EXHIBIT 10.07
OPERATING AGREEMENT
OF
CEDAR-FRANKLIN VILLAGE 2 LLC
This OPERATING AGREEMENT (this "Agreement") of CEDAR-FRANKLIN VILLAGE 2
LLC (the "Company") is made and entered into to be effective for all purposes as
of October 21, 2004 by Cedar Shopping Centers Partnership, L.P. ("LP"), as the
sole equity member and such other persons as may from time to time be admitted
as members of the Company in accordance with the terms of this Agreement and the
Delaware Act (as that term is hereinafter defined). As used in this Agreement,
the term "Member" (whether one or more) shall mean LP and any other persons or
entities admitted as a member of the Company in accordance with this Agreement
and the Delaware Act (so long as they are members of the Company).
R E C I T A L S:
WHEREAS, the Company was formed as a limited liability company pursuant
to the Delaware Limited Liability Company Act, 6 Del. C. xx.xx. 18-101, et seq.
(as amended from time to time, the "Delaware Act"), by the filing of a
Certificate of Formation for the Company with the Secretary of State of
Delaware;
NOW, THEREFORE, the undersigned hereby adopts the following as its
"limited liability company agreement" (as that term is used in the Delaware
Act):
1. FORMATION. The Certificate of Formation, the formation of the
Company as a limited liability company under the Delaware Act, and all actions
taken by the person who executed and filed the Certificate of Formation are
hereby adopted and ratified. The affairs of the Company and the conduct of its
business shall be governed by the terms and subject to the conditions set forth
in this Agreement, as amended from time to time. The Member is hereby authorized
and directed to file any necessary amendments to the Certificate of Formation of
the Company in the office of the Secretary of State of the State of Delaware and
such other documents as may be required or appropriate under the Delaware Act or
the laws of any other jurisdiction in which the Company may conduct business or
own property.
2. NAME AND PRINCIPAL PLACE OF BUSINESS. The name of the Company is
Cedar-Franklin Village 2 LLC. The Member may change the name of the Company or
adopt such trade or fictitious names for use by the Company as the Member may
from time to time determine. All business of the Company shall be conducted
under such names and title to all assets or property owned by the Company shall
be held in such names. The principal place of business and office of the company
shall be c/o Cedar Shopping Centers Partnership, L.P., 00 Xxxxx Xxxxxx Xxxxxx,
Xxxxx 000, Xxxx Xxxxxxxxxx, Xxx Xxxx 00000, or at such other place or places as
the Member may from time to time designate.
3. REGISTERED AGENT AND REGISTERED OFFICE. The name of the Company's
registered agent for service of process is Corporation Service Company, and the
address of the Company's registered agent and the address of the Company's
registered office in the State of Delaware is 0000 Xxxxxxxxxxx Xxxx, Xxxxx 000,
Xxxxxxxxxx, Xxxxxxxx 00000. The registered agent and the registered office of
the Company may be changed from time to time by the Member.
4. TERM. The term of the Company shall be deemed to have commenced on
the filing of the Certificate of Formation in the office of Secretary of State
of the State of Delaware and shall continue until December 31, 2050, unless
sooner terminated or further extended pursuant to the provisions of this
Agreement by the Member. The existence of the Company as a separate legal entity
shall continue until cancellation of the Certificate of Formation as provided in
the Delaware Act.
5. PURPOSE. The purpose and business of the Company shall be to (a)
acquire and own a one hundred percent (100%) membership interest in
Cedar-Franklin Village LLC (the "Owner LLC"), whose
purposes are:
(i) to acquire, own, hold, lease, operate, manage, maintain, develop and
improve, the real property commonly known as "Franklin Village" located
in Franklin, Massachusetts (the "Property");
(ii) to enter into and perform its obligations under the documents
evidencing and/or securing a loan to Owner LLC (the "Loan Documents");
(iii) to sell, transfer, service, convey, dispose of, pledge, assign, borrow
money against, finance, refinance or otherwise deal with the Property
to the extent permitted under the Loan Documents; and
(iv) to engage in any lawful act or activity and to exercise any powers
permitted to limited liability companies organized under the laws of
the State of Delaware that are related or incidental to and necessary,
convenient or advisable for the accomplishment of the above-mentioned
purposes;
and (b) engage in any activity and take any action which limited liability
companies may take that is incidental, necessary and appropriate to accomplish
the foregoing.
