US GOVERNMENT BUILDING OPEN-END FEEDER 1 LPUS GOVERNMENT BUILDING OPEN -END FEEDER 1, LP
USAA REAL ESTATE COMPANY
9830 Colonnade Boulevard, Suite 600
San Antonio, TX 78230 -2239
May 18, 2015
City of Clearwater
Employees' Pension Fund
P.O. Box 4748
Clearwater, FL 33758 -4748
Re: $10,000,000 Investment in US Government Building Open -End Feeder 1, LP (the
"Partnership ")
Ladies and Gentlemen:
This letter agreement (this "Letter Agreement ") confirms our understanding with
respect to certain matters relating to an investment by the City of Clearwater Employees'
Pension Fund (the "Investor ") in the Partnership. Capitalized terms used in this Letter
Agreement and not otherwise defined herein shall have the respective meanings ascribed
to them in the Amended and Restated Limited Partnership Agreement of the Partnership
dated December 18, 2014 (as amended from time to time, the "Partnership
Agreement ") or the Subscription Agreement ( "Subscription Agreement ") dated May
18, 2015, as applicable. In consideration of the Capital Commitment made by the
Investor, the Investor and the General Partner, individually and on behalf of the
Partnership, agree as follows:
1. Initial Disclosure of Terms Agreements. On or before the date that is 60 days
following the execution and delivery of this Letter Agreement , the Partnership
and the General Partner shall (a) disclose to the Investor in writing the material
terms of each side letter or similar agreement, subscription agreement and limited
partnership agreement or limited liability company agreement and any
amendments to any of the foregoing (each, a "Terms Agreement ") entered into
on or prior to the date hereof by the General Partner, the Partnership, the Fund
Manager, each other Feeder or Feeder Fund, any Parallel Fund, or the general
partner or investment manager of any of them (each, an "MFN Person ") that then
remains in effect, with any investor (an "Equivalent Investor ") whose Aggregate
Committed Investment is equal to or less than the combined total Aggregate
Committed Investment of the Investor and, except as provided in paragraph 3,
shall offer to the Investor the opportunity to elect, by written notice to the General
Partner within 30 days after such disclosure, to include such terms in this Letter
Agreement and thereby make such terms applicable to the Investor's interest in
the Partnership.
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"Aggregate Committed Investment" means, with respect to any Person, their
Capital Commitment to the Partnership, any other Feeder, any Feeder Fund or any
Parallel Fund.
2. Right to Elect Additional Terms. If, at any time on or after the date on which
disclosure would be required by paragraph 1, any MFN Person enters into any
Terms Agreement with an Equivalent Investor containing terms that are more
favorable in any material respect to the such Equivalent Investor than the rights
granted to the Investor pursuant to this Letter Agreement, then, except as provided
in paragraph 3, the General Partner shall (i) promptly disclose such terms to the
Investor in writing and (ii) offer to the Investor the opportunity to elect to include
such terms in this Letter Agreement and thereby make such terms applicable to
the Investor's interest in the Partnership by written notice to the General Partner
within 30 days after such disclosure under this paragraph 2.
3. Limitation on Investor's Rights. The Investor's rights under paragraphs 1 and 2
shall not apply to (i) terms of other Feeders, Feeder Funds, and Parallel Funds that
are attributable to the differences in the tax or regulatory compliance objectives
between the Partnership and such other Feeder, Feeder Fund, or Parallel Fund, (ii)
rights to make future capital contributions, (iii) agreements regarding Advisory
Committee membership, (iv) terms attributable to any Limited Partner that is
Sponsor Affiliate or an employee or direct or indirect investor in a Sponsor
Affiliate, (v) agreements relating to tax, regulatory or other legal issues that are
applicable to particular investors or types of investors and not to the Investor, (vi)
agreements with Existing Investors and (vi) agreements relating to the settlement
of bona fide disputes or defaults. The Investor may not elect particular economic
terms or benefits made available to an Equivalent Investor unless the Investor
elects the entire collection of economic terms applicable to the Equivalent
Investor and forgoes any economic terms otherwise available to the Investor,
including without limitation, those set forth in this Letter Agreement. "Existing
Investor" means each member (or affiliate thereof) of US Government Building
Fund, LLC, a Delaware limited liability company, prior to July 1, 2012.
