================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K (Mark one) /X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1999 or / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______________ to ______________ Commission file number 0-20047 CORPORATE OFFICE PROPERTIES TRUST (Exact name of registrant as specified in its charter) MARYLAND 23-2947217 (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) 8815 CENTRE PARK DRIVE, SUITE 400 21045 COLUMBIA, MD (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (410) 730-9092 ---------------------------------------- Securities registered pursuant to Section 12(b) of the Act: (Title of Each Class) (Name of Exchange on Which Registered) COMMON SHARE OF BENEFICIAL INTEREST, NEW YORK STOCK EXCHANGE $0.01 PAR VALUE SERIES B CUMULATIVE REDEEMABLE PREFERRED SHARE OF BENEFICIAL INTEREST NEW YORK STOCK EXCHANGE $0.01 PAR VALUE Securities registered pursuant to Section 12(g) of the Act: NONE Indicate by check mark whether the (1) registrant has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. [X] Yes [ ] No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (Section 229.405 of this chapter) is not contained herein, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ] The aggregate market value of the voting stock held by non-affiliates of the registrant was $74,850,000 based on the closing price of such Shares on the New York Stock Exchange on March 14, 2000. At March 14, 2000 17,658,546 shares of the Registrant's Common Shares of Beneficial Interest, $0.01 par value, were outstanding. Portions of the annual shareholder report for the year ended December 31, 1999 are incorporated by reference into Parts I and II of this report and portions of the proxy statement of the Registrant for its 2000 Annual Meeting of Shareholders to be filed within 120 days after the end of the fiscal year covered by this Form 10-K are incorporated by reference into Part III of this Form 10-K. ================================================================================ Table of Contents Form 10-K PART I ITEM 1. BUSINESS.....................................................................................3 ITEM 2. PROPERTIES...................................................................................9 ITEM 3. LEGAL PROCEEDINGS...........................................................................13 ITEM 4. SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS........................................13 PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS.......................14 ITEM 6. SELECTED FINANCIAL DATA TABLE...............................................................14 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS...............................................................................14 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK..................................14 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.................................................14 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE........................................................................14 PART III ITEM 10. TRUSTEES AND EXECUTIVE OFFICERS OF THE REGISTRANT...........................................14 ITEM 11. EXECUTIVE COMPENSATION......................................................................14 ITEM 12. SECURITY OWNERSHIP AND CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.............................14 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS..............................................14 PART IV ITEM 14 EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.............................14
FORWARD-LOOKING STATEMENTS This Form 10-K contains "forward-looking" statements, as defined in the Private Securities Litigation Reform Act of 1995 that are based on our current expectations, estimates and projections about future events and financial trends affecting the financial condition of the business. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. These statements are not guarantees of future performance, events or results and involve potential risks and uncertainties. Accordingly, actual results may differ materially. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. Important facts that may affect these expectations, estimates or projections include, but are not limited to: our ability to borrow on favorable terms; general economic and business conditions, which will, among other things affect office property demand and rents, tenant creditworthiness, interest rates and financing availability; adverse changes in the real estate markets including, among other things, competition with other companies; risks of real estate acquisition and development; governmental actions and initiatives and environmental requirements. 2 PART I ITEM 1. BUSINESS OUR COMPANY Corporate Office Properties Trust ("COPT") is a fully integrated and self-managed real estate investment trust ("REIT"). We focus principally on the ownership, management, leasing, acquisition and development of suburban office buildings located in select submarkets in the Mid-Atlantic region of the United States. As of December 31, 1999, we: - - owned 77 suburban office properties in Maryland, Pennsylvania and New Jersey containing approximately 5.9 million rentable square feet, - - owned two retail properties containing approximately 191,000 rentable square feet, - - achieved a 97.5% occupancy rate on our properties, - - had construction underway on five new buildings totaling approximately 407,000 square feet that were 49% pre-leased and redevelopment underway on a 57,000 square foot existing building that was 100% pre-leased, and - - owned options to purchase 72 acres of land contiguous to certain of our office properties from related parties. We conduct almost all of our operations through our Operating Partnership, Corporate Office Properties, L.P., a Delaware limited partnership, for which we are the managing general partner. Our Operating Partnership owns real estate both directly and through subsidiaries. Interests in our Operating Partnership are in the form of Common and Preferred Units. As of December 31, 1999, we owned approximately 60% of the outstanding Common Units and approximately 70% of the outstanding Preferred Units. The remaining Common and Preferred Units in our Operating Partnership were owned by third parties, which included certain of our officers and trustees. The Operating Partnership also owns the principal economic interest and, collectively with our Chief Executive Officer and Chief Operating Officer, 49.5% of the voting stock of Corporate Office Management, Inc. ("COMI"). COMI provides us with asset management and managerial, financial and legal support. COMI also has three subsidiaries: Corporate Realty Management, LLC ("CRM"), Corporate Development Services, LLC ("CDS") and Martin G. Knott and Associates, LLC ("MGK"). CRM manages approximately 16.6 million square feet for us and for third parties as of December 31, 1999 and also provides corporate facilities management. CDS provides construction and development services predominantly to us. MGK provides heating and air conditioning maintenance and repair services. COMI owns 75% of CRM, 100% of CDS and 80% of MGK. We believe that we are organized and have operated in a manner that permits us to satisfy the requirements for taxation as a REIT under the Internal Revenue Code of 1986, as amended, and we intend to continue to operate in such a manner. If we qualify for taxation as a REIT, we generally will not be subject to federal income tax on our taxable income that is distributed to our shareholders. A REIT is subject to a number of organizational and operational requirements, including a requirement that it currently distribute to its shareholders at least 95% of its annual taxable income (excluding net capital gains). Our executive offices are located at 8815 Centre Park Drive, Suite 400, Columbia, MD 21045 and our telephone number is (410) 730-9092. 3 SIGNIFICANT 1999 DEVELOPMENTS During 1999, we acquired 29 suburban office properties. A summary of these acquisitions follows (dollars in thousands):
