EXHIBIT 2.1
FIRST AMENDMENT TO
AGREEMENT AND PLAN OF MERGER
THIS FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER, dated May 11,
2004 (this "Amendment"), among HRPT PROPERTIES TRUST, a Maryland real estate
investment trust ("Parent"), HWP LP ACQUISITION LLC, a Delaware limited
liability company and a wholly-owned subsidiary of Parent ("Purchaser"),
HALLWOOD REALTY PARTNERS, L.P., a Delaware limited partnership (the
"Partnership") and HALLWOOD REALTY, LLC, a Delaware limited liability company
and the general partner (the "General Partner") of the Partnership amends that
certain Agreement And Plan Of Merger, dated as of April 16, 2004 (the "Original
Agreement"), among Parent, Purchaser, the Partnership and the General Partner.
Capitalized terms used in this amendment and not otherwise defined shall have
the meanings given in the Original Agreement.
RECITALS:
The undersigned, being all of the parties to the Original Agreement,
have agreed to amend the Original Agreement in order to, inter alia, accurately
reflect the parties' agreement as to the consideration payable in respect of the
Merger and the calculation of the Working Capital Adjustment, in each case as
set forth in this Amendment.
NOW, THEREFORE, it is agreed:
ARTICLE 1
AMENDMENTS TO THE ORIGINAL AGREEMENT
1.01 Section 2.01(b)(i) of the Original Agreement is hereby deleted in
its entirety and replaced with the following:
(i) Each Unit issued and outstanding immediately prior to the
Effective Time shall be converted into the right to receive an amount in cash
(the "Merger Price") equal to the quotient which results by dividing:
(x) the sum of (1) 91.5% of the Gross Merger Consideration, plus
(2) the aggregate exercise price of all Unit Options
outstanding as of April 16, 2004, by
(y) the sum of (1) the total number of Units outstanding
immediately prior to the Effective Time, plus (2) the total
number of Units for which Unit Options outstanding immediately
prior to the Effective Time would be exercisable.
As used herein, "Gross Merger Consideration" means an amount equal to two
hundred fifty million dollars ($250,000,000), increased or decreased, as the
case may be, by the Working Capital Adjustment (but not decreased to less than
two hundred forty-five million dollars ($245,000,000); any Working Capital
Adjustment which would result in a decrease in excess of five million dollars
($5,000,000) will be accounted for in the Purchase Agreement). The Merger Price
for each Unit shall be payable upon surrender and exchange of the Certificate
representing such Unit, shall not bear interest and shall be reduced by any
withholding (as provided in Section 2.02(g)).
1.02 Section 2.02(a) of the Original Agreement is hereby deleted in its
entirety and replaced with the following:
(a) Paying Agent. Prior to the Effective Time, Parent shall select a
bank or trust company reasonably acceptable to the Partnership to act as paying
agent (the "Paying Agent") for the payment of the Merger Price upon surrender of
Certificates. The Purchaser shall, and Parent shall cause the Purchaser to,
deposit with the Paying Agent prior to the Effective Time, an amount in cash
which, together with the Deposit, is equal to the aggregate Merger Price payable
to holders of all the Units converted pursuant to Section 2.01(b) (other than
the Units purchased by the Successor GP pursuant to the Purchase Agreement)(such
cash, inclusive of the Deposit, being hereinafter referred to as the "Exchange
Fund"). The expenses of the Paying Agent shall not be paid from the Exchange
Fund, but shall be paid directly by the Purchaser.
1.03 Section 5.01(a)(vii) of the Original Agreement is hereby deleted
in its entirety and replaced with the following:
(vii) encumber, sell, lease (as lessor, including renewal or extension
of any Partnership Lease), transfer, assign, license, convey or otherwise
dispose of (or contract to dispose of) or subject to any Lien (or contract to
subject to any Lien), any Material Contract or Partnership Real Property, or
amend or terminate any such lease or license, except matters set forth in
Section 5.01 of the Partnership Disclosure Letter; provided, however, that the
Partnership shall actively attempt to lease vacant Partnership Real Property and
may make all necessary tenant improvements and capital expenditures required
under the Partnership Leases as in effect on the date of this Agreement
1.04 The following is hereby inserted after Section 8.01(g) of the
Original Agreement:
This Agreement shall be terminated and the merger abandoned if the
Purchase Agreement is terminated in accordance with the provisions of
Section 6.01(c) thereof.
