Exhibit 3.2
---------------------------------------
TENTH AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
AMB PROPERTY, L.P.
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TABLE OF CONTENTS
PAGE
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ARTICLE 1. DEFINED TERMS AND RULES OF CONSTRUCTION 1
SECTION 1.1 DEFINITIONS 1
SECTION 1.2 RULES OF CONSTRUCTION 20
ARTICLE 2. ORGANIZATIONAL MATTERS 20
SECTION 2.1 ORGANIZATION 20
SECTION 2.2 NAME 20
SECTION 2.3 RESIDENT AGENT; PRINCIPAL OFFICE 21
SECTION 2.4 POWER OF ATTORNEY 21
SECTION 2.5 TERM 22
SECTION 2.6 NUMBER OF PARTNERS 22
ARTICLE 3. PURPOSE 22
SECTION 3.1 PURPOSE AND BUSINESS 22
SECTION 3.2 POWERS 23
SECTION 3.3 PARTNERSHIP ONLY FOR PURPOSES SPECIFIED 23
SECTION 3.4 REPRESENTATIONS AND WARRANTIES BY THE PARTIES 24
SECTION 3.5 CERTAIN ERISA MATTERS 25
ARTICLE 4. CAPITAL CONTRIBUTIONS 26
SECTION 4.1 CAPITAL CONTRIBUTIONS OF THE PARTNERS 26
SECTION 4.2 LOANS BY THIRD PARTIES 26
SECTION 4.3 ADDITIONAL FUNDING AND CAPITAL CONTRIBUTIONS 26
SECTION 4.4 STOCK INCENTIVE PLAN 29
SECTION 4.5 NO PREEMPTIVE RIGHTS 29
SECTION 4.6 OTHER CONTRIBUTION PROVISIONS 29
i
ARTICLE 5. DISTRIBUTIONS 29
SECTION 5.1 REQUIREMENT AND CHARACTERIZATION OF DISTRIBUTIONS 29
SECTION 5.2 DISTRIBUTIONS IN KIND 30
SECTION 5.3 DISTRIBUTIONS UPON LIQUIDATION 30
SECTION 5.4 DISTRIBUTIONS TO REFLECT ISSUANCE OF ADDITIONAL PARTNERSHIP
INTERESTS 30
SECTION 5.5 CHARACTER OF PLP DISTRIBUTIONS 31
ARTICLE 6. ALLOCATIONS 31
SECTION 6.1 TIMING AND AMOUNT OF ALLOCATIONS OF NET INCOME AND NET LOSS 31
SECTION 6.2 GENERAL ALLOCATIONS 31
SECTION 6.3 ADDITIONAL ALLOCATION PROVISIONS 34
SECTION 6.4 TAX ALLOCATIONS 36
ARTICLE 7. MANAGEMENT AND OPERATIONS OF BUSINESS 36
SECTION 7.1 MANAGEMENT 36
SECTION 7.2 CERTIFICATE OF LIMITED PARTNERSHIP 40
SECTION 7.3 RESTRICTIONS ON GENERAL PARTNER'S AUTHORITY 40
SECTION 7.4 REIMBURSEMENT OF THE GENERAL PARTNER 43
SECTION 7.5 OUTSIDE ACTIVITIES OF THE GENERAL PARTNER 43
SECTION 7.6 CONTRACTS WITH AFFILIATES 44
SECTION 7.7 INDEMNIFICATION 45
SECTION 7.8 LIABILITY OF THE GENERAL PARTNER 47
SECTION 7.9 OTHER MATTERS CONCERNING THE GENERAL PARTNER 47
SECTION 7.10 TITLE TO PARTNERSHIP ASSETS 48
SECTION 7.11 RELIANCE BY THIRD PARTIES 48
ARTICLE 8. RIGHTS AND OBLIGATIONS OF LIMITED PARTNERS 49
SECTION 8.1 LIMITATION OF LIABILITY 49
SECTION 8.2 MANAGEMENT OF BUSINESS 49
SECTION 8.3 OUTSIDE ACTIVITIES OF LIMITED PARTNERS 49
ii
SECTION 8.4 RETURN OF CAPITAL 50
SECTION 8.5 RIGHTS OF LIMITED PARTNERS RELATING TO THE PARTNERSHIP 50
SECTION 8.6 COMMON LIMITED PARTNER REDEMPTION RIGHTS 51
ARTICLE 9. BOOKS, RECORDS, ACCOUNTING AND REPORTS 53
SECTION 9.1 RECORDS AND ACCOUNTING 53
SECTION 9.2 FISCAL YEAR 53
SECTION 9.3 REPORTS 53
SECTION 9.4 NONDISCLOSURE OF CERTAIN INFORMATION 54
ARTICLE 10. TAX MATTERS 54
SECTION 10.1 PREPARATION OF TAX RETURNS 54
SECTION 10.2 TAX ELECTIONS 54
SECTION 10.3 TAX MATTERS PARTNER 54
SECTION 10.4 ORGANIZATIONAL EXPENSES 56
SECTION 10.5 WITHHOLDING 56
ARTICLE 11. TRANSFERS AND WITHDRAWALS 57
SECTION 11.1 TRANSFER 57
SECTION 11.2 TRANSFER OF GENERAL PARTNER'S PARTNERSHIP INTEREST 57
SECTION 11.3 LIMITED PARTNERS' RIGHTS TO TRANSFER 59
SECTION 11.4 SUBSTITUTED LIMITED PARTNERS 61
SECTION 11.5 ASSIGNEES 61
SECTION 11.6 GENERAL PROVISIONS 62
ARTICLE 12. ADMISSION OF PARTNERS 64
SECTION 12.1 ADMISSION OF SUCCESSOR GENERAL PARTNER 64
SECTION 12.2 ADMISSION OF ADDITIONAL LIMITED PARTNERS 64
SECTION 12.3 AMENDMENT OF AGREEMENT AND CERTIFICATE OF LIMITED PARTNERSHIP 65
iii
ARTICLE 13. DISSOLUTION AND LIQUIDATION 65
SECTION 13.1 DISSOLUTION 65
SECTION 13.2 WINDING UP 66
SECTION 13.3 COMPLIANCE WITH TIMING REQUIREMENTS OF REGULATIONS 67
SECTION 13.4 DEEMED DISTRIBUTION AND RECONTRIBUTION 68
SECTION 13.5 RIGHTS OF LIMITED PARTNERS 68
SECTION 13.6 NOTICE OF DISSOLUTION 68
SECTION 13.7 CANCELLATION OF CERTIFICATE OF LIMITED PARTNERSHIP 68
SECTION 13.8 REASONABLE TIME FOR WINDING-UP 68
SECTION 13.9 WAIVER OF PARTITION 69
ARTICLE 14. AMENDMENT OF PARTNERSHIP AGREEMENT; CONSENTS 69
SECTION 14.1 AMENDMENTS 69
SECTION 14.2 ACTION BY THE PARTNERS 69
ARTICLE 15. GENERAL PROVISIONS 70
SECTION 15.1 ADDRESSES AND NOTICE 70
SECTION 15.2 TITLES AND CAPTIONS 70
SECTION 15.3 PRONOUNS AND PLURALS 70
SECTION 15.4 FURTHER ACTION 70
SECTION 15.5 BINDING EFFECT 71
SECTION 15.6 CREDITORS 71
SECTION 15.7 WAIVER 71
SECTION 15.8 COUNTERPARTS 71
SECTION 15.9 APPLICABLE LAW 71
SECTION 15.10 INVALIDITY OF PROVISIONS 71
SECTION 15.11 LIMITATION TO PRESERVE REIT STATUS 71
SECTION 15.12 ENTIRE AGREEMENT 72
SECTION 15.13 NO RIGHTS AS STOCKHOLDERS 72
iv
ARTICLE 16. INTENTIONALLY OMITTED 72
ARTICLE 17. INTENTIONALLY OMITTED 72
ARTICLE 18. SERIES J PREFERRED XXXXX 00
XXXXXXX 00.0 DESIGNATION AND NUMBER 73
SECTION 18.2 RANKING 73
SECTION 18.3 DISTRIBUTIONS 73
SECTION 18.4 LIQUIDATION PROCEEDS 75
SECTION 18.5 REDEMPTION 75
SECTION 18.6 VOTING RIGHTS 77
SECTION 18.7 TRANSFER RESTRICTIONS 77
SECTION 18.8 EXCHANGE RIGHTS 78
SECTION 18.9 NO CONVERSION RIGHTS 82
SECTION 18.10 NO SINKING FUND 82
ARTICLE 19. SERIES K PREFERRED XXXXX 00
XXXXXXX 00.0 DESIGNATION AND NUMBER 83
SECTION 19.2 RANKING 83
SECTION 19.3 DISTRIBUTIONS 83
SECTION 19.4 LIQUIDATION PROCEEDS 85
SECTION 19.5 REDEMPTION 85
SECTION 19.6 VOTING RIGHTS 87
SECTION 19.7 TRANSFER RESTRICTIONS 87
SECTION 19.8 EXCHANGE RIGHTS 88
SECTION 19.9 NO CONVERSION RIGHTS 92
SECTION 19.10 NO SINKING FUND 92
ARTICLE 20. SERIES L PREFERRED XXXXX 00
XXXXXXX 00.0 DESIGNATION AND NUMBER 92
SECTION 20.2 RANKING 93
v
SECTION 20.3 DISTRIBUTIONS 93
SECTION 20.4 LIQUIDATION PROCEEDS 94
SECTION 20.5 REDEMPTION 95
SECTION 20.6 VOTING RIGHTS 96
SECTION 20.7 TRANSFER RESTRICTIONS 96
SECTION 20.8 NO CONVERSION RIGHTS 96
SECTION 20.9 NO SINKING FUND 96
ARTICLE 21. SERIES M PREFERRED XXXXX 00
XXXXXXX 00.0 DESIGNATION AND NUMBER 97
SECTION 21.2 RANKING 97
SECTION 21.3 DISTRIBUTIONS 97
SECTION 21.4 LIQUIDATION PROCEEDS 98
SECTION 21.5 REDEMPTION 99
SECTION 21.6 VOTING RIGHTS 100
SECTION 21.7 TRANSFER RESTRICTIONS 100
SECTION 21.8 NO CONVERSION RIGHTS 100
SECTION 21.9 NO SINKING FUND 101
vi
TENTH AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
AMB PROPERTY, L.P.
THIS TENTH AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP, dated as of November 26, 2003, is entered into by and among AMB
Property Corporation, a Maryland corporation (the "Company"), as the General
Partner, and the Persons whose names are set forth on Exhibit A attached hereto,
as the Limited Partners (the "Existing Limited Partners"), together with any
other Persons who become Partners in the Partnership as provided herein.
WHEREAS, pursuant to Sections 7.3D(ii), the Partnership
Agreement may be amended by the General Partner to reflect the termination of or
reduction in Partnership Interests or the withdrawal of Partners;
WHEREAS, on the date hereof, the Partnership has redeemed all
of the outstanding Series B Preferred Units from the Series B Limited Partner
pursuant to the terms and provisions of the Series B Preferred Units as set
forth in the Partnership Agreement; and
WHEREAS, the General Partner and the Partnership believe it is
desirable and in the best interest of the Partnership to amend and restate the
Partnership Agreement to reflect the elimination of the Series B Preferred Units
and as set forth herein.
NOW, THEREFORE, pursuant to Sections 2.4 and 7.3D(ii) and
(iii) of the Partnership Agreement, the General Partner, on its own behalf and
as attorney-in-fact for the Limited Partners, hereby amends and restates the
Partnership Agreement as follows:
ARTICLE 1.
DEFINED TERMS AND RULES OF CONSTRUCTION
Section 1.1. Definitions
The following definitions shall be for all purposes, unless
otherwise clearly indicated to the contrary, applied to the terms used in this
Agreement.
"Act" means the Delaware Revised Uniform Limited Partnership
Act, as it may be amended from time to time, and any successor to such statute.
"Additional Funds" shall have the meaning set forth in Section
4.3.A.
"Additional Limited Partner" means a Person admitted to the
Partnership as a Limited Partner pursuant to Section 12.2 and who is shown as
such on the books and records of the Partnership.
"Adjusted Capital Account Deficit" means, with respect to any
Partner, the deficit balance, if any, in such Partner's Capital Account as of
the end of the relevant fiscal year, after giving effect to the following
adjustments:
(i) decrease such deficit by any amounts which such
Partner is obligated to restore pursuant to this
Agreement or is deemed to be obligated to restore
pursuant to Regulations Section 1.704-1(b)(2)(ii)(c)
or the penultimate sentence of each of Regulations
Sections 1.704-2(i)(5) and 1.704-2(g); and
(ii) increase such deficit by the items described in
Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) and
(6).
The foregoing definition of Adjusted Capital Account Deficit
is intended to comply with the provisions of Regulations Section
1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.
"Adjustment Date" shall have the meaning set forth in Section
4.3.E.
"Affiliate" means, with respect to any Person, any Person
directly or indirectly controlling, controlled by or under common control with
such Person.
"Agreed Value" means (i) in the case of any Contributed
Property set forth in Exhibit A and as of the time of its contribution to the
Partnership, the Agreed Value of such property as set forth in Exhibit A; (ii)
in the case of any Contributed Property not set forth in Exhibit A and as of the
time of its contribution to the Partnership, the fair market value of such
property or other consideration as determined by the General Partner, reduced by
any liabilities either assumed by the Partnership upon such contribution or to
which such property is subject when contributed; and (iii) in the case of any
property distributed to a Partner by the Partnership, the fair market value of
such property as determined by the General Partner at the time such property is
distributed, reduced by any indebtedness either assumed by such Partner upon
such distribution or to which such property is subject at the time of the
distribution as determined under Section 752 of the Code and the Regulations
thereunder.
"Agreement" means this Tenth Amended and Restated Agreement of
Limited Partnership, as it may be amended, modified, supplemented or restated
from time to time.
"Appraisal" means with respect to any assets, the opinion of
an independent third party experienced in the valuation of similar assets,
selected by the General Partner in good faith; such opinion may be in the form
of an opinion by such independent third party that the value for such asset as
set by the General Partner is fair, from a financial point of view, to the
Partnership.
"Assignee" means a Person to whom one or more Partnership
Units have been transferred in a manner permitted under this Agreement, but who
has not become a Substituted Limited Partner, and who has the rights set forth
in Section 11.5.
"Available Cash" means, with respect to any period for which
such calculation is being made, (i) the sum of:
2
(a) the Partnership's Net Income or Net Loss (as
the case may be) for such period,
(b) Depreciation and all other noncash charges
deducted in determining Net Income or Net Loss for such
period,
(c) the amount of any reduction in reserves of
the Partnership referred to in clause (ii)(f) below
(including, without limitation, reductions resulting because
the General Partner determines such amounts are no longer
necessary),
(d) the excess of the net proceeds from the
sale, exchange, disposition, or refinancing of Partnership
property for such period over the gain (or loss, as the case
may be) recognized from any such sale, exchange, disposition,
or refinancing during such period (excluding Terminating
Capital Transactions), and
(e) all other cash received by the Partnership
for such period that was not included in determining Net
Income or Net Loss for such period;
(ii) less the sum of:
(a) all principal debt payments made during such
period by the Partnership,
(b) capital expenditures made by the Partnership
during such period,
(c) investments in any entity (including loans
made thereto) to the extent that such investments are not
otherwise described in clauses (ii)(a) or (b),
(d) all other expenditures and payments not
deducted in determining Net Income or Net Loss for such
period,
(e) any amount included in determining Net
Income or Net Loss for such period that was not received by
the Partnership during such period,
(f) the amount of any increase in reserves
established during such period which the General Partner
determines are necessary or appropriate in its sole and
absolute discretion, and
(g) the amount of any working capital accounts
and other cash or similar balances which the General Partner
determines to be necessary or appropriate in its sole and
absolute discretion.
Notwithstanding the foregoing, Available Cash shall not
include any cash received or reductions in reserves, or take into account any
disbursements made or reserves established, after commencement of the
dissolution and liquidation of the Partnership.
"Board of Directors" means the Board of Directors of the
General Partner.
3
"Business Day" means each day, other than a Saturday or a
Sunday, which is not a day on which banking institutions in Los Angeles,
California or New York, New York are authorized or required by law, regulation
or executive order to close.
"Capital Account" means, with respect to any Partner, the
Capital Account maintained for such Partner in accordance with the following
provisions:
(i) To each Partner's Capital Account there shall be
added such Partner's Capital Contributions, such Partner's share of Net Income
and any items in the nature of income or gain which are specially allocated
pursuant to Section 6.3, and the amount of any Partnership liabilities assumed
by such Partner or which are secured by any property distributed to such
Partner.
(ii) From each Partner's Capital Account there shall be
subtracted the amount of cash and the Gross Asset Value of any property
distributed to such Partner pursuant to any provision of this Agreement, such
Partner's distributive share of Net Losses and any items in the nature of
expenses or losses which are specially allocated pursuant to Section 6.3 hereof,
and the amount of any liabilities of such Partner assumed by the Partnership or
which are secured by any property contributed by such Partner to the
Partnership.
(iii) In the event any interest in the Partnership is
transferred in accordance with the terms of this Agreement, the transferee shall
succeed to the Capital Account of the transferor to the extent it relates to the
transferred interest.
(iv) In determining the amount of any liability for
purposes of subsections (i) and (ii) hereof, there shall be taken into account
Code Section 752(c) and any other applicable provisions of the Code and
Regulations.
(v) The foregoing provisions and the other provisions of
this Agreement relating to the maintenance of Capital Accounts are intended to
comply with Regulations Sections 1.704-1(b) and 1.704-2, and shall be
interpreted and applied in a manner consistent with such Regulations. In the
event the General Partner shall determine that it is prudent to modify the
manner in which the Capital Accounts, or any debits or credits thereto
(including, without limitation, debits or credits relating to liabilities which
are secured by contributed or distributed property or which are assumed by the
Partnership, the General Partner, or the Limited Partners) are computed in order
to comply with such Regulations, the General Partner may make such modification;
provided that, it is not likely to have a material effect on the amounts
distributable to any Person pursuant to Article 13 of this Agreement upon the
dissolution of the Partnership. The General Partner also shall (a) make any
adjustments that are necessary or appropriate to maintain equality between the
Capital Accounts of the Partners and the amount of Partnership capital reflected
on the Partnership's balance sheet, as computed for book purposes, in accordance
with Regulations Section 1.704-1(b)(2)(iv)(q) and (b) make any appropriate
modifications in the event unanticipated events might otherwise cause this
Agreement not to comply with Regulations Section 1.704-1(b) or Section 1.704-2.
"Capital Contribution" means, with respect to any Partner, the
amount of money and the initial Gross Asset Value of any property (other than
money) contributed to the Partnership by such Partner.
4
"Cash Amount" means, with respect to any Partnership Units
subject to a Redemption, an amount of cash equal to the Deemed Partnership
Interest Value attributable to such Partnership Units.
"Certificate" means the Certificate of Limited Partnership
relating to the Partnership filed in the office of the Secretary of State of
Delaware, as amended from time to time in accordance with the terms hereof and
the Act.
"Charter" means the Company's Articles of Incorporation as of
November 24, 1997, as amended by the Articles Supplementary filed with the
Maryland Department of Assessments and Taxation on July 23, 1998, as further
amended by the Articles Supplementary filed with the Maryland Department of
Assessments and Taxation on November 12, 1998, as further amended by the
Articles Supplementary filed by the Corporation on November 25, 1998, as further
amended by the Certificate of Correction filed by the Corporation on March 18,
1999, as further amended by the Articles Supplementary filed with the Maryland
Department of Assessments and Taxation on May 5, 1999, as further amended by the
Articles Supplementary filed with the Maryland Department of Assessments and
Taxation on August 31, 1999, as further amended by the Articles Supplementary
filed with the Maryland Department of Assessments and Taxation on March 23,
2000, as further amended by the Articles Supplementary with the Maryland
Department of Assessments and Taxation on August 30, 2000, as further amended by
the Articles Supplementary filed with the Maryland Department of Assessments and
Taxation on September 1, 2000, as further amended by the Articles Supplementary
filed with the Maryland Department of Assessments and Taxation on March 21,
2001, as further amended by the Articles Supplementary filed with the Maryland
Department of Assessments and Taxation on September 24, 2001, as further amended
by the Articles Supplementary filed with the Maryland Department of Assessments
and Taxation on December 6, 2001, as further amended by the Articles
Supplementary filed with the Maryland Department of Assessments and Taxation on
April 17, 2002, as further amended by the Articles Supplementary filed with the
Maryland Department of Assessments and Taxation on August 7, 2002 Redesignating
and Reclassifying All 20,000 Shares of 7.95% Series G Cumulative Redeemable
Preferred Stock as Preferred Stock, as further amended by the Articles
Supplementary filed with the Maryland Department of Assessments and Taxation on
August 7, 2002 Redesignating and Reclassifying 130,000 Shares of 7.95% Series F
Cumulative Redeemable Preferred Stock as Preferred Stock, as further amended by
the Articles Supplementary filed with the Maryland Department of Assessments and
Taxation on June 20, 2003, as further amended by the Articles Supplementary
filed with the Maryland Department of Assessments and Taxation on November 24,
2003, as further amended by the Articles Supplementary to be filed with the
Maryland Department of Assessments and Taxation in December 2003 Redesignating
and Reclassifying 1,300,000 Shares of 8 5/8% Series B Cumulative Redeemable
Preferred Stock as Preferred Stock, and as further amended or restated from time
to time.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time or any successor statute thereto, as interpreted by the
applicable regulations thereunder. Any reference herein to a specific section or
sections of the Code shall be deemed to include a reference to any corresponding
provision of future law.
5
"Common Unit" means each Partnership Unit that is not entitled
to any preference with respect to any other Partnership Unit as to distribution
or voluntary or involuntary liquidation, dissolution or winding up of the
Partnership.
"Consent" means the consent to, approval of, or vote on a
proposed action by a Partner given in accordance with Article 14 hereof.
"Consent of the Limited Partners" means the Consent of a
Majority in Interest of the Limited Partners, other than the Preferred Limited
Partners, which Consent shall be obtained prior to the taking of any action for
which it is required by this Agreement and may be given or withheld by a
Majority in Interest of the Limited Partners, unless otherwise expressly
provided herein, in their sole and absolute discretion.
"Consent of the Partners" means the Consent of Partners, other
than the Preferred Limited Partners, holding Percentage Interests that in the
aggregate are equal to or greater than a majority of the aggregate Percentage
Interests of all Partners, other than the Preferred Limited Partners, which
Consent shall be obtained prior to the taking of any action for which it is
required by this Agreement and may be given or withheld by such Partners, in
their sole and absolute discretion.
"Constructively Own" means ownership under the constructive
ownership rules described in Exhibit C.
"Contributed Property" means each property or other asset, in
such form as may be permitted by the Act, but excluding cash, contributed or
deemed contributed to the Partnership (or, to the extent provided in applicable
regulations, deemed contributed by the Partnership on termination and
reconstitution thereof pursuant to Section 708 of the Code).
"Debt" means, as to any Person, as of any date of
determination: (i) all indebtedness of such Person for borrowed money or for the
deferred purchase price of property or services; (ii) all amounts owed by such
Person to banks or other Persons in respect of reimbursement obligations under
letters of credit, surety bonds and other similar instruments guaranteeing
payment or other performance of obligations by such Person; (iii) all
indebtedness for borrowed money or for the deferred purchase price of property
or services secured by any lien on any property owned by such Person, to the
extent attributable to such Person's interest in such property, even though such
Person has not assumed or become liable for the payment thereof; and (iv) lease
obligations of such Person which, in accordance with generally accepted
accounting principles, should be capitalized.
"Deemed Partnership Interest Value" means, as of any date with
respect to any class of Partnership Interests, the Deemed Value of the
Partnership Interests of such class multiplied by the applicable Partner's
Percentage Interest of such class.
"Deemed Value of the Partnership Interests" means, as of any
date with respect to any class or series of Partnership Interests, (i) the total
number of Partnership Units of the General Partner in such class or series of
Partnership Interests (as provided for in Sections 4.1 and 4.3.C) issued and
outstanding as of the close of business on such date multiplied by the Fair
Market Value determined as of such date of a share of capital stock of the
General Partner which corresponds to such class or series of Partnership
Interests, as adjusted pursuant to Section 7.5
6
(in the event the General Partner acquires material assets, other than on behalf
of the Partnership) and for stock dividends and distributions, stock splits and
subdivisions, reverse stock splits and combinations, distribution of warrants or
options and distributions of evidences of indebtedness or assets not received by
the General Partner pursuant to a pro rata distribution by the Partnership; (ii)
divided by the Percentage Interest of the General Partner in such class or
series of Partnership Interests on such date; provided, that if no outstanding
shares of capital stock of the General Partner correspond to a class of series
of Partnership Interests, the Deemed Value of the Partnership Interests with
respect to such class or series shall be equal to an amount reasonably
determined by the General Partner.
"Depreciation" means, for each fiscal year or other period, an
amount equal to the depreciation, amortization or other cost recovery deduction
allowable with respect to an asset for such year or other period, except that if
the Gross Asset Value of an asset differs from its adjusted basis for Federal
income tax purposes at the beginning of such year or other period, Depreciation
shall be an amount which bears the same ratio to such beginning Gross Asset
Value as the Federal income tax depreciation, amortization or other cost
recovery deduction for such year or other period bears to such beginning
adjusted tax basis; provided, however, that if the Federal income tax
depreciation, amortization or other cost recovery deduction for such year is
zero, Depreciation shall be determined with reference to such beginning Gross
Asset Value using any reasonable method selected by the General Partner.
"Effective Date" means the date of closing of the initial
public offering of REIT Shares upon which date contributions set forth on
Exhibit A shall become effective.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
"Escrow Agreements" means one or more of the agreements
between the Company, the Partnership and one or more of the Performance
Investors, dated as of the closing of the date of the initial public offering of
the common stock of the General Partner, pursuant to which the Performance
Investors have deposited their Performance Shares in escrow for possible
transfer to the General Partner or the Partnership (as applicable).
"Excess Performance Capital" means, with respect to a
Performance Partner, an amount equal to the number of Partnership Units held by
such Performance Partner, multiplied by the excess of (i) the Capital Account
per Partnership Unit for such Performance Partner; over (ii) the Capital Account
per Partnership Unit for a Limited Partner which is not a PLP or a Performance
Partner. For purposes of (ii) above, it shall be assumed that the Limited
Partner has no special arrangements with the Partnership, other than as set
forth in this Agreement, which would cause its Capital Account per Partnership
Unit to be different from the Capital Account per Partnership Unit of other
Limited Partners who are not Performance Partners or PLPs. If the Partner
described in (ii) above does not exist, the amount used for purposes of (ii)
shall be the projected Capital Account balance per Partnership Unit for such
Partner, determined in the reasonable discretion of the General Partner. For
purposes of this definition, to the extent the Capital Account of a Partner
which owns both Common Units and Preference Units is being considered, such
Capital Account shall be equal to such Partner's Capital Account determined
without regard to the adjustments arising from or as a result of the acquisition
or ownership of Preference Units by such Partner.
7
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
"Fair Market Value" means, with respect to any share of
capital stock of the General Partner, the average of the daily market price for
the ten (10) consecutive trading days immediately preceding the date with
respect to which "Fair Market Value" must be determined hereunder or, if such
date is not a Business Day, the immediately preceding Business Day. The market
price for each such trading day shall be (i) if such shares are listed or
admitted to trading on any securities exchange or the Nasdaq National Market,
the closing price, regular way, on such day, or if no such sale takes place on
such day, the average of the closing bid and asked prices on such day, (ii) if
such shares are not listed or admitted to trading on any securities exchange or
the Nasdaq National Market, the last reported sale price on such day or, if no
sale takes place on such day, the average of the closing bid and asked prices on
such day, as reported by a reliable quotation source designated by the General
Partner or (iii) if such shares are not listed or admitted to trading on any
securities exchange or the Nasdaq National Market and no such last reported sale
price or closing bid and asked prices are available, the average of the reported
high bid and low asked prices on such day, as reported by a reliable quotation
source designated by the General Partner, or if there shall be no bid and asked
prices on such day, the average of the high bid and low asked prices, as so
reported, on the most recent day (not more than ten (10) days prior to the date
in question) for which prices have been so reported; provided, that if there are
no bid and asked prices reported during the ten (10) days prior to the date in
question, the Fair Market Value of such shares shall be determined by the
General Partner acting in good faith on the basis of such quotations and other
information as it considers, in its reasonable judgment, appropriate. In the
event the REIT Shares Amount for such shares includes rights that a holder of
such shares would be entitled to receive, then the Fair Market Value of such
rights shall be determined by the General Partner acting in good faith on the
basis of such quotations and other information as it considers, in its
reasonable judgment, appropriate; provided, that in connection with determining
the Deemed Value of the Partnership Interests for purposes of determining the
number of additional Partnership Units issuable upon a Capital Contribution
funded by an underwritten public offering of shares of capital stock of the
General Partner, the Fair Market Value of such shares shall be the public
offering price per share of such class of capital stock sold. Notwithstanding
the foregoing, the General Partner in its reasonable discretion may use a
different "Fair Market Value" for purposes of making the determinations under
subparagraph (ii) of the definition of "Gross Asset Value" and Section 4.3.E. in
connection with the contribution of Property to the Partnership by a
third-party, provided such value shall be based upon the value per REIT Share
(or per Partnership Unit) agreed upon by the General Partner and such
third-party for purposes of such contribution.
"Funding Debt" means the incurrence of any Debt by or on
behalf of the General Partner for the purpose of providing funds to the
Partnership.
"General Partner" means the Company or its successors as
general partner of the Partnership.
"General Partner Interest" means a Partnership Interest held
by the General Partner. A General Partner Interest may be expressed as a number
of Partnership Units.
"General Partner Loan" shall have the meaning set forth in
Section 4.3.B.
8
"General Partner Payment" shall have the meaning set forth in
Section 15.11.
"Gross Asset Value" means, with respect to any asset, the
asset's adjusted basis for Federal income tax purposes, except as follows:
(i) The initial Gross Asset Value of any asset
contributed by a Partner to the Partnership shall be the gross fair market value
of such asset, as determined by the contributing Partner and the General Partner
(as set forth on Exhibit A attached hereto, as such Exhibit may be amended from
time to time); provided, that if the contributing Partner is the General Partner
then, except with respect to the General Partner's initial Capital Contribution
which shall be determined as set forth on Exhibit A, or capital contributions of
cash, REIT Shares or other shares of capital stock of the General Partner, the
determination of the fair market value of the contributed asset shall be
determined by (a) the price paid by the General Partner if the asset is acquired
by the General Partner contemporaneously with its contribution to the
Partnership or (b) by Appraisal if otherwise acquired by the General Partner.
(ii) Immediately prior to the times listed below, the
Gross Asset Values of all Partnership assets shall be adjusted to equal their
respective gross fair market values, as determined by the General Partner using
such reasonable method of valuation as it may adopt; provided, however, that for
such purpose, the net value of all of the Partnership assets, in the aggregate,
shall be equal to the Deemed Value of the Partnership Interests of all classes
of Partnership Interests then outstanding, regardless of the method of valuation
adopted by the General Partner:
(a) the acquisition of an additional interest in the
Partnership by a new or existing Partner in exchange
for more than a de minimis Capital Contribution, if
the General Partner reasonably determines that such
adjustment is necessary or appropriate to reflect the
relative economic interests of the Partners in the
Partnership;
(b) the distribution by the Partnership to a Partner of
more than a de minimis amount of Partnership property
as consideration for an interest in the Partnership
if the General Partner reasonably determines that
such adjustment is necessary or appropriate to
reflect the relative economic interests of the
Partners in the Partnership; the Partners agree that
such an adjustment is appropriate when the
Partnership effects a Redemption;
(c) the liquidation of the Partnership within the meaning
of Regulations Section 1.704-1(b)(2)(ii)(g);
(d) the issuance of Performance Units; and
(e) at such other times as the General Partner shall
reasonably determine necessary or advisable in order
to comply with Regulations Sections 1.704-1(b) and
1.704-2.
(iii) The Gross Asset Value of any Partnership asset
distributed to a Partner shall be the gross fair market value of such asset on
the date of distribution as determined by the
9
distributee and the General Partner; provided, that if the distributee is the
General Partner, or if the distributee and the General Partner cannot agree on
such a determination, by Appraisal.
(iv) The Gross Asset Values of Partnership assets shall be
increased (or decreased) to reflect any adjustments to the adjusted basis of
such assets pursuant to Code Section 734(b) or Code Section 743(b), but only to
the extent that such adjustments are taken into account in determining Capital
Accounts pursuant to Regulations Section 1.704-1(b)(2)(iv)(m); provided,
however, that Gross Asset Values shall not be adjusted pursuant to this
subparagraph (iv) to the extent that the General Partner reasonably determines
that an adjustment pursuant to subparagraph (ii) is necessary or appropriate in
connection with a transaction that would otherwise result in an adjustment
pursuant to this subparagraph (iv).
(v) If the Gross Asset Value of a Partnership asset has
been determined or adjusted pursuant to subparagraph (i), (ii) or (iv), such
Gross Asset Value shall thereafter be adjusted by the Depreciation taken into
account with respect to such asset for purposes of computing Net Income and Net
Losses.
"Holder" means either the Partner or Assignee owning a
Partnership Unit.
"Immediate Family" means, with respect to any natural Person,
such natural Person's estate or heirs or current spouse or former spouse,
parents, parents-in-law, children, siblings and grandchildren and any trust or
estate, all of the beneficiaries of which consist of such Person or such
Person's spouse, former spouse, parents, parents-in-law, children, siblings or
grandchildren.
"Incapacity" or "Incapacitated" means: (i) as to any
individual Partner, death, total physical disability or entry by a court of
competent jurisdiction adjudicating him or her incompetent to manage his or her
Person or his or her estate; (ii) as to any corporation which is a Partner, the
filing of a certificate of dissolution, or its equivalent, for the corporation
or the revocation of its charter; (iii) as to any partnership which is a
Partner, the dissolution and commencement of winding up of the partnership; (iv)
as to any estate which is a Partner, the distribution by the fiduciary of the
estate's entire interest in the Partnership; (v) as to any trustee of a trust
which is a Partner, the termination of the trust (but not the substitution of a
new trustee); or (vi) as to any Partner, the bankruptcy of such Partner. For
purposes of this definition, bankruptcy of a Partner shall be deemed to have
occurred when (a) the Partner commences a voluntary proceeding seeking
liquidation, reorganization or other relief under any bankruptcy, insolvency or
other similar law now or hereafter in effect, (b) the Partner is adjudged as
bankrupt or insolvent, or a final and nonappealable order for relief under any
bankruptcy, insolvency or similar law now or hereafter in effect has been
entered against the Partner, (c) the Partner executes and delivers a general
assignment for the benefit of the Partner's creditors, (d) the Partner files an
answer or other pleading admitting or failing to contest the material
allegations of a petition filed against the Partner in any proceeding of the
nature described in clause (b) above, (e) the Partner seeks, consents to or
acquiesces in the appointment of a trustee, receiver or liquidator for the
Partner or for all or any substantial part of the Partner's properties, (f) any
proceeding seeking liquidation, reorganization or other relief under any
bankruptcy, insolvency or other similar law now or hereafter in effect has not
been dismissed within one hundred and twenty (120) days after the commencement
thereof, (g) the appointment without the Partner's consent or acquiescence of a
trustee, receiver or liquidator has not been vacated or
10
stayed within ninety (90) days of such appointment or (h) an appointment
referred to in clause (g) is not vacated within ninety (90) days after the
expiration of any such stay.
"Indemnitee" means (i) any Person subject to a claim or demand
or made or threatened to be made a party to, or involved or threatened to be
involved in, an action, suit or proceeding by reason of his or her status as (a)
the General Partner or (b) a director, officer, employee or agent of the
Partnership or the General Partner and (ii) such other Persons (including
Affiliates of the General Partner or the Partnership) as the General Partner may
designate from time to time, in its sole and absolute discretion.
"IRS" means the Internal Revenue Service, which administers
the internal revenue laws of the United States.
"Junior Units" means Partnership Units representing any class
or series of Partnership Interest ranking, as to distributions or voluntary or
involuntary liquidation, dissolution or winding up of the Partnership, junior to
the Series J Preferred Units, the Series K Preferred Units, the Series L
Preferred Units and the Series M Preferred Units.
"Limited Partner" means any Person (including any PLP) named
as a Limited Partner in Exhibit A attached hereto, as such Exhibit may be
amended from time to time, any Substituted Limited Partner or Additional Limited
Partner, in such Person's capacity as a Limited Partner in the Partnership.
"Limited Partnership Interest" means a Partnership Interest of
a Limited Partner representing a fractional part of the Partnership Interests of
all Limited Partners and includes any and all benefits to which the holder of
such a Partnership Interest may be entitled as provided in this Agreement,
together with all obligations of such Person to comply with the terms and
provisions of this Agreement. A Limited Partnership Interest may be expressed as
a number of Partnership Units.
"Liquidating Events" shall have the meaning set forth in
Section 13.1.
"Liquidator" shall have the meaning set forth in Section
13.2.A.
"Majority in Interest of the Limited Partners" means Limited
Partners (other than the General Partner and any Limited Partner fifty percent
(50%) or more of whose equity is owned, directly or indirectly, by the General
Partner, and any Preferred Limited Partner) holding Percentage Interests that in
the aggregate are greater than fifty percent (50%) of the aggregate Percentage
Interests of all Limited Partners (other than the General Partner and any
Limited Partner fifty percent (50%) or more of whose equity is owned, directly
or indirectly, by the General Partner and any Preferred Limited Partner).
"Majority in Interest of Partners" means Partners (other than
Preferred Limited Partners) holding Percentage Interests that are greater than
fifty percent (50%) of the aggregate Percentage Interests of all Partners (other
than Preferred Limited Partners).
"Net Income" or "Net Loss" means for each fiscal year of the
Partnership, an amount equal to the Partnership's taxable income or loss for
such fiscal year, determined in accordance with Code Section 703(a) (for this
purpose, all items of income, gain, loss or
11
deduction required to be stated separately pursuant to Code Section 703(a)(1)
shall be included in taxable income or loss), with the following adjustments:
(i) Any income of the Partnership that is exempt from
Federal income tax and not otherwise taken into account in computing Net Income
or Net Loss pursuant to this definition of Net Income or Net Loss shall be added
to such taxable income or loss;
(ii) Any expenditures of the Partnership described in Code
Section 705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures
pursuant to Regulations Section 1.704-1(b)(2)(iv)(i), and not otherwise taken
into account in computing Net Income or Net Loss pursuant to this definition of
Net Income or Net Loss shall be subtracted from such taxable income or loss;
(iii) In the event the Gross Asset Value of any Partnership
asset is adjusted pursuant to subparagraph (ii) or (iii) of the definition of
Gross Asset Value, the amount of such adjustment shall be taken into account as
gain or loss from the disposition of such asset for purposes of computing Net
Income or Net Loss; in the event the Gross Asset Value of any Partnership asset
is adjusted pursuant to subparagraph (ii) of the definition of Gross Asset
Value, the amount of such adjustment shall be taken into account as gain or loss
from the disposition of all Partnership assets in a Terminating Capital
Transaction for purposes of computing Net Income or Net Loss as set forth in
Article 6;
(iv) Gain or loss resulting from any disposition of
property with respect to which gain or loss is recognized for Federal income tax
purposes shall be computed by reference to the Gross Asset Value of the property
disposed of, notwithstanding that the adjusted tax basis of such property
differs from its Gross Asset Value;
(v) In lieu of the depreciation, amortization, and other
cost recovery deductions taken into account in computing such taxable income or
loss, there shall be taken into account Depreciation for such fiscal year;
(vi) To the extent an adjustment to the adjusted tax basis
of any Partnership asset pursuant to Code Section 734(b) or Code Section 743(b)
is required pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(4) to be taken
into account in determining Capital Accounts as a result of a distribution other
than in liquidation of a Partner's interest in the Partnership, the amount of
such adjustment shall be treated as an item of gain (if the adjustment increases
the basis of the asset) or loss (if the adjustment decreases the basis of the
asset) from the disposition of the asset and shall be taken into account for
purposes of computing Net Income or Net Loss; and
(vii) Notwithstanding any other provision of this
definition of Net Income or Net Loss, any items which are specially allocated
pursuant to Section 6.3 shall not be taken into account in computing Net Income
or Net Loss. The amounts of the items of Partnership income, gain, loss, or
deduction available to be specially allocated pursuant to Section 6.3 shall be
determined by applying rules analogous to those set forth in this definition of
Net Income or Net Loss.
"New Securities" means (i) any rights, options, warrants or
convertible or exchangeable securities having the right to subscribe for or
purchase REIT Shares or other shares
12
of capital stock of the General Partner, excluding grants under any Stock
Incentive Plan or (ii) any Debt issued by the General Partner that provides any
of the rights described in clause (i).
"Nonrecourse Deductions" shall have the meaning set forth in
Regulations Section 1.704-2(b)(1), and the amount of Nonrecourse Deductions for
a Partnership Year shall be determined in accordance with the rules of
Regulations Section 1.704-2(c).
"Nonrecourse Liability" shall have the meaning set forth in
Regulations Section 1.752-1(a)(2).
"Notice of Redemption" means the Notice of Redemption
substantially in the form of Exhibit B to this Agreement.
"Offering Costs" means the aggregate amounts expended by the
General Partner which related to the organization of the Partnership and the
General Partner, or to the initial public offering or subsequent offerings of
REIT Shares or other shares of capital stock of the General Partner, the net
proceeds of which were used to make a contribution to the Partnership, in each
case to the extent such expenses of the General Partner were not reimbursed by
the Partnership.
"Parity Preferred Unit" means any class or series of
Partnership Interests of the Partnership now or hereafter authorized, issued or
outstanding expressly designated by the Partnership to rank on a parity with the
Series J Preferred Units, the Series K Preferred Units, the Series L Preferred
Units and the Series M 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.
"Partner" means a General Partner or a Limited Partner, and
"Partners" means the General Partner and the Limited Partners.
"Partner Minimum Gain" means an amount, with respect to each
Partner Nonrecourse Debt, equal to the Partnership Minimum Gain that would
result if such Partner Nonrecourse Debt were treated as a Nonrecourse Liability,
determined in accordance with Regulations Section 1.704-2(i)(3).
"Partner Nonrecourse Debt" shall have the meaning set forth in
Regulations Section 1.704-2(b)(4).
"Partner Nonrecourse Deductions" shall have the meaning set
forth in Regulations Section 1.704-2(i)(2), and the amount of Partner
Nonrecourse Deductions with respect to a Partner Nonrecourse Debt for a
Partnership Year shall be determined in accordance with the rules of Regulations
Section 1.704-2(i)(2).
"Partnership" means the limited partnership formed under the
Act and pursuant to this Agreement, and any successor thereto.
"Partnership Interest" means an ownership interest in the
Partnership of either a Limited Partner or the General Partner and includes any
and all benefits to which the holder of such a Partnership Interest may be
entitled as provided in this Agreement, together with all
13
obligations of such Person to comply with the terms and provisions of this
Agreement. There may be one or more classes of Partnership Interests as provided
in Section 4.3. A Partnership Interest may be expressed as a number of
Partnership Units. Unless otherwise expressly provided for by the General
Partner at the time of the original issuance of any Partnership Interests, all
Partnership Interests (whether of a Limited Partner or a General Partner) shall
be of the same class. The Partnership Interests represented by the Common Units
(including Performance Units), the Series J Preferred Units, the Series K
Preferred Units, the Series L Preferred Units and the Series M Preferred Units
are the only Partnership Interests and each such type of unit is a separate
class of Partnership Interest for all purposes of this Agreement.
"Partnership Minimum Gain" shall have the meaning set forth in
Regulations Section 1.704-2(b)(2), and the amount of Partnership Minimum Gain,
as well as any net increase or decrease in Partnership Minimum Gain, for a
Partnership Year shall be determined in accordance with the rules of Regulations
Section 1.704-2(d).
"Partnership Record Date" means the record date established by
the General Partner for the distribution of Available Cash with respect to
Common Units pursuant to Section 5.1 which record date shall be the same as the
record date established by the General Partner for a distribution to its
stockholders of some or all of its portion of such distribution.
"Partnership Unit" means, with respect to any class of
Partnership Interest, a fractional, undivided share of such class of Partnership
Interest issued pursuant to Sections 4.1 and 4.3 (including Performance Units).
The ownership of Partnership Units may be evidenced by a certificate for units
substantially in the form of Exhibit D-1 or D-2 hereto or as the General Partner
may determine with respect to any class of Partnership Units issued from time to
time under Sections 4.1 and 4.3.
