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EXHIBIT 10.4
FIFTH AMENDMENT
TO
SECOND AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
OF
URBAN SHOPPING CENTERS, L.P.
This Fifth Amendment (this "Amendment") to the Second Amended and
Restated Agreement of Limited Partnership, dated as of October 14, 1993 (as
amended through the date hereof, the "Partnership Agreement"), of Urban Shopping
Centers, L.P., an Illinois limited partnership (the "Partnership"), is made as
of the 27th day of May, 1999 by Urban Shopping Centers, Inc., a Maryland
corporation, as general partner (the "General Partner"), with the consent of the
Persons whose names are set forth on Exhibit A to the Partnership Agreement, as
Limited Partners (the "Limited Partners"), and the undersigned Limited Partner
that is being admitted to the Partnership on the date hereof.
WHEREAS, the Partnership is an Illinois limited partnership existing
under the Illinois Revised Uniform Limited Partnership Act (the "Act") pursuant
to the Partnership Agreement;
WHEREAS, the General Partner and the Limited Partners desire to amend
the Partnership Agreement to create a class of Series C Cumulative Redeemable
Preferred Units (the "Series C Preferred Units") and to set forth the rights,
powers, duties and preferences of the Series C Preferred Units;
NOW THEREFORE, pursuant to the authority contained in Section 14.1.3 of
the Partnership Agreement, the General Partner and the Limited Partners hereby
amend the Partnership Agreement as follows:
SECTION 1. DEFINED TERMS. Capitalized terms used in this Amendment and
not otherwise defined herein shall have the meaning assigned thereto in the
Partnership Agreement.
SECTION 2. AMENDMENTS. Effective at (and subject to the occurrence of)
the Effective Time (as defined below), the Partnership Agreement is hereby
amended as follows:
(a) Section 4.2 of the Partnership Agreement is amended by adding the
following new subsection 4.2.9 at the end thereof:
"4.2.9 Issuance of Series C Preferred Units.
4.2.9.1 Designation and Number. The General Partner shall have
the authority to cause the Partnership to issue up to 800,000 Series C
Cumulative Redeemable Preferred Units (the "Series C Preferred Units"), which
shall be Limited Partnership Interests and shall be a separate class thereof.
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4.2.9.2 Rank. The Series C Preferred Units shall, with respect
to distributions or rights upon voluntary or involuntary liquidation, winding-up
or dissolution of the Partnership, or both, rank senior to all other classes or
series of Partnership Interests now or hereafter authorized, issued or
outstanding, other than any class or series of Partnership Interests now or
hereafter authorized and issued and expressly designated in accordance with the
Partnership Agreement as ranking on a parity with or senior to the Series C
Preferred Units with respect to distributions or rights upon voluntary or
involuntary liquidation, winding-up or dissolution of the Partnership, or both.
The Series C Preferred Units rank on a parity, with respect to distributions and
rights upon voluntary or involuntary liquidation, winding-up or dissolution of
the Partnership, with the Series A Preferred Units and the Series B Preferred
Units of the Partnership. As used in this subsection 4.2.9, the following terms
are defined as follows:
"Parity Preferred Units" shall be used to refer to any class or series
of Partnership Interests now or hereafter authorized, issued or outstanding that
are expressly designated by the Partnership to rank on a parity with Series C
Preferred Units with respect to distributions or rights upon voluntary or
involuntary liquidation, winding-up or dissolution of the Partnership, or both,
as the context may require, whether or not the distribution rates, distribution
payment dates or redemption or liquidation prices per unit or conversion rights
or exchange rights shall be different from those of the Series C Preferred
Units, and shall include, without limitation, the Series A Preferred Units and
the Series B Preferred Units of the Partnership.
"Priority Return" shall mean, with respect to the Series C Preferred
Units, an amount equal to 9 1/8% per annum, determined on the basis of a 360-day
year of twelve 30-day months (or actual days for any month that is shorter than
a full monthly period), cumulative to the extent not distributed for any given
distribution period, of the Stated Value of the Series C Preferred Units,
commencing on the date of issuance of such Series C Preferred Units, and, with
respect to the other Parity Preferred Units, the amount set forth in the
respective amendment of this Agreement establishing the terms of such other
Parity Preferred Units.
"PTP" shall mean a "publicly traded partnership" within the meaning of
Section 7704 of the Code.
"Senior Preferred Units" shall be used to refer to any class or series
of Partnership Interests of the Partnership now or hereafter authorized, issued
or outstanding that are expressly designated by the Partnership to rank senior
to Series C Preferred Units with respect to distributions or rights upon
voluntary or involuntary liquidation, winding-up or dissolution of the
Partnership, or both, as the context may require, whether or not the
distribution rates, distribution payment dates or redemption or liquidation
prices per unit or conversion rights or exchange rights shall be different from
those of the Series C Preferred Units.