Number Date of of Total Rentable Initial Project Name Location Acquisition Buildings Square Feet Cost - --------------------------------- -------------------- ----------- ----------- -------------- -------- Airport Square XXI Linthicum, MD 2/23/99 1 67,913 $ 6,751 Parkway Crossing Properties Hanover, MD 4/16/99 2 99,026 9,524 Commons Corporate Center (1) Hanover, MD 4/28/99 8 250,413 25,442 Princeton Executive Center Monmouth Junction, NJ 6/24/99 1 61,300 6,020 Gateway Central (2) Harrisburg, PA 8/12/99 3 55,726 5,960 Gateway International (3) Linthicum, MD 11/18/99 2 198,438 24,316 Corporate Gateway Center (4) Harrisburg, PA 12/3/99 9 417,138 40,082 Timonium Business Park Timonium, MD 12/21/99 2 233,623 30,001 Brown's Wharf (5) Baltimore, MD 12/21/99 1 103,670 10,607
(1) Does not include $400 allocated to projects under construction and $50 relating to land under a ground lease. (2) Acquired 89% ownership interest from an officer and Trustee of ours. (3) Does not include $1,973 allocated to projects under construction. (4) Acquired 49% interest on September 15, 1999. Acquired remaining 51% interest on December 3, 1999. (5) The Brown's Wharf property was sold on 6/24/99 and then contributed into the Operating Partnership by the purchaser on 12/21/99 (see Note 4 to the consolidated financial statements as of and for the year ended December 31, 1999 included in Exhibit 13.1 to this Form 10-K and incorporated by reference). During 1999, we also acquired six parcels of land that are contiguous to certain of our operating properties and a 57,000 square foot warehouse facility located in South Brunswick, New Jersey that we are redeveloping into office space. During 1999, we completed the construction of two office buildings totaling 202,219 square feet. The office buildings are located in Annapolis Junction, Maryland and Columbia, Maryland. Costs incurred on these properties through December 31, 1999 totaled $23.2 million. We also completed an expansion project that increased the rentable square footage of one of our properties by 6,350 square feet. As of December 31, 1999 we had construction underway on five new buildings and redevelopment underway on an existing building. We sold nine properties during 1999 for $53.5 million, generating net proceeds after property level debt repayments, transaction costs and operating revenue and cost pro rations of $31.2 million. A summary of these sales follows (dollars in thousands):
Property Date of Total Rentable Sales Project Name Location Type (1) Sale Square Feet Price - --------------------- ------------------ -------- ------- -------------- --------- Cranberry Square Westminster, MD R 1/22/99 139,988 $ 18,900 Delafield Retail Delafield, WI R 2/26/99 52,800 3,303 Indianapolis Retail Indianapolis, IN R 3/09/99 67,541 5,735 Plymouth Retail Plymouth, MN R 3/09/99 67,510 5,465 Glendale Retail Glendale, WI R 5/04/99 36,248 1,900 Peru Retail Peru, IL R 6/16/99 60,232 3,750 Browns Wharf (2) Baltimore, MD O 6/24/99 103,670 10,575 Oconomowoc Retail Oconomowoc, WI R 6/25/99 39,272 2,575 Brandon One Riveria Beach, MD O 12/30/99 38,513 1,260
(1) "R" indicates retail property; "O" indicates office property. (2) The Brown's Wharf property was sold on 6/24/99 and then contributed into the Operating Partnership by the purchaser on 12/21/99 (see Note 4 to the consolidated financial statements as of and for the year ended December 31, 1999 included in Exhibit 13.1 to this Form 10-K and incorporated by reference). 4 A summary of our significant financing activities during 1999 follows: - - we completed the sale of 1,250,000 Series B Cumulative Redeemable Preferred Shares to the public at a price of $25.00 per share, - - we issued 974,662 Series C Preferred Units in our Operating Partnership valued at $25.00 per share, - - we issued 577,251 Common Units in our Operating Partnership, - - we received $165.2 million from new borrowing arrangements, and - - we obtained a $50.0 million line of credit with Prudential Securities Credit Corporation bearing an interest rate of LIBOR plus 1.5% on outstanding borrowings (no borrowings were made under this loan during 1999). SUBSEQUENT EVENT On February 10, 2000, we entered into a $6.9 million construction loan facility with Summit Bank to finance the redevelopment of a 57,000 square foot warehouse facility into office space. This loan bears interest at LIBOR plus 1.75%. The loan matures on February 28, 2001 and may be extended for a two-year period, subject to certain conditions. OUR OPERATING STRATEGY Our primary business objectives are to achieve sustainable long-term growth in funds from operations per share and to maximize long-term shareholder value. We seek to achieve these objectives by implementing our focused operating and growth strategies. Key elements of this strategy include: SUBURBAN OFFICE FOCUS. We focus on the ownership, management, leasing, acquisition and development of suburban office properties. We believe office buildings currently offer the strongest fundamentals of any real estate property type, and suburban office properties offer us very attractive investment opportunities. The three key factors driving the strong fundamentals of suburban office properties are (i) increasing rental rates, (ii) low vacancy rates, and (iii) a limited supply of new office product. Additionally, we believe that many companies are relocating to, and expanding in, suburban locations because of total lower costs, proximity to residential housing and better quality of life. GEOGRAPHIC AND SUBMARKET FOCUS. We focus on operating in select, demographically strong and growing markets, within the Mid-Atlantic region of the United States, where we believe we can achieve the critical mass necessary to maximize management efficiencies, operating synergies, tenant services and competitive advantages through our acquisition, property management and development programs. By focusing within specific submarkets where our management has extensive experience and market knowledge, we believe we can achieve submarket prominence that will lead to better operating results. OFFICE PARK FOCUS. We focus on owning and operating properties located in established suburban corporate office parks. We believe the suburban office park environment generally attracts longer-term tenants, including high-quality corporations seeking to attract and retain quality work forces, because these parks are typically situated along major transportation routes with easy access to support services, amenities and residential communities. CORPORATE TENANTS. We focus on leasing to large, high-quality corporations with significant space requirements. To enhance the stability of our cash flow, we typically structure our leases with terms ranging from three to ten years. We believe this strategy enables us to establish long-term relationships with quality tenants and, coupled with our geographic and submarket focus, enhances our ability to become the low-cost provider and the landlord of choice in our targeted markets. ACQUISITION STRATEGIES. We actively pursue the acquisition of suburban office properties through our three-part acquisition strategy. This strategy includes targeting: (i) entity acquisitions of significant portfolios along with their management to establish prominent ownership positions in new submarkets and enhance our management infrastructure and local expertise, (ii) portfolio purchases to enhance our existing submarket positions as well as enter selective new 5 submarkets, and (iii) opportunistic acquisitions of individual properties in our existing submarkets. We seek to make acquisitions at attractive yields and below replacement costs. We also look at each acquisition for opportunities to reposition the properties and achieve rental increases through re-leasing activities. PROPERTY DEVELOPMENT STRATEGIES. We balance our acquisition program through selective development and expansion of suburban office properties when market conditions and leasing opportunities support favorable risk-adjusted returns. We pursue development opportunities principally in response to the needs of existing and prospective new tenants. We develop sites that are in close proximity to our existing properties. We believe developing such sites enhances our ability to effectively meet tenant needs and efficiently provide critical tenant services. THIRD PARTY MANAGEMENT. In addition to operating and leasing our portfolio, we provide, through CRM, property management