DECADE COMPANIES INCOME PROPERTIES - A LIMITED PARTNERSHIP
AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
THIS AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
(the "Agreement") is entered into this 30th day of September,
1996, among Decade Companies, a Wisconsin general partnership, as
the General Partner (the "General Partner"), and Xxxxxxx
Xxxxxxxxxx, as the Initial Limited Partner (the "Initial Limited
Partner"), and those Persons who have and shall become Limited
Partners pursuant to this Agreement, and amends and restates the
Amended and Restated Agreement of Limited Partnership of Decade
Companies Income Properties - A Limited Partnership previously
entered into among the parties hereto as of February 20, 1987.
NOW, THEREFORE, in consideration of the mutual promises made
herein, the parties hereby form a limited partnership (the
"Partnership") and agree as follows:
ARTICLE I
FORMATION OF LIMITED PARTNERSHIP
The General Partner and the Initial Limited Partner hereby
form a limited partnership pursuant to the laws of the State of
Wisconsin. The partners shall from time to time execute or cause
to be executed all such certificates or other documents or cause to
be done all such filing, recording, publishing or other acts as may
be necessary or appropriate to comply with the requirements for the
formation and the operation of a limited partnership under the laws
of Wisconsin for the purpose of establishing and protecting the
limited liability of the Limited Partners.
ARTICLE II
NAME, PURPOSE, PLACE OF BUSINESS AND TERM OF PARTNERSHIP
2.1. Name. The name of the Partnership shall be Decade
Companies Income Properties - A Limited Partnership.
2.2. Purpose and Objectives. The purpose and business of the
Partnership shall be to conduct market studies of sites suitable
for the development of real estate or sites of existing improved
real estate (all such real estate together with any ancillary
personal property, herein called "Property") for possible
acquisition by the Partnership, to primarily invest in Property
located in the State of Florida, although Property situated
anywhere in the continental United States may be acquired and to
acquire, hold, lease or operate, sell, finance, refinance, dispose
of and otherwise invest and/or reinvest in and deal with such
Property, and to engage in any other activities incidental thereto.
The Partnership may also make equity-participating and other loans
on income-producing Properties that are secured by first or junior
mortgage liens. Properties will be purchased and/or mortgage
loans, if any, will be made for long-term investments in any
area(s) where, in the opinion of the General Partner, the
opportunities appear to be favorable to the Partnership. The
Partnership shall not engage in any other business or activity.
Its principal objectives in making investments in Property are, in
the order of priority to (1) preserve and protect the Limited
Partners' capital investment, (2) provide for quarterly
distributions of Cash Available for Distribution beginning 30 days
after Commencement of Operations, a portion of which during the
early years of the Partnership's existence is expected to be
sheltered from income taxes, and (3) provide capital appreciation
through increases in value of the Partnership's real estate assets
or in the case of any mortgage loans, provide increased cash
distributions and/or capital appreciation through participation in
any increased value of Properties as to which loans are made.
2.3. Place of Business. The principal place of business of
the Partnership shall be at Brookfield Lakes Corporate Center, 000
Xxxxxxx Xxxxxxxxx, Xxxxxxxxxx, Xxxxxxxxx 00000-0000. The General
Partner may establish other places of business of the Partnership,
as required by the Partnership's business.
2.4. Term. The term of the Partnership shall commence as of
the date of the filing of the Certificate of Limited Partnership
pursuant to the Wisconsin Uniform Limited Partnership Act and shall
continue until December 31, 2005, unless the Partnership is sooner
dissolved or terminated as provided in this Agreement.
ARTICLE III
DEFINED TERMS
Unless defined elsewhere in this Agreement, the terms used
herein and elsewhere in the Prospectus to which this Agreement is
an exhibit shall have the meanings set forth below:
3.1. Acquisition Expenses - Expenses including but not
limited to legal fees and expenses, travel and communications
expenses, costs of appraisals, non-refundable option payments on
Property not acquired, accounting fees and expenses, title
insurance and miscellaneous expenses related to selection and
acquisition of Properties, whether or not acquired.
3.2. Acquisition Fee - The total of all fees and commissions
paid by any party in connection with the making or investing in
mortgage loans or the purchase or development of Property by the
Partnership except a development fee paid to a Person not
affiliated with the General Partner in connection with the actual
development of a project after acquisition of land by the
Partnership. Included in the computation of such fees or
commissions shall be any real estate commission, selection fee,
development fee, nonrecurring management fee or any fee of a
similar nature, however designated.
3.3. Affiliate - (1) any Person directly or indirectly
controlling, controlled by, or under common control with another
Person; (2) any Person owning or controlling 10% or more of the
outstanding voting securities of such other Person; (3) any
officer, director, or partner of such Person; and (4) if such other
Person is an officer, director, or partner, any company for which
such Person acts in any such capacity.
3.4. Appraised Value - Value according to an appraisal made
by an independent qualified appraiser.
3.5. Audited Financial Statements - Financial statements
(balance sheet, statement of income, statement of Partners' equity,
and statement of cash flow) prepared in accordance with generally
accepted accounting principles and accompanied by an auditor's
report containing an unqualified opinion or an opinion containing
no material qualification of an independent certified public
accountant or independent public accountant.
3.6. Capital Account - With respect to any partner, the
capital account maintained for such Person in accordance with
Sections 5.4 - 5.6 of the Partnership Agreement.
3.7. Capital Investment - As of any day, a Limited Partner's
Original Capital Contribution, reduced by all prior distributions
of Net Sales Proceeds to such Limited Partner. In the event any
Person transfers all or any portion of its Interests in accordance
with the terms of this Partnership Agreement, the transferee shall
succeed to the Capital Investment of the transferor to the extent
it relates to the transferred Interests. The Capital Investment of
a Limited Partner for any year of Partnership operations shall be
calculated as the average of the Capital Investment of the Limited
Partner during such year.
3.8. Cash Available for Distribution - Cash Flow less amounts
set aside for Reserves, through 1988, plus the amount of any
General Partner's Loan for such period.
3.9. Cash Flow - The Partnership's cash funds provided from
operations and Reserves, including lease payments on net leases
from builders and sellers, without deduction for depreciation, but
after deducting cash funds used to pay all Operating Expenses,
deferred fees, other expenses, debt payments, capital improvements,
and replacements.
3.10. Code - The Internal Revenue Code of 1986, as amended.
3.11. Commencement of Operations - The date on which
subscription payments for an aggregate of 1,175 Interests
($1,175,000) have been received from at least 100 investors and
such funds are released from escrow to the Partnership.
3.12. Competitive Real Estate Commission - That real estate
or brokerage commission paid for the purchase or sale of Property
which is reasonable, customary, and competitive in light of the
size, type, and location of the Property.
3.13. Consent - Either (i) the consent given by vote at a
meeting called and held in accordance with the provisions of this
Agreement, (ii) a prior written consent required or permitted to be
given pursuant to this Agreement, or (iii) in connection with a
proposed transaction which is intended to result in Net Cash
Proceeds or the proposed dissolution of the Partnership, a failure
to object in writing to the transaction within fifteen (15) days of
receipt of notification of such proposed transaction.
3.14. Cumulative Preference - An amount equal to 10% per
annum cumulative of the Capital Investment of the Limited Partners
from the date of their admission to the Partnership as adjusted for
prior distributions to the Limited Partners of Cash Available for
Distribution.
3.15. Custodian Bank - The Associated Commerce Bank in
Milwaukee, Wisconsin.
3.16. Depreciation - With respect to each fiscal year or
other period, an amount equal to the depreciation, amortization, or
other cost recovery deduction allowable with respect to an asset of
the Partnership for such fiscal year or other period, except that
if the Fair Asset Value of a Partnership asset differs from its
adjusted basis for federal income tax purposes at the beginning of
such fiscal year or other period, Depreciation shall be an amount
which bears the same ratio to such beginning Fair Asset Value as
the depreciation, amortization or other cost recovery deduction for
federal income tax purposes for such fiscal year or other period
bears to such beginning adjusted tax basis.
3.17. Development Fee - A fee for the packaging of the
Partnership's Property, including negotiating and approving plans,
and undertaking to assist in obtaining zoning and necessary
variances and necessary financing for the specific Property, either
initially or at a later date.
3.18. Escrow Agreement - Agreement entered into by and
between the Partnership and the Associated Commerce Bank,
Milwaukee, Wisconsin whereby funds paid by subscribers are escrowed
with said bank (1) pending receipt of initial subscriptions for at
least 1,175 Interests from at least 100 investors, and (2) with
respect to funds received in connection with subscriptions for more
than 15,000 Interests, pending receipt of majority Consent
authorizing the sale of a total of 18,000 Interests by the
Partnership.
3.19. Fair Asset Value - With respect to any Partnership
asset, the asset's adjusted basis for federal income tax purposes.
Notwithstanding the foregoing:
A. The initial Fair Asset Value of any asset
contributed by a partner to the Partnership shall be the gross
fair market value of such asset as determined by the
contributing partner and the Partnership.
B. The Fair Asset Value of all Partnership assets shall
be adjusted to equal their respective gross fair market value,
as determined by the General Partner, as of the times set
forth in Section 5.5 hereof.
C. If the Fair Asset Value of an asset of the
Partnership has been determined or adjusted pursuant to this
Partnership Agreement, such Fair Asset Value shall,
thereafter, be adjusted by the Depreciation taken into account
with respect to such asset for purposes of computing Profits
and Losses.
3.20. Front-End Fees - The fees and expenses paid to any
party for any services rendered during the Partnership's
organizational and acquisition phases, including Organizational and
Offering Expenses, Acquisition Fees, Acquisition Expenses, and any
similar fees, however designated including in the case of any
mortgage loans, Mortgage Placement and Mortgage Brokerage Fees.
Organizational and Offering Expenses are those expenses incurred in
connection with and in preparing the Partnership for registration
and subsequently offering and distributing it to the public,
including sales commissions paid to broker-dealers in connection
with the distribution of Interests and all advertising expenses.
Acquisition Fees are all fees and commissions paid by any party in
connection with the purchase or development of Property by the
Partnership, except a Development Fee paid to a Person not
affiliated with a sponsor in connection with the actual development
of a project after acquisition of the land by the Partnership.
Included in the computation of such fees or commissions shall be
any real estate commission, selection fee, nonrecurring management
fee, or any fee of a similar nature, however designated.
Acquisition Expenses are all legal fees and expenses, travel and
communication expenses, cost of appraisals, non-refundable option
payments on Property not acquired, accounting fees and expenses,
title insurance, and miscellaneous expenses related to selection
and acquisition of Properties, whether or not acquired.
3.21. General Partner - Decade Companies, a Wisconsin general
partnership of which Xxxxxxx Xxxxxxxxxx and Decade 80, Inc. are co-
general partners.
3.22. General Partner's Loan - The sum of all quarterly
advances by the General Partner to the Partnership to make Net
Interest on Partnership Subscriptions for subscriptions for more
than 15,000 Interests equal 8.5% for all funds escrowed pending
receipt of majority Consent authorizing the sale of a total of
18,000 Interests, and to make Cash Available for Distribution to
the Limited Partners equal to an annualized rate of 8.25% of
Original Capital Contributions for the first 360-day period, 8.5%
for the second 360-day period, and 9% for the third 360-day period,
to a maximum of 3% of gross proceeds of the offering, with interest
at the minimum annual rate required by the Code to avoid the
imposition of imputed interest under the Code and not to exceed the
cost of such funds to the General Partner. The General Partner's
Loan shall be repaid with interest, from net cash receipts and Sale
Proceeds. The period during which such annualized payment rates
shall be paid shall commence 30 days after Commencement of
Operations or, in the case of advances relating to interest applied
to subscription funds received in connection with the sale of the
last 3,000 Interests, 30 days after majority vote is received
authorizing the sale of the last 3,000 Interests.
3.23. Investment in Properties - The amount of the Original
Capital Contributions actually paid or allocated to the purchase,
development, construction, or improvement of Properties acquired by
the Partnership (including the purchase of Properties, Reserves of
up to 5% of gross offering proceeds, and other cash payments such
as interest and taxes but excluding Front-End Fees).
3.24. Limited Partners - All Persons admitted to the
Partnership who shall make an Original Capital Contribution and who
agree to be bound by the provisions of the Partnership Agreement,
by executing a counterpart of the Partnership Agreement and such
other instruments, including a Subscription Agreement and a power-
of-attorney, as the General Partner may require, as well as any
parties admitted as substituted Limited Partners, as well as any
assignee thereof, except that with respect to any voting rights,
assignees will not be deemed to be Limited Partners unless they
have been admitted as substituted Limited Partners.
3.25. Limited Partnership or Partnership - Decade Companies
Income Properties - A Limited Partnership.
3.26. Limited Partnership Interest or Interest - The unit or
other indicia of ownership in this Partnership represented by an
Original Capital Contribution of $1,000 (or such lesser amount as
reflects the reduction or elimination of sales commissions on sales
to employees of Decade Companies or Affiliates or volume
discounts).
3.27. Managing Dealer - Decade Securities Corp., an Affiliate
of the General Partner.
