REPRESENTATIONS AND WARRANTY AGREEMENT
EXHIBIT 10.8
This REPRESENTATIONS AND WARRANTY AGREEMENT (this “Agreement”) is made and entered into as of
March 3, 2010 (the “Effective Date”), by and among Welsh Property Trust, Inc., a Maryland
corporation (the “REIT”), and Welsh Property Trust, L.P., a Delaware limited partnership and
subsidiary of the REIT (the “Operating Partnership”, and collectively with the REIT, the
“Consolidated Entities”) on the one hand, and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇ ▇.
▇▇▇▇ on the other hand (such individuals collectively, the “Principals”).
RECITALS
WHEREAS, through a series of contribution agreements (the “Contribution Agreements”),
effective as of the date hereof, by and between the Operating Partnership and (i) the three
investment funds set forth on Exhibit A-1 hereto (the “Investment Funds”) that collectively
own, directly or indirectly through 26 limited liability companies set forth on Exhibit A-1
hereto (the “Fund Entities”) , in whole or, with respect to Welsh US Real Estate Fund, LLC, in
part, 33 real property investments and related assets, one mortgage interest, one parcel of vacant
land and the right to acquire one additional real property investment and related assets, as set
forth on Exhibit B-1 (the “Fund Properties”), for which Welsh Companies, LLC or other
affiliates of the Principals (collectively, “Welsh”) serve as the manager, (ii) the owners of the
48 limited liability companies and limited partnerships set forth on Exhibit A-2 (the
“Non-Fund Entities”) that collectively own, directly or indirectly, in whole or in part, 32 real
property investments and related assets, as set forth on Exhibit B-2 (the “Non-Fund
Properties” and, together with the Fund Properties and the JV Properties (defined below), the
“Properties”), for which Welsh serves as the manager, and (iii) the Principals, as owners of (A)
the companies set forth on Exhibit A-3 (collectively, the “Service Companies”) that have
historically performed a variety of services for the Properties (the “Service Business”), and (B)
the interest (the “JV Interest”) in the companies set forth on Exhibit A-4 (the “JV
Companies”) that own, directly or indirectly 14 real property investments and related assets, as
set forth on Exhibit B-3 (the “JV Properties”), the Operating Partnership is acquiring
ownership of the Service Companies, the JV Interest and an indirect interest in the Properties in
connection with the proposed initial public offering (“IPO”) of the common stock, par value $.01
per share, of the REIT (the “REIT Shares”).
WHEREAS, the Principals, or their affiliates, own an equity interest in and control, either
directly or indirectly, all of the Non-Fund Entities, other than the Non-Fund Entities set forth on
Exhibit A-5. The Non-Fund Entities set forth on Exhibit A-5 are referred to herein
as the “Outside Entities” and the remaining Non-Fund Entities, together with the Service Companies,
the JV Companies and the Fund Entities, are referred to herein as the “Principal Controlled
Entities.”
WHEREAS, the Non-Fund Entities set forth on Exhibit A-6 hereto (the “Newly Formed
Entities”) will be formed after the Effective Date, but prior to the Closing Date, and certain
properties set forth on Exhibit A-6 hereto, or assets related thereto, will be contributed
to such Newly Formed Entities by the existing entities set forth on Exhibit A-6 hereto (the
“Existing Non-Fund Entities”).
WHEREAS, pursuant to the Contribution Agreements, the Operating Partnership will be issuing
units of limited partner interest in the Operating Partnership (“OP Units”) to the Pre-Formation
Participants for their equity interests in the Outside Entities and the Principal Controlled
Entities; and
WHEREAS, in order to induce the Operating Partnership to enter into the Contribution
Agreements, the Principals have agreed to provide certain representations or warranties with
respect to the Principal Controlled Entities and the Properties, as set forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and the representations, warranties,
covenants and other terms contained in this Agreement, the parties hereto, intending to be legally
bound hereby, agree as follows:
ARTICLE I
REPRESENTATION AND WARRANTIES
Except as disclosed in the PPM, each of the Principals hereby represents and warrants to the
Consolidated Entities that the statements contained in this Article I are true and correct as of
the Effective Date and, except as disclosed in the Prospectus, each of the Principals hereby
represents and warrants to the Consolidated Entities that the statements contained in this Article
I are true and correct as of the Closing Date. For purposes of this Article I and the
representations and warranties made (i) as of the Effective Date, the term “Principal Controlled
Entities” shall exclude the Newly Formed Entities, but shall include the Existing Non-Fund Entities
(other than the Outside Entities noted with an “*” on Exhibit A-6); and (ii) as of the
Closing Date, the term “Principal Controlled Entities” shall include both the Newly Formed
Entities, and the Existing Non-Fund Entities.
Section 1.01 ORGANIZATION; AUTHORITY.
(a) Each of the Principal Controlled Entities has been duly organized and is validly
existing under the Laws of its jurisdiction of organization and has all requisite power and
authority to enter into each agreement or other document contemplated by the Contribution
Agreements and to carry out the transactions contemplated thereby, and to own, lease and/or
operate each of its Properties and to carry on its business as presently conducted. Each
such Principal Controlled Entity and each of its Subsidiaries, to the extent required under
applicable Laws, is qualified to do business and is in good standing in each jurisdiction in
which the nature of its business or the character of its Properties make such qualification
necessary, other than such failures to be so qualified as would not, individually or in the
aggregate, reasonably be expected have a Material Adverse Effect.
(b) Exhibit B-1 hereto (with respect to the Investment Funds), Exhibit
B-2 hereto (with respect to the Non-Fund Entities, other than the Outside Entities) and
Exhibit B-3 hereto (with respect to the JV Companies) sets forth, as of the
Effective Date (i) each Subsidiary of each Principal Controlled Entity, (ii) the ownership
interests of
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such Principal Controlled Entity in such Subsidiary, (iii) if not wholly owned by such
Principal Controlled Entity, the identity and ownership interest of each of the other owners
of such Subsidiary, and (iv) each Property owned or leased pursuant to a ground lease by
such Principal Controlled Entity or such Subsidiary. To the Principal’s Knowledge, no
Outside Entity owns any interest in any real property investment or related asset, other
than an interest in one or more of the Properties. Each Subsidiary of each Principal
Controlled Entity has been duly organized and is validly existing under the Laws of its
jurisdiction of organization, and has all power and authority to own, lease and/or operate
its Properties and to carry on its business as presently conducted. Each Subsidiary of each
Principal Controlled Entity, to the extent required under applicable Laws, is qualified to
do business and is in good standing in each jurisdiction in which the nature of its business
or the character of its Properties make such qualification necessary, other than such
failures to be so qualified as would not, individually or in the aggregate, reasonably be
expected have a Material Adverse Effect.
