Exhibit 10.1
$125,000,000 AGGREGATE PRINCIPAL AMOUNT
FIRST POTOMAC REALTY INVESTMENT LIMITED PARTNERSHIP
4.0% EXCHANGEABLE SENIOR NOTES DUE 2011
Registration Rights Agreement
dated December 11, 2006

 

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     REGISTRATION RIGHTS AGREEMENT, dated as of December 11, 2006, among First
Potomac Realty Investment Limited Partnership, a Delaware limited partnership
(the “Operating Partnership”), First Potomac Realty Trust, a Maryland real
estate investment trust (the “Company”), Wachovia Capital Markets, LLC as
representative (the “Representative”) of the several initial purchasers (the
“Initial Purchasers”) under the Purchase Agreement (as defined below).
     Pursuant to the Purchase Agreement, dated as of December 11, 2006, among
the Operating Partnership, the Company, the Representative and the Initial
Purchasers (the “Purchase Agreement”), relating to the initial placement (the
“Initial Placement”) of the Notes (as defined below), the Initial Purchasers
have agreed to purchase from the Operating Partnership $125,000,000 (including
$15,000,000 pursuant to the Initial Purchasers’ exercise in full of their
over-allotment option) in aggregate principal amount of 4.0% Exchangeable Senior
Notes due 2011 (the “Notes”). The Notes will be exchangeable, subject to the
terms thereof, into fully paid, nonassessable common shares of beneficial
interest, par value $0.001 per share, of the Company (the “Common Shares”). The
Notes will be fully and unconditionally guaranteed as to the payment of
principal and interest by the Company. The Company has agreed to provide the
registration rights set forth in this Agreement whereby the Company agrees with
you for your benefit and the benefit of the holders from time to time of the
Notes (including the Initial Purchasers) (each a “Holder” and, collectively, the
“Holders”), as follows:
     1. Definitions. Capitalized terms used herein without definition shall have
their respective meanings set forth in the Purchase Agreement. As used in this
Agreement, the following capitalized defined terms shall have the following
meanings:
     “Act” shall mean the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder.
     “Additional Interest” shall have the meaning set forth in Section 7 hereof.
     “Affiliate” shall have the meaning specified in Rule 405 under the Act and
the terms “controlling” and “controlled” shall have meanings correlative
thereto.
     “Automatic Shelf Registration Statement” shall mean a Registration
Statement filed by a Well-Known Seasoned Issuer which shall become effective
upon filing thereof pursuant to General Instruction I.D for Form S-3.
     “Broker-Dealer” shall mean any broker or dealer registered as such under
the Exchange Act.
     “Business Day” shall mean any day other than a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust companies are
authorized or obligated by law to close in New York City.
     “Closing Date” shall mean the date of the first issuance of the Notes.
     “Commission” shall mean the Securities and Exchange Commission.

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     “Note” shall have the meaning set forth in the preamble.
     “Deferral Period” shall have the meaning indicated in Section 3(i) hereof.
     “DTC” shall mean The Depository Trust Company, New York, New York.
     “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the Commission promulgated thereunder.
     “Exchange Price” shall have the meaning specified in the Indenture.
     “Final Memorandum” shall mean the offering memorandum, dated December 5,
2006, relating to the offering of the Notes, including any and all annexes
thereto and any information incorporated by reference therein as of such date.
     “Free Writing Prospectus” shall mean a free writing prospectus, as defined
in Rule 405 under the Act.
     “Holder” shall have the meaning set forth in the preamble hereto.
     “Indenture” shall mean the Indenture relating to the Notes, dated as of
December 11, 2006, by and among the Operating Partnership, the Company, as
guarantor, and Wells Fargo Bank, National Association, as trustee, as the same
may be amended from time to time in accordance with the terms thereof.
     “Initial Placement” shall have the meaning set forth in the preamble
hereto.
     “Initial Purchasers” shall have the meaning set forth in the preamble
hereto.
     “Issuer Free Writing Prospectus” shall mean an issuer free writing
prospectus, as defined in Rule 433 under the Act.
     “Losses” shall have the meaning set forth in Section 5(d) hereof.
     “Majority Holders” shall mean, on any date, Holders of a majority of the
Common Shares registered under the Shelf Registration Statement.
     “Managing Underwriters” shall mean the investment banker or investment
bankers and manager or managers that administer an underwritten offering, if
any, conducted pursuant to Section 6 hereof.
     “NASD Rules” shall mean the Conduct Rules and the By-Laws of the National
Association of Securities Dealers, Inc.
     “Notice and Questionnaire” shall mean a written notice delivered to the
Company substantially in the form attached as Annex A to the Final Memorandum.

