EXHIBIT 10.37
ONE HUNDRED FORTY-FIFTH AMENDMENT
TO THE
SECOND AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT
OF
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
THIS ONE HUNDRED FORTY-FIFTH AMENDMENT TO THE SECOND AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT OF SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
(this "AMENDMENT") is made and entered into as of January 31, 2002, by and
between SUN COMMUNITIES, INC., a Maryland corporation (the "GENERAL PARTNER"),
as the general partner of SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP, a
Michigan limited partnership (the "PARTNERSHIP"), and BAY AREA LIMITED
PARTNERSHIP, a Michigan limited partnership (the "SERIES B-2 PREFERRED
PARTNER").
RECITALS
A. The Series B-2 Preferred Partner and the Partnership are parties to
that certain Contribution Agreement, of even date herewith (the "Contribution
Agreement"), pursuant to which the Series B-2 Preferred Partner has agreed to
contribute to the Partnership the Transferred Membership Interests (as defined
in the Contribution Agreement) in consideration for the issuance by the
Partnership of Series B-2 Preferred Units (as hereinafter defined).
B. The signatories hereto desire to amend that certain Second Amended and
Restated Limited Partnership Agreement of Sun Communities Operating Limited
Partnership, dated as of April 30, 1996, as amended by those certain amendments
numbered one through one hundred forty-four (collectively, as amended, the
"Agreement") as set forth herein; any capitalized term not defined herein shall
have the respective meaning ascribed to it in the Agreement.
C. Section 11 of the Agreement authorizes the General Partner, as the
holder of more than fifty percent (50%) of the OP Units, to amend the Agreement.
NOW, THEREFORE, in consideration of the foregoing, of the mutual promises
set forth herein, and of other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree to continue the Partnership and amend the Agreement as
follows:
1. Admission of New Partners. As of the date hereof, the Series B-2
Preferred Partner has contributed the Transferred Membership Interests, with a
net agreed upon value of [$15,000,000], to the Partnership in exchange for the
assumption of the Comerica Debt and the ▇▇▇▇▇ Debt (as such terms are defined in
the Contribution Agreement) and the issuance to the Series B-2 Preferred Partner
of 100,000 Series B-2 Preferred Units. The Series B-2 Preferred Units issued to
the Series B-2 Preferred Partner have been duly issued and fully paid. The
Series B-2 Preferred Partner is hereby admitted to the Partnership as a new
Limited Partner, and by execution of this Amendment the Series B-2 Preferred
Partner has agreed to be bound by all of the terms and conditions of the
Agreement, as amended hereby, and hereby acknowledges receipt of a copy of the
Agreement. Exhibit A of the Agreement is hereby deleted in its entirety and is
replaced with EXHIBIT A to this Amendment.
2. Sections 3.1 and 3.2. Sections 3.1 and 3.2 of the Agreement are hereby
deleted in their entirety and replaced with the following:
"3.1 OP UNITS
The Partners' interests in the Partnership are expressed in terms of
OP Units and each Partner has been issued OP Units corresponding to the
agreed value of its capital contribution. OP Units consist of Common OP
Units, Preferred OP Units, Series A Preferred Units, Series B Preferred
Units, Series B-1 Preferred Units and Series B-2 Preferred Units.
3.2 COMMON OP UNITS
The holders of the Common OP Units shall be entitled to receive
distributions in accordance with Section 4.3, after payment of all accrued
(i) Preferred Dividends, (ii) Series A Priority Return, (iii) Series B
Priority Return, (iv) Series B-1 Priority Return and (v) Series B-2
Priority Return. No distribution shall be made in respect of Common OP
Units while any accrued (i) Preferred Dividends, (ii) Series A Priority
Return, (iii) Series B Priority Return, (iv) Series B-1 Priority Return or
(v) Series B-2 Priority Return remains unpaid unless all such unpaid
amounts are paid simultaneously with such distribution."
3. Section 4.2 (a)(v) of the Agreement is hereby deleted in its entirety
and replaced with the following:
"(v) fifth, with respect to OP Units other than Series A Preferred
Units, pro rata in proportion to the number of OP Units other than Series
A Preferred Units, held by each such Partner as of the last day of the
period for which such allocation is being made; provided, however, that
the profits allocated to any Preferred OP Units, Series B Preferred Units,
Series B-1 Preferred Units and Series B-2 Preferred Units pursuant to this
Section 4.2(b)(v) for any calendar year shall not exceed the amount of
Preferred Dividends, Series B Priority Return, Series B-1 Priority Return
and Series B-2 Priority Return, respectively, thereon for that calendar
year, and any such excess profits remaining after the application of such
limitation shall be allocated to the holders of the Common OP Units, pro
rata."