3.28. Minimum Gain - For any fiscal year or other period,
with respect to each nonrecourse liability of the Partnership, the
amount of gain (of whatever character), if any, that would be
realized by the Partnership if the Partnership disposed of the
Property that is subject to or secures the nonrecourse liability in
full satisfaction of such liability in a taxable transaction, and
then by aggregating the amounts so computed for all such Property
of the Partnership and otherwise determined pursuant to paragraph
(b)(4)(iv)(c) of Treas. Regs. sec. 1.704-1. For this purpose,
"nonrecourse liability" means a liability of the Partnership with
respect to which no partner has personal liability determined in
accordance with Section 752 of the Code and the treasury
regulations promulgated thereunder.
3.29. Mortgage Brokerage Fee - The fee payable to the General
Partner in an amount equal to 0.25% of the principal amount of any
mortgage loan made by the Partnership for services rendered in
locating potential borrowers and investigating their
creditworthiness.
3.30. Mortgage Placement Fee - The fee payable to the General
Partner in an amount equal to 3% of the principal amount of any
mortgage loan made by the Partnership for services rendered in
connection with the analysis, negotiation and documentation of any
such mortgage loans, as well as for the administration of the
Partnership's interest in the mortgage loans including the timely
collection of amounts due thereunder from borrowers and
verification of the borrowers' continued compliance with other
conditions of the mortgage loans.
3.31. NASAA Guidelines - The North American Securities
Administrators Association Guidelines regarding real estate
programs effective January 1, 1986.
3.32. Net Capital Account - The aggregate initial investment
represented by an Interest (i) reduced by (A) any Losses allocated
to such Interest and (B) any distributions of cash, and (ii)
increased by any Profits allocated to such Interest.
3.33. Net Interest on Partnership Subscriptions - Interest,
dividends, and other amounts earned on subscription funds placed in
the escrow account described in the Prospectus. Net interest on
funds held in escrow until Commencement of Operations will include
an amount from the Partnership if and to the extent that actual
interest earnings from escrowed funds are less than 12% per annum.
Net interest on funds received in connection with subscriptions for
the final 3,000 Interests and held in escrow pending receipt of
majority Consent for the sale of the last 3,000 Interests will
include an amount from the Partnership if and to the extent that
actual interest earnings are less than 8.5% per annum. Whether or
not the Partnership commences operations or receives majority
Consent, the General Partner will make an additional capital
contribution to the Partnership to the extent necessary to permit
the Partnership to make the payments specified herein.
3.34. Net Sale Proceeds - Sale Proceeds less any amounts
required to repay any General Partner's Loan and any deferred fees
to the General Partner and/or Affiliates.
3.35. Net Worth - The excess of total assets over total
liabilities as determined by generally accepted accounting
principles except that if any of such assets have been depreciated,
then the amount of depreciation relative to any particular asset
may be added to the depreciated cost of such asset to compute total
assets, provided that the amount of depreciation may be added only
to the extent that the amount resulting after adding such
depreciation does not exceed the fair market value of such asset.
3.36. Non-Specified Property Program - A program where, at
the time a securities qualification is ordered effective, less than
75% of the net proceeds from the sale of program Interests is
allocable to the purchase, construction or improvement of specific
Properties, or a program in which the proceeds from any sale or
refinancing of Properties may be reinvested. Reserves shall be
included in the non-specified 25%.
3.37. Operating Expenses - Partnership cash disbursed in the
ordinary course of operating the Partnership's business, including,
without limitation, expenses of advertising and promotion, Property
management, utilities, repair and maintenance, computer time-
sharing, accounting, statistical or bookkeeping services or
accounting, equipment use, printing and mailing of reports and
communications to Limited Partners or others, travel on Partnership
business, and long-distance telephone expenses, but as to any
payments to the General Partner or Affiliates, only within the
limits provided under "MANAGEMENT-Reimbursable Expenses" as set
forth in the prospectus, dated January 31, 1986, as amended or
supplemented from time to time.
3.38. Organizational and Offering Expenses - Those expenses
incurred in connection with the formation, qualification, and
registration of the Partnership and in marketing, distributing, and
processing Interests under applicable federal and state securities
laws, and any other expenses actually incurred and directly related
to the offer and sale of Interests.
3.39. Original Capital Contribution - An amount equal to the
product of (a) the number of Interests owned by a Limited Partner
and (b) $1,000.
3.40. Partnership Agreement - The Limited Partnership
Agreement by and between the General and Limited Partners as
amended from time to time.
3.41. Person - Any natural person, partnership, corporation,
association, or other legal entity.
3.42. Priority Return - An amount equal to six percent (6%)
per annum, cumulative, but not compounded (prorated for any partial
year) of the Capital Investment of all the Limited Partners, from
time to time, during the period to which the Priority Return
relates, commencing on the first day a Limited Partner is admitted
to the Partnership pursuant to Section 4.3 hereof.
3.43. Profits and Losses - For each fiscal year or other
period, an amount equal to the Partnership's taxable income or loss
for such year or period, determined in accordance with Section
703(a) of the Code (for this purpose, all items of income, gain,
loss or deduction required to be stated separately pursuant to
Section 703(a)(1) of the Code shall be included in taxable income
or loss), with the following adjustments:
A. Any income of the Partnership that is exempt from
federal income tax and not otherwise taken into account in
computing profits or losses shall be added to such taxable
income or loss;
B. Any expenditures of the Partnership described in
Section 705(a)(2)(B) of the Code or treated as Section
705(a)(2)(B) of the Code expenditures pursuant to Treas. Regs.
Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into
account in computing profits or losses shall be subtracted
from such taxable income or loss;
C. Gain or loss resulting from the disposition of
Property of the Partnership with respect to which gain or loss
is recognized for federal income tax purposes shall be
computed by reference to the Fair Asset Value of the Property
disposed of, notwithstanding that the adjusted basis of such
Property for income tax purposes differs from its Fair Asset
Value;
D. In lieu of the depreciation, amortization and other
cost recovery deductions taken into account in computing such
taxable income or loss, there shall be taken into account
Depreciation for such fiscal year or other period computed in
accordance with Section 3.16; and
E. Notwithstanding any other provision of this
Partnership Agreement, any items which are specially allocated
pursuant to Sections 6.9 or 6.10 hereof shall not be taken
into account in computing profits or losses.
3.44. Property Management Fee - The fee paid for day-to-day
professional property management services in connection with the
Partnership's Properties.
3.45. Prospectus - The final prospectus included in the
Partnership's Registration Statement filed with the Securities and
Exchange Commission, pursuant to which the Partnership will offer
Interests to the public, as the same may be amended or supplemented
from time to time.
3.46. Purchase Price of Property - The price paid upon the
purchase or sale of a particular Property, including the amount of
Acquisition Fees and all liens and mortgages on the Property, but
excluding points and prepaid interest.
3.47. Qualified Plans - IRA's, stock bonus plans, and
qualified pension/profit-sharing plans (including plans formerly
known as Xxxxx'x and H.R. 10 Plans) as defined in the Employee
Retirement Income Security Act of 1974 ("ERISA").
3.48. Repurchase Pool - An amount equal to up to two percent
of the gross proceeds of the offering, which will be available for
use by the Partnership, in the sole discretion of the General
Partner, to repurchase a limited number of Interests at negotiated
prices.
3.49. Reserves - Such amounts set aside at the reasonable
discretion of the General Partner to pay for repairs, maintenance,
improvements, or contingent or unforeseen liabilities or obliga-
tions which the General Partner deems necessary or appropriate for
the operation and protection of the Partnership, including amounts
allocated to the Repurchase Pool.
3.50. Sale Proceeds or Sales Proceeds- All cash funds
resulting from a sale or refinancing of Partnership Property, plus
established Reserves, less: (a) expenses incurred in the
transaction; (b) debts and obligations related to the transaction;
and (c) other payments for Partnership expenses (not including fees
deferred by the General Partner and Affiliates), costs of
improvements or additions to Properties and amounts as may be
required to purchase underlying land or joint venture interests or
Reserves established by the General Partner.
3.51. Soliciting Dealers - Broker-dealers that are members of
the National Association of Securities Dealers, Inc., and that
enter into a soliciting dealer agreement with the Managing Dealer.
3.52. Syndication Expenses - All expenditures of the
Partnership properly classified as syndication expenses under
paragraph (b) of Treas. Regs. sec. 1.709-2. Syndication Expenses shall
be taken into account under this Partnership Agreement at the time
they would be taken into account under the Partnership's method of
accounting if they were deductible expenses for federal income tax
purposes.
3.53. Underwriting Fee - The fee payable to the Managing
Dealer for marketing incentives, offering expense reimbursements,
and due diligence expenses.
ARTICLE IV
NAMES AND ADDRESSES OF PARTNERS AND CAPITAL CONTRIBUTIONS
4.1. General Partner. The name of the General Partner is
Decade Companies, a general partnership. The address of the
General Partner is Brookfield Lakes Corporate Center, 000 Xxxxxxx
Xxxxxxxxx, Xxxxxxxxxx, Xxxxxxxxx 00000-0000. The General Partner
shall make an initial capital contribution to the Partnership of
$100.
4.2. Initial Limited Partner. Xxxxxxx Xxxxxxxxxx shall be
the Initial Limited Partner. The Initial Limited Partner shall
make a capital contribution to the Partnership of $10. The address
of the Initial Limited Partner at the time of subscription is 0000
Xxxxx 000xx Xxxxxx, Xxx. 000, Xxxxxxxxx, Xxxxxxxxx 00000. At the
time the minimum number of Interests is sold to Limited Partners
and those Limited Partners are admitted to the Partnership, the
Initial Limited Partner shall withdraw from the Partnership or in
the event of the Partnership's failure to achieve the minimum
capitalization required for release of the escrowed funds, his
capital contribution of $10 shall be returned.
4.3. Limited Partners. The Original Capital Contribution of
the Limited Partners, other than the Initial Limited Partner, shall
be made in cash in the amount of $1,000 for each Interest acquired
and shall be in the minimum amount of $3,000 (3 Interests), $25,000
(25 Interests subject to reduction in the discretion of the General
Partner) in the case of a pension/profit-sharing plan (including
plans formerly known as Xxxxx Plans or H.R. 10 Plans), $2,000 (2
Interests) in the case of an XXX, and thereafter in $1,000
increments. Notwithstanding the foregoing, an XXX or a
pension/profit-sharing plan (including plans formerly known as
Xxxxx Plans or H.R. 10 Plans) and Limited Partners participating in
the Reinvestment Plan may make an additional investment of
fractional Interests in $10 increments. Limited Partners shall be
admitted to the Partnership upon acceptance and unrestricted
receipt by the Partnership of their Original Capital Contributions.
4.4. Liability of Partners.
A. No Limited Partner shall be liable for the debts,
liabilities, contracts or other obligations of the Partnership. A
Limited Partner shall be liable only to make his Original Capital
Contribution and shall not be required to loan any funds to the
Partnership or, after his capital contribution shall have been
paid, to make any further capital contribution to the Partnership.
B. The General Partner shall have no personal liability for
the repayment of the capital contribution of any Limited Partner or
for repayment to the Partnership of any portion or all of any
negative balance in any Limited Partner's Capital Account.
ARTICLE V
CAPITAL OF THE PARTNERSHIP
5.1. No Interest on Capital Contributions. Except for those
who make capital contributions prior to the Commencement of
Operations or, as provided in this Partnership Agreement with
respect to subscriptions for the final 3,000 Interests, no partner
shall be paid interest on any Capital Contribution.
5.2. Treatment of Capital Contributions. The Partnership
shall not be required to redeem or repurchase any Interests and no
partner shall have the right to withdraw, or receive any return of,
his capital contribution, and no capital contribution may be
returned in the form of Property other than cash, except as
specifically provided in this Agreement.
5.3. Capital Accounts and Contributions to Capital. A
Capital Account shall be established for each partner on the books
and records of the Partnership. The Partnership is authorized to
raise capital by offering and selling a minimum of 1,175 Interests,
representing Original Capital Contributions of $1,175,000, and a
maximum of 10,000 Interests, representing Original Capital
Contributions of $10,000,000, subject to the offering and sale of
up to 18,000 Interests ($18,000,000) at the General Partner's
option. No sale of less than 3 Interests representing an Original
Capital Contribution of $3,000, 25 Interests representing an
Original Capital Contribution of $25,000 in the case of a
pension/profit-sharing plan, or 2 Interests representing an
Original Capital Contribution of $2,000 in the case of an XXX,
shall be made to any Person. The General Partner and/or Affiliates
may purchase in the aggregate up to 20% of the total Interests to
be sold by the Partnership. Pending the receipt of subscriptions
for the minimum number of Interests to be sold, and pending receipt
of majority vote authorizing the sale of 3,000 additional
Interests, all subscription proceeds, together with related
subscription documents, shall be deposited and held in trust by an
unaffiliated, unrelated escrow agent pursuant to an Escrow
Agreement. The escrow shall be terminated upon receipt of majority
vote and upon compliance with all other conditions of the Escrow
Agreement. If the minimum number of Interests is not subscribed
for by the last day of the twelfth month following the effective
date of a registration statement filed with the Securities and
Exchange Commission relating to the public sale of Interests (or
such extended date, not later than the last day of the twenty-
fourth month following the effective date of the registration
statement), or if majority vote is not attained, the escrow shall
terminate and all subscription proceeds and related subscription
documents shall be returned to subscribers, together with interest
as may be provided in the Escrow Agreement. All Net Interest on
Partnership Subscriptions shall inure to the benefit of the
partners who invest prior to the actual Commencement of Operations
and, in connection with the sales of the last 3,000 Interests,
those who invest before the Partnership acquires majority vote. If
the actual interest earned on such escrowed subscriptions is less
than that specified in Section 3.33, the General Partner will
contribute sufficient capital to bring the Net Interest on
Partnership Subscriptions to the amounts specified in Section 3.33.