"Partnership Year" means the fiscal year of the Partnership,
which shall be the calendar year.
"Percentage Interest" means, as to a Partner holding a class
of Partnership Interests, its interest in the Partnership as determined by
dividing the Partnership Units of such class owned by such Partner by the total
number of Partnership Units of such class then outstanding as specified in
Exhibit A attached hereto, as such Exhibit may be amended from time to time. If
the Partnership issues more than one class of Partnership Interest, the interest
in the Partnership among the classes of Partnership Interests shall be
determined as set forth in the amendment to the Partnership Agreement setting
forth the rights and privileges of such additional classes of Partnership
Interest, if any, as contemplated by Section 4.3.C.
"Performance Amount" means, with respect to a PLP on a
specified date, (i) in the case of a Redemption, a number of Performance Units
equal to (a) the amount of such PLP's Capital Account balance immediately
following the revaluation of the Partnership's assets as of such date pursuant
to the definitions of "Gross Asset Value" (paragraph (ii) therein) and "Net
Income" (paragraph (iii) therein), divided by (b) the Fair Market Value of a
REIT Share; and (ii) in the case of an exchange of Performance Units for the
REIT Shares Amount, the same number of Performance Units as determined pursuant
to subparagraph (i) above.
14
"Performance Investors" means shareholders of the General
Partner and Limited Partners who are parties to one or more of the Escrow
Agreements.
"Performance Partners" means Partners which had the number of
their Partnership Units reduced pursuant to Section 4.3.F.
"Performance Shares" means a portion of the REIT Shares or
Partnership Units issued to the Performance Investors which were escrowed
pursuant to the Escrow Agreements for possible transfer to the General Partner
or the Partnership (as applicable), the applicable number of which for each
Performance Investor is described in the applicable Escrow Agreement.
"Performance Units" means those Partnership Units issued
pursuant to Section 4.3.F.
"Permitted Reason" means a termination of employment by reason
of death, disability, termination by the employer without "cause," or
termination by a Person of their employment for "good reason." For purposes of
this definition, "cause" shall mean (i) gross negligence or willful misconduct,
(ii) breach by the Person of the covenant not to compete provided in their
employment agreement during the one year period following the closing of the
initial public offering of common stock of the General Partner, (iii) fraud or
other conduct against the material best interests of the General Partner, the
Partnership or their subsidiaries, or (iv) conviction of a felony if such
conviction has a material adverse effect on the General Partner, the Partnership
or their subsidiaries. For purposes of this definition, "good reason" means (a)
a substantial adverse change in the nature or scope of a Person's
responsibilities or authority under the Person's employment agreement, or (b) an
uncured breach by the employer of any of its material obligations under such
employment agreement.
"Person" means an individual or a corporation, partnership,
limited liability company, trust, unincorporated organization, association or
other entity.
"Plan Asset Regulation" means the regulations promulgated by
the United States Department of Labor in Title 29, Code of Federal Regulations,
Part 2510, Section 101-3, and any successor regulations thereto.
"Pledge" shall have the meaning set forth in Section 11.3.A.
"PLP" means at any time, any Person who then owns one or more
Performance Units, including Performance Units which have not vested.
"Preferred Distribution Shortfall" shall have the meaning
given to such term in Section 5.1 hereof.
"Preferred Limited Partner" means any Person holding a
Preferred Unit, and named as a Preferred Limited Partner in Exhibit A attached
hereto, as such Exhibit may be amended from time to time, or any Substitute
Limited Partner or Additional Limited Partner, in such Person's capacity as a
Preferred Limited Partner in the Partnership.
15
"Preferred Share" means a share of the General Partner's
preferred stock, par value $.01 per share, with such rights, priorities and
preferences as shall be designated by the Board of Directors in accordance with
the Charter.
"Preferred Unit" means a Partnership Unit representing a
Partnership Interest, with such rights, priorities and preferences as shall be
designated by the General Partner pursuant to Section 4.3.C hereof, including
without limitation, the Series J Preferred Units, the Series K Preferred Units,
the Series L Preferred Units and the Series M Preferred Units.
"Priority Return" means with respect to (i) the Series J
Preferred Units, the Series J Priority Return, (ii) the Series K Preferred
Units, the Series K Priority Return, (iii) the Series L Preferred Units, the
Series L Priority Return, and (iv) the Series M Preferred Units, the Series M
Priority Return.
"Properties" means such interests in real property and
personal property including without limitation, fee interests, interests in
ground leases, interests in joint ventures, interests in mortgages, and Debt
instruments as the Partnership may hold from time to time.
"Qualified REIT Subsidiary" means any Subsidiary of the
General Partner that is a "qualified REIT subsidiary" within the meaning of
Section 856(i) of the Code.
"Qualified Transferee" means an "Accredited Investor" as
defined in Rule 501 promulgated under the Securities Act.
"Redemption" shall have the meaning set forth in Section
8.6.A.
"Regulations" means the Income Tax Regulations promulgated
under the Code, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).
"Regulatory Allocations" shall have the meaning set forth in
Section 6.3.A(viii).
"REIT" means a real estate investment trust under Sections 856
through 860 of the Code.
"REIT Requirements" shall have the meaning set forth in
Section 5.1.
"REIT Share" means a share of common stock, par value $.01 per
share, of the General Partner.
"REIT Shares Amount" means, as of any date, an aggregate
number of REIT Shares equal to the number of Tendered Units, or in the case of
Section 11.2.B, all Units, as adjusted pursuant to Section 7.5 (in the event the
General Partner acquires material assets, other than on behalf of the
Partnership) and for stock dividends and distributions, stock splits and
subdivisions, reverse stock splits and combinations, distributions of rights,
warrants or options, and distributions of evidences of indebtedness or assets
relating to assets not received by the General Partner pursuant to a pro rata
distribution by the Partnership.
16
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
"Series J Articles Supplementary" means the Articles
Supplementary of the General Partner in connection with its Series J Preferred
Shares, as filed with the Maryland Department of Assessments and Taxation on
September 24, 2001.
"Series J Limited Partner" means any Person holding Series J
Preferred Units and named as a Series J Limited Partner in Exhibit A attached
hereto, as such Exhibit may be amended from time to time, or any Substitute
Limited Partner, in such Person's capacity as a Limited Partner in the
Partnership.
"Series J Preferred Capital" means a Capital Account balance
equal to the product of (i) the number of Series J Preferred Units then held by
the Partner multiplied by (ii) the sum of $50 and any Preferred Distribution
Shortfall per Series J Preferred Unit.
"Series J Preferred Share" means a share of 7.95% Series J
Cumulative Redeemable Preferred Stock, par value $.01 per share, liquidation
preference $50 per share, of the General Partner.
"Series J Preferred Units" means the Partnership's 7.95%
Series J Cumulative Redeemable Partnership Units.
"Series J Preferred Unit Distribution Payment Date" shall have
the meaning set forth in Section 18.3.A hereof.
"Series J Priority Return" shall mean an amount equal to 7.95%
per annum on an amount equal to $50 per Series J Preferred Unit then outstanding
(equivalent to $3.975 per annum). Such amount shall be determined on a daily
basis computed on the basis of a 360-day year of twelve 30-day months (or actual
days for any month which is shorter than a full monthly period), cumulative from
September 21, 2001 to the extent not distributed for any given distribution
period pursuant to Sections 5.1 and 18.3 hereof. Notwithstanding the foregoing,
distributions on the Series J Preferred Units will accrue whether or not the
terms and provisions of any agreement of the Partnership at any time prohibit
the current payment of distributions, whether or not the Partnership has
earnings, whether or not there are funds legally available for the payment of
such distributions and whether or not such distributions are authorized. Accrued
but unpaid distributions on the Series J Preferred Units will accumulate as of
the Preferred Unit Distribution Payment Date on which they first become payable.
"Series K Articles Supplementary" means the Articles
Supplementary of the General Partner in connection with its Series K Preferred
Shares, as filed with the Maryland Department of Assessments and Taxation on
April 17, 2002.
"Series K Limited Partner" means any Person holding Series K
Preferred Units and named as a Series K Limited Partner in Exhibit A attached
hereto, as such Exhibit may be amended from time to time, or any Substitute
Limited Partner, in such Person's capacity as a Limited Partner in the
Partnership.
17
"Series K Preferred Capital" means a Capital Account balance
equal to the product of (i) the number of Series K Preferred Units then held by
the Partner multiplied by (ii) the sum of $50 and any Preferred Distribution
Shortfall per Series K Preferred Unit.
"Series K Preferred Share" means a share of 7.95% Series K
Cumulative Redeemable Preferred Stock, par value $.01 per share, liquidation
preference $50 per share, of the General Partner.
"Series K Preferred Units" means the Partnership's 7.95%
Series K Cumulative Redeemable Partnership Units.
"Series K Preferred Unit Distribution Payment Date" shall have
the meaning set forth in Section 19.3.A hereof.
"Series K Priority Return" shall mean an amount equal to 7.95%
per annum on an amount equal to $50 per Series K Preferred Unit then outstanding
(equivalent to $3.975 per annum). Such amount shall be determined on a daily
basis computed on the basis of a 360-day year of twelve 30-day months (or actual
days for any month which is shorter than a full monthly period), cumulative from
April 17, 2002 to the extent not distributed for any given distribution period
pursuant to Sections 5.1 and 19.3 hereof. Notwithstanding the foregoing,
distributions on the Series K Preferred Units will accrue whether or not the
terms and provisions of any agreement of the Partnership at any time prohibit
the current payment of distributions, whether or not the Partnership has
earnings, whether or not there are funds legally available for the payment of
such distributions and whether or not such distributions are authorized. Accrued
but unpaid distributions on the Series K Preferred Units will accumulate as of
the Preferred Unit Distribution Payment Date on which they first become payable.
"Series L Articles Supplementary" means the Articles
Supplementary of the General Partner in connection with its Series L Preferred
Shares, as filed with the Maryland Department of Assessments and Taxation on
June 20, 2003.
"Series L Preferred Capital" means a Capital Account balance
equal to the product of (i) the number of Series L Preferred Units then held by
the Partner multiplied by (ii) the sum of $25 and any Preferred Distribution
Shortfall per Series L Preferred Unit.
"Series L Preferred Share" means a share of 6 1/2% Series L
Cumulative Redeemable Preferred Stock, par value $.01 per share, liquidation
preference $25 per share, of the General Partner.
"Series L Preferred Units" means the Partnership's 6 1/2%
Series L Cumulative Redeemable Partnership Units.
"Series L Preferred Unit Distribution Payment Date" shall have
the meaning set forth in Section 20.3.A hereof.
"Series L Priority Return" shall mean an amount equal to 6
1/2% per annum on an amount equal to $25 per Series L Preferred Unit then
outstanding (equivalent to $1.625 per annum). Such amount shall be determined on
a daily basis computed on the basis of a 360-day year of twelve 30-day months
(or actual days for any month which is shorter than a full monthly
18
period), cumulative from June 23, 2003 to the extent not distributed for any
given distribution period pursuant to Sections 5.1 and 20.3 hereof.
Notwithstanding the foregoing, distributions on the Series L Preferred Units
will accrue whether or not the terms and provisions of any agreement of the
Partnership at any time prohibit the current payment of distributions, whether
or not the Partnership has earnings, whether or not there are funds legally
available for the payment of such distributions and whether or not such
distributions are authorized. Accrued but unpaid distributions on the Series L
Preferred Units will accumulate as of the Preferred Unit Distribution Payment
Date on which they first become payable.
"Series M Articles Supplementary" means the Articles
Supplementary of the General Partner in connection with its Series M Preferred
Shares, as filed with the Maryland Department of Assessments and Taxation on
November 24, 2003.
"Series M Preferred Capital" means a Capital Account balance
equal to the product of (i) the number of Series M Preferred Units then held by
the Partner multiplied by (ii) the sum of $25 and any Preferred Distribution
Shortfall per Series M Preferred Unit.
"Series M Preferred Share" means a share of 6 3/4% Series M
Cumulative Redeemable Preferred Stock, par value $.01 per share, liquidation
preference $25 per share, of the General Partner.
"Series M Preferred Units" means the Partnership's 6 3/4%
Series M Cumulative Redeemable Partnership Units.
"Series M Preferred Unit Distribution Payment Date" shall have
the meaning set forth in Section 21.3.A hereof.
"Series M Priority Return" shall mean an amount equal to 6
3/4% per annum on an amount equal to $25 per Series M Preferred Unit then
outstanding (equivalent to $1.6875 per annum). Such amount shall be determined
on a daily basis computed on the basis of a 360-day year of twelve 30-day months
(or actual days for any month which is shorter than a full monthly period),
cumulative from November 25, 2003 to the extent not distributed for any given
distribution period pursuant to Sections 5.1 and 21.3 hereof. Notwithstanding
the foregoing, distributions on the Series M Preferred Units will accrue whether
or not the terms and provisions of any agreement of the Partnership at any time
prohibit the current payment of distributions, whether or not the Partnership
has earnings, whether or not there are funds legally available for the payment
of such distributions and whether or not such distributions are authorized.
Accrued but unpaid distributions on the Series M Preferred Units will accumulate
as of the Preferred Unit Distribution Payment Date on which they first become
payable.
"Specified Redemption Date" means the day of receipt by the
General Partner of a Notice of Redemption.
"Stock Incentive Plan" means any stock incentive plan of the
General Partner.
"Subsidiary" shall mean, with respect to any person, any
corporation, partnership, limited liability company, joint venture or other
entity of which a majority of (i) the voting power of the voting equity
securities or (ii) the outstanding equity interests, is owned, directly or
indirectly, by such person.
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"Subsidiary Partnership" means any partnership or limited
liability company that is a Subsidiary of the Partnership.
"Substituted Limited Partner" means a Person who is admitted
as a Limited Partner to the Partnership pursuant to Section 11.4.
"Surviving Partnership" shall have the meaning set forth in
Section 11.2.C.
"Tax Items" shall have the meaning set forth in Section 6.4.A.
"Tenant" means any tenant from which the General Partner
derives rent either directly or indirectly through partnerships, including the
Partnership.
"Tendered Units" shall have the meaning set forth in Section
8.6.A.
"Tendering Partner" shall have the meaning set forth in
Section 8.6.A.
"Terminating Capital Transaction" means any sale or other
disposition of all or substantially all of the assets of the Partnership or a
related series of transactions that, taken together, result in the sale or other
disposition of all or substantially all of the assets of the Partnership.
"Termination Transaction" shall have the meaning set forth in
Section 11.2.B.
Section 1.2 Rules of Construction
Unless otherwise indicated, all references herein to "REIT,"
"REIT Requirements," "REIT Shares" and "REIT Shares Amount" with respect to the
General Partner shall apply only with reference to the Company.
ARTICLE 2.
ORGANIZATIONAL MATTERS
Section 2.1 Organization
The Partnership is a limited partnership formed pursuant to
the provisions of the Act and upon the terms and conditions set forth in this
Agreement. Except as expressly provided herein, the rights and obligations of
the Partners and the administration and termination of the Partnership shall be
governed by the Act. The Partnership Interest of each Partner shall be personal
property for all purposes.
Section 2.2 Name
The name of the Partnership is AMB Property, L.P. The
Partnership's business may be conducted under any other name or names deemed
advisable by the General Partner, including the name of the General Partner or
any Affiliate thereof. The words "Limited Partnership," "L.P.," "Ltd." or
similar words or letters shall be included in the Partnership's name where
necessary for the purposes of complying with the laws of any jurisdiction that
so requires. The General Partner in its sole and absolute discretion may change
the name of the
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Partnership at any time and from time to time and shall notify
the Limited Partners of such change in the next regular communication to the
Limited Partners.
Section 2.3 Resident Agent; Principal Office
The name and address of the resident agent of the Partnership
in the State of Delaware is Corporation Service Company, 0000 Xxxxxxxxxxx Xxxx,
Xxxxx 000, Xxxxxxxxxx, Xxxxxxxx 00000. The address of the principal office of
the Partnership in the State of Delaware is Corporation Service Company, 0000
Xxxxxxxxxxx Xxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxxx 00000 at such address. The
principal office of the Partnership is located at Xxxx 0, Xxx 0, Xxx Xxxxxxxxx,
Xxxxxxxxxx 00000, or such other place as the General Partner may from time to
time designate by notice to the Limited Partners. The Partnership may maintain
offices at such other place or places within or outside the State of Delaware as
the General Partner deems advisable.
Section 2.4 Power of Attorney
A. Each Limited Partner and each Assignee constitutes
and appoints the General Partner, any Liquidator, and authorized officers and
attorneys-in-fact of each, and each of those acting singly, in each case with
full power of substitution, as its true and lawful agent and attorney-in-fact,
with full power and authority in its name, place and stead to:
(i) execute, swear to, acknowledge, deliver, file and
record in the appropriate public offices: (a) all
certificates, documents and other instruments
(including, without limitation, this Agreement and
the Certificate and all amendments or restatements
thereof) that the General Partner or the Liquidator
deems appropriate or necessary to form, qualify or
continue the existence or qualification of the
Partnership as a limited partnership (or a
partnership in which the Limited Partners have
limited liability) in the State of Delaware and in
all other jurisdictions in which the Partnership may
conduct business or own property; (b) all instruments
that the General Partner or any Liquidator deems
appropriate or necessary to reflect any amendment,
change, modification or restatement of this Agreement
in accordance with its terms; (c) all conveyances and
other instruments or documents that the General
Partner or any Liquidator deems appropriate or
necessary to reflect the dissolution and liquidation
of the Partnership pursuant to the terms of this
Agreement, including, without limitation, a
certificate of cancellation; (d) all instruments
relating to the admission, withdrawal, removal or
substitution of any Partner pursuant to, or other
events described in, Articles 11, 12 and 13 or the
Capital Contribution of any Partner; and (e) all
certificates, documents and other instruments
relating to the determination of the rights,
preferences and privileges of Partnership Interests;
and
(ii) execute, swear to, acknowledge and file all ballots,
consents, approvals, waivers, certificates and other
instruments appropriate or necessary, in the sole and
absolute discretion of the General Partner or any
Liquidator, to make, evidence, give, confirm or
ratify any vote, consent, approval,
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agreement or other action which is made or given by
the Partners hereunder or is consistent with the
terms of this Agreement or appropriate or necessary,
in the sole discretion of the General Partner or any
Liquidator, to effectuate the terms or intent of this
Agreement.
Nothing contained herein shall be construed as authorizing the General Partner
or any Liquidator to amend this Agreement except in accordance with Article 14
or as may be otherwise expressly provided for in this Agreement.
B. The foregoing power of attorney is hereby declared to
be irrevocable and a power coupled with an interest, in recognition of the fact
that each of the Partners will be relying upon the power of the General Partner
and any Liquidator to act as contemplated by this Agreement in any filing or
other action by it on behalf of the Partnership, and it shall survive and not be
affected by the subsequent Incapacity of any Limited Partner or Assignee and the
transfer of all or any portion of such Limited Partner's or Assignee's
Partnership Units and shall extend to such Limited Partner's or Assignee's
heirs, successors, assigns and personal representatives. Each such Limited
Partner or Assignee hereby agrees to be bound by any representation made by the
General Partner or any Liquidator, acting in good faith pursuant to such power
of attorney; and each such Limited Partner or Assignee hereby waives any and all
defenses which may be available to contest, negate or disaffirm the action of
the General Partner or any Liquidator, taken in good faith under such power of
attorney. Each Limited Partner or Assignee shall execute and deliver to the
General Partner or any Liquidator, within fifteen (15) days after receipt of the
General Partner's or Liquidator's request therefor, such further designation,
powers of attorney and other instruments as the General Partner or the
Liquidator, as the case may be, deems necessary to effectuate this Agreement and
the purposes of the Partnership.
Section 2.5 Term
The term of the Partnership commenced on October 15, 1997 and
shall continue until December 31, 2096 unless it is dissolved sooner pursuant to
the provisions of Article 13 or as otherwise provided by law.
Section 2.6 Number of Partners
Without the consent of the General Partner which may be given
or withheld in its sole discretion, the Partnership shall not at any time have
more than one hundred (100) partners (including as partners those persons
indirectly owning an interest in the Partnership through a partnership, limited
liability company, S corporation or grantor trust (such entity, a "flow through
entity"), but only if substantially all of the value of such person's interest
in the flow through entity is attributable to the flow through entity's interest
(direct or indirect) in the Partnership).
ARTICLE 3.
PURPOSE
Section 3.1 Purpose and Business
The purpose and nature of the business to be conducted by the
Partnership is (i) to conduct any business that may be lawfully conducted by a
limited partnership organized
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pursuant to the Act; provided, however, that such business shall be limited to
and conducted in such a manner as to permit the General Partner at all times to
be classified as a REIT for Federal income tax purposes, unless the General
Partner ceases to qualify as a REIT for reasons other than the conduct of the
business of the Partnership, (ii) to enter into any partnership, joint venture
or other similar arrangement to engage in any of the foregoing or to own
interests in any entity engaged, directly or indirectly, in any of the foregoing
and (iii) to do anything necessary or incidental to the foregoing. In connection
with the foregoing, and without limiting the General Partner's right in its sole
discretion to cease qualifying as a REIT, the Partners acknowledge that the
General Partner's current status as a REIT inures to the benefit of all the
Partners and not solely the General Partner.
Section 3.2 Powers
The Partnership is empowered to do any and all acts and things
necessary, appropriate, proper, advisable, incidental to or convenient for the
furtherance and accomplishment of the purposes and business described herein and
for the protection and benefit of the Partnership, including, without
limitation, full power and authority, directly or through its ownership interest
in other entities, to enter into, perform and carry out contracts of any kind,
borrow money and issue evidences of indebtedness, whether or not secured by
mortgage, deed of trust, pledge or other lien, acquire and develop real
property, and manage, lease, sell, transfer and dispose of real property;
provided, however, not withstanding anything to the contrary in this Agreement,
the Partnership shall not take, or refrain from taking, any action which, in the
judgment of the General Partner, in its sole and absolute discretion, (i) could
adversely affect the ability of the General Partner to continue to qualify as a
REIT, (ii) absent the consent of the General Partner, which may be given or
withheld in its sole and absolute discretion, and except with respect to the
distribution of Available Cash to the Series J Limited Partners in accordance
with Section 18.3 and the Series K Limited Partners in accordance with Section
19.3, could subject the General Partner to any taxes under Section 857 or
Section 4981 of the Code, or (iii) could violate any law or regulation of any
governmental body or agency having jurisdiction over the General Partner or its
securities, unless any such action (or inaction) under the foregoing clauses
(i), (ii) or (iii) shall have been specifically consented to by the General
Partner in writing.
Section 3.3 Partnership Only for Purposes Specified
The Partnership shall be a partnership only for the purposes
specified in Section 3.1, and this Agreement shall not be deemed to create a
partnership among the Partners with respect to any activities whatsoever other
than the activities within the purposes of the Partnership as specified in
Section 3.1. Except as otherwise provided in this Agreement, no Partner shall
have any authority to act for, bind, commit or assume any obligation or
responsibility on behalf of the Partnership, its properties or any other
Partner. No Partner, in its capacity as a Partner under this Agreement, shall be
responsible or liable for any indebtedness or obligation of another Partner, nor
shall the Partnership be responsible or liable for any indebtedness or
obligation of any Partner, incurred either before or after the execution and
delivery of this Agreement by such Partner, except as to those responsibilities,
liabilities, indebtedness or obligations incurred pursuant to and as limited by
the terms of this Agreement and the Act.
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Section 3.4 Representations and Warranties by the Parties
A. Each Partner that is an individual represents and
warrants to each other Partner that (i) such Partner has in the case of any
Person other than an individual, the power and authority, and in the case of an
individual, the legal capacity, to enter into this Agreement and perform such
Partner's obligations hereunder, (ii) the consummation of the transactions
contemplated by this Agreement to be performed by such Partner will not result
in a breach or violation of, or a default under, any agreement by which such
Partner or any of such Partner's property is or are bound, or any statute,
regulation, order or other law to which such Partner is subject, (iii) such
Partner is neither a "foreign person" within the meaning of Section 1445(f) of
the Code nor a "foreign partner" within the meaning of Section 1446(e) of the
Code and (iv) this Agreement has been duly executed and delivered by such
Partner and is binding upon, and enforceable against, such Partner in accordance
with its terms.
B. Each Partner that is not an individual represents and
warrants to each other Partner that (i) its execution and delivery of this
Agreement and all transactions contemplated by this Agreement to be performed by
it have been duly authorized by all necessary action, including without
limitation, that of its general partner(s), committee(s), trustee(s),
beneficiaries, directors and/or stockholder(s), as the case may be, as required,
(ii) the consummation of such transactions shall not result in a breach or
violation of, or a default under, its certificate of limited partnership,
partnership agreement, trust agreement, limited liability company operating
agreement, charter or by-laws, as the case may be, any agreement by which such
Partner or any of such Partner's properties or any of its partners,
beneficiaries, trustees or stockholders, as the case may be, is or are bound, or
any statute, regulation, order or other law to which such Partner or any of its
partners, trustees, beneficiaries or stockholders, as the case may be, is or are
subject, (iii) such Partner is neither a "foreign person" within the meaning of
Section 1445(f) of the Code nor a "foreign partner" within the meaning of
Section 1446(e) of the Code and (iv) this Agreement has been duly executed and
delivered by such Partner and is binding upon, and enforceable against, such
Partner in accordance with its terms.
C. Each Partner represents, warrants and agrees that it
has acquired and continues to hold its interest in the Partnership for its own
account for investment only and not for the purpose of, or with a view toward,
the resale or distribution of all or any part thereof, nor with a view toward
selling or otherwise distributing such interest or any part thereof at any
particular time or under any predetermined circumstances. Each Partner further
represents and warrants that it is a sophisticated investor, able and accustomed
to handling sophisticated financial matters for itself, particularly real estate
investments, and that it has a sufficiently high net worth that it does not
anticipate a need for the funds it has invested in the Partnership in what it
understands to be a highly speculative and illiquid investment.
D. Each Partner further represents, warrants and agrees
as follows:
(i) Except as provided in Exhibit E, at any time
such Partner actually or Constructively Owns a 25% or greater capital
interest or profits interest in the Partnership, it does not and will
not, without the prior written consent of the General Partner, actually
own or Constructively Own (a) with respect to any Tenant that is a
corporation, any stock of such Tenant and (b) with respect to any
Tenant that is not a corporation, any interests in either the assets or
net profits of such Tenant.
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(ii) Except as provided in Exhibit F, at any time
such Partner actually or Constructively Owns a 25% or greater capital
interest or profits interest in the Partnership, it does not, and
agrees that it will not without the prior written consent of the
General Partner, actually own or Constructively Own, any stock in the
General Partner, other than any REIT Shares or other shares of capital
stock of the General Partner such Partner may acquire (a) as a result
of an exchange of Tendered Units pursuant to Section 8.6 or (b) upon
the exercise of options granted or delivery of REIT Shares pursuant to
any Stock Incentive Plan, in each case subject to the ownership
limitations set forth in the General Partner's Charter.
(iii) Upon request of the General Partner, it will
disclose to the General Partner the amount of REIT Shares or other
shares of capital stock of the General Partner that it actually owns or
Constructively Owns.
(iv) It understands that if, for any reason, (a)
the representations, warranties or agreements set forth in Section
3.4.D(i) or (ii) are violated or (b) the Partnership's actual or
Constructive Ownership of the REIT Shares or other shares of capital
stock of the General Partner violates the limitations set forth in the
Charter, then (x) some or all of the Redemption rights or rights of the
Limited Partners to exchange Partnership Interests for Series J
Preferred Shares or for Series K Preferred Shares may become
non-exercisable, and (y) some or all of such shares owned by the
Partners and/or some or all of the Partnership Interests owned by the
Limited Partners may be automatically transferred to a trust for the
benefit of a charitable beneficiary, as provided in the Charter and
Exhibit J of this Agreement, respectively.
E. The representations and warranties contained in
Sections 3.4.A, 3.4.B, 3.4.C and 3.4.D shall survive the execution and delivery
of this Agreement by each Partner and the dissolution and winding up of the
Partnership.
F. Each Partner hereby acknowledges that no
representations as to potential profit, cash flows, funds from operations or
yield, if any, in respect of the Partnership or the General Partner have been
made by any Partner or any employee or representative or Affiliate of any
Partner, and that projections and any other information, including, without
limitation, financial and descriptive information and documentation, which may
have been in any manner submitted to such Partner shall not constitute any
representation or warranty of any kind or nature, express or implied.
Section 3.5 Certain ERISA Matters
Each Partner acknowledges that the Partnership is intended to
qualify as a "real estate operating company" (as such term is defined in the
Plan Asset Regulation). The General Partner will use its reasonable best efforts
to structure the investments in, relationships with and conduct with respect to
Properties and any other assets of the Partnership so that the Partnership will
be a "real estate operating company" (as such term is defined in the Plan Asset
Regulation).
25
ARTICLE 4.
CAPITAL CONTRIBUTIONS
Section 4.1 Capital Contributions of the Partners
At the time of their respective execution of this Agreement,
the Partners shall make or shall have made Capital Contributions as set forth in
Exhibit A to this Agreement. The Partners shall own Partnership Units of the
class and in the amounts set forth in Exhibit A and shall have a Percentage
Interest in the Partnership as set forth in Exhibit A, which Percentage Interest
shall be adjusted in Exhibit A from time to time by the General Partner to the
extent necessary to accurately reflect exchanges, redemptions, Capital
Contributions, the issuance of additional Partnership Units (including the
issuance of Performance Units pursuant to Section 4.3.F) or similar events
having an effect on a Partner's Percentage Interest. Except as required by law
or as otherwise provided in Sections 4.3, 4.4 and 10.5, no Partner shall be
required or permitted to make any additional Capital Contributions or loans to
the Partnership. Unless otherwise specified by the General Partner at the time
of the creation of any class of Partnership Interests, the corresponding class
of capital stock for any Partnership Units issued shall be REIT Shares.
Section 4.2 Loans by Third Parties
Subject to Section 4.3, the Partnership may incur Debt, or
enter into other similar credit, guarantee, financing or refinancing
arrangements for any purpose (including, without limitation, in connection with
any further acquisition of Properties) with any Person that is not the General
Partner upon such terms as the General Partner determines appropriate; provided,
that the Partnership shall not incur any Debt that is recourse to the General
Partner, except to the extent otherwise agreed to by the General Partner in its
sole discretion.
Section 4.3 Additional Funding and Capital Contributions
A. General. The General Partner may, at any time and
from time to time, determine that the Partnership requires additional funds
("Additional Funds") for the acquisition of additional Properties or for such
other Partnership purposes as the General Partner may determine. Additional
Funds may be raised by the Partnership, at the election of the General Partner,
in any manner provided in, and in accordance with, the terms of this Section
4.3. No Person shall have any preemptive, preferential or similar right or
rights to subscribe for or acquire any Partnership Interest, except as set forth
in this Section 4.3.
B. General Partner Loans. The General Partner may enter
into a Funding Debt, including, without limitation, Funding Debt that is
convertible into REIT Shares, and lend the Additional Funds to the Partnership
(a "General Partner Loan"); provided, however, that the General Partner shall
not be obligated to lend the net proceeds of any Funding Debt to the Partnership
in a manner that would be inconsistent with the General Partner's ability to
remain qualified as a REIT. If the General Partner enters into such a Funding
Debt, the General Partner Loan will consist of the net proceeds from such
Funding Debt and will be on comparable terms and conditions, including interest
rate, repayment schedule and costs and expenses, as shall be applicable with
respect to or incurred in connection with such Funding Debt.
26
C. Issuance of Additional Partnership Interests. The
General Partner may raise all or any portion of the Additional Funds by
accepting additional Capital Contributions of cash. The General Partner may also
accept additional Capital Contributions of real property or other non-cash
assets. In connection with any such additional Capital Contributions (of cash or
property), and subject to Sections 18.6 and 19.6 hereof, the General Partner is
hereby authorized to cause the Partnership from time to time to issue to
Partners (including the General Partner) or other Persons (including, without
limitation, in connection with the contribution of property to the Partnership)
additional Partnership Units or other Partnership Interests in one or more
classes, or one or more series of any of such classes, with such designations,
preferences and relative, participating, optional or other special rights,
powers, and duties, including rights, powers, and duties senior to then existing
Limited Partnership Interests, all as shall be determined by the General Partner
in its sole and absolute discretion subject to Delaware law, and as set forth by
amendment to this Agreement, including without limitation: (i) the allocations
of items of Partnership income, gain, loss, deduction, and credit to such class
or series of Partnership Interests; (ii) the right of each such class or series
of Partnership Interests to share in Partnership distributions; (iii) the rights
of each such class or series of Partnership Interests upon dissolution and
liquidation of the Partnership; and (iv) the right to vote, including, without
limitation, the limited partner approval rights set forth in Section 11.2.A;
provided, that no such additional Partnership Units or other Partnership
Interests shall be issued to the General Partner unless either (a) the
additional Partnership Interests are issued in connection with the grant, award,
or issuance of shares of the General Partner pursuant to Section 4.3.D below,
which shares have designations, preferences, and other rights (except voting
rights) such that the economic interests attributable to such shares are
substantially similar to the designations, preferences and other rights of the
additional Partnership Interests issued to the General Partner in accordance
with this Section 4.3.C or (b) the additional Partnership Interests are issued
to all Partners holding Partnership Interests in the same class in proportion to
their respective Percentage Interests in such class. In the event that the
Partnership issues additional Partnership Interests pursuant to this Section
4.3.C, the General Partner shall make such revisions to this Agreement
(including but not limited to the revisions described in Sections 5.4, 6.2.C,
and 8.6) as it determines are necessary to reflect the issuance of such
additional Partnership Interests.
D. Issuance of REIT Shares or Other Securities by the
General Partner. The General Partner shall not issue any additional REIT Shares
(other than REIT Shares issued pursuant to Section 8.6 or pursuant to a dividend
or distribution (including any stock split) of REIT Shares to all of its
stockholders or all of its stockholders who hold a class of stock of the General
Partner), other shares of capital stock of the General Partner (other than in
connection with the acquisition of Partnership Interests in exchange for capital
stock of the General Partner which corresponds in ranking to the Partnership's
Partnership Interests being acquired) or New Securities unless the General
Partner shall make a Capital Contribution of the net proceeds (including,
without limitation, cash and Properties) from the issuance of such additional
REIT Shares, other shares of capital stock or New Securities, as the case may
be, and from the exercise of the rights contained in such additional New
Securities, as the case may be. The General Partner's Capital Account shall be
increased by the amount of cash or the value of Properties so contributed.
E. Percentage Interest Adjustments in the Case of
Capital Contributions for Partnership Units. Upon the acceptance of additional
Capital Contributions in exchange for any class or series of Partnership Units,
the Percentage Interest related thereto shall be equal to a
27
fraction, the numerator of which is equal to the amount of cash and the Agreed
Value of the Properties contributed as of the Business Day immediately preceding
the date on which the additional Capital Contributions are made (an "Adjustment
Date") and the denominator of which is equal to the sum of (i) the Deemed Value
of the Partnership Interests of such class or series (computed as of the
Business Day immediately preceding the Adjustment Date) plus (ii) the aggregate
amount of cash and the Agreed Value of the Property contributed to the
Partnership on such Adjustment Date in respect of such class or series of
Partnership Interests. The Percentage Interest of each other Partner holding
Partnership Interests of such class or series not making a full pro rata Capital
Contribution shall be adjusted to equal a fraction, the numerator of which is
equal to the sum of (i) the Deemed Partnership Interest Value of such Limited
Partner in respect of such class or series (computed as of the Business Day
immediately preceding the Adjustment Date) plus (ii) the amount of cash and the
Agreed Value of the Property contributed by such Partner to the Partnership in
respect of such class or series as of such Adjustment Date, and the denominator
of which is equal to the sum of (a) the Deemed Value of the Partnership
Interests of such class (computed as of the Business Day immediately preceding
the Adjustment Date), plus (b) the aggregate amount of cash and the Agreed Value
of the Property contributed to the Partnership on such Adjustment Date in
respect of such class or series. Notwithstanding the foregoing, solely for
purposes of calculating a Partner's Percentage Interest pursuant to this Section
4.3.E, (i) in the case of cash Capital Contributions by the General Partner,
such Capital Contributions will be deemed to equal the cash contributed by the
General Partner plus, in the case of cash contributions funded by an offering of
REIT Shares or other shares of capital stock of the General Partner, the
offering costs attributable to the cash contributed to the Partnership, and (ii)
in the case of the contribution of Properties (or any portion thereof) by the
General Partner which were acquired by the General Partner in exchange for REIT
Shares immediately prior to such contribution, the General Partner shall be
issued a number of Partnership Units equal to the number of REIT Shares issued
by the General Partner in exchange for such Properties, the Partnership Units
held by the other Partners shall not be adjusted, and the Partners' Percentage
Interests shall be adjusted accordingly. The General Partner shall promptly give
each Partner written notice of its Percentage Interest, as adjusted.
F. Issuance of Performance Units to the PLPs. Pursuant
to the terms of the Escrow Agreements, Performance Investors have transferred
all or a portion of their Performance Shares to the General Partner or the
Partnership (as applicable). To the extent Performance Shares (i.e., REIT
Shares) were transferred by Performance Investors to the General Partner
pursuant to the Escrow Agreements, the number of Partnership Units held by the
General Partner were automatically reduced by such amount on such date. To the
extent Performance Shares (i.e., Partnership Units) were transferred by
Performance Investors to the Partnership pursuant the Escrow Agreements, the
number of Partnership Units held by each such Performance Investor were
automatically reduced by such amount on such date. To the extent the Partnership
Units held by the General Partner or Performance Investors were reduced as set
forth in the preceding two sentences, the Partnership immediately issued an
equal number of Performance Units to the Persons listed on Schedule G-1 and
Schedule G-2 to Exhibit G in accordance with the allocations set forth on
Exhibit G. The adjustments in the number of Partnership Units held by the
Performance Partners and the PLPs set forth above did not effect each such
Partners' Capital Account in the Partnership (except with respect to subsequent
allocations of items of Partnership income, gain, loss, deduction, and credit
made to such Partners and possibly with respect to the reissuance of a
Performance Unit subsequent to its
28
forfeiture by a PLP) and no PLP was obligated to make a contribution to the
capital of the Partnership in connection with the issuance of Performance Units.
Section 4.4 Stock Incentive Plan
If at any time or from time to time the General Partner sells
or issues REIT Shares pursuant to any Stock Incentive Plan, the General Partner
shall contribute any proceeds therefrom to the Partnership as an additional
Capital Contribution and shall receive an amount of additional Partnership Units
equal to the number of REIT Shares so sold or issued. The General Partner's
Capital Account shall be increased by the amount of cash so contributed.
Section 4.5 No Preemptive Rights
Except to the extent expressly granted by the Partnership
pursuant to another agreement, no Person shall have any preemptive, preferential
or other similar right with respect to (i) additional Capital Contributions or
loans to the Partnership or (ii) issuance or sale of any Partnership Units or
other Partnership Interests.
Section 4.6 Other Contribution Provisions
In the event that any Partner is admitted to the Partnership
and is given (or is treated as having received) a Capital Account in exchange
for services rendered to the Partnership, such transaction shall be treated by
the Partnership and the affected Partner as if the Partnership had compensated
such Partner in cash, and the Partner had contributed such cash to the capital
of the Partnership. In addition, with the consent of the General Partner, in its
sole discretion, one or more Limited Partners may enter into contribution
agreements with the Partnership which have the effect of providing a guarantee
of certain obligations of the Partnership.
ARTICLE 5.
DISTRIBUTIONS
Section 5.1 Requirement and Characterization of Distributions
The General Partner shall cause the Partnership to distribute
all, or such portion as the General Partner may in its discretion determine,
Available Cash generated by the Partnership (i) first, to the extent that the
amount of cash distributed with respect to any Partnership Interests that are
entitled to any preference in distribution for any prior distribution period was
less than the required distribution for such outstanding Partnership Interests
for such prior distribution period, and to the extent such deficiency has not
been subsequently distributed pursuant to this Section 5.1 (a "Preferred
Distribution Shortfall"), in accordance with the rights of such class of
Partnership Interests (and within such class, pro rata in proportion to the
respective Percentage Interests on the applicable record date) and to the
Partners who are Partners on the applicable record date with respect to such
distribution, (ii) second, with respect to any Partnership Interests that are
entitled to any preference in distribution, in accordance with the rights of
such class of Partnership Interests (and within such class, pro rata in
proportion to the respective Percentage Interests on the applicable record date)
and (iii) third, with respect to Partnership Interests that are not entitled to
any preference in distribution, pro rata to each such class on a quarterly basis
and in accordance with the terms of such class to Partners who are Partners of
such class on the
29
Partnership Record Date with respect to such distribution (and within each such
class, pro rata in proportion with the respective Percentage Interests on such
Partnership Record Date). Except as expressly provided for in Article 18 with
respect to the Series J Preferred Units, Article 19 with respect to the Series K
Preferred Units, Article 20 with respect to the Series L Preferred Units,
Article 21 with respect to the Series M Preferred Units and in an agreement, if
any, entered into in connection with the creation of a new class of Partnership
Interests in accordance with Article 4, no Partnership Interest shall be
entitled to a distribution in preference to any other Partnership Interest. The
General Partner shall take such reasonable efforts, as determined by it in its
sole and absolute discretion and consistent with its qualification as a REIT, to
cause the Partnership to distribute sufficient amounts to enable the General
Partner, for so long as the General Partner has determined to qualify as a REIT,
to pay stockholder dividends that will (a) satisfy the requirements for
qualifying as a REIT under the Code and Regulations ("REIT Requirements") and
(b) except to the extent otherwise determined by the General Partner, avoid any
Federal income or excise tax liability of the General Partner, except to the
extent that a distribution pursuant to clause (b) would prevent the Partnership
from making a distribution to the holders of Series J Preferred Units in
accordance with Section 18.3 and the holders of Series K Preferred Units in
accordance with Section 19.3.
Section 5.2 Distributions in Kind
Except as expressly provided herein, no right is given to any
Partner to demand and receive property other than cash. The General Partner may
determine, in its sole and absolute discretion, to make a distribution in kind
to the Partners of Partnership assets, and such assets shall be distributed in
such a fashion as to ensure that the fair market value is distributed and
allocated in accordance with Articles 5, 6 and 10; provided, however, that, in
such case, the General Partner shall distribute only cash to the Series J
Limited Partners and the Series K Limited Partners.
Section 5.3 Distributions Upon Liquidation
Notwithstanding Section 5.1, proceeds from a Liquidating Event
shall be distributed to the Partners in accordance with Section 13.2.
Section 5.4 Distributions to Reflect Issuance of Additional
Partnership Interests
In the event that the Partnership issues additional
Partnership Interests (other than Performance Units, which shall receive
distributions as set forth in Section 5.1) to the General Partner or any
Additional Limited Partner pursuant to Section 4.3.C or 4.4, the General Partner
shall make such revisions to this Article 5 as it determines are necessary to
reflect the issuance of such additional Partnership Interests. In the absence of
any agreement to the contrary, an Additional Limited Partner shall be entitled
to the distributions set forth in Section 5.1 (without regard to this Section
5.4) with respect to the quarter during which the closing of its contribution to
the Partnership occurs, multiplied by a fraction the numerator of which is the
number of days from and after the date of such closing through the end of the
applicable quarter, and the denominator of which is the total number of days in
such quarter.
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Section 5.5 Character of PLP Distributions
Distributions to each PLP pursuant to this Agreement shall be
advances or drawings of money or property against such Partner's distributive
share of Net Income (or items thereof) as described in Treasury Regulation
Section 1.731-1(a)(1)(ii).
ARTICLE 6.
ALLOCATIONS
Section 6.1 Timing and Amount of Allocations of Net Income and
Net Loss
Net Income and Net Loss of the Partnership shall be determined
and allocated with respect to each fiscal year of the Partnership as of the end
of each such year. Subject to the other provisions of this Article 6, an
allocation to a Partner of a share of Net Income or Net Loss shall be treated as
an allocation of the same share of each item of income, gain, loss or deduction
that is taken into account in computing Net Income or Net Loss.
Section 6.2 General Allocations
A. In General. Except as otherwise provided in this
Article 6, Net Income and Net Loss allocable with respect to a class of
Partnership Interests, shall be allocated to each of the Partners holding such
class of Partnership Interests in accordance with their respective Percentage
Interest of such class.
