Amended And Restated Limited Partnership Agreement

EXHIBIT 10.50

AMENDED AND RESTATED

LIMITED PARTNERSHIP AGREEMENT

OF


PRENTISS OFFICE INVESTORS, L.P.

AMENDED AND RESTATED


LIMITED PARTNERSHIP AGREEMENT

OF


PRENTISS OFFICE INVESTORS, L.P.


This Amended and Restated Limited Partnership Agreement (this " Agreement" ) of Prentiss Office Investors, L.P., a Delaware limited partnership (the " Partnership" ), is made to be effective as of January 29, 2004 by and between Prentiss Properties Acquisition Partners, L.P., a Delaware limited partnership (the " General Partner" ), and Stichting Pensioenfonds ABP, a Netherlands foundation (the " Limited Partner" , together with the General Partner; the " Partners" ).


RECITALS AND ASSIGNMENTS :


WHEREAS, the Partnership was formed pursuant to a Limited Partnership Agreement dated as of January 22, 2004 (the " Original Agreement" ) executed by the General Partner and Prentiss Properties Limited, Inc., a Delaware corporation (" PPL" ), and by the filing by the General Partner of a Certificate of Limited Partnership with the Office of the Secretary of State of the State of Delaware on January 22, 2004;


WHEREAS, pursuant to the Original Agreement, the General Partner owns a 51% general partnership interest in the Partnership and a 48.9% limited partnership in the Partnership, and PPL owns a 0.1% limited partnership interest in the Partnership;

WHEREAS, the General Partner does hereby assign to the Limited Partner its entire 48.9% limited partnership interest in the Partnership, and the Limited Partner hereby assumes all of the duties and obligations of the General Partner with respect to such 48.9% limited partnership interest which arise under this Agreement from and after the effective date hereof;

WHEREAS, PPL hereby assigns to the Limited Partner its 0.1% limited partnership interest in the Partnership, and the Limited Partner hereby assumes all of the duties and obligations of PPL relating to such 0.1% limited partnership interest which arise under this Agreement from and after the date hereof; and


WHEREAS, after giving effect to the foregoing assignments, the Limited Partner and the General Partner own the respective Percentage Interests set forth in Section 5.1.5 of this Agreement;


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NOW, THEREFORE, in consideration of the mutual representations, warranties and covenants hereinafter set forth, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree that the Original Agreement is amended and restated in its entirety as follows:

ARTICLE I.

DEFINITIONS

1.1 Definitions . As used herein the following terms have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined):

1.1.1 " Act" shall mean the Delaware Revised Uniform Limited Partnership Act, as amended from time to time.

1.1.2 " Additional Capital Contribution" has the meaning given such term in Section 5.2.1 hereof.


1.1.3 " Affiliate" means, with respect to a specified Person, (a) any Person that directly, or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, the specified Person, or (b) any Person that is an officer, director, trustee or general partner of, or serves in a similar capacity with respect to, the specified Person, or of which the specified Person is an officer, director, trustee or general partner, or with respect to which the specified Person serves in a similar capacity. For purposes of this definition the term " control" when used with respect to a Person means (i) the beneficial ownership (as defined in Rule 13d-3 promulgated under the Securities and Exchange Act of 1934, as amended) of 50% or more of the voting interests in such Person, or (ii) the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by contract or otherwise.


1.1.4 " Affiliate Contract" means any contract or other agreement between the Partnership and any Partner or Affiliate of such Partner.

1.1.5 " Affiliated Person" means any Person (other than the Partnership) composed of the General Partner and/or its Affiliates and the Limited Partner and/or its Affiliates.


1.1.6 " Agreed Purchase Price" means the purchase price that a third party has agreed to pay to purchase a Property and that has been Approved by Partners.

1.1.7 " Agreement" means this Limited Partnership Agreement, as amended, modified, supplemented or restated from time to time.

1.1.8 " Approval" or " Approve" means the prior consent or prior written authorization by a Partner or its representatives hereunder to any decision or action taken or to be taken by the Partnership. Unless otherwise expressly provided herein, when the term " Approval" or " Approve" (or any variation thereof) is used herein, such Approval shall not be unreasonably withheld, conditioned or delayed by a Partner.

1.1.9 " Approval of Partners" means an Approval of all of the Non-Defaulting Partners at such time; provided, however, that if the Limited Partner transfers a portion of its Percentage Interest in accordance with Article XI, the " Approval of Partners" means the Approval of the Non-Defaulting Partners at such time that own 75% or more of the Percentage Interests.


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1.1.10 " Arbitration Procedure" means the arbitration procedure set forth in Article XII hereof.


