Exhibit 10.4
SUPPLEMENT TO THE AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
RECKSON OPERATING PARTNERSHIP, L.P.
ESTABLISHING
SERIES D PREFERRED UNITS
OF
LIMITED PARTNERSHIP INTEREST
In accordance with Sections 4.2 and 14.1 B(3) of the Amended and
Restated Agreement of Limited Partnership, dated as of June 2, 1995, as
amended on December 6, 1995 and on April 13, 1998 (the "Partnership
Agreement"), and Section 38 of the Contribution Agreement, dated as of March
31, 1998 among Reckson Operating Partnership, L.P. and each of the
Contributing Parties listed on Schedule 1 thereto, the Partnership Agreement
is hereby supplemented to establish a series of 6,000 preferred units (subject
to increase as set forth below) of limited partnership interest of Reckson
Operating Partnership, L.P. (the "Company") which shall be designated "Series
D Preferred Units" having the rights, preferences, powers, privileges and
restrictions, qualifications and limitations granted to or imposed upon the
Series D Preferred Units (referred to hereinafter sometimes as the
"Designations") as set forth below and which shall be issued to the parties
and in the amounts set forth on Schedule A hereto. The Company has previously
issued (x) the Series B Preferred Units pursuant to the Supplement to the
Amended and Restated Agreement of Limited Partnership Establishing Series B
Preferred Units of Limited Partnership Interest, dated as of March 31, 1998
("Series B Preferred Units") and (y) the Series C Preferred Units pursuant to
the Supplement to the Amended and Restated Agreement of Limited Partnership
Establishing Series C Preferred Units of Limited Partnership Interest, dated
as of March 31, 1998 ("Series C Preferred Units") (the Series B Preferred
Units, the Series C Preferred Units and the Series D Preferred Units shall be
collectively referred to herein as the "Preferred Units"). Subject to the
limitations set forth below, the Company may issue other additional series of
Preferred Units whose rights, preferences, powers, privileges and
restrictions, qualifications and limitations regarding Distributions (as
hereinafter defined) and/or liquidation are either subordinate to, or pari
passu with, the Designations of the Series D Preferred Units. Capitalized
terms used and not otherwise defined herein shall have the meanings set forth
in the Partnership Agreement.
1. STATED VALUE. The stated value of the Series D Preferred Units
shall be one thousand dollars ($1,000.00) per unit (the "Stated Value").
2. DISTRIBUTIONS.
(a) Subject to Section 2(b) below, commencing from the date of
initial issuance of Series D Preferred Units (the "Date of Issuance"),
distributions (the "Distributions") on each Series D Preferred Unit shall be
payable in arrears quarterly, in an amount equal to the greater of: (i) $17.50
(as such amount may be adjusted pursuant to Section 2(c) hereof) or (ii) the
quarterly distribution attributable to each Series D Preferred Unit if such
unit had been converted into Common Units (as hereinafter defined), pursuant
to Section 4 hereof, except that the Preferred Conversion Factor to be
utilized for this purpose shall be calculated using a Conversion Price of
$24.78 (subject to adjustment as provided in Section 4(iv) hereof) in lieu of
the Conversion Price set forth in Section 4(iii), subject to a maximum
increase as a result of the provisions of this Section 2(a)(ii), for any one
fiscal year of the Company, of 5% of the Distributions on the Series D
Preferred Units for the immediately preceding fiscal year of the Company.
Subsequent to any such fiscal year, any increase that would have been made to
the Distribution in such fiscal year, but was not made due to the foregoing 5%
limit, shall be made up to an amount that does not exceed a 5% increase over
the distribution on the Series D Preferred Units during the immediately
preceding fiscal year of the Company. In each fiscal year thereafter, the
excess, if any, over the 5% limit applicable to the immediately preceding
fiscal year shall cumulate with the respective excesses, if any, over the 5%
limit applicable to other fiscal years prior to such immediately preceding
fiscal year and shall be carried forward and increase the then current
Distribution, but in no event shall any such increase exceed a 5% increase
over the Distribution on the Series D Preferred Units for the immediately
preceding fiscal year. Notwithstanding anything appearing to the contrary in
this Section 2(a), the Distribution to be made on Series D Preferred Units to
any holder thereof on the Distribution Payment Date (as defined below)
immediately following the Date of Issuance shall be made based upon the number
of days during the period preceding that initial Distribution Payment Date
that Series D Preferred Units were outstanding. The Distributions shall be
declared and payable quarterly in arrears on or about January 31, April 30,
July 31 and October 31 of each year, or, if not a business day, the next
succeeding business day, commencing July 31, 1998 (a "Distribution Payment
Date"). If on any Distribution Payment Date the Company shall not be permitted
under Delaware law to pay all or a portion of any such declared Distributions,
the Company shall take such action as may be lawfully permitted in order to
enable the Company to the extent permitted by Delaware law, lawfully to pay
such Distributions. Distributions shall be cumulative from the Date of
Issuance, whether or not in any Distribution period such Distribution shall be
declared or there shall be funds of the Company legally available for payment
of such Distributions. No Distributions shall be declared or paid on any class
of Common Units or any other class or series of Preferred Units, other than
Distributions declared and paid on the Series A Preferred Units, the Series B
Preferred Units, the Series C Preferred Units and, subject to the limitations
set forth in Section 7(b)(ii), any other series of Preferred Units which, by
the terms of such series are pari passu with the Series D Preferred Units with
respect to payment of distributions and distribution of assets upon
liquidation (such Preferred Units hereinafter referred to as "Qualifying
Preferred Units"), until all Distributions, if any, due and legally payable on
the Series D Preferred Units have been paid to the holders of such units. The
record date for the payment of Distributions on the Series D Preferred Units
on any Distribution Payment Date shall be the day immediately prior to such
Distribution Payment Date.
