Document:

EX-10.1 AMENDED AGREEMENT OF LIMITED PARTNERSHIP

 

Exhibit 10.1

THIRD AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP OF

COLONIAL REALTY LIMITED PARTNERSHIP

          THIS THIRD AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF COLONIAL REALTY LIMITED
PARTNERSHIP (“Agreement”), dated as of October 19, 1999, is entered into by and among Colonial
Properties Trust, an Alabama real estate investment trust, as the General Partner (“Colonial
Properties” or the “General Partner”), and the Persons whose names are set forth on Exhibit A as
attached hereto who were admitted as limited partners in accordance with the provisions of the
Second Amended and Restated Agreement of Limited Partnership, dated as of October 27, 1994, and the
First Amended and Restated Agreement of Limited Partnership, dated as of September 29, 1993
(collectively, the “Prior Agreements”), as the Limited Partners, together with any other Persons
who become Partners in the Partnership as provided herein, for certain limited purposes set forth
in this Agreement.

          In consideration of the mutual covenants set forth herein, and for other good and valuable
consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree to continue the Partnership as a limited partnership under the Delaware Revised
Uniform Limited Partnership Act (6 Del. C. ss. 17-101, et seq.), as amended from time to time (the
“Act”), as follows:

ARTICLE 1

DEFINED TERMS

          The following definitions shall be for all purposes, unless otherwise clearly
indicated to the contrary, applied to the terms used in this Agreement.

          “Act” means the Delaware Revised Uniform Limited Partnership Act, as it may be amended from
time to time, and any successor to such statute.

          “Additional Limited Partner” means a Person admitted to the Partnership as a Limited Partner
pursuant to Section 4.2 hereof and who is shown as such on the books and records of the
Partnership.

          “Adjusted Capital Account” means the Capital Account maintained for each Partner as of the end
of each Partnership Year (i) increased by any amounts which such Partner is obligated to restore
pursuant to any provision of this Agreement or is deemed to be obligated to restore pursuant to the
penultimate sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5) and (ii) decreased
by the items described in Regulations
Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5),
and 1.704-1(b)(2)(ii)(d)(6). The foregoing definition of Adjusted Capital Account is intended to
comply with the provisions of Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted
consistently therewith.

          “Adjusted Capital Account Deficit” means, with respect to any Partner, the deficit balance, if
any, in such Partner’s Adjusted Capital Account as of the end of the relevant Partnership Year.

          “Adjusted Property” means any property the Carrying Value of which has been adjusted pursuant
to Exhibit B hereof. Once an Adjusted Property is deemed distributed by, and recontributed to, the
Partnership for federal income tax purposes upon a termination thereof pursuant to Section 708 of
the Code, such property shall thereafter constitute a Contributed Property
until the Carrying Value of such property is further adjusted pursuant to Exhibit B
hereof.

 

 

          “Affiliate” means, with respect to any Person, (i) any Person directly or indirectly
controlling, controlled by or under common control with such Person, (ii) any Person owning or
controlling ten percent (10%) or more of the outstanding voting interests of such Person, (iii) any
Person of which such Person owns or controls ten percent (10%) or more of the voting interests, or
(iv) any officer, director, general partner or trustee of such Person or of any Person referred to
in clauses (i), (ii), and (iii) above.

          “Agreed Value” means (i) in the case of any Contributed Property set forth in Exhibit D and as
of the time of its contribution to the Partnership, the Agreed Value of such property as set forth
in Exhibit D; (ii) in the case of any Contributed Property not set forth in Exhibit D and as of the
time of its contribution to the Partnership, the 704(c) Value of such property, reduced by any
liabilities either assumed by the Partnership upon such contribution or to which such property is
subject when contributed, and (iii) in the case of any property distributed to a Partner by the
Partnership, the Partnership’s Carrying Value of such property at the time such property is
distributed, reduced by any indebtedness either assumed by such Partner upon such distribution or
to which such property is subject at the time of distribution as determined under Section 752 of
the Code and the Regulations thereunder.

          “Agreement” means this Third Amended and Restated Agreement of Limited Partnership, as it may
be amended, supplemented or restated from time to time.

          “Assignee” means a Person to whom one or more Partnership Units have been transferred in
a manner permitted under this Agreement, but who has not become a Substituted Limited Partner,
and who has the rights set forth in Section 11.5.

          “Available Cash” means, with respect to any period for which such calculation is being made,
(i) the sum of:

     (a) the Partnership’s Net Income or Net Loss (as the case may be) for
such period (without regard to adjustments resulting from allocations
described in Sections 1.A through 1.E of Exhibit C);

     (b) Depreciation and all other noncash charges deducted in determining
Net Income or Net Loss for such period;

     (c) the amount of any reduction in the reserves of the Partnership
referred to in clause (ii) (f) below (including, without limitation,
reductions resulting because the General Partner determines such amounts
are no longer necessary);

     (d) the excess of proceeds from the sale, exchange, disposition, or
refinancing of Partnership property for such period over the gain
recognized from such sale, exchange, disposition, or refinancing during
such period (excluding Terminating Capital Transactions); and

     (e) all other cash received by the Partnership for such period that
was not included in determining Net Income or Net Loss for such period;

 

 

(ii) less the sum of:

     (a) all principal debt payments made by the Partnership during such
period ;

     (b) capital expenditures made by the Partnership during such period;

     (c) investments made by the Partnership during such period in any
entity (including loans made thereto) to the extent that such investments
are not otherwise described in clause (ii) (a) or (ii)(b);

     (d) all other expenditures and payments not deducted in determining Net
Income or Net Loss for such period;

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

     (f) the amount of any increase in reserves during such period which
the General Partner determines to be necessary or appropriate in its sole
and absolute discretion; and

     (g) the amount of any working capital accounts and other cash or
similar balances which the General Partner determines to be necessary or
appropriate, in its sole and absolute discretion.

          Notwithstanding the foregoing, Available Cash shall not include any cash received or
reductions in reserves, or take
into account any disbursements made or reserves established, after commencement of the
dissolution and liquidation of the Partnership.

          “Book-Tax Disparities” means, with respect to any item of Contributed Property or Adjusted
Property, as of the date of any determination, the difference between the Carrying Value of such
Contributed Property or Adjusted Property and the adjusted basis thereof for federal income tax
purposes as of such date. A Partner’s share of the Partnership’s Book-Tax Disparities in all of its
Contributed Property and Adjusted Property will be reflected by the difference between such
Partner’s Capital Account balance as maintained pursuant to Exhibit B and the hypothetical balance
of such Partner’s Capital Account computed as if it had been maintained strictly in accordance with
federal income tax accounting principles.

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

          “Capital Account” means the Capital Account maintained for a Partner pursuant to Exhibit B
hereof.

          “Capital Contribution” means, with respect to any Partner, any cash, cash equivalents or the
Agreed Value of Contributed Property which such Partner contributes or is deemed to contribute to
the Partnership pursuant to Section 4.1, 4.2, or 4.3 hereof.

          “Carrying Value” means (i) with respect to a Contributed Property or Adjusted Property, the
704(c) Value of such property, reduced (but

 

 

not below zero) by all Depreciation with respect to such Property charged to the Partners’ Capital
Accounts following the contribution of or adjustment with respect to such Property, and (ii) with
respect to any other Partnership property, the adjusted basis of such property for federal income
tax purposes, all as of the time of determination. The Carrying Value of any property shall be
adjusted from time to time in accordance with Exhibit B hereof, and to reflect changes, additions
or other adjustments to the Carrying Value for dispositions and acquisitions of Partnership
properties, as deemed appropriate by the General Partner.

          “Cash Amount” means an amount of cash equal to the Value on the Valuation Date of the REIT
Shares Amount.

          “Certificate” means the Certificate of Limited Partnership relating to the Partnership filed
in the office of the Delaware Secretary of State, as amended from time to time in accordance with
the terms hereof and the Act.

          “Class A” means the Partners who are holders of Class A Units.

          “Class A Share” means that portion of Available Cash for a Distribution Period to be
distributed with respect to Class A as determined by multiplying the amount of Available Cash for
such Distribution Period by the fraction set forth in Section 5.1.B.1 hereof.

          “Class A Unit” means any Partnership Unit other than a Class B Unit, a Preferred Unit, or any
other Partnership Unit that is specifically designated by the General Partner pursuant to Section
4.2 as being another class of Partnership Units.

          “Class B” means the Partners who are holders of Class B Units.

          “Class B Share” means that portion of Available Cash for a Distribution Period to be
distributed with respect to Class B as determined by multiplying the amount of Available Cash for
such Distribution Period by the fraction set forth in Section 5.1.B.2 hereof (as such fraction may
be adjusted in accordance with Section 5.1.B hereof).

          “Class B Unit” means a Partnership Unit with such designations, preferences, rights, powers
and duties as are described in or pursuant to Section 4.2.C.

          “Code” means the Internal Revenue Code of 1986, as amended and in effect from time to time, as
interpreted by the applicable regulations thereunder. Any reference herein to a specific section or
sections of the Code shall be deemed to include a reference to any corresponding provision of
future law.

          “Common Unit” means a Partnership Unit that is not a Preferred Unit. The Class A Units and
Class B Units, and any other Partnership Units that may be issued from time to time by the General
Partner as set forth in Section 4.2 and designated as Common Units, are Common Units.

          “Common Unit Available Cash” has the meaning set forth in Section 5.1.B.

          “Consent” means the consent or approval of a proposed action by a Partner given in accordance
with Section 14.2 hereof.

          “Contributed Property” means each property or other asset, in

 

 

such form as may be permitted by the Act, but excluding cash, contributed or deemed contributed to
the Partnership (including deemed contributions to the Partnership on termination and
reconstitution thereof pursuant to Section 708 of the Code). Once the Carrying Value of a
Contributed Property is adjusted pursuant to Exhibit B hereof, such property shall no longer
constitute a Contributed Property for purposes of Exhibit B hereof, but shall be deemed an Adjusted
Property for such purposes.

          “Conversion Factor” means 1.0, provided that in the event that the General Partner (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 purpose 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
assumption) issued and outstanding on the record date for such dividend, distribution, subdivision
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.

          “Debt” means, as to any Person, as of any date of determination, (i) all indebtedness of such
Person for borrowed money or for the deferred purchase price of property or services; (ii) all
amounts owed by such Person to banks or other Persons in respect of reimbursement obligations
under letters of credit, surety bonds and other similar instruments guaranteeing payment or
other performance of obligations by such Person; (iii) all indebtedness for borrowed money or for
the deferred purchase price of property or services secured by any lien on any property owned by
such Person, to the extent attributable to such Person’s interest in such property, even though
such Person has not assumed or become liable for the payment thereof; and (iv) lease obligations of
such Person which, in accordance with generally accepted accounting principles, should be
capitalized.

          “Declaration of Trust” means the Declaration of Trust of the General Partner filed in the
State of Alabama on August 21, 1995, as amended or restated from time to time.

          “Depreciation” means, for each fiscal year an amount equal to the federal income tax
depreciation, amortization, or other cost recovery deduction allowable with respect to an asset for
such year, except that if the Carrying Value of an asset differs from its adjusted basis for
federal income tax purposes at the beginning of such year or other period, Depreciation shall be an
amount which bears the same ratio to such beginning Carrying Value as the federal income tax
depreciation, amortization, or other cost recovery deduction for such year bears to such beginning
adjusted tax basis; provided, however, that if the federal income tax depreciation, amortization,
or other cost recovery deduction for such year is zero, Depreciation shall be determined with
reference to such beginning Carrying Value using any reasonable method selected by the General
Partner.

          “Distribution Period” means any calendar quarter or shorter period with respect to which a
distribution of Available Cash is to be made to the Partners by the Partnership.

          “Effective Date” means the date of closing of the initial public offering of shares of the
General Partner pursuant to that certain agreement

 

 

among the Former General Partner, the Partnership, the General Partner, and Lehman Brothers Inc.,
Bear, Stearns & Co. Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated and The
Robinson-Humphrey Company, Inc. as agents for the underwriters.

          “Exercise Percentage” has the meaning set forth in Section 4.4.

          “Former General Partner” means Colonial Properties Holding Company, Inc., an Alabama
corporation formed by Colonial Properties as a wholly owned subsidiary of Colonial Properties to
serve as the general partner of the Partnership. The separate existence of the Former General
Partner terminated on December 31, 1998, when the Former General Partner merged with and into
Colonial Properties, whereupon Colonial Properties became the General Partner.

          “General Partner” means Colonial Properties Trust, an Alabama real estate investment trust, in
its capacity as the general partner of the Partnership, or its successors as general partner of the
Partnership, and shall also be deemed to refer to, where the context so requires, the Former
General Partner, in its capacity as the predecessor to Colonial Properties.

          “General Partner Interest” means a Partnership Interest held by the General Partner that is a
general partnership interest. A General Partner Interest may be expressed as a number of
Partnership Units.

          “IRS” means the Internal Revenue Service, which administers the internal revenue laws of the
United States.

          “Immediate Family” means, with respect to any natural Person, such natural Person’s spouse and
such natural Person’s natural
or adoptive parents, descendants, nephews, nieces, brothers, and sisters.

          “Incapacity” or “Incapacitated” means, (i) as to any individual Partner, death, total physical
disability or entry by a court of competent jurisdiction adjudicating him incompetent to manage his
Person or his estate; (ii) as to any corporation which is a Partner, the filing of a certificate of
dissolution, or its equivalent, for the corporation or the revocation of its charter; (iii) as to
any partnership which is a Partner, the dissolution and commencement of winding up of the
partnership; (iv) as to any estate which is a Partner, the distribution by the fiduciary of the
estate’s entire interest in the Partnership; (v) as to any trustee of a trust which is a Partner,
the termination of the trust (but not the substitution of a new trustee); or (vi) as to any
Partner, the bankruptcy of such Partner. For purposes of this definition, bankruptcy of a Partner
shall be deemed to have occurred when (a) the Partner commences a voluntary proceeding seeking
liquidation, reorganization or other relief under any bankruptcy, insolvency or other similar law
now or hereafter in effect, (b) the Partner is adjudged as bankrupt or insolvent, or a final and
nonappealable order for relief under any bankruptcy, insolvency or similar law now or hereafter in
effect has been entered against the Partner, (c) the Partner executes and delivers a general
assignment for the benefit of the Partner’s creditors, (d) the Partner files an answer or other
pleading admitting or failing to contest the material allegations of a petition filed against the
Partner in any proceeding of the nature described in clause (b) above, (e) the Partner seeks,
consents to or acquiesces in the appointment of a trustee, receiver or liquidator for the Partner
or for all or any substantial part of the Partner’s properties, (f) any proceeding seeking
liquidation, reorganization or other relief of or against such Partner under any bankruptcy,
insolvency or other similar law now or
hereafter in effect has not been dismissed within one hundred twenty (120) days after the
commencement thereof, (g) the appointment without the Partner’s

 

 

consent or acquiescence of a trustee, receiver or liquidator has not been vacated or stayed within
ninety (90) days of such appointment, or (h) an appointment referred to in clause (g) which has
been stayed is not vacated within ninety (90) days after the expiration of any such stay.

          “Indemnitee” means (i) any Person made a party to a proceeding by reason of his status as (A)
the General Partner, (B) a director or officer of the Partnership or the General Partner, or (C) a
guarantor, pursuant to a loan guarantee or any other guarantee given to a third party in connection
with any partnership property or loan (other than in connection with the transfer of properties to
the Partnership in connection with the initial public offering of REIT Shares), including without
limitation, environmental indemnities, reimbursements agreements or guaranties to credit enhancers
under bond issues, undertakings or indemnities to title companies, or otherwise, for any
indebtedness of the Partnership or any Subsidiary of the Partnership (including, without
limitation, any indebtedness which the Partnership or any Subsidiary of the Partnership has assumed
or taken assets subject to), and (ii) such other Persons (including Affiliates of the General
Partner or the Partnership) as the General Partner may designate from time to time (whether before
or after the event giving rise to potential liability), in its sole and absolute discretion.

          “Limited Partner” means any Person named as a Limited Partner in Exhibit A attached hereto, as
such Exhibit may be amended from time to time, or any Substituted Limited Partner or Additional
Limited Partner, in such Person’s capacity as a Limited Partner in the Partnership.

          “Limited Partner Interest” means a Partnership Interest of a Limited Partner in the
Partnership representing a fractional part of the Partnership Interests of all Partners 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. A Limited Partner Interest may be expressed as a number of
Partnership Units.

          “Liquidation Preference Amount” means, with respect to any Preferred Unit as of any date of
determination, the amount (including accrued and unpaid distributions to the date of determination)
payable with respect to such Preferred Unit (as established by the instrument designating such
Preferred Unit) upon the voluntary or involuntary dissolution or winding up of the Partnership as a
preference over distributions to Partnership Units ranking junior to such Preferred Unit.

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

          “Management Corporation” means Colonial Properties Services, Inc.

          “Net Income” means, for any taxable period, the excess, if any, of the Partnership’s items of
income and gain for such taxable period over the Partnership’s items of loss and deduction for such
taxable period. The items included in the calculation of Net Income shall be determined in
accordance with federal income tax accounting principles, subject to the specific adjustments
provided for in Exhibit B.

          “Net Loss” means, for any taxable period, the excess, if any, of the Partnership’s items of
loss and deduction for such taxable period over the Partnership’s items of income and gain for such
taxable period. The items included in the calculation of Net Loss shall be determined in accordance
with federal income tax accounting principles, subject to the specific adjustments provided for in
Exhibit B.

 

 

          “Nonrecourse Built-in Gain” means, with respect to any Contributed Properties or Adjusted
Properties that are subject to a mortgage or negative pledge securing a Nonrecourse Liability, the
amount of any taxable gain that would be allocated to the Partners pursuant to Section 2.B of
Exhibit C if such properties were disposed of in a taxable transaction in full satisfaction of such
liabilities and for no other consideration.

          “Nonrecourse Deductions” has the meaning set forth in Regulations Section 1.704-2(b)(1), and
the amount of Nonrecourse Deductions for a Partnership Year shall be determined in accordance with
the rules of Regulations Section 1.704-2(c).

          “Nonrecourse Liability” has the meaning set forth in Regulations Section 1.752-1(a)(2).

          “Notice of Redemption” means the Notice of Redemption substantially in the form of Exhibit E
to this Agreement.

          “Original Limited Partner” means a Limited Partner who is a Partner on the date of this
Agreement and who owns one or more Original Limited Partnership Units on the date action is called
for under Section 13.1.

          “Original Limited Partnership Unit” means a Partnership Unit held by an Original Limited
Partner on the date of this Agreement and held by such Original Limited Partner on the date action
is called for under Section 18.3.

          “Partner” means a General Partner or a Limited Partner, and “Partners” means the General
Partner and the Limited Partners.

          “Partner Minimum Gain” means an amount, with respect to each Partner Nonrecourse Debt, equal
to the Partnership Minimum Gain that would result if such Partner Nonrecourse Debt were treated as
a Nonrecourse Liability, determined in accordance with Regulations Section 1.704-2(i)(3).

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

          “Partner Nonrecourse Deductions” has the meaning set forth in Regulations Section
1.704-2(i)(2), and the amount of Partner Nonrecourse Deductions with respect to a Partner
Nonrecourse Debt for a Partnership Year shall be determined in accordance with the rules of
Regulations Section 1.704-2 (i)(2).

          “Partnership” means the limited partnership formed under the Act and continued by this
Agreement, and any successor thereto.

          “Partnership Interest” means an ownership interest in the Partnership representing a Capital
Contribution 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. A Partnership Interest may be expressed as a number of Partnership Units.

          “Partnership Minimum Gain” has the meaning set forth in Regulations Section 1.704-2(b)(2), and
the amount of Partnership Minimum Gain, as well as any net increase or decrease in a Partnership
Minimum Gain, for a Partnership Year shall be determined in accordance with the rules of
Regulations
Section 1.704-2(d).

 

 

          “Partnership Record Date” means the record date established by the General Partner for the
distribution of Available Cash for a Distribution period pursuant to Section 5.1 hereof, which
record date shall be the same as the record date established by the General Partner for a
distribution to its shareholders of some of all of its portion of such distribution.

          “Partnership Unit” means a fractional undivided share of a class or series of Partnership
Interests. The ownership of Partnership Units shall be evidenced by such form of certificate as the
General Partner may adopt from time to time on behalf of the Partnership. Without limitation on the
authority of the General Partner as set forth in Section 4.2 hereof (but subject to the limitations
thereof), the General Partner may designate any Partnership Units, when issued, as Common Units or
as Preferred Units, may establish any other class of Partnership Units, and may designate one or
more series of any class of Partnership Units.

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

          “Percentage Interest” means, as to a Partner, with respect to any class or series of
Partnership Units held by such Partner, its interest in such class or series of Partnership Units
as determined by dividing the number of Partnership Units in such class or series owned by such
Partner by the total number of Partnership Units in such class or series then outstanding and as
specified in Exhibit A attached hereto, as such Exhibit may be amended from time to time. For
purposes of determining the rights and relationships among the various classes and series of
Partnership Units, Preferred Units shall not be considered to have any share of the aggregate
Percentage Interest in the Partnership unless, and
only to the extent, provided otherwise in the instrument creating such class or series of
Preferred Units.

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

          “Preferred REIT Share” means a preferred share of beneficial interest in the General Partner.

          “Preferred Unit” means Series A Preferred Units, Series B Preferred Units and any other
Partnership Unit issued from time to time pursuant to Section 4.2 hereof that is specifically
designated by the General Partner at the time of its issuance as a Preferred Unit. Each class or
series of Preferred Units shall have such designations, preferences, and relative, participating,
optional, or other special rights, powers, and duties, including rights, powers, and duties senior
to the Common Units, all as determined by the General Partner, subject to compliance with the
requirements of Section 4.2 hereof.

          “Prior Agreements” mean the Second Amended and Restated Agreement of Limited Partnership,
dated October 27, 1994, which is amended and restated in its entirety by this Agreement and which
amended the First Amended and Restated Agreement of Limited Partnership, dated as of September 29,
1993.

          “Recapture Income” means any gain recognized by the Partnership upon the disposition of any
property or asset of the Partnership, which gain is characterized as ordinary income because it
represents the recapture of deductions previously taken with respect to such property or asset.

          “Redeeming Partner” has the meaning set forth in Section 8.6.A hereof.

 

 

          “Redemption Right” shall have the meaning set forth in Section 8.6.A hereof.

          “Regulations” means the Income Tax Regulations promulgated under the Code, as such regulations
may be amended from time to time (including corresponding provisions of succeeding regulations).

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

          “REIT Share” shall mean a common share of beneficial interest in the General Partner.

          “REIT Shares Amount” means a number of REIT Shares equal to the product of the number of
Common Units offered for redemption by a Redeeming Partner, multiplied by the Conversion Factor;
provided that in the event the General Partner issues to all holders of REIT Shares rights,
options, warrants or convertible or exchangeable securities entitling the shareholders to subscribe
for or purchase REIT Shares, or any other securities or property (collectively, the “rights”) and
if the Partnership does not issue to all of the holders of Common Units at such time (other than
the General Partner) corresponding rights to subscribe for or purchase Common Units or other
securities or property corresponding to the securities or property covered by the rights granted by
the General Partner, then the REIT Shares Amount shall also include such rights that a holder of
that number of REIT Shares would be entitled to receive had it owned such REIT Shares at the time
such rights were issued, provided further that, if the rights issued by the General Partner are
issued pursuant to a shareholder rights plan (or other arrangement having the same objective and
substantially the same effect), then the REIT Shares Amount shall include such rights only to
the extent that (i) the Common Units offered for redemption were issued other than pursuant to
Section 4.4 of this Agreement, and (ii) such rights have not been exercised by the holders thereof
(and have not otherwise terminated or been redeemed or eliminated).

          “Residual Gain” or “Residual Loss” means any item of gain or loss, as the case may be, of the
Partnership recognized for federal income tax purposes resulting from a sale, exchange or other
disposition of Contributed Property or Adjusted Property, to the extent such item of gain or loss
is not allocated pursuant to Section 2.B.1(a) or 2.B.2(a) of Exhibit C to eliminate Book-Tax
Disparities.

          “Series A Preferred Unit” has the meaning set forth in Section 4.2.D.

          “Series B Preferred Unit” has the meaning set forth in Section 4.2.E.

          “704(c) Value” of any Contributed Property means the value of such property as set forth in
Exhibit D or if no value is set forth in Exhibit D, the fair market value of such property or other
consideration at the time of contribution as determined by the General Partner using such
reasonable method of valuation as it may adopt; provided, however, that the 704(c) Value of any
property deemed contributed to the Partnership for federal income tax purposes upon termination and
reconstitution thereof pursuant to Section 708 of the Code shall be determined in accordance with
Exhibit B hereof. Subject to Exhibit B hereof, the General Partner shall, in its sole and absolute
discretion, use such method as it deems reasonable and appropriate to allocate the aggregate of the
704(c) Values of Contributed Properties in a single or integrated transaction among the separate
properties on a basis proportional to their respective fair
market values.

 

 

          “Specified Redemption Date” means the tenth (10th) Business Day after receipt by the General
Partner of a Notice of Redemption; provided that no Specified Redemption Date shall occur before
one (1) year from the date of this Agreement, provided further that if the General Partner combines
its outstanding REIT Shares, no Specified Redemption Date shall occur after the record date and
prior to the effective date of such combination.

          “Subsidiary” means, with respect to any Person, any corporation, partnership or other entity
of which a majority of (i) the voting power of the voting equity securities or (ii) the outstanding
equity interests is owned, directly or indirectly, by such Person.

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

          “Terminating Capital Transaction” means any sale or other disposition of all or substantially
all of the assets of the Partnership or a related series of transactions that, taken together,
result in the sale or other disposition of all or substantially all of the assets of the
Partnership.

          “Unrealized Gain” attributable to any item of Partnership property means, as of any date of
determination, the excess, if any, of (i) the fair market value of such property (as determined
under Exhibit B hereof) as of such date, over (ii) the Carrying Value of such property (prior to
any adjustment to be made pursuant to Exhibit B hereof) as of such date.

          “Unrealized Loss” attributable to any item of Partnership property means, as of any date of
determination, the excess, if any, of (i) the Carrying Value of such property (prior to any
adjustment to be made pursuant to Exhibit B hereof) as of such date, over (ii) the fair market
value of such property (as determined under Exhibit B hereof) as of such date.

          “Valuation Date” means the date of receipt by the General Partner of a Notice of Redemption
or, if such date is not a Business Day, the first Business Day thereafter.

          “Value” means, with respect to a REIT Share, the average of the daily market price for the ten
(10) consecutive trading days immediately preceding the Valuation Date. The market price for each
such trading day shall be: (i) if the REIT Shares are listed or admitted to trading on any
securities exchange or the NASDAQ- National Market System, the closing price, regular way, on such
day, or if not such sale takes place on such day, the average of the closing bid and asked prices
on such day; (ii) if the REIT Shares are not listed or admitted to trading on any securities
exchange or the NASDAQ-National Market System, 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 REIT
Shares are not listed or admitted to trading on any securities exchange or the NASDAQ-National
Market System 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 (10) 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 (10) days prior to the
date in question, the Value of the REIT Shares 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 REIT Shares
Amount includes rights that a holder of REIT Shares would be entitled to receive, then the Value of
such rights shall be determined by the General Partner acting in good faith on the basis of such
quotations and other information as it considers, in its reasonable judgment, appropriate.

ARTICLE 2

ORGANIZATIONAL MATTERS

          Section 2.1 Organization and Continuation

          The Partnership is a limited partnership organized pursuant to the provisions of the Act and
upon the terms and conditions set forth in the Prior Agreement. The Partners hereby continue the
Partnership and amend and restate the Prior Agreement in its entirety. Except as expressly provided
herein to the contrary, the rights and obligations of the Partners and the administration and
termination of the Partnership shall be governed by the Act. The Partnership Interest of each
Partner shall be personal property for all purposes.

          Section 2.2 Name

          The name of the Partnership shall be Colonial Realty Limited Partnership. The Partnership’s
business may be conducted under any other name or names deemed advisable by the General Partner,
including the name of the General Partner or any Affiliate thereof. The words “Limited
Partnership,” “L.P.,” “Ltd.” or similar words or letters shall be included in the Partnership’s
name where necessary for the
purposes of complying with the laws of any jurisdiction that so requires. The General Partner
in its sole and absolute discretion may change the name of the Partnership at any time and from
time to time and shall notify the Limited Partners of such change in the next regular communication
to the Limited Partners.

          Section 2.3 Registered Office and Agent; Principal Office

          The address of the registered office of the Partnership in the State of Delaware shall be
located at 1013 Centre Road, County of New Castle, Wilmington, Delaware 19805, and the registered
agent for service of process on the Partnership in the State of Delaware at such registered office
shall be Corporation Service Company. The principal office of the Partnership shall be Colonial
Plaza, Suite 900, 2101 Sixth Avenue North, Birmingham, Alabama 35203, or such other place as the
General Partner may from time to time designate by notice to the Limited Partners. The Partnership
may maintain offices at such other place or places within or outside the States of Delaware and
Alabama as the General Partner deems advisable.