"Stated Value" shall mean, with respect to the Series C Preferred
Units, an amount equal to $50.00 per Series C Preferred Unit, the original
Capital Contribution per Series C Preferred Unit, and, with respect to the other
Parity Preferred Units, the amounts set forth in the respective amendment of
this Agreement establishing the terms of such other Parity Preferred Units.
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4.2.9.3 Distributions.
(a) Payment of Distributions. Subject to the rights of holders
of Senior Preferred Units and Parity Preferred Units, if any, holders of Series
C Preferred Units shall be entitled to receive, when, as and if authorized and
declared by the Partnership acting through the General Partner, out of Available
Cash, cumulative preferential cash distributions at the rate per annum of 9 1/8%
of the Stated Value of the Series C Preferred Units. Such distributions shall be
cumulative, shall accrue from the original date of issuance and all
distributions accrued to the scheduled date of payment shall be payable in cash
(i) quarterly in arrears, on or before March 15, June 15, September 15 and
December 15 of each year commencing on September 15, 1999 and, (ii) in the event
of (A) an exchange of Series C Preferred Units into Series C Cumulative
Redeemable Preferred Stock of the General Partner (the "Series C Preferred
Stock"), or (B) a redemption of Series C Preferred Units, on the exchange date
or redemption date, as applicable (each a "Preferred Unit Distribution Payment
Date"). The amount of the distribution payable for any period shall be computed
on the basis of a 360-day year of twelve 30-day months and the amount of the
distribution payable on the initial Preferred Unit Distribution Payment Date and
for any other period shorter or longer than a full quarterly period for which
distributions are computed shall be computed on the basis of the actual number
of days elapsed. If any date on which distributions are to be made on the Series
C Preferred Units is not a Business Day, then payment of the distribution to be
made on such date shall be made on the next succeeding day that is a Business
Day (and without any interest or other payment in respect of any such delay)
except that, if such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date. Distributions on the
Series C Preferred Units shall be made to the holders of record of the Series C
Preferred Units on the relevant record dates to be fixed by the Partnership
acting through the General Partner, which record dates shall be not more than 60
days prior to the relevant Preferred Unit Distribution Payment Date (each, a
"Preferred Unit Partnership Record Date").
(b) Limitation on Distributions. No distribution on the Series
C Preferred Units shall be declared or paid or set apart for payment by the
Partnership at such time as the terms and provisions of any agreement of the
Partnership relating to its indebtedness (other than any agreement with a holder
of Partnership Interests or an Affiliate thereof), prohibit such declaration,
payment or setting apart for payment or provide that such declaration, payment
or setting apart for payment would constitute a breach thereof or a default
thereunder, or if such declaration, payment or setting apart for payment shall
be restricted or prohibited by law. Nothing in this Section 4.2.9.3(b) shall be
deemed to modify or in any manner limit the provisions of Sections 4.2.9.3(c) or
4.2.9.3(d).
(c) Distributions Cumulative. Distributions on the Series C
Preferred Units shall accrue whether or not the terms and provisions of any
agreement of the Partnership (including any agreement relating to its
indebtedness) at any time prohibit the current payment of distributions, whether
or not (i) the Partnership has earnings, (ii) there are funds legally available
for the payment of such of such distributions and (iii) such distributions are
authorized. Accrued but unpaid distributions on the Series C Preferred Units
shall accumulate as of the
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Preferred Unit Distribution Payment Date on which they first become payable.
Distributions on account of arrears for any past distribution periods may be
declared and paid at any time, without reference to a regular Preferred Unit
Distribution Payment Date, to holders of record of the Series C Preferred Units
on the record date fixed by the Partnership acting through the General Partner,
which date shall be not more than 45 days prior to the payment date. Accumulated
and unpaid distributions shall not bear interest.
(d) Priority as to Distributions. (i) So long as any Series C
Preferred Units are outstanding, no distribution of cash or other property shall
be authorized, declared, paid or set apart for payment on or with respect to any
class or series of Partnership Interests of the Partnership ranking junior to
the Series C Preferred Units with respect to distributions (collectively,
"Junior Units"), nor shall any cash or other property be set aside for or
applied to the purchase, redemption or other acquisition for consideration of
any Series C Preferred Units, any Parity Preferred Units with respect to
distributions or any Junior Units (other than for purposes of an employee
incentive or benefit plan of the Partnership or any of its Subsidiaries),
unless, in each case, all distributions accumulated on all Series C Preferred
Units and all classes and series of outstanding Parity Preferred Units with
respect to distributions have been paid in full or declared and set apart for
payment. The foregoing sentence shall not prohibit (A) distributions payable
solely in Junior Units or in options, warrants or rights to subscribe or
purchase Junior Units, (B) the conversion of Junior Units or Parity Preferred
Units into Junior Units, or (C) the redemption of Partnership Interests pursuant
to the Partnership Agreement to the extent required to preserve the General
Partner's status as a real estate investment trust.
