High Distribution II Units. (A) Except as otherwise provided in this Section 12.01(a)(iii) or elsewhere in this Agreement, holders of High Distribution II Units shall have the same rights, privileges, and obligations as, and shall be subject to the same restrictions as, High Distribution Units. (B) The Partnership shall maintain an HDII Account with respect to each holder of High Distribution II Units. With respect to any High Distribution II Unit issued after the Holdings Partnership Division, the HDII Account shall initially be equal to the amount per Unit mutually agreed by the Founding/Working Partner and the General Partner upon the issuance of such Unit, subject to Section 12.01(a)(iii)(K) and shall be adjusted as hereinafter provided. With respect to any High Distribution II Unit that is a Legacy Unit, the HDII Account for such Legacy Unit shall be apportioned in the Holdings Partnership Division between such Legacy Unit, on the one hand, and the Newmark Holdings Legacy Unit issued in the Holdings Partnership Division in respect of such Legacy Unit, on the other hand, based on the Relative Value of BGC and Newmark, such that the sum of the HDII Account for such Legacy Unit and Newmark Holdings Legacy Unit immediately following the Holdings Partnership Division shall equal the HDII Account for such Legacy Unit immediately prior to the Holdings Partnership Division. High Distribution II Units held as a result of modification of High Distribution Units shall, solely for purposes of this Section 12.01(a)(iii), be treated as issued on the date of such modification, except that such Units shall be treated as having been held by such Founding/Working Partner since the date the High Distribution Units were originally acquired for purposes of determining the amount distributable to a holder of High Distribution II Units pursuant to Section 12.01(a)(iii)(J). (C) Each HDII Account shall be reduced, but not below zero (0), by (x) any cash contributed to the Partnership by a holder of High Distribution II Units and designated as an HDII Contribution, (y) any reduction in distributions to such Founding/Working Partner pursuant to Section 12.01(a)(iii)(G), 12.01(a)(iii)(H) or 12.01(a)(iii)(J), and (z) any amount contributed by a holder of High Distribution II Units pursuant to Section 9.05 to restore any negative balance in his, her or its Capital Account (all amounts referred to in (x), (y) and (z) shall be defined as “HDII Contributions”). (D) In the event that a Loss is allocated with respect to a Founding/Working Partner’s High Distribution II Units during any period, such Founding/Working Partner’s HDII Account shall be increased by the smaller of (x) the amount of such Loss and (y) the amount of such Founding/Working Partner’s HDII Special Allocation. (E) Pursuant to Section 2(k) of Exhibit D to this Agreement, a portion of the items of loss or deduction of the Partnership for each period shall specifically be allocated to each Founding/Working Partner holding High Distribution II Units with a positive HDII Account. Such portion (the “HDII Special Allocation”) shall be equal to the product of (x) the balance of such HDII Account and (y) the rate mutually agreed by the Founding/Working Partner and the General Partner from time to time (the “HDII Special Allocation Rate”). Such HDII Special Allocation Rate may be fixed or established by formula. (F) A Founding/Working Partner’s HDII Account for each Unit must periodically be reduced to the level specified in a schedule mutually agreed by the Founding/Working Partner and the General Partner. If no schedule is agreed, the HDII Account shall be reduced by an amount sufficient so that the HDII Account is (w) no greater than 75% of its original value on the first December 15th after such Unit’s issuance; (x) no greater than 50% of its original value on the second December 15th after such Unit’s issuance; (y) no greater than 25% of its original value on the third December 15th after such Unit’s issuance; and (z) zero (0) on the fourth December 15th after such Unit’s issuance; provided, however, that any such December 15th date may be extended at the sole and absolute discretion of the General Partner to any later date in December of such year. To the extent that any HDII Account exceeds the relevant level set forth in the schedule or, if no schedule is agreed upon, the relevant level specified in the preceding sentence, such Founding/Working Partner’s HDII Account shall be reduced through adjustments to distributions pursuant to Section 12.01(a)(iii)(G) or 12.01(a)(iii)(H). Reductions required to be made pursuant to this Section 12.01(a)(iii)(F) shall be referred to as an “HDII Account Reduction Obligation.” With respect to any High Distribution II Unit that is a Legacy Unit, each relevant level set forth in the schedule contemplated by the first sentence of this Section 12.01(a)(iii)(F) or, if no schedule is agreed upon, each relevant level specified in the preceding sentence, shall be apportioned in the Holdings Partnership Division between such Legacy Unit, on the one hand, and the Newmark Holdings Legacy Unit issued in the Holdings Partnership Division in respect of such Legacy Unit, on the other hand, based on the Relative Value of BGC and Newmark, such that the sum of the applicable levels for such Legacy Unit and Newmark Holdings Legacy Unit immediately following the Holdings Partnership Division shall equal the applicable level for such Legacy Unit immediately prior to the Holdings Partnership Division. (G) Amounts distributable to any Founding/Working Partner holding High Distribution II Units for any period shall be reduced, but not below zero (0), by the amount of any HDII Account Reduction Obligation that has not previously been satisfied. To the extent that any HDII Account Reduction Obligation for any date exceeds the amount, if any, that would otherwise be distributed to such Founding/Working Partner within five (5) days of such date, after application of any withholding tax or other payments on behalf of such Founding/Working Partner pursuant to Section 5.09, such Founding/Working Partner shall be required to make additional HDII Contributions to the Partnership pursuant to Section 12.01(a)(iii)(C) in an amount equal to such excess. (H) The General Partner may reduce any distribution otherwise payable to any holder of High Distribution II Units by an amount not to exceed the HDII Account Reduction Obligation for any date during the fiscal year that includes such distribution. Such reduction shall be made after application of Section 12.01(a)(iii)(F). In applying this Section 12.01(a)(iii)(H), the General Partner may deem such Founding/Working Partner to have elected to receive a distribution equal to 100% of the General Partner’s estimate of the Partnership’s income and gain allocable to such Founding/Working Partner for such period. (I) Notwithstanding anything to the contrary contained in this Agreement, no additional Units shall be issued to a Founding/Working Partner holding High Distribution II Units as a result of any HDII Contribution occurring by way of cash contributions or reductions in amounts distributable to such Founding/Working Partner under Section 12.01(a)(iii)(G), 12.01(a)(iii)(H) or 12.01(a)(iii)(J). (J) In the event of the redemption of all or a portion of a Founding/Working Partner’s High Distribution II Units pursuant to Section 3.03, 9.02 or 12.05 or otherwise in accordance with this Agreement, the amount distributable to a Founding/Working Partner shall be reduced, but not below zero (0), by the HDII Account. In the event of the redemption of all of a Founding/Working Partner’s High Distribution II Units, the Founding/Working Partner’s HDII Account shall become immediately payable to the Partnership in full. In the event of the redemption of all or a portion of a Founding Partner’s High Distribution II Units, (x) an amount equal to the Founding Partner’s CFLP HDII Account with respect to such Units shall be paid to Cantor rather than being distributed to such Founding Partner on such date with respect to such Units and (y) if such High Distribution II Units called for redemption are purchased by Cantor pursuant to Section 12.02 or 12.03, the amount payable by Cantor to such Founding Partner or the Partnership for such Units shall be reduced by an amount equal to the Founding Partner’s CFLP HDII Account with respect to such Unit not theretofore paid by the Partner pursuant to this Section 12.01(a)(iii). (K) Any High Distribution II Unit that is designated as a Founding Partner Unit shall continue to have a CFLP HDII Account, CFLP HDII Special Allocation Rate and CFLP HDII Account Reduction Obligation (which amounts, for the avoidance of doubt, shall not be apportioned in or otherwise modified as a result of the Holdings Partnership Division), and the holder of such High Distribution II Unit shall satisfy its obligations to Cantor relating to such Unit by the application of any distributions that would be subject to reduction and any contributions that would be made by such holder under this Section 12.01(a)(iii), were such holder’s High Distribution II Unit to have an HDII Account, an HDII Special Allocation Rate and an HDII Account Reduction Obligation, equal to those it has to Cantor (and, in the case of any loss specially allocated to such holder by the Partnership reflecting the HDII Account Reduction Obligation it would have, an equivalent amount of income shall be allocated by the Partnership to Cantor). Any payment by a Partner to Cantor in respect of its CFLP HDII Account Reduction Obligation pursuant to this paragraph shall result in an increase in such Partner’s Capital Account in the Partnership (such payment to be treated, for purposes of maintaining Capital Accounts, as a capital contribution by such Partner to the Partnership and a distribution by the Partnership to Cantor). (L) Notwithstanding anything to the contrary contained in this Agreement, any Founding/Working Partner holding High Distribution II Units shall be required to make additional HDII Contributions to the Partnership by way of cash contributions and by reductions in amounts distributable to such Partner as provided in Sections 12.01(a)(iii)(G), 12.01(a)(iii)(H) and 12.01(a)(iii)(J). Such contributions must be made within five days of the General Partner notifying such holder of High Distribution II Units of its obligation hereunder. In the event that the required contribution is not made, the General Partner may, in its sole and absolute discretion, redeem all or a portion of such Founding/Working Partner’s High Distribution II Units, declare the High Distribution Unit II Unitholder to be in default under this Agreement, or take any other action available to it at law or in equity to enforce the obligation described in this Section 12.01(a)(iii)(L), including seeking enforcement of such obligation in any forum and in any jurisdiction (and each holder of High Distribution II Units hereby irrevocably submits to the jurisdiction of any such forum or jurisdiction), notwithstanding the jurisdictional provisions contained in Section 13.04, including the payment of legal fees and expenses related thereto. Any Partner not making a required contribution shall pay interest to the Partnership at a rate determined by the General Partner, and such interest payments shall not be treated as capital contributions hereunder or as part of such Partner’s Capital Account.