B.1. Net Income. Except as provided in Sections 6.2.B.3
and 6.3, Net Income for any Partnership Year shall be allocated in the following
manner and order of priority:
(a) First, 100% to the General Partner in an amount equal
to the remainder, if any, of the cumulative Net
Losses allocated to the General Partner pursuant to
Section 6.2.B.2(d) for all prior Partnership Years
minus the cumulative Net Income allocated to the
General Partner pursuant to this Section 6.2.B.1(a)
for all prior Partnership Years;
(b) Second, 100% to each Limited Partner in an amount
equal to the remainder, if any, of the cumulative Net
Losses allocated to each such Limited Partner
pursuant to Section 6.2.B.2(c) for all prior
Partnership Years minus the cumulative Net Income
allocated to such Limited Partner pursuant to this
Section 6.2.B.1(b) for all prior Partnership Years;
(c) Third, 100% to the General Partner and any Preferred
Limited Partners in an amount equal to the remainder,
if any, of the cumulative Net Losses allocated to
such Partners pursuant to Section 6.2.B.2(b) for all
prior Partnership Years minus the cumulative Net
Income allocated to such Partners pursuant to this
Section 6.2.B.1(c) for all prior Partnership Years;
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(d) Fourth, 100% to the General Partner and the Limited
Partners in an amount equal to the remainder, if any,
of the cumulative Net Losses allocated to each such
Partner pursuant to Section 6.2.B.2(a) for all prior
Partnership Years minus the cumulative Net Income
allocated to each Partner pursuant to this Section
6.2.B.1(d) for all prior Partnership Years;
(e) Fifth, 100% to the General Partner and any Preferred
Limited Partners in an amount equal to the excess of
(i) the cumulative Priority Return on such Partner's
Preferred Units to the last day of the current
Partnership Year or to the date of redemption of such
Preferred Units, to the extent such Preferred Units
are redeemed during such year, over (ii) the
cumulative Net Income allocated to the General
Partner or such Preferred Limited Partner, as
applicable, pursuant to this Section 6.2.B.1(e) for
all prior Partnership Years; and
(f) Sixth, 100% to the General Partner and the Limited
Partners in accordance with their respective
Percentage Interests in the Common Units.
To the extent the allocations of Net Income set forth above in
any paragraph of this Section 6.2.B.1 are not sufficient to entirely satisfy the
allocation set forth in such paragraph, such allocation shall be made in
proration to the total amount that would have been allocated pursuant to such
paragraph without regard to such shortfall.
B.2. Net Losses. Except as provided in Sections 6.2.B.3
and 6.3, Net Losses for any Partnership Year shall be allocated in the following
manner and order of priority:
(a) First, 100% to the General Partner and the Limited
Partners in accordance with their respective
Percentage Interests in the Common Units (to the
extent consistent with this Section 6.2.B.2(a)) until
the Adjusted Capital Account (ignoring for this
purpose any amounts a Partner is obligated to
contribute to the capital of the Partnership or is
deemed obligated to contribute pursuant to
Regulations Section 1.704-1(b)(2)(ii)(c)(2) and
ignoring the Partner's Series J Preferred Capital,
the Series K Preferred Capital, the Series L
Preferred Capital and the Series M Preferred Capital)
of each such Partner is zero;
(b) Second, 100% to the General Partner and any Preferred
Limited Partners, pro rata to each such Partner's
Adjusted Capital Account (ignoring for this purpose
any amounts a Partner is obligated to contribute to
the capital of the Partnership or is deemed obligated
to contribute pursuant to Regulations Section
1.704-1(b)(2)(ii)(c)(2)), until the Adjusted Capital
Account (as so modified) of each such Partner is
zero;
(c) Third, 100% to the Limited Partners to the extent of,
and in proportion to, the positive balance (if any)
in their Adjusted Capital Accounts; and
(d) Fourth, 100% to the General Partner.
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B.3. Terminating Capital Transactions.
(a) If no Performance Units are outstanding at
the time of a Terminating Capital
Transaction, any Net Income attributable to
such Terminating Capital Transaction shall
first be allocated to the General Partner in
an amount equal to the Offering Costs, to
the extent the General Partner's Capital
Account has not previously been adjusted to
account for such amounts.
(b) If Performance Units are outstanding at the
time of a Terminating Capital Transaction --
(1) any Net Income attributable to such
Terminating Capital Transaction
shall be allocated as follows: such
Net Income shall first be
tentatively allocated solely as an
interim step in calculating final
allocations pursuant to this
Section 6.2.B.3(b)(1), among the
Partners in accordance with Section
6.2.B.3(a), Section 6.2.A and
Section 6.2.B.1. Then the amount so
tentatively allocated to each
Performance Partner, to the extent
of each such Performance Partner's
Excess Performance Capital, shall
instead be allocated to the PLPs,
pro rata to the number of
Performance Units held by each PLP.
(2) any Net Loss attributable to such
Terminating Capital Transaction
shall be allocated as follows: such
Net Loss shall first be tentatively
allocated, solely as an interim
step in calculating final
allocations pursuant to this
Section 6.2.B.3(b)(2), among the
Partners in accordance with Section
6.2.A and Section 6.2.B.2. Then the
amount so tentatively allocated to
the PLPs shall instead be allocated
to the Performance Partners to the
extent of the aggregate Excess
Performance Capital of the
Performance Partners. Any amounts
so allocated away from the PLPs
shall be done on a basis which is
proportionate to each PLP's
Performance Units. Any amounts so
allocated to the Performance
Partners shall be done on a basis
which is proportionate to each
Performance Partner's Excess
Performance Capital.
C. Allocations to Reflect Issuance of Additional
Partnership Interests. In the event that the Partnership issues additional
Partnership Interests to the General Partner or any Additional Limited Partner
pursuant to Section 4.3 or 4.4, the General Partner shall make such revisions to
this Section 6.2 or to Section 12.2.B as it determines are necessary to reflect
the terms of the issuance of such additional Partnership Interests, including
making preferential allocations to certain classes of Partnership Interests,
subject to the terms of the Series J Preferred Units, the Series K Preferred
Units, the Series L Preferred Units and the Series M Preferred Units. In
addition, for any quarter in which Performance Units were issued, Net Income and
Net Loss relating to such units shall be allocated among (i) the PLPs who
received such units and (ii) the Performance Partners who returned the
corresponding Partnership Units to
33
the Partnership, in accordance with any method selected by the General Partner
which is permitted under Section 706 of the Code.
Section 6.3 Additional Allocation Provisions
Notwithstanding the foregoing provisions of this Article 6:
A. Regulatory Allocations.
(i) Minimum Gain Chargeback. Except as otherwise
provided in Regulations Section 1.704-2(f), notwithstanding the
provisions of Section 6.2, or any other provision of this Article 6, if
there is a net decrease in Partnership Minimum Gain during any fiscal
year, each Partner shall be specially allocated items of Partnership
income and gain for such year (and, if necessary, subsequent years) in
an amount equal to such Partner's share of the net decrease in
Partnership Minimum Gain, as determined under Regulations Section
1.704-2(g). Allocations pursuant to the previous sentence shall be made
in proportion to the respective amounts required to be allocated to
each Partner pursuant thereto. The items to be allocated shall be
determined in accordance with Regulations Sections 1.704-2(f)(6) and
1.704-2(j)(2). This Section 6.3.A(i) is intended to qualify as a
"minimum gain chargeback" within the meaning of Regulation Section
1.704-2(f) which shall be controlling in the event of a conflict
between such Regulation and this Section 6.3.A(i).
(ii) Partner Minimum Gain Chargeback. Except as
otherwise provided in Regulations Section 1.704-2(i)(4), and
notwithstanding the provisions of Section 6.2, or any other provision
of this Article 6 (except Section 6.3.A(i)), if there is a net decrease
in Partner Minimum Gain attributable to a Partner Nonrecourse Debt
during any fiscal year, each Partner who has a share of the Partner
Minimum Gain attributable to such Partner Nonrecourse Debt, determined
in accordance with Regulations Section 1.704-2(i)(5), shall be
specially allocated items of Partnership income and gain for such year
(and, if necessary, subsequent years) in an amount equal to such
Partner's share of the net decrease in Partner Minimum Gain
attributable to such Partner Nonrecourse Debt, determined in accordance
with Regulations Section 1.704-2(i)(4). Allocations pursuant to the
previous sentence shall be made in proportion to the respective amounts
required to be allocated to each General Partner and Limited Partner
pursuant thereto. The items to be so allocated shall be determined in
accordance with Regulations Sections 1.704-2(i)(4) and 1.704-2(j)(2).
This Section 6.3.A(ii) is intended to qualify as a "chargeback of
partner nonrecourse debt minimum gain" within the meaning of Regulation
Section 1.704-2(i) which shall be controlling in the event of a
conflict between such Regulation and this Section 6.3.A(ii).
(iii) Nonrecourse Deductions and Partner
Nonrecourse Deductions. Any Nonrecourse Deductions for any fiscal year
shall be specially allocated to the Partners in accordance with their
respective Percentage Interest in Common Units. Any Partner Nonrecourse
Deductions for any fiscal year shall be specially allocated to the
Partner(s) who bears the economic risk of loss with respect to the
Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions
are attributable, in accordance with Regulations Sections 1.704-2(b)(4)
and 1.704-2(i).
34
(iv) Qualified Income Offset. If any Partner
unexpectedly receives an adjustment, allocation or distribution
described in Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6),
items of Partnership income and gain shall be allocated, in accordance
with Regulations Section 1.704-1(b)(2)(ii)(d), to the Partner in an
amount and manner sufficient to eliminate, to the extent required by
such Regulations, the Adjusted Capital Account Deficit of the Partner
as quickly as possible provided that an allocation pursuant to this
Section 6.3.A(iv) shall be made if and only to the extent that such
Partner would have an Adjusted Capital Account Deficit after all other
allocations provided in this Article 6 have been tentatively made as if
this Section 6.3.A(iv) were not in the Agreement. It is intended that
this Section 6.3.A(iv) qualify and be construed as a "qualified income
offset" within the meaning of Regulations 1.704-1(b)(2)(ii)(d), which
shall be controlling in the event of a conflict between such
Regulations and this Section 6.3.A(iv).
(v) Gross Income Allocation. In the event any
Partner has a deficit Capital Account at the end of any fiscal year
which is in excess of the sum of (a) the amount (if any) such Partner
is obligated to restore to the Partnership and (b) the amount such
Partner is deemed to be obligated to restore pursuant to Regulations
Section 1.704-1(b)(2)(ii)(c) or the penultimate sentences of
Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5), each such Partner
shall be specially allocated items of Partnership income and gain in
the amount of such excess as quickly as possible; provided, that an
allocation pursuant to this Section 6.3.A(v) shall be made if and only
to the extent that such Partner would have a deficit Capital Account in
excess of such sum after all other allocations provided in this Article
6 have been tentatively made as if this Section 6.3.A(v) and Section
6.3.A(iv) were not in the Agreement.
(vi) Limitation on Allocation of Net Loss. To the
extent any allocation of Net Loss would cause or increase an Adjusted
Capital Account Deficit as to any Partner, such allocation of Net Loss
shall be reallocated among the other Partners in accordance with their
respective Percentage Interests in Common Units, subject to the
limitations of this Section 6.3.A(vi).
(vii) Section 754 Adjustment. To the extent an
adjustment to the adjusted tax basis of any Partnership asset pursuant
to Code Section 734(b) or Code Section 743(b) is required, pursuant to
Regulations Section 1.704-1(b)(2)(iv)(m)(2) or Regulations Section
1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining
Capital Accounts as the result of a distribution to a Partner in
complete liquidation of his interest in the Partnership, the amount of
such adjustment to the Capital Accounts shall be treated as an item of
gain (if the adjustment increases the basis of the asset) or loss (if
the adjustment decreases such basis) and such gain or loss shall be
specially allocated to the Partners in accordance with their interests
in the Partnership in the event that Regulations Section
1.704-1(b)(2)(iv)(m)(2) applies, or to the Partners to whom such
distribution was made in the event that Regulations Section
1.704-1(b)(2)(iv)(m)(4) applies.
(viii) Curative Allocation. The allocations set
forth in Sections 6.3.A(i), (ii), (iii), (iv), (v), (vi), and (vii)
(the "Regulatory Allocations") are intended to comply with certain
regulatory requirements, including the requirements of Regulations
Sections
35
1.704-1(b) and 1.704-2. Notwithstanding the provisions of Sections 6.1
and 6.2, the Regulatory Allocations shall be taken into account in
allocating other items of income, gain, loss and deduction among the
Partners so that, to the extent possible, the net amount of such
allocations of other items and the Regulatory Allocations to each
Partner shall be equal to the net amount that would have been allocated
to each such Partner if the Regulatory Allocations had not occurred.
B. For purposes of determining a Partner's proportional
share of the "excess nonrecourse liabilities" of the Partnership within the
meaning of Regulations Section 1.752-3(a)(3), each Partner's interest in
Partnership profits shall be such Partner's Percentage Interest in Common Units.
Section 6.4 Tax Allocations
A. In General. Except as otherwise provided in this
Section 6.4, for income tax purposes each item of income, gain, loss and
deduction (collectively, "Tax Items") shall be allocated among the Partners in
the same manner as its correlative item of "book" income, gain, loss or
deduction is allocated pursuant to Sections 6.2 and 6.3.
B. Allocations Respecting Section 704(c) Revaluations.
Notwithstanding Section 6.4.A, Tax Items with respect to Partnership property
that is contributed to the Partnership by a Partner shall be shared among the
Partners for income tax purposes pursuant to Regulations promulgated under
Section 704(c) of the Code, so as to take into account the variation, if any,
between the basis of the property to the Partnership and its initial Gross Asset
Value. With respect to Partnership property that is initially contributed to the
Partnership upon its formation pursuant to Section 4.1, such variation between
basis and initial Gross Asset Value shall be taken into account under the
"traditional method" as described in Regulations Section 1.704-3(b). With
respect to properties subsequently contributed to the Partnership, the
Partnership shall account for such variation under any method approved under
Section 704(c) of the Code and the applicable regulations as chosen by the
General Partner. In the event the Gross Asset Value of any Partnership asset is
adjusted pursuant to subparagraph (ii) of the definition of Gross Asset Value
(provided in Article 1), subsequent allocations of Tax Items with respect to
such asset shall take account of the variation, if any, between the adjusted
basis of such asset and its Gross Asset Value in the same manner as under
Section 704(c) of the Code and the applicable regulations consistent with the
requirements of Regulations Section 1.704-1(b)(2)(iv)(g) using any method
approved under 704(c) of the Code and the applicable regulations as chosen by
the General Partner.
ARTICLE 7.
MANAGEMENT AND OPERATIONS OF BUSINESS
Section 7.1 Management
A. Except as otherwise expressly provided in this
Agreement, all management powers over the business and affairs of the
Partnership are exclusively vested in the General Partner, and no Limited
Partner shall have any right to participate in or exercise control or management
power over the business and affairs of the Partnership. The General Partner may
not be removed by the Limited Partners with or without cause, except with the
consent of the
36
General Partner. In addition to the powers now or hereafter granted a general
partner of a limited partnership under the Act and other applicable law or which
are granted to the General Partner under any other provision of this Agreement,
the General Partner, subject to the other provisions hereof including Section
7.3, shall have full power and authority to do all things deemed necessary or
desirable by it to conduct the business of the Partnership, to exercise all
powers set forth in Section 3.2 and to effectuate the purposes set forth in
Section 3.1, including, without limitation:
(i) the making of any expenditures, the lending or
borrowing of money (including, without limitation,
making prepayments on loans and borrowing money to
permit the Partnership to make distributions to its
Partners in such amounts as will permit the General
Partner (for so long as the General Partner has
determined to qualify as a REIT) to avoid the payment
of any Federal income tax (including, for this
purpose, any excise tax pursuant to Section 4981 of
the Code) and to make distributions to its
stockholders sufficient to permit the General Partner
to maintain REIT status), the assumption or guarantee
of, or other contracting for, indebtedness and other
liabilities, the issuance of evidences of
indebtedness (including the securing of same by
mortgage, deed of trust or other lien or encumbrance
on all or any of the Partnership's assets) and the
incurring of any obligations it deems necessary for
the conduct of the activities of the Partnership;
(ii) the making of tax, regulatory and other filings, or
rendering of periodic or other reports to
governmental or other agencies having jurisdiction
over the business or assets of the Partnership;
(iii) subject to the provisions of Section 7.3.D, the
acquisition, disposition, mortgage, pledge,
encumbrance, hypothecation or exchange of any assets
of the Partnership or the merger or other combination
of the Partnership with or into another entity;
(iv) the mortgage, pledge, encumbrance or hypothecation of
all or any assets of the Partnership, and the use of
the assets of the Partnership (including, without
limitation, cash on hand) for any purpose consistent
with the terms of this Agreement and on any terms it
sees fit, including, without limitation, the
financing of the conduct or the operations of the
General Partner or the Partnership, the lending of
funds to other Persons (including, without
limitation, the General Partner (if necessary to
permit the financing or capitalization of a
subsidiary of the General Partner or the Partnership)
and any Subsidiaries of the Partnership) and the
repayment of obligations of the Partnership, any of
its Subsidiaries and any other Person in which it has
an equity investment;
(v) the negotiation, execution, and performance of any
contracts, leases, conveyances or other instruments
that the General Partner considers useful or
necessary to the conduct of the Partnership's
operations or the implementation of the General
Partner's powers under this Agreement;
37
(vi) the distribution of Partnership cash or other
Partnership assets in accordance with this Agreement;
(vii) the selection and dismissal of employees of the
Partnership (including, without limitation, employees
having titles such as "president," "vice president,"
"secretary" and "treasurer"), and agents, outside
attorneys, accountants, consultants and contractors
of the Partnership, the determination of their
compensation and other terms of employment or hiring,
including waivers of conflicts of interest and the
payment of their expenses and compensation out of the
Partnership's assets;
(viii) the maintenance of such insurance for the benefit of
the Partnership and the Partners as it deems
necessary or appropriate;
(ix) the formation of, or acquisition of an interest in,
and the contribution of property to, any further
limited or general partnerships, joint ventures or
other relationships that it deems desirable
(including, without limitation, the acquisition of
interests in, and the contributions of property to
any Subsidiary and any other Person in which it has
an equity investment from time to time); provided
that, as long as the General Partner has determined
to continue to qualify as a REIT, the Partnership may
not engage in any such formation, acquisition or
contribution that would cause the General Partner to
fail to qualify as a REIT;
(x) the control of any matters affecting the rights and
obligations of the Partnership, including the conduct
of litigation and the incurring of legal expense and
the settlement of claims and litigation, and the
indemnification of any Person against liabilities and
contingencies to the extent permitted by law;
(xi) the undertaking of any action in connection with the
Partnership's direct or indirect investment in any
Person (including, without limitation, contributing
or loaning Partnership funds to, incurring
indebtedness on behalf of, or guarantying the
obligations of any such Persons);
(xii) subject to the other provisions in this Agreement,
the determination of the fair market value of any
Partnership property distributed in kind using such
reasonable method of valuation as it may adopt;
provided that, such methods are otherwise consistent
with requirements of this Agreement;
(xiii) the management, operation, leasing, landscaping,
repair, alteration, demolition or improvement of any
real property or improvements owned by the
Partnership or any Subsidiary of the Partnership or
any Person in which the Partnership has made a direct
or indirect equity investment;
(xiv) holding, managing, investing and reinvesting cash and
other assets of the Partnership;
(xv) the collection and receipt of revenues and income of
the Partnership;
38
(xvi) the exercise, directly or indirectly through any
attorney-in-fact acting under a general or limited
power of attorney, of any right, including the right
to vote, appurtenant to any asset or investment held
by the Partnership;
(xvii) the exercise of any of the powers of the General
Partner enumerated in this Agreement on behalf of or
in connection with any Subsidiary of the Partnership
or any other Person in which the Partnership has a
direct or indirect interest, or jointly with any such
Subsidiary or other Person;
(xviii) the exercise of any of the powers of the General
Partner enumerated in this Agreement on behalf of any
Person in which the Partnership does not have an
interest, pursuant to contractual or other
arrangements with such Person; and
(xix) the making, execution and delivery of any and all
deeds, leases, notes, deeds to secure debt,
mortgages, deeds of trust, security agreements,
conveyances, contracts, guarantees, warranties,
indemnities, waivers, releases or legal instruments
or other agreements in writing necessary or
appropriate in the judgment of the General Partner
for the accomplishment of any of the powers of the
General Partner enumerated in this Agreement.
B. Each of the Limited Partners agrees that the General
Partner is authorized to execute, deliver and perform the above-mentioned
agreements and transactions on behalf of the Partnership without any further
act, approval or vote of the partners, notwithstanding any other provisions of
this Agreement (except as provided in Section 7.3), the Act or any applicable
law, rule or regulation. The execution, delivery or performance by the General
Partner or the Partnership of any agreement authorized or permitted under this
Agreement shall not constitute a breach by the General Partner of any duty that
the General Partner may owe the Partnership or the Limited Partners or any other
Persons under this Agreement or of any duty stated or implied by law or equity.
C. At all times from and after the date hereof, the
General Partner may cause the Partnership to obtain and maintain (i) casualty,
liability and other insurance (including, without limitation, earthquake
insurance) on the properties of the Partnership and (ii) liability insurance for
the Indemnities hereunder.
D. At all times from and after the date hereof, the
General Partner may cause the Partnership to establish and maintain working
capital and other reserves in such amounts as the General Partner, in its sole
and absolute discretion, deems appropriate and reasonable from time to time.
E. In exercising its authority under this Agreement, the
General Partner may, but other than as set forth in the following sentence and
as expressly set forth in the agreements listed on Exhibit I hereto, shall be
under no obligation to, take into account the tax consequences to any Partner
(including the General Partner) of any action taken by the General Partner. The
General Partner, on behalf of the Partnership, shall use commercially reasonable
efforts to cooperate with the Limited Partners to minimize any taxes payable in
connection with any sale,
39
exchange or any other disposition of assets of the Partnership. The General
Partner and the Partnership shall not have liability to a Limited Partner under
any circumstances as a result of an income tax liability incurred by such
Limited Partner as a result of an action (or inaction) by the General Partner
pursuant to its authority under this Agreement.
F. Except as otherwise provided herein, to the extent
the duties of the General Partner require expenditures of funds to be paid to
third parties, the General Partner shall not have any obligations hereunder
except to the extent that Partnership funds are reasonably available to it for
the performance of such duties, and nothing herein contained shall be deemed to
authorize or require the General Partner, in its capacity as such, to expend its
individual funds for payment to third parties or to undertake any individual
liability or obligation on behalf of the Partnership.
Section 7.2 Certificate of Limited Partnership
To the extent that such action is determined by the General
Partner to be reasonable and necessary or appropriate, the General Partner shall
file amendments to and restatements of the Certificate and do all the things to
maintain the Partnership as a limited partnership (or a partnership in which the
limited partners have limited liability) under the laws of the State of Delaware
and to maintain the Partnership's qualification to do business as a foreign
limited partnership in each other state, the District of Columbia or other
jurisdiction, in which the Partnership may elect to do business or own property.
Subject to the terms of Section 8.5.A(iv), the General Partner shall not be
required, before or after filing, to deliver or mail a copy of the Certificate
or any amendment thereto to any Limited Partner. The General Partner shall use
all reasonable efforts to cause to be filed such other certificates or documents
as may be reasonable and necessary or appropriate for the formation,
continuation, qualification and operation of a limited partnership (or a
partnership in which the limited partners have limited liability) in the State
of Delaware, and any other state, or the District of Columbia or other
jurisdiction, in which the Partnership may elect to do business or own property.
Section 7.3 Restrictions on General Partner's Authority
A. The General Partner may not take any action in
contravention of this Agreement, including, without limitation:
(i) take any action that would make it impossible to
carry on the ordinary business of the Partnership,
except as otherwise provided in this Agreement;
(ii) possess Partnership property, or assign any rights in
specific Partnership property, for other than a
Partnership purpose except as otherwise provided in
this Agreement;
(iii) admit a Person as a Partner, except as otherwise
provided in this Agreement (including with respect to
the PLPs, who shall become Partners upon their
receipt of Performance Units);
40
(iv) perform any act that would subject a Limited Partner
to liability as a general partner in any jurisdiction
or any other liability except as provided herein or
under the Act; or
(v) enter into any contract, mortgage, loan or other
agreement that prohibits or restricts, or has the
effect of prohibiting or restricting, the ability of
a Limited Partner to exercise its rights to a
Redemption in full, except with the written consent
of such Limited Partner.
B. The General Partner shall not, without the prior
Consent of the Partners (in addition to any Consent of the Limited Partners
required by any other provision hereof), undertake, on behalf of the
Partnership, any of the following actions or enter into any transaction which
would have the effect of such transactions:
(i) except as provided in Section 7.3.D below, amend,
modify or terminate this Agreement other than to
reflect the admission, substitution, termination or
withdrawal of partners pursuant to Article 12;
(ii) make a general assignment for the benefit of
creditors or appoint or acquiesce in the appointment
of a custodian, receiver or trustee for all or any
part of the assets of the Partnership;
(iii) institute any proceeding for bankruptcy on behalf of
the Partnership;
(iv) confess a judgment against the Partnership; or
(v) enter into a merger (including a triangular merger),
consolidation or other combination of the Partnership
with or into another entity.
C. Except in the case of a Liquidating Event pursuant to
Section 13.1 (other than Section 13.1.F), the General Partner shall not, without
the prior Consent of the Limited Partners, undertake, on behalf of the
Partnership, any actions or enter into any transaction which would have the
effect of a dissolution of the Partnership, including a sale, exchange, transfer
or other disposition of all or substantially all of the Partnership's assets in
a single transaction or a series of related transactions.
D. Notwithstanding Sections 7.3.B and 7.3.C, but subject
to Section 7.3.E, the General Partner shall have the power, without the Consent
of the Partners, to amend this Agreement as may be required to facilitate or
implement any of the following purposes:
(i) to add to the obligations of the General Partner or
surrender any right or power granted to the General
Partner or any Affiliate of the General Partner for
the benefit of the Limited Partners;
(ii) to reflect the issuance of additional Partnership
Interests pursuant to Sections 4.3.C, 4.3.F and 4.4,
or the admission, substitution, termination,
reduction in Partnership Units or withdrawal of
Partners in accordance with this Agreement (which may
be effected through the replacement of Exhibit A with
an amended Exhibit A);
41
(iii) to set forth or amend the designations, rights,
powers, duties, and preferences of the holders of any
additional Partnership Interests issued pursuant to
Article 4;
(iv) to reflect a change that is of an inconsequential
nature and does not adversely affect the Limited
Partners in any material respect, or to cure any
ambiguity in, correct or supplement any provision, or
make other changes with respect to matters arising
under, this Agreement that will not be inconsistent
with law or with the provisions of this Agreement;
(v) to satisfy any requirements, conditions, or
guidelines contained in any order, directive,
opinion, ruling or regulation of a Federal, state of
local agency or contained in Federal, state or local
law.
(vi) to reflect such changes as are reasonably necessary
for the General Partner to maintain its status as a
REIT, including changes which may be necessitated due
to a change in applicable law (or an authoritative
interpretation thereof) or a ruling of the IRS; and
(vii) to modify, as set forth in the definition of "Capital
Account," the manner in which Capital Accounts are
computed.
The General Partner will provide notice to the Limited Partners when any action
under this Section 7.3.D is taken.
E. Notwithstanding Sections 7.3.B, 7.3.C and 7.3.D, this
Agreement shall not be amended, and no action may be taken by the General
Partner, including in either case through merger or sale of assets of the
Partnership or otherwise, without the Consent of each Common Limited Partner or
Preferred Limited Partner adversely affected if such amendment or action would
(i) convert a Limited Partner's interest in the Partnership into a general
partner's interest (except as the result of the General Partner acquiring such
interest), (ii) modify the limited liability of a Limited Partner, (iii) alter
rights of the Partner to receive distributions pursuant to Article 5, Section
13.2.A(4), Article 18, Article 19, Article 20 or Article 21 or the allocations
specified in Article 6 (except as permitted pursuant to Section 4.3 and Section
7.3.D), (iv) alter or modify the rights to a Redemption or the REIT Shares
Amount as set forth in Section 8.6, and related definitions hereof, (v) alter
the redemption or exchange rights as set forth in Sections 18.5, 18.8 19.5 and
19.8 hereof, respectively, or (vi) amend this Section 7.3.E. Further, no
amendment may alter the restrictions on the General Partner's authority set
forth elsewhere in this Section 7.3 without the Consent specified in such
section. In addition, (a) Section 11.2 of this Agreement shall not be amended,
and no action in contravention of Section 11.2 shall be taken, including in
either case through merger or sale of assets of the Partnership or otherwise,
without the Consent of the Limited Partners and (b) this Agreement shall not be
amended, and no action shall be taken, including in either case through merger
or sale of assets of the Partnership or otherwise, which would adversely affect
the rights of the Persons set forth in Exhibit G to receive Performance Units as
described herein.
F. Other than incident to a transaction pursuant to
Sections 11.2.B or 11.2.C, the General Partner shall not undertake to dispose of
any Partnership Property specified in the
42
agreements listed in Exhibit H in a taxable sale or taxable exchange prior to
the dates specified in such agreements without the prior consent of each Limited
Partner which contributed all or any portion of an interest in such Property to
the Partnership, as set forth in such agreements.
Section 7.4 Reimbursement of the General Partner
A. Except as provided in this Section 7.4 and elsewhere
in this Agreement (including the provisions of Articles 5 and 6 regarding
distributions, payments and allocations to which it may be entitled), the
General Partner shall not be compensated for its services as general partner of
the Partnership.
B. Subject to Section 15.11, the General Partner shall
be reimbursed on a monthly basis, or such other basis as the General Partner may
determine in its sole and absolute discretion, for all expenses it incurs
relating to the ownership of interests in and operation of, or for the benefit
of, the Partnership. The Limited Partners acknowledge that the General Partner's
sole business is the ownership of interests in and operation of the Partnership
and that such expenses are incurred for the benefit of the Partnership; provided
that, the General Partner shall not be reimbursed for expenses it incurs
relating to the organization of the Partnership and the General Partner, or the
initial public offering or subsequent offerings of REIT Shares, other shares of
capital stock or Funding Debt by the General Partner, but shall be reimbursed
for expenses it incurs with respect to any other issuance of additional
Partnership Interests pursuant to the provisions hereof. Such reimbursements
shall be in addition to any reimbursement to the General Partner as a result of
indemnification pursuant to Section 7.7.
C. If and to the extent any reimbursements to the
General Partner pursuant to this Section 7.4 constitute gross income of the
General Partner (as opposed to the repayment of advances made by the General
Partner on behalf of the Partnership), such amounts shall constitute guaranteed
payments within the meaning of Section 707(c) of the Code, shall be treated
consistently therewith by the Partnership and all Partners, and shall not be
treated as distributions for purposes of computing the Partners' Capital
Accounts.
Section 7.5 Outside Activities of the General Partner
A. Except in connection with a transaction authorized in
Section 11.2, without the Consent of the Limited Partners, the General Partner
shall not, directly or indirectly, enter into or conduct any business, other
than in connection with the ownership, acquisition and disposition of
Partnership Interests as a General Partner and the management of the business of
the Partnership, its operation as a public reporting company with a class (or
classes) of securities registered under the Exchange Act, its operation as a
REIT and such activities as are incidental to the same. Without the Consent of
the Limited Partners, the General Partner shall not, directly or indirectly,
participate in or otherwise acquire any interest in any real or personal
property, except its General Partner Interest, its interest in any Subsidiary
Partnership(s) (held directly or indirectly through a Qualified REIT Subsidiary)
that the General Partner holds in order to maintain such Subsidiary
Partnership's status as a partnership, and such bank accounts, similar
instruments or other short-term investments as it deems necessary to carry out
its responsibilities contemplated under this Agreement and the Charter. In the
event the General Partner desires to contribute cash to any Subsidiary
Partnership to acquire or maintain an interest of 1% or less in the capital of
such partnership, the General Partner may acquire such cash from the Partnership
43
in exchange for a reduction in the General Partner's Units, in an amount equal
to the amount of such cash divided by the Fair Market Value of a REIT Share on
the day such cash is received by the General Partner. Notwithstanding the
foregoing, the General Partner may acquire Properties in exchange for REIT
Shares, to the extent such Properties are immediately contributed by the General
Partner to the Partnership, pursuant to the terms described in Section 4.3.E.
Any Limited Partner Interests acquired by the General Partner, whether pursuant
to exercise by a Limited Partner of its right of Redemption, or otherwise, shall
be automatically converted into a General Partner Interest comprised of an
identical number of Partnership Units with the same rights, priorities and
preferences as the class or series so acquired. If, at any time, the General
Partner acquires material assets (other than on behalf of the Partnership) the
definition of "REIT Shares Amount" and the definition of "Deemed Value of
Partnership Interests" shall be adjusted, as reasonably agreed to by the General
Partner and the other Limited Partners, to reflect the relative Fair Market
Value of a share of capital stock of the General Partner relative to the Deemed
Partnership Interest Value of the related Partnership Unit. The General
Partner's General Partner Interest in the Partnership, its minority interest in
any Subsidiary Partnership(s) (held directly or indirectly through a Qualified
REIT Subsidiary) that the General Partner holds in order to maintain such
Subsidiary Partnership's status as a partnership, and interests in such
short-term liquid investments, bank accounts or similar instruments as the
General Partner deems necessary to carry out its responsibilities contemplated
under this Agreement and the Charter are interests which the General Partner is
permitted to acquire and hold for purposes of this Section 7.5.A.
B. In the event the General Partner exercises its rights
under the Charter to purchase REIT Shares or Preferred Shares, then the General
Partner shall cause the Partnership to redeem from it a number of Partnership
Units of the appropriate class as determined based on, in the case of REIT
Shares, the REIT Shares Amount equal to the number of REIT Shares so purchased,
or in the case of Preferred Shares an equal number of Preferred Units which
correspond in ranking to the Preferred Shares so purchased, in each case on the
same terms that the General Partner purchased such REIT Shares or Preferred
Shares (as applicable).
Section 7.6 Contracts with Affiliates
A. Except as expressly permitted by this Agreement, the
Partnership shall not, directly or indirectly, sell, transfer or convey any
property to, or purchase any property from, or borrow funds from, or lend funds
to, any Partner or any Affiliate of the Partnership that is not also a
Subsidiary of the Partnership, except pursuant to transactions that are on terms
that are fair and reasonable and no less favorable to the Partnership than would
be obtained from an unaffiliated third party.
B. The General Partner, in its sole and absolute
discretion and without the approval of the Limited Partners, may propose and
adopt on behalf of the Partnership employee benefit plans funded by the
Partnership for the benefit of employees of the General Partner, the
Partnership, Subsidiaries of the Partnership or any Affiliate of any of them in
respect of services performed, directly or indirectly, for the benefit of the
Partnership, the General Partner, or any of the Partnership's Subsidiaries. The
General Partner also is expressly authorized to cause the Partnership to issue
to it Partnership Units corresponding to REIT Shares issued by the General
Partner pursuant to its Stock Incentive Plan or any similar or successor plan
and to repurchase
44
such Partnership Units from the General Partner to the extent necessary to
permit the General Partner to repurchase such REIT Shares in accordance with
such plan.
Section 7.7 Indemnification
A. The Partnership shall indemnify an Indemnitee from
and against any and all losses, claims, damages, liabilities, joint or several,
expenses (including legal fees and expenses), judgments, fines, settlements, and
other amounts arising from any and all claims, demands, actions, suits or
proceedings, civil, criminal, administrative or investigative, that relate to
the operations of the Partnership as set forth in this Agreement in which any
Indemnitee may be involved, or is threatened to be involved, as a party or
otherwise, unless it is established that: (i) the act or omission of the
Indemnitee was material to the matter giving rise to the proceeding and either
was committed in bad faith or was the result of active and deliberate
dishonesty; (ii) the Indemnitee actually received an improper personal benefit
in money, property or services; or (iii) in the case of any criminal proceeding,
the Indemnitee had reasonable cause to believe that the act or omission was
unlawful. Without limitation, the foregoing indemnity shall extend to any
liability of any Indemnitee, pursuant to a loan guaranty or otherwise, for any
indebtedness of the Partnership or any Subsidiary of the Partnership (including,
without limitation, any indebtedness which the Partnership or any Subsidiary of
the Partnership has assumed or taken subject to), and the General Partner is
hereby authorized and empowered, on behalf of the Partnership, to enter into one
or more indemnity agreements consistent with the provisions of this Section 7.7
in favor of any Indemnitee having or potentially having liability for any such
indebtedness. The termination of any proceeding by judgment, order or settlement
does not create a presumption that the Indemnitee did not meet the requisite
standard of conduct set forth in this Section 7.7.A. The termination of any
proceeding by conviction or upon a plea of nolo contendere or its equivalent, or
any entry of an order of probation prior to judgment, creates a rebuttable
presumption that the Indemnitee acted in a manner contrary to that specified in
this Section 7.7.A. Any indemnification pursuant to this Section 7.7 shall be
made only out of the assets of the Partnership, and any insurance proceeds from
the liability policy covering the General Partner and any Indemnitee, and
neither the General Partner nor any Limited Partner shall have any obligation to
contribute to the capital of the Partnership or otherwise provide funds to
enable the Partnership to fund its obligations under this Section 7.7.
B. Reasonable expenses incurred by an Indemnitee who is
a party to a proceeding may be paid or reimbursed by the Partnership in advance
of the final disposition of the proceeding upon receipt by the Partnership of
(i) a written affirmation by the Indemnitee of the Indemnitee's good faith
belief that the standard of conduct necessary for indemnification by the
Partnership as authorized in Section 7.7.A has been met and (ii) a written
undertaking by or on behalf of the Indemnitee to repay the amount if it shall
ultimately be determined that the standard of conduct has not been met.
C. The indemnification provided by this Section 7.7
shall be in addition to any other rights to which an Indemnitee or any other
Person may be entitled under any agreement, pursuant to any vote of the
Partners, as a matter of law or otherwise, and shall continue as to an
Indemnitee who has ceased to serve in such capacity.
D. The Partnership may purchase and maintain insurance,
on behalf of the Indemnitees and such other Persons as the General Partner shall
determine, against any liability
45
that may be asserted against or expenses that may be incurred by any such Person
in connection with the Partnership's activities, regardless of whether the
Partnership would have the power to indemnify such Person against such liability
under the provisions of this Agreement.
E. For purposes of this Section 7.7, the Partnership
shall be deemed to have requested an Indemnitee to serve as fiduciary of an
employee benefit plan whenever the performance by it of its duties to the
Partnership also imposes duties on, or otherwise involves services by, it to the
plan or participants or beneficiaries of the plan; excise taxes assessed on an
Indemnitee with respect to an employee benefit plan pursuant to applicable law
shall constitute fines within the meaning of Section 7.7; and actions taken or
omitted by the Indemnitee with respect to an employee benefit plan in the
performance of its duties for a purpose reasonably believed by it to be in the
interest of the participants and beneficiaries of the plan shall be deemed to be
for a purpose which is not opposed to the best interests of the Partnership.
F. In no event may an Indemnitee subject the Limited
Partners to personal liability by reason of the indemnification provisions set
forth in this Agreement.
G. An Indemnitee shall not be denied indemnification in
whole or in part under this Section 7.7 because the Indemnitee had an interest
in the transaction with respect to which the indemnification applies if the
transaction was otherwise permitted by the terms of this Agreement.
H. The provisions of this Section 7.7 are for the
benefit of the Indemnitees, their heirs, successors, assigns and administrators
and shall not be deemed to create any rights for the benefit of any other
Persons. Any amendment, modification or repeal of this Section 7.7 or any
provision hereof shall be prospective only and shall not in any way affect the
limitations on the Partnership's liability to any Indemnitee under this Section
7.7 as in effect immediately prior to such amendment, modification or repeal
with respect to claims arising from or relating to matters occurring, in whole
or in part, prior to such amendment, modification or repeal, regardless of when
such claims may arise or be asserted.
I. If and to the extent any reimbursements to the
General Partner pursuant to this Section 7.7 constitute gross income of the
General Partner (as opposed to the repayment of advances made by the General
Partner on behalf of the Partnership) such amounts shall constitute guaranteed
payments within the meaning of Section 707(c) of the Code, shall be treated
consistently therewith by the Partnership and all Partners, and shall not be
treated as distributions for purposes of computing the Partners' Capital
Accounts.
J. Any indemnification hereunder is subject to, and
limited by, the provisions of Section 17-108 of the Act.
K. In the event the Partnership is made a party to any
litigation or otherwise incurs any loss or expense as a result of or in
connection with any Partner's personal obligations or liabilities unrelated to
Partnership business, such Partner shall indemnify and reimburse the Partnership
for all such loss and expense incurred, including legal fees, and the
Partnership Interest of such Partner may be charged therefor. The liability of a
Partner under this Section 7.7.K shall not be limited to such Partner's
Partnership Interest, but shall be enforceable against such Partner personally.
46
Section 7.8 Liability of the General Partner
A. Notwithstanding anything to the contrary set forth in
this Agreement, none of the General Partner and any of its officers, directors,
agents and employees shall be liable or accountable in damages or otherwise to
the Partnership, any Partners or any Assignees, or their successors or assigns,
for losses sustained, liabilities incurred or benefits not derived as a result
of errors in judgment or mistakes of fact or law or any act or omission if the
General Partner acted in good faith.
B. The Limited Partners expressly acknowledge that the
General Partner is acting for the benefit of the Partnership, the Limited
Partners and the General Partner's stockholders collectively, that the General
Partner is under no obligation to give priority to the separate interests of the
Limited Partners or the General Partner's stockholders (including, without
limitation, the tax consequences to Limited Partners or Assignees or to
stockholders) in deciding whether to cause the Partnership to take (or decline
to take) any actions and that the General Partner shall not be liable to the
Partnership or to any Limited Partner for monetary damages for losses sustained,
liabilities incurred, or benefits not derived by Limited Partners in connection
with such decisions; provided, that the General Partner has acted in good faith.
C. Subject to its obligations and duties as General
Partner set forth in Section 7.1.A, the General Partner may exercise any of the
powers granted to it by this Agreement and perform any of the duties imposed
upon it hereunder either directly or by or through its agents. The General
Partner shall not be responsible for any misconduct or negligence on the part of
any such agent appointed by it in good faith. In no event shall the liability of
the General Partner and its officers, directors, agents and employees, to the
Partnership and the Limited Partners under this Section 7.8 be greater than the
Partnership Interest of the General Partner.
D. Any amendment, modification or repeal of this Section
7.8 or any provision hereof shall be prospective only and shall not in any way
affect the limitations on the liability of the General Partner and any of its
officers, directors, agents and employees to the Partnership and the Limited
Partners under this Section 7.8 as in effect immediately prior to such
amendment, modification or repeal with respect to claims arising from or
relating to matters occurring, in whole or in part, prior to such amendment,
modification or repeal, regardless of when such claims may arise or be asserted.
Section 7.9 Other Matters Concerning the General Partner
A. The General Partner may rely and shall be protected
in acting or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, bond, debenture,
or other paper or document believed by it to be genuine and to have been signed
or presented by the proper party or parties.
B. The General Partner may consult with legal counsel,
accountants, appraisers, management consultants, investment bankers and other
consultants and advisers selected by it, and any act taken or omitted to be
taken in reliance upon the opinion of such Persons as to matters which such
General Partner reasonably believes to be within such Person's professional or
expert competence shall be conclusively presumed to have been done or omitted in
good faith and in accordance with such opinion.
47
C. The General Partner shall have the right, in respect
of any of its powers or obligations hereunder, to act through any of its duly
authorized officers and a duly appointed attorney or attorneys-in-fact. Each
such attorney shall, to the extent provided by the General Partner in the power
of attorney, have full power and authority to do and perform all and every act
and duty which is permitted or required to be done by the General Partner
hereunder.
D. Notwithstanding any other provisions of this
Agreement or any non-mandatory provision of the Act, any action of the General
Partner on behalf of the Partnership or any decision of the General Partner to
refrain from acting on behalf of the Partnership, undertaken in the good faith
belief that such action or omission is necessary or advisable in order to
protect the ability of the General Partner, for so long as the General Partner
has determined to qualify as a REIT, to (i) continue to qualify as a REIT or
(ii) except with respect to the distribution of Available Cash to the Series J
Limited Partners in accordance with Section 18.3 and to the Series K Limited
Partners in accordance with Section 19.3 avoid the General Partner incurring any
taxes under Section 857 or Section 4981 of the Code, is expressly authorized
under this Agreement and is deemed approved by all of the Limited Partners.
E. So long as the Company holds any interest in the
Partnership (as either a General Partner or Limited Partner), the Company shall
have "management rights" (as such term is defined in the Plan Asset Regulation)
with respect to the Partnership and its Properties to the extent necessary to
qualify the Company as a "venture capital operating company" (as such term is
defined in the Plan Asset Regulation).
