EXHIBIT 10.29
EXECUTION COPY
AMENDED AND RESTATED
PARTNERSHIP AGREEMENT
among
IMC-Agrico GP Company
Agrico, Limited Partnership
and
IMC-Agrico MP, Inc.
Dated as of July 1, 1993
(as further amended and restated as of
May 26, 1995)
TABLE OF CONTENTS
Page
ARTICLE I.
Definitions 7
ARTICLE II.
Partnership, Name, Purposes, Powers, Authority to
Bind Partnership, Partnership Property,
Other and/or Competing Businesses,
Principal Place of Business; Registered Office and Agent 8
2.01 Partnership 8
2.02 Name 9
2.03 Purposes 10
2.04 Powers of the Partnership 13
2.05 Partner's Authority 13
2.06 Managing Partner; Operating Partner; Change in
Operating Partner; Authority to Bind Partnership 14
2.07 Partnership Property 16
2.08 Other and/or Competing Businesses 16
2.09 Principal Place of Business; Registered Office
and Agent 24
ARTICLE III.
Contributions to the Partnership 24
3.01 Initial Contributions 24
3.02 Additional Contributions 25
3.03 Failure to Contribute 26
3.04 Assumption of Liabilities Under Contribution
Agreement 29
3.05 Subsequent Capital Contribution 29
ARTICLE IV.
Interests of Partners 30
4.01 Interests of Partners 30
4.02 Capital Accounts 31
4.03 Interest on Capital Accounts 33
4.04 Loans from Partners 34
4.05 Transferred Capital Accounts 34
TABLE OF CONTENTS
(continued
Page
ARTICLE V.
Profit and Loss Sharing;
Allocations for Federal, State and
Local Income Tax Purposes; Cash Distributions;
Suspended Distributions; Reimbursement for Transaction Costs 35
5.01 Allocation of Profits and Losses 35
5.02 Special Allocations 35
5.03 Tax Allocations 37
5.04 Interim Closing of the Books on Transfer 39
5.05 Disagreement Between Partners 39
5.06 Obligations with Respect to Distributable Cash 40
5.07 Distribution of Distributable Cash; Suspended
Distributions 40
5.08 Payment of Transaction Costs 44
ARTICLE VI.
Management 45
6.01 Operation 45
6.02 General Powers of the Managing Partner 46
6.03 Limitations on the Partners; Relations Among
Partners 48
6.04 Policy Committee 49
6.05 Rules of Procedure 56
6.06 Further Management Limitations 56
6.07 Major Decisions 56
6.08 Management of Certain Environmental Liabilities 64
ARTICLE VII.
Encumbrance or Transfer of Partnership Interest 65
7.01 Transfer of Partnership Interest Generally 65
7.02 Transfers of Partnership Interests 66
7.03 Liens 70
7.04 Transfers Upon Triggering Events 71
7.05 Interests in Managing Partner 75
7.06 Certain Conditions of Certain Transfers 75
ARTICLE VIII.
Other Rights of, Duties and Restrictions on the Partners 76
8.01 Indemnification 76
8.02 Contribution 77
TABLE OF CONTENTS
(continued
Page
8.03 Continuing Liability of Withdrawn Partner 78
8.04 Breach of Parent Agreement 79
ARTICLE IX.
Certain Operational Provisions 79
9.01 Financial, Accounting, and Banking Matters 79
9.02 Budget and Approval Authorities 80
9.03 Insurance 82
9.04 Financial and Other Information 83
9.05 Qualifying Income 87
9.06 Work Force; Employee Benefits 89
9.07 Emergency Expenditures; Compliance with Law 93
9.08 No Action Contrary to Contracts or Applicable
Law 94
9.09 Licenses and Permits 96
9.10 Litigation 97
9.11 Payment and Reimbursement of Expenses; Handling
of Partnership Bank Accounts and Funds 97
9.12 Transactions with Affiliates 101
9.13 No Shifting of Cash Flow 103
ARTICLE X.
Accounting Records; Tax Matters 104
10.01 Books and Records 104
10.02 Inspection of Books and Records 105
10.03 Accounting and Taxable Year 106
10.04 Partnership Tax Returns 107
10.05 Partnership Taxes 107
10.06 Tax Matters Partner 108
10.07 Duties of the Tax Matters Partner 108
10.08 Partnership Status; Elections 109
10.09 Tax Reporting 110
10.10 Tax Oversight 112
ARTICLE XI.
Term 114
11.01 Term 114
11.02 Purchase Option Upon Scheduled Expiration of
the Term 114
TABLE OF CONTENTS
(continued
Page
ARTICLE XII.
Dissolution and Winding-Up 116
12.01 Dissolution 116
12.02 Winding-Up 120
12.03 Accounting on Dissolution 120
12.04 Accounting; Allocations of Residual Net Profits
and Residual Net Loss After Dissolutions 121
12.05 Application of Article V in Year of Dissolution 121
12.06 Conversion of Assets to Cash 122
12.07 Distributions in Liquidation 123
12.08 Compliance with Treasury Regulations 124
12.09 Deficit Capital Account Restoration Obligation 125
12.10 Section 708 Termination 125
12.11 Continuation of the Partnership 126
12.12 Waiver of Certain Rights 127
ARTICLE XIII.
Miscellaneous Provisions 127
13.01 Force Majeure 127
13.02 Limitation of Liability of Partners 129
13.03 Assignment 130
13.04 Notices 131
13.05 Governing Law 133
13.06 Choice of Forum 133
13.07 Consent to Jurisdiction 133
13.08 Waiver of Jury Trial 135
13.09 Entire Agreement 135
13.10 Execution in Counterparts 136
13.11 Remedies and Waiver 136
13.12 Headings 137
13.13 Third Party Beneficiaries 137
13.14 Further Assurances 137
13.15 Power of Attorney 137
13.16 Public Announcements 138
AMENDED AND RESTATED PARTNERSHIP AGREEMENT
THIS AMENDED AND RESTATED PARTNERSHIP AGREEMENT (this "Agreement")
was made as of 12:01 a.m. (CDT) on the 1st day of July, 1993 and
further amended and restated as of the 26th day of May, 1995 by and
among (i) IMC-Agrico GP Company ("IMC GPCo"), a Delaware corporation
and a subsidiary of IMC GLOBAL OPERATIONS INC. (formerly IMC
Fertilizer, Inc.), a Delaware corporation ("Operations"), (ii) Agrico,
Limited Partnership (the "FRP Partner"), a Delaware limited partnership
of which FREEPORT-McMoRan RESOURCE PARTNERS, LIMITED PARTNERSHIP, a
Delaware limited partnership ("FRP"), owns a 99.8% limited partnership
interest and Agrico, Inc., a Delaware corporation ("FRP GPCo"), owns a
0.2% general partnership interest, (iii) IMC-Agrico MP, Inc. (the
"Managing Partner"), a Delaware corporation, and (iv) Operations.
R E C I T A L S:
WHEREAS, IMC GPCo, the FRP Partner and the Managing Partner
entered into and formed a general partnership under the Act to engage
in the Phosphate Chemicals Business pursuant to a Partnership Agreement
dated as of June 29, 1993 (the "Original Agreement"); and
WHEREAS, IMC GPCo, the FRP Partner and the Managing Partner
amended and restated the Original Agreement as of July 1, 1993;
WHEREAS, the parties hereto have approved and consented to (i) (a)
the voluntary complete liquidation and dissolution of IMC GPCo, in
accordance with the General Corporation Law of the State of Delaware
("Delaware Law"), (b) the admission of Operations as a Partner in the
Partnership in accordance with the terms of this Agreement, (c) the
assumption by Operations (A) as of the date hereof, of 80% of all
obligations of IMC GPCo incurred by IMC GPCo (x) as a general partner
of the Partnership and (y) pursuant to the terms of the Partnership
Agreement, and (B) upon the completion of such liquidation and
dissolution of IMC GPCo, of all remaining obligations of IMC GPCo, (d)
the transfer to Operations of the assets, properties, rights and
interests of IMC GPCo and (e) the repurchase by IMC GPCo of the
preferred stock of IMC GPCo owned by the Managing Partner at its
liquidation value, in each case in accordance with the Agreement and
Plan of Complete Liquidation and Dissolution dated as of May 26, 1995
(the "IMC GPCo Plan of Liquidation") and (ii) (a) the liquidation of
FRP GPCo or the merger of FRP GPCo with and into Freeport Chemical
Company, a Delaware corporation ("FCC"), and the liquidation of FCC or
the merger of FCC with and into Freeport-McMoRan Inc., a Delaware
corporation ("FTX"), in each case in accordance with the FRP
GPCo/FCC/FTX Merger Documents (the "FRP GPCo/FCC/FTX Mergers"), with
the result that FTX shall become the owner of the 0.2% general
partnership interest in the FRP Partner owned by FRP GPCo immediately
prior to the FRP GPCo/FCC/FTX Mergers and shall have assumed as of the
date of the completion of such mergers all obligations of FRP GPCo and
FCC, (b) the repurchase by FRP GPCo of the preferred stock of FRP GPCo
owned by the Managing Partner at its liquidation value and (c) at the
option of FTX and FRP, the merger, liquidation or dissolution of the
FRP Partner under Delaware Law in the future (or the transfer by the
FRP Partner of its Partnership Interests to FRP or an Affiliate of FRP)
and the admission of FRP or an Affiliate of FRP as a Partner in the
Partnership, in each case in accordance with this Agreement, the
Amended and Restated Parent Agreement dated as of May 26, 1995 among
Operations, FRP, FTX and IMC-Agrico Company, a Delaware general
partnership (the "Parent Agreement"), and the Amendment, Waiver and
Consent Agreement dated as of May 26, 1995 among IMC Global Inc., a
Delaware corporation ("Global"), Operations, IMC GPCo, the Managing
Partner, IMC-Agrico Company, FTX, FRP and the FRP Partner (the
"Amendment, Waiver and Consent Agreement");
WHEREAS, the above described transactions are to be accomplished
in the following manner:
(i) with respect to the liquidation and dissolution of IMC GPCo,
80% of the interests of IMC GPCo shall be transferred to Operations
effective as of May 26, 1995 (except that 100% of IMC GPCo's 50% common
stock interest in the Managing Partner shall be transferred to
Operations as of May 26, 1995 and the preferred stock of IMC GPCo owned
by the Managing Partner shall be repurchased by IMC GPCo at its
liquidation value as of May 26, 1995 (the "Initial IMC GPCo Liquidating
Distribution"), with the remaining 20% of such interests (other than
IMC GPCo's common stock interest in the Managing Partner) to be
transferred to Operations (the "Final IMC GPCo Liquidating
Distribution") in accordance with the following time schedule and the
terms of the IMC GPCo Plan of Liquidation:
(A) if (x) FTX and FRP elect by written notice to the Partners and
the Partnership, after November 30, 1995 and on or prior to June
4, 1996, to cause the merger, liquidation or dissolution of the
FRP Partner (or the transfer by the FRP Partner of its Partnership
Interests to FRP or an Affiliate of FRP) as contemplated by the
Amendment, Waiver and Consent Agreement and (y) such merger,
liquidation or dissolution of the FRP Partner (or such transfer of
its Partnership Interests) is completed not earlier than June 5,
1996 and not later than June 15, 1996, the Final IMC GPCo
Liquidating Distribution shall be undertaken promptly after
June 22, 1997;
(B) if (x) FTX and FRP elect by written notice to the Partners
and the Partnership, after November 30, 1995 and on or prior to
June 4, 1996, to cause the merger, liquidation or dissolution of
the FRP Partner (or the transfer by the FRP Partner of its
Partnership Interests to FRP or an Affiliate of FRP) as
contemplated by the Amendment, Waiver and Consent Agreement, but
(y) such merger, liquidation or dissolution of the FRP Partner (or
such transfer of its Partnership Interests) is not completed by
June 15, 1996, the Final IMC GPCo Liquidating Distribution shall
be undertaken after June 15, 1996 and shall be completed no later
than June 30, 1996; and
(C) if FTX and FRP do not elect, after November 30, 1995 and on
or prior to June 4, 1996, to cause the merger, liquidation or
dissolution of the FRP Partner (or the transfer by the FRP Partner
of its Partnership Interests to FRP or an Affiliate of FRP) as
contemplated by the Amendment, Waiver and Consent Agreement, the
Final IMC GPCo Liquidating Distribution shall be undertaken after
June 4, 1996 and shall be completed by June 30, 1996; and
(ii) with respect to the optional merger, liquidation or
dissolution of the FRP Partner (or the transfer of its Partnership
Interests), such option may be exercised in accordance with the terms
of this Agreement and the Amendment Waiver and Consent Agreement at any
time after November 30, 1995 and on or prior to June 4, 1996; provided
that if FTX and FRP exercise such option on or prior to June 4, 1996,
their right to cause such merger, liquidation or dissolution of the FRP
Partner (or such transfer of its Partnership Interests) at that time
will be forfeited unless such merger, liquidation or dissolution of the
FRP Partner (or such transfer of its Partnership Interests) is
completed not earlier than June 5, 1996 and not later than June 15,
1996; provided, further, that if after November 30, 1995 and on or
prior to June 4, 1996 FTX and FRP exercise such option, but such
merger, liquidation or dissolution of the FRP Partner (or such transfer
of its Partnership Interests) is not completed on or prior to June 15,
1996, FTX and FRP will have an additional option to cause such merger,
liquidation or dissolution of the FRP Partner (or such transfer of its
Partnership Interests) at any time after July 15, 1997; and provided,
further, that if after November 30, 1995 and on or prior to June 4,
1996, FTX and FRP do not exercise their option to cause such merger,
liquidation or dissolution of the FRP Partner (or such transfer of its
Partnership Interests), FTX and FRP will have the right to exercise
such option at any time after July 15, 1997;
provided, however that, notwithstanding the provisions of this
paragraph (ii), FTX and FRP may merge, liquidate or dissolve the FRP
Partner (or transfer its Partnership Interests to FRP or an Affiliate
of FRP) in accordance with the terms of the Amendment, Waiver and
Consent Agreement at any time so long as FTX and FRP bear, and assume
liability for, any expense, cost or loss (including any increase in
taxes, other than any increase in income taxes which arises solely from
the timing of the reporting of income, deductions and credits
attributable to the normal business activities of the Partnership)
suffered by the Partnership, any other Partner or any of their Related
Persons (as defined below) resulting therefrom;
WHEREAS, the IMC GPCo Liquidation, the FRP GPCo/FCC/FTX Mergers
and such optional merger, liquidation or dissolution of the FRP Partner
(or such transfer of its Partnership Interests) make it necessary and
desirable to amend and restate certain provisions of the Partnership
Agreement as originally entered into, and as previously amended and
restated, by the parties in order to, among other things, admit
Operations as a new Partner; and
WHEREAS, the Partners (as hereinafter defined) believe that
through the combination of the Contributed Businesses of IMC and FRP as
contemplated by the Contribution Agreement and the management of the
business and affairs of the Partnership in accordance with the terms
hereof, they can create certain synergies.
NOW, THEREFORE, in consideration of the representations,
warranties, covenants and agreements herein set forth and of other good
and valuable consideration, receipt of which is hereby acknowledged,
the parties hereto agree as follows:
ARTICLE I.
Definitions
Capitalized terms used in this Agreement which are not otherwise
defined herein shall have the meanings given to such terms in Exhibit A
hereto. During the period subsequent to the Initial IMC GPCo
Liquidating Distribution and prior to the Final IMC GPCo Liquidating
Distribution (the "IMC GPCo Liquidation Period"), the term "IMC
Partner" (and correlative terms, such as "Non-Managing Partner",
relating to the "IMC Partner") as used herein, shall refer to IMC GPCo
and Operations, collectively and, unless otherwise provided herein,
actions to be taken by the IMC Partner during the IMC GPCo Liquidation
Period shall be taken by Operations and IMC GPCo acting jointly;
subsequent to the Final IMC GPCo Liquidating Distribution, the term
"IMC Partner" (and such correlative terms) as used herein shall refer
to Operations, and Operations shall take any such actions acting alone;
and at all such times, the term "IMC Partner" (and such correlative
terms) as used herein shall refer to any other Affiliate of Operations
which succeeds to the Partnership Interests of IMC GPCo or Operations
by means of the purchase, transfer, assignment or other conveyance or
succession of such Partnership Interests in accordance with the terms
of this Agreement. The IMC Partner, as so defined, the FRP Partner and
the Managing Partner are sometimes hereinafter referred to individually
as a "Partner" and collectively as the "Partners."
ARTICLE II.
Partnership, Name, Purposes, Powers, Authority to
Bind Partnership, Partnership Property,
Other and/or Competing Businesses.
2.01 Partnership. The Partners have hereby formed a general
partnership under the Act on the terms and for the purposes set forth
in this Agreement and, pursuant to this Amended and Restated
Partnership Agreement, as further amended and restated as of May 26,
1995, IMC GPCo, the FRP Partner and the Managing Partner, as Partners,
hereby agree: (i) in accordance with the terms of Section 13.09
herein, to admit Operations as a Partner of the Partnership, upon the
completion of the Initial IMC GPCo Liquidating Distribution; (ii) upon
the completion of the Final IMC GPCo Liquidating Distribution, to the
withdrawal of IMC GPCo as a Partner in the Partnership, without, in
accordance with Section 12.11 herein, such withdrawal constituting a
Dissolution Event, unless such dissolution is required by applicable
law; (iii) if FTX and FRP choose to cause the merger, liquidation or
dissolution of the FRP Partner (or the transfer by the FRP Partner of
its Partnership Interests to FRP or an Affiliate of FRP) and in
accordance with the terms of the Amendment, Waiver and Consent
Agreement, upon the completion of such merger, liquidation or
dissolution (or such transfer of the Partnership Interests), to admit
FRP or an Affiliate of FRP as a Partner of the Partnership in
accordance with the terms of Section 13.09 herein and to the withdrawal
of the FRP Partner as a Partner in the Partnership, without, in
accordance with Section 12.11 herein, such withdrawal constituting a
Dissolution Event, unless such dissolution is required by applicable
law.
2.02 Name. The Partnership is to be known as "IMC-Agrico
Company" or such other name as the Partners shall unanimously select.
The Partners shall execute and file and/or publish all assumed name
statements and certificates required by law to be filed and/or
published in connection with the operation of the Partnership.
2.03 Purposes. The purposes of the Partnership shall be to
engage for profit in the Phosphate Chemicals Business and to engage for
profit in any and all other activities reasonably related to or
incidental to the Phosphate Chemicals Business, and, subject to Section
9.05, to engage for profit in any other business, whether or not
related or incidental thereto, as determined by the Policy Committee
from time to time. Without limiting the generality of the foregoing,
the Partnership may, among other things:
(a) acquire, develop, construct, own, manage and operate
phosphate rock mining operations and production facilities,
phosphate chemical facilities, ammonia and urea fertilizer
facilities and uranium oxide facilities;
(b) acquire, by purchase, lease, sublease, license,
royalty agreement or otherwise, land and phosphate mineral rights
to the extent related to the Phosphate Chemicals Business;
(c) develop mines and conduct mining operations in and on
phosphate rock reserves and deposits, and construct, own, manage
and operate phosphate rock, chemical, ammonia, urea and uranium
extraction plants related thereto;
(d) acquire by purchase, lease, sublease, license or
otherwise, such machinery, equipment, vehicles and other
facilities as may be necessary or advisable to own, manage,
operate or otherwise engage for profit in the Phosphate Chemicals
Business or any other business of the Partnership at the time
permitted hereunder;
(e) subject to Section 9.12, enter into such construction,
engineering, operating, management, mining, marketing, selling,
supply or distributorship agreements, arrangements or
understandings with third parties as may be necessary or advisable
to own, manage, operate or otherwise engage for profit in the
Phosphate Chemicals Business or any other business of the
Partnership at the time permitted hereunder (and such agreements,
arrangements or understandings may be (i) with Affiliates of any
Partner so long as they comply with the terms of Section 9.12 and
(ii) with or through trade associations, including, without
limitation, the Phosphate Chemicals Export Association, a Xxxx-
Xxxxxxxx Act organization ("PhosChem"), and the Phosphate Rock
Export Association, a Xxxx-Xxxxxxxx Act organization
("PhosRock"));
(f) own, lease, rent and/or operate and/or make use of
railcars, railway lines and dock loading facilities and vessels
and otherwise arrange for the transportation of the Partnership's
inventory, supplies, materials, equipment, phosphate rock,
phosphate chemicals, uranium oxide, ammonia, urea and uranium
products and any other products produced from, or used in, the
operation of the Phosphate Chemicals Business by such means as may
be necessary or advisable;
(g) sell (in domestic or foreign markets) such phosphate
rock, phosphate chemicals, uranium oxide, ammonia, urea and
uranium products and related products and engage in marketing
activities incidental thereto (either directly or through third
parties, including, without limitation, trade associations, such
as PhosChem and PhosRock);
(h) form, organize, join and participate in trade
associations related to the Phosphate Chemicals Business,
including, without limitation, PhosChem and PhosRock;
(i) manage and operate agricultural, farming and livestock
businesses as an incidental activity relating to holding lands
originally acquired or leased by the Partnership or one of the
Partners' Affiliates as phosphate rock reserves;
(j) subject to Section 9.12, perform all other activities,
including the borrowing of money and the mortgaging of real or
personal property of the Partnership in connection therewith, as
are necessary or incidental to the business or operations of the
Partnership; and
(k) subject to Sections 9.05 and 9.12, engage in such
other businesses and activities, whether or not related to or
incidental to the Phosphate Chemicals Business, as determined by
the Policy Committee from time to time.
2.04 Powers of the Partnership. Subject to the restrictions set
forth in this Agreement, the Partnership shall have the power to
exercise all the powers and privileges granted by this Agreement and by
law, together with any powers incidental thereto, so far as such powers
and privileges are necessary or appropriate for the conduct, promotion
or attainment of the purposes of the Partnership. Except as otherwise
expressly provided in this Agreement, the rights and obligations of the
Partners and the administration and termination of the Partnership
shall be governed by the Act.
2.05 Partner's Authority. Except as otherwise provided in this
Agreement, no Partner shall have any authority to act for, or to assume
any obligations or responsibilities on behalf of, any other Partner or
the Partnership.
2.06 Managing Partner; Operating Partner; Change in Operating
Partner; Authority to Bind Partnership.
(a) IMC-Agrico MP, Inc. is hereby designated as the
managing partner of the Partnership (the "Managing Partner"). The
Managing Partner shall, subject to the provisions of this
Agreement, have exclusive authority and responsibility to manage
the business and affairs of the Partnership and to make all
decisions regarding the business and affairs of the Partnership.
The Managing Partner is a special purpose corporation formed
solely for the purpose of acting as Managing Partner of the
Partnership. Accordingly, the Managing Partner shall not, without
the consent of both the IMC Partner and the FRP Partner, engage in
any business other than acting as the Managing Partner hereunder.
(b) As used herein, the term "Operating Partner" shall
mean the Non-Managing Partner, initially the IMC Partner (which,
for purposes of identifying the Operating Partner, shall mean
Operations), which is entitled to elect a majority of the
directors of the Managing Partner at any given time and "Non-
Operating Partner" shall mean the other Non-Managing Partner at
that time. If a Material Breach Event shall have occurred and not
been cured prior to the delivery of the notice of exercise
described below, then (if none of the Non-Operating Partner or any
of its direct or indirect parent entities is Bankrupt) the Non-
Operating Partner shall have the right, upon written notice of the
exercise of such right, to become the Operating Partner and, if
such written notice is delivered exercising that right, the
Operating Partner shall become the Non-Operating Partner. In the
event of a Material Breach Event arising out of a Bankruptcy of
the Operating Partner or any of its direct or indirect parent
entities, prior to exercising its right to become the Operating
Partner, the Non-Operating Partner will reasonably evaluate the
circumstances surrounding such Bankruptcy, giving consideration to
the effect of the Bankruptcy on the Partnership and on the
Managing Partner and its ability to perform its obligations as
Managing Partner, but will have the right in its sole discretion
to elect to become the Operating Partner in accordance with the
terms of this Section 2.06(b). The terms of this Section 2.06(b)
shall similarly apply to any subsequent Material Breach Event or
Events.
(c) As between the Partnership and any other Person (other
than a Partner or its Affiliates), any action taken by the
Managing Partner on behalf of the Partnership shall constitute the
act of and serve to bind the Partnership. In dealing with the
Managing Partner acting on behalf of the Partnership, no Person
(other than the Non-Managing Partners and their respective
Affiliates) shall be required to inquire into the authority of the
Managing Partner to bind the Partnership. Without in any way
limiting the rights of the Partners hereunder as between each
other, Persons dealing with the Managing Partner are entitled to
rely conclusively upon the power and authority of the Managing
Partner as set forth in this Section 2.06.
2.07 Partnership Property. All real and personal property,
whether tangible or intangible (including, without limitation, all
permits and licenses), owned by or granted to or held by the
Partnership shall be deemed to be owned by or granted to or held by the
Partnership as an entity, and no Partner, individually, shall have any
ownership or right to use any such property.
2.08 Other and/or Competing Businesses.
(a) Except as otherwise provided herein, nothing contained
in this Agreement shall be deemed to restrict in any way the
freedom of any Partner or of any Affiliate of any Partner to
conduct, independently of the Partnership, any business or
activity whatsoever without any accountability to the Partnership
or to the other Partners.
(b) Except as set forth in this Section 2.08(b) and in
Section 2.0 of the Parent Agreement, each Partner agrees that
neither it nor any of its Affiliates will, directly or indirectly,
anywhere in the world, own, manage, operate, control or invest in
any business that is engaged in the Phosphate Chemicals Business
without first complying with the provisions of this Section
2.08(b), it being understood that (i) purchases and resales of
phosphate chemicals in Canada by Affiliates of the IMC Partner in
volumes not materially greater than the amounts indicated on
Schedule 9.12 hereof and (ii) the conduct of the business of the
Rainbow Division of Operations substantially as currently
conducted, shall not constitute a breach or violation of this
Section 2.08. Notwithstanding the foregoing, any Person that
acquires or succeeds to (or whose Affiliate acquires or succeeds
to) the Partnership Interest (or any portion thereof) of any
Partner shall not be subject to the provisions of this Section
2.08(b) with respect to any business conducted by such Person or
its Affiliates that is conducted thereafter substantially as
conducted on the date of such acquisition or succession. If any
Affiliate of either Non-Managing Partner desires to accept an
opportunity to own, manage, operate, control or invest in any
business that is engaged, in whole or in part, in the Phosphate
Chemicals Business, the Non-Managing Partner affiliated with such
Person (the "Presenting Partner") will first offer such
opportunity to the Partnership, it being understood that two (2)
Policy Committee Representatives or Alternates (or any combination
thereof) of the Non-Managing Partner other than the Presenting
Partner (the "Exercising Partner") may elect, on behalf of the
Partnership, to pursue such opportunity within thirty (30) days
following the presentation of such opportunity to the Partnership.