(b) Reduction of Distribution Amount Due to Pre-Payment Premiums.
Notwithstanding the provisions of Section 2(a), during any period that those
certain mortgage loans between Xxxxxxxx Associates II and M&T Real Estate,
Inc. dated March 27, 1997, (the "M&T Note") and between Xxxxxxxx Associates VI
and Xxxxxxx Xxxxxxxx Capital Corp., dated December 19, 1995 (the "Xxxxxxx
Hastings Note," and together with the M&T Note, the "Mortgage Loans"), remain
subject to the prepayment premium or prepayment penalty set forth in Exhibit A
to Rider A to the M&T Note or Section 1 of the Addendum to the Xxxxxxx
Xxxxxxxx Note (the "Pre-Payment Premiums"), the quarterly Distribution payable
on each Series D Preferred Unit shall be reduced to $15.625 (the "Reduced
Rate"); provided, however (i) that the Reduced Rate shall only apply to such
Preferred Units, having an aggregate stated value of $44,667,000 or less, as
may be designated in writing by Xxxxx X. Xxxxxxxx on behalf of the holders of
the Preferred Units, and the Reduced Rate shall not be applicable to any other
Preferred Units, and (ii) in no event shall the Reduced Rate be applicable, or
the provisions of this Section 2(b) be effective, subsequent to April 1, 2007.
To the extent Xxxxx X. Xxxxxxxx does not make such designation in writing,
Distributions with respect to each Series B, Series C and Series D Unit shall
be reduced equally. If there shall be less than an aggregate of $44,667,000 in
stated value of Preferred Units outstanding while any Pre-Payment Premiums
remain payable (or while any Pre-Payment Premiums are treated as continuing as
provided in this Section 2(b) after having been paid by the Company) the
Reduced Rate shall be further reduced so as to result in an annual aggregate
reduction in Distributions in respect of Preferred Units of $335,000 per annum
(or a proportionately lesser amount, as described below, if only one of the
Mortgage Loans remains outstanding and subject to a Prepayment Premium) from
the annual aggregate distributions that would otherwise have been payable
pursuant to Section 2(a) hereof. If the Mortgage Loans mature or may be repaid
prior to their maturity without the incurrence of any Pre-Payment Premium, or
if the holder of any Preferred Units deposits with the Company an amount of
cash equal to the then current Pre-Payment Premium with the Company upon five
(5) days notice by such holder to the Company of such holder's intention to
deposit such amount, then thereafter the Distribution payable in respect of
Preferred Units shall be as provided in Section 2(a) herein. If the Company
repays one or both of the Mortgage Loans and, in connection therewith, incurs
a Pre-Payment Premium, the reduced Distribution payable with respect to the
Preferred Units provided for in this Section 2(b) shall continue in effect as
if the Mortgage Loans remained outstanding subject to the Pre-Payment Premiums
until such time as such repaid Mortgage Loans would have matured (in
accordance with their terms as in effect on the date hereof) or could have
been repaid without the incurrence of Pre-Payment Premiums, or until such time
as a holder of Preferred Units deposits an amount of cash with the Company
equal to the Pre-Payment Premiums that would have existed at the time of such
deposit had one or both (as the case may be) of the Mortgage Loans not been
repaid by the Company. If one of the Mortgage Loans matures or may be prepaid
prior to maturity without the incurrence of a Pre-Payment Premium or a holder
of Preferred Units has deposited with the Company in cash an amount equal to
the Pre-Payment Premium in respect of one of the Mortgage Loans, and the other
Mortgage Loan remains outstanding and subject to a Pre-Payment Premium, the
reduction in the Distribution provided for in this Section 2(b) shall be
reduced by (x) $145,000 in the event the M&T Note matures or may be prepaid
prior to maturity without the incurrence of a Pre-Payment Premium or a holder
of Preferred Units has deposited with the Company in cash an amount equal to
the Pre-Payment Premium in respect of such Note or (y) $190,000 in the event
the Xxxxxxx Hastings Note matures or may be prepaid prior to maturity without
the incurrence of a Pre-Payment Premium or a holder of Preferred Units has
deposited with the Company in cash an amount equal to the Pre-Payment Premium
in respect of such Note. Any reduction made in accordance with the prior
sentence shall be promptly confirmed in a written notice given by the Company
to each holder of Series D Preferred Units that are subject to the reduction
in Distribution provided for in this Section 2(b).
