CUZ 8-K
Cousins Properties Inc (CUZ)
8-K
2025-06-06
For: 2025-06-06
View Original
Added on
April 09, 2026
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 6, 2025
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation) (Commission File Number) (IRS Employer Identification Number)
(Address of principal executive offices, including zip code)
(404 ) 407-1000
Registrant’s telephone number, including area code:
Not applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions
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)) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | |||||||||||||||
| ("NYSE") | |||||||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01. Entry Into a Material Definitive Agreement.
On June 6, 2025, Cousins Properties LP (the “Operating Partnership”), the operating partnership and wholly owned subsidiary of Cousins Properties Incorporated (the “Company”), issued $500,000,000 in aggregate principal amount of 5.250% Senior Notes due 2030 (the “Notes”), which mature on July 15, 2030, pursuant to an indenture, dated as of May 8, 2024 (as amended and supplemented by a supplemental indenture (the “Supplemental Indenture”), dated as of June 6, 2025, the “Indenture”), by and among the Operating Partnership, the Company and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”). The Notes are fully and unconditionally guaranteed by the Company. Interest on the Notes is payable semi-annually on January 15 and July 15 of each year, commencing January 15, 2026. The Notes will bear interest at a rate of 5.250% per year.
The Indenture contains certain covenants that, among other things, limit the ability of the Company and its subsidiaries to incur secured and unsecured debt and the ability of the Operating Partnership, the Company and any subsidiary guarantors to consummate a merger, consolidation or sale of all or substantially all of their assets, in each case, subject to certain exceptions. In addition, the Indenture will require the Company and its subsidiaries to maintain at all times total unencumbered assets of not less than 150% of total unsecured debt. These covenants are subject to a number of important exceptions and qualifications. The Indenture also provides for customary events of default which, if any of them occurs, would permit or require the principal of and accrued interest on the Notes to become, or to be declared, due and payable.
Prior to June 15, 2030, the Operating Partnership may redeem the Notes in whole at any time or in part from time to time, at the Operating Partnership’s option and sole discretion, at a redemption price equal to the greater of:
•100% of the principal amount of the Notes being redeemed; and
•a make-whole premium calculated in accordance with the Indenture,
plus, in either case, accrued and unpaid interest thereon to the redemption date.
Notwithstanding the foregoing, on or after June 15, 2030, the redemption price will be equal to 100% of the principal amount of the Notes being redeemed, plus accrued and unpaid interest thereon to the redemption date.
The Company will use the net proceeds from the Notes to repay the outstanding principal amount of its senior notes due 2025 and the remainder to repay borrowings under its credit facility and for general corporate purposes.
The Notes were offered by means of a prospectus supplement and accompanying prospectus filed with the Securities and Exchange Commission. Copies of the Indenture and the Supplemental Indenture are attached hereto as Exhibits 4.1 and 4.2, respectively, and are incorporated herein by reference.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth under Item 1.01, “Entry Into a Material Definitive Agreement” is incorporated herein by reference.
Item 8.01. Other Events.
On May 28, 2025, the Operating Partnership and the Company entered into an agreement (the “Underwriting Agreement”) among the Operating Partnership, the Company, Wells Fargo Securities, LLC, BofA Securities, Inc., and TD Securities (USA) LLC, as representatives of the underwriters listed on Schedule 1 thereto (the “Underwriters”). Pursuant to the Underwriting Agreement, the Operating Partnership agreed to sell and the Underwriters agreed to purchase from the Operating Partnership, subject to and upon the terms and conditions set forth in the Underwriting Agreement, the Notes.
A copy of the Underwriting Agreement is attached hereto as Exhibit 1.1 and is incorporated herein by reference. The foregoing summary does not purport to be complete and is qualified in its entirety by reference to the Underwriting Agreement.
The Company is filing this Current Report on Form 8-K so as to file with the Securities and Exchange Commission certain items that are to be incorporated by reference into a Registration Statement on Form S-3 (Registration Nos. 333-279209 and 333-279209-01).
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits:
| Exhibit No. | Description | |||||||
| 1.1 | ||||||||
| 4.1 | ||||||||
| 4.2 | ||||||||
| 4.3 | ||||||||
| 5.1 | ||||||||
| 8.1 | ||||||||
| 8.2 | ||||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| COUSINS PROPERTIES INCORPORATED | ||||||||
| (Registrant) | ||||||||
Date: June 6, 2025 | By: | /s/ Pamela F. Roper | ||||||
| Pamela F. Roper | ||||||||
| Executive Vice President, General Counsel, and Corporate Secretary | ||||||||
Exhibit 1.1
Execution Version
$500,000,000
COUSINS PROPERTIES LP, AS ISSUER
COUSINS PROPERTIES INCORPORATED, AS GUARANTOR
5.250% Senior Notes due 2030
Underwriting Agreement
May 28, 2025
Wells Fargo Securities, LLC
BofA Securities, Inc.
TD Securities (USA) LLC
As Representatives of the
several Underwriters listed
in Schedule 1 hereto
c/o Wells Fargo Securities, LLC
550 South Tryon Street
Charlotte, North Carolina 28202
c/o BofA Securities, Inc.
One Bryant Park, 11th Floor
New York, New York 10036
c/o TD Securities (USA) LLC
1 Vanderbilt Avenue, 11th Floor
New York, New York, 10017
Ladies and Gentlemen:
Cousins Properties LP, a Delaware limited partnership (the “Operating Partnership”), proposes to issue and sell to the several Underwriters listed in Schedule 1 hereto (the “Underwriters”), for whom you are acting as representatives (the “Representatives”), $500,000,000 principal amount of its 5.250% Senior Notes due 2030 (the “Securities”). The Securities will be issued pursuant to an Indenture, dated as of May 8, 2024 (the “Base Indenture”), among the Operating Partnership, Cousins Properties Incorporated, a Georgia corporation (the “Company” and, together with the Operating Partnership, the “Transaction Entities”), as guarantor, and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”), as amended by a Supplemental Indenture to be dated as of June 6, 2025 (the “Supplemental Indenture” and together with the Base Indenture, the “Indenture”), and will be guaranteed on a senior unsecured basis by the Company (the “Guarantee”).
The Transaction Entities hereby confirm their agreement with the several Underwriters concerning the purchase and sale of the Securities, as follows:
1. Registration Statement. The Transaction Entities have prepared and filed with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Securities Act”), a registration statement on Form S-3 (File No. 333-279209), including a prospectus, relating to the Securities. Such registration statement, as amended at the time it became effective, including the information, if any, deemed pursuant to Rule 430A, 430B or 430C under the Securities Act to be part of the registration statement at the time of its effectiveness (“Rule 430 Information”), is referred to herein as the “Registration Statement”; and as used herein, the term “Preliminary Prospectus” means each prospectus included in such registration statement (and any amendments thereto) before effectiveness, any prospectus filed with the Commission pursuant to Rule 424(a) under the Securities Act and the prospectus included in the Registration Statement at the time of its effectiveness that omits Rule 430 Information, and the term “Prospectus” means the prospectus in the form first used (or made available upon request of purchasers pursuant to Rule 173 under the Securities Act) in connection with confirmation of sales of the Securities. If the Transaction Entities have filed an abbreviated registration statement pursuant to Rule 462(b) under the Securities Act (the “Rule 462 Registration Statement”), then any reference herein to the term “Registration Statement” shall be deemed to include such Rule 462 Registration Statement. Any reference in this agreement (this “Agreement”) 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 Securities Act, as of the effective date of the Registration Statement or the date of such Preliminary Prospectus or the Prospectus, as the case may be, and any reference to “amend,” “amendment” or “supplement” with respect to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any documents filed after such date under the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Exchange Act”) that are deemed to be incorporated by reference therein. Capitalized terms used but not defined herein shall have the meanings given to such terms in the Registration Statement and the Prospectus.
At or prior to 2:30 P.M., the time when sales of the Securities were first made (the “Time of Sale”), the Transaction Entities had prepared the following information (collectively, the “Time of Sale Information”): a Preliminary Prospectus dated May 28, 2025, and each “free-writing prospectus” (as defined pursuant to Rule 405 under the Securities Act) listed on Annex A hereto.
2. Purchase and Sale of the Securities.
(a) The Operating Partnership agrees to issue and sell the Securities to the several Underwriters as provided in this Agreement, and each Underwriter, on the basis of the representations, warranties and agreements set forth herein and subject to the conditions set forth herein, agrees, severally and not jointly, to purchase from the Operating Partnership the respective principal amount of Securities set forth opposite such Underwriter’s name in Schedule 1 hereto at a price equal to 99.387% of the principal
2
amount thereof plus accrued interest, if any, from June 6, 2025 to the Closing Date (as defined below). The Operating Partnership will not be obligated to deliver any of the Securities except upon payment for all the Securities to be purchased as provided herein.
(b) The Operating Partnership understands that the Underwriters intend to make a public offering of the Securities as soon after the effectiveness of this Agreement as in the judgment of the Representatives is advisable, and initially to offer the Securities on the terms set forth in the Time of Sale Information. The Operating Partnership acknowledges and agrees that the Underwriters may offer and sell Securities to or through any affiliate of an Underwriter and that any such affiliate may offer and sell Securities purchased by it to or through any Underwriter.
(c) Payment for and delivery of the Securities will be made at the offices of Hogan Lovells US LLP, 555 Thirteenth Street, NW, Washington, DC 20004 at 10:00 A.M., New York City time, on June 6, 2025, or at such other time or place on the same or such other date, not later than the fifth business day thereafter, as the Representatives and the Operating Partnership may agree upon in writing. The time and date of such payment and delivery is referred to herein as the “Closing Date.”
(d) Payment for the Securities shall be made by wire transfer in immediately available funds to the account(s) specified by the Operating Partnership to the Representatives against delivery to the nominee of The Depository Trust Company (“DTC”), for the account of the Underwriters, of one or more global notes representing the Securities (collectively, the “Global Note”), with any transfer taxes payable in connection with the sale of the Securities duly paid by the Operating Partnership. The Global Note will be made available for inspection by the Representatives not later than 1:00 P.M., New York City time, on the business day prior to the Closing Date.
(e) The Transaction Entities acknowledge and agree that each Underwriter is acting solely in the capacity of an arm’s length contractual counterparty to the Transaction Entities with respect to the offering of Securities contemplated hereby (including in connection with determining the terms of the offering) and not as a financial advisor or a fiduciary to, or an agent of, the Transaction Entities or any other person. Additionally, neither the Representatives nor any other Underwriter is advising the Transaction Entities or any other person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction. The Transaction Entities shall consult with their own advisors concerning such matters and shall be responsible for making their own independent investigation and appraisal of the transactions contemplated hereby, and the Underwriters shall have no responsibility or liability to either of the Transaction Entities with respect thereto. Any review by the Representatives or any Underwriter of the Transaction Entities, the transactions contemplated hereby or other matters relating to such transactions will be performed solely for the benefit of the Representatives or such Underwriter, as the case may be, and shall not be on behalf of either of the Transaction Entities, as the case may be, or any other person.
3
3. Representations and Warranties of the Transaction Entities. Each of the Transaction Entities jointly and severally represents and warrants to each Underwriter that:
(a) Preliminary Prospectus. No order preventing or suspending the use of any Preliminary Prospectus has been issued by the Commission, and each Preliminary Prospectus, at the time of filing thereof, complied in all material respects with the Securities Act and did 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; provided that the Transaction Entities make no representation or warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to any Underwriter furnished to the Transaction Entities in writing by such Underwriter through the Representatives expressly for use in any Preliminary Prospectus.
(b) Time of Sale Information. The Time of Sale Information, at the Time of Sale did not, and at the Closing Date 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; provided that the Transaction Entities make no representation or warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to any Underwriter furnished to the Transaction Entities in writing by such Underwriter through the Representatives expressly for use in the Preliminary Prospectus, the Time of Sale Information or the Prospectus. No statement of material fact included in the Prospectus has been omitted from the Time of Sale Information and no statement of material fact included in the Time of Sale Information that is required to be included in the Prospectus has been omitted therefrom.
(c) Issuer Free Writing Prospectus. The Transaction Entities (including their agents and representatives, other than the Underwriters in their capacity as such) have not prepared, made, used, authorized, approved or referred to and will not prepare, make, use, authorize, approve or refer to any “written communication” (as defined in Rule 405 under the Securities Act) that constitutes an offer to sell or solicitation of an offer to buy the Securities (each such communication by the Transaction Entities or their agents and representatives (other than a communication referred to in clauses (i), (ii) and (iii) below) an “Issuer Free Writing Prospectus”) other than (i) any document not constituting a prospectus pursuant to Section 2(a)(10)(a) of the Securities Act or Rule 134 under the Securities Act, (ii) the Preliminary Prospectus, (iii) the Prospectus, (iv) the documents listed on Annex A hereto, including a Pricing Term Sheet substantially in the form of Annex B hereto, which constitute part of the Time of Sale Information and (v) any electronic road show or other written communications, in each case approved in writing in advance by the Representatives. Each such Issuer Free Writing Prospectus complies in all material respects with the Securities Act, has been or will be (within the time period specified in Rule 433) filed in accordance with the Securities Act (to the extent required thereby) and, when taken together with the Preliminary Prospectus accompanying, or delivered prior to delivery of, such Issuer Free Writing Prospectus, at the Time of Sale,
4
did not, and at the Closing Date 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; provided that the Transaction Entities make no representation or warranty with respect to any statements or omissions made in each such Issuer Free Writing Prospectus in reliance upon and in conformity with information relating to any Underwriter furnished to the Transaction Entities in writing by such Underwriter through the Representatives expressly for use in any Issuer Free Writing Prospectus.
(d) Registration Statement and Prospectus. The Registration Statement is an “automatic shelf registration statement” as defined under Rule 405 of the Securities Act that has been filed with the Commission not earlier than three years prior to the date hereof; and no notice of objection of the Commission to the use of such registration statement or any post-effective amendment thereto pursuant to Rule 401(g)(2) under the Securities Act has been received by the Transaction Entities. No order suspending the effectiveness of the Registration Statement has been issued by the Commission and no proceeding for that purpose or pursuant to Section 8A of the Securities Act against the Transaction Entities or related to the offering has been initiated or, to the knowledge of the Transaction Entities, threatened by the Commission; as of the applicable effective date of the Registration Statement and any amendment thereto, the Registration Statement complied and will comply in all material respects with the Securities Act and the Trust Indenture Act of 1939, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Trust Indenture 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; and as of the date of the Prospectus and any amendment or supplement thereto and as of the Closing Date, the Prospectus 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; provided that the Transaction Entities make no representation or warranty with respect to (i) that part of the Registration Statement that constitutes the Statement of Eligibility and Qualification (Form T-1) of the Trustee under the Trust Indenture Act or (ii) any statements or omissions made in reliance upon and in conformity with information relating to any Underwriter furnished to the Transaction Entities in writing by such Underwriter through the Representatives expressly for use in the Registration Statement and the Prospectus and any amendment or supplement thereto.
(e) Incorporated Documents. The documents incorporated by reference in each of the Registration Statement, the Prospectus and the Time of Sale Information, 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, and none of such documents contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; and any further documents so filed and incorporated by reference in the Registration Statement, the Prospectus or the Time of Sale Information, when such documents become effective or are filed with the
5
Commission, as the case may be, will conform in all material respects to the requirements of the Securities Act or the Exchange Act, as applicable, and will not contain any 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.
(f) Financial Statements. The consolidated financial statements of the Company included or incorporated by reference in each of the Registration Statement, the Time of Sale Information and the Prospectus, together with the related schedules and notes, present fairly, in all material respects, the financial position of the Company, its consolidated subsidiaries and its joint ventures (both consolidated and unconsolidated) at the dates indicated and the results of their operations and cash flows for the periods specified; and, except as may be stated in the related notes thereto, said financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”) applied on a consistent basis throughout the periods involved; provided, however, that those financial statements of the Company included or incorporated by reference in the Registration Statement, the Time of Sale Information and the Prospectus that are unaudited are subject to year-end adjustments and do not contain all footnotes that may be required under GAAP for annual financial statements. The supporting schedules, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein. Amounts included in the supporting schedules have been compiled or derived from information that has been prepared in accordance with GAAP. The selected financial data and the summary financial information included in the Time of Sale Information and the Prospectus present fairly, in all material respects, the information shown therein and have been compiled on a basis consistent with that of the audited and unaudited financial statements, as the case may be, included or incorporated by reference in each of the Registration Statement, the Time of Sale Information and the Prospectus. Without limiting the foregoing, the Company has properly reflected all impairment losses or charges on a timely basis in accordance with GAAP and no such impairment losses or charges exist that should have been reflected in the Company’s consolidated financial statements in accordance with GAAP that were not so reflected. There are currently no impairment losses or charges that would need to be reflected in the Company’s consolidated financial statements in accordance with GAAP in its periodic reports to be filed in accordance with the Exchange Act that have not already been disclosed in previously filed reports. All disclosures contained in the Registration Statement, the Time of Sale Information and the Prospectus, or incorporated by reference therein, regarding “non-GAAP financial measures” (as such term is defined by the rules and regulations of the Commission) comply with Regulation G of the Exchange Act and Item 10 of Regulation S-K of the Securities Act, to the extent applicable. The interactive data in eXtensible Business Reporting Language incorporated by reference in the Registration Statement, the Time of Sale Information and the Prospectus fairly presents the information called for in all material respects and has been prepared in accordance with the Commission’s rules and guidelines applicable thereto.
6
(g) No Material Adverse Change. Since the respective dates as of which information is given or incorporated by reference in each of the Registration Statement, the Time of Sale Information and the Prospectus (in each case as supplemented or amended), (i) there has been no 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 its Subsidiaries (as defined below), considered as one enterprise, including, but not limited to, the impact of any material adverse change in any joint venture, whether or not arising in the ordinary course of business (a “Material Adverse Effect”), (ii) without limiting the foregoing, none of the Operating Partnership, the Company or any of its Subsidiaries or Joint Ventures (as defined below) has sustained any material loss or interference with its assets, businesses or properties (whether owned or leased) from fire, explosion, earthquake, flood or other calamity, whether or not covered by insurance, that would reasonably be expected to result in a Material Adverse Effect, (iii) there have been no transactions entered into by the Operating Partnership, the Company or any of its Subsidiaries or Joint Ventures, other than those in the ordinary course of business, which are material with respect to the Company and its Subsidiaries considered as one enterprise and (iv) there has been no obligation or liability, contingent or otherwise, directly or indirectly incurred by the Operating Partnership, the Company or any Subsidiary or Joint Venture that would reasonably be expected to have a Material Adverse Effect, except in each case as otherwise disclosed in each of the Registration Statement, the Time of Sale Information and the Prospectus.
(h) Organization and Good Standing of the Operating Partnership. The Operating Partnership has been duly formed and is validly existing as a limited partnership in good standing under the laws of the State of Delaware, with full power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement, the Time of Sale Information and the Prospectus and to enter into and perform its obligations under this Agreement; and the Operating Partnership is duly qualified to transact business and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure, individually or in the aggregate, so to qualify or to be in good standing would not reasonably be expected to result in a Material Adverse Effect.
(i) Organization and Good Standing of the Company. The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Georgia and has corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement, the Time of Sale Information and the Prospectus and to enter into and perform its obligations under this Agreement; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure, individually or in the aggregate, so to qualify or to be in good standing would not reasonably be expected to result in a Material Adverse Effect.
7
(j) Organization and Good Standing of Subsidiaries. The Company represents and warrants that set forth on Schedule 2 are each of its subsidiaries (other than the Operating Partnership) that are material, financial or otherwise, to the earnings, business affairs or business prospects of the Company and its subsidiaries considered as one enterprise (each a “Subsidiary” and collectively, the “Subsidiaries”) and set forth on Schedule 3 are each of its joint ventures (that are not also Subsidiaries) that are material, financial or otherwise, to the earnings, business affairs or business prospects of the Company and its subsidiaries considered as one enterprise (each a “Joint Venture” and collectively, the “Joint Ventures”). Each Subsidiary and Joint Venture has been duly organized and is validly existing as a corporation, limited liability company, limited partnership or limited liability limited partnership, as the case may be, in good standing under the laws of the jurisdiction of its incorporation, organization or formation, except where the failure so to qualify or to be in good standing would not reasonably be expected to result in a Material Adverse Effect, has corporate or other applicable entity, power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement, the Time of Sale Information and the Prospectus and is duly qualified as a foreign corporation or other applicable entity to transact business and is in good standing in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure so to qualify or to be in good standing would not reasonably be expected to result in a Material Adverse Effect; except as otherwise disclosed in the Registration Statement, the Time of Sale Information and the Prospectus, all of the issued and outstanding capital stock or other applicable entity interests, which are owned directly or indirectly by the Company, of each such Subsidiary and Joint Venture has been duly authorized and validly issued, is fully paid and, in the case of capital stock, non-assessable and, in the case of any other equity interests, exempts the holder thereof from any expense or liability beyond the amount of such holder’s investment except as otherwise described in the Registration Statement, the Time of Sale Information and the Prospectus or as would not reasonably be expected to result in a Material Adverse Effect, and, each of the shares of capital stock or other applicable entity interests owned, directly or indirectly by the Company, is owned by the Company, directly or through subsidiaries, free and clear of any security interest, mortgage, pledge, lien, encumbrance, claim or equity; none of the outstanding shares of capital stock or other applicable entity interests, which are owned directly or indirectly by the Company, of any Subsidiary or Joint Venture was issued in violation of the preemptive, co-sale, registration, right of first refusal or similar rights of any securityholder of such Subsidiary or Joint Venture or any other person. The only Subsidiaries of the Company are (a) the Subsidiaries listed on Schedule 2 hereto and the Joint Ventures listed on Schedule 3 hereto and (b) certain other subsidiaries which, considered in the aggregate as a single subsidiary, do not constitute a “significant subsidiary” as defined in Rule 1-02 of Regulation S-X. The Company does not have any “significant subsidiaries” other than the Operating Partnership.
(k) Capitalization of the Company. The authorized, issued and outstanding capital stock of the Company is as set forth in the Time of Sale Information and the Prospectus under the heading “Capitalization” as of the date set forth therein. The shares
8
of issued and outstanding capital stock of the Company have been duly authorized and validly issued and are fully paid and non-assessable.
(l) Capitalization of the Operating Partnership. All of the issued and outstanding units of limited partnership interest in the Operating Partnership (the “Units”) have been duly authorized and validly issued, and have been offered and sold in compliance with all applicable laws (including, without limitation, federal or state securities laws). The Company is the direct or indirect owner of all of the Units.
(m) Due Authorization. Each of the Transaction Entities has the corporate or partnership power and authority to execute and deliver this Agreement, the Securities and the Indenture (including each Guarantee set forth therein) (collectively, the “Transaction Documents”) and to perform its obligations hereunder and thereunder; and all action required to be taken for the due and proper authorization, execution and delivery by each of them of each of the Transaction Documents to which it is a party and the consummation of the transactions contemplated hereby and thereby has been duly and validly taken.
(n) The Indenture. The Base Indenture has been duly authorized, executed and delivered by each of the Transaction Entities and constitutes a valid and legally binding agreement of each of the Transaction Entities, enforceable against each of the Transaction Entities in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally or by equitable principles relating to enforceability (collectively, the “Enforceability Exceptions”). Upon effectiveness of the Registration Statement, the Base Indenture was duly qualified under the Trust Indenture Act. The Supplemental Indenture has been duly authorized by each of the Transaction Entities and, on the Closing Date, will be duly executed and delivered by each of the Transaction Entities and, when duly executed and delivered in accordance with its terms by each of the parties thereto, will constitute a valid and legally binding agreement of each of the Transaction Entities, enforceable against each of the Transaction Entities in accordance with its terms, subject to the Enforceability Exceptions. On the Closing Date, the Indenture will conform in all material respects to the requirements of the Trust Indenture Act.
(o) The Securities and the Guarantee. The Securities have been duly authorized by the Operating Partnership and, when duly executed, authenticated, issued and delivered as provided in the Indenture and paid for as provided herein, will be duly and validly issued and outstanding and will constitute valid and legally binding obligations of the Operating Partnership, enforceable against the Operating Partnership in accordance with their terms, subject to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture; and the Guarantee has been duly authorized by the Company and, when the Securities have been duly executed, authenticated, issued and delivered as provided in the Indenture and paid for as provided herein, will be a valid and legally binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture.
9
(p) Underwriting Agreement. This Agreement has been duly authorized, executed and delivered by each of the Transaction Entities.
(q) Descriptions of the Transaction Documents. Each Transaction Document conforms in all material respects to the description thereof contained in each of the Registration Statement, the Time of Sale Information and the Prospectus.
(r) No Violations, Defaults and Conflicts. None of the Operating Partnership, the Company or any of its Subsidiaries or Joint Ventures is (i) in violation of its charter, by-laws, operating agreement, partnership agreement or other applicable organizational documents, as the case may be; or (ii) in default in the performance or observance nor has any event occurred which with notice, lapse of time or both would constitute a default in the 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 the Operating Partnership, the Company or any of its Subsidiaries or any Joint Venture is a party or by which it or any of them may be bound, or to which any of the property or assets of the Operating Partnership, the Company or any Subsidiary or any Joint Venture is subject (collectively, “Agreements and Instruments”), except, in the case of clause (ii) above, for such violations or defaults that would not reasonably be expected to result in a Material Adverse Effect; and the execution, delivery and performance of the Transaction Documents and the consummation of the transactions contemplated herein and in each of the Registration Statement, the Time of Sale Information and the Prospectus and compliance by the Transaction Entities with their obligations hereunder have been duly authorized by all necessary corporate action, 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 property or assets of the Operating Partnership, the Company or any Subsidiary or Joint Venture pursuant to, the Agreements and Instruments (except for such conflicts, breaches, defaults or Repayment Events or liens, charges or encumbrances that would not reasonably be expected to result in a Material Adverse Effect), nor will such action result in any violation of (Y) the provisions of the charter, by-laws, operating agreement, partnership agreement or other applicable organizational documents, as the as may be, of the Operating Partnership, the Company or any Subsidiary or Joint Venture or (Z) 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 Joint Venture or any of their assets, properties or operations except, in the case of clause (Z), for such violations that would not reasonably be expected to result in a Material Adverse Effect. The Operating Partnership, the Company and each Subsidiary and Joint Venture is currently in compliance with all laws, statutes, rules, regulations, judgments, orders, writs or decrees of any government, government instrumentality or court, domestic or foreign, that are applicable to it and its properties, except where failure thereof would not reasonably be expected to result in 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
10
(or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by the Operating Partnership, the Company or any Subsidiary or Joint Venture.
(s) No Consents Required. No filing with, or authorization, approval, consent, license, order, registration, qualification or decree of, any court or governmental authority or agency is necessary or required for the performance by the Transaction Entities of their obligations hereunder, in connection with the offering, issuance or sale of the Securities and the Guarantee hereunder or the consummation of the transactions contemplated by the Transaction Documents, except for (i) the registration of the Securities and the Guarantee under the Securities Act, (ii) the qualification of the Indenture under the Trust Indenture Act and (iii) such consents, approvals, authorizations, orders and registrations or qualifications as may be required under applicable state securities laws in connection with the purchase and distribution of the Securities by the Underwriters.
(t) Legal Proceedings. Except as described in each of the Registration Statement, the Time of Sale Information and the Prospectus, there is no action, suit, proceeding, inquiry or investigation before or brought by any court or governmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Company, threatened, against or affecting the Operating Partnership, the Company or any Subsidiary or Joint Venture, which would reasonably be expected to result in a Material Adverse Effect, or which would materially and adversely affect the properties or assets of the Operating Partnership, the Company and its Subsidiaries considered as one enterprise or the consummation of the transactions contemplated in this Agreement or the performance by the Transaction Entities of their obligations hereunder; the aggregate of all pending legal or governmental proceedings to which the Operating Partnership, the Company or any Subsidiary or Joint Venture is a party or of which any of their respective property or assets is the subject which are not described in the Registration Statement, the Time of Sale Information and Prospectus, including ordinary routine litigation incidental to the business, would not reasonably be expected to result in, individually or in the aggregate, a Material Adverse Effect.
(u) Independent Accountants. Deloitte & Touche LLP, who certified the financial statements and supporting schedules included or incorporated by reference in the Registration Statement, the Time of Sale Information and the Prospectus, are independent registered public accountants as required by the Securities Act, the Exchange Act and the Public Company Accounting Oversight Board.