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     “Notice Holder” shall mean any Holder of Registrable Securities that has
delivered a Notice and Questionnaire to the Company on or prior to the tenth day
before the effectiveness of the Shelf Registration Statement.
     “Prospectus” shall mean a prospectus included in the Shelf Registration
Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A or Rule 430B under the Act),
as amended or supplemented by any prospectus supplement, with respect to the
terms of the offering of any portion of the Common Shares covered by the Shelf
Registration Statement, and all amendments and supplements thereto, including
any and all exhibits thereto and any information incorporated by reference
therein.
     “Purchase Agreement” shall have the meaning set forth in the preamble
hereto.
     “Registrable Securities” shall mean Common Shares initially issuable in
exchange for the Notes initially sold to the Initial Purchasers pursuant to the
Purchase Agreement other than those that have (i) been registered under the
Shelf Registration Statement and disposed of in accordance therewith, (ii) have
become eligible to be sold without restriction as contemplated by Rule 144(k)
under the Act or any successor rule or regulation thereto that may be adopted by
the Commission or (iii) ceased to be outstanding.
     “Registration Expenses” shall mean any and all expenses incident to
performance of or compliance by the Company and the Operating Partnership with
this Agreement, including without limitation: (i) all Commission or National
Association of Securities Dealers, Inc. (the “NASD”) registration and filing
fees, including, if applicable, the fees and expenses of any “qualified
independent underwriter” (and its counsel) that is required to be retained by
any Holder of Registrable Securities in accordance with the rules and
regulations of the NASD, (ii) all fees and expenses incurred in connection with
compliance with state securities or blue sky laws (including reasonable fees and
disbursements of one counsel for all underwriters or Holders as a group in
connection with blue sky qualification of any of the Registrable Securities) and
compliance with the rules of the NASD, (iii) all expenses of any Persons in
preparing or assisting in preparing, word processing, printing and distributing
any Shelf Registration Statement, any Prospectus and any amendments or
supplements thereto, and in preparing or assisting in preparing, printing and
distributing any underwriting agreements, securities sales agreements and other
documents relating to the performance of and compliance with this Agreement,
(iv) the fees and disbursements of counsel for the Company and the Operating
Partnership and of the independent certified public accountants of the Company
and the Operating Partnership.
     “Shelf Registration Period” shall have the meaning set forth in Section
2(c) hereof.
     “Shelf Registration Statement” shall mean a “shelf’ registration statement
of the Company pursuant to the provisions of Section 2 hereof which covers some
or all of the Common Shares on an appropriate form under Rule 415 under the Act,
or any similar rule that may be adopted by the Commission, amendments and
supplements to such registration

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statement, including post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all material incorporated
by reference therein.
     “Underwriter” shall mean any underwriter of Common Shares in connection
with an offering thereof under the Shelf Registration Statement.
     “Well-Known Seasoned Issuer” or “WKSI” shall have the meaning set forth in
Rule 405 under the Act.
     2. Shelf Registration. (a) The Company shall as promptly as practicable
(but in no event later than May 1, 2007) file with the Commission a Shelf
Registration Statement (which shall be an Automatic Shelf Registration Statement
if the Company is a WKSI on the date of such filing) providing for the
registration of, and the sale on a continuous or delayed basis by the Holders
of, all of the Registrable Securities, from time to time in accordance with the
methods of distribution elected by such Holders, pursuant to Rule 415 under the
Act or any similar rule that may be adopted by the Commission.
     (b) If the Shelf Registration Statement is not an Automatic Shelf
Registration Statement, the Company shall use its reasonable efforts to cause
the Shelf Registration Statement to become or be declared effective under the
Act as promptly as practicable but no later than 210 days after the Closing
Date.
     (c) The Company shall use its reasonable efforts to keep the Shelf
Registration Statement continuously effective, supplemented and amended as
required by the Act, in order to permit the Prospectus forming part thereof to
be usable by Holders for a period (the “Shelf Registration Period”) from the
date the Shelf Registration Statement is declared effective by the Commission
(or becomes effective in the case of an Automatic Shelf Registration Statement)
until the earlier of (i) two years after the 23rd trading day immediately
following the maturity date of the Notes or (ii) the date upon which there are
no Notes or Registrable Securities outstanding. The Company shall be deemed not
to have used its reasonable efforts to keep the Shelf Registration Statement
effective during the Shelf Registration Period if it voluntarily takes any
action that would result in Holders of Registrable Securities not being able to
offer and sell such Common Shares at any time during the Shelf Registration
Period, unless such action is (x) required by applicable law or otherwise
undertaken by the Company in good faith and for valid business reasons (not
including avoidance of the Company’s obligations hereunder), including the
acquisition or divestiture of assets, and (y) permitted by Section 3(i) hereof.
None of the Company, the Operating Partnership or any of their respective
securityholders (other than Holders of Registrable Securities) shall have the
right to include any securities of the Company or the Operating Partnership in
any Shelf Registration Statement other than Registrable Securities.
     (d) The Company shall cause the Shelf Registration Statement and the
related Prospectus and any amendment or supplement thereto, as of the effective
date of the Shelf Registration Statement or such amendment or supplement, (i) to
comply in all material respects with the applicable requirements of the Act; and
(ii) not to contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to

