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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
DATE OF REPORT: SEPTEMBER 29, 1999
(Date of earliest event reported)
SUN COMMUNITIES, INC.
(Exact name of registrant as specified in its charter)
MARYLAND COMMISSION FILE NO. 1-12616 38-2730780
(State of Organization) (IRS Employer I.D. No.)
31700 MIDDLEBELT ROAD
SUITE 145
FARMINGTON HILLS, MICHIGAN 48334
(Address of principal executive offices)
(248) 932-3100
(Registrant's telephone number, including area code)
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ITEM 5. OTHER EVENTS.
On September 29, 1999, Sun Communities, Inc., a Maryland
corporation (the "Company"), Sun Communities Operating Limited Partnership, a
Michigan limited partnership (the "Partnership"), Belcrest Realty Corporation, a
Delaware corporation ("Belcrest"), and Belair Real Estate Corporation, a
Delaware corporation (together with Belcrest, the "Contributors"), entered into
a Contribution Agreement (a copy of which is filed as an exhibit to this Form
8-K), pursuant to which, among other things, the Contributors contributed an
aggregate of $50 million to the Partnership in return for an aggregate of
2,000,000 9.125% Series A Cumulative Redeemable Perpetual Preferred Units in the
Partnership (the "Series A Preferred Units"). The rights, limitations and
preferences of the Series A Preferred Units are set forth in the One Hundred
Third Amendment to the Second Amended and Restated Limited Partnership Agreement
of the Partnership, dated as of September 29, 1999 (the "Amendment") , a copy of
which is filed as an exhibit to this Form 8-K.
The Series A Preferred Units will be exchangeable, in whole
but not in part, at any time on or after September 29, 2009 at the option of the
holders thereof for 9.125% Series A Cumulative Redeemable Preferred Stock of the
Company (the "Series A Preferred Stock") at an exchange rate of one share of
Series A Preferred Stock for one Series A Preferred Unit, subject to adjustment
as set forth in the Amendment, and at certain earlier times pursuant to the
terms of the Amendment. The rights, limitations and preferences of the Series A
Preferred Stock are set forth in that certain Articles Supplementary to the
Charter of the Company, dated as of September 29, 1999, a copy of which is filed
as an exhibit to this Form 8-K. The Company has granted certain registration
rights to the Contributors with respect to the Series A Preferred Stock pursuant
to a Registration Rights Agreement, dated as of September 29, 1999, among the
Company and the Contributors, a copy of which is filed as an exhibit to this
Form 8-K.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
4.1 Articles Supplementary to the Company's Charter,
dated as of September 29, 1999
99.1 Contribution Agreement, dated as of September 29,
1999, by and among the Company, the Partnership and
the Contributors
99.2 One Hundred Third Amendment to the Second Amended and
Restated Limited Partnership Agreement of the
Partnership
99.3 Registration Rights Agreement, dated as of September
29, 1999, by and among the Company and the
Contributors.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: October 14, 1999 SUN COMMUNITIES, INC., a Maryland corporation
By: /s/ Jeffrey P. Jorissen
-------------------------------------------
Jeffrey P. Jorissen, Senior Vice President,
Treasurer, Chief Financial Officer, and
Secretary
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SUN COMMUNITIES, INC.
EXHIBIT INDEX
Exhibit
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4.1 Articles Supplementary to the Company's Charter, dated as of September
29, 1999
99.1 Contribution Agreement, dated as of September 29, 1999, by and among
the Company, the Partnership and the Contributors
99.2 One Hundred Third Amendment to the Second Amended and Restated Limited
Partnership Agreement of the Partnership
99.3 Registration Rights Agreement, dated as of September 29, 1999, by and
among the Company and the Contributors.
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EXHIBIT 4.1
SUN COMMUNITIES, INC.
ARTICLES SUPPLEMENTARY
SUN COMMUNITIES, INC., a Maryland corporation (the "COMPANY"), hereby
certifies to the State Department of Assessments and Taxation of Maryland (the
"DEPARTMENT") that:
FIRST: Pursuant to the authority expressly vested in the Board
of Directors of the Company by Article V of the Charter of the Company
and Sections 2-105 and 2-208 of the Maryland General Corporation Law
(the "MGCL"), the Board of Directors of the Company (the "BOARD OF
DIRECTORS"), by resolutions duly adopted as of September 23, 1999, has
classified 2,000,000 shares of the authorized but unissued shares of
the preferred stock par value $.01 per share ("PREFERRED STOCK") of the
Company as a separate class of Preferred Stock, such class being
designated the "9.125% Series A Cumulative Redeemable Perpetual
Preferred Stock."
SECOND: The class of Preferred Stock of the Company created by
the resolutions duly adopted by the Board of Directors of the Company
and referred to in Article FIRST of these Articles Supplementary shall
have the following designation, number of shares, preferences,
conversion and other rights, voting powers, restrictions, limitation as
to dividends and other distributions, qualifications, terms and
conditions of redemption and other terms and conditions:
SECTION 1. DESIGNATION AND NUMBER. The shares of
Preferred Stock hereby classified shall be designated the
"9.125% Series A Cumulative Redeemable Perpetual Preferred
Stock" (the "SERIES A PREFERRED STOCK"). The number of shares
of Series A Preferred Stock shall be 2,000,000.
SECTION 2. RANK. The Series A Preferred Stock will,
with respect to distributions and rights upon voluntary or
involuntary liquidation, winding-up or dissolution of the
Company, rank senior to all classes or series of Common Stock
(as defined in the Charter) and to all classes or series of
equity securities of the Company now or hereafter authorized,
issued or outstanding, other than any class or series of
equity securities of the Company expressly designated as
ranking on a parity with or senior to the Series A Preferred
Stock as to distributions and rights upon voluntary or
involuntary liquidation, winding-up or dissolution of the
Company. For purposes of these Articles Supplementary, the
term "PARITY
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PREFERRED STOCK" shall be used to refer to any class or series
of equity securities of the Company now or hereafter
authorized, issued or outstanding expressly designated by the
Company to rank on a parity with Series A Preferred Stock with
respect to distributions and rights upon voluntary or
involuntary liquidation, winding-up or dissolution of the
Company. The term "equity securities" does not include debt
securities, which will rank senior to the Series A Preferred
Stock.
SECTION 3. DISTRIBUTIONS.
(a) Payment of Distributions.
(i) Subject to the rights of holders of
Parity Preferred Stock as to the payment of
distributions and holders of equity securities
ranking senior to the Series A Preferred Stock as to
payment of distributions, holders of Series A
Preferred Stock will be entitled to receive, when, as
and if declared by the Company, out of funds legally
available for the payment of distributions,
cumulative preferential cash distributions at the
rate per annum of 9.125% of the $25.00 liquidation
preference per share of Series A Preferred Stock (the
"ISSUANCE RATE").
(ii) In the event that on or prior to
December 31, 1999 the senior unsecured debt of Sun
Communities Operating Limited Partnership shall have
either an unconditional, published (A) rating by
Standard & Poor's Ratings Group ("STANDARD & POOR'S")
exceeding "BBB" or (B) rating by Moody's Investors
Service, Inc. ("MOODY'S") exceeding "Baa3", then,
beginning on the date on which either of such
foregoing conditions is met, the rate per annum of
the cumulative preferential cash distributions on the
Series A Preferred Stock shall be 8.875% (the
"REVISED RATE") of the $25.00 liquidation preference
per share of Series A Preferred Stock, in which case
the designation of the Series A Preferred Stock will
change accordingly to reflect such new distribution
rate; provided, that, if either (i) such Standard &
Poor's unconditional published rating exceeding "BBB"
or (ii) such Moody's rating exceeding "Baa3" shall
not be in effect on December 31, 1999, then the
Revised Rate herein provided shall be void ab initio
and the Company shall pay on December 31, 1999, in
addition to the dividend then due to the holders of
the Series A Preferred Stock, the difference between
(1) the dividend that would have accrued at the
Issuance Rate during the current and any prior
quarterly distribution period and (2) the dividend
that actually accrued during such distribution
periods at the voided Revised Rate.
(iii) Promptly after December 31, 1999 the
parties hereto shall execute, acknowledge and
deliver, or cause to be executed, acknowledged
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and delivered, all instruments and documents as may
be reasonably necessary or desirable to memorialize
the revision of the distribution rate in effect from
and after December 31, 1999 in accordance with
Section 3(a)(ii) above.
(iv) All distributions shall be cumulative,
shall accrue from the original date of issuance and
shall 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, commencing
on the first of such dates to occur after the
original date of issuance and, (ii) in the event of a
redemption, on the redemption date (each a "PREFERRED
STOCK DISTRIBUTION PAYMENT DATE"). The amount of the
distribution payable for any period will be computed
on the basis of a 360-day year of twelve 30-day
months and for any period shorter than a full
quarterly period for which distributions are
computed, the amount of the distribution payable will
be computed based on the ratio of the actual number
of days elapsed in such quarterly period to ninety
(90) days. If any date on which distributions are to
be made on the Series A Preferred Stock is not a
Business Day (as defined herein), then payment of the
distribution to be made on such date will be made on
the next succeeding day that is a Business Day (and
without any interest or other payment in respect of
any such delay) except that, if such Business Day is
in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business
Day, in each case with the same force and effect as
if made on such date. Distributions on the Series A
Preferred Stock will be made to the holders of record
of the Series A Preferred Stock on the relevant
record dates, which, unless otherwise provided by the
Company with respect to any distribution, will be
fifteen (15) Business Days prior to the relevant
Preferred Stock Distribution Payment Date (each a
"DISTRIBUTION RECORD DATE"). Notwithstanding anything
to the contrary set forth herein, each share of
Series A Preferred Stock shall also continue to
accrue all accrued and unpaid distributions up to the
exchange date on any Series A Preference Unit (as
defined in the Second Amended and Restated Limited
Partnership Agreement of Sun Communities Operating
Limited Partnership, dated as of April 30, 1996, as
amended by (i) those certain amendments numbered one
through one hundred two, and (ii) the One Hundred
Third Amendment to the Agreement of Limited
Partnership, dated as of September 29, 1999, and as
may be further amended from time to time
(collectively, as amended, the "PARTNERSHIP
AGREEMENT") validly exchanged into such share of
Series A Preferred Stock in accordance with the
provisions of such Partnership Agreement.
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(v) The term "BUSINESS DAY" shall mean each
day, other than a Saturday or a Sunday, which is not
a day on which banking institutions in New York, New
York are authorized or required by law, regulation or
executive order to close.
(b) Limitations on Distributions. No distributions on
the Series A Preferred Stock shall be declared or paid or set
apart for payment by the Company at such time as the terms and
provisions of any agreement of the Company, including any
agreement relating to its indebtedness, prohibits such
declaration, payment or setting apart for payment or provides
that such declaration, payment or setting apart for payment
would constitute a breach thereof or a default thereunder, or
if such declaration, payment or setting apart for payment
shall be restricted or prohibited by law.
(c) Distributions Cumulative. Notwithstanding the
foregoing, distributions on the Series A Preferred Stock will
accrue whether or not declared, whether or not the terms and
provisions set forth in SECTION 3(B) hereof at any time
prohibit the current payment of distributions, whether or not
the Company has earnings, whether or not there are funds
legally available for the payment of such distributions and
whether or not such distributions are authorized or declared.
Accrued but unpaid distributions on the Series A Preferred
Stock will accumulate as of the Preferred Stock Distribution
Payment Date on which they first become payable. Accumulated
and unpaid distributions will not bear interest.
(d) Priority as to Distributions.
(i) So long as any Series A Preferred Stock
is 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 Common Stock or any class or series of
equity securities of the Company ranking junior to
the Series A Preferred Stock as to distributions or
rights upon voluntary or involuntary dissolution,
liquidation or winding up of the Company to the
Series A Preferred Stock (such Common Stock or other
junior equity securities, collectively, "JUNIOR
STOCK"), 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 A
Preferred Stock, any Parity Preferred Stock or any
Junior Stock, unless, in each case, all distributions
accumulated on all Series A Preferred Stock and all
classes and series of outstanding Parity Preferred
Stock have been paid in full. The foregoing sentence
will not prohibit (i) distributions payable solely in
equity securities ranking junior to the Series A
Preferred Stock as to distributions and rights upon
voluntary or involuntary dissolution,
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liquidation or winding up of the Company, (ii) the
conversion of Junior Stock or Parity Preferred Stock
into equity securities of the Company ranking junior
to the Series A Preferred Stock as to distributions
and rights upon voluntary or involuntary dissolution,
liquidation or winding-up of the Company, and (iii)
purchase by the Company of such Series A Preferred
Stock, Parity Preferred Stock or Junior Stock
pursuant to Article VII (Restriction on Transfer,
Acquisition and Redemption of Shares) of the Charter
to the extent required to preserve the Company's
status as a real estate investment trust.
(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 A Preferred Stock,
all distributions authorized and declared on the
Series A Preferred Stock and all classes or series of
outstanding Parity Preferred Stock shall be
authorized and declared so that the amount of
distributions authorized and declared per share of
Series A Preferred Stock and such other classes or
series of Parity Preferred Stock shall in all cases
bear to each other the same ratio that accrued
distributions per share on the Series A Preferred
Stock and such other classes or series of Parity
Preferred Stock (which shall not include any
accumulation in respect of unpaid distributions for
prior distribution periods if such class or series of
Parity Preferred Stock does not have cumulative
distribution rights) bear to each other.
(e) No Further Rights. Holders of Series A Preferred
Stock 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 4. LIQUIDATION PREFERENCE.
(a) Payment of Liquidating Distributions. Subject to
the rights of holders of Parity Preferred Stock with respect
to rights upon any voluntary or involuntary liquidation,
dissolution or winding-up of the Company and subject to equity
securities ranking senior to the Series A Preferred Stock with
respect to rights upon any voluntary or involuntary
liquidation, dissolution or winding-up of the Company, the
holders of Series A Preferred Stock shall be entitled to
receive out of the assets of the Company legally available for
distribution or the proceeds thereof, after payment or
provision for debts and other liabilities of the Company, but
before any payment or distributions of the assets shall be
made to holders of Common Stock or any other class or series
of equity securities of the Company that ranks junior to the
Series A Preferred Stock as to rights upon liquidation,
dissolution or winding-up of the Company, an amount equal to
the sum of (i) a liquidation preference of $25.00 per share of
Series A Preferred Stock, and (ii) an
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amount equal to any accumulated and unpaid distributions
thereon, whether or not declared, to the date of payment. In
the event that, upon such voluntary or involuntary
liquidation, dissolution or winding-up, there are insufficient
assets to permit full payment of liquidating distributions to
the holders of Series A Preferred Stock and any Parity
Preferred Stock, all payments of liquidating distributions on
the Series A Preferred Stock and such Parity Preferred Stock
shall be made so that the payments on the Series A Preferred
Stock and such Parity Preferred Stock shall in all cases bear
to each other the same ratio that the respective rights of the
Series A Preferred Stock and such other Parity Preferred Stock
(which shall not include any accumulation in respect of unpaid
distributions for prior distribution periods if such Parity
Preferred Stock does not have cumulative distribution rights)
upon liquidation, dissolution or winding-up of the Company
bear to each other.
(b) Notice. Written notice of any such voluntary or
involuntary liquidation, dissolution or winding-up of the
Company, 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 A Preferred Stock at the respective addresses of such
holders as the same shall appear on the share transfer records
of the Company.
(c) No Further Rights. After payment of the full
amount of the liquidating distributions to which they are
entitled, the holders of Series A Preferred Stock will have no
right or claim to any of the remaining assets of the Company.
(d) 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 Company to, or the consolidation or merger or
other business combination of the Company with or into any
corporation, trust or other entity (or of any corporation,
trust or other entity with or into the Company) shall not be
deemed to constitute a liquidation, dissolution or winding-up
of the Company.
(e) Permissible Distributions. In determining whether
a distribution (other than upon voluntary or involuntary
liquidation) by dividend, redemption, or other acquisition of
shares of stock of the Company or otherwise is permitted under
the MGCL, no effect shall be given to amounts that would be
needed, if the Company were to be dissolved at the time of the
distribution, to satisfy the preferential rights upon
dissolution of holders of shares of stock of the Company
whose preferential rights upon dissolution are superior to
those receiving the
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distribution.
SECTION 5. OPTIONAL REDEMPTION.
(a) Right of Optional Redemption. The Series A
Preferred Stock may not be redeemed prior to September 29,
2004. On or after such date, the Company shall have the right
to redeem the Series A Preferred Stock, in whole or in part,
at any time or from time to time, upon not less than thirty
(30) nor more than sixty (60) days written notice, at a
redemption price, payable in cash, equal to $25.00 per share
of Series A Preferred Stock plus accumulated and unpaid
distributions, whether or not declared, to the date of
redemption. If fewer than all of the outstanding shares of
Series A Preferred Stock are to be redeemed, the shares of
Series A Preferred Stock to be redeemed shall be selected pro
rata (as nearly as practicable without creating fractional
units).
(b) Limitation on Redemption.
(i) The redemption price of the Series A
Preferred Stock (other than the portion thereof
consisting of accumulated but unpaid distributions)
will be payable solely out of the sale proceeds of
capital stock of the Company and from no other
source. For purposes of the preceding sentence,
"capital stock" means any equity securities
(including Common Stock and Preferred Stock), shares,
participation or other ownership interests (however
designated) and any rights (other than debt
securities convertible into or exchangeable for
equity securities) or options to purchase any of the
foregoing.
(ii) The Company may not redeem fewer than
all of the outstanding shares of Series A Preferred
Stock unless all accumulated and unpaid distributions
have been paid on all outstanding Series A Preferred
Stock for all quarterly distribution periods
terminating on or prior to the date of redemption.
(c) Procedures for Redemption.
(i) Notice of redemption will be (i) faxed,
and (ii) mailed by the Company, postage prepaid, not
less than thirty (30) nor more than sixty (60) days
prior to the redemption date, addressed to the
respective holders of record of the Series A
Preferred Stock to be redeemed at their respective
addresses as they appear on the share transfer
records of the Company. No failure to give or defect
in such notice shall affect the validity of the
proceedings for the redemption of any Series A
Preferred Stock except as to the holder to whom
such notice was defective or not
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given. In addition to any information required by
law or by the applicable rules of any exchange upon
which the Series A Preferred Stock may be listed or
admitted to trading, each such notice shall state:
(i) the redemption date, (ii) the redemption price,
(iii) the number of shares of Series A Preferred
Stock to be redeemed, (iv) the place or places where
such shares of Series A Preferred Stock are to be
surrendered for payment of the redemption price, (v)
that distributions on the Series A Preferred Stock to
be redeemed will cease to accumulate on such
redemption date and (vi) that payment of the
redemption price and any accumulated and unpaid
distributions will be made upon presentation and
surrender of such Series A Preferred Stock. If fewer
than all of the shares of Series A Preferred Stock
held by any holder are to be redeemed, the notice
mailed to such holder shall also specify the number
of shares of Series A Preferred Stock held by such
holder to be redeemed.
(ii) If the Company gives a notice of
redemption in respect of Series A Preferred Stock
(which notice will be irrevocable) then, by 12:00
noon, New York City time, on the redemption date, the
Company will deposit irrevocably in trust for the
benefit of the Series A Preferred Stock being
redeemed funds sufficient to pay the applicable
redemption price, plus any accumulated and unpaid
distributions, if any, on such shares to the date
fixed for redemption, without interest, and will give
irrevocable instructions and authority to pay such
redemption price and any accumulated and unpaid
distributions, whether or not declared, if any, on
such shares to the holders of the Series A Preferred
Stock upon surrender of the Series A Preferred Stock
by such holders at the place designated in the notice
of redemption. If fewer than all Series A Preferred
Stock evidenced by any certificate is being redeemed,
a new certificate shall be issued upon surrender of
the certificate evidencing all Series A Preferred
Stock, evidencing the unredeemed Series A Preferred
Stock without cost to the holder thereof. On and
after the date of redemption, distributions will
cease to accumulate on the Series A Preferred Stock
or portions thereof called for redemption, unless the
Company defaults in the payment thereof. If any date
fixed for redemption of Series A Preferred Stock is
not a Business Day, then payment of the 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 redemption
price or any accumulated or unpaid distributions in
respect of the Series A Preferred Stock is
improperly withheld or refused and not paid by the
Company,
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distributions on such Series A Preferred Stock
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
applicable redemption price and any accumulated and
unpaid distributions.
(d) Status of Redeemed Stock. Any Series A Preferred
Stock that shall at any time have been redeemed shall after
such redemption, have the status of authorized but unissued
Preferred Stock, without designation as to class or series
until such shares are once more designated as part of a
particular class or series by the Board of Directors.
SECTION 6. VOTING RIGHTS.
