Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - Brookdale Senior Living Inc. | form8-k.htm |
| EX-99.1 - PRESS RELEASE - Brookdale Senior Living Inc. | exhibit99_1.htm |
EXHIBIT
1.1
EXECUTION
COPY
Brookdale
Senior Living Inc.
Common
Stock
__________
Underwriting
Agreement
November
9, 2009
Merrill
Lynch, Pierce, Fenner & Smith
Incorporated
One
Bryant Park
New York,
New York 10036
Ladies
and Gentlemen:
Certain
stockholders of Brookdale Senior Living Inc., a Delaware corporation (the “Company”), named in Schedule II hereto
(the “Selling
Stockholders”) propose severally and not jointly, subject to the terms
and conditions set forth herein, to sell to Merrill Lynch, Pierce, Fenner &
Smith Incorporated (the “Underwriter”) an aggregate of
16,550,000 shares (the “Firm
Shares”) of common stock, par value $0.01 per share, of the Company
(“Common Stock”). In
addition, the Selling Stockholders have granted to the Underwriter an option to
purchase up to an additional 1,655,000 shares (the “Optional Shares”) of Common
Stock, as provided in Section 3. The Firm Shares and the
Optional Shares that the Underwriter elects to purchase pursuant to Section 3 hereof are
herein collectively called the “Shares”.
1. The
Company represents and warrants to, and agrees with, each of the Selling
Stockholders and the Underwriter that:
(a) A
registration statement on Form S-3 (File No. 333-159146), which contains a base
prospectus (the “Base
Prospectus”) to be used in connection with the public offering and sale
of the Shares has been filed with the Securities and Exchange Commission (the
“Commission”); such
registration statement, as amended, including the financial statements, exhibits
and schedules thereto, at each time of effectiveness under the Securities Act of
1933 and the rules and regulations promulgated thereunder (collectively, the
“Act”), including any
required information deemed to be a part thereof at the time of effectiveness
pursuant to Rule 430B under the Act or the Securities Exchange Act of 1934 and
the rules and regulations promulgated thereunder (collectively, the “Exchange Act”), is called the
“Registration
Statement.” Any registration statement filed by the Company pursuant to
Rule 462(b) under the Act is called the “Rule 462(b) Registration
Statement,” and from and after the date and time of filing of the Rule
462(b) Registration Statement the term “Registration Statement”;
provided, however, that “Registration Statement” without reference to a time
means the Registration
Statement
as of the time of the first contract of sale for the Shares, which time shall be
considered the “new effective date” of the Registration Statement with respect
to the Underwriter and the Shares (within the meaning of Rule 430B(f)(2) under
the Act (“Rule
430B(f)(2)”)) shall include the Rule 462(b) Registration Statement. Any
preliminary prospectus supplement to the Base Prospectus that describes the
Shares and the offering thereof and is used prior to filing of the Final
Prospectus is called, together with the Base Prospectus, a “preliminary
prospectus.” The term “Prospectus” shall mean the
final prospectus relating to the Shares that is first filed pursuant to Rule
424(b) after the date and time that this Agreement is executed and delivered by
the parties hereto. Any reference herein to the Registration
Statement, any preliminary prospectus or the Prospectus shall be deemed to refer
to and include the documents incorporated by reference therein pursuant to Item
12 of Form S-3 under the Act; any reference to any amendment or supplement to
any preliminary prospectus or the Prospectus shall be deemed to refer to and
include any documents filed after the date of such preliminary prospectus or
Prospectus, as the case may be, under the Exchange Act, and incorporated by
reference in such preliminary prospectus or Prospectus, as the case may be; and
any reference to any amendment to the Registration Statement shall be deemed to
refer to and include any annual report of the Company filed pursuant to Section
13(a) or 15(d) of the Exchange Act after the effective date of the Registration
Statement that is incorporated by reference in the Registration Statement; any
“issuer free writing
prospectus” as defined in Rule 433 under the Act relating to the Shares
is hereinafter called an “Issuer Free Writing
Prospectus”);
(b) The
Registration Statement has been declared effective by the Commission under the
Act. No stop order suspending the effectiveness of the Registration
Statement is in effect, the Commission has not issued any order or notice
preventing or suspending the use of the Registration Statement, any preliminary
prospectus or the Prospectus and no proceedings for such purpose have been
instituted or are pending or, to the knowledge of the Company, are contemplated
or threatened by the Commission;
(c) Each
preliminary prospectus and the Prospectus when filed conformed in all material
respects with the Act. Each of the Registration Statement and any
post-effective amendment thereto, at the time it became effective and at the
date hereof, conformed and will conform in all material respects with the Act
and did not and will not contain any untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary in order to
make the statements therein not misleading. The Prospectus (including
any Prospectus wrapper), as amended or supplemented, as of its date, at the date
hereof, at the time of any filing pursuant to Rule 424(b) under the Act and at
the Time of Delivery (as defined herein) did not and will not contain any 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. The representations and warranties
set forth in the two immediately preceding sentences do not apply to statements
in or omissions from the Registration Statement or any
2
post-effective
amendment thereto, or the Prospectus, or any amendments or supplements thereto,
made in reliance upon and in conformity with information furnished in writing to
the Company (i) by the Underwriter, it being understood and agreed that the only
such information furnished by the Underwriter consists of the information
described as such in Section 11(c), or
(ii) by the Selling Stockholders, it being understood and agreed that the only
such information furnished by the Selling Stockholders consists of the
information described as such in Section
11(b). There is no contract or other document required to be
described in the Prospectus or to be filed as an exhibit to the Registration
Statement that has not been described or filed as required;
(d) The
documents incorporated by reference in the Prospectus, when they became
effective or were filed with the Commission, as the case may be, conformed in
all material respects to the requirements of the Exchange Act. Any further
documents so filed and incorporated by reference in the Prospectus or any
further amendment or supplement thereto, when such documents become effective or
are filed with the Commission, as the case may be, will conform in all material
respects to the requirements of the Act or the Exchange Act, as applicable, and
the rules and regulations of the Commission thereunder;
(e) For
the purposes of this Agreement, the “Applicable Time” is 5:15 p.m.,
New York City time, on November 9, 2009. The “Pricing Disclosure Package”
shall mean (i) the preliminary prospectus relating to the Shares immediately
prior to that time, (ii) the Issuer Free Writing Prospectus listed on Schedule III(b)
hereto and (iii) the information set forth on Schedule V relating
to the number of Shares being sold and the price at which the Shares will be
sold to the public. As of the Applicable Time, the Pricing Disclosure
Package did not include any untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; and each
Issuer Free Writing Prospectus listed on Schedule III(a)
or Schedule
III(b) hereto does not conflict with the information contained in the
Registration Statement that has not been superseded or modified, including any
prospectus or prospectus supplement that is or becomes part of the Registration
Statement, and each such Issuer Free Writing Prospectus, as supplemented by and
taken together with the Pricing Disclosure Package as of the Applicable Time,
did not include any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided, however,
that this representation and warranty shall not apply to statements or omissions
made in an Issuer Free Writing Prospectus in reliance upon and in conformity
with information furnished in writing to the Company (i) by the Underwriter, it
being understood and agreed that the only such information furnished by the
Underwriter consists of the information described as such in Section 11(c), or
(ii) by the Selling Stockholders, it being understood and agreed that the only
such information furnished by the Selling Stockholders consists of the
information described as such in Section
11(b);
3
(f) Neither
the Company nor any of its subsidiaries has sustained since the date of the
latest audited financial statements included in the Pricing Disclosure Package
and the Prospectus, any material loss or interference with its business from
fire, explosion, flood or other calamity, whether or not covered by insurance,
or from any labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Pricing Disclosure Package
and the Prospectus, and, since the respective dates as of which information is
given in the Registration Statement and the Pricing Disclosure Package and the
Prospectus, there has not been any change in the capital stock or long-term debt
of the Company or any of its subsidiaries or any material adverse change, or any
development that would reasonably be expected to involve a prospective material
adverse change, in or affecting the general affairs, management, financial
position, stockholders’ equity, assets or results of operations of the Company
and its subsidiaries taken as a whole, otherwise than as set forth or
contemplated in the Pricing Disclosure Package and the Prospectus;
(g) The
Company and its subsidiaries have good and marketable title in fee simple to all
real property and good and marketable title to all personal property owned by
them, in each case free and clear of all liens, encumbrances and defects except
such as (A) are described in the Pricing Disclosure Package and the Prospectus,
(B) do not, individually or in the aggregate, result in a material adverse
effect on the current or future consolidated financial position, stockholders’
equity, assets or results of operations of the Company and its subsidiaries (a
“Material Adverse
Effect”), or (C) would not, individually or in the aggregate, reasonably
be expected to result in a Material Adverse Effect; and any real property and
buildings held under lease by the Company and its subsidiaries are held by them
under valid, subsisting and enforceable leases with such exceptions as are