4. Section 8.2(a) of the Agreement is hereby deleted in its entirety and
replaced with the following:
"8.2 LIQUIDATING DISTRIBUTIONS; RESTORATION OF CAPITAL ACCOUNT DEFICITS
Upon the liquidation of the Partnership or any Partner's interest in
the Partnership, within the meaning of the Allocation Regulations:
(a) The capital accounts of the holders of the OP Units shall be
adjusted to reflect the manner in which any unrealized income, gain, loss
and deduction inherent in the Partnership's property, which has not
previously been reflected in the Partners' capital accounts, would be
allocated among the Partners if there were a taxable disposition of such
property at fair market value on the date of distribution. Any resulting
increase in the Partners' capital accounts shall be allocated (i) first to
the holders of the Preferred OP Units and Series A Preferred Units in
proportions and amounts sufficient to bring their respective capital
account balances up to the amount of the Issue Prices of their respective
Preferred OP Units and Series A Preferred Units plus accrued and unpaid
Preferred Dividends or Series A Priority Return, as the case may be,
thereon, (ii) second to the holders of the Series B Cumulative Preferred
Units in proportions and amounts sufficient to bring their respective
capital account balances up to the amount of the Issue Price of the Series
B Cumulative Preferred Units plus accrued and unpaid Series B Priority
Return, Series B-1 Priority Return and Series B-2 Priority Return, as
applicable, thereon, and (iii)
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third (if any) to the Common OP Units. Any resulting decrease in the
Partners' capital accounts shall first be allocated (i) first to the
holders of the Common OP Units in proportions and amounts sufficient to
reduce their respective capital account balances to zero, (ii) second to
the holders of Series B Cumulative Preferred Units in proportions and
amounts sufficient to reduce their respective capital account balances to
zero, (iii) third to the holders of the Preferred OP Units and Series A
Preferred Units in proportions and amounts sufficient to reduce their
respective capital account balances to zero, and (iv) (if any) to the
General Partner. Liquidating distributions shall be made in accordance
with the positive capital account balances of the Partners, after giving
effect to such adjustment and other capital account adjustments for the
current year, as provided in the Allocation Regulations.
5. Section 14. Section 14 of the Agreement is hereby amended as follows:
(a) The second sentence of the definition of "OP UNITS" is hereby
deleted in its entirety and replaced with the following: "OP Units consist
of Common OP Units, Preferred OP Units, Series A Preferred Units, Series B
Preferred Units, Series B-1 Preferred Units and Series B-2 Preferred
Units."
(b) The following new definitions are inserted in Section 14
(Definitions) so as to preserve alphabetical order, and the definition of
"Series B Preferred Unit Distribution Payment Date" and "Series B Default"
shall be deleted:
"CHANGE IN CONTROL" shall have the meaning set forth therefor
in Section 17.5(c) hereof.
"SERIES B-2 ISSUANCE DATE" shall mean January 31, 2002.
"SERIES B-2 PREFERRED PARTNER" means Bay Area Limited
Partnership, a Michigan limited partnership, and its successors and
permitted assigns.
"SERIES B-2 PREFERRED UNITS" shall have the meaning set forth
therefor in Section 17.2 hereof.
"SERIES B-2 PRIORITY RETURN" shall have the meaning set forth
therefor in Section 17.1 hereof.
"SERIES B-2 REDEMPTION PRICE" shall mean $45 per Series B-2
Preferred Unit redeemed.
6. Section 17 of the Agreement is hereby deleted in its entirety and
replaced with the following:
"17. SERIES B CUMULATIVE PREFERRED UNITS.
