Exhibit 10.1

 

 

AMENDED AND RESTATED

 

AGREEMENT OF LIMITED PARTNERSHIP

 

OF

 

CYRUSONE LP

 

a Maryland limited partnership

 

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THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE
SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION, UNLESS THE TRANSFEROR DELIVERS TO THE PARTNERSHIP
AN OPINION OF COUNSEL SATISFACTORY TO THE PARTNERSHIP, TO THE EFFECT
THAT THE PROPOSED SALE, TRANSFER OR OTHER DISPOSITION MAY BE
EFFECTED WITHOUT REGISTRATION UNDER THE SECURITIES ACT AND UNDER
APPLICABLE STATE SECURITIES OR “BLUE SKY” LAWS.

 

dated as of May 2, 2016

 

 

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TABLE OF CONTENTS

 

 

 

Page

ARTICLE 1 DEFINED TERMS

1

 

 

ARTICLE 2 ORGANIZATIONAL MATTERS

15

Section 2.1

Formation

15

Section 2.2

Name

15

Section 2.3

Principal Office and Resident Agent

15

Section 2.4

Power of Attorney

16

Section 2.5

Term

17

 

 

 

ARTICLE 3 PURPOSE

 

17

Section 3.1

Purpose and Business

17

Section 3.2

Powers

17

Section 3.3

Partnership Only for Purposes Specified

17

Section 3.4

Representations and Warranties by the Partners

17

 

 

 

ARTICLE 4 CAPITAL CONTRIBUTIONS

19

Section 4.1

Capital Contributions of the Partners

19

Section 4.2

Issuances of Additional Partnership Interests

19

Section 4.3

Additional Funds and Capital Contributions

20

Section 4.4

Stock Option Plans

21

Section 4.5

Dividend Reinvestment Plan, Stock Incentive Plan or Other Plan

23

Section 4.6

No Interest; No Return

23

Section 4.7

Conversion or Redemption of Preferred Shares; Redemption of REIT Shares

23

Section 4.8

Other Contribution Provisions

24

Section 4.9

Excluded Properties

24

 

 

 

ARTICLE 5 DISTRIBUTIONS

24

Section 5.1

Requirement and Characterization of Distributions

24

Section 5.2

Distributions in Kind

25

Section 5.3

Amounts Withheld

25

Section 5.4

Distributions upon Liquidation

25

Section 5.5

Distributions to Reflect Additional Partnership Units

25

Section 5.6

Restricted Distributions

25

 

 

 

ARTICLE 6 ALLOCATIONS

25

Section 6.1

Timing and Amount of Allocations of Net Income and Net Loss

25

Section 6.2

General Allocations

25

Section 6.3

Additional Allocation Provisions

26

Section 6.4

Tax Allocations

28

 

 

 

ARTICLE 7 MANAGEMENT AND OPERATIONS OF BUSINESS

28

Section 7.1

Management

28

Section 7.2

Certificate of Limited Partnership

29

Section 7.3

Restrictions on General Partner’s Authority

30

Section 7.4

Reimbursement of the General Partner and the Special Limited Partner

32

Section 7.5

Outside Activities of the General Partner and the Special Limited Partner

32

Section 7.6

Transactions with Affiliates

33

Section 7.7

Indemnification

33

Section 7.8

Liability of the General Partner and the Special Limited Partner

35

Section 7.9

Title to Partnership Assets

36

 

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Section 7.10

Reliance by Third Parties

37

 

 

 

ARTICLE 8 RIGHTS AND OBLIGATIONS OF LIMITED PARTNERS

37

Section 8.1

Limitation of Liability

37

Section 8.2

Management of Business

37

Section 8.3

Outside Activities of Limited Partners

37

Section 8.4

Return of Capital

38

Section 8.5

Rights of Limited Partners Relating to the Partnership

38

Section 8.6

Partnership Right to Call Partnership Interests

38

Section 8.7

No Rights as Objecting Partner

38

Section 8.8

No Right to Certificate Evidencing Units; Article 8 Securities

38

 

 

 

ARTICLE 9 BOOKS, RECORDS, ACCOUNTING AND REPORTS

39

Section 9.1

Records and Accounting

39

Section 9.2

Partnership Year

39

Section 9.3

Reports

39

 

 

 

ARTICLE 10 TAX MATTERS

39

Section 10.1

Preparation of Tax Returns

39

Section 10.2

Tax Elections

40

Section 10.3

Tax Matters Partner

40

Section 10.4

Withholding

41

Section 10.5

Organizational Expenses

41

 

 

 

ARTICLE 11 PARTNER TRANSFERS AND WITHDRAWALS

42

Section 11.1

Transfer

42

Section 11.2

Transfer of General Partner’s Partnership Interest

42

Section 11.3

Limited Partners’ Rights to Transfer

42

Section 11.4

Substituted Limited Partners

44

Section 11.5

Assignees

45

Section 11.6

General Provisions

45

Section 11.7

Restrictions on Termination Transactions

46

 

 

 

ARTICLE 12 ADMISSION OF PARTNERS

47

Section 12.1

Admission of Successor General Partner

47

Section 12.2

Admission of Additional Limited Partners

47

Section 12.3

Amendment of Agreement and Certificate of Limited Partnership

48

Section 12.4

Limit on Number of Partners

48

Section 12.5

Admission

48

 

 

 

ARTICLE 13 DISSOLUTION, LIQUIDATION AND TERMINATION

48

Section 13.1

Dissolution

48

Section 13.2

Winding Up

49

Section 13.3

Deemed Contribution and Distribution

50

Section 13.4

Rights of Holders

50

Section 13.5

Notice of Dissolution

50

Section 13.6

Cancellation of Certificate of Limited Partnership

50

Section 13.7

Reasonable Time for Winding-Up

50

 

 

 

ARTICLE 14 PROCEDURES FOR ACTIONS AND CONSENTS OF PARTNERS; AMENDMENTS; MEETINGS

51

Section 14.1

Actions and Consents of Partners

51

Section 14.2

Amendments

51

Section 14.3

Procedures for Meetings and Actions of the Partners

51

 

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ARTICLE 15 GENERAL PROVISIONS

52

 

 

 

Section 15.1

Redemption Rights of Qualifying Parties

52

Section 15.2

Addresses and Notice

57

Section 15.3

Titles and Captions

57

Section 15.4

Pronouns and Plurals

57

Section 15.5

Further Action

57

Section 15.6

Binding Effect

57

Section 15.7

Waiver

58

Section 15.8

Counterparts

58

Section 15.9

Applicable Law; Consent to Jurisdiction; Jury Trial

58

Section 15.10

Entire Agreement

58

Section 15.11

Invalidity of Provisions

59

Section 15.12

Limitation to Preserve REIT Status

59

Section 15.13

REIT Restrictions

59

Section 15.14

No Partition

60

Section 15.15

No Third-Party Rights Created Hereby

60

Section 15.16

No Rights as Stockholders

60

 

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Exhibit A

EXAMPLES REGARDING ADJUSTMENT FACTOR

A-1

Exhibit B

NOTICE OF REDEMPTION

B-1

 

iv

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AMENDED AND RESTATED AGREEMENT OF
LIMITED PARTNERSHIP OF CYRUSONE LP

 

THIS AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF CYRUSONE LP, dated
as of May 2, 2016, is entered into by and among CYRUSONE GP, a Maryland
statutory trust, (the “Initial General Partner”), CyrusOne Inc., a Maryland
corporation (the “Special Limited Partner”), and any additional partner that is
admitted from time to time to the Partnership.

 

WHEREAS, a Certificate of Limited Partnership of the Partnership was accepted
for record by the State Department of Assessments and Taxation of Maryland on
July 31, 2012 (the “Formation Date”);

 

WHEREAS, the Initial General Partner and the Special Limited Partner entered
into an original Agreement of Limited Partnership of the Partnership effective
as of July 31, 2012, and an Amended and Restated Agreement of Limited
Partnership on September 27, 2012, and the General Partner, Data Center
Investments Inc., a Delaware corporation (“Data Investments”), Data Centers
South Inc., a Delaware corporation (“Data South”), and the Special Limited
Partner entered into an Amended and Restated Agreement of Limited Partnership on
November 20, 2012, which was amended by the Amendment One and Amendment Two
thereto, among the Initial General Partner, the Special Limited Partner, Data
Center Investments Holdco LLC, a Delaware limited liability company
(“Investments Holdco”), as a Limited Partner, Data Centers South Holdings LLC, a
Delaware limited liability company (“South Holdings”), Data Investments and Data
South and amended and restated by an Amended and Restated Agreement of Limited
Partnership, dated January 24, 2013, among the General Partner, the Special
Limited Partner Cincinnati Bell, Inc., an Ohio corporation (“CBI”), Investments
Holdco and South Holdings LLC, a Delaware limited liability company (as amended,
the “Current Amended and Restated Partnership Agreement”);

 

WHEREAS, as of December 31, 2015, CBI and all of its Controlled Entities have
ceased to be Partners or hold any Partnership Interests; and

 

WHEREAS, the Initial General Partner and the Special Limited Partner, being the
only remaining Partners of the Partnership, now desire to amend and restate the
Current Amended and Restated Partnership Agreement to read in its entirety as
set forth herein.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

 

ARTICLE 1
DEFINED TERMS

 

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 Maryland Revised Uniform Limited Partnership Act, Title 10 of
the Corporations and Associations Article of the Annotated Code of Maryland, as
it may be amended from time to time, and any successor to such statute.

 

“Actions” has the meaning set forth in Section 7.7 hereof.

 

“Additional Funds” has the meaning set forth in Section 4.3.A hereof.

 

“Additional Limited Partner” means a Person who is admitted to the Partnership
as a Limited Partner pursuant to the Act and Section 12.2 hereof, who is shown
as such on the books and records of the Partnership, and who has not ceased to
be a Limited Partner pursuant to the Act and this Agreement.

 

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“Adjusted Available Cash” means, as of any date of determination, the sum of
Available Cash and REIT Available Cash.

 

“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 Partnership Year, after giving effect to the following adjustments:

 

(i)                                     decrease such deficit by any amounts
that such Partner is obligated to restore pursuant to this Agreement or by
operation of law upon liquidation of such Partner’s Partnership Interest or that
such Partner is deemed to be obligated to restore pursuant to the penultimate
sentence of each of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); 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 Factor” means 1.0; provided, however, that in the event that:

 

(i)                                     the Special Limited Partner (a) declares
or pays a dividend on its outstanding REIT Shares wholly or partly in REIT
Shares or makes a distribution to all holders of its outstanding REIT Shares
wholly or partly in REIT Shares, (b) splits or subdivides its outstanding REIT
Shares or (c) effects a reverse stock split or otherwise combines its
outstanding REIT Shares into a smaller number of REIT Shares, the Adjustment
Factor shall be adjusted by multiplying the Adjustment Factor previously in
effect by a fraction, (i) the numerator of which shall be the number of REIT
Shares issued and outstanding on the record date for such dividend,
distribution, split, subdivision, reverse split or combination (assuming for
such purposes that such dividend, distribution, split, subdivision, reverse
split or combination has occurred as of such time) and (ii) the denominator of
which shall be the actual number of REIT Shares (determined without the above
assumption) issued and outstanding on the record date for such dividend,
distribution, split, subdivision, reverse split or combination;

 

(ii)                                  the Special Limited Partner distributes
any rights, options or warrants to all holders of its REIT Shares to subscribe
for or to purchase or to otherwise acquire REIT Shares, or other securities or
rights convertible into, exchangeable for or exercisable for REIT Shares (other
than REIT Shares issuable pursuant to a Qualified DRIP), at a price per share
less than the Value of a REIT Share on the record date for such distribution
(each a “Distributed Right”), then, as of the distribution date of such
Distributed Rights or, if later, the time such Distributed Rights become
exercisable, the Adjustment Factor shall be adjusted by multiplying the
Adjustment Factor previously in effect by a fraction (a) the numerator of which
shall be the number of REIT Shares issued and outstanding on the record date
(or, if later, the date such Distributed Rights become exercisable) plus the
maximum number of REIT Shares purchasable under such Distributed Rights and
(b) the denominator of which shall be the number of REIT Shares issued and
outstanding on the record date (or, if later, the date such Distributed Rights
become exercisable) plus a fraction (1) the numerator of which is the maximum
number of REIT Shares purchasable under such Distributed Rights, multiplied by
the minimum purchase price per REIT Share under such Distributed Rights and
(2) the denominator of which is the Value of a REIT Share as of the record date
(or, if later, the date such Distributed Rights become exercisable); provided,
however, that, if any such Distributed Rights expire or become no longer
exercisable, then the Adjustment Factor shall be adjusted, effective retroactive
to the date of distribution (or, if later, the time the Distributed Rights
become exercisable) of the Distributed Rights, to reflect a reduced maximum
number of REIT Shares or any change in the minimum purchase price for the
purposes of the above fraction; and

 

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(iii)                               the Special Limited Partner shall, by
dividend or otherwise, distribute to all holders of its REIT Shares evidences of
its indebtedness or assets (including securities, but excluding any dividend or
distribution referred to in subsection (i) or (ii) above), which evidences of
indebtedness or assets relate to assets not received by the General Partner
and/or any Special Limited Partner pursuant to a pro rata distribution by the
Partnership, then the Adjustment Factor shall be adjusted to equal the amount
determined by multiplying the Adjustment Factor in effect immediately prior to
the close of business as of the record date fixed for the determination of
stockholders entitled to receive such distribution by a fraction (a) the
numerator of which shall be such Value of a REIT Share on such record date and
(b) the denominator of which shall be the Value of a REIT Share as of such
record date less the then fair market value (as determined by the General
Partner, whose determination shall be conclusive) of the portion of the
evidences of indebtedness or assets so distributed applicable to one REIT Share.

 

Notwithstanding the foregoing, no adjustments to the Adjustment Factor will be
made to the extent that the Partnership makes or effects any correlative
distribution or payment to all of the Partners holding Partnership Common Units,
or effects any correlative split or reverse split in respect of the Partnership
Common Units.  Any adjustments to the Adjustment Factor shall become effective
immediately after such event, retroactive to the record date, if any, for such
event.  For illustrative purposes, examples of adjustments to the Adjustment
Factor are set forth on Exhibit A attached hereto.

 

“Affiliate” means, with respect to any Person, any Person directly or indirectly
controlling or controlled by or under common control with such Person.  For the
purposes of this definition, “control” when used with respect to any Person
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise, and the terms
“controlling” and “controlled” have meanings correlative to the foregoing.

 

“Affiliated REIT” means the Special Limited Partner and any Affiliate of the
Special Limited Partner that has elected to be taxed as a REIT under the Code.

 

“Agreement” means this Amended and Restated Limited Partnership Agreement of
CyrusOne LP, as now or hereafter amended, restated, modified, supplemented or
replaced.

 

“Applicable Percentage” has the meaning set forth in Section 15.1B hereof.

 

“Assignee” means a Person to whom a Partnership Interest has been Transferred
but who has not become a Substituted Limited Partner, and who has the rights set
forth in Section 11.5 hereof.

 

“Available Cash” means, with respect to any period for which such calculation is
being made,

 

(i)                                     the sum, without duplication, of:

 

(1)                                 the Partnership’s Net Income or Net Loss (as
the case may be) for such period,

 

(2)                                 Depreciation and all other noncash charges
to the extent deducted in determining Net Income or Net Loss for such period,

 

(3)                                 the amount of any reduction in reserves of
the Partnership established by the General Partner (including, without
limitation, reductions resulting because the General Partner determines such
amounts are no longer necessary),

 

(4)                                 the excess, if any, of the net cash proceeds
from the sale, exchange, disposition, financing or refinancing of Partnership
property for such period over the gain (or loss, as the case may be) recognized
from such sale, exchange, disposition, financing or refinancing during such
period, and

 

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(5)                                 all other cash received (including amounts
previously accrued as Net Income and amounts of deferred income) or any net
amounts borrowed by the Partnership for such period that was not included in
determining Net Income or Net Loss for such period;

 

(ii)                                  less the sum, without duplication, of:

 

(1)                                 all principal debt payments made during such
period by the Partnership,

 

(2)                                 capital expenditures made by the Partnership
during such period,

 

(3)                                 investments in any entity (including loans
made thereto) to the extent that such investments are not otherwise described in
clause (ii)(1) or clause (ii)(2) above,

 

(4)                                 all other expenditures and payments not
deducted in determining Net Income or Net Loss for such period (including
amounts paid in respect of expenses previously accrued),

 

(5)                                 any amount included in determining Net
Income or Net Loss for such period that was not received by the Partnership
during such period,

 

(6)                                 the amount of any increase in reserves
(including, without limitation, working capital reserves) established by the
General Partner during such period, and

 

(7)                                 any amount distributed or paid in redemption
of any Limited Partner’s Partnership Interest or Partnership Units, including,
without limitation, any Cash Amount paid.

 

Notwithstanding the foregoing, Available Cash shall not include (a) any cash
received or reductions in reserves, or take into account any disbursements made,
or reserves established, after dissolution and the commencement of the
liquidation and winding up of the Partnership or (b) any Capital Contributions,
whenever received or any payments, expenditures or investments made with such
Capital Contributions.

 

“Board of Directors” means the Board of Directors of the Special Limited
Partner.

 

“Business Day” means any day except a Saturday, Sunday or other day on which
commercial banks in New York, New York are authorized or required by law to
close.

 

“Capital Account” means, with respect to any Holder, the Capital Account
maintained by the General Partner for such Holder on the Partnership’s books and
records in accordance with the following provisions:

 

(a)                                 To each Holder’s Capital Account, there
shall be added such Holder’s Capital Contributions, such Holder’s distributive
share of Net Income and any items in the nature of income or gain that are
specially allocated pursuant to Section 6.3 hereof, and the amount of any
Partnership liabilities assumed by such Holder or that are secured by any
property distributed to such Holder.

 

(b)                                 From each Holder’s Capital Account, there
shall be subtracted the amount of cash and the Gross Asset Value of any property
distributed to such Holder pursuant to any provision of this Agreement, such
Holder’s distributive share of Net Losses and any items in the nature of
expenses or losses that are specially allocated pursuant to Section 6.3 hereof,
and the amount of any liabilities of such Holder assumed by the Partnership or
that are secured by any property contributed by such Holder to the Partnership
(except to the extent already reflected in the amount of such Holder’s Capital
Contribution).

 

4

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(c)                                  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
that it relates to the Transferred interest.

 

(d)                                 In determining the amount of any liability
for purposes of subsections (a) and (b) hereof, there shall be taken into
account Code Section 752(c) and any other applicable provisions of the Code and
Regulations.

 

(e)                                  The provisions of this Agreement relating
to the maintenance of Capital Accounts are intended to comply with Regulations
promulgated under Section 704 of the Code, and shall be interpreted and applied
in a manner consistent with such Regulations.  The General Partner may modify
the manner in which the Capital Accounts are maintained in order to comply with
such Regulations, provided that the General Partner determines that such
modification is not reasonably likely to have a material effect on the amounts
distributable to any Partner without such Partner’s consent.  The General
Partner also may (i) make any adjustments to maintain equality between the
Capital Accounts of the Holders 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 (ii) make any appropriate
modifications in the event that unanticipated events might otherwise cause this
Agreement not to comply with Regulations Section 1.704-1(b) or Section 1.704-2;
provided, however, that the General Partner determines that such changes are not
reasonably likely to materially reduce amounts otherwise distributable to the
Holders as current cash distributions or as distributions on termination of the
Partnership.

 

“Capital Contribution” means, with respect to any Partner, the amount of money
and the initial Gross Asset Value of any Contributed Property that such Partner
contributes to the Partnership or is deemed to contribute pursuant to Article 4
hereof.

 

“Capital Share” means a share of any class or series of stock of the Special
Limited Partner now or hereafter authorized, other than a REIT Share.

 

“Cash Amount” means an amount of cash equal to the product of (i) the Value of a
REIT Share and (ii) the REIT Shares Amount determined as of the applicable
Valuation Date.

 

“Certificate” means the Certificate of Limited Partnership of the Partnership
filed with the SDAT, as amended from time to time in accordance with the terms
hereof and the Act.

 

“Charity” means an entity described in Section 501(c)(3) of the Code, or any
trust all the beneficiaries of which are such entities.

 

“Charter” means the charter of the Special Limited Partner, within the meaning
of Section 1-101(f) of the Maryland General Corporation Law.

 

“Code” means the Internal Revenue Code of 1986, as amended and in effect 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.

 

“Consent” means the consent to, approval of, or vote in favor of 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, which Consent shall be obtained before the taking of any
action for which it is required by this Agreement and, except as otherwise
provided in this Agreement, may be given or withheld by Partners in their
discretion.

 

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“Consent of the Partners” means the Consent of a Majority in Interest of the
Partners, which Consent shall be obtained before the taking of any action for
which it is required by this Agreement and, except as otherwise provided in this
Agreement, may be given or withheld by Partners in their discretion.

 

“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 deemed contributed by the Partnership to a “new”
partnership pursuant to Code Section 708).

 

“Controlled Entity” means, as to any Person, (a) any corporation more than fifty
percent (50%) of the outstanding voting stock of which is owned by such Person
or such Person’s Family Members or Affiliates, (b) any trust, whether or not
revocable, of which such Person or such Person’s Family Members or Affiliates
are the sole beneficiaries, (c) any partnership of which such Person or an
Affiliate of such Person is the managing partner and in which such Person or
such Person’s Family Members or Affiliates hold partnership interests
representing at least twenty-five percent (25%) of such partnership’s capital
and profits and (d) any limited liability company of which such Person or an
Affiliate of such Person is the manager or managing member and in which such
Person or such Person’s Family Members or Affiliates hold membership interests
representing at least twenty-five percent (25%) of such limited liability
company’s capital and profits.

 

“Cut-Off Date” means the fifth (5th) Business Day after the General Partner’s
receipt of a Notice of Redemption.

 

“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
that, in accordance with generally accepted accounting principles, should be
capitalized.

 

“Declination” has the meaning set forth in Section 15.1.A hereof.

 

“Depreciation” means, for each Partnership Year or other applicable period, an
amount equal to the Federal income tax 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
period, Depreciation shall be in an amount that 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 or
period is zero, Depreciation shall be determined with reference to such
beginning Gross Asset Value using any reasonable method selected by the General
Partner.

 

“Distributed Right” has the meaning set forth in the definition of “Adjustment
Factor.”

 

“Equity Plan” means any stock or equity purchase plan, restricted stock or
equity plan or other similar equity compensation plan now or hereafter adopted
by the Partnership, the General Partner or the Special Limited Partner.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and any
successor statute thereto, and the rules and regulations of the SEC promulgated
thereunder.

 

“Excess Units” means Tendered Units, the issuance of REIT Shares in exchange for
which would result in a violation of the Ownership Limit.

 

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“Excluded Property” means any asset now or hereafter held directly by the
Special Limited Partner or any direct or indirect wholly-owned Subsidiary of the
Special Limited Partner (other than the equity of any direct or indirect
wholly-owned Subsidiary of the Partnership and interests in the Partnership).

 

“Family Members” means, as to a Person that is an individual, such Person’s
spouse, ancestors, descendants (whether by blood or by adoption), brothers and
sisters and inter vivos or testamentary trusts of which only such Person and his
spouse, ancestors, descendants (whether by blood or by adoption), brothers and
sisters are beneficiaries.

 

“Funding Debt” means any Debt incurred by or on behalf of the General Partner or
the Special Limited Partner for the purpose of providing funds to the
Partnership.

 

“General Partner” means the Initial General Partner or any other Person that is,
from time to time, admitted to the Partnership as a general partner pursuant to
the Act and this Agreement, and, in each case, that has not ceased to be a
general partner pursuant to the Act and this Agreement, in such Person’s
capacity as a general partner of the Partnership.

 

“General Partner Loan” has the meaning set forth in Section 4.3.D hereof.

 

“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 General Partner using such reasonable
method of valuation as it may adopt.

 

(ii)                                  The Gross Asset Values of all Partnership
assets immediately prior to the occurrence of any event described below 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,
as of the following times:

 

(1)                                 the acquisition of an additional interest in
the Partnership (other than in connection with the execution of this Agreement
but including, without limitation, acquisitions pursuant to Section 4.2 hereof
or contributions or deemed contributions by the General Partner pursuant to
Section 4.2 hereof) by a new or existing Holder 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 Holders;

 

(2)                                 the distribution by the Partnership to a
Holder 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 Holders;

 

(3)                                 the liquidation of the Partnership within
the meaning of Regulations Section 1.704-1(b)(2)(ii)(g);

 

(4)                                 upon the admission of a successor General
Partner pursuant to Section 12.1 hereof; and

 

(5)                                 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 Holder shall be the gross fair market value of such asset
on the date of distribution as determined by the General Partner using such
reasonable method of valuation as it may adopt.