described in the Pricing Disclosure Package and the Prospectus or as would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect;
(h) The
Company has been duly incorporated and is validly existing as a corporation in
good standing under the laws of the State of Delaware, with power and authority
(corporate and other) to own its properties and conduct its business as
described in the Pricing Disclosure Package and the Prospectus, and has been
duly qualified as a foreign corporation for the transaction of business and is
in good standing under the laws of each other jurisdiction in which it owns or
leases properties or conducts any business so as to require such qualification,
except to the extent that the failure to be so qualified would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect;
and each subsidiary of the Company that is listed on Schedule IV to this
Agreement has been duly organized, is validly existing and is in good standing
under the laws of its jurisdiction of incorporation or formation, as
applicable;
(i) The
Company has an authorized capitalization as set forth in the Pricing Disclosure
Package and the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully paid and
non-assessable and conform to the description of the Common Stock
4
contained
in the Pricing Disclosure Package and the Prospectus; and all of the issued
shares of capital stock of each subsidiary of the Company have been duly and
validly authorized and issued, are fully paid and non-assessable and (except for
directors’ qualifying shares) are owned directly or indirectly by the Company,
free and clear of all liens, encumbrances, equities or claims (except for the
security interest in favor of Bank of America, N.A., as administrative agent
under the Second Amended and Restated Credit Agreement, dated February 27, 2009,
as amended);
(j) [INTENTIONALLY
OMITTED]
(k) The
compliance by the Company with all of the provisions of this Agreement and the
consummation of the transactions contemplated herein will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, (x) any indenture, mortgage, deed of trust, loan
agreement, lease, sublease or other agreement or instrument to which the Company
or any of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, (y) the Amended and Restated Certificate
of Incorporation or Amended and Restated By-laws of the Company or (z) any
statute or any order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Company or any of its subsidiaries or any of
their properties, except in the case of clauses (x) and (z) for such conflicts,
breaches, defaults or violations that would not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect; and no
consent, approval, authorization, order, registration or qualification of or
with any such court or governmental agency or body or any other third party is
required for the sale of the Shares by the Selling Stockholders or the
consummation by the Company of the transactions contemplated by this Agreement,
except for such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Shares by the
Underwriter;
(l) Neither
the Company nor any of its subsidiaries is (x) in violation of its certificate
of incorporation, by-laws, limited liability company operating agreement or
partnership agreement, as applicable, or (y) in default in the performance or
observance of any obligation, agreement, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement, lease or other agreement or
instrument to which it is a party or by which it or any of its properties may be
bound, except in the case of clause (x), but only with respect to subsidiaries
of the Company, and clause (y) for such violations or defaults that would not,
individually or in the aggregate, reasonably be expected to result in a Material
Adverse Effect;
(m) The
statements set forth in the Pricing Disclosure Package and the Prospectus under
the caption “Description of Capital Stock”, insofar as they purport to
constitute a summary of the terms of the Common Stock, under the
5
captions
“Material U.S. Federal Income and Estate Tax Considerations to Non-U.S.
Holders”, “Business -- Government Regulation”, “Business -- Environmental
Matters” and “Underwriting”, insofar as they purport to describe the provisions
of the laws and documents referred to therein, are accurate, complete and
fair;
(n) Other
than as set forth in the Pricing Disclosure Package and the Prospectus, there
are no legal or governmental proceedings pending to which the Company or any of
its subsidiaries is a party or of which any property of the Company or any of
its subsidiaries is the subject which, if determined adversely to the Company,
any of its subsidiaries, would individually or in the aggregate have a Material
Adverse Effect; and, to the Company’s knowledge, no such proceedings or any
investigations are threatened or contemplated by governmental authorities or
threatened by others;
(o) The
Company is not and, after giving effect to the offering and sale of the Shares,
will not be an “investment company”, as such term is defined in the Investment
Company Act of 1940, as amended (the “Investment Company
Act”);
(p) The
financial statements included in the Pricing Disclosure Package and the
Prospectus (taken together with the related notes and schedules thereto) present
fairly, in all material respects, the financial position of the Company and its
subsidiaries as of the dates shown and their results of operations and cash
flows for the periods shown, and such financial statements have been prepared in
conformity with the generally accepted accounting principles in the United
States applied on a consistent basis and the schedules included in each
Registration Statement present fairly, in all material respects, the information
required to be stated therein;
(q) Ernst
& Young LLP, who have certified certain financial statements of the Company
and its subsidiaries incorporated by reference in the Registration Statement and
incorporated by reference in the Pricing Disclosure Package and the Prospectus,
are independent public accountants as required by the Act and the Exchange Act
and the rules and regulations of the Commission thereunder;
(r) The
Company maintains a system of internal control over financial reporting (as such
term is defined in Rule 13a-15(f) under the Exchange Act) that complies with the
requirements of the Exchange Act and has been designed by the Company’s
principal executive officer and principal financial officer, or under their
supervision, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles. The Company’s internal control over financial reporting
is effective and the Company is not aware of any material weaknesses in its
internal control over financial reporting;
(s) Since
the date of the latest audited financial statements of the Company included in
the Pricing Disclosure Package and the Prospectus, there has
6
been no
change in the Company’s internal control over financial reporting that has
materially affected, or is reasonably likely to materially affect, the Company’s
internal control over financial reporting;
(t) The
Company maintains disclosure controls and procedures (as such term is defined in
Rule 13a-15(e) under the Exchange Act) that comply with the requirements of the
Exchange Act; such disclosure controls and procedures have been designed to
ensure that material information relating to the Company and its subsidiaries is
made known to the Company’s principal executive officer and principal financial
officer by others within those entities; and such disclosure controls and
procedures are effective;
(u) Each
of the Company and its subsidiaries (x) has all certificates, consents,
exemptions, orders, permits, licenses, authorizations, or other approvals (each,
an “Authorization”) of
and from, and has made all declarations and filings with, all federal, state,
local and other governmental authorities, all self-regulatory organizations and
all courts and other tribunals, necessary or required to engage in the business
currently conducted by it in the manner described in the Pricing Disclosure
Package and the Prospectus; (y) all such Authorizations are valid and in full
force and effect; and (z) each of the Company and its subsidiaries is in
compliance with the terms and conditions of all such Authorizations and with the
rules and regulations of the regulatory authorities and governing bodies having
jurisdiction with respect thereto, except, with respect to (x), (y) and (z), as
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect; and there are no proceedings pending or, to the best of
the Company’s knowledge, threatened, to revoke, cancel or terminate such
Authorizations and applications and the Company is not aware of any basis on
which such Authorizations could not be renewed or, in the case of applications,
will not be issued without contest;
(v) Each
of the Company and its subsidiaries owns or possesses or has the right to use
the licenses, material copyrights, know-how (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information, systems
or procedures), domain names, trademarks, service marks and trade names
(collectively, the “Intellectual Property”)
presently employed by it in connection with its operations, except where the
failure to own or possess or have the right to use such Intellectual Property
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect; and neither the Company nor any of its subsidiaries has
received any notice of infringement of or conflict with asserted rights of
others with respect to the foregoing. To the knowledge of the Company
and its subsidiaries, the use of such Intellectual Property in connection with
the business and operations of the Company and its subsidiaries as described in
the Pricing Disclosure Package does not infringe on the rights of any
person;
(w) All
tax returns required to be filed by the Company and its subsidiaries in all
jurisdictions have been timely and duly filed, other than those
7
filings
being contested in good faith and except where the failure to file would not,
individually or in the aggregate, have a Material Adverse
Effect. There are no tax returns of the Company or its subsidiaries
that are currently being audited by state, local or federal taxing authorities
or agencies (and with respect to which the Company or its subsidiaries has
received notice), where the findings of such audit could reasonably be expected
to result in a Material Adverse Effect. All taxes, including
withholding taxes, penalties and interest, assessments, fees and other charges
due or claimed to be due from such entities, have been paid, other than those
being contested in good faith and for which adequate reserves have been provided
or those currently payable without penalty or interest or those that could not
reasonably be expected to result in a Material Adverse Effect;
(x) Except
as disclosed in the Pricing Disclosure Package and the Prospectus, each of the
Company and its subsidiaries maintains insurance covering its properties,