SECTION 17.1 DEFINITIONS. The term "SERIES B CUMULATIVE PREFERRED
UNITS" shall mean the Series B Preferred Units, the Series B-1 Preferred
Units, and the Series B-2 Preferred Units. The term "SERIES B PARITY
PREFERRED UNITS" shall mean any class or series of OP Units of the
Partnership now or hereafter authorized, issued or outstanding and
expressly designated by the Partnership to rank on parity with the Series
B Preferred Units, Series B-1 Preferred Units, and Series B-2 Preferred
Units with respect to distributions and rights upon voluntary or
involuntary liquidation, winding-up or dissolution of the Partnership. The
term "SERIES B
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PRIORITY RETURN" shall mean an amount equal to (i) 7.0% per annum for the
First 24 Month Period, (ii) 7.5% per annum for the Second 24 Month Period,
(iii) 8.0% per annum for the First 12 Month Period, and (iv) 9.0% per
annum for the Second 12 Month Period (determined on the basis of a 365 day
year), of the stated amount of $100.00 per Series B Preferred Unit
multiplied by the number of outstanding Series B Preferred Units,
cumulative to the extent not distributed for any given distribution period
pursuant to Section 4.3 hereof. The term "SERIES B-1 PRIORITY RETURN"
shall mean an amount equal to (i) 6.85% per annum commencing on and
including the Series B-1 Issuance Date and ending on and including October
15, 2003, (ii) 7.2% per annum commencing on and including October 16, 2003
and ending on and including ▇▇▇▇▇ ▇▇, ▇▇▇▇, (▇▇▇) 7.6% per annum
commencing on and including April 16, 2006 and ending on and including
April 15, 2008, (iv) 8.36% per annum commencing on and including April 16,
2008 and ending on and including April 15, 2010, and (v) 9.19% per annum
thereafter (determined on the basis of a 365 day year), of the stated
amount of $100.00 per Series B-1 Preferred Unit multiplied by the number
of outstanding Series B-1 Preferred Units, cumulative to the extent not
distributed for any given distribution period pursuant to Section 4.3
hereof. The term "SERIES B-2 PRIORITY RETURN" shall mean an amount equal
to (i) 6.0% per annum commencing on and including the Series B-2 Issuance
Date and ending on and including January 31, 2007, and (ii) 7.0% per annum
thereafter (determined on the basis of a 365 day year), of the stated
amount of $45.00 per Series B-2 Preferred Unit multiplied by the number of
outstanding Series B-2 Preferred Units, cumulative to the extent not
distributed for any given distribution period pursuant to Section 4.3
hereof.
SECTION 17.2 DESIGNATION AND NUMBER. A series of OP Units in the
Partnership designated as the "Series B Cumulative Preferred Units" is
hereby established. Of such Series B Cumulative Preferred Units there
shall be designated Series B Preferred Units ("SERIES B PREFERRED UNITS"),
Series B-1 Preferred Units ("SERIES B-1 PREFERRED UNITS") and Series B-2
Preferred Units ("SERIES B-2 PREFERRED UNITS"). The number of Series B
Preferred Units shall be 35,637, the number of Series B-1 Preferred Units
shall be 46,117, and the number of Series B-2 Preferred Units shall be
100,000.
SECTION 17.3 DISTRIBUTIONS.
(a) Payment of Distributions.
(i) Subject to the rights of holders of Series A
Preferred Units, Parity Preferred Units, Preferred OP Units
and Series B Parity Preferred Units as to the payment of
distributions pursuant to Sections 4.3, 8.2 and 16.3 of the
Agreement, holders of Series B Preferred Units, Series B-1
Preferred Units and Series B-2 Preferred Units shall be
entitled to receive, when, as and if declared by the
Partnership acting through the General Partner, out of the
Partnership's available cash, the Series B Priority Return,
Series B-1 Priority Return, and Series B-2 Priority Return,
respectively.
(ii) All 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) in arrears, on March 31, June 30,
September 30 and December 31 of each year, and (ii) in the
event of a redemption of Series B Cumulative Preferred Units,
on the redemption date (each a "SERIES B CUMULATIVE PREFERRED
UNIT DISTRIBUTION PAYMENT DATE"). The amount of the
distribution payable for any period will be computed on the
basis of a 365-day year and for any period shorter than a full
quarterly period for which distributions
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are computed, the amount of the distribution payable will be
computed based on the ratio of the actual number of days
elapsed in such period to the actual number of days in such
quarterly period. If any date on which distributions are to be
made on the Series B Cumulative Preferred Units is not a
Business Day (as defined in Section 14), 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 Cumulative
Preferred Units will be made to the holders of record of the
Series B Cumulative 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
Cumulative Preferred Unit Distribution Payment Date.