5.4. Establishment and Maintenance of Capital Accounts.
A. A partner's Capital Account shall be increased by (i) the
amount of money contributed by such partner to the Partnership,
(ii) the Fair Asset Value of Property contributed by such partner
to the Partnership (net of liabilities securing such contributed
Property that the Partnership is considered to assume or take
subject to under Section 752 of the Code), and (iii) the
allocations to such partner of Partnership Profits including items
in the nature of income and gain that are specially allocated
pursuant to Section 6.9 hereof; and decreased by (iv) the amount of
money distributed to such partner by the Partnership, (v) the Fair
Asset Value of Property distributed to such partner by the
Partnership (net of liabilities securing such distributed Property
that the partner is considered to assume or take subject to under
Section 752 of the Code), (vi) allocations to such partner of any
items in the nature of expenses and losses that are specially
allocated pursuant to Section 6.10 hereof; and (vii) allocations to
such partner of Partnership Loss; and otherwise adjusted in
accordance with the additional rules set forth in paragraph
(b)(2)(iv) of Treas. Regs. sec. 1.704-1.
B. A partner who has more than one Interest in the
Partnership shall have a single Capital Account that reflects all
such Interests, regardless of the class of Interests owned by such
partner (e.g., general or limited) and regardless of the time or
manner in which such Interests were acquired.
C. It is the intent of the partners that Capital Accounts be
maintained at all times in strict accordance with the rules
governing maintenance of capital accounts set forth in Treas.
Regs. sec. 1.704-1(b)(2)(iv). In the event the General Partner shall
determine that it is prudent to modify the manner in which the
Capital Accounts, or any increases or decreases thereto, are needed
in order to comply with the requirements of Treas. Regs. sec. 1.704-
1(b), the General Partner may make such modification, provided it
is not likely to have a material effect on the amounts
distributable to a partner pursuant to Article XI hereof upon the
dissolution of the Partnership.
D. A partner's Capital Account may have a negative balance
resulting from the adjustments described herein, but no partner
shall be required to make up a deficiency in his or its Capital
Account except as specifically provided in this Agreement.
5.5. Restatement of Capital Accounts. The Capital Accounts of
the partners shall be restated to reflect a revaluation of
Partnership Property on the Partnership's books upon the happening
of any of the following events:
A. A contribution of money or other Property by an existing
partner or by a new partner (other than a de minimis amount) as
consideration for an additional Interest in the Partnership.
B. A distribution of Property, other than money, (other than
a de minimis amount) by the Partnership unless all partners receive
simultaneous distributions of individual interests in the
distributed Property in proportion to their Interests.
C. The termination of the Partnership for federal income tax
purposes pursuant to Section 708(b)(1)(B) of the Code.
D. If the Capital Accounts of the partners are restated to
reflect a revaluation of Partnership Property on the Partnership's
books, the following rules shall be observed:
(i) The adjustments shall be based on the fair market
value of such Partnership Property (taking Section 7701(g) of
the Code into account) on the date of adjustment.
(ii) The adjustments shall reflect the manner in which
the unrealized income, gain, loss or deduction inherent in
such Property (that has not been reflected in the Capital
Accounts previously) would be allocated among the partners if
there were a taxable disposition of such Property (taking
Section 7701(g) of the Code into account) for such fair market
value on that date.
5.6. Carryover of Capital Account Upon Transfer of Partner-
ship Interest. Upon transfer of all or a part of an Interest, the
Capital Account of the transferor that is attributable to the
transferred Interest shall carry over to the transferee partner.
Notwithstanding the preceding sentence, if the transfer of an
Interest in the Partnership causes a termination of the Partnership
under Section 708(b)(1)(B) of the Code, the Capital Account that
carries over to the transferee partner will be adjusted in
accordance with paragraph (b)(2)(iv)(e) of Treas. Regs. sec. 1.704-1
in connection with the constructive liquidation of the Partnership
under paragraph (b)(1)(iv) of Treas. Regs. sec. 1.708-1. The
constructive reformation of the Partnership shall, for purposes of
Sections 5.4 and 5.6 only, be treated as the formation of a new
partnership and the Capital Accounts of the partners will be
determined and maintained accordingly.
ARTICLE VI
DISTRIBUTIONS OF CASH AND ALLOCATIONS OF PROFIT AND LOSS
6.1. Distributions of Cash Available for Distribution.
A. Cash Available for Distribution will be distributed 99%
to the Limited Partners (in the aggregate) and 1% to the General
Partner. If the General Partner contributes in excess of 1% of the
Partnership's capital, then the General Partner's interest in Cash
Available for Distribution will be equal to the percentage
contributed.
B. An Interest holder's right to participate in distribu-
tions of Cash Available for Distribution shall accrue from the date
of Commencement of Operations or the date his subscription is
accepted by the General Partner, whichever is later. Such
distributions shall be made within 30 days of the end of the
calendar quarter in which such Cash Available for Distribution
became available beginning 30 days after Commencement of
Operations.
C. Distributions of Cash Available for Distribution to the
Limited Partners shall be made to the Persons recognized as Limited
Partners during the fiscal quarter with respect to which such
distribution is made in proportion to the number of Interests held
on the last day of the quarter for which such Persons were
recognized as Limited Partners.
6.2. Distributions of Net Sales Proceeds.
A. Except as otherwise provided in Section 10.2 hereof, Net
Sales Proceeds will be distributed in the following order of
priority:
(i) First, to the Limited Partners until their Capital
Investments are reduced to zero (0);
(ii) Second, to the Limited Partners, an amount equal to
the excess, if any, of (a) the cumulative Priority Return from
the date of admission into the Partnership to the end of the
calendar quarter preceding the quarter during which such
distribution is made, over (b) the sum of all prior
distributions to the Limited Partners of Cash Available for
Distribution and Net Sales Proceeds to the extent that prior
distributions of Net Sales Proceeds exceed Original Capital
Contributions;
(iii) Third, to the General Partner, an amount equal to
the greater of (a) the excess of its initial capital
contribution over the sum of all prior distributions of Net
Sales Proceeds to the General Partner, or (b) one percent (1%)
of the Net Sales Proceeds;
(iv) Fourth, in the case of the sale of any Property as
to which brokerage services are actually performed by the
General Partner or an Affiliate, then an amount to the General
Partner or an Affiliate equal to one-half of the Competitive
Real Estate Commission for the Property being sold and for all
Properties previously sold, to the extent the General Partner
or Affiliates have not previously received such amounts with
respect to previously sold Properties (the aggregate amount
received by the General Partner or Affiliates pursuant to this
clause, shall not exceed the lesser of (a) three percent (3%)
of the gross Sales Proceeds from the sale of Properties, or
(b) one-half of the Competitive Real Estate Commission and
amounts paid by the Partnership to all Persons on real estate
brokerage commissions in connection with the sale of
Properties shall not exceed six percent (6%) of aggregate
gross Sales Proceeds);
(v) Fifth, eighty-eight percent (88%) of the remaining
Net Sales Proceeds to the Limited Partners;
(vi) Sixth, if, after all of the distributions of Net
Sales Proceeds pursuant to Sections 6.2 A. (i)-(iv), the
Limited Partners have not received their Capital Investment
plus a Cumulative Preference of ten percent (10%) per annum on
their Capital Investment, then, to the Limited Partners, an
amount equal to the amount of such deficiency in such return;
and
(vii) The balance, if any, to the General Partner, which
amount shall not exceed twelve percent (12%) of the remaining
Net Sales Proceeds after distributions of Net Sales Proceeds
pursuant to Sections 6.2 A. (i)-(iv).
B. Any Sales Proceeds distributed to Limited Partners shall
be distributed to those Persons recognized as Limited Partners on
the date of the transaction producing the Sales Proceeds in
proportion to the number of Interests held by such Persons on such
date.
6.3. Payments of Net Interest on Partnership Subscriptions.
Within 30 days following the date on which the requirements of the
Escrow Agreement are met (the "Commencement of Operations"), or
with respect to subscriptions for the final 3,000 Interests, before
receipt of majority vote, the Limited Partners whose subscriptions
have been accepted by the General Partner as of the Commencement of
Operations or before receipt of majority vote will be paid 100% of
the Net Interest on Partnership Subscriptions. Each such Limited
Partner shall receive a percentage of the total amount of Net
Interest on Partnership Subscriptions proportionate to the amount
of his investment in the Partnership as of the Commencement of
Operations or receipt of majority vote and the number of days his
subscription funds were held in escrow. Any portion of Net
Interest on Partnership Subscriptions in excess of amounts earned
on escrowed funds shall be paid by the Partnership from the
additional capital contribution of the General Partner.
6.4. Profits and Losses from Operations.
A. Except as otherwise provided in Sections 6.5, 6.7, 6.8
and 6.12 hereof, Profits and Losses (exclusive of those from the
sale or disposition of Partnership Property) shall be allocated 99%
to the Limited Partners and 1% to the General Partner, such Profits
and Losses to be determined on the same basis as for Partnership
income tax purposes. If the General Partner contributes in excess
of 1% of the Partnership's capital, then the General Partner's
interest in Profits and Losses will be equal to the percentage
contributed.
B. Profits and Losses from operations allocated to Limited
Partners shall be apportioned among all Persons who were Limited
Partners during the fiscal year, in proportion to the number of
Interests held and the number of days during the fiscal year for
which each was recognized as a Limited Partner. Except as set
forth elsewhere in the Agreement, transferees of Interests will be
recognized as the holders thereof not later than the first day of
the second month following the month in which the General Partner
received notice of the transfer.
6.5. Profits and Losses from Sale of Property.
A. Except as otherwise provided in Section 6.7 hereof if
there is a net Profit from the sale or other disposition of
Partnership Property, such net Profit shall be allocated, as
follows:
(i) First, ninety-nine percent (99%) to the Limited
Partners and one percent (1%) to the General Partner until the
cumulative Profits allocated pursuant to this Section 6.5 A.
(i) are equal to the total Losses allocated pursuant to
Section 6.5 B. for all prior periods;
(ii) Second, to the Limited Partners until the cumulative
Profits allocated pursuant to this Section 6.5 A. (ii) are
equal to the sum of (a) the Syndication Expenses for the
current year and all prior fiscal years; (b) the Losses
allocated pursuant to Section 6.10 hereof for the current and
all prior fiscal years; and (c) the cumulative Priority Return
from the inception of the Partnership to the end of such
fiscal year;
(iii) Third, to the General Partner until the cumulative
Profits allocated pursuant to this Section 6.5 A. (iii) are
equal to the cumulative distributions of Net Sales Proceeds
made to the General Partner pursuant to Section 6.2 A.
(iii)(b);
(iv) Fourth, to the General Partner until the cumulative
Profits allocated pursuant to this Section 6.5 A. (iv) are
equal to the cumulative distributions of Net Sales Proceeds
made to the General Partner pursuant to Section 6.2 A. (iv);
(v) Fifth, to the Limited Partners until the cumulative
Profits allocated pursuant to this Section 6.5 A. (v) are
equal to the cumulative distributions of Net Sales Proceeds
made to the Limited Partners pursuant to Section 6.2 A. (v);
(vi) Sixth, to the Limited Partners until the cumulative
Profits allocated pursuant to this Section 6.5 A. (vi) are
equal to the cumulative distributions of Net Sales Proceeds
made to the Limited Partners pursuant to Section 6.2 A. (vi);
and
(vii) Seventh, to the General Partner until the cumulative
Profits allocated pursuant to this Section 6.5 A. (vii) are
equal to the cumulative distributions of Net Sales Proceeds
made to the General Partner pursuant to Section 6.2 A. (vii).
B. If there is a net Loss from the sale or other disposition
of Partnership Property, such net Loss shall be allocated, for any
fiscal year, ninety-nine percent (99%) to the Limited Partners and
one percent (1%) to the General Partner. If the General Partner
contributes in excess of one percent (1%) of the Partnership's
capital, then the General Partner's interest in such net Losses
will be equal to the percentage so contributed.
6.6. Determination of Profits and Losses. Profits and Losses
of the Partnership shall be determined and allocated with respect
to each fiscal year of the Partnership as of the end of such year,
except as otherwise required for federal income tax purposes.
6.7. Special Allocation of Real Property ACRS Deductions.
In computing Profits and Losses, as the case may be, for any
taxable year, all cost recovery deductions relating to each
Partnership Property shall be excluded and shall be allocated among
the partners in accordance with this Section 6.7.