operations, personnel and businesses which insures against such losses and risks
as are adequate in accordance with its reasonable business judgment to protect
the Company and its subsidiaries and their businesses;
(y) Except
as disclosed in the Pricing Disclosure Package and the Prospectus, there are no
material business relationships or related party transactions which would be
required to be disclosed therein by Item 404 of Regulation S-K of the Commission
and such business relationship or related party transaction described therein is
a fair and accurate description in all material respects of the relationships
and transactions so described;
(z) Each
of the Company and its subsidiaries is in compliance in all material respects
with all presently applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations and published
interpretations thereunder (“ERISA”); no “reportable event”
(as defined in ERISA) has occurred with respect to any “pension plan” (as
defined in ERISA) for which the Company or any of its subsidiaries would have
any material liability; each of the Company and its subsidiaries has not
incurred and does not reasonably expect to incur liability under (i) Title IV of
ERISA with respect to termination of, or withdrawal from, any “pension plan” or
(ii) Section 412 or 4971 of the Internal Revenue Code of 1986, as amended,
including the regulations and published interpretations thereunder (the “Code”); and each “pension
plan” for which the Company or any of its subsidiaries would have any material
liability, that is intended to be qualified under Section 401(a) of the Code is
so qualified in all material respects and nothing has occurred, whether by
action or by failure to act, which would cause the loss of such
qualification;
(aa) Each
of the Company and its subsidiaries is and has been in compliance with all
applicable Environmental Laws (as defined below), except where failure to comply
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. To the best of the Company’s knowledge,
there has been no material seepage, leak, escape, leach, discharge, injection,
release, emission, spill, pumping, pouring, emptying, dumping,
8
disposing,
or migrating or any threat thereof of any Hazardous Material (as defined below)
on, in, under, or from any real property referred to in the Pricing Disclosure
Package and the Prospectus which requires any disclosure, investigation,
cleanup, remediation, monitoring, maintenance, abatement or deed or use
restriction, or which will give rise to any other costs or liabilities to the
Company or its subsidiaries under any Environmental Laws. There are
no past, present or, to the Company’s knowledge, reasonably anticipated future
events, conditions, circumstances, activities, practices, actions, omissions or
plans that could reasonably be expected to interfere with or prevent compliance
by the Company or its subsidiaries with Environmental Laws, or that could
reasonably be expected to give rise to any material costs or liabilities, which
could reasonably be expected to, either individually or in the aggregate, have a
Material Adverse Effect. There are no judicial or administrative
proceedings of an environmental nature pending, or to the best of the Company’s
knowledge, threatened against the Company or its subsidiaries which could
reasonably be expected to be material to the business or financial condition of
the Company and its subsidiaries to involve potential damages, monetary
sanctions, capital expenditures, deferred charges or charges to income exceeding
ten percent of the current assets of the Company and its subsidiaries or to
involve potential monetary sanctions of $100,000.00 or more. None of
the Company or its subsidiaries has received notice from any governmental agency
or body or other person of any actual or alleged violation of or actual or
alleged liability under any Environmental Law, and does not otherwise have
knowledge of, any occurrence, condition or circumstance which, with notice,
passage of time, or failure to act, would give rise to any claim or liability
under or pursuant to any Environmental Law. The Company or its
subsidiaries, has not arranged for the disposal of any Hazardous Material at, or
transported any Hazardous Material to, any site which could result in material
liability for the Company or its subsidiaries. The Company or its
subsidiaries has not entered into any agreement relating to any alleged
violation of any Environmental Law or any actual or alleged release or
threatened release or cleanup at any location of any Hazardous
Materials. As used herein, “Environmental Law” means any
federal, state, local or foreign law, statute, ordinance, rule, regulation,
order, decree, judgment, injunction, permit, license, authorization or other
binding requirement, or common law, relating to health, safety or the
protection, cleanup or restoration of the environment or natural resources,
including, but not limited to, those relating to the distribution, processing,
generation, treatment, storage, disposal, transportation, other handling or
release or threatened release of Hazardous Materials, and “Hazardous Materials” means any
material (including, without limitation, pollutants, contaminants, hazardous or
toxic substances or wastes, asbestos, silica, mixed dust, petroleum or
constituents thereof, bacteria, radon, mold or fungi) that is regulated by or
may give rise to liability under any Environmental Law. The Company
has provided you copies of all materials and potentially material environmental
studies, investigations, reports or assessments concerning the Company, or any
currently or previously owned or leased properties within its possession or
control. In the ordinary course of its business, the Company conducts
a periodic review of the effect of the Environmental Laws on
9
its
business, operations and properties, in the course of which it
identifies and evaluates associated costs and liabilities (including, without
limitation, any capital or operating expenditures required for cleanup, closure
of properties or compliance with the Environmental Laws or any permit, license
or approval, any related constraints on operating activities and any potential
liabilities to third parties);
(bb) At
the time of filing the Registration Statement the Company was not and is not an
“ineligible issuer,” as defined under Rule 405 under the Act;
(cc) There
are no persons with registration or other similar rights to have any securities
registered for sale under the Registration Statement or included in the offering
contemplated by this Agreement, except for such rights as have been duly
waived;
(dd) Neither
the Company nor any of its subsidiaries nor, to the knowledge of the Company,
any director, officer or employee of the Company or any of its subsidiaries is
aware of or has taken any action, directly or indirectly, that would result in a
violation by such persons of the Foreign Corrupt Practices Act of 1977, as
amended, and the rules and regulations thereunder (the “FCPA”), including, without
limitation, making use of the mails or any means or instrumentality of
interstate commerce corruptly in furtherance of an offer, payment, promise to
pay or authorization of the payment of any money, or other property, gift,
promise to give, or authorization of the giving of anything of value to any
“foreign official” (as such term is defined in the FCPA) or any foreign
political party or official thereof or any candidate for foreign political
office, in contravention of the FCPA, and the Company, its subsidiaries and, to
the knowledge of the Company, its affiliates have conducted their businesses in
compliance with the FCPA and have instituted and maintain policies and
procedures designed to ensure, and which are reasonably expected to continue to
ensure, continued compliance therewith;
(ee) The
operations of the Company and its subsidiaries are and have been conducted at
all times in compliance with applicable financial recordkeeping and reporting
requirements of the Currency and Foreign Transactions Reporting Act of 1970, as
amended, the money laundering statutes of all applicable jurisdictions, the
rules and regulations thereunder and any related or similar rules, regulations
or guidelines issued, administered or enforced by any governmental agency
(collectively, the “Money
Laundering Laws”) and no action, suit or proceeding by or before any
court or governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries with respect to the Money Laundering Laws is
pending or, to the knowledge of the Company, threatened; and
(ff) Neither
the Company nor any of its subsidiaries nor, to the knowledge of the Company,
any director, officer or employee of the Company or any of its subsidiaries is
currently subject to any U.S. sanctions administered by the Office of Foreign
Assets Control of the U.S. Treasury Department (“OFAC”).
10
2. The
Selling Stockholders severally and not jointly represent and warrant to, and
agree with, each of the Underwriter and the Company that:
(a) This
Agreement has been duly authorized, executed and delivered by or on behalf of
such Selling Stockholder.
(b) The
execution and delivery by such Selling Stockholder of, and the performance of
such Selling Stockholder of its obligations under this Agreement, the sale of
the Shares to be sold by such Selling Stockholder and the consummation by such
Selling Stockholder of the transactions contemplated herein or therein or by the
Pricing Disclosure Package and the Prospectus will not contravene (i) any
provision of applicable law, or the certificate of incorporation, bylaws or any
other organizational or constitutive documents of such Selling Stockholder, (ii)
any agreement or other instrument binding upon such Selling Stockholder or (iii)
any judgment, order or decree of any governmental body, agency or court having
jurisdiction over such Selling Stockholder, except, with respect to clauses (ii)
and (iii) above, such contraventions as would not have a material adverse effect
on such Selling Stockholder and would not prevent or materially interfere with
the consummation by such Selling Stockholder of the transactions contemplated
hereby; and no consent, approval, authorization or order of, or qualification
with, any governmental body or agency is required for the performance by such
Selling Stockholder of its obligations under this Agreement, except (i) such as
may be required by the securities or Blue Sky laws of the various states or the
laws of any foreign jurisdiction in connection with the offer and sale of the
Shares and (ii) where the failure to obtain such consent approval,
authorization, order or qualification, individually or in the aggregate, would
not have a material adverse effect on such Selling Stockholder and would not
prevent or materially interfere with the consummation of the transactions
contemplated by this Agreement.