Appears in 3 contracts

Samples: Partnership Agreement (BGC Partners, Inc.), Partnership Agreement (Newmark Group, Inc.), Partnership Agreement (Newmark Group, Inc.)

High Distribution II Units. (A) Except as otherwise provided in this Section 12.01(a)(iii) or elsewhere in this Agreement, holders of High Distribution II Units shall have the same rights, privileges, and obligations as, and shall be subject to the same restrictions as, High Distribution Units. (B) The Partnership shall maintain an HDII Account with respect to each holder of High Distribution II Units. With respect to any High Distribution II Unit issued after the Holdings Partnership Division, the HDII Account for such Unit shall initially be equal to the amount per Unit mutually agreed by the Founding/Working Partner and the General Partner upon the issuance of such Unit, ~~subject to Section 12.01(a)(iii)(K)~~ and shall be adjusted as hereinafter provided. With respect to any High Distribution II Unit that is a Legacy ~~Unit~~Unit (if any), the HDII Account for the BGC Holdings Unit for which such Legacy Unit was issued in the Holdings Partnership Division shall be apportioned in the Holdings Partnership Division between such ~~Legacy~~ BGC Holding Unit, on the one hand, and ~~the Newmark Holdings Legacy Unit issued in the Holdings Partnership Division in respect of~~ such Legacy Unit, on the other hand, based on the Relative Value of BGC and Newmark, such that the sum of the HDII Account for such ~~Legacy~~ BGC Holdings Unit and ~~Newmark Holdings~~ Legacy Unit immediately following the Holdings Partnership Division shall equal the HDII Account for such ~~Legacy~~ BGC Holding Unit immediately prior to the Holdings Partnership Division. High Distribution II Units held as a result of modification of High Distribution Units shall, solely for purposes of this Section 12.01(a)(iii), be treated as issued on the date of such modification, except that such Units shall be treated as having been held by such Founding/Working Partner since the date the High Distribution Units were originally acquired (or, in the case of any Legacy Unit, the date on which the BGC Holdings Unit for which such Legacy Unit was issued in the Holdings Partnership Division was originally acquired) for purposes of determining the amount distributable to a holder of High Distribution II Units pursuant to Section 12.01(a)(iii)(J). (C) Each HDII Account shall be reduced, but not below zero (0), by (x) any cash contributed to the Partnership by a holder of High Distribution II Units and designated as an HDII Contribution, (y) any reduction in distributions to such Founding/Working Partner pursuant to Section 12.01(a)(iii)(G), 12.01(a)(iii)(H) or 12.01(a)(iii)(J), and (z) any amount contributed by a holder of High Distribution II Units pursuant to Section 9.05 to restore any negative balance in his, her or its Capital Account (all amounts referred to in (x), (y) and (z) shall be defined as “HDII Contributions”). (D) In the event that a Loss is allocated with respect to a Founding/Working Partner’s High Distribution II Units during any period, such Founding/Working Partner’s HDII Account shall be increased by the smaller of (x) the amount of such Loss and (y) the amount of such Founding/Working Partner’s HDII Special Allocation. (E) Pursuant to Section 2(k) of Exhibit D C to this Agreement, a portion of the items of loss or deduction of the Partnership for each period shall specifically be allocated to each Founding/Working Partner holding High Distribution II Units with a positive HDII Account. Such portion (the “HDII Special Allocation”) shall be equal to the product of (x) the balance of such HDII Account and (y) the rate mutually agreed by the Founding/Working Partner and the General Partner from time to time (the “HDII Special Allocation Rate”). Such HDII Special Allocation Rate may be fixed or established by formula. (F) A Founding/Working Partner’s HDII Account for each Unit must periodically be reduced to the level specified in a schedule mutually agreed by the Founding/Working Partner and the General Partner. If no schedule is agreed, the HDII Account shall be reduced by an amount sufficient so that the HDII Account is (w) no greater than 75% of its original value on the first December 15th after such Unit’s issuance; (x) no greater than 50% of its original value on the second December 15th after such Unit’s issuance; (y) no greater than 25% of its original value on the third December 15th after such Unit’s issuance; and (z) zero (0) on the fourth December 15th after such Unit’s issuance; provided, however, that any such December 15th date may be extended at the sole and absolute discretion of the General Partner to any later date in December of such year. To the extent that any HDII Account exceeds the relevant level set forth in the schedule or, if no schedule is agreed upon, the relevant level specified in the preceding sentence, such Founding/Working Partner’s HDII Account shall be reduced through adjustments to distributions pursuant to Section 12.01(a)(iii)(G) or 12.01(a)(iii)(H). Reductions required to be made pursuant to this Section 12.01(a)(iii)(F) shall be referred to as an “HDII Account Reduction Obligation.” With respect to any High Distribution II Unit that is a Legacy Unit, each relevant level set forth in the schedule contemplated by the first sentence of this Section 12.01(a)(iii)(F) or, if no schedule is agreed upon, each relevant level specified in the preceding ~~sentence~~sentence for the BGC Holdings Unit for which such Legacy Unit was issued in the Holdings Partnership Division , shall be apportioned in the Holdings Partnership Division between such ~~Legacy~~ BGC Holding Unit, on the one hand, and ~~the Newmark Holdings Legacy Unit issued in the Holdings Partnership Division in respect of~~ such Legacy Unit, on the other hand, based on the Relative Value of BGC and Newmark, such that the sum of the applicable levels for such ~~Legacy~~ BGC Holdings Unit and ~~Newmark Holdings~~ Legacy Unit immediately following the Holdings Partnership Division