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Section 1: DEFM14A (DEFM14A)


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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.          )

Filed by the Registrant ý

Filed by a Party other than the Registrant o

Check the appropriate box:

o

 

Preliminary Proxy Statement

o

 

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

ý

 

Definitive Proxy Statement

o

 

Definitive Additional Materials

o

 

Soliciting Material under §240.14a-12

 

Gramercy Property Trust

(Name of Registrant as Specified In Its Charter)

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

o

 

No fee required.

o

 

Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
    (1)   Title of each class of securities to which transaction applies:
 
    (2)   Aggregate number of securities to which transaction applies:
 
    (3)   Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
 
    (4)   Proposed maximum aggregate value of transaction:
 
    (5)   Total fee paid:
 

ý

 

Fee paid previously with preliminary materials.

o

 

Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

 

 

(1)

 

Amount Previously Paid:
 
    (2)   Form, Schedule or Registration Statement No.:
 
    (3)   Filing Party:
 
    (4)   Date Filed:
 

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LOGO

90 Park Avenue, 32nd Floor
New York, New York 10016
June 27, 2018

Dear Shareholder,

        You are cordially invited to attend a special meeting of shareholders of Gramercy Property Trust, a Maryland real estate investment trust, to be held on August 9, 2018 at 9:30 a.m., New York time, at the offices of Wachtell, Lipton, Rosen & Katz, 51 West 52nd Street, New York, New York 10019. At the special meeting, you will be asked to consider and vote on the merger of Gramercy Property Trust with and into BRE Glacier L.P., an affiliate of The Blackstone Group L.P., which we refer to as the merger, and other transactions contemplated by the Agreement and Plan of Merger, dated as of May 6, 2018 and as it may be amended from time to time, among Gramercy Property Trust, GPT Operating Partnership LP and affiliates of The Blackstone Group L.P., which we refer to as the merger agreement. If the merger is completed, you, as a holder of common shares of Gramercy Property Trust, will be entitled to receive $27.50 in cash, plus, if the merger is consummated after October 15, 2018, a per diem amount of approximately $0.004 in cash for each day from and after such date until (but not including) the closing date, without interest and less any applicable withholding taxes, in exchange for each common share you own, as more fully described in the enclosed proxy statement.

        Our board of trustees has unanimously approved the merger agreement and declared the merger agreement and the transactions contemplated by the merger agreement, including the merger, to be advisable and in the best interests of Gramercy Property Trust and our shareholders. Our board of trustees recommends that you vote "FOR" the approval of the merger and the other transactions contemplated by the merger agreement.

        The merger and the other transactions contemplated by the merger agreement must be approved by the affirmative vote of the holders of common shares entitled to cast not less than a majority of all the votes entitled to be cast on the matter. The notice of special meeting and proxy statement accompanying this letter provides you with more specific information concerning the special meeting, the merger, the merger agreement and the other transactions contemplated by the merger agreement. We encourage you to read carefully the enclosed proxy statement, including the exhibits. You may also obtain more information about Gramercy Property Trust from us or from documents we have filed with the U.S. Securities and Exchange Commission.

        Your vote is very important regardless of the number of common shares that you own. Whether or not you plan to attend the special meeting, we request that you authorize a proxy to vote your common shares by either completing and returning the enclosed proxy card as promptly as possible or authorizing your proxy or voting instructions by telephone or through the Internet. The enclosed proxy card contains instructions regarding voting. If you attend the special meeting, you may continue to have your common shares voted as instructed in your proxy, or you may withdraw your proxy at the special meeting and vote your common shares in person. If you fail to vote by proxy or in person, or fail to instruct your broker on how to vote, it will have the same effect as a vote "AGAINST" approval of the merger and the other transactions contemplated by the merger agreement.

        On behalf of the board of trustees, thank you for your continued support.

Sincerely,    

GRAPHIC

 

 

Gordon F. DuGan
Chief Executive Officer

 

 

        This proxy statement is dated June 27, 2018 and is first being mailed to our shareholders on or about June 27, 2018.


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GRAMERCY PROPERTY TRUST
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON AUGUST 9, 2018

To the Shareholders of Gramercy Property Trust:

        You are cordially invited to attend a special meeting of shareholders of Gramercy Property Trust, a Maryland real estate investment trust, to be held on August 9, 2018 at 9:30 a.m., New York time, at the offices of Wachtell, Lipton, Rosen & Katz, 51 West 52nd Street, New York, New York 10019. The special meeting is being held for the purpose of acting on the following matters:

        The foregoing items of business are more fully described in the attached proxy statement, which forms a part of this notice and is incorporated herein by reference. Pursuant to our bylaws, only the matters set forth in this Notice of Special Meeting may be brought before the special meeting. Our board of trustees has fixed the close of business on June 26, 2018 as the record date for the determination of shareholders entitled to notice of and to vote at the special meeting or any postponement or adjournment thereof. All holders of record of our common shares as of the record date are entitled to receive notice of and attend the special meeting or any postponement or adjournment of the special meeting. The vote of the holders of our preferred shares is not required to approve any of the proposals at the special meeting and is not being solicited.

        Our board of trustees has unanimously approved the merger agreement and declared the merger agreement and the transactions contemplated by the merger agreement, including the merger, to be advisable and in the best interests of Gramercy Property Trust and our shareholders. Our board of trustees recommends that you vote "FOR" the proposal to approve the merger and the other transactions contemplated by the merger agreement, "FOR" the proposal to approve, on a non-binding, advisory basis, the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger, and "FOR" the proposal to approve any adjournment of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement.

        The merger and the other transactions contemplated by the merger agreement must be approved by the affirmative vote of the holders of common shares entitled to cast not less than a majority of all the votes entitled to be cast on the matter. Accordingly, your vote is very important regardless of the number of common shares that you own. Whether or not you plan to attend the special meeting, we request that you authorize a proxy to vote your common shares by either marking, signing, dating and promptly returning the enclosed proxy card in the postage-paid envelope or authorizing your proxy or voting instructions by telephone or through the Internet. If you attend the special meeting, you may continue to have your common shares voted as instructed in your proxy, or you may withdraw your proxy at the special meeting and vote your common shares in person. If you fail to vote by proxy or in person, or fail to instruct your broker, bank or other nominee on how to vote, the effect will be that the common shares that you own will not be counted for purposes of determining whether a quorum is


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present at the special meeting and will have the same effect as a vote "AGAINST" the proposal to approve the merger and the other transactions contemplated by the merger agreement.

        The approval of the proposal regarding the non-binding, advisory vote on the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger, and the approval of the proposal regarding any adjournment of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement, each requires the affirmative vote of a majority of the votes cast on the proposal. If you fail to vote by proxy or in person, or fail to instruct your broker on how to vote, it will have no effect on the outcome of such proposals. Abstentions are not considered votes cast and therefore will have no effect on the outcome of these proposals.

        Any proxy may be revoked at any time prior to its exercise by delivery of a properly executed, later-dated proxy card, by authorizing your proxy or voting instructions by telephone or through the Internet at a later date than your previously authorized proxy, by submitting a written revocation of your proxy to our Secretary, or by voting in person at the special meeting. Attendance alone will not be sufficient to revoke a previously authorized proxy.

        Holders of our common shares may not exercise any appraisal rights, dissenters' rights or the rights of an objecting shareholder to receive the fair value of the shareholder's common shares in connection with the merger because, as permitted by the Maryland REIT Law, as amended (which we refer to as the Maryland REIT Law), our declaration of trust provides that shareholders are not entitled to exercise such rights unless our board of trustees, upon the affirmative vote of a majority of the entire board, determines that the rights apply. Our board of trustees has made no such determination.

        We encourage you to read the accompanying proxy statement in its entirety and to submit a proxy or voting instructions so that your common shares will be represented and voted even if you do not attend the special meeting. If you have any questions or need assistance in submitting a proxy or your voting instructions, please call our proxy solicitor, Morrow Sodali LLC, toll-free at 1-800-662-5200.

  BY ORDER OF THE BOARD OF TRUSTEES

 

 

SIG

 

Edward J. Matey Jr.
Secretary

New York, New York
June 27, 2018


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TABLE OF CONTENTS

 
  Page  

SUMMARY

    1  

The Parties to the Mergers

    1  

The Special Meeting

    3  

The Mergers

    4  

Recommendation of Our Board of Trustees

    5  

Opinion of Our Financial Advisor

    5  

Treatment of Common Shares, Preferred Shares and Equity Awards

    6  

Treatment of Interests in the Partnership

    7  

Financing

    8  

Interests of Our Trustees and Executive Officers in the Mergers

    9  

Restriction on Solicitation of Company Acquisition Proposals

    9  

Conditions to the Mergers

    9  

Termination of the Merger Agreement

    10  

Termination Fees

    12  

Guaranty and Remedies

    13  

Regulatory Matters

    14  

No Dissenters' Rights of Appraisal

    14  

Litigation Relating to the Mergers

    14  

Material U.S. Federal Income Tax Consequences

    15  

Delisting and Deregistration of Our Common Shares and Preferred Shares

    15  

Market Price of Our Common Shares

    15  

QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGERS

    16  

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

    24  

PROPOSAL 1: PROPOSAL TO APPROVE THE MERGER

    26  

PROPOSAL 2: PROPOSAL TO APPROVE THE MERGER-RELATED COMPENSATION

    27  

PROPOSAL 3: PROPOSAL TO APPROVE ADJOURNMENT OF THE MEETING

    28  

THE PARTIES TO THE MERGERS

    29  

Gramercy Property Trust

    29  

GPT Operating Partnership LP

    29  

BRE Glacier Parent L.P. 

    29  

BRE Glacier L.P. 

    30  

BRE Glacier Acquisition L.P. 

    30  

THE SPECIAL MEETING

    31  

Date, Time and Purpose of the Special Meeting

    31  

Record Date, Notice and Quorum

    31  

Required Vote

    31  

How to Authorize a Proxy

    32  

Proxies and Revocation

    33  

Solicitation of Proxies

    34  

Adjournments

    34  

Postponements

    34  

THE MERGERS

    35  

General Description of the Mergers

    35  

Background of the Mergers

    35  

Reasons for the Mergers

    44  

Recommendation of Our Board of Trustees

    47  

Forward-Looking Financial Information

    48  

Opinion of Our Financial Advisor

    54  

Financing

    62  

Interests of Our Trustees and Executive Officers in the Mergers

    63  

Regulatory Matters

    69  

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  Page  

Litigation Relating to the Mergers

    70  

Material U.S. Federal Income Tax Consequences

    70  

Consequences of the Merger to U.S. Holders of our Common Shares

    72  

Consequences of the Merger to Non-U.S. Holders of our Common Shares

    72  

Consequences of the Merger to Holders of our Preferred Shares

    74  

Information Reporting and Backup Withholding

    74  

Delisting and Deregistration of Our Common Shares and Preferred Shares

    74  

THE MERGER AGREEMENT

    75  

Structure

    75  

Effective Times; Closing Date

    76  

Organizational Documents

    76  

Officers; General Partner and Limited Partners

    77  

Treatment of Common Shares, Preferred Shares and Equity Awards

    77  

Treatment of Interests in the Partnership

    78  

No Further Ownership Rights

    80  

Exchange and Payment Procedures

    81  

Representations and Warranties

    82  

Conduct of Our Business Pending the Mergers

    86  

Shareholders' Meeting

    90  

Agreement to Take Certain Actions

    91  

Restriction on Solicitation of Company Acquisition Proposals

    92  

Obligation of the Board of Trustees with Respect to Its Recommendation

    94  

Employee Benefits

    96  

Financing Cooperation

    97  

Pre-Closing Transactions

    99  

Certain Other Covenants

    100  

Conditions to the Mergers

    101  

Termination of the Merger Agreement

    102  

Termination Fees

    104  

Guaranty and Remedies

    105  

Amendment and Waiver

    106  

MARKET PRICE OF OUR COMMON SHARES

    107  

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

    108  

NO DISSENTERS' RIGHTS OF APPRAISAL

    110  

SHAREHOLDER PROPOSALS

    110  

HOUSEHOLDING OF PROXY MATERIALS

    110  

OTHER MATTERS

    111  

WHERE YOU CAN FIND MORE INFORMATION

    111  

EXHIBITS

       

Exhibit A—Agreement and Plan of Merger, dated as of May 6, 2018, by and among Gramercy Property Trust,  GPT Operating Partnership LP, BRE Glacier Parent L.P., BRE Glacier L.P. and BRE Glacier Acquisition L.P. 

    A-1  

Exhibit B—Opinion of Morgan Stanley & Co. LLC, dated May 6, 2018.

    B-1  

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SUMMARY

        This summary highlights only selected information from this proxy statement relating to (1) the merger of Gramercy Property Trust with and into BRE Glacier L.P., (2) the merger of BRE Glacier Acquisition L.P. with and into GPT Operating Partnership LP, which we refer to as the partnership merger, and (3) certain related transactions. References to the mergers refer to both the merger and the partnership merger. This summary does not contain all of the information about the mergers and related transactions contemplated by the merger agreement that may be important to you. As a result, to understand the mergers and the related transactions fully and for a more complete description of the terms of the mergers and related transactions, you should read carefully this proxy statement in its entirely, including the exhibits and the other documents to which we have referred you, including the merger agreement attached as Exhibit A. Each item in this summary includes a page reference directing you to a more complete description of that item. This proxy statement is first being mailed to our shareholders on or about June 27, 2018.

The Parties to the Mergers (page 29)

Gramercy Property Trust
90 Park Avenue, 32nd Floor
New York, New York 10016
(212) 297-1000

        Gramercy Property Trust, which we refer to as "we," "our," "us," or "the Company," was formed as a Maryland real estate investment trust in March 2004 and elected to be taxed as a real estate investment trust, or REIT, under the Internal Revenue Code of 1986, as amended, or the Code, beginning with the taxable year ended December 31, 2004. We are a leading global investor and asset manager of commercial real estate. The Company specializes in acquiring and managing high quality, income producing industrial commercial real estate leased to high quality tenants in major markets in the United States and Europe. The Company's website is www.gptreit.com. The information found on, or otherwise accessible through, our website is not incorporated into, and does not form a part of, this proxy statement or any other report or document we file with or furnish to the SEC. Our common shares are listed on the NYSE under the symbol "GPT." For additional information about us and our business, please refer to "Where You Can Find More Information."

GPT Operating Partnership LP
90 Park Avenue, 32nd Floor
New York, New York 10016
(212) 297-1000

        GPT Operating Partnership LP, which we refer to as the Partnership, was formed as a Delaware limited partnership in March 2004. The Partnership indirectly owns (i) all of our consolidated real estate investments, (ii) our interests in unconsolidated investments, and (iii) the entities that conduct our third-party asset management operations. We are the sole general partner of the Partnership. As of June 26, 2018, third-party holders of limited partnership interests (including holders of Company LTIP units that will be converted, prior to the partnership merger effective time, into Class A partnership units as described below) owned approximately 4.24% of the Partnership.

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BRE Glacier Parent L.P.
c/o The Blackstone Group
345 Park Avenue
New York, New York 10154
(212) 583-5000

        BRE Glacier Parent L.P., which we refer to as Parent, is a Delaware limited partnership and an affiliate of Blackstone Real Estate Partners VIII L.P. We refer to Blackstone Real Estate Partners VIII L.P. as the Sponsor. Parent was formed solely for the purpose of acquiring us and has not carried on any activities to date, except for activities incidental to its formation and activities undertaken in connection with the transactions contemplated by the merger agreement. The Sponsor is an affiliate of The Blackstone Group L.P., which we refer to as Blackstone.

        Blackstone is a global leader in real estate investing. Blackstone's real estate business was founded in 1991 and has approximately $120 billion in investor capital under management. Blackstone's real estate portfolio includes hotel, office, retail, industrial and residential properties in the US, Europe, Asia and Latin America. Major holdings include Hilton Worldwide, Invitation Homes (single family homes), Logicor (pan-European logistics) and prime office buildings in the world's major cities. Blackstone real estate also operates one of the leading real estate finance platforms, including management of the publicly traded Blackstone Mortgage Trust.

BRE Glacier L.P.
c/o The Blackstone Group
345 Park Avenue
New York, New York 10154
(212) 583-5000

        BRE Glacier L.P., which we refer to as Merger Sub I, is a Delaware limited partnership. BRE Glacier LLC, a Delaware limited liability company, is the sole general partner of Merger Sub I. Merger Sub I was formed solely for purposes of facilitating Parent's acquisition of us and has not carried on any activities to date, except for activities incidental to its formation and activities undertaken in connection with the transactions contemplated by the merger agreement. Pursuant to the merger agreement, on the closing date, we will merge with and into Merger Sub I, and Merger Sub I will continue as the surviving entity.

BRE Glacier Acquisition L.P.
c/o The Blackstone Group
345 Park Avenue
New York, New York 10154
(212) 583-5000

        BRE Glacier Acquisition L.P., which we refer to as Merger Sub II, is a Delaware limited partnership. BRE Glacier Acquisition LLC, a Delaware limited liability company, is the sole general partner of Merger Sub II. Merger Sub II was formed solely for purposes of facilitating Parent's acquisition of us and has not carried on any activities to date, except for activities incidental to its formation and activities undertaken in connection with the transactions contemplated by the merger agreement. Pursuant to the merger agreement, on the closing date, Merger Sub II will merge with and into the Partnership, and the Partnership will continue as the surviving partnership.

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The Special Meeting (page 31)

The Proposals

        The special meeting of our shareholders will be held on August 9, 2018 at 9:30 a.m., New York time, at the offices of Wachtell, Lipton, Rosen & Katz, 51 West 52nd Street, New York, New York 10019. At the special meeting, holders of our common shares, par value $0.01 per share, which we refer to as common shares, as of the record date, which was the close of business on June 26, 2018, will be asked to consider and vote on (1) a proposal to approve the merger and the other transactions contemplated by the merger agreement, (2) a proposal to approve, on a non-binding, advisory basis, the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger and (3) a proposal to approve any adjournment of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement.

        Pursuant to our bylaws, only the matters set forth in the Notice of Special Meeting may be brought before the special meeting.

Record Date, Notice and Quorum

        All holders of record of our common shares as of the record date, which was the close of business on June 26, 2018, are entitled to receive notice of and attend and vote at the special meeting or any postponement or adjournment of the special meeting. Each common shareholder will be entitled to cast one vote on each matter presented at the special meeting for each common share that such holder owned as of the record date. On the record date, there were 160,792,820 common shares outstanding and entitled to vote at the special meeting.

        The presence in person or by proxy of our common shareholders entitled to cast a majority of all the votes entitled to be cast at the special meeting will constitute a quorum for purposes of the special meeting. A quorum is necessary to transact business at the special meeting. Abstentions will be counted as shares present for the purposes of determining the presence of a quorum. If a quorum is not present at the special meeting, we expect that the special meeting will be adjourned to a later date. Pursuant to our bylaws, the chairman of the meeting may adjourn the meeting, whether or not a quorum is present, to a later date, time and place announced at the special meeting.

Required Vote

        Completion of the mergers requires approval of the merger and the other transactions contemplated by the merger agreement by the affirmative vote of the holders of common shares entitled to cast not less than a majority of all the votes entitled to be cast on the matter. Each common shareholder is entitled to cast one vote on each matter presented at the special meeting for each common share owned by such shareholder on the record date. Because the required vote for this proposal is based on the number of votes our common shareholders are entitled to cast rather than on the number of votes cast, if you fail to vote by proxy or in person (including by abstaining), or fail to instruct your broker on how to vote, such failure will have the same effect as voting against the proposal to approve the merger and the other transactions contemplated by the merger agreement.

        The approval of the proposal regarding the non-binding, advisory vote on the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger, and the approval of the proposal regarding any adjournment of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement, each requires the affirmative vote of a majority of the votes cast on the proposal. Approval of these proposals is not a condition to completion of the mergers. For the purpose of each of these proposals, if you fail to

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vote by proxy or in person, or fail to instruct your broker on how to vote, it will not have any effect on the outcome of such proposals. Abstentions are not considered votes cast and therefore will have no effect on the outcome of these proposals.

        The vote of the holders of our 7.125% Series A Cumulative Redeemable Preferred Shares, par value $0.01 per share, which we refer to as preferred shares, is not required to approve any of the proposals at the special meeting and is not being solicited.

        As of the record date, our trustees and executive officers owned and are entitled to vote an aggregate of approximately 1,080,321 of our common shares, entitling them to exercise approximately 0.67% of the voting power of our common shares entitled to vote at the special meeting. Our trustees and executive officers have informed us that they intend to vote the common shares that they own in favor of the proposal to approve the merger and the other transactions contemplated by the merger agreement, in favor of the proposal regarding the non-binding, advisory vote on the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger and in favor of the proposal to approve any adjournment of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement, although they have no obligation to do so.

Proxies; Revocation

        Any of our common shareholders of record entitled to vote may authorize a proxy to vote his, her or its common shares by returning the enclosed proxy card, authorizing a proxy or voting instructions by telephone or through the Internet, or by appearing and voting at the special meeting in person. If the common shares that you own are held in "street name" by your broker, you should instruct your broker on how to vote your common shares using the instructions provided by your broker.

        Any proxy may be revoked at any time prior to its exercise by your delivery of a properly executed, later-dated proxy card, by authorizing your proxy by telephone or through the Internet at a later date than your previously authorized proxy, by your filing a written revocation of your proxy with our Secretary or by your voting in person at the special meeting. Attendance alone will not be sufficient to revoke a previously authorized proxy.

The Mergers (page 35)

        Pursuant to the merger agreement, on the closing date, Merger Sub II will merge with and into the Partnership and the separate existence of Merger Sub II will cease, and the Partnership will be the surviving partnership in the partnership merger. We use the term Surviving Partnership in this proxy statement to refer to the Partnership following the partnership merger effective time.

        The partnership merger will become effective upon the filing of a certificate of merger with respect to the partnership merger with the Secretary of State of the State of Delaware or on such other date and time as may be mutually agreed to by us and Parent and specified in the partnership merger certificate. We use the term partnership merger effective time in this proxy statement to refer to the time the partnership merger becomes effective.

        Also on the closing date, we will merge with and into Merger Sub I and the separate existence of the Company will cease, and Merger Sub I will continue as the surviving entity in the merger. We use the term Surviving Company in this proxy statement to refer to Merger Sub I following the effective time of the merger.

        Our merger with Merger Sub I will become effective upon the later of the acceptance for record of the articles of merger with respect to the merger by the State Department of Assessments and Taxation of Maryland, the filing of the certificate of merger with respect to the merger with the

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Secretary of State of the State of Delaware or on such other date and time as may be mutually agreed to by us and Parent and specified in the articles of merger and certificate of merger. We use the term merger effective time in this proxy statement to refer to the time the merger becomes effective. Unless otherwise agreed by the parties to the merger agreement, the partnership merger effective time and the merger effective time will occur on the closing date, with the merger effective time occurring immediately after the partnership merger effective time.

Recommendation of Our Board of Trustees (page 47)

        Our board of trustees has unanimously:

Opinion of Our Financial Advisor (page 54)

Opinion of Morgan Stanley & Co. LLC

        At the May 6, 2018 meeting of our board of trustees, Morgan Stanley & Co. LLC, which we refer to as Morgan Stanley, rendered its oral opinion, subsequently confirmed in writing by delivery of a written opinion to our board of trustees dated May 6, 2018, that, as of that date and based upon and subject to the various assumptions made, procedures followed, matters considered and qualifications and limitations on the scope of review undertaken by Morgan Stanley as set forth in the written opinion, the merger consideration to be received by the holders of our common shares pursuant to the merger agreement was fair from a financial point of view to such holders of our common shares.

        The full text of the written opinion of Morgan Stanley, dated as of May 6, 2018, is attached to this proxy statement as Exhibit B and is hereby incorporated into this proxy statement by reference in its entirety. You should read the opinion in its entirety for a discussion of the assumptions made, procedures followed, matters considered and qualifications and limitations on the scope of the review undertaken by Morgan Stanley in rendering its opinion. We encourage you to read the entire opinion and the summary of Morgan Stanley's opinion below carefully and in their entirety. This summary of the opinion of Morgan Stanley set forth in this proxy statement is qualified in its entirety by reference to the full text of the opinion. Morgan Stanley's opinion is directed to our board of trustees, in its capacity as such, addresses only the fairness of the merger consideration to be received by the holders of our common shares pursuant to the merger agreement from a financial point of view to such holders as of the date of the opinion and does not address any other aspects or implications of the mergers. Morgan Stanley's opinion was not intended to, and does not, constitute a recommendation to any holder of our common shares as to how to vote at the special meeting to be held in connection with the mergers or whether to take any other action with respect to the mergers. Morgan Stanley was not requested to opine as to, and its opinion did not in any manner address the relative merits of, the transactions contemplated by the merger agreement as compared to other business or financial strategies that might be available to the Company, nor did it address the underlying business decision

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of the Company to enter into the merger agreement or proceed with any other transaction contemplated by the merger agreement.

Treatment of Common Shares, Preferred Shares and Equity Awards (page 77)

Common Shares

        The merger agreement provides that, at the merger effective time, each of our common shares (other than (1) any of our common shares owned by Parent, Merger Sub I or any subsidiary of Parent, the Company or Merger Sub I immediately prior to the merger effective time (which we refer to as excluded shares), which will automatically be canceled and retired and will cease to exist with no consideration being delivered in exchange therefor, and (2) any of our common shares under a Company restricted share award) issued and outstanding immediately prior to the merger effective time will automatically be converted into the right to receive an amount in cash equal to $27.50 (plus, if the mergers are consummated after October 15, 2018, a per diem amount of approximately $0.004 in cash for each day from and after such date until (but not including) the closing date), without interest (we refer to such amount as the merger consideration). If we declare a distribution reasonably necessary to maintain our status as a REIT under the Code or to avoid the payment of income or excise tax under the Code as permitted under the merger agreement, the merger consideration will be decreased by an amount equal to the per share amount of such distribution.

Preferred Shares

        Pursuant to the terms of the merger agreement, promptly following Parent's request after the date this proxy statement is mailed to our shareholders, we will deliver to the holders of record of our preferred shares a notice of redemption contemplated by the articles supplementary classifying and designating our preferred shares (which we refer to as the Series A Articles Supplementary). The redemption notice will be prepared by us, in form and substance reasonably satisfactory to Parent, and will state that each of our preferred shares held by such holder immediately prior to the merger effective time will be redeemed by us effective as of the closing date through the payment of an amount in cash equal to $25.00 per share plus accrued and unpaid dividends (whether or not authorized or declared) to, but not including, the closing date (including any additional amounts contemplated by the Series A Articles Supplementary), without interest (we refer to such amount as the per preferred share redemption price, and we refer to the aggregate amount payable to such holders in such redemption as the aggregate per preferred share redemption amount). Such redemption will be subject to and conditioned upon the occurrence of the closing of the mergers. Prior to the merger effective time, Parent will deposit or cause to be deposited with the paying agent funds sufficient to pay the aggregate per preferred share redemption amount.

Restricted Share Awards

        Immediately prior to the merger effective time, each award of restricted common shares granted under a Company equity plan that is outstanding immediately prior to the merger effective time (we refer to each as a Company restricted share award) will be cancelled in exchange for a cash payment in an amount equal to (1) the number of common shares subject to the Company restricted share award immediately prior to the merger effective time multiplied by (2) the merger consideration, less any applicable withholding taxes.

Restricted Share Unit Awards

        Immediately prior to the merger effective time, each restricted share unit award (we refer to each as a Company RSU award) covering common shares granted under a Company equity plan that is outstanding immediately prior to the merger effective time will be cancelled in exchange for a cash

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payment in an amount equal to (1) the number of common shares subject to the Company RSU award immediately prior to the merger effective time multiplied by (2) the merger consideration, less any applicable withholding taxes.

Company Options

        Immediately prior to the merger effective time, each option to purchase common shares (we refer to each as a Company option) that is outstanding immediately prior to the merger effective time will be cancelled in exchange for a cash payment in an amount equal to (1) the number of common shares subject to the Company option immediately prior to the merger effective time multiplied by (2) the excess (if any) of the merger consideration over the per share exercise price applicable to the Company option, less any applicable withholding taxes.

Company LTIP Units

        Each unvested Company LTIP unit that is outstanding on the business day prior to the partnership merger effective time will vest, without proration, pursuant to its terms on the business day prior to the closing date, and, with respect to the maximum number of vested Company LTIP units then eligible for conversion under the terms of the partnership agreement, we will exercise our right to convert each such vested Company LTIP unit (including those that vest on the business day prior to the closing date) into a Class A partnership unit immediately prior to the time at which the partnership merger becomes effective and be treated as a Class A partnership unit as described below.

Treatment of Interests in the Partnership (page 78)

        In connection with the partnership merger, each Class A unit of the Partnership (including each Company LTIP unit that will be converted, prior to the partnership merger effective time, into a Class A partnership unit as described above), which we refer to as a Class A partnership unit, issued and outstanding immediately prior to the partnership merger effective time (other than (1) Class A partnership units owned by the Company or any wholly owned subsidiary of the Company, which Class A partnership units will be unaffected by the partnership merger and will remain outstanding as partnership units of the Surviving Partnership held by the Company, and (2) Class A partnership units owned by Parent, Merger Sub II or any of their respective wholly owned subsidiaries, which will automatically be canceled and will cease to exist with no consideration being delivered in exchange therefor) will automatically be converted into, and canceled in exchange for, the right to receive the merger consideration. As discussed above, if we declare a distribution reasonably necessary to maintain our status as a REIT under the Code, or to avoid the payment of income or excise tax as permitted under the merger agreement, the merger consideration will be decreased by an amount equal to the per share amount of such distribution. We refer to each holder of Class A partnership units (including Company LTIP units that will be converted, prior to the partnership merger effective time, into Class A partnership units) (other than the Company, any wholly owned subsidiary of the Company, Parent, Merger Sub I, Merger Sub II or any wholly owned subsidiary of the Surviving Company, Parent or Merger Sub II), as a minority limited partner.

        Alternatively, in lieu of the merger consideration, each minority limited partner that is an "accredited investor" as defined under the U.S. securities laws and is not a "benefit plan investor" within the meaning of the Employment Retirement Income Security Act of 1974, as amended, which we refer to as ERISA, and that has satisfied certain other requirements will be afforded the opportunity to elect to convert all or a portion of such minority limited partner's Class A partnership units (including Company LTIP units that will be converted, prior to the partnership merger effective time, into Class A partnership units as described above) into 5.75% Series B cumulative preferred units of the Surviving Partnership, which we refer to as Series B preferred units, on a one-for-one basis, without interest. Separate materials will be sent to the minority limited partners regarding this election.

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This proxy statement does not constitute any solicitation of consents in respect of the partnership merger, and does not constitute an offer to exchange or convert the Class A partnership units (including the Company LTIP units that will be converted, prior to the partnership merger effective time, into Class A partnership units as described above) that you may own for or into Series B preferred units in the Surviving Partnership.

Financing (page 62)

        In connection with the closing of the mergers, Parent will cause an aggregate of approximately $4.6 billion to be paid to the holders of our common shares, including holders of Company equity awards, and the minority limited partners (assuming none of the minority limited partners elects to receive Series B preferred units in the Surviving Partnership). In connection with the redemption of our preferred shares as described under "The Merger Agreement—Treatment of Common Shares, Preferred Shares and Equity Awards," Parent will cause approximately $88 million (plus accrued and unpaid dividends to, but not including, the redemption date) to be paid to the holders of our preferred shares. In addition, Parent has informed us that in connection with the closing of the mergers, Parent expects to cause all of our outstanding unsecured senior notes and term loans and all of outstanding indebtedness under our revolving credit facility to be prepaid in full at the closing. Parent has informed us that it expects our mortgage loans to be repaid or remain outstanding. As of March 31, 2018, we had approximately $2.2 billion in aggregate principal amount of consolidated indebtedness under our unsecured senior notes, term loans and revolving credit facility and $551 million in aggregate principal amount of consolidated indebtedness under our mortgage loans. As of March 31, 2018, our share of unconsolidated joint venture secured debt was approximately $127 million.

        Parent has informed us that it has received a debt commitment letter from Citigroup Global Markets Inc. and Bank of America, N.A. providing for debt financing in connection with the mergers in an aggregate amount not to exceed $3.0 billion and that it may seek to obtain additional debt financing in connection with the mergers. In addition, it is expected that the Sponsor and its affiliates will contribute equity to Parent for the purpose of funding the acquisition costs (including the merger consideration) that are not covered by such debt financing.

        Parent has informed us that in addition to the payment of the merger consideration, the funds to be obtained from the debt and equity financing may be used for purposes such as reserves, the refinancing of certain of our existing debt, and for other costs and expenses related to the financing and the mergers. Parent has informed us that it currently believes that the funds to be borrowed under each debt financing would be secured by, among other things, a first priority mortgage lien on certain properties which are wholly owned by us, escrows, reserves, a cash management account, or a first priority pledge of and security interest in the direct or indirect ownership interests in the owners of the properties, in each case, together with such other pledges and security required by the lender to secure and perfect their interest in the applicable collateral and that such debt financings would be conditioned on the mergers being completed and other customary conditions for similar financings.

        Pursuant to the merger agreement, we have agreed to deliver, promptly following Parent's request, to each of the lenders under our existing mortgage indebtedness a notice prepared by Parent, in form and substance reasonably approved by us, requesting that such lender consent to the consummation of the mergers and the other transactions contemplated by the merger agreement and to certain modifications of the existing loan documents reasonably requested by Parent.

        The merger agreement does not contain a financing condition or a "market MAC" condition to the closing of the mergers. For more information, see "The Merger Agreement—Financing Cooperation" and "The Merger Agreement—Conditions to the Mergers."

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Interests of Our Trustees and Executive Officers in the Mergers (page 63)

        Our trustees and executive officers have certain interests in the mergers that are different from, or in addition to, the interests of our shareholders generally, including (1) the consideration that they would receive with respect to their Company restricted share awards, Company RSU awards, and Company options in connection with the mergers, (2) the vesting and conversion of their Company LTIP units into Class A partnership units, which will enable certain executive officers to elect to receive either the merger consideration or one newly created Series B preferred unit in the surviving partnership in respect of each Class A partnership unit, and (3) certain severance payments and benefits that may become payable upon a qualifying termination following the closing of the mergers. See "The Mergers—Interests of Our Trustees and Executive Officers in the Mergers" for additional information about interests that our trustees and executive officers have in the mergers that are different than yours.

Restriction on Solicitation of Company Acquisition Proposals (page 92)

        Under the terms of the merger agreement, we and our subsidiaries are subject to restrictions on our ability to solicit any company acquisition proposals (as defined in the section entitled "The Merger Agreement—Shareholders' Meeting"), including, among others, restrictions on our ability to furnish to any third parties any non-public information in connection with any company acquisition proposal, or engage in any discussions or negotiations regarding any company acquisition proposal, or propose or agree to do any of the foregoing. Subject to the terms of the merger agreement, we or our subsidiaries may furnish non-public information to, and engage in discussions or negotiations with, a third party if we receive an unsolicited written bona fide company acquisition proposal from such third party after the date of the merger agreement and that did not result from our breach of our obligations described in the section entitled "The Merger Agreement—Restriction on Solicitation of Company Acquisition Proposals," and our board of trustees determines in good faith, after consultation with its outside legal counsel and financial advisors, that such company acquisition proposal constitutes or could reasonably be expected to lead to a superior proposal (as defined in the section entitled "The Merger Agreement—Restriction on Solicitation of Company Acquisition Proposals"). Under certain circumstances and after following certain procedures and adhering to certain restrictions, we are permitted to terminate the merger agreement if our board of trustees approves, and concurrently with the termination of the merger agreement, we enter into, a definitive agreement providing for the implementation of a superior proposal (subject to payment of the company termination fee (as described below)).

Conditions to the Mergers (page 101)

        Completion of the mergers depends upon the satisfaction or waiver of a number of conditions, including, among others, that:

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Termination of the Merger Agreement (page 102)

        We and Parent may mutually agree to terminate and abandon the merger agreement at any time prior to the closing date, even after we have obtained the requisite vote of our common shareholders to approve the merger and the other transactions contemplated by the merger agreement.

Termination by either the Company or Parent

        In addition, we, on the one hand, or Parent, on the other hand, may terminate and abandon the merger agreement by written notice to the other at any time prior to the closing date, even after we have obtained the requisite vote of our common shareholders to approve the merger and the other transactions contemplated by the merger agreement, if:

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Termination by the Company

        We may also terminate and abandon the merger agreement by written notice to Parent at any time prior to the closing date, even after we have obtained the requisite vote of our common shareholders to approve the merger and the other transactions contemplated by the merger agreement, if:

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Termination by Parent

        Parent may also terminate and abandon the merger agreement by written notice to us at any time prior to the closing date, even after we have obtained the requisite vote of our common shareholders to approve the merger and the other transactions contemplated by the merger agreement, if:

Termination Fees (page 104)

Termination Fee Payable by the Company

        We have agreed to pay a termination fee as directed by Parent of $138 million, which we refer to as the company termination fee, if:

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        However, the company termination fee will equal $46 million if the merger agreement is terminated by us pursuant to the provisions described in the first bullet point under "The Merger Agreement—Termination of the Merger Agreement—Termination by the Company" in order to enter into a definitive agreement with an "excluded party" providing for the implementation of a superior proposal, which we refer to as an excluded party termination.

        An "excluded party" is a person or group of persons that submitted a written bona fide company acquisition proposal to us after the date of the merger agreement and prior to June 20, 2018 that our board of trustees determines prior to June 20, 2018, after consultation with outside legal counsel and financial advisors, constitutes, or could reasonably be expected to lead to, a superior proposal if: (1) we provide written notice to Parent promptly (and in any event within 48 hours) of such determination, and (2) at or prior to July 5, 2018 we provide a notice of change of recommendation to Parent with respect to our intention to undertake an excluded party termination to enter into a definitive agreement providing for the implementation of such company acquisition proposal. We refer to such company acquisition proposal as a "qualified proposal."

