Document:

exv10w1

Exhibit 10.1

AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

OF

YOUNAN PROPERTIES, L.P.

a Maryland limited partnership

 

THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED

UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),OR

THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD,

TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH

REGISTRATION, UNLESS IN THE OPINION OF COUNSEL SATISFACTORY TO THE

PARTNERSHIP THE PROPOSED SALE, TRANSFER OR OTHER DISPOSITION MAY BE

EFFECTED WITHOUT REGISTRATION UNDER THE SECURITIES ACT AND UNDER

APPLICABLE STATE SECURITIES OR “BLUE SKY” LAWS.

dated as of                                         , 2010

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 1 DEFINED TERMS	 	 	1	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 2 ORGANIZATIONAL MATTERS	 	 	19	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 2.1	 	Formation	 	 	19	 
	 
	 	Section 2.2	 	Name	 	 	19	 
	 
	 	Section 2.3	 	Principal Office and Resident Agent; Principal Executive Office	 	 	20	 
	 
	 	Section 2.4	 	Power of Attorney	 	 	20	 
	 
	 	Section 2.5	 	Term	 	 	21	 
	 
	 	Section 2.6	 	Partnership Interests Are Securities	 	 	21	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 3 PURPOSE	 	 	21	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 3.1	 	Purpose and Business	 	 	21	 
	 
	 	Section 3.2	 	Powers	 	 	22	 
	 
	 	Section 3.3	 	Partnership Only for Purposes Specified	 	 	22	 
	 
	 	Section 3.4	 	Representations and Warranties by the Partners	 	 	22	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 4 CAPITAL CONTRIBUTIONS	 	 	25	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 4.1	 	Capital Contributions of the Partners	 	 	25	 
	 
	 	Section 4.2	 	Issuances of Additional Partnership Interests	 	 	25	 
	 
	 	Section 4.3	 	Additional Funds and Capital Contributions	 	 	26	 
	 
	 	Section 4.4	 	Stock Option Plans and Equity Plans	 	 	28	 
	 
	 	Section 4.5	 	Dividend Reinvestment Plan, Cash Option Purchase Plan, Stock Incentive Plan or Other Plan	 	 	30	 
	 
	 	Section 4.6	 	No Interest; No Return	 	 	30	 
	 
	 	Section 4.7	 	Conversion or Redemption of Capital Shares	 	 	30	 
	 
	 	Section 4.8	 	Other Contribution Provisions	 	 	31	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 5 DISTRIBUTIONS	 	 	31	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 5.1	 	Requirement and Characterization of Distributions	 	 	31	 
	 
	 	Section 5.2	 	Distributions in Kind	 	 	32	 
	 
	 	Section 5.3	 	Amounts Withheld	 	 	32	 
	 
	 	Section 5.4	 	Distributions upon Liquidation	 	 	32	 
	 
	 	Section 5.5	 	Distributions to Reflect Additional Partnership Units	 	 	32	 
	 
	 	Section 5.6	 	Restricted Distributions	 	 	32	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 6 ALLOCATIONS	 	 	32	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 6.1	 	Timing and Amount of Allocations of Net Income and Net Loss	 	 	32	 

i

 

	 	 	 	 	 	 	 	 	 
	 
	 	Section 6.2	 	General Allocations	 	 	33	 
	 
	 	Section 6.3	 	Additional Allocation Provisions	 	 	34	 
	 
	 	Section 6.4	 	Regulatory Allocation Provisions	 	 	35	 
	 
	 	Section 6.5	 	Tax Allocations	 	 	37	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 7 MANAGEMENT AND OPERATIONS OF BUSINESS	 	 	38	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 7.1	 	Management	 	 	38	 
	 
	 	Section 7.2	 	Certificate of Limited Partnership	 	 	42	 
	 
	 	Section 7.3	 	Restrictions on General Partner’s Authority	 	 	42	 
	 
	 	Section 7.4	 	Reimbursement of the General Partner	 	 	44	 
	 
	 	Section 7.5	 	Outside Activities of the General Partner	 	 	45	 
	 
	 	Section 7.6	 	Transactions with Affiliates	 	 	46	 
	 
	 	Section 7.7	 	Indemnification	 	 	47	 
	 
	 	Section 7.8	 	Liability of the General Partner	 	 	49	 
	 
	 	Section 7.9	 	Other Matters Concerning the General Partner	 	 	50	 
	 
	 	Section 7.10	 	Title to Partnership Assets	 	 	51	 
	 
	 	Section 7.11	 	Reliance by Third Parties	 	 	51	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 8 RIGHTS AND OBLIGATIONS OF LIMITED PARTNERS	 	 	52	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 8.1	 	Limitation of Liability	 	 	52	 
	 
	 	Section 8.2	 	Management of Business	 	 	52	 
	 
	 	Section 8.3	 	Outside Activities of Limited Partners	 	 	52	 
	 
	 	Section 8.4	 	Return of Capital	 	 	53	 
	 
	 	Section 8.5	 	Rights of Limited Partners Relating to the Partnership	 	 	53	 
	 
	 	Section 8.6	 	Partnership Right to Call Limited Partner Interests	 	 	54	 
	 
	 	Section 8.7	 	Rights as Objecting Partner	 	 	54	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 9 BOOKS, RECORDS, ACCOUNTING AND REPORTS	 	 	54	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 9.1	 	Records and Accounting	 	 	54	 
	 
	 	Section 9.2	 	Partnership Year	 	 	54	 
	 
	 	Section 9.3	 	Reports	 	 	55	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 10 TAX MATTERS	 	 	55	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 10.1	 	Preparation of Tax Returns	 	 	55	 
	 
	 	Section 10.2	 	Tax Elections	 	 	55	 
	 
	 	Section 10.3	 	Tax Matters Partner	 	 	56	 
	 
	 	Section 10.4	 	Withholding	 	 	57	 
	 
	 	Section 10.5	 	Organizational Expenses	 	 	57	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 11 PARTNER TRANSFERS AND WITHDRAWALS	 	 	57	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 11.1	 	Transfer	 	 	57	 
	 
	 	Section 11.2	 	Transfer of General Partner’s Partnership Interest	 	 	58	 
	 
	 	Section 11.3	 	Limited Partners’ Rights to Transfer	 	 	59	 

ii

 

	 	 	 	 	 	 	 	 	 
	 
	 	Section 11.4	 	Admission of Substituted Limited Partners	 	 	62	 
	 
	 	Section 11.5	 	Assignees	 	 	62	 
	 
	 	Section 11.6	 	General Provisions	 	 	63	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 12 ADMISSION OF PARTNERS	 	 	65	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 12.1	 	Admission of Successor General Partner	 	 	65	 
	 
	 	Section 12.2	 	Admission of Additional Limited Partners	 	 	65	 
	 
	 	Section 12.3	 	Amendment of Agreement and Certificate of Limited Partnership	 	 	66	 
	 
	 	Section 12.4	 	Limit on Number of Partners	 	 	66	 
	 
	 	Section 12.5	 	Admission	 	 	66	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 13 DISSOLUTION, LIQUIDATION AND TERMINATION	 	 	66	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 13.1	 	Dissolution	 	 	66	 
	 
	 	Section 13.2	 	Winding Up	 	 	67	 
	 
	 	Section 13.3	 	Deemed Contribution and Distribution	 	 	69	 
	 
	 	Section 13.4	 	Rights of Holders	 	 	69	 
	 
	 	Section 13.5	 	Notice of Dissolution	 	 	69	 
	 
	 	Section 13.6	 	Cancellation of Certificate of Limited Partnership	 	 	69	 
	 
	 	Section 13.7	 	Reasonable Time for Winding-Up	 	 	69	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 14 PROCEDURES FOR ACTIONS AND CONSENTS OF PARTNERS; AMENDMENTS; MEETINGS	 	 	70	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 14.1	 	Procedures for Actions and Consents of Partners	 	 	70	 
	 
	 	Section 14.2	 	Amendments	 	 	70	 
	 
	 	Section 14.3	 	Actions and Consents of the Partners	 	 	70	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 15 GENERAL PROVISIONS	 	 	71	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 15.1	 	Redemption Rights of Qualifying Parties	 	 	71	 
	 
	 	Section 15.2	 	Addresses and Notice	 	 	75	 
	 
	 	Section 15.3	 	Titles and Captions	 	 	75	 
	 
	 	Section 15.4	 	Pronouns and Plurals	 	 	75	 
	 
	 	Section 15.5	 	Further Action	 	 	75	 
	 
	 	Section 15.6	 	Binding Effect	 	 	75	 
	 
	 	Section 15.7	 	Waiver	 	 	76	 
	 
	 	Section 15.8	 	Counterparts	 	 	76	 
	 
	 	Section 15.9	 	Applicable Law; Consent to Jurisdiction; Waiver of Jury Trial	 	 	76	 
	 
	 	Section 15.10	 	Entire Agreement	 	 	77	 
	 
	 	Section 15.11	 	Invalidity of Provisions	 	 	77	 
	 
	 	Section 15.12	 	Limitation to Preserve REIT Status	 	 	77	 
	 
	 	Section 15.13	 	No Partition	 	 	78	 
	 
	 	Section 15.14	 	No Third-Party Rights Created Hereby	 	 	78	 
	 
	 	Section 15.15	 	No Rights as Stockholders	 	 	78	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE 16 LTIP UNITS	 	 	79	 

iii

 

	 	 	 	 	 	 	 	 	 
	 
	 	Section 16.1	 	Designation	 	 	79	 
	 
	 	Section 16.2	 	Vesting	 	 	79	 
	 
	 	Section 16.3	 	Adjustments	 	 	79	 
	 
	 	Section 16.4	 	Distributions	 	 	80	 
	 
	 	Section 16.5	 	Allocations	 	 	81	 
	 
	 	Section 16.6	 	Transfers	 	 	81	 
	 
	 	Section 16.7	 	Redemption	 	 	81	 
	 
	 	Section 16.8	 	Legend	 	 	81	 
	 
	 	Section 16.9	 	Conversion to Partnership Common Units	 	 	81	 
	 
	 	Section 16.10	 	Voting	 	 	84	 
	 
	 	Section 16.11	 	Section 83 Safe Harbor	 	 	84	 

iv

 

Exhibits List

	 	 	 	 	 

	Exhibit A

	 	PARTNERS AND PARTNERSHIP UNITS
	 	A-1
	 
	 	 	 	 
	Exhibit B

	 	EXAMPLES REGARDING ADJUSTMENT FACTOR
	 	B-1
	 
	 	 	 	 
	Exhibit C

	 	NOTICE OF REDEMPTION
	 	C-1
	 
	 	 	 	 
	Exhibit D

	 	CONVERSION NOTICE
	 	D-1
	 
	 	 	 	 
	Exhibit E

	 	FORCED CONVERSION NOTICE
	 	E-1

iv

 

AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

OF YOUNAN PROPERTIES, L.P.

          THIS AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF YOUNAN PROPERTIES, L.P., dated
as of                     , 2010, is made and entered into by and among YOUNAN PROPERTIES, INC., a Maryland
corporation, as the General Partner and the Persons whose names are set forth on Exhibit A
attached hereto, as limited partners, and any Additional Limited Partner that is admitted from time
to time to the Partnership and listed on Exhibit A attached hereto.

          WHEREAS, a Certificate of Limited Partnership of the Partnership was filed with the State
Department of Assessments and Taxation of Maryland on March 26, 2010 (the “Formation Date”), and
the initial general partner and limited partners of the Partnership entered into an original
agreement of limited partnership of the Partnership effective as of the Formation Date (the
“Original Partnership Agreement”); and

          WHEREAS, the Partners (as hereinafter defined) now desire to amend and restate the Original
Partnership Agreement and admit the Persons whose names are set forth on Exhibit A attached
hereto as limited partners of the Partnership by entering into this Agreement (as hereinafter
defined);

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

ARTICLE 1

DEFINED TERMS

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

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

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

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

          “Additional Limited Partner” means a Person who is admitted to the Partnership as a limited
partner pursuant to the Act and Section 4.2 and Section 12.2 hereof and who is shown as such on the
books and records of the Partnership.

          “Adjusted Capital Account” means, with respect to any Partner, the balance in such Partner’s
Capital Account as of the end of the relevant Partnership Year or other applicable period, after
giving effect to the following adjustments:

 

 

          (i) increase such Capital Account by any amounts that such Partner is obligated to
restore pursuant to this Agreement upon liquidation of such Partner’s Partnership Interest
or that such Person is deemed to be obligated to restore pursuant to Regulations Section
1.704-1(b)(2)(ii)(c) or the penultimate sentence of each of Regulations Sections
1.704-2(g)(1) and 1.704-2(i)(5); and

          (ii) decrease such Capital Account by the items described in Regulations Section
1.704-1(b)(2)(ii)(d)(4), (5) and (6).

          The foregoing definition of “Adjusted Capital Account” 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 or
other applicable period.

          “Adjustment Factor” means 1.0; provided, however, that in the event that:

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

          (ii) the General Partner distributes any rights, options or warrants to all holders of
its REIT Shares to subscribe for or to purchase or to otherwise acquire REIT Shares, or
other securities or rights convertible into, exchangeable for or exercisable for REIT Shares
(other than REIT Shares issuable pursuant to a Qualified DRIP/COPP), at a price per share
less than the Value of a REIT Share on the record date for such distribution (each a
“Distributed Right”), then, as of the distribution date of such Distributed Rights or, if
later, the time such Distributed Rights become exercisable, the Adjustment Factor shall be
adjusted by multiplying the Adjustment Factor previously in effect by a fraction (a) the
numerator of which shall be the number of REIT Shares issued and outstanding on the record
date (or, if later, the date such Distributed Rights become exercisable) plus the maximum
number of REIT Shares purchasable under such Distributed Rights and (b) the denominator of
which shall be the number of REIT Shares issued and outstanding on the record date (or, if
later, the date such Distributed Rights become exercisable) plus a fraction (1) the
numerator of which is the maximum number

2

 

of REIT Shares purchasable under such Distributed Rights times the minimum purchase
price per REIT Share under such Distributed Rights and (2) the denominator of which is the
Value of a REIT Share as of the record date (or, if later, the date such Distributed Rights
become exercisable); provided, however, that, if any such Distributed Rights expire or
become no longer exercisable, then the Adjustment Factor shall be adjusted, effective
retroactive to the date of distribution of the Distributed Rights, to reflect a reduced
maximum number of REIT Shares or any change in the minimum purchase price for the purposes
of the above fraction; and

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

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

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

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

          “Agreement” means this Amended and Restated Limited Partnership Agreement of Younan
Properties, L.P., as now or hereafter amended, restated, modified, supplemented or replaced.

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

3

 

          “Appraisal” means, with respect to any assets, the written opinion of an independent third
party experienced in the valuation of similar assets, selected by the General Partner. Such opinion
may be in the form of an opinion by such independent third party that the value for such property
or asset as set by the General Partner is fair, from a financial point of view, to the Partnership.

          “Assignee” means a Person to whom a Partnership Interest has 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 hereof.

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

          (i) the sum, without duplication, of:

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

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

          (3) the amount of any reduction in reserves of the Partnership referred to in
clause (ii)(6) below (including, without limitation, reductions resulting because
the General Partner determines such amounts are no longer necessary),

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

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

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

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

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

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

4

 

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

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

          (6) the amount of any increase in reserves (including, without limitation,
working capital reserves) established during such period that the General Partner
determines are necessary or appropriate in its sole and absolute discretion,

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

          (8) 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 (a) any cash received or reductions
in reserves, or take into account any disbursements made, or reserves established, after
dissolution and the commencement of the liquidation and winding up of the Partnership or (b) any
Capital Contributions, whenever received or any payments, expenditures or investments made with
such Capital Contributions.

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

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

          (i) To each Partner’s Capital Account, there shall be added such Partner’s Capital
Contributions, such Partner’s distributive share of Net Income and any items in the nature
of income or gain that are specially allocated pursuant to Section 6.3 or 6.4 hereof, and
the amount of any Partnership liabilities assumed by such Partner or that are secured by any
property distributed to such Partner.

          (ii) From each Partner’s Capital Account, there shall be subtracted the amount of cash
and the Gross Asset Value of any Partnership property distributed to such Partner pursuant
to any provision of this Agreement, such Partner’s distributive share of Net Losses and any
items in the nature of expenses or losses that are specially allocated pursuant to Section
6.3 or 6.4 hereof, and the amount of any liabilities of such Partner assumed by the
Partnership or that are secured by any property contributed by such Partner to the
Partnership (except to the extent already reflected in the amount of such Partner’s Capital
Contribution).

5

 

          (iii) In the event any interest in the Partnership is Transferred in accordance with
the terms of this Agreement (which Transfer does not result in the termination of the
Partnership for U.S. federal income tax purposes), the transferee shall succeed to the
Capital Account of the transferor to the extent that it relates to the Transferred interest.

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

          (v) The provisions of this Agreement relating to the maintenance of Capital Accounts
are intended to comply with Regulations promulgated under Section 704 of the Code, and shall
be interpreted and applied in a manner consistent with such Regulations. If the General
Partner shall determine that it is necessary or prudent to modify the manner in which the
Capital Accounts are maintained in order to comply with such Regulations, the General
Partner may make such modification, provided that such modification is not likely to have
any material effect on the amounts distributable to any Partner pursuant to Article 13
hereof upon the dissolution of the Partnership. The General Partner may, in its sole
discretion, (a) make any adjustments that are necessary or appropriate to maintain equality
between the Capital Accounts of the Partners and the amount of Partnership capital reflected
on the Partnership’s balance sheet, as computed for book purposes, in accordance with
Regulations Section 1.704-1(b)(2)(iv)(q) and (b) make any appropriate modifications in the
event that unanticipated events might otherwise cause this Agreement not to comply with
Regulations Section 1.704-1(b) or Section 1.704-2.

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

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

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

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

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

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

          “Closing Price” has the meaning set forth in the definition of “Value.”

          “Code” means the Internal Revenue Code of 1986, as amended and in effect from time to time or
any successor statute thereto, as interpreted by the applicable Regulations thereunder.

6

 

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 Economic Balance” means (i) the Capital Account balance of the General Partner,
plus the amount of the General Partner’s share of any Partner Minimum Gain or Partnership Minimum
Gain, in either case to the extent attributable to the General Partner’s ownership of Partnership
Common Units and computed on a hypothetical basis after taking into account all allocations through
the date on which any allocation is made under Section 6.2.D hereof, divided by (ii) the number of
the General Partner’s Partnership Common Units.

          “Consent” means the consent to, approval of, or vote in favor of a proposed action by a
Partner given in accordance with Article 14 hereof.

          “Consent of the General Partner” means the Consent of the sole General Partner, which Consent,
except as otherwise specifically required by this Agreement, may be obtained prior to or after the
taking of any action for which it is required by this Agreement and may be given or withheld by the
General Partner in its sole and absolute discretion.

          “Consent of the Limited Partners” means the Consent of a Majority in Interest of the Limited
Partners, which Consent shall be obtained prior to the taking of any action for which it is
required by this Agreement and, except as otherwise provided in this Agreement, may be given or
withheld by each Limited Partner in its sole and absolute discretion.

          “Consent of the Partners” means the Consent of the General Partner and the Consent of a
Majority in Interest of the Partners, which Consent shall be obtained prior to the taking of any
action for which it is required by this Agreement and, except as otherwise provided in this
Agreement, may be given or withheld by the General Partner or the Limited Partners in their sole
and absolute discretion; provided, however, that, if any such action affects only certain classes
or series of Partnership Interests, “Consent of the Partners” means the Consent of the General
Partner and the Consent of a Majority in Interest of the Partners of the affected classes or series
of Partnership Interests.

          “Contributed Property” means each Property or other asset, in such form as may be permitted by
the Act, but excluding cash, contributed or deemed contributed to the Partnership (or deemed
contributed by the Partnership to a “new” partnership pursuant to Code Section 708).

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

7

 

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

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

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

          “Disregarded Entity” means, with respect to any Person, (i) any “qualified REIT subsidiary”
(within the meaning of Code Section 856(i)(2)) of such Person, (ii) any entity treated as a
disregarded entity for Federal income tax purposes with respect to such Person, or (iii) any
grantor trust if the sole owner of the assets of such trust for Federal income tax purposes is such
Person.

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

          “Economic Capital Account Balance” means, with respect to a Holder of LTIP Units, its Capital
Account balance, plus the amount of its share of any Partner Minimum Gain or Partnership Minimum
Gain, in either case to the extent attributable to its ownership of LTIP Units.

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

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

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

8

 

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

          “Fourteen-Month Period” means (a) as to an Original Limited Partner or any Assignee of an
Original Limited Partner that is a Qualifying Party, a fourteen-month period ending on the day
before the first fourteen-month anniversary of the date of this Agreement and (b) as to any other
Qualifying Party, a fourteen-month period ending on the day before the first fourteen-month
anniversary of such Qualifying Party’s first becoming a Holder of Partnership Common Units;
provided, however, that the General Partner may, in its sole and absolute discretion, by written
agreement with a Qualifying Party, shorten or lengthen the first Fourteen-Month Period to a period
of shorter or longer than fourteen (14) months with respect to a Qualifying Party other than an
Original Limited Partner or an Assignee of an Original Limited Partner.

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

          “General Partner” means Younan Properties, Inc. and its successors and assigns as a general
partner of the Partnership, in each case, that is admitted from time to time to the Partnership as
a general partner pursuant to the Act and this Agreement and is listed as a general partner on
Exhibit A, as such Exhibit A may be amended from time to time, in such Person’s
capacity as a general partner of the Partnership.

          “General Partner Interest” means the entire Partnership Interest held by a General Partner
hereof, which Partnership Interest may be expressed as a number of Partnership Common Units,
Partnership Preferred Units or any other Partnership Units.

          “Gross Asset Value” means, with respect to any asset, the asset’s adjusted basis for federal
income tax purposes, except as follows:

          (a) The initial Gross Asset Value of any asset contributed by a Partner to the
Partnership shall be the gross fair market value of such asset on the date of contribution,
as determined by the General Partner and agreed to by the contributing Person.

          (b) The Gross Asset Values of all Partnership assets immediately prior to the
occurrence of any event described in clauses (i) through (v) below shall be adjusted to
equal their respective gross fair market values, as determined by the General Partner using
such reasonable method of valuation as it may adopt, as of the following times:

          (i) the acquisition of an additional interest in the Partnership (other than in
connection with the execution of this Agreement but including, without limitation,
acquisitions pursuant to Section 4.2 hereof or contributions or deemed contributions
by the General Partner pursuant to Section 4.2 hereof) by a new or existing Partner
in exchange for more than a de minimis Capital Contribution, if the General Partner
reasonably determines that such adjustment is necessary or

9

 

appropriate to reflect the relative economic interests of the Partners in the
Partnership;

          (ii) the distribution by the Partnership to a Partner of more than a de minimis
amount of Partnership property as consideration for an interest in the Partnership
if the General Partner reasonably determines that such adjustment is necessary or
appropriate to reflect the relative economic interests of the Partners in the
Partnership;

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

          (iv) the grant of an interest in the Partnership (other than a de minimis
interest) as consideration for the provision of services to or for the benefit of
the Partnership by an existing Partner acting in a partner capacity, or by a new
Partner acting in a partner capacity or in anticipation of becoming a Partner of the
Partnership (including the grant of an LTIP Unit), if the General Partner reasonably
determines that such adjustment is necessary or appropriate to reflect the relative
economic interests of the Partners in the Partnership; and

          (v) at such other times as the General Partner shall reasonably determine
necessary or advisable in order to comply with Regulations Sections 1.704-1(b) and
1.704-2.

          (c) The Gross Asset Value of any Partnership asset distributed to a Partner shall be
the gross fair market value of such asset on the date of distribution, as determined by the
distributee and the General Partner; provided, however, that if the distributee is the
General Partner or if the distributee and the General Partner cannot agree on such a
determination, such gross fair market value shall be determined by Appraisal.

          (d) The Gross Asset Values of Partnership assets shall be increased (or decreased) to
reflect any adjustments to the adjusted basis of such assets pursuant to Code Section 734(b)
or Code Section 743(b), but only to the extent that such adjustments are taken into account
in determining Capital Accounts pursuant to Regulations Section 1.704-1(b)(2)(iv)(m);
provided, however, that Gross Asset Values shall not be adjusted pursuant to this subsection
(d) to the extent that the General Partner reasonably determines that an adjustment pursuant
to subsection (b) above is necessary or appropriate in connection with a transaction that
would otherwise result in an adjustment pursuant to this subsection (d).

          (e) If the Gross Asset Value of a Partnership asset has been determined or adjusted
pursuant to subsection (a), subsection (b) or subsection (d) above, such Gross Asset Value
shall thereafter be adjusted by the Depreciation taken into account with respect to such
asset for purposes of computing Net Income and Net Losses.

          (f) If any unvested LTIP Units are forfeited, as described in Section 16.2.B, upon such
forfeiture, the Gross Asset Value of the Partnership’s assets shall be reduced by the

10

 

amount of any reduction of such Partner’s Capital Account attributable to the
forfeiture of such LTIP Units.

          “Hart-Scott-Rodino Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended.

          “Holder” means either (a) a Partner or (b) an Assignee owning a Partnership Interest.