(b) Distributions Cumulative. Distributions on the Series B
Cumulative 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
declaration, setting aside for payment or current payment of
distributions, whether or not the Partnership has earnings, whether
or not there are funds legally available for the payment of such of
such distributions and whether or not such distributions are
authorized. Accrued but unpaid distributions on the Series B
Cumulative Preferred Units will accumulate as of the Series B
Cumulative 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 Cumulative Preferred Unit
Distribution Payment Date to holders of record of the Series B
Cumulative 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 Cumulative 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 OP Units of the
Partnership 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
Cumulative Preferred Units (collectively, "SERIES B 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 Cumulative Preferred Units,
any Series B Parity Preferred Units or any Series B Junior
Units, unless, in each case, all distributions accumulated on
all Series B Cumulative Preferred Units and all classes and
series of outstanding Series B Parity Preferred Units have
been paid in full. The foregoing sentence will not prohibit
(a) distributions payable solely in OP Units ranking junior to
the Series B Cumulative Preferred Units as to the payment of
distributions and rights upon a voluntary or involuntary
liquidation, dissolution or winding-up of the Partnership, (b)
the conversion of Series B Junior Units or Series B Parity
Preferred Units into OP Units of the Partnership ranking
junior to the Series B Cumulative Preferred Units as to
distributions and rights upon a voluntary or
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involuntary liquidation, dissolution or winding-up of the
Partnership, or (c) the redemption of OP Units corresponding
to any Junior Stock (as defined in the Series A Articles
Supplementary) to be purchased by the General Partner pursuant
to Article VII of 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 VII 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 immediate payment) upon the Series B
Cumulative Preferred Units, all distributions authorized and
declared on the Series B Cumulative Preferred Units and all
classes or series of outstanding Series B Parity Preferred
Units shall be authorized and declared so that the amount of
distributions authorized and declared per Series B Cumulative
Preferred Unit and such other classes or series of Series B
Parity Preferred Units shall in all cases bear to each other
the same ratio that accrued distributions per Series B
Cumulative Preferred Unit and such other classes or series of
Series B Parity Preferred Units (which shall not include any
accumulation in respect of unpaid distributions for prior
distribution periods if such class or series of Series B
Parity Preferred Units do not have cumulative distribution
rights) bear to each other.
(iii) The Series B Cumulative Preferred Units and any
Series B Parity Preferred Units shall be deemed to be "Junior
Units" as defined in Section 16.3(c) hereof, and so long as
any Series A Preferred Units or Parity 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 the Series B Cumulative Preferred Units or any
Series B Parity Preferred 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 Cumulative Preferred Units or Series B Parity
Preferred Units unless, in each case, all distributions
accumulated on all Series A Preferred Units and all classes
and series of outstanding Parity Preferred Units have been
paid in full.
(d) Distributions on OP Units held by General Partner.
Notwithstanding anything to the contrary herein, distributions on OP
Units held by the General Partner may be made, without preserving
the priority of distributions described in Section 17.3(c)(i) and
(ii), but only to the extent such distributions are required to
preserve the real estate investment trust status of the General
Partner.
(e) No Further Rights. Holders of Series B Cumulative
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.
SECTION 17.4 LIQUIDATION PROCEEDS.
(a) Notice. Written notice of any 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 Cumulative Preferred Units at the respective
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addresses of such holders as the same shall appear on the transfer
records of the Partnership.
(b) No Further Rights. After payment of the full amount of the
liquidating distributions to which they are entitled pursuant to
Section 8.2 hereof, the holders of Series B Cumulative Preferred
Units will have no right or claim to any of the remaining assets of
the Partnership.
(c) Consolidation, Merger or Certain Other Transactions. The
voluntary sale, conveyance, lease, exchange or transfer (for cash,
shares of stock, 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 corporation, trust, partnership,
limited liability company or other entity (or of any corporation,
trust, partnership, limited liability company or other entity with
or into the Partnership) shall not be deemed to constitute a
liquidation, dissolution or winding-up of the Partnership.
SECTION 17.5 REDEMPTION.
(a) Series B Preferred
(i) Mandatory Redemption. Subject to the limitations in
this Section 17.5, the holders of Series B Preferred Units may
request redemption of, and the Partnership shall redeem, for
cash, Series B Preferred Units on the following terms and
subject to the following conditions:
(A) On May 1, 2003 the holders of Series B
Preferred Units may require that the Partnership redeem
an aggregate of 10,000 Series B Preferred Units upon not
less than sixty (60) days prior written notice, at the
Series B Redemption Price.
(B) On May 1, 2004 and May 1, 2005 the holders of
Series B Preferred Units may require that the
Partnership redeem all outstanding Series B Preferred
Units upon not less than sixty (60) days prior written
notice at the Series B Redemption Price.