1.1.11 " Auditors" means PricewaterhouseCoopers, LLP, or such other national accounting firm as may be auditing the General Partner' s financial statements from time to time.

1.1.12 " Available Cash" means, with respect to any fiscal period of the Partnership, the excess of all cash receipts of the Partnership during such period over the sum of (a) all cash disbursements and expenditures paid or reserved for payment by the Partnership to defray expenses, costs, and indebtedness of the Partnership accrued during such period (including all fees and expenses paid or reserved for payment to the Partners), (b) all funds required for capital improvements (including tenant improvements and certain leasing concessions), but only to the extent that any unfunded portion of the Commitments is not sufficient to fully fund such capital improvements, (c) a reasonable allowance for cash reserves for repairs, replacements, contingencies, working capital and anticipated obligations as determined by the General Partner to be necessary to meet Partnership obligations for the next fiscal quarter or quarters and as Approved by the Limited Partner to the extent such reserves are not within the limits set forth in the applicable Business Plan and (d) such other sums as the Partners shall Approve for retention in the Partnership. If the General Partner determines that the reserves of the Partnership are in excess of the amount required for the Partnership' s operations, such reserves may be reduced by such excess and such excess shall thereupon be included in the amount of Available Cash available for distribution hereunder.


1.1.13 " Budget" has the meaning given such term in Section 8.4.1 hereof.


1.1.14 " Business Plan" means a business plan for each Property prepared pursuant to and in accordance with Section 8.4.1 hereof.


1.1.15 " Business Scope" has the meaning given such term in Section 2.3 hereof.

1.1.16 " Capital Account" has the meaning given such term in Section 7.2.1 hereof.


1.1.17 " Capital Contribution" means a capital contribution made by a Partner pursuant to Articles IV and V hereof. Only cash contributions which increase a Partner' s Capital Account shall be considered a Capital Contribution.

1.1.18 " Capital Loan" has the meaning given such term in Section 5.2.7 hereof.


1.1.19 " Certificate" has the meaning given to such term in the Recitals.


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1.1.20 " Code" means the Internal Revenue Code of 1986, as amended, or corresponding provisions of future laws.


1.1.21 " Commitments" has the meaning given to such term in Section 5.1.7.


1.1.22 " Control" or " Controlled by" or " Controlling" or any derivative thereof, when used with respect to any specified Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through ownership of voting securities or other ownership interests, or by contract; provided , however , that, without limiting the generality of the foregoing, (a) any Person which, together with its Affiliates, owns, directly or indirectly, securities representing more than 50% of the value or ordinary voting power of a corporation or more than 50% of the partnership, general partnership, Partnership or other ownership interests (based upon value or vote) of any other Person is deemed to Control such corporation or other Person, (b) a general partner shall always be deemed to Control any partnership of which it is a general partner, and (c) a managing Partner or manager of a limited liability company shall always be deemed to Control any limited liability company of which it is a managing Partner or manager.

1.1.23 " Core Properties" has the meaning set forth on Exhibit A , as such meaning may be amended from time to time with the Approval of Partners.


1.1.24 " Deadlock" has the meaning set forth in Section 8.7.


1.1.25 " Deadlock Notice" has the meaning set forth in Section 8.7.


1.1.26 " Delinquent Partner" has the meaning given to such term in Section 5.2.2.


1.1.27 " Disposition" means any sale, master lease, installment sale, sale-leaseback, condominium or cooperative conversion, convertible mortgage financing or other transfer of all or a substantial portion of a Property or the related REIT Owner' s ownership interest therein.


1.1.28 " Dissolution" means dissolution of the Partnership pursuant to Section 13.1 hereof.


1.1.29 " Distribution Share" means, with respect to any sale of a Property by the related REIT Owner and with respect to each Partner, the amount that such Partner would be entitled to receive if the REIT Owner sold the Property for the Agreed Purchase Price on the projected date of closing and the Company immediately paid all Partnership expenses and other liabilities relating to such Property (including, without limitation, closing costs incurred or to be incurred in connection with such sale) and then distributed the net proceeds of the sale to the Partners in accordance with Section 6.1.


