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EXHIBIT 10.4
SEVENTH AMENDMENT TO
THIRD AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
COLONIAL REALTY LIMITED PARTNERSHIP
THIS SEVENTH AMENDMENT (this "Seventh Amendment") TO THIRD
AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP OF COLONIAL REALTY LIMITED
PARTNERSHIP (as amended by Amendments dated
as of January 5, 2000, as of January
25, 2000, as of August 28, 2000, as of
April 17, 2001, as of June 19, 2001 and
as of April 30, 2003, collectively, the
"Partnership Agreement"), dated as of
February 18, 2004, is entered into among
Colonial Properties Trust, as general
partner (the "General Partner") of Colonial
Realty Limited Partnership (the
"Partnership"), for itself and on behalf of
the limited partners of the
Partnership (the "Limited Partners"), and
each of the holders of the Series B
Preferred Units.
WHEREAS, the General Partner desires to, and each holder of Series
B
Preferred Units desires to consent to,
amend the Partnership Agreement to (i)
reduce the Priority Return with respect to
the Series B Preferred Units, (ii)
amend the terms of the redemption rights
with respect to the Series B Preferred
Units, and (iii) make the Series B
Preferred Units callable on or after February
24, 2009.
NOW, THEREFORE, in consideration of good and valuable
consideration,
the receipt and sufficiency of which hereby
are acknowledged, the General
Partner hereby amends the Partnership
Agreement, as follows:
1.
Exhibits to Partnership Agreement. The Partnership Agreement
is hereby amended by deleting Exhibit H
attached thereto and substituting
Exhibit H attached hereto therefor.
2.
Certain Capitalized Terms. All capitalized terms used in this
Seventh Amendment and not otherwise defined
shall have the meanings assigned in
the Partnership Agreement. Except as
modified herein, all terms and conditions
of the Partnership Agreement shall remain
in full force and effect, which terms
and conditions the General Partner hereby
ratifies and affirms.
3.
Approval. To the extent such approval or consent is required
pursuant to Section 5(b)(iii) of Exhibit H
or any other provision of the
Partnership Agreement, each of the
undersigned holders of Series B Preferred
Units, constituting 100% of the holders of
the issued and outstanding Series B
Preferred Units, hereby approves and
consents to the amendment of the
Partnership Agreement set forth in this
Seventh Amendment.
[Signatures appear on following page]
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IN WITNESS WHEREOF, the undersigned has executed this Seventh
Amendment
as of the date first set forth above.
COLONIAL PROPERTIES TRUST,
as General Partner of
Colonial Realty Limited Partnership
By: /s/ Howard B. Nelson, Jr.
----------------------------------------------
Name: Howard B.
Nelson, Jr.
Title: Chief Financial Officer and Secretary
Series B Preferred Unit Holders:
BELAIR REAL ESTATE CORPORATION
By: /s/ William R. Cross
----------------------------------------------
Name: William R.
Cross
Title: Vice President
BELCREST REALTY CORPORATION
By: /s/ William R. Cross
----------------------------------------------
Name: William R.
Cross
Title: Vice President
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EXHIBIT H
DESIGNATION OF THE PREFERENCES, RIGHTS, VOTING POWERS,
RESTRICTIONS,
QUALIFICATIONS AND LIMITATIONS OF THE
SERIES B PREFERRED UNITS
The Series B Preferred Units shall have the following
designations,
preferences, rights, powers and duties:
(1)
DEFINITIONS. For purposes of this Amendment, (i) the
term "PARITY PREFERRED UNITS" shall be used
to refer to any class or series of
Partnership Interests of the Partnership
now or hereafter authorized, issued or
outstanding expressly designated by the
Partnership to rank on a parity with
Series B Preferred Units (as hereinafter
defined) with respect to distributions
and rights upon voluntary or involuntary
liquidation, winding-up or dissolution
of the Partnership and include, without
limitation, the Series C Preferred Units
(as defined in that certain Fifth Amendment
to Third Amended and Restated
Agreement of Limited Partnership of the
Partnership, dated as of June 19, 2001)
(the "SERIES C PREFERRED AMENDMENT"), the
Series D Preferred Units (as defined
in that certain Sixth Amendment to Third
Amended and Restated Agreement of
Limited Partnership of the Partnership,
dated as of April 30, 2003) (the "SERIES
D PREFERRED AMENDMENT"), and any other
class or series of Preferred Units that
by its terms ranks on a parity with respect
to the Series C Preferred Units (as
defined in the Series C Preferred
Amendment) or the Series D Preferred Units (as
defined in the Series D Preferred
Amendment), (ii) the term "PRIORITY RETURN"
shall mean, an amount equal to 8.875% per
annum up to and including February 23,
2004, and 7.25% per annum from and after
February 24, 2004, in each case
determined on the basis of a 360 day year
of twelve 30 day months (or actual
days for any month which is shorter than a
