EXHIBIT 10.18
LIMITED PARTNERSHIP AGREEMENT
OF
CAC IV LIMITED PARTNERSHIP
This LIMITED PARTNERSHIP AGREEMENT (the "Partnership Agreement") is made as
of June 7, 2001 by and between CAC IV Special General, Inc., a Virginia
corporation, the general partner ("General Partner"), and CAC IV Special
Limited, Inc., a Virginia corporation, the limited partner ("Limited Partner").
INTRODUCTION
A. The General Partner and the Limited Partner (collectively, the
"Partners") have formed a limited partnership (the "Partnership") pursuant to
the provisions of the Virginia Revised Uniform Limited Partnership Act (the
"Act"), effective June 7, 2001. The General Partner and the Limited Partner are
each wholly-owned subsidiaries of Cornerstone Acquisition Company, a Virginia
corporation.
B. The rights, duties and obligations of the Partners shall be governed by
the Act except as otherwise provided in this Partnership Agreement. The term
"Person," as used herein, means an individual or an entity.
C. The Partnership is being formed as a single asset entity with a limited
purpose, as set forth below, in connection with a Xxxxxx Xxx loan to be secured
by the property owned by the Partnership.
ARTICLE I
ORGANIZATIONAL MATTERS
1.1 Name. The name of the Partnership is CAC IV Limited Partnership. The
Partnership may trade or transact business under such other names as may be
selected by the General Partner.
1.2 Purpose. Notwithstanding any provision hereof to the contrary, the
business, operations and purposes of the Partnership are limited solely to the
following:
(a) To own, operate, manage, transfer, lease, mortgage, pledge and
otherwise deal with that certain parcel of real property listed on Exhibit A
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hereto, together with all improvements located thereon (the "Property"); and
(b) To exercise all powers that are enumerated in the Act and that are
necessary or convenient for the business or purposes of the Partnership as set
forth herein.
1.3 Filings.
(a) The Partnership has filed a certificate of limited partnership with
the State Corporation Commission of Virginia pursuant to Section 50-73.11 of the
Code of Virginia (the "Certificate").
(b) The Certificate designates 000 Xxxx Xxxx Xxxxxx, Xxxxxxxx, Xxxxxxxx
00000 as the office where records of the Partnership are kept (the "Principal
Office"). The Certificate designates Xxxxxx X. Xxxxxxxx, Esquire, as the
registered agent at the following registered office: c/o McGuireWoods LLP, One
Xxxxx Center, 000 Xxxx Xxxx Xxxxxx, Xxxxxxxx, Xxxxxxxx 00000.
ARTICLE II
MANAGEMENT
2.1 The General Partner. The General Partner shall have the sole and
exclusive right, duty and power to manage the business of the Partnership,
including, without limitation, the right and power to:
(a) acquire, hold, sell, maintain, encumber, improve, develop or lease
the Partnership's property, whether real or personal, and any interest therein
on such terms and conditions as the General Partner deems advisable.
(b) borrow money on behalf of the Partnership, secure any such
borrowings with assets of the Partnership, and repay the same at any time or
from time to time;
(c) establish investment accounts for the Partnership and deposit and
withdraw funds in or from such accounts;
(d) assign, compromise or release any claim of, or debt due to, the
Partnership;
(e) institute and defend actions at law or in equity on behalf of the
Partnership and consent to arbitrate any disputes or controversies of the
Partnership;
(f) engage and retain accountants, lawyers and other professionals to
perform services for the Partnership, and purchase such goods and other services
as may be required to conduct the business of the Partnership; and
(g) enter into such contracts and perform such other acts as may be
necessary to further the business of the Partnership.
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ARTICLE III
LIMITED PARTNERS
3.1 Participation in Management. The Limited Partner shall not participate
in the management or control of the business of the Partnership, and shall have
no power to sign for or bind the Partnership.
ARTICLE IV
CAPITAL; PROFITS AND LOSSES; DISTRIBUTIONS
4.1 Capital Contributions. Each of the Partners has contributed to the
capital of the Partnership the property set forth on Exhibit B hereto. The
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Partners shall not be required to make any additional capital contributions
except as required by law, but the Partners may make such additional
contributions of cash or property as they may mutually agree. No Partner shall
have any right to require the return of all or any part of its capital, or to
receive interest with respect thereto.
4.2 Capital Accounts. A separate capital account ("Capital Account") shall
be maintained for each Partner. The value of each Capital Account shall be the
sum of the cash contributions to the account, the agreed upon value of
contributions of property to the account and the share of Partnership profits
allocated to the account, less all distributions made from the account and the
share of Partnership losses allocated to the account.
4.3 Profits and Losses. The net profits and net losses of the Partnership
for any period (except for the profits and losses upon dissolution) shall be
credited or charged to the Capital Accounts of the Partners in the percentages
set forth on Exhibit B under the heading "Partners Percentages," as the same may
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be amended from time to time (the "Partners Percentages").
4.4 Distributions. Any cash which, in the opinion of the General Partner,
is not reasonably required for the operation of the business of the Partnership
or for Partnership reserves (other than amounts distributed upon dissolution)
shall be distributed to the Partners in accordance with the Partners Percentages
not less frequently than each calendar quarter. Other distributions of assets
may be made form time to time in the same manner.
4.5 Loans. A loan by a Partner to the Partnership shall not be considered a
capital contribution and shall be repaid as debt of the Partnership.