 

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(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
subsection (iv) to the extent that the General Partner reasonably determines
that an adjustment pursuant to subsection (ii) above is necessary or appropriate
in connection with a transaction that would otherwise result in an adjustment
pursuant to this subsection (iv).

 

(v)                                 If the Gross Asset Value of a Partnership
asset has been determined or adjusted pursuant to subsection (i),
subsection (ii) or subsection (iv) above, 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 (a) a Partner or (b) an Assignee that owns a Partnership
Unit.

 

“Incapacity” or “Incapacitated” means, (i) as to any Partner who is an
individual, death, total physical disability or entry by a court of competent
jurisdiction adjudicating such Partner incompetent to manage his or her person
or his or her estate; (ii) as to any Partner that is a corporation or limited
liability company, the filing of a certificate of dissolution, or its
equivalent, for the corporation or the revocation of its charter; (iii) as to
any Partner that is a partnership, the dissolution and commencement of winding
up of the partnership; (iv) as to any Partner that is an estate, the
distribution by the fiduciary of the estate’s entire interest in the
Partnership; (v) as to any trustee of a trust that 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 of or against such Partner 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 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 stayed within ninety
(90) days of such appointment, or (h) an appointment referred to in
clause (g) above is not vacated within ninety (90) days after the expiration of
any such stay.

 

“Indemnitee” means (i) any Person made, or threatened to be made, a party to a
proceeding by reason of its status as (A) the General Partner or the Special
Limited Partner or (B) a trustee, officer or employee of the General Partner, a
director, officer or employee of the Special Limited Partner or an employee of
the Partnership and (ii) such other Persons (including Affiliates, employees or
agents of the General Partner, the Special Limited Partner or the Partnership)
as the General Partner may designate from time to time (whether before or after
the event giving rise to potential liability).

 

“IRS” means the United States Internal Revenue Service.

 

“Lead Tendering Party” has the meaning set forth in Section 15.1.H hereof.

 

“Limited Partner” means the Special Limited Partner and any other Person that
is, from time to time, admitted to the Partnership as a limited partner pursuant
to the Act and this Agreement, and any Substituted Limited Partner or Additional
Limited Partner, each shown as such in the books and records of the Partnership,
in each case, that has not ceased to be a limited partner of the Partnership
pursuant to the Act and this Agreement, in such Person’s capacity as a limited
partner of the Partnership.

 

“Liquidating Event” has the meaning set forth in Section 13.1 hereof.

 

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“Liquidator” has the meaning set forth in Section 13.2.A hereof.

 

“Majority in Interest of the Limited Partners” means Partners (excluding, at any
time that there are any other Limited Partners, the General Partner, the Special
Limited Partner and any Controlled Entity of either of them) entitled to vote on
or consent to any matter holding more than fifty percent (50%) of all
outstanding Partnership Units held by all Partners (excluding, at any time that
there are any other Limited Partners, the General Partner, the Special Limited
Partner and any Controlled Entity of either of them) entitled to vote on or
consent to such matter.

 

“Majority in Interest of the Partners” means Partners (including the General
Partner, the Special Limited Partner and any Controlled Entity of either of
them) entitled to vote on or consent to any matter holding more than fifty
percent (50%) of all outstanding Partnership Units held by all Partners
(including the General Partner, the Special Limited Partner and any Controlled
Entity of either of them) entitled to vote on or consent to such matter.

 

“Net Income” or “Net Loss” means, for each Partnership Year of the Partnership,
an amount equal to the Partnership’s taxable income or loss for such year,
determined in accordance with Code Section 703(a) (for this purpose, all items
of income, gain, loss or 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 (or subtracted from, as the case may be) such taxable
income (or loss);

 

(ii)                                  Any expenditure of the Partnership
described in Code Section 705(a)(2)(B) or treated as a Code
Section 705(a)(2)(B) expenditure 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 (or added to, as the case may be) such taxable
income (or loss);

 

(iii)                               In the event the Gross Asset Value of any
Partnership asset is adjusted pursuant to subsection (ii) or subsection (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;

 

(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 that would otherwise be taken into account in
computing such taxable income or loss, there shall be taken into account
Depreciation for such Partnership Year;

 

(vi)                              To the extent that 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 item that is specially allocated
pursuant to Section 6.3 hereof shall not be taken into

 

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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 hereof shall be determined by applying rules analogous
to those set forth in this definition of “Net Income” or “Net Loss.”

 

“Net Proceeds” has the meaning set forth in Section 15.1.H hereof.

 

“New Partnership Audit Procedures” means Subchapter C of Chapter 63 of Subtitle
F of the Code, as modified by Section 1101 of the Bipartisan Budget Act of 2015,
Pub. L. No. 114-74, and any successor statutes thereto or Regulations
promulgated thereunder.

 

“New Securities” means (i) any rights, options, warrants or convertible or
exchangeable securities that entitle the holder thereof to subscribe for or
purchase, convert such securities into or exchange such securities for, REIT
Shares or Preferred Shares, excluding Preferred Shares and grants under the
Stock Option Plans, or (ii) any Debt issued by the Special Limited Partner that
provides any of the rights described in clause (i).

 

“Nonrecourse Deductions” has 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” has 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 attached to this Agreement.

 

“Offered Shares” has the meaning set forth in Section 15.1.H hereof

 

“Offering Units” has the meaning set forth in Section 15.1.H hereof.

 

“Optionee” means a Person to whom a stock option is granted under any Stock
Option Plan.

 

“Ownership Limit” means the restrictions on ownership and transfer of stock of
the Special Limited Partner imposed under the Charter.

 

“Partner” means the 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” has the meaning set forth in Regulations
Section 1.704-2(b)(4).

 

“Partner Nonrecourse Deductions” has the meaning set forth in Regulations
Section 1.704-2(i)(1), 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)(1).

 

“Partnership” means CyrusOne, LP, the limited partnership formed and continued
under the Act and pursuant to this Agreement, and any successor thereto.

 

“Partnership Common Unit” means a fractional share of the Partnership Interests
issued pursuant to Sections 4.1 and 4.2 hereof, but does not include any
Partnership Junior Unit, Partnership Preferred Unit or any other Partnership
Unit specified in a Partnership Unit Designation as being other than a
Partnership Common Unit.

 

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“Partnership Employee” means an employee of the Partnership or an employee of a
Subsidiary of the Partnership, if any.

 

“Partnership Equivalent Units” means, with respect to any class or series of
Capital Shares, Partnership Units with preferences, conversion and other rights
(other than voting rights), restrictions, limitations as to dividends and other
distributions, qualifications and terms and conditions of redemption that are
substantially the same as (or correspond to) the preferences, conversion and
other rights, restrictions, limitations as to distributions, qualifications and
terms and conditions of redemption of such Capital Shares as appropriate to
reflect the relative rights and preferences of such Capital Shares as to the
REIT Shares and the other classes and series of Capital Shares as such
Partnership Equivalent Units would have as to Partnership Common Units and the
other classes and series of Partnership Units corresponding to the other classes
of Capital Shares, but not as to matters such as voting that are not applicable
to the Partnership.  For the avoidance of doubt, the voting rights, redemption
rights and rights to Transfer Partnership Equivalent Units need not be similar
to the rights of the corresponding class or series of Capital Shares, provided,
however, with respect to redemption rights, the terms of Partnership Equivalent
Units must be such so that the Partnership complies with Section 4.7.B of this
Agreement.

 

“Partnership Interest” means an ownership interest in the Partnership held by a
Limited Partner, the General Partner or any other Holder 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.  There may be one or
more classes or series of Partnership Interests; however, notwithstanding that
the General Partner, the Special Limited Partner and any other Limited Partner
may have different rights and privileges as specified in this Agreement
(including differences in rights and privileges with respect to their
Partnership Interests), the Partnership Interest held by the General Partner,
the Special Limited Partner or any other Partner and designated as being of a
particular class or series shall not be deemed to be a separate class or series
of Partnership Interest from a Partnership Interest having the same designation
as to class and series that is held by any other Partner solely because such
Partnership Interest is held by the General Partner, the Special Limited Partner
or any other Partner having different rights and privileges as specified under
this Agreement.  A Partnership Interest may be expressed as a number of
Partnership Common Units, Partnership Preferred Units or other Partnership
Units.

 

“Partnership Junior Unit” means a fractional share of the Partnership Interests
of a particular class or series that the General Partner has authorized pursuant
to Section 4.2 hereof that has distribution rights, or rights upon liquidation,
winding up and dissolution, that are inferior or junior to the Partnership
Common Units.

 

“Partnership Minimum Gain” has 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 Preferred Unit” means a fractional share of the Partnership
Interests of a particular class or series that the General Partner has
authorized pursuant to Section 4.1 or Section 4.2 or Section 4.3 hereof that has
distribution rights, or rights upon liquidation, winding up and dissolution,
that are superior or prior to the Partnership Common Units.

 

“Partnership Record Date” means the record date established by the General
Partner for the purpose of determining the Partners entitled to notice of or to
vote at any meeting of Partners or to consent to any matter, or to receive any
distribution or the allotment of any other rights, or in order to make a
determination of Partners for any other proper purpose, which, in the case of a
record date fixed for the determination of Partners entitled to receive any
distribution, shall (unless otherwise determined by the General Partner)
generally be the same as the record date established by the Special Limited
Partner for a distribution to its stockholders of some or all of its portion of
such distribution.

 

“Partnership Unit” means a Partnership Common Unit, a Partnership Preferred
Unit, a Partnership Junior Unit or any other fractional share of the Partnership
Interests that the General Partner has authorized pursuant to Section 4.1 or
Section 4.2 or Section 4.3 hereof.

 

“Partnership Unit Designation” has the meaning set forth in Section 4.2 hereof.

 

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“Partnership Year” means the fiscal year of the Partnership, which shall be the
calendar year.

 

“Percentage Interest” means, with respect to each Holder, as to any class or
series of Partnership Interests, the fraction, expressed as a percentage, the
numerator of which is the aggregate number of Partnership Units of such class or
series held by such Holder and the denominator of which is the total number of
Partnership Units of such class or series held by all Holders.  If not otherwise
specified, “Percentage Interest” shall be deemed to refer to Partnership Common
Units.

 

“Permitted Transfer” means a Transfer by a Limited Partner of all or part of its
Partnership Interest to any Family Member, Controlled Entity or Affiliate of
such Partner, or to a Charity.

 

“Person” means an individual or a corporation, partnership, trust,
unincorporated organization, association, limited liability company or other
entity.

 

“Preferred Share” means a share of stock of the Special Limited Partner now or
hereafter authorized or reclassified that has dividend rights, or rights upon
liquidation, winding up and dissolution, that are superior or prior to the REIT
Shares.

 

“Pricing Agreements” has the meaning set forth in Section 15.1.H hereof.

 

“Properties” means any assets and property of the Partnership such as, but not
limited to, interests in real property and personal property, including, without
limitation, fee interests, interests in ground leases, easements and rights of
way, interests in limited liability companies, joint ventures or partnerships,
interests in mortgages, and Debt instruments as the Partnership may hold from
time to time and “Property” means any one such asset or property.

 

“Publicly Traded” means having common equity securities listed or admitted to
trading on any U.S. national securities exchange.

 

“QRS” means a “qualified REIT subsidiary” within the meaning of Code
Section 856(i)(2).

 

“Qualified DRIP”  means a dividend reinvestment plan of the Special Limited
Partner that permits participants to acquire REIT Shares using the proceeds of
dividends paid by the Special Limited Partner; provided, however, that if such
shares are offered at a discount, such discount must (i) be designed to pass
along to the stockholders of the Special Limited Partner the savings enjoyed by
the Special Limited Partner in connection with the avoidance of stock issuance
costs, and (ii) not exceed 5% of the value of a REIT Share as computed under the
terms of such dividend reinvestment plan.

 

“Qualified Transferee” means an “accredited investor,” as defined in Rule 501
promulgated under the Securities Act.

 

“Qualifying Party” means (a) a Limited Partner, (b) an Additional Limited
Partner, (c) an Assignee who is the transferee of a Limited Partner’s
Partnership Interest in a Permitted Transfer, or (d) a Person who is the
transferee of a Limited Partner’s Partnership Interest in a Permitted Transfer;
provided, however, that a Qualifying Party shall not include the General Partner
or the Special Limited Partner.

 

“Redemption” has the meaning set forth in Section 15.1.A hereof.

 

“Register” has the meaning set forth in Section 4.1 hereof.

 

“Regulations” means the income tax regulations under the Code, whether such
regulations are in proposed, temporary or final form, as such regulations may be
amended from time to time (including corresponding provisions of succeeding
regulations).

 

“Regulatory Allocations” has the meaning set forth in Section 6.3B(viii) hereof.

 

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“REIT” means a real estate investment trust qualifying under Code Section 856.

 

“REIT Available Cash” means, as of any date of determination, all amounts which
would be available for distribution to the holders of REIT Shares (calculated in
a manner substantially similar to the manner in which the Partnership calculates
Available Cash and without regard to any distributions from the Partnership to
be made, or which have been made, to the General Partner and the Special Limited
Partner hereunder and without regard to any restriction on distribution imposed
on the General Partner by any third party).

 

“REIT Partner” means (a) the Special Limited Partner or any Affiliate of the
Special Limited Partner to the extent such Person has in place an election to
qualify as a REIT and (b) any QRS of any such Person.

 

“REIT Payment” has the meaning set forth in Section 15.12 hereof.

 

“REIT Requirements” means the requirements for qualifying as a REIT under the
Code and Regulations (the “REIT Requirements”).

 

“REIT Share” means a share of common stock of the Special Limited Partner, $0.01
par value per share (but shall not include any additional series or class of the
Special Limited Partner’s common stock created after the date of this
Agreement).

 

“REIT Shares Amount” means a number of REIT Shares equal to the product of
(a) the number of Tendered Units and (b) the Adjustment Factor; provided,
however, that, in the event that the Special Limited Partner issues to all
holders of REIT Shares as of a certain record date rights, options, warrants or
convertible or exchangeable securities entitling the Special Limited Partner’s
stockholders to subscribe for or purchase REIT Shares, or any other securities
or property (collectively, the “Rights”), with the record date for such Rights
issuance falling within the period starting on the date of the Notice of
Redemption and ending on the day immediately preceding the Specified Redemption
Date, which Rights will not be distributed before the relevant Specified
Redemption Date, then the REIT Shares Amount shall also include such Rights that
a holder of that number of REIT Shares would be entitled to receive, expressed,
where relevant hereunder, as a number of REIT Shares determined by the General
Partner.

 

“Related Party” means, with respect to any Person, any other Person to whom
ownership of shares of the Special Limited Partner’s stock would be attributed
by the first such Person under Code Section 544 (as modified by Code
Section 856(h)(1)(B)).

 

“Rights” has the meaning set forth in the definition of “REIT Shares Amount.”

 

“SDAT” means the State Department of Assessments and Taxation of Maryland.

 

“SEC” means the Securities and Exchange Commission.

 

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations of the SEC promulgated thereunder.

 

“Single Funding Notice” has the meaning set forth in Section 15.1.H hereof.

 

“Special Redemption” has the meaning set forth in Section 15.1.A hereof.

 

“Specified Partnership Units” means with respect to each Excluded Property, the
amount of Partnership Common Units and/or Partnership Preferred Units (as the
case may be) which would have been issued to the Special Limited Partner,
pursuant to Section 4.3.B and 4.2 hereof, if the Special Limited Partner had
contributed such Excluded Property on the date that such asset was acquired by
the Special Limited Partner or a wholly-owned Subsidiary of the Special Limited
Partner, in exchange for Partnership Units equal in value to the fair market
value of such Excluded Property as of such date.

 

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“Specified Redemption Date” means the tenth (10th) Business Day after the
receipt by the General Partner of a Notice of Redemption; provided, however,
that no Specified Redemption Date with respect to any Partnership Common Units
shall occur during the Twelve-Month Period applicable to such Partnership Common
Units (except pursuant to a Special Redemption); and provided, further, that, if
the General Partner and the Special Limited Partner elect a Stock Offering
Funding pursuant to Section 15.1.H, such Specified Redemption Date shall be
deferred until the next Business Day following the date of the closing of the
Stock Offering Funding.

 

“Stock Offering Funding” has the meaning set forth in Section 15.1.H hereof.

 

“Stock Offering Funding Amount” has the meaning set forth in Section 15.1.H
hereof.

 

“Stock Option Plans” means any stock option plan now or hereafter adopted by the
Partnership or the Special Limited Partner.

 

“Subsidiary” means, with respect to any Person, any corporation 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.

 

“Substituted Limited Partner” means a Person who is admitted as a Limited
Partner to the Partnership pursuant to Section 11.4 hereof.

 

“Successor Shares Amount” has the meaning set forth in Section 11.7 hereof.

 

“Surviving Partnership” has the meaning set forth in Section 11.7 hereof.

 

“Tax Items” has the meaning set forth in Section 6.4.A hereof.

 

“Tendered Units” has the meaning set forth in Section 15.1.A hereof.

 

“Tendering Party” has the meaning set forth in Section 15.1.A hereof.

 

“Termination Transaction” means any direct or indirect Transfer of all or any
portion of the Special Limited Partner’s Partnership Interest or its interest in
the General Partner in connection with, (a) a merger, consolidation or other
combination involving the Special Limited Partner or the General Partner, on the
one hand, and any other Person, on the other hand, (b) a sale, lease, exchange
or other transfer of all or substantially all of the assets of the Special
Limited Partner not in the ordinary course of its business, whether in a single
transaction or a series of related transactions, (c) the adoption of any plan of
liquidation or dissolution of the Special Limited Partner or the General
Partner, or (d) a direct or indirect Transfer of all or any portion of the
Special Limited Partner’s Partnership Interest or its interest in the General
Partner, other than a Transfer effected in accordance with Section 11.2.B.

 

“Transaction Consideration” has the meaning set forth in Section 11.7 hereof.

 

“Transfer” means any sale, assignment, bequest, conveyance, devise, gift
(outright or in trust), pledge, encumbrance, hypothecation, mortgage, exchange,
transfer or other disposition or act of alienation, whether voluntary or
involuntary or by operation of law; provided, however, that when the term is
used in Article 11 and Section 13.7 hereof, “Transfer” does not include (a) any
Redemption of Partnership Common Units by the Partnership, or acquisition of
Tendered Units by the Special Limited Partner, pursuant to Section 15.1 hereof
or (b) any redemption of Partnership Units pursuant to any Partnership Unit
Designation.  The terms “Transferred” and “Transferring” have correlative
meanings.

 

“Twelve-Month Period” means as to any Partnership Interest, a twelve-month
period ending on the day before the first (1st) anniversary of a Qualifying
Party’s first becoming a Holder of such Partnership Interest; provided, however,
that the General Partner may, by written agreement with a Qualifying Party,
shorten or lengthen

 

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the first Twelve-Month Period to a period that is shorter or longer than twelve
(12) months with respect to a Qualifying Party.

 

“Valuation Date” means the date of receipt by the General Partner of a Notice of
Redemption pursuant to Section 15.1 herein, or such other date as specified
herein, or, if such date is not a Business Day, the immediately preceding
Business Day.

 

“Value” means, on any Valuation Date with respect to a REIT Share, the average
of the daily Market Prices for ten (10) consecutive trading days immediately
preceding the Valuation Date (except that the Market Price for the trading day
immediately preceding the date of exercise of a stock option under any Stock
Option Plans shall be substituted for such average of daily market prices for
purposes of Section 4.4 hereof).  The term “Market Price” on any date means,
with respect to any REIT Share, the last sale price for a REIT Share, regular
way, or, in case no such sale takes place on such day, the average of the
closing bid and asked prices, regular way, for a REIT Share, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on The NASDAQ Stock Market or, if
the REIT Shares are not listed or admitted to trading on The NASDAQ Stock
Market, as reported on the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the REIT Shares are listed or admitted to trading or, if such REIT
Shares are not listed or admitted to trading on any national securities
exchange, the last quoted price, or, if not so quoted, the average of the high
bid and low asked prices in the over-the-counter market, as reported by the
principal automated quotation system that may then be in use or, if the REIT
Shares are not quoted by any such system, the average of the closing bid and
asked prices as furnished by a professional market maker making a market in REIT
Shares selected by the General Partner or, in the event that no trading price is
available for REIT Shares, the fair market value of a REIT Share, as determined
in good faith by the General Partner.  In the event that the REIT Shares Amount
includes Rights (as defined in the definition of “REIT Shares Amount”) that a
holder of the REIT Shares would be entitled to receive, then the 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.

 

“Withdrawing Partners” has the meaning set forth in Section 15.1.H hereof.

 

ARTICLE 2
ORGANIZATIONAL MATTERS

 

Section 2.1                                    Formation.  The Partnership is a
limited partnership heretofore formed and continued pursuant to the provisions
of the Act and now upon the terms and subject to the conditions set forth in
this Agreement.  Except as expressly provided herein to the contrary, 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 “CyrusOne LP.”  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,” “LP,” “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 may change the name
of the Partnership at any time and from time.

 

Section 2.3                                    Principal Office and Resident
Agent.  The address of the principal office of the Partnership in the State of
Maryland is located at c/o CSC-Lawyer’s Incorporating Service Company, 7 St.
Paul Street, Suite 820, Baltimore, Maryland 21202 and the name and address of
the resident agent of the Partnership in the State of Maryland are CSC-Lawyer’s
Incorporating Service Company, 7 St. Paul Street, Suite 820, Baltimore, Maryland
21202, or such other principal office and resident agent as the General Partner
may from time to time designate.  The Partnership may maintain offices at such
other place or places within or outside the State of Maryland as the General
Partner may approve.

 

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Section 2.4                                    Power of Attorney.

 

A.                                    Each Limited Partner and Assignee hereby
irrevocably constitutes and appoints the General Partner, any Liquidator, and
the 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:

 

(1)                                 execute, swear to, seal, 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, supplements or restatements thereof)
that the General Partner, any Liquidator, or the authorized officers or
attorneys-in-fact of each 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 to the extent provided by applicable law) in the State of Maryland and
in all other jurisdictions in which the Partnership may conduct business or own
property; (b) all instruments that the General Partner, any Liquidator, or the
authorized officers or attorneys-in-fact of each 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, any Liquidator, or the authorized officers
or attorneys-in-fact of each 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
conveyances and other instruments or documents that the General Partner, any
Liquidator, or the authorized officers or attorneys-in-fact of each deems
appropriate or necessary to reflect the distribution or exchange of assets of
the Partnership pursuant to the terms of this Agreement; (e) all instruments
relating to the admission, acceptance, withdrawal, removal or substitution of
any Partner pursuant to the terms of this Agreement, the Transfer of any
Partnership Interest or the Capital Contribution of any Holder; and (f) all
certificates, documents and other instruments relating to the determination of
the rights, preferences and privileges relating to Partnership Interests; and

 

(2)                                 execute, swear to, acknowledge and file all
ballots, consents, approvals, waivers, certificates and other instruments the
General Partner or any Liquidator determines are necessary or desirable to make,
evidence, give, confirm or ratify any vote, consent, approval, agreement or
other action that is made or given by the Partners hereunder or is consistent
with the terms 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 Section 14.2
hereof 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 special power coupled with an interest, in
recognition of the fact that each of the Limited Partners and Assignees will be
relying upon the power of the General Partner or the 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 or the Transfer of all or any
portion of such Person’s Partnership Units or Partnership Interest (as the case
may be) and shall extend to such Person’s heirs, successors, assigns and
personal representatives.  Each such Limited Partner and Assignee hereby agrees
to be bound by any representation made by the General Partner or the Liquidator,
acting in good faith pursuant to such power of attorney; and each such Limited
Partner and Assignee hereby waives any and all defenses that may be available to
contest, negate or disaffirm the action of the General Partner or the
Liquidator, taken in good faith under such power of attorney.  Each Limited
Partner and Assignee shall execute and deliver to the General Partner or the
Liquidator, within fifteen (15) days after receipt of the General Partner’s or
the 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.  Notwithstanding anything else set forth in this Section 2.4.B, no
Limited Partner shall incur any personal liability for any action of the General
Partner or the Liquidator taken under such power of attorney.

 

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Section 2.5                                    Term.  The term of the
Partnership commenced on July 31, 2012, the date that the original Certificate
was accepted for record by the SDAT in accordance with the Act, and shall
continue indefinitely unless the Partnership is dissolved sooner pursuant to the
provisions of Article 13 hereof or as otherwise provided by law.

