Exhibit 10.3

 

AMENDMENT TO

 

SECOND AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT

 

OF

 

INDUSTRIAL PROPERTY OPERATING PARTNERSHIP LP

 

A DELAWARE LIMITED PARTNERSHIP

 

THIS AMENDMENT (this “Amendment”) to the Second Amended and Restated Limited
Partnership Agreement of Industrial Property Operating Partnership LP, a
Delaware limited partnership (the “Operating Partnership”), is entered into on
or about October 7, 2019, but shall be effective as of January 1, 2019 (the
“Effective Date”), by and among (a) Industrial Property Trust, Inc., a Maryland
corporation (“General Partner”), (b) the Operating Partnership and
(c) Industrial Property Advisors Group LLC, a Delaware limited liability company
(“Special OP Unitholder”). The General Partner, Operating Partnership and the
Special OP Unitholder are collectively referred to herein as the “Parties” and
each a “Party.”

 

W I T N E S S E T H

 

WHEREAS, the Parties are parties to that certain Second Amended and Restated
Limited Partnership Agreement of Industrial Property Operating Partnership LP
dated August 14, 2015 (the “Agreement”), which is amended hereby;

 

WHEREAS, on August 20, 2019, General Partner, Prologis, L.P., a Delaware limited
partnership (“PLD”), and Rockies Acquisition LLC, a Delaware limited liability
company and a wholly-owned subsidiary of PLD, entered into an Amended and
Restated Agreement and Plan of Merger (“Merger Agreement”) pursuant to which
General Partner has elected to engage in an asset sale with PLD and its
affiliates, rather than a merger of Rockies Acquisition LLC with and into
General Partner, and the board of directors of General Partner has unanimously
approved the Asset Sale (as defined below), the Merger Agreement and the other
transactions contemplated by the Merger Agreement;

 

WHEREAS, the Merger Agreement provides for the sale of substantially all of
General Partner’s assets to PLD through (i) two mergers (each, a “Merger” and
collectively the “Mergers”) of Rockies Acquisition LLC or newly formed Delaware
limited liability companies that are wholly owned subsidiaries of PLD or an
affiliate of PLD with and into newly formed, wholly owned subsidiaries of IPT
Real Estate Holdco LLC, a Delaware limited liability company and indirect
subsidiary of General Partner, with each such applicable newly formed, wholly
owned subsidiary of IPT Real Estate Holdco LLC surviving each Merger as a wholly
owned subsidiary of PLD or an affiliate of PLD upon the terms and subject to the
conditions set forth in the Merger Agreement, and (ii) the sale (each such asset
transfer, together with the Mergers, the “Asset Sale”) by IPT Real Estate Holdco
LLC of up to ten to-be-formed Delaware limited liability companies that are
wholly owned subsidiaries of IPT Real Estate Holdco LLC to PLD or an affiliate
of PLD;

 

WHEREAS, in connection with the Asset Sale, General Partner has agreed to sell
all of its subsidiaries in which it has an ownership interest (excluding the
Operating Partnership, IPT Real Estate Holdco LLC and its subsidiaries that hold
General Partner’s collective interests in Build-to-Core Industrial Partnership I
LP, a Delaware limited partnership, and Build-to-Core Industrial Partnership II
LP, a Delaware limited partnership (the “BTC Portfolio”); and potentially
excluding IPT Acquisition, IPT Property Management, and IPT Services) to
affiliates of PLD by way of the Asset Sale, causing General Partner to continue
to exist and for its remaining assets to primarily consist of the BTC Portfolio,
and resulting in all holders of General Partner’s common stock to continue to
hold their respective shares of common stock in General Partner;

 

WHEREAS, if and when the Asset Sale is completed, all holders of General
Partner’s common stock will then be entitled to receive a special distribution
from General Partner in cash equal to such stockholder’s pro rata share of the
net total consideration for the Asset Sale, as more fully described in General
Partner’s preliminary proxy

 

