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EXHIBIT 10.9
AMENDMENT NO. 8 TO THE SECOND AMENDED
AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
OF
WINN LIMITED PARTNERSHIP
This Amendment No. 8 (this "Amendment") to the Second Amended
and
Restated Agreement of Limited Partnership
of WINN Limited Partnership dated July
11, 1997 (the "Partnership Agreement") is
entered into as of February 24, 2004,
by and among Winston Hotels, Inc., a North
Carolina corporation (the "General
Partner"), and the limited partners (the
"Limited Partners") of WINN Limited
Partnership (the "Partnership"). All
capitalized terms used herein and not
otherwise defined shall have the meanings
assigned to them in the Partnership
Agreement.
WHEREAS, the General Partner, on even date herewith, has issued
3,680,000 shares of its 8.00% Series B
Cumulative Preferred Stock, $.01, par
value per share, having a liquidation
preference equivalent to $25.00 per share
(the "Series B Preferred Stock"), and has
sold such Series B Preferred Stock in
an underwritten public offering (the
"Series B Offering");
WHEREAS, the General Partner desires to contribute the net proceeds
of
the sale of the Series B Preferred Stock to
the Partnership in exchange for the
issuance to the General Partner of
preferred partnership interests in the
Partnership as set forth herein;
WHEREAS, the General Partner is authorized to cause the Partnership
to
issue interests in the Partnership to the
General Partner in exchange for such
contribution of such net proceeds made by
the General Partner;
WHEREAS, the Partnership will use a portion of the net proceeds
to
redeem from the General Partner currently
outstanding Series A Preferred Units
in the Partnership (as set forth
herein).
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and other good and valuable
consideration, the receipt and
sufficiency of which are hereby
acknowledged, the parties hereto agree to amend
the Partnership Agreement as follows:
SECTION 1.
CONTRIBUTION.
The General Partner hereby contributes to the Partnership the
entire
net proceeds received by the Corporation
from the issuance of the Series B
Preferred Stock. As provided in Section
4.02(g) of the Partnership Agreement,
the Corporation shall be deemed to have
made a Capital Contribution to the
Partnership in an amount equal to the gross
proceeds raised in connection with
the issuance of such shares of Series B
Preferred Stock, which is $92,000,000,
and the Partnership shall be deemed
simultaneously to have paid, pursuant to
Section 6.05(b) of the Partnership
Agreement, for the costs and expenses
relating to the offer, registration and
sale of the Series B Preferred Stock.
SECTION 2.
ISSUANCE OF SERIES B PREFERRED UNITS.
In consideration of the contribution to the Partnership made by
the
General Partner pursuant to Section 1
hereof, the Partnership hereby issues to
the General Partner 3,680,000 Series B
Preferred Units (as defined below).
SECTION 3.
DEFINITIONS.
Article I of the Partnership Agreement is hereby amended by
inserting
in the appropriate alphabetical locations
the following definitions of Series B
Preferred Return, Series B Preferred Stock
and Series B Preferred Units, as
follows:
"Series B Preferred Return" means an annualized amount equal to
$2.00
per Series B Preferred Unit.
"Series B Preferred Stock" means the 8.00% Series B Cumulative
Preferred Stock, $.01 par value per share,
of the Corporation.
"Series B Preferred Units" means the Preferred Units issued to
the
General Partner in exchange for the net
proceeds of the issuance by the
Corporation of its Series B Preferred
Stock, which Series B Preferred Units
shall have the designations, preferences,
privileges, limitations and relative
rights set forth in Section 4.02(c)(ii)
hereof.
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SECTION 4.
REDEMPTION OF SERIES A PREFERRED UNITS.
The Partnership hereby redeems the Series A Preferred Units in
the
Partnership. Effective upon the redemption
of the Series A Preferred Units,
Section 4.02(c)(i) of the Partnership
Agreement, as set forth in Section 4 of
Amendment No. 1 to the Partnership
Agreement, shall be deleted in its entirety
and Section 4.02(c)(i) shall hereinafter
read "[Intentionally Left Blank]."
SECTION 5.
CREATION OF SERIES B PREFERRED UNITS.
Article IV of the Partnership Agreement is hereby amended by
adding
Section 4.02(c)(ii) as follows:
"(ii) 8.00% Series B Cumulative Preferred Units.