and a full-range of fee-based services to a wide variety of institutional owners. We believe this activity provides us with an additional source of stable income and gives us competitive advantages. These advantages include enhanced tenant satisfaction and property performance and lead to potential tenant expansions, acquisitions and build-to-suit development opportunities. Additionally, we believe CRM's established infrastructure has the capacity to support a larger asset base and will enhance our ability to expand our portfolio in existing and new submarkets without significantly increasing our overhead. TENANT SERVICES. Our investment through COMI in CRM, CDS and MGK has played a vital role in maintaining our high levels of tenant satisfaction and retention. We believe that further expanding our tenant service capabilities will continue to contribute positively to the operations of our properties and become an additional source of revenue and earnings. During 2000, CRM acquired 100% of the interests in Corporate Realty Advisors, an entity that provides lease audit services. Other services we expect to begin providing in 2000 include energy management and concierge services. INTERNAL GROWTH STRATEGIES. We aggressively manage our portfolio to maximize the operating performance of each property through: (i) proactive property management and leasing, (ii) achieving operating efficiencies through increasing economies of scale, (iii) renewing tenant leases and re-tenanting at increased rents where market conditions permit, and (iv) expanding our third party property management business and other tenant and real estate service capabilities. These strategies are designed to promote tenant satisfaction, resulting in tenant retention and the attraction of new tenants. FINANCING POLICY We pursue a capitalization strategy aimed at maintaining a flexible capital structure in order to facilitate consistent growth and performance through all real estate and economic market conditions. Key components of our policy include: DEBT STRATEGY. We primarily utilize property-level mortgage debt as opposed to corporate unsecured debt. We believe the commercial mortgage debt market is a more mature and generally more stable market for real estate companies, which provides us with greater access to capital on a more consistent basis and, generally, on more favorable terms. Additionally, we seek to utilize long-term, fixed rate debt which we believe enhances the stability of our cash flow. On a consolidated basis, we seek to maintain a minimum debt service coverage ratio of 1.6 to 1.0, which we believe is generally consistent with the current minimum investment grade requirement for mortgages securing commercial real estate. We believe this ratio is appropriate for a seasoned portfolio of suburban office properties. EQUITY STRATEGY. We seek to maximize the benefits of our Operating Partnership organizational structure by emphasizing the issuance of our Operating Partnership units as an equity source to finance our property acquisition program. This strategy provides prospective property sellers the ability to defer taxable gains by receiving our units in lieu of cash and reduces the need for us to access the equity and debt markets. MORTGAGE LOANS PAYABLE For information relating to future maturities of our mortgage loans payable, you should refer to the "Management's Discussion and Analysis of Financial Condition and Results of Operations" and Note 7 to the Consolidated Financial Statements included in Exhibit 13.1 to this Form 10-K which is incorporated herein by reference. 6 INDUSTRY SEGMENTS We have five segments: Baltimore/Washington Corridor office, Greater Philadelphia office, Northern/Central New Jersey office, Greater Harrisburg office and retail. For information relating to these segments, you should refer to Note 13 of our Consolidated Financial Statements included in Exhibit 13.1 to this Form 10-K which is incorporated herein by reference. EMPLOYEES We, together with COMI and its subsidiaries, employed 149 persons as of December 31, 1999. COMPETITION The commercial real estate market is highly competitive. Numerous commercial properties compete for tenants with our properties and our competitors are building additional properties in the markets in which our properties are located. Some of these competing properties may be newer or have more desirable locations than our properties. If the market does not absorb newly constructed space, market vacancies will increase and market rents may decline. As a result, we may have difficulty leasing space at our properties and may be forced to lower the rents we charge on leases to compete effectively. We also compete for the purchase of commercial property with many entities, including other publicly-traded commercial REITs. Many of our competitors have substantially greater financial resources than ours. In addition, our competitors may be willing to accept lower returns on their investments. If our competitors prevent us from buying the amount of properties that we have targeted for acquisition, we may not be able to meet our property acquisition and development goals. MAJOR TENANTS As of December 31, 1999, ten tenants accounted for 45.0% of our annualized office rents. Two of these tenants accounted for approximately 23.3% of our total annualized office rents. Our largest tenant is the United States Federal government, two agencies of which lease space in 13 of our office properties. These leases represented approximately 15.5% of our total annualized office rents as of December 31, 1999. Generally, these government leases provide for one-year terms or provide for termination rights. The government may terminate its leases if, among other reasons, the Congress of the United States fails to provide funding. The Congress of the United States has appropriated funds for these leases through September of 2000. The second largest tenant, Unisys Corporation, represented 7.8% of our annualized office rents as of December 31, 1999 and 16.9% of our 1999 net operating income since Unisys pays all of its property operating expenses directly. Unisys occupies space in three of our office properties. If either the Federal government or Unisys fails to make rental payments to us, or if the Federal government elects to terminate several of its leases and the space cannot be re-leased on satisfactory terms, our financial performance and ability to make expected distributions to shareholders would be materially adversely affected. GEOGRAPHICAL CONCENTRATION All of our office properties are located in the Mid-Atlantic region of the United States, and 56.4% of our total revenues for the year ended December 31, 1999 was earned from our office properties located in the Baltimore/Washington Corridor. Consequently, we do not have a broad geographical distribution of our properties. As a result, a decline in the real estate market or economic conditions generally in the Mid-Atlantic region could have a material adverse affect on our operations. DEVELOPMENT AND CONSTRUCTION ACTIVITIES Although the majority of our investments are in currently leased properties, to a lesser extent we also develop properties, including some which are not fully pre-leased. When we develop properties, we run the risks that development costs will exceed our budgets, that we will experience construction and development delays and that project leasing will not occur. 7 ENVIRONMENTAL MATTERS We are subject to various Federal, state and local environmental laws. These laws can impose liability on property owners or operators for the costs of removal or remediation of certain hazardous substances released on a property, even if the property owner was not responsible for the release of the hazardous substances. The presence of hazardous substances on our properties may adversely affect occupancy and our ability to sell or borrow against those properties. In addition to the costs of government claims under environmental laws, private plaintiffs may bring claims for personal injury or similar reasons. Various laws also impose liability for the costs of removal or remediation of hazardous substances at the disposal or treatment facility. Anyone who arranges for the disposal or treatment of hazardous substances at such a facility is potentially liable under such laws. These laws often impose liability whether or not the facility is or ever was owned or operated by such person. 8 ITEM 2. PROPERTIES The following table provides certain information about our office properties as of December 31, 1999:
