Administrative Agent, for the accounts of the
Agents and the Lenders, as applicable, all fees due and payable on or
before the Effective Date and all expenses due and payable on or before
the Effective Date, including, without limitation, reasonable attorneys'
fees and expenses and other costs and expenses incurred in connection
with this Amendment No. 2.
(e) Delivery to the Administrative Agent by Fried Frank Harris
Shriver & Jacobson LLP, as counsel to the Borrower, of an opinion
addressed to the Lenders and the Administrative Agent in form and
substance reasonably satisfactory to the Administrative Agent.
[Remainder of page left blank intentionally]
IN WITNESS WHEREOF, the undersigned have duly executed and delivered this
Amendment No. 2 as of the date first set forth above.
RECKSON OPERATING PARTNERSHIP, L.P.
By: Reckson Associates Realty Corp.,
its general partner
By: /s/ Michael Maturo
----------------------------
Name: Michael Maturo
Title: Chief Financial Officer
JPMORGAN CHASE BANK, N.A.,
individually and as Issuing Bank,
Swingline Lender and Administrative
Agent
By:/s/ Marc E. Costantino
-----------------------------------
Name: Marc E. Costantino
Title: Vice President
CITICORP NORTH AMERICA, INC.
By: /s/ Joanne M. Craig
---------------------------------
Name: Joanne M. Craig
Title: Vice President
[Remainder of Signature Pages Intentionally Omitted]
Exhibit 10.2
AMENDMENT NO. 1 TO TERM LOAN AGREEMENT
--------------------------------------
This AMENDMENT NO. 1 TO TERM LOAN AGREEMENT (this "Amendment No. 1") is
made as of June 20, 2005 by and among (a) Reckson Operating Partnership, L.P.
(the "Borrower"), (b) the Lenders party hereto, and (c) Citicorp North
America, Inc., as Administrative Agent (in such capacity, the "Administrative
Agent") for the Lenders.
WHEREAS, the Borrower, the Lenders and the Administrative Agent are
parties to a Term Loan Agreement dated as of May 12, 2005 (the "Term Loan
Agreement"), pursuant to which the Lenders agreed to make a loan to the
Borrower on the terms and conditions set forth therein;
WHEREAS, the Borrower has requested that the Lenders amend certain
provisions of the Term Loan Agreement, and the Lenders party hereto are
willing to so amend certain provisions of the Term Loan Agreement on the terms
and conditions set forth herein;
NOW, THEREFORE, in consideration of the foregoing premises, and for
other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, and fully intending to be legally bound by this
Amendment No. 1, the parties hereto agree as follows:
1. Definitions. Capitalized terms used herein without definition shall
have the meanings assigned to such terms in the Term Loan Agreement.
2. Amendments to Term Loan Agreement. As of the Effective Date (as
defined in ss.4 hereof) the Term Loan Agreement is amended as follows:
2.1. Amendments to Section 1.1. Section 1.1. is hereby amended as
follows:
2.1.1. The definition of the term "Adjusted Unencumbered NOI"
is hereby amended by restating the proviso at the end of such
definition to read as follows:
"provided, clause (ii) above shall not exceed twenty percent
(20%) of Adjusted Unencumbered NOI; clause (iii) above shall not
exceed ten percent (10%) of Adjusted Unencumbered NOI; and clause
(iv) above shall not exceed fifteen percent (15%) of Adjusted
Unencumbered NOI."
-2-
2.1.2. The definition of the term "Applicable Margin" is
hereby amended by deleting the table set forth therein in its
entirety and substituting the following table in place thereof:
Range of Applicable
the Borrower's Applicable Margin for
Credit Rating Margin for Euro Base Rate
(S&P/Moody's Dollar Loans Loans
or other Ratings) (% per annum) (% per annum)
------------------------------ ----------------- -------------
A-/A3 or their equivalent or 0.50 0
higher
BBB+/Baa1 or their equivalent 0.525 0
BBB/Baa2 or their equivalent 0.60 0
BBB-/Baa3 or their equivalent 0.80 0
Below BBB-/Baa3 or their 1.10 0
equivalent or unrated
2.1.3. The definition of the term "Capital Expenditure
Coverage Reserve Amounts" is hereby amended by inserting the words
"; provided that all properties that are subject to a Triple Net
Lease shall be excluded from the foregoing calculation of the
Capital Expenditure Coverage Reserve Amounts" at the end of such
definition after the word "Assets".
