Exhibit 10.1
First Amendment to the
Amended and Restated Agreement
of Limited Partnership
of
LaSalle Hotel Operating Partnership, L.P.
This Amendment is made as of March 6, 2002 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 on April 27, 1999, September
7, 2001 and February 27, 2002, and the Ad Hoc Pricing Committee adopted
certain resolutions on February 28, 2002, classifying and designating
4,000,000 Preferred Shares (as defined in the Articles of Amendment and
Restatement of Declaration of Trust of the Trust (the "Declaration of Trust"))
as Series A 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 March 4, 2002, establishing a series
of preferred shares, designated Series A Preferred Shares;
WHEREAS, on March 6, 2002, the Trust issued 3,480,000 Series A
Preferred Shares;
WHEREAS, the General Partner has determined that, in connection with
the issuance of the Series A 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 A Preferred Shares.
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 A Preferred Shares" means the 10 1/4% Series A 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 A Preferred Units" means the series of Partnership Units
representing units of Limited Partnership Interest designated as the 10 1/4%
Series A 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 A 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 A Preferred Shares by the Trust:
A. Designation and Number. A series of Partnership Units, designated
as Series A Preferred Units, is hereby established. The number of Series A
Preferred Units shall be 4,000,000.
B. Rank. The Series A 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 A 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 A Preferred Units.
C. Distributions.
(i) Pursuant to Section 5.1 of the Partnership Agreement, holders of
Series A Preferred Units shall be entitled to receive, out of Available Cash,
cumulative preferential cash distributions at the rate of ten and one quarter
percent (10 1/4%) per annum of the twenty-five dollars ($25.00) per share
liquidation preference of the Series A Preferred Units (equivalent to a fixed
annual amount of $2.5625 per unit). Distributions on the Series A Preferred
Units shall accumulate on a daily basis and be cumulative from (but excluding)
March 6, 2002 and be payable quarterly in equal amounts in arrears on the
fifteenth day of January, April, July, and October of each year, beginning on
April 15, 2002 or, if not a Business Day, the next succeeding Business Day, or
such other day as the General Partner may determine (each, a "Series A
Preferred Unit Distribution Payment Date"). Any distribution (including the
initial distribution) payable on the Series A 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.
2
(ii) No distribution on the Series A Preferred Units shall be
authorized by the Board or paid or set apart for payment by the Partnership at
such time as the terms and provisions of any agreement of the Partnership,
including any agreement relating to its indebtedness, prohibits such
authorization, payment or setting apart for payment or provides that such
authorization, payment or setting apart for payment would constitute a breach
thereof, or a default thereunder, or if such authorization or payment shall be
restricted or prohibited by law.
(iii) Notwithstanding anything to the contrary contained herein,
distributions with respect to the Series A Preferred Units shall accumulate
whether or not the restrictions referred to in Subsection 2.C.(ii) exist,
whether or not the Partnership has earnings, whether or not there is
sufficient Available Cash for the payment thereof and whether or not such
distributions are authorized. Accumulated but unpaid distributions on the
Series A Preferred Units will accumulate as of the Series A Preferred Unit
Distribution Payment Date on which they first become payable or on the date of
redemption as the case may be.
(iv) If any Series A Preferred Units are outstanding, no full
distributions will be authorized or paid or set apart for payment on any
Partnership Interests of the Partnership of any other class or series ranking,
as to distributions, on a parity with or junior to the Series A Preferred
Units unless full cumulative distributions have been or contemporaneously are
authorized and paid or authorized and a sum sufficient for the payment thereof
set apart for such payment on the Series A Preferred Units for all past
distribution periods and the then current distribution period. When
distributions are not paid in full (or a sum sufficient for such full payment
is not so set apart) upon the Series A Preferred Units and all other
Partnership Interests ranking on a parity, as to distributions, with the
Series A Preferred Units , all distributions authorized, paid or set apart for
payment upon the Series A Preferred Units and all other units ranking on a
parity, as to distributions, with the Series A Preferred Units shall be
authorized and paid pro rata or authorized and set apart for payment pro rata
so that the amount of distributions authorized per Series A Preferred Unit and
each such other Partnership Interest shall in all cases bear to each other the
same ratio that accumulated distributions per Series A Preferred Unit and
other Partnership Interest (which shall not include any accumulation in
respect of unpaid distributions for prior distribution periods if such
Partnership Interests do not have a cumulative distribution) bear to each
other. No interest, or sum of money in lieu of interest, shall be payable in
respect of any distribution payment or payments on Series A Preferred Units
which may be in arrears.