(a) General. Holders of the Series A Preferred Stock
will not have any voting rights, except as set forth below.
(b) Right to Elect Directors.
(i) If at any time full distributions shall
not have been timely made on any Series A Preferred
Stock with respect to any six (6) prior quarterly
distribution periods, whether or not consecutive (a
"PREFERRED DISTRIBUTION DEFAULT"), the holders of
such Series A Preferred Stock, voting together as a
single class with the holders of each class or series
of Parity Preferred Stock upon which like voting
rights have been conferred and are exercisable
(collectively, the "PARITY SECURITIES"), will have
the right to elect two additional directors (and the
number of directors of the Company shall be deemed to
have increased by two (2)) to serve on the Company's
Board of Directors (the "PREFERRED STOCK DIRECTORS")
at a special meeting called by the holders of the
outstanding shares of Series A Preferred Stock in
accordance with Section 6(b)(ii) or at the next
annual meeting of stockholders, and at each
subsequent annual meeting of stockholders or special
meeting held in place thereof, until all such
distributions in arrears and distributions for the
current quarterly period on the Series A Preferred
Stock and each such class or series of Parity
Preferred Stock have been paid in full.
(ii) At any time when such voting rights
shall have vested, a proper officer of the Company
shall call or cause to be called, upon written
request of holders of record of at least 10% of the
outstanding shares of Series A Preferred Stock, a
special meeting of the holders of Series A Preferred
Stock and all the series of Parity Securities by
mailing or causing to be mailed to such holders a
notice of such special meeting to be
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held not less than ten and not more than 45 days
after the date such notice is given. The
record date for determining holders of the Parity
Securities entitled to notice of and to vote at such
special meeting will be the close of business on the
third Business Day preceding the day on which such
notice is mailed. At any such special meeting, all of
the holders of the Parity Securities, by plurality
vote, voting together as a single class without
regard to series will be entitled to elect two
directors on the basis of one vote per $25.00 of
liquidation preference to which such Parity
Securities are entitled by their terms (excluding
amounts in respect of accumulated and unpaid
dividends) and not cumulatively. The holder or
holders of one-third of the Parity Securities then
outstanding, present in person or by proxy, will
constitute a quorum for the election of the Preferred
Stock Directors except as otherwise provided by law.
Notice of all meetings at which holders of the Series
A Preferred Stock shall be entitled to vote will be
given to such holders at their addresses as they
appear in the share transfer records of the Company.
At any such meeting or adjournment thereof in the
absence of a quorum, subject to the provisions of any
applicable law, a majority of the holders of the
Parity Securities present in person or by proxy shall
have the power to adjourn the meeting for the
election of the Preferred Stock Directors, without
notice other than an announcement at the meeting,
until a quorum is present. If a Preferred
Distribution Default shall terminate after the notice
of a special meeting has been given but before such
special meeting has been held, the Company shall, as
soon as practicable after such termination, mail or
cause to be mailed notice of such termination to
holders of the Series A Preferred Stock that would
have been entitled to vote at such special meeting.
(iii) If and when all accumulated
distributions and the distribution for the current
distribution period on the Series A Preferred Stock
shall have been paid in full or a sum sufficient for
such payment is irrevocably deposited in trust for
payment, the holders of the Series A Preferred Stock
shall be divested of the voting rights set forth in
SECTION 6(B) herein (subject to revesting in the
event of each and every Preferred Distribution
Default) and, if all distributions in arrears and the
distributions for the current distribution period
have been paid in full or set aside for payment in
full on all other classes or series of Parity
Preferred Stock upon which like voting rights have
been conferred and are exercisable, the term and
office of each Preferred Stock Director so elected
shall terminate. Any Preferred Stock Director may be
removed at any time with or without cause by the vote
of, and shall not be removed otherwise than by the
vote of, the holders of record of a majority of the
outstanding Series A Preferred Stock when they have
the voting rights set
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forth in SECTION 6(B) (voting separately as a single
class with all other classes or series of Parity
Preferred Stock upon which like voting rights have
been conferred and are exercisable). So long as a
Preferred Distribution Default shall continue, any
vacancy in the office of a Preferred Stock Director
may be filled by written consent of the Preferred
Stock Director remaining in office or by a vote of
the holders of record of a majority of the
outstanding Series A Preferred Stock when they have
the voting rights set forth in SECTION 6(B) (voting
separately as a single class with all other classes
or series of Parity Preferred Stock upon which like
voting rights have been conferred and are
exercisable). The Preferred Stock Director shall each
be entitled to one vote per director on any matter.
(c) Certain Voting Rights. So long as any Series A
Preferred Stock remains outstanding, the Company shall not,
without the affirmative vote of the holders of at least
two-thirds of the Series A Preferred Stock outstanding at the
time (i) designate or create, or increase the authorized or
issued amount of, any class or series of shares ranking senior
to the Series A Preferred Stock with respect to payment of
distributions or rights upon liquidation, dissolution or
winding-up or reclassify any authorized shares of the Company
into any such shares, or create, authorize or issue any
obligations or security convertible into or evidencing the
right to purchase any such shares, (ii) designate or create,
or increase the authorized or issued amount of, any Parity
Preferred Stock or any stock which purports to be on parity
with the Series A Preferred Stock as to either (but not both)
distributions or rights upon dissolution, liquidation or
winding-up or reclassify any authorized shares of the Company
into any such shares, or create, authorize or issue any
obligations or security convertible into or evidencing the
right to purchase any such shares, but only to the extent such
Parity Preferred Stock is issued to an affiliate (as defined
in Section 11 of the Second Article of these Articles
Supplementary) of the Company unless such issuance is upon
terms determined by the Board of Directors (such determination
to include the affirmative approval of a majority of all
disinterested directors) to be no more favorable to the
holders thereof as it would offer in an arm's length
transaction to an unrelated third party, or (iii) either (A)
consolidate, merge into or with, or convey, transfer or lease
its assets substantially as an entirety, to any corporation or
other entity, or (B) amend, alter or repeal the provisions of
the Company's Charter (including these Articles Supplementary)
or By-laws, whether by merger, consolidation or otherwise, in
each case that would materially and adversely affect the
powers, special rights, preferences, privileges or voting
power of the Series A Preferred Stock or the holders thereof;
provided, however, that with respect to the occurrence of a
merger, consolidation or sale or lease of all of the Company's
assets as an entirety, so long as (a) the Company is the
surviving entity and the Series A Preferred Stock remains
outstanding with the terms thereof unchanged,
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<PAGE> 12
or (b) the resulting, surviving or transferee entity is a
corporation organized under the laws of any state and
substitutes for the Series A Preferred Stock other preferred
stock having substantially the same terms and same rights as
the Series A Preferred Stock, including with respect to
distributions, voting rights and rights upon liquidation,
dissolution or winding-up, then the occurrence of any such
event shall not be deemed to materially and adversely affect
the rights, privileges or voting powers of the holders of the
Series A Preferred Stock and provided further that any
increase in the amount of authorized Preferred Stock or the
creation or issuance of any other class or series of Preferred
Stock, or any increase in an amount of authorized shares of
each class or series, in each case ranking either (a) junior
to the Series A Preferred Stock with respect to payment of
distributions and the distribution of assets upon liquidation,
dissolution or winding-up, or (b) on a parity with the Series
A Preferred Stock with respect to payment of distributions or
the distribution of assets upon liquidation, dissolution or
winding-up, or both, to the extent such Preferred Stock (1) is
not issued to an affiliate of the Company, or (2) is issued to
an affiliate of the Company, other than upon terms determined
by the Board of Directors (such determination to include the
affirmative approval of a majority of all disinterested
directors) to be no more favorable to the holders thereof than
those it would offer in an arm's length transaction to an
unrelated third party, shall not be deemed to materially and
adversely affect such rights, preferences, privileges or
voting powers.
SECTION 7. TRANSFER RESTRICTIONS. The Series A
Preferred Stock shall be subject to the provisions of Article
VII (Restriction on Transfer, Acquisition and Redemption of
Shares) of the Charter.
SECTION 8. NO CONVERSION RIGHTS. The holders of
the Series A Preferred Stock shall not have any rights to
convert such shares into shares of any other class or series
of stock or into any other securities of, or interest in, the
Company.
SECTION 9. NO SINKING FUND. No sinking fund
shall be established for the retirement or redemption of
Series A Preferred Stock.
SECTION 10. NO PREEMPTIVE RIGHTS. No holder of
the Series A Preferred Stock of the Company shall, as such
holder, have any preemptive rights to purchase or subscribe
for additional shares of stock of the Company or any other
security of the Company which it may issue or sell.
SECTION 11. DEFINITION OF AFFILIATE. For the
purposes of these Articles Supplementary, the term
"AFFILIATE" shall mean any person or entity which directly
or indirectly through one or more intermediaries controls,
is controlled by or is under common control with the Company,
or its permitted successor.
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<PAGE> 13
THIRD: The Series A Preferred Stock has been classified and
designated by the Board of Directors under the authority contained in
the Charter.
FOURTH: These Articles Supplementary have been approved by
the Board of Directors of the Company in the manner and by the vote
required by law.
(SIGNATURE APPEARS ON NEXT PAGE)
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<PAGE> 14
IN WITNESS WHEREOF, Sun Communities, Inc. has caused these Articles
Supplementary to be signed and acknowledged in its name and on its behalf by the
undersigned duly authorized officer and attested to by its Secretary on this
29th day of September, 1999; and such officer acknowledges that these Articles
Supplementary are the act of Sun Communities, Inc., and he further acknowledges
that, as to all matters or facts set forth herein which are required to be
verified under oath, such matters and facts are true in all material respects to
the best of his knowledge, information and belief, and that this statement is
made under the penalties for perjury.
SUN COMMUNITIES, INC.
By: /s/ Mary A. Petrella
---------------------
Name: Mary A. Petrella
Title: Vice President
[SEAL]
ATTEST:
Name: /s/ Jeffrey P. Jorissen
-----------------------
Secretary
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<PAGE> 1
EXHIBIT 99.1
CONTRIBUTION AGREEMENT
BY AND AMONG
BELCREST REALTY CORPORATION
AND
BELAIR REAL ESTATE CORPORATION
AND
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
AND
SUN COMMUNITIES, INC.
Dated: As of September 29, 1999
<PAGE> 2
CONTRIBUTION AGREEMENT
THIS CONTRIBUTION AGREEMENT (this "AGREEMENT") is made as of September
29, 1999 ("AGREEMENT DATE"), by and among BELCREST REALTY CORPORATION, a
Delaware corporation and BELAIR REAL ESTATE CORPORATION, a Delaware corporation
(the "CONTRIBUTORS"), and SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP, a
Michigan limited partnership (the "OPERATING PARTNERSHIP") and SUN COMMUNITIES,
INC., a Maryland corporation (the "COMPANY").
RECITALS
WHEREAS, Contributors desire to contribute to Operating Partnership
cash in return for Preference Units in Operating Partnership on the terms and
conditions herein set forth.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereby agree as follows:
1. DEFINITIONS. For purposes of this Agreement, the following
terms shall have the meanings set forth below:
"AFFILIATE" means with respect to any Person, any other Person
controlled by, controlling or under common control with such Person.
For purposes hereof, "control" shall include the power to direct the
actions of a Person, regardless of whether the same shall involve an
ownership interest in such Person.
"AGREEMENT" has the meaning set forth in the initial paragraph
hereof.
"AGREEMENT DATE" has the meaning set forth in the initial
paragraph hereof.
"AGREEMENT OF LIMITED PARTNERSHIP" means the Second Amended
and Restated Limited Partnership Agreement of Sun Communities Operating
Limited Partnership, dated as of April 30, 1996, as amended by (i)
those certain amendments numbered one through one hundred two, and (ii)
the Amendment; and as further amended from time to time.
"AMENDMENT" means the One Hundred Third Amendment to the
Agreement of Limited Partnership, dated as of the date hereof,
substantially in the form attached hereto as EXHIBIT A.
"ARTICLES SUPPLEMENTARY" means the Articles Supplementary of
the Company
<PAGE> 3
substantially in the form attached hereto as EXHIBIT B.
"BELAIR" means Belair Real Estate Corporation.
"BELCREST" means Belcrest Realty Corporation.
"BROKER" has the meaning set forth in PARAGRAPH 10.
"BYLAWS" means the Bylaws of the Company, as amended from time
to time.
"CHARTER" means the Articles of Amendment and Restatement of
the Company, recorded on November 8, 1993, with the State of Maryland
Department of Assessments and Taxation (the "SMDAT"), as amended by (i)
that certain Articles of Amendment, recorded on June 20, 1997, with the
SMDAT, (ii) Articles Supplementary, recorded on June 2, 1998, with the
SMDAT, and (iii) the Articles Supplementary, and as further amended and
restated from time to time.
"CLOSING" has the meaning set forth in PARAGRAPH 6(A).
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMPANY" has the meaning set forth in the initial paragraph
hereof.
"CONTRIBUTION AMOUNT" means $50,000,000 US$, such amount to be
contributed severally $15,000,000 US$ by Belair and $35,000,000 US$ by
Belcrest.
"CONTRIBUTORS" has the meaning set forth in the initial
paragraph hereof.
"CONTRIBUTORS' CLOSING DOCUMENTS" has the meaning set forth in
PARAGRAPH 6(C).
"ERISA" means the Employee Retirement Income Securities Act of
1974, as amended.
"EXCHANGE DATE" means, with respect to any Preference Unit,
the date on which the exchange of such Preference Unit for Preferred
Stock shall occur in accordance with the Agreement of Limited
Partnership.
"FINANCING AGREEMENTS" means collectively, that certain (i)
Indenture, dated as of April 24, 1996, by and among the Company, the
Operating Partnership and Bankers Trust Company, (ii) $25,500,000
Facility and Guaranty Agreement, dated as of December 10, 1998, by and
among the Company, the Operating Partnership, certain subsidiary
guarantors named therein, The First National Bank of Chicago and
certain
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<PAGE> 4
other lenders named therein, and (iii) Amended and Restated Senior
Unsecured Line of Credit Agreement, dated as of July 1, 1999, by and
among the Company, the Operating Partnership, Lehman Brothers Holdings
Inc., The First National Bank of Chicago, First Union National Bank,
Michigan National Bank, PNC Bank, Ohio, National Association and
Pacific Life Insurance Company.
"GAAP" means generally accepted accounting principles
consistently applied.
"GOVERNING DOCUMENTS" means, with respect to (i) a limited
partnership, such limited partnership's certificate of limited
partnership and the agreement of limited partnership, and any
amendments or modifications of any of the foregoing; (ii) a
corporation, such corporation's articles or certificate of
incorporation, by-laws and any applicable authorizing resolutions, and
any amendments or modifications of any of the foregoing; (iii) a
limited liability company, such limited liability company's articles or
certificate of organization, by-laws and operating agreement or
agreement of limited liability company, and any amendments or
modifications of any of the foregoing; and (iv) a trust, such trust's
declaration of trust and by-laws and any amendments or modifications of
any of the foregoing.
"MANAGER" means Boston Management and Research, a
Massachusetts business trust.
"OPERATING PARTNERSHIP" has the meaning set forth in the
initial paragraph hereof.
"OPERATING PARTNERSHIP'S CLOSING DOCUMENTS" has the meaning
set forth in PARAGRAPH 6(B).
"PARITY PREFERRED STOCK" has the meaning ascribed to such term
in the Articles Supplementary.
"PARTNER" has the meaning ascribed to such term in the
Agreement of Limited Partnership.
"PERSON" means a natural person, partnership (whether general
or limited), trust, estate, association, corporation, limited liability
company, unincorporated organization, custodian, nominee or any other
individual or entity in its own or representative capacity.
"PREFERENCE UNITS" shall have the meaning ascribed to "Series
A Preferred Units" in the Amendment.
"PREFERRED STOCK" means the Company's 9.125% Series A
Cumulative Redeemable Perpetual Preferred Stock upon terms and
provisions set forth in the ARTICLES
3
<PAGE> 5
SUPPLEMENTARY.
"PTP" means a "publicly traded partnership" within the meaning
of Section 7704 of the Code.
"REGISTRATION RIGHTS AGREEMENT" has the meaning set forth in
PARAGRAPH 6(B)(IV) hereof.
"REIT" has the meaning set forth in PARAGRAPH 8(G) hereof.
"SEC" means the Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SUBSIDIARY" means with respect to any Person, any
corporation, partnership, limited liability company, joint venture or
other entity of which a majority of (i) voting power of the voting
equity securities or (ii) the outstanding equity interests, is owned,
directly or indirectly, by such Person.
"US$" means United States dollars, lawful money of the United
States of America.
2. CONTRIBUTION OF CASH. Subject to the terms and provisions of
this Agreement, Belcrest and Belair each hereby agrees to contribute to
Operating Partnership their portion of the Contribution Amount by wire transfer
of immediately available funds to an account designated by the Company on the
date of the Closing in consideration for Preference Units in Operating
Partnership. Subject to the terms and provisions of this Agreement, Operating
Partnership hereby agrees to accept the Contribution Amount and to issue to
Belair and Belcrest 600,000 and 1,400,000, respectively, Preference Units in
exchange therefor.
3. CONDITIONS TO CLOSING.
(a) Conditions to Operating Partnership's and Company's
Obligations. Operating Partnership's and Company's obligations under this
Agreement to accept the Contribution Amount, provide each Contributor with
Preference Units and otherwise consummate the transactions contemplated hereby
are subject to the satisfaction (or waiver in writing by Operating Partnership
and the Company) of the following conditions on or before the Closing:
(i) No Injunction. No temporary restraining order or
preliminary or permanent injunction of any court or
administrative agency of competent jurisdiction
prohibiting the consummation of the transactions
contemplated hereby shall be in effect.
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<PAGE> 6
(ii) Accuracy of Representations and Warranties. The
representations and warranties of Contributors
contained in this Agreement shall be true and correct
in all material respects on the date of the Closing
with the same effect as though made on the date of
the Closing.
(iii) Performance of Agreement. Each Contributor shall have
performed, in all material respects, all of its
respective covenants, agreements and obligations
required by this Agreement to be performed or
complied with by it prior to or at the Closing,
including, without limitation, delivery of the
Contribution Amount.
(iv) Delivery of Closing Documents. Operating Partnership
and Company shall have received the Contributors'
Closing Documents.
If for any reason any of the conditions set forth in this PARAGRAPH
3(A) or elsewhere in this Agreement are not satisfied or waived by Operating
Partnership and Company at or prior to the Closing, then, at Operating
Partnership's or Company's option, this Agreement shall be terminated and
Operating Partnership, Company and Contributors shall be released from their
obligations under this Agreement and none of Operating Partnership, Company or
Contributors shall have any further liability hereunder.
(b) Conditions to Contributors' Obligations. Contributors'
obligations under this Agreement to deliver the Contribution Amount and
otherwise consummate the transactions contemplated hereby are subject to the
satisfaction (or waiver in writing by Contributors) of the following conditions
on or before the Closing:
(i) No Injunction. No temporary restraining order or
preliminary or permanent injunction or any court or
administrative agency of competent jurisdiction
prohibiting the consummation of the transactions
contemplated hereby shall be in effect.
(ii) Accuracy of Representations and Warranties. The
representations and warranties of Operating
Partnership and Company contained in this Agreement
shall be true and correct in all material respects on
the date of the Closing with the same effect as
though made on the date of the Closing.
(iii) Performance of Agreement. Operating Partnership and
Company shall have performed, in all material
respects, all of their respective covenants,
agreements and obligations required by this Agreement
to be performed or complied with by it prior to or at
the Closing.
(iv) Delivery of Closing Documents. Contributors shall
have received the
5
<PAGE> 7
Operating Partnership's Closing Documents.
If for any reason any of the conditions set forth in this PARAGRAPH
3(B) or elsewhere in this Agreement are not satisfied or waived by Contributors
at or prior to the Closing, then, at Contributors' option, this Agreement shall
be terminated and Contributors, Operating Partnership and Company shall be
released from their obligations under this Agreement and none of Contributors,
Operating Partnership or Company shall have any further liability hereunder.
4. COVENANTS.
(a) On the Exchange Date, the Company shall issue shares of
Preferred Stock in the Company in a number equal to the number of shares of
Preferred Stock into which the Preference Units are exchangeable pursuant to the
terms of the Agreement of Limited Partnership. Upon consummation of such
exchange in accordance with the terms of the Agreement of Limited Partnership,
and issuance in accordance with the Charter, such shares of Preferred Stock
shall be validly issued, fully paid and non-assessable.