(C) On May 1, 2006, the Partnership shall redeem
all outstanding Series B Preferred Units at the Series B
Redemption Price.
(ii) Redemption in the Event of a Series B Default. The
Partnership shall redeem, for cash, all outstanding Series B
Preferred Units at the Series B Redemption Price in the event
the Partnership fails to declare and pay on any Series B
Cumulative Preferred Unit Distribution Payment Date the Series
B Priority Return for any reason including the failure to
declare a distribution of the Series B Priority Return (a
"SERIES B DEFAULT"). Such redemption shall occur fifteen (15)
days after written demand of the holders of Series B Preferred
Units is received by the Partnership, provided such notice is
received by the Partnership no later than thirty (30) days
after the Series B Cumulative Preferred Unit Distribution
Payment Date that is the subject of the Series B Default.
Failure of the holders of Series B Preferred Units to timely
give such notice shall terminate the right of the holders of
Series B Preferred Units under this Section
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17.5(a)(ii) to demand redemption with respect to the Series B
Default to which such notice relates, but shall not effect the
rights of the holders of Series B Preferred Units under this
Section 17.5(a)(ii) for any subsequent Series B Default.
(iii) Procedures for Redemption.
(A) Notice of redemption will be (x) faxed and (y)
mailed by the holders of Series B Preferred Units, by
certified mail, postage prepaid, to the Partnership so
that notice is received by the Partnership within the
periods set forth herein and in accordance with the
provisions hereof. Each such notice shall: (1) state the
aggregate number of Series B Preferred Units to be
redeemed and if fewer than all of the outstanding Series
B Preferred Units are to be redeemed, the number of
Series B Preferred Units to be redeemed held by such
holder, which number shall equal such holder's pro rata
share (based on the percentage of the aggregate number
of outstanding Series B Preferred Units the total number
of Series B Preferred Units held by such holder
represents) of the aggregate number of Series B
Preferred Units to be redeemed and (2) refer to the
specific subsection of this Section 17.5 pursuant to
which such redemption is being effected. Any such notice
shall be irrevocable.
(B) By 12:00 noon, New York City time, on the
redemption date, the Partnership will deposit
irrevocably in trust with Boston Equiserve, its transfer
agent (or any successor entity, provided such entity is
a third party, unrelated to the Company and the
Partnership) for the benefit of the Series B Preferred
Units being redeemed funds sufficient to pay the Series
B Redemption Price and will give irrevocable
instructions to such transfer agent and authority to pay
such Series B Redemption Price to the holders of the
Series B Preferred Units upon surrender of the Series B
Preferred Units by such holders at the place designated
by the Partnership. If the Series B Preferred Units are
evidenced by a certificate and if fewer than all Series
B Preferred Units evidenced by any certificate are being
redeemed, a new certificate shall be issued upon
surrender of the certificate evidencing all Series B
Preferred Units, evidencing the unredeemed Series B
Preferred Units without cost to the holder thereof. On
and after the date of redemption, distributions will
cease to accumulate on the Series B Preferred Units or
portions thereof called for redemption, unless the
Partnership defaults in the payment of the Series B
Redemption Price. If any date fixed for redemption of
Series B Preferred Units is not a Business Day, then
payment of the Series B Redemption Price payable 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 falls in the next calendar year, such
payment will be made on the immediately preceding
Business Day, in each case with the same force and
effect as if made on such date fixed for redemption. If
payment of the Series B Redemption Price is improperly
withheld or refused and not paid by the Partnership,
distributions on such Series B Preferred Units will
continue to accumulate from the original redemption date
to the date of payment, in which case the actual payment
date will
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be considered the date fixed for redemption for purposes
of calculating the Series B Redemption Price.
(b) Series B-1 Preferred Units
(i) Mandatory Redemption. Subject to the limitations in
this Section 17.5, during the ninety (90) day period
immediately following (x) each anniversary of the Series B-1
Issuance Date commencing with the fifth anniversary of the
Series B-1 Issuance Date or (y) the Partnership's receipt of
notice of ▇▇▇▇ ▇▇▇▇▇'▇ death, the Series B-1 Preferred Partner
may require redemption of, and the Partnership shall redeem,
for cash, at the Series B-1 Redemption Price, all, but not
less than all, of the Series B-1 Preferred Partner's Series
B-1 Preferred Units upon not less than sixty (60) days' prior
written notice to the Partnership.