Total Rental Percentage Percentage Revenue per Year Occupied Total of Total Occupied Built/ Rentable as of Rental Rental Square Feet Major Tenants Property Location Renovated Square Feet 12/31/99(1) Revenue(2) Revenue (3) (4) (10% or more Rentable Sq. Ft.) - ------------------------------------------------------------------------------------------------------------------------------------ BALTIMORE/WASHINGTON CORRIDOR: ANNAPOLIS JUNCTION, MD 2730 Hercules Road 1990 240,336 100.00% $4,604,196 4.98% $19.16 U.S. Department of Defense (100%) 134 National Business Pkwy 1999 93,482 100.00% 1,834,249 1.98% 19.62 Booz Allen Hamilton (74%) Ameritrade Holding Corporation (26%) 133 National Business Pkwy 1997 88,666 100.00% 1,737,667 1.87% 19.60 e.spire Communications (67%) Applied Signal Technology (33%) 141 National Business Pkwy 1990 86,964 98.42% 1,508,830 1.63% 17.63 ITT Industries (46%) J.G. Van Dyke & Associates (20%) Harris Data Services Corp (14%) 135 National Business Pkwy 1998 86,863 95.41% 1,566,286 1.69% 18.90 Credit Management Solutions (82%) 131 National Business Pkwy 1990 68,906 98.26% 1,275,170 1.38% 18.83 TASC (36%) e.spire Communications (35%) U.S. Department of Defense (15%) Intel Corporation (12%) LINTHICUM, MD 1306 Concourse Drive 1990 113,831 97.46% 2,218,864 2.39% 20.00 PricewaterhouseCoopers (33%) AT&T Local Services (26%) Quest Communications (13%) 900 Elkridge Landing Road 1982 97,139 100.00% 1,682,665 1.81% 17.32 First Annapolis Consulting (51%) Booz Allen Hamilton (38%) 1199 Winterson Road 1988 96,636 100.00% 1,534,245 1.65% 15.88 U.S. Department of Defense (100%) 1302 Concourse Drive 1996 84,607 86.41% 1,422,386 1.53% 19.46 AETNA US Healthcare (20%) Lucent Technologies (19%) 881 Elkridge Landing Road 1986 73,572 100.00% 866,280 0.93% 11.77 U.S. Department of Defense (100%) 1099 Winterson Road 1988 70,569 100.00% 1,139,244 1.23% 16.14 Preferred Health Network (63%) 1190 Winterson Road 1987 68,567 100.00% 1,148,775 1.24% 16.75 Chesapeake Appraisal (58%) U.S. Department of Defense (15%) Motorola (14%) 849 International Drive 1988 67,976 98.41% 1,158,983 1.25% 17.33 EMC Corporation (13%) Coca Cola Bottling (11%) U.S. Department of Defense (11%) 1201 Winterson Road 1985 67,903 100.00% 684,107 0.74% 10.07 Ciena Corporation (100%) 911 Elkridge Landing Road 1985 67,806 100.00% 1,104,649 1.19% 16.29 U.S. Department of Defense (79%) Nationwide Mutual Insurance (21%) 930 International Drive 1986 57,140 100.00% 626,072 0.68% 10.96 Ciena Corporation (100%) 900 International Drive 1986 57,140 100.00% 632,398 0.68% 11.07 Ciena Corporation (100%) 921 Elkridge Landing Road 1983 54,057 100.00% 861,935 0.93% 15.94 Aerotek (100%) 939 Elkridge Landing Road 1983 51,953 100.00% 796,952 0.86% 15.34 Agency Holding (68%) U.S. Department of Defense (24%) 800 International Drive 1988 50,612 100.00% 736,150 0.79% 14.54 Ciena Corporation (100%) COLUMBIA, MD 7200 Riverwood Drive 1986 160,000 100.00% 2,770,640 2.99% 17.32 U.S. Department of Defense (100%) 6940 Columbia Gateway Drive 1999 108,737 60.51% 1,428,314 1.54% 21.71 Magellan Behavioral Health (26%) Remedy Corporation (14%) Reliance Insurance (13%) 6950 Columbia Gateway Drive 1998 107,778 100.00% 2,214,159 2.39% 20.54 Magellan Behavioral Health (100%) 6740 Alexander Bell Drive 1989/1992 59,569 100.00% 1,355,651 1.46% 22.76 Johns Hopkins University (70%) Amtel Corporation (16%) Sky Alland Research (13%) 8815 Centre Park Drive 1987 53,635 100.00% 1,079,595 1.16% 20.13 Corporate Office Management (25%)
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Total Rental Percentage Percentage Revenue per Year Occupied Total of Total Occupied Built/ Rentable as of Rental Rental Square Feet Major Tenants Property Location Renovated Square Feet 12/31/99(1) Revenue(2) Revenue (3) (4) (10% or more Rentable Sq. Ft.) - ------------------------------------------------------------------------------------------------------------------------------------ Lipman, Frizzel & Mitchell (16%) Reap/REMAX (16%) Corporate Realty Management, LLC(13%) H.C. Copeland Associates (10%) 6716 Alexander Bell Drive 1989/1992 51,980 91.18% 827,504 0.89% 17.46 Sun Microsystems (87%) 6760 Alexander Bell Drive 1989/1992 37,248 100.00% 713,441 0.77% 19.15 Cadence Design Systems (65%) HANOVER, MD 7467 Ridge Road 1990 73,773 100.00% 1,532,909 1.65% 20.78 Travelers Casualty and Surety (55%) 7318 Parkway Drive 1984 59,204 100.00% 632,627 0.68% 10.69 U.S. Department of Defense (100%) 1340 Ashton Road 1989 46,400 100.00% 595,351 0.64% 12.83 Lockheed Martin Corporation (100%) 7321 Parkway Drive 1984 39,822 100.00% 657,063 0.71% 16.50 U.S. Department of Defense (100%) 1334 Ashton Road 1989 37,565 96.77% 557,687 0.60% 15.34 Science Applications International Corp. (60%) Merrill Corporation (37%) 1331 Ashton Road 1989 29,936 100.00% 388,490 0.42% 12.98 Booz Allen Hamilton (71%) Aerosol Monitoring (29%) 1350 Dorsey Road 1989 20,021 90.16% 253,713 0.27% 14.06 Aerotek (23%) Noodles (14%) Hunan Pagoda (12%) Electronic System (11%) 1344 Ashton Road 1989 16,865 100.00% 334,004 0.36% 19.80 Titan Systems (28%) Student Travel Services (23%) AMP Corporation (16%) Jani - King of Baltimore (14%) Citizens National Bank (12%) 1341 Ashton Road 1989 15,825 70.87% 114,484 0.12% 10.21 Supertots Childcare (71%) 1343 Ashton Road 1989 9,962 100.00% 120,753 0.13% 12.12 Nauticus Corporation (100%) Pepsi-Cola Bottling (17%) LAUREL, MD 14502 Greenview Drive 1988 71,873 100.00% 1,239,028 1.34% 17.24 Sky Alland Research (26%) Greenman-Pedersen (15%) 14504 Greenview Drive 1985 69,194 88.39% 1,058,220 1.14% 17.30 Great West Life & Annuity (17%) Laurel Consulting Group (16%) Moore USA (11%) TIMONIUM, MD 375 W. Padonia Road 1986 100,804 100.00% 1,579,559 1.70% 15.67 Deutsche Bank Alex. Brown (84%) 9690 Deerco Road 1988 132,819 91.10% 2,483,260 2.68% 20.52 Fireman's Fund Insurance (22%) AirTouch Paging of Virginia (12%) OXON HILL, MD 6009-6011 Oxon Hill Road 1990 181,236 100.00% 3,497,148 3.78% 19.30 U.S. Department of Treasury (47%) Constellation Real Estate (22%) BALTIMORE, MD 1615 - 1629 Thames Street 1989 103,670 100.00% 1,655,549 1.79% 15.97 Johns Hopkins University (37%) --------- --------- ----------- ------- ------- Lista's (14%) Total Baltimore/Washington Corridor 3,332,641 97.08% $56,229,252 60.64% $17.38 --------- --------- ----------- ------- ------- Greater Philadelphia: BLUE BELL, PA 753 Jolly Road 1960/92-94 419,472 100.00% $3,572,761 3.85% $ 8.52 Unisys (100%) 785 Jolly Road 1970/1996 219,065 100.00% 2,618,611 2.82% 11.95 Unisys with 100% sublease to Merck 760 Jolly Road 1974/1994 208,854 100.00% 2,150,891 2.32% 10.30 Unisys (100%) 751 Jolly Road 1960/92-94 112,958 100.00% 962,095 1.04% 8.52 Unisys (100%) --------- --------- ----------- ------- ------- Total Greater Philadelphia 960,349 100.00% $9,304,358 10.03% $ 9.69 --------- --------- ----------- ------- -------