A. To the extent the Partnership's cost recovery deductions
are computed under Section 168(h) of the Code using the straight-
line method over a 40-year period, such cost recovery deductions
shall be allocated among the Limited Partners that are "tax-exempt
entities" as defined in Section 168(h)(2) of the Code in the
proportion that each such Limited Partner's Original Capital
Contribution bears to the total Original Capital Contributions of
all such Limited Partners.
B. To the extent the Partnership's cost recovery deductions
are computed under Section 168 (other than Section 168(h)), such
cost recovery deductions shall be allocated among the Limited
Partners that are non tax-exempt entities in the proportion that
each such Limited Partner's adjusted capital contribution bears to
the total adjusted capital contributions of all such Limited
Partners.
C. Notwithstanding the foregoing, the cost recovery
deductions allocated pursuant to paragraphs A and B above shall not
exceed the percentage of Profits or Losses allocated to the Limited
Partners for the year. Any cost recovery deductions in excess of
this limitation shall be allocated to the General Partner.
D. In the event the Partnership sells or otherwise disposes
of Property and realizes a net Profit therefrom, if cost recovery
deductions attributable to such Property have been allocated among
the partners in accordance with this Section 6.7, net Profit shall
first be allocated among the partners in the same proportions as
the cost recovery deductions were previously shared, until the net
Profit allocated pursuant to this Section 6.7 D. equals the amount
of the cost recovery deductions allocated pursuant to this Section
6.7 with respect to such Property. Any remaining net Profit shall
be allocated pursuant to Section 6.5. In the event that a
partner's Interest (or any portion thereof) has been acquired by
any other partner or by a third party, such other partner or third
party shall be allocated that portion of such net Profit which is
attributable to the acquired Partnership Interest. In the event a
new partner or partners are admitted to the Partnership but such
new partner or partners do not acquire an existing Partner's
Partnership Interest (or any portion thereof), any such net Profit
associated with allocations made prior to the admission of such new
partner or partners shall be made to the partners who held an
Interest in the Partnership at the time the allocations were
originally made, or their successors in interest, in proportion to
such original allocations.
6.8. Limitation on Aggregate Deductions During First Two
Years of Operation. Notwithstanding any of the provisions of
Sections 6.4 through 6.7 hereof, the aggregate deductions to be
claimed by the partners as their distributive shares of Losses for
the first two years of operation of the Partnership may not exceed
the amount of equity capital invested in the Partnership.
6.9. Special Allocations: Items in the Nature of Income or
Gain. In the event any Limited Partners unexpectedly receive any
adjustments, allocations, or distributions described in paragraphs
(b)(2)(ii)(d)(4), (b)(2)(ii)(d)(5), or (b)(2)(ii)(d)(6) of Treas.
Regs. sec. 1.704-1, items of Partnership income and gain shall be
specially allocated to such Limited Partners in an amount and
manner sufficient to eliminate the deficit balances in their
Capital Accounts created by such adjustments, allocations or
distributions as quickly as possible. Any special allocations of
items of income or gain pursuant to this Section 6.9 shall be taken
into account in computing subsequent allocations of Profits
pursuant to this Article VI, so that the net amount of any items so
allocated and the Profits, Losses and all other items allocated to
each partner pursuant to this Article VI shall, to the extent
possible, be equal to the net amount that would have been allocated
to each such Person pursuant to the provisions of this Article VI
if such unexpected adjustments, allocations or distributions had
not occurred.
6.10. Special Allocations: Items In the Nature of Expenses
or Losses. Syndication Expenses for any fiscal year or other
period shall be specially allocated to the Limited Partners in
proportion to their Interests, provided that if additional Limited
Partners are admitted to the Partnership pursuant to Section 4.3
hereof on different dates, all Syndication Expenses shall be
divided among the Persons who own Interests from time to time so
that, to the extent possible, the cumulative Syndication Expenses
allocated with respect to each Interest at any time is the same
amount. In the event the General Partner shall determine that such
result is not likely to be achieved through future allocations of
Syndication Expenses, the General Partner may allocate a portion of
Profits or Losses so as to achieve the same effect on the Capital
Accounts of the Limited Partners, notwithstanding any other
provision of this Partnership Agreement.
6.11. Tax Allocations: Code Section 704(c).
A. In accordance with Section 704(c) of the Code, and the
Treasury Regulations thereunder, income, gain, loss and deduction
with respect to any Property contributed to the capital of the
Partnership shall, solely for tax purposes, be allocated among the
partners so as to take account of any variation between the
adjusted basis of such Property to the Partnership for federal
income tax purposes and its initial Fair Asset Value (computed in
accordance with Section 3.19 A. hereof).
B. In the event the Fair Asset Value of any Partnership
Property is adjusted pursuant to Section 3.19 B. hereof, subsequent
allocations of income, gain, loss and deduction with respect to
such asset shall take account of any variation between the adjusted
basis of such asset for federal income tax purposes and its Fair
Asset Value in the same manner as under Section 704(c) of the Code
and the Treasury Regulations thereunder.
C. Any elections or other decisions relating to such
allocations shall be made by the General Partner in any manner that
reasonably reflects the purpose and intention of this Partnership
Agreement. Allocations pursuant to this Section 6.11 are solely
for purposes of federal, state and local taxes and shall not
affect, or in any way be taken into account in computing any
Person's Capital Account or share of Profits, Losses, other items
or distributions pursuant to any provision of this Partnership
Agreement.
6.12. Allocation of Minimum Gain. Notwithstanding any
provision in this Partnership Agreement to the contrary, if there
is a net decrease in Minimum Gain during a Partnership fiscal year,
all partners with negative balances in their Capital Accounts
(after taking into account all distributions made or to be made to
the partners of Cash Available for Distribution) shall be allocated
Partnership income and gain for such fiscal year in the amount and
proportions needed to eliminate such negative balances as quickly
as possible. It is the intent of the partners that the Partnership
allocate Minimum Gain at the times and to the extent required by
Treas. Reg. sec. 1.704-1(b)(4)(iv).
6.13. Distributions Other Than Cash. The Partnership shall
not distribute to the partners property other than cash.
ARTICLE VII
RIGHTS, POWERS, DUTIES AND COMPENSATION OF THE GENERAL PARTNER
7.1. General Authority and Powers of the General Partner.
A. The General Partner shall have the exclusive right and
authority to manage the business of the Partnership and is hereby
authorized to take any action it deems necessary in accordance with
the provisions of this Agreement and applicable law. No Limited
Partner (except one who may also be a General Partner, and then
only in his capacity as a General Partner hereunder) shall
participate in or have any control over the Partnership's business
or shall have any authority or right to act for or bind the
Partnership. The Limited Partners hereby consent to the exercise
by the General Partner of the powers conferred on it by this
Agreement.
B. The General Partner may, in its discretion, establish
Reserves and thereafter maintain such Reserves in such amounts as
the General Partner deems appropriate.
7.2. Specific Authority of the General Partner.
A. Except to the extent otherwise provided herein, the
General Partner for, in the name of, and on behalf and at the
expense of the Partnership, is hereby authorized to do on behalf of
the Partnership all things which, in its sole judgment, are
necessary, proper or desirable to carry out its duties and
responsibilities. The General Partner shall have all the rights
and powers of a general partner as provided in the Wisconsin
Uniform Limited Partnership Act, including, but not limited to, the
right to:
(i) buy, sell and lease in connection with any Property;
(ii) make equity-participating and other loans on income-
producing real Properties that are secured by first or junior
mortgage liens;
(iii) borrow money and procure temporary, permanent,
conventional or other financing on such terms and conditions
and at such rates of interest as it deems appropriate and in
connection therewith, if security is required therefor, to
mortgage or subject to any other security interest any portion
of the Property or assets of the Partnership provided that the
aggregate amount of mortgage indebtedness (other than short-
term financing), which may be incurred in connection with the
acquisition of Properties shall not exceed 50% of their fair
market value (determined by appraisals prepared by independent
appraisers) on a combined basis and the aggregate amount of
such mortgage indebtedness incurred in connection with
financing or refinancing Properties subsequent to their
acquisition shall not exceed 75% of their aggregate
independently appraised value; and provided further, that a
creditor who makes a nonrecourse loan to the Partnership shall
not and must not have or acquire, at any time, as a result of
making the loan, any direct or indirect interest in the
profits, capital or Property of the Partnership other than as
a secured creditor;
(iv) cause the Property acquired or mortgage loan made by
the Partnership to be taken and held in the name of the
nominees, trustees, the General Partner, or in the name of the
Partnership, provided that said Property shall nevertheless be
Partnership Property subject to this Agreement;
(v) bring, defend, settle, compromise or otherwise
participate in any and all actions, proceedings or
investigations whether at law, in equity or before any
governmental authority or agency, and whether brought against
the Partnership or the General Partner, arising out of,
connected with or related to the business and affairs of the
Partnership or the enforcement or protection of interests in
the Partnership;
(vi) insure Partnership activities and Partnership
assets;
(vii) enter into agreements with Persons including itself
and Affiliates for Property management, accounting and legal
services and other contracts or agreements, and pay from
Partnership funds the consideration required under such
contracts or agreements which contracts shall be terminable by
the Partnership without penalty upon 60 days written notice,
and which may only be modified by a vote of a majority of the
Limited Partners;
(viii) employ or retain such individuals, firms or
corporations, including the General Partner acting on its own
behalf, for the operation and management of Partnership Prop-
erty and mortgage loan investments, including, without
limitation, supervisors or managing agents, building
caretakers, accountants, and attorneys, on such terms and at
such compensation as the General Partner determines; provided
that any contract entered into with the General Partner or
Affiliates shall not be less favorable than, and any charges
for Property or services shall not be in excess of, such terms
or charges customarily imposed by others in the same line of
business and in the same area but not so related;
(ix) pay out of Partnership funds all fees and expenses
incurred in the organization of the Partnership and the sale
of Interests, as well as all fees and expenses necessary to
carry on the business and accomplish the purposes of the
Partnership;
(x) pay the Acquisition Fee out of Sales Proceeds or
proceeds of financing or from Partnership income provided that
all such fees shall not exceed the lesser of (a) 18% of that
portion of the offering proceeds allocable to investment in
Properties or (b) the amount customarily charged in arm's-
length transactions for similar services in the same
geographic locations for comparable Properties considering
size and type of Property;
(xi) perform any and all other acts or activities
customary or incident to the acquisition, ownership,
management, improvement, leasing and disposition of real
estate;
(xii) prepay in whole or in part, sell, refinance, recast,
increase, modify, renew or extend any mortgages or deeds of
trust affecting any Property of the Partnership, or, subject
to the provisions of Section 7.4, accept prepayment of or
refinance, recast, increase, modify, renew or extend any
mortgage loan made by the Partnership;
(xiii) manage and operate any Partnership Property or
investment, and enter into operating agreements with others
containing such terms, provisions and conditions as the
General Partner shall approve. Expenses of operating
Partnership Property shall be billed directly to the
Partnership and shall not include indirect expenses of the
General Partner such as salaries and overhead;
(xiv) enter into and execute agreements and any and all
documents and instruments customarily employed in the real
estate and mortgage loan industry in connection with the
acquisition, sale, development, and operation of Partnership
Property; agreements, commitments and any and all documents
and instruments customarily employed in real estate financing,
receipts, releases and discharges; and all other instruments
deemed by the General Partner to be necessary or appropriate
to the proper operation or development of Partnership Property
or to perform effectively and properly its duties or exercise
its powers hereunder;
(xv) pay Operating Expenses, Organizational and Offering
Expenses, the Property Management Fee, the Mortgage Placement
Fee, if any, and the Mortgage Brokerage Fee, if any, including
reimbursement to the General Partner or Affiliates for all
expenses incurred in the organizing of the Partnership and
selling the Interests. All expenses shall be billed directly
to and paid by the Partnership to the extent practicable. The
General Partner and Affiliates will be reimbursed by the
Partnership for the actual cost of goods and materials used by
or for the Partnership and obtained from entities not
affiliated with the General Partner, including the following
general functions of the Partnership: Partnership operations;
Partnership accounting; investor communications; investor
documentation; legal services; tax services; computer
services; risk management; Partnership Organizational and
Offering Expenses; Acquisition Expenses and any other related
operational and administrative expenses necessary for the
prudent organization and operation of the Partnership. Such
reimbursement shall be at the lower of the General Partner's
actual cost or 90% of the amount for which comparable services
could have been obtained from unaffiliated parties in the same
geographic area, and no reimbursement shall be made for
services for which the General Partner or Affiliates are
entitled to compensation by way of a separate fee. Excluded
from the allowable reimbursement shall be:
(a) Rent or depreciation, utilities, capital equipment,
or other administrative items;
(b) Salaries, fringe benefits, travel expenses, and
other administrative items incurred by or allocated to any
controlling Persons of the General Partner or any of its
Affiliates;
(xvi) terminate the offering and/or compel dissolution and
termination of the Partnership if assets of the Partnership
constitute "plan assets" for purposes of ERISA; and
(xvii) employ a Partnership Manager to operate under the
direction of the General Partner at the expense of the
Partnership.
