EX-10.2 Second Amended and Restated Limited Partnership AgreementLimited Partnership Agreement |
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Exhibit 10.2
CABOT INDUSTRIAL VALUE FUND, L.P.
Second Amended and Restated Limited Partnership Agreement
July 21, 2005
(to be renamed DCT Industrial Value Fund I, L.P.)
Table of Contents
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Cabot Industrial Value Fund, L.P.
Second Amended and Restated Limited Partnership Agreement
1. Recitals and Definitions
1.1 Recitals . This Second Amended and Restated Limited Partnership Agreement (this “ Agreement ”) is entered into as of July 21, 2005 among Cabot Industrial Value Fund, Inc., a Maryland corporation (the “General Partner”), as the sole general partner, Cabot Industrial Value Fund Manager, LLC, a Delaware limited liability company (“ Cabot ”) as a limited partner and the other limited partners listed on Schedule A to amend and restate the Amended and Restated Limited Partnership Agreement dated of September 30, 2003 (the “ Original LP Agreement ”) of Cabot Industrial Value Fund, L.P., a Delaware limited partnership (the “ Partnership ”).1.2 Conversion of Partners . Cabot, the General Partner and the Other Limited Partners were the parties to the Original LP Agreement. Each hereby consents to the conversion of Cabot’s interest from a general partner partnership interest to a limited partner partnership interest and the conversion of the General Partner’s interest from a limited partner partnership interest to a general partner partnership interest.1.3 Definitions . Capitalized terms used in this Agreement shall have the meanings set forth or referred to below.“ Act ” means the Delaware Revised Uniform Limited Partnership Act, as amended from time to time.
“ Agreement ” - See Section 1.1.
“ Allowed Asset Management Agreement ” – See Section 8.2.
“ Baltimore Property ” is defined in the Merger Agreement.
“ Cabot Limited Partners ” means Cabot and the Other Limited Partners.
“ CapEx ” means tenant improvements, leasing commissions and other capital expenditures to the Properties.
“ Capital Account ” - See Section 3.3.
“ Capital Call Notice ” - See Section 3.1.
“ Capital Contributions ” means the Initial Capital together with any funds provided to the Partnership by the Partners pursuant to Section 3.4.
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“ Certificate ” - See Section 2.1.
“ Code ” means the Internal Revenue Code of 1986, as amended from time to time, and, to the extent applicable, regulations promulgated thereunder.
“ Cost Base ” means $695,300,000 plus (1) out-of-pocket diligence, legal, accounting and other transaction costs incurred by any GP Affiliate in connection with the acquisition of its interest in the General Partner, the negotiation and consummation of the transactions contemplated by the Merger Agreement, and the negotiation of the Put/Call Agreement, plus (2) the cost of acquiring any additional properties by the Partnership or its Subsidiaries (including out-of-pocket diligence, legal, accounting and other transaction costs), and less (3) the gross sale proceeds from the sale of any Property less net closing adjustments and out-of-pocket transaction costs incurred in connection therewith.
“ CSFB Agreement ” means the letter agreement dated January 14, 2002, between the Credit Suisse First Boston Corporation and Cabot Properties LLC as assigned on December 4, 2002 to and assumed by the Partnership, as amended on December 20, 2002, April 16, 2003 and December 5, 2003.
“ DCT ” means Dividend Capital Trust Inc., a Maryland corporation.
“ Fiscal Year ” – See Section 4.8.
“ Funding Partner ” – See Section 3.4(c)
“ General Partner ” - See Section 1.1.
“ General Partner Indemnified Parties ” - See Section.
“ GP Affiliate ” means (i) DCT, (ii) the General Partner, (iii) any person directly or indirectly through one or more entities, beneficially owning an equity interest in the General Partner (excluding shareholders in DCT and their direct and indirect beneficial owners), (iv) any officer, director, or trustee of the foregoing, or (v) any entity controlled by, controlling or under common control with DCT or the General Partner.
“ GP Affiliate Loan ” means a loan from a GP Affiliate to the Partnership.
“ Helen Street Property ” means the property at 200 Helen Street in South Plainfield, New Jersey indirectly owned by a subsidiary of the Partnership.
“ Helen Street Value ” is defined in the Merger Agreement.
“ Initial Capital ” - See Section 3.1.
“ Limited Partners ” means Cabot and the Other Limited Partners as long as they are partners in the Partnership.
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“ Merger Agreement ” means the Agreement and Plan of Merger between DCT, DCT Acquisition Corporation, Cabot, and the General Partner dated as of June 17, 2005.
“ Net Capital Proceeds ” - See Section 6.1.