 

ARTICLE 3
PURPOSE

 

Section 3.1                                    Purpose and Business.  The
purpose and nature of the Partnership is to conduct any business, enterprise or
activity permitted by or under the Act, including, but not limited to, (i) to
conduct the business of ownership, construction, reconstruction, development,
redevelopment, alteration, improvement, maintenance, operation, sale, leasing,
transfer, encumbrance, conveyance and exchange of the Properties, (ii) to
acquire and invest in any securities and/or loans relating to the Properties,
(iii) to enter into any partnership, joint venture, business trust arrangement,
limited liability company or other similar arrangement to engage in any business
permitted by or under the Act, or to own interests in any entity engaged in any
business permitted by or under the Act, (iv) to conduct the business of
providing property and asset management and brokerage services, whether directly
or through one or more partnerships, joint ventures, Subsidiaries, business
trusts, limited liability companies or similar arrangements, and (v) to do
anything necessary or incidental to the foregoing.  The Partnership shall have
all powers necessary or desirable to accomplish the purposes enumerated.  In
connection with the foregoing, the Partnership shall have full power and
authority to enter into, perform and carry out contracts of any kind, to borrow
and lend money and to issue evidence of indebtedness, whether or not secured by
mortgage, deed of trust, pledge or other lien and, directly or indirectly, to
acquire and construct additional Properties necessary, useful or desirable in
connection with its business.

 

Section 3.2                                    Powers.  The Partnership shall
have the power 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, to borrow and lend money and to
issue evidence of indebtedness, whether or not secured by mortgage, deed of
trust, pledge or other lien, to acquire, own, manage, improve and develop real
property and lease, sell, transfer and dispose of real property.

 

Section 3.3                                    Partnership Only for Purposes
Specified.  The Partnership is a limited partnership formed pursuant to the Act,
and this Agreement shall not be deemed to create a company, venture or
partnership between or among the Partners or any other Persons with respect to
any activities whatsoever other than the activities specified in Section 3.1
hereof; however, to the extent applicable, the Partnership is a “partnership at
will” (and is not a partnership formed for a definite term or a particular
undertaking) within the meaning of the Maryland Revised Uniform Partnership
Act.  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.

 

Section 3.4                                    Representations and Warranties by
the Partners.

 

A.                                    Each Partner that is an individual
(including, without limitation, each Additional Limited Partner or Substituted
Limited Partner as a condition to becoming an Additional Limited Partner or a
Substituted Limited Partner) represents and warrants to, and covenants with,
each other Partner that (i) 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 material agreement by which such Partner
or any of such Partner’s property is bound, or any statute, regulation, order or
other law to which such Partner is subject, (ii) such Partner is neither a
“foreign person” within the meaning of Code Section 1445(f) nor a “foreign
partner” within the meaning of Code Section 1446(e), (iii) such Partner does
not, and for so long as it is a Partner will not, own, directly or indirectly,

 

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(a) five percent (5%) or more of the total combined voting power of all classes
of stock entitled to vote, or five percent (5%) or more of the total number of
shares of all classes of stock, of any corporation that is a tenant of either
(I) the Special Limited Partner or any QRS, (II) the Partnership or (III) any
partnership, venture or limited liability company of which the Special Limited
Partner, any QRS, with respect to the Special Limited Partner, or the
Partnership is a member or (b) an interest of five percent (5%) or more in the
assets or net profits of any tenant of either (I) the Special Limited Partner or
any QRS, (II) the Partnership or (III) any partnership, venture, or limited
liability company of which the Special Limited Partner, any QRS, with respect to
the Special Limited Partner, or the Partnership is a member and (iv) this
Agreement is binding upon, and enforceable against, such Partner in accordance
with its terms.  Notwithstanding the foregoing, each Partner may exceed any of
the five percent (5%) limits set forth in clause (iii) of the immediately
preceding sentence; provided that the Partner obtains the written consent of the
General Partner prior to exceeding any such limits; provided, further, that in
no event shall the Partner own, directly or indirectly, more than ten percent
(10%) of the stock described in clause (iii)(a) of the immediately preceding
sentence or more than ten percent (10%) of the assets described in
clause (iii)(b) of the immediately preceding sentence.

 

B.                                    Each Partner that is not an individual
(including, without limitation, each Additional Limited Partner or Substituted
Limited Partner as a condition to becoming an Additional Limited Partner or a
Substituted Limited Partner) represents and warrants to, and covenants with,
each other Partner that (i) 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 partnership or operating agreement, trust
agreement, charter or bylaws (as the case may be), any material agreement by
which such Partner or any of such Partner’s properties or any of its partners,
members, 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, members, 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 Code Section 1445(f) nor a “foreign partner” within the
meaning of Code Section 1446(e), (iv) such Partner does not, and for so long as
it is a Partner will not, own, directly or indirectly, (a) five percent (5%) or
more of the total combined voting power of all classes of stock entitled to
vote, or five percent (5%) or more of the total number of shares of all classes
of stock, of any corporation that is a tenant of either (I) the Special Limited
Partner or any QRS, with respect to the Special Limited Partner, (II) the
Partnership or (III) any partnership, venture or limited liability company of
which the Special Limited Partner, any Special Limited Partner, any QRS, with
respect to the Special Limited Partner, or the Partnership is a member or (b) an
interest of five percent (5%) or more in the assets or net profits of any tenant
of either (I) the Special Limited Partner, or any QRS with respect to the
Special Limited Partner, (II) the Partnership or (III) any partnership, venture
or limited liability company for which the Special Limited Partner, any Special
Limited Partner, any “QRS, with respect to the Special Limited Partner, or the
Partnership is a member and (v) this Agreement is binding upon, and enforceable
against, such Partner in accordance with its terms.  Notwithstanding the
foregoing, each Partner may exceed any of the five percent (5%) limits set forth
in clause (iv) of the immediately preceding sentence; provided that any Partner
other than a Permitted Transferee obtains the written consent of the General
Partner prior to exceeding any such limits; provided, further, that in no event
shall any Partner (including any Permitted Transferee) own, directly or
indirectly, more than ten percent (10%) of the stock described in
clause (iv) (a) of the immediately preceding sentence or more than ten percent
(10%) of the assets described in clause (iv) (b) of the immediately preceding
sentence.

 

C.                                    Each Partner (including, without
limitation, each Substituted Limited Partner, as a condition to becoming a
Substituted Limited Partner) represents and warrants that it is an “accredited
investor” as defined in Rule 501 promulgated under the Securities Act and
represents, warrants and agrees that it has acquired and continues to hold its
interest in the Partnership for its own account for investment purposes only and
not for the purpose of, or with a view toward, the resale or distribution of all
or any part thereof, and not 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 (1) it is a sophisticated investor, able and accustomed to handling
sophisticated financial matters for itself, particularly real estate
investments, (2) it has a sufficiently high net worth that it does not
anticipate a need for the funds that it has invested in the Partnership in what
it understands to be a highly speculative and illiquid investment and (3) it has
not had or been subject to any of the items listed in Rule 506(d) of Regulation
D of the Securities Act.

 

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D.                                    The representations and warranties
contained in Sections 3.4.A, 3.4.B and 3.4.C hereof shall survive the execution
and delivery of this Agreement by each Partner (and, in the case of an
Additional Limited Partner or a Substituted Limited Partner, the admission of
such Additional Limited Partner or Substituted Limited Partner as a Limited
Partner in the Partnership) and the dissolution, liquidation and termination of
the Partnership.

 

E.                                     Each Partner (including, without
limitation, each Substituted Limited Partner as a condition to becoming a
Substituted Limited 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, that 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.

 

F.                                      Notwithstanding the foregoing, the
General Partner may permit the modification of any of the representations and
warranties contained in Sections 3.4.A, 3.4.B and 3.4.C above as applicable to
any Partner (including, without limitation any Additional Limited Partner or
Substituted Limited Partner or any transferee of either) provided that such
representations and warranties, as modified, shall be set forth in either (i) a
Partnership Unit Designation applicable to the Partnership Units held by such
Partner or (ii) a separate writing addressed to the Partnership and the General
Partner.

 

ARTICLE 4
CAPITAL CONTRIBUTIONS

 

Section 4.1                                    Capital Contributions of the
Partners.  The Partners have heretofore made Capital Contributions to the
Partnership.  Except as provided by law or in Section 4.2, 4.3, or 10.4 hereof,
the Partners shall have no obligation or, except with the prior written consent
of the General Partner, right to make any Capital Contributions or loans to the
Partnership.  The General Partner shall cause to be maintained in the principal
business office of the Partnership, or such other place as may be determined by
the General Partner, the books and records of the Partnership, which shall
include, among other things, a register containing the name, address, and number
of Partnership Units of each Partner, and such other information as the General
Partner may deem necessary or desirable (the “Register”).  The Register shall
not be deemed part of this Agreement.  The General Partner shall from time to
time update the Register as necessary to accurately reflect the information
therein, including as a result of any sales, exchanges or other Transfers, or
any redemptions, issuances or similar events involving Partnership Units.  Any
reference in this Agreement to the Register shall be deemed a reference to the
Register as in effect from time to time.  Subject to the terms of this
Agreement, the General Partner may take any action authorized hereunder in
respect of the Register without any need to obtain the consent of any other
Partner.  No action of any Limited Partner shall be required to amend or update
the Register.  Except as required by law, no Limited Partner shall be entitled
to receive a copy of the information set forth in the Register relating to any
Partner other than itself.

 

Section 4.2                                    Issuances of Additional
Partnership Interests.  Subject to the rights of any Holder of any Partnership
Interest set forth in a Partnership Unit Designation:

 

A.                                    General.  The General Partner is hereby
authorized to cause the Partnership to issue additional Partnership Interests,
in the form of Partnership Units, for any Partnership purpose, at any time or
from time to time, to the Partners (including the General Partner and the
Special Limited Partner) or to other Persons, and to admit such Persons as
Additional Limited Partners, for such consideration and on such terms and
conditions as shall be established by the General Partner, all without the
approval of any Limited Partner or any other Person.  Without limiting the
foregoing, the General Partner is expressly authorized to cause the Partnership
to issue Partnership Units (i) upon the conversion, redemption or exchange of
any Debt, Partnership Units, or other securities issued by the Partnership,
(ii) for less than fair market value, (iii) for no consideration, (iv) in
connection with any merger of any other Person into the Partnership, or (v) upon
the contribution of property or assets to the Partnership.  Any additional
Partnership Interests may be issued in one or more classes, or one or more
series of any of such classes, with such designations, preferences, conversion
or other rights, voting powers, restrictions, limitations as to distributions,
qualifications and terms and conditions of redemption (including, without
limitation, rights that may

 

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be senior or otherwise entitled to preference over existing Partnership
Interests) as shall be determined by the General Partner, without the approval
of any Limited Partner or any other Person, and set forth in a written document
thereafter attached to and made an exhibit to this Agreement, which exhibit
shall be an amendment to this Agreement and shall be incorporated herein by this
reference (each, a “Partnership Unit Designation”).  Without limiting the
generality of the foregoing, the General Partner shall have authority to specify
the allocations of items of Partnership income, gain, loss, deduction and credit
to each such class or series of Partnership Interests.  Except to the extent
specifically set forth in any Partnership Unit Designation, a Partnership
Interest of any class or series other than a Partnership Common Unit shall not
entitle the holder thereof to vote on, or consent to, any matter.  Upon the
issuance of any additional Partnership Interest, the General Partner shall amend
the Register and the books and records of the Partnership as appropriate to
reflect such issuance.

 

B.                                    Issuances to the General Partner or
Special Limited Partner.  No additional Partnership Units shall be issued to the
General Partner or the Special Limited Partner unless (i) the additional
Partnership Units are issued to all Partners holding Partnership Common Units in
proportion to their respective Percentage Interests in the Partnership Common
Units, (ii) (a) the additional Partnership Units are (x) Partnership Common
Units issued in connection with an issuance of REIT Shares, or (y) Partnership
Equivalent Units (other than Partnership Common Units) issued in connection with
an issuance of Preferred Shares, New Securities or other interests in the
Special Limited Partner (other than REIT Shares), and (b) the Special Limited
Partner contributes to the Partnership, directly or indirectly (including
contributing to the General Partner and the General Partner contributing to the
Partnership), such REIT Shares, Preferred Shares, New Securities or other
interests in the Special Limited Partner or the cash proceeds or other
consideration received in connection with the issuance of such REIT Shares,
Preferred Shares, New Securities or other interests in the Special Limited
Partner, (iii) the additional Partnership Units are issued upon the conversion,
redemption or exchange of Debt, Partnership Units or other securities issued by
the Partnership, (iv) such Partnership Units are issued to the General Partner
or the Special Limited Partner in exchange for the consideration received or to
be received by the General Partner or the Special Limited Partner, as
applicable, in exchange for such Partnership Units, or (v) the additional
Partnership Units are issued pursuant to Section 4.3.B, Section 4.3.E,
Section 4.4, Section 4.5 or Section 4.9.

 

C.                                    No Preemptive Rights.  Except as expressly
provided in this Agreement or in any Partnership Unit Designation, no Person,
including, without limitation, any Partner or Assignee, shall have any
preemptive, preferential, participation or similar right or rights to subscribe
for or acquire any Partnership Interest.

 

Section 4.3                                    Additional Funds 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 or development of additional
Properties, for the redemption of Partnership Units or for such other purposes
as the General Partner may determine.  Additional Funds may be obtained 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 without the approval of
any Limited Partner or any other Person.

 

B.                                    Additional Capital Contributions.  The
General Partner, on behalf of the Partnership, may obtain any Additional Funds
by accepting Capital Contributions from any Partners or other Persons, including
the General Partner or the Special Limited Partner.  In connection with any such
Capital Contribution (of cash, securities or property), the General Partner is
hereby authorized to cause the Partnership from time to time to issue additional
Partnership Units (as set forth in Section 4.2 above) in consideration therefor
and the Percentage Interests of the General Partner and the Limited Partners
shall be adjusted to reflect the issuance of such additional Partnership Units.

 

C.                                    Loans by Third Parties.  The General
Partner, on behalf of the Partnership, may obtain any Additional Funds by
causing the Partnership to incur Debt to any Person (other than, except as
contemplated in Section 4.3.D, the General Partner or the Special Limited
Partner) upon such terms as the General Partner determines appropriate,
including making such Debt convertible, redeemable or exchangeable for
Partnership Units; provided, however, that the Partnership shall not incur any
such Debt if any Partner would be personally liable for the repayment of such
Debt (unless such Partner otherwise agrees).

 

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D.                                    General Partner and Special Limited
Partner Loans.  The General Partner, on behalf of the Partnership, may obtain
any Additional Funds by causing the Partnership to incur Debt with the General
Partner and/or the Special Limited Partner (each, a “General Partner Loan”) if
(i) such Debt is, to the extent permitted by law, on substantially the same
terms and conditions (including interest rate, repayment schedule, and
conversion, redemption, repurchase and exchange rights) as Funding Debt incurred
by the General Partner or the Special Limited Partner, as applicable, the net
proceeds of which are loaned to the Partnership to provide such Additional
Funds, or (ii) such Debt is on terms and conditions no less favorable to the
Partnership than would be available to the Partnership from any third party;
provided, however, that the Partnership shall not incur any such Debt if any
Limited Partner would be personally liable for the repayment of such Debt
(unless such Partner otherwise agrees).

 

E.                                     Issuance of Securities by the Special
Limited Partner.  The Special Limited Partner shall not issue any additional
REIT Shares, Preferred Shares or New Securities unless the Special Limited
Partner contributes the cash proceeds or other consideration received from the
issuance of such additional REIT Shares, Preferred Shares or New Securities (as
the case may be), and from the exercise of the rights contained in any such
additional New Securities to the Partnership, in exchange for (x) in the case of
an issuance of REIT Shares, Partnership Common Units, or (y) in the case of an
issuance of Preferred Shares or New Securities, Partnership Equivalent Units;
provided, however, that notwithstanding the foregoing, the Special Limited
Partner may issue REIT Shares, Preferred Shares or New Securities (a) pursuant
to Section 4.4 or Section 15.1.B hereof, (b) pursuant to a dividend or
distribution (including any stock split) of REIT Shares, Preferred Shares or New
Securities to all of the holders of REIT Shares, Preferred Shares or New
Securities (as the case may be), (c) upon a conversion, redemption or exchange
of Preferred Shares, (d) upon a conversion, redemption, exchange or exercise of
New Securities, or (e) in connection with an acquisition of Partnership Units or
a property or other asset to be owned, directly or indirectly, by the Special
Limited Partner.  In the event of any issuance of additional REIT Shares,
Preferred Shares or New Securities by the Special Limited Partner, and the
contribution to the Partnership, by the Special Limited Partner, of the cash
proceeds or other consideration received from such issuance, the Partnership
shall pay the Special Limited Partner’s expenses associated with such issuance,
including any underwriting discounts or commissions.  In the event that the
Special Limited Partner issues any additional REIT Shares, Capital Shares or New
Securities and contributes the cash proceeds or other consideration received
from the issuance thereof to the Partnership, the Partnership is authorized to
issue a number of Partnership Common Units or Partnership Equivalent Units to
the Special Limited Partner equal to the number of REIT Shares, Capital Shares
or New Securities so issued (and, in the case of REIT Shares, divided by the
Adjustment Factor then in effect) in accordance with this Section 4.3.E without
any further act, approval or vote of any Partner or any other Persons.

 

Section 4.4                                    Equity Plans.

 

A.                                    Options Granted to Persons other than
Partnership Employees.  If at any time or from time to time, in connection with
any Stock Option Plan, an option to purchase REIT Shares granted to a Person
other than a Partnership Employee is duly exercised:

 

(1)                                 The Special Limited Partner, shall, as soon
as practicable after such exercise, make a Capital Contribution to the
Partnership in an amount equal to the exercise price paid to the Special Limited
Partner by such exercising party in connection with the exercise of such stock
option.

 

(2)                                 Notwithstanding the amount of the Capital
Contribution actually made pursuant to Section 4.4.A(1) hereof, the Special
Limited Partner shall be deemed to have contributed to the Partnership as a
Capital Contribution an amount equal to the Value of a REIT Share as of the date
of exercise multiplied by the number of REIT Shares then being issued in
connection with the exercise of such stock option.  In exchange for such Capital
Contribution, the Partnership shall issue a number of Partnership Common Units
to the Special Limited Partner equal to the quotient of (a) the number of REIT
Shares issued in connection with the exercise of such stock option, divided by
(b) the Adjustment Factor then in effect.

 

B.                                    Options Granted to Partnership Employees. 
If at any time or from time to time, in connection with any Stock Option Plan,
an option to purchase REIT Shares granted to a Partnership Employee is duly
exercised:

 

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(1)                                 The Special Limited Partner shall sell to
the Optionee, and the Optionee shall purchase from the Special Limited Partner,
for a cash price per share equal to the Value of a REIT Share at the time of the
exercise, the number of REIT Shares equal to (a) the exercise price payable by
the Optionee in connection with the exercise of such stock option divided by
(b) the Value of a REIT Share at the time of such exercise.

 

(2)                                 The Special Limited Partner shall sell to
the Partnership (or if the Optionee is an employee or other service provider of
a Partnership Subsidiary, the Special Limited Partner shall sell to such
Partnership Subsidiary), and the Partnership (or such Subsidiary, as applicable)
shall purchase from the Special Limited Partner, a number of REIT Shares equal
to (a) the number of REIT Shares as to which such stock option is being
exercised, less (b) the number of REIT Shares sold pursuant to Section 4.4.B(1)
hereof. The purchase price per REIT Share for such sale of REIT Shares to the
Partnership (or such Subsidiary) shall be the Value of a REIT Share as of the
date of exercise of such stock option.

 

(3)                                 The Partnership shall transfer to the
Optionee (or if the Optionee is an employee or other service provider of a
Partnership Subsidiary, the Partnership Subsidiary shall transfer to the
Optionee) at no additional cost, as additional compensation, the number of REIT
Shares described in Section 4.4.B(2) hereof.

 

(4)                                 The Special Limited Partner shall, as soon
as practicable after such exercise, make a Capital Contribution to the
Partnership of an amount equal to all proceeds received (from whatever source,
but excluding any payment in respect of payroll taxes or other withholdings) by
the Special Limited Partner in connection with the exercise of such stock
option.  The Special Limited Partner shall receive for such Capital
Contribution, Partnership Common Units in an amount equal to the number of REIT
Shares for which such option was exercised divided by the Adjustment Factor then
in effect.

 

C.                                    Restricted Stock Granted to Partnership
Employees.  If at any time or from time to time, in connection with any Equity
Plan (other than a stock option plan), any REIT Shares are issued to a
Partnership Employee (including any REIT Shares that are subject to forfeiture
in the event such Partnership Employee terminates his employment by the
Partnership or a Partnership Subsidiary) in consideration for services performed
for the Partnership or a Partnership Subsidiary:

 

(1)                                 The Special Limited Partner shall issue such
number of REIT Shares as are to be issued to the Partnership Employee in
accordance with the Equity Plan;

 

(2)                                 The following events will be deemed to have
occurred:  (a) the Special Limited Partner shall be deemed to have sold such
shares to the Partnership (or if the Partnership Employee is an employee or
other service provider of a Partnership Subsidiary, to such Partnership
Subsidiary) for a purchase price equal to the Value of such shares, (b) the
Partnership (or such Partnership Subsidiary) shall be deemed to have delivered
the shares to the Partnership Employee, (c) the Special Limited Partner shall be
deemed to have contributed the purchase price to the Partnership as a Capital
Contribution, and (d) in the case where the Partnership Employee is an employee
of a Partnership Subsidiary, the Partnership shall be deemed to have contributed
such amount to the capital of the Partnership Subsidiary; and

 

(3)                                 The Partnership shall issue to the Special
Limited Partner a number of Partnership Common Units equal to the number of
newly issued REIT Shares divided by the Adjustment Factor then in effect in
consideration for a deemed Capital Contribution in an amount equal to (x) the
number of newly issued Partnership Common Units, multiplied by (y) a fraction,
the numerator of which is the Value of a REIT Share, and the denominator of
which is the Adjustment Factor then in effect.

 

D.                                    Restricted Stock Granted to Persons other
than Partnership Employees.  If at any time or from time to time, in connection
with any Equity Plan (other than a stock option plan), any REIT shares are
issued to

 

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a Person other than a Partnership Employee in consideration for services
performed for the Special Limited Partner, the General Partner, the Partnership
or a Partnership Subsidiary:

 

(1)                                 The Special Limited Partner shall issue such
number of REIT Shares as are to be issued to such Person in accordance with the
Equity Plan; and

 

(2)                                 The Special Limited Partner shall be deemed
to have contributed the Value of such REIT Shares to the Partnership as a
Capital Contribution, and the Partnership shall issue to the Special Limited
Partner a number of newly issued Partnership Common Units equal to the number of
newly issued REIT Shares divided by the Adjustment Factor then in effect.

 

E.                                     Future Stock Incentive Plans.  Nothing in
this Agreement shall be construed or applied to preclude or restrain the General
Partner or the Special Limited Partner from adopting, modifying or terminating
stock incentive plans for the benefit of employees, directors or other business
associates of the General Partner, the Special Limited Partner, the Partnership
or any of their Affiliates.  The Partners acknowledge and agree that, in the
event that any such plan is adopted, modified or terminated by the General
Partner or the Special Limited Partner, amendments to this Section 4.4 may
become necessary or advisable and that any approval or Consent to any such
amendments requested by the General Partner or the Special Limited Partner shall
be deemed granted.

 

F.                                      Issuance of Partnership Common Units. 
The Partnership is expressly authorized to issue Partnership Common Units in the
numbers specified in this Section 4.4 without any further act, approval or vote
of any Partner or any other Persons.

 

Section 4.5                                    Dividend Reinvestment Plan, Stock
Incentive Plan or Other Plan.  Except as may otherwise be provided in this
Article 4, all amounts received by the Special Limited Partner in respect of any
dividend reinvestment plan, stock incentive or other stock or subscription plan
or agreement, either (a) shall be utilized by the Special Limited Partner to
effect open market purchases of REIT Shares, or (b) if the Special Limited
Partner elects instead to issue new REIT Shares with respect to such amounts,
shall be contributed by the Special Limited Partner to the Partnership in
exchange for additional Partnership Common Units.  Upon such contribution, the
Partnership will issue to the Special Limited Partner a number of Partnership
Common Units equal to the number of newly issued REIT Shares divided by the
Adjustment Factor then in effect.

 

Section 4.6                                    No Interest; No Return.  No
Partner shall be entitled to interest on its Capital Contribution or on such
Partner’s Capital Account.  Except as provided herein or by law, no Partner
shall have any right to demand or receive the return of its Capital Contribution
from the Partnership.

 

Section 4.7                                    Conversion or Redemption of
Preferred Shares; Redemption of REIT Shares.

 

A.                                    Conversion of Preferred Shares.  Subject
to the terms of any Partnership Unit Designation, if, at any time, any Preferred
Shares are converted into REIT Shares, in whole or in part, then an equal number
of Partnership Equivalent Units held by the Special Limited Partner that
correspond to the class or series of Preferred Shares so converted shall
automatically be converted into a number of Partnership Common Units equal to
the quotient of (i) the number of REIT Shares issued upon such conversion
divided by (ii) the Adjustment Factor then in effect.