(v) Title to Real and Personal Property. The Operating Partnership, the Company and its Subsidiaries and its Joint Ventures have good and marketable title to all real property and other properties reflected as owned in the Company’s consolidated financial statements, in each case, free and clear of all mortgages, pledges, liens, security interests, claims, restrictions or encumbrances of any kind except such as (a) are described in the Registration Statement, the Time of Sale Information and the Prospectus or (b) would not reasonably be expected to, individually or in the aggregate, result in a Material Adverse Effect; and, to the Company’s knowledge, all of the leases and subleases material to the business of the Operating Partnership, the Company and its
11
Subsidiaries and Joint Ventures, and under which the Operating Partnership, the Company or any of its Subsidiaries or Joint Ventures holds or leases properties described in the Registration Statement, the Time of Sale Information and the Prospectus, are in full force and effect and enforceable in accordance with their terms except as may be limited by bankruptcy, insolvency or similar laws affecting the rights of creditors and with such exceptions as do not materially interfere with the use of the property, and none of the Operating Partnership, the Company or any Subsidiary or Joint Venture has 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 or Joint Venture under any of the leases or subleases mentioned above, or affecting or questioning the rights of the Operating Partnership, the Company or such Subsidiary or Joint Venture to the enforceability of said lease or sublease, possession of the leased or subleased premises under any such lease or sublease, as the case may be, except in each case for such matters as would not reasonably be expected to individually or in the aggregate result in a Material Adverse Effect. Except as otherwise disclosed in the Registration Statement, the Time of Sale Information and the Prospectus, or as would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, (i) no tenant under any of the leases pursuant to which the Operating Partnership, the Company or any Subsidiary or Joint Venture leases its properties has an option or right of first refusal to purchase the premises demised under such lease, (ii) the use and occupancy of each of the properties of the Operating Partnership, the Company and its Subsidiaries and Joint Ventures comply with all applicable laws, including, but not limited to, codes and zoning laws and regulations, (iii) no properties are subject to, and the Company has no knowledge of, any contemplated condemnation or zoning change that would affect the size of, use of, improvement of, construction on, or access to any of the properties of the Operating Partnership, the Company, its Subsidiaries or its Joint Ventures, and (iv) there is no pending, or to the Company’s knowledge, any contemplated proceeding or action that would affect the size of, use of, improvements or construction on, or access to any of the properties of the Operating Partnership, the Company, its Subsidiaries or its Joint Ventures. Except as disclosed in the Registration Statement, the Time of Sale Information and the Prospectus or as would not reasonably be expected to result in a Material Adverse Effect, (i) the Operating Partnership, the Company, its Subsidiaries and its Joint Ventures maintain title insurance with respect to the real property reflected as owned therein in an amount consistent with the title insurance maintained by similar companies in similar businesses and (ii) the mortgages and deeds of trust encumbering the properties and assets described or referred to therein are not convertible into equity.
(w) Intellectual Property. The Operating Partnership, the Company and its Subsidiaries and Joint Ventures own or possess, license, or have other rights to use or can acquire on reasonable terms rights with respect to patents, licenses, inventions, copyrights, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems, or procedures, whether or not patentable), trademarks, service marks, trade names and other intellectual property (collectively, “Intellectual Property”) necessary to carry on the business now operated by them as described in the Registration Statement, the Time of Sale Information and the Prospectus, except where the failure so to own, possess or license or have other rights to use or acquire would not
12
reasonably be expected, singly or in the aggregate, to result in a Material Adverse Effect. None of the Operating Partnership, the Company nor any of its Subsidiaries or Joint Ventures has received any notice of, or is otherwise aware of any infringement of or conflict with asserted rights of others with respect to any Intellectual Property or of any facts or circumstances which would render any Intellectual Property owned, possessed or licensed by the Operating Partnership, the Company or any of its Subsidiaries or Joint Ventures invalid or inadequate to protect the interest of the Operating Partnership, the Company or any of its Subsidiaries or Joint Ventures therein, and which infringement or conflict (if the subject of any unfavorable decision, ruling or finding) or invalidity or inadequacy, singly or in the aggregate, would reasonably be expected to result in a Material Adverse Effect.
(x) Investment Company Act. Neither the Operating Partnership nor the Company is, and, after giving effect to the offering and sale of the Securities and the application of the proceeds thereof as described in each of the Registration Statement, the Time of Sale Information and the Prospectus, neither the Operating Partnership nor the Company will be, an “investment company” or an entity “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Investment Company Act”).
(y) Taxes. The Operating Partnership, the Company and its Subsidiaries and Joint Ventures have filed all United States federal income tax returns that are required by law to be filed or have requested extensions thereof and have paid all taxes shown by such returns or otherwise assessed, which are due and payable, except assessments against which appeals have been or will be promptly taken and as to which adequate reserves have been provided, and all such returns are true and correct in all material respects. The Operating Partnership, the Company and its Subsidiaries and Joint Ventures have filed all other tax returns that are required to have been filed by them pursuant to applicable foreign, state, local or other law or have requested extensions thereof (except in any case in which the failure so to file would not reasonably be expected to have a Material Adverse Effect), and have paid all taxes due pursuant to such returns or pursuant to any assessment received by the Operating Partnership, the Company and its Subsidiaries, except for such taxes, if any, as are being contested in good faith and as to which adequate reserves have been provided, and all such returns are true and correct in all material respects. The Company has made appropriate provisions in the Company’s financial statements that are incorporated by reference into the Registration Statement (or otherwise described in the Time of Sale Information and the Prospectus) in respect of all federal, state, local and foreign income and franchise taxes for all current or prior periods as to which the tax liability of the Operating Partnership, the Company, its Subsidiaries and its Joint Ventures has not been finally determined, except to the extent of any inadequacy that would not reasonably be expected to result in a Material Adverse Effect.
(z) Licenses and Permits. The Operating Partnership, the Company and its Subsidiaries and Joint Ventures possess such permits, licenses, approvals, consents and other authorizations (collectively, “Governmental Licenses”) issued by the appropriate
13
federal, state, local or foreign regulatory agencies or bodies necessary to conduct the business now operated by them as described in the Registration Statement, the Time of Sale Information and the Prospectus, except where the failure so to possess would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect; the Operating Partnership, the Company and its Subsidiaries and Joint Ventures 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, reasonably be expected to result in a Material Adverse Effect; all of the Governmental Licenses are valid and in full force and effect, except when the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect; and none of the Operating Partnership, the Company or any of its Subsidiaries or Joint Ventures 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 reasonably be expected to result in a Material Adverse Effect.
(aa) No Labor Disputes. No labor dispute with the employees of the Operating Partnership, the Company or any Subsidiary exists or, to the knowledge of the Company, is imminent, and the Company is not 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 or Joint Venture’s principal suppliers, customers, tenants or contractors, which, in either case, would reasonably be expected to result in a Material Adverse Effect.
(bb) Certain Environmental Matters. Except as described in the Registration Statement, the Time of Sale Information and the Prospectus or except as would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect, (A) none of the Operating Partnership, the Company or any of its Subsidiaries or Joint Ventures is in violation of any applicable federal, state, local or foreign statute, law, rule, regulation, ordinance, code, policy or rule of common law or any judicial or administrative interpretation thereof, including any applicable and legally binding judicial or administrative order, consent, decree or judgment, relating to pollution or protection of human health from Hazardous Materials (as defined below) or protection of the environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or wildlife, 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, asbestos-containing materials or mold (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 its Subsidiaries and Joint Ventures have all permits, authorizations and approvals required under any applicable Environmental Laws necessary for the operation of their respective business and are each in compliance with their requirements; (C) the Company has not received any notice of, and has no knowledge of, any pending or threatened administrative, regulatory or judicial actions, suits, demands, demand letters, claims, liens, notices of noncompliance or violation, investigation or proceedings relating to any Environmental Laws against the
14
Operating Partnership, the Company or any of its Subsidiaries or Joint Ventures and (D) to the knowledge of the Company, there are no events or circumstances that would 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 or any of its Subsidiaries or Joint Ventures relating to Hazardous Materials or any Environmental Laws. Except as would not reasonably be expected to result in a Material Adverse Effect, the Operating Partnership, the Company and its Subsidiaries and Joint Ventures have conducted Phase I environmental assessments on each of their currently owned properties at the time such property was acquired. The Operating Partnership, the Company and its Subsidiaries and Joint Ventures currently conduct Phase I environmental assessments with respect to each property to be acquired as part of the ordinary course of business. The Operating Partnership, the Company and its Subsidiaries and Joint Ventures have not obtained any Phase I environmental assessments that have indicated the existence of any conditions that would reasonably be expected to result in a Material Adverse Effect. None of the entities which prepared appraisals of the properties or Phase I environmental assessment reports with respect to the properties held by the Operating Partnership, the Company or its Subsidiaries or Joint Ventures was employed for such purpose on a contingent basis or has any substantial interest in the Operating Partnership, the Company (other than any ownership by any such entity of less than 5% of the outstanding common stock of the Company) or its Subsidiaries or Joint Ventures, and none of their directors, officers or employees is connected with the Operating Partnership, the Company or any Subsidiary or Joint Venture as a promoter, selling agent, director, officer or employee.
(cc) Compliance with ERISA. (i) Each employee benefit plan, within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), for which the Company or any member of its “Controlled Group” (defined as any entity, whether or not incorporated, that is under common control with the Company within the meaning of Section 4001(a)(14) of ERISA or any entity that would be regarded as a single employer with the Company under Section 414(b),(c),(m) or (o) of the Internal Revenue Code of 1986, as amended (the “Code”)) would have any liability (each, a “Plan”) has been maintained in compliance with its terms and the requirements of any applicable statutes, orders, rules and regulations, including but not limited to ERISA and the Code; (ii) no prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the Code, has occurred with respect to any Plan, excluding transactions effected pursuant to a statutory or administrative exemption; (iii) for each Plan that is subject to the funding rules of Section 412 of the Code or Section 302 of ERISA, no Plan has failed (whether or not waived), or is reasonably expected to fail, to satisfy the minimum funding standards (within the meaning of Section 302 of ERISA or Section 412 of the Code) applicable to such Plan; (iv) no Plan is, or is reasonably expected to be, in “at risk status” (within the meaning of Section 303(i) of ERISA), and no Plan that is a “multiemployer plan” within the meaning of Section 4001(a)(3) of ERISA is in “endangered status” or “critical status” (within the meaning of Sections 304 and 305 of ERISA); (v) the fair market value of the assets of each Plan exceeds the present value of all benefits accrued under such Plan (determined based on those assumptions used to fund such Plan); (vi) no “reportable event” (within the meaning of Section 4043(c) of
15
ERISA and the regulations promulgated thereunder) has occurred or is reasonably expected to occur; (vii) each Plan that is intended to be qualified under Section 401(a) of the Code is so qualified, and nothing has occurred, whether by action or by failure to act, which would cause the loss of such qualification; (viii) neither the Company nor any member of the Controlled Group has incurred, nor reasonably expects to incur, any liability under Title IV of ERISA (other than contributions to the Plan or premiums to the Pension Benefit Guaranty Corporation, in the ordinary course and without default) in respect of a Plan (including a “multiemployer plan” within the meaning of Section 4001(a)(3) of ERISA); and (ix) none of the following events has occurred or is reasonably likely to occur: (A) a material increase in the aggregate amount of contributions required to be made to all Plans by the Company or its Controlled Group affiliates in the current fiscal year of the Company and its Controlled Group affiliates compared to the amount of such contributions made in the Company’s and its Controlled Group affiliates’ most recently completed fiscal year; or (B) a material increase in the Company and its subsidiaries’ “accumulated post-retirement benefit obligations” (within the meaning of Accounting Standards Codification Topic 715-60) compared to the amount of such obligations in the Company and its subsidiaries’ most recently completed fiscal year, except in each case with respect to the events or conditions set forth in (i) through (ix) hereof, as would not, individually or in the aggregate, have a Material Adverse Effect.
(dd) Accounting Controls and Disclosure Controls. The Operating Partnership, the Company and its Subsidiaries maintain effective internal control over financial reporting (as defined under Rule 13-a15 and 15d-15 under the Exchange Act Regulations) and a system of internal accounting controls sufficient to provide reasonable assurances that (A) transactions are executed in accordance with management’s general or specific authorization; (B) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets; (C) access to assets is permitted only in accordance with management’s general or specific authorization; (D) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences; and (E) the interactive data in eXtensible Business Reporting Language incorporated by reference in the Registration Statement, the Time of Sale Information and the Prospectus fairly presents the information called for in all material respects and is prepared in accordance with the Commission’s rules and guidelines applicable thereto. Except as described in the Registration Statement, the Time of Sale Information and the Prospectus, since the end of the Company’s most recent audited fiscal year, there has been (1) no material weakness in the Company’s internal control over financial reporting (whether or not remediated) and (2) 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. The Operating Partnership, the Company and its Subsidiaries maintain an effective system of disclosure controls and procedures (as defined in Rule 13a-15 and Rule 15d-15 under the Exchange Act Regulations) that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, and is accumulated and communicated to the Company’s
16
management, including its principal executive officer or officers and principal financial officer or officers, as appropriate, to allow timely decisions regarding disclosure.
(ee) Insurance. The Operating Partnership, the Company and its Subsidiaries and Joint Ventures carry or are entitled to the benefits of insurance in such amounts and covering such risks as are generally deemed customary for their business and all such insurance is in full force and effect. The Company has no reason to believe that it will not be able (A) to renew its existing insurance coverage as and when such policies expire or (B) to obtain comparable coverage from similar institutions as may be necessary or appropriate to conduct its business as now conducted and at a cost that would not reasonably be expected to result in a Material Adverse Effect. Since January 1, 2018, none of the Operating Partnership, the Company or any Subsidiary or Joint Venture has been denied any insurance coverage with respect to any material claim made by such party under policies such party reasonably believed covered such claim.
(ff) No Unlawful Payments. None of the Operating Partnership, the Company or any of its Subsidiaries, nor any director, officer or employee of the Operating Partnership, the Company or any of its Subsidiaries nor, to the knowledge of the Company, any agent, affiliate or other person associated with or acting on behalf of the Operating Partnership, the Company or any of its Subsidiaries has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; (ii) made or taken an act in furtherance of an offer, promise or authorization of any direct or indirect unlawful payment or benefit to any foreign or domestic government official or employee, including of any government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office; (iii) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977, as amended, or any applicable law or regulation implementing the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, or committed an offence under the Bribery Act 2010 of the United Kingdom, or any other applicable anti-bribery or anti-corruption law; or (iv) made, offered, agreed, requested or taken an act in furtherance of any unlawful bribe or other unlawful benefit, including, without limitation, any rebate, payoff, influence payment, kickback or other unlawful or improper payment or benefit. The Operating Partnership, the Company and its Subsidiaries have instituted, maintain and enforce, and will continue to maintain and enforce, policies and procedures designed to promote and ensure compliance with all applicable anti-bribery and anti-corruption laws.
(gg) Compliance with Anti-Money Laundering Laws. The operations of the Operating Partnership, the Company and its Subsidiaries, and, to the knowledge of the Company, its Joint Ventures, are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements, including those of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the applicable money laundering statutes of all jurisdictions where the Operating Partnership, the Company or any of its Subsidiaries conduct business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Anti-Money Laundering Laws”), and no action, suit
17
or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Operating Partnership, the Company or any of its Subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
(hh) No Conflicts with Sanctions Laws. None of the Operating Partnership, the Company or any of its Subsidiaries, or any of its or their directors, officers or employees, or, to the knowledge of the Company, any agent, affiliate or other person associated with or acting on behalf of the Operating Partnership, the Company or any of its Subsidiaries, is currently the subject or the target of any sanctions administered or enforced by the U.S. government, (including, without limitation, the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State and including, without limitation, the designation as a “specially designated national” or “blocked person”), the United Nations Security Council, the European Union, His Majesty’s Treasury, or other relevant sanctions authority (collectively, “Sanctions”), nor is the Operating Partnership, the Company or any of its Subsidiaries located, organized or resident in a country or territory that is the subject or target of Sanctions, including, without limitation, the Crimea Region of Ukraine, the so-called Donetsk People’s Republic, the so-called Luhansk People’s Republic, Cuba, Iran, North Korea and Syria (each, a “Sanctioned Country”); and the Operating Partnership will not directly or indirectly use the proceeds of the offering of the Securities hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity (i) to fund or facilitate any activities of or business with any person that, at the time of such funding or facilitation, is the subject or target of Sanctions, (ii) to fund or facilitate any activities of or business in any Sanctioned Country or (iii) in any other manner that will result in a violation by any person (including any person participating in the transaction, whether as underwriter, initial purchaser, advisor, investor or otherwise) of Sanctions. For the past ten years, the Operating Partnership, the Company and its Subsidiaries have not knowingly engaged in, are not now knowingly engaged in any dealings or transactions with any person that at the time of the dealing or transaction is or was the subject or the target of Sanctions or with any Sanctioned Country.
(ii) Dividends/Distributions. Except as disclosed in the Registration Statement, the Time of Sale Information and the Prospectus, or as would not reasonably be expected to result in a Material Adverse Effect, none of the Operating Partnership or any Subsidiary or Joint Venture is currently prohibited, directly or indirectly, from paying any dividends or distributions to the Company to the extent permitted by applicable law, from making any other distribution on the Operating Partnership’s or such Subsidiary’s or Joint Venture’s issued and outstanding capital stock or other equity interests, from repaying to the Company any loans or advances to the Operating Partnership or such Subsidiary or Joint Venture from the Company or from transferring any of the property or assets of the Operating Partnership or such Subsidiary or Joint Venture to the Company.
(jj) No Broker’s Fees. None of Operating Partnership, the Company or any of its Subsidiaries is a party to any contract, agreement or understanding with any person (other than this Agreement) that would give rise to a valid claim against any of them or any
18
Underwriter for a brokerage commission, finder’s fee or like payment in connection with the offering and sale of the Securities.
(kk) No Registration Rights. No person has the right to require the Operating Partnership, the Company or any of its Subsidiaries to register any securities for sale under the Securities Act by reason of the filing of the Registration Statement with the Commission or the issuance and sale of the Securities.
(ll) No Stabilization. Neither of the Transaction Entities has taken, directly or indirectly, any action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Securities.
(mm) Margin Rules. Neither the issuance, sale and delivery of the Securities nor the application of the proceeds thereof by the Operating Partnership as described in each of the Registration Statement, the Time of Sale Information and the Prospectus will violate Regulation T, U or X of the Board of Governors of the Federal Reserve System or any other regulation of such Board of Governors.
(nn) Forward-Looking Statements. No forward-looking statement (within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act) included or incorporated by reference in any of the Registration Statement, the Time of Sale Information or the Prospectus has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.
(oo) Statistical and Market Data. Any statistical and market-related data included in the Registration Statement, the Time of Sale Information and the Prospectus are based on or derived from sources that are reliable and accurate in all material respects, and, if required, the Operating Partnership or the Company has obtained the written consent to the use of such data from such sources.
(pp) Cybersecurity; Data Protection. The information technology assets and equipment, computers, systems, networks, hardware, software, websites, applications, and databases (collectively, “IT Systems”) of the Operating Partnership, the Company and its Subsidiaries are reasonably believed by the Operating Partnership, the Company and its Subsidiaries to be adequate for, and operate and perform in all material respects as required in connection with, the operation of the business of the Operating Partnership, the Company and each of its Subsidiaries as currently conducted, and, to the Company’s knowledge, are free and clear of all material bugs, errors, defects, Trojan horses, time bombs, malware and other corruptants. Each of the Operating Partnership, the Company and its Subsidiaries has implemented and maintained commercially reasonable controls, policies, procedures, and safeguards to maintain and protect its material confidential information and the integrity, continuous operation, redundancy and security of all IT Systems and data (including all personal, personally identifiable, sensitive, confidential or regulated data (“Personal Data”)) used in connection with their businesses, and there have been no known material breaches, violations, outages or unauthorized uses of or accesses to same, except for those that have been remedied without material cost or liability or the duty to notify any other person, nor any known material incidents under
19
internal review or investigations relating to the same. The Operating Partnership, the Company and its Subsidiaries are presently in compliance with all applicable laws or statutes and all judgments, orders, rules and regulations of any court or arbitrator or governmental or regulatory authority, internal policies and contractual obligations relating to the privacy and security of IT Systems and Personal Data and to the protection of such IT Systems and Personal Data from unauthorized use, access, misappropriation or modification, in each case, except for such failures as would not and are not reasonably likely to have a Material Adverse Effect.
(qq) Compliance with the Sarbanes-Oxley Act and Related Party Matters. There is and has been no failure on the part of the Company or any of the Company’s directors or officers, in their capacities as such, to comply in all material respects with any provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith (the “Sarbanes-Oxley Act”), including Section 402 related to loans and Sections 302 and 906 related to certifications. No transaction has occurred between or among the Operating Partnership, the Company and its Subsidiaries and Joint Ventures, on one hand, and any of their respective officers or directors or any affiliate or affiliates of any such officer or director, on the other hand, that is required to be described in the Registration Statement, the Time of Sale Information and the Prospectus which is not so described.
(rr) Status under the Securities Act. Neither the Operating Partnership nor the Company is an ineligible issuer as defined under the Securities Act, in each case at the times specified in the Securities Act in connection with the offering of the Securities. The Transaction Entities will pay the registration fees for this offering within the time period required by Rule 456(b)(1)(i) under the Securities Act (without giving effect to the proviso therein) and in any event prior to the Closing Date.
(ss) REIT Status. Commencing with its taxable year ended December 31, 1987, the Company has been organized and operated in conformity with the requirements for qualification and taxation as a real estate investment trust (“REIT”) under the Code, and the Company’s current and proposed method of operations as described in the Registration Statement, the Time of Sale Information and the Prospectus will enable it to continue to meet the requirements for qualification and taxation as a REIT under the Code for its taxable year ending December 31, 2025 and thereafter. No transaction or other event has occurred that could reasonably be expected to cause the Company to not be able to qualify as a REIT for its taxable year ending December 31, 2025 or future taxable years. The Operating Partnership, the Company and each of its Subsidiaries have no intention of changing their operations or engaging in activities that would cause the Company to fail to qualify, or make economically undesirable the Company’s continued qualification, as a REIT under the Code.
4. Further Agreements of the Transaction Entities. The Transaction Entities jointly and severally covenant and agree with each Underwriter that:
(a) Required Filings. The Transaction Entities will file the final Prospectus with the Commission within the time periods specified by Rule 424(b) and Rule 430A, 430B
20
or 430C under the Securities Act, will file any Issuer Free Writing Prospectus (including the Pricing Term Sheet referred to in Annex B hereto) to the extent required by Rule 433 under the Securities Act; and the Company will file promptly all reports and any definitive proxy or information statements required to be filed by the Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the Prospectus and for so long as the delivery of a prospectus is required in connection with the offering or sale of the Securities; and the Transaction Entities will furnish copies of the Prospectus and each Issuer Free Writing Prospectus (to the extent not previously delivered) to the Underwriters in New York City prior to 10:00 A.M., New York City time, on the business day next succeeding the date of this Agreement in such quantities as the Representatives may reasonably request.
(b) Delivery of Copies. The Transaction Entities will deliver, without charge, upon request (i) to the Representatives, two signed copies of the Registration Statement as originally filed and each amendment thereto, in each case including all exhibits and consents filed therewith and documents incorporated by reference therein; and (ii) to each Underwriter (A) a conformed copy of the Registration Statement as originally filed and each amendment thereto, in each case including all exhibits and consents filed therewith and (B) during the Prospectus Delivery Period (as defined below), as many copies of the Prospectus (including all amendments and supplements thereto and documents incorporated by reference therein) and each Issuer Free Writing Prospectus as the Representatives may reasonably request. As used herein, the term “Prospectus Delivery Period” means such period of time after the first date of the public offering of the Securities as in the opinion of counsel for the Underwriters a prospectus relating to the Securities is required by law to be delivered (or required to be delivered but for Rule 172 under the Securities Act) in connection with sales of the Securities by any Underwriter or dealer.
(c) Amendments or Supplements; Issuer Free Writing Prospectuses. Before making, preparing, using, authorizing, approving, referring to or filing any Issuer Free Writing Prospectus, and before filing any amendment or supplement to the Registration Statement or the Prospectus, whether before or after the time that the Registration Statement becomes effective the Transaction Entities will furnish to the Representatives and counsel for the Underwriters a copy of the proposed Issuer Free Writing Prospectus, amendment or supplement for review and will not make, prepare, use, authorize, approve, refer to or file any such Issuer Free Writing Prospectus or file any such proposed amendment or supplement to which the Representatives reasonably object.
(d) Notice to the Representatives. The Transaction Entities will advise the Representatives promptly, and confirm such advice in writing, (i) when any amendment to the Registration Statement has been filed or becomes effective; (ii) when any supplement to the Prospectus or any Issuer Free Writing Prospectus or any amendment to the Prospectus or any Issuer Free Writing Prospectus has been filed; (iii) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or the receipt of any comments from the Commission relating to the Registration Statement or any other request by the Commission for any additional information; (iv) of the issuance by the Commission or any other governmental
21
or regulatory authority of any order suspending the effectiveness of the Registration Statement or preventing or suspending the use of any Preliminary Prospectus, the Prospectus, any Time of Sale Information or any Issuer Free Writing Prospectus or the initiation or threatening of any proceeding for that purpose or pursuant to Section 8A of the Securities Act; (v) of the occurrence of any event or development within the Prospectus Delivery Period as a result of which the Prospectus, any of the Time of Sale Information or any Issuer Free Writing Prospectus as then amended or supplemented would include 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 existing when the Prospectus, the Time of Sale Information or any such Issuer Free Writing Prospectus is delivered to a purchaser, not misleading; (vi) of the receipt by the Transaction Entities of any notice of objection of the Commission to the use of the Registration Statement or any post-effective amendment thereto pursuant to Rule 401(g)(2) under the Securities Act; and (vii) of the receipt by the Transaction Entities of any notice with respect to any suspension of the qualification of the Securities for offer and sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and the Transaction Entities will use their reasonable best efforts to prevent the issuance of any such order suspending the effectiveness of the Registration Statement, preventing or suspending the use of any of the Preliminary Prospectus, the Time of Sale Information, an Issuer Free Writing Prospectus or the Prospectus, or suspending any such qualification of the Securities and, if any such order is issued, will use their reasonable best efforts to obtain as soon as possible the withdrawal thereof.
(e) Time of Sale Information. If at any time prior to the Closing Date (i) any event shall occur or condition shall exist as a result of which any of the Time of Sale Information as then amended or supplemented would 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 or (ii) it is necessary to amend or supplement the Time of Sale Information to comply with law, the Transaction Entities will immediately notify the Underwriters thereof and forthwith prepare and, subject to paragraph (c) above, file with the Commission (to the extent required) and furnish to the Underwriters and to such dealers as the Representatives may designate, such amendments or supplements to the Time of Sale Information (or any document to be filed with the Commission and incorporated by reference therein) as may be necessary so that the statements in any of the Time of Sale Information as so amended or supplemented (including such documents to be incorporated by reference therein) will not, in the light of the circumstances under which they were made, be misleading or so that any of the Time of Sale Information will comply with law.
(f) Ongoing Compliance. If during the Prospectus Delivery Period (i) any event shall occur or condition shall exist as a result of which the Prospectus as then amended or supplemented would 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 existing when the Prospectus is delivered to a purchaser, not misleading or (ii) it is necessary to amend or supplement the Prospectus to comply with law, the Transaction Entities will immediately notify the Underwriters thereof and forthwith prepare
22
and, subject to paragraph (c) above, file with the Commission and furnish to the Underwriters and to such dealers as the Representatives may designate, such amendments or supplements to the Prospectus (or any document to be filed with the Commission and incorporated by reference therein) as may be necessary so that the statements in the Prospectus as so amended or supplemented including such documents to be incorporated by reference therein will not, in the light of the circumstances existing when the Prospectus is delivered to a purchaser, be misleading or so that the Prospectus will comply with law.
(g) Blue Sky Compliance. The Transaction Entities will qualify the Securities for offer and sale under the securities or Blue Sky laws of such jurisdictions as the Representatives shall reasonably request and will continue such qualifications in effect so long as required for distribution of the Securities; provided that neither of the Transaction Entities shall be required to (i) qualify as a foreign corporation or other entity or as a dealer in securities in any such jurisdiction where it would not otherwise be required to so qualify, (ii) file any general consent to service of process in any such jurisdiction or (iii) subject itself to taxation in any such jurisdiction if it is not otherwise so subject.
(h) Earning Statement. The Company will make generally available to its security holders and the Representatives as soon as practicable an earning statement that satisfies the provisions of Section 11(a) of the Securities Act and Rule 158 of the Commission promulgated thereunder covering a period of at least twelve months beginning with the first fiscal quarter of the Company occurring after the “effective date” (as defined in Rule 158) of the Registration Statement.
(i) Clear Market. During the period from the date hereof through and including the Closing Date, the Transaction Entities will not, without the prior written consent of the Representatives, offer, sell, contract to sell or otherwise dispose of any debt securities issued or guaranteed by the Transaction Entities and having a tenor of more than one year.
(j) Use of Proceeds. The Operating Partnership will apply the net proceeds from the sale of the Securities as described in each of the Registration Statement, the Time of Sale Information and the Prospectus under the heading “Use of Proceeds.”
(k) DTC. The Transaction Entities will assist the Underwriters in arranging for the Securities to be eligible for clearance and settlement through DTC.
(l) No Stabilization. Neither of the Transaction Entities will take, directly or indirectly, any action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Securities.
(m) Record Retention. The Transaction Entities will, pursuant to reasonable procedures developed in good faith, retain copies of each Issuer Free Writing Prospectus that is not filed with the Commission in accordance with Rule 433 under the Securities Act.
23
5. Certain Agreements of the Underwriters. Each Underwriter hereby represents and agrees that:
(a) It has not and will not use, authorize use of, refer to, or participate in the planning for use of, any “free writing prospectus,” as defined in Rule 405 under the Securities Act (which term includes use of any written information furnished to the Commission by the Transaction Entities and not incorporated by reference into the Registration Statement and any press release issued by the Company) other than (i) a free writing prospectus that, solely as a result of use by such Underwriter, would not trigger an obligation to file such free writing prospectus with the Commission pursuant to Rule 433, (ii) any Issuer Free Writing Prospectus listed on Annex A or prepared pursuant to Section 3(c) or Section 4(c) above (including any electronic road show), or (iii) any free writing prospectus prepared by such Underwriter and approved by the Transaction Entities in advance in writing (each such free writing prospectus referred to in clauses (i) or (iii), an “Underwriter Free Writing Prospectus”). Notwithstanding the foregoing, the Underwriters may use the Pricing Term Sheet referred to in Annex B hereto without the consent of the Transaction Entities.