“ Operating Cash Flow ” - See Section 6.1.
“ Other Limited Partners ” means those parties listed on Schedule A as other limited partners.
“ Partner ” means each of the General Partner, Cabot and the Other Limited Partners as long as they are partners in the Partnership.
“ Partnership ” - See Section 1.1.
“ Percentage ” means, as to each Partner, the percentage listed on Schedule A as it may be adjusted pursuant to the terms of this Agreement.
“ Preferred Percentage ” means, as to each Cabot Limited Partner, the percentage listed on Schedule A as its preferred percentage.
“ Properties ” - means the properties owned by the Partnership or any of its direct or indirect subsidiaries as of the date of this Agreement, or hereafter acquired as permitted under this Agreement.
“ Put/Call Agreement ” means the Put/Call Agreement dated as of date of this Agreement entered into by the Cabot Limited Partners, the General Partner and DCT regarding transfers of interests in the Partnership.
“ Seattle Property ” means that property at South 212th Street, Kent, Washington to be acquired by a subsidiary of the Partnership.
“ Seller Pro Rata Percentage ” – is defined in the Merger Agreement.
“ Seller Representative ” – is defined in the Merger Agreement.
“ Stockholders ” – is defined in the Merger Agreement.
“ Subsidiaries ” – is defined in the Merger Agreement.
2. Formation of Partnership
2.1 Organization . The Partnership has been formed by the filing of its Certificate of Limited Partnership with the Delaware Secretary of State pursuant to the Act. The Certificate of Limited Partnership may be restated by the General Partner as provided in the Act or amended by the General Partner to change the name of the Partnership, the address of the office of the Partnership in Delaware and the name and address of its resident agent in Delaware or to make3corrections required by the Act. The Certificate of Limited Partnership, as so amended from time to time, is referred to herein as the “ Certificate .” The General Partner shall deliver a copy of the Certificate and any amendment thereto to any Partner who so requests.2.2 Partnership Name .(a) The name of the Partnership is “Cabot Industrial Value Fund, L.P.”(b) Within five business days after the date of this Agreement, the General Partner shall change the name of the Partnership to “DCT Industrial Value Fund I, L.P.”.(c) Within five business days after the date of this Agreement, the General Partner will change its name to “DCT Industrial Value Fund I, Inc.”2.3 Purposes and Powers . The principal business activity and purposes of the Partnership shall be to acquire, improve, develop, finance, hold, own, operate, maintain, manage, hold, lease, redevelop, sell, mortgage, pledge, exchange, convey, or otherwise dispose of the Properties either directly or through direct or indirect subsidiaries of the Partnership, and to engage in all activities necessary, convenient or incidental thereto in accordance with the terms of this Agreement. The business of the Partnership shall be conducted in such a manner as the General Partner reasonably believes will permit the General Partner at all times after December 31, 2002 to be classified as a real estate investment trust under Code Section 856.2.4 Principal Business Office, Registered Office and Registered Agent .(a) The principal business office of the Partnership shall be located at:
c/o Dividend Capital Trust Inc.
The principal business office of the Partnership may be changed from time to time by the General Partner. The General Partner shall promptly notify the Partners of any change in such principal business office.
(b) The registered office of the Partnership in the State of Delaware shall be c/o The Corporation Trust Company, 1209 Orange Street, Wilmington, Delaware, 19801. The agent for service of process on the Partnership pursuant to the Act shall be The Corporation Trust Company, 1209 Orange Street, Wilmington, Delaware, 19801. The registered agent and registered office of the Partnership may be changed by the General Partner from time to time. The General Partner shall promptly notify the Partners of any such change.2.5 Qualification in Other Jurisdictions . The General Partner shall cause the Partnership to be qualified or registered to the extent required under applicable laws in each state in which a Property is located and in any other jurisdiction in which the Partnership transacts business and shall be authorized to execute, deliver and file any certificates and documents4necessary to effect such qualification or registration, including without limitation the appointment of agents for service of process in such jurisdictions.2.6 Powers . In furtherance of its purposes, but subject to all of the provisions of this Agreement, the Partnership shall have and exercise all of the powers and rights which can be conferred upon limited partnerships formed pursuant to the Act.2.7 Partners . The Partners of the Partnership and their addresses are listed on Schedule A . The General Partner shall amend Schedule A from time to time by to reflect the withdrawal of Partners or the admission of additional Partners pursuant to this Agreement.3. Capitalization
