Exhibit 4.1
CONSENT OF GENERAL PARTNER AND
THIRD AMENDMENT TO SECOND
AMENDED AND RESTATED AGREEMENT OF
LIMITED PARTNERSHIP OF
ELDERTRUST OPERATING LIMITED
PARTNERSHIP
This Consent of General Partner and
Third Amendment to Second Amended and Restated Agreement of Limited
Partnership of ElderTrust Operating Limited Partnership (this
“ Consent and Third Amendment ”) is made and
entered into as of June 7, 2005 by and among ElderTrust Operating
Limited Partnership, a Delaware limited partnership (the “
Partnership ”), the holders of Class D Units (as
defined below) set forth on the signature pages hereto (the “
Class D Unit Holders ”), ElderTrust, a Maryland real
estate investment trust and the general partner of the Partnership
(the “ General Partner ”), and Ventas, Inc., a
Delaware corporation and a limited partner of the Partnership
(“ Ventas ”).
BACKGROUND:
WHEREAS, the Partnership was formed
on July 30, 1997, and in May of 1998 the Partnership adopted a
Second Amended and Restated Agreement of Limited Partnership, as
amended by that certain Second Amendment to Second Amended and
Restated Agreement of Limited Partnership of the Partnership dated
as of October 13, 1999, as supplemented by that certain Certificate
of Designation adopted March 10, 1999 and effective December 1,
1998, and as modified by that certain Agreement of Class C (LIHTC)
Unit Rights Modification dated November 19, 2003 (as so amended,
supplemented and modified, the “ Partnership Agreement
”; if not defined herein, all capitalized terms used in this
Consent and Third Amendment shall have the respective meanings
assigned to them in the Partnership Agreement), which amended and
restated in its entirety all prior agreements of limited
partnership of the Partnership;
WHEREAS, pursuant to that certain
Agreement and Plan of Merger entered into as of April 12, 2005 (the
“ Merger Agreement ”) by and among Ventas, VTRP
Merger Sub, LLC, a subsidiary of Ventas (“ Merger Sub
”), and Provident Senior Living Trust (“
Provident ”), Provident shall merge with and into
Merger Sub (the “ Merger ”), with Merger Sub
surviving the Merger;
WHEREAS, the Merger Agreement
provides that the holders of any vested or unvested common units of
limited partnership interest in PSLT OP, L.P., a Delaware limited
partnership, issued pursuant to Provident’s Long-Term
Incentive Plan (the “ LTIP Units ”) have the
right to contribute (the “ Contribution ”) each
LTIP Unit to the Partnership in exchange for 0.8022 of a unit of a
new class of Partnership Units, to be entitled “Class D
Units” (the “ Class D Units ”), issued
pursuant to Section 4.2.A of the Partnership Agreement;
and
WHEREAS, pursuant to the authority
granted to the General Partner pursuant to Section 14.1.B of the
Partnership Agreement, the General Partner desires to amend the
Partnership Agreement to establish the Class D Units, and to set
forth the designations, preferences and relative, participating,
option or other special rights, powers and duties of such Class D
Units pursuant to Section 4.2.A of the Partnership
Agreement.
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, intending to be
legally bound, hereby agree as follows:
1. Consent of General Partner
. The General Partner hereby consents and agrees to the admission
of each of the Class D Unit Holders as an Additional Limited
Partner and that all terms and conditions of the Partnership
Agreement that are necessary to be complied with or satisfied in
order to admit each Class D Unit Holder as an Additional Limited
Partner and hereby amend the Partnership Agreement have been
complied with or satisfied.
2. Admission of Class D Unit
Holders . Upon consummation of the Contribution and execution
of this Consent and Third Amendment, each of the Class D Unit
Holders will hereby be admitted to the Partnership as an Additional
Limited Partner, and Exhibit A to the Partnership Agreement will be
replaced with Exhibit A attached hereto which sets forth the
Partners (including the Class D Unit Holders) and their Partnership
Interests upon consummation of the Contribution. The name of each
of the Class D Unit Holders shall be recorded on the books and
records of the Partnership on the date hereof. Ventas and the
General Partner acknowledge that, upon such admission to the
Partnership, the capital account of each Class D Unit Holder shall
be equal to the aggregate fair market value of the LTIP Units
contributed by such Holder pursuant to the Contribution.