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make the statements therein (in the case of the Prospectus, in the light of the
circumstances under which they were made) not misleading.
     (e) The Company shall issue a press release through Dow Jones & Company,
Inc. and Bloomberg Business News announcing the anticipated filing date and
effective date of the Shelf Registration Statement as promptly as practicable
prior to the anticipated effective date thereof. Each Holder of Registrable
Securities agrees to deliver to the Company a Notice and Questionnaire and such
other information as the Company may reasonably request in writing on or prior
to the 10th Business Day before the effective date of the Shelf Registration
Statement. From and after the effective date of the Shelf Registration
Statement, the Company shall use reasonable efforts after the date a Notice and
Questionnaire is delivered to the Company by a Holder within 20 Business Days
after such date, (i) (A) if required by applicable law, to file with the
Commission a post-effective amendment or prospectus supplement to the Shelf;
provided however that the Company shall not be required to file more than one
post-effective amendment or prospectus supplement in any 90-day period in
accordance with this Section 2(e)(i) or (B) to prepare and, if permitted or
required by applicable law, to file a supplement to the related Prospectus or an
amendment or supplement to any document incorporated therein by reference or
file any other required document so that the Holder delivering such Notice and
Questionnaire is named as a selling securityholder in the Shelf Registration
Statement and the related Prospectus, and so that such Holder is permitted to
deliver such Prospectus to purchasers of the Registrable Securities in
accordance with applicable law and, if the Company shall file a post-effective
amendment to the Shelf Registration Statement, use reasonable efforts to cause
such post-effective amendment to be declared effective under the Act as promptly
as is practicable; (ii) provide such Holder, upon request, copies of any
documents filed pursuant to Section 2(e)(i hereof; and (iii) notify such Holder
as promptly as practicable after the effectiveness under the Act of any
post-effective amendment filed pursuant to Section 2(e)(i) hereof; provided,
that if such Notice and Questionnaire is delivered during a Deferral Period, the
Company shall so inform the Holder delivering such Notice and Questionnaire and
shall take the actions set forth in clauses (i), (ii) and (iii) above upon
expiration of the Deferral Period in accordance with Section 3(i) hereof.
Notwithstanding anything contained herein to the contrary, the Company shall be
under no obligation to name any Holder that is not a Notice Holder as a selling
securityholder in the Shelf Registration Statement or related Prospectus;
provided, however, that any Holder that becomes a Notice Holder pursuant to the
provisions of this Section 2(e) (whether or not such Holder was a Notice Holder
at the effective date of the Shelf Registration Statement) shall be named as a
selling securityholder in the Shelf Registration Statement or related Prospectus
in accordance with the requirements of this Section 2(e). Notwithstanding the
foregoing, if (A) the Notes are called for redemption and the then prevailing
market price of the Common Shares is above the Exchange Price or (B) the Notes
are exchanged as provided for in Section 4.02 of the Indenture, then the Company
shall file any post-effective amendment or supplement within five Business Days
of the redemption date or the end of the exchange period, as applicable.
     3. Registration Procedures. The following provisions shall apply in
connection with the Shelf Registration Statement.
     (a) The Company shall:

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     (i) furnish to the Representative and to counsel for the Notice Holders,
not less than five Business Days prior to the filing thereof with the
Commission, a copy of the Shelf Registration Statement and each amendment
thereto and each amendment or supplement, if any, to the Prospectus included
therein (including all documents incorporated by reference therein after the
initial filing) and shall use its reasonable efforts to reflect in each such
document, when so filed with the Commission, such comments as the Representative
reasonably proposes; and
     (ii) include information regarding the Notice Holders and the methods of
distribution they have elected for their Registrable Securities provided to the
Company in Notices and Questionnaires as necessary to permit such distribution
by the methods specified therein.
     (b) The Company shall ensure that:
     (i) the Shelf Registration Statement and any amendment thereto and any
Prospectus forming part thereof and any amendment or supplement thereto complies
in all material respects with the Act; and
     (ii) the Shelf Registration Statement and any amendment thereto does not,
when it becomes effective, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading.
     (c) The Company shall advise the Representative, the Notice Holders and any
underwriter that has provided in writing to the Company a telephone or facsimile
number and address for notices, and confirm such advice in writing, if requested
(which notice pursuant to clauses (ii)-(v) of this Section 3(c) shall be
accompanied by an instruction to suspend the use of the Prospectus until the
Company shall have remedied the basis for such suspension):
     (i) when the Shelf Registration Statement and any amendment thereto has
been filed with the Commission and when the Shelf Registration Statement or any
post-effective amendment thereto has become effective;
     (ii) of any request by the Commission for any amendment or supplement to
the Shelf Registration Statement or the Prospectus or for additional
information;
     (iii) of the issuance by the Commission of any stop order suspending the
effectiveness of the Shelf Registration Statement or the institution or
threatening of any proceeding for that purpose;
     (iv) of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Common Shares included therein for sale
in any jurisdiction or the institution or threatening of any proceeding for such
purpose; and

