FIRST POTOMAC REALTY TRUST Common Shares of Beneficial Interest (par value $.001 per share) UNDERWRITING AGREEMENT
Exhibit 1.1
FIRST POTOMAC REALTY TRUST
Common Shares of Beneficial Interest
(par value $.001 per share)
UNDERWRITING AGREEMENT
June 17, 2004
KeyBanc Capital Markets, | ||
a division of McDonald Investments Inc. | ||
Xxxxxxx Xxxxx & Associates, Inc. | ||
Xxxxxx X. Xxxxx & Co. Incorporated | ||
Advest, Inc. | ||
Xxxxxx, Xxxxx Xxxxx, Incorporated | ||
c/x XxXxxxxx Investments Inc. | ||
XxXxxxxx Investment Center | ||
000 Xxxxxxxx Xxxxxx | ||
Xxxxxxxxx, Xxxx 00000 |
Ladies and Gentlemen:
INTRODUCTORY. First Potomac Realty Trust, a Maryland real estate investment trust (the “Company”), proposes to issue and sell to the several underwriters named in Schedule A (the “Underwriters”) an aggregate of 4,800,000 of its common shares (the “Firm Shares”) of beneficial interest, par value $.001 per share (the “Common Shares”). In addition, the Company has granted to the Underwriters an option to purchase up to an additional 720,000 Common Shares (the “Option Shares”), as provided in Section 2. The Firm Shares and, if and to the extent such option is exercised, the Option Shares are collectively called the “Shares.” KeyBanc Capital Markets, a division of McDonald Investments Inc. (“KCM”), has agreed to act as representative of the several Underwriters (in such capacity, the “Representative”) in connection with the offering and sale of the Shares.
The Company is the sole general partner of First Potomac Realty Investment Limited Partnership (the “Operating Partnership”), a Delaware limited partnership that serves as the Company’s primary operating partnership subsidiary.
The Company has prepared and filed with the Securities and Exchange Commission (the “Commission”) a registration statement on Form S-11 (File No. 333-115958), which contains a form of prospectus to be used in connection with the public offering and sale of the Shares. Such registration statement, as amended, including the financial statements, exhibits and schedules thereto, in the form in which it was declared effective by the Commission under the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder (collectively, the “Securities Act”), including any information deemed to be a part thereof at the time of effectiveness pursuant to Rule 430A under the Securities Act, is called the “Registration Statement.” Any registration statement filed by the Company pursuant to Rule 462(b) under the
Securities Act is called the “Rule 462(b) Registration Statement,” and from and after the date and time of filing of the Rule 462(b) Registration Statement, the term “Registration Statement” shall include the Rule 462(b) Registration Statement. Such prospectus, in the form first used by the Underwriters to confirm sales of the Shares, is called the “Prospectus.” All references in this Agreement to the Registration Statement, the Rule 462(b) Registration Statement, a preliminary prospectus or the Prospectus, or any amendments or supplements to any of the foregoing, shall include any copy thereof filed with the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval System (“XXXXX”).
Each of the Company and the Operating Partnership hereby confirms its agreements with the Underwriters as follows:
SECTION 1. REPRESENTATIONS AND WARRANTIES.
Each of the Company and the Operating Partnership hereby represents, warrants and covenants to each Underwriter as follows:
Each preliminary prospectus and the Prospectus when filed complied in all material respects with the Securities Act and, if filed by electronic transmission pursuant to XXXXX (except as may be permitted by Regulation S-T under the Securities Act), was identical to the copy thereof delivered to the Underwriters for use in connection with the offer and sale of the Shares. Each of the Registration Statement and any post-effective amendment thereto, at the time it became effective and at the date hereof, complied and complies in all material respects with the Securities Act and did not and does not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. Each preliminary prospectus, at the time of filing thereof, 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. The Prospectus, as amended and supplemented, as of its date and at all subsequent times up to and including the First Closing Date or the Second Closing Date, as the case may be, did not and will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The representations and warranties set forth in the three immediately preceding sentences do not apply to statements in or omissions from the Registration Statement, or any post-effective amendment thereto, any preliminary prospectus, or the Prospectus, or any amendments or supplements thereto, made in reliance upon and in conformity with information relating to any Underwriter furnished to the Company in writing by the Representative expressly for use therein.
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(d) Exhibits; Material Contracts. There are no contracts or other documents required to be described in the Prospectus or to be filed as exhibits to the Registration Statement which have not been described or filed as required. The contracts so described in the Prospectus to which the Company is a party have been duly authorized, executed and delivered by the Company, constitute valid and binding agreements of the Company, and are enforceable against and, to the Company’s knowledge by, the Company in accordance with their respective terms, except to the extent that the indemnification and contribution provisions set forth in Sections 6 and 7 of this Agreement may be limited by the federal and state securities laws and public policy considerations in respect thereof, and except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforceability of creditors’ rights generally. To the Company’s knowledge, no other party is in material breach of or material default under any of such contracts.
(e) The Underwriting Agreement. The Company has the trust power to enter into this Agreement and to perform its obligations and consummate the transactions contemplated herein. The Company has the trust power to issue, sell and deliver the Shares as provided herein. This Agreement has been duly authorized, executed and delivered by the Company and constitutes the valid and binding agreement of the Company enforceable against the Company in accordance with its terms, except to the extent that the indemnification and contribution provisions set forth in Sections 6 and 7 of this Agreement may be limited by the federal and state securities laws and public policy consideration in respect thereof, and except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforceability of creditors’ rights generally. The Operating Partnership has the full legal right, power and authority to enter into this Agreement and to perform its obligations and consummate the transactions contemplated herein. This Agreement has been duly authorized, executed and delivered by the Operating Partnership and constitutes the valid and binding agreement of the Operating Partnership enforceable against the Operating Partnership in accordance with its terms, except to the extent that the indemnification and contribution provisions set forth in Sections 6 and 7 of this Agreement may be limited by federal and state securities laws and public policy considerations in respect thereof, and except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting enforceability of creditors’ rights generally.