(v) Except as provided in subsection 2.C.(iv), unless full
cumulative distributions on the Series A Preferred Units have been or
contemporaneously are authorized and paid or authorized and a sum sufficient
for the payment thereof is set apart for payment for all past distribution
periods and the then current distribution period, no distributions (other than
in Partnership Interests ranking junior to the Series A Preferred Units as to
distributions and upon liquidation) shall be authorized or paid or set aside
for payment nor shall any other distribution be authorized or made upon the
Class A Units, Class B Units, or any other Partnership Interests ranking
3
junior to or on a parity with the Series A Preferred Units as to distributions
or upon liquidation, nor shall any Class A Units, Class B Units, or any other
Partnership Interests ranking junior to or on a parity with the Series A
Preferred Units as to distributions or upon liquidation be redeemed, purchased
or otherwise acquired directly or indirectly for any consideration (or any
monies be paid to or made available for a sinking fund for the redemption of
any such Partnership Interests) by the Partnership (except by conversion into
or exchange for other Partnership Interests ranking junior to the Series A
Preferred Units as to distributions and upon liquidation, dissolution or
winding up of the affairs of the Partnership or by redemption, purchase or
acquisition of Partnership Interests under incentive, benefit or unit purchase
plans of the Partnership for Employees of the General Partner, the
Partnership, Subsidiaries of the Partnership or any Affiliate of any of them.)
(vi) Holders of Series A Preferred Units shall not be entitled to
any distribution, whether payable in cash, property or Partnership Interests,
in excess of full cumulative distributions on the Series A Preferred Units as
described above. Any distribution payment made on the Series A Preferred Units
shall first be credited against the earliest accumulated but unpaid
distribution due with respect to such units which remains payable.
D. Allocations.
Allocations of the Partnership's items of income, gain, loss and
deduction shall be allocated among holders of Series A Preferred Units in
accordance with Article VI of the Partnership Agreement.
E. Liquidation Preference.
(i) In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the affairs of the Partnership, the holders of
the Series A Preferred Units shall be entitled to receive out of the assets of
the Partnership legally available for distribution to the Partners pursuant to
Section 13.2.A of the Partnership Agreement a liquidation preference in cash
of $25.00 per Series A Preferred Unit, plus an amount equal to all accumulated
and unpaid distributions to the date of payment, before any distribution of
assets is made to holders of Class A Units, Class B Units or any other
Partnership Interests that rank junior to the Series A Preferred Units as to
liquidation rights.
(ii) If upon any such voluntary or involuntary liquidation,
dissolution or winding up of the affairs of the Partnership, the assets of the
Partnership are insufficient to make such full payment to holders of the
Series A Preferred Units and the corresponding amounts payable on all other
Partnership Interests ranking on a parity with the Series A Preferred Units in
the distribution of assets, then the holders of the Series A Preferred Units
and other such Partnership Interests shall share ratably in any such
distribution of assets in proportion to the full liquidating distributions to
which they would otherwise be respectively entitled.
(iii) After payment of the full amount of the liquidating
distributions to which they are entitled, the holders of Series A Preferred
Units shall have no right or claim to any of the remaining assets of the
Partnership.
4
(iv) None of a consolidation or merger of the Partnership with or
into another entity, a merger of another entity with or into the Partnership
or a sale, lease or conveyance of all or substantially all of the
Partnership's property or business shall be considered a liquidation,
dissolution or winding up of the affairs of the Partnership.
F. Redemption.
In connection with redemption by the Trust of any of its Series A
Preferred Shares in accordance with the provisions of the Articles
Supplementary, the Partnership shall provide cash to the Trust for such
purpose which shall be equal to the redemption price (as set forth in the
Articles Supplementary) and one Series A Preferred Unit shall be canceled with
respect to each Series A Preferred Share so redeemed by the Trust (unless
another Conversion Factor is specified under the Partnership Agreement). From
and after the Series A Preferred Share redemption date, the Series A Preferred
Units so canceled shall no longer be outstanding and all rights hereunder, to
distributions or otherwise, with respect to such Series A Preferred Units
shall cease.
3. 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 confirms.
* * * * *
5
IN WITNESS WHEREOF, the undersigned have executed this Amendment as
of the date first set forth above.
LASALLE HOTEL OPERATING PARTNERSHIP, L.P.
By: LaSalle Hotel Properties, a Maryland real
estate investment trust, its General
Partner, and attorney-in-fact of each
Limited Partner
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Financial Officer
6