The Representatives or Alternates (or any combination thereof) of
the Exercising Partner shall notify the Presenting Partner in
writing of such election, on behalf of the Partnership, to pursue
or not to pursue such opportunity before the expiration of such
thirty (30) day period. If the Exercising Partner fails to give
the Presenting Partner notice of such election within such thirty
(30) day period, the Exercising Partner shall be deemed to have
elected, on behalf of the Partnership, not to pursue such
opportunity. If the Partnership so elects to pursue such
opportunity, the Partnership shall reimburse the Presenting
Partner or its Affiliates in an amount equal to the direct costs
incurred by the Presenting Partner or its Affiliates in connection
with developing such opportunity prior to the date of the
Partnership's election to pursue such opportunity and the
opportunity will be considered a Capital Project. If the
Partnership does not so elect (or is so deemed not to have
elected) to pursue such opportunity or, if at any time the
Partnership ceases to pursue the opportunity in good faith, one or
more Affiliates of the Presenting Partner may then elect to pursue
such opportunity. If FRP desires to expand its existing
operations (or pursue other business opportunities which are part
of or related to the Phosphate Chemicals Business) in Sri Lanka or
to pursue the opportunities described in a memorandum of
understanding between FTX and Ercros, S.A. relating to FESA and
ENFERSA, it shall first offer such opportunities to the
Partnership in accordance with the preceding provisions of this
Section 2.08(b); provided that if the Partnership elects to pursue
any of such opportunities, the Partnership shall reimburse FRP in
an amount equal to the direct costs incurred by FRP in connection
with developing such opportunity prior to the date of the
Partnership's election to pursue such opportunity.
Notwithstanding the foregoing, nothing contained in this Section
2.08(b) shall prevent one or more Affiliates of any Partner from
(A) owning, directly or indirectly, an aggregate of less than five
percent (5%) of the common stock of, or other ownership interest
in, any Person engaged in the Phosphate Chemicals Business or (B)
acquiring (by stock purchase, asset purchase, merger,
consolidation or otherwise) any Person engaged in the Phosphate
Chemicals Business so long as (I) the revenues derived by such
Person from its Phosphate Chemicals Business represent (and can
reasonably be expected to continue to represent) less than ten
percent (10%) of the total revenues of such Person and (II) the
Person acquiring such Person (the "Acquiring Person") either
offers to sell such Person's Phosphate Chemicals Business to the
Partnership at its fair market value or sells such Person's
Phosphate Chemicals Business to an independent third Person, it
being understood that, in the case of this clause (B), the
Acquiring Person may continue to own and operate, directly or
indirectly, such acquired Person's Phosphate Chemicals Business if
it has offered to sell such Phosphate Chemicals Business to the
Partnership in accordance with this sentence and (x) if any
Affiliate of the FRP Partner is the Acquiring Person, two (2)
Policy Committee Representatives or Alternates of the IMC Partner
(or any combination thereof) fail, on behalf of the Partnership,
to accept such offer within thirty (30) days of such offer to
sell, or (y) if any Affiliate of the IMC Partner is the Acquiring
Person, two (2) Policy Committee Representatives or Alternates of
the FRP Partner (or any combination thereof) fail, on behalf of
the Partnership to accept such offer within thirty (30) days of
such offer to sell. Each Partner acknowledges and agrees that the
covenants contained in this Section 2.08(b) have been negotiated
in good faith by the parties hereto, and are reasonable and are
not more restrictive or broader than necessary to protect the
interests of the Partners hereto, and would not achieve their
intended purpose if they were on different terms or for periods of
time shorter than the periods of time provided herein or were
applied in more restrictive geographical areas than are provided
herein. Each Partner further acknowledges and agrees that the
business of the Partnership is highly competitive, that no Partner
hereto would enter into this Agreement but for the covenants
contained in this Section 2.08(b) and that such covenants are
essential to protect the value of the business of the Partnership.
If any provision of this Section 2.08(b) is held to be
unenforceable because of the scope or area of its applicability,
the court making such determination shall have the power to modify
such scope and area or either of them, and such provision shall
then be applicable in such modified form. Each Partner and its
Affiliates shall be relieved of all obligations under this Section
2.08(b) on and after the second anniversary of the date that such
Partner and its Affiliates cease to own an interest in the
Partnership.
(c) If either Non-Managing Partner (the "Developing
Partner") desires to pursue, or to cause the Partnership to
pursue, a Real Estate Development Project, it shall present such
Real Estate Development Project to the Partnership, it being
understood that two (2) Representatives or Alternates (or any
combination thereof) of the Non-Managing Partner other than the
Developing Partner (the "Electing Partner") may elect, on behalf
of the Partnership, to pursue such Real Estate Development Project
within sixty (60) days following the completion of such
presentation. The Electing Partner shall notify the Developing
Partner in writing of such election, on behalf of the Partnership,
to pursue or not to pursue such Real Estate Development Project
before the expiration of such sixty (60) day period. If the
Electing Partner fails to give the Developing Partner notice of
such election within such sixty (60) day period, the Electing
Partner shall be deemed to have elected, on behalf of the
Partnership, not to pursue such Real Estate Development Project.
If the Partnership so elects to pursue such Real Estate
Development Project, the Electing Partner shall promptly reimburse
the Developing Partner for an aggregate of seventy-five percent
(75%) of the direct costs incurred by the Developing Partner or
its Affiliates in connection with developing such Real Estate
Development Project prior to the date of such election. If the
Partnership does not so elect (or is so deemed not to have
elected) to pursue such Real Estate Development Project, then the
Developing Partner shall have the option, for a period of sixty
(60) days, to deliver a written notice to each other Partner of
its election to either (i) purchase the real property which is to
be the subject of the Real Estate Development Project from the
Partnership at its fair market value or (ii) cause the Partnership
to make a distribution in kind to the Developing Partner of the
real property which will be the subject of the Real Estate
Development Project. If the Developing Partner elects the
purchase option set forth in clause (i) of the preceding sentence,
then (A) the Partners shall negotiate in good faith to determine
the fair market value of such real property (and if they cannot
agree on such value within sixty (60) days following the notice
referred to in the preceding sentence, the fair market value shall
be determined in accordance with the Real Estate Appraisal
Procedure, the cost of which shall be paid by the Developing
Partner) and (B) the Partnership shall, within thirty (30) days of
the date such fair market value is finally determined, sell such
real property to the Developing Partner for a purchase price,
payable at the closing of such sale in immediately available
funds, equal to its fair market value. If the Developing Partner
elects to cause the Partnership to make a distribution in kind
pursuant to clause (ii) of the second preceding sentence the
Partnership shall make, on or before the thirtieth (30th) day
following the date of such election, (1) a distribution in kind to
the Developing Partner, of the real property which is the subject
of the Real Estate Development Project, (2) a distribution in kind
to the Electing Partner of a Comparable Property and (3) a
proportional distribution in cash to the Managing Partner. For
purposes of this Section 2.08(c), "Comparable Property" shall mean
similarly situated real property as determined by the Managing
Partner, reasonably acceptable to the Policy Committee, having a
fair market value such that the ratio of the fair market value of
such real property compared to the fair market value of the real
property being distributed to the Developing Partner is equal to
the ratio of (x) the Capital Interest of the Partner receiving the
distribution in kind pursuant to clause (2) of the preceding
sentence to (y) the Capital Interest of the Developing Partner, in
each case at the time of such distribution. Each Partner and its
Affiliates shall be relieved of all obligations under this Section
2.09(c) on and after the date that such Partner and its Affiliates
cease to own an interest in the Partnership.
2.09 Principal Place of Business; Registered Office and Agent.
The principal place of business of the Partnership shall be located at
0000 Xxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx 00000 or at such other place or
places as the Policy Committee may from time to time determine. The
registered office of the Partnership shall be 0000 Xxxxxxx Xxxx,
Xxxxxxxxxx, Xxxxxxxx 00000 and the registered agent of the Partnership
at such address shall be the Managing Partner; provided that the
Managing Partner may designate such other address or agent as it
determines appropriate from time to time.
ARTICLE III.
Contributions to the Partnership
3.01 Initial Contributions. On the Closing Date, the
contributions are being made to the Partnership by or on behalf of, and
the Partnership will assume certain liabilities of, the Partners and
their Affiliates, all as provided in the Contribution Agreement.
Immediately after such contribution, the agreed value of each Partner's
Capital Account shall be as follows (it being understood that such
agreed values shall not reflect, and shall not be adjusted to reflect,
any adjustments or payments contemplated by the Contribution
Agreement):
IMC Partner $748,993,000
FRP Partner $650,993,000
Managing Partner $
14,000
3.02 Additional Contributions. As and when the Policy Committee
(or, if not the Policy Committee, the CEOs but not the Managing
Partner) determines, in accordance with the terms of Section 6.07(a) or
(b), that the Partnership requires cash from time to time, each of the
IMC Partner (or, during the IMC GPCo Liquidation Period, each of
Operations and IMC GPCo) and the FRP Partner hereby agrees that it
shall make cash contributions to the Partnership in an amount equal to
the product of (i) the amount of the Partnership's cash requirement as
determined by the Policy Committee or the CEOs, but not the Managing
Partner, in accordance with the terms of Section 6.07(a) or (b), by the
Policy Committee (or, if not by the Policy Committee, by the CEOs),
multiplied by (ii) a fraction, the numerator of which is such Partner's
Current Interest and the denominator of which is the aggregate Current
Interests of the Non-Managing Partners; provided that if the Policy
Committee (or, if not the Policy Committee, the CEOs) determines, in
accordance with the terms of Section 6.07(a) or (b), that the cash
required by the Partnership is to be used for a Capital Project, each
of the IMC Partner (or, during the IMC GPCo Liquidation Period, each of
Operations and IMC GPCo) and the FRP Partner shall make cash
contributions to the Partnership either (x) in an amount equal to the
product of (1) the cash required by the Partnership for such Capital
Project as determined, in accordance with the terms of Section 6.07(a)
or (b), by the Policy Committee (or, if not by the Policy Committee, by
the CEOs), multiplied by (2) a fraction, the numerator of which is the
Capital Interest of such Partner at such time as the Capital Project
will be placed in service and the denominator of which is the aggregate
Capital Interests of the Non-Managing Partners at such time as the
Capital Project will be placed in service, or (y) in such other amount
as the Policy Committee (or, if not the Policy Committee, the CEOs) may
determine in accordance with the terms of Section 6.07(a) or (b). Once
the Policy Committee (or, if not the Policy Committee, the CEOs)
approves, in accordance with the terms of Section 6.07(a) or (b), an
additional cash contribution, the Managing Partner shall have, subject
to any terms or conditions specified by the Policy Committee (or, if
not by the Policy Committee, by the CEOs) at the time it so approves
such additional cash contribution, the reasonable discretion to
determine the timing of such cash contribution giving due consideration
to the Partnership's cash needs as determined by the Managing Partner.
The Managing Partner shall notify the IMC Partner (or, during the IMC
GPCo Liquidation Period, each of Operations and IMC GPCo) and the FRP
Partner at least ten (10) days in advance of the time each such cash
contribution is required to be made to the Partnership.
3.03 Failure to Contribute. If either the IMC Partner (or,
during the IMC GPCo Liquidation Period, either of Operations or IMC
GPCo) or the FRP Partner (in any such case, the "Non-Contributing
Partner") fails, in whole or in part, to make any cash contribution or
defaults, in whole or in part, in any other obligation to pay money
under this Agreement within fifteen (15) days of giving of a due notice
by either of the other Partners to the Non-Contributing Partner that
such cash contribution is due or that the Non-Contributing Partner has
defaulted in any other such obligation hereunder, the IMC Partner (with
respect to circumstances in which the FRP Partner is the Non-
Contributing Partner) or the FRP Partner (with respect to circumstances
in which the IMC Partner (or, during the IMC GPCo Liquidation Period,
either of Operations or IMC GPCo) is the Non-Contributing Partner), as
the case may be (in either such case, the "Contributing Partner"),
shall have the right to advance directly to the Partnership such
additional cash contribution, or portion thereof, or such other payment
of money, or portion thereof, as the Non-Contributing Partner has
failed to make or defaulted on (the "Non-Contributing Partner's
Share"), and such advance, together with a proportionate amount of the
corresponding cash contribution or other payment, if any, made by such
Contributing Partner, shall be deemed a loan by the Contributing
Partner to the Partnership (the "Partner Loan"). A Partner Loan shall
bear interest at the rate equal to the lower of: (i) the maximum rate
allowed by law; or (ii) five (5) percentage points over the Prime Rate.
The Partner Loan shall be recouped and otherwise repaid from all funds
which would otherwise have been available to make distributions which
the Partners would otherwise be entitled to receive from the
Partnership but for this Section 3.03, all of which shall instead be
paid by the Partnership to the Contributing Partner and applied to the
payment of the Partner Loan and all interest thereon, until the same
shall have been paid in full. It is understood, however, that to the
extent the principal and interest of a Partner Loan are not repaid in
full by the Partnership from all funds which would otherwise have been
available to make distributions (including any distributions pursuant
to Section 12.07(b)) to the Partners, the Non-Contributing Partner
shall be obligated to repay an amount equal to the Non-Contributing
Partner's Share of the outstanding balance of the principal and
interest of such Partner Loan upon commencement of the winding up of
the Partnership in accordance with Section 12.02. Any amount which
would otherwise have been available to make distributions from the
Partnership that is applied to any Partner Loan shall be credited first
to any interest then due on such Partner Loan, and the balance of the
distribution shall be credited against the outstanding principal
balance of such Partner Loan.
The exercise of the right to make a Partner Loan shall be in
addition to any other rights or remedies that the Contributing Partner
may have under this Agreement or at law or in equity arising from the
Non-Contributing Partner's (i) failure to make the required cash
contribution or (ii) default in any other obligation to pay money.
3.04 Assumption of Liabilities Under Contribution Agreement. In
accordance with the terms of this Agreement, the IMC Partner has
assumed all of the liabilities and obligations of Operations, and the
FRP Partner has assumed all of the liabilities and obligations of FRP,
in each case under and pursuant to the Contribution Agreement and each
such Partner hereby confirms its agreement to perform such assumed
liabilities and obligations as if it were a party to such agreement.
Any amounts payable by either Non-Managing Partner under the
Contribution Agreement shall be deemed amounts payable by such Non-
Managing Partner hereunder. The Partners agree that (i) any payment by
the IMC Partner or the FRP Partner pursuant to the terms of this
Section 3.04 shall satisfy such amounts payable by Operations or FRP,
as the case may be, or their Affiliates under the Contribution
Agreement and (ii) any payment by Operations or FRP, as the case may
be, or their Affiliates under the Contribution Agreement shall satisfy
such amounts payable by the IMC Partner or the FRP Partner under this
Section 3.04. Nothing herein shall be deemed to release Operations or
FRP (or any of their Affiliates) from any obligations they may have
under the Contribution Agreement.
3.05 Subsequent Capital Contribution. The IMC Partner and the
FRP Partner each may, after the Closing Date, contribute to the
Partnership their respective organizational costs, as defined in
Section 709 of the Code, incurred in forming the Partnership.
ARTICLE IV.
Interests of Partners
4.01 Interests of Partners.
(a) The "Current Interests" of the Partners shall be as
follows:
Fiscal Year Ending IMC FRP Managing
June 30 Partner Partner Partner
1994 41.3995% 58.5995% 0.001%
1995 44.9995% 54.9995% 0.001%
1996 46.8995% 53.0995% 0.001%
1997 46.4995% 53.4995% 0.001%
1998 and 59.3995% 40.5995% 0.001%
thereafter
During the IMC GPCo Liquidation Period, the "Current Interests" of
Operations and IMC GPCo shall be equal to eighty percent (80%) and
twenty percent (20%), respectively, of the "Current Interests" of the
IMC Partner set forth above.
(b) The "Capital Interests" of the Partners shall be as
follows:
Fiscal Year Ending IMC FRP Managing
June 30 Partner Partner Partner
1994 53.4995% 46.4995% 0.001%
1995 54.8995% 45.0995% 0.001%
1996 56.3995% 43.5995% 0.001%
1997 57.7995% 42.1995% 0.001%
1998 and 59.3995% 40.5995% 0.001%
thereafter
During the IMC GPCo Liquidation Period, the "Capital Interests" of
Operations and IMC GPCo shall be equal to eighty percent (80%) and
twenty percent (20%), respectively, of the "Capital Interests" of the
IMC Partner set forth above.
4.02 Capital Accounts.
(a) A separate Capital Account shall be established and
maintained in respect of each Partner.
(b) The Capital Accounts of the Partners shall be credited
with (i) the amount of cash and the fair market value of other
property (net of liabilities that the Partnership is considered to
assume or take subject to under Section 752 of the Code)
contributed by such Partner to the capital of the Partnership and
(ii) allocations to such Partner pursuant to Sections 5.01 and
5.02 of income (or items thereof) including tax-exempt income and
gain. The Capital Accounts of each of the Partners shall be
debited with (i) the amount of cash and the fair market value of
other property distributed to such Partner (net of liabilities
that such Partner is considered to assume or take subject to under
Section 752 of the Code); (ii) allocations to such Partner of
expenditures of the Partnership described in Section 705(a)(2)(B)
of the Code; and (iii) allocations to such Partner pursuant to
Sections 5.01 and 5.02 of deduction or loss (or items thereof).
If any property other than cash is distributed to any Partner, the
Capital Accounts of the Partners shall be adjusted as if the
property had instead been sold by the Partnership for a price
equal to its fair market value, with the resulting gain or loss
allocated among the Partners pursuant to Sections 5.01 and 5.02
and the proceeds thereof distributed.
(c) For purposes of computing the amount of any item of
income, gain, deduction or loss to be reflected in the Capital
Accounts of the Partners, the determination, recognition and
classification of such items shall be the same as its
determination, recognition and classification for Federal income
tax purposes; except that:
(i) Any deductions for depreciation, depletion, cost
recovery or amortization attributable to property
contributed by the Partners to the Partnership or
attributable to Partnership property adjusted pursuant to
Section 4.02(d) shall be determined as if the adjusted
basis of such property on the date it was contributed or
adjusted was equal to the fair market value of the
property; and
(ii) Any income, gain or loss attributable to the
taxable disposition of any property contributed by the
Partners or attributable to Partnership property adjusted
pursuant to Section 4.02(d) shall be determined as if the
adjusted basis of the property as of the date of
disposition was equal to the fair market value of the
property at the time of contribution or adjustment reduced
by all depreciation, cost recovery and amortization
deductions charged to the Partners' Capital Accounts with
respect to such property.
(d) Upon the issuance of additional Partnership interests
for cash or property, the Capital Accounts of the Partners and the
value of all Partnership assets for purposes of Section 4.02(c)
shall be adjusted upwards or downwards to reflect any unrealized
gain or unrealized loss attributable to each asset as if such
assets had been sold immediately prior to such issuance and such
gain or loss had been allocated to the Partners, at such time,
pursuant to Sections 5.01 and 5.02.
4.03 Interest on Capital Accounts. Except as specifically
provided herein, no Partner shall be entitled to any interest on its
Capital Account or its contributions to the capital of the Partnership,
nor shall any Partner have the right to demand or receive the return of
all or any part of its Capital Account or its contributions to the
capital of the Partnership.
4.04 Loans from Partners. Loans by a Partner to the Partnership
(including, without limitation, any Partner Loan) shall not be
considered capital contributions.
4.05 Transferred Capital Accounts. In the event that any Partner
transfers all or a portion of its Partnership Interest in accordance
with the terms of this Agreement, the transferee shall succeed to the
Capital Account of the transferor Partner to the extent such Capital
Account relates to the transferred Partnership Interest or portion
thereof. In accordance with the terms of the preceding sentence,
Operations shall succeed to 80% of the Capital Account of IMC GPCo as
of the date of the Initial IMC GPCo Liquidating Distribution and
Operations shall succeed to the remaining 20% of the Capital Account of
IMC GPCo as of the date of the Final IMC GPCo Liquidating Distribution.
If FTX and FRP elect to merge, liquidate or dissolve the FRP Partner
(or transfer its Partnership Interests) in accordance with the terms of
the Amendment, Waiver and Consent Agreement, the successor to the FRP
Partner, as a Partner to the Partnership, shall succeed to the Capital
Account of the FRP Partner, as provided in the first sentence of this
Section.
ARTICLE V.
Profit and Loss Sharing;
Allocations for Federal, State and
Local Income Tax Purposes; Cash Distributions;
Suspended Distributions; Reimbursement for Transaction Costs
5.01 Allocation of Profits and Losses. Except as provided in
Section 5.02, 5.03 or 12.05, for purposes of maintaining the Capital
Accounts and in determining the rights of the Partners among
themselves, each item of income, gain, loss and deduction (computed in
accordance with Section 4.02(c)) shall be allocated to the Partners'
Capital Accounts as a part of the Residual Net Profit or Residual Net
Loss for the year in accordance with the Partners' Capital Interests
for the following year.
5.02 Special Allocations.
(a) Transaction Costs attributable to the transactions
contemplated by the Contribution Agreement shall be allocated
fifty percent (50%) to IMC GPCo and fifty percent (50%) to the FRP
Partner.
(b) Any gain or loss attributable to a Capital Transaction
shall be allocated to the IMC Partner (or, during the IMC GPCo
Liquidation Period, Operations and IMC GPCo) and the FRP Partner
in accordance with their respective Capital Interests for the
fiscal quarter of the Partnership in which the effective date of
the Capital Transaction occurs.
(c) If the IMC Partner's (or, during the IMC GPCo
Liquidation Period, Operations' and IMC GPCo's) or the FRP
Partner's share of Current Interest Cash for any year exceeds that
Partner's share of Target Cash for that year, such Partner shall
be allocated an amount of gross income equal to the excess.
(d) If the IMC Partner's (or, during the IMC GPCo
Liquidation Period, Operations' and IMC GPCo's) or the FRP
Partner's share of Current Interest Cash for any year is less than
that Partner's share of Target Cash for that year, such Partner
shall be allocated an amount of gross loss equal to the
difference.
(e) The gross income or loss allocated to any Partner
under Section 5.02(c) or 5.02(d) shall be considered to consist of
each item of Partnership income or loss (except depreciation,
depletion and amortization), as the case may be, in the same
proportion that such items bear to total Partnership income or
loss.
(f) For purposes of Sections 5.02(c) and 5.02(d), the IMC
Partner's (or, during the IMC GPCo Liquidation Period, Operations'
and IMC GPCo's) or the FRP Partner's percentage of Target Cash for
any year shall be equal to such Partner's Current Interest for
such year. For purposes of Sections 5.02(c) and 5.02(d), the IMC
Partner's (or, during the IMC GPCo Liquidation Period, Operations'
and IMC GPCo's) or the FRP Partner's "share of Target Cash" for
any year shall be equal to (i) such Partner's percentage of Target
Cash for such year, as determined pursuant to the preceding
sentence multiplied by (ii) Target Cash for such year.
(g) All losses and deductions associated with the
Partners' organizational costs shall be allocated proportionally
to the Partners based on their contribution of such costs pursuant
to Section 3.05.
5.03 Tax Allocations.
(a) Except as otherwise provided in this Agreement, for
Federal income tax purposes, all items of Partnership income,
gain, loss and deduction (and the character and source of such
items) shall be allocated among the Partners in the same manner as
the corresponding item of income, gain, loss or deduction is
allocated to Capital Accounts pursuant to Sections 5.01 and 5.02.
(b) If, as a result of contributions of property by a
Partner to the Partnership or as a result of the revaluation of
Partnership assets pursuant to Section 4.02(d), Section 704(c) of
the Code (or the principles of Section 704(c) of the Code)
requires allocations of income, gain, loss and deduction of the
Partnership in a manner different from that set forth in
Sections 5.01 and 5.02, the Partnership shall adopt mutually
acceptable methods and conventions consistent with the provisions
of Section 704(c) of the Code and the Regulations thereunder which
are acceptable to both the IMC Partner (or, during the IMC GPCo
Liquidation Period, Operations and IMC GPCo) and the FRP Partner
and such methods and conventions shall control, solely for Federal
income tax purposes, allocations of items of Partnership income,
gain, loss and deduction. The method and conventions adopted by
the Partnership shall be designed, in general, (i) to allocate the
"built-in" gain or loss on the sale of a contributed property to
the contributor; (ii) to allocate the deductions from contributed
properties in a manner that reflects the Partners' respective
contributions of basis giving rise to such deductions (other than
special basis adjustments pursuant to Section 743 of the Code);
(iii) to preserve to the FRP Partner, for the benefit of FRP and
its partners, deductions attributable to special basis adjustments
pursuant to Section 754 of the Code resulting from the purchase of
interests in FRP; (iv) to adjust the allocations, to the extent
necessary, to reflect the sale of an asset contributed by a
Partner; (v) to eliminate the difference between the value at
which the property is shown on the books of the Partnership and
the property's adjusted tax basis; and (vi) to assist the FRP
Partner in integrating the allocations of the Partnership with
allocations to FRP and its partners in a reasonable manner.
5.04 Interim Closing of the Books on Transfer. In the event that
a Partner sells or exchanges all or a portion of its Partnership
Interest or a Partner's Partnership Interest is reduced, the Partners'
distributive share of items allocated to them pursuant to Sections 5.01
and 5.02 shall be determined as if the Partnership's books of account
were closed on the date on which such sale, exchange or reduction of
the Partnership Interest occurred; provided, that, to the extent such
determination relates to transactions contemplated by the IMC GPCo Plan
of Liquidation and the optional merger, liquidation or dissolution of
Agrico LP (or the transfer of its Partnership Interests to FRP or an
Affiliate of FRP) as contemplated by the Amendment, Waiver and Consent
Agreement, such determination shall be based upon any permissible
method elected by the Tax Matters Partner.
5.05 Disagreement Between Partners. In the event of a
disagreement between the IMC Partner and the FRP Partner concerning the
correct calculation of the allocations pursuant to this Article V, the
correct calculation of such allocations shall be treated as a Major
Decision and shall be determined by the Policy Committee, the CEOs or
the Managing Partner, as the case may be, pursuant to Section 6.07(a)
and Section 6.07(b).
5.06 Obligations with Respect to Distributable Cash.
Notwithstanding any other provision of this Agreement other than
Sections 3.03 and 5.07(d), but subject to the terms of any agreement or
instrument to which the Partnership is a party, the Partnership shall
distribute quarterly all Distributable Cash to the Partners.