Section 7.10 Title to Partnership Assets
Title to Partnership assets, whether real, personal or mixed
and whether tangible or intangible, shall be deemed to be owned by the
Partnership as an entity, and no Partners, individually or collectively, shall
have any ownership interest in such Partnership assets or any portion thereof.
Title to any or all of the Partnership assets may be held in the name of the
Partnership, the General Partner or one or more nominees, as the General Partner
may determine, including Affiliates of the General Partner. The General Partner
hereby declares and warrants that any Partnership assets for which legal title
is held in the name of the General Partner or any nominee or Affiliate of the
General Partner shall be deemed held by the General Partner or such nominee or
Affiliate for the use and benefit of the Partnership in accordance with the
provisions of this Agreement; provided, however, that the General Partner shall
use its best efforts to cause beneficial and record title to such assets to be
vested in the Partnership as soon as reasonably practicable. All Partnership
assets shall be recorded as the property of the Partnership in its books and
records, irrespective of the name in which legal title to such Partnership
assets is held.
Section 7.11 Reliance by Third Parties
Notwithstanding anything to the contrary in this Agreement,
any Person dealing with the Partnership shall be entitled to assume that the
General Partner has full power and authority to encumber, sell or otherwise use
in any manner any and all assets of the Partnership and to enter into any
contracts on behalf of the Partnership, and such Person shall be entitled to
deal with the General Partner as if it were the Partnership's sole party in
interest, both legally and beneficially. Each Limited Partner hereby waives any
and all defenses or other remedies which may be available against such Person to
contest, negate or disaffirm any action of the General
48
Partner in connection with any such dealing. In no event shall any Person
dealing with the General Partner or its representatives be obligated to
ascertain that the terms of this Agreement have been complied with or to inquire
into the necessity or expedience of any act or action of the General Partner or
its representatives. Each and every certificate, document or other instrument
executed on behalf of the Partnership by the General Partner or its
representatives shall be conclusive evidence in favor of any and every Person
relying thereon or claiming thereunder that (i) at the time of the execution and
delivery of such certificate, document or instrument, this Agreement was in full
force and effect, (ii) the Person executing and delivering such certificate,
document or instrument was duly authorized and empowered to do so for and on
behalf of the Partnership and (iii) such certificate, document or instrument was
duly executed and delivered in accordance with the terms and provisions of this
Agreement and is binding upon the Partnership.
ARTICLE 8.
RIGHTS AND OBLIGATIONS OF LIMITED PARTNERS
Section 8.1 Limitation of Liability
The Limited Partners shall have no liability under this
Agreement except as expressly provided in this Agreement or under the Act.
Section 8.2 Management of Business
No Limited Partner or Assignee (other than the General
Partner, any of its Affiliates or any officer, director, employee, general
partner, agent or trustee of the General Partner, the Partnership or any of
their Affiliates, in their capacity as such) shall take part in the operations,
management or control (within the meaning of the Act) of the Partnership's
business, transact any business in the Partnership's name or have the power to
sign documents for or otherwise bind the Partnership. The transaction of any
such business by the General Partner, any of its Affiliates or any officer,
director, employee, general partner, agent or trustee of the General Partner,
the Partnership or any of their Affiliates, in their capacity as such, shall not
affect, impair or eliminate the limitations on the liability of the Limited
Partners or Assignees under this Agreement.
Section 8.3 Outside Activities of Limited Partners
Subject to any agreements entered into by a Limited Partner or
its Affiliates with the General Partner, Partnership or a Subsidiary, any
Limited Partner and any officer, director, employee, agent, trustee, Affiliate
or stockholder of any Limited Partner shall be entitled to and may have business
interests and engage in business activities in addition to those relating to the
Partnership, including business interests and activities in direct competition
with the Partnership or that are enhanced by the activities of the Partnership.
Neither the Partnership nor any Partners shall have any rights by virtue of this
Agreement in any business ventures of any Limited Partner or Assignee. Subject
to such agreements, none of the Limited Partners nor any other Person shall have
any rights by virtue of this Agreement or the partnership relationship
established hereby in any business ventures of any other Person, other than the
Limited Partners benefiting from the business conducted by the General Partner,
and such other Person shall have no obligation pursuant to this Agreement to
offer any interest in any such business ventures to the Partnership, any Limited
Partner or any such other Person, even if such opportunity is of a
49
character which, if presented to the Partnership, any Limited Partner or such
other Person, could be taken by such other Person.
Section 8.4 Return of Capital
Except pursuant to the rights of Redemption set forth in
Section 8.6 and the redemption and exchange rights set forth in Sections 18.5,
18.8 19.5 and 19.8, no Limited Partner shall be entitled to the withdrawal or
return of his or her Capital Contribution, except to the extent of distributions
made pursuant to this Agreement or upon termination of the Partnership as
provided herein. Except as expressly set forth herein with respect to the
rights, priorities and preferences of the Preferred Limited Partners holding any
series of Preferred Units, no Limited Partner or Assignee shall have priority
over any other Limited Partner or Assignee either as to the return of Capital
Contributions, or as otherwise expressly provided in this Agreement, as to
profits, losses, distributions or credits.
Section 8.5 Rights of Limited Partners Relating to the
Partnership
A. In addition to other rights provided by this
Agreement or by the Act, and except as limited by Section 8.5.C, each Limited
Partner shall have the right, for a purpose reasonably related to such Limited
Partner's interest as a limited partner in the Partnership, upon written demand
with a statement of the purpose of such demand and at the Partnership's expense:
(i) to obtain a copy of the most recent annual and
quarterly reports filed with the Securities and
Exchange Commission by the General Partner pursuant
to the Exchange Act, and each communication sent to
the stockholders of the General Partner;
(ii) to obtain a copy of the Partnership's Federal, state
and local income tax returns for each Partnership
Year;
(iii) to obtain a current list of the name and last known
business, residence or mailing address of each
Partner;
(iv) to obtain a copy of this Agreement and the
Certificate and all amendments thereto, together with
executed copies of all powers of attorney pursuant to
which this Agreement, the Certificate and all
amendments thereto have been executed; and
(v) to obtain true and full information regarding the
amount of cash and a description and statement of any
other property or services contributed by each
Partner and which each Partner has agreed to
contribute in the future, and the date on which each
became a Partner.
B. The Partnership shall notify each Common Limited
Partner in writing of any adjustment made in the calculation of the REIT Shares
Amount within ten (10) Business Days of the date such change becomes effective.
50
C. Notwithstanding any other provision of this Section
8.5, the General Partner may keep confidential from the Limited Partners, for
such period of time as the General Partner determines in its sole and absolute
discretion to be reasonable, any information that (i) the General Partner
believes to be in the nature of trade secrets or other information the
disclosure of which the General Partner in good faith believes is not in the
best interests of the Partnership or (ii) the Partnership or the General Partner
is required by law or by agreements with unaffiliated third parties to keep
confidential.
Section 8.6 Common Limited Partner Redemption Rights
A. On or after the date one year after the Effective
Date, or on or after such later date as expressly provided in an agreement
entered into between the Partnership and any Common Limited Partner, each Common
Limited Partner shall have the right (subject to the terms and conditions set
forth herein and in any other such agreement, as applicable) to require the
Partnership to redeem all or a portion of the Common Partnership Units held by
such Common Limited Partner (such Partnership Units being hereafter referred to
as "Tendered Units") in exchange for the Cash Amount (a "Redemption"); provided,
that the terms of such Common Partnership Units do not provide that such Common
Partnership Units are not entitled to a right of Redemption. Unless otherwise
expressly provided in this Agreement or a separate agreement entered into
between the Partnership and the holders of such Partnership Units, all Common
Partnership Units shall be entitled to a right of Redemption hereunder.
Notwithstanding the foregoing, a PLP shall not have the right to require the
Partnership to redeem, and the Partnership may not redeem, (i) a number of
Performance Units held by such PLP in excess of the Performance Amount; or (ii)
any Performance Units prior to the second anniversary of their issuance. Any
Redemption shall be exercised pursuant to a Notice of Redemption delivered to
the General Partner by the Common Limited Partner who is exercising the right
(the "Tendering Partner"). The Cash Amount shall be delivered as a certified
check payable to the Tendering Partner within ten (10) days of the Specified
Redemption Date in accordance with the instructions set forth in the Notice of
Redemption.
B. Notwithstanding Section 8.6.A above, if a Common
Limited Partner has delivered to the General Partner a Notice of Redemption then
the General Partner may, in its sole and absolute discretion, (subject to the
limitations on ownership and transfer of REIT Shares set forth in Article IV.E
of the Charter) elect to acquire some or all of the Tendered Units from the
Tendering Partner in exchange for the REIT Shares Amount (as of the Specified
Redemption Date) and, if the General Partner so elects, the Tendering Partner
shall sell the Tendered Units to the General Partner in exchange for the REIT
Shares Amount. In such event, the Tendering Partner shall have no right to cause
the Partnership to redeem such Tendered Units. The General Partner shall
promptly give such Tendering Partner written notice of its election, and the
Tendering Partner may elect to withdraw its redemption request at any time prior
to the acceptance of the Cash Amount or REIT Shares Amount by such Tendering
Partner.
C. The REIT Shares Amount, if applicable, shall be
delivered as duly authorized, validly issued, fully paid and nonassessable REIT
Shares and, if applicable, free of any pledge, lien, encumbrance or restriction,
other than those provided in the Charter, the Bylaws of the General Partner, the
Securities Act, relevant state securities or blue sky laws and any applicable
registration rights agreement with respect to such REIT Shares entered into by
the Tendering Partner. The REIT Shares Amount shall be registered in the name
and otherwise
51
delivered as set forth in the Notice of Redemption. Notwithstanding any delay in
such delivery (but subject to Section 8.6.E below), the Tendering Partner shall
be deemed the owner of such REIT Shares for all purposes, including without
limitation, rights to vote or consent, and receive dividends, as of the
Specified Redemption Date.
D. Each Common Limited Partner covenants and agrees with
the General Partner that all Tendered Units shall be delivered to the General
Partner free and clear of all liens, claims and encumbrances whatsoever and
should any such liens, claims and/or encumbrances exist or arise with respect to
such Tendered Units, the General Partner shall be under no obligation to acquire
the same. Each Common Limited Partner further agrees that, in the event any
state or local property transfer tax is payable as a result of the transfer of
its Tendered Units to the General Partner (or its designee), such Common Limited
Partner shall assume and pay such transfer tax.
E. Notwithstanding the provisions of Sections 8.6.A,
8.6.B, 8.6.C or any other provision of this Agreement, a Common Limited Partner
(i) shall not be entitled to effect a Redemption for cash or an exchange for
REIT Shares to the extent the ownership or right to acquire REIT Shares pursuant
to such exchange by such Partner on the Specified Redemption Date would cause
such Partner or any other Person, or, in the opinion of counsel selected by the
General Partner, may cause such Partner or any other Person, to violate the
restrictions on ownership and transfer of REIT Shares set forth in Article IV.E
of the Charter and (ii) shall have no rights under this Agreement to acquire
REIT Shares which would otherwise be prohibited under the Charter. To the extent
any attempted Redemption or exchange for REIT Shares would be in violation of
this Section 8.6.E, it shall be null and void ab initio and such Common Limited
Partner shall not acquire any rights or economic interest in the cash otherwise
payable upon such redemption or the REIT Shares otherwise issuable upon such
exchange.
F. Notwithstanding anything herein to the contrary (but
subject to Section 8.6.E above), with respect to any Redemption or exchange for
REIT Shares pursuant to this Section 8.6:
(i) All Common Partnership Units acquired by the General
Partner pursuant thereto shall automatically, and
without further action required, be converted into
and deemed to be General Partner Interests comprised
of the same number and class of Common Partnership
Units.
(ii) Without the consent of the General Partner, each
Common Limited Partner may not effect a Redemption
for less than 10,000 Partnership Units or, if the
Common Limited Partner holds less than 10,000
Partnership Units, all of the Common Partnership
Units held by such Common Limited Partner.
(iii) Without the consent of the General Partner, each
Common Limited Partner may not effect a Redemption
during the period after the Partnership Record Date
with respect to a distribution and before the record
date established by the General Partner for a
distribution to its common stockholders of some or
all of its portion of such distribution.
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(iv) The consummation of any Redemption or exchange for
REIT Shares shall be subject to the expiration or
termination of the applicable waiting period, if any,
under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements
Act of 1976, as amended.
(v) Each Tendering Partner shall continue to own all
Common Partnership Units subject to any Redemption or
exchange for REIT Shares, and be treated as a Common
Limited Partner with respect to such Common
Partnership Units for all purposes of this Agreement,
until such Common Partnership Units are transferred
to the General Partner and paid for or exchanged as
of the Specified Redemption Date. Until a Specified
Redemption Date, the Tendering Partner shall have no
rights as a stockholder of the General Partner with
respect to such Tendering Partner's Common
Partnership Units.
G. In the event that the Partnership issues additional
Partnership Interests to any Additional Limited Partner pursuant to Section
4.3.C, the General Partner shall make such revisions to this Section 8.6 as it
determines are necessary to reflect the issuance of such additional Partnership
Interests.
ARTICLE 9.
BOOKS, RECORDS, ACCOUNTING AND REPORTS
Section 9.1 Records and Accounting
The General Partner shall keep or cause to be kept at the
principal office of the Partnership appropriate books and records with respect
to the Partnership's business, including without limitation, all books and
records necessary to provide to the Limited Partners any information, lists and
copies of documents required to be provided pursuant to Section 9.3. Any records
maintained by or on behalf of the Partnership in the regular course of its
business may be kept on, or be in the form of, punch cards, magnetic tape,
photographs, micrographics or any other information storage device; provided,
that the records so maintained are convertible into clearly legible written form
within a reasonable period of time. The books of the Partnership shall be
maintained, for financial and tax reporting purposes, on an accrual basis in
accordance with generally accepted accounting principles.
Section 9.2 Fiscal Year
The fiscal year of the Partnership shall be the calendar year.
Section 9.3 Reports
A. As soon as practicable, but in no event later than
one hundred and five (105) days after the close of each Partnership Year, or
such earlier date as they are filed with the Securities and Exchange Commission,
the General Partner shall cause to be mailed to each Limited Partner as of the
close of the Partnership Year, an annual report containing financial statements
of the Partnership, or of the General Partner if such statements are prepared
solely on a consolidated basis with the General Partner, for such Partnership
Year, presented in accordance
53
with generally accepted accounting principles, such statements to be audited by
a nationally recognized firm of independent public accountants selected by the
General Partner.
B. As soon as practicable, but in no event later than
forty-five (45) days after the close of each calendar quarter (except the last
calendar quarter of each year), or such earlier date as they are filed with the
Securities and Exchange Commission, the General Partner shall cause to be mailed
to each Limited Partner as of the last day of the calendar quarter, a report
containing unaudited financial statements of the Partnership, or of the General
Partner, if such statements are prepared solely on a consolidated basis with the
General Partner, presented in accordance with the applicable law or regulation,
or as the General Partner determines to be appropriate.
Section 9.4 Nondisclosure of Certain Information
Notwithstanding the provisions of Sections 9.1 and 9.3, the
General Partner may keep confidential from the Limited Partners any information
that the General Partner believes to be in the nature of trade secrets or other
information the disclosure of which the General Partner in good faith believes
is not in the best interests of the Partnership or which the Partnership is
required by law or by agreements with unaffiliated third parties to keep
confidential.
ARTICLE 10.
TAX MATTERS
Section 10.1 Preparation of Tax Returns
The General Partner shall arrange for the preparation and
timely filing of all returns of Partnership income, gains, deductions, losses
and other items required of the Partnership for Federal and state income tax
purposes and shall use all reasonable efforts to furnish, within ninety (90)
days of the close of each taxable year, the tax information reasonably required
by Limited Partners for Federal and state income tax reporting purposes. Each
Limited Partner shall promptly provide the General Partner with such information
relating to any Contributed Property contributed by such Limited Partner to the
Partnership.
Section 10.2 Tax Elections
Except as otherwise provided herein, the General Partner
shall, in its sole and absolute discretion, determine whether to make any
available election pursuant to the Code, including the election under Section
754 of the Code. The General Partner shall have the right to seek to revoke any
such election (including without limitation, any election under Section 754 of
the Code) upon the General Partner's determination in its sole and absolute
discretion that such revocation is the best interests of the Partners.
Section 10.3 Tax Matters Partner
A. The General Partner shall be the "tax matters
partner" of the Partnership for Federal income tax purposes. Pursuant to Section
6223(c) of the Code, upon receipt of notice from the IRS of the beginning of an
administrative proceeding with respect to the Partnership, the tax matters
partner shall furnish the IRS with the name, address and profit interest of each
of
54
the Limited Partners and Assignees; provided, however, that such information is
provided to the Partnership by the Limited Partners and Assignees.
B. The tax matters partner is authorized, but not
required:
(i) to enter into any settlement with the IRS with
respect to any administrative or judicial proceedings
for the adjustment of Partnership items required to
be taken into account by a Partner for income tax
purposes (such administrative proceedings being
referred to as a "tax audit" and such judicial
proceedings being referred to as "judicial review"),
and in the settlement agreement the tax matters
partner may expressly state that such agreement shall
bind all Partners, except that such settlement
agreement shall not bind any Partner (a) who (within
the time prescribed pursuant to the Code and
Regulations) files a statement with the IRS providing
that the tax matters partner shall not have the
authority to enter into a settlement agreement on
behalf of such Partner or (b) who is a "notice
partner" (as defined in Section 6231 of the Code) or
a member of a "notice group" (as defined in Section
6223(b)(2) of the Code);
(ii) in the event that a notice of a final administrative
adjustment at the Partnership level of any item
required to be taken into account by a Partner for
tax purposes (a "final adjustment") is mailed to the
tax matters partner, to seek judicial review of such
final adjustment, including the filing of a petition
for readjustment with the Tax Court or the United
States Claims Court, or the filing of a complaint for
refund with the District Court of the United States
for the district in which the Partnership's principal
place of business is located;
(iii) to intervene in any action brought by any other
Partner for judicial review of a final adjustment;
(iv) to file a request for an administrative adjustment
with the IRS at any time and, if any part of such
request is not allowed by the IRS, to file an
appropriate pleading (petition or complaint) for
judicial review with respect to such request;
(v) to enter into an agreement with the IRS to extend the
period for assessing any tax which is attributable to
any item required to be taken into account by a
Partner for tax purposes, or an item affected by such
item; and
(vi) to take any other action on behalf of the Partners of
the Partnership in connection with any tax audit or
judicial review proceeding to the extent permitted by
applicable law or regulations.
The taking of any action and the incurring of any expense by
the tax matters partner in connection with any such proceeding, except to the
extent required by law, is a matter in the sole and absolute discretion of the
tax matters partner and the provisions relating to indemnification of the
General Partner set forth in Section 7.7 shall be fully applicable to the tax
matters partner in its capacity as such.
55
C. The tax matters partner shall receive no compensation
for its services. All third party costs and expenses incurred by the tax matters
partner in performing its duties as such (including legal and accounting fees)
shall be borne by the Partnership. Nothing herein shall be construed to restrict
the Partnership from engaging an accounting firm to assist the tax matters
partner in discharging its duties hereunder, so long as the compensation paid by
the Partnership for such services is reasonable.
Section 10.4 Organizational Expenses
The Partnership shall elect to deduct expenses, if any,
incurred by it in organizing the Partnership ratably over a sixty (60) month
period as provided in Section 709 of the Code.
Section 10.5 Withholding
Each Limited Partner hereby authorizes the Partnership to
withhold from or pay on behalf of or with respect to such Limited Partner any
amount of Federal, state, local, or foreign taxes that the General Partner
determines that the Partnership is required to withhold or pay with respect to
any amount distributable or allocable to such Limited Partner pursuant to this
Agreement, including, without limitation, any taxes required to be withheld or
paid by the Partnership pursuant to Sections 1441, 1442, 1445 or 1446 of the
Code. Any amount paid on behalf of or with respect to a Limited Partner shall
constitute a loan by the Partnership to such Limited Partner, which loan shall
be repaid by such Limited Partner within fifteen (15) days after notice from the
General Partner that such payment must be made unless (i) the Partnership
withholds such payment from a distribution which would otherwise be made to the
Limited Partner or (ii) the General Partner determines, in its sole and absolute
discretion, that such payment may be satisfied out of the available funds of the
Partnership which would, but for such payment, be distributed to the Limited
Partner. Any amounts withheld pursuant to the foregoing clauses (i) or (ii)
shall be treated as having been distributed to such Limited Partner. Each
Limited Partner hereby unconditionally and irrevocably grants to the Partnership
a security interest in such Limited Partner's Partnership Interest to secure
such Limited Partner's obligation to pay to the Partnership any amounts required
to be paid pursuant to this Section 10.5. In the event that a Limited Partner
fails to pay any amounts owed to the Partnership pursuant to this Section 10.5
when due, the General Partner may, in its sole and absolute discretion, elect to
make the payment to the Partnership on behalf of such defaulting Limited
Partner, and in such event shall be deemed to have loaned such amount to such
defaulting Limited Partner and shall succeed to all rights and remedies of the
Partnership as against such defaulting Limited Partner (including, without
limitation, the right to receive distributions and the holding of a security
interest in such Limited Partner's Partnership Interest). Any amounts payable by
a Limited Partner hereunder shall bear interest at the base rate on corporate
loans at large United States money center commercial banks, as published from
time to time in the Wall Street Journal, plus two percentage points (but not
higher than the maximum lawful rate) from the date such amount is due (i.e., 15
days after demand) until such amount is paid in full. Each Limited Partner shall
take such actions as the Partnership or the General Partner shall request in
order to perfect or enforce the security interest created hereunder.
56
ARTICLE 11.
TRANSFERS AND WITHDRAWALS
Section 11.1 Transfer
A. The term "transfer," when used in this Article 11
with respect to a Partnership Interest, shall be deemed to refer to a
transaction by which the General Partner purports to assign its General Partner
Interest to another Person or by which a Limited Partner purports to assign its
Limited Partnership Interest to another Person, and includes a sale, assignment,
gift (outright or in trust), pledge, encumbrance, hypothecation, mortgage,
exchange or any other disposition by law or otherwise. Except to the extent
otherwise specified, the term "transfer" when used in this Article 11 does not
include any Redemption or exchange for REIT Shares pursuant to Section 8.6, any
redemption of Preferred Units pursuant to Sections 18.5, 19.5, 20.5 or 21.5 or
any exchange for Preferred Shares pursuant to Section 18.8 or 19.8. No part of
the interest of a Limited Partner shall be subject to the claims of any
creditor, any spouse for alimony or support, or to legal process, and may not be
voluntarily or involuntarily alienated or encumbered, except as may be
specifically provided for in this Agreement.
B. No Partnership Interest shall be transferred, in
whole or in part, except in accordance with the terms and conditions set forth
in this Article 11. Any transfer or purported transfer of a Partnership Interest
not made in accordance with this Article 11 shall be null and void ab initio
unless otherwise consented by the General Partner in its sole and absolute
discretion.
Section 11.2 Transfer of General Partner's Partnership
Interest
A. The General Partner shall not withdraw from the
Partnership and shall not transfer all or any portion of its interest in the
Partnership (whether by sale, statutory merger, consolidation, liquidation or
otherwise) without the Consent of the Limited Partners which may be given or
withheld by each such Limited Partner in its sole and absolute discretion, and
only upon the admission of a successor General Partner pursuant to Section 12.1;
provided, however, that, subject to Sections 11.2.B, 11.2.C, 11.2.D and 11.2.E,
the General Partner may withdraw from the Partnership and transfer all of its
interest upon the merger, consolidation or sale of substantially all of the
assets of the General Partner without the consent of any Limited Partners. Upon
any transfer of a Partnership Interest in accordance with the provisions of this
Section 11.2, the transferee shall become a substitute General Partner for all
purposes herein, and shall be vested with the powers and rights of the
transferor General Partner, and shall be liable for all obligations and
responsible for all duties of the General Partner, once such transferee has
executed such instruments as may be necessary to effectuate such admission and
to confirm the agreement of such transferee to be bound by all the terms and
provisions of this Agreement with respect to the Partnership Interest so
acquired. It is a condition to any transfer otherwise permitted hereunder that
the transferee assumes, by operation of law or express agreement, all of the
obligations of the transferor General Partner under this Agreement with respect
to such transferred Partnership Interest, and no such transfer (other than
pursuant to a statutory merger or consolidation wherein all obligations and
liabilities of the transferor General Partner are assumed by a successor
corporation by operation of law) shall relieve the transferor General Partner of
its obligations under this Agreement without the Consent of the Partners, in
their reasonable discretion. In the event the General Partner withdraws from the
Partnership, or otherwise
57
dissolves or terminates, or upon the Incapacity of the General Partner, all of
the remaining Partners may elect to continue the Partnership business by
selecting a substitute General Partner in accordance with the Act.
B. Neither the General Partner nor the Partnership may
engage in any merger, consolidation or other combination with or into another
person, or effect any reclassification, recapitalization or change of its
outstanding equity interests, and the General Partner may not sell all or
substantially all of its assets (each a "Termination Transaction") unless in
connection with the Termination Transaction all holders of Partnership Units
either will receive, or will have the right to elect to receive, for each
Partnership Unit an amount of cash, securities or other property equal to the
product of the REIT Share Amount and the greatest amount of cash, securities or
other property paid to the holder of one REIT Share in consideration of one REIT
Share pursuant to the Termination Transaction. If, in connection with the
Termination Transaction, a purchase, tender or exchange offer shall have been
made to and accepted by the holders of the outstanding REIT Shares, each holder
of Partnership Units will receive, or will have the right to elect to receive,
the greatest amount of cash, securities or other property which such holder
would have received had it exercised its rights to Redemption (as set forth in
Section 8.6) and received REIT Shares in exchange for its Partnership Units
immediately prior to the expiration of such purchase, tender or exchange offer
and had thereupon accepted such purchase, tender or exchange offer. The PLPs
shall have the benefit of the foregoing provisions with respect to all of their
Performance Units, notwithstanding the limitation set forth in Section 8.6.A on
a PLPs ability to exercise its rights to a Redemption.
C. A Termination Transaction may also occur if the
following conditions are met: (i) substantially all of the assets directly or
indirectly owned by the surviving entity are held directly or indirectly by the
Partnership or another limited partnership or limited liability company which is
the survivor of a merger, consolidation or combination of assets with the
Partnership (in each case, the "Surviving Partnership"); (ii) the holders of
Partnership Units, including the holders of Performance Units issued or to be
issued, own a percentage interest of the Surviving Partnership based on the
relative fair market value of the net assets of the Partnership and the other
net assets of the Surviving Partnership immediately prior to the consummation of
such transaction; (iii) the rights, preferences and privileges of such holders
in the Surviving Partnership, including the holders of Performance Units issued
or to be issued, are at least as favorable as those in effect immediately prior
to the consummation of such transaction and as those applicable to any other
limited partners or non-managing members of the Surviving Partnership (except,
as to Performance Units, for such differences with Partnership Units regarding
liquidation, Redemption and exchange as are set forth herein); and (iv) such
rights of the Limited Partners, including the holders of Performance Units
issued or to be issued, include at least one of the following: (a) the right to
redeem their interests in the Surviving Partnership for the consideration
available to such persons pursuant to Section 11.2.B; or (b) the right to redeem
their Partnership Units for cash on terms equivalent to those in effect with
respect to their Partnership Units immediately prior to the consummation of such
transaction, or, if the ultimate controlling person of the Surviving Partnership
has publicly traded common equity securities, such common equity securities,
with an exchange ratio based on the determination of relative fair market value
of such securities and the REIT Shares.
D. In connection with any transaction permitted by
Section 11.2.B or 11.2.C the determination of relative fair market values and
rights, preferences and privileges of the
58
Limited Partners shall be reasonably determined by the General Partner's Board
of Directors as of the time of the Termination Transaction and, to the extent
applicable, the values shall be no less favorable to the holders of Partnership
Units than the relative values reflected in the terms of the Termination
Transaction.
E. In the event of a Termination Transaction, the
arrangements with respect to Performance Units and Performance Shares will be
equitably adjusted to reflect the terms of the transaction, including, to the
extent that the REIT Shares are exchanged for consideration other than publicly
traded common equity, the transfer or release of remaining Performance Shares
pursuant to the Escrow Agreements, and resulting issuance of any Performance
Units as set forth in Section 4.3.F.
Section 11.3 Limited Partners' Rights to Transfer
A. Any Limited Partner may, at any time without the
consent of the General Partner, (i) transfer all or any portion of its
Partnership Interest to the General Partner, (ii) transfer all or any portion of
its Partnership Interest to an Affiliate controlled thereby or to an Immediate
Family member, subject to the provisions of Section 11.6, (iii) transfer all or
any portion of its Partnership Interest to a trust for the benefit of a
charitable beneficiary or to a charitable foundation, subject to the provisions
of Section 11.6 and (iv) subject to the provisions of Section 11.6, (a) pledge
(a "Pledge") all or any portion of its Partnership Interest to a lending
institution, which is not an Affiliate of such Limited Partner, as collateral or
security for a bona fide loan or other extension of credit, or (b) transfer such
pledged Partnership Interest to such lending institution in connection with the
exercise of remedies under such loan or extension of credit. In addition, each
Limited Partner or Assignee (resulting from a transfer made pursuant to clauses
(i)-(iv) of the preceding sentence) shall have the right to transfer all or any
portion of its Partnership Interest, subject to the provisions of Section 11.6
and the satisfaction of each of the following conditions:
(a) General Partner Right of First Refusal. The
transferring Partner shall give written notice of the
proposed transfer to the General Partner, which
notice shall state (x) the identity of the proposed
transferee and (y) the amount and type of
consideration proposed to be received for the
transferred Partnership Units. The General Partner
shall have ten (10) days upon which to give the
transferring Partner notice of its election to
acquire the Partnership Units on the proposed terms.
If it so elects, it shall purchase the Partnership
Units on such terms within ten (10) days after giving
notice of such election. If it does not so elect, the
transferring Partner may transfer such Partnership
Units to a third party, on economic terms no more
favorable to the transferee than the proposed terms,
subject to the other conditions of this Section 11.3.
(b) Qualified Transferee. Any transfer of a Partnership
Interest shall be made only to Qualified Transferees.
It is a condition to any transfer otherwise permitted
hereunder that the transferee assumes by operation of law or express agreement
all of the obligations of the transferor Limited Partner under this Agreement
with respect to such transferred Partnership Interest and no such transfer
(other than pursuant to a statutory merger or consolidation wherein all
obligations and
59
liabilities of the transferor Partner are assumed by a successor corporation by
operation of law) shall relieve the transferor Partner of its obligations under
this Agreement without the approval of the General Partner, in its reasonable
discretion. Notwithstanding the foregoing, any transferee of any transferred
Partnership Interest shall be subject to any and all ownership limitations
contained in the Charter, which may limit or restrict such transferee's ability
to exercise its exchange rights set forth in Sections 18.8 and 19.8 and to the
representations set forth in Section 3.4.D. Any transferee, whether or not
admitted as a Substituted Limited Partner, shall take subject to the obligations
of the transferor hereunder. Unless admitted as a Substituted Limited Partner,
no transferee, whether by a voluntary transfer, by operation of law or
otherwise, shall have any rights hereunder, other than the rights of an Assignee
as provided in Section 11.5.
B. If a Limited Partner is subject to Incapacity, the
executor, administrator, trustee, committee, guardian, conservator, or receiver
of such Limited Partner's estate shall have all the rights of a Limited Partner,
but not more rights than those enjoyed by other Limited Partners, for the
purpose of settling or managing the estate, and such power as the Incapacitated
Limited Partner possessed to transfer all or any part of his or its interest in
the Partnership. The Incapacity of a Limited Partner, in and of itself, shall
not dissolve or terminate the Partnership.
C. The General Partner may prohibit any transfer
otherwise permitted under this Section 11.3 by a Limited Partner of his or her
Partnership Units if, in the opinion of legal counsel to the Partnership, such
transfer would require the filing of a registration statement under the
Securities Act by the Partnership or would otherwise violate any Federal or
state securities laws or regulations applicable to the Partnership or the
Partnership Unit.
D. No transfer by a Limited Partner of his or her
Partnership Units (including any Redemption or exchange for REIT Shares pursuant
to Section 8.6, the redemption or exchange rights set forth in Sections 18.5 and
18.8 or Sections 19.5 and 19.8, or any other acquisition of Common Units, Series
J Preferred Partnership Units and Series K Preferred Partnership Units by the
General Partner or the Partnership) may be made to any person if (i) in the
opinion of legal counsel for the Partnership, it could result in the Partnership
being treated as an association taxable as a corporation or (ii) absent the
consent of the General Partner, which may be given or withheld in its sole and
absolute discretion, such transfer could be treated as effectuated through an
"established securities market" or a "secondary market (or the substantial
equivalent thereof)" within the meaning of Section 7704 of the Code.
E. No transfer of any Partnership Units may be made to a
lender to the Partnership or any Person who is related (within the meaning of
Section 1.752-4(b) of the Regulations) to any lender to the Partnership whose
loan constitutes a Nonrecourse Liability, without the consent of the General
Partner, in its sole and absolute discretion; provided, that as a condition to
such consent, the lender will be required to enter into an arrangement with the
Partnership and the General Partner to redeem or exchange for the REIT Shares
Amount, or the specified amount of Series J Preferred Shares and Series K
Preferred Shares, as the case may be, any Partnership Units in which a security
interest is held simultaneously with the time at which such lender would be
deemed to be a partner in the Partnership for purposes of allocating liabilities
to such lender under Section 752 of the Code.
F. No Limited Partner may withdraw from the Partnership
except as a result of transfer, Redemption or exchange of Partnership Units
pursuant hereto.
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G. No PLP (or any transferee described below) shall be
entitled to transfer any Performance Units prior to the second anniversary of
their issuance, without the consent of the General Partner, which may be given
or withheld in its sole discretion; provided, however, no such consent shall be
required under this Section 11.3.G (but subject to the other limitations of this
Article 11) for a transfer of all or a portion of such Performance Units to an
Affiliate, to Immediate Family Members, to a trust described in Section
11.3.A(iii), pursuant to a Pledge, or a transfer of such pledged units to such
lending institution in connection with the exercise of remedies under such loan
or extension of credit.
Section 11.4 Substituted Limited Partners
A. No Limited Partner shall have the right to substitute
a transferee as a Limited Partner in his or her place (including any transferee
permitted by Section 11.3 above). The General Partner shall, however, have the
right to consent to the admission of a permitted transferee of the interest of a
Limited Partner, as a Substituted Limited Partner, pursuant to this Section
11.4, which consent may be given or withheld by the General Partner in its sole
and absolute discretion. The General Partner's failure or refusal to permit a
transferee of any such interests to become a Substituted Limited Partner shall
not give rise to any cause of action against the Partnership or any Partner.
B. A transferee who has been admitted as a Substituted
Limited Partner in accordance with this Article 11 shall have all the rights and
powers and be subject to all the restrictions and liabilities of a Limited
Partner under this Agreement. The admission of any transferee as a Substituted
Limited Partner shall be subject to the transferee executing and delivering to
the Partnership an acceptance of all of the terms and conditions of this
Agreement (including, without limitation, the provisions of Section 2.4 and such
other documents or instruments as may be required to effect the admission, each
in form and substance satisfactory to the General Partner) and the
acknowledgment by such transferee that each of the representations and
warranties set forth in Section 3.4 are true and correct with respect to such
transferee as of the date of the transfer of the Partnership Interest to such
transferee and will continue to be true to the extent required by such
representations and warranties.
C. Upon the admission of a Substituted Limited Partner,
the General Partner shall amend Exhibit A to reflect the name, address, number
of Partnership Units, and Percentage Interest of such Substituted Limited
Partner and to eliminate or adjust, if necessary, the name, address and interest
of the predecessor of such Substituted Limited Partner.
Section 11.5 Assignees
If the General Partner, in its sole and absolute discretion,
does not consent to the admission of any permitted transferee under Section 11.3
as a Substituted Limited Partner, as described in Section 11.4, such transferee
shall be considered an Assignee for purposes of this Agreement. An Assignee
shall be entitled to all the rights of an assignee of a limited partnership
interest under the Act, including the right to receive distributions from the
Partnership and the share of Net Income, Net Losses, gain and loss attributable
to the Partnership Units assigned to such transferee, the rights to transfer the
Partnership Units provided in this Article 11, the right of Redemption provided
in Section 8.6, the right of exchange for Series J Preferred Shares set forth in
Section 18.8 and the right of exchange for Series K Preferred Shares set forth
in Section
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19.8, but shall not be deemed to be a holder of Partnership Units for any other
purpose under this Agreement, and shall not be entitled to effect a Consent with
respect to such Partnership Units on any matter presented to the Limited
Partners for approval (such Consent remaining with the transferor Limited
Partner). In the event any such transferee desires to make a further assignment
of any such Partnership Units, such transferee shall be subject to all the
provisions of this Article 11 to the same extent and in the same manner as any
Limited Partner desiring to make an assignment of Partnership Units.
Notwithstanding anything contained in this Agreement to the contrary, as a
condition to becoming an Assignee, any prospective Assignee must first execute
and deliver to the Partnership an acknowledgment that each of the
representations and warranties set forth in Section 3.4 hereof are true and
correct with respect to such prospective Assignee as of the date of the
prospective assignment of the Partnership Interest to such prospective Assignee
and will continue to be true to the extent required by such representations or
warranties.
Section 11.6 General Provisions
A. No Limited Partner may withdraw from the Partnership
other than (i) as a result of a permitted transfer of all of such Limited
Partner's Partnership Units in accordance with this Article 11 and the
transferee(s) of such Units being admitted to the Partnership as a Substituted
Limited Partner(s) or (ii) pursuant to the exercise of its right of Redemption
of all of such Limited Partner's Partnership Units under Section 8.6, its right
of exchange of all of such Limited Partner's Series J Preferred Units under
Section 18.8 or its right of exchange of all of such Limited Partner's Series K
Preferred Units under Section 19.8, or upon the redemption of all of such
Limited Partner's Series J Preferred Units pursuant to Section 18.5 or the
redemption of all of such Limited Partner's Series K Preferred Units pursuant to
Section 19.5; provided that after such transfer, exchange or redemption such
Limited Partner owns no Partnership Units.
B. Any Limited Partner who shall assign all of such
Limited Partner's Partnership Units (i) in a transfer permitted pursuant to this
Article 11 where such transferee was admitted as a Substituted Limited Partner,
(ii) pursuant to the exercise of (1) its rights of Redemption of all of such
Limited Partner's Partnership Units under Section 8.6, (2) its right of exchange
of all of such Limited Partner's Series J Preferred Units under Section 18.8 or
(3) its right of exchange of all of such Limited Partner's Series K Preferred
Units under Section 19.8, or (iii) upon the redemption of all of such Limited
Partner's Series J Preferred Units pursuant to Section 18.5 or the redemption of
all of such Limited Partner's Series K Preferred Units pursuant to Section 19.5
shall cease to be a Limited Partner; provided that after such transfer, exchange
or redemption such Limited Partner owns no Partnership Units.
C. Transfers pursuant to this Article 11 may only be
made effective on the last day of the month set forth on the written instrument
of transfer, unless the General Partner otherwise agrees.
D. If any Partnership Interest is transferred, assigned
or redeemed during any quarterly segment of the Partnership's fiscal year in
compliance with the provisions of this Article 11 or transferred or redeemed
pursuant to Sections 8.6, 18.5 or 19.5, on any day other than the first day of a
Partnership Year, then Net Income, Net Losses, each item thereof and all other
items attributable to such Partnership Interest for such fiscal year shall be
divided and allocated between the transferor Partner and the transferee Partner
by taking into account their
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varying interests during the fiscal year in accordance with Section 706(d) of
the Code, using the interim closing of the books method. Except as otherwise
required by Section 706(d) of the Code or as otherwise specified in this
Agreement or as otherwise determined by the General Partner (to the extent
consistent with Section 706(d) of the Code), solely for purposes of making such
allocations, each of such items for the calendar month in which the transfer,
assignment or redemption occurs shall be allocated among all the Partners and
Assignees in a manner determined by the General Partner in its sole discretion.
E. In addition to any other restrictions on transfer
herein contained, including without limitation the provisions of this Article 11
and Section 2.6, in no event may any transfer or assignment of a Partnership
Interest by any Partner (including by way of a Redemption or exchange for Series
J Preferred Shares or Series K Preferred Shares, or any other acquisition of
Common Units, Series J Preferred Units or Series K Preferred Units by the
Partnership or the General Partner) be made (i) to any person or entity who
lacks the legal right, power or capacity to own a Partnership Interest; (ii) in
violation of applicable law; (iii) except with the consent of the General
Partner, which may be given or withheld in its sole and absolute discretion, of
any component portion of a Partnership Interest, such as the Capital Account, or
rights to distributions, separate and apart from all other components of a
Partnership Interest; (iv) except with the consent of the General Partner, which
may be given or withheld in its sole and absolute discretion, if in the opinion
of legal counsel to the Partnership such transfer would cause a termination of
the Partnership for Federal or state income tax purposes (except as a result of
the Redemption or exchange for REIT Shares, and a Redemption or exchange for
Preferred Shares or cash pursuant to Sections 18.5, 18.8, 19.5 and 19.8, of all
Partnership Units held by all Limited Partners or pursuant to a Termination
Transaction expressly permitted under Section 11.2); (v) if in the opinion of
counsel to the Partnership such transfer would cause the Partnership to cease to
be classified as a partnership for Federal or state income tax purposes (except
as a result of the Redemption or exchange for REIT Shares and a Redemption or
exchange for Preferred Shares pursuant to Sections 18.5, 18.8, 19.5 and 19.8 of
all Partnership Units held by all Limited Partners); (vi) if such transfer would
cause the Partnership to become, with respect to any employee benefit plan
subject to Title I of ERISA, a "party-in-interest" (as defined in Section 3(14)
of ERISA) or a "disqualified person" (as defined in Section 4975(c) of the
Code); (vii) if such transfer would, in the opinion of counsel to the
Partnership, cause any portion of the assets of the Partnership to constitute
assets of any employee benefit plan pursuant to Department of Labor Regulations
Section 2510.2-101; (viii) if such transfer requires the registration of such
Partnership Interest or requires the registration of the exchange of such
Partnership Interests for any capital stock pursuant to any applicable Federal
or state securities laws; (ix) except with the consent of the General Partner,
which may be given or withheld in its sole and absolute discretion, if such
transfer is effectuated through an "established securities market" or a
"secondary market" (or the substantial equivalent thereof) within the meaning of
Section 7704 of the Code or such transfer causes the Partnership to become a
"Publicly Traded Partnership," as such term is defined in Sections 469(k)(2) or
7704(b) of the Code; (x) if such transfer subjects the Partnership to be
regulated under the Investment Company Act of 1940, the Investment Advisors Act
of 1940 or the Employee Retirement Income Security Act of 1974, each as amended;
(xi) if the transferee or assignee of such Partnership Interest is unable to
make the representations set forth in Section 3.4.D or such transfer could
otherwise adversely affect the ability of the General Partner to remain
qualified as a REIT; or (xii) if in the opinion of legal counsel for the
Partnership such transfer would adversely affect the ability of the General
Partner to continue to qualify as a REIT or, except with the consent of the
General Partner, which may
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be given or withheld in its sole and absolute discretion, subject the General
Partner to any additional taxes under Section 857 or Section 4981 of the Code.
F. The General Partner shall monitor the transfers of
interests in the Partnership (including any acquisition of Common Units, Series
J Preferred Units or Series K Preferred Units by the Partnership or the General
Partner) to determine (i) if such interests are being traded on an "established
securities market" or a "secondary market (or the substantial equivalent
thereof)" within the meaning of Section 7704 of the Code and (ii) whether such
transfers of interests would result in the Partnership being unable to qualify
for at least one of the "safe harbors" set forth in Regulations Section 1.7704-1
(or such other applicable guidance subsequently published by the IRS setting
forth safe harbors under which interests will not be treated as "readily
tradable on a secondary market (or the substantial equivalent thereof)" within
the meaning of Section 7704 of the Code) (the "Safe Harbors"). The General
Partner shall have authority (but shall not be required to) to take any steps it
determines are necessary or appropriate in its sole and absolute discretion to
prevent any trading of interests which could cause the Partnership to become a
"publicly traded partnership," or any recognition by the Partnership of such
transfers, or to insure that at least one of the Safe Harbors is met.
ARTICLE 12.