3.1 Initial Capital Contributions . The General Partner has contributed (or will contribute on the date hereof) capital to the Partnership in the amount shown on Schedule A and each Limited Partner is deemed to have contributed capital to the Partnership in the amounts shown as such Partner’s Capital on Schedule A (the “ Initial Capital ”).3.2 GP Affiliate Loan . The Partnership has borrowed and may borrow from time to time GP Affiliate Loans. The interest rate on a GP Affiliate Loan shall not be in excess of DCT’s incremental cost of its third party borrowed funds from time to time. The maximum principal amount of the GP Affiliate Loans which when added to the mortgage debt of the Partnership shall not exceed CapEx plus 50% of the Cost Base. The GP Affiliate Loan shall have a term of at least 2 years after the date of this Agreement, shall only require monthly payments of interest in arrears, with no required payments of principal until after July 1, 2007. Each of the Cabot Limited Partners shall have the right to partially guarantee up to its pro rata share (based on their relative Percentages) of $4,556,000 million of the initial GP Affiliate Loan pursuant to “bottom dollar guarantees” in the form of Schedule 3.2 attached hereto.3.3 Capital Accounts . A separate capital account (each, a “ Capital Account ”) shall be maintained for each Partner in accordance with the rules of Treasury Regulations Section 1.704-1(b)(2)(iv), and this Section 3.3 shall be interpreted and applied in a manner consistent therewith. The balance of each Partner’s Capital Account as of the date of this Amendment has been adjusted to equal the fair market value of its interest as set forth on Schedule A . Whenever the Partnership would be permitted to adjust the Capital Accounts of the Partners pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect revaluations of Partnership property, the Partnership shall so adjust the Capital Accounts of the Partners. In the event that the Capital Accounts of the Partners are adjusted pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect revaluations of Partnership property, (i) the Capital Accounts of the Partners shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(g) for allocations of depreciation, depletion, amortization and gain or loss, as computed for book purposes, with respect to such property, (ii) the Partners’ distributive shares of depreciation, depletion, amortization and gain or loss, as computed for tax purposes, with respect to such property shall be determined so as to take account of the variation between the adjusted tax basis and book value of such property in the same manner as under Code Section 704(c) and (iii) the amount of upward and/or downward adjustments to the book value of the Partnership property5shall be treated as income, gain, deduction and/or loss for purposes of applying the allocation provisions of Article 5. In the event that Code Section 704(c) applies to Partnership property, the Capital Accounts of the Partners shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(g) for allocations of depreciation, depletion, amortization and gain and loss, as computed for book purposes, with respect to such property. The Capital Accounts of the Partners shall be maintained solely for the purpose of allocating income and loss among the Partners for tax purposes, and shall not affect the distributions payable to any Partner, including upon liquidation of the Partnership. The Partners shall not be required to contribute capital to the Partnership to restore a deficit balance in its Capital Account upon liquidation or otherwise.3.4 Capital Contributions for Unanticipated Needs .(a) If the General Partner determines that additional capital is needed for the operations of the Partnership it may be called in accordance in this Section 3.4.(b) If the General Partner determines that the Partnership requires additional funds beyond funds made available pursuant to Section 3.1 or Section 3.2 to meet its existing obligations or to conduct its business, the General Partner may give written notice (a “ Capital Call Notice ”) to the Partners indicating the amount required by the Partnership and the purpose for which such funds are required. Within ten business days of receipt of such Capital Call Notice, each Partner shall give notice to the General Partner indicating whether or not it agrees to make an additional capital contribution to the Partnership in an amount equal to its pro rata share, based upon their Percentages, of the required funds. If any Partner elects to make a capital contribution, then the Partner shall make a capital contribution in the amount of its pro rata share of the required funds within five business days of such election.(c) If any Partner elects not to make an additional capital contribution pursuant to the Capital Call Notice, any Partner which has agreed to fund its pro rata share of the requested capital (each a “ Funding Partner ”) may at any time thereafter as long as the Partnership continues to require such additional funds indicated in the Capital Call Notice, give written notice (an “ Optional Funding Notice ”) to the other Partners that it is prepared to make all or a portion of the required funds available to the Partnership. Each Funding Partner shall be entitled to provide up to its pro rata share, based on Percentages, of the required funds by contributing such funds to the Partnership not later than ten business days after the Optional Funding Notice.(d) After the contribution of capital pursuant to a Capital Call Notice or Optional Funding Notice in which not all Partners participate, each Partner’s Percentage will be adjusted to equal the quotient of (A) the sum of (x) the Partner’s Initial Capital plus (y) the amount of cash, if any, contributed by the Partner since the date hereof divided by (B) the sum of (u) all Partners’ Initial Capital plus (v) the aggregate amount of all cash contributed by all Partners since the date of this Agreement. The funds contributed pursuant to a Capital Call Notice or Optional Funding Notice will not receive any preferred payment, special allocation or other special treatment other than the foregoing adjustment to Percentages.6(e) Each Partner acknowledges that the failure to participate in any funding pursuant to this Section 3.4 may result in a dilution of its interest and rights in the Partnership. No Cabot Limited Partner shall be obligated to provide funds pursuant to this Section 3.4.4. Books; Accounting; Tax Elections; Reports