shall equal the applicable level for such ~~Legacy~~ BGC Holding Unit immediately prior to the Holdings Partnership ~~Division~~Division . (G) Amounts distributable to any Founding/Working Partner holding High Distribution II Units for any period shall be reduced, but not below zero (0), by the amount of any HDII Account Reduction Obligation that has not previously been satisfied. To the extent that any HDII Account Reduction Obligation for any date exceeds the amount, if any, that would otherwise be distributed to such Founding/Working Partner within five (5) days of such date, after application of any withholding tax or other payments on behalf of such Founding/Working Partner pursuant to Section 5.09, such Founding/Working Partner shall be required to make additional HDII Contributions to the Partnership pursuant to Section 12.01(a)(iii)(C) in an amount equal to such excess. (H) The General Partner may reduce any distribution otherwise payable to any holder of High Distribution II Units by an amount not to exceed the HDII Account Reduction Obligation for any date during the fiscal year that includes such distribution. Such reduction shall be made after application of Section 12.01(a)(iii)(F). In applying this Section 12.01(a)(iii)(H), the General Partner may deem such Founding/Working Partner to have elected to receive a distribution equal to 100% of the General Partner’s estimate of the Partnership’s income and gain allocable to such Founding/Working Partner for such period. (I) Notwithstanding anything to the contrary contained in this Agreement, no additional Units shall be issued to a Founding/Working Partner holding High Distribution II Units as a result of any HDII Contribution occurring by way of cash contributions or reductions in amounts distributable to such Founding/Working Partner under Section 12.01(a)(iii)(G), 12.01(a)(iii)(H) or 12.01(a)(iii)(J). (J) In the event of the redemption of all or a portion of a Founding/Working Partner’s High Distribution II Units pursuant to Section 3.03, 9.02 or 12.05 or otherwise in accordance with this Agreement, the amount distributable to a Founding/Working Partner shall be reduced, but not below zero (0), by the HDII Account. In the event of the redemption of all of a Founding/Working Partner’s High Distribution II Units, the Founding/Working Partner’s HDII Account shall become immediately payable to the Partnership in full. In the event of the redemption of all or a portion of a Founding Partner’s High Distribution II Units, (x) an amount equal to the Founding Partner’s CFLP HDII Account with respect to such Units shall be paid to Cantor rather than being distributed to such Founding Partner on such date with respect to such Units and (y) if such High Distribution II Units called for redemption are purchased by Cantor pursuant to Section 12.02 or 12.03, the amount payable by Cantor to such Founding Partner or the Partnership for such Units shall be reduced by an amount equal to the Founding Partner’s CFLP HDII Account with respect to such Unit not theretofore paid by the Partner pursuant to this Section 12.01(a)(iii). (K) Any High Distribution II Unit that is designated as a Founding Partner Unit shall continue to have a CFLP HDII Account, CFLP HDII Special Allocation Rate and CFLP HDII Account Reduction Obligation (which amounts, for the avoidance of doubt, shall not be apportioned in or otherwise modified as a result of the Holdings Partnership Division), and the holder of such High Distribution II Unit shall satisfy its obligations to Cantor relating to such Unit by the application of any distributions that would be subject to reduction and any contributions that would be made by such holder under this Section 12.01(a)(iii), were such holder’s High Distribution II Unit to have an HDII Account, an HDII Special Allocation Rate and an HDII Account Reduction Obligation, equal to those it has to Cantor (and, in the case of any loss specially allocated to such holder by the Partnership reflecting the HDII Account Reduction Obligation it would have, an equivalent amount of income shall be allocated by the Partnership to Cantor). Any payment by a Partner to Cantor in respect of its CFLP HDII Account Reduction Obligation pursuant to this paragraph shall result in an increase in such Partner’s Capital Account in the Partnership (such payment to be treated, for purposes of maintaining Capital Accounts, as a capital contribution by such Partner to the Partnership and a distribution by the Partnership to Cantor). (L) Notwithstanding anything to the contrary contained in this Agreement, any Founding/Working Partner holding High Distribution II Units shall be required to make additional HDII Contributions to the Partnership by way of cash contributions and by reductions in amounts distributable to such Partner as provided in Sections 12.01(a)(iii)(G), 12.01(a)(iii)(H) and 12.01(a)(iii)(J). Such contributions must be made within five days of the General Partner notifying such holder of High Distribution II Units of its obligation hereunder. In the event that the required contribution is not made, the General Partner may, in its sole and absolute discretion, redeem all or a portion of such Founding/Working Partner’s High Distribution II Units, declare the High Distribution Unit II Unitholder to be in default under this Agreement, or take any other action available to it at law or in equity to enforce the obligation described in this Section 12.01(a)(iii)(L), including seeking enforcement of such obligation in any forum and in any jurisdiction (and each holder of High Distribution II Units hereby irrevocably submits to the jurisdiction of any such forum or jurisdiction), notwithstanding the jurisdictional provisions contained in Section 13.04, including the payment of legal fees and expenses related thereto. Any Partner not making a required contribution shall pay interest to the Partnership at a rate determined by the General Partner, and such interest payments shall not be treated as capital contributions hereunder or as part of such Partner’s Capital Account.