(c) The
Selling Stockholder has, and at the Time of Delivery, will have, valid title to,
or a valid “security entitlement” within the meaning of Section 8-501 of the New
York Uniform Commercial Code (“UCC”) in respect of, the
Shares to be sold by such Selling Stockholder free and clear of all security
interests, claims, liens or other encumbrances and the legal right and power,
and all authorization and approval required by law, to enter into this Agreement
and to sell, transfer and deliver the Shares to be sold by such Selling
Stockholder or a security entitlement in respect of such Shares.
(d) With
respect to any Shares delivered by the Selling Stockholder in certificated form
endorsed to the Underwriter, delivery of the Shares to be sold by such Selling
Stockholder and payment therefor pursuant to this Agreement will pass valid
title to such Shares, free and clear of any adverse claim within the meaning of
Section 8-102 of the UCC, to the Underwriter without notice of an adverse
claim.
(e) The
Registration Statement, at the time it became effective and at the date hereof,
conformed in all material respects with the Act and did not and
will
11
not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading. The Prospectus (including any Prospectus
wrapper), as amended or supplemented, as of its date, at the date hereof, at the
time of any filing pursuant to Rule 424(b) under the Act and at the Time of
Delivery (as defined herein) did not and will not contain any 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. As of the Applicable Time, the Pricing
Disclosure Package did not include any untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; and each Issuer Free Writing Prospectus listed on Schedule III(a)
or Schedule
III(b) hereto does not conflict with the information contained in the
Registration Statement that has not been superseded or modified, including any
prospectus or prospectus supplement that is or becomes part of the Registration
Statement, and each such Issuer Free Writing Prospectus, as supplemented by and
taken together with the Pricing Disclosure Package as of the Applicable Time,
did not include any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided that the
representations and warranties set forth in this Section 2(e) are
limited to statements or omissions made in reliance upon and in conformity with
information relating to such Selling Stockholder furnished to the Company in
writing by such Selling Stockholder expressly for use in the Registration
Statement, the Pricing Disclosure Package, the Prospectus, each Issuer Free
Writing Prospectus or any amendments or supplements thereto.
(f) The
Selling Stockholder has no knowledge of any material fact, condition or
information not disclosed in the Pricing Disclosure Package that has had, or is
reasonably likely to have, a Material Adverse Effect.
(g) The
Selling Stockholder agrees that the Firm Shares and Optional Shares, if
any, to be sold by
such Selling Stockholder are subject to the interests of the Underwriter and
that the obligations of such Selling Stockholder hereunder shall not be
terminated, except as provided in this Agreement. If such Selling
Stockholder becomes incapacitated, or if any other event should occur affecting
the legal status or capacity of such Selling Stockholder before the delivery of
the Firm Shares and the Optional Shares, if any, to be sold by such Selling
Stockholder hereunder, the documents evidencing the Firm Shares and the Optional
Shares, if any, to be sold by such Selling Stockholder shall be delivered by
such Selling Stockholder’s representative in accordance with the terms and
conditions of this Agreement as if such event had not
occurred.
Any
certificate signed by any officer of a Selling Stockholder and delivered to the
Underwriter or counsel for the Underwriter in connection with the offering of
the Shares shall be deemed a representation and warranty by such Selling
Stockholder, as to matters covered thereby, to the Underwriter.
12
3. Subject
to the terms and conditions herein set forth, (a) each of the Selling
Stockholders agrees, severally and not jointly, to sell to the Underwriter, and
the Underwriter agrees to purchase from the Selling Stockholders, at a purchase
price per share of $15.52, all of the Firm Shares and (b) in the event and to
the extent that the Underwriter shall exercise the election to purchase Optional
Shares as provided below, each of the Selling Stockholders agrees, severally and
not jointly, to sell to the Underwriter, and the Underwriter agrees to purchase
from the Selling Stockholders, at the purchase price per share set forth in
clause (a) of this Section 3, that
portion of the number of Optional Shares as to which such election shall have
been exercised.
Each of
the Selling Stockholders hereby grants to the Underwriter the right to purchase
at its election up to 1,655,000 Optional
Shares, at the purchase price per share set forth in the paragraph above, for
the sole purpose of covering sales of shares in excess of the number of Firm
Shares, provided that the purchase price per Optional Share shall be reduced by
an amount per share equal to any dividends or distributions declared by the
Company and payable on the Firm Shares but not payable on the Optional
Shares. Any such election to purchase Optional Shares may be
exercised only by written notice from you to the Selling Stockholders, given
within a period of 30 calendar days after the date of this Agreement and setting
forth the aggregate number of Optional Shares to be purchased and the date on
which such Optional Shares are to be delivered, as determined by you but in no
event earlier than the First Time of Delivery (as defined in Section 5 hereof) or,
unless you and the Selling Stockholders otherwise agree in writing, earlier than
two or later than ten business days after the date of such notice.
4. Upon
the authorization by the Underwriter of the release of the Firm Shares, the
Underwriter proposes to offer the Firm Shares for sale upon the terms and
conditions set forth in the Prospectus.
5. (a) The
Shares to be purchased by the Underwriter hereunder, in definitive form, and in
such authorized denominations and registered in such names as the Underwriter
may request upon at least forty-eight hours’ prior notice to the Selling
Stockholders shall be delivered by or on behalf of the Selling Stockholders to
the Underwriter, through the facilities of the Depositary Trust Company for the
account of the Underwriter, against payment by or on behalf of the Underwriter
of the purchase price therefor by wire transfer of Federal (same-day) funds to
the account specified by the Selling Stockholders
to the Underwriter at least twenty-four hours in advance. The Selling
Stockholders will cause the certificates representing the Shares to be made
available for checking and packaging prior to the Time of Delivery (as defined
below) with respect thereto at the office of Merrill Lynch, Pierce, Fenner &
Smith Incorporated, One Bryant Park, New York, New York 10036 (the “Designated
Office”). The time and date of such delivery and payment shall
be, with respect to the Firm Shares, 9:30 a.m., New York time, on November 13,
2009 or such other time and date as the Underwriter and the Selling Stockholders
may agree upon in writing, and, with respect to the Optional Shares, 9:30 a.m.,
New York time, on the date specified by the Underwriter in the written notice
given by the Underwriter’s election to purchase such Optional Shares, or such
other time and date as the Underwriter and the Selling Stockholders may agree
upon in writing. Such time and date for delivery of the Firm Shares
is herein called the “First
Time of Delivery”, such time and date for delivery of the Optional
Shares, if not the First Time of Delivery, is herein called the “Second Time of Delivery”, and
each such time and date for delivery is herein called a “Time of
Delivery”.
13
(b) The
documents to be delivered at each Time of Delivery by or on behalf of the
parties hereto pursuant to Section 10 hereof,
including the cross receipt for the Shares and any additional documents
requested by the Underwriter pursuant to Section 10 hereof,
will be delivered at the offices of Willkie Farr & Gallagher LLP, 787
Seventh Avenue, New York, New York 10019 (the “Closing Location”), and the
Shares will be delivered at the Designated Office, all at such Time of
Delivery. A meeting will be held at the Closing Location at 1:00
p.m., New York City time, on the New York Business Day (as defined herein) next
preceding such Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be available
for review by the parties hereto. For the purposes of this Section 5, “New York Business Day” shall
mean each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on
which banking institutions in New York are generally authorized or obligated by
law or executive order to close.