ADMISSION OF PARTNERS
Section 12.1 Admission of Successor General Partner
A successor to all of the General Partner's General Partner
Interest pursuant to Section 11.2 who is proposed to be admitted as a successor
General Partner shall be admitted to the Partnership as the General Partner,
effective upon such transfer. Any such transferee shall carry on the business of
the Partnership without dissolution. In each case, the admission shall be
subject to the successor General Partner executing and delivering to the
Partnership an acceptance of all of the terms and conditions of this Agreement
and such other documents or instruments as may be required to effect the
admission. In the case of such admission on any day other than the first day of
a Partnership Year, all items attributable to the General Partner Interest for
such Partnership Year shall be allocated between the transferring General
Partner and such successor as provided in Article 11.
Section 12.2 Admission of Additional Limited Partners
A. A Person who makes a Capital Contribution to the
Partnership in accordance with this Agreement shall be admitted to the
Partnership as an Additional Limited Partner only upon furnishing to the General
Partner (i) evidence of acceptance in form satisfactory to the General Partner
of all of the terms and conditions of this Agreement, including, without
limitation, the power of attorney granted in Section 2.4 and (ii) such other
documents or instruments as may be required in the discretion of the General
Partner in order to effect such Person's admission as an Additional Limited
Partner.
B. Notwithstanding anything to the contrary in this
Section 12.2, no Person shall be admitted as an Additional Limited Partner
without the consent of the General Partner, which consent may be given or
withheld in the General Partner's sole and absolute discretion. The admission of
any Person as an Additional Limited Partner shall become effective on the date
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upon which the name of such Person is recorded on the books and records of the
Partnership, following the receipt of the Capital Contribution in respect of
such Limited Partner, the documents set forth in this Section 12.2.A and the
consent of the General Partner to such admission. If any Additional Limited
Partner is admitted to the Partnership on any day other than the first day of a
Partnership Year, then Net Income, Net Losses, each item thereof and all other
items allocable among Partners and Assignees for such Partnership Year shall be
allocated among such Limited Partner and all other Partners and Assignees by
taking into account their varying interests during the Partnership Year in
accordance with Section 706(d) of the Code, using the interim closing of the
books method. Solely for purposes of making such allocations, each of such items
for the calendar month in which an admission of an Additional Limited Partner
occurs shall be allocated among all the Partners and Assignees, including such
Additional Limited Partner, in a manner determined by the General Partner in its
sole discretion.
Section 12.3 Amendment of Agreement and Certificate of Limited
Partnership
For the admission to the Partnership of any Partner, the
General Partner shall take all steps necessary and appropriate under the Act to
amend the records of the Partnership and, if necessary, to prepare as soon as
practical an amendment of this Agreement (including an amendment of Exhibit A)
and, if required by law, shall prepare and file an amendment to the Certificate
and may for this purpose exercise the power of attorney granted pursuant to
Section 2.4.
ARTICLE 13.
DISSOLUTION AND LIQUIDATION
Section 13.1 Dissolution
The Partnership shall not be dissolved by the admission of
Substituted Limited Partners or Additional Limited Partners or by the admission
of a successor General Partner in accordance with the terms of this Agreement.
Upon the withdrawal of the General Partner, any successor General Partner
(selected as described in Section 13.1.B below) shall continue the business of
the Partnership. The Partnership shall dissolve, and its affairs shall be wound
up, upon the first to occur of any of the following ("Liquidating Events"):
A. the expiration of its term as provided in Section
2.5;
B. an event of withdrawal of the General Partner, as
defined in the Act, unless, within ninety (90) days after the withdrawal, all of
the remaining Partners agree in writing, in their sole and absolute discretion,
to continue the business of the Partnership and to the appointment, effective as
of the date of withdrawal, of a substitute General Partner;
C. prior to December 31, 2096, an election to dissolve
the Partnership made by the General Partner with the consent of Limited Partners
who hold ninety percent (90%) of the outstanding Units held by Limited Partners;
D. subject to the provisions of Section 7.3.C, an
election to dissolve the Partnership made by the General Partner in its sole and
absolute discretion;
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E. entry of a decree of judicial dissolution of the
Partnership pursuant to the provisions of the Act;
F. the sale or disposition of all or substantially all
of the assets and properties of the Partnership;
G. final and non-appealable judgment is entered by a
court of competent jurisdiction ruling that the General Partner is bankrupt or
insolvent, or a final and non-appealable order for relief is entered by a court
with appropriate jurisdiction against the General Partner, in each case under
any Federal or state bankruptcy or insolvency laws as now or hereafter in
effect, unless prior to or at the time of the entry of such order or judgment a
Majority in Interest of the remaining Limited Partners Consent in writing to
continue the business of the Partnership and to the appointment, effective as of
a date prior to the date of such order or judgment, of a substitute General
Partner; or
H. the Redemption or exchange for REIT Shares, Series J
Preferred Shares or Series K Preferred Shares of all Partnership Units (other
than those of the General Partner) pursuant to this Agreement.
Section 13.2 Winding Up
A. Upon the occurrence of a Liquidating Event, the
Partnership shall continue solely for the purposes of winding up its affairs in
an orderly manner, liquidating its assets, and satisfying the claims of its
creditors and Partners. No Partner shall take any action that is inconsistent
with, or not necessary to or appropriate for, the winding up of the
Partnership's business and affairs. The General Partner (or, in the event there
is no remaining General Partner, any Person elected by a Majority in Interest of
the Limited Partners (the "Liquidator")) shall be responsible for overseeing the
winding up and dissolution of the Partnership and shall take full account of the
Partnership's liabilities and assets and the Partnership property shall be
liquidated as promptly as is consistent with obtaining the fair value thereof,
and the proceeds therefrom (which may, to the extent determined by the General
Partner, include shares of stock of the General Partner) shall be applied and
distributed in the following order:
(i) First, to the payment and discharge of all of the
Partnership's debts and liabilities to creditors
other than the Partners;
(ii) Second, to the payment and discharge of all of the
Partnership's debts and liabilities to the General
Partner;
(iii) Third, to the payment and discharge of all of the
Partnership's debts and liabilities to the other
Partners; and
(iv) The balance, if any, to the Partners in accordance
with their Capital Account balances determined after
giving effect to all contributions and distributions
for all periods, and after taking into account all
Capital Account adjustments for the Partnership
taxable year during which the liquidation occurs
(other than those made as a result of the liquidating
distribution set forth in this Section 13.2.A(iv)).
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The General Partner shall not receive any additional compensation for any
services performed pursuant to this Article 13 other than reimbursement of its
expenses as provided in Section 7.4.
B. Notwithstanding the provisions of Section 13.2.A
which require liquidation of the assets of the Partnership, but subject to the
order of priorities set forth therein, if prior to or upon dissolution of the
Partnership the Liquidator determines that an immediate sale of part or all of
the Partnership's assets would be impractical or would cause undue loss to the
Partners, the Liquidator may, in its sole and absolute discretion, defer for a
reasonable time the liquidation of any assets except those necessary to satisfy
liabilities of the Partnership (including to those Partners as creditors) and/or
distribute to the Partners, in lieu of cash, as tenants in common and in
accordance with the provisions of Section 13.2.A, undivided interests in such
Partnership assets as the Liquidator deems not suitable for liquidation. Any
such distributions in kind shall be made only if, in the good faith judgment of
the Liquidator, such distributions in kind are in the best interest of the
Partners, and shall be subject to such conditions relating to the disposition
and management of such properties as the Liquidator deems reasonable and
equitable and to any agreements governing the operation of such properties at
such time. The Liquidator shall determine the fair market value of any property
distributed in kind using such reasonable method of valuation as it may adopt.
C. The Partnership shall be terminated when any notes
received in connection with any such sale or disposition referenced in Section
13.1.E above, or in connection with the liquidation of the Partnership have been
paid and all of the cash or property available for application and distribution
under this Agreement have been applied and distributed in accordance with this
Agreement.
Section 13.3 Compliance with Timing Requirements of
Regulations
In the event the Partnership is "liquidated" within the
meaning of Regulations Section 1.704-1(b)(2)(ii)(g), distributions shall be made
pursuant to this Article 13 to the General Partner and Limited Partners who have
positive Capital Accounts in compliance with Regulations Section
1.704-1(b)(2)(ii)(b)(2). If any Partner has a deficit balance in his or her
Capital Account (after giving effect to all contributions, distributions and
allocations for the taxable years, including the year during which such
liquidation occurs), such Partner shall have no obligation to make any
contribution to the capital of the Partnership with respect to such deficit, and
such deficit shall not be considered a debt owed to the Partnership or to any
other Person for any purpose whatsoever, except to the extent otherwise agreed
to by such Partner and the General Partner. In the discretion of the Liquidator
or the General Partner, a pro rata portion of the distributions that would
otherwise be made to the General Partner and Limited Partners pursuant to this
Article 13 may be:
A. distributed to a trust established for the benefit of
the General Partner and Limited Partners for the purposes of liquidating
Partnership assets, collecting amounts owed to the Partnership, and paying any
contingent or unforeseen liabilities or obligations of the Partnership or of the
General Partner arising out of or in connection with the Partnership. The assets
of any such trust shall be distributed to the General Partner and Limited
Partners from time to time, in the reasonable discretion of the Liquidator or
the General Partner, in the same proportions and the amount distributed to such
trust by the Partnership would otherwise have been distributed to the General
Partner and Limited Partners pursuant to this Agreement; or
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B. withheld to establish any reserves deemed necessary
or appropriate for any contingent or unforeseen liabilities or obligations of
the Partnership; and to reflect the unrealized portion of any installment
obligations owed to the Partnership; provided that, such withheld amounts shall
be distributed to the General Partner and Limited Partners as soon as
practicable.
Section 13.4 Deemed Distribution and Recontribution
Notwithstanding any other provision of this Article 13, in the
event the Partnership is liquidated within the meaning of Regulations Section
1.704-1(b)(2)(ii)(g) but no Liquidating Event has occurred, the Partnership's
property shall not be liquidated, the Partnership's liabilities shall not be
paid or discharged, and the Partnership's affairs shall not be wound up.
Instead, the Partnership shall be deemed to have distributed the Partnership
property in kind to the General Partner and Limited Partners, who shall be
deemed to have assumed and taken such property subject to all Partnership
liabilities, all in accordance with their respective Capital Accounts.
Immediately thereafter, the General Partner and Limited Partners shall be deemed
to have recontributed the Partnership property in kind to the Partnership, which
shall be deemed to have assumed and taken such property subject to all such
liabilities.
Section 13.5 Rights of Limited Partners
Except as otherwise provided in this Agreement, each Limited
Partner shall look solely to the assets of the Partnership for the return of his
Capital Contribution and shall have no right or power to demand or receive
property from the General Partner. Except as expressly set forth herein with
respect to the rights, priorities and preferences of the Preferred Limited
Partners holding any series of Preferred Units, no Limited Partner shall have
priority over any other Limited Partner as to the return of his Capital
Contributions, distributions or allocations.
Section 13.6 Notice of Dissolution
In the event a Liquidating Event occurs or an event occurs
that would, but for provisions of Section 13.1, result in a dissolution of the
Partnership, the General Partner shall, within thirty (30) days thereafter,
provide written notice thereof to each of the Partners and to all other parties
with whom the Partnership regularly conducts business (as determined in the
discretion of the General Partner) and shall publish notice thereof in a
newspaper of general circulation in each place in which the Partnership
regularly conducts business (as determined in the discretion of the General
Partner).
Section 13.7 Cancellation of Certificate of Limited
Partnership
Upon the completion of the liquidation of the Partnership cash
and property as provided in Section 13.2, the Partnership shall be terminated
and the Certificate and all qualifications of the Partnership as a foreign
limited partnership in jurisdictions other than the State of Delaware shall be
canceled and such other actions as may be necessary to terminate the Partnership
shall be taken.
Section 13.8 Reasonable Time for Winding-Up
A reasonable time shall be allowed for the orderly winding-up
of the business and affairs of the Partnership and the liquidation of its assets
pursuant to Section 13.2, in order to
68
minimize any losses otherwise attendant upon such winding-up, and the provisions
of this Agreement shall remain in effect between the Partners during the period
of liquidation.
Section 13.9 Waiver of Partition
Each Partner hereby waives any right to partition of the
Partnership property.
ARTICLE 14.
AMENDMENT OF PARTNERSHIP AGREEMENT; CONSENTS
Section 14.1 Amendments
A. The actions requiring consent or approval of the
Partners or of the Limited Partners pursuant to this Agreement, including
Section 7.3, or otherwise pursuant to applicable law, are subject to the
procedures in this Article 14.
B. Amendments to this Agreement requiring the consent or
approval of Limited Partners may be proposed by the General Partner or by
Limited Partners holding twenty-five percent (25%) or more of the Partnership
Interests held by Limited Partners. Following such proposal, the General Partner
shall submit any proposed amendment to the Partners or of the Limited Partners,
as applicable. The General Partner shall seek the written consent or approval of
the Partners or of the Limited Partners on the proposed amendment or shall call
a meeting to vote thereon and to transact any other business that it may deem
appropriate. For purposes of obtaining a written consent, the General Partner
may require a response within a reasonable specified time, but not less than
fifteen (15) days, and failure to respond in such time period shall constitute a
consent which is consistent with the General Partner's recommendation (if so
recommended); provided that, an action shall become effective at such time as
requisite consents are received even if prior to such specified time.
Section 14.2 Action by the Partners
A. Meetings of the Partners may be called by the General
Partner and shall be called upon the receipt by the General Partner of a written
request by Limited Partners holding twenty-five percent (25%) or more of the
Partnership Interests held by the Limited Partners. The call shall state the
nature of the business to be transacted. Notice of any such meeting shall be
given to all Partners not less than seven days nor more than thirty (30) days
prior to the date of such meeting. Partners may vote in person or by proxy at
such meeting. Whenever the vote of the Percentage Interests of the Partners, or
the Consent of the Partners or Consent of the Limited Partners is permitted or
required under this Agreement, such vote or Consent may be given at a meeting of
Partners or may be given in accordance with the procedure prescribed in Section
14.1.
B. Any action required or permitted to be taken at a
meeting of the Partners may be taken without a meeting if a written consent
setting forth the action so taken is signed by the Percentage Interests as is
expressly required by this Agreement for the action in question. Such consent
may be in one instrument or in several instruments, and shall have the same
force and effect as a vote of the Percentage Interests of the Partners
(expressly required by this Agreement). Such consent shall be filed with the
General Partner. An action so taken shall be deemed to have been taken at a
meeting held on the effective date so certified.
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C. Each Limited Partner may authorize any Person or
Persons to act for him by proxy on all matters in which a Limited Partner is
entitled to participate, including waiving notice of any meeting, or voting or
participating at a meeting. Every proxy must be signed by the Limited Partner or
his attorney-in-fact. No proxy shall be valid after the expiration of eleven
(11) months from the date thereof unless otherwise provided in the proxy. Every
proxy shall be revocable at the pleasure of the Limited Partner executing it.
D. Each meeting of Partners shall be conducted by the
General Partner or such other Person as the General Partner may appoint pursuant
to such rules for the conduct of the meeting as the General Partner or such
other Person deems appropriate.
E. On matters on which Limited Partners are entitled to
vote, each Limited Partner shall have a vote equal to the number of Partnership
Units held.
ARTICLE 15.
GENERAL PROVISIONS
Section 15.1 Addresses and Notice
Any notice, demand, request or report required or permitted to
be given or made to a Partner or Assignee under this Agreement shall be in
writing and shall be deemed given or made when delivered in person or when sent
by certified first class United States mail, nationally recognized overnight
delivery service or facsimile transmission to the Partner or Assignee at the
address set forth in Exhibit A or such other address as the Partners shall
notify the General Partner in writing.
Section 15.2 Titles and Captions
All article or section titles or captions in this Agreement
are for convenience only. They shall not be deemed part of this Agreement and in
no way define, limit, extend or describe the scope or intent of any provisions
hereof. Except as specifically provided otherwise, references to "Articles" and
"Sections" are to Articles and Sections of this Agreement.
Section 15.3 Pronouns and Plurals
Whenever the context may require, any pronoun used in this
Agreement shall include the corresponding masculine, feminine or neuter forms,
and the singular form of nouns, pronouns and verbs shall include the plural and
vice versa.
Section 15.4 Further Action
The parties shall execute and deliver all documents, provide
all information and take or refrain from taking action as may be necessary or
appropriate to achieve the purposes of this Agreement.
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Section 15.5 Binding Effect
This Agreement shall be binding upon and inure to the benefit
of the parties hereto including the Persons set forth in Exhibit G, and their
heirs, executors, administrators, successors, legal representatives and
permitted assigns.
Section 15.6 Creditors
Other than as expressly set forth herein with respect to
Indemnitees, none of the provisions of this Agreement shall be for the benefit
of, or shall be enforceable by, any creditor of the Partnership.
Section 15.7 Waiver
No failure or delay by any party to insist upon the strict
performance of any covenant, duty, agreement or condition of this Agreement or
to exercise any right or remedy consequent upon any breach thereof shall
constitute waiver of any such breach or any other covenant, duty, agreement or
condition.
Section 15.8 Counterparts
This Agreement may be executed in counterparts, all of which
together shall constitute one agreement binding on all the parties hereto,
notwithstanding that all such parties are not signatories to the original or the
same counterpart. Each party shall become bound by this Agreement immediately
upon affixing its signature hereto.
Section 15.9 Applicable Law
This Agreement shall be construed in accordance with and
governed by the laws of the State of Delaware, without regard to the principles
of conflicts of law.
Section 15.10 Invalidity of Provisions
If any provision of this Agreement is or becomes invalid,
illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not be
affected thereby.
Section 15.11 Limitation to Preserve REIT Status
To the extent that any amount paid or credited to the General
Partner or its officers, directors, employees or agents pursuant to Section 7.4
or 7.7 would constitute gross income to the General Partner for purposes of
Sections 856(c)(2) or 856(c)(3) of the Code (a "General Partner Payment") then,
notwithstanding any other provision of this Agreement, the amount of such
General Partner Payments for any fiscal year shall not exceed the lesser of:
(i) an amount equal to the excess, if any, of (a) 4.17% of
the General Partner's total gross income (but not
including the amount of any General Partner Payments)
for the fiscal year which is described in subsections
(A) through (H) of Section 856(c)(2) of the Code over
(b) the amount of gross
71
income (within the meaning of Section 856(c)(2) of the
Code) derived by the General Partner from sources other
than those described in subsections (A) through (H) of
Section 856(c)(2) of the Code (but not including the
amount of any General Partner Payments); or
(ii) an amount equal to the excess, if any, of (a) 25% of
the General Partner's total gross income (but not
including the amount of any General Partner Payments)
for the fiscal year which is described in subsections
(A) through (I) of Section 856(c)(3) of the Code over
(b) the amount of gross income (within the meaning of
Section 856(c)(3) of the Code) derived by the General
Partner from sources other than those described in
subsections (A) through (I) of Section 856(c)(3) of the
Code (but not including the amount of any General
Partner Payments);
provided, however, that General Partner Payments in excess of the amounts set
forth in subparagraphs (i) and (ii) above may be made if the General Partner, as
a condition precedent, obtains an opinion of tax counsel that the receipt of
such excess amounts would not adversely affect the General Partner's ability to
qualify as a REIT. To the extent General Partner Payments may not be made in a
year due to the foregoing limitations, such General Partner Payments shall carry
over and be treated as arising in the following year; provided, however, that
such amounts shall not carry over for more than five years, and if not paid
within such five year period, shall expire; provided, further, that (a) as
General Partner Payments are made, such payments shall be applied first to carry
over amounts outstanding, if any and (b) with respect to carry over amounts for
more than one Partnership Year, such payments shall be applied to the earliest
Partnership Year first.
Section 15.12 Entire Agreement
This Agreement (together with the agreements listed on Exhibit
I hereto as to rights and obligations in respect of the Units held by the
Limited Partners who are parties thereto, or their permitted transferees)
contains the entire understanding and agreement among the Partners with respect
to the subject matter hereof and supersedes any other prior written or oral
understandings or agreements among them with respect thereto.
Section 15.13 No Rights as Stockholders
Nothing contained in this Agreement shall be construed as
conferring upon the holders of Partnership Units any rights whatsoever as
stockholders of the General Partner, including without limitation any right to
receive dividends or other distributions made to stockholders of the General
Partner or to vote or to consent or to receive notice as stockholders in respect
of any meeting of stockholders for the election of directors of the General
Partner or any other matter.
ARTICLE 16.
INTENTIONALLY OMITTED
ARTICLE 17.
INTENTIONALLY OMITTED
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ARTICLE 18.
SERIES J PREFERRED UNITS
Section 18.1 Designation and Number
A series of Partnership Units in the Partnership designated as
the 7.95% Series J Cumulative Redeemable Preferred Units (the "Series J
Preferred Units") is hereby established. The number of Series J Preferred Units
shall be 800,000.
Section 18.2 Ranking
The Series J Preferred Units shall, with respect to
distribution rights and rights upon voluntary or involuntary liquidation,
winding up or dissolution of the Partnership, rank (i) senior to the Common
Units and to all Partnership Units the terms of which provide that such
Partnership Units shall rank junior to the Series J Preferred Units; (ii) on a
parity with the Series K Preferred Units, the Series L Preferred Units, the
Series M Preferred Units and all other Parity Preferred Units; and (iii) junior
to all Partnership Units which rank senior to the Series J Preferred Units.
Section 18.3 Distributions
A. Payment of Distributions. Subject to the rights of
holders of Parity Preferred Units (including the Series K Preferred Units, the
Series L Preferred Units and the Series M Preferred Units) as to the payment of
distributions, pursuant to Section 5.1, Section 19.3.A, Section 20.3.A and
Section 21.3.A hereof, holders of Series J Preferred Units will be entitled to
receive, when, as and if declared by the Partnership acting through the General
Partner, out of Available Cash, cumulative preferential cash distributions in an
amount equal to the Series J Priority Return. Such distributions will be payable
(A) quarterly in arrears, on the 15th day of January, April, July and October of
each year and (B) in the event of (i) an exchange of Series J Preferred Units
into Series J Preferred Shares, or (ii) a redemption of Series J Preferred
Units, on the exchange date or redemption date, as applicable (each a "Series J
Preferred Unit Distribution Payment Date"), commencing on the first of such
payment dates to occur following their original date of issuance. If any date on
which distributions are to be made on the Series J Preferred Units is not a
Business Day, then payment of the distribution to be made 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
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 J Preferred Units will be
made to the holders of record of the Series J Preferred Units on the relevant
record dates, which will be fifteen (15) days prior to the relevant Preferred
Unit Distribution Payment Date (the "Series J Preferred Unit Partnership Record
Date").
B. Distributions Cumulative. Notwithstanding the
foregoing, distributions on the Series J Preferred Units will accrue whether or
not the terms and provisions of any agreement of the Partnership at any time
prohibit the current payment of distributions, whether or not the Partnership
has earnings, whether or not there are funds legally available for the payment
of such distributions and whether or not such distributions are authorized.
Accrued but unpaid
73
distributions on the Series J Preferred Units will accumulate as of the
Preferred Unit Distribution Payment Date on which they first become payable.
C. Priority as to Distributors.
(i) So long as any Series J 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 Interest represented by Junior Units, nor shall any Junior
Units or Parity Preferred Units (including the Series K Preferred Units, the
Series L Preferred Units and the Series M Preferred Units) be redeemed,
purchased or otherwise acquired for any consideration (or any monies be paid to
or made available for a sinking fund for the redemption of any such Junior Units
or Parity Preferred Units) by the Partnership (except by conversion into or
exchange for other Junior Units or Parity Preferred Units) unless, in each case,
full cumulative distributions have been or contemporaneously are authorized and
paid or authorized and a sum sufficient for the payment thereof set apart for
such payment on the Series J Preferred Units and all classes and series of
outstanding Parity Preferred Units for all distribution periods. The foregoing
sentence will not prohibit (a) distributions payable solely in Junior Units, (b)
the exchange of Junior Units or Parity Preferred Units (including the Series K
Preferred Units, the Series L Preferred Units and the Series M Preferred Units)
into Partnership Interests of the Partnership ranking junior to the Series J
Preferred Units as to distributions, or (c) the redemption of Partnership
Interests corresponding to Series J Preferred Shares, Parity Preferred Stock
(including Series K Preferred Shares, Series L Preferred Shares and Series M
Preferred Shares) with respect to distributions or Junior Stock to be purchased
by the General Partner pursuant to the Charter to preserve the General Partner's
status as a real estate investment trust, provided that such redemption shall be
upon the same terms as the corresponding stock purchase pursuant to the Charter.
(ii) So long as distributions have not been paid in full
(or a sum sufficient for such full payment is not so set apart) upon the Series
J Preferred Units and any other Parity Preferred Units (including the Series K
Preferred Units, the Series L Preferred Units and the Series M Preferred Units),
all distributions authorized and declared on the Series J Preferred Units and
all classes or series of outstanding Parity Preferred Units (including the
Series K Preferred Units, the Series L Preferred Units and the Series M
Preferred Units) shall be authorized and declared pro rata so that the amount of
distributions authorized and declared per Series J 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 J 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 do not have cumulative
distribution rights) bear to each other. No interest, or sum of money in lieu of
interest, shall be payable in respect of any distributions or payments on Series
J Preferred Units which may be in arrears.
(iii) Notwithstanding anything to the contrary set forth
herein, distributions on Partnership Interests held by either (a) the General
Partner or (b) any other holder of Partnership Interest in the Partnership, in
each case ranking junior to or on parity with the Series J Preferred Units may
be made, without preserving the priority of distributions described in Sections
18.3.C(i) and (ii), but (i) only to the extent such distributions are required
to preserve the real
74
estate investment trust status of the General Partner and (ii) in the case of
any holder other than the General Partner only to the extent required by the
Partnership Agreement.
D. No Further Rights. Holders of Series J Preferred
Units shall not be entitled to any distributions, whether payable in cash, other
property or otherwise, in excess of the full cumulative distributions described
herein.
Section 18.4 Liquidation Proceeds
A. Distributions. Upon voluntary or involuntary
liquidation, dissolution or winding-up of the Partnership, distributions on the
Series J Preferred Units shall be made in accordance with Article 13 of this
Agreement.
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 the
General Partner pursuant to Section 13.6 hereof.
C. No Further Rights. After payment of the full amount
of the liquidating distributions to which they are entitled, Holders of Series J
Preferred Units will have no right or claim to any of the remaining assets of
the Partnership.
D. Consolidation, Merger or Certain Other Transactions.
None of a consolidation or merger of the Partnership with or into another
entity, a merger of another entity with or into the Partnership, or a sale,
lease, transfer or conveyance of all or substantially all of the Partnership's
property or business shall be considered a liquidation, dissolution or winding
up of the Partnership.
Section 18.5 Redemption
A. Redemption. The Series J Preferred Units may not be
redeemed prior to September 21, 2006. On or after such date, the Partnership
shall have the right to redeem the Series J 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 J Preferred Units (the
"Redemption Price"); provided, however, that no redemption pursuant to this
Section 18.5 will be permitted if the Redemption Price does not equal or exceed
the original Capital Contribution of such holder plus the cumulative Priority
Return to the redemption date to the extent not previously distributed. If fewer
than all of the outstanding Series J Preferred Units are to be redeemed, the
Series J Preferred Units to be redeemed shall be selected pro rata (as nearly as
practicable without creating fractional units).
B. Limitation on Redemption. (i) The Redemption Price of
the Series J Preferred Units (other than the portion thereof consisting of
accumulated but unpaid distributions) is payable solely out of the sale proceeds
of capital stock of the General Partner, which will be contributed by the
General Partner to the Partnership as an additional capital contribution, or out
of the sale of limited partner interests in the Partnership and from no other
source. For purposes of the preceding sentence, "capital stock" means any equity
securities (including Common Stock and Preferred Stock (as such terms are
defined in the Charter)),
75
depository shares, interests, participation or other ownership interests
(however designated) and any rights (other than debt securities convertible into
or exchangeable for equity securities) or options to purchase any of the
foregoing.
(ii) The Partnership may not redeem fewer than all of the
outstanding Series J Preferred Units unless all accumulated and unpaid
distributions have been paid on all Series J Preferred Units for all quarterly
distribution periods terminating on or prior to the date of redemption.
C. Procedures for Redemption. (i) Notice of redemption
will be (i) faxed, and (ii) 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 respective holders of record of the Series J Preferred
Units 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 J 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: (a)
the redemption date, (b) the Redemption Price, (c) the aggregate number of
Series J Preferred Units to be redeemed and if fewer than all of the outstanding
Series J Preferred Units are to be redeemed, the number of Series J 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 aggregate number of outstanding
Series J Preferred Units that the total number of Series J Preferred Units held
by such holder represents) of the aggregate number of Series J Preferred Units
to be redeemed, (d) the place or places where such Series J Preferred Units are
to be surrendered for payment of the Redemption Price, (e) that distributions on
the Series J Preferred Units to be redeemed will cease to accumulate on such
redemption date and (f) that payment of the Redemption Price will be made upon
presentation and surrender of such Series J Preferred Units.
(ii) If the Partnership gives a notice of redemption in
respect of Series J Preferred Units (which notice will be irrevocable) then, by
12:00 noon, New York City time, on the redemption date, the Partnership will
deposit irrevocably in trust for the benefit of the Series J Preferred Units
being redeemed funds sufficient to pay the applicable Redemption Price and will
give irrevocable instructions and authority to pay such Redemption Price to the
holders of the Series J Preferred Units upon surrender of the Series J Preferred
Units by such holders at the place designated in the notice of redemption. On
and after the date of redemption, distributions will cease to accumulate on the
Series J Preferred Units or portions thereof called for redemption, unless the
Partnership defaults in the payment thereof. If any date fixed for redemption of
Series J 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 and not paid
by the Partnership, distributions on such Series J 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.
76
Section 18.6 Voting Rights
A. General. Holders of the Series J Preferred Units will
not have any voting rights or right to consent to any matter requiring the
consent or approval of the Limited Partners, except as set forth below and in
Section 7.3.E.
B. Certain Voting Rights. So long as any Series J
Preferred Units remain outstanding, the Partnership shall not, without the
affirmative vote of the holders of at least two-thirds of the Series J 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 prior to the Series J Preferred Units with respect to payment of
distributions or rights upon liquidation, dissolution or winding-up or
reclassify any Partnership Interests of the Partnership into any such
Partnership Interest, or create, authorize or issue any obligations or security
convertible into or evidencing the right to purchase any such Partnership
Interests, (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 Partnership Interest or create, authorize or issue any
obligations or security convertible into or evidencing the right to purchase any
such Partnership Interests but only to the extent such Parity Preferred Units
are issued to an affiliate of the Partnership, 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 who are not affiliates of the
Partnership or (iii) either consolidate, merge into or with, or convey, transfer
or lease its assets substantially as an entirety to, any corporation or other
entity or amend, alter or repeal the provisions of the Partnership Agreement
(including, without limitation, this Article 18), whether by merger,
consolidation or otherwise, in each case in a manner that would materially and
adversely affect the powers, special rights, preferences, privileges or voting
power of the Series J Preferred Units or the holders thereof; provided, however,
that with respect to the occurrence of any event set forth in (iii) above, so
long as (a) the Partnership is the surviving entity and the Series J Preferred
Units remain outstanding with the terms thereof unchanged, or (b) the resulting,
surviving or transferee entity (I) is a partnership, limited liability company
or other pass-through entity organized under the laws of any state, (II) is not
taxable as a corporation for U.S. federal income tax purposes and (III)
substitutes the Series J Preferred Units for other interests in such entity
having substantially the same terms and rights as the Series J Preferred Units,
including with respect to distributions, voting rights and rights upon
liquidation, dissolution or winding-up, then the occurrence of any such event
shall not be deemed to materially and adversely affect such rights, privileges
or voting powers of the holders of the Series J Preferred Units; and provided
further, that any increase in the amount of Partnership Interests or the
creation or issuance of any other class or series of Partnership Interests
represented by Junior Units or Parity Preferred Units are not issued to an
affiliate of the Partnership, 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 who are not affiliates of the
Partnership, shall not be deemed to materially and adversely affect such rights,
preferences, privileges or voting powers.
Section 18.7 Transfer Restrictions
The Series J Preferred Units shall be subject to the
provisions of Article 11 hereof; provided, however, that the Series J Preferred
Units shall not be subject to the right of first refusal of the General Partner
as described in Section 11.3 hereof. No transfer of Series J
77
Preferred Units, or other action by the holder or holders of such Units, is
permitted, without the consent of the General Partner which consent may be given
or withheld in its sole and absolute discretion, if such transfer or other
action would result in more than two partners holding all outstanding Series J
Preferred Units within the meaning of Treasury Regulation Section
1.7704-1(h)(1)(ii) (without regard to Treasury Regulation Section
1.7704-1(h)(3)(ii)); provided, however, that the General Partner's consent may
not be unreasonably withheld if (a) such transfer or other action would not
result in more than five partners holding all outstanding Series J Preferred
Units within the meaning of Treasury Regulation Section 1.7704-1(h)(1)(ii)
(without regard to Treasury Regulation Section 1.7704-1(h)(3)(ii)) and (b) the
General Partner cannot rely on Treasury Regulation Section 1.7704-1(h) to avoid
classification of Operating Partnership as a PTP. In addition, no transfer may
be made to any person if such transfer would cause the exchange of the Series J
Preferred Units for Series J Preferred Shares, as provided herein, to be
required to be registered under the Securities Act of 1933, as amended, or any
state securities laws. If (i) the holders of 51% of the Series J Preferred Units
conclude based on results or projected results that there exists (in the
reasonable judgment of such holders) an imminent and substantial risk that such
holder's interest in the Partnership represents or will represent more than
19.5% of the total profits or capital interests in the Partnership for a taxable
year (the "19.5% Limit"), (ii) such holders deliver to the General Partner an
opinion of independent counsel to the effect that there is a substantial risk
that such holder's interest in the Partnership represents or will represent more
than the 19.5% Limit (determined in accordance with Regulations Section
1.731-2(e)(4)), and (iii) the General Partner agrees with the conclusions
referred to in clauses (i) and (ii) of this sentence, such agreement not to be
unreasonably withheld, then such holders shall, subject to the above
limitations, be permitted to transfer so much of their Series J Preferred Units
as may be appropriate to alleviate the risk of not satisfying the 19.5% Limit to
the trust described in Exhibit J, with such holders having the rights set forth
in such Exhibit.
Section 18.8 Exchange Rights
A. Right to Exchange. (i) Series J Preferred Units will
be exchangeable in whole but not in part unless expressly otherwise provided
herein at anytime on or after September 21, 2011, at the option of the holders
of 51% of all outstanding Series J Preferred Units, for authorized but
previously unissued Series J Preferred Shares at an exchange rate of one Series
J Preferred Share from the General Partner for one Series J Preferred Unit,
subject to adjustment as described below (the "Exchange Price"), provided that
the Series J Preferred Units will become exchangeable at any time, in whole but
not in part unless expressly otherwise provided herein, at the option of the
holders of 51% of all outstanding Series J Preferred Units for Series J
Preferred Shares (x) if at any time full distributions shall not have been
timely made on any Series J Preferred Unit with respect to six (6) prior
quarterly distribution periods, whether or not consecutive, provided, however,
that a distribution in respect of Series J Preferred Units shall be considered
timely made if made within two (2) Business Days after the applicable Preferred
Unit Distribution Payment Date if at the time of such late payment there shall
not be any prior quarterly distribution periods in respect of which full
distributions were not timely made, or (y) at any time (A) the holders of 51% of
the Series J Preferred Units conclude (in the reasonable judgment of such
holders) that the Partnership, if it otherwise were taxable as a real estate
investment trust, either (1) will not or likely will not satisfy the income
tests of Section 856 of the Code for the year in which such determination is
made or (2) will not or likely will not satisfy the asset tests of Section 856
of the Code as of the end of the calendar quarter in which
78
such determination is made, which failure will not or is unlikely to be (or is
subsequently not) cured as permitted under Section 856 of the Code, (B) the
holders deliver to the General Partner an opinion of a nationally recognized
independent counsel to the effect of the conclusion set forth in clause (A) of
this sentence, (C) such failure would create a meaningful risk that a holder of
the Series J Preferred Units would fail to maintain its qualification as a real
estate investment trust and (D) the General Partner agrees with the conclusions
referred to in clauses (A) and (B) of this sentence, such agreement not to be
unreasonably withheld. Furthermore, the Series J Preferred Units, if the holders
of 51% of all outstanding Series J Preferred Units so determine, may be
exchanged in whole but not in part (regardless of whether held by one or more
holders) for Series J Preferred Shares if (1) the holders of 51% of all
outstanding Series J Preferred Units conclude based on results or projected
results that there exists (in the reasonable judgment of such holder) an
imminent and substantial risk that the holder's interest in the Partnership
represents or will represent more than the 19.5% Limit, (2) such holders deliver
to the General Partner an opinion of independent counsel to the effect that
there is a substantial risk that its interest in the Partnership does not or
will not satisfy the 19.5% Limit and (3) the General Partner agrees with the
conclusions referred to in clauses (1) and (2) of this sentence, such agreement
not to be unreasonably withheld; provided, however, that if, as a result of such
conclusion, such holders' interest in the Partnership is reduced pursuant to the
last sentence of Section 18.7 hereof (which procedure shall be available to such
holders to the exclusion of the procedure under this sentence for so long as, on
a cumulative basis, sales of 10% or fewer of the Series J Preferred Units
originally issued by the Partnership would in the opinion of the
above-referenced counsel reduce the risk that such holders' interest in the
Partnership would not satisfy the 19.5% Limit to less than a substantial risk,
and thereafter shall be a permitted alternative to the procedure pursuant to
this sentence) or the risk of such holder not satisfying the 19.5% Limit
otherwise is reduced below a substantial risk, then an exchange in whole under
this sentence shall not be permitted unless and until a change in facts occurs
and a further determination by such holders is made under this sentence.
(ii) Notwithstanding anything to the contrary set forth in
Section 18.8.A(i), if an Exchange Notice (as defined herein) has been delivered
to the General Partner, then the General Partner may, at its option, within ten
(10) Business Days after receipt of the Exchange Notice, elect to cause the
Partnership to redeem all or a portion of the outstanding Series J Preferred
Units for cash in an amount equal to the original Capital Contribution per
Series J Preferred Unit and all accrued and unpaid distributions thereon to the
date of redemption. If the General Partner elects to redeem fewer than all of
the outstanding Series J Preferred Units, the number of Series J Preferred Units
held by each holder to be redeemed shall equal such holder's pro rata share
(based on the percentage of the aggregate number of outstanding Series J
Preferred Units that the total number of Series J Preferred Units held by such
holder represents) of the aggregate number of Series J Preferred Units being
redeemed.
(iii) In the event an exchange of all Series J Preferred
Units pursuant to Section 18.8.A would violate the provisions on ownership
limitation of the General Partner set forth in Section 7 of the Third Article of
the Articles Supplementary to the Charter with respect to Series J Preferred
Shares (the "Series J Articles Supplementary"), each holder of Series J
Preferred Units shall be entitled to exchange, pursuant to the provisions of
Section 18.8.B, a number of Series J Preferred Units which would comply with the
provisions on the ownership limitation of the General Partner set forth in such
Section 7 of the Series J Articles Supplementary, with respect to such holder,
and any Series J Preferred Units not so exchanged (the "Excess Units")
79
shall be redeemed by the Partnership for cash in an amount equal to the original
Capital Contribution per Excess Unit, plus any accrued and unpaid distributions
thereon to the date of redemption subject to any restriction thereon contained
in any debt instrument or agreement of the Partnership. In the event an exchange
would result in Excess Units, as a condition to such exchange, each holder of
such 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 9.0% of the
stock of the General Partner; and (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. For
purposes of determining the number of Excess Units under this Section
18.8.A(iii), the "Beneficial Ownership Limit" and "Constructive Ownership Limit"
set forth in the Series J Articles Supplementary shall be deemed to be 9.0%. To
the extent the General Partner would not be able to pay the cash set forth above
in exchange for the Excess Units, and to the extent consistent with the Charter,
the General Partner agrees that it will grant to the holders of the Series J
Preferred Units exceptions to the Beneficial Ownership Limit and Constructive
Ownership Limit set forth in the Series J Articles Supplementary sufficient to
allow such holders to exchange all of their Series J Preferred Units for Series
J Preferred Stock, provided such holders furnish to the General Partner
representations acceptable to the General Partner in its sole and absolute
discretion which assure the General Partner that such exceptions will not
jeopardize the General Partner's tax status as a REIT for purposes of federal
and applicable state law. Notwithstanding any provision of this Agreement to the
contrary, no Series J Limited Partner shall be entitled to effect an exchange of
Series J Preferred Units for Series J Preferred Shares to the extent that
ownership or right to acquire such shares would cause the Partner or any other
Person or, in the opinion of counsel selected by the General Partner, may cause
the Partner or any other Person, to violate the restrictions on ownership and
transfer of Series J Preferred Shares set forth in the Charter, taking into
account any exceptions thereto granted by the Company in accordance with the
terms of the Charter. To the extent any such attempted exchange for Series J
Preferred Shares would be in violation of the previous sentence, it shall be
void ab initio and such Series J Limited Partner shall not acquire any rights or
economic interest in the Series J Preferred Shares otherwise issuable upon such
exchange.
(iv) The redemption of Series J Preferred Units described
in Section 18.8.A(ii) and (iii) shall be subject to the provisions of Section
18.5.B(i) and Section 18.5.C(ii); provided, however, that the term "Redemption
Price" in such Sections 18.5.B(i) and 18.5.C(ii) shall be read to mean the
original Capital Contribution per Series J Preferred Unit being redeemed as set
forth on Exhibit A plus all accrued and unpaid distributions to the redemption
date.
B. Procedure for Exchange and/or Redemption of Series J
Preferred Units.
(i) Any exchange shall be exercised pursuant to a notice
of exchange (the "Exchange Notice") delivered to the General Partner by the
Partners representing at least 51% of the outstanding Series J Preferred Units
(or by Contributor in the case of an exchange pursuant to the last sentence of
Section 18.8.A.(i) hereof) by (a) fax and (b) by certified mail postage prepaid.
The General Partner may effect any exchange of Series J Preferred Units, or
exercise its option to cause the Partnership to redeem any portion of the Series
J Preferred Units for cash pursuant to Section 18.8.A(ii) or redeem Excess Units
pursuant to Section 18.8.A(iii), by
80
delivering to each holder of record of Series J Preferred Units, within ten (10)
Business Days following receipt of the Exchange Notice, (a) if the General
Partner elects to cause the Partnership to acquire any of the Series J Preferred
Units then outstanding, (1) certificates representing the Series J Preferred
Shares being issued in exchange for the Series J Preferred Units of such holder
being exchanged and (2) a written notice (a "Redemption Notice") stating (A) the
redemption date, which may be the date of such Redemption Notice or any other
date which is not later than sixty (60) days following the receipt of the
Exchange Notice, (B) the redemption price, (C) the place or places where the
Series J Preferred Units are to be surrendered and (D) that distributions on the
Series J Preferred Units will cease to accrue on such redemption date, or (b) if
the General Partner elects to cause the Partnership to redeem all of the Series
J Preferred Units then outstanding in exchange for cash, a Redemption Notice.
Series J Preferred Units shall be deemed canceled (and any corresponding
Partnership Interest represented thereby deemed terminated) simultaneously with
the delivery of shares of Series J Preferred Shares (with respect to Series J
Preferred Units exchanged) or simultaneously with the redemption date (with
respect to Series J Preferred Units redeemed). Holders of Series J Preferred
Units shall deliver any canceled certificates representing Series J Preferred
Units which have been exchanged or redeemed to the office of General Partner
(which currently is located at Xxxx 0, Xxx 0, Xxx Xxxxxxxxx, Xxxxxxxxxx 94111)
within ten (10) Business Days of the exchange or redemption with respect
thereto. Notwithstanding anything to the contrary contained herein, any and all
Series J Preferred Units to be exchanged for Series J Preferred Stock pursuant
to this Section 18.8 shall be so exchanged in a single transaction at one time.
As a condition to exchange, the General Partner may require the holders of
Series J Preferred Units to make such representations as may be reasonably
necessary for the General Partner to establish that the issuance of Series J
Preferred Shares pursuant to the exchange shall not be required to be registered
under the Securities Act or any state securities laws. Any Series J Preferred
Shares issued pursuant to this Section 18.8 shall be delivered as shares which
are duly authorized, validly issued, fully paid and nonassessable, free of any
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.