 

B.                                    Redemption of Preferred Shares.  Subject
to the terms of any Partnership Unit Designation, if, at any time, any Preferred
Shares are redeemed, repurchased or otherwise acquired (whether by exercise of a
put or call, automatically or by means of another arrangement) by the Special
Limited Partner for cash, then, immediately prior to such redemption of
Preferred Shares, the Partnership shall redeem an equal number of Partnership
Equivalent Units held by the Special Limited Partner that correspond to the
class or series of Preferred Shares so redeemed, repurchased or acquired upon
the same terms and for the same price per Partnership Equivalent Unit, as such
Preferred Shares are redeemed, repurchased or acquired.

 

C.                                    Redemption, Repurchase or Forfeiture of
REIT Shares.  If, at any time, any REIT Shares are redeemed, repurchased or
otherwise acquired (whether by exercise of a put or call, upon forfeiture of any
award

 

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granted under any Equity Plan, automatically or by means of another arrangement)
by the Special Limited Partner, then, immediately prior to such redemption,
repurchase or acquisition of REIT Shares, the Partnership shall redeem a number
of Partnership Common Units held by the Special Limited Partner equal to the
quotient of (i) the number of REIT Shares so redeemed, repurchased or acquired,
divided by (ii) the Adjustment Factor then in effect, such redemption,
repurchase or acquisition to be upon the same terms and for the same price per
Partnership Common Unit (after giving effect to application of the Adjustment
Factor) as such REIT Shares are redeemed, repurchased or acquired.

 

Section 4.8                                    Other Contribution Provisions. 
In the event that any Partner is admitted to the Partnership and is given 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 such Partner had
contributed the cash to the capital of the Partnership.  In addition, with the
consent of the General Partner, one or more Partners (including the Special
Limited Partner) may enter into contribution agreements with the Partnership
which have the effect of providing a guarantee of certain obligations of the
Partnership.

 

Section 4.9                                    Excluded Properties.  The Special
Limited Partner shall contribute each Excluded Property (or, if applicable, the
net proceeds (after payment of all transfer taxes and other transaction costs)
received by the Special Limited Partner from the sale, transfer or other
disposition of an Excluded Property to a Person who is not a direct or indirect
wholly-owned Subsidiary of the Special Limited Partner) to the Partnership upon
the earlier of (i) such time as it is commercially practicable to contribute
such property to the Partnership without adverse tax or other economic
consequence to the Special Limited Partner and (ii) any sale, transfer or other
disposition of an Excluded Property to a Person who is not a direct or indirect
wholly-owned Subsidiary of the Special Limited Partner.  Upon any such
contribution of an Excluded Property or the proceeds therefrom, the Special
Limited Partner shall receive in exchange for such contribution, notwithstanding
the actual value of such Excluded Property or the amount of such proceeds (as
the case may be), the Specified Partnership Units applicable to such Excluded
Property.  The Partnership is expressly authorized to issue the Specified
Partnership Units in the numbers specified in this Section 4.9 without any
further act, approval or vote of any Partner or any other Persons.

 

ARTICLE 5
DISTRIBUTIONS

 

Section 5.1                                    Requirement and Characterization
of Distributions.  Subject to the terms of any Partnership Unit Designation that
provides for a class or series of Partnership Preferred Units with a preference
with respect to the payment of distributions, the General Partner may, at any
time or from time to time, cause the Partnership to distribute such amounts as
the General Partner may determine to the Holders of Partnership Common Units in
accordance with their respective Percentage Interests of Partnership Common
Units on such Partnership Record Date.  Distributions payable with respect to
any Partnership Units that were not outstanding during the entire period in
respect of which any distribution is made (other than any Partnership Units
issued to the Special Limited Partner in connection with the issuance of REIT
Shares or Capital Shares by the Special Limited Partner) may, in the discretion
of the General Partner, be prorated based on the portion of the period that such
Partnership Units were outstanding.  The General Partner shall make reasonable
efforts to cause the Partnership to distribute sufficient amounts to enable the
Special Limited Partner, for so long as the Special Limited Partner has
determined to qualify as a REIT, to pay stockholder dividends that will
(a) satisfy the REIT Requirements and (b) eliminate any U.S. federal income or
excise tax liability of the Special Limited Partner.

 

Notwithstanding the foregoing, in the event any Excluded Property (or the
proceeds therefrom) has not been contributed to the Partnership pursuant to
Section 4.9, the distributions provided for above shall be calculated, to the
extent possible, based on Adjusted Available Cash as if each Excluded Property
had been contributed to the Partnership in exchange for Partnership Common Units
pursuant to Section 4.9; provided, however, that in the event any Excluded
Property (or the proceeds therefrom) has not been contributed to the Partnership
pursuant to Section 4.9, any distributions to be made with respect to the
Special Limited Partner’s Partnership Units shall in the aggregate be reduced to
the extent of any REIT Available Cash.

 

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Section 5.2                                    Distributions in Kind.  No Holder
may demand to receive property other than cash as provided in this Agreement. 
The General Partner may cause the Partnership to make a distribution in kind of
Partnership assets to the Holders, 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 hereof.

 

Section 5.3                                    Amounts Withheld.  All amounts
withheld (or otherwise paid by the Partnership with respect to any Holder)
pursuant to the Code or any provisions of any state or local tax law and
Section 10.4 hereof with respect to any allocation, payment or distribution to
any Holder shall be treated as amounts paid or distributed to such Holder
pursuant to Section 5.1 hereof for all purposes under this Agreement (except to
the extent that, pursuant to Section 10.4, the applicable Partner has reimbursed
such amount to the Partnership other than through a reduction in any
distributions made or to be made to the Partner).

 

Section 5.4                                    Distributions upon Liquidation. 
Notwithstanding the other provisions of this Article 5, upon the occurrence of a
Liquidating Event, the assets of the Partnership shall be distributed to the
Holders in accordance with Section 13.2 hereof.

 

Section 5.5                                    Distributions to Reflect
Additional Partnership Units.  In the event that the Partnership issues
additional Partnership Units pursuant to the provisions of Article 4 hereof,
subject to the rights of any Holder of any Partnership Interest set forth in a
Partnership Unit Designation, the General Partner is hereby authorized to make
such revisions to this Article 5 and to Article 6 as it determines are necessary
or desirable to reflect the issuance of such additional Partnership Units,
including, without limitation, making preferential distributions or allocations
to certain classes of Partnership Units.

 

Section 5.6                                    Restricted Distributions. 
Notwithstanding any provision to the contrary contained in this Agreement,
neither the Partnership nor the General Partner, on behalf of the Partnership,
shall make a distribution to any Holder if such distribution would violate the
Act or other applicable law.

 

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 Partnership Year as of the end of
each such year.  Except as otherwise provided in this Article 6, and subject to
Section 11.6.C hereof, an allocation to a Holder 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.  Subject to Section 11.6.C
hereof, Net Income and Net Loss shall be allocated to each of the Holders as
follows:

 

(i)                                     Net Income will be allocated to Holders
of Partnership Preferred Units in accordance with and subject to the terms of
the Partnership Unit Designation applicable to such Partnership Preferred Units;

 

(ii)                                  remaining Net Income will be allocated to
the Holders of Partnership Common Units in accordance with their respective
Percentage Interests at the end of each Partnership Year;

 

(iii)                               subject to the terms of any Partnership Unit
Designation, Net Loss will be allocated to the Holders of Partnership Common
Units in accordance with their respective Percentage Interests at the end of
each Partnership Year; and

 

25

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(iv)                              for purposes of this Section 6.2.A, the
Percentage Interests of the Holders of Partnership Common Units shall be
calculated based on a denominator equal to the aggregate Partnership Common
Units outstanding as of the date of determination.

 

Section 6.3                                    Additional Allocation
Provisions.  Notwithstanding the foregoing provisions of this Article 6:

 

A.                                    Special Allocations Regarding Partnership
Preferred Units.  If any Partnership Preferred Units are redeemed pursuant to
Section 4.7.B hereof (treating a full liquidation of the General Partner’s
Partnership Interest or of such Special Limited Partner’s Partnership Interest
for purposes of this Section 6.3.A as including a redemption of any then
outstanding Partnership Preferred Units pursuant to Section 4.7.B hereof), for
the Partnership Year that includes such redemption (and, if necessary, for
subsequent Partnership Years) (a) gross income and gain (in such relative
proportions as the General Partner shall determine) shall be allocated to the
holder(s) of such Partnership Preferred Units to the extent that the Redemption
Amounts paid or payable with respect to the Partnership Preferred Units so
redeemed (or treated as redeemed) exceeds the aggregate Capital Account Balances
(net of liabilities assumed or taken subject to by the Partnership) per
Partnership Preferred Unit allocable to the Partnership Preferred Units so
redeemed (or treated as redeemed) and (b) deductions and losses (in such
relative proportions as the General Partner shall determine) shall be allocated
to the holder(s) of such Partnership Preferred Units to the extent that the
aggregate Capital Account Balances (net of liabilities assumed or taken subject
to by the Partnership) per Partnership Preferred Unit allocable to the
Partnership Preferred Units so redeemed (or treated as redeemed) exceeds the
Redemption Amount paid or payable with respect to the Partnership Preferred
Units so redeemed (or treated as redeemed).

 

B.                                    Regulatory Allocations.

 

(i)                                     Minimum Gain Chargeback.  Except as
otherwise provided in Regulations Section 1.704-2(f), notwithstanding the
provisions of Section 6.2 hereof, or any other provision of this Article 6, if
there is a net decrease in Partnership Minimum Gain during any Partnership Year,
each Holder shall be specially allocated items of Partnership income and gain
for such year (and, if necessary, subsequent years) in an amount equal to such
Holder’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 Holder 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.B(i) is intended to qualify as a “minimum gain
chargeback” within the meaning of Regulations Section 1.704-2(f) and shall be
interpreted consistently therewith.

 

(ii)                                  Partner Minimum Gain Chargeback.  Except
as otherwise provided in Regulations Section 1.704-2(i)(4) or in
Section 6.3.B(i) hereof, if there is a net decrease in Partner Minimum Gain
attributable to a Partner Nonrecourse Debt during any Partnership Year, each
Holder 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 Holder’s respective 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 Holder 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.B(ii) is intended to qualify as a “chargeback
of partner nonrecourse debt minimum gain” within the meaning of Regulations
Section 1.704-2(i) and shall be interpreted consistently therewith.

 

(iii)                               Nonrecourse Deductions and Partner
Nonrecourse Deductions.  Any Nonrecourse Deductions for any Partnership Year
shall be specially allocated to the Holders in accordance with their respective
Percentage Interests.  Any Partner Nonrecourse Deductions for any Partnership
Year shall be specially allocated to the Holder(s) who bears the economic risk
of

 

26

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loss with respect to the Partner Nonrecourse Debt to which such Partner
Nonrecourse Deductions are attributable, in accordance with Regulations
Section 1.704-2(i).

 

(iv)                              Qualified Income Offset.  If any Holder
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 such Holder in an amount and manner sufficient
to eliminate, to the extent required by such Regulations, the Adjusted Capital
Account Deficit of such Holder as quickly as possible, provided that an
allocation pursuant to this Section 6.3.B(iv) shall be made if and only to the
extent that such Holder 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.B(iv) were not in the Agreement.  It is intended that this
Section 6.3.B(iv) qualify and be construed as a “qualified income offset” within
the meaning of Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted
consistently therewith.

 

(v)                                 Gross Income Allocation.  In the event that
any Holder has a deficit Capital Account at the end of any Partnership Year that
is in excess of the sum of (1) the amount (if any) that such Holder is obligated
to restore to the Partnership upon complete liquidation of such Holder’s
Partnership Interest (including, the Holder’s interest in outstanding
Partnership Preferred Units and other Partnership Units) and (2) the amount that
such Holder is deemed to be obligated to restore pursuant to the penultimate
sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5), each such
Holder shall be specially allocated items of Partnership income and gain in the
amount of such excess to eliminate such deficit as quickly as possible, provided
that an allocation pursuant to this Section 6.3.B(v) shall be made if and only
to the extent that such Holder 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.B(v) and Section 6.3.B(iv) hereof were
not in the Agreement.

 

(vi)                              Limitation on Allocation of Net Loss.  To the
extent that any allocation of Net Loss would cause or increase an Adjusted
Capital Account Deficit as to any Holder, such allocation of Net Loss shall be
reallocated (x) first, among the other Holders of Partnership Common Units in
accordance with their respective Percentage Interests, and (y) thereafter, among
the Holders of other Partnership Units, as determined by the General Partner,
subject to the limitations of this Section 6.3.B(vi).

 

(vii)                           Section 754 Adjustment.  To the extent that 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 Holder of Partnership Common Units in complete liquidation of
its 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 Holders of Partnership Common
Units in accordance with their respective Percentage Interests in the event that
Regulations Section 1.704-1(b)(2)(iv)(m)(2) applies, or to the Holder(s) to whom
such distribution was made in the event that Regulations
Section 1.704-1(b)(2)(iv)(m)(4) applies.

 

(viii)                        Curative Allocations.  The allocations set forth
in Sections 6.3.B(i), (ii), (iii), (iv), (v), (vi) and (vii) hereof (the
“Regulatory Allocations”) are intended to comply with certain regulatory
requirements, including the requirements of Regulations Sections 1.704-1(b) and
1.704-2.  Notwithstanding the provisions of Section 6.1 hereof, the Regulatory
Allocations shall be taken into account in allocating other items of income,
gain, loss and deduction among the Holders of Partnership Common Units so that
to the extent possible without violating the requirements giving rise to the
Regulatory Allocations, the net amount of such allocations of other items and
the Regulatory Allocations to each Holder of a Partnership Common Unit shall be
equal

 

27

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to the net amount that would have been allocated to each such Holder if the
Regulatory Allocations had not occurred.

 

C.                                    Special Allocations Upon Liquidation. 
Notwithstanding any provision in this Article 6 to the contrary, in the event
that the Partnership disposes of all or substantially all of its assets in a
transaction that will lead to a liquidation of the Partnership pursuant to
Article 13 hereof, then any Net Income or Net Loss realized in connection with
such transaction and thereafter (and, if necessary, constituent items of income,
gain, loss and deduction) shall be specially allocated for such Partnership Year
(and to the extent permitted by Section 761(c) of the Code, for the immediately
preceding Partnership Year) among the Holders as required so as to cause
liquidating distributions pursuant to Section 13.2.A(4) hereof to be made in the
same amounts and proportions as would have resulted had such distributions
instead been made pursuant to Article 5 hereof.

 

D.                                    Allocation of Excess Nonrecourse
Liabilities.  For purposes of determining a Holder’s proportional share of the
“excess nonrecourse liabilities” of the Partnership within the meaning of
Regulations Section 1.752-3(a)(3), each Holder’s respective interest in
Partnership profits shall be equal to such Holder’s Percentage Interest with
respect to Partnership Common Units.

 

Section 6.4                                    Tax Allocations.

 

A.                                    In General.  Except as otherwise provided
in this Section 6.4, for income tax purposes under the Code and the Regulations
each Partnership item of income, gain, loss and deduction (collectively, “Tax
Items”) shall be allocated among the Holders 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 hereof.

 

B.                                    Section 704(c) Allocations.
 Notwithstanding Section 6.4.A hereof, Tax Items with respect to Property that
is contributed to the Partnership with a Gross Asset Value that varies from its
basis in the hands of the contributing Partner immediately preceding the date of
contribution shall be allocated among the Holders for income tax purposes
pursuant to Regulations promulgated under Code Section 704(c) so as to take into
account such variation.  The Partnership shall account for such variation under
any method approved under Code Section 704(c) and the applicable Regulations as
chosen by the General Partner.  In the event that the Gross Asset Value of any
partnership asset is adjusted pursuant to subsection (b) of the definition of
“Gross Asset Value” (provided in Article 1 hereof), 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 Code Section 704(c) and the applicable Regulations and
using the method 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, including any Partnership Unit Designation, all management
powers over the business and affairs of the Partnership are and shall be
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.  No General Partner may be removed by
the Partners, with or without cause, except with the consent of the General
Partner.  In addition to the powers now or hereafter granted a general partner
of a limited partnership under applicable law or that 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 and the terms of
any Partnership Unit Designation, shall have full and exclusive power and
authority, without the consent of any Limited Partner, to conduct or authorize
the conduct of the business of the Partnership, to exercise or direct the
exercise of all powers of the Partnership and the General Partner under the Act
and this Agreement and to effectuate the purposes of the Partnership, including,
without limitation, to cause the Partnership to enter into agreements or engage
in transactions with affiliates of the Partnership or the General Partner, issue
additional Partnership Interests, make distributions, sell, pledge, lease,
mortgage or otherwise dispose of all, substantially all or any portion of its
assets, form and conduct all or any portion of its business and affairs

 

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through subsidiaries or joint ventures of any form, merge with or into, convert
to another form of entity or jurisdiction of formation, incur or guarantee debt
for any purpose and obtain and maintain casualty, liability and other insurance
on the Properties and liability insurance for the Indemnitees hereunder.

 

B.                                    Except as provided in Section 7.3 hereof
and subject to the rights of any Holder of any Partnership Interest set forth in
a Partnership Unit Designation, the General Partner is authorized to execute and
deliver any affidavit, agreement, certificate, consent, instrument, notice,
power of attorney, waiver or other writing or document in the name and on behalf
of the Partnership and to otherwise exercise any power of the General Partner
under this Agreement and the Act without any further act, approval or vote of
the Partners or any other Persons and, in the absence of any specific trust
action on the part of the General Partner to the contrary, the taking of any
action or the execution of any such document or writing by an officer or trustee
of the General Partner, in the name and on behalf of the General Partner, in its
capacity as the general partner of the Partnership, shall conclusively evidence
(1) the approval thereof by the General Partner, in its capacity as the general
partner of the Partnership, (2) the General Partner’s determination that such
action, document or writing is necessary or desirable to conduct the business
and affairs of the Partnership, exercise the powers of the Partnership under the
Act and this Agreement or effectuate the purposes of the Partnership, or any
other determination by the General Partner required by this Agreement in
connection with the taking of such action or execution of such document or
writing, and (3) the authority of such trustee or officer with respect thereto.

 

C.                                    The determination as to any of the
following matters, made by or at the direction of the General Partner consistent
with the Act and this Agreement, shall be final and conclusive and shall be
binding upon the Partnership and every Limited Partner:  the amount of assets at
any time available for distribution or the redemption of Common Units or
Preferred Units; the amount and timing of any distribution; any determination to
redeem Tendered Units; the amount, purpose, time of creation, increase or
decrease, alteration or cancellation of any reserves or charges and the
propriety thereof (whether or not any obligation or liability for which such
reserves or charges shall have been created shall have been paid or discharged);
the fair value, or any sale, bid or asked price to be applied in determining the
fair value, of any asset owned or held by the Partnership; any matter relating
to the acquisition, holding and disposition of any assets by the Partnership;
the Value of any REIT share; or any other matter relating to the business and
affairs of the Partnership or required or permitted by applicable law, this
Agreement or otherwise to be determined by the General Partner.

 

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.                                     Notwithstanding any other provision of
this Agreement or 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 belief that such action or omission
is necessary or advisable in order (i) to protect the ability of the Special
Limited Partner to continue to qualify as a REIT, (ii) for the Special Limited
Partner otherwise to satisfy the REIT Requirements, (iii) for the Special
Limited Partner to avoid incurring any taxes under Code Section 857 or Code
Section 4981, or (iv) for any wholly-owned Subsidiary of the Special Limited
Partner to continue to qualify as a QRS, is expressly authorized under this
Agreement and is deemed approved by all of the Limited Partners.

 

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 Maryland
and each other state, the District of Columbia or any other jurisdiction, in
which the Partnership may elect to do business or own property.  Subject to the
terms of Section 8.5.A hereof, 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 to the extent provided by applicable
law) in the State of Maryland and any other state, or the District of Columbia
or other jurisdiction, in which the Partnership may elect to do business or own
property.

 

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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:

 

(1)                                 admitting a Person as a Partner, except as
otherwise provided in this Agreement;

 

(2)                                 performing any act that would subject a
Limited Partner to liability, except as provided herein or under the Act;

 

(3)                                 entering into any contract, mortgage, loan
or other agreement that, in the absence of a default under such document,
expressly prohibits or restricts (a) the Special Limited Partner or the
Partnership from performing its specific obligations under Section 15.1 hereof
or (b) a Limited Partner from exercising its rights under Section 15.1 hereof to
effect a Redemption, except, in either case, with the written consent of such
Limited Partner affected by the prohibition or restriction.

 

B.                                    The General Partner shall not, without the
Consent of the Partners, undertake on behalf of the Partnership, or enter into
any transaction that would have the effect of, any of the following actions:

 

(1)                                 except as provided in Section 7.3.C hereof,
amend, modify or terminate this Agreement;

 

(2)                                 except as otherwise permitted by this
Agreement, or in connection with a Termination Transaction effected in
accordance with Section 11.7, Transfer any portion of the Partnership Interest
of the General Partner or admit into the Partnership any additional or successor
General Partner;

 

(3)                                 except as otherwise permitted by this
Agreement, or in connection with a Termination Transaction effected in
accordance with Section 11.7, voluntarily withdraw as a general partner of the
Partnership;

 

(4)                                 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; or

 

(5)                                 institute any proceeding for bankruptcy on
behalf of the Partnership.

 

C.                                    Notwithstanding Section 7.3.B hereof but
subject to the rights of any Holder of any Partnership Interest set forth in a
Partnership Unit Designation and Section 7.3.D, the General Partner shall have
the power, without the Consent of the Partners or the consent or approval of any
Limited Partner, to amend this Agreement as may be required to facilitate or
implement any of the following purposes:

 

(1)                                 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;

 

(2)                                 to reflect the admission, substitution or
withdrawal of Partners, the Transfer of any Partnership Interest or the
termination of the Partnership in accordance with this Agreement, and to amend
the Register in connection with such admission, substitution, withdrawal or
Transfer;

 

(3)                                 to reflect a change that is of an
inconsequential nature or does not adversely affect the Limited Partners in any
material respect, or to cure any ambiguity, correct or

 

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supplement any provision in this Agreement not inconsistent with law or with
other provisions, 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;

 

(4)                                 to satisfy any requirements, conditions or
guidelines contained in any order, directive, opinion, ruling or regulation of a
Federal or state agency or contained in Federal or state law;

 

(5)                                 to reflect such changes as are reasonably
necessary or appropriate for the Special Limited Partner to maintain its status
as a REIT or to satisfy the REIT Requirements;

 

(6)                                 to reflect such changes as are reasonably
necessary or appropriate for the General Partner or the Partnership to comply
with, or reasonably allocate the burden of any Partnership-level assessments
under, the New Partnership Audit Procedures;

 

(7)                                 to modify either or both of the manner in
which items of Net Income or Net Loss are allocated pursuant to Article 6 or the
manner in which Capital Accounts are adjusted, computed, or maintained (but in
each case only to the extent set forth in the definition of “Capital Account” or
Section 5.5 or as contemplated by the Code or the Regulations);

 

(8)                                 to reflect the issuance of additional
Partnership Interests in accordance with Article 4;

 

(9)                                 to set forth or amend the designations,
preferences, conversion or other rights, voting powers, restrictions,
limitations as to distributions, qualifications or terms or conditions of
redemption of any additional Partnership Units issued pursuant to Article 4;

 

(10)                          if the Partnership is the Surviving Partnership in
any Termination Transaction, to modify Section 15.1 or any related definitions
to provide the holders of interests in such Surviving Partnership rights that
are consistent with Section 11.7.A(ii)(v); and

 

(11)                          to reflect any other modification to this
Agreement as is reasonably necessary for the business or operations of the
Partnership or the Special Limited Partner and which does not violate
Section 7.3.D.

 

D.                                    Notwithstanding Sections 7.3.B, 7.3.C and
Article 14 hereof, this Agreement shall not be amended, and no action may be
taken by the General Partner, without the consent of each Partner, if any,
adversely affected thereby, if such amendment or action would (i) convert a
Limited Partner into a general partner of the Partnership (except as a result of
the Limited Partner becoming the General Partner pursuant to Section 12.1 or
13.1.A of this Agreement), (ii) modify the limited liability of a Limited
Partner, (iii) adversely alter the rights of any Partner to receive the
distributions to which such Partner is entitled pursuant to Article 5 or
Section 13.2.A(4) hereof, or alter the allocations specified in Article 6 hereof
(except, in any case, as permitted pursuant to Sections 4.2, 5.5 or 7.3.C
hereof), (iv) alter or modify in a manner that adversely affects any Partner the
Redemption rights, Cash Amount or REIT Shares Amount as set forth in
Section 15.1 hereof, or amend or modify any related definitions (except for
amendments to this Agreement or other actions that provide rights consistent
with Section 11.7.A(ii)(v)), or (v) amend this Section 7.3.D; provided, however,
that the consent of any individual Partner adversely affected shall not be
required for any amendment or action described above that affects all Partners
holding the same class or series of Partnership Units on a uniform or pro rata
basis, if approved by a Majority in Interest of the Limited Partners of such
class or series.  No amendment may alter the restrictions on the General
Partner’s authority set forth elsewhere in this Section 7.3 without the consent
specified therein.  Any such amendment or action consented to by any Partner
shall be effective as to that Partner, notwithstanding the absence of such
consent by any other Partner.