        However in certain circumstances such a person or group will cease to be an excluded party, as is described under "The Merger Agreement—Termination Fees—Termination Fee Payable by the Company."

Termination Fee Payable by Parent

        Parent has agreed to pay to us a termination fee of $414 million, which we refer to as the parent termination fee, if we terminate the merger agreement pursuant to the provisions described in the second bullet point or third bullet point under "The Merger Agreement—Termination of the Merger Agreement—Termination by the Company."

Guaranty and Remedies (page 105)

        In connection with the merger agreement, the Sponsor entered into a guaranty in our favor to guarantee Parent's payment obligations with respect to the parent termination fee and certain expense reimbursement and indemnification obligations of Parent under the merger agreement, subject to the terms and limitations set forth in the guaranty.

        The maximum aggregate liability of the Sponsor under the guaranty will not exceed $414 million, plus all reasonable and documented third party costs and out-of-pocket expenses (including reasonable fees of counsel) actually incurred by us relating to any litigation or other proceeding brought by us to enforce our rights under the guaranty, if we prevail in such litigation or proceeding.

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        We and the Partnership cannot seek specific performance to require Parent, Merger Sub I or Merger Sub II to complete the mergers and, subject to limited exceptions, including with respect to enforcing confidentiality provisions and certain expense reimbursement and indemnification obligations of Parent, our sole and exclusive remedy against Parent, Merger Sub I or Merger Sub II relating to any breach of the merger agreement or otherwise will be the right to receive the parent termination fee under the conditions described under "The Merger Agreement—Termination Fees—Termination Fee Payable by Parent." Parent, Merger Sub I and Merger Sub II may, however, seek specific performance to require us and the Partnership to complete the mergers.

Regulatory Matters (page 69)

        We are unaware of any material federal, state or foreign regulatory requirements or approvals that are required for the execution of the merger agreement or the completion of either the merger or the partnership merger, other than the acceptance for record of the articles of merger with respect to the merger by the State Department of Assessments and Taxation of Maryland, and the filing of the certificates of merger with respect to each of the merger and the partnership merger with the Secretary of State of the State of Delaware.

No Dissenters' Rights of Appraisal (page 110)

        We are organized as a real estate investment trust under Maryland law. Holders of our common shares may not exercise any appraisal rights, dissenters' rights or the rights of an objecting shareholder to receive the fair value of the shareholder's shares in connection with the merger because, as permitted by the Maryland REIT Law, our declaration of trust provides that shareholders are not entitled to exercise such rights unless our board of trustees, upon the affirmative vote of a majority of the entire board, determines that the rights apply. Our board of trustees has made no such determination. However, our common shareholders can vote against the merger and the other transactions contemplated by the merger agreement.

Litigation Relating to the Mergers (page 70)

        Following announcement of the merger agreement, two purported class actions related to the proposed transaction, Anderson v. Gramercy Property Trust et al., No. 1:18-cv-05335-PCK and Franchi v. Gramercy Property Trust et al., No. 1:18-cv-01842-ELH, were filed in the United States District Court for the Southern District of New York and the United States District Court for the District of Maryland, respectively, and a third complaint related to the proposed transaction, Madry v. Gramercy Property Trust et al., No. 1:18-cv-01851-TDC, was filed as an individual (not a class) action in the United States District Court for the District of Maryland. The lawsuits all name as defendants the Company and the members of our board of trustees. The complaints allege, among other things, that the individual defendants caused the Company to file a materially incomplete and misleading preliminary proxy statement relating to the proposed transaction in violation of Sections 14(a) and 20(a) of the Exchange Act. The Anderson and Madry complaints seek a variety of equitable and injunctive relief, including enjoining defendants from consummating the proposed merger transaction unless and until the Company provides supplemental disclosures, unspecified damages and, in the case of the Anderson complaint, rescission of the merger agreement or any of the terms thereof, or rescissory damages. The Franchi complaint seeks, among other relief, to enjoin defendants from proceeding with, consummating or closing the proposed merger transaction, rescission of the merger transaction or rescissory damages and dissemination of a supplemental proxy statement. All three complaints also seek an award of attorneys' and expert fees and expenses. The courts have not acted on any of these complaints, and no relief has been granted as of the date of this proxy statement. We believe the lawsuits are without merit.

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Material U.S. Federal Income Tax Consequences (page 70)

        The receipt of cash in exchange for our common shares pursuant to the merger will be a taxable transaction for U.S. federal income tax purposes. You should consult your own tax advisors regarding the particular tax consequences to you of the exchange of our common shares for cash pursuant to the merger in light of your particular circumstances (including the application and effect of any state, local or foreign income and other tax laws). For further discussion, see "The Mergers—Material U.S. Federal Income Tax Consequences."

Delisting and Deregistration of Our Common Shares and Preferred Shares (page 74)

        If the merger is completed, our common shares and our preferred shares will no longer be traded on the New York Stock Exchange, which we refer to as the NYSE, and will be deregistered under the Exchange Act.

Market Price of Our Common Shares (page 107)

        Our common shares are listed on the NYSE under the trading symbol "GPT." On May 4, 2018, the last trading day prior to the date of the public announcement of the merger agreement, the reported closing price per share for our common shares on the NYSE was $23.82. On June 26, 2018, the last trading day before the date of this proxy statement, the reported closing price per share for our common shares on the NYSE was $27.63. You are encouraged to obtain current market quotations for our common shares.

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QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGERS

        The following questions and answers address briefly some questions you may have regarding the special meeting and the proposed mergers. These questions and answers may not address all questions that may be important to you as a shareholder. Please refer to the more detailed information contained elsewhere in this proxy statement, as well as the additional documents to which it refers or which it incorporates by reference, including the merger agreement, a copy of which is attached to this proxy statement as Exhibit A.

Q:
What is the proposed transaction?

A:
The proposed transaction is the acquisition of the Company and its subsidiaries, including the Partnership, by affiliates of Blackstone pursuant to the merger agreement. After the merger and the other transactions contemplated by the merger agreement have been approved by our common shareholders and the other closing conditions under the merger agreement have been satisfied or waived, Merger Sub II will be merged with and into the Partnership, with the Partnership continuing as the Surviving Partnership. Immediately following the partnership merger effective time, Gramercy Property Trust will merge with and into Merger Sub I, with Merger Sub I continuing as the Surviving Company. The mergers will occur at the times provided in the merger agreement. For additional information about the mergers, please review the merger agreement attached to this proxy statement as Exhibit A and incorporated by reference into this proxy statement. We encourage you to read the merger agreement carefully and in its entirety, as it is the principal document governing the mergers.

Q:
As a common shareholder, what will I receive in the merger?

A:
For each outstanding common share that you own immediately prior to the merger effective time, you will receive $27.50 in cash, plus, if the mergers are consummated after October 15, 2018, a per diem amount of approximately $0.004 in cash for each day from and after such date until (but not including) the closing date, without interest and less any applicable withholding taxes.

Q:
Will I receive any regular quarterly dividends with respect to the common shares that I own?

A:
On April 30, 2018, our board of trustees declared a regular quarterly dividend of $0.3750 per common share for the quarter ended June 30, 2018, which will be paid on July 16, 2018 to common shareholders of record at the close of business on June 29, 2018. Under the terms of the merger agreement, we may not authorize, declare or pay any other dividends to the holders of our common shares during the term of the merger agreement without the prior written consent of Parent, other than dividends reasonably required to maintain our status as a REIT under the Code or to avoid the payment of income or excise tax (with any such additional required dividend resulting in a corresponding decrease to the merger consideration). However, if the mergers are consummated after October 15, 2018, holders of our common shares will receive, for each outstanding common share, a per diem amount of approximately $0.004 in cash for each day from and after such date until (but not including) the closing date, without interest and less any applicable withholding taxes. Such amount is meant to approximate the daily accrual of our regular quarterly dividend of $0.3750 per common share, commencing October 15, 2018.

Q:
What will happen to my share options, restricted share awards, restricted share unit awards and LTIP units in the mergers?

A:
Restricted Share Awards.    Immediately prior to the merger effective time, each Company restricted share award that is outstanding immediately prior to the merger effective time will be cancelled in exchange for a cash payment in an amount equal to (1) the number of common shares subject to

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Q:
What will happen to the Employee Share Purchase Plan in the mergers?

A:
The 2017 Employee Share Purchase Plan, which we refer to as the ESPP, will continue in effect through the current purchase period (i.e., through June 30, 2018, the end of the second fiscal quarter). The ESPP will be suspended thereafter and we will not offer the ESPP in any future fiscal quarters. No new participants are permitted to join the current ESPP purchase period in progress. You can withdraw from the ESPP at any time as stated in the ESPP.
Q:
When do you expect the mergers to be completed?

A:
If our common shareholders vote to approve the merger and the other transactions contemplated by the merger agreement, and assuming that the other conditions to the mergers are satisfied or waived, it is anticipated that the mergers will be completed in the second half of 2018. Pursuant to the merger agreement, the closing of the mergers will take place on the third business day after satisfaction or waiver of the conditions to the mergers described under "The Merger Agreement—Conditions to the Mergers" (other than those conditions that by their nature are to be satisfied or waived at the closing of the mergers, but subject to the satisfaction or waiver of such conditions) or at such other date as mutually agreed to by the parties to the merger agreement; however, Parent may on one or more occasions elect to delay the closing to a date that is on or prior to October 10, 2018. For further information regarding the timing of the closing of the mergers, see "The Merger Agreement—Effective Times; Closing Date."

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Q:
What happens if the mergers are not completed?

A:
If the merger and the other transactions contemplated by the merger agreement are not approved by our common shareholders, or if the mergers are not completed for any other reason, our common shareholders will not receive any payment for their common shares pursuant to the merger agreement. Instead, Gramercy Property Trust will remain a public company and our common shares will continue to be registered under the Exchange Act and listed on the NYSE. Upon a termination of the merger agreement, under certain circumstances, we will be required to pay Parent the company termination fee. In certain other circumstances, Parent will be required to pay us the parent termination fee upon termination of the merger agreement.

Q:
If the mergers are completed, how do I obtain the merger consideration for my common shares?

A:
Following the completion of the merger, your common shares will automatically be converted into the right to receive your portion of the merger consideration. Shortly after the merger is completed, you will receive a letter of transmittal describing how you may exchange your common shares for the merger consideration. If your common shares are held in "street name" by your broker, bank or other nominee, you may receive instructions from your broker, bank or other nominee as to what action, if any, you need to take to effect the surrender of your "street name" shares in exchange for the merger consideration.

Q:
If I hold my shares in certificated form, should I send in my share certificates now?

A:
No. Shortly after the merger is completed, you will be sent a letter of transmittal that includes detailed written instructions on how to return your certificates. You must return your certificates in accordance with such instructions in order to receive the merger consideration. PLEASE DO NOT SEND IN YOUR CERTIFICATE(S) NOW.

Q:
When and where is the special meeting?

A:
The special meeting will be held on August 9, 2018 at 9:30 a.m., New York time, at the offices of Wachtell, Lipton, Rosen & Katz, 51 West 52nd Street, New York, New York 10019.

Q:
Who can vote and attend the special meeting?

A:
All holders of record of our common shares as of the record date, which was the close of business on June 26, 2018, are entitled to receive notice of and attend and vote at the special meeting or any postponement or adjournment of the special meeting. Each common shareholder will be entitled to cast one vote on each matter presented at the special meeting for each common share that such holder owned as of the record date. The vote of the holders of our preferred shares is not required to approve any of the proposals at the special meeting and is not being solicited.

Q:
What vote of common shareholders is required to approve the merger and the other transactions contemplated by the merger agreement?

A:
Approval of the merger and the other transactions contemplated by the merger agreement requires the affirmative vote of the holders of common shares entitled to cast not less than a majority of all the votes entitled to be cast on the matter at the special meeting. Because the required vote for this proposal is based on the number of votes our common shareholders are entitled to cast rather than on the number of votes cast, failure to vote your common shares (including failure to give voting instructions to your broker, bank or other nominee) and abstentions will have the same effect as voting "AGAINST" the proposal to approve the merger and the other transactions contemplated by the merger agreement.

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Q:
What vote of common shareholders is required to approve, on a non-binding, advisory basis, the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger?

A:
Approval, on a non-binding, advisory basis, of the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger requires the affirmative vote of a majority of the votes cast on the proposal. For the purpose of this proposal, failure to vote your common shares (including failure to give voting instructions to your broker, bank or other nominee) and abstentions will have no effect on the proposal.

Q:
What vote of common shareholders is required to approve adjournments of the special meeting?

A:
Approval of any adjournment of the special meeting to solicit additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement requires the affirmative vote of a majority of the votes cast on the proposal. For the purpose of this proposal, failure to vote your common shares (including failure to give voting instructions to your broker, bank or other nominee) and abstentions will have no effect on the proposal.

Q:
Why is my vote important?

A:
If you do not authorize your proxy or voting instructions or vote in person at the special meeting, it will be more difficult for us to obtain the necessary quorum to hold the special meeting. In addition, because the proposal to approve the merger and the other transactions contemplated by the merger agreement must be approved by the affirmative vote of the holders of common shares entitled to cast not less than a majority of all the votes entitled to be cast on the matter, your failure to authorize your proxy or voting instructions or to vote in person at the special meeting will have the same effect as a vote "AGAINST" the approval of the merger and the other transactions contemplated by the merger agreement.

Q:
How does the merger consideration compare to the market price of the Company's common shares?

A:
The merger consideration of $27.50 per share (disregarding, for these purposes, the additional consideration payable if the mergers are completed after October 15, 2018) represents a premium of approximately 15% over the closing price of our common shares of $23.82 per share on May 4, 2018, the last trading day prior to the public announcement of the merger agreement, and a premium of approximately 23% over the 30-day volume weighted average share price ending May 4, 2018.

Q:
How does our board of trustees recommend that I vote?

A:
Our board of trustees recommends that you vote "FOR" the proposal to approve the merger and the other transactions contemplated by the merger agreement, "FOR" the proposal to approve, on a non-binding, advisory basis, the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger, and "FOR" the proposal to approve any adjournment of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement.

Q:
Why am I being asked to consider and cast a vote on the non-binding proposal to approve the merger-related compensation payable to our named executive officers?

A:
The U.S. Securities and Exchange Commission, which we refer to as the SEC, has adopted rules that require companies to seek a nonbinding, advisory vote to approve certain compensation that

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Q:
What will happen if shareholders do not approve the non-binding proposal to approve the merger-related compensation?

A:
The vote to approve the non-binding proposal to approve the merger-related compensation is a vote separate and apart from the vote to approve the merger and the other transactions contemplated by the merger agreement. Approval of this proposal is a not a condition to completion of the mergers. The vote on this proposal is an advisory vote only, and it is not binding on us or our board of trustees. Further, the underlying arrangements are contractual in nature and not, by their terms, subject to shareholder approval. Accordingly, regardless of the outcome of the advisory vote, if the merger is completed, our named executive officers will be eligible to receive the compensation that may be paid or become payable to them that is based on or otherwise relates to the merger, in accordance with the terms and conditions applicable to such compensation.

Q:
Do any of the Company's trustees and executive officers have any interest in the mergers that is different than mine?

A:
Our trustees and executive officers have certain interests in the mergers that are different from, or in addition to, the interests of our shareholders generally, including (1) the consideration that they would receive with respect to their Company restricted share awards, Company RSU awards, and Company options in connection with the mergers, (2) the vesting and conversion of their Company LTIP units into Class A partnership units, which will enable certain executive officers to elect to receive either the merger consideration or one newly created Series B preferred unit in the surviving partnership in respect of each Class A partnership unit, and (3) certain severance payments and benefits that may become payable upon a qualifying termination following the closing of the mergers. See "The Mergers—Interests of Our Trustees and Executive Officers in the Mergers" for additional information about interests that our trustees and executive officers have in the mergers that are different than yours.

Q:
What do I need to do now?

A:
After carefully reading and considering the information contained in this proxy statement and the exhibits attached to this proxy statement, please vote your common shares or authorize a proxy to vote your common shares in one of the ways described below as soon as possible. You will be entitled to one vote for each common share that you owned as of the record date.

Q:
How do I cast my vote?

A:
If you are a common shareholder of record on the record date, you may vote in person at the special meeting or authorize a proxy to vote your common shares at the special meeting. You can authorize your proxy by completing, signing, dating and returning the enclosed proxy card in the accompanying pre-addressed, postage-paid envelope, or, if you prefer, by following the instructions on your proxy card for telephonic or Internet proxy authorization. If the telephone or Internet option is available to you, we strongly encourage you to use it because it is faster and less costly. Registered shareholders can transmit their voting instructions by telephone by calling 1-800-690-6903 or on the Internet at www.proxyvote.com. Telephone and Internet voting are available 24 hours a day until 11:59 p.m., Eastern Time, the day immediately prior to the special meeting. Have your proxy card with you if you are going to authorize your proxy by telephone or through the Internet. To authorize your proxy by mail, please complete sign, date and mail your proxy card in the envelope provided. If you attend the special meeting in person, you may request

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Q:
How do I cast my vote if my common shares are held of record in "street name"?

A:
If you own common shares through a broker, bank or other nominee (i.e., in "street name"), you must provide voting instructions in accordance with the instructions on the voting instruction card that your broker, bank or other nominee provides to you, since brokers, banks and other nominees do not have discretionary voting authority with respect to any of the proposals described in this proxy statement. If you have not received such voting instructions or require further information regarding such voting instructions, contact your broker, bank or other nominee who can give you directions on how to vote your common shares. If you hold your common shares through a broker, bank or other nominee and wish to vote in person at the special meeting, you must obtain a "legal proxy," executed in your favor, from the broker, bank or other nominee (which may take several days).

Q:
What will happen if I abstain from voting or fail to vote?

A:
With respect to the proposal to approve the merger and the other transactions contemplated by the merger agreement, if you abstain from voting, fail to cast your vote in person or by proxy or if you hold your common shares in "street name" and fail to give voting instructions to your broker, bank or other nominee, it will have the same effect as a vote "AGAINST" the merger and the other transactions contemplated by the merger agreement. With respect to the proposal regarding the non-binding, advisory vote on the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger and the proposal to approve any adjournment of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement, if you abstain from voting, fail to cast your vote in person or by proxy or if you hold your common shares in "street name" and fail to give voting instructions to your broker, bank or other nominee, it will not have any effect on the outcome of such proposals.

Q:
How will proxy holders vote my common shares?

A:
If you properly authorize a proxy prior to the special meeting, your common shares will be voted as you direct. If you authorize a proxy but no direction is otherwise made, your common shares will be voted "FOR" the proposal to approve the merger and the other transactions contemplated by the merger agreement, "FOR" the proposal to approve, on a nonbinding, advisory basis, the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger and "FOR" the proposal to approve any adjournment of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement. Pursuant to our bylaws, only the matters set forth in the Notice of Special Meeting may be brought before the special meeting.

Q:
What happens if I sell my common shares before the special meeting?

A:
If you held common shares on the record date but transfer them prior to the merger effective time, you will retain your right to vote at the special meeting, but not the right to receive the merger consideration for those shares. The right to receive such consideration when the merger becomes effective will pass to the person who at that time owns the common shares you previously owned.

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Q:
Can I change my vote after I have mailed my proxy card?

A:
Yes. If you own common shares as a record holder on the record date, you may revoke a previously authorized proxy at any time before it is exercised by filing with our Secretary a notice of revocation or a duly authorized proxy bearing a later date or by attending the meeting and voting in person. Attendance at the meeting will not, in itself, constitute revocation of a previously authorized proxy. If you have instructed a broker to vote your common shares, the foregoing options for changing your vote do not apply and instead you must follow the instructions received from your broker to change your vote.

Q:
Is the merger expected to be taxable to me?

A:
Yes. The receipt of cash in exchange for our common shares pursuant to the merger will be a taxable transaction for U.S. federal income tax purposes. You should consult your own tax advisors regarding the particular tax consequences to you of the exchange of our common shares for cash pursuant to the merger in light of your particular circumstances (including the application and effect of any state, local or foreign income and other tax laws). For further discussion, see "The Mergers—Material U.S. Federal Income Tax Consequences."

Q:
What rights do I have if I oppose the merger?

A:
If you are a common shareholder of record on the record date, you can vote against the proposal to approve the merger and the other transactions contemplated by the merger agreement. You are not, however, entitled to exercise any appraisal rights, dissenters' rights or the rights of an objecting shareholder to receive the fair value of the shareholder's shares in connection with the merger because, as permitted by the Maryland REIT Law, our declaration of trust provides that shareholders are not entitled to exercise any such rights unless our board of trustees, upon the affirmative vote of a majority of the entire board, determines that the rights apply. Our board of trustees has made no such determination. See "No Dissenters' Rights of Appraisal."

Q:
Where can I find the voting results of the special meeting?

A:
We intend to announce preliminary voting results at the special meeting and publish final results in a Current Report on Form 8-K that will be filed with the SEC following the special meeting. All reports that we file with the SEC are publicly available on the SEC's website at www.sec.gov when filed.

Q:
Can I participate if I am unable to attend the special meeting?

A:
If you are unable to attend the meeting in person, we encourage you to complete, sign, date and return your proxy card, or authorize your proxy or voting instructions by telephone or through the Internet. The special meeting will not be broadcast telephonically or over the Internet.

Q:
Have any shareholders already agreed to approve the merger?

A:
No. There are no agreements between Parent, Merger Sub I, Merger Sub II or other affiliates of Blackstone and any of our common shareholders in which a shareholder has agreed to vote in favor of approval of the merger and the other transactions contemplated by the merger agreement.

Q:
Where can I find more information about the Company?

A:
We file certain information with the SEC. You may read and copy this information at the SEC's public reference facilities. You may call the SEC at 1-800-SEC-0330 for information about these facilities. This information is also available on the SEC's website at www.sec.gov and on our

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Q:
Who will solicit and pay the cost of soliciting proxies?

A:
We will bear the cost of solicitation of proxies for the special meeting. Our board of trustees is soliciting your proxy on our behalf. In addition to the use of mails, proxies may be solicited by personal interview, telephone, facsimile, e-mail or otherwise, by our trustees, officers and other employees. We have engaged Morrow Sodali LLC to assist in the solicitation of proxies for a fee of $15,000, plus reimbursement of out-of-pocket expenses. We also will request persons, firms and corporations holding common shares in their names, or in the names of their nominees, that are beneficially owned by others to send or cause to be sent proxy materials to, and obtain proxies from, such beneficial owners and will reimburse such holders for their reasonable expenses in so doing.

Q:
Who can help answer my other questions?

A:
If after reading this proxy statement you have more questions about the special meeting or the mergers, you should contact us at:

Gramercy Property Trust
90 Park Avenue, 32nd Floor
New York, New York 10016
Attention: Edward J. Matey Jr., Secretary
(212) 297-1000

        You may also contact Morrow Sodali LLC, our proxy solicitor, as follows:

Morrow Sodali LLC
470 West Avenue—Suite 3000
Stamford, Connecticut 06902
Toll-Free: 1-800-662-5200

        If your broker holds your common shares, you should also contact your broker for additional information.

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

        This proxy statement and the documents that we incorporate by reference herein contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended (which we refer to as the Securities Act), and Section 21E of the Exchange Act). Also, documents we subsequently file with the SEC and incorporate by reference may contain forward-looking statements. These forward-looking statements include, among others, statements about the expected benefits of the mergers, the expected timing and completion of the mergers and the future business, performance and opportunities of the Company. Forward-looking statements involve numerous risks and uncertainties, and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods which may be incorrect or imprecise, and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). Forward-looking statements generally can be identified by the use of words such as "anticipate," "believe," "estimate," "expect," "intend," "plan," "foresee," "looking ahead," "is confident," "should," "will," "predicted," "likely," or similar words or phrases intended to identify information that is not historical in nature. Forward-looking statements are based on expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. These risks and uncertainties include, without limitation:

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        While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. For a further discussion of these and other factors that could impact our future results, performance or transactions, see the section entitled "Risk Factors" included in our Annual Report on Form 10-K for the year ended December 31, 2017, as updated by our future filings.

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PROPOSAL 1

PROPOSAL TO APPROVE THE MERGER

        We are asking our common shareholders to vote on a proposal to approve the merger of Gramercy Property Trust with and into Merger Sub I and the other transactions contemplated by the merger agreement.

        For detailed information regarding this proposal, see the information about the mergers and the merger agreement throughout this proxy statement, including the information set forth in the sections entitled "The Mergers" and "The Merger Agreement." A copy of the merger agreement is attached as Exhibit A to this proxy statement.

        Approval of the proposal to approve the merger and the other transactions contemplated by the merger agreement requires the affirmative vote of the holders of common shares entitled to cast not less than a majority of all the votes entitled to be cast on the matter. If you properly authorize your proxy by mail, by telephone or through the Internet, but do not indicate instructions to vote your common shares "FOR," "AGAINST" or "ABSTAIN" on this Proposal I, your common shares will be voted in accordance with the recommendation of our board of trustees, which is "FOR" this Proposal I. Because the required vote for this proposal is based on the number of votes our common shareholders are entitled to cast rather than on the number of votes cast, failure to vote your common shares (including failure to give voting instructions to your broker, bank or other nominee) and abstentions will have the same effect as voting "AGAINST" the proposal to approve the merger and the other transactions contemplated by the merger agreement.

        Approval of this proposal is a condition to the completion of the mergers. In the event this proposal is not approved, the mergers cannot be completed.

Recommendation of the Board of Trustees

        Our board of trustees unanimously recommends that our common shareholders vote "FOR" the proposal to approve the merger.

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PROPOSAL 2

PROPOSAL TO APPROVE THE MERGER-RELATED COMPENSATION

        Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and Rule 14a-21(c) under the Exchange Act, we are asking our common shareholders to vote at the special meeting on an advisory basis regarding the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the mergers. Information intended to comply with Item 402(t) of Regulation S-K concerning this compensation, subject to certain assumptions described therein, is presented in the section entitled "The Mergers—Interests of Our Trustees and Executive Officers in the Mergers—Quantification of Potential Payments to Our Executive Officers in Connection with the Mergers."

        The shareholder vote on executive compensation is an advisory vote only, and it is not binding on us or our board of trustees. Further, the underlying arrangements are contractual in nature and not, by their terms, subject to shareholder approval. Accordingly, regardless of the outcome of the advisory vote, if the mergers are completed, our named executive officers will be eligible to receive the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the mergers, in accordance with the terms and conditions applicable to such compensation. Approval of this proposal is not a condition to the completion of the mergers.

        We are asking our common shareholders to vote "FOR" the following resolution:

        Adoption of the above resolution, on a non-binding, advisory basis, requires the affirmative vote of a majority of the votes cast on the proposal. If you properly authorize your proxy by mail, by telephone or through the Internet, but do not indicate instructions to vote your common shares "FOR," "AGAINST" or "ABSTAIN" on this Proposal 2, your common shares will be voted in accordance with the recommendation of our board of trustees, which is "FOR" this Proposal 2. An abstention or failure to vote on this proposal will have no effect on the approval of this proposal.

Recommendation of the Board of Trustees

        Our board of trustees unanimously recommends that our common shareholders vote "FOR" the proposal to approve, on a non-binding, advisory basis, the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger.

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PROPOSAL 3

PROPOSAL TO APPROVE ADJOURNMENT OF THE MEETING

        We are asking our common shareholders to vote on a proposal to approve any adjournments of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement.

        Approval of the proposal to approve any such adjournment of the special meeting requires the affirmative vote of a majority of the votes cast on the proposal. Approval of this proposal is a not a condition to the completion of the mergers. If you properly authorize your proxy by mail, by telephone or through the Internet, but do not indicate instructions to vote your common shares "FOR," "AGAINST" or "ABSTAIN" on this Proposal 3, your common shares will be voted in accordance with the recommendation of our board of trustees, which is "FOR" this Proposal 3. An abstention or failure to vote on this proposal will have no effect on the approval of this proposal.

        In addition, even if a quorum is not present at the special meeting, the chairman of the meeting may adjourn the meeting to another place, date or time announced at the special meeting (subject to certain restrictions in the merger agreement, including that the special meeting generally may not be held, without Parent's consent, on a date that is more than 30 days after the date on which the special meeting was originally scheduled).

Recommendation of the Board of Trustees

        Our board of trustees unanimously recommends that our common shareholders vote "FOR" the proposal to approve any adjournment of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement.

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THE PARTIES TO THE MERGERS

Gramercy Property Trust
90 Park Avenue, 32nd Floor
New York, New York 10016
(212) 297-1000

        We were formed as a Maryland real estate investment trust in March 2004 and elected to be taxed as a REIT under the Code, beginning with the taxable year ended December 31, 2004. We are a leading global investor and asset manager of commercial real estate. The Company specializes in acquiring and managing high quality, income producing industrial commercial real estate leased to high quality tenants in major markets in the United States and Europe. Our website is www.gptreit.com. The information found on, or otherwise accessible through, our website is not incorporated into, and does not form a part of, this proxy statement or any other report or document we file with or furnish to the SEC. Our common shares are listed on the NYSE under the symbol "GPT." For additional information about us and our business, please refer to "Where You Can Find More Information."

GPT Operating Partnership LP
90 Park Avenue, 32nd Floor
New York, New York 10016
(212) 297-1000

        The Partnership was formed as a Delaware limited partnership in March 2004. The Partnership indirectly owns (i) all of our consolidated real estate investments, (ii) our interests in unconsolidated investments, and (iii) the entities that conduct our third-party asset management operations. We are the sole general partner of the Partnership. As of June 26, 2018, third-party holders of limited partnership interests (including holders of Company LTIP units that will be converted prior to the partnership merger effective time, into Class A partnership units as described in this proxy statement) owned approximately 4.24% of the Partnership.

BRE Glacier Parent L.P.
c/o The Blackstone Group
345 Park Avenue
New York, New York 10154
(212) 583-5000

        Parent is a Delaware limited partnership and an affiliate of the Sponsor. Parent was formed solely for the purpose of acquiring us and has not carried on any activities to date, except for activities incidental to its formation and activities undertaken in connection with the transactions contemplated by the merger agreement. The Sponsor is an affiliate of Blackstone.

        Blackstone is a global leader in real estate investing. Blackstone's real estate business was founded in 1991 and has approximately $120 billion in investor capital under management. Blackstone's real estate portfolio includes hotel, office, retail, industrial and residential properties in the US, Europe, Asia and Latin America. Major holdings include Hilton Worldwide, Invitation Homes (single family homes), Logicor (pan-European logistics) and prime office buildings in the world's major cities. Blackstone real estate also operates one of the leading real estate finance platforms, including management of the publicly traded Blackstone Mortgage Trust.

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BRE Glacier L.P.
c/o The Blackstone Group
345 Park Avenue
New York, New York 10154
(212) 583-5000

        Merger Sub I is a Delaware limited partnership. BRE Glacier LLC, a Delaware limited liability company, is the sole general partner of Merger Sub I. Merger Sub I was formed solely for purposes of facilitating Parent's acquisition of us and has not carried on any activities to date, except for activities incidental to its formation and activities undertaken in connection with the transactions contemplated by the merger agreement. Pursuant to the merger agreement, on the closing date, we will merge with and into Merger Sub I, and Merger Sub I will continue as the Surviving Company.

BRE Glacier Acquisition L.P.
c/o The Blackstone Group
345 Park Avenue
New York, New York 10154
(212) 583-5000

        Merger Sub II is a Delaware limited partnership. BRE Glacier Acquisition LLC, a Delaware limited liability company, is the sole general partner of Merger Sub II. Merger Sub II was formed solely for purposes of facilitating Parent's acquisition of us and has not carried on any activities to date, except for activities incidental to its formation and activities undertaken in connection with the transactions contemplated by the merger agreement. Pursuant to the merger agreement, on the closing date, Merger Sub II will merge with and into the Partnership, and the Partnership will continue as the Surviving Partnership.

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THE SPECIAL MEETING

Date, Time and Purpose of the Special Meeting

        This proxy statement is being furnished to our shareholders in connection with the solicitation of proxies by our board of trustees to be exercised at a special meeting to be held on August 9, 2018 at 9:30 a.m., New York time. The special meeting will be held at the offices of Wachtell, Lipton, Rosen & Katz, 51 West 52nd Street, New York, New York 10019. The purpose of the special meeting is for you to consider and vote on the following matters:

        Pursuant to our bylaws, only the matters set forth in the Notice of Special Meeting may be brought before the special meeting. The affirmative vote of holders of common shares entitled to cast not less than a majority of all the votes entitled to be cast on the matter is required to approve the merger and the other transactions contemplated by the merger agreement and for the mergers to occur. A copy of the merger agreement is attached as Exhibit A to this proxy statement, which we encourage you to read carefully in its entirety.

Record Date, Notice and Quorum

        All holders of record of our common shares as of the record date, which was the close of business on June 26, 2018, are entitled to receive notice of and attend and vote at the special meeting or any postponement or adjournment of the special meeting. Each common shareholder will be entitled to cast one vote on each matter presented at the special meeting for each common share that such holder owned as of the record date. On the record date, there were 160,792,820 common shares outstanding and entitled to vote at the special meeting.

        The presence in person or by proxy of our common shareholders entitled to cast a majority of all the votes entitled to be cast at the special meeting will constitute a quorum for purposes of the special meeting. A quorum is necessary to transact business at the special meeting. Abstentions will be counted as shares present for the purposes of determining the presence of a quorum. If a quorum is not present at the special meeting, we expect that the special meeting will be adjourned to a later date. Pursuant to our bylaws, the chairman of the meeting may adjourn the meeting, whether or not a quorum is present, to a later date, time and place announced at the special meeting.

Required Vote

        Completion of the mergers requires approval of the merger and the other transactions contemplated by the merger agreement by the affirmative vote of the holders of common shares entitled to cast not less than a majority of all the votes entitled to be cast on the matter. Each common shareholder is entitled to cast one vote on each matter presented at the special meeting for each common share owned by such shareholder on the record date. Because the required vote for this proposal is based on the number of votes our common shareholders are entitled to cast rather than on the number of votes cast, if you fail to vote by proxy or in person (including by abstaining), or fail to

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instruct your broker on how to vote, such failure will have the same effect as voting against the proposal to approve the merger and the other transactions contemplated by the merger agreement.

        In addition, the approval of the proposal regarding the non-binding, advisory vote on the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger, and the approval of the proposal regarding any adjournment of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement, each requires the affirmative vote of a majority of the votes cast on the proposal. Approval of these proposals is not a condition to completion of the mergers. For the purpose of each of these proposals, if you fail to vote by proxy or in person, or fail to instruct your broker on how to vote, it will not have any effect on the outcome of such proposals. Abstentions are not considered votes cast and therefore will have no effect on the outcome of these proposals.

        Accordingly, in order for your common shares to be voted, if you are a shareholder of record, you must either return the enclosed proxy card, authorize your proxy or voting instructions by telephone or through the Internet or vote in person at the special meeting. The vote of the holders of our preferred shares is not required to approve any of the proposals at the special meeting and is not being solicited.

        As of the record date, our trustees and executive officers owned and are entitled to vote an aggregate of approximately 1,080,321 of our common shares, entitling them to exercise approximately 0.67% of the voting power of our common shares entitled to vote at the special meeting. Our trustees and executive officers have informed us that they intend to vote the common shares that they own in favor of the proposal to approve the merger and the other transactions contemplated by the merger agreement, in favor of the proposal regarding the non-binding, advisory vote on the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger and in favor of the proposal to approve any adjournment of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement, although they have no obligation to do so.

        Votes cast by proxy or in person at the special meeting will be counted by the person appointed by us to act as inspector of election for the special meeting. The inspector of election will also determine the number of common shares represented at the special meeting, in person or by proxy.

How to Authorize a Proxy

        Holders of record of our common shares may vote or cause their shares to be voted by proxy using one of the following methods:

        Regardless of whether you plan to attend the special meeting, we request that you authorize a proxy for your common shares as described above as promptly as possible.

        Under NYSE rules, all of the proposals in this proxy statement are non-routine matters, so there can be no broker non-votes at the special meeting. A broker non-vote occurs when shares held by a bank, broker, trust or other nominee are represented at a meeting, but the bank, broker, trust or other nominee has not received voting instructions from the beneficial owner and does not have the discretion to direct the voting of the shares on a particular proposal but has discretionary voting power on other proposals at such meeting. Accordingly, if you own common shares through a broker, bank or

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other nominee (i.e., in "street name"), you must provide voting instructions in accordance with the instructions on the voting instruction card that your broker, bank or other nominee provides to you, as brokers, banks and other nominees do not have discretionary voting authority with respect to any of the three proposals described in this proxy statement. You should instruct your broker, bank or other nominee as to how to vote your common shares following the directions contained in such voting instruction card. If you have not received such voting instructions or require further information regarding such voting instructions, contact your broker, bank or other nominee who can give you directions on how to vote your common shares. If you hold your common shares through a broker, bank or other nominee and wish to vote in person at the special meeting, you must obtain a "legal proxy," executed in your favor, from the broker, bank or other nominee (which may take several days). Because the proposal to approve the merger and the other transactions contemplated by the merger agreement requires the affirmative vote of the holders of common shares entitled to cast not less than a majority of all the votes entitled to be cast on the matter, the failure to provide your bank, broker, trust or other nominee with voting instructions will have the same effect as a vote "AGAINST" the proposal to approve the merger and the other transactions contemplated by the merger agreement. Because the approval of each of (1) the non-binding compensation advisory proposal and (2) the proposal to adjourn the special meeting if necessary or appropriate requires the affirmative vote of a majority of the votes cast on such proposal, and because your bank, broker, trust or other nominee does not have discretionary authority to vote on either proposal, the failure to provide your bank, broker, trust or other nominee with voting instructions will have no effect on approval of either proposal, assuming a quorum is present.

        If you are a holder of our restricted share awards, your shares will be voted as you specify on your proxy card and will not be voted if the proxy card is not returned or if you do not vote in person or authorize a proxy by telephone or through the Internet.