          “Incapacity” or “Incapacitated” means: (i) as to any Partner who is an individual, death,
total physical disability or entry by a court of competent jurisdiction adjudicating such Partner
incompetent to manage his or her person or his or her estate; (ii) as to any Partner that is a
corporation or limited liability company, the filing of a certificate of dissolution, or its
equivalent, for the corporation or the revocation of its charter; (iii) as to any Partner that is a
partnership, the dissolution and commencement of winding up of the partnership; (iv) as to any
Partner that is an estate, the distribution by the fiduciary of the estate’s entire interest in the
Partnership; (v) as to any trustee of a trust that is a Partner, the termination of the trust (but
not the substitution of a new trustee); or (vi) as to any Partner, the bankruptcy of such Partner.
For purposes of this definition, bankruptcy of a Partner shall be deemed to have occurred when (a)
the Partner commences a voluntary proceeding seeking liquidation, reorganization or other relief of
or against such Partner under any bankruptcy, insolvency or other similar law now or hereafter in
effect, (b) the Partner is adjudged as bankrupt or insolvent, or a final and non-appealable order
for relief under any bankruptcy, insolvency or similar law now or hereafter in effect has been
entered against the Partner, (c) the Partner executes and delivers a general assignment for the
benefit of the Partner’s creditors, (d) the Partner files an answer or other pleading admitting or
failing to contest the material allegations of a petition filed against the Partner in any
proceeding of the nature described in clause (b) above, (e) the Partner seeks, consents to or
acquiesces in the appointment of a trustee, receiver or Liquidator for the Partner or for all or
any substantial part of the Partner’s properties, (f) any proceeding seeking liquidation,
reorganization or other relief under any bankruptcy, insolvency or other similar law now or
hereafter in effect has not been dismissed within one hundred twenty (120) days after the
commencement thereof, (g) the appointment without the Partner’s consent or acquiescence of a
trustee, receiver or liquidator has not been vacated or stayed within ninety (90) days of such
appointment, or (h) an appointment referred to in clause (g) above is not vacated within ninety
(90) days after the expiration of any such stay.

          “Indemnitee” means (i) any Person made, or threatened to be made, a party to a proceeding by
reason of its status as (a) the General Partner or (b) a director of the General Partner or an
officer of the Partnership or the General Partner and (ii) such other Persons (including Affiliates
or employees 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.

          “IRS” means the United States Internal Revenue Service.

          “Limited Partner” means any Person that is admitted from time to time to the Partnership as a
limited partner pursuant to the Act and this Agreement and is listed as a limited partner on
Exhibit A attached hereto, as such Exhibit A may be amended from time to time,
including any

11

 

Substituted Limited Partner or Additional Limited Partner, in such Person’s capacity as a
limited partner of 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 Limited 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 Common Units, Partnership Preferred Units or other Partnership Units.

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

          “Liquidating Gains” means any net gain realized in connection with the actual or hypothetical
sale of all or substantially all of the assets of the Partnership (including upon the occurrence of
any Liquidating Event or Terminating Capital Transaction), including but not limited to net gain
realized in connection with an adjustment to the Gross Asset Value of Partnership assets under the
definition of Gross Asset Value in Section 1 of this Agreement.

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

          “LTIP Unit Limited Partner” means any Partner holding LTIP Units.

          “LTIP Units” means the Partnership Units designated as such having the rights, powers,
privileges, restrictions, qualifications and limitations set forth herein and in the Plan. LTIP
Units can be issued in one or more classes, or one or more series of any such classes bearing such
relationship to one another as to allocations, distributions, and other rights as the General
Partner shall determine in its sole and absolute discretion subject to Maryland law.

          “Majority in Interest of the Limited Partners” means Limited Partners (other than any Limited
Partner fifty percent (50%) or more of whose equity is owned, directly or indirectly, by the
General Partner) holding in the aggregate Percentage Interests that are greater than fifty percent
(50%) of the aggregate Percentage Interests of all such Limited Partners entitled to Consent to or
withhold Consent from a proposed action.

          “Majority in Interest of the Partners” means Partners holding in the aggregate Percentage
Interests that are greater than fifty percent (50%) of the aggregate Percentage Interests of all
Partners entitled to Consent to or withhold Consent from a proposed action.

          “Market Price” has the meaning set forth in the definition of “Value.”

          “Maryland Courts” has the meaning set forth in Section 15.9.B hereof.

          “Net Income” or “Net Loss” means, for each Partnership Year or other applicable period, an
amount equal to the Partnership’s taxable income or loss for such year or other applicable period,
determined in accordance with Code Section 703(a) (for this purpose, all items of income, gain,
loss or deduction required to be stated separately pursuant to Code Section 703(a)(1) shall be
included in taxable income or loss), with the following adjustments:

12

 

          (a) Any income of the Partnership that is exempt from federal income tax and not
otherwise taken into account in computing Net Income (or Net Loss) pursuant to this
definition of “Net Income” or “Net Loss” shall be added to (or subtracted from, as the case
may be) such taxable income (or loss);

          (b) Any expenditure of the Partnership described in Code Section 705(a)(2)(B) or
treated as a Code Section 705(a)(2)(B) expenditure pursuant to Regulations Section
1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing Net Income (or Net
Loss) pursuant to this definition of “Net Income” or “Net Loss,” shall be subtracted from
(or added to, as the case may be) such taxable income (or loss);

          (c) In the event the Gross Asset Value of any Partnership asset is adjusted pursuant to
subsection (b) or subsection (c) of the definition of “Gross Asset Value,” the amount of
such adjustment shall be taken into account as gain or loss from the disposition of such
asset for purposes of computing Net Income or Net Loss;

          (d) Gain or loss resulting from any disposition of property with respect to which gain
or loss is recognized for federal income tax purposes shall be computed by reference to the
Gross Asset Value of the property disposed of, notwithstanding that the adjusted tax basis
of such property differs from its Gross Asset Value;

          (e) In lieu of the depreciation, amortization and other cost recovery deductions that
would otherwise be taken into account in computing such taxable income or loss, there shall
be taken into account Depreciation for such Partnership Year or other applicable period;

          (f) To the extent that an adjustment to the adjusted tax basis of any Partnership asset
pursuant to Code Section 734(b) or Code Section 743(b) is required pursuant to Regulations
Section 1.704-1(b)(2)(iv)(m)(4) to be taken into account in determining Capital Accounts as
a result of a distribution other than in liquidation of a Partner’s interest in the
Partnership, the amount of such adjustment shall be treated as an item of gain (if the
adjustment increases the basis of the asset) or loss (if the adjustment decreases the basis
of the asset) from the disposition of the asset and shall be taken into account for purposes
of computing Net Income or Net Loss; and

          (g) Notwithstanding any other provision of this definition of “Net Income” or “Net
Loss,” any item that is specially allocated pursuant to Article 6 hereof shall not be taken
into account in computing Net Income or Net Loss. The amounts of the items of Partnership
income, gain, loss or deduction available to be specially allocated pursuant to Section 6.3
or 6.4 hereof shall be determined by applying rules analogous to those set forth in this
definition of “Net Income” or “Net Loss.”

          “New Securities” means (i) any rights, options, warrants or convertible or exchangeable
securities having the right to subscribe for or purchase REIT Shares or Preferred Shares, excluding
grants under the Stock Option Plans, or (ii) any Debt issued by the General Partner that provides
any of the rights described in clause (i).

13

 

          “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 Sections 1.704-2(b)(3) and
1.752-1(a)(2).

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

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

          “Original Limited Partner” means any Person that is a Limited Partner as of the close of
business on the date of the closing of the issuance of REIT Shares pursuant to the initial public
offering of REIT Shares, and does not include any Assignee or other transferee, including, without
limitation, any Substituted Limited Partner succeeding to all or any part of the Partnership
Interest of any such Person.

          “Ownership Limit” means the restriction or restrictions on the ownership and transfer of stock
of the General Partner imposed under the Charter.

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

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

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

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

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

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

          “Partnership Employee” means an employee or other service provider of the Partnership or of a
Subsidiary of the Partnership, if any, acting in such capacity.

14

 

          “Partnership Equivalent Units” has the meaning set forth in Section 4.7A hereof.“

          “Partnership Interest” means an ownership interest in the Partnership held by either a Limited
Partner or a 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. There may be one or more
classes or series of Partnership Interests. A Partnership Interest may be expressed as a number of
Partnership Common Units, Partnership Preferred Units or other 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 Partnership
Minimum Gain, for a Partnership Year shall be determined in accordance with the rules of
Regulations Section 1.704-2(d).

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

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

          “Partnership Unit” means a Partnership Common Unit, a Partnership Preferred Unit, a LTIP Unit
or any other unit of the fractional, undivided share of the Partnership Interests that the General
Partner has authorized pursuant to Section 4.1, Section 4.2 or Section 4.3 hereof; provided,
however, that Partnership Units comprising a General Partner Interest or a Limited Partner Interest
shall have the differences in rights and privileges as specified in this Agreement.

          “Partnership Unit Designation” shall have the meaning set forth in Section 4.2.A hereof.

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

          “Percentage Interest” means, with respect to each Partner, the fraction, expressed as a
percentage, the numerator of which is the aggregate number of Partnership Units of all classes and
series and the denominator of which is the total number of Partnership Units of all classes and
series held by all Partners; provided, however, that, to the extent applicable in context, the term
“Percentage Interest” means, with respect to a Partner, the fraction, expressed as a percentage,
the numerator of which is the aggregate number of Partnership Units of a specified class or series
(or specified group of classes and/or series) held by such Partner and the denominator of which is
the total number of Partnership Units of such specified class or series (or specified group of
classes and/or series) held by all Partners.

          “Permitted Transfer” has the meaning set forth in Section 11.3.A hereof.

15

 

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

          “Plan” means the Younan Properties, Inc. 2010 Incentive Award Plan.

          “Pledge” has the meaning set forth in Section 11.3.A hereof.

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

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

          “Proposed Section 83 Safe Harbor Regulation” has the meaning set forth in Section 16.11
hereof.

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

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

          “Qualifying Party” means (a) a Limited Partner, (b) an Assignee or (c) a Person, including a
lending institution as the pledgee of a Pledge, who is the transferee of a Limited Partner Interest
in a Permitted Transfer; provided, however, that a Qualifying Party shall not include the General
Partner.

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

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

          “Regulatory Allocations” has the meaning set forth in Section 6.4.A(viii) hereof.

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

16

 

          “REIT Partner” means (a) the General Partner or any Affiliate of the General Partner to the
extent such person has in place an election to qualify as a REIT and, (b) any Disregarded Entity
with respect to any such Person.

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

          “REIT Requirements” has the meaning set forth in Section 5.1 hereof.

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

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

          “Related Party” means, with respect to any Person, any other Person to whom ownership of
shares of the General Partner’s stock by the first such Person would be attributed under Code
Section 544 (as modified by Code Section 856(h)(1)(B)) or Code Section 318(a) (as modified by Code
Section 856(d)(5)).

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

          “Safe Harbors” has the meaning set forth in Section 11.3.C hereof.

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

          “SEC” means the Securities and Exchange Commission.

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

          “Section 83 Safe Harbor” has the meaning set forth in Section 16.11 hereof.

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

          “Specified Redemption Date” means the tenth (10th) Business Day after the receipt by the
General Partner of a Notice of Redemption; provided, however, that no Specified Redemption Date
shall occur during the first Fourteen-Month Period (except pursuant to a Special Redemption).

17

 

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

          “Subsidiary” means, with respect to any Person, any corporation or other entity of which a
majority of (i) the voting power of the voting equity securities or (ii) the outstanding equity
interests is owned, directly or indirectly, by such Person; provided, however, that, with respect
to the Partnership, “Subsidiary” means solely a partnership or limited liability company (taxed,
for federal income tax purposes, as a partnership or as a Disregarded Entity and not as an
association or publicly traded partnership taxable as a corporation) of which the Partnership is a
member or any “taxable REIT subsidiary” of the General Partner in which the Partnership owns shares
of stock, unless the ownership of shares of stock of a corporation or other entity (other than a
“taxable REIT subsidiary”) will not jeopardize the General Partner’s status as a REIT or any
General Partner Affiliate’s status as a “qualified REIT subsidiary” (within the meaning of Code
Section 856(i)(2)), in which event the term “Subsidiary” shall include such corporation or other
entity.

          “Substituted Limited Partner” means a Person who is admitted as a Limited Partner to the
Partnership pursuant to the Act and (i) Section 11.4 hereof or (ii) pursuant to any Partnership
Unit Designation.

          “Surviving Partnership” has the meaning set forth in Section 11.2.B(ii) hereof.

          “Tax Items” has the meaning set forth in Section 6.5.A hereof.

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

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

          “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, in any case, not in the ordinary course of the Partnership’s business.

          “Termination Transaction” has the meaning set forth in Section 11.2.B hereof.

          “Transfer” means any sale, assignment, bequest, conveyance, devise, gift (outright or in
trust), Pledge, encumbrance, hypothecation, mortgage, exchange, transfer or other disposition or
act of alienation, whether voluntary, involuntary or by operation of law; provided, however, that
when the term is used in Article 11 hereof, except as otherwise expressly provided, “Transfer” does
not include (a) any Redemption of Partnership Common Units by the Partnership, or acquisition of
Tendered Units by the General Partner, pursuant to Section 15.1, (b) any conversion of LTIP Units
into Common Units pursuant to Section 16.9 hereof or (c) any redemption of Partnership Units
pursuant to any Partnership Unit Designation. The terms “Transferred” and “Transferring” have
correlative meanings.

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

18

 

          “Value” means, on any Valuation Date with respect to a REIT Share, the average of the daily
Market Prices for ten (10) consecutive trading days immediately preceding the Valuation Date
(except that the Market Price for the trading day immediately preceding the date of exercise of a
stock option under any Stock Option Plans shall be substituted for such average of daily market
prices for purposes of Section 4.4 hereof). The term “Market Price” on any date means, with respect
to any class or series of outstanding REIT Shares, the Closing Price for such REIT Shares on such
date. The “Closing Price” on any date means the last sale price for such REIT Shares, regular way,
or, in case no such sale takes place on such day, the average of the closing bid and asked prices,
regular way, for such REIT Shares, in either case as reported in the principal consolidated
transaction reporting system with respect to securities listed or admitted to trading on the New
York Stock Exchange or, if such REIT Shares are not listed or admitted to trading on the New York
Stock Exchange, as reported on the principal consolidated transaction reporting system with respect
to securities listed on the principal national securities exchange on which such REIT Shares are
listed or admitted to trading or, if such REIT Shares are not listed or admitted to trading on any
national securities exchange, the last quoted price, or, if not so quoted, the average of the high
bid and low asked prices in the over-the-counter market, as reported by the National Association of
Securities Dealers, Inc. Automated Quotation System or, if such system is no longer in use, the
principal other automated quotation system that may then be in use or, if such REIT Shares are not
quoted by any such organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in such REIT Shares selected by the Board of Directors of
the General Partner or, in the event that no trading price is available for such REIT Shares, the
fair market value of the REIT Shares, as determined by the Board of Directors of the General
Partner.

          In the event that 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 on
the basis of such quotations and other information as it considers appropriate.

          “Vesting Date” has the meaning set forth in Section 4.4C.2 hereof.

ARTICLE 2

ORGANIZATIONAL MATTERS

          Section 2.1 Formation. The Partnership is a limited partnership heretofore formed and continued pursuant to the
provisions of the Act and upon the terms and subject to the conditions set forth in this Agreement.
Except as expressly provided herein to the contrary, the rights and obligations of the Partners and
the administration and termination of the Partnership shall be governed by the Act. The Partnership
Interest of each Partner shall be personal property for all purposes.

          Section 2.2 Name. The name of the Partnership is “Younan Properties, L.P.” 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

19

 

the name of the
Partnership at any time and from time to time and shall notify the Partners of such change in the
next regular communication to the Partners.

          Section 2.3 Principal Office and Resident Agent; Principal Executive Office. The address of the principal office of the Partnership in the State of Maryland is located
at c/o The Corporation Trust Incorporated, 351 West Camden Street, Baltimore, Maryland 21201, or
such other place within the State of Maryland as the General Partner may from time to time
designate, and the resident agent of the Partnership in the State of Maryland is The Corporation
Trust Incorporated, 351 West Camden Street, Baltimore, Maryland 21201, or such other resident of
the State of Maryland as the General Partner may from time to time designate. The principal office
of the Partnership is located at 21700 Oxnard Street Suite 800, Woodland Hills, California 91367,
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
State of Maryland as the General Partner deems advisable.

          Section 2.4 Power of Attorney.

A. Each Limited Partner and Assignee hereby irrevocably 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, seal, acknowledge, deliver, file and record in the appropriate public
offices: (a) all certificates, documents and other instruments (including, without limitation,
this Agreement and the Certificate and all amendments, supplements or restatements thereof)
that the General Partner 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 to the extent provided by
applicable law) in the State of Maryland and in all other jurisdictions in which the
Partnership may conduct business or own property; (b) all instruments that the General Partner
or any Liquidator 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 conveyances and other instruments or documents that the General Partner
or the Liquidator deems appropriate or necessary to reflect the distribution or exchange of
assets of the Partnership pursuant to the terms of this Agreement; (e) all instruments
relating to the admission, acceptance, withdrawal, removal or substitution of any Partner
pursuant to the terms of this Agreement or the Capital Contribution of any Partner; and (f)
all certificates, documents and other instruments relating to the determination of the rights,
preferences and privileges relating to Partnership Interests; and

	(2)	 	execute, swear to, acknowledge and file all ballots, consents, approvals, waivers,
certificates and other instruments appropriate or necessary, in the sole and absolute
discretion of the General Partner or any Liquidator, to make, evidence, give, confirm or

20

 

	 	 	ratify any vote, consent, approval, agreement or other action that is made or given by the
Partners hereunder or is consistent with the terms of this Agreement.

Nothing contained herein shall be construed as authorizing the General Partner or any Liquidator to
amend this Agreement except in accordance with Section 14.2 hereof or as may be otherwise expressly
provided for in this Agreement.

B. The foregoing power of attorney is hereby declared to be irrevocable and a special power coupled
with an interest, in recognition of the fact that each of the Limited Partners and Assignees will
be relying upon the power of the General Partner or the Liquidator to act as contemplated by this
Agreement in any filing or other action by it on behalf of the Partnership, and it shall survive
and not be affected by the subsequent Incapacity of any Limited Partner or Assignee and the
Transfer of all or any portion of such Person’s Partnership Interest and shall extend to such
Person’s heirs, successors, assigns and personal representatives. Each such Limited Partner and
Assignee hereby agrees to be bound by any representation made by the General Partner or the
Liquidator, acting in good faith pursuant to such power of attorney; and each such Limited Partner
and Assignee hereby waives any and all defenses that may be available to contest, negate or
disaffirm the action of the General Partner or the Liquidator, taken in good faith under such power
of attorney. Each Limited Partner and Assignee shall execute and deliver to the General Partner or
the Liquidator, within fifteen (15) days after receipt of the General Partner’s or the Liquidator’s
request therefor, such further designation, powers of attorney and other instruments as the General
Partner or the Liquidator (as the case may be) deems necessary to effectuate this Agreement and the
purposes of the Partnership. Notwithstanding anything else set forth in this Section 2.4.B, no
Limited Partner shall incur any personal liability for any action of the General Partner or the
Liquidator taken under such power of attorney.

          Section 2.5 Term. The term of the Partnership commenced on March 26, 2010, the date that the original
Certificate was filed with the SDAT in accordance with the Act, and shall continue indefinitely
unless the Partnership is dissolved sooner pursuant to the provisions of Article 13 hereof or as
otherwise provided by law.

          Section 2.6 Partnership Interests Are Securities. All Partnership Interests shall be securities within the meaning of, and governed by, (i)
Article 8 of the Maryland Uniform Commercial Code and (ii) Article 8 of the Uniform Commercial Code
of any other applicable jurisdiction.

ARTICLE 3

PURPOSE

          Section 3.1 
Purpose and Business. The purpose and nature of the Partnership is to conduct any business, enterprise or
activity permitted by or under the Act, including, without limitation, (i) to conduct the business
of ownership, construction, reconstruction, development, redevelopment, alteration, improvement,
maintenance, operation, sale, leasing, transfer, encumbrance, conveyance and exchange of the
Properties, (ii) to acquire and invest in any securities and/or loans relating to the Properties,
(iii) to enter into any partnership, joint venture, business trust arrangement, limited liability
company or other similar arrangement to engage in

21

 

any business permitted by or under the Act, or to
own interests in any entity engaged in any business permitted by or under the Act, (iv) to conduct
the business of providing property and asset management and brokerage services, whether directly or
through one or more partnerships, joint ventures, Subsidiaries, business trusts, limited liability
companies or similar arrangements, and (v) to do anything necessary or incidental to the foregoing.

          Section 3.2 Powers.

A. The Partnership shall be 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
including, without limitation, full power and authority, directly or through its ownership interest
in other entities, to enter into, perform and carry out contracts of any kind, to borrow and lend
money and to issue evidence of indebtedness, whether or not secured by mortgage, deed of trust,
pledge or other lien, to acquire, own, manage, improve and develop real property and lease, sell,
transfer and dispose of real property.

B. Notwithstanding any other provision in this Agreement, the Partnership shall not take, or
refrain from taking, any action that, 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 taxes under Code Section 857 or
Code Section 4981 or any other related or successor provision under the Code, or (iii) could
violate any law or regulation of any governmental body or agency having jurisdiction over the
General Partner, its securities or the Partnership, unless, in any such case, such action (or
inaction) under clause (i), clause (ii), or clause (iii) above shall have been specifically
Consented to by the General Partner.

          Section 3.3 Partnership Only for Purposes Specified. The Partnership shall be a limited partnership only for the purposes specified in Section
3.1 hereof, and this Agreement shall not be deemed to create a company, venture or partnership
between or among the Partners or any other Persons with respect to any activities whatsoever other
than the activities within the purposes of the Partnership as specified in Section 3.1 hereof.
Except as otherwise provided in this Agreement, no Partner shall have any authority to act for,
bind, commit or assume any obligation or responsibility on behalf of the Partnership, its
properties or any other Partner. No Partner, in its capacity as a Partner under this Agreement,
shall be responsible or liable for any indebtedness or obligation of another Partner, nor shall the
Partnership be responsible or liable for any indebtedness or obligation of any Partner, incurred
either before or after the execution and delivery of this Agreement by such Partner, except as to
those responsibilities, liabilities, indebtedness or obligations incurred pursuant to and as
limited by the terms of this Agreement and the Act.

          Section 3.4 Representations and Warranties by the Partners.

A. Each Partner that is an individual (including, without limitation, each Additional Limited
Partner or Substituted Limited Partner as a condition to becoming an Additional Limited Partner or
a Substituted Limited Partner) represents and warrants to, and covenants with, each other Partner
that (i) the consummation of the transactions contemplated by this Agreement to be

22

 

performed by
such Partner will not result in a breach or violation of, or a default under, any material
agreement by which such Partner or any of such Partner’s property is bound, or any statute,
regulation, order or other law to which such Partner is subject, (ii) if five percent (5%) or more
(by value) of the Partnership’s interests are or will be owned by such Partner within the meaning
of Code Section 7704(d)(3), such Partner does not, and for so long as it is a Partner will not,
own, directly or indirectly, (a) stock of any corporation that is a tenant of (I) the General
Partner or any Disregarded Entity with respect to the General Partner, (II) the Partnership or
(III) any partnership, venture or limited liability company of which the General Partner, any
Disregarded Entity with respect to the General Partner, or the Partnership is a direct or indirect
member or (b) an interest in the assets or net profits of any non-corporate tenant of (I) the
General Partner or any Disregarded Entity with respect to the General Partner, (II) the Partnership
or (III) any partnership, venture, or limited liability company of which the General Partner, any
Disregarded Entity with respect to the General Partner, or the Partnership is a direct or indirect
member, (iii) such Partner has the legal capacity to enter into this Agreement and perform such
Partner’s obligations hereunder, and (iv) this Agreement is binding upon, and enforceable against,
such Partner in accordance with its terms. Notwithstanding the foregoing, a Partner that is an
individual shall not be subject to the ownership restrictions set forth in clause (ii) of the
immediately preceding sentence to the extent such Partner obtains the written Consent of the
General Partner prior to violating any such restrictions. Each Partner that is an individual shall
also represent and warrant to the Partnership that such Partner is neither a “foreign person”
within the meaning of Code Section 1445(f) nor a foreign partner within the meaning of Code Section
1446(e).

B. Each Partner that is not an individual (including, without limitation, each Additional Limited
Partner or Substituted Limited Partner as a condition to becoming an Additional Limited Partner or
a Substituted Limited Partner) represents and warrants to, and covenants with, each other Partner
that (i) all transactions contemplated by this Agreement to be performed by it have been duly
authorized by all necessary action, including, without limitation, that of its general partner(s),
committee(s), trustee(s), beneficiaries, directors and/or stockholder(s) (as the case may be) as
required, (ii) the consummation of such transactions shall not result in a breach or violation of,
or a default under, its partnership or operating agreement, trust agreement, charter or bylaws (as
the case may be) any material agreement by which such Partner or any of such Partner’s properties
or any of its partners, members, beneficiaries, trustees or stockholders (as the case may be) is or
are bound, or any statute, regulation, order or other law to which such Partner or any of its
partners, members, trustees, beneficiaries or stockholders (as the case may be) is or are subject,
(iii) if five percent (5%) or more (by value) of the Partnership’s interests are or will be owned
by such Partner within the meaning of Code Section 7704(d)(3), such Partner does not, and for so
long as it is a Partner will not, own, directly or indirectly, (a) stock of any corporation
that is a tenant of (I) the General Partner or any Disregarded Entity with respect to the General
Partner, (II) the Partnership or (III) any partnership, venture or limited liability company of
which the General Partner, any General Partner, any Disregarded Entity with respect to the General
Partner, or the Partnership is a direct or indirect member or (b) an interest in the assets or net
profits of any non-corporate tenant of (I) the General Partner, or any Disregarded Entity with
respect to the General Partner, (II) the Partnership or (III) any partnership, venture or limited
liability company for which the General Partner, any General Partner, any Disregarded Entity with
respect to the General Partner, or the Partnership is a direct or indirect member, and (iv) this
Agreement is binding upon, and enforceable against, such Partner in accordance with its

23

 

terms.
Notwithstanding the foregoing, a Partner that is not an individual shall not be subject to the
ownership restrictions set forth in clause (iii) of the immediately preceding sentence to the
extent such Partner obtains the written Consent of the General Partner prior to violating any such
restrictions. Each Partner that is not an individual shall also represent and warrant to the
Partnership that such Partner is neither a “foreign person” within the meaning of Code Section
1445(f) nor a foreign partner within the meaning of Code Section 1446(e).