Section 1.02 DUE AUTHORIZATION. The execution, delivery and performance by
each Principal Controlled Entity of each agreement or other document contemplated by the
Contribution Agreements to which it is a party have been duly and validly authorized by all
necessary actions required of such Principal Controlled Entity. Each agreement, document
and instrument contemplated by the Contribution Agreements and executed and delivered by or
on behalf of each Principal Controlled Entity constitutes, or when executed and delivered
will constitute, the legal, valid and binding obligation of such Principal Controlled
Entity, each enforceable against such Principal Controlled Entity in accordance with its
terms, subject to applicable bankruptcy, insolvency, moratorium or other similar Laws
relating to creditors’ rights and general principles of equity.
Section 1.03 CAPITALIZATION. Exhibit A to the Contribution Agreements sets
forth, with respect to each Principal Controlled Entity other than the Existing Non-Fund
Entities and the Newly Formed Entities, the ownership of each such Principal Controlled
Entity as of the Effective Date and as of the Closing Date and, with respect to the Newly
Formed Entities, the ownership of each such Newly Formed Entity as of the Closing Date. All
of the issued and outstanding equity interests of such Principal Controlled Entity (other
than the Existing Non-Fund Entities) are validly issued and, to the Principal’s Knowledge,
are not subject to preemptive rights.
Section 1.04 LICENSES AND PERMITS. To the Principal’s Knowledge, all notices,
licenses, permits, certificates and authorizations required for the continued use,
occupancy, management, leasing and operation of the Properties and for the business and
operations of the Service Business have been obtained or can be obtained without material
cost, are in full force and effect, are in good standing, and are assignable to the extent
required in connection with the transactions contemplated by the Contribution Agreements, in
each case other than those notices, licenses, permits, certificates and authorizations the
failure of which to obtain would not, individually or in the aggregate, have a material
adverse effect on the business or operations of any Property or the Service Business that
would reasonably be expected to exceed the Threshold Amount. To the Principal’s Knowledge,
no Principal Controlled Entity or any of their Subsidiaries,
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nor any third party has taken any action that (or failed to take any action the
omission of which) would result in the revocation of any such notice, license, permit,
certificate or authorization where such revocation or revocations would, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect. No Principal
Controlled Entity or any of their Subsidiaries has received any written notice of violation
from any Governmental Authority or written notice of the intention of any entity to revoke
any of them, that in each case has not been cured or otherwise resolved to the satisfaction
of such Governmental Authority and that would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
Section 1.05 LITIGATION. Except for actions, suits or proceedings covered by
the policies of insurance described in Section 1.07(a), to the Principal’s Knowledge, there
is no action, suit or proceeding pending or threatened against any Principal Controlled
Entity or any of their Subsidiaries which, if adversely determined, would, individually or
together with all such other actions, reasonably be expected to have a Material Adverse
Effect. To the Principal’s Knowledge, there is no action, suit or proceeding pending or,
threatened against any Principal Controlled Entity or any of their Subsidiaries which
challenges or impairs the ability of the Principal Controlled Entities to execute or
deliver, or perform its obligations under any of the Contribution Agreements or to
consummate the transactions contemplated hereby and thereby.
Section 1.06 COMPLIANCE WITH LAWS. To the Principal’s Knowledge, the Principal
Controlled Entities and their Subsidiaries have conducted their business in compliance with
all applicable Laws, except for such failures that would not, individually or in the
aggregate, reasonably be expected to require payments by the Principal Controlled Entities
and their Subsidiaries in excess of the Threshold Amount to remedy. No Principal Controlled
Entity or any of its Subsidiaries, or to the Principal’s Knowledge, any third party, has
been informed in writing of any continuing violation of any such Laws or that any
investigation has been commenced and is continuing or is contemplated respecting any such
possible violation, except in each case for violations that would not, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect.
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Section 1.07 PROPERTIES.
(a) Each applicable Principal Controlled Entity or Subsidiary set forth on Schedule
1.07(a) currently is or, in the case of each Newly Formed Entity, will be as of the
Closing Date, insured under a policy of title insurance as the owner of, and the applicable
Principal Controlled Entity or Subsidiary is (i) the owner of, the fee simple estate to each
Property identified on Schedule 1.07(a)(i), and (ii) the holder of a co-tenancy
interest in those properties listed on Schedule 1.07(a)(ii) (and the percentage of
co-tenancy interest held is listed thereon), in each case free and clear of all Liens,
except for Permitted Liens. From the Effective Date through and including the Closing Date,
each applicable Principal Controlled Entity or Subsidiary shall not take or omit to take any
action to cause any Lien to attach to the Property owned by such entity, except for
Permitted Liens.
(b) Except for matters that would not, individually or in the aggregate, have a
material adverse effect on the business or operations of the Properties reasonably valued in
excess of the Threshold Amount, (i) none of the Principal Controlled Entities, any of their
Subsidiaries, nor, to the Principal’s Knowledge, any other party to any agreement affecting
any Property (other than a Lease (as such term is hereinafter defined) for space within such
Property), has given or received any notice of default with respect to any term or condition
of any such agreement, including, without limitation, any ground lease, (ii) no event has
occurred or has been threatened in writing, which with or without the passage of time or the
giving of notice, or both, would, individually or together with all such other events,
constitute a default under any such agreement, or would, individually or together with all
such other events, reasonably be expected to cause the acceleration of any material
obligation of any party thereto or the creation of a Lien upon any asset of any Principal
Controlled Entity or any of their Subsidiaries, except for Permitted Liens, and (iii) all
agreements affecting any Property required for the continued use, occupancy, management,
leasing and operation of such Property (exclusive of space Leases) are valid and binding and
in full force and effect.
(c) To the Principal’s Knowledge, none of the operations, as presently conducted, of
the buildings, fixtures and other improvements comprising a part of the Properties are in
violation of any applicable building code, zoning ordinance or other Law or regulation,
except for such violations that would not, individually or in the aggregate, be reasonably
expected to cost in excess of the Threshold Amount to cure.
(d) To the Principal’s Knowledge, there is no material defect in the condition of (i)
the Properties, (ii) the improvements thereon, (iii) the roof, foundation, load-bearing
walls or other structural elements thereof, or (iv) the mechanical, electrical, plumbing
and, safety systems therein, nor any material damage from casualty or other cause, nor any
soil condition of any nature that will not support all of the improvements thereon. For
this purpose, a “material defect” does not include a defect for which there are insurance
proceeds readily available to correct, or as to which capital expenditures to repair or
replace the defective item have been budgeted and adequately reserved and, in each case, is
actively being corrected.