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(h) No Material Adverse Change. Except as otherwise disclosed in or contemplated by the Prospectus, subsequent to the respective dates as of which information is given in the Prospectus: (i) there has been no material adverse change, or any development that could reasonably be expected to result in a material adverse change, in the financial condition or in the earnings, business, operations or prospects, whether or not arising from transactions in the ordinary course of business, of the Company and the Subsidiaries (as defined below), considered as one enterprise (any such change or development is called a “Material Adverse Change”); (ii) the Company and the Subsidiaries, considered as one enterprise, have not incurred any material liability or obligation, indirect, direct or contingent, not in the ordinary course of business, nor entered into any material transaction or agreement not in the ordinary course of business; (iii) there has been no material casualty loss or condemnation or other material adverse event with respect to any of the real properties or interests in real properties owned by the Company and the Subsidiaries or the real properties described as being under contract in the Prospectus; (iv) there has been no change in the capital stock, long-term debt or short-term borrowings of the Company and the Subsidiaries on a consolidated basis, except for borrowings under the Company’s line of credit in the ordinary course of business, consistent with past practice, and (v) there has been no dividend or distribution of any kind declared, paid or made by the Company or, except for dividends or distributions paid to the Company or the Subsidiaries, any of the Subsidiaries on any class of capital stock or other equity interests, or any repurchase or redemption by the Company or any of the Subsidiaries of any class of capital stock or other equity interests. The properties currently owned by the Company’s Subsidiaries (the “Real Properties”) and the Suburban Maryland Portfolio properties described in the Prospectus as being under contract by the Company (the “Acquisition Properties”) are referred to collectively herein as the “Properties” and individually as a “Property.”
(i) Independent Accountants. KPMG LLP, which has expressed its opinion with respect to the financial statements (which term as used in this Agreement includes the related notes and schedules thereto) filed with the Commission as a part of the Registration Statement and included in the Prospectus, are independent public or certified public accountants with respect to each of the Company, Xxxxxxx Corporate Center, Aquia Commerce Center I & II, the Suburban Maryland Portfolio, Greenbrier Technology Center II, Norfolk Business Center, Xxxxxx Center, Xxxxxxx Center, Interstate Plaza, Virginia Center and Alexandria Corporate Park as required by the Securities Act, and Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (collectively, the “Exchange Act”).
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present fairly (i) the consolidated financial position of the Company and the Subsidiaries as of and at the dates indicated and the results of their operations and cash flows for the periods specified, (ii) the combined financial position of First Potomac Realty Investment Trust, Inc., First Potomac Realty Investment Limited Partnership and First Potomac Management, Inc. (collectively, “First Potomac Predecessor”), and (iii) the revenues and certain expenses of (A) Xxxxxxx Corporate Center, (B) Aquia Commerce Center I & II, and (C) the Suburban Maryland Portfolio, each for the three months ended March 31, 2004 and the year ended December 31, 2003, (iv) the revenues and certain expenses of (A) Greenbrier Technology Center II, (B) Norfolk Business Center, (C) Xxxxxx Center and (D) Xxxxxxx Center, each for the nine months ended September 30, 2002 and the year ended December 31, 2001, (v) the revenues and certain expenses of (A) Interstate Plaza and (B) Virginia Center, each for the six months ended June 30, 2003 and the year ended December 31, 2002, and (vi) and the revenues and certain expenses of Alexandria Corporate Park for the nine months ended September 30, 2003 and the year ended December 31, 2002. Any supporting schedules included in the Registration Statement present fairly the information required to be stated therein. Such financial statements and supporting schedules have been prepared in conformity with United States generally accepted accounting principles applied on a consistent basis throughout the periods involved, except as may be expressly stated in the related notes thereto, and are in compliance with Regulation S-X promulgated under the Securities Act. The pro forma consolidated financial statements of the Company and the Subsidiaries and the related notes thereto included in the Prospectus and the Registration Statement present fairly the information contained therein, have been prepared in accordance with the Commission’s rules and guidelines with respect thereto and have been properly presented on the bases described therein, and the assumptions used in the preparation thereof are reasonable and the adjustments used therein are appropriate to give effect to the transactions and circumstances referred to therein. The amounts in the Prospectus under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations” are accurately computed, fairly present the information shown therein and have been determined on a basis consistent with the financial statements included in the Registration Statement and the Prospectus. No other financial statements or supporting schedules are required under applicable law or the rules and regulations of the Commission to be included in the Registration Statement. The financial data set forth in the Prospectus under the captions “Summary —Summary Combined Financial Data,” “Capitalization” and “Selected Financial Information” fairly present the information set forth therein on a basis consistent with that of the financial statements contained in the Registration Statement when read in conjunction with the textual information included in those sections.
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accounting controls sufficient to provide reasonable assurances that (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences; and, to the Company’s knowledge, neither the Company, the Operating Partnership nor any Subsidiary, nor any employee or agent thereof, has made any payment of funds of the Company or any Subsidiary, as the case may be, or received or retained any funds, and no funds of the Company, the Operating Partnership or any Subsidiary, as the case may be, have been set aside to be used for any payment, in each case in violation of any law, rule or regulation.