(ii) So long as distributions have not been paid in
full (or a sum sufficient for such full payment is not irrevocably
deposited in trust for payment) upon the Series C Preferred Units, all
distributions authorized and declared on the Series C Preferred Units
and on all classes or series of outstanding Parity Preferred Units with
respect to distributions shall be authorized and declared so that the
amount of distributions authorized and declared per Series C Preferred
Unit and such other classes or series of Parity Preferred Units shall
in all cases bear to each other the same ratio that accrued
distributions per Series C Preferred Unit and such other classes or
series of Parity Preferred Units (which shall not include any
accumulation in respect of unpaid distributions for prior distribution
periods if such class or series of Parity Preferred Units does not have
cumulative distribution rights) bear to each other.
(e) No Further Rights. Holders of Series C Preferred Units
shall not be entitled to any distributions, whether payable in cash, units,
other property or otherwise, in excess of the full cumulative distributions
described herein.
4.2.9.4 Liquidation Preference.
(a) Payment of Liquidating Distributions. Subject to the
rights of holders of Senior Preferred Units and Parity Preferred Units with
respect to rights upon any voluntary or involuntary liquidation, dissolution or
winding-up of the Partnership, the holders of Series C Preferred Units shall be
entitled to receive out of the assets of the Partnership legally available for
distribution or the proceeds thereof, after payment or provision for debts and
other liabilities
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of the Partnership, but before any payment or distributions of the assets shall
be made to holders of units that rank junior to the Series C Preferred Units
with respect to rights upon liquidation, dissolution or winding-up of the
Partnership, an amount equal to the sum of (i) a liquidation preference equal to
the Stated Value of such Series C Preferred Units, and (ii) any accumulated and
unpaid Priority Return thereon, whether or not declared, to the date of payment.
If, upon such voluntary or involuntary liquidation, dissolution or winding-up,
there are insufficient assets to permit full payment of liquidating
distributions to the holders of Series C Preferred Stock and any Parity
Preferred Units with respect to rights upon liquidation, dissolution or
winding-up of the Partnership, all payments of liquidating distributions on the
Series C Preferred Units and such Parity Preferred Units shall be made so that
the payments on the Series C Preferred Units and such Parity Preferred Units
shall in all cases bear to each other the same ratio that the respective rights
of the Series C Preferred Unit and such other Parity Preferred Units (which
shall not include any accumulation in respect of unpaid distributions for prior
distribution periods if such Parity Preferred Units do not have cumulative
distribution rights) upon liquidation, dissolution or winding-up of the
Partnership bear to each other.
(b) Notice. Written notice of any such voluntary or
involuntary liquidation, dissolution or winding-up of the Partnership, stating
the payment date or dates when, and the place or places where, the amounts
distributable in such circumstances shall be payable, shall be given by first
class mail, postage pre-paid, not less than 30 and not more than 60 days prior
to the payment date stated therein, to each record holder of the Series C
Preferred Units at the respective addresses of such holders as the same shall
appear on the transfer records of the Partnership.
(c) No Further Rights. After payment of the full amount of the
liquidating distributions to which they are entitled, the holders of Series C
Preferred Units shall have no right or claim to any of the remaining assets of
the Partnership.
(d) Consolidation, Merger or Certain Other Transactions. The
voluntary sale, conveyance, lease, exchange or transfer (for cash, shares of
stock, securities or other consideration) of all or substantially all of the
property or assets of the General Partner to, or the consolidation or merger or
other business combination of the General Partner or the Partnership with or
into, any corporation, trust or other entity (or of any corporation, trust or
other entity with or into the Partnership) or a statutory share exchange of the
General Partner shall not be deemed to constitute a liquidation, dissolution or
winding-up of the Partnership.
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4.2.9.5 Optional Redemption.
(a) Right of Optional Redemption. The Series C Preferred Units
may not be redeemed prior to the fifth anniversary of the issuance date. On or
after such date, the Partnership shall have the right to redeem the Series C
Preferred Units, in whole or in part, at any time or from time to time, upon not
less than 30 nor more than 60 days' written notice, at a redemption price,
payable in cash, equal to the Capital Account balance of the holder of Series C
Preferred Units (the "Redemption Price"); provided, however, that no redemption
pursuant to this Section 4.2.9.5 will be permitted if the Redemption Price does
not equal or exceed the Stated Value per Series C Preferred Unit and all accrued
and unpaid distributions thereon to the redemption date. If fewer than all of
the outstanding Series C Preferred Units are to be redeemed, the Series C
Preferred Units to be redeemed shall be selected pro rata (as nearly as
practicable without creating fractional units).
Limitation on Redemption. The Partnership may not redeem fewer
than all of the outstanding Series C Preferred Units unless all accumulated and
unpaid distributions have been paid or declared and set apart for payment on all
Series C Preferred Units for all quarterly distribution periods terminating on
or prior to the date of redemption.