 

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Section 7.4                                    Reimbursement of the General
Partner and the Special Limited Partner.

 

A.                                    The General Partner shall not be
compensated for its services as general partner of the Partnership except as
provided in this Agreement (including the provisions of Articles 5 and 6 hereof
regarding distributions, payments and allocations to which it may be entitled in
its capacity as the General Partner).

 

B.                                    Subject to Section 7.4.C and
Section 15.12, the Partnership shall be liable for, and shall reimburse the
General Partner and the Special Limited Partner, as applicable, on a monthly
basis, or such other basis as the General Partner may determine, for all sums
expended in connection with the Partnership’s business, including, without
limitation, (i) expenses relating to the ownership of interests in and
management and operation of, or for the benefit of, the Partnership,
(ii) compensation of officers and employees, including, without limitation,
payments under future compensation plans of the Special Limited Partner, the
General Partner, or the Partnership that may provide for stock units, or phantom
stock, pursuant to which employees of the Special Limited Partner, the General
Partner, or the Partnership will receive payments based upon dividends on or the
value of REIT Shares, (iii) director fees and expenses and (iv) all costs and
expenses of the Special Limited Partner being a public company, including costs
of filings with the SEC, reports and other distributions to its stockholders;
provided, however, that the amount of any reimbursement shall be reduced by any
interest earned by the General Partner or the Special Limited Partner with
respect to bank accounts or other instruments or accounts held by it on behalf
of the Partnership as permitted pursuant to Section 7.5.  Such reimbursements
shall be in addition to any reimbursement of the General Partner and the Special
Limited Partner as a result of indemnification pursuant to Section 7.7 hereof.

 

C.                                    To the extent practicable, Partnership
expenses shall be billed directly to and paid by the Partnership and, subject to
Section 15.12 hereof, reimbursements to the General Partner, the Special Limited
Partner or any of their respective Affiliates by the Partnership pursuant to
this Section 7.4 shall be treated as “guaranteed payments” within the meaning of
Code Section 707(c) (unless otherwise required by the Code and the Regulations).

 

Section 7.5                                    Outside Activities of the General
Partner and the Special Limited Partner.  Neither the General Partner nor the
Special Limited Partner shall directly or indirectly enter into or conduct any
business, other than in connection with, (a) with respect to the General Partner
and the Special Limited Partner, the ownership, acquisition and disposition of
Partnership Interests, (b) with respect to the General Partner, the management
of the business of the Partnership, (c) with respect to the Special Limited
Partner, its operation as a reporting company with a class (or classes) of
securities registered under the Exchange Act, (d) with respect to the Special
Limited Partner, its operations as a REIT, (e) with respect to the Special
Limited Partner, the offering, sale, syndication, private placement or public
offering of stock, bonds, securities or other interests, (f) financing or
refinancing of any type related to the Partnership or its assets or activities,
and (g) such activities as are incidental thereto; provided, however, that each
of the General Partner and the Special Limited Partner may from time to time
hold or acquire assets in its own name or otherwise other than through the
Partnership so long as each of the General Partner and the Special Limited
Partner takes commercially reasonable measures to insure that the economic
benefits and burdens of such Property are otherwise vested in the Partnership,
whether by electing to treat such asset as an “Excluded Property” hereunder,
through assignment, mortgage loan or otherwise or, if it is not commercially
reasonable to vest such economic interests in the Partnership, the Partners
shall negotiate in good faith to amend this Agreement, including, without
limitation, the definition of “Adjustment Factor,” to reflect such activities
and the direct ownership of assets by the General Partner or the Special Limited
Partner, as applicable.  Nothing contained herein shall be deemed to prohibit
the General Partner from executing guarantees of Partnership debt for which it
would otherwise be liable in its capacity as General Partner.  Subject to
Section 7.3.B hereof, the General Partner, the Special Limited Partner and all
“qualified REIT subsidiaries” (within the meaning of Code Section 856(i)(2)),
taken as a group, shall not own any assets or take title to assets (other than
temporarily in connection with an acquisition prior to contributing such assets
to the Partnership) other than (i) Excluded Properties, (ii) interests in
“qualified REIT subsidiaries” (within the meaning of Code Section 856(i)(2)),
(iii) Partnership Interests as the General Partner or Special Limited Partner
and (iv) such cash and cash equivalents, bank accounts or similar instruments or
accounts as such group deems reasonably necessary, taking into account
Section 7.1.D hereof and the requirements necessary for the Special Limited
Partner to qualify as a REIT and for the General Partner and the Special Limited
Partner to carry out their respective responsibilities contemplated under this
Agreement and the Charter.  The General Partner and any Affiliates of the
General Partner may acquire Partnership Interests and shall be entitled to
exercise all rights of a Limited Partner relating to such Partnership Interests.

 

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Section 7.6                                    Transactions with Affiliates.

 

A.                                    The Partnership may lend or contribute
funds or other assets to the Special Limited Partner and its Subsidiaries or
other Persons in which the Special Limited Partner has an equity investment, and
such Persons may borrow funds from the Partnership, on terms and conditions no
less favorable to the Partnership in the aggregate than would be available from
unaffiliated third parties as determined by the General Partner.  The foregoing
authority shall not create any right or benefit in favor of any Subsidiary or
any other Person.  It is expressly acknowledged and agreed by each Partner that
the Special Limited Partner may (i) borrow funds from the Partnership in order
to redeem, at any time or from time to time, any REIT Shares, Capital Shares or
New Securities previously or hereafter issued by the Special Limited Partner,
(ii) put to the Partnership, for cash, any REIT Shares, Capital Shares or New
Securities that the Special Limited Partner may desire or be required to
purchase or redeem or (iii) borrow funds from the Partnership to acquire assets
that become Excluded Properties or will be contributed to the Partnership for
Partnership Units.  If the Special Limited Partner acquires an interest in any
Person in which the Partnership does not hold an interest, in whole or in part,
with the proceeds (whether comprised of cash or other assets) of a loan from the
Partnership to the Special Limited Partner, the Partnership shall issue to such
Person an interest in the Partnership that (i) entitles the holder thereof to
receive distributions in amounts and at the same times as interest payments on
such loan (with appropriate reductions in such distributions if any portion of
the loan is repaid), (ii) entitles the holder thereof to receive, if and to the
extent that any portion of such loan is repaid, a number of Partnership Units
equal to the quotient obtained by dividing the principal amount of the loan
repaid by the Value of REIT Shares at the date of repayment (it being understood
and agreed that if the loan is repaid with funds contributed to such corporation
by the Special Limited Partner from the proceeds of a sale of REIT Shares, the
Value of REIT Shares at the date of repayment shall be deemed to be the net
price per share at which such shares were sold), and (iii) is automatically
redeemed for no consideration upon the repayment in full of such loan.

 

B.                                    Except as provided in Section 7.5 hereof
and subject to Section 3.1 hereof, the Partnership may transfer assets to joint
ventures, limited liability companies, partnerships, corporations, business
trusts or other business entities in which it is or thereby becomes a
participant upon such terms and subject to such conditions consistent with this
Agreement and applicable law.

 

C.                                    The General Partner, the Special Limited
Partner and their respective Affiliates may sell, transfer or convey any
property to the Partnership, directly or indirectly, on terms and conditions no
less favorable to the Partnership in the aggregate than would be available from
unaffiliated third parties as determined by the General Partner.

 

D.                                    The General Partner or the Special Limited
Partner, without the approval of the Partners or any of them or any other
Persons, 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, the Special Limited Partner, Subsidiaries of the
Partnership or any Affiliate of any of them in respect of services performed,
directly or indirectly, for the benefit of the General Partner, the Special
Limited Partner, the Partnership or any of the Partnership’s Subsidiaries.

 

Section 7.7                                    Indemnification.

 

A.                                    To the fullest extent permitted by
applicable law, the Partnership shall indemnify each Indemnitee from and against
any and all losses, claims, damages, liabilities, joint or several, expenses
(including, without limitation, attorney’s fees and other 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 (“Actions”) as set forth in this Agreement in which such Indemnitee
may be involved, or is threatened to be involved, as a party, witness or
otherwise; provided, however, that the Partnership shall not indemnify an
Indemnitee (i) arising from actions or omissions by the Indemnitee that are
material to the matter giving rise to the action and are established by a final
judgment of a court of competent jurisdiction to constitute fraud, intentional
harm or gross negligence on the part of the Indemnitee, (ii) arising from an
action or proceeding initiated by the Indemnitee (other than an action to
enforce such Indemnitee’s rights to indemnification or advance of expenses under
this Section 7.7 or under any other applicable law or agreement) or (iii) with
respect to any claim as to which the Indemnitee is established by a final
judgment of a court of competent jurisdiction to be liable to the Partnership,
and then only with respect to such claim.  Without limitation, the

 

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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.  It is the
intention of this Section 7.7.A that the Partnership indemnify each Indemnitee
to the fullest extent permitted by law.  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 of an Indemnitee or upon a plea
of nolo contendere or its equivalent by an Indemnitee, or an entry of an order
of probation against an Indemnitee prior to judgment, does not create a
presumption that such Indemnitee acted in a manner contrary to that specified in
this Section 7.7.A with respect to the subject matter of such proceeding.  Any
indemnification pursuant to this Section 7.7 shall be made only out of the
assets of the Partnership, and neither the General Partner nor any other Holder
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.                                    To the fullest extent permitted by law,
expenses incurred by an Indemnitee who is a party to a proceeding or otherwise
subject to or the focus of or is involved in any Action shall be paid or
reimbursed by the Partnership as incurred by the Indemnitee in advance of the
final disposition of the Action 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, provided that such
undertaking need not be secured and shall be without reference to the financial
ability for repayment.

 

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 and shall inure to the
benefit of the heirs, successors, assigns and administrators of the Indemnitee
unless otherwise provided in a written agreement with such Indemnitee or in the
writing pursuant to which such Indemnitee is indemnified.

 

D.                                    The Partnership may, but shall not be
obligated to, purchase and maintain insurance, on behalf of any of the
Indemnitees and such other Persons as the General Partner shall determine,
against any liability that may be asserted against or expenses that may be
incurred by 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.                                     Any liabilities which an Indemnitee
incurs as a result of acting on behalf of the Partnership, the General Partner
or the Special Limited Partner (whether as a fiduciary or otherwise) in
connection with the operation, administration or maintenance of an employee
benefit plan or any related trust or funding mechanism (whether such liabilities
are in the form of excise taxes assessed by the IRS, penalties assessed by the
Department of Labor, restitutions to such a plan or trust or other funding
mechanism or to a participant or beneficiary of such plan, trust or other
funding mechanism, or otherwise) shall be treated as liabilities or judgments or
fines under this Section 7.7, unless such liabilities arise as a result of such
Indemnitee’s fraud, intentional harm or gross negligence on the part of the
Indemnitee.

 

F.                                      In no event may an Indemnitee subject
any of the Holders to personal liability by reason of the indemnification
provisions set forth in this Agreement.

 

G.                                    An Indemnitee shall not be denied any
indemnification to which such Indemnitee may be entitled under this Section 7.7
solely 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

 

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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.                                        It is the intent of the parties that
any amounts paid by the Partnership to the General Partner pursuant to this
Section 7.7 shall be treated as “guaranteed payments” within the meaning of Code
Section 707(c).

 

Section 7.8                                    Liability of the General Partner
and the Special Limited Partner.

 

A.                                    To the maximum extent permitted under the
Act, the only duties that the General Partner owes to the Partnership, any
Partner or any other Person (including any creditor of any Partner or assignee
of any Partnership Interest), fiduciary or otherwise, are to perform its
contractual obligations as expressly set forth in this Agreement consistently
with the implied contractual covenant of good faith and fair dealing, and to act
with the fiduciary duties of care and loyalty which have been, in accordance
with the Act, modified as set forth in this Section 7.8.  The General Partner,
in its capacity as such, shall have no other duty, fiduciary or otherwise, to
the Partnership, any Partner or any other Person (including any creditor of any
Partner or any assignee of Partnership Interest).  The provisions of this
Agreement other than this Section 7.8 shall create contractual obligations of
the General Partner only, and no such provision shall be interpreted to expand
or modify the fiduciary duties of the General Partner under the Act.

 

B.                                    The Limited Partners agree that:  (i) the
General Partner (and the Special Limited Partner, as the trustee of the General
Partner) is acting for the benefit of the Partnership, the Limited Partners and
the Special Limited Partner’s stockholders collectively; and (ii) in the event
of a conflict between the interests of the Partnership or any Partner, on the
one hand, and the separate interests of the Special Limited Partner or its
stockholders, on the other hand, the General Partner may give priority to the
separate interests of the Special Limited Partner and its stockholders
(including, without limitation, with respect to the tax consequences to Limited
Partners, Assignees or the Special Limited Partner’s stockholders) and, in the
event of such a conflict, any action or failure to act on the part of the
General Partner (or the Special Limited Partner, in its capacity as the sole
trustee of the General Partner, or the Special Limited Partner’s directors,
officers and agents) that gives priority to the separate interests of the
Special Limited Partner or its stockholders that does not result in a violation
of the contract rights of the Limited Partners under this Agreement does not
violate the duty of loyalty or any other duty owed by the General Partner to the
Partnership and the Partners or any duty owed by the Special Limited Partner.

 

C.                                    In exercising its authority under this
Agreement, the General Partner may, but shall be under no obligation to, take
into account the tax consequences to any Partner of any action taken (or not
taken) by it.  Except as otherwise agreed by the Partnership, the General
Partner and the Partnership shall not have liability to a Limited Partner under
any circumstances as a result of any income tax liability incurred by such
Limited Partner as a result of an action (or inaction) by the General Partner or
the Partnership pursuant to the General Partner’s authority under this
Agreement.

 

D.                                    Subject to its obligations and duties as
General Partner set forth in this Agreement and applicable law, 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 employees or agents, including through the Special Limited Partner
and its employees and agents.  The General Partner shall not be responsible to
the Partnership or any Partner for any misconduct or negligence on the part of
any such employee or agent appointed by it in good faith.

 

E.                                     In performing its duties under this
Agreement and the Act, the General Partner shall be entitled to rely on the
provisions of this Agreement and on any information, opinion, report or
statement, including any financial statement or other financial data or the
records or books of account of the Partnership or any subsidiary of the
Partnership, prepared or presented by an officer, employee or agent of the
General Partner or the Special Limited Partner, or any agent of the Partnership
or any such subsidiary, or by a lawyer, certified public accountant, appraiser
or other person engaged by the Partnership as to any matter within such person’s
professional or expert

 

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competence, and any act taken or omitted to be taken in reliance upon any such
information, opinion, report or statement as to matters that the 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.  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 in good faith to be genuine
and to have been signed or presented by the proper party or parties.

 

F.                                      Notwithstanding any other provision of
this Agreement or 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 (i) to protect the ability of the
Special Limited Partner to continue to qualify as a REIT, (ii) for the Special
Limited Partner otherwise to satisfy the REIT Requirements, (iii) to avoid the
Special Limited Partner incurring any taxes under Code Section 857 or Code
Section 4981 or (iv) for any wholly-owned Subsidiary of the Special Limited
Partner to continue to qualify as a QRS, is expressly authorized under this
Agreement, is deemed approved by all of the Limited Partners and does not
violate any duty, fiduciary or otherwise, of the General Partner to the
Partnership or any other Partner.

 

G.                                    Notwithstanding anything herein to the
contrary, except for fraud, willful misconduct or gross negligence, or pursuant
to any express indemnities given to the Partnership by the General Partner
pursuant to any other written instrument, the General Partner shall not have any
personal liability whatsoever, to the Partnership or to the other Partners, for
any action or omission taken in its capacity as the General Partner or for the
debts or liabilities of the Partnership or the Partnership’s obligations
hereunder except pursuant to Section 15.1 hereof.  Without limitation of the
foregoing, and except for fraud, willful misconduct or gross negligence, or
pursuant Section 15.1 hereof or any such express indemnity, no property or
assets of the General Partner, other than its interest in the Partnership, shall
be subject to levy, execution or other enforcement procedures for the
satisfaction of any judgment (or other judicial process) in favor of any other
Partner(s) and arising out of, or in connection with, this Agreement.

 

H.                                   No trustee, officer or agent of the General
Partner (including the Special Limited Partner, in its capacity as the trustee
of the General Partner), and no director, officer or agent of the Special
Limited Partner shall have any duties directly to the Partnership or any
Partner.  No officer, trustee or agent of the General Partner, and no officer,
director, stockholder or agent of the Special Limited Partner, shall be directly
liable to the Partnership or any Partner for money damages by reason of their
service as such.

 

I.                                        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 General Partner’s, the Special
Limited Partner’s and their respective trustees’, directors’ officers’ and
agents’, liability 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                                    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 Partner, individually or collectively with other Partners or
Persons, 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, the Special Limited Partner or
one or more nominees, as the General Partner or the Special Limited Partner may
determine, including Affiliates of the General Partner or the Special Limited
Partner.  The General Partner and the Special Limited Partner hereby declare and
warrant that any Partnership assets for which legal title is held in the name of
the General Partner or the Special Limited Partner, as applicable, or any
nominee or Affiliate of the General Partner or the Special Limited Partner shall
be held by the General Partner or the Special Limited Partner, as applicable,
for the use and benefit of the Partnership in accordance with the provisions of
this Agreement.  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.

 

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Section 7.10                             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, without the consent or approval of any other Partner,
or Person, 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 take any and all actions 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 that may be available
against such Person to contest, negate or disaffirm any action of the General
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 expediency 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.  No
Limited Partner, in its capacity as such, shall have any duties or liability
under this Agreement except as expressly provided in this Agreement (including,
without limitation, Section 10.4 hereof) or under the Act.  To the maximum
extent permitted by law, no Limited Partner, including the Special Limited
Partner, in its capacity as such, shall have any personal liability whatsoever,
to the Partnership or to the other Partners, for any action or omission taken in
its capacity as a limited partner or for the debts or liabilities of the
Partnership or the Partnership’s obligations hereunder except pursuant to any
express indemnities given to the Partnership by such Limited Partner pursuant to
any other written instrument and except for liabilities of the Special Limited
Partner pursuant to Section 15.1 hereof and liabilities of the Limited Partners
pursuant to Section 10.4 hereof.  Without limitation of the foregoing, and
except pursuant to any such express indemnity (and, in the case of the Special
Limited Partner, pursuant to Section 15.1 hereof), no property or assets of a
Limited Partner, other than its interest in the Partnership, shall be subject to
levy, execution or other enforcement procedures for the satisfaction of any
judgment (or other judicial process) in favor of any other Partner(s) and
arising out of, or in connection with, this Agreement.

 

Section 8.2                                    Management of Business.  No
Limited Partner or Assignee (other than in its separate capacity as the General
Partner, any of its Affiliates or any officer, director, member, employee,
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, member, employee, partner, agent, representative, 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 Section 7.5 and any agreements entered into pursuant to
Section 7.6 hereof and any other agreements entered into by a Limited Partner or
any of its Affiliates with the General Partner, the Partnership or a Subsidiary
(including, without limitation, any employment agreement), any Limited Partner
and any Assignee, officer, director, employee, agent, trustee, Affiliate, member
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 that are in direct or
indirect competition with the Partnership or that are enhanced by the activities
of the Partnership.  Neither the Partnership nor any Partner 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

 

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ventures of any other Person (other than the General Partner or the Special
Limited Partner, to the extent expressly provided herein), and such Person shall
have no obligation pursuant to this Agreement, subject to Section 7.6 hereof and
any other agreements entered into by a Limited Partner or its Affiliates with
the General Partner, the Partnership or a Subsidiary, 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 character that, if presented to
the Partnership, any Limited Partner or such other Person, could be taken by
such Person.

 

Section 8.4                                    Return of Capital.  Except
pursuant to the rights of Redemption set forth in Section 15.1 hereof or in any
Partnership Unit Designation, no Limited Partner shall be entitled to the
withdrawal or return of its Capital Contribution, except to the extent of
distributions made pursuant to this Agreement or upon dissolution of the
Partnership as provided herein.  Except to the extent provided in Article 5 or
Article 6 hereof or otherwise expressly provided in this Agreement or in any
Partnership Unit Designation, 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 to profits, losses or distributions.

 

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, the General Partner shall deliver to each Limited
Partner a copy of any information mailed to all of the common stockholders of
the Special Limited Partner as soon as practicable after such mailing.

 

B.                                    The Partnership shall notify any Limited
Partner that is a Qualifying Party, on request, of the then current Adjustment
Factor or any change made to the Adjustment Factor.

 

C.                                    Notwithstanding any other provision of
this Section 8.5 or the Act, the General Partner may keep confidential from the
Limited Partners (or any of them), for such period of time as the General
Partner determines 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 the Special Limited Partner or (ii) the
Partnership or the General Partner is required by law or by agreement to keep
confidential.

 

Section 8.6                                    Partnership Right to Call
Partnership Interests.  Notwithstanding any other provision of this Agreement,
on and after the date on which the aggregate Percentage Interests of the Limited
Partners (other than the Special Limited Partner) are less than one percent
(1%), the Partnership shall have the right, but not the obligation, from time to
time and at any time to redeem any and all outstanding Partnership Common Units
(other than Partnership Common Units held by the General Partner or the Special
Limited Partner) by treating any Limited Partner as a Tendering Party who has
delivered a Notice of Redemption pursuant to Section 15.1 hereof for the amount
of Partnership Common Units to be specified by the General Partner by notice to
such Limited Partner that the Partnership has elected to exercise its rights
under this Section 8.6.  Such notice given by the General Partner to a Limited
Partner pursuant to this Section 8.6 shall be treated as if it were a Notice of
Redemption delivered to the General Partner by such Limited Partner.  For
purposes of this Section 8.6, (a) any Limited Partner (whether or not otherwise
a Qualifying Party) may be treated as a Qualifying Party that is a Tendering
Party and (b) the provisions of Sections 15.1.D(1), 15.1.F(1) and
15.1.F(2) hereof shall not apply, but the remainder of Section 15.1 hereof shall
apply, mutatis mutandis.

 

Section 8.7                                    No Rights as Objecting Partner. 
No Limited Partner and no Holder of a Partnership Interest shall be entitled to
exercise any of the rights of an objecting stockholder provided for under Title
3, Subtitle 2 of the Maryland General Corporation Law or any successor statute
in connection with a merger, consolidation or conversion of the Partnership.

 

Section 8.8                                    No Right to Certificate
Evidencing Units; Article 8 Securities.  Partnership Units shall not be
certificated.  No Limited Partner shall be entitled to a certificate evidencing
the Partnership Units held by such Limited Partner.  Any certificate evidencing
Partnership Units issued prior to the date hereof shall no longer evidence
Partnership Units.  The Partnership shall not elect to treat any Partnership
Unit as a “security” governed by (x) Title 8 of the Maryland Uniform Commercial
Code or (y) Article 8 of the Uniform Commercial Code of any other applicable
jurisdiction.

 

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ARTICLE 9
BOOKS, RECORDS, ACCOUNTING AND REPORTS

 

Section 9.1                                    Records and Accounting.

 

A.                                    The General Partner shall keep or cause to
be kept at the principal business office of the Partnership those records and
documents, if any, required to be maintained by the Act and other books and
records deemed by the General Partner to be appropriate 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 8.5.A, Section 9.3 or
Article 13 hereof.  Any records maintained by or on behalf of the Partnership in
the regular course of its business may be kept on any information storage
device, provided that the records so maintained are convertible into clearly
legible written form within a reasonable period of time.

 

B.                                    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, or on such other basis
as the General Partner determines to be necessary or appropriate.  To the extent
permitted by sound accounting practices and principles, the Partnership and the
General Partner may operate with integrated or consolidated accounting records,
operations and principles.

 

Section 9.2                                    Partnership Year.  The
Partnership 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 five (105) days after the close of each Partnership Year,
the General Partner shall cause to be mailed to each Limited Partner of record
as of the close of the Partnership Year, financial statements of the
Partnership, or of the Special Limited Partner if such statements are prepared
solely on a consolidated basis with the Special Limited Partner, for such
Partnership Year, presented in accordance 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 sixty (60) days after the close of each calendar quarter (except the
last calendar quarter of each year), the General Partner shall cause to be
mailed to each Limited Partner of record as of the last day of the calendar
quarter, a report containing unaudited financial statements of the Partnership,
or of the Special Limited Partner if such statements are prepared solely on a
consolidated basis with the Special Limited Partner, for such calendar quarter,
and such other information as may be required by applicable law or regulation or
as the General Partner determines to be appropriate.

 

C.                                    The General Partner may satisfy its
obligations under Section 9.3.A and Section 9.3.B by posting or making available
the reports specified in such sections on a website maintained by the General
Partner or the Special Limited Partner or the SEC.

