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EXHIBIT 10.3
EXCHANGE RIGHTS AGREEMENT
THIS EXCHANGE RIGHTS AGREEMENT (this "AGREEMENT"), dated as of
May 10, 1996, is entered into by and among Ramco-Gershenson Properties Trust, a
Massachusetts business trust, formerly known as RPS Realty Trust (the
"COMPANY"), and the Persons whose names are set forth on Exhibit A attached
hereto (as it may be amended from time to time).
R E C I T A L S:
A. The Company, as general partner, and the Limited Partners have
formed Ramco-Gershenson Properties, L.P., a Delaware limited partnership (the
"OPERATING PARTNERSHIP"), pursuant to the Amended and Restated Agreement of
Limited Partnership of the Operating Partnership dated the date hereof (the
"PARTNERSHIP AGREEMENT").
B. Pursuant to the Partnership Agreement, the Limited Partners hold
units of limited partnership interest ("OP UNITS") in the Operating Partnership.
C. The Company has agreed to provide the Limited Partners with
certain rights to exchange their OP Units for the Company's shares of beneficial
interest, par value $.10 per share ("REIT SHARES") in order to induce each of
the Limited Partners to enter into a Lock-Up Agreement with the Company dated
the date hereof.
Accordingly, the parties hereto do hereby agree as follows:
ARTICLE 1
DEFINED TERMS
The following definitions shall be for all purposes, unless otherwise
clearly indicated to the contrary, applied to the terms used in this Agreement.
"ASSIGNEE" means a Person to whom one or more OP Units have been
transferred in a manner determined under the Partnership Agreement, but who has
not become a substituted limited partner in accordance therewith.
"BUSINESS DAY" means any day except a Saturday, Sunday or other day on
which commercial banks in New York, New York are authorized or required by law
to close.
"CASH AMOUNT" means an amount of cash per OP Unit equal to the Value
on the Valuation Date of the REIT Shares Amount.
"DECLARATION OF TRUST" means the Declaration of Trust, dated as of
October 14, 1988, as amended.
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"EXCHANGE FACTOR" means 1.0, provided, that in the event that the
Company (i) declares or pays a dividend on its outstanding REIT Shares in REIT
Shares or makes a distribution to all holders of its outstanding REIT Shares in
REIT Shares; (ii) subdivides its outstanding REIT Shares; or (iii) combines its
outstanding REIT Shares into a smaller number of REIT Shares, the Exchange
Factor shall be adjusted by multiplying the Exchange Factor by a fraction, the
numerator of which shall be the number of REIT Shares issued and outstanding on
the record date for such dividend, distribution, subdivision or combination
assuming for such purpose that such dividend, distribution, subdivision or
combination has occurred as of such time, and the denominator of which shall be
the actual number of REIT Shares (determined without the above assumption)
issued and outstanding on the record date for such dividend, distribution,
subdivision or combination. Any adjustment to the Exchange Factor shall become
effective immediately after the effective date of such event retroactive to the
record date, if any, for such event.
"EXCHANGING PARTNER" has the meaning set forth in Section 2.1 hereof.
"EXCHANGE RIGHT" has the meaning set forth in Section 2.1 hereof.
"LIEN" means any lien, security interest, mortgage, deed of trust,
charge, claim, encumbrance, pledge, option, right of first offer or first
refusal and any other right or interest of others of any kind or nature, actual
or contingent, or other similar encumbrance of any nature whatsoever.
"LIMITED PARTNER" means the Company and any other Person named as a
Limited Partner on Exhibit A, as such Exhibit may be amended from time to time.
"NOTICE OF EXCHANGE" means the Notice of Exchange substantially in the
form of Exhibit B to this Agreement.
"RAMCO TRANSACTION" means the transactions pursuant to which the
Company and Ramco-Gershenson, Inc. shall have contributed certain assets and
properties to the Operating Partnership.
"REIT SHARES AMOUNT" means that number of REIT Shares equal to the
product of the number of OP Units offered for exchange by an Exchanging Partner,
multiplied by the Exchange Factor as of the Valuation Date, provided, that in
the event the Company issues to all holders of REIT Shares rights, options,
warrants or convertible or exchangeable securities entitling the shareholders to
subscribe for or purchase REIT Shares, or any other securities or property
(collectively, the "rights"), then the REIT Shares Amount shall also include
such rights that a holder of that number of REIT Shares would be entitled to
receive.
"SEC" means the Securities and Exchange Commission.