          Section 2.4 Power of Attorney

          A. Each Limited Partner and each Assignee hereby constitutes and appoints the General Partner,
any Liquidator, and authorized officers and attorneys-in-fact of each, and each of those acting
singly, in each case with full power of substitution, as its true and lawful agent and
attorney-in-fact, with full power and authority in its name, place and stead to:

	 	(1)	 	execute, swear to, acknowledge, deliver, file and record in the
appropriate public offices (a) all certificates, documents and other
instruments (including, without limitation, this Agreement
and the Certificate and all amendments or restatements

 

 

	 	 	 	thereof) that the General Partner or the Liquidator deems
appropriate or necessary to form, qualify or continue the
existence or qualification of the Partnership as a limited
partnership (or a partnership in which the limited Partners
have limited liability) in the State of Delaware and in all
other jurisdictions in which the Partnership may or plans to
conduct business or own property; (b) all instruments that the
General Partner deems appropriate or necessary to reflect any
amendment, change, modification or restatement of this
Agreement in accordance with its terms; (c) all conveyances
and other instruments or documents that the General Partner or
the Liquidator deems appropriate or necessary to reflect the
dissolution and liquidation of the Partnership pursuant to the
terms of this Agreement, including, without limitation, a
certificate of cancellation; (d) all instruments relating to
the admission, withdrawal, removal or substitution of any
Partner pursuant to, or other events described in, Article 11,
12 or 13 hereof or the Capital Contribution of any Partner;
and (e) all certificates, documents and other instruments
relating to the determination of the
rights, preferences and privileges of Partnership Interests;
and
	 
	 	(2)	 	execute, swear to, seal, acknowledge and file all ballots, consents,
approvals, waivers, certificates and other instruments appropriate or
necessary, in the sole and absolute discretion of the General Partner or
any Liquidator, to make, evidence, give, confirm or ratify any vote,
consent, approval, agreement or other action which is made or given by the
Partners hereunder or is consistent with the terms of this Agreement or
appropriate or necessary, in the sole discretion of the General Partner or
any Liquidator, to effectuate the terms or intent of this Agreement.

Nothing contained herein shall be construed as authorizing the General Partner or any Liquidator to
amend this Agreement except in accordance with Article 14 hereof or as may be otherwise expressly
provided for in this Agreement.

          B. The foregoing power of attorney is hereby declared to be irrevocable and a power coupled
with an interest, in recognition of the fact that each of the Partners will be relying upon the
power of the General Partner and any Liquidator to act as contemplated by this Agreement in any
filing or other action by it on behalf of the Partnership, and it shall survive and not be affected
by the subsequent Incapacity of any Limited Partner or Assignee and the transfer of all or any
portion of such Limited Partner’s or Assignee’s Partnership Units and shall extend to such Limited
Partner’s or Assignee’s heirs, successors, assigns and personal representatives. Each such Limited
Partner or Assignee hereby agrees to be bound by any representation made by the General Partner or
any Liquidator, acting in good faith pursuant to such power of attorney, and each such Limited
Partner or Assignee hereby waives any and all defenses which may be available to contest, negate or
disaffirm the action of the General Partner or any Liquidator, taken in good faith under such power
of attorney. Each Limited Partner or Assignee shall execute and deliver to the General Partner or
the Liquidator, within fifteen (15) days after receipt of the

 

 

General Partner’s or Liquidator’s request therefor, such further designation, powers of attorney
and other instruments as the General Partner or the Liquidator, as the case may be, deems necessary
to effectuate this Agreement and the purposes of the Partnership.

          Section 2.5 Term

          The term of the Partnership commenced on August 9, 1993, the date the Certificate was filed in
the office of the Secretary of State of Delaware in accordance with the Act and shall continue
until December 31, 2092, unless, the Partnership is dissolved sooner pursuant to the provisions of
Article 13 or as otherwise provided by law.

 

 

ARTICLE 3

PURPOSE

          Section 3.1 Purpose and Business

          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 General Partner at all times to be classified as a REIT, unless the General Partner
ceases to qualify as a REIT for reasons other than the conduct of the business of the Partnership,
(ii) to enter into any partnership, joint venture or other similar arrangement to engage in any of
the foregoing or to own 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 General Partner’s right, in its sole discretion, to cease qualifying as a REIT, the
Partners acknowledge the General Partner’s current status as a REIT inures to the benefit of all of
the Partners and not solely to the benefit of the General Partner.

          Section 3.2 Powers

          The Partnership is empowered to do any and all acts and things necessary, appropriate, proper,
advisable, incidental to or convenient for the furtherance and accomplishment of the purposes and
business described herein and for the protection and benefit of the Partnership, provided that the
Partnership shall not take any action which, in the judgment of the General Partner, in its sole
and absolute discretion, (i) could adversely affect the ability of the General Partner to continue
to qualify as a REIT, (ii) could subject the General Partner to any additional taxes under Section
857 or Section 4981 of the Code, or (iii) could violate any law or
regulation of any governmental body or agency having jurisdiction over the General Partner or
its securities, unless such action shall have been specifically consented to by the General Partner
in writing.

ARTICLE 4

CAPITAL CONTRIBUTIONS

          Section 4.1 Capital Contributions of the Limited Partners and the Former General Partner

          On the Effective Date, certain of the Limited Partners and the Former General Partner made the
Capital Contributions described in the section captioned “Formation of the Company” in the final
Prospectus dated September 24, 1993 of the General Partner in connection with the initial public
offering of the REIT Shares. To the extent the Partnership acquires any property by the merger of
any other Person into the Partnership, Persons who receive Partnership Interests in exchange for
their interests in the Person merging into the Partnership shall become Partners and shall be
deemed to have made Capital Contributions as provided in the applicable merger agreement. The
Partners shall own Partnership Units in the amounts set forth for such Partner in Exhibit A and
shall have a Percentage Interest in the Partnership as set forth Exhibit A, which Percentage
Interest shall be adjusted in Exhibit A from time to time by

 

 

the General Partner to the extent necessary to reflect accurately redemptions, Capital
Contributions, the issuance of additional Partnership Units (pursuant to any merger or otherwise),
or similar events having an effect on a Partner’s Percentage Interest. The Capital Contributions of
the Partners shall be at all times as shown on the books and records of the General Partner. The
number of Partnership Units held by the General Partner equal to one percent (1%) of all
outstanding Partnership Units from time to time shall be deemed to be the general partner Partner
Units and shall be the General Partnership Interest. Except as provided in Sections 4.2 and 10.5,
the Partners shall have no obligation to make any additional Capital Contributions or loans to the
Partnership.

          Section 4.2 Issuances of Additional Partnership Interests

          A. The General Partner is hereby authorized to cause the Partnership from time to time to
issue to the Partners (including the General Partner) or other Persons additional Partnership Units
or other Partnership Interests 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 Partner Interests,
all as shall be determined by the General Partner in its sole and absolute discretion 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 that no such additional Partnership Units or other
Partnership Interests shall be issued to the General Partner unless
either (a)(1) the additional Partnership Interests are issued in connection with an issuance
of additional REIT Shares or Preferred REIT Shares of the General Partner, which shares have
designations, preferences and other rights such that the economic interests attributable to such
shares are substantially similar to the designations, preferences and other rights of the
additional Partnership Interests issued to the General Partner in accordance with this Section
4.2.A, and (2) the General Partner shall make a Capital Contribution to the Partnership in an
amount equal to the net proceeds raised in connection with the issuance of such additional REIT
Shares or Preferred REIT Shares of the General Partner, or (b) the additional Partnership Interests
in the applicable class or series are issued to all Partners in proportion to their respective
Percentage Interests in such class or series.

          B. The General Partner shall not issue any additional REIT Shares or Preferred REIT Shares
(other than REIT Shares issued pursuant to Section 8.6), or rights, options, warrants or
convertible or exchangeable securities containing the right to subscribe for or purchase REIT
Shares or Preferred REIT Shares (collectively “New Securities”) other than to all holders of REIT
Shares unless (i) the General Partner shall cause the Partnership to issue to 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 New Securities, and (ii) the General Partner contributes
the net proceeds from the issuance of such New Securities and from the exercise of rights contained
in such New Securities to the Partnership. Without limiting the foregoing, the General Partner is
expressly authorized to issue New Securities for less than fair market value, and the General
Partner is expressly authorized to cause the Partnership to issue to the General
Partner corresponding Partnership Interests, so long as (x) the General Partner concludes in
good faith that such issuance is in the interests of the General Partner and the Partnership (for
example, and not by way of limitation,

 

 

the issuance of REIT Shares and corresponding Partnership Units pursuant to an employee stock
purchase plan providing for employee 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), and (y) the General
Partner contributes all proceeds from such issuance and exercise to the Partnership.

          C. Under the authority granted to it by Section 4.2.A, the General Partner hereby establishes
an additional class of Partnership Units entitled “Class B Units” that is available to be issued in
lieu of Class A Units, at the election of the General Partner, in its sole and absolute discretion,
to newly admitted Partners in exchange for the contribution by such Partners of cash, real estate
partnership interests, stock, notes or other assets or consideration. Except as otherwise provided
below and in Section 5.1.B hereof, each Class B Unit shall have the same designations, rights,
preferences, powers and duties as each Class A Unit:

	 	(1)	 	The amount of Available Cash distributable with respect to Class B Units shall be
determined in accordance with Section 5.1.B hereof.
	 
	 	(2)	 	Each Class B Unit shall be converted automatically into a Class A Unit on the day
immediately following the Partnership Record Date for the Distribution Period (as
defined in Section 5.1.B) in which the Class B Unit was issued, without the
requirement for any action by either the
Partnership or the Partner holding the Class B Unit.
	 
	 	(3)	 	A holder of Class B Units will not have the Redemption Right under Section 8.6
with respect to its Class B Units. The Redemption Right for a holder of Class A Units
into which Class B Units have been converted pursuant to clause (2) above shall be the
same as set forth in Section 8.6 except that such Redemption Right shall not be
exercisable for a period of one (1) year following the issuance of such Class B Units
(or such longer or shorter period as may be set forth in the contribution agreement or
amendment to this Agreement pursuant to which such Class B Units were issued).
	 
	 	(4)	 	A holder of either Class B Units or Class A Units into which Class B Units have
been converted pursuant to clause (2) above shall be subject to the restrictions on
transfer imposed by Sections 11.3.C through 11.3.E of this Agreement (in addition to
any other restrictions on transfer as may be set forth in the contribution agreement
or amendment to this Agreement pursuant to which such Class B Units were issued).
	 
	 	(5)	 	The General Partner shall cause Class B Units to be issued by the Partnership only
pursuant to an amendment to this Agreement under the authority granted to the General
Partner by Section 14.1.B.3 hereof, which amendment shall designate that the newly
issued Partnership Units are Class B Units.
The General Partner shall have the right, in its sole and absolute
discretion, subject to Section 4.2.A above, to determine whether the
Partnership should issue Class A Units, Class B Units (or one or more
series thereof), or another class of Partnership Interests in connection
with a contribution of property, other assets, or other consideration to
the Partnership.

 

 

          D. Series A Preferred Units. Under the authority granted to it by Section 4.2.A hereof, the
General Partner hereby establishes an additional class of Partnership Units entitled “Series A
Cumulative Redeemable Preferred Units” (the “Series A Preferred Units”). Series A Preferred Units
shall have the designations, preferences, rights, powers and duties as set forth in Exhibit G
hereto.

          E. Series B Preferred Units. Under the authority granted to it by Section 4.2.A hereof, the
General Partner hereby establishes an additional class of Partnership Units entitled “Series B
Cumulative Redeemable Preferred Units” (the “Series B Preferred Units”). Series B Preferred Units
shall have the designations, preferences, rights, powers and duties as set forth in Exhibit H
hereto.

          F. Series 1998 Preferred Units. Under the authority granted to it by Section 4.2.A hereof, the
General Partner hereby establishes an additional class of Partnership Units entitled “Series 1998
Junior Participating Preferred Units” (the “Series 1998 Preferred Units”). Series 1998 Preferred
Units shall have the designations, preferences, rights, powers and duties as set forth in Exhibit I
hereto.

          Section 4.3 Contribution of Proceeds of Issuance of REIT Shares

          In connection with the issuance of REIT Shares or Preferred REIT Shares pursuant to Section
4.2, the General Partner shall contribute any net proceeds raised in connection with such
issuance the Partnership; provided that if the net proceeds actually received by the General
Partner 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, then the General Partner shall
be deemed to have made a Capital Contribution to the Partnership in the amount equal to the sum of
the net proceeds of such issuance plus the amount of such underwriter’s discount and other expenses
paid by the General Partner.

          Section 4.4 “Flip-in” Preemptive Rights

          If the General Partner acquires any Class A Units using the proceeds from any exercise of any
rights (as defined in the definition of REIT Shares Amount) issued under a shareholder rights plan
(or other arrangement having the same objective and substantially the same effect), then (a) the
holders of Common Units at such time (other than the General Partner) as a group shall have the
right to acquire, at the same price per Class A Unit paid by the General Partner, a total number of
additional Class A Units equal to the product of (i) the total number of Common Units held by such
holders, multiplied by (ii) a fraction, the numerator of which is the number of Class A Units
issued to the General Partner as a result of the exercise of such rights and the denominator of
which is the total number of Class A Units held by the General Partner immediately prior to such
issuance (which fraction is referred to as the “Exercise Percentage”), and (b) each holder of a
Class A Unit or Class B Unit at such time shall have the right to acquire, at the same price per
Class A Unit paid by the General Partner, a number of Class A Units equal to the product of (iii)
the aggregate number of Common Units that such holder holds at such time, multiplied by (iv) the
Exercise Percentage.

          Thus, for example, if the General Partner were to acquire 2,000,000 Class A Units at $5 per
Unit from the proceeds of the exercise of

 

 

outstanding rights issued under a shareholder rights plan at a time when the General Partner
already owned 8,000,000 Class A Units out of a total of 12,000,000 outstanding Common Units (which
would represent a 25% increase in the number of Class A Units held by the General Partner), then
the other holders of Common Units as a group would have the right to purchase a total of 1,000,000
Class A Units at $5 per Class A Unit, and each holder of a Class A Unit or Class B Unit would be
entitled to purchase his proportionate share of such Class A Units, or .25 Class A Units for each
Class A Unit or Class B Unit then held by such holder.

          In the event Partnership Units or Partnership Interests other than Class A Units (including,
without limitation, Series 1998 Preferred Units) are issued to the General Partner using proceeds
of any exercise of rights issued under a shareholder rights plan (or other arrangement), the
holders of Common Units shall be granted the right to acquire such other Partnership Units or
Partnership Interests at the same price as paid by the General Partner and in such amounts as would
be comparable to their rights had Class A Units been issued instead. The General Partner shall
provide prompt written notice to the holders of Common Units of its acquisition of Class A Units
(or other Partnership Units or Partnership Interests) using such proceeds and shall establish in
good faith such procedures as it deems appropriate (including, without limitation, procedures to
eliminate the issuance of fractional Partnership Units if the General Partner deems appropriate) to
effectuate the rights of the holders of Common Units under the preceding provisions of this Section
4.4. Except to the extent expressly granted by the Partnership pursuant to this Section 4.4 or
another agreement, no person shall have any preemptive, preferential or other similar right
with respect to (i) additional Capital Contributions or loans to the Partnership; or (ii) issuance
or sale of any Partnership Units or other Partnership Interests.

 

 

ARTICLE 5

DISTRIBUTIONS

          Section 5.1 Requirement and Characterization of Distributions

          A. The General Partner shall distribute at least quarterly an amount equal to 100%
of Available Cash generated by the Partnership during such quarter or shorter period to
the Partners who are Partners on the Partnership Record Date with respect to such
quarter or shorter period in the following order of priority:

	 	(i)	 	First, to the holders of Preferred Units in such amount as is required
for the Partnership to pay all distributions with respect to such
Preferred Units due or payable in accordance with the instruments
designating such Preferred Units through the last day of such quarter or
shorter period; such distributions shall be made to such Partners in such
order of priority and with such preferences as have been established with
respect to such Preferred Units as of the last day of such calendar
quarter or shorter period; and then
	 
	 	(ii)	 	To the holders of Common Units in proportion to their respective
Percentage Interests in the Common Units on such Partnership Record
Date, subject to the provisions of Sections 5.1.B and 5.1.C;

provided that in no event may a Partner receive a distribution of Available Cash with
respect to a Partnership Unit if such Partner is entitled to receive a distribution out
of such Available Cash with respect to a REIT Share for which such Partnership Unit has
been redeemed or exchanged. The General Partner shall take such reasonable efforts, as
determined by it in its sole and absolute discretion and consistent with its
qualification as a REIT, to distribute Available Cash to the Limited Partners so as to
preclude any such distribution or portion thereof from being treated as part of a sale
of property to the Partnership by a Limited Partner under Section 707 of the Code or
the Regulations thereunder; provided that the General Partner and the Partnership shall
not have liability to a Limited Partner under any circumstances as a result of any
distribution to a Limited Partner being so treated.

          B. If for any quarter or shorter period with respect to which a distribution is to
be made (a “Distribution Period”) Class B Units are outstanding on the Partnership
Record Date for such Distribution Period, the General Partner shall allocate the
Available Cash with respect to such Distribution Period available for distribution
pursuant to Section 5.1.A(ii) above after distributions to all Preferred Units provided
for in Section 5.1.A(i) above have been made (“Common Unit Available Cash”) between the
Partners who are holders of Class A Units (“Class A”) and the Partners who are holders
of Class B Units (“Class B”) as follows:

 

 

     1) Class A shall receive that portion of the Common Unit Available Cash (the
“Class A Share”) determined by multiplying the amount of Common Unit Available Cash
by the following fraction:

     2) Class B shall receive that portion of the Common Unit Available Cash (the
“Class B Share”) determined by multiplying the amount of Common Unit Available Cash
by the following fraction:

     3) For purposes of the foregoing formulas, (i) “A” equals the number of Class A
Units outstanding on the Partnership Record Date for such Distribution Period; (ii)
“B” equals the number of Class B Units outstanding on the Partnership Record Date for
such Distribution Period; (iii) “Y” equals the number of days in the Distribution
Period; and (iv) “X” equals the number of days in the Distribution Period for which
the Class B Units were issued and outstanding.

          The Class A Share shall be distributed among Partners holding Class A Units on the
Partnership Record Date for the Distribution Period in accordance with the number of Class A
Units held by each Partner on such Partnership Record Date; provided that in no event may a
Partner receive a distribution of Available Cash with respect to a Class A Unit if a Partner is
entitled to receive a distribution out of such Available Cash with respect to a REIT Share for
which such Class A Unit has been redeemed or exchanged. The Class B Share shall be distributed
among the Partners holding Class B Units on the Partnership Record Date for the Distribution
Period in accordance with the number of Class B Units held by each Partner on such Partnership
Record Date. In no event shall any Class B Units be entitled to receive any distribution of
Available Cash for any Distribution Period ending prior to the date on which such Class B
Units are issued.

               C. In the event that Class B Units which have been issued on different dates are outstanding
on the Partnership Record Date for any Distribution Period, then the Class B Units issued on each
particular date shall be treated as a separate series of Common Units for purposes of making the
allocation of Common Unit Available Cash for such Distribution Period among the holders of Common
Units (and the formula for making such allocation, and the definitions of variables used therein,
shall be modified accordingly). Thus, for example, if two series of Class B Units are outstanding
on the Partnership Record Date for any Distribution Period, the allocation formula for each
series,

 

 

“Series B1” and “Series B2,” would be as follows:

     1) Series B1 shall receive that portion of the Common Unit Available Cash
determined by multiplying the amount of Common Unit Available Cash by the following
fraction:

 

 

     2) Series B2 shall receive that portion of the Common Unit Available Cash
determined by multiplying the amount of Common Unit Available Cash by the following
fraction:

     3) For purposes of the foregoing formulas the definitions set forth
in Section 5.1.B.3 remain the same except that (i) “B1” equals the number
of Common Units in Series B1 outstanding on the Partnership Record Date
for such Distribution Period; (ii) “B2” equals the number of Common Units
in Series B2 outstanding on the Partnership Record Date for such
Distribution Period; (iii) “X1” equals the number of days in the
Distribution Period for which the Partnership Units in Series B1 were
issued and outstanding; and (iv) “X2” equals the number of days in the
Distribution Period for which the Common Units in Series B2 were issued
and outstanding.

     D. Notwithstanding anything to the contrary contained herein, in no event shall a
Partner receive a distribution of Available Cash with respect to any Common Unit with
respect to any quarter or shorter period until such time as the Partnership has
distributed to the holders of Preferred Units an amount sufficient to pay all
distributions payable with respect to such Preferred Units through the last day of such
quarter or shorter period, in accordance with the instruments designating such
Preferred Units.

          Section 5.2 Amounts Withheld

          All amounts withheld pursuant to the Code or any provisions of any state or local tax law and
Section 10.5 hereof with respect to any
allocation, payment or distribution to the General Partner, the Limited Partners or Assignees
shall be treated as amounts distributed to the General Partner, Limited Partners, or Assignees
pursuant to Section 5.1 for all purposes under this Agreement.

          Section 5.3 Distributions Upon Liquidation

          Proceeds from a Terminating Capital Transaction and any other cash received or reductions in
reserves made after commencement of the liquidation of the Partnership shall be distributed to the
Partners in accordance with Section 13.2.

ARTICLE 6

ALLOCATIONS

          Section 6.1 Allocations for Capital Account Purposes

     For purposes of maintaining the Capital Accounts and in determining the rights of the Partners
among themselves, the Partnership’s items of income,

 

 

gain, loss and deduction (computed in accordance with Exhibit B hereof); shall be allocated among
the Partners in each taxable year (or portion thereof) as provided herein below.

          A. Net Income. After giving effect to the special allocations set forth in Section 1 of
Exhibit C (including Section 1.F thereof), Net Income shall be allocated:

               (i) first, to the General Partner to the extent that Net
Losses previously allocated to the General Partner pursuant to
Section 6.1B(iii) below exceed Net Income previously allocated
to the General Partner pursuant to this Section 6.1A(i);

               (ii) second, to Partners holding Preferred Units (and if
there are Preferred Units with different priorities in
preference in distribution, then in the order of their
preference in distribution) to the extent that Net Losses
previously allocated to such Partners pursuant to Section
6.1B(ii) below exceed Net Income previously allocated to such
Partners pursuant to this Section 6.1A(ii);

               (iii) third, to Partners holding Common Units to the
extent that Net Losses previously allocated to such Partners
pursuant to Section 6.1.B(i) below exceed Net Income
previously allocated to such Partners pursuant to this Section
6.1A(iii);

               (iv) fourth, to Partners holding Series B Preferred Units
until each such Partner has been allocated Net Income equal to
the excess of (x) the amount of the cumulative Priority Return
such Partner is entitled to the last day of the current
taxable year or to the date of redemption, to the extent such
Series B Preferred Units are redeemed during such taxable
year, over (y) the cumulative Net Income allocated to such
Partners pursuant to this Section 6.1A(iv) for all prior
taxable years; and

               (v) fifth, to the Partners in accordance with their
respective Percentage Interests in Common Units.

	 	B.	 	Net Losses. After giving effect to the special allocations set forth in
Section 1 of Exhibit C
(including Section 1.F thereof), Net Losses shall be allocated:

               (i) first, to the Partners holding Common Units in
accordance with their respective Percentage Interests in
Common Units, until the Adjusted Capital Account (ignoring for
this purpose any amounts a Partner is obligated to contribute
to the capital of the Partnership or is deemed obligated to
contribute pursuant to Regulations Section
1.704-1(b)(2)(ii)(c)(2)) of
each Partner is reduced to zero;

 

 

          (ii) second, to Partners holding Preferred Units in
accordance with each such Partner’s respective percentage
interests in the Preferred Units determined under the
respective terms of the Preferred Units (and if there are
Preferred Units with different priorities in preference in
distribution, then in the reverse order of their preference in
distribution), until the Adjusted Capital Account (modified in
the same manner as in clause (i)) of each such holder is
reduced to zero; and

               (iii) third, to the General Partner.

          To the extent permitted under Sections 704(b) and 704(c) of the Code and the Regulations
thereunder, solely for purposes of allocating Net Income or Net Losses in any taxable year (or a
portion thereof) to the Partners holding Series B Preferred Units with respect to such Units
pursuant to Section 6.1 hereof, items of Net Income or Net Losses, as the case may be, shall not
include Depreciation with respect to properties that are “ceiling limited” in respect of holders of
Series B Preferred Units. For purposes of the preceding sentence, Partnership property shall be
considered “ceiling limited” in respect of a holder of Series B Preferred Units if Depreciation
attributable to such Partnership property which would otherwise be allocable to such holder,
without regard to this paragraph, exceeds depreciation determined for federal income tax purposes
attributable to such Partnership property which would otherwise be allocable to such holder by more
than 5%. Notwithstanding the foregoing sentences in this paragraph, in applying this paragraph, the
General Partner may, in its
discretion for administrative ease and convenience, calculate Net Income or Net Loss in any
taxable year (or a portion thereof) allocable to the Partners holding Series B Preferred Units by
excluding Depreciation with respect to all properties of the Partnership.

ARTICLE 7

MANAGEMENT AND OPERATIONS OF BUSINESS

          Section 7.1 Management

          A. Except as otherwise expressly provided in this Agreement, all management powers over the
business and affairs the Partnership are and shall be exclusively vested in the General Partner,
and no Limited Partner shall have any right to participate in or exercise control or management
power over the business and affairs of the Partnership. The General Partner may not be removed by
the Limited Partners with or without cause. In addition to the powers now or hereafter granted a
general partner of a limited partnership under applicable law or which are granted to the General
Partner under any other provision of this Agreement, the General Partner, subject to Section 7.3
hereof, shall have full power and authority to do all things deemed necessary or desirable by it to
conduct the business of the Partnership, to exercise all powers set forth in Section 3.2 hereof and
to effectuate the purposes set forth in Section 3.1 hereof, including, without limitation:

	 	(1)	 	the making of any expenditures, the lending or borrowing of money (including, without
limitation, making prepayments on loans and borrowing money to permit the Partnership to
make distributions to its Partners in such amounts as will permit the General Partner (so
long as the General Partner qualifies as a REIT) to avoid the payment of any federal income
tax (including, for this purpose, any excise tax

 

 

	 	 	 	pursuant to Section 4981 of the Code) and to make distributions to the General
Partner such that the General Partner can distribute to its shareholders amounts
sufficient to permit the General Partner to maintain REIT status), the assumption
or guarantee of, or other contracting for, indebtedness and other liabilities, the
issuance of evidences of indebtedness (including the securing of same by deed to
secure debt, mortgage, deed of trust or other lien or encumbrance on the
Partnership’s assets) and the incurring of any obligations it deems necessary for
the conduct of the activities of the Partnership;
	 
	 	(2)	 	the making of tax, regulatory and other filings, or rendering of periodic or other reports to
governmental or other agencies having jurisdiction over the business or assets of the
Partnership;
	 
	 	(3)	 	the acquisition, disposition, mortgage, pledge, encumbrance, hypothecation or exchange of any
assets of the Partnership (including the exercise or grant of any conversion, option, privilege,
or subscription right or other right available in connection with any assets at any time held by
the Partnership) or the merger or other combination of the Partnership with or into another
entity (all of the foregoing subject to any prior approval only to the extent required by
Section 7.3 hereof);
	 
	 	(4)	 	the use of the assets of the Partnership (including, without limitation, cash on hand) for
any purpose consistent with the terms of this Agreement and on any terms it sees fit, including,
without limitation, the financing of the conduct of the operations of the General Partner, the
Partnership or any of the Partnership’s Subsidiaries, the lending of funds to other Persons
(including, without limitation, the Subsidiaries of the Partnership and/or the
General Partner) and the repayment of obligations of the Partnership and its Subsidiaries and
any other Person in which it has an equity investment, and the making of capital contributions
to its Subsidiaries;
	 
	 	(5)	 	the management, operation, leasing, landscaping, repair, alteration, demolition or
improvement of any real property or improvements owned by the Partnership or any Subsidiary of
the Partnership;
	 
	 	(6)	 	the negotiation, execution, and performance of any contracts, conveyances or other
instruments that the General Partner considers useful or necessary to the conduct of the
Partnership’s operations or the implementation of the General Partner’s powers under this
Agreement, including contracting with contractors, developers, consultants, accountants, legal
counsel, other professional advisors and other agents and the payment of their expenses and
compensation out of the Partnership’s assets;
	 
	 	(7)	 	the distribution of Partnership cash or other Partnership assets in accordance with this
Agreement;
	 
	 	(8)	 	holding, managing, investing and reinvesting cash and other assets of the Partnership;

 

 

	 	(9)	 	the collection and receipt of revenues and income of the Partnership;
	 
	 	(10)	 	the establishment of one or more divisions of the Partnership, the selection and dismissal
of employees of the Partnership, any division of the Partnership, or the General Partner
(including, without limitation, employees having titles such as “president,” “vice president,”
“secretary” and “treasurer” of the Partnership, any division of the Partnership, or the General
Partner), and agents, outside attorneys, accountants, consultants and contractors of the General
Partner or the Partnership or any division of the Partnership, and the determination of their
compensation and other terms of employment or hiring;
	 
	 	(11)	 	the maintenance of such insurance for the benefit of the Partnership and the Partners as it
deems necessary or appropriate;
	 
	 	(12)	 	the formation of, or acquisition of an interest in, and the contribution of 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 investment from
time to time);
	 
	 	(13)	 	the control of any matters affecting the rights and obligations of the Partnership,
including the settlement, compromise, submission to arbitration or any other form of dispute
resolution, or abandonment of, any claim, cause of action, liability, debt or damages, due or
owing to or from the Partnership, the commencement or defense of suits, legal proceedings,
administrative proceedings, arbitration or other forms of dispute,
resolution, and the representation of the Partnership in all suits or legal proceedings,
administrative proceedings, arbitrations or other forms of dispute resolution, the incurring of
legal expense, and the indemnification of any Person against liabilities and contingencies to
the extent permitted by law;
	 
	 	(14)	 	the undertaking of any action in connection with the Partnership’s direct or indirect
investment in its Subsidiaries or any other Person (including, without limitation, the
contribution or loan of funds by the Partnership to such Persons);
	 
	 	(15)	 	the determination of the fair market value of any Partnership property distributed in kind
using such reasonable method of valuation as it may adopt;
	 
	 	(16)	 	the exercise, directly or indirectly, through any attorney-in-fact acting under a general
or limited power of attorney, any right, including the right to vote, appurtenant to any asset
or investment held by the Partnership;
	 
	 	(17)	 	the exercise of any of the powers of the General Partner

 

 

	 	 	 	enumerated in this Agreement on behalf of or in connection with any
Subsidiary of the Partnership or any other Person in which the
Partnership has a direct or indirect interest, or jointly with any such
Subsidiary or other Person;

	 	(18)	 	the exercise of any of the powers of the General Partner enumerated in this
Agreement on behalf of any Person in which the Partnership does not have an interest
pursuant to contractual or other arrangements with such Person; and
	 
	 	(19)	 	the making, execution and delivery of any and all deeds, leases, notes, deeds to
secure debt, mortgages, deeds of trust, security agreements, conveyances, contracts,
guarantees, warranties, indemnities, waivers, releases or legal instruments or
agreements in writing necessary or appropriate in the judgment of the General Partner
for the accomplishment of any of the powers of the General Partner enumerated in this
Agreement.