(c) Adjustment of Distribution Amount due to Changes in Dividends on
Common Stock. Commencing two years subsequent to the date hereof, the
Distribution set forth in Section 2(a)(i), as such Distribution may be reduced
pursuant to Section 2(b), shall be increased or decreased by an amount equal
to (i) the Distribution Amount immediately prior to such increase or decrease,
multiplied by (ii) that percentage which is equal to 50% of the percentage
increase or decrease, as the case may be, occurring from and after that date
which is two years subsequent to the date hereof in the dollar amount of the
regular quarterly dividend on the common stock of RA, par value $0.01 ("RA
Common Stock"), subject to a maximum increase as a result of the provisions of
this Section 2(c), for any one fiscal year of the Company, of 5% of the
Distribution for the Series D Preferred Units for the immediately preceding
fiscal year of the Company. Subsequent to any such fiscal year, any increase
that would have been made to the Distribution in such fiscal year, but was not
made due to the foregoing 5% limit, shall be made up to an amount that does
not exceed a 5% increase over the Distribution on the Series D Preferred Units
during the immediately preceding fiscal year of the Company. In each fiscal
year thereafter, the excess, if any, over the 5% limit applicable to the
immediately preceding fiscal year shall cumulate with the respective excesses,
if any, over the 5% limit applicable to any fiscal year prior to such
immediately preceding fiscal year and shall be carried forward and increase
the then current Distribution, but in no event shall any such increase exceed
a 5% increase over the Distribution on the Series D Preferred Units for the
immediately preceding fiscal year. In no event shall the distribution be
decreased as a result of this Section 2(c) to less than the Distribution
provided for in Section 2(a) or, if such Distribution has been reduced
pursuant to the terms of Section 2(b), to less than such reduced Distribution.
(d) For purposes of this Supplement, "Business Day" shall mean any
day, excluding Saturday, Sunday and any other day on which commercial banks in
New York are authorized or required by law to close.
3. LIQUIDATION. The Series D Preferred Units shall be preferred as
to assets over any class of Common Units and over any other class of preferred
units of the Company, other than the Series A Preferred Units, the Series B
Preferred Units and the Series C Preferred Units and any other Qualifying
Preferred Units, such that in the event of the voluntary or involuntary
liquidation, dissolution or winding up of the Company, the holders of the
Series D Preferred Units shall be entitled to have set apart for them, or to
be paid out of the assets of the Company, before any distribution is made to
or set apart for the holders of the Common Units or any other series of
preferred units or any other capital interest heretofore or hereafter issued,
other than the Series B Preferred Units and the Series C Preferred Units and
any other Qualifying Preferred Units and any other class or series of
preferred units, the authorization, creation and issuance of which shall have
been approved by the requisite percentage of outstanding Series D Preferred
Units, as provided in Section 7(a)(ii) hereof, an amount in cash equal to the
Stated Value per unit plus any "Accrued Distributions" (as defined below) as
of such date of payment. "Accrued Distributions" shall mean, as of any date of
determination, an amount equal to the amount of Distributions, determined at
the rate fixed for the payment of Distributions on the Series D Preferred
Units on such date as provided in Section 2 hereof, which would be paid on the
Series D Preferred Units for the period of time elapsed from the most recent
actual Distribution Payment Date to the date of determination (including any
amounts cumulating from prior Distribution periods in accordance with Section
2(a) hereof and any amounts carried forward from prior Distribution periods in
accordance with Section 2(c) hereof). If the assets or surplus funds to be
distributed to the holders of the Series A Preferred Units, the Series D
Preferred Units are insufficient to permit the payment to such holders of
their full preferential amount, the assets and surplus funds legally available
for distribution shall be distributed ratably among the holders of the Series
D Preferred Units, the Series C Preferred Units, the Series B Preferred Units
and any other Qualifying Preferred Units in proportion to the respective full
preferential amounts such holders are otherwise entitled to receive.