5.07 Distribution of Distributable Cash; Suspended Distributions.
(a) Subject to the terms of any agreement or instrument to
which the Partnership is a party, as soon as available, but in any
event (i) not later than sixteen (16) days (or, in the case of a
quarter ending on June 30, not later than thirty (30) days)
following the end of each quarter of each Fiscal Year, commencing
with the end of the first quarter following the Closing, the
Partnership shall advise each Partner in writing of the amount of
Distributable Cash, if any, which will be distributed to each
Partner in respect of the previous quarter of the Fiscal Year,
(ii) in the case of a quarter ending June 30, not later than
sixteen (16) days following the end of such quarter, commencing
with the first such quarter following the Closing, the Partnership
shall advise each Partner in writing of its good faith estimate of
the amount of Distributable Cash, if any, which will be
distributed to each Partner in respect of the previous quarter of
the Fiscal Year and (iii) not later than 40 days following the end
of each quarter of each Fiscal Year, commencing with the first
quarter following the Closing, the Partnership shall distribute to
each Partner such Partner's Distributable Cash in respect of the
preceding quarter (adjusted, if required, as provided in Section
5.07(b) and Section 5.07(c) below); provided, however, that if the
Accounting Referee has not provided its report in accordance with
the terms of the Contribution Agreement prior to any such
distribution of Distributable Cash, the Managing Partner shall
consider the items or amounts that are the subject of dispute in
establishing any cash reserves of the Partnership, including,
without limitation, as such reserves relate to the calculation of
Current Interest Cash.
(b) Notwithstanding the foregoing, the allocation of
Distributable Cash to IMC GPCo and the FRP Partner for quarters
ending on or prior to June 30, 1994 shall be adjusted as follows:
(i) first, Distributable Cash shall be computed and
allocated to IMC GPCo and the FRP Partner for such quarter,
as if any Transaction Costs incurred by the Partnership in
such quarter had not been incurred;
(ii) second, an amount equal to 50% of any
expenditures for Transaction Costs incurred by the
Partnership during such quarter shall be subtracted from
the amounts calculated under clause (i) above; and
(iii) third, the amount so calculated pursuant to
clauses (i) and (ii) above shall be distributed to IMC GPCo
and the FRP Partner.
(c) Capital Proceeds in respect of a Material Asset Sale
shall be distributed, reinvested or retained by the Partnership as
determined by the Policy Committee or the CEOs, as the case may
be, at the time of approval of such Material Asset Sale in
accordance with the terms of Section 6.07. Capital Proceeds in
respect of all other Capital Transactions shall be distributed to
the Partners pursuant to Section 5.07(a) unless the Managing
Partner elects to use such Capital Proceeds to replace the capital
asset in respect of which such Capital Proceeds were generated or
otherwise to maintain (but not for the Expansion of) the business
of the Partnership.
(d) Notwithstanding the foregoing provisions of Sections
5.06, 5.07(a), 5.07(b) and 5.07(c), and in addition to the
suspension and repayment that is to occur under the circumstances
set forth in Section 3.03 hereof, if either Operations or FRP, or
either of their Affiliates, fails to pay any claim (a
"Contribution Agreement Claim") by the Partnership or another
Partner or any of its respective Affiliates (the "Non-Defaulting
Partner") under the Contribution Agreement and there is no good
faith dispute between Operations, or any of its Affiliates, and
FRP, or any of its Affiliates, as to the existence of such claim
or if either the IMC Partner (or, during the IMC GPCo Liquidation
Period, Operations or IMC GPCo) or the FRP Partner fails to make
any payment due hereunder (including, without limitation, any cash
contribution pursuant to Section 3.02) and there is no good faith
dispute among the Partners over the existence of such default,
then the Partnership shall suspend all payments and distributions
otherwise due hereunder to the Partner that has so defaulted or
whose parent entity has so defaulted (the "Defaulting Partner").
If a good faith dispute exists (i) between Operations, or any of
its Affiliates, and FRP, or any of its Affiliates, as to the
existence of a Contribution Agreement Claim or (ii) between the
IMC Partner (or, during the IMC GPCo Liquidation Period,
Operations or IMC GPCo) and the FRP Partner over the existence of
a default with respect to a payment due hereunder, then in each
such case, the parties to such dispute shall proceed to resolve
such dispute as soon as practicable pursuant to the Dispute
Resolution Mechanism. All payments and distributions otherwise
due to the Defaulting Partner hereunder, including, without
limitation, amounts determined by the Dispute Resolution Mechanism
to be a valid Contribution Agreement Claim or a defaulted payment
hereunder, shall instead be recouped and applied to what would
otherwise have been distributed to such Defaulting Partner to
reduce the claim of the Partnership or Partner or of their
Affiliate, as the case may be, until such time as the Contribution
Agreement Claim or such defaulted payment, as the case may be,
together with interest on the unpaid amount thereof at the rate
per annum equal to the lower of: (i) the maximum rate allowed by
law and (ii) the Prime Rate plus five percent (5%) has been paid
in full. The parties agree that with respect to a Contribution
Agreement Claim all amounts so recouped and paid to a Non-
Defaulting Partner shall satisfy such amounts owed by Operations
or FRP, as the case may be, or their Affiliates under the
Contribution Agreement. Upon payment in full of the Contribution
Agreement Claim or such defaulted payment, as the case may be
(together with such interest accrued thereon), the Partnership
shall resume payments and distributions to the Partners in
accordance with the provisions of Sections 5.07(a), 5.07(b) and
5.07(c).
5.08 Payment of Transaction Costs. The Partnership shall
promptly reimburse any Partner for any Transaction Costs incurred and
actually paid by such Partner. Any such Transaction Costs incurred
prior to the date of this Agreement, and not previously reimbursed by
the Partnership, will be promptly reimbursed by the Partnership
following such date.
ARTICLE XX.Xxxxxxxxxx
6.01 Operation. The business and affairs of the Partnership
shall be managed and conducted by the Managing Partner, who shall have
full control over and responsibility for such business and affairs, in
all cases subject to the provisions of this Agreement. The Managing
Partner shall perform its duties and obligations hereunder as an
ordinary prudent and reasonable manager would under similar
circumstances.
It is understood and agreed that regardless of the fact that the
Managing Partner may enter into transactions, agreements, arrangements
and understanding with the Operating Partner or its Affiliates,
including, without limitation, the Marketing and Administrative
Services Agreement and the Leasing Agreement, in order for the
Operating Partner or such Affiliates to provide certain services to the
Managing Partner, the Managing Partner shall not be relieved of its
duties and obligations to provide services hereunder nor shall such
duties and obligations be altered by such transactions, agreements,
arrangements or understandings.
6.02 General Powers of the Managing Partner. Subject to the
terms, restrictions and limitations set forth elsewhere herein,
including, without limitation, those set forth in this Article VI, the
Managing Partner, on behalf of the Partnership, shall have full
authority and responsibility to do all things it deems necessary or
appropriate in the conduct of the business and affairs of the
Partnership, including, without limitation, (i) the determination of
the operations in which the Partnership will participate and the level
or rate of activity of such operations; (ii) the obtaining and
maintaining of all governmental licenses and permits necessary or
appropriate for the conduct of the activities of the Partnership; (iii)
the execution of normal banking transactions such as accepting
deposits, drawing of checks and otherwise making payments on behalf of
the Partnership; (iv) the maintaining or incurring of Debt, the making
of expenditures and the incurring of any other obligations it deems
necessary or appropriate for the conduct of the activities of the
Partnership; (v) the evaluation of confidential information furnished
to the Partnership by others in connection with the operation of the
Partnership's business or the evaluation by the Partnership of a
potential transaction; (vi) the acquisition, lease, disposition,
mortgage, pledge, encumbrance, hypothecation or exchange of any or all
of the assets of the Partnership; (vii) the use of the assets of the
Partnership (including, without limitation, cash on hand) in any manner
it deems necessary or appropriate in order to achieve the purposes of
the Partnership, including, without limitation, the financing of the
conduct of the activities of the Phosphate Chemicals Business and any
other operations of the Partnership, the extension of credit in the
ordinary course of business to Persons other than Affiliates of the
Managing Partner (except that the Managing Partner may cause the
Partnership to advance funds to it or its Affiliates in order to meet
payroll or other similar obligations with respect to its employees or
employees of its Affiliates who provide services to the Partnership, as
contemplated in Sections 9.06 and 9.11), the repayment of obligations
of the Partnership, the conduct of additional Partnership operations
and the purchase of assets; (viii) the negotiation and execution on any
terms it deems necessary or appropriate, and the performance of, any
contracts, conveyances or other instruments that it considers necessary
or appropriate to the conduct of the Partnership operations or the
implementation of its powers under this Agreement; (ix) the calculation
and distribution of Distributable Cash; (x) subject to Section 5.07(c)
and Section 5.07(d), the calculation and reinvestment, or distribution,
of Capital Proceeds; (xi) the selection, appointment and dismissal of
officers, employees, outside attorneys, accountants, consultants,
engineers and contractors to perform services for the Partnership, and
the determination of their compensation and other terms of employment
or hiring; (xii) the maintenance of such insurance (including self-
insurance) for the benefit of the Partnership as the Managing Partner
deems necessary or appropriate; (xiii) the formation of any further
limited or general partnerships, joint ventures or other relationships
that the Managing Partner deems necessary or appropriate, except that
the Managing Partner shall not, without the consent of the FRP Partner,
cause the Partnership to create, invest in, or become an equity owner
or partner in an entity which is subject to Federal income taxes; (xiv)
the control of any matters affecting the rights and obligations of the
Partnership, including the conduct of litigation and the incurring of
legal expenses and the settlement of claims and litigation; (xv) the
preparation of the Partnership's tax returns; (xvi) subject to Section
9.12, the hiring or engagement of its Affiliates (subject to the
supervision and control of the Managing Partner) to carry out the
obligations of the Managing Partner hereunder; (xvii) subject to
Section 9.07, the taking of all actions necessary or appropriate to
preserve life or property in the case of an emergency or necessary or
appropriate to comply with applicable law; and (xviii) the payment of
all taxes which may be levied or assessed against the Partnership or
its properties.
6.03 Limitations on the Partners; Relations Among Partners.
(a) Except as set forth in Section 6.02 with respect to
the Managing Partner, but in all cases subject to Section 6.07, no
Partner shall, in the name of, or on behalf of the Partnership,
act without the prior consent of the Policy Committee or the
approval of the two CEOs or the Managing Partner contemplated by
Section 6.07(b), as the case may be.
(b) No Partner shall be liable to third Persons for
Partnership losses, deficits, liabilities or obligations except as
specifically otherwise provided herein or expressly agreed to in
writing by such Partner, unless the assets of the Partnership
shall first be exhausted.
(c) In any matter between the Partnership on the one hand
and any of the Partners on the other hand or in any matter between
the Partners, neither the Partnership nor any Partner shall be
bound by the act of a Partner unless such Partner is acting in
accordance with the limitations and provisions set forth in this
Agreement or with the consent of each other Partner.
6.04 Policy Committee.
(a) The responsibility and authority for establishing
policies relating to the strategic direction of the Partnership
and assuring that such policies are implemented shall be vested in
a policy committee (the "Policy Committee"). All decisions
concerning the management and control of the Partnership that are
approved by the Policy Committee shall be binding on the
Partnership and the Partners. Except as otherwise stated herein,
the Managing Partner shall use all commercially reasonable efforts
to act in accordance with the budgets and policies established by,
and other determinations made by, the Policy Committee or the two
CEOs or the Managing Partner, as the case may be, in accordance
with Section 6.07.
(b) The Policy Committee shall consist of four (4)
members, two (2) of whom shall be representatives of the IMC
Partner selected by the IMC Partner (each an "IMC Representative"
and, collectively, the "IMC Representatives") and two (2) of whom
shall be representatives of the FRP Partner selected by the FRP
Partner (each an "FRP Representative" and, collectively, the "FRP
Representatives" and, together with the IMC Representatives, the
"Representatives"). A Representative of the Operating Partner
shall serve as Chairman of the Policy Committee. The IMC Partner
and the FRP Partner shall, within ten (10) days of the date
hereof, notify each other in writing of the identity of the IMC
Representatives and the FRP Representatives, respectively. The
IMC Partner, within (10) days of the date hereof, shall notify the
other Partners in writing as to which of its Representatives is to
initially serve as Chairman of the Policy Committee. Any person
selected by the IMC Partner or the FRP Partner to serve as an IMC
Representative or an FRP Representative shall continue to serve in
such capacity until such Partner shall have notified the other
Partners in writing of his or her replacement. The IMC Partner
and the FRP Partner may, by written notice to the other, designate
a person to serve as an alternate for each IMC Representative and
each FRP Representative, respectively (each alternate to an IMC
Representative being referred to herein as an "IMC Alternate" and,
collectively, as the "IMC Alternates"; each alternate to an FRP
Representative being referred to herein as an "FRP Alternate" and,
collectively, as the "FRP Alternates"; and the IMC Alternates and
the FRP Alternates being collectively referred to herein as the
"Alternates"), and such IMC Alternate or FRP Alternate, as the
case may be, shall be entitled, in the absence of such IMC
Representative or FRP Representative, to vote on behalf of such
IMC Representative or FRP Representative at any meeting of the
Policy Committee. Each Partner and its Affiliates, in dealing
with IMC Representatives or Alternates or the FRP Representatives
or Alternates, as the case may be, shall be entitled to rely
conclusively upon the power and authority of such Representatives
or Alternates to bind the IMC Partner or the FRP Partner, as the
case may be, with respect to all matters unless and until it
receives notice to the contrary in writing from the IMC Partner or
the FRP Partner, as the case may be. To the fullest extent
permitted by law, each Representative and Alternate shall be
deemed the agent of the Partner which appointed such Person a
Representative and Alternate, and such Representative or Alternate
shall not be deemed an agent or a sub-agent of the Partnership or
the other Partners and shall have no duty (fiduciary or otherwise)
to the Partnership or the other Partners. Each Partner, by
execution of this Agreement, agrees to, consents to, and
acknowledges the delegation of powers and authority to such
Representative and Alternatives, and to the actions and decisions
of such Representative and Alternates within the scope of their
respective authority as provided herein.
(c) The Policy Committee shall hold regular meetings at
least once during each quarter of each Fiscal Year on dates
specified by the Policy Committee and may meet for special
meetings at the call of any Partner on at least twenty (20) days'
notice to the other Partners (or such shorter periods as may be
necessary in an emergency). Attendance by any IMC Representative
or FRP Representative or any IMC Alternate or FRP Alternate at any
meeting of the Policy Committee shall constitute an effective
waiver of any required prior notice to the IMC Partner or the FRP
Partner, as the case may be, of such meeting. The Chairman of the
Policy Committee shall, (i) with reasonable advance notice (which
in the case of regular quarterly meetings shall not be less than
fourteen (14) days), prepare and distribute an agenda for each
meeting of the Policy Committee, (ii) organize and conduct such
meeting and (iii) prepare and distribute minutes of such meeting.
Any Partner may propose in advance topics for the agenda or raise
topics which are not on the agenda for such meeting. In addition
to the Representatives and Alternates of the Partners serving on
the Policy Committee each Representative or Alternate of each of
the IMC Partner and the FRP Partner may bring one or more other
advisors to any meeting; provided that such advisors shall not
have the right to vote on any matter brought before the Policy
Committee; and provided, further that the Representatives or
Alternates of either of the IMC Partner or the FRP Partner shall
have the right to call executive sessions of the Policy Committee
and to exclude any Person not a Representative or Alternate from
such executive session unless such Person is an employee of a
Partner or its parent entity.
(d) Meetings of the Policy Committee may only be held when
a quorum is present. Except as set forth in the last sentence of
this Section 6.04(d), a quorum of the Policy Committee shall be
comprised of four (4) Representatives or Alternates (or any
combination thereof), which quorum shall be comprised of two (2)
IMC Representatives or IMC Alternates (or any combination thereof)
and two (2) FRP Representatives or FRP Alternates (or any
combination thereof). The affirmative vote of a majority of the
Policy Committee at a meeting at which a quorum is present (two
(2) IMC Representatives or IMC Alternates (or any combination
thereof) and two (2) FRP Representatives or FRP Alternates (or any
combination thereof) being entitled to vote at any such meeting,
except as set forth in the final two (2) sentences of this Section
6.04(d)) must be obtained in connection with the decision of any
matter being considered by the Policy Committee; provided, that in
the case of a business opportunity presented to the Partnership by
a Presenting Partner pursuant to Section 2.08(b) or pursuant to
Section 3.0 of the Parent Agreement or a Real Estate Development
Project presented to the Partnership by a Developing Partner
pursuant to Section 2.08(c), the election as to whether to pursue
or not to pursue such business opportunity or Real Estate
Development Project, as the case may be, shall be made by the
affirmative vote of two (2) Representatives or Alternates (or any
combination thereof) of the Exercising Partner or the Electing
Partner, as the case may be. Representatives or Alternates (or
any combination thereof) constituting a quorum may, upon their
unanimous consent, participate in a meeting of the Policy
Committee by means of conference telephone or similar
communications equipment which makes it possible for all persons
participating in the meeting to hear each other. Representatives
or Alternates (or any combination thereof) may consent to any
action without a meeting through a consent in writing of two (2)
IMC Representatives or IMC Alternates (or any combination
thereof), and two (2) FRP Representatives or FRP Alternates (or
any combination thereof) or, in the circumstances described in the
proviso to the second preceding sentence above, of two
Representatives or Alternates (or any combination thereof) of the
Exercising Partner or the Electing Partner, as the case may be.
Notwithstanding any provision of this Agreement to the contrary,
if either the IMC Partner (or, during the IMC GPCo Liquidation
Period, Operations or IMC GPCo) or the FRP Partner defaults in any
obligation to pay money (including, without limitation, any cash
contribution pursuant to Section 3.02 and any amounts payable
under the Contribution Agreement) as and when due hereunder and
such default remains uncured after the expiration of thirty (30)
days from and after notice thereof to such Partner by any other
Partner and there is no good faith dispute among the Partners or
their Affiliates over the existence of such default (with any such
good faith disputes among the Partners or their Affiliates to be
resolved as soon as practicable pursuant to the Dispute Resolution
Mechanism), neither the defaulting Partner's Representatives nor
Alternates (which, during the IMC GPCo Liquidation Period, with
respect to either Operations or IMC GPCo shall mean neither the
IMC Representatives nor the IMC Alternates) shall be entitled to
vote on, or consent to, any matter before the Policy Committee
until such time as the default has been cured by the defaulting
Partner (but they shall continue to receive notice of and to be
able to attend meetings of the Policy Committee), and during such
period the Policy Committee shall be entitled to exercise all of
its power and authority as set forth in this Partnership Agreement
upon the vote at a meeting (or by telephone or other similar
communications equipment as set forth above) or by written consent
of two (2) of the Representatives or Alternates (or any
combination thereof) of the non-defaulting Partner. In any such
event, the presence at a meeting in person (or by telephone or
other similar communications equipment as set forth above) of two
(2) Representatives or Alternates (or any combination thereof) of
the non-defaulting Partner shall constitute a quorum for the
transaction of business.
6.05 Rules of Procedure. The Policy Committee may from time to
time adopt detailed rules and procedures not inconsistent with this
Agreement for the management of the business of the Partnership.
6.06 Further Management Limitations. Under no circumstances
shall the Policy Committee have the power to alter or modify in any
manner the terms of this Agreement.
6.07 Major Decisions.
(a) Except as provided in Section 6.07(b) below, no act
shall be taken or sum expended or obligation incurred by the
Partnership, the Policy Committee or any Partner concerning a
matter within the scope of any of the Major Decisions set forth
below (each a "Major Decision"), unless and until the Major
Decision (A) shall be approved by the Policy Committee or the CEOs
or (B) is permitted to be taken by the Managing Partner pursuant
to Section 6.07(b). The Major Decisions shall consist of:
(i) creating any Debt of the Partnership in an
aggregate amount at any time outstanding exceeding the Base
Obligation Amount applicable at the time when such Debt is
incurred; provided that no approval by the Policy Committee
or the CEOs will be required for borrowings by the
Partnership for working capital purposes pursuant to a
credit facility (or a working capital contribution
facility) previously approved by the Policy Committee (or,
if not by the Policy Committee, by the CEOs); and provided,
further that the Partners shall have the right to make
Partner Loans to the Partnership in accordance with Section
3.03 without the approval of the Policy Committee or the
CEOs;
(ii) making, or committing to make, any capital
expenditures for Expansion in an annual aggregate amount in
any Fiscal Year in excess of the Base Obligation Amount for
such Fiscal Year;
(iii) making, or committing to make, any Material
Asset Sale;
(iv) approving annual operating and capital
expenditure budgets, quarterly updates of such budgets and
any increase in excess of 15% in any previously approved
capital budget item having a dollar amount in any Fiscal
Year in excess of the Base Budget Amount for such Fiscal
Year, it being understood that if any quarterly update of a
previously approved annual operating or capital expenditure
budget is not approved by the Policy Committee, or the CEOs
pursuant to Section 6.07(b), as the case may be, the
Managing Partner shall have the authority to continue to
operate and manage the business and affairs of the
Partnership in accordance with the most recently approved
annual operating or capital expenditure budget, as the case
may be, as such budget has been updated by any previously
approved quarterly budget update;
(v) calculating Distributable Cash and making
distributions of Distributable Cash in accordance with
Section 5.07;
(vi) entering into, or modifying or amending in any
material respect, any agreement which expressly restricts
the Partnership's right to distribute Distributable Cash to
the Partners;
(vii) incurring a Material Obligation (other than
Debt permitted to be incurred pursuant to
Section 6.07(a)(i));
(viii) (A) shutting down any Material Facilities of
the Partnership if, in the good faith judgment of the
Managing Partner, such shut down is expected to last more
than three (3) months or (B) continuing to keep any
Material Facilities of the Partnership shut down (other
than a shut down covered by clause (A) above which was
properly approved by the Policy Committee or, if not by the
Policy Committee, by the CEOs) for a period in excess of
three (3) months;
(ix) approving and determining the amount of any cash
contributions by the Partners to be made pursuant to
Section 3.02;
(x) entering into, or modifying or amending in any
material respect, any transactions, agreements,
arrangements or understandings between or on behalf of the
Partnership, on the one hand, and the Operating Partner or
any Affiliate of the Operating Partner, on the other hand,
in an aggregate amount in any Fiscal Year in excess of the
Base Affiliate Transaction Amount for such Fiscal Year,
other than the transactions, agreements, arrangements or
understandings referenced in Section 9.12;
(xi) entering into any settlement agreement with
respect to any suit, claim, action or proceeding involving
payment by the Partnership of an amount in excess of one
million dollars ($1,000,000); or
(xii) calculating the allocations pursuant to Article
V, in the event of a disagreement between the IMC Partner
(or, during the IMC GPCo Liquidation Period, Operations or
IMC GPCo) and the FRP Partner relating thereto.
(b) Notwithstanding the foregoing, if the Policy Committee
fails to approve any matter before it in accordance with the terms
of Sections 6.04 and 6.05, after discussion in good faith,
resolution of such matter shall be referred to the respective
Chief Executive Officers ("CEOs") of the Non-Managing Partners at
the time such matter is presented for resolution. Except as
provided in Section 6.07(c) below, if such CEOs fail to agree on
any matter within fourteen (14) days of the date the matter was
submitted to them, pending final resolution of the dispute, the
Managing Partner shall have the authority to operate the business
and affairs of the Partnership in such a manner as it reasonably
determines to be necessary in order to maintain the value of the
assets of the Partnership or as required to assure compliance with
applicable law, including without limitation taking the following
actions:
(i) establishing annual operating and capital
expenditure budgets (including maintenance capital and
capital expenditures for Expansion in an aggregate amount
in any Fiscal Year not exceeding the Base Obligation Amount
for such Fiscal Year);
(ii) calculating Distributable Cash and distributing
Distributable Cash in accordance with Section 5.07;
(iii) (A) shutting down any Material Facilities of
the Partnership if, in the good faith judgment of the
Managing Partner, such shut down is expected to last more
than three (3) months or (B) continuing to keep any
Material Facilities of the Partnership shut down (other
than a shut down covered by clause (A) above which was
properly approved by the Policy Committee or, if not by the
Policy Committee, by the CEOs or properly undertaken by the
Managing Partner) for a period in excess of three (3)
months; or
(iv) calculating the allocations pursuant to Article
V, in the event of a disagreement between the IMC Partner
(or, during the IMC GPCo Liquidation Period, Operations or
IMC GPCo) and the FRP Partner relating thereto.
(c) Notwithstanding the foregoing Section 6.07(b), in no
event shall the Managing Partner take any of the following actions
without the prior approval of either the Policy Committee or the
CEOs in accordance with Section 6.07(a) or Section 6.07(b), as the
case may be:
(i) creating any Debt of the Partnership in an
aggregate amount at any time outstanding exceeding the Base
Obligation Amount applicable at the time when such Debt is
incurred; provided that no approval by the Policy Committee
or the CEOs will be required for borrowings by the
Partnership for working capital purposes pursuant to a
credit facility (or a working capital contribution
facility) previously approved by the Policy Committee (or,
if not by the Policy Committee, by the CEOs); and provided,
further that the Partners shall have the right to make
Partner Loans to the Partnership in accordance with Section
3.03 without approval of the Policy Committee or the CEOs;
(ii) making, or committing to make, any capital
expenditures for Expansion in an aggregate amount in any
Fiscal Year in excess of the Base Obligation Amount for
such Fiscal Year;
(iii) making, or committing to make, any Material
Asset Sale;
(iv) entering into, or modifying or amending in any
material respect, any agreement which expressly restricts
the Partnership's right to distribute Distributable Cash to
the Partners;
(v) incurring a Material Obligation (other than Debt
permitted to be incurred pursuant to Section 6.07(a)(i));
(vi) approving and determining the amount of any cash
contributions by the Partners to be made pursuant to
Section 3.02;
(vii) entering into, or modifying or amending in any
material respect, any transactions, agreements,
arrangements or understandings between or on behalf of the
Partnership, on the one hand, and the Operating Partner or
any Affiliate of the Operating Partner, on the other hand,
in an aggregate amount in any Fiscal Year in excess of the
Base Affiliate Transaction Amount for such Fiscal Year,
other than the transactions, agreements, arrangements or
understandings referenced in Section 9.12;
(viii) entering into any settlement agreement with
respect to any suit, claim, action or proceeding involving
payment by the Partnership of an amount in excess of one
million dollars ($1,000,000); or
(ix) engaging in any activity prohibited by Section
9.05.
6.08 Management of Certain Environmental Liabilities. The
Partners agree that after the Closing Date the IMC Partner and the FRP
Partner will consult with each other concerning negotiation,
remediation and expenditures to be made by the Partnership or the
Partners, as the case may be, for the Environmental Liabilities listed
on Part I and Part II of Schedule 2.05(iv) to the Contribution
Agreement (each a "Retained Environmental Liability"). The Partnership
and the Partners agree to provide to the Partner whose Affiliate
contributed the Assets to which such Retained Environmental Liability
relates (or, in a case in which Operations contributed such Assets, to
Operations) (the "Retaining Partner") access to all relevant
information on an ongoing basis relating to such Environmental
Liability and to enter into discussions in good faith to determine the
most efficient use of money by the Partnership or the Retaining
Partner, as the case may be, in an effort to ensure the Partnership's
continued use of (or other appropriate action agreed to by the Partners
with respect to) the Assets to which such Environmental Liability
relates. The Partners further agree to permit the Retaining Partner,
upon written notification to the other Partners, to directly manage and
oversee all negotiations, agreements to remediate and remediation
activities relating to any Retained Environmental Liability to the
extent the management of such negotiation and remediation will not
unreasonably interfere with the day-to-day use of such Assets or result
in an unreasonable increase in costs to the Partnership (such cost
increases to be reimbursed to the Partnership by such Retaining Partner
managing such negotiation and remediation). With respect to any
Environmental Liability listed on such Schedule 2.05(iv) that shall be
an Assumed Liability, each Partner shall cause the Partnership to act
as quickly as is commercially reasonable to complete all required
remedial activity.