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statement in connection with the Mergers and Asset Sale as filed with the U.S.
Securities and Exchange Commission on September 12, 2019;

 

WHEREAS, the Parties have, as of the Effective Date, hereby agreed to generate a
reduction in total, combined fees payable to Industrial Property Advisors LLC, a
Delaware limited liability company (the “Advisor”) under that certain Amended
and Restated Advisory Agreement (2019) dated as of June 12, 2019, in connection
with the Asset Sale or any other Sale (as defined in the Agreement) of the
Wholly-Owned Portfolio (as defined below);

 

WHEREAS, the Parties have, as of the Effective Date, hereby agreed that the
Advisor will receive an increased promote interest in the Operating Partnership
to the Special OP Unitholder and shall subsequently transfer its Special
Partnership Units to an affiliate of the Advisor, which increased promote
interest shall (with limited exceptions described in the final sentence of
Section 2 below) not apply to the Asset Sale or any other Sale of the
Wholly-Owned Portfolio, and which aforementioned increased promote interest to
the Special OP Unitholder is to be effected by this Amendment.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the Parties agree as follows:

 

1.                                      Article I.

 

a.                                      The defined term “Distribution Hurdle
Requirement” is hereby inserted, in alphabetical order, under Article I (DEFINED
TERMS) and shall read as follows: “‘DISTRIBUTION HURDLE REQUIREMENT’ has the
meaning provided in Section 5.2(b)(i)(1)(A) hereof.”

 

b.                                      The defined term “Wholly-Owned
Portfolio” is hereby inserted, in alphabetical order, under Article I (DEFINED
TERMS) and shall read as follows: “‘WHOLLY-OWNED PORTFOLIO’ has the meaning
provided in Section 5.2(b)(i) hereof.”

 

2.                                      Section 5.2 (DISTRIBUTION OF CASH). 
Sections 5.2(b)(i) and 5.2(b)(ii) are hereby deleted in their entirety and
replaced with:

 

(i)                                     Distributions of Net Sales Proceeds
shall be made as follows:

 

(A)       with respect to a Sale involving the Properties owned 100% by the
Partnership (the “Wholly-Owned Portfolio”), all distributions of Net Sales
Proceeds shall be made: (1) first, 100% to the OP Unitholders in accordance with
their respective Percentage Interests on the Partnership Record Date provided
that the aggregate distributions made hereunder to the Class T Unitholders shall
be reduced by the aggregate Distribution Fee payable by the General Partner with
respect to Class T REIT Shares with respect to such Record Date to the extent
the aggregate reduction made under Section 5.2(b)(ii) below with respect to such
Record Date is less than the Distribution Fee payable with respect to such date,
until the General Partner (and its shareholders), have received cumulative
distributions under this Section 5.2(b) (taking into account the aggregate
distributions made pursuant to this Section 5.2(b)(i) and
Section 5.2(b)(ii) below), equal to the aggregate Capital Contributions made by
the General Partner (and its shareholders), to the Partnership plus a
cumulative, non-compounded pre-tax rate of return thereon of 6.5% per annum (the
“Distribution Hurdle Requirement”), determined by taking into account the dates
on which all such Capital Contributions and distributions were made and
(2) second, (I) 85% to the OP Unitholders, in accordance with their respective
Percentage Interests on the Partnership Record Date and (II) 15% to the Special
OP Unitholders in accordance with their respective Special Percentage Interests
on the Partnership Record Date; and

 

(B)       thereafter, and assuming the Distribution Hurdle Requirement has been
previously met, all other distributions of Net Sales Proceeds shall be made:
(1) 65% to the OP Unitholders in accordance with their respective Percentage
Interests on the Partnership Record Date, and (2) 35% to the Special OP
Unitholders in accordance with their respective Special Percentage Interests on
the Partnership Record Date;

 

(ii)                                  All distributions of cash other than Net
Sales Proceeds shall be made as follows:

 