(b) Operating Partnership covenants to notify holders of
Preference Units promptly (i) in the event it anticipates or realizes that the
value of its assets constituting "stock and securities" within the meaning of
Section 351(e)(1) of the Code will equal 10% or more of its total assets and
(ii) in the event it anticipates or realizes that there is a material increase
in such percentage of Operating Partnership's assets constituting "stock and
securities" if immediately preceding such material increase the percentage of
Operating Partnership's assets constituting "stock and securities" within the
meaning of Section 351(e)(1) of the Code equals 10% or more of the Operating
Partnership's total assets.
(c) Company agrees that it will notify holders of Preference Units
promptly in the event it becomes aware of any facts that will or likely will
cause Operating Partnership to become a PTP on or after January 1, 2000.
(d) Through the end of 1999, Operating Partnership: (i) shall
take all actions reasonably available to it under the Agreement of Limited
Partnership as presently in effect to avoid treatment as a PTP; and (ii) shall
at all times satisfy the private placement safe harbor of Notice 88-75 (1988-2
C.B. 386) taking into account any person treated as a partner within the meaning
of Notice 88-75 (including each person indirectly owning an interest through a
partnership, a grantor trust, or an S corporation) and substituting "400" for
"500". The Operating Partnership further (A) represents that it (i) was actively
engaged in an activity before December 4, 1995, (ii) did not add a substantial
new line of business after December 4, 1995 and (iii) has no plan or intention
to add a substantial new line of business and (B) covenants that it shall (i)
not add a substantial new line of business within the meaning of Section
1.7704-1(1)(3) prior to January 1, 2000 and (ii) shall promptly provide notice
to the holders of the Preference Units in the event that the Operating
Partnership plans or intends to add a substantial new line of business at any
time after January 1, 2000.
6
<PAGE> 8
(e) The Operating Partnership covenants that, for each taxable
year during which the Purchaser holds Preference Units, ninety percent (90%) or
more of the gross income of the Operating Partnership for such taxable year
shall constitute "qualifying income" within the meaning of Section 7704(d) of
the Code.
(f) Operating Partnership covenants that it shall deliver to
holders of Preference Units the following:
(i) as soon as available, but in no event later than
ninety (90) days following the end of each fiscal year of Operating
Partnership, a complete copy of Operating Partnership's audited
financial statements including a balance sheet, income statement and
cash flow statement for such fiscal year prepared and audited by an
independent certified public accountant in accordance with GAAP (which
requirement, if the Operating Partnership is required to file
disclosure statements with the SEC, shall be deemed to be satisfied
upon the delivery to holders of Preference Units of Operating
Partnership's Annual Report on Form 10-K, within five (5) business days
of its filing with the SEC); and
(ii) as soon as possible, but in no event later than
forty-five (45) days following the end of each fiscal quarter of
Operating Partnership, a complete copy of Operating Partnership's
unaudited quarterly financial statements including a balance sheet,
income statement and cash flow statement for such fiscal quarter
prepared in accordance with GAAP (except with respect to
footnotes)(which requirement, if the Operating Partnership is required
to file disclosure statements with the SEC, shall be deemed to be
satisfied upon the delivery to holders of Preference Units of Operating
Partnership's Quarterly Report on Form 10-Q, within five (5) business
days of its filing with the SEC); and
(iii) on a quarterly basis (as soon as possible, but in no
event later than sixty (60) days following the end of each fiscal
quarter of Operating Partnership) a reasonable good faith written
estimate (it being understood and agreed that such estimate shall be
prepared as if it were being prepared solely for the use of Company and
Operating Partnership and that such preparation shall not take into
account any use by, or benefit of, the Contributors) together with
reasonable supporting information of the percentage of Operating
Partnership's assets (by value) that are within the relevant categories
of Section 856(c)(4) of the Code.
(iv) on an annual basis (as soon as possible, but in no event
later than ninety (90) days following the end of each fiscal year of
Operating Partnership) a reasonable good faith written estimate (it
being understood and agreed that such estimate shall be prepared as if
it were being prepared solely for the use of Company and Operating
Partnership and that such preparation shall not take into account any
use by, or benefit of,
7
<PAGE> 9
the Contributors) together with reasonable supporting information of
the percentage of Operating Partnership's gross income that is derived
from sources enumerated in Section 856(c)(2) and (3), respectively, of
the Code.
(g) Provided that all other conditions to Operating Partnership's
and Company's obligations set forth in this Agreement have been satisfied or
properly waived, Operating Partnership covenants that it shall record
Contributors as the holders of the Preference Units on its books and records and
shall admit Contributors as limited partners to Operating Partnership on the
Closing Date.
(h) Operating Partnership shall not issue any Preference Units to
any Person other than Contributors and Company shall not issue any Preferred
Stock to any Person other than a holder of Preference Units upon exchange of
such Preference Units.
(i) Operating Partnership covenants and agrees for the benefit of
the holders of the Preference Units that, the income and assets of the Operating
Partnership will be such as would permit the Operating Partnership to satisfy
the income and assets requirements of Section 856 of the Code if the Operating
Partnership were a REIT.
(j) Upon request of any Contributor, from time to time (provided
that such request is not made more often than six times during any given
calendar year), Operating Partnership and Company agree to deliver a certificate
to such Contributor bringing down the representation and warranties made by
Operating Partnership and Company in PARAGRAPHS 8(D), 8(E), 8(F) and 8(G) to a
date requested by a Contributor to the extent, after due inquiry, Operating
Partnership and Company can make such representations and warranties as of such
date.
(k) The Company shall not undertake any action, including the
issuance of any securities, without the consent of the holders of the Preference
Units, if such action would require the consent of the holders of the Preferred
Stock if any shares of the Preferred Stock were outstanding at the time of such
action.
(l) The Company shall cause the Articles Supplementary to be filed
with the SMDAT and shall deliver within two (2) business days after Closing a
copy of the Articles Supplementary certified as filed with the SMDAT.
The covenants set forth in this PARAGRAPH 4 shall survive the Closing.
5. TRANSACTION COSTS. Except as otherwise specifically set forth
herein, each of the parties hereto shall bear its own costs and expenses with
respect to the transaction contemplated hereby.
6. CLOSING.
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<PAGE> 10
(a) The closing of the transactions contemplated by this Agreement
shall be consummated on September 29, 1999 (the "CLOSING").
(b) At the Closing, Operating Partnership and Company shall
deliver to Contributors the following documents and the following other items
(the documents and other items described in this PARAGRAPH 6(B) being
collectively referred to herein as the "OPERATING PARTNERSHIP CLOSING
DOCUMENTS"):
(i) This Agreement duly executed and delivered by
Operating Partnership and Company;
(ii) The Amendment, duly executed and delivered by all
persons necessary to make such amendment binding on and enforceable
against all Partners in Operating Partnership;
(iii) The Articles Supplementary of the Company, duly
executed and delivered by the Company and in proper form for filing
with the SMDAT.
(iv) The Registration Rights Agreement, in the form set
forth on EXHIBIT C, duly executed and delivered by Company;
(v) A Certificate of the Secretary of Company
substantially in the form set forth on EXHIBIT D together with
completed exhibits attached thereto, executed by the secretary of the
Company and dated as of the date of the Closing;
(vi) An opinion of counsel to Company and Operating
Partnership substantially in the form set forth on EXHIBIT E;
(vii) Cross-Receipts, substantially in the form set forth
on EXHIBITS F-1 and F-2; and
(viii) Certificates representing the Preference Units for
each Contributor;
(ix) Written Consent of a majority of the Preferred OP
Unit (as defined in the Agreement of Limited Partnership) holders
(excluding the holders of the Preference Units) to the issuance of the
Preference Units; and
(x) Those other closing documents required to be executed
by it or as may be otherwise necessary or appropriate to consummate the
transaction contemplated hereby.
(c) At the Closing, Contributors shall deliver to Operating
Partnership and Company the following documents and the following other items
(the documents and other items described in this PARAGRAPH 6(C) being
collectively referred to herein as the "CONTRIBUTORS' CLOSING
9
<PAGE> 11
DOCUMENTS"):
(i) Counterparts of those documents listed in PARAGRAPH
6(B)(I), (II), (IV), and (VII), duly executed and delivered by
Contributors.
(ii) Those other closing documents required to be executed
by it or as may be otherwise necessary or appropriate to consummate the
transaction contemplated hereby.
7. REPRESENTATIONS AND WARRANTIES OF CONTRIBUTORS. Contributors
make the following representations and warranties to Operating Partnership and
Company, all of which (except as otherwise designated) are true and correct in
all material respects on the Agreement Date and shall be true and correct in all
material respects as of the date of the Closing:
(a) Contributors are duly organized and validly existing
under the laws of the state of their organization and have been duly
authorized by all necessary and appropriate action to enter into this
Agreement and to consummate the transactions contemplated hereby. This
Agreement is a valid and binding obligation of Contributors,
enforceable against Contributors in accordance with its terms, except
insofar as enforceability may be affected by bankruptcy, insolvency or
similar laws affecting creditor's rights generally and the availability
of any particular equitable remedy.
(b) Neither the execution nor the delivery of this
Agreement nor the consummation of the transactions contemplated hereby
nor fulfillment of or compliance with the terms and conditions hereof
(a) conflict with or will result in a breach of any of the terms,
conditions or provisions of (i) the Governing Documents of Contributors
or (ii) any agreement, order, judgment, decree, arbitration award,
statute, regulation or instrument to which either Contributor is a
party or by which it or its assets are bound, or (b) constitutes or
will constitute a breach, violation or default under any of the
foregoing. No consent or approval, authorization, order, regulation or
qualification of any governmental entity or any other Person is
required for the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby by Contributors.
(c) Contributors acknowledge that the Preference
Units have not been and will not be registered or qualified under the
Securities Act or any state securities laws and are offered in reliance
upon an exemption from registration under Regulation D of the
Securities Act and similar state law exceptions. The Preference Units
to be received by Contributors hereunder shall be held by Contributors
for investment purposes only for their own account, and not with a view
to or for sale in connection with any distribution of the Preference
Units, and Contributors acknowledge that the Preference Units cannot be
sold or otherwise disposed of by the holders thereof unless they are
subsequently registered under the Securities Act or pursuant to an
exemption therefrom; and the Preference Units may not be sold, assigned
or otherwise transferred except in compliance
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<PAGE> 12
with the Agreement of Limited Partnership. Contributors hereby
acknowledge receipt of a copy of the Agreement of Limited Partnership,
as amended through the date hereof, and represent that they have
reviewed same and understand the provisions thereof which have a
bearing on the representations made in this PARAGRAPH 7(C).
(d) Contributors have no contract, understanding,
agreement or arrangement with any Person to sell, transfer or grant a
participation to such Person or any other Person, with respect to any
or all of the Preference Units they will receive in accordance with the
provisions hereof.
(e) Each Contributor is an "accredited investor" within
the meaning of Regulation D under the Securities Act and has knowledge
and experience in financial and business matters such that it is
capable of evaluating the merits and risks of receiving and owning the
Preference Units and Contributors are able to bear the economic risk of
such ownership and understands that an investment in Preference Units
involves substantial risks.
(f) Neither Contributor is an employee benefit plan
subject to ERISA or Section 4975 of the Code.
(g) In making this investment, Contributors are relying
upon the advice of their own personal, legal and tax advisors with
respect to the tax and other aspects of an investment in Operating
Partnership.
(h) There is no action, suit, proceeding or, to
Contributors' knowledge, currently threatened against Contributors that
questions the validity of this Agreement or the right of Contributors
to enter into this Agreement or to consummate the transactions
contemplated hereby.
(i) For such time as a Contributor holds an interest in
the Operating Partnership, such Contributor will be treated for federal
income tax purposes as either a real estate investment trust or a C
corporation (and not as an S corporation or a division of another
corporation, unless such other corporation complies with this covenant
and agreement).
(j) There has been made available to Contributors and
their respective advisors the opportunity to ask questions of, and
receive answers from, the Operating Partnership and the Company
concerning the terms and conditions of the investment in the Preference
Units and any other matters pertaining to the Operating Partnership
and/or the Company. Contributors have had an opportunity to consult
with counsel and other advisors about the investment in the Preference
Units and all material documents, records and books pertaining to such
investment have, upon request, been made available to Contributors and
their respective advisors.
11
<PAGE> 13
Contributors hereby expressly permit JAFFE, RAITT, HEUER &
WEISS, P.C., as counsel to the Operating Partnership and the Company,
to rely upon the representations and warranties set forth above as if
such representations and warranties were made by Contributors directly
to JAFFE, RAITT, HEUER & WEISS, P.C.
8. REPRESENTATIONS AND WARRANTIES OF OPERATING PARTNERSHIP AND
COMPANY. Operating Partnership and Company make the following representations
and warranties to Contributors and Manager, all of which (except as otherwise
designated) are true and correct in all material respects on the Agreement Date
and shall be true and correct in all material respects as of the date of the
Closing:
(a) Operating Partnership is duly organized and validly
existing under the laws of the state of its organization and is duly
registered and qualified to do business in each jurisdiction where such
registration or qualification is material to the transactions
contemplated hereby and has been duly authorized by all necessary and
appropriate action to enter into this Agreement, to issue, sell and
deliver the Preference Units and to consummate the transactions
contemplated hereby, and the individuals executing this Agreement on
behalf of Operating Partnership have been duly authorized by all
necessary and appropriate action on behalf of Operating Partnership.
This Agreement is a valid and binding obligation of Operating
Partnership, enforceable against Operating Partnership in accordance
with its terms, except insofar as enforceability may be affected by
bankruptcy, insolvency or similar laws affecting creditor's rights
generally and the availability of any particular equitable remedy.
(b) Company is duly organized and validly existing
under the laws of the state of its organization and is duly registered
and qualified to do business in each jurisdiction where such
registration or qualification is material to the transactions
contemplated hereby and has been duly authorized by all necessary and
appropriate action to enter into this Agreement, to issue and deliver,
upon exchange of the Preference Units in accordance with the Agreement
of Limited Partnership, the Preferred Stock and to consummate the
transactions contemplated hereby, and the individuals executing this
Agreement on behalf of Company have been duly authorized by all
necessary and appropriate action on behalf of Company. This Agreement
is a valid and binding obligation of Company, enforceable against
Company in accordance with its terms, except insofar as enforceability
may be affected by bankruptcy, insolvency or similar laws affecting
creditor's rights generally and the availability of any particular
equitable remedy.
(c) Neither the execution nor the delivery of this Agreement
nor the consummation of the transactions contemplated hereby nor
fulfillment of or compliance with the terms and conditions hereof (a)
conflict with or will result in a breach of any of the terms,
conditions or provisions of (i) the Governing Documents of Company or
12
<PAGE> 14
Operating Partnership or any of its general partners or (ii) any
agreement, order, judgment, decree, arbitration award, statute,
regulation or instrument to which Company or Operating Partnership is a
party or by which it or its assets are bound, or (b) constitutes or
will constitute a breach, violation or default under any of the
foregoing. No consent or approval, authorization, order, registration
or qualification of any governmental entity or any other Person is
required for the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby by Operating
Partnership or Company, except for filings under state securities law
or "blue sky" laws (provided such would not have a material adverse
affect on the Company or the transaction contemplated by this
Agreement).
(d) Immediately following the issuance of the Preference
Units pursuant to this Agreement, less than 8% of the value of
Operating Partnership's assets will consist of "stock and securities"
within the meaning of Section 351(e)(1) of the Code and Operating
Partnership has no plan to increase the amount of its assets
constituting "stock and securities" to a percentage equal to or greater
than 10% (except for short-term cash equivalents and other short-term
assets arising from the temporary investment of stock or debt issuance
proceeds).
(e) Operating Partnership has not been and is not
currently a PTP.
(f) Neither the Company nor any Subsidiary of Company has
any present plan or intention, and neither the Company nor any
Subsidiary of Company has any actual knowledge of any present plan or
intention of any partner in Operating Partnership, to take any action
or actions that would or would likely result in Operating Partnership
becoming a PTP in the foreseeable future. Neither Company nor any
Subsidiary of Company has actual knowledge of facts that reasonably
would cause it to expect that Operating Partnership would or would
likely become a PTP in the foreseeable future.
(g) The Company has properly elected to be taxable as a
real estate investment trust (a "REIT") under and in accordance with
Sections 856 to 860 of the Code, currently qualifies for taxation as a
REIT and has no plan or intention or knowledge of facts that would
likely cause it to fail to qualify for taxation as a REIT in the
foreseeable future.
(h) The Preferred Stock issuable upon exchange of the
Preference Units in accordance with the Agreement of Limited
Partnership have been duly and validly reserved for issuance, and upon
issuance in accordance with this Agreement, the Agreement of Limited
Partnership and the Charter, shall be duly and validly issued, fully
paid and non-assessable. The Preference Units have been duly authorized
and upon contribution of the Contribution Amount to the Operating
Partnership will be validly issued, fully paid and non-assessable.
(i) Neither the issuance, sale or delivery of the
Preference Units nor, upon
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<PAGE> 15
exchange, the issuance and delivery of the Preferred Stock, is subject
to any preemptive right of any Partner of Operating Partnership arising
under law or the Agreement of Limited Partnership or any stockholder of
the Company arising under applicable law or the Charter or Bylaws, or
to any contractual right of first refusal or other right in favor of
any Person. With the exception of the Charter and the Agreement of
Limited Partnership, there are no agreements or understandings in
effect restricting the voting rights, the distribution rights (except
with respect to the Financing Agreements) or any other rights of the
holders of the Preference Units, or upon exchange, the Preferred Stock.
(j) There is no action, suit, proceeding or investigation
pending or, to the knowledge of the Company or the Operating
Partnership, currently threatened against Operating Partnership or
Company that questions the validity of this Agreement or the right of
Operating Partnership or Company to enter into this Agreement, and to
consummate the transactions contemplated hereby, or that would
reasonably be expected to, either individually or in the aggregate,
have a material adverse affect on the business, capitalization,
operations, properties or condition (financially or otherwise) of
Operating Partnership or Company, or result in any change in the
current equity ownership of Operating Partnership or Company, nor is
Company or Operating Partnership aware that there is any basis for the
foregoing.
(k) Neither Operating Partnership nor Company is in
conflict with, or in default or violation of (i) any law, rule,
regulation, order, judgment or decree applicable to it or by which any
of its properties or assets is bound or affected, or (ii) any note,
bond, mortgage, indenture or obligation to which it is a party or by
which Operating Partnership or Company or any property or asset of
Company or Operating Partnership is bound or affected, except for any
such conflicts, defaults or violations that would not reasonably be
expected to, individually or in the aggregate, have a material adverse
effect on the business, operations, properties or condition
(financially or otherwise) of Operating Partnership or Company.
(l) Partnership and Company hereby consent to
any pledge and release of such pledge of the Preference Units subject
to and in accordance with the Agreement of Limited Partnership, and to
any pledge and release of such pledge of any Preferred Stock into which
such Preference Units are exchanged, to secure the obligations of
Contributors.
(m) Operating Partnership has no plan or present
intention of merging, consolidating, or selling or leasing all of its
assets as an entirety, where the resulting, surviving or transferee
entity is a corporation or otherwise not a pass-through entity.
Operating Partnership and Company hereby expressly permit Shearman &
Sterling, as counsel to Contributors and Manager, to rely upon the
representations and warranties set forth in this PARAGRAPH 8 as if such
representations and warranties were made by Operating Partnership
14
<PAGE> 16
and Company directly to Shearman & Sterling.
9. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties set forth in PARAGRAPHS 7 and 8 shall survive the
Closing.
10. BROKERS. Each party represents and warrants to the other that
it has dealt with no broker, finder or other person (collectively, "BROKER")
with respect to this Agreement or the transactions contemplated hereby and that
no Broker is entitled to a commission as a result of this transaction, except
for Donaldson, Lufkin & Jenrette Securities Corporation. Operating Partnership
is responsible for the commission to Donaldson, Lufkin & Jenrette Securities
Corporation pursuant to a separate agreement. Each of (a) Operating Partnership
and Company, severally and not jointly, on the one hand, and (b) Contributors on
the other hand, agree to indemnify and hold harmless the other party against any
loss, liability, damage, expense or claim incurred by reason of any brokerage
commission or finder's fee alleged to be payable because of any act, omission or
statement of the indemnifying party. Such indemnity obligation shall be deemed
to include the payment of reasonable attorney's fees and court costs incurred in
defending any such claim. The provisions of this PARAGRAPH 10 shall survive the
Closing.
11. COMPLETE AGREEMENT. This Agreement represents the entire
agreement between Contributors, Operating Partnership and Company covering
everything agreed upon or understood in this transaction and all other prior
agreements, written or oral, including any prior subscription agreements or
letters, are merged into this Agreement. There are no oral promises, conditions,
representations, understandings, interpretations or terms of any kind as
conditions or inducements to the execution hereof in effect between the parties.
No change or addition shall be made to this Agreement except by a written
agreement executed by Contributors, Operating Partnership and Company.