          B. 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 (except as provided in Section 7.3), the Act or any applicable law, rule or
regulation, to the fullest extent permitted under the Act or other applicable law. The execution,
delivery or performance by the General Partner or the Partnership of any agreement authorized or
permitted under this Agreement shall not constitute a breach by the General Partner of any duty
that the General Partner may owe the Partnership or the Limited Partners or any other Persons under
this Agreement or of any duty stated or implied by law or equity.

          C. At all times from and after the date hereof, the General Partner may cause the Partnership
to obtain and maintain (i) casualty, liability and other insurance on the properties of the
Partnership and (ii) liability insurance for the Indemnitees hereunder.

          D. At all times from and after the date hereof, the General Partner may cause the Partnership
to establish and maintain at any and all times working capital accounts and other cash or similar
balances in such amounts as the General Partner, in its sole and absolute discretion, deems
appropriate and reasonable from time to time.

          E. In exercising its authority under this Agreement, the General Partner may, but shall be
under no obligation to, take into account the tax consequences to any Partner of any action taken
by it; provided that, if the General Partner decides to refinance (directly or indirectly) any
outstanding indebtedness of the Partnership, the General Partner shall use reasonable efforts to
structure such refinancing in a manner that minimizes any adverse tax consequences therefrom to the
Limited Partners, and provided further that, in deciding whether or not to dispose of any property
that represents more than one percent of the Partnership’s total assets, the General Partner shall
consider in good faith the income tax consequences of such disposition for both the General
Partners and the Limited Partners. The General Partner and the Partnership shall not have liability
to a Limited Partner under any circumstances as a result of an income tax liability incurred by
such Limited Partner as a result of an action (or inaction) by the General Partner pursuant to its
authority under this Agreement.

 

 

          Section 7.2 Certificate of Limited Partnership

          The General Partner has previously filed the Certificate with the Secretary of State of
Delaware as required by the Act. The General Partner shall use all reasonable efforts to cause to
be filed such other certificates or documents as may be reasonable and necessary or appropriate for
the formation, continuation, qualification and operation of a limited partnership (or a partnership
in which the limited partners have limited liability) in the State of Delaware and any other state,
or the District of Columbia, in which the Partnership may elect to do business or own property. To
the extent that such action is determined by the General Partner to be reasonable and necessary or
appropriate, the General Partner shall file amendments to and restatements of the Certificate and
do all the things to maintain the Partnership as a limited partnership (or a partnership in which
the limited partners have limited liability) under the laws of the State of Delaware and each other
state or the District of Columbia in which the Partnership may elect to do business or own
property. Subject to the terms of Section 8.5.A(4) hereof, the General Partner shall not be
required, before or after filing, to deliver or mail a copy of the Certificate or any amendment
thereto to any Limited Partner.

          Section 7.3 Restrictions on General Partner’s Authority

          A. The General Partner may not take any action in contravention of an express prohibition or
limitation of this Agreement without the written Consent of all of the Limited Partners (including
Limited Partner Interests held by the General Partner) (or such lower percentage of the Limited
Partners as may be specifically provided for under a provision of this Agreement or the Act).

          B.
Except as provided in Article 13 hereof, the General Partner may not sell, exchange,
transfer or otherwise dispose of all or substantially all of the Partnership’s assets in a single transaction or a series of related
transactions (including by way of merger, consolidation or other combination with any other Person)
without the Consent of holders of three-fourths (3/4) of the outstanding Common Units held by
Limited Partners (including Common Units held by the General Partner as Limited Partner Interests).

          Section 7.4 Reimbursement of the General Partner

          A. Except as provided in this Section 7.4 and elsewhere in this Agreement (including the
provisions of Articles 5 and 6 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.

          B. The General Partner shall be reimbursed on a monthly basis, or such other basis as the
General Partner may determine in its sole and absolute discretion, for all expenses that it incurs
relating to the ownership and operation of, or for the benefit of, the Partnership; provided that
the amount of any such reimbursement shall be reduced by any interest earned by the General Partner
with respect to bank accounts or other instruments or accounts held by it on behalf of the
Partnership as permitted in Section 7.5.A. The Limited Partners acknowledge that, for purposes of
this Section 7.4.B, all expenses of the General Partner are deemed incurred for the benefit of the
Partnership. Such reimbursements shall be in addition to any reimbursement to the General Partner
as a result of indemnification pursuant to Section 7.7 hereof.

          C. As set forth in Section 4.3, the General Partner shall be treated as having made a Capital
Contribution in the amount of all expenses that it incurs relating to any issuance of additional
Partnership Interests or REIT Shares pursuant to Section 4.2 hereof.

 

 

          D. In the event that the General Partner shall elect to purchase REIT Shares from its
shareholders for the purpose of delivering such REIT Shares to satisfy an obligation under any
dividend reinvestment program adopted by the General Partner, any employee stock purchase plan
adopted by the General Partner, or any similar obligation or arrangement undertaken by the General
Partner in the future, the purchase price paid by the General Partner for such REIT Shares and any
other expenses incurred by the General Partner in connection with such purchase shall be considered
expenses of the Partnership and shall be reimbursed to the General Partner, as the case may be,
subject to the condition that: (i) if such REIT Shares subsequently are to be sold by the General
Partner, the General Partner shall pay to the Partnership any proceeds received by the General
Partner for such REIT Shares (provided that a transfer of REIT Shares for Units pursuant to Section
8.6 would not be considered a sale for such purposes); and (ii) if such REIT Shares are not
retransferred by the General Partner within 30 days after the purchase thereof, the General Partner
shall cause the Partnership to cancel a number of Class A Units held by the General Partner equal
to the product obtained by multiplying the Conversion Factor by the number of such REIT Shares.

          Section 7.5 Outside Activities of the General Partner

     A. The General Partner shall not directly or indirectly enter into or conduct any business
other than in connection with the ownership, acquisition and disposition of Partnership Interests
as a General Partner or Limited Partner and the management of the business of the Partnership, the
ownership of the stock of the Management Corporation and such activities as are incidental thereto.
The General Partner shall not incur any debts other than that for which the General Partner may be liable in its capacity as
General Partner of the Partnership and other than a debt incurred by the General Partner pursuant
to Article III of the Declaration of Trust. The assets of the General Partner shall be limited to
Partnership Interests and stock of the Management Corporation. The General Partner shall not hold
any assets other than (i) Partnership Interests as a General Partner or Limited Partner, (ii) stock
of the Management Corporation, and (iii) other than such bank accounts or similar instruments or
accounts as it deems necessary to carry out its responsibilities contemplated under this Agreement
and its organizational documents. The General Partner and any Affiliates of the General Partner may
acquire Limited Partner Interests and shall be entitled to exercise all rights of a Limited Partner
relating to such Limited Partner Interests.

     B. Except as provided in Section 7.4.D, in the event the General Partner exercises its rights
under Article VI of the Declaration of Trust to purchase REIT Shares, then the General Partner
shall cause the Partnership to purchase from it that number of Class A Units equal to the product
obtained by multiplying the number of REIT Shares to be purchased by the General Partner times the
Conversion Factor on the same terms and for the same aggregate price that the General Partner
purchased such REIT Shares.

          Section 7.6 Contracts with Affiliates

          A. The Partnership may lend or contribute funds or other assets to its Subsidiaries, other
Persons in which it has an equity investment, or the Management Corporation 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.

 

 

          B. Except as provided in Section 7.5.A, 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
consistent with this Agreement and applicable law as the General Partner, in its sole and absolute
discretion, believes are advisable.

          C. Except as expressly permitted by this Agreement, neither the General Partner nor any of its
Affiliates shall sell, transfer or convey any property to, or purchase any property from, the
Partnership, directly or indirectly, except pursuant to transactions that are determined by the
General Partner in good faith to be fair and reasonable and no less favorable to the Partnership
than would be obtained from an unaffiliated third party.

          D. The General Partner, in its sole and absolute discretion and without the approval of the
Limited Partners, may propose and adopt on behalf of the Partnership employee benefit plans, stock
option plans, and similar plans funded by the Partnership for the benefit of employees of the
General Partner, the Partnership, Subsidiaries of the Partnership or any Affiliate of any of them
in respect of services performed, directly or indirectly, for the benefit of the Partnership, the
General Partner, or any of the Partnership’s Subsidiaries.

          E. The General Partner is expressly authorized to enter into, in the name and on behalf of the
Partnership, a right of first opportunity arrangement and other conflict avoidance agreements with
various Affiliates of the Partnership and the General Partner, on such terms as the General
Partner, in its sole and absolute discretion, believes are advisable.

          Section 7.7 Indemnification

          A. The Partnership shall indemnify each Indemnitee from and against any and all
losses, claims, damages, liabilities, joint or several, expenses (including, without
limitation, attorneys fees and other legal fees and expenses), judgments, fines, settlements, and
other amounts arising from any and all claims, demands, actions, suits or proceedings, civil,
criminal, administrative or investigative, that relate to the operations of the Partnership as set
forth in this Agreement in which such 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.
Without limitation, the foregoing indemnity shall extend to any liability of any Indemnitee,
pursuant to a loan guaranty or otherwise, for any indebtedness of the Partnership or any Subsidiary
of the Partnership (including without limitation, any indebtedness which the Partnership or any
Subsidiary of the Partnership has assumed or taken subject to) except as set forth in Exhibit F,
and the General Partner is hereby authorized and empowered, on behalf of the Partnership, to enter
into one or more indemnity agreements consistent with the provisions of this Section 7.7 in favor
of any Indemnitee having or potentially having liability for any such indebtedness. The termination
of any proceeding by judgment, order or settlement does not create a presumption that the
Indemnitee did not meet the requisite standard of conduct set forth in this Section 7.7.A with
respect to the subject matter of such proceeding. The termination of any proceeding by conviction
of an Indemnitee or upon a plea of nolo contendere or its equivalent by an Indemnitee, or an entry
of an order of probation against an Indemnitee prior to judgment, creates a rebuttable presumption
that such Indemnitee acted in a manner contrary to that
specified in this Section 7.7.A. Any indemnification pursuant to this

 

 

Section 7.7 shall be made only out of the assets of the Partnership, and neither the General
Partner nor any 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 7.7.

          B. Reasonable expenses incurred by an Indemnitee who is a party to a proceeding may be paid or
reimbursed by the Partnership 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 7.7.A has been met, and (ii) a written undertaking by or on behalf of the
Indemnitee to repay the amount if it shall ultimately be determined that the standard of conduct
has not been met.

          C. The indemnification provided by this Section 7.7 shall be in addition to any other rights
to which an Indemnitee or any other Person may be entitled under any agreement, pursuant to any
vote of the Partners, as a matter of law or otherwise, and shall continue as to an Indemnitee who
has ceased to serve in such capacity unless otherwise provided in a written agreement pursuant to
which such Indemnities is indemnified.

          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 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 7.7, 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 Section 7.7; 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
which is not opposed to the best interests of the Partnership.

          F. In no event may an Indemnitee subject any of the 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
7.7 because the Indemnitee had an interest in the transaction with respect to which the
indemnification applies if the transaction was otherwise permitted by the terms of this Agreement.

          H. The provisions of this Section 7.7 are for the benefit of the Indemnitees, their heirs,
successors, assigns and administrators and shall not be deemed to create any rights for the benefit
of any other Persons. Any amendment, modification or repeal of this Section 7.7 or any provision
hereof shall be prospective only and shall not in any way affect the limitations on the
Partnership’s liability to any Indemnitee under this Section 7.7 as in effect immediately prior to
such amendment, modification, or repeal with respect to claims arising from or relating to matters
occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when
such claims may arise or be asserted.

 

 

          Section 7.8 Liability of the General Partner

          A. Notwithstanding anything to the contrary set forth in this Agreement, the General Partner
shall not be liable for monetary damages to the Partnership, any Partners or any Assignees for
losses sustained or liabilities incurred as a result of errors in judgment or of any act or
omission if the General Partner acted in good faith.

          B. The Limited Partners expressly acknowledge that the General Partner is acting on behalf of
the Partnership, and its shareholders 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 Assignees) in deciding whether to cause the Partnership to take
(or decline to take) any actions, and that 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, provided that the General Partner has acted in good faith.

          C. Subject to its obligations and duties as General Partner set forth in Section 7.1.A hereof,
the General Partner may exercise any of the powers granted to it by this Agreement and perform any
of the duties imposed upon it hereunder either directly or by or through its agents. The General
Partner shall not be responsible for any misconduct or negligence on the part of any such agent
appointed by the General Partner in good faith.

          D. Any amendment, modification or repeal of this Section 7.8 or any provision hereof shall be
prospective only and shall not in any way affect the limitations on the General Partner’s
liability to the Partnership and the Limited Partners under this Section 7.8 as in effect
immediately prior to such amendment, modification or repeal with respect to claims arising from or
relating to matters occurring, in whole or in part, prior to such amendment, modification or
repeal, regardless of when such claims may arise or be asserted.

          Section 7.9 Other Matters Concerning the General Partner

          A. The General Partner may rely and shall be protected in acting or refraining from acting
upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent,
order, bond, debenture, or other paper or document believed by it in good faith to be genuine and
to have been signed or presented by the proper party or parties.

          B. The General Partner may consult with legal counsel, accountants, appraisers, management
consultants, investment bankers, architects, engineers, environmental consultants and other
consultants and advisers selected by it, and any act taken or omitted to be taken in reliance upon
the opinion of such Persons as to matters which such General Partner reasonably believes to be
within such Person’s professional or expert competence shall be conclusively presumed to have been
done or omitted in good faith and in accordance with such opinion.

          C. The General Partner shall have the right, in respect of any of its powers or obligations
hereunder, to act through any of its duly authorized officers and a duly appointed attorney or
attorneys-in-fact. Each such attorney shall, to the extent provided by the General Partner in the
power of attorney, have full power and authority to do and perform all and every act and duty which
is permitted or required to be done by the General Partner hereunder.

 

 

          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 to (i) protect the ability of the General Partner to
continue to qualify as a REIT or (ii) avoid the General Partner’s incurring any taxes under Section
857 or Section 4981 of the Code, is expressly authorized under this Agreement and is deemed
approved by all of the Limited Partners.

          Section 7.10 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 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.

          Section 7.11 Reliance by Third Parties

          Notwithstanding anything to the contrary in this Agreement, any Person dealing with the
Partnership shall be entitled to assume that the General Partner has full power and authority,
without consent or approval of any other Partner or Person to encumber, sell or otherwise use in
any manner any and all assets of the Partnership and to enter into any contracts on behalf of the
Partnership, and take any and all actions on behalf of the Partnership and such Person shall be
entitled to deal with the General Partner as if the General Partner were the Partnership’s sole
party in interest, both legally and beneficially. Each Limited Partner hereby waives any and all
defenses or other remedies which may be available against such Person to contest, negate or
disaffirm any action of the General Partner in connection with any such dealing. In no event shall
any Person dealing with the General Partner or its representatives be obligated to ascertain that
the terms of this Agreement have been complied with or to inquire into the necessity or expedience
of any act or action of the General Partner or its representatives. Each and every certificate,
document or other instrument executed on behalf of the Partnership by the General Partner or its
representatives shall be conclusive evidence in favor of any and every Person relying thereon or
claiming thereunder that (i) at the time of the execution and delivery of such certificate,
document or instrument, this Agreement was in full force and effect, (ii) the Person executing and
delivering such certificate, document or instrument was duly authorized and empowered to do so for
and on behalf of the Partnership and (iii) such certificate, document or instrument was duly
executed and delivered in accordance with the terms and provisions of this Agreement and is binding
upon the Partnership.

 

 

ARTICLE 8

RIGHTS AND OBLIGATIONS OF LIMITED PARTNERS

          Section 8.1 Limitation of Liability

          The Limited Partners shall have no liability under this Agreement except as expressly provided
in this Agreement, including Section 10.5 hereof, or under the Act.

          Section 8.2 Management of Business

          No Limited Partner or Assignee (other than the General Partner, any of its Affiliates or any
officer, director, employee, partner, agent or trustee of the General Partner, the Partnership or
any of their Affiliates, in their capacity as such) shall take part in the operation, management or
control (within the meaning of the Act) of the Partnership’s business, transact any business in the
Partnership’s name or have the power to sign documents for or otherwise bind the Partnership. The
transaction of any such business by the General Partner, any of its Affiliates or any officer,
director, employee, partner, agent or trustee of the General Partner, the Partnership or any of
their Affiliates, in their capacity as such, shall not affect, impair or eliminate the limitations
on the liability of the Limited Partners or Assignees under this Agreement.

          Section 8.3 Outside Activities of Limited Partners

          Subject to any agreements entered into pursuant to Section 7.6.E hereof and any other
agreements entered into by a Limited Partner or its Affiliates with the Partnership or a
Subsidiary, any Limited Partner (other than the General Partner) and any officer, director,
employee, agent, trustee, Affiliate or shareholder of any Limited Partner (other than the General
Partner) shall be entitled to and may have business interests and engage in business
activities in addition to those relating to the Partnership, including business interests and
activities that are in direct competition with the Partnership or that are enhanced by the
activities of the Partnership. Neither the Partnership nor any Partners shall have any rights by
virtue of this Agreement in any business ventures of any Limited Partner or Assignee. None of the
Limited Partners (other than the General Partner) nor any other Person shall have any rights by
virtue of this Agreement or the Partnership relationship established hereby in any business
ventures of any other Person (other than the General Partner to the extent expressly provided
herein) and such Person shall have no obligation pursuant to this Agreement to offer any interest
in any such business ventures to the Partnership, any Limited Partner or any such other Person,
even if such opportunity is of a character which, if presented to the Partnership, any Limited
Partner or such other Person, could be taken by such Person.

          Section 8.4 Return of Capital

          Except pursuant to the right of redemption set forth in Section 8.6, no Limited Partner shall
be entitled to the withdrawal or return of its Capital Contribution, except to the extent of
distributions made pursuant to this Agreement or upon termination of the Partnership as provided
herein. Except to the extent provided by Exhibit C hereof or as permitted by Section 4.2.B, or
otherwise expressly provided in this Agreement, no Limited Partner or Assignee shall have priority
over any other Limited Partner or Assignee either as to the return of Capital Contributions or as
to profits, losses or distributions.

 

 

          Section 8.5 Rights of Limited Partners Relating to the Partnership

          A. In addition to other rights provided by this Agreement or by the Act, and except as limited
by Section 8.5.C hereof, each Limited Partner shall have the right, for a purpose reasonably
related to such Limited Partner’s interest as a limited partner in the Partnership, upon written
demand with a statement of the purpose of such demand and at such Limited Partner’s own expense
(including such copying and administrative charges as the General Partner may establish from time
to time):

	 	(1)	 	to obtain a copy of the most recent annual and quarterly reports filed
with the Securities and Exchange Commission by the General Partner
pursuant to the Securities Exchange Act of 1934;
	 
	 	(2)	 	to obtain a copy of the Partnership’s federal, state and local income
tax returns for each Partnership Year;
	 
	 	(3)	 	to obtain a current list of the name and last known business,
residence or mailing address of each Partner;
	 
	 	(4)	 	to obtain a copy of this Agreement and the Certificate and all
amendments thereto, together with executed copies of all powers of
attorney pursuant to which this Agreement, the Certificate and all
amendments thereto have been executed; and
	 
	 	(5)	 	to obtain true and full information regarding the amount of cash and a
description and statement of any other property or services contributed by
each Partner and which each Partner has agreed to contribute in the
future, and the date on which each became a Partner.

          B. The Partnership shall notify each Limited Partner upon request of the then current
Conversion Factor.

          C. Notwithstanding any other provision of this Section 8.5, the General Partner may keep
confidential from the Limited Partners, for such period of time as the General Partner determines
in its sole and absolute discretion to be reasonable, any information that (i) the General Partner
reasonably believes to be in the nature of trade secrets or other information the disclosure of
which the General Partner in good faith believes is not in the best interests of the Partnership or
could damage the Partnership or its business or (ii) the Partnership is required by law or by
agreements with an unaffiliated third party to keep confidential.

          Section 8.6 Redemption Right

          A. Subject to Sections 4.2.C.3 and 8.6.C, on or after the date one (1) year after the closing
of the initial public offering of REIT Shares by the General Partner, each Limited Partner, other
than the General Partner, shall have the right (the “Redemption Right”) to require the Partnership
to redeem on a Specified Redemption Date all or a portion of the Class A Units held by such Limited
Partner at a redemption price equal to and in the form of the Cash Amount to be paid by the
Partnership. The Redemption Right shall be exercised pursuant to a Notice of Redemption delivered
to the Partnership (with a copy to the General Partner) by the Limited Partner who is exercising
the redemption right (the “Redeeming Partner”). A Limited Partner may not exercise the Redemption
Right for less than one thousand (1,000) Class A Units or, if such

 

 

Limited Partner holds less than one thousand (1,000) Class A Units, all of the Class A Units held
by such Limited Partner. The Redeeming Partner shall have no right, with respect to any Partnership
Units so redeemed, to receive any distributions paid after the Specified Redemption Date. The
Assignee of any Limited Partner may exercise the rights of such Limited Partner pursuant to this
Section 8.6, and such Limited Partner shall be deemed to have assigned such rights to such Assignee
and shall be bound by the exercise of such rights by such Limited Partner’s Assignee. In connection
with any exercise of such rights by such Assignee on behalf of such Limited Partner, the Cash
Amount shall be paid by the Partnership directly to such Assignee and not to such Limited Partner.

          B. Notwithstanding the provisions of Section 8.6.A, the General Partner may, in its sole and
absolute discretion, elect to assume directly and satisfy a Redemption Right by either paying to
the Redeeming Partner the Cash Amount or issuing to the Redeeming Partner the REIT Shares Amount,
as elected by the General Partner (in its sole and absolute discretion) on the Specified Redemption
Date, whereupon the General Partner shall acquire the Partnership Units offered for redemption by
the Redeeming Partner and shall be treated for all purposes of this Agreement as the owner of such
Class A Units. Unless the General Partner (in its sole and absolute discretion) shall exercise its
right to assume directly and satisfy the Redemption Right, the General Partner shall not have any
obligation to the Redeeming Partner or the Partnership with respect to the Redeeming Partner’s
exercise of the Redemption Right. In the event the General Partner shall exercise its right to
satisfy the Redemption Right in the manner described in the first sentence of this Section 8.6.B,
the Partnership shall have no obligation to pay any amount to the Redeeming Partner with respect to
such Redeeming Partner’s exercise of the Redemption Right, and each of the Redeeming Partner, the
Partnership, and the General Partner shall treat the transaction between the General Partner, and the Redeeming
Partner for federal income tax purposes as a sale of the Redeeming Partner’s Class A Units to the
General Partner. Each Redeeming Partner agrees to execute such documents as the General Partner may
reasonably require in connection with the issuance of REIT Shares upon exercise of the Redemption
Right.

          C. Notwithstanding the provisions of Section 8.6.A and Section 8.6.B, a Partner shall not be
entitled to exercise the Redemption Right pursuant to Section 8.6.A if the delivery of REIT Shares
to such Partner on the Specified Redemption Date by the General Partner pursuant to Section 8.6.B
(regardless of whether or not the General Partner or would in fact exercise its rights under
Section 8.6.B) would be prohibited under the Declaration of Trust. Without limitation on the
preceding sentence, the following restrictions shall apply to the exercise of a Redemption Right by
a Partner: (i) neither a Person who is an “Excluded Holder” as defined in the Declaration of Trust,
nor any Person related to an “Excluded Holder” by either blood or marriage, nor any Person whose
ownership of REIT Shares would be attributed to an “Excluded Holder” under Section 318 of the Code,
nor any Person who would be considered by reason of the application of Section 318 of the Code to
own REIT Shares actually or constructively owned by an “Excluded Holder” shall be permitted to
exercise the Redemption Right if (A) after giving effect to such exercise, The Colonial Company or
any direct or indirect Subsidiary of The Colonial Company would be regarded as a “related party
tenant” of the General Partner for purposes of Section 856(d)(2)(B) of the Code and (B) the total
rental income considered derived by the General Partner from all “related party tenants” could
reasonably be expected to exceed one percent (1%) of the gross income of the General Partner (as
determined for the purposes of Section 856(c)(2) of the Code); and (ii) neither an “Excluded
Holder”, nor any Person related to an “Excluded Holder” by either blood or marriage, nor any Person whose
ownership of REIT Shares would be attributed to an “Excluded Holder” under Section 544(a) of the

 

 

Code, nor any Person who would be considered by reason of the application of Section 544(a) of the
Code to own REIT Shares actually or constructively owned by an “Excluded Holder” shall be permitted
to exercise the Redemption Right if, after giving effect to such exercise (A) any single Person
described above would be considered to own more than 29 percent of the outstanding REIT Shares (as
determined for purposes of Sections 542(a)(2) and 856(a)(6) of the Code); (B) any two Persons
described above would be considered to own more than 34 percent of the outstanding REIT Shares (as
determined for purposes of Sections 542(a)(2) and 856(a)(6) of the Code); (C) any three Persons
described above would be considered to own more than 39 percent of the outstanding REIT Shares (as
determined for purposes of Sections 542(a)(2) and 856(a)(6) of the Code); or (D) any four Persons
described above would be considered to own more than 44 percent of the outstanding REIT Shares (as
determined for purposes of Sections 542(a)(2) and 856(a)(6) of the Code).

          D. Notwithstanding anything contained in Sections 8.6.A, 8.6.B, or 8.6.C, no Partner shall be
entitled to exercise the Redemption Right pursuant to Section 8.6.A with respect to any Preferred
Unit unless (i) such Preferred Unit has been issued to and is held by a Partner other than the
General Partner, and (ii) the General Partner has expressly granted to such Partner the right to
redeem such Preferred Units pursuant to Section 8.6.A.

          E. Preferred Units shall be redeemed, if at all, only in accordance with such redemption
rights or options as are set forth with respect to such Preferred Units (or class or series
thereof) in the instruments designating such Preferred Units (or class or series thereof).

ARTICLE 9

BOOKS, RECORDS, ACCOUNTING AND REPORTS

          Section 9.1 Records and Accounting

          The General Partner shall keep or cause to be kept at the principal office of the Partnership
those records and documents required to be maintained by the Act and other books and records deemed
by the General Partner to be appropriate with respect to the Partnership’s business, including,
without limitation, all books and records necessary to provide to the Limited Partners any
information, lists and copies of documents required to be provided pursuant to Section 9.3 hereof.
Any records maintained by or on behalf of the Partnership in the regular course of its business may
be kept on, or be in the form of, punch cards, magnetic tape, photographs, micrographics or any
other information storage device, provided that the records so maintained are convertible into
clearly legible written form within a reasonable period of time. The books of the Partnership shall
be maintained, for financial and tax reporting purposes, on an accrual basis in accordance with
generally accepted accounting principles, or such other basis as the General Partner determines to
be necessary or appropriate.

          Section 9.2 Fiscal Year

          The fiscal year of the Partnership shall be the calendar year.

          Section 9.3 Reports

          A. As soon as practicable, but in no event later than one hundred five (105) days after the
close of each Partnership Year, the General Partner shall cause to be mailed to each Limited
Partner as of the close of the Partnership Year, an annual report containing financial statements
of the Partnership, or of the General Partner if such statements are prepared solely on

 

 

a consolidated basis with the General Partner, for such Partnership Year, presented in accordance
with generally accepted accounting principles, such statements to be audited by a nationally
recognized firm of independent public accountants selected by the General Partner.

          B. As soon as practicable, but in no event later than one hundred five (105) days after the
close of each calendar quarter (except the last calendar quarter of each year), the General Partner
shall cause to be mailed to each Limited Partner as of the last day of the calendar quarter, a
report containing unaudited financial statements of the Partnership, or of the General Partner, if
such statements are prepared solely on a consolidated basis with the General Partner, and such
other information as may be required by applicable law or regulation, or as the General Partner
determines to be appropriate.

ARTICLE 10

TAX MATTERS

          Section 10.1 Preparation of Tax Returns

          The General Partner shall arrange for the preparation and timely filing of all returns of
Partnership income, gains, deductions, losses and other items required of the Partnership for
federal and state income tax purposes and shall use all reasonable efforts to furnish, within
ninety (90) days of the close of each taxable year, the tax information reasonably required by
Limited Partners for federal and state income tax reporting purposes.

          Section 10.2 Tax Elections

          Except as otherwise provided herein, the General Partner shall, in its sole and absolute
discretion, determine whether to make any available election pursuant to the Code; provided,
however, that the General Partner shall make the election under Section 754 of the Code in
accordance with applicable regulations thereunder. The General Partner shall have the right to
seek to revoke any such election (including, without limitation, the election under Section 754 of
the Code) upon the General Partner’s determination in its sole and absolute discretion that such
revocation is in the best interests of the Partners.