(l) Organization and Good Standing of the Company and the Subsidiaries. The Company has been duly organized and is validly existing as a real estate investment trust in good standing with the State Department of Assessments and Taxation of the State of Maryland and has the trust power and authority to own, lease and operate its properties and to conduct its business as described in the Prospectus and to enter into and perform its obligations under this Agreement. Each of the subsidiaries listed on Exhibit 21 to the Registration Statement (each, including the Operating Partnership, except where noted, a “Subsidiary” and, collectively, the “Subsidiaries”) (i) that is a corporation has been duly incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation and has corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Prospectus, (ii) that is a limited liability company has been duly organized and is validly existing as a limited liability company in good standing under the laws of the jurisdiction of its organization and has limited liability company power and authority to own, lease and operate its properties and to conduct its business as described in the Prospectus and (iii) that is a limited partnership has been duly organized and is validly existing as a limited partnership in good standing under the laws of the jurisdiction of its organization and has the partnership power and authority to own, lease and operate its properties and to conduct its business as described in the Prospectus. The Operating Partnership has been duly organized and is validly existing as a limited partnership in good standing under the laws of the jurisdiction of its organization and has limited partnership power and authority to own, lease and operate its properties, to conduct its business as described in the Prospectus and to enter into and perform its obligations under this Agreement. Each of the Company and the Subsidiaries is duly qualified as a foreign trust corporation, limited partnership or limited liability company, as the case may be, 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 for such jurisdictions where the failure to so qualify or to be in good standing would not, individually or in the aggregate, result in a Material Adverse Change. All of the issued and outstanding capital stock of each Subsidiary that is a corporation has been duly authorized and validly issued, is fully paid and nonassessable and, except as described in the Prospectus, is owned by the Company, directly or through subsidiaries, free and clear of any security interest, mortgage, pledge, lien, claim, restriction or encumbrance, and all of the issued and outstanding membership interests of each Subsidiary that is a limited liability company, and all of the partnership interests of each Subsidiary that is a limited partnership, have been duly authorized and validly issued and are fully paid and, except
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as described in the Prospectus, are owned by the Company, directly or through Subsidiaries, free and clear of any security interest, mortgage, pledge, lien, claim, restriction or encumbrance. All of the issued and outstanding units of partnership interest of the Operating Partnership (“Units”) have been duly authorized and validly issued and are fully paid and upon completion of the offering of the Firm Shares, the Company will be the sole general partner of the Operating Partnership and will own Units representing an approximately 90.6% interest in the Operating Partnership, free and clear of any security interest, mortgage, pledge, lien, claim, restriction or encumbrance. The Company does not own or control, directly or indirectly, any corporation, association or other entity other than the Subsidiaries.
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a party or by which it or any of them may be bound, or to which any of the property or assets of the Company or any of the Subsidiaries is subject (each, an “Existing Instrument”), except such Defaults as would not, individually or in the aggregate, result in a Material Adverse Change. The execution, delivery and performance of this Agreement by the Company and the Operating Partnership and consummation of the transactions contemplated hereby and by the Prospectus (i) will not result in any violation of the provisions of the (A) Amended and Restated Declaration of Trust (the “Declaration of Trust”) or by-laws of the Company, (B) the Certificate of Limited Partnership or Amended and Restated Agreement of Limited Partnership (the “Partnership Agreement”) of the Operating Partnership or (C) other organizational documents of the Company or any of the Subsidiaries, in each case as amended or as amended and restated through the date hereof, (ii) will not conflict with or constitute a breach of, or a Default or Debt Repayment Triggering 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 Company or any of the Subsidiaries pursuant to, or require the consent of any other party to, any Existing Instrument, except such consents as have been obtained by the Company, and (iii) will not result in any violation of any law, administrative regulation or administrative or court decree applicable to the Company or any of the Subsidiaries. No consent, approval, authorization or other order of, or registration or filing with, any court or other governmental or regulatory authority or agency, is required for the Company’s execution, delivery and performance of this Agreement and consummation of the transactions contemplated hereby and by the Prospectus, except (A) such as have been obtained or made by the Company and are in full force and effect (B) under the Securities Act and applicable state securities or blue sky laws and (C) from the National Association of Securities Dealers, Inc. (the “NASD”).
As used herein, a “Debt Repayment Triggering Event” means any event or condition which gives, or with the giving of notice or lapse of time or both would give, the holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by the Company or any of the Subsidiaries.
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due and payable, any related or similar assessment, fine or penalty levied against any of them. The Company has made adequate charges, accruals and reserves in the applicable financial statements referred to in Section 1(j) above in respect of all federal, state and foreign income and franchise taxes for all periods as to which the tax liability of the Company or any of the Subsidiaries has not been finally determined.
(w) Company Not an “Investment Company.” The Company has been advised of the rules and requirements under the Investment Company Act of 1940, as amended (the “Investment Company Act”). The Company is not, and after receipt of payment for the Shares will not be, an “investment company” within the meaning of the Investment Company Act and will conduct its business in a manner so that it will not become subject to the Investment Company Act.
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Subsidiaries or, to the Company’s knowledge, any other owners of any of the Properties at any time or any other party, has at any time released (as such term is defined in CERCLA (as defined below)) or otherwise disposed of Hazardous Materials (as defined below) on, to, in, under or from the Properties or any other real properties previously owned, leased or operated by the Company or any of the Subsidiaries, (iii) neither the Company nor any of the Subsidiaries intends to use the Properties or any subsequently acquired properties, other than in compliance with applicable Environmental Laws, (iv) neither the Company nor any of the Subsidiaries has received any notice of, or has any knowledge of any occurrence or circumstance which, with notice or passage of time or both, would give rise to a claim under or pursuant to any Environmental Law with respect to the Properties, any other real properties previously owned, leased or operated by the Company or any of the Subsidiaries, or the assets of the Company or the Subsidiaries described in the Prospectus or arising out of the conduct of the Company or the Subsidiaries, (v) none of the Properties are included or proposed for inclusion on the National Priorities List issued pursuant to CERCLA by the United States Environmental Protection Agency or, to the Company’s knowledge, proposed for inclusion on any similar list or inventory issued pursuant to any other Environmental Law or issued by any other Governmental Authority (as defined below), (vi) none of the Company, any of the Subsidiaries or agents or, to the Company’s knowledge, any other person or entity for whose conduct any of them is or may be held responsible under any applicable environmental law, has generated, manufactured, refined, transported, treated, stored, handled, disposed, transferred, produced or processed any Hazardous Material at any of the Properties, except in compliance with all applicable Environmental Laws, and has not transported or arranged for the transport of any Hazardous Material from the Properties or any other real properties previously owned, leased or operated by the Company or any of the Subsidiaries to another property, except in compliance with all applicable Environmental Laws, (vii) no lien has been imposed on the Properties by any Governmental Authority in connection with the presence on or off such Property of any Hazardous Material, and (viii) none of the Company, any of the Subsidiaries or, to the Company’s knowledge, any other person or entity for whose conduct any of them is or may be held responsible under any applicable Environmental Law, has entered into or been subject to any consent decree, compliance order, or administrative order with respect to the Properties or any facilities or improvements or any operations or activities thereon.