C. Each Partner (including, without limitation, each Additional Limited Partner or Substituted
Limited Partner as a condition to becoming an Additional Limited Partner or Substituted Limited
Partner) represents, warrants and agrees that (i) it has acquired and continues to hold its
interest in the Partnership for its own account for investment purposes only and not for the
purpose of, or with a view toward, the resale or distribution of all or any part thereof in
violation of applicable laws, and not with a view toward selling or otherwise distributing such
interest or any part thereof at any particular time or under any predetermined circumstances in
violation of applicable laws, and (ii) it is a sophisticated investor, able and accustomed to
handling sophisticated financial matters for itself, particularly real estate investments, and that
it has a sufficiently high net worth that it does not anticipate a need for the funds that it has
invested in the Partnership in what it understands to be a highly speculative and illiquid
investment.

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

E. Each Partner (including, without limitation, each Additional Limited Partner or Substituted
Limited Partner as a condition to becoming an Additional Limited Partner or Substituted Limited
Partner) hereby acknowledges that no representations as to potential profit, cash flows, funds from
operations or yield, if any, in respect of the Partnership or the General Partner have been made by
any Partner or any employee or representative or Affiliate of any Partner, and that projections and
any other information, including, without limitation, financial and descriptive information and
documentation, that may have been in any manner submitted to such Partner shall not constitute any
representation or warranty of any kind or nature, express or implied.

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

24

 

ARTICLE 4

CAPITAL CONTRIBUTIONS

          Section 4.1 Capital Contributions of the Partners. The Partners have heretofore made Capital Contributions to the Partnership. Each Partner
owns Partnership Units in the amount set forth for such Partner on Exhibit A, as the same may be
amended from time to time by the General Partner to the extent necessary to reflect accurately
sales, exchanges or other Transfers, redemptions, Capital Contributions, the issuance of additional
Partnership Units, or similar events having an effect on a Partner’s ownership of Partnership
Units. Except as provided by law or in Section 4.2, 4.3, or 10.4 hereof, the Partners shall have no
obligation or, except with the prior Consent of the General Partner, right to make any additional
Capital Contributions or loans to the Partnership.

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

A. General. The General Partner is hereby authorized to cause the Partnership to issue additional
Partnership Interests, in the form of Partnership Units, for any Partnership purpose, at any time
or from time to time, to the Partners (including the General Partner) or to other Persons, and to
admit such Persons as Additional Limited Partners, for such consideration and on such terms and
conditions as shall be established by the General Partner in its sole and absolute discretion, all
without the approval of any Limited Partner or any other Person. Without limiting the foregoing,
the General Partner is expressly authorized to cause the Partnership to issue Partnership Units (i)
upon the conversion, redemption or exchange of any Debt, Partnership Units, or other securities
issued by the Partnership, (ii) for less than fair market value and (iii) in connection with any
merger of any other Person into the Partnership. Any additional Partnership Interests may be issued
in one or more classes, or one or more series of any of such classes, with such designations,
preferences, conversion or other rights, voting powers or rights, restrictions, limitations as to
distributions, qualifications or terms or conditions of redemption (including, without limitation,
terms that may be senior or otherwise entitled to preference over existing Partnership Units) as
shall be determined by the General Partner, in its sole and absolute discretion without the
approval of any Limited Partner or any other Person, and set forth in a written document thereafter
attached to and made an exhibit to this Agreement, which exhibit shall be an amendment to this
Agreement and shall be incorporated herein by this reference (each, a “Partnership Unit
Designation”), without the approval of any Limited Partner or any other Person. Without limiting
the generality of the foregoing, the General Partner shall have authority to specify: (a) the
allocations of items of Partnership income, gain, loss, deduction and credit to each such class or
series of Partnership Interests; (b) the right of each such class or
series of Partnership Interests to share (on a pari passu, junior or preferred basis) in
Partnership distributions; (c) the rights of each such class or series of Partnership Interests
upon dissolution and liquidation of the Partnership; (d) the voting rights, if any, of each such
class or series of Partnership Interests; and (e) the conversion, redemption or exchange rights
applicable to each such class or series of Partnership Interests. Upon the issuance of any
additional Partnership Interest, the General Partner shall amend Exhibit A and the books
and records of the Partnership as appropriate to reflect such issuance.

25

 

B. Issuances of LTIP Units. Without limiting the generality of the foregoing, from time to time,
the General Partner is hereby authorized to issue LTIP Units to Persons providing services to or
for the benefit of the Partnership for such consideration or for no consideration as the General
Partner may determine to be appropriate and on such terms and conditions as shall be established by
the General Partner, and admit such Persons as Limited Partners. Except to the extent a Capital
Contribution is made with respect to an LTIP Unit, each LTIP Unit is intended to qualify as a
profits interests in the Partnership within the meaning of the Code, the Regulations, and any
published guidance by the IRS with respect thereto. Except as may be provided from time to time by
the General Partner with respect to one or more series of LTIP Units, LTIP Units shall be have the
terms set forth in Article 16.

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

D. No Preemptive Rights. Except as specified in Section 4.2.C(i) hereof, no Person, including,
without limitation, any Partner or Assignee, shall have any preemptive, preferential, participation
or similar right or rights to subscribe for or acquire any Partnership Interest.

          Section 4.3 Additional Funds and Capital Contributions.

A. General. The General Partner may, at any time and from time to time, determine that the
Partnership requires additional funds (“Additional Funds”) for the acquisition or development of
additional Properties, for the redemption of Partnership Units or for such other purposes as the
General Partner may determine, in its sole and absolute discretion. Additional Funds may be
obtained by the Partnership, at the election of the General Partner, in any manner provided in, and
in accordance with, the terms of this Section 4.3 without the approval of any Limited Partner or
any other Person.

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

26

 

C. Loans by Third Parties. The General Partner, on behalf of the Partnership, may obtain any
Additional Funds by causing the Partnership to incur Debt to any Person (other than the General
Partner (but, for this purpose, disregarding any Debt that may be deemed incurred to the General
Partner by virtue of clause (iii) of the definition of Debt)) upon such terms as the General
Partner determines appropriate, including making such Debt convertible, redeemable or exchangeable
for Partnership Units or REIT Shares; provided, however, that the Partnership shall not incur any
such Debt if any Partner would be personally liable for the repayment of such Debt (unless such
Partner otherwise agrees).

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

E. Issuance of Securities by the General Partner. The General Partner shall not issue any
additional REIT Shares, Capital Shares or New Securities unless the General Partner contributes the
cash proceeds or other consideration received from the issuance of such additional REIT Shares,
Capital Shares or New Securities (as the case may be) and from the exercise of the rights contained
in any such additional Capital Shares or New Securities to the Partnership in exchange for (x) in
the case of an issuance of REIT Shares, Partnership Common Units, or (y) in the case of an issuance
of Capital Shares or New Securities, Partnership Equivalent Units; provided, however, that
notwithstanding the foregoing, the General Partner may issue REIT Shares, Capital Shares or New
Securities (a) pursuant to Section 4.4 or Section 15.1.B hereof, (b) pursuant to a dividend or
distribution (including any stock split) of REIT Shares, Capital Shares or New Securities to
holders of REIT Shares, Capital Shares or New Securities (as the case may be), (c) upon a
conversion, redemption or exchange of Capital Shares, (d) upon a conversion, redemption, exchange
or exercise of New Securities, or (e) in connection with an acquisition of Partnership Units or a
property or other asset to be owned, directly or indirectly, by the General Partner. In the event
of any issuance of additional REIT Shares, Capital Shares or New Securities by the General Partner,
and the contribution to the Partnership, by the General Partner, of the cash proceeds or other
consideration received from such issuance (or property acquired with such proceeds), if any, if the
cash 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 cash proceeds
of such issuance plus the amount of such underwriter’s discount and other expenses paid by the
General Partner (which discount and expense shall be treated as an expense for the benefit of the
Partnership for purposes of Section 7.4).

27

 

          Section 4.4 Stock Option Plans and Equity Plans.

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

	(1)	 	The General Partner, shall, as soon as practicable after such exercise, make a Capital
Contribution to the Partnership in an amount equal to the exercise price paid to the General
Partner by such exercising party in connection with the exercise of such stock option.
	 
	(2)	 	Notwithstanding the amount of the Capital Contribution actually made pursuant to Section
4.4.A(1) hereof, the General Partner shall be deemed to have contributed to the Partnership as
a Capital Contribution, in lieu of the Capital Contribution actually made and in consideration
of an additional Limited Partner Interest (expressed in and as additional Partnership Common
Units), an amount equal to the Value of a REIT Share as of the date of exercise multiplied by
the number of REIT Shares then being issued in connection with the exercise of such stock
option.

          
     (3) An equitable Percentage Interest adjustment shall be made in which the General Partner
shall be treated as having made a cash contribution equal to the amount described in Section
4.4.A(2) hereof.

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

	(1)	 	The General Partner shall sell to the Optionee, and the Optionee shall purchase from the
General Partner, for a cash price per share equal to the Value of a REIT Share at the time of
the exercise, the number of REIT Shares equal to (a) the exercise price payable by the
Optionee in connection with the exercise of such stock option divided by (b) the Value of a
REIT Share at the time of such exercise.
	 
	(2)	 	The General Partner shall sell to the Partnership (or if the Optionee is an employee or other
service provider of a Partnership Subsidiary, the General Partner shall sell to such
Partnership Subsidiary), and the Partnership (or such subsidiary, as applicable) shall
purchase from the General Partner, a number of REIT Shares equal to (a) the number of REIT
Shares as to which such stock option is being exercised less (b) the number of REIT Shares
sold pursuant to Section 4.4.B(1) hereof. The purchase price per REIT Share for such sale of
REIT Shares to the Partnership (or such subsidiary) shall be the Value of a REIT Share as of
the date of exercise of such stock option.
	 
	(3)	 	The Partnership shall transfer to the Optionee (or if the Optionee is an employee or other
service provider of a Partnership Subsidiary, the Partnership Subsidiary shall transfer to the
Optionee) at no additional cost, as additional compensation, the number of REIT Shares
described in Section 4.4.B(2) hereof.

28

 

	(4)	 	The General Partner shall, as soon as practicable after such exercise, make a Capital
Contribution to the Partnership of an amount equal to all proceeds received (from whatever
source, but excluding any payment in respect of payroll taxes or other withholdings) by the
General Partner in connection with the exercise of such stock option. An equitable Percentage
Interest adjustment shall be made as a result of such contribution.

C. Restricted Stock Granted to Persons other than Partnership Employees. If at any time or from
time to time, in connection with any Equity Plan (other than a Stock Option Plan), any REIT Shares
are issued to a Person other than a Partnership Employee in consideration for services performed
for the General Partner:

	(1)	 	The General Partner shall issue such number of REIT Shares as are to be issued to such Person
in accordance with the Equity Plan; and
	 
	(2)	 	On the date (such date, the “Vesting Date”) that the Value of such shares is includible in
taxable income of such Person, the following events will be deemed to have occurred: (a) the
General Partner shall be deemed to have contributed the Value of such REIT Shares to the
Partnership as a Capital Contribution, and (b) the Partnership shall issue to the General
Partner on the Vesting Date a number of Common Units equal to the number of newly issued REIT
Shares divided by the Adjustment Factor then in effect.

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

	(1)	 	The General Partner shall issue such number of REIT Shares as are to be issued to the
Partnership Employee in accordance with the Equity Plan;
	 
	(2)	 	On the Vesting Date the following events will be deemed to have occurred: (a) the General
Partner shall be deemed to have sold such shares to the Partnership (or if the Partnership
Employee is an employee or other service provider of a Partnership Subsidiary, to such
Partnership Subsidiary) for a purchase price equal to the Value of such shares, (b) the
Partnership (or such Partnership Subsidiary) shall be deemed to have delivered the shares to
the Partnership Employee, (c) the General Partner shall be deemed to have contributed the
purchase price to the Partnership as a Capital Contribution, and (d) in the case where the
Partnership Employee is an employee of a Partnership Subsidiary, the Partnership shall be
deemed to have contributed such amount to the capital of the Partnership Subsidiary; and
	 
	(3)	 	The Partnership shall issue to the General Partner on the Vesting Date a number of Common
Units equal to the number of newly issued REIT Shares divided by the Adjustment Factor then in
effect in consideration for the Capital Contribution described in (2)(c) above.

29

 

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

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

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

          Section 4.7 Conversion or Redemption of Capital Shares.

A. Conversion of Capital Shares. If, at any time, any of the Capital Shares are converted into REIT
Shares, in whole or in part, then a number of Partnership Units with preferences, conversion and
other rights, voting powers, restrictions, limitations as to dividends and other distributions,
qualifications and terms and conditions of redemption that are substantially the same as the
preferences, conversion and other rights, voting powers, restrictions, limitations as to
distributions, qualifications and terms and conditions of redemption of such Capital Shares
(“Partnership Equivalent Units”) equal to the number of Capital Shares so converted shall
automatically be converted into a number of Partnership Common Units equal to the quotient of (i)
the number of REIT Shares issued upon such conversion divided by (ii) the Adjustment Factor then in
effect, and the Percentage Interests of the General Partner and the Limited Partners shall be
adjusted to reflect such conversion.

B. Redemption of Capital Shares or REIT Shares. Except as otherwise provided in Section 7.4.C.,
if, at any time, any Capital Shares are redeemed (whether by exercise of a put or call,
automatically or by means of another arrangement) by the General Partner for cash, the Partnership
shall, immediately prior to such redemption of Capital Shares, redeem an equal number of
Partnership Equivalent Units held by the General Partner upon the same terms and for the same price
per Partnership Equivalent Unit as such Capital Shares are redeemed. If, at any time, any REIT
Shares are redeemed or otherwise repurchased by the General Partner for cash pursuant to Article VI
of the Charter, the Partnership shall, immediately prior to such redemption of REIT Shares, redeem
a number of Partnership Common Units held by the General Partner

30

 

equal to the quotient of (i) the
REIT Shares so redeemed or repurchased, divided by (ii) the Adjustment Factor then in effect, such
redemption or repurchase to be upon the same terms and for the same price per Partnership Common
Unit (after giving effect to application of the Adjustment Factor) as such REIT Shares are redeemed
or repurchased.

          Section 4.8 Other Contribution Provisions. In the event that any Partner is admitted to the Partnership and is given a Capital Account
in exchange for services rendered to the Partnership, such transaction shall be treated by the
Partnership and the affected Partner as if the Partnership had compensated such partner in cash and
such Partner had contributed the cash that the Partner would have received to the capital of the
Partnership. In addition, with the Consent of the General Partner, one or more Partners may enter
into contribution agreements with the Partnership which have the effect of providing a guarantee of
certain obligations of the Partnership (and/or a wholly-owned Subsidiary of the Partnership).

ARTICLE 5

DISTRIBUTIONS

          Section 5.1 Requirement and Characterization of Distributions. Subject to the rights of any Holder of any Partnership Interest set forth in a Partnership
Unit Designation, the General Partner may cause the Partnership to distribute quarterly all, or
such portion as the General Partner may, in its sole and absolute discretion, determine, of the
Available Cash generated by the Partnership during such quarter to the Holders on the Partnership
Record Date with respect to such quarter: (i) first, with respect to any Partnership Units that are
entitled to any preference in distribution, in accordance with the rights of Holders of such
class(es) of Partnership Units (and, within each such class, among the Holders of each such class,
pro rata in proportion to their respective Percentage Interests of such class on such Partnership
Record Date); and (ii) second, with respect to any Partnership Units that are not entitled to any
preference in distribution, in accordance with the rights of Holders of such class(es) of
Partnership Units, as applicable (and, within each such class, among the Holders of each such
class, pro rata in proportion to their respective Percentage Interests of such class on such
Partnership Record Date). Distributions payable with respect to any Partnership Units, other than
any Partnership Units issued to the General Partner in connection with the issuance of REIT Shares
by the General Partner, that were not outstanding during the entire quarterly period in respect of
which any distribution is made shall be prorated based on the portion of the period that such
Partnership Units were outstanding. Notwithstanding the foregoing, the General Partner, in its sole
and absolute discretion, may cause the Partnership to distribute Available Cash to the Holders on a
more or less frequent basis than quarterly and provide for an appropriate record
date. The General Partner shall make such reasonable efforts, as determined by it in its sole
and absolute discretion and consistent with the General Partner’s qualification as a REIT, to cause
the Partnership to distribute sufficient amounts to enable the General Partner, for so long as the
General Partner has determined to qualify as a REIT, to pay stockholder dividends that will (a)
satisfy the requirements for qualifying as a REIT under the Code and Regulations (the “REIT
Requirements”) and (b) except to the extent otherwise determined by the General Partner, eliminate
any U.S. federal income or excise tax liability of the General Partner. Notwithstanding anything in
the forgoing to the contrary, a Holder of LTIP Units will only be entitled to distributions with
respect to an LTIP Unit as set forth in Article 16 hereof and in making

31

 

distributions pursuant to
this Section 5.1, the General Partner of the Partnership shall take into account the provisions of
Section 16.4 hereof.

          Section 5.2 Distributions in Kind. Except as expressly provided herein, no right is given to any Holder to demand and receive
property other than cash as provided in this Agreement. The General Partner may determine, in its
sole and absolute discretion, to make a distribution in kind of Partnership assets to the Holders,
and such assets shall be distributed in such a fashion as to ensure that the fair market value is
distributed and allocated in accordance with Articles 5, 6 and 13 hereof; provided, however, that
the General Partner shall not make a distribution in kind to any Holder unless the Holder has been
given 90 days prior written notice of such distribution.

          Section 5.3 Amounts Withheld. All amounts withheld pursuant to the Code or any provisions of any state, local or
non-United States tax law and Section 10.4 hereof with respect to any allocation, payment or
distribution to any Holder shall be treated as amounts paid or distributed to such Holder pursuant
to Section 5.1 hereof for all purposes under this Agreement.

          Section 5.4 Distributions upon Liquidation. Notwithstanding the other provisions of this Article 5, net proceeds from a Terminating
Capital Transaction, and any other amounts distributed after the occurrence of a Liquidating Event,
shall be distributed to the Holders in accordance with Section 13.2 hereof.

          Section 5.5 Distributions to Reflect Additional Partnership Units. In the event that the Partnership issues additional Partnership Units pursuant to the
provisions of Article 4 hereof, subject to the rights of any Holder of any Partnership Interest set
forth in a Partnership Unit Designation, the General Partner is hereby authorized to make such
revisions to this Article 5 and to Articles 6, 11 and 12 hereof as it determines are necessary or
desirable to reflect the issuance of such additional Partnership Units, including, without
limitation, making preferential distributions to Holders of certain classes of Partnership Units.

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

ARTICLE 6

ALLOCATIONS

          Section 6.1 Timing and Amount of Allocations of Net Income and Net Loss. Net Income and Net Loss of the Partnership shall be determined and allocated with respect
to each Partnership Year as of the end of each such year, provided that the General Partner may in
its discretion allocate Net Income and Net Loss for a shorter period as of the end of such period
(and, for purposes of this Article 6, references to the term “Partnership Year” may include such
shorter periods). Except as otherwise provided in this Article 6, and subject to Section 11.6.C
hereof, an allocation to a Holder of a share of Net Income or Net Loss shall be treated as an
allocation of the same share of each item of income, gain, loss or deduction that is taken into
account in computing Net Income or Net Loss.

32

 

          Section 6.2 General Allocations. Except as otherwise provided in this Article 6 and Section 11.6.C hereof, Net Income and
Net Loss for any Partnership Year shall be allocated to each of the Holders as follows:

A. Net Income.

          (i) First, 100% to the General Partner in an amount equal to the remainder, if any, of
the cumulative Net Losses allocated to the General Partner pursuant to clause (iii) in
Section 6.2.B for all prior Partnership Years minus the cumulative Net Income allocated to
the General Partner pursuant to this clause (i) for all prior Partnership Years;

          (ii) Second, 100% to each Holder in an amount equal to the remainder, if any, of the
cumulative Net Losses allocated to each such Holder pursuant to clause (ii) in Section 6.2.B
for all prior Partnership Years minus the cumulative Net Income allocated to such Holder
pursuant to this clause (ii) for all prior Partnership Years; and

          (iii) Third, 100% to the Holders of Partnership Common Units in accordance with their
respective Percentage Interests in the Partnership Common Units.

To the extent the allocations of Net Income set forth above in any paragraph of this Section 6.2.A
are not sufficient to entirely satisfy the allocation set forth in such paragraph, such allocation
shall be made in proportion to the total amount that would have been allocated pursuant to such
paragraph without regard to such shortfall.

B. Net Losses.

          (i) First, 100% to the Holders of Partnership Common Units in accordance with their
respective Percentage Interests in the Partnership Common Units (to the extent consistent
with this clause (i)) until the Adjusted Capital Account (ignoring for this
purpose any amounts a Holder is obligated to contribute to the capital of the
Partnership or is deemed obligated to restore pursuant to Regulations Section
1.704-1(b)(2)(ii)(c)(2)) of all such Holders is zero;

          (ii) Second, 100% to the Holders (other than the General Partner) to the extent of, and
in proportion to, the positive balance (if any) in their Adjusted Capital Accounts; and

          (iii) Third, 100% to the General Partner.

C. Allocations to Reflect Issuance of Additional Partnership Interests. In the event that the
Partnership issues additional Partnership Interests to the General Partner or any Additional
Limited Partner pursuant to Section 4.2 or 4.3, the General Partner shall make such revisions to
this Section 6.2 or to Section 12.2.C or 13.2.A as it determines are necessary to reflect the terms
of the issuance of such additional Partnership Interests, including making preferential allocations
to certain classes of Partnership Interests, subject to the terms of any Partnership Unit
Designation with respect to Partnership Interests then outstanding.

33

 

D. Special Allocations with Respect to LTIP Units. In the event that Liquidating Gains are
allocated under this Section 6.2.D, Net Income allocable under Section 6.2.A and any Net Losses
allocable under Section 6.2.B shall be recomputed without regard to the Liquidating Gains so
allocated. After giving effect to the special allocations set forth in Section 6.4.A hereof, and
notwithstanding the provisions of Sections 6.2.A and 6.2.B above, any Liquidating Gains shall first
be allocated to the Holders of LTIP Units until the Economic Capital Account Balances of such
Holders, to the extent attributable to their ownership of LTIP Units, are equal to (i) the Common
Unit Economic Balance, multiplied by (ii) the number of their LTIP Units. Any such allocations
shall be made among the Holders of LTIP Units in proportion to the amounts required to be allocated
to each under this Section 6.2.D. The parties agree that the intent of this Section 6.2.D is to
make the Capital Account balances of the Holders of LTIP Units with respect to their LTIP Units
economically equivalent to the Capital Account balance of the General Partner with respect to its
Partnership Common Units.

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

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

B. Offsetting Allocations. Notwithstanding the provisions of Sections 6.1, 6.2.B and 6.2.C, but
subject to Sections 6.3 and 6.4, in the event Net Income or items thereof are being allocated to a
Partner to offset prior Net Loss or items thereof which have been allocated to such Partner, the
General Partner shall attempt to allocate such offsetting Net Income or items thereof which are of
the same or similar character (including without limitation Section 704(b) book items versus tax
items) to the original allocations with respect to such Partner

C. CODI Allocations. Notwithstanding anything to the contrary contained herein, if any indebtedness
of the Partnership encumbering the Properties contributed to the Partnership in connection with the
General Partner’s initial public offering is settled or paid off at a discount, any resulting COD
Income of the Partnership shall be specially allocated proportionately (as determined by the
General Partner) to those Holders that were partners in entities that contributed, or were deemed
to contribute, the applicable Property to the Partnership in connection with such initial public
offering to the extent the number of Partnership Units received by such Holders in exchange for
their interests in such entities was determined, in part, by taking into account the anticipated
discounted settlement or pay-off of such indebtedness. For

34

 

purposes of the foregoing, “COD Income”
shall mean income recognized by the Partnership pursuant to Code Section 61(a)(12).

          Section 6.4 Regulatory Allocation Provisions. Notwithstanding the foregoing provisions of this Article 6:

A. Regulatory Allocations.

          (i) Minimum Gain Chargeback. Except as otherwise provided in Regulations Section
1.704-2(f), notwithstanding the provisions of Section 6.2 hereof, or any other provision of
this Article 6, if there is a net decrease in Partnership Minimum Gain during any
Partnership Year, each Holder shall be specially allocated items of Partnership income and
gain for such year (and, if necessary, subsequent years) in an amount equal to such Holder’s
share of the net decrease in Partnership Minimum Gain, as determined under Regulations
Section 1.704-2(g). Allocations pursuant to the previous sentence shall be made in
proportion to the respective amounts required to be allocated to each Holder pursuant
thereto. The items to be allocated shall be determined in accordance with Regulations
Sections 1.704-2(f)(6) and 1.704-2(j)(2). This Section 6.4.A(i) is intended to qualify as a
“minimum gain chargeback” within the meaning of Regulations Section 1.704-2(f) and shall be
interpreted consistently therewith.

          (ii) Partner Minimum Gain Chargeback. Except as otherwise provided in Regulations
Section 1.704-2(i)(4) or in Section 6.4.A(i) hereof, if there is a net decrease in Partner
Minimum Gain attributable to a Partner Nonrecourse Debt during any Partnership Year, each
Holder who has a share of the Partner Minimum Gain attributable to such Partner Nonrecourse
Debt, determined in accordance with Regulations Section 1.704-2(i)(5), shall be specially
allocated items of Partnership income and gain for such year (and, if necessary, subsequent years) in an amount equal to such Holder’s share of
the net decrease in Partner Minimum Gain attributable to such Partner Nonrecourse Debt,
determined in accordance with Regulations Section 1.704-2(i)(4). Allocations pursuant to the
previous sentence shall be made in proportion to the respective amounts required to be
allocated to each Holder pursuant thereto. The items to be so allocated shall be determined
in accordance with Regulations Sections 1.704-2(i)(4) and 1.704-2(j)(2). This Section
6.4.A(ii) is intended to qualify as a “chargeback of partner nonrecourse debt minimum gain”
within the meaning of Regulations Section 1.704-2(i) and shall be interpreted consistently
therewith.