2.1.4. The definition of the term "Capital Expenditure
Valuation Reserve Amounts" is hereby amended by inserting the words
"; provided that all properties that are subject to a Triple Net
Lease shall be excluded from the foregoing calculation of the
Capital Expenditure Valuation Reserve Amounts" at the end of such
definition after the word "Assets".
2.1.5. The definition of the term "Indebtedness" is hereby
amended by inserting the words ", other than any undrawn letter of
credit to the extent that such letter of credit supports any
Contractual Obligation with a term of less than ninety (90) days,"
at the end of clause (a)(iii) of such definition.
-3-
2.1.6. The definition of the term "New York City Asset" is
hereby amended and restated in its entirety as follows:
""New York City Asset" means (i) Real Property which is Class
A office property located in the borough of Manhattan, New York,
New York or (ii) Real Property which is Class A office property
located in any other borough of New York, New York and is
substantially similar to Class A office properties located in the
borough of Manhattan, New York, New York, and in each case which is
owned or ground-leased by one of the Consolidated Businesses or
Joint Ventures."
2.1.7. The definition of the term "Total Unencumbered Value"
is hereby amended by restating the second sentence of the second
paragraph of such definition to read as follows:
"Clause (iii) shall not exceed ten percent (10%) of Total
Unencumbered Value."
2.1.8. The definition of the term "Total Value" is hereby
amended and restated in its entirety as follows:
""Total Value" means (a) the sum of (i) Valuation NOI divided
by (A) seven and one-half percent (7.50%) for all New York City
Assets, (B) eight and three-quarter percent (8.75%) for all other
office Real Property, and (C) nine percent (9.00%) for industrial
Real Property; (ii) the Investment in office and industrial
Projects owned or ground-leased by the Consolidated Businesses for
less than four fiscal quarters; (iii) unrestricted Cash and Cash
Equivalents; (iv) land cost (at book value) and Construction Asset
Cost, which credit will be limited to fifteen percent (15%) of
Total Value (exclusive of build-to-suit Projects that are
seventy-five percent (75%) pre-leased or Projects which are less
than seventy-five percent (75%) pre-leased but have a pro-forma
yield of ten percent (10%) or more, based upon executed leases and
the cost of acquisition plus the estimated cost to complete the
same, which estimated cost to complete shall be determined in a
manner reasonably acceptable to the Administrative Agent and the
Syndication Agent); (v) NOI from all other Real Property not
otherwise set forth in this definition, divided by twelve percent
(12%); (vi) Servicing EBITDA of the Management Company or other
such service companies for the immediately preceding four (4)
consecutive quarters, divided by twenty percent (20%); (vii) any
investment in or loan to (based on the actual cash investment in or
loan to), directly or indirectly, an affiliated or unaffiliated
operating company and investments in or loans to Investment Funds
either directly or
-4-
indirectly or joint venture arrangements with Investment Funds,
which credit will be limited to $100,000,000 (valued at the lower
of cost or market in accordance with GAAP), other than (x)
investments in, loans to, or joint venture arrangements with Joint
Ventures and (y) Performing Notes; (viii) Performing Notes, which
credit will be limited in the aggregate to fifteen percent (15%) of
Total Value; and (ix) Eligible Cash 1031 Proceeds;
less (b) the quotient of the Capital Expenditure Valuation
Reserve Amounts for such period, divided by (A) seven and one-half
percent (7.50%) for all New York City Assets, (B) eight and
three-quarter percent (8.75%) for all other office Property, and
(C) nine percent (9.00%) for industrial Property;
provided, the sum of items (a) (iv), (vii) and (viii) above
shall not exceed twenty-five percent (25%) of Total Value."