          Section 10.3 Tax Matters Partner

          A. The General Partner shall be the “tax matters partner” of the Partnership for federal
income tax purposes. Pursuant to Section 6230(e) of the Code, upon receipt of notice from the IRS
of the beginning of an administrative proceeding with respect to the Partnership, the tax matters
partner shall furnish the IRS with the name, address, taxpayer identification number, and profit
interest of each of the Limited Partners and the Assignees; provided, however, that such
information is provided to the Partnership by the Limited Partners and the Assignees.

          B. The tax matters partner is authorized, but not required:

	 	(1)	 	to enter into any settlement with the IRS with respect to any administrative or
judicial proceedings for the adjustment of Partnership items required to be taken into
account by a Partner for income tax purposes (such

 

 

	 	 	 	administrative proceedings being referred to as a “tax audit” and such
judicial proceedings being referred to as “judicial review”), and in the
settlement agreement the tax matters partner may expressly state that
such agreement shall bind all Partners, except that such settlement
agreement shall not bind any Partner (i) who (within the time prescribed
pursuant to the Code and Regulations) files a statement with the IRS
providing that the tax matters partner shall not have the authority to
enter into a settlement agreement on behalf of such Partner or (ii) who
is a “notice partner” (as defined in Section 6231(a)(8) of the Code) or
a member of a “notice group” (as defined in Section 6223(b)(2) of the
Code);

	 	(2)	 	in the event that a notice of a final administrative adjustment at the Partnership
level of any item required to be taken into account by a Partner for tax purposes (a
“final adjustment”) is mailed to the tax matters partner, to seek judicial review of
such final adjustment, including the filing of a petition for readjustment with the
Tax Court or the filing of a complaint for refund with the United States Claims Court
or the District Court of the United States for the district in which the Partnership’s
principal place of business is located;
	 
	 	(3)	 	to intervene in any action brought by any other Partner for judicial review of a
final adjustment;
	 
	 	(4)	 	to file a request for an administrative adjustment with the IRS and, if any part
of such request is not allowed by the IRS, to file an appropriate pleading
(petition or complaint) for judicial review with respect to such request;
	 
	 	(5)	 	to enter into an agreement with the IRS to extend the period for assessing any tax
which is attributable to any item required to be taken account by a Partner for tax
purposes, or an item affected by such item; and
	 
	 	(6)	 	to take any other action on behalf of the Partners of the Partnership in
connection with any tax audit or judicial review proceeding to the extent permitted by
applicable law or regulations.

          The taking of any action and the incurring of any expense by the tax matters partner in
connection with any such proceeding, except to the extent required by law, is a matter in the sole
and absolute discretion of the tax matters partner and the provisions relating to indemnification
of the General Partner set forth in Section 7.7 of this Agreement shall be fully applicable to the
tax matters partner in its capacity as such.

          C. The tax matters partner shall receive no compensation for its services. All third party
costs and expenses incurred by the tax matters partner in performing its duties as such (including
legal and accounting fees and expenses) shall be borne by the Partnership. Nothing herein shall be
construed to restrict the Partnership from engaging an accounting firm to assist the tax matters
partner in discharging its duties hereunder, so long as the compensation paid by the Partnership
for such services is reasonable.

 

 

          Section 10.4 Organizational Expenses
 

          The Partnership shall elect to deduct expenses, if any, incurred by it in organizing the
Partnership ratably over a sixty (60) month period as provided in Section 709 of the Code.

          Section 10.5 Withholding

          Each Limited Partner hereby authorizes the Partnership to withhold from or pay on behalf of or
with respect to such Limited Partner any amount of federal, state, local, or foreign taxes that the
General Partner determines that the Partnership is required to withhold or pay with respect to any
amount distributable or allocable to such Limited Partner pursuant to this Agreement, including,
without limitation, any taxes required to be withheld or paid by the Partnership pursuant to
Sections 1441, 1442, 1445, or 1446 of the Code. Any amount paid on behalf of or with respect to a
Limited Partner shall constitute a loan by the Partnership to such Limited Partner, which loan
shall be repaid by such Limited Partner within fifteen (15) days after notice from the General
Partner that such payment must be made unless (i) the Partnership withholds such payment from a
distribution which would otherwise be made to the Limited Partner or (ii) the General Partner
determines, in its sole and absolute discretion, that such payment may be satisfied out of the
available funds of the Partnership which would, but for such payment, be distributed to the Limited
Partner. Any amounts withheld pursuant to the foregoing clauses (i) or (ii) shall be treated as
having been distributed to such Limited Partner. Each Limited Partner hereby unconditionally and
irrevocably grants to the Partnership a security interest in such Limited Partner’s Partnership
Interest to secure such Limited Partner’s obligation to pay to the Partnership any amounts required
to be paid pursuant to this Section 10.5. In the event that a Limited Partner fails to pay any
amounts owed to the Partnership pursuant to this Section 10.5 when due, the General Partner may, in
its sole and absolute discretion, elect to make the payment to
the Partnership on behalf of such defaulting Limited Partner, and in such event shall be
deemed to have loaned such amount to such defaulting Limited Partner and shall succeed to all
rights and remedies of the Partnership as against such defaulting Limited Partner. Without
limitation, in such event the General Partner shall have the right to receive distributions that
would otherwise be distributable to such defaulting Limited Partner until such time as such loan,
together with all interest thereon, has been paid in full, and any such distributions so received
by the General Partner shall be treated as having been distributed to the defaulting Limited
Partner and immediately paid by the defaulting Limited Partner to the General Partner in repayment
of such loan. Any amounts payable by a Limited Partner hereunder shall bear interest at the lesser
of (A) the base rate on corporate loans at large United States money center commercial banks, as
published from time to time in the Wall Street Journal, plus four (4) percentage points, or (B) the
maximum lawful rate of interest on such obligation, such interest to accrue from the date such
amount is due (i.e., fifteen (15) days after demand) until such amount is paid in full. Each
Limited Partner shall take such actions as the Partnership or the General Partner shall request in
order to perfect or enforce the security interest created hereunder.

 

 

ARTICLE 11

TRANSFERS AND WITHDRAWALS

          Section 11.1 Transfer

          A. The term “transfer,” when used in this Article 11 with respect to a Partnership Unit, shall
be deemed to refer to a transaction by which the General Partner purports to assign all or any part
of its General Partner Interest to another Person or by which a Limited Partner purports to assign
all or any part of its Limited Partner Interest to another Person, and includes a sale, assignment,
gift, pledge, encumbrance, hypothecation, mortgage, exchange or any other disposition by law or
otherwise. The term “transfer” when used in this Article 11 does not include any redemption of
Partnership Units by a Limited Partner or acquisition of Partnership Units from a Limited Partner
by the General Partner pursuant to Section 8.6.

          B. No Partnership Interest shall be transferred, in whole or in part, except in accordance
with the terms and conditions set forth in this Article 11. Any transfer or purported transfer of a
Partnership Interest not made in accordance with this Article 11 shall be null and void.

          Section 11.2 Transfer of General Partner’s Partnership Interest

          A. The General Partner may not transfer any of its General Partner Interest or Limited
Partnership Interests or withdraw as General Partner except as provided in Section 11.2.B or in
connection with a transaction described in Section 11.2.C.

          B. The General Partner may transfer Limited Partner Interests held by it either to the
Partnership in accordance with Section 7.5.B hereof or to a purported holder of REIT Shares in
accordance with the provisions of Section 6.6 of the Declaration of Trust.

          C. Except as otherwise provided in Section 11.2.D, the General Partner 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, or any reclassification, or recapitalization or change of
outstanding REIT Shares (other than a change in par value, or from par value to no par value, or as
a result of a subdivision or combination as described in the definition of “Conversion Factor”)
(“Transaction”), unless (i) the Transaction also includes a merger of the Partnership or sale of
substantially all of the assets of the Partnership which has been approved by the requisite Consent
of the Partners pursuant to Section 7.3 and as a result of which all Limited Partners will receive
for each Common Unit an amount of cash, securities, or other property equal to the product of the
Conversion Factor and the greatest amount of cash, securities or other property paid to a holder of
one REIT Share in consideration of one REIT Share at any time during the period from and after the
date on which the Transaction is consummated, provided that if, in connection with the Transaction,
a purchase, tender or exchange offer shall have been made to and accepted by the holders of more
than fifty percent (50%) of the outstanding REIT Shares, each holder of Common Units shall receive
the greatest amount of cash, securities, or other property which such holder would have received
had it exercised the Redemption Right and received REIT Shares in exchange for its

 

 

Common Units immediately prior to the expiration of such purchase, tender or exchange offer and had
thereupon accepted such purchase, tender or exchange offer; and (ii) no more than forty-nine
percent (49%) of the equity securities of the acquiring Person in such transaction shall be owned,
after consummation of such Transaction, by the General Partner or Persons who are Affiliates of the
Partnership or the General Partner immediately prior to the date on which the Transaction is
consummated.

          D. Notwithstanding Section 11.2.C, the General Partner may merge with another entity if
immediately after such merger substantially all of the assets of the surviving entity, other than
Partnership Units held by the General Partner (whether such Partnership Units constitute the
General Partner Interest or a Limited Partner Interest), are contributed to the Partnership as a
Capital Contribution in exchange for Partnership Units with a fair market value, as reasonably
determined by the General Partner, equal to the 704(c) Value of the assets so contributed.

          Section 11.3 Limited Partners’ Rights to Transfer

          A. Subject to the provisions of Sections 11.3.C, 11.3.D, 11.3.E, and 11.4, a Limited Partner
may transfer, with or without the consent of the General Partner, all or any portion of its
Partnership Interest, or any of such Limited Partner’s economic rights as a Limited Partner.

          B. If a Limited Partner is subject to Incapacity, the executor, administrator, trustee,
committee, guardian, conservator or receiver of such Limited Partner’s estate shall have all the
rights of a Limited Partner, but not more rights than those enjoyed by other Limited Partners, for
the purpose of settling or managing the estate and such power as the Incapacitated Limited Partner
possessed to transfer all or any part of his or its interest in the Partnership. The Incapacity of a Limited Partner, in and of itself, shall
not dissolve or terminate the Partnership.

          C. The General Partner may prohibit any transfer by a Limited Partner of its Partnership Units
if, in the opinion of legal counsel to the Partnership, such transfer would require filing of a
registration statement under the Securities Act of 1933 or would otherwise violate any federal or
state securities laws or regulations applicable to the Partnership or the Partnership Unit.

          D. No transfer by a Limited Partner of its Partnership Units may be made to any Person if (i)
in the opinion of legal counsel for the Partnership, it would result in the Partnership being
treated as an association taxable as a corporation, or (ii) such transfer is effectuated through an
“established securities market” or a “secondary market (or the substantial equivalent thereof)”
within the meaning of Section 7704 of the Code.

          E. No transfer of any Partnership Units may be made to a lender to the Partnership or any
Person who is related (within the meaning of Section 1.752-4(b) of the Regulations) to any lender
to the Partnership whose loan constitutes a Nonrecourse Liability, without the consent of the
General Partner, in its sole and absolute discretion, provided that as a condition to such consent
the lender will be required to enter into an arrangement with the Partnership and the General
Partner to exchange or redeem for the Cash Amount or REIT Shares Amount, at the election of the
Partnership, any Partnership Units in which a security interest is held simultaneously with the
time at which such lender would be deemed to be a partner in the Partnership for purposes of
allocating liabilities to such lender under Section 752 of the Code.

 

 

          Section 11.4 Substituted Limited Partners

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

          B. A transferee who has been admitted as a Substituted Limited Partner in accordance with this
Article 11 shall have all the rights and powers and be subject to all the restrictions and
liabilities of a Limited Partner under this Agreement.

          C. Upon the admission of a Substituted Limited Partner, the General Partner shall amend
Exhibit A to reflect the name, address, number of Partnership Units, and Percentage Interest of
such Substituted Limited Partner and to eliminate or adjust, if necessary, the name, address and
interest of the predecessor of such Substituted Limited Partner.

          Section 11.5 Assignees

          If the General Partner, in its sole and absolute discretion, does not consent to the admission
of any permitted transferee under Section 11.3 as a Substituted Limited Partner, as described in
Section 11.4, such transferee shall be considered an Assignee for purposes of this Agreement. An
Assignee shall be deemed to have had assigned to it, and shall be entitled to receive distributions
from the Partnership and the share of Net Income, Net Losses, Recapture Income, and any other
items, gain, loss deduction and credit of the Partnership attributable to the Partnership Units
assigned to such transferee, but shall not be deemed to be a holder of Partnership Units for any
other purpose under this Agreement, and shall not be entitled to vote such Partnership Units in any
matter presented to the Limited Partners for a vote (such Partnership Units being deemed to have
been voted on such matter in the same proportion as all other Partnership Units of the same class
or series held by Limited Partners are voted, to the extent such Partnership Units are entitled to vote on such matter). In the event any such
transferee desires to make a further assignment of any such Partnership Units, such transferee
shall be subject to all the provisions of this Article 11 to the same extent and in the same manner
as any Limited Partner desiring to make an assignment of Partnership Units.

          Section 11.6 General Provisions

          A. No Limited Partner may withdraw from the Partnership other than as a result of a permitted
transfer of all of such Limited Partner’s Partnership Units in accordance with this Article 11 or
pursuant to redemption of all of its Partnership Units under Section 8.6.

          B. Any Limited Partner who shall transfer all of its Partnership Units in a transfer permitted
pursuant to this Article 11 shall cease to be a Limited Partner upon the admission of all Assignees
of such Partnership Units as Substitute Limited Partners. Similarly, any Limited Partner who shall
transfer all of its Partnership Units pursuant to a redemption of all of its Partnership Units
under Section 8.6 of this Agreement, Section 4 of Exhibit I and Section 4 of Exhibit J shall cease
to be a Limited Partner.

          C. Transfers pursuant to this Article 11 may only be made on the first day of a month, unless
the General Partner otherwise agrees; provided, however, that a transfer of Partnership Units
pursuant to exercise of rights by a secured party in connection with a pledge of such Partnership
Units may occur at any time.

 

 

          D. If any Partnership Interest is transferred or assigned during any quarterly segment of the
Partnership’s fiscal year in compliance with
 the provisions of this Article 11 or redeemed or transferred pursuant to Section 8.6 of this
Agreement, Section 4 of Exhibit G or Section 4 of Exhibit H, or any day other than the first day of
a Partnership Year, then Net Income, Net Losses, each item thereof and all other items attributable
to such interest for such Partnership Year shall be divided and allocated between the transferor
Partner and the transferee Partner by taking into account their varying interests during the
Partnerships year in accordance with Section 706(d) of the Code, using the interim closing of the
books method. Solely for purposes of making such allocations, each of such items for the calendar
month in which the transfer or assignment occurs shall be allocated to the transferee Partner, and
none of such items for the calendar month in which a redemption occurs shall be allocated to the
Redeeming Partner. All distributions of Available Cash attributable to such Partnership Unit with
respect to which the Partnership Record Date or the Series B Preferred Unit Partnership Record
Date, as the case may be, is before the date of such transfer, assignment, or redemption shall be
made to the transferor Partner or the Redeeming Partner, as the case may be, and in the case of a
transfer or assignment other than a redemption, all distributions of Available Cash thereafter
attributable to such Partnership Unit shall be made to the transferee Partner.

ARTICLE 12

ADMISSION OF PARTNERS

          Section 12.1 Admission of Successor General Partner

          A successor to all of the General Partner Interest pursuant to Section 11.2 hereof who is
proposed to be admitted as a successor General Partner shall be admitted to the Partnership as the
General Partner, effective upon such transfer. Any such transferee shall carry on
the business of the Partnership without dissolution. In each case, the admission shall be
subject to the successor General Partner executing and delivering to the Partnership an acceptance
of all of the terms and conditions of this Agreement and such other documents or instruments as may
be required to effect the admission. In the case of such admission on any day other than the first
day of a Partnership Year, all items attributable to the General Partner Interest for such
Partnership year shall be allocated between the transferring General Partner and such successor as
provided in Section 11.6.D hereof.

          Section 12.2 Admission of Additional Limited Partners

          A. A Person who makes a Capital Contribution to the Partnership in accordance with this
Agreement shall be admitted to the Partnership as an Additional Limited Partner only upon
furnishing to the General Partner (i) evidence of acceptance in form satisfactory to the General
Partner of all of the terms and conditions of this Agreement, including, without limitation, the
power of attorney granted in Section 2.4 hereof and (ii) such other documents or instruments as may
be required in the discretion of the General Partner in order to effect such Person’s admission as
an Additional Limited Partner.

          B. Notwithstanding anything to the contrary in this Section 12.2, no Person shall be admitted
as an Additional Limited Partner without the consent of the General Partner, which consent may be
given or withheld in the General Partner’s sole and absolute discretion. The admission of any
Person as an Additional Limited Partner shall become effective on the date upon which the name of
such Person is recorded on the books and records of the Partnership, following the consent of the
General Partner to such admission.

 

 

          C. If any Additional Limited Partner is admitted to the
 Partnership on any day other than the first day of a Partnership Year, then Net Income, Net Losses,
each item thereof and all other items allocable among Partners and Assignees for such Partnership
Year shall be allocated among such Additional Limited Partner and all other Partners and Assignees
by taking into account their varying interests during the Partnership Year in accordance with
Section 706(d) of the Code, using the interim closing of the books method. Solely for purposes of
making such allocations, each of such item for the calendar month in which an admission of any
Additional Limited Partner occurs shall be allocated among all the Partners and Assignees including
such Additional Limited Partner. All distributions of Available Cash with respect to which the
Partnership Record Date is before the date of such admission shall be made solely to Partners and
Assignees other than the Additional Limited Partner, and all distributions of Available Cash
thereafter shall be made to all of the Partners and Assignees including such Additional Limited
Partner.

          Section 12.3 Amendment of Agreement and Certificate of Limited Partnership

          For the admission to the Partnership of any Partner, the General Partner shall take all steps
necessary and appropriate under the Act to amend the records of the Partnership and, if necessary,
to prepare as soon as practical an amendment of this Agreement (including an amendment of Exhibit
A) and, if required by law, shall prepare and file an amendment to the Certificate and may for this
purpose exercise the power of attorney granted pursuant to Section 2.4 hereof.

ARTICLE 13

DISSOLUTION, LIQUIDATION AND TERMINATION

          Section 13.1 Dissolution

          The Partnership shall not be dissolved by the admission of Substituted Limited Partners or
Additional Limited Partners or by the admission of a successor General Partner in accordance with
the terms of this Agreement. Upon the withdrawal of the General Partner, any successor General
Partner shall continue the business of the Partnership. The Partnership shall dissolve, and its
affairs shall be wound up, upon the first to occur of any of the following (“Liquidating Events”):

          A. the expiration of its term as provided in Section 2.5 hereof;

          B. an event of withdrawal of the General Partner, as defined in the Act (other than an event
of bankruptcy), unless, within ninety (90) days after such event of withdrawal all the remaining
Partners agree in writing to continue the business of the Partnership and to the appointment,
effective as of the date of withdrawal, of a successor General Partner;

          C. from and after the Effective Date through December 31, 2013, an election to dissolve the
Partnership made by the General Partner, unless any Original Limited Partner who holds one or more
Original Limited Partnership Units objects in writing to such dissolution within thirty (30) days
of receiving written notice of such election from the General Partner;

          D. from and after January 1, 2014 through December 31, 2043, an election to dissolve the
Partnership made by the General Partner, unless Original Limited Partners holding at least five
percent (5%) of the Original Limited Partnership Units object in writing to such dissolution within
thirty (30) days of receiving written notice of such election from the General Partner;

 

 

          E. on or after January 1, 2043 an election to dissolve the Partnership made by the General
Partner, in its sole and absolute discretion;

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

          G. the sale of all or substantially all of the assets and properties of the Partnership; or

          H. a final and non-appealable judgment is entered by a court of competent jurisdiction ruling
that the General Partner is bankrupt or insolvent, or a final and non-appealable order for relief
is entered by a court with appropriate jurisdiction against the General Partner, in each case under
any federal or state bankruptcy or insolvency laws as now or hereafter in effect, unless prior to
the entry of such order or judgment all of the remaining Partners agree in writing to continue the
business of the Partnership and to the appointment, effective as of a date prior to the date of
such order or judgment, of a substitute General Partner.

          Section 13.2 Winding Up

          A. Upon the occurrence of a Liquidating Event, the Partnership shall continue solely for the
purposes of winding up its affairs in an orderly manner, liquidating its assets, and satisfying the
claims of its creditors and Partners. No Partner shall take any action that is inconsistent with,
or not necessary to or appropriate for, the winding up of the Partnership’s business and affairs.
The General Partner, or, in the event there is no remaining General Partner, any Person elected by
a majority in interest of the Limited Partners (the General Partner or such other Person being
referred to herein as the “Liquidator”), shall be responsible for overseeing the winding up and
dissolution of the Partnership and shall take full account of the Partnership’s liabilities and property and
the Partnership property shall be liquidated as promptly as is consistent with obtaining the fair
value thereof, and the proceeds therefrom (which may, to the extent determined by the General
Partner, include shares of stock in the General Partner) shall be applied and distributed in the
following order:

	 	(1)	 	First, to the payment and discharge of all of the Partnership’s debts and
liabilities to creditors other than the Partners;
	 
	 	(2)	 	Second, to the payment and discharge of all of the Partnership’s debts and
liabilities to the General Partner;
	 
	 	(3)	 	Third, to the payment and discharge of all of the Partnership’s debts and
liabilities to the other Partners; and
	 
	 	(4)	 	The balance, if any, to the General Partner and Limited Partners in accordance
with their Capital Accounts, after giving effect to all
contributions, distributions,
adjustments, and allocations for all periods, and subject to the rights of the holders
of Preferred Units to receive a liquidation preference, with an appropriate adjustment
to the Capital Accounts of such holders entitled to receive a liquidation preference
to reflect the payment of any such liquidation preference.

 

 

Prior to the foregoing distributions, the General Partner shall have made adjustments to Capital Accounts of the Partners to reflect the fair market value of the Partnership
assets as of the date of the Partnership’s liquidation in a manner consistent with Regulations
Section 1.704-1(b)(2)(iv)(f).

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

          B. Notwithstanding the provisions of Section 13.2.A hereof which require liquidation of the
assets of the Partnership, but subject to the order of priorities set forth therein, if prior to or
upon dissolution of the Partnership the Liquidator determines that an immediate sale of part or all
of the Partnership’s assets would be impractical or would cause undue loss to the Partners, the
Liquidator may, in its sole and absolute discretion, defer for a reasonable time the liquidation of
any assets except those necessary to satisfy liabilities of the Partnership (including to those
Partners as creditors) and/or distribute to the Partners, in lieu of cash, as tenants in common and
in accordance with the provisions of Section 13.2.A hereof, undivided interests in such Partnership
assets as the Liquidator deems not suitable for liquidation. Any such distributions in kind shall
be made only if, in the good faith judgment of the Liquidator, such distributions in kind are in
the best interest of the Partners, and shall be subject to such conditions relating to the
disposition and management of such properties as the Liquidator deems reasonable and equitable and
to any agreements governing the operation of such properties at such time. The Liquidator shall
determine the fair market value of any property distributed in kind using such reasonable method of
valuation as it may adopt.

          C. In the discretion of the Liquidator, a pro rata portion of the distributions that would
otherwise be made to the General Partner and Limited Partners
pursuant to this Article 13 may be:

	 	(1)	 	distributed to a trust established for the benefit of the General
Partner and Limited Partners for the purposes of liquidating Partnership
assets, collecting amounts owed to the Partnership, and paying any
contingent or unforeseen liabilities or obligations of the Partnership or
of the General Partner arising out of or in connection with the
Partnership. The assets of any such trust shall be distributed to the
General Partner and Limited Partners from time to time, in the reasonable
discretion of Liquidator, in the same proportions as the amount
distributed to such trust by the Partnership would otherwise have been
distributed to the General Partner and Limited Partners Pursuant to this
Agreement; or

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

          Section 13.3 Compliance with Timing Requirements of Regulations

          In the event the Partnership is “liquidated” within the meaning of Regulations Section
1.704-1(b)(2)(ii)(g), distributions shall be made

 

 

pursuant to this Article 13 to the General Partner and Limited Partners who have positive Capital
Accounts in compliance with Regulations Section 1.704-1(b)(2)(ii)(b)(2). If any Partner has a
deficit balance in his Capital Account (after giving effect to all contributions, distributions and
allocations for all taxable years, including the year during which such liquidation occurs), such
Partner shall have no obligation to make any contribution to the capital of the Partnership with
respect to such deficit, and such deficit shall not be considered a debt owed to the Partnership or
to any other Person for any purpose whatsoever.

          Section 13.4. Deemed Distribution and Recontribution

          Notwithstanding any other provision of this Article 13, in the event the Partnership is
considered liquidated within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g) but no
Liquidating Event has occurred, the Partnership’s property shall not be liquidated, the
Partnership’s liabilities shall not be paid or discharged, and the Partnership’s affairs shall not
be wound up. Instead, for federal income tax purposes and for purposes of maintaining Capital
Accounts pursuant to Exhibit B hereto, the Partnership shall be deemed to have distributed the
property in kind to the General Partner and Limited Partners, who shall be deemed to have assumed
and taken such property subject to all Partnership liabilities, all in accordance with their
respective Capital Accounts. Immediately thereafter, the General Partner and Limited Partners shall
be deemed to have recontributed the Partnership property in kind to the Partnership, which shall be
deemed to have assumed and taken such property subject to all such liabilities.

          Section 13.5 Rights of Limited Partners

          Except as otherwise provided in this Agreement, each Limited Partner shall look solely to the
assets of the Partnership for the return of its Capital Contributions and shall have no right or
power to demand or receive property other than cash from the Partnership. Except as otherwise
provided in this Agreement, no Limited Partner shall have priority over any other Partner as to the
return of its Capital Contributions, distributions, or allocations.

          Section 13.6 Notice of Dissolution

          In the event a Liquidating Event occurs or an event occurs that would, but provisions of an
election or objection by one or more Partners pursuant to Section 13.1, result in a dissolution of
the Partnership, the General Partner shall, within thirty (30) days thereafter, provide written
notice thereof to each of the Partners.

          Section 13.7 Termination of Partnership and Cancellation of Certificate of Limited Partnership

          Upon the completion of the liquidation of the Partnership cash and property as provided in
Section 13.2 hereof, the Partnership shall be terminated, a certificate of cancellation shall be
filed, and all qualifications of the Partnership as a foreign limited partnership in jurisdictions
other than the State of Delaware shall be canceled and such other actions as may be necessary to
terminate the Partnership shall be taken.

          Section 13.8 Reasonable Time for Winding-Up

          A reasonable time shall be allowed for the orderly winding-up of the business and affairs of
the Partnership and the liquidation of its assets pursuant to Section 13.2 hereof, in order to
minimize any losses otherwise attendant upon such winding-up, and the provisions of this Agreement shall remain in effect between the Partners during the period of liquidation.

 

 

          Section 13.9 Waiver of Partition

          Each Partner hereby waives any right to partition of the Partnership property.

ARTICLE 14

AMENDMENT OF PARTNERSHIP AGREEMENT; MEETINGS

          Section 14.1 Amendments

          A. Amendments to this Agreement may be proposed by the General Partner or by any Limited
Partners holding twenty percent (20%) or more of the outstanding Common Units. Following such
proposal, the General Partner shall submit any proposed amendment to the Limited Partners. The
General Partner shall seek the written vote of the Partners on the proposed amendment or shall call
a meeting to vote thereon and to transact any other business that it may deem appropriate. For
purposes of obtaining a written vote, the General Partner may require a response within a
reasonable specified time, but not less than fifteen (15) days, and failure to respond in such time
period shall constitute a vote which is consistent with the General Partner’s recommendation with
respect to the proposal. Except as provided in Section 14.1.B, 14.1.C or 14.1.D, a proposed
amendment shall be adopted and be effective as an amendment hereto if it is approved by the General
Partner and it receives the Consent of Partners holding a majority of the outstanding Common Units
(including Common Units held by the General Partner).

          B. Notwithstanding Section 14.1.A, the General Partner shall have the power, without the
consent of the Limited Partners, to amend this Agreement as may be required to facilitate or
implement any of the following purposes:

	 	(1)	 	to add to the obligations of the General Partner or surrender any right or power
granted to the General Partner or any Affiliate of the General Partner for the benefit
of the Limited Partners;
	 
	 	(2)	 	to reflect the admission, substitution, termination, or
withdrawal of Partners in accordance with this Agreement;
	 
	 	(3)	 	to set forth the designations, rights, powers, duties, and preferences of the
holders of any additional Partnership Interests issued pursuant to Section 4.2.A
hereof;
	 
	 	(4)	 	to reflect a change that is of an inconsequential nature and does not adversely
affect the Limited Partners in any material respect, or to cure any ambiguity, correct
or supplement any provision in this Agreement not inconsistent with law or with other
provisions, or make other changes with respect to matters arising under this Agreement
that will not be inconsistent with law or with the provisions of this Agreement; and
	 
	 	(5)	 	to satisfy any requirements, conditions, or guidelines contained in any order,
directive, opinion, ruling or regulation of a federal or state agency or contained in
federal or state law.

 

 

The General Partner shall provide notice to the Limited Partners when any action under this Section
14.1.B is taken.