ARTICLE VII.
Encumbrance or Transfer of Partnership Interest
7.01 Transfer of Partnership Interest Generally. No Partner may
assign, transfer or otherwise dispose of all or any portion of its
Partnership Interest except in accordance with the terms of this
Article VII. Any attempt by any Partner to assign, transfer or
otherwise dispose of all or any portion of its Partnership Interest
other than in accordance with this Article VII shall be null, void ab
initio and of no force and effect. Notwithstanding any other provision
of this Article VII, the transfers of the Partnership Interest of IMC
GPCo to Operations executed in connection with the IMC GPCo Liquidation
and, in the event that FTX and FRP choose to cause the merger,
liquidation or dissolution of the FRP Partner (or the transfer by the
FRP Partner of its Partnership Interests to FRP or an Affiliate of FRP)
in accordance with the terms of the Amendment, Waiver and Consent
Agreement, transfers of the Partnership Interest of the FRP Partner to
FRP or an Affiliate of FRP executed in connection with such merger,
liquidation or dissolution of the FRP Partner (or such transfer of the
Partnership Interests), shall be deemed to have been made in accordance
with the terms of this Article VII.
7.02 Transfers of Partnership Interests. (a) Except as
otherwise consented to in writing by each of the other Partners, no
Partner may sell, transfer or otherwise dispose of all or any portion
of its Partnership Interest (collectively "Transfer") unless (i) such
Transfer is pursuant to a written agreement pursuant to which the
transferee agrees to be bound by all of the terms of this Agreement as
if it were originally a party hereto, (ii) such Transfer does not cause
a termination of the Partnership for Federal income tax purposes, (iii)
the transferring Partner shall have transferred a proportionate amount
of its capital stock of the Managing Partner to the transferee of all
or a portion of the Partnership Interest as required by Section 7.05
and (iv) such Transfer is in compliance with Section 7.02(b) and
Section 7.04.
(b) If either the IMC Partner (or, during the IMC GPCo
Liquidation Period, Operations or IMC GPCo) or the FRP Partner (in any
such case, the "Soliciting Partner") desires to sell or otherwise
dispose of to any third party (other than an Affiliate of such
Soliciting Partner), or to solicit bids from any third party (other
than an Affiliate of such Soliciting Partner) to purchase or otherwise
acquire, all or any part of its Partnership Interest (the "Subject
Partnership Interest"), such Soliciting Partner shall (i) if the
Soliciting Partner is the IMC Partner (or, during the IMC Liquidation
Period, Operations or IMC GPCo), notify the FRP Partner in writing of
the IMC Partner's desire to sell its Subject Partnership Interest or
(ii) if the Soliciting Partner is the FRP Partner, notify the IMC
Partner (or, during the IMC GPCo Liquidation Period, Operations and IMC
GPCo) in writing of its desire to sell its Subject Partnership
Interest. The notice referred to in the preceding sentence is
hereinafter referred to as the "Notice of Intent to Sell", and the
Partner receiving the Notice of Intent to Sell is hereinafter referred
to as the "Notified Partner". For a period (the "No-Shop Period") of
thirty (30) days following the date it gives Notice of Intent to Sell,
and during the duration of any Negotiation Period (as defined below),
neither the Soliciting Partner nor any of its Affiliates, officers,
directors, employees, representatives or agents will, without the prior
written consent of the Notified Partner, commence or continue any
discussions, negotiations or exchanges of information with any Person
other than the Notified Partner with respect to the sale of the Subject
Partnership Interest. During the No-Shop Period, both the Soliciting
Partner and the Notified Partner shall cooperate with each other in
exchanging all due diligence materials they deem to be reasonably
necessary to determine the price and terms of any potential offer. If
the Notified Partner makes a bona fide offer to purchase the Subject
Partnership Interest prior to the end of the No-Shop Period, then the
Soliciting Partner and the Notified Partner shall negotiate in good
faith for the purchase and sale of the Subject Partnership Interest and
the No-Shop Period shall be extended for fifteen (15) days (the
"Negotiation Period"); provided that a decision to accept or reject
shall be in the sole discretion of the Soliciting Partner. If the
Notified Partner fails to make a bona fide offer to purchase the
Subject Partnership Interest (the making or failure to make such offer
being in its sole discretion) prior to the expiration of the No-Shop
Period or if the Soliciting Partner and the Notified Partner fail to
execute a letter of intent relating to the purchase and sale of the
Subject Partnership Interest or terminate negotiations prior to the
expiration of the Negotiation Period, then the Soliciting Partner may,
but shall not be obligated to, immediately commence discussions,
negotiations or exchanges of information with, and/or sell its Subject
Partnership Interest to, any third party; provided that if the Notified
Partner made a bona fide offer during the No-Shop Period, the
Soliciting Partner shall not so sell the Subject Partnership Interest
to a third party unless (i) definitive, binding agreements relating to
such sale are executed within two hundred twenty (220) days of the
expiration of the Negotiation Period, (ii) the cash value of the
consideration received in connection with such sale is at least equal
to 95% of the cash value of such offer made by the Notified Partner and
(iii) the transferee of such Subject Partnership Interest agrees in
writing to be bound by the terms of this Agreement as if it had
originally been a party hereto. The cash value of such sale and the
cash value of such offer by the Notified Partner, respectively, shall
be determined by agreement among the Soliciting Partner and the
Notified Partner (i) in the case of the cash value of such sale, within
ten (10) days following the execution of definitive, binding agreements
by the parties relating thereto and (ii) in the case of the cash value
of such offer by the Notified Partner, within ten (10) days following
the earliest to occur of (A) the termination of negotiations between
the Soliciting Partner and the Notified Partner and (B) the expiration
of the Negotiation Period, provided that if such agreement is not
reached during either of such ten (10) day periods, then, in either
such case, such cash value shall be determined by means of the
Appraisal Procedure, with the expense thereof to be paid fifty percent
(50%) by the Soliciting Partner and fifty percent (50%) by the Notified
Partner and with the determination made thereby being final,
unappealable, binding on both the Soliciting Partner and the Notified
Partner and enforceable in a court of law or equity. After the
expiration of such two hundred twenty (220) day period, such Subject
Partnership Interest shall again be subject to the terms of this
Section 7.02(b). The failure of either the Soliciting Partner or the
Notified Partner to exercise its rights under this Section 7.02(b)
shall not be deemed to be a waiver of its respective rights under this
Section 7.02(b) with respect to subsequent Subject Partnership
Interests.
7.03 Liens. None of IMC GPCo (prior to the completion of the
Final IMC GPCo Liquidating Distribution), Operations (subsequent to the
completion of the Initial IMC GPCo Liquidating Distribution), the FRP
Partner (prior to or subsequent to the merger, liquidation or
dissolution of the FRP Partner (or the transfer of its Partnership
Interests) contemplated by the terms of the Amendment, Waiver and
Consent Agreement) or the Managing Partner may, except with the consent
of the other Partners (which consent may be granted or withheld in such
Partners' sole discretion), create or permit to exist any Lien on its
Partnership Interest or any portion thereof or any of the capital stock
of the Managing Partner (except (i) Liens for current taxes not
delinquent or taxes being contested in good faith and by appropriate
proceedings or (ii) Liens arising in the ordinary course of business
for sums not due or sums being contested in good faith and by
appropriate proceedings). Any attempt by any such Partner to create or
permit to exist any Lien (other than the excepted Liens described in
this Section 7.03) on its Partnership Interest or any portion thereof
shall be null, void ab initio and of no force and effect.
Notwithstanding anything to the contrary contained herein, if any
Person obtains a Lien on the Partnership Interest of IMC GPCo,
Operations, the FRP Partner or the Managing Partner or any portion
thereof (during a period during which such a Lien could not be granted
to such Person in accordance with the terms of this Section 7.03) and
forecloses on such Lien, (i) the Partnership shall continue, (ii) the
Person foreclosing on the Lien shall succeed to the economic interests
of the Partnership Interest, or portion thereof, upon which it
foreclosed but not the voting or other interests which comprise such
Partnership Interest, or portion thereof, (iii) the Person foreclosing
on such Lien shall not be admitted as a "Partner" without the approval
of the Policy Committee or the other Partners, and (iv) any sale or
other disposition of the Partnership Interest, or portion thereof, upon
which such Person foreclosed shall be subject to the terms of Article
VII hereof.
7.04 Transfers Upon Triggering Events.
(a) Upon the occurrence of a Triggering Event, the
Triggering Partner shall give the other Partners prompt written notice
of such Triggering Event (the "Triggering Event Notice"), which notice
shall describe the terms and conditions of the transaction giving rise
to the Triggering Event. For a period of thirty (30) days following
the receipt of the Triggering Event Notice (or, if no Triggering Event
Notice is received, at any time after a Triggering Event has occurred),
the Non-Triggering Partner (which, during the IMC GPCo Liquidation
Period, shall mean both Operations and IMC GPCo, for purposes of this
Section 7.04, if the IMC Partner is the Non-Triggering Partner) shall
have the right to sell, and, upon the receipt of notice (the "Exercise
Notice") of the exercise of such right from the Non-Triggering Partner,
the Triggering Partner shall have the obligation to purchase, all but
not less than all of the Non-Triggering Partner's Partnership Interest
at the Transfer Price applicable to such Triggering Event; provided,
however, that (i) if the transaction that gave rise to the Triggering
Event involved the sale of all or a portion of the Partnership Interest
of the Triggering Partner, the Non-Triggering Partner shall instead
have the right to sell all, but not less than all of its Partnership
Interest to the purchaser (the "Purchasing Partner") of the Triggering
Partner's Partnership Interest and the Purchasing Partner, by its
execution and delivery of a counterpart hereof on the closing date with
respect to the purchase and sale of the Triggering Partner's
Partnership Interest, agrees to purchase the Non-Triggering Partner's
Partnership Interest at the Transfer Price applicable to such
Triggering Event, (ii) if the Exercise Notice was delivered to the
Triggering Partner and the Triggering Partner fails to purchase the Non-
Triggering Partner's Partnership Interest within the period specified
above, then, without limiting its rights against such party, the Non-
Triggering Partner shall then have the right to sell all, but not less
than all, of its Partnership Interest to either the Purchasing Partner
or the Partnership, and upon receipt of an Exercise Notice, the
Purchasing Partner or the Partnership, as the case may be, shall be
obligated to purchase the Non-Triggering Partner's Partnership Interest
for cash at the Transfer Price applicable to such Triggering Event; and
(iii) if the Exercise Notice was delivered to the Purchasing Partner
and the Purchasing Partner fails to purchase the Non-Triggering
Partner's Partnership Interest within the period specified above, then,
without limiting its rights against such party, the Non-Triggering
Partner shall then have the right to sell all, but not less than all,
of its Partnership Interest to either the Triggering Partner or the
Partnership, and upon receipt of an Exercise Notice, the Triggering
Partner or the Partnership, as the case may be, shall be obligated to
purchase the Non-Triggering Partner's Partnership Interest for cash at
the Transfer Price applicable to such Triggering Event. The closing of
the sale of the Non-Triggering Partner's Partnership Interest shall
occur on or before the sixtieth (60th) day following the receipt of the
Exercise Notice by the Triggering Partner, the Purchasing Partner or
the Partnership, as the case may be; provided that if the Appraisal
Procedure is invoked to determine the Transfer Price, the time periods
in this sentence shall be extended to the date which is thirty (30)
days following the final determination of the Transfer Price. If a
Triggering Event Notice has been delivered and the Non-Triggering
Partner does not deliver an Exercise Notice within the thirty (30) day
period specified above, the Non-Triggering Partner shall be deemed to
have elected not to sell its Partnership Interest.
(b) The terms and conditions (other than the method of payment of
the Transfer Price) of any sale pursuant to this Section 7.04 shall be
customary for transactions of such type; provided that if the event
giving rise to this Triggering Event involves a sale of a Partnership
Interest, such terms and conditions shall be substantially similar to
the terms and conditions of the sale giving rise to the Triggering
Event, adjusted as appropriate to reflect differences in the structure
of the transactions. The Transfer Price payable in connection with any
sale of a Partnership Interest by a Non-Triggering Partner pursuant to
this Section 7.04 shall be payable in cash on the date of closing of
such sale. If the Transfer Price is determined in accordance with the
Appraisal Procedure, the expense thereof is to be paid fifty percent
(50%) by the Triggering Partner and fifty percent (50%) by the Non-
Triggering Partner.
(c) Any sale of a Partnership Interest by a Non-Triggering
Partner pursuant to this Section 7.04 shall be accompanied by a
corresponding sale of all of the issued and outstanding stock of the
Managing Partner then held by such Non-Triggering Partner in accordance
with Section 7.05.
7.05 Interests in Managing Partner. Except as provided in this
Section 7.05, neither the IMC Partner nor the FRP Partner shall sell,
transfer or otherwise dispose of all or any portion of the capital
stock of the Managing Partner. If either the IMC Partner or the FRP
Partner sells, transfers or otherwise disposes of all or a portion of
its Partnership Interest to any Person in accordance with the terms of
Section 7.02, then, simultaneously therewith, the Non-Managing Partner
making such a transfer shall so sell, transfer or otherwise dispose of
a proportionate amount of capital stock of the Managing Partner to such
Person.
7.06 Certain Conditions of Certain Transfers. As a condition to
the effectiveness of (i) the Initial IMC GPCo Liquidating Distribution,
(ii) the Final IMC GPCo Liquidating Distribution, (iii) the FRP
GPCo/FCC/FTX Mergers, (iv) the merger, liquidation or dissolution of
the FRP Partner (or the transfer of its Partnership Interests) in
accordance with the terms of the Amendment, Waiver and Consent
Agreement and (v) any related transactions, each Partner hereby agrees
to bear, and assume liability for, any expense, cost or loss (including
any increase in taxes, other than any increase in income taxes which
arises solely from the timing of the reporting of income, deductions
and credits attributable to the normal business activities of the
Partnership) suffered by the Partnership, any other Partner or any of
their Related Persons (as defined below) arising from consummation of
the transactions described in (i) to (v) above in violation of the
provisions of this Agreement, the Parent Agreement, the Amendment,
Consent and Waiver Agreement and the IMC GPCo Plan of Liquidation.
ARTICLE VIII.
Other Rights of, Duties and Restrictions on the Partners
8.01 Indemnification. All costs, expenses, liabilities,
obligations, losses, damages, penalties, proceedings, actions, suits or
claims of whatever kind or nature which may be imposed on, incurred by,
suffered by, or asserted against the Partnership, any Partner (which
term, for purposes of this Article VIII, shall, with respect to the IMC
Liquidation Period (and all other periods during which Operations or
IMC GPCo is a Partner) refer to each of Operations and IMC GPCo,
severally and not jointly) or any Partner's respective Affiliates,
directors, officers and employees, in connection with the ownership or
management or operation of the business and affairs of the Partnership
shall be referred to as "Claims". The Partnership shall indemnify and
hold harmless each Partner and their respective Affiliates, directors,
officers and employees ("Related Persons") for all Claims other than
those caused by such Partner's or such other Related Person's gross
negligence, wilful misconduct, wilful breach of this Agreement or
failure to follow a specific instruction from the Policy Committee
adopted in accordance with the terms of this Agreement; provided that
in no event shall the Partnership be required to indemnify any Partner
or any of its Related Persons for any Claim arising out of or relating
to any Excluded Liability for which such Partner or Related Person is
responsible pursuant to the terms of the Contribution Agreement. For
purposes of this Agreement, an ignoring of the terms of this Agreement
shall be deemed a wilful breach; provided that the Managing Partner
shall not be liable for ignoring the term of this Agreement requiring
the Managing Partner to act as an ordinary prudent and reasonable
manager if the Managing Partner acted in good faith and in the belief
(which was reasonable) that its actions were in accordance with all of
the terms of this Agreement. In addition to, and not in contravention
of, the foregoing, the Partnership shall indemnify and hold harmless
each Partner and their respective Related Persons from all Assumed
Liabilities and any and all costs, expenses, liabilities, obligations,
losses, damages, penalties, proceedings, actions, suits or claims of
whatever kind or nature which may be imposed on, incurred by, suffered
by, or asserted against any Partner or its respective Related Persons
arising out of or in connection with any Assumed Liability. The
Leasing Agreement and the Marketing and Administrative Services
Agreement shall contain provisions consistent with this Section 8.01.
8.02 Contribution. In the event that any Partner shall pay in
good faith or become obligated to pay any proper obligation of the
Partnership, such Partner shall be entitled to contributions from the
other Partners to the extent necessary so that, after giving effect to
such contributions, each Partner shall bear no more than that part of
such obligation which corresponds to its respective Capital Interest at
the time of the occurrence, circumstances, events or conditions giving
rise to the obligation.
8.03 Continuing Liability of Withdrawn Partner. In the event of
the withdrawal of a Partner from the Partnership by reason of the
transfer of its entire Partnership Interest in accordance with the
provisions of this Agreement, or in violation of this Agreement, such
withdrawn Partner shall remain liable as a general partner with respect
to all obligations of the Partnership incurred or accrued on or prior
to the date of withdrawal (but shall not have liability for obligations
of the Partnership incurred or which accrue subsequent to the date of
withdrawal). If the Partnership is continued without dissolution, or
reconstituted and continued, following the withdrawal of any Partner,
in either case in accordance with the terms of this Agreement, the
withdrawn Partner shall be entitled only to the payments expressly
provided for in this Agreement and shall not be entitled to any other
or further payments from the Partnership or any other Partner.
Further, in such circumstances, the withdrawn Partner shall have no
right to cause the winding up or liquidation of the business or assets
of the Partnership, and neither the Partnership nor any Partner shall,
as a condition to the continuation or reconstitution of the
Partnership, be required to post any bond in favor of, or indemnify,
the withdrawn Partner as regards past, present or future liabilities or
otherwise.
8.04 Breach of Parent Agreement. For purposes of this Agreement,
(i) a breach by FTX or FRP of the terms of the Parent Agreement shall
constitute a breach of this Agreement by the FRP Partner and (ii) a
breach by Global or Operations of the terms of the Parent Agreement
shall constitute a breach of this Agreement by the IMC Partner.
ARTICLE IX.
Certain Operational Provisions
9.01 Financial, Accounting, and Banking Matters.
(a) The Fiscal Year of the Partnership shall begin on July
1 and end on June 30 of each year of the Partnership.
(b) The auditors of the Partnership shall be Ernst & Young
or such other independent certified public accounting firm of
recognized national standing selected by the Policy Committee in
accordance with the terms of Sections 6.04 and 6.05, or if the
Policy Committee fails to so approve such a selection, then by the
CEOs or the Managing Partner, as the case may be, in accordance
with the terms of Section 6.07(b).
(c) The Partnership shall establish bank accounts at such
banks as may from time to time be designated by the Managing
Partner. The Partnership's funds shall be invested in such manner
as the Managing Partner deems appropriate. All bank and other
accounts shall be maintained in the Partnership's name. None of
the Partnership's funds shall be commingled with the funds of any
Partner unless previously approved in writing by the other
Partners.
9.02 Budget and Approval Authorities.
(a) The Managing Partner shall have the sole and exclusive
authority and responsibility to present annual operating and
capital budgets and quarterly updates of such budgets to the
Policy Committee for its approval, such quarterly updates to
present information on a month-by-month basis. As soon as
available, but not later than forty (40) days prior to the end of
each Fiscal Year, the Managing Partner shall, at a special meeting
of the Policy Committee called for such purpose, present to the
Policy Committee the operating and capital expenditure budgets for
the succeeding Fiscal Year. The Policy Committee shall review
such proposed budgets and shall either approve the proposed
budgets or negotiate in good faith with the Managing Partner to
adopt mutually acceptable budgets for such succeeding Fiscal Year.
As soon as available, but not later than sixty (60) days after the
end of a Fiscal Year and each quarter of the succeeding Fiscal
Year, the Managing Partner shall, at a special meeting of the
Policy Committee called for such purpose, present to the Policy
Committee the operating and capital expenditure budget updates for
the remaining portion of the then current Fiscal Year. The Policy
Committee shall review such proposed budget updates and shall
either approve the proposed budget updates or negotiate in good
faith with the Managing Partner to adopt mutually acceptable
budget updates for the remaining portion of the then current
Fiscal Year. If the Policy Committee adopts budgets for a Fiscal
Year or any portion thereof, the Managing Partner shall use all
commercially reasonable efforts to operate and manage the business
and affairs of the Partnership in accordance with such budgets
(or, if the Policy Committee fails to so adopt such budgets in
accordance with the terms of Sections 6.04 and 6.05 and if such
budgets are instead adopted by the CEOs or the Managing Partner,
as the case may be, in each case in accordance with the terms of
Section 6.07(b), then in accordance with such budgets).
(b) The Managing Partner shall have the sole and exclusive
authority and responsibility to present five (5) year operating
and financial forecasts for the Partnership to the Policy
Committee; provided that if the Managing Partner has not presented
such a five (5) year operating and financial forecast to the
Policy Committee on or before the sixtieth (60th) day of any
Fiscal Year for the succeeding five (5) years, the Managing
Partner shall provide the Non-Operating Partner with access to the
Managing Partner's operating and financial personnel and shall
cause such operating and financial personnel to assist the Non-
Operating Partner in preparing a five (5) year operating and
financial forecast for the Partnership.
9.03 Insurance. The Managing Partner shall have the authority
and responsibility to take whatever action (not inconsistent with the
terms hereof) it determines in good faith to be necessary or
appropriate to preserve and protect the assets of the Partnership,
including, without limitation, by procuring, for the account of the
Partnership, such insurance against such hazards and liabilities as the
Managing Partner deems appropriate in light of prudent industry
practice. All such insurance, whether maintained by the Managing
Partner, Operations or FRP for the benefit of the Partnership, may be
in the name of any Partner, Operations, FRP or the Partnership so long
as each insurance policy names the Partnership and each Partner as
either the "insured party" or an "additional insured party" and waives
subrogation in favor of each such party. Such insurance coverage may
be subject to such self-insurance, deductibles and limits as the
Managing Partner deems appropriate. If requested by the Managing
Partner, either of the Non-Managing Partners or their respective parent
entities shall cooperate with the Managing Partner in designing and
maintaining a risk management program which insures the Partnership
against such hazards and liabilities as the Managing Partner deems
appropriate, provided that if the Managing Partner requests either of
the Non-Managing Partners or their Affiliates to maintain insurance in
the name of the Partnership, the Partnership shall reimburse such Non-
Managing Partner or such Affiliates for all of the direct costs and
expenses incurred in connection with the maintenance of such insurance.
In addition to the insurance provided for the benefit of the
Partnership under this Section 9.03, each Partner and its Affiliates
shall have the right to purchase such other insurance as it deems
prudent to cover its respective interest in the Partnership; provided
that all costs and expenses incurred in connection with the maintenance
of such insurance shall be paid by such Partner and provided that such
insurance shall not have the effect of restricting the amount or
availability of insurance maintained by the Partnership. Should any
Partner or their Affiliates with respect to the Partnership purchase
such other insurance, such other insurance shall waive rights of
subrogation against the other Partners, the Partnership and their
Affiliates.
9.04 Financial and Other Information. The Managing Partner shall
deliver or cause to be delivered to each Partner:
(a) as soon as available, but not more than twenty (20)
days (or, in the case of June, forty-five (45) days) after the end
of each month during the term of the Partnership, (i) a statement
of the Distributable Cash and Capital Proceeds of the Partnership
for the preceding month and (ii) an estimate of the Distributable
Cash and Capital Proceeds of the Partnership for the remaining
months of the current quarter and for the entire succeeding
quarter of the Partnership;
(b) as soon as available, but not more than twenty (20)
days (or, in the case of June, forty-five (45) days) after the end
of each month in each Fiscal Year during the term of the
Partnership, the following reports of the Partnership: (i) a
Partnership consolidation (i.e. trial balance) for the preceding
month, (ii) a plant operating statement showing expenditures by
cost center and cost element compared with the budget for the
preceding month and year-to-date, (iii) a capital spending status
report;
(c) as soon as available, but not more than twenty (20)
days (or, in the case of June, forty-five (45) days) after the end
of each month in each Fiscal Year during the term of the
Partnership, (i) an unaudited Balance Sheet of the Partnership as
at the end of the preceding month, (ii) the unaudited related
Statement of Income of the Partnership, which shall include sales
volumes, revenues and margins by product, for the preceding month
and for the Fiscal Year-to-date and (iii) the unaudited related
Statement of Cash Flow of the Partnership for the preceding month
and for the Fiscal Year-to-date, it being understood that in the
case of clauses (ii) and (iii) such statements are to be presented
setting forth in each case in comparative form the corresponding
figures for the corresponding period of the previous Fiscal Year
and the plan for the current Fiscal Year, all in reasonable detail
and in accordance with generally accepted accounting principles
applied on a basis consistent with such prior fiscal periods
(except as otherwise specified in such report);
(d) as soon as available, but not more than twenty (20)
days (or, in the case of June, forty-five (45) days) after the end
of each month in each Fiscal Year during the term of the
Partnership, an analysis of the performance of the Partnership;
(e) as soon as available, but in any event within thirty
(30) days after the end of each quarter of each Fiscal Year during
the term of the Partnership a report providing the financial and
operating data for inclusion in the Partners' Affiliates'
respective reports on Form 10-K or Form 10-Q (or any successor
reports or forms thereof) required to be filed with the SEC as of
the end of such quarter;
(f) as soon as available, but in any event within ninety
(90) days after the end of each Fiscal Year during the term of the
Partnership, an audited Balance Sheet as at the end of such Fiscal
Year and the related Statements of Income and Cash Flow of the
Partnership for such Fiscal Year, setting forth in each case in
comparative form, the figures for the previous Fiscal Year of the
Partnership, all in reasonable detail, with applicable footnotes
and accompanied by a report thereon of Ernst & Young or such other
independent public accountants of recognized national standing
selected by the Partnership in accordance with the terms of
Section 9.01(b), which report shall state whether in its opinion,
such financial statements present fairly in all material respects
the financial position of the Partnership as at the dates
indicated and the results of its operations and cash flows for the
periods indicated, in conformity with generally accepted
accounting principles;
(g) promptly upon obtaining knowledge of any audit item
involving disclosure or any material accounting issue, written
notification of such disclosure or accounting issue;
(h) within sixty (60) days after the end of each Fiscal
Year during the term of the Partnership, a certificate of an
officer of the Managing Partner describing the material terms of
all transactions between the Partnership and Affiliates of the
Operating Partner during the preceding Fiscal Year;
(i) within twenty (20) days of the end of each calendar
year, the information that FRP and FTX reasonably request in order
for FRP and FTX to comply with the provisions of FASB 109; and
(j) promptly, any other financial reports delivered to the
Operating Partner's parent entity.