Proxies and Revocation

        If you authorize a proxy, your common shares will be voted at the special meeting as you indicate on your proxy. If no instructions are indicated when you authorize your proxy, your common shares will be voted in accordance with the recommendations of our board of trustees. Our board of trustees recommends that you vote "FOR" the proposal to approve the merger and the other transactions contemplated by the merger agreement, "FOR" the proposal to approve, on a non-binding, advisory basis, the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger and "FOR" the proposal to approve any adjournment of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement.

        You may revoke your proxy at any time, but only before the proxy is voted at the special meeting, in any of three ways:

        Attendance at the special meeting will not, in itself, constitute revocation of a previously granted proxy. If you own common shares in "street name," you may revoke or change previously granted

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voting instructions by following the instructions provided by the broker, bank or other nominee that is the registered owner of the shares.

        Pursuant to our bylaws, only the matters set forth in the Notice of Special Meeting may be brought before the special meeting.

Solicitation of Proxies

        We will bear the cost of solicitation of proxies for the special meeting. In addition to the use of mails, proxies may be solicited by personal interview, telephone, facsimile, e-mail or otherwise, by our officers, trustees and other employees, for which they will not receive additional compensation. We have engaged Morrow Sodali LLC to assist in the solicitation of proxies for a fee of $15,000, plus reimbursement of out-of-pocket expenses, and we have agreed to indemnify Morrow Sodali LLC against certain losses, costs and expenses. We also will request persons, firms and corporations holding common shares in their names, or in the names of their nominees, that are beneficially owned by others to send or cause to be sent proxy materials to, and obtain proxies from, such beneficial owners and will reimburse such holders for their reasonable expenses in so doing.

Adjournments

        Although it is not currently expected, the special meeting may be adjourned for the purpose of soliciting additional proxies if the holders of a sufficient number of common shares are not present at the special meeting, in person or by proxy, to constitute a quorum or if we believe it is reasonably likely that the merger and the other transactions contemplated by the merger agreement will not be approved at the special meeting when convened on August 9, 2018, or when reconvened following any adjournment. Any adjournments may be made to a date not more than 120 days after the original record date without notice (other than by an announcement at the special meeting), by the chairman of the meeting, whether or not a quorum is present (subject to certain restrictions in the merger agreement, including that the special meeting generally may not be held, without Parent's consent, on a date that is more than 30 days after the date on which the special meeting was originally scheduled).

Postponements

        At any time prior to convening the special meeting, we may postpone the special meeting for any reason without the approval of our common shareholders to a date not more than 120 days after the original record date (subject to certain restrictions in the merger agreement, including that the special meeting generally may not be held, without Parent's consent, on a date that is more than 30 days after the date on which the special meeting was originally scheduled).

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THE MERGERS

General Description of the Mergers

        Under the terms of the merger agreement, affiliates of Blackstone will acquire us and our subsidiaries, including the Partnership, through the merger of us with and into Merger Sub I and the merger of Merger Sub II with and into the Partnership. Pursuant to the terms of the merger agreement, Merger Sub II will merge with and into the Partnership, with the Partnership continuing as the Surviving Partnership. Immediately following the effective time of the partnership merger, we will merge with and into Merger Sub I, with Merger Sub I continuing as the Surviving Company.

        This proxy statement does not constitute any solicitation of consents in respect of the partnership merger, and does not constitute an offer to exchange or convert any Class A partnership units that you may own for or into Series B preferred units in the Surviving Partnership.

Background of the Mergers

        The Company's management and board of trustees regularly review our performance and prospects in light of the current business, economic, capital markets and real estate environments, as well as developments in the net lease industrial, office and retail real estate businesses and the opportunities and challenges facing participants in those businesses. These reviews have included consideration, from time to time, of potential strategic alternatives, including potential acquisitions, dispositions, joint ventures and business combination transactions, as well as remaining an independent standalone company. Our board and management have considered various challenges that we have faced as a public company, in particular the competitive environment for acquiring industrial real estate assets and the challenges of owning and managing a portfolio of properties with relatively long-term net leases, as well as the discount to estimated net asset value at which the Company's common shares have recently traded and the implications of this discount on the cost of obtaining capital to fund future acquisitions and growth.

        On April 26, 2017, the board held a regularly scheduled in-person meeting. During the meeting, the board reviewed the Company's business plan and performance metrics comparing the Company to other REITs operating in the industrial and net lease sectors, and determined to engage in further reviews of our business plan, outlook and possible strategic alternatives at future meetings of the board. Following the board meeting, management, with the assistance of Morgan Stanley, which had previously provided financial advisory services to the Company from time to time, prepared for additional review at the regularly scheduled meeting of the board in July 2017.

        On July 31, 2017, the board held a regularly scheduled in-person meeting to engage in a detailed review of the Company's business plan and outlook in light of recent market developments, including the competitive market for acquiring industrial and other real estate properties and the Company's market valuation relative to peer companies, which the board and management expected would present challenges for our ability to acquire assets and grow earnings. At the meeting, management and representatives of Morgan Stanley reviewed with the board our performance, business outlook and portfolio, investor views, preliminary valuation information regarding the Company and the market outlook for industrial and office assets. Management and representatives of Morgan Stanley also reviewed with the board investment opportunities and possible strategic alternatives that could be available to the Company, including acquisitions of small and large portfolios of properties, build-to-suit transactions and additional development activities, actions to optimize the Company's existing portfolio, joint venture transactions involving portfolios of the Company's assets, a sale or spin-off of one or more portfolios of assets, and a merger or sale transaction, as well as considerations regarding each of these possible opportunities and alternatives. At the meeting, the board determined to continue to monitor market developments and possible opportunities and alternatives.

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        On October 25, 2017, the board held a regularly scheduled in-person meeting, during which it discussed and reviewed, with the assistance of management and representatives of Morgan Stanley, the Company's performance, business outlook and portfolio, including short-term and long-term challenges relating to the Company's office portfolio and future acquisitions of industrial assets. In addition, management and the representatives of Morgan Stanley reviewed with the board possible strategic alternatives that could be available to the Company, including asset acquisitions, portfolio optimization, a sale or spin-off of a portfolio of the Company's assets, joint venture transactions and a merger transaction. At the meeting, the board authorized a preliminary discussion with a representative of a publicly traded REIT operating in the net lease sector (which we refer to as Company A) to explore Company A's interest in considering a strategic transaction involving the Company in light of the board's view that Company A could be a logical transaction counterparty because it was believed to have interest in a transaction with a REIT operating in the industrial sector and would be capable of engaging in a transaction of a significant size. Subsequently, a representative of Morgan Stanley engaged in a preliminary discussion with the chief executive officer of Company A regarding possible strategic transactions, including a transaction involving the Company. The chief executive officer of Company A indicated that Company A would potentially be interested in a transaction involving the Company in the future, but it was unlikely to be interested in an acquisition of the whole company at that time. Following this discussion, Company A did not express further interest in a transaction involving the Company despite follow-up from Morgan Stanley over the next several months.

        On January 24, 2018, the board held a special in-person meeting, during which management and representatives of Morgan Stanley reviewed with the board the Company's recent financial performance and recent market developments affecting the Company, including the competitive environment for acquiring industrial real estate assets and the market valuations of the Company and peer companies. In addition, the representatives of Morgan Stanley provided an update regarding the outreach to Company A and additional analysis that management and Morgan Stanley had undertaken regarding possible strategic transactions, including recent joint venture, portfolio, and merger and sale transactions involving industrial properties, and possible strategic alternatives that could be available to the Company in light of recent market developments. At the meeting, the board determined to engage in further review of the Company's standalone plan and prospects and possible strategic alternatives at its upcoming February 2018 meeting and requested that management and Morgan Stanley prepare additional information for review with the board at that meeting.

        On February 27, 2018, the board held a regularly scheduled in-person meeting during which the board discussed, among other matters, the decline in the share prices of the Company and other companies in the REIT industry beginning in late 2017, which had resulted in year-to-date total return declines of 10% and 16% for the MSCI US REIT Index and the Company's common shares, respectively, compared to a 3% increase for the S&P 500, and the strategic implications of these developments. The trading price of the Company's common shares had declined from a 52-week high share price of $31.26 on October 13, 2017 and had most recently closed at a price of $22.31 per share on February 26, 2018, which represented a significant discount to the Company's mean analyst net asset value of $26.22 as of February 23, 2018. In addition, the market for acquiring industrial and other real estate properties remained competitive, presenting challenges for the ability of the Company to acquire assets on an accretive basis. During the meeting, management reviewed our business plan and recent financial and operating performance and presented certain projections of future financial performance prepared in connection with the Company's regular planning process. In addition, representatives of Morgan Stanley led the board through a review of the potential outlook for the industry generally, as well as for the Company. The representatives of Morgan Stanley also reviewed with the board potential strategic alternatives available to the Company, which included a sale of the Company to a private or public acquiror, a merger or acquisition involving another public company, a sale or spin-off of one or more of the Company's portfolios of assets, a joint venture transaction involving one or more of the Company's portfolios of assets, and remaining as a standalone public company. As part of this review,

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the representatives of Morgan Stanley presented a preliminary valuation analysis of the Company and discussed certain considerations relating to precedent transactions and potential transaction counterparties. In addition, representatives of Wachtell, Lipton, Rosen & Katz, the Company's outside legal counsel (which we refer to as Wachtell Lipton), reviewed with the trustees their duties in connection with their consideration of potential strategic alternatives for the Company. At this meeting, the board directed management, with the assistance of Morgan Stanley, to take steps to explore strategic alternatives, including preparing due diligence information that would be made available to counterparties in connection with a transaction process, with an initial focus on a transaction involving a sale of the Company as a whole in light of the potential advantages of such a transaction as compared to other possible strategic alternatives, including with respect to potential value, timing and certainty. The board determined that management should work with Morgan Stanley in connection with the strategic alternatives process, and also gave consideration to the possibility that Morgan Stanley might have relationships with potential transaction counterparties, with respect to which additional information would be requested from Morgan Stanley in connection with the strategic alternatives process. The board also formed a transaction committee, consisting of Charles E. Black, Gordon F. DuGan, Thomas D. Eckert, Gregory F. Hughes and Jeffrey E. Kelter, to facilitate the board's evaluation of potential transactions involving the Company, and to which management subsequently provided regular updates regarding the strategic transactions process.

        Following the board meeting, management, with the assistance of representatives of Morgan Stanley, Eastdil Secured, L.L.C. (which we refer to as Eastdil), which the Company retained to provide real estate consulting services in connection with its exploration of a possible strategic transaction, and Wachtell Lipton, began to populate a data room with property and Company due diligence information that could be made available to possible transaction counterparties.

        From time to time, representatives of the Company, including Gordon DuGan, our Chief Executive Officer, have met with executives of other companies in the real estate industry to discuss industry developments and possible opportunities for transactions. On March 1, 2018, Mr. DuGan and Tyler Henritze, Senior Managing Director in Blackstone's real estate group, had a lunch meeting during which Mr. DuGan and Mr. Henritze discussed developments in the commercial real estate industry and Mr. Henritze expressed Blackstone's interest in a possible acquisition of the Company. Mr. DuGan informed Mr. Henritze that Morgan Stanley was providing financial advisory services to the Company and, following the meeting, Mr. Henritze contacted a representative of Morgan Stanley to reiterate Blackstone's interest in a possible acquisition of the Company. Mr. Henritze informed the representative of Morgan Stanley that Blackstone was principally interested in the Company's industrial portfolio and as a result, in connection with a transaction, would want the right to market certain assets within the Company's portfolio. In response to questions from Mr. Henritze, the representative of Morgan Stanley declined to indicate whether the Company intended to commence a sales process or would be willing to evaluate a pre-emptive proposal from Blackstone in advance of any such process, but indicated that the board would review an indication of interest for a possible transaction if Blackstone submitted a proposal.

        The following week, Mr. Henritze contacted a representative of Morgan Stanley and indicated that Blackstone had conducted substantial due diligence of the Company based on publicly available information and remained interested in a possible acquisition of the Company. Mr. Henritze requested that the Company provide non-public information regarding the Company and its properties, including addresses for its properties, to allow Blackstone to conduct further due diligence, which the Company determined would be premature at that time. In addition, Mr. Henritze reiterated to Mr. DuGan that Blackstone was interested in a possible acquisition of the Company and requested additional due diligence information from the Company.

        On March 20, 2018, a representative of Blackstone contacted a Morgan Stanley representative to inquire about the availability of a non-disclosure agreement to allow a due diligence review of

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non-public information of the Company. In response, the representative of Morgan Stanley indicated that the Company had not determined to provide non-public information and a non-disclosure agreement.

        On March 21, 2018, the transaction committee held a telephonic meeting in which management and representatives of Wachtell Lipton participated. During the meeting, Mr. DuGan provided an update regarding the process of preparing for a possible transaction, including preparations for due diligence, the engagement of advisors in connection with a possible transaction and discussions that had occurred with Blackstone. In addition, the transaction committee discussed a number of other potential transaction counterparties that had been identified by Morgan Stanley as potentially having an interest in an acquisition of an industrial REIT, including Company A, as well as Company B, Company C and Company D (as described below).

        On March 28, 2018, the chief executive officer of a publicly traded REIT operating in the industrial sector (which we refer to as Company B) had a discussion with a representative of Morgan Stanley which was generally unrelated to the Company. During this discussion, the chief executive officer of Company B asked the Morgan Stanley representative whether the Company was considering possible strategic alternatives, although the chief executive officer did not propose that the Company consider a transaction with Company B. The Morgan Stanley representative and the chief executive officer of Company B subsequently held further conversations regarding industry developments, during which the chief executive officer of Company B indicated that Company B would not be interested in acquiring the Company because Company B was seeking to dispose of assets it perceived to be lower-growth, such as those in the Company's portfolio.

        On or about March 29, 2018, a representative of the Company had a discussion with a representative of an investment firm (which we refer to as Company C) regarding a possible transaction involving an asset of the Company. During this discussion, the representative of Company C indicated that while Company C might have an interest in acquiring certain assets or portfolios of assets of the Company, it likely would not have an interest in acquiring the whole company.

        On April 3, 2018, Mr. Henritze contacted a representative of Morgan Stanley to indicate that Blackstone had continued its due diligence of the Company based on publicly available information and to reiterate Blackstone's interest in acquiring the Company. Mr. Henritze further stated that, as a result of Blackstone's strong interest in the Company, recent strategic focus on acquiring industrial real estate assets and large amount of available discretionary capital, Blackstone believed it would be able to pay the highest price of any potential acquiror and a substantial premium, in cash, to our then-current trading price, but that any price would be below the Company's 52-week high share price of $31.26 on October 13, 2017 in light of reduced growth prospects for the Company, the significant subsequent decline in the trading prices of our common shares and REIT prices generally, and transaction expenses that would necessarily be borne by an acquiror of the Company.

        On that same day, a representative of Morgan Stanley and the chief executive officer of Company A discussed a range of topics which were generally unrelated to the Company. During the discussion, the Morgan Stanley representative suggested that an acquisition of the Company was one option that Company A should consider.

        On April 4, 2018, a representative of Morgan Stanley contacted Mr. Henritze to inform him that in light of the interest Blackstone had expressed in a possible acquisition of the Company and the substantial premium that Blackstone indicated it was willing to pay, the Company was prepared to make available to Blackstone certain non-public due diligence information regarding the Company, including corporate and financial information and information for each of the Company's properties, subject to Blackstone entering into an acceptable confidentiality and standstill agreement. The Morgan Stanley representative indicated that the board had not made a determination regarding which, if any, strategic alternative it would seek to effect. He explained that the board had a meeting scheduled for

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April 26, 2018 during which it would discuss possible strategic alternatives, and therefore if Blackstone intended to submit a proposal to acquire the Company, it should consider doing so prior to April 26, 2018.

        On April 7, 2018, representatives of the Company provided a draft confidentiality and standstill agreement to Blackstone. Over the following days, the Company, with the assistance of Wachtell Lipton, and Blackstone, with the assistance of Simpson Thacher & Bartlett LLP, counsel to Blackstone (which we refer to as Simpson Thacher), negotiated the terms of the agreement, which was executed on April 10, 2018.

        On April 9, 2018, the chief executive officer of a publicly traded REIT operating in the industrial sector (which we refer to as Company D) contacted a Morgan Stanley representative. During their discussion in the days thereafter, the chief executive officer of Company D noted the possibility of a transaction involving the Company. During subsequent conversations, the chief executive officer of Company D expressed potential interest in a transaction involving the Company, but also expressed concern about the composition of our portfolio and the size of the Company.

        On April 11, 2018, the Company granted access to an electronic data room to Blackstone and its representatives.

        Later that day, a representative of Morgan Stanley had a discussion with Mr. Jonathan Gray, President of Blackstone, to reiterate that while the Company had not made a determination regarding which, if any, potential strategic alternative we would undertake, the board would be willing to consider a proposal from Blackstone at its upcoming meeting on April 26, 2018.

        On April 13, 2018, the transaction committee held a telephonic meeting, during which it received an update on Blackstone's due diligence process and discussions with representatives of Morgan Stanley and management.

        On April 20, 2018, representatives of Blackstone held a meeting with representatives of the Company, Morgan Stanley and Eastdil for a review of our significant assets, with a focus on our industrial assets.

        Later that day, a representative of Morgan Stanley discussed a range of topics which were generally unrelated to the Company with the chief executive officer of Company A. During this discussion, the representative of Company A stated that while Company A would be interested in acquiring certain smaller portfolios of assets of the Company, it would not be able to offer terms it believed the Company would find acceptable for an acquisition of the Company as a whole in light of our large, mixed portfolio, which included many assets that were not of interest to Company A. The Morgan Stanley representative suggested that Company A should give further consideration to a proposal for an acquisition of the Company as a whole, but the chief executive officer of Company A did not engage in further discussions with representatives of Morgan Stanley regarding a transaction involving the Company.

        In addition, on that same day, the transaction committee held a telephonic meeting, during which it received an update on Blackstone's due diligence process and discussions involving representatives of Morgan Stanley and management.

        On April 25, 2018, a representative of Morgan Stanley discussed a range of topics that were generally unrelated to the Company with the chief executive officer of Company B. During this discussion, the chief executive officer of Company B again stated that Company B would not be interested in an acquisition of the Company.

        In addition, on April 25, 2018, Mr. Henritze contacted a representative of Morgan Stanley to indicate that Blackstone had substantially completed its due diligence and remained interested in a possible acquisition of the Company, for which it intended to submit a proposal later that day.

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Mr. Henritze told the Morgan Stanley representative that Blackstone would insist that the Company move quickly to agree to a transaction and that, although Blackstone believed the Company had a portfolio of high-quality assets, Blackstone had concerns about the long durations of many of our leases and expected future increases in interest rates. The Morgan Stanley representative and Mr. Henritze also discussed expected transaction costs, which Blackstone would factor into its proposed transaction price. Later that day, Mr. Henritze contacted a representative of Morgan Stanley to indicate that Blackstone intended to propose a price of approximately $26.50 per share to acquire all of the common shares of the Company, and that the Company cease paying dividends after signing a merger agreement. In response, the Morgan Stanley representative stated that the board would view Blackstone's proposed price as inadequate, and that Blackstone's proposal should specifically address whether dividends would continue to be permitted to be paid and over what time frame. The Morgan Stanley representative confirmed that the board would be meeting on April 26, 2018. The Morgan Stanley representative also indicated to Blackstone that the Company would be declaring a regularly-scheduled dividend on its common shares for the second quarter on or about April 30, 2018. Mr. Henritze indicated that Blackstone would submit a written proposal the next morning, in advance of the Company's board meeting.

        On April 26, 2018, in discussing a range of topics which were generally unrelated to the Company with a representative of Morgan Stanley, the chief executive officer of Company D expressed that while Company D might have interest in a transaction involving the Company, because of the size and diversification of our portfolio, any acquisition by Company D would likely be at a discount to the sum of the parts of the Company and would require Company D to partner with another purchaser. For these reasons, the chief executive officer of Company D indicated that a transaction with the Company was unlikely to be actionable in the near term for Company D.

        In addition, on April 26, 2018, Blackstone sent a letter to the board in which it proposed to acquire all of the common shares of the Company for $27.00 per share in cash (representing a 19% premium to the April 25, 2018 closing price of $22.64 and a 22% premium to the trailing 30-day volume weighted average price). The letter noted that Blackstone's proposal assumed that the Company would not declare any dividends on its common shares other than its next regularly scheduled dividend. In addition, the letter stated that Blackstone was prepared to complete its confirmatory due diligence and concurrently negotiate a definitive merger agreement within ten business days, and that the transaction would be funded from Blackstone's $15.8 billion fully discretionary Blackstone Real Estate Partners VIII fund and would not be subject to any financing contingency.

        The board held a regularly scheduled in-person meeting later on April 26, 2018. At the meeting, management and representatives of Morgan Stanley reviewed with the board the Company's recent financial and operating performance, presented certain projections of future financial performance prepared by management in connection with the Company's regular planning process and reviewed certain risks and challenges inherent in the Company's standalone plans. Management presented certain potential strategic alternatives, including a possible sale of a portfolio of office and other assets, that the board could consider if it determined not to pursue a sale of the Company. The representatives of Morgan Stanley reviewed with the board the Company's recent common share price performance and updated estimated net asset value prepared by management and analyst estimates of the Company's net asset value, as well as certain preliminary valuation information. Wachtell Lipton reviewed with the trustees their duties in connection with their consideration of potential strategic alternatives for the Company. In addition, the board discussed Blackstone's due diligence process to date and its proposal to acquire the Company for $27.00 per share. The board also considered other potential transaction counterparties and reviewed the discussions that representatives of the Company or Morgan Stanley had engaged in regarding possible strategic transactions involving the Company with representatives of Company A, Company B, Company C and Company D, as well as a potential transaction involving a disposition of a portfolio of office and other assets to a third party. Based on

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these discussions, the board considered the significant uncertainty as to whether any other party would propose to acquire the Company at a value at or greater than the value proposed by Blackstone. At the conclusion of the meeting, the board directed Morgan Stanley to inform Blackstone that the board was not prepared to pursue a transaction with Blackstone at $27.00 per share in order to determine whether Blackstone would be willing to increase the proposed price.

        Following the board meeting, a representative of Morgan Stanley informed Mr. Henritze that the Company was not prepared to move forward at Blackstone's proposed price, and suggested that if Blackstone determined to submit a revised proposal with a higher price, it should specify any restrictions regarding dividend payments by the Company and indicate its remaining due diligence requirements. During this conversation, Mr. Henritze inquired about the Company's expectations for deal protection terms, and the representative of Morgan Stanley indicated that such a discussion was premature in light of the fact that the Company was not prepared to enter into a transaction at that time at the price proposed by Blackstone.

        In addition, on April 26, 2018, representatives of Morgan Stanley provided management and Wachtell Lipton with certain disclosures of Morgan Stanley regarding fees it had received or may in the future receive from the Company and its affiliates, or Blackstone and its affiliates, and Morgan Stanley's ownership of common equity of the Company, Blackstone and such affiliates, which was subsequently updated and delivered to the board prior to the execution of the merger agreement.

        On April 27, 2018, Mr. Henritze contacted a representative of Morgan Stanley to indicate that Blackstone was prepared to increase its proposed price to $27.30 per share, with the Company being permitted to pay a quarterly dividend only with respect to the second quarter of 2018, or alternatively, Blackstone would pay $27.00 per common share with no restrictions on the Company's ability to continue paying regular quarterly dividends prior to the closing of the transaction. Mr. Henritze also proposed that the Company would be subject to customary prohibitions on soliciting alternative proposals, the termination fee that would be payable by the Company under certain circumstances would equal 3% of transaction equity value, and the reverse termination fee payable by Blackstone under certain circumstances would equal 6% of transaction equity value. He also indicated that Blackstone would request the right to market certain of our assets prior to the closing of Blackstone's acquisition of the Company, with the closing of any such sales conditioned on the closing of the acquisition of the Company. In discussing this proposal, representatives of Morgan Stanley suggested to Mr. Henritze that the Company should have the right to solicit alternative transaction proposals for a limited period following the execution of a merger agreement and, over the course of these discussions, Blackstone revised its proposal to provide that the termination fee payable by the Company under certain circumstances would be equal to 1.5% of transaction equity value for an initial 30-day post-signing period and would thereafter increase to 3% of transaction equity value, and the termination fee payable by Blackstone under certain circumstances would be equal to 9% of transaction equity value. Mr. Henritze also indicated that Blackstone had very limited remaining due diligence requirements.

        Later on April 27, 2018, the board held a special telephonic meeting at which representatives of Morgan Stanley provided an update regarding Blackstone's revised proposal and Wachtell Lipton reviewed with the trustees their duties in connection with their consideration of a possible transaction.

        On April 28, 2018, the board held a special telephonic meeting to continue to review and consider Blackstone's proposal. The board considered the revised terms proposed by Blackstone, which provided for an acquisition of the Company at a significant premium to its closing price of $23.30 on April 27, 2018 and a premium to the mean analyst estimate of the Company's net asset value of $26.20 per share as of April 20, 2018. The board also considered Blackstone's strategy of acquiring industrial real estate assets as well as its substantial available capital, and discussed whether Blackstone was the potential transaction partner likely to pay the highest value to acquire the Company and whether Blackstone

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would pay a higher price than it was offering at that time. In addition, the board considered the fact that certain possible transaction counterparties had discussed potential interest in a transaction involving the Company or part of its portfolio with representatives of management or Morgan Stanley, but indicated they did not expect to be able to acquire the Company or to propose terms that would be acceptable to the Company. The board also discussed whether the Company should contact additional potential transaction counterparties to determine their interest in acquiring the Company, but noted the limited number of potential purchasers with the financial capacity, business strategy and track record in acquiring publicly traded REITs as a whole and, furthermore, the ability to acquire the Company in light of its size and the diversification of its portfolio, as well as the risk that soliciting other potential buyers could jeopardize the availability of Blackstone's proposal. After extensive deliberation, the board determined that Blackstone was the potential acquirer likely to pay the highest price and that the Company should pursue the potential transaction with Blackstone but should seek a higher price per common share and with terms that would allow the Company to solicit alternative acquisition proposals following execution of the merger agreement.

        Later that day, after a representative of Morgan Stanley conveyed the board's response to Mr. Henritze, Mr. Henritze contacted the representative of Morgan Stanley to indicate that Blackstone was not willing to agree to a provision allowing the Company to solicit alternative acquisition proposals following execution of the merger agreement, but that Blackstone would increase its proposed transaction price to $27.50 per share and agree to a lower 1% termination fee payable by the Company in connection with entry into an unsolicited alternative acquisition proposal received during the first 45 days following the execution of the merger agreement. Blackstone requested certain remaining due diligence information and the right to market certain of our properties during the pre-closing period. Later that day, Blackstone submitted a letter confirming its proposal to acquire all of the common shares of the Company for $27.50 per share in cash (representing an 18% premium to the April 27, 2018 closing price of $23.30 and a 24% premium to the trailing 30-day volume weighted average price), and which assumed that the Company would not pay any dividends on its common shares other than its next regularly-scheduled dividend.

        Thereafter, on that same day, following the discussion between Mr. Henritze and the representative of Morgan Stanley and the delivery of Blackstone's letter, the board held a second telephonic meeting to consider Blackstone's revised proposal. The board determined that in light of the increased price of $27.50 per share proposed by Blackstone, management and the Company's advisors should proceed with negotiations on the proposed terms and should provide Blackstone with the additional due diligence information it had requested and the right to market certain of the Company's properties for sale, provided that the completion of any such sales would be conditioned on the closing of the acquisition of the Company by Blackstone or otherwise would require the consent of the Company. In addition, the board authorized Wachtell Lipton to provide a draft merger agreement to Blackstone's representatives and, on April 29, 2018, Wachtell Lipton sent a draft merger agreement to Simpson Thacher. The draft contemplated providing eligible holders of OP Units with the opportunity to elect to convert their Class A partnership units into new Series B preferred units of the Partnership on a one-for-one basis, with non-electing or ineligible holders receiving the same cash merger consideration payable to our common shareholders.

        On May 1, 2018, Simpson Thacher sent Wachtell Lipton a draft of the equity commitment letter and limited guaranty to be executed by the Sponsor. In the draft guaranty, the maximum aggregate liability of the Sponsor was capped at the amount of the Parent termination fee, plus all reasonable and documented third party costs and out-of-pocket expenses incurred by the Company relating to any litigation or other proceeding brought by the Company to enforce its rights under the guaranty. In addition, later that day, Simpson Thacher sent Wachtell Lipton a draft of the partnership agreement amendment setting forth Blackstone's proposed terms for the Series B preferred units to be issued to holders of Class A partnership units who exercise the rollover option.

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        Over the course of the following days, the Company provided Blackstone and its representatives with additional due diligence information and the Company, with the assistance of Morgan Stanley and Wachtell Lipton, and Blackstone, with the assistance of Simpson Thacher, negotiated the terms of the merger agreement and the other transaction documents. These negotiations covered various aspects of the transaction, including, among other things: the representations and warranties to be made by the parties; the restrictions on the conduct of the Company's business until completion of the transaction; the Company's right to participate in discussions or negotiations with third parties relating to unsolicited acquisition proposals; the Company's right to terminate the merger agreement to accept a superior proposal under certain conditions; the other termination provisions and the triggers of the termination fee payable by the Company; the provisions regarding the Company's equity awards, employee benefit plans, severance and other compensation matters; the remedies available to each party under the merger agreement; Blackstone's right to delay the closing of the transaction to October 10, 2018; the provision of additional consideration at a per diem rate of approximately $0.004 per day, equivalent to a daily ratable portion of the Company's regular quarterly dividend per common share, if the transaction were to close after October 15, 2018; and the terms of the Series B preferred units.

        On May 3, 2018, the board held a special telephonic meeting, during which a representative of Morgan Stanley reviewed the terms of the transaction announced on April 29, 2018, by Prologis, Inc. (which we refer to as Prologis) and DCT Industrial Trust Inc. (which we refer to as DCT), pursuant to which Prologis would acquire DCT in a stock-for-stock transaction (which we refer to as the Prologis-DCT transaction). The board considered the impact of the Prologis-DCT transaction on the Blackstone proposal, noting that the price that Blackstone proposed to pay to acquire the Company represented higher premiums to our unaffected, 30-day and 60-day volume-weighted average prices per common share compared to the analogous premiums in the Prologis-DCT transaction and that the consideration payable under the Blackstone proposal was all cash. In addition, during the telephonic meeting, the board reviewed certain disclosures of Morgan Stanley regarding fees it had received or may in the future receive from the Company and its affiliates, or Blackstone and its affiliates, and Morgan Stanley's ownership of common equity of the Company, Blackstone and such affiliates. Representatives of Wachtell Lipton also reviewed with the board certain terms under negotiation in the merger agreement and related transaction documents, as well as the terms of the Series B preferred units to be offered to holders of Class A partnership units (other than the Company) and proposed severance arrangements to be adopted for Company employees in connection with the potential transaction.

        On May 5 and 6, 2018, representatives of Blackstone, with the assistance of Simpson Thacher, and representatives of the Company, with the assistance of Morgan Stanley and Wachtell Lipton, negotiated and resolved the remaining open terms and finalized the merger agreement and other transaction documents.

        On the evening of May 6, 2018, the board held a special meeting during which management and representatives of Morgan Stanley and Wachtell Lipton reviewed the history of negotiations with Blackstone and the terms of the proposal by Blackstone. Management and the representatives of Morgan Stanley also discussed the likelihood or unlikelihood of a third party offering to acquire the Company at a value at or above $27.50 per common share, and discussed the potential opportunities and risks associated with rejecting Blackstone's proposal and remaining a standalone entity or pursuing other strategic alternatives or discussions with other third parties at that time. In addition, the board reviewed disclosures from Morgan Stanley regarding fees it had received or may receive in the future receive from the Company and its affiliates, or Blackstone and its affiliates, and Morgan Stanley's ownership of common equity of the Company, Blackstone and such affiliates. The representatives of Morgan Stanley provided an updated financial presentation regarding the final proposal from Blackstone and a valuation analysis of the Company and then delivered to the board Morgan Stanley's

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oral opinion, subsequently confirmed in writing, that, as of such date and based upon and subject to the various limitations and assumptions set forth in the opinion, the merger consideration to be received by holders of Company common shares pursuant to the merger agreement was fair from a financial point of view to such holders. At the meeting, representatives of Wachtell Lipton provided a presentation regarding the terms of the draft merger agreement and other transaction documents and reviewed with the trustees their duties in connection with their consideration and potential approval of the transaction with Blackstone. The board also discussed the interests of our directors and executive officers in the mergers that are different from, or in addition to, those of our shareholders generally, including their ownership of restricted share awards, Company RSU awards, Company options and Company LTIP units, and the opportunity offered by Blackstone, subject to certain conditions, for holders of Class A partnership units (including Company LTIP units) to exchange their Class A partnership units for Series B preferred units of the Surviving Partnership. Consideration was also given to the fact that senior management had indicated they did not have any agreements or understandings, and had not engaged in discussions, with Blackstone regarding their potential post-closing employment arrangements. Following extensive discussion, the board unanimously approved the merger agreement, declared the merger agreement and the transactions contemplated by the merger agreement, including the merger, to be advisable and in the best interests of the Company and our shareholders, and determined to recommend the approval of the merger and the other transactions contemplated by the merger agreement by our shareholders. In addition, the board approved a draft press release to be issued in connection with the transaction.

        Following the board's approval, the parties finalized and executed the merger agreement and other transaction documents during the evening of May 6, 2018. On May 7, 2018, the Company issued a press release announcing entry into the merger agreement.

Reasons for the Mergers

        In reaching its decision to approve the merger agreement, declare the merger agreement and the transactions contemplated by the merger agreement, including the merger, to be advisable and in the best interests of the Company and our shareholders and to recommend approval of the merger and the other transactions contemplated by the merger agreement to our shareholders, the board consulted with the Company's senior management team, as well as our financial and legal advisors, and considered a number of factors, including the following material factors which the board viewed as supporting its decision to approve the merger agreement, declare the merger agreement and the transactions contemplated by the merger agreement, including the merger, to be advisable and in the best interests of the Company and our shareholders and to recommend approval of the merger and the other transactions contemplated by the merger agreement to our shareholders

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        The board also considered the following potentially negative factors in its consideration of the merger agreement and the merger:

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        The foregoing discussion of the factors considered by the board is not intended to be exhaustive, but rather includes the material factors considered by the board. In reaching its decision approve the merger agreement, declare the merger agreement and the transactions contemplated by the merger agreement, including the merger, to be advisable and in the best interests of the Company and our shareholders and to recommend approval of the merger and the other transactions contemplated by the merger agreement to our shareholders, the board did not quantify or assign any relative weights to, and did not make specific assessments of, the factors considered, and individual trustees may have given different weights to different factors. The board did not reach any specific conclusion with respect to any of the factors or reasons considered.

        The above factors are not presented in any order of priority. The explanation of the factors and reasoning set forth above contain forward-looking statements and should be read in conjunction with the section of this proxy statement entitled "Cautionary Statement Regarding Forward-Looking Statements."

Recommendation of Our Board of Trustees

        Our board of trustees has unanimously approved the merger agreement and declared the merger agreement and the transactions contemplated by the merger agreement, including the merger, to be advisable and in the best interests of the Company and our shareholders. Our board of trustees

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recommends that you vote "FOR" the proposal to approve the merger and the other transactions contemplated by the merger agreement, "FOR" the proposal to approve, on a non-binding, advisory basis, the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger and "FOR" the proposal to approve any adjournment of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to approve the merger and the other transactions contemplated by the merger agreement.

Forward-Looking Financial Information

        As a matter of general practice, due to the unpredictability of the underlying assumptions and estimates inherent in preparing financial projections, we do not publicly disclose detailed projections as to our anticipated financial position or results of operations, other than providing, from time to time, estimated ranges for the then- current fiscal year of certain expected financial results and operational metrics in our regular earnings press releases and other investor materials.

        However, in connection with the evaluation of a possible transaction, our management prepared and provided to our board of trustees certain forward-looking financial information for the Company on a consolidated basis for each of the four fiscal quarters in 2018 (which we refer to as the 2018 projected financial information) and certain forward-looking financial information for the Company on a consolidated basis for 2019 through 2024 (which we refer to as the 2019 through 2024 projected financial information), which is summarized below. Such projections (as well as updated forward-looking financial information for the Company on a consolidated basis for each of the last three fiscal quarters in 2018 prepared by our management following the completion of the quarter ended March 31, 2018, which we refer to as the updated 2018 projected financial information) were also provided to Morgan Stanley for use in connection with its financial analyses and fairness opinions as well as to our board of trustees. In addition, the initial, but not the updated, 2018 projected financial information was provided to Blackstone in connection with its due diligence review.

        These financial projections were not intended for public disclosure, and, accordingly, do not necessarily comply with published guidelines of the SEC, the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of financial forecasts or generally accepted accounting principles, or GAAP. Neither our independent registered public accounting firm nor any other independent accountants have audited, compiled or performed any procedures with respect to the projections nor expressed an opinion or any form of assurance on the financial projections or their achievability, and they assume no responsibility for, and disclaim any association with, such financial projections. A summary of the financial projections is included in this proxy statement only because the financial projections were made available to our board of trustees, Morgan Stanley and Blackstone as described in this proxy statement. The inclusion of the financial projections in this proxy statement does not constitute an admission or representation by us that the information is material.

        In the view of our management, the financial projections were prepared on a reasonable basis reflecting management's best available estimates and judgments regarding our future financial performance at the time they were prepared. The financial projections have been included only to reflect information made available at the time of certain events and decisions to our board of trustees, Morgan Stanley and Blackstone, are not facts and should not be relied upon as indicative of actual future results, and you are cautioned not to rely on the financial projections. Some or all of the assumptions that have been made in connection with the preparation of the financial projections may have changed since the date the financial projections were prepared. None of the Company, Blackstone nor any of our or their respective affiliates, advisors or other representatives assumes any responsibility for the validity, reasonableness, accuracy or completeness of the financial projections. None of the Company, Blackstone nor any of their respective affiliates has or intends to, and each of them disclaims

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any obligation to, update, revise or correct the financial projections if any or all of them have become or become inaccurate (even in the short term) since the time of their preparation. These considerations should be taken into account in reviewing the financial projections, which were prepared as of an earlier date.