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(e) Except for matters that would not, individually or in the aggregate, have a
material adverse effect on the business or operations of the Property reasonably valued in
excess of the Threshold Amount, (i) no Principal Controlled Entity or any of their
Subsidiaries, nor, to the Principal’s Knowledge, any other party to any Lease, has given or
received any notice of default with respect to any term or condition of any such Lease, (ii)
to the Principal’s Knowledge, no event has occurred or has been threatened in writing, which
with or without the passage of time or the giving of notice, or both, would, individually or
together with all such other events, constitute a default under any Lease, or would,
individually or together with all such other events, reasonably be expected to cause the
acceleration of any material obligation of any party thereto or the creation of a Lien upon
any asset of the Principal Controlled Entities or any of their Subsidiaries, except for
Permitted Liens, and (iii) each of the leases (and all amendments thereto or modifications
thereof) to which any Principal Controlled Entity or any of their Subsidiaries is a party or
by which any Principal Controlled Entity or any of their Subsidiaries or any Property is
bound or subject (collectively, the “Leases”) is and will be valid and binding and in full
force and effect. None of the Leases require the consent or approval of any party in
connection with the transactions contemplated hereunder.
(f) Schedule 1.07(f) is a true and complete list of all Leases (together with
all amendments and supplements thereto) for more than 100,000 rentable square feet of any
Property (the “Material Leases”). No tenant under any of the Material Leases has an option
or right of first refusal to purchase the premises demised under such Material Leases. The
consummation of the transactions contemplated hereunder will not give rise to any breach,
default or any event which, but for the passage of time or the giving of notice, or both,
would constitute a default under any of the Material Leases. Schedule 1.07(f)
identifies in a true, correct and complete manner the following information as it relates to
all Material Leases: (i) the expiration date; (ii) the rentable square footage demised
thereunder, (iii) the use of the demised premises thereunder; (iv) the annualized base rent
payable thereunder; (v) rent arrearages and other defaults of which the Principals have
Knowledge; (vi) renewal, expansion and purchase options; and (vii) any outstanding tenant
improvement allowances, brokerage commissions or other tenant inducement or similar costs
applicable to such Material Lease.
(g) All equipment, fixtures and personal property located at or on any Property that is
owned by the applicable Principal Controlled Entity or Subsidiary shall remain and not be
removed by the Principal Controlled Entity or Subsidiary prior to the Closing Date, except
for equipment that becomes obsolete or unusable, which may be disposed of or replaced in the
ordinary course of business.
(h) The applicable Principal Controlled Entity or Subsidiary has not incurred any
indebtedness related to the Properties except in each instance for (i) trade payables and
other customary and ordinary expenses in the ordinary course of business; and (ii) financing
or credit arrangements existing as of the Effective Date as set forth on Schedule
3.03(l) hereto.
Section 1.08 INSURANCE. The applicable Principal Controlled Entity or
Subsidiary has in place the public liability, casualty and other insurance coverage with
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respect to each Property and the Service Business as the Principals reasonably deem
necessary. Each of the insurance policies with respect to the Properties and the Service
Business is in full force and effect and all premiums due and payable thereunder have been
fully paid when due. No Principal Controlled Entity nor any Subsidiary has received from
any insurance company any notices of cancellation or intent to cancel any insurance.
Section 1.09 ENVIRONMENTAL MATTERS. Schedule 1.09 is a true and
complete list of all environmental site assessment reports, investigations, remediation or
compliance studies, audits, assessments or similar documents relating to the Properties, and
prepared within ten (10) years prior to the Effective Date and within the possession or
under the control of the Principals, the Principal Controlled Entities or any of their
respective Subsidiaries, or any agent of any of the foregoing (collectively, the
“Environmental Reports”).
(a) To the Principal’s Knowledge, the Principal Controlled Entities, their Subsidiaries
and the Properties are in material compliance with all Environmental Laws;
(b) Neither the Principal Controlled Entities nor their Subsidiaries have received any
written notice from any Governmental Authority or third party alleging that any Principal
Controlled Entity, any of their Subsidiaries or any Property is not in compliance with
applicable Environmental Laws;
(c) To the Principal’s Knowledge, except as disclosed in Schedule 1.09(c), the
Properties are not presently subject to any federal, state or local lien (including any
“Superfund” lien), proceedings, claim, liability, or action, or the threat or likelihood
thereof, relating to the clean-up, removal or remediation of any hazardous substance from
the Property and neither the Principal Controlled Entities nor their Subsidiaries have
received any request or information from the United States Environmental Protection Agency
or any other public, governmental or quasi-governmental agency or authority with
jurisdiction over any Environmental Law;
(d) To the Principal’s Knowledge, except as disclosed in the reports listed in
Schedule 1.09, there has not been a release of a hazardous substance on any Property
that would require investigation or remediation under applicable Environmental Laws nor has
any hazardous substance been placed or stored in, on, under or over the Property in
violation of any Environmental Law;
(e) Neither the Principal Controlled Entities nor their Subsidiaries have placed,
located, sited or buried any underground storage tanks at the Properties and, to the
Principal’s Knowledge, no underground storage tanks are located on, at or under the
Properties which are not maintained in accordance with applicable Laws; and
(f) Neither the Principal Controlled Entities nor their Subsidiaries have used any part
of the Properties as a sanitary landfill, waste dump site or for the treatment or disposal
of hazardous waste as defined in the Resource Conservation and Recovery Act of 1976 (42
▇.▇.▇. §▇▇▇▇, et seq.), as amended (“RCRA”), and, to the Principal’s
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Knowledge, no part of the Properties were used as a sanitary landfill, waste dump site
or for the treatment or disposal of hazardous waste as defined in RCRA prior to the
ownership thereof by the Principal Controlled Entities and their Subsidiaries except as
disclosed in the Environmental Reports.
The representations and warranties contained in this Section 1.06 constitute the sole and
exclusive representations and warranties made by the Principals concerning environmental
matters.
Section 1.10 EMINENT DOMAIN. There is no existing or, to the Principal’s
Knowledge, proposed or threatened condemnation, eminent domain or similar proceeding, or
private purchase in lieu of such a proceeding which would have a material adverse effect on
the business or operations of any Property reasonably valued to be in excess of the
Threshold Amount.
Section 1.11 FINANCIAL STATEMENTS. The financial statements of the Principal
Controlled Entities included in the PPM and in the Prospectus have been, prepared in all
material respects in accordance with generally accepted accounting principles applied on a
consistent basis during the periods involved (except as may be indicated in the notes
thereto), subject, in the case of unaudited statements, to normal year-end audit
adjustments; provided, however, that the foregoing representation and warranty in respect of
the financial statements included in the Prospectus is made only as of the Closing Date.