12. AUTHORIZED SIGNATORIES. The persons executing this Agreement
for and on behalf of Contributors, Operating Partnership and Company each
represent that they have the requisite authority to bind the entities on whose
behalf they are signing.
13. PARTIAL INVALIDITY. If any term, covenant or condition of this
Agreement is held to be invalid or unenforceable in any respect, such invalidity
or unenforceability shall not affect any other provision hereof, and this
Agreement shall be construed as if such invalid or unenforceable provision had
never been contained herein.
14. MISCELLANEOUS.
(a) Governing Law. This Agreement shall be interpreted
and enforced according to the laws of the State of Michigan.
(b) Headings; Sections. All headings in this Agreement
are inserted for convenience only and do not form part of this
Agreement or limit, expand or otherwise
15
<PAGE> 17
alter the meaning of any provisions hereof.
(c) Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original
and all of which shall constitute one and the same agreement. Facsimile
signatures shall be deemed effective execution of this Agreement and
may be relied upon as such by the other party. In the event facsimile
signatures are delivered, originals of such signatures shall be
delivered to the other party within three (3) business days after
execution.
(d) No Benefit For Third Parties. The provisions of this
Agreement are intended to be for the sole benefit of the parties hereto
and their respective successors and permitted assigns, and none of the
provisions of this Agreement are intended to be, nor shall they be
construed to be, for the benefit of any third party.
(e) Rights and Obligations. The rights and obligations of
Contributors, Operating Partnership and Company shall inure to the
benefit of and be binding upon the parties hereto and their respective
successors and permitted assigns.
(f) Limitation of Liability. The liability of
Contributors hereunder shall be limited to the Contribution Amount.
15. NOTICES. All notices and other communications required or
permitted to be given hereunder shall be in writing and shall be deemed to have
been duly given if personally delivered, delivered by nationally recognized
overnight courier with proof of delivery thereof, sent by United States
registered or certified mail (postage prepaid, return receipt requested)
addressed as hereinafter provided or via telephonic facsimile transmission with
proof of delivery in the form of a facsimile transmission confirmation report.
Notice shall be sent and deemed given when (a) if personally delivered or via
nationally recognized overnight courier, then upon receipt by the receiving
party, or (b) if mailed, then three (3) days after being postmarked, or (c) if
sent via telephonic facsimile transmission, then at the time set forth in the
facsimile transmission confirmation report.
Any party listed below may change its address hereunder by notice to
the other party listed below. Until further notice, notice and other
communications hereunder shall be addressed to the parties listed below as
follows:
If to Contributors: Belcrest Realty Corporation and
Belair Real Estate Corporation
c/o Eaton Vance Management
The Eaton Vance Building
255 State Street
Boston, Massachusetts 02109
Attention: Mr. Alan Dynner
16
<PAGE> 18
Fax: (617) 338-8054
If to Operating
Partnership Sun Communities Operating Limited
or Company: Partnership
Suite 145
31700 Middlebelt Road
Farmington Hills, Michigan 48334
Attention: Mr. Jeffrey P. Jorissen
Fax: (248) 932-3072
16. PRESS RELEASES. Contributors, Operating Partnership and
Company each agrees that it will not issue any press release, advertisement or
other public communication with respect to this Agreement or transaction
contemplated therein without the prior consent of the other party hereto, except
to the extent such communication is required by applicable law or the rules of
the New York Stock Exchange; provided, however, that in such event, such party
shall deliver a copy of such proposed press release to the other party prior to
the publication thereof and shall grant the other party an opportunity to review
the same and shall make reasonable revisions to such proposed press release
requested by the other party.
(SIGNATURES ON NEXT PAGE)
17
<PAGE> 19
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the day first written above.
CONTRIBUTORS:
BELCREST REALTY CORPORATION
By: /s/ William R Cross
------------------------------
Name: William R Cross
Title: Vice President
BELAIR REAL ESTATE CORPORATION
By: /s/ William R Cross
------------------------------
Name: William R Cross
Title: Vice President
(SIGNATURES CONTINUE ON NEXT PAGE)
<PAGE> 20
OPERATING PARTNERSHIP:
SUN COMMUNITIES OPERATING LIMITED
PARTNERSHIP
By: Sun Communities, Inc., its
general partner
By: /s/ Jeffrey P. Jorissen
------------------------------
Name: Jeffrey P. Jorissen
Title: Chief Financial Officer
COMPANY:
SUN COMMUNITIES, INC.
By: /s/ Jeffrey P. Jorissen
------------------------------
Name: Jeffrey P. Jorissen
Title: Chief Financial Officer
<PAGE> 1
EXHIBIT 99.2
ONE HUNDRED THIRD AMENDMENT
TO THE
SECOND AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT
OF
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
THIS ONE HUNDRED THIRD AMENDMENT TO THE SECOND AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT OF SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
(this "AMENDMENT") is entered into as of September 29, 1999, 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"), BELCREST REALTY CORPORATION, a Delaware
corporation ("BELCREST") and BELAIR REAL ESTATE CORPORATION, a Delaware
corporation ("BELAIR"; each of Belcrest and Belair a "SERIES A PREFERRED
PARTNER" and collectively "SERIES A PREFERRED PARTNERS").
RECITALS
A. 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 two (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.
B. 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 (a) Belcrest
has contributed $35,000,000 to the Partnership in exchange for the issuance to
Belcrest of 1,400,000 Series A Preferred Units (as defined in the Agreement, as
amended hereby), and (b) Belair has contributed $15,000,000 to the Partnership
in exchange for the issuance of 600,000 Series A Preferred Units. The Series A
Preferred Units issued to the Series A Preferred Partners have been duly issued
and fully paid. The Series A Preferred Partners are hereby admitted to the
Partnership, effective as of September 29, 1999, each as a new Limited Partner,
and by execution of this Amendment the Series A Preferred Partners have agreed
to be bound by all of the terms and conditions of the
<PAGE> 2
Agreement, as amended hereby and hereby acknowledge 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 and Series A 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, and (ii) Series A Priority Return.
No distribution shall be made in respect of Common OP Units while any
accrued (i) Preferred Dividends, or (ii) Series A Priority Return,
remains unpaid unless all such unpaid amounts are paid simultaneously
with such distribution."
3. Section 3.6(b). The second sentence of Section 3.6(b) of the
Agreement is hereby amended by the insertion of the words "and preferred stock,
including, without limitation, Series A Preferred Stock" after the words "other
than its existing single class of common stock".
4. Section 3.6(c). Section 3.6(c) of the Agreement is hereby
amended by the insertion of the words "(excluding Series A Preferred Units)"
after the words "issue additional OP Units".
5. Section 3.8. Section 3.8(b) of the Agreement is hereby amended
by the insertion of the sentence:
"Nothing contained in this Section 3.8(b) shall affect, in any manner
adverse to the holders of the Series A Preferred Units, the rights of
the holders of the Series A Preferred Units in Section 16 of this
Agreement or in the Contribution Agreement with the Series A Preferred
Partners."
6. Section 3.9. Section 3.9 of the Agreement is hereby deleted in
its entirety and replaced with the following:
"3.9 WITHDRAWALS
2
<PAGE> 3
No Partner shall be entitled to withdraw any portion of its
capital account, except by way of distribution pursuant to Sections
4.3, 8.2 and 16 hereof."
7. Section 9.1. Section 9.1 of the Agreement is hereby amended by
(i) the insertion of the words "and SECTION 9.4" after the words "Subject to
Section 9.3", and (ii) by adding the following sentence at the end thereof:
"Notwithstanding anything to the contrary contained in this Section
9.1, no Limited Partner may transfer all or any part of its OP Units
if, in the opinion of counsel to the Partnership, such transfer would
likely cause the Partnership to be a PTP (as defined in Section 16.1
below)."
8. Section 9.4. The following new Section 9.4 is hereby added to
the Agreement:
"9.4 LIMITATIONS ON TRANSFER RESTRICTIONS
(a) Notwithstanding anything in this Agreement to the
contrary, an exchange pursuant to SECTION 16.9 (Exchange
Rights) below shall not be deemed a "transfer" within the
purview of SECTION 9 (Transferability of Interests).
(b) Notwithstanding anything in this Agreement to the
contrary, the General Partner shall be deemed to have
consented to the admission of any transferee of the Series A
Preferred Units as a substitute Limited Partner, provided (i)
the provisions of SECTION 9.3(A) (Restrictions on Transfer)
hereof are satisfied with respect to the transfer of Series A
Preferred Units, (ii) that the effect of such admission would
not cause the Partnership to be a PTP, (iii) such admission
would not result in more than twenty partners within the
meaning of Notice 88-75 (1988-2 C.B. 386) holding all
outstanding Series A Preferred Units for so long as the
Partnership satisfies the private placement safe harbor of
Notice 88-75 (1988- 2 C.B. 386), and (iv) such transferee
agrees to be bound by the terms of this Agreement.
9. Section 14.
(a) The definition of the term "TRANSFER" is hereby
amended to include the following text at the end of the first sentence
"; except that an exchange pursuant to SECTION 16.9 (Exchange Rights)
below shall not be deemed a "transfer" hereunder."
(b) 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 and Series A
Preferred Units."
3
<PAGE> 4
(c) The following new definitions are inserted in Section
14 (Definitions) so as to preserve alphabetical order:
"CHARTER" shall mean the Articles of Amendment and
Restatement of the General Partner, recorded on November 11,
1993, with the State of Maryland Department of Assessments and
Taxation (the "SMDAT"), as amended by (i) that certain
Articles of Amendment, recorded on June 20, 1997, with the
SMDAT, and (ii) the Series A Articles Supplementary, and as
may be further amended from time to time.
"DEPRECIATION" shall have the meaning set forth
therefor in Section 4.2 hereof.
"EXCESS SERIES A UNITS" shall have the meaning set
forth therefor in Section 16.9(a) hereof.
"ISSUANCE RATE" shall mean 9.125% per annum,
determined on the basis of a 360-day year of twelve 30-day
months.
"JUNIOR UNITS" shall have the meaning set forth
therefor in Section 16.3(c) hereof.
"PARITY PREFERRED UNITS" shall have the meaning set
forth therefor in Section 16.1 hereof.
"PTP" shall have the meaning set forth therefor in
Section 16.1 hereof.
"REGULATIONS" shall mean the Income Tax Regulations,
including Temporary Regulations, promulgated under the
Internal Revenue Code, as such regulations may be amended from
time to time (including corresponding provisions and
succeeding provisions).
"REVISED RATE" shall have the meaning set forth
therefor in Section 16.3(a) hereof.
"SERIES A ARTICLES SUPPLEMENTARY" shall mean those
Articles Supplementary of the General Partner establishing the
9.125% Series A Cumulative Redeemable Perpetual Preferred
Stock of the General Partner and intended to be filed with the
SMDAT on or about September 29, 1999.
"SERIES A EXCHANGE NOTICE" shall have the meaning set
forth therefor in Section 16.9(b) hereof.
4
<PAGE> 5
"SERIES A EXCHANGE PRICE" shall have the meaning set
forth therefor in Section 16.9(a) hereof.
"SERIES A PREFERRED PARTNERS" means Belcrest and
Belair, and their respective successors and permitted assigns.
"SERIES A PREFERRED UNIT DISTRIBUTION PAYMENT DATE"
shall have the meaning set forth therefor in Section 16.3(a)
hereof.
"SERIES A PREFERRED UNITS" shall have the meaning set
forth therefor in Section 16.2 hereof.
"SERIES A PRIORITY RETURN" shall have the meaning set
forth therefor in Section 16.1 hereof, as such meaning may be
modified by the provisions of Section 16.3(a)(ii).
"SERIES A REDEMPTION PRICE" shall have the meaning
set forth therefor in Section 16.6 hereof.
"SUBSIDIARY" shall have the meaning set forth
therefor in Section 16.1 hereof.
10. Section 16. The following new Section 16 is inserted in the
Agreement after Section 15 thereof:
"16. SERIES A PREFERRED UNITS.
SECTION 16.1 DEFINITIONS. For purposes of this Agreement, the
term "PARITY PREFERRED UNITS" shall be used to refer to 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 a parity with Series A Preferred Units with respect to
distributions and rights upon voluntary or involuntary liquidation,
winding-up or dissolution of the Partnership, and includes the
Preferred OP Units. The term "SERIES A PRIORITY RETURN" shall mean, an
amount equal to 9.125% per annum, determined on the basis of a 360 day
year of twelve 30 day months (and for any period shorter than a full
quarterly period for which distributions 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 ninety (90) days),
cumulative to the extent not distributed for any given distribution
period pursuant to Section 4.3 of the Agreement, of the stated value of
$25.00 per Series A Preferred Unit, commencing on the date of issuance
of such Series A Preferred Unit. The term "PTP" shall mean a "publicly
traded partnership" within the meaning of Section 7704 of the Internal
Revenue Code. The term "SUBSIDIARY" shall
5
<PAGE> 6
mean with respect to any person, any corporation, partnership, limited
liability company, joint venture or other entity of which a majority of
(i) voting power of the voting equity securities or (ii) the
outstanding equity interests, is owned, directly or indirectly, by such
person.
SECTION 16.2 DESIGNATION AND NUMBER. A series of OP Units in
the Partnership designated as the "9.125% Series A Cumulative
Redeemable Perpetual Preferred Units" (the "SERIES A PREFERRED UNITS")
is hereby established. The number of Series A Preferred Units shall be
2,000,000.
SECTION 16.3 DISTRIBUTIONS.
(a) Payment of Distributions.
(i) Subject to the rights of holders of
Parity Preferred Units as to the payment of
distributions, pursuant to Sections 4.3 and 8.2 of
the Agreement, holders of Series A 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 A Priority Return.
(ii) In the event that on or prior to
December 31, 1999, the Partnership's outstanding
senior unsecured debt shall have either an
unconditional, published (A) rating by Standard and
Poor's Rating Group ("STANDARD AND POOR'S") exceeding
"BBB" or (B) rating by Moody's Investors Service,
Inc. ("MOODY'S") exceeding "Baa3", then, beginning on
the date on which either of such foregoing conditions
is met, the Series A Priority Return shall be 8.875%
(the "REVISED RATE") of the original capital
contribution per Series A Preferred Unit, in which
case the designation of the Series A Preferred Units
will change accordingly to reflect such new
distribution rate; provided, that, if either (A) such
Standard & Poor's unconditional published rating
exceeding "BBB" or (B) such Moody's rating exceeding
"Baa3" shall not be in effect on December 31, 1999,
then the Revised Rate herein provided shall be void
ab initio and the Partnership shall pay on December
31, 1999, in addition to the distribution then due to
the holders of the Series A Preferred Units, the
difference between (1) the distribution that would
have accrued at the Issuance Rate during the current
and any prior quarterly distribution period and (2)
the distribution that actually accrued during such
distribution periods at the voided Revised Rate.
(iii) Promptly after December 31, 1999, the
parties hereto shall
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<PAGE> 7
execute, acknowledge and deliver or cause to be
executed acknowledged and delivered all instruments
and documents as may be reasonably necessary or
desirable to memorialize the distribution rate
revised in accordance with SECTION 16.3(A)(II) above
and in effect from and after December 31, 1999.
(iv) 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, commencing
on December 31, 1999 (with the first such payment to
include the amount accrued from the period commencing
on the date hereof through and including December 31,
1999) and, (ii) in the event of (A) an exchange of
Series A Preferred Units into Series A Preferred
Stock (as defined in the Series A Articles
Supplementary), or (B) a redemption of Series A
Preferred Units, on the exchange date or redemption
date, as applicable (each a "SERIES A PREFERRED UNIT
DISTRIBUTION PAYMENT DATE"). The amount of the
distribution payable for any period will be computed
on the basis of a 360-day year of twelve 30-day
months and for any period shorter than a full
quarterly period for which distributions 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 ninety (90) days.
If any date on which distributions are to be made on
the Series A 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 A
Preferred Units will be made to the holders of record
of the Series A 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 A Preferred Unit Distribution
Payment Date.
(b) Distributions Cumulative. Distributions on the
Series A 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
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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 A
Preferred Units will accumulate as of the Series A 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 A Preferred Unit
Distribution Payment Date to holders of record of the Series A
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 A 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 A Preferred Units (collectively, "JUNIOR
UNITS"), nor shall any cash or other property be set
aside for or applied to the purchase, redemption or
other acquisition for consideration of any Series A
Preferred Units, any Parity Preferred Units or any
Junior 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. The foregoing sentence
will not prohibit (a) distributions payable solely in
OP Units ranking junior to the Series A 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 Junior Units or Parity Preferred Units
into OP Units of the Partnership ranking junior to
the Series A Preferred Units as to distributions and
rights upon a voluntary or involuntary liquidation,
dissolution or winding-up of the Partnership, or (c)
the redemption of OP Units corresponding to any
Series A Preferred Stock (as hereinafter defined),
Parity Preferred Stock (as defined in the Series A
Articles Supplementary) with respect to distributions
or 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
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<PAGE> 9
sufficient for such full payment is not irrevocably
deposited in trust for immediate payment) upon the
Series A Preferred Units, all distributions
authorized and declared on the Series A Preferred
Units and all classes or series of outstanding Parity
Preferred Units shall be authorized and declared so
that the amount of distributions authorized and
declared per Series A Preferred Unit and such other
classes or series of Parity Preferred Units shall in
all cases bear to each other the same ratio that
accrued distributions per Series A Preferred Unit and
such other classes or series of Parity Preferred
Units (which shall not include any accumulation in
respect of unpaid distributions for prior
distribution periods if such class or series of
Parity Preferred Units do not have cumulative
distribution rights) bear to each other.
(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 16.3(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 A
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 16.4 ALLOCATIONS. Section 4.2 of the Agreement is
hereby deleted in its entirety and replaced with the following:
"4.2 PROFITS AND LOSSES
(a) Profits. Profits for any fiscal year (or portion
thereof) shall be allocated in the following order
and priority:
(i) first, to the General Partner, to the extent
that losses previously allocated to the General
Partner pursuant to Section 4.2(b)(iii) below
for all prior fiscal years or other applicable
periods exceed profits previously allocated to
the General Partner pursuant to this Section
4.2(a)(i) for all prior fiscal years or other
applicable periods,
(ii) second, to Partners holding Series A Preferred
Units, to the extent that losses previously
allocated to such Partners pursuant to Section
4.2(b)(ii) below for all prior fiscal years or
other applicable
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periods exceed profits previously allocated to
such Partners pursuant to this Section
4.2(a)(ii) for all prior fiscal years or other
applicable periods,
(iii) third, to Partners holding OP Units other than
Series A Preferred Units, to the extent that
losses previously allocated to such Partners
pursuant to Section 4.2(b)(i) below for all
prior fiscal years or other applicable periods
exceed profits previously allocated to such
Partners pursuant to this Section 4.2(a)(iii)
for all prior fiscal years or other applicable
periods,
(iv) fourth, to Partners holding Series A Preferred
Units, to each such Partner pro rata in
proportion to all Series A Preferred Units held
by such Partner in proportion to all Series A
Preferred Units outstanding, until each such
Partner has been allocated profits equal to the
excess of (x) the cumulative amount of Series A
Priority Return all such Partners are entitled
to receive as of the last day of the current
fiscal year or other applicable period or to
the date of redemption, to the extent such
Series A Preferred Units are redeemed during
such period, over (y) the cumulative profits
allocated to all such Partners, pursuant to
this Section 4.2(a)(iv) for all prior fiscal
years or other applicable periods, and
(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 pursuant to this Section
4.2(b)(v) for any calendar year shall not
exceed the amount of Preferred Dividends
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.
(b) Losses. Losses shall be allocated in the following
order and priority:
(i) first, to the Partners (including the General
Partner) holding 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 Partner as of the
last day of the period for which such
allocation is being made without causing any
Partner to have an adjusted capital account
deficit with respect to such OP Units,
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(ii) second, to the Partners holding any Series A
Preferred Units in accordance with the
rights of the Series A Preferred Units,
without causing any Partner to have an
adjusted capital account deficit with
respect to such Series A Preferred Units,
and
(iii) third, to the General Partner.
To the extent permitted under Section 704 of the
Internal Revenue Code, solely for purposes of allocating
profits or losses in any taxable year (or a portion thereof)
to Partners holding Series A Preferred Units pursuant to
Section 4.2(a) and (b) hereof, items of profit or loss, as the
case may be, shall not include depreciation, as adjusted under
Regulations Section 1.704-1(b)(2) ("DEPRECIATION"), with
respect to properties that are "ceiling limited" in respect of
holders of Series A Preferred Units. For purposes of the
preceding sentence, Partnership property shall be considered
"ceiling limited" in respect of a holder of Series A Preferred
Units if Depreciation attributable to such Partnership
property which would otherwise be allocable to such Partner,
without regard to this paragraph, exceeds Depreciation
determined for federal income tax purposes attributable to
such Partnership property which would otherwise be allocable
to such holder by more than 5%."