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Total Rental Percentage Percentage Revenue per Year Occupied Total of Total Occupied Built/ Rentable as of Rental Rental Square Feet Major Tenants Property Location Renovated Square Feet 12/31/99(1) Revenue(2) Revenue (3) (4) (10% or more Rentable Sq. Ft.) - ------------------------------------------------------------------------------------------------------------------------------------ GREATER HARRISBURG: HARRISBURG, PA 2605 Interstate Drive 1990 84,268 100.00% $1,200,468 1.30% $14.25 Commonwealth of Pennsylvania (56%) Health Central (32%) 6345 Flank Drive 1989 69,443 100.00% 905,718 0.99% 13.04 Allstate Insurance (30%) First Health Services (24%) LWN Enterprises (15%) Coventry Health Care (13%) 6340 Flank Drive 1988 68,200 100.00% 690,578 0.74% 10.13 Lancaster Lebanon (73%) Merkert Enterprises (27%) 2601 Market Place 1989 67,753 100.00% 1,190,262 1.28% 17.57 Penn State Geisinger Systems (36%) Ernst & Young LLP (26%) Texas Eastern Pipeline Company (26%) 5035 Ritter Road 1988 56,556 100.00% 710,352 0.77% 12.56 Commonwealth of Pennsylvania (82%) 6400 Flank Drive 1992 52,439 100.00% 743,503 0.80% 14.18 PA Coalition Against Violence (51%) REM Organization (27%) Mellon Bank (16%) 6360 Flank Drive 1988 46,500 100.00% 634,091 0.68% 13.64 Ikon Office Solutions (20%) Health Spectrum Medical (15%) Sentage / Muth & Mumma (15%) Computer Applications (15%) First Industrial Realty Trust (12%) 6385 Flank Drive 1995 32,800 100.00% 421,094 0.45% 12.84 Cowles Enthusiast Media (34%) Orion Capital Companies (26%) Pitney Bowes (21%) Orion Consulting (11%) 5070 Ritter Road - Building A 1989 32,000 100.00% 466,700 0.50% 14.58 Maryland Casualty Company (100%) 6405 Flank Drive 1991 32,000 100.00% 433,156 0.47% 13.54 Cowles Enthusiast Media (100%) 6380 Flank Drive 1991 32,000 87.50% 388,691 0.42% 13.88 McCormick, Taylor & Associates (21%) Myers & Stauffer (17%) Critical Care System (13%) SV Research (12%) 5070 Ritter Road - Coram (10%) Building B 1989 28,000 81.09% 258,284 0.28% 11.38 Vale National Training Center (63%) Pennsylvania Trauma System Foundation (18%) 95 Shannon Road 1999 21,976 100.00% 282,071 0.30% 12.84 New World Pasta (100%) 75 Shannon Road 1999 20,887 81.45% 222,609 0.24% 13.09 McCormick, Taylor & Associates (81%) 85 Shannon Road 1999 12,863 100.00% 165,102 0.18% 12.84 New World Pasta (100%) --------- --------- ----------- ------- ------- Total Greater Harrisburg 657,685 98.00% $8,712,679 9.40% $13.52 --------- --------- ----------- ------- ------- Northern/Central New Jersey: SOUTH BRUNSICK, NJ 431 Ridge Road 1958/1998 170,000 100.00% $3,369,678 3.64% $19.82 IBM with 84% sublease to AT&T Local 429 Ridge Road 1966/1996 142,385 100.00% 2,762,313 2.98% 19.40 AT&T Local Services (100%) 437 Ridge Road 1962/1996 30,000 100.00% 559,344 0.60% 18.64 IBM with 100% sublease to AT&T Local (100%) CRANBURY, NJ 19 Commerce 1989 65,277 100.00% 1,304,572 1.41% 19.99 The Associated Press (100%) 104 Interchange Plaza 1990 47,142 100.00% 1,046,886 1.13% 22.21 Turner Construction Company (24%) Utica Mutual Insurance Company (15%) Laborer's International Union (13%) Lanier Worldwide (12%) Somerset Real Estate Management (10%) 101 Interchange Plaza 1985 44,185 87.47% 874,400 0.94% 22.63 Ford Motor Credit Company (21%) Arquest (16%) Middlesex County Improvement Authority
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Total Rental Percentage Percentage Revenue per Year Occupied Total of Total Occupied Built/ Rentable as of Rental Rental Square Feet Major Tenants Property Location Renovated Square Feet 12/31/99(1) Revenue(2) Revenue (3) (4) (10% or more Rentable Sq. Ft.) - ------------------------------------------------------------------------------------------------------------------------------------ (13%) Trans Union Corporation (11%) 47 Commerce 1992/1998 41,398 100.00% 483,603 0.52% 11.68 Somfy Systems (100%) 3 Centre Drive 1987 20,436 100.00% 372,219 0.40% 18.21 Matrix Development Group (100%) 7 Centre Drive 1989 19,466 100.00% 401,020 0.43% 20.60 Paradise Software (22%) System Freight (17%) Compugen (12%) 8 Centre Drive 1986 16,199 100.00% 348,249 0.38% 21.50 AON Risk Services (100%) 2 Centre Drive 1989 16,132 100.00% 418,438 0.45% 25.94 Summit Bancorp (100%) FAIRFIELD, NJ 695 Route 46 1990 158,348 83.59% 2,528,021 2.73% 19.10 Pearson (22%) United Healthcare Services (15%) The Museum Company (12%) Dean Witter Reynolds (12%) 710 Route 46 1985 101,791 94.28% 1,745,021 1.88% 18.18 Midsco (19%) Radian International, LLC (12%) Continental Casualty (12%) Lincoln Financial Group (11%) MONMOUTH, NJ 4301 Route 1 1986 61,300 100.00% 1,176,212 1.27% 19.19 Guest Supply (38%) ---------- --------- ----------- ------- ------- eCOM Server (16%) Ikon Office Solutions (16%) Total Northern/Central New Jersey 934,059 96.00% $17,389,976 18.76% $19.39 ---------- --------- ----------- ------- ------- TOTAL OFFICE PROPERTIES 5,884,734 97.49% $91,636,265 98.83% $15.97 ---------- --------- ----------- ------- -------
(1) This percentage is based upon all occupied space as of December 31, 1999. (2) Total rental revenue is the monthly contractual base rent as of December 31, 1999 multiplied by 12 plus the estimated annualized expense reimbursements under existing leases. (3) This percentage represents the individual property's rental revenue to our total rental revenue as of December 31, 1999. (4) This total rent per occupied square foot is the property's total rental revenue divided by that property's occupied square feet as of December 31, 1999. The following table provides certain information about our retail properties as of December 31, 1999:
Total Rental Year Rentable Percentage Percentage of Revenue per Built/ Square Occupied as Total Rental Total Rental Occupied Major Tenants Property Location Renovated Feet of 12/31/99(1) Revenue(2) Revenue (3) Square Feet (4) (10% or more Rentable Sq. Ft.) - ------------------------------------------------------------------------------------------------------------------------------------ EASTON, MD 322 Marlboro Street 1977/1997 145,203 95.69% $771,626 0.83% $5.55 Acme Markets (34%) Peebles (24%) MINOT, ND 2100 S. Broadway 1993 46,134 100.00% 312,211 0.34% 6.77 Nash-Finch Company (100%) --------- ------- ----------- ------- ------- TOTAL RETAIL PROPERTIES 191,337 96.73% $1,083,837 1.17% $5.86 --------- ------- ----------- ------- ------- GRAND TOTAL 6,076,071 $92,720,102 100.00% ========= =========== =======
(1) This percentage is based upon all leases signed and tenants occupying as of December 31, 1999. (2) Total rental revenue is the monthly contractual base rent as of December 31, 1999 multiplied by 12 plus the estimated annualized expense reimbursements under existing leases. (3) This percentage represents the individual property's rental revenue to our total rental revenue as of December 31, 1999. (4) This total rent per occupied square foot is the property's total rental revenue divided by that property's occupied square feet as of December 31, 1999. 12 The following table provides a summary schedule of the lease expirations for leases in place as of December 31, 1999, assuming that none of the tenants exercise renewal options (dollars in thousands, except per square foot amounts): OFFICE AND RETAIL LEASE EXPIRATION ANALYSIS BY YEAR
Percentage Total Rental Square (1) of Total Revenue of Number Footage Percentage of Total Rental Rental Expiring Leases Year of of Leases of Leases Total Occupied Revenue of Revenue per Occupied Expiration (2) Expiring Expiring Square Feet Expiring Leases Expiring Square Foot - -------------------------------------------------------------------------------------------------------------------------- 2000 106 772,476 13.0% $13,576 14.64% $17.57 2001 70 589,401 10.0% 8,687 9.37% 14.74 2002 76 888,996 15.0% 14,292 15.41% 16.08 2003 69 763,862 12.9% 13,490 14.55% 17.66 2004 53 577,316 9.7% 10,374 11.19% 17.97 2005 10 154,483 2.6% 2,640 2.85% 17.09 2006 6 199,118 3.4% 3,122 3.37% 15.68 2007 6 171,499 2.9% 2,516 2.71% 14.67 2008 11 569,186 9.6% 10,633 11.47% 18.68 2009 11 1,189,625 20.1% 13,078 14.10% 10.99 2010 0 -- 0.0% -- 0.00% 0.00 2011 0 -- 0.0% -- 0.00% 0.00 2012 0 -- 0.0% -- 0.00% 0.00 2013 0 -- 0.0% -- 0.00% 0.00 2014 1 46,134 0.8% 312 0.34% 6.77 ------- --------- -------- -------- -------- Total/Weighted Avg. 419 5,922,096 100.0% $92,720 100.00% $16.14 ======= ========= ======== ======== ========