6. Company
Agreements. The Company agrees with each of the Selling
Stockholders and the Underwriter:
(a) To
prepare the Prospectus in a form approved by you and to file such Prospectus
pursuant to Rule 424(b) under the Act not later than the Commission’s close of
business on the second business day following the execution and delivery of this
Agreement, or, if applicable, such earlier time as may be required by Rule 430B
under the Act; to make no further amendment or any supplement to the
Registration Statement, Pricing Disclosure Package or Prospectus which shall be
disapproved by you promptly after reasonable notice thereof; to file promptly
all material required to be filed by the Company with the Commission pursuant to
Rule 433(d) under the Act; to advise you, promptly after it receives notice
thereof, of the time when any amendment to the Registration Statement has been
filed or becomes effective or any supplement to the Prospectus or any amended
Prospectus has been filed and to furnish you with copies thereof; to advise you,
promptly after it receives notice thereof, of the issuance by the Commission of
any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or other prospectus in respect of the Shares, of the
suspension of the qualification of the Shares for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for any such
purpose, or of any request by the Commission for the amending or supplementing
of the Registration Statement or Prospectus or for additional information; and,
in the event of the issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or other prospectus or
suspending any such qualification, promptly to use its reasonable best efforts
to obtain the withdrawal of such order;
(b) Promptly
from time to time to take such action as you may reasonably request to qualify
the Shares for offering and sale under the securities laws of such jurisdictions
as you may reasonably request and to comply with such laws so as to permit the
continuance of sales and dealings therein in such jurisdictions for as long as
may be necessary to complete the distribution of the Shares, provided that in
connection therewith the Company shall not be required to qualify as a foreign
corporation or to file a general consent to service of process in any
jurisdiction;
(c) Prior
to 10:00 a.m., New York City time, on the New York Business Day next succeeding
the date of this Agreement and from time to time, to furnish the Underwriter
with written and electronic copies of the Prospectus in New York City in such
quantities as you
14
may
reasonably request, and, if the delivery of a prospectus (or in lieu thereof,
the notice referred to in Rule 173(a) under the Act) is required at any time
prior to the expiration of nine months after the time of issue of the Prospectus
in connection with the offering or sale of the Shares and if at such time any
events shall have occurred as a result of which the Prospectus as then amended
or supplemented would include an untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made when such Prospectus
is delivered (or in lieu thereof, the notice referred to in Rule 173(a) under
the Act is given), not misleading, or, if for any other reason it shall be
necessary during such period to amend or supplement the Prospectus in order to
comply with the Act, to notify you and upon your request to prepare and furnish
without charge to the Underwriter and to any dealer in securities as many
written and electronic copies as you may from time to time reasonably request of
an amended Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance, and in case the Underwriter is
required to deliver a prospectus (or in lieu thereof, give the notice referred
to in Rule 173(a) under the Act) in connection with sales of any of the Shares
at any time nine months or more after the time of issue of the Prospectus, upon
your request but at the expense of the Underwriter, to prepare and deliver to
the Underwriter as many written and electronic copies as you may request of an
amended or supplemented Prospectus complying with Section 10(a)(3) of the
Act;
(d) To
make generally available to the Company’s securityholders as soon as
practicable, but in any event not later than eighteen months after the effective
date of the Registration Statement (as defined in Rule 158(c) under the Act), an
earning statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Act and the rules and regulations
of the Commission thereunder (including, at the option of the Company, Rule
158);
(e) During
the period beginning from the date hereof and continuing to and including the
date 60 days after the date of the Prospectus (the “Initial Lock-Up Period”), not to file
any registration statement on behalf of Fortress Investment Group LLC or any of
their respective affiliates and not to offer, sell, contract to sell or
otherwise dispose of, except as provided hereunder, any securities of the
Company that are substantially similar to the Shares, including but not limited
to any securities that are convertible into or exchangeable for, or that
represent the right to receive, Common Stock or any such substantially similar
securities (other than (i) pursuant to the Company’s Omnibus Stock Incentive
Plan or any other stock incentive or purchase plans existing on the date of this
Agreement or
approved by the Company’s shareholders after the date hereof, or pursuant to any
registration statement on Form S-8, or upon the conversion or exchange of
convertible or exchangeable securities outstanding as of the date of this
Agreement and (ii) the issuance of shares of Common Stock in exchange for the
assets of, or a majority or controlling portion of the equity of, another entity
in connection with the acquisition by the Company or any of its subsidiaries of
such entity; provided, however, that, (y)
the aggregate market value of all such shares may not exceed $100 million and
(z) prior to the issuance of such shares, each recipient of such shares shall
agree in writing with you, in an agreement in the form to be agreed to by you,
not to sell, offer, dispose or otherwise transfer any such shares or options
during such 60-day period, without your prior written consent), without the
prior written consent of the Underwriter; provided, however, that if (1)
during the last 17 days of the Initial Lock-Up Period, the Company releases
earnings results or
15
announces
material news or a material event or (2) prior to the expiration of the initial
Lock-Up Period, the Company announces that it will release earnings results
during the 15-day period following the last day of the Initial Lock-Up Period,
then in each case the Lock-Up Period will be automatically extended until the
expiration of the 18-day period beginning on the date of release of the earnings
results or the announcement of the material news or material event, as
applicable, unless the Underwriter waives, in writing, such extension; the
Company will provide the Underwriter with prior notice of any such announcement
that gives rise to an extension of the Initial Lock-Up Period;
(f) Unless
otherwise publicly available in electronic format on the website of the Company
or the Commission, to furnish to the Company’s stockholders as soon as
practicable after the end of each fiscal year an annual report (including a
balance sheet and statements of income, stockholders’ equity and cash flows of
the Company and its consolidated subsidiaries certified by independent public
accountants) and, as soon as practicable after the end of each of the first
three quarters of each fiscal year (beginning with the fiscal quarter ending
after the date hereof), to make available to the Company’s stockholders
consolidated summary financial information of the Company and its subsidiaries
for such quarter in reasonable detail;
(g) Unless
otherwise publicly available in electronic format on the website of the Company
or the Commission, during a period of three years from the effective date of the
Registration Statement, to furnish to you copies of all reports or other
communications (financial or other) furnished to the Company’s stockholders, and
to deliver to you (i) as soon as they are available, copies of any reports and
financial statements furnished to or filed with the Commission or any national
securities exchange on which any class of securities of the Company is listed,
other than such reports and financial statements that are publicly available on
the Commission’s EDGAR system; and (ii) such additional information concerning
the business and financial condition of the Company as you may from time to time
reasonably request (such financial statements to be on a consolidated basis to
the extent the accounts of the Company and its subsidiaries are consolidated in
reports furnished to its stockholders generally or to the
Commission);
(h) To
file with the Commission such information on Form 10-Q or Form 10-K as may be
required by Rule 463 under the Act;
(i) If
the Company elects to rely upon Rule 462(b), the Company shall file a Rule
462(b) Registration Statement with the Commission in compliance with Rule 462(b)
by 10:00 P.M., Washington, D.C. 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 Act; and
(j) Upon
request of the Underwriter, to furnish, or cause to be furnished, to the
Underwriter an electronic version of the Company’s trademarks, servicemarks and
corporate logo for use on the website, if any, operated by the Underwriter for
the purpose of facilitating the on-line offering of the Shares (the “License”); provided, however,
that the
16
License
shall be used solely for the purpose described above, is granted without any fee
and may not be assigned or transferred.
7. Selling Stockholders
Agreements. The Selling Stockholders severally and not jointly
agree with the Underwriter that:
(a) The
Selling Stockholder shall execute and deliver to the Underwriter, a lock-up
agreement in the form attached hereto as Annex I which shall
be in full force and effect.
(b) In
order to document the Underwriter’s compliance with the reporting and
withholding provisions of the Tax Equity and Fiscal Responsibility Act of 1982
with respect to the transactions herein contemplated, the Selling Stockholder
will deliver to you prior to or at the First Time of Delivery (as hereinafter
defined) a properly completed and executed United States Treasury Department
Form W-9 (or other applicable form or statement specified by Treasury Department
regulations in lieu thereof).
(c) The
Selling Stockholder has not taken and will not take, directly or indirectly, any
action which is designed to or which has constituted or which might reasonably
be expected to cause or result in stabilization or manipulation of the price of
any security of the Company to facilitate the sale or resale of the
Shares.
(d) The
Selling Stockholder will advise you promptly, and if requested by you, will
confirm such advice in writing, so long as delivery of a prospectus relating to
the Shares by an underwriter or dealer may be required under the Act, of (i) any
material change in the Company’s condition (financial or otherwise), prospects,
earnings, business or properties, (ii) any change in information in the
Registration Statement, the Prospectus or any Issuer Free Writing Prospectus or
any amendment or supplement thereto relating to such Selling Stockholder or
(iii) any new material information relating to the Company or relating to
any matter stated in the Prospectus or any Issuer Free Writing Prospectus which
in each case comes to the attention of such Selling Stockholder.