          (iii) Nonrecourse Deductions and Partner Nonrecourse Deductions. Any Nonrecourse
Deductions for any Partnership Year shall be specially allocated to the Holders in
accordance with their respective Percentage Interests. Any Partner Nonrecourse Deductions
for any Partnership Year shall be specially allocated to the Holder(s) who bears the
economic risk of loss with respect to the Partner Nonrecourse Debt to which such Partner
Nonrecourse Deductions are attributable, in accordance with Regulations Section 1.704-2(i).

          (iv) Qualified Income Offset. If any Holder unexpectedly receives an adjustment,
allocation or distribution described in Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) or
(6), items of Partnership income and gain shall be specially allocated, in accordance with
Regulations Section 1.704-

35

 

1(b)(2)(ii)(d), to such Holder in an amount and manner sufficient
to eliminate, to the extent required by such Regulations, the Adjusted Capital Account
Deficit of such Holder as quickly as possible, provided that an allocation pursuant to this
Section 6.4.A(iv) shall be made if and only to the extent that such Holder would have an
Adjusted Capital Account Deficit after all other allocations provided in this Article 6 have
been tentatively made as if this Section 6.4.A(iv) were not in the Agreement. It is intended
that this Section 6.4.A(iv) qualify and be construed as a “qualified income offset” within
the meaning of Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted
consistently therewith.

          (v) Gross Income Allocation. In the event that any Holder has a deficit Capital
Account at the end of any Partnership Year that is in excess of the sum of (1) the amount
(if any) that such Holder is obligated to restore to the Partnership upon complete
liquidation of such Holder’s Partnership Interest (including, the Holder’s interest in
outstanding Partnership Preferred Units and other Partnership Units) and (2) the amount that
such Holder is deemed to be obligated to restore pursuant to Regulations Section
1.704-1(b)(2)(ii)(c) or the penultimate sentences of Regulations Sections 1.704-2(g)(1) and
1.704-2(i)(5), each such Holder shall be specially allocated items of Partnership income and
gain in the amount of such excess to eliminate such deficit as quickly as possible, provided
that an allocation pursuant to this Section 6.4.A(v) shall be made if and only to the extent
that such Holder would have a deficit Capital Account in excess of such sum after all other
allocations provided in this Article 6 have been tentatively made as if this Section
6.4.A(v) and Section 6.4.A(iv) hereof were not in the Agreement.

          (vi) Limitation on Allocation of Net Loss. To the extent that any allocation of Net
Loss would cause or increase an Adjusted Capital Account Deficit as to any Holder, such allocation of Net Loss shall be reallocated (x) first, among the other Holders of
Partnership Common Units in accordance with their respective Percentage Interests with
respect to Partnership Common Units and (y) thereafter, among the Holders of other classes
of Partnership Units as determined by the General Partner, subject to the limitations of
this Section 6.4.A(vi).

          (vii) Section 754 Adjustment. To the extent that an adjustment to the adjusted tax
basis of any Partnership asset pursuant to Code Section 734(b) or Code Section 743(b) is
required, pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(2) or Regulations Section
1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital Accounts as the
result of a distribution to a Holder in complete liquidation of its interest in the
Partnership, the amount of such adjustment to the Capital Accounts shall be treated as an
item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment
decreases such basis), and such gain or loss shall be specially allocated to the Holders in
accordance with their respective Percentage Interests in the event that Regulations Section
1.704-1(b)(2)(iv)(m)(2) applies, or to the Holder(s) to whom such distribution was made in
the event that Regulations Section 1.704-1(b)(2)(iv)(m)(4) applies.

36

 

          (viii) Curative Allocations. The allocations set forth in Sections 6.4.A(i), (ii),
(iii), (iv), (v), (vi) and (vii) hereof (the “Regulatory Allocations”) are intended to
comply with certain regulatory requirements, including the requirements of Regulations
Sections 1.704-1(b) and 1.704-2. Notwithstanding the provisions of Sections 6.1 and 6.2
hereof, the Regulatory Allocations shall be taken into account in allocating other items of
income, gain, loss and deduction among the Holders so that to the extent possible without
violating the requirements giving rise to the Regulatory Allocations, the net amount of such
allocations of other items and the Regulatory Allocations to each Holder shall be equal to
the net amount that would have been allocated to each such Holder if the Regulatory
Allocations had not occurred.

          (ix) Forfeiture Allocations. Upon a forfeiture of any Unvested LTIP Units by any
Partner, gross items of income, gain, loss or deduction shall be allocated to such Partner
if and to the extent required by final Regulations promulgated after the Effective Date to
ensure that allocations made with respect to all unvested Partnership Interests are
recognized under Code Section 704(b).

          (x) LTIP Units. For purposes of the allocations set forth in this Section 6.4.A,
including, without limitation, Sections 6.4.A(iii) and (vi), each issued and outstanding
LTIP Unit will be treated as one outstanding Partnership Common Unit.

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

          Section 6.5 Tax Allocations.

A. In General. Except as otherwise provided in this Section 6.5, for income tax purposes under the
Code and the Regulations, each Partnership item of income, gain, loss and deduction (collectively,
“Tax Items”) shall be allocated among the Holders in the same manner as its correlative item of
“book” income, gain, loss or deduction is allocated pursuant to Sections 6.2 and 6.3 hereof.

B. Section 704(c) Allocations. Notwithstanding Section 6.5.A hereof, Tax Items with respect to
Property that is contributed to the Partnership with an initial Gross Asset Value that varies from
its basis in the hands of the contributing Partner immediately preceding the date of contribution
shall be allocated among the Holders for income tax purposes pursuant to Regulations promulgated
under Code Section 704(c) so as to take into account such variation. With respect to Partnership
Property that is contributed to the Partnership in connection with the General Partner’s initial
public offering, such variation between basis and initial Gross Asset Value shall be taken into
account under the “traditional method” as described in Regulations Section 1.704-3(b). With
respect to other Properties, the Partnership shall account for such variation under any method
approved under Code Section 704(c) and the applicable Regulations as chosen by the General Partner.
In the event that the Gross Asset Value of any Partnership asset is adjusted pursuant to subsection
(b) of the definition of “Gross Asset Value” (provided in

37

 

Article 1 hereof), subsequent allocations
of Tax Items with respect to such asset shall take account of the variation, if any, between the
adjusted basis of such asset and its Gross Asset Value in the same manner as under Code Section
704(c) and the applicable Regulations and using the method chosen by the General Partner; provided,
however, that the “traditional method” as described in Regulations Section 1.704-3(b) shall be used
with respect to Partnership Property that is contributed to the Partnership in connection with the
General Partner’s initial public offering. Allocations pursuant to this Section 6.5.B are solely
for purposes of Federal, state and local income taxes and shall not affect, or in any way be taken
into account in computing, any Partner’s Capital Account or share of Net Income, Net Loss, or any
other items or distributions pursuant to any provision of this Agreement.

ARTICLE 7

MANAGEMENT AND OPERATIONS OF BUSINESS

          Section 7.1 Management.

A. Except as otherwise expressly provided in this Agreement, including any Partnership Unit
Designation, all management powers over the business and affairs of the Partnership are and shall
be exclusively vested in the General Partner, and no Limited Partner shall have any right to
participate in or exercise control or management power over the business and affairs of the
Partnership. No General Partner may be removed by the Partners, with or without cause, except with
the Consent of the General Partner. In addition to the powers now or hereafter granted a general
partner of a limited partnership under applicable law or that are granted to the General Partner
under any other provision of this Agreement, the General Partner, subject to the other provisions
hereof including, without limitation, Section 3.2 and Section 7.3, and the rights of any Holder of
any Partnership Interest set forth in a Partnership Unit Designation, shall have full and exclusive
power and authority, without the consent or approval of any Limited Partner,
to do all things deemed necessary or desirable by it to conduct the business and affairs of the
Partnership, to exercise or direct the exercise of all of the powers of the Partnership under the
Act and this Agreement and to effectuate the purposes of the Partnership including, without
limitation:

	 	(1)	 	the making of any expenditures, the lending or borrowing of money or selling of assets
(including, without limitation, making prepayments on loans and borrowing money to permit the
Partnership to make distributions to the Holders in such amounts as will permit the General
Partner to prevent the imposition of any federal income tax on the General Partner (including,
for this purpose, any excise tax pursuant to Code Section 4981), to make distributions to its
stockholders and payments to any taxing authority sufficient to permit the General Partner to
maintain REIT status or otherwise to satisfy the REIT Requirements), 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 that the General Partner deems necessary for the conduct of the activities of
the Partnership;

38

 

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

	 	(4)	 	subject to Section 11.2 hereof, the acquisition, sale, transfer, exchange or other
disposition of any, all or substantially all of the assets (including the goodwill) of the
Partnership (including, but not limited to, the exercise or grant of any conversion, option,
privilege or subscription right or any other right available in connection with any assets at
any time held by the Partnership) or the merger, consolidation, reorganization or other
combination of the Partnership with or into another entity;
	 
	 	(5)	 	the mortgage, pledge, encumbrance or hypothecation of any assets of the Partnership, the
assignment of any assets of the Partnership in trust for creditors or on the promise of the
assignee to pay the debts of the Partnership, 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 that the General Partner sees fit, including, without
limitation, the financing of the operations and activities of the General Partner, the
Partnership or any of the Partnership’s Subsidiaries, the lending of funds to other Persons
(including, without limitation, the General Partner and/or the Partnership’s Subsidiaries) and
the repayment of obligations of the Partnership, its Subsidiaries and any other Person in
which the Partnership has an equity investment, and the making of capital contributions to and
equity investments in the Partnership’s Subsidiaries;

	 	(6)	 	the management, operation, leasing, landscaping, repair, alteration, demolition, replacement
or improvement of any Property;
	 
	 	(7)	 	the negotiation, execution and performance of any contracts, including leases (including
ground leases), easements, management agreements, rights of way and other property-related
agreements, 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, governmental authorities, accountants, legal counsel, other professional advisors
and other agents and the payment of their expenses and compensation, as applicable, out of the
Partnership’s assets;
	 
	 	(8)	 	the distribution of Partnership cash or other Partnership assets in accordance with this
Agreement, the holding, management, investment and reinvestment of cash and other assets of
the Partnership, and the collection and receipt of revenues, rents and income of the
Partnership;
	 
	 	(9)	 	the selection and dismissal of employees of the Partnership (if any) or the General Partner
(including, without limitation, employees having titles or offices such as “president,” “vice
president,” “secretary” and “treasurer”), and agents, outside attorneys, accountants,

39

 

	 	 	 	consultants and contractors of the Partnership or the General Partner and the determination of
their compensation and other terms of employment or hiring;

	 	(10)	 	the maintenance of such insurance (including, without limitation, directors and officers
insurance) for the benefit of the Partnership and the Partners (including, without limitation,
the General Partner) as the General Partner deems necessary or appropriate;
	 
	 	(11)	 	the formation of, or acquisition of an interest in, and the contribution of property to, any
further limited or general partnerships, limited liability companies, joint ventures or other
relationships that it deems desirable (including, without limitation, the acquisition of
interests in, and the contributions of property to, any Subsidiary and any other Person in
which the General Partner has an equity investment from time to time); provided, however,
that, as long as the General Partner has determined to continue to qualify as a REIT, the
Partnership will not engage in any such formation, acquisition or contribution that would
cause the General Partner to fail to qualify as a REIT;
	 
	 	(12)	 	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, arbitrations 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;
	 
	 	(13)	 	the undertaking of any action in connection with the Partnership’s direct or indirect
investment in any Subsidiary or any other Person (including, without limitation, the
contribution or loan of funds by the Partnership to such Persons);
	 
	 	(14)	 	the determination of the fair market value of any Partnership property distributed in kind
using such reasonable method of valuation as the General Partner may adopt; provided, however,
that such methods are otherwise consistent with the requirements of this Agreement;
	 
	 	(15)	 	the enforcement of any rights against any Partner pursuant to representations, warranties,
covenants and indemnities relating to such Partner’s contribution of property or assets to the
Partnership;
	 
	 	(16)	 	the exercise, directly or indirectly, through any attorney-in-fact acting under a general or
limited power of attorney, of 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;

40

 

	 	(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;
	 
	 	(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, confessions of judgment or any other 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;
	 
	 	(20)	 	the issuance of additional Partnership Units in connection with Capital Contributions by
Additional Limited Partners and additional Capital Contributions by Partners pursuant to
Article 4 hereof;
	 
	 	(21)	 	an election to dissolve the Partnership pursuant to Section 13.1.B hereof;
	 
	 	(22)	 	the distribution of cash to acquire Partnership Common Units held by a Limited Partner in
connection with a Redemption under Section 15.1 hereof;
	 
	 	(23)	 	an election to acquire Tendered Units in exchange for REIT Shares;
	 
	 	(24)	 	the amendment and restatement of Exhibit A hereto to reflect accurately at all times
the Capital Contributions and Percentage Interests of the Partners as the same are adjusted
from time to time to the extent necessary to reflect redemptions, Capital Contributions, the
issuance of Partnership Units, the admission of any Additional Limited Partner or any
Substituted Limited Partner or otherwise, which amendment and restatement, notwithstanding
anything in this Agreement to the contrary, shall not be deemed an amendment to this
Agreement, as long as the matter or event being reflected in Exhibit A hereto
otherwise is authorized by this Agreement; and
	 
	 	(25)	 	the registration of any class of securities of the Partnership under the Securities Act or
the Exchange Act, and the listing of any debt securities of the Partnership on any exchange.

B. Each of the Limited Partners agrees that, except as provided in Section 7.3 hereof and subject
to the rights of any Holder of any Partnership Interest set forth in a Partnership Unit
Designation, the General Partner is authorized to execute, deliver and perform the above-mentioned
agreements and transactions on behalf of the Partnership without any further act, approval or vote
of the Partners or any other Persons, notwithstanding any other provision of the Act or any
applicable law, rule or regulation.

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 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 working capital and other reserves in such amounts as the General Partner,
in its sole and absolute discretion, deems appropriate and reasonable from time to time.

41

 

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 (or not
taken) by it. The General Partner and the Partnership shall not have liability to a Limited Partner
under any circumstances as a result of any income tax liability incurred by such Limited Partner as
a result of an action (or inaction) by the General Partner pursuant to its authority under this
Agreement.

          Section 7.2 Certificate of Limited Partnership. To the extent that such action is determined by the General Partner to be reasonable and
necessary or appropriate, the General Partner shall file amendments to and restatements of the
Certificate and do all the things to maintain the Partnership as a limited partnership (or a
partnership in which the limited partners have limited liability) under the laws of the State of
Maryland and each other state, the District of Columbia or any other jurisdiction, in which the
Partnership may elect to do business or own property. Subject to the terms of Section 8.5.A hereof,
the General Partner shall not be required, before or after filing, to deliver or mail a copy of the
Certificate or any amendment thereto to any Limited Partner. The General Partner shall use all
reasonable efforts to cause to be filed such other certificates or documents as may be reasonable
and necessary or appropriate for the formation, continuation, qualification and operation of a
limited partnership (or a partnership in which the limited partners have limited liability to the
extent provided by applicable law) in the State of Maryland and any other state, or the District of
Columbia or other jurisdiction, in which the Partnership may elect to do business or own property.

          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 Consent of the Limited Partners, and may not, without
limitation:

	 	(1)	 	take any action that would make it impossible to carry on the ordinary business of the
Partnership, except as otherwise provided in this Agreement;
	 
	 	(2)	 	perform any act that would subject a Limited Partner to liability as a general partner in any
jurisdiction or any other liability except as provided herein or under the Act; or
	 
	 	(3)	 	enter into any contract, mortgage, loan or other agreement that expressly prohibits or
restricts (a) the General Partner or the Partnership from performing its specific obligations
under Section 15.1 hereof in full or (b) a Limited Partner from exercising its rights under
Section 15.1 hereof to effect a Redemption in full, except, in either case, with the Consent
of each Limited Partner affected by the prohibition or restriction.

B. Except as provided in Section 7.3.C hereof, the General Partner shall not, without the prior
Consent of the Partners, amend, modify or terminate this Agreement.

C. Notwithstanding Section 7.3.B and 14.2 hereof but subject to the rights of any Holder of any
Partnership Interest set forth in a Partnership Unit Designation, the General Partner shall have
the power, without the Consent of the Partners, to amend this Agreement as may be required to
facilitate or implement any of the following purposes:

42

 

	 	(1)	 	to add to the obligations of the General Partner or surrender any right or power granted to
the General Partner or any Affiliate of the General Partner for the benefit of the Limited
Partners;
	 
	 	(2)	 	to reflect the admission, substitution or withdrawal of Partners, the Transfer of any
Partnership Interest, the termination of the Partnership in accordance with this Agreement, or
the adjustment of outstanding LTIP Units as contemplated by Section 16.3, and to amend
Exhibit A in connection with such admission, substitution, withdrawal, Transfer or
adjustment;
	 
	 	(3)	 	to reflect a change that is of an inconsequential nature or does not adversely affect the
Limited Partners in any material respect, or to cure any ambiguity, correct or supplement any
provision in this Agreement not inconsistent with law or with other provisions, or make other
changes with respect to matters arising under this Agreement that will not be inconsistent
with law or with the provisions of this Agreement;
	 
	 	(4)	 	to set forth or amend the designations, preferences, conversion or other rights, voting
powers, restrictions, limitations as to distributions, qualifications or terms or conditions
of redemption of the Holders of any additional Partnership Interests issued pursuant to
Article 4;
	 
	 	(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;
	 
	 	(6)	 	(a) to reflect such changes as are reasonably necessary for the General Partner to maintain
its status as a REIT or to satisfy the REIT Requirements, or (b) to reflect the Transfer of all or any part of a Partnership Interest among the General Partner and any
Disregarded Entity with respect to the General Partner;
	 
	 	(7)	 	to modify either or both of the manner in which items of Net Income or Net Loss are allocated
pursuant to Article VI or the manner in which Capital Accounts are adjusted, computed, or
maintained (but in each case only to the extent otherwise provided in this Agreement and as
may be permitted under applicable law);
	 
	 	(8)	 	to reflect the issuance of additional Partnership Interests in accordance with Section 4.2;
and
	 
	 	(9)	 	to reflect any other modification to this Agreement as is reasonably necessary for the
business or operations of the Partnership or the General Partner and which does not violate
Section 7.3.D.

D. Notwithstanding Sections 7.3.B, 7.3.C and 14.2 hereof, this Agreement shall not be amended, and
no action may be taken by the General Partner, without the Consent of each Partner adversely
affected thereby, if such amendment or action would (i) convert a Limited Partner Interest in the
Partnership into a General Partner Interest (except as a result of the General Partner acquiring
such Partnership Interest), (ii) modify the limited liability of a Limited Partner, (iii) alter the
rights of any Partner to receive the distributions to which such Partner is

43

 

entitled pursuant to
Article 5 or Section 13.2.A(4) hereof, or alter the allocations specified in Article 6 hereof
(except, in any case, as permitted pursuant to Sections 4.2, 5.5, 7.3.C and Article 6 hereof), (iv)
alter or modify the Redemption rights, Cash Amount or REIT Shares Amount as set forth in Section
15.1 hereof, or amend or modify any related definitions, (v) alter or modify Section 11.2 hereof,
(vi) subject to Section 7.9.D, remove, alter or amend the powers and restrictions related to REIT
Requirements or permitting the General Partner to avoid paying tax under Code Sections 857 or 4981
contained in Sections 7.1 and 7.3, or (vii) amend this Section 7.3.D. Further, no amendment may
alter the restrictions on the General Partner’s authority set forth elsewhere in this Section 7.3
without the Consent specified therein. Any such amendment or action consented to by any Partner
shall be effective as to that Partner, notwithstanding the absence of such consent by any other
Partner.

          Section 7.4 Reimbursement of the General Partner.

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

B. Subject to Sections 7.4.D and 15.12 hereof, the Partnership shall be responsible for and shall
pay all expenses relating to the Partnership’s and the General Partner’s organization and the
ownership of each of their assets and operations. The General Partner is hereby authorized to pay
compensation for accounting, administrative, legal, technical, management and other services
rendered to the Partnership. The Partnership shall be liable for, and shall reimburse the General
Partner, on a monthly basis, or such other basis as the General Partner may determine in its sole
and absolute discretion, for all sums expended in connection with the Partnership’s
business, including, without limitation, (i) expenses relating to the ownership of interests in and
management and operation of the Partnership, (ii) compensation of officers and employees,
including, without limitation, payments under future compensation plans, of the General Partner, or
the Partnership that may provide for stock units, or phantom stock, pursuant to which employees of
the General Partner, or the Partnership will receive payments based upon dividends on or the value
of REIT Shares, (iii) director fees and expenses of the General Partner or its Affiliates, (iv) any
expenses (other than the purchase price) incurred by the General Partner in connection with the
redemption or other repurchase of its Capital Shares, and (v) all costs and expenses of the General
Partner being a public company, including, without limitation, costs of filings with the SEC,
reports and other distributions to its stockholders; provided, however, that the amount of any
reimbursement shall be reduced by any interest earned by the General Partner with respect to bank
accounts or other instruments or accounts held by it on behalf of the Partnership as permitted
pursuant to Section 7.5 hereof. The Partners acknowledge that all such expenses of the General
Partner are deemed to be for the benefit of the Partnership. Such reimbursements shall be in
addition to any reimbursement of the General Partner as a result of indemnification pursuant to
Section 7.7 hereof.

C. If the General Partner shall elect to purchase from its stockholders Capital Shares for the
purpose of delivering such Capital 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

44

 

General Partner in the future,
in lieu of the treatment specified in Section 4.7.B., the purchase price paid by the General
Partner for such Capital Shares shall be considered expenses of the Partnership and shall be
advanced to the General Partner or reimbursed to the General Partner, subject to the condition
that: (1) if such REIT Shares subsequently are sold by the General Partner, the General Partner
shall pay or cause to be paid to the Partnership any proceeds received by the General Partner for
such REIT Shares (which sales proceeds shall include the amount of dividends reinvested under any
dividend reinvestment or similar program; provided, that a transfer of REIT Shares for Partnership
Units pursuant to Section 15.1 would not be considered a sale for such purposes); and (2) if such
REIT Shares are not retransferred by the General Partner within 30 days after the purchase thereof,
or the General Partner otherwise determines not to retransfer such REIT Shares, the General Partner
shall cause the Partnership to redeem a number of Partnership Units determined in accordance with
Section 4.7.B, as adjusted, to the extent the General Partner determines is necessary or advisable
in its sole and absolute discretion, (x) pursuant to Section 7.5 (in the event the General Partner
acquires material assets, other than on behalf of the Partnership) and (y) for stock dividends and
distributions, stock splits and subdivisions, reverse stock splits and combinations, distributions
of rights, warrants or options, and distributions of evidences of indebtedness or assets relating
to assets not received by the General Partner pursuant to a pro rata distribution by the
Partnership (in which case such advancement or reimbursement of expenses shall be treated as having
been made as a distribution in redemption of such number of Partnership Units held by the General
Partner).

D. To the extent practicable, Partnership expenses shall be billed directly to and paid by the
Partnership and, subject to Section 15.12 hereof, if and to the extent any reimbursements to the
General Partner or any of its Affiliates by the Partnership pursuant to this Section 7.4 constitute
gross income to such Person (as opposed to the repayment of advances made by such Person on behalf
of the Partnership), such amounts shall be treated as “guaranteed payments” within the
meaning of Code Section 707(c) and shall not be treated as distributions for purposes of computing
the Partners’ Capital Accounts.

          Section 7.5 Outside Activities of the General Partner. The General Partner shall not directly or indirectly enter into or conduct any business,
other than in connection with, (a) the ownership, acquisition and disposition of Partnership
Interests, (b) the management of the business and affairs of the Partnership, (c) the operation of
the General Partner as a reporting company with a class (or classes) of securities registered under
the Exchange Act, (d) its operations as a REIT, (e) the offering, sale, syndication, private
placement or public offering of stock, bonds, securities or other interests, (f) financing or
refinancing of any type related to the Partnership or its assets or activities, and (g) such
activities as are incidental thereto; provided, however, that, except as otherwise provided herein,
any funds raised by the General Partner pursuant to the preceding clauses (e) and (f) shall be made
available to the Partnership, whether as Capital Contributions, loans or otherwise, as appropriate,
and, provided, further that the General Partner may, in its sole and absolute discretion, from time
to time hold or acquire assets in its own name or otherwise other than through the Partnership so
long as the General Partner takes commercially reasonable measures to ensure that the economic
benefits and burdens of such Property are otherwise vested in the Partnership, through assignment,
mortgage loan or otherwise or, if it is not commercially reasonable to vest such economic interests
in the Partnership, the Partners shall negotiate in good faith to amend this Agreement, including,
without limitation, the definition of “Adjustment Factor,” to reflect such activities and the
direct

45

 

ownership of assets by the General Partner. Nothing contained herein shall be deemed to
prohibit the General Partner from executing guarantees of Partnership debt. The General Partner and
all Disregarded Entities with respect to the General Partner, taken as a group, shall not own any
assets or take title to assets (other than temporarily in connection with an acquisition prior to
contributing such assets to the Partnership) other than (i) interests in Disregarded Entities with
respect to the General Partner, (ii) Partnership Interests as the General Partner, (iii) a minority
interest in any Subsidiary of the Partnership that the General Partner holds to maintain such
Subsidiary’s status as a partnership for Federal income tax purposes or otherwise, and (iv) such
cash and cash equivalents, bank accounts or similar instruments or accounts as such group deems
reasonably necessary, taking into account Section 7.1.D hereof and the requirements necessary for
the General Partner to qualify as a REIT and for the General Partner to carry out its
responsibilities contemplated under this Agreement and the Charter. Any Limited Partner Interests
acquired by the General Partner, whether pursuant to the exercise by a Limited Partner of its right
to Redemption, or otherwise, shall be automatically converted into a General Partner Interest
comprised of an identical number of Partnership Units with the same terms as the class or series so
acquired. Any Affiliates of the General Partner may acquire Limited Partner Interests and shall,
except as expressly provided in this Agreement, be entitled to exercise all rights of a Limited
Partner relating to such Limited Partner Interests.

          Section 7.6 Transactions with Affiliates.

A. The Partnership may lend or contribute funds to, and borrow funds from, Persons in which the
Partnership has an equity investment, and such Persons may borrow funds from, and lend or
contribute funds to, 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 Person.

