Exhibit 4(p)
SECOND ADDENDUM TO AGREEMENT OF PURCHASE AND SALE BETWEEN ROYAL PALM BEACH
COLONY LIMITED PARTNERSHIP
SUCCESSOR IN INTEREST TO ROYAL PALM BEACH UTILITIES COMPANY, AND
THE VILLAGE OF ROYAL PALM BEACH
THIS ADDENDUM made and entered into this 25th day of October, 2002, by and
between the XXXXXXX XX XXXXX XXXX XXXXX, XXXXXXX, a municipal corporation with
offices located at 0000 Xxxxx Xxxx Xxxxx Xxxxxxxxx, Xxxxx Xxxx Xxxxx, Xxxxxxx
00000 organized and existing in accordance with the laws of the State of Florida
(hereafter the "Village") ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP, a
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Delaware limited partnership authorized to do business in the State of Florida
with offices at 0000 X. Xxxxx Xxxxx, Xxxxxxxxx, Xxxxxxx 00000 (hereafter
"Colony"), successor in interest to Royal Palm Beach Utilities Company, formerly
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a Florida corporation ("Utility"), and Xxxxx Management Company, Inc., a
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Delaware corporation and the Managing General Partner of Colony ("Steinco") with
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offices x/x Xxxxx X. Xxxxxxx, Xxx. at 0 Xxxxxxxxxx Xxxxx, Xxxxxxxxxx, XX 000000
R E C I T A L S
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(A) Utilities and the Village executed the Agreement of Purchase and Sale on
March 30, 1983 (the "Agreement"), pursuant to which, among other matters, the
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Village purchased the Utility System described therein and agreed, in addition
to a cash payment at closing, to make additional annual payments (the
"Contingent Amount") based (1) on the rate of additional Equivalent Year
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Connections (defined as "Additional ERC's") and (2) on a percentage of
"Guaranteed Revenues" (as defined therein) each with respect to 18 annual
periods commencing on the Closing Date provided therein; and accordingly, the
Closing Date having taken place on August 11, 1983, the original last date with
respect to which payments were due based on the original Agreement was August
11, 2001.
(B) By virtue of certain governmental moratoriums or water usage cutbacks or
restrictions (collectively, for convenience, "Moratoriums") the original 18 year
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period was extended to March 11, 2004 by the First Addendum to the Agreement and
is hereby extended to August 11, 2004, the maximum term allowed under the
Agreement;
(C) Annual installments on the Contingent Amount (the "Contingent Payments") are
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required to be made on January 15 of each year (each, an "Annual Accounting
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Date") with respect to Additional ERC's and Guaranteed Revenues during the
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Village's fiscal year ending on August 31 of the immediately preceding year; and
Colony agrees (subject to audit with respect to the year ended August 31, 2001)
that it has received all such payments due to it in respect of all such fiscal
years through the fiscal year ended August 31, 2001.
(D) In consequence of the foregoing it is anticipated that three additional
Contingent Payments from the Village will be required in respect of the fiscal
years ending August 31 of 2002, 2003 and 2004, such Contingent Payments to be
made on the related Accounting Dates (January 15 of 2003, 2004 and 2005).
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(E) Colony was organized for the express purpose of liquidating its real estate
and related assets and distributing the net proceeds thereof to its limited and
general partners (collectively the "Partners"), and it has recently disposed of
the last of such assets, as a result of which Colony now holds only cash, cash
items and the right to receive the Contingent Payments hereafter, (as owned by
Colony, the "Contingent Receivables").
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(F) The Board of Directors of Steinco has determined that it would be in the
best interests of all of the Partners that Colony distribute to its Partners the
balance of its assets, consisting of cash, and cash items and the Contingent
Receivables, and immediately cause the liquidation and dissolution of Colony
(hereafter the "Liquidation"), all as originally contemplated in the Agreement
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of Limited Partnership of Colony (the "Partnership Agreement").
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(G) The Board of Directors of Steinco has further determined, in connection with
the Liquidation, that the most efficient and economical manner in which to
distribute interests in the Contingent Receivables would be to enter into this
Addendum, pursuant to which the Village, for the consideration stated below,
will distribute such amounts, if any, as become due as Contingent Payments to
the Paying Agent described in Section 4 below for further distribution to the
Partners.
(H) For the foregoing purposes the parties desire to enter into this Addendum to
set forth the manner in which the distribution of such Contingent Receivables
will be accomplished.