9.05 Qualifying Income.
(a) The Partnership shall not, without the written consent
of the FRP Partner, generate income other than Qualifying Income.
The Managing Partner shall take any action required to operate the
Partnership in a manner consistent with the requirement of this
Section 9.05(a).
(b) The Managing Partner shall provide the FRP Partner, on
a monthly basis, with the information and data reasonably
necessary for the FRP Partner to determine whether the requirement
of Section 9.05(a) will be met for the Partnership's taxable year.
The Managing Partner shall also provide the FRP Partner, on a
timely basis, with the information and data reasonably necessary
to determine whether any Major Decision defined in Section
6.07(a)(ii) or Section 6.07(a)(iv) will result in the failure of
the Partnership to meet the requirement of Section 9.05(a) for any
taxable year of the Partnership. Upon providing the FRP Partner
with information and data with respect to any current or proposed
source of Partnership income reasonably sufficient for FRP to
determine whether such income is or will be Qualifying Income, the
Managing Partner may request that the FRP Partner consent to the
Partnership's generation of such income. The FRP Partner shall
respond in writing to any such request in a timely manner and any
consent so expressed shall constitute consent by the FRP Partner
to the generation of such income for purposes of Section 9.05(a),
subject to any limitation on the amount or timing thereof stated
in such consent. If the FRP Partner does not respond in writing
to the Managing Partner's request within twenty-five (25) days of
the receipt of such request, the FRP Partner shall be deemed to
have consented to the Partnership's generation of such income for
purposes of Section 9.05(a).
(c) In the event that (i) the Partnership fails (or based
on all available information, the FRP Partner reasonably believes
the Partnership may fail) to meet the requirement of Section
9.05(a) for any taxable year or (ii) there is an amendment to
Section 7704 of the Code, the issuance of a Treasury Regulation
pursuant to Section 7704 of the Code, the amendment of any other
Code Section, or the issuance of any other Treasury Regulation or
pronouncement that, in the reasonable belief of the FRP Partner,
may affect the partnership status of the FRP Partner or FRP for
Federal income tax purposes, the Policy Committee shall meet to
determine what actions would be required to preserve the
partnership status of the FRP Partner and FRP for Federal income
tax purposes. If the Policy Committee determines (or, if the
Policy Committee fails to agree, if either the IMC Partner or the
FRP Partner reasonably and in good faith determines) that the
Partnership cannot be operated in a manner that is consistent with
achieving the Partnership's business purpose other than in a
manner that is inconsistent with preserving the partnership status
of the FRP Partner and FRP for Federal income tax purposes, the
Partners agree to negotiate in good faith to determine the
appropriate action to be taken. In the event that the IMC Partner
and the FRP Partner are unable to agree on the action to be taken
after negotiating in good faith, each of the IMC Partner and the
FRP Partner shall have the right to elect to dissolve the
Partnership. It is acknowledged that none of the Partners is
obligated to take any action, and the Partnership is not obligated
to take action, that is harmful to any Partner or its Affiliates,
other than the dissolution of the Partnership.
9.06 Work Force; Employee Benefits.
(a) The Managing Partner shall supply, for the account of
the Partnership, the necessary work force for the conduct of the
business and affairs of the Partnership. The work force to be
provided shall include but shall not be limited to qualified
miners, engineers, metallurgists, geologists, assayers, equipment
operators, helpers, mechanics, accountants, attorneys, purchasing
agents, sales personnel and support staff, together with necessary
supervisory and management personnel, and shall include, as
necessary, the services of the Leased IMC Employees. Consistent
with approved budgets, all members of the work force employed by
the Managing Partner for the purpose of providing services to the
Partnership shall be paid such salaries, hourly wages and benefits
and shall be subject to such other terms and conditions of
employment as the Managing Partner deems appropriate subject to
the following sentence of this Section 9.06. The Managing Partner
shall be reimbursed (in accordance with Section 9.11) for the cash
costs (i) incurred under the Leasing Agreement in connection with
the Leased IMC Employees including, but not limited to, salaries
and wages; social security taxes and payroll taxes; contributions
to the IMC Salaried Pension Plan and the Retirement Plan for Non-
Union Hourly Employees of IMC Fertilizer, Inc. and contributions
to the IMC Salaried Contribution Plan and the Savings Plan for
Hourly Employees of IMC Fertilizer, Inc.; any employee benefits
other than those described above, including, but not limited to,
benefits under any employee benefit plan (as defined in section
3(3) of the Employee Retirement Income Security Act of 1974, as
amended) or any retirement or deferred compensation plan, stock
plan, unemployment compensation plan, vacation pay, severance pay,
bonus or benefit arrangement, insurance or hospitalization program
or any other fringe benefit arrangement which does not constitute
an employee benefit plan, or any employment agreement, post-
retirement benefits, severance benefits or other employee benefits
for former Leased IMC Employees; and other governmental charges
relating to such employment; and (ii) of hiring and employing,
including, without limitation, (A) the cost of all social security
taxes, payroll taxes, post-retirement benefits of former Managing
Partner employees, other employee benefits and other governmental
charges related to such employment to the extent that the cost
thereof is associated with personnel employed or formerly employed
at production facilities as reflected, consistent with Operations'
historic practices, in the cost of goods sold income statement
caption and (B) the costs attributable to employees providing
management information services, public relations and internal
audit services provided directly to production facilities and
limited to those amounts reflected, consistent with Operations'
historic practices, in the cost of goods sold income statement
caption. To the extent that such personnel costs described at
clause (ii) above are included, consistent with Operations'
historic practices, in the selling and administrative expense
income statement caption for financial reporting purposes, such
costs shall be covered by the Administrative Fee described in
Section 9.11 and shall not be separately reimbursed or paid by the
Partnership.
(b) Subject to the terms and conditions of the
Contribution Agreement and to the extent permitted by applicable
law, the Managing Partner shall maintain employee benefit plans
(as defined in section 3(3) of ERISA) and retirement or deferred
compensation plans, unemployment compensation plans, vacation pay,
severance pay, bonus and benefit arrangements, insurance and
hospitalization programs and any other fringe benefit arrangements
for current and former employees, consultants and agents (whether
pursuant to contract, arrangement, custom or informal
understanding) which do not constitute employee benefit plans
(collectively, "Employee Benefit Plans") which are substantially
similar in all material respects to such plans, arrangements and
programs maintained from time to time by Operations, and shall
modify the provisions of the MP Pension Plans, MP Contribution
Plans and MP Benefit Plans to the extent changes are made to the
corresponding plan, contract or arrangement maintained by
Operations (the "IMC Plans") to the extent such changes to the IMC
Plans are commercially reasonable; provided, however, that nothing
in this Section 9.06(b) shall require the Managing Partner to
maintain any plan, arrangement or program for any employee who is
covered by a collective bargaining agreement, except to the extent
provided by such collective bargaining agreement.
9.07 Emergency Expenditures; Compliance with Law.
(a) If at any time as a result of any event there arises
an emergency where the Managing Partner determines that failure to
take prompt action may result in loss of life or material personal
injury or property damage, the Managing Partner shall have the
authority and responsibility to take such action and make such
immediate expenditures as the Managing Partner may deem necessary
to protect against loss of life, personal injury or damage to or
destruction of property, to safeguard lives and/or prudently
preserve and protect the optimum economic value of the assets of
the Partnership; provided that as soon as reasonably practicable
following the occurrence of such an emergency, the Managing
Partner shall notify the other Partners of the nature of the
emergency and the actions taken in response to such emergency.
(b) The Managing Partner shall have the authority and
responsibility to take such action and make such immediate
expenditures as it may deem necessary to manage and operate the
business and affairs of the Partnership in compliance with
applicable law; provided that if time permits, the Managing
Partner shall seek the approval of the Policy Committee prior to
making any expenditure pursuant to this Section 9.07(b) which
would otherwise have required such approval, and, if time does not
so permit, will promptly report such action or expenditures to the
Policy Committee.
(c) Any expenditure made pursuant to this Section 9.07
shall be deemed to constitute an approved expenditure without the
need or necessity for any action or approval by the Policy
Committee and shall not be included in determining whether the
Managing Partner is managing the business and affairs of the
Partnership within the operating and capital expenditure budgets
approved or adopted as described in Section 9.02 hereof.
9.08 No Action Contrary to Contracts or Applicable Law. The
Managing Partner agrees to use all commercially reasonable efforts not
to do or fail to do any act if it in good faith believes not doing or
failing to do such act is likely to result, or with the giving of
notice and/or the passage of time is likely to result, in (a) a default
under the terms of any mortgage, bond, indenture, agreement, lease or
other instrument or obligation to which the Partnership is a party or
by which its properties or assets may be bound; or (b) the violation of
any law, rule, regulation or ordinance or any judgment, order,
injunction, decree or award of any court, administrative agency or
governmental body against, or binding upon, the Partnership or its
properties or assets; provided, that, in the case of clause (a) above,
the covenant of the Managing Partner shall not apply if compliance
therewith would require the Managing Partner to make any capital or
other expenditures which are not provided for in an operating or
capital expenditure budget adopted by the Policy Committee (or by the
CEOs or the Managing Partner, as the case may be, pursuant to Section
6.07(b)), or otherwise approved by the Policy Committee or by the CEOs
or the Managing Partner in accordance with the terms of this Agreement
and, in the case of clause (b) above, any action or failure to act by
the Managing Partner taken to comply with the covenant shall be deemed
to be within its authority set forth in Section 9.07(b) and (c) hereof.
The Managing Partner shall promptly notify the Policy Committee in
writing of (i) the occurrence of any material default of which it has
knowledge under the terms of any mortgage, bond, indenture, agreement,
lease or other instrument or obligation to which the Partnership is a
party or by which its properties or assets may be bound, (ii) any
material violation of which it has knowledge of any law, rule,
regulation or ordinance or any judgment, order, injunction, decree or
award of any court, administrative agency or governmental authority
insofar as such violation relates to the Managing Partner, any Partner
or the Partnership, and (iii) any event which, with the delivery of
notice or the passage of time, or both, in the good faith belief of the
Managing Partner is likely to result in an event described in clause
(i) or (ii). The Managing Partner shall cause the Partnership to use
all commercially reasonable efforts to promptly cure or remedy any such
event within its control and for which it is responsible hereunder;
provided, that in the case of a cure or remedy relating to a default
described in clause (a) of the first sentence of this Section 9.08, the
covenant of the Managing Partner shall not apply if compliance
therewith would require the Partnership to make any capital or other
expenditures which are not provided for in an operating or capital
expenditure budget adopted by the Policy Committee (or adopted by the
CEOs or the Managing Partner, as the case may be, pursuant to Section
6.07(b)), or otherwise approved by the Policy Committee or by the CEOs
or the Managing Partner in accordance with the terms of this Agreement
and, in the case of a cure or remedy relating to a violation described
in clause (b) of the first sentence of this Section 9.08, any such cure
or remedy shall be deemed to be within the Managing Partner's authority
set forth in Section 9.07(b) and (c) hereof. The Managing Partner
shall represent the Partnership in any proceeding (whether formal or
informal) relating to any such event. At all times the Managing
Partner shall keep the Non-Managing Partners informed of the current
status and all significant developments in all such proceedings or
matters.
9.09 Licenses and Permits. The Managing Partner shall use all
commercially reasonable efforts to procure and maintain, for the
account of the Partnership, all licenses, permits and other
governmental authorizations necessary or appropriate to operate the
Partnership. The Managing Partner shall notify the Non-Managing
Partners promptly of any denial, suspension or revocation of any
material permit, license or governmental authorization and of any other
action or failure to act by any governmental authority which relates to
permits or licenses for the Partnership or significantly affects the
operations of the Partnership.
9.10 Litigation. The Managing Partner may, in its commercially
reasonable discretion, bring suit in the name or on behalf of the
Partnership without the approval of the Policy Committee. The Managing
Partner shall at all times keep the Non-Managing Partners informed of
the current status and all significant developments in any such suit.
9.11 Payment and Reimbursement of Expenses; Handling of
Partnership Bank Accounts and Funds.
(a) The Partnership shall establish bank accounts at such
banks as may from time to time be designated by the Managing
Partner. The Partnership's funds shall be invested in such manner
as the Managing Partner deems appropriate with interest accruing
to the Partnership. All bank and other accounts shall be
maintained in the Partnership's name. None of the Partnership's
funds shall be commingled with the funds of any Partner unless
previously approved in writing by all of the other Partners. The
Partnership shall designate a representative of the Managing
Partner as a signatory on its bank accounts to accomplish more
effectively the purposes of this Section 9.11.
(b) During the regular course of business, the Managing
Partner will invoice customers on behalf of the Partnership for
all sales of the business of the Partnership. The customers for
such sales will be instructed to direct their cash remittance
directly to a Partnership bank account designated by the Managing
Partner.
(c) The Partnership shall pay all costs, expenses,
liabilities, losses, damages, penalties and other obligations of
the Partnership. In furtherance thereof, the Managing Partner
will maintain in the name of the Partnership one or more
Partnership cash disbursement accounts for the purpose of paying
all such obligations of the Partnership. These disbursements
include all payments to third parties, payments to the Partners
for expenses incurred on behalf of the Partnership as well as
payments to the Partners of their share of Distributable Cash.
The disbursements shall cover all capital as well as operating
outlays of the Partnership.
(d) The Partnership shall pay to the Managing Partner, out
of Partnership funds, an annual fee (the "Administrative Fee")
intended to compensate the Managing Partner for selling and
administrative expenses (determined on a basis consistent with
Operations' historic practice with respect to its Contributed
Business) incurred by the Managing Partner in connection with the
operation and management of the business and affairs of the
Partnership or the performance of the Managing Partner's
obligations hereunder. One-twelfth of the Administrative Fee
shall be payable monthly in advance on the first day of each month
during the term of the Partnership. The Administrative Fee shall
initially be thirty-four million, three hundred thousand dollars
($34,300,000) and (i) shall be adjusted on June 30, 1994 and each
June 30 thereafter during the term of the Partnership in
accordance with the following sentence, and (ii) may be adjusted
by the Policy Committee upon the request of any Partner if the
manner in which the Managing Partner manages and operates the
business and affairs of the Partnership changes in such a way that
the Administrative Fee (as adjusted in accordance with the
following sentence) no longer accurately reflects the selling and
administrative practices employed by the Managing Partner in
connection with the operation and management of the business and
affairs of the Partnership and the performance of its obligations
hereunder. The Administrative Fee for any Fiscal Year commencing
with the Fiscal Year commencing July 1, 1994 shall be equal to
either (x) the sum of (i) the Administrative Fee in effect for the
immediately preceding Fiscal Year, plus (ii) the product of (A)
the percentage change in the GNP Deflator Index for the
immediately preceding Fiscal Year, multiplied by (B) the
Administrative Fee for the immediately preceding Fiscal Year or
(y) an amount determined by the Policy Committee pursuant to
clause (ii) of the immediately preceding sentence. It is agreed
among the Partners that all expenses and costs relating to FRP
Transferred Sales Employees are included in the Administrative Fee
and that no additional payment or reimbursement shall be made from
the Partnership to the Managing Partner on account of such
employees.
(e) The Partnership shall reimburse the Managing Partner
for all cash personnel costs, as set forth in Section 9.06.
Additionally, any other expenditures incurred by the Managing
Partner in connection with the business and affairs of the
Partnership or the performance by the Managing Partner of its
obligations hereunder in accordance with the terms of this
Agreement, as generally described in the operating budget of the
Partnership, and which constitute part of cost of goods sold and
not paid directly from Partnership funds will be reimbursed by the
Partnership.
(f) To the extent the Managing Partner determines that an
advance of monies from the Partners to the Partnership is
necessary (other than under the Working Capital Contribution
Arrangement), the Managing Partner shall request that the Policy
Committee call for cash contributions from the Partners in
accordance with Section 3.02(a).
(g) The Managing Partner shall be entitled to access, as
needed, the funds of the Partnership in order to pay expenses,
including, but not limited to, payroll expenses of the Managing
Partner, for which the Managing Partner is entitled to
reimbursement pursuant to Section 9.11(e).
(h) Notwithstanding anything herein to the contrary, the
Partnership shall not be obligated to pay, advance to or reimburse
the Managing Partner for, any costs or expenses pursuant to this
Section 9.11 if such cost or expense was incurred by the Managing
Partner otherwise than in compliance with this Agreement.
(i) All payments provided for in this Section 9.11 shall
be made on or before the due date, and if not paid, the unpaid
balance shall bear interest from and after the due date at the
rate equal to the lower of: (i) the maximum rate allowed by law
and (ii) the Prime Rate.
9.12 Transactions with Affiliates. Except with respect to items
(i)(B) and (ii) referred to in the parenthetical phrase in the
following sentence, any transaction, agreement, arrangement or
understanding between or on behalf of the Partnership, on the one hand,
and the Operating Partner or any Affiliate of the Operating Partner, on
the other hand, must be on terms no less favorable to the Partnership
than those which could be obtained from an independent third party
providing similar goods or services of like quality. All such
transactions, agreements, arrangements and understandings in an
aggregate amount in any Fiscal Year in excess of the Base Affiliate
Transaction Amount for such Fiscal Year (other than (i) during any
period during which the IMC Partner is Operating Partner, (A) any
transactions, agreements, arrangements or understandings with
Operations' railcar repair business located at Xxxxxxxxxx, Georgia on
terms no less favorable to the Partnership than those which could be
obtained from an independent third party providing similar goods or
services of like quality and (B) any transactions, agreements,
arrangements and understandings with the Rainbow Division of Operations
and International Minerals & Chemical (Canada) Global Limited
("IMC Canada Ltd."; formerly International Minerals & Chemical
Corporation (Canada) Limited) on the terms set forth on Schedule 9.12
and (ii) (A) the Marketing and Administrative Services Agreement, (B)
the Leasing Agreement, (C) the Materials Purchase and Cost Sharing
Agreement, (D) the Employee Cost Sharing Agreement and (E) the
Limestone Cost Sharing Agreement) shall be subject to the approval of
the Policy Committee or the CEOs, as the case may be, in accordance
with Section 6.07(a) or (b). Nothing in this Section 9.12 shall in any
way restrict or affect the right of the Partnership to enter into
transactions with Affiliates of the Non-Operating Partner.
The Operating Partner will, and will cause its Affiliates to (i)
give the Non-Operating Partner and its auditors and other authorized
representatives such access to the offices, properties, books and
records of such party, (ii) furnish to the Non-Operating Partner and
its auditors and other authorized representatives such financial and
operating data and other information as such Persons may reasonably
request and (iii) instruct its employees and auditors to cooperate with
the Non-Operating Partner and its auditors and other authorized
representatives, in each case as may be reasonably requested by the Non-
Operating Partner to evaluate any transactions, agreements,
arrangements or understandings between the Partnership or the Managing
Partner on the one hand, and the Operating Partner and its Affiliates,
on the other hand; provided that any investigation pursuant to this
Section shall be conducted in such a manner as not to interfere
unreasonably with the conduct of business of the Operating Partner and
its Affiliates.
9.13 No Shifting of Cash Flow. The Partners acknowledge that due
to the changes in the Partners' Current Interests and Capital Interests
over time, either the IMC Partner or the FRP Partner could be
disproportionately benefited or adversely affected by actions designed
to defer or accelerate Partnership revenues, defer or accelerate
Partnership expenses or capital expenditures or defer or accelerate
Partnership cash flow. The Managing Partner agrees that it will not
operate the Partnership with the intention of deferring or accelerating
cash flows from one period to another; provided that nothing in this
Section 9.13 shall prevent the Managing Partner from managing the
business and affairs of the Partnership in accordance with the then
current operating and capital expenditure budgets or taking actions to
serve the interests of the Partnership without regard to changes in the
Current Interests and Capital Interests of the Partners.
ARTICLE X.
Accounting Records; Tax Matters
10.01 Books and Records. The Managing Partner shall cause the
Partnership to prepare and maintain proper and complete records and
books of account, separate from the books and records of the Managing
Partner maintained for activities unrelated to the Partnership, in
which shall be entered all transactions and other matters relative to
the Partnership and the operation and management of the Partnership and
its business as are usually entered into records and books of account
maintained by Persons engaged in businesses of like character. The
books and records of the Partnership shall be maintained at its
principal place of business. The books of the Partnership shall be
maintained for financial reporting requirements in accordance with
generally accepted accounting principles. The Partnership shall also
maintain such tax basis books as are required for the Partnership and
the Partners to comply with the provisions of FASB 109. The
Partnership shall provide such financial and other statements,
including plans, forecasts and projections, as each Partner may
reasonably require for purposes of estimating taxes or projecting the
amount and source of future taxable income or loss.
10.02 Inspection of Books and Records. Each of the IMC Partner
(and, during the IMC GPCo Liquidation Period, each of Operations and
IMC GPCo) and the FRP Partner, at its own expense, shall have
reasonable access to the auditors of the Partnership and shall have the
right to inspect such books and records and the physical properties of
the Partnership during normal business hours and to cause an audit
thereof; provided that if either of the IMC Partner (or, during the IMC
GPCo liquidation Period, Operations or IMC GPCo) or the FRP Partner
requests access to the Partnership's auditors, desires to inspect the
books, records and physical properties of the Partnership or desires to
cause an audit of the Partnership's books, records and physical
properties, such Partner shall provide prior written notice to the
Managing Partner; and provided, further, that, unless required by
applicable law or unless such Partner reasonably believes that it needs
some or all of the information which would be obtained in an audit in
order to satisfy its duties and obligations to its shareholders or
partners or to the shareholders or to the partners or unitholders of
Global or FRP, as the case may be, no more than one such audit may be
requested during any twelve (12) month period and each such audit shall
be made, if at all, within twenty-four (24) months of the end of the
fiscal period to which it relates. All meetings with the Partnership's
auditors and inspections of the Partnership's books, records and
physical properties shall be conducted in a manner and at a time
designed not to cause undue inconvenience to the Managing Partner. The
Managing Partner, however, shall (i) not unreasonably delay such audit,
(ii) make all books and records of the Partnership available to the
auditors in connection with such audit and (iii) use all commercially
reasonable efforts to cause its personnel to cooperate with the
auditors in a commercially reasonable manner and to provide any
assistance reasonably necessary in connection with such audit. Any
Partner shall be permitted to make financial and other information
relating to the business and affairs of the Partnership available to
third parties in connection with any proposed sale or other disposition
of all or a portion of its Partnership Interest in accordance with the
terms of this Agreement, provided such third parties have signed
appropriate confidentiality agreements with such Partner and the
Partnership.
10.03 Accounting and Taxable Year. Subject to Section 448 of the
Code and the provisions of this Agreement, the books of the Partnership
(and the classification, realization and recognition of income, gain,
losses, deductions and other items for Federal income tax purposes)
shall be kept and determined on such method of accounting for tax and
financial reporting purposes as may be determined by the Managing
Partner. The taxable year of the Partnership shall end on such date
permitted under the Code as the Partners shall determine.
10.04 Partnership Tax Returns. The Managing Partner shall use
its best efforts to cause the Partnership to timely file all necessary
federal, state, and local Partnership income tax returns and
information returns. Each Partner shall provide such information, if
any, as may be required by the Partnership for purposes of preparing
such tax and information returns. The Partnership's income tax returns
shall be provided to the Non-Operating Partner in sufficient time for
the Non-Operating Partner to confer with the Managing Partner before
the time at which such Partnership return must be filed. The
Partnership shall deliver to each Partner, within twenty-five (25) days
after the end of the Partnership taxable year any additional
information in the possession of the Partnership that the Partners may
reasonably require for the preparation of their own income tax returns.
10.05 Partnership Taxes. The Managing Partner shall cause the
Partnership to timely pay all taxes and assessments levied or assessed
against the Partnership or its assets. However, the Managing Partner
may cause the Partnership to either (i) contest in good faith the
validity of any such taxes or assessments or (ii) pay such taxes and
assessments under protest. In the event that the Managing Partner
causes the Partnership to contest in good faith such taxes and
assessments, the Managing Partner shall not be obligated to cause the
Partnership to pay the same until a final determination is reached that
such taxes or assessments are valid and constitute an obligation of the
Partnership.
10.06 Tax Matters Partner. The Managing Partner shall be the
"tax matters partner," as that term is defined in Code Section
6231(a)(7) (the "Tax Matters Partner") with all of the rights, duties,
and powers provided for in Code Sections 6221 through 6232 inclusive;
provided, however, that, in the exercise of such powers, the Tax
Matters Partner shall be subject to the overall direction of the
Partners and the provisions of Sections 10.05, 10.06 and 10.07. The
Tax Matters Partner, as an authorized representative of the
Partnership, shall have the right to retain and to pay the fees and
expenses of counsel and other advisors selected by the Tax Matters
Partner. All reasonable expenses of the Tax Matters Partner and other
reasonable fees and expenses of the Partnership incurred in connection
with the defense of any claims made by the Internal Revenue Service
shall be borne by the Partnership.
10.07 Duties of the Tax Matters Partner. The Tax Matters Partner
shall cooperate with the other Partners and, for other than routine
correspondence and communications, shall promptly provide the other
Partners with copies of notices or other materials from, and inform the
other Partners of discussions engaged in with, the Internal Revenue
Service and shall provide the other Partners with notice of all
scheduled administrative proceedings, including meetings with Internal
Revenue Service agents, technical advice conferences and appellate
hearings, as soon as reasonably possible after receiving notice of the
scheduling of such proceedings. The Tax Matters Partner shall not
agree to extend the period of limitations for assessments, file a
petition or complaint in any court, file a request for an
administrative adjustment of Partnership items after any return has
been filed, or enter into any settlement agreement with the Internal
Revenue Service or Department of Treasury with respect to Partnership
items of income, gain, loss, deduction or credit except with the
consent of the IMC Partner (or, with respect to the IMC GPCo
Liquidation Period, Operations and IMC GPCo) and the FRP Partner, which
consent shall not be unreasonably withheld. The Tax Matters Partner
may request extensions to file any tax return or statement without the
consent of, but shall so inform, the IMC Partner (or, with respect to
the IMC GPCo Liquidation Period, Operations and IMC GPCo) and the FRP
Partner. The provisions of this Agreement regarding the Partnership's
tax returns shall survive the termination of the Partnership and the
transfer of any Partner's Partnership Interest and shall remain in
effect for the period of time necessary to resolve any and all matters
regarding the Federal, state and local income taxation of the
Partnership and the items of Partnership income, gain, loss, deduction
and credit.
10.08. Partnership Status; Elections.
(a) The Partners acknowledge that this Agreement creates a
partnership for Federal and state income tax purposes and hereby
agree not to elect to be excluded from the application of
Subchapter K of Chapter 1 of Subtitle A of the Code or any similar
state statute.