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     (v) of the happening (without notice of the nature or details of such
events) of any event that requires any change in the Shelf Registration
Statement or the Prospectus so that, as of such date, they (A) do not contain
any untrue statement of a material fact and (B) do not omit to state a material
fact required to be stated therein or necessary to make the statements therein
(in the case of the Prospectus, in the light of the circumstances under which
they were made) not misleading.
     (d) The Company shall use its reasonable efforts to prevent the issuance of
any order suspending the effectiveness of the Shelf Registration Statement or
the qualification of the securities therein for sale in any jurisdiction and, if
issued, to obtain as soon as possible the withdrawal thereof. The Company shall
undertake additional actions as required to permit unrestricted resales of the
Common Shares in accordance with the terms and conditions of this Agreement.
     (e) Upon request, the Company shall furnish to each Notice Holder, without
charge, at least one copy of the Shelf Registration Statement and any
post-effective amendment thereto, including all material incorporated therein by
reference, and, if a Notice Holder so requests, all exhibits thereto (including
exhibits incorporated by reference therein).
     (f) During the Shelf Registration Period, if required by applicable law,
the Company shall promptly deliver to each Initial Purchaser, each Notice
Holder, and any sales or placement agents or underwriters acting on their
behalf, without charge, as many copies of the Prospectus (including the
preliminary Prospectus, if any) included in the Shelf Registration Statement and
any amendment or supplement thereto as any such person may reasonably request.
The Company consents to the use of the Prospectus or any amendment or supplement
thereto by each of the foregoing in connection with the offering and sale of the
Common Shares.
     (g) Prior to any offering of Common Shares pursuant to the Shelf
Registration Statement, the Company shall arrange for the qualification of the
Common Shares for sale under the laws of such jurisdictions as any Notice Holder
shall reasonably request and shall maintain such qualification in effect so long
as required; provided that in no event shall the Company be obligated to qualify
to do business in any jurisdiction where it is not then so qualified or to take
any action that would subject it to service of process in suits, other than
those arising out of the Initial Placement or any offering pursuant to the Shelf
Registration Statement, in any jurisdiction where it is not then so subject.
     (h) Upon the occurrence of any event contemplated by subsections (c)(ii)
through (v) above, the Company shall promptly (or within the time period
provided for by Section 3(i) hereof, if applicable) prepare a post-effective
amendment to the Shelf Registration Statement or an amendment or supplement to
the related Prospectus or file any other required document so that, as
thereafter delivered to Initial Purchasers of the securities included therein,
the Prospectus will not include an untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading.

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     (i) Upon the occurrence or existence of any pending corporate development,
public filings with the Commission or any other material event that, in the
reasonable judgment of the Company, makes it appropriate to suspend the
availability of the Shelf Registration Statement and the related Prospectus, the
Company shall give notice (without notice of the nature or details of such
events) to the Notice Holders that the availability of the Shelf Registration
Statement is suspended and, upon actual receipt of any such notice, each Notice
Holder agrees not to sell any Registrable Securities pursuant to the Shelf
Registration Statement until such Notice Holder’s receipt of copies of the
supplemented or amended Prospectus provided for in Section 3(h) hereof, or until
it is advised in writing by the Company that the Prospectus may be used, and has
received copies of any additional or supplemental filings that are incorporated
or deemed incorporated by reference in such Prospectus. The period during which
the availability of the Shelf Registration Statement and any Prospectus is
suspended (the “Deferral Period”) shall not exceed 45 days in any 90-day period
or 135 days in any 360-day period.
     (j) The Company shall comply with all applicable rules and regulations of
the Commission and shall make generally available to its securityholders an
earnings statement satisfying the provisions of Section 11(a) of the Act as soon
as practicable after the effective date of the Shelf Registration Statement and
in any event no later than 45 days after the end of a 12-month period (or
90 days, if such period is a fiscal year) beginning with the first month of the
Company’s first fiscal quarter commencing after the effective date of the Shelf
Registration Statement.
     (k) Subject to Section 6 hereof, the Company shall enter into customary
agreements (including, if requested, an underwriting agreement in customary
form) and take all other appropriate actions in order to expedite or facilitate
the registration or the disposition of the Common Shares, and in connection
therewith, if an underwriting agreement is entered into, cause the same to
contain customary indemnification provisions and procedures.
     (l) The Company shall use its reasonable efforts to take all other steps
necessary to effect the registration of the Common Shares covered by the Shelf
Registration Statement.
     4. Registration Expenses. The Company shall pay all Registration Expenses
in connection with any Shelf Registration Statement filed pursuant to Section
2(a) hereof (including the fees and disbursements of no more than one firm of
counsel for the Holders of the Registrable Securities in connection with the
review of any Shelf Registration Statement, Prospectus or amendment or
supplement thereto in accordance with the provisions of Section 3(a) hereof).
Except as provided herein, each Holder shall pay all commissions and transfer
taxes, if any, relating to the sale or disposition of such Holder’s Registrable
Securities pursuant to the Shelf Registration Statement.
     5. Indemnification and Contribution.
     (a) The Company and the Operating Partnership agree jointly and severally
to indemnify and hold harmless each Holder of Registrable Securities (including
each Initial Purchaser), its directors, officers, employees and agents, and each
person, if any, who controls