(b) It is not subject to any pending proceeding under Section 8A of the Securities Act with respect to the offering (and will promptly notify the Transaction Entities if any such proceeding against it is initiated during the Prospectus Delivery Period).
6. Conditions of Underwriters’ Obligations. The obligation of each Underwriter to purchase Securities on the Closing Date as provided herein is subject to the performance by the Transaction Entities of their respective covenants and other obligations hereunder and to the following additional conditions:
(a) Registration Compliance; No Stop Order. No order suspending the effectiveness of the Registration Statement shall be in effect, and no proceeding for such purpose, pursuant to Rule 401(g)(2) or pursuant to Section 8A under the Securities Act shall be pending before or threatened by the Commission; the Prospectus and each Issuer Free Writing Prospectus shall have been timely filed with the Commission under the Securities Act (in the case of an Issuer Free Writing Prospectus, to the extent required by Rule 433 under the Securities Act) and in accordance with Section 4(a) hereof; and all requests by the Commission for additional information shall have been complied with to the reasonable satisfaction of the Representatives.
(b) Representations and Warranties. The representations and warranties of the Transaction Entities contained herein shall be true and correct on the date hereof and on and as of the Closing Date; and the statements of the Transaction Entities and their respective officers made in any certificates delivered pursuant to this Agreement shall be true and correct on and as of the Closing Date.
(c) No Downgrade. Subsequent to the earlier of (A) the Time of Sale and (B) the execution and delivery of this Agreement, (i) no downgrading shall have occurred in the rating accorded the Securities or any other debt securities or preferred stock issued or guaranteed by the Operating Partnership, the Company or any of its Subsidiaries by
24
any “nationally recognized statistical rating organization,” as such term is defined under Section 3(a)(62) under the Exchange Act and (ii) no such organization shall have publicly announced that it has under surveillance or review, or has changed its outlook with respect to, its rating of the Securities or of any other debt securities or preferred stock issued or guaranteed by the Operating Partnership, the Company or any of its Subsidiaries (other than an announcement with positive implications of a possible upgrading).
(d) No Material Adverse Change. No event or condition of a type described in Section 3(g) hereof shall have occurred or shall exist, which event or condition is not described in each of the Time of Sale Information (excluding any amendment or supplement thereto) and the Prospectus (excluding any amendment or supplement thereto) the effect of which in the judgment of the Representatives makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the Securities on the terms and in the manner contemplated by this Agreement, the Time of Sale Information and the Prospectus.
(e) Officer’s Certificate. The Representatives shall have received on and as of the Closing Date a certificate of an executive officer of the Company who has specific knowledge of the Operating Partnership’s and the Company’s financial matters, and is satisfactory to the Representatives (i) confirming that such officer has carefully reviewed the Registration Statement, the Time of Sale Information and the Prospectus and, to the knowledge of such officer, the representations set forth in Sections 3(b) and 3(d) hereof are true and correct, (ii) confirming that the other representations and warranties of the Transaction Entities in this Agreement are true and correct and that the Transaction Entities have complied with all agreements and satisfied all conditions on their part to be performed or satisfied hereunder at or prior to the Closing Date and (iii) to the effect set forth in paragraphs (a), (c) and (d) above.
(f) Comfort Letters. On the date of this Agreement and on the Closing Date, Deloitte & Touche LLP shall have furnished to the Representatives, at the request of the Transaction Entities, letters, dated the respective dates of delivery thereof and addressed to the Underwriters, in form and substance reasonably satisfactory to the Representatives, containing statements and information of the type customarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained or incorporated by reference in each of the Registration Statement, the Time of Sale Information and the Prospectus; provided that the letter delivered on the Closing Date shall use a “cut-off” date no more than three business days prior to the Closing Date.
(g) CFO Certificate. The Transaction Entities shall have furnished to the Representatives a certificate, dated the Closing Date and addressed to the Representatives, of the Company’s chief financial officer with respect to certain financial data contained in the Registration Statement, the Time of Sale Information and the Prospectus, providing “management comfort” with respect to such information, in form and substance reasonably satisfactory to the Representatives.
25
(h) Opinion and 10b-5 Statement of Counsel for the Transaction Entities. King & Spalding LLP, counsel for the Transaction Entities, shall have furnished to the Representatives, at the request of the Transaction Entities, its written opinion and 10b-5 statement, dated the Closing Date and addressed to the Underwriters, in form and substance reasonably satisfactory to the Representatives, to the effect set forth in Annex C hereto.
(i) Tax Opinion of Counsel for the Transaction Entities. Deloitte Tax LLP, tax counsel for the Transaction Entities, shall have furnished to the Representatives, at the request of the Transaction Entities, its opinion with respect to such tax matters, dated the Closing Date and addressed to the Underwriters, including without limitation, the qualification of the Company as a REIT, the classification of the Operating Partnership as neither a corporation nor an association taxable as a corporation for U.S. federal income tax purposes and the discussion of tax matters in each of the Registration Statement, the Time of Sale Information and the Prospectus as the Representatives may reasonably require.
(j) Opinion and 10b-5 Statement of Counsel for the Underwriters. The Representatives shall have received on and as of the Closing Date an opinion and 10b-5 statement, addressed to the Underwriters, of Hogan Lovells US LLP, counsel for the Underwriters, with respect to such matters as the Representatives may reasonably request, and such counsel shall have received such documents and information as they may reasonably request to enable them to pass upon such matters.
(k) No Legal Impediment to Issuance. No action shall have been taken and no statute, rule, regulation or order shall have been enacted, adopted or issued by any federal, state or foreign governmental or regulatory authority that would, as of the Closing Date, prevent the issuance or sale of the Securities or the issuance of the Guarantee; and no injunction or order of any federal, state or foreign court shall have been issued that would, as of the Closing Date, prevent the issuance or sale of the Securities or the issuance of the Guarantee.
(l) Good Standing. The Representatives shall have received on and as of the Closing Date satisfactory evidence of the good standing of the Transaction Entities in their respective jurisdictions of organization and their good standing in such other jurisdictions as the Representatives may reasonably request, in each case in writing or any standard form of telecommunication, from the appropriate governmental authorities of such jurisdictions.
(m) DTC. The Securities shall be eligible for clearance and settlement through DTC.
(n) Indenture and Securities. The Indenture shall have been duly executed and delivered by a duly authorized officer of the Transaction Entities and the Trustee, and the Securities shall have been duly executed and delivered by a duly authorized officer of the Operating Partnership and duly authenticated by the Trustee.
26
(o) Additional Documents. On or prior to the Closing Date, the Transaction Entities shall have furnished to the Representatives such further customary certificates and documents as the Representatives may reasonably request.
All opinions, letters, certificates and evidence mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Underwriters.
7. Indemnification and Contribution.
(a) Indemnification of the Underwriters. Each of the Transaction Entities, jointly and severally, agrees to indemnify and hold harmless each Underwriter, its affiliates, directors and officers and each person, if any, who controls such Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, from and against any and all losses, claims, damages and liabilities (including, without limitation, legal fees and other expenses reasonably incurred in connection with any suit, action or proceeding or any claim asserted, as such fees and expenses are incurred), joint or several, that arise out of, or are based upon, (i) any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein, not misleading, or (ii) any untrue statement or alleged untrue statement of a material fact contained in the Prospectus (or any amendment or supplement thereto), any Issuer Free Writing Prospectus or any Time of Sale Information, or caused by any omission or alleged omission to state therein 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 each case except insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to any Underwriter furnished to the Transaction Entities in writing by such Underwriter through the Representatives expressly for use therein.
(b) Indemnification of the Transaction Entities. Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Transaction Entities and each of their respective directors and officers who signed the Registration Statement and each person, if any, who controls the Transaction Entities within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the indemnity set forth in paragraph (a) above, but only with respect to any losses, claims, damages or liabilities that arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to such Underwriter furnished to the Transaction Entities in writing by such Underwriter through the Representatives expressly for use in the Registration Statement, the Prospectus (or any amendment or supplement thereto), any Issuer Free Writing Prospectus or any Time of Sale Information, it being understood and agreed that the only such information consists of the following paragraphs in the Preliminary Prospectus and the Prospectus: first and second sentences of the third paragraph, the third sentence of the seventh paragraph and the eighth paragraph, in each
27
case under the heading of “Underwriting and Conflicts of Interest,” in each of the Preliminary Prospectus and the Prospectus.
(c) Notice and Procedures. If any suit, action, proceeding (including any governmental or regulatory investigation), claim or demand shall be brought or asserted against any person in respect of which indemnification may be sought pursuant to either paragraph (a) or (b) above, such person (the “Indemnified Person”) shall promptly notify the person against whom such indemnification may be sought (the “Indemnifying Person”) in writing; provided that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have under paragraph (a) or (b) above except to the extent that it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and provided, further, that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have to an Indemnified Person otherwise than under paragraph (a) or (b) above. If any such proceeding shall be brought or asserted against an Indemnified Person and it shall have notified the Indemnifying Person thereof, the Indemnifying Person shall retain counsel reasonably satisfactory to the Indemnified Person (who shall not, without the consent of the Indemnified Person, be counsel to the Indemnifying Person) to represent the Indemnified Person and any others entitled to indemnification pursuant to this Section 7 that the Indemnifying Person may designate in such proceeding and shall pay the fees and expenses of such proceeding and shall pay the fees and expenses of such counsel related to such proceeding, as incurred. In any such proceeding, any Indemnified Person shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such Indemnified Person unless (i) the Indemnifying Person and the Indemnified Person shall have mutually agreed to the contrary; (ii) the Indemnifying Person has failed within a reasonable time to retain counsel reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person shall have reasonably concluded that there may be legal defenses available to it that are different from or in addition to those available to the Indemnifying Person; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the Indemnifying Person and the Indemnified Person and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. It is understood and agreed that the Indemnifying Person shall not, in connection with any proceeding or related proceeding in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all Indemnified Persons, and that all such fees and expenses shall be paid or reimbursed as they are incurred. Any such separate firm for any Underwriter, its affiliates, directors and officers and any control persons of such Underwriter shall be designated in writing by the Representatives and any such separate firm for the Transaction Entities, their respective directors and officers who signed the Registration Statement and any control persons of the Transaction Entities shall be designated in writing by the Transaction Entities. The Indemnifying Person shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the Indemnifying Person agrees to indemnify each Indemnified Person from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an Indemnified Person shall have requested that an Indemnifying Person
28
reimburse the Indemnified Person for fees and expenses of counsel as contemplated by this paragraph, the Indemnifying Person shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 45 days after receipt by the Indemnifying Person of such request and (ii) the Indemnifying Person shall not have reimbursed the Indemnified Person in accordance with such request prior to the date of such settlement. No Indemnifying Person shall, without the written consent of the Indemnified Person, effect any settlement of any pending or threatened proceeding in respect of which any Indemnified Person is or could have been a party and indemnification could have been sought hereunder by such Indemnified Person, unless such settlement (x) includes an unconditional release of such Indemnified Person, in form and substance reasonably satisfactory to such Indemnified Person, from all liability on claims that are the subject matter of such proceeding and (y) does not include any statement as to or any admission of fault, culpability or a failure to act by or on behalf of any Indemnified Person.
(d) Contribution. If the indemnification provided for in paragraph (a) or (b) above is unavailable to an Indemnified Person or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each Indemnifying Person under such paragraph, in lieu of indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or payable by such Indemnified Person as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Transaction Entities on the one hand and the Underwriters on the other from the offering of the Securities or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) but also the relative fault of the Transaction Entities on the one hand and the Underwriters on the other in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Transaction Entities on the one hand and the Underwriters on the other shall be deemed to be in the same respective proportions as the net proceeds (before deducting expenses) received by the Transaction Entities from the sale of the Securities and the total underwriting discounts and commissions received by the Underwriters in connection therewith, in each case as set forth in the table on the cover of the Prospectus, bear to the aggregate offering price of the Securities. The relative fault of the Transaction Entities on the one hand and the Underwriters on the other 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 Transaction Entities or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
(e) Limitation on Liability. The Transaction Entities 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 that does not take account of the equitable considerations referred to in paragraph (d) above. The amount paid or payable
29
by an Indemnified Person as a result of the losses, claims, damages and liabilities referred to in paragraph (d) above shall be deemed to include, subject to the limitations set forth above, any legal or other expenses incurred by such Indemnified Person in connection with any such action or claim. Notwithstanding the provisions of this Section 7, in no event shall an Underwriter be required to contribute any amount in excess of the amount by which the total underwriting discounts and commissions received by such Underwriter with respect to the offering of the Securities exceeds the amount of any damages that such 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 Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters’ obligations to contribute pursuant to this Section 7 are several in proportion to their respective purchase obligations hereunder and not joint.
(f) Non-Exclusive Remedies. The remedies provided for in this Section 7 are not exclusive and shall not limit any rights or remedies that may otherwise be available to any Indemnified Person at law or in equity.
8. Effectiveness of Agreement. This Agreement shall become effective as of the date first written above.
9. Termination. This Agreement may be terminated in the absolute discretion of the Representatives, by notice to the Transaction Entities, if after the execution and delivery of this Agreement and on or prior to the Closing Date: (i) trading generally shall have been suspended or materially limited on the New York Stock Exchange or the over-the-counter market; (ii) trading of any securities issued or guaranteed by the Transaction Entities shall have been suspended on any exchange or in any over-the-counter market; (iii) a general moratorium on commercial banking activities shall have been declared by federal or New York State authorities; or (iv) there shall have occurred any outbreak or escalation of hostilities or any change in financial markets or any calamity or crisis, either within or outside the United States, that, in the judgment of the Representatives, is material and adverse and makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the Securities on the terms and in the manner contemplated by this Agreement, the Time of Sale Information and the Prospectus.
10. Defaulting Underwriter.
(a) If, on the Closing Date, any Underwriter defaults on its obligation to purchase the Securities that it has agreed to purchase hereunder, the non-defaulting Underwriters may in their discretion arrange for the purchase of such Securities by other persons satisfactory to the Transaction Entities on the terms contained in this Agreement. If, within 36 hours after any such default by any Underwriter, the non-defaulting Underwriters do not arrange for the purchase of such Securities, then the Transaction Entities shall be entitled to a further period of 36 hours within which to procure other persons satisfactory to the non-defaulting Underwriters to purchase such Securities on such terms. If other persons become obligated or agree to purchase the Securities of a defaulting Underwriter, either the non-defaulting Underwriters or the Transaction Entities may postpone the Closing Date for
30
up to five full business days in order to effect any changes that in the opinion of counsel for the Transaction Entities or counsel for the Underwriters may be necessary in the Registration Statement, the Time of Sale Information and the Prospectus or in any other document or arrangement, and the Transaction Entities agree to promptly prepare any amendment or supplement to the Registration Statement, the Time of Sale Information and the Prospectus that effects any such changes. As used in this Agreement, the term “Underwriter” includes, for all purposes of this Agreement unless the context otherwise requires, any person not listed in Schedule 1 hereto that, pursuant to this Section 10, purchases Securities that a defaulting Underwriter agreed but failed to purchase.
(b) If, after giving effect to any arrangements for the purchase of the Securities of a defaulting Underwriter or Underwriters by the non-defaulting Underwriters and the Transaction Entities as provided in paragraph (a) above, the aggregate principal amount of such Securities that remains unpurchased does not exceed one-eleventh of the aggregate principal amount of all the Securities, then the Transaction Entities shall have the right to require each non-defaulting Underwriter to purchase the principal amount of Securities that such Underwriter agreed to purchase hereunder plus such Underwriter’s pro rata share (based on the principal amount of Securities that such Underwriter agreed to purchase hereunder) of the Securities of such defaulting Underwriter or Underwriters for which such arrangements have not been made.
(c) If, after giving effect to any arrangements for the purchase of the Securities of a defaulting Underwriter or Underwriters by the non-defaulting Underwriters and the Transaction Entities as provided in paragraph (a) above, the aggregate principal amount of such Securities that remains unpurchased exceeds one-eleventh of the aggregate principal amount of all the Securities, or if the Transaction Entities shall not exercise the right described in paragraph (b) above, then this Agreement shall terminate without liability on the part of the non-defaulting Underwriters. Any termination of this Agreement pursuant to this Section 10 shall be without liability on the part of the Transaction Entities, except that the Transaction Entities will continue to be liable for the payment of expenses as set forth in Section 11 hereof and except that the provisions of Section 7 hereof shall not terminate and shall remain in effect.
(d) Nothing contained herein shall relieve a defaulting Underwriter of any liability it may have to the Transaction Entities or any non-defaulting Underwriter for damages caused by its default.
11. Payment of Expenses.
(a) Whether or not the transactions contemplated by this Agreement are consummated or this Agreement is terminated, the Transaction Entities, jointly and severally, agree to pay or cause to be paid all costs and expenses incident to the performance of their respective obligations hereunder, including without limitation, (i) the costs incident to the authorization, issuance, sale, preparation and delivery of the Securities and any taxes payable in that connection; (ii) the costs incident to the preparation, printing and filing under the Securities Act of the Registration Statement, the Preliminary Prospectus, any Issuer Free Writing Prospectus, any Time of Sale Information and the
31
Prospectus (including all exhibits, amendments and supplements thereto) and the distribution thereof; (iii) the costs of reproducing and distributing each of the Transaction Documents; (iv) the fees and expenses of the Transaction Entities’ counsel and independent accountants; (v) the fees and expenses incurred in connection with the registration or qualification and determination of eligibility for investment of the Securities under the laws of such jurisdictions as the Representatives may designate and the preparation, printing and distribution of a Blue Sky Memorandum (including the related fees and expenses of counsel for the Underwriters); (vi) any fees charged by rating agencies for rating the Securities; (vii) the fees and expenses of the Trustee and any paying agent (including related fees and expenses of any counsel to such parties); (viii) all expenses and application fees incurred in connection with any filing with, and clearance of the offering by, the Financial Industry Regulatory Authority, and the approval of the Securities for book-entry transfer by DTC; and (ix) all expenses incurred by the Transaction Entities in connection with any “road show” presentation to potential investors.
(b) If (i) this Agreement is terminated pursuant to Section 9, (ii) the Operating Partnership for any reason fails to tender the Securities for delivery to the Underwriters or (iii) the Underwriters decline to purchase the Securities for any reason permitted under this Agreement, the Transaction Entities jointly and severally agree to reimburse the Underwriters for all out-of-pocket costs and expenses (including the fees and expenses of their counsel) reasonably incurred by the Underwriters in connection with this Agreement and the offering contemplated hereby.
12. Persons Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and the officers and directors and any controlling persons referred to herein, and the affiliates of each Underwriter referred to in Section 7 hereof. Nothing in this Agreement is intended or shall be construed to give any other person any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein. No purchaser of Securities from any Underwriter shall be deemed to be a successor merely by reason of such purchase.
13. Survival. The respective indemnities, rights of contribution, representations, warranties and agreements of the Transaction Entities and the Underwriters contained in this Agreement or made by or on behalf of the Transaction Entities or the Underwriters pursuant to this Agreement or any certificate delivered pursuant hereto shall survive the delivery of and payment for the Securities and shall remain in full force and effect, regardless of any termination of this Agreement or any investigation made by or on behalf of the Transaction Entities or the Underwriters.
14. Certain Defined Terms. For purposes of this Agreement, (a) except where otherwise expressly provided, the term “affiliate” has the meaning set forth in Rule 405 under the Securities Act and (b) the term “business day: means any day other than a day on which banks are permitted or required to be closed in New York City.
15. Compliance with USA Patriot Act. In accordance with the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)), the
32
Underwriters are required to obtain, verify and record information that identifies their respective clients, including the Transaction Entities, which information may include the name and address of their respective clients, as well as other information that will allow the Underwriters to properly identify their respective clients.
16. Miscellaneous.
(a) Authority of the Representatives. Any action by the Underwriters hereunder may be taken by Wells Fargo Securities, LLC, BofA Securities, Inc. or TD Securities (USA) LLC on behalf of the Underwriters, and any such action taken by Wells Fargo Securities, LLC, BofA Securities, Inc. or TD Securities (USA) LLC shall be binding upon the Underwriters.
(b) Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted and confirmed by any standard form of telecommunication. Notices to the Underwriters shall be given to the Representatives at c/o Wells Fargo Securities, LLC, 550 S. Tryon Street, 5th Floor, Charlotte, North Carolina 28202, Attention: Transaction Management, Email: [email protected]; c/o BofA Securities, Inc., 114 W 47th Street, NY8-114-07-01, New York, New York 10036, Facsimile: (646) 855-5958, Attention: High Grade Transaction Management/Legal, Email: [email protected]; and c/o TD Securities (USA) LLC, 1 Vanderbilt Avenue, 11th Floor, New York, NY 10017, Attention: DCM – Transaction Advisory Group, e-mail: [email protected], with a copy to: Hogan Lovells US LLP, 555 Thirteenth Street, NW Washington, D.C. 20004, Attention: Michael McTiernan. Notices to the Transaction Entities shall be given to them at Cousins Properties Incorporated, 3344 Peachtree Road NE, Suite 1800, Atlanta, Georgia 30326-4802, Attention: Chief Executive Officer and Chief Financial Officer, with a copy to King & Spalding LLP, 1180 Peachtree Street, NE, Atlanta, Georgia 30309, Attention: Keith Townsend, Email: [email protected].
(c) Governing Law. This Agreement and any claim, controversy or dispute arising under or related to this Agreement shall be governed by and construed in accordance with the laws of the State of New York.
(d) Waiver of Jury Trial. Each of the parties hereto hereby waives any right to trial by jury in any suit or proceeding arising out of or relating to this Agreement.
(e) Recognition of the U.S. Special Resolution Regimes.
(i) In the event that any Underwriter that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from such Underwriter of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.
33
(ii) In the event that any Underwriter that is a Covered Entity or a BHC Act Affiliate of such Underwriter becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against such Underwriter are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.
As used in this Section 16(e):
“BHC Act Affiliate” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k).
“Covered Entity” means any of the following:
(i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b);
(ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or
(iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).
“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.
“U.S. Special Resolution Regime” means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.
(f) Counterparts. This Agreement may be signed in counterparts (which may include counterparts delivered by any standard form of telecommunication), each of which shall be an original and all of which together shall constitute one and the same instrument. The words “execution,” “signed,” “signature,” “delivery,” and words of like import in or relating to this Agreement or any document to be signed in connection with this Agreement shall be deemed to include electronic signatures, deliveries or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, and the parties hereto consent to the conduct of the transactions contemplated hereunder by electronic means.
(g) Amendments or Waivers. No amendment or waiver of any provision of this Agreement, nor any consent or approval to any departure therefrom, shall in any event be effective unless the same shall be in writing and signed by the parties hereto.
34
(h) Headings. The headings herein are included for convenience of reference only and are not intended to be part of, or to affect the meaning or interpretation of, this Agreement.
35
If the foregoing is in accordance with your understanding, please indicate your acceptance of this Agreement by signing in the space provided below.
| Very truly yours, | |||||||||||||||||||||||
| COUSINS PROPERTIES LP | |||||||||||||||||||||||
By: COUSINS PROPERTIES INCORPORATED, its General Partner | |||||||||||||||||||||||
| By: | /s/ Gregg Adzema | ||||||||||||||||||||||
| Name: | Gregg D. Adzema | ||||||||||||||||||||||
| Title: | Executive Vice President and Chief Financial Officer | ||||||||||||||||||||||
| COUSINS PROPERTIES INCORPORATED | |||||||||||||||||||||||
| By: | /s/ Gregg Adzema | ||||||||||||||||||||||
| Name: | Gregg D. Adzema | ||||||||||||||||||||||
| Title: | Executive Vice President and Chief Financial Officer | ||||||||||||||||||||||
[Signature Page — CUZ — Underwriting Agreement]
| Accepted: As of the date first written above | ||||||||||||||
| WELLS FARGO SECURITIES, LLC | ||||||||||||||
For itself and on behalf of the several Underwriters listed in Schedule 1 hereto. | ||||||||||||||
| By: | /s/ Carolyn Hurley | |||||||||||||
| Name: | Carolyn Hurley | |||||||||||||
| Title: | Managing Director | |||||||||||||
[Signature Page — CUZ — Underwriting Agreement]
| BOFA SECURITIES, INC. | ||||||||||||||
For itself and on behalf of the several Underwriters listed in Schedule 1 hereto. | ||||||||||||||
| By: | /s/ Shawn Cepeda | |||||||||||||
| Name: | Shawn Cepeda | |||||||||||||
| Title: | Managing Director | |||||||||||||
[Signature Page — CUZ — Underwriting Agreement]
| TD SECURITIES (USA) LLC | ||||||||||||||
For itself and on behalf of the several Underwriters listed in Schedule 1 hereto. | ||||||||||||||
| By: | /s/ Luiz Lanfredi | |||||||||||||
| Name: | Luiz Lanfredi | |||||||||||||
| Title: | Managing Director | |||||||||||||
[Signature Page — CUZ — Underwriting Agreement]
Schedule 1
| Underwriter | Principal Amount | |||||||||||||||||||
| Wells Fargo Securities, LLC | $ | 112,500,000 | ||||||||||||||||||
| BofA Securities, Inc. | $ | 112,500,000 | ||||||||||||||||||
| TD Securities (USA) LLC | $ | 112,500,000 | ||||||||||||||||||
| J.P. Morgan Securities LLC | $ | 30,000,000 | ||||||||||||||||||
| Morgan Stanley & Co. LLC | $ | 30,000,000 | ||||||||||||||||||
| PNC Capital Markets LLC | $ | 30,000,000 | ||||||||||||||||||
| Truist Securities, Inc. | $ | 30,000,000 | ||||||||||||||||||
| U.S. Bancorp Investments, Inc. | $ | 30,000,000 | ||||||||||||||||||
| FHN Financial Securities Corp. | $ | 12,500,000 | ||||||||||||||||||
Total | $ | 500,000,000 | ||||||||||||||||||
Schedule 2
Subsidiaries of Cousins Properties Incorporated
| Subsidiary | State of Organization | Company Percentage Ownership | |||||||||
| 101 South Tryon GP, LLC | Delaware | 100% | |||||||||
| 1230 Peachtree Associates LLC | Georgia | 100% | |||||||||
| 5950 Sherry Property, LLC | Delaware | 100% | |||||||||
| Austin 300 Colorado Investor, LLC | Georgia | 100% | |||||||||
| Austin 300 Colorado Project GP, LLC | Texas | 100% | |||||||||
| Austin 300 Colorado Project, LP | Texas | 100% | |||||||||
| Cousins 100 Mill Investor LLC | Georgia | 100% | |||||||||
| Cousins 1200 Peachtree LLC | Georgia | 100% | |||||||||
| Cousins 27 8th Street LLC | Georgia | 100% | |||||||||
| Cousins 200 East Bland LP | Georgia | 100% | |||||||||
| Cousins 200 South Coll. LP | Georgia | 100% | |||||||||
| Cousins 222 S. Mill, LLC | Delaware | 100% | |||||||||
| Cousins 3rd & Colorado LLC | Georgia | 100% | |||||||||
| Cousins 3rd W Peachtree LLC | Georgia | 100% | |||||||||
| Cousins 3WP Consulting LLC | Georgia | 100% | |||||||||
| Cousins 3WP Holdings LLC | Georgia | 100% | |||||||||
| Cousins 3060 Peachtree Sub, LLC | Delaware | 100% | |||||||||
| Cousins 550 South Caldwell, LP | Delaware | 100% | |||||||||
| Cousins 715 Ponce LLC | Delaware | 100% | |||||||||
2
| Cousins 725 Ponce LLC | Georgia | 100% | |||||||||
| Cousins 725 TRS LLC | Georgia | 100% | |||||||||
| Cousins 8th & West Peachtree LLC | Georgia | 100% | |||||||||
| Cousins 84 Twelfth Investor LLC | Georgia | 100% | |||||||||
| Cousins Acquisitions Entity LLC | Georgia | 100% | |||||||||
| Cousins Avalon 10000 LLC | Delaware | 100% | |||||||||
| Cousins Avalon 8000 LLC | Delaware | 100% | |||||||||
| Cousins Bland Street Land GP LLC | Georgia | 100% | |||||||||
| Cousins Bland Street Land LP | Georgia | 100% | |||||||||
| Cousins Block 185 LLC | Georgia | 100% | |||||||||
| Cousins Charlotte Lender LLC | Georgia | 100% | |||||||||
| Cousins Charlotte Lender Holdings LLC | Georgia | 100% | |||||||||
| Cousins Colorado Investor LLC | Georgia | 100% | |||||||||
| Cousins Colorado Land LLC | Georgia | 100% | |||||||||
| Cousins Dallas Lender LLC | Georgia | 100% | |||||||||
| Cousins Dallas Lender Holdings LLC | Georgia | 100% | |||||||||
| Cousins Decatur Development LLC | Georgia | 100% | |||||||||
| Cousins Employees LLC | Georgia | 100% | |||||||||
| Cousins Fareground Beverage Company, LLC | Texas | 100% | |||||||||
| Cousins Fareground Holding Company, LLC | Texas | 100% | |||||||||
| Cousins Fareground Management Company, LLC | Texas | 100% | |||||||||
| Cousins Fareground TRS, LLC | Texas | 100% | |||||||||
| Cousins FTC Charlotte LP | Georgia | 100% | |||||||||
3
| Cousins FTC Holding LLC | Georgia | 100% | |||||||||
| Cousins Nashville Lender LLC | Georgia | 100% | |||||||||
| Cousins Nashville Lender Holdings LLC | Georgia | 100% | |||||||||
| Cousins Fund II Buckhead, LLC | Delaware | 100% | |||||||||
| Cousins Fund II Phoenix I, LLC | Delaware | 100% | |||||||||
| Cousins Fund II Phoenix II, LLC | Delaware | 100% | |||||||||
| Cousins Fund II Phoenix III LLC | Delaware | 100% | |||||||||
| Cousins Fund II Phoenix IV, LLC | Delaware | 100% | |||||||||
| Cousins Fund II Phoenix V, LLC | Delaware | 100% | |||||||||
| Cousins Fund II Tampa II, LLC | Delaware | 100% | |||||||||
| Cousins Fund II Tampa III, LLC | Delaware | 100% | |||||||||
| Cousins Heights Union LLC | Georgia | 100% | |||||||||
| Cousins International Plaza I, LLC | Delaware | 100% | |||||||||
| Cousins International Plaza II, LLC | Delaware | 100% | |||||||||
| Cousins International Plaza III, LLC | Delaware | 100% | |||||||||
| Cousins International Plaza V Land, LLC | Delaware | 100% | |||||||||
| Cousins International Plaza VI Land, LLC | Delaware | 100% | |||||||||
| Cousins NC Gen Partner LLC | Georgia | 100% | |||||||||
| Cousins Neuhoff Investor LLC | Delaware | 100% | |||||||||
| Cousins Northpark 400 LLC | Georgia | 100% | |||||||||
| Cousins Northpark 500/600 LLC | Georgia | 100% | |||||||||
| Cousins One Capital City Plaza, LLC | Delaware | 100% | |||||||||
| Cousins - One Congress Plaza, LLC | Delaware | 100% | |||||||||
4
| Cousins Phoenix VI, LLC | Delaware | 100% | |||||||||
| Cousins Properties Foundation Inc. | Georgia | 100% | |||||||||
| Cousins Properties Sub Inc. | Maryland | 100% | |||||||||
| Cousins Proscenium Investor LLC | Georgia | 100% | |||||||||
| Cousins Railyard LP | Georgia | 100% | |||||||||
| Cousins Realty Services, LLC | Delaware | 100% | |||||||||
| Cousins Research Park V LLC | Georgia | 100% | |||||||||
| Cousins - San Jacinto Center, LLC | Delaware | 100% | |||||||||
| Cousins Spring & 8th Streets LLC | Georgia | 100% | |||||||||
| Cousins Spring & 8th Streets Parent LLC | Georgia | 100% | |||||||||
| Cousins Tampa Sub, LLC | Delaware | 100% | |||||||||
| Cousins TBP, LLC | Delaware | 100% | |||||||||
| Cousins Tremont Doggett LP | Georgia | 100% | |||||||||
| Cousins Tower Place 200, LLC | Delaware | 100% | |||||||||
| Cousins TRS Austin Amenities, LLC | Delaware | 100% | |||||||||
| Cousins TRS Services LLC | Georgia | 100% | |||||||||
| Cousins Vantage LP | Georgia | 100% | |||||||||
| Cousins W. Rio Salado, LLC | Delaware | 100% | |||||||||
| CPI Services LLC | Georgia | 100% | |||||||||
| Domain Junction 2 LLC | Delaware | 100% | |||||||||
| Domain Junction 7 LLC | Delaware | 100% | |||||||||
| Domain Junction 8 LLC | Delaware | 100% | |||||||||
| Meridian Mark Plaza, LLC | Georgia | 100% | |||||||||
5
| Murphy GP LLC | Georgia | 100% | |||||||||
| Murphy Subsidiary Holdings Corporation | Maryland | 100% | |||||||||
| One Briarlake Plaza Owner, LLC | Delaware | 100% | |||||||||
| Terminus Venture T100 LLC | Delaware | 100% | |||||||||
| Terminus Venture T200 LLC | Delaware | 100% | |||||||||
| Tier BT, Inc. | Delaware | 100% | |||||||||
| Tier Business Trust | Maryland | 100% | |||||||||
| Tier GP, Inc. | Delaware | 100% | |||||||||
| Tier Operating Partnership LP | Texas | 100% | |||||||||
| Tier Partners, LLC | Delaware | 100% | |||||||||
| Tier Property Management, LLC | Delaware | 100% | |||||||||
| TR 3354 Office Member, LLC | Delaware | 100% | |||||||||
| TR Domain 10, LLC | Delaware | 100% | |||||||||
| TR Domain 11, LLC | Delaware | 100% | |||||||||
| TR Domain 12, LLC | Delaware | 100% | |||||||||
| TR Domain 9, LLC | Delaware | 100% | |||||||||
| TR Domain, LLC | Delaware | 100% | |||||||||
| TR Domain Point Member, LLC | Delaware | 100% | |||||||||
| TR Legacy Circle, LLC | Delaware | 100% | |||||||||
| TR Legacy Member, LLC | Delaware | 100% | |||||||||
| TR Terrace GP, LLC | Delaware | 100% | |||||||||
| TR Terrace LP | Delaware | 100% | |||||||||
| Two Briarlake Plaza GP, LLC | Delaware | 100% | |||||||||
6
| Two Briarlake Plaza LP | Delaware | 100% | |||||||||
| Wanamaker Holdings, LLC | Delaware | 100% | |||||||||
7
Schedule 3
Joint Ventures of Cousins Properties Incorporated
Company Percentage Ownership | ||||||||||||||
Subsidiary | State of Organization | |||||||||||||
| 1308 Adams Street LLC | Delaware | 50% | ||||||||||||
| 715 Ponce Holdings LLC | Delaware | 50% | ||||||||||||
| 715 Ponce Owner LLC | Delaware | 50% | ||||||||||||
| 3354 Office/Condo, LLC | Delaware | 95% | ||||||||||||
| AMCO West Trinity Holdings, LLC | Delaware | 20% | ||||||||||||
| AMCO 120 West Trinity LLC | Georgia | 20% | ||||||||||||
| Crawford Long – CPI LLC | Georgia | 50% | ||||||||||||
| HICO 100 Mill LLC | Delaware | 90% | ||||||||||||
| Neuhoff Holdings LLC | Delaware | 50% | ||||||||||||
| Neuhoff Owner LLC | Delaware | 50% | ||||||||||||
| TL Proscenium Holdco LLC | Delaware | 20% | ||||||||||||
| TL CO Proscenium JV LLC | Delaware | 20% | ||||||||||||
| TL CO Proscenium Owner LLC | Delaware | 20% | ||||||||||||
| TL CO Proscenium TRS LLC | Delaware | 20% | ||||||||||||
| TR 3354 Office, LLC | Delaware | 95% | ||||||||||||
| TR Domain Point, LLC | Delaware | 96.5% | ||||||||||||
| TR Legacy Town Center, LLC | Delaware | 95% | ||||||||||||
8
Annex A
Time of Sale Information
• Pricing Term Sheet, dated May 28, 2025, substantially in the form of Annex B.