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(A)       prior to a Sale of the Wholly-Owned Portfolio, to the OP Unitholders
in accordance with their respective Percentage Interests on the Partnership
Record Date, provided that the aggregate distribution made hereunder to Class T
Unitholders shall be reduced by the aggregate Distribution Fee payable by the
General Partner with respect to Class T REIT Shares with respect to such Record
Date, and

 

(B)       thereafter: (1) 65% to the OP Unitholders in accordance with their
respective Percentage Interests on the Partnership Record Date, provided that
the aggregate distribution made hereunder to Class T Unitholders shall be
reduced by the aggregate Distribution Fee payable by the General Partner with
respect to Class T REIT Shares, and (2) 35% to the Special OP Unitholders in
accordance with their respective Special Percentage Interests on the Partnership
Record Date.

 

The foregoing assumes that a Sale of the Wholly-Owned Portfolio occurs prior to
any distributions under Sections 5.2(b)(i)(B) or 5.2(b)(ii)(B).  If the Sale of
the Wholly-Owned Portfolio occurs after any other Sale otherwise contemplated to
be subject to the distribution priorities described in Section 5.2(b)(i)(B) (but
for the fact that the Distribution Hurdle Requirement had not yet been met at
the time of such other Sale), the General Partner shall have the authority to
make distributions of Net Sales Proceeds from the Sale of the Wholly-Owned
Portfolio in a manner reasonably designed to achieve a substantially similar
outcome to what would have been obtained had the sale of the Wholly-Owned
Portfolio occurred prior to such Sale contemplated in Section 5.2(b)(i)(B).”

 

3.                                      Entire Agreement.  The Agreement, as
amended by this Amendment, constitutes the entire agreement between the Parties
and supersedes any prior agreements or understandings between them with respect
to the subject matter thereof.

 

4.                                      Full Force and Effect.  Except as
expressly amended hereby, the Agreement shall remain in full force and effect.

 

5.                                      Further Action.  Each Party, upon the
request of the General Partner, agrees to perform all further acts and execute,
acknowledge and deliver any documents which may be reasonably necessary,
appropriate or desirable to carry out the provisions of this Amendment.

 

6.                                      Counterpart Execution.  This Amendment
may be executed in any number of counterparts, and each such counterpart shall
be deemed to be an original instrument, but all such counterparts together shall
constitute but one agreement.  This Amendment may be delivered by one or more
parties by electronic transmission device pursuant to which the signature of or
on behalf of such party can be seen, and such execution and delivery shall be
considered valid, binding and effective for all purposes.

 

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IN WITNESS WHEREOF, the Parties hereto have executed this Amendment as of the
Effective Date.

 

 

GENERAL PARTNER:

 

 

 

INDUSTRIAL PROPERTY TRUST INC., a

 

 

 

Maryland corporation

 

 

 

By:

/s/ Thomas McGonagle

 

 

 

 

 

Name:

Thomas McGonagle

 

 

 

 

 

 

Title:

Chief Financial Officer

 

 

 

LIMITED PARTNER:

 

 

 

INDUSTRIAL PROPERTY TRUST INC.

 

 

 

By:

/s/ Thomas McGonagle

 

 

 

 

 

Name:

Thomas McGonagle

 

 

 

 

 

 

Title:

Chief Financial Officer

 

 

 

SPECIAL OP UNITHOLDER:

 

 

 

INDUSTRIAL PROPERTY ADVISORS GROUP LLC

 

 

 

By:

/s/ Evan H. Zucker

 

 

 

 

 

Name:

Evan H. Zucker

 

 

 

 

 

 

Title:

Manager

 

 

 

PARTNERSHIP:

 

 

 

INDUSTRIAL PROPERTY OPERATING PARTNERSHIP LP

 

 

 

By:

INDUSTRIAL PROPERTY TRUST INC., its Sole General Partner

 

 

 

 

By:

/s/ Thomas McGonagle

 

 

 

 

 

 

 

Name:

Thomas McGonagle

 

 

 

 

 

 

 

 

Title:

Chief Financial Officer

 

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