(e) The
Selling Stockholder represents that it has not prepared or had prepared on its
behalf or used or referred to, and agrees that it will not prepare or have
prepared on its behalf or use or refer to, any Issuer Free Writing Prospectus,
and has not distributed and will not distribute any written materials in
connection with the offer or sale of the Shares.
(f) The
Selling Stockholder will comply with the agreement contained in Section 9.
8. Additional Agreements of the
Company and the Underwriter.
(a) The
Company represents and agrees that, without the prior consent of the
Underwriter, it has not made and will not make any offer relating to the Shares
that would constitute a “free writing prospectus” as defined in Rule 405 under
the Act; the Underwriter represents and agrees that, without the prior consent
of the Company, it has not made and will not make any offer relating to the
Shares that would constitute a free writing prospectus; any
17
such free
writing prospectus the use of which has been consented to by the Company and the
Underwriter is listed on Schedule III(a) or
Schedule III(b)
hereto;
(b) The
Company has complied and will comply with the requirements of Rule 433 under the
Act applicable to any Issuer Free Writing Prospectus, including timely filing
with the Commission or retention where required and legending;
(c) The
Company agrees that if at any time following issuance of an Issuer Free Writing
Prospectus any event occurred or occurs as a result of which such Issuer Free
Writing Prospectus would conflict with the information in the Registration
Statement, the Pricing Disclosure Package or the Prospectus or would include an
untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements therein, in the light of the circumstances then
prevailing, not misleading, the Company will give prompt notice thereof to the
Underwriter and, if requested by the Underwriter, will prepare and furnish
without charge to the Underwriter an Issuer Free Writing Prospectus or other
document which will correct such conflict, statement or omission; provided, however, that this
agreement shall not apply to any statements or omissions in an Issuer Free
Writing Prospectus made in reliance upon and in conformity with information
furnished in writing to the Company by the Underwriter expressly for use
therein, it being understood and agreed that the only such information furnished
by the Underwriter consists of the information described as such in Section
11(c).
9. The
Company and each Selling Stockholder covenant and agree with one another and
with the Underwriter that (a) the Company will pay or cause to be paid the
following: (i) the fees, disbursements and expenses of the Company’s counsel and
accountants in connection with the registration of the Shares under the Act and
all other expenses in connection with the preparation, printing and filing of
the Registration Statement, any Preliminary Prospectus, any Issuer Free Writing
Prospectus and the Prospectus and amendments and supplements thereto and the
mailing and delivering of copies thereof to the Underwriter and dealers; (ii)
the cost of printing or producing any Agreement with the Underwriter, this
Agreement, the Blue Sky Memorandum, closing documents (including any
compilations thereof) and any other documents in connection with the offering,
purchase, sale and delivery of the Shares; (iii) all expenses in connection with
the qualification of the Shares for offering and sale under state securities
laws as provided in Section 8(b) hereof,
including the fees and disbursements of counsel for the Underwriter in
connection with such qualification and in connection with the Blue Sky survey;
and (iv) the filing fees incident to, and the fees and disbursements of counsel
for the Underwriter in connection with, securing any required review by the
Financial Industry Regulatory Authority, Inc. of the terms of the sale of the
Shares; and (b) the Company will pay or cause to be paid: (i) the
cost of preparing stock certificates; (ii) the cost and charges of any transfer
agent or registrar and (iii) all other costs and expenses incident to the
performance of the obligations of the Company and each Selling Stockholder
hereunder which are not otherwise specifically provided for in this Section 9 (other than
the underwriting discounts and commissions and transfer taxes, if any, relating
to the sale of Shares by each Selling Stockholder, which amounts shall be paid
by each such Selling Stockholder). It is understood, however, that
the Company shall bear the cost of any other matters not directly relating to
the sale and purchase of the Shares pursuant to this Agreement, and that, except
as provided in this Section 9, and Sections 11 and 14 hereof, the
Underwriter will pay all of its own costs and expenses, including the fees of
its counsel, stock
18
transfer
taxes on resale of any of the Shares by them, and any advertising expenses
connected with any offers they may make.
10. The
obligations of the Underwriter hereunder, as to the Shares to be delivered at
each Time of Delivery by the Selling Stockholders, shall be subject, in its
discretion, to the condition that all representations and warranties and other
statements of the Company and the Selling Stockholders herein are, at and as of
such Time of Delivery, true and correct, the condition that the Company and the
Selling Stockholders shall have performed all of its obligations hereunder
theretofore to be performed, and the following additional
conditions:
(a) The
Prospectus shall have been filed with the Commission pursuant to Rule 424(b)
within the applicable time period prescribed for such filing by the rules and
regulations under the Act and in accordance with Section 5(a) hereof;
all material required to be filed by the Company pursuant to Rule 433(d) under
the Act shall have been filed with the Commission within the applicable time
period prescribed for such filing by Rule 433; if the Company has
elected to rely upon Rule 462(b), the Rule 462(b) Registration Statement shall
have become effective by 10:00 P.M., Washington, D.C. time, on the date of this
Agreement; no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceeding for that
purpose shall have been initiated or threatened by the Commission; no stop order
suspending or preventing the use of the Prospectus or any Issuer Free Writing
Prospectus shall have been initiated or threatened by the Commission; and all
requests for additional information on the part of the Commission shall have
been complied with to your reasonable satisfaction;
(b) Willkie
Farr & Gallagher LLP, counsel for the Underwriter, shall have furnished to
you such written opinion or opinions (a draft of each such opinion is attached
as Annex II(a)
hereto), dated such Time of Delivery, with respect to such matters as you may
reasonably request, and such counsel shall have received such papers and
information as they may reasonably request to enable them to pass upon such
matters;
(c) Skadden, Arps, Slate,
Meagher & Flom LLP, counsel for the Company, shall have furnished to you
(i) their written opinion
as counsel for the Company (a draft of such opinion
is attached as Annex II(b)(i)); (ii) the tax opinion as special tax
counsel for the Company (a draft of such opinion is attached as Annex
II(b)(ii)), and (iii) the negative assurance letter as counsel for the Company
(a draft of such letter is attached as Annex II(b)(iii)), in each case dated such Time of
Delivery, in form and substance satisfactory to you;
(d) On
the date of the Prospectus at a time prior to the execution of this Agreement,
at 9:30 a.m., New York City time, on the effective date of any post-effective
amendment to the Registration Statement filed subsequent to the date of this
Agreement and also at each Time of Delivery, Ernst & Young LLP shall have
furnished to you a letter or letters, dated the respective dates of delivery
thereof, in form and substance satisfactory to you, to the effect set forth in
Annex III
hereto;
(e) (i) Neither
the Company nor any of its subsidiaries shall have sustained since the date of
the latest audited financial statements included in the Pricing Disclosure
Package and the Prospectus any loss or interference with its business from fire,
explosion, flood
19
or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as set forth or
contemplated in the Pricing Disclosure Package and the Prospectus, and (ii)
since the respective dates as of which information is given in the Pricing
Disclosure Package and the Prospectus there shall not have been any change in
the capital stock or long-term debt of the Company or any of its subsidiaries or
any change, or any development involving a prospective change, in or affecting
the general affairs, management, financial position, stockholders’ equity,
assets or results of operations of the Company or its subsidiaries, taken as a
whole, otherwise than as set forth or contemplated in the Pricing Disclosure
Package and the Prospectus, the effect of which, in any such case described in
clause (i) or (ii), is in the judgment of the Underwriter so material and
adverse as to make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Shares being delivered at such Time of Delivery
on the terms and in the manner contemplated in the Pricing Disclosure Package
and the Prospectus;
(f) On
or after the Applicable Time (i) no downgrading shall have occurred in the
rating accorded the Company’s debt securities by any “nationally recognized
statistical rating organization”, as that term is defined by the Commission for
purposes of Rule 436(g)(2) under the Act, and (ii) no such organization shall
have publicly announced that it has under surveillance or review, with possible