4. CONVERSION OR EXCHANGE OF SERIES D PREFERRED UNITS.
The holders of Series D Preferred Units shall have the
following conversion and exchange rights:
(i) Right to Convert or Exchange. Each Series D Preferred Unit,
at the option of the holder as set forth below, shall be (a) convertible at
any time and at the Conversion Price set forth below, into common units of
limited partnership interests of the Company ("Common Units") and (b)
exchangeable at any time for shares of preferred stock of the General Partner
("RA Preferred Stock") (subject to the Company's right to redeem Series D
Preferred Units presented for exchange for RA Preferred Stock for cash as set
forth below).
(ii) Mechanics of Conversion or Exchange. Each holder of Series
D Preferred Units who desires to convert the same into Common Units or to
exchange the same for RA Preferred Stock shall provide notice to the Company
in the form of the Notice of Conversion or Exchange attached as Schedule B
hereto (a "Conversion Notice") via telecopy, hand delivery or other mail or
messenger service. The original Conversion Notice and the certificate or
certificates representing the Series D Preferred Units for which conversion is
elected (the "Original Certificate") shall be delivered to the Company by
nationally recognized courier, duly endorsed. The date upon which a Conversion
Notice is initially received by the Company shall be a "Notice Date."
The Company shall issue and deliver within fourteen (14) Business
Days after the Notice Date, to such holder of Series D Preferred Units at the
address of the holder on the books of the Company, (i) a certificate or
certificates for the number of Common Units or RA Preferred Stock (as the case
may be) to which the holder shall be entitled as set forth herein, and (ii) if
the Series D Preferred Units represented by the Original Certificate have been
converted only in part, a new certificate evidencing the Series D Preferred
Units not subject to the conversion or exchange; provided that the Original
Certificate representing the Series D Preferred Units to be converted is
received by the transfer agent or the Company within three Business Days after
the Notice Date and the person or persons entitled to receive the Common Units
or RA Preferred Stock (as the case may be) issuable upon such conversion or
exchange shall be treated for all purposes as the record holder or holders of
such shares of Common Units on such date such Original Certificate is received
(the "Conversion Date"). If the Original Certificate representing the Series D
Preferred Units to be converted or exchanged is not received by the transfer
agent or the Company within three Business Days after the Notice Date, the
Conversion Notice shall become null and void.
(iii) Conversion into Common Units. Each Series D Preferred
Unit shall be convertible into a number of Common Units or fraction of Common
Units (such number or fraction, as the case may be, being referred to
hereinafter as the "Preferred Conversion Factor") determined in accordance
with the following formula as of the relevant Conversion Date:
Redemption Price
Preferred Conversion Factor = ----------------------
Conversion Price
where
Redemption Price = For each Series D Preferred Unit for
which conversion is elected, such Series D
Preferred Unit's Stated Value, plus any
Accrued Distributions; and
Conversion Price = $29.1165
(iv) Adjustment to Preferred Conversion Factor. The Preferred
Conversion Factor (and the Conversion Price) shall be subject to adjustment
from time to time hereafter as follows:
(a) In case the Company shall, at any time or from time to time
prior to conversion of all Series D Preferred Units, (A) pay a dividend or
make a distribution on the outstanding Common Units, in Common Units, (B)
split or subdivide the outstanding Common Units into a larger number of Common
Units, (C) effect a reverse unit split or otherwise combine the outstanding
Common Units into a smaller number of Common Units or (D) issue by
reclassification of the Common Units any units of partnership interest in the
Company, then, and in each such case, the Preferred Conversion Factor (and the
Conversion Price) in effect immediately prior to such event or the record date
therefor, whichever is earlier, shall be adjusted so that the holder of any
Series D Preferred Units thereafter surrendered for conversion shall be
entitled to receive the number of Common Units or other securities of the
Company which such holder would have owned or have been entitled to receive
after the happening of any of the events described above, had such Series D
Preferred Units been surrendered for conversion immediately prior to the
happening of such event or the record date therefor, whichever is earlier. An
adjustment made pursuant to this Section 4(iv)(a) shall become effective (x)
in the case of any such dividend or distribution, immediately after the close
of business on the record date for the determination of holders of Common
Units entitled to receive such dividend or distribution, or (y) in the case of
any such subdivision, reclassification, reverse unit split or combination, at
the close of business on the day upon which such Company action becomes
effective.