2.1.9. The following new definitions shall be inserted in
Section 1.1. in proper alphabetical order:
""Triple Net Lease" means a Lease representing all or
substantially all of the rentable area of a Property where the
tenant is responsible for real estate taxes and assessments,
repairs and maintenance, insurance and other expenses relating to
such Property provided, that adequate insurance is maintained for
such Property either by the tenant, the Borrower, the Company, a
Subsidiary or a Joint Venture."
2.2. Amendments to Section 10.11.
---------------------------------
2.2.1. Section 10.11(a) is hereby amended by restating such
Section 10.11(a) in its entirety to read as follows:
"(a) Indebtedness. Neither the Borrower nor any of its
Subsidiaries shall directly or indirectly create, incur, assume or
otherwise become or remain directly or indirectly liable with
respect to ("Incur") any Indebtedness, except:
(i) Total Outstanding Indebtedness which would not exceed
sixty percent (60%) of Total Value as of the date of
incurrence; provided that if the Borrower or its Subsidiaries
shall have Incurred any Indebtedness in connection with the
acquisition of any material Real Property during the previous
120 days, the Borrower or its Subsidiaries may Incur
Indebtedness (the "Incurrence") that would cause Total
Outstanding Indebtedness to exceed sixty percent (60%) of
-5-
Total Value so long as (x) Total Outstanding Indebtedness does
not exceed sixty-five percent (65%) of Total Value and (y)
Total Outstanding Indebtedness is reduced to sixty percent
(60%) or less of Total Value within 240 days after the date of
the Incurrence (with such reduction to be certified in writing
to the Administrative Agent by the Borrower);
(ii) Total Secured Outstanding Indebtedness which would
not exceed forty percent (40%) of Total Value as of the date
of incurrence, or
(iii) Total Recourse Secured Outstanding Indebtedness
which would not exceed ten percent (10%) of Total Value as of
the date of incurrence."
2.2.2. Section 10.11(b) is hereby amended by deleting the
words "the date hereof" at the end of such Section 10.11(b) and
replacing such words with the date "June 20, 2005".
3. Provisions Of General Application.
----------------------------------
3.1. Representations and Warranties. The Borrower hereby represents
and warrants as of the date hereof that (a) each of the representations
and warranties of the Borrower contained in the Term Loan Agreement, the
other Loan Documents or in any document or instrument delivered pursuant
to or in connection with the Term Loan Agreement or this Amendment No. 1
are true and correct in all material respects as of the date as of which
they were made and are true and correct in all material respects at and
as of the date of this Amendment No. 1 (except to the extent that such
representations and warranties expressly speak as of a different date),
(b) no Potential Event of Default or Event of Default exists on the date
hereof, and (c) this Amendment No. 1 has been duly authorized, executed
and delivered by the Borrower and is in full force and effect as of the
Effective Date, and the agreements and obligations of the Borrower
contained herein constitute the legal, valid and binding obligations of
the Borrower, enforceable against it in accordance with its terms,
except to the extent that the enforcement hereof or the availability of
equitable remedies may be limited by applicable bankruptcy,
reorganization, insolvency, moratorium, fraudulent transfer, fraudulent
conveyance or similar laws now or hereafter in effect relating to or
affecting creditors' rights generally or by general principles of
equity, or by the discretion of any court in awarding equitable
remedies, regardless of whether such enforcement is considered in a
preceding in equity or at law.
3.2. No Other Changes. Except as otherwise expressly provided or
contemplated by this Amendment No. 1, all of the terms, conditions and
-6-
provisions of the Term Loan Agreement remain unaltered and in full force
and effect. The Term Loan Agreement and this Amendment No. 1 shall be
read and construed as one agreement. The making of the amendments in
this Amendment No. 1 does not imply any obligation or agreement by the
Administrative Agent or any Lender to make any other amendment, waiver,
modification or consent as to any matter on any subsequent occasion.