NOW, THEREFORE, in consideration of the premises and the considerations
stated in this Addendum, the parties agree as follows:
1. Assignment of Contingent Receivable to Partners on Liquidation Date
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(a) Assignment of Undivided Interests. As of the Liquidation Date (as
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hereafter defined), the Partnership, pursuant to a Plan of Liquidation and
Dissolution (Liquidation Plan"), will assign to each partner of record ("Record
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Holder"), as conclusively established by a list of such record owners
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established by the Partnership as of the Liquidation Date ("Record List") a
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non-transferable and undivided interest in each Contingent Payment due or
thereafter become due from the Village to Colony pursuant to the Agreement, as
modified by the First Addendum to the Agreement and this Second Addendum to the
Agreement, and which is actually made by the Village in accordance with the
procedures set forth in Section 2 below. The amount of such undivided interest
assigned to each Record Holder shall be equal to such partner's Percentage
Interest of each such Contingent Payment. (Such undivided interests are
hereafter referred to as the "Contingent Receivable Interests.") As used herein
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and in the Liquidation Plan, the term "Percentage Interest" as applicable to
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each Record Holder means a fraction, the numerator of which is the number of
Partnership interests held by a Record Holder as of the Liquidation Date and the
denominator of which is the aggregate number of units held by all partners of
the Partnership (4,485,504 Units).
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(b) Village Recognition of Assignments. Subject to the Partnership's
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compliance with the terms of this Addendum, the Village agrees to recognize and
hereby authorizes and approves such assignments.
(c) Record List. The Record List shall set forth the full name, address and
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Percentage Interest of each Record Holder as of the Liquidation Date and shall
be delivered to the Village and the Paying Agent as promptly as practicable
after the Liquidation Date. A copy of the Record List shall be furnished to the
Village for its records; provided, however, that the Village shall have no
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responsibility to inquire into the accuracy of the Record List or any part
thereof. and shall be entitled to rely on the matters set forth therein.
(d) Non-Transferability of Undivided Interests. The Liquidation Plan shall
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provide that the Contingent Receivable Interests are non-transferable, and that
the Village is not required to accept or honor instructions or requests to
effect transfers of Contingent Receivable Interests. Colony hereby agrees that
the Village's sole obligation, in the event that a request or instruction to
transfer a Contingent Receivable Interest is received, shall be to use its good
faith reasonable efforts to retransmit any documents comprising such instruction
or request to the Paying Agent.
(e) Change in Record List. Notwithstanding the foregoing, Steinco is
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authorized to deliver supplements or amendments of the Record List to the
Village and the Paying Agent in order to correct clerical or administrative
errors in the names, address or Percentage Interests of the Record Holders. The
Village shall have no obligation to take any action based on such supplements or
amendments, such action being solely the responsibility of the Paying Agent
pursuant to the Paying Agent Agreement.
(f) No Certificates. Colony shall not issue any certificates or other
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documentary evidence of ownership by a Record Holder of Contingent Receivable
Interests, the sole evidence thereof being the Liquidation Plan and the Record
List.
(g) Reponses to Record Holder Communications. The Village shall have no
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obligation to respond to communications from Record Holders. The Village's sole
responsibility in respect of Record Holder communications shall be to use
reasonable efforts to deliver any written communications, with reasonable
promptness, to the Paying Agent, and, in the event of receipt of email to
telephonic communications, to advise the Paying Agent by telephone of the nature
of the communication and such identifying information (such as the name and
telephone number and/or address of the party effecting such communication.
2. Procedure for Notice of Net Contingent Payments Due and Payment
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(a) Annual Accounting. On each Annual Accounting Date, the Village shall
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deliver to Steinco and the Paying Agent an accounting showing the amount of the
Net Contingent Payment due for the relevant fiscal year, in form similar to
accountings historically given by the Village to Colony. As used herein "Net
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Contingent Payment" means the gross Contingent Payment which would have been
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computed as required under the Agreement in the absence of this Addendum,
reduced by Incremental Costs as defined in Section 5(a) and the Distribution Fee
as defined in Section 7(a).
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(b) Delivery of Funds. On the Annual Accounting Date the Village shall
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deliver to the Paying Agent by check or wire transfer, consistent with past
practice, the amount of the Net Contingent Payment then due. Once so delivered,
the Village shall have no obligation whatsoever to see to or verify the
distribution of the amount of the Net Contingent Payment, and shall have no
obligation to respond to or account to any party as to such distribution, it
being the understanding and agreement of the parties that the responsibility for
such distribution is entirely the responsibility of the Paying Agent pursuant to
the Paying Agent Agreement.