negative implications, its rating of any of the Company’s debt
securities;
(g) On
or after the Applicable Time there shall not have occurred any of the following:
(i) a suspension or material limitation in trading in securities generally on
the Exchange; (ii) a suspension or material limitation in trading in the
Company’s securities on the Exchange; (iii) a general moratorium on commercial
banking activities declared by either Federal or New York State authorities or a
material disruption in commercial banking or securities settlement or clearance
services in the United States; (iv) the outbreak or escalation of hostilities
involving the United States or the declaration by the United States of a
national emergency or war or (v) the occurrence of any other calamity or crisis
or any change in financial, political or economic conditions in the United
States or elsewhere, if the effect of any such event specified in clause (iv) or
(v) in the judgment of the Underwriter makes it impracticable or inadvisable to
proceed with the public offering or the delivery of the Shares being delivered
at such Time of Delivery on the terms and in the manner contemplated in the
Prospectus;
(h) The
Company has obtained and delivered to the Underwriter executed copies of a
lock-up agreement from each of the directors of the Company, the executive
officers of the Company and (i) FRIT Holdings LLC, (ii) PRIN Holding LLC,
(iii)Fort GB Holdings LLC, (iv) FABP (GAGACQ) LP, (v) Fortress Investment Fund
IV (Fund A) L.P., (vi) Fortress Investment Fund IV (Fund B) L.P., (vii) Fortress
Investment Fund IV (Fund C) L.P., (viii) Fortress Investment Fund IV (Fund D)
L.P., (ix) Fortress Investment Fund IV (Fund E) L.P., (x) Fortress Investment
Fund IV (Fund F) L.P., (xi) Fortress Investment Fund IV (Fund G) L.P., (xii)
Fortress Investment Fund IV (Coinvestment Fund A) L.P., (xiii) Fortress
Investment Fund IV (Coinvestment Fund B) L.P., (xiv) Fortress Investment Fund IV
(Coinvestment Fund C) L.P., (xv) Fortress Investment Fund IV (Coinvestment Fund
D) L.P., (xvi) Fortress Investment Fund IV (Coinvestment Fund F) L.P., (xvii)
Fortress Investment Fund IV (Coinvestment Fund G) L.P., (xviii) Fortress RIC
Coinvestment Fund LP, (xix) FBIF Holdings LLC, (xx) PRIN 2
20
Holding
LLC, (xxi) PRIN 3N Holding LLC, (xxii) Drawbridge DSO Securities LLC, and
(xxiii) Drawbridge OSO Securities LLC, in the form attached hereto as Annex I
which shall be in full force and effect;
(i) The
Shares at such Time of Delivery shall have been duly listed, subject to notice
of issuance, on the Exchange;
(j) The
Company shall have complied with the provisions of Section 6(c) hereof
with respect to the furnishing of prospectuses on the New York Business Day next
succeeding the date of this Agreement;
(k) The
Company and each Selling Stockholder shall have furnished or caused to be
furnished to you at such Time of Delivery
certificates of officers of the Company and of each Selling Stockholder,
respectively, satisfactory to you as to the accuracy of the representations and
warranties of the Company and each Selling Stockholder herein at and as of such
Time of Delivery, as to the performance by the Company of all of its obligations
hereunder to be performed at or prior to such Time of Delivery, and as to such
other matters as you may reasonably request, and the Company shall have
furnished or caused to be furnished certificates as to the matters set forth in
subsections (a) and (e) of this Section
10;
(l) T.
Andrew Smith, Executive Vice President, Secretary and General Counsel of the
Company, shall have furnished to you his written opinion (a draft of such
opinion is attached as Annex II(d) hereto),
dated such Time of Delivery, in form and substance satisfactory to you;
and
(m) David
Brooks, General Counsel of the Selling Stockholders, shall have furnished to you
his written opinion (a draft of such opinion is attached as Annex II(e) hereto),
dated such Time of Delivery, in form and substance satisfactory to
you.
11. (a) The
Company will indemnify and hold harmless the Underwriter against any losses,
claims, damages or liabilities, joint or several, to which the Underwriter may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, the Pricing Disclosure Package or the
Prospectus, or any amendment or supplement thereto, or any Issuer Free Writing
Prospectus or any “issuer information” filed or required to be filed pursuant to
Rule 433(d) under the Act, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and will reimburse
the Underwriter for any legal or other expenses reasonably incurred by the
Underwriter in connection with investigating or defending any such action or
claim as such expenses are incurred; provided, however, that the Company shall
not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in the Registration
Statement, the Pricing Disclosure Package or the Prospectus, or any amendment or
supplement thereto, or any Issuer Free Writing Prospectus, in reliance upon and
in conformity with written information furnished to the Company by the
Underwriter expressly for use therein,
21
it being
understood and agreed that the only such information furnished by the
Underwriter consists of the information described as such in Section
11(c).
(b) Each
Selling Stockholder will severally and not jointly indemnify and hold harmless
the Underwriter against any losses, claims, damages or liabilities, joint or
several, to which the Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement, the
Pricing Disclosure Package or the Prospectus, or any amendment or supplement
thereto or any Issuer Free Writing Prospectus or arise out of or are based upon
the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in the
Registration Statement, the Pricing Disclosure Package or the Prospectus, or any
such amendment or supplement thereto, or any Issuer Free Writing Prospectus, in
reliance upon and in conformity with written information furnished to the
Company by such Selling Stockholder concerning such Selling Stockholder
expressly for use therein; and will reimburse the Underwriter for any legal or
other expenses reasonably incurred by the Underwriter in connection with
investigating or defending any such action or claim as such expenses are
incurred; provided, however, that such Selling Stockholder shall not be liable
in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in the Registration Statement, the Pricing
Disclosure Package or the Prospectus, or any amendment or supplement thereto, or
any Issuer Free Writing Prospectus, in reliance upon and in conformity with
written information furnished to the Company by the Underwriter expressly for
use therein; provided, further, that the
indemnification and contribution liabilities of such Selling Stockholder
pursuant to this Agreement shall not exceed the product of the number of
Shares sold by such Selling Stockholder (including any Optional
Shares) and the public offering price per share of the Shares as set forth in
the Prospectus. The written information furnished to the Company by
such Selling Stockholder concerning such Selling Stockholder expressly for
use in the Registration Statement, the Pricing Disclosure Package or the
Prospectus, or any such amendment or supplement thereto, or any Issuer
Free Writing Prospectus is the information regarding such Selling
Stockholder set forth in the table appearing under the heading "Selling
Stockholders" and footnote 4 thereto.
(c) The
Underwriter will indemnify and hold harmless the Company and each Selling
Stockholder against any losses, claims, damages or liabilities to which the
Company or such Selling Stockholder may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement, the
Pricing Disclosure Package or the Prospectus, or any amendment or supplement
thereto, or any Issuer Free Writing Prospectus or arise out of or are based upon
the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in the
Registration Statement, the Pricing Disclosure Package or the Prospectus or any
amendment or supplement thereto, or any Issuer Free Writing Prospectus,
in
22
reliance
upon and in conformity with written information furnished to the Company or a
Selling Stockholder by the Underwriter expressly for use therein; and will
reimburse the Company or a Selling Stockholder for any legal or other expenses
reasonably incurred by the Company or such Selling Stockholder in connection
with investigating or defending any such action or claim as such expenses are
incurred. The Company and each Selling Stockholder hereby acknowledges that the
only information that the Underwriter has furnished to the Company or such
Selling Stockholder for use in the Registration Statement, the Pricing
Disclosure Package or the Prospectus or any amendment or supplement thereto, or
any Issuer Free Writing Prospectus, are the statements in the first and second
sentence of the fourth paragraph (relating to concessions and reallowances) and
the second sentence of the eleventh paragraph and the twelfth paragraph (related
to price stabilization, short sales and purchase to cover positions to cover
positions created by short sales) under the caption “Underwriting” in the
Prospectus.
(d) Promptly
after receipt by an indemnified party under subsection (a), (b) or (c) above of
notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party under such
subsection, notify the indemnifying party in writing of the commencement
thereof; but the failure to so notify the indemnifying party shall not relieve
it from any liability which it may have to any indemnified party otherwise than
under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation. 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 judgment (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.