(c) Notice of Redemption. Notice of redemption will be mailed
by the Partnership, by certified mail, postage prepaid, not less than 30 nor
more than 60 days prior to the redemption date, addressed to the holders of
record of the Series C Preferred Units to be redeemed at their respective
addresses as they appear on the records of the Partnership. No failure to give
or defect in such notice shall affect the validity of the proceedings for the
redemption of any Series C Preferred Units except as to the holder to whom such
notice was defective or not given. In addition to any information required by
law, each such notice shall state: (i) the redemption date, (ii) the Redemption
Price, (iii) the aggregate number of Series C Preferred Units to be redeemed and
if fewer than all of the outstanding Series C Preferred Units are to be
redeemed, the number of Series C Preferred Units to be redeemed held by such
holder, which number shall equal such holder's pro rata share (based on the
percentage of the total number of outstanding Series C Preferred Units held by
such holder) of the aggregate number of Series C Preferred Units to be redeemed,
and (iv) the place or places where certificates representing such Series C
Preferred Units are to be surrendered for payment of the Redemption Price.
(d) Procedures for Redemption. If the Partnership gives a
notice of redemption in respect of Series C Preferred Units (which notice will
be irrevocable) then the Partnership's obligation to make available the
redemption price shall be deemed fulfilled if, on or before the redemption date,
the Partnership pays each holder of Series C Preferred Units in cash directly or
the Partnership deposits irrevocably in trust for the benefit of the Series C
Preferred Units being redeemed funds sufficient to pay the applicable Redemption
Price with irrevocable instructions and authority to pay such Redemption Price
to the holders of the Series C Preferred Units upon surrender of the Series C
Preferred Units by such holders at the place designated in the notice of
redemption. If the Series C Preferred Units are evidenced by a certificate and
if fewer than all Series C Preferred Units evidenced by any certificate are
being redeemed, a new certificate shall be issued upon surrender of the
certificate evidencing all Series C Preferred Units,
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evidencing the unredeemed Series C Preferred Units without cost to the holder
thereof. On and after the redemption date, (i) distributions shall cease to
accumulate on the Series C Preferred Units or portions thereof called for
redemption, unless the Partnership defaults in the payment thereof, (ii) such
units shall no longer be deemed to be outstanding and (iii) all rights of the
holders thereof as holders of Series C Preferred Units shall cease (except the
right to receive the redemption price and any accumulated and unpaid
distributions), unless the Partnership defaults in the payment thereof. If any
date fixed for redemption of Series C Preferred Units is not a Business Day,
then payment of the Redemption Price payable on such date will be made on the
next succeeding day that is a Business Day (and without any interest or other
payment in respect of any such delay) except that, if such Business Day falls in
the next calendar year, such payment will be made on the immediately preceding
Business Day, in each case with the same force and effect as if made on such
date fixed for redemption. If payment of the Redemption Price is improperly
withheld or refused ad not paid by the Partnership, distributions on such Series
C Preferred Units will continue to accumulate from the original redemption date
to the date of payment, in which case the actual payment date will be considered
the date fixed for redemption for purposes of calculating the applicable
Redemption Price.
4.2.9.6 Voting Rights.
(a) General. Holders of the Series C Preferred Units shall not
have any voting rights or right to consent to any matter requiring the consent
or approval of the Limited Partners, except as otherwise expressly set forth in
the Partnership Agreement and except as set forth below.
(b) Certain Voting Rights. So long as any Series C Preferred
Units remain outstanding, the Partnership shall not, without the affirmative
vote of the holders of at least two-thirds of the Series C Preferred Units
outstanding at the time (i) authorize or create, or increase the authorized or
issued amount of, any class or series of Partnership Interests ranking senior to
the Series C Preferred Units with respect to distributions or rights upon
liquidation, dissolution or winding-up or reclassify any Partnership Interests
of the Partnership into any such Partnership Interests, or create, authorize or
issue any obligations or securities convertible into or evidencing the right to
purchase any such Partnership Interests; provided, however, that no such vote of
the holders of the Series C Preferred Units shall be required if, at or prior to
the time when such action is to take effect, the Partnership provides for the
redemption of all of the Series C Preferred Units then outstanding, (ii)
authorize or create, or increase the authorized or issued amount of, any Parity
Preferred Units or reclassify any Partnership Interest of the Partnership into
any such Parity Preferred Units or create, authorize or issue any obligations or
security convertible into or evidencing the right to purchase any such Parity
Preferred Units but only to the extent such Parity Preferred Units are issued to
JMB Realty Corporation or any of its Affiliates, other than the General Partner
to the extent the issuance of such interests was to allow the General Partner to
issue corresponding preferred stock to persons other than JMB Realty Corporation
or any of its Affiliates (provided that the Partnership may issue Parity
Preferred
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Units corresponding to convertible preferred stock issued by the General Partner
in a public offering to JMB Realty Corporation and its Affiliates up to the
extent necessary for JMB Realty Corporation and its Affiliates to maintain their
percentage ownership of the General Partner's common stock on a fully diluted
basis) or (iii) amend, alter or repeal the provisions of the Partnership
Agreement, in a manner that would materially and adversely affect the powers,
rights, preferences, privileges or voting power of the Series C Preferred Units
or the holders thereof; provided, however, that any increase in the amount of
Partnership Interests or the creation or issuance of any other class or series
of Partnership Interests, in each case ranking either (A) junior to the Series C
Preferred Units with respect to distributions and rights upon liquidation,
dissolution or winding-up, or (B) on a parity with the Series C Preferred Units
with respect to distributions and rights upon liquidation, dissolution or
winding-up, shall not be deemed to materially and adversely affect such rights,
preferences, privileges or voting powers and no vote of the holders of Series C
Preferred Units shall be required in such case.