(1) Total rental revenue is the monthly contractual base rent as of December 31, 1999 multiplied by 12 plus the estimated annualized expense reimbursements under existing leases. (2) Many of our government leases are subject to certain early termination provisions which are customary to government leases. The year of lease expiration was computed assuming no exercise of such early terminations. ITEM 3. LEGAL PROCEEDINGS We are not currently involved in any material litigation nor, to our knowledge, is any material litigation currently threatened against the Company (other than routine litigation arising in the ordinary course of business, substantially all of which is expected to be covered by liability insurance). ITEM 4. SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS No matters were submitted to a vote of our security holders during the fourth quarter of 1999. 13 PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS Information for this item is incorporated herein by reference to the section of Exhibit 13.1 entitled "Market for Registrant's Common Equity and Related Shareholder Matters". On December 21, 1999, we issued 974,662 Series C Preferred Units in our Operating Partnership in connection with a property acquisition. The issuance of these units is exempt from registration under Section 4 (2) of the Securities Act of 1933, as amended. These units are convertible, subject to certain restrictions, commencing December 21, 2000 into Common Units in the Operating Partnership on the basis of 2.381 Common Units for each Series C Preferred Unit, plus any accrued return. The Common Units would then be exchangeable for Common Shares, subject to certain conditions. ITEM 6. SELECTED FINANCIAL DATA Information for this item is incorporated herein by reference to the section of Exhibit 13.1 to this Form 10-K entitled "Selected Financial Data". ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Information for this item is incorporated herein by reference to the section of Exhibit 13.1 to this Form 10-K entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations". ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Information for this section is incorporated herein by reference to the section of Exhibit 13.1 to this Form 10-K entitled "Quantitative and Qualitative Disclosures about Market Risk". ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Information for this section is incorporated herein by reference to the Section of Exhibit 13.1 to this Form 10-K beginning on Page 13. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. PART III ITEM 10, 11, 12 & 13. TRUSTEES AND EXECUTIVE OFFICERS OF THE REGISTRANT, EXECUTIVE COMPENSATION, SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS For the information required by Item 10, Item 11, Item 12 and Item 13, you should refer to our definitive proxy statement relating to the 2000 Annual Meeting of our Shareholders to be filed with the Securities and Exchange Commission no later than 120 days after the end of the fiscal year covered by this Form 10-K. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K (a) The following documents are filed as exhibits to this Form 10-K: 14 1. FINANCIAL STATEMENTS. Audited consolidated balance sheets as of December 31, 1999 and 1998, and the related consolidated statements of operations, of shareholders' equity, and of cash flows for each of the three years in the period ended December 31, 1999 are included in Exhibit 13.1 to this Form 10-K and are incorporated by reference. 2. FINANCIAL STATEMENT SCHEDULE. Audited Schedule III - Real Estate and Accumulated Depreciation is included in Exhibit 13.2 to this Form 10-K and is incorporated by reference. (b) We filed no Current Reports on Form 8-K in the last quarter of the year ended December 31, 1999. (c) EXHIBITS. Refer to the Exhibit Index that follows.
EXHIBIT NO. DESCRIPTION ------------- ---------------------------------------------------------- 2.1 Agreement and Plan of Merger, dated January 31, 1998, among the Registrant, the Maryland Company and the Company (filed with the Trust's Registration Statement on Form S-4 (Commission File No. 333-45649) and incorporated herein by reference). 2.2 Assignment of Partnership Interests, dated April 30, 1998, between Airport Square Limited Partnership, Airport Square Corporation, Camp Meade Corporation and COPT Airport Square One LLC and COPT Airport Square Two LLC. (filed with the Company's Current Report on Form 8-K on May 14, 1998 and incorporated herein by reference). 2.3 Assignment of Purchase and Sale Agreement, dated April 30, 1998, between Aetna Life Insurance Company and the Operating Partnership. (filed with the Company's Current Report on Form 8-K on May 14, 1998 and incorporated herein by reference). 2.4 Assignment of Loan Purchase and Sale Agreement, dated April 30, 1998, between Constellation Real Estate, Inc. and the Operating Partnership. (filed with the Company's Current Report on Form 8-K on May 14, 1998 and incorporated herein by reference). 2.5 Purchase and Sale Agreement, dated April 1, 1998, between Aetna Life Insurance Company and Airport Square Limited Partnership (filed with the Company's Current Report on Form 8-K on May 14, 1998 and incorporated herein by reference). 2.6.1 Loan Purchase and Sale Agreement, dated March 13, 1998, between Aetna Life Insurance Company and Constellation Real Estate, Inc. (filed with the Company's Current Report on Form 8-K on May 14, 1998 and incorporated herein by reference). 2.6.2 Amendment to Loan Purchase and Sale Agreement, dated April 16, 1998, between Aetna Life Insurance Company and Constellation Real Estate, Inc. (filed with the Company's Current Report on Form 8-K on May 14, 1998 and incorporated herein by reference). 2.7.1 Purchase and Sale Agreement, dated March 4, 1998, between 695 Rt. 46 Realty, LLC, 710 Rt. 46 Realty, LLC and COPT Acquisitions, Inc. (filed with the Company's Current Report on Form 8-K on June 10, 1998 and incorporated herein by reference). 2.7.2 Letter Amendment to Purchase and Sale Agreement, dated March 26, 1998, between 695 Rt. 46 Realty, LLC, 710 Rt. 46 Realty, LLC and COPT Acquisitions, Inc. (filed with the Company's Current Report on Form 8-K on June 10, 1998 and incorporated herein by reference). 2.8.1 Contribution Agreement between the Company and the Operating Partnership and certain Constellation affiliates (filed as Exhibit A of the Company's Schedule 14A Information on
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EXHIBIT NO. DESCRIPTION ------------- ---------------------------------------------------------- June 26, 1998 and incorporated herein by reference). 2.8.2 First Amendment to Contribution Agreement, dated July 16, 1998, between Constellation Properties, Inc. and certain entities controlled by Constellation Properties, Inc. (filed with the Company's Current Report on Form 8-K on October 13, 1998 and incorporated herein by reference). 2.8.3 Second Amendment to Contribution Agreement, dated September 28, 1998, between Constellation Properties, Inc. and certain entities controlled by Constellation Properties, Inc. (filed with the Company's Current Report on Form 8-K on October 13, 1998 and incorporated herein by reference). 2.9 Service Company Asset Contribution Agreement between the Company and the Operating Partnership and certain Constellation affiliates (filed as Exhibit B of the Company's Schedule 14A Information on June 26, 1998 and incorporated herein by reference). 2.10.1 Option Agreement, dated May 14, 1998, between the Operating Partnership and NBP-III, LLC (a Constellation affiliate) (filed as Exhibit C of the Company's Schedule 14A Information on June 26, 1998 and incorporated herein by reference). 2.10.2 First Amendment to Option Agreement, dated June 22, 1998, between the Operating Partnership and NBP-III, LLC (a Constellation affiliate) (filed as Exhibit E of the Company's Schedule 14A Information on June 26, 1998 and incorporated herein by reference). 2.11.1 Option Agreement, dated May 14, 1998, between the Operating Partnership and Constellation Gatespring II, LLC (a Constellation affiliate) (filed as Exhibit D of the Company's Schedule 14A Information on June 26, 1998 and incorporated herein by reference). 2.11.2 First Amendment to Option Agreement, dated June 22, 1998, between the Operating Partnership and Constellation Gatespring II, LLC (a Constellation affiliate) (filed as Exhibit F of the Company's Schedule 14A Information on June 26, 1998 and incorporated herein by reference). 2.12 Option Agreement, dated September 28, 1998, between Jolly Acres Limited Partnership, Arbitrage Land Limited Partnership and the Operating Partnership (filed with the Company's Current Report on Form 8-K on October 13, 1998 and incorporated herein by reference). 2.13 Right of First Refusal Agreement, dated September 28, 1998, between Constellation Properties, Inc. and the Operating Partnership (filed with the Company's Current Report on Form 8-K on October 13, 1998 and incorporated herein by reference). 2.14 Right of First Refusal Agreement, dated September 28, 1998, between 257 Oxon, LLC and the Operating Partnership (filed with the Company's Current Report on Form 8-K on October 13, 1998 and incorporated herein by reference). 2.15 Contribution Agreement, dated September 30, 1998, between COPT Acquisitions, Inc. and M.O.R. XXIX Associates Limited Partnership (filed with the Company's Current Report on Form 8-K on October 28, 1998 and incorporated herein by reference).