(b) In case the Company shall, at any time or from time to time
prior to conversion of all Series D Preferred Units, declare, order, pay or
make a dividend or other distribution (including, without limitation, any
distribution of units or other securities or property or rights or warrants to
subscribe for securities of the Company entitling holders thereof to subscribe
for or purchase such securities at a price per share less than the fair market
value of such securities, by way of dividend or spinoff), on its Common Units,
other than (A) regular and customary quarterly distributions by the Company of
Available Cash, or (B) dividends or distributions of Common Units which are
referred to in Section 4(iv)(a) hereof, then, and in each such case, the
Preferred Conversion Factor (and the Conversion Price) shall be adjusted so
that the holder of each Series D Preferred Unit shall be entitled to receive,
upon the conversion thereof, the number of Common Units determined by
multiplying (1) the applicable Preferred Conversion Factor on the day
immediately prior to the record date fixed for the determination of Common
Unit holders entitled to receive such dividend or distribution by (2) a
fraction, the numerator of which shall be the Deemed Market Price (as
hereinafter defined) of a Common Unit on such record date, and the denominator
of which shall be such Deemed Market Price per Common Unit less the fair
market value (as determined in good faith by the Board of Directors of the
General Partner) of such dividend or distribution allocable to one Common
Unit. An adjustment made pursuant to this Section 4 (iv) (b) shall be made
upon the opening of business on the next Business Day following the date on
which any such dividend or distribution is made and shall be effective
retroactively immediately after the close of business on the record date fixed
for the determination of Common Unit holders entitled to receive such dividend
or distribution. For purposes of this Section 4(iv), "Deemed Market Price"
shall mean, as of any date, (a) the "daily market value" of a REIT Share
determined in the manner provided in the definition of "Value", as of such
date, multiplied by (b) the Conversion Factor (as such term is defined in
Article 1 of the Partnership Agreement) in effect as of such date.
(c) In case the Company shall, at any time or from time to time
prior to conversion of all Series D Preferred Units, issue Common Units to
then existing Holders of Common Units (or securities convertible into or
exchangeable for Common Units, whether or not the rights to convert or
exchange such securities are then exercisable) at a price per Common Unit (or
having a conversion price per Common Unit, as applicable) less than the Deemed
Market Price of a Common Unit as of the date of issuance of such Common Units
or of such convertible securities, as the case may be, then, and in each such
case, the Preferred Conversion Factor (and the Conversion Price) shall be
adjusted so that the holder of each Series D Preferred Unit shall be entitled
to receive, upon conversion thereof, the number of Common Units determined by
multiplying (A) the Preferred Conversion Factor on the day immediately prior
to such date by (B) a fraction, the numerator of which shall be the sum of (1)
the number of Common Units outstanding on such date and (2) the number of
additional Common Units issued (or into which the convertible securities may
convert), and the denominator of which shall be the sum of (x) the number of
Common Units outstanding on such date and (y) the number of Common Units which
the aggregate consideration receivable by the Company for the total number of
Common Units so issued (or into which the convertible securities may convert)
would purchase at the Deemed Market Price of a Common Unit as of such date.
Any adjustment made pursuant to this Section 4(iv)(c) shall be made and become
effective on the next Business Day following the date on which any such
issuance is made and shall be effective retroactively immediately after the
close of business on such date. For purposes of this Section 4(iv)(c):
(I) if the Company shall issue Common Units for consideration
other than cash, the price per Common Unit at which such Common
Units are issued shall be deemed to be the fair market value (as
determined in good faith by the Board of Directors of the General
Partner) of the portion of such non-cash consideration allocable to
one Common Unit; and
(II) the aggregate consideration receivable by the Company in
connection with the issuance of Common Units or of securities
convertible into Common Units shall be deemed to be equal to the sum
of the aggregate offering price (before deduction of underwriting
discounts or commissions and expenses payable to third parties) of
all such securities plus the minimum aggregate amount, if any,
payable upon conversion of any such convertible securities into
Common Units.
(d) In case the Company shall, at any time or from time to time
prior to conversion of all Series D Preferred Units, make a tender offer or
exchange offer for Common Units at a price per Common Unit greater than the
Deemed Market Price of a Common Unit as of the date of such repurchase (the
number of Common Units so repurchased, multiplied by the amount by which such
price per Common Unit exceeds the Deemed Market Price of a Common Unit as of
such date, being referred to in this Section 4(iv)(d) as the "Excess Amount"),
then, and in each such case, the Preferred Conversion Factor (and the
Conversion Price) shall be adjusted, in accordance with the applicable
provisions of Sections 4(iv)(a) and 4(iv)(b) above, as if, in lieu of such
repurchase, the Company had (x) made a distribution of property having a fair
market value (as determined in good faith by the Board of Directors of the
General Partner) equal to the Excess Amount, with such distribution made to
holders of Common Units (including holders of Common Units so repurchased) on
the date of such repurchase, and (y) effected a reverse split of the Common
Units in the proportion required to reduce the number of Common Units
outstanding by the number of Common Units repurchased by the Company in such
repurchase.