full monthly period), cumulative to
the extent not distributed for any given
distribution period pursuant to Section
5.1 of the Partnership Agreement, of the
stated value of $50 per Series B
Preferred Unit, commencing on the date of
issuance of such Series B Preferred
Unit, (iii) the term "SUBSIDIARY" shall
mean with respect to any person, any
corporation, partnership, limited liability
company, joint venture or other
entity of which a majority of (x) voting
power of the voting equity securities
or (y) the outstanding equity interests, is
owned, directly or indirectly, by
such person, (iv) the term "PTP" shall mean
a "publicly traded partnership"
within the meaning of Section 7704 of the
Code, and (v) the term "RIGHTS" shall
mean those rights granted pursuant to that
certain Rights Agreement, dated as of
November 2, 1998 between General Partner
and BankBoston, N.A. Capitalized terms
used herein and not otherwise defined
herein shall have the meanings ascribed to
them in the Partnership Agreement.
(2)
DISTRIBUTIONS.
(a) Payment of Distributions. Subject to the rights of holders
of Parity Preferred Units as to the payment
of distributions, pursuant to
Section 5.1 of the Partnership Agreement,
holders of Series B Preferred Units
shall be entitled to receive, when, as and
if declared by the Partnership acting
through the General Partner, out of
Available Cash, cumulative preferential cash
distributions at the rate per annum of
8.875% of the original Capital
Contribution per Series B Preferred Unit
for the period up to and including
February 23, 2004, and at the rate per
annum of 7.25% of the original Capital
Contribution per Series B Preferred Unit
for the period from and after February
24, 2004. Such distributions shall be
cumulative, shall accrue from the original
date of issuance and will be payable (i)
quarterly (such quarterly periods for
purposes of payment and accrual will be the
quarterly periods ending on the
dates specified in this sentence and not
calendar year quarters) in arrears, on
March 31, June 30, September 30 and
December 31 of each year commencing on March
31, 1999 and, (ii) in the event of (A) an
exchange of Series B Preferred Units
into Series B Preferred Shares (as
hereinafter defined), or (B) a redemption of
Series B Preferred Units, on the exchange
date or redemption date, as applicable
(each a "SERIES B PREFERRED UNIT
DISTRIBUTION PAYMENT DATE"). The holders of the
Series B Preferred Units acknowledge that
all quarterly distributions have been
made through and including the quarterly
period ended December 31, 2003. The
amount of the distribution payable for any
period will be computed on the basis
of a 360-day year of twelve 30-day months
(or actual days for any month which is
shorter than a full monthly period), and
for any period shorter than a full
quarterly period for which distributions
are computed, the amount of the
distribution payable will be computed on
the basis of the actual number of days
elapsed in such a 30-day month. The amount
of the distribution payable on March
31, 2004 under the Partnership Agreement
and this Exhibit H shall be $1.0277 per
Series B Preferred Unit, representing the
conversion of the Priority Return from
8.875% per annum to 7.25% per annum during
the quarterly
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period ended on such date, calculated as
follows: (x) the month of January 2004
is counted as a 30-day month with a
Priority Return of 8.875% per annum and the
period from and including February 1, 2004
to and including February 23, 2004 is
counted as a 23-day period of a 29-day
month with a Priority Return of 8.875%
per annum, (y) the period from and
including February 24, 2004 to and including
February 29, 2004 is counted as a six-day
period of a 29-day month with a
Priority Return of 7.25% per annum and the
month of March 2004 is counted as a
30-day month with a Priority Return of
7.25% per annum, and (z) the amounts for
the periods described in the preceding
clauses (x) and (y) were added to obtain
the distribution payable per Series B
Preferred Unit on March 31, 2004. If any
date on which distributions are to be made
on the Series B Preferred Units is
not a Business Day (as defined herein),
then payment of the distribution to be
made on such date will be made on the next
succeeding day that is a Business Day
(and without any interest or other payment
in respect of any such delay) except
that, if such Business Day is in the next
succeeding calendar year, such payment
shall be made on the immediately preceding
Business Day, in each case with the
same force and effect as if made on such
date. Distributions on the Series B
Preferred Units will be made to the holders
of record of the Series B Preferred
Units on the relevant record dates to be
fixed by the Partnership acting through
the General Partner, which record dates
shall in no event exceed fifteen (15)
Business Days prior to the relevant Series
B Preferred Unit Distribution Payment
Date (the "SERIES B PREFERRED UNIT
PARTNERSHIP RECORD DATE").