The certificates representing the Series J Preferred Shares
issued upon exchange of the Series J Preferred Units shall contain the following
legend:
THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT
BE TRANSFERRED, SOLD, ASSIGNED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"), AND STATE SECURITIES LAWS OR (B) IF THE
CORPORATION HAS BEEN FURNISHED WITH A SATISFACTORY
OPINION OF COUNSEL FOR THE HOLDER OF THE SHARES
REPRESENTED HEREBY, OR OTHER EVIDENCE SATISFACTORY
TO THE CORPORATION, THAT SUCH TRANSFER, SALE,
ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER
DISPOSITION IS EXEMPT FROM THE PROVISIONS OF SECTION
5 OF THE ACT AND STATE SECURITIES LAWS AND THE RULES
AND REGULATIONS THEREUNDER.
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(ii) In the event of an exchange of Series J Preferred
Units for Series J Preferred Shares, an amount equal to the accrued and unpaid
distributions to the date of exchange on any Series J Preferred Units tendered
for exchange shall (i) accrue on the Series J Preferred Shares into which such
Series J Preferred Units are exchanged, and (ii) continue to accrue on such
Series J Preferred Units, which shall remain outstanding following such
exchange, with the General Partner as the holder of such Series J Preferred
Units. Notwithstanding anything to the contrary set forth herein, in no event
shall a holder of a Series J Preferred Unit that was validly exchanged for
Series J Preferred Shares pursuant to this section (other than the General
Partner holding such Series J Preferred Unit following any such exchange),
receive a distribution out of Available Cash of the Partnership, if such holder,
after exchange, is entitled to receive a distribution out of Available Cash with
respect to the Series J Preferred Shares for which such Series J Preferred Unit
was exchanged or redeemed. Further for purposes of the foregoing, in the event
of an exchange of Series J Preferred Units for Series J Preferred Shares, if the
accrued and unpaid distributions per Series J Preferred Unit is not the same for
each Series J Preferred Unit, the accrued and unpaid distributions per Series J
Preferred Unit for each such Series J Preferred Unit shall be equal to the
greatest amount of such accrued and unpaid distributions per Series J Preferred
Unit on any such unit.
(iii) Fractional Series J Preferred Shares are not to be
issued upon exchange but, in lieu thereof, the General Partner will pay a cash
adjustment based upon the fair market value of the Series J Preferred Shares 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 Price. 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 J Preferred Shares 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 J 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 Series J
Preferred Shares or fraction thereof into which one Series J Preferred Unit was
exchangeable immediately prior to such transaction. The General Partner may not
become a party to any such transaction unless the terms thereof are consistent
with the foregoing.
Section 18.9 No Conversion Rights
The Series J Preferred Units shall not be convertible into any
other class or series of interest in the Partnership.
Section 18.10 No Sinking Fund
No sinking fund shall be established for the retirement or
redemption of Series J Preferred Units.
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ARTICLE 19.
SERIES K PREFERRED UNITS
Section 19.1 Designation and Number
A series of Partnership Units in the Partnership designated as
the 7.95% Series K Cumulative Redeemable Preferred Units (the "Series K
Preferred Units") is hereby established. The number of Series K Preferred Units
shall be 800,000.
Section 19.2 Ranking
The Series K Preferred Units shall, with respect to
distribution rights and rights upon voluntary or involuntary liquidation,
winding up or dissolution of the Partnership, rank (i) senior to the Common
Units and to all Partnership Units the terms of which provide that such
Partnership Units shall rank junior to the Series K Preferred Units; (ii) on a
parity with the Series J Preferred Units, the Series L Preferred Units, the
Series M Preferred Units and all other Parity Preferred Units; and (iii) junior
to all Partnership Units which rank senior to the Series K Preferred Units.
Section 19.3 Distributions
A. Payment of Distributions. Subject to the rights of
holders of Parity Preferred Units (including the Series J Preferred Units, the
Series L Preferred Units and the Series M Preferred Units) as to the payment of
distributions, pursuant to Section 5.1, Section 18.3.A, Section 20.3.A and
Section 21.3.A hereof, holders of Series K Preferred Units will be entitled to
receive, when, as and if declared by the Partnership acting through the General
Partner, out of Available Cash, cumulative preferential cash distributions in an
amount equal to the Series K Priority Return. Such distributions will be payable
(A) quarterly in arrears, on the 15th day of January, April, July and October of
each year and (B) in the event of (i) an exchange of Series K Preferred Units
into Series K Preferred Shares, or (ii) a redemption of Series K Preferred
Units, on the exchange date or redemption date, as applicable (each a "Series K
Preferred Unit Distribution Payment Date"), commencing on the first of such
payment dates to occur following their original date of issuance. If any date on
which distributions are to be made on the Series K Preferred Units is not a
Business Day, then payment of the distribution to be made 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
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 K Preferred Units will be
made to the holders of record of the Series K Preferred Units on the relevant
record dates, which will be fifteen (15) days prior to the relevant Preferred
Unit Distribution Payment Date (the "Series K Preferred Unit Partnership Record
Date").
B. Distributions Cumulative. Notwithstanding the
foregoing, distributions on the Series K Preferred Units will accrue whether or
not the terms and provisions of any agreement of the Partnership at any time
prohibit the current payment of distributions, whether or not the Partnership
has earnings, whether or not there are funds legally available for the payment
of such distributions and whether or not such distributions are authorized.
Accrued but
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unpaid distributions on the Series K Preferred Units will accumulate as of the
Preferred Unit Distribution Payment Date on which they first become payable.
C. Priority as to Distributors.
(i) So long as any Series K 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 Interest represented by Junior Units, nor shall any Junior
Units or Parity Preferred Units (including the Series J Preferred Units, the
Series L Preferred Units and the Series M Preferred Units) be redeemed,
purchased or otherwise acquired for any consideration (or any monies be paid to
or made available for a sinking fund for the redemption of any such Junior Units
or Parity Preferred Units) by the Partnership (except by conversion into or
exchange for other Junior Units or Parity Preferred Units) unless, in each case,
full cumulative distributions have been or contemporaneously are authorized and
paid or authorized and a sum sufficient for the payment thereof set apart for
such payment on the Series K Preferred Units and all classes and series of
outstanding Parity Preferred Units for all distribution periods. The foregoing
sentence will not prohibit (a) distributions payable solely in Junior Units, (b)
the exchange of Junior Units or Parity Preferred Units (including the Series J
Preferred Units, the Series L Preferred Units and the Series M Preferred Units)
into Partnership Interests of the Partnership ranking junior to the Series K
Preferred Units as to distributions, or (c) the redemption of Partnership
Interests corresponding to Series K Preferred Shares, Parity Preferred Stock
(including Series J Preferred Shares, Series L Preferred Shares and Series M
Preferred Shares) with respect to distributions or Junior Stock to be purchased
by the General Partner pursuant to the Charter to preserve the General Partner's
status as a real estate investment trust, provided that such redemption shall be
upon the same terms as the corresponding stock purchase pursuant to the Charter.
(ii) So long as distributions have not been paid in full
(or a sum sufficient for such full payment is not so set apart) upon the Series
K Preferred Units and any other Parity Preferred Units (including the Series J
Preferred Units, the Series L Preferred Units and the Series M Preferred Units),
all distributions authorized and declared on the Series K Preferred Units and
all classes or series of outstanding Parity Preferred Units (including the
Series J Preferred Units, the Series L Preferred Units and the Series M
Preferred Units) shall be authorized and declared pro rata so that the amount of
distributions authorized and declared per Series K 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 K 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 do not have cumulative
distribution rights) bear to each other. No interest, or sum of money in lieu of
interest, shall be payable in respect of any distributions or payments on Series
K Preferred Units which may be in arrears.
(iii) Notwithstanding anything to the contrary set forth
herein, distributions on Partnership Interests held by either (a) the General
Partner or (b) any other holder of Partnership Interest in the Partnership, in
each case ranking junior to or on parity with the Series K Preferred Units may
be made, without preserving the priority of distributions described in Sections
19.3.C(i) and (ii), but (i) only to the extent such distributions are required
to preserve the real
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estate investment trust status of the General Partner and (ii) in the case of
any holder other than the General Partner only to the extent required by the
Partnership Agreement.
D. No Further Rights. Holders of Series K Preferred
Units shall not be entitled to any distributions, whether payable in cash, other
property or otherwise, in excess of the full cumulative distributions described
herein.
Section 19.4 Liquidation Proceeds
A. Distributions. Upon voluntary or involuntary
liquidation, dissolution or winding-up of the Partnership, distributions on the
Series K Preferred Units shall be made in accordance with Article 13 of this
Agreement.
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 the
General Partner pursuant to Section 13.6 hereof.
C. No Further Rights. After payment of the full amount
of the liquidating distributions to which they are entitled, Holders of Series K
Preferred Units will have no right or claim to any of the remaining assets of
the Partnership.
D. Consolidation, Merger or Certain Other Transactions.
None of a consolidation or merger of the Partnership with or into another
entity, a merger of another entity with or into the Partnership, or a sale,
lease, transfer or conveyance of all or substantially all of the Partnership's
property or business shall be considered a liquidation, dissolution or winding
up of the Partnership.
Section 19.5 Redemption
A. Redemption. The Series K Preferred Units may not be
redeemed prior to April 17, 2007. On or after such date, the Partnership shall
have the right to redeem the Series K 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 K Preferred Units (the "Redemption
Price"); provided, however, that no redemption pursuant to this Section 19.5
will be permitted if the Redemption Price does not equal or exceed the original
Capital Contribution of such holder plus the cumulative Priority Return to the
redemption date to the extent not previously distributed. If fewer than all of
the outstanding Series K Preferred Units are to be redeemed, the Series K
Preferred Units to be redeemed shall be selected pro rata (as nearly as
practicable without creating fractional units).
B. Limitation on Redemption. (i) The Redemption Price of
the Series K Preferred Units (other than the portion thereof consisting of
accumulated but unpaid distributions) is payable solely out of the sale proceeds
of capital stock of the General Partner, which will be contributed by the
General Partner to the Partnership as an additional capital contribution, or out
of the sale of limited partner interests in the Partnership and from no other
source. For purposes of the preceding sentence, "capital stock" means any equity
securities (including Common Stock and Preferred Stock (as such terms are
defined in the Charter)),
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depository shares, interests, participation or other ownership interests
(however designated) and any rights (other than debt securities convertible into
or exchangeable for equity securities) or options to purchase any of the
foregoing.
(ii) The Partnership may not redeem fewer than all of the
outstanding Series K Preferred Units unless all accumulated and unpaid
distributions have been paid on all Series K Preferred Units for all quarterly
distribution periods terminating on or prior to the date of redemption.
C. Procedures for Redemption. (i) Notice of redemption
will be (i) faxed, and (ii) 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 respective holders of record of the Series K Preferred
Units 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 K 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: (a)
the redemption date, (b) the Redemption Price, (c) the aggregate number of
Series K Preferred Units to be redeemed and if fewer than all of the outstanding
Series K Preferred Units are to be redeemed, the number of Series K 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 aggregate number of outstanding
Series K Preferred Units that the total number of Series K Preferred Units held
by such holder represents) of the aggregate number of Series K Preferred Units
to be redeemed, (d) the place or places where such Series K Preferred Units are
to be surrendered for payment of the Redemption Price, (e) that distributions on
the Series K Preferred Units to be redeemed will cease to accumulate on such
redemption date and (f) that payment of the Redemption Price will be made upon
presentation and surrender of such Series K Preferred Units.
(ii) If the Partnership gives a notice of redemption in
respect of Series K Preferred Units (which notice will be irrevocable) then, by
12:00 noon, New York City time, on the redemption date, the Partnership will
deposit irrevocably in trust for the benefit of the Series K Preferred Units
being redeemed funds sufficient to pay the applicable Redemption Price and will
give irrevocable instructions and authority to pay such Redemption Price to the
holders of the Series K Preferred Units upon surrender of the Series K Preferred
Units by such holders at the place designated in the notice of redemption. On
and after the date of redemption, distributions will cease to accumulate on the
Series K Preferred Units or portions thereof called for redemption, unless the
Partnership defaults in the payment thereof. If any date fixed for redemption of
Series K 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 and not paid
by the Partnership, distributions on such Series K 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.
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Section 19.6 Voting Rights
A. General. Holders of the Series K Preferred Units will
not have any voting rights or right to consent to any matter requiring the
consent or approval of the Limited Partners, except as set forth below and in
Section 7.3.E.
B. Certain Voting Rights. So long as any Series K
Preferred Units remain outstanding, the Partnership shall not, without the
affirmative vote of the holders of at least two-thirds of the Series K 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 prior to the Series K Preferred Units with respect to payment of
distributions or rights upon liquidation, dissolution or winding-up or
reclassify any Partnership Interests of the Partnership into any such
Partnership Interest, or create, authorize or issue any obligations or security
convertible into or evidencing the right to purchase any such Partnership
Interests, (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 Partnership Interest or create, authorize or issue any
obligations or security convertible into or evidencing the right to purchase any
such Partnership Interests but only to the extent such Parity Preferred Units
are issued to an affiliate of the Partnership, 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 who are not affiliates of the
Partnership or (iii) either consolidate, merge into or with, or convey, transfer
or lease its assets substantially as an entirety to, any corporation or other
entity or amend, alter or repeal the provisions of the Partnership Agreement
(including, without limitation, this Article 19), whether by merger,
consolidation or otherwise, in each case in a manner that would materially and
adversely affect the powers, special rights, preferences, privileges or voting
power of the Series K Preferred Units or the holders thereof; provided, however,
that with respect to the occurrence of any event set forth in (iii) above, so
long as (a) the Partnership is the surviving entity and the Series K Preferred
Units remain outstanding with the terms thereof unchanged, or (b) the resulting,
surviving or transferee entity (I) is a partnership, limited liability company
or other pass-through entity organized under the laws of any state, (II) is not
taxable as a corporation for U.S. federal income tax purposes and (III)
substitutes the Series K Preferred Units for other interests in such entity
having substantially the same terms and rights as the Series K Preferred Units,
including with respect to distributions, voting rights and rights upon
liquidation, dissolution or winding-up, then the occurrence of any such event
shall not be deemed to materially and adversely affect such rights, privileges
or voting powers of the holders of the Series K Preferred Units; and provided
further, that any increase in the amount of Partnership Interests or the
creation or issuance of any other class or series of Partnership Interests
represented by Junior Units or Parity Preferred Units are not issued to an
affiliate of the Partnership, 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 who are not affiliates of the
Partnership, shall not be deemed to materially and adversely affect such rights,
preferences, privileges or voting powers.
Section 19.7 Transfer Restrictions
The Series K Preferred Units shall be subject to the
provisions of Article 11 hereof; provided, however, that the Series K Preferred
Units shall not be subject to the right of first refusal of the General Partner
as described in Section 11.3 hereof. No transfer of Series K
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Preferred Units, or other action by the holder or holders of such Units, is
permitted, without the consent of the General Partner which consent may be given
or withheld in its sole and absolute discretion, if such transfer or other
action would result in more than two partners holding all outstanding Series K
Preferred Units within the meaning of Treasury Regulation Section
1.7704-1(h)(1)(ii) (without regard to Treasury Regulation Section
1.7704-1(h)(3)(ii)); provided, however, that the General Partner's consent may
not be unreasonably withheld if (a) such transfer or other action would not
result in more than five partners holding all outstanding Series K Preferred
Units within the meaning of Treasury Regulation Section 1.7704-1(h)(1)(ii)
(without regard to Treasury Regulation Section 1.7704-1(h)(3)(ii)) and (b) the
General Partner cannot rely on Treasury Regulation Section 1.7704-1(h) to avoid
classification of Operating Partnership as a PTP. In addition, no transfer may
be made to any person if such transfer would cause the exchange of the Series K
Preferred Units for Series K Preferred Shares, as provided herein, to be
required to be registered under the Securities Act of 1933, as amended, or any
state securities laws. If (i) the holders of 51% of the Series K Preferred Units
conclude based on results or projected results that there exists (in the
reasonable judgment of such holders) an imminent and substantial risk that such
holder's interest in the Partnership represents or will represent more than
19.5% of the total profits or capital interests in the Partnership for a taxable
year (the "19.5% Limit"), (ii) such holders deliver to the General Partner an
opinion of independent counsel to the effect that there is a substantial risk
that such holder's interest in the Partnership represents or will represent more
than the 19.5% Limit (determined in accordance with Regulations Section
1.731-2(e)(4)), and (iii) the General Partner agrees with the conclusions
referred to in clauses (i) and (ii) of this sentence, such agreement not to be
unreasonably withheld, then such holders shall, subject to the above
limitations, be permitted to transfer so much of their Series K Preferred Units
as may be appropriate to alleviate the risk of not satisfying the 19.5% Limit to
the trust described in Exhibit J, with such holders having the rights set forth
in such Exhibit.
Section 19.8 Exchange Rights
A. Right to Exchange. (i) Series K Preferred Units will be
exchangeable in whole but not in part unless expressly otherwise provided herein
at anytime on or after October 30, 2012, at the option of the holders of 51% of
all outstanding Series K Preferred Units, for authorized but previously unissued
Series K Preferred Shares at an exchange rate of one Series K Preferred Share
from the General Partner for one Series K Preferred Unit, subject to adjustment
as described below (the "Exchange Price"), provided that the Series K Preferred
Units will become exchangeable at any time, in whole but not in part unless
expressly otherwise provided herein, at the option of the holders of 51% of all
outstanding Series K Preferred Units for Series K Preferred Shares if at any
time full distributions shall not have been timely made on any Series K
Preferred Unit with respect to six (6) prior quarterly distribution periods,
whether or not consecutive, provided, however, that a distribution in respect of
Series K Preferred Units shall be considered timely made if made within two (2)
Business Days after the applicable Preferred Unit Distribution Payment Date if
at the time of such late payment there shall not be any prior quarterly
distribution periods in respect of which full distributions were not timely
made. Furthermore, the Series K Preferred Units, if the holders of 51% of all
outstanding Series K Preferred Units so determine, may be exchanged in whole but
not in part (regardless of whether held by one or more holders) for Series K
Preferred Shares if (1) the holders of 51% of all outstanding Series K Preferred
Units conclude based on results or projected results that there exists (in the
reasonable judgment of such holder) an imminent and substantial risk that the
88
holder's interest in the Partnership represents or will represent more than the
19.5% Limit, (2) such holders deliver to the General Partner an opinion of
independent counsel to the effect that there is a substantial risk that its
interest in the Partnership does not or will not satisfy the 19.5% Limit and (3)
the General Partner agrees with the conclusions referred to in clauses (1) and
(2) of this sentence, such agreement not to be unreasonably withheld; provided,
however, that if, as a result of such conclusion, such holders' interest in the
Partnership is reduced pursuant to the last sentence of Section 19.7 hereof
(which procedure shall be available to such holders to the exclusion of the
procedure under this sentence for so long as, on a cumulative basis, sales of
10% or fewer of the Series K Preferred Units originally issued by the
Partnership would in the opinion of the above-referenced counsel reduce the risk
that such holders' interest in the Partnership would not satisfy the 19.5% Limit
to less than a substantial risk, and thereafter shall be a permitted alternative
to the procedure pursuant to this sentence) or the risk of such holder not
satisfying the 19.5% Limit otherwise is reduced below a substantial risk, then
an exchange in whole under this sentence shall not be permitted unless and until
a change in facts occurs and a further determination by such holders is made
under this sentence.
(ii) Notwithstanding anything to the contrary set forth in
Section 19.8.A(i), if an Exchange Notice (as defined herein) has been delivered
to the General Partner, then the General Partner may, at its option, within ten
(10) Business Days after receipt of the Exchange Notice, elect to cause the
Partnership to redeem all or a portion of the outstanding Series K Preferred
Units for cash in an amount equal to the original Capital Contribution per
Series K Preferred Unit and all accrued and unpaid distributions thereon to the
date of redemption. If the General Partner elects to redeem fewer than all of
the outstanding Series K Preferred Units, the number of Series K Preferred Units
held by each holder to be redeemed shall equal such holder's pro rata share
(based on the percentage of the aggregate number of outstanding Series K
Preferred Units that the total number of Series K Preferred Units held by such
holder represents) of the aggregate number of Series K Preferred Units being
redeemed.
(iii) In the event an exchange of all Series K Preferred
Units pursuant to Section 19.8.A would violate the provisions on ownership
limitation of the General Partner set forth in Section 7 of the Third Article of
the Articles Supplementary to the Charter with respect to Series K Preferred
Shares (the "Series K Articles Supplementary"), each holder of Series K
Preferred Units shall be entitled to exchange, pursuant to the provisions of
Section 19.8.B, a number of Series K Preferred Units which would comply with the
provisions on the ownership limitation of the General Partner set forth in such
Section 7 of the Series K Articles Supplementary, with respect to such holder,
and any Series K Preferred Units not so exchanged (the "Excess Units") shall be
redeemed by the Partnership for cash in an amount equal to the original Capital
Contribution per Excess Unit, plus any accrued and unpaid distributions thereon
to the date of redemption subject to any restriction thereon contained in any
debt instrument or agreement of the Partnership. In the event an exchange would
result in Excess Units, as a condition to such exchange, each holder of such
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 9.0% of the
stock of the General Partner; and (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. For
purposes of determining the number of Excess Units under this Section
19.8.A(iii), the "Beneficial Ownership Limit" and
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"Constructive Ownership Limit" set forth in the Series K Articles Supplementary
shall be deemed to be 9.0%. To the extent the General Partner would not be able
to pay the cash set forth above in exchange for the Excess Units, and to the
extent consistent with the Charter, the General Partner agrees that it will
grant to the holders of the Series K Preferred Units exceptions to the
Beneficial Ownership Limit and Constructive Ownership Limit set forth in the
Series K Articles Supplementary sufficient to allow such holders to exchange all
of their Series K Preferred Units for Series K Preferred Stock, provided such
holders furnish to the General Partner representations acceptable to the General
Partner in its sole and absolute discretion which assure the General Partner
that such exceptions will not jeopardize the General Partner's tax status as a
REIT for purposes of federal and applicable state law. Notwithstanding any
provision of this Agreement to the contrary, no Series K Limited Partner shall
be entitled to effect an exchange of Series K Preferred Units for Series K
Preferred Shares to the extent that ownership or right to acquire such shares
would cause the Partner or any other Person or, in the opinion of counsel
selected by the General Partner, may cause the Partner or any other Person, to
violate the restrictions on ownership and transfer of Series K Preferred Shares
set forth in the Charter, taking into account any exceptions thereto granted by
the Company in accordance with the terms of the Charter. To the extent any such
attempted exchange for Series K Preferred Shares would be in violation of the
previous sentence, it shall be void ab initio and such Series K Limited Partner
shall not acquire any rights or economic interest in the Series K Preferred
Shares otherwise issuable upon such exchange.
(iv) The redemption of Series K Preferred Units described
in Section 19.8.A(ii) and (iii) shall be subject to the provisions of Section
19.5.B(i) and Section 19.5.C(ii); provided, however, that the term "Redemption
Price" in such Sections 19.5.B(i) and 19.5.C(ii) shall be read to mean the
original Capital Contribution per Series K Preferred Unit being redeemed as set
forth on Exhibit A plus all accrued and unpaid distributions to the redemption
date.
B. Procedure for Exchange and/or Redemption of Series K
Preferred Units.
(i) Any exchange shall be exercised pursuant to a notice
of exchange (the "Exchange Notice") delivered to the General Partner by the
Partners representing at least 51% of the outstanding Series K Preferred Units
(or by Contributor in the case of an exchange pursuant to the last sentence of
Section 19.8.A.(i) hereof) by (a) fax and (b) by certified mail postage prepaid.
The General Partner may effect any exchange of Series K Preferred Units, or
exercise its option to cause the Partnership to redeem any portion of the Series
K Preferred Units for cash pursuant to Section 19.8.A(ii) or redeem Excess Units
pursuant to Section 19.8.A(iii), by delivering to each holder of record of
Series K Preferred Units, within ten (10) Business Days following receipt of the
Exchange Notice, (a) if the General Partner elects to cause the Partnership to
acquire any of the Series K Preferred Units then outstanding, (1) certificates
representing the Series K Preferred Shares being issued in exchange for the
Series K Preferred Units of such holder being exchanged and (2) a written notice
(a "Redemption Notice") stating (A) the redemption date, which may be the date
of such Redemption Notice or any other date which is not later than sixty (60)
days following the receipt of the Exchange Notice, (B) the redemption price, (C)
the place or places where the Series K Preferred Units are to be surrendered and
(D) that distributions on the Series K Preferred Units will cease to accrue on
such redemption date, or (b) if the General Partner elects to cause the
Partnership to redeem all of the Series K Preferred Units then outstanding in
exchange for cash, a Redemption Notice.
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Series K Preferred Units shall be deemed canceled (and any corresponding
Partnership Interest represented thereby deemed terminated) simultaneously with
the delivery of shares of Series K Preferred Shares (with respect to Series K
Preferred Units exchanged) or simultaneously with the redemption date (with
respect to Series K Preferred Units redeemed). Holders of Series K Preferred
Units shall deliver any canceled certificates representing Series K Preferred
Units which have been exchanged or redeemed to the office of General Partner
(which currently is located at Xxxx 0, Xxx 0, Xxx Xxxxxxxxx, Xxxxxxxxxx 94111)
within ten (10) Business Days of the exchange or redemption with respect
thereto. Notwithstanding anything to the contrary contained herein, any and all
Series K Preferred Units to be exchanged for Series K Preferred Stock pursuant
to this Section 19.8 shall be so exchanged in a single transaction at one time.
As a condition to exchange, the General Partner may require the holders of
Series K Preferred Units to make such representations as may be reasonably
necessary for the General Partner to establish that the issuance of Series K
Preferred Shares pursuant to the exchange shall not be required to be registered
under the Securities Act or any state securities laws. Any Series K Preferred
Shares issued pursuant to this Section 19.8 shall be delivered as shares which
are duly authorized, validly issued, fully paid and nonassessable, free of any
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.
The certificates representing the Series K Preferred Shares
issued upon exchange of the Series K Preferred Units shall contain the following
legend:
THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE
TRANSFERRED, SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF EXCEPT (A) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"), AND STATE
SECURITIES LAWS OR (B) IF THE CORPORATION HAS BEEN
FURNISHED WITH A SATISFACTORY OPINION OF COUNSEL FOR
THE HOLDER OF THE SHARES REPRESENTED HEREBY, OR OTHER
EVIDENCE SATISFACTORY TO THE CORPORATION, THAT SUCH
TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR
OTHER DISPOSITION IS EXEMPT FROM THE PROVISIONS OF
SECTION 5 OF THE ACT AND STATE SECURITIES LAWS AND
THE RULES AND REGULATIONS THEREUNDER.
(ii) In the event of an exchange of Series K Preferred
Units for Series K Preferred Shares, an amount equal to the accrued and unpaid
distributions to the date of exchange on any Series K Preferred Units tendered
for exchange shall (i) accrue on the Series K Preferred Shares into which such
Series K Preferred Units are exchanged, and (ii) continue to accrue on such
Series K Preferred Units, which shall remain outstanding following such
exchange, with the General Partner as the holder of such Series K Preferred
Units. Notwithstanding anything to the contrary set forth herein, in no event
shall a holder of a Series K Preferred Unit that was validly exchanged for
Series K Preferred Shares pursuant to this section (other than the General
Partner holding such Series K Preferred Unit following any such exchange),
receive a distribution out of Available Cash of the Partnership, if such holder,
after
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exchange, is entitled to receive a distribution out of Available Cash with
respect to the Series K Preferred Shares for which such Series K Preferred Unit
was exchanged or redeemed. Further for purposes of the foregoing, in the event
of an exchange of Series K Preferred Units for Series K Preferred Shares, if the
accrued and unpaid distributions per Series K Preferred Unit is not the same for
each Series K Preferred Unit, the accrued and unpaid distributions per Series K
Preferred Unit for each such Series K Preferred Unit shall be equal to the
greatest amount of such accrued and unpaid distributions per Series K Preferred
Unit on any such unit.
(iii) Fractional Series K Preferred Shares are not to be
issued upon exchange but, in lieu thereof, the General Partner will pay a cash
adjustment based upon the fair market value of the Series K Preferred Shares 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 Price. 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 K Preferred Shares 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 K 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 Series K
Preferred Shares or fraction thereof into which one Series K Preferred Unit was
exchangeable immediately prior to such transaction. The General Partner may not
become a party to any such transaction unless the terms thereof are consistent
with the foregoing.
Section 19.9 No Conversion Rights
The Series K Preferred Units shall not be convertible into any
other class or series of interest in the Partnership.
Section 19.10 No Sinking Fund
No sinking fund shall be established for the retirement or
redemption of Series K Preferred Units.
ARTICLE 20.
SERIES L PREFERRED UNITS
Section 20.1 Designation and Number
A series of Partnership Units in the Partnership designated as
the 6 1/2% Series L Cumulative Redeemable Preferred Units (the "Series L
Preferred Units") is hereby established. The number of Series L Preferred Units
shall be 2,300,000.
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Section 20.2 Ranking
The Series L Preferred Units shall, with respect to
distribution rights and rights upon voluntary or involuntary liquidation,
winding up or dissolution of the Partnership, rank (i) senior to the Common
Units and to all Partnership Units the terms of which provide that such
Partnership Units shall rank junior to the Series L Preferred Units; (ii) on a
parity with the Series J Preferred Units, the Series K Preferred Units, the
Series M Preferred Units and all other Parity Preferred Units; and (iii) junior
to all Partnership Units which rank senior to the Series L Preferred Units.
Section 20.3 Distributions
A. Payments of Distribution. Subject to the rights of
holders of Parity Preferred Units (including Series J Preferred Units, Series K
Preferred Units and Series M Preferred Units) as to the payment of
distributions, pursuant to Section 5.1, Section 18.3.A, Section 19.3.A and
Section 21.3.A hereof, the General Partner, as holder of the Series L Preferred
Units, will be entitled to receive, when, as and if declared by the Partnership
acting through the General Partner, out of Available Cash, cumulative
preferential cash distributions in an amount equal to the Series L Priority
Return. Such distributions will be payable (A) quarterly in arrears, on the 15th
day of January, April, July and October of each year and (B) in the event of a
redemption of Series L Preferred Units, on the redemption date (each a "Series L
Preferred Unit Distribution Payment Date"), commencing on the first of such
payment dates to occur following their original date of issuance. If any date on
which distributions are to be made on the Series L Preferred Units is not a
Business Day, then payment of the distribution to be made 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
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.
B. No Distributions in Contravention of Agreements. No
distribution on the Series L Preferred Units shall be authorized by the General
Partner or made or set apart for payment by the Partnership at such time as the
terms and provisions of any agreement of the Partnership or the General Partner,
including any agreement relating to indebtedness, prohibits such declaration,
payment or setting apart for payment or provides that such declaration, payment
or setting apart for payment would constitute a breach thereof, or a default
thereunder, or if such declaration or payment shall be restricted or prohibited
by law.
C. Priority as to Distributions. (i) Except to the
extent set forth in Section 20.3.C(ii), so long as any Series L 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 Interest represented by Junior Units, nor shall any Junior
Units or Parity Preferred Units (including the Series J Preferred Units, the
Series K Preferred Units and the Series M Preferred Units) be redeemed,
purchased or otherwise acquired for any consideration (or any monies be paid to
or made available for a sinking fund for the redemption of any such Junior Units
or Parity Preferred Units) by the Partnership (except by conversion into or
exchange for other Junior Units or Parity Preferred Units) unless, in each case,
full cumulative distributions have been or contemporaneously are authorized and
paid or authorized and a sum sufficient for the payment thereof set apart for
such payment on the Series L Preferred Units for
93
all past distribution periods and the current distribution period. The foregoing
sentence will not prohibit (a) distributions payable solely in Junior Units, (b)
the exchange of Junior Units or Parity Preferred Units (including Series J
Preferred Units, Series K Preferred Units and Series M Preferred Units) into
Partnership Interests of the Partnership ranking junior to the Series L
Preferred Units as to distributions, or (c) the redemption of Partnership
Interests corresponding to Series L Preferred Shares, Parity Preferred Stock
(including Series J Preferred Shares, Series K Preferred Shares and Series M
Preferred Shares) with respect to distributions or Junior Stock to be purchased
by the General Partner pursuant to the Charter to preserve the General Partner's
status as a real estate investment trust, provided that such redemption shall be
upon the same terms as the corresponding stock purchase pursuant to the Charter.
(ii) So long as distributions have not been paid in full
(or a sum sufficient for such full payment is not so set apart) upon the Series
L Preferred Units and any other Parity Preferred Units (including Series J
Preferred Units, Series K Preferred Units and Series M Preferred Units), all
distributions authorized and declared on the Series L Preferred Units and all
classes or series of outstanding Parity Preferred Units (including the Series J
Preferred Units, Series K Preferred Units and Series M Preferred Units) shall be
authorized and declared pro rata so that the amount of distributions authorized
and declared per Series L 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 L 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 do not have cumulative distribution rights)
bear to each other. No interest, or sum of money in lieu of interest, shall be
payable in respect of any distributions or payments on Series L Preferred Units
which may be in arrears.
D. No Further Rights. The General Partner, as holder of
the Series L Preferred Units, shall not be entitled to any distributions,
whether payable in cash, other property or otherwise, in excess of the full
cumulative distributions described herein. Any distribution payment made on the
Series L Preferred Units shall first be credited against the earliest accrued
but unpaid distribution due with respect to such Series L Preferred Units which
remain payable.
Section 20.4 Liquidation Proceeds
A. Upon voluntary or involuntary liquidation,
dissolution or winding-up of the Partnership, distributions on the Series L
Preferred Units shall be made in accordance with Article 13 of this Agreement.
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 the
General Partner pursuant to Section 13.6 hereof.
C. No Further Rights. After payment of the full amount
of the liquidating distributions to which they are entitled, the General
Partner, as holder of the Series L Preferred Units, will have no right or claim
to any of the remaining assets of the Partnership.
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D. Consolidation, Merger or Certain Other Transactions.
None of a consolidation or merger of the Partnership with or into another
entity, a merger of another entity with or into the Partnership, or a sale,
lease, transfer or conveyance of all or substantially all of the Partnership's
property or business shall be considered a liquidation, dissolution or winding
up of the Partnership.
Section 20.5 Redemption
A. Redemption. The Series L Preferred Units may not be
redeemed prior to June 23, 2008. If, on or after such date, the General Partner
elects to redeem any of the Series L Preferred Shares, the Partnership shall, on
the date set for redemption of such Series L Preferred Shares, redeem the number
of Series L Preferred Units equal to the number of Series L Preferred Shares for
which the General Partner has given notice of redemption pursuant to Section 5
of Article Third of the Series L Articles Supplementary, at a redemption price,
payable in cash, equal to the product of (i) the number of Series L Preferred
Units being redeemed, and (ii) the sum of $25 and the Preferred Distribution
Shortfall per Series L Preferred Unit, if any.
B. Payment of Accumulated Distributions. Immediately
prior to any redemption of Series L Preferred Units, the Partnership shall pay,
in cash, any accumulated and unpaid distributions on the Series L Preferred
Units to be redeemed through the redemption date. Except as provided above, the
Partnership will make no payment or allowance for unpaid distributions, whether
or not in arrears, on Series L Preferred Units for which a notice of redemption
has been given.
C. Procedures for Redemption. The following provisions
set forth the procedures for Redemption:
(i) Notice of redemption will be given by the General
Partner to the Partnership concurrently with the
notice of the General Partner sent to the holders of
its Series L Preferred Shares in connection with such
redemption. Such notice shall state: (A) the
redemption date; (B) the redemption price; (C) the
number of Series L Preferred Units to be redeemed;
(D) the place or places where the Series L Preferred
Units are to be surrendered for payment of the
redemption price; and (E) that distributions on the
Series L Preferred Units to be redeemed will cease to
accumulate on such redemption date. If less than all
of the Series L Preferred Units are to be redeemed,
the notice shall also specify the number of Series L
Preferred Units to be redeemed.
(ii) On or after the redemption date, the General Partner
shall present and surrender the certificates, if any,
representing the Series L Preferred Units to the
Partnership at the place designated in the notice of
redemption and thereupon the redemption price of such
Units (including all accumulated and unpaid
distributions up to the redemption date) shall be
paid to the General Partner and each surrendered Unit
certificate, if any, shall be canceled. If fewer than
all the Units represented by any such certificate
representing Series L Preferred Units are to be
redeemed, a new certificate shall be issued
representing the unredeemed shares.
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(iii) From and after the redemption date (unless the
Partnership defaults in payment of the redemption
price), all distributions on the Series L Preferred
Units designated for redemption in such notice shall
cease to accumulate and all rights of the General
Partner, except the right to receive the redemption
price thereof (including all accumulated and unpaid
distributions up to the redemption date), shall cease
and terminate, and such Units shall not be deemed to
be outstanding for any purpose whatsoever. At its
election, the Partnership, prior to a redemption
date, may irrevocably deposit the redemption price
(including accumulated and unpaid distributions to
the redemption date) of the Series L Preferred Units
so called for redemption in trust for the General
Partner with a bank or trust company, in which case
the redemption notice to General Partner shall (A)
state the date of such deposit, (B) specify the
office of such bank or trust company as the place of
payment of the redemption price and (C) require the
General Partner to surrender the certificates, if
any, representing such Series L Preferred Units at
such place on or about the date fixed in such
redemption notice (which may not be later than the
redemption date) against payment of the redemption
price (including all accumulated and unpaid
distributions to the redemption date). Any monies so
deposited which remain unclaimed by the General
Partner at the end of two years after the redemption
date shall be returned by such bank or trust company
to the Partnership.
E. No Further Rights. Any Series L Preferred Units that
shall at any time have been redeemed shall, after such redemption, have the
status of authorized but unissued Preferred Units, without designation as to
series until such shares are once more designated as part of a particular series
by the General Partner.
Section 20.6 Voting Rights
The General Partner shall not have any voting or consent
rights in respect of its partnership interest represented by the Series L
Preferred Units.
Section 20.7 Transfer Restrictions
The Series L Preferred Units shall not be transferable.
Section 20.8 No Conversion Rights
The Series L Preferred Units shall not be convertible into any
other class or series of interest in the Partnership.
Section 20.9 No Sinking Fund
No sinking fund shall be established for the retirement or
redemption of Series L Preferred Units.
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ARTICLE 21.
SERIES M PREFERRED UNITS
Section 21.1 Designation and Number
A series of Partnership Units in the Partnership designated as
the 6 3/4% Series M Cumulative Redeemable Preferred Units (the "Series M
Preferred Units") is hereby established. The number of Series M Preferred Units
shall be 2,300,000.
Section 21.2 Ranking
The Series M Preferred Units shall, with respect to
distribution rights and rights upon voluntary or involuntary liquidation,
winding up or dissolution of the Partnership, rank (i) senior to the Common
Units and to all Partnership Units the terms of which provide that such
Partnership Units shall rank junior to the Series M Preferred Units; (ii) on a
parity with the Series J Preferred Units, the Series K Preferred Units, the
Series L Preferred Units and all other Parity Preferred Units; and (iii) junior
to all Partnership Units which rank senior to the Series M Preferred Units.
Section 21.3 Distributions
A. Payments of Distribution. Subject to the rights of
holders of Parity Preferred Units (including Series J Preferred Units, Series K
Preferred Units and Series L Preferred Units) as to the payment of
distributions, pursuant to Section 5.1, Section 18.3.A, Section 19.3.A and
Section 20.3.A hereof, the General Partner, as holder of the Series M Preferred
Units, will be entitled to receive, when, as and if declared by the Partnership
acting through the General Partner, out of Available Cash, cumulative
preferential cash distributions in an amount equal to the Series M Priority
Return. Such distributions will be payable (A) quarterly in arrears, on the 15th
day of January, April, July and October of each year and (B) in the event of a
redemption of Series M Preferred Units, on the redemption date (each a "Series M
Preferred Unit Distribution Payment Date"), commencing on the first of such
payment dates to occur following their original date of issuance. If any date on
which distributions are to be made on the Series M Preferred Units is not a
Business Day, then payment of the distribution to be made 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
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.
B. No Distributions in Contravention of Agreements. No
distribution on the Series M Preferred Units shall be authorized by the General
Partner or made or set apart for payment by the Partnership at such time as the
terms and provisions of any agreement of the Partnership or the General Partner,
including any agreement relating to indebtedness, prohibits such declaration,
payment or setting apart for payment or provides that such declaration, payment
or setting apart for payment would constitute a breach thereof, or a default
thereunder, or if such declaration or payment shall be restricted or prohibited
by law.
C. Priority as to Distributions. (i) Except to the
extent set forth in Section 21.3.C(ii), so long as any Series M 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
97
any class or series of Partnership Interest represented by Junior Units, nor
shall any Junior Units or Parity Preferred Units (including the Series J
Preferred Units, the Series K Preferred Units and the Series L Preferred Units)
be redeemed, purchased or otherwise acquired for any consideration (or any
monies be paid to or made available for a sinking fund for the redemption of any
such Junior Units or Parity Preferred Units) by the Partnership (except by
conversion into or exchange for other Junior Units or Parity Preferred Units)
unless, in each case, full cumulative distributions have been or
contemporaneously are authorized and paid or authorized and a sum sufficient for
the payment thereof set apart for such payment on the Series M Preferred Units
for all past distribution periods and the current distribution period. The
foregoing sentence will not prohibit (a) distributions payable solely in Junior
Units, (b) the exchange of Junior Units or Parity Preferred Units (including the
Series J Preferred Units, Series K Preferred Units and Series L Preferred Units)
into Partnership Interests of the Partnership ranking junior to the Series M
Preferred Units as to distributions, or (c) the redemption of Partnership
Interests corresponding to Series M Preferred Shares, Parity Preferred Stock
(including Series J Preferred Shares, Series K Preferred Shares and Series L
Preferred Shares) with respect to distributions or Junior Stock to be purchased
by the General Partner pursuant to the Charter to preserve the General Partner's
status as a real estate investment trust, provided that such redemption shall be
upon the same terms as the corresponding stock purchase pursuant to the Charter.
(ii) So long as distributions have not been paid in full
(or a sum sufficient for such full payment is not so set apart) upon the Series
M Preferred Units and any other Parity Preferred Units (including the Series J
Preferred Units, Series K Preferred Units and Series L Preferred Units), all
distributions authorized and declared on the Series M Preferred Units and all
classes or series of outstanding Parity Preferred Units (including the Series J
Preferred Units, Series K Preferred Units and Series L Preferred Units) shall be
authorized and declared pro rata so that the amount of distributions authorized
and declared per Series M 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 M 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 do not have cumulative distribution rights)
bear to each other. No interest, or sum of money in lieu of interest, shall be
payable in respect of any distributions or payments on Series M Preferred Units
which may be in arrears.
D. No Further Rights. The General Partner, as holder of
the Series M Preferred Units, shall not be entitled to any distributions,
whether payable in cash, other property or otherwise, in excess of the full
cumulative distributions described herein. Any distribution payment made on the
Series M Preferred Units shall first be credited against the earliest accrued
but unpaid distribution due with respect to such Series M Preferred Units which
remain payable.
Section 21.4 Liquidation Proceeds
A. Upon voluntary or involuntary liquidation,
dissolution or winding-up of the Partnership, distributions on the Series M
Preferred Units shall be made in accordance with Article 13 of this Agreement.
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
98
place or places where, the amounts distributable in such circumstances shall be
payable, shall be given by the General Partner pursuant to Section 13.6 hereof.
C. No Further Rights. After payment of the full amount
of the liquidating distributions to which they are entitled, the General
Partner, as holder of the Series M Preferred Units, will have no right or claim
to any of the remaining assets of the Partnership.
D. Consolidation, Merger or Certain Other Transactions.
None of a consolidation or merger of the Partnership with or into another
entity, a merger of another entity with or into the Partnership, or a sale,
lease, transfer or conveyance of all or substantially all of the Partnership's
property or business shall be considered a liquidation, dissolution or winding
up of the Partnership.
Section 21.5 Redemption
A. Redemption. The Series M Preferred Units may not be
redeemed prior to November 25, 2008. If, on or after such date, the General
Partner elects to redeem any of the Series M Preferred Shares, the Partnership
shall, on the date set for redemption of such Series M Preferred Shares, redeem
the number of Series M Preferred Units equal to the number of Series M Preferred
Shares for which the General Partner has given notice of redemption pursuant to
Section 5 of Article Third of the Series M Articles Supplementary, at a
redemption price, payable in cash, equal to the product of (i) the number of
Series M Preferred Units being redeemed, and (ii) the sum of $25 and the
Preferred Distribution Shortfall per Series M Preferred Unit, if any.
B. Payment of Accumulated Distributions. Immediately
prior to any redemption of Series M Preferred Units, the Partnership shall pay,
in cash, any accumulated and unpaid distributions on the Series M Preferred
Units to be redeemed through the redemption date. Except as provided above, the
Partnership will make no payment or allowance for unpaid distributions, whether
or not in arrears, on Series M Preferred Units for which a notice of redemption
has been given.