4.2.9.7 Transfer Restrictions.
(a) The Series C Preferred Units shall be subject to the
provisions of Article 11 of the Partnership Agreement.
No transfer of the Series C Preferred Units may be made without the
consent of the General Partner, which consent may be given or withheld in its
sole and absolute discretion.
4.2.9.8 Exchange Rights.
(a) Right to Exchange.
(i) Series C Preferred Units shall be exchangeable in
whole or in part at any time on or after the tenth anniversary of the
date hereof, at the option of the holders thereof, for authorized but
previously unissued shares of Series C Preferred Stock at an exchange
rate of one share of Series C Preferred Stock for one Series C
Preferred Unit, subject to adjustment as described below (the "Exchange
Price"), provided that the Series C Preferred Units will become
exchangeable at any time, in whole or in part, at the option of the
holders of Series C Preferred Units for Series C Preferred Stock if (A)
at any time full distributions shall be in arrears on any Series C
Preferred Unit with respect to six prior quarterly distribution
periods, whether or not consecutive, or (B) upon receipt by a holder or
holders of Series C Preferred Units of (I) notice from the General
Partner that the General Partner or a Subsidiary of the General Partner
has taken the position that the Partnership is, or upon the occurrence
of a defined event in the immediate future will be, a PTP and (II) an
opinion rendered by an outside nationally recognized independent
counsel familiar with such matters, addressed to a holder or holders of
Series C Preferred Units, that the Partnership is or likely is, or upon
the occurrence of a defined event in the immediate future will be or
likely will be, a PTP. In addition, the Series C Preferred Units may be
exchanged for Series C Preferred Stock, in whole or in part, at the
option of any holder prior to the tenth anniversary of the issuance
date and after the third anniversary thereof if such holder of a Series
C Preferred Units shall deliver to the General Partner either (A) a
private ruling letter addressed to
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such holder of Series C Preferred Units or (B) an opinion of
independent counsel reasonably acceptable to the General Partner based
on the enactment of temporary or final Treasury Regulations or the
publication of a Revenue Ruling, in either case to the effect that an
exchange of the Series C Preferred Units at such earlier time would not
cause the Series C Preferred Units to be considered "stock and
securities" within the meaning of Section 351(e) of the Code, for
purposes of determining whether the holder of such Series C Preferred
Units is an "investment company" under Section 721(b) of the Code if an
exchange is permitted at such earlier date. Furthermore, the Series C
Preferred Units may be exchanged in whole or in part for Series C
Preferred Stock at any time after the date hereof, if both (A) the
holder thereof concludes based on results or projected results that
there exists (in the reasonable judgment of the holder) an imminent and
substantial risk that the holder's interest in the Partnership does or
will represent more than 19.5% of the total profits or capital
interests in the Partnership (determined in accordance with Treasury
Regulations Section 1.731-2(e)(4)) for a taxable year, and (B) the
holder delivers to the General Partner an opinion of nationally
recognized independent counsel to the effect that there is an imminent
and substantial risk that the holder's interest in the Partnership does
or will represent more than 19.5% of the total profits or capital
interests in the Partnership (determined in accordance with Treasury
Regulations Section 1.731-2(e)(4)) for a taxable year.
(ii) Notwithstanding anything to the contrary set
forth in Section 4.2.9.8(a)(i) or 4.2.9.8(a)(iii), if an Exchange
Notice (as defined below) has been delivered to the General Partner,
then the General Partner may, at its option, elect to redeem or cause
the Partnership to redeem all or a portion of the outstanding Series C
Preferred Units for cash in an amount equal to the Stated Value per
Series C Preferred Unit and all accrued and unpaid distributions
thereon to the date of redemption. The General Partner may exercise its
option to redeem the Series C Preferred Units for cash pursuant to this
Section 4.2.9.8(a)(ii) by giving each holder of record of Series C
Preferred Units notice of its election to redeem for cash, within five
Business Days after receipt of the Exchange Notice, by registered mail,
postage paid, at the address of each holder set forth in the records of
the Partnership stating (i) the redemption date, which shall be no
later than 60 days following the receipt of the Exchange Notice, (ii)
the redemption price, (iii) the place or places where the Series C
Preferred Units are to be surrendered for payment of the redemption
price, and (iv) the aggregate number of Series C Preferred Units to be
redeemed, and if fewer than all of the outstanding Series C Preferred
Units are to be redeemed, the number of Series C Preferred Units to be
redeemed held by such holder, which number shall equal such holder's
pro rata share (based on the percentage of the total number of
outstanding Series C Preferred Units held by such holder) of the
aggregate number of Series C Preferred Units being redeemed.