Appears in 1 contract

Samples: Partnership Agreement (BGC Partners, Inc.)

High Distribution II Units. (A) Except as otherwise provided in this Section 12.01(a)(iii) or elsewhere in this Agreement, holders of High Distribution II Units shall have the same rights, privileges, and obligations as, and shall be subject to the same restrictions as, High Distribution Units. (B) The Partnership shall maintain an HDII Account with respect to each holder of High Distribution II Units. With respect to any High Distribution II Unit issued after the Holdings Partnership Division, the HDII Account for such Unit shall initially be equal to the amount per Unit mutually agreed by the Founding/Working Partner and the General Partner upon the issuance of such Unit, ~~subject to Section 12.01(a)(iii)(K)~~ and shall be adjusted as hereinafter provided. With respect to any High Distribution II Unit that is a Legacy ~~Unit~~Unit (if any), the HDII Account for the BGC Holdings Unit for which such Legacy Unit was issued in the Holdings Partnership Division shall be apportioned in the Holdings Partnership Division between such ~~Legacy~~ BGC Holding Unit, on the one hand, and ~~the Newmark Holdings Legacy Unit issued in the Holdings Partnership Division in respect of~~ such Legacy Unit, on the other hand, based on the Relative Value of BGC and Newmark, such that the sum of the HDII Account for such ~~Legacy~~ BGC Holdings Unit and ~~Newmark Holdings~~ Legacy Unit immediately following the Holdings Partnership Division shall equal the HDII Account for such ~~Legacy~~ BGC Holding Unit immediately prior to the Holdings Partnership Division. High Distribution II Units held as a result of modification of High Distribution Units shall, solely for purposes of this Section 12.01(a)(iii), be treated as issued on the date of such modification, except that such Units shall be treated as having been held by such Founding/Working Partner since the date the High Distribution Units were originally acquired (or, in the case of any Legacy Unit, the date on which the BGC Holdings Unit for which such Legacy Unit was issued in the Holdings Partnership Division was originally acquired) for purposes of determining the amount distributable to a holder of High Distribution II Units pursuant to Section 12.01(a)(iii)(J). (C) Each HDII Account shall be reduced, but not below zero (0), by (x) any cash contributed to the Partnership by a holder of High Distribution II Units and designated as an HDII Contribution, (y) any reduction in distributions to such Founding/Working Partner pursuant to Section 12.01(a)(iii)(G), 12.01(a)(iii)(H) or 12.01(a)(iii)(J), and (z) any amount contributed by a holder of High Distribution II Units pursuant to Section 9.05 to restore any negative balance in his, her or its Capital Account (all amounts referred to in (x), (y) and (z) shall be defined as “HDII Contributions”). (D) In the event that a Loss is allocated with respect to a Founding/Working Partner’s High Distribution II Units during any period, such Founding/Working Partner’s HDII Account shall be increased by the smaller of (x) the amount of such Loss and (y) the amount of such Founding/Working Partner’s HDII Special Allocation. (E) Pursuant to Section 2(k) of Exhibit D C to this Agreement, a portion of the items of loss or deduction of the Partnership for each period shall specifically be allocated to each Founding/Working Partner holding High Distribution II Units with a positive HDII Account. Such portion (the “HDII Special Allocation”) shall be equal to the product of (x) the balance of such HDII Account and (y) the rate mutually agreed by the Founding/Working Partner and the General Partner from time to time (the “HDII Special Allocation Rate”). Such HDII Special Allocation Rate may be fixed or established by formula. (F) A Founding/Working Partner’s HDII Account for each Unit must periodically be reduced to the level specified in a schedule mutually agreed by the Founding/Working Partner and the General Partner. If no schedule is agreed, the HDII Account shall be reduced by an amount sufficient so that the HDII Account is (w) no greater than 75% of its original value on the first December 15th after such Unit’s issuance; (x) no greater than 50% of its original value on the second December 15th after such Unit’s issuance; (y) no greater than 25% of its original value on the third December 15th after such Unit’s issuance; and (z) zero (0) on the fourth December 15th after such Unit’s issuance; provided, however, that any such December 15th date may be extended at the sole and absolute discretion of the General Partner to any later date in December of such year. To the extent that any HDII Account exceeds the relevant level set forth in the schedule or, if no schedule is agreed upon, the relevant level specified in the preceding sentence, such Founding/Working Partner’s HDII Account shall be reduced through adjustments to distributions pursuant to Section 12.01(a)(iii)(G) or 12.01(a)(iii)(H). Reductions required to be made pursuant to this Section 12.01(a)(iii)(F) shall be referred to as an “HDII Account Reduction Obligation.” With respect to any High Distribution II Unit that is a Legacy Unit, each relevant level set forth in the schedule contemplated by the first sentence of this Section 12.01(a)(iii)(F) or, if no schedule is agreed upon, each relevant level specified in the preceding ~~sentence~~sentence for the BGC Holdings Unit for which such Legacy Unit was issued in the Holdings Partnership Division , shall be apportioned in the Holdings Partnership Division between such ~~Legacy~~ BGC Holding Unit, on the one hand, and ~~the Newmark Holdings Legacy Unit issued in the Holdings Partnership Division in respect of~~ such Legacy Unit, on the other hand, based on the Relative Value of BGC and Newmark, such that the sum of the applicable levels for such ~~Legacy~~ BGC Holdings Unit and ~~Newmark Holdings~~ Legacy Unit immediately following the Holdings Partnership Division shall equal the applicable level for such ~~Legacy~~ BGC Holding Unit immediately prior to the Holdings Partnership Division. (G) Amounts distributable to any Founding/Working Partner holding High Distribution II Units for any period shall be reduced, but not below zero (0), by the amount of any HDII Account Reduction Obligation that has not previously been satisfied. To the extent that any HDII Account Reduction Obligation for any date exceeds the amount, if any, that would otherwise be distributed to such Founding/Working Partner within five (5) days of such date, after application of any withholding tax or other payments on behalf of such Founding/Working Partner pursuant to Section 5.09, such Founding/Working Partner shall be required to make additional HDII Contributions to the Partnership pursuant to Section 12.01(a)(iii)(C) in an amount equal to such excess. (H) The General Partner may reduce any distribution otherwise payable to any holder of High Distribution II Units by an amount not to exceed the HDII Account Reduction Obligation for any date during the fiscal year that includes such distribution. Such reduction shall be made after application of Section 12.01(a)(iii)(F). In applying this Section 12.01(a)(iii)(H), the General Partner may deem such Founding/Working Partner to have elected to receive a distribution equal to 100% of the General Partner’s estimate of the Partnership’s income and gain allocable to such Founding/Working Partner for such period. (I) Notwithstanding anything to the contrary contained in this Agreement, no additional Units shall be issued to a Founding/Working Partner holding High Distribution II Units as a result of any HDII Contribution occurring by way of cash contributions or reductions in amounts distributable to such Founding/Working Partner under Section 12.01(a)(iii)(G), 12.01(a)(iii)(H) or 12.01(a)(iii)(J). (J) In the event of the redemption of all or a portion of a Founding/Working Partner’s High Distribution II Units pursuant to Section 3.03, 9.02 or 12.05 or otherwise in accordance with this Agreement, the amount distributable to a Founding/Working Partner shall be reduced, but not below zero (0), by the HDII Account. In the event of the redemption of all of a Founding/Working Partner’s High Distribution II Units, the Founding/Working Partner’s HDII Account shall become immediately payable to the Partnership in full. In the event of the redemption of all or a portion of a Founding Partner’s High Distribution II Units, (x) an amount equal to the Founding Partner’s CFLP HDII Account with respect to such Units shall be paid to Cantor rather than being distributed to such Founding Partner on such date with respect to such Units and (y) if such High Distribution II Units called for redemption are purchased by Cantor pursuant to Section 12.02 or 12.03, the amount payable by Cantor to such Founding Partner or the Partnership for such Units shall be reduced by an amount equal to the Founding Partner’s CFLP HDII Account with respect to such Unit not theretofore paid by the Partner pursuant to this Section 12.01(a)(iii). (K) Any High Distribution II Unit that is designated as a Founding Partner Unit shall continue to have a CFLP HDII Account, CFLP HDII Special Allocation Rate and CFLP HDII Account Reduction Obligation (which amounts, for the avoidance of doubt, shall not be apportioned in or otherwise modified as a result of the Holdings Partnership Division), and the holder of such High Distribution II Unit shall satisfy its obligations to Cantor relating to such Unit by the application of any distributions that would be subject to reduction and any contributions that would be made by such holder under this Section 12.01(a)(iii), were such holder’s High Distribution II Unit to have an HDII Account, an HDII Special Allocation Rate and an HDII Account Reduction Obligation, equal to those it has to Cantor (and, in the case of any loss specially allocated to such holder by the Partnership reflecting the HDII Account Reduction Obligation it would have, an equivalent amount of income shall be allocated by the Partnership to Cantor). Any payment by a Partner to Cantor in respect of its CFLP HDII Account Reduction Obligation pursuant to this paragraph shall result in an increase in such Partner’s Capital Account in the Partnership (such payment to be treated, for purposes of maintaining Capital Accounts, as a capital contribution by such Partner to the Partnership and a distribution by the Partnership to Cantor). (L) Notwithstanding anything to the contrary contained in this Agreement, any Founding/Working Partner holding High Distribution II Units shall be required to make additional HDII Contributions to the Partnership by way of cash contributions and by reductions in amounts distributable to such Partner as provided in Sections 12.01(a)(iii)(G), 12.01(a)(iii)(H) and 12.01(a)(iii)(J). Such contributions must be made within five days of the General Partner notifying such holder of High Distribution II Units of its obligation hereunder. In the event that the required contribution is not made, the General Partner may, in its sole and absolute discretion, redeem all or a portion of such Founding/Working Partner’s High Distribution II Units, declare the High Distribution Unit II Unitholder to be in default under this Agreement, or take any other action available to it at law or in equity to enforce the obligation described in this Section 12.01(a)(iii)(L), including seeking enforcement of such obligation in any forum and in any jurisdiction (and each holder of High Distribution II Units hereby irrevocably submits to the jurisdiction of any such forum or jurisdiction), notwithstanding the jurisdictional provisions contained in Section 13.04, including the payment of legal fees and expenses related thereto. Any Partner not making a required contribution shall pay interest to the Partnership at a rate determined by the General Partner, and such interest payments shall not be treated as capital contributions hereunder or as part of such Partner’s Capital Account.

Appears in 1 contract

Samples: Partnership Agreement (Newmark Group, Inc.)