C. Procedures for Redemption. The following provisions
set forth the procedures for Redemption:
(i) Notice of redemption will be given by the General
Partner to the Partnership concurrently with the
notice of the General Partner sent to the holders of
its Series M Preferred Shares in connection with such
redemption. Such notice shall state: (A) the
redemption date; (B) the redemption price; (C) the
number of Series M Preferred Units to be redeemed;
(D) the place or places where the Series M Preferred
Units are to be surrendered for payment of the
redemption price; and (E) that distributions on the
Series M Preferred Units to be redeemed will cease to
accumulate on such redemption date. If less than all
of the Series M Preferred Units are to be redeemed,
the notice shall also specify the number of Series M
Preferred Units to be redeemed.
(ii) On or after the redemption date, the General Partner
shall present and surrender the certificates, if any,
representing the Series M Preferred Units
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to the Partnership at the place designated in the
notice of redemption and thereupon the redemption
price of such Units (including all accumulated and
unpaid distributions up to the redemption date) shall
be paid to the General Partner and each surrendered
Unit certificate, if any, shall be canceled. If fewer
than all the Units represented by any such
certificate representing Series M Preferred Units are
to be redeemed, a new certificate shall be issued
representing the unredeemed shares.
(iii) From and after the redemption date (unless the
Partnership defaults in payment of the redemption
price), all distributions on the Series M Preferred
Units designated for redemption in such notice shall
cease to accumulate and all rights of the General
Partner, except the right to receive the redemption
price thereof (including all accumulated and unpaid
distributions up to the redemption date), shall cease
and terminate, and such Units shall not be deemed to
be outstanding for any purpose whatsoever. At its
election, the Partnership, prior to a redemption
date, may irrevocably deposit the redemption price
(including accumulated and unpaid distributions to
the redemption date) of the Series M Preferred Units
so called for redemption in trust for the General
Partner with a bank or trust company, in which case
the redemption notice to General Partner shall (A)
state the date of such deposit, (B) specify the
office of such bank or trust company as the place of
payment of the redemption price and (C) require the
General Partner to surrender the certificates, if
any, representing such Series M Preferred Units at
such place on or about the date fixed in such
redemption notice (which may not be later than the
redemption date) against payment of the redemption
price (including all accumulated and unpaid
distributions to the redemption date). Any monies so
deposited which remain unclaimed by the General
Partner at the end of two years after the redemption
date shall be returned by such bank or trust company
to the Partnership.
E. No Further Rights. Any Series M Preferred Units that
shall at any time have been redeemed shall, after such redemption, have the
status of authorized but unissued Preferred Units, without designation as to
series until such shares are once more designated as part of a particular series
by the General Partner.
Section 21.6 Voting Rights
The General Partner shall not have any voting or consent
rights in respect of its partnership interest represented by the Series M
Preferred Units.
Section 21.7 Transfer Restrictions
The Series M Preferred Units shall not be transferable.
Section 21.8 No Conversion Rights
The Series M Preferred Units shall not be convertible into any
other class or series of interest in the Partnership.
100
Section 21.9 No Sinking Fund
No sinking fund shall be established for the retirement or
redemption of Series M Preferred Units.
(Signature Page Follows)
101
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
GENERAL PARTNER:
AMB PROPERTY CORPORATION,
a Maryland corporation
By:/s/ Xxxxxxx X. Coke
_________________________________________________________
Xxxxxxx X. Coke
Chief Financial Officer and Executive Vice President
LIMITED PARTNERS:
AMB PROPERTY CORPORATION,
as attorney-in-fact for each of the Limited Partners
By: /s/ Xxxxxxx X. Coke
_________________________________________________________
Xxxxxxx X. Coke
Chief Financial Officer and Executive Vice President
S-1
EXHIBIT A
PARTNERS, CONTRIBUTIONS, AND PARTNERSHIP INTERESTS
I. COMMON UNITS
AGREED VALUE OF COMMON
CONTRIBUTION CASH CONTRIBUTED TOTAL PARTNERSHIP PERCENTAGE
NAME OF PARTNER DATE CONTRIBUTIONS PROPERTY CONTRIBUTIONS UNITS INTEREST
------------------------------------------ ------------ ------------- --------------- --------------- ----------- ----------
General Partner:
AMB Property Corporation (a) 11/26/97 $73,798,710 $1,693,339,826 $1,767,138,536 85,645,102 99.37816%
AMB Property Corporation 12/15/98 $0 $0 $0 43,008 0.04990%
AMB Property Corporation 01/20/99 $100,000 $0 $100,000 100,000 0.11603%
AMB Property Corporation 01/25/99 $26,250 $0 $26,250 1,250 0.00145%
AMB Property Corporation 02/11/99 $131,250 $0 $131,250 6,250 0.00725%
AMB Property Corporation 03/05/99 $26,250 $0 $26,250 1,250 0.00145%
AMB Property Corporation 04/20/99 $26,250 $0 $26,250 1,250 0.00145%
AMB Property Corporation 04/23/99 $0 $88,290 $88,290 3,600 0.00418%
AMB Property Corporation 05/07/99 $0 $0 $0 (932) -0.00108%
AMB Property Corporation 05/12/99 $0 $10,125,213 $10,125,213 482,153 0.55947%
AMB Property Corporation 05/13/99 $78,750 $0 $78,750 3,750 0.00435%
AMB Property Corporation 06/04/99 $26,250 $0 $26,250 1,250 0.00145%
AMB Property Corporation 06/11/99 $13,125 $0 $13,125 625 0.00073%
AMB Property Corporation 06/30/99 $13,125 $0 $13,125 625 0.00073%
AMB Property Corporation 07/02/99 $52,500 $0 $52,500 2,500 0.00290%
AMB Property Corporation 08/03/99 $0 $244,000 $244,000 10,000 0.01160%
AMB Property Corporation 08/06/99 $131,250 $0 $131,250 6,250 0.00725%
AMB Property Corporation 09/15/99 $0 $840,000 $840,000 40,000 0.04641%
AMB Property Corporation 09/15/99 $0 $0 $0 (701) -0.00081%
AMB Property Corporation 12/10/99 ($198,750) $0 ($198,750) (10,000) -0.01160%
AMB Property Corporation 12/10/99 ($197,500) $0 ($197,500) (10,000) -0.01160%
AMB Property Corporation 12/10/99 ($1,657,500) $0 ($1,657,500) (85,000) -0.09863%
AMB Property Corporation 12/13/99 ($1,950,000) $0 ($1,950,000) (100,000) -0.11603%
AMB Property Corporation 12/14/99 ($9,500,000) $0 ($9,500,000) (500,000) -0.58017%
AMB Property Corporation 12/16/99 ($950,000) $0 ($950,000) (50,000) -0.05802%
AMB Property Corporation 12/16/99 ($1,813,888) $0 ($1,813,888) (96,100) -0.11151%
AMB Property Corporation 12/17/99 ($937,500) $0 ($937,500) (50,000) -0.05802%
AMB Property Corporation 12/17/99 ($8,730,150) $0 ($8,730,150) (471,900) -0.54757%
AMB Property Corporation 12/20/99 ($918,750) $0 ($918,750) (50,000) -0.05802%
AMB Property Corporation 12/20/99 ($375,950) $0 ($375,950) (20,600) -0.02390%
AMB Property Corporation 01/07/00 ($28,777,960) $0 ($28,777,960) (1,465,926) -1.70098%
AMB Property Corporation 02/29/00 $0 $0 $0 155,675 0.18064%
AMB Property Corporation 03/31/00 $262,500 $0 $262,500 12,500 0.01450%
AMB Property Corpoations 05/01/00 $105,000 $0 $105,000 5,000 0.00580%
AMB Property Corporation 05/02/00 $105,000 $0 $105,000 5,000 0.00580%
AMB Property Corporation 05/03/00 $26,250 $0 $26,250 1,250 0.00145%
AMB Property Corporation 05/05/00 $52,500 $0 $52,500 2,500 0.00290%
AMB Property Corporation 05/05/00 $0 $0 $0 1,000 0.00116%
AMB Property Corporation 05/10/00 $13,125 $0 $13,125 625 0.00073%
AMB Property Corporation 05/31/00 $26,250 $0 $26,250 1,250 0.00145%
AMB Property Corporation 06/09/00 $105,000 $0 $105,000 5,000 0.00580%
AMB Property Corporation 06/13/00 $254,334 $0 $254,334 11,790 0.01368%
AMB Property Corporation 07/06/00 $0 $4,774,010 $4,774,010 206,425 0.23952%
AMB Property Corporation 07/14/00 $128,747 $0 $128,747 6,072 0.00705%
AMB Property Corporation 07/19/00 $52,500 $0 $52,500 2,500 0.00290%
AMB Property Corporation 07/21/00 $105,000 $0 $105,000 5,000 0.00580%
AMB Property Corporation 07/26/00 $105,000 $0 $105,000 5,000 0.00580%
AMB Property Corporation 08/10/00 $26,250 $0 $26,250 1,250 0.00145%
AMB Property Corporation 08/11/00 $26,250 $0 $26,250 1,250 0.00145%
AMB Property Corporation 08/25/00 $157,500 $0 $157,500 7,500 0.00870%
AMB Property Corporation 09/06/00 $31,594 $0 $31,594 1,500 0.00174%
AMB Property Corporation 09/11/00 $94,500 $0 $94,500 4,500 0.00522%
AMB Property Corporation 09/12/00 $5,250 $0 $5,250 250 0.00029%
AMB Property Corporation 09/15/00 $52,500 $0 $52,500 2,500 0.00290%
AMB Property Corporation 10/01/00 $0 $0 $0 (298) -0.00035%
AMB Property Corporation 11/27/00 $12,600 $0 $12,600 600 0.00070%
AMB Property Corporation 11/28/00 $0 $0 $0 5,000 0.00580%
AMB Property Corporation 11/29/00 $78,750 $0 $78,750 3,750 0.00435%
AMB Property Corporation 12/01/00 $0 $0 $0 622 0.00072%
AMB Property Corporation 12/05/00 $250,250 $0 $250,250 11,789 0.01368%
AMB Property Corporation 12/06/00 $78,750 $0 $78,750 3,750 0.00435%
AMB Property Corporation 12/13/00 $12,600 $0 $12,600 600 0.00070%
AMB Property Corporation 12/15/00 $10,500 $0 $10,500 500 0.00058%
AMB Property Corporation 01/30/01 $12,446 $0 $12,446 584 0.00068%
A-1
EXHIBIT A
PARTNERS, CONTRIBUTIONS, AND PARTNERSHIP INTERESTS
AGREED VALUE OF COMMON
CONTRIBUTION CASH CONTRIBUTED TOTAL PARTNERSHIP PERCENTAGE
NAME OF PARTNER DATE CONTRIBUTIONS PROPERTY CONTRIBUTIONS UNITS INTEREST
------------------------------------------ ------------ ------------- --------------- --------------- ----------- ----------
AMB Property Corporation 02/27/01 $46,193 $0 $46,193 2,053 0.00238%
AMB Property Corporation 02/27/01 $0 $0 $0 196,517 0.22803%
AMB Property Corporation 02/28/01 $107,952 $0 $107,952 4,992 0.00579%
AMB Property Corporation 02/28/01 $0 $36,750 $36,750 1,554 0.00180%
AMB Property Corporation 03/07/01 $0 $872,202 $872,202 37,115 0.04307%
AMB Property Corporation 03/07/01 $13,125 $0 $13,125 625 0.00073%
AMB Property Corporation 03/08/01 $774,736 $0 $774,736 36,667 0.04255%
AMB Property Corporation 03/23/01 $0 $11,752,188 $11,752,188 559,268 0.64895%
AMB Property Corporation 04/18/01 ($568,750) $0 ($568,750) (25,000) -0.02901%
AMB Property Corporation 05/17/01 $0 $0 $0 1,000 0.00116%
AMB Property Corporation 05/21/01 $16,800 $0 $16,800 800 0.00093%
AMB Property Corporation 05/22/01 $0 $0 $0 41,204 0.04781%
AMB Property Corporation 06/14/01 $95,586 $0 $95,586 4,584 0.00532%
AMB Property Corporation 07/01/01 $0 $0 $0 (461) -0.00053%
AMB Property Corporation 07/12/01 $23,520 $0 $23,520 1,120 0.00130%
AMB Property Corporation 07/13/01 $5,094 $0 $5,094 250 0.00029%
AMB Property Corporation 07/16/01 $286,424 $0 $286,424 13,459 0.01562%
AMB Property Corporation 07/26/01 $21,000 $0 $21,000 1,000 0.00116%
AMB Property Corporation 07/27/01 $14,700 $0 $14,700 700 0.00081%
AMB Property Corporation 08/02/01 $90,300 $0 $90,300 4,300 0.00499%
AMB Property Corporation 08/03/01 $11,500 $0 $11,500 500 0.00058%
AMB Property Corporation 08/08/01 $5,000 $0 $5,000 250 0.00029%
AMB Property Corporation 08/09/01 $5,775 $0 $5,775 275 0.00032%
AMB Property Corporation 08/10/01 $78,750 $0 $78,750 3,750 0.00435%
AMB Property Corporation 08/14/01 $11,406 $0 $11,406 500 0.00058%
AMB Property Corporation 08/15/01 $31,500 $0 $31,500 1,500 0.00174%
AMB Property Corporation 08/17/01 $14,063 $0 $14,063 625 0.00073%
AMB Property Corporation 08/22/01 $420,000 $0 $420,000 20,000 0.02321%
AMB Property Corporation 09/18/01 $0 $557,838 $557,838 23,700 0.02750%
AMB Property Corporation 09/20/01 ($597,500) $0 ($597,500) (25,000) -0.02901%
AMB Property Corporation 09/24/01 ($7,087,000) $0 ($7,087,000) (298,400) -0.34625%
AMB Property Corporation 09/25/01 ($550,780) $0 ($550,780) (23,100) -0.02680%
AMB Property Corporation 09/26/01 ($7,108,893) $0 ($7,108,893) (301,200) -0.34950%
AMB Property Corporation 09/27/01 ($5,857,250) $0 ($5,857,250) (250,000) -0.29009%
AMB Property Corporation 09/28/01 ($236,000) $0 ($236,000) (10,000) -0.01160%
AMB Property Corporation 10/01/01 ($1,069,350) $0 ($1,069,350) (45,000) -0.05222%
AMB Property Corporation 10/02/01 ($2,192,275) $0 ($2,192,275) (91,900) -0.10664%
AMB Property Corporation 10/19/01 $11,406 $0 $11,406 500 0.00058%
AMB Property Corporation 10/25/01 ($3,515,636) $0 ($3,515,636) (150,000) -0.17405%
AMB Property Corporation 10/26/01 ($32,550) $0 ($32,550) (1,400) -0.00162%
AMB Property Corporation 10/29/01 ($4,002,822) $0 ($4,002,822) (171,600) -0.19912%
AMB Property Corporation 10/31/01 $0 $0 $0 (340) -0.00039%
AMB Property Corporation 11/02/01 $14,258 $0 $14,258 625 0.00073%
AMB Property Corporation 11/09/01 $0 $337,710 $337,710 13,801 0.01601%
AMB Property Corporation 11/12/01 $10,500 $0 $10,500 500 0.00058%
AMB Property Corporation 11/16/01 $84,121 $0 $84,121 4,167 0.00484%
AMB Property Corporation 11/19/01 $105,000 $0 $105,000 5,000 0.00580%
AMB Property Corporation 11/20/01 $39,375 $0 $39,375 1,875 0.00218%
AMB Property Corporation 11/23/01 $5,344 $0 $5,344 250 0.00029%
AMB Property Corporation 11/26/01 $13,125 $0 $13,125 625 0.00073%
AMB Property Corporation 11/27/01 $105,000 $0 $105,000 5,000 0.00580%
AMB Property Corporation 11/28/01 $52,500 $0 $52,500 2,500 0.00290%
AMB Property Corporation 12/05/01 $105,000 $0 $105,000 5,000 0.00580%
AMB Property Corporation 12/07/01 $77,344 $0 $77,344 3,125 0.00363%
AMB Property Corporation 12/11/01 $210,000 $0 $210,000 10,000 0.01160%
AMB Property Corporation 12/17/01 $6,063 $0 $6,063 250 0.00029%
AMB Property Corporation 12/26/01 $1,346,486 $0 $1,346,486 64,009 0.07427%
AMB Property Corporation 01/01/02 ($780,067) $0 ($780,067) (29,945) -0.03475%
AMB Property Corporation 01/02/02 $88,863 $0 $88,863 4,168 0.00484%
AMB Property Corporation 01/11/02 $0 $266,413 $266,413 10,227 0.01187%
AMB Property Corporation 01/11/02 $5,219 $0 $5,219 250 0.00029%
AMB Property Corporation 01/29/02 $182,128 $0 $182,128 8,500 0.00986%
AMB Property Corporation 01/31/02 $53,976 $0 $53,976 2,496 0.00290%
AMB Property Corporation 02/01/02 $0 $634,825 $634,825 25,884 0.03003%
AMB Property Corporation 02/06/02 $53,275 $0 $53,275 2,501 0.00290%
AMB Property Corporation 02/12/02 $38,746 $0 $38,746 1,917 0.00222%
A-2
EXHIBIT A
PARTNERS, CONTRIBUTIONS, AND PARTNERSHIP INTERESTS
AGREED VALUE OF COMMON
CONTRIBUTION CASH CONTRIBUTED TOTAL PARTNERSHIP PERCENTAGE
NAME OF PARTNER DATE CONTRIBUTIONS PROPERTY CONTRIBUTIONS UNITS INTEREST
------------------------------------------ ------------ ------------- --------------- --------------- ----------- ----------
AMB Property Corporation 02/26/02 $0 $0 $0 194,585 0.22579%
AMB Property Corporation 02/27/02 $28,750 $0 $28,750 1,250 0.00145%
AMB Property Corporation 02/27/02 $0 $0 $0 1,500 0.00174%
AMB Property Corporation 03/06/02 $13,125 $0 $13,125 625 0.00073%
AMB Property Corporation 03/13/02 $70,000 $0 $70,000 3,000 0.00348%
AMB Property Corporation 03/14/02 $210,000 $0 $210,000 10,000 0.01160%
AMB Property Corporation 03/15/02 $98,805 $0 $98,805 4,834 0.00561%
AMB Property Corporation 03/18/02 $25,547 $0 $25,547 1,250 0.00145%
AMB Property Corporation 04/11/02 $10,313 $0 $10,313 500 0.00058%
AMB Property Corporation 04/12/02 $2,045,067 $0 $2,045,067 96,084 0.11149%
AMB Property Corporation 04/15/02 $439,101 $0 $439,101 20,522 0.02381%
AMB Property Corporation 04/17/02 $358,965 $0 $358,965 16,667 0.01934%
AMB Property Corporation 04/22/02 $102,508 $0 $102,508 4,167 0.00484%
AMB Property Corporation 04/30/02 $5,844 $0 $5,844 250 0.00029%
AMB Property Corporation 05/01/02 $24,451 $0 $24,451 1,084 0.00126%
AMB Property Corporation 05/02/02 $115,375 $0 $115,375 5,500 0.00638%
AMB Property Corporation 05/28/02 $237,098 $0 $237,098 10,834 0.01257%
AMB Property Corporation 05/30/02 $0 $0 $0 7,987 0.00927%
AMB Property Corporation 06/01/02 $0 $0 $0 (1,445) -0.00168%
AMB Property Corporation 06/03/02 $119,063 $0 $119,063 5,625 0.00653%
AMB Property Corporation 06/04/02 $346,298 $0 $346,298 15,000 0.01741%
AMB Property Corporation 06/05/02 $2,100 $0 $2,100 100 0.00012%
AMB Property Corporation 06/06/02 $50,400 $0 $50,400 2,400 0.00278%
AMB Property Corporation 06/07/02 $36,750 $0 $36,750 1,750 0.00203%
AMB Property Corporation 06/11/02 $28,672 $0 $28,672 1,250 0.00145%
AMB Property Corporation 06/12/02 $123,000 $0 $123,000 5,000 0.00580%
AMB Property Corporation 06/15/02 $0 $0 $0 (700) -0.00081%
AMB Property Corporation 07/05/02 $0 $1,844,967 $1,844,967 86,529 0.10040%
AMB Property Corporation 07/11/02 $37,626 $0 $37,626 1,584 0.00184%
AMB Property Corporation 07/24/02 $39,900 $0 $39,900 1,900 0.00220%
AMB Property Corporation 07/25/02 ($1,752,651) $0 ($1,752,651) (65,000) -0.07542%
AMB Property Corporation 07/26/02 ($6,565,737) $0 ($6,565,737) (246,900) -0.28649%
AMB Property Corporation 07/29/02 ($2,574,390) $0 ($2,574,390) (100,000) -0.11603%
AMB Property Corporation 07/30/02 $37,126 $0 $37,126 1,584 0.00184%
AMB Property Corporation 07/30/02 ($559,643) $0 ($559,643) (21,300) -0.02472%
AMB Property Corporation 08/01/02 $2,730,000 $0 $2,730,000 130,000 0.15085%
AMB Property Corporation 08/01/02 $0 $0 $0 (300) -0.00035%
AMB Property Corporation 08/07/02 $10,250 $0 $10,250 500 0.00058%
AMB Property Corporation 08/08/02 $210,000 $0 $210,000 10,000 0.01160%
AMB Property Corporation 08/09/02 $9,906 $0 $9,906 500 0.00058%
AMB Property Corporation 08/20/02 $5,453 $0 $5,453 250 0.00029%
AMB Property Corporation 08/26/02 $630,000 $0 $630,000 30,000 0.03481%
AMB Property Corporation 08/27/02 $59,757 $0 $59,757 2,273 0.00264%
AMB Property Corporation 08/29/02 $1,071,000 $0 $1,071,000 51,000 0.05918%
AMB Property Corporation 08/30/02 $1,066,141 $0 $1,066,141 50,584 0.05870%
AMB Property Corporation 09/06/02 $5,344 $0 $5,344 250 0.00029%
AMB Property Corporation 09/09/02 $43,066 $0 $43,066 2,083 0.00242%
AMB Property Corporation 09/13/02 $1,093,980 $0 $1,093,980 49,444 0.05737%
AMB Property Corporation 09/30/02 $0 $0 $0 (734) -0.00085%
AMB Property Corporation 10/04/02 $17,248 $0 $17,248 700 0.00081%
AMB Property Corporation 10/16/02 ($15,385,933) $0 ($15,385,933) (614,700) -0.71327%
AMB Property Corporation 10/17/02 ($7,103,024) $0 ($7,103,024) (268,700) -0.31179%
AMB Property Corporation 10/18/02 ($2,073,576) $0 ($2,073,576) (78,200) -0.09074%
AMB Property Corporation 10/21/02 $36,960 $0 $36,960 1,500 0.00174%
AMB Property Corporation 10/21/02 ($3,837,636) $0 ($3,837,636) (145,200) -0.16848%
AMB Property Corporation 10/25/02 ($5,296) $0 ($5,296) (200) -0.00023%
AMB Property Corporation 10/28/02 $18,480 $0 $18,480 750 0.00087%
AMB Property Corporation 10/28/02 ($2,269,640) $0 ($2,269,640) (86,100) -0.09991%
AMB Property Corporation 11/14/02 $34,219 $0 $34,219 1,500 0.00174%
AMB Property Corporation 11/20/02 $11,000 $0 $11,000 500 0.00058%
AMB Property Corporation 11/25/02 ($16,635,272) $0 ($16,635,292) (625,900) -0.72626%
AMB Property Corporation 11/26/02 ($4,031,790) $0 ($4,031,790) (151,700) -0.17602%
AMB Property Corporation 11/27/02 ($1,081,806) $0 ($1,081,806) (40,700) -0.04723%
AMB Property Corporation 11/29/02 $19,712 $0 $19,712 800 0.00093%
AMB Property Corporation 11/29/02 ($5,497,184) $0 ($5,497,184) (207,000) -0.24019%
AMB Property Corporation 12/02/02 $6,073 $0 $6,073 250 0.00029%
A-3
EXHIBIT A
PARTNERS, CONTRIBUTIONS, AND PARTNERSHIP INTERESTS
AGREED VALUE OF COMMON
CONTRIBUTION CASH CONTRIBUTED TOTAL PARTNERSHIP PERCENTAGE
NAME OF PARTNER DATE CONTRIBUTIONS PROPERTY CONTRIBUTIONS UNITS INTEREST
------------------------------------------ ------------ ------------- --------------- --------------- ----------- ----------
AMB Property Corporation 12/03/02 $12,183 $0 $12,183 500 0.00058%
AMB Property Corporation 01/08/03 $24,600 $0 $24,600 1,000 0.00116%
AMB Property Corporation 01/16/03 $11,688 $0 $11,688 500 0.00058%
AMB Property Corporation 01/23/03 $33,632 $0 $33,632 1,666 0.00193%
AMB Property Corporation 01/23/03 ($9,114,230) $0 ($9,114,230) (350,000) -0.40612%
AMB Property Corporation 01/24/03 ($3,914,564) $0 ($3,914,564) (150,000) -0.17405%
AMB Property Corporation 01/27/03 ($5,236,412) $0 ($5,236,412) (200,400) -0.23253%
AMB Property Corporation 01/28/03 ($2,296,872) $0 ($2,296,872) (87,400) -0.10141%
AMB Property Corporation 01/30/03 $312,508 $0 $312,508 14,167 0.01644%
AMB Property Corporation 01/31/03 $5,703 $0 $5,703 250 0.00029%
AMB Property Corporation 02/03/03 $18,218 $0 $18,218 750 0.00087%
AMB Property Corporation 02/13/03 $0 $0 $0 253,662 0.29434%
AMB Property Corporation 02/19/03 $210,000 $0 $210,000 10,000 0.01160%
AMB Property Corporation 02/24/03 $11,250 $0 $11,250 500 0.00058%
AMB Property Corporation 02/26/03 $5,703 $0 $5,703 250 0.00029%
AMB Property Corporation 02/28/03 $86,235 $0 $86,235 4,000 0.00464%
AMB Property Corporation 03/14/03 $434,625 $0 $434,625 20,584 0.02388%
AMB Property Corporation 03/31/03 $23,875 $0 $23,875 1,000 0.00116%
AMB Property Corporation 04/03/03 $12,156 $0 $12,156 500 0.00058%
AMB Property Corporation 04/16/03 $5,156 $0 $5,156 250 0.00029%
AMB Property Corporation 05/09/03 $6,028 $0 $6,028 250 0.00029%
AMB Property Corporation 05/12/03 $23,000 $0 $23,000 1,000 0.00116%
AMB Property Corporation 05/15/03 $1,173,889 $0 $1,173,889 49,351 0.05726%
AMB Property Corporation 05/20/03 $105,000 $0 $105,000 5,000 0.00580%
AMB Property Corporation 05/22/03 $315,000 $0 $315,000 15,000 0.01741%
AMB Property Corporation 05/22/03 $0 $0 $0 8,958 0.01039%
AMB Property Corporation 05/28/03 $63,000 $0 $63,000 3,000 0.00348%
AMB Property Corporation 06/02/03 $894,708 $0 $894,708 42,139 0.04890%
AMB Property Corporation 06/03/03 $4,953 $0 $4,953 250 0.00029%
AMB Property Corporation 06/05/03 $52,500 $0 $52,500 2,500 0.00290%
AMB Property Corporation 06/09/03 $43,825 $0 $43,825 1,667 0.00193%
AMB Property Corporation 06/11/03 $102,837 $0 $102,837 4,251 0.00493%
AMB Property Corporation 06/13/03 $41,063 $0 $41,063 1,800 0.00209%
AMB Property Corporation 06/27/03 $73,881 $0 $73,881 3,434 0.00398%
AMB Property Corporation 07/02/03 $329,063 $0 $329,063 15,000 0.01741%
AMB Property Corporation 07/15/03 $23,156 $0 $23,156 1,000 0.00116%
AMB Property Corporation 07/16/03 ($677,210) $0 ($677,210) (25,100) -0.02912%
AMB Property Corporation 07/25/03 $105,000 $0 $105,000 5,000 0.00580%
AMB Property Corporation 07/30/03 $5,835 $0 $5,835 250 0.00029%
AMB Property Corporation 08/05/03 $16,688 $0 $16,688 750 0.00087%
AMB Property Corporation 08/11/03 $12,180 $0 $12,180 580 0.00067%
AMB Property Corporation 08/20/03 $31,500 $0 $31,500 1,500 0.00174%
AMB Property Corporation 08/29/03 $47,015 $0 $47,015 2,084 0.00242%
AMB Property Corporation 09/08/03 $5,344 $0 $5,344 250 0.00029%
AMB Property Corporation 09/09/03 $12,375 $0 $12,375 500 0.00058%
AMB Property Corporation 09/10/03 $58,160 $0 $58,160 2,000 0.00232%
AMB Property Corporation 09/12/03 $78,695 $0 $78,695 3,583 0.00416%
AMB Property Corporation 09/15/03 $10,313 $0 $10,313 500 0.00058%
AMB Property Corporation 09/18/03 $0 $0 $0 2,000 0.00232%
AMB Property Corporation 10/08/03 $252,000 $0 $252,000 12,000 0.01392%
AMB Property Corporation 10/17/03 $474,375 $0 $474,375 21,250 0.02466%
AMB Property Corporation 10/21/03 $12,580 $0 $12,580 500 0.00058%
AMB Property Corporation 10/31/03 $6,028 $0 $6,028 250 0.00029%
AMB Property Corporation 11/03/03 $330,250 $0 $330,250 15,750 0.01828%
AMB Property Corporation 11/04/03 $100,938 $0 $100,938 5,000 0.00580%
AMB Property Corporation 11/05/03 $42,188 $0 $42,180 1,875 0.00218%
AMB Property Corporation 11/06/03 $5,297 $0 $5,297 250 0.00029%
AMB Property Corporation 11/07/03 $54,301 $0 $54,301 2,300 0.00267%
AMB Property Corporation 11/11/03 $30,059 $0 $30,059 1,250 0.00145%
AMB Property Corporation 11/13/03 $10,188 $0 $10,188 500 0.00058%
AMB Property Corporation 11/14/03 $42,000 $0 $42,000 2,000 0.00232%
AMB Property Corporation 11/19/03 $643,993 $0 $643,993 29,780 0.03456%
AMB Property Corporation 11/25/03 $6,475 $0 $6,745 250 0.00029%
------------- --------------- --------------- ----------- ----------
Total General Partner (80,386,193) 1,725,714,232 1,645,328,281 81,562,767 94.64123%
A-4
EXHIBIT A
PARTNERS, CONTRIBUTIONS, AND PARTNERSHIP INTERESTS
AGREED VALUE OF COMMON
CONTRIBUTION CASH CONTRIBUTED TOTAL PARTNERSHIP PERCENTAGE
NAME OF PARTNER DATE CONTRIBUTIONS PROPERTY CONTRIBUTIONS UNITS INTEREST
------------------------------------------ ------------ ------------- --------------- --------------- ----------- ----------
Limited Partners:
Xxxxx Xxxxx 11/26/97 $0 $1,150,359 $1,150,359 54,779 0.06356%
Xxxxxx Xxxxxx 11/26/97 $0 $6,174 $6,174 294 0.00034%
Xxxxx Xxxxxx 11/26/97 $0 $216,447 $216,447 10,307 0.01196%
GP Met Phase I 11/26/97 $0 $1,774,164 $1,774,164 84,484 0.09803%
GP Met 4 & 12 11/26/97 $0 $1,486,212 $1,486,212 70,772 0.08212%
Xxxxxxxx X. Xxxxxxx 54 Trust 11/26/97 $0 $1,118,754 $1,118,754 53,274 0.06182%
Xxxxxxx X. Xxxxxxx 54 Trust 11/26/97 $0 $1,118,754 $1,118,754 53,274 0.06182%
Xxxxxxxxx X. Xxxxxxx 54 Trust 11/26/97 $0 $1,118,754 $1,118,754 53,274 0.06182%
Xxxxxxxx X. Xxxxxxx 57 Trust 11/26/97 $0 $3,919,734 $3,919,734 186,654 0.21658%
Xxxxxxx X. Xxxxxxx 57 Trust 11/26/97 $0 $3,919,734 $3,919,734 186,654 0.21658%
Xxxxxxxxx X. Xxxxxxx 57 Trust 11/26/97 $0 $3,919,734 $3,919,734 186,654 0.21658%
Xxxxxxxx X. Xxxxxxx 58 Trust 11/26/97 $0 $3,919,734 $3,919,734 186,654 0.21658%
Xxxxxxx X. Xxxxxxx 58 Trust 11/26/97 $0 $3,919,734 $3,919,734 186,654 0.21658%
Xxxxxxxxx X. Xxxxxxx 58 Trust 11/26/97 $0 $3,919,734 $3,919,734 186,654 0.21658%
Allmerica 11/26/97 $0 $11,752,188 $11,752,188 559,628 0.64936%
Xxxxxx 11/26/97 $0 $10,125,213 $10,125,213 482,153 0.55947%
Xxxxxxxxxx Investment Properties (b) 03/30/98 $0 $12,435,871 $12,435,871 517,547 0.60053%
Xxxxxxxxxx Enterprises (c) 03/30/98 $0 $10,334,678 $10,334,678 438,110 0.50836%
Xxxxx Xxxxxxxxxxx 03/31/98 $0 $1,990,798 $1,990,798 81,174 0.09419%
Xxxxxxx X. Xxxxxxx 03/31/98 $0 $634,825 $634,825 25,884 0.03003%
Xxxx Xxxxxxxx 03/31/98 $0 $266,073 $266,073 10,849 0.01259%
Xxxxx Xxxxxx 03/31/98 $0 $806,404 $806,404 32,880 0.03815%
Xxxxxxxx Properties, Inc. 06/04/98 $0 $61,250 $61,250 2,590 0.00301%
Xxxxxxx Xxxxxxxxx Xxxxxxxx 06/04/98 $0 $660,275 $660,275 27,916 0.03239%
Xxxxxx X. Xxxxxxx 06/04/98 $0 $319,725 $319,725 13,518 0.01569%
Xxxxxx X. Xxxx 06/04/98 $0 $147,000 $147,000 6,215 0.00721%
Xxxxxx Xxxxx 06/04/98 $0 $36,750 $36,750 1,554 0.00180%
Xxxxx X. Xxxxx as trustee of the
Xxxxx X. Xxxxx Living Trust under
Agreement dated August 22, 1995 06/30/98 $0 $580,747 $580,747 23,801 0.02762%
Xxxxxxxx X. Xxxxx 06/30/98 $0 $580,747 $580,747 23,801 0.02762%
Lincoln Property Company No. 238 Ltd. 09/24/98 $0 $8,320,955 $8,320,955 353,520 0.41021%
Lincoln Property Company No. 287, LTD 09/24/98 $0 $2,760,957 $2,760,957 117,300 0.13611%
Lincoln Property Company No. 355, LTD 09/24/98 $0 $739,600 $739,600 31,422 0.03646%
Lincoln Property Company No. 440, LTD 09/24/98 $0 $767,640 $767,640 32,614 0.03784%
Lincoln Property Company No. 1179 09/24/98 $0 $3,883,230 $3,883,230 164,981 0.19144%
Xxxx Xxxxxxxx 12/31/98 $0 ($44,145) ($44,145) (1,800) -0.00209%
Xxxxx X. Xxxxxxxx 12/31/98 $0 $22,073 $22,073 900 0.00104%
Xxxxxxxxx X. Xxxxxxxx 12/31/98 $0 $22,073 $22,073 900 0.00104%
Xxxx Xxxxxxxx 01/31/99 $0 ($44,145) ($44,145) (1,800) -0.00209%
Xxxxx X. Xxxxxxxx 01/31/99 $0 $22,073 $22,073 900 0.00104%
Xxxxxxxxx X. Xxxxxxxx 01/31/99 $0 $22,073 $22,073 900 0.00104%
Xxxxxxx X. Xxxxxxxx III 02/09/99 $0 $2,376 $2,376 99 0.00011%
Xxxxxx X. Xxxxxxx 02/09/99 $0 $4,056 $4,056 169 0.00020%
Xxxxxxx Xxxxxxx 02/09/99 $0 $2,808 $2,808 117 0.00014%
Xxxxxx Xxxxxxx 02/09/99 $0 $2,592 $2,592 108 0.00013%
Xxxxxx Xxxxxxx 02/09/99 $0 $144 $144 6 0.00001%
Xxxxxxxx X. Xxxxxxx 02/09/99 $0 $144 $144 6 0.00001%
RA & DM, Inc. 02/09/99 $0 $96 $96 4 0.00000%
RA & FM, Inc. 02/09/99 $0 $888 $888 37 0.00004%
Xxxxxxx X. Xxxxx 02/09/99 $0 $7,080 $7,080 295 0.00034%
Xxxxxx Xxxxxxx 02/09/99 $0 $1,080 $1,080 45 0.00005%
Xxxxxxx X. Xxxxxxx 02/09/99 $0 $1,536 $1,536 64 0.00007%
Xxxxxxx X. Xxxxxxx 02/09/99 $0 $672 $672 28 0.00003%
Xxxxx X. XxXxxxx 02/09/99 $0 $432 $432 18 0.00002%
Xxxxxx Xxxxxxx Sirota 02/09/99 $0 $912 $912 38 0.00004%
Xxxxx X. Xxxxxxxx 04/23/99 $0 ($44,145) ($44,145) (1,800) -0.00209%
Xxxxxxxxx X. Xxxxxxxx 04/23/99 $0 ($44,145) ($44,145) (1,800) -0.00209%
Xxxxxxx X. Xxxxxxxx III 04/30/99 $0 $888,379 $888,379 37,016 0.04295%
Xxxxxx X. Xxxxxxx 04/30/99 $0 $1,479,701 $1,479,701 61,654 0.07154%
Xxxxxxx Xxxxxxx 04/30/99 $0 $1,046,686 $1,046,686 43,612 0.05061%
Xxxxxx Xxxxxxx 04/30/99 $0 $966,601 $966,601 40,275 0.04673%
Xxxxxx Xxxxxxx 04/30/99 $0 $55,873 $55,873 2,328 0.00270%
Xxxxxxxx X. Xxxxxxx 04/30/99 $0 $55,873 $55,873 2,328 0.00270%
RA & DM, Inc. 04/30/99 $0 $93,122 $93,122 3,880 0.00450%
A-5
EXHIBIT A
PARTNERS, CONTRIBUTIONS, AND PARTNERSHIP INTERESTS
AGREED VALUE OF COMMON
CONTRIBUTION CASH CONTRIBUTED TOTAL PARTNERSHIP PERCENTAGE
NAME OF PARTNER DATE CONTRIBUTIONS PROPERTY CONTRIBUTIONS UNITS INTEREST
------------------------------------------ ------------ ------------- --------------- --------------- ----------- ----------
RA & FM, Inc. 04/30/99 $0 $121,732 $121,732 5,072 0.00589%
Xxxxxxx X. Xxxxx 04/30/99 $0 $2,777,815 $2,777,815 115,742 0.13430%
Xxxxxx Xxxxxxx 04/30/99 $0 $569,904 $569,904 23,746 0.02755%
Xxxxxxx X. Xxxxxxx 04/30/99 $0 $569,904 $569,904 23,746 0.02755%
Xxxxxxx X. Xxxxxxx 04/30/99 $0 $246,772 $246,772 10,282 0.01193%
Xxxxx X. XxXxxxx 04/30/99 $0 $159,238 $159,238 6,635 0.00770%
Xxxxxx Xxxxxxx Sirota 04/30/99 $0 $343,618 $343,618 14,317 0.01661%
Xxxxxx 05/12/99 $0 ($10,125,213) ($10,125,213) (482,153) -0.55947%
Xxxxxxxxxx Investment Properties, LLC 05/21/99 $0 $450,811 $450,811 18,638 0.02163%
CBDV Investors, L.L.C. 05/26/99 $0 $5,000,000 $5,000,000 212,766 0.24688%
Xxxxxx X. Xxxx 06/04/99 $0 ($147,000) ($147,000) (6,215) -0.00721%
CBDV Investors, L.L.C. 07/30/99 $0 ($5,000,000) ($5,000,000) (212,766) -0.24688%
Tiger Lafayette, L.L.C. 07/30/99 $0 $3,255,596 $3,255,596 138,536 0.16075%
Divco Western Commercial, L.L.C. 07/30/99 $0 $872,202 $872,202 37,115 0.04307%
ICCL East, L.L.C. 07/30/99 $0 $872,202 $872,202 37,115 0.04307%
Xxxxxxxx X. Xxxxx 08/03/99 $0 ($244,000) ($244,000) (10,000) -0.01160%
GP Met 4 & 12 09/15/99 $0 ($840,000) ($840,000) (40,000) -0.04641%
Lincoln Property Company No. 238 Ltd. 09/30/99 $0 $282 $282 12 0.00001%
Lincoln Property Company No. 287, Ltd 09/30/99 $0 $26,668 $26,668 1,133 0.00131%
Lincoln Property Company No. 355, Ltd. 09/30/99 $0 $45,780 $45,780 1,945 0.00226%
Lincoln Property Company No. 440, Ltd. 09/30/99 $0 $10,639 $10,639 452 0.00052%
Lincoln Property Company No. 1179 09/30/99 $0 $2,354 $2,354 100 0.00012%
Lincoln Property Company No. 238 Ltd. 09/30/99 $0 ($8,321,259) ($8,321,259) (353,532) -0.41022%
Lincoln Property Company No. 287, Ltd 09/30/99 $0 ($2,508,862) ($2,508,862) (106,590) -0.12368%
Lincoln Property Company No. 355, Ltd. 09/30/99 $0 ($765,722) ($765,722) (32,532) -0.03775%
Lincoln Property Company No. 440, Ltd. 09/30/99 $0 ($762,733) ($762,733) (32,405) -0.03760%
Lincoln Property Company No. 1179 09/30/99 $0 ($3,613,595) ($3,613,595) (153,525) -0.17814%
Xxxx Xxxxx 09/30/99 $0 $98,834 $98,834 4,199 0.00487%
Xxxxx X. Xxxxxx, Xx. 09/30/99 $0 $2,006,831 $2,006,831 85,261 0.09893%
Xxxxxxx Xxxxxxx 09/30/99 $0 $6,539,424 $6,539,424 277,830 0.32238%
Xxxx X. Xxxxx 09/30/99 $0 $112,933 $112,933 4,798 0.00557%
Xxxxxx X. Xxxxxx 09/30/99 $0 $46,698 $46,698 1,984 0.00230%
Xxxx Xxxxx Inc. 09/30/99 $0 $5,073,438 $5,073,438 215,547 0.25011%
Xxxxxx X. X'Xxxxx 09/30/99 $0 $743,761 $743,761 31,599 0.03667%
Xxxxx Xxxxx Xxxxx 09/30/99 $0 $1,350,252 $1,350,252 57,366 0.06656%
Lincoln Property Company No. 287, Ltd. 11/30/99 $0 ($278,763) ($278,763) (11,843) -0.01374%
Lincoln Property Company No. 355, Ltd. 11/30/99 $0 ($19,658) (19,658) (835) -0.00097%
Lincoln Property Company No. 440, Ltd. 11/30/99 $0 ($15,546) ($15,546) (661) -0.00077%
Lincoln Property Company No. 1179 11/30/99 $0 ($271,989) ($271,989) (11,556) -0.01341%
Xxxxxxx X. Xxxxx 01/07/00 $0 $0 $0 312,071 0.36211%
Xxxx X. Xxxxxxxx (Trust) 01/07/00 $0 $0 $0 37,013 0.04295%
T. Xxxxxx Xxxxx 01/07/00 $0 $0 $0 235,506 0.27327%
X. Xxxxx Xxxxxxxxx 01/07/00 $0 $0 $0 62,366 0.07237%
Xxxx X. Xxxxxxxx 01/07/00 $0 $0 $0 78,988 0.09165%
Xxxxx X. Xxxxxxxx 01/07/00 $0 $0 $0 25,868 0.03002%
Xxxx X. Xxxxxx 01/07/00 $0 $0 $0 32,206 0.03737%
Xxxxxxx X. Xxxx (Trust) 01/07/00 $0 $0 $0 56,028 0.06501%
Xxxxx X. Xxxxxxxx 01/07/00 $0 $0 $0 388,126 0.45036%
Xxxxx X. Xxxxxxxxx 01/07/00 $0 $0 $0 91,158 0.10578%
W. Xxxxx Xxxxx 01/07/00 $0 $0 $0 25,569 0.02967%
Xxxxxx X. Xxxxxxxx 01/07/00 $0 $0 $0 5,114 0.00593%
Xxxxx X. Xxxxxxxx 01/07/00 $0 $0 $0 3,409 0.00396%
Xxxxxxx X. Coke 01/07/00 $0 $0 $0 8,439 0.00979%
Xxxxxx X. Xxxxx 01/07/00 $0 $0 $0 3,409 0.00396%
Xxxxx X. Xxxxx 01/07/00 $0 $0 $0 3,409 0.00396%
Xxxxx X. Xxxxx 01/07/00 $0 $0 $0 15,257 0.01770%
Xxxx X. Xxxxxxxxxx 01/07/00 $0 $0 $0 5,114 0.00593%
Xxxx X. Xxxxxx 01/07/00 $0 $0 $0 6,818 0.00791%
Xxxxxx X. Xxxxxxxxx 01/07/00 $0 $0 $0 3,409 0.00396%
Xxxxx X. Xxxxxxx (Trust) 01/07/00 $0 $0 $0 6,818 0.00791%
Xxxxxx X. Xxxxxxx 01/07/00 $0 $0 $0 3,409 0.00396%
Xxxx X. Xxxxx 01/07/00 $0 $0 $0 5,114 0.00593%
Xxxx X. Xxxxxxx, Xx. 01/07/00 $0 $0 $0 8,439 0.00979%
Xxxx X. Xxxxx 01/07/00 $0 $0 $0 3,409 0.00396%
Xxxxxxx X. Xxxxxx 01/07/00 $0 $0 $0 3,409 0.00396%
Xxxxxxxxx X. Xxxxxxxxx 01/07/00 $0 $0 $0 6,733 0.00781%
A-6
EXHIBIT A
PARTNERS, CONTRIBUTIONS, AND PARTNERSHIP INTERESTS
AGREED VALUE OF COMMON
CONTRIBUTION CASH CONTRIBUTED TOTAL PARTNERSHIP PERCENTAGE
NAME OF PARTNER DATE CONTRIBUTIONS PROPERTY CONTRIBUTIONS UNITS INTEREST
------------------------------------------ ------------ ------------- --------------- --------------- ----------- ----------
Xxxxxx X. Xxxxxx 01/07/00 $0 $0 $0 5,114 0.00593%
Xxxxx X. Xxxxx 01/07/00 $0 $0 $0 5,114 0.00593%
Xxxxxxx Xxxxxxxxx 01/07/00 $0 $0 $0 6,818 0.00791%
X.X. Xxxxxxxx 01/07/00 $0 $0 $0 6,818 0.00791%
Xxxxx X. Xxxxxx 01/07/00 $0 $0 $0 3,409 0.00396%
Xxxxxx X. Xxxxxxx 01/07/00 $0 $0 $0 2,045 0.00237%
GP Met 4 +12 07/06/00 $0 ($646,212) ($646,212) (30,772) -0.03571%
ICCL East, L.L.C. 07/06/00 $0 ($872,202) ($872,202) (37,115) -0.04307%
Tiger Lafayette, L.L.C. 07/06/00 $0 ($3,255,596) ($3,255,596) (138,536) -0.16075%
AFCO Cargo DFW Limited Partnership 11/07/00 $0 $1,046,849 $1,046,849 44,523 0.05166%
WEST*PAC Limited Partnership 11/07/00 $0 $134,609 $134,609 5,725 0.00664%
AFCO Cargo SEA Limited Partnership 11/07/00 $0 $1,046,848 $1,046,848 44,523 0.05166%
Xxxxxxxxxx Investment Properties, LLC 11/09/00 $0 ($798,804) ($798,804) (34,046) -0.03951%
Xxxxxx Xxxxx 02/28/01 $0 ($36,750) ($36,750) (1,554) -0.00180%
Divco Western Commercial, L.L.C. 03/07/01 $0 ($872,202) ($872,202) (37,115) -0.04307%
Allmerica 03/23/01 $0 ($11,752,188) ($11,752,188) (559,628) -0.64936%
Xxxxxxxxxx Investment Properties, LLC 08/17/01 $0 ($1,597,608) ($1,597,608) (68,092) -0.07901%
Xxxxxx Xxxxxxxxxx 08/17/01 $0 $798,804 $798,804 34,046 0.03951%
Xxxxxxxx Xxxxxxxxxx 08/17/01 $0 $798,804 $798,804 34,046 0.03951%
Xxxxxx Xxxxxxxxxx 08/17/01 $0 ($798,804) ($798,804) (34,046) -0.03951%
Xxxxxxxx Xxxxxxxxxx 08/17/01 $0 ($798,804) ($798,804) (34,046) -0.03951%
Xxxxxxxxxx Investment Properties, LLC 09/07/01 $0 ($8,494,501) ($8,494,501) (362,046) -0.42010%
Xxxxxx Xxxxxxxxxx 09/07/01 $0 $1,923,924 $1,923,924 82,000 0.09515%
Xxxxxxxx Xxxxxxxxxx 09/07/01 $0 $1,923,924 $1,923,924 82,000 0.09515%
Xxxxxx Xxxxxxxxxx Revocable Holding Trust 09/07/01 $0 $2,722,729 $2,722,729 116,046 0.13465%
Trust B u/w Xxxxxxx Xxxxxxxxxx 09/07/01 $0 $1,923,924 $1,923,924 82,000 0.09515%
Xxxxxx Xxxxxxxxxx 09/07/01 $0 ($1,818,750) ($1,818,750) (75,000) -0.08703%
Xxxxxxxx Xxxxxxxxxx 09/07/01 $0 ($1,818,750) ($1,818,750) (75,000) -0.08703%
Xxxxxx X. X'Xxxxx 09/18/01 $0 ($557,838) ($557,838) (23,700) -0.02750%
Xxxxxxxx X. Xxxxx 11/09/01 $0 ($337,710) ($337,710) (13,801) -0.01601%
Trust B u/w Xxxxxxx Xxxxxxxxxx 11/16/01 $0 ($121,900) ($121,900) (5,000) -0.00580%
Xxxxxxx Xxxxxxxxx 01/11/02 $0 ($177,609) ($177,609) (6,818) -0.00791%
Xxxxx X. Xxxxxx 01/11/02 $0 ($88,804) ($88,804) (3,409) -0.00396%
Xxxxxxx X. Xxxxxxx 02/01/02 $0 ($634,825) ($634,825) (25,884) -0.03003%
Xxxxxxxxxx Enterprises 03/29/02 $0 ($10,334,678) ($10,334,678) (438,110) -0.50836%
Xxxxxx Xxxxxxxxxx 03/29/02 $0 $2,325,302 $2,325,302 98,575 0.11438%
Xxxxxxxx Xxxxxxxxxx 03/29/02 $0 $2,325,302 $2,325,302 98,575 0.11438%
Xxxxxx Xxxxxxxxxx Revocable Holding Trust 03/29/02 $0 $2,325,302 $2,325,302 98,575 0.11438%
Xxxxxx XxXxxxx 03/29/02 $0 $2,325,302 $2,325,302 98,575 0.11438%
Xxxxxx Xxxxxxxxxx 03/29/02 $0 $1,033,468 $1,033,468 43,810 0.05083%
Xxxxxx X. Xxxxxxx 07/05/02 $0 ($70,803) ($70,803) (2,045) -0.00237%
GP Met Phase I-95, Ltd. 07/05/02 $0 ($1,774,164) ($1,774,164) (84,484) -0.09803%
AFCO Cargo DFW Limited Partnership 04/16/03 $0 ($320,644) ($320,644) (11,524) -0.01337%
Xxxxxx Xxxxxxxxxx Revocable Holding Trust 07/25/03 $0 ($5,816,229) ($5,816,229) (214,621) -0.24904%
AFCO Cargo DFW Limited Partnership 09/10/03 $0 ($58,160) ($58,160) (2,000) -0.00232%
------------- --------------- --------------- ----------- ----------
Total Limited Partners $0 $70,419,613 $70,419,613 4,618,242 5.35877%
------------- --------------- --------------- ----------- ----------
Total General Partner and Limited Partners (80,386,193) 1,796,133,845 1,715,747,894 86,181,009 100.0%
============= =============== =============== =========== ==========
(a) Excludes 229,411 of Sub OP and Long Gate LLC shares/units and preferred
partnership units.