        The financial projections do not reflect changes in general business or economic conditions since the time they were prepared, changes in our businesses or prospects since the time they were prepared, or any other transaction or event that has occurred or that may occur and that was not anticipated at the time the financial projections were prepared, and the financial projections are not necessarily indicative of current values or future performance, which may be significantly more favorable or less favorable than as set forth below and should not be regarded as a representation that the financial forecasts will be achieved. The projections also reflect assumptions as to certain business decisions that are subject to change. In addition, our future financial performance may be affected by our ability to successfully implement a number of initiatives to improve our operations and financial performance and our ability to achieve strategic goals, objectives and targets over the applicable periods.

        Because the financial projections reflect subjective judgment in many respects, they are susceptible to multiple interpretations and frequent revisions based on actual experience and business developments. The financial projections also cover multiple years, and such information by its nature becomes less predictive with each succeeding year. The financial projections constitute forward-looking information and are subject to a wide variety of significant risks and uncertainties that could cause the actual results to differ materially from the projected results. For additional information on factors that may cause our future financial results to materially vary from the projected results summarized below, see the section entitled "Cautionary Statement Regarding Forward-Looking Statements," beginning on page 24. Accordingly, there can be no assurance that the projected results summarized below will be realized or that actual results will not differ materially from the projected results summarized below, and the financial projections cannot be considered a guarantee of future operating results and should not be relied upon as such. Neither we nor our affiliates or advisors or any other person has made any representation to any of our shareholders or any other person regarding our actual performance compared to the results included in the financial projections. We have not made any representation to Blackstone or its affiliates, in the merger agreement or otherwise, concerning the projections.

        The financial projections should be evaluated, if at all, in conjunction with the historical financial statements and other information contained in our public filings with the SEC. The financial projections do not take into account any circumstances or events occurring after the date they were prepared, including the mergers. Further, the financial projections do not take into account the effect of any failure of the mergers to be consummated and should not be viewed as accurate or continuing in that context.

Financial Projections

        The following table summarizes the financial projections of the Company on a consolidated basis that were provided to our board of trustees, Morgan Stanley and Blackstone in connection with the evaluation of a possible transaction.

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Summary of the 2018 Projected Financial Information

 
  Projections(1)  
Calendar Year
Quarter Ending
  2018
3/31/18(2)
  2018
6/30/18
  2018
9/30/18
  2018
12/31/18
  2018E  

Income Statement

                               

Rental Revenue—Cash

  $ 112   $ 113   $ 113   $ 115   $ 453  

Total Revenues

  $ 148   $ 145   $ 144   $ 146   $ 583  

Total Operating Expenses

  $ (107 ) $ (107 ) $ (104 ) $ (104 ) $ (423 )(4)

Net Income

  $ 29   $ 12   $ 43   $ 14   $ 97 (4)

Core Funds From Operations Attributable to Common Shareholders and Unitholders(3)

  $ 86   $ 83   $ 82   $ 82   $ 334 (4)

Adjusted Funds From Operations Attributable to Common Shareholders and Unitholders(3)

  $ 81   $ 78   $ 79   $ 80   $ 317 (4)

Per Share Metrics

                               

Core FFO per Share—Diluted(3)

  $ 0.52   $ 0.50   $ 0.49   $ 0.49   $ 2.00  

AFFO per Share—Diluted(3)

  $ 0.49   $ 0.47   $ 0.47   $ 0.47   $ 1.90  

Diluted weighted average common shares and units outstanding

    165.9     166.8     167.1     168.4     166.8  

(1)
Dollar and share amounts in millions, except per share data.

(2)
These projections for the fiscal quarter ended March 31, 2018 were prepared in early April 2018 prior to the public availability of the actual results of operations for such quarter. You should review the Company's Quarterly Report on Form 10-Q to obtain the actual results of operations. See the section entitled "Where You Can Find More Information." The actual results of operations are also reflected in the table below.

(3)
We use core funds from operations, or Core FFO, and adjusted funds from operations, or AFFO, available to common shares and partnership units because we consider them to be important supplemental measures of our operating performance and believe they are frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present Core FFO and AFFO when reporting their results. Core FFO and AFFO are intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. Because Core FFO and AFFO exclude depreciation and amortization unique to real estate, gains and losses from property dispositions and extraordinary items, they provide performance measures that, when compared year over year, reflect the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities and interest costs, providing perspective not immediately apparent from net income. We compute funds from operations, or FFO, in accordance with standards established by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT. As defined by NAREIT, FFO represents net income (loss) (computed in accordance with GAAP), excluding impairment write-downs of investments in depreciable real estate and investments in in-substance real estate investments and sales of depreciable operating properties, plus real estate-related depreciation and amortization (excluding amortization of deferred financing costs), less distributions to noncontrolling interests and gains/losses from discontinued operations and after adjustments for unconsolidated partnerships and joint ventures.

Core FFO and AFFO are Company defined measures. Core FFO is presented excluding transaction costs, gain (loss) on extinguishment of debt, other-than-temporary impairments on retained bonds, mark-to-market on interest rate swaps, and one-time charges. AFFO of the Company also excludes non-cash share-based compensation expense, amortization of market lease

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(4)
Rounding error.

        Following the completion of the quarter ended March 31, 2018, our management prepared updated financial projections of the Company on a consolidated basis that were provided to Morgan Stanley for use in connection with its financial analyses and fairness opinions, as well as our board of trustees.


Summary of the Updated 2018 Projected Financial Information

 
  Actuals   Projections(1)  
Calendar Year
Quarter Ending
  2018
3/31/18
  2018
6/30/18
  2018
9/30/18
  2018
12/31/18
  2018E  

Income Statement

                               

Rental Revenue—Cash

  $ 115   $ 113   $ 110   $ 111   $ 448 (4)

Total Revenues

  $ 149   $ 144   $ 141   $ 143   $ 578 (4)

EBITDA(2)

  $ 116   $ 114   $ 113   $ 114   $ 457  

Total Operating Expenses

  $ (111 ) $ (106 ) $ (103 ) $ (101 ) $ (421 )

Net Income

  $ 28   $ 7   $ 57   $ 15   $ 107  

Core Funds From Operations Attributable to Common Shareholders and Unitholders(3)

  $ 85   $ 82   $ 82   $ 82   $ 331  

Adjusted Funds From Operations Attributable to Common Shareholders and Unitholders(3)

  $ 80   $ 79   $ 78   $ 78   $ 315  

Per Share Metrics

                               

Core FFO per Share—Diluted(3)

  $ 0.51   $ 0.49   $ 0.49   $ 0.49   $ 1.99  

AFFO per Share—Diluted(3)

  $ 0.49   $ 0.47   $ 0.47   $ 0.47   $ 1.89  

Diluted weighted average common shares and units outstanding

    165.8     166.7     166.8     166.8     166.5  

(1)
Dollar and share amounts in millions, except per share data.

(2)
We compute EBITDA as net income (loss) (determined in accordance with GAAP), excluding impairment write-downs of investments in depreciable real estate and investments in in-substance real estate investments and sales of depreciable operating properties, plus (i) interest expense, (ii) provision for federal, state, local and foreign income taxes payable, (iii) real estate-related depreciation and amortization (excluding amortization of deferred financing costs), (iv) non-cash share-based compensation, (v) gains and losses attributable to the early extinguishment of indebtedness, (vi) other-than-temporary impairments on retained CDO bonds, (vii) transaction costs, (viii) impairment of real estate investments, and (ix) amortization of free rent receive at property acquisitions, less (i) distributions to noncontrolling interests, (ii) gains and losses from discontinued operations, and (iii) net gains on disposals. EBITDA is adjusted to include the

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(3)
We use core funds from operations, or Core FFO, and adjusted funds from operations, or AFFO, available to common shares and partnership units because we consider them to be important supplemental measures of our operating performance and believe they are frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present Core FFO and AFFO when reporting their results. Core FFO and AFFO are intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. Because Core FFO and AFFO exclude depreciation and amortization unique to real estate, gains and losses from property dispositions and extraordinary items, they provide performance measures that, when compared year over year, reflect the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities and interest costs, providing perspective not immediately apparent from net income. We compute funds from operations, or FFO, in accordance with standards established by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT. As defined by NAREIT, FFO represents net income (loss) (computed in accordance with GAAP), excluding impairment write-downs of investments in depreciable real estate and investments in in-substance real estate investments and sales of depreciable operating properties, plus real estate-related depreciation and amortization (excluding amortization of deferred financing costs), less distributions to noncontrolling interests and gains/losses from discontinued operations and after adjustments for unconsolidated partnerships and joint ventures.

Core FFO and AFFO are Company defined measures. Core FFO is presented excluding transaction costs, gain (loss) on extinguishment of debt, other-than-temporary impairments on retained bonds, mark-to-market on interest rate swaps, and one-time charges. AFFO of the Company also excludes non-cash share-based compensation expense, amortization of market lease intangibles, amortization of deferred financing costs and non-cash interest, amortization of free rent received at property acquisition, straight-line rent, and other adjustments including non-real estate depreciation and amortization and straight-line rent related to corporate office leases.

Our computations may differ from the methodologies for calculating Core FFO and AFFO utilized by other equity REITs and, accordingly, may not be comparable to such other REITs. Core FFO and AFFO should not be considered alternatives to net income/(loss) (computed in accordance with GAAP) as indicators of our financial performance or to cash flow from operating activities as measures of our liquidity, nor are they indicative of funds available to fund our cash needs, including our ability to pay make cash distributions. Core FFO and AFFO should be considered only as supplements to net income computed in accordance with GAAP as measures of our operations.

(4)
Rounding error.

        The following table summarizes the financial projections of the Company on a consolidated basis that were provided to our board of trustees and Morgan Stanley in connection with the evaluation of a possible transaction.

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Summary of the 2019 through 2024 Projected Financial Information

 
  Projections(1)  
 
  12 Months Ending  
 
  6/30/19   6/30/20   6/30/21   6/30/22   6/30/23   6/30/24  

Income Statement

                                     

NTM Cash NOI(2)

  $ 438   $ 451   $ 463   $ 473   $ 484   $ 497  

Less: MG&A(3)

  $ (38 ) $ (40 ) $ (42 ) $ (44 ) $ (46 ) $ (48 )

Less: Tenant Improvements

  $ (10 ) $ (20 ) $ (16 ) $ (21 ) $ (30 ) $ (16 )

Less: Leasing Commissions

  $ (6 ) $ (11 ) $ (10 ) $ (13 ) $ (15 ) $ (14 )

Less: Capital Reserves

  $ (5 ) $ (5 ) $ (5 ) $ (6 ) $ (6 ) $ (6 )

Unlevered Free Cash Flows

  $ 379   $ 375   $ 390   $ 390   $ 387   $ 413  

(1)
Dollar amounts in millions.

(2)
We believe that net operating income on a cash basis, which we refer to as cash NOI (and which only applies to properties), is helpful to investors as an additional measure of operating performance because it eliminates straight-line rent, amortization of lease incentives, above and below market amortization on acquired leases. Cash NOI presented by us may not be comparable to cash NOI reported by other REITs that define cash NOI differently. Cash NOI should not be considered as an alternative to net income as an indication of our performance or to cash flows as a measure of liquidity or ability to make distributions. Next twelve months cash net operating income or NTM Cash NOI is a forward-looking projection of the property revenues, expenses and reimbursements on a cash basis before interest and capital reserves or expenditures.

(3)
Based on Company estimated management, general and administrative expense, or MG&A, for 2018, grown at 5.0% per year thereafter.

        Certain of the above financial projections above were not prepared in accordance with GAAP, including Cash NOI, EBITDA, Core FFO and AFFO. We use these non-GAAP financial measures in analyzing our financial results and believe that they enhance investors' understanding of our financial performance and the comparability of our results to prior periods, as well as against the performance of REITs. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. The Company's calculation of non-GAAP financial measures may differ from others in the industry and NOI, EBITDA, Core FFO and AFFO are not necessarily comparable with similar titles used by other companies. The non-GAAP financial measures used in the financial projections were relied upon by Morgan Stanley for purposes of its fairness opinion and by the board of trustees in connection with its consideration of the mergers. Financial measures provided to a financial advisor are excluded from the definition of non-GAAP financial measures and therefore are not subject to SEC rules regarding disclosures of non-GAAP financial measures, which would otherwise require a reconciliation of a non-GAAP financial measure to a GAAP financial measure. Reconciliations of non-GAAP financial measures were not relied upon by Morgan Stanley for purposes of its fairness opinion or by the board of trustees in connection with its consideration of the mergers. Accordingly, we have not provided a reconciliation of the financial measures included in the financial projections above.

        We do not intend to update or otherwise revise the above financial projections to reflect circumstances existing after the date when they were prepared or to reflect the occurrence of future events, even in the event that any or all of the assumptions underlying such unaudited prospective financial information are no longer appropriate.

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Opinion of Our Financial Advisor

Opinion of Morgan Stanley

        We retained Morgan Stanley to provide us with financial advisory services in connection with the proposed merger. We selected Morgan Stanley to act as our financial advisor based on Morgan Stanley's qualifications, expertise and reputation, and its knowledge of the business and affairs of the Company. As part of this engagement, our board of trustees requested that Morgan Stanley evaluate the fairness from a financial point of view of the merger consideration to be received by the holders of common shares pursuant to the merger agreement. On May 6, 2018, at a meeting of our board of trustees, Morgan Stanley rendered its oral opinion, subsequently confirmed in writing by delivery of a written opinion to our board of trustees dated May 6, 2018, that, as of that date and based upon and subject to the various assumptions made, procedures followed, matters considered and qualifications and limitations on the scope of review undertaken by Morgan Stanley as set forth in the written opinion, the merger consideration to be received by the holders of our common shares pursuant to the merger agreement was fair from a financial point of view to such holders of our common shares.

        The full text of the written opinion of Morgan Stanley, dated as of May 6, 2018, is attached to this proxy statement as Exhibit B and is hereby incorporated into this proxy statement by reference in its entirety. You should read the opinion in its entirety for a discussion of the assumptions made, procedures followed, matters considered and qualifications and limitations on the scope of the review undertaken by Morgan Stanley in rendering its opinion. We encourage you to read the entire opinion and the summary of Morgan Stanley's opinion below carefully and in their entirety. This summary of the opinion of Morgan Stanley set forth in this proxy statement is qualified in its entirety by reference to the full text of the opinion. Morgan Stanley's opinion is directed to our board of trustees, in its capacity as such, addresses only the fairness of the merger consideration to be received by the holders of our common shares pursuant to the merger agreement from a financial point of view to such holders as of the date of the opinion and does not address any other aspects or implications of the mergers. Morgan Stanley's opinion was not intended to, and does not, constitute a recommendation to any holder of our common shares as to how to vote at the special meeting to be held in connection with the mergers or whether to take any other action with respect to the mergers. Morgan Stanley was not requested to opine as to, and its opinion did not in any manner address the relative merits of, the transactions contemplated by the merger agreement as compared to other business or financial strategies that might be available to the Company, nor did it address the underlying business decision of the Company to enter into the merger agreement or proceed with any other transaction contemplated by the merger agreement.

        In connection with rendering its opinion, Morgan Stanley, among other things:

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        In arriving at its opinion, Morgan Stanley assumed and relied upon, without independent verification, the accuracy and completeness of the information that was publicly available or supplied or otherwise made available to it by the Company, and formed a substantial basis for its opinion. With respect to the financial projections, Morgan Stanley assumed that they had been reasonably prepared on bases reflecting the best currently available estimates and judgments of our management of the future financial performance of the Company, including the potential impact of recent changes in the U.S. tax laws and regulations pursuant to H.R. 1, Tax Cuts and Jobs Act, enacted on December 22, 2017 (the "Tax Cuts and Jobs Act") on the future financial performance of the Company, as to which Morgan Stanley expressed no view or opinion. Morgan Stanley noted that (i) the actual and estimated financial and operating performance and the share price data that it reviewed for the companies with publicly traded equity securities and that it deemed to be relevant and (ii) the financial terms of certain acquisition transactions that it deemed relevant might not, in whole or in part, reflect the potential impact of the Tax Cuts and Jobs Act. In addition, Morgan Stanley assumed that the mergers will be consummated in accordance with the terms set forth in the merger agreement without any waiver, amendment or delay of any terms or conditions, including, among other things, that Parent will obtain the financing required to consummate the mergers and that the definitive merger agreement will not differ in any material respect from the draft thereof furnished to Morgan Stanley. Morgan Stanley assumed that in connection with the receipt of all the necessary governmental, regulatory or other approvals and consents required for the proposed mergers, no delays, limitations, conditions or restrictions will be imposed that would have a material adverse effect on the contemplated benefits expected to be derived in the proposed mergers. Morgan Stanley did not express any view on, and its opinion did not address, any other term or aspect of the merger agreement or the transactions contemplated thereby or any term or aspect of any other agreement or instrument contemplated by the merger agreement or entered into or amended in connection therewith. Morgan Stanley is not a legal, tax or regulatory advisor. Morgan Stanley is a financial advisor only and relied upon, without independent verification, the assessment of the Company and its legal, tax or regulatory advisors with respect to legal, tax or regulatory matters. Morgan Stanley expressed no opinion with respect to the fairness of the amount or nature of the compensation to any of our officers, directors or employees, or any class of such persons, relative to the merger consideration to be received by the holders of our common shares in the mergers. Morgan Stanley did not make any independent valuation or appraisal of the assets or liabilities of the Company, nor was it furnished with any such valuations or appraisals. Morgan Stanley's opinion was necessarily based on financial, economic, market, tax and other conditions as in effect on, and the information made available to it as of, the date of its opinion. Events occurring after such date may affect Morgan Stanley's opinion and the assumptions used in preparing it, and Morgan Stanley did not assume any obligation to update, revise or reaffirm its opinion.

Summary of Financial Analyses of Morgan Stanley

        The following is a summary of the material financial analyses performed by Morgan Stanley in connection with its oral opinion and the preparation of its written opinion letter to our board of trustees dated May 6, 2018. The following summary is not a complete description of the financial

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analyses performed and factors considered by Morgan Stanley in connection with its opinion, nor does the order of analyses described represent the relative importance or weight given to those analyses. Some of these summaries of financial analyses include information presented in tabular format. In order to fully understand the financial analyses used by Morgan Stanley, the tables must be read together with the text of each summary. The tables alone do not constitute a complete description of the financial analyses. The analyses listed in the tables and described below must be considered as a whole. Assessing any portion of such analyses and of the factors reviewed, without considering all analyses and factors, could create a misleading or incomplete view of the process underlying Morgan Stanley's opinion. Furthermore, mathematical analysis (such as determining the average or median) is not in itself a meaningful method of using the data referred to below.

        For purposes of Morgan Stanley's opinion and the analyses described below, the merger consideration was assumed to be $27.50 per share in cash and did not take into account any additional consideration of approximately $0.004 in cash for each day from and including October 15, 2018 until (but not including) the closing date, if the mergers are consummated after October 15, 2018.

Research Analyst Price Targets and NAV Targets

        Morgan Stanley reviewed available public market trading price targets for our common shares by the ten equity research analysts that provided a price target for the Company prior to May 3, 2018. Morgan Stanley reviewed the most recent price target published by the analysts prior to such date. These targets reflect each analyst's estimate of the future public market trading price of our common shares at the time the price target was published. Based on this review and after excluding the highest and lowest analyst price target, Morgan Stanley noted that the equity research analysts had the following range of price targets, as compared to the merger consideration of $27.50 per share:

Research Analyst Price Targets
  Per Share Merger Consideration
$25.00 to $30.00   $27.50

        Morgan Stanley also reviewed available equity research analyst estimates of net asset value (which we also refer to as NAV) per common share of the company prior to May 3, 2018. Morgan Stanley reviewed the most recent estimates of net asset value published by the same ten analysts prior to such date. Based on this review and after excluding the highest and lowest analyst net asset value, Morgan Stanley noted that the equity research analysts had the following range of estimates of net asset value per common share of the Company, as compared to the merger consideration of $27.50 per share:

Research Analyst NAV Per Share Estimates
  Per Share Merger Consideration
$24.50 to $27.24   $27.50

        The public market trading price targets and estimates of net asset value per share published by securities research analysts do not necessarily reflect current market trading prices for our common shares and these targets and estimates are subject to uncertainties, including the future financial performance of the Company and future financial market conditions.

Comparable Public Companies Analysis

        Morgan Stanley reviewed and compared certain publicly available and internal financial information, publicly available and internal ratios and publicly available market multiples relating to the Company with equivalent publicly available data for companies that share similar business characteristics with the Company to derive an implied equity value reference range for the Company. Morgan Stanley reviewed the following publicly-traded companies (which we refer to as selected companies): Lexington Realty Trust, Monmouth Real Estate Investment Corporation, STAG Industrial, Inc., W.P. Carey Inc. and VEREIT, Inc.

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        For purposes of this analysis, Morgan Stanley analyzed certain statistics for each of these companies for comparison purposes, including the ratios of share price to consensus Wall Street research analyst (which we refer to as Street consensus) estimated funds from operations, which we refer to as FFO, for calendar year 2018, share price to Street consensus estimated adjusted funds from operations, which we refer to as AFFO, for calendar year 2018, and aggregate value to Street consensus estimated earnings before interest, taxes, depreciation and amortization, which we refer to as EBITDA, for calendar year 2018. Morgan Stanley also analyzed the premium or discount represented by the ratio of share price to Street consensus estimated net asset value and to our management's estimated NAV as of March 31, 2018. The multiples and ratios for each of the selected companies were calculated using their respective closing prices on April 27, 2018 and were based on the most recent publicly available information and Street consensus estimates as of April 27, 2018, which represents the last closing price for the Company's common shares and the selected companies' stock prior to them being affected by acquisition rumors and similar merger-related news that followed the announcement of the merger between DCT and Prologis on April 29, 2018. Morgan Stanley derived a range for each metric using the mean value for each statistic for the applicable comparable companies as a midpoint and setting a range using (a) 1.0x above and below that midpoint for share price to 2018 estimated FFO and share price to 2018 estimated AFFO, (b) 0.5x above and below the midpoint for aggregate value to 2018 estimated EBITDA and (c) 5% above and below the midpoint for the premium or discount of share price to Street consensus estimated NAV and to our management's estimated NAV. Morgan Stanley selected these ranges based on its professional judgment after reviewing the selected companies' ranges for each metric and the historical ranges of the Company for each metric.

        Morgan Stanley then used these multiple ranges to derive separate implied per share equity value reference ranges for the Company using each of the metrics reviewed by applying the range derived from the comparable companies for each metric to the corresponding Company metrics. The following table reflects the results of this analysis:

 
  Range   Implied Per Share Equity Value Range  
 
  Low   High   Low   High  

Price / 2018E FFO

    11.2x     13.2x   $ 22.70   $ 26.74  

Price / 2018E AFFO

    11.4x     13.4x   $ 21.94   $ 25.79  

Aggregate Value / 2018E EBITDA

    14.3x     15.3x   $ 19.95   $ 22.61  

Premium / Discount to the mean Street consensus estimated NAV

    (14)%     (4)%   $ 22.28   $ 24.88  

Premium / Discount to our management's estimated NAV

    (14)%     (4)%   $ 22.72   $ 25.37  

        Based on this analysis, Morgan Stanley derived the following selected implied per share equity value reference range for the Company based on the average of the low end and an average of the high end of the implied per share equity value reference range for each metric set forth above. This analysis indicated the following implied per share equity value reference range for a common share of the Company, as compared to the merger consideration of $27.50 per share:

Implied Per Share Equity Value Reference Range
  Per Share Merger Consideration  
$21.92 to $25.08   $ 27.50  

        No company utilized in the comparable company analysis is identical to the Company. In evaluating comparable companies, Morgan Stanley made judgments and assumptions with regard to industry performance, general business, economic, market and financial conditions and other matters, which are beyond the Company's control, such as the impact of competition on the Company and the industry generally, industry growth, and the absence of any adverse material change in the financial condition and prospects of the Company or the industry, or in the financial markets in general.

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Mathematical analysis (such as determining the average or medium) is not in itself a meaningful method of using comparable company data.

Net Asset Value Analysis

        Morgan Stanley analyzed the value of the Company as a function of the net value of its assets. Morgan Stanley based its net asset value analysis on our management's estimates of asset value as of March 31, 2018. Morgan Stanley calculated the estimated net asset value per common share of the Company by applying to management's estimated forward net operating income of $447 million (after adjustment to provide full credit for any executed leases that are not yet paying rent) a range of market capitalization rates as of March 31, 2018 of 5.7% to 6.4%, which range was selected based on, among other factors, asset quality, location, current occupancy levels, research capitalization rates and discussions with management of the Company. Morgan Stanley added the estimated value of the Company's joint ventures, development in progress, mezzanine lending notes receivable, and other assets from our balance sheet and deducted debt and preferred balances, and other liabilities from the aggregate value of the Company's assets. An implied per share equity value reference range for the Company was then calculated based on the range of our net asset values derived from such analysis divided by the number of fully diluted common shares outstanding as of March 31, 2018 and pro forma for recent acquisitions through April 6, 2018. This analysis indicated the following implied per share equity value reference range for each common share of the Company, as compared to the merger consideration of $27.50 per share:

Implied Per Share Equity Value Reference Range
  Per Share Merger Consideration  
$24.49 to $28.93   $ 27.50  

Discounted Cash Flow Analysis

        Morgan Stanley performed a discounted cash flow analysis, which is designed to imply a value of a company by calculating the present value of estimated future unlevered free cash flows and terminal value of the company. The "unlevered free cash flows" or "free cash flows" refer to a calculation of the future cash flows of an asset without including, in such calculation, any debt-servicing costs. The present value of a terminal value, representing the value of unlevered free cash flows beyond the end of the forecast period, is added to arrive at a total aggregate value. Outstanding debt and preferred equity is subtracted and outstanding cash is added to arrive at an equity value. The equity value is then divided by the number of fully diluted common shares, in order to arrive at an implied equity value per share.

        Morgan Stanley calculated ranges of implied equity values per common share, based on a discounted cash flow analysis utilizing Company management projections which excluded unidentified future acquisitions and development from June 30, 2019 through June 30, 2024.

        The unlevered free cash flows from June 30, 2019 to June 30, 2023 were discounted to present value using a range of discount rates from 5.5% to 6.7% representing the Company's weighted average cost of capital. The weighted average cost of capital was determined utilizing the capital asset pricing model to calculate the Company's cost of equity and utilizing the Company's current weighted average interest rate on its current indebtedness to calculate the Company's cost of debt.

        Morgan Stanley then calculated a range of implied terminal enterprise values of the Company as of June 30, 2023 by applying a range of implied exit capitalization rates of 6.7% to 7.1% to the forecasted net operating income of the Company for the twelve months ending June 30, 2024. The range of capitalization rates was selected using the implied trading capitalization rate for the Company as of April 27, 2018 of 6.7% (based on management's calculation of March 31, 2018 net asset value) as the low end of the range and growing that capitalization rate by 0.05% per year (determined by

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Morgan Stanley in its professional judgment) over the forecast period as the high end of the range. The implied terminal enterprise value of the Company was then discounted to present value using a range of the Company's weighted average cost of capital as the discount rates. This present value of the implied terminal enterprise value of the Company was then added to the implied present value of the unlevered free cash flows as described above, subtracting outstanding debt and preferred equity and adding outstanding cash as of March 31, 2018 and pro forma for recent acquisitions through April 6, 2018, and dividing by the number of fully diluted common shares, all as provided by the Company's management.

        This analysis implied the following range for the Company's common shares, as compared to the merger consideration of $27.50 per share:

Implied Per Share Equity Value Reference Range
 
Per Share Merger Consideration
$24.08 to $27.86   $27.50

Premiums Paid Analysis

        Using publicly available information, Morgan Stanley reviewed the terms of selected public company precedent transactions announced between March 30, 2001 to April 29, 2018, in which the targets were industrial and net lease REITs and the transaction was at least $200 million (but excluding merger of equals and reverse merger transactions). All transactions that Morgan Stanley found that satisfied the foregoing criteria were included in the premiums paid analysis.


Selected Precedent Transactions

Transaction Announcement Date
  Target   Acquiror
April 2018   DCT Industrial   Prologis
October 2013   Cole Real Estate Investments   American Realty Capital Properties, Inc.
May 2013   CapLease, Inc.   American Realty Capital Properties, Inc.
September 2012   American Realty Capital Trust   Realty Income Corp.
November 2007   American Financial Realty Trust   Gramercy Capital Corp.
March 2007   Spirit Finance Corp.   Redford Holdco
October 2006   Trustreet Properties   GE Capital
October 2006   Government Property Trust   Record Realty Trust
February 2006   Bedford Property Investors   LBA Realty
September 2005   Capital Automotive REIT   DRA Advisors, Inc.
May 2004   Keystone Property Trust   ProLogis Trust & Eaton Vance
October 2001   Cabot Industrial Trust   CalWest
July 2001   Captec Net Lease Realty, Inc.   Commercial Net Lease Realty
March 2001   Franchise Finance Corporation of America   GE Capital

        Morgan Stanley calculated the premiums paid in these transactions over the applicable unaffected stock price of the acquired company (i.e., the amount by which the price that the purchaser paid for the shares of the target exceeded the unaffected market price of such shares), which represents the average stock price for the ten trading days ending five trading days prior to the announcement of such precedent transactions. Morgan Stanley noted that the mean of the premium paid in these precedent transactions was 17%.

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        Based on the results of this analysis and the premiums paid in precedent transactions as outlined above, Morgan Stanley applied a premium range of 12% to 20% based on the observed fourth quartile and first quartile, respectively, to the last unaffected price for the Company's common shares of $23.30 on April 27, 2018, which resulted in the following implied common share equity value range of the Company, as compared to the merger consideration of $27.50 per share:

Implied Per Share Equity Value Reference Range
 
Per Share Merger Consideration

$26.09 to $28.04

 

$27.50

        No company or transaction utilized in the premiums paid analysis is identical to the Company or the mergers. The fact that points in the range of implied value per share of the Company derived from the valuation of premiums paid in precedent transactions were less than or greater than the consideration is not necessarily dispositive in connection with Morgan Stanley's analysis of the consideration for the mergers, but is one of many factors Morgan Stanley considered.

Private Buyer Analysis

        Morgan Stanley performed a hypothetical take-private analysis to determine the prices at which a financial sponsor might effect a leveraged buyout of the Company under current market conditions assuming two different hypothetical buyers—a highly leveraged buyer and a core-plus buyer. In preparing this analysis, Morgan Stanley utilized the projections prepared by the management of the Company and calculated net operating income from June 30, 2019 through June 30, 2024. Morgan Stanley based its analysis on the projections provided by our management, which excluded unidentified future acquisitions and development, and assumed a range of market capitalization rates at a 2024 exit of 5.7% to 6.2%. In addition, Morgan Stanley assumed: (a) for its analysis of the hypothetical highly leveraged buyer, that (i) buyer incurs new CMBS debt in connection with the transaction in an aggregate principal amount resulting in a loan-to-value ratio of 75% for the Company, and (ii) that the buyer incurs approximately $212 million in debt issuance and breakage costs for debt and other termination costs in connection with the transaction and the highly levered buyer targeting a gross internal rate of return of 15% to 17%; and (b) for its analysis of the hypothetical core-plus buyer, (i) buyer adjusts its leverage to a loan-to-value ratio of approximately 45% in line with core-plus buyers and (ii) that the buyer incurs such transaction costs of $147 million and is targeting a gross internal rate of return of 10% to 12%. Based upon these assumptions, Morgan Stanley calculated the following implied per share equity value reference range for our common shares, as compared to the merger consideration of $27.50 per share:

Implied Per Share Equity Value Reference Range    
Highly Levered Buyer
  Core-Plus Buyer  
Per Share Merger Consideration
$23.54 to $26.63   $23.35 to $27.25   $27.50

Historical Stock Price

        Morgan Stanley reviewed our stock price performance during the 52 weeks, and the portion of the calendar year, ending on April 27, 2018, representing the last unaffected price for the Company's common shares. Based on this review, Morgan Stanley noted that the Company common shares had traded in the following ranges over the applicable 52-week period, and calendar year period, ending April 27, 2018, as compared to the merger consideration of $27.50 per share:

52 Weeks Ending
April 27, 2018
 
Portion of Calendar Year Ending
April 27, 2018
 
Per Share Merger Consideration
$21.12 to $31.26   $21.12 to $26.87   $27.50

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General

        Morgan Stanley performed a variety of financial and comparative analyses for purposes of rendering its opinion. The preparation of a financial opinion is a complex process and is not necessarily susceptible to a partial analysis or summary description. In arriving at its opinion, Morgan Stanley considered the results of all of its analyses as a whole and did not attribute any particular weight to any analysis or factor it considered. Morgan Stanley believes that selecting any portion of these analyses, without considering all analyses as a whole, would create an incomplete view of the process underlying its analyses and opinion. In addition, Morgan Stanley may have given various analyses and factors more or less weight than other analyses and factors, and may have deemed various assumptions more or less probable than other assumptions. As a result, the ranges of valuations resulting from any particular analysis described above should not be taken to be Morgan Stanley's view of the actual value of the Company.

        In performing its analyses, Morgan Stanley made numerous assumptions with respect to industry performance, general business, regulatory, economic, market and financial conditions and other matters. These include, among other things, the impact of competition on the businesses of the Company and the industry generally, industry growth, and the absence of any adverse material change in the financial condition and prospects of the Company, or the industry, or in the financial markets in general. Many of these assumptions are beyond the control of the Company. Any estimates contained in Morgan Stanley's analyses are not necessarily indicative of future results or actual values, which may be significantly more or less favorable than those suggested by such estimates.

        Morgan Stanley conducted the analyses described above solely as part of its analysis of the fairness from a financial point of view of the merger consideration to be received by the holders of our common shares pursuant to the merger agreement, and in connection with the delivery of its opinion as of May 6, 2018 to our board of trustees. These analyses do not purport to be appraisals or to reflect the prices at which our common shares might actually trade.

        The merger consideration was determined through arm's-length negotiations between the Company and Blackstone and was unanimously approved by our board of trustees. Morgan Stanley did not recommend any specific form or amount of merger consideration to us or our board of trustees, or that any specific merger consideration constituted the only appropriate consideration for the merger. Morgan Stanley was not requested to opine as to, and its opinion does not in any manner address, the underlying business decision of the Company to proceed with or effect the mergers or the likelihood of consummation of the merger, nor does it address the relative merits of the mergers as compared to any other alternative business transaction, or other alternatives, or whether or not such alternatives could be achieved or are available. Morgan Stanley's opinion was not intended to, and does not, express an opinion or a recommendation as to how any holder of our common shares should vote at the special meeting to be held in connection with the mergers, or as to any other action that a holder of our common shares should take relating to the mergers.

        Morgan Stanley's opinion and presentation to our board of trustees was one of many factors taken into consideration by our board of trustees in deciding to approve the mergers and other transactions contemplated by the merger agreement. Consequently, the analyses as described above should not be viewed as determinative of the opinion of our board of trustees with respect to the merger consideration or of whether our board of trustees would have been willing to agree to a different merger consideration.

        Morgan Stanley's opinion was approved by a committee of Morgan Stanley investment banking and other professionals in accordance with its customary practice. Morgan Stanley is a global financial services firm engaged in the securities, investment management and individual wealth management businesses. Its securities business is engaged in securities underwriting, trading and brokerage activities, foreign exchange, commodities and derivatives trading, prime brokerage, as well as providing

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investment banking, financing and financial advisory services. Morgan Stanley, its affiliates, directors and officers may at any time invest on a principal basis or manage funds that invest, hold long or short positions, finance positions, and may trade or otherwise structure and effect transactions, for its own account or the accounts of its customers, in debt or equity securities or loans of Parent or any of its affiliates, the Company or any other company, or any currency or commodity, that may be involved in the mergers, or any related derivative instrument. In addition, Morgan Stanley, its affiliates, directors and officers may have committed and may commit in the future to invest in private equity funds managed by affiliates of Blackstone.

        Under the terms of its engagement letter, Morgan Stanley provided our board of trustees with financial advisory services and a financial opinion, and we have agreed to pay Morgan Stanley an aggregate fee equal to approximately $34 million, payable upon the closing of the mergers. We have also agreed to reimburse Morgan Stanley for its reasonable and documented out-of-pocket expenses, including fees of outside counsel and other professional advisors, incurred in performing its services in an amount not to exceed $100,000 without our prior written consent (not to be unreasonably withheld). In addition, we have agreed to indemnify Morgan Stanley and its affiliates, their respective officers, directors, employees and agents and each person, if any, controlling Morgan Stanley or any of its affiliates against certain liabilities and expenses, including certain liabilities under the federal securities laws, relating to, arising out of or in connection with Morgan Stanley's engagement.

        Morgan Stanley has provided financial advisory and financing services to the Company and its affiliates and, in the 30 months prior to April 24, 2018, has received fees of approximately $10 million to $25 million in the aggregate in connection with such services. Morgan Stanley has provided financial advisory and financing services to Blackstone and its affiliates (including certain majority-controlled affiliates and majority-controlled portfolio companies of Blackstone identified by Morgan Stanley and disclosed to us) and, in the 30 months prior to April 24, 2018, received fees of approximately $100 million to $125 million in connection with such services (the majority of which fees were received for financing services). As of May 3, 2018, Morgan Stanley held an aggregate interest of less than 1% of the common shares of the Company and, with respect to Blackstone and its affiliates (including certain majority-controlled affiliates and majority-controlled portfolio companies of Sponsor), an aggregate interest of less than 1% in the common stock of each of Mphasis Limited and Vivint Solar, Inc., an aggregate interest of between 2% and 3% in the common stock of Blackstone Mortgage Trust, Inc., and an aggregate interest of between 5% and 6% in the common units of The Blackstone Group L.P., which interests were held in connection with Morgan Stanley's investment management business, wealth management business, including client discretionary accounts, or ordinary course trading activities, including hedging activities. Morgan Stanley has advised us that it was providing, and may also seek in the future to provide, financial advisory and financing services to the Company, Blackstone or their respective affiliates (including portfolio companies of Blackstone and its affiliates) and would expect to receive fees for the rendering of those services. The information disclosed in this paragraph is based upon information provided to us by Morgan Stanley.