The term "BUSINESS DAY" shall mean each day, other than a
Saturday or a Sunday, which is not a day on
which banking institutions in New
York, New York are authorized or required
by law, regulation or executive order
to close.
No distributions on the Series B Preferred Units shall be
declared by the General Partner or paid or
set apart for payment by the
Partnership at such time as the terms and
provisions of any agreement of the
General Partner or the Partnership,
including any agreement relating to
indebtedness of either of them, prohibits
such declaration, payment, or setting
apart for payment or provides that such
declaration, payment or setting apart
for payment would constitute a breach
thereof or a default thereunder, or if
such declaration or payment shall be
restricted or prohibited by law.
(b)
Distributions Cumulative. Distributions on the Series
B Preferred Units will accrue whether or
not the terms and provisions of any
agreement of the Partnership, including any
agreement relating to its
indebtedness at any time prohibit the
current payment of distributions, whether
or not the Partnership has earnings,
whether or not there are funds legally
available for the payment of such
distributions and whether or not such
distributions are authorized. Accrued but
unpaid distributions on the Series B
Preferred Units will accumulate as of the
Series B Preferred Unit Distribution
Payment Date on which they first become
payable. Distributions on account of
arrears for any past distribution periods
may be declared and paid at any time,
without reference to a regular Series B
Preferred Unit Distribution Payment Date
to holders of record of the Series B
Preferred Units on the record date fixed by
the Partnership acting through the General
Partner which date shall not exceed
fifteen (15) Business Days prior to the
payment date. Accumulated and unpaid
distributions will not bear interest.
(c) Priority
as to Distributions.
(i) So long as
any Series B Preferred Units are
outstanding, no distribution of cash or
other property shall be authorized,
declared, paid or set apart for payment on
or with respect to any class or
series of Partnership Interest ranking
junior as to the payment of distributions
or rights upon a voluntary or involuntary
liquidation, dissolution or winding-up
of the Partnership to the Series B
Preferred Units (collectively, "JUNIOR
UNITS"), nor shall any cash or other
property be set aside for or applied to the
purchase, redemption or other acquisition
for consideration of any Series B
Preferred Units, any Parity Preferred Units
or any Junior Units or Rights in
respect of Junior Units, unless, in each
case, all distributions accumulated on
all Series B Preferred Units and all
classes and series of outstanding Parity
Preferred Units (or, in the event of the
liquidation of the Partnership, to the
extent of respective Capital Account
balances of holders of such Series B
Preferred Units and outstanding Parity
Preferred Units in accordance with
Section 13.2 of the Partnership Agreement)
have been paid in full. The foregoing
sentence will not prohibit (a)
distributions payable solely in Junior Units (or
options, warrants or rights to subscribe
for Junior Units), (b) the conversion
of Junior Units or Parity Preferred Units
into Partnership Interests ranking
junior to the Series B Preferred Units as
to distributions and rights upon
voluntary or involuntary liquidation,
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dissolution or winding up of the
Partnership, or (c) the redemption of
Partnership Interests corresponding to any
Series B Preferred Shares, Parity
Preferred Shares or Junior Shares to be
purchased by the General Partner
pursuant to Article VI of the Declaration
of Trust of the General Partner (the
"CHARTER") to preserve the General
Partner's status as a real estate investment
trust, provided that such redemption shall
be upon the same terms as the
corresponding purchase pursuant to Article
VI of the Charter.