As used herein, “Hazardous Material” shall include, without limitation, any flammable materials, explosives, radioactive materials, hazardous materials, hazardous substances, hazardous wastes, toxic substances or related materials, asbestos, petroleum, petroleum products and any hazardous material as defined by any federal, state or local environmental law, statute, ordinance, rule or regulation, including, without limitation, the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C. §§ 9601-9675 (“CERCLA”), the Hazardous Materials Transportation Act, as amended, 49 U.S.C. §§ 5101-5127, the Resource Conservation and Recovery Act, as amended, 42 U.S.C. §§ 6901-6992k, the Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C. §§ 11001-11050, the Toxic Substances Control Act, 15 U.S.C. §§ 2601-2692, the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. §§ 136-136y, the Clean Air Act, 42 U.S.C. §§ 7401-7642, the Clean Water Act (Federal Water Pollution Control Act), 33 U.S.C. §§ 1251-1387, the Safe Drinking Water Act, 42 U.S.C. §§ 300f-300j-26, and the Occupational Safety and Health Act, 29 U.S.C. §§ 651-678, and any analogous state laws, as any of the above may be amended from time to time and in the regulations promulgated pursuant to each of the
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foregoing (including environmental statutes and laws not specifically defined herein) (individually, an “Environmental Law” and collectively, the “Environmental Laws”) or by any federal, state or local governmental authority having or claiming jurisdiction over the properties and assets of the Company and the Subsidiaries (a “Governmental Authority”).
(dd) Doing Business with Cuba. The Company is in compliance with all provisions of Florida Statutes Section 517.075 and the regulations thereunder, relating to issuers doing business with Cuba.
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Any certificate signed by an officer of the Company and delivered to the Representative or to counsel for the Underwriters shall be deemed to be a representation and warranty by the Company to each Underwriter as to the matters set forth therein.
SECTION 2. PURCHASE, SALE AND DELIVERY OF THE SHARES.
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It is understood that the Representative has been authorized, for its own account and the accounts of the several Underwriters, to accept delivery of and receipt for, and make payment of the purchase price for, the Firm Shares and any Option Shares the Underwriters have agreed to purchase. KCM, individually and not as Representative of the Underwriters, may (but shall not be obligated to) make payment for any Shares to be purchased by any Underwriter whose funds shall not have been received by the Representative by the First Closing Date or the Second Closing Date, as the case may be, for the account of such Underwriter, but any such payment shall not relieve such Underwriter from any of its obligations under this Agreement.
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the Shares shall be in definitive form and registered in such names and denominations as the Representative shall have requested at least two full business days prior to the First Closing Date (or the Second Closing Date, as the case may be) or in the form of one or more global certificates deposited with DTC and registered in the name of Cede & Co., as nominee for DTC, and shall be made available for inspection on the business day preceding the First Closing Date (or the Second Closing Date, as the case may be) at a location the Representative may reasonably designate.
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the Commission and the NYSE all reports and documents required to be filed under the Exchange Act.
(m) Company Not an “Investment Company.” The Company is familiar with the Investment Company Act of 1940, as amended, and the rules and regulations thereunder, and will in the future use its reasonable best efforts to ensure that the Company and the Operating Partnership will not be an “investment company” within the meaning of the Investment Company Act of 1940 and the rules and regulations thereunder.
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Company, or which may cause or result in, or which might in the future reasonably be expected to cause or result in, the stabilization or manipulation of the price of any security of the Company, to facilitate the sale or resale of any of the Shares, (ii) sell, bid for, purchase or pay anyone any compensation for soliciting purchases of the Shares or (iii) pay or agree to pay to any person any compensation for soliciting any order to purchase any other securities of the Company.
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or supplemented, shall contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.
(i) the Company shall have filed the Prospectus with the Commission (including the information required by Rule 430A under the Securities Act) in the manner and within the time period required by Rule 424(b) under the Securities Act; or the Company shall have filed a post-effective amendment to the Registration Statement containing the information required by such Rule 430A, and such post-effective amendment shall have become effective;
(ii) no stop order suspending the effectiveness of the Registration Statement or any post-effective amendment to the Registration Statement, shall be in effect and no proceedings for such purpose shall have been instituted or threatened by the Commission; and
(iii) the NASD shall have raised no objection to the fairness and reasonableness of the underwriting terms and arrangements.
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Properties; (iv) there shall not have occurred any change in the capital stock, long-term debt or short-term borrowings of the Company and the Subsidiaries on a consolidated basis, except for short-term borrowings under the Company’s line of credit in the ordinary course of business, consistent with past practice; and (v) there shall have been no dividend or distribution of any kind declared, paid or made by the Company or, except for dividends or distributions paid to the Company or Subsidiaries, any of the Subsidiaries on any class of capital stock or other equity interests or repurchase or redemption by the Company or any of the Subsidiaries of any class of capital stock or other equity interests, in each case except as disclosed in or contemplated by the Prospectus.
(f) Opinion of Counsel for the Company. On each of the First Closing Date and the Second Closing Date, the Representative shall have received the favorable opinion of each of (i) Hunton & Xxxxxxxx LLP, counsel for the Company and (ii) Xxxx Xxxxx LLP, Maryland counsel for the Company, each dated as of such Closing Date with respect to the matters listed on Exhibits A and B, respectively, each in form and substance reasonably satisfactory to counsel for the Underwriters.