SECTION 16.5 LIQUIDATION PROCEEDS.
(a) Upon any voluntary or involuntary
liquidation, dissolution or winding-up of the affairs of the
Partnership, distributions on the Series A Preferred Units
shall be made in accordance with Section 8.2 of the Agreement,
except that Section 8.2 is hereby amended so that all
references in Section 8.2 to (i) "Preferred OP Units" are
revised to be "Preferred OP Units and Series A Preferred
Units", and (ii) "Preferred Dividends" are revised to be
"Preferred Dividends or Series A Priority Return, as the case
may be."
(b) Notice. Written notice of any such voluntary
or involuntary liquidation, dissolution or winding-up of the
Partnership, stating the payment date or dates when, and the
place or places where, the amounts distributable in such
circumstances shall be payable, shall be given by (i) fax and
(ii) by first class mail, postage pre-paid, not less than
thirty (30) and not more than sixty (60) days prior to the
payment date stated therein, to each record holder of the
Series A Preferred Units at the respective addresses of such
holders as the same shall appear on the transfer records of
the Partnership.
(c) No Further Rights. After payment of the full
amount of the liquidating distributions to which they are
entitled, the holders of Series A
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<PAGE> 12
Preferred Units will have no right or claim to any of the
remaining assets of the Partnership.
(d) Consolidation, Merger or Certain Other
Transactions. The voluntary sale, conveyance, lease, exchange
or transfer (for cash, shares 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 16.6 OPTIONAL REDEMPTION.
(a) Right of Optional Redemption. The Series A
Preferred Units may not be redeemed prior to the fifth (5th)
anniversary of the issuance date. On or after such date, the
Partnership shall have the right to redeem the Series A
Preferred Units, in whole or in part, at any time or from time
to time, upon not less than thirty (30) nor more than sixty
(60) days written notice, at a redemption price, payable in
cash, equal to the capital account balance of the holders of
Series A Preferred Units (the "SERIES A REDEMPTION PRICE");
provided, however, that no redemption pursuant to this SECTION
16.6 will be permitted if the Series A Redemption Price does
not equal or exceed $25.00 per Series A Preferred Unit plus
the cumulative Series A Priority Return, whether or not
declared, to the redemption date to the extent not previously
distributed. If fewer than all of the outstanding Series A
Preferred Units are to be redeemed, the Series A Preferred
Units to be redeemed shall be selected pro rata (as nearly as
practicable without creating fractional units).
(b) Limitation on Redemption.
(i) The Series A Redemption Price of the
Series A Preferred Units (other than the portion
thereof consisting of accumulated but unpaid
distributions) will be payable solely out of the sale
proceeds of capital stock of the General Partner,
which will be contributed by the General Partner to
the Partnership as additional capital contribution,
or out of the sale of limited partner interests in
the Partnership and from no other source. For
purposes of the preceding sentence, "capital stock"
means any equity securities (including Common Stock
and Preferred Stock (as such terms are defined in the
Charter)), shares, participation or other ownership
interests (however designated) and any rights (other
than debt securities convertible into or exchangeable
for equity securities) or options to
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<PAGE> 13
purchase any of the foregoing.
(ii) The Partnership may not redeem fewer
than all of the outstanding Series A Preferred Units
unless all accumulated and unpaid distributions have
been paid on all Series A Preferred Units for all
quarterly distribution periods terminating on or
prior to the date of redemption.
(c) Procedures for Redemption.
(i) Notice of redemption will be (A)
faxed, and (B) mailed by the Partnership, by
certified mail, postage prepaid, not less than thirty
(30) nor more than sixty (60) days prior to the
redemption date, addressed to the respective holders
of record of the Series A Preferred Units at their
respective addresses as they appear on the records of
the Partnership. No failure to give or defect in such
notice shall affect the validity of the proceedings
for the redemption of any Series A Preferred Units
except as to the holder to whom such notice was
defective or not given. In addition to any
information required by law, each such notice shall
state: (1) the redemption date, (2) the Series A
Redemption Price, (3) the aggregate number of Series
A Preferred Units to be redeemed and if fewer than
all of the outstanding Series A Preferred Units are
to be redeemed, the number of Series A 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 A Preferred Units the total number
of Series A Preferred Units held by such holder
represents) of the aggregate number of Series A
Preferred Units to be redeemed, (4) the place or
places where the Series A Preferred Units are to be
surrendered for payment of the Series A Redemption
Price, (5) that distributions on the Series A
Preferred Units to be redeemed will cease to
accumulate on such redemption date and (6) that
payment of the Series A Redemption Price will be made
upon presentation and surrender of such Series A
Preferred Units.
(ii) If the Partnership gives a notice of
redemption in respect of Series A Preferred Units
(which notice will be irrevocable) then, 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 A Preferred
Units being redeemed funds sufficient to pay the
applicable Series A Redemption Price and will give
irrevocable instructions to such transfer
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<PAGE> 14
agent and authority to pay such Series A Redemption
Price to the holders of the Series A Preferred Units
upon surrender of the Series A Preferred Units by
such holders at the place designated in the notice of
redemption. If the Series A Preferred Units are
evidenced by a certificate and if fewer than all
Series A Preferred Units evidenced by any certificate
are being redeemed, a new certificate shall be issued
upon surrender of the certificate evidencing all
Series A Preferred Units, evidencing the unredeemed
Series A Preferred Units without cost to the holder
thereof. On and after the date of redemption,
distributions will cease to accumulate on the Series
A Preferred Units or portions thereof called for
redemption, unless the Partnership defaults in the
payment thereof. If any date fixed for redemption of
Series A Preferred Units is not a Business Day, then
payment of the Series A 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 A Redemption
Price is improperly withheld or refused and not paid
by the Partnership, distributions on such Series A
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 applicable Series A Redemption Price.
SECTION 16.7 VOTING RIGHTS.
(a) General. Holders of the Series A Preferred
Units will not have any voting rights or right to consent to
any matter requiring the consent or approval of the Limited
Partners, except as set forth in SECTION 11 (AMENDMENTS) of
the Agreement and except as set forth below.
(b) Certain Voting Rights. So long as any Series
A Preferred Units remain outstanding, the Partnership shall
not, without the affirmative vote of the holders of at least
two-thirds of the Series A Preferred Units outstanding at the
time (i) (A) authorize or create, or increase the authorized
or issued amount of, any class or series of OP Units ranking
senior to the Series A Preferred Units with respect to payment
of distributions or rights upon liquidation, dissolution or
winding-up, or (B) reclassify any OP Units of the Partnership
into any such senior OP Units, or (C) create, authorize or
issue any obligations or security convertible
into or evidencing the right to purchase any such senior OP
Units, (ii) (A) authorize or create, or increase the
authorized or issued amount of any Parity
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<PAGE> 15
Preferred Units (or any OP Units which purport to be on parity
with the Series A Preferred Units as to either (but not both)
distributions or rights upon dissolution, liquidation or
winding-up), or (B) reclassify any OP Unit into any such
Parity Preferred Units (or any OP Units which purport to be on
parity with the Series A Preferred Units as to either (but not
both) distributions or rights upon dissolution, liquidation or
winding-up), or (C) create, authorize or issue any obligation
or security convertible into or evidencing the right to
purchase any such Parity Preferred Units (or any OP Units
which purport to be on parity with the Series A Preferred
Units as to either (but not both) distributions or rights upon
dissolution, liquidation or winding-up), but only to the
extent such Parity Preferred Units (or any OP Units which
purport to be on parity with the Series A Preferred Units as
to either (but not both) distributions or rights upon
dissolution, liquidation or winding-up) are issued to an
affiliate (as defined in Section 14) of the Partnership,
unless (y) such affiliate is the General Partner and such
Parity Preferred Units (or any OP Units which purport to be on
parity with the Series A Preferred Units as to either (but not
both) distributions or rights upon dissolution, liquidation or
winding-up) correspond to preferred shares issued to a
nonaffiliate of the Partnership or (z) such Parity Preferred
Units (or any OP Units which purport to be on parity with the
Series A Preferred Units as to either (but not both)
distributions or rights upon dissolution, liquidation or
winding-up) are issued upon terms determined by the General
Partner's Board of Directors (such determination to include
the affirmative approval of a majority of all disinterested
directors) to be no more favorable to the holders thereof than
those it would offer in an arm's length transaction to an
unrelated party; or (iii) either (A) consolidate, merge into
or with, or convey, transfer or lease its assets substantially
as an entirety to, any corporation or other entity or (B)
amend, alter or repeal the provisions of the Agreement,
whether by merger, consolidation or otherwise, in each case,
that would materially and adversely affect the powers, special
rights, preferences, privileges or voting power of the Series
A Preferred Units or the holders thereof; provided, however,
that with respect to the occurrence of a merger, consolidation
or a sale or lease of all of the Partnership's assets as an
entirety, so long as (1) the Partnership is the surviving
entity and the Series A Preferred Units remain outstanding
with the terms thereof unchanged, or (2) the resulting,
surviving or transferee entity is a partnership, limited
liability company or other pass-through entity, or after a
date not sooner than the date which is three (3) years after
the date hereof, a corporation (or other nonpass-through
entity), in each case, organized under the laws of any state
and substitutes the Series A Preferred Units for other
interests in such entity having substantially the same terms
and rights as the Series A Preferred Units, including with
respect to distributions, voting rights and rights upon
liquidation, dissolution or winding-up, then the occurrence of
any such event shall not be deemed to materially and adversely
affect such rights, privileges or voting powers of the holders
of the
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Series A Preferred Units.
SECTION 16.8 TRANSFER RESTRICTIONS. The Series A
Preferred Units shall be subject to the provisions of SECTION 9 of the
Agreement.
SECTION 16.9 EXCHANGE RIGHTS.
(a) Right to Exchange.
(i) Series A Preferred Units will be
exchangeable in whole, but not in part unless
expressly otherwise provided herein, at anytime on or
after the tenth (10th) anniversary of the date of
issuance, at the option of the holders of at least
51% of all outstanding Series A Preferred Units, for
authorized but previously unissued shares of 9.125%
Series A Cumulative Redeemable Preferred Stock of the
General Partner (the "SERIES A PREFERRED STOCK") at
an exchange rate of one share of Series A Preferred
Stock for one Series A Preferred Unit, subject to
adjustment as described below (the "SERIES A EXCHANGE
PRICE"), provided that the Series A Preferred Units
will become exchangeable at any time, in whole, but
not in part unless expressly otherwise provided
herein, at the option of the holders of at least 51%
of all outstanding Series A Preferred Units (x) if at
any time full distributions shall not have been made
on the Series A Preferred Unit Distribution Payment
Date on any Series A Preferred Unit with respect to
six (6) prior quarterly distribution periods, whether
or not consecutive, provided, however, that a
distribution in respect of Series A Preferred Units
shall be considered timely made on the Series A
Preferred Unit Distribution Payment Date if made
within two (2) Business Days after the applicable
Series A Preferred Unit Distribution Payment Date if
at the time of such late payment there shall not be
any prior quarterly distribution periods in respect
of which full distributions were made more than two
(2) Business Days after the applicable Series A
Preferred Unit Distribution Payment Date, or (y) upon
receipt by a holder or holders of Series A Preferred
Units of (1) notice from the General Partner that the
General Partner or a Subsidiary of the General
Partner has taken the position that the Partnership
is, or upon the occurrence of a defined event in the
immediate future will be, a PTP and (2) an opinion
rendered by an outside nationally recognized
independent counsel familiar with such matters
addressed to a holder or holders of Series A
Preferred Units, that the Partnership is or likely
is, or upon the occurrence of a defined event in the
immediate future will be or likely will be, a PTP.
In addition, the Series A Preferred Units
may be exchanged for
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<PAGE> 17
Series A Preferred Stock, in whole, but not in part
unless expressly otherwise provided herein, at the
option of holders of at least 51% of all outstanding
Series A Preferred Units prior to the tenth (10th)
anniversary of the issuance date and after the third
(3rd) anniversary thereof if such holders shall
deliver to the General Partner either (i) a private
letter ruling addressed to such holder of Series A
Preferred Units or (ii) an opinion of independent
counsel reasonably acceptable to the General Partner
based on the enactment of temporary or final Treasury
Regulations or the publication of a Revenue Ruling,
in either case to the effect that an exchange of the
Series A Preferred Units at such earlier time would
not cause the Series A Preferred Units to be
considered "stock and securities" within the meaning
of Section 351(e) of the Internal Revenue Code for
purposes of determining whether the holder of such
Series A Preferred Units is an "investment company"
under section 721(b) of the Internal Revenue Code if
an exchange is permitted at such earlier date.
Additionally, the Series A Preferred Units
may be exchanged for Series A Preferred Stock, in
whole, but not in part unless expressly otherwise
provided herein, at the option of holders of at least
51% of all outstanding Series A Preferred Units, at
any time after the third (3rd) anniversary of the
date hereof, in the event the Partnership merges,
consolidates, or sells or leases all of its assets as
an entirety, where the resulting, surviving or
transferee entity is a corporation or otherwise not a
pass-through entity.
Furthermore, the Series A Preferred Units
may be exchanged in whole but not in part by any
holder thereof which is a real estate investment
trust within the meaning of Sections 856 through 859
of the Internal Revenue Code for Series A Preferred
Stock (but only if the exchange in whole may be
accomplished consistently with the ownership
limitations set forth under Article VII of the
Charter of the General Partner (taking into account
exceptions thereto)) if at any time, (i) the
Partnership reasonably determines that the assets and
income of the Partnership for a taxable year after
1999 would not satisfy the income and assets tests of
Section 856 of the Internal Revenue Code for such
taxable year if the Partnership were a real estate
investment trust within the meaning of the Internal
Revenue Code or (ii) any such holder of Series A
Preferred Units shall deliver to the Partnership and
the General Partner an opinion of independent counsel
reasonably acceptable to the General Partner to the
effect that, based on the assets and income of the
Partnership for a taxable year after 1999, the
Partnership would not satisfy the income and assets
tests of Section 856 of the Internal Revenue Code for
such taxable year if
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the Partnership were a real estate investment trust
within the meaning of the Internal Revenue Code and
that such failure would create a meaningful risk that
a holder of the Series A Preferred Units would fail
to maintain qualification as a real estate investment
trust.
(ii) Notwithstanding anything to the
contrary set forth in SECTION 16.9(A)(I) hereof, if a
Series A Exchange Notice (as defined herein) has been
delivered to the General Partner, then the General
Partner may, at its option, elect to redeem or cause
the Partnership to redeem all or a portion of the
outstanding Series A Preferred Units for cash in an
amount equal to the original capital contribution per
Series A Preferred Unit plus all accrued and unpaid
distributions thereon to the date of redemption. The
General Partner may exercise its option to redeem the
Series A Preferred Units for cash pursuant to this
SECTION 16.9(A)(II) hereof by giving each holder of
record of Series A Preferred Units notice of its
election to redeem for cash, within five (5) Business
Days after receipt of the Series A Exchange Notice,
by (m) fax, and (n) registered mail, postage paid, at
the address of each holder as it may appear on the
records of the Partnership stating (A) the redemption
date, which shall be no later than sixty (60) days
following the receipt of the Series A Exchange
Notice, (B) the redemption price, (C) the place or
places where the Series A Preferred Units are to be
surrendered for payment of the redemption price, (D)
that distributions on the Series A Preferred Units
will cease to accrue on such redemption date; (E)
that payment of the redemption price will be made
upon presentation and surrender of the Series A
Preferred Units and (F) the aggregate number of
Series A Preferred Units to be redeemed, and if fewer
than all of the outstanding Series A Preferred Units
are to be redeemed, the number of Series A 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 A Preferred Units the total number
of Series A Preferred Units held by such holder
represents) of the aggregate number of Series A
Preferred Units being redeemed.
(iii) In the event an exchange of all or a
portion of Series A Preferred Units pursuant to
SECTION 16.9(A)(I) hereof would violate the
provisions on ownership limitation of the General
Partner set forth in Article VII of the Charter with
respect to the Series A Preferred Stock, the
General Partner shall give written notice thereof to
each holder of record of Series A Preferred Units,
within five (5) Business Days following receipt of
the Series A Exchange Notice, by (m) fax, and (n)
registered mail, postage prepaid, at the address of
each such holder set forth in the
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records of the Partnership. In such event, each
holder of Series A Preferred Units shall be entitled
to exchange, pursuant to the provision of SECTION
16.9(B) a number of Series A Preferred Units which
would comply with the provisions on the ownership
limitation of the General Partner set forth in such
Article VII of the Charter and any Series A Preferred
Units not so exchanged (the "EXCESS SERIES A UNITS")
shall be redeemed by the Partnership for cash in an
amount equal to the original capital contribution per
Excess Series A Unit, plus any accrued and unpaid
distributions thereon, whether or not declared, to
the date of redemption. The written notice of the
General Partner shall state (A) the number of Excess
Series A Units held by such holder, (B) the
redemption price of the Excess Series A Units, (C)
the date on which such Excess Series A Units shall be
redeemed, which date shall be no later than sixty
(60) days following the receipt of the Series A
Exchange Notice, (D) the place or places where such
Excess Series A Units are to be surrendered for
payment of the Series A Redemption Price, (E) that
distributions on the Excess Series A Units will cease
to accrue on such redemption date, and (F) that
payment of the redemption price will be made upon
presentation and surrender of such Excess Series A
Units. In the event an exchange would result in
Excess Series A Units, as a condition to such
exchange, each holder of such units agrees to provide
representations and covenants reasonably requested by
the General Partner relating to (1) the widely held
nature of the interests in such holder, sufficient to
assure the General Partner that the holder's
ownership of stock of the General Partner will not
cause any individual to own the stock of the General
Partner in excess of the Ownership Limit (as defined
in the Charter); and (2) to the extent such holder
can so represent and covenant without obtaining
information from its owners, the holder's ownership
of tenants of the Partnership and its affiliates (as
defined in Section 14).
(iv) The redemption of Series A Preferred
Units described in SECTION 16.9(A)(II) and (III)
shall be subject to the provisions of SECTION
16.6(B)(I) and SECTION 16.6(C)(II); provided,
however, that the term "Series A Redemption Price" in
such Section shall be read to mean the original
capital contribution per Series A Preferred Unit
being redeemed plus all accrued and unpaid
distributions to the redemption date.
(b) Procedure for Exchange.
(i) Any exchange shall be exercised
pursuant to a notice of exchange (the "SERIES A
EXCHANGE NOTICE") delivered to the General Partner by
the holder who is exercising such exchange right, by
(A) fax and (B) by certified mail postage prepaid.
The exchange of Series A
19
<PAGE> 20
Preferred Units, or a specified portion thereof, may
be effected after the fifth (5th) Business Day
following receipt by the General Partner of the
Series A Exchange Notice by delivering certificates,
if any, representing such Series A Preferred Units to
be exchanged together with, if applicable, written
notice of exchange and a proper assignment of such
Series A Preferred Units to the office of the General
Partner maintained for such purpose. Currently, such
office is:
Sun Communities, Inc.
Suite 145
31700 Middlebelt Road
Farmington Hills, Michigan 48334.
Each exchange will be deemed to have been effected
immediately prior to the close of business on the
date on which such Series A Preferred Units to be
exchanged (together with all required documentation)
shall have been surrendered and notice shall have
been received by the General Partner as aforesaid and
the Series A Exchange Price shall have been
delivered. Any Series A Preferred Stock issued
pursuant to this SECTION 16.9 shall be delivered as
shares which are duly authorized, validly issued,
fully paid and nonassessable, free of pledge, lien,
encumbrance or restriction other than those provided
in the Charter, the Bylaws of the General Partner,
the Securities Act of 1933, as amended and relevant
state securities or blue sky laws.
(ii) In the event of an exchange of Series
A Preferred Units for shares of Series A Preferred
Stock, an amount equal to the accrued and unpaid
distributions, whether or not declared, to the date
of exchange on any Series A Preferred Units tendered
for exchange shall (A) accrue on the shares of the
Series A Preferred Stock into which such Series A
Preferred Units are exchanged, and (B) continue to
accrue on such Series A Preferred Units, which shall
remain outstanding following such exchange, with the
General Partner as the holder of such Series A
Preferred Units. Notwithstanding anything to the
contrary set forth herein, in no event shall a holder
of a Series A Preferred Unit that was validly
exchanged into Series A Preferred Stock pursuant to
this section (other than the General Partner now
holding such Series A Preferred Unit), receive a cash
distribution out of available cash of the
Partnership, if such holder, after exchange, is
entitled to receive a distribution with respect to
the share of Series A Preferred Stock for which such
Series A Preferred Unit was exchanged or redeemed.
