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AMENDED AND RESTATED AGREEMENT OF
LIMITED PARTNERSHIP
of
WORLD FINANCIAL PROPERTIES, L.P.
Dated as of November 20, 1996
by and among
WORLD FINANCIAL PROPERTIES, INC.
JMB 000 XXXX XXXXXX XXXXXXX COMPANY, LLC
BATTERY PARK HOLDINGS INC.
OLYMPIA & YORK TOWER B COMPANY
CANADIAN IMPERIAL BANK OF COMMERCE
WFP HOLDINGS LIMITED PARTNERSHIP
EMERALD LP HOLDINGS, INC.
and the other Persons identified on
Schedule I as limited partners
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TABLE OF CONTENTS
Section Page
RECITALS
ARTICLE 1 - DEFINITIONS
ARTICLE 2 - CONTINUATION
2.01 Continuation ...................................... 13
2.02 Filing; Publication ............................... 13
2.03 Name .............................................. 14
2.04 Place of Business; Registered Agent ............... 14
2.05 Partners .......................................... 14
2.06 Implementing Transactions.......................... 15
ARTICLE 3 - BUSINESS PURPOSE
3.01 Character of Business ............................. 14
3.02 Authorized Activities ............................. 14
ARTICLE 4 - CAPITAL CONTRIBUTIONS
4.01 Initial Contributions ............................. 15
4.02 Additional Contributions .......................... 15
4.03 Rights of Holders of Class B Units; Cancel-
lation by Managing General
Partner ........................................ 18
4.04 Partners' Accounts ................................ 19
4.05 Transfers or Conversions During Year .............. 19
ARTICLE 5 - CONVERSION RIGHTS
5.01 Class B-1 Unit Conversion ......................... 20
5.02 Class B-2 Unit Conversion ......................... 21
5.03 Additional Conversion Adjustments ................. 22
5.04 Net SF Cash and Net MCJV Proceeds ................. 22
5.05 Convertible Note Documents ........................ 23
5.06 Transfers Pursuant to JMB Agreement ............... 23
ARTICLE 6 - PROFITS, LOSSES AND DISTRIBUTIONS
6.01 Profits and Losses ................................ 23
6.02 Allocations for Tax Purposes ...................... 24
6.03 Distributions ..................................... 25
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Page
ARTICLE 7 - MANAGEMENT AND FINANCING MATTERS
7.01 Management of Business ............................ 25
7.02 No Management by Limited Partners; Limita-
tion of Liability .............................. 27
7.03 Appointment of Agents, Officers or Repre-
sentatives ..................................... 28
7.04 Title to Property; Nominee ........................ 28
7.05 Time Devoted to Business; Business with
Related Persons ................................ 29
7.06 Fiduciary Duty; Exculpation ....................... 29
7.07 Indemnification ................................... 30
7.08 Book and Records at Principal Place of
Business ....................................... 31
7.09 Annual Audit and Accounting ....................... 32
7.10 Reports; Notices .................................. 32
7.11 Tax Matters ....................................... 33
7.12 Withholding of Certain Amounts .................... 35
ARTICLE 8 - COMPENSATION
8.01 No Entitlement to Compensation .................... 36
8.02 Reimbursement ..................................... 37
ARTICLE 9 - TRANSFERS
9.01 Certain Transfers Void ............................ 37
9.02 Certain Prohibitions on Transfers ................. 37
9.03 Transfer by Certain Partners ...................... 38
9.04 Approval of Managing General Partner .............. 38
9.05 Certain Prohibited Transfers ...................... 39
9.06 Successor Managing General Partner; Removal
of Managing General Partner .................... 40
9.07 Successor Partners ................................ 41
9.08 Tag-Along Provisions .............................. 42
9.09 Transfers Must Comply with Laws ................... 45
9.10 Assumption by Transferee .......................... 45
9.11 Remedies for Impermissible Transfer ............... 45
9.12 Certificates ...................................... 46
9.13 Mutilated, Destroyed, Lost or Stolen Unit
Certificates ................................... 46
9.14 Record Holders .................................... 47