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any Holder within the meaning of the Securities Act or the Exchange Act (each,
an “Indemnified Holder”), against any loss, claim, damage, liability or expense,
as incurred, or any action in respect thereof (including, but not limited to,
any loss, claim, damage, liability or expense relating to resales of the
Registrable Securities) (collectively, “Losses”), to which such Indemnified
Holder may become subject, insofar as any such Loss arises out of or is based
upon:
     (i) any untrue statement or alleged untrue statement of a material fact
contained in (A) the Shelf Registration Statement as originally filed or in any
amendment thereof, or (B) any blue sky application or other document or any
amendment or supplement thereto prepared or executed by the Company (or based
upon written information furnished by or on behalf of the Company expressly for
use in such blue sky application or other document or amendment or supplement)
filed in any jurisdiction specifically for the purpose of qualifying any or all
of the Registrable Securities under the securities law of any state or other
jurisdiction (such application or document being hereinafter called a “Blue Sky
Application”), or, in each case, the omission or alleged omission to state
therein any material fact required to be stated therein or necessary to make the
statements therein not misleading; or
     (ii) any untrue statement or alleged untrue statement of a material fact
contained in any Issuer Free Writing Prospectus, any preliminary prospectus or
the Prospectus (or any amendment or supplement thereto), or the omission or
alleged omission therefrom of a material fact, in each case, necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading,
and to reimburse each Indemnified Holder for any and all expenses including the
reasonable fees and disbursements of counsel as such expenses are reasonably
incurred by such Indemnified Holder in connection with investigating, defending,
settling, compromising or paying any such Loss; provided, however, that the
foregoing indemnity agreement shall not apply to any Loss to the extent, but
only to the extent, arising out of or based upon any untrue statement or alleged
untrue statement or omission or alleged omission made in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such Holder (or its related Indemnified Holder) expressly for use therein. The
indemnity agreement set forth in this Section 6(a) shall be in addition to any
liabilities that the Company may otherwise have.
The Company and the Operating Partnership jointly and severally also agree to
indemnify as provided in this Section 6(a) or contribute as provided in Section
6(e) hereof to Losses of each underwriter, if any, of Registrable Securities
registered under a Shelf Registration Statement, their directors, officers,
employees or agents and each person who controls such underwriter on
substantially the same basis as that of the indemnification of the Initial
Purchasers and the selling Holders provided in this Section 6(a) and shall, if
requested by any Holder, enter into an underwriting agreement reflecting such
agreement.
     (b) Each Holder agrees, severally and not jointly, to indemnify and hold
harmless the Company and the Operating Partnership, each of its trustees, each
of its officers who sign the Shelf Registration Statement and each person, if
any, who controls the Company or

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the Operating Partnership within the meaning of the Securities Act or the
Exchange Act (i) to the same extent as the foregoing indemnity from the Company
and the Operating Partnership to each such Holder, but only with reference to
written information relating to such Holder furnished to the Company by or on
behalf of such Holder specifically for inclusion in the documents referred to in
the foregoing indemnity and (ii) against any Loss, joint or several, including,
but not limited to, any Loss relating to resales of the Registrable Securities,
to which such person may become subject, insofar as any such Loss arises out of,
or is based upon any Free Writing Prospectus used by such Holder without the
prior consent of the Issuer, and in connection with any underwritten offering,
the underwriters, provided that the indemnification obligation in this clause
(ii) shall be several, not joint and several, among the Holders who used such
Free Writing Prospectus. This indemnity agreement set forth in this Section
shall be in addition to any liabilities which any such Holder may otherwise
have.
     (c) Promptly after receipt by an indemnified party under this Section 6 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against an indemnifying party under this
Section 6, notify the indemnifying party in writing of the commencement thereof,
but the failure to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a) or (b) above unless and to the extent it did not
otherwise learn of such action and such failure results in the forfeiture by the
indemnifying party of substantial rights and defenses and (ii) will not, in any
event, relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraph (a) or
(b) above. In case any such action is brought against any indemnified party and
such indemnified party seeks or intends to seek indemnity from an indemnifying
party, the indemnifying party will be entitled to participate in, and, to the
extent that it shall elect, jointly with all other indemnifying parties
similarly notified, by written notice delivered to the indemnified party
promptly after receiving the aforesaid notice from such indemnified party, to
assume the defense thereof with counsel satisfactory to such indemnified party
in its reasonable discretion; provided, however, if the defendants in any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that a conflict may arise
between the positions of the indemnifying party and the indemnified party in
conducting the defense of any such action or that there may be legal defenses
available to it and/or other indemnified parties that are different from or
additional to those available to the indemnifying party, the indemnified party
or parties shall have the right to select separate counsel to assume such legal
defenses and to otherwise participate in the defense of such action on behalf of
such indemnified party or parties. Upon receipt of notice from the indemnifying
party to such indemnified party of such indemnifying party’s election so to
assume the defense of such action and approval by the indemnified party of
counsel, the indemnifying party will not be liable to such indemnified party
under this Section 6 for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel (other than local counsel), reasonably approved by the
indemnifying party, representing the indemnified parties who are parties to such
action) or (ii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party in its reasonable discretion to represent
the indemnified party within a reasonable time after notice of commencement of
the action, in each of which cases the reasonable fees and expenses of counsel
shall be at the expense of the indemnifying party.