Financing

        In connection with the closing of the mergers, Parent will cause an aggregate of approximately $4.6 billion to be paid to the holders of our common shares, including holders of Company equity awards, and the minority limited partners (assuming none of the minority limited partners elects to receive Series B preferred units in the Surviving Partnership). In connection with the redemption of our preferred shares as described under "The Merger Agreement—Treatment of Common Shares, Preferred Shares and Equity Awards," Parent will cause approximately $88 million (plus accrued and unpaid dividends to, but not including, the redemption date) to be paid to the holders of our preferred shares. In addition, Parent has informed us that in connection with the closing of the mergers, Parent expects to cause all of our outstanding unsecured senior notes and term loans and all of outstanding

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indebtedness under our revolving credit facility to be prepaid in full at the closing. Parent has informed us that it expects our mortgage loans to be repaid or remain outstanding. As of March 31, 2018, we had approximately $2.2 billion in aggregate principal amount of consolidated indebtedness under our unsecured senior notes, term loans and revolving credit facility and $551 million in aggregate principal amount of consolidated indebtedness under our mortgage loans. As of March 31, 2018, our share of unconsolidated joint venture secured debt was approximately $127 million.

        Parent has informed us that it has received a debt commitment letter from Citigroup Global Markets Inc. and Bank of America, N.A. providing for debt financing in connection with the mergers in an aggregate amount not to exceed $3.0 billion and that it may seek to obtain additional debt financing in connection with the mergers. In addition, it is expected that the Sponsor and its affiliates will contribute equity to Parent for the purpose of funding the acquisition costs (including the merger consideration) that are not covered by such debt financing.

        Parent has informed us that in addition to the payment of the merger consideration, the funds to be obtained from the debt and equity financing may be used for purposes such as reserves, the refinancing of certain of our existing debt, and for other costs and expenses related to the financing and the mergers. Parent has informed us that it currently believes that the funds to be borrowed under each debt financing would be secured by, among other things, a first priority mortgage lien on certain properties which are wholly owned by us, escrows, reserves, a cash management account, or a first priority pledge of and security interest in the direct or indirect ownership interests in the owners of the properties, in each case, together with such other pledges and security required by the lender to secure and perfect their interest in the applicable collateral and that such debt financings would be conditioned on the mergers being completed and other customary conditions for similar financings.

        Pursuant to the merger agreement, we have agreed to deliver, promptly following Parent's request, to each of the lenders under our existing mortgage indebtedness a notice prepared by Parent, in form and substance reasonably approved by us, requesting, to the extent required by the applicable loan documents, that such lender consent to the consummation of the mergers and the other transactions contemplated by the merger agreement and to certain modifications of the existing loan documents reasonably requested by Parent.

        The merger agreement does not contain a financing condition or a "market MAC" condition to the closing of the mergers. For more information, see "The Merger Agreement—Financing Cooperation" and "The Merger Agreement—Conditions to the Mergers."

Interests of Our Trustees and Executive Officers in the Mergers

        In considering the recommendation of our board of trustees to approve the merger and the other transactions contemplated by the merger agreement, our shareholders should be aware that our trustees and executive officers have certain interests, including financial interests, in the mergers that are different from, or in addition to, the interests of our shareholders generally. These interests may create potential conflicts of interest. Our board of trustees was aware of these interests, which are described below, and considered them, among other matters, in reaching its decision to approve the merger and the other transactions contemplated by the merger agreement.

Treatment of Equity Awards

        Restricted Share Awards.    Immediately prior to the merger effective time, each Company restricted share award that is outstanding immediately prior to the merger effective time will be cancelled in exchange for a cash payment in an amount equal to (1) the number of common shares subject to the Company restricted share award immediately prior to the merger effective time multiplied by (2) the merger consideration, less any applicable withholding taxes.

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        Restricted Share Unit Awards.    Immediately prior to the merger effective time, each Company RSU award that is outstanding immediately prior to the merger effective time will be cancelled in exchange for a cash payment in an amount equal to (1) the number of common shares subject to the Company RSU award immediately prior to the merger effective time multiplied by (2) the merger consideration, less any applicable withholding taxes.

        Company Options.    Immediately prior to the merger effective time, each Company option that is outstanding immediately prior to the merger effective time will be cancelled in exchange for a cash payment in an amount equal to (1) the number of common shares subject to the Company option immediately prior to the merger effective time multiplied by (2) the excess (if any) of the merger consideration over the per share exercise price applicable to the option, less any applicable withholding taxes.

        Company LTIP Units.    Each unvested Company LTIP unit that is outstanding on the business day prior to the partnership merger effective time will vest, without proration, pursuant to its terms on the business day prior to the closing date, and, with respect to the maximum number of vested Company LTIP units then eligible for conversion under the terms of the partnership agreement, we will exercise our right to convert each such vested Company LTIP unit (including those that vest on the business day prior to the closing date) into a Class A partnership unit immediately prior to the time at which the partnership merger becomes effective and be treated as a Class A partnership unit.

        Value of Payments.    For an estimate of the value of the payments and benefits described above that would become payable to each of our executive officers in respect of their unvested equity awards, see "—Quantification of Potential Payments to Our Executive Officers in Connection with the Mergers" below. All of the outstanding Company options and Company RSU awards held by our non-employee trustees are fully vested. The estimated value of the payments that will be made to our non-employee trustees at the effective time of the merger in respect of their vested Company options and vested Company RSU awards is $2,333,415, which is based on the number of outstanding awards held by the non-employee trustees as of May 31, 2018 and assumes that the merger consideration is $27.50 and no additional consideration is paid. The non-employee trustees may receive compensation in the ordinary course of business consistent with past practice through the effective time of the mergers, and thus this amount is subject to increase prior to the effective time of the mergers.

Executive Severance Benefits

        Arrangements.    We are party to employment and non-competition agreements with each of Gordon F. DuGan, Benjamin P. Harris, Nicholas L. Pell, and Jon W. Clark that provide for the severance benefits described below upon a severance-qualifying termination of employment. In addition, in connection with the mergers, the compensation committee of our board of trustees approved a severance policy for employees of the Company pursuant to which Edward J. Matey Jr. is eligible to receive certain benefits upon a severance-qualifying termination of employment. The severance benefits payable to each of Messrs. DuGan, Harris, Pell, Clark and Matey will be subject to the executive officer's execution and non-revocation of a release of claims against the Company.

        Mr. DuGan.    If Mr. DuGan's employment is terminated by us without cause or he resigns with good reason, in either case during the 18 months following the effective time of the mergers, Mr. DuGan would be entitled to receive (1) a cash severance payment equal to three times the sum of his average annual base salary over the 24 months prior to termination plus his most recent annual bonus paid, which shall be payable in installments over a period of 24 months, (2) a cash payment equal to the highest annual bonus paid during the three years prior to the termination date, paid in a lump sum and prorated based on the number of days elapsed during the fiscal year of termination and (3) a monthly cash payment equal to the amount of the monthly Company contribution in respect of

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his health insurance for a period of 24 months, or, if earlier, until he is entitled to receive health insurance from another employer.

        Messrs. Harris and Pell.    If the employment of Mr. Harris or Mr. Pell is terminated by us without cause or if Mr. Harris or Mr. Pell resigns with good reason, in either case during the 18 months following the effective time of the mergers, each executive officer would be entitled to receive (1) a cash severance payment equal to a multiple of 2.5 times the sum of his average annual base salary over the 24 months prior to termination, plus the highest annual bonus paid during the three years prior to termination, which shall be payable in installments over a period of 12 months, (2) a cash payment equal to the highest annual bonus paid to the executive officer during the three years prior to the termination date, paid in a lump sum and prorated based on the number of days elapsed during the fiscal year of termination and (3) a monthly cash payment equal to the amount of the monthly Company contribution in respect of the executive officer's health insurance for a period of 12 months, or, if earlier, until he is entitled to receive health insurance from another employer.

        Mr. Clark.    If Mr. Clark's employment is terminated by us without cause or he resigns with good reason, in either case during the 18 months following the effective time of the mergers, Mr. Clark would be entitled to receive (1) a cash severance payment equal to 24 months of his base salary in effect as of the termination date and two times his annual bonus for the year prior to the year of termination, payable in a lump-sum, (2) a cash payment equal to his annual bonus for the year prior to the year of termination, paid in a lump sum and prorated based on the days elapsed during the fiscal year of termination and (3) continued participation in health insurance benefits for a period of six months as if he had remained employed, or, if earlier, until he is entitled to receive benefits of the same type from another employer.

        Mr. Matey.    If the employment of Mr. Matey is terminated by us without cause or he resigns with good reason, in either case during the 18 months following the effective time of the mergers, he would be entitled to receive: (1) a lump sum cash payment, payable within 30 days following termination, in an amount equal to the sum of (a) 1.5 times the sum of his annual base salary and most recent prior fiscal year's bonus and (b) 12 months of COBRA premium subsidies and (2) a prorated bonus for the year in which the termination occurs, with the amount of such bonus based on actual performance for the year of termination payable within 30 days following termination if the termination occurs in 2018 and at the time bonuses are paid to actively employed employees the termination occurs in 2019.

        Good Reason Definition Amendment.    In connection with the mergers, the Company amended the definition of "good reason" in the employment agreements of Messrs. Pell and Harris. Following such amendment, following a change-in-control, the definition of "good reason" in each of their employment agreements now includes any change in their duties, responsibilities, status or positions as President or Chief Investment Officer (as applicable) of a publicly traded company, which change will occur when Gramercy ceases to be a standalone public company.

        Golden Parachute Excise Tax.    The employment agreements with each of Messrs. DuGan, Harris, Pell and Clark and the severance policy covering Mr. Matey provide that if the payments and benefits provided to the executive officer in connection with the mergers would be subject to an excise tax by reason of Sections 4999 and 280G of the Internal Revenue Code, such benefits and payments will be reduced to the extent necessary to prevent any portion of the executive officer's merger-related payments and benefits from becoming subject to such excise tax, but only if, by reason of that reduction, the net after-tax benefit received by the executive officer exceeds the net after-tax benefit the executive officer would receive if no reduction was made.

        Restrictive Covenants.    Messrs. DuGan, Harris and Pell are subject to post-termination non-competition covenants for 18 months for Mr. DuGan and 12 months for Messrs. Harris and Pell; provided that in the event that the executive officer is terminated without cause or resigns with good

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reason, the restricted period will be reduced from 18 months to 12 months for Mr. DuGan and from 12 months to six months for Messrs. Harris and Pell. Mr. Clark is subject to a six-month post-termination non-competition covenant; provided that in the event of a non-renewal of Mr. Clark's agreement, a termination for cause based on conduct or alleged conduct that was not related to our business, or resignation within sixty days after the payment of a discretionary bonus for any year in an amount less than $200,000, the restricted period will be reduced from six months to three months. Messrs. DuGan, Harris, Pell and Clark are also subject to a 24-month post-termination non-solicitation covenant with respect to employees and a 12-month post-termination non-solicitation covenant with respect to borrowers, tenants, clients and suppliers. Mr. Matey is not subject to any restrictive covenants.

        Value of Payments.    For an estimate of the value of the severance payments and benefits described above that would become payable to each of our executive officers upon a severance-qualifying termination, see "—Quantification of Potential Payments to Our Executive Officers in Connection with the Mergers" below.

Indemnification of Our Trustees and Officers

        The merger agreement provides that from and after the merger effective time, Parent shall, and shall cause the Surviving Company and the Surviving Partnership to, to the fullest extent permitted by applicable law, indemnify, defend and hold harmless each of our and our subsidiaries' current or former trustees, directors or officers and each fiduciary under our or our subsidiaries' benefit plans (which persons we refer to as the indemnified persons), against all losses, expenses (including reasonable attorneys' fees and expenses), judgments, fines, claims, actions, suits, damages or liabilities or, subject to certain exceptions, amounts paid in settlement in connection with any claim, action, suit, proceeding or investigation, whether civil, criminal, administrative or investigative, arising out of actions or omissions occurring at or prior to the merger effective time (whether asserted or claimed prior to, at or after the merger effective time), including in connection with the consideration, negotiation and approval of the merger agreement, to the extent that such actions or omissions are based on or arise out of the fact that such indemnified person is or was a trustee, director, officer or fiduciary under benefit plans, including any payment by the Surviving Company or Surviving Partnership on behalf of or advancement to such indemnified person of any expenses incurred by such indemnified person in connection with enforcing any rights with respect to such indemnification and/or advancement (we refer to the foregoing as the indemnified liabilities). In addition, Parent shall, and shall cause the Surviving Company and the Surviving Partnership to, to the fullest extent permitted by applicable law, indemnify, defend and hold harmless each indemnified person against all indemnified liabilities to the extent they are based on or arise out of or pertain to the transactions contemplated by the merger agreement (whether asserted or claimed prior to, at or after the merger effective time).

        The parties have agreed not to terminate or modify the obligations described above regarding indemnification of trustees, directors, officers and fiduciaries under benefit plans in such a manner as to adversely affect such indemnified persons, and such obligations must be assumed by any successor entity to the Surviving Company as a result of any consolidation, merger, dissolution or transfer of all or substantially all of its properties and assets.

        The merger agreement also requires that Parent cause the Surviving Company to maintain our officers' and trustees' liability insurance policies in effect on the date of the merger agreement for at least six years after the closing of the mergers (or substitute policies with at least the same coverage and amounts as our existing policies, and subject to certain other restrictions set forth in the merger agreement). This requirement is subject to a maximum cost of 300% of our current annual premium paid for such insurance (which we refer to as the maximum cost). If the cost to maintain or procure such insurance coverage exceeds the maximum cost, Parent and the Surviving Company shall maintain or procure for such six-year period the most advantageous policies as can be reasonably obtained for

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the maximum cost. Additionally, the Surviving Company and the Surviving Partnership shall provide to the indemnified persons the same rights to exculpation, indemnification and advancement of expenses that are provided to the indemnified persons under our and our subsidiaries' organizational documents in effect as of the date of the merger agreement, and the Surviving Company and the Surviving Partnership shall assume the contractual indemnification rights with any of our or our subsidiaries' current or former directors, officers or employees pursuant to specified agreements in effect as of the date of the merger agreement.

Transaction Incentive Awards

        The compensation committee of our board of trustees may grant cash transaction incentive awards with an aggregate value of up to $2.5 million, with any such transaction incentive awards to be paid in full on the closing date. Our board of trustees (or the compensation committee thereof) may allocate the cash transaction incentive award pool among our employees (including our executive officers) identified, and in the amounts and on the terms determined by, our board of trustees (or the compensation committee thereof). As of the date of this filing, no cash transaction incentive awards have been granted to any of our executive officers.

Annual Bonuses

        Immediately prior to the date of the effective time of the mergers, the compensation committee of our board of trustees will determine (subject to BRE Glacier Parent L.P.'s consent), the amount of annual bonuses payable to each of our employees (including the executive officers) in respect of the 2018 fiscal year in good faith in accordance with the terms of our annual bonus plans and otherwise in a manner consistent with past practice. BRE Glacier Parent L.P. will pay those bonuses to our employees, subject to their continued employment through the payment date, at the time bonuses would otherwise be paid in the ordinary course of business consistent with past practice.

Quantification of Potential Payments to Our Executive Officers in Connection with the Mergers

        The information set forth in the table below is intended to comply with Item 402(t) of Regulation S-K, which requires disclosure of information about certain compensation for each of our executive officers that is based on or otherwise relates to the mergers. For additional details regarding the terms of the payments described below, see the discussion under the caption "—Interests of Our Trustees and Executive Officers in the Mergers" above.

        The following table sets forth the amount of payments and benefits that may be paid or become payable to each of the executive officers in connection with the mergers pursuant to all applicable compensation plans or agreements, assuming that the effective time of the mergers occurred on May 31, 2018, which is the latest practicable date prior to the date of this filing and the assumed date of the effective time of the merger solely for purposes of this merger-related compensation disclosure and that each executive officer incurs a severance-qualifying termination immediately upon the effective time of the mergers.

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Golden Parachute Compensation

Name
  Cash
($)(1)
  Equity
($)(2)
  Perquisites/
Benefits($)(3)
  Total ($)  

Gordon F. DuGan

    5,455,287     7,027,827     41,344     12,524,458  

Chief Executive Officer

                         

Benjamin P. Harris

   
5,145,833
   
4,122,145
   
20,672
   
9,288,650
 

President

                         

Nicholas L. Pell

   
4,028,417
   
3,022,237
   
20,672
   
7,071,326
 

Chief Investment Officer

                         

Jon W. Clark

   
1,454,941
   
654,871
   
20,402
   
2,130,214
 

Chief Financial Officer

                         

Edward J. Matey Jr.

   
1,103,243
   
654,871
   
20,672
   
1,778,786
 

Executive Vice President and General Counsel

                         

(1)
Cash severance consists of the following components, all of which are "double-trigger" benefits contingent upon the occurrence of a termination of the executive officer's employment without cause or the executive officer's resignation with good reason during the 18 months following the effective time of the mergers:

(a)
For Messrs. DuGan, Harris and Pell, (i) a multiple (3 for Mr. DuGan and 2.5 for Messrs. Harris and Pell) of the sum of the executive officer's (x) average base salary over the 24 months prior to termination plus (y) the most recent annual bonus paid for Mr. DuGan and the highest annual bonus paid during the three years prior to termination for Messrs. Harris and Pell, in each case, payable in installments over 24 months for Mr. DuGan and 12 months for Messrs. Harris and Pell and (ii) a cash payment equal to the most recent annual bonus paid for Mr. DuGan and the highest annual bonus paid during the three years prior to termination for Messrs. Harris and Pell, in each case, prorated based on the days elapsed during the fiscal year of termination, and payable on the first regular payroll date following the 30th day following the termination date;

(b)
For Mr. Clark, a lump sum cash payment equal to the sum of (i) the sum of 24 months of his base salary in effect as of the termination date and two times his annual bonus for the year prior to the year of termination and (ii) his annual bonus for the year prior to the year of termination, prorated based on the days elapsed during the fiscal year of termination; and

(c)
For Mr. Matey, (i) a lump sum cash payment, payable within 30 days following termination, in an amount equal to 1.5 times the sum of his annual base salary and most recent prior fiscal year's bonus and (ii) a prorated bonus for the year in which the termination occurs, with the amount of such bonus based on actual performance for the year of termination payable within 30 days following termination, if the termination occurs in 2018, and at the time bonuses are paid to actively employed employees, if the termination occurs in 2019.

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Executive Officer
  Prorated
Bonus ($)
  Severance
Payment ($)
  Total ($)  

Gordon F. DuGan

    562,500     4,892,787     5,455,287  

Benjamin P. Harris

    520,833     4,625,000     5,145,833  

Nicholas L. Pell

    396,917     3,631,500     4,028,417  

Jon W. Clark

    138,783     1,316,158     1,454,941  

Edward J. Matey Jr. 

    91,466     1,011,777     1,103,243  
(2)
For all executive officers, the treatment of equity awards at the effective time of the mergers is a "single-trigger" benefit contingent upon the occurrence of the mergers. The amounts set forth in the table above and the table below are estimates of the value each executive officer will receive in respect of his unvested equity awards. These estimates assume (a) that each executive officer elects to receive the cash merger consideration in respect of each outstanding Company LTIP unit, (b) achievement of share price thresholds applicable to Company LTIP units subject to performance-based vesting conditions will be measured based upon a per common share price of $27.50, assuming that no additional consideration is paid and (c) all unvested Company restricted share awards and Company LTIP units held by each executive officer as of May 31, 2018, the latest practicable date prior to the date of this filing, remain unvested as of the effective time of the mergers.
Executive Officer
  Value of Company
Restricted Share
Awards ($)
  Value of
Company LTIP
Units ($)
  Total ($)  

Gordon F. DuGan

    3,412,283     3,615,544     7,027,827  

Benjamin P. Harris

    1,195,288     2,926,857     4,122,145  

Nicholas L. Pell

    956,203     2,066,034     3,022,237  

Jon W. Clark

    58,905     595,966     654,871  

Edward J. Matey Jr. 

    58,905     595,966     654,871  
(3)
Perquisites/Benefits.    Messrs. DuGan, Harris and Pell are each entitled to receive a monthly cash payment equal to the cost of the monthly employer paid portion of health coverage for a period of 24 months for Mr. DuGan and 12 months for Messrs. Harris and Pell. Mr. Matey is entitled to receive a lump sum cash payment equal to 12 months of COBRA premiums. Mr. Clark is entitled to participate in health insurance for six months following his termination as if he had remained employed. The health coverage benefits are "double-trigger" benefits contingent upon the occurrence of a termination without cause or resignation with good reason during the 18 months following the effective time of the mergers. For further details regarding the perquisites and benefits, see "—Interests of Our Trustees and Executive Officers in the Mergers—Executive Severance Benefits."

Regulatory Matters

        We are unaware of any material federal, state or foreign regulatory requirements or approvals that are required for the execution of the merger agreement or the completion of either the merger or the partnership merger, other than the acceptance for record of the articles of merger with respect to the

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merger by the State Department of Assessments and Taxation of Maryland, and the filing of the certificate of merger with respect to each of the merger and the partnership merger with the Secretary of State of the State of Delaware. For further information regarding the timing of the closing of the mergers, see "The Merger Agreement—Effective Times; Closing Date."

Litigation Relating to the Mergers

        Following announcement of the merger agreement, two purported class actions related to the proposed transaction, Anderson v. Gramercy Property Trust et al., No. 1:18-cv-05335-PCK and Franchi v. Gramercy Property Trust et al., No. 1:18-cv-01842-ELH, were filed in the United States District Court for the Southern District of New York and the United States District Court for the District of Maryland, respectively, and a third complaint related to the proposed transaction, Madry v. Gramercy Property Trust et al., No. 1:18-cv-01851-TDC, was filed as an individual (not a class) action in the United States District Court for the District of Maryland. The lawsuits all name as defendants the Company and the members of our board of trustees. The complaints allege, among other things, that the individual defendants caused the Company to file a materially incomplete and misleading preliminary proxy statement relating to the proposed transaction in violation of Sections 14(a) and 20(a) of the Exchange Act. The Anderson and Madry complaints seek a variety of equitable and injunctive relief, including enjoining defendants from consummating the proposed merger transaction unless and until the Company provides supplemental disclosures, unspecified damages and, in the case of the Anderson complaint, rescission of the merger agreement or any of the terms thereof, or rescissory damages. The Franchi complaint seeks, among other relief, to enjoin defendants from proceeding with, consummating or closing the proposed merger transaction, rescission of the merger transaction or rescissory damages and dissemination of a supplemental proxy statement. All three complaints also seek an award of attorneys' and expert fees and expenses. The courts have not acted on any of these complaints, and no relief has been granted as of the date of this proxy statement. We believe the lawsuits are without merit.

Material U.S. Federal Income Tax Consequences

        The following is a general discussion of the material U.S. federal income tax consequences of the merger to U.S. holders and non-U.S. holders (each as defined below) of our common shares whose shares are exchanged for cash pursuant to the merger and of our preferred shares whose shares are redeemed for cash pursuant to the merger. This discussion is based on the provisions of the Code, applicable U.S. Treasury Regulations, judicial opinions and administrative rulings and published positions of the Internal Revenue Service (which we refer to as the IRS), each as in effect as of the date hereof. These authorities are subject to change or differing interpretations, possibly with retroactive effect, and any such change or interpretation could affect the accuracy of the statements and conclusions set forth in this discussion. This discussion does not address any tax consequences arising under the unearned income Medicare contribution tax pursuant to the Health Care and Education Reconciliation Act of 2010, any withholding considerations under FATCA (defined for this purpose as sections 1471 through 1474 of the Code, the Treasury Regulations and administrative guidance thereunder and the intergovernmental agreements entered into, and laws and regulations promulgated, pursuant thereto or in connection therewith) nor does it address any tax considerations under state, local or non-U.S. laws or U.S. federal laws other than those pertaining to the U.S. federal income tax.

        For purposes of this discussion, the term "U.S. holder" means a beneficial owner of our common shares or preferred shares that, is for U.S. federal income tax purposes:

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        For purposes of this discussion, the term "non-U.S. holder" means a beneficial owner of our common shares or preferred shares, other than an entity or arrangement classified as a partnership for U.S. federal income tax purposes, that is not a U.S. holder.

        This discussion applies only to holders of our common shares or preferred shares who hold such shares as "capital assets" within the meaning of the Code (generally, property held for investment). Further, this discussion is for general informational purposes only and does not address all aspects of U.S. federal income taxation that may be relevant to specific holders in light of their particular facts and circumstances, and it does not apply to holders subject to special treatment under U.S. federal income tax laws (including, for example, insurance companies, dealers or brokers in securities or foreign currencies, traders in securities who elect to apply the mark-to-market method of accounting, holders subject to the alternative minimum tax, persons who are required to recognize income or gain with respect to the merger no later than such income or gain is required to be reported on an applicable financial statement, U.S. holders that have a functional currency other than the U.S. dollar, tax-exempt organizations, retirement plans, individual retirement accounts or other tax-deferred or advantaged accounts (or persons holding common shares or preferred shares through such plans or accounts), banks and other financial institutions, certain former citizens or former long-term residents of the United States, "controlled foreign corporations," "passive foreign investment companies," partnerships or other entities or arrangements treated as partnerships for U.S. federal income tax purposes or other flow-through entities (and investors therein), S corporations, real estate investment trusts, regulated investment companies, "qualified foreign pension funds" (within the meaning of Section 897(1)(2) of the Code) or entities all of the interests in which are held by a qualified pension fund, "qualified shareholders" (within the meaning of Section 897(k)(3) of the Code) or investors therein, non-U.S. holders who hold, or have held at any time, directly, indirectly, or constructively, more than 10% of our outstanding common shares or more than 10% of our outstanding preferred shares, holders who hold our common shares or preferred shares as part of a hedge, straddle, constructive sale, conversion or other integrated or risk reduction transaction, and holders who acquired our common shares or preferred shares through the exercise of employee stock options or otherwise as compensation).

        If a partnership (including any entity or arrangement classified as a partnership for U.S. federal income tax purposes) holds our common shares or preferred shares, the tax treatment of a partner in such partnership will generally depend on the status of the partners and the activities of the partnership. If you are, for U.S. federal income tax purposes, a partner in a partnership holding common shares or preferred shares, you should consult your tax advisor regarding the U.S. federal, state, local and non-U.S. tax consequences of the merger to you in light of your particular circumstances.

        All holders should consult their own tax advisors regarding the specific tax consequences of the merger to them in light of their particular facts and circumstances, including with respect to the applicability and effect of any U.S. federal, state, local, foreign or other tax laws.

        For U.S. federal income tax purposes, the parties will treat the merger as if the Company had (1) sold all of its assets to Merger Sub I in exchange for the merger consideration, the aggregate per preferred share redemption amount and the assumption of the Company's liabilities and then (2) made a liquidating distribution of such merger consideration and the aggregate per preferred share redemption amount to holders of the Company's common shares and preferred shares, respectively, in exchange for such shares.

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Consequences of the Merger to U.S. Holders of our Common Shares

        The receipt of cash by U.S. holders in exchange for our common shares pursuant to the merger will be a taxable transaction for U.S. federal income tax purposes. In general, a U.S. holder of our common shares that receives cash in exchange for such common shares in the merger will recognize gain or loss in an amount equal to the difference, if any, between (1) the amount of cash received and (2) the U.S. holder's adjusted tax basis in such shares.

        If a U.S. holder acquired different blocks of common shares at different times and different prices, such U.S. holder must determine its adjusted tax basis, gain or loss and holding period separately with respect to each block of common shares. Any such gain or loss will generally be capital gain or loss and will be long-term capital gain or loss if a U.S. holder's holding period in the common shares surrendered in the merger is greater than one year as of the date of the merger. Long-term capital gains of certain non-corporate holders, including individuals, are generally subject to U.S. federal income tax at preferential rates. The deductibility of capital losses is subject to limitations.

        In addition, the IRS has the authority to prescribe, but has not yet prescribed, regulations that would apply a tax rate of 25% to a portion of capital gain realized by a non-corporate shareholder on the sale of REIT shares that would correspond to the REIT's "unrecaptured Section 1250 gain."

        A U.S. holder who has held our common shares for less than six months at the time of the merger, taking into account the holding period rules of Sections 246(c)(3) and (4) of the Code, and who recognizes a loss on the exchange of such common shares in the merger will be treated as recognizing a long-term capital loss to the extent of any capital gain dividends received from us, or such holder's share of any designated retained capital gains, with respect to such shares.

Consequences of the Merger to Non-U.S. Holders of our Common Shares

General

        The U.S. federal income tax consequences of the merger to a non-U.S. holder will depend on various factors, including whether the receipt of all or a portion of the aggregate merger consideration is treated as a distribution from us that is attributable to gain from the sale of "United States real property interests" (which we refer to as USRPIs) under the provisions of the Foreign Investment in Real Property Tax Act of 1980 (which we refer to as FIRPTA). The IRS announced in Notice 2007-55 that it intends to take the position that under current law, unless an exception applies, the receipt of a liquidating distribution from a REIT received by a non-U.S. holder (including the receipt of cash in exchange for common shares in the merger, which will be treated as having been received in a deemed liquidation of the Company for U.S. federal income tax purposes) is subject to tax under FIRPTA as a distribution to the extent attributable to gain from the sale of USRPIs. Although legislation that would effectively override Notice 2007-55 has previously been proposed, no such legislation has yet been enacted, and it is not possible to say if or when any such legislation will be enacted.

        Accordingly, we intend to take the position that the receipt of cash in exchange for our common shares pursuant to the merger will be subject to tax in accordance with Notice 2007-55 as described in more detail below. In general, the provisions governing the taxation of distributions by REITs can be less favorable to non-U.S. holders than the taxation of sales or exchanges of REIT shares by non-U.S. holders, and non-U.S. holders should consult their tax advisors regarding the application of these provisions.

Distribution of Gain from the Disposition of USRPIs

        To the extent the tax treatment set forth in Notice 2007-55 applies, and to the extent cash received by a non-U.S. holder in the merger is treated as a distribution attributable to gain from the deemed or actual sale of our USRPIs (which we expect to be a substantial portion of such cash), such amount will

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be treated as income effectively connected with a U.S. trade or business of the non-U.S. holder, and generally will be subject to U.S. federal income tax on a net basis. A corporate non-U.S. holder will also be subject to the 30% branch profits tax (or such lower rate as may be specified by an applicable income tax treaty). In addition, 21% (or 20% to the extent provided in U.S. Treasury Regulations) of any such amounts paid to a non-U.S. holder will be withheld and remitted to the IRS.

        Notwithstanding the foregoing, if our common shares are "regularly traded" (within the meaning of applicable U.S. Treasury Regulations) on an established securities market located in the United States (and the non-U.S. holder did not hold more than 10% of such class of stock during the one year period ending on the date of the merger), the tax treatment and consequences described above would not apply, and non-U.S. holders would instead be subject to the rules described below under "—Taxable Sale of Common Shares." We believe that our common shares are, and will be at the effective time of the merger, regularly traded on an established securities market located in the United States within the meaning of applicable U.S. Treasury Regulations. Non-U.S. holders should consult their tax advisors regarding withholding tax considerations.

Taxable Sale of Common Shares

        Subject to the discussion above regarding distributions attributable to gain from the sale of USRPIs and the discussion below regarding backup withholding, a non-U.S. holder will generally not be subject to U.S. federal income tax or U.S. federal withholding tax on any gain or loss recognized on the receipt of cash in exchange for our common shares pursuant to the merger unless: (1) the gain is effectively connected with the non-U.S. holder's conduct of a trade or business in the United States, or, if an applicable income tax treaty applies, the gain is attributable to a permanent establishment maintained by the non-U.S. holder in the United States; (2) the non-U.S. holder is an individual present in the United States for 183 days or more in the taxable year of the merger and certain other requirements are met; or (3) such shares constitute USRPIs under FIRPTA.

        A non-U.S. holder whose gain is effectively connected with the conduct of a trade or business in the United States (or, if an applicable income tax treaty applies, is attributable to a permanent establishment maintained by the non-U.S. holder in the United States), generally will be subject to U.S. federal income tax on such gain on a net basis at the regular U.S. graduated rates in the same manner as a U.S. holder. In addition, a corporate non-U.S. holder may also, under certain circumstances, be subject to an additional branch profits tax.

        A non-U.S. holder who is an individual present in the United States for 183 days or more in the taxable year of the merger and who meets certain other requirements will be subject to a flat 30% tax on the gain derived from the merger, which may be offset by U.S. source capital losses of such non-U.S. holder, if any.

        If our common shares constitute a USRPI under FIRPTA, a non-U.S. holder would be subject to U.S. federal income tax on any gain or loss recognized on the receipt of cash in exchange for such common shares in the merger on a net basis at applicable U.S. graduated rates in the same manner as a U.S. holder, and such cash consideration may also be subject to the U.S. federal withholding tax under FIRPTA at a rate of 15%. A non-U.S. holder's common shares generally will not constitute a USRPI, and gain recognized by a non-U.S. holder upon receipt of cash in exchange for our common shares pursuant to the merger generally will not be subject to U.S. federal income or U.S. federal withholding tax under FIRPTA, if: (1) we are a "domestically controlled REIT," defined generally as a REIT in which, at all times during a specified testing period, less than 50% in value of the shares was held directly or indirectly by non-U.S. persons; or (2) our common shares are "regularly traded" (within the meaning of applicable U.S. Treasury Regulations) on an established securities market at the effective time of the merger (and the non-U.S. holder holds 10% or less of the total fair market value of such class of shares at all times during the shorter of (x) the five year period ending with the

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effective date of the merger and (y) the non-U.S. holder's holding period for the shares). We believe we are, and we expect to be at the effective time of the merger, a "domestically controlled REIT," but no assurances can be given that we are or will remain a domestically controlled REIT. In addition, we believe that our common shares are, and will be at the effective time of the merger, regularly traded on an established securities market (within the meaning of the applicable Treasury Regulation).

Consequences of the Merger to Holders of our Preferred Shares

        The redemption of our preferred shares will be treated as a taxable transaction. The U.S. federal income tax consequences of the redemption to holders of our preferred shares generally will be the same as the consequences to holders of our common shares described above with respect to the merger, except that the capital gain or loss recognized by a holder of our preferred shares will be measured by the difference between the amount of cash the holder receives in connection with the redemption of our preferred shares and such holder's adjusted tax basis in our preferred shares. Consistent with IRS Notice 2007-55 (described above), and without limiting any of the above discussion, 21% (or 20% to the extent provided in U.S. Treasury Regulations) of any cash received by a non-U.S. holder in the redemption, that is treated as a distribution attributable to gain from the deemed or actual sale of our USRPIs (which we expect to be a substantial portion of such cash), will be withheld and remitted to the IRS unless such holder qualifies for the 10% exception discussed above.

Information Reporting and Backup Withholding

        Information reporting and backup withholding (currently, at a rate of 24%) generally will apply to payments of cash made pursuant to the merger. Backup withholding will not apply, however, to a holder who (1) in the case of a U.S. holder, furnishes a correct taxpayer identification number and certifies that it is not subject to backup withholding on a duly executed IRS Form W-9, (2) in the case of a non-U.S. holder, furnishes a duly executed, applicable IRS Form W-8, or (3) is otherwise exempt from backup withholding and complies with other applicable rules and certification requirements.

        Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be claimed as a refund or a credit against such holder's U.S. federal income tax liability (if any) provided the required information is furnished to the IRS on a timely basis.

        This discussion of the material U.S. federal income tax consequences is for general information purposes only and is not tax advice. Holders of our common shares or preferred shares should consult their own tax advisors as to the specific tax consequences to them of the merger, including the effect of any federal, state, local, non-U.S. and other tax laws.

        Non-U.S. holders who hold, or have held during specified periods, directly, indirectly, or constructively, more than 10% of our outstanding common shares or more than 10% of our outstanding preferred shares generally are subject to special rules under FIRPTA. Such non-U.S. holders may be subject to tax on any gain recognized on the receipt of cash in exchange for their common shares or preferred shares pursuant to the merger or redemption, respectively, and withholding agents may withhold at a rate of up to 30% on such cash consideration. Non-U.S. holders should consult their own tax advisors regarding the application of the foregoing rules in light of their particular facts and circumstances, the procedures for claiming treaty benefits or otherwise establishing an exemption from U.S. withholding tax with respect to any portion of the cash consideration payable to them pursuant to the merger or in connection with the redemption, and the possible desirability of selling their shares (and considerations relating to the timing of any such sales).

Delisting and Deregistration of Our Common Shares and Preferred Shares

        If the merger is completed, our common shares and preferred shares will no longer be traded on the NYSE and will be deregistered under the Exchange Act.

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THE MERGER AGREEMENT

        The following summarizes the material provisions of the merger agreement. This summary does not purport to be complete and may not contain all of the information about the merger agreement that is important to you. The summary of the material terms of the merger agreement below and elsewhere in this proxy statement is qualified in its entirety by reference to the merger agreement, a copy of which is attached to this proxy statement as Exhibit A and which we incorporate by reference into this proxy statement. We recommend that you read the merger agreement attached to this proxy statement as Exhibit A carefully and in its entirety, as the rights and obligations of the parties are governed by the express terms of the merger agreement and not by this summary or any other information contained in this proxy statement.

