EX-10.1 SECOND AMENDED AND RESTATED AGREEMENT



 



Exhibit 10.1




SECOND AMENDED AND RESTATED




AGREEMENT OF LIMITED PARTNERSHIP




OF




MPT OPERATING PARTNERSHIP, L.P.




 









 








TABLE OF CONTENTS




	 	 	 	 	 
	ARTICLE I DEFINED TERMS
	 	 	1	 
	 
	 	 	 	 
	ARTICLE II FORMATION OF PARTNERSHIP
	 	 	8	 
	2.01 Continuation
	 	 	8	 
	2.02 Name, Office and Registered Agent
	 	 	8	 
	2.03 Partners
	 	 	8	 
	2.04 Term and Dissolution
	 	 	8	 
	2.05 Filing of Certificate and Perfection of Limited Partnership
	 	 	9	 
	2.06 Certificates Describing Partnership Units
	 	 	9	 
	 
	 	 	 	 
	ARTICLE III BUSINESS OF THE PARTNERSHIP
	 	 	10	 
	 
	 	 	 	 
	ARTICLE IV CAPITAL CONTRIBUTIONS AND ACCOUNTS
	 	 	10	 
	4.01 Capital Contributions
	 	 	10	 
	4.02 Additional Capital Contributions and Issuances of Additional Partnership Interests
	 	 	10	 
	4.03 Additional Funding
	 	 	13	 
	4.04 Capital Accounts
	 	 	13	 
	4.05 Percentage Interests
	 	 	13	 
	4.06 No Interest on Contributions
	 	 	13	 
	4.07 Return of Capital Contributions
	 	 	14	 
	4.08 No Third Party Beneficiary
	 	 	14	 
	 
	 	 	 	 
	ARTICLE V PROFITS AND LOSSES; DISTRIBUTIONS
	 	 	14	 
	5.01 Allocation of Profit and Loss
	 	 	14	 
	5.02 Distribution of Cash
	 	 	16	 
	5.03 REIT Distribution Requirements
	 	 	17	 
	5.04 No Right to Distributions in Kind
	 	 	17	 
	5.05 Limitations on Return of Capital Contributions
	 	 	17	 
	5.06 Distributions Upon Liquidation
	 	 	17	 
	5.07 Substantial Economic Effect
	 	 	18	 
	 
	 	 	 	 
	ARTICLE VI RIGHTS, OBLIGATIONS AND POWERS OF THE GENERAL PARTNER
	 	 	18	 
	6.01 Management of the Partnership
	 	 	18	 
	6.02 Delegation of Authority
	 	 	21	 
	6.03 Indemnification and Exculpation of Indemnitees
	 	 	21	 
	6.04 Liability of the General Partner
	 	 	23	 
	6.05 Partnership Obligations
	 	 	24	 
	6.06 Outside Activities
	 	 	24	 
	6.07 Employment or Retention of Affiliates
	 	 	24	 
	6.08 General Partner Activities
	 	 	25	 
	6.09 Title to Partnership Assets
	 	 	25	 






 









 






	 	 	 	 	 
	6.10 Redemption of General Partner Partnership Units
	 	 	25	 
	 
	 	 	 	 
	ARTICLE VII CHANGES IN THE COMPANY OR THE GENERAL PARTNER
	 	 	25	 
	7.01 Transfer of the General Partner’s Partnership Interest
	 	 	25	 
	7.02 Admission of a Substitute or Additional General Partner
	 	 	27	 
	7.03 Effect of Bankruptcy, Withdrawal, Death or Dissolution of a General Partner
	 	 	28	 
	7.04 Removal of a General Partner
	 	 	28	 
	 
	 	 	 	 
	ARTICLE VIII RIGHTS AND OBLIGATIONS OF THE LIMITED PARTNERS
	 	 	29	 
	8.01 Management of the Partnership
	 	 	29	 
	8.02 Power of Attorney
	 	 	29	 
	8.03 Limitation on Liability of Limited Partners
	 	 	30	 
	8.04 Redemption Right
	 	 	30	 
	 
	 	 	 	 
	ARTICLE IX TRANSFERS OF PARTNERSHIP INTERESTS
	 	 	32	 
	9.01 Purchase for Investment
	 	 	32	 
	9.02 Restrictions on Transfer of Partnership Interests
	 	 	32	 
	9.03 Admission of Substitute Limited Partner
	 	 	34	 
	9.04 Rights of Assignees of Partnership Interests
	 	 	35	 
	9.05 Effect of Bankruptcy, Death, Incompetence or Termination of a Limited Partner
	 	 	35	 
	9.06 Joint Ownership of Interests
	 	 	35	 
	 
	 	 	 	 
	ARTICLE X BOOKS AND RECORDS; ACCOUNTING; TAX MATTERS
	 	 	36	 
	10.01 Books and Records
	 	 	36	 
	10.02 Custody of Partnership Funds; Bank Accounts
	 	 	36	 
	10.03 Fiscal and Taxable Year
	 	 	36	 
	10.04 Annual Tax Information and Report
	 	 	36	 
	10.05 Tax Matters Partner; Tax Elections; Special Basis Adjustments
	 	 	36	 
	10.06 Reports to Limited Partners
	 	 	37	 
	 
	 	 	 	 
	ARTICLE XI AMENDMENT OF AGREEMENT; MERGER
	 	 	37	 
	 
	 	 	 	 
	ARTICLE XII GENERAL PROVISIONS
	 	 	38	 
	12.01 Notices
	 	 	38	 
	12.02 Survival of Rights
	 	 	38	 
	12.03 Additional Documents
	 	 	38	 
	12.04 Severability
	 	 	38	 
	12.05 Entire Agreement
	 	 	38	 
	12.06 Pronouns and Plurals
	 	 	39	 
	12.07 Headings
	 	 	39	 
	12.08 Counterparts
	 	 	39	 
	12.09 Governing Law
	 	 	39	 






 









 






EXHIBITS




	 
	EXHIBIT A — Partners, Capital Contributions and Percentage Interests

	 

	EXHIBIT B — Notice of Exercise of Redemption Right

	 

	EXHIBIT C — Certification of Non-Foreign Status

	 

	EXHIBIT D — LTIP Units

	 

	EXHIBIT E — Notice of Election by Partner to Convert LTIP Units into Common Units

	 

	EXHIBIT F — Notice of Election by Partnership to Force Conversion of LTIP Units into Common Units







 









 






AMENDED AND RESTATED




AGREEMENT OF LIMITED PARTNERSHIP

OF

MPT OPERATING PARTNERSHIP, L.P.




This Amended and Restated Agreement of Limited Partnership of MPT Operating Partnership, L.P. is
made and entered into as of the 31st day of July, 2007 by and among MPT Operating Partnership,
L.P. (the “Partnership”), Medical Properties Trust, LLC, a Delaware limited liability company and
currently the sole general partner of the Partnership, and Medical Properties Trust, Inc., a
Maryland corporation (the “Company”), as well as the other limited partners who from time to time
execute this Agreement or counterparts hereof as limited partners.



RECITALS:




WHEREAS, the Partnership was formed as a limited partnership under the laws of the State of
Delaware, pursuant to a Certificate of Limited Partnership filed with the Secretary of State of the
State of Delaware effective as of September 10, 2003 and an Agreement of Limited Partnership
entered into as of September 10, 2003;



WHEREAS, the parties desire to amend the Agreement of Limited Partnership and restate it in its
entirety as set forth in this Agreement.



AGREEMENT




NOW, THEREFORE, in consideration of the foregoing, the mutual covenants of the parties hereto, and
other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree that the Agreement of Limited Partnership shall be amended
and restated as follows:



ARTICLE I

DEFINED TERMS




The following defined terms used in this Agreement shall have the meanings specified below:



“ACT” means the Delaware Revised Uniform Limited Partnership Act, as it may be amended from time to
time.



“ADDITIONAL FUNDS” has the meaning set forth in Section 4.03 hereof.



“ADDITIONAL SECURITIES” means any additional REIT Shares (other than REIT Shares issued in
connection with an exchange pursuant to Section 8.04 hereof) or rights, options, warrants or
convertible or exchangeable securities containing the right to subscribe for or purchase REIT
Shares, as set forth in Section 4.02(a)(ii).



“ADMINISTRATIVE EXPENSES” means (i) all administrative and operating costs and expenses incurred by
the Partnership, (ii) those administrative costs and expenses of the General Partner or the
Company, including any salaries or other payments to directors, officers or employees of the
General Partner or the Company, and any accounting and legal expenses of the General Partner or the
Company, which expenses, the Partners have agreed, are expenses of the Partnership and not the
General Partner or the Company, and (iii) to the extent not included in



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clauses (i) or (ii) above, REIT Expenses; provided, however, that Administrative Expenses shall not
include any administrative costs and expenses incurred by the General Partner or the Company that
are attributable to Properties or partnership interests in a Subsidiary Partnership that are owned
by the General Partner or the Company or other than through its ownership interest in the
Partnership.




“AFFILIATE” means, (i) any Person that, directly or indirectly, controls or is controlled by or is
under common control with such Person, (ii) any other Person that owns, beneficially, directly or
indirectly, 10% or more of the outstanding capital stock, shares or equity interests of such
Person, or



(iii) any officer, director, employee, partner, member, manager or trustee of such Person or any
Person controlling, controlled by or under common control with such Person (excluding trustees and
persons serving in similar capacities who are not otherwise an Affiliate of such Person). For the
purposes of this definition, “control” (including the correlative meanings of the terms “controlled
by” and “under common control with”), as used with respect to any Person, shall mean the
possession, directly or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, through the ownership of voting securities or partnership interests or
otherwise.



“AGREED VALUE” means the fair market value of a Partner’s non-cash Capital Contribution (net of
assumed liabilities) as of the date of contribution as agreed to by such Partner and the General
Partner. The names and addresses of the Partners, number of Partnership Units issued to each
Partner, and the Agreed Value of non-cash Capital Contributions as of the date of contribution is
set forth on Exhibit A.



“AGREEMENT” means this Second Amended and Restated Agreement of Limited Partnership, as amended,
modified, supplemented or restated from time to time, as the context requires.



“ARTICLES OF INCORPORATION” means the Articles of Incorporation of the Company filed with the
Maryland State Department of Assessments and Taxation, as amended or restated from time to time.



“BOARD OF DIRECTORS” means the Board of Directors of the Company.



“BOOK VALUE” means, with respect to any Partnership asset, the asset’s adjusted basis for federal
income tax purposes, except as follows: (i) the initial Book Value of any asset contributed (or
deemed contributed) to the Partnership shall be such asset’s fair market value (as determined by
the General Partner, in its sole and absolute discretion, and taking into account Section 7701(g)
of the Code); (ii) the Book Value of all Partnership assets may be adjusted in the event of a
revaluation of Partnership assets in accordance with Section 4.04 hereof; (iii) any adjustments to
the adjusted basis of any asset of the Partnership pursuant to Section 734 or Section 743 of the
Code shall be taken into account in determining such asset’s Book Value in a manner consistent with
Treasury Regulations Section 1.704-1(b)(2)(iv)(m); and (iv) the Book Value of any Partnership asset
distributed or deemed distributed by the Partnership to any Partner shall be adjusted immediately
prior to such distribution to equal its fair market value (as determined by the General Partner, in
its sole and absolute discretion, and taking into account Section 7701(g) of the Code); and if the
Book Value of an asset has been determined pursuant to clause (i), (ii) or
(iii) of this definition, such Book Value shall thereafter be adjusted in the same manner
as would the asset’s adjusted basis for federal income tax purposes, except that depreciation
deductions shall be computed based on the asset’s Book Value as so determined, rather than on its
adjusted tax basis.



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“CAPITAL ACCOUNT” has the meaning provided in Section 4.04 hereof.



“CAPITAL CONTRIBUTION” means the total amount of cash, cash equivalents, and the Agreed Value of
any Property or other asset contributed or agreed to be contributed, as the context requires, to
the Partnership by each Partner pursuant to the terms of the Agreement. Any reference to the
Capital Contribution of a Partner shall include the Capital Contribution made by a predecessor
holder of the Partnership Interest of such Partner.



“CASH AMOUNT” means an amount of cash per Partnership Unit equal to the Value of the REIT Shares
Amount on the date of receipt by the Partnership and the Company of a Notice of Redemption.



“CERTIFICATE” means any instrument or document that is required under the laws of the State of
Delaware, or any other jurisdiction in which the Partnership conducts business, to be signed and
sworn to by the Partners of the Partnership (either by themselves or pursuant to the
power-of-attorney granted to the General Partner in Section 8.02 hereof) and filed for recording in
the appropriate public offices within the State of Delaware or such other jurisdiction to perfect
or maintain the Partnership as a limited partnership, to effect the admission, withdrawal or
substitution of any Partner of the Partnership, or to protect the limited liability of the Limited
Partners as limited partners under the laws of the State of Delaware or such other jurisdiction.



“CODE” means the Internal Revenue Code of 1986, as amended, and as hereafter amended from time to
time. Reference to any particular provision of the Code shall mean that provision in the Code at
the date hereof and any successor provision of the Code.



“COMMISSION” means the U.S. Securities and Exchange Commission.



“COMMON SHARE” means one share of common stock, $.01 par value, of the Company.



“COMMON UNIT”  means a Partnership Unit other than an LTIP Unit.



“COMMON UNIT ECONOMIC BALANCE” means (i) the Capital Account balance of the General Partner, plus
the amount of the General Partner’s share of any Partner Minimum Gain or Partnership Minimum Gain,
in either case to the extent attributable to the General Partner’s ownership of Common Units and
computed on a hypothetical basis after taking into account all allocations through the date on
which any allocation is made under Section 5.01(j), divided by (ii) the number of the General
Partner’s Common Units.



“COMPANY” means Medical Properties Trust, Inc., a Maryland corporation electing to be taxed as a
real estate investment trust under Sections 856 through 860 of the Code.



“CONSTITUENT PERSON” has the meaning set forth in Section 1.13 of Exhibit D hereto.



“CONVERSION FACTOR” means 1.0, provided that in the event that the Company (i) declares or pays a
dividend on its outstanding REIT Shares in REIT Shares or makes a distribution to all holders of
its outstanding REIT Shares in REIT Shares, (ii) subdivides its outstanding REIT Shares or (iii)
combines its outstanding REIT Shares into a smaller number of REIT Shares, the Conversion Factor
shall be adjusted by multiplying the Conversion Factor by a fraction, the numerator of which shall
be the number of REIT Shares issued and outstanding on the record date for such dividend,
distribution, subdivision or combination (assuming for such purposes that such dividend,
distribution, subdivision or combination has occurred as of such time), and the denominator of
which shall be the actual number of REIT Shares (determined without the above



3









 




assumption) issued and outstanding on such date and, provided further, that in the event that an
entity other than an Affiliate of the Company shall become general partner pursuant to any merger,
consolidation or combination of the Company with or into another entity (the “Successor Entity”),
the Conversion Factor shall be adjusted by multiplying the Conversion Factor by the number of
shares of the Successor Entity into which one REIT Share is converted pursuant to such merger,
consolidation or combination, determined as of the date of such merger, consolidation or
combination. Any adjustment to the Conversion Factor shall become effective immediately after the
effective date of such event retroactive to the record date, if any, for such event; provided,
however, that if the Company and the Partnership receive a Notice of Redemption after the record
date, but prior to the effective date of such dividend, distribution, subdivision or combination,
the Conversion Factor shall be determined as if the Company and the Partnership had received the
Notice of Redemption immediately prior to the record date for such dividend, distribution,
subdivision or combination.




“DEFAULTING LIMITED PARTNER” has the meaning set forth in Section 5.02(c) hereof.



“DISTRIBUTABLE AMOUNT” has the meaning set forth in Section 5.02(c) hereof.



“ECONOMIC CAPITAL ACCOUNT BALANCE” with respect to an LTIP Unit Limited Partner means an amount
equal to its Capital Account balance, plus the amount of its share of any Partner Minimum Gain or
Partnership Minimum Gain, in either case to the extent attributable to its ownership of LTIP Units.



“EVENT OF BANKRUPTCY” as to any Person means the filing of a petition for relief as to such Person
as debtor or bankrupt under the Bankruptcy Code of 1978 or similar provision of law of any
jurisdiction (except if such petition is contested by such Person and has been dismissed within 90
days); insolvency or bankruptcy of such Person as finally determined by a court proceeding; filing
by such Person of a petition or application to accomplish the same or for the appointment of a
receiver or a trustee for such Person or a substantial part of his assets; commencement of any
proceedings relating to such Person as a debtor under any other reorganization, arrangement,
insolvency, adjustment of debt or liquidation law of any jurisdiction, whether now in existence or
hereinafter in effect, either by such Person or by another, provided that if such proceeding is
commenced by another, such Person indicates his approval of such proceeding, consents thereto or
acquiesces therein, or such proceeding is contested by such Person and has not been finally
dismissed within 90 days.



“GENERAL PARTNER” means Medical Properties Trust, LLC and any Person who becomes a substitute or
additional General Partner as provided herein, and any of their successors as General Partner.



“GENERAL PARTNERSHIP INTEREST” means a Partnership Interest held by the General Partner that is a
general partnership interest.



“GENERAL PARTNER LOAN” has the meaning set forth in Section 5.02(c) hereof.



“INDEMNITEE” means (i) any Person made a party to a proceeding by reason of its status as the
Company, the General Partner or a director, officer or employee of the Company, the Partnership or
the General Partner, and (ii) such other Persons (including Affiliates of the Company, General
Partner or the Partnership) as the General Partner may designate from time to time, in its sole and
absolute discretion.



“INELIGIBLE UNIT” has the meaning set forth in Section 5.01(j)(i).



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“LTIP UNIT” means, a Partnership Unit designated as such having the rights, powers, privileges,
restrictions, qualifications and limitations set forth in Exhibit D hereto.



“LTIP UNIT ADJUSTMENT EVENTS” has the meaning set forth in Section 1.7 of Exhibit D hereto.



“LTIP UNIT CAPITAL” means, with respect to any LTIP Unit, the amount of Capital Contributions made
with respect to such LTIP Unit.



LTIP UNIT CAPITAL ACCOUNT LIMITATION: has the meaning set forth in Section 1.9(b) of Exhibit D
hereto.



“LTIP UNIT CONVERSION DATE” has the meaning set forth in Section 1.9(c) of Exhibit D hereto.



“LTIP UNIT CONVERSION NOTICE” has the meaning set forth in Section 1.9(c) of Exhibit D hereto.



“LTIP UNIT CONVERSION RIGHT” has the meaning set forth in Section 1.9(a) of Exhibit D hereto.



“LTIP UNIT DISTRIBUTION PAYMENT DATE” has the meaning set forth in Section 1.5(a) of Exhibit D
hereto.



“LTIP UNIT FORCED CONVERSION” has the meaning set forth in Section 1.10 of Exhibit D hereto.



“LTIP UNIT FORCED CONVERSION NOTICE” has the meaning set forth in Section 1.10 of Exhibit D hereto.



“LTIP UNIT LIMITED PARTNER” means any Person holding LTIP Units, and named as a LTIP Unit Limited
Partner in Exhibit A attached hereto, as such Exhibit may be amended from time to time.