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     (d) The indemnifying party under this Section 6 shall not be liable for any
settlement of any proceeding effected without its written consent, which shall
not be withheld unreasonably, but if settled with such consent or if there is a
final judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party against any Loss by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party
for reasonable fees and expenses of counsel as contemplated by Section 6(c)
hereof, the indemnifying party agrees that it shall be liable for any settlement
of any proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement, compromise or consent to the entry
of judgment in any pending or threatened action, suit or proceeding in respect
of which any indemnified party is or could have been a party and indemnity was
or could have been sought hereunder by such indemnified party, unless such
settlement, compromise or consent includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such action, suit or proceeding.
     (e) If the indemnification provided for in Section 6 is for any reason
unavailable to or otherwise insufficient to hold harmless an indemnified party
in respect of any Loss referred to therein, then each indemnifying party shall
contribute to the aggregate amount paid or payable by such indemnified party, as
incurred, as a result of any Loss referred to therein:
     (i) in such proportion as is appropriate to reflect the relative benefits
received by the Company and the Operating Partnership, on the one hand, and the
Holders, on the other hand, from the offering and sale of the Registrable
Securities, on the one hand, and a Holder with respect to the sale by such
Holder of the Registrable Securities, on the other hand, or
     (ii) if the allocation provided by Section (6)(e)(i) above is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in Section 6(e)(i) above but also the relative
fault of the Company and the Operating Partnership, on the one hand, and the
Holders, on the other hand, in connection with the statements or omissions or
alleged statements or omissions that resulted in such Loss, as well as any other
relevant equitable considerations.
The relative benefits received by the Company and the Operating Partnership, on
the one hand, and the Holders, on the other hand, in connection with such
offering and such sale of the Registrable Securities pursuant to this Agreement
shall be deemed to be in the same respective proportions as the total net
proceeds from the offering of the Notes purchased under the Purchase Agreement
(before deducting expenses) received by the Company and the Operating
Partnership and the total proceeds received by the Holders with respect to their
sale of Registrable Securities. The relative fault of the Company and the
Operating Partnership, on the one hand, and the Holders, on the other hand,
shall be determined by reference to, among other things, whether any such untrue
or alleged untrue statement of a material fact or omission or alleged omission
to state

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a material fact relates to information supplied by the Company and the Operating
Partnership, on the one hand, or the Holders, on the other hand, and the
parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company, the Operating
Partnership and the Holders agree that it would not be just and equitable if
contribution pursuant to this Section 6(e) were determined by pro rata
allocation (even if the Holders were treated as one entity for such purpose) or
by any other method of allocation that does not take account of the equitable
considerations referred to in this Section 6(e).
The amount paid or payable by a party as a result of the Loss referred to above
shall be deemed to include, subject to the limitations set forth in
Section 6(c), any legal or other fees or expenses reasonably incurred by such
party in connection with investigating or defending any action or claim.
Notwithstanding the provisions of this Section 6, in no event will (i) any
Holder be required to undertake liability to any person under this Section 6 for
any amounts in excess of the dollar amount of the proceeds to be received by
such Holder from the sale of such Holder’s Registrable Securities (after
deducting any fees, discounts and commissions applicable thereto) pursuant to
any Shelf Registration Statement under which such Registrable Securities are to
be registered under the Securities Act and (ii) any underwriter be required to
undertake liability to any person hereunder for any amounts in excess of the
discount or commission payable to such underwriter with respect to the
Registrable Securities underwritten by it and distributed to the public. No
Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation. The Holders’
obligations to contribute as provided in this Section 6(e) are several and not
joint.
     (f) The provisions of this Section 6 shall remain in full force and effect,
regardless of any investigation made by or on behalf of any Holder or the
Company, the Operating Partnership or any of the officers, directors, employees,
agents or controlling persons referred to in Section 6 hereof, and will survive
the sale by a Holder of Registrable Securities.
     6. Underwritten Registrations. (a) In no event will the method of
distribution of Registrable Securities take the form of an underwritten offering
without the prior written consent of the Company.
     (b) If any Common Shares covered by the Shelf Registration Statement are to
be sold in an underwritten offering, the Managing Underwriters shall be selected
by the Company, subject to the prior written consent of the Majority Holders.
     (c) No person may participate in any underwritten offering pursuant to the
Shelf Registration Statement unless such person (i) agrees to sell such person’s
Common Shares on the basis reasonably provided in any underwriting arrangements
approved by the persons entitled hereunder to approve such arrangements; and
(ii) completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the terms
of such underwriting arrangements.