 

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 with respect to Partnership income, gains, deductions, losses and other
items required of the Partnership for Federal and state income tax purposes and
shall use all reasonable effort to furnish, within ninety (90) days of the close
of each taxable year, the tax information reasonably required by Limited
Partners and for Federal and state income tax and any other tax reporting
purposes.  The Limited Partners shall promptly provide the General Partner with
such information relating to the Contributed Properties, including tax basis and
other relevant information, as may be reasonably requested by the General
Partner from time to time.

 

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Section 10.2                             Tax Elections.   Except as otherwise
provided herein, the General Partner shall determine whether to make any
available election pursuant to the Code, including, but not limited to, any
election under the New Partnership Audit Procedures, the election under Code
Section 754 and the election to use the “recurring item” method of accounting
provided under Code Section 461(h) with respect to property taxes imposed on the
Partnership’s Properties; provided, however, that, if the “recurring item”
method of accounting is elected with respect to such property taxes, the
Partnership shall pay the applicable property taxes prior to the date provided
in Code Section 461(h) for purposes of determining economic performance.  The
General Partner shall have the right to seek to revoke any such election
(including, without limitation, any election under the New Partnership Audit
Procedures, Code Sections 461(h) and 754).

 

Section 10.3                             Tax Matters Partner.

 

A.                                    The General Partner shall be the “tax
matters partner” of the Partnership for Federal income tax purposes and its
“partnership representative” within the meaning of Section 6223 of the New
Partnership Audit Procedures (as applicable, the “Tax Matters Partner”).  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 and expenses) shall be
borne by the Partnership in addition to any reimbursement pursuant to
Section 7.4 hereof.  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.  At the request of any Limited Partner, the
General Partner agrees to inform such Limited Partner regarding the preparation
and filing of any returns and with respect to any subsequent audit or litigation
relating to such returns; provided, however, that the General Partner shall have
the exclusive power to determine whether to file, and the content of, such
returns.

 

B.                                    The Tax Matters Partner is authorized, but
not required:

 

(1)                                 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, to the extent permitted by law,
such settlement agreement shall not bind any Partner (i) 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 (as the case may be) or
(ii) who is a “notice partner” (as defined in Code Section 6231) or a member of
a “notice group” (as defined in Code Section 6223(b)(2));

 

(2)                                 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 United
States 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;

 

(3)                                 to intervene in any action brought by any
other Partner for judicial review of a final adjustment;

 

(4)                                 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;

 

(5)                                 to enter into an agreement with the IRS to
extend the period for assessing any tax that 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

 

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(6)                                 to take any other action on behalf of the
Partners or any of them 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 hereof shall be fully applicable to the Tax Matters Partner in
its capacity as such.

 

Section 10.4                             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 Code
Section 1441, Code Section 1442, Code Section 1445 or Code Section 1446.  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 that would otherwise be made to the Limited Partner
or (ii) the General Partner determines that such payment may be satisfied out of
the Available Cash of the Partnership that would, but for such payment, be
distributed to the Limited Partner. For purposes of this Section 10.4, any tax
(including interest and penalties) assessed against or otherwise required to be
paid by the Partnership on behalf of or with respect to any Partner or otherwise
as a result of a Partner’s interest in the Partnership (including any assessment
under the New Partnership Audit Procedures) shall be treated as a withholding
tax subject to the provisions of this Section 10.4, which tax shall be allocated
among the Partners (including, in the case of assessments under the New
Partnership Audit Procedures or otherwise, any Person that was a Partner during
the taxable year or other period to which such assessment relates, even if such
Person is not a Partner at the time the assessment is made or actually paid by
the Partnership) as determined in good faith by the General 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 10.4.  In the event that a Limited Partner
fails to pay any amounts owed to the Partnership pursuant to this Section 10.4
when due, the General Partner may 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). 
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 four
(4) percentage points (but not higher than the maximum lawful rate) from the
date such amount is due (i.e., fifteen (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. If any tax or assessment is allocated
to a Partner under this Section 10.4, such Partner’s obligations to the
Partnership with respect to such tax, and the Partnership’s rights against such
Partner, shall apply jointly and severally to such Partner and any direct or
indirect transferee of or successor to such Partner’s interest.

 

Section 10.5                             Organizational Expenses.  The General
Partner may cause the Partnership to elect to deduct expenses, if any, incurred
by it in organizing the Partnership ratably over a 180-month period as provided
in Section 709 of the Code.

 

Section 10.6                             Partnership Provisions. The Partners
acknowledge that, as of the date of this Agreement, the Partnership is a
disregarded entity of the Special Limited Partner for U.S. federal income tax
purposes and will remain disregarded until such time as a Person other than the
Special Limited Partner or a disregarded entity (including a QRS) thereof
acquires an equity interest in the Partnership, at which point the Partnership
would become a partnership for U.S. federal income tax purposes.  Accordingly,
notwithstanding anything to the contrary in this Agreement, the provisions of
this Agreement that (i) relate to the maintenance of Capital Accounts,
(ii) reference or apply the provisions of Subchapter K of the Code, or
(iii) otherwise are, in the General Partner’s determination, not relevant to the
Partnership for so long as it is a disregarded entity shall, in each case, apply
only if and to the extent the Partnership becomes a partnership for U.S. federal
income tax purposes.

 

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ARTICLE 11
PARTNER TRANSFERS AND WITHDRAWALS

 

Section 11.1                             Transfer.

 

A.                                    No part of the interest of a Partner shall
be subject to the claims of any creditor, to 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.

 

C.                                    No Transfer of any Partnership Interest
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; 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 any Partnership
Units in which a security interest is held by such lender 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.

 

Section 11.2                             Transfer of General Partner’s
Partnership Interest.

 

A.                                    Except as provided in Section 11.2.B, and
subject to the rights of any Holder of any Partnership Interest set forth in a
Partnership Unit Designation, the General Partner may not Transfer all or any
portion of its Partnership Interest without the Consent of the Partners.

 

B.                                    Subject to compliance with the other
provisions of this Article 11, the General Partner may Transfer all of its
Partnership Interest at any time to the Special Limited Partner or any Person
that is, at the time of such Transfer, a direct or indirect wholly-owned
Subsidiary of the Special Limited Partner, including any “qualified REIT
subsidiary” (within the meaning of Code Section 856(i)(2)), without the Consent
of any Partner, and may designate the transferee to become the new General
Partner under Section 12.1.

 

C.                                    The General Partner may not voluntarily
withdraw as a general partner of the Partnership without the Consent of the
Limited Partners, except in connection with a Transfer of the General Partner’s
entire Partnership Interest permitted in this Article 11 and the admission of
the Transferee as a successor General Partner of the Partnership pursuant to the
Act and this Agreement.

 

D.                                    It is a condition to any Transfer of the
entire Partnership Interest of a sole General Partner otherwise permitted
hereunder that (i) coincident or prior to such Transfer, the transferee is
admitted as a General Partner pursuant to the Act and this Agreement; (ii) 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 (iii) the transferee has executed
such instruments are 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 applicable to the General Partner and the admission
of such transferee as a General Partner.

 

Section 11.3                             Limited Partners’ Rights to Transfer.

 

A.                                    General.  Prior to the end of the
Twelve-Month Period applicable to any Partnership Interest and except as
provided below and in Section 11.1.C hereof, no Limited Partner shall Transfer
all or any portion of such Partnership Interest to any transferee without the
consent of the General Partner.  After the expiration of the Twelve-Month Period
applicable to any Partnership Interest, each Limited Partner, and each
transferee of such Partnership Interest or Assignee pursuant to a Permitted
Transfer, shall have the right to Transfer all or any portion of such
Partnership Interest to any Person.  Notwithstanding the foregoing, any Limited
Partner may, at any time, without the consent of the General Partner, Transfer
all or any portion of its Partnership Interest

 

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pursuant to a Permitted Transfer.  Any Transfer of a Partnership Interest by a
Limited Partner or an Assignee is subject to Section 11.4 and, unless waived by
the General Partner, to satisfaction of the following conditions:

 

(1)                                 Special Limited Partner Right of First
Refusal.  The transferring Partner (or the Partner’s estate in the event of the
Partner’s death) shall give written notice of the proposed Transfer to the
General Partner and the Special Limited Partner, which notice shall state
(i) the identity and address of the proposed transferee and (ii) the amount and
type of consideration proposed to be received for the Transferred Partnership
Units.  The Special Limited Partner shall have ten (10) Business Days upon which
to give the Transferring Partner notice of its election to acquire the
Partnership Units on the terms set forth in such notice.  If it so elects, it
shall purchase the Partnership Units on such terms within ten (10) Business Days
after giving notice of such election; provided, however, that in the event that
the proposed terms involve a purchase for cash, the Special Limited Partner may
at its election deliver in lieu of all or any portion of such cash a note from
the Special Limited Partner payable to the Transferring Partner at a date as
soon as reasonably practicable, but in no event later than one hundred eighty
(180) days after such purchase, and bearing interest at an annual rate equal to
the total dividends declared with respect to one (1) REIT Share for the four
(4) preceding fiscal quarters of the Special Limited Partner, divided by the
Value as of the closing of such purchase; provided, further, that such closing
may be deferred to the extent necessary to effect compliance with the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, if applicable, and any
other applicable requirements of law.  If it does not so elect, the Transferring
Partner may Transfer such Partnership Units to a third party, on terms no more
favorable to the transferee than the proposed terms, subject to the other
conditions of this Section 11.3.

 

(2)                                 Qualified Transferee.  Any Transfer of a
Partnership Interest shall be made only to a single Qualified Transferee;
provided, however, that, for such purposes, all Qualified Transferees that are
Affiliates, or that comprise investment accounts or funds managed by a single
Qualified Transferee and its Affiliates, shall be considered together to be a
single Qualified Transferee; provided, further, that each Transfer meeting the
minimum Transfer restriction of Section 11.3A(4) hereof may be to a separate
Qualified Transferee.

 

(3)                                 Opinion of Counsel.  The Transferor shall
deliver or cause to be delivered to the General Partner an opinion of counsel
reasonably satisfactory to it to the effect that the proposed Transfer may be
effected without registration under the Securities Act and will not otherwise
violate the registration provisions of the Securities Act and the regulations
promulgated thereunder or violate any state securities laws or regulations
applicable to the Partnership or the Partnership Interests Transferred.  If, in
the opinion of such counsel, such Transfer would require the filing of a
registration statement under the Securities Act or would otherwise violate any
Federal or state securities laws or regulations applicable to the Partnership or
the Partnership Units, the General Partner may prohibit any Transfer otherwise
permitted under this Section 11.3 by a Limited Partner of Partnership Interests.

 

(4)                                 Minimum Transfer Restriction.  Any
Transferring Partner must Transfer not less than the lesser of (i) five hundred
(500) Partnership Units or (ii) all of the remaining Partnership Units owned by
such Transferring Partner; provided, however, that, for purposes of determining
compliance with the foregoing restriction, all Partnership Units owned by
Affiliates of a Limited Partner shall be considered to be owned by such Limited
Partner.

 

(5)                                 No Further Transfers.  The transferee shall
not be permitted to effect any further Transfer of the Partnership Units, other
than to the Special Limited Partner.

 

(6)                                 Exception for Permitted Transfers.  The
conditions of Section 11.3A(1) and Section 11.3A(3) through
Section 11.3A(5) hereof shall not apply in the case of a Permitted Transfer.

 

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It is a condition to any Transfer otherwise permitted hereunder (whether or not
such Transfer is effected during or after the applicable Twelve-Month Period)
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
liabilities of the transferor Partner are assumed by a successor by operation of
law) shall relieve the transferor Partner of its obligations under this
Agreement without the approval of the General Partner.  Notwithstanding the
foregoing, any transferee of any Transferred Partnership Interest shall be
subject to any and all ownership limitations (including, without limitation, the
Ownership Limit) contained in the Charter that may limit or restrict such
transferee’s ability to exercise its Redemption rights.  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 hereof.

 

B.                                    Incapacity.  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 its interest in the Partnership.  The Incapacity of a Limited Partner,
in and of itself, shall not dissolve or terminate the Partnership.

 

C.                                    Adverse Tax Consequences.  Notwithstanding
anything to the contrary in this Agreement, without the prior written consent of
the General Partner (which consent may be withheld in its discretion), no
Transfer by a Limited Partner of its Partnership Interests (including any
Redemption, any other acquisition of Partnership Units by the General Partner or
any acquisition of Partnership Units by the Partnership and including any
Permitted Transfer) may be made to or by any Person if either (A) the Transfer
would result in the Partnership having more than 100 partners (within the
meaning of Treasury Regulation Section 1.7704-1(h), taking into account Treasury
Regulation Section 1.7704-1(h)(3)), or (B) in the judgment of the General
Partner, (i) such Transfer would create a material risk of the Partnership being
treated as an association taxable as a corporation or would result in a
termination of the Partnership under Code Section 708, or (ii) there would be a
material risk that such Transfer would be treated as effectuated through an
“established securities market” or a “secondary market (or the substantial
equivalent thereof)” within the meaning of Code Section 7704.

 

Section 11.4                             Substituted Limited Partners.

 

A.                                    No Limited Partner shall have the right to
substitute a transferee other than a Permitted Transferee as a Limited Partner
in its place.  A transferee of the interest of a Limited Partner may be admitted
as a Substituted Limited Partner only with the consent of the General Partner;
provided, however, that a Permitted Transferee may be admitted as a Substituted
Limited Partner pursuant to a Permitted Transfer without the consent of the
General Partner.  The failure or refusal by the General Partner 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 the General
Partner.  Subject to the foregoing, an Assignee shall not be admitted as a
Substituted Limited Partner until and unless it furnishes to the General Partner
(i) evidence of acceptance, in form and substance satisfactory to the General
Partner, of all the terms, conditions and applicable obligations of this
Agreement, (ii) a counterpart signature page to this Agreement executed by such
Assignee and (iii) such other documents and instruments as the General Partner
may require to effect such Assignee’s admission as a Substituted Limited
Partner.

 

B.                                    Concurrently with, and as evidence of, the
admission of a Substituted Limited Partner, the General Partner shall amend the
Register and the books and records of the Partnership to reflect the name,
address and number of Partnership Units of such Substituted Limited Partner and
to eliminate or adjust, if necessary, the name, address and number of
Partnership Units of the predecessor of such Substituted Limited Partner.

 

C.                                    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.

 

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Section 11.5                             Assignees.  If the General Partner’s
consent is required for the admission of any transferee under Section 11.3
hereof as a Substituted Limited Partner, as described in Section 11.4 hereof,
and the General Partner withholds such consent, 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 and other items of income, gain, loss,
deduction and credit of the Partnership attributable to the Partnership Units
assigned to such transferee and the rights to Transfer the Partnership Units
provided in this Article 11, but shall not be deemed to be a holder of
Partnership Units for any other purpose under this Agreement (other than as
expressly provided in Section 15.1 hereof with respect to a Qualifying Party
that becomes a Tendering Party), and shall not be entitled to effect a Consent
or vote with respect to such Partnership Units on any matter presented to the
Limited Partners for approval (such right to Consent or vote, to the extent
provided in this Agreement or under the Act, fully remaining with the transferor
Limited Partner).  In the event that 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.

 

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 Interest in accordance with this Article 11 with
respect to which the transferee becomes a Substituted Limited Partner;
(ii) pursuant to a redemption (or acquisition by the General Partner or the
Special Limited Partner) of all of its Partnership Interest pursuant to a
Redemption under Section 15.1 hereof and/or pursuant to any Partnership Unit
Designation; or (iii) as a result of the acquisition by the General Partner or
the Special Limited Partner of all of such Limited Partner’s Partnership
Interest, whether or not pursuant to Section 15.1.B hereof.

 

B.                                    Any Limited Partner who shall Transfer all
of its Partnership Units in a Transfer (i) permitted pursuant to this Article 11
where such transferee was admitted as a Substituted Limited Partner,
(ii) pursuant to the exercise of its rights to effect a redemption of all of its
Partnership Units pursuant to a Redemption under Section 15.1 hereof and/or
pursuant to any Partnership Unit Designation or (iii) to the Special Limited
Partner, whether or not pursuant to Section 15.1.B hereof, shall cease to be a
Limited Partner.

 

C.                                    If any Partnership Unit is Transferred in
compliance with the provisions of this Article 11, or is redeemed by the
Partnership, or acquired by the Special Limited Partner pursuant to Section 15.1
hereof, on any day other than the first day of a Partnership Year, then Net
Income, Net Losses, each item thereof and all other items of income, gain, loss,
deduction and credit attributable to such Partnership Unit for such Partnership
Year shall be allocated to the transferor Partner or the Tendering Party (as the
case may be) and, in the case of a Transfer or assignment other than a
Redemption, to the transferee Partner, by taking into account their varying
interests during the Partnership Year in accordance with Code Section 706(d),
using the “interim closing of the books” method or another permissible method
selected by the General Partner.  Solely for purposes of making such
allocations, each of such items for the calendar month in which a Transfer
occurs shall be allocated to the transferee Partner and none of such items for
the calendar month in which a Transfer or a Redemption occurs shall be allocated
to the transferor Partner, or the Tendering Party (as the case may be) if such
Transfer occurs on or before the fifteenth (15th) day of the month, otherwise
such items shall be allocated to the transferor.  All distributions of Available
Cash attributable to such Partnership Unit with respect to which the Partnership
Record Date is before the date of such Transfer, assignment or Redemption shall
be made to the transferor Partner or the Tendering Party (as the case may be)
and, in the case of a Transfer other than a Redemption, all distributions of
Available Cash thereafter attributable to such Partnership Unit shall be made to
the transferee Partner.

 

D.                                    In addition to any other restrictions on
Transfer herein contained, in no event may any Transfer or assignment of a
Partnership Interest by any Partner (including any Redemption, any acquisition
of Partnership Units by the Special Limited Partner or any other acquisition of
Partnership Units by the Partnership) 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) 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) in the event
that such Transfer would cause either the Special Limited Partner to cease to
comply with the REIT Requirements or any wholly-owned Subsidiary of the Special
Limited Partner to cease to qualify as a “qualified REIT subsidiary” (within

 

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the meaning of Code Section 856(i)(2)); (v) if such Transfer would, in the
opinion of counsel to the Partnership or the General Partner, cause a
termination of the Partnership for Federal or state income tax purposes (except
as a result of the Redemption (or acquisition by the Special Limited Partner) of
all Partnership Units held by all Limited Partners); (vi) if such Transfer
would, in the opinion of legal counsel to the Partnership, cause the Partnership
to cease to be classified as a partnership for Federal income tax purposes
(except as a result of the Redemption (or acquisition by the Special Limited
Partner) of all Partnership Units held by all Limited Partners (other than the
Special Limited Partner)); (vii) 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 ERISA Section 3(14)) or a “disqualified
person” (as defined in Code Section 4975(c)); (viii) if such Transfer would, in
the opinion of legal 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; (ix) if such Transfer
requires the registration of such Partnership Interest pursuant to any
applicable Federal or state securities laws; (x) if such Transfer would create a
material risk that the Partnership would become a “publicly traded partnership,”
as such term is defined in Code Section 469(k)(2) or Code 7704(b); (xi) if such
Transfer would cause the Partnership to have more than one hundred (100)
partners for tax purposes (including as partners those persons indirectly owning
an interest in the Partnership through a partnership, limited liability company,
subchapter S corporation or grantor trust); (xii) if such Transfer causes the
Partnership to become a reporting company under the Exchange Act; or (xiii) if
such Transfer subjects the Partnership to regulation under the Investment
Company Act of 1940, the Investment Advisors Act of 1940 or ERISA, each as
amended.

 

E.                                     Transfers pursuant to this Article 11 may
only be made on the first day of a fiscal quarter of the Partnership, unless the
General Partner otherwise agrees.

 

Section 11.7                             Restrictions on Termination
Transactions.  Neither the Special Limited Partner nor the General Partner shall
engage in, or cause or permit, a Termination Transaction, other than (i) with
the Consent of the Limited Partners, or (ii) if either:

 

(i)                                     in connection with any such Termination
Transaction, each holder of Partnership Common Units (other than the Special
Limited Partner and its wholly owned Subsidiaries) will receive, or will have
the right to elect to receive, for each Partnership Common Unit an amount of
cash, securities or other property equal to the product of the Adjustment Factor
and the greatest amount of cash, securities or other property paid to a holder
of one REIT Share in consideration of one REIT Share pursuant to the terms of
such Termination Transaction; provided, that if, in connection with such
Termination Transaction, a purchase, tender or exchange offer shall have been
made to and accepted by the holders of a majority of the outstanding REIT
Shares, each holder of Partnership Common Units (other than the Special Limited
Partner and its wholly owned subsidiaries) will receive, or will have the right
to elect to receive, the greatest amount of cash, securities or other property
which such holder of Partnership Common Units would have received had it
exercised its right to Redemption pursuant to Article 15 hereof and received
REIT Shares in exchange for its Partnership Common Units immediately prior to
the expiration of such purchase, tender or exchange offer and had thereupon
accepted such purchase, tender or exchange offer and then such Termination
Transaction shall have been consummated (the fair market value, at the time of
the Termination Transaction, of the amount specified herein with respect to each
Partnership Common Unit is referred to as the “Transaction Consideration”); or

 

(ii)                                  all of the following conditions are met: 
(i) substantially all of the assets directly or indirectly owned by the
Partnership prior to the announcement of the Termination Transaction are,
immediately after the Termination Transaction, owned 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 Surviving
Partnership is classified as a partnership for U.S. Federal income tax purposes;
(iii) the Limited Partners (other than the Special Limited Partner) that held
Partnership Common Units immediately prior to the consummation of such
Termination Transaction 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; (iv) the rights of such

 

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Limited Partners with respect to the Surviving Partnership are at least as
favorable as those of Limited Partners holding Partnership Common Units
immediately prior to the consummation of such transaction (except to the extent
that any such rights are consistent with clause (v) below) and as those
applicable to any other limited partners or non-managing members of the
Surviving Partnership; and (v) such rights include:  (a) if the Special Limited
Partner, General Partner or either of its successors is a REIT with a single
class of Publicly Traded common equity securities, the right to redeem their
interests in the Surviving Partnership at any time for one of the following: 
(1) a number of such REIT’s Publicly Traded common equity securities with a fair
market value, as of the date of consummation of such Termination Transaction,
equal to the Transaction Consideration, subject to antidilution adjustments
comparable to those set forth in the definition of “Adjustment Factor” herein
(the “Successor Shares Amount”); or (2) cash in an amount equal to the fair
market value of the Successor Shares Amount at the time of such redemption,
determined in a manner consistent with the definition of “Value” herein; or
(b) if the Special Limited Partner, the General Partner or either of its
successors is not a REIT with a single class of Publicly Traded common equity
securities, the right to redeem their interests in the Surviving Partnership at
any time for cash in an amount equal to the fair market value of such interest
at the time of redemption, as determined at least once every calendar quarter by
an independent appraisal firm of recognized national standing retained by the
Surviving Partnership.

 

ARTICLE 12
ADMISSION OF PARTNERS

 

Section 12.1                             Admission of Successor General
Partner.  A successor to all or a portion of the General Partner’s Partnership
Interest pursuant to Section 11.2.B hereof who the General Partner has
designated to become a successor General Partner shall be admitted to the
Partnership as the General Partner, effective immediately upon the Transfer of
such Partnership Interest to it.  Upon any such Transfer and the admission of
any such transferee as a successor General Partner in accordance with this
Section 12.1, the transferor General Partner shall be relieved of its
obligations under this Agreement and shall cease to be a general partner of the
Partnership without any separate Consent of the Partners or the consent or
approval of any Partner.  Any such successor 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
event that the General Partner withdraws from the Partnership, or transfers its
entire Partnership Interest, in violation of this Agreement, or otherwise
dissolves or terminates or ceases to be the general partner of the Partnership,
a Majority in Interest of the Partners may elect to continue the Partnership by
selecting a successor General Partner in accordance with Section 13.1.A hereof.

 

Section 12.2                             Admission of Additional Limited
Partners.

 

A.                                    A Person (other than an existing Partner)
who makes a Capital Contribution to the Partnership in exchange for Partnership
Units and 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 and substance 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 hereof, (ii) a
counterpart signature page to this Agreement executed by such Person and
(iii) such other documents or instruments as may be required by the General
Partner in order to effect such Person’s admission as an Additional Limited
Partner.  Concurrently with, and as evidence of, the admission of an Additional
Limited Partner, the General Partner shall amend the Register and the books and
records of the Partnership to reflect the name, address, number and type of
Partnership Units of such 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.  The admission of any Person
as an Additional Limited Partner shall become effective on the date upon which
the name of such Person is recorded on the books and records of the Partnership,
following the consent of the General Partner to such admission and the
satisfaction of all the conditions set forth in Section 12.2.A.