“LIMITED PARTNER” means any Person named as a Limited Partner on Exhibit A attached hereto as such
Exhibit may be amended from time to time, including any Person who becomes a Substituted Limited
Partner, an Additional Limited Partner or a LTIP Unit Limited Partner in accordance with the terms
of this Agreement, in each case, in such Person’s capacity as a limited partner of the Partnership.



“LIMITED PARTNERSHIP INTEREST” means the ownership interest of a Limited Partner in the Partnership
at any particular time, including the right of such Limited Partner to any and all benefits to
which such Limited Partner may be entitled as provided in this Agreement and in the Act, together
with the obligations of such Limited Partner to comply with all the provisions of this Agreement
and of such Act.



“LIQUIDATING GAINS” means any net gain realized in connection with the actual or hypothetical sale
of all or substantially all of the assets of the Partnership (including upon the occurrence of any
event of liquidation of the Partnership), including but not limited to net gain realized in
connection with an adjustment to the Book Value of Partnership assets under Section 4.04 of this
Agreement.



5









 




“LIQUIDATING LOSSES” means any net loss realized in connection with the actual or hypothetical sale
of all or substantially all of the assets of the Partnership (including upon the occurrence of any
event of liquidation of the Partnership), including but not limited to net loss realized in
connection with an adjustment to the Book Value of Partnership assets under Section 4.04 of this
Agreement.



“LOSS” has the meaning provided in Section 5.01(g) hereof.



“MEASUREMENT DATE” means the end of the “measurement period” as specified in the documentation
pursuant to which a Special LTIP Unit is granted.



“NOTICE OF REDEMPTION” means the Notice of Exercise of Redemption Right substantially in the form
attached as Exhibit B hereto.



“NYSE” means the New York Stock Exchange.



“OFFER” has the meaning set forth in Section 7.01(c) hereof.



“PARTNER” means any General Partner, Limited Partner (including any LTIP Unit Limited Partner).
Such term shall be deemed to include such other Persons who become Partners pursuant to the terms
of this Agreement.



“PARTNER MINIMUM GAIN” The gain (regardless of character) that would be recognized by the
Partnership if property of the Partnership subject to a partner nonrecourse debt (as such term is
defined in Treasury Regulations Section 1.704-2(b)(4)) were disposed of in full satisfaction of
such debt on the relevant date. The adjusted basis of property subject to more than one partner
nonrecourse debt shall be allocated in a manner consistent with the allocation of basis for
purposes of determining Partnership Minimum Gain hereunder. Partner Minimum Gain shall be computed
hereunder using the Book Value, rather than the adjusted tax basis, of the Partnership property in
accordance with Treasury Regulations Section 1.704-2(d)(3).



“PARTNER NONRECOURSE DEBT MINIMUM GAIN” has the meaning set forth in Regulations Section
1.704-2(i). A Partner’s share of Partner Nonrecourse Debt Minimum Gain shall be determined in
accordance with Regulations Section 1.704-2(i)(5).



“PARTNERSHIP INTEREST” means an ownership interest in the Partnership held by either a Limited
Partner or the General Partner and includes any and all benefits to which the holder of such a
Partnership Interest may be entitled as provided in this Agreement, together with all obligations
of such Person to comply with the terms and provisions of this Agreement.



“PARTNERSHIP MINIMUM GAIN” has the meaning set forth in Regulations Section 1.704-2(d). In
accordance with Regulations Section 1.704-2(d), the amount of Partnership Minimum Gain is
determined by first computing, for each Partnership nonrecourse liability, any gain the Partnership
would realize if it disposed of the property subject to that liability for no consideration other
than full satisfaction of the liability, and then aggregating the separately computed gains. A
Partner’s share of Partnership Minimum Gain shall be determined in accordance with Regulations
Section 1.704-2(g)(1).



“PARTNERSHIP RECORD DATE” means the record date established by the General Partner for the
distribution of cash pursuant to Section 5.02 hereof, which record date shall be the same as the
record date established by the Company for a distribution to its stockholders of some or all of its
portion of such distribution received through the General Partner.




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“PARTNERSHIP UNIT” means a Common Unit or an LTIP Unit and shall constitute a fractional,
undivided share of the Partnership Interests of all Partners issued hereunder. The allocation of
Partnership Units among the Partners shall be as set forth on Exhibit A, as may be amended from
time to time.



“PERCENTAGE INTEREST” means, with respect to any Partner, the percentage ownership interest of such
Partner in the Partnership from time to time, represented by a fraction (expressed as a
percentage), the numerator of which is the number of Partnership Units then owned by such Partner,
and the denominator of which is the total number of Partnership Units then owned by all of the
Partners. For purposes of calculations of Percentage Interests at any time, the Percentage
Interest of any LTIP Unit Limited Partner and the total number of Partnership Units shall exclude
any LTIP Units for which the LTIP Unit Distribution Participation Date has not occurred as of such
time.



“PERSON” means any individual, partnership, corporation, limited liability company, joint venture,
trust or other entity.



“PROFIT” has the meaning provided in Section 5.01(g) hereof.



“PROPERTY” means any property or other investment in which the Partnership holds an ownership
interest.



“REDEMPTION AMOUNT” means either the Cash Amount or the REIT Shares Amount, as selected by the
Partnership or as directed by the General Partner pursuant to Section 8.04(b) hereof.



“REDEMPTION RIGHT” has the meaning provided in Section 8.04(a) hereof.



“REDEEMING LIMITED PARTNER” has the meaning provided in Section 8.04(a) hereof.



“REGULATIONS” means the Federal Income Tax Regulations issued under the Code, as amended and as
hereafter amended from time to time. Reference to any particular provision of the Regulations shall
mean that provision of the Regulations on the date hereof and any successor provision of the
Regulations.



“REIT” means a real estate investment trust under Sections 856 through 860 of the Code.



“REIT EXPENSES” means (i) costs and expenses relating to the formation and continuity of existence
and operation of the Company and any Subsidiaries thereof (which Subsidiaries shall, for purposes
hereof, be included within the definition of Company), including taxes, fees and assessments
associated therewith, any and all costs, expenses or fees payable to any director, officer or
employee of the Company, (ii) costs and expenses relating to any public offering and registration,
or private offering, of securities by the Company and all statements, reports, fees and expenses
incidental thereto, including, without limitation, underwriting discounts and selling commissions
applicable to any such offering of securities, and any costs and expenses associated with any
claims made by any holders of such securities or any underwriters or placement agents thereof,
(iii) costs and expenses associated with any repurchase of any securities by the Company, (iv)
costs and expenses associated with the preparation and filing of any periodic or other reports and
communications by the Company under federal, state or local laws or regulations, including filings
with the Commission, (v) costs and expenses associated with compliance by the Company with laws,
rules and regulations promulgated by any regulatory body, including the Commission and any
securities exchange, (vi) costs and expenses associated with any 401(k) plan, incentive





7









 







plan, bonus plan or other plan providing for compensation for the employees of the Company, (vii)
costs and expenses incurred by the Company relating to any issuing or redemption of Partnership
Interests and (viii) all other operating or administrative costs of the Company or any subsidiary,
including the General Partner, incurred in the ordinary course of its business on behalf of or in
connection with the Partnership.



“REIT SHARE” means a Common Share of the Company (or Successor Entity, as the case may be).



“REIT SHARES AMOUNT” means a number of REIT Shares equal to the product of the number of
Partnership Units offered for redemption by a Redeeming Limited Partner, multiplied by the
Conversion Factor as adjusted to and including the Specified Redemption Date; provided that in the
event the Company issues to all holders of REIT Shares rights, options, warrants or convertible or
exchangeable securities entitling the stockholders to subscribe for or purchase REIT Shares, or any
other securities or property (collectively, the “rights”), and the rights have not expired at the
Specified Redemption Date, then the REIT Shares Amount shall also include the rights issuable to a
holder of the REIT Shares Amount on the record date fixed for purposes of determining the holders
of REIT Shares entitled to rights.



“SECURITIES ACT” means the Securities Act of 1933, as amended.



“SERVICE” means the Internal Revenue Service.



“SPECIAL LTIP UNIT” means an LTIP Unit issued as a “superior performance equity award” and that
participates in distributions and allocations to a reduced extent until the applicable Measurement
Date for such LTIP Unit, as set forth in the documentation pursuant to which such Special LTIP Unit
is granted.



“SPECIAL LTIP UNIT SHARING PERCENTAGE” means twenty-percent (20%) or such other percentage as set
forth in the documentation pursuant to which such Special LTIP Unit is granted.



“SPECIFIED REDEMPTION DATE” means the first business day of the month that is at least 60 calendar
days after the receipt by the Partnership of a Notice of Redemption.



“SUBSIDIARY” means, with respect to any Person, any corporation, partnership, limited liability
company 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.



“SUBSIDIARY PARTNERSHIP” means any partnership or limited liability company in which the Company, a
Subsidiary of the Company or the Partnership owns a partnership interest.



“SUBSTITUTE LIMITED PARTNER” means any Person admitted to the Partnership as a Limited Partner
pursuant to Section 9.03 hereof.



“SUCCESSOR ENTITY” has the meaning provided in the definition of “Conversion Factor” contained
herein.



“SURVIVING GENERAL PARTNER” has the meaning set forth in Section 7.01(d) hereof.



“TRADING DAY” means a day on which the principal national securities exchange on which a security
is listed or admitted to trading is open for the transaction of business or, if a security is not
listed or admitted to trading on any national securities exchange, shall mean any day other





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than a Saturday, a Sunday or a day on which banking institutions in the State of New York are
authorized or obligated by law or executive order to close.



“TRANSACTION” has the meaning set forth in Section 1.13(a) of Exhibit D hereto.



“TRANSFER” has the meaning set forth in Section 9.02(a) hereof.



“UNVESTED LTIP UNITS” has the meaning set forth in Section 1.2 of Exhibit D hereto.



“VALUE” means, with respect to any security, the average of the daily market price of such security
for the ten consecutive Trading Days immediately preceding the date of such valuation. The market
price for each such Trading Day shall be: (i) if the security is listed or admitted to trading on
the NYSE or any securities exchange, the last reported sale price, regular way, on such day, or if
no such sale takes place on such day, the average of the closing bid and asked prices, regular way,
on such day, (ii) if the security is not listed or admitted to trading on the NYSE or any
securities exchange, the last reported sale price on such day or, if no sale takes place on such
day, the average of the closing bid and asked prices on such day, as reported by a reliable
quotation source designated by the General Partner, or (iii) if the security is not listed or
admitted to trading on the NYSE or on any securities exchange and no such last reported sale price
or closing bid and asked prices are available, the average of the reported high bid and low asked
prices on such day, as reported by a reliable quotation source designated by the General Partner,
or if there shall be no bid and asked prices on such day, the average of the high bid and low asked
prices, as so reported, on the most recent day (not more than ten days prior to the date in
question) for which prices have been so reported; provided that if there are no bid and asked
prices reported during the ten days prior to the date in question, the value of the security shall
be determined by the General Partner acting in good faith on the basis of such quotations and other
information as it considers, in its reasonable judgment, appropriate. In the event the security
includes any additional rights, 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.



“VESTED LTIP UNITS” has the meaning set forth in Section 1.2 of Exhibit D hereto.



“VESTING AGREEMENT” has the meaning set forth in Section 1.2 of Exhibit D hereto.



“WITHHELD AMOUNT” has the meaning set forth in Section 5.02(c) hereof.




9









 








ARTICLE II

FORMATION OF PARTNERSHIP




     2.01 CONTINUATION. The Partners hereby agree to continue the Partnership pursuant to
the Act and upon the terms and conditions set forth in this Agreement.



     2.02 NAME, OFFICE AND REGISTERED AGENT. The name of the Partnership is MPT Operating
Partnership, L.P. The specified office and place of business of the Partnership shall be 1000 Urban
Center Drive, Suite 501, Birmingham, Alabama 35242. The General Partner may at any time change the
location of such office, provided the General Partner gives notice to the Partners of any such
change. The name of the Partnership’s registered agent is National Registered Agents, Inc. whose
business address is 9 East Loocheman Street, Suite 1B, Dover, Delaware 19901. The sole duty of the
registered agent as such is to forward to the Partnership any notice that is served on it as
registered agent.



     2.03 PARTNERS.




     (a) The General Partner of the Partnership is Medical Properties Trust, LLC,
a Delaware limited liability company. Its principal place of business is the same as that
of the Partnership.




     (b) The Limited Partners are those Persons identified as Limited Partners on
Exhibit A hereto, as amended from time to time.



     2.04 TERM AND DISSOLUTION.




     (a) The Partnership’s existence shall be perpetual, except that the
Partnership shall be dissolved upon the first to occur of any of the following events:




     (i) The occurrence of an Event of Bankruptcy as to the General Partner or
the dissolution, death, removal or withdrawal of the General Partner unless the
business of the Partnership is continued pursuant to Section 7.03(b) hereof;
provided that if the General Partner is on the date of such occurrence a
partnership, the dissolution of the General Partner as a result of the
dissolution, death, withdrawal, removal or Event of Bankruptcy of a partner in
such partnership shall not be an event of dissolution of the Partnership if the
business of the General Partner is continued by the remaining partner or
partners, either alone or with additional partners, and the General Partner and
such partners comply with any other applicable requirements of this Agreement;




     (ii) The passage of 90 days after the sale or other disposition of all or
substantially all of the assets of the Partnership (provided that if the
Partnership receives an installment obligation as consideration for such sale or
other disposition, the Partnership shall continue, unless sooner dissolved under
the provisions of this Agreement, until such time as such note or notes are paid
in full); or




     (iii) The election by the General Partner that the Partnership should be
dissolved.



10









 






     (b) Upon dissolution of the Partnership (unless the business of the
Partnership is continued pursuant to Section 7.03(b) hereof), the General Partner (or its
trustee, receiver, successor or legal representative) shall amend or cancel the Certificate
and liquidate the Partnership’s assets and apply and distribute the proceeds thereof in
accordance with Section 5.06 hereof. Notwithstanding the foregoing, the liquidating General
Partner may either (i) defer liquidation of, or withhold from distribution for a reasonable
time, any assets of the Partnership (including those necessary to satisfy the Partnership’s
debts and obligations), or (ii) distribute the assets to the Partners in kind.



     2.05 FILING OF CERTIFICATE AND PERFECTION OF LIMITED PARTNERSHIP. The General
Partner shall execute, acknowledge, record and file at the expense of the Partnership the
Certificate and any and all amendments thereto and all requisite fictitious name statements and
notices in such places and jurisdictions as may be necessary to cause the Partnership to be treated
as a limited partnership under, and otherwise to comply with, the laws of each state or other
jurisdiction in which the Partnership conducts business.



     2.06 CERTIFICATES DESCRIBING PARTNERSHIP UNITS. At the request of a Limited Partner,
the General Partner, at its option, may issue a certificate summarizing the terms of such Limited
Partner’s interest in the Partnership, including the number of Partnership Units owned and the
Percentage Interest represented by such Partnership Units as of the date of such certificate. Any
such certificate (i) shall be in form and substance as approved by the General Partner, (ii) shall
not be negotiable and (iii) shall bear a legend to the following effect:


This certificate is not negotiable. The Partnership Units represented by this certificate are
governed by and transferable only in accordance with the provisions of the Agreement of Limited
Partnership of MPT Operating Partnership, L.P., as amended from time to time.




ARTICLE III

BUSINESS OF THE PARTNERSHIP



The purpose and nature of the business to be conducted by the Partnership is (i) to conduct any
business that may be lawfully conducted by a limited partnership organized pursuant to the Act,
provided, however, that such business shall be limited to and conducted in such a manner as to
permit the Company at all times to qualify as a REIT, unless the Company otherwise ceases to
qualify as a REIT, (ii) to enter into any partnership, joint venture or other similar arrangement
to engage in any of the foregoing or the ownership of interests in any entity engaged in any of the
foregoing and (iii) to do anything necessary or incidental to the foregoing. In connection with the
foregoing, and without limiting the Company’s right in its sole and absolute discretion to cease
qualifying as a REIT, the Partners acknowledge that the Company’s current status as a REIT and the
avoidance of income and excise taxes on the Company inures to the benefit of all the Partners and
not solely to the Company. Notwithstanding the foregoing, the Limited Partners agree that the
Company may terminate its status as a REIT under the Code at any time. The General Partner shall
also be empowered to do any and all acts and things necessary or prudent to ensure that the
Partnership will not be classified as a “publicly traded partnership” taxable as a corporation for
purposes of Section 7704 of the Code.




11









 








ARTICLE IV

CAPITAL CONTRIBUTIONS AND ACCOUNTS




     4.01 CAPITAL CONTRIBUTIONS. The General Partner and the Limited Partners have made
capital contributions to the Partnership in exchange for the Partnership Interests set forth
opposite their names on Exhibit A, as amended from time to time.



     4.02 ADDITIONAL CAPITAL CONTRIBUTIONS AND ISSUANCES OF ADDITIONAL PARTNERSHIP
INTERESTS. Except as provided in this Section 4.02 or in Section 4.03, the Partners shall have no
right or obligation to make any additional Capital Contributions or loans to the Partnership. The
General Partner and/or the Company may contribute additional capital to the Partnership, from time
to time, and receive additional Partnership Interests in respect thereof, in the manner
contemplated in this Section 4.02.




     (a) Issuances of Additional Partnership Interests.




     (i) General. The General Partner is hereby authorized to cause the
Partnership to issue such 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 Company) or to other Persons
for such consideration and on such terms and conditions as shall be established
by the General Partner in its sole and absolute discretion, all without the
approval of any Limited Partners. The General Partner’s determination that
consideration is adequate shall be conclusive insofar as the adequacy of
consideration relates to whether the Partnership Interests are validly issued and
fully paid. Any additional Partnership Interests issued thereby may be issued in
one or more classes, or one or more series of any of such classes, with such
designations, preferences and relative, participating, optional or other special
rights, powers and duties, including rights, powers and duties senior to Limited
Partnership Interests, all as shall be determined by the General Partner in its
sole and absolute discretion and without the approval of any Limited Partner,
subject to Delaware law, including, without limitation, (i) the allocations of
items of Partnership income, gain, loss, deduction and credit to each such class
or series of Partnership Interests; (ii) the right of each such class or series
of Partnership Interests to share in Partnership distributions; and (iii) the
rights of each such class or series of Partnership Interests upon dissolution and
liquidation of the Partnership; provided, however, that no additional Partnership
Interests shall be issued to the General Partner or the Company (or any direct or
indirect wholly-owned Subsidiary of the General Partner or the Company) unless:




     (1) (A) the additional Partnership Interests are issued in connection
with an issuance of REIT Shares of the Company or other interests in the
Company, which shares or interests have designations, preferences and
other rights, all such that the economic interests are substantially
similar to the designations, preferences and other rights of the
additional Partnership Interests issued to the General Partner or the
Company (or any direct or indirect wholly-owned Subsidiary of the General
Partner or the Company) by the Partnership in accordance with this Section
4.02 and (B) the General Partner or the Company (or any



12









 






direct or indirect wholly-owned Subsidiary of the General Partner or
the Company) shall make a Capital Contribution to the Partnership in an
amount equal to the cash consideration received by the General Partner or
the Company from the issuance of such shares of stock of or other
interests in the General Partner or the Company;




     (2) the additional Partnership Interests are issued in exchange for
property owned by the General Partner or the Company (or any direct or
indirect wholly-owned Subsidiary of the General Partner or the Company)
with a fair market value, as determined by the General Partner, in good
faith, equal to the value of the Partnership Interests; or




     (3) the additional Partnership Interests are issued to all Partners
in proportion to their respective Percentage Interests.