1.05 The phrase "by either the Partnership or Parent or Purchaser" in
the first sentence of Section 8.02 of the Original Agreement is deleted and
nothing substituted therefor. The definition of "Net Working Capital" in Section
9.03 of the Original Agreement is hereby deleted in its entirety and replaced
with the following:
"Net Working Capital" means the amount equal to:
(a) the amount by which (i) "cash and cash equivalents," "accounts
receivable," "receivable from affiliate, net," "escrow deposits held by
lenders," "prepaid expenses and other assets," and "effective rent receivable,"
(provided that any "accounts receivable" in excess of thirty (30) days past due
shall be excluded) exceed (ii) "accounts payable and accrued expenses," "payable
to affiliates," and "prepaid rent, security deposits and other," all in each
case as reflected on the Partnership's consolidated balance sheet and determined
in accordance with GAAP by a national, independent accounting firm to be agreed
upon by the Partnership and Parent ("Accountant") as of the close of business on
the last day of the calendar month immediately preceding the Closing Date (the
"Determination Date"), minus
(b) the sum of (i) Transaction Costs, (ii) estimated Taxes related to
Tax Returns described in Section 6.15(a) hereof, (iii) all unaccrued real estate
brokerage fees, "tenant inducements", "free rent" and other amounts due from the
landlord under any Partnership Lease, (iv) the estimated cost required to remedy
Rent Defects calculated as set forth in Section 6.03(c)(ii), (v) the estimated
cost required to remedy or remove any Defects (other than Rent Defects), Title
Defects or Survey Defects pursuant to Section 6.03(c), in each case to the
extent the Partnership or any Subsidiary has not then remedied or removed such
Defects, Title Defects or Survey Defects and paid all costs in connection
therewith prior to the Determination Date, and (vi) the aggregate exercise price
of all Unit Options exercised after April 16, 2004, in each case unless
reflected on the books of the Partnership on or prior to the Determination Date
as "accounts payable and accrued expenses" or "payable to affiliates",
provided in making the determination under (1) paragraph (b) above, the
amount to be deducted for unaccrued real estate brokerage fees, "tenant
inducements", "free rent" and other amounts due from the landlord under any
Partnership Lease shall be $4,573,472 and (2) paragraph (a) above, any amounts
expended or incurred for real estate brokerage fees, "tenant inducements", "free
rent" and other amounts due from the landlord under any Partnership Lease (A)
entered into after April 16, 2004 with the prior written consent of Parent, to
the extent such amounts exceed, in the aggregate, $2,829,624, such excess shall
not decrease "cash and cash equivalents" if then paid and shall not increase
"accounts payable and accrued expenses" or "payable to affiliates" if incurred
but not then paid and (B) entered into prior to April 16, 2004 shall not
decrease "cash and cash equivalents", if then paid, and shall not increase
"accounts payable and accrued expenses" or "payable to affiliates" if incurred
but not then paid, until such amounts paid or incurred exceed, in the aggregate,
$4,573,472.
Net Working Capital shall be determined by the Accountant as of the
close of business on the business day immediately prior to the Closing Date and
in a manner consistent with the schedule set forth in Section 9.03 of the
Partnership Disclosure Letter.
1.07 The definition of "Working Capital Adjustment" in Section 9.03 of
the Original Agreement is hereby deleted in its entirety and replaced with the
following:
"Working Capital Adjustment" means, (i) if Net Indebtedness is greater
than $165,185,000, the negative amount which results by subtracting Net
Indebtedness from $165,185,000, or (ii) if Net Indebtedness is less than
$160,185,000, the positive amount which results by subtracting Net Indebtedness
from $160,185,000. The Working Capital Adjustment shall be determined by the
Accountant as of the close of business on the business day immediately preceding
the Closing Date and in a manner consistent with the schedule set forth in
Section 9.03 of the Partnership Disclosure Letter.