3. Designation of Steinco as Liquidating Agent. Pursuant to the Liquidation
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Plan, Steinco will be appointed as the Liquidating Agent for the purposes or
carrying out the liquidation and dissolution of Colony. In such capacity,
pursuant to a Liquidating Agent Agreement, Steinco will have the right and
obligation, and is hereby granted the right in consideration of its acceptance
of such obligation, to perform the following tasks in respect of the Contingent
Receivables:
(a) to examine the books and records of the Village for the purposes set
forth in Section 3(e) of the Agreement;
(b) to enforce (to the extent any enforcement becomes necessary) the
obligations of the Village under the Agreement as amended by the First and
Second Addendums and the obligations of the Paying Agent under the Paying Agent
Agreement;
(c) to grant consents, waivers and forbearances in respect of the Village's
obligations where in the reasonable judgment of Steinco such consents, waivers
or forbearances will be in the best interests of the Record Holders;
(d) in general to exercise such rights as, prior to the Liquidation Date,
Colony had the right to exercise, all for the purpose of facilitating the
payment of the Contingent Payments to the Paying Agent and the distribution
thereof to the Record Holders; and
(e) to execute and deliver such documents and take such further steps, as
Steinco shall, in its sole discretion as Liquidating Agent for Colony and on
Colony's behalf in liquidation, determine to be in the best interests of the
Record Holders.
4. Appointment of Registrar and Transfer Company as Paying Agent
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(a) Pursuant to the Liquidation Plan and the Paying Agent Agreement, Colony
has appointed Registrar and Transfer Company (hereafter "R&T") as Paying Agent
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under the Paying Agent Agreement., which will be substantially in the form of
Exhibit A.
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(b) Pursuant to the Paying Agent Agreement, R&T will receive payment of the
Contingent Receivables, if, when and as transmitted by the Village, and will
promptly prepare and mail checks to each of the Record Holders in accordance
with their respective Percentage Interests.
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(c) The Village shall have no obligation to pay R&T's fees and expenses.
Prior to its liquidation, Colony shall be solely responsible for payment to R&T
of its fees and expenses as Paying Agent. Following Colony's liquidation,
Steinco shall apply such portion of the Reserve Account to payment of R&T's fees
and expenses and R&T will have the right to deduct any unreimbursed expenses due
R&T prior to making such payments.
5. Expenses; Village Deductions
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(a) The parties intend that the Village shall not incur any Incremental Costs
in connection with its performance of this Agreement. As used herein,
"Incremental Costs" means incremental fees or expenses of any nature, or any
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other liabilities incurred in the course of the performance of its obligations
under this Second Addendum to the Agreement (other than costs incurred as the
result of its breach of the Agreement as amended by the First and Second
Addendum to the Agreement). The term "Incremental Costs" does not include
incidental services by members of the Village's existing staff in connection
with the preparation of accountings required under the Agreement, or any other
regular and normal expenses of a nature which have customarily been incurred by
the Village in connection with the performance of the Agreement which do not
arise directly and incrementally from its performance of obligations undertaken
under this Second Addendum to the Agreement.
(b) Accordingly, the Village has the right to deduct its Incremental Costs
from the Contingent Payments along with the Distribution Fee referred to in
Section 7(a). Accounting records shall be available for review in accordance
with Section 3(e) of the Agreement.
6. Issuance of Tax Information
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(a) The Village, shall issue the Net Contingent Payments in a single check to
the Paying Agent who shall issue the individual payments to the Record Holders.
Subject to subsection (b) below, the Village shall constitute the issuer, as to
each Record Holder, of a federal income tax Form 1099, setting forth the amount
represented by such Record Holder's Percentage Interest in the Net Contingent
Payment.
(b) Notwithstanding the foregoing, all of the clerical, administrative and
other services required for the preparation of such Forms 1099, and the task of
assembling, sorting and mailing Forms 1099 to Record Holders, shall be performed
on behalf of the Village by the Paying Agent pursuant to the Paying Agent
Agreement. Such Forms 1099 shall bear the taxpayer identification number of the
Village [or, if applicable, the identifying number of the entity or division to
which the Village may at any time transfer to operations of the Water Plant].
(c) In the event that any inquiries are received by the Village from any
taxing authority or any Record Holder, such inquiries shall promptly be referred
by the Village to Steinco for resolution and the Village shall not be required
to incur any Incremental Costs in connection therewith; nor shall the Village
incur any liability whatsoever in connection therewith.
7. Consideration Payable to Village
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(a) In full and complete payment to the Village for its services hereunder,
Colony agrees to pay to the Village an amount equal to five percent (5%)
("Distribution Fee") of each installment on the Gross Contingent Amount (the
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"Gross Contingent Payment"). As used herein, "Gross Contingent Payment" means
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the Gross Contingent Amount prior to reduction for Incremental Costs.
(b) The Distribution Fee shall be deducted by the Village from the Gross
Contingent Payment prior to transmission of the Net Contingent Payment (as
defined in Section 2(a)) to the Paying Agent.