        The merger agreement contains representations and warranties made by, and to, us, the Partnership, Parent, Merger Sub I and Merger Sub II. These representations and warranties, which are set forth in the copy of the merger agreement attached to this proxy statement as Exhibit A, were made for the purposes of negotiating and entering into the merger agreement between the parties, or may have been used for the purpose of allocating risk between the parties instead of establishing such matters as facts. In addition, these representations and warranties may be subject to important qualifications and limitations agreed by the parties in connection with negotiating the terms of the merger agreement, were made as of specified dates, and may be subject to standards of materiality different from what may be viewed as material to our shareholders. Moreover, information concerning the subject matter of the representations and warranties, which do not purport to be accurate as of the date of this proxy statement, may have changed since the date of the merger agreement and subsequent developments or new information qualifying a representation or warranty may have been included in this proxy statement. You should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or conditions of the Company or its affiliates.

        As used in the summary of the material terms of the merger agreement below and elsewhere in this proxy statement, unless the context requires otherwise, references to our "subsidiaries" do not include certain joint venture entities in which we, directly or indirectly through our subsidiaries, own interests.

Structure

The Partnership Merger

        At the partnership merger effective time, Merger Sub II will be merged with and into the Partnership, the separate existence of Merger Sub II will cease, and the Partnership will be the surviving partnership in the partnership merger. At the partnership merger effective time, all the properties, rights, privileges, powers and franchises of the Partnership and Merger Sub II will vest in the Surviving Partnership, and all debts, liabilities, duties and obligations of the Partnership and Merger Sub II will become the debts, liabilities, duties and obligations of the Surviving Partnership.

The Merger

        At the merger effective time, the Company will be merged with and into Merger Sub I, the separate existence of the Company will cease and Merger Sub I will be the surviving entity in the merger, such that immediately following the merger, Parent will be the sole limited partner of the Surviving Company and BRE Glacier LLC, a wholly owned subsidiary of Parent, will be the sole general partner of the Surviving Company. At the merger effective time, all the properties, rights, privileges, powers and franchises of the Company and Merger Sub I will vest in the Surviving Company, and all debts, liabilities, duties and obligations of the Company and Merger Sub I will become the debts, liabilities, duties and obligations of the Surviving Company. Following the completion of the merger, our common shares and preferred shares will no longer be traded on the NYSE and will be deregistered under the Exchange Act.

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Effective Times; Closing Date

        On the closing date, the Partnership and Merger Sub II will file a certificate of merger with the Secretary of State of the State of Delaware. The partnership merger will become effective at such time as the certificate of merger with respect to the partnership merger has been filed with the Secretary of State of the State of Delaware or on such other date and time as may be mutually agreed to by us and Parent and specified in the partnership merger certificate.

        On the closing date, Merger Sub I and the Company will file articles of merger with the State Department of Assessments and Taxation of Maryland and file a certificate of merger with the Secretary of State of the State of Delaware. The merger will become effective upon the later of the acceptance for record of the articles of merger with respect to the merger by the State Department of Assessments and Taxation of Maryland, the filing of the certificate of merger with respect to the merger with the Secretary of State of the State of Delaware, or on such other date and time as may be mutually agreed to by us and Parent and specified in the articles of merger and certificate of merger.

        Unless otherwise agreed in writing by the parties to the merger agreement, the partnership merger effective time and the merger effective time will occur on the closing date, with the merger effective time occurring immediately after the partnership merger effective time.

        In this proxy statement, we refer to the date on which the closing of the mergers occurs as the closing date. The closing of the mergers will take place on the third business day after satisfaction or waiver of the conditions to the mergers described under "—Conditions to the Mergers" (other than those conditions that by their nature are to be satisfied or waived at the closing of the mergers, but subject to the satisfaction or waiver of such conditions) or at such other date as may be mutually agreed to in writing by the parties to the merger agreement. However, Parent may on one or more occasions elect to delay the closing of the mergers to a date that is on or prior to October 10, 2018 by giving written notice to the Company (which we refer to as an extension notice) at least two business days immediately preceding the date that, but for such delivery of such extension notice, would have been the closing date. If Parent has delivered an extension notice, then Parent may, upon at least five business days' prior written notice to the Company, designate the closing date to occur on a business day occurring on or prior to October 10, 2018 (which we refer to as the designated closing date) (and, for the avoidance of doubt, Parent shall be entitled to provide one or more additional extension notices to delay the closing of the mergers to a date following such designated closing date that is on or prior to October 10, 2018, in which event the date specified in such additional extension notice(s) shall be the designated closing date). If, on the designated closing date, the conditions to the mergers described under "—Conditions to the Mergers" are not satisfied or waived (other than those conditions that by their nature are to be satisfied or waived at the closing of the mergers, but subject to the satisfaction or waiver of such conditions), then the closing of the mergers shall occur on the third business day following the satisfaction or waiver of the conditions to the mergers described under "—Conditions to the Mergers" (other than those conditions that by their nature are to be satisfied or waived at the closing of the mergers, but subject to the satisfaction or waiver of such conditions) or on such other date as may be mutually agreed to in writing by the parties to the merger agreement.

Organizational Documents

        At the merger effective time, the certificate of limited partnership and the limited partnership agreement of Merger Sub I, as in effect immediately prior to the merger effective time, will be the certificate of limited partnership and the limited partnership agreement, respectively, of the Surviving Company, until further amended in accordance with their respective terms or applicable law. The certificate of limited partnership of the Partnership, as amended and as in effect immediately prior to the partnership merger effective time, will be the certificate of limited partnership of the Surviving Partnership until amended on the closing date following the merger effective time in accordance with

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its terms and applicable law. The fourth amended and restated agreement of limited partnership of the Partnership, as further amended prior to the closing date as required by the merger agreement and as in effect immediately prior to the partnership merger effective time (which we refer to as the partnership agreement), will be the limited partnership agreement of the Surviving Partnership until further amended in accordance with its terms and applicable law.

Officers; General Partner and Limited Partners

        Following the partnership merger effective time and prior to the merger effective time, we will be the sole general partner and a limited partner of the Surviving Partnership. In the event that any of the holders of Class A partnership units elect to convert all or a portion of such holders' Class A partnership units into Series B preferred units, such holders of newly issued Series B preferred units will be additional limited partners of the Surviving Partnership immediately following the partnership merger effective time. If no holders of Class A partnership units elect to convert any Class A partnership units into Series B preferred units, a direct or indirect wholly owned subsidiary of Merger Sub I (designated by Parent prior to the partnership merger effective time) will be admitted as a limited partner of the Surviving Partnership immediately prior to the partnership merger effective time.

        Following the merger effective time, the Surviving Company will be the sole general partner of the Surviving Partnership, and BRE Glacier LLC will be the sole general partner of the Surviving Company. The officers of the Company immediately prior to the merger effective time will be the initial officers of the Surviving Company from and after the merger effective time.

Treatment of Common Shares, Preferred Shares and Equity Awards

Common Shares

        At the merger effective time, each of our common shares (other than (1) excluded shares, which will automatically be canceled and retired and will cease to exist with no consideration being delivered in exchange therefor, and (2) any of our common shares under a Company restricted share award) issued and outstanding immediately prior to the merger effective time will automatically be converted into the right to receive the merger consideration. If we declare a distribution reasonably necessary to maintain our status as a REIT under the Code or to avoid the payment of income or excise tax under the Code as permitted under the merger agreement, the merger consideration will be decreased by an amount equal to the per share amount of such distribution.

Preferred Shares

        Promptly following Parent's request after the date this proxy statement is mailed to our shareholders, we will deliver to the holders of record of our preferred shares a notice of redemption contemplated by the Series A Articles Supplementary. The redemption notice will be prepared by us, in form and substance reasonably satisfactory to Parent, and will state that each of our preferred shares held by such holder immediately prior to the merger effective time will be redeemed by us effective as of the closing date through the payment of the per preferred share redemption price. Such redemption will be subject to and conditioned upon the occurrence of the closing of the mergers. Prior to the merger effective time, Parent will deposit or cause to be deposited with the paying agent funds sufficient to pay the aggregate per preferred share redemption amount.

Restricted Share Awards

        Immediately prior to the merger effective time, each Company restricted share award that is outstanding immediately prior to the merger effective time will be cancelled in exchange for a cash payment in an amount equal to (1) the number of common shares subject to the Company restricted

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share award immediately prior to the merger effective time multiplied by (2) the merger consideration, less any applicable withholding taxes.

Restricted Share Unit Awards

        Immediately prior to the merger effective time, each Company RSU award that is outstanding immediately prior to the merger effective time will be cancelled in exchange for a cash payment in an amount equal to (1) the number of common shares subject to the Company RSU award immediately prior to the merger effective time multiplied by (2) the merger consideration, less any applicable withholding taxes.

Company Options

        Immediately prior to the merger effective time, each Company option that is outstanding immediately prior to the merger effective time will be cancelled in exchange for a cash payment in an amount equal to (1) the number of common shares subject to the Company option immediately prior to the merger effective time multiplied by (2) the excess (if any) of the merger consideration over the per share exercise price applicable to the Company option, less any applicable withholding taxes.

Company LTIP Units

        Each unvested Company LTIP unit that is outstanding on the business day prior to the partnership merger effective time will vest, without proration, pursuant to its terms on the business day prior to the closing date, and, with respect to the maximum number of vested Company LTIP units then eligible for conversion under the terms of the partnership agreement, we will exercise our right to convert each such vested Company LTIP unit (including those that vest on the business day prior to the closing date) into a Class A partnership unit immediately prior to the time at which the partnership merger becomes effective and be treated as a Class A partnership unit as described below.

Treatment of Interests in the Partnership

Class A Partnership Units

        In connection with the partnership merger, each Class A partnership unit issued and outstanding immediately prior to the partnership merger effective time (other than (1) Class A partnership units owned by the Company or any wholly owned subsidiary of the Company, which Class A partnership units will be unaffected by the partnership merger and will remain outstanding as partnership units of the Surviving Partnership held by the Company, and (2) Class A partnership units owned by Parent, Merger Sub II or any of their respective wholly owned subsidiaries, which will automatically be canceled and will cease to exist with no consideration being delivered in exchange therefor) will automatically be converted into, and canceled in exchange for, the right to receive the merger consideration. As discussed above, if we declare a distribution reasonably necessary to maintain our status as a REIT under the Code, or to avoid the payment of income or excise tax as permitted under the merger agreement, the merger consideration will be decreased by an amount equal to the per share amount of such distribution.

        Each "eligible" minority limited partner may elect to convert all or a portion of such minority limited partner's Class A partnership units (including Company LTIP units that will be converted, prior to the partnership merger effective time, into Class A partnership units as described above) into Series B preferred units on a one-for-one basis, without interest, on the terms to be described in election materials that will be separately sent to the minority limited partners. Minority limited partners will only be eligible to elect to convert their Class A partnership units (including Company LTIP units that will be converted, prior to the partnership merger effective time, into Class A partnership units as described above) into Series B preferred units in the Surviving Partnership if they (1) make a valid and

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timely election to receive Series B preferred units pursuant to the election materials that will be separately sent to such minority limited partners, (2) are "accredited investors" as defined under the U.S. securities laws and not "benefit plan investors" within the meaning of ERISA or other plan, account or arrangement (or entity whose assets constitute the assets of a plan, account or arrangement) that is subject to any laws or regulations that are similar to the fiduciary responsibility or prohibited transactions provisions of ERISA or the Code and (3) agree to be bound by the terms of a new limited partnership agreement of the Surviving Partnership. In addition, the issuance of such Series B preferred units must also be exempt from registration under the Securities Act and applicable state and foreign securities laws in order for minority limited partners to elect to receive such Series B preferred units in the Surviving Partnership. Minority limited partners who do not meet any of the requirements described above will only be entitled to receive the cash merger consideration in respect of their Class A partnership units (including Company LTIP units that will be converted, prior to the partnership merger effective time, into Class A partnership units as described above). As described above under the section captioned "The Mergers—Interests of Our Trustees and Executive Officers in the Mergers," certain of our trustees and executive officers beneficially own Class A partnership units and will be offered the opportunity to participate in this election. This proxy statement does not constitute any solicitation of consents in respect of the partnership merger, and does not constitute an offer to exchange or convert the Class A partnership units (including the Company LTIP units that will be converted, prior to the partnership merger effective time, into Class A partnership units as described above) that you may own for or into Series B preferred units in the Surviving Partnership.

        In general, Series B preferred units in the Surviving Partnership will have the following terms:

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Partnership Preferred Units

        Effective as of the closing date, each of the Partnership's 7.125% Series A Cumulative Redeemable Preferred Units (which we refer to as partnership preferred units) held by us will be redeemed, subject to and conditioned upon the occurrence of the closing of the mergers and the redemption of our preferred shares.

General Partnership Interests

        At the partnership merger effective time, each Class A partnership unit outstanding immediately prior to the partnership merger effective time and owned by us will remain outstanding as a general partner interest of the Surviving Partnership. Following the merger effective time, the Surviving Company will be the general partner of the Surviving Partnership and will have such rights, duties and obligations as are more fully set forth in the partnership agreement of the Surviving Partnership, as amended and as further amended in accordance with the terms of the merger agreement.

No Further Ownership Rights

        At the merger effective time and the partnership merger effective time, as applicable, holders of our common shares and the holders of Class A partnership units, respectively, will cease to be, and will have no rights as, our shareholders or limited partners of the Partnership other than the right to receive the merger consideration, without interest or, in the case of holders of Class A partnership units that elect to convert their Class A partnership units into Series B preferred units, such Series B preferred units. The merger consideration paid and, if applicable, Series B preferred units delivered upon the surrender for exchange of certificates representing common shares or Class A partnership

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units will be deemed to have been paid or delivered, as the case may be, in full satisfaction of all rights and privileges pertaining to the common shares or Class A partnership units exchanged therefor.

Exchange and Payment Procedures

        On or before the partnership merger effective time, Parent will deposit, or cause to be deposited, with a paying agent reasonably satisfactory to us, for the benefit of the holders of our common shares and the Class A partnership units, the merger consideration and, if Parent directs the paying agent act as exchange agent with respect to the exchange of Class A partnership units for Series B preferred units, the Series B preferred units, less the merger consideration to be paid in respect of our equity awards as described in "—Treatment of Common Shares, Preferred Shares and Equity Awards" above (but including the merger consideration payable in respect of Class A partnership units upon conversion of Company LTIP units prior to the partnership merger effective time as described above). As soon as possible after the closing date (but in any event within five business days), the paying agent will mail to each holder of record of a certificate or certificates that, immediately prior to the merger effective time, represented outstanding common shares or that, immediately prior to the partnership merger effective time, represented applicable Class A partnership units, a letter of transmittal and instructions for use in effecting the surrender of the certificates or applicable Class A partnership units in exchange for the merger consideration or Series B preferred units, as applicable, to which the holder thereof is entitled. The letter of transmittal and instructions will tell you how to surrender your certificates representing common shares and any applicable Class A partnership units, as applicable, in exchange for the merger consideration or Series B preferred units, as applicable.

        Holders of book-entry common shares or book-entry Class A partnership units will not receive a letter of transmittal for their common shares or Class A partnership units from the paying agent. Instead, holders of such book-entry common shares or book-entry Class A partnership units will automatically be entitled to receive in exchange therefor the merger consideration or Series B preferred units, as applicable, to which the holder thereof is entitled.

        Upon surrender of a certificate that previously represented common shares or applicable Class A partnership units to the paying agent, together with a letter of transmittal, duly executed and completed in accordance with the instructions thereto, and such other documents as may be reasonably be required by the paying agent, the holder of such certificate will be entitled to receive the merger consideration or Series B preferred units, as applicable, payable in respect of the shares of our common shares or applicable Class A partnership units previously represented by such certificate. The merger consideration may be paid and Series B preferred units may be delivered to a person other than the person in whose name the certificate so surrendered is registered in our and the Partnership's transfer records, if any such certificate is properly endorsed or otherwise in proper form for transfer and the person requesting such payment pays any transfer or other taxes or establishes to the reasonable satisfaction of Parent that such tax has been paid or is not applicable.

        No interest will be paid or will accrue on any cash payable upon surrender of any certificate. The Company, the Surviving Company, the Surviving Partnership or the paying agent, as applicable, will be entitled to deduct and withhold from any amounts otherwise payable pursuant to the merger agreement to any person such amounts as it is required to deduct and withhold with respect to the making of such payment (and, with respect to our equity awards, the vesting, cancellation or redemption of such equity awards, as applicable) under the Code, and the rules and regulations promulgated thereunder, or any provision of state, local or foreign tax law, and such amounts deducted or withheld shall be treated as having been paid to the person in respect of which deduction or withholding was made.

        On the closing date, the share transfer books of the Company and the unit transfer books of the Partnership will be closed and thereafter there will be no further registration of transfers of common shares or Class A partnership units.

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        None of Parent, Merger Sub I, the Surviving Company, the Partnership, Merger Sub II, the Surviving Partnership, the Company or the paying agent, or any employee, officer, trustee, director, agent or affiliate thereof, will be liable to any person in respect of any merger consideration or Series B preferred units delivered to a public official pursuant to any applicable abandoned property, escheat or similar law.

        Any portion of the merger consideration and Series B preferred units which remains undistributed to the holders of the certificates or the holders of any common shares or Class A partnership units held in book-entry for twelve months after the closing date will be delivered to the Surviving Company, and any holders of our common shares or Class A partnership units prior to the merger effective time or partnership merger effective time, as applicable, who have not theretofore complied with the exchange and payment procedures contained in the merger agreement must look only to the Surviving Company and only as general creditors thereof for payment of the merger consideration or Series B preferred units, as applicable.

        If any certificate has been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming such certificate to be lost, stolen or destroyed to the reasonable satisfaction of Parent and the paying agent and the taking of such other actions as may be reasonably requested by the paying agent, the paying agent will issue, in exchange for such lost, stolen or destroyed certificate, the merger consideration or Series B preferred units, as applicable, pursuant to the merger agreement.

Representations and Warranties

        We and the Partnership, jointly and severally, have made customary representations and warranties in the merger agreement that are subject, in some cases, to specified exceptions and qualifications contained in the merger agreement or in the disclosure schedules delivered in connection therewith. These representations and warranties relate to, among other things:

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        Many of our representations and warranties are qualified by the concept of a "material adverse effect." Under the terms of the merger agreement, a material adverse effect means any change, event, state of facts or development that has had or would reasonably be expected to have a material adverse effect on (1) the business, financial condition, assets or continuing results of operations of us and our

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subsidiaries, taken as a whole, or (2) the ability of us or the Partnership to consummate the mergers before November 6, 2018; provided, however, that in the case of clause (1), no change, event, state of facts or development resulting from any of the following shall be deemed to be or taken into account in determining whether there has been or will be, a "material adverse effect":

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provided, that (1) with respect to the exceptions set forth in the second, fifth, ninth and eleventh bullet points above, such changes, events, state of facts or developments may be taken into account to the extent they disproportionately adversely affect us and our subsidiaries, taken as a whole, compared to other companies operating in the United States in the industries in which we and our subsidiaries operate and (2) the first and tenth bullet points above do not apply to the references to material adverse effect in certain representations and warranties.

        The merger agreement also contains customary representations and warranties made, jointly and severally, by Parent, Merger Sub I and Merger Sub II that are subject, in some cases, to specified exceptions and qualifications contained in the merger agreement. These representations and warranties relate to, among other things:

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The representations and warranties of each of the parties to the merger agreement will expire upon the closing of the mergers.

Conduct of Our Business Pending the Mergers

        Under the merger agreement, we have agreed that, subject to certain exceptions in the merger agreement and the disclosure schedules delivered in connection therewith, between the date of the merger agreement and the earlier of the closing date and the termination of the merger agreement in accordance with its terms (which period we refer to as the interim period), we will, and will cause our subsidiaries to, in all material respects, use commercially reasonable efforts:

        We have also agreed that during the interim period, subject to certain exceptions set forth in the merger agreement and the disclosure schedules delivered in connection therewith or unless Parent consents in writing (which consent may not be unreasonably withheld, delayed or conditioned), we and our subsidiaries will not, among other things:

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Shareholders' Meeting

        Under the merger agreement, we are required, as soon as reasonably practicable following the date that this proxy statement is cleared by the SEC for mailing to our common shareholders, to duly call, give notice of, convene and hold a meeting of the holders of our common shares for the purpose of seeking shareholder approval of the merger and the other transactions contemplated by the merger agreement, which we refer to as the special meeting. We are required to (1) through our board of trustees, recommend to holders of our common shares that they vote in favor of the merger so that we may obtain the approval the merger and the other transactions contemplated by the merger agreement and (2) use our reasonable best efforts to solicit approval of the merger and the other transactions contemplated by the merger agreement by our common shareholders (including by soliciting proxies from our shareholders), except in each case to the extent that our board of trustees has effected an adverse recommendation change, as permitted by and determined in accordance with the provisions described below under "—Restriction on Solicitation of Company Acquisition Proposals." Unless the merger agreement is terminated in accordance with its terms, we are prohibited from submitting to the vote of our shareholders any company acquisition proposal.

        For purposes of the merger agreement, "company acquisition proposal" means any inquiry, offer or proposal from any person or "group" (as defined in Section 13(d)(3) of the Exchange Act) regarding any of the following (other than the mergers) involving any of us, the Partnership or our respective subsidiaries:

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        Notwithstanding anything to the contrary contained in the merger agreement, we may adjourn or postpone the special meeting:

Under the merger agreement, we must call, give notice of, convene and hold the special meeting and mail this proxy statement to our shareholders without regard to an adverse recommendation change, unless the merger agreement has been terminated in accordance with its terms.

Agreement to Take Certain Actions

        Subject to the terms and conditions of the merger agreement, each party to the merger agreement has agreed to use its reasonable best efforts to consummate the mergers and to cause to be satisfied all conditions precedent to its obligations under the merger agreement, including, consistent with the foregoing,

        Neither we nor our subsidiaries will be permitted to pay or commit to pay to any non-governmental third party any cash or other consideration, make any commitment or incur any liability or other obligation in connection with obtaining any required consent in connection with the transactions contemplated by the merger agreement from any such non-governmental third party unless Parent has provided its prior written consent. In addition, none of Parent or any of its affiliates will be required to pay or commit to pay to such non-governmental third party whose approval or consent is being solicited in connection with the transactions contemplated by the merger agreement any cash or other consideration, make any commitment or incur any liability or other obligations in connection with obtaining any approval or consent from any such non-governmental third party.

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        In addition, in the event that any party fails to obtain any non-governmental third-party consent, the parties to the merger agreement will use commercially reasonable efforts to minimize any adverse effect upon us and Parent and our and their respective affiliates and businesses resulting, or which would reasonably be expected to result, after the partnership merger effective time, from the failure to obtain such non-governmental third-party consent.

        Each party to the merger agreement has agreed to keep the other parties reasonably informed regarding any lawsuit or other legal proceeding relating to or challenging the merger agreement or the consummation of the mergers unless doing so would, in the reasonable judgment of such party, jeopardize any of our or our subsidiaries' privilege with respect thereto. We will promptly advise Parent in writing of the initiation of and any material developments regarding, and will reasonably consult with and permit Parent and its representatives to participate in the defense, negotiations or settlement of, any such lawsuit or other such legal proceeding, and we will give consideration to Parent's advice with respect to such lawsuit or other such legal proceeding. We will not, and will not permit any of our subsidiaries nor any of our or our subsidiaries' representatives to, compromise or settle any such lawsuit or other legal proceeding or consent thereto unless Parent otherwise consents in writing (which will not be unreasonably withheld, conditioned or delayed).

Restriction on Solicitation of Company Acquisition Proposals

        We have agreed that, from and after the date of the merger agreement, except as permitted by certain exceptions described below, we will, and will cause each of our subsidiaries and our and our subsidiaries' officers, trustees and directors to, and will direct our and our subsidiaries' partners, managers, officers, employees, consultants, advisors (including counsel, accountants, investment bankers, experts, consultants and financial advisors), agents and other representatives to, immediately cease any solicitations, discussions, negotiations or communications with any person that may ongoing with respect to any company acquisition proposal.

        We have further agreed that, from the date of the merger agreement until the earlier of the partnership merger effective time and the termination of the merger agreement in accordance with its terms and subject to the provisions described below, we will not, and we will cause our subsidiaries and our and our subsidiaries' officers, trustees and directors not to, and will not authorize and will use commercially reasonable efforts to cause our and our subsidiaries' partners, managers, officers, employees, consultants, advisors (including counsel, accountants, investment bankers, experts, consultants and financial advisors), agents and other representatives not to, directly or indirectly through another person:

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        Prior to the approval of the merger and the other transactions contemplated by the merger agreement by our common shareholders and subject to our compliance with the provisions described above under "—Restriction on Solicitation of Company Acquisition Proposals," if we receive an unsolicited written bona fide company acquisition proposal after the date of the merger agreement by a third party that did not result from a breach of the obligations described above under "—Restriction on Solicitation of Company Acquisition Proposals," if our board of trustees determines in good faith, after consultation with its outside legal counsel and financial advisors, that such company acquisition proposal constitutes or could reasonably be expected to lead to a superior proposal, we or our subsidiaries may:

        We will notify Parent promptly (but in no event later than 48 hours) after receipt of any company acquisition proposal or any request for non-public information regarding us or any of our subsidiaries by any third party that informs us that it is considering making, or has made, a company acquisition proposal, or any other inquiry from any person seeking to have discussions or negotiations with us regarding a possible company acquisition proposal. Such notice will be made in writing and shall identify the person making such company acquisition proposal or inquiry and indicate the material terms and conditions of any company acquisition proposals or inquiries, to the extent known (including, if applicable, providing copies of any written company acquisition proposals or inquiries and any proposed agreements related thereto, which may be redacted to the extent necessary to protect confidential information of the business or operations of the person making such company acquisition proposal or inquiry). We will also promptly, and in any event within 48 hours, notify Parent in writing if we enter into discussions or negotiations concerning any company acquisition proposal or provide nonpublic information to any person, notify Parent of any change to the financial and other material terms and conditions of any company acquisition proposal and otherwise keep Parent reasonably informed of the status and terms of any company acquisition proposal or inquiry on a reasonably current basis, including by providing a copy of all written proposals, offers, drafts of proposed agreements or correspondence relating thereto. Neither we nor any of our subsidiaries may, after the date of the merger agreement, enter into any confidentiality or similar agreement that would prohibit us from providing such information to Parent.

        For purposes of the merger agreement, "superior proposal" means a bona fide written company acquisition proposal (except that each reference to "15%" in the definition of "company acquisition proposal" will be replaced by "50%") made by a third party on terms that our board of trustees determines in good faith, after consultation with our outside legal counsel and financial advisors, (1) would result, if consummated, in a transaction that is more favorable to our shareholders (solely in their capacity as such) from a financial point of view than the merger and (2) is reasonably likely to be consummated, after taking into account the financial, legal, regulatory and any other aspects of such proposal, the likelihood and timing of consummation (as compared to the merger) and any changes to the terms of the merger agreement proposed by Parent and any other information provided by Parent.

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        In addition, the merger agreement provides that we may not, nor may we permit any of our subsidiaries to, terminate, waive, amend or modify any provision of any standstill or confidentiality agreement to which we or any of our subsidiaries is a party, except solely to allow the applicable party to make a non-public company acquisition proposal to our board of trustees or to allow the disclosure of information to financing sources and/or teaming arrangements. The merger agreement also provides that neither we nor our board of trustees will take any actions to exempt any person from the "Common Share Ownership Limit" or the "Preferred Share Ownership Limit" or establish or increase an "Excepted Holder Limit," as such terms are defined in our declaration of trust, unless such actions are taken concurrently with the termination of the merger agreement in accordance with the provisions described in the first bullet point of the section below entitled "—Termination of the Merger Agreement—Termination by the Company."

Obligation of the Board of Trustees with Respect to Its Recommendation

        Except in the circumstances and pursuant to the procedures described below, neither our board of trustees nor any committee thereof will:

We refer to any action described in the first three bullet points above as an "adverse recommendation change."

        Prior to the approval of the merger and the other transactions contemplated by the merger agreement by our common shareholders, our board of trustees may effect an adverse recommendation change and/or terminate the merger agreement to enter into a definitive agreement providing for the implementation of a superior proposal:

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        For purposes of the merger agreement, "intervening event" means a material event, development or change in circumstances with respect to us and our subsidiaries, taken as a whole, that occurred or arose after the date of the merger agreement, which was unknown to, nor reasonably foreseeable by, our board of trustees as of or prior to the date of the merger agreement, and becomes known to or by our board of trustees prior to the approval of the merger and the other transactions contemplated by the merger agreement by our common shareholders. Notwithstanding the foregoing, none of the following will constitute, or be considered in determining whether there has been, an intervening event:

        Any amendment to the financial terms or any other material amendment of such a superior proposal will require a new notice of change of recommendation, and we will be required to comply again with the requirements described above, except that the notice of change period will be reduced to two business days following receipt by Parent of any such new notice of change of recommendation.

        Nothing contained in the merger agreement will prohibit us or our board of trustees from taking and disclosing to our shareholders a position contemplated by Rule 14e-2(a), Rule 14d-9 or Item 1012(a) of Regulation M-A promulgated under the Exchange Act or from making any disclosure to our shareholders that is required by applicable law or if our board of trustees determines in good faith, after consultation with outside legal counsel, that the failure to make such disclosure would reasonably be expected to be inconsistent with our trustees' duties under applicable law, provided, however, that neither we nor our board of trustees will be permitted to recommend that our

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shareholders tender any securities in connection with any tender offer or exchange offer that is a company acquisition proposal or otherwise effect an adverse recommendation change with respect thereto, except as permitted by the provisions described above.

Employee Benefits

        From and after the merger effective time and for a period ending on the first anniversary of the merger effective time (or, if shorter, during any applicable period of employment), each of our and our subsidiaries' employees who is employed immediately prior to the merger effective time, each of which we refer to as a company employee, will be entitled to receive (1) a base salary or wage at a rate, as applicable, that is no less favorable than the base salary or wage rate in effect with respect to such company employee immediately prior to the merger effective time, (2) an annual cash bonus opportunity that is no less favorable than the annual cash bonus opportunity provided to such company employee immediately prior to the merger effective time, and (3) other compensation and benefits (including severance benefits, paid time off and health insurance, but excluding equity-based compensation and long-term incentive compensation) that are substantially comparable, in the aggregate, to the other compensation and benefits provided to such company employee immediately prior to the merger effective time. Parent will, or will cause its designated subsidiary to, assume and honor the terms of the employment agreements with Messrs. DuGan, Harris, Pell and Clark and the severance policy described below, without amendment. The foregoing will not require that any company employee remain employed for any period after the closing of the mergers nor that any compensation or benefits be provided after a company employee ceases to be employed (other than vested rights and benefits in effect at the time of such cessation of employment and certain severance benefits). For the employee benefit plans of Parent and its subsidiaries providing any benefits to any company employee after the merger effective time, each company employee will be credited with his or her years of service with us and our subsidiaries and our and their respective predecessors as if such service were with Parent or an applicable subsidiary, provided that the foregoing will not apply for purposes of benefit accrual under defined benefit plans or to the extent that its application would result in a duplication of benefits or to the extent the we did not provide such service credit under any comparable plan, program or benefit.

        All limitations as to preexisting conditions, exclusions, actively at work requirements, waiting periods or any other restriction that would prevent immediate or full participation of company employees under Parent's or any of its subsidiaries' health and welfare plans will be waived by Parent and its subsidiaries, other than limitations, exclusions, actively at work requirements, waiting periods or other restrictions that are already in effect with respect to such company employees and that have not been satisfied as of the closing date under any company employee benefit plan. Any and all evidence of insurability requirements with respect to such company employees to the extent such evidence of insurability requirements were not applicable to the company employees under the comparable company benefit plan immediately prior to the closing of the mergers will be waived by Parent and its subsidiaries. Additionally, each company employee and his or her dependents will be provided with full credit for any co-payments and deductibles satisfied prior to the closing date for the plan year within which the merger effective time occurs in order to satisfy any applicable deductible or out-of-pocket requirements, and for any lifetime maximums, under any welfare plans that such company employees are eligible to participate in after the closing date.

        The merger agreement provides that we may establish a cash retention program, pursuant to which all of our employees will be eligible to receive a retention bonus (which we refer to as the retention bonuses); provided that certain executives with employment agreements and certain members of senior management will not be eligible for a retention bonus. The amount of the retention bonus payable to each recipient (which we refer to as the retention recipients) will equal 20% of his or her annual base salary in effect as of the date hereof, subject to a $100,000 individual maximum. The retention bonuses

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will be paid in two equal installments on each of the closing date and March 31, 2019, subject to the retention recipient's continued service to us or our affiliate or successor through such date. Retention bonuses will be forfeited upon the retention recipient's termination of employment for any reason prior to payment.

        In addition, the merger agreement provides that we may establish a change in control severance policy (which we refer to as the severance policy). Conditioned on the execution and nonrevocation of a general release of claims in favor of us, upon a termination without "cause" or resignation with "good reason" (as each is defined in the severance policy), the severance policy provides participants with the following severance benefits: (i) a prorated bonus for the current fiscal year based on actual performance, to be paid on the 30th day following the participant's termination date if the participant is terminated in 2018 and at the time bonuses are paid to actively employed employees if the participant is terminated in 2019 and (ii) a lump-sum cash payment payable on the 30th day following the participant's termination date equal to the sum of (a) 12 months' of COBRA premium subsidies and (b) a payment that varies based on years of service, which ranges from six to 18 months of the participant's base salary (or, for certain designated members of senior management, a multiple of the sum of the participant's base and prior year's bonus). Certain participants will also be entitled to three months of outplacement services.

        The merger agreement further provides that we may grant cash transaction incentive awards (which we refer to as the discretionary bonuses) with an aggregate value of up to $2.5 million, with any such discretionary bonuses to be paid in full on the closing date. The discretionary bonuses will be allocated among our employees in the amounts and on the terms determined by our board of trustees (or the compensation committee thereof). If a discretionary bonus is forfeited by an employee, our board of trustees or the compensation committee thereof may reallocate the award to our existing employees or new hires.

Financing Cooperation

        The consummation of the mergers is not conditioned upon Parent's receipt of financing. Pursuant to the merger agreement, Parent may disclose non-public information to potential purchasers (and their financing sources) of certain of our and our subsidiaries' properties or our subsidiaries that directly or indirectly own such properties. Parent must not require any such potential purchasers to, and Parent will require that any such potential purchasers (and their affiliates) not, enter into any exclusivity, lock-up or other agreement, arrangement or understanding, whether written or oral, with any financing source without our prior written consent that may reasonably be expected to limit, restrict, restrain or otherwise impair in any manner, directly or indirectly, the ability of such financing source to provide financing or other assistance to any other person in connection with a company acquisition proposal. In addition, Parent must not restrict any such potential purchasers from engaging in discussions or entering into agreements with us or our subsidiaries.

        Subject to applicable law, prior to the closing of the mergers, we will, and will cause our subsidiaries to, and will use commercially reasonable efforts to cause our and our subsidiaries' representatives to, provide all customary cooperation reasonably requested in writing by Parent in connection with Parent arranging financing with respect to us, our subsidiaries or our or any of our subsidiaries' properties (which we refer to as the debt financing), including by using commercially reasonable efforts to:

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Nothing in the merger agreement will, however, require us or any of our subsidiaries or any of our or any of our subsidiaries' representatives to take any action to the extent it would:

Pre-Closing Transactions

        In addition, the merger agreement requires that we use commercially reasonable efforts to provide such cooperation and assistance as Parent may reasonably request to (1) convert any of our wholly owned subsidiaries organized as a corporation or limited partnership into a limited liability company on the basis of organizational documents as reasonably requested by Parent, (2) sell or cause to be sold stock, partnership interests or limited liability interests owned, directly or indirectly, by us in any wholly owned subsidiary on terms designated by Parent, or (3) exercise any of our or our subsidiaries' rights to terminate or cause to be terminated any contract to which we or one of our wholly-owned subsidiaries

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is a party and (4) sell or cause to be sold any of our or our wholly owned subsidiaries' assets on terms designated by Parent.

        These rights of Parent are limited, however, in that (1) Parent may not require us or any of our subsidiaries to take any action that contravenes any of our or any of our subsidiaries' organizational documents, material contracts or applicable law, (2) any such conversions, exercises of any rights of termination or other terminations, sales or transactions must be contingent upon all conditions to the mergers under the merger agreement having been satisfied or waived and our receipt of a written notice from Parent to such effect and that Parent, Merger Sub I and Merger Sub II are prepared to proceed immediately with the closing of the mergers and any other evidence reasonably requested by us that the closing of the mergers will occur, (3) these actions (or the inability to complete them) will not affect or modify the obligations of Parent, Merger Sub I and Merger Sub II under the merger agreement, including the amount of or timing of the payment of the merger consideration, (4) we and our subsidiaries will not be required to take any action that could adversely affect our classification, or the classification of any of our subsidiaries that is classified as a REIT, as a REIT within the meaning of the Code or that could subject us or any such subsidiary to any "prohibited transactions" taxes or certain other material taxes under the Code (or other material entry-level taxes), and (5) we and our subsidiaries will not be required to take any such action that could result in any U.S. federal, state or local income tax being imposed on any holder of Class A partnership units other than us or any of our subsidiaries. Parent will, promptly upon our request, reimburse us for all reasonable out-of-pocket costs incurred by us or our subsidiaries in connection with our or our subsidiaries' performance of these obligations.

Certain Other Covenants

        The merger agreement contains certain other covenants of the parties to the merger agreement relating to, among other things:

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Conditions to the Mergers

        The obligations of the parties to complete the mergers are subject to the satisfaction or waiver of the following mutual conditions:

        The obligations of Parent, Merger Sub I and Merger Sub II to complete the mergers are further subject to the satisfaction or waiver of the following conditions:

        Our and the Partnership's obligations to complete the mergers are further subject to the satisfaction or waiver of the following conditions:

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Termination of the Merger Agreement

        We and Parent may mutually agree to terminate and abandon the merger agreement at any time prior to the closing date, even after we have obtained the requisite vote of our common shareholders to approve the merger and the other transactions contemplated by the merger agreement.