4.1 Books and Records . The General Partner shall keep complete and accurate books and records of the Partnership in accordance with generally accepted accounting principles. The books of the Partnership shall at all times be maintained or made available at the principal business office of the Partnership. A current list of the full name and last known business address of each Partner, set forth in alphabetical order, a copy of the Certificate and all amendments thereto, executed copies of all powers of attorney pursuant to which the Certificate or any certificate of amendment has been executed, copies of the Partnership’s federal, state and local income tax returns and reports, if any, for the three most recent years, copies of this Agreement and of any financial statements of the Partnership for the three most recent years and all other records required to be maintained pursuant to the Act shall be maintained at the principal business office of the Partnership.4.2 Annual Financial Statements and Valuation . Within ninety (90) days after the end of each Fiscal Year, the General Partner, at Partnership expense, shall prepare and mail to each Limited Partner and to each former Partner who withdrew during such Fiscal Year (or to such former Partner’s legal representative, as applicable) (i) a summary description of each acquisition or disposition by the Partnership during the previous Fiscal Year, including any transactions with any GP Affiliate, and (ii) a statement of all distributions made to such Partner during the previous fiscal quarter and the previous Fiscal Year and such Partner’s Capital Account balance. The General Partner shall also furnish to the Limited Partners a balance sheet and schedule of investments of the Partnership as of the end of the Fiscal Year and statements of operations, and cash flow for such Fiscal Year, in each case certified by the General Partner as true and correct and prepared in accordance with generally accepted accounting principles as customarily implemented by DCT. Consistent with the requirements of generally accepted accounting principles, the Partnership’s assets will be presented on a book value basis.4.3 Quarterly Financial Statements . Within sixty (60) days after the end of each of the first three (3) quarters of each Fiscal Year, the General Partner shall mail to each Limited Partner unaudited balance sheets, an unaudited cash flow statement and an unaudited income statement of the Partnership as at such quarter-end. The General Partner shall also provide the Partners with a quarterly report of the Partnership’s business and activities, including a summary of investments and dispositions made during the prior quarter.4.4 Insurance . The General Partner shall cause the Properties to be insured in accordance with customary practices. In any event, the insurance coverage should be no less than comparable insurance carried by DCT and its subsidiaries on properties similar to the Properties.74.5 Right to Information . Each Partner shall have the right at all reasonable times during usual business hours to examine and make copies of or extracts from the books of account and records of the Partnership and to have such materials audited at such Partner’s expense. The General Partner shall promptly furnish to the Partners (i) such other information bearing on the financial condition and operations of the Partnership or the status of the Property as a Partner may from time to time reasonably request and (ii) such information as Cabot deems necessary or appropriate to comply with the tax disclosure, list maintenance and registration requirements of Sections 6011, 6111 and 6112 of the Code and the regulations promulgated thereunder.4.6 Filing of Returns; Tax Information .(a) The General Partner shall cause the preparation and timely filing of all Partnership tax returns and reports and shall, on behalf of the Partnership, timely file all other writings required by any governmental authority having jurisdiction. The General Partner shall timely provide to each Partner information sufficient to permit them to file their respective income tax returns, including information sufficient to determine estimated tax payments required with respect to the income of the Partnership for quarterly estimated tax payments and with respect to any extension for filing their income tax returns, if applicable.(b) With respect to any tax return that includes any taxable periods or portions thereof beginning on or prior to the date of this Agreement (an “ Applicable Tax Return ”), the General Partner shall prepare such returns in a manner consistent with past practice, except as otherwise consented to by Cabot. The General Partner shall provide copies of any Applicable Tax Returns to Cabot for review and approval at least forty-five (45) days prior to the anticipated filing date thereof. If Cabot objects to the treatment of any item reflected on such tax return, the parties shall attempt to resolve such dispute in good faith and if no resolution is reached, will submit the matter to an independent accounting or law firm for a determination of which party’s position is supported by the greater weight of authority. Such determination shall be binding on both parties. The General Partner shall not amend any Applicable Tax Return without the consent of Cabot.4.7 Tax Matters Partner . The General Partner shall be the “tax matters partner” for purposes of Section 6231 of the Code. The tax matters partner shall keep the Partners fully apprised of any action required to be taken or which may be taken by the tax matters partner for the Partnership.4.8 Fiscal and Taxable Year . The “Fiscal Year” of the Partnership shall be the same as the taxable year of the Partnership. The taxable year of the Partnership shall be the period ending on December 31.4.9 Taxation as Partnership . The Partners agree that the Partnership will be taxed as a partnership, and the General Partner shall use all reasonable efforts to ensure that the Partnership is treated as a partnership for tax purposes.85. Allocation Of Income And Loss