3. Definitions . (a) Article
I of the Partnership Agreement is hereby amended to add the
following definitions:
“Class D Unit” means a
Partnership Unit that is specifically designated by the General
Partner as being a Class D Unit.
“Merger Agreement” means
the Agreement and Plan of Merger dated as of April 12, 2005 by and
among Ventas, VTRP Merger Sub, LLC and Provident Senior Living
Trust.
“Provident Asset” means
properties acquired by Provident pursuant to the FBA SPA or the AHC
SPA, as such terms are defined in the Merger Agreement.
“Ventas” means Ventas,
Inc., a Delaware corporation and the sole shareholder of the
General Partner.
“Ventas Common Stock”
means the common stock, par value $0.25 per share, of
Ventas.
(b) The following definitions
appearing in Article I of the Partnership Agreement are hereby
amended and restated in their entirety to read as
follows:
“Common Unit” means a
Partnership Unit that is not a Preferred Unit. The Class A Units,
Class B Units, Class C (LIHTC) Units and Class D Units are Common
Units.
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“Notice of Redemption”
means a Notice of Redemption substantially in the form of Exhibit D
or solely with respect to holders of Class D Units, a Notice of
Redemption substantially in the form of Exhibit J.
4. Issuance of Additional
Partnership Interests . Section 4.2 of the Partnership
Agreement is hereby amended to add after Section 4.2.E the
following section:
F. Class D Units. Under the
authority granted to it by Section 4.2.A, the General Partner
hereby establishes an additional class of Partnership Units
entitled “Class D Units”. Except as expressly set forth
in this Agreement, each Class D Unit shall have the same rights,
privileges, and obligations as are set forth with respect to the
Class A Units in this Agreement.
5. Class D Unit Distributions
. The first sentence of Section 5.1.A. of the Partnership Agreement
before the proviso is hereby amended and restated in its entirety
to read as follows:
A. General. The General Partner
shall make distributions at least quarterly (i) first, to the
holders of the Class D Units in accordance with Section 5.1.F, and
thereafter (ii) any remaining Available Cash generated by the
Partnership during such quarter or shorter period shall be
distributed to the Partners who are Partners on the Partnership
Record Date with respect to such quarter or shorter period as
provided in Sections 5.1.B, 5.1.C, and 5.1.D;
6. Class D Unit Distributions
. Section 5.1 of the Partnership Agreement is hereby amended to add
after Section 5.1.E the following section:
F. Distributions With Respect to the
Class D Units. For purposes of this Section 5.1 and in lieu of the
methods of determining distributions for other holders of Common
Units, holders of the Class D Units will be entitled to a
distribution on each one (1) Class D Unit equal to any and all
dividends and/or distributions payable on the number of shares
(including, for purposes of this calculation, that portion of a
dividend that would relate to any fractional share) of Ventas
Common Stock into which one (1) Class D Unit is exchangeable under
the then-applicable Class D Exchange Ratio (as defined below) at
the same time as such dividends are payable and for the same
periods covered by such dividends. Any such distribution shall be
payable to holders of Class D Units regardless of whether the
Partnership has Available Cash and, in the event the Partnership
does not have sufficient funds to pay the entire amount payable to
holders of Class D Units, Ventas hereby agrees to cause additional
funds to be loaned to the Partnership in the amount necessary to
enable the Partnership to pay all distributions payable to holders
of Class D Units in accordance with the preceding
sentence.
7. Certain Tax Notices .
Section 7.1. of the Partnership Agreement is hereby amended to add
the following at the end of Section 7.1.E:
The Partnership shall notify each
holder of Class D Units in accordance with Section 15.1 of this
Agreement at least thirty (30) days prior to the date on which a
Provident Asset is sold if the sale of such Provident Asset would
result in income being allocated to such holder of Class D Units
pursuant to Section 704(c) of the Code.
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8. Redemption Rights .
Article VIII of the Partnership Agreement is hereby amended to add
the following new section:
Section 8.7 Class D Redemption
Right
A. General. In lieu of the
redemption rights set forth in Section 8.6, each holder of Class D
Units instead shall be entitled (the “Class D Redemption
Right”), at its discretion, to redeem all or any portion of
its Class D Units, at any time in exchange for the issuance by
Ventas of one (1) fully paid and non-assessable share of Ventas
Common Stock (as such number is adjusted pursuant to Section 8.7.B,
the “Class D Exchange Ratio”) for each one (1) Class D
Unit held by such holder of Clas