4. Representations and Warranties of the General Partner. The General Partner
represents and warrants to the Investor as of the date hereof as follows:
a. The Partnership is a limited partnership duly formed, validly existing and
in good standing under the Act, and has the partnership power and
authority to execute and deliver the Investor's Subscription Agreement
and this Letter Agreement. The General Partner is a limited liability
company duly formed, validly existing and in good standing under the
Delaware Limited Liability Company Act, and has the power and
authority to execute and deliver the Partnership Agreement, this Letter
Agreement and to perform its obligations thereunder. Each of the
Partnership and the General Partner is duly qualified under the laws of
each jurisdiction where its ownership, lease or operation of property or the
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conduct of its business requires such qualification, except where the
failure to so qualify would not have a material adverse effect on its
activities or properties.
b. To the knowledge of the General Partner, the execution, delivery and
performance of each of the Partnership Agreement, the Investor's
Subscription Agreement, this Letter Agreement or any agreement related
thereto by the General Partner of its obligations thereunder do not result in
the breach of any agreement to which the General Partner is a party;
c. The General Partner has full authority to enter into this Letter Agreement
on behalf of itself and the Partnership, and this Letter Agreement is
enforceable in accordance with its terms, except as may be limited by
bankruptcy, insolvency, moratorium, or other similar law affecting the
enforcement of creditor's rights generally and general principles of equity,
and is and shall be enforceable against any future general partner of the
Partnership;
d. To the knowledge of the General Partner, that neither the execution and
delivery of, nor performance of the obligations under, the Partnership
Agreement, the Subscription Agreement, this Letter Agreement or the
Management Agreement, as applicable, by the General Partner materially
violates any statute, regulation, order, writ, injunction, judgment or decree
to which the General Partner is subject; and
e. There is no legal action, suit or arbitration or other legal, administrative or
governmental investigation, proceeding or inquiry pending, or to the
knowledge of the General Partner, threatened against the properties or
assets of the General Partner or the Partnership , that might reasonably be
expected to have a material adverse affect on the Partnership or the
General Partner's ability to perform its obligations with respect to the
Partnership.
5. Insurance. Throughout the term of this Letter Agreement, the General Partner
shall cause the Partnership to maintain or cause to be maintained in full force and
effect the following insurance covering its activities, the activities of the General
Partner on its behalf, and the activities of the Advisory Board (i) errors and
omissions /professional liability insurance with coverage limits of at least
$5,000,000; and (ii) crime coverage insurance with coverage limits of at least
$10,000,000; provided, in each case, that such insurance coverage is available on
commercially reasonable terms. The General Partner shall use its commercially
reasonable efforts to provide prompt written notice to the Investor of any material
reduction in the coverage limits or insurance providers described in (i) or (ii)
above.
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6. Florida - Specific Provisions.
a. Public Entity Crimes Notice. The Investor represents to the General
Partner, and the General Partner acknowledges, that a person or affiliate
who has been placed on the State of Florida Convicted Vendor List (the
"Convicted Vendor List "), following a conviction for a public entity
crime, may not (i) submit a bid on a contract to provide any goods or
services to a public entity, (ii) submit a bid on a contract with a public
entity for the construction or repair of a public building or public work,
(iii) submit bids on leases of real property to a public entity, (iv) be
awarded or perform work as a contractor, supplier, sub - consultant, or
consultant under a contract with any public entity, and (v) transact
business with any public entity, in excess of $25,000.00, for a period of
thirty -six (36) months from the date of being placed on the Convicted
Vendor List.
b. Non - Discrimination Policy. The General Partner represents and warrants
to the Investor that the General Partner has adopted and will maintain a
policy of non discrimination against employees or applicants for
employment on account of race, religion, sex, color, national origin, age or
handicap, in all areas of employment relations, throughout the term of this
Letter Agreement.