1.08 Section 9.02 of the Original Agreement is hereby deleted in its
entirety and replaced with the following:
9.02 Notices. All notices, requests, claims, demands and other
communications under this Agreement shall be in writing and shall be deemed
given upon receipt (or upon the next succeeding business day if received after
5:00 p.m. local time on a business day or if received on a Saturday, Sunday or
United States holiday) by the parties at the following addresses or facsimile
numbers (or at such other address for a party as shall be specified by like
notice):
(a) if to Parent or Purchaser, to:
HRPT Properties Trust
000 Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxx X. Xxxxx
Facsimile: (000) 000-0000
with a copy to:
Xxxxxxxx & Worcester LLP
Xxx Xxxx Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxx
Facsimile: (000) 000-0000
(b) if to the Partnership, to:
Hallwood Realty, LLC
0000 Xxxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
with a copy to:
Jenkens & Xxxxxxxxx, a Professional Corporation
0000 Xxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: W. Xxxx Xxxxxx
Facsimile: (000) 000-0000
1.09 The following clause (i) is hereby added to Section 9.04 of the
Original Agreement:
(i) Any action, notice, request, claim, demand or other communication
which under the terms of this Agreement is required to be taken or given, as
applicable, on a Saturday, Sunday or United States holiday, shall be deemed
timely provided that such action, notice, request, claim, demand or other
communication is taken or given, as applicable, on the next succeeding business
day.
1.10 In all other respects, the Original Agreement shall continue in
full force and unmodified.
ARTICLE 2
GENERAL PROVISIONS
2.01 Severability. If any term or other provision of this Amendment or
the Original Agreement as amended by this Amendment is invalid, illegal or
incapable of being enforced by any rule or Law, or public policy, all other
terms and provisions of this Amendment or the Original Agreement, as amended by
this Amendment, as applicable, shall nevertheless remain in full force and
effect so long as the economic and legal substance of the Transactions is not
affected in any manner materially adverse to any party. Upon such determination
that any term or other provision is invalid, illegal or incapable of being
enforced, the parties hereto shall negotiate in good faith to modify this
Amendment so as to effect the original intent of the parties as closely as
possible in an acceptable manner to the end that the Transactions are fulfilled
to the extent possible.
2.02 Counterparts. This Amendment may be executed in one or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other parties.
2.03 Entire Agreement; No Third-Party Beneficiaries. The Original
Agreement, as amended by this Amendment, taken together with the Partnership
Disclosure Letter all schedules and the Purchase Agreement, (a) constitutes the
entire agreement, and supersedes all prior agreements and understandings, both
written and oral, among the parties with respect to the Transactions and (b)
except to the extent set forth in the Original Agreement, as amended by this
Amendment, is not intended to confer upon any person other than the parties
hereto any rights, remedies, obligations or liabilities.
2.04 Governing Law. This Amendment shall be governed by, and construed
in accordance with, the laws of the State of Delaware, regardless of the laws
that might otherwise govern under applicable principles of conflicts of laws
thereof.
2.05 Nonliability of Trustees. THE DECLARATION OF TRUST ESTABLISHING
THE PARENT, A COPY OF WHICH, TOGETHER WITH ALL AMENDMENTS THERETO (THE
"DECLARATION"), IS DULY FILED WITH THE DEPARTMENT OF ASSESSMENTS AND TAXATION OF
THE STATE OF MARYLAND, PROVIDES THAT THE NAME "HRPT PROPERTIES TRUST" REFERS TO
THE TRUSTEES UNDER THE DECLARATION COLLECTIVELY AS TRUSTEES, BUT NOT
INDIVIDUALLY OR PERSONALLY, AND THAT NO TRUSTEE, OFFICER, SHAREHOLDER, EMPLOYEE
OR AGENT OF THE PARENT SHALL BE HELD TO ANY PERSONAL LIABILITY, JOINTLY OR
SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, THE PARENT. ALL PERSONS
DEALING WITH THE PARENT, IN ANY WAY, SHALL LOOK ONLY TO THE ASSETS OF THE PARENT
FOR THE PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY OBLIGATION.
IN WITNESS WHEREOF, Parent, Purchaser and the Partnership have duly
executed this Amendment, all as of the date first written above.
HRPT PROPERTIES TRUST
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: Executive Vice President
HWP LP ACQUISITION LLC
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: Executive Vice President
HALLWOOD REALTY PARTNERS, L.P.
By: Hallwood Realty, LLC, its general
partner
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: Executive Vice President
HALLWOOD REALTY, LLC
By: /s/ Xxxx X. Xxxxxxx
---------------------------------------
Name: Xxxx X. Xxxxxxx
Title: Executive Vice President