High Distribution II Units. (Ai) Except as otherwise provided in this Section ~~12.01(a)(iii~~12.01(b) or elsewhere in this Agreement, holders of High Distribution II Units shall have the same rights, privileges, and obligations as, and shall be subject to the same restrictions as, High Distribution Units. (Bii) The Partnership shall maintain an HDII Account with respect to each holder of High Distribution II Units. ~~With respect to any High Distribution II Unit issued after the Holdings Partnership Division, the~~ The HDII Account shall initially be equal to the amount per Unit mutually agreed by the Founding/Working Partner and the General Partner upon the issuance of ~~such Unit~~any High Distribution II Units, subject to Section ~~12.01(a)(iii)(K~~12.01(b)(ix) and shall be adjusted as hereinafter provided. With respect to any High Distribution II Unit that is a Legacy Unit, the HDII Account for such Legacy Unit shall be apportioned in the Holdings Partnership Division between such Legacy Unit, on the one hand, and the Newmark Holdings Legacy Unit issued in the Holdings Partnership Division in respect of such Legacy Unit, on the other hand, based on the Relative Value of BGC and Newmark, such that the sum of the HDII Account for such Legacy Unit and Newmark Holdings Legacy Unit immediately following the Holdings Partnership Division shall equal the HDII Account for such Legacy Unit immediately prior to the Holdings Partnership Division. High Distribution II Units held as a result of modification of High Distribution Units shall, solely for purposes of this Section ~~12.01(a)(iii~~12.01(b), be treated as issued on the date of such modification, except that such Units shall be treated as having been held by such Founding/Working Partner since the date the High Distribution Units were originally ~~acquired~~ purchased for purposes of determining the amount distributable to a holder of High Distribution II Units pursuant to Section ~~12.01(a)(iii)(J~~12.01(b)(viii). (CA) Each HDII Account shall be reduced, but not below zero (0), by (x) any cash contributed to the Partnership by a holder of High Distribution II Units and designated as an HDII ~~Contribution,~~ Contribution or (y) any reduction in distributions to such Founding/Working Partner pursuant to Section ~~12.01(a)(iii)(G~~12.01(b)(v), ~~12.01(a)(iii)(H~~12.01(b)(vi) or ~~12.01(a)(iii)(J), and (z~~12.01(b)(viii) ~~any amount contributed by a holder of High Distribution II Units pursuant to Section 9.05 to restore any negative balance in his, her or its Capital Account~~ (all amounts referred to in (x~~), (y~~) and (zy) shall be defined as “HDII Contributions”). (DB) In the event that a Loss is allocated with respect to a Founding/Working Partner’s High Distribution II Units during any period, such Founding/Working Partner’s HDII Account shall be increased by the smaller of (x) the amount of such Loss and (y) the amount of such Founding/Working Partner’s HDII Special Allocation. (Eiii) Pursuant to Section 2(k) of Exhibit D to this Agreement, a portion of the items of loss or deduction of the Partnership for each period shall specifically be allocated to each Founding/Working Partner holding High Distribution II Units with a positive HDII Account. Such portion (the “HDII Special Allocation”) shall be equal to the product of (x1) the balance of such HDII Account and (y2) the rate mutually agreed by the Founding/Working Partner and the General Partner from time to time (the “HDII Special Allocation Rate”). Such HDII Special Allocation Rate may be fixed or established by formula. (Fiv) A Founding/Working Partner’s HDII Account for each Unit must periodically be reduced to the level specified in a schedule mutually agreed by the Founding/Working Partner and the General Partner. If no schedule is agreed, the HDII Account shall be reduced by an amount sufficient so that the HDII Account is (wi) no greater than 75% of its original value on the first December 15th after such Unit’s issuance; (xii) no greater than 50% of its original value on the second December 15th after such Unit’s issuance; (yiii) no greater than 25% of its original value on the third December 15th after such Unit’s issuance; and (ziv) zero (0) on the fourth December 15th after such Unit’s issuance; provided, however, that any such December 15th date may be extended at the sole and absolute discretion of the General Partner to any later date in December of such year. To the extent that any HDII Account exceeds the relevant level set forth in the schedule or, if no schedule is agreed upon, the relevant level specified in the preceding sentence, such Founding/Working Partner’s HDII Account shall be reduced through adjustments to distributions pursuant to Section ~~12.01(a)(iii)(G~~12.01(b)(v) or ~~12.01(a)(iii)(H~~12.01(b)(vi). Reductions required to be made pursuant to this Section ~~12.01(a)(iii)(F~~12.01(b)(iv) shall be referred to as an “HDII Account Reduction Obligation.” With respect to any High Distribution II Unit that is a Legacy Unit, each relevant level set forth in the schedule contemplated by the first sentence of this Section 12.01(a)(iii)(F) or, if no schedule is agreed upon, each relevant level specified in the preceding sentence, shall be apportioned in the Holdings Partnership Division between such Legacy Unit, on the one hand, and the Newmark Holdings Legacy Unit issued in the Holdings Partnership Division in respect of such Legacy Unit, on the other hand, based on the Relative Value of BGC and Newmark, such that the sum of the applicable levels for such Legacy Unit and Newmark Holdings Legacy Unit immediately following the Holdings Partnership Division shall equal the applicable level for such Legacy Unit immediately prior to the Holdings Partnership Division.” (Gv) Amounts distributable to any Founding/Working Partner holding High Distribution II Units for any period shall be reduced, but not below zero (0), by the amount of any HDII Account Reduction Obligation that has not previously been satisfied. To