Annex B
Filed Pursuant to Rule 433
Registration Statement Nos. 333-279209 and 333-279209-01
Pricing Term Sheet
COUSINS PROPERTIES LP, AS ISSUER
COUSINS PROPERTIES INCORPORATED, AS GUARANTOR
Pricing Term Sheet
$500,000,000 5.250% Senior Notes due July 15, 2030
| Issuer: | Cousins Properties LP | ||||
| Guarantor: | Cousins Properties Incorporated | ||||
| Security Type: | Senior Unsecured Notes | ||||
| Principal Amount: | $500,000,000 | ||||
| Maturity: | July 15, 2030 | ||||
| Coupon: | 5.250% | ||||
| Public Offering Price: | 99.987% of the principal amount | ||||
| Yield to Maturity: | 5.251% | ||||
| Spread to Benchmark Treasury: | T+117 bps | ||||
| Benchmark Treasury: | 3.875% due April 30, 2030 | ||||
| Benchmark Treasury Price and Yield: | 99-02 3/4 / 4.081% | ||||
| Interest Payment Dates: | January 15 and July 15, commencing January 15, 2026 | ||||
| Redemption Provisions: | |||||
| Make-whole call: | Prior to June 15, 2030 (one month prior to the maturity date), at a discount rate of Treasury plus 20 basis points. | ||||
| Par Call: | On or after June 15, 2030 (one month prior to the maturity date), the redemption price will be equal to 100% of the principal amount of the notes being redeemed, plus accrued and unpaid interest thereon to, but not including, the redemption date. | ||||
| Trade Date: | May 28, 2025 | ||||
| Settlement: | T+7; June 6, 2025. Under Rule 15c6-1 under the Securities Exchange Act of 1934, trades in the secondary market are required to settle in one business day, unless the parties to any such trade expressly agree otherwise. Accordingly, purchasers who wish to trade the notes prior to the first business day preceding the closing date of this offering will be required, by virtue of the fact that the notes initially settle in T+7, to specify an alternate settlement arrangement at the time of any such trade to prevent a failed settlement. | ||||
| CUSIP: | 222793 AC5 | ||||
| ISIN: | US222793AC56 | ||||
| Ratings (Moody’s/S&P)*: | [Intentionally Omitted] | ||||
| Minimum Denomination: | $2,000 and integral multiples of $1,000 in excess thereof. | ||||
| Joint Book-Running Managers: | Wells Fargo Securities, LLC | ||||
BofA Securities, Inc. TD Securities (USA) LLC J.P. Morgan Securities LLC Morgan Stanley & Co. LLC PNC Capital Markets LLC Truist Securities, Inc. U.S. Bancorp Investments, Inc. | |||||
| Co-Manager: | FHN Financial Securities Corp. | ||||
*Note: A securities rating is not a recommendation to buy, sell or hold securities and may be revised or withdrawn at any time.
The issuer has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about the issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling Wells Fargo Securities, LLC at 1-800-645-3751, BofA Securities, Inc. at 1-800-294-1322, or TD Securities (USA) LLC at 1-855-495-9846.
Exhibit 4.2
Execution Version
______________________________________________________________________________
COUSINS PROPERTIES LP,
as Issuer
COUSINS PROPERTIES INCORPORATED,
as Parent Guarantor
and
U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION,
as Trustee
______________________________________________________________________________
THIRD SUPPLEMENTAL INDENTURE
DATED AS OF JUNE 6, 2025
TO THE INDENTURE
DATED AS OF MAY 8, 2024
______________________________________________________________________________
$500,000,000 5.250% SENIOR NOTES DUE 2030
TABLE OF CONTENTS
ARTICLE I RELATION TO BASE INDENTURE; DEFINITIONS | 1 | ||||||||||
| Section 1.1 | Relation to Base Indenture. | 1 | |||||||||
| Section 1.2 | Definitions. | 2 | |||||||||
ARTICLE II ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES | 8 | ||||||||||
| Section 2.1 | Issue of Notes. | 8 | |||||||||
| Section 2.2 | Form, Dating and Denominations; Legends. | 8 | |||||||||
| Section 2.3 | Execution and Authentication; Additional Notes. | 8 | |||||||||
| Section 2.4 | Registration, Transfer and Exchange. | 9 | |||||||||
ARTICLE III REDEMPTION OF NOTES | 12 | ||||||||||
| Section 3.1 | Optional Redemption of Notes. | 12 | |||||||||
| Section 3.2 | Notice of Optional Redemption, Selection of Notes. | 12 | |||||||||
| Section 3.3 | Payment of Notes Called for Redemption by the Issuer. | 14 | |||||||||
ARTICLE IV PROVISION OF FINANCIAL INFORMATION | 14 | ||||||||||
| Section 4.1 | Provision of Financial Information. | 14 | |||||||||
ARTICLE V COVENANTS | 15 | ||||||||||
| Section 5.1 | Existence. | 15 | |||||||||
| Section 5.2 | Maintenance of Properties. | 15 | |||||||||
| Section 5.3 | Insurance. | 16 | |||||||||
| Section 5.4 | Payment of Taxes and Other Claims. | 16 | |||||||||
ARTICLE VI MERGER, CONSOLIDATION OR SALE | 16 | ||||||||||
| Section 6.1 | Merger, Consolidation or Sale of the Issuer and the Parent Guarantor. | 16 | |||||||||
| Section 6.2 | Merger, Consolidation or Sale of a Subsidiary Guarantor. | 17 | |||||||||
| Section 6.3 | Exempted Transactions. | 18 | |||||||||
ARTICLE VII ADDITIONAL COVENANTS | 18 | ||||||||||
| Section 7.1 | Aggregate Debt. | 18 | |||||||||
| Section 7.2 | Secured Debt. | 19 | |||||||||
| Section 7.3 | Debt Service. | 19 | |||||||||
| Section 7.4 | Maintenance of Total Unencumbered Assets. | 20 | |||||||||
| Section 7.5 | Subsidiary Guarantors. | 20 | |||||||||
ARTICLE VIII DEFAULTS AND REMEDIES | 21 | ||||||||||
i
| Section 8.1 | Events of Default. | 21 | |||||||||
ARTICLE IX AMENDMENTS AND WAIVERS | 22 | ||||||||||
| Section 9.1 | Without Consent of Holders. | 22 | |||||||||
| Section 9.2 | With Consent of Holders. | 23 | |||||||||
ARTICLE X RELEASE OF GUARANTEE | 24 | ||||||||||
| Section 10.1 | Release of Guarantee of the Parent Guarantor. | 25 | |||||||||
| Section 10.2 | Release of Guarantee of a Subsidiary Guarantor. | 25 | |||||||||
ARTICLE XI MISCELLANEOUS PROVISIONS | 26 | ||||||||||
| Section 11.1 | Trust Indenture Act Controls. | 26 | |||||||||
| Section 11.2 | Integral Part. | 26 | |||||||||
| Section 11.3 | Governing Law. | 26 | |||||||||
| Section 11.4 | Counterparts. | 26 | |||||||||
| Section 11.5 | Successors and Assigns. | 27 | |||||||||
| Section 11.6 | Severability. | 27 | |||||||||
| Section 11.7 | Table of Contents, Headings, Etc. | 27 | |||||||||
| Section 11.8 | Ratifications. | 27 | |||||||||
| Section 11.9 | Effectiveness. | 27 | |||||||||
| Section 11.10 | The Trustee. | 28 | |||||||||
ii
THIS THIRD SUPPLEMENTAL INDENTURE (this “Third Supplemental Indenture”) is entered into as of June 6, 2025 among COUSINS PROPERTIES LP, a Delaware limited partnership (the “Issuer”), COUSINS PROPERTIES INCORPORATED, a Georgia corporation, the Issuer’s sole general partner (in the capacity as guarantor of the Notes (as defined below), the “Parent Guarantor”), each having its principal office at 3344 Peachtree Road NE, Suite 1800, Atlanta, Georgia 30326-4802, and U.S. Bank Trust Company, National Association, as trustee hereunder (the “Trustee”), having a Corporate Trust Office at 2 Concourse Parkway NE, Suite 800, Atlanta Georgia 30328.
WITNESSETH:
WHEREAS, the Issuer has delivered to the Trustee an Indenture, dated as of May 8, 2024 (the “Base Indenture”), providing for the issuance by the Issuer from time to time of Securities in one or more series;
WHEREAS, Section 301 of the Base Indenture provides for various matters with respect to any series of Securities issued under the Base Indenture to be established in an indenture supplemental to the Base Indenture;
WHEREAS, each of the Issuer and the Parent Guarantor desires to execute this Third Supplemental Indenture to establish the form and to provide for the issuance of a series of the Issuer’s senior notes designated as 5.250% Senior Notes due 2030 (the “Notes”), in an initial aggregate principal amount of $500,000,000;
WHEREAS, the Board of Directors of the Parent Guarantor, on behalf of the Parent Guarantor and in its capacity as the general partner of the Issuer, has duly adopted resolutions authorizing the Issuer and the Parent Guarantor to execute and deliver this Third Supplemental Indenture; and
WHEREAS, all of the other conditions and requirements necessary to make this Third Supplemental Indenture, when duly executed and delivered, a valid and binding agreement in accordance with its terms and for the purposes herein expressed, have been performed and fulfilled.
NOW, THEREFORE, for and in consideration of the premises and the purchase of the Notes by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders of the Notes, as follows:
ARTICLE I
RELATION TO BASE INDENTURE; DEFINITIONS
Section 1.1 Relation to Base Indenture.
This Third Supplemental Indenture constitutes an integral part of the Base Indenture. Notwithstanding any other provision of this Third Supplemental Indenture, all provisions of this Third Supplemental Indenture are expressly and solely for the benefit of the Holders of the Notes
1
and any such provisions shall not be deemed to apply to any other Securities issued under the Base Indenture and shall not be deemed to amend, modify or supplement the Base Indenture for any purpose other than with respect to the Notes.
Section 1.2 Definitions.
For all purposes of this Third Supplemental Indenture, except as otherwise expressly provided for or unless the context otherwise requires:
(a) capitalized terms used but not defined herein shall have the respective meanings assigned to them in the Base Indenture; and
(b) all references herein to Articles and Sections, unless otherwise specified, refer to the corresponding Articles and Sections of this Third Supplemental Indenture as they amend or supplement the Base Indenture, and not the Base Indenture or any other document.
“Acquired Debt” means Debt of a Person (i) existing at the time the Person becomes a Subsidiary or (ii) assumed in connection with the acquisition of assets from the Person, in each case, other than Debt incurred in connection with, or in contemplation of, the Person becoming a Subsidiary or the acquisition. Acquired Debt is deemed to be incurred on the date of the related acquisition of assets from any Person or the date the acquired Person becomes a Subsidiary.
“Agent Member” means a member of, or a participant in, the Depositary.
“Annual Debt Service Charge” means, for any period, without duplication, the aggregate amount of interest expense on Debt recorded in accordance with GAAP for such period of time by the Parent Guarantor and its Subsidiaries, but excluding (i) interest reserves funded from the proceeds of any loan, (ii) amortization of debt discount, premium and deferred financing costs, (iii) prepayment penalties, (iv) gains or losses on early extinguishment of debt and (v) non-cash swap ineffectiveness charges or charges attributable to transactions involving derivative instruments that do not qualify for hedge accounting in accordance with GAAP; and including, without limitation or duplication, effective interest in respect of original issue discount as determined in accordance with GAAP.
“Authentication Order” means an Issuer Order to the Trustee to authenticate and deliver the Notes, signed in the name of the Issuer by an Officer of the Parent Guarantor.
“Certificated Note” means a Note in registered individual form without interest coupons.
“Consolidated EBITDA” for any period means Consolidated Net Income of the Parent Guarantor and its Subsidiaries for such period, plus amounts which have been deducted and minus amounts that have been added for, without duplication:
(i) interest expense on Debt;
2
(ii) provision for taxes, including any increase or decrease in deferred taxes, based on income;
(iii) amortization of debt discount, premium and deferred financing costs;
(iv) the income or expense attributable to transactions involving derivative instruments that do not qualify for hedge accounting in accordance with GAAP;
(v) depreciation and amortization as set forth in the consolidated financial statements of the Parent Guarantor;
(vi) net amount of extraordinary items and non-recurring items, as may be determined by the Issuer in good faith (including, without limitation, all prepayment penalties and any costs and fees incurred in connection with any equity issuance, debt financing or amendments thereto, or any acquisition, disposition, recapitalization or similar transaction (regardless of whether such transaction is completed));
(vii) amortization of deferred charges;
(viii) gains or losses on early extinguishment of debt;
(ix) noncontrolling interests;
(x) provisions for unrealized gains and losses, impairment losses and gains and losses on sales or other dispositions of properties and other investments;
(xi) amortization or right-of-use assets associated with finance leases of property; and
(xii) credit losses recognized on financial assets and certain other instruments not measured at fair value,
all reasonably determined by the Issuer on a consolidated basis in accordance with GAAP, except to the extent GAAP is not applicable.
“Consolidated Net Income” for any period means the amount of net income (or loss) of the Parent Guarantor and its Subsidiaries for such period determined on a consolidated basis in accordance with GAAP.
“Debt” means, with respect to any Person, any:
(i) indebtedness of such Person in respect of borrowed money or evidenced by bonds, notes, debentures or similar instruments;
(ii) indebtedness secured by any Lien on any property or asset owned by such Person, but only to the extent of the lesser of (a) the amount of indebtedness so secured and (b) the fair market value (determined in good faith by the Issuer) of the property subject to such Lien;
3
(iii) reimbursement obligations, contingent or otherwise, in connection with any letters of credit actually issued or amounts representing the balance deferred and unpaid of the purchase price of any property except any such balance that constitutes an accrued expense or trade payable; or
(iv) any lease of property by such Person as lessee which is required to be reflected on such Person’s balance sheet as a finance lease in accordance with GAAP,
in the case of items of indebtedness under clauses (i) and (iii) above to the extent that any such items (other than letters of credit) would appear as liabilities on such Person’s balance sheet in accordance with GAAP; provided, however, that the term “Debt” will (1) include, to the extent not otherwise included, any non-contingent obligation of such Person to be liable for, or to pay, as obligor, guarantor or otherwise (other than for purposes of collection in the ordinary course of business), Debt of the types referred to above of another Person (other than the Parent Guarantor or any of its Subsidiaries); provided, however, that the term “Debt” shall not include Permitted Non-Recourse Guarantees of the Parent Guarantor or any of its Subsidiaries until they become primary obligations of, and payments are due and required to be made thereunder by, the Parent Guarantor or any of its Subsidiaries; (2) exclude any such indebtedness (or obligations referenced in clause (1) above) that has been the subject of an “in substance” defeasance in accordance with GAAP; and (3) exclude Intercompany Indebtedness that is subordinate in right of payment to the Notes (or an obligation to be liable for, or to pay, Intercompany Indebtedness that is subordinate in right of payment to the Notes). In the case of indebtedness under clause (iv) above, the term “Debt” will exclude operating lease liabilities on such Person’s balance sheet in accordance with GAAP.
“Depositary” means, with respect to the Notes, DTC and any successor thereto.
“Event of Default” shall have the meaning ascribed thereto in Section 8.1.
“Global Note” means a Note in registered global form without interest coupons.
“Guarantors” means collectively the Parent Guarantor and each Subsidiary Guarantor, if any.
“Indenture” means the Base Indenture, as supplemented by this Third Supplemental Indenture, and as may be further supplemented, amended or restated.
“Intercompany Indebtedness” means Debt to which the only parties are any of the Issuer, the Parent Guarantor or any of their respective Subsidiaries; provided, however, that with respect to any such Debt of which the Issuer or the Parent Guarantor is the borrower, such Debt is subordinate in right of payment to the Notes.
“Issue Date” means June 6, 2025.
“Lien” means any mortgage, pledge, lien, charge, encumbrance or any security interest existing on property owned by the Parent Guarantor or any of its Subsidiaries securing Debt, other than a Permitted Lien.
4
“Non-Recourse Debt” means Debt of a joint venture or Subsidiary of the Issuer (or an entity in which the Issuer is the general partner or managing member) that is directly or indirectly secured by real estate assets or other real estate-related assets (including equity interests) of the joint venture or Subsidiary of the Issuer (or entity in which the Issuer is the general partner or managing member) that is the borrower and is non-recourse to the Parent Guarantor or any of its Subsidiaries (other than pursuant to a Permitted Non-Recourse Guarantee and other than with respect to the joint venture or Subsidiary of the Issuer (or entity in which the Issuer is the general partner or managing member) that is the borrower); provided that, if any such Debt is partially recourse to the Parent Guarantor or any of its Subsidiaries (other than pursuant to a Permitted Non-Recourse Guarantee and other than with respect to the joint venture or Subsidiary of the Issuer (or entity in which the Issuer is the general partner or managing member) that is the borrower) and therefore does not meet the criteria set forth above, only the portion of such Debt that does meet the criteria set forth above shall constitute “Non-Recourse Debt.”
“Par Call Date” means June 15, 2030.
“Permitted Lien” means an operating lease, Lien securing taxes, assessments and similar charges, mechanics’ lien and other similar Liens and any Lien that secures Debt of the Parent Guarantor or any of its Subsidiaries owed to the Issuer.
“Permitted Non-Recourse Guarantees” means customary completion or budget guarantees, indemnities or other customary guarantees provided to lenders (including by means of separate indemnification agreements, carve-out guarantees or pledges of the equity interests in the borrower) under such Non-Recourse Debt in the ordinary course of business of the Parent Guarantor or any of its Subsidiaries in financing transactions that are directly or indirectly secured by real estate assets or other real estate-related assets (including equity interests) of a joint venture or Subsidiary of the Issuer (or an entity in which the Issuer is the general partner or managing member), in each case that is the borrower in such financing, but is non-recourse to the Parent Guarantor or any of its other Subsidiaries, except for such completion or budget guarantees, indemnities or other guarantees (including by means of separate indemnification agreements or carve-out guarantees or pledges of the equity interests in the borrower) as are consistent with customary industry practice (such as environmental indemnities and recourse triggers based on violation of transfer restrictions and other customary exceptions to non-recourse liability).
“SEC” means the Securities and Exchange Commission, as from time to time constituted, created under the Exchange Act or, if at any time after the execution of the Indenture the SEC is not existing and performing the duties now assigned to it under the Securities Act, the Exchange Act or the Trust Indenture Act, as the case may be, then the body or respective bodies performing such duties on such date.
“Subsidiary” means, with respect to the Issuer or the Parent Guarantor, any Person (as defined in the Base Indenture but excluding an individual), a majority of the outstanding voting stock, partnership interests, membership interests or other equity interests, as the case may be, of which is owned or controlled, directly or indirectly, by the Issuer or the Parent Guarantor, as the case may be, or by one or more other Subsidiaries of the Issuer or the Parent Guarantor, as the case may be. For the purposes of this definition, “voting stock, partnership interests, membership
5
interests or other equity interests” means stock or interests having voting power for the election of directors, trustees or managers, as the case may be, whether at all times or only so long as no senior class of stock or interests has such voting power by reason of any contingency.
“Subsidiary Guarantor” shall have the meaning ascribed thereto in Section 7.5.
“Total Assets” means the sum of, without duplication:
(i) Undepreciated Real Estate Assets; and
(ii) all other assets (excluding accounts receivable, right-of-use operating lease assets and non-real estate intangibles) of the Parent Guarantor and its Subsidiaries,
all determined on a consolidated basis in accordance with GAAP.
“Total Unencumbered Assets” means the sum of, without duplication:
(i) those Undepreciated Real Estate Assets that are not subject to a Lien securing Debt; and
(ii) all other assets (excluding accounts receivable and non-real estate intangibles) of the Parent Guarantor and its Subsidiaries that are not subject to a Lien securing Debt,
all determined on a consolidated basis in accordance with GAAP; provided, however, that in determining Total Unencumbered Assets as a percentage of outstanding Unsecured Debt for purposes of Section 7.4, all investments by the Parent Guarantor or any of its Subsidiaries in unconsolidated limited partnerships, unconsolidated limited liability companies and other unconsolidated entities shall be excluded from Total Unencumbered Assets. For the avoidance of doubt, cash held by a “qualified intermediary” in connection with proposed like-kind exchanges pursuant to Section 1031 of the Internal Revenue Code of 1986, as amended, which may be classified as “restricted” for purposes of GAAP, will nonetheless be considered Total Unencumbered Assets, so long as the Parent Guarantor or a Subsidiary thereof has the right to (1) direct the qualified intermediary to return such cash to the Parent Guarantor or a Subsidiary thereof if and when the Parent Guarantor or a Subsidiary thereof fails to identify or acquire the proposed like-kind property or at the end of the 180-day replacement period or (2) direct the qualified intermediary to use such cash to acquire like-kind property.
“Treasury Rate” means, with respect to any Redemption Date, the yield determined by the Issuer in accordance with the following two paragraphs.
The Treasury Rate shall be determined by the Issuer after 4:15 p.m., New York City time (or after such time as yields on U.S. government securities are posted daily by the Board of Governors of the Federal Reserve System), on the third Business Day preceding the date the notice of redemption is given based upon the yield or yields for the most recent day that appear after such time on such day in the most recent statistical release published by the Board of Governors of the Federal Reserve System designated as “Selected Interest Rates (Daily)—H.15” (or any successor
6
designation or publication) (“H.15”) under the caption “U.S. government securities–Treasury constant maturities–Nominal” (or any successor caption or heading) (“H.15 TCM”). In determining the Treasury Rate, the Issuer shall select, as applicable: (1) the yield for the Treasury constant maturity on H.15 exactly equal to the period from the Redemption Date to the Par Call Date (the “Remaining Life”); or (2) if there is no such Treasury constant maturity on H.15 exactly equal to the Remaining Life, the two yields—one yield corresponding to the Treasury constant maturity on H.15 immediately shorter than and one yield corresponding to the Treasury constant maturity on H.15 immediately longer than the Remaining Life—and shall interpolate to the Par Call Date on a straight-line basis (using the actual number of days) using such yields and rounding the result to three decimal places; or (3) if there is no such Treasury constant maturity on H.15 shorter than or longer than the Remaining Life, the yield for the single Treasury constant maturity on H.15 closest to the Remaining Life. For purposes of this paragraph, the applicable Treasury constant maturity or maturities on H.15 shall be deemed to have a maturity date equal to the relevant number of months or years, as applicable, of such Treasury constant maturity from the Redemption Date.
