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Press release from PR Newswire

Preferred Shareholders Challenge Coercive Tender Offer For MPG Office Trust Shares

Thursday, July 11, 2013

Preferred Shareholders Challenge Coercive Tender Offer For MPG Office Trust Shares

13:50 EDT Thursday, July 11, 2013

Court Schedules Injunction Hearing for July 24 on MPG-Brookfield Merger, Parties Agree Not to Close Tender Offer Before Court's Decision

RADNOR, Pa. and BOCA RATON, Fla., July 11, 2013 /PRNewswire/ -- A preferred shareholder of MPG Office Trust, Inc. (NYSE: MPG-PA) has filed a class action lawsuit challenging the proposed merger between MPG Office Trust and affiliates of Brookfield Office Properties Inc. (NYSE: BPO) and the open tender offer by Brookfield for the preferred shares. 

The Circuit Court of Baltimore City, Maryland has scheduled a hearing for July 24, 2013 on the preferred shareholder's request for an injunction preventing the closing of the tender offer and the merger.  MPG and Brookfield have agreed not to close either until the court has ruled on the shareholder's injunction request. 

On April 25, 2013, MPG and Brookfield announced their planned merger and their agreement that Brookfield would make a tender offer for all of MPG's outstanding preferred stock.  MPG has not paid any dividends to its preferred shareholders since 2008 and, under the contract governing the preferred stock, the preferred shareholders are owed more than $9.00 per share in accrued and unpaid dividends.  Brookfield's tender offer, however, offers the preferred shareholders nothing for their accrued and unpaid dividends.  For those preferred shareholders who do not participate in the tender offer, their preferred stock will be canceled and converted into new preferred stock of a Brookfield-controlled entity, and Brookfield will decide whether, if at all, to pay any of the accrued and unpaid dividends to the non-tendering preferred shareholders.  The tender offer was scheduled to close on July 17, 2013, and MPG's common shareholders are voting on the merger on that day as well.

In the class action lawsuit, preferred shareholders allege that the tender offer and merger, as structured, both violate the terms of the contract governing the preferred stock, because the contract had promised preferred shareholders that their shares would never be "converted" without their consent.  The plaintiff also alleges that the tender offer is wrongfully coercive and unlawful, because preferred shareholders are forced to choose between tendering their shares and foregoing $9.00 in dividends owed to them, or converting their shares into Brookfield shares.  The plaintiff seeks to represent all of the preferred shareholders affected by the tender offer and the merger, and seeks an injunction preventing the closing of both transactions until they are restructured so as to comply with the preferred stock contract.  On July 9, 2013, the Circuit Court for Baltimore City, Maryland (Judge Michel Pierson) scheduled a preliminary injunction hearing for July 24, 2013, on the condition that the closing of the tender offer and merger be held open pending his decision.

Plaintiffs are represented by Lee Rudy and Michael Wagner of Kessler Topaz Meltzer & Check and Joe White and Jonathan Stein of Saxena White.  MPG's preferred shareholders are urged not to tender their shares to Brookfield while the injunction proceedings move forward in the Maryland court.  Preferred shareholders seeking more information concerning this lawsuit are urged to contact attorneys for plaintiff below. 

Kessler Topaz Meltzer & Check, LLP280 King of Prussia RoadRadnor, PA 19087

Darren Check, Esq.dcheck@ktmc.comMichael Wagner, Esq.mwagner@ktmc.com610-667-7706

SOURCE Kessler Topaz Meltzer & Check, LLP

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