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"SPECIFIED EXCHANGE DATE" means the tenth (10th) Business Day after
receipt by the Company and by the Operating Partnership of a Notice of Exchange.
"VALUATION DATE" means the date of receipt by the Company of a Notice
of Exchange or, if such date is not a Business Day, the first Business Day
thereafter.
"VALUE" means, with respect to a REIT Share, the average of the daily
market price for the five (5) consecutive trading days immediately preceding the
Valuation Date. The market price for each such trading day shall be: (i) if
the REIT Shares are listed or admitted to trading on any national securities
exchange or the NASDAQ National Market System, the closing price on such day, or
if no such sale takes place on such day, the average of the closing bid and
asked prices on such day; (ii) if the REIT Shares are not listed or admitted to
trading on any national securities exchange or the NASDAQ National Market
System, the last reported sale price on such day or, if no sale takes place on
such day, the average of the closing bid and asked prices on such day, as
reported by a reliable quotation source designated by the Company; or (iii) if
the REIT Shares are not listed or admitted to trading on any national securities
exchange or the NASDAQ National Market System and no such last reported sale
price or closing bid and asked prices are available, the average of the reported
high bid and low asked prices on such day, as reported by a reliable quotation
source designated by the Company, or if there shall be no bid and asked prices
on such day, the average of the high bid and low asked prices, as so reported,
on the most recent day (not more than five (5) days prior to the date in
question) for which prices have been so reported; provided, that if there are no
bid and asked prices reported during the five (5) days prior to the date in
question, the Value of the REIT Shares shall be determined by the independent
trustees of the Company acting in good faith on the basis of such quotations and
other information as it considers, in its reasonable judgment, appropriate. In
the event the REIT Shares Amount includes rights that a holder of REIT Shares
would be entitled to receive, then the Value of such rights shall be determined
by the Company acting in good faith on the basis of such quotations and other
information as it considers, in its reasonable judgment, appropriate.
ARTICLE 2
EXCHANGE RIGHT
Section 2.1 Exchange Right.
A. Subject to Sections 2.1.B, 2.1.C, 2.1.D and 2.1.E hereof, the
Company hereby grants to the Limited Partners and the Limited Partners do hereby
accept the right (the "EXCHANGE RIGHT"), exercisable on or after the date one
(1) year after the closing of the Ramco Transaction, to exchange on a Specified
Exchange Date all or a portion of the OP Units held by such Limited Partner at
an exchange price equal to and in the form of the REIT Shares Amount to be paid
by the Company. The Exchange Right shall be exercised pursuant to a Notice of
Exchange delivered to the Company and to the Operating
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Partnership by the Limited Partner who is exercising the Exchange Right (the
"EXCHANGING PARTNER"); provided, however, that the Operating Partnership may
exchange the OP Units subject to the Notice of Exchange in accordance with
Section 2.1.B. A Limited Partner may not exercise the Exchange Right for less
than one thousand (1,000) OP Units or, if such Limited Partner holds less than
one thousand (1,000) OP Units, all of the OP Units held by such Limited Partner.
Any Assignee of a Limited Partner may exercise the rights of such Limited
Partner pursuant to this Section 2.1, and such Limited Partner shall be deemed
to have assigned such rights to such Assignee and shall be bound by the exercise
of such rights by such Assignee. In connection with any exercise of such rights
by an Assignee on behalf of a Limited Partner, the REIT Shares Amount shall be
paid by the Operating Partnership directly to such Assignee and not to such
Limited Partner.
B. Notwithstanding the provisions of Section 2.1.A, the Operating
Partnership may, in its sole and absolute discretion, elect to satisfy an
Exchanging Partner's Exchange Right by paying to the Exchanging Partner the Cash
Amount on the Specified Exchange Date. If the Operating Partnership shall elect
to exercise its right to purchase OP Units for the Cash Amount under this
Section 2.1.B with respect to a Notice of Exchange, it shall so notify the
Exchanging Partner within five Business Days after the receipt by it of such
Notice of Exchange. In the event the Operating Partnership shall elect to
satisfy an Exchanging Partner's Exchange Right by exchanging REIT Shares for the
OP Units offered for exchange, each Exchanging Partner agrees to execute such
documents as the Operating Partnership may reasonably require in connection with
the issuance of REIT Shares upon exercise of the Exchange Right.