(1)
Designation and Number. A series of Preferred Units,
designated the "8.00% Series B Cumulative Preferred Units" (the
"Series
B Preferred Units"), is hereby established. The number of Series
B
Preferred Units shall be 3,680,000.
(2) Rank. The
Series B Preferred Units will, with respect to
distribution rights and rights upon liquidation, dissolution or
winding
up of the Partnership, rank (i) senior to all classes or series
of
Common Units of the Partnership, and to all Partnership Units
ranking
junior to the Series B Preferred Units with respect to
distribution
rights or rights upon liquidation, dissolution or winding up of
the
Partnership; (ii) on a parity with all Partnership Units issued by
the
Partnership the terms of which specifically provide that such
Partnership Units rank on a parity with the Series B Preferred
Units
with respect to distribution rights or rights upon liquidation,
dissolution or winding up of the Partnership; and (iii) junior to
all
existing and future indebtedness of the Partnership. The term
"Partnership Units" does not include convertible debt securities,
which
will rank senior to the Series B Preferred Units prior to
conversion.
(3)
Distributions.
(a) Holders of
the Series B Preferred Units are entitled
to receive, when and as distributed by the General Partner out
of
available cash flow, preferential cumulative cash distributions in
an
amount equal to the excess, if any, of (i) the cumulative Series
B
Preferred Return for the current and all prior years over (ii) the
sum
of all prior Series B Preferred Return distributions pursuant to
this
Section 4.02(c)(ii)(3). Distributions on the Series B Preferred
Units
shall be cumulative from the date of original issue and shall
be
payable quarterly in arrears on or before the 16th day of
January,
April, July and October of each year, or, if not a Business Day
(as
defined below), the next succeeding business day (each, a
"Distribution
Payment Date"). The first distribution will be paid on or before
April
16, 2004. The first distribution will be prorated for less than a
full
quarter. Any distribution payable on the Series B Preferred Units
for
any partial distribution period will be computed on the basis of
a
360-day year consisting of twelve 30 day months. Distributions will
be
payable to holders of record as they appear in the ownership
records of
the Partnership at the close of business on the applicable record
date,
which shall be the last Business Day of each of March, June,
September
and December immediately preceding such Distribution Payment Date,
or
on such other date designated by the General Partner of the
Partnership
for the payment of distributions that is not more than 30 nor less
than
10 days prior to such Distribution Payment Date (each, a
"Distribution
Record Date"). "Business Day" shall mean any day, other than a
Saturday
or Sunday, that is neither a legal holiday nor a day on which
banking
institutions in New York City are authorized or required by
law,
regulation or executive order to close.
(b) The amount
of any distributions accrued on any Series
B Preferred Units at any Distribution Payment Date shall be the
amount
of any unpaid distributions accumulated thereon, to and including
such
Distribution Payment Date, whether or not earned or declared, and
the
amount of distributions accrued on any Series B Preferred Units at
any
date other than a Distribution Payment Date shall be equal to the
sum
of the amount of any unpaid distributions accumulated thereon, to
and
including the last preceding Distribution Payment Date, whether or
not
earned or declared, plus an amount calculated on the basis of
the
Series B Preferred Return for the period after such last
preceding
Distribution Payment Date to and including the date as of which
the
calculation is made based on a 360-day year of twelve 30-day
months.
(c) Except as
provided in subsection (a) hereof, the
holder of the Series B Preferred Units will not be entitled to
any
distributions in excess of full cumulative distributions as
described
above and shall not be entitled to
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participate in the earnings or assets of the Partnership, and
no
interest, or sum of money in lieu of interest, shall be payable
in
respect of any distribution payment or payments on the Series B
Preferred Units which may be in arrears.
(d) No
distributions on Series B Preferred Units shall be
declared by the General Partner or paid or set apart for payment by
the
Partnership if the terms and provisions of any agreement of the
Partnership, including any agreement relating to its
indebtedness,
prohibit such declaration, payment or setting apart for payment
or
provide that such declaration, payment or setting apart for
payment
would constitute a breach thereof or a default thereunder, or if
such
declaration or payment shall be restricted or prohibited by
law.
Notwithstanding the foregoing, distributions on the Series B
Preferred
Units will accrue whether or not the Partnership has earnings,
whether
or not there is available cash flow for the payment of such
distributions and whether or not such distri