If on the third Business Day preceding the date the notice of redemption is given H.15 TCM is no longer published, the Issuer shall calculate the Treasury Rate based on the rate per annum equal to the semi-annual equivalent yield to maturity at 11:00 a.m., New York City time, on the second Business Day preceding the date the notice of redemption is given of the United States Treasury security maturing on, or with a maturity that is closest to, the Par Call Date, as applicable. If there is no United States Treasury security maturing on the Par Call Date but there are two or more United States Treasury securities with a maturity date equally distant from the Par Call Date, one with a maturity date preceding the Par Call Date and one with a maturity date following the Par Call Date, the Issuer shall select the United States Treasury security with a maturity date preceding the Par Call Date. If there are two or more United States Treasury securities maturing on the Par Call Date or two or more United States Treasury securities meeting the criteria of the preceding sentence, the Issuer shall select from among these two or more United States Treasury securities the United States Treasury security that is trading closest to par based upon the average of the bid and asked prices for such United States Treasury securities at 11:00 a.m., New York City time. In determining the Treasury Rate in accordance with the terms of this paragraph, the semi-annual yield to maturity of the applicable United States Treasury security shall be based upon the average of the bid and asked prices (expressed as a percentage of principal amount) at 11:00 a.m., New York City time, of such United States Treasury security, and rounded to three decimal places.
“Triggering Indebtedness” means indebtedness under (i) the Fifth Amended and Restated Credit Agreement, dated as of May 2, 2022, among the Issuer, as borrower, the Parent Guarantor, as parent and guarantor, certain consolidated entities of the Parent Guarantor designated as co-borrowers and/or guarantors, JPMorgan Chase Bank, N.A., as syndication agent, Bank of America, N.A., as administrative agent, and the other lending institutions that are parties thereto, as documentation agents and lenders and (ii) the Delayed Draw Term Loan Agreement, dated as of October 3, 2022, among the Issuer, as borrower, the Parent Guarantor, as parent and guarantor, certain consolidated entities of the Parent Guarantor designated as co-borrowers and/or guarantors, JPMorgan Chase Bank, N.A., as syndication agent, Bank of America, N.A., as administrative agent, and the other lending institutions that are parties thereto, as documentation agents and
7
lenders, each as amended, supplemented, modified, extended, restructured, renewed, refinanced, restated, refunded or replaced (in whole or in part, including with any new credit agreement or credit facility) from time to time.
“Undepreciated Real Estate Assets” means, as of any date, the cost (original cost plus capital improvements) of real estate assets, loans secured by real estate assets, right of use assets associated with finance leases in accordance with GAAP and related intangibles of the Parent Guarantor and its Subsidiaries on such date, before depreciation and amortization, all determined on a consolidated basis in accordance with GAAP; provided, however, that Undepreciated Real Estate Assets shall not include the right of use assets associated with an operating lease in accordance with GAAP.
“Unsecured Debt” means Debt of the Parent Guarantor or any of its Subsidiaries which is not secured by a Lien on any property or assets of the Parent Guarantor or any of its Subsidiaries.
ARTICLE II
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES
Section 2.1 Issue of Notes.
A new series of Securities is to be issued under the Base Indenture as supplemented by this Third Supplemental Indenture. The series shall be titled the “5.250% Senior Notes due 2030.”
Section 2.2 Form, Dating and Denominations; Legends.
The Notes and the Trustee’s certificate of authentication will be substantially in the form attached as Exhibit A. The terms and provisions contained in the form of the Notes annexed as Exhibit A constitute, and are hereby expressly made, a part of the Base Indenture and this Third Supplemental Indenture. The Notes may have notations, legends or endorsements required by law, rules of or agreements with national securities exchanges to which the Issuer is subject, or usage.
Section 2.3 Execution and Authentication; Additional Notes.
(a) The aggregate principal amount of Notes which may be authenticated and delivered under the Indenture is unlimited; provided that upon initial issuance on the date hereof the aggregate principal amount of Notes outstanding shall not exceed $500,000,000, except for Notes issued upon exchange or registration of transfer of other Notes as provided herein and except as provided in Sections 2.4 and 3.3(b). The Issuer may, without the consent of Holders of Notes, increase the principal amount of the Notes by issuing additional Notes in the future on the same terms and conditions, except for any difference in the issue date, issue price, Interest accrued prior to the issue date of the additional Notes and, if applicable, the first Interest Payment Date and the initial Interest accrual date, with the same CUSIP number as the Notes issued on the date hereof, so long as such additional Notes are fungible with the Notes issued on the date hereof for United States federal income tax purposes and shall carry the same right to receive accrued and unpaid Interest as the other Notes then outstanding; provided, however, that, notwithstanding the foregoing, (i) if the additional Notes are not fungible with the Notes for United States federal
8
income tax purposes, the additional Notes will have a separate CUSIP number and (ii) if the Issuer has effected legal defeasance or covenant defeasance with respect to the Notes pursuant to Section 402 of the Base Indenture or has effected satisfaction and discharge with respect to the Notes pursuant to Section 401 of the Base Indenture, no additional Notes may be issued. The Notes issued on the date hereof and any such additional Notes shall constitute a single series of debt Securities, and in circumstances in which the Indenture provides for the Holders of Notes to vote or take any action, the Holders of the Notes issued on the date hereof and any such additional Notes will vote or take that action as a single class.
(b) At any time and from time to time after the execution and delivery of this Third Supplemental Indenture, the Issuer may deliver Notes executed by the Issuer to the Trustee for authentication. The Trustee will authenticate and deliver:
(i) Notes for original issue in the aggregate principal amount not to exceed $500,000,000; and
(ii) additional Notes from time to time for original issue in aggregate principal amounts specified by the Issuer.
Section 2.4 Registration, Transfer and Exchange.
(a) The Notes will be issued in registered form only, without coupons, and the Issuer shall cause the Trustee to maintain a Security Register of the Notes, for registering the record ownership of the Notes by the Holders and transfers and exchanges of the Notes.
(b) (i) Each Global Note will be registered in the name of the Depositary or its nominee and, so long as DTC is serving as the Depositary thereof, will bear the following legend:
THIS SECURITY IS A GLOBAL NOTE WITHIN THE MEANING SET FORTH IN THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND, UNLESS AND UNTIL IT IS EXCHANGED FOR SECURITIES IN DEFINITIVE FORM AS AFORESAID, MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ITS NOMINEE TO A SUCCESSOR DEPOSITARY OR ITS NOMINEE.
(ii) Each Global Note will be delivered to the Trustee as custodian for the Depositary. Transfers of a Global Note (but not a beneficial interest therein) will be limited to transfers thereof in whole, but not in part, to the Depositary, its successors or their respective nominees, except (1) as set forth in Section 2.4(b)(iv) and (2) transfers of portions thereof in the form of Certificated Notes may be made upon request of an Agent Member (for itself or on behalf
9
of a beneficial owner) by written notice given to the Trustee by or on behalf of the Depositary in accordance with customary procedures of the Depositary and in compliance with this Section.
(iii) Agent Members will have no rights under the Indenture with respect to any Global Note held on their behalf by the Depositary, and the Depositary may be treated by the Issuer, the Trustee and any agent of the Issuer or the Trustee as the absolute owner and Holder of such Global Note for all purposes whatsoever. Notwithstanding the foregoing, the Depositary or its nominee may grant proxies and otherwise authorize any Person (including any Agent Member and any Person that holds a beneficial interest in a Global Note through an Agent Member) to take any action which a Holder is entitled to take under the Indenture or the Notes, and nothing herein will impair, as between the Depositary and its Agent Members, the operation of customary practices governing the exercise of the rights of a holder of any Security.
(iv) If (x) the Depositary notifies the Issuer that it is unwilling or unable to continue as Depositary for a Global Note and a successor depositary is not appointed by the Issuer within 90 days of the notice or (y) an Event of Default has occurred and is continuing and the Trustee has received a request from the Depositary, the Trustee will promptly exchange each beneficial interest in the Global Note for one or more Certificated Notes in authorized denominations having an equal aggregate principal amount registered in the name of the owner of such beneficial interest, as identified to the Trustee by the Depositary, and thereupon the Global Note will be deemed canceled.
(c) Each Certificated Note will be registered in the name of the Holder thereof or its nominee.
(d) A Holder may transfer a Note (or a beneficial interest therein) to another Person or exchange a Note (or a beneficial interest therein) for another Note or Notes of any authorized denomination by presenting to the Trustee a written request therefor stating the name of the proposed transferee or requesting such an exchange, accompanied by any certification, opinion or other document as the Trustee may reasonably request. The Trustee will promptly register any transfer or exchange that meets the requirements of this Section by noting the same in the Security Register maintained by the Trustee for the purpose; provided that:
(i) no transfer or exchange will be effective until it is registered in such Security Register; and
(ii) the Trustee will not be required (x) to issue, register the transfer of or exchange any Note for a period of 15 days before any selection of Notes for redemption, (y) to register the transfer of or exchange any Note so selected for redemption or purchase in whole or in part, except, in the case of a partial redemption or purchase, that portion of any Note not being redeemed or purchased, or (z) if a redemption is to occur after a Regular Record Date but on or before the corresponding Interest Payment Date, to register the transfer of or exchange any Note on or after the Regular Record Date and before the date of redemption or purchase. Prior to the registration of any transfer, the Issuer, the Trustee and their agents will treat the Person in whose name the Note is registered as the owner and Holder thereof for all purposes (whether or not the Note is overdue), and will not be affected by notice to the contrary.
10
From time to time the Issuer will execute and the Trustee will authenticate additional Notes as necessary in order to permit the registration of a transfer or exchange in accordance with this Section.
No service charge will be imposed in connection with any transfer or exchange of any Note, but the Issuer may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith (other than a transfer tax or other similar governmental charge payable upon exchange pursuant to subsection (b)(iv)).
(e) (i) Global Note to Global Note. If a beneficial interest in a Global Note is transferred or exchanged for a beneficial interest in another Global Note, the Trustee will (x) record a decrease in the principal amount of the Global Note being transferred or exchanged equal to the principal amount of such transfer or exchange and (y) record a like increase in the principal amount of the other Global Note. Any beneficial interest in one Global Note that is transferred to a Person who takes delivery in the form of an interest in another Global Note, or exchanged for an interest in another Global Note, will, upon transfer or exchange, cease to be an interest in such Global Note and become an interest in the other Global Note and, accordingly, will thereafter be subject to all transfer and exchange restrictions, if any, and other procedures applicable to beneficial interests in such other Global Note for as long as it remains such an interest.
(ii) Global Note to Certificated Note. If a beneficial interest in a Global Note is transferred or exchanged for a Certificated Note, the Trustee will (x) record a decrease in the principal amount of such Global Note equal to the principal amount of such transfer or exchange and (y) deliver one or more new Certificated Notes in authorized denominations having an equal aggregate principal amount to the transferee (in the case of a transfer) or the owner of such beneficial interest (in the case of an exchange), registered in the name of such transferee or owner, as applicable.
(iii) Certificated Note to Global Note. If a Certificated Note is transferred or exchanged for a beneficial interest in a Global Note, the Trustee will (x) cancel such Certificated Note, (y) record an increase in the principal amount of such Global Note equal to the principal amount of such transfer or exchange and (z) in the event that such transfer or exchange involves less than the entire principal amount of the canceled Certificated Note, deliver to the Holder thereof one or more new Certificated Notes in authorized denominations having an aggregate principal amount equal to the untransferred or unexchanged portion of the canceled Certificated Note, registered in the name of the Holder thereof.
(iv) Certificated Note to Certificated Note. If a Certificated Note is transferred or exchanged for another Certificated Note, the Trustee will (x) cancel the Certificated Note being transferred or exchanged, (y) deliver one or more new Certificated Notes in authorized denominations having an aggregate principal amount equal to the principal amount of such transfer or exchange to the transferee (in the case of a transfer) or the Holder of the canceled Certificated Note (in the case of an exchange), registered in the name of such transferee or Holder, as applicable, and (z) if such transfer or exchange involves less than the entire principal amount of the canceled Certificated Note, deliver to the Holder thereof one or more Certificated Notes in authorized denominations having an aggregate principal amount equal to the untransferred or
11
unexchanged portion of the canceled Certificated Note, registered in the name of the Holder thereof.
ARTICLE III
REDEMPTION OF NOTES
The provisions of Article 11 of the Base Indenture, as amended by the provisions of this Article III, shall apply with respect to the Notes and the Guarantee.
Section 3.1 Optional Redemption of Notes.
(a) Prior to the Par Call Date, the Issuer may redeem the Notes at its option, in whole or in part, at any time and from time to time, at a Redemption Price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of:
(i) (x) the sum of the present values of the remaining scheduled payments of principal and Interest thereon discounted to the Redemption Date (assuming the Notes matured on the Par Call Date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 20 basis points less (y) Interest accrued to the Redemption Date; and
(ii) 100% of the principal amount of the Notes to be redeemed,
plus, in either case, accrued and unpaid Interest thereon to the Redemption Date.
(b) On or after the Par Call Date, the Issuer may redeem the Notes, in whole or in part, at any time and from time to time, at a Redemption Price equal to 100% of the principal amount of the Notes being redeemed plus accrued and unpaid Interest thereon to the Redemption Date. The Issuer’s actions and determinations in determining the Redemption Price shall be conclusive and binding for all purposes, absent manifest error.
Section 3.2 Notice of Optional Redemption, Selection of Notes.
(a) In case the Issuer shall desire to exercise the right to redeem all or, as the case may be, any part of the Notes pursuant to Section 3.1, it shall fix a date for redemption and it or, at its written request received by the Trustee not fewer than two Business Days prior (or such shorter period of time as may be acceptable to the Trustee) to the date the notice of redemption is to be mailed or electronically delivered (or otherwise transmitted in accordance with the Depositary’s procedures), the Trustee in the name of and at the expense of the Issuer, shall mail or electronically deliver (or otherwise transmit in accordance with the Depositary’s procedures), or cause to be mailed or electronically delivered (or otherwise transmitted in accordance with the Depositary’s procedures), a notice of such redemption at least 10 days but not more than 60 days prior to the Redemption Date to each Holder of Notes to be redeemed; provided that if the Issuer makes such request of the Trustee, it shall, together with such request, also give written notice of the Redemption Date to the Trustee; provided further that the text of the notice shall be prepared by the Issuer. The notice, if mailed, electronically delivered or otherwise transmitted in the manner
12
herein provided, shall be conclusively presumed to have been duly given, whether or not the Holder receives such notice. In any case, failure to give such notice by mail or electronic submission or any defect in the notice to the Holder of any Note designated for redemption as a whole or in part shall not affect the validity of the proceedings for the redemption of any other Note.
(b) Each such notice of redemption shall specify:
(i) the aggregate principal amount of Notes to be redeemed;
(ii) the CUSIP number or numbers of the Notes being redeemed;
(iii) the Redemption Date (which shall be a Business Day);
(iv) the Redemption Price (or the method of calculating such Redemption Price) at which Notes are to be redeemed;
(v) the place or places of payment and that payment will be made upon presentation and surrender of such Notes; and
(vi) that Interest accrued and unpaid to, but excluding, the Redemption Date will be paid as specified in said notice, and that, unless the Issuer defaults in the payment of the Redemption Price, on and after the Redemption Date Interest will cease to accrue on the Notes or portions thereof called for redemption.
(c) On or prior to the Redemption Date specified in the notice of redemption given as provided in this Section 3.2, the Issuer will deposit with the Paying Agent (or, if the Issuer is acting as its own Paying Agent, set aside, segregate and hold in trust as provided in Section 311 of the Base Indenture) an amount of money in immediately available funds sufficient to redeem on the Redemption Date all the Notes (or portions thereof) so called for redemption at the appropriate Redemption Price, together with accrued and unpaid Interest, if any, on the Notes or portions thereof to be redeemed; provided that if such payment is made on the Redemption Date, it must be received by the Paying Agent by 11:00 a.m., New York City time, on such date. The Issuer shall be entitled to retain any interest, yield or gain on amounts deposited with the Paying Agent pursuant to this Section 3.2 in excess of amounts required hereunder to pay the Redemption Price (it being acknowledged that the Trustee has no obligation to invest any such deposit).
(d) In the case of a partial redemption, selection of the Notes for redemption will be made pro rata, by lot or by such other method as the Trustee in its sole discretion deems appropriate and fair. No Notes of a principal amount of $2,000 or less will be redeemed in part. If any Note is to be redeemed in part only, the notice of redemption that relates to the Note will state the portion of the principal amount of the Note to be redeemed. A new Note in a principal amount equal to the unredeemed portion of the Note will be issued in the name of the Holder of the Note upon surrender for cancellation of the original Note. For so long as the Notes are held by DTC (or another Depositary), the redemption of the Notes shall be done in accordance with the policies and procedures of the Depositary.
13
Section 3.3 Payment of Notes Called for Redemption by the Issuer.
(a) If notice of redemption has been given as provided in Section 3.2, the Notes or portion of Notes with respect to which such notice has been given shall become due and payable on the Redemption Date and at the place or places stated in such notice at the Redemption Price, together with accrued and unpaid Interest, if any, thereon, and unless the Issuer defaults in the payment of the Redemption Price and accrued Interest on the Notes (or portions thereof) called for redemption on a Redemption Date, so long as the Paying Agent holds funds irrevocably deposited with it sufficient to pay the Redemption Price of the Notes to be redeemed on the Redemption Date, then (i) such Notes will cease to be Outstanding on and after the date of the deposit, (ii) Interest on the Notes or portion of Notes so called for redemption shall cease to accrue on and after the Redemption Date, and (iii) the Holders of the Notes being redeemed shall have no right in respect of such Notes except the right to receive the Redemption Price thereof. On presentation and surrender of such Notes at a place of payment in said notice specified, the said Notes or the specified portions thereof shall be paid and redeemed by the Issuer at the Redemption Price, together with Interest accrued thereon to, but excluding, the Redemption Date.
(b) Upon presentation of any Note redeemed in part only, the Issuer shall execute and the Trustee shall, upon receipt of an Authentication Order, authenticate and make available for delivery to the Holder thereof, at the expense of the Issuer, a new Note or Notes, of authorized denominations, in principal amount equal to the unredeemed portion of the Notes so presented.
(c) Prior to the applicable Redemption Date, the Issuer shall provide to the Trustee an Officers’ Certificate that shall set forth the applicable Redemption Price and the calculation thereof in reasonable detail. The Issuer’s actions and determinations in determining the Redemption Price shall be conclusive and binding for all purposes, absent manifest error. The Trustee shall be under no duty to inquire into, may conclusively presume the correctness of, and shall be fully protected in acting upon the Issuer’s calculation of the Redemption Price. The Trustee shall provide such calculation to any Holder upon request.
ARTICLE IV
PROVISION OF FINANCIAL INFORMATION
Section 4.1 hereof shall replace Section 703 of the Base Indenture with respect to the Notes and the Guarantee.
Section 4.1 Provision of Financial Information.
For so long as any Notes are Outstanding, if the Parent Guarantor is subject to Section 13(a) or 15(d) of the Exchange Act or any successor provision, the Parent Guarantor shall deliver to the Trustee the annual reports, quarterly reports and other documents which it is required to file with the SEC pursuant to Section 13(a) or 15(d) or any successor provision, within 15 days after the date that the Parent Guarantor files the same with the SEC. If the Parent Guarantor is not subject to Section 13(a) or 15(d) of the Exchange Act or any successor provision, and for so long
14
as any Notes are Outstanding, the Issuer shall deliver to the Trustee within 15 days of the filing date that would be applicable to a non-accelerated filer at that time pursuant to applicable SEC rules and regulations, the quarterly and annual financial statements and accompanying Item 303 of Regulation S-K (“management’s discussion and analysis of financial condition and results of operations”) disclosure that would be required to be contained in annual reports on Form 10-K and quarterly reports on Form 10-Q, respectively, had the Issuer been subject to Section 13(a) or 15(d) of the Exchange Act or any successor provision.
Reports and other documents filed with the SEC via the EDGAR system will be deemed to be delivered to the Trustee as of the time of such filing via EDGAR for purposes of this Section 4.1; provided, however, that the Trustee shall have no obligation whatsoever to determine whether or not such information, documents or reports have been filed via EDGAR. Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Parent Guarantor’s compliance with any of its covenants relating to the Notes (as to which the Trustee is entitled to rely exclusively on an Officers’ Certificate).
ARTICLE V
COVENANTS
Sections 5.1, 5.2, 5.3 and 5.4 hereof shall replace Sections 1004, 1005, 1006 and 1007, respectively, of the Base Indenture with respect to the Notes and the Guarantee.
Section 5.1 Existence.
Except as permitted by Section 6.1, the Parent Guarantor shall do or cause to be done all things necessary to preserve and keep in full force and effect its, the Issuer’s and each Subsidiary Guarantor’s existence, rights (charter and statutory) and franchises. However, none of the Parent Guarantor, the Issuer or any Subsidiary Guarantor shall be required to preserve any right or franchise if the Parent Guarantor’s Board of Directors (or any duly authorized committee of that Board of Directors), as the case may be, determines that the preservation of the right or franchise is no longer desirable in the conduct of its, the Issuer’s or such Subsidiary Guarantor’s business.
Section 5.2 Maintenance of Properties.
The Parent Guarantor shall cause all of its material properties used or useful in the conduct of its business or any of its Subsidiaries’ businesses to be maintained and kept in good condition, repair and working order, normal wear and tear, casualty and condemnation excepted, and supplied with all necessary equipment and cause all necessary repairs, renewals, replacements, betterments and improvements to be made, all as in the Parent Guarantor’s judgment may be necessary in order for it to at all times properly and advantageously conduct its business carried on in connection with such properties. The Parent Guarantor and its Subsidiaries shall not be prevented from (1) removing permanently any property that has been condemned or suffered a casualty loss, if it is in the Parent Guarantor’s or its Subsidiaries’ best interest, (2) discontinuing maintenance or operation
15
of any property if, in the Parent Guarantor’s or its Subsidiaries’ reasonable judgment, doing so is in the Parent Guarantor’s or its Subsidiaries’ best interest and is not disadvantageous in any material respect to the Holders of the Notes, or (3) selling or otherwise disposing for value the Parent Guarantor’s or its Subsidiaries’ properties in the ordinary course of business.
Section 5.3 Insurance.
The Parent Guarantor shall, and shall cause each of its Subsidiaries to, keep in force upon all of its and each of its Subsidiaries’ properties and operations insurance policies carried with responsible companies in such amounts and covering all such risks as is customary in the industry in which the Parent Guarantor and its Subsidiaries do business in accordance with prevailing market conditions and availability.
Section 5.4 Payment of Taxes and Other Claims.
Each of the Issuer and the Parent Guarantor shall pay or discharge or cause to be paid or discharged, before the same shall become delinquent, all taxes, assessments and governmental charges levied or imposed on it or any of its Subsidiaries or on its or any such Subsidiary’s income, profits or property and all lawful claims for labor, materials and supplies that, if unpaid, might by law become a Lien upon its property or the property of any of its Subsidiaries; provided, however, that the Issuer and the Parent Guarantor shall not be required to pay or discharge or cause to be paid or discharged any tax, assessment, charge or claim the amount, applicability or validity of which is being contested in good faith.
ARTICLE VI
MERGER, CONSOLIDATION OR SALE
Article VI hereof shall replace Article 8 of the Base Indenture with respect to the Notes and the Guarantee.
Section 6.1 Merger, Consolidation or Sale of the Issuer and the Parent Guarantor.
(a) The Issuer and the Parent Guarantor may merge or consolidate with or into, or sell, assign, convey, transfer or lease all or substantially all of the Issuer’s or the Parent Guarantor’s respective property and assets to any other entity, provided that the following conditions are met:
(i) the Issuer or the Parent Guarantor, as the case may be, shall be the continuing entity, or the successor entity (if other than the Issuer or the Parent Guarantor, as the case may be) formed by or resulting from any merger or consolidation or which shall have received the sale, assignment, conveyance, transfer or lease of property and assets shall be domiciled in the United States, any state thereof or the District of Columbia and, in the case of the Issuer, shall expressly assume payment of the principal of (and premium, if any) and Interest on all of the Notes and the due and punctual performance and observance of all of the covenants and conditions in the Indenture or, in the case of the Parent Guarantor, shall expressly assume the payment of all amounts due under its Guarantee and the due and punctual performance and observance of all of
16
the covenants and conditions of the Parent Guarantor in the Indenture and its Guarantee, as the case may be;
(ii) immediately after giving effect to the transaction, no Event of Default, and no event which, after notice or the lapse of time, or both, would become an Event of Default, shall have occurred and be continuing; and
(iii) an Officers’ Certificate and Opinion of Counsel shall be delivered to the Trustee, each stating that such transaction and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture comply with the Indenture and that all conditions precedent provided for relating to such transaction have been complied with.
(b) In the event of any transaction described in and complying with the conditions listed in this Section 6.1 in which neither the Issuer nor the Parent Guarantor is the continuing entity, the successor Person formed or remaining shall succeed, and be substituted for, and may exercise every right and power of the Issuer or the Parent Guarantor, as the case may be, and (except in the case of a lease) the Issuer and/or the Parent Guarantor shall be discharged from its or their obligations, as the case may be, under the Notes, the Guarantee and the Indenture.
Section 6.2 Merger, Consolidation or Sale of a Subsidiary Guarantor.
(a) Each Subsidiary Guarantor (if any) may merge or consolidate with or into, or sell, assign, convey, transfer or lease all or substantially all of such Subsidiary Guarantor’s respective property and assets to any other entity, provided that the following conditions are met:
(i) such Subsidiary Guarantor shall be the continuing entity, or the successor entity (if other than such Subsidiary Guarantor) formed by or resulting from any consolidation or merger or which shall have received the sale, assignment, conveyance, transfer or lease of property and assets shall be domiciled in the United States, any state thereof or the District of Columbia and shall expressly assume by supplemental indenture the payment of all amounts due under its Guarantee of the Notes and the due and punctual performance and observance of all of the covenants and conditions of such Subsidiary Guarantor in the Indenture and its Guarantee, as the case may be; provided, that the foregoing requirement will not apply in the case of a Subsidiary Guarantor (x) that has been disposed of in its entirety to another Person (other than to the Parent Guarantor or an affiliate of the Parent Guarantor), whether through a merger, consolidation or sale of capital stock or has sold, assigned, conveyed, transferred or leased all or substantially all of its assets or (y) that, as a result of the disposition of all or a portion of its capital stock, ceases to be a Subsidiary;
(ii) immediately after giving effect to the transaction, no Event of Default, and no event which, after notice or the lapse of time, or both, would become an Event of Default, shall have occurred and be continuing; and
(iii) an Officers’ Certificate and Opinion of Counsel shall have been delivered to the Trustee, each stating that such transaction and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture comply with the
17
Indenture and that all conditions precedent provided for relating to such transaction have been complied with.
(b) In the event of any transaction described in and complying with the conditions listed in this Section 6.2 in which such Subsidiary Guarantor is the continuing entity, the successor Person formed or remaining shall succeed, and be substituted for, and may exercise every right and power of such Subsidiary Guarantor and (except in the case of a lease) such Subsidiary Guarantor shall be discharged from its obligations under the Notes, its Guarantee and the Indenture.
Section 6.3 Exempted Transactions.
Sections 6.1 and 6.2 hereof shall not apply to:
(a) a merger, consolidation, sale, assignment, conveyance, transfer, lease or other disposition of assets between or among the Parent Guarantor, the Issuer or any Subsidiary Guarantor; provided, however that the foregoing clause shall not apply to any merger, consolidation, sale, assignment, conveyance, transfer, lease or other disposition of assets involving the Issuer where the Issuer is not the continuing entity or the successor entity; or
(b) a merger between the Parent Guarantor or any of its Subsidiaries, on the one hand, and an affiliate of the Parent Guarantor or such Subsidiary, on the other hand, incorporated or formed solely for the purpose of reincorporating or reorganizing the Parent Guarantor or such Subsidiary in another state of the United States.
ARTICLE VII
ADDITIONAL COVENANTS
In addition to the covenants set forth in the Base Indenture (as amended by this Third Supplemental Indenture), the following additional covenants shall apply with respect to the Notes and the Guarantee so long as any of the Notes remain Outstanding:
Section 7.1 Aggregate Debt.
The Parent Guarantor shall not, and shall not permit any of its Subsidiaries to, incur any Debt if, immediately after giving effect to the incurrence of such Debt and the application of the proceeds from such Debt on a pro forma basis, the aggregate principal amount of all of its and its Subsidiaries’ outstanding Debt (determined on a consolidated basis in accordance with GAAP) is greater than 60% of the sum of the following (without duplication):
(a) its and its Subsidiaries’ Total Assets as of the last day of the then most recently ended fiscal quarter for which financial information is available; and
(b) the aggregate purchase price of any real estate assets or mortgages receivable acquired, and the aggregate amount of any securities offering proceeds received (to the extent such proceeds were not used to acquire real estate assets or mortgages receivable or used to
18
reduce Debt), by the Parent Guarantor or any of its Subsidiaries since the end of such fiscal quarter, including the proceeds obtained from the incurrence of such additional Debt.
Section 7.2 Secured Debt.
The Parent Guarantor shall not, and shall not permit any of its Subsidiaries to, incur any Debt secured by any Lien on any of its or any of its Subsidiaries’ property or assets, whether owned on the date of the Indenture or subsequently acquired, if, immediately after giving effect to the incurrence of such Debt and the application of the proceeds from such Debt on a pro forma basis, the aggregate principal amount (determined on a consolidated basis in accordance with GAAP) of all of its and its Subsidiaries’ outstanding Debt that is secured by a Lien on any of its and its Subsidiaries’ property or assets is greater than 40% of the sum of (without duplication):
(a) its and its Subsidiaries’ Total Assets as of the last day of the then most recently ended fiscal quarter for which financial information is available; and
(b) the aggregate purchase price of any real estate assets or mortgages receivable acquired, and the aggregate amount of any securities offering proceeds received (to the extent such proceeds were not used to acquire real estate assets or mortgages receivable or used to reduce Debt), by the Parent Guarantor or any of its Subsidiaries since the end of such fiscal quarter, including the proceeds obtained from the incurrence of such additional Debt.
Section 7.3 Debt Service.