(i) the Registration Statement has become effective under the Securities Act and no stop order suspending the effectiveness of the Registration Statement or preventing or suspending the use of the Prospectus has been issued, and no proceedings for that purpose have been instituted or are pending or, to their knowledge, threatened under the Securities Act;
(ii) they have reviewed the Registration Statement and the Prospectus, and (1) when the Registration Statement became effective and as of such Closing Date, the Registration Statement contained all statements and information required to be included therein or necessary to make the statements therein not misleading and the Registration Statement did not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not misleading, (2) at the date of the Prospectus and any supplement thereto, and at the First Closing Date or the Second Closing Date, as the case may be, such Prospectus (together with any supplement thereto) contained and contains all statements and information required to be included therein or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading, and such Prospectus (together with any supplement thereto) did not and does not include any untrue statement of a material fact or omit to state any material fact
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required to be stated therein or necessary in order to make the statement therein, in light of the circumstances in which they were made, not misleading; (3) since the effective date of the Registration Statement, there has occurred no event required to be set forth in an amended or supplemented Prospectus that has not been so set forth; and (4) for the period from and after the date of this Agreement and prior to such Closing Date, there has been no development that could reasonably be expected to result in a Material Adverse Change;
(iii) the representations, warranties and covenants of the Company set forth in this Agreement are true and correct with the same force and effect as though expressly made on and as of such Closing Date; and
(iv) the Company has complied with all the agreements hereunder and satisfied all the conditions on its part to be performed or satisfied hereunder at or prior to such Closing Date.
If any condition specified in this Section 5 is not satisfied when and as required to be satisfied, this Agreement may be terminated by the Representative by notice to the Company at any time on or prior to the First Closing Date and, with respect to the Option Shares, at any time prior to the Second Closing Date, which termination shall be without liability on the part of any party to any other party, except that Section 4, Section 6 and Section 7 shall at all times be effective and shall survive such termination.
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(including the reasonable cost of investigation), as incurred, to which the Company, or any such person may become subject, under the Securities Act, the Exchange Act, or other federal or state statutory law or regulation, or at common law or otherwise (including in settlement of any litigation, if such settlement is effected with the written consent of such Underwriter), insofar as such loss, claim, damage, liability or expense (or actions in respect thereof as contemplated below) arises out of or is based upon any untrue or alleged untrue statement of a material fact contained in the Registration Statement, any preliminary prospectus or the Prospectus (or any amendment or supplement thereto), or arises out of or is based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in the Registration Statement, any preliminary prospectus or the Prospectus (or any amendment or supplement thereto), in reliance upon and in conformity with written information furnished to the Company by the Representative expressly for use therein; and to reimburse the Company, or any such controlling person for any legal and other expenses reasonably incurred by the Company, or any such director, officer or controlling person in connection with investigating, defending, settling, compromising or paying any such loss, claim, damage, liability, expense or action. The Company hereby acknowledges that the only information that the Underwriters have furnished to the Company expressly for use in the Registration Statement, any preliminary prospectus or the Prospectus (or any amendment or supplement thereto) are the statements set forth in the fifth, eleventh and twelfth paragraphs under the caption “Underwriting” in the Prospectus. The indemnity agreement set forth in this Section 6(b) shall be in addition to any liabilities that each Underwriter may otherwise have.
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indemnifying party to such indemnified party of such indemnifying party’s election so to assume the defense of such action and approval by the indemnified party of counsel, the indemnifying party will not be liable to such indemnified party under this Section 6 for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof unless (i) the indemnified party shall have employed separate counsel in accordance with the proviso to the next preceding sentence (it being understood, however, that the indemnifying party shall not be liable for the expenses of more than one separate counsel (together with local counsel) representing the indemnified parties who are parties to such action) or (ii) the indemnifying party shall not have employed counsel reasonably satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice of commencement of the action, in each of which cases the reasonable fees and expenses of counsel shall be at the expense of the indemnifying party.
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material fact or omission or alleged omission to state a material fact or any such inaccurate or alleged inaccurate representation or warranty relates to information supplied by the Company, on the one hand, or the Underwriters, on the other hand, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include, subject to the limitations set forth in Section 6(c), any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim. The provisions set forth in Section 6(c) with respect to notice of commencement of any action shall apply if a claim for contribution is to be made under this Section 7; provided, however, that no additional notice shall be required with respect to any action for which notice has been given under Section 6(c) for purposes of indemnification.
The Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in this Section 7.
Notwithstanding the provisions of this Section 7, no Underwriter shall be required to contribute any amount in excess of the underwriting discount and commissions received by such Underwriter in connection with the Shares underwritten by it and distributed to the public. 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, and not joint, in proportion to their respective underwriting commitments as set forth opposite their names in Schedule A. For purposes of this Section 7, each officer, director, employee, partner, member, agent or representative of an Underwriter and each person, if any, who controls an Underwriter within the meaning of the Securities Act and the Exchange Act shall have the same rights to contribution as such Underwriter, and each trustee of the Company, each officer of the Company who signed the Registration Statement, each agent or representative and each person, if any, who controls the Company within the meaning of the Securities Act and the Exchange Act shall have the same rights to contribution as the Company.
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If, on the First Closing Date or the Second Closing Date, as the case may be, any one or more of the Underwriters shall fail or refuse to purchase Shares and the aggregate number of Shares with respect to which such default occurs exceeds 10% of the aggregate number of Shares to be purchased on such date, and arrangements satisfactory to the Representative and the Company for the purchase of such Shares are not made within two business days after such default, this Agreement shall terminate without liability on the part of any non-defaulting Underwriter, except that the provisions of Section 4, Section 6 and Section 7 shall at all times be effective and shall survive such termination. In any such case, either the Representative or the Company shall have the right to postpone the First Closing Date or the Second Closing Date, as the case may be, but in no event for longer than seven business days in order that the required changes, if any, to the Registration Statement and the Prospectus or any other documents or arrangements may be effected.
As used in this Agreement, the term “Underwriter” shall be deemed to include any person substituted for a defaulting Underwriter under this Section 8. Any action taken under this Section 8 shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.
26
or directors or any controlling person, as the case may be, and will survive delivery of and payment for the Shares sold hereunder and any termination of this Agreement.
If to the Representative:
McDonald Investments Inc.
XxXxxxxx Investment Center
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx Xxxxx
with a copy to:
Xxxxxx, Halter & Xxxxxxxx LLP
1400 XxXxxxxx Investment Center
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx X. Xxxxxxx
If to the Company:
First Potomac Realty Trust
0000 Xxxxxxxxx Xxxxxx Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxxxx
with a copy to:
Hunton & Xxxxxxxx LLP
Riverfront Plaza, East Tower
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxx X. Xxxxxx
Any party hereto may change the address for receipt of communications by giving written notice to the others.