Section 1.12 CONSENTS AND APPROVALS. Except as shall have been satisfied on or
prior to the Closing Date, no consent, waiver, approval or authorization of, or filing with,
any Person or Governmental Authority or under any applicable Laws is required to be obtained
by any Principal Controlled Entity or Subsidiary in connection with the execution, delivery
and performance of any of the agreements or documents contemplated by the Contribution
Agreements to which such Principal Controlled Entity is a party and the transactions
contemplated hereby and thereby, except for those consents, waivers, approvals,
authorizations or filings, the failure of which to obtain or to file would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
Section 1.13 NO VIOLATION. None of the execution, delivery or performance by
any Principal Controlled Entity of any agreement or document contemplated by the
Contribution Agreements to which it is a party and the transactions contemplated hereby and
thereby does or will, with or without the giving of notice, lapse of time, or both, violate,
conflict with, result in a breach of, or constitute a default under or give to others any
right of termination, acceleration, cancellation or other right under, (A) the
organizational documents of any Principal Controlled Entity or Subsidiary, (B) any
agreement, document or instrument to which any Principal Controlled Entity or Subsidiary or
any of their respective assets or properties are bound or (C) any term or provision of any
judgment, order, writ, injunction, or decree binding on any Principal Controlled Entity or
Subsidiary, except for, in the case of clause (B) or (C), any such
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breaches or defaults that would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
Section 1.14 TAXES. Except as would not reasonably be expected to have a
Material Adverse Effect, (i) each Principal Controlled Entity and each Subsidiary of a
Principal Controlled Entity has timely filed all Tax and information returns and reports
required to be filed by it (after giving effect to any filing extension properly granted by
a Governmental Authority having authority to do so) and all such returns and reports are
accurate and complete in all material respects, and has paid (or had paid on its behalf) all
Taxes as required to be paid by it, and (ii) (x) no written deficiencies for any Taxes have
been proposed, asserted or assessed against any Principal Controlled Entity, any Subsidiary
of a Principal Controlled Entity or any asset of a Principal Controlled Entity or its
Subsidiaries, and (y) to the Principal’s knowledge, no deficiencies for any Taxes will be
proposed, asserted or assessed against any Principal Controlled Entity, any Subsidiary of a
Principal Controlled Entity or any asset of a Principal Controlled Entity or its
Subsidiaries, and (z) no requests for waivers of the time to assess any such Taxes are
pending. Each Principal Controlled Entity and each Subsidiary of a Principal Controlled
Entity has withheld and paid all Taxes required to have been withheld and paid in connection
with amounts paid or owing to any employee, independent contractor, creditor or other third
party. For U.S. federal income tax purposes, each Principal Controlled Entity and each
Subsidiary of a Principal Controlled Entity is, and at all times during its existence has
been, treated as a partnership or as an entity that is disregarded as an entity separate
from its owner pursuant to Treasury Regulations Section 301.7701-2 (rather than an
association or a publicly traded partnership taxable as a corporation).
Section 1.15 NON-FOREIGN STATUS. None of the Principal Controlled Entities is
a foreign person (as defined in the Code) and none is, therefore, subject to the provisions
of the Code relating to the withholding of sales or exchange proceeds to foreign persons.
Section 1.16 SERVICE BUSINESS AGREEMENTS. All of the Material Agreements
related to the Service Business are listed on Schedule 1.16 and are in full force
and effect and no Principal Controlled Entity or, to the Knowledge of the Principals, other
party to such agreements is in default thereunder.
The Principals hereby agree promptly to give the Consolidated Entities written notice upon
obtaining Knowledge of any information that makes any representation or warranty made by the
Principals hereunder untrue, and in any event to give written notice within five (5) business days
of obtaining Knowledge of such information.
ARTICLE II
NATURE OF REPRESENTATIONS AND WARRANTIES
Section 2.01 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties contained in this Agreement shall be effective from the
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Effective Date until the Closing Date, at which time all representations and warranties
shall expire.
Section 2.02 NO IMPLIED REPRESENTATIONS OR WARRANTIES. Other than the
representations and warranties expressly set forth in Article I, the Principals shall not be
deemed to have made any other representation or warranty in connection with this Agreement
or the transactions contemplated hereby.
ARTICLE III
GENERAL PROVISIONS
Section 3.01 COVENANT. As of the Effective Date, the Principals covenant and
agree to cause each of the Properties to be maintained and operated in the ordinary course,
consistent with past practice and in prudent standards of similar properties in the relevant
jurisdictions. The Principals further covenant and agree to cause the formation of the
Newly Formed Entities prior to the Closing Date and to use all commercially reasonable
efforts to cause the transfer of the properties set forth on Exhibit A-6 hereto, or
assets related thereto, from the Existing Non-Fund Entities to the Newly Formed Entities, as
contemplated by the Contribution Agreements signed by the Existing Non-Fund Entities.
Section 3.02 NOTICES. All notices and other communications under this
Agreement shall be in writing and shall be deemed given when (i) delivered personally, (ii)
five Business Days after being mailed by certified mail, return receipt requested and
postage prepaid, (iii) one Business Day after being sent by a nationally recognized
overnight courier or (iv) transmitted by facsimile if confirmed within 24 hours thereafter
by a signed original sent in the manner provided in clause (i), (ii) or (iii) to the parties
at the following addresses (or at such other address for a party as shall be specified by
notice from such party):
if to the REIT or the Operating Partnership to:
Welsh Property Trust, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attention: Chief Executive Officer
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attention: Chief Executive Officer
if to any Principal, to:
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Section 3.03 DEFINITIONS. For purposes of this Agreement, the following terms
shall have the following meanings.
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(a) “Affiliate” means, with respect to any Person, a Person that, directly or
indirectly, through one or more intermediaries, controls, is controlled by, or is under
common control with the specified Person. For the purposes of this definition, “control”
(including, with correlative meanings, the terms “controlled by” and “under common control
with”) as used with respect to any Person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or policies of
such Person, whether through the ownership of voting securities, by agreement or otherwise.
(b) “Business Day” means any day that is not a Saturday, Sunday or legal holiday in the
State of Minnesota or New York.
(c) “Closing Date” means the closing date of the IPO.
(d) “Code” means the Internal Revenue Code of 1986, as amended, together with the rules
and regulations promulgated or issued thereunder.
(e) “Environmental Laws” means all federal, state and local Laws governing pollution or
the protection of human health or the environment.
(f) “Governmental Authority” means any government or agency, bureau, board, commission,
court, department, official, political subdivision, tribunal or other instrumentality of any
government, whether federal, state or local, domestic or foreign.
(g) “Knowledge” means the actual current knowledge of the Principal without duty of
investigation or inquiry.
(h) “Laws” means laws, statutes, rules, regulations, codes, orders, ordinances,
judgments, injunctions, decrees and policies of any Governmental Authority.