3.3. Governing Law. This Amendment No. 1 shall be deemed to be a
contract under the laws of the State of New York. This Amendment No. 1
and the rights and obligations of each of the parties hereto are
contracts under the laws of the State of New York and shall for all
purposes be construed in accordance with and governed by the laws of
such State (excluding the laws applicable to conflicts or choice of
law).
3.4. Assignment. This Amendment No. 1 shall be binding upon and
inure to the benefit of each of the parties hereto and their respective
permitted successors and assigns.
3.5. Counterparts. This Amendment No. 1 may be executed in any
number of counterparts, but all such counterparts shall together
constitute but one and the same agreement. In making proof of this
Amendment No. 1, it shall not be necessary to produce or account for
more than one counterpart thereof signed by each of the parties hereto.
4. Effectiveness of this Amendment No. 1. This Amendment No. 1 shall
become effective on the date on which the following conditions precedent are
satisfied (such date being hereinafter referred to as the "Effective Date"):
(a) Execution and delivery to the Administrative Agent by each of
the Lenders, the Borrower, the Guarantors and the Administrative Agent
of this Amendment No. 1.
(b) Execution and delivery to the Administrative Agent of (i) a
certificate of the Borrower confirming that there have been no changes
to its charter documents since May 12, 2005, or (ii) if there have been
changes to the Borrower's charter document since such date, a
secretary's certificate of the Borrower certifying as to such changes.
(c) Delivery to the Administrative Agent of an incumbency
certificate of the Borrower and of resolutions of the board of directors
of the general partner of the Borrower authorizing this Amendment No. 1.
(d) Payment to the Administrative Agent, for the accounts of the
Agents and the Lenders, as applicable, all fees due and payable on or
before the Effective Date and all expenses due and payable on or before
the Effective Date, including, without limitation, reasonable attorneys'
fees and expenses
-7-
and other costs and expenses incurred in connection with this Amendment
No. 1.
(e) Delivery to the Administrative Agent by Fried Frank Harris
Shriver & Jacobson LLP, as counsel to the Borrower, of an opinion
addressed to the Lenders and the Administrative Agent in form and
substance reasonably satisfactory to the Administrative Agent.
[Remainder of page left blank intentionally]
IN WITNESS WHEREOF, the undersigned have duly executed and delivered
this Amendment No. 1 as of the date first set forth above.
RECKSON OPERATING PARTNERSHIP, L.P.
By: Reckson Associates Realty Corp.,
its general partner
By: /s/ Michael Maturo
------------------------------------
Name: Michael Maturo
Title: Chief Financial Officer
CITICORP NORTH AMERICA, INC.,
as Administrative Agent and as Lender
By: /s/ Jeanne M. Craig
------------------------------------
Name: Jeanne M. Craig
Title: Vice President
Each of the undersigned Guarantors hereby acknowledges the foregoing Amendment
No. 1 and reaffirms its guaranty of the Guaranteed Obligations (as defined in
the Guaranty executed and delivered by such Guarantor) under the Credit
Agreement and the other Loan Documents, each as amended hereby or in
connection herewith, in accordance with the Guaranty executed and delivered by
such Guarantor.
RECKSON ASSOCIATES REALTY CORP.
By: /s/ Michael Maturo
------------------------------------
Name: Michael Maturo
Title: Chief Financial Officer
[Remainder of Signature Pages Intentionally Omitted]
Exhibit 10.3
COMMON STOCK DELIVERY AGREEMENT
This Common Stock Delivery Agreement (the "Agreement") is being made as
of the 21st day of June, 2005 by and between Reckson Operating Partnership,
L.P., a Delaware limited partnership (the "Operating Partnership"), and
Reckson Associates Realty Corp., a Maryland corporation (the "Company").