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1.1.30 " Event of Default" means the occurrence of any of the following events:

(a) any material representation or warranty made by a Partner in this Agreement that was false or misleading in any material respect as of the date of this Agreement;

(b) a Partner shall fail to (i) make a Capital Contribution pursuant to Article V and such failure shall continue for 5 days after Notice thereof shall have been given to such Partner by any other Partner, or (ii) perform or observe any other material covenant or agreement contained in this Agreement to be performed or observed by such Partner, which failure shall remain unremedied for 30 days after Notice thereof shall have been given to such Partner by any other Partner;

(c) the transfer of an Interest by such Partner in violation of the restrictions on transfer set forth in Article XI hereof, except for transfers by operation of law;


(d) a Partner shall become insolvent, generally shall fail or be unable to pay its debts as they mature, shall admit in writing its inability to pay its debts as they mature, shall make a general assignment for the benefit of creditors, shall enter into any composition or similar agreement with creditors, or shall suspend the transaction of all or a substantial portion of its usual business as a result of its insolvency or general failure or inability to pay its debts as they mature;

(e) a Partner shall file a petition or answer or consent seeking relief under Title 11 of the United States Bankruptcy Code, as now constituted or hereafter amended, or any other applicable federal, state or foreign bankruptcy law or other similar law, or a Partner shall consent to the institution of proceedings thereunder or the filing of any such petition or to the appointment of a receiver, liquidator, assignee, trustee, custodian, sequestrator or similar official to take possession of any substantial part of a Partner' s properties;


(f) there shall be entered a decree or order by a court constituting an order for relief in respect of a Partner under Title 11 of the United States Bankruptcy Code, as now constituted or hereafter amended, or any other applicable federal, state or foreign bankruptcy law or other similar law, or appointing a trustee, custodian, sequestrator or similar official to take possession of any substantial part of a Partner' s properties, or ordering the winding-up of or liquidation of the affairs of the Partner, and any such decree or order shall continue unstayed and in effect for a period of 60 consecutive days;


(g) the withdrawal from the Partnership by such Partner, except as permitted under the terms of this Agreement;

(h) the failure of a Partner to make an Additional Capital Contribution to which it has given its Approval pursuant to Section 5.2.1;


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(i) a Partner, a Key Executive or a Successor Key Executive has misappropriated Partnership funds or has engaged in fraudulent, willful or grossly negligent conduct with respect to the Partnership or its assets; provided , however , that if the misappropriation, fraudulent or grossly negligent conduct was committed (i) by a Partner and not a Key Executive or a Successor Key Executive and (b) without the actual prior knowledge by any Key Executive or Successor Key Executive, such conduct may be cured by the Partner committing such wrongful act if, within 30 days following Partner' s knowledge of such wrongful act, such Partner makes full restitution to the Partnership of all damages caused by such conduct, terminates the employment of the employee of the Partner who committed such wrongful conduct (except in the case of grossly negligent conduct committed by such employee where the curing Partner reasonably believes that termination is not justified under the circumstances) and thereafter takes all appropriate actions necessary to remediate the situation and protect the interests of the Partnership; or


(j) a Partner has, as a result of the occurrence of any of the events described above (and without regard to whether or not such Partner has cured any related breach), caused an event of default (following expiration of applicable cure period(s)) by the Partnership to occur under any agreement with a lender to the Partnership or any REIT Owner or under any other material agreement to which the Partnership is a party; provided , however , that in no event shall the failure by any Partner to meet a financial covenant or any other covenant beyond such Partner' s reasonable control in any such agreement constitute an Event of Default.

1.1.31 " FMV Price" has the meaning set forth in Section 20.5.


1.1.32 " Forced Sale Procedure" means the forced sale procedure set forth in Article XV.


1.1.33 " GAAP" means generally accepted accounting principles of the Accounting Principles Board of the American Institute of Certified Public Accountants and the Financial Accounting Standards Board that are applicable from time to time.

1.1.34 " General Partner" has the meaning set forth in the preamble.


1.1.35 " General Partner Commitment" has the meaning set forth in Section 5.1.7.


1.1.36 " Indemnified Party(ies)" has the meaning set forth in Section 9.2.1.


1.1.37 " Interest" or " Partnership Interest" means, when used with reference to any Partner, the entire ownership interest or allocated share of such Partner in Profits, Losses, tax credits, Available Cash and other Partnership assets, liabilities and distributions, and all other rights and obligations of such Partner under the terms and provisions of this Agreement and the Act.


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1.1.38 " Investment Criteria" means the investment criteria set forth on Exhibit B , as such criteria may be amended from time to time with the Approval of Partners.


1.1.39 " Investment Term" means the period commencing on the date of this Agreement and ending on the eighteen month anniversary thereof; provided , however , that the General Partner and the Limited Partner may mutually agree in writing to extend such term for two additional six (6) month periods.

1.1.40 " Key Executives" has the meaning given to such term in Section 17.1 hereof.


1.1.41 " Leasing Fee" means the fee to be paid to the Manager pursuant to the Management Agreement for the leasing services provided pursuant thereto.


1.1.42 " Limited Partner" has the meaning set forth in the preamble.