Termination by either the Company or Parent

        In addition, we, on the one hand, or Parent, on the other hand, may terminate and abandon the merger agreement by written notice to the other at any time prior to the closing date, even after we have obtained the requisite vote of our common shareholders to approve the merger and the other transactions contemplated by the merger agreement, if:

Termination by the Company

        We may also terminate and abandon the merger agreement by written notice to Parent at any time prior to the closing date, even after we have obtained the requisite vote of our common shareholders to approve the merger and the other transactions contemplated by the merger agreement, if:

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Termination by Parent

        Parent may also terminate and abandon the merger agreement by written notice to us at any time prior to the closing date, even after we have obtained the requisite vote of our common shareholders to approve the merger and the other transactions contemplated by the merger agreement, if:

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Termination Fees

Termination Fee Payable by the Company

        We have agreed to pay the company termination fee of $138 million as directed by Parent if:

However, the company termination fee will equal $46 million if the merger agreement is terminated by us pursuant to the provisions described in the first bullet point under "—Termination of the Merger Agreement—Termination by the Company" in order to enter into a definitive agreement with an excluded party providing for the implementation of a superior proposal (which we refer to as an excluded party termination).

        An "excluded party" is a person or group of persons that submitted a written bona fide company acquisition proposal to us after the date of the merger agreement and prior to June 20, 2018 that our board of trustees determines prior to June 20, 2018, after consultation with outside legal counsel and financial advisors, constitutes, or could reasonably be expected to lead to, a superior proposal if:

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However, any such person or group of persons will cease to be an excluded party upon the earliest to occur of the following:

        An "excluded party notice period" means, with respect to an excluded party, a period of three business days commencing upon the expiration of the first notice of change period with respect to our intention to undertake an excluded party termination with respect to a qualified proposal that was submitted by such excluded party and that our board of trustees has determined constitutes a superior proposal in accordance with the procedures described in the section titled "—Obligation of the Board of Trustees with Respect to its Recommendation". However, if any new notice of change period is commenced before the expiration of the prior excluded party notice period with respect to our intention to undertake an excluded party termination with respect to such superior proposal, as materially revised, then a new excluded party notice period of two business days will commence upon the expiration of such new notice of change period (and another new excluded party notice period of two business days will commence upon the expiration of any further such new notice of change period that commences at or before the expiration of the prior excluded notice period).

        If an excluded party notice period expires without a new notice of change period having commenced at or before such expiration, there will be no further excluded party notice periods with respect to such excluded party.

Termination Fee Payable by Parent

        Parent has agreed to pay to us the parent termination fee of $414 million if we terminate the merger agreement pursuant to the provisions described in the second bullet point or third bullet point under "—Termination of the Merger Agreement—Termination by the Company."

Guaranty and Remedies

        In connection with the merger agreement, the Sponsor entered into a guaranty in our favor to guarantee Parent's payment obligations with respect to the parent termination fee and certain expense

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reimbursement and indemnification obligations of Parent under the merger agreement, subject to the terms and limitations set forth in the guaranty.

        The maximum aggregate liability of the Sponsor under the guaranty will not exceed $414 million, plus all reasonable and documented third party costs and out-of-pocket expenses (including reasonable fees of counsel) actually incurred by us relating to any litigation or other proceeding brought by us to enforce our rights under the guaranty, if we prevail in such litigation or proceeding.

        We and the Partnership cannot seek specific performance to require Parent, Merger Sub I or Merger Sub II to complete the mergers and, subject to limited exceptions, including with respect to enforcing confidentiality provisions and certain expense reimbursement and indemnification obligations of Parent, our sole and exclusive remedy against Parent, Merger Sub I or Merger Sub II relating to any breach of the merger agreement or otherwise will be the right to receive the parent termination fee under the conditions described under "—Termination Fees—Termination Fee Payable by Parent." Parent, Merger Sub I and Merger Sub II may, however, seek specific performance to require us and the Partnership to complete the mergers.

Amendment and Waiver

        The merger agreement may be amended by action taken by the parties at any time before or after our common shareholders have approved the merger and the other transactions contemplated by the merger agreement but, after such approval, no amendment may be made which requires the approval of any such shareholders under applicable law without obtaining such further approvals. The merger agreement also provides that, at any time prior to the closing date, each party may extend the time for the performance of any of the obligations or other acts of the other parties, waive any breaches or inaccuracies in the representations and warranties of the other parties, or waive compliance by the other parties with any of the agreements or conditions contained in the merger agreement.

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MARKET PRICE OF OUR COMMON SHARES

        Our common shares are listed on the NYSE under the trading symbol "GPT." On June 26, 2018, there were approximately 1,511 holders of record. Certain of our common shares are held in "street" name and accordingly, the number of beneficial owners of such shares is not known or included in the foregoing number. The table below sets forth the quarterly high and low closing sales prices of our common shares on the NYSE for the periods indicated and the dividends declared by us with respect to the periods indicated. All share and per share data has been adjusted for the 1-for-3 reverse share split that was effective after the close of trading on December 30, 2016.

 
  Range    
 
 
  Cash
Dividend per
Share
 
Year
  High   Low  

Fiscal Year Ended December 31, 2016

                   

First Quarter

  $ 25.47   $ 20.40   $ 0.330  

Second Quarter

  $ 27.66   $ 24.90   $ 0.330  

Third Quarter

  $ 29.97   $ 27.39   $ 0.330  

Fourth Quarter

  $ 28.59   $ 24.15   $ 0.375  

Fiscal Year Ended December 31, 2017

                   

First Quarter

  $ 28.25   $ 25.37   $ 0.375  

Second Quarter

  $ 30.96   $ 26.52   $ 0.375  

Third Quarter

  $ 30.92   $ 28.74   $ 0.375  

Fourth Quarter

  $ 31.10   $ 26.66   $ 0.375  

Fiscal Year Ending December 31, 2018

                   

First Quarter

  $ 26.87   $ 21.38   $ 0.375  

Second Quarter (through June 26, 2018)

  $ 27.68   $ 21.37   $ 0.375 (1)

(1)
Quarterly dividend to be paid on July 16, 2018.

        On May 4, 2018, the last trading day prior to the date of the public announcement of the merger agreement, the reported closing price per share for our common shares on the NYSE was $23.82. On June 26, 2018, the last trading day before the date of this proxy statement, the reported closing price per share for our common shares on the NYSE was $27.63. You are encouraged to obtain current market quotations for our common shares.

        On April 30, 2018, our board of trustees declared, a regular quarterly dividend of $0.3750 per common share for the quarter ended June 30, 2018, which will be paid on July 16, 2018 to shareholders of record at the close of business on June 29, 2018. Under the terms of the merger agreement, we may not authorize, declare or pay any other dividends to the holders of our common shares during the term of the merger agreement without the prior written consent of Parent, other than dividends reasonably required to maintain our status as a REIT under the Code or to avoid the payment of income or excise tax (with any such additional required dividend resulting in a corresponding decrease to the merger consideration). However, if the mergers are consummated after October 15, 2018, holders of our common shares will receive, for each outstanding common share, a per diem amount of approximately $0.004 in cash for each day from and after such date until (but not including) the closing date, without interest and less any applicable withholding taxes. Such amount is meant to approximate the daily accrual of our regular quarterly dividend of $0.375 per common share, commencing October 15, 2018.

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

        The following table sets forth the beneficial ownership of our common shares, as of June 1, 2018, for (1) each person known to us to be the beneficial owner of more than 5% of our outstanding common shares based on the Schedule 13D, Schedule 13G, or any amendments thereto, filed with the SEC, (2) each of our trustees and nominees for trustee, (3) each of our named executive officers who is not a trustee and (4) our trustees, nominees for trustee and executive officers as a group.

        In accordance with SEC rules, each listed person's beneficial ownership includes:

        Except as otherwise described in the notes below, the following beneficial owners own all shares directly and have sole voting power and sole investment power with respect to all common shares set forth opposite their respective names.

Name and Address**
  Shares
Owned(1)
  Percentage

Trustees and Executive Officers:

         

Charles E. Black

    77,504   *

Gordon F. DuGan

    866,475   *

Allan J. Baum

    71,968 (2) *

Z. Jamie Behar

    8,498   *

Thomas D. Eckert

    65,407 (3) *

James L. Francis

    14,686   *

Gregory F. Hughes

    19,889 (4) *

Jeffrey E. Kelter

    98,757 (5) *

Louis P. Salvatore

    20,003   *

Benjamin P. Harris

    254,608   *

Nicholas L. Pell

    219,168   *

Jon W. Clark

    73,615   *

Edward J. Matey Jr. 

    68,242   *

All current executive officers and trustees as a group (13 persons)

    1,858,819   1.11%

5% or Greater Owners:

         

The Vanguard Group, Inc.(6)

    24,646,030   15.33%

BlackRock, Inc.(7)

    14,397,948   9.00%

Vanguard Specialized Funds(8)

    10,228,339   6.36%

*
Less than 1%.

**
Unless otherwise indicated, the business address is 90 Park Avenue, 32nd Floor, New York, NY 10016.

(1)
Beneficial ownership is determined in accordance with Rule 13d-3 of the Exchange Act. A person is deemed to be the beneficial owner of any common shares if that person has or shares voting power or investment power with respect to those shares, or has the right to acquire beneficial ownership at any time within 60 days of the date of the table. As used herein, "voting power" is the power to vote or direct the voting of shares and

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(2)
Includes 28,176 shares issuable upon exercise of options.

(3)
Includes 1,329 shares issuable upon exercise of options.

(4)
Includes 3,987 shares issuable upon exercise of options.

(5)
Includes 34,821 shares issuable upon exercise of options.

(6)
Based solely on information provided on a Schedule 13G/A filed by the Vanguard Group, Inc., on behalf of itself and certain of its affiliates, with the SEC on February 7, 2018. The business address of the Vanguard Group, Inc. is 100 Vanguard Blvd., Malvern, PA 19355.

(7)
Based solely on information provided on a Schedule 13G filed by BlackRock, Inc., on behalf of itself and certain of its affiliates, with the SEC on January 24, 2018. The business address of BlackRock, Inc. is 55 East 52nd Street, New York, NY 10055.

(8)
Based solely on information provided on a Schedule 13G/A filed by Vanguard Specialized Funds—Vanguard REIT Index Fund—23-2834924, on behalf of itself and certain of its affiliates, with the SEC on February 1, 2018. The business address of Vanguard Specialized Funds—Vanguard REIT Index Fund—23-2834924 is 100 Vanguard Blvd., Malvern, PA 19355.

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NO DISSENTERS' RIGHTS OF APPRAISAL

        We are organized as a real estate investment trust under Maryland law. Holders of our common shares may not exercise any appraisal rights, dissenters' rights or the rights of an objecting shareholder to receive the fair value of the shareholder's shares in connection with the merger because, as permitted by the Maryland REIT Law, our declaration of trust provides that shareholders are not entitled to exercise such rights unless our board of trustees, upon the affirmative vote of a majority of the entire board, determines that the rights apply. Our board of trustees has made no such determination. However, our common shareholders can vote against the merger and the other transactions contemplated by the merger agreement.


SHAREHOLDER PROPOSALS

        Our 2018 annual meeting of shareholders was held on June 12, 2018. We intend to hold an annual meeting of shareholders in 2019 only if the mergers are not completed. If we hold such an annual meeting, shareholder proposals intended to be presented at the 2019 annual meeting of shareholders must be received by our Secretary no later than December 31, 2018 in order to be considered for inclusion in our proxy statement relating to the 2019 meeting pursuant to Rule 14a-8 under the Exchange Act.

        For a proposal of a shareholder to be properly presented at the 2019 annual meeting of shareholders, other than a shareholder proposal included in the proxy statement pursuant to Rule 14a-8, such proposal must be received at our principal executive offices after December 4, 2018 and on or before January 3, 2019, unless the 2019 annual meeting of shareholders is scheduled to take place before May 13, 2019 or after July 12, 2019. Under our bylaws, shareholders must follow certain procedures to nominate a person for election as a trustee at an annual or special meeting, or to introduce an item of business at an annual meeting. A shareholder must notify our Secretary in writing of the trustee nominee or the other business. To be timely under our current bylaws, the notice must be delivered to our Secretary, along with the appropriate supporting documentation, as applicable, at our principal executive office not less than 120 days nor more than 150 days prior to the first anniversary of the date of preceding year's annual proxy; provided, however, that in the event that the date of the annual meeting is advanced or delayed by more than 30 days from the first anniversary of the prior year's annual meeting, notice by the shareholder to be timely must be so delivered not earlier than the 150th day prior to such annual meeting and not later than the 5:00 p.m., Eastern Time, on the later of the 120th day prior to such annual meeting, as originally convened, or the 10th day following the day on which public announcement of the date of such meeting is first made. Any such proposal should be mailed to our principal executive offices at: Gramercy Property Trust, 90 Park Avenue, 32nd Floor, New York, New York 10016, Attention: Edward J. Matey Jr., Secretary.


HOUSEHOLDING OF PROXY MATERIALS

        The SEC has adopted rules that permit companies and intermediaries (such as banks and brokers) to satisfy the delivery requirements for proxy statements and annual reports with respect to two or more shareholders sharing the same address by delivering a single proxy statement addressed to those shareholders. This process, which is commonly referred to as "householding," potentially means extra convenience for shareholders and cost savings for companies.

        A number of brokers with account holders who are our shareholders will be "householding" our proxy materials. A single proxy statement will be delivered to multiple shareholders sharing an address unless contrary instructions have been received from the impacted shareholders. Once you have received notice from your broker that they will be "householding" communications to your address, "householding" will continue until you are notified otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in "householding" and would prefer to receive a separate

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proxy statement and annual report, please notify us, by calling (212) 297-1000 or by directing your written request to: Gramercy Property Trust, 90 Park Avenue, 32nd Floor, New York, New York 10016, Attention: Edward J. Matey Jr., Secretary. Pursuant to such request, the Company will undertake to promptly deliver a separate copy of the proxy statement or annual report, as applicable, to you. Shareholders who currently receive multiple copies of the proxy statement at their address and would like to request "householding" of their communications should contact their broker as specified above.


OTHER MATTERS

        Pursuant to our bylaws, only the matters set forth in the Notice of Special Meeting may be brought before the special meeting.


WHERE YOU CAN FIND MORE INFORMATION

        We file annual, quarterly and current reports, proxy statements and other information with the SEC. You may read and copy any document we file with the SEC at the public reference room of the SEC, 100 F Street, N.E., Washington, D.C. 20549. Information about the operation of the public reference room may be obtained by calling the SEC at 1-800-SEC-0330. Our SEC filings, including this proxy statement, are also available to you on the SEC's website at http://www.sec.gov.

        The SEC allows us to "incorporate by reference" the information we file with the SEC, which means that we can disclose important information to you by referring to those documents. The information incorporated by reference is an important part of this proxy statement. The incorporated documents contain significant information about us, our business and our finances. Any information contained in this proxy statement or in any document incorporated or deemed to be incorporated by reference in this proxy statement will be deemed to have been modified or superseded to the extent that a statement contained in this proxy statement, or in any other document we subsequently file with the SEC that also is incorporated or deemed to be incorporated by reference in this proxy statement, modifies or supersedes the original statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to be a part of this proxy statement. We incorporate by reference the following documents we filed with the SEC:

        To the extent that any information contained in any Current Report on Form 8-K, or any exhibit thereto, is or was furnished to, rather than filed with, the SEC, such information or exhibit is specifically not incorporated by reference in this proxy statement.

        We will provide without charge to each person, including any beneficial owner of our common shares, to whom a proxy statement is delivered, on written or oral request of that person, a copy of any or all of the documents we are incorporating by reference into this proxy statement, other than exhibits to those documents unless those exhibits are specifically incorporated by reference into those documents. A request should be addressed to Gramercy Property Trust, 90 Park Avenue, 32nd Floor,

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New York, New York 10016, Attention: Edward J. Matey Jr., Secretary or by telephone at (212) 297-1000.

        If you have any questions about this proxy statement, the special meeting or the mergers, or if you would like additional copies of this proxy statement, please contact us at:

Gramercy Property Trust
90 Park Avenue, 32nd Floor
New York, New York 10016
Attention: Edward J. Matey Jr., Secretary
(212) 297-1000

        YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN OR INCORPORATED BY REFERENCE IN THIS PROXY STATEMENT TO VOTE YOUR COMMON SHARES AT THE SPECIAL MEETING. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION THAT IS DIFFERENT FROM, OR IN ADDITION TO, WHAT IS CONTAINED IN THIS PROXY STATEMENT OR IN ANY OF THE MATERIALS THAT ARE INCORPORATED BY REFERENCE IN THIS PROXY STATEMENT. THIS PROXY STATEMENT IS DATED JUNE 27, 2018. YOU SHOULD NOT ASSUME THAT THE INFORMATION CONTAINED IN THIS PROXY STATEMENT IS ACCURATE AS OF ANY DATE OTHER THAN THAT DATE, UNLESS THE INFORMATION SPECIFICALLY INDICATES THAT ANOTHER DATE APPLIES, AND THE MAILING OF THIS PROXY STATEMENT TO COMPANY SHAREHOLDERS DOES NOT CREATE ANY IMPLICATION TO THE CONTRARY.

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Exhibit A

EXECUTION VERSION




AGREEMENT AND PLAN OF MERGER

DATED AS OF MAY 6, 2018

BY AND AMONG

GRAMERCY PROPERTY TRUST,

GPT OPERATING PARTNERSHIP LP,

BRE GLACIER PARENT L.P.,

BRE GLACIER L.P.

AND

BRE GLACIER ACQUISITION L.P.





Table of Contents

ARTICLE I. THE MERGERS     A-2  
    Section 1.1   The Mergers     A-2  
    Section 1.2   Governing Documents     A-3  
    Section 1.3   Officers, General Partner and Limited Partners of the Surviving Entities     A-3  
    Section 1.4   Effective Times     A-4  
    Section 1.5   Closing of the Mergers     A-4  
    Section 1.6   Effects of the Mergers     A-5  
    Section 1.7   Tax Consequences     A-5  

ARTICLE II. MERGER CONSIDERATION; COMPANY SHARES; PARTNERSHIP UNITS

 

 

A-5

 
    Section 2.1   Company Share Merger Consideration; Effect on Company Shares     A-5  
    Section 2.2   Partnership Unit Merger Consideration; Effect on Partnership Units     A-6  
    Section 2.3   Treatment of Equity-Based Awards     A-8  
    Section 2.4   Exchange of Certificates     A-10  
    Section 2.5   Exchange Procedures     A-11  
    Section 2.6   Withholding Rights     A-13  
    Section 2.7   Dissenters' Rights     A-13  
    Section 2.8   Adjustment of Per Company Share Merger Consideration, Per Partnership Unit Merger Consideration or New Partnership Preferred Units     A-13  

ARTICLE III. REPRESENTATIONS AND WARRANTIES OF THE COMPANY PARTIES

 

 

A-13

 
    Section 3.1   Organization and Qualification; Subsidiaries     A-14  
    Section 3.2   Capitalization     A-14  
    Section 3.3   Authority     A-16  
    Section 3.4   No Conflict; Required Filings and Consents     A-17  
    Section 3.5   Company SEC Documents; Financial Statements     A-18  
    Section 3.6   Information Supplied     A-19  
    Section 3.7   Absence of Certain Changes     A-19  
    Section 3.8   Undisclosed Liabilities     A-19  
    Section 3.9   Permits; Compliance with Laws     A-20  
    Section 3.10   Litigation     A-20  
    Section 3.11   Employee Benefits     A-21  
    Section 3.12   Labor Matters     A-22  
    Section 3.13   Tax Matters     A-23  
    Section 3.14   Real Property     A-25  
    Section 3.15   Environmental Matters     A-28  
    Section 3.16   Intellectual Property     A-28  
    Section 3.17   Contracts     A-29  
    Section 3.18   Opinion of Financial Advisor     A-30  
    Section 3.19   Takeover Statutes     A-30  
    Section 3.20   Vote Required     A-30  
    Section 3.21   Insurance     A-31  
    Section 3.22   Investment Company Act     A-31  
    Section 3.23   Brokers     A-31  
    Section 3.24   Acknowledgement of No Other Representations or Warranties     A-31  

ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF PARENT, MERGER SUB I AND MERGER SUB II

   
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    Section 4.1   Organization     A-32  
    Section 4.2   Authority     A-33  
    Section 4.3   No Conflict; Required Filings and Consents     A-33  

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    Section 4.4   Litigation     A-34  
    Section 4.5   Brokers     A-34  
    Section 4.6   Information Supplied     A-34  
    Section 4.7   Merger Sub I and Merger Sub II     A-34  
    Section 4.8   Sufficient Funds     A-35  
    Section 4.9   Guaranty     A-36  
    Section 4.10   Solvency     A-36  
    Section 4.11   Absence of Certain Arrangements     A-36  
    Section 4.12   Acknowledgement of No Other Representations and Warranties     A-36  

ARTICLE V. COVENANTS AND AGREEMENTS

 

 

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    Section 5.1   Conduct of Business by the Company Pending the Mergers     A-37  
    Section 5.2   Access to Information     A-41  
    Section 5.3   Proxy Statement     A-42  
    Section 5.4   Company Shareholders' Meeting     A-43  
    Section 5.5   Appropriate Action; Consents; Filings     A-44  
    Section 5.6   Solicitation; Acquisition Proposals; Adverse Recommendation Change     A-45  
    Section 5.7   Public Announcements     A-48  
    Section 5.8   Trustees' and Officers' Indemnification     A-48  
    Section 5.9   Employee Matters     A-50  
    Section 5.10   Notification of Certain Matters     A-51  
    Section 5.11   Dividends     A-51  
    Section 5.12   Other Transactions; Parent-Approved Transactions     A-51  
    Section 5.13   Taxes     A-53  
    Section 5.14   Rule 16b-3 Matters     A-53  
    Section 5.15   Preferred Share Redemptions     A-53  
    Section 5.16   Cooperation Regarding Existing Loans     A-54  
    Section 5.17   Financing and Cooperation     A-55  

ARTICLE VI. CONDITIONS TO CONSUMMATION OF THE MERGERS

 

 

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    Section 6.1   Conditions to Each Party's Obligations to Effect the Mergers     A-57  
    Section 6.2   Conditions to the Obligations of Parent, Merger Sub I and Merger Sub II     A-58  
    Section 6.3   Conditions to Obligations of the Company and the Partnership     A-59  
    Section 6.4   Frustration of Closing Conditions     A-59  

ARTICLE VII. TERMINATION

 

 

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    Section 7.1   Termination     A-59  
    Section 7.2   Effect of the Termination     A-61  
    Section 7.3   Fees and Expenses     A-61  

ARTICLE VIII. MISCELLANEOUS

 

 

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    Section 8.1   Nonsurvival of Representations and Warranties     A-63  
    Section 8.2   Entire Agreement; Assignment     A-63  
    Section 8.3   Notices     A-63  
    Section 8.4   Governing Law and Venue; Waiver of Jury Trial     A-64  
    Section 8.5   Interpretation; Certain Definitions     A-65  
    Section 8.6   Parties In Interest     A-66  
    Section 8.7   Severability     A-66  
    Section 8.8   Specific Performance     A-66  
    Section 8.9   Amendment     A-68  
    Section 8.10   Extension; Waiver     A-68  
    Section 8.11   Counterparts     A-68  
    Section 8.12   Definitions     A-69  

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AGREEMENT AND PLAN OF MERGER

              THIS AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated as of May 6, 2018, is by and among Gramercy Property Trust, a Maryland real estate investment trust (the "Company"), BRE Glacier Parent L.P., a Delaware limited partnership ("Parent"), BRE Glacier L.P., a Delaware limited partnership ("Merger Sub I"), BRE Glacier Acquisition L.P., a Delaware limited partnership ("Merger Sub II"), and GPT Operating Partnership LP, a Delaware limited partnership (the "Partnership").

W I T N E S S E T H:

              WHEREAS, the parties wish to effect a business combination through (i) a merger of Merger Sub II with and into the Partnership, with the Partnership being the surviving entity (the "Partnership Merger"), on the terms and subject to the conditions set forth in this Agreement and in accordance with the Delaware Revised Uniform Limited Partnership Act, as amended (the "DRULPA") and (ii) immediately following the consummation of the Partnership Merger, a merger of the Company with and into Merger Sub I, with Merger Sub I being the surviving entity (the "Company Merger" and, together with the Partnership Merger, the "Mergers"), on the terms and subject to the conditions set forth in this Agreement and in accordance with the DRULPA and the Maryland REIT Law, as amended (the "MRL");

              WHEREAS, the Company is the sole general partner and a limited partner of the Partnership through which the Company operates its business, and, as of the date hereof, the Company owns approximately 96.8% of the outstanding Class A Units of the Partnership (the "Class A Partnership Units" and, together with the Company LTIP Units, the "Partnership Units") and 100% of the outstanding 7.125% Series A Cumulative Redeemable Preferred Units of the Partnership (the "Partnership Preferred Units");

              WHEREAS, the Board of Trustees of the Company (the "Company Board") has declared the Company Merger advisable, and approved this Agreement, the Company Merger and the other transactions contemplated hereby, on substantially the terms and subject to the conditions set forth herein;

              WHEREAS, BRE Glacier LLC, a Delaware limited liability company ("Merger Sub I GP"), as the sole general partner of Merger Sub I, has approved this Agreement and the Company Merger and determined that it is advisable and in the best interests of Merger Sub I and its limited partner for Merger Sub I to enter into this Agreement and to consummate the Company Merger on the terms and subject to the conditions set forth herein;

              WHEREAS, the Company, as the sole general partner of the Partnership, has approved this Agreement and the Partnership Merger and determined that it is advisable and in the best interests of the Partnership and the limited partners of the Partnership for the Partnership to enter into this Agreement and to consummate the Partnership Merger on the terms and subject to the conditions set forth herein;

              WHEREAS, BRE Glacier Acquisition LLC, a Delaware limited liability company ("Merger Sub II GP"), as the sole general partner of Merger Sub II, has approved this Agreement and the Partnership Merger and determined that it is advisable and in the best interests of Merger Sub II and its limited partner for Merger Sub II to enter into this Agreement and to consummate the Partnership Merger on the terms and subject to the conditions set forth herein;

              WHEREAS, the parties hereto intend that, for U.S. federal, and applicable state and local, income tax purposes, the Company Merger shall be treated as a taxable sale by the Company of all of the Company's assets to Merger Sub I in exchange for the Company Share Merger Consideration, the Aggregate Preferred Share Redemption Amount and the assumption of all of the Company's liabilities, followed by a distribution of the Company Share Merger Consideration and the Aggregate Preferred

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Share Redemption Amount to the shareholders of the Company in complete liquidation of the Company pursuant to Section 331 and Section 562 of the Code;

              WHEREAS, the parties hereto intend that this Agreement be, and this Agreement is hereby adopted as, a "plan of liquidation" of the Company for U.S. federal income tax purposes, pursuant to which the distribution (or deemed distribution) of the Company Share Merger Consideration and the Aggregate Preferred Share Redemption Amount to the shareholders of the Company, in complete liquidation of the Company pursuant to Section 331 and Section 562 of the Code, is effected;

              WHEREAS, the Minority Limited Partners may elect to receive in the Partnership Merger, on the terms and conditions specified herein, in exchange for Class A Partnership Units, New Partnership Preferred Units in the Surviving Partnership (each such Minority Limited Partner, a "Roll-Over Limited Partner") in an amount described in Section 2.2(b). In the Partnership Merger, any Class A Partnership Units held by any Minority Limited Partners that do not elect for such Class A Partnership Units to be exchanged for New Partnership Preferred Units will be converted into the right to receive cash per Class A Partnership Unit (each such Minority Limited Partner, a "Cash-Out Limited Partner") in an amount as described in Section 2.2(a);

              WHEREAS, as an inducement to the Company and the Partnership entering into this Agreement, Blackstone Real Estate Partners VIII L.P. (the "Guarantor") is entering into a guaranty with the Company (the "Guaranty"), pursuant to which the Guarantor is guaranteeing certain obligations of Parent and Merger Sub I under this Agreement; and

              WHEREAS, Parent, the Partnership, Merger Sub I, Merger Sub II and the Company desire to make certain representations, warranties, covenants and agreements in connection with the Mergers as set forth herein.

              NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:


ARTICLE I.

THE MERGERS

              Section 1.1      The Mergers.

                            (a)      Subject to the terms and conditions of this Agreement, and in accordance with the DRULPA, at the Partnership Merger Effective Time, Merger Sub II and the Partnership shall consummate the Partnership Merger, pursuant to which (i) Merger Sub II shall be merged with and into the Partnership and the separate existence of Merger Sub II shall thereupon cease and (ii) the Partnership shall be the surviving partnership in the Partnership Merger (the "Surviving Partnership"). The Partnership Merger shall have the effects provided in this Agreement and as specified in the DRULPA.

                            (b)      Subject to the terms and conditions of this Agreement, and in accordance with the DRULPA and the MRL, at the Company Merger Effective Time, the Company and Merger Sub I shall consummate the Company Merger, pursuant to which (i) the Company shall be merged with and into Merger Sub I and the separate existence of the Company shall thereupon cease and (ii) Merger Sub I shall survive the Company Merger (the "Surviving Company"), such that, immediately following the Company Merger, Parent shall be the sole limited partner of the Surviving Company and Merger Sub I GP, a wholly-owned subsidiary of Parent, will be the sole general partner of the Surviving Company. The Company Merger shall have the effects provided in this Agreement and as specified in the DRULPA and the MRL.

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              Section 1.2      Governing Documents.

                            (a)      At the Company Merger Effective Time, the name of the Surviving Company shall be "BRE Glacier L.P." At the Company Merger Effective Time, the certificate of limited partnership of Merger Sub I, as in effect immediately prior to the Company Merger Effective Time, shall be the certificate of limited partnership of the Surviving Company until thereafter amended as provided in the limited partnership agreement of Merger Sub I or by applicable Law. The limited partnership agreement of Merger Sub I, as in effect immediately prior to the Company Merger Effective Time, shall be the limited partnership agreement of the Surviving Company until thereafter amended as provided therein or by applicable Law.

                            (b)      Prior to the Closing Date, the Company, as the general partner of the Partnership, shall cause the Partnership Agreement to be amended to add to such agreement an Exhibit G thereto in the form of Exhibit B hereto (as so amended, the "Amended Partnership Agreement"). At the Partnership Merger Effective Time, the certificate of limited partnership of the Partnership, as in effect immediately prior to the Partnership Merger Effective Time (the "Certificate of Limited Partnership"), shall be the certificate of limited partnership of the Surviving Partnership until thereafter amended as provided below. At the Partnership Merger Effective Time, the Amended Partnership Agreement, as in effect immediately prior to the Partnership Merger Effective Time, shall be the limited partnership agreement of the Surviving Partnership until thereafter amended as provided therein or by applicable Law. On the Closing Date, following the Company Merger Effective Time, the Surviving Company shall file a certificate of amendment to the Certificate of Limited Partnership to reflect the Surviving Company's admission to the Surviving Partnership as the new sole general partner of the Surviving Partnership. From and after the Company Merger Effective Time, the Certificate of Limited Partnership, as so amended, shall be the certificate of limited partnership of the Surviving Partnership until thereafter amended as provided therein or by applicable Law. Promptly following the Company Merger Effective Time, the Surviving Company shall execute and deliver to the Surviving Partnership such documents or instruments as may be required to effect its admission as the successor sole general partner of the Surviving Partnership and as a limited partner of the Surviving Partnership, and it shall thereafter be admitted to the Surviving Partnership as the successor sole general partner and a limited partner of the Surviving Partnership at the Company Merger Effective Time and shall carry on the business of the Surviving Partnership without dissolution as provided in the Partnership Agreement.

              Section 1.3      Officers, General Partner and Limited Partners of the Surviving Entities.

                            (a)      Merger Sub I GP shall be the sole general partner of the Surviving Company following the Company Merger Effective Time, entitling Merger Sub I GP to such rights, duties and obligations as are more fully set forth in the limited partnership agreement of the Surviving Company.

                            (b)      The officers of the Company immediately prior to the Company Merger Effective Time shall be the officers of the Surviving Company from and after the Company Merger Effective Time, until such time as their resignation or removal or such time as their successors shall be duly elected and qualified.

                            (c)      The Company shall be the sole general partner and a limited partner of the Surviving Partnership following the Partnership Merger Effective Time and prior to the Company Merger Effective Time, entitling the Company to such rights, duties and obligations as are more fully set forth in the Amended Partnership Agreement. In the event there are Roll-Over Limited Partners, such Roll-Over Limited Partners shall be additional limited partners of the Surviving Partnership immediately following the Partnership Merger Effective Time. In the event there are no Roll-Over Limited Partners, a direct or indirect wholly-owned Subsidiary of Merger Sub I to be designated by Parent prior to the Partnership

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Merger Effective Time shall be admitted as a limited partner of the Surviving Partnership immediately prior to the Partnership Merger Effective Time.

                            (d)      The Surviving Company shall be the sole general partner of the Surviving Partnership following the Company Merger Effective Time, entitling the Surviving Company to such rights, duties and obligations as are more fully set forth in the Amended Partnership Agreement (as may be further amended to reflect the Surviving Company as the sole general partner of the Surviving Partnership following the Company Merger Effective Time).

              Section 1.4      Effective Times.

                            (a)      On the Closing Date, the Partnership and Merger Sub II shall duly execute and file a certificate of merger (the "Partnership Merger Certificate") with the Secretary of State of the State of Delaware (the "DSOS") in accordance with the Laws of the State of Delaware. The Partnership Merger shall become effective upon the filing of the Partnership Merger Certificate with the DSOS or on such other date and time as may be mutually agreed to by the Company and Parent and specified in the Partnership Merger Certificate in accordance with the DRULPA (the "Partnership Merger Effective Time").

                            (b)      On the Closing Date, Merger Sub I and the Company shall (i) duly execute and file articles of merger (the "Company Merger Articles of Merger") with the State Department of Assessments and Taxation of Maryland (the "SDAT") in accordance with the Laws of the State of Maryland, (ii) duly execute and file a certificate of merger (the "Company Merger Certificate") with the DSOS in accordance with the Laws of the State of Delaware and (iii) make any other filings, recordings or publications required to be made by the Company or Merger Sub I under the MRL and the DRULPA in connection with the Company Merger. The Company Merger shall become effective upon the later of the acceptance for record of the Company Merger Articles of Merger by the SDAT, the filing of the Company Merger Certificate with the DSOS or on such other date and time as may be mutually agreed to by the Company and Parent and specified in the Company Merger Articles of Merger and the Company Merger Certificate in accordance with the MRL and the DRULPA (such date and time being hereinafter referred to as the "Company Merger Effective Time"), it being understood and agreed that the parties shall cause the Company Merger Effective Time to occur immediately after the Partnership Merger Effective Time.

                            (c)      Unless otherwise agreed in writing, the parties shall cause the Company Merger Effective Time and the Partnership Merger Effective Time to occur on the Closing Date, with the Company Merger Effective Time occurring immediately after the Partnership Merger Effective Time.

              Section 1.5      Closing of the Mergers.    The closing of the Mergers (the "Closing") shall take place at a time to be specified by the parties on the third Business Day after satisfaction or waiver of the conditions set forth in Article VI (other than those conditions that by their nature are to be satisfied or waived at the Closing, but subject to the satisfaction or waiver of such conditions), at the offices of Wachtell, Lipton, Rosen & Katz, 51 West 52nd Street, New York, New York 10019, or at such other time, date and place as may be mutually agreed to in writing by the parties hereto (the "Closing Date"); provided, that (i) Parent may on one or more occasions elect to delay the Closing to a date that is on or prior to October 10, 2018 by giving written notice to the Company (an "Extension Notice") at least two Business Days immediately preceding the date that, but for such delivery of such Extension Notice, would have been the Closing Date and (ii) if Parent has delivered an Extension Notice, then Parent may, upon at least five Business Days' prior written notice to the Company, designate the Closing Date to occur on a Business Day occurring on or prior to October 10, 2018 (such date, the "Designated Closing Date") (and, for the avoidance of doubt, Parent shall be entitled to provide one or more additional Extension Notices to delay the Closing to a date following such Designated Closing Date that is on or prior to October 10, 2018, in which event the date specified in such additional Extension Notice(s) shall be the Designated Closing

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Date); provided, further, that if, on the Designated Closing Date, the conditions set forth in Article VI are not satisfied or waived (other than those conditions that by their nature are to be satisfied or waived at the Closing, but subject to the satisfaction or waiver of such conditions), then the Closing shall occur on the third Business Day following the satisfaction or waiver of the conditions set forth in Article VI (other than those conditions that by their nature are to be satisfied or waived at the Closing, but subject to the satisfaction or waiver of such conditions) or on such other date as may be mutually agreed to in writing by the parties hereto. In the event that Parent elects to delay the Closing pursuant to the foregoing, all references to the "Closing Date" in this Agreement shall be deemed to refer to the date on which the Closing occurs.

              Section 1.6      Effects of the Mergers.

                            (a)      The Company Merger shall have the effects set forth in the DRULPA and the MRL. Without limiting the generality of the foregoing, and subject thereto, at the Company Merger Effective Time, all the properties, rights, privileges, powers and franchises of the Company and Merger Sub I shall vest in the Surviving Company, and all debts, liabilities, duties and obligations of the Company and Merger Sub I shall become the debts, liabilities, duties and obligations of the Surviving Company.

                            (b)      The Partnership Merger shall have the effects set forth in the DRULPA. Without limiting the generality of the foregoing, and subject thereto, at the Partnership Merger Effective Time, all the properties, rights, privileges, powers and franchises of the Partnership and Merger Sub II shall vest in the Surviving Partnership, and all debts, liabilities, duties and obligations of the Partnership and Merger Sub II shall become the debts, liabilities, duties and obligations of the Surviving Partnership.