(ii) Optional Redemption. At any time after the
expiration of the Election Periods, as defined in (b)(i)
above, immediately following the eleventh anniversary of the
Series B-1 Issuance Date, the Partnership may redeem all
outstanding Series B-1 Preferred Units at the Series B-1
Redemption Price upon not less than fifteen (15) days' prior
written notice to the Series B-1 Preferred Partner.
(iii) Procedures for Redemption.
(A) Notice of redemption will be (x) faxed and (y)
mailed by the Series B-1 Preferred Partner, by certified
mail, postage prepaid, to the Partnership so that notice
is received by the Partnership within the periods set
forth herein and in accordance with the provisions
hereof. Any such notice shall be irrevocable.
(B) By 12:00 noon, New York City time, on the
redemption date, the Partnership will deposit
irrevocably in trust with Boston Equiserve, its transfer
agent (or any successor entity, provided such entity is
a third party, unrelated to the Company and the
Partnership) for the benefit of the Series B-1 Preferred
Partner funds sufficient to pay the Series B-1
Redemption Price and will give irrevocable instructions
to such transfer agent and authority to pay such Series
B-1 Redemption Price to the Series B-1 Preferred Partner
upon surrender of the Series B-1 Preferred Units by the
Series B-1 Preferred Partner at the place designated by
the Partnership. On and after the date of redemption,
distributions will cease to accumulate on the Series B-1
Preferred Units, unless the Partnership defaults in the
payment of the Series B-1 Redemption Price. If any date
fixed for redemption of Series B-1 Preferred Units is
not a Business Day, then payment of the Series B-1
Redemption Price payable 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 falls in
the next calendar year, such payment will be made on the
immediately preceding Business Day, in each case with
the same force and effect as if made on such date fixed
for redemption. If payment of the Series B-1 Redemption
Price is improperly withheld or refused and
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not paid by the Partnership, distributions on such
Series B-1 Preferred Units will continue to accumulate
from the original redemption date to the date of
payment, in which case the actual payment date will be
considered the date fixed for redemption for purposes of
calculating the Series B-1 Redemption Price.
(c) Series B-2 Preferred Units
(i) Mandatory Redemption. Subject to the limitations in
this Section 17.5, during the ninety (90) day period
immediately following (x) the fifth (5th) anniversary of the
Series B-2 Issuance Date, or (y) the death of ▇▇▇▇▇ ▇. ▇▇▇▇▇,
or (z) the occurrence of a Change of Control (as defined
below), the Series B-2 Preferred Partner may require
redemption of, and the Partnership shall redeem, for cash, at
the Series B-2 Redemption Price plus all accrued but unpaid
amounts of Series B-2 Priority Return, all, but not less than
all, of the Series B-2 Preferred Partner's Series B-2
Preferred Units upon not less than thirty (30) days' prior
written notice to the Partnership. Notwithstanding the
foregoing, however, the Series B-2 Preferred Partner shall
have no right to put the Series B-2 Preferred Units to the
Partnership under clauses (y) or (z) of this Section 17.5(c)
prior to the fifth (5th) anniversary of the Series B-2
Issuance Date. For purposes of this Section 17.5, the term
"CHANGE OF CONTROL" means a sale of all or substantially all
of the Partnership's assets, or any merger or consolidation of
the Partnership with or into another entity other than a
merger or consolidation in which the holders of more than
fifty-percent (50%) of the voting securities of the
Partnership outstanding immediately prior to such transaction
continue to hold (either by the voting securities remaining
outstanding or by their being converted into voting securities
of the surviving entity) more than fifty percent (50%) of the
total voting power represented by the voting securities of the
Partnership, or such surviving entity, outstanding immediately
after such transaction.
(ii) Procedures for Redemption.
(A) Notice of redemption will be (x) faxed and (y)
mailed by the Series B-2 Preferred Partner, by certified
mail, postage prepaid, to the Partnership so that notice
is received by the Partnership within the periods set
forth herein and in accordance with the provisions
hereof. Any such notice shall be irrevocable.