(b) Includes 934 units reserved.
(c) Includes 8,268 units reserved.
Reconciliation:
Total Units per above 86,181,009
Plus Sub OP & Long Gate LLC shares/units excluded (a) 229,411
Total Shares & Units as of 11/25/03 86,410,420
(d) Excludes 204,067 common limited partnership units of IMD Holding
Corporation.
A-7
EXHIBIT A
PARTNERS, CONTRIBUTIONS, AND PARTNERSHIP INTERESTS
II. SERIES J PREFERRED UNITS
Agreed Value of
Contribution Cash Contributed Total Partnership Percentage
Name of Partner Date Contributions Property Contributions Units Interest
--------------- ------------ ------------- --------------- ------------- ----------- ----------
LIMITED PARTNER:
GSEP 2001 Realty Corp. 8/21/01 $ 40,000,000 $ 0 $ 40,000,000 800,000 100.00000%
------------- --------- ------------- ------- ---------
TOTAL SERIES J PREFERRED UNITS $ 40,000,000 $ 0 $ 40,000,000 800,000 100.00000%
============= ========= ============= ======= =========
III. SERIES K PREFERRED UNITS
Agreed Value of
Contribution Cash Contributed Total Partnership Percentage
Name of Partner Date Contributions Property Contributions Units Interest
--------------- ------------ ------------- --------------- ------------- ----------- ----------
LIMITED PARTNER:
GSEP 2002 Realty Corp. 4/17/02 $ 40,000,000 $ 0 $ 40,000,000 800,000 100%
------------- --------- ------------- ------- ---
TOTAL SERIES K PREFERRED UNITS $ 40,000,000 $ 0 $ 40,000,000 800,000 100%
============= ========= ============= ======= ===
IV. SERIES L PREFERRED UNITS
Agreed Value of
Contribution Cash Contributed Total Partnership Percentage
Name of Partner Date Contributions Property Contributions Units Interest
--------------- ------------ -------------- --------------- ------------- ----------- ----------
GENERAL PARTNER:
AMB Property Corporation 6/23/03 $ 48,425,000 $ 0 $ 48,425,000 2,000,000 100.00000%
------------- --------- ------------- --------- ---------
TOTAL SERIES J PREFERRED UNITS $ 48,425,000 $ 0 $ 48,425,000 2,000,000 100.00000%
============= ========= ============= ========= =========
V. SERIES M PREFERRED UNITS
Agreed Value of
Contribution Cash Contributed Total Partnership Percentage
Name of Partner Date Contributions Property Contributions Units Interest
--------------- ------------ -------------- --------------- ------------- ----------- ----------
GENERAL PARTNER:
AMB Property Corporation 11/25/03 $ 55,688,750 $ 0 $ 55,688,750 2,300,000 100.00000%
------------- --------- ------------- --------- ---------
TOTAL SERIES M PREFERRED UNITS $ 55,688,750 $ 0 $ 55,688,750 2,300,000 100.00000%
============= ========= ============= ========= =========
A-8
EXHIBIT B
NOTICE OF REDEMPTION
The undersigned hereby [irrevocably] (i) exchanges __________
Limited Partnership Units in AMB Property, L.P. in accordance with the terms of
the Limited Partnership Agreement of AMB Property, L.P. dated as of
_________________, as amended, and the rights of Redemption referred to therein,
(ii) surrenders such Limited Partnership Units and all right, title and interest
therein and (iii) directs that the cash (or, if applicable, REIT Shares)
deliverable upon Redemption or exchange be delivered to the address specified
below, and if applicable, that such REIT Shares be registered or placed in the
name(s) and at the address(es) specified below.
Dated: ________________________
Name of Limited Partner:
_____________________________________
(Signature of Limited Partner)
_____________________________________
(Street Address)
_____________________________________
(City) (State) (Zip Code)
Signature Guaranteed by:
_____________________________________
Issue REIT Shares in the name of:
Please insert social security or identifying number:
Address (if different than above):
B-1
EXHIBIT C
CONSTRUCTIVE OWNERSHIP DEFINITION
The term "Constructively Owns" means ownership determined
through the application of the constructive ownership rules of Section 318 of
the Code, as modified by Section 856(d)(5) of the Code. Generally, these rules
provide the following:
a. an individual is considered as owning the Ownership Interest
that is owned, actually or constructively, by or for his spouse, his children,
his grandchildren, and his parents;
b. an Ownership Interest that is owned, actually or
constructively, by or for a partnership, limited liability company or estate is
considered as owned proportionately by its partners, members or beneficiaries;
c. an Ownership Interest that is owned, actually or
constructively, by or for a trust is considered as owned by its beneficiaries in
proportion to the actuarial interest of such beneficiaries (provided, however,
that in the case of a "grantor trust" the Ownership Interest will be considered
as owned by the grantors);
d. if ten percent (10%) or more in value of the stock in a
corporation is owned, actually or constructively, by or for any person, such
person shall be considered as owning the Ownership Interest that is owned,
actually or constructively, by or for such corporation in that proportion which
the value of the stock which such person so owns bears to the value of all the
stock in such corporation;
e. an Ownership Interest that is owned, actually or
constructively, by or for a partner or member which actually or constructively
owns a 25% or greater capital interest or profits interest in a partnership or
limited liability company, or by or for a beneficiary of an estate or trust,
shall be considered as owned by the partnership, limited liability company,
estate, or trust (or, in the case of a grantor trust, the grantors);
f. if ten percent (10%) or more in value of the stock in a
corporation is owned, actually or constructively, by or for any person, such
corporation shall be considered as owning the Ownership Interest that is owned,
actually or constructively, by or for such person;
g. if any person has an option to acquire an Ownership Interest
(including an option to acquire an option or any one of a series of such
options), such Ownership Interest shall be considered as owned by such person;
h. an Ownership Interest that is constructively owned by a person
by reason of the application of the rules described in paragraphs (a) through
(g) above shall, for purposes of applying paragraphs (a) through (g), be
considered as actually owned by such person provided, however, that (i) an
Ownership Interest constructively owned by an individual by reason of paragraph
(a) shall not be considered as owned by him for purposes of again applying
paragraph (a) in order to make another the constructive owner of such Ownership
Interest, (ii) an Ownership Interest constructively owned by a partnership,
estate, trust, or corporation by reason of the application of paragraphs (e) or
(f) shall not be considered as owned by it for purposes of applying paragraphs
(b), (c), or (d) in order to make another the constructive owner of such
Ownership Interest, (iii) if an Ownership Interest may be considered as owned by
an individual under paragraphs (a) or (g), it shall be considered as owned by
him under paragraph (g) and (iv) for purposes of the above described rules, an S
corporation shall be treated as a partnership and any stockholder of the S
corporation shall be treated as a partner of such partnership except that this
rule shall not apply for purposes of determining whether stock in the S
corporation is constructively owned by any person.
i. For purposes of the above summary of the constructive
ownership rules, the term "Ownership Interest" means the ownership of stock with
respect to a corporation and, with respect to any other type of entity, the
ownership of an interest in either its assets or net profits.
X-0
XXXXXXX X-0
FORM OF PARTNERSHIP UNIT CERTIFICATE
CERTIFICATE FOR PARTNERSHIP UNITS OF
AMB PROPERTY, L.P.
No. _______________ ____________ UNITS
AMB Property Corporation as the General Partner of AMB
Property, L.P., a Delaware limited partnership (the "Operating Partnership"),
hereby certifies that ____________________________ is a Limited Partner of the
Operating Partnership whose Partnership Interests therein, as set forth in the
Agreement of Limited Partnership of AMB Property, L.P., dated as of
______________, 200_ (as it may be amended, modified or supplemented from time
to time in accordance with its terms, (the "Partnership Agreement"), under which
the Operating Partnership is existing and as filed in the office of the Delaware
[State Department of Assessments and Taxation] (copies of which are on file at
the Operating Partnership's principal offices at Xxxx 0, Xxx 0, Xxx Xxxxxxxxx,
Xxxxxxxxxx, 00000, represent _________ units of limited partnership interest in
the Operating Partnership (the "Partnership Units").
THE PARTNERSHIP UNITS REPRESENTED BY THIS CERTIFICATE OR
INSTRUMENT MAY NOT BE TRANSFERRED, SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF UNLESS SUCH TRANSFER, SALE, ASSIGNMENT, PLEDGE,
HYPOTHECATION OR OTHER DISPOSITION COMPLIES WITH THE PROVISIONS OF THE
PARTNERSHIP AGREEMENT (A COPY OF WHICH IS ON FILE WITH THE OPERATING
PARTNERSHIP). EXCEPT AS OTHERWISE PROVIDED IN THE PARTNERSHIP AGREEMENT, NO
TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION OF THE
PARTNERSHIP UNITS REPRESENTED BY THIS CERTIFICATE MAY BE MADE EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"), OR (B) IF THE OPERATING PARTNERSHIP HAS BEEN
FURNISHED WITH A SATISFACTORY OPINION OF COUNSEL FOR THE HOLDER OF THE
PARTNERSHIP UNITS REPRESENTED BY THIS CERTIFICATE THAT SUCH TRANSFER, SALE
ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION IS EXEMPT FROM THE
PROVISIONS OF SECTION 5 OF THE ACT AND THE RULES AND REGULATIONS IN EFFECT
THEREUNDER.
DATED: _______________, 200_.
AMB PROPERTY CORPORATION
General Partner of
AMB Property, L.P.
ATTEST:
By:_______________________________ By: ________________________________
X-0
XXXXXXX X-0
FORM OF PARTNERSHIP UNIT CERTIFICATE
CERTIFICATE FOR PERFORMANCE UNITS OF
AMB PROPERTY, L.P.
No. _______________ ____________ UNITS
AMB Property Corporation as the General Partner of AMB
Property, L.P., a Delaware limited partnership (the "Operating Partnership"),
hereby certifies that ____________________ is a Limited Partner of the Operating
Partnership whose Partnership Interests therein, as set forth in the Agreement
of Limited Partnership of AMB Property, L.P., dated as of ______________, 200_
(as it may be amended, modified or supplemented from time to time in accordance
with its terms, (the "Partnership Agreement"), under which the Operating
Partnership is existing and as filed in the office of the Delaware [State
Department of Assessments and Taxation] (copies of which are on file at the
Operating Partnership's principal offices at Xxxx 0, Xxx 0, Xxx Xxxxxxxxx,
Xxxxxxxxxx 0000, represent____________ performance units (as defined in the
Partnership Agreement) of limited partnership interest in the Operating
Partnership (the "Performance Units").
THE PERFORMANCE UNITS REPRESENTED BY THIS CERTIFICATE OR
INSTRUMENT MAY NOT BE TRANSFERRED, SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF UNLESS SUCH TRANSFER, SALE, ASSIGNMENT, PLEDGE,
HYPOTHECATION OR OTHER DISPOSITION COMPLIES WITH THE PROVISIONS OF THE
PARTNERSHIP AGREEMENT (A COPY OF WHICH IS ON FILE WITH THE OPERATING
PARTNERSHIP). EXCEPT AS OTHERWISE PROVIDED IN THE PARTNERSHIP AGREEMENT, NO
TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION OF THE
PERFORMANCE UNITS REPRESENTED BY THIS CERTIFICATE MAY BE MADE EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"), OR (B) IF THE OPERATING PARTNERSHIP HAS BEEN
FURNISHED WITH A SATISFACTORY OPINION OF COUNSEL FOR THE HOLDER OF THE
PERFORMANCE UNITS REPRESENTED BY THIS CERTIFICATE THAT SUCH TRANSFER, SALE
ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION IS EXEMPT FROM THE
PROVISIONS OF SECTION 5 OF THE ACT AND THE RULES AND REGULATIONS IN EFFECT
THEREUNDER.
DATED:___________________ , 200_.
AMB PROPERTY CORPORATION
General Partner of
AMB Property, L.P.
ATTEST:
By:___________________________ By: __________________________
D-2
EXHIBIT E
SCHEDULE OF PARTNERS' OWNERSHIP
WITH RESPECT TO TENANTS
None.
E-1
EXHIBIT F
SCHEDULE OF REIT SHARES
ACTUALLY OR CONSTRUCTIVELY OWNED BY 25% LIMITED PARTNERS
OTHER THAN THOSE ACQUIRED PURSUANT TO AN EXCHANGE
None.
F-1
EXHIBIT G
PERFORMANCE UNITS
The Performance Units issued by the Partnership pursuant to
Section 4.3.F. were issued to the following Persons in the following amounts on
January 7, 2000:
1. The first 3,000,000 Performance Units were issued 90%
to the "Old PLPs" (as defined below) and 10% to the "New PLPs" (as defined
below).
2. Any Performance Units issued in excess of those set
forth in paragraph 1 above were issued 80% to the Old PLPs and 20% to the New
PLPs.
3. The Performance Units allocable to each group of PLPs
pursuant to paragraphs 1 and 2 above were allocated among the PLPs within such
group in accordance with each PLP's percentage interest as set forth in the
definitions below.
4. The receipt of Performance Units by a PLP was not
subject to any vesting requirements.
Definitions
"Old PLPs" means the Persons set forth on Schedule G-1 attached hereto, with the
percentage interest so indicated.
"New PLPs" means the Persons set forth on Schedule G-2 attached hereto, with the
percentage interest so indicated.
G-1
SCHEDULE X-0
XXX XXXx
Xxxx xx Xxx XXX Percentage
--------------- ----------
Xxxxxxx X. Xxxxx 23.6537%
Xxxx X. Xxxxxxxx 2.8055%
T. Xxxxxx Xxxxx 17.8504%
X. Xxxxx Xxxxxxxxx 4.7271%
Xxxx X. Xxxxxxxx 5.9870%
Xxxxx X. Xxxxxxxx 1.9607%
Xxxx Xxxxxxx Xxxxxx 2.4411%
Xxxxxxx X. Xxxx 4.2467%
Xxxxx X. Xxxxxxxx 29.4184%
Xxxxx X. Xxxxxxxxx 6.9094%
G-1
SCHEDULE X-0
XXX XXXx
Xxxx xx Xxx XXX Xxxxxxxxxx
--------------- ----------
W. Xxxxx Xxxxx 17.4419%
Xxxxxx X. Xxxxxxxx 3.4884%
Xxxxx X. Xxxxxxxx 2.3256%
Xxxxxxx X. Coke 5.7558%
Xxxxxx X. Xxxxx 2.3256%
Xxxxx X. Xxxxx 2.3256%
Xxxxx X. Xxxxx 10.4070%
Xxxx X. Xxxxxxxxxx 3.4884%
Xxxx X. Xxxxxx 4.6512%
Xxxxxx X. Xxxxxxxxx 2.3256%
Xxxxx X. Xxxxxxx 4.6512%
Xxxxxx X. Xxxxxxx 2.3256%
Xxxx X. Xxxxx 3.4884%
Xxxx X. Xxxxxxx, Xx. 5.7558%
Xxxx X. Xxxxx 2.3256%
Xxxxxxx X. Xxxxxx 2.3256%
Xxxxxxxxx X. Xxxxxxxxx 4.5930%
Xxxxxx X. Xxxxxx 3.4884%
Xxxxx X. Xxxxx 3.4884%
Xxxxxxx Xxxxxxxxx 4.6512%
X.X. Xxxxxxxx 4.6512%
Xxxxx X. Xxxxxx 2.3256%
Xxxxxx X. Xxxxxxx 1.3953%
G-2
EXHIBIT H
SCHEDULE OF CERTAIN AGREEMENTS RELATING TO
PROPERTIES WITH RESTRICTIONS ON DISPOSITION
PURSUANT TO SECTION 7.3.F
1. Joint Venture Interest Exchange /Contribution Agreement, dated November
26, 1997, by and among AMB Property, L.P., Xxxxx Xxxxx, Xxxxxx Xxxxxx
and Xxxxx Xxxxxx.
2. Joint Venture Interest Exchange/Contribution Agreement, dated November
26, 1997, by and among AMB Property, L.P., GP Met Phase One 95, Ltd.
and GP Met 4/12, Ltd.
3. Agreement for Transfer of Realty and Assets, dated November 26, 1997,
by and among AMB Property, L.P. and Xxxxxxxx X. Xxxxxxx, Xxxxxxx X.
Xxxxxxx and Xxxxxxxxx X. Xxxxxxx as Trustees for the Xxxxxxx Family
Trusts.
4. Contribution Agreement, dated November 26, 1997, between AMB Property,
L.P. and Xxxxxx Skokie Real Estate Corporation. (Allmerica Portfolio)
5. Agreement for Transfer of Realty and Assets, dated November 26, 1997,
by and among AMB Property, L.P., Xxxxxx X. Xxxxxx and Xxxxxx X. Xxxxxx.
6. Contribution Agreement, dated March 30, 1998, by and among AMB
Property, L.P. and the other parties named therein. (Xxxxxxxxxx
Portfolio)
7. Contribution Agreement, dated March 31, 1998, by and among AMB
Property, L.P., Xxxxx Xxxxxxxxxxx, Xxxxxxx X. Xxxxxxx, Xxxx Xxxxxxxx
and Xxxxx Xxxxxx.
8. Contribution Agreement, dated June 4, 1998 by and among AMB Property,
L.P. and the other parties named therein. (Southfield Portfolio)
9. Amended and Restated Contribution Agreement, dated as of August 6,
1998, by and among AMB Property, L.P., AMB Property Corporation and the
other parties named therein. (Willow Park Portfolio)
10. Portfolio Contribution Agreement, dated as of November 17, 1998, by and
among AMB Property, L.P., AMB Property Corporation and the individuals
named therein, as amended by the First Amendment, dated as of February
1, 1999, and the Second Amendment, dated as of April 30, 1999. (Manekin
Portfolio)
11. Purchase and Sale Agreement, dated as of December 4, 1998, by and
between AMB Property, L.P. and CBDV Investors, L.L.C. (WOCAC Portfolio)
H-1
EXHIBIT I
SCHEDULE OF CERTAIN AGREEMENTS CONTAINING
LIMITATIONS ON GENERAL PARTNERS GENERAL AUTHORITY
1. Contribution Agreements, dated March 30, 1998, by and among AMB
Property, L.P. and the other parties named therein. (Xxxxxxxxxx
Portfolio)
2. AMB Property, L.P., First Amendment to Amended and Restated Agreement
of Limited Partnership, dated as of March 30, 1998.
3. Contribution Agreement, dated March 31, 1998, by and among AMB
Property, L.P. and Xxxxx Xxxxxxxxxxx, Xxxxxxx X. Xxxxxxx, Xxxx Xxxxxxxx
and Xxxxx Xxxxxx.
4. AMB Property, L.P., Second Amendment to Amended and Restated Agreement
of Limited Partnership, dated as of March 31, 1998.
5. Contribution Agreement, dated June 4, 1998 by and among AMB Property,
L.P. and the other parties named therein. (Southfield Portfolio)
6. AMB Property, L.P. Third Amendment to Amended and Restated Agreement of
Limited Partnership, dated as of June 4, 1998.
7. Contribution Agreement, dated May 21, 1998, by and among AMB Property,
L.P. and the other parties named therein. (Alsip Industrial Portfolio)
8. AMB Property, L.P. Fourth Amendment to Amended and Restated Agreement
of Limited Partnership, dated as of June 30, 1998.
9. Amended and Restated Contribution Agreement dated as of August 6, 1998,
by and among AMB Property, L.P., AMB Property Corporation and the other
parties named therein. (Willow Park Portfolio)
10. AMB Property, L.P. First Amendment to Second Amended and Restated
Agreement of Limited Partnership, dated as of September 24, 1998.
11. Portfolio Contribution Agreement, dated as of November 17, 1998, by and
among AMB Property, L.P., AMB Property Corporation and the individuals
named therein, as amended by the First Amendment, dated as of February
1, 1999, and the Second Amendment, dated as of April 30, 1999. (Manekin
Portfolio)
12. Purchase and Sale Agreement, dated as of December 4, 1998, by and
between AMB Property, L.P. and CBDV Investors, L.L.C. (WOCAC Portfolio)
13. AMB Property, L.P. Fourth Amendment to Third Amended and Restated
Agreement of Limited Partnership, dated as of February 1, 1999.
I-1
14. AMB Property, L.P. Fifth Amendment to Third Amended and Restated
Agreement of Limited Partnership, dated as of April 30, 1999.
15. AMB Property, L.P. Sixth Amendment to Third Amended and Restated
Agreement of Limited Partnership, dated as of May 21, 1999.
16. AMB Property, L.P. Ninth Amendment to Third Amended and Restated
Agreement of Limited Partnership, dated as of September 30, 1999.
17. AMB Property, L.P. Fourth Amended and Restated Agreement of Limited
Partnership, dated as of August 10, 2000.
18. AMB Property, L.P. First Amendment to Fourth Amended and Restated
Agreement of Limited Partnership dated as of November 7, 2000.
19. Assignment and Assumption Agreement dated as of December 31, 2000 by
and between the AMB Property Corporation and AMB Property, L.P.
20. AMB Property, L.P. Fifth Amended and Restated Agreement of Limited
Partnership, dated as of September 21, 2001.
21. Assignment and Assumption Agreement dated as of September 21, 2001 by
and between the AMB Property Corporation and AMB Property, L.P.
22. AMB Property, L.P. First Amendment to Fifth Amended and Restated
Agreement of Limited Partnership dated as of January 1, 2002.
23. AMB Property, L.P. Sixth Amended and Restated Agreement of Limited
Partnership, dated as of April 17, 2002.
24. Assignment and Assumption Agreement dated as of April 17, 2002 by and
between AMB Property Corporation and AMB Property, L.P.
25. AMB Property, L.P. First Amendment to Sixth Amended and Restated
Agreement of Limited Partnership dated as of October 30, 2002.
26. AMB Property, L.P. Seventh Amended and Restated Agreement of Limited
Partnership, dated as of June 23, 2003.
27. Assignment and Assumption Agreement dated as of June 23, 2003 by and
between AMB Property Corporation and AMB Property, L.P.
28. AMB Property, L.P. Eighth Amended and Restated Agreement of Limited
Partnership, dated as of July 28, 2003.
29. Assignment and Assumption Agreement dated as of July 28, 2003 by and
between AMB Property Corporation and AMB Property, L.P.
30. AMB Property, L.P. Ninth Amended and Restated Agreement of Limited
Partnership, dated as of November 25, 2003.
I-2
31. Assignment and Assumption Agreement dated as of November 25, 2003 by
and between AMB Property Corporation and AMB Property, L.P.
I-3
EXHIBIT J
RESTRICTIONS ON OWNERSHIP AND TRANSFER TO PRESERVE TAX BENEFIT
(a) Definitions. for the purposes of this Exhibit J, the following
terms shall have the following meanings:
"Charitable Beneficiary" shall mean one or more
beneficiaries of a Trust, as determined pursuant to subsection
(c)(vi), each of which shall be an organization described in
Sections 170(b)(1)(A), 170(c)(2) and 501(c)(3) of the Code.
"Code" shall mean the Internal Revenue Code of 1986,
as amended.
"Constructive Ownership" shall mean ownership of
Partnership Units by a Person who is or would be treated as an
owner of such Partnership Units either actually or
constructively through the application of Section 318 of the
Code, as modified by Section 856(d)(5) of the Code. The terms
"Constructive Owner," "Constructively Owns" and
"Constructively Owned" shall have the correlative meanings.
"Exempted Person" shall mean any Person exempted from
time to time by the General Partner in its sole and absolute
discretion.
"Market Price" shall mean the market price of the
Partnership Units on the relevant date as determined in good
faith by the General Partner; provided, however, if the
General Partner has outstanding shares of capital stock which
correspond to such Partnership Units, the Market Price of each
such Partnership Unit shall be equal to the Value of a share
of such capital stock, subject to adjustment if the right to
exchange such Partnership Units for such stock is other than
one-to-one.
"Ownership Limit" shall mean 24.9% of the capital or
profits interests of the Partnership.
"Person" shall mean an individual, corporation,
partnership, limited liability company, estate, trust
(including a trust qualified under Section 401(a) or
501(c)(17) of the Code), a portion of a trust permanently set
aside for or to be used exclusively for the purposes described
in Section 642(c) of the Code, association, private foundation
within the meaning of Section 509(a) of the Code, joint stock
company or other entity.
"Purported Beneficial Transferee" shall mean, with
respect to any purported Transfer (or other event) which
results in a transfer to a Trust, as provided in subsection
(b)(ii), the Purported Record Transferee, unless the Purported
Record Transferee would have acquired or owned Partnership
Units for another Person who is the beneficial transferee or
owner of such Partnership Units, in which case the Purported
Beneficial Transferee shall be such Person.
J-1
"Purported Record Transferee" shall mean, with
respect to any purported Transfer (or other event) which
results in a transfer to a Trust, as provided in subsection
(b)(ii), the holder of the Partnership Units as set forth or
to be set forth in Exhibit A to the Partnership Agreement, and
any Assignee of such Partnership Units, if such Transfer or
ownership had been valid under subsection (b)(i).
"Restriction Termination Date" shall mean the first
day after the date hereof on which the General Partner
determines, in its sole and absolute discretion, that
compliance with subsection (b)(i) is no longer necessary or
advisable.
"Transfer" shall mean any sale, transfer, gift,
assignment, devise or other disposition of Partnership Units,
(including (i) the granting of any option or entering into any
agreement for the sale, transfer or other disposition of
Partnership Units or (ii) the sale, transfer, assignment or
other disposition of any securities (or rights convertible
into or exchangeable for Partnership Units), whether voluntary
or involuntary, whether such transfer has occurred of record
or beneficially or Constructively (including but not limited
to transfers of interests in other entities which results in
changes in Constructive Ownership of Partnership Units), and
whether such transfer has occurred by operation of law or
otherwise.
"Trust" shall mean each of the trusts provided for in
subsection (c).
"Trustee" shall mean any Person unaffiliated with the
Partnership, or a Purported Beneficial Transferee, or a
Purported Record Transferee, that is appointed by the
Partnership to serve as trustee of a Trust.
Capitalized terms used and not defined herein shall have the meanings ascribed
to them in the Fourth Amended and Restated Agreement of Limited Partnership of
AMB Property, L.P. (the "Partnership Agreement), as such agreement may be
amended from time to time. All references to "Section" refer to the Partnership
Agreement.
(b) Restriction on Ownership and Transfers.
(i) Prior to the Restriction Termination Date, no Person,
other than an Exempted Person, shall at any time Constructively Own Partnership
Units in excess of the Ownership Limit if the representations contained in
Section 3.4.D are not at such time true and correct.
(ii) If, prior to the Restriction Termination Date, any
Transfer or other event occurs that, if effective, would result in any Person
Constructively Owning Partnership Units in violation of subsection (b)(i), (1)
then that number of Partnership Units that otherwise would cause such Person to
violate subsection (b)(i) (rounded up to the nearest whole Partnership Unit)
shall be automatically transferred (provided such Transfer is not in violation
of the restrictions on transfer set forth in the Partnership Agreement, except
to the extent the General Partner waives such restrictions) to a Trust for the
benefit of a Charitable Beneficiary, as described in subsection (c), effective
as of the close of business on the business day prior to the date of such
Transfer or other event, and such Purported Beneficial Transferee shall
thereafter have no rights in such Partnership Units or (2) if, for any reason,
the transfer to the Trust described in clause (1) of this sentence is not
J-2
automatically effective as provided therein to prevent any Person from
Constructively Owning Partnership Units in violation of subsection (b)(i), then
the Transfer of that number of Partnership Units that otherwise would cause any
Person to violate subsection (b)(i) shall be void ab initio, and the Purported
Beneficial Transferee shall have no rights in such Partnership Units.
(c) Transfers of Partnership Units in Trust.
(i) Upon any purported Transfer or other event described
in subsection (b)(ii), such Partnership Units shall be deemed to have been
transferred to the Trustee in his capacity as trustee of a Trust for the
exclusive benefit of one or more Charitable Beneficiaries. Such transfer to the
Trustee shall be deemed to be effective as of the close of business on the
business day prior to the purported Transfer or other event that results in a
transfer to the Trust pursuant to subsection (b)(ii). The Trustee shall be
appointed by the Partnership and shall be a Person unaffiliated with the
Partnership, any Purported Beneficial Transferee, or any Purported Record
Transferee. Each Charitable Beneficiary shall be designated by the Partnership
as provided in subsection (c)(vi).
(ii) Partnership Units held by the Trustee shall be issued
and outstanding Partnership Units of the Partnership. The Purported Beneficial
Transferee or Purported Record Transferee shall have no rights in the
Partnership Units held by the Trustee. The Purported Beneficial Transferee or
Purported Record Transferee shall not benefit economically from ownership of any
Partnership Units held in trust by the Trustee, shall have no rights to
distributions or allocations with respect to Partnership Units held in the Trust
and shall not possess any rights to vote or other rights attributable to the
Partnership Units held in the Trust.
(iii) The Trustee shall have all voting rights and rights
to distributions and allocations with respect to Partnership Units held in the
Trust, which rights shall be exercised for the exclusive benefit of the
Charitable Beneficiary. Any distribution paid prior to the discovery by the
Partnership that Partnership Units have been transferred to the Trustee shall be
paid to the Trustee upon demand, and any distribution with respect to such
Partnership Units shall be paid when due to the Trustee. Any distributions so
paid over to the Trustee shall be held in trust for the Charitable Beneficiary.
The Purported Record Transferee and Purported Beneficial
Transferee shall have no voting rights with respect to the Partnership Units
held in the Trust and, subject to Delaware law, effective as of the date the
Partnership Units has been transferred to the Trustee, the Trustee shall have
the authority (at the Trustee's sole discretion) (i) to rescind as void any vote
cast by a Purported Record Transferee with respect to such Partnership Units
prior to the discovery by the Partnership that the Partnership Units has been
transferred to the Trustee and (ii) to recast such vote in accordance with the
desires of the Trustee acting for the benefit of the Charitable Beneficiary;
provided, however, that if the Partnership has already taken irreversible
action, then the Trustee shall not have the authority to rescind and recast such
vote. Notwithstanding any other provision of this Exhibit J to the contrary,
until the Partnership has received notification that the Partnership Units have
been transferred into a Trust, the Partnership shall be entitled to rely on its
Partnership Unit transfer and other unitholder records for purposes of preparing
Exhibit A to the Partnership Agreement, lists of unitholders entitled to vote at
meetings, and otherwise conducting votes of Partners.
J-3
(iv) Within 20 days of receiving notice from the
Partnership that Partnership Units have been transferred to the Trust, the
Trustee of the Trust shall, in accordance with the terms of (and subject to the
limitations contained in) the Partnership Agreement, sell the Partnership Units
held in the Trust to a Person, designated by the Trustee, whose ownership of the
Partnership Units will not violate the ownership limitations set forth in
subsection (b)(i). Upon such sale, the interest of the Charitable Beneficiary in
the Partnership Units sold shall terminate and the Trustee shall distribute the
net proceeds of the sale to the Purported Record Transferee and to the
Charitable Beneficiary as provided in this subsection (c)(iv). The Purported
Record Transferee shall receive the lesser of (1) the price paid by the
Purported Record Transferee for the Partnership Units in the transaction that
resulted in such transfer to the Trust (or, if the event which resulted in the
transfer to the Trust did not involve a purchase of such Partnership Units at
Market Price, the Market Price of such Partnership Units on the day of the event
which resulted in the transfer of such Partnership Units to the Trust) and (2)
the price per Partnership Unit received by the Trustee (net of any commissions
and other expenses of sale) from the sale or other disposition of the
Partnership Units held in the Trust. Any net sales proceeds in excess of the
amount payable to the Purported Record Transferee shall be immediately paid to
the Charitable Beneficiary together with any distributions thereon. If, prior to
the discovery by the Partnership that Partnership Units have been transferred to
the Trustee, such Partnership Units are sold by a Purported Record Transferee
then (i) such Partnership Units shall be deemed to have been sold on behalf of
the Trust and (ii) to the extent that the Purported Record Transferee received
an amount for such Partnership Units that exceeds the amount that such Purported
Record Transferee was entitled to receive pursuant to this subsection (c)(iv),
such excess shall be paid to the Trustee upon demand. The expenses described in
item (2) above shall include any expenses of administering the Trust, any
transfer of Partnership Units thereto or disposition of Partnership Units
thereby, which shall be allocated equitably among the Partnership Units which
are transferred to the Trust.
(v) Partnership Units transferred to the Trustee shall be
deemed to have been offered for sale to the Partnership, or its designee, at a
price per Partnership Unit equal to the lesser of (i) the price paid by the
Purported Record Transferee for the Partnership Units in the transaction that
resulted in such transfer to the Trust (or, if the event which resulted in the
transfer to the Trust did not involve a purchase of such Partnership Units at
Market Price, the Market Price of such Partnership Units on the day of the event
which resulted in the transfer of such Partnership Units to the Trust) and (ii)
the Market Price on the date the Partnership, or its designee, accepts such
offer. The Partnership shall have the right to accept such offer until the
Trustee has sold the Partnership Units held in the Trust pursuant to subsection
(c)(iv). Upon such a sale to the Partnership, the interest of the Charitable
Beneficiary in the Partnership Units sold shall terminate and the Trustee shall
distribute the net proceeds of the sale to the Purported Record Transferee and
any distributions held by the Trustee with respect to such Partnership Units
shall thereupon be paid to the Charitable Beneficiary.
(vi) By written notice to the Trustee, the Partnership
shall designate one or more nonprofit organizations to be the Charitable
Beneficiary of the interest in the Trust such that the Partnership Units held in
the Trust would not violate the restrictions set forth in subsection (b)(i) in
the hands of such Charitable Beneficiary.
(d) Remedies For Breach. If the General Partner shall at any time
determine in good faith that a Transfer or other event has taken place in
violation of subsection (b) or that a Person intends to acquire, has attempted
to acquire or may acquire beneficial ownership (determined
J-4
without reference to any rules of attribution) or Constructive Ownership of any
Partnership Units of the Partnership in violation of subsection (b), the General
Partner shall take such action as it deems advisable to refuse to give effect or
to prevent such Transfer, including, but not limited to, causing the Partnership
to redeem Partnership Units, refusing to give effect to such Transfer on the
books of the Partnership or instituting proceedings to enjoin such Transfer;
provided, however, that any Transfers (or, in the case of events other than a
Transfer, ownership or Constructive Ownership) in violation of subsection
(b)(i), shall automatically result in the transfer to a Trust as described in
subsection (b)(ii).
(e) Notice of Restricted Transfer. Any Person who acquires or
attempts to acquire or own Partnership Units in violation of subsection (b), or
any Person who is a Purported Beneficial Transferee such that an automatic
transfer to a Trust results under subsection (b)(ii), shall immediately give
written notice to the Partnership of such event and shall provide to the
Partnership such other information as the Partnership may request in order to
determine the effect, if any, of such Transfer or attempted Transfer on such
Person's compliance with subsection (b)(i).
(f) Owners Required To Provide Information. Prior to the
Restriction Termination Date each Person who is a beneficial owner or
Constructive Owner of Partnership Units and each Person who is holding
Partnership Units for a beneficial owner or Constructive Owner shall provide to
the Partnership such information that the Partnership may request, in good
faith, in order to determine the Partnership's status as a partnership (as
opposed to a corporation) or the General Partner's status as a REIT for federal
income tax purposes.
(g) Remedies Not Limited. Nothing contained in this Exhibit J
shall limit the authority of the General Partner to take such other action as it
deems necessary or advisable to protect the Partnership and the interests of its
Partners by preservation of the Partnership's status as a partnership (as
opposed to a corporation) or the General Partner's status as a REIT for federal
income tax purposes.
(h) Ambiguity. In the case of an ambiguity in the application of
any of the provisions of this Exhibit J, including any definition contained in
subsection (a), the General Partner shall have the power to determine the
application of the provisions of this Exhibit J with respect to any situation
based on the facts known to it. In the event that a provision of this Exhibit J
requires an action by the General Partner and Exhibit J fails to provide
specific guidance with respect to such action, the General Partner shall have
the power to determine the action to be taken so long as such action is not
contrary to the provisions of Exhibit J. Absent a decision to the contrary by
the General Partner (which the General Partner may make in its sole and absolute
discretion), if a Person would have (but for the remedies set forth in
subsection (b)) acquired Constructive Ownership of Partnership Units in
violation of subsection (b)(i), such remedies (as applicable) shall apply first
to the Partnership Units which, but for such remedies, would have been actually
owned by such Person, and second to Partnership Units which, but for such
remedies, would have been Constructively Owned (but not actually owned) by such
Person, pro rata among the Persons who actually own such Partnership Units based
upon the relative number of the Partnership Units held by each such Person.
J-5