6. MEMBERS.
(a) LP, whose address is set forth opposite its name in the
signature page of this Agreement, is the sole member of the Company and shall be
shown as such on the books and records of the Company. Except as expressly
permitted by this Agreement, no other person shall be admitted as a member of
the Company, and no additional interest in the Company shall be issued, without
the approval of the Member.
(b) Notwithstanding any other provision of this Agreement, the
Bankruptcy of the Member shall not cause the Member to cease to be a member of
the Company and upon the occurrence of such an event, the business of the
Company shall continue without dissolution. For purposes of this Section 6,
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Bankruptcy means, with respect to any person or entity, if such person or entity
(i) makes an assignment for the benefit of creditors, (ii) files a voluntary
petition in bankruptcy, (iii) is adjudged bankrupt or insolvent, or has entered
against it an order for relief, in any bankruptcy or insolvency proceedings,
(iv) files a petition or answer seeking for itself any reorganization,
arrangement, composition, readjustment, liquidation or similar relief under any
statute, law or regulation, (v) files an answer or other pleading admitting or
failing to contest the material allegations of a petition filed against it in
any proceeding of this nature, (vi) seeks, consents to or acquiesces in the
appointment of a trustee, receiver or liquidator of the person or entity or of
all or any substantial part of its properties, or (vii) if 120 days after the
commencement of any proceeding against the person or entity seeking
reorganization, arrangement, composition, readjustment, liquidation or similar
relief under any statute, law or regulation, if the proceeding has not been
dismissed, or if within 90 days after the appointment without such person's or
entity's consent or acquiescence of a trustee, receiver or liquidator of such
person or entity or of all or any substantial part of its properties, the
appointment is not vacated or stayed, or within 90 days after the expiration of
any such stay, the appointment is not vacated. The foregoing definition of
"Bankruptcy" is intended to replace and shall supersede and replace the
definition of "Bankruptcy" set forth in Sections 18-101(1) and 18-304 of the
Delaware Act.
7. MANAGEMENT. In accordance with Section 18-402 of the Delaware Act,
management of the Company shall be vested in the Member. The Member shall have
the power to do any and all acts necessary, convenient or incidental to or for
the furtherance of the purposes described herein, including all powers,
statutory or otherwise, possessed by members of a limited liability company
under the laws of the State of Delaware. The Member has the authority to bind
the Company. Notwithstanding anything to the contrary contained herein, the
provisions of this Section 7 are subject to the provisions contained in Section
20 hereof.
8. OFFICERS. The Member may, from time to time as it deems advisable,
appoint officers of the Company (the "Officers") and assign in writing titles
(including, without limitation, President, Vice President, Secretary, Assistant
Secretary and Treasurer) to any such person. Unless the Member decides
otherwise, if the title is one commonly used for officers of a business
corporation formed under the General Corporation Law of the State of Delaware,
the assignment of such title shall constitute the delegation to such person of
the authorities and duties that are normally associated with that office. Any
delegation pursuant to this Section 8 may be revoked at any time by the Member.
The Member hereby initially appoints Xxx X. Xxxxxx, President; Xxxxxx X. Xxxxxx,
Vice President and Treasurer, Xxxxxx X. Xxxxxxxx, Secretary and Xxxx X. Xxxxxxx,
Assistant Secretary.
9. INITIAL CAPITAL CONTRIBUTION. The Member has contributed to the
Company an initial contribution to the capital of the Company.