(i) “Liens” means all pledges, claims, liens, charges, restrictions, controls,
easements, rights of way, exceptions, reservations, leases, licenses, grants, covenants and
conditions, encumbrances and security interests of any kind or nature whatsoever.
(j) “Material Adverse Effect” means a material adverse effect on the REIT, the
Operating Partnership, the Properties and the Service Business taken as a whole.
(k) “Material Agreement” means an agreement involving revenues or expenses in excess of
$100,000 per annum, other than brokerage and listing agreements which can be terminated at
will and the value of which cannot be determined prior to the closing of the sale to which
such agreement relates.
(l) “Permitted Liens” means (i) Liens, or deposits made to secure the release of such
Liens, securing Taxes, the payment of which is not delinquent or the payment of which is
actively being contested in good faith by appropriate proceedings diligently pursued and for
which appropriate reserves are being maintained; (ii) zoning Laws generally applicable to
the districts in which the Properties are located that do not materially impair the current
use of a Property; (iii) easements, licenses, rights-of-way
11
encroachments, rights of access or other non-monetary matters that do not materially
impair the current use of a Property and, if not disclosed in a title policy described in
subparagraph (ix) below, do not individually or in the aggregate have a material adverse
effect on the value of a Property; (iv) Liens securing financing or credit arrangements
existing as of the Effective Date as set forth on Schedule 3.03(l) hereto; (v) Liens
arising under written leases entered into with third parties, as tenants only, in the
ordinary course of business; (vi) such minor defects, irregularities, encumbrances,
easements, rights-of-way and covenants running with the land as normally exist with respect
to properties similarly used and which do not materially impair the current use of the
Property and, if not disclosed in a title policy described in subparagraph (ix) below, do
not individually or in the aggregate have a material adverse effect on the value of a
Property; (vii) Liens in respect of Property imposed by law which were incurred in the
ordinary course of business such as carriers’, warehousemen’s, mechanics’, materialmen’s,
workmen’s and repairmen’s liens, equipment leases and other similar liens arising in the
ordinary course of business that are not delinquent and for which adequate reserves are
being maintained; (viii) liens consisting of pledges or deposits required in the ordinary
course of business in connection with workers’ compensation, unemployment insurance and
other social security or similar legislation that are not delinquent and for which adequate
reserves are being maintained, (ix) liens consisting of judgment or judicial attachment
liens (including prejudgment attachment) arising from claims or proceedings that are being
contested in good faith by appropriate proceedings and for which adequate reserves have been
set aside, or which are covered in full (subject to a customary deductible) by insurance;
and (x) any exceptions contained in the title policies, made available to the Consolidated
Entities prior to the Effective Date, relating to the Properties as of the Effective Date.
(m) “Person” means an individual, corporation, partnership, limited liability company,
joint venture, association, trust, unincorporated organization or other entity.
(n) “PPM” means the Confidential Offering Memorandum, dated December 23, 2009, of the
Operating Partnership, as supplemented on February 16, 2010.
(o) “Pre-Formation Participants” means the Investment Funds, the Existing Non-Fund
Entities, the holders of the equity interests in the Non-Fund Entities (other than the Newly
Formed Entities), including the equity owners of the Outside Entities, and the Principals.
(p) “Prospectus” means the prospectus contained in the Registration Statement at the
time the Registration Statement becomes effective under the Securities Act.
(q) “Registration Statement” means the registration statement on Form S-11, as
amended, filed by the REIT under the Securities Act to register the offer and sale of the
REIT Shares in the IPO.
(r) “Securities Act” means the Securities Act of 1933, as amended, the rules and
regulations promulgated thereunder.
12
(s) “Subsidiary” means any corporation, partnership, limited liability company, joint
venture, trust or other legal entity which a Principal Controlled Entity owns (either
directly or through or together with another Subsidiary) either (i) a general partner,
managing member or other similar interest, or (ii)(A) 50% or more of the voting power of the
voting capital stock or other equity interests, or (B) 50% or more of the outstanding voting
capital stock or other voting equity interests of such corporation, partnership, limited
liability company, joint venture or other legal entity.
(t) “Tax” means all federal, state, local and foreign income, withholding, property,
sales, franchise, employment, excise and other taxes, tariffs or governmental charges of any
nature whatsoever, including (i) estimated taxes, together with penalties, interest or
additions to Tax with respect thereto and (ii) any taxes of another person or entity as a
result of any transfer, succession or assignment, by contract, or otherwise.
(u) “Threshold Amount” means $6,250,000.00.
Section 3.04 COUNTERPARTS. This Agreement may be executed in counterparts, all
of which shall be considered one and the same agreement and shall become effective when one
or more counterparts have been signed by each party and delivered to each other party.
Section 3.05 ENTIRE AGREEMENT; THIRD-PARTY BENEFICIARIES. This Agreement and
the Escrow Agreement, including, without limitation, the exhibits hereto and thereto,
constitute the entire agreement and supersede each prior agreement and understanding,
whether written or oral, among the parties regarding the subject matter of this Agreement.
This Agreement is not intended to confer any rights or remedies on any Person other than the
parties hereto.
Section 3.06 GOVERNING LAW. This Agreement shall be governed by, and construed
in accordance with, the Laws of the State of Delaware, regardless of any laws that might
otherwise govern under applicable principles of conflicts of laws thereof.
Section 3.07 ASSIGNMENT. This Agreement shall be binding upon, and shall be
enforceable by and inure to the benefit of, the parties hereto and their respective heirs,
legal representatives, successors and assigns; provided, however, that this Agreement may
not be assigned (except by operation of law) by any party without the prior written consent
of the other parties, and any attempted assignment without such consent shall be null and
void and of no force and effect, except that the Operating Partnership may assign its rights
and obligations hereunder to an Affiliate.
Section 3.08 JURISDICTION. The parties hereto hereby (a) submit to the
exclusive jurisdiction of any state or federal court sitting in the County of Hennepin
(collectively, the “Minnesota Courts”), with respect to any dispute arising out of this
Agreement or any transaction contemplated hereby to the extent such courts would have
subject matter jurisdiction with respect to such dispute, and (b) irrevocably waive, and
agree not to assert by way of motion, defense, or otherwise, in any such action, any claim
that it is not subject personally to the jurisdiction of the above-named courts, that its
13
property is exempt or immune from attachment or execution, that the action is brought
in an inconvenient forum, or that the venue of the action is improper.
Section 3.09 SEVERABILITY. Each provision of this Agreement will be
interpreted so as to be effective and valid under applicable law, but if any provision is
held invalid, illegal or unenforceable under applicable law in any jurisdiction, then such
invalidity, illegality or unenforceability will not affect any other provision, and this
Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been included herein.
Section 3.10 RULES OF CONSTRUCTION.