C. Notwithstanding the provisions of Section 2.1.A and Section 2.1.B,
a Limited Partner shall not be entitled to exercise the Exchange Right pursuant
to Section 2.1.A if the delivery of REIT Shares to such Partner on the Specified
Exchange Date by the Company pursuant to Section 2.1.A (regardless of whether or
not the Operating Partnership would in fact exercise its rights under Section
2.1.B) would be prohibited under the Declaration of Trust of the Company.
D. Notwithstanding the provisions of Section 2.1.A and Section 2.1.B,
the Exchange Right may be exercised prior to the date which is one (1) year
after the closing of the Ramco Transaction (i) with the prior written consent of
at least a majority of the Company's independent trustees or (ii) in the event
of the death of a Limited Partner prior to such date, to the minimum extent
necessary to permit the estate of such Limited Partner to acquire REIT Shares
pursuant to Section 2.1.A or cash pursuant to Section 2.1.B that could be
utilized to fund the payment of any estate taxes that may be payable at such
time.
E. The Exchange Right shall expire with respect to any OP Units for
which an Exchange Notice has not been delivered to the Company and to the
Operating Partnership on or before December 31, 2094.
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F. Any exchange of OP Units pursuant to this Article 2 shall be
deemed to have occurred as of the Specified Exchange Date for all purposes,
including without limitation the payment of distributions or dividends in
respect of OP Units or REIT shares, as applicable. Any OP Units acquired by the
Operating Partnership pursuant to an exercise by any Limited Partner of an
Exchange Right shall be deemed to be acquired by and reallocated or reissued to
the Operating Partnership. The Company, as general partner of the Operating
Partnership, shall amend the Partnership Agreement to reflect each such exchange
and reallocation or reissuance of OP Units and each corresponding recalculation
of the OP Units of the Limited Partners. The number of OP Units to be
reallocated or reissued to the Operating Partnership shall equal the number of
REIT Shares issued to a Limited Partner upon exercise of an Exchange Right.
G. Except in connection with a merger, business combination or other
reorganization transaction, the Company shall not exchange any of its OP Units
as long as there are any other holders of OP Units.
ARTICLE 3
OTHER PROVISIONS
Section 3.1 Covenants of the Company.
A. At all times during the pendency of the Exchange Right, the
Company shall reserve for issuance such number of REIT Shares as may be
necessary to enable the Company to issue such shares in full payment of the REIT
Shares Amount in regard to all OP Units held by Limited Partners which are from
time to time outstanding.
B. During the pendency of the Exchange Right, the Company shall
deliver to Limited Partners in a timely manner all reports filed by the Company
with the SEC to the extent the Company also transmits such reports to its
shareholders and all other communications transmitted from time to time by the
Company to its shareholders generally.
C. The Company shall notify each Limited Partner, upon request, of
the then current Exchange Factor.
Section 3.2 Fractional Shares.
No fractional REIT Shares shall be issued upon exchange of OP Units.
The number of full shares of REIT Shares which shall be issuable upon exchange
of OP Units (or the cash equivalent amount thereof if the Cash Amount is paid)
shall be computed on the basis of the aggregate amount of OP Units so
surrendered. Instead of any fractional REIT Shares which would otherwise be
issuable upon exchange of any OP Units, the Company shall pay a cash adjustment
in respect of such fraction in an amount equal to the Cash Amount of an OP Unit
multiplied by such fraction.
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ARTICLE 4
GENERAL PROVISIONS
Section 4.1 Addresses and Notice.
Any notice, demand, request or report required or permitted to be
given or made to a Limited Partner or Assignee under this Agreement shill be in
writing and shall be deemed given or made when delivered in person or when sent
by first class United States mail or by other means of written communication to
the Limited Partner or Assignee at the address listed on the records of the
Partnership. Notice to the Company shall be made to the following address:
27600 Northwestern Highway, Suite 200, Southfield, Michigan 48036, Attn:
Chairman.
Section 4.2 Titles and Captions.
All article or section titles or captions in this Agreement are for
convenience only. They shall not be deemed part of this Agreement and in no way
define, limit, extend or describe the scope or intent of any provisions hereof.
Except as specifically provided otherwise, references to "Articles" and
"Sections" are to Articles and Sections of this Agreement.
Section 4.3 Pronouns and Plurals.
Whenever the context may require, any pronoun used in this Agreement
shall include the corresponding masculine, feminine or neuter forms, and the
singular form of nouns, pronouns and verbs shall include the plural and vice
versa.
Section 4.4 Further Action.