(b) The Managing Partner shall cause the Partnership to
file an election under Section 754 of the Code and the Treasury
Regulations thereunder to adjust the basis of the Partnership
assets under Sections 734(b) or 743(b) of the Code and shall file
a corresponding election under the applicable sections of state
and local law. The Managing Partner shall also cause the
Partnership to take or to elect to take deductions under the most
accelerated method available to the Partnership, unless both the
IMC Partner (or, with respect to the IMC GPCo Liquidation Period,
Operations and IMC GPCo) and the FRP Partner agree otherwise. The
Partnership shall make any other elections under the United States
income tax laws and regulations and any similar state statutes as
determined to be appropriate by the Managing Partner.
10.09. Tax Reporting.
(a) The Managing Partner shall provide the Non-Operating
Partner with any tax information and data reasonably requested by
the Non-Operating Partner, including information and data
requested for the purpose of allowing the Non-Operating Partner to
(i) allocate its Partnership tax items on a property-by-property
basis; and (ii) allocate FRP's portion of Partnership tax items to
any partner of FRP that purchases or sells its interest in FRP
during the year, pursuant to Section 706 of the Code and FRP's
accounting conventions for sales and purchases of FRP interests.
For purposes of this Section 10.09, the term "property" shall
mean, with respect to depletable assets, property as defined in
Section 613 of the Code and the Treasury Regulations thereunder.
(b) Except as otherwise provided in this Agreement, the
information and data requested pursuant to this Section 10.09
shall be provided to Non-Operating Partner on the following
schedule:
Period in Which Item Accrued Reporting Deadline
Fiscal Year ending June 30 October 25
Six Months ending December 31 January 25
(c) The information and data provided under this Section
10.09 shall be prepared with the same degree of completion and
accuracy as is required for information and data filed with a
Federal income tax return, shall be prepared on an accrual basis
and shall include any and all items of Partnership income, gain,
losses, deductions and any other items or information as may be
reasonably needed by the Non-Operating Partner or any of its
Affiliates. Such information and data shall include, but shall
not be limited to, the total amount of each of the tax items
listed in the attached Schedule Y and each Partner's allocable
share of each item.
(d) In the event of any amendment to the Code or the
issuance of any Treasury Regulation or pronouncement that affects
any of the Non-Operating Partner's Affiliate's reporting
requirements with respect to the partners, if applicable, of any
of the Affiliates of the Non-Operating Partner, the Partnership
shall furnish to the Non-Operating Partner any additional
information and data that is reasonably necessary for any of the
Non-Operating Partner's Affiliates to comply with such reporting
requirements.
(e) In the event that any information is needed from the
Non-Operating Partner in order for the Tax Matters Partner to
complete the required federal and state tax return, such
information will be provided by the Non-Operating Partner by
September 15.
10.10. Tax Oversight.
(a) The Non-Operating Partner shall have the right to
request any and all information and data from the Managing Partner
regarding the calculation of the allocations pursuant to Article V
and regarding the tax matters of the Partnership, including the
classification, realization and recognition of income, gain,
losses, deductions and other Partnership items, and the Operating
Partner shall provide such information and data as soon as
practicable. Each of the IMC Partner (or, with respect to the IMC
GPCo Liquidation Period, Operations and IMC GPCo) and the FRP
Partner, at its sole cost, shall also have the right to inspect
and copy any and all books and records of the Partnership relating
to the calculation and allocation of Partnership tax items,
including the original source documents and tax work papers of the
Partnership, at such times as the IMC Partner (or, with respect to
the IMC GPCo Liquidation Period, Operations or IMC GPCo) or the
FRP Partner, as the case may be, may reasonably request.
(b) The Managing Partner shall notify the Non-Operating
Partner as promptly as practicable of the tax treatment of any
significant tax item of the Partnership. The Non-Operating
Partner shall have the right to confer with the Managing Partner
regarding the tax matters of the Partnership and the calculation
of the allocations pursuant to Article V on a yearly basis or on a
more frequent basis as requested by the Non-Operating Partner.
(c) In the event of a disagreement between the Partners
regarding the treatment of a Partnership tax item (other than
items as to which the Partners approve a treatment), the
Partnership shall not take any position for Federal or state
income tax purposes that is not supported by substantial
authority, as that term is defined for purposes of Code Section
6662(d)(2)(B)(i). The Partners reserve the right to file their
separate income tax returns in a manner inconsistent with the
Partnership's Federal income tax return.
ARTICLE XI.
Term
11.01 Term. The term of the Partnership commenced on July 1,
1993 and shall continue in existence until June 30, 2076, unless
extended by written agreement of each Partner or unless earlier
terminated pursuant to the terms of this Agreement.
11.02 Purchase Option Upon Scheduled Expiration of the
Term. Either the IMC Partner or the FRP Partner may give the other
irrevocable written notice not less than one hundred eighty (180) days
prior to the scheduled expiration of the term of the Partnership
pursuant to Section 11.01 of its election to exercise the purchase
option set forth in this Section 11.02. If only one of the IMC Partner
or the FRP Partner gives the notice referred to in the preceding
sentence (the "Buying Partner"), the Buying Partner shall have the
right and the obligation to purchase all, but not less than all, of
such other Non-Managing Partner's Partnership Interest and the Managing
Partner's Partnership Interest at the aggregate Transfer Price
therefor. If the Buying Partner and such other Non-Managing Partner
cannot agree upon a Transfer Price within sixty (60) days after the
notice referred to in the first sentence of this Section 11.02, either
the IMC Partner or the FRP Partner may, by notice to the other, invoke
the Appraisal Procedure. If the Appraisal Procedure is required to
determine the Transfer Price, the fees and expenses of such Appraisal
Procedure shall be shared equally by the IMC Partner and the FRP
Partner. The closing of such sale shall take place upon the date the
term of the Partnership is scheduled to expire pursuant to Section
11.01. If both the IMC Partner and the FRP Partner give the notice
referred to in the first sentence of this Section 11.02, then the term
of the Partnership under Section 11.01 shall automatically be extended
for an additional period of twenty (20) years (or such other time
period as the IMC Partner and the FRP Partner may mutually agree) on
the terms and conditions set forth herein (or on such other terms and
conditions as the IMC Partner and the FRP Partner may mutually agree).
If neither the IMC Partner nor the FRP Partner give the notice referred
to in the first sentence of this Section 11.02, then, upon the
expiration of the term of the Partnership, the affairs of the
Partnership shall be wound up in accordance with the provisions of
Article XII hereof.
ARTICLE XII.
Dissolution and Winding-Up
12.01 Dissolution. The Partnership shall be dissolved upon the first
to occur of the following events (each, a "Dissolution Event"):
(a) The Bankruptcy of any Partner, provided, however, that
to the fullest extent permitted by applicable law, the Partnership
shall be reconstituted and continued if all of the Partners (other
than a Bankrupt Partner or Partners) elect to so reconstitute and
continue the Partnership, in which event the Partnership shall
continue as so reconstituted with all of the Partners (including
the Bankrupt Partner or Partners) remaining as partners in the
Partnership;
(b) The election by all Partners to dissolve the
Partnership;
(c) The expiration of the term of the Partnership (as such
term may be adjusted pursuant to Section 11.01 or 11.02), except
if one Partner acquires directly or indirectly the Partnership
Interest of the other Partners pursuant to the provisions of
Section 11.02;
(d) The occurrence of any event that makes it unlawful for
the business of the Partnership to be carried on or for the
Partners to carry it on in partnership;
(e) The entry of a decree of judicial dissolution;
(f) The written determination by the Policy Committee (or
if the Policy Committee fails to agree, if either the IMC Partner
or the FRP Partner reasonably and in good faith determines) that
the Partnership cannot be operated in a manner that is consistent
with achieving the Partnership's business purpose other than in a
manner that is inconsistent with preserving the partnership status
of the FRP Partner and FRP for Federal income tax purposes and the
election by either the IMC Partner or the FRP Partner to dissolve
the Partnership, after negotiating in good faith with the other
Partners, in accordance with Section 9.05(c); or
(g) Subject to Section 12.11, the occurrence of any other
event that, absent an agreement to the contrary, causes a
dissolution of the Partnership under the Act;
provided that, to the fullest extent permitted by law, if a dissolution
of the Partnership is caused by any event described in Section
12.01(g), unless one of the Partners is Bankrupt, (i) the Partners
(other than any Partner whose act has resulted in such dissolution) may
elect to reconstitute the Partnership within four (4) months of the
date of the event giving rise to the dissolution hereunder and if the
Partners do so elect, the Partnership shall continue as if no
dissolution had occurred, in which event the Partnership shall continue
as so reconstituted with all of the Partners (including any Partner the
act of which has resulted in such dissolution) remaining as partners in
the Partnership, or (ii) if the Partnership is not reconstituted as
provided above, and such dissolution is caused by the act of any
Partner (the "Withdrawing Partner"), then the IMC Partner, if it is not
the Withdrawing Partner or the FRP Partner, if it is not the
Withdrawing Partner (in either such case, the "Non-Withdrawing
Partner") may, by written notice to the Withdrawing Partner, elect (A)
to purchase the Partnership Interest of the Withdrawing Partner, or (B)
to admit one or more new partners (the "New Partners") to the
Partnership, who shall purchase the Partnership Interest of the
Withdrawing Partner or (C) to cause the Partnership's affairs to be
wound up in accordance with Section 12.02. The Withdrawing Partner (1)
shall have only those rights and receive only those payments that are
expressly provided for herein, (2) shall be liable to the Partnership,
the Non-Withdrawing Partner, the Managing Partner and any New Partners
for all losses, costs, fees, expenses and damages suffered by the
Partnership, such Non-Withdrawing Partner, the Managing Partner or any
New Partners as a result of such dissolution, (3) shall remain liable
to the Partnership, such Non-Withdrawing Partner, the Managing Partner
and any New Partners for any debts, liabilities or other obligations of
the Withdrawing Partner to the Partnership, such Non-Withdrawing
Partner, the Managing Partner or any New Partners, and (4) shall remain
liable to the Partnership, such Non-Withdrawing Partner, the Managing
Partner and any New Partners for its contribution obligation pursuant
to Section 8.02. The purchase price to be paid to the Withdrawing
Partner (by the Non-Withdrawing Partner or any New Partners) in any
sale and purchase of the Withdrawing Partner's Partnership Interest
pursuant to this Section 12.01, shall be (x) the Transfer Price,
determined (unless otherwise agreed) in accordance with the Appraisal
Procedure (which Appraisal Procedure shall be at the expense of the
Withdrawing Partner), reduced by (y) the amount of any losses, costs,
fees, expenses or damages suffered by the Partnership, the Non-
Withdrawing Partner, the Managing Partner or any New Partners as a
result of such dissolution, and shall be payable to the Withdrawing
Partner in five equal annual installments, without interest, commencing
on the date of the transfer of the Partnership Interest of the
Withdrawing Partner (which shall be the tenth (10th) business day
following the determination of the Transfer Price). In any winding up
pursuant to clause (ii)(C) above, the amount otherwise distributable to
the Withdrawing Partner pursuant to the following provisions of Article
XII shall be reduced by the amount of any losses, costs, fees, expenses
or damages suffered by the Partnership, the Non-Withdrawing Partner,
the Managing Partner or any New Partners as a result of such
dissolution.
12.02 Winding-Up. Upon dissolution of the Partnership, and the
failure by one or more of the Partners or any Affiliate or Affiliates
of the Partners, to reconstitute and continue the Partnership (pursuant
to Section 11.02 or otherwise) within four (4) months after such
dissolution and if the Non-Withdrawing Partner has not made any
election pursuant to Section 12.01, the Managing Partner shall (unless
the event giving rise to the dissolution was the Bankruptcy of the
Managing Partner, in which case the Non-Managing Partner with the
largest Capital Interest at the time of such dissolution shall) wind up
the affairs of the Partnership in accordance with the Act and, to the
extent permitted by applicable law, shall settle accounts between the
Partners as specified in this Article XII. The Partner charged with
winding up the affairs of the Partnership and settling accounts among
the Partners hereunder shall be referred to as the "Liquidating
Partner".
12.03 Accounting on Dissolution. If the Partnership is not
reconstituted or continued in accordance with the terms hereof
following a dissolution, then on the date (the "Accounting Date") which
is four (4) months following the date of dissolution, a proper
accounting shall be made of the Partnership assets, liabilities and
operations, from the date of the last previous accounting to the
Accounting Date. Any items of income, gain, credit, loss, expense and
other deductions which are realized subsequent to the date of the last
previous accounting to the Accounting Date shall be allocated in
accordance with Article V and proper adjustments shall be made to the
Capital Account of each Partner.
12.04 Accounting; Allocations of Residual Net Profits and
Residual Net Loss After Dissolutions.
(a) Any items of gain or loss that are realized from
Partnership operations or from sales of Partnership assets
subsequent to the Accounting Date and before the date of
liquidation shall be allocated as provided in Article V.
(b) In addition to the adjustments to the Partner's
Capital Accounts described above, if any of the Partnership's
properties are to be distributed in kind rather than sold, such
properties that are to be distributed in kind shall be valued by
the Partners and a simulated aggregate gain (if any) or loss (if
any) for those properties shall be allocated to the Partners'
Capital Accounts as that simulated aggregate gain (or loss) would
have been allocated under Article V if such properties had been
sold for a cash price equal to each asset's fair market value on
the Accounting Date.
12.05 Application of Article V in Year of Dissolution. In the
year in which the Partnership dissolves, Article V shall be applied
with regard to the Capital Interests in effect for the year of the
dissolution, rather than the Capital Interests in effect for the
following year.
12.06 Conversion of Assets to Cash.
(a) If the Partnership is not reconstituted, or the
Partnership Interest of the Withdrawing Partner is not purchased
in accordance with the terms hereof, then commencing with the date
that is four (4) months after the date of dissolution, unless
arrangements satisfactory to all Partners are otherwise made,
sufficient assets of the Partnership will be converted into cash
to permit the Partnership to pay all its liabilities other than
long-term debts which (i) are secured by Partnership assets from
which the projected net income is sufficient to pay installments
of principal and interest on such debts as they become due and
(ii) contain terms specifying that neither the dissolution of the
Partnership nor the distribution of such property that is subject
to and secured by such debts constitutes a default or causes the
acceleration of the maturity of such indebtedness ("Approved
Debts").
(b) Notwithstanding the provisions of Sections 12.07 and
12.08 regarding the method and timing of the liquidation of the
assets of the Partnership, but subject to the order of priorities
set forth therein, if on commencement of the winding up process in
accordance with Section 12.02, the Partners determine that an
immediate sale of part or all of the Partnership's assets would be
impractical or would cause undue loss to the Partners, the
Partners may defer for a reasonable time the liquidation of any
assets except those necessary to satisfy the liabilities of the
Partnership.
(c) In the event that Partnership assets are distributed
in kind pursuant to Section 12.06(b), the Partners shall be
consulted to determine the most tax-efficient manner to make such
distribution, consistent with the liquidation priorities of
Section 12.07.
12.07 Distributions in Liquidation. As soon as the actions
required by Sections 12.03, 12.04, 12.05 and 12.06 have been completed,
the Liquidating Partner shall cause the cash and assets of the
Partnership to be distributed in the following order:
(a) To creditors of the Partnership (other than Partners)
in payment of all liabilities of the Partnership (other than
Approved Debts) in the order of priority as provided by law. If
any liability is contingent or uncertain in amount, a reserve
equal to the maximum amount to which the Partnership could
reasonably be held liable will be established. Upon the payment
or other discharge of such liability, the amount remaining in such
reserve not needed, if any, will be distributed in accordance with
the remaining provisions of this Section 12.07.
(b) To the Partners in payment of all loans (including,
without limitation, any Partner Loans) and any interest thereon in
accordance with the amount owing to each Partner.
(c) To each Partner in accordance with the positive
balance in its Capital Account.
(d) To the Partners in accordance with their respective
Capital Interests in effect for the year of the liquidation.
(e) Notwithstanding the foregoing provisions of this
Section 12.07, any distribution which, but for this Section
12.07(e) would be payable to a Partner whose actions in violation
of this Agreement (other than any breach of Section 9.05(a))
caused the dissolution of the Partnership shall be reduced by the
amount of losses, costs, fees, expenses and damages suffered by
the Partnership or any Partner (other than the Partner whose
actions caused a dissolution) as a result of such dissolution.
12.08 Compliance with Treasury Regulations. In the event that
the Partnership or any Partner's Partnership Interest is "liquidated"
within the meaning of Treasury Regulation Section 1.704-1(b)(2)(ii)(g),
liquidating distributions shall be made, pursuant to this Agreement, in
accordance with the Partners' positive Capital Account balances, as
required by Treasury Regulation Section 1.704(b)(2)(b)(2), by the end
of the taxable year or, if later, within ninety (90) days after the
date of such liquidation. In determining any Partner's Capital Account
balance pursuant to this Section 12.08, any item of gain, loss,
deduction, and credit that has not previously been allocated pursuant
to Article V shall be so allocated.
12.09 Deficit Capital Account Restoration Obligation. At the end
of the period described in Sections 12.06 and 12.08 (and after
allocation of all Partnership items pursuant to this Article XII), if
any Partner has a negative balance in its Capital Account, such
negative balance shall be a debt from that Partner to the Partnership,
and that Partner shall be obligated to make additional contributions to
the Partnership to restore that Partner's Capital Account for income
tax purposes to zero (0) at such time. Any amount contributed to the
Partnership pursuant to this Section 12.09 shall be distributed
according to Section 12.07.
12.10 Section 708 Termination. Notwithstanding any other
provision of this Article XII, in the event that the Partnership is
liquidated within the meaning of Section 1.704-1(b)(2)(ii)(g) of the
Treasury Regulations, but no Dissolution Event has occurred, the assets
of the Partnership shall not be liquidated, the Partnership's
liabilities shall not be paid or discharged, and the Partnership's
affairs shall not be wound up.
12.11 Continuation of the Partnership. Unless required by
applicable law, no sale, transfer, assignment or other disposition by
either Partner of all or any part of its Partnership Interest in
accordance with the terms hereof (including, without limitation, the
transfers of the Partnership Interest of IMC GPCo to Operations in
connection with the IMC GPCo Liquidation and, in the event that FTX and
FRP choose to cause the merger, liquidation or dissolution of the FRP
Partner (or the transfer by the FRP Partner of its Partnership
Interests to FRP or an Affiliate of FRP) in accordance with the terms
of the Amendment, Waiver and Consent Agreement, transfers of the
Partnership Interest of the FRP Partner to FRP or an Affiliate of FRP
in connection with such merger, liquidation or dissolution of the FRP
Partner) shall cause a dissolution of the Partnership, and, if such a
dissolution is required under applicable law (including, without
limitation, as a result of the transfers of the Partnership Interest of
IMC GPCo to Operations in connection with the IMC GPCo Liquidation or,
in the event that FTX and FRP choose to cause the merger, liquidation
or dissolution of the FRP Partner (or the transfer by the FRP Partner
of its Partnership Interests to FRP or an Affiliate of FRP) in
accordance with the terms of the Amendment, Waiver and Consent
Agreement, as a result of the transfers of the Partnership Interest of
the FRP Partner to FRP or an Affiliate of FRP in connection with such
merger, liquidation or dissolution of the FRP Partner), immediately
upon such sale, transfer, assignment or other disposition by either
Partner, the Partnership shall be reconstituted as a general
partnership, governed by this Partnership Agreement, among the
transferee, purchaser or assignee and the remaining Partner or
Partners.
12.12 Waiver of Certain Rights. Unless otherwise agreed in
writing by the Partners, to the extent permitted by Delaware law, each
Partner hereby waives (i) all rights it may have under Delaware law to
cause the dissolution of the Partnership (other than dissolution by
operation of law as a result of a transfer of its Partnership Interest
as expressly permitted hereby), (ii) to the extent a dissolution occurs
by operation of law, the right to cause the Partnership to wind up its
affairs and make distributions to the Partners pursuant to Article XII
upon the occurrence of such dissolution and (iii) all rights to
partition with respect to real and personal property, provided that
this clause shall not apply to assets that have previously been
distributed by the Partnership to the Partners.
ARTICLE XIII.
Miscellaneous Provisions
13.01 Force Majeure. If the Managing Partner is rendered unable,
wholly or in part, by force majeure to carry out its obligations
hereunder such obligations insofar as they are affected by the force
majeure shall be suspended during but no longer than the continuance of
the force majeure. In such event, the Managing Partner shall use all
commercially reasonable efforts to remove the force majeure as promptly
as practicable. The term "force majeure" shall mean but shall not be
limited to: acts of God or the public enemy; expropriation or
confiscation of facilities; compliance with any order or request of any
governmental authority or person purporting to act therefor; acts of
declared or undeclared war; public disorders, rebellion, or sabotage;
revolution; earthquake; fire; flood; riot; labor difficulties or
shortages; labor strikes whether direct or indirect; action or inaction
of any governmental agencies; delays in or shortages of transportation;
inability to obtain necessary materials or equipment; inability to
obtain necessary permits or approvals due to existing or future laws,
rules or regulations of any governmental authority; or any cause
whether or not of the same class or kind as those specifically above
named not within the control of the Managing Partner and which, by the
exercise of all commercially reasonable efforts the Managing Partner is
unable to prevent. The requirement that the Managing Partner use all
commercially reasonable efforts to remedy any force majeure as promptly
as practicable shall not require the settlement of strikes, lockouts,
or other labor difficulties by the Managing Partner contrary to its
wishes or the challenging of the validity of any governmental law,
regulation, order or request. In the event of any occurrence of force
majeure, the Managing Partner immediately shall notify the Policy
Committee of such occurrence.
13.02 Limitation of Liability of Partners.
(a) Notwithstanding anything to the contrary set forth in
this Agreement, except as provided in Section 7.06 or Section
13.02(b), no Partner (which term, for purposes of this Section
13.02(a), shall, with respect to the IMC GPCo Liquidation Period
(and all other periods during which Operations or IMC GPCo is a
Partner), refer to each of Operations and IMC GPCo, severally and
not jointly) shall be liable to the Partnership, any other Partner
or any of their respective Related Persons for any loss or damage
of any nature incurred or suffered by the Partnership, any other
Partner or any of their respective Related Persons except loss or
damage to the Partnership, any other Partner or any of their
respective Related Persons caused by such Partner's gross
negligence or wilful misconduct hereunder.
(b) The Managing Partner shall be liable to the
Partnership and the other Partners, solely as a result of such
Partners' status as Partners, only for all damages, including lost
profits, which are proximately caused by the Managing Partner's
gross negligence, wilful misconduct, wilful breach of this
Agreement or failure to follow a specific instruction from the
Policy Committee adopted in accordance with the terms of this
Agreement, but shall not be so liable for any further lost profits
or other damages which are the further consequences of such lost
profits or other damages that were proximately caused. For
purposes of this Agreement, an ignoring of the terms of this
Agreement shall be deemed a wilful breach; provided that the
Managing Partner shall not be liable for ignoring the term of this
Agreement requiring the Managing Partner to act as an ordinary
prudent and reasonable manager if the Managing Partner acted in
good faith and in the belief (which belief was reasonable) that
its actions were in accordance with all of the terms of this
Agreement.
13.03 Assignment. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors
and assigns; provided that no assignment of any Partnership Interest,
or portion thereof, shall be effective unless made in accordance with
the terms of this Agreement. The transfers of the Partnership Interest
of IMC GPCo to Operations in connection with the IMC GPCo Liquidation,
the FRP GPCo/FCC/FTX Mergers and, in the event that FTX and FRP choose
to cause the merger, liquidation or dissolution of the FRP Partner (or
the transfer by the FRP Partner of its Partnership Interests to FRP or
an Affiliate of FRP) in accordance with the terms of the Amendment,
Waiver and Consent Agreement, transfers of the Partnership Interest of
the FRP Partner to FRP or an Affiliate of FRP in connection with such
merger, liquidation or dissolution of the FRP Partner shall each be
deemed to be made in accordance with the terms of this Agreement. The
sale, transfer or assignment of a Partnership Interest, or portion
thereof, in accordance with the terms of this Agreement (including,
without limitation, the transfers of the Partnership Interest of IMC
GPCo to Operations in connection with the IMC GPCo Liquidation and, in
the event that FTX and FRP choose to cause the merger, liquidation or
dissolution of the FRP Partner (or the transfer by the FRP Partner of
its Partnership Interests to FRP or an Affiliate of FRP) in accordance
with the terms of the Amendment, Waiver and Consent Agreement,
transfers of the Partnership Interest of the FRP Partner to FRP or an
Affiliate of FRP in connection with such merger, liquidation or
dissolution of the FRP Partner) shall result in the transfer to the
purchaser, transferee or assignee of a Partnership Interest, or portion
thereof, that is equal to the sold, transferred or assigned Partnership
Interest, or the sold, transferred or assigned portion thereof, of the
seller, transferor or assignor and shall cause the purchaser,
transferee or assignee to be subject to and to incur all obligations
pertaining to the sold, transferred or assigned Partnership Interest,
or the sold, transferred or assigned portion thereof.
13.04 Notices. All communications, notices and consents provided
for herein shall be in writing and be given in person (or air freight
delivery) or by means of telecopy (with request for assurance of
receipt in a manner typical with respect to communications of that
type) or by mail, and shall become effective (x) on delivery if given
in person or by air freight delivery, (y) on the date of transmission
if sent by telecopy or (z) three business days after being deposited in
the mails, with proper postage for first-class registered or certified
air mail prepaid. Notices shall be addressed as follows:
(i) if to the IMC Partner at:
0000 Xxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Facsimile: 000-000-0000
Attention: Corporate Secretary
(ii) if to Operations at:
0000 Xxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Facsimile: 000-000-0000
Attention: Corporate Secretary
(iii) if to IMC GPCo at:
0000 Xxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Facsimile: 000-000-0000
Attention: Corporate Secretary
(iv) if to the Managing Partner at:
0000 Xxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Facsimile: 000-000-0000
Attention: Corporate Secretary
and (v) if to the FRP Partner at:
0000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
Facsimile: 000-000-0000
Attention: General Counsel
or at such other address as either party hereto may from time to time
designate by notice duly given in accordance with the provisions of
this Section to the other party hereto.
13.05 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware without
regard to the conflicts of law rules of such state.
13.06 Choice of Forum. All suits, actions or proceedings arising
out of or relating to this Agreement shall be brought in a state or
federal court located in the State of Delaware, which courts shall be
an appropriate forum for all such suits, actions or proceedings. Each
Partner hereby waives any objection which it may now or hereafter have
to the laying of venue in any such court of any such suit, action or
proceeding.