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SECTION 14. GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Maryland applicable to agreements made and to be performed in such state.
Each of the parties hereto acknowledges that it is a sophisticated business person who was adequately represented by counsel during negotiations regarding the provisions hereof, including, without limitation, the indemnification provisions of Section 6 and the contribution provisions of Section 7, and is fully informed regarding said provisions. Each of the parties hereto further acknowledges that the provisions of Section 6 and 7 hereto fairly allocate the risks in light of the ability of the parties to investigate the Company, its affairs and its business in order to assure that adequate disclosure has been made in the Registration Statement, any preliminary prospectus and the Prospectus (and any amendments and supplements thereto), as required by the Securities Act and the Exchange Act.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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If the foregoing is in accordance with your understanding of our agreement, kindly sign and return to the Company the enclosed copies hereof, whereupon this instrument, along with all counterparts hereof, shall become a binding agreement in accordance with its terms.
Very truly yours, First Potomac Realty Trust |
||||
By: | /s/ Xxxxx X. Xxxx | |||
Name: | Xxxxx X. Xxxx | |||
Title: | Chief Financial Officer | |||
First Potomac Realty Investment Limited Partnership |
||||
By: | First Potomac Realty Trust, Its | |||
General Partner | ||||
By: | /s/ Xxxxx X. Xxxx | |||
Name: | Xxxxx X. Xxxx | |||
Title: | Chief Financial Officer | |||
The foregoing Underwriting Agreement is hereby confirmed and accepted by the Underwriters as of the date first above written.
KeyBanc Capital Markets,
a division of McDonald Investments Inc.
Xxxxxxx Xxxxx & Associates, Inc.
Xxxxxx X. Xxxxx & Co. Incorporated
Advest, Inc.
Xxxxxx, Xxxxx Xxxxx, Incorporated
as representatives of the Underwriters
By: | McDonald Investments Inc. | |||
By: | /s/ Xxxxxxxx X. Xxxxx | |||
Name: | Xxxxxxxx X. Xxxxx | |||
Title: | Senior Managing Director | |||
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SCHEDULE A
Number of Firm | ||||
Shares to be | ||||
Underwriters |
Purchased |
|||
KeyBanc
Capital Markets, a division of McDonald Investments Inc. |
2,116,800 | |||
Xxxxxxx Xxxxx & Associates, Inc. |
1,176,000 | |||
Xxxxxx X. Xxxxx & Co. Incorporated |
705,600 | |||
Advest, Inc. |
352,800 | |||
Xxxxxx, Xxxxx Xxxxx, Incorporated |
352,800 | |||
J.J.B. Xxxxxxxx, X.X. Xxxxx, Inc. |
96,000 | |||
Total |
4,800,000 | |||
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SCHEDULE B
LOCK-UP AGREEMENTS
Xxxxxxx Xxxxxxxxx
Xxxxx X. Xxxxxxxxx
Xxxxxx X. Xxxxxx
Xxxxxxx X. Chess
R. Xxxxxxx XxXxxxxxxx
Xxxxx X. Xxxxxxx
J. Xxxxxxxx Xxxxxx, III
Xxxxxxxx X. Xxxxx
Xxxxx X. Xxxx
Xxxxx X. Xxxxxx
Xxxxx Xxxx
Xxxxxxx Xxxxx
Plaza 500 Limited Partnership
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EXHIBIT A
FORM OF OPINION OF HUNTON & XXXXXXXX LLP
[The final opinion in draft form will be attached as Exhibit A at the time this Agreement is executed.]
Opinion of counsel for the Company to be delivered pursuant to Section 5(f) of this Agreement. References to the Prospectus in this Exhibit A include any amendments or supplements thereto at the First Closing Date, or Second Closing Date, as the case may be.
(i) 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.
(ii) The Operating Partnership has the limited partnership power and authority to own, lease and operate its properties and to conduct its business as described in the Prospectus and to enter into and perform its obligations under this Agreement.
(iii) This Agreement has been duly authorized, executed and delivered by the Operating Partnership and constitutes the valid and binding agreement of the Operating Partnership enforceable against the Operating Partnership in accordance with its terms, except to the extent that the indemnification and contribution provisions set forth in Sections 6 and 7 of this Agreement may be limited by the federal and state securities laws and public policy considerations in respect thereof, and except as enforceability may be limited by bankruptcy, reorganization, moratorium or similar laws affecting enforceability of creditors’ rights generally.
(iv) Each Subsidiary described on Exhibit A to the opinion has been duly organized and is validly existing as a corporation, limited partnership or limited liability company, as the case may be, in good standing under the laws of the jurisdiction of its incorporation or organization and has corporate, limited partnership or limited liability company power, as the case may be, and authority to own, lease and operate its properties and to conduct its business as described in the Prospectus.
(v) Each of the Company and the Subsidiaries is duly qualified as a foreign corporation, limited partnership or limited liability company, as the case may be, to transact business and is in good standing in the jurisdictions set forth opposite the names of such entities in Annex A hereto.
(vi) The form of certificate used to evidence the Shares is in due and proper form and complies with all applicable requirements of the NYSE.
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(vii) The Shares have been approved for listing on the NYSE, subject only to official notification of issuance.
(viii) Each of the Registration Statement and the Rule 462(b) Registration Statement, if any, has been declared effective by the Commission under the Securities Act. To the knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement has been issued under the Securities Act and no proceedings for such purpose have been instituted or are pending or are contemplated or threatened by the Commission. Any required filing of the Prospectus and any supplement thereto pursuant to Rule 424(b) under the Securities Act has been made in the manner and within the time period required by such Rule 424(b).
(ix) The Registration Statement, the Prospectus, and each amendment or supplement to the Registration Statement and the Prospectus, as of their respective effective or issue dates (other than the financial statements and any supporting schedules or other financial and statistical information included therein or required to be included therein, as to which no opinion need be rendered) comply as to form in all material respects with the applicable requirements of the Securities Act.