The parties shall execute and deliver all documents, provide all
information and take or refrain from taking action as may be necessary or
appropriate to achieve the purposes of this Agreement.
Section 4.5 Binding Effect.
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their heirs, executors, administrators, successors, legal
representatives and permitted assigns.
Section 4.6 Waiver.
No failure by any party to insist upon the strict performance of any
covenant, duty, agreement or condition of this Agreement or to exercise any
right or remedy
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consequent upon a breach thereof shall constitute waiver of any such breach or
any other covenant, duty, agreement or condition.
Section 4.7 Counterparts.
This Agreement may be executed in counterparts, all of which together
shall constitute one agreement binding on all of the parties hereto,
notwithstanding that all such parties are not signatories to the original or the
same counterpart. Each party shall become bound by this Agreement immediately
upon affixing its signature hereto.
Section 4.8 Applicable Law.
This Agreement shall be construed and enforced in accordance with and
governed by the laws of the State of Delaware, without regard to the principles
of conflicts of laws thereof.
Section 4.9 Invalidity of Provisions.
If any provision of this Agreement is or becomes invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein shall not be affected thereby.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement or
caused this Agreement to be executed as of the day and year first above written.
RAMCO-GERSHENSON PROPERTIES TRUST
By: /s/ Dennis Gershenson
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Name: Dennis Gershenson
Title: Chief Executive Officer
WEST OAKS I
WEST OAKS DEVELOPMENT COMPANY,
a Michigan co-partnership
By: /s/ Dennis Gershenson
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Dennis Gershenson, Partner
JACKSON CROSSING
RAMCO JACKSON ASSOCIATES LIMITED
PARTNERSHIP,
a Michigan limited partnership
By: RAMCO JACKSON, INC.,
a Michigan corporation,
its General Partner
By: /s/ Dennis Gershenson
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Dennis Gershenson
Vice President
SOUTHFIELD PLAZA + S-12
SOUTHFIELD PLAZA LIMITED PARTNERSHIP,
a Michigan limited partnership
By: RAMCO VENTURES,
a Michigan co-partnership,
its General Partner
By: /s/ Dennis Gershenson
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Dennis Gershenson, Partner
(signature pages continued)
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ROSEVILLE PLAZA
ROSEVILLE PLAZA LIMITED PARTNERSHIP,
a Michigan limited partnership
By: RAMCO VENTURES, a Michigan
co-partnership, its General Partner
By: /s/ Dennis Gershenson
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Dennis Gershenson, Partner
TEL-TWELVE SHOPPING CENTER
TEL-TWELVE MALL ASSOCIATES
LIMITED PARTNERSHIP,
a Michigan limited partnership
By: R.G. TEL-TWELVE CO.,
a Michigan co-partnership,
its General Partner
By: /s/ Dennis Gershenson
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Dennis Gershenson, Partner
CLINTON VALLEY MALL
STERLING MALL ASSOCIATES
LIMITED PARTNERSHIP,
a Michigan limited partnership
By: RAMCO CONSUMERS MALL ASSOCIATES
LIMITED PARTNERSHIP, a Michigan limited
partnership, its General Partner
By: /s/ Dennis Gershenson
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Dennis Gershenson, a General Partner
(signature pages continued)
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EASTRIDGE COMMONS
RAMCO LAPEER ASSOCIATES LIMITED
PARTNERSHIP, a Michigan limited partnership
By: RAMCO LAPEER, INC., a Michigan
corporation, its General Partner
By: /s/ Dennis Gershenson
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Dennis Gershenson,
Vice President
NEW TOWNE PLAZA
FORD SHELDON PLAZA COMPANY,
a Michigan limited partnership
By: /s/ Dennis Gershenson
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Dennis Gershenson,
a General Partner
LAKE ORION PLAZA
W & G REALTY COMPANY,
a Michigan co-partnership
By: /s/ Dennis Gershenson
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Dennis Gershenson, Partner
OAK BROOK SQUARE
RAMCO OAK BROOK SQUARE ASSOCIATES
LIMITED PARTNERSHIP,
a Michigan limited partnership
By: RAMCO OAK BROOK SQUARE, INC.,
a Michigan corporation, general partner
By: /s/ Dennis Gershenson
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Dennis Gershenson, Vice President