(a) The parties hereto agree that they have been represented by counsel during the
negotiation, preparation and execution of this Agreement and, therefore, waive the
application of any law, regulation, holding or rule of construction providing that
ambiguities in an agreement or other document will be construed against the party drafting
such agreement or document.
(b) The words “hereof,” “herein” and “herewith” and words of similar import shall,
unless otherwise stated, be construed to refer to this Agreement as a whole and not to any
particular provision of this Agreement, and article, section, paragraph, exhibit and
schedule references are to the articles, sections, paragraphs, exhibits and schedules of
this Agreement unless otherwise specified. Whenever the words “include,” “includes” or
“including” are used in this Agreement, they shall be deemed to be followed by the words
“without limitation.” All terms defined in this Agreement shall have the defined meanings
contained herein when used in any certificate or other document made or delivered pursuant
hereto unless otherwise defined therein. The definitions contained in this Agreement are
applicable to the singular as well as the plural forms of such terms and to the masculine as
well as to the feminine and neuter genders of such terms. Any agreement, instrument or
statute defined or referred to herein or in any agreement or instrument that is referred to
herein means such agreement, instrument or statute as from time to time, amended, qualified
or supplemented, including (in the case of agreements and instruments) by waiver or consent
and (in the case of statutes) by succession of comparable successor statutes and all
attachments thereto and instruments incorporated therein. References to a Person are also
to its permitted successors and assigns.
Section 3.11 EQUITABLE REMEDIES. The parties agree that irreparable damage
would occur to the Operating Partnership in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were otherwise
breached. It is accordingly agreed that the Operating Partnership shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement by the Principals and to
enforce specifically the terms and provisions hereof in any federal or state court located
in Hennepin County, Minnesota, this being in addition to any other remedy to which the
Operating Partnership is entitled under this Agreement or otherwise at law or in equity.
14
Section 3.12 TIME OF THE ESSENCE. Time is of the essence with respect to all
obligations under this Agreement.
Section 3.13 DESCRIPTIVE HEADINGS. The descriptive headings herein are
inserted for convenience only and are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
Section 3.14 NO PERSONAL LIABILITY CONFERRED. This Agreement shall not create
or permit any personal liability or obligation on the part of any officer, director,
partner, employee or stockholder of the REIT or the Operating Partnership in their
capacities as such.
[SIGNATURE PAGE FOLLOWS]
15
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed by their
respective duly authorized officers, all as of the date first written above.
| CONSOLIDATED ENTITIES WELSH PROPERTY TRUST, INC. |
||||
| By: | /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ | |||
| Name: | ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ | |||
| Title: | Chief Executive Officer | |||
| WELSH PROPERTY TRUST PROPERTIES, L.P. By: Welsh Property Trust, LLC Its General Partner |
||||
| By: | /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ | |||
| Name: | ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ | |||
| Title: | Chief Executive Officer | |||
PRINCIPALS |
||
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
|
||
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ |
||
/s/ ▇▇▇▇ ▇▇▇▇
|
||
▇▇▇▇ ▇▇▇▇ |
||
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
|
||
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ |
EXHIBIT A-1
INVESTMENT FUNDS AND FUND ENTITIES
| • | Welsh Midwest Real Estate Fund, LLC |
| • | 450 Lombard, LLC | ||
| • | 1920 Beltway, LLC | ||
| • | 2036 ▇▇▇▇▇, LLC | ||
| • | 7750 Zionsville, LLC | ||
| • | ▇▇▇▇ ▇▇▇▇▇▇, LLC | ||
| • | Urbandale Properties, LLC |
| • | Urbandale Delaware Properties, LLC |
| • | Welsh CJC, LLC | ||
| • | ▇▇▇▇▇ ▇▇, LLC | ||
| • | Welsh Hernasco, LLC | ||
| • | Welsh Jacksonville, LLC | ||
| • | Welsh Kiesland, LLC | ||
| • | Welsh Kiesland II, LLC | ||
| • | Welsh Rivers Park, LLC | ||
| • | Welsh Symmes Road, LLC |
| • | Welsh Real Estate Fund IV, LLC |
| • | Welsh ▇▇▇▇▇▇ Road, LLC | ||
| • | Welsh Fond du Lac, LLC | ||
| • | ▇▇▇▇▇ ▇▇▇▇▇▇ Way, LLC |
1
Welsh US Real Estate Fund, LLC
| • | Welsh 201 Mississippi, LLC | ||
| • | ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLC | ||
| • | Welsh ▇▇▇▇▇▇ Road, LLC | ||
| • | ▇▇▇▇▇ ▇▇▇▇▇▇, LLC | ||
| • | Welsh Queenland, LLC | ||
| • | Welsh Romulus Development, LLC | ||
| • | Welsh Romulus Mezz, LLC |
| • | Welsh Romulus, LLC |
2
EXHIBIT A-2
NON-FUND ENTITIES
| • | Welsh ▇▇▇▇▇▇ ▇▇, LLC | |
| • | Welsh Lincoln II, LLC | |
| • | Welsh Orange City, LLC | |
| • | Welsh ▇▇▇▇▇▇▇▇▇ ▇▇, LLC | |
| • | Oxford Industrial Partners Limited Partnership | |
| • | Welsh ▇▇▇▇▇ Road, LLC | |
| • | Creekedge Business Center, LLC | |
| • | Welsh Executive Park II, LLC | |
| • | Waters Ventures, LLC | |
| • | Welsh Green Park, LLC | |
| • | Welsh Lambert Pointe Development III, LLC | |
| • | Welsh Lambert Pointe Holdings, LLC | |
| • | Welsh Lambert Pointe Holdings II, LLC | |
| • | Welsh Lambert Pointe Development II, LLC | |
| • | MS/TB, LLC | |
| • | MMBC Intercen, LLC | |
| • | Welsh Intercen, LLC |
| • | PH Intercen, LLC | ||
| • | Intercen Partners, LLC |
| • | Welsh Shoreview, LLC | |
| • | ▇▇▇▇▇ PaR, LLC | |
| • | ZEL Shoreview, LLC | |
| • | 918 Plymouth Partners, LLC | |
| • | Welsh Ankeny II, LLC | |
| • | Bloomgate Holdings, LLC | |
| • | Westval Ventures, LLC |
| • | Westval Ventures Sub, LLC |
| • | Roseridge Financial, LLC | |
| • | TriCor Properties, LLP | |
| • | TriCor Properties, LLC | |
| • | Valley View Investments, LLC | |
| • | Welsh Tri-Center II, LLC | |
| • | Welsh Partners 85, LLC | |
| • | Welsh Glendale, LLC | |
| • | ▇▇▇▇▇▇▇▇ Glendale, LLC | |
| • | ▇▇▇▇▇▇▇▇▇ Glendale, LLC | |
| • | Welsh Pewaukee, LLC | |
| • | ▇▇▇▇▇▇▇▇ Pewaukee, LLC | |
| • | ▇▇▇▇▇▇▇▇▇ Pewaukee, LLC |
3
| • | FAE Westbelt SPE, LLC | |
| • | Welsh Westbelt, LLC | |
| • | ▇▇▇▇▇▇▇ Exchange, LLC | |
| • | ▇▇▇▇▇▇▇▇▇ Enterprise Park, LLC | |
| • | Sauk Point Square, LLC | |
| • | Koloa Durham, LLC |
4
EXHIBIT A-3
SERVICE COMPANIES
The Principals own the following two Service Companies through three entities, each of which
is wholly-owned by one of the Principals:
| • | WelshCo, LLC | ||
| • | Welsh Securities, LLC |
WelshCo, LLC is the sole member of the following Service Companies:
| • | Welsh Companies, LLC | ||
| • | Welsh Facilities Services, LLC | ||
| • | Welsh Capital, LLC | ||
| • | Genesis Architecture, LLC | ||
| • | Welsh Construction, LLC | ||
| • | WelshInvest, LLC |
5
EXHIBIT A-4
JV COMPANIES
| • | Welsh Holdings CNL Fund, LLC (to hold interest in following subsidiaries, if required by lender) |
| • | Welsh CNL Fund I, LLC (5% interest only) | ||
| • | Welsh CNL Management, LLC (5% interest only) | ||
| • | Welsh Fingerhut Equipment, LLC (5% interest only) |
| • | KADO Investment Partners, LLC |
| • | KADO Southdale Investment, LLC (owns 21.73% TIC interest in property) |
6
EXHIBIT A-5
Entities That Own Property as Tenants in Common with Welsh US Real Estate Fund, LLC
| • | ▇▇▇▇▇▇▇ Exchange, LLC | ||
| • | ▇▇▇▇▇▇▇▇▇ Enterprise Park, LLC | ||
| • | Sauk Point Square, LLC | ||
| • | Koloa Durham, LLC |
Non-Controlled Entities That Own Property as Tenants in Common
| • | MS/TB, LLC | ||
| • | MMBC Intercen, LLC | ||
| • | ZEL Shoreview, LLC | ||
| • | ▇▇▇▇▇▇▇▇▇ Pewaukee, LLC | ||
| • | Van Vliet Pewaukee, LLC | ||
| • | ▇▇▇▇▇▇▇▇▇ Glendale, LLC | ||
| • | Van Vliet Glendale, LLC | ||
| • | Welsh Westbelt, LLC | ||
| • | Roseridge Financial, LLC |
7
EXHIBIT A-6
| EXISTING NON-FUND ENTITIES | NEWLY FORMED ENTITIES | PROPERTY ADDRESS | ||
▇▇▇▇▇ ▇▇▇▇▇▇, LLC
|
Welsh ▇▇▇▇▇▇ ▇▇, LLC | ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇ | ||
▇▇▇▇▇ ▇▇▇▇▇▇, Inc.
|
Welsh ▇▇▇▇▇▇▇▇▇ ▇▇, LLC | ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇ ▇▇▇▇, ▇▇ | ||
Oakcreek Industrial Partners, LLC
|
Creekedge Business Center, LLC | 7247-7275 Flying Cloud Drive, Eden Prairie, MN | ||
Welsh Ankeny, LLC
|
Welsh Ankeny II, LLC | ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||
B&D Ankeny, LLC |
||||
| TriCor Properties, LLC | ▇▇▇▇-▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | |||
| ▇▇▇▇-▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||||
Welsh Tri-Center, LLC
|
Welsh Tri-Center II, LLC | 1700-1910 Elmhurst, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||
AM ▇▇▇▇▇▇▇▇ Properties, L.C.* |
||||
▇▇▇▇ ▇▇▇▇▇▇▇▇ Properties, L.C.* |
||||
Welsh Partners 85, a Limited Partnership
|
Welsh Partners 85, LLC | ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||
| ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||||
| ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||||
Welsh Executive Park, LLC
|
Welsh Executive Park II, LLC | ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ | ||
MS/TB KC, LLC* |
||||
DJD Executive Park, LLC |
8
| EXISTING NON-FUND ENTITIES | NEWLY FORMED ENTITIES | PROPERTY ADDRESS | ||
Welsh Lincoln, LLC
|
Welsh Lincoln II, LLC | ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇, ▇▇ | ||
S.M.D. Lincoln Investments, LLC |
||||
Hickory Hills Apartments Limited |
||||
Partnership |
| * | Outside Entity |
9
EXHIBIT B-1
FUND PROPERTIES
Welsh Midwest Real Estate Fund, LLC
450 Lombard, LLC
| • | ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
1920 Beltway, LLC
| • | ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
2036 ▇▇▇▇▇, LLC
| • | ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
7750 Zionsville, LLC
| • | ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
▇▇▇▇ ▇▇▇▇▇▇, LLC
| • | 2201 ▇▇▇▇ Road, Elk Grove Village (Chicago), IL 60007 |
Urbandale Properties, LLC (Interests held indirectly through a wholly-owned
subsidiary, Urbandale Delaware Properties, LLC)
| • | ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||
| • | ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||
| • | ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||
| • | ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||
| • | ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||
| • | ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh CJC, LLC
| • | ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
10
▇▇▇▇▇ ▇▇, LLC
| • | Mortgage interest on a property that was sold |
Welsh Hernasco, LLC
| • | ▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh Jacksonville, LLC
| • | ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh Kiesland, LLC
| • | ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
| • | ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ (▇▇▇▇▇▇▇▇▇▇), ▇▇ ▇▇▇▇▇ |
| • | ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ (▇▇▇▇▇▇▇▇▇▇), ▇▇ ▇▇▇▇▇ |
| • | ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh Kiesland II, LLC
| • | ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh Rivers Park, LLC
| • | ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh Symmes Road, LLC
| • | ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh Real Estate Fund IV, LLC
Welsh ▇▇▇▇▇▇ Road, LLC
| • | ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh Fond du Lac, LLC
| • | ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇, ▇▇ ▇▇▇▇▇ |
▇▇▇▇▇ ▇▇▇▇▇▇ Way, LLC
| • | Purchase agreement with respect to property located in Kansas City, MO |
11
Welsh US Real Estate Fund, LLC
Welsh 201 Mississippi, LLC (to hold entire interest in former TIC property)
| • | ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇, ▇▇ ▇▇▇▇▇ |
▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLC (to hold entire interest in former TIC property)
| • | ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh ▇▇▇▇▇▇ Road, LLC
| • | ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (34.65% tenant-in-common interest; remaining interest to be held by Non-Fund Entity — 65.35% Koloa Durham, LLC) |
▇▇▇▇▇ ▇▇▇▇▇▇, LLC
| • | ▇▇▇▇-▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (18.09% tenant-in-common interest; remaining interest to be held by Non-Fund Entities — 39.00% by ▇▇▇▇▇▇▇▇▇ Enterprise Park, LLC and 42.91% by ▇▇▇▇▇▇▇ Exchange, LLC) |
Welsh Queenland, LLC
| • | ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (to hold 30.90% tenant-in-common interest; remaining interest to be held by Non-Fund Entity — 69.10% Sauk Point Square, LLC) |
Welsh Romulus Development, LLC
| Vacant land located in Romulus, MI |
Welsh Romulus Mezz, LLC (Interests held indirectly through a wholly-owned
subsidiary, Welsh Romulus, LLC)
| • | ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
| • | ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
| • | ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
| • | ▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
| • | ▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
12
EXHIBIT B-2
NON-FUND PROPERTIES
Welsh ▇▇▇▇▇▇ ▇▇, LLC (to be formed to hold entire interest in former TIC property)
| • | ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇ |
Welsh Lincoln II, LLC (to be formed to hold entire interest in former TIC property)
| • | ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇, ▇▇ |
Welsh Orange City, LLC
| • | ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ |
Oxford Industrial Partners Limited Partnership (Welsh ▇▇▇▇▇▇▇▇▇ ▇▇, LLC to be formed to
hold a 2% general partnership interest in Oxford Partners Limited Partnership)
| • | ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇ ▇▇▇▇, ▇▇ |
Welsh ▇▇▇▇▇ Road, LLC
| • | ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ |
| • | ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ |
Creekedge Business Center, LLC (to be formed to hold interest formerly held by Oakcreek
Industrial Partners, LLC)
| • | 7247-7275 Flying Cloud Drive, Eden Prairie, MN |
Welsh Executive Park II, LLC (to be formed to hold entire interest in former TIC property)
| • | ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ |
Waters Ventures, LLC
| • | Loan Oak Parkway, Eagan, MN |
▇▇▇▇▇ Green Park, LLC
| • | ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇ |
Welsh Lambert Pointe Development III, LLC
| • | ▇▇▇-▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ |
▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Holdings, LLC
| • | ▇▇▇-▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ |
Welsh Lambert Pointe Holdings II, LLC
| • | ▇▇▇-▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ |
Welsh Lambert Pointe Development II, LLC
| • | ▇▇▇-▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ (70.09% tenant-in-common interest) |
MS/TB, LLC
| • | ▇▇▇-▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ (29.91% tenant-in-common interest) |
MMBC Intercen, LLC
| • | ▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ (39.3% direct interest in Intercen Partners, LLC, the property owner) |
Welsh Intercen, LLC
| • | ▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ (21.4% direct interest in Intercen Partners, LLC, the property owner; 39.3% interest held indirectly through a wholly-owned subsidiary, PH Intercen, LLC) |
Welsh Shoreview, LLC
| • | ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (25% tenant-in-common interest) |
▇▇▇▇▇ PaR, LLC
| • | ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (25% tenant-in-common interest) |
ZEL Shoreview, LLC
| • | ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (50% tenant-in-common interest) |
▇▇▇ ▇▇▇▇▇▇▇▇ Partners, LLC
14
| • | ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
| • | ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh Ankeny II, LLC (to be formed to hold entire interest in former TIC property)
| • | ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Bloomgate Holdings, LLC
| • | ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Westval Ventures, LLC
| • | ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (88.59% tenant-in-common interest held indirectly through Westval Ventures Sub, LLC) |
| • | 13810-13800 ▇▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (88.59% tenant-in-common interest held indirectly through Westval Ventures Sub, LLC) |
Roseridge Financial, LLC
| • | ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (11.41% tenant-in-common interest) |
| • | 13810-13800 ▇▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (11.41% tenant-in-common interest) |
TriCor
Properties, LLP (TriCor Properties, LLC to be formed to hold 28% partnership
interest)
| • | ▇▇▇▇-▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
| • | ▇▇▇▇-▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Valley View Investments, LLC
| • | ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh
Tri-Center II, LLC (to be formed to hold entire interest in former TIC property)
| • | 1700-1910 Elmhurst, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
15
Welsh Partners 85, LLC (to be formed to hold interest formerly held by Welsh Partners 85, a
Limited Partnership)
| • | ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
| • | ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
| • | ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh Glendale, LLC
| • | ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (57.35% tenant-in-common interest) |
Van Vliet Glendale, LLC
| • | ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (23.00% tenant-in-common interest) |
▇▇▇▇▇▇▇▇▇ Glendale, LLC
| • | ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (19.65% tenant-in-common interest) |
Welsh Pewaukee, LLC
| • | ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (57.35% tenant-in-common interest) |
Van Vliet Pewaukee, LLC
| • | ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (23.00% tenant-in-common interest) |
▇▇▇▇▇▇▇▇▇ Pewaukee, LLC
| • | ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (19.65% tenant-in-common interest) |
FAE Westbelt SPE, LLC
| • | ▇▇▇▇-▇▇▇▇ ▇’▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (80% tenant-in-common interest) |
Welsh Westbelt, LLC
| • | ▇▇▇▇-▇▇▇▇ ▇’▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (20% tenant-in-common interest) |
16
EXHIBIT B-3
JV PROPERTIES
Welsh CNL Fund I, LLC owns the following wholly-owed subsidiaries which, in turn, own the
properties indicated:
Welsh ADS IN, LLC
| • | ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh ADS NC, LLC
| • | ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh Core OH, LLC
| • | ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
WelshFingerhut MN, LLC
| • | ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh GMR WI, LLC
| • | ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
▇▇▇▇▇ ▇▇ WI, LLC
| • | ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh ▇▇▇▇▇▇▇ AL, LLC
| • | 1608 ▇▇▇▇▇ ▇▇▇▇▇ Road, Anniston, AL 36202 |
Welsh Leedsworld PA, LLC
| • | ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh Midland WI, LLC
| • | ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh Navarre MN, LLC
| • | ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ |
▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇, LLC
| • | ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh Riviera MI, LLC
| • | ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
Welsh Superstock FL, LLC
| • | ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ |
KADO Investment Partners, LLC owns the following wholly-owed subsidiary which, in turn, owns
the property indicated:
KADO Southdale Investment, LLC
| • | ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (21.73% tenant-in-common interest held indirectly through a wholly-owned subsidiary, KADO Southdale Investment, LLC; remaining 78.27% tenant-in-common interest held by Southdale Office, LLC, a third party not participating in the Formation Transactions) |
18