          C. Notwithstanding Section 14.1.A and 14.1.B hereof, this Agreement shall not be amended
without the Consent of each Partner adversely affected if such amendment would (i) convert a
Limited Partner’s interest in the Partnership into a general partner interest, (ii) modify the
limited liability of a Limited Partner in a manner adverse to such Limited Partner, (iii) alter
rights of the Partner to receive distributions pursuant to Article 5, or the allocations specified
in Article 6 (except as permitted pursuant to Section 4.2 and Section 14.1.B(3) hereof), (iv) alter
or modify the Redemption Right and REIT Shares Amount as set forth in Sections 8.6 and 11.2.B, and
the related definitions, in a manner adverse to such Partner, (v) cause the termination of the
Partnership prior to the time set forth in Sections 2.5 or 13.1, or (vi) amend this Section 14.1.C.
Further, no amendment may alter the restrictions on the General Partner’s authority set forth in
Section 7.3 without the Consent specified in that section.

          D. Notwithstanding Section 14.1.A or Section 14.1.B hereof, the General Partner shall not
amend Sections 4.2.A, 7.5, 7.6, 11.2 or 14.2 without the Consent of a majority of the Percentage
Interests in Common Units held by the Limited Partners, excluding Limited Partner Interests held by
the General Partner in Common Units.

          Section 14.2 Meetings of the Partners

          A. Meetings of the Partners may be called by the General Partner and shall be called upon the
receipt by the General Partner of a written request by Limited Partners holding twenty percent
(20%) or more of the outstanding Common Units. The call shall state the nature of the business to
be transacted. Notice of any such meeting shall be given to all Partners not less than seven (7) days nor more than thirty (30)
days prior to the date of such meeting. Partners may vote in person or by proxy at such meeting.
Whenever the vote or Consent of the Partners is permitted or required under this Agreement, such
vote or Consent may be given at a meeting of the Partners or may be given in accordance with the
procedure prescribed in Section 14.1.A hereof. Except as otherwise expressly provided in this
Agreement, the Consent of holders of a majority of the Percentage Interests in Common Units held by
Limited Partners (including Limited Partnership Interests held by the General Partner) shall
control.

          B. Any action required or permitted to be taken at a meeting of the Partners may be taken
without a meeting if a written consent setting forth the action so taken is signed by a majority of
the Percentage Interests of the Partners (or such other percentage as is expressly required by this
Agreement). Such consent may be in one instrument or in several instruments, and shall have the
same force and effect as a vote of a majority of the Percentage Interests of the Partners (or such
other percentage as is expressly required by this Agreement). Such consent shall be filed with the
General Partner. An action so taken shall be deemed to have been taken at a meeting held on the
effective date so certified.

          C. Each Limited Partner may authorize any Person or Persons to act for him by proxy on all
matters in which a Limited Partner is entitled to participate, including waiving notice of any
meeting, or voting or participating at a meeting. Every proxy must be signed by the Limited Partner
or his attorney-in-fact. No proxy shall be valid after the expiration of eleven (11) months from
the date thereof unless otherwise provided in the proxy. Every proxy

 

 

shall be revocable at the pleasure of the Limited Partner executing it, such revocation to be
effective upon the Partnership’s receipt of or written notice such revocation from the Limited
Partner executing such proxy.

          D. Each meeting of Partners shall be conducted by the General Partner or such other Person as
the General Partner may appoint pursuant to such rules for the conduct of the meeting as the
General Partner or such other Person deems appropriate. Without limitation, meetings of Partners
may be conducted in the same manner as meetings of the shareholders of the General Partner and may
be held at the same time, and as part of, meetings of the shareholders of the General Partner.

ARTICLE 15

GENERAL PROVISIONS

          Section 15.1 Addresses and Notice

          Any notice, demand, request or report required or permitted to be given or made to a Partner
or Assignee under this Agreement shall be in writing and shall be deemed given or made when
delivered in person or when sent by first class United States mail or by other means of written
communication to the Partner or Assignee at the address set forth in Exhibit A or such other
address of which the Partner shall notify the General Partner in writing.

          Section 15.2 Titles and Captions

          All article or section titles or captions in this Agreement are for convenience only. They
shall not be deemed part of this Agreement and in no way define, limit, extend or describe the
scope or intent of any provisions hereof. Except as specifically provided otherwise, references to
“Articles” and “Sections” are to Articles and Sections of this Agreement.

          Section 15.3 Pronouns and Plurals

          Whenever the context may require, any pronoun used in this Agreement shall include the
corresponding masculine, feminine or neuter forms, and the singular form of nouns, pronouns and
verbs shall include the plural and vice versa.

          Section 15.4 Further Action

          The parties shall execute and deliver all documents, provide all information and take or
refrain from taking action as may be necessary or appropriate to achieve the purposes of this
Agreement.

          Section 15.5 Binding Effect

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

          Section 15.6 Creditors

          Other than as expressly set forth herein with respect to the Indemnitees, none of the
provisions of this Agreement shall be for the benefit of, or shall be enforceable by, any creditor
of the Partnership.

 

 

          Section 15.7 Waiver

          No failure by any party to insist upon the strict performance of any covenant, duty, agreement
or condition of this Agreement or to exercise any right or remedy consequent upon a breach thereof
shall constitute waiver of any such breach or any other covenant, duty, agreement or condition.

          Section 15.8 Counterparts

          This Agreement may be executed in counterparts, all of which together shall constitute one
agreement binding on all the parties hereto, notwithstanding that all such parties are not
signatories to the original or the same counterpart. Each party shall become bound by this
Agreement immediately upon affixing its signature hereto.

          Section 15.9 Applicable Law

          This Agreement shall be construed and enforced in accordance with and governed by the laws of
the State of Delaware, without regard to the principles of conflicts of law.

          Section 15.10 Invalidity of Provisions

          If any provision of this Agreement is or becomes invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions contained herein
shall not be affected thereby.

          Section 15.11 Entire Agreement

          This Agreement contains the entire understanding and agreement among the Partners with respect
to the subject matter hereof and supersedes the Prior Agreement and any other prior written or oral
understandings or agreements among them with respect thereto.

          Section 15.12 HUD Limitations

          As long as the Secretary of Housing and Urban Development, or his successors or assigns
(“HUD”), is the insurer or holder of the mortgage loans (the “HUD Mortgages”) relating to the real
property consisting of the two apartment projects known as Pointe West Apartments and Ashford Place
Apartments located at 1601 Hillcrest Road, Mobile, Alabama and 6075 Grelot Road, Mobile, Alabama,
respectively (the “Mitchell Properties”), that are encumbered by the two Regulatory Agreements for
Multi-Family Housing Projects that are recorded in Book 2179, Page 760 and Book 2617, Page 207 in
the Probate Office of Mobile County, Alabama (the “Regulatory Agreements”), no amendment to the
Partnership Agreement which results in any of the following shall be of force and effect, without
the prior written consent of HUD: (i) any amendment which modifies the duration of the Partnership
Agreement; (ii) any amendment which results in the requirement that a Form 92530 HUD Prior
Participation Certificate be obtained for any additional party; and (iii) any amendment which in
any way impacts or affects the HUD Mortgages or the

 

 

Regulatory Agreements. In addition, as long as HUD is the insurer or holder of the HUD Mortgages
relating to the Mitchell Properties, upon any dissolution of the Partnership, no title or right to
possession and control of the Mitchell Properties, and no right to collect the rents therefrom,
shall pass to any person who is not bound by the terms of the HUD Mortgages or the Regulatory
Agreements in a manner satisfactory to HUD.

 

 

          IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first
written above.

	 	 	 	 	 
	 	GENERAL PARTNER:

Colonial Properties Trust,

an Alabama real estate investment trust

 	 
	 	 	/s/ Howard B. Nelson, Jr.
 	 
	 	By:                       	Howard B. Nelson, Jr. 	 
	 	Title:  	Chief Financial Officer and Secretary 	 
	 

	 	 	 	 	 
	 	LIMITED PARTNERS:
 	 
	 	By:  	Colonial Properties Trust
 	 
	 	 	as Attorney-in-Fact for the 	 
	 	 	Limited Partners 	 
	 

	 	 	 	 	 
	 	 	 
	 	 	                                 /s/ Howard B. Nelson, Jr.
 	 
	 	By:	Howard B. Nelson, Jr. 	 
	 	Title:  	Chief Financial Officer and Secretary 	 
	 

 

 

FIFTH AMENDMENT TO

THIRD AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

OF

COLONIAL REALTY LIMITED PARTNERSHIP

          THIS FIFTH AMENDMENT TO THIRD AMENDED AND RESTATED AGREEMENT
OF LIMITED PARTNERSHIP OF COLONIAL REALTY LIMITED PARTNERSHIP (this “Fifth
Amendment” to the “Partnership Agreement”), dated as of June 4, 2001, is
entered into by Colonial Properties Trust, as general partner (the “General
Partner”) of Colonial Realty Limited Partnership (the “Partnership”), for itself
and on behalf of the limited partners of the Partnership (the “Limited
Partners”).

          WHEREAS, Section 4.2.A of the Partnership Agreement
authorizes the General Partner to cause the Partnership to issue additional
Partnership Units in one or more classes or series, with such designations,
preferences and relative, participating, optional or other special rights,
powers and duties as shall be determined by the General Partner in its sole and
absolute discretion, subject to the condition that no such additional
Partnership Units shall be issued to the General Partner unless (i) the
additional Partnership Units are issued in connection with an issuance of shares
by the General Partner, which shares have designations, preferences and other
rights, substantially similar to the designations, preferences and other rights
of the additional Partnership Units issued to the General Partner and (ii) the
General Partner makes a capital contribution of an amount equal to the net
proceeds raised in connection with the issuance of such shares.

          WHEREAS, General Partner has entered into an Underwriting
Agreement dated as of June 4, 2001, and a Terms Agreement dated as of June 4,
2001, pursuant to which Colonial Properties has agreed to issue up to 2,300,000
9.25% Series C Cumulative Redeemable Preferred Shares of Beneficial Interest,
par value $0.01 per share (the “Series C Preferred Shares”), of Colonial
Properties;

          WHEREAS, General Partner will make will make a capital
contribution to the Partnership of the proceeds from the issuance of the Series
C Preferred Shares in exchange for up to 2,300,000 Series C Preferred Units (as
defined below); and

          WHEREAS, in connection with the issuance of the Series C
Preferred Shares and pursuant to the authority granted to the General Partner
pursuant to Section 4.2.A of the Partnership Agreement, the General Partner
desires to amend the Partnership Agreement (i) to establish a new class of
Units, to be entitled Series C Cumulative Redeemable Preferred Units (the
“Series C Preferred Units”), and to set forth the designations, rights, powers,
preferences and duties of such Series C Preferred Units, which are substantially
the same as those of the Series C Preferred Shares, and (ii) to make certain
other changes to the Partnership Agreement.

          NOW, THEREFORE, in consideration of the premises and for other
good and valuable consideration, the receipt and sufficiency of which hereby are
acknowledged, the General Partner hereby amends the Partnership Agreement, as
follows:

          1. Section 4.2 of the Partnership Agreement is hereby
amended by adding after Section 4.2.F the following section:

     G. Series C Preferred Units. Under the
authority granted to it by Section 4.2.A hereof, the General
Partner hereby establishes and designates as Preferred Units
an additional class of Partnership Units entitled “Series C
Cumulative Redeemable Preferred Units” (the “Series C
Preferred Units”). Series C Preferred Units shall have the
designations, preferences, rights, powers and duties as set
forth in Exhibit J hereto.

 

 

          2. Exhibits to Partnership Agreement.

          The Partnership Agreement is hereby amended by attaching
thereto as Exhibit J the Exhibit J attached hereto.

          3. Certain Capitalized Terms. All capitalized terms used
in this Fifth Amendment and not otherwise defined shall have the meanings
assigned in the Partnership Agreement. Except as modified herein, all terms and
conditions of the Partnership Agreement shall remain in full force and effect,
which terms and conditions the General Partner hereby ratifies and affirms.

          IN WITNESS WHEREOF, the undersigned has executed this Fifth
Amendment as of the date first set forth above.

	 	 	 	 	 	 	 
	 	 	COLONIAL PROPERTIES TRUST,

as General Partner

of Colonial Realty Limited Partnership

And on behalf of existing Limited Partners	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Howard B. Nelson, Jr.
 

Howard B. Nelson, Jr.
	 	 
	 

	 	Title:
	 	Chief Financial Officer and Secretary	 	 

 

 

Exhibit J

DESIGNATION OF THE PREFERENCES, RIGHTS, VOTING POWERS,

RESTRICTIONS, QUALIFICATIONS AND LIMITATIONS

OF THE

SERIES C PREFERRED UNITS

     The Series C Preferred Units shall have the following designations,
preferences, rights, powers and duties:

     (1) Certain Defined Terms. The following capitalized
terms used in this Exhibit I shall have the respective meanings set
forth below:

     “Distribution Period” means quarterly periods commencing on or
about the first day of June, April, July and October of each year and
ending on and including the day preceding the first day of the next
succeeding Distribution Period (other than the initial Distribution
Period, which shall commence on June 19, 2001 and end on September 30,
2001, and other than the Distribution Period during which any Series C
Preferred Units shall be redeemed pursuant to Section 4, which shall
end on and include the date of such redemption).

     “Fully Junior Units” shall mean the Common Units and any other
class or series of Partnership Units now or hereafter issued and
outstanding over which the Series C Preferred Units have a preference
or priority in both (i) the payment of distributions and (ii) the
distribution of assets on any liquidation, dissolution or winding up of
the Partnership.

     “Junior Units” shall mean the Common Units and any other class
or series of Partnership Units now or hereafter issued and outstanding
over which the Series C Preferred Units have a preference or priority
in the payment of distributions or in the distribution of assets on any
liquidation, dissolution or winding up of the Partnership.

     “Parity Units” has the meaning ascribed thereto in Section
6(B).

     (2) Distributions.

     (A) The General Partner, in its capacity as the holder of
the then outstanding Series C Preferred Units, shall be entitled to
receive out of funds legally available therefor, distributions payable
in cash at the rate of $2.1325 per Series C Preferred Unit per year,
payable in equal amounts of $.533125 per unit quarterly in cash on the
last day of each March, June, September, and December or, if not a
Business Day, the next succeeding Business Day beginning on September
30, 2001 (each such day being hereafter called a “Quarterly
Distribution Date”). Quarterly distributions on each Series C Preferred
Unit shall begin to accrue and shall be fully cumulative from June 19,
2001, whether or not (i) quarterly distributions on such Series C
Preferred Unit are earned or declared or (ii) on any Quarterly
Distribution Date there shall be funds legally available for the
payment of quarterly distributions. Quarterly distributions paid on the
Series C Preferred Units in an amount less than the total amount of
such quarterly distributions at the time accrued and payable on such
Partnership Units shall be allocated pro rata on a per unit basis among
all such Series C Preferred Units. Accrued and unpaid distributions for
any past Distribution Periods may be declared and paid at any time and
for such interim periods, without reference to any regular Quarterly
Distribution Date, to the General Partner, on such date as may be fixed
by the General Partner for payment of the corresponding dividend on the
Series C Preferred Shares. Any distribution made on the Series C
Preferred Units shall first be credited against the earliest accrued
but unpaid distribution due with respect to Series C Preferred Units
which remains payable.

     (B) The amount of any quarterly distributions accrued on
any Series C Preferred Units at any Quarterly Distribution Date shall
be the amount of any unpaid quarterly distributions accumulated

I-1

 

thereon, to and including such Quarterly Distribution Date, whether or
not earned or declared. The amount of distribution for the initial
Distribution Period and any other Distribution Period on the Series C
Preferred Units that represents less than a full quarter of a year
shall be computed on the basis of a 360-day year of twelve 30-day
months. No interest, or sum of money in lieu of interest, shall be
payable in respect of any distribution payment or payments on the
Series C Preferred Units that may be in arrears.

     (C) So long as any Series C Preferred Units are
outstanding, no distributions, except as described in the immediately
following sentence, shall be declared or paid or set apart for payment
on any class or series of Parity Units for any period unless full
cumulative distributions have been or contemporaneously are declared
and paid or declared and a sum sufficient for the payment thereof set
apart for such payment on the Series C Preferred Units for all
Distribution Periods terminating on or prior to the distribution
payment date for such class or series of Parity Units. When
distributions are not paid in full or a sum sufficient for such payment
is not set apart, as aforesaid, all distributions declared upon Series
C Preferred Units and all distributions declared upon any other class
or series of Parity Units shall be declared ratably in proportion to
the respective amounts of distributions accumulated and unpaid on the
Series C Preferred Units and accumulated and unpaid on such Parity
Units.

     (D) So long as any Series C Preferred Units are
outstanding, no distributions (other than distributions paid solely in
Fully Junior Units or options, warrants or rights to subscribe for or
purchase Fully Junior Units) shall be declared or paid or set apart for
payment or other distribution shall be declared or made or set apart
for payment upon Junior Units, nor shall any Junior Units be redeemed,
purchased or otherwise acquired (other than a redemption, purchase or
other acquisition of Class A Units made for purposes of an employee
incentive or benefit plan of the General Partner or any subsidiary) for
any consideration (or any moneys be paid to or made available for a
sinking fund for the redemption of any such Junior Units) by the
Partnership, directly or indirectly (except by conversion into or
exchange for Fully Junior Units), unless in each case (i) the full
cumulative distributions on all outstanding Series C Preferred Units
and any other Parity Units of the Partnership shall have been paid or
declared and set apart for payment for all past Distribution Periods
with respect to the Series C Preferred Units and all past distribution
periods with respect to such Parity Units and (ii) sufficient funds
shall have been paid or set apart for the payment of the distribution
for the current Distribution Period with respect to the Series C
Preferred Units and the current distribution period with respect to
such Parity Units.

     (E) No distributions on the Series C Preferred Units
shall be paid or set apart for payment by the Partnership at such time
as the terms and provisions of any agreement of the General Partner or
the Partnership, including any agreement relating to indebtedness of
either of them, prohibits such declaration, payment, or setting apart
for payment or provides that such declaration, payment or setting apart
for payment would constitute a breach thereof or a default thereunder,
or if such declaration or payment shall be restricted or prohibited by
law.

     (F) Except as provided herein, the Series C Preferred
Units shall not be entitled to participate in the earnings or assets of
the Partnership, and no interest, or sum of money in lieu of interest,
shall be payable in respect of any distribution or distributions on the
Series C Preferred Units which may be in arrears.

     (3) Liquidation Preference.

          (A) In the event of any liquidation, dissolution
or winding up of the Partnership, whether voluntary or involuntary,
before any payment or distribution of the assets of the Partnership
shall be made to or set apart for the holders of Junior Units, the
General Partner, in its capacity as holder of the Series C Preferred
Units, shall be entitled to receive Twenty-Five Dollars ($25.00) (the
“Series C Liquidation Preference”) per Series C Preferred Unit plus an
amount equal to all distributions (whether or not earned or declared)
accrued and unpaid thereon to the date of

I-2

 

final distribution to the General Partner, in its capacity as such
holder; but the General Partner, in its capacity as the holder of
Series C Preferred Units shall not be entitled to any further payment
with respect to such Series C Preferred Units. If, upon any such
liquidation, dissolution or winding up of the Partnership, the assets
of the Partnership, or proceeds thereof, distributable to the General
Partner, in its capacity as the holder of Series C Preferred Units,
shall be insufficient to pay in full the preferential amount aforesaid
and liquidating payments on any other class or series of Parity Units,
then such assets, or the proceeds thereof, shall be distributed among
the General Partner, in its capacity as the holder of such Series C
Preferred Units, and the holders of such other Parity Units ratably in
accordance with the respective amounts that would be payable on such
Series C Preferred Units and such other Parity Units if all amounts
payable thereon were paid in full. For the purposes of this Section 3,
(x) a consolidation or merger of the Partnership or the General Partner
with one or more partnerships, limited liability companies,
corporations, real estate investment trusts or other entities and (y) a
sale, lease or conveyance of all or substantially all of the
Partnership’s property or business shall not be deemed to be a
liquidation, dissolution or winding up, voluntary or involuntary, of
the Partnership.

          (B) Subject to the rights of the holders of
Partnership Units of any series or class ranking on a parity with or
prior to the Series C Preferred Units upon any liquidation, dissolution
or winding up of the Partnership, after payment shall have been made in
full to the General Partner, in its capacity as the holder of the
Series C Preferred Units, as provided in this Section 3, any other
series or class or classes of Junior Units shall, subject to any
respective terms and provisions applying thereto, be entitled to
receive any and all assets remaining to be paid or distributed, and the
General Partner, in its capacity as the holder of the Series C
Preferred Units, shall not be entitled to share therein.

         4. Redemption Right.

          (A) Except as provided in Section 4(B), the
Series C Preferred Units shall not be redeemable prior to June 19,
2006. On and after June 19, 2006, the General Partner may cause the
Partnership to redeem the Series C Preferred Units, in whole or in
part, for cash in an amount per Series C Preferred Unit equal to the
Series C Liquidation Preference plus accrued and unpaid distributions
(the “Redemption Price”), in each case subject to the conditions set
forth below.

	 	(i)	 	The Series C Preferred Units shall be redeemed only
if the General Partner shall concurrently therewith
redeem an equivalent number of Series C Preferred
Shares for cash. Such redemption of Series C
Preferred Units shall occur substantially
concurrently with the redemption by the General
Partner of such Series C Preferred Shares (such date
of redemption the “Redemption Date”).
	 
	 	(ii)	 	In the event that the General Partner redeems Series
C Preferred Shares for cash, the Partnership shall
redeem a like number of Series C Preferred Units in
exchange for the amount of cash that the General
Partner is required to pay pursuant to the terms of
the Series C Preferred Shares in connection with such
redemption.
	 
	 	(iv)	 	Upon any redemption of Series C Preferred Units, the
Partnership shall pay any accrued and unpaid
distributions with respect to the Series C Preferred
Units being redeemed for any Distribution Period
ending on or prior to the Redemption Date. If the
Redemption Date falls after a Partnership Record Date
and prior to the corresponding Quarterly Distribution
Date, then the General Partner, in its capacity as
the holder of the Series C Preferred Units being
redeemed, shall be entitled to distributions payable
on the corresponding Quarterly Distribution Date
notwithstanding the redemption of such Series C
Preferred Units before such Quarterly Distribution
Date. Except as provided above, the Partnership shall
make no payment or allowance for unpaid
distributions, whether or not in arrears, on Series C
Preferred Units called for redemption.

I-3

 

          (B) In the event that the General Partner is
required to redeem any Series C Preferred Shares pursuant to the terms
thereof, the Partnership shall redeem an equivalent number of Series C
Preferred Units for consideration equal to the consideration payable by
the General Partner upon redemption of such Series C Preferred Shares.

          (C) The Series C Preferred Units have no stated
maturity and will not be subject to any sinking fund or mandatory
redemption provisions.

     5. Conversion. The Series C Preferred Units are not
convertible into or exchangeable for any other property or securities
of the Partnership.

     6. Ranking. Any class or series of Partnership Units
shall be deemed to rank:

          (A) prior to the Series C Preferred Units, as to
the payment of distributions and as to distribution of assets upon
liquidation, dissolution or winding up of the Partnership, if the
holders of such class or series of Partnership Units shall be entitled
to the receipt of distributions or of amounts distributable upon
liquidation, dissolution or winding up, as the case may be, in
preference or priority to the holders of Series C Preferred Units;

          (B) on a parity with the Series C Preferred
Units as to the payment of distributions and as to the distribution of
assets upon liquidation, dissolution or winding up of the Partnership,
whether or not the distribution rates, distribution payment dates or
redemption or liquidation prices per Partnership Unit be different from
those of the Series C Preferred Units, if the holders of such class or
series of Partnership Units and the Series C Preferred Units shall be
entitled to the receipt of distributions and of amounts distributable
upon liquidation, dissolution or winding up in proportion to their
respective amounts of accrued and unpaid distributions per Partnership
Unit or liquidation preferences, without preference or priority one
over the other (“Parity Units”);

          (C) junior to the Series C Preferred Units, as
to the payment of distributions or as to the distribution of assets
upon liquidation, dissolution or winding up of the Partnership, if such
class or series of Partnership Units shall be Junior Units; and

          (D) junior to the Series C Preferred Units, as
to the payment of distributions and as to the distribution of assets
upon liquidation, dissolution or winding up of the Partnership, if such
class or series of Partnership Units shall be Fully Junior Units;

     7. Voting. Except as required by law, the General
Partner, in its capacity as the holder of the Series C Preferred Units,
shall not be entitled to vote at any meeting of the Partners or for any
other purpose or otherwise to participate in any action taken by the
Partnership or the Partners, or to receive notice of any meeting of the
Partners.

     8. Restriction on Ownership. The Series C Preferred
Units shall be owned and held solely by the General Partner.

     9. General. The rights of the General Partner, in its
capacity as the holder of the Series C Preferred Units, are in addition
to and not in limitation on any other rights or authority of the
General Partner, in any other capacity, under the Agreement. In
addition, nothing contained in this Exhibit J shall be deemed to limit
or otherwise restrict any rights or authority of the General Partner
under the Agreement, other than in its capacity as the holder of the
Series C Preferred Units.

* * * * *

I-4

 

SIXTH AMENDMENT TO

THIRD AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

OF

COLONIAL REALTY LIMITED PARTNERSHIP

          THIS SIXTH AMENDMENT TO THIRD AMENDED AND RESTATED AGREEMENT
OF LIMITED PARTNERSHIP OF COLONIAL REALTY LIMITED PARTNERSHIP (this “Sixth
Amendment” to the “Partnership Agreement”), dated as of April 30, 2003, is
entered into by Colonial Properties Trust, as general partner (the “General
Partner”) of Colonial Realty Limited Partnership (the “Partnership”), for itself
and on behalf of the limited partners of the Partnership (the “Limited
Partners”).

          WHEREAS, Section 4.2.A of the Partnership Agreement authorizes
the General Partner to cause the Partnership to issue additional Partnership
Units in one or more classes or series, with such designations, preferences and
relative, participating, optional or other special rights, powers and duties as
shall be determined by the General Partner in its sole and absolute discretion,
subject to the condition that no such additional Partnership Units shall be
issued to the General Partner unless (i) the additional Partnership Units are
issued in connection with an issuance of shares by the General Partner, which
shares have designations, preferences and other rights, substantially similar to
the designations, preferences and other rights of the additional Partnership
Units issued to the General Partner and (ii) the General Partner makes a capital
contribution of an amount equal to the net proceeds raised in connection with
the issuance of such shares.

          WHEREAS, General Partner has entered into an Underwriting
Agreement dated as of April 3, 2003, and a Terms Agreement dated as of April 3,
2003, pursuant to which Colonial Properties has agreed to issue up to 500,000
Series D Cumulative Redeemable Preferred Shares of Beneficial Interest, par
value $0.01 per share (the “Series D Preferred Shares”), of Colonial Properties;

          WHEREAS, General Partner will make will make a capital
contribution to the Partnership of the proceeds from the issuance of the Series
D Preferred Shares in exchange for up to 500,000 Series D Preferred Units (as
defined below); and

          WHEREAS, in connection with the issuance of the Series D
Preferred Shares and pursuant to the authority granted to the General Partner
pursuant to Section 4.2.A of the Partnership Agreement, the General Partner
desires to amend the Partnership Agreement to establish a new class of Units, to
be entitled Series D Cumulative Redeemable Preferred Units (the “Series D
Preferred Units”), and to set forth the designations, rights, powers,
preferences and duties of such Series D Preferred Units, which are substantially
the same as those of the Series D Preferred Shares.

          NOW, THEREFORE, in consideration of the premises and for other
good and valuable consideration, the receipt and sufficiency of which hereby are
acknowledged, the General Partner hereby amends the Partnership Agreement, as
follows:

          1. Section 4.2 of the Partnership Agreement is hereby
amended by adding after Section 4.2.G the following section:

          H. Series D Preferred Units. Under the
authority granted to it by Section 4.2.A hereof, the General
Partner hereby establishes and designates as Preferred Units
an additional class of Partnership Units entitled “Series D
Cumulative Redeemable Preferred Units” (the “Series D
Preferred Units”). Series D Preferred Units shall have the
designations, preferences, rights, powers and duties as set
forth in Exhibit K hereto.

 

 

          2. Exhibits to Partnership Agreement.

          The Partnership Agreement is hereby amended by attaching
thereto as Exhibit K the Exhibit K attached hereto.

          3. Certain Capitalized Terms. All capitalized terms used
in this Sixth Amendment and not otherwise defined shall have the meanings
assigned in the Partnership Agreement. Except as modified herein, all terms and
conditions of the Partnership Agreement shall remain in full force and effect,
which terms and conditions the General Partner hereby ratifies and affirms.

          IN WITNESS WHEREOF, the undersigned has executed this Sixth
Amendment as of the date first set forth above.

	 	 	 	 	 	 	 
	 	 	COLONIAL PROPERTIES TRUST,

as General Partner of

Colonial Realty Limited Partnership	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Howard B. Nelson, Jr.
 

Howard B. Nelson, Jr.
	 	 
	 

	 	Title:
	 	Chief Financial Officer and Secretary	 	 

 

 

Exhibit K

DESIGNATION OF THE PREFERENCES, RIGHTS, VOTING POWERS, RESTRICTIONS,

QUALIFICATIONS AND LIMITATIONS

Of The

Series D Preferred Units

          The Series D Preferred Units shall have the following
designations, preferences, rights, powers and duties:

          (1) Certain Defined Terms. The following
capitalized terms used in this Exhibit K shall have the respective
meanings set forth below:

     “Distribution Period” means quarterly periods commencing on or
about the first day of February, May, August and November of each year
and ending on and including the day preceding the first day of the next
succeeding Distribution Period (other than the initial Distribution
Period, which shall commence on April 30, 2003 and end on July 31,
2003, and other than the Distribution Period during which any Series D
Preferred Units shall be redeemed pursuant to Section 4, which shall
end on and include the date of such redemption).

     “Fully Junior Units” shall mean the Common Units and any other
class or series of Partnership Units now or hereafter issued and
outstanding over which the Series D Preferred Units have a preference
or priority in both (i) the payment of distributions and (ii) the
distribution of assets on any liquidation, dissolution or winding up of
the Partnership.