10. ADDITIONAL CAPITAL CONTRIBUTIONS. The Member is not required to
contribute any additional capital to the Company other than the initial
contributions heretofore made. The Member will not have any obligation to
restore any negative or deficit balance in its capital account, including any
negative or deficit balance in its capital account upon liquidation and
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dissolution of the Company. Any additional funds required by the Company to meet
its cash requirements shall, to the extent possible, be provided by Company
borrowings from third parties, upon such terms and conditions as determined
appropriate by the approval of the Member; provided, however, that in lieu of
causing the Company to borrow from third parties, the Member may from time to
time make additional capital contributions to the Company.
11. TAX MATTERS. The undersigned intend for the Company to be treated
as a partnership for federal income tax purposes if the Company has two or more
members, and otherwise as an entity that is disregarded as an entity separate
from its owner for federal income tax purposes pursuant to Treasury Regulation
Section 301.7701-3.
12. DISTRIBUTIONS. The Company shall, as soon as reasonably practical,
make monthly distributions and biannual adjusting distributions of the Company's
net cash flow available for distribution, including distributions of net cash
flow from operations, net proceeds of any interim capital transaction and net
proceeds available upon dissolution and winding up of the Company (such net cash
flow, net proceeds from interim capital transactions and net proceeds upon
dissolution and winding up of the Company being herein sometimes referred to as
the "Distributable Cash") (in each case after establishment of appropriate and
reasonable reserves) to the Member. Notwithstanding any provision to the
contrary contained in this Agreement, the Company, or any member on behalf of
the Company, shall not be required to make a distribution to the Member on
account of its interest in the Company if such distribution would violate the
Delaware Act or any other applicable law.
13. DISSOLUTION AND TERMINATION.
(a) The Company shall be dissolved and its business wound up
upon the earliest to occur of any of the following events:
(i) The expiration of the term of the Company;
(ii) The sale of all or substantially all of the
Company's assets.
(iii) The termination of the legal existence of the
last remaining member of the Company or the occurrence of any
other event which terminates the continued membership of the
last remaining member of the Company in the Company unless the
business of the Company is continued in a manner permitted by
this Agreement or the Delaware Act; or
(iv) The entry of a decree of judicial dissolution
under Section 18-802 of the Delaware Act.
Upon the occurrence of any event that causes the last
remaining member of the Company to cease to be a member of the Company, to the
fullest extent permitted by law, the personal representative of such member is
hereby authorized to, and shall, within 90 days after the occurrence of the
event that terminated the continued membership of such member in the Company,
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agree in writing (i) to continue the Company and (ii) to the admission of the
personal representative or its nominee or designee, as the case may be, as a
substitute member of the Company, effective as of the occurrence of the event
that terminated the continued membership of the last remaining member of the
Company in the Company.
(b) Intentionally omitted.
(c) The Company shall not dissolve, liquidate or terminate
upon the death, Bankruptcy, insolvency, dissolution, liquidation, termination,
resignation, or removal of the Member.
(d) Upon dissolution, the Company's business shall be
liquidated in an orderly manner. The Member shall act as the liquidating trustee
to wind up the business of the Company pursuant to this Agreement. If there
shall be no remaining Member, the successor-in-interest of the Member may
approve one or more liquidating trustees to act as the liquidator in carrying
out such liquidation. In performing its duties, the liquidator is authorized to
sell, distribute, exchange or otherwise dispose of the assets of the Company in
accordance with the Delaware Act and in any reasonable manner that the
liquidator shall determine to be in the best interest of the Member or its
successors-in-interest.
(e) In the event it becomes necessary in connection with the
liquidation of the Company to make a distribution of property in kind, such
property shall be transferred and conveyed to the Member.
(f) The Company shall terminate when (i) all of the assets of
the Company, after payment of or due provision for all debts, liabilities and
obligations of the Company, shall have been distributed to the Member in the
manner provided for in this Agreement and (ii) the Certificate of Formation of
the Company shall have been canceled in the manner required by the Delaware Act.