20
<PAGE> 21
(iii) Fractional shares of Series A
Preferred Stock are not to be issued upon exchange
but, in lieu thereof, the General Partner will pay a
cash adjustment based upon the fair market value of
the Series A Preferred Stock on the day prior to the
exchange date as determined in good faith by the
Board of Directors of the General Partner.
(c) Adjustment of Series A Exchange Price.
(i) The Exchange Price is subject to
adjustment upon subdivisions, stock splits, stock
dividends, combinations and reclassification of the
Series A Preferred Stock.
(ii) 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 Series
A Preferred 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 A Preferred Unit will
thereafter be 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
Series A Preferred Stock or fraction thereof into
which one Series A Preferred Unit was exchangeable
immediately prior to such transaction. The General
Partner may not become a party to any such
transaction unless the terms thereof are consistent
with the foregoing.
SECTION 16.10 NO CONVERSION RIGHTS. The holders of the Series
A Preferred Units shall not have any rights to convert such units into
shares of any other class or series of stock or into any other
securities of, or interest in, the Partnership or the General Partner,
except for Series A Preferred Stock.
SECTION 16.11 NO SINKING FUND. No sinking fund shall be
established for the retirement or redemption of Series A Preferred
Units.
11. Governing Law. This Amendment shall be interpreted and
enforced according to the laws of the State of Michigan.
12. 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.
21
<PAGE> 22
13. 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.
14. 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.
(SIGNATURES APPEAR ON NEXT PAGE)
22
<PAGE> 23
IN WITNESS WHEREOF, the undersigned has executed this Amendment as of
the day and year first above written.
GENERAL PARTNER
SUN COMMUNITIES, INC.
By /s/ Jeffrey P. Jorissen
---------------------------------------
Name: Jeffrey P. Jorissen
Title: Senior Vice President
(SIGNATURES CONTINUE ON NEXT PAGE)
23
<PAGE> 24
NEW LIMITED PARTNERS
BELCREST REALTY CORPORATION
By /s/ William R. Cross
---------------------------------------
Name: William R. Cross
Title: Vice President
BELAIR REAL ESTATE CORPORATION
By /s/ William R. Cross
---------------------------------------
Name: William R. Cross
Title: Vice President
24
<PAGE> 25
EXHIBIT A
SCHEDULE OF PARTNERS, OP UNITS, PREFERRED OP UNITS
AND
SERIES A PREFERRED UNITS
<TABLE>
<CAPTION>
SERIES A
PARTNERS COMMON PREFERRED PREFERRED
- -------- OP UNITS OP UNITS UNITS
-------- -------- -----
<S> <C> <C> <C>
General Partner
Sun Communities, Inc., a Maryland 17,433,258
Corporation
31700 Middlebelt Road
Suite 145
Farmington Hills, Michigan 48334
Limited Partners
Gary A. Shiffman 306,617
31700 Middlebelt Road
Suite 145
Farmington Hills, Michigan 48334
Robert B. Bayer 133,115
31700 Middlebelt Road
Suite 145
Farmington Hills, Michigan 48334
Water Oak, Ltd. 8,888
Winderweedle, Haines Ward &
Woodman, P.A.
250 Park Avenue, South, 5th Floor
Winter Park, Florida 32789-4388
Albert P. Gollob 25,000
380 North Woodward Avenue
Suite 206
Birmingham, Michigan 48009
John F. O'Shea, as Trustee of the 28,000
John F. O'Shea Declaration of Trust
created under instrument dated
January 2, 1996
380 North Woodward Avenue
Suite 206
</TABLE>
25
<PAGE> 26
<TABLE>
<CAPTION>
SERIES A
PARTNERS COMMON PREFERRED PREFERRED
- -------- OP UNITS OP UNITS UNITS
-------- -------- -----
<S> <C> <C> <C>
Birmingham, Michigan 48009
Carmen O'Shea 22,000
380 North Woodward Avenue
Suite 206
Birmingham, Michigan 48009
Henry S. Gornbein 6,126
Shapack, McCullough & Kanter,
P.C.
4190 Telegraph Road
Suite 3000
Bloomfield Hills, Michigan 48302-
2082
Robert J. Peters 7,747
40126 Pallazzo Street
Clinton Township, Michigan 48038
Nancy Kolender 6,126
3130 West Long Lake Road
Orchard Lake, Michigan 48323
Terran Shiffman Leemis 25,000
876 Covington
Bloomfield Hills, Michigan 48301
Gail Shiffman Hennes 17,500
14086 Ludlow
Oak Park, Michigan 48237
Audrey Shiffman 17,500
(formerly Audrey Shiffman
Langmaid)
2820 69th S.E.
Mercier Island, Washington 98040
Gary A. Shiffman as custodian for 1,000
Matthew Shiffman under UGMA
31700 Middlebelt Road, Suite 145
Farmington Hills, Michigan 48334
Gary A. Shiffman as custodian for 1,000
Adam Shiffman under UGMA
31700 Middlebelt Road, Suite 145
Farmington Hills, Michigan 48334
Gary A. Shiffman as custodian for 1,000
</TABLE>
26
<PAGE> 27
<TABLE>
<CAPTION>
SERIES A
PARTNERS COMMON PREFERRED PREFERRED
- -------- OP UNITS OP UNITS UNITS
-------- -------- -----
<S> <C> <C> <C>
Alex Shiffman under UGMA
31700 Middlebelt Road, Suite 145
Farmington Hills, Michigan 48334
Audrey Shiffman (formerly Audrey 1,000
Shiffman Langmaid) as custodian for
Jessica Langmaid under UGMA
2829 69th S.E.
Mercier Island, Washington 98040
Audrey Shiffman (formerly Audrey 1,000
Shiffman Langmaid) as custodian for
Elizabeth Langmaid under UGMA
2829 69th S.E.
Mercier Island, Washington 98040
Gail Shiffman Hennes as custodian 1,000
for Asher Hennes under UGMA
14086 Ludlow
Oak Park, Michigan 48237
Gail Shiffman Hennes as custodian 1,000
for Rina Hennes under UGMA
14086 Ludlow
Oak Park, Michigan 48237
Terran Shiffman Leemis as custodian 875
for Jennifer Leemis under UGMA
876 Covington
Bloomfield Hills, Michigan 48301
Terran Shiffman Leemis as custodian 875
for Rachel Leemis under UGMA
876 Covington
Bloomfield Hills, Michigan 48301
Sherman Simon 25,005
9999 Collins Avenue
Bal Harbour, Florida 33154
Gerard Berger 20,607
10425 SW 129th Terrace
Miami, Florida 33176
Gerard Berger, Nominee 4,942
10425 SW 129th Terrace
Miami, Florida 33176
</TABLE>
27
<PAGE> 28
<TABLE>
<CAPTION>
SERIES A
PARTNERS COMMON PREFERRED PREFERRED
- -------- OP UNITS OP UNITS UNITS
-------- -------- -----
<S> <C> <C> <C>
Robert Sentz 15,811
1287 Pigeon Roost Road
Pulaski, TN 38478
Royal Country, Ltd., a Florida ltd 20,420
partnership
c/o Gerard Berger
501 Brickell Key Drive, Suite 103
Miami, Florida 33131
Paul Simon 17,955
3041 North 34th Street
Hollywood, Florida 33021
SI Enterprises, Inc., 56,893
a Florida corporation
501 Brickell Key Drive, Suite 103
Miami, Florida 33131
J.B.E. Inc., a Florida corporation 41,071
501 Brickell Key Drive, Suite 103
Miami, Florida 33131
S.R.K. Financial, Inc., 27,676
a Florida corporation
501 Brickell Key Drive, Suite 103
Miami, Florida 33131
Mr. Herbert Rosen 25,000
4001 North Ocean Boulevard #804
Boca Raton, Florida 33431
Louis Benson, Trustee 26,931
5701 Bayberry Lane
Tamarac, Florida 33319
Philip Benson 4,489
8 Bruns Road
West Allenhurst, NJ 07711-1400
Irwin Cantor 2,846
#2 Bay Club Drive
Apt. 21W
Bayside, NY 11360
Robin Fuchs 4,489
P.O. Box 2520
Nantucket, MA 02584
</TABLE>
28
<PAGE> 29
<TABLE>
<CAPTION>
SERIES A
PARTNERS COMMON PREFERRED PREFERRED
- -------- OP UNITS OP UNITS UNITS
-------- -------- -----
<S> <C> <C> <C>
Jacob Glouberman 3,646
300 Winston Drive
Cliffside Park, NJ 07010
Robert Helfand 7,293
APD0202
San Miguel Day Allende
GTO, 37700 Mexico
Eugene W. Kalkin 14,308
18 Pfizer Road
Bernardsville, NJ 07924
Morton Kaplan 4,994
18 Yale Drive
Manhassett, NY 11030
Saul Klaw 3,646
275 Madison Avenue
New York, NY 10016
Stanley C. Lesser 10,662
Lesser & Harrison
2 West 45th Street
New York, NY 10036
Ysrael Seinuk 3,646
82 Tennis Place
Forest Hills, NY 11375-5163
Julius J. Shepard Revocable Trust 61,080
c/o Dupont Plaza Hotel
300 Biscayne Boulevard, Suite 307
Miami, Florida 33131-2207
Miriam Simon, as Custodian for 2,917
Brian Simon
3041 North 34th Street
Hollywood, Florida 33021
Miriam Simon, as Custodian for 2,917
Richard Simon
3041 North 34th Street
Hollywood, Florida 33021
Jeffrey Simon, as Custodian for Peter 2,917
Simon
8915 SW 163rd Terrace
</TABLE>
29
<PAGE> 30
<TABLE>
<CAPTION>
SERIES A
PARTNERS COMMON PREFERRED PREFERRED
- -------- OP UNITS OP UNITS UNITS
-------- -------- -----
<S> <C> <C> <C>
Miami, Florida 33157
Victor Matles 10,110
P.O. Box 8493
Coral Springs, Florida 33075-8493
Leonard Cooper 1,348
3 Lisa Drive
Dix Hills, NY 11746
Ofelia Glouberman 1,348
300 Winston Drive
Cliffside Park, NJ 07010
Adam Kalkin 1,685
18 Pfizer Road
Bernardsville, NJ 07924
Nancy Kalkin 1,685
18 Pfizer Road
Bernardsville, NJ 07924
Lawrence Kline 898
Kline, Moore & Klein
2665 South Bayshore Drive
Suite 903
Coconut Grove, Florida 33133
Robert Kline 898
Kline, Moore & Klein
2665 South Bayshore Drive
Suite 903
Coconut Grove, Florida 33133
James Lyons 4,813
120 Lincoln Road
Winter Haven, Florida 33884
Fanny Seinuk 1,348
82 Tennis Place
Forest Hills, NY 11375-5163
HTR Associates, Inc. 6,738
a Florida corporation
501 Brickell Key Drive
Suite 103
Miami, Florida 33131
Steven M. Tracy, as Trustee of the 210,458
</TABLE>
30
<PAGE> 31
<TABLE>
<CAPTION>
SERIES A
PARTNERS COMMON PREFERRED PREFERRED
- -------- OP UNITS OP UNITS UNITS
-------- -------- -----
<S> <C> <C> <C>
Steven M. Tracy Declaration of Trust
dated June 25, 1984
1765 Cypress Point Court
Ann Arbor, Michigan 48108
Steven M. Tracy, as Successor 420,917
Trustee of the Phil F. Jenkins
Revocable Living Trust created
under agreement dated January 6,
1967, as amended
2041 Greenview Drive
Ann Arbor, Michigan 48103
Howard T. Rice, as Trustee of the 4,500
Howard T. Rice Revocable Living
Trust created under agreement dated
March 10, 1967, as amended
4605 S. Ocean Blvd.
Suite 7D
Highland Beach, FL 33487
Ronald A. House and 5,056 41,456
Joanne K. House,
Joint Tenants
1651 Chateau Dr, S.W.
Wyoming, Michigan 49509-4914
Robert L. Kramer and 5,056 32,497
Ruth A. Kramer,
Trustees of the Robert L. Kramer
Trust U/T/A dated August 7, 1996
421 Buena Vista Drive
Spring Lake, Michigan 49456-1734
Charles R. Negley and Carroll S. 5,056 39,110
Negley,
Joint Tenants
9930 Caloosa Yacht & Racquet
Drive
Fort Myers, Florida 33919-3169
The J. Lanting Family Limited 21,953
Partnership
5999 Hillsborough Court
</TABLE>
31
<PAGE> 32
<TABLE>
<CAPTION>
SERIES A
PARTNERS COMMON PREFERRED PREFERRED
- -------- OP UNITS OP UNITS UNITS
-------- -------- -----
<S> <C> <C> <C>
Grandville, Michigan 49418
Todd Lanting 10,866
6185 S. Routt
Littleton, CO 80127
Julie Lanting 10,866
856 Clarewood Ct.
Holland, Michigan 49423
Arlyn Lanting 221
1575 South Shore Drive
Holland, Michigan 49423
Vicki Essink 10,866
1069 Alden Court
Holland, Michigan 49423
Jaclyn Geerlings 10,866
557 Jasmine Drive
Holland, Michigan 49423
Lee DeVisser and Linda L. 3,925
DeVisser, Co-Trustees of the Lee
DeVisser Revocable Trust Created
U/T/A dated 1/4/93
2480 53rd Street N.W.
Boca Raton, FL 33496
Tracy L. Decker 17,343
15341 Meadowwood
Grand Haven, Michigan 49417
Marlene Q. Helm 2,195
1301 Summac
Muskegon, Michigan 49445
Brian K. Orcutt 2,195
679 Lake Drive, S.E., Apt. #4
Grand Rapids, Michigan 49503
Ronald L. Piasecki 17,000 220
17854 W. Spring Lake Road
Spring Lake, Michigan 49456
James R. Lanting 3,704
5999 Hillsborough Court
Grandville, Michigan 49418
Aspen Enterprises, Ltd. 100,455
</TABLE>
32
<PAGE> 33
<TABLE>
<CAPTION>
SERIES A
PARTNERS COMMON PREFERRED PREFERRED
- -------- OP UNITS OP UNITS UNITS
-------- -------- -----
<S> <C> <C> <C>
2757 44th Street, S.W.
Suite 306
Grand Rapids, Michigan 49509
Aspen Group 55,556 364,819
2757 44th Street, S.W.
Suite 306
Grand Rapids, Michigan 49509
Aspen-Brentwood Village Limited 5,911
Partnership
2757 44th Street, S.W.
Suite 306
Grand Rapids, Michigan 49509
Aspen-West Michigan Investments 9,259
L.L.C., 2757 44th Street, S.W.
Suite 306
Grand Rapids, Michigan 49509
Aspen Group-HE 42,827
2757 44th Street, S.W.
Suite 306
Grand Rapids, Michigan 49509
Aspen - Grand Estates Limited 4,433
Partnership
2757 44th Street, S.W.
Suite 306
Grand Rapids, Michigan 49509
FC Group 201,411
2757 44th Street, S.W.
Suite 306
Grand Rapids, Michigan 49509
Aspen Group-KC 83,943 124,920
2757 44th Street, S.W.
Suite 306
Grand Rapids, Michigan 49509
Aspen-Paradise Investment Limited 18,210
Partnership
2757 44th Street, S.W.
Suite 306
</TABLE>
33
<PAGE> 34
<TABLE>
<CAPTION>
SERIES A
PARTNERS COMMON PREFERRED PREFERRED
- -------- OP UNITS OP UNITS UNITS
-------- -------- -----
<S> <C> <C> <C>
Grand Rapids, Michigan 49509
Aspen-Arbor Investment Limited 16,293
Partnership
Suite 306
2757 44th Street, S.W.
Grand Rapids, Michigan 49509
Aspen-Breezy Hill II Limited 58,199
Partnership
Suite 306
2757 44th Street, S.W.
Grand Rapids, Michigan 49509
Aspen-Indian Investment Limited 30,766
Partnership
Suite 306
2757 44th Street, S.W.
Grand Rapids, Michigan 49509
Aspen- Silver Investment Limited 20,834
Partnership
2757 44t Street, S.W.
Suite 306
Grand Rapids, Michigan 49509
Aspen-Bonita Investment Limited 42,673
Partnership
2757 44th Street, S.W.
Suite 306
Grand Rapids, Michigan 49509
Aspen-Siesta Investment Limited 75,982
Partnership
Suite 306
2757 44th Street, S.W.
Grand Rapids, Michigan 49509
Joyce L. Gollob 25,000
380 North Woodward Avenue, Suite
206
Birmingham, Michigan 48009
Margaret A. Bayer 7,747
5879 Seville Circle
Orchard Lake, MI 48324
</TABLE>
34
<PAGE> 35
<TABLE>
<CAPTION>
SERIES A
PARTNERS COMMON PREFERRED PREFERRED
- -------- OP UNITS OP UNITS UNITS
-------- -------- -----
<S> <C> <C> <C>
Carol P. Hearne 7,747
49373 Chesterfield Court
Shelby, MI 48315
Karen Matles 1,000
395 NW 101st Terrace
Coral Springs, FL 33071
Harold Matles 300
24 Sherwood Rd.
West Hartford, CT 06117
Linda Schiavoni 300
10 Cove Road
Sag Harbor, NY 11963
Judith Pendrick 300
24501 Falena Avenue
Torrance, CA 90501
Keith D. Smith 107,133
9241 Potter Road
Davison, MI 48423
Susan K. Smith 38,221
13015 Sandhurst Court
Grand Blanc, MI 48439
Kelly M. Karr 5,672
650 Kingswood Avenue
Eugene, Oregon 97401
Milton M. Shiffman 311,794
31700 Middlebelt Road
Suite 145
Farmington Hills, Michigan 48334
Anders I, LLC 13,158
361 71st Avenue
Greeley, CO 80634
Jeffrey P. Jorissen 100,000
c/o Sun Communities
31700 Middlebelt Road
Suite 145
Farmington Hills, Michigan 48334
Brian W. Fannon 30,000
c/o Sun Communities
</TABLE>
35
<PAGE> 36
<TABLE>
<CAPTION>
SERIES A
PARTNERS COMMON PREFERRED PREFERRED
- -------- OP UNITS OP UNITS UNITS
-------- -------- -----
<S> <C> <C> <C>
31700 Middlebelt Road
Suite 145
Farmington Hills, Michigan 48334
Jonathan M. Colman 7,500
c/o Sun Communities
31700 Middlebelt Road
Suite 145
Farmington Hills, Michigan 48334
Helene A. Lewis 4,000
c/o Sun Communities
31700 Middlebelt Road
Suite 145
Farmington Hills, Michigan 48334
Clunet R. Lewis 20,000
c/o Eltrax Systems, Inc.
2000 Town Center, Suite 690
Southfield, MI 48075
Arthur A. Weiss 50,000
c/o Jaffe, Raitt, Heuer & Weiss
1 Woodward Avenue, Suite 2400
Detroit, MI 48226
Ira J. Jaffe 6,300
c/o Jaffe, Raitt, Heuer & Weiss
1 Woodward Avenue, Suite 2400
Detroit, MI 48226
Jeffrey G. Heuer 9,500
c/o Jaffe, Raitt, Heuer & Weiss
1 Woodward Avenue, Suite 2400
Detroit, MI 48226
Brian M. Hermelin 35,000
20500 Civic Center Drive, Suite
3000
Southfield, MI 48076
Robert H. Orley 35,000
2000 N. Woodward Avenue
Suite 130
Bloomfield Hills, MI 48304
Daniel E. Bober 15,000
</TABLE>
36
<PAGE> 37
<TABLE>
<CAPTION>
SERIES A
PARTNERS COMMON PREFERRED PREFERRED
- -------- OP UNITS OP UNITS UNITS
-------- -------- -----
<S> <C> <C> <C>
39047 Geneva
Farmington Hills, MI 48331
Creighton J. Weber 5,000
5240 Hollow Drive
Bloomfield Hills, MI 48302
James A. Simpson 4,725
1235 Lyonhurst
Birmingham, MI 48009
Belcrest Realty Corporation 1,400,000
c/o Eaton Vance Management
The Eaton Vance Building
255 State Street
Boston, MA 02109
Belair Real Estate Corporation 600,000
c/o Eaton Vance Corporation
The Eaton Vance Building
255 State Street
Boston, MA 02109
</TABLE>
37
<PAGE> 1
EXHIBIT 99.3
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT"), dated as of
September 29, 1999, is entered into by and between SUN COMMUNITIES, INC., a
Maryland corporation (the "COMPANY"), and BELCREST REALTY CORPORATION, a
Delaware corporation ("BELCREST") and BELAIR REAL ESTATE CORPORATION, a Delaware
corporation ("BELAIR"; and together with Belcrest, the "CONTRIBUTORS").