B. Any of the duties and responsibilities of the General
Partner under this Agreement may be delegated, assigned, or
subcontracted by the General Partner on whatever terms and condi-
tions may be acceptable to it at any time, to any individual,
corporation or other entity including Affiliates of the General
Partner which, in the judgment of the General Partner, is capable
of performing the same. If the General Partner assigns, delegates
or subcontracts any of its duties and responsibilities hereunder,
the General Partner shall continue to be primarily responsible for
the fulfillment of all the obligations as set forth herein.
C. Any Person dealing with the Partnership or the General
Partner may rely upon a certificate signed by the General Partner
as to:
(i) the identity of the General Partner or any Limited
Partner;
(ii) the existence or non-existence of any fact or facts
which constitute a condition precedent to acts by the General
Partner or any other matter germane to the affairs of the
Partnership;
(iii) the Persons who are authorized to execute and
deliver any instrument or document of the Partnership; or
(iv) any act or failure to act by the Partnership or as
to any other matter whatsoever involving the Partnership or
any partner.
D. Only the General Partner shall have the right, power and
authority to execute documents on behalf of and in the name of the
Partnership, and no Person shall be obligated to inquire into the
authority of a General Partner to bind the Partnership.
7.3. Restrictions on Authority of the General Partner.
A. The General Partner shall not have the authority to:
(i) do any act in contravention of the Wisconsin Uniform
Limited Partnership Act or this Agreement or which would make
it impossible to carry on the ordinary business of the
Partnership;
(ii) confess a judgment against the Partnership;
(iii) possess Partnership Property, or assign its rights
in specific Partnership Property, for other than a Partnership
purpose;
(iv) admit a Person as a General Partner except as
provided in this Agreement;
(v) admit a Person as a Limited Partner, except as
provided in this Agreement;
(vi) knowingly perform any act that would subject any
Limited Partner to liability as a general partner in any
jurisdiction;
(vii) commingle the Partnership funds with those of any
other Person;
(viii) loan or cause an Affiliate of any General Partner to
loan any funds to the Partnership on terms less favorable to
the Partnership than would be offered by unrelated financial
institutions for comparable loans for the same purpose
provided that the principal amount of indebtedness encumbering
a Partnership Property shall be scheduled to be paid over a
period of not less than 48 months and provided that not more
than 50% of the principal amount is scheduled to be paid
during the first 24 months. The General Partner or Affiliates
may receive a real estate commission on the resale of any
Partnership Property, but the amount thereof is limited by
this Agreement. The General Partner is not precluded from
engaging for its own account in business activities of the
type conducted and to be conducted by the Partnership;
(ix) cause the Partnership to invest any of its funds in
any other limited partnership except that the Partnership may
participate as a partner in general partnerships or joint
ventures which own and operate real Property, provided that
the Partnership controls such other general partnership or
joint venture and further provided, that no duplicate property
management or other fees are paid. The Partnership also may
participate in joint ventures with other real estate programs
sponsored by the General Partner and/or Affiliates provided
that (a) the affiliated real estate program has investment
objectives substantially identical to the investment
objectives of the Partnership, (b) no duplicate property
management or other fees are paid, (c) the compensation to the
sponsor or sponsors of the affiliated real estate program is
substantially similar to the compensation to the General
Partner, (d) the Partnership is granted a right of first
refusal to purchase the real Property of the joint venture in
the event the affiliated joint venturer desires to sell such
Property and (e) the investments in the joint venture by the
Partnership and the affiliated real estate program are on
substantially the same terms and conditions. Except for the
foregoing real estate joint ventures or general partnerships,
and except where real estate constitutes assets of a
corporation or a corporation owns assets which constitute a
functional part of a real estate project being acquired by the
Partnership and acquisition of the real estate or such related
assets can best be effected by acquiring stock of that
corporation, the Partnership will not invest in other real
estate programs or invest in securities of other issuers for
the purpose of exercising control and will not underwrite
securities of other issuers or issue Interests in exchange for
Property;
(x) cause the Partnership to pay real estate commissions
on the resale of any Property of the Partnership to any
General Partner or any Affiliates unless the Limited Partners
have received a return of 100% of their Original Capital
Contribution plus cumulative, noncompounded distributions of
Sales Proceeds and Cash Available for Distribution equal to 6%
per annum of their Capital Investment. Upon the sale of any
Property of the Partnership, any such real estate commissions
paid by the Partnership to the General Partner or any
Affiliates shall be limited to 50% of the Competitive Real
Estate Commission, except that in no event shall the real
estate commission payable to the General Partner or Affiliates
exceed 3% of the sale price of the Property;
(xi) purchase for or lease Property to the Partnership if
any General Partner or any Affiliate of any General Partner
has an interest in such Property except that the General
Partner may purchase Property in its own name (and assume
loans in connection therewith) and temporarily hold title
thereto for the purpose of facilitating the acquisition of
such Property or the borrowing of money or obtaining of
financing for the Partnership, or any other purpose related to
the business of the Partnership; provided that such Property
is purchased by the Partnership for a price no greater than
the cost of such Property to the General Partner and; provided
further, that there is no difference in interest rates of the
loans secured by the Property at the time acquired by the
General Partner and the time acquired by the Partnership, nor
any other benefit arising out of such transaction to the
acquiring General Partner apart from compensation otherwise
permitted by this Agreement;
(xii) cause the Partnership to sell or lease any
Partnership Property to any General Partner or any Affiliate
of a General Partner;
(xiii) cause the Partnership to loan funds to any General
Partner or any Affiliate of the General Partner except as
provided in Section 7.4 K;
(xiv) cause the Partnership to acquire any Property from
any other partnership in which the General Partner or any
Affiliate of the General Partner has an interest;
(xv) cause the Partnership to acquire any Property in
exchange for Interests;
(xvi) grant to any General Partner or an Affiliate of any
General Partner the exclusive right to sell any Property of
the Partnership;
(xvii) pay any rebates or give-ups or engage in reciprocal
business arrangements with Affiliates;
(xviii) directly or indirectly pay or award any commission
or other compensation to any Person engaged by a potential
investor for investment advice as an inducement to such
adviser to advise a purchase of Interests (the foregoing shall
not preclude payment of a sales commission);
(xix) permit any creditor who makes a nonrecourse loan to
the Partnership to have or acquire, at any time as a result of
making the loan, any direct or indirect interest in the
profits, capital, or Property of the Partnership other than as
a secured creditor;
(xx) cause the Partnership to incur the cost of that
portion of any liability insurance which insures the General
Partner from any liability as to which the General Partner is
prohibited from being indemnified;
(xxi) cause the Partnership to reinvest any of the
proceeds resulting from repayment of a mortgage loan or the
sale or refinancing of a real Property unless sufficient cash
shall have been distributed to pay the taxes created by the
repayment of the loan or the sale or refinancing of Property
(assuming the highest applicable federal bracket taxpayer); or
(xxii) cause the Partnership to sell more than 25% of the
total Partnership Interests to be sold in California.
B. Without the Consent of a majority in Interest of the
Limited Partners, the General Partner shall not have the authority
to:
(i) sell or otherwise dispose of at one time all or
substantially all the assets of the Partnership except for (a)
a liquidating sale of a final asset remaining as a result of
the sale of Properties or repayment of mortgage loans in the
ordinary course of business, or (b) a refinancing of all or
substantially all of the Partnership Properties and mortgage
loans, if any;
(ii) elect to dissolve the Partnership; or
(iii) make any changes in the Partnership's investment
objectives and policies.
7.4. Making of Mortgage Loans.
A. The Partnership may, in the sole discretion of the
General Partner, utilize up to an aggregate of 20% of the net
proceeds available for investment for the purpose of making
permanent equity participating and other loans on real Property
secured by first or junior mortgage liens as described below. (The
Partnership shall not be obligated, however, to invest any of the
net proceeds from the sale of Interests in mortgage loans.)
Subject to the limitations expressed herein, if the Partnership
elects to make mortgage loans, it shall utilize such proceeds
primarily for the purpose of making loans that are secured by first
or junior mortgage liens on improved income-producing real Property
such as shopping centers, office buildings or apartment complexes.
B. The terms of mortgage loans made by the Partnership shall
be established by the General Partner in accordance with the
following principles: The Partnership shall not make or commit to
make mortgage loans for terms of more than ten years or with
maturity dates beyond December 31, 2005. The interest rate on
mortgage loans made by the Partnership shall be established by the
General Partner with due consideration for then prevailing market
rates for loans of similar type and maturity, the creditworthiness
of the borrowers, the collateral security for the loans, projected
future financial and economic conditions and other relevant
criteria. Such interest rates may be fixed at a specified rate or
may vary according to a designated index.
C. All or a portion of the interest owing on the
Partnership's mortgage loans (if any) shall be made payable
periodically, but in no event less frequently than annually. Any
interest charges that are not payable on a current basis shall
accrue and may or may not compound periodically. All accrued and
unpaid interest shall be required to be paid on maturity of the
mortgage loans. The Partnership will (if it elects to make
mortgage loans) generally seek (but will not be required) to make
mortgage loans that, in addition to providing for a specified base
rate of interest (whether fixed or variable), permit the
Partnership to participate in the economic benefits of the
underlying real Property through the receipt of additional interest
based upon a specified fixed or sliding scale percentage of (a)
target revenues derived from the operation of the underlying
Property and/or (b) any increase in the value of the Property
realized by the borrower, either through sale or refinancing of the
Property or otherwise, such as by appraisal.
D. The Partnership ordinarily will require that the
principal amount of any mortgage loans be paid in a lump sum on
maturity, and may impose a fixed or sliding scale premium upon any
prepayment thereof. Alternatively, the Partnership may require
that all or a portion of the principal amount of the mortgage loan
be amortized at the loan's stated interest rate or some other rate
over all or a portion of the term of the loan.
E. The Partnership shall require such collateral security
for payment of its mortgage loans (if any) that the General Partner
determines is prudent. Such collateral security ordinarily will be
in the form of a mortgage or deed of trust lien on the underlying
Property, which lien may be senior or subordinate to other liens
then existing or to be placed on the Property as the General
Partner shall determine. Other forms of collateral security, such
as letters of credit or liens on other real Property, may be
utilized, however, and the Partnership's recourse for payment of
its mortgage loans normally will be limited to the collateral
security therefor.
F. In determining to make or commit to make a particular
mortgage loan, the General Partner shall consider such factors as
historical and projected operating income and expenses of the
underlying Property, the real estate management and operating
experience of the prospective borrower, historical occupancy rates
of the underlying Property and all existing and future competitive
market conditions, general financial and economic conditions, the
investment objectives of the Partnership, the geographic diversity
of its mortgage loans and other factors deemed relevant by the
General Partner. In each case, if the Partnership shall commit to
fund a particular mortgage loan, it shall do so subject to
conditions that the General Partner determines are warranted under
the circumstances. Such conditions shall include, at a minimum, a
requirement that the prospective borrower obtain a mortgagee's or
owner's policy of title insurance or commitment insuring the
priority of the Partnership's lien and the condition of title to be
obtained on the underlying Property. The Partnership shall also
receive an independent appraisal of the value of each Property on
which it is to make a mortgage loan or on such other real Property
that is to serve as collateral for the Partnership's mortgage loan.
The aggregate principal amount of each mortgage loan made by the
Partnership (if any) and all other mortgage loans on the mortgaged
Property shall not exceed 80% of the appraised value of such
Property at the time the mortgage loan is made; provided that such
loan-to-value ratio may be increased to not more than 85% for a
particular mortgage loan if, in the judgment of the General
Partner, the borrower's credit conditions or the collateral
security for the mortgage loan justifies such higher ratio; and
provided further that the above-mentioned loan-to-value ratio shall
not apply to insured mortgage loans made by the Partnership. In
addition, the Partnership shall not make any one mortgage loan in
a principal amount in excess of 15% of the gross proceeds from the
sale of Interests or mortgage loans to a single borrower in an
aggregate principal amount in excess of 15% of such proceeds.
G. Subject to the restrictions provided herein, the
Partnership may extend the maturity of any mortgage loan, consent
to the sale of any Property subject to a mortgage loan or finance
the acquisition of such Property by making a new mortgage loan
(either with or without requiring repayment of the original
mortgage loan), renegotiate the terms of or otherwise deal with any
such loan as the General Partner may from time to time determine to
be in the best interests of the Partnership.
H. The General Partner or an Affiliate may originally make
or acquire mortgage loans in its own name and temporarily hold the
loans for the purpose of avoiding the receipt of unrelated business
taxable income by tax-exempt Limited Partners, facilitating the
making of such loans or for any other purpose related to the
business of the Partnership; provided that (a) any such mortgage
loan is acquired by the Partnership for a price no greater than the
cost to the General Partner or Affiliate of making and holding such
mortgage loan, except for compensation to the General Partner or
Affiliate as provided herein, (b) there is no difference in the
interest rate of the mortgage loan at the time it was made or
acquired by the General Partner or Affiliate and the time it is
acquired by the Partnership and (c) the General Partner or
Affiliate receives no other benefit arising out of such transaction
apart from compensation permitted hereunder.