14. INDEMNIFICATION. The Member shall not be liable to the Company for
monetary damages for any losses, claims, damages or liabilities arising from any
act or omission performed or omitted by it arising out of or in connection with
this Agreement or the Company's business or affairs, except for any such loss,
claim, damage or liability primarily attributable to the Member's fraud, gross
negligence or willful misconduct. The Company shall, to the fullest extent
permitted by applicable law, indemnify, defend and hold harmless the Member
against any losses, claims damages or liabilities to which the Member may become
subject in connection with any matter arising out of or in connection with this
Agreement or the Company's business or affairs, except for any such loss, claim,
damage or liability primarily attributable to the Member's fraud, gross
negligence or willful misconduct. If the Member becomes involved in any capacity
in any action, proceeding or investigation in connection with any matter arising
out of or in connection with this Agreement or the Company's business or
affairs, the Company shall reimburse the Member for its reasonable legal fees
and other reasonable out-of-pocket expenses (including the cost of any
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investigation and preparation) as they are incurred in connection therewith,
provided that the Member shall promptly repay to the Company the amount of any
such reimbursed expenses paid to it if it shall ultimately be determined that
the Member was not entitled to be indemnified by the Company in connection with
such action, proceeding or investigation. If for any reason (other than the
fraud, gross negligence or willful misconduct of the Member) the foregoing
indemnification is unavailable to the Member, or insufficient to hold it
harmless, then the Company shall contribute to the amount paid or payable by the
Member as a result of such loss, claim, damage, liability or expense in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Member on the other hand or, if such allocation
is not permitted by applicable law, to reflect not only the relative benefits
referred to above but also any other relevant equitable considerations. The
provisions of this Paragraph 14 shall survive any termination of this Agreement.
Notwithstanding anything to the contrary contained in this Agreement, the
obligations of the Company or the Member under this Paragraph 14 shall (i) be in
addition to any liability which the Company or the Member may otherwise have and
(ii) inure to the benefit of the Member, its affiliates and their respective
members, directors, officers, employees, agents and affiliates and any
successors, assigns, heirs and personal representatives of such persons.
15. LIABILITY OF THE MEMBER. Except as otherwise expressly provided in
the Delaware Act, the debts, obligations and liabilities of the Company, whether
arising in contract, tort or otherwise, shall be solely the debts, obligations
and liabilities of the Company, and the Member shall not be obligated personally
for any such debt, obligation or liability of the Company solely by reason of
being the member. Except as otherwise expressly provided in the Delaware Act,
the liability of the Member shall be limited to the amount of capital
contributions, if any, required to be made by the Member in accordance with the
provisions of this Agreement, but only when and to the extent the same shall
become due pursuant to the provisions of this Agreement.
16. WAIVER OF PARTITION AND NATURE OF INTEREST IN THE COMPANY. To the
fullest extent permitted by law, the Member hereby irrevocably waives any right
or power that the Member might have to cause the Company or any of its assets to
be partitioned, to cause the appointment of a receiver for all or any portion of
the assets of the Company, to compel any sale of all or any portion of the
assets of the Company pursuant to any applicable law, or to file a complaint or
to institute any proceeding at law or in equity to cause the termination,
dissolution and liquidation of the Company. The Member has been induced to enter
into this Agreement in reliance upon the waivers set forth in this Paragraph 16,
and without such waivers, the Member would not have entered into this Agreement.
The Member shall not have any interest in any specific assets of the Company.
17. BOOKS, RECORDS, ACCOUNTING AND REPORTS. The Company shall maintain,
or cause to be maintained, in a manner customary and consistent with good
accounting principles, practices and procedures, a comprehensive system of
office records, books and accounts (which records, books and accounts shall be
and remain the property of the Company) in which shall be entered fully and
accurately each and every financial transaction with respect to the ownership
and operation of the property of the Company. Such books and records of account
shall be prepared and maintained at the principal place of business of the
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Company or such other place or places as may from time to time be determined by
the Member. The Member or its duly authorized representative shall have the
right to inspect, examine and copy such books and records of account at the
Company's office during reasonable business hours. A reasonable charge for
copying books and records may be charged by the Company. The books of the
Company shall be kept on the accrual basis in accordance with generally accepted
accounting practices and principles. The Company shall report its operations for
tax purposes on the accrual method. The fiscal year of the Company shall end on
December 31 of each year, unless a different fiscal year is elected by the
Member and acceptable by the Code.