(iii) Upon the occurrence of an event giving rise to
exchange rights pursuant to Section 4.2.9.8(a)(i), in the event an
exchange of all or a portion of Series C Preferred Units pursuant to
Section 4.2.9.8(a)(i) would violate the provisions on ownership
limitation of the General Partner set forth in Article 7 of the
Charter, the General Partner shall give written notice thereof to each
holder of record of Series C Preferred Units, within five Business Days
following receipt of the Exchange Notice, by
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registered mail, postage prepaid, at the address of each such holder
set forth in the records of the Partnership. In such event, each holder
of Series C Preferred Units shall be entitled to exchange, pursuant to
the provision of Section 4.2.9.8(b), a number of Series C Preferred
Units which would comply with the provisions on the ownership
limitation of the General Partner set forth in Article 7 of the Charter
and any Series C Preferred Units not so exchanged (the "Excess Units")
shall be redeemed by the Partnership for cash in an amount equal to the
Stated Value per Excess Unit and all accrued and unpaid distributions
thereon to the date of redemption. The written notice of the General
Partner shall state (A) the number of Excess Units held by such holder,
(B) the redemption price, (C) the redemption date, which date shall be
no later than 60 days following the receipt of the Exchange Notice, and
(D) the place or places where such Excess Units are to be surrendered
for payment of the Redemption Price. If an exchange would result in
Excess Units, as a condition to such exchange, each holder of such
Excess Units agrees to provide representations and covenants reasonably
requested by the General Partner relating to (I) the widely held nature
of the interests in such holder, sufficient to assure the General
Partner that the holder's ownership of stock of the General Partner
(without regard to the limits described above) will not cause any
individual to own in excess of 9.8% of the stock of the General
Partner; (II) to the extent such holder can so represent and covenant
without obtaining information from its owners, the holder's ownership
of tenants of the Partnership and its affiliates and (III) any other
information required by the Charter.
(iv) The redemption of Series C Preferred Units
described in Sections 4.2.9.8(a)(ii) and (iii) shall be subject to the
provisions of Section 4.2.9.5(c)(ii); provided, however, that for
purposes hereof the term "Redemption Price" in Section 4.2.9.5(c)(ii)
shall be read to mean the Stated Value per Series C Preferred Unit
being redeemed plus all accrued and unpaid distributions to the
redemption date.
(b) Procedure for Exchange.
(i) Any exchange shall be exercised pursuant to a
notice of exchange (the "Exchange Notice") delivered to the General
Partner by the holder who is exercising such exchange right, by
certified mail, postage prepaid. Upon request of the General Partner,
such holder delivering the Exchange Notice shall provide to the General
Partner in writing such information as the General Partner may
reasonably request to determine whether any portion of the exchange by
the delivering holder will result in the violation of the restrictions
of Article 7 of the Charter, including the Ownership Limit. The
exchange of Series C Preferred Units, or a specified portion thereof,
may be effected after the fifth Business Day following receipt by the
General Partner of the Exchange Notice and such requested information
by delivering certificates, if any, representing such Series C
Preferred Units to be exchanged together with, if applicable, written
notice of exchange and a proper assignment of such Series C Preferred
Units to the office of the General Partner maintained for such purpose.
Currently, such office is located at 000 X. Xxxxxxxx Xxxxxx, Xxxxx
0000, Xxxxxxx, XX 00000. Each exchange will be deemed to have been
effected immediately prior to the close of business on the date on
which such Series C Preferred Units to be exchanged (together with all
required documentation) shall have
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been surrendered and notice shall have been received by the General
Partner as aforesaid and the Exchange Price shall have been paid. Any
Series C Preferred Shares issued pursuant to this Section 4.2.9.8 shall
be delivered as shares which are duly authorized, validly issued, fully
paid and nonassessable, free of pledge, lien, encumbrance or
restriction other than those provided in the Charter, the Bylaws of the
General Partner, the Securities Act and relevant state securities or
blue sky laws.