(B) By 12:00 noon, New York City time, on the
redemption date, the Partnership will deposit
irrevocably in trust with Boston Equiserve, its transfer
agent (or any successor entity, provided such entity is
a third party, unrelated to the Company and the
Partnership) for the benefit of the Series B-2 Preferred
Partner funds sufficient to pay the Series B-2
Redemption Price and will give irrevocable instructions
to such transfer agent and authority to pay such Series
B-2 Redemption Price to the Series B-2 Preferred Partner
upon surrender of the Series B-2 Preferred Units by the
Series B-2 Preferred Partner at the place designated by
the Partnership. On and after the date of redemption,
distributions will cease to accumulate on the Series B-2
Preferred Units, unless the Partnership defaults in the
payment of the Series B-2 Redemption Price. If any date
fixed for redemption of Series B-2
10
Preferred Units is not a Business Day, then payment of
the Series B-2 Redemption Price payable 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 falls in the next calendar year, such
payment will be made on the immediately preceding
Business Day, in each case with the same force and
effect as if made on such date fixed for redemption. If
payment of the Series B-2 Redemption Price is improperly
withheld or refused and not paid by the Partnership,
distributions on such Series B-2 Preferred Units will
continue to accumulate from the original redemption date
to the date of payment, in which case the actual payment
date will be considered the date fixed for redemption
for purposes of calculating the Series B-2 Redemption
Price.
(d) Limitations on Redemption. Any redemption pursuant to this
Section 17.5 is subject to and limited by the provisions of Section
16.3(c)(i) hereof.
SECTION 17.6 VOTING RIGHTS. Holders of the Series B Cumulative
Preferred Units will not have any voting rights or right to consent to any
matter requiring the consent or approval of the Limited Partners.
SECTION 17.7 TRANSFER RESTRICTIONS. The Series B Cumulative
Preferred Units shall be subject to the provisions of Section 9 of the
Agreement.
SECTION 17.8 CONVERSION AND EXCHANGE RIGHTS.
(a) Series B Preferred Units. The holders of Series B Preferred
Units shall be entitled to convert Series B Preferred Units into Common OP
Units or exchange Series B Preferred Units for shares of the General
Partner's common stock, at their option, on the following terms and
subject to the following conditions:
(i) On May 1, 2002, the holders of Series B Preferred Units
may convert an aggregate of 10,000 Series B Preferred Units into
22,727 Common OP Units or exchange an aggregate of 10,000 Series B
Preferred Units for 22,727 shares of the General Partner's common
stock, or any combination thereof at conversion or exchange rate of
2.272727 Common OP Units or shares of the General Partner's common
stock, as the case may be, for each Series B Preferred Unit (rounded
to the lower whole number), at their option, provided the General
Partner has received at least sixty (60) days prior written notice
of such conversion or exchange, such notice to specify the number of
Common OP Units and number of shares of the General Partner's common
stock to which the Series B Preferred Units are to be converted or
exchanged.
(ii) On each of May 1, 2003, May 1, 2004, May 1, 2005 and May
1, 2006, the holders of Series B Preferred Units may convert all or
any portion (but not less than 10,000) Series B Preferred Units to
Common OP Units or exchange all or any portion (but not less than
10,000) Series B Preferred Units for shares of the General Partner's
common stock, at their option, at a conversion and exchange rate of
2.272727 Common OP Units or shares of the General Partner's common
stock, as the case may be, for each Series B Preferred Unit (rounded
to the lower whole number), provided the General Partner has
received at least sixty (60) days prior written notice of such
conversion or exchange, such notice to specify the number of Common
OP Units and number of shares
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of the General Partner's common stock to which the Series B
Preferred Units are to be converted or exchanged.
(iii) The conversion/exchange rate is subject to adjustment
upon subdivisions, stock splits, stock dividends, combinations and
reclassification of the common stock of the General Partner.
(iv) In case the General Partner shall be a party to any
transaction (including, without limitation, a merger, consolidation,
statutory share exchange, tender offer for all or substantially all
of the General Partner's capital stock or sale of all or
substantially all of the General Partner's assets), in each case as
a result of which the General Partner's common stock will be
converted into the right to receive shares of capital stock, other
securities or other property (including cash or any combination
thereof), each Series B Preferred Unit will thereafter be
convertible or exchangeable into the kind and amount of shares of
capital stock and other securities and property receivable
(including cash or any combination thereof) upon the consummation of
such transaction by a holder of that number of shares of the General
Partner's common stock or fraction thereof into which one Series B
Preferred Unit was convertible or exchangeable immediately prior to
such transaction.