I. The Partnership shall not incur indebtedness for the
purpose of making mortgage loans, although the proceeds from any
financing or refinancing of Partnership Properties or sale or
repayment of mortgage loans that occurs within 24 months after the
termination of the public offering of Interests that are available
for investment may be used to make mortgage loans, subject to the
provisions of Section 7.4 J hereof. Moreover, the Partnership may
incur indebtedness in order to prevent default by borrowers under
their mortgage loans or to discharge them entirely if this becomes
necessary to protect the loans. In addition, the Partnership may
incur indebtedness in order to assist in the operation of any
Property on which the Partnership has theretofore made a mortgage
loan and has subsequently taken over the operation thereof as a
result of a default by the borrower or to protect the mortgage
loan.
J. In the event a mortgage loan made with proceeds from the
sale of Interests is repaid or refinanced within 24 months of the
termination of the offering, the resulting proceeds may in the
discretion of the General Partner be used to fund new mortgage
loans. However, reinvestment of the resulting proceeds shall not
occur unless sufficient cash will be distributed to pay any state
or federal income tax created by the repayment of a mortgage loan
(assuming investors are in the highest applicable federal tax
bracket). Any proceeds resulting from the repayment or refinancing
of mortgage loans after 24 months following the termination of the
offering of Interests shall be available for distribution as part
of the Cash Available for Distribution or Sales Proceeds, as the
case may be, and shall not be reinvested. Any proceeds from the
repayment or refinancing of loans not used to make new mortgage
loans will, to the extent available for distribution, be included
as part of Cash Available for Distribution or Sales Proceeds, as
the case may be.
K. The Partnership may provide mortgage financing to
publicly or privately offered real estate limited partnerships
affiliated with the General Partner in connection with the
acquisition and/or ownership by such partnerships of real
Properties. Prior to any such transaction, an independent and
qualified adviser meeting the qualifications set forth in the NASAA
Guidelines, shall issue a letter of opinion to the effect that the
proposed loan is fair and at least as favorable to the Partnership
as a loan to an unaffiliated borrower in similar circumstances.
Mortgage loans made by the Partnership to partnerships affiliated
with the General Partner shall be on terms not less favorable to
the Partnership than those that would be required by unrelated
lending institutions or entities that would be willing to provide
comparable loans for the same purpose. The General Partner will be
required to obtain a letter of opinion from the independent adviser
in connection with any disposition, renegotiation or other
subsequent transaction involving loans made to the General Partner
or an Affiliate. The adviser's compensation will be paid by the
General Partner and will not be reimbursed by the Partnership.
7.5. Duties and Obligations of the General Partner.
A. The General Partner shall take all action which may be
necessary or appropriate (i) for the continuation of the
Partnership's valid existence as a limited partnership under the
laws of the State of Wisconsin (and of each other jurisdiction in
which such existence is necessary to protect the limited liability
of the Limited Partners or to enable the Partnership to conduct the
business in which it is engaged) and (ii) for the acquisition,
development, maintenance, preservation and operation of Property of
the Partnership and the making of mortgage loans in accordance with
the provisions of this Agreement and applicable laws and
regulations.
B. The General Partner shall amend the Certificate of
Limited Partnership at least once each calendar quarter to effect
the substitution of substituted Limited Partners, unless such
action is not required by applicable law.
C. The General Partner shall devote to the Partnership such
time as it deems necessary for the proper performance of its duties
hereunder, but the General Partner shall not be required to devote
its full time to the performance of such duties.
D. The General Partner shall use its best efforts to conduct
its business and the business of the Partnership in such a manner
that neither the Partnership nor any partner will have personal
liability under any mortgage on any Property unless in the opinion
of the General Partner such personal liability, which in no case
will extend to any Limited Partner, will be in the best interests
of the Limited Partners.
E. The General Partner shall prepare or cause to be prepared
and shall file on or before the due date (or any extension thereof)
any federal, state or local tax returns required to be filed by the
Partnership. The General Partner shall cause the Partnership to
pay any taxes payable by the Partnership.
F. At the expense and for the benefit of the Partnership,
the General Partner shall obtain and keep in force such insurance,
including fire and extended coverage, worker's compensation and
public liability insurance as the General Partner shall deem
advisable.
G. The General Partner shall be under a fiduciary duty to
conduct the affairs of the Partnership in the best interests of the
Partnership and of the Limited Partners, including the safekeeping
and use of all Partnership funds and assets for the exclusive
benefit of the Partnership. Neither the General Partner nor any
Affiliates shall enter into any transaction with the Partnership
which may significantly benefit the General Partner or any such
Affiliates in their independent capacity unless the transaction is
expressly permitted hereunder or is entered into principally for
the benefit of the Partnership in the ordinary course of the
Partnership's business.
H. The acquisition of any Property by the Partnership shall
be supported by an appraisal prepared by a competent independent
appraiser and such appraisal shall be maintained in the records of
the Partnership for at least five years from its date and shall be
available for inspection and duplication by any Limited Partner at
his expense.
I. In the event that XXX, pension/profit-sharing plan
investors or participants in the reinvestment plan elect to
purchase fractional Interests in $10 increments pursuant to Section
4.3, after their initial $2,000, $25,000 or $3,000 respective
investment, and any fractional Interests remain unsold upon the
termination of the offering, the General Partner shall purchase any
and all such unsold fractional Interests.
J. The General Partner shall commit a substantial portion of
the capital contributions toward Investment in Properties. The
remaining capital contributions may be used to pay Front-End Fees.
Acquisition Fees paid by the seller of Properties and Front-End
Fees shall not be included in satisfying the minimum investment in
Properties requirement. The General Partner shall commit a
percentage of the capital contributions to Investment in Properties
which is equal to (A) 80% of the capital contributions reduced by
.1625% for each 1% of financing of Partnership Properties or (B)
67% of capital contributions.
7.6. Loans Made to the Partnership by the General Partner.
Other than a General Partner's Loan, on temporary financing made
available to the Partnership by the General Partner, the General
Partner may not receive interest and other financing charges or
fees in excess of the amounts which would be charged by unrelated
banks on comparable loans for the same purpose in the locality of
the particular Property for which financing is being provided, and
such interest, charges or fees shall in no event exceed 2% over the
commercial prime rate then being charged by the General Partner's
primary commercial bank on unsecured loans. No prepayment charge
or penalty shall be required by the General Partner on a loan to
the Partnership secured by either a first or a junior or all-
inclusive trust deed, mortgage or encumbrance on any of the
Properties, except to the extent that such prepayment charge or
penalty is attributable to the underlying encumbrance(s). The
General Partner shall be prohibited from providing permanent
financing for the Partnership. Any General Partner's Loan shall
bear interest at the minimum annual rate required by the Code to
avoid the imposition of imputed interest under the Code but in no
event in excess of the General Partner's cost of the funds. The
principal amount of any such loan shall be scheduled to be paid
over a period of not less than 48 months and not more than 50% of
such principal amount shall be scheduled to be paid during the
first 24 months.
7.7. Compensation and Interest of the General Partner. The
General Partner shall not in its capacity as a General Partner
receive any salary, fees, profits, or distributions except fees,
profits, distributions and allocations to which it may be entitled
under this Agreement. The General Partner or Affiliates shall
receive the following fees and compensation for the following
services:
A. The Acquisition Fee for services rendered to the
Partnership payable to the General Partner.
B. Sales commissions for the sale of Interests payable to
Affiliates of the General Partner to the extent not paid to
Nonaffiliated Persons.
C. The Property Management Fee payable to Decade Properties,
Inc.
D. The Mortgage Brokerage Fee, if any, payable to the
General Partner.
E. The Mortgage Placement Fee, if any, payable to the
General Partner.
7.8. Other Business Activities. The General Partner and
Affiliates may engage independently or with others in other
business ventures of every nature and description, including,
without limitation, the rendering of advice or services of any kind
to other investors and the making or management of other
investments. Nothing in this Agreement shall be deemed to prohibit
the General Partner or any Affiliates from dealing or otherwise
engaging in business with Persons transacting business with the
Partnership or from providing services relating to the purchase,
sale, management, development or operation of real Property and
receiving compensation therefor. Neither the Partnership nor any
partner shall have any right by virtue of this Agreement or the
partnership relationship created hereby, in or to such other
ventures or activities or to the income or proceeds derived
therefrom, and the pursuit of such ventures shall not be deemed
wrongful or improper.
7.9. Limitation on Liability of the General Partner. The
General Partner shall not be liable, responsible or accountable in
damages or otherwise to the Partnership or to any of the Limited
Partners for loss suffered by the Partnership which arises out of
any action or inaction of the General Partner if the General
Partner, in good faith, determined that such course of conduct was
in the best interests of the Partnership and such course of conduct
did not constitute negligence or misconduct of the General Partner.
The Partnership shall indemnify the General Partner against any
losses, judgments, liabilities, expenses (including attorneys'
fees) and amounts paid in settlement of any claims sustained by it
in connection with the Partnership provided that the same were not
the result of negligence or misconduct on the part of the General
Partner. Notwithstanding the foregoing, the General Partner shall
not be indemnified for liabilities arising under federal and state
securities laws unless (a) there has been a successful adjudication
on the merits of each count involving securities law violations or
(b) such claims have been dismissed with prejudice on the merits by
a court of competent jurisdiction.
ARTICLE VIII
ADMISSION OF SUCCESSOR AND ADDITIONAL GENERAL PARTNER;
WITHDRAWAL OF A GENERAL PARTNER
8.1. Admission of Successor or Additional General Partner;
Withdrawal of a General Partner.
A. With the Consent of a majority in Interest of the Limited
Partners, the General Partner may at any time designate one or more
Persons to be successors to the General Partner or to be an
additional General Partner, in each case with such participation in
the General Partner's Interest as the General Partner and such
successors or additional General Partner may agree upon.
B. Except in connection with a transfer to a successor or
additional General Partner pursuant to Section 8.1 A or in the
remainder of this Section, the General Partner shall not have any
right to retire or withdraw voluntarily from the Partnership or to
sell, transfer or assign its Interests. The general partners of
Decade Companies or either of them may voluntarily withdraw
therefrom at any time after completion of the acquisition phase of
the Partnership's existence, and substitute in their place, a
corporation having a net worth of at least $1,000,000. The General
Partner may incorporate provided at such time it has a net worth of
at least $1,000,000.
8.2. Bankruptcy, Death, Dissolution or Incompetence of a
General Partner. The bankruptcy, death, dissolution or
adjudication of incompetence of a General Partner (an "involuntary
withdrawal") shall not result in a termination of the business of
the Partnership, unless there is no remaining General Partner and,
if there is no remaining General Partner if, within 60 days after
any such event, no successor General Partner shall have been
elected by the Limited Partners. If, at the time of the
involuntary withdrawal of a General Partner, such General Partner
is not the sole General Partner, the remaining General Partner or
General Partners shall continue the business of the Partnership.
8.3. Liability of a Withdrawn General Partner. Any General
Partner who shall voluntarily or involuntarily withdraw from the
Partnership shall remain liable for all obligations and liabilities
incurred by him as General Partner until the withdrawal of such
General Partner, but such General Partner shall be free of any
obligation or liability incurred on account of the activities of
the Partnership from and after the time of the effectiveness of
such General Partner's withdrawing from the Partnership.
8.4. Removal of a General Partner. A majority in Interest of
the Limited Partners may remove a General Partner by a notification
to the effect that such General Partner is removed. Concurrently
with serving such notification or within 30 days thereafter by
notification similarly given, a majority in Interest of the Limited
Partners may designate a new General Partner (if after such removal
there is no General Partner). Failure of the Limited Partners to
designate a new General Partner (if after such removal there is no
General Partner) or failure of the new General Partner to execute
a written acceptance of the duties and responsibilities of a
General Partner within 30 days after designation (if after such
removal there is no General Partner) shall dissolve the
Partnership. Notwithstanding any contrary provision contained in
this Agreement, the foregoing removal power shall be subject to (i)
either a prior determination by a court of competent jurisdiction
in an action for declaratory judgment or similar relief brought by
or on behalf of the Limited Partners and not by the General
Partner, that the exercise of the removal right will not be deemed
to be taking part in control of the business or result in the loss
of any Limited Partner's limited liability or at the election of
the Limited Partners, an opinion of counsel for such Limited
Partners to that effect, and (ii) either a private ruling by the
Internal Revenue Service or an opinion of counsel for the Limited
Partners that such removal right will not result in the
Partnership's not being considered a partnership for federal income
tax purposes.
8.5. Interest of General Partner Upon Involuntary Withdrawal
or Removal.
A. Upon the involuntary withdrawal or removal of any General
Partner, the remaining General Partner(s) shall be obligated to
accept an assignment of such withdrawing or removed General
Partner's interest in Profits and Losses. Such assignment shall be
effective automatically upon such withdrawal. No further
documentation will be necessary to evidence this assignment.
B. Upon the voluntary withdrawal or removal of any General
Partner, the Appraised Value of the Interest of such withdrawing or
removed General Partner in distributions of Sale Proceeds shall be
promptly determined by an appraisal company mutually agreed upon
between the withdrawing or removed General Partner and the
Partnership, provided that if the parties are unable to agree upon
the selection of an appraisal company within 30 days from the date
of withdrawal or removal, the Partnership shall retain American
Appraisal Company, Milwaukee, Wisconsin, to prepare such appraisal.