Recitals
--------
WHEREAS, the Company is the general partner of the Operating Partnership;
and
WHEREAS, the Operating Partnership and the Company have entered into an
Underwriting Agreement, dated June 21, 2005, with Citigroup Global Markets
Inc. (the "Underwriter"), as such Underwriting Agreement is incorporated by
reference into a Terms Agreement, dated June 21, 2005, among the Operating
Partnership, the Company and the Underwriter, providing for the sale to the
Underwriter by the Operating Partnership of $250,000,000 aggregate principal
amount of its 4.00% Exchangeable Senior Debentures due 2025 (the "Debentures")
under the Indenture, dated as of March 26, 1999, among the Operating
Partnership, as Issuer, the Company, as Guarantor, and The Bank of New York,
as Trustee (the "Indenture"), and granting the Underwriter an option to
purchase up to an additional $37,500,000 in principal amount of the Debentures
to cover any over-allotments, which Debentures shall be exchangeable into cash
and, if applicable, shares of common stock, par value $0.01 per share, of the
Company (the "Common Stock") under certain circumstances; and
WHEREAS, the Debentures will be fully and unconditionally guaranteed as
to the payment of principal thereof and interest thereon by the Company (the
"Guarantee").
NOW, THEREFORE, in consideration of the foregoing and in consideration of
the mutual covenants contained herein, the parties agree as follows:
Agreement
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1. The Operating Partnership hereby acknowledges that it is the primary
obligor of the Debentures and is, therefore, responsible for the obligations
contained in the Debentures, other than those related to the Guarantee.
2. If the Operating Partnership determines, in its sole discretion, to
deliver Net Shares (as such term is defined in the Debentures) upon an
exchange of the Debentures by a holder in accordance with the terms of the
Debentures and the Indenture, the Company agrees to issue to the Operating
Partnership the number of shares of Common Stock determined by the Operating
Partnership to be delivered to such holder in respect of such Net Shares, and
the Operating Partnership hereby directs the Company to deliver such Net
Shares to such holder on behalf of the Operating Partnership in accordance
with the terms of the Debentures and the Indenture.
3. The Operating Partnership agrees to issue to the Company on a
concurrent basis a number of "Partnership Units" (as defined in the Amended
and Restated Agreement of Limited Partnership of the Operating Partnership,
dated June 2, 1995, as amended) equal in number to the number of shares of
Common Stock issued by the Company pursuant to this Agreement.
4. The Company agrees that it will not consolidate with or merge into
another business entity or transfer or lease all or substantially all of its
assets, unless:
o either (1) the Company is the continuing entity in the case of
a merger or (2) the resulting, surviving or acquiring entity,
if other than the Company, is a U.S. entity and it expressly
assumes the Company's obligations under this Agreement and the
Indenture;
o immediately after giving effect to the transaction, no Event of
Default under, and as defined in, the Indenture and no
circumstances which, after notice or lapse of time or both,
would become an Event of Default under the Indenture, shall
have happened and be continuing; and
o the Company has delivered to the Trustee an officers'
certificate and a legal opinion confirming that the Company has
complied with the Indenture.
5. Miscellaneous.
(a) This Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to conflict
laws, rules or principles.
(b) No provision of this Agreement may be amended, modified or
waived, except in writing signed by both parties.
(c) In the event that any claim of inconsistency between this
Agreement and the terms of the Indenture arise, as they may from time to
time be amended, the terms of the Indenture shall control.
(d) If any provision of this Agreement shall be held illegal,
invalid or unenforceable by any court, this Agreement shall be construed
and enforced as if such provision had not been contained herein and shall
be deemed an Agreement between the parties hereto to the full extent
permitted by applicable law.
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(e) This Agreement shall be binding upon, inure to the benefit of
and be enforceable by the respective successors and assigns of the
parties hereto.
(f) This Agreement may not be assigned by either party without the
prior written consent of both parties.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement by
their duly authorized officers as of the day and year above written.
RECKSON OPERATING PARTNERSHIP, L.P.
By: Reckson Associates Realty Corp.,
its General Partner
By: /s/ Jason M. Barnett
-----------------------------------------
Name: Jason M. Barnett
Title: Executive Vice President,
General Counsel and Secretary
RECKSON ASSOCIATES REALTY CORP.
By: /s/ Jason M. Barnett
-----------------------------------------
Name: Jason M. Barnett
Title: Executive Vice President,
General Counsel and Secretary
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