13.07 Consent to Jurisdiction. Each Partner hereby irrevocably
submits to the jurisdiction of any state or federal court located in
the State of Delaware in any such suit, action or proceeding referred
to in Section 13.06 above. IMC GPCo hereby designates and appoints The
Corporation Trust Company, with an office on the date hereof at 0000
Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, or any successor thereof, as
its authorized agent to accept and acknowledge on its behalf service of
any and all process which may be served in any such suit, action or
proceeding in any state or federal court in the State of Delaware and
agrees that service of process upon The Corporation Trust Company, or
any successor thereof, shall be deemed in every respect effective
service of process upon IMC GPCo in any such suit, action or
proceeding. Operations hereby designates and appoints The Corporation
Trust Company, with an office on the date hereof at 0000 Xxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000, or any successor thereof, as its authorized
agent to accept and acknowledge on its behalf service of any and all
process which may be served in any such suit, action or proceeding in
any state or federal court in the State of Delaware and agrees that
service of process upon The Corporation Trust Company, or any successor
thereof, shall be deemed in every respect effective service of process
upon Operations in any such suit, action or proceeding. The FRP
Partner hereby designates and appoints The Corporation Trust Company,
with an office on the date hereof at 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxx 00000, or any successor thereof, as its authorized agent to
accept and acknowledge on its behalf service of any and all process
which may be served in any such suit, action or proceeding in any state
or federal court in the State of Delaware and agrees that service of
process upon The Corporation Trust Company, or any successor thereof,
shall be deemed in every respect effective service of process upon the
FRP Partner in any such suit, action or proceeding. The Managing
Partner hereby designates and appoints The Corporation Trust Company,
with an office on the date hereof at 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxx 00000, or any successor thereof, as its authorized agent to
accept and acknowledge on its behalf service of any and all process
which may be served in any such suit, action or proceeding in any state
or federal court in the State of Delaware and agrees that service of
process upon The Corporation Trust Company, or any successor thereof,
shall be deemed in every respect effective service of process upon the
Managing Partner in any such suit, action or proceeding. Said
designation and appointment by each of IMC GPCo, Operations, the FRP
Partner and the Managing Partner shall be irrevocable during the term
of this Agreement, and each party shall pay all costs and expenses of
its respective designation and appointment as and when due and payable.
13.08 Waiver of Jury Trial. EACH PARTNER HEREBY WAIVES ANY RIGHT
TO A TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT AND AGREES THAT ANY SUCH SUIT, ACTION OR
PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.
13.09 Entire Agreement; Amendments. This Agreement (including
the exhibits hereto) together with the other Transaction Agreements
(including any exhibits or schedules thereto), the Amendment, Waiver
and Consent Agreement and a certain letter agreement dated as of July
1, 1993 relating to certain tax matters between Operations and FRP
embody the entire agreement and understanding between the parties with
respect to the subject matter hereof and thereof, and supersede any
agreements, representations, warranties or understandings, oral or
written, between the parties with respect to the subject matter of this
Agreement and the other Transaction Agreements entered into prior to
the respective dates hereof and thereof. This Agreement may be amended
or modified (including, without limitation, to admit a new "Partner" or
"Partners" (other than (i) any New Partners or any new "Partner"
admitted to the Partnership pursuant to a transfer of the Partnership
Interest (or a portion thereof) of a Partner pursuant to Section 7.02
or Section 7.04) or (ii) the admission of FRP or an Affiliate of FRP as
a new Partner as a result of the election of FTX and FRP to merge,
liquidate or dissolve the FRP Partner (or transfer its Partnership
Interests) in accordance with the terms of the Amendment, Waiver and
Consent Agreement) only by an instrument in writing executed by all of
the Partners.
13.10 Execution in Counterparts. This Agreement may be signed in
counterparts. Any single counterpart or set of counterparts signed, in
either case, by all the parties hereto shall constitute a full and
original agreement for all purposes.
13.11 Remedies and Waiver. No failure or delay in exercising any
right hereunder shall operate as a waiver of or impair any such right.
No single or partial exercise of any such right shall preclude any
other or further exercise thereof or the exercise of any other right.
Any waiver must be given in writing to be effective, and no waiver
shall be deemed a waiver of any other right.
13.12 Headings. The headings of Articles and Sections have been
included herein for convenience only and shall not constitute a part of
this Agreement for any other purpose.
13.13 Third Party Beneficiaries. This Partnership Agreement is
solely for the benefit of the parties hereto and the Partners'
respective Related Persons to the extent set forth in Section 8.01, and
no provision of this Agreement shall be deemed to confer upon third
parties, other than the Partners' respective Related Persons to the
extent set forth in Section 8.01, any remedy, claim, liability,
reimbursement, claim of action or other right in excess of those
existing without reference to this Agreement.
13.14 Further Assurances. Each Partner agrees to execute and
deliver such other documents, certificates, agreements and other
writings and to take such other actions as may be necessary or
desirable in order to consummate or implement expeditiously the
transactions contemplated by the Transaction Agreements and to vest in
the Partnership good title to the Assets, subject only to Permitted
Liens.
13.15 Power of Attorney. Each Partner hereby constitutes and
reappoints, effective as of May 26, 1995, the Managing Partner and its
successors and assigns as the true and lawful attorney of such Partner
with full power of substitution in the name of the Partnership or in
the name of such Partner, but for the benefit of the Partnership (i) to
collect for the account of the Partnership any Asset and (ii) to
institute and prosecute all proceedings on behalf of the Partnership
which the Managing Partner may in its commercially reasonable
discretion deem necessary or appropriate in order to assert or enforce
any right, title or interest in, to or under the Assets, and to defend
or compromise any and all actions, suits or proceedings in respect of
such Assets. The Partnership shall be entitled to retain for its own
account any amounts collected pursuant to the foregoing powers,
including any amounts payable as interest in respect thereof.
13.16 Public Announcements. Except as may be required by
applicable law or any listing agreement with any national securities
exchange, neither the Partnership nor any Partner nor any Affiliate
thereof will issue any press release or make any public statement with
respect to the business of the Partnership or its financial performance
or condition without the prior written consent of the Partners unless
either (i) a draft of the proposed release has been provided to each
Partner at least twenty-four (24) hours prior to its proposed release
in order to permit the Partners to comment thereon or (ii) such press
release or other public statement contains factual information (or
discussion or analysis of or comment based upon such factual
information) previously provided to such Person by the Managing
Partner; provided that none of the Partners nor any of their Affiliates
will present projections or forward-looking information that is
attributed to the Partnership or any other Partner or its Affiliates
without the prior written consent of such other Partners.
* * * * *
IN WITNESS WHEREOF, the parties have signed this Amended and
Restated Partnership Agreement as of the 26th day of May, 1995.
IMC-Agrico GP Company
By: XXXXXX X. XXXXXXXXX
---------------------------------
Name Printed: Xxxxxx X. Xxxxxxxxx
Title: Vice President
Agrico, Limited Partnership
By: Agrico, Inc., its
general partner
By:
-------------------------------------
Name Printed:
Title:
IMC-Agrico MP, Inc.
By: XXXXXX X. XXXXXXXXX
--------------------------------
Name Printed: Xxxxxx X. Xxxxxxxxx
Title: Vice President
IMC Global Operations Inc.
(formerly IMC Fertilizer, Inc.)
By: XXXXX XXXX
--------------------------------
Name Printed: Xxxxx Xxxx
Title: Vice President
IN WITNESS WHEREOF, the parties have signed this Amended and
Restated Partnership Agreement as of the 26th day of May, 1995.
IMC-Agrico GP Company
By:
---------------------------------
Name Printed:
Title:
Agrico, Limited Partnership
By: Agrico, Inc., its
general partner
By: XXXXXXX X. XXXXXXXX
-------------------------------------
Name Printed: Xxxxxxx X. Xxxxxxxx
Title: Vice President
IMC-Agrico MP, Inc.
By:
--------------------------------
Name Printed:
Title:
IMC Global Operations Inc.
(formerly IMC Fertilizer, Inc.)
By:
--------------------------------
Name Printed:
Title:
Schedule X
B - (N x T)
---------------
Target Cash = C - N
B = The capital account balance of the respective
Partner at the beginning of the June 30 fiscal
year, adjusted for all adjustments to the
Partner's capital account for the current year
except for adjustments required as a result of
(i) allocations pursuant to Section 5.01; (ii)
the special allocations pursuant to Section
5.02(c) and 5.02(d); and (iii) all cash
distributions to the Partner for the current
fiscal year made pursuant to the Partner's
Current Interest for the year.
N = The Capital Interest for the following year
for the respective Partner. In determining
any allocations to be made pursuant to Article
V and Article XII for any period other than a
period ending on the last day of the
Partnership's fiscal year, however, the
Capital Interest for the current year for the
respective Partner shall be used.
T = The sum of the capital account balances of the
Partners at the beginning of the June 30
fiscal year, adjusted for all adjustments to
the Partners' capital accounts for the current
year except for adjustments required as a
result of (i) allocations pursuant to Section
5.01; (ii) the special allocations pursuant to
Section 5.02(c) and 5.02(d); and (iii) all
cash distributions to the Partners for the
current fiscal year made pursuant to the
Partners' Current Interest for the year.
C = The Current Interest of the respective Partner
for the applicable fiscal year.
SCHEDULE Y
ITEM OF TAX INFORMATION PERIOD(S) DATE
1. Ordinary income excluding July 1 - December 31 January 25
depreciation and depletion (estimated July 1 - June 30 October 25
where appropriate), including (final)
workpapers supporting allocations
between partners
2. Depletable gross revenues, statutory July 1 - December 31 January 25
depletion expenses (excluding July 1 - June 30 October 25
depreciation) for purposes of Code (final)
Section 613, production volumes, and
remaining reserves by property (taking
into account special tax allocations)
3. Depreciation and amortization expense, July 1 - December 31 January 25
by tax property for mining assets and by July 1 - June 30 October 25
state for other assets, as follows: (final)
---Federal
---AMT
---ACE
4. Depreciable and amortizable asset July 1 - December 31 January 25
additions and retirements, by tax July 1 - June 30 October 25
property for mining assets and by state (final)
for other assets
5. Leasehold cost basis and related July 1 - December 31 January 25
additions, retirements, and abandonments July 1 - June 30 October 25
by tax property (final)
6. Outstanding balance of recourse and Monthly (as of each January 25
nonrecourse debt month end October 25
July 31 - December 31
January 31 - June 30
7. Interest and dividend income July 1 - December 31 January 25
July 1 - June 30 October 25
(final)
8. Code Section 1231 gains or losses, and July 1 - December 31 January 25
ordinary income recapture July 1 - June 30 October 25
(final)
9. Reconciliation of book to taxable income July 1 - December 31 January 25
July 1 - June 30 October 25
(final)
10. Partnership gross income consisting of July 1 - December 31 January 25
qualifying income under Code Section January 1 - June 30 October 25
7704 (d) as well as nonqualifying income
11. Fair market value evaluation by Calendar year January 25
property
ITEM OF TAX INFORMATION PERIOD(S) DATE
12. Additional state tax information July 1 - June 30 October 25
A. Sales by state based on the place (final)
of origin and place of shipping
destination
B. Inventory by state
C. Miscellaneous income (i.e.,
interest, dividends, gains and
losses, rental income and other
miscellaneous income) by state
D. Rent expense
E. Book original cost of depreciable
and depletable assets by state,
considering the effect of
additions and retirements
F. Book basis information for the
Louisiana corporation franchise
tax return
13. Tax basis of all assets and As of December 31 January 25
liabilities, by major category, for Code As of June 30 (final) October 25
Section 743 and FAS 109 purposes
14. Depreciation and amortization, by tax July 1 - June 30 November
property, for mining assets for the (final) 25
following:
--Earnings and Profits
--State (where appropriate)
15. Estimate of permanent differences July 1 - December 31 January 6
between book and taxable income
16. Estimate of taxable income for FAS 109 July 1 - December 31 January 6
purposes
17. Estimated regular and AMT taxable July 1 - June 30 January 25
income
18. Any other tax information and data
reasonably requested by the
Non-Operating Partner or its Affiliates
for purposes of complying with their
federal and state tax reporting
requirements
Schedule 9.12
Sales to IMC Canada Ltd. of GTSP, DAP, GMAP 11-52-0, GMAP 10-50-0 and
PFS: the price shall be the average market price minus ten percent
(10%) for domestic sales of similar products so long as the aggregate
volume for the above-mentioned products does not exceed 57,619 P2O5
tons.
Sales to Operations' Rainbow Division of GTSP, DAP, RMAP, GMAP and PFS:
the price shall be the average market price minus ten percent (10%),
but not less than full production cost, for domestic sales of similar
products so long as the aggregate volume for the above-mentioned
products does not exceed 95,200 P205 tons.
EXHIBIT A
Schedule of Definitions
"Accounting Date" shall have the meaning given to such tern in
Section 12.03 of the Partnership Agreement.
Accounting Referee" shall have the meaning given to such term in
the Contribution Agreement.
"Acquiring Person shall have the meaning given to such term in
Section 2.08 (b) of the Partnership Agreement.
"Act" shall mean the Uniform Partnership Law as enacted in the
State of Delaware.
"Administrative Fee" shall have the meaning given to such term in
Section 9.11 of the Partnership Agreement.
"Affiliate" of any Person shall mean any corporation,
proprietorship, partnership or business entity which, directly of
indirectly, owns or controls, is under common ownership or control
with, or is owned or is controlled by, such Person.
"Affiliated Group" means a Person together with its affiliates and
all Persons who are members of a "group" with such Person within the
meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended.
"Agrico LP" or "FRP Partner" (in the case of "FRP Partner", prior
to the merger, liquidation or dissolution of the FRP Partner (or the
transfer by the FRP Partner of its Partnership Interests to FRP or an
Affiliate of FRP) contemplated by the Amendment, Waiver and Consent
Agreement) shall mean Agrico, Limited Partnership, a Delaware limited
partnership.
"Alternates" shall have the meaning given to such term in Section
6.04 of the Partnership Agreement.
"Amendment, Waiver and Consent Agreement" shall mean the Amendment,
Waiver and Consent Agreement dated as of May 26, 1995 among Global,
Operations, IMC GPCo, the Managing Partner, IMC-Agrico Company, FTX,
FRP and the FRP Partner.
"Appraisal Procedure" shall mean the following: If any price,
value, amount or determination to be determined under the Partnership
Agreement cannot timely be established by agreement, then either the
IMC Partner (or, as set forth in the Partnership Agreement, during the
IMC GPCo Liquidation Period, Operations or IMC GPCo) or the FRP
Partner, by written notice to the other, may invoke the Appraisal
Procedure. Each of the IMC Partner (or, during the IMC GPCo
Liquidation Period, Operations or IMC GPCo) and the FRP Partner shall
appoint its Qualified Investment Banking Firm to conduct an appropriate
valuation and shall give notice of such appointment to the other
Non-Managing Partner(s) within fifteen (15) days after delivery of the
notice invoking such procedure. If the IMC Partner (or, during the IMC
GPCo Liquidation Period, Operations or IMC GPCo) or the FRP Partner
does not appoint its Qualified Investment Banking Firm within such
fifteen (15) day period, the valuation made by the Qualified Investment
Banking Firm appointed by the other Non-Managing Partner shall be
conclusive and binding on the Partners. If within thirty (30) days
after appointment of the Qualified Investment Banking Firms, such
Qualified Investment Banking Firms are unable to agree upon an
appropriate valuation but the higher valuation is not greater than 110%
of the lower valuation, then the valuation which shall be binding on
the Partners shall be the average of the two (2) valuations given by
the Qualified Investment Banking Firms. If the higher valuation is
greater than 110% of the lower valuation, the two (2) Qualified
Investment Banking Firms jointly shall appoint a third Qualified
Investment Banking Firm within fifteen (15) days thereafter, or, if
they do not do so, either the IMC Partner (or, in such cases,
Operations or IMC GPCo) or the FRP Partner may request the American
Arbitration Association, or any organization successor thereto, to
appoint the third Qualified Investment Banking Firm. The decision of
the third Qualified Investment Banking Firm shall be given within sixty
(60) days after its appointment, shall be at least equal to the lower
valuation, shall not exceed the higher valuation and shall be binding
on the Partners.
"Approved Debts" shall have the meaning given to such term in
Section 12.06(a) of the Partnership Agreement.
"Asset Sale Amount" shall mean, with respect to any sale of any
Partnership asset other than in the ordinary course of business, an
amount equal to the greater of (a) the net book value of such asset as
shown on the most recent audited balance sheet of the Partnership and
(b) the net proceeds (including cash and the value of property
received) realized by the Partnership upon the sale or other
disposition of such asset.
"Assets" shall have the meaning given to such term in the
Contribution Agreement.
"Assumed Liabilities" and "Assumed Liability" shall have the
meanings given to such terms in the Contribution Agreement.
"Bankrupt" shall mean any Person with respect to which a Bankruptcy
shall have occurred.
"Bankruptcy" shall mean with respect to any Person the occurrence
of either of the following events"
(i) the Person shall commence a voluntary case or other
proceeding seeking liquidation, reorganization or other relief
with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator,
custodian or other similar official of it or any substantial part
of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an
involuntary case or other proceeding commenced against it, or
shall make a general assignment for the benefit of creditors, or
shall fail generally to pay its debts as they become due, or shall
take any corporate action to authorize any of the foregoing; or
(ii) an involuntary case or other proceeding shall be
commenced against the Person seeking liquidation, reorganization
or other relief with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or
other proceeding shall remain undismissed and unstayed for a
period of 60 days; or an order for relief shall be entered against
the Person under the federal bankruptcy laws as now or hereafter
in effect.
"Base Affiliate Transaction Amount" shall mean (i) for the Fiscal
Year ended June 30, 1994, five hundred thousand dollars ($500,000) and
(ii) for each subsequent Fiscal Year, an amount equal to the sum of (x)
the Base affiliate Transaction Amount in effect for the immediately
preceding Fiscal Year, plus (y) the product of (A) the percentage
increase in the GNP Deflator Index for the immediately preceding Fiscal
Year, multiplied by (B) the Base Affiliate Transaction Amount for the
immediately preceding Fiscal Year.
"Base Budget Amount" shall mean (i) for the Fiscal Year ended June
30, 1994, two hundred fifty thousand dollars ($250,000), and (ii) for
each subsequent Fiscal Year, an amount equal to the sum of (x) the Base
Budget Amount in effect for the immediately preceding Fiscal Year, plus
(y) the product of (A) the percentage increase in the GNP Deflator
Index for the immediately preceding Fiscal Year, multiplied by (B) the
Base Budget Amount for the immediately preceding Fiscal Year.
"Base Obligation Amount" shall mean (i) for the Fiscal Year ended
June 30, 1994, five million dollars ($5,000,000), and (ii) for each
subsequent Fiscal Year, an amount equal to the sum of (x) the Base
Obligation Amount in effect for the immediately preceding Fiscal Year,
plus (y) the product of (A) the percentage increase in the GNP Deflator
Index for the immediately preceding Fiscal Year, multiplied by (B) the
Base Obligation Amount for the immediately preceding Fiscal Year.
"Base Sale Amount" shall mean (i) for the Fiscal Year ended June
30, 1994, twenty-five million dollars ($25,000,000), and (ii) for each
subsequent Fiscal Year, an amount equal to the sum of (x) the Base Sale
Amount in effect for the immediately preceding Fiscal Year, plus (y)
the product of (A) the percentage increase in the GNP Deflator Index
for the immediately preceding Fiscal Year, multiplied by (B) the Base
Sale Amount for the immediately preceding Fiscal Year.
"Beneficial Interest" means with respect to either Ultimate Parent,
its beneficial ownership interest in the Partnership (determined upon
the basis of the Capital Interest of the Partner or Partners controlled
by such Ultimate Parent) proportionately reduced by any minority
ownership interest of any Person other than such Ultimate Parent or any
if its Intervening Persons in the Partner or Partners controlled by
such Ultimate Parent or any Intervening Person of such Ultimate Parent;
provided that in calculating the Beneficial Interest of FTX or any
subsequent Ultimate Parent of the FRP Partner, the beneficial ownership
interest of FTX or any subsequent Ultimate Parent of the FRP Partner in
the Partnership shall only be reduced on account of Non-Affiliated
Unitholders to the extent such Non-Affiliated Unitholders hold in
excess of 49% of the limited partnership interests of FRP.
"Capital Account" means, with respect to any Partner, the capital
account maintained for such Partner pursuant to Section 4.02 of the
Partnership Agreement.
"Capital Advance" shall have the meaning given to such term in
Section 3.02(b) of the Partnership Agreement.
"Capital Interest" shall have the meaning given to such term in
Section 4.01 of the Partnership Agreement.
"Capital Interest Cash" means, for any period any Capital Proceeds
received during such period less the sum of (A) Capital Proceeds
reinvested in a Capital Project during such period in accordance with
Section 5.07 of the Partnership Agreement plus (B) (i) expenditures for
Capital Projects during such period and (ii) capital expenditures in
any year for projects identified on Annex VII to the Contribution
Agreement, or alternative projects of a substantially similar nature
substituted by agreement of the parties, to the extent that the
aggregate amount of all such capital expenditures exceed 110% of the
aggregate amount shown on such Annex VII as being spent for such
projects in that year, which in both cases are either specifically
approved by the Policy Committee (or, if not by the Policy Committee,
by the CEOs or the Managing Partner in accordance with Section 6.07 of
the Partnership Agreement) or in a budget approved by the Policy
Committee(or, if not by the Policy Committee, by the CEOs or the
Managing Partner in accordance with Section 6.07 of the Partnership
Agreement). Furthermore, any expenditure that would otherwise be
subtracted pursuant to clause (B) of this definition of Capital
Interest Cash shall not be so subtracted to the extent that such
expenditure is funded by either the incurrence of indebtedness by the
Partnership or cash contributions by the Partners.
"Capital Proceeds" shall mean the cash proceeds of a Capital
Transaction received, whether the Capital Transaction occurred in the
current period or in a prior period.
"Capital Project" shall mean any project having an anticipated
useful life in excess of one year, with an anticipated cost (including
capitalized interest in connection with any Debt incurred to fund such
project) in excess of the Base Budget Amount and involving the
purchase, lease, license, acquisition, manufacture, maintenance or
construction of an asset, other than those items set forth on Annex VII
to the Contribution Agreement. A Capital Project shall be deemed
implemented or attributable to the Fiscal Year in which the relevant
asset is placed in service.
"Capital Transaction" shall mean the sale or disposition of any
asset of the Partnership having an anticipated useful life in excess of
one year other than in the ordinary course of business. A Capital
Transaction shall be deemed to have occurred in the Fiscal Year in
which the sale or disposition of the relevant asset becomes effective.
The sale of Big Bend or Port Xxxxxx terminal is not a Capital
Transaction.
"CEOs" shall have the meaning given to such term in Section 6.07(b)
of the Partnership Agreement.
"Claims" shall have the meaning given to such term in Section 8.01
of the Partnership Agreement.
"Closing" shall mean the consummation of the transactions
contemplated by the Contribution Agreement in accordance with Section
2.08 thereof.
"Closing Date" shall have the meaning given to such term in the
Contribution Agreement.
"Code" shall mean the Internal Revenue Code of 1986, as amended and
the regulations promulgated thereunder.
"Comparable Property" shall have the meaning given to such term in
Section 2.08(c) of the Partnership Agreement.
"Confidentiality Agreement" shall mean the Letter Agreement dated
November 18, 1992 among FRP, FTX and Group.
"Contributed Business" shall, with respect to Operations or FRP,
have the meaning given to such term in the Contribution Agreement.
"Contributing Partner" shall have the meaning given to such term in
Section 3.03 of the Partnership Agreement.
"Contribution Agreement" shall mean that certain Contribution
Agreement dated as of April 5, 1993 IMC and FRP
"Contribution Agreement Claim" shall have the meaning given to such
term in Section 5.07(d) of the Partnership Agreement.
"Cure Period" shall mean the period ending sixty (60) days after
the earlier to occur of (i) the agreement between the Non-Managing
Partners that a Material Breach has occurred and (ii) if a dispute
exists between the Non-Managing Partners as to whether a Material
Breach has occurred, a determination through the Dispute Resolution
Mechanism that a Material Breach has occurred; provided, that if during
the sixty (60) day period, the Operating Partner has promptly presented
to the Non-Operating Partner a remedy to cure such Material Breach and
has promptly begun and continuously pursued good faith efforts in
attempting to cure such Material Breach, then the Cure Period shall be
extended for so long as the Operating Partner is continuously pursuing
good faith efforts to cure such Material Breach, but in no event shall
the Cure Period be extended for more than a reasonable period of time,
taking into account the nature of the cure.
"Current Interest" shall have the meaning given to such term in
Section 4.01 of the Partnership Agreement.
"Current Interest Cash" shall mean, for any period the sum of
(i) the consolidated net income (or loss) of the
Partnership for such period;
plus (ii) the depreciation, depletion, amortization and all
other non-cash expenses of the Partnership, including the
amount of net book value eliminated as a result of any
asset sales made by the Partnership during such period;
plus (iii) the net cash proceeds with respect to any prior
period asset sales or liquidation of other non-current
assets of the Partnership received during the period to
the extent such proceeds are not already included in the
consolidated net income of the Partnership for such
period;
minus (iv) the non-cash proceeds of any asset sales made by
the Partnership during such period to the extent such
non-cash proceeds are included in the consolidated net
income of the Partnership for such period;
minus (v) the Partnership's earnings from non-consolidated
investees during such period;
plus (vi) the Partnership's share of losses in
non-consolidated investees during such period;
plus (vii) dividends and distributions of cash and cash
equivalents received by the Partnership from
non-consolidated investees during such period;
minus (viii) investments of cash and cash equivalents made by
the Partnership in non-consolidated investees during such
period;
minus (ix) capital expenditures (a) excluding expenditures for
Capital Projects but (b) including capital expenditures
for projects identified in Annex VII to the Contribution
Agreement but only to the extend that the aggregate among
of such expenditures in any year for projects identified
in Annex VII, or alternative projects of a substantially
similar nature substituted by agreement of the parties,
does not exceed 110% of the aggregate amount shown on
such Annex VII as being spent for such projects in that
year;
minus (x) t the extent not previously deducted in computing
the consolidated net income (or loss) of the Partnership,
expenditures of the Partnership relating to the shut down
of facilities and reclamation of land during such period
and other payments in respect of previously accrued
liabilities;
minus (xi) principal repayments of Partnership indebtedness;
minus (xii) Capital Proceeds of the Partnership during such
period;
minus (xiii) increases in cash reserves of the Partnership;
plus (xiv) decreases in cash reserves of the Partnership;
plus (xv) after consideration of noncash accruals and related
expenditures identified in (ii) and (x) above, decreases
in working capital loans from third parties at the end of
the period.
In calculating Current Interest Cash, to the extend applicable, each
item involved in the calculation shall be determined using the
financial statements of the Partnership prepared in accordance with
generally accepted accounting principles. Furthermore, any expenditure
that would otherwise be deducted pursuant to this definition of Current
Interest Cash shall not be deducted from consolidated net income to the
extent that such expenditure is funded by either the incurrence of
indebtedness by the Partnership or cash contributions by the Partners.
"Debt" shall mean, as to any Person: (a) indebtedness created,
issued or incurred by such Person for borrowed money (whether by loan
or the issuance and sale of debt securities; (b) obligations of such
Person to pay the deferred purchase or acquisition price of property or
services, other than trade or other accounts payable (other than for
borrowed money) arising, and accrued expenses incurred, in the ordinary
course of business so long as such trade or other accounts payable are
payable within ninety (90) days of the date the respective goods are
delivered or respective services rendered; )c) Debt of others secured
by a Lien on the property of such Person, whether or not the respective
indebtedness so secured has been assumed by such Person; (d)
obligations of such Person in respect of letters of credit or similar
instruments issued or accepted by banks and other financial
institutions for the account of such Person; (e) capital lease
obligations of such Person required to be reported as such in
accordance with generally accepted accounting principles from time to
time in effect; and (f) Debt of others guaranteed by such Person.