(e) For purposes of this Section 4(iv), the number of Common Units
at any time outstanding shall not include any Common Units then owned or held
by or for the account of the Company.
(f) In case of any capital reorganization, recapitalization or
reclassification of outstanding Common Units (other than a recapitalization or
reclassification covered by Section 4(iv)(a) hereof), or in case of any
consolidation or merger of the Company with or into another entity, or in case
of any sale or conveyance to another entity of the property of the Company as
an entirety or substantially as an entirety (each of the foregoing being
referred to as a "Transaction"), each Series D Preferred Unit then outstanding
shall thereafter be convertible into, in lieu of the Common Units issuable
upon such conversion prior to consummation of such Transaction, the kind and
amount of units of partnership interest and other securities and property
(including cash) receivable upon the consummation of such Transaction by a
holder of that number of Common Units into which one Series D Preferred Unit
was convertible immediately prior to such Transaction (including, on a pro
rata basis, the cash, securities or property received by holders of Common
Units in any tender or exchange offer that is a step in such Transaction). In
any such case, if necessary, appropriate adjustment (as reasonably determined
by the Board of Directors of the General Partner) shall be made in the
application of the provisions set forth in this Section 4 with respect to
rights and interests thereafter of the holders of Series D Preferred Units, to
the end that the provisions set forth herein for the protection of the
conversion rights of the Series D Preferred Units shall thereafter be
applicable, as nearly as possible, to any such other units and other
securities and property deliverable upon conversion of the Series D Preferred
Units remaining outstanding (with such adjustments in the conversion price and
number of units issuable upon conversion and such other adjustments in the
provisions hereof as the Board of Directors of the General Partner shall
reasonably determine to be appropriate). In case securities or property other
than Common Units shall be issuable or deliverable upon conversion as
aforesaid, then all references in this Section 4(iv)(f) shall be deemed to
apply, so far as appropriate and as nearly as possible, to such other
securities or property.
(g) Notwithstanding anything contained herein to the contrary, the
Company will not effect any Transaction unless, prior to the consummation
thereof, the entity which will be the surviving entity as a result of such
Transaction (the "Surviving Entity") shall assume, by written instrument
mailed to each holder of Series D Preferred Units, the obligation to deliver
to such holder all cash, Surviving Entity common units or other securities to
which, in accordance with the foregoing provisions, such holder is entitled.
(h) If any adjustment under this Section 4(iv) would create a
fractional Common Unit or a right to acquire a fractional Common Unit, such
fractional Common Units shall be issued by the Company.
(i) Exchange for RA Preferred Stock. Each Series D Preferred
Unit shall be exchangeable, at the option of the holder of such Series D
Preferred Unit, for shares of RA Preferred Stock with a stated value equal to
the stated value of the Series D Preferred Units and otherwise with the same
terms as the Series D Preferred Units other than the conversion and exchange
rights provided for in this Section 4, provided that the Company may, in
respect of any Conversion Notice regarding such an exchange, elect to redeem
all of the Series D Preferred Units that are the subject of such Conversion
Notice for cash in an amount equal to the stated value of such Series D
Preferred Units plus any accrued distributions thereon.
(ii) Reservation of Common Units/Preferred Stock Issuable Upon
Conversion or Exchange. The Company shall at all times reserve and keep
available out of its authorized but unissued Common Units, and RA shall at all
times reserve and keep available out of its authorized but unissued shares of
RA Preferred Stock, solely for the purpose of effecting the conversion or
exchange of the Series D Preferred Units, such number of Common Units as shall
from time to time be sufficient to effect the conversion or exchange of all
then outstanding Series D Preferred Units; and if at any time the number of
authorized but unissued Common Units or RA Preferred Stock shall not be
sufficient to effect the conversion or exchange of all then outstanding Series
D Preferred Units, the Company and/or RA (as the case may be) will take such
action as may be necessary to increase its authorized but unissued Common
Units and/or RA Preferred Stock to such number of units or shares as shall be
sufficient for such purpose.
(iii) No Impairment. The Company will not, by amendment of the
Partnership Agreement or this Supplement or through any reorganization,
transfer of assets, consolidation, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms to be observed or performed
hereunder by the Company, and will at all times in good faith assist in the
carrying out of all of the provisions of this Section 4 and in the taking of
all such action as may be necessary or appropriate in order to protect the
conversion rights of the Series D Preferred Units hereunder against
impairment. Without limiting the generality of the foregoing, if any event
occurs as to which the foregoing provisions of this Section 4 are not strictly
applicable or, if strictly applicable, would not, in the good faith judgment
of the Board of Directors of the General Partner, fairly protect the
conversion rights of the Series D Preferred Units in accordance with the
essential intent and principles of such provisions, the Company shall make
such adjustments in the application of such provisions, in accordance with
such essential intent and principles, as shall be reasonably necessary, in the
good faith opinion of the Board of Directors of the General Partner, to
protect such conversion rights as aforesaid.