8. Confirmation of Last Accounting Period and Annual Accounting Date. The
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parties hereto agree that the last date in respect of which ERC's and Guaranteed
Revenues (as defined in Section 6(b) of the Agreement) shall be computed, as
extended by virtue of Moratoriums, is August 11, 2004. The last Annual
Accounting Date shall be January 15, 2005.
9. Representations and Warranties of Colony. Colony representations and warrants
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to the Village that:
(a) Colony is authorized by the terms of the Partnership Agreement to enter
into and perform under this Second Addendum to the Agreement;
(b) Steinco is the managing General Partner of Colony and is duly
authorized to execute this Second Addendum to the Agreement on its behalf;
(c) All necessary proceedings have been taken in order to authorize the
execution and performance by Colony and Steinco of this Second Addendum to the
Agreement; and
(d) This Second Addendum to the Agreement, the Liquidation Plan and the
implementation thereof by Colony do not and will not be in violation of the laws
of the State of Delaware or Florida or of the securities laws of the United
States, Delaware or Florida.
10. Miscellaneous
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(a) Effective Date. This Agreement is binding on Colony, Steinco and the
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Village as of the date hereto. Notwithstanding the foregoing, and subject to
subsection (c) below, the Effective Date of this Agreement shall be the date
specified in a written notice delivered by Colony to the Village which shall
state that Colony will be liquidated pursuant to the Plan on such date, and that
the provisions of this Second Addendum to the Agreement shall be effective on
such date. Such notice shall be accompanied by certified copies of the Plan, the
Paying Agent Agreement, a certified resolution of Steinco as Managing General
Partner authorized this Second Addendum to the Agreement and such other
documents as counsel to the Village shall reasonably request.
(b) Amendment. This Addendum may be modified, amended or waived only by a
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written instrument signed by all of the parties hereto, or, after the
Liquidation Date, by the Village and by Steinco on its own behalf and as
Liquidating Agent.
(c) Binding Obligation of Village; Right of Colony to Abandon Liquidation,
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Other Related Provisions.
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Notwithstanding the provisions of subsection (a) above, Colony may determine,
without obligation to the Village:
(i) not to adopt a Liquidation Plan;
(ii) to abandon the Liquidation Plan prior to its Effective Date;
(iii) to amend the Liquidation Plan to provide for the payment of the Net
Contingent Payment to Steinco as Liquidating Agent to or another entity duly
appointed by Colony in accordance with law and the Partnership Agreement,
provided that in such case Steinco or such other entity shall assume the
obligations of Colony and Steinco hereunder.
(d) Notices. Any notice or other communication required or permitted
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hereunder shall be in writing and shall be delivered personally, or sent by
certified, registered or express mail (including any private carrier
guaranteeing next business-day delivery), postage prepaid. Any such notice shall
be deemed given (i) when so delivered personally, (ii) on the date of delivery
if so mailed or sent by express mail or such private carrier as follows:
If to the Village: Xxxxx Xxxxxx, Village Manager
0000 Xxxxx Xxxx Xxxxx Xxxxxxxxx
Xxxxx Xxxx Xxxxx, XX 00000
If to Colony: c/o:
Copy to:
Xxxxx X. Xxxxx, Esq
Xxxxxxx Xxxxxxxxx LLP
0 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
If to Steinco: c/o: Xxxxx X. Xxxxxxx, Esq.
0 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
or to such other address or to the attention of such other person as the party
entitled to such notice may designate by notice to each other party hereto given
in the manner aforesaid.
(e) Indemnity. Colony and Steinco shall indemnify and hold the Village
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harmless from and against any and all claims made by any Record Holder or any
beneficial holder of Units of Colony claiming under any Record Holder, including
but not limited to any person becoming a holder of undivided interests any
installment on the Contingent Amount, arising out
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in or in connection with the performance by the Village of the provisions of
this Second Addendum to the Agreement; provided, however that this
indemnification shall not apply to any claims based upon the breach by the
Village of this Second Addendum to the Agreement, including any failure to
properly account for, compute or make payment of any installment due on the
Contingent Amount.
IN WITNESS WHEREOF the parties have executed this Agreement as of the date first
above written.
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Royal Palm Beach Colony, Xxxxx Management Company, Inc.
Limited Partnership As Managing General Partner
By: Xxxxx Management Company, Inc.
Managing General Partner By: s/
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Xxxxx X. Xxxxxxx, Vice President
By: s/
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Xxxxxx Xxxxx, President
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Xxx Xxxxxxx xx Xxxxx Xxxx Xxxxx
By: s/
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Xxxxx X. Xxxxxxx, Mayor
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