5.1 Allocation of Profits and Losses . All items of Partnership income, gain, loss and deduction as determined for Code Section 704(b) book purposes shall be allocated among the Partners and credited or debited to their respective Capital Accounts in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv), so as to ensure to the maximum extent possible (i) that such allocations satisfy the economic effect equivalence test of Treasury Regulations Section 1.704-1(b)(2)(ii)(i) (as provided hereinafter) and (ii) that all allocations of items that cannot have economic effect (including credits and nonrecourse deductions) are allocated to the Partners in accordance with the Partners’ interests in the Partnership, which, unless otherwise required by Code Section 704(b) and the Treasury Regulations promulgated thereunder, shall be in proportion to their Percentages. To the extent possible, items that can have economic effect shall be allocated in such a manner that the balance of each Partner’s Capital Account at the end of any taxable year (increased by the sum of (a) such Partner’s “share of partnership minimum gain” as defined in Treasury Regulations Section 1.704-2(g)(1) and (b) such Partner’s share of “partner nonrecourse debt minimum gain” as defined in Treasury Regulations Section 1.704-2(i)(5)) would be positive to the extent of the amount of cash that such Partner would receive (or would be negative to the extent of the amount of cash that such Partner would be required to contribute to the Partnership) if the Partnership sold all of its property for an amount of cash equal to the book value (as determined pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv)) of such property (reduced, but not below zero, by the amount of nonrecourse debt to which such property is subject) and all of the cash of the Partnership remaining after payment of all liabilities (other than nonrecourse liabilities) of the Partnership were distributed in liquidation immediately following the end of such taxable year in accordance with Section 6.2.5.2 Section 704(c) Tax Allocations . Except as set forth below or as required by the Code or Regulations, income, gain, loss and deduction of the Partnership shall be allocated for tax purposes in the same manner as such items were allocated for book purposes pursuant to Section 5.1. With respect to any property of the Partnership to which Section 704(c) applies or with respect to which the principles of Section 704(c) apply as a result of any adjustment to the valuation thereof pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv)(f), the Partnership shall use the “traditional method” of allocating income, gain, deduction and loss, in each case without curative or remedial allocations. Allocations pursuant to this Section 5.2 shall be for U.S. federal income tax purposes and shall not affect the Capital Account balances of the Partners.6. Distributions
6.1 Definitions Relating to Distributions . The following terms have the meanings indicated:“ Operating Cash Flow ” means all receipts of the Partnership and its direct or indirect subsidiaries (other than Net Capital Proceeds, proceeds from the Helen Street Property pursuant to Section 6.3 below and proceeds from the sale of the Baltimore Property pursuant to Section 6.4 below) in excess of the following items (except to the extent any of the following are funded out of reserves or
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proceeds from capital events): (i) operating expenses, (ii) scheduled debt service payments, including debt service on the GP Affiliate Loan and (iii) the funding of reserves of $0.10 per rentable square foot at the Properties per year.
“ Net Capital Proceeds ” means proceeds from any sale (other than proceeds from the Helen Street Property pursuant to Section 6.3 below and from the sale of the Baltimore Property pursuant to Section 6.4 below), refinancing, insurance recovery, eminent domain award or other similar capital event, in excess of amounts required to pay (i) debt then due, (ii) amounts expended to purchase additional properties pursuant to a 1031 exchange, and (iii) out-of-pocket transaction costs.
6.2 Distributions . Operating Cash Flow shall be distributed quarterly as soon as practicable, and in any event, within fifteen days after the end of each quarter, to the extent such distribution is not prohibited by third-party debt agreements of the Partnership or a Subsidiary. Net Capital Proceeds, if any, and any proceeds from the Helen Street Property pursuant to Section 6.3 below and proceeds from the Baltimore Property pursuant to Section 6.4 below shall be distributed as soon as reasonably practicable, and in any event within ten days after the same become available for distribution, to the extent such distribution in not prohibited by third-party debt agreements of the Partnership or a Subsidiary. All distributions of Operating Cash Flow an | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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