The Parent Guarantor shall not, and shall not permit any of its Subsidiaries to, incur any Debt if the ratio of Consolidated EBITDA to Annual Debt Service Charge for the period consisting of the four consecutive fiscal quarters most recently ended for which financial information is available prior to the date on which such additional Debt is to be incurred shall have been less than 1.5:1 on a pro forma basis after giving effect to the incurrence of such Debt and the application of the proceeds from such Debt (determined on a consolidated basis in accordance with GAAP), and calculated on the following assumptions:
(a) such Debt and any other Debt incurred by the Parent Guarantor or any of its Subsidiaries since the first day of such four-quarter period had been incurred, and the application of the proceeds from such Debt (including to repay or retire other Debt) had occurred, on the first day of such period;
(b) the repayment or retirement of any other Debt of the Parent Guarantor or any of its Subsidiaries since the first day of such four-quarter period had occurred on the first day of such period (except that, in making this computation, the amount of Debt under any revolving credit facility, line of credit or similar facility will be computed based upon the average daily balance of such Debt during such period);
(c) in the case of Acquired Debt or Debt incurred by the Parent Guarantor or any of its Subsidiaries in connection with any acquisition since the first day of such four-quarter period, the related acquisition had occurred as of the first day of such period with appropriate adjustments with respect to such acquisition being included in the pro forma calculation; and
19
(d) in the case of any acquisition or disposition by the Parent Guarantor or any of its Subsidiaries of any asset or group of assets with a fair market value in excess of $1.0 million since the first day of such four-quarter period, whether by merger, stock purchase or sale or asset purchase or sale or otherwise, such acquisition or disposition and any related repayment of Debt had occurred as of the first day of such period with the appropriate adjustments with respect to such acquisition or disposition being included in such pro forma calculation.
If the Debt giving rise to the need to make the calculation described above or any other Debt incurred after the first day of the relevant four-quarter period bears interest at a floating rate (to the extent such Debt has been hedged to bear interest at a fixed rate, only the portion of such Debt, if any, that has not been so hedged), then, for purposes of calculating the Annual Debt Service Charge, the interest rate on such Debt will be computed on a pro forma basis as if the average daily rate that would have been in effect during the entire four-quarter period had been the applicable rate for the entire such period. For purposes of the foregoing, Debt will be deemed to be incurred by the Parent Guarantor or any of its Subsidiaries whenever the Parent Guarantor or any of its Subsidiaries shall create, assume, guarantee or otherwise become liable in respect thereof.
Section 7.4 Maintenance of Total Unencumbered Assets.
The Parent Guarantor and its Subsidiaries shall not have at any time Total Unencumbered Assets of less than 150% of the aggregate principal amount of all of the Parent Guarantor’s and its Subsidiaries’ outstanding Unsecured Debt determined on a consolidated basis in accordance with GAAP.
Section 7.5 Subsidiary Guarantors.
Following the Issue Date of the Notes, the Parent Guarantor shall cause each of its Subsidiaries (other than the Issuer) if, and for so long as, such Subsidiary, directly or indirectly, guarantees or otherwise becomes obligated in respect of Triggering Indebtedness, to, jointly and severally with the Parent Guarantor and any other Subsidiary of the Parent Guarantor that guarantees the Notes, guarantee the Issuer’s obligations under the Notes on a full and unconditional basis, including the due and punctual payment of principal of (and premium, if any) and Interest, if any, on, the Notes, whether at Stated Maturity, upon acceleration, upon redemption or otherwise, by executing and delivering a supplemental indenture to the Indenture, substantially in the form set forth as Exhibit B hereto, that provides for the Guarantee within thirty calendar days and, pursuant to such supplemental indenture, such Subsidiary shall fully and unconditionally guarantee all of the Issuer’s obligations under the Notes on the terms and subject to the conditions set forth in the Indenture, including without limitation in Article X of this Third Supplemental Indenture (each such Subsidiary, unless and until such time such Subsidiary is released from its obligations under the Indenture and its Guarantee in accordance with the terms of the Indenture, a “Subsidiary Guarantor”).
20
ARTICLE VIII
DEFAULTS AND REMEDIES
Section 8.1 hereof shall replace Section 501 of the Base Indenture with respect to the Notes and the Guarantee.
Section 8.1 Events of Default.
“Event of Default,” wherever used herein or in the Base Indenture with respect to the Notes and the Guarantee, shall mean any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body):
(a) default in the payment of any Interest on the Notes when such Interest becomes due and payable that continues for a period of 30 days;
(b) default in the payment of any principal of (and premium, if any) on the Notes, or any Redemption Price due with respect to the Notes, when due and payable;
(c) failure by the Issuer or any Guarantor to comply with the Issuer’s or such Guarantor’s respective obligations described in Article VI hereof;
(d) default in the performance, or breach, of any of the Issuer’s or the Parent Guarantor’s other covenants or warranties in the Indenture and continuance of such default or breach for a period of 60 days after the Issuer receives written notice specifying the default (and demanding that such default be remedied) from the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then Outstanding;
(e) default under any bond, debenture, note, mortgage, indenture or instrument, other than Non-Recourse Debt, under which there may be issued or by which there may be secured or evidenced any Debt by the Issuer, the Parent Guarantor or any of their respective Significant Subsidiaries, the repayment of which the Issuer, the Parent Guarantor or any of their respective Significant Subsidiaries have guaranteed or for which the Issuer, the Parent Guarantor or any of their respective Significant Subsidiaries are directly responsible or liable as obligor or guarantor, having an aggregate principal amount in excess of $50,000,000, whether such Debt exists as of the date of the Indenture or shall thereafter be created, which default shall have resulted in such Debt becoming or being declared due and payable prior to the date on which it would otherwise have become due and payable, without such Debt having been discharged, or such acceleration having been rescinded or annulled, within the greater of (i) the period specified in such instrument and (ii) 60 days after written notice to the Issuer by the Trustee or Holders of at least 25% in aggregate principal amount of the Notes then Outstanding;
(f) the Guarantee of any Guarantor ceases to be in full force and effect (except as contemplated by the terms of the Indenture) or is declared null and void in a judicial proceeding
21
or any Guarantor denies or disaffirms its obligations under the Indenture or its Guarantee, except by reason of the release of such Guarantee in accordance with provisions of the Indenture;
(g) the Parent Guarantor, the Issuer, or any of their respective Significant Subsidiaries pursuant to or under or within meaning of any Bankruptcy Law:
(i) commences a voluntary case; or
(ii) consents to the entry of an order for relief against it in an involuntary case; or
(iii) consents to the appointment of any receiver, trustee, assignee, liquidator or other similar official under any Bankruptcy Law of it or for all or substantially of its property; or
(iv) makes a general assignment for the benefit of creditors; or
(h) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(i) is for relief against the Parent Guarantor, the Issuer or any of their respective Significant Subsidiaries in an involuntary case; or
(ii) appoints a trustee, receiver, liquidator, custodian or other similar official of the Parent Guarantor, the Issuer or any of their respective Significant Subsidiaries or for all or substantially all of its or their respective property; or
(iii) orders the liquidation of the Parent Guarantor, the Issuer or any of their respective Significant Subsidiaries;
and, in each case in this clause (h), the order or decree remains unstayed and in effect for 90 calendar days.
ARTICLE IX
AMENDMENTS AND WAIVERS
Sections 9.1 and 9.2 hereof shall replace Sections 901 and 902, respectively, of the Base Indenture with respect to the Notes and the Guarantee.
Section 9.1 Without Consent of Holders.
The Issuer and the Guarantors, when authorized by Board Resolutions of their Board of Directors, and the Trustee may, from time to time and at any time, enter into an indenture or indentures supplemental hereto without the consent of the Holders of the Notes hereto for one or more of the following purposes:
22
(a) to cure any ambiguity, defect or inconsistency in the Indenture; provided that this action shall not adversely affect the interests of the Holders of the Notes in any material respect;
(b) to evidence a successor to the Issuer as obligor or any Guarantor as guarantor under the Indenture with respect to the Notes;
(c) to make any change that does not adversely affect the interests of the Holders of any Notes then Outstanding;
(d) to provide for the issuance of additional Notes in accordance with the limitations set forth in the Indenture;
(e) to provide for the acceptance of appointment by a successor Trustee or facilitate the administration of the trusts under the Indenture by more than one Trustee;
(f) to comply with the requirements of the SEC in order to effect or maintain the qualification of the Indenture under the TIA;
(g) to reflect the release of any Guarantor in accordance with the Indenture;
(h) to secure the Notes;
(i) to add guarantors with respect to the Notes; or
(j) to conform the text of the Indenture, any Guarantee or the Notes to any provision of the description thereof set forth under the captions “Description of Notes” and “Description of Debt Securities” in the prospectus supplement and prospectus relating to the Notes.
Upon the written request of the Issuer, accompanied by Board Resolutions authorizing the execution of any supplemental indenture, the Trustee is hereby authorized to join with the Issuer and the Guarantors in the execution of any such supplemental indenture, to make any further appropriate agreements and stipulations that may be therein contained and to accept the conveyance, transfer and assignment of any property thereunder, but the Trustee shall not be obligated to, but may in its discretion, enter into any supplemental indenture that affects the Trustee’s own rights, duties or immunities under the Indenture or otherwise.
Any supplemental indenture authorized by the provisions of this Section 9.1 may be executed by the Issuer, the Guarantors and the Trustee without the consent of the Holders of any of the Notes at the time Outstanding, notwithstanding any of the provisions of Section 9.2.
Section 9.2 With Consent of Holders.
With the consent (evidenced as provided in Article 9 of the Base Indenture) of the Holders of not less than a majority in aggregate principal amount of the Outstanding Notes, the Issuer and the Guarantors, when authorized by Board Resolutions of their Board of Directors, and the Trustee may, from time to time and at any time, enter into an indenture or indentures supplemental hereto
23
for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or any supplemental indenture or modifying in any manner the rights of the Holders of the Notes; provided that no such supplemental indenture shall, without the consent of the Holder of each Outstanding Note so affected by such supplemental indenture:
(a) reduce the principal amount of the Notes whose Holders must consent to an amendment or waiver;
(b) reduce the rate of or extend the time for payment of Interest (including default Interest) on the Notes;
(c) waive a default or Event of Default in the payment of the principal of (or premium, if any) or Interest on, the Notes (except a rescission of acceleration of the Notes by the Holders of a majority in principal amount of the then Outstanding Notes and a waiver of the payment default that resulted from such acceleration);
(d) make the principal of (or premium, if any) or Interest on the Notes payable in any currency other than that stated in the Notes;
(e) make any change to Section 1001 of the Base Indenture, the second paragraph of Section 507 of the Base Indenture or this Section 9.2;
(f) waive a redemption payment with respect to the Notes; or
(g) release any Guarantor as a guarantor of the Notes other than as provided in the Indenture or modify any Guarantee in any manner adverse to the Holders.
Upon the written request of the Issuer, accompanied by Board Resolutions authorizing the execution of any supplemental indenture, and upon the filing with the Trustee of evidence of the consent of Holders of the Notes as aforesaid, the Trustee shall join with the Issuer and the Guarantors in the execution of such supplemental indenture unless such supplemental indenture affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion, but shall not be obligated to, enter into such supplemental indenture.
It shall not be necessary for the consent of the Holders of Notes under this Section 9.2 to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such consent shall approve the substance thereof.
ARTICLE X
RELEASE OF GUARANTEE
Section 10.1 hereof shall replace Section 1505 of the Base Indenture and Section 10.2 hereof shall apply with respect to the Notes and the Guarantee.
24
Section 10.1 Release of Guarantee of the Parent Guarantor.
Notwithstanding the provisions of Section 1501 of the Base Indenture, the Parent Guarantor shall be automatically and unconditionally released and relieved from its obligations under its Guarantee and the Indenture and any supplemental indenture in the following circumstances:
(a) upon the Issuer’s exercise of its legal defeasance option or if the Issuer’s obligations under the Indenture are discharged in accordance with the terms of the Indenture; or
(b) upon delivery of an Officers’ Certificate to the Trustee that the Parent Guarantor does not guarantee the obligations of the Issuer under any indebtedness for money borrowed of the Issuer and that any other guarantees of such Parent Guarantor have been released other than through discharges as a result of payment by such Parent Guarantor on such guarantees.
Section 10.2 Release of Guarantee of a Subsidiary Guarantor.
(a) A Subsidiary Guarantor shall be automatically and unconditionally released and relieved from its obligations under its Guarantee and the Indenture and any supplemental indenture in the following circumstances:
(i) if such Subsidiary Guarantor no longer guarantees or is otherwise no longer an obligor (or if such Subsidiary Guarantor’s guarantee or obligation is simultaneously released or will be immediately released after the release of the Subsidiary Guarantor from its Guarantee of the Notes) in respect of Triggering Indebtedness; provided that any release of such Subsidiary Guarantor’s Guarantee pursuant to this Section 10.2(a)(i) shall not limit the obligation of such Subsidiary Guarantor to Guarantee the Notes at any time after such release if such Subsidiary subsequently, directly or indirectly, guarantees, or otherwise becomes obligated in respect of, Triggering Indebtedness;
(ii) if such Subsidiary Guarantor consolidates with, merges into or transfers all of its properties or assets to another Guarantor, and as a result of, or in connection with, such transaction such Subsidiary Guarantor dissolves or otherwise ceases to exist;
(iii) if the Issuer exercises its legal defeasance option or its covenant defeasance option with respect to the Notes (as provided in Section 402 of the Base Indenture) or if the Issuer’s obligations under the Indenture with respect to the Notes are discharged in accordance with the terms of the Indenture (as provided in Section 401 of the Base Indenture);
(iv) upon the sale or other disposition (including by way of consolidation or merger) of such Subsidiary Guarantor; or
(v) upon the sale or disposition of all or substantially all of the assets of such Subsidiary Guarantor,
25
provided, however, that in the case of clauses (iv) and (v) above, (1) such sale or other disposition is made to a Person other than the Parent Guarantor or any of its other Subsidiaries and (2) such sale or disposition is otherwise permitted by the Indenture.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.1 Trust Indenture Act Controls.
If any provision of this Third Supplemental Indenture limits, qualifies, or conflicts with another provision which is required or deemed to be included in this Third Supplemental Indenture by the TIA, such required or deemed provision shall control.
Section 11.2 Integral Part.
This Third Supplemental Indenture constitutes an integral part of the Base Indenture.
Section 11.3 Governing Law.
THIS THIRD SUPPLEMENTAL INDENTURE, THE NOTES AND ANY GUARANTEE, INCLUDING ANY CLAIM OR CONTROVERSY ARISING OUT OF OR RELATING TO THE BASE INDENTURE, THIS THIRD SUPPLEMENTAL INDENTURE, THE NOTES AND ANY GUARANTEE, SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
Section 11.4 Counterparts.
This Third Supplemental Indenture may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. The exchange of copies of this Third Supplemental Indenture and of signature pages by electronic transmission shall constitute effective execution and delivery of this Third Supplemental Indenture as to the parties hereto and may be used in lieu of the original Third Supplemental Indenture for all purposes. The words “execution,” “signed,” “signature,” and words of like import in this Third Supplemental Indenture shall include images of manually executed signatures transmitted by facsimile, email or other electronic format (including, without limitation, “pdf,” “tif” or “jpg”) and other electronic signatures (including without limitation, DocuSign and AdobeSign). The use of electronic signatures and electronic records (including, without limitation, any contract or other record created, generated, sent, communicated, received, or stored by electronic means) shall be of the same legal effect, validity and enforceability as a manually executed signature or use of a paper-based record-keeping system to the fullest extent permitted by applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act and any other applicable law, including, without limitation, any state law based on the Uniform Electronic Transactions Act or the Uniform Commercial Code. Without limitation to the foregoing, and anything in this Third Supplemental Indenture to the
26
contrary notwithstanding, (a) any Officers’ Certificate, Issuer Order, Opinion of Counsel, Note, Guarantee, instrument, agreement or other document delivered pursuant to this Third Supplemental Indenture may be executed, attested and transmitted by any of the foregoing electronic means and formats, (b) all references in Section 303 of the Base Indenture or elsewhere in the Indenture to the execution, attestation or authentication of any Note, any Guarantee or any certificate of authentication appearing on or attached to any Note by means of a manual or facsimile signature shall be deemed to include signatures that are made or transmitted by any of the foregoing electronic means or formats, and (c) any requirement in the Indenture that any signature be made under a corporate seal (or facsimile thereof) shall not be applicable to the Notes or any Guarantee. The Issuer agrees to assume all risks arising out of the use of using digital signatures, including without limitation the risk of the Trustee acting on unauthorized instructions.
Section 11.5 Successors and Assigns.
All agreements of the Issuer and each Guarantor in this Third Supplemental Indenture and the Notes shall bind their respective successors and assigns, whether so expressed or not.
All agreements of the Trustee in this Third Supplemental Indenture shall bind its successors and assigns, whether so expressed or not.
Section 11.6 Severability.
In case any provision in this Third Supplemental Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
Section 11.7 Table of Contents, Headings, Etc.
The Table of Contents and headings of the Articles and Sections of this Third Supplemental Indenture have been inserted for convenience of reference only, are not to be considered a part hereof, and shall in no way modify or restrict any of the terms or provisions hereof.
Section 11.8 Ratifications.
The Base Indenture, as supplemented and amended by this Third Supplemental Indenture, is in all respects ratified and confirmed. The Indenture shall be read, taken and construed as one and the same instrument. All provisions included in this Third Supplemental Indenture with respect to the Notes and the Guarantee supersede any conflicting provisions included in the Base Indenture unless not permitted by law..
Section 11.9 Effectiveness.
The provisions of this Third Supplemental Indenture shall become effective as of the date hereof.
27
Section 11.10 The Trustee.
The Trustee accepts the trusts created by the Indenture, and agrees to perform the same upon the terms and conditions of the Indenture. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Third Supplemental Indenture or the due execution thereof by the Issuer and the Parent Guarantor. The recitals contained herein shall be taken as the statements solely of the Issuer and the Parent Guarantor, and the Trustee assumes no responsibility for the correctness thereof. If and when the Trustee shall be or become a creditor of the Issuer or the Parent Guarantor (or any other obligor upon the Notes), excluding any creditor relationship listed in TIA Section 311(b), the Trustee shall be subject to the provisions of the TIA regarding the collection of the claims against the Issuer or the Parent Guarantor (or any such other obligor). If the Trustee has or shall acquire a conflicting interest within the meaning of the TIA, the Trustee shall either eliminate such interest or resign, to the extent and in the manner provided by, and subject to the provisions of, the TIA and the Indenture.
[Signature pages follow]
28
IN WITNESS WHEREOF, the parties hereto have caused this Third Supplemental Indenture to be duly executed by their respective officers hereunto duly authorized, all as of the day and year first written above.
| COUSINS PROPERTIES LP, as the Issuer | |||||||||||||||||
| By: Cousins Properties Incorporated, its sole general partner | |||||||||||||||||
| By: | /s/ Gregg Adzema | ||||||||||||||||
| Name: Gregg D. Adzema | |||||||||||||||||
Title: Executive Vice President and Chief Financial Officer | |||||||||||||||||
| COUSINS PROPERTIES INCORPORATED, as Parent Guarantor | |||||||||||||||||
| By: | /s/ Gregg Adzema | ||||||||||||||||
| Name: Gregg D. Adzema | |||||||||||||||||
Title: Executive Vice President and Chief Financial Officer | |||||||||||||||||
| By: | /s/ Pamela F. Roper | ||||||||||||||||
| Name: Pamela F. Roper | |||||||||||||||||
Title: Executive Vice President, General Counsel and Corporate Secretary | |||||||||||||||||
| U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION, as Trustee | |||||||||||||||||
| By: | /s/ Gregory M. Jackson | ||||||||||||||||
| Name: Gregory M. Jackson | |||||||||||||||||
| Title: | Vice President | ||||||||||||||||
EXHIBIT A
COUSINS PROPERTIES LP
THIS SECURITY IS A GLOBAL NOTE WITHIN THE MEANING SET FORTH IN THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND, UNLESS AND UNTIL IT IS EXCHANGED FOR SECURITIES IN DEFINITIVE FORM AS AFORESAID, MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ITS NOMINEE TO A SUCCESSOR DEPOSITARY OR ITS NOMINEE.
A-1
[FACE OF NOTE]
COUSINS PROPERTIES LP
5.250% SENIOR NOTES DUE 2030
Certificate No. [ ]
CUSIP No.: 222793 AC5
ISIN: US222793AC56
$[ ]
Cousins Properties LP, a Delaware limited partnership (herein called the “Issuer,” which term includes any successor under the Indenture referred to on the reverse hereof), for value received hereby promises to pay to Cede & Co., or its registered assigns, the principal sum of [ ] MILLION DOLLARS ($[ ])[, or such lesser amount as is set forth in the Schedule of Exchanges of Interests in the Global Note on the other side of this Note,] on July 15, 2030 at the office or agency of the Issuer maintained for that purpose in accordance with the terms of the Indenture, in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts, and to pay Interest semi-annually in arrears on January 15 and July 15 of each year, commencing on January 15, 2026 to the Holder in whose name the Note is registered in the Security Register on the preceding January 1 or July 1, whether or not a Business Day, as the case may be, in accordance with the terms of the Indenture. Interest on the Notes will be computed on the basis of a 360-day year consisting of twelve 30-day months. Each installment of Interest on any Certificated Note may at the Issuer’s option be paid by (1) mailing a check for such Interest payable to or upon the written order of the Person entitled thereto, to the address of such Person as it appears on the Security Register or (2) wire transfer to an account maintained by the payee located inside the United States. This Note shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed manually by the Trustee or a duly authorized authenticating agent under the Indenture.
A-2
IN WITNESS WHEREOF, the Issuer has caused this Note to be duly executed.
COUSINS PROPERTIES LP | ||||||||
By: | Cousins Properties Incorporated, its general partner | |||||||
By: | ||||||||
Name: | ||||||||
Title: | ||||||||
A-3
TRUSTEE’S CERTIFICATE OF AUTHENTICATION
This is one of the Notes described in the within-named Indenture.
Dated:
| U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION, as Trustee | ||||||||
By: | ||||||||
Authorized Signatory | ||||||||
A-4
[FORM OF REVERSE SIDE OF NOTE]
COUSINS PROPERTIES LP
5.250% SENIOR NOTES DUE 2030
This Note is one of a duly authorized issue of Securities of the Issuer, designated as its 5.250% Senior Notes due 2030 (herein called the “Notes”), issued under and pursuant to an Indenture, dated as of May 8, 2024 (herein called the “Base Indenture”), among the Issuer, Cousins Properties Incorporated (the “Parent Guarantor”) and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”), as supplemented by the Third Supplemental Indenture, dated as of June 6, 2025 (the “Third Supplemental Indenture,” and together with the Base Indenture, the “Indenture”), to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Issuer, the Parent Guarantor and the Holders of the Notes. Capitalized terms used but not otherwise defined in this Note shall have the respective meanings ascribed thereto in the Indenture.
If an Event of Default with respect to the Notes at the time Outstanding occurs and is continuing (other than an Event of Default specified in Sections 8.1(g) and 8.1(h) of the Third Supplemental Indenture), then, unless the principal of all of the Notes shall have already become due and payable, the Trustee or the Holders of not less than 25% in aggregate principal amount of the Outstanding Notes may declare the principal amount of (and premium, if any) and accrued and unpaid Interest, if any, on all of the Outstanding Notes to be due and payable immediately, by a notice in writing to the Issuer (and to the Trustee if given by Holders), and upon any such declaration such principal amount (or specified amount) and accrued and unpaid Interest, if any, shall become immediately due and payable. If an Event of Default specified in Sections 8.1(g) or 8.1(h) of the Third Supplemental Indenture shall occur, the principal amount (or specified amount) of (and premium, if any) and accrued and unpaid Interest, if any, on all Outstanding Notes shall automatically become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder.
The Indenture contains provisions permitting the Issuer, the Guarantors and the Trustee, with the consent of the Holders of a majority in aggregate principal amount of the Notes at the time Outstanding, to execute supplemental indentures adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or modifying in any manner the rights of the Holders of the Notes, subject to exceptions set forth in Section 9.2 of the Third Supplemental Indenture. Subject to the provisions of the Indenture, the Holders of a majority in aggregate principal amount of the Notes at the time Outstanding may, on behalf of the Holders of all of the Notes, waive any past default or Event of Default, subject to exceptions set forth in the Indenture.
No reference herein to the Indenture and no provision of this Note or of the Indenture shall impair, as among the Issuer and the Holder of the Notes, the obligation of the Issuer, which is absolute and unconditional, to pay the principal of (and premium, if any) and Interest on this Note
A-5
at the place, at the respective times, at the rate and in the coin or currency prescribed herein and in the Indenture.
Interest on the Notes shall be computed on the basis of a 360-day year consisting of twelve 30-day months.
The Notes are issuable in fully registered form, without coupons, in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof.
The Issuer shall have the right to redeem the Notes under certain circumstances as set forth in Article 11 of the Base Indenture, as amended by the provisions of Article III of the Third Supplemental Indenture.
The Notes are not subject to redemption through the operation of any sinking fund.
The obligations of each Guarantor to the Holders of the Notes and to the Trustee pursuant to its Guarantee and the Indenture are expressly set forth in Article 15 of the Base Indenture and Article X of the Third Supplemental Indenture and reference is hereby made to such provisions for the precise terms of the Guarantee.
No director, officer, employee, incorporator, controlling person, stockholder, general partner, limited partner, member or agent of the Issuer or any Guarantor, as such, or of any of the Issuer’s or any Guarantor’s predecessors or successors, shall have any liability for any of the Issuer’s obligations under the Notes, the Indenture, any Guarantees or for any claim based on, in respect of, or by reason of, such obligations or their creation. The Holder of this Note, by accepting this Note, waives and releases all such liability. The waiver and release are part of the consideration for issuance of this Note. The waiver may not be effective to waive liabilities under the federal securities laws.
This Note shall be governed by, and construed in accordance with, the laws of the State of New York.
A-6
GUARANTEE
Cousins Properties Incorporated, a Georgia Corporation (hereinafter referred to as the “Guarantor,” which term includes any successor under the Indenture, referred to below), hereby irrevocably and unconditionally guarantees on a senior basis on the terms set forth in the Indenture the Guarantee Obligations, which include (i) the due and punctual payment of the principal of (including the Redemption Price upon redemption pursuant to the Indenture) and Interest on the 5.250% Senior Notes due 2030 (the “Notes”) of Cousins Properties LP, a Delaware limited partnership (the “Issuer,” which term includes any successor thereto under the Indenture), whether at the Maturity Date, upon acceleration, upon redemption or otherwise, the due and punctual payment of Interest on any overdue principal and (to the extent permitted by law) Interest on any overdue Interest on the Notes, and the due and punctual performance of all other obligations of the Issuer, to the Holders of the Notes or the Trustee all in accordance with the terms set forth in Article 15 of the Base Indenture and Article X of the Third Supplemental Indenture, and (ii) in case of any extension of time of payment or renewal of any Notes or any such other obligations, that the same shall be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at the Maturity Date, upon acceleration, upon redemption or otherwise.
This Guarantee has been issued under and pursuant to an Indenture, dated as of May 8, 2024 (the “Base Indenture”), as supplemented by the Third Supplemental Indenture (the “Third Supplemental Indenture”), dated as of June 6, 2025 (the Base Indenture, as supplemented by the Third Supplemental Indenture, and as it may be further amended or supplemented from time to time, the “Indenture”), among the Issuer, the Guarantor and U.S. Bank Trust Company, National Association, as Trustee (herein called the “Trustee,” which term includes any successor thereto under the Indenture). Terms (whether or not capitalized) that are defined in the Indenture and used but not otherwise defined in this Guarantee shall have the respective meanings ascribed thereto in the Indenture.
The Guarantee Obligations of the Guarantor to the Holders of the Notes and to the Trustee pursuant to this Guarantee and the Indenture are expressly set forth in Article 15 of the Base Indenture and Article X of the Third Supplemental Indenture and reference is hereby made to such Indenture for the precise terms of this Guarantee.
The Guarantor hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of merger or bankruptcy of the Issuer, any right to require a proceeding first against the Issuer, the benefit of discussion, protest or notice with respect to the Notes and all demands whatsoever.
No director, officer, employee, incorporator, controlling person, stockholder, general partner, limited partner, member or agent of the Issuer or any Guarantor, as such, or of any of the Issuer’s or any Guarantor’s predecessors or successors, shall have any liability for the Guarantor under this Guarantee or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. This is a continuing Guarantee and shall remain in full force and effect and shall be binding upon the Guarantor and its successors and assigns until full and final payment of all of the Issuer’s obligations under
the Notes and the Indenture or until legally discharged in accordance with the Indenture and shall inure to the benefit of the successors and assigns of the Trustee and the Holders of the Notes, and, in the event of any transfer or assignment of rights by any Holder of the Notes or the Trustee, the rights and privileges herein conferred upon that party shall automatically extend to and be vested in such transferee or assignee, all subject to the terms and conditions hereof. This is a Guarantee of payment and performance and not of collection.
This Guarantee shall not be valid or obligatory for any purpose until the certificate of authentication on the Note upon which this Guarantee is endorsed shall have been executed by the Trustee or a duly authorized authenticating agent under the Indenture by the manual signature of one of its authorized officers.
The Guarantee Obligations of the Guarantor under this Guarantee shall be limited as provided in Article 15 of the Base Indenture to the extent necessary to ensure that it does not constitute a fraudulent conveyance under applicable law.