Without limiting the foregoing, the General Partner is expressly authorized (other than in the case
of an issuance under clause 2 above) to cause the Partnership to issue Partnership Units for less
than fair market value, so long as the General Partner concludes in good faith that such issuance
is in the best interests of the General Partner and the Partnership.





     (ii) Upon Issuance of Additional Securities. The Company shall not issue any
additional REIT Shares (other than REIT Shares issued in connection with an
exchange pursuant to Section 8.04 hereof) or rights, options, warrants or
convertible or exchangeable securities containing the right to subscribe for or
purchase REIT Shares (collectively, “Additional Securities”) other than to all
holders of REIT Shares, unless (A) the General Partner shall cause the
Partnership to issue to the Company or the General Partner Partnership Interests
or rights, options, warrants or convertible or exchangeable securities of the
Partnership having designations, preferences and other rights, all such that the
economic interests are substantially similar to those of the Additional
Securities, and (B) the Company contributes the proceeds from the issuance of
such Additional Securities and from any exercise of rights contained in such
Additional Securities to the Partnership; provided, however, that the Company is
allowed to issue Additional Securities in connection with an acquisition of a
property to be held directly by the Company, but if and only if, such direct
acquisition and issuance of Additional Securities have been approved and
determined to be in the best interests of the Company and the Partnership by a
majority of the Board of Directors. Without limiting the foregoing, the Company
is expressly authorized to issue Additional Securities for less than fair market
value, and to cause the Partnership to issue to the Company or the General
Partner corresponding Partnership Interests, so long as (x) the General Partner
concludes in good faith that such issuance is in the best interests of the
General Partner and the Partnership and (y) the Company contributes all proceeds
from such issuance to the Partnership, including without limitation, the issuance
of REIT Shares and corresponding Partnership Units pursuant to a share purchase
plan providing for purchases of REIT Shares at a discount from fair market value
or employee stock options that have an exercise price that is less than the fair
market value of the REIT Shares, either at the time of issuance or at the time of
exercise, or restricted or other stock awards. For example, in the event the
Company issues REIT Shares for a cash purchase price and the Company contributes
all of the proceeds of such issuance to the Partnership as required hereunder,
the Company shall be issued a number of



13









 






additional Partnership Units equal to the product of (A) the number of such
REIT Shares issued by the Company, the proceeds of which were so contributed,
multiplied by (B) a fraction, the numerator of which is 100%, and the denominator
of which is the Conversion Factor in effect on the date of such contribution.




     (iii) Notwithstanding anything to the contrary, from and after the date
hereof the Partnership shall be authorized to issue LTIP Units. From time to
time the General Partner may issue LTIP Units to Persons providing services to or
for the benefit of the Partnership.




     (b) Certain Contributions of Proceeds of Issuance of REIT Shares. In
connection with any and all issuances of REIT Shares, the Company or the General Partner
shall make Capital Contributions to the Partnership of the proceeds therefrom, provided
that if the proceeds actually received and contributed by the Company are less than the
gross proceeds of such issuance as a result of any underwriter’s discount (or other
expenses paid or incurred in connection with such issuance, which shall be REIT Expenses
hereunder), then the Company or the General Partner shall make a Capital Contribution of
such net proceeds to the Partnership but shall receive additional Partnership Units with a
value equal to the aggregate amount of the gross proceeds of such issuance pursuant to
Section 4.02(a) hereof. Upon any such Capital Contribution by the Company, the Company’s or
the General Partner’s Capital Account shall be increased pursuant to Section 4.04 hereof by
the amount of the gross proceeds of the issuance.




     (c) If the Company shall repurchase shares of any class of the Company’s
capital stock, all costs incurred in connection with such repurchase shall be reimbursed to
the Company by the Partnership pursuant to Section 6.05 hereof and the General Partner
shall cause the Partnership to redeem an equivalent number of Partnership Interests of the
appropriate class held by the Company or the General Partner (which, in the case of Common
Shares, shall be a number equal to the quotient of the number of such Common Shares divided
by the Conversion Factor) in the manner provided in Section 6.10.



     4.03 ADDITIONAL FUNDING. If the General Partner determines that it is in the best
interests of the Partnership to provide for additional Partnership funds (“Additional Funds”) for
any Partnership purpose, the General Partner may (i) cause the Partnership to obtain such funds
from outside borrowings, or (ii) elect to have the General Partner, the Company or any of their
Affiliates provide such Additional Funds to the Partnership through loans or otherwise. Subject to
the provisions of Section 6.05, no person shall have any preemptive, preferential or similar right
or rights to subscribe for or acquire any Partnership Interests except as set forth in this
Article.



     4.04 CAPITAL ACCOUNTS. A separate capital account (a “Capital Account”) shall be
established and maintained for each Partner in accordance with Regulations Section
1.704-1(b)(2)(iv). Consistent with the provisions of Regulations Section 1.704-1(b)(2)(iv)(f), (i)
immediately prior to the acquisition of an additional Partnership Interest by any new or existing
Partner in connection with the contribution of money or other property (other than a de minimis
amount) to the Partnership, (ii) immediately prior to the distribution by the Partnership to a
Partner of Partnership property (other than a de minimis amount) as consideration for a Partnership
Interest, (iii) upon the acquisition of a more than de minimis additional interest in the
Partnership by any new or existing Partner as consideration for the provision of services to or for
the benefit of the Partnership in a partner capacity or in anticipation of becoming a Partner, (iv)
upon the grant of any LTIP Unit, and (v) immediately prior to the liquidation of the Partnership as



14









 




defined in Regulations Section 1.704-1(b)(2)(ii)(g), the Book Value of all Partnership Assets
shall be revalued upward or downward to reflect the fair market value (as determined by the General
Partner, in its sole and absolute discretion, and taking into account Section 7701(g) of the Code)
of each such Partnership asset unless the General Partner shall determine that such revaluation is
not necessary to maintain Capital Accounts in accordance with Regulations Section
1.704-1(b)(2)(iv). When the Partnership’s property is revalued by the General Partner, the Capital
Accounts of the Partners shall be adjusted in accordance with Regulations Sections
1.704-1(b)(2)(iv)(f) and (g), which generally require such Capital Accounts to be adjusted to
reflect the manner in which the unrealized gain or loss inherent in such property (that has not
been reflected in the Capital Accounts previously) would be allocated among the Partners pursuant
to Section 5.01 if there were a taxable disposition of such property for its fair market value (as
determined by the General Partner, in its sole and absolute discretion, and taking into account
Section 7701(g) of the Code) on the date of the revaluation.




     4.05 PERCENTAGE INTERESTS. If the number of outstanding Partnership Units increases
or decreases during a taxable year, each Partner’s Percentage Interest shall be adjusted by the
General Partner effective as of the effective date of each such increase or decrease to a
percentage equal to the number of Partnership Units held by such Partner divided by the aggregate
number of Partnership Units outstanding after giving effect to such increase or decrease. If the
Partners’ Percentage Interests are adjusted pursuant to this Section 4.05, the Profits and Losses
for the taxable year in which the adjustment occurs shall be allocated between the part of the year
ending on the day when the Partnership’s property is revalued by the General Partner and the part
of the year beginning on the following day either (i) as if the taxable year had ended on the date
of the adjustment or (ii) based on the number of days in each part. The General Partner, in its
sole and absolute discretion, shall determine which method shall be used to allocate Profits and
Losses for the taxable year in which the adjustment occurs. The allocation of Profits and Losses
for the earlier part of the year shall be based on the Percentage Interests before adjustment, and
the allocation of Profits and Losses for the later part shall be based on the adjusted Percentage
Interests. For purposes of the calculation of Percentage Interests pursuant to this Section 4.5,
the Percentage Interest of any LTIP Units for which the LTIP Unit Distribution Participation Date
has not occurred as of the relevant time shall be 0%.



     4.06 NO INTEREST ON CONTRIBUTIONS. No Partner shall be entitled to interest on its
Capital Contribution.



     4.07 RETURN OF CAPITAL CONTRIBUTIONS. No Partner shall be entitled to withdraw any
part of its Capital Contribution or its Capital Account or to receive any distribution from the
Partnership, except as specifically provided in this Agreement. Except as otherwise provided
herein, there shall be no obligation to return to any Partner or withdrawn Partner any part of such
Partner’s Capital Contribution for so long as the Partnership continues in existence.



     4.08 NO THIRD PARTY BENEFICIARY. No creditor or other third party having dealings
with the Partnership shall have the right to enforce the right or obligation of any Partner to make
Capital Contributions or loans or to pursue any other right or remedy hereunder or at law or in
equity, it being understood and agreed that the provisions of this Agreement shall be solely for
the benefit of, and may be enforced solely by, the parties hereto and their respective successors
and assigns. 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 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 of any of the Partners. In addition, it is the
intent



15









 




of the parties hereto that no distribution to any Limited Partner shall be deemed a return of
money or other property in violation of the Act. However, if any court of competent jurisdiction
holds that, notwithstanding the provisions of this Agreement, any Limited Partner is obligated to
return such money or property, such obligation shall be the obligation of such Limited Partner and
not of the General Partner. Without limiting the generality of the foregoing, a deficit Capital
Account of a Partner shall not be deemed to be a liability of such Partner nor an asset or property
of the Partnership.




ARTICLE V

PROFITS AND LOSSES; DISTRIBUTIONS




     5.01 ALLOCATION OF PROFIT AND LOSS.




     (a) Profit. After giving effect to the special allocations, if any,
provided in Section 5.01(c) and (d), Profits in each fiscal year or other period shall be
allocated in the following order of priority:




     (i) First to the General Partner until the cumulative Profits allocated to
the General Partner under this Section 5.01(a) equal the cumulative Losses
allocated to such Partner under Section 5.01(b)(ii);




     (ii) Second, to each holder of Common Units in proportion to the cumulative
Losses allocated to such holder under Section 5.01(b)(i), until the cumulative
Profits allocated to such holder under this Section 5.01(a)(ii) equals the
cumulative Losses allocated to such holder under Section 5.01(b)(i); and




     (iii) Thereafter, to the holders of Common Units in accordance with their
respective Percentage Interests.


For purposes of determining allocations of Profits pursuant to Section 5.01(a), if the LTIP Unit
Distribution Participation Date with respect to an LTIP Unit has occurred, such LTIP Unit shall be
treated as a Common Unit; provided, however, that with respect to an issued and outstanding Special
LTIP Unit, until the applicable Measurement Date, amounts shall only be allocated with respect to
such Special LTIP Unit in an amount equal to the product of the Special LTIP Unit Sharing
Percentage and the amount otherwise allocable with respect to such Special LTIP Unit.





     (b) Losses. After giving effect to the special allocations, if any,
provided in Section 5.01(c) and (d), Loss in each fiscal year or other period shall be
allocated in the following order of priority:




     (i) First, to the holders of Common Units pro rata in accordance with
positive adjusted Capital Account balances until their adjusted Capital Accounts
are reduced to zero; and




     (ii) Thereafter, to the General Partner.


For purposes of determining allocations of Losses pursuant to Section 5.01(b), to the extent that
the LTIP Unit Distribution Participation Date with respect to an LTIP Unit has occurred, such LTIP
Unit shall be treated as a Common Unit.




16









 









     (c) Minimum Gain Chargeback. Notwithstanding any provision to the contrary,
(i) any expense of the Partnership that is a “nonrecourse deduction” within the meaning of
Regulations Section 1.704-2(b)(1) shall be allocated in accordance with the Partners’
respective Percentage Interests, (ii) any expense of the Partnership that is a “partner
nonrecourse deduction” within the meaning of Regulations Section 1.704-2(i)(2) shall be
allocated to the Partner that bears the “economic risk of loss” of such deduction in
accordance with Regulations Section 1.704-2(i)(1), (iii) if there is a net decrease in
Partnership Minimum Gain within the meaning of Regulations Section 1.704-2(f)(1) for any
Partnership taxable year, then, subject to the exceptions set forth in Regulations Section
1.704-2(f)(2),(3), (4) and (5), items of gain and income shall be allocated among the
Partners in accordance with Regulations Section 1.704-2(f) and the ordering rules contained
in Regulations Section 1.704-2(j), and (iv) if there is a net decrease in Partner
Nonrecourse Debt Minimum Gain within the meaning of Regulations Section 1.704-2(i)(4) for
any Partnership taxable year, then, subject to the exceptions set forth in Regulations
Section 1.704(2)(g), items of gain and income shall be allocated among the Partners in
accordance with Regulations Section 1.704-2(i)(4) and the ordering rules contained in
Regulations Section 1.704-2(j). A Partner’s “interest in partnership profits” for purposes
of determining its share of the nonrecourse liabilities of the Partnership within the
meaning of Regulations Section 1.752-3(a)(3) shall be such Partner’s Percentage Interest.




     (d) Qualified Income Offset. If a Partner receives in any taxable year an
adjustment, allocation or distribution described in subparagraphs (4), (5) or (6) of
Regulations Section 1.704-1(b)(2)(ii)(d) that causes or increases a deficit balance in such
Partner’s Capital Account that exceeds the sum of such Partner’s shares of Partnership
Minimum Gain and Partner Nonrecourse Debt Minimum Gain, as determined in accordance with
Regulations Sections 1.704-2(g) and 1.704-2(i), such Partner shall be allocated specially
for such taxable year (and, if necessary, later taxable years) items of income and gain in
an amount and manner sufficient to eliminate such deficit Capital Account balance as
quickly as possible as provided in Regulations Section 1.704-1(b)(2)(ii)(d). After the
occurrence of an allocation of income or gain to a Partner in accordance with this Section
5.01(d), to the extent permitted by Regulations Section 1.704-1(b), items of expense or
loss shall be allocated to such Partner in an amount necessary to offset the income or gain
previously allocated to such Partner under this Section 5.01(d).




     (e) Capital Account Deficits. Loss shall not be allocated to a Limited
Partner to the extent that such allocation would cause a deficit in such Partner’s Capital
Account (after reduction to reflect the items described in Regulations Section
1.704-1(b)(2)(ii)(d)(4), (5) and (6)) to exceed the sum of such Partner’s shares of
Partnership Minimum Gain and Partner Nonrecourse Debt Minimum Gain. Any Loss in excess of
that limitation shall be allocated to the General Partner. After the occurrence of an
allocation of Loss to the General Partner in accordance with this Section 5.01(e), to the
extent permitted by Regulations Section 1.704-1(b), Profit shall be allocated to such
Partner in an amount necessary to offset the Loss previously allocated to each Partner
under this Section 5.01(e).




     (f) Allocations Between Transferor and Transferee. If a Partner transfers
any part or all of its Partnership Interest, the distributive shares of the various items
of Profit and Loss allocable among the Partners during such fiscal year of the Partnership
shall be allocated between the transferor and the transferee Partner either (i) as if the
Partnership’s



17









 






fiscal year had ended on the date of the transfer, or (ii) based on the number of days
of such fiscal year that each was a Partner without regard to the results of Partnership
activities in the respective portions of such fiscal year in which the transferor and the
transferee were Partners. The General Partner, in its sole and absolute discretion, shall
determine which method shall be used to allocate the distributive shares of the various
items of Profit and Loss between the transferor and the transferee Partner.




(g) Definition of Profit and Loss. “Profit” and “Loss” and any items of
income, gain, expense or loss referred to in this Agreement shall be determined in
accordance with federal income tax accounting principles, as modified by Regulations
Section 1.704-1(b)(2)(iv), except that Profit and Loss shall not include items of income,
gain and expense that are specially allocated pursuant to Sections 5.01(c), 5.01(d) or
5.01(e). All allocations of income, Profit, gain, Loss and expense (and all items contained
therein) for federal income tax purposes shall be identical to all allocations of such
items set forth in this Section 5.01, except as otherwise required by Section 704(c) of the
Code and Regulations Section 1.704-1(b)(4). The Partnership shall use the traditional
method for allocating items of income, gain and expense as required by Section 704(c) of
the Code with respect to the properties acquired by the Partnership in connection with the
private placement of the Company’s securities. With respect to other properties acquired by
the Partnership, the General Partner shall have the authority to elect the method to be
used by the Partnership for allocating items of income, gain and expense as required by
Section 704(c) of the Code with respect to such properties, and such election shall be
binding on all Partners.




(h) To the extent provided for in Regulations, revenue rulings, revenue
procedures and/or other IRS guidance issued after the date hereof, the Partnership is
hereby authorized to, and at the direction of the General Partner shall, elect a safe
harbor under which the fair market value of any Partnership Interests issued after the
effective date of such Regulations (or other guidance) will be treated as equal to the
liquidation value of such Partnership Interests (i.e., a value equal to the total amount
that would be distributed with respect to such interests if the Partnership sold all of its
assets for their fair market value immediately after the issuance of such Partnership
Interests, satisfied its liabilities (excluding any non-recourse liabilities to the extent
the balance of such liabilities exceed the fair market value of the assets that secure
them) and distributed the net proceeds to the Partners under the terms of this Agreement).
In the event that the Partnership makes a safe harbor election as described in the
preceding sentence, each Partner hereby agrees to comply with all safe harbor requirements
with respect to transfers of such Partnership Interests while the safe harbor election
remains effective.




(i) Upon a forfeiture of any unvested Partnership Interest by any Partner,
gross items of income, gain, loss or deduction shall be allocated to such Partner if and to
the extent required by final Regulations promulgated after the effective date of this
Agreement to ensure that allocations made with respect to all unvested Partnership
Interests are recognized under Code Section 704(b).




(j) After giving effect to the special allocations set forth in Sections
5.01(c) and (d) hereof, and the allocations of Profit and Loss under Sections 5.01(a) and
(b) (including, for the avoidance of doubt Liquidating Gains that are a component of
Profit):




     (i) any remaining Liquidating Gains shall first be allocated to the LTIP
Unit Limited Partners until the Economic Capital Account Balances of



18









 






     such Partners, to the extent attributable to their ownership of LTIP Units,
are equal to (i) the Common Unit Economic Balance, multiplied by (ii) the number
of their LTIP Units; provided, however, (A) with respect to an
issued and outstanding Special LTIP Unit, until the applicable Measurement Date,
amounts shall only be allocated in an amount equal to the product of the Special
LTIP Unit Sharing Percentage and the amount otherwise allocable with respect to
such Special LTIP Unit and (B) no such Liquidating Gains will be allocated with
respect to any particular LTIP Unit (each an “Ineligible Unit”) unless, and such
allocations, if any, shall be made only to the extent that, such Liquidating
Gains, when aggregated with other Liquidating Gains realized by holders of LTIP
Units since the issuance of such LTIP Unit, exceed Liquidating Losses realized
since the issuance of such LTIP Unit. If, notwithstanding the foregoing, not all
LTIP Units (including Ineligible Units) are fully “booked up”, with respect to
amounts allocated to a particular LTIP Unit Limited Partner, such Partner may
determine how Liquidating Gains shall be allocated among such holder’s LTIP
Units; provided, however, if such holder does not make such a determination,
Liquidating Gains shall generally be allocated so that the Economic Capital
Account Balance of the maximum amount of Vested LTIP Units held by such holder is
equal to the Common Unit Economic Balance on a per Unit basis; provided, further,
that such Liquidating Gains may only be allocated to LTIP Units that are held by
such holder on the date of the allocation under this Section 5.01(j). Any such
allocations shall be made among the holders of LTIP Units in proportion to the
amounts required to be allocated to each under this 

Section 5.01(j)




     (ii) if, due to distributions with respect to Common Units in which the LTIP
Units do not participate or otherwise, the Economic Capital Account Balance of
any present or former holder of LTIP Units, to the extent attributable to the
holder’s ownership of LTIP Units, exceeds the target balance specified above,
then Liquidating Losses shall be allocated to such holder to the extent necessary
to reduce or eliminate the disparity.