In the event of removal of the General Partner, all appraisal costs
shall be borne equally by the General Partner and the Partnership.
The Appraised Value of the Interest of an involuntarily removed
General Partner shall be paid to such partner or his legal
representative, by the Partnership pursuant to a promissory note
bearing interest at 2% above the prime rate and coming due in not
less than 5 years with equal annual payments in cash. The
Appraised Value of the Interest of a voluntarily withdrawn General
Partner shall be paid pursuant to a non-interest bearing unsecured
promissory note with principal payable from distributions which the
withdrawing General Partner would have received pursuant to the
Partnership Agreement had it not withdrawn.
ARTICLE IX
TRANSFERABILITY OF INTERESTS
9.1. Restrictions on Transfers.
A. No sale or exchange of any Interest may be made if the
Interest sought to be sold or exchanged, when added to the total of
all other Interests sold or exchanged within a period of 12
consecutive months prior thereto, will, in the opinion of counsel
for the Partnership, result in the Partnership's being considered
to have been terminated within the meaning of Section 708 of the
Code.
B. No Limited Partner shall withdraw his capital
contribution or transfer, assign, sell, mortgage or otherwise
encumber his Interests in the Partnership or in its capital,
assets, income or loss, or enter into any agreement as a result of
which any other Person shall become interested in the Partnership
without the prior written consent of the General Partner, which
consent may be withheld for any reason the General Partner, in its
sole discretion, deems sufficient. Grounds upon which consent to
an assignment may be withheld include, but are not limited to:
(i) the proposed assignee does not meet the appropriate
suitability standards for acquiring an Interest;
(ii) the assignment will require, in the opinion of
counsel to the Partnership, registration under the securities
laws of any state, other than one in which the Interests are
registered for sale;
(iii) the assignment will be inconsistent with the terms
of an opinion of counsel to the Partnership or will be
inconsistent with the terms of transfer that may be imposed by
such counsel or by any agreement to which the Partnership is
a party, including, but not limited to, terms relating to
receipt of appropriate documentation with respect to place of
residence, suitability and restrictions on further transfer,
sale, exchange or distribution; or
(iv) if, in the opinion of the Partnership's counsel,
such transfer or assignment may result in the Partnership's
being treated as a corporation for federal income tax
purposes.
C. No transfer, sale or assignment of any Interest will be
recognized except as of the first day of a fiscal quarter.
D. Any transfer, sale or assignment must be of at least one
Interest, except for transfers by operation of law or by a Limited
Partner other than an individual, to its partners, shareholders or
beneficiaries and except for IRA's, pension/profit-sharing plans or
Participants in the reinvestment plan investing additional amounts
after their initial $2,000, $25,000 or $3,000 respective investment
and then in $10 increments, and no assignment (except for an
assignment by operation of law or by a Limited Partner other than
an individual, to its partners, shareholders or beneficiaries) may
result in any Person holding less than three full Interests
($3,000); two ($2,000) in the case of an XXX, twenty-five ($25,000
subject to reduction in the discretion of the General Partner) in
the case of a pension/profit-sharing plan (including plans formerly
known as Xxxxx Plans or H.R. 10 Plans).
E. The assigning Limited Partner shall pay all of the
Partnership's costs and expenses in passing upon and effecting such
assignment.
9.2. Assignees and Substituted Limited Partners.
A. If a Limited Partner dies, his personal representative or
trustee, or, if he is adjudicated an incompetent, his committee,
guardian or conservator, or, if he becomes bankrupt, the trustee or
receiver of his estate, shall have all the rights of a Limited
Partner for the purpose of settling or managing his estate and such
power as such Limited Partner possessed to assign all or any part
of his Interests and to join with such assignee's becoming a
substituted Limited Partner. The death, dissolution, adjudication
of incompetence or bankruptcy of a Limited Partner shall not
dissolve the Partnership.
B. No assignment of an Interest though otherwise permitted
by Section 9.1, shall be valid and effective, and the Partnership
shall not recognize the same for the purpose of cash distributions
or for the allocation of Profit or Loss, until there is filed with
the General Partner an instrument in writing on forms provided by
the General Partner subscribed by both parties to the conveyance.
C. After receiving an executed assignment, the Partnership
shall make all further distributions and allocate any Profit or
Loss to the assignee with respect to the Interests transferred,
regardless of whether such transfer, as between the parties
thereto, is or is intended to be a pledge, mortgage, encumbrance or
other hypothecation, until such time as the Interests transferred
shall be further transferred in accordance with the provisions of
this Agreement.
D. Any Limited Partner who shall assign all his Interests
shall cease to be a Limited Partner of the Partnership, except that
until the assignee is admitted as a Limited Partner such assigning
Limited Partner shall retain the statutory rights of an assignor of
a limited partnership interest under the laws of Wisconsin,
including, without limitation, the right to vote on certain matters
as herein set forth. The rights of an assignee of an Interest who
does not become a substituted Limited Partner shall be limited to
receipt of his share of distributions, Profits and Losses.
E. Any Person who is an assignee of one or more of the
Interests and who is accepted as a Limited Partner by the General
Partner, which acceptance may be granted or withheld in its sole
discretion, shall become a substituted Limited Partner when such
Person shall have satisfied the conditions of Article XIV and shall
have paid all fees, charges and filing costs in connection with his
substitution as a Limited Partner.
F. A Person who is the assignee of Interests of a Limited
Partner, but does not become a substituted Limited Partner and
desires to make a further assignment of any of such Interests,
shall be subject to all the provisions of this Article to the same
extent as a Limited Partner desiring to make an assignment of his
Interests.
ARTICLE X
DISSOLUTION, TERMINATION AND LIQUIDATION OF THE PARTNERSHIP
10.1. Events Causing Dissolution. The Partnership shall be
dissolved upon the happening of any of the following events:
(i) the retirement, removal, death, adjudication of
bankruptcy or incompetency or the dissolution of a sole
General Partner, unless within the time specified in this
Agreement, the Limited Partners elect a successor General
Partner to continue the business of the Partnership under the
terms and conditions of this Agreement;
(ii) the sale or other disposition of all or
substantially all the assets of the Partnership unless the
Partnership acquires, in consideration, a lease or mortgage,
in which case the Partnership will be dissolved following the
sale of its entire interest in such mortgage or lease;
(iii) the election by the General Partner or the vote by
the Limited Partners, in the manner required by this
Agreement, to dissolve the Partnership;
(iv) the happening of any other event causing the
dissolution of the Partnership under the laws of Wisconsin;
(v) the determination that the Partnership's assets
constitute "plan assets;" or
(vi) the expiration of the term of the Partnership.
Dissolution of the Partnership shall be effective on the date
on which the event giving rise to the dissolution occurs, but the
Partnership shall not terminate until the Partnership's Certificate
of Limited Partnership shall have been canceled and the assets of
the Partnership shall have been distributed. Notwithstanding the
dissolution of the Partnership, prior to the liquidation and
termination of the Partnership, the business of the Partnership and
the affairs of the partners, as such, shall continue to be governed
by this Agreement.
10.2. Liquidation.
A. Upon dissolution of the Partnership, the General Partner
shall liquidate the assets of the Partnership, apply and distribute
the proceeds thereof, first to the payment of obligations of the
Partnership and the expenses of liquidation, then to the setting up
of any Reserves for contingencies which the General Partner may
consider necessary, then to the partners in accordance with their
Capital Accounts.
B. In the event the Partnership is "liquidated" within the
meaning of Treas. Regs. sec. 1.704-1(b)(2)(ii)(g); (a) distribution
shall be made pursuant to this Article X (if such liquidation
constitutes a dissolution of the Partnership) or Article VI hereof
(if it does not) to the partners who have positive Capital Accounts
in compliance with Treas. Regs. sec. 1.704-1(b)(2)(ii)(b)(2), and (b)
if any General Partner's Capital Account has a deficit balance
(after giving effect to all capital contributions, distributions
and allocations of Profits and Losses for all fiscal years,
including the year during which such liquidation occurs), such
General Partner shall contribute to the capital of the Partnership
an aggregate amount equal to but not greater than the lesser of the
amount necessary to restore such deficit balance to zero in
compliance with Treas. Regs. sec. 1.704-1(b)(2)(ii)(b)(3) or 1.01% of
the aggregate capital contributions of the Limited Partners.
Distributions pursuant to the preceding sentence may be distributed
to a trust established for the benefit of the partners for the
purposes of liquidating Partnership assets, collecting amounts owed
to the Partnership, and paying any contingent or unforeseen
liabilities or obligations of the Partnership or of the General
Partner arising out of or in connection with the Partnership. The
assets of any such trust shall be distributed to the partners from
time to time, in the reasonable discretion of the General Partner,
in the same proportions as the amount distributed to such trust by
the Partnership would otherwise have been distributed to the
partners pursuant to this Agreement.
C. No Limited Partner shall have the right to demand or
receive Property other than cash upon dissolution and termination
of the Partnership.
D. Each holder of an Interest shall look solely to the
assets of the Partnership for all distributions with respect to the
Partnership and his capital contribution thereto and shall have no
recourse (upon dissolution or otherwise) against any General
Partner or any Limited Partner.
ARTICLE XI
BOOKS AND RECORDS, ACCOUNTING, TAX ELECTIONS, ETC.
11.1. Books and Records. Books and records of the
Partnership shall be maintained at the principal office of the
Partnership or at any other place designated by the General Partner
and shall be available for examination by any partner or his duly
authorized representatives at any reasonable time. Any partner, or
his duly authorized representatives, upon paying the costs of
collection, duplication and mailing, shall be entitled to a copy of
the list of the names and addresses of the Limited Partners
(including the number of Interests owned by each of them).
11.2. Fiscal Year. The fiscal year of the Partnership shall
commence on January 1 and terminate on December 31 of each year.
11.3. Partnership Funds. The funds of the Partnership shall
be deposited in such banking institutions as the General Partner
shall determine, and withdrawals shall be made only in the regular
course of the Partnership's business on such signature or
signatures as the General Partner may determine. All deposits and
other funds not needed in the operation of the business may be
invested in certificates of deposit, short-term money-market
instruments, government securities, money-market funds or similar
investments as the General Partner shall determine.
11.4. Depreciation and Tax Elections. The General Partner
shall make such elections under the tax laws of the United States
and other relevant jurisdictions as to the treatment of items of
Partnership income, gain, loss, deduction and credit, and as to all
other relevant matters as it believes necessary or desirable. With
respect to all depreciable assets of the Partnership, the
Partnership may elect to use accelerated depreciation methods. The
Partnership may change to or elect some other method of
depreciation so long as such other method is, in the opinion of the
General Partner, the most advantageous to a majority in Interest of
the Limited Partners.
11.5. Designation of Tax Matters Partner. The General
Partner is hereby authorized to act as tax matters partner (the
"Tax Matters Partner") of the Partnership, as provided in
regulations pursuant to Section 6231 of the Code. Each partner, by
the execution of this Agreement, consents to such designation of
the Tax Matters Partner and agrees to execute, certify,
acknowledge, deliver, swear to, file and record at the appropriate
public offices such documents as may be necessary or appropriate to
evidence such consent.
11.6. Duties of Tax Matters Partner. To the extent and in
the manner provided by applicable law and regulations, the Tax
Matters Partner shall furnish the name, address, profits interest
and taxpayer identification number of each partner, including any
substituted or additional Limited Partner, to the Secretary of the
Treasury or his delegate (the "Secretary").
To the extent and in the manner provided by applicable law and
regulations, the Tax Matters Partner shall keep each partner
informed of the administrative and judicial proceedings for the
adjustment at the Partnership level of any item required to be
taken into account by a partner for income tax purposes (such
administrative proceedings referred to hereinafter as "tax audit"
and such judicial proceeding referred to hereinafter as "judicial
review").
11.7. Authority of Tax Matters Partner. On behalf of the
Partnership, the Tax Matters Partner is hereby authorized, but is
not required:
(i) to enter into any settlement agreement with the
Internal Revenue Service or the Secretary with respect to any
tax audit or judicial review, in which agreement the Tax
Matters Partner may expressly state that such agreement shall
bind the other partners, except that such settlement agreement
shall not bind any partner who (within the time prescribed
pursuant to the Code and regulations thereunder) files a
statement with the Secretary providing that the Tax Matters
Partner shall not have the authority to enter into a
settlement agreement on behalf of such partner;
(ii) in the event that a notice of a final administrative
adjustment at the Partnership level of any item required to be
taken into account by a partner for tax purposes (a "final
adjustment") is mailed to the Tax Matters Partner, to seek
judicial review of such final adjustment, including the filing
of a petition for readjustment with the Tax Court, the
District Court of the United States for the district in which
the Partnership's principal place of business is located, or
the United States Claims Court;
(iii) to intervene in any action brought by any other
partner for judicial review of a final adjustment;
(iv) to file a request for an administrative adjustment
with the Secretary at any time and, if any part of such
request is not allowed by the Secretary, to file a petition
for judicial review with respect to such request;
(v) to enter into an agreement with the Internal Revenue
Service to extend the period for assessing any tax which is
attributable to any item required to be taken into account by
a partner for tax purposes, or an item affected by such item;
and
(vi) to take any other action on behalf of the partners
or the Partnership in connection with any administrative or
judicial tax proceeding to the extent permitted by applicable
law or regulations.