"Delaware Law" shall have the meaning given to such term in the
Partnership Agreement and in the Parent Agreement.
"Developing Partner" shall have the meaning given to such term in
Section 2.08(c) of the Partnership Agreement.
"Dispute Resolution Mechanism" shall mean a proceeding for
resolution of disputes, submitted to Endispute Incorporated
("Endispute:) in San Francisco, California, with the Non-Managing
Partner whose position is substantially upheld by Endispute in such
proceeding being entitled to recover its attorneys' fees and expenses
from the other Non-Managing Partner. If at the time that the dispute
occurs Endispute is not in the business of resolving disputes in San
Francisco, California, the Non-Managing Partners shall ask the Chief
Judge of the United States Court of Appeals for the Ninth Circuit to
select a similar firm located in San Francisco, California.
"Dissolution Event" shall have the meaning given to such term in
Section 12.01 of the Partnership Agreement.
"Distributable Cash" shall mean, with respect to any Partner for
any period, the sum of (i) Current Interest Cash for such period
multiplied by such Partner's Current Interest as of the last day of
such period, plus (ii) Capital Interest Cash for such period multiplied
by such Partner's Capital Interest as of the last day of such period,
except that the Capital Proceeds from a Capital Transaction occurring
in a prior period will be calculated using the Capital Interest in
effect as of the last day of the period in which the Capital
Transaction which generated such Capital Proceeds was deemed to have
occurred.
"Electing Partner" shall have the meaning given to such term in
Section 2.08(c) of the Partnership Agreement.
"Employee Cost Sharing Agreement" shall mean that certain Employee
Cost Sharing Agreement dated as of July 1, 1993 between IMC and the
Managing Partner.
"Environmental Liabilities" shall have the meaning given to such
term in the Contribution Agreement.
"Equivalent Sale Price" means the Triggering Event Partnership
Value, multiplied by the Capital Interest of the Non-Triggering Partner
immediately prior to the Triggering Event.
"Excluded Liability" shall have the meaning given to such term in
the Contribution Agreement.
"Exercise Notice" has the meaning given to such term in Section
7.04 of the Partnership Agreement.
"Exercising Partner" shall have the meaning given to such term in
Section 2.08(b) of the Partnership Agreement.
"Expansion" shall mean: (i) the construction or development of a
new mine, plant, building, structure or other facility for the purpose
of developing a new source of production capacity; (ii) any
construction, development, process improvement or other improvement
primarily designed to increase the production capacity or decrease the
cost structure of any existing mine, plant or facility; or (iii) any
purchases of materials related to the items in (i) or (ii).
"FASB 109" shall mean the Financial Accounting Standards Board
Statement of Financial Accounting Standard No. 109.
"FCC" shall mean Freeport Chemical Company, a Delaware corporation.
"Final IMC GPCo Liquidating Distribution" shall have the meaning
given to such term in the Partnership Agreement and in the Parent
Agreement.
"Fiscal Year" shall mean the twelve month period ending June 30th
for each year during the life of the Partnership or such other month
period as may be defined as the Fiscal Year of the Partnership pursuant
to Section 9.01 of the Partnership Agreement.
"FRP" shall mean Freeport-McMoRan Resource partners, Limited
Partnership, a Delaware limited partnership and its successors.
"FRP Alternate" and "FRP Alternates" shall have the meanings given
to such terms in Section 6.04 of the Partnership Agreement.
"FRP GPCo" shall have the meaning given to such term in the Parent
Agreement.
"FRP GPCo/FCC/FTX Merger Documents" shall have the meaning given to
such term in the Amendment, Consent Waiver Agreement.
"FRP GPCo/FCC/FTX Mergers" shall have the meaning given to such
term in the Partnership Agreement and in the Parent Agreement.
"FRP Partner" shall mean (i) Agrico, Limited Partnership, a
Delaware limited partnership, or (ii) FRP or the Affiliate of FRP that
succeeds to the obligations, assets, properties, rights and interests
of Agrico, Limited Partnership, as a result of the merger, liquidation
or dissolution of Agrico, Limited Partnership (or to which the
Partnership Interests of Agrico, Limited Partnership is transferred) as
contemplated by the Amendment, Waiver and Consent Agreement or (iii)
any other Affiliate of FRP which succeeds to the Partnership Interests
of the entity identified in (i) or (ii) above by means of the purchase,
transfer, assignment or other conveyance or succession of such
Partnership Interests in accordance with the terms of the Partnership
Agreement.
"FRP Representative" and FRP Representatives" shall have the
meanings given to such terms in Section 6.04 of the Partnership
Agreement.
"FRP Transferred Sales Employee" shall have the meaning given to
such term in the Contribution Agreement.
"FTX" shall mean Freeport-McMoRan Inc., a Delaware corporation and
its successors.
"FTX Common Shares" shall have the meaning given to such term in
the Parent Agreement.
"GNP Deflator Index" shall mean the GNP deflator index (final) as
published by the U.S. Department of Commerce (commencing with the index
as of June 30, 1993).
"Global" or "Group" shall mean IMC Global Inc. (formerly IMC
Fertilizer Group, Inc.), a Delaware corporation and its successors.
"Group Structure" shall have the meaning given to such term in the
Parent Agreement.
"IMC" or "Operations" shall mean IMC Global Operations Inc.
(formerly IMC Fertilizer, Inc.), a Delaware corporation and its
successors.
"IMC Alternate" and "IMC Alternates" shall have the meanings given
to such terms in Section 6.04 of the Partnership Agreement.
"IMC Common Shares" shall have the meaning given to such term in
the Parent Agreement.
"IMC GPCo" shall mean IMC-Agrico GP Company, a Delaware
corporation.
"IMC GPCo Liquidation" shall have the meaning given to such term in
the Parent Agreement.
"IMC GPCo Liquidation Period" shall have the meaning given to that
term in Article I of the Partnership Agreement.
"IMC GPCo Plan of Liquidation" shall mean the Agreement and Plan of
Complete Liquidation and Dissolution among Operations, IMC GPCo and
MPCo.
"IMC Partner" shall, with respect to each such Agreement, have the
meaning given to such term in the Parent Agreement and the Partnership
Agreement, respectively.
"IMC Plans" shall have the meaning given to such term in Section
9.06 of the Partnership Agreement.
"IMC Representative" and "IMC Representatives" shall have the
meanings given to such terms in Section 6.04 of the Partnership
Agreement.
"Initial IMC GPCo Liquidating Distribution" shall have the meaning
given to such term in the Partnership Agreement and the Parent
Agreement.
"Intervening Person" of either Ultimate Parent means a Person that
is controlled by such Ultimate Parent and which has an ownership
interest in either the IMC Partner or the FRP Partner, as the case may
be, or in another Intervening Person of such Ultimate Parent.
"Leased IMC Employees" shall have the meaning given to such term in
the Contribution Agreement.
"Leasing Agreement" shall have the meaning given to such term in
the Contribution Agreement.
"Lien" shall mean, with respect to any asset, and mortgage, lien,
pledge, charge, security interest, easement, right of way, title defect
or encumbrance of any kind with respect to such asset.
"Limestone Cost Sharing Agreement" shall mean that certain
Limestone Cost Sharing Agreement dated as of July 1, 1993, among IMC,
the Managing Partner and the Partnership.
"Liquidating Partner" shall have the meaning given to such term in
Section 12.02 of the Partnership Agreement.
"Major Decision" shall have the meaning given to such term in
Section 6.07 of the Partnership Agreement.
"Managing Partner" shall mean MPCo in its capacity as Managing
Partner under the Partnership Agreement.
"Marketing and Administrative Services Agreement" shall have the
meaning given to such term in the Contribution Agreement.
"Material Asset Sale" shall mean the sale or other disposition of
any asset of the Partnership other than in the ordinary course of
business, if, as a result of such sale, the aggregate Asset Sale Amount
for all such sales other than in the ordinary course of business
consummated in the Fiscal Year of such sale would exceed the Base Sale
Amount for such Fiscal Year.
"Material Breach" shall mean the occurrence of either of the
following events" (i) a material failure by the Managing Partner to
perform its duties or responsibilities as Managing Partner under this
Agreement of (ii) the Bankruptcy of the Operating Partner or any of its
direct or indirect parent entities.
"Material Breach Event" shall mean either:
(a) (i) the occurrence of a Material Breach referred to in
clause (i) of the definition of "Material Breach", (ii) the giving
of written notice of such Material Breach by the Non-Operating
Partner to the Operating Partner and (iii) the failure to cure
such Material Breach during the Cure Period;
(b) the occurrence of a Material Breach referred to in clause
(ii) of the definition of "Material Breach" and, if such Material
Breach results from a Bankruptcy referred to in clause (i) of the
definition of "Bankruptcy", the continuance of such Material
Breach for sixty (60) days; or
(c) the occurrence of an event that would have constituted a
Triggering Event but for the proviso in the definition of
"Triggering Event."
A "cure" of a Material Breach referred to in clause (i) of the
definition of "Material Breach" includes, without limitation,
reimbursement of the Partnership for any costs, expenses, liabilities,
obligations, losses, damages or penalties caused by such Material
Breach.
"Material Facility" shall mean any facility of the Partnership
having a book value, as shown on the latest quarterly balance sheet of
the Partnership, in excess of five percent (5%) of the net property,
plant and equipment of the Partnership, as shown on the latest
quarterly balance sheet of the Partnership, at the time of such
determination.
"Material Obligation" shall mean any liability or obligation
(known to the Managing Partner at the time of incurrence or assumption)
incurred or assumed by or on behalf of the Partnership for Expansion
and other than in the ordinary course of business in an aggregate
amount, based on the knowledge of the Managing Partner at the time of
such incurrence or assumption, in excess of the Base Obligation Amount
in effect at the time such liability or obligation is incurred or
assumed.
"Material Purchase and Cost Sharing Agreement" shall mean that
certain Material Purchase and Cost Sharing Agreement dated as of July
1, 1993 between IMC and the Partnership.
"MP Benefit Plans" shall have the meaning given to such term in
the Contribution Agreement.
"MB Contribution Plans" shall have the meaning given to such term
in the Contribution Agreement.
"MB Pension Plans" shall have the meaning given to such term in
the Contribution Agreement.
"MPCo" shall mean IMC-Agrico MP, Inc., a Delaware corporation and
its successors.
"Negotiating Interval" shall have the meaning given to such term
in the Parent Agreement.
"Negotiation period" shall have the meaning given to such term in
Section 7.02(b) of the Partnership Agreement.
"New Partners" shall have the meaning given to such term in
Section 12.01 of the Partnership Agreement.
"Non-Affiliated Unitholders" means limited partners of FRP other
than FTX and its Affiliates.
"Non-Contributing Partner" shall have the meaning given to such
term in Section 3.03 of the Partnership Agreement.
"Non-Contributing Partner's Share" shall have the meaning given to
such term in Section 3.03 of the Partnership Agreement.
"Non-Defaulting Partner" shall have the meaning given to such term
in Section 5.07(d) of the Partnership Agreement.
"Non-Developing partner" shall have the meaning given to such term
in Section 2.08(c) of the Partnership Agreement.
"Non-Managing Partner shall mean any Partner other than the
Managing Partner.
"Non-Operating Partner" shall have the meaning given to such term
in Section 2.06 of the Partnership Agreement.
"Non-Presenting Partner" shall have the meaning given to such term
in Section 2.08(b) of the Partnership Agreement.
"Non-Qualifying Income" shall mean any income other than
Qualifying Income.
"Non-Triggering Partner" means (i) if the IMC Partner is the
Triggering Partner, the FRP Partner and (ii) if the FRP Partner is the
Triggering Partner, the IMC Partner (which, during the IMC GPCo
Liquidation period, shall mean both Operations and IMC GPCo).
"Non-Withdrawing Partner" shall have the meaning given to such
term in Section 12.01 of the Partnership Agreement.
"No-Shop Period" shall have the meaning given to such term in
Section 7.02(b) of the Partnership Agreement.
"No-Shop Interval" shall have the meaning given to such term in
Section 3.0(d) of the Parent Agreement.
"Notice of Intent to Sell" shall have the meaning given to such
term in Section 7.02(b) of the Partnership Agreement.
"Notice of Intent to Transfer" shall have the meaning given to
such term in Section 3.0(d) of the Parent Agreement.
"Notified Partner" shall have the meaning given to such term in
Section 7.02(b) of the Partnership Agreement.
"Notified Person" shall have the meaning given to such term in
Section 3.0(d) of the Parent Agreement.
"Operating Partner" shall have the meaning given to such term in
Section 2.06 of the Partnership Agreement.
"Operations" or "IMC" shall mean IMC Global Operations Inc.
(formerly IMC Fertilizer, Inc.), a Delaware corporation and its
successors.
"Parent Agreement" shall mean the Parent Agreement among IMC, FRP
and the Partnership, as amended and restated as of May 26, 1995, and as
thereafter amended, modified or supplemented from time to time.
"Partner" or "Partners" shall have the meanings given to such
terms in Article I to the Partnership Agreement.
"Partner Loan" shall have the meaning given to such term in
Section 3.03 of the Partnership Agreement.
"Partnership" shall mean IMC-Agrico Company, a Delaware general
partnership formed pursuant to the Partnership Agreement.
"Partnership Agreement" shall mean the Partnership Agreement
between Operations, IMC GPCo, FRP and the Managing Partner, as amended
and restated as of July 1, 1993 and as further amended and restated as
of May 26, 1995 and as thereafter amended, modified or supplemented
from time to time.
"Partnership Interests" shall mean all right, title and interest
of a Partner in the Partnership, including, without limitation, its
Current Interest and Capital Interest.
"Partnership Units" shall have the meaning given to such term in
the Parent Agreement.
"Partnership Working Capital Facility" shall have the meaning
given to such term in Section 3.02(b) of the Partnership Agreement.
"Permitted Liens" shall have the meaning given to such term in the
Contribution Agreement.
"Person" shall mean an individual, a partnership, a corporation, a
trust, an unincorporated organization, a governmental authority and any
other entity.
"PhosChem" shall have the meaning given to such term in Section
2.03 of the Partnership Agreement.
"Phosphate Chemicals Business" means and includes (i) the
exploration for, and the acquisition, leasing, development, mining and
disposition of, phosphate rock reserves, (ii) engaging in contract
mining, tolling, processing, management and other activities regarding
the phosphate-related reserves, properties, facilities or materials of
third parties, (iii) the processing, manufacture, purchase, exchange
and sale of phosphate fertilizers and other phosphate chemicals
(including, without limitation, monoammonium phosphate, diammonium
phosphate, triple superphosphate and phosphoric acid) and related raw
materials and by-products (including, without limitation, the purchase
and use of sulphur, but excluding the manufacture, production, exchange
or sale of sulphur), (iv) the processing, manufacture, purchase,
exchange and sale of nitrogen chemicals (including anhydrous ammonia
and urea), (v) the extraction and recovery from phosphate rock and the
exchange and sale of uranium oxide, (vi) the management and operation
of agricultural, farming and livestock businesses as an incidental
activity relating to holding lands originally acquired or leased by the
Partnership or one of the Partners as phosphate rock reserves; (vii)
the acquisition, construction, ownership, leasing, operation,
management, alteration and disposition of real property (and interests
therein) and mining, manufacturing, mixing, granulation, processing,
refining, shipping and other equipment and facilities (including,
without limitation, motor vehicles, railroads, railcars, pipelines,
storage facilities, ports and vessels) related to any of the foregoing,
(viii) developing, subdividing, construction roads, sewers, utility,
water, sewage and water treatment and other facilities on, constructing
and selling, leasing or managing residential, commercial and other
improvements on, and otherwise dealing with, reclaimed and other land
originally acquired or leased as phosphate rock reserves, and (ix) all
other business and activities related or incidental thereto.
Notwithstanding the foregoing, "Phosphate Chemicals Business" shall not
include (i) the animal feeds business or (ii) the mixed fertilizer
business.
"PhosRock" shall have the meaning given to such term in Section
2.03 of the Partnership Agreement.
"Policy Committee" shall have the meaning given to such term in
Section 6.04 of the Partnership Agreement.
"Presenting Partner" shall have the meaning given to such term in
Section 2.08(b) of the Partnership Agreement.
"Prime Rate" shall mean the rate publicly announced from time to
time by Citibank, N.A. in New York City as its prime rate.
"Purchasing Partner" shall have the meaning given to such term in
Section 7.04 of the Partnership Agreement.
"Qualified Appraiser" shall mean an MIA appraiser which has been
appraising property in the county in which the real property to be
valued is located for at least the preceding five (5) years.
"Qualified Investment Banking Firm" shall mean in investment
banking firm of national and international reputation.
"Qualifying Income" shall have the same meaning as the term
"qualifying income" defined in Section 7704(d) of the Code and any
successor provision.
"Real Estate Appraisal Procedure" shall mean the following: If
the value of any real property to be determined under the Partnership
Agreement cannot timely be established by agreement, then either the
IMC Partner or the FRP Partner, by written notice to the other, may
invoke the process described below. Each of the IMC Partner and the
FRP Partner shall appoint its Qualified Appraiser to conduct an
appropriate valuation and shall give notice of such appointment to the
other Non-Managing Partner within fifteen (15) days after delivery of
the notice invoking such procedure. If either the IMC Partner or the
FRP Partner does not appoint its Qualified Appraiser within such
fifteen (15) day period, the valuation made by the Qualified Appraiser
appointed by the other Non-Managing Partner shall be conclusive and
binding on the Partners. If within thirty (30) days after appointment
of the Qualified Appraisers, such Qualified Appraisers are unable to
agree upon an appropriate valuation but the higher valuation is not
greater than 110% of the lower valuation, then the valuation which
shall be binding on the Partners shall be the average of the two (2)
valuations given by the Qualified Appraisers. If the higher valuation
is greater than 110% of the lower valuation, the two (2) Qualified
Appraisers jointly shall appoint a third Qualified Appraiser within
fifteen (15) days thereafter, or, if they do not do so, either the IMC
partner or the FRP Partner may request MIA, or any organization
successor thereto, to appoint the third Qualified Appraiser. The
decision of the third Qualified Appraiser shall be given within sixty
(60) days after its appointment, shall be at least equal to the lower
valuation, shall not exceed the higher valuation and shall be binding
on the Partners.
"Real Estate Development Project" shall mean any project involving
the developing, subdividing, construction roads, sewers, utility,
water, sewage and water treatment and other facilities on, construction
and selling, leasing or managing residential, commercial and other
improvements on, and otherwise dealing with, the land of the
Partnership.
"Related Persons" shall have the meaning given to such term in
Section 8.01 of the Partnership Agreement.
"Representatives" shall have the meaning given to such term in
Section 6.04 of the Partnership Agreement.
"Residual Net Loss" for any period, means the excess of all items
of expense over all items of income determined in accordance with the
principles set forth in Section 4.02(c) of the Partnership Agreement,
as computed and adjusted for allocations pursuant to Section 5.02 of
the Partnership Agreement.
"Retained Environmental Liability" shall have the meaning given to
such term in Section 6.08 of the Partnership Agreement.
"Retaining Partner" shall have the meaning given to such term in
Section 6.08 of the Partnership Agreement.
"SEC" shall mean the Securities and Exchange Commission of the
United States of America or any successor agency.
"Soliciting Partner" shall have the meaning given to such term in
Section 7.02(b) of the Partnership Agreement.
"Soliciting Person" shall have the meaning given to such term in
the Parent Agreement.
"Special Purpose Partner" shall mean any IMC Partner or FRP
Partner (i) the principal business purpose of which is the ownership of
its Partnership Interests in the Partnership and (ii) in respect of
which its Partnership Interests in the Partnership constitute
substantially all of its assets; provided, however, that (a) neither
Operations nor FRP shall constitute a "Special Purpose Partner" unless
Operations or FRP (x) acquires a Partnership Interest (or portion
thereof) and (y) its ownership interest in all of its other business
assets or operations constitutes a less than 5% portion of its total
assets or operations, and (b) each of IMC GPCo and Agrico, Limited
Partnership, as constituted as of May 26, 1995, would have constituted
a "Special Purpose Partner" as of such date. Notwithstanding the
foregoing, no entity that, as of the date such entity would have become
a Special Purpose Partner pursuant to the foregoing definition, has
outstanding securities registered under Section 12 of the Securities
Exchange Act of 1934, as amended (or any similar or successor provision
or statute), shall be a Special Purpose Partner.
"Subject Interest" shall have the meaning given to such term in
the Parent Agreement.
"Subject Partnership Interest" shall have the meaning given to
such term in Section 7.02(b) of the Partnership Agreement.
"Target Cash" for any year means the aggregate amount of Current
Interest Cash that would have been required for that year, when
distributed in accordance with the provisions of Sections 5.06 and 5.07
of the Partnership Agreement, to cause the ending balances in the
Partners' Capital Accounts, immediately prior to the allocations
provided in Sections 5.01, 5.02(c) and 5.02(d) of the Partnership
Agreement, to be in the same ratio as the Capital Interest percentages
for the following year. The calculation of Target Cash is illustrated
by the formula attached to the Partnership Agreement as Schedule X.
"Tax Matters Partner" shall have the meaning given to such term in
Section 10.06 of the Partnership Agreement.
"Transaction Agreements" shall mean collectively, the Contribution
Agreement, the Partnership Agreement, the Parent Agreement and the
Confidentiality Agreement.
"Transaction Costs" shall mean, collectively, (i) all documentary
stamp taxes, transfer taxes excise taxes and other similar taxes
imposed in connection with the transactions contemplated by the
Transaction Agreements by any state or other jurisdiction, including,
without limitation, the State of Florida or the State of Louisiana,
(ii) severance costs relating to the termination of employment of
FRP's, FTX's and IMC's operating personnel to the extent such
termination is directly attributable to the transactions contemplated
by the Transaction Agreements, (iii) severance costs, not to exceed an
aggregate of $12,600,000, relating to the termination of FRP's and
FTX's marketing and administrative personnel to the extent such
termination is directly attributable to the transactions contemplated
by the Transaction Agreements and (iv) severance costs, not to exceed
an aggregate of $1,000,000, relating to the termination of IMC's
marketing and administrative personnel to the extent such termination
is directly attributable to the transactions contemplated by the
Transaction Agreements.
"Transfer" shall have the meaning given to such term in Section
7.02(a) of the Partnership Agreement.
"Transfer Price" means (A) in the case of a sale resulting from a
Triggering Event described in clauses (ii) or (iv) of the definition
thereof, the fair market value of the Partnership Interest that is the
subject of such sale, as mutually determined by the IMC Partner and the
FRP Partner or, if no such fair market value is agreed upon within
thirty (30) days of the receipt by the Triggering Partner of the
Exercise Notice by the Non-Triggering Partner, by the Appraisal
Procedure; (b) in the case of a sale resulting from a Triggering Event
described in clauses (i) or (iii) of the definition thereof, (I) if the
transaction giving rise to the Triggering Event involved the sale of
all or a portion of the Partnership Interest of the Triggering Partner,
the Equivalent Sale Price and (II) if the transaction giving rise to
the Triggering Event was the sale of an ownership interest in the IMC
Partner or the FRP Partner or a Person controlling or under common
control with the IMC Partner or the FRP Partner, the fair market value
of the Non-Triggering Partner's Partnership Interest taking into
account the structure of the transaction which gave rise to the
Triggering Event, as mutually determined by the IMC Partner and the FRP
Partner or, if no such fair market value is agreed upon within thirty
(30) days of the receipt by the Triggering Partner of the Exercise
Notice, by the Appraisal Procedure; and(C) in all other cases, the fair
market value of the Partnership Interest (or portion thereof) to be
sold or transferred in accordance with the terms of the Partnership
Agreement as determined by the mutual agreement of the Partners, or, if
the Partners fail to agree upon such fair market value within the time
period set forth in the Partnership Agreement, determined in accordance
with the Appraisal Procedure.
"Triggering Event" means any of the following events:
(i) at any time that the IMC Partner is the Operating
Partner, the occurrence of a transaction which, after giving
effect thereto, results in the Ultimate Parent of the IMC Partner
owning less than a 35% Beneficial Interest in the Partnership;
(ii) at any time that the IMC Partner is the Operating
Partner, the occurrence of a transaction which, after giving
effect thereto, results in 65% or more of the issued and
outstanding voting stock of the Ultimate Parent of the IMC Partner
being owned by an Affiliated Group;
(iii) at any time that the FRP Partner is the Operating
Partner, the occurrence of a transaction which results in the
Ultimate Parent of the FRP Partner owning less than a 35%
Beneficial Interest in the Partnership; or
(iv) at any time that the FRP Partner is the Operating
Partner, the occurrence of a transaction which results in 65% or
more of the issued and outstanding stock of the Ultimate Parent of
the FRP Partner being owned by an Affiliated Group;
provided that none of the circumstances described in clauses (i)
through (iv) above arising out of the foreclosure of a Lien covering
the Partnership Interest of the IMC Partner (or, during the IMC GPCo
Liquidation Period, Operations or IMC GPCo) or the FRP Partner, the
capital stock or partnership interests, as the case may be, of the IMC
partner (or, during the IMC GPCo Liquidation Period, Operations or IMC
GPCo) or the FRP Partner of the capital stock or partnership interests
of any Intervening Person shall constitute a "Triggering Event."
"Triggering Event Notice" shall have the meaning given to such
term in Section 7.04 of the Partnership Agreement.
"Triggering Event Partnership Value" means an amount equal to the
purchase price paid to the Triggering Partner by the Purchasing Partner
in the transaction giving rise to the Triggering Event, divided by the
portion of the Capital Interest of the Triggering Partner sold in such
transaction.
"Triggering Partner" means (A) in the case of a Triggering Event
described in clauses (i) or (ii) of the definition thereof, the IMC
Partner and (B) in the case of a Triggering Event described in clauses
(iii) or (iv) or the definition thereof, the FRP Partner.
"Ultimate Parent" means (i) with respect to the IMC Partner, (A)
initially, Global, and (B) if at any time a Triggering Event occurred
without a Triggering Event Notice having been delivered, the Affiliated
Group that acquired 65% or more of the stock of Group or the Person
that is then the Ultimate Parent of the IMC Partner and (ii) with
respect to the FRP Partner, (A) initially, FTX and (B) if at any time a
Triggering Event referred to in clause (iv) of the definition thereof
shall have occurred without a Triggering Event Notice having been
delivered, the Affiliated Group that acquired 65% or more of the stock
of FTX or the Person that is then the Ultimate Parent of the FRP
Partner.
"Withdrawing Partner" shall have the meaning given to such term in
Section 12.01 of the Partnership Agreement.
"Working Capital Contribution Arrangement" shall have the meaning
given to such term in Section 3.02(b) of the Partnership Agreement.