the extent that any HDII Account Reduction Obligation for any date exceeds the amount, if any, that would otherwise be distributed to such Founding/Working Partner within five (5) days of such date, after application of any withholding tax or other payments on behalf of such Founding/Working Partner pursuant to Section 5.09, such Founding/Working Partner shall be required to make additional HDII Contributions to the Partnership pursuant to Section ~~12.01(a)(iii)(C~~12.01(b) in an amount equal to such excess. (Hvi) The General Partner may reduce any distribution otherwise payable to any holder of High Distribution II Units by an amount not to exceed the HDII Account Reduction Obligation for any date during the fiscal year that includes such distribution. Such reduction shall be made after application of Section ~~12.01(a)(iii)(F~~12.01(b)(iv). In applying this Section ~~12.01(a)(iii)(H~~12.01(b)(vi), the General Partner may deem such Founding/Working Partner to have elected to receive a distribution equal to 100% of the ~~General Partner’s estimate of the Partnership’s income and gain~~ Estimated Income allocable to such Founding/Working Partner for such period. (Ivii) Notwithstanding anything to the contrary contained in this Agreement, no additional Units shall be issued to a Founding/Working Partner holding High Distribution II Units as a result of any HDII Contribution occurring by way of cash contributions or and reductions in amounts distributable to such Founding/Working Partner under Section ~~12.01(a)(iii)(G~~12.01(b)(v), ~~12.01(a)(iii)(H~~12.01(b)(vi) or ~~12.01(a)(iii)(J~~12.01(b)(viii). (Jviii) In the event of the redemption of all or a portion of a Founding/Working Partner’s High Distribution II Units pursuant to Section 3.03, 9.02 or 12.05 or otherwise in accordance with this Agreement, the amount distributable to a Founding/Working Partner shall be reduced, but not below zero (0), by the HDII Account. In the event of the redemption of all of a Founding/Working Partner’s High Distribution II Units, the Founding/Working Partner’s HDII Account shall become immediately payable to the Partnership in full. In the event of the redemption of all or a portion of a Founding Partner’s High Distribution II Units, (xa) an amount equal to the Founding Partner’s CFLP HDII Account with respect to such Units shall be paid to Cantor rather than being distributed to such Founding Partner on such date with respect to such Units and (yb) if such High Distribution II Units called for redemption are purchased by Cantor pursuant to Section 12.02 or 12.03, the amount payable by Cantor to such Founding Partner or the Partnership for such Units shall be reduced by an amount equal to the Founding Partner’s CFLP HDII Account with respect to such Unit not theretofore paid by the Partner pursuant to this Section ~~12.01(a)(iii~~12.01(b). (Kix) Any High Distribution II Unit that is designated as a Founding Partner Unit shall continue to have a CFLP HDII Account, CFLP HDII Special Allocation Rate and CFLP HDII Account Reduction ~~Obligation (which amounts, for the avoidance of doubt, shall not be apportioned in or otherwise modified as a result of the Holdings Partnership Division)~~Obligation, and the holder of such High Distribution II Unit shall satisfy its obligations to Cantor relating to such Unit by the application of any distributions that would be subject to reduction and any contributions that would be made by such holder under this Section ~~12.01(a)(iii~~12.01(b), were such holder’s High Distribution II Unit to have an HDII Account, an a HDII Special Allocation Rate and an HDII Account Reduction Obligation, equal to those it has to Cantor (and, in the case of any loss specially allocated to such holder by the Partnership reflecting the HDII Account Reduction Obligation it would have, an equivalent amount of income shall be allocated by the Partnership to Cantor). Any payment by a Partner to Cantor in respect of its CFLP HDII Account Reduction Obligation pursuant to this paragraph shall result in an increase in such Partner’s Capital Account in the Partnership (such payment to be treated, for purposes of maintaining Capital Accounts, as a capital contribution by such Partner to the Partnership and a distribution by the Partnership to Cantor). (Lx) Notwithstanding anything to the contrary contained in this Agreement, any Founding/Working Partner holding High Distribution II Units shall be required to make additional HDII Contributions to the Partnership by way of cash contributions and by reductions in amounts distributable to such Partner as provided in Sections ~~12.01(a)(iii)(G~~12.01(b)(v), ~~12.01(a)(iii)(H~~12.01(b)(vi) and ~~12.01(a)(iii)(J~~12.01(b)(viii). Such contributions must be made within five days of the General Partner notifying such ~~holder of~~ High Distribution II ~~Units~~ Unitholder of its obligation hereunder. In the event that the required contribution is not made, the General Partner may, in its sole and absolute discretion, redeem all or a portion of such Founding/Working Partner’s High Distribution II Units, declare the High Distribution Unit II Unitholder to be in default under this Agreement, or take any other action available to it at law or in equity to enforce the obligation described in this Section ~~12.01(a)(iii)(L~~12.01(b)(x), ~~including~~ including, without limitation, seeking enforcement of such obligation in any forum and in any jurisdiction (and each ~~holder of~~ High Distribution II ~~Units~~ Unitholder hereby irrevocably submits to the jurisdiction of any such forum or jurisdiction), notwithstanding the jurisdictional provisions contained in Section ~~13.04~~13.04 hereof, including the payment of legal fees and expenses related thereto. Any Partner not making a required contribution shall pay interest to the Partnership at a rate determined by the General Partner, and such interest payments shall not be treated as capital contributions hereunder or as part of such Partner’s Capital Account.