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     7. Registration Defaults. If any of the following events shall occur, then
the Operating Partnership shall pay liquidated damages (the “Additional
Interest”) to the Holders as follows:
     (a) if the Shelf Registration Statement (which shall be an Automatic Shelf
Registration Statement if the Company is then a WKSI on the date of such filing)
is not filed with the Commission on or prior to May 1, 2007 then, commencing on
May 2, 2007, Additional Interest shall accrue on the aggregate outstanding
principal amount of the Notes at a rate of 0.25% per annum for the first 90 days
from and including April 16, 2007 and 0.50% per annum thereafter; or
     (b) if the Shelf Registration Statement is not declared effective by the
Commission (or has not become effective in the case of an Automatic Shelf
Registration Statement) on or prior to the 210th day following the Closing Date,
then commencing on the 211st day after the Closing Date, Additional Interest
shall accrue on the aggregate outstanding principal amount of the Notes at a
rate of 0.25% per annum for the first 90 days from and including such 211st day
and 0.50% per annum thereafter; or
     (c) if the Shelf Registration Statement has been declared or become
effective but ceases to be effective or usable for the offer and sale of the
Registrable Securities, other than in connection with (A) a Deferral Period or
(B) as a result of a requirement to file a post-effective amendment or
supplement to the Prospectus to make changes to the information regarding
selling securityholders or the plan of distribution provided for therein, at any
time during the Shelf Registration Period and the Company does not cure the
lapse of effectiveness or usability within ten Business Days by a post-effective
amendment, prospectus supplement or report filed under the Exchange Act (or, if
a Deferral Period is then in effect and subject to the 20 Business Day filing
requirement and the proviso regarding the filing of post-effective amendments in
Section 2(e) with respect to any Notice and Questionnaire received during such
period, within ten Business Days following the expiration of such Deferral
Period or period permitted pursuant to Section 2(e)) then Additional Interest
shall accrue on the aggregate outstanding principal amount of the Notes at a
rate of 0.25% per annum for the first 90 days from and including the day
following such tenth Business Day and 0.50% per annum thereafter; or
     (d) if the Company through its omission fails to name as a selling
securityholder any Holder that had timely complied with its obligations
hereunder in a manner to entitle such Holder to be so named in (i) the Shelf
Registration Statement at the time it first became effective or (ii) any
post-effective amendment to the Shelf Registration Statement or any Prospectus
at the later of time of filing thereof or the time the Shelf Registration
Statement of which the Prospectus forms a part becomes effective then Additional
Interest shall accrue, on the aggregate outstanding principal amount of the
Notes held by such Holder, at a rate of 0.25% per annum for the first 90 days
from and including the day following the effective date of such Shelf
Registration Statement or post-effective amendment or the time of filing of such
Prospectus, as the case may be, and 0.50% per annum thereafter; or
     (e) if the aggregate duration of Deferral Periods in any period exceeds the
number of days permitted in respect of such period pursuant to Section 3(i)
hereof, then commencing on the day the aggregate duration of Deferral Periods in
any period exceeds the

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number of days permitted in respect of such period, Additional Interest shall
accrue on the aggregate outstanding principal amount of the Notes at a rate of
0.25% per annum for the first 90 days from and including such date, and 0.50%
per annum thereafter;
provided, however, that (1) upon the filing of the Shelf Registration Statement
(in the case of paragraph (a) above), (2) upon the effectiveness of the Shelf
Registration Statement (in the case of paragraph (b) above), (3) upon such time
as the Shelf Registration Statement which had ceased to remain effective or
usable for resales again becomes effective and usable for resales (in the case
of paragraph (c) above), (4) upon the time such Holder is permitted to sell its
Registrable Securities pursuant to any Shelf Registration Statement and
Prospectus in accordance with applicable law (in the case of paragraph
(d) above) (5) upon the termination of the Deferral Period that caused the limit
on the aggregate duration of Deferral Periods in a period set forth in Section
3(i) to be exceeded (in the case of paragraph (e) above) or (6) upon the date
the Shelf Registration Statement is no longer required to be kept effective, the
Additional Interest shall cease to accrue.
     Any amounts of Additional Interest due pursuant to this Section 7 will be
payable in cash on the next succeeding interest payment date to Holders entitled
to receive such Additional Interest on the relevant record dates for the payment
of interest. If any Note ceases to be outstanding during any period for which
Additional Interest are accruing, the Company will prorate the Additional
Interest payable with respect to such Note.
     The Additional Interest rate on the Notes shall not exceed 0.50% per annum
in the aggregate. Notwithstanding any provision in this Agreement, in no event
shall Additional Interest accrue to holders of Common Shares issued upon
exchange of Notes. In lieu thereof, the Company shall increase the Conversion
Rate (as defined in the Indenture) by 3% for each $1,000 principal amount of
Notes exchanged at a time when such Registration Default has occurred and is
continuing.
     8. No Inconsistent Agreements. Neither the Company nor the Operating
Partnership has entered into, and each agrees not to enter into, any agreement
with respect to its securities that is inconsistent with the registration rights
granted to the Holders herein.
     9. Rule 144A and Rule 144. So long as any Registrable Securities remain
outstanding, the Company shall use its reasonable best efforts to file the
reports required to be filed by it under Rule 144A(d)(4) under the Act and the
Exchange Act in a timely manner and, if at any time the Company is not required
to file such reports, it will, upon the written request of any Holder of
Registrable Securities, make publicly available other information so long as
necessary to permit sales of such Holder’s Registrable Securities pursuant to
Rules 144 and 144A of the Act. The Company covenants that it will take such
further action as any Holder of Registrable Securities may reasonably request,
all to the extent required from time to time to enable such Holder to sell
Registrable Securities without registration under the Act within the limitation
of the exemptions provided’ by Rules 144 and 144A (including, without
limitation, the requirements of Rule 144A(d)(4)). Upon the written request of
any Holder of Registrable Securities, the Company shall deliver to such Holder a
written statement as to whether it has complied with such requirements.
Notwithstanding the foregoing, nothing in this Section 9 shall