16
EXHIBIT NO. DESCRIPTION ------------- ---------------------------------------------------------- 2.16 Purchase and Sale Agreement, dated September 30, 1998, between New England Life Pension Properties II: A Real Estate Limited Partnership and COPT Acquisitions, Inc. (filed with the Company's Current Report on Form 8-K on October 28, 1998 and incorporated herein by reference). 2.17.1 Sale-Purchase Agreement, dated August 20, 1998 between South Middlesex Industrial Park Associates, L.P. and SM Monroe Associates and COPT Acquisitions, Inc. (filed with the Company's Current Report on Form 8-K on October 28, 1998 and incorporated herein by reference). 2.17.2 First Amendment to Sale-Purchase Agreement, dated October 30, 1998, between South Middlesex Industrial Park Associates, L.P. and SM Monroe Associates, L.P. and COPT Acquisitions, Inc. (filed with the Company's Current Report on Form 8-K on November 16, 1998 and incorporated herein by reference). 2.18 Contribution Agreement, dated December 31, 1998, between the Operating Partnership and M.O.R. 44 Gateway Associates L.P., RA & DM, Inc. and M.R.U. L.P. (filed with the Company's Current Report on Form 8-K on January 14, 1999 and incorporated herein by reference). 2.19.1 Purchase and Sale Agreement, dated December 31, 1998, between Metropolitan Life Insurance Company and Corporate Office Acquisitions, Inc. (filed with the Company's Current Report on Form 8-K on January 14, 1999 and incorporated herein by reference). 2.19.2 Amendment to Purchase and Sale Agreement, dated December 31, 1998, between Metropolitan Life Insurance Company, DPA/Gateway L.P., Corporate Office Acquisitions, Inc., COPT Gateway, LLC and the Operating Partnership (filed with the Company's Current Report on Form 8-K on January 14, 1999 and incorporated herein by reference). 2.20 Contribution Agreement, dated February 24, 1999, between the Operating Partnership and John Parsinen, John D. Parsinen, Jr., Enterprise Nautical, Inc. and Vernon Beck (filed with the Company's Quarterly Report on Form 10-Q on May 14, 1999 and incorporated herein by reference). 2.21 Agreement to Sell Partnership Interests, dated August 12, 1999, between Gateway Shannon Development Corporation, Clay W. Hamlin, III and COPT Acquisitions, Inc. (filed with the Company's Quarterly Report on Form 10-Q on November 8, 1999 and incorporated herein by reference). 2.22 Agreement of Purchase and Sale, dated July 21, 1999, between First Industrial Financing Partnership, L.P. and COPT Acquisitions, Inc. (filed with the Company's Quarterly Report on Form 10-Q on November 8, 1999 and incorporated herein by reference). 2.23 Contribution Agreement, dated December 21, 1999, between United Properties Group, Incorporated and COPT Acquisitions, Inc. 3.1 Amended and Restated Declaration of Trust of Registrant (filed with the Registrant's Registration Statement on Form S-4 (Commission File No. 333-45649) and incorporated herein by reference). 3.2 Bylaws of Registrant (filed with the Registrant's Registration Statement on Form S-4
17
EXHIBIT NO. DESCRIPTION ------------- ---------------------------------------------------------- (Commission File No. 333-45649) and incorporated herein by reference). 4.1 Form of certificate for the Registrant's Common Shares of Beneficial Interest, $0.01 par value per share (filed with the Registrant's Registration Statement on Form S-4 (Commission File No. 333-45649) and incorporated herein by reference). 4.2 Amended and Restated Registration Rights Agreement, dated March 16, 1998, for the benefit of certain shareholders of the Company (filed with the Company's Quarterly Report on Form 10-Q on August 12, 1998 and incorporated herein by reference). 4.3 Articles Supplementary of Corporate Office Properties Trust Series A Convertible Preferred Shares, dated September 28, 1998 (filed with the Company's Current Report on Form 8-K on October 13, 1998 and incorporated herein by reference). 4.4.1 Second Amended and Restated Limited Partnership Agreement of the Operating Partnership, dated December 7, 1999. 4.4.2 First Amendment to Second Amended and Restated Limited Partnership Agreement of the Operating Partnership, dated December 21, 1999. 4.5 Articles Supplementary of Corporate Office Properties Trust Series B Convertible Preferred Shares, dated July 2, 1999 (filed with the Company's Current Report on Form 8-K on July 7, 1999 and incorporated herein by reference). 10.1 Employment Agreement, dated December 16, 1999, between Corporate Office Management, Inc., COPT and Clay W. Hamlin, III. 10.2 Employment Agreement, dated December 16, 1999, between Corporate Office Management, Inc., COPT and Randall M. Griffin. 10.3 Employment Agreement, dated December 16, 1999, between Corporate Office Management, Inc., COPT and Roger A. Waesche, Jr. 10.4 Employment Agreement, dated December 16, 1999, between Corporate Development Services, LLC, COPT and Dwight Taylor. 10.5 Employment Agreement, dated December 16, 1999, between Corporate Realty Management, LLC, COPT and Michael D. Kaiser. 10.6 Restricted Share Agreement, dated December 16, 1999, between Corporate Office Properties Trust and Randall M. Griffin. 10.7 Restricted Share Agreement, dated December 16, 1999, between Corporate Office Properties Trust and Roger A. Waesche, Jr. 10.8 Restricted Share Agreement, dated December 16, 1999, between Corporate Office Properties Trust and Dwight Taylor. 10.9 Restricted Share Agreement, dated December 16, 1999, between Corporate Office Properties Trust and Michael D. Kaiser.