THE TERMS OF ARTICLE 15 OF THE BASE INDENTURE AND ARTICLE X OF THE THIRD SUPPLEMENTAL INDENTURE ARE INCORPORATED HEREIN BY REFERENCE.
This Guarantee shall be governed by, and construed in accordance with, the laws of the State of New York.
IN WITNESS WHEREOF, the Guarantor has caused this instrument to be duly executed.
| Dated: | COUSINS PROPERTIES INCORPORATED | ||||||||||
By: | |||||||||||
Name: | |||||||||||
Title: | |||||||||||
By: | |||||||||||
Name: | |||||||||||
Title: | |||||||||||
[Signature Page to Guarantee]
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to:
______________________________________________________________________________
(Insert assignee’s legal name)
______________________________________________________________________________
(Insert assignee’s soc. sec. or tax I.D. no.)
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Print or type assignee’s name, address and zip code)
and irrevocably appoint _________________________________________________________ to transfer this Note on the books of the Issuer. The agent may substitute another to act for him.
Date: ________________________
Your Signature: ___________________________________________________________
(Sign exactly as your name appears on the face of this Note)
Signature Guarantee*: ___________________________________________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee).
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE *
The following exchanges of a part of this Global Note for an interest in another Global Note or for a Certificated Note, or exchanges of a part of another Global Note or Certificated Note for an interest in this Global Note, have been made:
| Date of Exchange | Amount of decrease in principal amount at maturity of this Global Note | Amount of increase in principal amount at maturity of this Global Note | Principal amount at maturity of this Global Note following such decrease(or increase) | Signature of authorized officer of Trustee or Custodian | ||||||||||||||||||||||||||||||||||
* This Schedule should be included only if the Note is issued in global form.
EXHIBIT B
[FORM OF SUPPLEMENTAL INDENTURE TO BE ENTERED INTO BY SUBSIDIARY GUARANTORS]
SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of ________, 20__, among ___________ (the “Guaranteeing Subsidiary”), Cousins Properties LP, a Delaware limited partnership (the “Issuer”), Cousins Properties Incorporated, a Georgia corporation (the “Parent Guarantor”), and U.S. Bank Trust Company, National Association, as trustee under the Indenture referred to below (the “Trustee”).
WITNESSETH:
WHEREAS, the Issuer, the Parent Guarantor and the Trustee have heretofore entered into an Indenture, dated as of May 8, 2024 (the “Base Indenture”), providing for the issuance from time to time of Securities in one or more series;
WHEREAS, the Issuer, the Parent Guarantor and the Trustee have heretofore entered into a Third Supplemental Indenture, dated as of June 6, 2025 (the “Third Supplemental Indenture” and, together with the Base Indenture, the “Indenture”), amending and supplementing the Base Indenture and establishing a series of Securities designated as the Issuer’s “5.250% Senior Notes due 2030” (the “Notes”);
WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Guaranteeing Subsidiary shall fully and unconditionally guarantee all of the Issuer’s obligations under the Notes on the terms and subject to the conditions set forth in the Indenture, including without limitation in Article X of the Third Supplemental Indenture; and
WHEREAS, pursuant to Section 9.1 of the Third Supplemental Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture,
NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Issuer, the Parent Guarantor, the Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of Notes as follows:
ARTICLE I
RELATION TO INDENTURE; DEFINITIONS
Section 1.1 Relation to Indenture.
With respect to the Notes, this Supplemental Indenture constitutes an integral part of the Indenture.
B-1
Section 1.2 Definitions.
For all purposes of this Supplemental Indenture, capitalized terms used herein and not otherwise defined herein shall have the meanings assigned thereto in the Indenture.
Section 1.3 General References.
Unless otherwise specified or unless the context otherwise requires, (1) all references in this Supplemental Indenture to Articles and Sections refer to the corresponding Articles and Sections of this Supplemental Indenture and (2) the terms “herein,” “hereof,” “hereunder” and any other word of similar import refer to this Supplemental Indenture.
ARTICLE II
SUBSIDIARY GUARANTEE
Section 2.1 Agreement to Guarantee.
The Guaranteeing Subsidiary hereby fully and unconditionally guarantees all of the Issuer’s obligations under the Notes on the terms and subject to the conditions set forth in the Indenture, including without limitation in Article X of the Third Supplemental Indenture.
ARTICLE III
MISCELLANEOUS
Section 3.1 Certain Trustee Matters.
The recitals contained herein shall be taken as the statements of the Issuer, the Parent Guarantor and the Guaranteeing Subsidiary, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Supplemental Indenture, the Notes or any Guarantee or the proper authorization or the due execution hereof or thereof by the Issuer, the Parent Guarantor and the Guaranteeing Subsidiary. Except as expressly set forth herein, nothing in this Supplemental Indenture shall alter the duties, rights or obligations of the Trustee set forth in the Indenture.
Section 3.2 Continued Effect.
Except as expressly supplemented and amended by this Supplemental Indenture, the Indenture shall continue in full force and effect in accordance with the provisions thereof, and the Indenture, as heretofore amended and supplemented, is in all respects hereby ratified and confirmed. This Supplemental Indenture and all its provisions shall be deemed a part of the Indenture, in the manner and to the extent herein and therein provided.
Section 3.3 Governing Law.
THIS SUPPLEMENTAL INDENTURE, INCLUDING ANY CLAIM OR CONTROVERSY ARISING OUT OF OR RELATING TO THE INDENTURE, THE NOTES
B-2
OR ANY GUARANTEE, SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF.
Section 3.4 Counterparts.
This Supplemental Indenture may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. The exchange of copies of this Supplemental Indenture and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this Supplemental Indenture as to the parties hereto and may be used in lieu of the original Supplemental Indenture for all purposes. The words “execution,” “signed,” “signature,” and words of like import in this Supplemental Indenture shall include images of manually executed signatures transmitted by facsimile, email or other electronic format (including, without limitation, “pdf,” “tif” or “jpg”) and other electronic signatures (including without limitation, DocuSign and AdobeSign). The use of electronic signatures and electronic records (including, without limitation, any contract or other record created, generated, sent, communicated, received, or stored by electronic means) shall be of the same legal effect, validity and enforceability as a manually executed signature or use of a paper-based record-keeping system to the fullest extent permitted by applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act and any other applicable law, including, without limitation, any state law based on the Uniform Electronic Transactions Act or the Uniform Commercial Code.
Section 3.5 Effect of Headings.
The Article and Section headings in this Supplemental Indenture are for convenience only and shall not affect the construction hereof.
[Signature Pages Follow]
B-3
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed by their respective officers hereunto duly authorized, all as of the day and year first written above.
[NAME OF GUARANTEEING SUBSIDIARY] | |||||||||||
By: | |||||||||||
Name: | |||||||||||
Title: | |||||||||||
COUSINS PROPERTIES LP, as Issuer | |||||||||||
By: Cousins Properties Incorporated, its sole general partner | |||||||||||
By: | |||||||||||
Name: | |||||||||||
Title: | |||||||||||
| COUSINS PROPERTIES INCORPORATED, as Parent Guarantor | |||||||||||
By: | |||||||||||
Name: | |||||||||||
Title: | |||||||||||
U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION, as Trustee | |||||||||||
By: | |||||||||||
Name: | |||||||||||
Title: | |||||||||||
B-4
Exhibit 5.1
 | King & Spalding LLP 1180 Peachtree Street N.E. Ste. 1600 Atlanta, GA 30309-3521 Tel: +1 404 572 4600 Fax: +1 404 572 5100 www.kslaw.com | ||||
June 6, 2025
Cousins Properties Incorporated
Cousins Properties LP
3344 Peachtree Road NE, Suite 1800
Atlanta, Georgia 30326-4802
Ladies and Gentlemen:
We have acted as counsel to Cousins Properties Incorporated, a Georgia corporation (the “Guarantor”), and Cousins Properties LP, a Delaware limited partnership (the “Operating Partnership”), in connection with the offering by the Operating Partnership of $500,000,000 aggregate principal amount of 5.250% Senior Notes due 2030 (the “Notes”) and the guarantee thereof (the “Guarantee”) by the Guarantor. The Notes will be issued pursuant to a Registration Statement on Form S-3 (the “Registration Statement”) filed with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “Act”), the related prospectus dated May 8, 2024, and a prospectus supplement relating to the Notes, dated May 28, 2025 (the “Prospectus Supplement”), filed with the Commission pursuant to Rule 424(b) of the rules and regulations promulgated under the Act. This opinion is being provided at your request for incorporation by reference into the Registration Statement.
In connection with this opinion, we have reviewed such matters of law and examined original, certified, conformed or photographic copies of such other documents, records, agreements and certificates as we have deemed necessary as a basis for the opinions hereinafter expressed. In such review, we have assumed the genuineness of signatures on all documents submitted to us as originals and the conformity to original documents of all documents submitted to us as certified, conformed or photographic copies. We have relied, as to the matters set forth therein, on certificates of public officials. As to certain matters of fact material to this opinion, we have relied, without independent verification, upon certificates of the Operating Partnership and the Guarantor, and of certain officers of the Operating Partnership and the Guarantor.
We have assumed that the execution and delivery of, and the performance of all obligations under, the Indenture dated as of May 8, 2024, as supplemented by the Third Supplemental Indenture dated as of June 6, 2025 (collectively, the “Indenture”), among the Operating Partnership, the Guarantor and U.S. Bank Trust Company, National Association, as the trustee (the “Trustee”), has been duly authorized by all requisite action by the Trustee, and that the Indenture was duly executed and delivered by, and is a valid and binding agreement of, the Trustee, enforceable against the Trustee in accordance with its terms.
Cousins Properties Incorporated
Cousins Properties LP
June 6, 2025
Page 2
Based upon and subject to the foregoing, and subject to the assumptions, qualifications and limitations set forth herein, we are of the opinion that, upon the issuance and sale thereof as described in the Prospectus Supplement, and when executed by the Operating Partnership and the Guarantor and duly authenticated by the Trustee in accordance with the terms of the Indenture, the Notes and the Guarantee, respectively, will be valid and binding obligations of the Operating Partnership and the Guarantor enforceable against the Operating Partnership and the Guarantor in accordance with their terms.
The opinion set forth above is subject, as the enforcement of remedies, to bankruptcy, insolvency, reorganization, preference, receivership, moratorium, fraudulent conveyance or similar laws relating to or affecting the enforcement of creditors’ rights generally and to the effect of general principles of equity, whether considered in a proceeding in equity or at law (including the possible unavailability of specific performance or injunctive relief), concepts of materiality, reasonableness, good faith and fair dealing, and the discretion of the court before which a proceeding is brought.
This opinion is limited in all respects to the laws of the States of Georgia and New York and the Delaware Revised Uniform Limited Partnership Act, and no opinion is expressed with respect to the laws of any other jurisdiction or any effect that such laws may have on the opinions expressed herein. This opinion is limited to the matters stated herein, and no opinion is implied or may be inferred beyond the matters expressly stated herein.
This opinion is given as of the date hereof, and we assume no obligation to advise you after the date hereof of facts or circumstances that come to our attention or changes in law that occur which could affect the opinions contained herein. This opinion is being rendered for the benefit of the Operating Partnership and the Guarantor in connection with the matters addressed herein.
We consent to the filing of this opinion with the Commission as Exhibit 5.1 to a Current Report on Form 8-K that you will file on the date hereof to be incorporated by reference into the Registration Statement. We also consent to the reference to this firm as having passed on the validity of the Notes and the Guarantee under the caption “Legal matters” in the Prospectus Supplement.
| Very truly yours, | |||||
| /s/ King & Spalding LLP | |||||
Exhibit 8.1
 | King & Spalding LLP | ||||
| 1180 Peachtree Street N.E. | |||||
| Atlanta, GA 30309-3521 | |||||
| Tel: +1 404 572 4600 | |||||
| Fax: +1 404 572 5100 | |||||
| www.kslaw.com | |||||
June 6, 2025
Cousins Properties Incorporated
Cousins Properties LP
3344 Peachtree Road NE, Suite 1800
Atlanta, Georgia 30326-4802
Ladies and Gentlemen:
We have acted as United States federal income tax counsel for Cousins Properties Incorporated, a Georgia corporation (the “Guarantor”), and Cousins Properties LP, a Delaware limited partnership (the “Operating Partnership”), in connection with the offering by the Operating Partnership of $500,000,000 aggregate principal amount of 5.250% Senior Notes due 2030 (the “Notes”) and the guarantee thereof (the “Guarantee”) by the Guarantor. The Notes will be issued pursuant to a Registration Statement on Form S-3 (the “Registration Statement”) filed with the Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “Act”), the related prospectus dated May 8, 2024, and a prospectus supplement relating to the Notes, dated May 28, 2025 (the “Prospectus Supplement”), filed with the Commission pursuant to Rule 424(b) of the rules and regulations promulgated under the Act. This opinion is being rendered at the request of the Guarantor and the Operating Partnership and relates to certain U.S. federal income tax matters.
In connection with this opinion, we have examined and relied upon such records, documents, certificates and other instruments as in our judgment are necessary or appropriate to form the basis for the opinions hereinafter set forth. In all such examinations, we have assumed the genuineness of signatures on original documents and the conformity to such original documents of all copies submitted to us as certified, conformed or photographic copies, and as to certificates of public officials, we have assumed the same to have been properly given and to be accurate. As to matters of fact material to this opinion, we have relied upon statements and representations of representatives of the Operating Partnership and the Guarantor.
Based upon the foregoing and subject to the other limitations and qualifications set forth herein, we are of the opinion that, the discussion set forth in the Registration Statement and the Prospectus Supplement, under the captions “Certain Federal Income Tax Considerations” and
Cousins Properties Incorporated
Cousins Properties LP
June 6, 2025
Page 2 of 3
“Certain Material U.S. Federal Income Tax Considerations,” respectively, insofar as such discussion purports to summarize matters of U.S. federal income tax law and regulations or legal conclusions with respect thereto, constitutes an accurate summary of the matters set forth therein in all material respects, subject to the limitations and qualifications stated in such discussion.
The opinion expressed herein is based upon the current provisions of the Internal Revenue Code of 1986, as amended (the “Code”), the U.S. Treasury regulations promulgated thereunder, current administrative positions of the U.S. Internal Revenue Service (the “IRS”), and existing judicial decisions, any of which could be changed at any time, possibly on a retroactive basis. Any such changes could adversely affect the opinion rendered herein and the tax consequences to the Guarantor, the Operating Partnership, and the investors in the securities thereof. In addition, as noted above, our opinion is based solely on the documents that we have examined and the representations that have been made to us, and cannot be relied upon if any of the facts contained in such documents is, or later becomes, inaccurate or if any of the representations made to us is, or later becomes, inaccurate. We are not aware, however, of any facts or circumstances contrary to or inconsistent with the information, assumptions, and representations upon which we have relied for purposes of this opinion. Our opinion is not binding on the IRS or any court. Accordingly, no complete assurance can be given that the IRS will not challenge our opinion or that a court will not agree with the IRS.
This opinion is given as of the date hereof, and we assume no obligation to advise you after the date hereof of facts or circumstances that come to our attention or changes in law that occur which could affect this opinion.
We hereby consent to the filing of this opinion as Exhibit 8.1 to a Current Report on Form 8-K that you will file on the date hereof to be incorporated by reference into the Registration Statement. In giving this consent, we do not admit that we come within the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the SEC thereunder, nor do we thereby admit that we are experts with respect to any part of the Registration Statement within the meaning of the term “experts” as used in the Act or the rules and regulations of the SEC promulgated thereunder.
| Very truly yours, | |||||
| /s/ King & Spalding LLP | |||||
Exhibit 8.2
 | Deloitte Tax LLP 1230 Peachtree Street NE Suite 3100 Atlanta, GA 30309 USA Tel: +1 404 220 1500 Fax: +1 404 631 8995 www.deloitte.com | ||||
June 6, 2025
Cousins Properties Incorporated
Cousins Properties LP
3344 Peachtree Road NE
Suite 1800
Atlanta, GA 30326-4802
Re: Federal Income Tax Status of Cousins Properties Incorporated
Ladies and Gentlemen:
On May 8, 2024, Cousins Properties Incorporated (the “Company”) and Cousins Properties LP (the “Operating Partnership”) filed a Registration Statement on Form S-3 (Registration No. 333-279209) (together with all exhibits, supplements and amendments thereto, the “Registration Statement”) with the Securities and Exchange Commission (the “Commission”) registering the offer and sale, from time to time, of an indeterminate amount of common stock, warrants, preferred stock, and depository shares of the Company and debt securities of the Operating Partnership guaranteed by the Company as more fully described in the Prospectus included in the Registration Statement. The Operating Partnership filed a Prospectus Supplement (the “Supplement”), dated May 28, 2025, relating to the offer and sale of $500,000,000 aggregate principal amount of 5.250% Senior Notes due July 15, 2030, to be sold by the Operating Partnership and guaranteed by the Company. The Company and Operating Partnership have requested Deloitte Tax to issue an opinion regarding the status, for federal income tax purposes, of the Company and the Operating Partnership. The Company intends to continue to be taxed as a real estate investment trust (“REIT”) as defined in Internal Revenue Code of 1986, as amended (“IRC”), §§856-860.
As discussed below under the section entitled “LIMITATIONS ON OPINION,” you understand and agree that this opinion is solely for the Company’s information and benefit, is limited to the described transaction, and may not be relied upon by any other person or entity, other than the Company, without the prior written consent of Deloitte Tax or as otherwise described herein. Notwithstanding the above, Deloitte Tax will consent to the use of this tax opinion as an exhibit, in its entirety, to a Current Report on Form 8-K, which will be filed with the Securities and Exchange Commission.
June 6, 2025
Page 2
It is our understanding that the Company intends to use the net proceeds from the sale of any of the securities under the Supplement to repay the outstanding principal amount of the senior notes due 2025 and the remainder to repay borrowings under the credit facility and for general corporate purposes.
In rendering our opinion, we have examined and, with your consent, have relied upon the following documents:
1. Restated and Amended Articles of Incorporation of Cousins Properties Incorporated as amended August 9, 1999, and as further amended July 22, 2003, and as further amended December 15, 2004, and as further amended May 4, 2010, and as further amended May 9, 2014, and as further twice amended on October 6, 2016, and as further twice amended on June 14, 2019 (the “Articles of Incorporation”);
2. Bylaws of Cousins Properties Incorporated, as amended April 29, 1993, as further amended August 14, 2007, as further amended February 17, 2009, as further amended June 6, 2009, and as further amended December 4, 2012, as further amended on July 26, 2022, and as further amended on July 25, 2023 (the “By-Laws”);
3. Registration Statement and Supplement;
4. A letter dated June 6, 2025 and signed by Jeff Symes as Senior Vice President – Chief Accounting Officer of the Company, on behalf of the Company, a copy of which is attached hereto (the “Certificate of Representations”); and
5. Such other records, certificates, agreements, schedules and documents as we have deemed necessary or appropriate for purposes of rendering the opinion set forth herein.
In our examination of the foregoing documents, we have assumed, with your consent, that (i) the documents are original documents, or true and accurate copies of original documents, and have not been subsequently amended; (ii) the signatures on each original document are genuine; (iii) where any such document required execution by a person, the person who executed the document had proper authority and capacity; (iv) all representations and statements set forth in such documents are true and correct; (v) where any such document imposes obligations on a person, such obligations have been or will be performed or satisfied in accordance with their terms; and (vi) the Company at all times has been and will be organized and operated in accordance with the terms of such documents.
I. Background, Facts and Representations, and Significant Assumptions
A. Background
Cousins Properties Incorporated is a Georgia corporation, which since 1987 has elected to be taxed as a REIT. The Company conducts substantially all of its business through the Operating Partnership, a Delaware limited partnership. The Company owns approximately 99% of the Operating Partnership, which is consolidated with the Company for financial reporting purposes.
June 6, 2025
Page 3
The Operating Partnership also owns Cousins TRS Services, LLC (“Services”), a taxable entity, which is consolidated with the Company for financial reporting purposes, which owns and manages its own real estate portfolio and performs certain real estate related services for other parties.
The Company is an Atlanta, Georgia-based, fully integrated, self-administered equity REIT. The Company has extensive experience in the real estate industry, including the acquisition, financing, development, management and leasing of properties. The Company has been a public company since 1962, and its common stock trades on the New York Stock Exchange under the symbol "CUZ." The Company’s strategy is to create value for its stockholders through ownership of the premier urban office portfolio in the Sunbelt markets of the United States, with a particular focus on Georgia, Texas, North Carolina, Florida, and Arizona. This strategy is based on a disciplined approach to capital allocation that includes value-add acquisitions, selective development projects, and timely dispositions of non-core assets. This strategy is also based on a simple, flexible, and low-leveraged balance sheet that allows the Company to pursue investment opportunities at the most advantageous points in the cycle. To implement this strategy, the Company leverages its strong local operating platforms within each of its major markets.
B. Facts and Representations
In addition to the foregoing, our opinion is based on the factual information and assumptions contained herein and representations made to us in the Certificate of Representations attached as Attachment A, without regard to any qualification as to knowledge, belief or expectation.
Without limiting the foregoing, we have assumed that all statements and descriptions of the Company’s past and intended future activities herein and in the Certificate of Representations are true and accurate. No facts have come to our attention, however, that would cause us to question the accuracy or completeness of such facts, assumptions or documents in a material way. To the extent the representations set forth in the Certificate of Representations are with respect to matters set forth in the IRC or Treasury Regulations (the “Regulations”), we have reviewed with the Company the relevant provisions of the IRC, the applicable Regulations and published administrative interpretations thereof.
C. Significant Assumptions
Our opinion is expressly based upon any assumption set forth herein and as follows:
1. Beginning with the Company’s REIT election for the taxable year beginning January 1, 1987 and ending with the Company’s taxable year ended December 31, 2015, the Company met the requirements for qualification as a REIT and was taxed as such.
2. Each Subsidiary Partnership was properly classified as a partnership for federal income tax purposes at all times prior to January 1, 2016.
June 6, 2025
Page 4
3. The facts and representations as made by Jeff Symes on behalf of the Company in the Certificate of Representations are true and correct.
4. The Company intends to continue to be organized and operate in a manner which will allow it to meet the requirements for qualification and taxation as a REIT for the tax year ending December 31, 2025 and future years.
5. Each Subsidiary Partnership intends to continue to be organized and operate in a manner which will allow it to be treated as a partnership and not as an association taxable as a corporation for the tax year ending December 31, 2025 and future years.
6. The Company is duly formed and existing under the laws of the State of Georgia and is duly authorized to transact business in the State of Georgia.
II. Issue Considered—REIT Status
A. Since the commencement of the Company’s taxable year which began January 1, 2016 through the tax year ended December 31, 2024, has the Company been organized in conformity with the requirements for qualification as a REIT under the IRC, and has its actual method of operation enabled, and will its proposed method of organization and operation enable, the Company to continue to meet the requirements for qualification and taxation as a REIT?
B. Whether the Operating Partnership is classified as a corporation or as an association taxable as a corporation as defined in the IRC and Regulations?
III. Conclusion Reached
Based upon and subject to the foregoing, we are of the opinion that:
A. REIT Status
Since the commencement of the Company’s taxable year which began January 1, 2016 through the tax year ended December 31, 2024, the Company has been organized and has operated in conformity with the requirements for qualification and taxation as a REIT under the IRC, and its actual method of operation has enabled, and its proposed method of organization and operation will enable, the Company to continue to meet the requirements for qualification and taxation as a REIT for its taxable year ending December 31, 2025, and thereafter. The Company’s qualification and taxation as a REIT depends upon its ability to meet, through actual, annual operating results, certain requirements including requirements relating to distribution levels, diversity of stock ownership, composition of assets and sources of income, and the various qualification tests imposed under the IRC. Accordingly, no assurance can be given that the actual results of the Company’s organization and operation for any period subsequent to the date of this opinion will satisfy the requirements for taxation as a REIT under the IRC.
June 6, 2025
Page 5
B. Operating Partnership Status
The Operating Partnership is not classified as a corporation or as an association taxable as a corporation as defined in the IRC and Regulations.
IV. Law & Analysis
A. REIT Status
1. Organizational Requirements. In order to qualify as a REIT for federal income tax purposes, IRC §856 requires that an entity meet the following organizational tests:
(1) it must be organized as a corporation, trust, or association;
(2) it must be managed by one or more trustees or directors;
(3) beneficial ownership must be evidenced by transferable shares or certificates;
(4) it must be taxable as a domestic corporation but for the operation of IRC §§856 through 859;
(5) it must not be a financial institution or insurance company;
(6) beneficial ownership must be held by 100 or more persons;
(7) subject to the provisions of IRC §856(k), it must not be closely held as determined under IRC §856(h);
(8) it must use the calendar year as its taxable year; and
(9) it must elect to be taxed as a REIT or have in effect such an election made for a previous taxable year.
The requirements described in (1) through (5) above must be met during the entire taxable year. The requirement described in (6) above must exist during at least 335 days of a taxable year of 12 months, or during a proportionate part of a taxable year of less than 12 months. The requirement described in (7) above must be met during the last half of each taxable year of the REIT. The requirements described in (6) and (7) above do not apply to the first taxable year for which an election is made under IRC §856(c)(1).
The Company has represented that it has satisfied the requirements of (1) through (5) above for all years since January 1, 1987. The Company has also represented that it has satisfied the requirements of (6) and (7) above for all tax years for which it elected to be taxed as, or otherwise has calculated its taxable income as, a REIT consistent with the provisions of IRC §857(b)(2). Further, the Company has represented that it expects, and intends to take all necessary measures within its control to ensure that the beneficial ownership of the Company will at all times be held by 100 or more persons.
June 6, 2025
Page 6
In addition, subject to certain exceptions, the Company’s Articles of Incorporation, Article 11 A (1), states that after December 31, 1986, shares of stock of the Company shall not be transferable to any person if such transfer would cause the person to be an owner of more than 3.9 percent in value of the outstanding shares, including both common and preferred stock (the “Limit”). If such a transfer occurs, the Articles of Incorporation provide that the transfer will be void and the intended transferee will acquire no rights to the shares. Article 11 A (2) states that other than a shareholder who already exceeded the Limit on December 31, 1986 (a “Prior Owner”), no shareholder shall at any time own shares that exceed the Limit. The Board of Directors, however, is provided authority to exempt shareholders from the operation of Articles 11 A (1) and (2). The Company has represented that the Board of Directors granted Exemptions on June 15, 2004, as amended on April 25, 2008, as further terminated on January 25, 2011, on February 21, 2007, on March 31, 2008, on May 15, 2008, as superseded on December 8, 2009, as further superseded on October 19, 2011, as further superseded on January 30, 2015, and as further superseded on April 23, 2024, on September 15, 2009, as amended on December 8, 2009, as further amended on December 24, 2010, as further amended on March 13, 2013, as further amended on March 8, 2019 and on June 7, 2021; on December 9, 2010, on January 16, 2014, on October 6, 2016, as terminated on March 2, 2017, on December 15, 2017, on September 29, 2023, and on April 30, 2025 (cumulatively, the “Waivers”). The Company has represented that each shareholder granted a Waiver was widely held, as defined in that respective Waiver. Article 11 A (3) restricts Prior Owners from receiving additional shares except in certain circumstances. The shares causing a violation of any of these provisions (“Excess Shares”) are deemed transferred to the Company as trustee for a trust. The interest in the trust will be freely transferable by the intended transferee. Once the intended transferee of the Excess Shares has transferred the trust interest to an owner not violating the Limit, the shares are no longer Excess Shares and the intended transferee’s interest in the trust is extinguished.
Article 11 A (6) states that if a person acquires shares in excess of the Limit and such acquisition causes the Company to not qualify as a REIT under the five or fewer rule applicable for purposes of IRC §856(h), such person shall be liable for the corporate taxes that are due until REIT status can be re-elected.
Pursuant to Treasury Regulation §1.856-1(d)(2), “…Provisions in the trust instrument or corporate charter or bylaws which permit the trustee or directors to redeem shares or to refuse to transfer shares in any case where the trustee or directors, in good faith, believe that a failure to redeem shares or that a transfer of shares would result in the loss of status as a real estate investment trust will not render the shares ‘nontransferable.’”1
The Company has represented that it does not and will not impose, and is not aware of, any transfer restrictions on its outstanding shares of beneficial interest other than those restrictions contained in the Company’s Articles of Incorporation (as described above), which are intended to enable the Company to comply with certain REIT qualification requirements as set forth in IRC §856(a)(6).
1 See, e.g., Priv. Ltr. Rul. 9430022 (April 29, 1994) (excess shares deemed transferred to a charity); Priv. Ltr. Rul. 8921067 (February 28, 1989).
June 6, 2025
Page 7
The Company has represented that it has used the calendar year as its taxable year since 1987. The Company has also represented that it made an election to be taxed as a REIT for each year commencing with the taxable year beginning January 1, 1987 and that it intends to take all necessary measures within its control to ensure that it meets the REIT organizational requirements in the current and future years. Furthermore, the Company has represented that it qualified as a REIT for federal income tax purposes from January 1, 1987 through December 31, 2015.
In addition to the organizational requirements listed above, a REIT must satisfy ongoing requirements concerning the nature of its income and assets, the payment of dividends and the maintenance of records.