11.8. Expenses of Tax Matters Partner. The Partnership shall
indemnify and reimburse the Tax Matters Partner for all expenses,
including legal and accounting fees, claims, liabilities, losses
and damages incurred in connection with any administrative or
judicial proceeding with respect to the tax liability of the
partners. The payment of all such expenses shall be made before
any distributions are made from Cash Available for Distribution or
any discretionary reserves are set aside by the General Partner.
Neither the General Partner, or any Affiliate, nor any other Person
shall have any obligation to provide funds for such purpose. The
taking of any action and the incurring of any expense by the Tax
Matters Partner in connection with any such proceeding, except to
the extent required by law, is a matter in the sole discretion of
the Tax Matters Partner and the provisions of limitations of
liability of the General Partner and indemnification set forth in
this Agreement shall be fully applicable to the Tax Matters Partner
in its capacity as such.
ARTICLE XII
MEETINGS AND VOTING RIGHTS OF THE LIMITED PARTNERS
12.1. Meetings.
A. Meetings of the Partnership may be called by the General
Partner or the Limited Partners holding more than 10% of the then
outstanding Interests, for any matters for which the Limited
Partners may vote as set forth in this Agreement. A list of the
names and addresses of all Limited Partners shall be maintained as
part of the books and records of the Partnership and shall be made
available to any Limited Partner or his representative at his cost
on request.
B. Upon receipt of a written request either in Person or by
certified mail stating the purpose(s) of the meeting, the General
Partner shall provide all Limited Partners within ten days after
receipt of said request, written notice (either in Person or by
certified mail) of the meeting and the purpose of such meeting to
be held on a date not less than fifteen nor more than sixty days
after receipt of said request, at a time and place convenient to
the Limited Partners.
12.2. Voting Rights of the Limited Partners. A majority in
Interest of the Limited Partners, without the concurrence of the
General Partner, may at a meeting duly called:
(i) amend this Agreement; provided that such amendment
(a) shall not in any manner allow the Limited Partners to take
part in the control of the Partnership's business, (b) shall
not, without the Consent of the General Partner, alter the
rights, powers or duties of the General Partner, alter the
Interest of the General Partner in Profits, Losses or
distributions, or alter any of the provisions of Section 8.4,
or (c) shall not, without the Consent of all Limited Partners
alter the Interests of the Limited Partners in Profits, Losses
or distributions;
(ii) sell or otherwise dispose of, at one time, all or
substantially all the assets of the Partnership;
(iii) dissolve the Partnership; or
(iv) as provided in Article VIII, remove any General
Partner, elect a replacement General Partner for a deceased,
bankrupt, removed, or incompetent General Partner, or elect an
additional General Partner with the Consent of an existing
General Partner.
ARTICLE XIII
REPORTS
13.1. Annual Reports. Within 120 days after the end of each
fiscal year, the General Partner shall send to each Person who was
a Limited Partner at any time during the year then ended:
(i) a balance sheet as of the end of the Partnership's
fiscal year and statements of income, partners' equity, and a
cash flow statement, for the year then ended, all of which
shall be prepared in accordance with generally accepted
accounting principles and accompanied by an auditor's report
containing an opinion of an independent certified public
accountant or independent public accountant; and
(ii) a report of the activities of the Partnership during
the period covered by the report. Such report shall set forth
distributions to Limited Partners for the period covered
thereby and shall separately identify distributions from (a)
Cash Available for Distribution during the period, (b) cash
distributions during a period which had been held as Reserves,
(c) Sale Proceeds, (d) Reserves from the capital contributions
of Limited Partners and (e) the amount of all fees and other
compensation and distributions paid by the Partnership for
such year to the General Partner or any Affiliates including
a breakdown of the reimbursable costs permitted under Section
7.2A(xv).
13.2. Tax Information. Within 75 days after the end of each
fiscal year, the General Partner shall send to each Person who was
a Limited Partner at any time during the fiscal year then ended,
such tax information as shall be necessary for the preparation by
such Limited Partner of his federal income tax return.
13.3. Annual Valuations. Within 90 days after the end of
each calendar year, the Partnership will provide to its
pension/profit-sharing plan investors an annual valuation which may
be used to satisfy the asset value requirements of ERISA.
13.4. Quarterly Reports. Within 45 days after the end of
each quarter, the General Partner will furnish a report of all
services rendered to and all fees received from the Partnership by
the General Partner and Affiliates, unaudited statements of
financial condition, operations, sources and applications of funds,
and cash flow and a report on the activities of the Partnership
which contains the information specified by Form 10-Q (if such
report is required to be filed by the Securities and Exchange
Commission).
13.5. Other Reports. The General Partner shall send to each
Limited Partner at least quarterly, a special report of Property
acquisitions within the prior quarter, until all the Partnership
proceeds are invested, and where the General Partner or Affiliates
receive fees, within 60 days of the end of each quarter wherein
such fees were received, a report setting forth in detail the
services rendered and the amount of such fees. Further, the
General Partner shall send such further reports to the Limited
Partners as may be set forth in any registration statement filed or
to be filed with the Securities and Exchange Commission relating to
the sale of Interests.
ARTICLE XIV
AMENDMENTS TO PARTNERSHIP AGREEMENT
14.1. Amendments with Consent of the Limited Partners.
Amendments may be made to this Agreement from time to time by the
General Partner with the Consent of a majority in Interest of the
Limited Partners; provided, however, that without the Consent of
the partners to be adversely affected by the amendment, this
Agreement may not be amended so as to:
(i) convert a Limited Partner's Interest into a General
Partner's Interest;
(ii) otherwise modify the limited liability of a Limited
Partner; or
(iii) alter the Interest of a partner in Profit, Loss or
distributions of Cash Available for Distribution or Sales
Proceeds.
14.2. Amendments Without Consent of the Limited Partners.
Amendments may be made to this Agreement from time to time by the
General Partner, without the Consent of any of the Limited
Partners:
(i) to add to the representations, duties or obligations
of the General Partner or surrender any right or power granted
to the General Partner herein, for the benefit of the Limited
Partners;
(ii) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other
provision herein, or to add other provisions with respect to
matters arising under this Agreement which will not be
inconsistent with the provisions of this Agreement;
(iii) to delete or add any provision to this Agreement
required to be so deleted or added by any federal or state
agency deemed to be for the benefit or protection of the
Limited Partners;
(iv) to effectuate, after completion of the acquisition
phase of the Partnership's existence, the voluntary withdrawal
of the general partners of Decade Companies or either of them
therefrom and substitute in their place a corporation having
a net worth in excess of $1,000,000;
(v) to reflect the incorporation of the General Partner
provided it has a net worth of $1,000,000; or
(vi) to better assure, in the opinion of counsel to the
Partnership, that the Partnership will continue to be
classified as a partnership for purposes of federal income
taxes.
14.3. Recording of Amendments. In making any amendments,
there shall be prepared and filed for recordation by the General
Partner such documents and certificates as shall be required to be
prepared and filed under the laws of Wisconsin.
ARTICLE XV
MISCELLANEOUS PROVISIONS
15.1. Appointment of the General Partner as Attorney-in-Fact.
A. Each Limited Partner, including each substituted Limited
Partner, by the execution of this Agreement, irrevocably
constitutes and appoints the General Partner his true and lawful
attorney-in-fact with full power and authority in his name, place
and xxxxx to execute, acknowledge, deliver, swear to, file and
record at the appropriate public offices such documents as may be
necessary or appropriate to carry out the provisions of this
Agreement, including, but not limited to:
(i) all certificates and other instruments (including
counterparts of this Agreement), and any amendment thereof,
which the General Partner deems appropriate to form, qualify
or continue the Partnership as a limited partnership in the
jurisdictions in which the Partnership may conduct business or
in which such formation, qualification or continuation is, in
the opinion of the General Partner, necessary to protect the
limited liability of the Limited Partners;
(ii) all amendments to this Agreement adopted in
accordance with the terms hereof and all instruments which the
General Partner deems appropriate to reflect a change or
modification of the Partnership in accordance with the terms
of this Agreement; or
(iii) all conveyances and other instruments which the
General Partner deems appropriate to reflect the dissolution
and termination of the Partnership.
This power of attorney may be exercised by the General Partner
acting alone for each Limited Partner, or by listing all of the
Limited Partners executing any instrument with a single signature
of such General Partner as an attorney-in-fact for all of them.
B. The appointment by all Limited Partners of the General
Partner as attorney-in-fact shall be deemed to be a power coupled
with an interest, in recognition of the fact that each of the
partners under this Agreement will be relying upon the power of the
General Partner to act as contemplated by this Agreement in any
filing and in any other action on behalf of the Partnership, and
shall survive the bankruptcy, death, adjudication of incompetence
or insanity or dissolution of any Person hereby giving such power
and the transfer or assignment of all or any part of his Interests.
The foregoing power of attorney of a transferor Limited Partner
shall survive such transfer only until such time as the transferee
shall have been admitted to the Partnership as a substituted
Limited Partner and all required documents and instruments shall
have been duly executed, filed and recorded to effect such
substitution.
15.2. Ownership by Limited Partner of Interest in General
Partner or Affiliates. No Limited Partner shall at any time,
either directly or indirectly, own any stock or other interest in
the General Partner or in any Affiliates of the General Partner if
such ownership by itself or in conjunction with the stock or other
interest owned by other Limited Partners would, in the opinion of
counsel for the Partnership, jeopardize the classification of the
Partnership as a partnership for federal income tax purposes. The
General Partner shall be entitled to make such reasonable inquiry
of the Limited Partners and prospective Limited Partners as is
required to establish compliance by the Limited Partners with the
provisions of this Section 15.2.
15.3. Binding Provisions. The covenants and agreements
contained herein shall be binding upon, and inure to the benefit of
the heirs, executors, administrators, personal representatives,
successors and assigns of the respective parties hereto.
15.4. Applicable Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of
Wisconsin.
15.5. Execution and Counterparts. This Agreement may be
executed in several counterparts, all of which together shall
constitute one agreement binding on all parties hereto,
notwithstanding that all the parties have not signed the same
counterpart. Each Limited Partner, substituted Limited Partner,
additional General Partner, and successor General Partner shall
become a signatory hereof by signing such number of counterpart
signature pages to this Agreement or such other instrument or
instruments, and in such manner, as the General Partner shall
determine. By so signing, each Limited Partner, substituted
Limited Partner, additional General Partner or successor General
Partner, as the case may be, shall be deemed to have adopted, and
to have agreed to be bound by, all the provisions of this
Agreement; provided, however, that no such counterpart shall be
binding until it shall have been accepted by the General Partner.
15.6. Separability of Provisions. Each provision of this
Agreement shall be considered separable and if for any reason any
provision or provisions hereof are determined to be invalid and
contrary to any existing or future laws, such invalidity shall not
impair the operation of or affect those portions of this Agreement
which are valid.
15.7. Headings. Article and Section headings are for
descriptive purposes only and shall not control or alter the
meaning of this Agreement as set forth in the text.
15.8. Interpretation. When the context in which words are
used in this Agreement indicates that such is the intent, words in
the singular shall include the plural and the masculine shall
include the feminine and neuter and vice versa.
IN WITNESS WHEREOF, the undersigned have executed this Amended
and Restated Agreement as of the date first above written.
GENERAL PARTNER:
Decade Companies
By /s/ XXXXXXX XXXXXXXXXX
Xxxxxxx Xxxxxxxxxx
A General Partner of
Decade Companies
XXXXXXX XXXXXXXXXX, a General
Partner of Decade Companies, and as
Attorney in Fact for All
Limited Partners
By /s/ XXXXXXX XXXXXXXXXX
Xxxxxxx Xxxxxxxxxx
Agreement; provided, however, that no such counterpart shall be
binding until it shall have been accepted by the General Partner.
15.6. Separability of Provisions. Each provision of this
Agreement shall be considered separable and if for any reason any
provision or provisions hereof are determined to be invalid and
contrary to any existing or future laws, such invalidity shall not
impair the operation of or affect those portions of this Agreement
which are valid.
15.7. Headings. Article and Section headings are for
descriptive purposes only and shall not control or alter the
meaning of this Agreement as set forth in the text.
15.8. Interpretation. When the context in which words are
used in this Agreement indicates that such is the intent, words in
the singular shall include the plural and the masculine shall
include the feminine and neuter and vice versa.
IN WITNESS WHEREOF, the undersigned have executed this Amended
and Restated Agreement as of the date first above written.
GENERAL PARTNER:
Decade Companies
By /s/ Xxxxxxx Xxxxxxxxxx
Xxxxxxx Xxxxxxxxxx
A General Partner of
Decade Companies
XXXXXXX XXXXXXXXXX, a General
Partner of Decade Companies, and as
Attorney in Fact for All
Limited Partners
By /s/ Xxxxxxx Xxxxxxxxxx
Xxxxxxx Xxxxxxxxxx