 

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C.                                    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 of
income, gain, loss, deduction and credit allocable among Holders for such
Partnership Year shall be allocated among such Additional Limited Partner and
all other Holders by taking into account their varying interests during the
Partnership Year in accordance with Code Section 706(d), using the “interim
closing of the books” method or another permissible method selected by the
General Partner.  Solely for purposes of making such allocations, each of such
items for the calendar month in which an admission of any Additional Limited
Partner occurs shall be allocated among all the Holders including such
Additional Limited Partner, in accordance with the principles described in
Section 11.6.C hereof.  All distributions of Available Cash with respect to
which the Partnership Record Date is before the date of such admission shall be
made solely to Partners and Assignees other than the Additional Limited Partner,
and all distributions of Available Cash thereafter shall be made to all the
Partners and Assignees including such Additional Limited Partner.

 

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 Register and the books and records of the Partnership and, if
necessary, to prepare as soon as practical an amendment of this Agreement 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 hereof.

 

Section 12.4                             Limit on Number of Partners.  Unless
otherwise permitted by the General Partner, no Person shall be admitted to the
Partnership as an Additional Limited Partner if the effect of such admission
would be to cause the Partnership to have a number of Partners (including as
Partners for this purpose those Persons indirectly owning an interest in the
Partnership through another partnership, a limited liability company, a
subchapter S corporation or a grantor trust) that would cause the Partnership to
become a reporting company under the Exchange Act.

 

Section 12.5                             Admission.  A Person shall be admitted
to the Partnership as a limited partner of the Partnership or a general partner
of the Partnership only upon strict compliance, and not upon substantial
compliance, with the requirements set forth in this Agreement for admission to
the Partnership as a Limited Partner or a General Partner.

 

ARTICLE 13
DISSOLUTION, LIQUIDATION AND TERMINATION

 

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 shall continue the business of the
Partnership without dissolution.  However, the Partnership shall dissolve, and
its affairs shall be wound up, upon the first to occur of any of the following
(each a “Liquidating Event”):

 

A.                                    an event of withdrawal, as defined in
Section 10-402(2) – (9) of the Act (including, without limitation, bankruptcy),
or the withdrawal in violation of this Agreement of the last remaining General
Partner unless, within ninety (90) days after the withdrawal, a Majority in
Interest of the Partners agree in writing to continue the Partnership and to the
appointment, effective as of the date of withdrawal, of a successor General
Partner;

 

B.                                    an election to dissolve the Partnership
made by the General Partner, with or without the Consent of the Partners; or

 

C.                                    entry of a decree of judicial dissolution
of the Partnership pursuant to the provisions of the Act.

 

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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 the Holders.  After the occurrence of a Liquidating Event,
no Holder 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 that there is no remaining General Partner
or the General Partner has dissolved, become bankrupt within the meaning of the
Act or ceased to operate, any Person elected by a Majority in Interest of the
Partners (the General Partner or such other Person being referred to herein as
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 property, 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 in the Special Limited Partner) shall be applied and
distributed in the following order:

 

(1)                                 First, to the satisfaction of all of the
Partnership’s debts and liabilities to creditors other than the Holders (whether
by payment or the making of reasonable provision for payment thereof);

 

(2)                                 Second, to the satisfaction of all of the
Partnership’s debts and liabilities to the General Partner and the Special
Limited Partner (whether by payment or the making of reasonable provision for
payment thereof), including, but not limited to, amounts due as reimbursements
under Section 7.4 hereof;

 

(3)                                 Third, to the satisfaction of all of the
Partnership’s debts and liabilities to the other Holders (whether by payment or
the making of reasonable provision for payment thereof); and

 

(4)                                 Subject to the terms of any Partnership Unit
Designation, the balance, if any, to the Holders in accordance with and in
proportion to their positive Capital Account balances, after giving effect to
all contributions, distributions and allocations for all periods.

 

The General Partner shall not receive any additional compensation for any
services performed pursuant to this Article 13.

 

B.                                    Notwithstanding the provisions of
Section 13.2.A hereof that 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 Holders, 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
Holders as creditors) and/or distribute to the Holders, in lieu of cash, as
tenants in common and in accordance with the provisions of Section 13.2.A
hereof, 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 Holders, 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.                                    In the event that 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 Holders that have
positive Capital Accounts in compliance with Regulations
Section 1.704-1(b)(2)(ii)(b)(2) to the extent of, and in proportion to, positive
Capital Account balances.  If any Holder has a deficit balance in its Capital
Account (after giving effect to all contributions, distributions and allocations
for all taxable years, including the year during which such liquidation occurs),
such Holder 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

 

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Person for any purpose whatsoever.  In the sole and absolute discretion of the
General Partner or the Liquidator, a pro rata portion of the distributions that
would otherwise be made to the Holders pursuant to this Article 13 may be:

 

(1)                                 distributed to a trust established for the
benefit of the General Partner and the Holders for the purpose 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 and/or
Partnership activities.  The assets of any such trust shall be distributed to
the Holders, from time to time, in the reasonable discretion of the General
Partner, in the same proportions and amounts as would otherwise have been
distributed to the Holders pursuant to this Agreement; or

 

(2)                                 withheld or escrowed to provide a reasonable
reserve for Partnership liabilities (contingent or otherwise) and to reflect the
unrealized portion of any installment obligations owed to the Partnership,
provided that such withheld or escrowed amounts shall be distributed to the
Holders in the manner and order of priority set forth in Section 13.2.A hereof
as soon as practicable.

 

Section 13.3                             Deemed Contribution and Distribution. 
Notwithstanding any other provision of this Article 13, in the event that 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, for Federal income tax purposes the Partnership shall be deemed to
have contributed all of its assets and liabilities to a new partnership in
exchange for an interest in the new partnership; and immediately thereafter,
distributed Partnership Units to the Partners in the new partnership in
accordance with their respective Capital Accounts in liquidation of the
Partnership, and the new partnership is deemed to continue the business of the
Partnership.  Nothing in this Section 13.3 shall be deemed to have constituted
any Assignee as a Substituted Limited Partner without compliance with the
provisions of Section 11.4 hereof.

 

Section 13.4                             Rights of Holders.  Except as otherwise
provided in this Agreement and subject to the rights of any Holder of any
Partnership Interest set forth in a Partnership Unit Designation, (a) each
Holder shall look solely to the assets of the Partnership for the return of its
Capital Contribution, (b) no Holder shall have the right or power to demand or
receive property other than cash from the Partnership and (c) no Holder shall
have priority over any other Holder as to the return of its Capital
Contributions, distributions or allocations.

 

Section 13.5                             Notice of Dissolution.  In the event
that a Liquidating Event occurs or an event occurs that would, but for an
election or objection by one or more Partners pursuant to Section 13.1 hereof,
result in a dissolution of the Partnership, the General Partner or Liquidator
shall, within thirty (30) days thereafter, provide written notice thereof to
each of the Holders and, in the sole and absolute discretion of the General
Partner or the Liquidator, or as required by the Act, to all other parties with
whom the Partnership regularly conducts business (as determined in the sole and
absolute discretion of the General Partner or Liquidator), and the General
Partner or Liquidator may, or, if required by the Act, shall, publish notice
thereof in a newspaper of general circulation in each place in which the
Partnership regularly conducts business (as determined in the sole and absolute
discretion of the General Partner or Liquidator).

 

Section 13.6                             Cancellation of Certificate of Limited
Partnership.  Upon the completion of the liquidation of the Partnership cash and
property as provided in Section 13.2 hereof, the Partnership shall be
terminated, a certificate of cancellation shall be filed with the State of
Maryland, all qualifications of the Partnership as a foreign limited partnership
or association in jurisdictions other than the State of Maryland shall be
cancelled, and such other actions as may be necessary to terminate the
Partnership shall be taken.

 

Section 13.7                             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 hereof, in order to minimize any losses otherwise attendant upon
such winding-up, and the provisions of this Agreement shall remain in effect
between and among the Partners during the period of liquidation.

 

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ARTICLE 14
PROCEDURES FOR ACTIONS AND CONSENTS
OF PARTNERS; AMENDMENTS; MEETINGS

 

Section 14.1                             Actions and Consents of Partners.  The
actions requiring Consent of any Partner pursuant to this Agreement, including
Section 7.3 hereof, or otherwise pursuant to applicable law, are subject to the
procedures set forth in this Article 14.

 

Section 14.2                             Amendments.  Except as otherwise
required or permitted by this Agreement (including Section 7.3), amendments to
this Agreement must be approved by the Consent of the General Partner and the
Consent of the Partners, and may be proposed only by the General Partner. 
Following such proposal, the General Partner shall submit to the Partners any
proposed amendment that, pursuant to the terms of this Agreement, requires the
Consent of the Partners.  The General Partner shall seek the Consent of the
Partners entitled to vote thereon on any such proposed amendment in accordance
with Section 14.3 hereof.  Upon obtaining any such Consent, or any other Consent
required by this Agreement, and without further action or execution by any other
Person, including any Limited Partner, (i) any amendment to this Agreement may
be implemented and reflected in a writing executed solely by the General
Partner, and (ii) the Limited Partners shall be deemed a party to and bound by
such amendment of this Agreement.  Within thirty days after the effectiveness of
any amendment to this Agreement that does not receive the Consent of all
Partners, the General Partner shall deliver a copy of such amendment to all
Partners that did not Consent to such amendment.  For the avoidance of doubt,
notwithstanding anything to the contrary in this Agreement, this Agreement may
not be amended without the Consent of the General Partner.

 

Section 14.3                             Procedures for Meetings and Actions of
the Partners.

 

A.                                    Meetings of the Partners may be called
only by the General Partner.  The call shall state the nature of the business to
be transacted.  Notice of any such meeting shall be given to all Partners
entitled to act at the meeting not less than ten (10) days nor more than ninety
(90) days prior to the date of such meeting.  Partners may vote in person or by
proxy at such meeting.  Unless approval by a different number or proportion of
the Partners is required by this Agreement, or any Partnership Unit Designation,
the affirmative vote of a Majority in Interest of the Partners shall be
sufficient to approve such proposal at a meeting of the Partners.  Whenever the
Consent of any Partners is permitted or required under this Agreement, such
Consent may be given at a meeting of Partners or in accordance with the
procedure prescribed in Section 14.3.B hereof.

 

B.                                    Any action requiring the Consent of any
Partner or a group of Partners pursuant to this Agreement, or that is required
or permitted to be taken at a meeting of the Partners may be taken without a
meeting if a Consent in writing or by electronic transmission setting forth the
action so taken or consented to is given by Partners whose affirmative vote
would be sufficient to approve such action or provide such Consent at a meeting
of the Partners.  Such Consent may be in one instrument or in several
instruments, and shall have the same force and effect as the affirmative vote of
such Partners at a meeting of the Partners.  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.  For purposes of obtaining a
Consent in writing or by electronic transmission, 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
that is consistent with the General Partner’s recommendation with respect to the
proposal; provided, however, that an action shall become effective at such time
as requisite Consents are received even if prior to such specified time.

 

C.                                    Each Partner entitled to act at a meeting
of Partners may authorize any Person or Persons to act for it by proxy on all
matters in which a Partner is entitled to participate, including waiving notice
of any meeting, or voting or participating at a meeting.  Each proxy must be
signed by the Partner or its 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 (or there is receipt of a proxy authorizing a later
date).  Every proxy shall be revocable at the pleasure of the Partner executing
it, such revocation to be effective upon the Partnership’s receipt of written
notice of such revocation from the Partner executing such proxy, unless such
proxy states that it is irrevocable and is coupled with an interest.

 

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D.                                    The General Partner may set, in advance, a
record date for the purpose of determining the Partners (i) entitled to Consent
to any action, (ii) entitled to receive notice of or vote at any meeting of the
Partners or (iii) in order to make a determination of Partners for any other
proper purpose.  Such date, in any case, shall not be prior to the close of
business on the day the record date is fixed and shall be not more than ninety
(90) days and, in the case of a meeting of the Partners, not less than ten
(10) days, before the date on which the meeting is to be held.  If no record
date is fixed, the record date for the determination of Partners entitled to
notice of or to vote at a meeting of the Partners shall be at the close of
business on the day on which the notice of the meeting is sent, and the record
date for any other determination of Partners shall be the effective date of such
Partner action, distribution or other event.  When a determination of the
Partners entitled to vote at any meeting of the Partners has been made as
provided in this section, such determination shall apply to any adjournment
thereof.

 

E.                                     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 in its sole and absolute
discretion.  Without limitation, meetings of Partners may be conducted in the
same manner as meetings of the Special Limited Partner’s stockholders and may be
held at the same time as, and as part of, the meetings of the Special Limited
Partner’s stockholders.

 

ARTICLE 15
GENERAL PROVISIONS

 

Section 15.1                             Redemption Rights of Qualifying
Parties.

 

A.                                    After the Twelve-Month Period applicable
to such Partnership Common Units, a Qualifying Party shall have the right
(subject to the terms and conditions set forth herein) to require the
Partnership to redeem all or a portion of the Partnership Common Units held by
such Tendering Party (Partnership Common Units that have in fact been tendered
for redemption being hereafter referred to as “Tendered Units”) in exchange (a
“Redemption”) for the Cash Amount payable on the Specified Redemption Date.  The
Partnership may, in the General Partner’s sole and absolute discretion, redeem
Tendered Units at the request of the Holder thereof prior to the end of the
applicable Twelve-Month Period (subject to the terms and conditions set forth
herein) (a “Special Redemption”); provided that, unless waived by the Special
Limited Partner, the General Partner first receives a legal opinion to the same
effect as the legal opinion described in Section 15.1G(4) of this Agreement. 
Any Redemption shall be exercised pursuant to a Notice of Redemption delivered
to the General Partner by the Qualifying Party when exercising the Redemption
right (the “Tendering Party”).  The Partnership’s obligation to effect a
Redemption, however, shall not arise or be binding against the Partnership
(i) until and unless the Special Limited Partner declines or fails to exercise
its purchase rights pursuant to Section 15.1.B hereof following receipt of a
Notice of Redemption (a “Declination”) and (ii) until the Business Day following
the Cut-Off Date.  In the event of a Redemption, the Cash Amount shall be
delivered as a certified or bank check payable to the Tendering Party or, in the
General Partner’s sole and absolute discretion, in immediately available funds
on or before the Specified Redemption Date.

 

B.                                    Notwithstanding the provisions of
Section 15.1.A hereof, on or before the close of business on the Cut-Off Date,
the Special Limited Partner may, in its sole and absolute discretion, elect to
acquire some or all (such percentage being referred to as the “Applicable
Percentage”) of the Tendered Units from the Tendering Party in exchange for the
REIT Shares Amount calculated based on the portion of Tendered Units it elects
to acquire in exchange for REIT Shares.  If the Special Limited Partner so
elects, on the Specified Redemption Date the Tendering Party shall sell such
number of the Tendered Units to the Special Limited Partner in exchange for a
number of REIT Shares equal to the product of the REIT Shares Amount and the
Applicable Percentage.  The Tendering Party shall submit (i) such information,
certification or affidavit as the Special Limited Partner may reasonably require
in connection with the application of the Ownership Limit to any such
acquisition and (ii) such written representations, investment letters, legal
opinions or other instruments necessary, in the Special Limited Partner’s view,
to effect compliance with the Securities Act.  In the event of a purchase of the
Tendered Units by the Special Limited Partner pursuant to this Section 15.1.B,
the Tendering Party shall no longer have the right to cause the Partnership to
effect a Redemption of such Tendered Units, and, upon notice to the Tendering
Party by the Special Limited Partner, given on or before the close of business
on the Cut-Off Date, that the Special Limited Partner has elected to acquire
some or all of the Tendered Units pursuant to this Section 15.1.B, the
obligation of the

 

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Partnership to effect a Redemption of the Tendered Units as to which the Special
Limited Partner’s notice relates shall not accrue or arise.  A number of REIT
Shares equal to the product of the Applicable Percentage and the REIT Shares
Amount, if applicable, shall be delivered by the Special Limited Partner as duly
authorized, validly issued, fully paid and non-assessable REIT Shares and, if
applicable, Rights, free of any pledge, lien, encumbrance or restriction, other
than the Ownership Limit and other restrictions provided in the Charter, the
Securities Act and relevant state securities or “blue sky” laws.  Neither any
Tendering Party whose Tendered Units are acquired by the Special Limited Partner
pursuant to this Section 15.1.B, any Partner, any Assignee nor any other
interested Person shall have any right to require or cause the Special Limited
Partner to register, qualify or list any REIT Shares owned or held by such
Person, whether or not such REIT Shares are issued pursuant to this
Section 15.1.B, with the SEC, with any state securities commissioner, department
or agency, under the Securities Act or the Exchange Act or with any stock
exchange; provided, however, that this limitation shall not be in derogation of
any registration or similar rights granted pursuant to any other written
agreement between the Special Limited Partner and any such Person. 
Notwithstanding any delay in such delivery, the Tendering Party shall be deemed
the owner of such REIT Shares and Rights for all purposes, including, without
limitation, rights to vote or consent, receive dividends, and exercise rights,
as of the Specified Redemption Date.  REIT Shares issued upon an acquisition of
the Tendered Units by the Special Limited Partner pursuant to this
Section 15.1.B may contain such legends regarding restrictions under the
Securities Act and applicable state securities laws as the Special Limited
Partner in good faith determines to be necessary or advisable in order to ensure
compliance with such laws.

 

C.                                    Notwithstanding the provisions of
Sections 15.1.A, 15.1.B and 15.1.H hereof, (i) no Person shall 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 on the
Specified Redemption Date could cause such Person (or any other Person) to
violate the restrictions on ownership and transfer of REIT Shares set forth in
the Charter, after giving effect to any waivers or modifications of such
restrictions by the Board of Directors, and (ii) no Person shall have any rights
under this Agreement to acquire REIT Shares which would otherwise be prohibited
under the Charter, after giving effect to any waivers or modifications of such
restrictions by the Board of Directors.  To the extent that any attempted
Redemption or acquisition of the Tendered Units by the Special Limited Partner
pursuant to Section 15.1.B hereof would be in violation of this Section 15.1.C,
it shall be null and void ab initio, and the Tendering Party shall not acquire
any rights or economic interests in the Cash Amount otherwise payable upon such
Redemption or the REIT Shares otherwise issuable by the Special Limited Partner
under Section 15.1.B hereof.

 

D.                                    In the event of a Declination:

 

(1)                                 The Special Limited Partner shall give
notice of such Declination to the Tendering Party on or before the close of
business on the Cut-Off Date.  The failure of the Special Limited Partner to
give notice of such Declination by the close of business on the Cut-Off Date
shall be deemed to be an election by the Special Limited Partner to acquire the
Tendered Units in exchange for REIT Shares.

 

(2)                                 The Partnership may elect to raise funds for
the payment of the Cash Amount either (a) by requiring that the Special Limited
Partner contribute to the Partnership funds from the proceeds of a registered
public offering by the Special Limited Partner of REIT Shares sufficient to
purchase the Tendered Units or (b) from any other sources (including, but not
limited to, the sale of any Property and the incurrence of additional Debt)
available to the Partnership.

 

(3)                                 If the Cash Amount is not paid on or before
the Specified Redemption Date, interest shall accrue with respect to the Cash
Amount from the day after the Specified Redemption Date to and including the
date on which the Cash Amount is paid at a rate equal to the Applicable Federal
Short-Term Rate as published monthly by the IRS.

 

E.                                     Notwithstanding the provisions of
Section 15.1.B hereof or Section 15.1.H hereof, if the Special Limited Partner’s
acquisition of Tendered Units in exchange for the REIT Shares Amount would be
prohibited under the Charter, then (i) the Special Limited Partner shall not
elect to acquire such Tendered Units, and (ii) the Partnership shall not be
obligated to effect a Redemption of such Tendered Units.

 

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F.                                      Notwithstanding anything herein to the
contrary (but subject to Section 15.1.C hereof), with respect to any Redemption
(or any tender of Partnership Common Units for Redemption if the Tendered Units
are acquired by the Special Limited Partner pursuant to Section 15.1.B hereof)
pursuant to this Section 15.1:

 

(1)                                 Without the consent of the General Partner,
no Tendering Party may effect a Redemption for less than two thousand (2,000)
Partnership Common Units or, if such Tendering Party holds less than two
thousand (2,000) Partnership Common Units, all of the Partnership Common Units
held by such Tendering Party.

 

(2)                                 If (i) a Tendering Party surrenders Tendered
Units during the period after the Partnership Record Date with respect to a
distribution payable to Holders of Partnership Common Units, and before the
record date established by the Special Limited Partner for a dividend to its
stockholders of some or all of its portion of such Partnership distribution, and
(ii) the Special Limited Partner elects to acquire any of such Tendered Units in
exchange for REIT Shares pursuant to Section 15.1.B, then such Tendering Party
shall pay to the Special Limited Partner on the Specified Redemption Date an
amount in cash equal to the Partnership distribution paid or payable in respect
of such Tendered Units.

 

(3)                                 The consummation of such Redemption (or an
acquisition of Tendered Units by the Special Limited Partner pursuant to
Section 15.1.B hereof, as the case may be) shall be subject to the expiration or
termination of the applicable waiting period, if any, under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

 

(4)                                 The Tendering Party shall continue to own
(subject, in the case of an Assignee, to the provisions of Section 11.5 hereof)
all Partnership Common Units subject to any Redemption, and be treated as a
Limited Partner or an Assignee, as applicable, with respect to such Partnership
Common Units for all purposes of this Agreement, until the Specified Redemption
Date and until such Tendered Units are either paid for by the Partnership
pursuant to Section 15.1.A hereof or transferred to the Special Limited Partner
and paid for, by the issuance of REIT Shares, pursuant to Section 15.1.B.  Until
a Specified Redemption Date and an acquisition of the Tendered Units by the
Special Limited Partner pursuant to Section 15.1.B hereof, the Tendering Party
shall have no rights as a stockholder of the Special Limited Partner with
respect to the REIT Shares issuable in connection with such acquisition.

 

G.                                    In connection with an exercise of
Redemption rights pursuant to this Section 15.1, unless waived by the Special
Limited Partner, the Tendering Party shall submit the following to the Special
Limited Partner, in addition to the Notice of Redemption:

 

(1)                                 A written affidavit, dated the same date as
the Notice of Redemption, (a) disclosing the actual and constructive ownership,
as determined for purposes of Code Sections 856(a)(6) and 856(h), of REIT Shares
by (i) such Tendering Party and (ii) to the best of such Tendering Party’s
knowledge, any Related Party, and (b) representing that, after giving effect to
an acquisition of the Tendered Units by the Special Limited Partner pursuant to
Section 15.1.B hereof, neither the Tendering Party nor, to the best of such
Tendering Party’s knowledge, any Related Party, will own REIT Shares in excess
of the Ownership Limit;

 

(2)                                 A written representation that neither the
Tendering Party nor, to the best of such Tendering Party’s knowledge, any
Related Party, has any intention to acquire any additional REIT Shares prior to
the Specified Redemption Date; and

 

(3)                                 An undertaking to certify, at and as a
condition to the closing of (i) the Redemption or (ii) the acquisition of the
Tendered Units by the Special Limited Partner pursuant to Section 15.1.B hereof
on the Specified Redemption Date, that either (a) the actual and constructive
ownership of REIT Shares by the Tendering Party and, to the best of such
Tendering Party’s knowledge, any Related Party, remain unchanged from that
disclosed in the affidavit required by Section 15.1G(1), or (b) after giving
effect to the Redemption or an acquisition of the

 

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Tendered Units by the Special Limited Partner pursuant to Section 15.1.B hereof,
neither the Tendering Party nor, to the best of such Tendering Party’s
knowledge, any Related Party, shall own REIT Shares in violation of the
Ownership Limit.

 

(4)                                 In connection with any Special Redemption,
the Special Limited Partner shall have the right to require an opinion of
counsel reasonably satisfactory to it to the effect that the proposed Special
Redemption will not cause the Partnership, the General Partner or the Special
Limited Partner to violate any Federal or state securities laws or regulations
applicable to the Special Redemption or the issuance and sale of REIT Shares to
the Tendering Party pursuant to Section 15.1.B of this Agreement.