Appears in 1 contract

Samples: Limited Partnership Agreement (BGC Partners, Inc.)

Appears in 1 contract

Samples: Partnership Agreement

High Distribution II Units. (A) Except as otherwise provided in this Section 12.01(a)(iii) or elsewhere in this Agreement, holders of High Distribution II Units shall have the same rights, privileges, and obligations as, and shall be subject to the same restrictions as, High Distribution Units. (B) The Partnership shall maintain an HDII Account with respect to each holder of High Distribution II Units. With respect to any High Distribution II Unit issued after the ~~Holdings Partnership Division~~Separation, the HDII Account for such Unit shall initially be equal to the amount per Unit mutually agreed by the Founding/Working Partner and the General Partner upon the issuance of such Unit, ~~subject to Section 12.01(a)(iii)(K)~~ and shall be adjusted as hereinafter provided. With respect to any High Distribution II Unit that is a Legacy ~~Unit~~Unit (if any), the HDII Account for the BGC Holdings Unit for which such Legacy Unit was issued in the Separation shall be apportioned in the ~~Holdings Partnership Division~~ Separation between such ~~Legacy~~ BGC Holding Unit, on the one hand, and ~~the Newmark Holdings Legacy Unit issued in the Holdings Partnership Division in respect of~~ such Legacy Unit, on the other hand, based on the Relative Value of BGC and Newmark, such that the sum of the HDII Account for such ~~Legacy~~ BGC Holdings Unit and ~~Newmark Holdings~~ Legacy Unit immediately following the ~~Holdings Partnership Division~~ Separation shall equal the HDII Account for such ~~Legacy~~ BGC Holding Unit immediately prior to the ~~Holdings Partnership Division~~Separation. High Distribution II Units held as a result of modification of High Distribution Units shall, solely for purposes of this Section 12.01(a)(iii), be treated as issued on the date of such modification, except that such Units shall be treated as having been held by such Founding/Working Partner since the date the High Distribution Units were originally acquired (or, in the case of any Legacy Unit, the date on which the BGC Holdings Unit for which such Legacy Unit was issued in the Separation was originally acquired) for purposes of determining the amount distributable to a holder of High Distribution II Units pursuant to Section 12.01(a)(iii)(J). (C) Each HDII Account shall be reduced, but not below zero (0), by (x) any cash contributed to the Partnership by a holder of High Distribution II Units and designated as an HDII Contribution, (y) any reduction in distributions to such Founding/Working Partner pursuant to Section 12.01(a)(iii)(G), 12.01(a)(iii)(H) or 12.01(a)(iii)(J), and (z) any amount contributed by a holder of High Distribution II Units pursuant to Section 9.05 to restore any negative balance in his, her or its Capital Account (all amounts referred to in (x), (y) and (z) shall be defined as “HDII Contributions”). (D) In the event that a Loss is allocated with respect to a Founding/Working Partner’s High Distribution II Units during any period, such Founding/Working Partner’s HDII Account shall be increased by the smaller of (x) the amount of such Loss and (y) the amount of such Founding/Working Partner’s HDII Special Allocation. (E) Pursuant to Section 2(k) of Exhibit D C to this Agreement, a portion of the items of loss or deduction of the Partnership for each period shall specifically be allocated to each Founding/Working Partner holding High Distribution II Units with a positive HDII Account. Such portion (the “HDII Special Allocation”) shall be equal to the product of (x) the balance of such HDII Account and (y) the rate mutually agreed by the Founding/Working Partner and the General Partner from time to time (the “HDII Special Allocation Rate”). Such HDII Special Allocation Rate may be fixed or established by formula. (F) A Founding/Working Partner’s HDII Account for each Unit must periodically be reduced to the level specified in a schedule mutually agreed by the Founding/Working Partner and the General Partner. If no schedule is agreed, the HDII Account shall be reduced by an amount sufficient so that the HDII Account is (w) no greater than 75% of its original value on the first December 15th after such Unit’s issuance; (x) no greater than 50% of its original value on the second December 15th after such Unit’s issuance; (y) no greater than 25% of its original value on the third December 15th after such Unit’s issuance; and (z) zero (0) on the fourth December 15th after such Unit’s issuance; provided, however, that any such December 15th date may be extended at the sole and absolute discretion of the General Partner to any later date in December of such year. To the extent that any HDII Account exceeds the relevant level set forth in the schedule or, if no schedule is agreed upon, the relevant level specified in the preceding sentence, such Founding/Working Partner’s HDII Account shall be reduced through adjustments to distributions pursuant to Section 12.01(a)(iii)(G) or 12.01(a)(iii)(H). Reductions required to be made pursuant to this Section 12.01(a)(iii)(F) shall be referred to as an “HDII Account Reduction Obligation.” With respect to any High Distribution II Unit that is a Legacy Unit, each relevant level set forth in the schedule contemplated by the first sentence of this Section 12.01(a)(iii)(F) or, if no schedule is agreed upon, each relevant level specified in the preceding sentence, shall be apportioned in the Holdings Partnership Division between such Legacy Unit, on the one hand, and the Newmark Holdings Legacy Unit issued in the Holdings Partnership Division in respect of such Legacy Unit, on the other hand, based on the Relative Value of BGC and Newmark, such that the sum of the applicable levels for such Legacy Unit and Newmark Holdings Legacy Unit immediately following the Holdings Partnership Division shall equal the applicable level for such Legacy Unit immediately prior to the Holdings Partnership Division. (G) Amounts distributable to any Founding/Working Partner holding High Distribution II Units for any period shall be reduced, but not below zero (0), by the amount of any HDII Account Reduction Obligation that has not previously been satisfied. To the extent that any HDII Account Reduction Obligation for any date exceeds the amount, if any, that would otherwise be distributed to such Founding/Working Partner within five (5) days of such date, after application of any withholding tax or other payments on behalf of such Founding/Working Partner pursuant to Section 5.09, such Founding/Working Partner shall be required to make additional HDII Contributions to the Partnership pursuant to Section 12.01(a)(iii)(C) in an amount equal to such excess. (H) The General Partner may reduce any distribution otherwise payable to any holder of High Distribution II Units by an amount not to exceed the HDII Account Reduction Obligation for any date during the fiscal year that includes such distribution. Such reduction shall be made after application of Section 12.01(a)(iii)(F). In applying this Section 12.01(a)(iii)(H), the General Partner may deem such Founding/Working Partner to have elected to receive a distribution equal to 100% of the General Partner’s estimate of the Partnership’s income and gain allocable to such Founding/Working Partner for such period. (I) Notwithstanding anything to the contrary contained in this Agreement, no additional Units shall be issued to a Founding/Working Partner holding High Distribution II Units as a result of any HDII Contribution occurring by way of cash contributions or reductions in amounts distributable to such Founding/Working Partner under Section 12.01(a)(iii)(G), 12.01(a)(iii)(H) or 12.01(a)(iii)(J). (J) In the event of the redemption of all or a portion of a Founding/Working Partner’s High Distribution II Units pursuant to Section 3.03, 9.02 or 12.05 or otherwise in accordance with this Agreement, the amount distributable to a Founding/Working Partner shall be reduced, but not below zero (0), by the HDII Account. In the event of the redemption of all of a Founding/Working Partner’s High Distribution II Units, the Founding/Working Partner’s HDII Account shall become immediately payable to the Partnership in full. In the event of the redemption of all or a portion of a Founding Partner’s High Distribution II Units, (x) an amount equal to the Founding Partner’s CFLP HDII Account with respect to such Units shall be paid to Cantor rather than being distributed to such Founding Partner on such date with respect to such Units and (y) if such High Distribution II Units called for redemption are purchased by Cantor pursuant to Section 12.02 or 12.03, the amount payable by Cantor to such Founding Partner or the Partnership for such Units shall be reduced by an amount equal to the Founding Partner’s CFLP HDII Account with respect to such Unit not theretofore paid by the Partner pursuant to this Section 12.01(a)(iii). (K) Any High Distribution II Unit that is designated as a Founding Partner Unit shall continue to have a CFLP HDII Account, CFLP HDII Special Allocation Rate and CFLP HDII Account Reduction Obligation (which amounts, for the avoidance of doubt, shall not be apportioned in or otherwise modified as a result of the Holdings Partnership Division), and the holder of such High Distribution II Unit shall satisfy its obligations to Cantor relating to such Unit by the application of any distributions that would be subject to reduction and any contributions that would be made by such holder under this Section 12.01(a)(iii), were such holder’s High Distribution II Unit to have an HDII Account, an HDII Special Allocation Rate and an HDII Account Reduction Obligation, equal to those it has to Cantor (and, in the case of any loss specially allocated to such holder by the Partnership reflecting the HDII Account Reduction Obligation it would have, an equivalent amount of income shall be allocated by the Partnership to Cantor). Any payment by a Partner to Cantor in respect of its CFLP HDII Account Reduction Obligation pursuant to this paragraph shall result in an increase in such Partner’s Capital Account in the Partnership (such payment to be treated, for purposes of maintaining Capital Accounts, as a capital contribution by such Partner to the Partnership and a distribution by the Partnership to Cantor). (L) Notwithstanding anything to the contrary contained in this Agreement, any Founding/Working Partner holding High Distribution II Units shall be required to make additional HDII Contributions to the Partnership by way of cash contributions and by reductions in amounts distributable to such Partner as provided in Sections 12.01(a)(iii)(G), 12.01(a)(iii)(H) and 12.01(a)(iii)(J). Such contributions must be made within five days of the General Partner notifying such holder of High Distribution II Units of its obligation hereunder. In the event that the required contribution is not made, the General Partner may, in its sole and absolute discretion, redeem all or a portion of such Founding/Working Partner’s High Distribution II Units, declare the High Distribution Unit II Unitholder to be in default under this Agreement, or take any other action available to it at law or in equity to enforce the obligation described in this Section 12.01(a)(iii)(L), including seeking enforcement of such obligation in any forum and in any jurisdiction (and each holder of High Distribution II Units hereby irrevocably submits to the jurisdiction of any such forum or jurisdiction), notwithstanding the jurisdictional provisions contained in Section 13.04, including the payment of legal fees and expenses related thereto. Any Partner not making a required contribution shall pay interest to the Partnership at a rate determined by the General Partner, and such interest payments shall not be treated as capital contributions hereunder or as part of such Partner’s Capital Account.15th

Appears in 1 contract

Samples: Partnership Agreement (Newmark Group, Inc.)