(ii) In the event of an exchange of Series C
Preferred Units for shares of Series C Preferred Stock, an amount equal
to the accrued and unpaid distributions that are not paid pursuant to
Section 4.2.9.3(a) hereof, whether or not declared, to the date of
exchange on any Series C Preferred Units tendered for exchange shall
(A) accrue and be payable by the General Partner from and after the
date of exchange on the shares of the Series C Preferred Stock into
which such Series C Preferred Units are exchanged, and (B) continue to
accrue on such Series C Preferred Units, which shall remain outstanding
following such exchange, with the General Partner as the holder of such
Series C Preferred Units. Notwithstanding anything to the contrary set
forth herein, in no event shall a holder of a Series C Preferred Unit
that was validly exchanged into Series C Preferred Stock pursuant to
this section (other than the General Partner now holding such Series C
Preferred Unit), receive a distribution out of Available Cash of the
Partnership with respect to any Series C Preferred Units so exchanged.
(iii) Fractional shares of Series C Preferred Stock
shall not be issued upon exchange but, in lieu thereof, the General
Partner shall pay a cash adjustment based upon the fair market value of
the Series C Preferred Stock on the day prior to the exchange date as
determined in good faith by the Board of Directors of the General
Partner.
(c) Adjustment of Exchange.
(i) The Exchange Price is subject to adjustment upon
certain events, including, (A) subdivisions, combinations and
reclassification of the Series C Preferred Stock, and (B) distributions
to all holders of Series C Preferred Stock of evidences of indebtedness
of the General Partner or assets (including securities, but excluding
dividends and distributions paid in cash out of equity applicable to
Series C Preferred Stock).
(ii) In case the General Partner shall be a party to
any transaction (including, without limitation, a merger,
consolidation, statutory share exchange, tender offer for all or
substantially all of the General Partner's capital stock or sale of all
or substantially all of the General Partner's assets), in each case as
a result of which the Series C Preferred Stock will be converted into
the right to receive shares of capital stock, other securities or other
property (including cash or any combination thereof), each Series C
Preferred Unit will thereafter be exchangeable into the kind and amount
of shares of capital stock and other securities and property receivable
(including cash or any combination thereof) upon the consummation of
such transaction by a holder of that number of shares of Series C
Preferred Stock or fraction thereof into which one Series C Preferred
Unit was exchangeable immediately prior to such transaction. The
General
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Partner may not become a party to any such transaction unless the terms
thereof are consistent with the foregoing.
4.2.9.9 No Conversion Rights. The holders of the Series C
Preferred Units shall not have any rights to convert such shares into shares of
any other class or series of stock or into any other securities of, or interest
in, the Partnership.
4.2.9.10 No Sinking Fund. No sinking fund shall be established
for the retirement or redemption of the Series C Preferred Units.
4.2.9.11 PTP Obligations. Notwithstanding anything contained
in the Partnership Agreement to the contrary, prior to January 1, 2000, no
transfer (or purported transfer) by a Limited Partner of his Partnership Units
(or any economic or other interest, right or attribute therein) may be made to
any Person, and any such transfer (or purported transfer) shall be void ab
initio, and no Person shall otherwise become a Partner if (a) legal counsel to
the Partnership renders an opinion letter to the effect that such transfer
creates a substantial risk that the Partnership would be treated as a PTP within
the meaning of Section 7704 of the Code or (b) such transfer would cause the
Partnership to have more than 100 Partners within the meaning of Treasury
Regulation Section 1.7704-1(h)(3) immediately after such transfer."
(c) Clause (i) of Section 5.1 is amended to read in its
entirety as follows and clause "(ii)" thereof is renumbered as clause "(iii)":
"(i) first, with respect to any class of Partnership Interests
issued pursuant to Section 4.2.1 or 4.2.2 that are entitled to a preference over
Partnership Units on the distribution of Available Cash, (and within and among
such classes, in order of the preferences designated therein and pro rata among
any such classes), (ii) second, accumulated but unpaid distributions with
respect to any class of Partnership Interests described in clause (i) which are
accrued with respect to prior periods (and within and among such classes, in
order of the preferences designated therein and pro rata among any such classes
and within any such class), and".
(d) Sections 6.1.1 and 6.1.2 are amended to read in their
entirety as follows:
"6.1.1 Net Income. After giving effect to the special allocations set
forth in Sections 6.2 and 6.4 below, Net Income shall be allocated (a) first, to
the General Partner to the extent that, on a cumulative basis, Net Losses
previously allocated to the General Partner pursuant to the last sentence of
Section 6.1.2 exceed Net Income previously allocated to the General Partner
pursuant to this clause (a) of Section 6.1.1; (b) second, to each Partner to the
extent of, and in an amount equal to, the cumulative amount of Net Losses, if
any, that have been previously allocated to such Partner pursuant to Section
6.1.2(c) and not previously offset pursuant to this Section 6.1.1(b); (c) third,
to the Parity Preferred Unit holders (and within and among such classes, in
order of the preferences designated therein and pro rata among any such classes)
until each such holder has been allocated a cumulative amount of Net Profits
pursuant to this Section 6.1.1(c) equal to the aggregate amount of Losses
previously allocated to such Parity Preferred Unit holder pursuant to Section
6.1.2(b) and not previously offset pursuant to this Section 6.1.1(c); (d)
fourth, to the
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13
Parity Preferred Unit holders (and within and among such classes, in the order
of preferences designated therein and pro rata among any such classes) until
each such holder has been allocated a cumulative amount of Net Profits pursuant
to this Section 6.1.1(d) equal to the sum of (x) its applicable Priority Return
for the period, and (y) the aggregate amount of Priority Returns for prior
periods net of amounts previously allocated to such holder pursuant to this
Section 6.1.1(d) with respect to such prior periods and (e) thereafter, Net
Income shall be allocated to the Partners in accordance with their respective
Percentage Interests."