(v) Limitations on Conversion and Exchange. Notwithstanding
anything to the contrary in this Section 17.8(a):
(A) Upon tender of any Series B Preferred Units to the
General Partner pursuant to that Section, the General Partner
may issue cash in lieu of stock to the extent necessary to
prevent the recipient from violating the Ownership Limitations
of Section 2 of Article VII of the Charter, or corresponding
provisions of any amendment or restatement thereof; and
(B) A holder of Series B Preferred Units will not have
the right to exchange Series B Preferred Units for the General
Partner's common stock if (1) in the opinion of counsel for
the General Partner, the General Partner would no longer
qualify or its status would be seriously compromised as a real
estate investment trust under the Internal Revenue Code as a
result of such exchange; or (2) such exchange would, in the
opinion of counsel for the General Partner, constitute or be
likely to constitute a violation of applicable securities
laws. In the event of either such occurrence, the General
Partner shall purchase such holder's Series B Preferred Units
for cash at a purchase price of $100 per Series B Preferred
Unit.
(vi) Reservation of Common Stock. The General Partner shall at
all times reserve and keep available a sufficient number of
authorized but unissued shares of common stock to permit the
exchange of all of the outstanding Series B Preferred Units pursuant
to this Section 17.8.
(b) Series B-2 Preferred Units. The holders of Series B-2 Preferred
Units shall be entitled to convert all, or any portion, of the
Series B-2 Preferred Units into Common OP Units during the ninety
(90) day period immediately following the third (3rd) anniversary of
the Series B-2 Issuance Date, at a conversion price of $45.00 for
each Series B-2 Preferred Unit, provided the General Partner has
received at least thirty (30) days prior
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written notice of such conversion, such notice to specify the number
of Common OP Units into which the Series B-2 Preferred Units are to
be converted.
(c) Procedure for Conversion or Exchange.
(i) Any conversion or exchange described in Section 17.8(a) or
(b) above, shall be exercised pursuant to a notice of conversion or
exchange (the "SERIES B AND SERIES B-2 CONVERSION/EXCHANGE NOTICE")
delivered to the General Partner by the holder who is exercising
such conversion or exchange right, by (A) fax and (B) by certified
mail postage prepaid. The Series B and Series B-2
Conversion/Exchange Notice and certificates, if any, representing
such Series B Preferred Units or Series B-2 Preferred Units, as
applicable, to be converted or exchanged shall be delivered to the
office of the General Partner maintained for such purpose.
Currently, such office is:
Sun Communities, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Any conversion or exchange hereunder shall be effective as of the
close of business on the conversion or exchange date. The holders of
the converted or exchanged Series B Preferred Units and Series B-2
Preferred Units shall be deemed to have surrendered the same to the
Partnership or the General Partner, as the case may be, and the
Partnership or the General Partner, as the case may be, shall be
deemed to have issued Common OP Units or shares of common stock of
the General Partner, as applicable, at the close of business on the
conversion or exchange date.
(d) Payment of Series B and the Series B-2 Priority Return. On the
Series B Cumulative Preferred Unit Distribution Payment Date next
following a conversion or exchange date, the holders of Series B Preferred
Units or Series B-2 Preferred Units, as applicable, which converted or
exchanged on such date shall be entitled to Series B Priority Return or
Series B-2 Priority Return, respectively, in an amount equal to a prorated
portion of the Series B Priority Return or the Series B-2 Priority Return,
as applicable, based on the number of days elapsed from the prior Series B
Cumulative Preferred Unit Distribution Payment Date through, but not
including, the conversion or exchange date.
SECTION 17.9 NO SINKING FUND. No sinking fund shall be established
for the retirement or redemption of Series B Cumulative Preferred Units.
7. Governing Law. This Amendment shall be interpreted and enforced
according to the laws of the State of Michigan.
8. Full Force and Effect. Except as amended by the provisions hereof, the
Agreement, as previously amended, shall remain in full force and effect in
accordance with its terms and is hereby ratified, confirmed and reaffirmed by
the undersigned for all purposes and in all respects.
9. Successors/Assigns. This Amendment shall be binding upon and shall
inure to the benefit of the parties hereto, their respective legal
representatives, successors and assigns.
10. Counterparts. This Amendment may be executed in counterparts, all of
which together shall constitute one agreement binding on all the parties hereto,
notwithstanding that all such parties are not signatories to the original or the
same counterpart. Reproductions (photographic, facsimile or
13
otherwise) of this Amendment may be made and relied upon to the same extent as
though such reproduction was an original.
IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the
day and year first above written.
GENERAL PARTNER:
SUN COMMUNITIES, INC., a Maryland corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Senior Vice President,
Treasurer, Chief Financial Officer,
and Secretary
SERIES B-2 PREFERRED PARTNER:
BAY AREA LIMITED PARTNERSHIP, a Michigan limited
partnership
By: JAM Management Company, a Michigan
corporation, General Partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇, President
14