     “Junior Units” shall mean the Common Units and any other class
or series of Partnership Units now or hereafter issued and outstanding
over which the Series D Preferred Units have a preference or priority
in the payment of distributions or in the distribution of assets on any
liquidation, dissolution or winding up of the Partnership.

     “Parity Units” has the meaning ascribed thereto in Section
6(B).

     (2) Distributions.

     (A) The General Partner, in its capacity as the holder of
the then outstanding Series D Preferred Units, shall be entitled to
receive out of funds legally available therefor, distributions payable
in cash at the rate of $20.3125 per Series D Preferred Unit per year,
payable in equal amounts of $5.078125 per unit quarterly in cash on the
last day of each January, April, July and October or, if not a Business
Day, the next succeeding Business Day beginning on July 31, 2003 (each
such day being hereafter called a “Quarterly Distribution Date”).
Quarterly distributions on each Series D Preferred Unit shall begin to
accrue and shall be fully cumulative from April 30, 2003. Quarterly
distributions paid on the Series D Preferred Units in an amount less
than the total amount of such quarterly distributions at the time
accrued and payable on such Partnership Units shall be allocated pro
rata on a per unit basis among all such Series D Preferred Units.
Accrued and unpaid distributions for any past Distribution Periods may
be declared and paid at any time and for such interim periods, without
reference to any regular Quarterly Distribution Date, to the General
Partner, on such date as may be fixed by the General Partner for
payment of the corresponding distribution on the Series D Preferred
Shares. Any distribution made on the Series D Preferred Units shall
first be credited against the earliest accrued but unpaid distribution
due with respect to Series D Preferred Units which remains payable.

K-1

 

     (B) The amount of any quarterly distributions accrued on
any Series D Preferred Units at any Quarterly Distribution Date shall
be the amount of any unpaid quarterly distributions accumulated
thereon, to and including such Quarterly Distribution Date. The amount
of distribution for the initial Distribution Period and any other
Distribution Period on the Series D Preferred Units that represents
less than a full quarter of a year shall be computed on the basis of a
360-day year of twelve 30-day months. No interest, or sum of money in
lieu of interest, shall be payable in respect of any distribution
payment or payments on the Series D Preferred Units that may be in
arrears.

     (C) So long as any Series D Preferred Units are
outstanding, no distributions, except as described in the immediately
following sentence, shall be paid or set apart for payment on any class
or series of Parity Units for any period unless full cumulative
distributions have been or contemporaneously are paid or declared and a
sum sufficient for the payment thereof set apart for such payment on
the Series D Preferred Units for all Distribution Periods terminating
on or prior to the distribution payment date for such class or series
of Parity Units. When distributions are not paid in full or a sum
sufficient for such payment is not set apart, as aforesaid, all
distributions payable or declared upon Series D Preferred Units and all
distributions payable or declared upon any other class or series of
Parity Units shall be declared or paid ratably in proportion to the
respective amounts of distributions accumulated and unpaid on the
Series D Preferred Units and accumulated and unpaid on such Parity
Units.

     (D) So long as any Series D Preferred Units are
outstanding, no distributions (other than distributions paid solely in
Fully Junior Units or options, warrants or rights to subscribe for or
purchase Fully Junior Units) shall be declared or paid or set apart for
payment or other distribution shall be declared or made or set apart
for payment upon Junior Units, nor shall any Junior Units be redeemed,
purchased or otherwise acquired (other than a redemption, purchase or
other acquisition of Class A Units made for purposes of an employee
incentive or benefit plan of the General Partner or any subsidiary) for
any consideration (or any moneys be paid to or made available for a
sinking fund for the redemption of any such Junior Units) by the
Partnership, directly or indirectly (except by conversion into or
exchange for Fully Junior Units), unless in each case (i) the full
cumulative distributions on all outstanding Series D Preferred Units
and any other Parity Units of the Partnership shall have been paid or
set apart for payment for all past Distribution Periods with respect to
the Series D Preferred Units and all past distribution periods with
respect to such Parity Units and (ii) sufficient funds shall have been
paid or declared and set apart for the payment of the distribution for
the current Distribution Period with respect to the Series D Preferred
Units and the current distribution period with respect to such Parity
Units.

     (E) No distributions on the Series D Preferred Units
shall be paid or set apart for payment by the Partnership at such time
as the terms and provisions of any agreement of the General Partner or
the Partnership, including any agreement relating to indebtedness of
either of them, prohibits such declaration, payment, or setting apart
for payment or provides that such declaration, payment or setting apart
for payment would constitute a breach thereof or a default thereunder,
or if such declaration or payment shall be restricted or prohibited by
law.

     (F) Except as provided herein, the Series D Preferred
Units shall not be entitled to participate in the earnings or assets of
the Partnership, and no interest, or sum of money in lieu of interest,
shall be payable in respect of any distribution or distributions on the
Series D Preferred Units which may be in arrears.

     (3) Liquidation Preference.

          (A) In the event of any liquidation, dissolution
or winding up of the Partnership, whether voluntary or involuntary,
before any payment or distribution of the assets of the Partnership
shall be made to or set apart for the holders of Junior Units, the
General Partner, in its capacity as holder of the Series D Preferred
Units, shall be entitled to receive Two Hundred and Fifty

K-2

 

Dollars ($250.00) (the “Series D Liquidation Preference”) per Series D
Preferred Unit plus an amount equal to all distributions accrued and
unpaid thereon to the date of final distribution to the General
Partner, in its capacity as such holder; but the General Partner, in
its capacity as the holder of Series D Preferred Units, shall not be
entitled to any further payment with respect to such Series D Preferred
Units. If, upon any such liquidation, dissolution or winding up of the
Partnership, the assets of the Partnership, or proceeds thereof,
distributable to the General Partner, in its capacity as the holder of
Series D Preferred Units, shall be insufficient to pay in full the
preferential amount aforesaid and liquidating payments on any other
class or series of Parity Units, then such assets, or the proceeds
thereof, shall be distributed among the General Partner, in its
capacity as the holder of such Series D Preferred Units, and the
holders of such other Parity Units ratably in accordance with the
respective amounts that would be payable on such Series D Preferred
Units and such other Parity Units if all amounts payable thereon were
paid in full. For the purposes of this Section 3, (x) a consolidation
or merger of the Partnership or the General Partner with one or more
partnerships, limited liability companies, corporations, real estate
investment trusts or other entities and (y) a sale, lease or conveyance
of all or substantially all of the Partnership’s property or business
shall not be deemed to be a liquidation, dissolution or winding up,
voluntary or involuntary, of the Partnership.

          (B) Subject to the rights of the holders of
Partnership Units of any series or class ranking on a parity with or
prior to the Series D Preferred Units upon any liquidation, dissolution
or winding up of the Partnership, after payment shall have been made in
full to the General Partner, in its capacity as the holder of the
Series D Preferred Units, as provided in this Section 3, any other
series or class or classes of Junior Units shall, subject to any
respective terms and provisions applying thereto, be entitled to
receive any and all assets remaining to be paid or distributed, and the
General Partner, in its capacity as the holder of the Series D
Preferred Units, shall not be entitled to share therein.

     4. Redemption Right. In connection with a redemption by
the General Partner of any or all of the Series D Preferred Shares, the
Partnership shall provide cash to the General Partner for such purpose
which shall be equal to redemption price of the Series D Preferred
Shares to be redeemed and one Series D Preferred Unit shall be canceled
with respect to each Series D Preferred Share so redeemed. From and
after the date in which the Series D Preferred Shares are redeemed, the
Series D Preferred Units so canceled shall no longer be outstanding and
all rights hereunder, to distributions or otherwise, with respect to
such Series D Preferred Units shall cease

     5. Conversion. The Series D Preferred Units are not
convertible into or exchangeable for any other property or securities
of the Partnership.

     6. Ranking. Any class or series of Partnership Units
shall be deemed to rank:

          (A) prior to the Series D Preferred Units as to
the payment of distributions and as to distribution of assets upon
liquidation, dissolution or winding up of the Partnership, if the
holders of such class or series of Partnership Units shall be entitled
to the receipt of distributions or of amounts distributable upon
liquidation, dissolution or winding up, as the case may be, in
preference or priority to the holders of Series D Preferred Units;

          (B) on a parity with the Series D Preferred
Units as to the payment of distributions and as to the distribution of
assets upon liquidation, dissolution or winding up of the Partnership,
whether or not the distribution rates, distribution payment dates or
redemption or liquidation prices per Partnership Unit be different from
those of the Series D Preferred Units, if the holders of such class or
series of Partnership Units and the Series D Preferred Units shall be
entitled to the receipt of distributions and of amounts distributable
upon liquidation, dissolution or winding up in proportion to their
respective amounts of accrued and unpaid distributions per Partnership
Unit or liquidation preferences, without preference or priority one
over the other (“Parity Units”);

K-3

 

          (C) junior to the Series D Preferred Units as to
the payment of distributions or as to the distribution of assets upon
liquidation, dissolution or winding up of the Partnership, if such
class or series of Partnership Units shall be Junior Units; and

          (D) junior to the Series D Preferred Units as to
the payment of distributions and as to the distribution of assets upon
liquidation, dissolution or winding up of the Partnership, if such
class or series of Partnership Units shall be Fully Junior Units.

     7. Voting. Except as required by law, the General
Partner, in its capacity as the holder of the Series D Preferred Units,
shall not be entitled to vote at any meeting of the Partners or for any
other purpose or otherwise to participate in any action taken by the
Partnership or the Partners, or to receive notice of any meeting of the
Partners.

     8. Restriction on Ownership. The Series D Preferred
Units shall be owned and held solely by the General Partner.

     9. Allocations. Allocations of the Partnership’s income,
gain, loss and deduction shall be allocated among holders of the Series
D Preferred Units in accordance with Article VI of the Agreement.

     10. General. The rights of the General Partner, in its
capacity as the holder of the Series D Preferred Units, are in addition
to and not in limitation on any other rights or authority of the
General Partner, in any other capacity, under the Agreement. In
addition, nothing contained in this Exhibit K shall be deemed to limit
or otherwise restrict any rights or authority of the General Partner
under the Agreement, other than in its capacity as the holder of the
Series D Preferred Units.

* * * * *

K-4

 

SEVENTH AMENDMENT TO

THIRD AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

OF

COLONIAL REALTY LIMITED PARTNERSHIP

          THIS SEVENTH AMENDMENT (this “Seventh Amendment”) TO THIRD
AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF COLONIAL REALTY LIMITED
PARTNERSHIP (as amended by Amendments dated as of January 5, 2000, as of January
25, 2000, as of August 28, 2000, as of April 17, 2001, as of June 19, 2001 and
as of April 30, 2003, collectively, the “Partnership Agreement”), dated as of
February 18, 2004, is entered into among Colonial Properties Trust, as general
partner (the “General Partner”) of Colonial Realty Limited Partnership (the
“Partnership”), for itself and on behalf of the limited partners of the
Partnership (the “Limited Partners”), and each of the holders of the Series B
Preferred Units.

     WHEREAS, the General Partner desires to, and each holder of Series B
Preferred Units desires to consent to, amend the Partnership Agreement to (i)
reduce the Priority Return with respect to the Series B Preferred Units, (ii)
amend the terms of the redemption rights with respect to the Series B Preferred
Units, and (iii) make the Series B Preferred Units callable on or after February
24, 2009.

     NOW, THEREFORE, in consideration of good and valuable consideration,
the receipt and sufficiency of which hereby are acknowledged, the General
Partner hereby amends the Partnership Agreement, as follows:

     1. Exhibits to Partnership Agreement. The Partnership Agreement
is hereby amended by deleting Exhibit H attached thereto and substituting
Exhibit H attached hereto therefor.

     2. Certain Capitalized Terms. All capitalized terms used in this
Seventh Amendment and not otherwise defined shall have the meanings assigned in
the Partnership Agreement. Except as modified herein, all terms and conditions
of the Partnership Agreement shall remain in full force and effect, which terms
and conditions the General Partner hereby ratifies and affirms.

     3. Approval. To the extent such approval or consent is required
pursuant to Section 5(b)(iii) of Exhibit H or any other provision of the
Partnership Agreement, each of the undersigned holders of Series B Preferred
Units, constituting 100% of the holders of the issued and outstanding Series B
Preferred Units, hereby approves and consents to the amendment of the
Partnership Agreement set forth in this Seventh Amendment.

[Signatures appear on following page]

 

 

     IN WITNESS WHEREOF, the undersigned has executed this Seventh Amendment
as of the date first set forth above.

	 	 	 	 	 	 	 
	 	 	COLONIAL PROPERTIES TRUST,

as General Partner of

Colonial Realty Limited Partnership	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Howard B. Nelson, Jr.
 

Howard B. Nelson, Jr.
	 	 
	 

	 	Title:
	 	Chief Financial Officer and Secretary	 	 
	 
	 	 	 	 	 	 
	 	 	Series B Preferred Unit Holders:	 	 
	 
	 	 	 	 	 	 
	 	 	BELAIR REAL ESTATE CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ William R. Cross
 

William R. Cross
	 	 
	 

	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	BELCREST REALTY CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ William R. Cross
 

William R. Cross
	 	 
	 

	 	Title:
	 	Vice President	 	 

 

 

EXHIBIT H

DESIGNATION OF THE PREFERENCES, RIGHTS, VOTING POWERS, RESTRICTIONS,

QUALIFICATIONS AND LIMITATIONS OF THE

SERIES B PREFERRED UNITS

     The Series B Preferred Units shall have the following designations,
preferences, rights, powers and duties:

          (1) DEFINITIONS. For purposes of this Amendment, (i) the
term “PARITY PREFERRED UNITS” shall be used to refer to any class or series of
Partnership Interests of the Partnership now or hereafter authorized, issued or
outstanding expressly designated by the Partnership to rank on a parity with
Series B Preferred Units (as hereinafter defined) with respect to distributions
and rights upon voluntary or involuntary liquidation, winding-up or dissolution
of the Partnership and include, without limitation, the Series C Preferred Units
(as defined in that certain Fifth Amendment to Third Amended and Restated
Agreement of Limited Partnership of the Partnership, dated as of June 19, 2001)
(the “SERIES C PREFERRED AMENDMENT”), the Series D Preferred Units (as defined
in that certain Sixth Amendment to Third Amended and Restated Agreement of
Limited Partnership of the Partnership, dated as of April 30, 2003) (the “SERIES
D PREFERRED AMENDMENT”), and any other class or series of Preferred Units that
by its terms ranks on a parity with respect to the Series C Preferred Units (as
defined in the Series C Preferred Amendment) or the Series D Preferred Units (as
defined in the Series D Preferred Amendment), (ii) the term “PRIORITY RETURN”
shall mean, an amount equal to 8.875% per annum up to and including February 23,
2004, and 7.25% per annum from and after February 24, 2004, in each case
determined on the basis of a 360 day year of twelve 30 day months (or actual
days for any month which is shorter than a full monthly period), cumulative to
the extent not distributed for any given distribution period pursuant to Section
5.1 of the Partnership Agreement, of the stated value of $50 per Series B
Preferred Unit, commencing on the date of issuance of such Series B Preferred
Unit, (iii) the term “SUBSIDIARY” shall mean with respect to any person, any
corporation, partnership, limited liability company, joint venture or other
entity of which a majority of (x) voting power of the voting equity securities
or (y) the outstanding equity interests, is owned, directly or indirectly, by
such person, (iv) the term “PTP” shall mean a “publicly traded partnership”
within the meaning of Section 7704 of the Code, and (v) the term “RIGHTS” shall
mean those rights granted pursuant to that certain Rights Agreement, dated as of
November 2, 1998 between General Partner and BankBoston, N.A. Capitalized terms
used herein and not otherwise defined herein shall have the meanings ascribed to
them in the Partnership Agreement.

          (2) Distributions.

          (a) Payment of Distributions. Subject to the rights of holders
of Parity Preferred Units as to the payment of distributions, pursuant to
Section 5.1 of the Partnership Agreement, holders of Series B Preferred Units
shall be entitled to receive, when, as and if declared by the Partnership acting
through the General Partner, out of Available Cash, cumulative preferential cash
distributions at the rate per annum of 8.875% of the original Capital
Contribution per Series B Preferred Unit for the period up to and including
February 23, 2004, and at the rate per annum of 7.25% of the original Capital
Contribution per Series B Preferred Unit for the period from and after February
24, 2004. Such distributions shall be cumulative, shall accrue from the original
date of issuance and will be payable (i) quarterly (such quarterly periods for
purposes of payment and accrual will be the quarterly periods ending on the
dates specified in this sentence and not calendar year quarters) in arrears, on
March 31, June 30, September 30 and December 31 of each year commencing on March
31, 1999 and, (ii) in the event of (A) an exchange of Series B Preferred Units
into Series B Preferred Shares (as hereinafter defined), or (B) a redemption of
Series B Preferred Units, on the exchange date or redemption date, as applicable
(each a “SERIES B PREFERRED UNIT DISTRIBUTION PAYMENT DATE”). The holders of the
Series B Preferred Units acknowledge that all quarterly distributions have been
made through and including the quarterly period ended December 31, 2003. The
amount of the distribution payable for any period will be computed on the basis
of a 360-day year of twelve 30-day months (or actual days for any month which is
shorter than a full monthly period), and for any period shorter than a full
quarterly period for which distributions are computed, the amount of the
distribution payable will be computed on the basis of the actual number of days
elapsed in such a 30-day month. The amount of the distribution payable on March
31, 2004 under the Partnership Agreement and this Exhibit H shall be $1.0277 per
Series B Preferred Unit, representing the conversion of the Priority Return from
8.875% per annum to 7.25% per annum during the quarterly

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period ended on such date, calculated as follows: (x) the month of January 2004
is counted as a 30-day month with a Priority Return of 8.875% per annum and the
period from and including February 1, 2004 to and including February 23, 2004 is
counted as a 23-day period of a 29-day month with a Priority Return of 8.875%
per annum, (y) the period from and including February 24, 2004 to and including
February 29, 2004 is counted as a six-day period of a 29-day month with a
Priority Return of 7.25% per annum and the month of March 2004 is counted as a
30-day month with a Priority Return of 7.25% per annum, and (z) the amounts for
the periods described in the preceding clauses (x) and (y) were added to obtain
the distribution payable per Series B Preferred Unit on March 31, 2004. If any
date on which distributions are to be made on the Series B Preferred Units is
not a Business Day (as defined herein), then payment of the distribution to be
made on such date will be made on the next succeeding day that is a Business Day
(and without any interest or other payment in respect of any such delay) except
that, if such Business Day is in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business Day, in each case with the
same force and effect as if made on such date. Distributions on the Series B
Preferred Units will be made to the holders of record of the Series B Preferred
Units on the relevant record dates to be fixed by the Partnership acting through
the General Partner, which record dates shall in no event exceed fifteen (15)
Business Days prior to the relevant Series B Preferred Unit Distribution Payment
Date (the “SERIES B PREFERRED UNIT PARTNERSHIP RECORD DATE”).

          The term “BUSINESS DAY” shall mean each day, other than a
Saturday or a Sunday, which is not a day on which banking institutions in New
York, New York are authorized or required by law, regulation or executive order
to close.

          No distributions on the Series B Preferred Units shall be
declared by the General Partner or paid or set apart for payment by the
Partnership at such time as the terms and provisions of any agreement of the
General Partner or the Partnership, including any agreement relating to
indebtedness of either of them, prohibits such declaration, payment, or setting
apart for payment or provides that such declaration, payment or setting apart
for payment would constitute a breach thereof or a default thereunder, or if
such declaration or payment shall be restricted or prohibited by law.

          (b) Distributions Cumulative. Distributions on the Series
B Preferred Units will accrue whether or not the terms and provisions of any
agreement of the Partnership, including any agreement relating to its
indebtedness at any time prohibit the current payment of distributions, whether
or not the Partnership has earnings, whether or not there are funds legally
available for the payment of such distributions and whether or not such
distributions are authorized. Accrued but unpaid distributions on the Series B
Preferred Units will accumulate as of the Series B Preferred Unit Distribution
Payment Date on which they first become payable. Distributions on account of
arrears for any past distribution periods may be declared and paid at any time,
without reference to a regular Series B Preferred Unit Distribution Payment Date
to holders of record of the Series B Preferred Units on the record date fixed by
the Partnership acting through the General Partner which date shall not exceed
fifteen (15) Business Days prior to the payment date. Accumulated and unpaid
distributions will not bear interest.

          (c) Priority as to Distributions.

               (i) So long as any Series B Preferred Units are
outstanding, no distribution of cash or other property shall be authorized,
declared, paid or set apart for payment on or with respect to any class or
series of Partnership Interest ranking junior as to the payment of distributions
or rights upon a voluntary or involuntary liquidation, dissolution or winding-up
of the Partnership to the Series B Preferred Units (collectively, “JUNIOR
UNITS”), nor shall any cash or other property be set aside for or applied to the
purchase, redemption or other acquisition for consideration of any Series B
Preferred Units, any Parity Preferred Units or any Junior Units or Rights in
respect of Junior Units, unless, in each case, all distributions accumulated on
all Series B Preferred Units and all classes and series of outstanding Parity
Preferred Units (or, in the event of the liquidation of the Partnership, to the
extent of respective Capital Account balances of holders of such Series B
Preferred Units and outstanding Parity Preferred Units in accordance with
Section 13.2 of the Partnership Agreement) have been paid in full. The foregoing
sentence will not prohibit (a) distributions payable solely in Junior Units (or
options, warrants or rights to subscribe for Junior Units), (b) the conversion
of Junior Units or Parity Preferred Units into Partnership Interests ranking
junior to the Series B Preferred Units as to distributions and rights upon
voluntary or involuntary liquidation,

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dissolution or winding up of the Partnership, or (c) the redemption of
Partnership Interests corresponding to any Series B Preferred Shares, Parity
Preferred Shares or Junior Shares to be purchased by the General Partner
pursuant to Article VI of the Declaration of Trust of the General Partner (the
“CHARTER”) to preserve the General Partner’s status as a real estate investment
trust, provided that such redemption shall be upon the same terms as the
corresponding purchase pursuant to Article VI of the Charter.

               (ii) So long as distributions have not been paid
in full (or a sum sufficient for such full payment is not irrevocably deposited
in trust for payment) upon the Series B Preferred Units, all distributions
authorized and declared on the Series B Preferred Units and all classes or
series of outstanding Parity Preferred Units shall be authorized and declared so
that the amount of distributions authorized and declared per Series B Preferred
Unit and such other classes or series of Parity Preferred Units shall in all
cases bear to each other the same ratio that accrued distributions per Series B
Preferred Unit and such other classes or series of Parity Preferred Units (which
shall not include any accumulation in respect of unpaid distributions for prior
distribution periods if such class or series of Parity Preferred Units do not
have cumulative distribution rights) bear to each other, except as would be made
upon a liquidation of the Partnership and a distribution of its assets in
accordance with Section 13.2 of the Partnership Agreement.

          (d) No Further Rights. Holders of Series B Preferred
Units shall not be entitled to any distributions, whether payable in cash, other
property or otherwise, in excess of the full cumulative distributions described
herein.

          (3) LIQUIDATION PROCEEDS.

          (a) Upon voluntary or involuntary liquidation, dissolution or
winding-up of the Partnership, distributions on the Series B Preferred Units
shall be made in accordance with Section 13.2 of the Partnership Agreement.

          (b) Notice. Written notice of any such voluntary or
involuntary liquidation, dissolution or winding-up of the Partnership, stating
the payment date or dates when, and the place or places where, the amounts
distributable in such circumstances shall be payable, shall be given by (i) fax
and (ii) by first class mail, postage pre-paid, not less than thirty (30) and
not more than sixty (60) days prior to the payment date stated therein, to each
record holder of the Series B Preferred Units at the respective addresses of
such holders as the same shall appear on the transfer records of the
Partnership.

          (c) No Further Rights. After payment of the full amount
of the liquidating distributions to which they are entitled, the holders of
Series B Preferred Units will have no right or claim to any of the remaining
assets of the Partnership.

          (d) Consolidation, Merger or Certain Other Transactions.
The voluntary sale, conveyance, lease, exchange or transfer (for cash, shares,
securities or other consideration) of all or substantially all of the property
or assets of the General Partner to, or the consolidation or merger or other
business combination of the Partnership with or into, any Company, trust or
other entity (or of any Company, trust or other entity with or into the
Partnership) shall not be deemed to constitute a liquidation, dissolution or
winding-up of the Partnership.

          (4) Redemption.

          (a) Right of Optional Redemption. Except as provided in
Section (4)(d) and Section (6)(a)(ii), the Series B Preferred Units may not be
redeemed prior to February 24, 2009. On or after such date, the Partnership
shall have the right to redeem the Series B Preferred Units, in whole or in
part, at any time or from time to time, upon not less than 30 nor more than 60
days’ written notice, at a redemption price, payable in cash, equal to the
Capital Account balance of the holders of Series B Preferred Units (the “SERIES
B REDEMPTION PRICE”); provided, however, that no redemption pursuant to this
SECTION will be permitted if the Series B Redemption Price does not equal or
exceed the original Capital Contribution of such holder plus the cumulative
Priority Return, whether or not declared, to the redemption date to the extent
not previously distributed. If fewer than all of the outstanding Series

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B Preferred Units are to be redeemed, the Series B Preferred Units to be
redeemed shall be selected pro rata (as nearly as practicable without creating
fractional units).

          (b) Limitation on Redemption.

               (i) The Series B Redemption Price (other than
the portion thereof consisting of accumulated but unpaid distributions) will be
payable solely out of the sale proceeds of capital shares of the General
Partner, which will be contributed by the General Partner to the Partnership as
additional capital contribution, or out of the sale of limited partner interests
in the Partnership and from no other source. For purposes of the preceding
sentence, “capital shares” means any equity securities (including Common Shares
and Preferred Shares (as such terms are defined in the Charter)), shares,
participation or other ownership interests (however designated) and any rights
(other than debt securities convertible into or exchangeable for equity
securities) or options to purchase any of the foregoing.

               (ii) The Partnership may not redeem fewer than
all of the outstanding Series B Preferred Units unless all accumulated and
unpaid distributions have been paid on all Series B Preferred Units for all
quarterly distribution periods terminating on or prior to the date of
redemption.

          (c) Procedures for Redemption.

               (i) Notice of redemption will be (A) faxed, and
(B) mailed by the Partnership, by certified mail, postage prepaid, not less than
30 nor more than 60 days prior to the redemption date, addressed to the
respective holders of record of the Series B Preferred Units at their respective
addresses as they appear on the records of the Partnership. No failure to give
or defect in such notice shall affect the validity of the proceedings for the
redemption of any Series B Preferred Units except as to the holder to whom such
notice was defective or not given. In addition to any information required by
law, each such notice shall state: (m) the redemption date, (n) the Series B
Redemption Price, (o) the aggregate number of Series B Preferred Units to be
redeemed and if fewer than all of the outstanding Series B Preferred Units are
to be redeemed, the number of Series B Preferred Units to be redeemed held by
such holder, which number shall equal such holder’s pro rata share (based on the
percentage of the aggregate number of outstanding Series B Preferred Units the
total number of Series B Preferred Units held by such holder represents) of the
aggregate number of Series B Preferred Units to be redeemed, (p) the place or
places where such Series B Preferred Units are to be surrendered for payment of
the Series B Redemption Price, (q) that distributions on the Series B Preferred
Units to be redeemed will cease to accumulate on such redemption date and (r)
that payment of the Series B Redemption Price will be made upon presentation and
surrender of such Series B Preferred Units.

               (ii) If the Partnership gives a notice of
redemption in respect of Series B Preferred Units (which notice will be
irrevocable) then, by 12:00 noon, New York City time, on the redemption date,
the Partnership will deposit irrevocably in trust for the benefit of the Series
B Preferred Units being redeemed funds sufficient to pay the applicable Series B
Redemption Price and will give irrevocable instructions and authority to pay
such Series B Redemption Price to the holders of the Series B Preferred Units
upon surrender of the Series B Preferred Units by such holders at the place
designated in the notice of redemption. If the Series B Preferred Units are
evidenced by a certificate and if fewer than all Series B Preferred Units
evidenced by any certificate are being redeemed, a new certificate shall be
issued upon surrender of the certificate evidencing all Series B Preferred
Units, evidencing the unredeemed Series B Preferred Units without cost to the
holder thereof. On and after the date of redemption, distributions will cease to
accumulate on the Series B Preferred Units or portions thereof called for
redemption, unless the Partnership defaults in the payment thereof. If any date
fixed for redemption of Series B Preferred Units is not a Business Day, then
payment of the Series B Redemption Price payable on such date will be made on
the next succeeding day that is a Business Bay (and without any interest or
other payment in respect of any such delay) except that, if such Business Day
falls in the next calendar year, such payment will be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on such date fixed for redemption. If payment of the Series B Redemption Price
is improperly withheld or refused and not paid by the Partnership, distributions
on such Series B Preferred Units will continue to accumulate from the original
redemption date to the

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date of payment, in which case the actual payment date will be considered the
date fixed for redemption for purposes of calculating the applicable Series B
Redemption Price.