(ii)
So long as distributions have not been paid
in full (or a sum sufficient for such full
payment is not irrevocably deposited
in trust for payment) upon the Series B
Preferred Units, all distributions
authorized and declared on the Series B
Preferred Units and all classes or
series of outstanding Parity Preferred
Units shall be authorized and declared so
that the amount of distributions authorized
and declared per Series B Preferred
Unit and such other classes or series of
Parity Preferred Units shall in all
cases bear to each other the same ratio
that accrued distributions per Series B
Preferred Unit and such other classes or
series of Parity Preferred Units (which
shall not include any accumulation in
respect of unpaid distributions for prior
distribution periods if such class or
series of Parity Preferred Units do not
have cumulative distribution rights) bear
to each other, except as would be made
upon a liquidation of the Partnership and a
distribution of its assets in
accordance with Section 13.2 of the
Partnership Agreement.
(d) No Further
Rights. Holders of Series B Preferred
Units shall not be entitled to any
distributions, whether payable in cash, other
property or otherwise, in excess of the
full cumulative distributions described
herein.
(3)
LIQUIDATION PROCEEDS.
(a) Upon voluntary or involuntary liquidation, dissolution or
winding-up of the Partnership,
distributions on the Series B Preferred Units
shall be made in accordance with Section
13.2 of the Partnership Agreement.
(b) Notice.
Written notice of any such voluntary or
involuntary liquidation, dissolution or
winding-up of the Partnership, stating
the payment date or dates when, and the
place or places where, the amounts
distributable in such circumstances shall
be payable, shall be given by (i) fax
and (ii) by first class mail, postage
pre-paid, not less than thirty (30) and
not more than sixty (60) days prior to the
payment date stated therein, to each
record holder of the Series B Preferred
Units at the respective addresses of
such holders as the same shall appear on
the transfer records of the
Partnership.
(c) No Further
Rights. After payment of the full amount
of the liquidating distributions to which
they are entitled, the holders of
Series B Preferred Units will have no right
or claim to any of the remaining
assets of the Partnership.
(d)
Consolidation, Merger or Certain Other Transactions.
The voluntary sale, conveyance, lease,
exchange or transfer (for cash, shares,
securities or other consideration) of all
or substantially all of the property
or assets of the General Partner to, or the
consolidation or merger or other
business combination of the Partnership
with or into, any Company, trust or
other entity (or of any Company, trust or
other entity with or into the
Partnership) shall not be deemed to
constitute a liquidation, dissolution or
winding-up of the Partnership.
(4)
REDEMPTION.
(a) Right of Optional Redemption. Except as provided in
Section (4)(d) and Section (6)(a)(ii), the
Series B Preferred Units may not be
redeemed prior to February 24, 2009. On or
after such date, the Partnership
shall have the right to redeem the Series B
Preferred Units, in whole or in
part, at any time or from time to time,
upon not less than 30 nor more than 60
days' written notice, at a redemption
price, payable in cash, equal to the
Capital Account balance of the holders of
Series B Preferred Units (the "SERIES
B REDEMPTION PRICE"); provided, however,
that no redemption pursuant to this
SECTION will be permitted if the Series B
Redemption Price does not equal or
exceed the original Capital Contribution of
such holder plus the cumulative
Priority Return, whether or not declared,
to the redemption date to the extent
not previously distributed. If fewer than
all of the outstanding Series
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B Preferred Units are to be redeemed, the
Series B Preferred Units to be
redeemed shall be selected pro rata (as
nearly as practicable without creating
fractional units).
(b) Limitation
on Redemption.
(i) The Series
B Redemption Price (other than
the portion thereof consisting of
accumulated but unpaid distributions) will be
payable solely out of the sale proceeds of
capital shares of the General
Partner, which will be contributed by the
General Partner to the Partnership as
additional capital contribution, or out of
the sale of limited partner interests
in the Partnership and from no other
source. For purposes of the preceding
sentence, "capital shares" means any equity
securities (including Common Shares
and Preferred Shares (as such terms are
defined in the Charter)), shares,
participation or other ownership interests
(however designated) and any rights
(other than debt securities convertible
into or exchangeable for equity
securities) or options to purchase any of
the foregoing.
(ii)
The Partnership may not redeem fewer than
all of the outstanding Series B Preferred
Units unless all accumulated and
unpaid distributions have been paid on all
Series B Preferred Units for all
quarterly distribution periods terminating
on or prior to the date of
redemption.
(c) Procedures
for Redemption.
(i) Notice of
redemption will be (A) faxed, and
(B) mailed by the Partnership, by certified
mail, postage prepaid, not less than
30 nor more than 60 days prior to the
redemption date, addressed to the
respective holders of record of the Series
B Preferred Units at thei