              Section 1.7      Tax Consequences.    The parties intend that for U.S. federal, and applicable state and local, income tax purposes (a) the Company Merger shall be treated as a taxable sale by the Company of all of the Company's assets to Merger Sub I in exchange for the Company Share Merger Consideration, the Aggregate Preferred Share Redemption Amount and the assumption of all of the Company's liabilities, followed by a distribution of the Company Share Merger Consideration and the Aggregate Preferred Share Redemption Amount to the shareholders of the Company in complete liquidation of the Company pursuant to Section 331 and Section 562 of the Code, and that this Agreement be, and is hereby adopted as, a "plan of liquidation" of the Company for U.S. federal income tax purposes, and (b) the Partnership Merger shall be treated as (i) a taxable sale of the Partnership Units by the Cash-Out Limited Partners to Merger Sub I in exchange for the cash portion of the Partnership Unit Merger Consideration and (ii) a contribution of Partnership Units to the Surviving Partnership by the Roll-Over Limited Partners in exchange for New Partnership Preferred Units in a tax deferred transaction under Section 721 of the Code by each Roll-Over Limited Partner. In connection with the Partnership Merger, the capital accounts of the partners of the Partnership will be adjusted to reflect a revaluation of the Partnership property in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f). The parties hereto agree not to take any position on any Tax Return that is inconsistent with the provisions of this Section 1.7 for all U.S. federal, and, if applicable, state and local tax purposes.


ARTICLE II.

MERGER CONSIDERATION; COMPANY SHARES; PARTNERSHIP UNITS

              Section 2.1      Company Share Merger Consideration; Effect on Company Shares.

                            (a)      Partnership Interest of Merger Sub I.    At the Company Merger Effective Time, by virtue of the Company Merger and without any action on the part of any holder thereof, each unit of partnership interest in Merger Sub I issued and outstanding immediately prior to the Company Merger

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Effective Time shall remain as one issued and outstanding unit of partnership interest in the Surviving Company.

                            (b)      Company Share Merger Consideration; Conversion of Company Shares.    At the Company Merger Effective Time, by virtue of the Company Merger and without any action on the part of any holder thereof, each common share, par value $0.01 per share, of the Company (each, a "Company Share") (other than Excluded Shares, if any, and Company Shares under a Company Restricted Share Award) issued and outstanding immediately prior to the Company Merger Effective Time, subject to the terms and conditions set forth herein, shall automatically be converted into the right to receive an amount in cash equal to the sum of (i) Twenty-Seven Dollars and Fifty Cents ($27.50) plus (ii) the Additional Consideration, without interest (such sum, the "Per Company Share Merger Consideration"). The aggregate amount of cash payable to holders of Company Shares as the Per Company Share Merger Consideration is hereinafter referred to as the "Company Share Merger Consideration." The Per Company Share Merger Consideration shall be subject to adjustments as contemplated by Section 2.8 and Section 5.11.

                            (c)      Cancellation of Company Shares Owned by Parent, the Company or Merger Sub I. At the Company Merger Effective Time, each issued and outstanding Company Share that is owned by Parent or Merger Sub I or any Subsidiary of Parent, the Company or Merger Sub I immediately prior to the Company Merger Effective Time (collectively, the "Excluded Shares"), if any, shall automatically be canceled and retired and shall cease to exist, and no cash, Per Company Share Merger Consideration or other consideration shall be delivered or deliverable in exchange therefor.

                            (d)      Cancellation of Company Shares.    As of the Company Merger Effective Time, all Company Shares issued and outstanding immediately prior to the Company Merger Effective Time shall no longer be outstanding and shall automatically be canceled and retired and shall cease to exist, and each holder of a Company Share (other than Excluded Shares, if any) shall cease to have any rights with respect to such interest, except the right to receive the Per Company Share Merger Consideration.

              Section 2.2      Partnership Unit Merger Consideration; Effect on Partnership Units.

                            (a)      Partnership Unit Merger Consideration; Conversion of Class A Partnership Units. At the Partnership Merger Effective Time, by virtue of the Partnership Merger and without any action on the part of any holder thereof, each Class A Partnership Unit, other than Excluded Units, issued and outstanding immediately prior to the Partnership Merger Effective Time, subject to the terms and conditions set forth herein, shall be converted into, and shall be canceled in exchange for, the right to receive an amount in cash equal to the Per Company Share Merger Consideration, without interest (the "Per Partnership Unit Merger Consideration"); provided, that in lieu of receiving the Per Partnership Unit Merger Consideration with respect to Class A Partnership Units held immediately prior to the Partnership Merger Effective Time and subject to a Unit Election, if but only if (x) the applicable Minority Limited Partner has effectively made and not revoked a valid election pursuant to Section 2.2(b) to receive New Partnership Preferred Units in respect thereof and (y) the issuance of such New Partnership Preferred Units would be exempt from registration under the Securities Act and applicable state and foreign securities laws, then each of such holder's Class A Partnership Units subject to a Unit Election shall be converted into one fully paid New Partnership Preferred Unit, without interest. The aggregate amount of cash payable as the Per Partnership Unit Merger Consideration, together with the New Partnership Preferred Units, is hereinafter referred to as the "Partnership Unit Merger Consideration" and, together with the Company Share Merger Consideration and the aggregate Per Company Share Merger Consideration payable in respect of Company Equity Awards pursuant to Section 2.3, the "Merger Consideration."

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                            (b)      Election of New Partnership Preferred Units.    Subject to Section 2.2(b)(iv) and in accordance with Section 2.2(a), each eligible Minority Limited Partner shall be entitled, with respect to all or a portion of the Class A Partnership Units held immediately prior to the Partnership Merger Effective Time by such Minority Limited Partner (and as and to the extent specified by such Minority Limited Partner in the Minority Limited Partner's Form of Election), to make an unconditional election, on or prior to the Election Date, to receive in the Partnership Merger in lieu of the Per Partnership Unit Merger Consideration to which such Minority Limited Partner would otherwise be entitled, New Partnership Preferred Units (a "Unit Election") as follows:

                                            (i)       Parent shall prepare and deliver to the Partnership, as promptly as practicable following the date the Proxy Statement is first mailed to the shareholders of the Company and, in any event, not later than five (5) Business Days after the date on which the Proxy Statement is first mailed to the shareholders of the Company, and the Partnership shall mail to the Minority Limited Partners, a form of election, which form shall be subject to the reasonable approval of the Company (the "Form of Election"). The Form of Election may be used by each eligible Minority Limited Partner to designate such Minority Limited Partner's election to convert any Class A Partnership Units that will be held by such Minority Limited Partner immediately prior to the Partnership Merger Effective Time into New Partnership Preferred Units. Any such Minority Limited Partner's election to receive New Partnership Preferred Units shall be deemed to have been properly made only if Parent shall have received at its principal executive office, not later than 5:00 p.m., New York City time, on the date that is five (5) Business Days before the scheduled date of the Company Shareholders' Meeting (the "Election Date"), a Form of Election specifying that such Minority Limited Partner elects to receive New Partnership Preferred Units with respect to the Class A Partnership Units specified by such Minority Limited Partner in the Minority Limited Partner's Form of Election and otherwise properly completed and signed. The Form of Election shall state therein the date that constitutes the Election Date.

                                            (ii)      A Form of Election may be revoked by any Minority Limited Partner only by written notice received by Parent prior to 5:00 p.m., New York City time, on the Election Date. In addition, all Forms of Election shall be automatically revoked if the Partnership Merger has been abandoned.

                                            (iii)     The reasonable determination of Parent shall be binding as to whether or not elections to receive New Partnership Preferred Units have been properly made or revoked. If Parent determines that any election to receive New Partnership Preferred Units was not properly made, Parent shall notify such Minority Limited Partner of the improper election and provide a reasonable opportunity to such Minority Limited Partner to cure the improper election. If, following such reasonable period, the improperly made election remains uncured, the Class A Partnership Units with respect to which such election was not properly made shall be converted into Per Partnership Unit Merger Consideration in accordance with Section 2.2(a). Parent may, with the agreement of the Company, make such rules as are consistent with this Section 2.2(b) for the implementation of elections provided for herein as shall be necessary or desirable to fully effect such elections.

                                            (iv)     Each eligible Minority Limited Partner, as a condition to making a Unit Election with respect to such Minority Limited Partner's Partnership Units subject to a Unit Election, shall (x) represent to Parent that such holder is (1) an Accredited Investor (as such term is defined under Rule 501 promulgated under the Securities Act) and (2) not a "benefit plan investor" within the meaning of Section 3(42) of ERISA or other plan, account or arrangement (or entity whose assets constitute the assets of a plan, account or arrangement) that is subject to any Laws or regulations that are similar to the fiduciary responsibility or prohibited transaction provisions of Title I of ERISA or Section 4975 of the Code, and (y) agree to be bound by the terms of the Amended Partnership Agreement as it will be in effect immediately following the Partnership Merger Effective Time (which agreement shall incorporate the terms of the New Partnership Preferred Units set forth in Exhibit B hereto and any other terms

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determined by Parent that are not inconsistent with the terms of the New Partnership Preferred Units and do not otherwise materially and adversely affect the holders of New Partnership Preferred Units).

                                            (v)      The Company and the Company Subsidiaries agree to reasonably cooperate with Parent in preparing any disclosure statement or other disclosure information to accompany the Form of Election, including information applicable to an offering of securities exempt from registration under the Securities Act pursuant to Rule 506 thereunder, each of which shall be subject to the reasonable approval of the Company.

                                            (vi)     Promptly after the Partnership Merger Effective Time, the Surviving Partnership shall deliver to each Minority Limited Partner entitled to receive New Partnership Preferred Units pursuant to the terms of Section 2.2(a) and (b), a notice confirming such Minority Limited Partner's record ownership of the New Partnership Preferred Units issuable pursuant hereto in respect of such Minority Limited Partner's Class A Partnership Units subject to a Unit Election.

                                            (vii)    Each Person that receives New Partnership Preferred Units pursuant to the terms of Section 2.2(a) and (b) shall automatically be admitted as a limited partner of the Surviving Partnership at the Partnership Merger Effective Time.

                            (c)      Partnership Units Held by the Company and Roll-Over Limited Partners.    At the Partnership Merger Effective Time, by virtue of the Partnership Merger and without any action on the part of the holder of any partnership interest in the Partnership, (i) each Partnership Unit held by the Company or any wholly owned Subsidiary of the Company immediately prior to the Partnership Merger Effective Time (collectively, the "Continuing Units") shall be unaffected by the Partnership Merger and shall remain outstanding as Partnership Units of the Surviving Partnership held by the Company and/or relevant wholly owned Subsidiaries of the Company and (ii) the Roll-Over Limited Partners shall own the number of New Partnership Preferred Units issued to them in the Partnership Merger.

                            (d)      Cancellation of Parent and Merger Sub II-Owned Partnership Units.    At the Partnership Merger Effective Time, by virtue of the Partnership Merger and without any action on the part of the holder of any partnership interest in the Partnership, each Partnership Unit held by Parent, Merger Sub II or any of their respective wholly owned Subsidiaries immediately prior to the Partnership Merger Effective Time (collectively, the "Cancelled Units" and, together with the Continuing Units, the "Excluded Units") shall automatically be canceled and shall cease to exist, with no consideration to be delivered or deliverable in exchange therefor.

                            (e)      Cancellation of Merger Sub II Interests.    At the Partnership Merger Effective Time, by virtue of the Partnership Merger and without any action on the part of any holder thereof, each partnership interest in Merger Sub II shall automatically be canceled and cease to exist, the holders thereof shall cease to have any rights with respect thereto, and no payment shall be made with respect thereto.

              Section 2.3      Treatment of Equity-Based Awards.

                            (a)      Company Restricted Share Awards.    Effective immediately prior to the Company Merger Effective Time, each award of restricted Company Shares (each, a "Company Restricted Share Award") granted under a Company Equity Plan that is outstanding immediately prior to the Company Merger Effective Time shall be cancelled, with the holder of each such Company Restricted Share Award becoming entitled to receive, in full satisfaction of the rights of such holder with respect thereto, an amount in cash equal to (i) the number of Company Shares subject to the Company Restricted Share Award immediately prior to the Company Merger Effective Time multiplied by (ii) the Per Company Share Merger Consideration, less applicable withholding Taxes.

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                      (b)      Company RSU Awards.    Effective immediately prior to the Company Merger Effective Time, each restricted share unit award covering Company Shares (each, a "Company RSU Award") granted under a Company Equity Plan that is outstanding immediately prior to the Company Merger Effective Time shall be cancelled, with the holder of each such Company RSU Award becoming entitled to receive, in full satisfaction of the rights of such holder with respect thereto, an amount in cash equal to (i) the number of Company Shares subject to the Company RSU Award immediately prior to the Company Merger Effective Time multiplied by (ii) the Per Company Share Merger Consideration, less applicable withholding Taxes.

                      (c)       Company Options.    Effective immediately prior to the Company Merger Effective Time, each option to purchase Company Shares (each, a "Company Option") shall automatically be cancelled, with the holder of such Company Option becoming entitled to receive, in full satisfaction of the rights of such holder with respect thereto, an amount in cash equal to (i) the number of Company Shares subject to the Company Option immediately prior to the Company Merger Effective Time multiplied by (ii) the excess (if any) of the Per Company Share Merger Consideration over the per share exercise price applicable to the Company Option, less applicable withholding taxes.

                      (d)      Company LTIP Units.

                                    (i)        With respect to each LTIP Unit (as defined in the Partnership Agreement, each, a "Company LTIP Unit") that has vested in accordance with its terms prior to the Partnership Merger Effective Time (each, a "Vested LTIP Unit"), prior to the Partnership Merger Effective Time, the Company, as the general partner of the Partnership, shall exercise its right to cause a Forced Conversion (as defined in the Partnership Agreement) with respect to the maximum number of Vested LTIP Units then eligible for conversion, such that as of immediately prior to the Partnership Merger Effective Time, each Vested LTIP Unit shall be converted into one Class A Partnership Unit. For the avoidance of doubt, such Class A Partnership Units issued in respect of such Vested LTIP Units shall be treated as Class A Partnership Units for purposes of this Agreement and the holders of such Class A Partnership Units shall be treated as holders of Class A Partnership Units as described in Section 2.2.

                                    (ii)       With respect to each Company LTIP Unit that is unvested as of the Business Day prior to the Closing Date, (i) the Valuation Date (as defined in the award agreement applicable to such Company LTIP Units) will be deemed to occur on the Business Day immediately prior to the Closing Date, (ii) the Compensation Committee of the Company Board (the "Compensation Committee") shall determine the number of Company LTIP Units that vest as of such Valuation Date in accordance with the provisions of such award agreement that apply in connection with a Change-in-Control (as defined in the award agreement applicable to such Company LTIP Units) and (iii) such Company LTIP Units will vest, without proration, on the Business Day immediately prior to the Closing Date in accordance with the Compensation Committee's determination. For the avoidance of doubt, following such vesting, such Company LTIP Units shall be treated as described in Section 2.3(d)(i). Prior to the Closing Date, the Company shall provide written notice to Parent of the number of Company LTIP Units that vest pursuant to the foregoing, together with a reasonably detailed calculation showing how such number was determined by the Compensation Committee.

                      (e)      As soon as practicable following the date hereof, the Company shall take all actions with respect to the Company ESPP to provide that (i) with respect to any offering periods in effect as of the date hereof (the "Current ESPP Offering Period"), no employee who is not a participant in the Company ESPP as of the date hereof may become a participant in the Company ESPP; (ii) subject to the consummation of the Company Merger, the Company ESPP shall terminate immediately prior to the Company Merger Effective Time, (iii) if the Current ESPP Offering Period terminates prior to the Company Merger Effective Time, then the Company ESPP shall be suspended and no new offering period shall be commenced under the Company ESPP prior to the termination of this Agreement, and (iv) if the

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Current ESPP Offering Period is still in effect at the Company Merger Effective Time, then the last day of such Current ESPP Offering Period shall be accelerated to a date before the Closing Date as specified by the Company Board or its designated committee in accordance with Section 18(b) of the Company ESPP.

                      (f)       Cash amounts payable to employees pursuant to Section 2.3(a), Section 2.3(b) and Section 2.3(c) shall be paid through the Company's payroll, less applicable withholding taxes, within ten (10) Business Days following the Closing Date. Notwithstanding anything to the contrary in this Section 2.3, any payment in respect of a Company RSU Award that, immediately prior to the Company Merger Effective Time, was subject to Section 409A of the Code, shall be made at such time is required to comply with Section 409A of the Code.

                      (g)      Prior to the Partnership Merger Effective Time, the Company shall take all actions necessary for the treatment of Company Equity Awards contemplated by this Section 2.3 and to ensure that, following the transactions contemplated by this Agreement, no Company Equity Awards shall exist (and no holder of any rights in respect thereof shall have any further rights other than as expressly contemplated by this Section 2.3).

       Section 2.4      Exchange of Certificates.

                      (a)      Paying Agent.    Prior to the Partnership Merger Effective Time, Parent shall appoint a bank or trust company reasonably satisfactory to the Company to act as Paying Agent (the "Paying Agent") for (i) the payment or exchange in accordance with this Article II of the Merger Consideration (other than any New Partnership Preferred Units to be issued in accordance with this Article II pursuant to the Unit Election and payments in respect of Company Equity Awards) and (ii) if Parent directs the Paying Agent to so act (provided, however, that if Parent does not direct the Paying Agent to so act, Parent shall so act), in Parent's discretion, the exchange of Class A Partnership Units subject to a Unit Election for New Partnership Preferred Units pursuant to and in accordance with Section 2.2. At or prior to the Partnership Merger Effective Time, Parent shall deposit or cause to be deposited with the Paying Agent the cash portion of the Merger Consideration for the benefit of the holders of Company Shares and Class A Partnership Units, as applicable, and, if applicable, immediately following the Partnership Merger Effective Time, the New Partnership Preferred Units to be issued pursuant to and in accordance with Section 2.2, less the Per Company Share Merger Consideration to be paid in respect of Company Equity Awards (for the avoidance of doubt, the cash portion of the Merger Consideration payable in respect of Class A Partnership Units issued upon conversion of LTIP Units shall be deposited with the Paying Agent) which amount shall be paid directly to the Surviving Company (the cash portion of the Merger Consideration and, if applicable, any such New Partnership Preferred Units so deposited being referred to herein as the "Exchange Fund"). The Paying Agent shall make payments of the Company Share Merger Consideration and the Partnership Unit Merger Consideration out of the Exchange Fund in accordance with this Agreement, and the Exchange Fund shall not be used for any other purpose. Any and all interest earned on cash deposited in the Exchange Fund shall be paid to the Surviving Company.

                      (b)      Share and Unit Transfer Books.    On the Closing Date, the share transfer books of the Company and the unit transfer books of the Partnership shall be closed and thereafter there shall be no further registration of transfers of the Company Shares or Partnership Units (except for the transfer of Partnership Units owned by the Company in the Company Merger). From and after the Closing Date, the holders of any certificates (each such certificate, a "Certificate") representing ownership of the Company Shares or Partnership Units outstanding immediately prior to the Company Merger Effective Time or the Partnership Merger Effective Time, as applicable, or any book-entry shares (each such book-entry share, a "Book-Entry Share") or book-entry units (each such book-entry unit, a "Book-Entry Unit") representing Company Shares or Partnership Units outstanding immediately prior to the Company Merger Effective Time or the Partnership Merger Effective Time, as applicable, shall cease to have rights with respect to such shares or units, as applicable, except as otherwise provided for herein. On or after the Closing Date,

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any Certificates, Book-Entry Shares or Book-Entry Units presented to the Paying Agent, the Surviving Company or the Surviving Partnership in accordance with this Agreement shall be exchanged for the Per Company Share Merger Consideration, the Per Partnership Unit Merger Consideration or New Partnership Preferred Units, as applicable, with respect to the Company Shares or Partnership Units formerly represented thereby.

       Section 2.5      Exchange Procedures.

                      (a)      Procedure.    As soon as practicable after the Closing Date (but in any event within five (5) Business Days), the Surviving Company shall (i) cause the Paying Agent to mail to each holder of record of a Certificate or Certificates that, immediately prior to the Company Merger Effective Time, represented outstanding Company Shares or that, immediately prior to the Partnership Merger Effective Time, represented Partnership Units, which were converted into the right to receive or be exchanged for the Per Company Share Merger Consideration, the Per Partnership Unit Merger Consideration or New Partnership Preferred Units, as applicable, pursuant to Section 2.1 and Section 2.2: (x) a letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the Certificates shall pass to the Paying Agent, only upon delivery of the Certificates or affidavits of loss in lieu thereof in accordance with Section 2.5(f) to the Paying Agent, and which letter shall be in such form and have such other provisions as Parent and the Company may mutually agree and specify) and (y) instructions for use in effecting the surrender of the Certificates in exchange for the Per Company Share Merger Consideration, Per Partnership Unit Merger Consideration or New Partnership Preferred Units, as applicable, to which the holder thereof is entitled, and (ii) pay (or deliver, as applicable) the Per Partnership Unit Merger Consideration and any New Partnership Preferred Units to be paid or issued to holders of Class A Partnership Units, less any applicable income and employment withholding Taxes. Upon surrender of a Certificate for cancellation or affidavits of loss in lieu thereof in accordance with Section 2.5(f) to the Paying Agent or to such other agent or agents reasonably satisfactory to the Company as may be appointed by Parent, together with such letter of transmittal, duly executed and completed in accordance with the instructions thereto, and such other documents as may reasonably be required by the Paying Agent, the holder of such Certificate shall be entitled to receive in exchange therefor the Per Company Share Merger Consideration, the Per Partnership Unit Merger Consideration or New Partnership Preferred Units, as applicable, payable or issuable in respect of the Company Shares or Partnership Units, as applicable, previously represented by such Certificate pursuant to the provisions of this Article II, and the Certificate so surrendered shall forthwith be canceled. In the event of a transfer of ownership of Company Shares or Partnership Units to a Person that is not registered in the transfer records of the Company or Partnership, payment may be made to a Person other than the Person in whose name the Certificate so surrendered is registered, if such Certificate shall be properly endorsed or otherwise be in proper form for transfer and the Person requesting such payment shall pay any transfer or other similar Taxes required by reason of the payment to a Person other than the registered holder of such Certificate or establish to the reasonable satisfaction of Parent that such Tax has been paid or is not applicable. Notwithstanding anything to the contrary contained in this Agreement, no holder of Book-Entry Shares or Book-Entry Units shall be required to deliver a Certificate or letter of transmittal or surrender such Book-Entry Shares or Book-Entry Units to the Paying Agent. In lieu thereof, the holder of such Book-Entry Shares or Book-Entry Units shall automatically upon the Company Merger Effective Time or the Partnership Merger Effective Time, as applicable, be entitled to receive in exchange therefor the Per Company Share Merger Consideration, the Per Partnership Unit Merger Consideration or New Partnership Preferred Units, as applicable, payable in respect of the Company Shares or Partnership Units, as applicable, previously represented by such Book-Entry Shares or Book-Entry Units pursuant to the provisions of this Article II. Until surrendered, in the case of a Certificate, or paid, in the case of a Book-Entry Share or Book-Entry Unit, in each case, as contemplated by this Section 2.5, each Certificate, Book-Entry Share or Book-Entry Unit shall be deemed at any time after the Closing Date to represent only the right to receive, upon such surrender, the Per Company Share Merger Consideration, the Per

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Partnership Unit Merger Consideration or New Partnership Preferred Units, as applicable, as contemplated by this Article II. No interest shall be paid or accrue for the benefit of the holders of the Certificates, Book-Entry Shares or Book-Entry Units on any cash payable hereunder.

                      (b)      No Further Ownership Rights in the Company Shares or Partnership Units.    On the Closing Date, holders of Company Shares or Partnership Units that are converted into the right to receive Per Company Share Merger Consideration, Per Partnership Unit Merger Consideration or New Partnership Preferred Units, as applicable, shall cease to be, and shall have no rights as, shareholders of the Company or limited partners of the Partnership other than the right to receive the Per Company Share Merger Consideration, Per Partnership Unit Merger Consideration or New Partnership Preferred Units, as applicable, as provided under this Article II. The Per Company Share Merger Consideration, the Per Partnership Unit Merger Consideration or the New Partnership Preferred Units, as applicable, paid, delivered or issued upon the surrender for exchange of Certificates representing Company Shares or Partnership Units, or automatically in the case of Book-Entry Shares or Book-Entry Units, in accordance with the terms of this Article II shall be deemed to have been paid, delivered or issued, as the case may be, in full satisfaction of all rights and privileges pertaining to the Company Shares or Partnership Units, as applicable, exchanged therefor.

                      (c)       Termination of Exchange Fund.    Any portion of the Exchange Fund that remains undistributed to the holders of the Certificates, Book-Entry Shares or Book-Entry Units for twelve (12) months after the Closing Date shall be delivered to the Surviving Company and any holders of Company Shares or Partnership Units prior to the Company Merger Effective Time or Partnership Merger Effective Time, as applicable, who have not theretofore complied with this Article II shall thereafter look only to the Surviving Company and only as general creditors thereof for payment of the Per Company Share Merger Consideration, the Per Partnership Unit Merger Consideration or the New Partnership Preferred Units, as applicable, upon compliance with the procedures set forth in Section 2.5(a) and subject to Section 2.5(d).

                      (d)      No Liability.    None of Parent, Merger Sub I, the Surviving Company, the Partnership, Merger Sub II, the Surviving Partnership, the Company or the Paying Agent, or any employee, officer, trustee, director, agent or affiliate thereof, shall be liable to any Person in respect of Merger Consideration from the Exchange Fund delivered to a public official pursuant to any applicable abandoned property, escheat or similar Law. Any amounts remaining unclaimed by holders of the Certificates, Book-Entry Shares or Book-Entry Units immediately prior to the time at which such amounts would otherwise escheat to, or become the property of, any Governmental Entity shall, to the extent permitted by applicable Law, become the property of the Surviving Company, free and clear of any claims or interest of any such holders or their successors, assigns or personal representatives previously entitled thereto.

                      (e)      Investment of Exchange Fund.    After the Closing Date, the Paying Agent shall invest any cash included in the Exchange Fund as directed by the Surviving Company. Any interest and other income resulting from such investments shall be paid to the Surviving Company. Until the termination of the Exchange Fund pursuant to Section 2.5(c), to the extent that there are losses with respect to such investments, or the cash portion of the Exchange Fund diminishes for other reasons below the level required to make prompt payments of the Company Share Merger Consideration or the cash portion of the Partnership Unit Merger Consideration as contemplated hereby, the Surviving Company shall promptly replace or restore the cash portion of the Exchange Fund lost through investments or other events so as to ensure that the cash portion of the Exchange Fund is, at all times, maintained at a level sufficient to make all such payments.

                      (f)       Lost Certificates.    If any Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the Person claiming such Certificate to be lost, stolen or destroyed to the reasonable satisfaction of Parent and the Paying Agent and the taking of such other actions as may be

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reasonably requested by the Paying Agent, the Paying Agent (or, if subsequent to the termination of the Exchange Fund pursuant to, and subject to, Section 2.5(c), the Surviving Company) will issue, in exchange for such lost, stolen or destroyed Certificate, the Per Company Share Merger Consideration, the Per Partnership Unit Merger Consideration or the New Partnership Preferred Units, as applicable, payable in respect thereof, in accordance with this Agreement.

       Section 2.6      Withholding Rights.    Each of the Company, the Surviving Company, the Surviving Partnership, Parent, Merger Sub I, Merger Sub II and the Paying Agent, as applicable, shall be entitled to deduct and withhold from any amounts otherwise payable pursuant to this Agreement such amounts as it is required to deduct and withhold with respect to the making of such payment (and, with respect to Company Equity Awards, the vesting, cancellation or redemption of such Company Equity Awards, as applicable) under the Code, and the rules and regulations promulgated thereunder, or any applicable provision of state, local or foreign Tax Law. Any amounts so deducted and withheld by the Company, the Surviving Company, the Surviving Partnership, Parent, Merger Sub I, Merger Sub II and the Paying Agent shall be promptly paid over by such Person to the appropriate Governmental Entity in accordance with applicable Law. To the extent that amounts are so deducted and withheld and so paid over to the appropriate Governmental Entity, such deducted and withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Person in respect of which such deduction and withholding was made. The Surviving Company shall pay or cause to be paid the income and employment withholding Taxes required to be paid in connection with the cancellation of Company Equity Awards pursuant to Section 2.3 to the appropriate Governmental Entity on behalf of the holders of Company Equity Awards within the time period required by applicable Law.

       Section 2.7      Dissenters' Rights.    No dissenters' or appraisal rights shall be available with respect to the Mergers.

       Section 2.8      Adjustment of Per Company Share Merger Consideration, Per Partnership Unit Merger Consideration or New Partnership Preferred Units.    In the event that, subsequent to the date of this Agreement but prior to the Company Merger Effective Time or the Partnership Merger Effective Time, as applicable, the Company Shares or the Partnership Units issued and outstanding shall, through a reorganization, recapitalization, reclassification, share dividend, share split, reverse share split or other similar change in the capitalization of the Company or the Partnership, as applicable, increase or decrease in number or be changed into or exchanged for a different kind or number of securities, then an appropriate and proportionate adjustment shall be made to the Per Company Share Merger Consideration, the Per Partnership Unit Merger Consideration and New Partnership Preferred Units, as applicable, to provide the holders the same economic effect as contemplated by this Agreement prior to such event; provided, however, that nothing set forth in this Section 2.8 shall be construed to supersede or in any way limit the prohibitions set forth in Section 5.1 hereof.


ARTICLE III.

REPRESENTATIONS AND WARRANTIES OF THE COMPANY PARTIES

       Except (a) as disclosed in the Company SEC Documents furnished or filed prior to the date hereof (other than disclosures in the "Risk Factors" sections of any such filings and any disclosure of risks or other matters included in any "forward-looking statements" disclaimer or other statements that are cautionary, predictive or forward-looking in nature), or (b) as disclosed in the separate disclosure letter which has been delivered by the Company to Parent in connection with the execution and delivery of this Agreement, including the documents attached to or incorporated by reference in such disclosure letter (the "Company Disclosure Letter") (it being agreed that disclosure of any item in any section or subsection of the Company Disclosure Letter shall also be deemed to be disclosed with respect to any other section or subsection in this Agreement to which the relevance of such item is reasonably apparent

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on the face of such disclosure), the Company and the Partnership hereby jointly and severally represent and warrant to Parent, Merger Sub I and Merger Sub II as follows:

       Section 3.1      Organization and Qualification; Subsidiaries.

                     (a)      The Company is a real estate investment trust duly formed, validly existing and in good standing under the Laws of the State of Maryland. The Partnership is a limited partnership duly formed, validly existing and in good standing under the Laws of the State of Delaware. Each other Company Subsidiary is a corporation or other legal entity duly incorporated or organized, validly existing and in good standing (with respect to jurisdictions that recognize such concept), as applicable, under the Laws of the jurisdiction of its incorporation or organization, except where the failure to be so existing and in good standing would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect. The Company and each Company Subsidiary has requisite real estate investment trust or other legal entity, as the case may be, power and authority to own, lease and operate its properties and assets and to carry on its business as it is now being conducted, except where the failure to have such power and authority would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect. The Company and each Company Subsidiary is duly qualified to do business and is in good standing in each jurisdiction (with respect to jurisdictions that recognize such concept) where the ownership, leasing or operation of its properties or assets or the conduct of its business requires such qualification, except where the failure to be so qualified or in good standing would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.

                     (b)      The Company has made available to Parent true and complete copies of (i) the declaration of trust of the Company (the "Company Charter"), (ii) the Amended and Restated Bylaws of the Company (the "Company Bylaws"), (iii) the Partnership Agreement and (iv) the Certificate of Limited Partnership, in each case as in effect as of the date hereof and together with all amendments thereto. Each of the Company Charter, the Company Bylaws, the Partnership Agreement and the Certificate of Limited Partnership was duly adopted and is in full force and effect, and neither the Company nor the Partnership is in violation of any of the provisions of such documents.

                     (c)      Section 3.1(c) of the Company Disclosure Letter sets forth a complete list of each Company Subsidiary, together with its jurisdiction of organization or incorporation and the ownership interest (and percentage interest) of the Company or a Company Subsidiary and any other Person, as applicable, in such Company Subsidiary.

                     (d)      Section 3.1(d) of the Company Disclosure Letter sets forth a complete list of Persons, other than the Company Subsidiaries, in which the Company or any Company Subsidiary has an equity interest as of the date of this Agreement recorded on the Company's most recent balance sheet in an amount in excess of $2,000,000 (a "JV Entity"), together with the Company's or applicable Company Subsidiary's ownership interests and stated percentage interests in each such entity.

       Section 3.2      Capitalization.

                     (a)      The authorized share capital of the Company consists of 490,000,000 Company Shares, and 10,000,000 preferred shares, $0.01 par value per share, of the Company (the "Company Preferred Shares"), of which 3,500,000 shares are classified as Company Series A Preferred Shares (the "Company Series A Preferred Shares"). As of May 4, 2018, (i) 160,785,498 Company Shares were issued and outstanding, all of which were duly authorized, validly issued, fully paid and nonassessable, and free of preemptive rights (such number includes 365,721 Company Shares that are unvested outstanding Company Restricted Share Awards), and 3,500,000 Company Series A Preferred Shares were issued and outstanding, all of which were duly authorized, validly issued, fully paid and nonassessable, and free of preemptive rights, (ii) no Company Shares or Company Preferred Shares were reserved for issuance except for an

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aggregate of 16,351,564 Company Shares reserved and available for future issuance under the Company Equity Plans, the Company ESPP, the Company's dividend reinvestment plan and the Company's "at-the-market" program, (iii) 67,984 Company Shares were underlying outstanding Company RSU Awards and (iv) 68,313 Company Shares were underlying Company Options.

                     (b)      All Company Shares to be issued pursuant to any Company Equity Award shall be, when issued, duly authorized, validly issued, fully paid and nonassessable, and free of preemptive rights. Section 3.2(b) of the Company Disclosure Letter sets forth the following information with respect to each Company Restricted Share Award, Company RSU Award, Company Option and Company LTIP Unit outstanding as of May 4, 2018: (i) the name of the holder of such Company Restricted Share Award, Company RSU Award, Company Option or Company LTIP Unit; (ii) the number of Company Shares subject to such Company RSU Award, or Company Option and the number of Company LTIP Units held by such holder; (iii) the date on which such Company Restricted Share Award, Company RSU Award, Company Option or Company LTIP Unit was granted; (iv) the extent to which such Company Restricted Share Award, Company RSU Award, Company Option or Company LTIP Unit is vested and/or non-forfeitable, as of May 4, 2018, and the times and extent to which such Company Restricted Share Award, or Company RSU Award (assuming target level and maximum performance to the extent applicable) or Company Option or Company LTIP Unit is scheduled to become vested and/or non-forfeitable thereafter; and (v) the exercise price per Company Share of such Company Option.

                     (c)      As of the date hereof, except as provided in Section 3.2(a) or (b) and except as set forth in Section 3.2(c) of the Company Disclosure Letter, there are no (i) outstanding securities of the Company or any Company Subsidiary convertible into or exchangeable for one or more shares of the share capital of, or other equity or voting interests in, the Company or any Company Subsidiary, (ii) options, warrants or other rights or securities issued or granted by the Company or any Company Subsidiary relating to or based on the value of the equity securities of the Company or any Company Subsidiary, (iii) Contracts that are binding on the Company or any Company Subsidiary that obligate the Company or any Company Subsidiary to issue, acquire, sell, redeem, exchange or convert any capital shares of, or other equity interests in, the Company or any Company Subsidiary, or (iv) outstanding restricted shares, restricted share units, share appreciation rights, performance shares, performance units, deferred share units, contingent value rights, "phantom" shares or similar rights issued or granted by the Company or any Company Subsidiary that are linked to the value of the Company Shares. Since the close of business on May 4, 2018 through the date hereof, the Company has not issued any Company Shares or other equity security (other than shares in respect of Company Equity Awards outstanding prior to such date). The Company does not have a shareholder rights plan in place. Except as set forth in Section 3.2(c) of the Company Disclosure Letter, the Company has not exempted any Person from the "Common Share Ownership Limit" or the "Preferred Share Ownership Limit" or established or increased an "Excepted Holder Limit," as such terms are defined in the Company Charter, which exemption or "Excepted Holder Limit" remains in effect. There are no outstanding bonds, debentures, notes or other Indebtedness of the Company or any of the Company Subsidiaries having the right to vote on any matters on which holders of capital stock or other equity interests of the Company or any of the Company Subsidiaries may vote. None of the Company Subsidiaries owns any Company Shares.

                     (d)      Except as provided in Section 3.2(f) and except as set forth in Section 3.2(d) of the Company Disclosure Letter, the Company or another Company Subsidiary owns, directly or indirectly, all of the issued and outstanding shares of share capital or other equity securities of each of the Company Subsidiaries, free and clear of any Liens other than transfer and other restrictions under applicable federal and state securities Laws and restrictions in the organizational documents of the Company or any Company Subsidiary, and all of such outstanding shares or other equity securities have been duly authorized and validly issued and are fully paid, nonassessable (as applicable) and free of preemptive rights. Except (i) pursuant to the Company Charter, (ii) pursuant to the Partnership Agreement, (iii) for

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equity securities and other instruments (including loans) in wholly owned Company Subsidiaries and (iv) as set forth in Section 3.2(d) of the Company Disclosure Letter, neither the Company nor any Company Subsidiary has any obligation to acquire any equity interest in another Person, or to make any investment (in each case, in the form of a loan, capital contribution or similar transaction) in, any other Person (including any Company Subsidiary).

                     (e)      Except as set forth in Section 3.2(e) of the Company Disclosure Letter and for transfer restrictions in the organizational documents of the Company or any Company Subsidiary, neither the Company nor any of the Company Subsidiaries is a party to any Contract with respect to the voting of, that restricts the transfer of or that provides registration rights in respect of, any capital shares or other voting securities or equity interests of the Company or any of the Company Subsidiaries.

                     (f)       The Company is the sole general partner of the Partnership. As of the date hereof, the Company holds 160,785,498 Class A Partnership Units and 3,500,000 Partnership Preferred Units. In addition to the Partnership Units held by the Company, as of the date hereof, (i) 5,300,343 issued and outstanding Class A Partnership Units were held by Persons other than the Company, (ii) 659,515 issued and outstanding Company LTIP Units were ear