RECITALS
WHEREAS, in connection with the offering of 3,000,000 9.125% Series A
Cumulative Redeemable Preferred Units (the "SERIES A PREFERRED UNITS") of Sun
Communities Operating Limited Partnership, a Michigan limited partnership (the
"OPERATING PARTNERSHIP"), Contributors contributed to the Operating Partnership
$50,000,000 in return for the Series A Preferred Units on terms and conditions
set forth in the Contribution Agreement, dated as of the date hereof, by and
among Belair, Belcrest, the Company and the Operating Partnership (the
"CONTRIBUTION AGREEMENT");
WHEREAS, the Contributors will receive the Series A Preferred Units in
exchange for cash contributed to the Operating Partnership;
WHEREAS, pursuant to that certain Second Amended and Restated Limited
Partnership Agreement of the Operating Partnership, dated as of April 30, 1996,
as amended by (i) those certain amendments numbered one through one hundred two,
and (ii) that certain One Hundred Third Amendment to the Second Amended and
Restated Limited Partnership Agreement of the Operating Partnership, dated as of
the date hereof, and as further amended from time to time (collectively, as
amended, the "AGREEMENT OF LIMITED PARTNERSHIP"), the Series A Preferred Units
owned by the Contributors or their successors and assigns will be redeemable for
cash or exchangeable for shares of the Company's 9.125% Series A Cumulative
Redeemable Preferred Stock (the "PREFERRED STOCK") upon the terms and subject to
the conditions contained therein; and
WHEREAS, in order to induce the Contributors to enter into the
Contribution Agreement, the Company has agreed to enter into this Agreement and
to provide registration rights set forth herein to the Contributors and any
subsequent holder or holders of the Series A Preferred Units and Registrable
Securities (as hereinafter defined).
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained, and for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
<PAGE> 2
1. DEFINITIONS.
As used in this Agreement, the following capitalized defined terms
shall have the following meanings:
"AFFILIATE" shall mean, when used with respect to a specified
Person, another Person that directly, or indirectly through one or more
intermediaries, controls or is controlled by or is under common control
with the Person specified.
"AGREEMENT" shall have the meaning set forth in the preamble.
"AGREEMENT OF LIMITED PARTNERSHIP" shall have the meaning set
forth therefor in the Recitals.
"BELAIR" shall have the meaning set forth in the preamble.
"BELCREST" shall have the meaning set forth in the preamble.
"CLOSING DATE" shall mean the date of closing of the Operating
Partnership's sale of Series A Preferred Units to the Contributors.
"COMPANY" shall have the meaning set forth in the preamble and
shall also include the Company's successors or other parties who
succeed to the Company's obligations hereunder.
"CONTRIBUTION AGREEMENT" shall have the meaning set forth in
the preamble.
"CONTRIBUTORS" shall have the meaning set forth in the
preamble and shall include their successors and permitted assigns.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934,
as amended, and any successor statute thereto, and the rules and
regulations of the SEC thereunder, all as the same shall be in effect
at the relevant time.
"HOLDER" shall mean (i) any Contributor or (ii) any Person
holding Registrable Securities as a result of a transfer or assignment
of Registrable Securities to that Person other than pursuant to an
effective Registration Statement or Rule 144 under the Securities Act,
in each case where securities sold in such transaction may be resold in
a public distribution without subsequent registration under the
Securities Act, and together the Persons described in clauses (i) and
(ii) hereof shall be "HOLDERS".
"INDEMNIFIED PARTY" shall have the meaning set forth in
SECTION 7(C) hereof.
-2-
<PAGE> 3
"INDEMNIFYING PARTY" shall have the meaning set forth in
SECTION 7(C) hereof.
"OPERATING PARTNERSHIP" shall have the meaning set forth
therefor in the Recitals.
"PERSON" shall mean an individual, partnership, corporation,
trust, or unincorporated organization, or government or agency or
political subdivision thereof.
"PIGGYBACK REGISTRATION" shall have the meaning set forth in
SECTION 2(C) hereof.
"PREFERRED STOCK" shall have the meaning set forth therefor in
the Recitals.
"PRIMARY REGISTRATION" shall have the meaning set forth in
SECTION 2(C) hereof.
"PROSPECTUS" shall mean the prospectus included in a
Registration Statement, including any preliminary Prospectus, and any
such Prospectus as amended or supplemented by any prospectus supplement
with respect to the terms of the offering of any portion of the
Registrable Securities covered by a Registration Statement, and by all
other amendments and supplements to such Prospectus, including
post-effective amendments, and in each case including all material
incorporated by reference therein.
"REGISTERING HOLDERS" shall have the meaning set forth in
SECTION 2(B) hereof.
"REGISTRABLE SECURITIES" shall mean (i) the shares of
Preferred Stock issued by the Company to the holders of the Series A
Preferred Units in exchange for the Series A Preferred Units and (ii)
any securities issued or issuable with respect to the Preferred Stock
issued in exchange for the Series A Preferred Units by way of a stock
split or stock dividend or in connection with a combination of shares
recapitalization, merger, consolidation or other reorganization;
provided, however, that the securities listed above shall cease to be
Registrable Securities to the extent that (i) a Registration Statement
with respect to such securities shall have been declared effective
under the Securities Act and remains effective as provided herein, (ii)
such securities are eligible for resale in a public distribution
pursuant to Rule 144 without holding periods or volume limitations
(iii) such securities have been disposed of pursuant to such
Registration Statement, or (iv) such shares have been otherwise
transferred pursuant to an applicable exemption under the Securities
Act, new certificates for such securities not bearing a legend
restricting further transfer shall have been delivered by the Company
and such securities shall be freely transferable to the public in a
transaction that would constitute a sale thereof without registration
under the Securities Act.
"REGISTRATION EXPENSES" shall mean any and all expenses
incident to the Company's performance of or compliance with this
Agreement, including without limitation: (i) all SEC, stock exchange or
National Association of Securities Dealers, Inc.
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("NASD") registration, listing and filing fees, (ii) all reasonable
fees and expenses incurred in connection with compliance with federal
or state securities or blue sky laws (including reasonable fees and
disbursements of counsel for any Underwriters and one counsel
(reasonably acceptable to Company) to the Holders in connection with
state or federal securities law compliance and blue sky qualification
of any of the Registrable Securities and the preparation of a "blue
sky" memorandum and compliance with the rules of the NASD), (iii) all
expenses of any Persons in preparing or assisting in preparing, word
processing, duplicating, printing, delivering and distributing any
Registration Statement, any Prospectus, any amendments or supplements
thereto, any underwriting agreements, securities sales agreements,
certificates and other documents relating to the performance of and
compliance with this Agreement, (iv) all fees and expenses incurred in
connection with the listing of any of the Registrable Securities on any
securities exchange or the Nasdaq National Market pursuant to SECTION
4(K) hereof, (v) the fees and disbursements of counsel for the Company
and of the independent public accountants of the Company (including,
without limitation, the expenses of any annual or special audit and
comfort letters required by the Underwriters), but excluding
underwriting discounts and commission and transfer taxes, if any,
relating to the sale or disposition of Registrable Securities by a
Holder; (vi) Securities Act liability insurance, if the Company so
desires; and (vii) fees and expenses of other Persons reasonably
necessary in connection with the registration, including any experts,
transfer agent or registrar, retained by the Company.
"REGISTRATION REQUEST" shall have the meaning set forth in
SECTION 2(B) hereof.
"REGISTRATION STATEMENT" shall mean a Registration Statement
of the Company which covers all of the Registrable Securities on an
appropriate form under the Securities Act, or any similar rule that may
be adopted by the SEC, and all amendments and supplements to such
Registration Statement, including post-effective amendments, in each
case including the Prospectus contained therein, all exhibits thereto
and all material incorporated by reference therein.
"RULE 144" shall mean Rule 144 promulgated under the
Securities Act, as such rule may be amended from time to time, or any
similar or regulation hereafter adopted by the SEC providing for offers
and sales of securities made in compliance therewith.
"SEC" shall mean the Securities and Exchange Commission or any
successor federal agency.
"SECURITIES ACT" shall mean the Securities Act of 1933, as
amended, and any successor statute thereto, and the rules and
regulations of the SEC thereunder, all as the same shall be in effect
at the relevant time.
"SERIES A PREFERRED UNITS" shall have the meaning therefor set
forth in the
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<PAGE> 5
Recitals.
"UNDERWRITER" means a securities dealer who purchases any
Registrable Securities as principal and not as part of such dealer's
market-making activities.
"UNDERWRITTEN OFFERING" shall mean a sale of securities of the
Company to an underwriter or underwriters for reoffering to the public.
2. REGISTRATION UNDER THE SECURITIES ACT.
(A) FILING OF SHELF REGISTRATION STATEMENT. The Company shall file
within sixty (60) days after all Series A Preferred Units shall be exchanged for
Preferred Stock, a "shelf" Registration Statement providing for the sale of all
of the Registrable Securities of the Holder. The Company shall use its best
efforts to cause such shelf Registration Statement to be declared effective by
the SEC within one hundred and twenty (120) days thereafter. The Company agrees
to use its best efforts to keep the shelf Registration Statement continuously
effective until the earliest of (A) 24 months following the effective date of
the Registration Statement, (B) such time as all of the Registrable Securities
have been sold pursuant to the Registration Statement or Rule 144, and (C) the
date on which the Registrable Securities may be sold without holding periods or
volume restrictions in accordance with Rule 144. Any offering pursuant to a
shelf registration provided for in this SECTION 2(A) may, at the election of the
Holders of a majority of the Registrable Securities, be an Underwritten
Offering.
(B) DEMAND REGISTRATION.
(i) At any time during which a shelf Registration Statement is
not effective with respect to the Registrable Securities, upon receipt
of a written request (a "REGISTRATION REQUEST"), which shall include a
description of such Holders' proposed method of distribution (which
method may, at the election of the Holders of a majority of the
Registrable Securities, also include an Underwritten Offering by a
nationally recognized Underwriter selected by the Company and
reasonably acceptable to the Registering Holders) from Holders holding
Registrable Securities having an aggregate expected offering price of
at least $25,000,000 (or, all remaining Registrable Securities if all
such remaining Registrable Securities shall have an aggregate expected
offering price of less than $25,000,000), the Company shall (i)
promptly give notice of the Registration Request to all non-requesting
Holders and (ii) prepare and file with the SEC, within sixty (60) days
after receipt of such Registration Request, a Registration Statement
for the sale of all Registrable Securities held by the requesting
Holders and any other Holder who makes a written request of the Company
to have her or his Registrable Securities included in such Registration
Statement, which such written request must be received by the Company
within ten (10) days after such Holder receives the Registration
Request (all of such Holders, collectively, the "REGISTERING HOLDERS").
Upon receipt of such written request, the Company shall use its best
efforts to cause such Registration Statement to be
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<PAGE> 6
declared effective within one hundred twenty (120) days after receipt
of a Registration Request. The Company shall keep such Registration
Statement continuously effective until the earlier of either: (i) the
date on which all Registrable Securities have been sold pursuant to
such Registration Statement or Rule 144 or (ii) two (2) years from the
effective date of the Registration Statement.
(ii) The Company shall not be required to effect more than
three registrations pursuant to this SECTION 2(B).
(iii) If any of the Registrable Securities registered pursuant
to a Registration Statement filed under this SECTION 2(B) are to be
sold in an Underwritten Offering, and the lead managing Underwriter
advises the Registering Holders in writing that in its opinion the
total number or dollar amount of Registrable Securities proposed to be
sold in such offering is such as to materially and adversely affect the
success of such offering, then the Company will include in such
registration, first, the Registrable Securities of the Registering
Holders and, second, any securities to be sold for the account of the
Company and for the account of other security holders of the Company
who have contractual rights to participate in such registration (the
"OTHER HOLDERS") electing to include (but not being entitled to demand
inclusion of) securities in such registration (it being understood that
such lead managing Underwriter shall have the right to eliminate
entirely the participation in such registration of the Company and such
Other Holders).
(iv) The Company shall be entitled to postpone, for a
reasonable period of time not in excess of ninety (90) days, the filing
of a Registration Statement of the Company, if it determines, in the
good faith exercise of its reasonable business judgement, that such
registration and offering could materially adversely affect the bona
fide financing plans of the Company or would require the disclosure of
information, the premature disclosure of which could materially
adversely affect the Company or any transaction under consideration by
the Company; provided, however, that the Company shall not be entitled
to such postponement more than once in any 360-day period.
(C) PIGGYBACK REGISTRATION RIGHTS.
(i) If the Company proposes to file a Registration Statement
under the Securities Act with respect to an offering by the Company for
its own account (a "PRIMARY REGISTRATION") or for the account of any of
its respective security holders (other than a registration statement on
Form S-4 or S-8 (or any substitute form that may be adopted by the SEC)
or filed in connection with an exchange offer or offering of securities
solely to the Company's existing security holders)(a "SECONDARY
REGISTRATION") and a Registration Statement is not otherwise effective
with respect to the Preferred Stock issuable upon exchange of the
Series A Preferred Units, then the Company shall promptly give written
notice of such proposed filing to the Holders of Registrable Securities
and such notice shall offer such Holders the opportunity to register
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<PAGE> 7
such number of shares of Registrable Securities as each such Holder may
request (a "PIGGYBACK REGISTRATION"). The Company shall use its all
commercially reasonable efforts to cause the managing Underwriter or
Underwriters of a proposed Underwritten Offering to permit the
Registrable Securities requested to be included in a Piggyback
Registration to be included on the same terms and conditions as any
similar securities of the Company included therein.
(ii) Any Holder requesting inclusion of Registrable Securities
pursuant to this SECTION 2(C) may, prior to the effective date of the
Registration Statement relating to such registration, revoke such
request by delivering written notice of such revocation to the Company
and the managing Underwriter, if any, at least two (2) business days
prior to the effective date of the registration; provided, however,
that if the Company, in consultation with its financial and legal
advisors, determines that such revocation would materially delay the
registration or otherwise require a recirculation of the Prospectus
contained in the Registration Statement, then such Holder shall have no
such right to revoke its request. If the withdrawal of any Registrable
Securities would allow, within the marketing limitations set forth
above, the inclusion in the underwriting of a greater number of shares
of Registrable Securities, then, to the extent practicable and without
delaying the underwriting, the Company shall offer to the Holders an
opportunity to include additional shares of Registrable Securities,
which additional Registrable Securities shall be included in such
registration pro rata among the holders of Registrable Securities
requesting such registration and the holders of such other securities
on the basis of the number of securities requested for inclusion in
such registration by each such holder. Any Registrable Securities
excluded or withdrawn from such underwriting shall also be withdrawn
from registration and shall not be transferred in a public distribution
prior to ninety (90) days after the effective date of the Registration
Statement relating thereto, or such shorter period of time as the
managing Underwriter may require.
(iii) The Company shall have the right to terminate or
withdraw any registration initiated by it under this SECTION 2(C) prior
to the effectiveness of such registration whether or not any Holder has
elected to include securities in such registration.
(D) REDUCTION IN AMOUNT OF SECURITIES. Notwithstanding anything
contained herein, if the managing Underwriter or Underwriters of an offering
described in this SECTION 2 are of the opinion that (i) the size of the offering
that the Holders, the Company and/or such other Persons intend to make, or (ii)
the kind of the securities that the Holders, the Company and/or any other
persons or entities intend to include in such offering are such that the success
of the offering would be materially and adversely affected by inclusion of the
Registrable Securities requested to be included, then (A) if the size of the
offering is the basis of such Underwriter's opinion, the amount of securities to
be offered for the accounts of Holders shall be reduced pro-rata (on the basis
of the Registrable Securities proposed for registration) to the extent necessary
to reduce the total amount of securities to be included in such offering to the
amount
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<PAGE> 8
recommended by such managing Underwriter or Underwriters; provided that if
securities are being offered for the account of other Persons as well as the
Company, then (1) in the case of a Primary Registration, the reduction in the
amount of securities requested to be offered shall be made first pro-rata among
securities offered for the accounts of Holders and such other Persons, and (2)
in the case of a Secondary Registration, the reduction in the amount of such
securities requested to be offered shall be made in accordance with the terms of
the registration rights agreement pursuant to which such Secondary Registration
is made, provided that if any such registration rights agreement is silent with
respect to reductions in shares being registered thereunder, then with respect
to the Registrable Securities intended to be offered by Holders, the proportion
by which the amount of such class of securities intended to be offered by
Holders is reduced shall not exceed the proportion by which the amount of such
class of securities intended to be offered by such other Persons is reduced, and
(B) if the combination of securities to be offered is the basis of such
Underwriter's opinion, (x) the Registrable Securities to be included in such
offering shall be reduced as described in clause (A) above, or (y) if the
actions described in clause (x) would, in the judgment of the managing
Underwriter, be insufficient to substantially eliminate the adverse effect that
inclusion of the Registrable Securities requested to be included would have on
such offering, such Registrable Securities will be excluded from such offering.
(E) EXPENSES. The Company shall pay all Registration Expenses
in connection with any registration undertaken pursuant to SECTIONS 2(A), 2(B)
and 2(C) hereof. The Holder shall pay all underwriting discounts and commissions
and transfer taxes, if any, relating to the sale or disposition of such Holder's
Registrable Securities pursuant to the Registration Statement.
3. HOLD-BACK AGREEMENT.
Each Holder of Registrable Securities shall not effect any public sale
or distribution of securities of the Company of the same or similar class or
classes of the securities included in the Registration Statement or any
securities convertible into or exchangeable or exercisable for such securities,
including a sale pursuant to Rule 144 or Rule 144A under the Securities Act,
during such periods as reasonably requested by the Underwriter in an
underwritten public offering by the Company; provided that no Holder shall be so
obligated under this SECTION 3 in the event that any such period requested by
the Underwriter is longer than one hundred (100) days or occurs more than once
in any twelve (12) month period.