"6.1.2 Net Losses. After giving effect to the special allocations set
forth in Sections 6.2 and 6.4 below, Net Losses shall be allocated (a) first, to
the Partners in accordance with their respective Percentage Interests, to the
extent that Net Profits have been previously allocated to them pursuant to
Section 6.1.1(e); (b) second, to the Parity Preferred Unit holders to the extent
of and in an amount equal to the cumulative amount of Net Profits that have been
allocated to each such Parity Preferred Unit holder pursuant to Section 6.1.1(d)
(net of prior distributions to such holders) and not previously offset pursuant
to this Section 6.1.2(b); and (c) thereafter, to the Partners in accordance with
their respective Percentage Interests, provided that Net Losses shall not be
allocated to any Limited Partner pursuant to this Section 6.1.2 to the extent
that such allocation would cause such Limited Partner to have an Adjusted
Capital Account Deficit at the end of such taxable year (or increase any
existing Adjusted Capital Account Deficit). All Net Losses in excess of the
limitations set forth in this Section 6.1.2 shall be allocated to the General
Partner."
(e) Section 13.2.1 is amended to add the following new subsection
13.2.1.3 thereto and to renumber current subsection "13.2.1.3" as "13.2.1.4":
"13.2.1.3 Third, to the payment, with respect to the holders of Parity
Preferred Units, of a liquidation preference equal to (i) their Stated Value and
(ii) an amount equal to any accumulated but unpaid Priority Return thereon,
whether or not declared, to the date of payment; provided that, if, upon such
voluntary or involuntary liquidation, dissolution or winding-up, there are
insufficient assets to permit full payment of liquidating distributions to the
holders of any class or series of Parity Preferred Units as to rights upon
liquidation, dissolution or winding-up of the Partnership, all payments of
liquidating distributions on such Parity Preferred Units shall be made so that
the payments on such Parity Preferred Units shall in all cases bear to each
other the same ratio that the respective rights of such Parity Preferred Units
(which shall not include any accumulation in respect of unpaid distributions for
prior distribution periods if such Parity Preferred Units do not have cumulative
distribution rights) upon liquidation, dissolution or winding-up of the
Partnership bear to each other; and".
Section 13.3.1 is amended to add the following phrase to the first
sentence of such Section immediately after the phrase "positive Capital
Accounts" therein: "(after such Capital Accounts have been adjusted to take into
account payments accrued but unpaid as Priority Returns and return of the Stated
Value of any Priority Preferred Units)".
(i) Exhibit A to the Partnership Agreement is hereby
amended to include the Series C Preferred Units as Limited Partnership
Interests.
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14
(ii) Nothing contained in Section 8.4 of the
Partnership Agreement shall be deemed to limit the issuance of, and the
provisions applicable to, the Series C Preferred Units.
(iii) The Partnership Agreement is amended to provide
that references in the Partnership Agreement to "this Agreement" or
"the Agreement" (including indirect references such as "hereunder,"
"hereby," "herein" and "hereof") shall be deemed to be references to
the Partnership Agreement as hereby amended.
SECTION 3. EFFECTIVENESS. The amendments set forth in Section 2 hereof
shall become effective at the time of the first issuance of Series C Preferred
Units (the "Effective Time").
SECTION 4. CONTINUING EFFECTIVENESS. As herein amended, the Partnership
Agreement shall remain in full force and effect and is hereby ratified and
confirmed in all respects.
SECTION 5. GOVERNING LAW. This Amendment shall be governed by the
internal laws of the State of Illinois.
[Signature page follows]
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IN WITNESS WHEREOF, the undersigned, the General Partner of the
Partnership, has executed this Amendment to the Partnership Agreement as of the
date written above.
URBAN SHOPPING CENTERS, INC.,
By:
---------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President
IN WITNESS WHEREOF, the undersigned, which is hereby being admitted as
a Limited Partner of the Partnership, agrees to be bound by all of the terms and
conditions of the Partnership Agreement as of the date written above.
MEADOWBROOK EQUITY FUND II, LLC
By: Bessemer Trust Company, N.A.,
as its manager
By:
--------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Executive Vice President