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

C. The General Partner and its Affiliates may sell, transfer or convey any property to, or purchase
any property from, the Partnership, directly or indirectly, on terms and conditions established by
the General Partner in its sole and absolute discretion.

D. The General Partner, in its sole and absolute discretion and without the approval of the
Partners or any of them or any other Persons, may propose and adopt (on behalf of the Partnership)
employee benefit plans (including without limitation plans that contemplate the issuance of LTIP
Units) 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 General Partner, the Partnership or any
of the Partnership’s Subsidiaries.

46

 

          Section 7.7 Indemnification.

A. To the fullest extent permitted by applicable law, the Partnership shall indemnify each
Indemnitee from and against any and all losses, claims, damages, liabilities, joint or several,
expenses (including, without limitation, attorney’s fees and other legal fees and expenses),
judgments, fines, settlements and other amounts arising from any and all claims, demands, actions,
suits or proceedings, civil, criminal, administrative or investigative, that relate to the
operations of the Partnership (“Actions”) as set forth in this Agreement in which such Indemnitee
may be involved, or is threatened to be involved, as a party or otherwise; provided, however, that
the Partnership shall not indemnify an Indemnitee (i) if the act or omission of the Indemnitee was
material to the matter giving rise to the Action and either was committed in bad faith or was the
result of active and deliberate dishonesty; (ii) in the case of any criminal proceeding, if the
Indemnitee had reasonable cause to believe that the act or omission was unlawful; or (iii) for any
transaction for which such Indemnitee actually received an improper personal benefit in violation
or breach of any provision of this Agreement; and provided, further, that no payments pursuant to
this Agreement shall be made by the Partnership to indemnify or advance funds to any Indemnitee (x)
with respect to any Action initiated or brought voluntarily by such Indemnitee (and not by way of
defense) unless (I) approved or authorized by the General Partner or (II) incurred to establish or
enforce such Indemnitee’s right to indemnification under this Agreement, and (y) in connection with
one or more Actions or claims brought by the Partnership or involving such Indemnitee if such
Indemnitee is found liable to the Partnership on any portion of any claim in any such Action.

          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), and the General Partner is hereby authorized and empowered, on behalf of the Partnership, to enter into one
or more indemnity agreements consistent with the provisions of this Section 7.7 in favor of any
Indemnitee having or potentially having liability for any such indebtedness. It is the intention of
this Section 7.7.A that the Partnership indemnify each Indemnitee to the fullest extent permitted
by law and this Agreement. The termination of any proceeding by judgment, order or settlement does
not create a presumption that the Indemnitee did not meet the requisite standard of conduct set
forth in this Section 7.7.A. The termination of any proceeding by conviction of an Indemnitee or
upon a plea of nolo contendere or its equivalent by an Indemnitee, or an entry of an order of
probation against an Indemnitee prior to judgment, does not create a presumption that such
Indemnitee acted in a manner contrary to that specified in this Section 7.7.A with respect to the
subject matter of such proceeding. Any indemnification pursuant to this Section 7.7 shall be made
only out of the assets of the Partnership, and neither the General Partner nor any other Holder
shall have any obligation to contribute to the capital of the Partnership or otherwise provide
funds to enable the Partnership to fund its obligations under this Section 7.7.

B. To the fullest extent permitted by law, expenses incurred by an Indemnitee who is a party to a
proceeding or otherwise subject to or the focus of or is involved in any Action shall be paid or
reimbursed by the Partnership as incurred by the Indemnitee in advance of the final disposition of
the Action upon receipt by the Partnership of (i) a written affirmation by the

47

 

Indemnitee
of the Indemnitee’s good faith belief that the standard of conduct necessary for indemnification by the
Partnership as authorized in Section 7.7.A has been met, and (ii) a written undertaking by or on
behalf of the Indemnitee to repay the amount if it shall ultimately be determined that the standard
of conduct has not been met.

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

D. The Partnership may, but shall not be obligated to, purchase and maintain insurance, on behalf
of any of the Indemnitees and such other Persons as the General Partner shall determine, against
any liability that may be asserted against or expenses that may be incurred by such Person in
connection with the Partnership’s activities, regardless of whether the Partnership would have the
power to indemnify such Person against such liability under the provisions of this Agreement.

E. Any liabilities which an Indemnitee incurs as a result of acting on behalf of the Partnership or
the General Partner (whether as a fiduciary or otherwise) in connection with the operation,
administration or maintenance of an employee benefit plan or any related trust or funding mechanism
(whether such liabilities are in the form of excise taxes assessed by the IRS, penalties assessed
by the U.S. Department of Labor, restitutions to such a plan or trust or other funding mechanism or
to a participant or beneficiary of such plan, trust or other funding mechanism, or otherwise) shall
be treated as liabilities or judgments or fines under this Section 7.7, unless such liabilities
arise as a result of (i) an act or omission of such Indemnitee
that was material to the matter giving rise to the Action and either was committed in bad faith or was the
result of active and deliberate dishonesty; (ii) in the case of any criminal proceeding, an act or
omission that such Indemnitee had reasonable cause to believe was unlawful, or (iii) any
transaction in which such Indemnitee actually received an improper personal benefit in violation or
breach of any provision of this Agreement.

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

G. An Indemnitee shall not be denied 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

48

 

occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when
such claims may arise or be asserted.

I. It is the intent of the parties that any amounts paid by the Partnership to the General Partner
pursuant to this Section 7.7 shall be treated as “guaranteed payments” within the meaning of Code
Section 707(c) and shall not be treated as distributions for purposes of computing the Partners’
Capital Accounts.

          Section 7.8 Liability of the General Partner.

A. The Limited Partners agree that: (i) the General Partner is acting for the benefit of the
Partnership, the Limited Partners and the General Partner’s stockholders collectively; (ii) in the
event of a conflict between the interests of the Partnership or any Partner, on the one hand, and
the separate interests of the General Partner or its stockholders, on the other hand, the General
Partner is under no obligation not to give priority to the separate interests of the General
Partner or the stockholders of the General Partner, and any action or failure to act on the part of
the General Partner or its directors that gives priority to the separate interests of the General
Partner or its stockholders that does not result in a violation of the contract rights of the
Limited Partners under this Agreement does not violate the duty of loyalty owed by the General
Partner to the Partnership and/or the Partners; and (iii) the General Partner shall not be liable
to the Partnership or to any Partner for monetary damages for losses sustained, liabilities
incurred or benefits not derived by the Partnership or any Limited Partner in connection with such
decisions, except for liability for the General Partner’s intentional harm or gross negligence.

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

C. Any obligation or liability whatsoever of the General Partner which may arise at any time under
this Agreement or any other instrument, transaction, or undertaking contemplated hereby shall be
satisfied, if at all, out of the assets of the General Partner or the Partnership only. No such
obligation or liability shall be personally binding upon, nor shall resort for the enforcement
thereof be had to, any of the General Partner’s directors, stockholders, officers, employees, or
agents, regardless of whether such obligation or liability is in the nature of contract, tort or
otherwise. Notwithstanding anything to the contrary set forth in this Agreement, none of the
directors or officers of the General Partner shall be liable or accountable in damages or otherwise
to the Partnership, any Partners, or any Assignees for losses sustained, liabilities incurred or
benefits not derived as a result of errors in judgment or mistakes of fact or law or of any act or
omission.

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 and its
officers’ and directors’ 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

49

 

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.

E. Notwithstanding anything herein to the contrary, except for liability for intentional harm or
gross negligence on the part of such Partner or pursuant to any express indemnities given to the
Partnership by any Partner pursuant to any other written instrument, no Partner shall have any
personal liability whatsoever, to the Partnership or to the other Partners, or for the debts or
liabilities of the Partnership or the Partnership’s obligations hereunder, and the full recourse of
the other Partner(s) shall be limited to the interest of that Partner in the Partnership. Without
limitation of the foregoing, and except for liability for intentional harm or gross negligence on
the part of any Partner, or pursuant to any such express indemnity, no property or assets of such
Partner, other than its interest in the Partnership, shall be subject to levy, execution or other
enforcement procedures for the satisfaction of any judgment (or other judicial process) in favor of
any other Partner(s) and arising out of, or in connection with, this Agreement. This Agreement is
executed by the officers of the General Partner solely as officers of the same and not in their own
individual capacities.

F. To the extent that, at law or in equity, the General Partner has duties (including fiduciary
duties) and liabilities relating thereto to the Partnership or the Limited Partners, the General
Partner shall not be liable to the Partnership or to any other Partner for its good faith reliance
on the provisions of this Agreement. The provisions of this Agreement, to the extent that they
restrict or modify the duties and liabilities of the General Partner under the Act or otherwise
existing at law or in equity, are agreed by the Partners to replace such other duties and
liabilities of such General Partner.

G. Whenever in this Agreement the General Partner is permitted or required to make a decision (i)
in its “sole and absolute discretion,” “sole discretion” or “discretion” or under a grant of
similar authority or latitude, the General Partner shall be entitled to consider only such interests and factors as it desires, including its own interests, and shall have no duty or
obligation to give any consideration to any interest or factors affecting the Partnership or the
Partners or any of them, or (ii) in its “good faith” or under another expressed standard, the
General Partner shall act under such express standard and shall not be subject to any other or
different standards imposed by this Agreement or any other agreement contemplated herein or by
relevant provisions of law or in equity or otherwise. If any question should arise with respect to
the operation of the Partnership, which is not otherwise specifically provided for in this
Agreement or the Act, or with respect to the interpretation of this Agreement, the General Partner
is hereby authorized to make a final determination with respect to any such question and to
interpret this Agreement in such a manner as it shall deem, in its sole discretion, to be fair and
equitable, and its determination and interpretations so made shall be final and binding on all
parties. The General Partner’s “sole and absolute discretion,” “sole discretion” and “discretion”
under this Agreement shall be exercised consistently with the General Partner’s fiduciary duties
and obligation of good faith and fair dealing under the Act.

          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,

50

 

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 that the General Partner reasonably believes to be within
such Person’s professional or expert competence shall be conclusively presumed to have been done or
omitted in good faith and in accordance with such opinion.

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 or agents or a duly appointed
attorney or attorneys-in-fact. Each such officer, agent or attorney shall, to the extent
authorized by the General Partner, have full power and authority to do and perform all and every
act and duty that is permitted or required to be done by the General Partner hereunder.

D. Notwithstanding any other provision of this Agreement or the Act, any action of the General
Partner on behalf of the Partnership or any decision of the General Partner to refrain from acting
on behalf of the Partnership, undertaken in the good faith belief that such action or omission is
necessary or advisable in order (i) to protect the ability of the General Partner to continue to
qualify as a REIT, (ii) for the General Partner otherwise to satisfy the REIT Requirements, (iii)
for the General Partner to avoid incurring any taxes under Code Section 857 or Code Section 4981,
or (iv) for any General Partner Affiliate to continue to qualify as a “qualified REIT subsidiary”
(within the meaning of Code Section 856(i)(2)), 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 with other Partners or Persons, shall have any ownership interest in
such Partnership assets or any portion thereof. Title to any or all of the Partnership assets may
be held in the name of the Partnership, the General Partner 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 or such nominee or Affiliate for the use and benefit of the Partnership in accordance with
the provisions of this Agreement. All Partnership assets shall be recorded as the property of the
Partnership in its books and records, irrespective of the name in which legal title to such
Partnership assets is held.

          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 the consent or approval of any other Partner, or Person, to encumber, sell or otherwise use
in any manner any and all assets of the Partnership and to enter into any contracts on behalf of
the Partnership, and take any and all actions on behalf of the Partnership, and such Person shall
be entitled to deal with the General Partner as if it were the Partnership’s sole party in
interest, both legally and beneficially. Each Limited Partner hereby waives any and all defenses or
other remedies that may be available

51

 

against such Person to contest, negate or disaffirm any action of the General Partner in connection with any such dealing. In no event shall any Person dealing
with the General Partner or its representatives be obligated to ascertain that the terms of this
Agreement have been complied with or to inquire into the necessity or expediency of any act or
action of the General Partner or its representatives. Each and every certificate, document or other
instrument executed on behalf of the Partnership by the General Partner or its representatives
shall be conclusive evidence in favor of any and every Person relying thereon or claiming
thereunder that (i) at the time of the execution and delivery of such certificate, document or
instrument, this Agreement was in full force and effect, (ii) the Person executing and delivering
such certificate, document or instrument was duly authorized and empowered to do so for and on
behalf of the Partnership and (iii) such certificate, document or instrument was duly executed and
delivered in accordance with the terms and provisions of this Agreement and is binding upon the
Partnership.

ARTICLE 8

RIGHTS AND OBLIGATIONS OF LIMITED PARTNERS

          Section 8.1 Limitation of Liability. No Limited Partner shall have any liability under this Agreement except for intentional
harm or gross negligence on the part of such Limited Partner or as expressly provided in this
Agreement (including, without limitation, Section 10.4 hereof) or under the Act.

          Section 8.2 Management of Business. Subject to the rights and powers of the General Partner hereunder, no Limited Partner or
Assignee (other than the General Partner, any of its Affiliates or any officer, director, member,
employee, partner, agent or trustee of the General Partner, the Partnership or any of their
Affiliates, in their capacity as such) shall take part in the operations, management or control
(within the meaning of the Act) of the Partnership’s business, transact any business in the
Partnership’s name or have the power to sign documents for or otherwise bind the Partnership. The
transaction of any such business by the General Partner, any of its Affiliates or any officer,
director, member, employee, partner, agent, representative, or trustee of the General Partner, the
Partnership or any of their Affiliates, in their capacity as such, shall not affect, impair or
eliminate the limitations on the liability of the Limited Partners or Assignees under this
Agreement.

          Section 8.3 Outside Activities of Limited Partners. Subject to any agreements entered into pursuant to Section 7.6 hereof and any other
agreements entered into by a Limited Partner or any of its Affiliates with the General Partner, the
Partnership or a Subsidiary (including, without limitation, any employment agreement), any Limited
Partner and any Assignee, officer, director, employee, agent, trustee, Affiliate, member or
stockholder of any Limited Partner shall be entitled to and may have business interests and engage
in business activities in addition to those relating to the Partnership, including business
interests and activities that are in direct or indirect competition with the Partnership or that
are enhanced by the activities of the Partnership. Neither the Partnership nor any Partner shall
have any rights by virtue of this Agreement in any business ventures of any Limited Partner or
Assignee. Subject to such agreements, none of the Limited Partners nor any other Person shall have
any rights by virtue of this Agreement or the partnership relationship established hereby in any
business ventures of any other Person (other than the General Partner), and such Person shall have
no obligation pursuant to this Agreement, subject to Section 7.6 hereof and any other agreements
entered into by a Limited Partner or its Affiliates

52

 

with the General Partner, the Partnership or a Subsidiary, to offer any interest in any such business ventures to the Partnership, any Limited
Partner, or any such other Person, even if such opportunity is of a character that, if presented to
the Partnership, any Limited Partner or such other Person, could be taken by such Person.

          Section 8.4 Return of Capital. Except pursuant to the rights of Redemption set forth in Section 15.1 hereof, 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 in Article 5 and Article 6 hereof 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, the General Partner shall deliver to each Limited Partner a copy of any information mailed to all of the common stockholders of the General Partner as soon as
practicable after such mailing.

B. The Partnership shall notify any Limited Partner that is a Qualifying Party, on request, of the
then current Adjustment Factor and any change made to the Adjustment Factor shall be set forth in
the quarterly report required by Section 9.3.B hereof immediately following the date such change
becomes effective.

C. Notwithstanding any other provision of this Section 8.5, the General Partner may keep
confidential from the Limited Partners (or any of them), 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 believes to be in the nature of trade secrets or other information the
disclosure of which the General Partner in good faith believes is not in the best interests of the
Partnership or the General Partner or (ii) the Partnership or the General Partner is required by
law or by agreement to keep confidential.

D. Upon written request by any Limited Partner, the General Partner shall cause the ownership of
Partnership Units by such Limited Partner to be evidenced by a certificate for units in such form
as the General Partner may determine with respect to any class of Partnership Units issued from
time to time under this Agreement. Any officer of the General Partner may direct a new certificate
or certificates to be issued in place of any certificate or certificates theretofore issued by the
Partnership alleged to have been lost, destroyed, stolen or mutilated, upon the making of an
affidavit of that fact by the person claiming the certificate to be lost, destroyed, stolen or
mutilated. Unless otherwise determined by an officer of the General Partner, the owner of such
lost, destroyed, stolen or mutilated certificate or certificates, or his or her legal
representative, shall be required, as a condition precedent to the issuance of a new certificate or
certificates, to give the Partnership a bond in such sums as the General Partner may direct as
indemnity against any claim that may be made against the Partnership.

53

 

          Section 8.6 Partnership Right to Call Limited Partner Interests.

          Notwithstanding any other provision of this Agreement, on and after the date on which the
aggregate Percentage Interests of the Limited Partners are less than one percent (1%), the
Partnership shall have the right, but not the obligation, from time to time and at any time to
redeem any and all outstanding Limited Partner Interests by treating any Limited Partner as a
Tendering Party who has delivered a Notice of Redemption pursuant to Section 15.1 hereof for the
amount of Partnership Common Units to be specified by the General Partner, in its sole and absolute
discretion, by notice to such Limited Partner that the Partnership has elected to exercise its
rights under this Section 8.6. Such notice given by the General Partner to a Limited Partner
pursuant to this Section 8.6 shall be treated as if it were a Notice of Redemption delivered to the
General Partner by such Limited Partner. For purposes of this Section 8.6, (a) any Limited Partner
(whether or not otherwise a Qualifying Party) may, in the General Partner’s sole and absolute
discretion, be treated as a Qualifying Party that is a Tendering Party and (b) the provisions of
Sections 15.1.F(2) and 15.1.F(3) hereof shall not apply, but the remainder of Section 15.1 hereof
shall apply, mutatis mutandis.

          Section 8.7 Rights as Objecting Partner.

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

ARTICLE 9

BOOKS, RECORDS, ACCOUNTING AND REPORTS

          Section 9.1 Records and Accounting.

A. The General Partner shall keep or cause to be kept at the principal place of business of the
Partnership those records and documents, if any, required to be maintained by the Act and any other
books and records deemed by the General Partner to be appropriate with respect to the Partnership’s
business, including, without limitation, all books and records necessary to provide to the Limited
Partners any information, lists and copies of documents required to be provided pursuant to Section
8.5.A, Section 9.3 or Article 13 hereof. Any records maintained by or on behalf of the Partnership
in the regular course of its business may be kept on any information storage device, provided that
the records so maintained are convertible into clearly legible written form within a reasonable
period of time.

B. The books of the Partnership shall be maintained, for financial and tax reporting purposes, on
an accrual basis in accordance with generally accepted accounting principles, or on such other
basis as the General Partner determines to be necessary or appropriate. To the extent permitted by
sound accounting practices and principles, the Partnership and the General Partner may operate with
integrated or consolidated accounting records, operations and principles.

          Section 9.2 Partnership Year. For purposes of this Agreement, “Partnership Year” means the fiscal year of the
Partnership, which shall be the same as the tax year of the Partnership. The tax year shall be the
calendar year unless otherwise required by the Code.

54

 

          Section 9.3 Reports.

A. As soon as practicable, but in no event later than one hundred five (105) days after the close
of each Partnership Year, the General Partner shall cause to be mailed to each Limited Partner of
record as of the close of the Partnership Year, financial statements of the Partnership, or of the
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 sixty (60) days after the close of each
calendar quarter (except the last calendar quarter of each year), the General Partner shall cause
to be mailed to each Limited Partner of record as of the last day of the calendar quarter, a report
containing unaudited financial statements of the Partnership for such calendar quarter, 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.

C. The General Partner shall have satisfied its obligations under Section 9.3.A and Section 9.3.B
by posting or making available the reports required by this Section 9.3 on the website maintained
from time to time by the Partnership or the General Partner, provided that such reports are able to
be printed or downloaded from such website.

D. At the request of any Limited Partner, the General Partner shall provide access to the books,
records and workpapers upon which the reports required by this Section 9.3 are based, to the extent
required by the Act.

ARTICLE 10

TAX MATTERS

          Section 10.1 Preparation of Tax Returns. The General Partner shall arrange for the preparation and timely filing of all returns with
respect to Partnership income, gains, deductions, losses and other items required of the
Partnership for Federal and state income tax purposes and shall use all reasonable 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 and any other tax reporting purposes.
The Limited Partners shall promptly provide the General Partner with such information relating to
the Contributed Properties as is readily available to the Limited Partners, including tax basis and
other relevant information, as may be reasonably requested by the General Partner from time to
time.

          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, including, but
not limited to, the election under Code Section 754. The General Partner shall have the right to
seek to revoke any such election (including, without limitation, any election under Code Section
754) upon the General Partner’s determination in its sole and absolute discretion that such
revocation is in the best interests of the Partners.

55

 

          Section 10.3 Tax Matters Partner.

A. The General Partner shall be the “tax matters partner” of the Partnership for federal income tax
purposes. The tax matters partner shall receive no compensation for its services. All third-party
costs and expenses incurred by the tax matters partner in performing its duties as such (including
legal and accounting fees and expenses) shall be borne by the Partnership in addition to any
reimbursement pursuant to Section 7.4 hereof. Nothing herein shall be construed to restrict the
Partnership from engaging an accounting firm to assist the tax matters partner in discharging its
duties hereunder.

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 (as the case may be) or (ii) who is a “notice
partner” (as defined in Code Section 6231) or a member of a “notice group” (as defined in Code
Section 6223(b)(2));
	 
	(2)	 	in the event that a notice of a final administrative adjustment at the Partnership level of
any item required to be taken into account by a Partner for tax purposes (a “Final
Adjustment”) is mailed to the tax matters partner, to seek judicial review of such Final
Adjustment, including the filing of a petition for readjustment with the United States Tax
Court or the United States Claims Court, or the filing of a complaint for refund with the
District Court of the United States for the district in which the Partnership’s principal
place of business is located;
	 
	(3)	 	to intervene in any action brought by any other Partner for judicial review of a final
adjustment;
	 
	(4)	 	to file a request for an administrative adjustment with the IRS at any time and, if any part
of such request is not allowed by the IRS, to file an appropriate pleading (petition or
complaint) for judicial review with respect to such request;
	 
	(5)	 	to enter into an agreement with the IRS to extend the period for assessing any tax that is
attributable to any item required to be taken into account by a Partner for tax purposes, or
an item affected by such item; and
	 
	(6)	 	to take any other action on behalf of the Partners or any of them in connection with any tax
audit or judicial review proceeding to the extent permitted by applicable law or regulations.

56

 

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

          Section 10.4 Withholding. Each Limited Partner hereby authorizes the Partnership to withhold from or pay on behalf of
or with respect to such Limited Partner any amount of Federal, state, local or foreign taxes that
the General Partner determines the Partnership is required to withhold or pay with respect to any
amount distributable or allocable to such Limited Partner pursuant to this Agreement, including,
without limitation, any taxes required to be withheld or paid by the Partnership pursuant to Code Section 1441, Code Section 1442, Code Section 1445 or Code
Section 1446. Any amount withheld with respect to a Limited Partner pursuant to this Section 10.4
shall be treated as paid or distributed, as applicable, to such Limited Partner for all purposes
under this Agreement. Any amount paid on behalf of or with respect to a Limited Partner, in excess
of any such withheld amount, shall constitute a loan by the Partnership to such Limited Partner,
which loan shall be repaid by such Limited Partner within thirty (30) days after the affected
Limited Partner receives written notice from the General Partner that such payment must be made,
provided that the Limited Partner shall not be required to repay such deemed loan if either (i) the
Partnership withholds such payment from a distribution that 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 Cash of the Partnership that would, but for such
payment, be distributed to the Limited Partner. Any amounts payable by a Limited Partner hereunder
shall bear interest at the base rate on corporate loans at large United States money center
commercial banks, as published from time to time in the Wall Street Journal (but not higher than
the maximum lawful rate) from the date such amount is due (i.e., thirty (30) days after the Limited
Partner receives written notice of such amount) until such amount is paid in full.

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

ARTICLE 11

PARTNER TRANSFERS AND WITHDRAWALS

          Section 11.1 Transfer.

A. No part of the interest of a Partner shall be subject to the claims of any creditor, to any
spouse for alimony or support, or to legal process, and may not be voluntarily or involuntarily
alienated or encumbered except as may be specifically provided for in this Agreement.

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

57

 

C. No Transfer of any Partnership Interest may be made to a lender to the Partnership or any Person
who is related (within the meaning of Section 1.752-4(b) of the Regulations) to any lender to the
Partnership whose loan constitutes a Nonrecourse Liability, without the Consent of the General
Partner; provided, however, that, as a condition to such Consent, the lender may be required to
enter into an arrangement with the Partnership and the General Partner to redeem or exchange for
the REIT Shares Amount any Partnership Units in which a security interest is held by such lender
simultaneously with the time at which such lender would be deemed to be a partner in the
Partnership for purposes of allocating liabilities to such lender under Section 752 of the Code
(provided that, for purpose of calculating the REIT Shares Amount in this Section 11.1.C, “Tendered Units” shall mean all such Partnership Units in which a security interest is held
by such lender).

          Section 11.2 Transfer of General Partner’s Partnership Interest.

A. Except as provided in Section 11.2.B or Section 11.2.C, and subject to the rights of any Holder
of any Partnership Interest set forth in a Partnership Unit Designation, the General Partner may
not Transfer all or any portion of its Partnership Interest (whether by sale, disposition,
statutory merger or consolidation, liquidation or otherwise) without the Consent of the Limited
Partners. It is a condition to any Transfer of a Partnership Interest of a General Partner
otherwise permitted hereunder (including any Transfer permitted pursuant to Section 11.2.B or
Section 11.2.C) that: (i) coincident with such Transfer, the transferee is admitted as a General
Partner pursuant to Section 12.1 hereof; (ii) the transferee assumes, by operation of law or
express agreement, all of the obligations of the transferor General Partner under this Agreement
with respect to such Transferred Partnership Interest; and (iii) the transferee has executed such
instruments as may be necessary to effectuate such admission and to confirm the agreement of such
transferee to be bound by all the terms and provisions of this Agreement with respect to the
Partnership Interest so acquired and the admission of such transferee as a General Partner.