(x) The statements in the Prospectus under the captions “Partnership Agreement” and “Federal Income Tax Considerations,” insofar as such statements constitute matters of law, summaries of legal matters, documents or proceedings, or legal conclusions, have been reviewed by such counsel and fairly present, in all material respects, the matters referred to therein.
(xi) To the knowledge of such counsel, there are no legal or governmental actions, suits or proceedings pending or threatened which are required to be disclosed in the Registration Statement, that are not disclosed therein.
(xii) No consent, approval, authorization or other order of, or registration or filing with, any court or other governmental or regulatory authority or agency, is required for the Company’s or the Operating Partnership’s execution, delivery and performance of this Agreement and consummation of the transactions contemplated hereby and by the Prospectus, except as required under the Securities Act and applicable state securities or blue sky laws and from the NASD.
(xiii) The execution and delivery of this Agreement by the Company and the Operating Partnership, the performance by the Company and the Operating Partnership of their obligations hereunder and the consummation of the transactions contemplated hereby (including the issuance and sale of the Shares and the use of proceeds of the Shares as described in the Prospectus under the caption “Use of Proceeds”) will not (A) conflict with or constitute a breach of, or a Default or Debt Repayment Triggering Event under, or result in the creation or
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imposition of any lien, charge or encumbrance upon any property or assets of the Company or any of the Subsidiaries pursuant to, or require the consent of any other party to, any Existing Instrument known to such counsel, (B) conflict with any provisions of the Certificate of Limited Partnership or Partnership Agreement of the Operating Partnership or the applicable organizational documents of any of the Subsidiaries or (C) to such counsel’s knowledge, result in any violation of any law, administrative regulation or administrative or court decree applicable to the Company or any of the Subsidiaries.
(xiv) The Company is not, and after receipt of payment for the Shares will not be, an “investment company” within the meaning of the Investment Company Act.
(xv) Except as disclosed in the Prospectus, to the knowledge of such counsel, there are no persons with registration or other similar rights to have any equity or debt securities registered for sale under the Registration Statement or included in the offering contemplated by the Underwriting Agreement, except for such rights as have been duly satisfied or waived.
(xvi) The Company qualified to be taxed as a REIT pursuant to sections 856 through 860 of the Code for its short taxable year ended December 31, 2003, and the Company’s organization and current and proposed method of operation will enable it to continue to qualify as a REIT for its taxable year ending December 31, 2004, and in the future.
In addition, such counsel shall state that they have participated in conferences with officers and other representatives of the Company, representatives of the independent public or certified public accountants for the Company and with representatives of the Underwriters at which the contents of the Registration Statement and the Prospectus, and any supplements or amendments thereto, and related matters were discussed and, although such counsel is not passing upon and does not assume any responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement or the Prospectus (other than as specified above), and any supplements or amendments thereto, on the basis of the foregoing, nothing has come to the attention of such counsel which would lead them to believe that either the Registration Statement or any amendments thereto, at the time the Registration Statement or such amendments became effective under the Securities Act, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that the Prospectus, as of its date or at the First Closing Date or the Second Closing Date, as the case may be, contained or contains an untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading (it being understood that such counsel need express no belief as to the financial statements or schedules or other financial and statistical data included or required to be included in the Registration Statement or the Prospectus or any amendments or supplements thereto).
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EXHIBIT B
FORM OF OPINION OF XXXX XXXXX LLP
[The final opinion in draft form will be attached as Exhibit B at the time this Agreement is executed.]
Opinion of counsel for the Company to be delivered pursuant to Section 5(f) of this Agreement. References to the Prospectus in this Exhibit B include any amendments or supplements thereto at the First Closing Date, or Second Closing Date, as the case may be.
(i) The Company is a real estate investment trust duly formed, validly existing and in good standing under the laws of the State of Maryland.
(ii) The Company has the trust power to own, lease and operate its properties and conduct its business as described in the Prospectus and to execute and perform its obligations under this Agreement.
(iii) All necessary trust action has been taken to authorize the execution, delivery and performance of this Agreement by the Company.
(iv) This Agreement has been duly executed and delivered by the Company and constitutes the valid and legally binding obligations of the Company, enforceable against the Company in accordance with its terms, except as enforcement of those terms may be limited by (A) bankruptcy, insolvency, reorganization, moratorium, and other laws affecting the rights of creditors generally; and (B) the exercise of judicial discretion in accordance with general principles of equity (regardless of whether enforceability is considered in a proceeding in law or equity).
(v) All of the outstanding common shares of beneficial interest of the Company (other than the Shares) have been duly authorized and validly issued, and are fully paid and nonassessable.
(vi) The Shares have been duly authorized and, when issued and delivered against payment of the consideration in accordance with the terms of this Agreement, will be validly issued, fully paid and nonassessable.
(vii) The authorized shares of beneficial interest of the Company and the Shares conform in all material respects to all statements and descriptions contained in the Prospectus.
(viii) There are no preemptive rights to purchase securities of the Company under the Corporations and Associations Article of the Annotated Code of Maryland, as amended, or that arise under the Declaration of Trust or Bylaws, or, except as disclosed in the Prospectus or contemplated by this Agreement, any preemptive rights, rights of first refusal or similar rights to subscribe for or purchase securities of the Company arising under any agreement or other instrument known to us to which the Company is a party.
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(ix) The form of share certificate evidencing the Shares complies with all applicable statutory requirements and with any applicable requirements of the Declaration of Trust and Bylaws of the Company.
(x) The execution and delivery of this Agreement and the performance by the Company of its terms (A) will not conflict with or result in a violation of the Company’s Declaration of Trust or Bylaws; and (B) to our knowledge, will not violate or result in a breach of the provisions of, constitute a default under or result in the creation or imposition of any lien under, any indenture, mortgage, contract, agreement or instrument to which the Company is a party.