(e) If
the indemnification provided for in this Section 11 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a), (b) or (c) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Selling Stockholders on the
one hand and the Underwriter on the other from the offering of the
Shares. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the indemnified
party failed to give the notice required under subsection (d) above, then each
indemnifying party shall contribute to such
23
amount
paid or payable by such indemnified party in such proportion as is appropriate
to reflect not only such relative benefits but also the relative fault of the
Company and the Selling Stockholders on the one hand and the Underwriter 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 benefits
received by the Company and the Selling Stockholders on the one hand and the
Underwriter on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering (before deducting expenses) received by the
Selling Stockholders bear to the total underwriting discounts and commissions
received by the Underwriter, in each case as set forth in the table on the cover
page of the Prospectus. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company and the Selling Stockholders on
the one hand or the Underwriter on the other and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company, each Selling Stockholder and the
Underwriter agree that it would not be just and equitable if contributions
pursuant to this subsection (e) were determined by pro rata allocation or by any
other method of allocation which does not take account of the equitable
considerations referred to above in this subsection (e). 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
subsection (e) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
any such action or claim. Notwithstanding the provisions of this
subsection (e), the Underwriter shall not be required to contribute any amount
in excess of the amount by which the total price at which the Shares
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which the Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(f) The
obligations of the Company and each Selling Stockholder under this Section 11 shall be
in addition to any liability which the Company and such Selling Stockholder may
otherwise have and shall extend, upon the same terms and conditions, to each
person, if any, who controls the Underwriter within the meaning of the Act; and
the obligations of the Underwriter under this Section 11 shall be
in addition to any liability which the Underwriter may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of the
Company (including any person who, with his or her consent, is named in the
Registration Statement as about to become a director of the Company) and to each
person, if any, who controls the Company within the meaning of the
Act.
12. The
respective indemnities, agreements, representations, warranties and other
statements of the Company, each Selling Stockholder and the Underwriter, as set
forth in this Agreement or made by or on behalf of them, respectively, pursuant
to this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of the Underwriter or any controlling person of the Underwriter, or the Company,
or any officer or director or controlling person of the Company, or a Selling
Stockholder, and shall survive delivery of and payment for the
Shares.
24
13. If
for any reason any Shares are not delivered by or on behalf of a Selling
Stockholder as provided herein, such Selling Stockholder will reimburse the
Underwriter for all out-of-pocket expenses approved in writing by you, including
fees and disbursements of counsel, reasonably incurred by the Underwriter in
making preparations for the purchase, sale and delivery of the Shares not so
delivered, but the Selling Stockholders shall then be under no further liability
to the Underwriter in respect of the Shares not so delivered except as provided
in Sections 9
and 11
hereof.
14. All
statements, requests, notices and agreements hereunder shall be in writing, and
if to the Underwriter shall be delivered or sent by mail, telex or facsimile
transmission to Merrill Lynch, Pierce, Fenner & Smith Incorporated, One
Bryant Park, New York, New York 10036, Facsimile: (646) 855 3073,
Attention: Syndicate Department, with a copy to Merrill Lynch, Pierce, Fenner
& Smith Incorporated, One Bryant Park, New York, New York 10036,
Facsimile: (212) 230-8730, Attention: ECM Legal; with a
copy to Willkie Farr & Gallagher LLP, 787 Seventh Avenue, New York, New York
10012, attention: Steven A. Seidman and Cristopher Greer; and if to the Company
shall be delivered or sent by mail, telex or facsimile transmission to the
address of the Company set forth in the Registration Statement, Attention:
Secretary, with a copy to Skadden, Arps, Slate, Meagher & Flom LLP, Four
Times Square, New York, New York 10036-6522, attention: Joseph
Coco. Any such statements, requests, notices or agreements shall take
effect upon receipt thereof. Notices to the Selling Stockholders
shall be given as set forth under the name of such Selling Stockholder on
Schedule 2 hereto.
15. This
Agreement shall be binding upon, and inure solely to the benefit of, the
Underwriter, the Company, each Selling Stockholder and, to the extent provided
in Sections 11
and 12 hereof,
the officers and directors of the Company and each person who controls the
Company or the Underwriter or any Selling Stockholder, and their respective
heirs, executors, administrators, successors and assigns, and no other person
shall acquire or have any right under or by virtue of this
Agreement. No purchaser of any of the Shares from the Underwriter
shall be deemed a successor or assign by reason merely of such
purchase.
16. Each
Selling Stockholder acknowledges and agrees that (i) the purchase and sale
of the Shares pursuant to this Agreement is an arm’s-length commercial
transaction between each Selling Stockholder, on the one hand, and the
Underwriter, on the other, (ii) in connection therewith and with the
process leading to such transaction the Underwriter is acting solely as a
principal and not the agent or fiduciary of the Company, (iii) the
Underwriter has not assumed an advisory or fiduciary responsibility in favor of
the Company with respect to the offering contemplated hereby or the process
leading thereto (irrespective of whether the Underwriter has advised or is
currently advising the Company on other matters) or any other obligation to the
Company except the obligations expressly set forth in this Agreement and
(iv) each Selling Stockholder has consulted its own legal and financial
advisors to the extent deemed appropriate. Each Selling Stockholder
agrees that it will not claim that the Underwriter has rendered advisory
services of any nature or respect, or owes a fiduciary or similar duty to the
Company, in connection with such transaction or the process leading
thereto.
17. Time
shall be of the essence of this Agreement. As used herein, the term
“business day” shall
mean any day when the Commission’s office in Washington, D.C. is open for
business.
25
18. This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York.
19. This
Agreement may be executed by any one or more of the parties hereto in any number
of counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same instrument.
20. Notwithstanding
anything herein to the contrary, the Company and the Selling Stockholders are
authorized to disclose to any persons the U.S. federal and state income tax
treatment and tax structure of the potential transaction and all materials of
any kind (including tax opinions and other tax analyses) provided to the Company
and the Selling Stockholders relating to that treatment and structure, without
the Underwriter imposing any limitation of any kind. However, any information
relating to the tax treatment and tax structure shall remain confidential (and
the foregoing sentence shall not apply) to the extent necessary to enable any
person to comply with securities laws. For this purpose, “tax structure” is limited to
any facts that may be relevant to that treatment.
If the
foregoing is in accordance with your understanding, please sign and return to us
one for the Company, the Selling Stockholders and the Underwriter plus one for
each counsel, if any counterparts hereof, and upon the acceptance hereof by you,
this letter and such acceptance hereof shall constitute a binding agreement
among each of the Underwriter, each Selling Stockholder and the
Company.
26
|
Very
truly yours,
|
|
FORT
GB HOLDINGS LLC
|
|||||
|
By:
|
/s/
Randal Nardone
|
||||
|
Name:
|
Randal
Nardone
|
||||
|
Title:
|
Chief
Operating Officer
|
||||
|
FRIT
HOLDINGS LLC
|
|||||
|
By:
|
/s/
Randal Nardone
|
||||
|
Name:
|
Randal
Nardone
|
||||
|
Title:
|
Chief
Operating Officer
|
||||
|
FABP
(GAGACQ) LP
|
|||||
|
By:
|
Fortress
Fund MM II LLC,
|
||||
|
its
General Partner
|
|||||
|
By:
|
/s/
Randal Nardone
|
||||
|
Name:
|
Randal
Nardone
|
||||
|
Title:
|
Chief
Operating Officer
|
||||
|
FBIF
HOLDINGS LLC
|
|||||
|
By:
|
/s/
Randal Nardone
|
||||
|
Name:
|
Randal
Nardone
|
||||
|
Title:
|
Secretary
|
||||
|
DRAWBRIDGE
DSO SECURITIES LLC
|
|||||
|
By:
|
/s/
Constantine M. Dakolias
|
||||
|
Name:
|
Constantine
M. Dakolias
|
||||
|
Title:
|
President
|
||||
|
DRAWBRIDGE
OSO SECURITIES LLC
|
|||||
|
By:
|
/s/
Constantine M. Dakolias
|
||||
|
Name:
|
Constantine
M. Dakolias
|
||||
|
Title:
|
President
|
||||
|
BROOKDALE
SENIOR LIVING INC.
|
|||||
|
By:
|
/s/
T. Andrew Smith
|
||||
|
Name:
|
T.
Andrew Smith
|
||||
|
Title:
|
Executive
Vice President
|
||||
Accepted
as of the date hereof:
MERRILL
LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
|
By:
|
/s/ James P. Cooney Jr. | ||||
|
Name:
|
James
P. Cooney Jr.
|
||||
|
Title:
|
Managing
Director
|
||||