ARTICLE V
INDEMNIFICATION
5.1 Requirement. The Partnership shall indemnify each Partner, and each
director and officer of a Partner (an "Indemnified Person"), against any and all
liabilities and expenses (including but not limited to reasonable legal fees and
costs) arising directly or indirectly from
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any action, suit or proceeding, whether civil, criminal, administrative,
arbitrative or investigative, and whether formal or informal, that is brought or
threatened against an Indemnified Person solely because such Indemnified Person
served as a Partner or as a director or officer of a Partner, or served at the
request of the Partnership as a fiduciary for an employee benefit plan or other
plan related to the business of the Partnership. Notwithstanding the foregoing,
the Partnership shall not be required to indemnify a Partner, or a director or
officer of a Partner, against any liabilities or expenses arising from any
breach of this Partnership Agreement, willful misconduct or knowing violation of
law.
5.2 Related Actions. The Partnership shall promptly make advances or
reimbursements for reasonable expenses (including but not limited to reasonable
legal fees and costs) incurred by a Partner, or a director or officer of a
Partner, claiming indemnification under this Article unless it has been
determined that such Partner, director or officer is not entitled to
indemnification. Advances or reimbursements made prior to such determination
shall be conditioned upon the Partnership's receipt of a written undertaking by
the Partner, director or officer claiming indemnification to repay the amount of
such advances or reimbursements if it is ultimately determined that such
Partner, director or officer is not entitled to indemnification.
ARTICLE VI
EVENTS OF DISSOLUTION
6.1 Events of Dissolution. The Partnership shall only be dissolved:
(a) upon the election of the General Partner;
(b) at such time as there is no General Partner serving unless, within
ninety (90) days, the Limited Partner consents to continue the business of the
Partnership and appoints one or more General Partners;
(c) upon automatic cancellation of the certificate of limited
partnership for failure to pay annual registration fees, unless steps are taken
promptly to obtain reinstatement; or
(d) by judicial decree.
ARTICLE VII
DISSOLUTION, WINDING UP AND TERMINATION
7.1 General. Upon dissolution without continuation, the business of the
Partnership shall be wound up by the General Partner or, if there is no General
Partner, by a representative designated by the Limited Partner (either of which
or whom is hereinafter referred to as the "Liquidating Representative"). The
Liquidating Representative shall proceed with reasonable promptness to liquidate
the business and assets of the Partnership and may determine whether, and to
which Partners, properties should be distributed in kind. Partnership assets
shall be distributed in the following order:
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(a) to creditors of the Partnership, including Partners who are
creditors, in the order of priority provided by law or contract;
(b) to the creation of such reserves for contingencies as the
Liquidating Representative may deem necessary or advisable;
(c) to the Limited Partner to the extent of its contribution to
capital;
(d) to the General Partner to the extent of its contribution to
capital;
(e) to the Partners, General and Limited, according to their Capital
Account balances, after all adjustments.
ARTICLE VIII
MISCELLANEOUS
8.1 Books of Account and Records. The Partnership shall keep complete books
of account at the Principal Office and such books shall be open to examination
by the Partners and the authorized representatives of each of them during normal
business hours. The books shall be kept on a cash or accrual basis, as
determined by the General Partner.
8.2 Tax Compliance. Notwithstanding anything to the contrary contained in
this Partnership Agreement, all actions taken in the conduct of the business of
the Partnership, or on its dissolution, shall comply with the provisions of
Section 704 of the Internal Revenue Code of 1986, as amended (the "Code"), and
the Regulations thereunder. The General Partner shall be the "Tax Matters
Partner" required by the Code.
8.3 Power of Attorney. The Limited Partner hereby appoints the General
Partner as its attorney-in-fact, or agent, to execute, acknowledge, deliver and
file in its name any document required by law to be filed by the Partnership or
the Limited Partner with any governmental body or agency. Any such appointment
is a special power, coupled with an interest, and shall remain in effect as long
as the Partner granting it has any interest in the Partnership or remains
responsible for any obligations under this Partnership Agreement.
8.4 Counterparts. This Partnership Agreement may be executed in
counterparts, each of which shall be deemed an original but which together shall
constitute one and the same instrument.
8.5 Amendments. This Partnership Agreement may be amended only with the
written consent of the General Partner and the Limited Partner.
8.6 Third Parties; Successors and Assigns. The agreements contained herein
are for the benefit of the parties hereto and their permitted successors and
assigns and are not for the benefit of any third parties, such as, without
limitation, creditors of the Partnership.
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8.7 Headings. The section headings in this Partnership Agreement are
included for convenience only and shall not affect the interpretation of this
Partnership Agreement.
8.8 Interpretation. This Partnership Agreement is executed and delivered in
the Commonwealth of Virginia and shall be construed and enforced in accordance
with its laws, without regard to any choice of law rules to the contrary.
WITNESS the following signatures:
GENERAL PARTNER: CAC IV Special General, Inc.
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By: /s/ Xxxxxxx X. Xxxxxxx, Xx.
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Xxxxxxx X. Xxxxxxx, Xx.,
Vice President
LIMITED PARTNER: CAC IV Special Limited, Inc.
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By: /s/ Xxxxxxx X. Xxxxxxx, Xx.
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Xxxxxxx X. Xxxxxxx, Xx.,
Vice President
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EXHIBIT A
(Property)
The Property consist of the real property, together with all improvements
thereon, that is located at the following address:
Xxxxxx Xxxx Apartments
0000 Xxxxxx Xxxx Xxxx
Xxxxxxxxx, Xxxxx 00000
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EXHIBIT B
(Capital Contributions)
Name and Capital Partners
Business Address Contributions Percentages
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General Partner: CAC IV Special General, Inc. $ 1.00 1%
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Limited Partner: CAC IV Special Limited, Inc. $99.00 99%
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
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