The parties agree that the intent of this Section 5.01(j) is to make the Capital Account balance
associated with each LTIP Unit economically equivalent to the Capital Account balance associated
with the General Partner’s Common Units (on a per-unit basis), but only if the Partnership has
sufficient cumulative net Liquidating Gains with respect to its assets since the issuance of the
relevant LTIP Unit.





     (k) If, in connection with any forfeiture of LTIP Units, the balance of the
portion of the Capital Account of the LTIP Unit Limited Partner that is attributable to all
of his or her LTIP Units exceeds the target balance described in Section 5.01(j) above,
such portion of such Partner’s Capital Account shall be reduced to such target balance.
Otherwise, the Capital Account of the LTIP Unit Limited Partner that is attributable to the
forfeited LTIP Units shall be reallocated in a manner reasonably determined by the General
Partner.



     5.02 DISTRIBUTION OF CASH.




     (a) Subject to Section 5.02(c) hereof, the Partnership shall distribute cash
at such times and in such amounts as are determined by the General Partner in its sole and
absolute discretion, to the Partners who are Partners on the Partnership Record Date with



19









 






respect to such quarter (or other distribution period) in accordance with their
respective Percentage Interests on the Partnership Record Date. For purposes of the
foregoing calculations of Section 5.02(a), issued and outstanding LTIP Units with an
associated LTIP Unit Distribution Participation Date that falls on or before the
Partnership Record Date for a particular distribution shall be treated as outstanding
Common Units; provided, however, that with respect to an issued and outstanding Special
LTIP Unit, until the applicable Measurement Date, amounts shall only be distributed with
respect to such Special LTIP Unit in an amount equal to the product of the Special LTIP
Unit Sharing Percentage and the amount otherwise distributable with respect to such Special
LTIP Unit. LTIP Units for which the LTIP Unit Distribution Participation Date has not
occurred as of the Partnership Record Date for a particular distribution shall not be
entitled to any of such distribution.




     (b) If a new or existing Partner acquires an additional Partnership Interest
in exchange for a Capital Contribution on any date other than a Partnership Record Date,
the cash distribution attributable to such additional Partnership Interest relating to the
Partnership Record Date next following the issuance of such additional Partnership Interest
shall be reduced in the proportion to (i) the number of days that such additional
Partnership Interest is held by such Partner bears to (ii) the number of days between such
Partnership Record Date and the immediately preceding Partnership Record Date.




     (c) Notwithstanding any other provision of this Agreement, the General
Partner is authorized to take any action that it determines to be necessary or appropriate
to cause the Partnership to comply with any withholding requirements established under the
Code or any other federal, state or local law including, without limitation, pursuant to
Sections 1441, 1442, 1445 and 1446 of the Code. To the extent that the Partnership is
required to withhold and pay over to any taxing authority any amount resulting from the
allocation or distribution of income to a Partner or assignee (including by reason of
Section 1446 of the Code), either (i) if the actual amount to be distributed to the Partner
(the “Distributable Amount”) equals or exceeds the amount required to be withheld by the
Partnership (the “Withheld Amount”), the entire Distributable Amount shall be treated as a
distribution of cash to such Partner, or (ii) if the Distributable Amount is less than the
Withheld Amount, the excess of the Withheld Amount over the Distributable Amount shall be
treated as a loan (a “Partnership Loan”) from the Partnership to the Partner on the day the
Partnership pays over such amount to a taxing authority. A Partnership Loan shall be repaid
upon the demand of the Partnership or, alternatively, through withholding by the
Partnership with respect to subsequent distributions to the applicable Partner or assignee.
In the event that a Limited Partner (a “Defaulting Limited Partner”) fails to pay any
amount owed to the Partnership with respect to the Partnership Loan within 15 days after
demand for payment thereof is made by the Partnership on the Limited Partner, the General
Partner, in its sole and absolute discretion, may elect to make the payment to the
Partnership on behalf of such Defaulting Limited Partner. In such event, on the date of
payment, the General Partner shall be deemed to have extended a loan (a “General Partner
Loan”) to the Defaulting Limited Partner in the amount of the payment made by the General
Partner and shall succeed to all rights and remedies of the Partnership against the
Defaulting Limited Partner as to that amount. Without limitation, the General Partner shall
have the right to receive any distributions that otherwise would be made by the Partnership
to the Defaulting Limited Partner until such time as the General Partner Loan has been paid
in full, and any such distributions so received by the General Partner shall be treated as
having been received by the Defaulting Limited Partner and immediately paid to the General
Partner.



20









 




Any amounts treated as a Partnership Loan or a General Partner Loan pursuant to this Section
5.02(c) shall bear interest at the lesser of (i) 300 basis points above 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, or (ii) the maximum lawful rate of interest on such obligation, such interest
to accrue from the date the Partnership or the General Partner, as applicable, is deemed to extend
the loan until such loan is repaid in full.





     (d) In no event may a Partner receive a distribution of cash with respect to
a Partnership Unit if such Partner is entitled to receive a cash dividend as the holder of
record of a REIT Share for which all or part of such Partnership Unit has been or will be
redeemed.




     (e) In making distributions pursuant to Section 5.02(a) of the Agreement and
allocations pursuant to Section 5.01 of the Agreement, the General Partner of the
Partnership shall take into account the provisions of Exhibit D hereto.



     5.03 REIT DISTRIBUTION REQUIREMENTS. The General Partner shall use its reasonable
efforts to cause the Partnership to distribute amounts sufficient to enable the Company to pay
stockholder dividends that will allow the Company to (i) meet its distribution requirement for
qualification as a REIT as set forth in Section 857 of the Code and (ii) avoid any federal income
or excise tax liability imposed by the Code, other than to the extent the Company elects to retain
and pay income tax on its net capital gain.



     5.04 NO RIGHT TO DISTRIBUTIONS IN KIND. No Partner shall be entitled to demand
property other than cash in connection with any distributions by the Partnership.



     5.05 LIMITATIONS ON RETURN OF CAPITAL CONTRIBUTIONS. Notwithstanding any of the
provisions of this Article V, no Partner shall have the right to receive, and the General Partner
shall not have the right to make, a distribution that includes a return of all or part of a
Partner’s Capital Contributions, unless after giving effect to the return of a Capital
Contribution, the sum of all Partnership liabilities, other than the liabilities to a Partner for
the return of his Capital Contribution, does not exceed the fair market value of the Partnership’s
assets.



     5.06 DISTRIBUTIONS UPON LIQUIDATION.




     (a) Upon liquidation of the Partnership, after payment of, or adequate
provision for, debts and obligations of the Partnership, including any Partner loans, any
remaining assets of the Partnership shall be distributed to all Partners with positive
Capital Accounts in accordance with their respective positive Capital Account balances.




     (b) For purposes of Section 5.06(a), the Capital Account of each Partner
shall be determined after all adjustments made in accordance with Sections 5.01 and 5.02
resulting from Partnership operations and from all sales and dispositions of all or any
part of the Partnership’s assets.




     (c) Any distributions pursuant to this Section 5.06 shall be made by the end
of the Partnership’s taxable year in which the liquidation occurs (or, if later, within 90
days after the date of the liquidation). To the extent deemed advisable by the General
Partner, appropriate arrangements (including the use of a liquidating trust) may be made to
assure that adequate funds are available to pay any contingent debts or obligations.



21









 





     5.07 SUBSTANTIAL ECONOMIC EFFECT. It is the intent of the Partners that the
allocations of Profit and Loss under the Agreement have substantial economic effect (or be
consistent with the Partners’ interests in the Partnership in the case of the allocation of losses
attributable to nonrecourse debt) within the meaning of Section 704(b) of the Code as interpreted
by the Regulations promulgated pursuant thereto. Article V and other relevant provisions of this
Agreement shall be interpreted in a manner consistent with such intent.



ARTICLE VI

RIGHTS, OBLIGATIONS AND

POWERS OF THE GENERAL PARTNER




     6.01 MANAGEMENT OF THE PARTNERSHIP.




     (a) Except as otherwise expressly provided in this Agreement, the General
Partner shall have full, complete and exclusive discretion to manage and control the
business of the Partnership for the purposes herein stated, and shall make all decisions
affecting the business and assets of the Partnership. Subject to the restrictions
specifically contained in this Agreement, the powers of the General Partner shall include,
without limitation, the authority to take the following actions on behalf of the
Partnership:




     (i) to acquire, purchase, own, operate, lease and dispose of any real
property and any other property or assets including, but not limited to, notes
and mortgages that the General Partner determines are necessary or appropriate in
the business of the Partnership;




     (ii) to construct buildings and make other improvements on the properties
owned or leased by the Partnership;




     (iii) to authorize, issue, sell, redeem or otherwise purchase any
Partnership Interests or any securities (including secured and unsecured debt
obligations of the Partnership, debt obligations of the Partnership convertible
into any class or series of Partnership Interests, or options, rights, warrants
or appreciation rights relating to any Partnership Interests) of the Partnership;




     (iv) to borrow or lend money for the Partnership, issue or receive evidences
of indebtedness in connection therewith, refinance, increase the amount of,
modify, amend or change the terms of, or extend the time for the payment of, any
such indebtedness, and secure indebtedness by mortgage, deed of trust, pledge or
other lien on the Partnership’s assets;




     (v) to pay, either directly or by reimbursement, for all operating costs and
general administrative expenses of the Partnership to third parties or to the
General Partner or its Affiliates;




     (vi) to guarantee or become a co-maker of indebtedness of any Subsidiary of
the Company or the Partnership, refinance, increase the amount of, modify, amend
or change the terms of, or extend the time for the payment of, any such guarantee
or indebtedness, and secure such guarantee or indebtedness by mortgage, deed of
trust, pledge or other lien on the Partnership’s assets;



22









 






     (vii) to use assets of the Partnership (including, without limitation, cash
on hand) for any purpose consistent with this Agreement, including, without
limitation, payment, either directly or by reimbursement, of all operating costs
and general and administrative expenses of the General Partner, the Company, the
Partnership or any Subsidiary of any of them as set forth in this Agreement;




     (viii) to lease all or any portion of any of the Partnership’s assets,
whether or not the terms of such leases extend beyond the termination date of the
Partnership and whether or not any portion of the Partnership’s assets so leased
are to be occupied by the lessee, or, in turn, subleased in whole or in part to
others, for such consideration and on such terms as the General Partner may
determine;




     (ix) to prosecute, defend, arbitrate or compromise any and all claims or
liabilities in favor of or against the Partnership, on such terms and in such
manner as the General Partner may reasonably determine, and similarly to
prosecute, settle or defend litigation with respect to the Partners, the
Partnership or the Partnership’s assets;




     (x) to file applications, communicate and otherwise deal with any and all
governmental agencies having jurisdiction over, or in any way affecting, the
Partnership’s assets or any other aspect of the Partnership business;




     (xi) to make or revoke any election permitted or required of the Partnership
by any taxing authority;




     (xii) to maintain such insurance coverage for public liability, fire and
casualty, and any and all other insurance for the protection of the Partnership,
for the conservation of Partnership assets, or for any other purpose convenient
or beneficial to the Partnership, in such amounts and such types, as it shall
determine from time to time;




     (xiii) to determine whether or not to apply any insurance proceeds for any
property to the restoration of such property or to distribute the same;




     (xiv) to establish one or more divisions of the Partnership, to hire and
dismiss employees of the Partnership or any division of the Partnership, and to
retain legal counsel, accountants, consultants, real estate brokers and such
other persons as the General Partner may deem necessary or appropriate in
connection with the Partnership business and to pay therefor such reasonable
remuneration as the General Partner may deem reasonable and proper;




     (xv) to retain other services of any kind or nature in connection with the
Partnership business, and to pay therefor such remuneration as the General
Partner may deem reasonable and proper;




     (xvi) to negotiate and conclude agreements on behalf of the Partnership with
respect to any of the rights, powers and authority conferred upon the General
Partner;



23









 






     (xvii) to maintain accurate accounting records and to file promptly all
federal, state and local income tax returns on behalf of the Partnership;




     (xviii) to distribute Partnership cash or other Partnership assets in
accordance with this Agreement;




     (xix) to form or acquire an interest in, and contribute property to, any
further limited or general partnerships, joint ventures or other relationships
that it deems desirable (including, without limitation, the acquisition of
interests in, and the contributions of property to, its Subsidiaries and any
other Person in which it has an equity interest from time to time);




     (xx) to establish Partnership reserves for working capital, capital
expenditures, contingent liabilities or any other valid Partnership purpose;




     (xxi) to merge, consolidate or combine the Partnership with or into another
person;




     (xxii) to do any and all acts and things necessary or prudent to ensure that
the Partnership will not be classified as a “publicly traded partnership” taxable
as a corporation under Section 7704 of the Code; and




     (xxiii) to take such other action, execute, acknowledge, swear to or deliver
such other documents and instruments, and perform any and all other acts that the
General Partner deems necessary or appropriate for the formation, continuation
and conduct of the business and affairs of the Partnership (including, without
limitation, all actions consistent with allowing the Company at all times to
qualify as a REIT unless the Company voluntarily terminates its REIT status) and
to possess and enjoy all of the rights and powers of a general partner as
provided by the Act.


Except as otherwise provided herein, each of the Limited Partners agrees that the General Partner
is authorized to execute, deliver and perform the above mentioned agreements and transactions on
behalf of the Partnership without any further act, approval or vote of the Partners,
notwithstanding any other provision of this Agreement, the Act or any applicable law. The
execution, delivery and performance by the General Partner of the above mentioned agreements and
transactions shall not constitute a breach of any duty under this Agreement or implied in law or
equity.



(b) Except as otherwise provided herein, to the extent the duties of the General Partner require
expenditures of funds to be paid to third parties, the General Partner shall not have any
obligations hereunder except to the extent that Partnership funds are reasonably available to it
for the performance of such duties, and nothing herein contained shall be deemed to authorize or
require the General Partner, in its capacity as such, to expend its individual funds for payment to
third parties or to undertake any individual liability or obligation on behalf of the Partnership,
and neither the General Partner nor any Limited Partner shall have any obligation to contribute to
the capital of the Partnership or otherwise provide funds to enable the Partnership to fund its
obligations under this section, except to the extent otherwise expressly agreed to by such Partner
and the Partnership.




24









 








     6.02 DELEGATION OF AUTHORITY. The General Partner may delegate any or all of its
powers, rights and obligations hereunder to any Person that the General Partner may from time to
time determine, including, without limitation, the officers and employees of the Partnership, the
General Partner, the Company and any Subsidiary of the Company and may further appoint, employ,
contract or otherwise deal with any Person for the transaction of the business of the Partnership,
which Person may, under supervision of the General Partner, perform any acts or services for the
Partnership as the General Partner may approve. Without limiting the generality of the foregoing,
the following officers of the Partnership, who, subject to the general supervision and control of
the General Partner, may exercise the rights and powers of the General Partner to manage the
day-to-day operations of the Partnership: Chief Executive Officer, President, one or more Vice
Presidents, Chief Financial Officer, Chief Operations Officer, Secretary and Treasurer.



     6.03 INDEMNIFICATION AND EXCULPATION OF INDEMNITEES.




     (a) The Partnership shall indemnify an Indemnitee from and against any and
all losses, claims, damages, liabilities, joint or several, expenses (including reasonable
legal fees and expenses), judgments, fines, settlements, and other amounts arising from any
and all claims, demands, actions, suits or proceedings, civil, criminal, administrative or
investigative, that relate to the operations of the Partnership as set forth in this
Agreement in which any Indemnitee may be involved, or is threatened to be involved, as a
party or otherwise, unless it is established that: (i) the act or omission of the
Indemnitee was material to the matter giving rise to the proceeding and either was
committed in bad faith or was the result of active and deliberate dishonesty; (ii) the
Indemnitee actually received an improper personal benefit in money, property or services;
or (iii) in the case of any criminal proceeding, the Indemnitee had reasonable cause to
believe that the act or omission was unlawful. 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 6.03(a). The termination
of any proceeding by conviction or upon a plea of nolo contendere or its equivalent, or an
entry of an order of probation prior to judgment, creates a rebuttable presumption that the
Indemnitee acted in a manner contrary to that specified in this Section 6.03(a). Any
indemnification pursuant to this Section 6.03 shall be made only out of the assets of the
Partnership.




     (b) The Partnership shall reimburse an Indemnitee for reasonable expenses
incurred by an Indemnitee who is a party to a proceeding in advance of the final
disposition of the proceeding upon receipt by the Partnership of (i) a written affirmation
by the Indemnitee of the Indemnitee’s good faith belief that the standard of conduct
necessary for indemnification by the Partnership as authorized in this Section 6.03 has
been met, and (ii) a written undertaking by or on behalf of the Indemnitee to repay the
amount if it shall ultimately be determined that the standard of conduct has not been met.




     (c) The indemnification provided by this Section 6.03 shall be in addition
to any other rights to which an Indemnitee or any other Person may be entitled under any
agreement, pursuant to any vote of the Partners, as a matter of law or otherwise, and shall
continue as to an Indemnitee who has ceased to serve in such capacity.




     (d) The Partnership may, but shall not be obligated to, purchase and
maintain insurance, on behalf 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



25









 






of whether the Partnership would have the power to indemnify such Person against such
liability under the provisions of this Agreement.




     (e) For purposes of this Section 6.03, the Partnership shall be deemed to
have requested an Indemnitee to serve as fiduciary of an employee benefit plan whenever the
performance by it of its duties to the Partnership also imposes duties on, or otherwise
involves services by, it to the plan or participants or beneficiaries of the plan; excise
taxes assessed on an Indemnitee with respect to an employee benefit plan pursuant to
applicable law shall constitute fines within the meaning of this Section 6.03; and actions
taken or omitted by the Indemnitee with respect to an employee benefit plan in the
performance of its duties for a purpose reasonably believed by it to be in the interest of
the participants and beneficiaries of the plan shall be deemed to be for a purpose that is
not opposed to the best interests of the Partnership.




     (f) In no event may an Indemnitee subject the Limited Partners to personal
liability by reason of the indemnification provisions set forth in this Agreement.




     (g) An Indemnitee shall not be denied indemnification in whole or in part
under this Section 6.03 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 6.03 are for the benefit of the
Indemnitees, their heirs, successors, assigns and administrators and shall not be deemed to
create any rights for the benefit of any other Persons.




     (i) Any amendment, modification or repeal of this Section 6.03 or any
provision hereof shall be prospective only and shall not in any way affect the
indemnification of an Indemnitee by the Partnership under this Section 6.03 as in effect
immediately prior to such amendment, modification or repeal with respect to matters
occurring, in whole or in part, prior to such amendment, modification or repeal, regardless
of when claims relating to such matters may arise or be asserted.