18. THE COMPANY ACCOUNTANT. The Company shall retain as the regular
accountant and auditor for the Company (the "Company Accountant") a
nationally-recognized accounting firm designated by the Member. The fees and
expenses of the Company Accountant shall be a Company expense.
19. MISCELLANEOUS.
(a) Further Assurances. The Member agrees to execute,
acknowledge, deliver, file, record and publish such further instruments and
documents, and do all such other acts and things as may be required by law, or
as may be required to carry out the intent and purposes of this Agreement.
(b) Successors and Assigns. This Agreement shall be binding
upon the Member and its respective executors, administrators, legal
representatives, heirs, successors and assigns.
(c) Severability. In case any one or more of the provisions
contained in this Agreement or any application thereof shall be invalid, illegal
or unenforceable in any respect, the validity, legality and enforceability of
the remaining provisions contained herein and any other application thereof
shall not in any way be affected or impaired thereby.
20. SPE REQUIREMENTS.
(a) The purpose of the Company is limited to the purpose
described in Paragraph 5 hereof.
(b) The Company's ability to incur indebtedness is limited to
equipment leasing, equipment financing and trade payables incurred in the
ordinary course of business, relating to its role as sole member of the Owner
LLC.
(c) The Company shall:
(i) Maintain books and records separate from any
other person or entity;
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(ii) Maintain its bank accounts separate from any
other person or entity;
(iii) Not commingle assets with those of any other
entity and shall hold all of its assets in its own name;
(iv) Conduct its own business in its own name;
(v) Maintain separate financial statements, provided,
however, that in lieu thereof, the Company's assets may be
included in a consolidated financial statement of its
affiliate;
(vi) Pay its own liabilities out of its own funds;
(vii) Except for capital contributions or capital
distributions permitted under the terms of this Agreement, not
enter into any transaction with an affiliate except on
commercially reasonable terms similar to those available to
unaffiliated parties in an arm's length transaction;
(viii) Pay the salaries of its own employees, if any,
and maintain a sufficient number of employees in light of its
contemplated business operations;
(ix) Not guarantee or become obligated for the debts
of any other entity or hold out its credit as being available
to satisfy the obligations of others;
(x) Not acquire obligations or securities of its
Member;
(xi) Allocate fairly and reasonably any overhead for
shared office space;
(xii) Use separate stationery, invoices and checks;
(xiii) Not pledge its assets for the benefit of any
other entity;
(xiv) Hold itself out as a separate entity;
(xv) Correct any known misunderstanding regarding its
separate identity;
(xvi) Maintain adequate capital in light of its
contemplated business operations;
(xvii) Not identify itself as a division of any other
person or entity;
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(xviii) Not hold, form or acquire any subsidiaries
other than Owner LLC;
(xix) Not make loans to any other person or entity or
hold or buy evidence of indebtedness issued by another person
or entity;
(xx) Observe all limited liability company
formalities; and
(xxi) File its tax returns separate from any other
entity, except to the extent that the Company is treated as a
"disregarded entity" for tax purposes and is not required to
file tax returns under applicable law .
21. NON-COMPLIANCE. Failure of the Company, or the Member on behalf of
the Company, to comply with any of the foregoing covenants or any other
covenants contained in this Agreement shall not affect the status of the Company
as a separate legal entity or the limited liability of the Member.
22. GOVERNING LAW. This Agreement shall be governed by and construed
under the laws of the State of Delaware (without regard to conflict of laws
principles), all rights and remedies being governed by said laws.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date set forth in the introductory paragraph hereof.
Address Member
00 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000 CEDAR SHOPPING CENTERS
Port Xxxxxxxxxx, Xxx Xxxx 00000 PARTNERSHIP, L.P.
By: Cedar Shopping Centers, Inc.,
its general partner
By:
----------------------------
Xxxxxx X. Xxxxxx
Vice President
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