          (d) Mandatory Redemption. Notwithstanding any provision herein
to the contrary (including Section (4)(a)), so long as any Series B Preferred
Units remain outstanding, in the event of the occurrence of a Covered
Transaction (defined below), the Partnership shall redeem, on the date such
Covered Transaction is completed or occurs, all of the Series B Preferred Units
outstanding at the Series B Redemption Price, payable in cash, if redemption of
the Series B Preferred Units was elected in writing by the holders of not less
than a majority of the then outstanding Series B Preferred Units in accordance
with this Section (4)(d). The Partnership shall give written notice of a Covered
Transaction to each of the respective holders of record of the Series B
Preferred Units, at their respective addresses as they appear on the transfer
records of the Partnership, not less than thirty (30) days prior to the
completion or occurrence of a Covered Transaction. Such notice shall not set
forth any non-public information concerning such Covered Transaction. Each of
the holders of record of the Series B Preferred Units shall have until 5:00 p.m.
New York City time, on the fifteenth (15th) day following receipt of such notice
from the Partnership, to give the Partnership notice of such holder’s election
that the Series B Preferred Units be redeemed. Notwithstanding any provision
herein to the contrary, with respect to a Covered Transaction that arises under
clause (c) of the definition of Covered Transaction set forth below, in the
event that the General Partner so fails to qualify as a real estate investment
trust for any reason other than an affirmative election by the General Partner
not to qualify, (a) the Partnership shall give notice of the occurrence of a
Covered Transaction to each of the holders of record of the Series B Preferred
Units within 15 days of discovery of such failure to qualify (provided that, if
the General Partner is pursuing administrative relief from the Internal Revenue
Service with respect to such failure to qualify as a real estate investment
trust, such notice shall be given upon the earlier of (1) five days after the
denial of administrative relief by the Internal Revenue Service or (2) 60 days
following the discovery of such failure to qualify), (b) each of the holders of
record of the Series B Preferred Units shall have until 5:00 p.m. New York City
time, on the fifteenth (15th) day following receipt of such notice from the
Partnership, to give the Partnership notice of such holder’s election that the
Series B Preferred Units be redeemed or not redeemed (and if any holder of
record of the Series B Preferred Units fails to give the Partnership such notice
of election, then such holder of record shall be deemed to have given a notice
of an election that the Series B Preferred Units be redeemed) and (c) if the
holders of not less than a majority of the then outstanding Series B Preferred
Units have elected to have the Series B Preferred Units redeemed, the Series B
Preferred Units shall be redeemed on a date not later than 30 days following the
date of the Partnership’s notice referred to in clause (a) above.

          The procedures set forth in Section (4)(c) (other than the
requirement that notice of redemption be faxed and mailed not less than 30 days
prior to the redemption date) shall apply to a redemption pursuant to this
Section (4)(d). On or before the date of redemption, the Partnership shall give
notice of redemption to the respective holders of record of the Series B
Preferred Units, at their respective addresses as they appear on the transfer
records of the Partnership.

          For purposes of this Section (4)(d), the term “Covered
Transaction” shall mean (a) the General Partner’s completion of a “Rule 13e-3
transaction” (as defined in Rule 13e-3 under the Securities Exchange Act of
1934, as amended (the “Exchange Act”)) in which, as a result of such
transaction, the General Partner ‘s common stock is no longer registered under
Section 12 of the Exchange Act, except that this clause (a) shall not apply to
any involuntary delisting of the General Partner ‘s common stock from the New
York Stock Exchange or any national securities exchange (as defined in the
Exchange Act), (b) the completion of any transaction or series of transactions
that would result in a Reorganization Event (defined below) of the General
Partner or the Partnership or (c) the General Partner ‘s failure (or election
not) to qualify as a real estate investment trust as defined in Section 856 (or
any successor section) of the Internal Revenue Code of 1986, as amended.

          For purposes of this Section (4)(d), the term “Reorganization
Event” shall mean (x) any sale or other disposition of all or substantially all
of the assets of the Partnership or the General Partner, as the case may be, to
an entity (or more than one entity in related transactions) that is not an
Affiliate of the General Partner; or (y) any consolidation, amalgamation,
merger, business combination, share exchange, reorganization or similar
transaction involving the Partnership or the General Partner, as the case may
be, pursuant to which the Partners of the Partnership or the shareholders of the
General Partner, as the case may be, immediately prior to the consummation

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of such transaction will own less than a majority of the equity interests in the
entity surviving such transaction; provided, however, a Reorganization Event
shall not include any transaction contemplated by clauses (x) or (y) of this
definition if the surviving entity has unsecured debt outstanding which is rated
at least the lowest credit rating level established as investment grade by at
least two of Standard & Poor’s, Moody’s Investor Service and Fitch Ratings (it
being understood that as of the date hereof the lowest investment grade rating
of Standard & Poor’s is BBB-, the lowest investment grade rating of Moody’s is
Baa3 and the lowest investment grade rating of Fitch Ratings is BBB-) and such
rating has been reaffirmed in light of the contemplated transaction.

          (5) Voting Rights.

          (a) General. Holders of the Series B Preferred Units will
not have any voting rights or right to consent to any matter requiring the
consent or approval of the Limited Partners, except as set forth in Sections 14
of the Partnership Agreement and in this Section.

          (b) Certain Voting Rights. So long as any Series B
Preferred Units remain outstanding, the Partnership shall not, without the
affirmative vote of the holders of at least two-thirds of the Series B Preferred
Units outstanding at the time: (i) authorize or create, or increase the
authorized or issued amount of, any class or series of Partnership Interests
ranking prior to the Series B Preferred Units with respect to payment of
distributions or rights upon liquidation, dissolution or winding-up or
reclassify any Partnership Interests into any such Partnership Interest, or
create, authorize or issue any obligations or security convertible into or
evidencing the right to purchase any such Partnership Interests, provided that
the foregoing shall not apply if such class or series is of a priority equal to
either the Series C Preferred Units, the Series D Preferred Units or the Common
Units in all respects but that could have a priority with respect to the Series
B Preferred Units upon a liquidation of the Partnership solely by reason of the
fact that either Section 1.F of Exhibit C to the Partnership Agreement does not
apply to the Series B Preferred Units or the allocation of Net Income provided
for in Section 6.A(iii) precedes the allocation of Net Income provided for in
Section 6.A(iv); (ii) authorize or create, or increase the authorized or issued
amount of any Parity Preferred Units or reclassify any Partnership Interest into
Parity Preferred Units or create, authorize or issue any obligations or security
convertible into or evidencing the right to purchase any Parity Preferred Units
but only to the extent such Parity Preferred Units are issued to an Affiliate of
the Partnership, unless (A) such Affiliate is the General Partner and such
Parity Preferred Units correspond to preferred shares issued to a nonaffiliate
of the Partnership or (B) such Parity Preferred Units are issued upon terms
determined by the General Partner’s Board of Trustees to be no more favorable
than those it would offer in an arm’s length transaction to an unrelated party;
or (iii) amend, alter or repeal the provisions of the Partnership Agreement
(including, without limitation, Section 4.2(B) thereof), whether by merger,
consolidation or otherwise, that would materially and adversely affect the
powers, special rights, preferences, privileges or voting power of the Series B
Preferred Units or the holders thereof; provided, however, that with respect to
the occurrence of a merger, consolidation or a sale or lease of all of the
Partnership’s assets as an entirety, so long as (1) the Partnership is the
surviving entity and the Series B Preferred Units remain outstanding with the
terms thereof unchanged, (2) the resulting, surviving or transferee entity is a
partnership, limited liability company or other pass-through entity organized
under the laws of any state and substitutes for the Series B Preferred Units
other interests in such entity having substantially the same terms and rights as
the Series B Preferred Units, including with respect to distributions, voting
rights and rights upon liquidation, dissolution or winding-up, or (3) such
merger, consolidation or a sale or lease of all of the Partnership’s assets as
an entirety would constitute a Reorganization Event entitling the holders to
elect redemption under Section 4(d) hereof, then the occurrence of any such
event shall not be deemed to materially and adversely affect such rights,
privileges or voting powers of the holders of the Series B Preferred Units; and
provided further that any increase in the amount of Partnership Interests or the
creation or issuance of any other class or series of Partnership Interests, in
each case ranking (y) junior to the Series B Preferred Units with respect to
payment of distributions or the distribution of assets upon liquidation,
dissolution or winding-up, or (z) on a parity to the Series B Preferred Units
with respect to payment of distributions or the distribution of assets upon
liquidation, dissolution or winding-up but only to the extent such Partnership
Interests are issued to an Affiliate of the Partnership unless (A) such
Affiliate is the General Partner and such Parity Preferred Units correspond to
preferred shares issued to a nonaffiliate of the Partnership or (B) such Parity
Preferred Units are issued upon terms determined by the General Partner’s Board
of Trustees to be no more favorable than it would offer in an arm’s length
transaction to an unrelated party, shall not be deemed to materially and
adversely affect such rights, preferences, privileges or voting powers. In the
event of any conflict between the provisions of

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Section 7.3 or Article 14 of the Partnership Agreement and the provisions of
this Section, the provisions of this Section shall control.

          (6) Exchange Rights.

          (a) Right to Exchange.

               (i) Series B Preferred Units will be
exchangeable in whole or in part at anytime on or after January 1, 2014, at the
option of the holders thereof, for authorized but previously unissued shares of
7.25% Series B Cumulative Redeemable Perpetual Preferred Shares of the General
Partner (the “SERIES B PREFERRED SHARES”) at an exchange rate of one share of
Series B Preferred Shares for one Series B Preferred Unit, subject to adjustment
as described below (the “EXCHANGE PRICE”), provided that the Series B Preferred
Units will become exchangeable at any time, in whole or in part, at the option
of the holders of Series B Preferred Units for Series B Preferred Shares if (y)
at any time full distributions shall not have been timely made on any Series B
Preferred Unit with respect to six (6) prior quarterly distribution periods,
whether or not consecutive, provided, however, that a distribution in respect of
Series B Preferred Units shall be considered timely made if made within two (2)
Business Days after the applicable Series B Preferred Unit Distribution Payment
Date if at the time of such late payment there shall not be any prior quarterly
distribution periods in respect of which full distributions were not timely made
or (z) upon receipt by a holder or holders of Series B Preferred Units of (1)
notice from the General Partner that the General Partner or a Subsidiary of the
General Partner has taken the position that the Partnership is, or upon the
occurrence of a defined event in the immediate future will be, a PTP and (2) an
opinion rendered by an outside nationally recognized independent counsel
familiar with such matters addressed to a holder or holders of Series B
Preferred Units, that the Partnership is or likely is, or upon the occurrence of
a defined event in the immediate future will be or likely will be, a PTP. In
addition, the Series B Preferred Units may be exchanged for Series B Preferred
Shares, in whole or in part, at the option of any holder prior to the tenth
(10th) anniversary of the issuance date and after the third anniversary thereof
if such holder of a Series B Preferred Units shall deliver to the General
Partner either (i) a private ruling letter addressed to such holder of Series B
Preferred Units or (ii) an opinion of independent counsel reasonably acceptable
to the General Partner based on the enactment of temporary or final Treasury
Regulations or the publication of a Revenue Ruling, in either case to the effect
that an exchange of the Series B Preferred Units at such earlier time would not
cause the Series B Preferred Units to be considered “shares and securities”
within the meaning of Section 351(e) of the Internal Revenue Code of 1986, as
amended (the “CODE”), for purposes of determining whether the holder of such
Series B Preferred Units is an “investment company” under Section 721(b) of the
Code if an exchange is permitted at such earlier date. Furthermore, the Series B
Preferred Units may be exchanged in whole but not in part (regardless of whether
held by Contributors) for Series B Preferred Shares (but only if the exchange in
whole may be accomplished consistently with the ownership limitations set forth
under Article VI of the Charter of the General Partner, taking into account
exceptions thereto) if at any time, (i) the Partnership reasonably determines
that the assets and income of the Partnership for a taxable year after 1999
would not satisfy the income and assets tests of Section 856 of the Code for
such taxable year if the Partnership were a real estate investment trust within
the meaning of the Code or (ii) any holder of Series B Preferred Units shall
deliver to the Partnership and the Company an opinion of independent counsel
reasonably acceptable to the Company to the effect that, based on the assets and
income of the Partnership for a taxable year after 1999, the Partnership would
not satisfy the income and assets tests of Section 856 of the Code for such
taxable year if the Partnership were a real estate investment trust within the
meaning of the Code and that such failure would create a meaningful risk that a
holder of the Series B Preferred Units would fail to maintain qualification as a
real estate investment trust.

               (ii) Notwithstanding anything to the contrary set
forth in SECTION 4 OR (6)(a)(i), if an Exchange Notice (as hereinafter defined)
has been delivered to the General Partner, then the General Partner may, at its
option, elect to redeem or cause the Partnership to redeem all or a portion of
the Series B Preferred Units which are the subject of such Exchange Notice for
cash in an amount equal to the original Capital Contribution per Series B
Preferred Unit redeemed and all accrued and unpaid distributions thereon to the
date of redemption. The General Partner may exercise its option to redeem Series
B Preferred Units for cash pursuant to this SECTION (6)(a)(ii) by giving each
holder of Series B Preferred Units that are to be redeemed notice of its
election to redeem for cash, within five (5) Business Days after receipt of the
Exchange Notice, by (m) fax, and (n) registered mail, postage paid, at the
address of each such holder as it may appear on the records of the Partnership
stating (A) the redemption date,

H-7

 

which shall be no later than sixty (60) days following the receipt of the
Exchange Notice, (B) the Series B Redemption Price, (C) the place or places
where the Series B Preferred Units are to be surrendered for payment of the
Series B Redemption Price, (D) that distributions on the Series B Preferred
Units redeemed will cease to accrue on such redemption date; (E) that payment of
the Series B Redemption Price will be made upon presentation and surrender of
the Series B Preferred Units and (F) the aggregate number of Series B Preferred
Units held by such holder that are to be redeemed for cash, which number shall
equal such holder’s pro-rata share (based on the percentage of the aggregate
number of Series B Preferred Units that are the subject of such Exchange Notice
that the total number of Series B Preferred Units being redeemed by such holder
represents) of the aggregate number of Series B Preferred Units being redeemed.

               (iii) In the event an exchange of all or a portion
of Series B Preferred Units pursuant to SECTION (6)(a)(i) would violate the
provisions on ownership limitation of the General Partner set forth in Article
VI of the Charter of the General Partner with respect to the Series B Preferred
Shares, the General Partner shall give written notice thereof to each holder of
record of Series B Preferred Units, within five (5) Business Days following
receipt of the Exchange Notice, by (m) fax, and (n) registered mail, postage
prepaid, at the address of each such holder set forth in the records of the
Partnership. In such event, each holder of Series B Preferred Units shall be
entitled to exchange, pursuant to the provisions of SECTION (6)(b) a number of
Series B Preferred Units which would comply with the provisions on the ownership
limitation of the General Partner set forth in such Article VI of the Charter of
the General Partner and any Series B Preferred Units not so exchanged (the
“EXCESS UNITS”) shall be redeemed by the Partnership for cash in an amount equal
to the original Capital Contribution per Excess Unit, plus any accrued and
unpaid distributions thereon, whether or not declared, to the date of
redemption. The written notice of the General Partner shall state (A) the number
of Excess Units held by such holder, (B) the Series B Redemption Price of the
Excess Units, (C) the date on which such Excess Units shall be redeemed, which
date shall be no later than sixty (60) days following the receipt of the
Exchange Notice, (D) the place or places where such Excess Units are to be
surrendered for payment of the Series B Redemption Price, (E) that distributions
on the Excess Units will cease to accrue on such redemption date, and (F) that
payment of the Series B Redemption Price will be made upon presentation and
surrender of such Excess Units. In the event an exchange would result in Excess
Units, as a condition to such exchange, each holder of such units agrees to
provide representations and covenants reasonably requested by the General
Partner relating to (1) the widely held nature of the interests in such holder,
sufficient to assure the General Partner that the holder’s ownership of shares
of the General Partner (without regard to the limits described above) will not
cause any individual to own in excess of 9.8% of the value of the aggregate
shares of the General Partner; and (2) to the extent such holder can so
represent and covenant without obtaining information from its owners, the
holder’s ownership of tenants of the Partnership and its affiliates.

               (iv) The redemption of Series B Preferred Units
described in SECTION (6)(a)(ii) and (iii) shall be subject to the provisions of
SECTION (4)(b)(i) and SECTION (4)(c)(ii); provided, however, that the term
“Series B Redemption Price” in such Section shall be read to mean the original
Capital Contribution per Series B Preferred Unit being redeemed plus all accrued
and unpaid distributions to the redemption date.

          (b) Procedure for Exchange.

               (i) Any exchange shall be exercised pursuant to
a notice of exchange (the “EXCHANGE NOTICE”) delivered to the General Partner by
the holder who is exercising such exchange right, by (a) fax and (b) by
certified mail postage prepaid. The exchange of Series B Preferred Units, or a
specified portion thereof, may be effected after the tenth (10th) Business Day
following receipt by the General Partner of the Exchange Notice by delivering
certificates, if any, representing such Series B Preferred Units to be exchanged
together with, if applicable, written notice of exchange and a proper assignment
of such Series B Preferred Units to the office of the General Partner maintained
for such purpose. Currently, such office is 2101 Sixth Avenue North, Suite 750,
Birmingham, Alabama 35203. Each exchange will be deemed to have been effected
immediately prior to the close of business on the date on which such Series B
Preferred Units to be exchanged (together with all required documentation) shall
have been surrendered and notice shall have been received by the General Partner
as aforesaid and the Exchange Price shall have been paid. Any Series B Preferred
Shares issued pursuant to this SECTION shall be delivered as shares which are
duly authorized, validly issued, fully paid and nonassessable, free of pledge,
lien,

H-8

 

encumbrance or restriction other than those provided in the Charter, the Bylaws
of the General Partner, the Securities Act of 1933, as amended, and relevant
state securities or blue sky laws.

               (ii) In the event of an exchange of Series B
Preferred Units for shares of Series B Preferred Shares, an amount equal to the
accrued and unpaid distributions, whether or not declared, to the date of
exchange on any Series B Preferred Units tendered for exchange shall (a) accrue
on the shares of the Series B Preferred Shares into which such Series B
Preferred Units are exchanged, and (b) continue to accrue on such Series B
Preferred Units, which shall remain outstanding following such exchange, with
the General Partner as the holder of such Series B Preferred Units.
Notwithstanding anything to the contrary set forth herein, in no event shall a
holder of a Series B Preferred Unit that was validly exchanged into Series B
Preferred Shares pursuant to this section (other than the General Partner now
holding such Series B Preferred Unit), receive a distribution out of Available
Cash of the Partnership, if such holder, after exchange, is entitled to receive
a distribution out of Available Cash with respect to the share of Series B
Preferred Shares for which such Series B Preferred Unit was exchanged or
redeemed.

               (iii) Fractional shares of Series B Preferred
Shares are not to be issued upon exchange but, in lieu thereof, the General
Partner will pay a cash adjustment based upon the fair market value of the
Series B Preferred Shares on the day prior to the exchange date as determined in
good faith by the Board of Trustees of the General Partner.

          (c) Adjustment of Exchange Price.

               (i) The Exchange Price is subject to adjustment
upon certain events, including, (a) subdivisions, combinations and
reclassification of the Series B Preferred Shares, and (b) distributions to all
holders of Series B Preferred Shares of evidences of indebtedness of the General
Partner or assets (including securities, but excluding dividends and
distributions paid in cash out of equity applicable to Series B Preferred
Shares).

               (ii) In case the General Partner shall be a party
to any transaction (including, without limitation, a merger, consolidation,
statutory share exchange, tender offer for all or substantially all of the
General Partner’s capital shares or sale of all or substantially all of the
General Partner’s assets), in each case as a result of which the Series B
Preferred Shares will be converted into the right to receive shares of capital
shares, other securities or other property (including cash or any combination
thereof), each Series B Preferred Unit will thereafter be exchangeable into the
kind and amount of shares of capital shares and other securities and property
receivable (including cash or any combination thereof) upon the consummation of
such transaction by a holder of that number of shares of Series B Preferred
Shares or fraction thereof into which one Series B Preferred Unit was
exchangeable immediately prior to such transaction. The General Partner may not,
without the prior written consent of the holders of at least two-thirds of the
Series B Preferred Units outstanding, become a party to any such transaction
unless the terms thereof are consistent with the foregoing.

          (7) NO CONVERSION RIGHTS. The holders of the Series B
Preferred Units shall not have any rights to convert such units into units of
any other class or series of units or into any other securities of, or interest
in, the Partnership.

          (8) NO SINKING FUND. No sinking fund shall be established
for the retirement or redemption of Series B Preferred Units.

H-9

 

EIGHTH AMENDMENT TO

THIRD AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

OF

COLONIAL REALTY LIMITED PARTNERSHIP

     THIS EIGHTH AMENDMENT (this “Eighth Amendment”) TO THIRD AMENDED AND
RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF COLONIAL REALTY LIMITED PARTNERSHIP
(as amended by Amendments dated as of January 5, 2000, as of January 25, 2000,
as of August 28, 2000, as of April 17, 2001, as of June 19, 2001, as of April
30, 2003 and as of February 18, 2004, collectively, the “Partnership
Agreement”), dated as of March 14, 2005, is entered into among Colonial
Properties Trust, as general partner (the “General Partner”) of Colonial Realty
Limited Partnership (the “Partnership”), for itself and on behalf of the limited
partners of the Partnership (the “Limited Partners”), and each of the holders
of the Series B Preferred Units.

     WHEREAS, the General Partner desires to, and each holder of Series B
Preferred Units desires to consent to, amend the Partnership Agreement to amend
the terms of the Series B Preferred Units to make the Series B Preferred Units
callable on or after August 24, 2009 rather than February 24, 2009, as currently
provided in Exhibit H to the Partnership Agreement.

     NOW, THEREFORE, in consideration of good and valuable consideration, the
receipt and sufficiency of which hereby are acknowledged, the General Partner
hereby amends the Partnership Agreement, as follows:

     1. Amendment to Exhibit H to Partnership Agreement. Exhibit H to the
Partnership Agreement is hereby amended by deleting the reference to “February
24, 2009” in Section 4(a) of Exhibit H and replacing such reference with “August
24, 2009.”

     2. Certain Capitalized Terms. All capitalized terms used in this Eighth
Amendment and not otherwise defined shall have the meanings assigned in the
Partnership Agreement. Except as modified herein, all terms and conditions of
the Partnership Agreement shall remain in full force and effect, which terms and
conditions the General Partner hereby ratifies and affirms.

     3. Approval. To the extent such approval or consent is required pursuant to
Section 5(b)(iii) of Exhibit H or any other provision of the Partnership

 

 

Agreement, each of the undersigned holders of Series B Preferred Units,
constituting 100% of the holders of the issued and outstanding Series B
Preferred Units, hereby approves and consents to the amendment of the
Partnership Agreement set forth in this Eighth Amendment and the other
transactions contemplated hereby.

     4. Conforming Amendment. The General Partner shall present to its board of
trustees an amendment (the “Proposed Amendment”) to the articles supplementary
for the 7.25% Series B Cumulative Redeemable Perpetual Preferred Shares to
delete the reference to “February 24, 2009” in ARTICLE SECOND, Section 5(a) of
such articles supplementary and replace such reference with “August 24, 2009.”
If the board of trustees approves the Proposed Amendment (and all other
necessary corporate and contractual approvals, if any, are obtained), the
General Partner shall file the Proposed Amendment with the appropriate state
offices in Alabama. The General Partner shall use reasonable efforts to complete
the actions in this Section 4 within 60 days after the date hereof.

[Signatures appear on following page]

 

 

     IN WITNESS WHEREOF, the undersigned has executed this Eighth Amendment as
of the date first set forth above.

	 	 	 	 	 	 	 
	 	 	COLONIAL PROPERTIES TRUST,

as General Partner of

Colonial Realty Limited Partnership	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Weston Andress
 

Weston Andress
	 	 
	 

	 	Title:
	 	Chief Financial and Investment Officer	 	 
	 
	 	 	 	 	 	 
	 	 	Series B Preferred Unit Holders:	 	 
	 
	 	 	 	 	 	 
	 	 	BELAIR REAL ESTATE CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Thomas Faust
 

Thomas Faust
	 	 
	 

	 	Title:
	 	Executive Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	BEL ALLIANCE PROPERTIES LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Thomas Faust
 

Thomas Faust
	 	 
	 

	 	Title:
	 	Manager	 	 
	 
	 	 	 	 	 	 
	 	 	BEL ALLIANCE APARTMENTS LLC	 	 
	 
	 

	 	By:

Name:
	 	/s/ Thomas Faust
 

Thomas Faust
	 	 
	 

	 	Title:
	 	Manager	 	 

 

 

	 	 	 	 	 	 	 
	 	 	BELPORT REALTY CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Thomas Faust
 

Thomas Faust
	 	 
	 

	 	Title:
	 	Executive Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	BELSHIRE REALTY CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Thomas Faust
 

Thomas Faust
	 	 
	 

	 	Title:
	 	Executive Vice President	 	 

 

 

NINTH AMENDMENT TO

THIRD AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

OF

COLONIAL REALTY LIMITED PARTNERSHIP

     THIS NINTH AMENDMENT TO THIRD AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF
COLONIAL REALTY LIMITED PARTNERSHIP (this “Ninth Amendment” to the “Partnership Agreement”), dated
as of April 1, 2005, is entered into by Colonial Properties Trust, as general partner (the “General
Partner”) of Colonial Realty Limited Partnership (the “Partnership”), for itself and on behalf of
the limited partners of the Partnership (the “Limited Partners”).

     WHEREAS, Section 4.2.A of the Partnership Agreement authorizes the General Partner to cause
the Partnership to issue additional Partnership Units in one or more classes or series, with such
designations, preferences and relative, participating, optional or other special rights, powers and
duties as shall be determined by the General Partner in its sole and absolute discretion, subject
to the condition that no such additional Partnership Units shall be issued to the General Partner
unless (i) the additional Partnership Units are issued in connection with an issuance of shares by
the General Partner, which shares have designations, preferences and other rights, substantially
similar to the designations, preferences and other rights of the additional Partnership Units
issued to the General Partner and (ii) the General Partner makes a capital contribution of an
amount equal to the net proceeds raised in connection with the issuance of such shares;

     WHEREAS, General Partner has entered into an Agreement and Plan of Merger, dated as of October
25, 2004 (as amended, the “Merger Agreement”), among the General Partner, CLNL Acquisition Sub LLC
and Cornerstone Realty Income Trust, Inc., pursuant to which the General Partner has issued REIT
Shares and 7.62% Series E Cumulative Redeemable Preferred Shares of Beneficial Interest, par value
$0.01 per share (the “Series E Preferred Shares”), of the General Partner;

     WHEREAS, General Partner is concurrently making a capital contribution to the Partnership of
the assets acquired through the Merger Agreement in exchange for a number of Class A Units and
Series E Preferred Units (as defined below) equal to the number of REIT Shares and Series E
Preferred Shares issued pursuant to the Merger Agreement;

     WHEREAS, in connection with the issuance of the Series E Preferred Shares and pursuant to the
authority granted to the General Partner pursuant to Section 4.2.A of the Partnership Agreement,
the General Partner desires to amend the Partnership Agreement to establish a new class of Units,
to be entitled Series E Cumulative Redeemable Preferred Units (the “Series E Preferred Units”), and
to set forth the designations, rights, powers, preferences and duties
of such Series E Preferred Units, which are substantially the same as those of the Series E
Preferred Shares; and

     WHEREAS, the General Partner desires to further amend the Partnership Agreement to provide for
the issuance of Class A Units and Series E Preferred Units in connection with such capital
contribution to the Partnership of the assets acquired through the Merger Agreement, which capital

 

 

contribution is being made concurrently herewith pursuant to a Contribution Agreement, dated as of
the date hereof, between the General Partner and the Partnership (the “Contribution Agreement”).

     NOW, THEREFORE, in consideration of the premises and for other good and valuable
consideration, the receipt and sufficiency of which hereby are acknowledged, the General Partner
hereby amends the Partnership Agreement, as follows:

     1.     Series E Preferred Units. Section 4.2 of the Partnership Agreement is hereby
amended by adding after Section 4.2.H the following section:

I.     Series E Preferred Units. Under the authority granted to it by
Section 4.2.A hereof, the General Partner hereby establishes and designates as
Preferred Units an additional class of Partnership Units entitled “Series E
Cumulative Redeemable Preferred Units” (the “Series E Preferred Units”). Series E
Preferred Units shall have the designations, preferences, rights, powers and duties
as set forth in Exhibit L hereto.

     2.     Exhibits to Partnership Agreement. The Partnership Agreement is hereby amended by
attaching thereto as Exhibit L the Exhibit L attached hereto.

     3.     Issuance of Class A Units and Series E Preferred Units. Exhibit A to the
Partnership Agreement is hereby amended to reflect the issuance to the General Partner pursuant to
the transactions contemplated by the Contribution Agreement of (a) a number of Class A Units equal
to the number of REIT Shares issued pursuant to the Merger Agreement and (b) a number of Series E
Preferred Units equal to the number of Series E Preferred Shares issued pursuant to the Merger
Agreement.

     4.     Certain Capitalized Terms. All capitalized terms used in this Ninth Amendment and
not otherwise defined shall have the meanings assigned in the Partnership Agreement. Except as
modified herein, all terms and conditions of the Partnership Agreement shall remain in full force
and effect, which terms and conditions the General Partner hereby ratifies and affirms.

[Signature appears on following page]

 

 

     IN WITNESS WHEREOF, the undersigned has executed this Ninth Amendment as of the date first set
forth above.

	 	 	 	 	 
	 	COLONIAL PROPERTIES TRUST,

as General Partner of

Colonial Realty Limited Partnership

 	 
	 	By:  	/s/ Thomas H. Lowder
 	 
	 	 	Name:  	Thomas H. Lowder 	 
	 	 	Title:  	President and CEO 	 

 

 

	 	 	 	 	 

EXHIBIT L

DESIGNATION OF THE PREFERENCES, RIGHTS, VOTING POWERS,
 RESTRICTIONS, QUALIFICATIONS AND LIMITATIONS

OF THE

SERIES E PREFERRED UNITS

     The Series E Preferred Units shall have the following designations, preferences, rights,
powers and duties:

     (1)     Certain Defined Terms. The following capitalized terms used in
this Exhibit L shall have the respective meanings set forth below:

     “Distribution Period” means quarterly periods commencing on the first day of
January, April, July and October of each year and ending on and including the next
succeeding Quarterly Distribution Date (as defined below) (other than the initial
Distribution Period, which shall commence on February 4, 2005, and other than the
Distribution Period during which any Series E Preferred Units shall be redeemed
pursuant to Section 4, which shall end on and include the date of such redemption).