     (j) If and to the extent any reimbursements to the General Partner pursuant
to this section constitute gross income of the General Partner (as opposed to the repayment
of advances made by the General Partner on behalf of the Partnership) such amounts shall
constitute guaranteed payments within the meaning of Section 707(c) of the Code, shall be
treated consistently therewith by the Partnership and all Partners, and shall not be
treated as distributions for purposes of computing the Partners’ Capital Accounts.



     6.04 LIABILITY OF THE GENERAL PARTNER.




     (a) Notwithstanding anything to the contrary set forth in this Agreement,
none of the General Partner, the Company, nor any of their directors, officers, agents or
employees shall be liable for monetary damages to the Partnership or any Partners for
losses sustained or liabilities incurred or benefits not derived as a result of errors in
judgment or mistakes of fact or law or of any act or omission if the General Partner acted
in good faith. The General Partner shall not be in breach of any duty that the General
Partner may owe to the Limited Partners or the Partnership or any other Persons under



26









 






this Agreement or of any duty stated or implied by law or equity provided the General
Partner, acting in good faith, abides by the terms of this Agreement.




     (b) The Limited Partners expressly acknowledge that the General Partner is
acting on behalf of the Partnership and the Company’s stockholders collectively, that the
General Partner is under no obligation to consider the separate interests of the Limited
Partners (including, without limitation, the tax consequences to Limited Partners or the
tax consequences to some, but not all, of the Limited Partners) in deciding whether to
cause the Partnership to take (or decline to take) any actions. In the event of a conflict
between the interests of the stockholders of the Company on one hand and the Limited
Partners on the other, the General Partner shall endeavor in good faith to resolve the
conflict in a manner not adverse to either the stockholders of the Company or the Limited
Partners; provided, however, that for so long as the Company owns a controlling interest in
the Partnership, any such conflict that the General Partner, in its sole and absolute
discretion, determines cannot be resolved in a manner not adverse to either the
stockholders of the Company or the Limited Partners shall be resolved in favor of the
stockholders of the Company. The General Partner shall not be liable for monetary damages
for losses sustained, liabilities incurred or benefits not derived by Limited Partners in
connection with such decisions.




     (c) Subject to its obligations and duties as General Partner set forth in
Section 6.01 hereof, the General Partner may exercise any of the powers granted to it under
this Agreement and perform any of the duties imposed upon it hereunder either directly or
by or through its agents. The General Partner shall not be responsible for any misconduct
or negligence on the part of any such agent appointed by it in good faith.




     (d) Notwithstanding any other provisions 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 Company to continue to qualify as a REIT or (ii) to prevent the Company from
incurring any taxes under Section 857, Section 4981, or any other provision of the Code, is
expressly authorized under this Agreement and is deemed approved by all of the Limited
Partners.




     (e) Any amendment, modification or repeal of this Section 6.04 or any
provision hereof shall be prospective only and shall not in any way affect the limitations
on the General Partner’s or any of its officer’s, director’s, agent’s or employee’s
liability to the Partnership and the Limited Partners under this Section 6.04 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 claims relating to such matters may arise or be
asserted.



     6.05 PARTNERSHIP OBLIGATIONS.




     (a) Except as provided in this Section 6.05 and elsewhere in this Agreement
(including the provisions of Articles V and VI regarding distributions, payments and
allocations to which it may be entitled), the General Partner shall not be compensated for
its services as general partner of the Partnership.



27









 






     (b) All Administrative Expenses shall be obligations of the Partnership, and
each of the General Partner and the Company shall be entitled to reimbursement by the
Partnership for any expenditure (including Administrative Expenses) incurred by it on
behalf of the Partnership that shall be made other than out of the funds of the
Partnership.



     6.06 OUTSIDE ACTIVITIES. Subject to Section 6.08 hereof, the Articles of
Incorporation and any agreements entered into by the General Partner, the Company or any of their
respective Affiliates with the Partnership, any Subsidiary or any officer, director, employee,
agent, trustee, Affiliate or stockholder of the Company, the General Partner and the Company 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 substantially
similar or identical to those of the Partnership. None of the Partnership, the Limited Partners nor
any other Person shall have any rights by virtue of this Agreement or the partnership relationship
established hereby in any such business ventures, interests or activities, and the General Partner
and the Company shall have no obligation pursuant to this Agreement to offer any interest in any
such business ventures, interests and activities to the Partnership or any Limited Partner, even if
such opportunity is of a character that, if presented to the Partnership or any Limited Partner,
could be taken by such Person.



     6.07 AFFILIATES; SUBSIDIARIES; JOINT VENTURES.




     (a) Any Affiliate of the General Partner may be employed or retained by the
Partnership and may otherwise deal with the Partnership (whether as a buyer, lessor,
lessee, manager, furnisher of goods or services, broker, agent, lender or otherwise) and
may receive from the Partnership any compensation, price or other payment therefor that the
General Partner determines to be fair and reasonable.




     (b) The Partnership may lend or contribute to its Subsidiaries or other
Persons in which it has an equity investment, and such Persons may borrow funds from the
Partnership, on terms and conditions established in the sole and absolute discretion of the
General Partner. The foregoing authority shall not create any right or benefit in favor of
any Subsidiary or any other Person.




     (c) The Partnership may transfer assets to joint ventures, other
partnerships, corporations or other business entities in which it is or thereby becomes a
participant upon such terms and subject to such conditions as the General Partner deems are
consistent with this Agreement and applicable law.



     6.08 GENERAL PARTNER ACTIVITIES. The General Partner and the Company agree that,
generally, all business activities of the General Partner and the Company, including activities
pertaining to the acquisition, development or ownership of a healthcare property or other property,
shall be conducted through the Partnership or one or more Subsidiaries of the Partnership;
provided, however, that the General Partner or the Company may make a direct acquisition or
undertake a business activity directly if such acquisition is made in connection with the issuance
of Additional Securities and direct acquisition and issuance or the business activity has been
approved by a majority of the Board Directors.



     6.09 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, shall have any ownership



28









 




interest in such Partnership assets or any portion thereof. Title to any or all of the
Partnership assets may be held in the name of the Partnership, the General Partner or one or more
nominees, as the General Partner may determine, including Affiliates of the General Partner. The
General Partner hereby declares and warrants that any Partnership assets for which legal title is
held in the name of the General Partner or any nominee or Affiliate of the General Partner shall be
held by the General Partner for the use and benefit of the Partnership in accordance with the
provisions of this Agreement; provided, however, that the General Partner shall use its best
efforts to cause beneficial and record title to such assets to be vested in the Partnership as soon
as reasonably practicable. All Partnership assets shall be recorded as the property of the
Partnership in its books and records, irrespective of the name in which legal title to such
Partnership assets is held.




     6.10 REDEMPTION OF COMPANY PARTNERSHIP UNITS. In the event the Company redeems or
repurchases any REIT Shares, then the General Partner shall cause the Partnership to purchase from
the Company a number of Partnership Units as determined based on the application of the Conversion
Factor on substantially the same terms that the Company redeemed such REIT Shares. Moreover, if
the Company makes a cash tender offer or other offer to acquire REIT Shares, then the General
Partner shall cause the Partnership to make a corresponding offer to the Company to acquire an
equal number of Partnership Units held by the Company. In the event any REIT Shares are exchanged
by the Company pursuant to such offer, the Partnership shall redeem an equivalent number of the
Company’s Partnership Units for an equivalent purchase price based on the application of the
Conversion Factor.



ARTICLE VII

CHANGES IN THE COMPANY OR THE GENERAL PARTNER




     7.01 TRANSFER OF THE GENERAL PARTNER’S PARTNERSHIP INTEREST.




     (a) Except as provided in Section 4.02 or Section 6.10 hereof, neither the
General Partner nor the Company shall transfer all or any portion of its Partnership
Interest and the General Partner shall not withdraw as General Partner except as provided
in or in connection with a transaction contemplated by Section 7.01(c), (d) or (e).




     (b) The General Partner agrees that its Percentage Interest will at all
times be in the aggregate at least 1%.




     (c) Except as otherwise provided in Section 7.01(d) hereof, the Company
shall not engage in any merger, consolidation or other combination with or into another
Person or sale of all or substantially all of its assets (other than in connection with a
change in the Company’s state of incorporation or organizational form), in each case that
results in a change of control of the Company (a “Transaction”), unless at least one of the
following conditions is met:




     (i) the consent of the holders of Common Units (other than the General
Partner, the Company or any Subsidiary of either of them) holding more than 50%
of the percentage interests of the holders of Common Units (other than those held
by the General Partner or any Subsidiary) is obtained; or



29









 






     (ii) as a result of such Transaction all holders of Common Units will
receive, or have the right to elect to receive, for each Common Unit an amount of
cash, securities or other property equal in value to the product of the
Conversion Factor and the greatest amount of cash, securities or other property
paid in the Transaction to a holder of one REIT Share in consideration of one
REIT Share, provided that if, in connection with the Transaction, a purchase,
tender or exchange offer (“Offer”) shall have been made to and accepted by the
holders of more than 50% of the outstanding REIT Shares, each holder of
Partnership Units shall be given the option to exchange its Partnership Units for
the greatest amount of cash, securities or other property that a Limited Partner
would have received had it (A) exercised its Redemption Right and (B) sold,
tendered or exchanged pursuant to the Offer the REIT Shares received upon
exercise of the Redemption Right immediately prior to the expiration of the
Offer; or




     (iii) the General Partner or the Company is the surviving entity in the
Transaction and either (A) the holders of REIT Shares do not receive cash,
securities or other property in the Transaction or (B) all holders of Common
Units (other than the General Partner or any Subsidiary) receive for each Common
Unit an amount of cash, securities or other property having a value (expressed as
an amount per REIT Share) that is no less than the product of the Conversion
Factor and the greatest amount of cash, securities or other property (expressed
as an amount per REIT Share) received in the Transaction by any holder of REIT
Shares.




     (d) Notwithstanding Section 7.01(c), the General Partner or the Company may
merge with or into or consolidate with another entity if immediately after such merger or
consolidation (i) substantially all of the assets of the successor or surviving entity (the
“Survivor”), other than Partnership Units held by the General Partner or the Company, are
contributed, directly or indirectly, to the Partnership as a Capital Contribution in
exchange for Partnership Units with a fair market value equal to the value of the assets so
contributed as determined by the Survivor in good faith and (ii) the Survivor expressly
agrees to assume all obligations of the General Partner and the Company hereunder. Upon
such contribution and assumption, the Survivor shall have the right and duty to amend this
Agreement as set forth in this Section 7.01(d). The Survivor shall in good faith arrive at
a new method for the calculation of the Cash Amount, the REIT Shares Amount and Conversion
Factor for a Partnership Unit after any such merger or consolidation so as to approximate
the existing method for such calculation as closely as reasonably possible. Such
calculation shall take into account, among other things, the kind and amount of securities,
cash and other property that was receivable upon such merger or consolidation by a holder
of REIT Shares or options, warrants or other rights relating thereto, and which a holder of
Partnership Units could have acquired had such Partnership Units been exchanged immediately
prior to such merger or consolidation. Such amendment to this Agreement shall provide for
adjustment to such method of calculation, which shall be as nearly equivalent as may be
practicable to the adjustments provided for with respect to the Conversion Factor. The
Survivor also shall in good faith modify the definition of REIT Shares and make such
amendments to Section 8.04 hereof so as to approximate the existing rights and obligations
set forth in Section 8.04 as closely as reasonably possible. The above provisions of this
Section 7.01(d) shall similarly apply to successive mergers or consolidations permitted
hereunder.



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     (e) Notwithstanding anything in this Article VII,




     (i) the General Partner may transfer all or any portion of its General
Partnership Interest to (A) the Company or (B) any direct or indirect Subsidiary
of the Company and, following a transfer of all of its General Partnership
Interest, may withdraw as General Partner; and




     (ii) the General Partner or the Company may engage in a transaction required
by law or by the rules of any national securities exchange on which the REIT
Shares are listed.



     7.02 ADMISSION OF A SUBSTITUTE OR ADDITIONAL GENERAL PARTNER. A Person shall be
admitted as a substitute or additional General Partner of the Partnership only if the following
terms and conditions are satisfied:




     (a) the Person to be admitted as a substitute or additional General Partner
shall have accepted and agreed to be bound by all the terms and provisions of this
Agreement by executing a counterpart thereof and such other documents or instruments as may
be required or appropriate in order to effect the admission of such Person as a General
Partner, and a certificate evidencing the admission of such Person as a General Partner
shall have been filed for recordation and all other actions required by Section 2.06 hereof
in connection with such admission shall have been performed;




     (b) if the Person to be admitted as a substitute or additional General
Partner is a corporation or a partnership, it shall have provided the Partnership with
evidence satisfactory to counsel for the Partnership of such Person’s authority to become a
General Partner and to be bound by the terms and provisions of this Agreement; and




     (c) counsel for the Partnership shall have rendered an opinion (relying on
such opinions from other counsel as may be necessary) that the admission of the Person to
be admitted as a substitute or additional General Partner is in conformity with the Act,
that none of the actions taken in connection with the admission of such Person as a
substitute or additional General Partner will cause (i) the Partnership to be classified
other than as a partnership for federal income tax purposes, or (ii) the loss of any
Limited Partner’s limited liability.



     7.03 EFFECT OF BANKRUPTCY, WITHDRAWAL, DEATH OR DISSOLUTION OF A GENERAL PARTNER.




     (a) Upon the occurrence of an Event of Bankruptcy as to a General Partner or
the death, withdrawal, removal or dissolution of a General Partner (except that, if a
General Partner is on the date of such occurrence a partnership, the withdrawal, death,
dissolution, Event of Bankruptcy as to, or removal of a partner in, such partnership shall
be deemed not to be a dissolution of such General Partner if the business of such General
Partner is continued by the remaining partner or partners), the Partnership shall be
dissolved and terminated unless the Partnership is continued pursuant to Section 7.03(b)
hereof. The merger of a General Partner with or into any entity that is admitted as a
substitute or successor General Partner pursuant to Section 7.02 hereof shall not be deemed
to be the withdrawal, dissolution or removal of the General Partner.



31









 






     (b) Following the occurrence of an Event of Bankruptcy as to a General Partner or
the death, withdrawal, removal or dissolution of a General Partner (except that, if a
General Partner is on the date of such occurrence a partnership, the withdrawal, death,
dissolution, Event of Bankruptcy as to, or removal of a partner in, such partnership shall
be deemed not to be a dissolution of such General Partner if the business of such General
Partner is continued by the remaining partner or partners), the Limited Partners, within 90
days after such occurrence, may elect to continue the business of the Partnership for the
balance of the term specified in Section 2.04 hereof by selecting, subject to Section 7.02
hereof and any other provisions of this Agreement, a substitute General Partner by consent
of a majority in interest of the Limited Partners. If the Limited Partners elect to
continue the business of the Partnership and admit a substitute General Partner, the
relationship with the Partners and of any Person who has acquired an interest of a Partner
in the Partnership shall be governed by this Agreement.



     7.04 REMOVAL OF A GENERAL PARTNER.




     (a) If on the date of an occurrence of an Event of Bankruptcy as to, or the
dissolution of, a General Partner, such General Partner is a partnership, the withdrawal,
death, dissolution, Event of Bankruptcy as to or removal of a partner in such partnership
shall be deemed not to be a dissolution of the General Partner if the business of such
General Partner is continued by the remaining partner or partners. The Limited Partners may
not remove the General Partner, with or without cause.




     (b) If a General Partner has been removed pursuant to Section 7.03 and the
Partnership is continued pursuant to Section 7.03 hereof, such General Partner shall
promptly transfer and assign its General Partnership Interest in the Partnership to the
substitute General Partner approved by a majority in interest of the Limited Partners in
accordance with Section 7.03(b) hereof and otherwise admitted to the Partnership in
accordance with Section 7.02 hereof. At the time of assignment, the removed General Partner
shall be entitled to receive from the substitute General Partner the fair market value of
the General Partnership Interest of such removed General Partner as reduced by any damages
caused to the Partnership by such General Partner. Such fair market value shall be
determined by an appraiser mutually agreed upon by the General Partner and a majority in
interest of the Limited Partners (excluding the Company) within 10 days following the
removal of the General Partner. In the event that the parties are unable to agree upon an
appraiser, the removed General Partner and a majority in interest of the Limited Partners
(excluding the Company) each shall select an appraiser. Each such appraiser shall complete
an appraisal of the fair market value of the removed General Partner’s General Partnership
Interest within 30 days of the General Partner’s removal, and the fair market value of the
removed General Partner’s General Partnership Interest shall be the average of the two
appraisals; provided, however, that if the higher appraisal exceeds the lower appraisal by
more than 20% of the amount of the lower appraisal, the two appraisers, no later than 40
days after the removal of the General Partner, shall select a third appraiser who shall
complete an appraisal of the fair market value of the removed General Partner’s General
Partnership Interest no later than 60 days after the removal of the General Partner. In
such case, the fair market value of the removed General Partner’s



32









 






General Partnership Interest shall be the average of the two appraisals closest in
value. The cost of all such appraisals shall be borne by the Partnership.




     (c) The General Partnership Interest of a removed General Partner, during
the time after removal until transfer under Section 7.04(b), shall be converted to that of
a special Limited Partner; provided, however, such removed General Partner shall not have
any rights to participate in the management and affairs of the Partnership, and shall not
be entitled to any portion of the income, expense, profit, gain or loss allocations or cash
distributions allocable or payable, as the case may be, to the Limited Partners. Instead,
such removed General Partner shall receive and be entitled only to retain distributions or
allocations of such items that it would have been entitled to receive in its capacity as
General Partner, until the transfer is effective pursuant to Section 7.04(b).




     (d) All Partners shall have given and hereby do give such consents, shall
take such actions and shall execute such documents as shall be legally necessary and
sufficient to effect all the foregoing provisions of this Section.



ARTICLE VIII

RIGHTS AND OBLIGATIONS

OF THE LIMITED PARTNERS




     8.01 MANAGEMENT OF THE PARTNERSHIP. The Limited Partners shall not participate in
the management or control of Partnership business nor shall they transact any business for the
Partnership, nor shall they have the power to sign for or bind the Partnership, such powers being
vested solely and exclusively in the General Partner.



     8.02 POWER OF ATTORNEY. Subject to Section 8.03, each Limited Partner hereby
irrevocably appoints the General Partner its true and lawful attorney-in-fact, who may act for each
Limited Partner and in its name, place and stead, and for its use and benefit, to sign,
acknowledge, swear to, deliver, file or record, at the appropriate public offices, any and all
documents, certificates and instruments as may be deemed necessary or desirable by the General
Partner to carry out fully the provisions of this Agreement and the Act in accordance with their
terms, including amendments hereto, which power of attorney is coupled with an interest and shall
survive the death, dissolution or legal incapacity of the Limited Partner, or the transfer by the
Limited Partner of any part or all of its Partnership Interest.



     8.03 LIMITATION ON LIABILITY OF LIMITED PARTNERS. No Limited Partner shall be liable
for any debts, liabilities, contracts or obligations of the Partnership. A Limited Partner shall be
liable to the Partnership only to make payments of its Capital Contribution, if any, as and when
due hereunder. After its Capital Contribution is fully paid, no Limited Partner shall, except as
otherwise required by the Act, be required to make any further Capital Contributions or other
payments or lend any funds to the Partnership.