1.1.43 " Limited Partner Commitment" has the meaning set forth in Section 5.1.7.

1.1.44 " Major Decision" has the meaning given such term in Section 8.2 hereof.


1.1.45 " Management Agreement" means the management and leasing agreement to be executed between a REIT Owner and Manager substantially in the form of Exhibit D .


1.1.46 " Management Fee" means the fee to be paid Manager pursuant to the Management Agreement for the management services provided by Manager pursuant thereto.


1.1.47 " Manager" means Prentiss Properties Management, L.P., a Texas limited partnership.

1.1.48 " Non-Defaulting Partner" means a Partner with respect to whom an Event of Default has not occurred.


1.1.49 " Non-Delinquent Partner" has the meaning given to such term in Section 5.2.2.


1.1.50 " Non-Exclusive Properties" means those properties located at 321 N. Clark, Chicago, Illinois and in Northern California which the General Partner is considering purchasing with an existing tenant of such property. It is contemplated that General Partner' s interest in the entity which may acquire the property located in Northern California will be 20% or less.


1.1.51 " Non-Qualifying Property" means any real property and improvements thereon that is not a Qualifying Property.


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1.1.52 " Notice" shall mean a written communication given in accordance with the provisions of Section 16.3 hereof.


1.1.53 " Notice Partner" has the meaning given such term in Section 7.9.1 hereof.


1.1.54 " Partners" means the General Partner and the Limited Partner, or any substitutes, replacements or permitted transferees hereunder for either the General Partner or the Limited Partner.

1.1.55 " Partnership" has the meaning set forth in the preamble.


1.1.56 " Percentage Interest" has the meaning set forth in Section 5.1.5. Reference to a majority or a specified percentage in Interest of the Partners shall mean Partners whose Interests represent a majority or such specified percentage, respectively, of the Percentage Interests of all of the Partners.


1.1.57 " Performance Standard" has the meaning set forth in Section 8.1.


1.1.58 " Permitted Investments" means


(a) direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States of America), in each case maturing within one year from the date of acquisition thereof;

(b) investments in commercial paper maturing within 365 days from the date of acquisition thereof and having, at such date of acquisition, the highest credit rating obtainable from Standard & Poor' s Ratings Group or Moody' s Investors Service, Inc.;

(c) investments in certificates of deposit, banker' s acceptances and time deposits maturing within 365 days from the date of acquisition thereof issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, any domestic office of any commercial bank organized under the laws of the United States of America or any State thereof which has a combined capital and surplus and undivided profits of not less than $500 million and has at least an A credit rating from Standard & Poor' s Ratings Group or an A2 credit rating from Moody' s Investors Service, Inc.; and

(d) fully collateralized repurchase agreements with a term of not more than 30 days for securities described in clause (a) of this definition and entered into with a financial institution satisfying the criteria described in clause (c) of this definition.

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1.1.59 " Person" means any individual, partnership, corporation, trust or other entity, or any government or political subdivision, or any agency, department or instrumentality thereof.


1.1.60 " PPT" means Prentiss Properties Trust, a Maryland real estate investment trust.

1.1.61 " Preferred Return" means a return on any Partner' s Unreturned Capital Contribution of ten percent (10%) per annum, compounded on the first day of each calendar year and earned from the date on which each Capital Contribution is funded until the date it is fully returned by distributions of cash or other assets (including stock in a REIT Owner) pursuant to Section 6.1(c) or Section 13.2.1(d) hereof. For purposes of calculating the Preferred Return, each distribution by the Partnership to such Partner shall be credited first in payment of the Preferred Return accrued on the balance of such Partner' s Unreturned Capital Contribution as of the date of such distribution and second in return of such Unreturned Capital Contribution.

1.1.62 " Prime Rate" means the prime rate as reported by the Wall Street Journal in the Money Rates section, on the date the advance, contribution, investment or payment in question is made, or if the Wall Street Journal does not publish a prime rate, Prime Rate shall be the average of the prime rates publicly announced by the five largest national banks in the United States.


1.1.63 " Profits" or " Losses" mean, respectively, for any Partnership fiscal period, the net income or losses recognized by the Partnership for purposes of determining Capital Accounts under Section 7.2 for such period, including, without limitation, each item of Partnership income, gain, loss or deduction, including capital gains and capital losses.


1.1.64 " Promote Payments" means, with respect to each Partner, the payments to which such Partner is entitled to receive pursuant to Section 6.1(e).


1.1.65 " Property" means a Qualifying Property or a Non-Qualifying Property acquired by the Partnership pursuant to Section 5.1.2.


1.1.66 " PSA" has the meaning given to such term in Section 5.1.1.


