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Brandywine Realty TrustPrentiss Properties Trustlast month with the help of Pepper Hamiltoncorporate and securities chairman Michael H. Friedman. Pepper Hamilton has represented Plymouth Meeting-based Brandywine for more than 10 years, handling the company’s public transactions. Friedman said this is certainly the largest transaction he’s handled, and happened to be structured as a merger. “We did need to enlist quite a few people,” Friedman said. “In any transaction of this sprawl there are a variety of disciplines.” The firm enlisted the help of finance, tax, employment, and mergers and acquisitions attorneys to complete the deal that took three months to close from the signing of the agreement. The most difficult challenge, Freidman said, came not from the deal with Prentiss, but from a concurrent deal that Brandywine set up with Prudential Real Estate Advisorsfor the same day. In structuring the deal, Brandywine agreed to spin off to Prudential some of the assets it gained in its merger. The deal with Prentiss was completed on Jan. 5, and on that day Prudential acquired approximately $753 million of Prentiss’ assets. This was “a public acquisition that was coupled with a concurrent, in effect, private disposition of assets,” Friedman said. Michael E. Dillardof Akin Gumpin Dallas represented Prentiss Properties and said that he does not think he has ever seen a deal structured in quite that way. “Brandywine came up with a way to sell off some of the assets of Prentiss that they weren’t looking for,” Dillard said. He said that helped finance a portion of the part-stock/part-cash consideration, allowing the company to leverage less capital up front. Dillard said the employment issues in this merger were easier to handle than a normal merger because there was less overlap between the principals in both companies. Brandywine and Prentiss complemented each other well, he said, because the companies had assets in completely different regions. Brandywine wanted to keep Prentiss principals on to help operate the areas new to the company, Dillard said. According to Friedman, triangular mergers were used in order to have Prentiss and its operating partner function under Brandywine and its operating partner. The agreement used the common technique to merge the public portion of Prentiss into one of Brandywine’s two wholly owned subsidiaries. The operating partner of Prentiss was then merged into Brandywine’s other subsidiary. Dillard said that, as with all real estate investment trusts, the merger was tax-driven. He said two plans existed in case the first plan � one viewed as more tax-beneficial � was not accepted by the IRS. The IRS did accept the first plan, issuing its private letter ruling on Dec. 7, 2005. Other Pepper Hamilton attorneys who participated in the deal included finance partner J. Bradley Boericke, tax partners Joan C. Arnoldand Annette M. Ahlers, and employee benefits partner Andrew J. Rudolph. Details The merger agreement was signed on Oct. 3, 2005, and was approved by the Securities and Exchange Commission and the shareholders of both companies, Friedman said. According to SEC filings, both boards approved the merger unanimously. The combined company will conduct business as Brandywine Realty Trust. Brandywine acquired Prentiss Properties’ assets in Washington, D.C., northern and southern California, and all properties in Austin and Dallas, as well as related land holdings. Brandywine now owns/manages a portfolio of 49 million square feet of space with a total market capitalization of $6 billion. In the spin-off, funds managed by Prudential acquired Prentiss assets in Denver and select assets in northern and southern California, and Washington, D.C. Brandywine now provides management and leasing for the Prudential assets in all regions except Denver. “The boards expect that the combined company will have significantly increased equity market capitalization, which the boards expect will provide greater financial flexibility and liquidity,” according to the proxy statement submitted to the SEC. “The boards of trustees of both companies believe that the combined resources of our companies will create additional and more significant opportunities for long-term growth and value-creation than either company could achieve independently.” According to Pepper Hamilton, the consideration payable by Brandywine in the merger included common shares of beneficial interest, units of limited partnership interest in Brandywine’s operating partnership subsidiary, and cash and debt assumptions. Holders of Prentiss common shares received a combination of cash and Brandywine common shares, and holders of units in the Prentiss operating partnership subsidiary had the right to elect to receive either cash and Brandywine common shares or units of partnership interest in Brandywine’s operating partnership subsidiary, according to Pepper Hamilton. Brandywine shareholders will not receive any compensation from the merger, and their shares will remain the same, according to the proxy statement. According to SEC filings, “[u]pon completion of the REIT merger, each Prentiss common share will be converted into the right to receive $21.50 in cash, subject to reduction by the amount of a special pre-closing cash dividend if the special pre-closing cash dividend is paid as described below, and .69 of a Brandywine common share.” Michael V. Prentiss, chairman of Prentiss Properties, and Thomas F. August, president and chief executive officer of Prentiss Properties, have joined Brandywine’s board of trustees. The combined company’s corporate structure will include several Prentiss Properties executives and Prentiss regional operations will be incorporated into Brandywine’s operating platform. In this transaction, J.P. Morgan Securities Inc.acted as adviser to both Brandywine and Prudential Real Estate Investors while Lazard Freres & Co.served as adviser to Prentiss Properties. Please send any Deal Makers stories to Gina Passarella at [email protected]

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