     8.04 REDEMPTION RIGHT.




     (a) Subject to Sections 8.04(b), 8.04(c), 8.04(d), 8.04(e) and 8.04(f) and
the provisions of any agreements between the Partnership and one or more Limited Partners
with respect to Partnership Units held by them, each Limited Partner, other than the
Company, shall have the right (the “Redemption Right”) to require the Partnership to redeem
on a Specified Redemption Date all or a portion of the Partnership Units held by



33









 






such Limited Partner at a redemption price equal to and in the form of the Redemption
Amount to be paid by the Partnership, provided that such Partnership Units shall have been
outstanding for at least one year, and subject to any restriction agreed to in writing
between the Redeeming Limited Partner and the General Partner or the Partnership. The
Redemption Right shall be exercised pursuant to a Notice of Redemption delivered to the
Partnership (with a copy to the Company) by the Limited Partner who is exercising the
Redemption Right (the “Redeeming Limited Partner”); provided, further, that the Partnership
shall, in its sole and absolute discretion, have the option to deliver either the Cash
Amount or the REIT Shares Amount; provided, further, that the Partnership shall not be
obligated to satisfy such Redemption Right if the Company elects to purchase the
Partnership Units subject to the Notice of Redemption; and provided, further, that no
Limited Partner may deliver more than two Notices of Redemption during each calendar year.
Subject to the immediately succeeding sentence, a Limited Partner may not, without the
consent of the General Partner, exercise the Redemption Right for less than 1,000
Partnership Units. If a Limited Partner holds less than 1,000 Partnership Units, such
Limited Partner may, without the consent of the General Partner, exercise the Redemption
Right for all of the Partnership Units held by such Partner. The Redeeming Limited Partner
shall have no right, with respect to any Partnership Units so redeemed, to receive any
distribution paid with respect to Partnership Units if the record date for such
distribution is on or after the Specified Redemption Date. LTIP Unit Limited Partners
shall not be entitled to redeem their LTIP Units provided for in Section 8.04 of this
Agreement, unless and until such LTIP Units have been converted into Common Units.
Notwithstanding the foregoing, and except as otherwise permitted by the award, plan or
other agreement pursuant to which an LTIP Unit was issued, the right to redeem shall not be
exercisable with respect to any Common Unit issued upon conversion of an LTIP Unit until
two years after the date on which the LTIP Unit was issued, provided however, that the
foregoing restriction shall not apply if the right to redeem is exercised by an LTIP Unit
holder in connection with a transaction that falls within the definition of a “change of
control” under the agreement or agreements pursuant to which the LTIP Units were issued to
such holder.




     (b) Notwithstanding the provisions of Section 8.04(a), a Limited Partner
that exercises the Redemption Right shall be deemed to have offered to sell the Partnership
Units described in the Notice of Redemption to the Company, and the Company may, in its
sole and absolute discretion, elect to purchase directly and acquire such Partnership Units
by paying to the Redeeming Limited Partner either the Cash Amount or the REIT Shares
Amount, as elected by the Company (in its sole and absolute discretion), on the Specified
Redemption Date, whereupon the Company shall acquire the Partnership Units offered for
redemption by the Redeeming Limited Partner and shall be treated for all purposes of this
Agreement as the owner of such Partnership Units. If the Company shall elect to exercise
its right to purchase Partnership Units under this Section 8.04(b) with respect to a Notice
of Redemption, it shall so notify the Redeeming Limited Partner within five Business Days
after the receipt by the Company of such Notice of Redemption. In the event the Company
shall exercise its right to purchase Partnership Units with respect to the exercise of a
Redemption Right, the Partnership shall have no obligation to pay any amount to the
Redeeming Limited Partner with respect to such Redeeming Limited Partner’s exercise of such
Redemption Right, and each of the Redeeming Limited Partner, the Partnership and the
Company shall treat the transaction between the Company and the Redeeming Limited Partner
for federal income tax purposes as a sale of the Redeeming Limited Partner’s Partnership
Units to the Company. Each Redeeming Limited Partner agrees to execute such documents as
the Company may



34









 






reasonably require in connection with the issuance of REIT Shares upon exercise of the
Redemption Right.



     (c) Notwithstanding the provisions of Section 8.04(a) and 8.04(b), a Limited
Partner shall not be entitled to exercise the Redemption Right if the delivery of REIT
Shares to such Partner on the Specified Redemption Date by the Company pursuant to Section
8.04(b) (regardless of whether or not the Company would in fact exercise its rights under
Section 8.04(b)) would (i) result in such Partner or any other person owning, directly or
indirectly, REIT Shares in excess of the Ownership Limitation (as defined in the Articles
of Incorporation) and calculated in accordance therewith, except as provided in the
Articles of Incorporation, (ii) result in REIT Shares being owned by fewer than 100 persons
(determined without reference to any rules of attribution), (iii) result in the Company
being “closely held” within the meaning of Section 856(h) of the Code, (iv) cause the
Company to own, directly or constructively, 10% or more of the ownership interests in a
tenant of the Company’s, the Partnership’s or a Subsidiary Partnership’s real property,
within the meaning of Section 856(d)(2)(B) of the Code, or (v) cause the acquisition of
REIT Shares by such Partner to be “integrated” with any other distribution of REIT Shares
for purposes of complying with the registration provisions of the Securities Act of 1933,
as amended (the “Securities Act”). The General Partner, in its sole and absolute
discretion, may waive the restriction on redemption set forth in this Section 8.04(c).


The consummation of any redemption in exchange for REIT Shares shall be subject to the expiration
or termination of any waiting period under applicable law.





     (d) Any Cash Amount to be paid to a Redeeming Limited Partner pursuant to
this Section 8.04 shall be paid on the Specified Redemption Date; provided, however, that
the General Partner may elect to cause the Specified Redemption Date to be delayed for up
to an additional 90 days to the extent required for the Company to cause additional REIT
Shares to be issued to provide financing to be used to make such payment of the Cash
Amount. Notwithstanding the foregoing, the General Partner agrees to use its best efforts
to cause the closing of the acquisition of redeemed Partnership Units hereunder to occur as
quickly as reasonably possible.




     (e) Notwithstanding any other provision of this Agreement, the General
Partner is authorized to take any action that it determines to be necessary or appropriate
to cause the Partnership to comply with any withholding requirements established under the
Code or any other federal, state or local law that apply upon a Redeeming Limited Partner’s
exercise of the Redemption Right. If a Redeeming Limited Partner believes that it is exempt
from such withholding upon the exercise of the Redemption Right, such Partner must furnish
the General Partner with a FIRPTA Certificate in the form attached hereto as Exhibit C. If
the Partnership, the Company or the General Partner is required to withhold and pay over to
any taxing authority any amount upon a Redeeming Limited Partner’s exercise of the
Redemption Right and if the Redemption Amount equals or exceeds the Withheld Amount, the
Withheld Amount shall be treated as an amount received by such Partner in redemption of its
Partnership Units. If, however, the Redemption Amount is less than the Withheld Amount, the
Redeeming Limited Partner shall not receive any portion of the Redemption Amount, the
Redemption Amount shall be treated as an amount received by such Partner in redemption of
its Partnership Units, and the Partner shall contribute the excess of the Withheld Amount
over the Redemption



35









 






Amount to the Partnership before the Partnership is required to pay over such excess
to a taxing authority.




     (f) Notwithstanding any other provision of this Agreement, the General
Partner shall place appropriate restrictions on the ability of the Limited Partners to
exercise their Redemption Rights as and if deemed necessary to ensure that there is not a
material risk that the Partnership will be treated as a “publicly traded partnership”
taxable as a corporation under section 7704 of the Code. If and when the General Partner
determines that imposing such restrictions is necessary, the General Partner shall give
prompt written notice thereof (a “Restriction Notice”) to each of the Limited Partners,
which notice shall be accompanied by a copy of an opinion of counsel to the Partnership to
the effect that such restrictions should be imposed to ensure that there is not a material
risk of the Partnership being treated as a “publicly traded partnership” under section 7704
of the Code.



ARTICLE IX

TRANSFERS OF PARTNERSHIP INTERESTS




     9.01 PURCHASE FOR INVESTMENT.




     (a) Each Limited Partner hereby represents and warrants to the General
Partner and to the Partnership that (i) the acquisition of its Partnership Interests and
Partnership Units is made as a principal for its account for investment purposes only and
not with a view to the resale or distribution of such Partnership Interest or Partnership
Units, (ii) the Limited Partner understands and agrees that its acquisition of Partnership
Interests and Partnership Units are being made in reliance on an exemption from
registration under the Securities Act, and (iii) the Limited Partner is an “accredited
investor” as that term may be defined pursuant to the rules and regulations of the
Securities and Exchange Commission from time to time.




     (b) Subject to the provisions of Section 9.02, each Limited Partner agrees
that it will not sell, assign or otherwise transfer his Partnership Interest or Partnership
Units or any fraction thereof, whether voluntarily or by operation of law or at judicial
sale or otherwise, to any Person who does not make the representations and warranties to
the General Partner and the Partnership set forth in Section 9.01(a) above.



     9.02 RESTRICTIONS ON TRANSFER OF PARTNERSHIP INTERESTS.




     (a) Subject to the provisions of Sections 9.02(b), (c) and (d), no Limited
Partner may offer, sell, assign, hypothecate, pledge or otherwise transfer all or any
portion of his Partnership Interest or Partnership Units, or any of such Limited Partner’s
economic rights as a Limited Partner, whether voluntarily or by operation of law or at
judicial sale or otherwise (collectively, a “Transfer”) without the consent of the General
Partner, which consent may be granted or withheld in its sole and absolute discretion. Any
such purported transfer undertaken without such consent shall be considered to be null and
void ab initio and shall not be given effect. The General Partner may require, as a
condition of any Transfer to which it consents, that the transferor assume all costs
incurred by the Partnership in connection therewith.



36









 






     (b) No Limited Partner may withdraw from the Partnership other than as a
result of a permitted Transfer (i.e., a Transfer consented to as contemplated by clause (a)
above or clause (c) below or a Transfer pursuant to Section 9.05 below) of all of his
Partnership Units pursuant to this Article IX or pursuant to a redemption of all of his
Partnership Units pursuant to Section 8.04. Upon the permitted Transfer or redemption of
all of a Limited Partner’s Partnership Units, such Limited Partner shall cease to be a
Limited Partner.




     (c) Subject to Sections 9.02(d) and (e) below, a Limited Partner may
Transfer, with the consent of the General Partner, all or a portion of his Partnership
Units to (i) a parent or parent’s spouse, natural or adopted descendant or descendants,
spouse of such descendant, or brother or sister, or a trust created by such Limited Partner
for the benefit of such Limited Partner and/or any such person(s), of which trust such
Limited Partner or any such person(s) is a trustee, (ii) a corporation, partnership or
limited liability company controlled by a Person or Persons named in (i) above or (iii) if
the Limited Partner is an entity, its beneficial owners.




     (d) No Limited Partner may effect a Transfer of its Partnership Interest or
Partnership Units, in whole or in part, if, in the opinion of legal counsel for the
Partnership, such proposed Transfer would require the registration of the Partnership
Interest or Partnership Units under the Securities Act or would otherwise violate any
applicable federal or state securities or blue sky law (including investment suitability
standards).




     (e) No Transfer by a Limited Partner of its Partnership Interest or
Partnership Units, in whole or in part, may be made to any Person if (i) in the opinion of
legal counsel for the Partnership, the transfer could reasonably be expected to result in a
material risk of the Partnership’s being treated as a publicly traded partnership taxable
as a corporation or an association taxable as a corporation (other than a qualified REIT
subsidiary within the meaning of Section 856(i) of the Code) or (ii) in the opinion of
legal counsel for the Partnership, it could reasonably be expected to adversely affect the
ability of the Company to continue to qualify as a REIT or subject the Company to any
additional taxes under Section 857 or Section 4981 of the Code.




     (f) Any purported Transfer in contravention of any of the provisions of this
Article IX shall be void ab initio and ineffectual and shall not be binding upon, or
recognized by, the General Partner or the Partnership.




     (g) Prior to and as a condition of the consummation of any Transfer under
this Article IX, the transferor and/or the transferee shall deliver to the General Partner
such opinions, certificates and other documents as the General Partner shall request in
connection with such Transfer.



     9.03 ADMISSION OF SUBSTITUTE LIMITED PARTNER.




     (a) Subject to the other provisions of this Article IX, an assignee of the
Partnership Interest of a Limited Partner (which shall be understood to include any
purchaser, transferee, donee or other recipient of any disposition of such Partnership
Interest) or Partnership Units shall be deemed admitted as a Limited Partner of the
Partnership only with the consent of the General Partner, which consent may be given or



37









 






withheld by the General Partner in its sole and absolute discretion, and upon the
satisfactory completion of the following:




     (i) The assignee shall have accepted and agreed to be bound by the terms and
provisions of this Agreement by executing a counterpart or an amendment thereof,
including a revised Exhibit A, and such other documents or instruments as the
General Partner may require in order to effect the admission of such Person as a
Limited Partner.




     (ii) To the extent required, an amended Certificate evidencing the admission
of such Person as a Limited Partner shall have been signed, acknowledged and
filed for record in accordance with the Act.




     (iii) The assignee shall have delivered a letter containing the
representation set forth in Section 9.01(a) hereof and the agreement set forth in
Section 9.01(b) hereof.




     (iv) If the assignee is a corporation, partnership or trust, the assignee
shall have provided the General Partner with evidence satisfactory to counsel for
the Partnership of the assignee’s authority to become a Limited Partner under the
terms and provisions of this Agreement.




     (v) The assignee shall have executed a power of attorney containing the
terms and provisions set forth in Section 8.02 hereof.




     (vi) The assignee shall have paid all legal fees and other expenses of the
Partnership and the General Partner and filing and publication costs in
connection with its substitution as a Limited Partner.




     (vii) The assignee shall have obtained the prior written consent of the
General Partner to its admission as a Substitute Limited Partner, which consent
may be given or denied in the exercise of the General Partner’s sole and absolute
discretion.




     (b) For the purpose of allocating Profits and Losses and distributing cash
received by the Partnership, a Substitute Limited Partner shall be treated as having
become, and appearing in the records of the Partnership as, a Partner upon the filing of
the Certificate described in Section 9.03(a)(ii) hereof or, if no such filing is required,
the later of the date specified in the transfer documents or the date on which the General
Partner has received all necessary instruments of transfer and substitution.




     (c) The General Partner shall cooperate with the Person seeking to become a
Substitute Limited Partner by preparing the documentation required by this Section and
making all official filings and publications. The Partnership shall take all such action as
promptly as practicable after the satisfaction of the conditions in this Article IX to the
admission of such Person as a Limited Partner of the Partnership.




     (d) The General Partner’s failure or refusal to permit a transferee of any
such interests to become a Substitute Limited Partner shall not give rise to any cause of
action against the Partnership or any partner.



38









 





     9.04 RIGHTS OF ASSIGNEES OF PARTNERSHIP INTERESTS.




     (a) Subject to the provisions of Sections 9.01 and 9.02 hereof, except as
required by operation of law, the Partnership shall not be obligated for any purposes
whatsoever to recognize the assignment by any Limited Partner of its Partnership Interest
or Partnership Units until the Partnership has received notice thereof.




     (b) Any Person who is the assignee of all or any portion of a Limited
Partner’s Partnership Interest or Partnership Units, but does not become a Substitute
Limited Partner and desires to make a further assignment of such Partnership Interest or
Partnership Units, shall be subject to all the provisions of this Article IX to the same
extent and in the same manner as any Limited Partner desiring to make an assignment of its
Partnership Interest or Partnership Units.



     9.05 EFFECT OF BANKRUPTCY, DEATH, INCOMPETENCE OR TERMINATION OF A LIMITED PARTNER.
The occurrence of an Event of Bankruptcy as to a Limited Partner, the death of a Limited Partner or
a final adjudication that a Limited Partner is incompetent (which term shall include, but not be
limited to, insanity) shall not cause the termination or dissolution of the Partnership, and the
business of the Partnership shall continue if an order for relief in a bankruptcy proceeding is
entered against a Limited Partner, the trustee or receiver of his estate or, if he dies, his
executor, administrator or trustee, or, if he is finally adjudicated incompetent, his committee,
guardian or conservator, shall have the rights of such Limited Partner for the purpose of settling
or managing his estate property and such power as the bankrupt, deceased or incompetent Limited
Partner possessed to assign all or any part of his Partnership Interest and to join with the
assignee in satisfying conditions precedent to the admission of the assignee as a Substitute
Limited Partner.



     9.06 JOINT OWNERSHIP OF INTERESTS. A Partnership Interest may be acquired by two
individuals as joint tenants with right of survivorship, provided that such individuals either are
married or are related and share the same home as tenants in common. The written consent or vote of
both owners of any such jointly held Partnership Interest shall be required to constitute the
action of the owners of such Partnership Interest; provided, however, that the written consent of
only one joint owner will be required if the Partnership has been provided with evidence
satisfactory to the counsel for the Partnership that the actions of a single joint owner can bind
both owners under the applicable laws of the state of residence of such joint owners. Upon the
death of one owner of a Partnership Interest held in a joint tenancy with a right of survivorship,
the Partnership Interest shall become owned solely by the survivor as a Limited Partner and not as
an assignee. The Partnership need not recognize the death of one of the owners of a jointly-held
Partnership Interest until it shall have received notice of such death. Upon notice to the General
Partner from either owner, the General Partner shall cause the Partnership Interest to be divided
into two equal Partnership Interests, which shall thereafter be owned separately by each of the
former owners.



ARTICLE X

BOOKS AND RECORDS; ACCOUNTING; TAX MATTERS




     10.01 BOOKS AND RECORDS. At all times during the continuance of the Partnership, the
Partners shall keep or cause to be kept at the Partnership’s specified office true and complete
books of account in accordance with generally accepted accounting principles, including: (a) a
current list of the full name and last known business address of each Partner, (b) a



39









 




copy of the Certificate of Limited Partnership and all certificates of amendment thereto, (c)
copies of the Partnership’s federal, state and local income tax returns and reports, (d) copies of
this Agreement and any financial statements of the Partnership for the three most recent years and
(e) all documents and information required under the Act. Any Partner or its duly authorized
representative, upon paying the costs of collection, duplication and mailing, shall be entitled to
inspect or copy such records during ordinary business hours.




     10.02 CUSTODY OF PARTNERSHIP FUNDS; BANK ACCOUNTS.




     (a) All funds of the Partnership not otherwise invested shall be deposited
in one or more accounts maintained in such banking or brokerage institutions as the General
Partner shall determine, and withdrawals shall be made only on such signature or signatures
as the General Partner may, from time to time, determine.




     (b) All deposits and other funds not needed in the operation of the business
of the Partnership may be invested by the General Partner in investment grade instruments
(or investment companies whose portfolio consists primarily thereof), government
obligations, certificates of deposit, bankers’ acceptances and municipal notes and bonds.
The funds of the Partnership shall not be commingled with the funds of any other Person
except for such commingling as may necessarily result from an investment in those
investment companies permitted by this Section 10.02(b).



     10.03 FISCAL AND TAXABLE YEAR. The fiscal and taxable year of the Partnership shall
be the calendar year.



     10.04 ANNUAL TAX INFORMATION AND REPORT. Within 75 days after the end of each fiscal
year of the Partnership, the General Partner shall furnish to each person who was a Limited Partner
at any time during such year the tax information necessary to file such Limited Partner’s
individual tax returns as shall be reasonably required by law.