1.1.67 " Purchase Price" has the meaning given to such term in Section 5.1.2.


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1.1.68 " Qualified Institutional Investor" means, for purposes of Section 11.1 hereof: (a) a pension fund, pension trust or pension account that has total real estate assets of at least $1 billion, at least $100 million of which shall be office properties; (b) a pension fund advisor who, immediately prior to such transfer, controls at least $1 billion of real estate assets, at least $100 million of which shall be office properties; or (c) any other Person with a net worth (or comparable measurement of equity value) of at least $500 million, and which, immediately prior to a transfer, controls real estate equity assets of at least $1 billion, at least $100 million of which shall be office properties.

1.1.69 " Qualifying Property" has the meaning given to such term in Section 5.1.1.


1.1.70 " Regulations" means the U.S. Treasury regulations promulgated under the Code, as such U.S. Treasury regulations shall be in effect from time to time.


1.1.71 " REIT Owner" means a trust or other entity to be formed pursuant to Section 5.1.2 to own a Property.

1.1.72 " Responding Partner" has the meaning set forth in Section 15.1.


1.1.73 " Response Date" has the meaning set forth in Section 15.3.

1.1.74 " Successor Key Executive" has the meaning given to such term in Section 17.1 hereof.


1.1.75 " Target Markets" means the geographic areas (including suburbs) of Washington, D.C., Northern Virginia, Chicago, Illinois, Dallas/Fort Worth, Texas, San Diego, California, Orange County, California, Northern California (including East Bay, San Francisco and Silicon Valley) and such other geographic areas as may be determined with the Approval of Partners.


1.1.76 " Tax Matters Partner" has the meaning given such term in Section 7.9.1 hereof.

1.1.77 " Taxable Income" or " Taxable Loss" means, respectively, and for any calendar quarter, calendar year or other fiscal period applicable to the Partnership, the income or losses recognized by the Partnership for U.S. federal income tax purposes for such period, including without limitation, each item of Partnership income, gain, loss or deduction, including capital gains and capital losses.


1.1.78 " Term" has the meaning set forth in Section 2.6.


1.1.79 " Transaction" has the meaning set forth in Section 16.13(b).


1.1.80 " Unreturned Capital Contribution" as of any date shall mean the aggregate Capital Contributions made by a Partner through such date pursuant to Section 4.8 and Article V, minus distributions of cash or other assets (including stock in a REIT Owner) made to such Partner through such date pursuant to Section 6.1(d) hereof and Section 13.2.1(d).


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1.1.81 " Value-Added Properties" has the meaning set forth in Exhibit A , as such meaning may be amended from time to time with the Approval of Partners.


ARTICLE II.


FORMATION, PURPOSES AND DURATION


2.1 Formation . The Partnership has been formed through the filing of the Certificate by the General Partner under the Act. The parties hereto are entering into this Agreement in order to complete and perfect the organization of the Partnership and to provide for the conduct of its business. Except as expressly provided herein to the contrary, the rights and obligations of the Partners and the administration and termination of the Partnership shall be governed by the Act.

2.2 Name . The name of the Partnership shall be " Prentiss Office Investors, L.P." . The business of the Partnership shall be conducted under the name of " Prentiss Office Investors, L.P." or such other name as the General Partner may from time to time determine, provided that such other name may not in any way reference the identity Stichting Pensioenfonds ABP. The General Partner shall give prompt notice to the Limited Partner of any change in the name of the Partnership and shall not identify the Limited Partner in any such name change without the Limited Partner' s Approval.


2.3 Purposes and Business . The sole and only purpose and business of the Partnership is: (a) to acquire, own, deal with and dispose of ownership interests in the REIT Owners, which REIT Owners shall acquire, own, lease, operate, manage and sell the Properties, in each case as more fully described in and subject to the applicable limitations, restrictions and other provisions of this Agreement, as an investment for the production of income and profit; (b) to engage in such other activities as are reasonably necessary or appropriate to effectuate the foregoing; and (c) to engage in such other business with the Approval of Partners (the " Business Scope" ).


2.4 Place of Business . The principal office and place of business of the Partnership shall be located at 3890 West Northwest Hwy., Suite 400, Dallas, Texas 75220, or at such other place as the General Partner may from time to time designate by Notice given to the Limited Partner, provided that the Partnership shall not have its place of business in any jurisdiction which would require the Limited Partner to file a local tax return in such jurisdiction solely as a result of (a) such Limited Partner' s ownership of its Interest and (b) the Partnership having its home office in that jurisdiction.


2.5 Title to Partnership Property . Legal title to each Property shall be o ...