B. Certain Transactions of the General Partner. Subject to the rights of any Holder of any
Partnership Interest set forth in a Partnership Unit Designation, the General Partner may, without
the Consent of the Limited Partners, Transfer all of its Partnership Interest in connection with
(a) a merger, consolidation or other combination of its assets with another entity, (b) a sale of
all or substantially all of its assets not in the ordinary course of the Partnership’s business or
(c) a reclassification, recapitalization or change of any outstanding shares of the General
Partner’s stock or other outstanding equity interests (each, a “Termination Transaction”) if:

          (i) in connection with such Termination Transaction, all of the Limited Partners will
receive, or will have the right to elect to receive, for each Partnership Common Unit an
amount of cash, securities or other property equal to the product of the Adjustment Factor
and the greatest amount of cash, securities or other property paid to a holder of one REIT
Share in consideration of one REIT Share pursuant to the terms of such Termination
Transaction; provided, that if, in connection with such Termination Transaction, a purchase,
tender or exchange offer shall have been made to and accepted by the holders of the
outstanding REIT Shares, each holder of Partnership Common Units shall receive, or shall
have the right to elect to receive, the greatest amount of cash, securities or other
property which such holder of Partnership Common Units would have

58

 

received had it exercised its right to Redemption pursuant to Article 15 hereof and received REIT
Shares in exchange for its Partnership Common Units immediately prior to the expiration of such
purchase, tender or exchange offer and had thereupon accepted such purchase, tender or exchange offer
and then such Termination Transaction shall have been consummated; or

          (ii) all of the following conditions are met: (w) substantially all of the assets
directly or indirectly owned by the surviving entity are owned directly or indirectly by the
Partnership or another limited partnership or limited liability company which is the survivor
of a merger, consolidation or combination of assets with the Partnership (in each case, the “Surviving Partnership”); (x) Limited Partners that held Partnership Common
Units immediately prior to the consummation of such Termination Transaction own a percentage
interest of the Surviving Partnership based on the relative fair market value of the net
assets of the Partnership and the other net assets of the Surviving Partnership immediately
prior to the consummation of such transaction; (y) the rights, preferences and privileges in
the Surviving Partnership of such Limited Partners are at least as favorable as those in
effect with respect to the Partnership Common Units immediately prior to the consummation of
such transaction and as those applicable to any other limited partners or non-managing
members of the Surviving Partnership; and (z) the rights of such Limited Partners include at
least one of the following: (a) the right to redeem their interests in the Surviving
Partnership for the consideration available to such persons pursuant to Section 11.2.B(i) or
(b) the right to redeem their interests in the Surviving Partnership for cash on terms
substantially equivalent to those in effect with respect to their Partnership Common Units
immediately prior to the consummation of such transaction, or, if the ultimate controlling
person of the Surviving Partnership has publicly traded common equity securities, such
common equity securities, with an exchange ratio based on the determination of relative fair
market value of such securities and the REIT Shares.

C. Notwithstanding the other provisions of this Article 11 (other than Section 11.6.D hereof), the
General Partner may Transfer all of its Partnership Interests at any time to any Person that is, at
the time of such Transfer an Affiliate of the General Partner, including any “qualified REIT
subsidiary” (within the meaning of Code Section 856(i)(2)), without the Consent of any Limited
Partners. The provisions of Section 11.2.B, 11.3, 11.4.A and 11.5 hereof shall not apply to any
Transfer permitted by this Section 11.2.C.

D. Except in connection with Transfers permitted in this Article 11 and as otherwise provided in
Section 12.1 in connection with the Transfer of the General Partner’s entire Partnership Interest,
the General Partner may not voluntarily withdraw as a general partner of the Partnership without
the Consent of the Limited Partners.

          Section 11.3 Limited Partners’ Rights to Transfer.

A. General. Prior to the end of the first Fourteen-Month Period and except as provided in Section
11.1.C hereof, no Limited Partner shall Transfer all or any portion of its Partnership Interest to
any transferee without the Consent of the General Partner; provided, however, that any Limited
Partner may, at any time, without the consent or approval of the General Partner,

59

 

(i) Transfer all or part of its Partnership Interest to any Family Member (including a Transfer by a Family Member
that is an inter vivos or testamentary trust (whether revocable or irrevocable) to a Family Member
that is a beneficiary of such trust), any Charity, any Controlled Entity or any Affiliate, or (ii)
pledge (a “Pledge”) all or any portion of its Partnership Interest to a lending institution as
collateral or security for a bona fide loan or other extension of credit, and Transfer such pledged
Partnership Interest to such lending institution in connection with the exercise of remedies under
such loan or extension of credit (any Transfer or Pledge permitted by this proviso is hereinafter
referred to as a “Permitted Transfer”). After such first Fourteen-Month Period, each Limited
Partner, and each transferee of Partnership Units or Assignee pursuant to a Permitted Transfer, shall have the right to Transfer all or any portion of its Partnership Interest
to any Person, without the Consent of the General Partner but subject to the provisions of Section
11.4 hereof and to satisfaction of each of the following conditions:

	(1)	 	General Partner Right of First Refusal. The transferor Limited Partner (or the Partner’s
estate in the event of the Partner’s death) shall give written notice of the proposed Transfer
to the General Partner, which notice shall state (i) the identity and address of the proposed
transferee and (ii) the amount and type of consideration proposed to be received for the
Transferred Partnership Units. The General Partner shall have ten (10) Business Days upon
which to give the transferor Limited Partner notice of its election to acquire the Partnership
Units on the terms set forth in such notice. If it so elects, it shall purchase the
Partnership Units on such terms within ten (10) Business Days after giving notice of such
election; provided, however, that in the event that the proposed terms involve a purchase for
cash, the General Partner may at its election deliver in lieu of all or any portion of such
cash a note from the General Partner payable to the transferor Limited Partner at a date as
soon as reasonably practicable, but in no event later than one hundred eighty (180) days after
such purchase, and bearing interest at an annual rate equal to the total dividends declared
with respect to one (1) REIT Share for the four (4) preceding fiscal quarters of the General
Partner, divided by the Value as of the closing of such purchase; and provided, further, that
such closing may be deferred to the extent necessary to effect compliance with the
Hart-Scott-Rodino Act, if applicable, and any other applicable requirements of law. If it does
not so elect, the transferor Limited Partner may Transfer such Partnership Units to a third
party, on terms no more favorable to the transferee than the proposed terms, subject to the
other conditions of this Section 11.3.
	 
	(2)	 	Qualified Transferee. Any Transfer of a Partnership Interest shall be made only to a single
Qualified Transferee; provided, however, that, for such purposes, all Qualified Transferees
that are Affiliates, or that comprise investment accounts or funds managed by a single
Qualified Transferee and its Affiliates, shall be considered together to be a single Qualified
Transferee; and provided, further, that each Transfer meeting the minimum Transfer restriction
of Section 11.3.A(4) hereof may be to a separate Qualified Transferee.
	 
	(3)	 	Opinion of Counsel. The transferor Limited Partner shall deliver or cause to be delivered to
the General Partner an opinion of counsel reasonably satisfactory to it to the effect that the
proposed Transfer may be effected without registration under the Securities Act and will not
otherwise violate the registration provisions of the Securities Act and the regulations
promulgated thereunder or violate any state securities laws or regulations applicable to the
Partnership or the Partnership Interests Transferred; provided, however,

60

 

that the General Partner may, in its sole discretion, waive this condition upon the request of the transferor
Limited Partner. If, in the opinion of such counsel, such Transfer would require the filing of
a registration statement under the Securities Act or would otherwise violate any Federal or
state securities laws or regulations applicable to the Partnership or the Partnership Units,
the General Partner may prohibit any Transfer otherwise permitted under this Section 11.3 by a
Limited Partner of Partnership Interests.

	(4)	 	Minimum Transfer Restriction. Any Transferring Partner must Transfer not less than the
lesser of (i) five hundred (500) Partnership Units or (ii) all of the remaining Partnership Units owned by such Transferring Partner, without, in each case, the Consent of the General
Partner; provided, however, that, for purposes of determining compliance with the foregoing
restriction, all Partnership Units owned by Affiliates of a Limited Partner shall be
considered to be owned by such Limited Partner.
	 
	(5)	 	Exception for Permitted Transfers. The conditions of Sections 11.3.A(1) through 11.3.A(4)
hereof shall not apply in the case of a Permitted Transfer.

It is a condition to any Transfer otherwise permitted hereunder (whether or not such Transfer is
effected during or after the first Fourteen-Month Period) that the transferee assumes by operation
of law or express agreement all of the obligations of the transferor Limited Partner under this
Agreement with respect to such Transferred Partnership Interest, and no such Transfer (other than
pursuant to a statutory merger or consolidation wherein all obligations and liabilities of the
transferor Partner are assumed by a successor corporation by operation of law) shall relieve the
transferor Partner of its obligations under this Agreement without the Consent of the General
Partner. Notwithstanding the foregoing, any transferee of any Transferred Partnership Interest
shall be subject to any restrictions on ownership and transfer of stock of the General Partner
contained in the Charter that may limit or restrict such transferee’s ability to exercise its
Redemption rights, including, without limitation, the Ownership Limit. Any transferee, whether or
not admitted as a Substituted Limited Partner, shall take subject to the obligations of the
transferor hereunder. Unless admitted as a Substituted Limited Partner, no transferee, whether by a
voluntary Transfer, by operation of law or otherwise, shall have any rights hereunder, other than
the rights of an Assignee as provided in Section 11.5 hereof.

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

C. Adverse Tax Consequences. Notwithstanding anything to the contrary in this Agreement, the
General Partner shall have the authority (but shall not be required) to take any steps it
determines are necessary or appropriate in its sole and absolute discretion to prevent the
Partnership from being taxable as a corporation for Federal income tax purposes. In furtherance of
the foregoing, except with the Consent of the General Partner, no Transfer by a Limited Partner of
its Partnership Interests (including any Redemption, any conversion of LTIP Units into Partnership
Common Units, any other acquisition of Partnership Units by the General

61

 

Partner or any acquisition of Partnership Units by the Partnership) may be made to or by any Person if such Transfer could (i)
result in the Partnership being treated as an association taxable as a corporation; (ii) result in
a termination of the Partnership under Code Section 708; (iii) be treated as effectuated through an
“established securities market” or a “secondary market (or the substantial equivalent thereof)”
within the meaning of Code Section 7704 and the Regulations promulgated thereunder, (iv) result in
the Partnership being unable to qualify for one or more of the “safe harbors” set forth in
Regulations Section 1.7704-1 (or such other guidance subsequently published by the IRS setting
forth safe harbors under which interests will not be treated as “readily tradable on a secondary
market (or the substantial equivalent thereof)” within the meaning of Section 7704 of the Code) (the “Safe Harbors”) or (v) based on the advice of counsel
to the Partnership or the General Partner, adversely affect the ability of the General Partner to
continue to qualify as a REIT or subject the General Partner to any additional taxes under Code
Section 857 or Code Section 4981.

          Section 11.4 Admission of Substituted Limited Partners.

A. No Limited Partner shall have the right to substitute a transferee (including any transferees
pursuant to Transfers permitted by Section 11.3 hereof) as a Limited Partner in its place. A
transferee of a Limited Partner Interest may be admitted as a Substituted Limited Partner only with
the Consent of the General Partner. The failure or refusal by the General Partner to permit a
transferee of any such interests to become a Substituted Limited Partner shall not give rise to any
cause of action against the Partnership or the General Partner. Subject to the foregoing, an
Assignee shall not be admitted as a Substituted Limited Partner until and unless it furnishes to
the General Partner (i) evidence of acceptance, in form and substance satisfactory to the General
Partner, of all the terms, conditions and applicable obligations of this Agreement, (ii) a
counterpart signature page to this Agreement executed by such Assignee and (iii) such other
documents and instruments as may be required or advisable, in the sole and absolute discretion of
the General Partner, to effect such Assignee’s admission as a Substituted Limited Partner.

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

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

          Section 11.5 Assignees. If the General Partner does not Consent to the admission of any permitted transferee under
Section 11.3 hereof as a Substituted Limited Partner, as described in Section 11.4 hereof, or in
the event that any Partnership Interest is deemed to have been Transferred notwithstanding the
restrictions set forth in this Article 11, such transferee shall be considered an Assignee for
purposes of this Agreement. An Assignee shall be entitled to all the rights of an assignee of a
limited partnership interest under the Act, including the right to receive distributions from the
Partnership and the share of Net Income, Net Losses and other items of

62

 

income, gain, loss, deduction and credit of the Partnership attributable to the Partnership Interest assigned to such
transferee and the rights to Transfer the Partnership Interest provided in this Article 11, but
shall not be deemed to be a holder of a Partnership Interest for any other purpose under this
Agreement (other than as expressly provided in Section 15.1 hereof with respect to a Qualifying
Party that becomes a Tendering Party), and shall not be entitled to effect a Consent or vote with
respect to such Partnership Interest on any matter presented to the Partners for approval (such
right to Consent or vote, to the extent provided in this Agreement or under the Act, fully
remaining with the transferor Limited Partner). In the event that any such transferee desires to make a further Transfer of any such Partnership Interest, 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 a Transfer of a Limited Partner Interest.

          Section 11.6 General Provisions.

A. No Limited Partner may withdraw from the Partnership other than as a result of: (i) a permitted
Transfer of all of such Limited Partner’s Partnership Units in accordance with this Article 11 with
respect to which the transferee becomes a Substituted Limited Partner; (ii) pursuant to a
redemption (or acquisition by the General Partner) of all of its Partnership Units pursuant to a
Redemption under Section 15.1 hereof and/or pursuant to any Partnership Unit Designation or (iii)
the acquisition by the General Partner of all of such Limited Partner’s Partnership Interest,
whether or not pursuant to Section 15.1.B hereof.

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

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

63

 

and, in the case of a Transfer other than a Redemption, all distributions of Available Cash thereafter
attributable to such Partnership Unit shall be made to the transferee Partner.

D. In addition to any other restrictions on Transfer herein contained, in no event may any Transfer
of a Partnership Interest by any Partner (including any Redemption, any conversion of LTIP Units
into Partnership Common Units, any acquisition of Partnership Units by the General Partner or any
other acquisition of Partnership Units by the Partnership) be made: (i) to any person or entity who
lacks the legal right, power or capacity to own a Partnership Interest; (ii) in violation of applicable law; (iii) except with the Consent of the General Partner, of any component
portion of a Partnership Interest, such as the Capital Account, or rights to distributions,
separate and apart from all other components of a Partnership Interest; (iv) in the event that such
Transfer could cause either the General Partner or any General Partner Affiliate to cease to comply
with the REIT Requirements or to cease to qualify as a “qualified REIT subsidiary” (within the
meaning of Code Section 856(i)(2)); (v) except with the Consent of the General Partner, if such
Transfer could, based on the advice of counsel to the Partnership or the General Partner, cause a
termination of the Partnership for Federal or state income tax purposes (except as a result of the
Redemption (or acquisition by the General Partner) of all Partnership Common Units held by all
Limited Partners); (vi) if such Transfer could, based on the advice of legal counsel to the
Partnership or the General Partner, cause the Partnership to cease to be classified as a
partnership for federal income tax purposes (except as a result of the Redemption (or acquisition
by the General Partner) of all Partnership Common Units held by all Limited Partners); (vii) if
such Transfer would cause the Partnership to become, with respect to any employee benefit plan
subject to Title I of ERISA, a “party-in-interest” (as defined in ERISA Section 3(14)) or a
“disqualified person” (as defined in Code Section 4975(c)); (viii) if such Transfer could, based on
the advice of legal counsel to the Partnership or the General Partner, cause any portion of the
assets of the Partnership to constitute assets of any employee benefit plan pursuant to Department
of Labor Regulations Section 2510.3-101; (ix) if such Transfer requires the registration of such
Partnership Interest pursuant to any applicable Federal or state securities laws; (x) except with
the Consent of the General Partner, if such Transfer could (i) (1) could be treated as effectuated
through an “established securities market” or a “secondary market” (or the substantial equivalent
thereof) within the meaning of Section 7704 of the Code and the Regulations promulgated thereunder,
(2) could cause the Partnership to become a “publicly traded partnership,” as such term is defined
in Sections 469(k)(2) or 7704(b) of the Code, or (3) could cause the Partnership to fail one or
more of the Safe Harbors; (xi) if such Transfer causes the Partnership (as opposed to the General
Partner) to become a reporting company under the Exchange Act; or (xii) if such Transfer subjects
the Partnership to regulation under the Investment Company Act of 1940, the Investment Advisors Act
of 1940 or ERISA, each as amended. The General Partner shall, in its sole discretion, be permitted
to take all action necessary to prevent the Partnership from being classified as a “publicly traded
partnership” under Code Section 7704.

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

64

 

ARTICLE 12

ADMISSION OF PARTNERS

          Section 12.1 Admission of Successor General Partner. A successor to all of the General Partner’s General Partner Interest pursuant to a Transfer
permitted by 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 immediately upon such
Transfer. Upon any such Transfer and the admission of any such transferee as a successor General
Partner in accordance with this Section 12.1, the transferor General Partner shall be relieved of
its obligations under this Agreement and shall cease to be a general partner of the Partnership without any separate Consent of the Limited Partners or the consent or approval of
any other Partners. Any such successor General Partner shall carry on the business and affairs 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 of such Person as a General Partner. Upon any such Transfer, the transferee shall
become the successor General Partner for all purposes herein, and shall be vested with the powers
and rights of the transferor General Partner, and shall be liable for all obligations and
responsible for all duties of the General Partner. Concurrently with, and as evidence of, the
admission of a successor General Partner, the General Partner shall amend Exhibit A and the books
and records of the Partnership to reflect the name, address and number and classes and/or series of
Partnership Units of such successor General Partner.

          Section 12.2 Admission of Additional Limited Partners.

A. After the admission to the Partnership of the Original Limited Partners, a Person (other than an
existing Partner) who makes a Capital Contribution to the Partnership in exchange for Partnership
Units and in accordance with this Agreement or is issued LTIP Units in exchange for no
consideration in accordance with Section 4.2.B hereof shall be admitted to the Partnership as an
Additional Limited Partner only upon furnishing to the General Partner (i) evidence of acceptance,
in form and substance satisfactory to the General Partner, of all of the terms and conditions of
this Agreement, including, without limitation, the power of attorney granted in Section 2.4 hereof,
(ii) a counterpart signature page to this Agreement executed by such Person and (iii) such other
documents or instruments as may be required in the sole and absolute discretion of the General
Partner in order to effect such Person’s admission as an Additional Limited Partner. Concurrently
with, and as evidence of, the admission of an Additional Limited Partner, the General Partner shall
amend Exhibit A and the books and records of the Partnership to reflect the name, address
and number and classes and/or series of Partnership Units of such Additional Limited Partner.

B. Notwithstanding anything to the contrary in this Section 12.2, no Person shall be admitted as an
Additional Limited Partner without the Consent of the General Partner. The admission of any Person
as an Additional Limited Partner shall become effective on the date upon which the name of such
Person is recorded on the books and records of the Partnership, following the Consent of the
General Partner to such admission and the satisfaction of all the conditions set forth in Section
12.2.A.

65

 

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

D. Any Additional Limited Partner admitted to the Partnership that is an Affiliate of the General
Partner shall be deemed to be a “General Partner Affiliate” hereunder and shall be reflected as
such on Exhibit A and the books and records of the Partnership.

          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.

          Section 12.4 Limit on Number of Partners. Unless otherwise permitted by the General Partner in its sole and absolute discretion, no
Person shall be admitted to the Partnership as an Additional Limited Partner if the effect of such
admission would be to cause the Partnership to have a number of Partners that would cause the
Partnership to become a reporting company under the Exchange Act.

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

ARTICLE 13

DISSOLUTION, LIQUIDATION AND TERMINATION

          Section 13.1 Dissolution. The Partnership shall not be dissolved by the admission of Substituted Limited Partners or
Additional Limited Partners or by the admission of a successor General Partner in accordance with
the terms of this Agreement. Upon the withdrawal of the General Partner, any successor General
Partner shall continue the business and affairs of the Partnership without dissolution. However,
the Partnership shall dissolve, and its affairs shall be wound up, upon the first to occur of any
of the following (each a “Liquidating Event”):

66

 

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

B. an election to dissolve the Partnership made by the General Partner in its sole and absolute
discretion, with or without the Consent of the Partners;

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

D. any sale or other disposition of (other than the attachment of a lien or security interest in)
all or substantially all of the assets of the Partnership outside the ordinary course of the
Partnership’s business or a related series of transactions that, taken together, result in the sale
or other disposition of (other than the attachment of a lien or security interest in)all or
substantially all of the assets of the Partnership outside the ordinary course of the Partnership’s
business; or

E. the Redemption or other acquisition by the Partnership or the General Partner of all Partnership
Units other than Partnership Units held by the 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 the Holders. After the occurrence of a Liquidating Event, no Holder
shall take any action that is inconsistent with, or not necessary to or appropriate for, the
winding up of the Partnership’s business and affairs. The General Partner (or, in the event that
there is no remaining General Partner or the General Partner has dissolved, become bankrupt within
the meaning of the Act or ceased to operate, any Person elected by a Majority in Interest of the
Partners (the General Partner or such other Person being referred to herein as the “Liquidator”))
shall be responsible for overseeing the winding up and dissolution of the Partnership and shall
take full account of the Partnership’s liabilities and property, and the Partnership property shall
be liquidated as promptly as is consistent with obtaining the fair value thereof, and the proceeds
therefrom (which may, to the extent determined by the General Partner, include shares of stock in
the General Partner) shall be applied and distributed in the following order:

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

67

 

	(3)	 	Third, to the satisfaction of all of the Partnership’s debts and liabilities to the other
Holders (whether by payment or the making of reasonable provision for payment thereof); and
	 
	(4)	 	Fourth, to the Partners in accordance with their positive Capital Account balances,
determined after taking into account all Capital Account adjustments for all prior periods and the Partnership taxable year during which the liquidation occurs (other than those made
as a result of the liquidating distribution set forth in this Section 13.2.A(4)).

The General Partner shall not receive any additional compensation for any services performed
pursuant to this Article 13 other than reimbursement of its expenses as set forth in Section 7.4.

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

C. If any Holder has a deficit balance in its Capital Account (after giving effect to all
contributions, distributions and allocations for all taxable years, including the year during which
such liquidation occurs), except as otherwise agreed to by such Holder, such Holder shall have no
obligation to make any contribution to the capital of the Partnership with respect to such deficit,
and such deficit shall not be considered a debt owed to the Partnership or to any other Person for
any purpose whatsoever.

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

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

68

 

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

          Section 13.3 Deemed Contribution and Distribution. Notwithstanding any other provision of this Article 13, in the event that the Partnership
is liquidated within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g), but no Liquidating
Event has occurred, the Partnership’s Property shall not be liquidated, the Partnership’s
liabilities shall not be paid or discharged and the Partnership’s affairs shall not be wound up.
Instead, for federal income tax purposes the Partnership shall be deemed to have contributed all of
its assets and liabilities to a new partnership in exchange for an interest in the new partnership;
and immediately thereafter, distributed Partnership Units to the Partners in the new partnership in
accordance with their respective Capital Accounts in liquidation of the Partnership, and the new
partnership is deemed to continue the business of the Partnership. Nothing in this Section 13.3
shall be deemed to have constituted a Transfer to an Assignee as a Substituted Limited Partner
without compliance with the provisions of Section 11.4 or Section 13.3 hereof.

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

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

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

          Section 13.7 Reasonable Time for Winding-Up. A reasonable time shall be allowed for the orderly winding-up of the business and affairs
of the Partnership and the liquidation of its assets pursuant to Section 13.2 hereof, in order to
minimize any losses otherwise attendant upon such winding-up, and the provisions of this Agreement shall remain in effect between and among

69

 

the Partners during the period of liquidation; provided, however, reasonable efforts shall be made to complete such winding-up within
twenty-four (24) months after the adoption of a plan of liquidation of the General Partner, as
provided in Section 562(b)(2)(B) of the Code, if necessary, in the sole and absolute discretion of
the General Partner.

ARTICLE 14

PROCEDURES FOR ACTIONS AND CONSENTS

OF PARTNERS; AMENDMENTS; MEETINGS

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

          Section 14.2 Amendments. Amendments to this Agreement may be proposed by the General Partner or by Limited Partners
holding twenty-five percent (25%) or more of the Partnership Interests held by Limited Partners
and, except as set forth in Section 7.3.C and subject to Section 7.3.D, Section 16.11 and the
rights of any Holder of any Partnership Interest set forth in a Partnership Unit Designation, shall
be approved by the Consent of the Partners. Following such proposal, the General Partner shall
submit to the Partners entitled to vote thereon any proposed amendment that, pursuant to the terms
of this Agreement, requires the consent, approval or vote of such Partners. The General Partner
shall seek the consent, approval or vote of the Partners entitled to vote thereon on any such
proposed amendment in accordance with Section 14.3 hereof.

          Section 14.3 Actions and Consents of the Partners.

A. Meetings of the Partners may be called only by the General Partner to transact any business that
the General Partner determines. The call shall state the nature of the business to be transacted.
Notice of any such meeting shall be given to all Partners entitled to act at the meeting not less
than seven (7) days nor more than sixty (60) days prior to the date of such meeting. Partners may
vote in person or by proxy at such meeting. Unless approval by a different number or proportion of
the Partners is required by this Agreement, the affirmative vote of Partners holding a majority of
the Percentage Interests held by the Partners entitled to act on any proposal shall be sufficient
to approve such proposal at a meeting of the Partners. Whenever the vote, consent or approval of
Partners is permitted or required under this Agreement, such vote, consent or approval may be given
at a meeting of Partners or may be given at a meeting of Partners or in accordance with the
procedure prescribed in Section 14.3.B hereof.