     10.05 TAX MATTERS PARTNER; TAX ELECTIONS; SPECIAL BASIS ADJUSTMENTS.




     (a) The General Partner shall be the Tax Matters Partner of the Partnership
within the meaning of Section 6231(a)(7) of the Code. As Tax Matters Partner, the General
Partner shall have the right and obligation to take all actions authorized and required,
respectively, by the Code for the Tax Matters Partner. The General Partner shall have the
right to retain professional assistance in respect of any audit of the Partnership by the
Service and all out-of-pocket expenses and fees incurred by the General Partner on behalf
of the Partnership as Tax Matters Partner shall constitute Partnership expenses. In the
event the General Partner receives notice of a final Partnership adjustment under Section
6223(a)(2) of the Code, the General Partner shall either (i) file a court petition for
judicial review of such final adjustment within the period provided under Section 6226(a)
of the Code, a copy of which petition shall be mailed to all Limited Partners on the date
such petition is filed, or (ii) mail a written notice to all Limited Partners, within such
period, that describes the General Partner’s reasons for determining not to file such a
petition.




     (b) All elections required or permitted to be made by the Partnership under
the Code or any applicable state or local tax law shall be made by the General Partner in
its sole and absolute discretion.



40









 






     (c) In the event of a transfer of all or any part of the Partnership
Interest of any Partner, the Partnership, at the option of the General Partner, may elect
pursuant to Section 754 of the Code to adjust the basis of the Properties. Notwithstanding
anything contained in Article V of this Agreement, any adjustments made pursuant to Section
754 shall affect only the successor in interest to the transferring Partner and in no event
shall be taken into account in establishing, maintaining or computing Capital Accounts for
the other Partners for any purpose under this Agreement. Each Partner will furnish the
Partnership with all information necessary to give effect to such election.



     10.06 REPORTS TO LIMITED PARTNERS.




     (a) If the Company is required to furnish an annual report to its
stockholders containing financial statements of the Company , the Company will, at the same
time and in the same manner, furnish such annual report to each Limited Partner (other than
a Partner whose only Partnership Interests are LTIP Units). The annual financial statements
shall be audited by accountants selected by the Company.




     (b) Any Partner (other than a Partner whose only Partnership Interests are
LTIP Units) shall further have the right to a private audit of the books and records of the
Partnership, provided such audit is made for Partnership purposes, at the expense of the
Partner desiring it and is made during normal business hours.



ARTICLE XI

AMENDMENT OF AGREEMENT; MERGER



The General Partner’s consent shall be required for any amendment to this Agreement. The General
Partner, without the consent of the Limited Partners, may amend this Agreement in any respect;
provided, however, that the following amendments shall require the consent of Limited Partners
(other than the Company or any Subsidiary of the Company) holding more than 50% of the Percentage
Interests of the Limited Partners (other than those held by the Company or any Subsidiary of the
Company):





     (a) any amendment affecting the operation of the Conversion Factor or the
Redemption Right (except as otherwise provided herein) in a manner adverse to the Limited
Partners;




     (b) any amendment that would adversely affect the rights of the Limited
Partners to receive the distributions payable to them hereunder, other than with respect to
the issuance of additional Partnership Units pursuant to Section 4.02 hereof;




     (c) any amendment that would alter the Partnership’s allocations of Profit
and Loss to the Limited Partners, other than with respect to the issuance of additional
Partnership Units pursuant to Section 4.02 hereof;




     (d) any amendment that would impose on the Limited Partners any obligation
to make additional Capital Contributions to the Partnership; or




     (e) any amendment to this Article XI.



41









 




The General Partner, without the consent of the Limited Partners, may (i) merge or consolidate the
Partnership with or into any other domestic or foreign partnership, limited partnership, limited
liability company or corporation in a transaction pursuant to Section 7.01(c) and (d) hereof, or
(ii) sell any, all or substantially all of the assets of the Partnership and may amend this
Agreement in connection with any such transaction.




ARTICLE XII

GENERAL PROVISIONS




     12.01 NOTICES. All communications required or permitted under this Agreement shall
be in writing and shall be deemed to have been given when delivered personally or upon deposit in
the United States mail, registered, postage prepaid return receipt requested, to the Partners at
the addresses set forth in Exhibit A attached hereto; provided, however, that any Partner may
specify a different address by notifying the General Partner in writing of such different address.
Notices to the Partnership shall be delivered at or mailed to its specified office.



     12.02 SURVIVAL OF RIGHTS. Subject to the provisions hereof limiting transfers, this
Agreement shall be binding upon and inure to the benefit of the Partners and the Partnership and
their respective legal representatives, successors, transferees and assigns.



     12.03 ADDITIONAL DOCUMENTS. Each Partner agrees to perform all further acts and
execute, swear to, acknowledge and deliver all further documents that may be reasonable, necessary,
appropriate or desirable to carry out the provisions of this Agreement or the Act.



     12.04 SEVERABILITY. If any provision of this Agreement shall be declared illegal,
invalid or unenforceable in any jurisdiction, then such provision shall be deemed to be severable
from this Agreement (to the extent permitted by law) and in any event such illegality, invalidity
or unenforceability shall not affect the remainder hereof.



     12.05 ENTIRE AGREEMENT. This Agreement and exhibits attached hereto constitute the
entire Agreement of the Partners and supersede all prior written agreements and prior and
contemporaneous oral agreements, understandings and negotiations with respect to the subject matter
hereof.



     12.06 PRONOUNS AND PLURALS. When the context in which words are used in the
Agreement indicates that such is the intent, words in the singular number shall include the plural
and the masculine gender shall include the neuter or female gender as the context may require.



     12.07 HEADINGS. The Article headings or sections in this Agreement are for
convenience only and shall not be used in construing the scope of this Agreement or any particular
Article.



     12.08 COUNTERPARTS. This Agreement may be executed in several counterparts, each of
which shall be deemed to be an original copy and all of which together shall constitute one and the
same instrument binding on all parties hereto, notwithstanding that all parties shall not have
signed the same counterpart.



     12.09 GOVERNING LAW. This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware.




42










 




IN WITNESS WHEREOF, the parties hereto have hereunder affixed their signatures to this Amended and
Restated Agreement of Limited Partnership, all as of the date first above written.




	 	 	 	 	 	 	 	 	 	 	 
	PARTNERSHIP:	 	 	 	 	 	 	 	 
	MPT OPERATING PARTNERSHIP, L.P.	 	 
	 
	BY: 	MEDICAL PROPERTIES TRUST, LLC,  	 	 
	 	 	ITS GENERAL PARTNER	 	 
	 
	 	 	BY:	 	MEDICAL PROPERTIES TRUST, INC.	 	 
	 	 	 	 	ITS: SOLE MEMBER	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	BY:	 	/s/  Edward K. Aldag, Jr.	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Edward K. Aldag, Jr.


Title: President & CEO	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	GENERAL PARTNER:	 	 	 	 	 	 
	MEDICAL PROPERTIES TRUST, LLC	 	 	 	 
	BY: 	MEDICAL PROPERTIES TRUST, INC.	 	 	 	 
	 	 	ITS: SOLE MEMBER	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	BY:	 	/s/  Edward K. Aldag, Jr.	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name: Edward K. Aldag, Jr.	 	 
	 	 	 	 	Title: President & CEO	 	 
	 
	LIMITED PARTNERS:	 	 	 	 	 	 
	MEDICAL PROPERTIES TRUST, INC.	 	 	 	 
	 
	 

	 	BY:	 	/s/  Edward K. Aldag, Jr.	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name: Edward K. Aldag, Jr.	 	 
	 	 	 	 	Title: President & CEO	 	 






43









 





EXHIBIT A




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Agreed Value of	 	Number of	 	 
	 	 	Cash	 	Capital	 	Partnership	 	Percentage
	Partner	 	Contribution	 	Contribution	 	Units	 	Interest
	GENERAL PARTNER
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Medical Properties,
LLC A Delaware
limited company
	 	$	16.30	 	 	$	16.30	 	 	 	16,304.35	 	 	 	1	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	LIMITED PARTNERS
	 	$	1,614.14	 	 	$	1,614.14	 	 	 	1,614,130.65	 	 	 	99	%
	Medical Properties
Trust, Inc.
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	TOTALS:
	 	$	1,630.44	 	 	$	1,630.44	 	 	 	1,630,435	 	 	$	100	%






1









 






Exhibit A-1




2









 








EXHIBIT B




NOTICE OF EXERCISE OF REDEMPTION RIGHT



In accordance with Section 8.04 of the First Amended and Restated Agreement of Limited Partnership
(the “Agreement”) of MPT Operating Partnership, L.P., the undersigned hereby irrevocably (i)
presents for redemption _________ Partnership Units in MPT Operating Partnership, L.P. in accordance
with the terms of the Agreement and the Redemption Right referred to in Section 8.04 thereof, (ii)
surrenders such Partnership Units and all right, title and interest therein and (iii) directs that
the Cash Amount or REIT Shares Amount (as defined in the Agreement) as determined by the General
Partner and the Company deliverable upon exercise of the Redemption Right be delivered to the
address specified below, and if REIT Shares (as defined in the Agreement) are to be delivered, such
REIT Shares be registered or placed in the name(s) and at the address(es) specified below.




Dated:                              
          ,                     




Name of Limited Partner:




                                        




(Signature of Limited Partner)




                                        




(Mailing Address)




                                        




(City) (State) (Zip Code)




Signature Guaranteed by:




                                        




If REIT Shares are to be issued, issue to:




Please insert social security or identifying number:




Name:




Exhibit B-1




3









 








EXHIBIT C



For Redeeming Limited Partners that are entities:




CERTIFICATION OF NON-FOREIGN STATUS



Under section 1445(e) of the Internal Revenue Code of 1986, as amended (the “Code”), in the event
of a disposition by a non-U.S. person of a partnership interest in a partnership in which (i) 50%
or more of the value of the gross assets consists of United States real property interests
(“USRPIs”), as defined in section 897(c) of the Code, and (ii) 90% or more of the value of the
gross assets consists of USRPIs, cash, and cash equivalents, the transferee will be required to
withhold 10% of the amount realized by the non-U.S. person upon the disposition. For purposes of
section 1445 of the Code, the owner of an entity that is treated as disregarded as separate from
such owner under U.S. Treasury regulation section 301.7701-3 and not the disregarded entity will be
treated as the transferor of the partnership interest. To inform Medical Properties Trust, Inc.
(the “Company”) and MPT Operating Partnership, L.P. (the “Partnership”) that no withholding is
required with respect to the redemption by
                                         (“Partner”) of its units of partnership
interest in the Partnership, the undersigned hereby certifies the following on behalf of Partner:



1. Partner is not a foreign corporation, foreign partnership, foreign trust, or foreign estate, as
those terms are defined in the Code and the Treasury regulations thereunder.



2. Partner is not a disregarded entity as defined in Treasury regulation section
1.1445-2(b)(2)(iii).



3. The U.S. employer identification number of Partner is                                         .



4. The principal business address of Partner is:



                                                            

                                                                                  and Partner’s place of incorporation is                                                              .



5. Partner agrees to inform the Company if it becomes a foreign person at any time during the
three-year period immediately following the date of this notice.



6. Partner understands that this certification may be disclosed to the Internal Revenue Service by
the Company and that any false statement contained herein could be punished by fine, imprisonment,
or both.




PARTNER




By:




Name:

Its:




4









 




Under penalties of perjury, I declare that I have examined this certification and, to the best of
my knowledge and belief, it is true, correct, and complete, and I further declare that I have
authority to sign this document on behalf of Partner.




Date: [NAME]




5









 





Title




Exhibit C-1




For Redeeming Limited Partners that are individuals:




CERTIFICATION OF NON-FOREIGN STATUS



Under section 1445(e) of the Internal Revenue Code of 1986, as amended (the “Code”), in the event
of a disposition by a non-U.S. person of a partnership interest in a partnership in which (i) 50%
or more of the value of the gross assets consists of United States real property interests
(“USRPIs”), as defined in section 897(c) of the Code, and (ii) 90% or more of the value of the
gross assets consists of USRPIs, cash, and cash equivalents, the transferee will be required to
withhold 10% of the amount realized by the non-U.S. person upon the disposition. To inform Medical
Properties Trust, Inc. (the “Company”) and MPT Operating Partnership, L.P. (the “Partnership”) that
no withholding is required with respect to my redemption of my units of partnership interest in the
Partnership, I,                      , hereby certify the following:



1. I am not a nonresident alien for purposes of U.S. income taxation.



2. My U.S. taxpayer identification number (social security number) is                                         .



3. My home address is:                                                                                .



4. I agree to inform the Company promptly if I become a nonresident alien at any time during the
three-year period immediately following the date of this notice.



5. I understand that this certification may be disclosed to the Internal Revenue Service by the
Company and that any false statement contained herein could be punished by fine, imprisonment, or
both.



                                                            



Name:



Under penalties of perjury, I declare that I have examined this certification and, to the best of
my knowledge and belief, it is true, correct, and complete.




	 	 	 	 	 	 	 	 	 
	Date:
	 	 	 	 	 	 	 	 
	 

	 	 

	 	
	 	Name:

	 	 






Exhibit C-2




6









 





Exhibit D

LTIP Units



The following are the terms of the LTIP Units:





	1.1	 	Designation. A class of Partnership Units in the Partnership designated as the “LTIP
Units” is hereby established. LTIP Units are intended to qualify as “profits interests” in
the Partnership. The number of LTIP Units that may be issued shall not be limited.






	1.2	 	Vesting. LTIP Units may, in the sole discretion of the General Partner, be issued
subject to vesting, forfeiture and additional restrictions on transfer pursuant to the terms
of an award, vesting or other similar agreement (a “Vesting Agreement”). The terms of
any Vesting Agreement may be modified by the General Partner from time to time in its sole
discretion, subject to any restrictions on amendment imposed by the relevant Vesting Agreement
or by the terms of any plan pursuant to which the LTIP Units are issued, if applicable. LTIP
Units that have vested and are no longer subject to forfeiture under the terms of a Vesting
Agreement are referred to as “Vested LTIP Units”; all other LTIP Units are referred to
as “Unvested LTIP Units.” Subject to the terms of any Vesting Agreement, a holder of
LTIP Units shall be entitled to transfer his or her LTIP Units to the same extent, and subject
to the same restrictions as holders of Common Units are entitled to transfer their Common
Units pursuant to Article IX of the Agreement.






	1.3	 	Forfeiture or Transfer of Unvested LTIP Units. Unless otherwise specified in the
relevant Vesting Agreement, upon the occurrence of any event specified in a Vesting Agreement
as resulting in either the forfeiture of any LTIP Units, or the repurchase by the Partnership
or the General Partner of LTIP Units at a specified purchase price, then, upon the occurrence
of the circumstances resulting in such forfeiture or repurchase by the Partnership or the
General Partner, the relevant LTIP Units shall immediately, and without any further action, be
treated as cancelled and no longer outstanding for any purpose, or as transferred to the
Partnership or General Partner, as applicable. Unless otherwise specified in the Vesting
Agreement, no consideration or other payment shall be due with respect to any LTIP Units that
have been forfeited, other than any distributions declared with a record date prior to the
effective date of the forfeiture. In connection with any forfeiture or repurchase of LTIP
Units, the balance of the portion of the Capital Account of the holder that is attributable to
all of his or her LTIP Units shall be reduced by the amount, if any, by which it exceeds the
target balance contemplated by Section 5.01(j) of the Agreement, calculated with respect to
the holder’s remaining LTIP Units, if any.






	1.4	 	Legend. Any certificate evidencing an LTIP Unit shall bear an appropriate legend
indicating that additional terms, conditions and restrictions on transfer, including without
limitation any Vesting Agreement, apply to the LTIP Unit.




7









 











1.5 Distributions.




	(a)	 	LTIP Distribution Amount. Commencing from and after the LTIP
Unit Distribution Participation Date established for any LTIP Units, such LTIP
Units shall be entitled to receive, if, when and as authorized by the General
Partner out of funds or other property legally available for the payment of
distributions, regular, special, extraordinary or other distributions (other than
distributions representing proceeds of a sale or other disposition of all or
substantially all of the assets of the Partnership) that may be made from time to
time, in an amount per unit equal to the amount of any such distributions that
would have been payable to such holders if the LTIP Units had been Common Units
(unless otherwise specified in the Vesting Agreement or other documentation
pursuant to which the LTIP Units are issued (e.g., in the case of a Special LTIP
Unit)). LTIP Units shall also be entitled to receive, if, when and as authorized
by the General Partner out of funds or other property legally available for the
payment of distributions, distributions representing proceeds of a sale or other
disposition of all or substantially all of the assets of the Partnership in an
amount per unit equal to the amount of any such distributions payable on the
Common Units, whether made prior to, on or after the LTIP Unit Distribution
Participation Date; provided that the amount of such distributions shall
not exceed the positive balances of the Capital Accounts of the holders of such
LTIP Units to the extent attributable to the ownership of such LTIP Units.
Distributions on the LTIP Units, if authorized, shall be payable on such dates and
in such manner as may be authorized by the General Partner (any such date, a
“LTIP Unit Distribution Payment Date”); provided that the LTIP Unit
Distribution Payment Date shall be the same as the corresponding date relating to
the corresponding distribution on the Common Units. The record date for
determining which holders of LTIP Units are entitled to receive a distribution
shall be the Partnership Record Date for that distribution. All distributions
paid with respect to LTIP Units prior to the date on which the determination is
made with respect to events resulting in the forfeiture of such LTIP Units or the
repurchase by the Partnership or the General Partner of such LTIP Units shall be
retained by the holder of such LTIP Units and not subject to forfeiture or
restitution in the event that Unvested LTIP Units fail to become Vested LTIP
Units. Following such date of determination, no further distributions will be
paid with respect to Unvested LTIP Units that have been forfeited or are
repurchased by the Partnership or the General Partner, other than any
distributions declared with a record date prior to the effective date of the
forfeiture or repurchase.






	(b)	 	LTIP Unit Distribution Participation Date. The “LTIP
Unit Distribution Participation Date” for each LTIP Unit will be such date as
may be specified in the Vesting Agreement or other documentation pursuant to which
such LTIP Units are issued.






8










 






	1.6	 	 Allocations. Commencing with the portion of the taxable year of the Partnership
that begins on the LTIP Unit Distribution Participation Date established for any LTIP Units,
such LTIP Units shall be allocated Profits and Losses in amounts per LTIP Unit equal to the
amounts allocated per Common Unit (unless otherwise specified in the Vesting Agreement or
other documentation pursuant to which the LTIP Units are issued (e.g., in the case of a
Special LTIP Unit)). The allocations provided by the preceding sentence shall be subject to
Sections 5.01(a) and (b) and, in addition, to any special allocations required by Sections
5.01(c) and (d), each as provided in the Agreement. The General Partner is authorized in its
discretion to adjust the allocations made under this Section after the LTIP Unit Distribution
Participation Date, so that the ratio of (i) the total amount of Profits or Losses allocated
with respect to each LTIP Unit in the taxable year in which that LTIP Unit’s LTIP Unit
Distribution Participation Date falls (excluding special allocations under Section 5.01(j) and
(k) of the Agreement), to (ii) the total amount distributed to that LTIP Unit with respect to
such period, is more nearly equal to the ratio of (i) the Profits and Losses allocated with
respect to the General Partner’s Common Units in such taxable year to (ii) the amounts
distributed to the General Partner with respect to such Common Units and such taxable year.
Prior to the LTIP Unit Distribution Date, LTIP Units shall be allocated Profits and Losses in
amounts necessary to reflect the LTIP Unit Return Amount.
	 