     “Fully Junior Units” shall mean the Common Units, the Series 1998 Preferred
Units and any other class or series of Partnership Units now or hereafter issued and
outstanding over which the Series E Preferred Units have a preference or priority in
both (i) the payment of distributions and (ii) the distribution of assets on any
liquidation, dissolution or winding up of the Partnership.

     “Junior Units” shall mean the Common Units, the Series 1998 Preferred Units and
any other class or series of Partnership Units now or hereafter issued and
outstanding over which the Series E Preferred Units have a preference or priority in
the payment of distributions or in the distribution of assets on any liquidation,
dissolution or winding up of the Partnership.

     “Parity Units” has the meaning ascribed thereto in Section 6(B).

     (2)     Distributions.

          (A)     The General Partner, in its capacity as the holder of the then outstanding
Series E Preferred Units, shall be entitled to receive out of funds legally
available therefor, distributions payable on the last day (or, if not a Business
Day, the next succeeding Business Day) of each March, June, September and December
beginning on June 30, 2005 (each such day being hereafter called a “Quarterly
Distribution Date”), in an amount per Series E Preferred Unit equal to
the amount of the dividend on one Series E Preferred Share declared by the board of
trustees of the General Partner to be paid on such Quarterly Distribution Date.
Quarterly distributions on each Series E Preferred Unit shall begin to accrue and
shall be fully cumulative from and including February 4, 2005. Quarterly
distributions paid on the Series E Preferred Units in an amount less than the total
amount of such quarterly distributions at the time

L-1

 

accrued and payable on such
Partnership Units shall be allocated pro rata on a per unit basis among all such
Series E Preferred Units. Accrued and unpaid distributions for any past
Distribution Periods may be declared and paid at any time and for such interim
periods, without reference to any regular Quarterly Distribution Date, to the
General Partner, on such date as may be fixed by the General Partner for payment of
the corresponding dividend on the Series E Preferred Shares. Any distribution made
on the Series E Preferred Units shall first be credited against the earliest accrued
but unpaid distribution due with respect to Series E Preferred Units which remains
payable.

          (B)     The amount of any quarterly distributions accrued on any Series E Preferred
Units at any Quarterly Distribution Date shall be the amount of any unpaid quarterly
distributions accumulated thereon, to and including such Quarterly Distribution
Date. The amount of distribution for the initial Distribution Period and any other
Distribution Period on the Series E Preferred Units that represents less than a full
quarter of a year shall be computed on the basis of a 360-day year of twelve 30-day
months. No interest, or sum of money in lieu of interest, shall be payable in
respect of any distribution payment or payments on the Series E Preferred Units that
may be in arrears.

          (C)     So long as any Series E Preferred Units are outstanding, no distributions,
except as described in the immediately following sentence, shall be paid or set
apart for payment on any class or series of Parity Units for any period unless full
cumulative distributions have been or contemporaneously are paid or declared and a
sum sufficient for the payment thereof set apart for such payment on the Series E
Preferred Units for all Distribution Periods terminating on or prior to the
distribution payment date for such class or series of Parity Units. When
distributions are not paid in full or a sum sufficient for such payment is not set
apart, as aforesaid, all distributions payable or declared upon Series E Preferred
Units and all distributions payable or declared upon any other class or series of
Parity Units shall be declared or paid ratably in proportion to the respective
amounts of distributions accumulated and unpaid on the Series E Preferred Units and
accumulated and unpaid on such Parity Units.

          (D)     So long as any Series E Preferred Units are outstanding, no distributions
(other than distributions paid solely in Fully Junior Units or options, warrants or
rights to subscribe for or purchase Fully Junior Units) shall be declared or paid or
set apart for payment or other distribution shall be declared or made or set apart
for payment upon Junior Units, nor shall any Junior Units be
redeemed, purchased or otherwise acquired (other than a redemption, purchase or
other acquisition of Class A Units made for purposes of an employee incentive or
benefit plan of the General Partner or any subsidiary) for any consideration (or any
moneys be paid to or made available for a sinking fund for the redemption of any
such Junior Units) by the Partnership, directly or indirectly (except by conversion
into or exchange for Fully Junior Units), unless in each case (i) the full
cumulative distributions on all outstanding Series E Preferred Units and any other
Parity Units of the Partnership shall have been paid or set apart for payment for
all past Distribution Periods with respect to the Series E Preferred Units and all
past distribution periods with respect to such Parity Units and (ii) sufficient
funds shall have been paid or declared and set apart for the payment of the
distribution for the current Distribution Period with respect to the Series E
Preferred Units and the current distribution period with respect to such Parity
Units.

L-2

 

          (E)     No distributions on the Series E Preferred Units shall be paid or set apart
for payment by the Partnership at such time as the terms and provisions of any
agreement of the General Partner or the Partnership, including any agreement
relating to indebtedness of either of them, prohibits such declaration, payment, or
setting apart for payment or provides that such declaration, payment or setting
apart for payment would constitute a breach thereof or a default thereunder, or if
such declaration or payment shall be restricted or prohibited by law.

          (F)     Except as provided herein, the Series E Preferred Units shall not be
entitled to participate in the earnings or assets of the Partnership, and no
interest, or sum of money in lieu of interest, shall be payable in respect of any
distribution or distributions on the Series E Preferred Units which may be in
arrears.

     (3)     Liquidation Preference.

          (A)     In the event of any liquidation, dissolution or winding up of the
Partnership, whether voluntary or involuntary, before any payment or distribution of
the assets of the Partnership shall be made to or set apart for the holders of
Junior Units, the General Partner, in its capacity as holder of the Series E
Preferred Units, shall be entitled to receive Two Thousand Five Hundred Dollars
($2,500.00) (the “Series E Liquidation Preference”) per Series E Preferred Unit plus
an amount equal to all dividends accrued and unpaid on one Series E Preferred Share
to the date of final distribution to the General Partner, in its capacity as such
holder; but the General Partner, in its capacity as the holder of Series E Preferred
Units, shall not be entitled to any further payment with respect to such Series E
Preferred Units. If, upon any such liquidation, dissolution or winding up of the
Partnership, the assets of the Partnership, or proceeds thereof, distributable to
the General Partner, in its capacity as the holder of Series E Preferred Units,
shall be insufficient to pay in full the preferential amount
aforesaid and liquidating payments on any other class or series of Parity Units,
then such assets, or the proceeds thereof, shall be distributed among the General
Partner, in its capacity as the holder of such Series E Preferred Units, and the
holders of such other Parity Units ratably in accordance with the respective amounts
that would be payable on such Series E Preferred Units and such other Parity Units
if all amounts payable thereon were paid in full. For the purposes of this Section
3, (x) a consolidation or merger of the Partnership or the General Partner with one
or more partnerships, limited liability companies, corporations, real estate
investment trusts or other entities and (y) a sale, lease or conveyance of all or
substantially all of the Partnership’s property or business shall not be deemed to
be a liquidation, dissolution or winding up, voluntary or involuntary, of the
Partnership.

     (B)     Subject to the rights of the holders of Partnership Units of any series or
class ranking on a parity with or prior to the Series E Preferred Units upon any
liquidation, dissolution or winding up of the Partnership, after payment shall have
been made in full to the General Partner, in its capacity as the holder of the
Series E Preferred Units, as provided in this Section 3, any other series or class
or classes of Junior Units shall, subject to any respective terms and provisions
applying thereto, be entitled to receive any and all assets remaining to be paid or
distributed, and the General Partner, in its capacity as the holder of the Series E
Preferred Units, shall not be entitled to share therein.

L-3

 

     4.     Redemption Right. In connection with a redemption by the General
Partner of any or all of the Series E Preferred Shares (whether pursuant to Section
6 or Section 7 of the articles supplementary for the Series E Preferred Shares), the
Partnership shall provide cash to the General Partner for such purpose which shall
be equal to the redemption price of the Series E Preferred Shares to be redeemed and
one Series E Preferred Unit shall be canceled with respect to each Series E
Preferred Share so redeemed. From and after the date in which the Series E
Preferred Shares are redeemed, the Series E Preferred Units so canceled shall no
longer be outstanding and all rights hereunder, to distributions or otherwise, with
respect to such Series E Preferred Units shall cease

     5.     Conversion. The Series E Preferred Units are not convertible into
or exchangeable for any other property or securities of the Partnership.

     6.     Ranking. Any class or series of Partnership Units shall be deemed
to rank:

          (A)     prior to the Series E Preferred Units as to the payment of distributions or
as to distribution of assets upon liquidation, dissolution or winding up of the
Partnership, if the holders of such class or series of Partnership Units shall be
entitled to the receipt of distributions or of amounts distributable
upon liquidation, dissolution or winding up, as the case may be, in preference or
priority to the holders of Series E Preferred Units;

          (B)     on a parity with the Series E Preferred Units as to the payment of
distributions and as to the distribution of assets upon liquidation, dissolution or
winding up of the Partnership, whether or not the distribution rates, distribution
payment dates or redemption or liquidation prices per Partnership Unit be different
from those of the Series E Preferred Units, if the holders of such class or series
of Partnership Units and the Series E Preferred Units shall be entitled to the
receipt of distributions and of amounts distributable upon liquidation, dissolution
or winding up in proportion to their respective amounts of accrued and unpaid
distributions per Partnership Unit or liquidation preferences, without preference or
priority one over the other (“Parity Units”); as of the date hereof, the Series B
Preferred Units, the Series C Preferred Units and the Series D Preferred Units
constitute Parity Units;

          (C)     junior to the Series E Preferred Units as to the payment of distributions
or as to the distribution of assets upon liquidation, dissolution or winding up of
the Partnership, if such class or series of Partnership Units shall be Junior Units;
and

          (D)     junior to the Series E Preferred Units as to the payment of distributions
and as to the distribution of assets upon liquidation, dissolution or winding up of
the Partnership, if such class or series of Partnership Units shall be Fully Junior
Units.

     7.     Voting. Except as required by law, the General Partner, in its
capacity as the holder of the Series E Preferred Units, shall not be entitled to
vote at any meeting of the Partners or for any other purpose or otherwise to
participate in any action taken by the Partnership or the Partners, or to receive
notice of any meeting of the Partners.

L-4

 

     8.     Restriction on Ownership. The Series E Preferred Units shall be
owned and held solely by the General Partner.

     9.     Allocations. Allocations of the Partnership’s income, gain, loss and
deduction shall be allocated among holders of the Series E Preferred Units in
accordance with Article VI of the Agreement.

     10.     General. The rights of the General Partner, in its capacity as the
holder of the Series E Preferred Units, are in addition to and not in limitation on
any other rights or authority of the General Partner, in any other capacity, under
the Agreement. In addition, nothing contained in this Exhibit L shall be
deemed to limit or otherwise restrict any rights or authority of the General Partner
under
the Agreement, other than in its capacity as the holder of the Series E Preferred
Units.

* * * * *

L-5

 

TENTH AMENDMENT TO

THIRD AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

OF

COLONIAL REALTY LIMITED PARTNERSHIP

     THIS TENTH AMENDMENT TO THIRD AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF
COLONIAL REALTY LIMITED PARTNERSHIP (this “Tenth Amendment”), dated as of April 25, 2007, is
entered into by Colonial Properties Trust, as general partner (the “General Partner”) of Colonial
Realty Limited Partnership (the “Partnership”), for itself and on behalf of the limited partners of
the Partnership (the “Limited Partners”).

     WHEREAS, Section 7.1.A(7) of the Third Amended and Restated Agreement of Limited Partnership
of the Partnership (the “Partnership Agreement”) provides that the General Partner shall have the
power to distribute cash or other assets of the Partnership in accordance with the Partnership
Agreement;

     WHEREAS, Section 14.1.B(4) of the Partnership Agreement provides that the General Partner
shall have the power, without the consent of any Limited Partners, to amend certain provisions of
the Partnership Agreement, including Section 7.1.A(7), to reflect a change that is of an
inconsequential nature and does not adversely affect the Limited Partners in any material respect;

     WHEREAS, the Board of Trustees (the “Board”) of the General Partner has approved a strategic
plan that contemplates, among other things, the formation of two new Subsidiaries, DRA/CLP Office
LLC and OZ/CLP Retail LLC, the pro rata distribution of 85% of the common membership units of each
of these Subsidiaries to the Partners , and the sale by the General Partner, for cash, of the
common membership units in these two Subsidiaries that it receives in such distribution pursuant to
purchase agreements entered into prior to the time of such distribution;

     WHEREAS, the General Partner, in its capacity as general partner of the Partnership, seeks to
amend the Partnership Agreement to the extent necessary to permit the Partnership to make a pro
rata distribution of membership interests in the Subsidiaries referred to above to all Partners;
and

     WHEREAS, the Board has determined that the amendment to Section 7.1.A(7) set forth below is of
an inconsequential nature and does not adversely affect the Limited Partners in any material
respect.

 

 

     NOW, THEREFORE, in consideration of the in consideration of the premises and for other good
and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, the
General Partner hereby amends the Partnership Agreement, as follows:

     1. Distributions in Kind. Section 7.1.A(7) of the Partnership Agreement is hereby
amended to read in its entirety as follows:

	 	“(7)	 	the distribution of Partnership cash or other Partnership
assets in accordance with this Agreement, including distributions of equity
interests in Subsidiaries of the Partnership made on a pro rata basis to
holders of Common Units, provided that, in connection with the receipt of any
such distribution, the General Partner either shall (i) prior to receiving such
distribution, enter into a purchase and sale agreement, pursuant to its powers
under Article III of the Declaration of Trust, to dispose of such equity
interests or other Partnership assets that it receives in such distribution in
exchange for cash or (ii) distribute such equity interests or other Partnership
assets to the holders of REIT Shares;”

     2. Certain Capitalized Terms. All capitalized terms used in this Tenth Amendment and
not otherwise defined shall have the meanings assigned in the Partnership Agreement.

     3. Full Force and Effect. Except as modified herein, all terms and conditions of the
Partnership Agreement shall remain in full force and effect, which terms and conditions the General
Partner hereby ratifies and affirms.

(Signature appears on the following page.)

 

 

     IN WITNESS WHEREOF, the undersigned has executed this Tenth Amendment as of the date first set
forth above

	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	COLONIAL PROPERTIES TRUST,

as General Partner of

Colonial Realty Limited Partnership
	 
	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ John P. Rigrish
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	John P. Rigrish
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	Title:
	 	Chief Administrative OfficerEX-10.2 FIRST AMENDMENT TO CREDIT AGREEMENT

 

EXHIBIT 10.2

FIRST AMENDMENT TO CREDIT AGREEMENT

     THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this “First Amendment”) is dated as of the 2nd day
of June, 2006, among COLONIAL REALTY LIMITED PARTNERSHIP (“Borrower”), COLONIAL PROPERTIES TRUST,
an Alabama Trust (the “Guarantor”), WACHOVIA BANK, NATIONAL ASSOCIATION, as Administrative Agent
(the “Agent”), BANK OF AMERICA, N.A., as Syndication Agent, WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Co-Documentation Agent, CITICORP NORTH AMERICA, INC., as Co-Documentation Agent, AMSOUTH BANK,
as Co-Documentation Agent, PNC BANK, NATIONAL ASSOCIATION, as Co-Senior Managing Agent, and U.S.
BANK NATIONAL ASSOCIATION, as Co-Senior Managing Agent, and the lenders a party hereto
(collectively, the “Lenders”).

W I T N E S S E T H:

     WHEREAS, the Borrower, the Agent and the Lenders executed and delivered that certain Credit
Agreement, dated as of March 22, 2005 (the “Credit Agreement”);

     WHEREAS, the Borrower has requested, and the Agent and the Lenders have agreed to, certain
amendments to the Credit Agreement, subject to the terms and conditions hereof;

     NOW, THEREFORE, for and in consideration of the above premises and other good and valuable
consideration, the receipt and sufficiency of which hereby is acknowledged by the parties hereto,
the Borrower, the Guarantor, the Agent and the Lenders hereby covenant and agree as follows:

     1. Definitions. Unless otherwise specifically defined herein, each term used herein
which is defined in the Credit Agreement shall have the meaning assigned to such term in the Credit
Agreement. Each reference to “hereof”, “hereunder”, “herein” and “hereby” and each other similar
reference and each reference to “this Agreement” and each other similar reference contained in the
Credit Agreement shall from and after the date hereof refer to the Credit Agreement as amended
hereby.

     2. Modification of the Credit Agreement. The Borrower, the Agent and the Lenders do
hereby modify and amend the Credit Agreement as follows:

          (a) By deleting from the definition of Capitalization Rate in Section 1.1 of the Credit
Agreement the words “8.75% for office Properties” and inserting in lieu thereof the following:
“8.50% for office Properties”

          (b) By deleting in its entirety Section 9.1(b) of the Credit Agreement, and inserting in lieu
thereof the following: “Intentionally omitted;”;

 

 

          (c) By deleting in its entirety Section 9.1(c) of the Credit Agreement, and inserting in lieu
thereof the following:

               “(c) the Fixed Charge Coverage Ratio to be less than 1.50:1.00
at any time;”

          (d) By deleting in its entirety Section 9.1(e) of the Credit Agreement, and inserting in lieu
thereof the following: “Intentionally omitted;”;

          (e) By deleting in its entirety Section 9.3(a) of the Credit Agreement, and inserting in lieu
thereof the following:

               “(a) except as set forth below, there shall be no limitation on
Investments in Unimproved Land;”

          (f) By deleting in its entirety Section 9.3(b) of the Credit Agreement, and inserting in lieu
thereof the following:

               “(b) except as set forth below, there shall be no limitation on
Investments in Mortgage Receivables;”

          (g) By deleting in its entirety Section 9.3(c) of the Credit Agreement, and inserting in lieu
thereof the following:

               “(c) except as set forth below, there shall be no limitation on
Investments in Unconsolidated Affiliates; and”.

     3. Restatement of Representations and Warranties. The Borrower and Guarantor hereby
restate and renew each and every representation and warranty heretofore made by them in the Credit
Agreement and the other Loan Documents as fully as if made on the date hereof (except to the extent
such representations and warranties expressly relate to an earlier date) and with specific
reference to this First Amendment and all other loan documents executed and/or delivered in
connection herewith.

     4. References to Credit Agreement. All references in the Loan Documents to the Credit
Agreement shall be deemed a reference to the Credit Agreement, as modified and amended herein.

     5. Acknowledgment of the Borrower and Guarantor. The Borrower and Guarantor hereby
acknowledge, represent and agree that the Loan Documents, as modified and amended herein, remain in
full force and effect and constitute the valid and legally binding obligation of the Borrower and
Guarantor enforceable against the Borrower and Guarantor in accordance with their respective terms,
and that the execution and delivery of this First Amendment does not constitute, and shall not be
deemed to constitute, a release, waiver or satisfaction of the Borrower’s or Guarantor’s
obligations under the Loan Documents.

     6. No Default. By execution hereof, the Borrower and Guarantor certify that each of
them is and will be in compliance with all covenants under the Loan Documents after the execution
and delivery of this First Amendment, and that no Default or Event of Default has occurred and is
continuing.

2

 

     7. Waiver of Claims. The Borrower and Guarantor acknowledge, represent and agree that
none of the Borrower or Guarantor has any defenses, setoffs, claims, counterclaims or causes of
action of any kind or nature whatsoever with respect to the Loan Documents, the administration or
funding of the Loan or with respect to any acts or omissions of the Agent or any Lender, or any
past or present officers, agents or employees of the Agent or any Lender, and the Borrower and each
Guarantor does hereby expressly waive, release and relinquish any and all such defenses, setoffs,
claims, counterclaims and causes of action, if any.

     8. Ratification. Except as hereinabove set forth, all terms, covenants and provisions
of the Credit Agreement remain unaltered and in full force and effect, and the parties hereto do
hereby expressly ratify and confirm the Loan Documents and the Credit Agreement as modified and
amended herein. Nothing in this First Amendment shall be deemed or construed to constitute, and
there has not otherwise occurred, a novation, cancellation, satisfaction, release, extinguishment
or substitution of the indebtedness evidenced by the Notes or the other obligations of the Borrower
and Guarantor under the Loan Documents.

     9. Counterparts. This First Amendment may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so executed and
delivered (which may be by telecopier pursuant to Section 13 below) shall be deemed to be an
original and all of which counterparts, taken together, shall constitute but one and the same
instrument.

     10. Section References. Section titles and references used in this First Amendment
shall be without substantive meaning or content of any kind whatsoever and are not a part of the
agreements among the parties hereto evidenced hereby.

     11. Further Assurances. The Borrower and Guarantor agree to take such further actions
as the Agent shall reasonably request in connection herewith to evidence the amendments herein
contained.

     12. Governing Law. This First Amendment shall be governed by and construed and
interpreted in accordance with, the laws of the State of Georgia.

     13. Conditions Precedent. This First Amendment shall become effective only upon (i)
execution hereof by the Agent, and (ii) execution and return to counsel for the Agent at the
telecopier number set forth below of a copy hereof by the Borrower, the Guarantor and the Requisite
Lenders. Executed copies hereof shall be sent by facsimile to counsel for the Agent, McKenna Long
& Aldridge, LLP, Attention: William F. Timmons, at Telecopier number 404-527-4198, Confirmation
number 404-527-8380.

[SIGNATURES COMMENCE ON NEXT PAGE]

3

 

	 	 	 	 	 	 	 
	 	 	BORROWER:	 	 
	 
	 	 	 	 	 	 
	 	 	COLONIAL REALTY LIMITED PARTNERSHIP, a
	 	 	Delaware limited partnership
	 
	 	 	 	 	 	 
	 	 	By:	 	 Colonial Properties Trust, an Alabama Trust, its
	 	 	 	 	General Partner
	 
	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Jerry A. Brewer
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Jerry A. Brewer
	 

	 	 	 	Title:
	 	 Senior Vice President
	 
	 	 	 	 	 	 
	 	 	GUARANTOR:	 	 
	 
	 	 	 	 	 	 
	 	 	COLONIAL PROPERTIES TRUST, an Alabama Trust
	 
	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Jerry A. Brewer
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	 Jerry A. Brewer
	 

	 	 	 	Title:
	 	Senior Vice President

[Signatures Continued on Next Page]

4

 

[Signature Page to First Amendment to Credit Agreement with Colonial Realty Limited Partnership]

	 	 	 	 	 
	 	 	LENDERS:
	 
	 	 	 	 
	 	 	WACHOVIA BANK, NATIONAL ASSOCIATION, as
	 	 	Agent and as a Lender
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Amit V. Khimji
	 

	 	 	 	 
	 

	 	Name:
	 	Amit V. Khimji
	 

	 	Title:
	 	 Vice President
	 
	 	 	 	 
	 	 	BANK OF AMERICA,
N.A., as Syndication Agent and as a Lender
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Steven P. Renwick
	 

	 	 	 	 
	 

	 	Name:
	 	Steven P. Renwick
	 

	 	Title:
	 	 Senior Vice President
	 
	 	 	 	 
	 	 	WELLS FARGO BANK, NATIONAL ASSOCIATION,
	 	 	as Co-Documentation Agent and as a Lender
	 
	 	 	 	 
	 

	 	By:
	 	/s/ John S. Misiura
	 

	 	 	 	 
	 

	 	Name:
	 	John S. Misiura
	 

	 	Title:
	 	 Senior Vice President
	 
	 	 	 	 
	 	 	CITICORP NORTH
AMERICA, INC., as Co-Documentation 

Agent and as a Lender
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Niraj R. Shah
	 

	 	 	 	 
	 

	 	Name:
	 	Niraj R. Shah
	

	 	Title:
	 	Vice President

[Signatures Continued On Next Page]

5

 

[Signature Page to First Amendment to Credit Agreement with Colonial Realty Limited Partnership]

	 	 	 	 	 
	 	 	AMSOUTH BANK, as Co-Documentation Agent and as a
	 	 	Lender
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Kerri Raines
	 

	 	 	 	 
	 

	 	Name:
	 	Kerri Raines
	 

	 	Title:
	 	Assistant Vice President
	 
	 	 	 	 
	 	 	PNC BANK, NATIONAL ASSOCIATION,
	 	 	as Co-Senior Managing Agent and as a Lender
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Wayne P. Robertson
	 

	 	 	 	 
	 

	 	Name:
	 	Wayne P. Robertson
	 

	 	Title:
	 	 Senior Vice President
	 
	 	 	 	 
	 	 	U.S. BANK NATIONAL ASSOCIATION,
	 	 	as Co-Senior Managing Agent and as a Lender
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 
	 
	 	 	UBS LOAN FINANCE LLC
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Richard L. Tavrow
	 

	 	 	 	 
	 

	 	Name:
	 	Ricahrd L. Tavrow
	 

	 	Title:
	 	Director, Banking Products Services, US
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Iria R. Otsa
	 

	 	 	 	 
	 

	 	Name:
	 	Iria R. Otsa
	 

	 	Title:
	 	Assoc. Director, Banking Products Services, US

[Signatures Continued on Next Page]

6

 

[Signature Page to First Amendment to Credit Agreement with Colonial Realty Limited Partnership]

	 	 	 	 	 
	 	 	COMERICA BANK
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Casey L. Ostrander
	 

	 	 	 	 
	 

	 	Name:
	 	Casey L. Ostrander
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 	 	AIB DEBT MANAGEMENT LIMITED
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Anthony O’Reilly
	 

	 	 	 	 
	 

	 	Name:
	 	Anthony O’Reilly
	 

	 	Title:
	 	Senior Vice President
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Germaine Reusch
	 

	 	 	 	 
	 

	 	Name:
	 	Germaine Reusch
	 

	 	Title:
	 	Director
	 
	 	 	 	 
	 	 	PEOPLE’S BANK
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Anne Kuchinski
	 

	 	 	 	 
	 

	 	Name:
	 	Anne Kuchinski
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Susan M. Tate
	 

	 	 	 	 
	 

	 	Name:
	 	Susan M. Tate
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 	 	COMPASS BANK
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Johanna Duke Paley
	 

	 	 	 	 
	 

	 	Name:
	 	Johanna Duke Paley
	 

	 	Title:
	 	Senior Vice President

[Signatures Continued on Next Page]

7

 

[Signature Page to First Amendment to Credit Agreement with Colonial Realty Limited Partnership]

	 	 	 	 	 
	 	 	CHANG HWA COMMERCIAL BANK, LTD.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Jim C.Y. Chen
	 

	 	 	 	 
	 

	 	Name:
	 	Jim C.Y. Chen
	 

	 	Title:
	 	Vice President & General Manager
	 
	 	 	 	 
	 	 	BRANCH BANKING AND TRUST COMPANY
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Robert M. Searson
	 

	 	 	 	 
	 

	 	Name:
	 	Robert M. Searson
	 

	 	Title:
	 	Senior Vice President
	 
	 	 	 	 
	 	 	BANK OF CHINA, NEW YORK
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Xiaoiing Li
	 

	 	 	 	 
	 

	 	Name:
	 	Xiaoiing Li
	 

	 	Title:
	 	General Manager
	 
	 	 	 	 
	 	 	BANK HAPOALIM B.M.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Shaun Breidbart
	 

	 	 	 	 
	 

	 	Name:
	 	Shaun Breidbart
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Charles McLaughlin
	 

	 	 	 	 
	 

	 	Name:
	 	Charles McLaughlin
	 

	 	Title:
	 	Senior Vice President
	 
	 	 	 	 
	 	 	THE GOVERNOR AND COMPANY OF THE BANK
	 	 	OF IRELAND
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Noelle McGrath
	 

	 	 	 	 
	 

	 	Name:
	 	Noelle McGrath
	 

	 	Title:
	 	Authorised Signatory
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Carla Ryan
	 

	 	 	 	 
	 

	 	Name:
	 	Carla Ryan
	 

	 	Title:
	 	Authorised Signatory

[Signatures Continued on Next Page]

8

 

[Signature Page to First Amendment to Credit Agreement with Colonial Realty Limited Partnership]

	 	 	 	 	 
	 	 	UNITED OVERSEAS BANK LIMITED, NEW YORK
	 	 	AGENCY
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Kwong Yew Wong
	 

	 	 	 	 
	 

	 	Name:
	 	Wong, Kwong Yew
	 

	 	Title:
	 	FVP & General Manager
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Mario Sheng
	 

	 	 	 	 
	 

	 	Name:
	 	Mario Sheng
	 

	 	Title:
	 	Assistant Vice President
	 
	 	 	 	 
	 	 	THE BANK OF TOKYO-MITSUBISHI UFJ, LIMITED
	 	 	(successor by merger to UFJ BANK LIMITED)
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Yoichi Orikasa
	 

	 	 	 	 
	 

	 	Name:
	 	Yoichi Orikasa
	 

	 	Title:
	 	Vice President & Manager
	 
	 	 	 	 
	 	 	FIRST COMMERCIAL BANK
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bruce M.J. Ju
	 

	 	 	 	 
	 

	 	Name:
	 	Bruce M.J. Ju
	 

	 	Title:
	 	Vice President & General Manager
	 
	 	 	 	 
	 	 	FIRST HORIZON BANK, a division of FIRST
	 	 	TENNESSEE BANK, NA
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Kenneth W. Rub
	 

	 	 	 	 
	 

	 	Name:
	 	Kenneth W. Rub
	 

	 	Title:
	 	Vice President

9

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