4. REGISTRATION PROCEDURES.
In connection with the obligations of the Company with respect to a
Registration Statement pursuant to SECTIONS 2(A), 2(B) and 2(C) hereof, the
Company shall use its best efforts to effect or cause to be effected the
registration of the Registrable Securities under the Securities Act to permit
the sale of such Registrable Securities by the Holder in accordance with its
intended method or methods of distribution, and the Company shall:
(A) prepare and file with the SEC, as specified in SECTION 2
hereof, a Registration
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<PAGE> 9
Statement, which Registration Statement shall comply as to form in all material
respects with the requirements of the applicable form and include all financial
statements required by the SEC to be filed therewith, and use its best efforts
to cause such Registration Statement to become effective and remain effective in
accordance with SECTION 2 hereof;
(B) subject to SECTION 4(J) hereof, prepare and file with the SEC
such amendments and post-effective amendments to each such Registration
Statement as may be necessary to keep such Registration Statement effective for
the applicable period; cause each such Prospectus to be supplemented by any
required prospectus supplement, and as so supplemented to be filed pursuant to
Rule 424 or any similar rule that may be adopted under the Securities Act; and
comply with the provisions of the Securities Act with respect to the disposition
of all securities covered by each Registration Statement during the applicable
period in accordance with the intended method or methods of distribution by the
selling Holder thereof;
(C) furnish to the Holder of Registrable Securities without
charge, as many copies of each Prospectus, including each summary prospectus or
preliminary Prospectus, and any amendment or supplement thereto and such other
documents as such Holder may reasonably request, in order to facilitate the
public sale or other disposition of the Registrable Securities; the Company
consents to the use of any such Prospectus, including each preliminary
Prospectus, by the Holder of Registrable Securities, if any, in connection with
the offering and sale of the Registrable Securities covered by any such
Prospectus;
(D) use its best efforts to register or qualify, or obtain
exemption from registration or qualification for, all Registrable Securities by
the time the applicable Registration Statement is declared effective by the SEC
under all applicable state securities or "blue sky" laws of such jurisdictions
as the Holder of Registrable Securities covered by a Registration Statement
shall reasonably request in writing, keep each such registration or
qualification or exemption effective during the period such Registration
Statement is required to be kept effective and do any and all other acts and
things which may be reasonably necessary or advisable to enable such Holder to
consummate the disposition in each such jurisdiction of such Registrable
Securities owned by such Holder; provided, however, that the Company shall not
be required to (i) qualify generally to do business in any jurisdiction or to
register as a broker or dealer in such jurisdiction where it would not otherwise
be required to qualify but for this SECTION 4(D), (ii) subject itself to
taxation in any such jurisdiction, or (iii) submit to the general service of
process in any such jurisdiction;
(E) notify the Holder of Registrable Securities promptly and, if
requested by such Holder, confirm such advice in writing (i) when a Registration
Statement has become effective and when any post-effective amendments and
supplements thereto become effective, (ii) of the issuance by the SEC or any
state securities authority of any stop order suspending the effectiveness of a
Registration Statement or the initiation of any proceedings for that purpose,
and (iii) of the happening of any event during the period a Registration
Statement is effective as a result of which such Registration Statement or the
related Prospectus contains any untrue statement of a material fact or omits to
state any material fact required to be stated therein or
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<PAGE> 10
necessary to make the statements therein not misleading, and (iv) of the
Company's receipt of any notification of the suspension of the qualification of
any Registrable Securities covered by a Registration Statement for sale in any
jurisdiction; in the event the Company shall give notice as to the occurrence of
any event described SECTIONS 4(E)(II), 4(E)(III) or 4(E)(IV) hereof, the Company
shall extend the period during which such Registration Statement shall be
maintained effective by the number of days during the period from and including
the date of the giving of such notice to the date the Company delivers notice
that disposition may be made;
(F) furnish to the Holder of Registrable Securities copies of any
request by the SEC or any state securities authority of amendments or
supplements to a Registration Statement and Prospectus or for additional
information;
(G) make all commercially reasonable efforts to obtain the
withdrawal of any order suspending the effectiveness of a Registration Statement
at the earliest possible moment;
(H) provide to the Holders, at no cost to such Holders, a copy of
the Registration Statement and any amendment thereto with respect to Registrable
Securities, each Prospectus contained in such Registration Statement or
post-effective amendment and any amendment or supplement thereto and such other
documents as such Holders may reasonably request in order to facilitate the
disposition of their Registrable Securities covered by such Registration
Statement; the Company consents to the use of each such Prospectus and any
supplement thereto by such Holders in connection with the offering and sale of
their Registrable Securities covered by such Registration Statement or any
amendment thereto;
(I) upon the occurrence of any event contemplated by SECTION
4(E)(III) hereof, promptly notify all Holders of the Registrable Securities
affected by such event of such event and prepare and provide to such Holders a
supplement or post-effective amendment to a Registration Statement or the
related Prospectus or any document incorporated therein by reference and file
any required document so that, as thereafter delivered to the purchasers of the
Registrable Securities, such Prospectus will not contain any untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
(J) make available for inspection by representatives of the Holder
of the Registrable Securities and any Underwriters participating in any
disposition pursuant to a Registration Statement and any special counsel or
accountant retained by such Holders or Underwriters, all financial and other
records, pertinent corporate documents and properties of the Company as shall be
reasonably necessary to enable them to exercise their due diligence
responsibility and cause the respective officers, directors and employees of the
Company to supply all information reasonably requested by any such
representative, Underwriter, special counsel or accountant in connection with a
Registration Statement; provided, however, that such records, documents or
information which the Company determines, in good faith, to be confidential and
notifies such representatives, Underwriter's special counsel or accountants are
confidential shall not be
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<PAGE> 11
disclosed by the representatives, Underwriter's special counsel or accountants
unless (i) the disclosure of such records, documents or information is necessary
to avoid or correct a misstatement or omission in a Registration Statement, (ii)
the release of such records, documents or information is ordered pursuant to a
subpoena or other order from a court of competent jurisdiction, or (iii) such
records, documents or information have been generally made available to the
public. Each Holder agrees that information obtained by it as a result of such
inspections shall be deemed confidential and shall not be used by it as the
basis for any market transactions in the securities of the Company or its
Affiliates or otherwise disclosed by it unless and until such is made generally
available to the public;
(K) use its best efforts (including, without limitation, seeking
to cure any deficiencies (within the Company's control) cited by such exchange
or market in the Company's listing application) to list all Registrable
Securities on The New York Stock Exchange (unless the Company qualifies and
chooses to list all Registrable Securities on the American Stock Exchange or The
Nasdaq National Market, in which event the Company shall use its best efforts to
list all Registrable Securities on the American Stock Exchange or The Nasdaq
National Market);
(L) use its best efforts to obtain a CUSIP number for all
Registrable Securities, not later than the effective date of the Registration
Statement;
(M) use best efforts to comply with the Securities Act and the
Exchange Act in connection with the offer and sale of the Registrable Securities
to be sold pursuant to a Registration Statement, and, make available to its
security holders, as soon as reasonably practicable, an earnings statement
covering at least twelve (12) months which shall satisfy the provisions of
Section 11(a) of the Securities Act and Rule 158 thereunder;
(N) provide and cause to be maintained a transfer agent for all
Registrable Securities covered by such Registration Statement from and after a
date not later than the effective date of such Registration Statement;
(O) cooperate with the Holders to facilitate the timely
preparation and delivery of certificates representing their Registrable
Securities to be sold pursuant to a Registration Statement and not bearing any
Securities Act legend; and enable certificates for such Registrable Securities
be issued for such numbers of shares and registered in such names as such
Holders may reasonably request at least two (2) business days prior to any sale
of their Registrable Securities;
(P) enter into customary agreements (including an underwriting
agreement or securities sales agreement, if any, in customary form) containing
such representations and warranties to the Holders of such Registrable
Securities and the Underwriters, if any, in form, substance and scope as are
customarily made by issuers to underwriters in similar underwritten offerings as
may be reasonably requested by them and take such other actions as are
reasonably
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required in order to expedite or facilitate the disposition of such Registrable
Securities; and
(Q) furnish to each registering Holder of Registrable Securities
and to each Underwriter, if any, a signed counterpart, addressed to such
registering Holder of Registrable Securities or Underwriter, of (i) an opinion
or opinions of counsel to the Company and (ii) a comfort letter or comfort
letters from the Company's independent public accountants (to the extent
permitted by the standards of the American Institute of Certified Public
Accountants), each in customary form and covering such matters of the type
customarily covered by opinions or comfort letters, as the case may be, as the
Holders of a majority of the Registrable Securities included in such offering or
the managing Underwriter or Underwriters therefor reasonably request.
The Company may require, as a condition precedent to the obligations of
the Company under this Agreement, each registering Holder of Registrable
Securities to promptly furnish in writing to the Company such information
regarding such Holder, the Registrable Securities held by it and the intended
method of distribution of the Registrable Securities as the Company may from
time to time reasonably request and such other information as may be legally
required in connection with such registration.
The Holders agree that, upon receipt of any notice from the Company of
the happening of any event of the kind described in SECTION 4(E)(III) hereof,
such Holder will immediately discontinue disposition of Registrable Securities
pursuant to a Registration Statement until such Holders' receipt of the copies
of the supplemented or amended Prospectus, and if so directed by the Company,
such Holders will deliver to the Company (at the expense of the Company) all
copies in its possession, other than permanent file copies then in such Holders'
possession, of the Prospectus covering such Registrable Securities current at
the time of receipt of such notice. Each Holder of Registrable Securities shall
promptly notify the Company at any time when a Prospectus relating to the
registration of such Registrable Securities is required to be delivered under
the Securities Act of the happening of an event as a result of which information
previously furnished by such Holder to the Company in writing for inclusion in
such Prospectus contains an untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they were made, not
misleading.
5. BLACK-OUT PERIOD.
(A) Notwithstanding anything in SECTION 2(B)(IV) above to the
contrary, if (1) the Company determines in its good faith judgment that the
filing of a Registration Statement under SECTION 2 hereof or the use of any
related Prospectus would require the disclosure of non-public material
information that the Company has a bona fide business purpose for preserving as
confidential or the disclosure of which would impede the Company's ability to
consummate a material transaction, and that the Company is not otherwise
required by applicable securities laws or regulations to disclose, or (2) all
reports required to be filed by the Company pursuant to
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the Exchange Act have not been filed by the required date without regard to any
extension, or if the consummation of any business combination by the Company has
occurred or is probable for purposes of Rule 3-05 or Article 11 of Regulation
S-X under the Act; then in either event and upon written notice of such by the
Company, the rights of the Holders to offer, sell or distribute any Registrable
Securities pursuant to the Registration Statement (shelf or otherwise, as
appropriate) or to require the Company to take action with respect to the
registration or sale of any Registrable Securities pursuant to the Registration
Statement (shelf or otherwise, as appropriate) shall be suspended until the
earlier of (i) the date upon which the Company notifies the Holders in writing
that suspension of such rights for the grounds set forth in this Section 5 is no
longer necessary, and (ii) one hundred twenty (120) days. The Company shall give
such notice as promptly as practicable following the date that such suspension
of rights is no longer necessary and the period of time for which the Company
shall be obligated to keep the Registration Statement effective under SECTION 2
shall be extended by one day for each day of such suspension period.
(B) In the case of an event which causes the Company to suspend
the effectiveness of a Registration Statement (a "SUSPENSION EVENT"), the
Company may give notice (a "SUSPENSION NOTICE") to the Holder to suspend sales
of the Registrable Shares so that the Company may correct or update the
Registration Statement (or such filings); provided, however, that such
suspension shall continue only for so long as the Suspension Event or its effect
is continuing. The Holder agrees that it will not effect any sales of the
Registrable Shares pursuant to such Registration Statement (or such filings) at
any time after it has received a Suspension Notice from the Company. If so
directed by the Company, Holder will deliver to the Company all copies of the
Prospectus covering the Registrable Shares held by them at the time of receipt
of the Suspension Notice. The Holder may recommence effecting sales of the
Registrable Shares pursuant to the Registration Statement (or such filings)
following further notice to such effect (an "END OF SUSPENSION NOTICE") from the
Company, which End of Suspension Notice shall be given by the Company promptly
following the conclusion of any Suspension Event and the effectiveness of any
required amendment or supplement to the Registration Statement.
(C) Notwithstanding the provisions of SECTIONS 5(A) and 5(B) to
the contrary no Suspension Notice may be given more than once in any twelve (12)
month period. Moreover, notwithstanding SECTIONS 2(A), 2(B) and 2(C) hereof, if
the Company shall give a Suspension Notice pursuant to this SECTION 5, the
Company agrees that it shall extend the period during which the Registration
Statement shall be maintained effective pursuant to this Agreement by the number
of days during the period from the date of the giving of the Suspension Notice
to and including the date when the Holders shall have received the End of
Suspension Notice and copies of the supplemented or amended Prospectus necessary
to resume sales.
6. RULE 144 AND RULE 144A.
For so long as the Company is subject to the reporting requirements of
Section 13 or 15 of the Exchange Act, the Company covenants that it will timely
file the reports required to be
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filed by it under the Securities Act and Section 13(a) or 15(d) of the Exchange
Act and the rules and regulations adopted by the SEC thereunder and, if at any
time the Company is not required to file such reports, it will, upon the request
of any Holder of Registrable Securities, make publicly available other
information so long as necessary to permit sales pursuant to Rule 144 under the
Securities Act. The Company also covenants that it will provide the information
required pursuant to Rule 144A(d)(4) under the Securities Act upon the request
of any Holder of Registrable Securities and it will take such further action as
any Holder of Registrable Securities may reasonably request, all to the extent
required from time to time, to enable such Holder to sell its Registrable
Securities without registration under the Securities Act within the limitation
of the exemptions provided by (a) Rule 144 under the Securities Act, as such
Rule may be amended from time to time, (b) Rules 144A under the Securities Act,
as such Rule may be amended from time to time, or (c) any similar rule or
regulation hereafter adopted by the SEC. Upon the request of any Holder of
Registrable Securities, the Company will deliver to such Holder a written
statement as to whether it has complied with such requirements.
7. INDEMNIFICATION.
(A) The Company will indemnify each Holder, each such Holder's
officers and directors, and each person controlling such Holder within the
meaning of Section 15 of the Securities Act, against all claims, losses,
damages, liabilities and expenses (including reasonable legal expenses), arising
out of or based on any untrue statement (or alleged untrue statement) of a
material fact contained in any Registration Statement or prospectus relating to
such Holders' Registrable Securities, or any amendment or supplement thereto, or
based on any omission (or alleged omission) to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading; provided, however, that the Company will not indemnify and will not
be liable to any Holder in any such case to the extent that any such claim,
loss, damage, liability or expense arises out of or is based on any untrue
statement or omission or alleged untrue statement or omission, made in
conformity with and in reliance upon information furnished in writing to the
Company by such Holder or by an Underwriter for inclusion therein.
(B) Each Holder will indemnify the Company, each of its officers
and directors, each underwriter, if any, of the Company's securities covered by
such Registration Statement, and each person who controls the Company or such
underwriter within the meaning of Section 15 of the Securities Act, against all
claims, losses, damages, liabilities and expenses (including reasonable legal
fees and expenses) arising out of or based on any untrue statement (or alleged
untrue statement) of a material fact contained in any such Registration
Statement or prospectus, or any amendment or supplement thereto, or based on any
omission (or alleged omission) to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement (or
alleged untrue statement) or omission (or alleged omission) is made in such
Registration Statement or prospectus, in reliance upon and in conformity with
information furnished in writing to the Company by such Holder for inclusion
therein.
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<PAGE> 15
(C) Each party entitled to indemnification under this SECTION 7
(the "INDEMNIFIED PARTY") shall give notice to the party required to provide
indemnification (the "INDEMNIFYING PARTY") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought. However,
the failure to so notify the Indemnifying Party shall not relieve the
Indemnifying Party from any liability which it may have to the Indemnified Party
pursuant to the provisions of this SECTION 7, except to the extent of the actual
damages suffered by such delay in notification. The Indemnifying Party shall
assume the defense of such action. including the employment of counsel, which
shall be chosen by the Indemnifying Party and shall be reasonably satisfactory
to the Indemnified Party, and payment of expenses in connection with such
defense. The Indemnified Party shall have the right to employ its own counsel in
any such case, but the legal fees and expenses of such counsel shall be at the
expense of the Indemnified Party unless (i) the employment of such counsel shall
have been authorized in writing by the Indemnifying Party, (ii) the Indemnifying
Party shall not have assumed the defense of such action within a reasonable
period of time, or (iii) the Indemnified Party shall have been reasonably
advised by its counsel that there may be defenses available to it or them which
are different from or additional to those available to Indemnifying Party (in
which case the Indemnifying Party shall not have the right to direct the defense
of such action on behalf of the Indemnified Party), in any of which events such
fees and expenses shall be borne by the Indemnifying Party. No Indemnifying
Party in the defense of any such claim or litigation, shall, except with the
consent of each Indemnified Party, consent to the entry of any judgment or enter
into any settlement that does not include as an unconditional term thereof the
giving by the claimant or plaintiff to each such Indemnified Party of a release
from all liability in respect to such claim or litigation.
(D) If the indemnification provided for in this SECTION 7 is
unavailable to a party that would have been an Indemnified Party under this
SECTION 7, then each party that would have been an Indemnifying Party hereunder
shall, in lieu of indemnifying such Indemnified Party, contribute to the amount
paid or payable by such Indemnified Party as a result of such claims, losses,
damages, liabilities and expenses in such proportion as is appropriate to
reflect the relative fault of the Indemnifying Party on the one hand and such
Indemnified Party on the other in connection with the statement or omission
which resulted in such claims, losses, damages, liabilities and expenses, as
well as any other relevant equitable considerations. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact related to information supplied by the Indemnifying Party or the
Indemnified Party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and each Holder agree that it would not be just and equitable if
contribution pursuant to this SECTION 7 were determined by pro rata allocation
or by any other method of allocation that fails to take account of the equitable
considerations referred to above in this SECTION 7(D). For purposes of this
SECTION 7(D), each person, if any, who controls the Holder within the meaning of
Section 15 of the Securities Act shall have the same rights to contribution
as the Holder and each trust manager of the Company, each officer of the Company
who signed the Registration Statement and each person, if any, who controls the
Company
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<PAGE> 16
within the meaning of Section 15 of the Securities Act shall have the same
rights to contribution as the Company.
(E) No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(F) In no event shall any Holder be liable for any claims, losses,
damages, liabilities or expenses pursuant to this SECTION 7 in excess of the net
proceeds to such Holder for the sale of such Holder's Registrable Securities
pursuant to a registration.
8. MISCELLANEOUS.
(A) NO INCONSISTENT AGREEMENT. The Company has not entered into
nor will the Company on or after the date of this Agreement enter into any
agreement which is inconsistent with the rights granted to the Holder of
Registrable Securities in this Agreement or otherwise conflicts with the
provisions hereof. The rights granted to the Holder do not in any way conflict
with and are not inconsistent with the rights granted to the holder of the
Company's other issued and outstanding securities under any such agreements.
(B) AMENDMENTS AND WAIVERS. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given without the written consent of the Company and Holders holding
at least a majority of the total then outstanding (i) Registrable Securities and
(ii) Series A Preferred Units not theretofore exchanged for Preferred Stock.
(C) NOTICES. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, telex, facsimile, or any courier guaranteeing overnight
delivery (i) if to the Contributors, at the address or facsimile number set
forth below its signature hereon, and thereafter at such other address or
facsimile number, notice of which is given in accordance with the provisions of
this SECTION 8(C), (ii) if to an assignee or transferee of the Contributors, to
such address or facsimile number such assignee or transferee shall have provided
to the Company, and (iii) if to the Company, at 31700 Middlebelt Road, Suite
145, Farmington Hills, Michigan 48334, facsimile number (248) 932- 3072, and
thereafter at such other address or facsimile number, notice of which is given
in accordance with the provisions of this SECTION 8(C), with a copy to JAFFE,
RAITT, HEUER & WEISS, Attention: Arthur A. Weiss, Esq., Suite 2400, One Woodward
Avenue, Detroit, Michigan 48226, facsimile number (313) 961-8358. All such
notices and communications shall be deemed to have been duly given: at the time
delivered by hand, if personally delivered; five (5) business days after being
deposited in the mail, postage prepaid, if mailed; when answered back, if
telexed; when receipt is acknowledged, if faxed; and on the next business day if
timely delivered to an air courier guaranteeing overnight delivery.
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<PAGE> 17
(D) SUCCESSORS. The rights and obligations of any Holder hereunder
may only be assigned to any other Holder or to any assignee of the Series A
Preferred Units permitted under the Agreement of Limited Partnership. This
Agreement shall inure to the benefit of and be binding upon the permitted
successors and assigns of the Company and the Holder.
(E) COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(F) HEADINGS. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.
(G) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF MICHIGAN, WITHOUT
GIVING EFFECT TO THE CONFLICTS OF LAW PROVISIONS THEREOF. EACH OF THE PARTIES
HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF
MARYLAND IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT.
(H) SEVERABILITY. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
(I) SPECIFIC PERFORMANCE. The parties hereto acknowledge that
there would be no adequate remedy at law if any party fails to perform any of
its obligations hereunder, and accordingly agree that each party, in addition to
any other remedy to which it may be entitled at law or in equity, shall be
entitled to compel specific performance of the obligations of any other party
under this Agreement to accordance with the terms and conditions of this
Agreement in any court of the United States or any State thereof having
jurisdiction.
(J) ENTIRE AGREEMENT. This Agreement is intended by the parties as
a final expression of their agreement and intended to be a complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to the
subject matter hereof.
(K) ATTORNEYS' FEES. If the Company or any Holder brings an action
to enforce its rights under this Agreement, the prevailing party in the action
shall be entitled to recover its costs and expenses, including without
limitation, reasonable attorneys' fees, incurred in connection with such action,
including any appeal of such action.
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<PAGE> 18
(L) AUTHORITY; BINDING EFFECT. Each party hereto represents and
warrants that it has the full legal right, power and authority to execute this
Agreement, that this Agreement has been duly authorized, executed and delivered
on behalf of such party and constitutes a valid and binding agreement of such
party enforceable in accordance with its terms.
(M) LIMITATION ON PARTICIPATION IN UNDERWRITTEN PARTICIPATION. No
Person may participate in any underwritten registration hereunder unless such
Person (i) agrees to sell such Person's securities on the basis provided in any
underwriting arrangements approved by the Persons entitled hereunder to approve
such arrangements, and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents in customary
form and reasonably required under the terms of such underwriting arrangements
and the registration rights provided for in SECTION 2.
(SIGNATURES APPEAR ON NEXT PAGE)
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<PAGE> 19
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
SUN COMMUNITIES, INC.
By: /s/ Jeffrey P. Jorissen
--------------------------------------------------
Name: Jeffrey P. Jorissen
Title: Chief Financial Officer
BELCREST REALTY CORPORATION
By: /s/ William R. Cross
--------------------------------------------------
Name: William R. Cross
Title: Vice President
Address: c/o Eaton Vance Management
The Eaton Vance Building
255 State Street
Boston, Massachusetts 02109
Attention: Alan Dynner
Facsimile: (617) 388-8054
BELAIR REAL ESTATE CORPORATION
By: /s/ William R. Cross
--------------------------------------------------
Name: William R. Cross
Title: Vice President
Address: c/o Eaton Vance Management
The Eaton Vance Building
255 State Street
Boston, Massachusetts 02109
Attention: Alan Dynner
Facsimile: (617) 388-8054
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