High Distribution II Units. (A) Except as otherwise provided in this Section 12.01(a)(iii) or elsewhere in this Agreement, holders of High Distribution II Units shall have the same rights, privileges, and obligations as, and shall be subject to the same restrictions as, High Distribution Units. (B) The Partnership shall maintain an HDII Account with respect to each holder of High Distribution II Units. With respect to any High Distribution II Unit issued after the Holdings Partnership Division, the HDII Account for such Unit shall initially be equal to the amount per Unit mutually agreed by the Founding/Working Partner and the General Partner upon the issuance of such Unit, ~~subject to Section 12.01(a)(iii)(K)~~ and shall be adjusted as hereinafter provided. With respect to any High Distribution II Unit that is a Legacy ~~Unit~~Unit (if any), the HDII Account for the BGC Holdings Unit for which such Legacy Unit was issued in the Holdings Partnership Division shall be apportioned in the Holdings Partnership Division between such ~~Legacy~~ BGC Holding Unit, on the one hand, and ~~the Newmark Holdings Legacy Unit issued in the Holdings Partnership Division in respect of~~ such Legacy Unit, on the other hand, based on the Relative Value of BGC and Newmark, such that the sum of the HDII Account for such ~~Legacy~~ BGC Holdings Unit and ~~Newmark Holdings~~ Legacy Unit immediately following the Holdings Partnership Division shall equal the HDII Account for such ~~Legacy~~ BGC Holding Unit immediately prior to the Holdings Partnership Division. High Distribution II Units held as a result of modification of High Distribution Units shall, solely for purposes of this Section 12.01(a)(iii), be treated as issued on the date of such modification, except that such Units shall be treated as having been held by such Founding/Working Partner since the date the High Distribution Units were originally acquired (or, in the case of any Legacy Unit, the date on which the BGC Holdings Unit for which such Legacy Unit was issued in the Holdings Partnership Division was originally acquired) for purposes of determining the amount distributable to a holder of High Distribution II Units pursuant to Section 12.01(a)(iii)(J). (C) Each HDII Account shall be reduced, but not below zero (0), by (x) any cash contributed to the Partnership by a holder of High Distribution II Units and designated as an HDII Contribution, (y) any reduction in distributions to such Founding/Working Partner pursuant to Section 12.01(a)(iii)(G), 12.01(a)(iii)(H) or 12.01(a)(iii)(J), and (z) any amount contributed by a holder of High Distribution II Units pursuant to Section 9.05 to restore any negative balance in his, her or its Capital Account (all amounts referred to in (x), (y) and (z) shall be defined as “HDII Contributions”). (D) In the event that a Loss is allocated with respect to a Founding/Working Partner’s High Distribution II Units during any period, such Founding/Working Partner’s HDII Account shall be increased by the smaller of (x) the amount of such Loss and (y) the amount of such Founding/Working Partner’s HDII Special Allocation. (E) Pursuant to Section 2(k) of Exhibit D C to this Agreement, a portion of the items of loss or deduction of the Partnership for each period shall specifically be allocated to each Founding/Working Partner holding High Distribution II Units with a positive HDII Account. Such portion (the “HDII Special Allocation”) shall be equal to the product of (x) the balance of such HDII Account and (y) the rate mutually agreed by the Founding/Working Partner and the General Partner from time to time (the “HDII Special Allocation Rate”). Such HDII Special Allocation Rate may be fixed or established by formula. (F) A Founding/Working Partner’s HDII Account for each Unit must periodically be reduced to the level specified in a schedule mutually agreed by the Founding/Working Partner and the General Partner. If no schedule is agreed, the HDII Account shall be reduced by an amount sufficient so that the HDII Account is (w) no greater than 75% of its original value on the first December 15th after such Unit’s issuance; (x) no greater than 50% of its original value on the second December 15th after such Unit’s issuance; (y) no greater than 25% of its original value on the third December 15th after such Unit’s issuance; and (z) zero (0) on the fourth December 15th after such Unit’s issuance; provided, however, that any such December 15th date may be extended at the sole and absolute discretion of the General Partner to any later date in December of such year. To the extent that any HDII Account exceeds the relevant level set forth in the schedule or, if no schedule is agreed upon, the relevant level specified in the preceding sentence, such Founding/Working Partner’s HDII Account shall be reduced through adjustments to distributions pursuant to Section 12.01(a)(iii)(G) or 12.01(a)(iii)(H). Reductions required to be made pursuant to this Section 12.01(a)(iii)(F) shall be referred to as an “HDII Account Reduction Obligation.” With respect to any High Distribution II Unit that is a Legacy Unit, each relevant level set forth in the schedule contemplated by the first sentence of this Section 12.01(a)(iii)(F) or, if no schedule is agreed upon, each relevant level specified in the preceding sentence, shall be apportioned in the Holdings Partnership Division between such Legacy Unit, on the one hand, and the Newmark Holdings Legacy Unit issued in the Holdings Partnership Division in respect of such Legacy Unit, on the other hand, based on the Relative Value of BGC and Newmark, such that the sum of the applicable levels for such Legacy Unit and Newmark Holdings Legacy Unit immediately following the Holdings Partnership Division shall equal the applicable level for such Legacy Unit immediately prior to the Holdings Partnership Division. (G) Amounts distributable to any Founding/Working Partner holding High Distribution II Units for any period shall be reduced, but not below zero (0), by the amount of any HDII Account Reduction Obligation that has not previously been satisfied. To the extent that any HDII Account Reduction Obligation for any date exceeds the amount, if any, that would otherwise be distributed to such Founding/Working Partner within five (5) days of such date, after application of any withholding tax or other payments on behalf of such Founding/Working Partner pursuant to Section 5.09, such Founding/Working Partner shall be required to make additional HDII Contributions to the Partnership pursuant to Section 12.01(a)(iii)(C) in an amount equal to such excess. (H) The General Partner may reduce any distribution otherwise payable to any holder of High Distribution II Units by an amount not to exceed the HDII Account Reduction Obligation for any date during the fiscal year that includes such distribution. Such reduction shall be made after application of Section 12.01(a)(iii)(F). In applying this Section 12.01(a)(iii)(H), the General Partner may deem such Founding/Working Partner to have elected to receive a distribution equal to 100% of the General Partner’s estimate of the Partnership’s income and gain allocable to such Founding/Working Partner for such period. (I) Notwithstanding anything to the contrary contained in this Agreement, no additional Units shall be issued to a Founding/Working Partner holding High Distribution II Units as a result of any HDII Contribution occurring by way of cash contributions or reductions in amounts distributable to such Founding/Working Partner under Section 12.01(a)(iii)(G), 12.01(a)(iii)(H) or 12.01(a)(iii)(J). (J) In the event of the redemption of all or a portion of a Founding/Working Partner’s High Distribution II Units pursuant to Section 3.03, 9.02 or 12.05 or otherwise in accordance with this Agreement, the amount distributable to a Founding/Working Partner shall be reduced, but not below zero (0), by the HDII Account. In the event of the redemption of all of a Founding/Working Partner’s High Distribution II Units, the Founding/Working Partner’s HDII Account shall become immediately payable to the Partnership in full. In the event of the redemption of all or a portion of a Founding Partner’s High Distribution II Units, (x) an amount equal to the Founding Partner’s CFLP HDII Account with respect to such Units shall be paid to Cantor rather than being distributed to such Founding Partner on such date with respect to such Units and (y) if such High Distribution II Units called for redemption are purchased by Cantor pursuant to Section 12.02 or 12.03, the amount payable by Cantor to such Founding Partner or the Partnership for such Units shall be reduced by an amount equal to the Founding Partner’s CFLP HDII Account with respect to such Unit not theretofore paid by the Partner pursuant to this Section 12.01(a)(iii). (K) Any High Distribution II Unit that is designated as a Founding Partner Unit shall continue to have a CFLP HDII Account, CFLP HDII Special Allocation Rate and CFLP HDII Account Reduction Obligation (which amounts, for the avoidance of doubt, shall not be apportioned in or otherwise modified as a result of the Holdings Partnership Division), and the holder of such High Distribution II Unit shall satisfy its obligations to Cantor relating to such Unit by the application of any distributions that would be subject to reduction and any contributions that would be made by such holder under this Section 12.01(a)(iii), were such holder’s High Distribution II Unit to have an HDII Account, an HDII Special Allocation Rate and an HDII Account Reduction Obligation, equal to those it has to Cantor (and, in the case of any loss specially allocated to such holder by the Partnership reflecting the HDII Account Reduction Obligation it would have, an equivalent amount of income shall be allocated by the Partnership to Cantor). Any payment by a Partner to Cantor in respect of its CFLP HDII Account Reduction Obligation pursuant to this paragraph shall result in an increase in such Partner’s Capital Account in the Partnership (such payment to be treated, for purposes of maintaining Capital Accounts, as a capital contribution by such Partner to the Partnership and a distribution by the Partnership to Cantor). (L) Notwithstanding anything to the contrary contained in this Agreement, any Founding/Working Partner holding High Distribution II Units shall be required to make additional HDII Contributions to the Partnership by way of cash contributions and by reductions in amounts distributable to such Partner as provided in Sections 12.01(a)(iii)(G), 12.01(a)(iii)(H) and 12.01(a)(iii)(J). Such contributions must be made within five days of the General Partner notifying such holder of High Distribution II Units of its obligation hereunder. In the event that the required contribution is not made, the General Partner may, in its sole and absolute discretion, redeem all or a portion of such Founding/Working Partner’s High Distribution II Units, declare the High Distribution Unit II Unitholder to be in default under this Agreement, or take any other action available to it at law or in equity to enforce the obligation described in this Section 12.01(a)(iii)(L), including seeking enforcement of such obligation in any forum and in any jurisdiction (and each holder of High Distribution II Units hereby irrevocably submits to the jurisdiction of any such forum or jurisdiction), notwithstanding the jurisdictional provisions contained in Section 13.04, including the payment of legal fees and expenses related thereto. Any Partner not making a required contribution shall pay interest to the Partnership at a rate determined by the General Partner, and such interest payments shall not be treated as capital contributions hereunder or as part of such Partner’s Capital Account.15th

Appears in 1 contract

Samples: Partnership Agreement (Newmark Group, Inc.)

Common use of High Distribution II Units Clause in Contracts