Ex-10.55
Prime Retail, Inc.
Prime Retail, L.P.
000 Xxxx Xxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxxx, XX 00000
April 24, 2001
Xx. Xxxxxxx X. Xxxxxxxxx, Xx.
000 Xxxx Xxxx Xxxx
Xxxxxxx Xxxx, Xxxxxxxx 00000
Re: Separation Agreement
Dear Xxxx:
Reference is made to that certain Separation Agreement dated August 24,
2000 by and between Prime Retail, Inc., Prime Retail, L.P. and you. Capitalized
terms that used herein but are not otherwise defined shall have the meanings set
forth in the Agreement.
This letter will confirm our understanding that, in consideration for your
capital contribution of $200,000 in immediately available funds to the Operating
Partnership, receipt of which is hereby acknowledged, the Operating Partnership
will specially allocate to you, as a limited partner of the Operating
Partnership for each taxable year of the Operating Partnership for federal
income tax purposes in which the Operating Partnership reports (as is required
by Section 2(c) of the Agreement, superceding any provisions in the Operating
Partnership's Partnership Agreement to the contrary) the payments made to you
under Section 2(a) of the Agreement as "guaranteed payments" within the meaning
of Section 707(c) of the Internal Revenue Code of 1986, as amended (the "Code"),
the corresponding deductions (if any) resulting from such guaranteed payments
(the "Annual Corresponding Deductions").
The special allocation of Annual Corresponding Deductions to you for any
Operating Partnership taxable year shall be reduced by the excess (if any) of
(1) the excess (if any) of (a) the Annual Corresponding Deductions for an
Operating Partnership taxable year over (b) the portion of such Annual
Corresponding Deductions that otherwise would be allocated to Prime Retail,
Inc., absent this letter agreement (and the similar letter agreement for Xxxxxxx
Xxxxxxxxx), over (2) the other items of deductible expense allocated to Prime
Retail, Inc. for such Operating Partnership taxable year. However, that to the
extent the special allocation of Annual Corresponding Deductions to you for any
such Operating Partnership shall carry forward this shortfall and supplement the
special allocation of Annual Corresponding Deductions in subsequent Operating
Partnership taxable years with special allocations of other items of deductible
expense that would otherwise be allocated to Prime Retail, Inc. (subject to
their being any such allocable items) in order to eliminate this shortfall.
You acknowledge and agree that neither the Operating Partnership nor the
Company has any responsibility or will have any liability with respect to your
ability to utilize any of these special allocations of deductions or any other
tax consequences to you under the Agreement.
Except as expressly provided herein, the Agreement is otherwise reaffirmed
in all respects.
Please acknowledge your agreement to the foregoing by executing this letter
in the space provided.
Very truly yours,
PRIME RETAIL, INC.
By: C. Xxxx Xxxxxxxxx
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Name: C. Xxxx Xxxxxxxxx
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Title: E. V. P.
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PRIME RETAIL, L.P.
By: Prime Retail, Inc.
Its: General Partner
By: C. Xxxx Xxxxxxxxx
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Name: C. Xxxx Xxxxxxxxx
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Title: E. V. P.
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Acknowledged this 24th day of April, 2001.
/s/ Xxxxxxx X. Xxxxxxxxx, Xx.
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Xxxxxxx X. Xxxxxxxxx, Xx.