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EXHIBIT NO. DESCRIPTION ------------- ---------------------------------------------------------- 10.10 Management agreement between Registrant and Glacier Realty, LLC (filed with the Company's Current Report on Form 8-K on October 29, 1997, and incorporated herein by reference). 10.11 Senior Secured Credit Agreement, dated October 13, 1997, (filed with the Company's Current Report on Form 8-K on October 29, 1997, and incorporated herein by reference). 10.12.1 Corporate Office Properties Trust 1998 Long Term Incentive Plan (filed with the Registrant's Registration Statement on Form S-4 (Commission File No. 333-45649) and incorporated herein by reference). 10.12.2 Amendment No. 1 to Corporate Office Properties Trust 1998 Long Term Incentive Plan (filed with the Company's Quarterly Report on Form 10-Q on August 13, 1999 and incorporated herein by reference). 10.13 Stock Option Plan for Directors (filed with Royale Investments, Inc.'s Form 10-KSB for the year ended December 31, 1993 (Commission File No. 0-20047) and incorporated herein 10.14 Lease Agreement between Blue Bell Investment Company, L.P. and Unisys Corporation dated March 12, 1997 with respect to lot A (filed with the Registrant's Registration Statement on Form S-4 (Commission File No. 333-45649) and incorporated herein by reference). 10.15 Lease Agreement between Blue Bell Investment Company, L.P. and Unisys Corporation, dated March 12, 1997, with respect to lot B (filed with the Registrant's Registration Statement on Form S-4 (Commission File No. 333-45649) and incorporated herein by reference). 10.16 Lease Agreement between Blue Bell Investment Company, L.P. and Unisys Corporation, dated March 12, 1997, with respect to lot C (filed with the Registrant's Registration Statement on Form S-4 (Commission File No. 333-45649) and incorporated herein by reference). 10.17 Senior Secured Revolving Credit Agreement, dated May 28, 1998, between the Company, the Operating Partnership, Any Mortgaged Property Subsidiary and Bankers Trust Company (filed with the Company's Current Report on Form 8-K on June 10, 1998 and incorporated herein by reference). 10.18 Consulting Services Agreement, dated April 28, 1998, between the Company and Net Lease Finance Corp., doing business as Corporate Office Services (filed with the Company's Current Report on Form 8-K on October 13, 1998 and incorporated herein by reference). 10.19 Project Consulting and Management Agreement, dated September 28, 1998, between Constellation Properties, Inc. and COMI (filed with the Company's Current Report on Form 8-K on October 13, 1998 and incorporated herein by reference). 10.20 Promissory Note, dated October 22, 1998, between Teachers Insurance and Annuity Association of America and the Operating Partnership (filed with the Company's Quarterly Report on Form 10-Q on November 13, 1998 and incorporated herein by reference).
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EXHIBIT NO. DESCRIPTION ------------- ---------------------------------------------------------- 10.21 Indemnity Deed of Trust, Assignment of Leases and Rents and Security Agreement, dated October 22, 1998, by affiliates of the Operating Partnership for the benefit of Teachers Insurance and Annuity Association of America (filed with the Company's Quarterly Report on Form 10-Q on November 13, 1998 and incorporated herein by reference). 10.22 Agreement for Services, dated September 28, 1998, between the Company and Corporate Office Management, Inc. (filed with the Company's Quarterly Report on Form 10-Q on May 14, 1999 and incorporated herein by reference). 10.23.1 Lease Agreement, dated September 28,1998, between St. Barnabas Limited Partnership and Constellation Properties, Inc. (filed with the Company's Quarterly Report on Form 10-Q on May 14, 1999 and incorporated herein by reference). 10.23.2 First Amendment to Lease, dated December 31, 1998, between St. Barnabas, LLC and Constellation Properties, Inc. (filed with the Company's Quarterly Report on Form 10-Q on May 14, 1999 and incorporated herein by reference). 10.24.1 Lease Agreement, dated August 3, 1998, between Constellation Real Estate, Inc. and Constellation Properties, Inc. (filed with the Company's Quarterly Report on Form 10-Q on May 14, 1999 and incorporated herein by reference). 10.24.2 First Amendment to Lease, dated December 30, 1998, between Three Centre Park, LLC and Constellation Properties, Inc. (filed with the Company's Quarterly Report on Form 10-Q on May 14, 1999 and incorporated herein by reference). 10.25.1 Lease Agreement, dated April 27, 1993, between Constellation Properties, Inc. and Baltimore Gas and Electric Company (filed with the Company's Quarterly Report on Form 10-Q on May 14, 1999 and incorporated herein by reference). 10.25.2 First Amendment to Lease, dated December 9, 1998, between COPT Brandon, LLC and Baltimore Gas and Electric Company (filed with the Company's Quarterly Report on Form 10-Q on May 14, 1999 and incorporated herein by reference). 10.26 Underwriting Agreement, dated June 29, 1999, between Corporate Office Properties Trust and the underwriters of the Series B Preferred Shares (filed with the Company's Current Report on Form 8-K on July 7, 1999 and incorporated herein by reference). 10.27 Contribution Rights Agreement, dated June 23, 1999, between the Operating Partnership and United Properties Group, Incorporated (filed with the Company's Quarterly Report on Form 10-Q on August 13, 1999 and incorporated herein by reference). 10.28 Promissory Note, dated September 30, 1999, between Teachers Insurance and Annuity Association of America and the Operating Partnership (filed with the Company's Quarterly Report on Form 10-Q on November 8, 1999 and incorporated herein by reference). 10.29 Indemnity Deed of Trust, Assignment of Leases and Rents and Security Agreement, dated September 30, 1999, by affiliates of the Operating Partnership for the benefit of Teachers Insurance and Annuity Association of America (filed with the Company's Quarterly Report on Form 10-Q on November 8, 1999 and incorporated herein by reference).
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EXHIBIT NO. DESCRIPTION ------------- ---------------------------------------------------------- 10.30 Revolving Credit Agreement, dated December 29, 1999, between Corporate Office Properties, L.P. and Prudential Securities Credit Corp. 10.31 Option agreement, dated March 1998, between Corporate Office Properties, L.P. and Blue Bell Land, L.P. 10.32 Option agreement, dated March 1998, between Corporate Office Properties, L.P. and Comcourt Land, L.P. 13.1 Portions of the Annual Report of Corporate Office Properties Trust as of and for the year ended December 31, 1999. 13.2 Schedule III - Real Estate and Accumulated Depreciation as of December 31, 1999. 21.1 Subsidiaries of Registrant. 23.1 Consent of Independent Accountants. 27 Financial Data Schedule.
SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CORPORATE OFFICE PROPERTIES TRUST Date: March 16, 2000 By: /s/ Randall M. Griffin ------------------------------------------ Randall M. Griffin President and Chief Operating Officer Date: March 16, 2000 By: /s/ Roger A. Waesche, Jr. ------------------------------------------ Roger A. Waesche, Jr. Senior Vice President and Chief Financial Officer 21 Pursuant to the requirements of the Securities Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated:
Signatures Title Date ---------- ----- ---- /s/ Jay H. Shidler Chairman of the Board March 16, 2000 ------------------------------- (Jay H. Shidler) and Trustee /s/ Clay W. Hamlin, III Chief Executive Officer and March 16, 2000 ------------------------------- (Clay W. Hamlin, III) Trustee /s/ Randall M. Griffin President and Chief Operating March 16, 2000 ------------------------------- (Randall M. Griffin) Officer /s/ Roger A. Waesche, Jr. Senior Vice President and Chief March 16, 2000 ------------------------------- (Roger A. Waesche) Financial Officer /s/ Betsy Z. Cohen Trustee March 16, 2000 ------------------------------- (Betzy Z. Cohen) /s/ Kenneth D. Wethe Trustee March 16, 2000 ------------------------------- (Kenneth D. Wethe) /s/ Robert L. Denton Trustee March 16, 2000 ------------------------------- (Robert L. Denton) /s/ William H. Walton Trustee March 16, 2000 ------------------------------- (William H. Walton) /s/ Kenneth S. Sweet, Jr. Trustee March 16, 2000 ------------------------------- (Kenneth S. Sweet, Jr.) /s/ Steven D. Kesler Trustee March 16, 2000 ------------------------------- (Steven D. Kesler) /s/ Edward A. Crooke Trustee March 16, 2000 ------------------------------- (Edward A. Crooke)
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