	1.7	 	Adjustments. The Partnership shall maintain at all times a one-to-one correspondence
between LTIP Units and Common Units for conversion, distribution and other purposes, including
without limitation complying with the following procedures; provided that the foregoing is not
intended to alter the LTIP Unit Capital Account Limitation (as defined below), the special
allocations pursuant to Sections 5.01(i), (j) and (k) of the Agreement, differences between
distributions (other than, with respect to LTIP Units having an LTIP Unit Distribution
Participation Date determined under Section 1.5(b) above, distributions representing proceeds
of a sale or other disposition of all or substantially all of the assets of the Partnership)
to be made with respect to the LTIP Units and Common Units prior to the LTIP Unit Distribution
Participation Date for such LTIP Units, differences between distributions (other than, with
respect to LTIP Units having an LTIP Unit Distribution Participation Date determined under
Section 1.5(b) above, distributions representing proceeds of a sale or other disposition of
all or substantially all of the assets of the Partnership) to be made with respect to the LTIP
Units and Common Units pursuant to Section 5.06 of the Agreement or Section 1.5(a) hereof in
the event that the Capital Accounts attributable to the LTIP Units are less than those
attributable to the Common Units due to insufficient special allocations pursuant to Section
5.01(j) of the Agreement or related provisions. If an LTIP Unit Adjustment Event (as defined
below) occurs, then the General Partner shall make a corresponding adjustment to the LTIP
Units to maintain such one-for-one correspondence between Common Units and LTIP Units. The
following shall be “LTIP Unit Adjustment Events”: (A) the Partnership makes a
distribution on all outstanding Common Units in Partnership Units, (B) the Partnership
subdivides the




9









 






	 	 	outstanding Common Units into a greater number of units or combines the outstanding Common
Units into a smaller number of units, or (C) the Partnership issues any Partnership Units in
exchange for its outstanding Common Units by way of a reclassification or recapitalization
of its Common Units. If more than one LTIP Unit Adjustment Event occurs, the adjustment to
the LTIP Units need be made only once using a single formula that takes into account each
and every LTIP Unit Adjustment Event as if all LTIP Unit Adjustment Events occurred
simultaneously. For the avoidance of doubt, the following shall not be LTIP Unit Adjustment
Events: (x) the issuance of Partnership Units in a financing, reorganization, acquisition or
other similar business transaction, (y) the issuance of Partnership Units pursuant to any
employee benefit or compensation plan or distribution reinvestment plan, or (z) the issuance
of any Partnership Units to the General Partner in respect of a Capital Contribution to the
Partnership of proceeds from the sale of securities by the General Partner. If the
Partnership takes an action affecting the Common Units other than actions specifically
described above as LTIP Unit Adjustment Events and in the opinion of the General Partner
such action would require an adjustment to the LTIP Units to maintain the one-to-one
correspondence described above, the General Partner shall make such adjustment to the LTIP
Units, to the extent permitted by law and by the terms of any plan pursuant to which the
LTIP Units have been issued, in such manner and at such time as the General Partner, in its
sole discretion, may determine to be appropriate under the circumstances. If an adjustment
is made to the LTIP Units as herein provided, the Partnership shall promptly file in the
books and records of the Partnership an officer’s certificate setting forth such adjustment
and a brief statement of the facts requiring such adjustment, which certificate shall be
conclusive evidence of the correctness of such adjustment absent manifest error. Promptly
after filing of such certificate, the Partnership shall mail a notice to each holder of LTIP
Units setting forth the adjustment to his or her LTIP Units and the effective date of such
adjustment.
	 
	1.8	 	Ranking. The LTIP Units shall rank on parity with the Common Units in all respects.
	 
	1.9	 	Right to Convert LTIP Units into Common Units.






	 	(a)	 	Conversion Right. A holder of LTIP Units shall have the right (the
“LTIP Unit Conversion Right”), at his or her option, at any time to convert
all or a portion of his or her Vested LTIP Units into Common Units. Holders of LTIP
Units shall not have the right to convert Unvested LTIP Units into Common Units until
they become Vested LTIP Units; provided, however, that when a holder
of LTIP Units is notified of the expected occurrence of an event that will cause his
or her Unvested LTIP Units to become Vested LTIP Units, such Person may give the
Partnership an LTIP Unit Conversion Notice conditioned upon and effective as of the
time of vesting, and such LTIP Unit Conversion Notice, unless subsequently revoked by
the holder of the LTIP Units, shall be accepted by the Partnership subject to such




10









 






	 	 	 	condition. The General Partner shall have the right at any time to cause a
conversion of Vested LTIP Units into Common Units. In all cases, the
conversion of any LTIP Units into Common Units shall be subject to the
conditions and procedures set forth in this Section 1.9.






	 	(b)	 	Number of Units Convertible. A holder of Vested LTIP Units may
convert such Vested LTIP Units into an equal number of fully paid and non-assessable
Common Units, giving effect to all adjustments (if any) made pursuant to Section 1.7.
Notwithstanding the foregoing, in no event may a holder of Vested LTIP Units convert a
number of Vested LTIP Units that exceeds (x) the Economic Capital Account Balance of
such holder, to the extent attributable to its ownership of LTIP Units, divided by (y)
the Common Unit Economic Balance, in each case as determined as of the effective date
of conversion (the “LTIP Unit Capital Account Limitation”).
	 
	 	(c)	 	Notice. In order to exercise his or her Conversion Right, a holder
of LTIP Units shall deliver a notice (a “LTIP Unit Conversion Notice”) in the
form attached as Exhibit E to the Agreement not less than 10 nor more than 60
days prior to a date (the “LTIP Unit Conversion Date”) specified in such LTIP
Unit Conversion Notice. Each holder of LTIP Units covenants and agrees with the
Partnership that all Vested LTIP Units to be converted pursuant to this Section 1.9
shall be free and clear of all liens. Notwithstanding anything herein to the contrary
(but subject to Article VIII of the Agreement), a holder of LTIP Units may deliver a
Notice of Redemption Notice pursuant to Section 8.04(b) of the Agreement relating to
those Common Units that will be issued to such holder upon conversion of such LTIP
Units into Common Units in advance of the LTIP Unit Conversion Date; provided,
however, that the redemption of such Common Units by the Partnership shall in no event
take place until the LTIP Unit Conversion Date. For clarity, it is noted that the
objective of this paragraph is to put a holder of LTIP Units in a position where, if
he or she so wishes, the Common Units into which his or her Vested LTIP Units will be
converted can be redeemed by the Partnership simultaneously with such conversion, with
the further consequence that, if the General Partner elects to assume the
Partnership’s redemption obligation with respect to such Common Units under Article
VIII of the Agreement by delivering to such holder REIT Shares rather than cash, then
such holder can have such REIT Shares issued to him or her simultaneously with the
conversion of his or her Vested LTIP Units into Common Units. The General Partner
shall cooperate with a holder of LTIP Units to coordinate the timing of the different
events described in the foregoing sentence.






	1.10	 	Forced Conversion. The Partnership, at any time at the election of the General
Partner, may cause any number of Vested LTIP Units held by a holder of LTIP




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Units to be converted (a “LTIP Unit Forced Conversion”) into an equal number of
Common Units, giving effect to all adjustments (if any) made pursuant to Section 1.7;
provided, that the Partnership may not cause an LTIP Unit Forced Conversion of any
LTIP Units that would not at the time be eligible for conversion at the option of the holder
of such LTIP Units pursuant to Section 1.9. above (including taking into account the LTIP
Unit Capital Account Limitation). In order to exercise its right to cause an LTIP Unit
Forced Conversion, the Partnership shall deliver a notice (a “LTIP Unit Forced
Conversion Notice”) in the form attached as Exhibit F to the Agreement to the
applicable holder not less than 10 nor more than 60 days prior to the LTIP Unit Conversion
Date specified in such LTIP Unit Forced Conversion Notice. A Forced LTIP Unit Conversion
Notice shall be provided in the manner provided in Section 12.01 of the Agreement.




	1.11	 	Conversion Procedures. Subject to any redemption of Common Units to be received upon
the conversion of Vested LTIP Units, a conversion of Vested LTIP Units for which the holder
thereof has given an LTIP Unit Conversion Notice or the Partnership has given a Forced LTIP
Unit Conversion Notice shall occur automatically after the close of business on the applicable
LTIP Unit Conversion Date without any action on the part of such holder of LTIP Units, as of
which time such holder of LTIP Units shall be credited on the books and records of the
Partnership with the issuance as of the opening of business on the next day of the number of
Common Units issuable upon such conversion. After the conversion of LTIP Units as aforesaid,
the Partnership shall deliver to such holder of LTIP Units, upon his or her written request, a
certificate of the General Partner certifying the number of Common Units and remaining LTIP
Units, if any, held by such Person immediately after such conversion.
	 
	1.12	 	Treatment of Capital Account. For purposes of making future allocations under
Section 5.01(j) of the Agreement and applying the LTIP Unit Capital Account Limitation, the
portion of the Economic Capital Account Balance of the applicable holder of LTIP Units that is
treated as attributable to his or her LTIP Units shall be reduced, as of the date of
conversion, by the product of the number of LTIP Units converted and the Common Unit Economic
Balance.
	 
	1.13	 	Mandatory Conversion in Connection with a Transaction.






(a) If the Partnership or the General Partner shall be a party to any transaction (including
without limitation a merger, consolidation, unit exchange, self tender offer for all or
substantially all Common Units or other business combination or reorganization, or sale of
all or substantially all of the Partnership’s assets, but excluding any transaction which
constitutes an LTIP Unit Adjustment Event), in each case as a result of which Common Units
shall be exchanged for or converted into the right, or the holders of Common Units shall
otherwise be entitled, to receive cash, securities or other property or any combination
thereof (each of the foregoing being referred to herein as a “Transaction”), then the
General Partner shall, immediately prior to the Transaction, exercise its right to cause a
LTIP Unit Forced Conversion with respect to the maximum number of LTIP Units then



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eligible for conversion, taking into account any allocations that occur in connection with
the Transaction or that would occur in connection with the Transaction if the assets of the
Partnership were sold at the Transaction price or, if applicable, at a value determined by
the General Partner in good faith using the value attributed to the Partnership Units in the
context of the Transaction (in which case the LTIP Unit Conversion Date shall be the
effective date of the Transaction and the conversion shall occur immediately prior to the
effectiveness of the Transaction).




(b) In anticipation of such LTIP Unit Forced Conversion and the consummation of the
Transaction, the Partnership shall use commercially reasonable efforts to cause each holder
of LTIP Units to be afforded the right to receive in connection with such Transaction in
consideration for the Common Units into which his or her LTIP Units will be converted the
same kind and amount of cash, securities and other property (or any combination thereof)
receivable upon the consummation of such Transaction by a holder of the same number of Common
Units, assuming such holder of Common Units is not a Person with which the Partnership
consolidated or into which the Partnership merged or which merged into the Partnership or to
which such sale or transfer was made, as the case may be (a “Constituent Person”), or
an Affiliate of a Constituent Person. In the event that holders of Common Units have the
opportunity to elect the form or type of consideration to be received upon consummation of
the Transaction, prior to such Transaction the General Partner shall give prompt written
notice to each holder of LTIP Units of such election, and shall use commercially reasonable
efforts to afford such holders the right to elect, by written notice to the General Partner,
the form or type of consideration to be received upon conversion of each LTIP Unit held by
such holder into Common Units in connection with such Transaction. If a holder of LTIP Units
fails to make such an election, such holder (and any of its transferees) shall receive upon
conversion of each LTIP Unit held by him or her (or by any of his or her transferees) the
same kind and amount of consideration that a holder of a Common Unit would receive if such
holder of Common Units failed to make such an election.




(c) Subject to the rights of the Partnership and the General Partner under any Vesting
Agreement and the terms of any plan under which LTIP Units are issued, the Partnership shall
use commercially reasonable efforts to cause the terms of any Transaction to be consistent
with the provisions of this Section 1.13 and to enter into an agreement with the successor or
purchasing entity, as the case may be, for the benefit of any holders of LTIP Units whose
LTIP Units will not be converted into Common Units in connection with the Transaction that
will (i) contain provisions enabling the holders of LTIP Units that remain outstanding after
such Transaction to convert their LTIP Units into securities as comparable as reasonably
possible under the circumstances to the Common Units and (ii) preserve as far as reasonably
possible under the circumstances the distribution, special allocation, conversion, and other
rights set forth in the Agreement for the benefit of the holders of LTIP Units.



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	1.14	 	Redemption at the Option of the Partnership. LTIP Units will not be redeemable at
the option of the Partnership; provided, however, that the foregoing shall not
prohibit the Partnership from (i) repurchasing LTIP Units from the holder thereof if and to
the extent such holder agrees to sell such LTIP Units or (ii) from exercising its LTIP Unit
Forced Conversion right.
	 
	1.15	 	Voting Rights. Voting with Common Units. Holders of LTIP Units shall have
the right to vote on all matters submitted to a vote of the holders of Common Units; holders
of LTIP Units and Common Units shall vote together as a single class, together with any other
class or series of Partnership Units upon which like voting rights have been conferred. In
any matter in which the LTIP Units are entitled to vote, including an action by written
consent, each LTIP Unit shall be entitled to vote a Percentage Interest equal on a per unit
basis to the Percentage Interest represented by each Common Unit.
	 
	1.16	 	Special Approval Rights. Except as provided in Section 1.15 above, holders of LTIP
Units shall only (a) have those voting rights required from time to time by non-waivable
provisions of applicable law, if any, and (b) have the additional voting rights that are
expressly set forth in this Section 1.16. The General Partner and/or the Partnership shall
not, without the affirmative vote of holders of more than 50% of the then outstanding LTIP
Units affected thereby, given in person or by proxy, either in writing or at a meeting (voting
separately as a class), take any action that would materially and adversely alter, change,
modify or amend, whether by merger, consolidation or otherwise, the rights, powers or
privileges of such LTIP Units, subject to the following exceptions: (i) no separate consent of
the holders of LTIP Units will be required if and to the extent that any such alteration,
change, modification or amendment would equally, ratably and proportionately alter, change,
modify or amend the rights, powers or privileges of the Common Units (in which event the
holders of LTIP Units shall only have such voting rights, if any, as expressly provided for in
the Agreement, in accordance with Section 1.15 above); (ii) with respect to any merger,
consolidation or other business combination or reorganization, so long as either (w) the LTIP
Units are converted into Common Units immediately prior to the effectiveness of the
transaction, (x) the holders of LTIP Units either will receive, or will have the right to
elect to receive, for each LTIP Unit an amount of cash, securities, or other property equal to
the greatest amount of cash, securities or other property paid to a holder of one Common Unit
in consideration of one Common Unit pursuant to the terms of such
transaction, (y)
the LTIP Units remain outstanding with the terms thereof materially unchanged, or (z) if the
Partnership is not the surviving entity in such transaction, the LTIP Units are exchanged for
a security of the surviving entity with terms that are materially the same with respect to
rights to allocations, distributions, redemption, conversion and voting as the LTIP Units and
without any income, gain or loss expected to be recognized by the holder upon the exchange for
federal income tax purposes (and with the terms of the Common Units or such other securities
into which the LTIP Units (or the substitute security therefor) are convertible materially the
same with respect to rights to allocations, distributions, redemption, conversion and voting),
such merger, consolidation or




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	 	 	other business combination or reorganization shall not be deemed to materially and adversely
alter, change, modify or amend the rights, powers or privileges of the LTIP Units, provided
further, that if some, but not all, of the LTIP Units are converted into Common Units
immediately prior to the effectiveness of the transaction (and neither clause (y) or (z)
above is applicable), then the consent required pursuant to this Section will be the consent
of the holders of more than 50% of the LTIP Units to be outstanding following such
conversion;(iii) any creation or issuance of Partnership Units (whether ranking junior to,
on a parity with or senior to the LTIP Units with respect to payment of distributions, right
of redemptions and the distribution of assets upon liquidation, dissolution or winding up),
which either (x) does not require the consent of the holders of Common Units or (y) does
require such consent and is authorized by a vote of the holders of Common Units and LTIP
Units voting together as a single class pursuant to Section 1.15 above, together with any
other class or series of units of limited partnership interest in the Partnership upon which
like voting rights have been conferred, shall not be deemed to materially and adversely
alter, change, modify or amend the rights, powers or privileges of the LTIP Units; and (iv)
any waiver by the Partnership of restrictions or limitations applicable to any outstanding
LTIP Units with respect to any holder or holders thereof shall not be deemed to materially
and adversely alter, change, modify or amend the rights, powers or privileges of the LTIP
Units with respect to other holders.




The foregoing voting provisions will not apply if, as of or prior to the time when the action with
respect to which such vote would otherwise be required will be taken or be effective, all
outstanding LTIP Units shall have been converted and/or redeemed, or provision is made for such
redemption and/or conversion to occur as of or prior to such time.




[End of text]




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EXHIBIT E




NOTICE OF ELECTION BY PARTNER TO CONVERT

LTIP UNITS INTO COMMON UNITS




     The undersigned holder of LTIP Units hereby irrevocably elects to convert the number of Vested
LTIP Units in MPT Operating Partnership, L.P. (the “Partnership”) set forth below into
Common Units in accordance with the terms of the Second Amended and Restated Agreement of Limited
Partnership of the Partnership, as amended. The undersigned hereby represents, warrants, and
certifies that the undersigned: (a) has title to such LTIP Units, free and clear of the rights or
interests of any other person or entity other than the Partnership; (b) has the full right, power,
and authority to cause the conversion of such LTIP Units as provided herein; and (c) has obtained
the consent or approval of all persons or entities, if any, having the right to consent or approve
such conversion.



	 	 	 
	Name of Holder:
	 	 
	 

	 	 
	 

	 	(Please Print: Exact Name as Registered with Partnership)






Number of LTIP Units to be Converted:                                                             




Conversion Date:                                                             




	 	 	 	 	 	 	 
	 	 	 
	 	 	(Signature of Holder: Sign Exact Name as Registered with Partnership)
	 
	 	 	 	 	 	 
	 	 	 
	 	 	(Street Address)
	 
	 	 	 	 	 	 
	 	 	 
	 

	 	(City)
	 	(State)
	 	(Zip Code)
	 
	 	 	Signature Guaranteed by:
	 	 	 	 





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EXHIBIT F




NOTICE OF ELECTION BY PARTNERSHIP TO FORCE CONVERSION

OF LTIP UNITS INTO COMMON UNITS




     MPT Operating Partnership, L.P. (the “Partnership”) hereby irrevocably elects to cause
the number of LTIP Units held by the holder of LTIP Units set forth below to be converted into
Common Units in accordance with the terms of the Second Amended and Restated Limited Partnership
Agreement of the Partnership, as amended.



	 	 	 
	Name of Holder:
	 	 
	 

	 	 
	 

	 	(Please Print: Exact Name as Registered with Partnership)






	 	 	 	 	 	 	 
	Number of LTIP Units to be Converted:	 	 	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Conversion Date: 
	 	 	 	 	 	 
	 	 






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