B. Any action requiring the Consent of any Partner or group of Partners pursuant to this Agreement
or that is required or permitted to be taken at a meeting of the Partners may be taken without a
meeting if a consent in writing or by electronic transmission setting forth the action so taken or
consented to is given by Partners whose affirmative vote would be sufficient to approve such action
or provide such Consent at a meeting of the Partners. Such consent may be in one instrument or in
several instruments, and shall have the same force and effect as the affirmative vote of such Partners at a meeting of the Partners. Such consent shall be filed with the General
Partner. An action so taken shall be deemed to have been taken at a meeting held on the effective
date so certified. For purposes of obtaining a Consent in writing or by electronic transmission,

70

 

the General Partner may require a response within a reasonable specified time, but not less than
fifteen (15) days, and failure to respond in such time period shall constitute a Consent that is
consistent with the General Partner’s recommendation with respect to the proposal; provided,
however, that an action shall become effective at such time as requisite Consents are received even
if prior to such specified time.

C. Each Partner entitled to act at a meeting of the Partners may authorize any Person or Persons to
act for it by proxy on all matters in which a Partner is entitled to participate, including waiving
notice of any meeting, or voting or participating at a meeting. Each proxy must be signed by the
Partner or its attorney-in-fact. No proxy shall be valid after the expiration of eleven (11) months
from the date thereof unless otherwise provided in the proxy (or there is receipt of a proxy
authorizing a later date). Every proxy shall be revocable at the pleasure of the Partner executing
it, such revocation to be effective upon the Partnership’s receipt of written notice of such
revocation from the Partner executing such proxy, unless such proxy states that it is irrevocable
and is coupled with an interest.

D. The General Partner may set, in advance, a record date for the purpose of determining the
Partners (i) entitled to Consent to any action, (ii) entitled to receive notice of or vote at any
meeting of the Partners or (iii) in order to make a determination of Partners for any other proper
purpose. Such date, in any case, shall not be prior to the close of business on the day the record
date is fixed and shall be not more than ninety (90) days and, in the case of a meeting of the
Partners, not less than five (5) days, before the date on which the meeting is to be held. If no
record date is fixed, the record date for the determination of Partners entitled to notice of or to
vote at a meeting of the Partners shall be at the close of business on the day on which the notice
of the meeting is sent, and the record date for any other determination of Partners shall be the
effective date of such Partner action, distribution or other event. When a determination of the
Partners entitled to vote at any meeting of the Partners has been made as provided in this section,
such determination shall apply to any adjournment thereof.

E. Each meeting of Partners shall be conducted by the General Partner or such other Person as the
General Partner may appoint pursuant to such rules for the conduct of the meeting as the General
Partner or such other Person deems appropriate in its sole and absolute discretion. Without
limitation, meetings of Partners may be conducted in the same manner as meetings of the General
Partner’s stockholders and may be held at the same time as, and as part of, the meetings of the
General Partner’s stockholders.

ARTICLE 15

GENERAL PROVISIONS

          Section 15.1 Redemption Rights of Qualifying Parties.

A. After the applicable Fourteen-Month Period, a Qualifying Party shall have the right (subject to
the terms and conditions set forth herein) to require the Partnership to redeem all or a portion of
the Partnership Common Units held by such Tendering Party (Partnership Common Units that have in fact been tendered for redemption being hereafter referred to as “Tendered
Units”) in exchange (a “Redemption”) for the Cash Amount payable on the Specified Redemption Date.
The Partnership may, in the General Partner’s sole and absolute discretion,

71

 

redeem Tendered Units at the request of the Holder thereof prior to the end of the applicable Fourteen-Month Period
(subject to the terms and conditions set forth herein) (a “Special Redemption”); provided, however,
that the General Partner first receives a legal opinion to the same effect as the legal opinion
described in Section 15.1.G(4) of this Agreement. Any Redemption shall be exercised pursuant to a
Notice of Redemption delivered to the General Partner by the Qualifying Party when exercising the
Redemption right (the “Tendering Party”). The Partnership’s obligation to effect a Redemption,
however, shall not arise or be binding against the Partnership until the earlier of (i) the date
the General Partner notifies the Tendering Party that the General Partner declines to acquire some
or all of the Tendered Units under Section 15.1.B hereof following receipt of a Notice of
Redemption and (ii) the Business Day following the Cut-Off Date. In the event of a Redemption, the
Cash Amount shall be delivered as a certified or bank check payable to the Tendering Party or, in
the General Partner’s sole and absolute discretion, in immediately available funds, in each case,
on or before the tenth (10th) Business Day following the date on which the General Partner receives
a Notice of Redemption from the Tendering Party.

B. Notwithstanding the provisions of Section 15.1.A hereof, on or before the close of business on
the Cut-Off Date, the General Partner may, in the General Partner’s sole and absolute discretion
but subject to the Ownership Limit, elect to acquire some or all (such percentage being referred to
as the “Applicable Percentage”) of the Tendered Units from the Tendering Party in exchange for REIT
Shares. If the General Partner elects to acquire some or all of the Tendered Units pursuant to this
Section 15.1.B, the General Partner shall give written notice thereof to the Tendering Party on or
before the close of business on the Cut-Off Date. If the General Partner elects to acquire any of
the Tendered Units for REIT Shares, the General Partner shall issue and deliver such REIT Shares to
the Tendering Party pursuant to the terms of this Section 15.1.B, in which case (1) the General
Partner shall assume directly the obligation with respect thereto and shall satisfy the Tendering
Party’s exercise of its Redemption right with respect to such Tendered Units and (2) such
transaction shall be treated, for federal income tax purposes, as a transfer by the Tendering Party
of such Tendered Units to the General Partner in exchange for the REIT Shares Amount. If the
General Partner so elects, on the Specified Redemption Date, the Tendering Party shall sell such
number of the Tendered Units to the General Partner in exchange for a number of REIT Shares equal
to the product of the REIT Shares Amount and the Applicable Percentage. The Tendering Party shall
submit (i) such information, certification or affidavit as the General Partner may reasonably
require in connection with the application of the Ownership Limit to any such acquisition and (ii)
such written representations, investment letters, legal opinions or other instruments necessary, in
the General Partner’s view, to effect compliance with the Securities Act. In the event of a
purchase of the Tendered Units by the General Partner pursuant to this Section 15.1.B, the
Tendering Party shall no longer have the right to cause the Partnership to effect a Redemption of
such Tendered Units and, upon notice to the Tendering Party by the General Partner given on or
before the close of business on the Cut-Off Date that the General Partner has elected to acquire
some or all of the Tendered Units pursuant to this Section 15.1.B, the obligation of the
Partnership to effect a Redemption of the Tendered Units as to which the General Partner’s notice
relates shall not accrue or arise. A number of REIT Shares equal to the product of the Applicable
Percentage and the REIT Shares Amount, if applicable, shall be delivered by the General Partner as duly authorized, validly issued, fully paid and
non-assessable REIT Shares and, if applicable, Rights, free of any pledge, lien, encumbrance or
restriction, other than the Ownership Limit, the Securities Act and relevant state securities or

72

 

“blue sky” laws. Neither any Tendering Party whose Tendered Units are acquired by the General
Partner pursuant to this Section 15.1.B, any Partner, any Assignee nor any other interested Person
shall have any right to require or cause the General Partner to register, qualify or list any REIT
Shares owned or held by such Person, whether or not such REIT Shares are issued pursuant to this
Section 15.1.B, with the SEC, with any state securities commissioner, department or agency, under
the Securities Act or the Exchange Act or with any stock exchange; provided, however, that this
limitation shall not be in derogation of any registration or similar rights granted pursuant to any
other written agreement between the General Partner and any such Person. Notwithstanding any delay
in such delivery, the Tendering Party shall be deemed the owner of such REIT Shares and Rights for
all purposes, including, without limitation, rights to vote or consent, receive dividends, and
exercise rights, as of the Specified Redemption Date. REIT Shares issued upon an acquisition of the
Tendered Units by the General Partner pursuant to this Section 15.1.B may contain such legends
regarding restrictions under the Securities Act and applicable state securities laws as the General
Partner determines to be necessary or advisable in order to ensure compliance with such laws.

C. Notwithstanding the provisions of Section 15.1.A and 15.1.B hereof, the Tendering Parties shall
have no rights under this Agreement that would otherwise be prohibited by the Charter and shall
have no rights to require the Partnership to redeem Common Units if the acquisition of such Common
Units by the General Partner pursuant to Section 15.1.B hereof would cause any Person to violate
the Ownership Limit. To the extent that any attempted Redemption or acquisition of the Tendered
Units by the General Partner pursuant to Section 15.1.B hereof would be in violation of this
Section 15.1.C, it shall be null and void ab initio, and the Tendering Party shall not acquire any
rights or economic interests in REIT Shares otherwise issuable by the General Partner under Section
15.1.B hereof or cash otherwise payable under Section 15.1.A hereof.

D. If the General Partner does not elect to acquire the Tendered Units pursuant to Section 15.1.B
hereof:

	(1)	 	The Partnership may elect to raise funds for the payment of the Cash Amount either (a) by
requiring that the General Partner contribute to the Partnership funds from the proceeds of a
registered public offering by the General Partner of REIT Shares sufficient to purchase the
Tendered Units or (b) from any other sources (including, but not limited to, the sale of any
Property and the incurrence of additional Debt) available to the Partnership. The General
Partner shall make a Capital Contribution of any such amounts to the Partnership for an
additional General Partner Interest. Any such contribution shall entitle the General Partner
to an equitable Percentage Interest adjustment.
	 
	(2)	 	If the Cash Amount is not paid on or before the Specified Redemption Date, interest shall
accrue with respect to the Cash Amount from the day after the Specified Redemption Date to and
including the date on which the Cash Amount is paid at a rate equal to the base rate on
corporate loans at large United States money center commercial banks, as published from time to time in the Wall Street Journal (but not higher than the maximum
lawful rate).

73

 

E. Notwithstanding the provisions of Section 15.1.B hereof, the General Partner shall not, under
any circumstances, elect to acquire any Tendered Units in exchange for REIT Shares if such exchange
would be prohibited under the Charter.

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

	(1)	 	All Partnership Common Units acquired by the General Partner pursuant to Section 15.1.B
hereof shall automatically, and without further action required, be converted into and deemed
to be a General Partner Interest comprised of the same number of Partnership Common Units.
	 
	(2)	 	Subject to the Ownership Limit, no Tendering Party may effect a Redemption for less than one
thousand (1,000) Partnership Common Units or, if such Tendering Party holds (as a Limited
Partner or, economically, as an Assignee) less than one thousand (1,000) Partnership Common
Units, all of the Partnership Common Units held by such Tendering Party, without, in each
case, the Consent of the General Partner.
	 
	(3)	 	If (i) a Tendering Party surrenders its Tendered Units during the period after the
Partnership Record Date with respect to a distribution and before the record date established
by the General Partner for a distribution to its stockholders of some or all of its portion of
such Partnership distribution, and (ii) the General Partner elects to acquire any of such
Tendered Units in exchange for REIT Shares pursuant to Section 15.1.B, such Tendering Party
shall pay to the General Partner on the Specified Redemption Date an amount in cash equal to
the portion of the Partnership distribution in respect of the Tendered Units exchanged for
REIT Shares, insofar as such distribution relates to the same period for which such Tendering
Party would receive a distribution in respect of such REIT Shares.
	 
	(4)	 	The consummation of such Redemption (or an acquisition of Tendered Units by the General
Partner pursuant to Section 15.1.B hereof, as the case may be) shall be subject to the
expiration or termination of the applicable waiting period, if any, under the
Hart-Scott-Rodino Act.
	 
	(5)	 	The Tendering Party shall continue to own (subject, in the case of an Assignee, to the
provisions of Section 11.5 hereof) all Partnership Common Units subject to any Redemption, and
be treated as a Limited Partner or an Assignee, as applicable, with respect to such
Partnership Common Units for all purposes of this Agreement, until such Partnership Common
Units are either paid for by the Partnership pursuant to Section 15.1.A hereof or transferred
to the General Partner and paid for, by the issuance of the REIT Shares, pursuant to Section
15.1.B hereof on the Specified Redemption Date. Until a Specified Redemption Date and an
acquisition of the Tendered Units by the General Partner pursuant to Section 15.1.B hereof, the Tendering Party shall have no rights as a
stockholder of the General Partner with respect to the REIT Shares issuable in connection
with such acquisition.

74

 

G. In connection with an exercise of Redemption rights pursuant to this Section 15.1, except as
otherwise Consented to by the General Partner, the Tendering Party shall submit the following to
the General Partner, in addition to the Notice of Redemption:

	(1)	 	A written affidavit, dated the same date as the Notice of Redemption, (a) disclosing the
actual and constructive ownership, as determined for purposes of Code Sections 856(a)(6) and
856(h), of REIT Shares by (i) such Tendering Party and (ii) to the best of their knowledge any
Related Party and (b) representing that, after giving effect to the Redemption or an
acquisition of the Tendered Units by the General Partner pursuant to Section 15.1.B hereof,
neither the Tendering Party nor to the best of their knowledge any Related Party will own REIT
Shares in violation of the Ownership Limit;
	 
	(2)	 	A written representation that neither the Tendering Party nor to the best of their knowledge
any Related Party has any intention to acquire any additional REIT Shares prior to the closing
of the Redemption or an acquisition of the Tendered Units by the General Partner pursuant to
Section 15.1.B hereof on the Specified Redemption Date; and

H. LTIP Unit Exception and Redemption of Partnership Common Units Issued Upon Conversion of LTIP
Units. Holders of LTIP Units shall not be entitled to the right of Redemption provided for in
Section 15.1 of this Agreement, unless and until such LTIP Units have been converted into
Partnership Common Units (or any other class or series of Partnership Common Units entitled to such
right of Redemption) in accordance with their terms.

          Section 15.2 Addresses and Notice. Any notice, demand, request or report required or permitted to be given or made to a
Partner or Assignee under this Agreement shall be in writing and shall be deemed given or made when
delivered in person or when sent by first class United States mail or by other means of written or
electronic communication (including by telecopy, facsimile, electronic mail or commercial courier
service) to the Partner, or Assignee at the address set forth in Exhibit A or Exhibit
B (as applicable) or such other address of which the Partner shall notify the General Partner
in accordance with this Section 15.2.

          Section 15.3 Titles and Captions. All article or section titles or captions in this Agreement are for convenience only. They
shall not be deemed part of this Agreement and in no way define, limit, extend or describe the
scope or intent of any provisions hereof. Except as specifically provided otherwise, references to
“Articles” or “Sections” are to Articles and Sections of this Agreement.

          Section 15.4 Pronouns and Plurals. Whenever the context may require, any pronouns used in this Agreement shall include the
corresponding masculine, feminine or neuter forms, and the singular form of nouns, pronouns and
verbs shall include the plural and vice versa.

          Section 15.5 Further Action. The parties shall execute and deliver all documents, provide all information and take or
refrain from taking action as may be necessary or appropriate to achieve the purposes of this
Agreement.

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

75

 

          Section 15.7 Waiver.

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

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

          Section 15.8 Counterparts. This Agreement may be executed in counterparts, all of which together shall constitute one
agreement binding on all the parties hereto, notwithstanding that all such parties are not
signatories to the original or the same counterpart. Each party shall become bound by this
Agreement immediately upon affixing its signature hereto.

          Section 15.9 Applicable Law; Consent to Jurisdiction; Waiver of Jury Trial.

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

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

76

 

(iv) irrevocably waives any and all right to trial by jury in any legal proceeding arising out of or
related to this Agreement or the transactions contemplated hereby.

          Section 15.10 Entire Agreement. This Agreement contains all of the understandings and agreements between and among the
Partners with respect to the subject matter of this Agreement and the rights, interests and
obligations of the Partners with respect to the Partnership. Notwithstanding the immediately
preceding sentence, the Partners hereby acknowledge and agree that the General Partner, without the
approval of any Limited Partner, may enter into side letters or similar written agreements with
Limited Partners that are not Affiliates of the General Partner, executed contemporaneously with
the admission of such Limited Partner to the Partnership, affecting the terms hereof, as negotiated
with such Limited Partner and which the General Partner in its sole discretion deems necessary,
desirable or appropriate. The parties hereto agree that any terms, conditions or provisions
contained in such side letters or similar written agreements with a Limited Partner shall govern
with respect to such Limited Partner notwithstanding the provisions of this Agreement.

          Section 15.11 Invalidity of Provisions. If any provision of this Agreement is or becomes invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions contained herein
shall not be affected thereby.

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

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

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

77

 

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

          Section 15.13 No Partition. No Partner nor any successor-in-interest to a Partner shall have the right while this
Agreement remains in effect to have any property of the Partnership partitioned, or to file a
complaint or institute any proceeding at law or in equity to have such property of the Partnership
partitioned, and each Partner, on behalf of itself and its successors and assigns hereby waives any
such right. It is the intention of the Partners that the rights of the parties hereto and their
successors-in-interest to Partnership property, as among themselves, shall be governed by the terms
of this Agreement, and that the rights of the Partners and their respective successors-in-interest
shall be subject to the limitations and restrictions as set forth in this Agreement.

          Section 15.14 No Third-Party Rights Created Hereby. The provisions of this Agreement are solely for the purpose of defining the interests of
the Holders, inter se; and no other person, firm or entity (i.e., a party who is not a signatory
hereto or a permitted successor to such signatory hereto) shall have any right, power, title or
interest by way of subrogation or otherwise, in and to the rights, powers, title and provisions of
this Agreement. No creditor or other third party having dealings with the Partnership shall have
the right to enforce the right or obligation of any Partner to make Capital Contributions or loans
to the Partnership or to pursue any other right or remedy hereunder or at law or in equity. None of
the rights or obligations of the Partners herein set forth to make Capital Contributions or loans
to the Partnership shall be deemed an asset of the Partnership for any purpose by any creditor or
other third party, nor may any such rights or obligations be sold, transferred or assigned by the
Partnership or pledged or encumbered by the Partnership to secure any debt or other obligation of
the Partnership or any of the Partners.

          Section 15.15 No Rights as Stockholders. Nothing contained in this Agreement shall be construed as conferring upon the Holders of
Partnership Units any rights whatsoever as stockholders of the General Partner, including without
limitation any right to receive dividends or other distributions made to stockholders of the
General Partner or to vote or to consent or receive notice as stockholders in respect of any
meeting of stockholders for the election of directors of the General Partner or any other matter.

78

 

ARTICLE 16

LTIP UNITS

          Section 16.1 Designation. A class of Partnership Units in the Partnership designated as the “LTIP Units” is hereby
established. The number of LTIP Units that may be issued is not limited by this Agreement.

          Section 16.2 Vesting.

A. Vesting, Generally. LTIP Units may, in the sole discretion of the General Partner, be issued
subject to vesting, forfeiture and additional restrictions on Transfer pursuant to the terms of a
an award, vesting or other similar agreement (a “Vesting Agreement”). The terms of any Vesting
Agreement may be modified by the General Partner from time to time in its sole discretion, subject
to any restrictions on amendment imposed by the relevant Vesting Agreement or by the Plan, if
applicable. LTIP Units that were fully vested when issued or that have vested and are no longer
subject to forfeiture under the terms of a Vesting Agreement are referred to as “Vested LTIP
Units”; all other LTIP Units shall be treated as “Unvested LTIP Units.”

B. Forfeiture. Unless otherwise specified in the Vesting Agreement, the Plan or in any applicable
Equity Plan or Stock Option Plan or other compensatory arrangement or incentive program pursuant to
which LTIP Units are issued, upon the occurrence of any event specified in such Vesting Agreement,
Plan, Equity Plan, Stock Option Plan, arrangement or program as resulting in either the right of
the Partnership or the General Partner to repurchase LTIP Units at a specified purchase price or
some other forfeiture of any LTIP Units, then if the Partnership or
the General Partner exercises such right to repurchase or upon the occurrence of the event causing
forfeiture in accordance with the applicable Vesting Agreement, Plan, Equity Plan, Equity Plan,
Stock Option Plan, arrangement or program, then the relevant LTIP Units shall immediately, and
without any further action, be treated as cancelled and no longer outstanding for any purpose.
Unless otherwise specified in the applicable Vesting Agreement, Plan, Stock Option Plan,
arrangement or program, no consideration or other payment shall be due with respect to any LTIP
Units that have been forfeited, other than any distributions declared with respect to a Partnership
Record Date and with respect to such units prior to the effective date of the forfeiture. Except
as otherwise provided in this Agreement (including without limitation Section 6.4A(ix)) or any
agreement relating to the grant of LTIP Units, including any Vesting Agreement, in connection with
any repurchase or forfeiture of such units, the balance of the portion of the Capital Account of
the Holder of LTIP Units that is attributable to all of his or her LTIP Units shall be reduced by
the amount, if any, by which it exceeds the target balance contemplated by Section 6.2.D,
calculated with respect to such Holder’s remaining LTIP Units, if any.

          Section 16.3 Adjustments. The Partnership shall maintain at all times a one-to-one correspondence between LTIP Units
and Partnership Common Units for conversion, distribution and other purposes, including without
limitation complying with the following procedures; provided, that the foregoing is not intended to
alter the special allocations pursuant to Section 6.2.D, differences between distributions to be
made with respect to LTIP Units and Partnership Common Units pursuant to Section 13.2 and Section
16.4.B hereof in the event that the Capital Accounts attributable to the LTIP Units are less than
those attributable to Partnership Common

79

 

Units due to insufficient special allocation pursuant to
Section 6.2.D or related provisions. If an Adjustment Event occurs, then the General Partner shall
take any action reasonably necessary, including any amendment to this Agreement or Exhibit A hereto
adjusting the number of outstanding LTIP Units or subdividing or combining outstanding LTIP Units,
to maintain a one-for-one conversion and economic equivalence ratio between Partnership Common
Units and LTIP Units. The following shall be “Adjustment Events”: (i) the Partnership makes a
distribution on all outstanding Partnership Common Units in Partnership Units, (ii) the Partnership
subdivides the outstanding Partnership Common Units into a greater number of units or combines the
outstanding Partnership Common Units into a smaller number of units, or (iii) the Partnership
issues any Partnership Units in exchange for its outstanding Partnership Common Units by way of a
reclassification or recapitalization of its Partnership Common Units. If more than one Adjustment
Event occurs, any adjustment to the LTIP Units need be made only once using a single formula that
takes into account each and every Adjustment Event as if all Adjustment Events occurred
simultaneously. For the avoidance of doubt, the following shall not be Adjustment Events: (x) the
issuance of Partnership Units in a financing, reorganization, acquisition or other similar business
transaction, (y) the issuance of Partnership Units pursuant to any employee benefit or compensation
plan or distribution reinvestment plan, or (z) the issuance of any Partnership Units to the General
Partner in respect of a Capital Contribution to the Partnership of proceeds from the sale of
securities by the General Partner. If the Partnership takes an action affecting the Partnership
Common Units other than actions specifically described above as “Adjustment Events” and in the
opinion of the General Partner such action would require an action to maintain the one-to-one
correspondence described above, the General Partner shall have the right to take such action, to the extent permitted by law, the Plan and
by any applicable Equity Plan or Stock Option Plan or other compensatory arrangement or incentive
program pursuant to which LTIP Units are issued, in such manner and at such time as the General
Partner, in its sole discretion, may determine to be reasonably appropriate under the
circumstances. If an amendment is made to this Agreement adjusting the number of outstanding LTIP
Units as herein provided, the Partnership shall promptly file in the books and records of the
Partnership an officer’s certificate setting forth a brief statement of the facts requiring such
adjustment, which certificate shall be conclusive evidence of the correctness of such adjustment
absent manifest error. Promptly after filing of such certificate, the Partnership shall mail a
notice to each Holder of LTIP Units setting forth the adjustment to his or her LTIP Units and the
effective date of such adjustment.

          Section 16.4 Distributions.

A. Operating Distributions. Except as otherwise provided in this Agreement, the Plan, or any other
applicable Equity Plan or Stock Option Plan, any applicable Vesting Agreement or by the General
Partner with respect to any particular class or series of LTIP Units, Holders of LTIP Units shall
be entitled to receive, if, when and as authorized by the General Partner out of funds or other
property legally available for the payment of distributions, regular, special, extraordinary or
other distributions (other than distributions upon the occurrence of a Liquidating Event or
proceeds from a Terminating Capital Transaction) which may be made from time to time, in an amount
per unit equal to the amount of any such distributions that would have been payable to such holders
if the LTIP Units had been Partnership Common Units (if applicable, assuming such LTIP Units were
held for the entire period to which such distributions relate).

80

 

B. Liquidating Distributions. Holders of LTIP Units shall also be entitled to receive, if, when and
as authorized by the General Partner out of funds or other property legally available for the
payment of distributions, distributions upon the occurrence of a Liquidating Event or representing
proceeds from a Terminating Capital Transaction in an amount per LTIP Unit equal to the amount of
any such distributions payable on one Partnership Common Unit, whether made prior to, on or after
the LTIP Unit Distribution Payment Date, provided that the amount of such distributions shall not
exceed the positive balances of the Capital Accounts of the holders of such LTIP Units to the
extent attributable to the ownership of such LTIP Units.

C. Distributions Generally. Distributions on the LTIP Units, if authorized, shall be payable on
such dates and in such manner as may be authorized by the General Partner (any such date, a “LTIP
Unit Distribution Payment Date”); provided that the LTIP Unit Distribution Payment Date shall be
the same as the corresponding date relating to the corresponding distribution on the Partnership
Common Units. The record date for determining which Holders of LTIP Units are entitled to receive
a distributions shall be the Partnership Record Date.

          Section 16.5 Allocations. Holders of LTIP Units shall be allocated Net Income and Net Loss in amounts per LTIP Unit
equal to the amounts allocated per Partnership Common Unit. The allocations provided by
the preceding sentence shall be subject to Sections 6.2.A and 6.2.B and in addition to any
special allocations required by Section 6.2.D. The General Partner is authorized in its discretion
to delay or accelerate the participation of the LTIP Units in allocations of Net Income and Net
Loss under this Section 16.5, or to adjust the allocations made under this Section 16.5, so that
the ratio of (i) the total amount of Net Income or Net Loss allocated with respect to each LTIP
Unit in the taxable year in which that LTIP Unit’s LTIP Unit Distribution Payment Date falls
(excluding special allocations under Section 6.2.D), to (ii) the total amount distributed to that
LTIP Unit with respect to such period, is more nearly equal to the ratio of (i) the Net Income and
Net Loss allocated with respect to the General Partner’s Partnership Common Units in such taxable
year to (ii) the amounts distributed to the General Partner with respect to such Partnership Common
Units and such taxable year.