(signature pages continued)
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FRASER TOWN CENTER
RAMCO FRASER DEVELOPMENT COMPANY,
a Michigan co-partnership
By: /s/ Dennis Gershenson
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Dennis Gershenson, Partner
EDGEWOOD TOWN CENTER
RAMCO LANSING ASSOCIATES,
a Michigan co-partnership
By: /s/ Dennis Gershenson
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Dennis Gershenson, Partner
NORTH TOWNE OFFICE MAX
RAMCO LEWIS ALEXIS ASSOCIATES,
a Michigan partnership
By: /s/ Dennis Gershenson
---------------------------------
Dennis Gershenson, Partner
NAPLES TOWNE CENTER
RAMCO SOUTH NAPLES DEVELOPMENT,
a Florida general partnership
By: /s/ Dennis Gershenson
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Dennis Gershenson, Partner
(signature pages continued)
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SPRING MEADOWS SHOPPING CENTER
RAMCO SPRING MEADOWS ASSOCIATES,
a Michigan co-partnership
By: /s/ Dennis Gershenson
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Dennis Gershenson, Partner
and
JCP REALTY, INC.,
a Delaware corporation
By: /s/ Philip O'Connell
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Philip O'Connell
Its: Vice President
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TROY TOWNE CENTER
RAMCO SINGER ASSOCIATES LIMITED
PARTNERSHIP, an Ohio limited partnership
By: RAMCO TROY ASSOCIATES,
a Michigan co-partnership,
its General Partner
By: /s/ Dennis Gershenson
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Dennis Gershenson, Partner
WEST ALLIS TOWN CENTER
WEST ALLIS SHOPPING CENTER ASSOCIATES,
a Wisconsin general partnership
By: RAMCO ALLIS DEVELOPMENT COMPANY,
its Partner
By: /s/ Dennis Gershenson
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Dennis Gershenson, Partner
(signature pages continued)
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FERNDALE PLAZA
MICHIGAN SHOPPING CENTER VENTURE II
LIMITED PARTNERSHIP,
a Michigan limited partnership
By: RAMCO L & W PARTNERS,
a Michigan co-partnership, its general
partner
By: RAMCO GP,
a Michigan co-partnership, Partner
By: /s/ Dennis Gershenson
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Dennis Gershenson, Partner
WEST OAKS II
RAMCO NOVI DEVELOPMENT ASSOCIATES
LIMITED PARTNERSHIP,
a Michigan co-partnership
By: RAMCO NOVI DEVELOPMENT COMPANY,
a Michigan co-partnership,
its General Partner
By: /s/ Dennis Gershenson
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Dennis Gershenson, Partner
CLINTON VALLEY STRIP
KMW STERLING DEVELOPMENT COMPANY,
a Michigan co-partnership
By: /s/ Dennis Gershenson
-------------------------------------------
Dennis Gershenson, Partner
(signauture pages continued)
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KENTWOOD TOWNE CENTER
RAMCO KENTWOOD ASSOCIATES,
a Michigan co-partnership
By: /s/ Dennis Gershenson
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Dennis Gershenson, Partner
/s/ Joel Gershenson
----------------------------------------
Joel Gershenson
/s/ Dennis Gershenson
----------------------------------------
Dennis Gershenson
/s/ Richard Gershenson
----------------------------------------
Richard Gershenson
/s/ Bruce Gershenson
----------------------------------------
Bruce Gershenson
MICHAEL A. WARD, TRUSTEE, U/T/A DATED
2/22/77, AS AMENDED
/s/ Michael A. Ward
----------------------------------------
Michael A. Ward, Trustee U/T/A
dated 2/22/77, as amended
(End of signature pages)
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Exhibit A
Tel-Twelve Mall Associates Limited Partnership
Ramco Fraser Development Company
Ramco Lapeer Associates Limited Partnership
Roseville Plaza Limited Partnership
Ramco South Naples Development
Southfield Plaza Limited Partnership
Ramco Singer Associates Limited Partnership
West Allis Shopping Center Associates
Ford Sheldon Plaza Company
Michigan Shopping Center Ventures II Limited Partnership
KMW Sterling Development Company
Ramco Kentwood Associates
Ramco Oak Brook Square Associates Limited Partnership
Sterling Mall Associates Limited Partnership
W & G Realty Company
West Oaks Development Company
Ramco Novi Development Associates Limited Partnership
JCP Realty
Ramco Spring Meadows Associates
Ramco Jackson Associates Limited Partnership
Ramco Lansing Associates
Ramco Lewis Alexis Associates
Joel Gershenson
Dennis Gershenson
Richard Gershenson
Bruce Gershenson
Michael A. Ward, Trustee u/t/a dated 2/22/77, as amended