(xi) The execution and delivery of this Agreement, the performance by the Company of its terms and the issuance of the Shares will not conflict with, violate or result in the breach of any judgment, order, writ or decree of any court or governmental authority binding on the Company which is of specific application to the Company or its Properties and which is known to us.
(xii) To our knowledge after due inquiry, the execution and delivery of this Agreement, the performance by the Company of its terms and the issuance of the Shares will not violate any provision of any statute, law, rule or regulation applicable to the Company. The execution and delivery of this Agreement, the performance by the Company of its terms and the issuance of the Shares will not violate any provision of the Corporations and Associations Article of the Annotated Code of Maryland applicable to the Company.
(xiii) No consent, approval, authorization, or other action by, or filing with, any governmental authority or agency of the State of Maryland is required to be obtained or made by the Company for the execution and delivery by the Company of this Agreement and the sale and delivery of the Shares by the Company or other performance of its obligations thereunder as contemplated therein.
(xiv) The statements (A) in the Prospectus under the captions “Risk Factors — Risks Related to Our Organization and Structure — Our rights and the rights of our shareholders to take action against our trustees and officers are limited, which could limit your recourse in the event of actions not in your best interests,” “— Our board of trustees may approve the issuance of preferred shares with terms that may discourage a third party from acquiring us,” “— Our board of trustees may change our investment and operational policies and practices without a vote of our common shareholders, which limits your control of our policies and practices,” “— Our declaration of trust contains provisions that make removal of our trustees difficult, which could make it difficult for our shareholders to effect changes in our management,” “— Maryland law may discourage a third party from acquiring us,” “Our Business and Properties — Other Types of Investments and Policies — Conflicts of Interest Policy,” “Management — Governance — Board of Trustees and Committees,” “Description of Shares,” “Certain Provisions of Maryland Law and of our Amended and Restated Declaration of Trust and Amended and Restated Bylaws,” and (B) Item 34 of the Registration Statement, insofar as such statements constitute matters of law, summaries of legal matters, the Declaration of Trust or Bylaw provisions, documents or legal proceedings, or legal conclusions, have been reviewed by such
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counsel and fairly and accurately present and summarize, in all material respects, the matters referred to therein.
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EXHIBIT C
LOCK UP AGREEMENT
KeyBanc Capital Markets,
a
division of McDonald Investments Inc.
XxXxxxxx Investment Center
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
As Representative of the Several Underwriters
Re: First Potomac Realty Trust (the “Company”)
Ladies & Gentlemen:
The undersigned is an owner of record or beneficially of certain common shares of beneficial interest of the Company (“Shares”) or securities convertible into or exchangeable or exercisable for Shares (collectively, “Securities”). The Company proposes to carry out a public offering of Shares (the “Offering”) for which you will act as the representative of the underwriters. The undersigned recognizes that the Offering will be of benefit to the undersigned and will benefit the Company by, among other things, raising additional capital for its operations. The undersigned acknowledges that you and the other underwriters are relying on the representations and agreements of the undersigned contained in this letter agreement (this “Agreement”) in carrying out the Offering and in entering into underwriting arrangements with the Company with respect to the Offering.
In consideration of the foregoing, the undersigned hereby agrees that the undersigned will not (and will cause any spouse or immediate family member of the spouse or the undersigned living in the undersigned’s household and any trustee of any trust that holds Securities for the benefit of the undersigned or such spouse or family member not to), without the prior written consent of McDonald Investments Inc. (which consent may be withheld in their sole discretion), directly or indirectly, sell, offer, contract or grant any option to sell (including without limitation any short sale), loan, pledge, transfer, establish an open “put equivalent position” within the meaning of Rule 16a-1(h) under the Securities Exchange Act of 1934, as amended, or otherwise dispose of, or grant any rights with respect to, any Shares, options or warrants to acquire Shares, or Securities currently or hereafter owned either of record or beneficially (as defined in Rules 13d-3 and 16a-l(a) under the Securities Exchange Act of 1934, as amended) by the undersigned (or such spouse or family member), or publicly announce an intention to do any of the foregoing, for a period commencing on the date of the Prospectus with respect to the Offering and continuing through the close of trading on the date 90 days after the date of the Prospectus with respect to the Offering (the “Lock-up Period”). The foregoing restrictions have been expressly agreed to by the undersigned so as to preclude the undersigned (or such spouse, family member or trustee) from engaging in any hedging or other transaction that is designed to or reasonably expected to lead to or result in a disposition of Securities during the Lock-up Period, even if such Securities would be disposed of by someone other than such
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holder. Such prohibited hedging or other transactions would include, without limitation, any short sale (whether or not against the box) or any purchase, sale or grant of any right (including, without limitation, any put or call option) with respect to any Securities or with respect to any security (other than a broad-based market basket or index) that included, relates to or derives any significant part of its value from Securities. The foregoing shall not apply to (1) bona fide gifts by the undersigned, provided that (A) each resulting transferee of Securities executes and delivers to you an agreement satisfactory to you certifying that such transferee is bound by the terms of this Agreement and has been in compliance with the terms hereof since the date first above written as if it had been an original party hereto and (B) to the extent any interest in the Securities is retained by the undersigned (or such spouse or family member), the Securities shall remain subject to the restrictions contained in this Agreement and (2) redemptions by the undersigned of units of limited partnership interest in First Potomac Realty Investment L.P. in accordance with the terms and conditions of the Amended and Restated Agreement of Limited Partnership of First Potomac Realty Investment L.P. dated September 15, 2003, provided that any Shares acquired by the undersigned pursuant to any such redemption shall be subject to the restrictions contained in this Agreement.
The undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent and registrar against the transfer of Securities held by the undersigned or such spouse or family member as described herein except in compliance with this Agreement.
This Agreement is irrevocable and will be binding on the undersigned and the respective successors, heirs, personal representatives, and assigns of the undersigned.
[Signature Page Follows.]
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Dated: | ||||||
Printed Name of Holder | ||||||
By: | ||||||
Signature | ||||||
Printed Name of Person Signing (and | ||||||
indicate capacity of person signing if | ||||||
signing as custodian, trustee, or on | ||||||
behalf of an entity) |
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