Exhibit 10.3
Second Amendment to the
Amended and Restated
Agreement
of Limited Partnership
of
LaSalle Hotel Operating Partnership,
L.P.
This Amendment is made as of
September 30, 2003 by and among LaSalle Hotel Properties, a
Maryland real estate investment trust, as the general partner (the
“Trust” or the “General Partner”) of
LaSalle Hotel Operating Partnership, L.P., a Delaware limited
partnership (the “Partnership”), and as
attorney-in-fact for the Persons named on Exhibit A to the
Agreement of Limited Partnership of LaSalle Hotel Operating
Partnership, L.P., dated as of April 29, 1998 (the
“Partnership Agreement”) for the purpose of amending
the Partnership Agreement. Capitalized terms used herein and not
defined shall have the meanings given to them in the Partnership
Agreement.
WHEREAS, the Board of Trustees of
the Trust (the “Board”), adopted certain resolutions by
unanimous written consent September 16, 2003, and the Pricing
Committee adopted certain resolutions on September 23, 2003,
classifying and designating 1,200,000 Preferred Shares (as defined
in the Articles of Amendment and Restatement of Declaration of
Trust of the Trust (the “Declaration of Trust”)) as
Series B Preferred Shares (as defined below);
WHEREAS, the Trust filed Articles
Supplementary to the Declaration of Trust (the “Articles
Supplementary”) with the State Department of Assessments and
Taxation of Maryland on September 26, 2003, establishing a
series of preferred shares, designated Series B Preferred
Shares;
WHEREAS, on September 30, 2003,
the Trust issued 1,000,000 Series B Preferred Shares;
WHEREAS, the General Partner has
determined that, in connection with the issuance of the Series B
Preferred Shares, it is necessary and desirable to amend the
Partnership Agreement to create additional Partnership Units having
designations, preferences and other rights which are substantially
the same as the economic rights of the Series B Preferred
Shares.
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NOW, THEREFORE, in consideration of
the premises and for other good and valuable consideration, the
receipt and sufficiency of which hereby are acknowledged, the
General Partner hereby amends the Partnership Agreement as
follows:
1. Article 1 of the Partnership
Agreement is hereby amended by adding the following
definitions:
“Series B Preferred
Shares” means the 8.375% Series B Cumulative Redeemable
Preferred Shares of Beneficial Interest, $.01 par value per share
(Liquidation Preference $25 per share) of the Trust, with the
preferences, liquidation and other rights, voting powers,
restrictions, limitations as to distributions, qualifications and
terms and conditions of redemption of shares as described in the
Articles Supplementary; and
“Series B Preferred
Units” means the series of Partnership Units representing
units of Limited Partnership Interest designated as the 8.375%
Series B Cumulative Redeemable Preferred Units (Liquidation
Preference $25 per share), with the preferences, liquidation and
other rights, voting powers, restrictions, limitations as to
distributions, qualifications and terms and conditions of
redemption of units as described herein.
2. In accordance with
Section 4.2.A of the Partnership Agreement, set forth below
are the terms and conditions of the Series B Preferred Units hereby
established and issued to the Trust in consideration of the
Trust’s contribution to the Partnership of the net proceeds
from the issuance and sale of the Series B Preferred Shares by the
Trust:
A. Designation and Number. A
series of Partnership Units, designated as Series B Preferred
Units, is hereby established. The number of Series B Preferred
Units shall be 1,200,000.
B. Rank. The Series B
Preferred Units will, with respect to distribution rights and
rights upon liquidation, dissolution or winding up of the
Partnership, rank (a) senior to the Class A Units, Class
B Units and to all Partnership Interests the terms of which
specifically provide that such Partnership Interests shall rank
junior to such Series B Preferred Units; (b) on a parity with
all Partnership Interests issued by the Partnership, other than
those Partnership Interests referred to in clauses (a) and
(c); and (c) junior to all Partnership Interests issued by the
Partnership the terms of which specifically provide that such
Partnership Interests shall rank senior to the Series B Preferred
Units.
C. Distributions.
(i) Pursuant to Section 5.1 of
the Partnership Agreement, holders of Series B Preferred Units
shall be entitled to receive, out of Available Cash, cumulative
preferential cash distributions at the rate of eight and
three-eighths percent (8.375%) per annum of the twenty-five
dollars ($25.00) per share liquidation preference of the Series B
Preferred Units (equivalent to a fixed annual amount of $2.09375
per unit). Distributions on the Series B Preferred Units shall
accumulate on a daily basis and be cumulative from (but excluding)
September 30, 2003 and be payable quarterly in equal amounts
in arrears on the fifteenth day of January, April, July, and
October of each year, beginning on January 15, 2003 or, if not
a Business Day, the next succeeding Business Day, or such other day
as the General Partner may determine (each, a “Series B
Preferred Unit Distribution Payment Date”). Any distribution
(including the initial distribution) payable on the Series B
Preferred Units for any partial distribution period shall be
prorated and computed on the basis of a 360-day year consisting of
twelve 30-day months.
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(ii) No distribution on
th