2. Income Tests. For each taxable year, a REIT must satisfy certain income tests under IRC §856(c).
(1) at least 75 percent of a REIT’s gross income (excluding gross income from prohibited transactions, cancellation of indebtedness income, and hedging transactions described in IRC §856(c)(5)(G) entered into after July 30, 2008) must consist of rents from real property, interest on obligations secured by mortgages on real property or on interests in real property, gain from the sale of real property that was not held primarily for sale to customers in the ordinary course of business, dividends from other REITs and gain from the sale of REIT shares, refunds and abatements of real property taxes, income and gain from foreclosure property, loan commitment and certain other fees, qualified temporary investment income (as that term is defined in IRC §856(c)(5)(D)) and gain from the sale of certain other property; and
(2) at least 95 percent of a REIT’s gross income (excluding gross income from prohibited transactions, cancellation of indebtedness income, and hedging transactions described in IRC §856(c)(5)(G)(i) for taxable years beginning on or after January 1, 2005 and hedging transactions described in IRC §856(c)(5)(G)(ii) entered into after July 30, 2008) must consist of items that would be includible in (1) above, and dividends, interest and gain from the sale or other disposition of stocks or securities.
For purposes of applying the income and the asset tests, the Company is treated as owning directly the assets and receiving the income of (i) any subsidiary (exclusive of any “taxable REIT subsidiary” as such term is defined in IRC §856(l) (a “TRS”)) of the Company in which: (a) with respect to all taxable years beginning on or before August 5, 1997, the Company has owned 100 percent of the stock at all times during the period of such subsidiary’s existence, and (b) with respect to all taxable years beginning after August 5, 1997, the Company owns, or has owned, 100 percent of such subsidiary (a “Qualified REIT Subsidiary” or “QRS”), (ii) each of any partnership (within the meaning of (and including any limited liability company or other entity classified as a partnership for federal income tax purposes) IRC §7701(a)(2) and the regulations promulgated thereunder) in which the Company or any QRS has held an interest, directly or
June 6, 2025
Page 8
indirectly (a “Subsidiary Partnership”),2 and (iii) any limited liability company (which has not elected to be classified as a corporation for federal income tax purposes) all of the interests in which are held by the Company, any QRS, or any Subsidiary Partnership directly, and/or indirectly through one or more other such limited liability companies (a “Disregarded LLC”)3.
Based upon this “look through” approach, the rents received by the Company will qualify as “rents from real property” for the 75 percent gross income test provided they are rents from interests in real property, charges for services customarily furnished or rendered in connection with the rental of real property and rent attributable to personal property which is leased under, or in connection with, a lease of real property, but only if the rent attributable to such personal property for the taxable year does not exceed 15 percent of the total rent, for both real and personal property, for the taxable year. Specifically excluded from the definition of rents from real property is (1) rent determined on the basis, in whole or part, of any person’s income or profits from the property (exclusive of rent based on a fixed percentage or percentages of receipts or sales); (2) rent received, directly or indirectly, from a tenant in which the REIT has an ownership interest (directly or indirectly) of 10 percent or more; and (3) for any “impermissible tenant service income” (as that term is defined in IRC §856(d)(7)).
The Company has represented that it has satisfied both of the income tests outlined above for each taxable year since January 1, 1987. It has also represented that it intends to take all necessary measures within its control to ensure that it meets such tests during each of its future taxable years. In addition, the Company has represented that it qualified as a REIT for federal income tax purposes from January 1, 1987 through December 31, 2015.
For taxable years beginning before January 1, 2005, if the Company fails to meet either income test (1) or (2) above, it may still qualify as a REIT in such taxable year if it reports the source and nature of each item of its gross income in its federal income tax return for such year, the inclusion of any incorrect information in its return is not due to fraud with intent to evade tax and the failure to meet such tests is due to reasonable cause and not to willful neglect. Under a relief provision enacted on October 22, 2004 as part of the American Jobs Creation Act of 2004, for taxable years beginning on or after January 1, 2005, a REIT may continue to qualify as a REIT if following the Company’s identification of a failure to satisfy one or both of the income tests for any taxable year, a description of each item of its gross income that qualifies for the tests is set forth in a schedule for such taxable year filed in accordance with Regulations, and such failure is due to reasonable cause and not due to willful neglect. Under both relief provisions, the
2 In the case of a REIT which is a partner in a partnership, as defined in IRC §7701(a)(2) and the regulations thereunder, the REIT will be deemed to own its proportionate share of each of the assets of the partnership and will be deemed to be entitled to the income of the partnership attributable to such share. For purposes of IRC §856, the interest of a partner in the partnership's assets shall be determined in accordance with his capital interest in the partnership. The character of the various assets in the hands of the partnership and items of gross income of the partnership shall retain the same character in the hands of the partners for all purposes of IRC §856. Treas. Reg. §1.856-3(g).
3 Solely for purposes of applying the 10 percent value test in looking through any partnership to determine the REIT’s allocable share of any securities owned by the partnership, the REIT’s share of the assets of the partnership will correspond not only to the REIT’s interest as a partner in the partnership but also to the REIT’s proportionate interest in certain debt securities issued by the partnership. See IRC §856(m)(3).
June 6, 2025
Page 9
Company would be subject to a tax on the excess non-qualifying income. The Company has represented that if it fails to meet the requirements of either IRC §§856(c)(2) or (c)(3) (or both) in any taxable year, it intends to avail itself of the provisions of IRC §856(c)(6) (whereby it will be considered to have satisfied the requirements of such paragraphs) if such failure is due to reasonable cause and not due to willful neglect.
3. Asset Tests. At the close of each quarter during each taxable year, a REIT must satisfy four tests under IRC §856(c)(4).
For tax years beginning on or before December 31, 2000:
(1) at least 75 percent of the value of a REIT’s total assets must consist of real estate assets, cash and cash items (including receivables) and Government securities;
(2) not more than 25 percent of the value of a REIT’s total assets may consist of securities, other than those includible under (1) above;
(3) not more than 5 percent of the value of a REIT’s total assets may consist of securities of any one issuer, other than those securities includible under (1) above; and
(4) not more than 10 percent of the outstanding voting securities of any one issuer may be held by the REIT, other than those securities includible under (1) above.
For tax years beginning after December 31, 2000:
(1) at least 75 percent of the value of a REIT’s total assets must consist of real estate assets, cash and cash items (including receivables) and Government securities;
(2) not more than 25 percent of the value of a REIT’s total assets may consist of securities, other than those includible under (1) above;
(3) not more than 20 percent4 of the value of a REIT’s total assets may consist of securities of one or more TRSs;
(4) except with respect to a TRS and securities includible under (1) above (i) no more than 5 percent of the value of a REIT’s total assets may consist of securities of any one issuer; (ii) a REIT may not hold securities possessing more than 10 percent of the total voting power of the outstanding securities of any one issuer; and (iii) a REIT may not hold securities having a value of more than 10 percent of the total value of the outstanding securities of any one issuer (the “Single Issuer Security Limitation”); and
4 Effective for tax years beginning after July 30, 2008, and on or before December 31, 2017, not more than 25 percent of the value of a REIT’s total assets may consist of securities of one or more TRSs.
June 6, 2025
Page 10
(5) for taxable years beginning after December 31, 2015, not more than 25 percent of the value of a REIT’s total assets is represented by nonqualified publicly offered REIT debt instruments.
The following assets are not treated as “securities” held by a REIT for purposes of the 10 percent value test described in (4)(iii) above:
(1) “Straight debt” meeting certain requirements described in IRC §856(m)(2), unless the REIT holds (either directly or through controlled TRSs) certain other securities of the same corporate or partnership issuer that have an aggregate value greater than 1 percent of such issuer’s outstanding securities;
(2) Loans to individuals or estates;
(3) Certain rental agreements calling for deferred rents or increasing rents that are subject to IRC §467, other than with certain related persons;
(4) Obligations to pay the REIT amounts qualifying as “rents from real property” under the 75 percent and 95 percent gross income tests;
(5) Securities issued by a state or any political subdivision of a state, the District of Columbia, a foreign government, any political subdivision of a foreign government, or the Commonwealth of Puerto Rico, but only if the determination of any payment received or accrued under the security does not depend in whole or in part on the profits of any entity not described in this category or payments on any obligation issued by such an entity;
(6) Securities issued by a qualifying REIT; and
(7) Other arrangements identified in Regulations (which have not yet been issued or proposed).
In addition, any debt instrument issued by a partnership will not be treated as a “security” for purposes of the 10 percent value test if at least 75 percent of the partnership’s gross income (excluding gross income from prohibited transactions) is derived from sources meeting the requirements of the 75 percent gross income test. If at least 75 percent of the partnership’s gross income is not derived from sources meeting the requirements of the 75 percent gross income test, then the debt instrument issued by the partnership nevertheless will not be treated as a “security” to the extent of the REIT’s interest as a partner in the partnership. Also, in looking through any partnership to determine the REIT’s allocable share of any securities owned by the partnership, the REIT’s share of the assets of the partnership, solely for purposes of applying the 10 percent value test in taxable years beginning on or after January 1, 2008, will correspond not only to the REIT’s interest as a partner in the partnership but also to the REIT’s proportionate interest in certain debt securities issued by the partnership.
June 6, 2025
Page 11
Failure to satisfy any of the asset tests discussed above at the end of any quarter, without curing such failure within 30 days after the end of such quarter, would generally result in the disqualification of the entity as a REIT,5 unless certain relief provisions enacted as part of the American Jobs Creation Act of 2004 are available. Under a de minimis failure relief provision, the failure of the 5 percent asset test, the 10 percent voting securities test, or the 10 percent value test, would not disqualify the REIT if the failure is due to the ownership of assets having a total value not exceeding the lesser of 1 percent of the total value of the REIT’s assets at the end of the relevant quarter or $10,000,000, and the REIT disposes of such assets (or otherwise meets such asset tests) within six months after the end of the quarter in which the failure was identified. If the REIT were to fail to meet any of the REIT asset tests for a particular quarter and the REIT did not qualify for the de minimis failure exception described in the preceding sentence, then the REIT would nevertheless be deemed to have satisfied the relevant asset tests if:
(1) following the REIT’s identification of the failure, the REIT files, in accordance with the Regulations, a schedule setting forth a description of each asset that caused the failure;
(2) the failure to meet the requirements was due to reasonable cause and not due to willful neglect;
(3) the REIT disposes of the assets set forth in the schedule (or otherwise meets the relevant asset test) within six months after the last day of the quarter in which the identification of the failure occurred; and
(4) the REIT pays a tax equal to the greater of $50,000 or the amount determined by multiplying the highest corporate tax rate by the net income generated by the assets set forth in the schedule for the period beginning on the first date of the failure to meet the requirements and ending on the earlier of the date the REIT disposes of such assets or the end of the first quarter when there is no longer a failure to satisfy the asset tests.
These relief provisions apply to taxable years beginning after the date of enactment, but it is unclear whether they would apply to failures occurring in prior years, which are identified in tax years beginning after the date of enactment.
In the case of a REIT which is a partner in a partnership, as defined in IRC §7701(a)(2) and the regulations thereunder, a REIT will be deemed to own its proportionate share of each of the assets of the partnership and will be deemed to be entitled to the income of the partnership attributable to such share. For purposes of IRC §856, the interest of a partner in the partnership's assets shall be determined in accordance with his capital interest in the partnership, except that solely for purposes of applying the 10 percent value test in taxable years beginning on or after January 1, 2005, in looking through any partnership to determine the REIT’s allocable share of any securities owned by the partnership, the REIT’s share of the assets of the partnership will correspond not only to the REIT’s interest as a partner in the partnership but also to the REIT’s
5 See IRC §856(c)(4), flush language.
June 6, 2025
Page 12
proportionate interest in certain debt securities issued by the partnership. The character of the various assets in the hands of the partnership and items of gross income of the partnership shall retain the same character in the hands of the partners for all purposes of IRC §856.6 As such, a REIT’s ownership interest in a partnership is not subject to the Single Issuer Security Limitation. See discussion at ‘B. Subsidiary Partnership Status’ below for requirements for entities to qualify as partnerships for federal income tax purposes.
The Company has represented that it has satisfied each of the asset tests outlined above since January 1, 1987. It has also represented that it intends to take all necessary measures to ensure that it meets such tests at the end of each quarter of each of its future taxable years. In addition, the Company has represented that it qualified as a REIT for federal income tax purposes from January 1, 1987 through December 31, 2015.
For purposes of this opinion, we have assumed that each Subsidiary Partnership has been properly classified as a partnership for federal income tax purposes prior to January 1, 2015. In addition, based upon the representations of the Company as set forth in the Certificate of Representations, and the assumption that the Subsidiary Partnerships were properly classified as partnerships for federal income tax purposes prior to January 1, 2016, we conclude that the Subsidiary Partnerships have since January 1, 2016 been taxable as partnerships and not as associations taxable as corporations for federal income tax purposes, and they will continue to be taxable as partnerships and not as associations taxable as corporations for federal income tax purposes. As such, the Company’s ownership interest in each Subsidiary Partnership since January 1, 2016 will not (in, and of, itself) cause it to fail to meet the Single Issuer Security Limitation.
For the current and all future taxable years, the Company has represented that it expects, and the Company intends to take all necessary measures within its control to ensure, that the Company has or will revalue its assets at the end of each quarter of each taxable year in which securities or other property is acquired and will eliminate within 30 days after the end of each such quarter any discrepancy between the value of the Company’s various investments and the requirements of the asset tests outlined above, to the extent such discrepancy is attributable in whole or in part to acquisitions during such quarter.
For all tax years beginning after December 31, 2000, the Company has represented that all debt securities, other than securities of a TRS and securities includible under IRC §856(c)(4)(A), held by the Company (i) have had a value of less than 10 percent of the total value of the outstanding securities of the issuer; or (ii) are not considered a “security” by reason of IRC §856(m). In addition, the Company has represented that any debt securities, other than securities of a TRS, that it will hold in the future will satisfy at least one of these three requirements.
The Company has represented that the Company and each of Cousins Real Estate Corporation (“CREC”), CREC II Inc. (“CREC II”), and MC Düsseldorf Holding B.V. (“Düsseldorf”) joined in a timely filed election to treat each of CREC, CREC II, and Düsseldorf as a TRS effective January 1, 2001. The Company has represented that it joined in an election to treat Captivate
6 Treas. Reg. §1.856-3(g).
June 6, 2025
Page 13
Network, Inc. (“Captivate”) as a TRS effective July 11, 2001. The Company has represented that the Company has at all times owned less than 10 percent of the vote and value of Captivate’s securities. The Company has also represented that it no longer owns any securities of CREC II, Captivate, or Düsseldorf.
The Company has represented that the Company and Cousins Properties Funding LLC (“Funding”) joined in a timely filed election to treat Funding as a TRS effective December 29, 2006. Additionally, the Company has represented that Funding filed an election to be taxed as an association effective as of December 29, 2006. The Company has represented that as of May 14, 2007, Funding merged into Cousins Properties Funding II, LLC (“Funding II”), an entity treated as a partnership for federal income tax purposes. Further, the Company has represented that as of March 1, 2009, Funding II merged into the Company. The Company has represented that the Company and Services joined in a timely filed election to treat Services as a TRS effective December 30, 2014. Additionally, the Company has represented that Services filed an election to be taxed as an association effective as of December 30, 2014. Further, the Company has represented that as of December 31, 2014, CREC merged into Cousins CPI Services LLC, an entity that is disregarded for federal income tax purposes.
The Company has represented that the Company and each of Terminus Master Condominium Association, Inc., City Center Property Owners Association, Inc., Northpark Town Center Association, Inc., Domain Building 2 Condominium Association, Inc, The Domain POA, Inc, Trade Tryon Plaza Condominium Association, Inc., Domain D11 Master Condominium Association, Inc., 725 Ponce Master Condominium Association Inc., and Avalon Phase II Commercial Condominium Association Inc. (collectively, the “Associations”) joined in a timely filed election to treat the Associations as a TRS. The Company has represented that the Company and AMLI Management Co. joined in a timely-filed election to treat AMLI Management Co. as a TRS effective August 26, 2016. The Company has represented that the Company and Cousins Masters TRS Austin Amenities, LLC joined in a timely-filed election to treat Cousins Masters TRS Austin Amenities, LLC as TRS effective October 6, 2016 and that Cousins Masters TRS Austin Amenities, LLC filed an election to be taxed as an association effective December 19, 2013. The Company has represented that the Company and 7000 Central Park Amenities LLC joined in a timely-filed election to treat 7000 Central Park Amenities LLC as TRS effective October 6, 2016 and that 7000 Central Park Amenities LLC filed an election to be taxed as an association effective December 20, 2013. The Company has represented that the Company and HICO 100 Mill TRS LLC joined in a timely-filed election to treat HICO 100 Mill TRS LLC as a TRS effective December 7, 2018 and that HICO 100 Mill TRS LLC filed an election to be taxed as an association effective as of December 7, 2018. The Company has represented that the Company and TIER Services, LLC joined in a timely-filed election to treat TIER Services, LLC as a TRS effective June 14, 2019, and that TIER Services, LLC filed an election to be taxed as an association effective as of June 9, 2015. The Company has represented that the Company and ABM Industries Inc. joined in a timely-filed election to treat ABM Industries Inc. as a TRS effective June 14, 2019. The Company has represented that the Company and Avalon Phase II Commercial Condominium Association Inc. joined in a timely-filed election to treat Avalon Phase II Commercial Condominium Association Inc. as a TRS effective June 8, 2022.
June 6, 2025
Page 14
The Company has represented that if it fails to meet the assets tests, it will take all actions necessary to avail itself of any relief provisions that could apply.
4. Distribution Requirement. During each taxable year, in order to qualify as a REIT, the deduction for dividends paid (computed without regard to capital gain dividends) must equal or exceed the following:
(1) the sum of (a) 95 percent (90 percent for taxable years beginning after December 31, 2000) of real estate investment trust taxable income computed without regard to the deduction for dividends paid and excluding net capital gain, and (b) 95 percent (90 percent for taxable years beginning after December 31, 2000) of the excess of net income from foreclosure property over the tax on such income; minus
(2) any excess non-cash income.
This requirement (the “Distribution Requirement”) is defined by reference to the dividends paid deduction. Therefore, only distributions that qualify for that deduction will count in meeting the Distribution Requirement.7
Such dividends must be paid in the taxable year to which they relate, or in the 12-month period following the close of such taxable year, if declared before the Company timely files it tax return for such taxable year and if paid on or before the first regular dividend payment after such declaration. Any dividend declared by the Company in October, November, or December of any calendar year and payable to shareholders of record on a specified date in such a month shall be deemed to have been paid on December 31 of such calendar year if such dividend is actually paid by the Company during January of the following calendar year. If a REIT has more than one class of stock, the Distribution Requirement must be met on an aggregate basis and not with respect to each separate class of stock. For taxable years ending on or before December 31, 2014, distributions within each class of stock must be pro rata and non-preferential. Further, any distribution shall not be considered as a dividend for purposes of computing the dividends paid deduction, unless such distribution is with no preference to one class of stock as compared with another class except to the extent that the former is entitled (without reference to waivers of their rights by shareholders) to such preference.
To the extent that a REIT does not distribute all of its net capital gain or distributes at least 95 percent (90 percent for taxable years beginning after December 31, 2000), but less than 100 percent, of its REIT taxable income, it will be subject to tax at regular corporate tax rates. A REIT may also be subject to an excise tax if it fails to meet certain other distribution requirements.
The Company has represented that it has satisfied the Distribution Requirement for each of its tax years commencing with the tax year beginning January 1, 1987. In addition, the Company
7 See IRC §§561 and 562.
June 6, 2025
Page 15
has represented that it qualified as a REIT for federal income tax purposes from January 1, 1987 through December 31, 2015.
Because of timing differences between the inclusion of income and deduction of expenses in arriving at taxable income, and because the amount of nondeductible expenses, such as principal amortization and capital expenditures, could exceed the amount of non-cash deductions such as depreciation, it is possible that the Company may not have sufficient cash or liquid assets at a particular time to satisfy the Distribution Requirement. In such event, the Company may declare a consent dividend, which is a hypothetical distribution to shareholders out of the earnings and profits of the Company. The effect of such a consent dividend, to those shareholders who agree to such treatment, would be that such shareholders would be treated for federal income tax purposes as if such amount had been paid to them in cash and they had then immediately contributed such amount back to the Company as additional paid-in capital. This treatment would result in taxable income to those shareholders without the receipt of any actual cash distribution, but it would also increase their tax basis in their stock by the amount of the taxable income recognized. A consent dividend does not include amounts which, if distributed in money, would constitute or be part of a preferential distribution as defined in IRC §562(c).8
In determining whether it has paid dividends for any year in an amount sufficient to meet the Distribution Requirement, the Company has represented that it disregarded any dividends treated as “preferential dividends” under IRC §562(c) prior to December 31, 2015 and, if any dividend not so disregarded is determined to be a preferential dividend (or if the Company is determined to have failed for any other reason to pay the amount of dividends required by the preceding sentence), then the Company will pay a deficiency dividend as necessary to avoid being disqualified as a REIT.
If the Company fails to meet the Distribution Requirement in any taxable year due to an adjustment to the Company’s income by reason of a judicial decision, by agreement with the Internal Revenue Service (“IRS”), or, for taxable years beginning on or after January 1, 2009, as a result of the Company’s determination and reporting of an adjustment, the Company may pay a deficiency dividend to its shareholders, which would relate back to the taxable year being adjusted for purposes of meeting the Distribution Requirement in such taxable year. In such case, the Company would also be required to pay interest plus a penalty to the IRS.9 The Company has represented that if it is determined to have failed, for any reason, to pay the amount of dividends sufficient to meet the Distribution Requirement, then the Company will pay a deficiency dividend as necessary to avoid being disqualified as a REIT. In the event it is determined that the Company’s income should be adjusted for any taxable year, and such adjustment would otherwise result in disqualification of the Company as a REIT for failure to meet the minimum distribution requirement for such year, the Company has represented that it intends timely to declare and pay a deficiency dividend in accordance with IRC §860 in order to avoid being disqualified as a REIT.
8 See IRC §565(b)(1).
9 See IRC §860.
June 6, 2025
Page 16
If the Company cannot declare a consent dividend or if it lacks sufficient cash to distribute 95 percent (90 percent for taxable years beginning after December 31, 2000) of its REIT taxable income or to pay a deficiency dividend in appropriate circumstances, the Company could be required to borrow funds or liquidate a portion of its investments in order to pay its expenses, make the required cash distributions to shareholders, or satisfy its tax liabilities. There can be no assurance that such funds will be available to the extent, and at the time, required by the Company, in which case its status as a REIT could be lost.
5. Other Requirements. In addition to the foregoing, a corporation may not compute its taxable income as a real estate investment trust consistent with the provisions of IRC §857(b)(2) unless: (i) the provisions of the IRC, Subtitle A, Chapter 1, Subchapter M, Part II (i.e., IRC §§856 through 859, the “REIT Sections”) applied to the corporation for all taxable years beginning after February 28, 1986, or (ii) as of the close of the taxable year, the corporation has no earnings and profits accumulated in any “non-REIT year.”10 For this purpose, the term “non-REIT year” means any taxable year to which the provisions of the REIT Sections did not apply with respect to the corporation. The Company has represented that other than earnings and profits that were grandfathered under IRC §857(a)(2)(A) related to taxable years beginning before February 28, 1986, it has no, and will continue to have no, accumulated earnings and profits from any taxable year for which it did not qualify as a REIT and has not succeeded by reason of any merger or other non-taxable acquisition of assets (including any deemed acquisition of assets resulting from an election to treat a subsidiary as a QRS) to the earnings and profits of any other entity taxable as a corporation. If, by reason of any merger (directly or through a QRS) or other non-taxable acquisition of assets (including any deemed acquisition of assets resulting from an election to treat a subsidiary as a QRS), the Company does succeed to the earnings and profits of any other entity taxable as a corporation, then the Company intends to distribute to the Company’s shareholders all of such earnings and profits before the close of the taxable year of such merger or acquisition. In the event of a determination (as defined in IRC §860(e)) that the Company has any such undistributed earnings and profit, the Company intends to timely avail itself of the relief provisions of Treasury Regulation §1.857-11(c) and IRC §852(e) and declare and pay to its shareholders a qualified designated distribution or distributions in an amount or amounts sufficient to eliminate such earnings and profits.
The Company has represented that if it discovers that it did not satisfy one or more of the REIT income, asset, distribution, or other requirements for any taxable year or quarter, as the case may be, it will take all action contemplated by IRC §§562(e)(2), 856(c)(6), 856(c)(7), 856(g)(5), and 860, as the case may be, in order to maintain its status as a REIT for such year or quarter and all succeeding years or quarters, including: (i) making the disclosure required by IRC §§856(c)(6)(A) and 856(c)(7)(A)(i) (in the case of certain income and asset test violations); and (ii) disposing of assets in the manner contemplated, and in accordance with the deadlines established, by IRC §§856(c)(7)(A)(iii) and 856(c)(7)(B)(ii) to the extent necessary to bring the Company into compliance with the REIT asset requirements; and (iii) duly paying the related penalty tax, if any, imposed by IRC §§857(b)(5) (for income test violations), 856(c)(7)(C) (for asset test violations), and 856(g)(5)(C) (for violations of other qualification requirements applicable to REITs).
10 See IRC §857(a)(2).
June 6, 2025
Page 17
B. Operating Partnership Status
Effective as of January 1, 1997, the IRS adopted a classification system that permits a closely held unincorporated business to elect its tax status (the “Check-the-Box Rules”), discarding a four-factor classification system. An unincorporated domestic business entity (an “Eligible Entity” as defined in Regulation §301.7701-3(a) (as effective January 1, 1997)) with at least two members, formed on or after January 1, 1997, will generally be classified as a partnership for federal tax purposes unless it elects to be treated as an association taxable as a corporation.11 Under the Check-the-Box Rules, an Eligible Entity in existence prior to January 1, 1997, will have the same classification that the entity claimed under Regulations §§301.7701-1 through 301.7701-3 (as in effect prior to January 1, 1997).12
A partnership can nonetheless be taxed as a corporation if it is a publicly traded partnership under IRC §7704. A publicly traded partnership is a partnership whose interests are traded on any established securities market or are readily tradable on any secondary market or the substantial equivalent of any secondary market, including any matching system or program.13
The Company has represented that the Operating Partnership has not affirmatively elected or will not affirmatively elect (on a Form 8832 filed with the IRS or otherwise) to be classified as an association taxable as a corporation for federal income tax purposes. Moreover, the Company has represented that Operating Partnership will not change its form of organization.
The Company has also represented that no interests in the Operating Partnership have been or are traded on any established securities market or have been or are readily tradable on any secondary market or the substantial equivalent of any secondary market, including any matching system or program.
V. Limitations on Opinion. No assurances are or can be given that the IRS will agree with the foregoing conclusions in whole or in part although it is our opinion that they should. While the opinion represents our considered judgment as to the proper tax treatment to the parties concerned based upon the law as it existed at the relevant time periods and the facts as they were presented to us, it is not binding upon the IRS or the courts. In the event of any change to the applicable law or relevant facts, assumptions or representations, we would of necessity need to reconsider our views. In rendering this opinion, we have also considered and relied upon the IRC, the regulations promulgated thereunder, administrative rulings and the other interpretations of the IRC and Regulations by the courts and the IRS, all as they exist as of the date hereof. It should be noted, however, that the IRC, Regulations, judicial decisions, and administrative interpretations are subject to change at any time and, in some circumstances, with retroactive effect. We can give no assurance, therefore, that legislative enactments, administrative changes or court decisions
11 See Treas. Reg. §§301.7701-1 through 301.7701-4 (as effective January 1, 1997).
12 Treas. Reg. §301.7701-3(b)(3)(i) (as effective January 1, 1997).
13 See IRC §7704(b); Treas. Reg. §1.7704-1(a)(1).
June 6, 2025
Page 18
may not be forthcoming that would modify or supersede the opinion stated herein. In addition, there can be no assurance that positions contrary to our opinion will not be taken by the IRS, or that a court considering the issues will not hold contrary to such opinion. Moreover, this opinion represents our conclusions based upon the documents, facts, assumptions and representations referred to above. Any material amendments to such documents or changes in any significant facts after the date hereof, or inaccuracy of such assumptions or representations could affect the opinion referred to herein.
This opinion is expressed as of the date hereof, and we disclaim any undertaking to advise you of any subsequent changes of matters stated, represented, covenanted, or assumed herein or any subsequent changes in applicable law. You understand and agree that this opinion is solely for the Company’s information and benefit, is limited to the described transaction, and may not be relied upon, distributed, disclosed, made available to, or copied by anyone, without prior written consent or as described herein.
In addition, this opinion is based upon:
a. the representations, information, documents and other facts provided to us, our personnel and any representatives thereof and that we have included or referenced in this tax opinion letter;
b. our assumption that all of the representations used in our analysis and all of the originals, copies, and signatures of documents reviewed by us are accurate, true, and authentic;
c. our assumption that there will be timely execution and delivery of and performance as required by the representations and documents;
d. the law, regulations, cases, rulings, and other taxing authority in effect as of the date of this tax opinion. If there are subsequent changes in or to the foregoing taxing authorities (for which we shall have no specific responsibility to advise you), such changes may result in our tax opinion being rendered invalid or necessitate (upon your request) a reconsideration of the tax opinion;
e. your understanding that Deloitte Tax was only engaged to provide a tax opinion with respect to the specific tax issues and tax consequences addressed herein and no other federal, state, or local tax matters of any kind were considered;
f. your understanding that the matters addressed in this tax opinion may be audited and challenged by the IRS and other tax agencies, who may not agree with our conclusions. In this regard, you understand that the tax opinion is not binding on the IRS, other tax agencies or the courts and should never be considered a representation, warranty, or guarantee that the IRS, other tax agencies or the courts will concur with the tax opinion; and
June 6, 2025
Page 19
g. your understanding that this tax opinion letter is solely for your benefit, is limited to the described transaction, and may not be relied upon by any other person or entity (except as set forth in the second paragraph of this opinion letter).
Very truly yours,
/s/ Deloitte Tax LLP