5. STATUS OF CONVERTED UNITS. In the event any Series D Preferred
Units shall be converted or exchanged as contemplated by this Supplement, the
units so converted or exchanged shall be canceled, and shall not be issuable
by the Company as Series D Preferred Units.
6. DISTRIBUTIONS ON CONVERTED OR EXCHANGED UNITS. The initial
distribution to be made with respect to Common Units or RA Preferred Stock
received pursuant to the conversion or exchange of Series D Preferred Units
shall be prorated based upon the number of days during the quarter that such
Common Units or shares of RA Preferred Stock were outstanding.
7. VOTING RIGHTS. (a) Except as otherwise specifically provided by
the Revised Uniform Limited Partnership Act of the State of Delaware or as
otherwise provided herein, the holders of Series D Preferred Units shall be
entitled to vote on any matters required or permitted to be submitted to the
holders of Common Units for their approval, and such holders of Series D
Preferred Units, holders of Series C Preferred Units, holders of Series B
Preferred Units and holders of Common Units shall vote as a single class, with
the holders of Series D Preferred Units having a number of votes equal to the
number of Series D Preferred Units then outstanding multiplied by the
Preferred Conversion Ratio in effect as of the date of such vote.
(b) In addition to, and not in limitation of, the provisions of
Section 7(a) above (and notwithstanding anything appearing to the contrary in
the Partnership Agreement), the Company shall not, without the affirmative
consent of the holders of at least sixty-six and two-thirds percent (66-2/3%)
of the then outstanding Series D Preferred Units:
(i) increase or decrease (other than by conversion or exchange)
the total number of authorized units of Series D Preferred Units;
(ii) in any manner authorize, create or issue any additional
preferred units or any class or series of capital interests, in either
case (A) ranking, either as to payment of distributions or distribution
of assets, prior to the Series D Preferred Units or (B) which in any
manner adversely affects the holders of Series D Preferred Units;
(iii) in any manner alter, change, modify, amend or supplement
the designations or the powers, preferences or rights (including, without
limitation, conversion and exchange rights), or the qualifications,
limitations or restrictions of the Series D Preferred Units or any other
terms or provisions of this Supplement or otherwise take any action in
contravention of the rights of the holders of Series D Preferred Units as
set forth in this Supplement;
(iv) reclassify the Common Units or any other units of any
class or series of capital interests hereafter created junior to the
Series D Preferred Units into units or other interests of any class or
series (A) ranking, either as to payment of distributions or distribution
of assets prior to the Series D Preferred Units, or (B) which in any
manner adversely affects the holders of Series D Preferred Units; or
(v) reclassify the Series A Preferred Units or any other
Qualifying Preferred Units now existing or hereafter created into units
or other interests of any class or series of capital interests (A)
ranking, either as to payment of distributions or distribution of assets,
prior to the Series D Preferred Units, or (B) which in any manner
adversely affects the holders of the Series D Preferred Units.
8. NOTICE OF CERTAIN EVENTS. If at any time, to the extent permitted
hereunder, the Company and/or RA proposes:
(a) to pay any distribution or dividend payable in securities (of
any class or classes) or any obligations, stock or units convertible into or
exchangeable for Common Units or the RA Common Stock upon either of their
capital securities, including, without limitation (i) Common Units or RA
Common Stock or (ii) a cash distribution other than its customary quarterly
cash distribution (collectively, an "Extraordinary Distribution");
(b) to grant to the holders of its Common Units or Common Stock
generally any rights or warrants (excluding any warrants or other rights
granted to any employee, director, officer, contractor or consultant of the
Company or the General Partner pursuant to any plan approved by the general
partner of the Company or the Board of Directors of the General Partner) (a
"Rights Distribution");
(c) to effect any capital reorganization or reclassification of
capital securities of the Company or the General Partner;
(d) to consolidate with, or merge into, any other company or to
transfer its property as an entirety or substantially as an entirety; or
(e) to take any other action, or to consummate any other
transaction, which could result in an adjustment of the Preferred Conversion
Factor (and the Conversion Price) pursuant to Section 4(iv) hereof; or
(f) to effect the liquidation, dissolution or winding up of the
Company or the General Partner, then, in any one or more of the foregoing
cases, the Company shall give, by certified or registered mail, postage
prepaid, addressed to the holders of Series D Preferred Units at the address
of such holders as shown on the record books of the Company, (i) at least
thirty (30) days' prior written notice of the date on which the books of the
Company shall close or of a record date fixed for such dividend, distribution
or subscription rights or for determining rights to vote in respect of any
such reorganization, reclassification, consolidation, merger, sale,
dissolution, liquidation or winding-up, (ii) in the case of any such
reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation or winding-up, at least thirty (30) days' prior written notice of
the date when the same shall take place, and (iii) in the case of any other
action or transaction that could result in an adjustment of the Preferred
Conversion Ratio (or the Conversion Price), at least thirty (30) days' prior
written notice of the date when such adjustment shall first become effective.