 

H.                                   Stock Offering Funding Option

 

(1)                                 (a)                                
Notwithstanding Sections 15.1.A or 15.1.B hereof (but subject to Sections 15.1.C
and 15.1.E hereof), if (i) a Limited Partner has delivered to the General
Partner a Notice of Redemption with respect to a number of Excess Units that,
together with any other Tendered Units that such Limited Partner agrees to treat
as Excess Units (collectively, the “Offering Units”), exceeds $50,000,000 gross
value, based on a Partnership Common Unit price equal to the Value of a REIT
Share, and (ii) the Special Limited Partner is eligible to file a registration
statement under Form S-3 (or any successor form similar thereto), then:  (x) the
General Partner and the Special Limited Partner may cause the Partnership to
redeem the Offering Units with the proceeds of an offering, whether registered
under the Securities Act or exempt from such registration, underwritten, offered
and sold directly to investors or through agents or other intermediaries, or
otherwise distributed (a “Stock Offering Funding”) of a number of REIT Shares
(“Offered Shares”) equal to the REIT Shares Amount with respect to the Offering
Units pursuant to the terms of this Section 15.1.H; (y) the Partnership may
elect to pay the Cash Amount with respect to the Excess Units pursuant to the
terms of Section 15.1.A; or (z) the Special Limited Partner may elect to acquire
the Excess Units in exchange for the REIT Shares Amount pursuant to the terms of
Section 15.1.B, but only if the Tendering Party provides the General Partner
with any representations or undertakings which the Special Limited Partner has
determined, in its sole and absolute discretion, are sufficient to prevent a
violation of the Charter.  The General Partner and the Special Limited Partner
must provide notice of their exercise of the election described in
clause (x) above to purchase the Tendered Units through a Stock Offering Funding
on or before the Cut-Off Date.

 

(b)                                                                                
If the General Partner and the Special Limited Partner elect a Stock Offering
Funding with respect to a Notice of Redemption, the General Partner may give
notice (a “Single Funding Notice”) of such election to all Limited Partners and
require that all Limited Partners elect whether or not to effect a Redemption to
be funded through such Stock Offering Funding.  If a Limited Partner elects to
effect such a Redemption, it shall give notice thereof and of the number of
Common Units to be made subject thereto in writing to the General Partner within
10 Business Days after receipt of the Single Funding Notice, and such Limited
Partner shall be treated as a Tendering Party for all purposes of this
Section 15.1.H.

 

(2)                                 If the General Partner and the Special
Limited Partner elect a Stock Offering Funding, on the Specified Redemption
Date, the Partnership shall redeem each Offering Unit that is still a Tendered
Unit on such date for cash in immediately available funds in an amount (the
“Stock Offering Funding Amount”) equal to the net proceeds per Offered Share
received by the Special Limited Partner from the Stock Offering Funding,
determined after deduction of underwriting discounts and commissions but no
other expenses of the Special Limited Partner or any other Limited Partner
related thereto, including without limitation, legal and accounting fees and
expenses, SEC registration fees, state blue sky and securities laws fees and
expenses, printing expenses, FINRA filing fees, exchange listing fees and other
out of pocket expenses (the “Net Proceeds”).

 

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(3)                                 If the General Partner and the Special
Limited Partner elect a Stock Offering Funding, the following additional terms
and conditions shall apply:

 

(a)                                 As soon as practicable after the General
Partner and the Special Limited Partner elect to effect a Stock Offering
Funding, the Special Limited Partner shall use its commercially reasonable
efforts to effect promptly a registration, qualification or compliance
(including, without limitation, the execution of an undertaking to file
post-effective amendments, appropriate qualifications under applicable blue sky
or other state securities laws and appropriate compliance with applicable
regulations issued under the Securities Act and any other governmental
requirements or regulations) as would permit or facilitate the sale and
distribution of the Offered Shares; provided, that, if the Special Limited
Partner shall deliver a certificate to the Tendering Party stating that the
Special Limited Partner has determined in the good faith judgment of the Board
of Directors of the Special Limited Partner that such filing, registration or
qualification would require disclosure of material non-public information, the
disclosure of which would have a material adverse effect on the Special Limited
Partner, then the Special Limited Partner may delay making any filing or delay
the effectiveness of any registration or qualification for the shorter of
(a) the period ending on the date upon which such information is disclosed to
the public or ceases to be material or (b) an aggregate period of ninety (90)
days in connection with any Stock Offering Funding.

 

(b)                                 The Special Limited Partner shall advise
each Tendering Party, regularly and promptly upon any request, of the status of
the Stock Offering Funding process, including the timing of all filings, the
selection of and understandings with underwriters, agents, dealers and brokers,
the nature and contents of all communications with the SEC and other
governmental bodies, the expenses related to the Stock Offering Funding as they
are being incurred, the nature of marketing activities, and any other matters
reasonably related to the timing, price and expenses relating to the Stock
Offering Funding and the compliance by the Special Limited Partner with its
obligations with respect thereto.  The Special Limited Partner will have
reasonable procedures whereby the Tendering Party with the largest number of
Offered Units (the “Lead Tendering Party”) may represent all the Tendering
Parties in connection with the Stock Offering Funding by allowing it to
participate in meetings with the underwriters of the Stock Offering Funding.  In
addition, the Special Limited Partner and each Tendering Party may, but shall be
under no obligation to, enter into understandings in writing (“Pricing
Agreements”) whereby the Tendering Party will agree in advance as to the
acceptability of a Net Proceeds amount at or below a specified amount. 
Furthermore, the Special Limited Partner shall establish pricing notification
procedures with each such Tendering Party, such that the Tendering Partner will
have the maximum opportunity practicable to determine whether to become a
Withdrawing Partner pursuant to Section 15.1.H(3)(c) below.

 

(c)                                  The Special Limited Partner will permit the
Lead Tendering Party to participate in the pricing discussions for the Stock
Offering Funding and, upon notification of the price per REIT Share in the Stock
Offering Funding from the managing underwriter(s), in the case of a registered
public offering, or lead placement agent(s), in the event of an unregistered
offering, engaged by the Special Limited Party in order to sell the Offered
Shares, shall immediately use its reasonable efforts to notify each Tendering
Party of the price per REIT Share in the Stock Offering Funding and resulting
Net Proceeds.  Each Tendering Party shall have one hour from the receipt of such
written notice (as such time may be extended by the Special Limited Partner) to
elect to withdraw its Redemption (a Tendering Party making such an election
being a “Withdrawing Partner”), and Partnership Common Units with a REIT Shares
Amount equal to such excluded Offered Shares shall be considered to be withdrawn
from the related Redemption; provided, however, that the Special Limited Partner
shall keep each of the Tendering Parties reasonably informed as to the likely
timing of delivery of its notice.  If a Tendering Party, within such time
period, does not notify the Special Limited Partner of such Tendering Party’s
election not to become a Withdrawing Partner, then such Tendering Party shall,
except as otherwise provided in a Pricing Agreement, be deemed not to have
withdrawn from the Redemption, without liability to the Special Limited
Partner.  To the extent that the Special

 

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Limited Partner is unable to notify any Tendering Party, such unnotified
Tendering Party shall, except as otherwise provided in any Pricing Agreement, be
deemed not to have elected to become a Withdrawing Partner.  Each Tendering
Party whose Redemption is being funded through the Stock Offering Funding who
does not become a Withdrawing Partner shall have the right, subject to the
approval of the managing underwriter(s) or placement agent(s) and restrictions
of any applicable securities laws, to submit for Redemption additional
Partnership Common Units in a number no greater than the number of Partnership
Common Units withdrawn.  If more than one Tendering Party so elects to redeem
additional Partnership Common Units, then such Partnership Common Units shall be
redeemed on a pro rata basis, based on the number of additional Partnership
Common Units sought to be so redeemed.

 

(d)                                 The Special Limited Partner shall take all
reasonable action in order to effectuate the sale of the Offered Shares
including, but not limited to, the entering into of an underwriting or placement
agreement in customary form with the managing underwriter(s) or placement
agent(s) selected for such underwriting.  Notwithstanding any other provision of
this Agreement, if the managing underwriter(s) or placement agent(s) advises the
Special Limited Partner in writing that marketing factors require a limitation
of the number of shares to be offered, then the Special Limited Partner shall so
advise all Tendering Parties and the number of Partnership Common Units to be
sold to the Special Limited Partner pursuant to the Redemption shall be
allocated among all Tendering Parties in proportion, as nearly as practicable,
to the respective number of Partnership Common Units as to which each Tendering
Party elected to effect a Redemption.  Notwithstanding anything to the contrary
in this Agreement, if the Special Limited Partner is also offering to sell
shares for purposes other than to fund the redemption of Offering Units and to
pay related expenses, then those other shares may in the Special Limited
Partner’s sole discretion be given priority over any shares to be sold in the
Stock Offering Funding, and any shares to be sold in the Stock Offering Funding
shall be removed from the offering prior to removing shares the proceeds of
which would be used for other purposes of the Special Limited Partners.  No
Offered Shares excluded from the underwriting by reason of the managing
underwriter’s or placement agent’s marketing limitation shall be included in
such offering.

 

Section 15.2                             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 first class United States mail
or by other means of written or electronic communication (including by telecopy,
facsimile, electronic mail or commercial courier service) to the Partner, or
Assignee at the address for such Partner set forth in the Register, or such
other address of which the Partner shall notify the General Partner in
accordance with this Section 15.2.

 

Section 15.3                             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” or “Sections” are to
Articles and Sections of this Agreement.

 

Section 15.4                             Pronouns and Plurals.  Whenever the
context may require, any pronouns 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 15.5                             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.

 

Section 15.6                             Binding Effect.  This Agreement shall
be binding upon and inure to the benefit of the parties hereto and their heirs,
executors, administrators, successors, legal representatives and permitted
assigns.

 

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Section 15.7                             Waiver.

 

A.                                    No failure 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 a breach thereof
shall constitute waiver of any such breach or any other covenant, duty,
agreement or condition.

 

B.                                    The restrictions, conditions and other
limitations on the rights and benefits of the Limited Partners contained in this
Agreement, and the duties, covenants and other requirements of performance or
notice by the Limited Partners, are for the benefit of the Partnership and,
except for an obligation to pay money to the Partnership, may be waived or
relinquished by the General Partner, in its sole and absolute discretion, on
behalf of the Partnership in one or more instances from time to time and at any
time; provided, however, that any such waiver or relinquishment may not be made
if it would have the effect of (i) creating liability for any other Limited
Partner, (ii) causing the Partnership to cease to qualify as a limited
partnership, (iii) reducing the amount of cash otherwise distributable to the
Limited Partners (other than any such reduction that affects all of the Limited
Partners holding the same class or series of Partnership Units on a uniform or
pro rata basis, if approved by a Majority in Interest of the Limited Partners
holding such class or series of Partnership Units), (iv) resulting in the
classification of the Partnership as an association or publicly traded
partnership taxable as a corporation or (v) violating the Securities Act, the
Exchange Act or any state “blue sky” or other securities laws; provided,
further, that any waiver relating to compliance with the Ownership Limit or
other restrictions in the Charter shall be made and shall be effective only as
provided in the Charter.

 

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; Consent to
Jurisdiction; Jury Trial.

 

A.                                    This Agreement shall be construed and
enforced in accordance with and governed by the laws of the State of Maryland,
without regard to the principles of conflicts of law.  In the event of a
conflict between any provision of this Agreement and any non-mandatory provision
of the Act, the provisions of this Agreement shall control and take precedence.

 

B.                                    Each Partner hereby (i) submits to the
non-exclusive jurisdiction of any state or federal court sitting in the State of
Maryland (collectively, the “Maryland Courts”), with respect to any dispute
arising out of this Agreement or any transaction contemplated hereby to the
extent such courts would have subject matter jurisdiction with respect to such
dispute, (ii) irrevocably waives, and agrees not to assert by way of motion,
defense, or otherwise, in any such action, any claim that it is not subject
personally to the jurisdiction of any of the Maryland Courts, that its property
is exempt or immune from attachment or execution, that the action is brought in
an inconvenient forum, or that the venue of the action is improper, (iii) agrees
that notice or the service of process in any action, suit or proceeding arising
out of or relating to this Agreement or the transactions contemplated hereby
shall be properly served or delivered if delivered to such Partner at such
Partner’s last known address as set forth in the Partnership’s books and
records, and (iv) IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.

 

Section 15.10                      Entire Agreement.  This Agreement contains
all of the understandings and agreements between and among the Partners with
respect to the subject matter of this Agreement and the rights, interests and
obligations of the Partners with respect to the Partnership.  Notwithstanding
any provision in this Agreement or any Partnership Unit Designation to the
contrary, including any provisions relating to amending this Agreement, the
Partners hereby acknowledge and agree that the General Partner, without the
approval of any Limited Partner, may enter into side letters or similar written
agreements with Limited Partners that are not Affiliates of the General Partner
or the Special Limited Partner, executed contemporaneously with the admission of
such Limited Partner to the Partnership, which may have the effect of
establishing rights under, or altering or supplementing the terms of, this
Agreement or any Partnership Unit Designation, as negotiated with such Limited
Partner and which the General Partner in its sole discretion deems necessary,
desirable or appropriate.  The parties

 

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hereto agree that any terms, conditions or provisions contained in such side
letters or similar written agreements with a Limited Partner shall govern with
respect to such Limited Partner notwithstanding the provisions of this
Agreement.

 

Section 15.11                      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 15.12                      Limitation to Preserve REIT Status. 
Notwithstanding anything else in this Agreement, with respect to any period in
which the Special Limited Partner has elected to be treated as a REIT for
Federal income tax purposes, to the extent that the amount paid, credited,
distributed or reimbursed by the Partnership to any REIT Partner or its
officers, directors, employees or agents, whether as a reimbursement, fee,
expense or indemnity (a “REIT Payment”), would constitute gross income to the
REIT Partner for purposes of Code Section 856(c)(2) or Code Section 856(c)(3),
then, notwithstanding any other provision of this Agreement, the amount of such
REIT Payments, as selected by the General Partner in its discretion from among
items of potential distribution, reimbursement, fees, expenses and indemnities,
shall be reduced for any Partnership Year so that the REIT Payments, as so
reduced, for or with respect to such REIT Partner shall not exceed the lesser
of:

 

(i)                                     an amount equal to the excess, if any,
of (a) four and nine-tenths percent (4.9%) of the REIT Partner’s total gross
income (but excluding the amount of any REIT Payments) for the Partnership Year
that is described in subsections (A) through (I) of Code Section 856(c)(2) over
(b) the amount of gross income (within the meaning of Code Section 856(c)(2))
derived by the REIT Partner from sources other than those described in
subsections (A) through (I) of Code Section 856(c)(2) (but not including the
amount of any REIT Payments); or

 

(ii)                                  an amount equal to the excess, if any, of
(a) twenty-four percent (24%) of the REIT Partner’s total gross income (but
excluding the amount of any REIT Payments) for the Partnership Year that is
described in subsections (A) through (I) of Code Section 856(c)(3) over (b) the
amount of gross income (within the meaning of Code Section 856(c)(3)) derived by
the REIT Partner from sources other than those described in
subsections (A) through (I) of Code Section 856(c)(3) (but not including the
amount of any REIT Payments);

 

provided, however, that REIT Payments in excess of the amounts set forth in
clauses (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 should not adversely affect the REIT Partner’s ability to qualify as a
REIT.  To the extent that REIT Payments may not be made in a Partnership Year as
a consequence of the limitations set forth in this Section 15.12, such REIT
Payments shall carry over and shall be treated as arising in the following
Partnership Year if such carry over does not adversely affect the REIT Partner’s
ability to qualify as a REIT, provided, however, that any such REIT Payment
shall not be carried over more than three Partnership Years, and any such
remaining payments shall no longer be due and payable.  The purpose of the
limitations contained in this Section 15.12 is to prevent any REIT Partner from
failing to qualify as a REIT under the Code by reason of such REIT Partner’s
share of items, including distributions, reimbursements, fees, expenses or
indemnities, receivable directly or indirectly from the Partnership, and this
Section 15.12 shall be interpreted and applied to effectuate such purpose.

 

Section 15.13                      REIT Restrictions.  Each Affiliated REIT is a
REIT and is subject to the provisions of Sections 856 through and including 860
of the Code.  So long as an Affiliated REIT owns, directly or indirectly, any
interest in the Partnership, then notwithstanding any other provision of this
Agreement:

 

(i)                                     any services that would otherwise cause
any rents from a lease to be excluded from treatment as rents from real property
pursuant to Section 856(d)(2)(C) of the Code shall be provided by either (1) an
independent contractor (as described in Section 856(d)(3) of the Code) with
respect to such Affiliated REIT and from whom neither the Partnership nor such
Affiliated REIT derives or receives any income or (2) a taxable REIT subsidiary
of such Affiliated REIT as described in Section 856(l) of the Code;

 

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(ii)                                  except for a taxable REIT subsidiary of an
Affiliated REIT, the Partnership shall not own, directly or indirectly or by
attribution (in accordance with attribution rules referred to in
Section 856(d)(5) of the Code), in the aggregate more than 10% of the total
value of all classes of stock or more than 10% of the total voting power (or,
with respect to any such person which is not a corporation, an interest of 10%
or more in the assets or net profits of such person) of a lessee or sublessee of
all or any part of the Property or of any other assets of the Partnership except
in each case with the specific written approval of each Affiliated REIT;

 

(iii)                               except for securities of a taxable REIT
subsidiary of an Affiliated REIT, the Partnership shall not own or acquire,
directly or indirectly or by attribution, more than 10% of the total value or
the total voting power of the outstanding securities of any issuer or own any
other asset (including a security) which would cause the Affiliated REIT to fail
the asset test of Section 856(c)(4)(B) of the Code; and

 

(iv)                              leases entered into by the Partnership or any
of its Subsidiary partnerships, limited partnerships, and limited liability
companies shall provide for rents that qualify as “rents from real property”
within the meaning of Section 856(d) of the Code with respect to each Affiliated
REIT.

 

Section 15.14                      No Partition.  No Partner nor any
successor-in-interest to a Partner shall have the right while this Agreement
remains in effect to have any property of the Partnership partitioned, or to
file a complaint or institute any proceeding at law or in equity to have such
property of the Partnership partitioned, and each Partner, on behalf of itself
and its successors and assigns hereby waives any such right.  It is the
intention of the Partners that the rights of the parties hereto and their
successors-in-interest to Partnership property, as among themselves, shall be
governed by the terms of this Agreement, and that the rights of the Partners and
their respective successors-in-interest shall be subject to the limitations and
restrictions as set forth in this Agreement.

 

Section 15.15                      No Third-Party Rights Created Hereby.  The
provisions of this Agreement are solely for the purpose of defining the
interests of the Holders, inter se; and no other person, firm or entity (i.e., a
party who is not a signatory hereto or a permitted successor to such signatory
hereto) shall have any right, power, title or interest by way of subrogation or
otherwise, in and to the rights, powers, title and provisions of this
Agreement.  No creditor or other third party having dealings with the
Partnership (other than as expressly set forth herein with respect to
Indemnitees) shall have the right to enforce the right or obligation of any
Partner to make Capital Contributions or loans to the Partnership or to pursue
any other right or remedy hereunder or at law or in equity.  None of the rights
or obligations of the Partners herein set forth to make Capital Contributions or
loans to the Partnership shall be deemed an asset of the Partnership for any
purpose by any creditor or other third party, nor may any such rights or
obligations be sold, Transferred or assigned by the Partnership or pledged or
encumbered by the Partnership to secure any debt or other obligation of the
Partnership or any of the Partners.

 

Section 15.16                      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 Special Limited
Partner, including without limitation any right to receive dividends or other
distributions made to stockholders of the Special Limited Partner or to vote or
to consent or receive notice as stockholders in respect of any meeting of
stockholders for the election of directors of the Special Limited Partner or any
other matter.

 

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, this Agreement has been executed as of the date first
written above.

 

 

GENERAL PARTNER:

 

 

 

CYRUSONE GP

 

 

 

By:

CYRUSONE INC., trustee

 

 

 

 

 

By:

/s/ Robert M. Jackson

 

 

Name: Robert M. Jackson

 

 

Title: Executive Vice President, General Counsel and Secretary

 

 

 

 

 

SPECIAL LIMITED PARTNER:

 

 

 

CYRUSONE INC.

 

 

 

By:

/s/ Robert M. Jackson

 

 

Name: Robert M. Jackson

 

 

Title: Executive Vice President, General Counsel and Secretary

 

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EXHIBIT A:  EXAMPLES REGARDING ADJUSTMENT FACTOR

 

For purposes of the following examples, it is assumed that (a) the Adjustment
Factor in effect on December 31, 2012 is 1.0 and (b) on January 1, 2013 (the
“Partnership Record Date” for purposes of these examples), prior to the events
described in the examples, there are 100 REIT Shares issued and outstanding.

 

Example 1
On the Partnership Record Date, the Special Limited Partner declares a dividend
on its outstanding REIT Shares in REIT Shares.  The amount of the dividend is
one REIT Share paid in respect of each REIT Share owned.  Pursuant to Paragraph
(i) of the definition of “Adjustment Factor,” the Adjustment Factor shall be
adjusted on the Partnership Record Date, effective immediately after the stock
dividend is declared, as follows:

 

1.0 * 200/100 = 2.0

 

Accordingly, the Adjustment Factor after the stock dividend is declared is 2.0.

 

Example 2
On the Partnership Record Date, the Special Limited Partner distributes options
to purchase REIT Shares to all holders of its REIT Shares.  The amount of the
distribution is one option to acquire one REIT Share in respect of each REIT
Share owned.  The strike price is $4.00 a share.  The Value of a REIT Share on
the Partnership Record Date is $5.00 per share.  Pursuant to Paragraph (ii) of
the definition of “Adjustment Factor,” the Adjustment Factor shall be adjusted
on the Partnership Record Date, effective immediately after the options are
distributed, as follows:

 

1.0 * (100 + 100)/(100 + [100 * $4.00/$5.00]) = 1.1111

 

Accordingly, the Adjustment Factor after the options are distributed is 1.1111. 
If the options expire or become no longer exercisable, then the retroactive
adjustment specified in Paragraph (ii) of the definition of “Adjustment Factor”
shall apply.

 

Example 3
On the Partnership Record Date, the Special Limited Partner distributes assets
to all holders of its REIT Shares.  The amount of the distribution is one asset
with a fair market value (as determined by the General Partner) of $1.00 in
respect of each REIT Share owned.  It is also assumed that the assets do not
relate to assets received by the General Partner pursuant to a pro rata
distribution by the Partnership.  The Value of a REIT Share on the Partnership
Record Date is $5.00 a share.  Pursuant to Paragraph (iii) of the definition of
“Adjustment Factor,” the Adjustment Factor shall be adjusted on the Partnership
Record Date, effective immediately after the assets are distributed, as follows:

 

1.0 * $5.00/($5.00 - $1.00) = 1.25

 

Accordingly, the Adjustment Factor after the assets are distributed is 1.25.

 

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EXHIBIT B:  NOTICE OF REDEMPTION

 

CyrusOne GP
1649 West Frankford Road
Carrollton, Texas 75007

 

The undersigned Limited Partner or Assignee hereby irrevocably tenders for
Redemption Partnership Common Units in CyrusOne, LP in accordance with the terms
of the Amended and Restated Agreement of Limited Partnership of CyrusOne, LP,
dated as of May 2, 2016, as amended (the “Agreement”), and the Redemption rights
referred to therein.  All capitalized terms used and not otherwise defined
herein shall have the respective meanings ascribed to them in the Agreement. 
The undersigned Limited Partner or Assignee:

 

(a) undertakes (i) to surrender such Partnership Common Units at the closing of
the Redemption and (ii) to furnish to the Special Limited Partner, prior to the
Specified Redemption Date, the documentation, instruments and information
required under Section 15.1.G of the Agreement;

 

(b) directs that the certified check representing the Cash Amount, or the REIT
Shares Amount, as applicable, deliverable upon the closing of such Redemption be
delivered to the address specified below;

 

(c) represents, warrants, certifies and agrees that:  (i) the undersigned
Limited Partner or Assignee is a Qualifying Party; (ii) the undersigned Limited
Partner or Assignee has, and at the closing of the Redemption will have, good,
marketable and unencumbered title to such Partnership Common Units, free and
clear of the rights or interests of any other person or entity; (iii) the
undersigned Limited Partner or Assignee has, and at the closing of the
Redemption will have, the full right, power and authority to tender and
surrender such Common Units as provided herein; (iv) the undersigned Limited
Partner or Assignee, and the tender and surrender of such Common Units for
Redemption as provided herein complies with all conditions and requirements for
redemption of Partnership Common Units set forth in the Agreement; and (v) the
undersigned Limited Partner or Assignee has obtained the consent or approval of
all persons and entities, if any, having the right to consent to or approve such
tender and surrender; and

 

(d) acknowledges that the undersigned will continue to own such Partnership
Common Units unless and until either (1) such Partnership Common Units are
acquired by the Special Limited Partner pursuant to Section 15.1.B of the
Agreement or (2) such redemption transaction closes.

 

Dated:

 

 

 

 

 

 

 

 

 

 

 

Name of Limited Partner or Assignee:

 

 

 

 

 

 

 

 

Signature of Limited Partner or Assignee

 

 

 

 

 

 

 

 

Street Address

 

 

 

 

 

 

 

 

City, State and Zip Code

 

 

 

 

 

 

 

 

Social security or identifying number

 

 

 

 

 

Signature Medallion Guaranteed by:

 

 

 

 

 

 

 

 

 

 

 

Issue Check Payable to (or shares in the name of):

 

 

 

 

 

 

 

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