7. Miscellaneous.
a. Entire Agreement. This Letter Agreement, together with the Subscription
Agreement and the Partnership Agreement, constitute the entire agreement
among the parties hereto with respect to the subject matter hereof or
thereof, and supersede any prior agreement or understanding among the
parties hereto with respect to the subject matter hereof or thereof. In the
event of a conflict between the provisions of this Letter Agreement, the
Subscription Agreement and the Partnership Agreement, the provisions of
this Letter Agreement shall, to the fullest extent of applicable law, control.
This Letter Agreement shall survive delivery of fully executed originals of
the Partnership Agreement and Subscription Agreement, and the
Investor's admission to the Partnership as a limited partner.
b. Severability. In case any one or more of the provisions contained in this
Letter Agreement or any application thereof shall be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of
the remaining provisions contained herein and other application thereof
shall not in any way be affected or impaired thereby.
c. Amendments and Waivers. This Letter Agreement may not be modified
or amended or the rights of any party hereunder waived unless such
modification, amendment or waiver is effected by a written instrument
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expressly modifying, amending or waiving this Letter Agreement or the
rights of a party hereunder, which instrument is executed by all parties.
d. Third -Party Rights. Nothing in this Letter Agreement shall be deemed to
create any right in any person not a party hereto (other than the permitted
successors and assigns of a party hereto) and this Letter Agreement shall
not be construed in any respect to be a contract in whole or in part for the
benefit of any third party (except as aforesaid).
e. Notices. Any notices required hereunder shall be in writing and shall be
given in accordance with the provisions of the Partnership Agreement.
f. Successors; Effectiveness. This Letter Agreement will be binding upon,
and inure to the benefit of, the respective permitted successors, assigns
and transferees of the parties hereto. This Letter Agreement shall remain
in effect only for so long as the Investor remains a Limited Partner of the
Partnership and is not default of its obligations under the Partnership
Agreement. The obligations of the General Partner under this Letter
Agreement shall terminate in the event it is no longer the general partner
of the Partnership. Any successor of the General Partner as general
partner of the Partnership shall be bound by this Letter Agreement.
g.
Counterparts. This Letter Agreement may be executed in counterparts
(whether original, electronic or facsimile counterparts), each of which
shall be deemed an original and which together shall constitute one and
the same instrument.
h. Governing Law and Venue. This Letter Agreement shall be governed by,
and interpreted and enforced in accordance with, the laws of the state of
Delaware without giving effect to the principles, policies or provisions
relating to choice or conflict of laws, except to the extent the terms hereof
expressly require interpretation or enforcement of a law, regulation or
public policy of the State of Florida, in which case the laws of the State of
Florida, as applicable shall govern. In consideration of the Investor's
status as an agency of the State of Florida, notwithstanding anything to the
contrary in the Partnership Agreement or the Investor's Subscription
Agreement, as to the Investor, courts within the State of Delaware,
whether state or federal, shall not be the exclusive venue for disputes
arising, directly or indirectly, under or in connection with this Letter
Agreement or any dispute solely among the parties to this Letter
Agreement in connection with the Subscription Agreement of the Investor,
the Partnership Agreement and any amendments thereto.
If this Letter Agreement correctly sets forth our understanding and agreement
with respect to the matters addressed herein, please so confirm by executing this Letter
Agreement in the space provided below.
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IN WITNESS WHEREOF, the parties hereto have caused this Letter Agreement to be executed
as of the day and year first above written:
US Government Building Open -End Feeder 1, LP,
a Delaware limited partnership
By: US Government Building GP, LLC, its sole general partner
By: USAA Equity Advisors, Inc., its sole member
By:
Name:
Title:
US Government Building GP, LLC, a Delaware limited liability company
By: USAA Equity Advisors, Inc., its sole member
By:
Name:
Title:
Acknowledged and agreed as of the date first written above:
Board of Trustees of the City of Clearwater
Employees' Pension Fund
Cte0r1(f\Cf( vS
By:
Name: George N. Cretekos
Title: Chairperson
Approved as to Form:
Matthew Smith,jssistant Rosemarie Call, City
City Attorney
US Government Building Open -End Feeder 1, LP — City of Clearwater Side Letter Agreement