          Section 16.6 Transfers. Subject to the terms of any Vesting Agreement, a Holder of LTIP Units shall be entitled to
transfer his or her LTIP Units to the same extent, and subject to the same restrictions as Holders
of Partnership Common Units are entitled to transfer their Partnership Common Units pursuant to
Article 11.

          Section 16.7 Redemption. The Redemption Right provided to Qualifying Parties under Section 15.1 shall not apply with
respect to LTIP Units unless and until they are converted to Partnership Common Units as provided
in Section 15.1.H and Section 16.9 below.

          Section 16.8 Legend. Any certificate evidencing an LTIP Unit shall bear an appropriate legend indicating that
additional terms, conditions and restrictions on transfer, including without limitation any Vesting
Agreement, apply to the LTIP Unit.

Section 16.9 Conversion to Partnership Common Units.

A. A Qualifying Party holding LTIP Units shall have the right (the “Conversion Right”), at his or
her option, at any time to convert all or a portion of his or her Vested LTIP Units into

81

 

Partnership Common Units; provided, however, that a Qualifying Party may not exercise the
Conversion Right for less than one thousand (1,000) Vested LTIP Units or, if such Qualifying Party
holds less than one thousand (1,000) Vested LTIP Units, all of the Vested LTIP Units held by such
Qualifying Party. Qualifying Parties shall not have the right to convert Unvested LTIP Units into
Partnership Common Units until they become Vested LTIP Units; provided, however, that when a
Qualifying Party is notified of the expected occurrence of an event that will cause his or her
Unvested LTIP Units to become Vested LTIP Units, such Qualifying Party may give the Partnership a
Conversion Notice conditioned upon and effective as of the time of vesting and such Conversion
Notice, unless subsequently revoked by the Qualifying Party, shall be accepted by the Partnership
subject to such condition. In all cases, the conversion of any LTIP Units into
Partnership Common Units shall be subject to the conditions and procedures set forth in this
Section 16.9.

B. A Qualifying Party may convert his or her Vested LTIP Units into an equal number of fully paid
and non-assessable Partnership Common Units, giving effect to all adjustments (if any) made
pursuant to Section 16.3. Notwithstanding the foregoing, in no event may a Qualifying Party
convert a number of Vested LTIP Units that exceeds (x) the Economic Capital Account Balance of such
Limited Partner, to the extent attributable to his or her ownership of LTIP Units, divided by (y)
the Common Unit Economic Balance, in each case as determined as of the effective date of conversion
(the “Capital Account Limitation”). In order to exercise his or her Conversion Right, a Qualifying
Party shall deliver a notice (a “Conversion Notice”) in the form attached as Exhibit D to the
Partnership (with a copy to the General Partner) not less than 3 nor more than 10 days prior to a
date (the “Conversion Date”) specified in such Conversion Notice; provided, however, that if the
General Partner has not given to the Qualifying Party notice of a proposed or upcoming Transaction
(as defined below) at least thirty (30) days prior to the effective date of such Transaction, then
the Qualifying Party shall have the right to deliver a Conversion Notice until the earlier of (x)
the tenth (10th) day after such notice from the General Partner of a Transaction or (y) the third
business day immediately preceding the effective date of such Transaction. A Conversion Notice
shall be provided in the manner provided in Section 15.2. Each Qualifying Party seeking to convert
Vested LTIP Units covenants and agrees with the Partnership that all Vested LTIP Units to be
converted pursuant to this Section 16.9 shall be free and clear of all liens. Notwithstanding
anything herein to the contrary, a Qualifying Party may deliver a Notice of Redemption pursuant to
Section 15.1.A relating to those Partnership Common Units into which such LTIP Units are
convertible into Partnership Common Units in advance of the Conversion Date; provided, however,
that the redemption of such Partnership Common Units by the Partnership shall in no event take
place until on or after the Conversion Date. For clarity, it is noted that the objective of this
paragraph is to put a Qualifying Party in a position where, if he or she so wishes, the Partnership
Common Units into which his or her Vested LTIP Units will be converted can be redeemed by the
Partnership pursuant to Section 15.1.A simultaneously with such conversion, with the further
consequence that, if the General Partner elects to assume the Partnership’s redemption obligation
with respect to such Partnership Common Units under Section 15.1.B by delivering to such holder
REIT Shares rather than cash, then such Qualifying Party can have such REIT Shares issued to him or
her simultaneously with the conversion of his or her Vested LTIP Units into Partnership Common
Units. The General Partner shall cooperate with a Qualifying Party to coordinate the timing of the
different events described in the foregoing sentence.

82

 

C. The Partnership, at any time at the election of the General Partner, may cause any number of
Vested LTIP Units to be converted (a “Forced Conversion”) into an equal number of Partnership
Common Units, giving effect to all adjustments (if any) made pursuant to Section 16.3; provided,
however, that the Partnership may not cause a Forced Conversion of any LTIP Units that would not at
the time be eligible for conversion at the option of such Qualifying Party pursuant to Section
16.9.B. In order to exercise its right of Forced Conversion, the Partnership shall deliver a
notice (a “Forced Conversion Notice”) in the form attached as hereto as Exhibit E to the applicable
LTIP Unitholder not less than 10 nor more than 60 days prior to the Conversion Date specified in
such Forced Conversion Notice. A Forced Conversion Notice shall be provided in the manner provided
in Section 15.2.

D. A conversion of Vested LTIP Units for which the Holder thereof has given a Conversion Notice or
the Partnership has given a Forced Conversion Notice shall occur automatically after the close of
business on the applicable Conversion Date without any action on the part of such LTIP Unitholder,
other than the surrender of any certificate or certificates evidencing such Vested LTIP Units, as
of which time such LTIP Unitholder shall be credited on the books and records of the Partnership as
of the opening of business on the next day with the number of Partnership Common Units into which
such LTIP Units were converted. After the conversion of LTIP Units as aforesaid, the Partnership
shall deliver to such LTIP Unitholder, upon his or her written request, a certificate of the
General Partner certifying the number of Partnership Common Units and remaining LTIP Units, if any,
held by such person immediately after such conversion. The Assignee of any Limited Partner
pursuant to Article 11 hereof may exercise the rights of such Limited Partner pursuant to this
Section 16.9 and such Limited Partner shall be bound by the exercise of such rights by the
Assignee.

E. For purposes of making future allocations under Section 6.2.D and applying the Capital Account
Limitation, the portion of the Economic Capital Account Balance of the applicable LTIP Unitholder
that is treated as attributable to his or her LTIP Units shall be reduced, as of the date of
conversion, by the product of the number of LTIP Units converted and the Common Unit Economic
Balance.

F. If the Partnership or the General Partner shall be a party to any transaction (including without
limitation a merger, consolidation, unit exchange, self tender offer for all or substantially all
Partnership Common Units or other business combination or reorganization, or sale of all or
substantially all of the Partnership’s assets, but excluding any transaction which constitutes an
Adjustment Event) in each case as a result of which Partnership Common Units shall be exchanged for
or converted into the right, or the Holders shall otherwise be entitled, to receive cash,
securities or other property or any combination thereof (each of the foregoing being referred to
herein as a “Transaction”), then the General Partner shall, immediately prior to the Transaction,
exercise its right to cause a Forced Conversion with respect to the maximum number of LTIP Units
then eligible for conversion, taking into account any allocations that occur in connection with the
Transaction or that would occur in connection with the Transaction if the assets of the Partnership
were sold at the Transaction price or, if applicable, at a value determined by the General Partner
in good faith using the value attributed to the Partnership Common Units in the context of the
Transaction (in which case the Conversion Date shall be the effective date of the Transaction). In
anticipation of such Forced Conversion and the consummation of the Transaction, the Partnership
shall use commercially reasonable efforts to

83

 

cause each LTIP Unitholder to be afforded the right to
receive in connection with such Transaction in consideration for the Partnership Common Units into
which his or her LTIP Units will be converted the same kind and amount of cash, securities and
other property (or any combination thereof) receivable upon the consummation of such Transaction by
a Holder of the same number of Partnership Common Units, assuming such Holder is not a Person with
which the Partnership consolidated or into which the Partnership merged or which merged into the
Partnership or to which such sale or transfer was made, as the case may be (a “Constituent
Person”), or an affiliate of a Constituent Person. In the event that Holders of Partnership Units
have the opportunity to elect the form or type of consideration to be received upon consummation of
the Transaction, prior to such Transaction the General Partner shall give prompt written notice to
each LTIP Unitholder of such opportunity, and shall use commercially
reasonable efforts to afford the LTIP Unitholder the right to elect, by written notice to the
General Partner, the form or type of consideration to be received upon conversion of each LTIP Unit
held by such Holder into Partnership Common Units in connection with such Transaction. If a LTIP
Unitholder fails to make such an election, such Holder (and any of its transferees) shall receive
upon conversion of each LTIP Unit held by him or her (or by any of his or her transferees) the same
kind and amount of consideration that a Holder of Partnership Common Units would receive if such
Holder of Partnership Common Units failed to make such an election. Subject to the rights of the
Partnership and the General Partner under any Vesting Agreement and the relevant terms of the Plan
or any other applicable Equity Plan or Stock Option Plan, the Partnership shall use commercially
reasonable effort to cause the terms of any Transaction to be consistent with the provisions of
this Section 16.9.F and to enter into an agreement with the successor or purchasing entity, as the
case may be, for the benefit of any LTIP Unitholder whose LTIP Units will not be converted into
Partnership Common Units in connection with the Transaction that will (i) contain provisions
enabling the Qualifying Parties that remain outstanding after such Transaction to convert their
LTIP Units into securities as comparable as reasonably possible under the circumstances to the
Partnership Common Units and (ii) preserve as far as reasonably possible under the circumstances
the distribution, special allocation, conversion, and other rights set forth in the Agreement for
the benefit of the LTIP Unitholders.

          Section 16.10 Voting. LTIP Limited Partners shall have the same voting rights as a Holder of Partnership Common
Units, with the LTIP Units voting together as a single class with the Partnership Common Units and
having one vote per LTIP Unit and Holders of LTIP Units shall not be entitled to approve, vote on
or consent to any other matter. The foregoing voting provision will not apply if, at or prior to
the time when the action with respect to which such vote would otherwise be required will be
effected, all outstanding LTIP Units shall have been converted or provision is made for such
conversion to occur as of or prior to such time into Partnership Common Units.

          Section 16.11 Section 83 Safe Harbor. Each Partner authorizes the General Partner to elect to apply the safe harbor (the “Section
83 Safe Harbor”) set forth in proposed Regulations Section 1.83-3(l) and proposed IRS Revenue
Procedure published in Notice 2005-43 (together, the “Proposed Section 83 Safe Harbor Regulation”)
(under which the fair market value of a Partnership Interest that is Transferred in connection with
the performance of services is treated as being equal to the liquidation value of the interest) if
such Proposed Section 83 Safe Harbor Regulation or similar Regulations are promulgated as a final
or temporary Regulations. If the General Partner determines that the Partnership should make such
election, the General Partner is

84

 

hereby authorized to amend this Agreement without the consent of
any other Partner to provide that (i) the Partnership is authorized and directed to elect the
Section 83 Safe Harbor, (ii) the Partnership and each of its Partners (including any Person to whom
a Partnership Interest, including an LTIP Unit, is Transferred in connection with the performance
of services) will comply with all requirements of the Section 83 Safe Harbor with respect to all
Partnership Interests Transferred in connection with the performance of services while such
election remains in effect and (iii) the Partnership and each of its Partners will take all actions
necessary, including providing the
Partnership with any required information, to permit the Partnership to comply with the
requirements set forth or referred to in the applicable Regulations for such election to be
effective until such time (if any) as the General Partner determines, in its sole discretion, that
the Partnership should terminate such election. The General Partner is further authorized to amend
this Agreement to modify Article 6 to the extent the General Partner determines in its discretion
that such modification is necessary or desirable as a result of the issuance of any applicable
law, Regulations, notice or ruling relating to the tax treatment of the transfer of a Partnership
Interests in connection with the performance of services. Notwithstanding anything to the contrary
in this Agreement, each Partner expressly confirms that it will be legally bound by any such
amendment.

[Remainder of Page Left Blank Intentionally]

85

 

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

	 	 	 	 	 
	 	GENERAL PARTNER:

YOUNAN PROPERTIES, INC.,
a Maryland corporation,

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Its: 	 
	 

	 	 	 	 	 
	 	LIMITED PARTNER:

                                        ,

a                                                  ,

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Its: 	 
	 

	 	 	 	 	 

	 

	 	LIMITED PARTNER:	 	 
	 

	 	 	 	 
	 

	 	 
	 	 
	 

	 	 
	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 

86

 

As of                     , 2010

EXHIBIT A

PARTNERS AND PARTNERSHIP UNITS

	 	 	 

	Name and Address of Partners

	 	Partnership Units (Type and Amount)
	 
	 
	 	 
	General Partner:
	 	 
	Younan Properties, Inc.

	 	Partnership Common Units               
	21700 Oxnard Street Suite 800
	 	 
	Woodland Hills, California 91367
	 	 
	 
	 	 
	 
	 
	 	 
	Limited Partners:
	 	 
	 
	 	 
	 
	 
	 	 
	 
	 
	 	 
	 
	 
	 	 
	 
	 
	 	 
	 
	 
	 	 
	 
	 
	 	 
	 
	 
	 	 
	 
	 
	 	 
	 
	 
	 	 
	TOTAL:

	 	Partnership Common Units

A-1

 

EXHIBIT B

EXAMPLES REGARDING ADJUSTMENT FACTOR

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

Example 1

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

          1.0 * 200/100 = 2.0

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

Example 2

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

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

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

Example 3

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

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

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

B-1

 

EXHIBIT C

NOTICE OF REDEMPTION

	 	 	 

	To:

	 	Younan Properties, Inc.

21700 Oxnard Street

Suite 800

Woodland Hills, California 91367

          The undersigned Limited Partner or Assignee hereby irrevocably tenders for Redemption
Partnership Common Units in Younan Properties, L.P. in accordance with the terms of the Amended and
Restated Agreement of Limited Partnership of Younan Properties, L.P., dated as of                 as amended (the “Agreement”), and the Redemption rights referred to therein. The undersigned
Limited Partner or Assignee:

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

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

          (c) represents, warrants, certifies and agrees that:

          (i) the undersigned Limited Partner or Assignee is a Qualifying Party,

          (ii) the undersigned Limited Partner or Assignee has, and at the closing of the
Redemption will have, good, marketable and unencumbered title to such Partnership
Common Units, free and clear of the rights or interests of any other person or
entity,

          (iii) the undersigned Limited Partner or Assignee has, and at the closing of
the Redemption will have, the full right, power and authority to tender and
surrender such Partnership Common Units as provided herein, and

          (iv) the undersigned Limited Partner or Assignee has obtained the consent or
approval of all persons and entities, if any, having the right to consent to or
approve such tender and surrender; and

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

All capitalized terms used herein and not otherwise defined shall have the same meaning

ascribed to them respectively in the Agreement.

C-1

 

	 	 	 

	Dated:                     

	 	Name of Limited Partner or Assignee:
	 
	 	 
	 
	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	(Signature of Limited Partner or Assignee)
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	(Street Address)
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	(City)          (State)          (Zip Code)
	 
	 	 
	 
	 	 
	 

	 	Signature Medallion Guaranteed by:
	 
	 	 
	 
	 	 
	 
	 	 
	 

	 	 
	Issue Check Payable to:
	 	 
	 
	 	 
	 

	 	 
	Please insert social security

or identifying number:
	 	 
	 

	 	 

C-2

 

EXHIBIT D

NOTICE OF ELECTION BY PARTNER TO CONVERT

LTIP UNITS INTO PARTNERSHIP COMMON UNITS

     The undersigned LTIP Unitholder hereby irrevocably (i) elects to convert the number of LTIP
Units in Younan Properties, L.P. (the “Partnership”) set forth below into Partnership Common Units
in accordance with the terms of the Amended and Restated Agreement of Limited Partnership of the
Partnership, as amended; and (ii) directs that any cash in lieu of Partnership Common Units that
may be deliverable upon such conversion to be deliverable upon such conversion be delivered to the
address specified below. The undersigned hereby represents, warrants, and certifies that the
undersigned (a) has title to such LTIP Units, free and clear of the rights or interests of any
other person or entity other than the Partnership; (b) has the full right, power, and authority to
cause the conversion of such LTIP Units as provided herein; and (c) has obtained the consent or
approval of all persons or entities, if any, having the right to consent or approve such
conversion.

	 	 	 	 	 

	Name of LTIP Unit Holder:
	 	 	 	 
	 	 	 
	 	 	Please Print Name as Registered with Partnership
	 
	 	 	 	 
	Number of LTIP Units to be Converted:

	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Date of this Notice:

	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	 	 	(Signature of LTIP Unit Holder)
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	 	 	(Street Address)
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	 	 	(City)          (State)          (Zip Code)

	 	 	 

	 

	 	Signature Medallion Guaranteed by:
	 
	 	 
	 
	 	 
	 
	 	 
	 

	 	 
	Issue Check Payable to:
	 	 
	 
	 	 
	 

	 	 
	Please insert social security

or identifying number:
	 	 
	 

	 	 

D-1

 

EXHIBIT E

NOTICE OF ELECTION BY PARTNERSHIP TO FORCE CONVERSION

OF LTIP UNITS INTO PARTNERSHIP COMMON UNITS

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

	 	 	 	 	 

	 
	 	 	 	 
	Name of LTIP Unit Holder:
	 	 	 	 
	 	 	 
	 	 	Please Print Name as Registered with Partnership
	 
	 	 	 	 
	Number of LTIP Units to be Converted:

	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Date of this Notice:

	 	 	 	 
	 

	 	 	 	 

E-1exv10w35

Exhibit 10.35

NONCOMPETITION AGREEMENT

     THIS NONCOMPETITION AGREEMENT (this “Agreement”) is dated as of ______________, 2010,
by and among Younan Properties, Inc., a Maryland corporation (the “REIT”), Younan
Properties, L.P., a Maryland limited partnership (the “Operating Partnership,” and together
with the REIT, the “Company”), and Zaya S. Younan (the “Executive”). Capitalized
terms used but not otherwise defined herein shall have the meanings ascribed to them in the
Employment Agreement (as defined below).

     WHEREAS, the Executive owns equity interests in the REIT’s predecessor company, such
predecessor company’s operating partnership subsidiary and certain other entities holding certain
properties (the “Predecessor Entities”);

     WHEREAS, in connection with the initial public offering of the REIT’s common stock, the REIT
and the Operating Partnership will directly or indirectly acquire, and the Executive will
contribute, sell or transfer to the REIT and the Operating Partnership, all of the Executive’s
ownership interests in the Predecessor Entities (collectively referred to as the “Formation
Transactions”);

     WHEREAS, the Executive’s execution of this Agreement is an integral part of, and a material
inducement to, the REIT’s and the Operating Partnership’s agreement to enter into the Formation
Transactions;

     WHEREAS, in connection with the execution of this Agreement, the REIT, the Operating
Partnership and the Executive are entering into an Employment Agreement, pursuant to which the
Executive will be employed as the President and Chief Executive Officer of the Company (the
“Employment Agreement”);

     WHEREAS, in connection with the execution of, and the transactions contemplated by, the
agreements evidencing the Formation Transactions and the Employment Agreement, the Company and the
Executive wish to set forth their agreement with respect to the Executive’s ability to compete with
the Company during, and for a limited period of time following, his employment with the Company.

     NOW, THEREFORE, in furtherance of the foregoing and in exchange for good and valuable
consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto hereby
agree as follows:

     1. Noncompetition.

     (a) During the Executive’s employment with the Company and for a period of one year following
a Covered Termination (such one-year period, the “Post-Termination Period”), the Executive
shall not engage in Competition (as defined below) with the Company or any of its subsidiaries.

     (b) For purposes of this Agreement, “Competition” shall mean the taking of any of the
following actions by the Executive: (i) conducting, directly or indirectly, any business

 

 

involving the development, acquisition, sale or management of “Class A” commercial office
properties, whether such business is conducted by the Executive individually or as principal,
partner, officer, director, consultant, employee, stockholder or manager of any person,
partnership, corporation, limited liability company or any other entity, except as provided below;
and (ii) ownership of interests in “Class A” commercial office properties that are competitive,
directly or indirectly, with any business carried on, directly or through one or more subsidiaries
or otherwise, by the Company; provided, however, that the term “Competition” shall not
include (A) the Executive’s activities related to the ownership, development, financing,
management, leasing, marketing, sale, transfer or exchange of any of the properties listed on
Schedule A hereto and any passive ownership interest in real property received in exchange
therefor, provided that, the Executive’s ownership and activities with respect to
any property received in any exchange for the properties listed on Schedule A otherwise
comply with the terms and conditions of this Agreement, (B) the Executive’s participation as a
passive investor in the ownership, development, financing, management, leasing, marketing, sale,
transfer or exchange of real property that does not compete, directly or indirectly, with any
business carried on by the Company or any of its subsidiaries, (C) the direct or indirect ownership
by the Executive of up to five percent of the outstanding equity interests of any public company,
(D) other real estate activities not related to “Class A” commercial office properties and (E)
solely with respect to the Post-Termination Period, the Executive’s conduct of business or
ownership of real property in geographical areas other than the geographical areas in which the
Company owns, as of the Date of Termination, real property.

     (c) For purposes of this Agreement, “Covered Termination” shall mean a termination of
the Executive’s employment with the Company for any reason other than (i) by the Executive for Good
Reason, (ii) by the Company without Cause or (iii) by reason of a Nonrenewal Termination.

     2. Specific Performance. The Executive acknowledges that in the event of breach by
the Executive of the terms of Section 1 hereof, the remedies at law available to the Company may be
inadequate and the Company shall be entitled to seek specific performance of this Agreement by the
Executive and to enjoin the Executive from any further violation of Section 1 hereof and to
exercise such remedies cumulatively or in conjunction with all other rights and remedies provided
by law and not otherwise limited by this Agreement. The Executive hereby acknowledges and agrees
that the Company shall not be required to post bond as a condition to obtaining or exercising such
remedies, and the Executive hereby waives any such requirement or condition.

     3. Severability. Any provision of this Agreement which is deemed invalid, illegal or
unenforceable in any jurisdiction shall, as to that jurisdiction and subject to this paragraph, be
ineffective to the extent of such invalidity, illegality or unenforceability, without affecting in
any way the remaining provisions hereof in such jurisdiction or rendering any other provisions of
this Agreement invalid, illegal or unenforceable in any other jurisdiction. Notwithstanding the
foregoing, if any provision of this Agreement should be deemed invalid, illegal or unenforceable
because its scope or duration is considered excessive, such provision shall be modified so that the
scope or duration of the provision is reduced only to the minimum extent necessary to render the
modified provision valid, legal and enforceable.

2

 

     4. Governing Law. This Agreement shall be governed, construed, interpreted and
enforced in accordance with the laws of the State of California, without regard to the conflict of
laws principles thereof.

     5. Entire Agreement. This Agreement, together with the Employment Agreement, contains
the entire agreement and understanding between the Company and the Executive with respect to the
subject matter hereof, and no representations, promises, agreements or understandings, written or
oral, not herein contained shall be of any force or effect. This Agreement shall not be changed
unless in writing and signed by both the Executive and an authorized representative of the Company.

     6. Assignment. This Agreement may not be assigned by the Executive, but may be
assigned by the REIT and/or the Operating Partnership to any successor to its business and will
inure to the benefit of and be binding upon any such successor.

     7. Notice. For the purposes of this Agreement, notices, demands and all other
communications provided for in this Agreement shall be in writing and shall be deemed to have been
duly given (i) when personally delivered, (ii) when transmitted by telecopy, electronic or digital
transmission with receipt confirmed, (iii) one day after delivery to a nationally recognized
overnight air courier guaranteeing next day delivery or (iv) upon receipt if sent by certified or
registered mail. In each case, notice shall be sent to:

	 	 	 	 	 
	 

	 	If to the Executive:
	 	Zaya S. Younan

5959 Topanga Canyon Boulevard

Woodland Hills, CA 91367
	 
	 	 	 	 
	 

	 	If to the Company:
	 	Younan Properties, Inc.

5959 Topanga Canyon Boulevard

Woodland Hills, California 91367

Attn: General Counsel

     8. Counterparts. This Agreement may be executed in several counterparts, each of
which shall be deemed to be an original but all of which together will constitute one and the same
instrument.

     9. Executive’s Acknowledgment. The Executive acknowledges (a) that he has had the
opportunity to consult with independent counsel of his own choice concerning this Agreement and (b)
that he has read and understands this Agreement, is fully aware of its legal effect, and has
entered into it freely based on his own judgment.

[Signature page follows]

3

 

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

	 	 	 	 	 	 	 

	 	 	YOUNAN PROPERTIES, INC.,
	 	 	a Maryland corporation
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 	 	 	 	 
	 

	 	Name	 	 	 	 
	 

	 	Title	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	YOUNAN PROPERTIES, L.P.,
	 	 	a Maryland limited partnership
	 
	 	 	 	 	 	 
	 	 	By:	 	Younan Properties, Inc.,
	 	 	 	 	a Maryland corporation,
	 	 	 	 	Its:  General Partner
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name	 	 
	 

	 	 	 	Title	 	 
	 
	 	 	 	 	 	 
	 	 	ZAYA S. YOUNAN
	 
	 	 	 	 	 	 
	 	 	 

4

 

SCHEDULE A

	 	 	 
	Property Name	 	Address
	One Graystone Centre

	 	3010 LBJ Freeway

Dallas, Texas 75244
	 
	 	 
	Younan Plaza

	 	6464 Savoy Street

Houston, Texas 00255
	 
	 	 
	Younan Square

	 	1010 Lamar Street

Houston, Texas 77002

5

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00179-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00179-of-00352.parquet"}]]