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be deemed to require the Company or the Operating Partnership to register any of
its securities pursuant to the Exchange Act.
     10. Listing. The Company shall use its reasonable efforts to obtain the
approval of the Common Shares for listing on the New York Stock Exchange.
     11. Amendments and Waivers. The provisions of this Agreement may not be
amended, qualified, modified or supplemented, and waivers or consents to
departures from the provisions hereof may not be given, unless the Company has
obtained the written consent of the Majority Holders; provided that, with
respect to any matter that directly or indirectly affects the rights of any
Initial Purchaser hereunder, the Company shall obtain the written consent of
each such Initial Purchaser against which such amendment, qualification,
supplement, waiver or consent is to be effective; provided, further, that no
amendment, qualification, supplement, waiver or consent with respect to
Section 7 hereof shall be effective as against any Holder of Registrable
Securities unless consented to in writing by such Holder; and provided, further,
that the provisions of this Article 11 may not be amended, qualified, modified
or supplemented, and waivers or consents to departures from the provisions
hereof may not be given, unless the Company has obtained the written consent of
the Initial Purchasers and each Holder.
     12. Notices. All notices and other communications provided for or permitted
hereunder shall be made in writing by hand-delivery, first-class mail, telex,
telecopier or air courier guaranteeing overnight delivery:
     (a) if to a Holder, at the most current address given by such holder to the
Company in accordance with the provisions of the Notice and Questionnaire;
     (b) if to the Initial Purchasers or the Representative, initially at the
address or addresses set forth in the Purchase Agreement; and
     (c) if to the Company or the Operating Partnership, initially at its
address set forth in the Purchase Agreement.
     All such notices and communications shall be deemed to have been duly given
when received.
     The Initial Purchasers, the Company or the Operating Partnership by notice
to the other parties may designate additional or different addresses for
subsequent notices or communications.
     Notwithstanding the foregoing, notices given to Holders holding Notes in
book-entry form may be given through the facilities of DTC or any successor
depositary.
     13. Successors. This Agreement shall inure to the benefit of and be binding
upon the parties hereto, their respective successors and assigns, including,
without the need for an express assignment or any consent by the Company or the
Operating Partnership thereto, subsequent Holders of Common Shares, and the
indemnified persons referred to in Section 5 hereof. The Company and the
Operating Partnership hereby agree to extend the benefits of this

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Agreement to any Holder of Common Shares, and any such Holder may specifically
enforce the provisions of this Agreement as if an original party hereto.
     14. Third Party Beneficiaries. Each Holder shall be a third party
beneficiary of the agreements made hereunder between the Company and the Initial
Purchasers, and the Initial Purchasers shall have the right to enforce such
agreements directly to the extent it deems such enforcement necessary or
advisable to protect its rights or the rights of Holders hereunder.
     15. Counterparts. This Agreement may be signed in one or more counterparts,
each of which shall constitute an original and all of which together shall
constitute one and the same agreement.
     16. Headings. The section headings used herein are for convenience only and
shall not affect the construction hereof.
     17. Applicable Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed in the State of New York. The parties hereto each hereby
waive any right to trial by jury in any action, proceeding or counterclaim
arising out of or relating to this Agreement.
     18. Severability. In the event that any one of more of the provisions
contained herein, or the application thereof in any circumstances, is held
invalid, illegal or unenforceable in any respect for any reason, the validity,
legality and enforceability of any such provision in every other respect and of
the remaining provisions hereof shall not be in any way impaired or affected
thereby, it being intended that all of the rights and privileges of the parties
shall be enforceable to the fullest extent permitted by law.
     19. Common Shares Held by the Company, etc. Whenever the consent or
approval of Holders of a specified percentage of principal amount of Common
Shares is required hereunder, Common Shares held by the Company or its
Affiliates (other than subsequent Holders of Common Shares if such subsequent
Holders are deemed to be Affiliates solely by reason of their holdings of such
Common Shares) shall not be counted in determining whether such consent or
approval was given by the Holders of such required percentage.

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If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicate hereof, whereupon this
letter and your acceptance shall represent a binding agreement by and among the
Company, the Operating Partnership and the several Initial Purchasers.

                  Very truly yours,    
 
                FIRST POTOMAC REALTY TRUST    
 
           
 
  By:   /s/ Barry H. Bass
 
        Name: Barry H. Bass         Title:   Executive Vice President and CFO  
 
 
                FIRST POTOMAC REALTY
INVESTMENT LIMITED PARTNERSHIP    
 
                By: First Potomac Realty Trust, its
General Partner    
 
           
 
  By:   /s/ Barry H. Bass
 
        Name: Barry H. Bass         Title:   Executive Vice President and CFO  
 

The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
Acting on behalf of itself and as Representative of
the several Initial Purchasers
WACHOVIA CAPITAL MARKETS, LLC

         
By:
  /s/ Michael Golden    
 
 
 
    Name: Michael Golden     Title:   Vice President    

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