Any notice given in accordance with the foregoing clause (i) shall also
specify, in the case of any such dividend, distribution or option rights, the
date on which the holders of any class of capital securities shall be entitled
thereto.
9. RANK AND LIMITATIONS OF PREFERRED UNITS. All Series D Preferred
Units shall rank equally with each other unit of Series D Preferred Units and
shall be identical in all respects.
10. PARTNERSHIP AGREEMENT. (i) The term "transfer" as used as
Article 11 of the Partnership Agreement shall not include (a) any conversion
of Series D Preferred Units into Common Units or (b) any exchange of Series D
Preferred Units for RA Preferred Stock.
(ii) For purposes of Article 11 of the Partnership Agreement,
the General Partner (and any successor general partner under the Partnership
Agreement) shall hereby be deemed to have consented to the pledge of Series D
Preferred Units by Xxxxx X. Xxxxxxxx (or any related party) and to any related
subsequent transfer of Series D Preferred Units to the pledgee of such Units
in connection with a foreclosure on such Units or an assignment-in-lieu of
foreclosure on such pledge.
11. COVENANT OF THE COMPANY AND RA. So long as any Series D
Preferred Units are outstanding, the Company and the General Partner agree to
(i) (a) maintain the one-to-one equivalence of a share of Common Stock and a
Common Unit or (b) maintain the provisions set forth in the Partnership
Agreement as of the date hereof regarding adjustments to the Conversion Factor
(as such term is defined in the Partnership Agreement) and (ii) not issue any
capital stock or other capital interest which would cause any capital interest
in the Partnership to be senior to the Series D Preferred Units in respect of
payment of distributions or distribution of assets, except as set forth in
Section 7(b)(ii) herein.
IN WITNESS WHEREOF, the parties hereto have executed this Supplement to
the Partnership Agreement as of the 30th day of June, 1998.
GENERAL PARTNER
RECKSON ASSOCIATES REALTY CORP.
By: /s/ Xxxxx X. Xxxxxxx
----------------------------------------
Name:
Title:
EXISTING LIMITED PARTNERS
By: Reckson Associates Realty Corp.
as Attorney-in-Fact for the Limited Partners
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------
Name:
Title:
SERIES D PREFERRED UNIT HOLDERS
-------------------------------
/s/ Xxxxx X. Xxxxxxxx
---------------------------------------------
Xxxxx X. Xxxxxxxx
Schedule A
Name and Address Number of Series D Preferred Units (stated value $1,000)
---------------- --------------------------------------------------------
Xxxxx X. Xxxxxxxx 6,000
c/o Cappelli Enterprises, Inc.
000 Xxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Schedule B
Notice of Conversion or Exchange
The undersigned holder of Series D Preferred Units hereby irrevocably
requests Reckson Operating Partnership, L.P., a Delaware limited partnership
(the "Partnership") to (check one):
__
/__/ convert into common units of limited partnership interest of the
Partnership; or
__
/__/ exchange for shares of Preferred Stock of Reckson Associates Realty
Corp. ("RA")
_______ Series D Preferred Units in accordance with the terms of the Amended
and Restated Agreement of Limited Partnership of the Partnership and the
Supplement thereto establishing the Series D Preferred Units; and the
undersigned irrevocably (i) surrenders such units and all right, title and
interest therein; and (ii) directs that the common units of the
Partnership/preferred stock of RA or, in lieu thereof in respect of an
exchange for shares of Preferred Stock of RA, cash, deliverable in accordance
with this Notice be delivered to the address specified below, and in the
name(s) and at the address(es) specified below. The undersigned hereby
represents, warrants, and certifies that the undersigned (a) has good and
unencumbered title to the Series D Preferred Units that are the subject of
this Notice, free and clear of the rights or interests of any other person or
entity; (b) has the full right, power, and authority to request the conversion
or exchange requested herein; and (c) has obtained the consent or approval of
all person or entities, if any, having the right to consent or approve such
conversion or exchange of units.
Dated: _________________
Name: __________________________________
(Please Print)
__________________________________
(Signature)
__________________________________
(Xxxxxx Xxxxxxx)
__________________________________
(City) (State) (Zip Code)
If applicable, common units/preferred stock is to be issued to:
Name: ________________________________
Please indicate social security number: __________