9.15 Registration of Transfer of Class A
Units........................................... 47
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Page
ARTICLE 10 - DISSOLUTION AND TERMINATION
10.01 Events of Dissolution ............................. 49
10.02 Continuance of the Partnership .................... 50
10.03 Liquidation of Partnership Assets ................. 50
10.04 Time for Winding-Up ............................... 52
ARTICLE 11 - GENERAL PROVISIONS
11.01 Entire Agreement .................................. 52
11.02 Appointment of Attorney or Agent .................. 54
11.03 Construction ...................................... 55
11.04 Governing Law ..................................... 55
11.05 Further Assurances ................................ 55
11.06 Titles and Captions ............................... 55
11.07 Binding Agreement ................................. 55
11.08 Waiver of Participation; Appraisal
Rights ......................................... 55
11.09 Counterparts and Effectiveness .................... 55
11.10 Waiver of Trial by Jury ........................... 56
Signatures .................................................... 57
SCHEDULE I Partners and Units
EXHIBIT A Form of Unit Certificate
EXHIBIT B Form of Transfer Application
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AMENDED AND RESTATED AGREEMENT OF
LIMITED PARTNERSHIP
AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP of WORLD
FINANCIAL PROPERTIES, L.P. (the "Partnership"), dated as of November 20, 1996,
by and among WORLD FINANCIAL PROPERTIES, INC., a Delaware corporation, as a
general partner, JMB 000 XXXX XXXXXX XXXXXXX COMPANY, LLC (together with its
successors and assigns, "JMB Partner"), as a general partner, and BATTERY PARK
HOLDINGS INC. (together with its successors and assigns, "BPHI"), OLYMPIA & YORK
TOWER B COMPANY (together with its successors and assigns, "OYTBC"; OYTBC,
together with BPHI, "BPHI Partner"), CANADIAN IMPERIAL BANK OF COMMERCE
(together with its successors and assigns, "CIBC Partner"), WFP HOLDINGS LIMITED
PARTNERSHIP (together with its successors and assigns, "Dragon Partner"),
EMERALD LP HOLDINGS, INC. (together with its successors and assigns, "Citibank
Partner"), and the other Persons (as hereinafter defined) identified on Schedule
I, as limited partners.
R E C I T A L S :
A. The Partnership was formed as a Delaware limited partnership
pursuant to the Original Partnership Agreement (as hereinafter defined) between
the Original Partners (as hereinafter defined).
B. In furtherance of the consummation of the transactions contemplated
in the Plan (as hereinafter defined), the parties hereto desire to admit the New
Partners (as hereinafter defined) and to amend and restate the provisions of the
Original Partnership Agreement.
A G R E E M E N T :
The parties hereto agree that the New Partners are hereby admitted to
the Partnership and the Original Partnership Agreement is hereby amended and
restated in its entirety as follows:
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ARTICLE 1 - DEFINITIONS
As used herein, the following terms have the meanings assigned to them
in this Article:
Act: The Delaware Revised Uniform Limited Partner-
ship Act, as amended from time to time.
Additional Equity Interests: Equity securities of the Partnership
issued after the date hereof pursuant to the provisions of Section 4.02;
provided, however, that the Convertible Notes shall not constitute
Additional Equity Interests for any purpose of this agreement.
Additional General Partner: JMB Partner, any Person admitted to the
Partnership as an Additional General Partner thereof (upon conversion of
all or part of its Interest as a Limited Partner or otherwise) pursuant to
the provisions of subsection 4.02(c) and any other Person that hereafter
becomes an Additional General Partner of the Partnership in accordance
with the provisions of Article 9 (other than Section 9.06), in each case
until such Additional General Partner shall cease to be a general partner
of the Partnership pursuant to the provisions of this agreement or
applicable law.
Adjusted Tag-Along Amount: In respect of the Unrestricted Units of
any Tag-Along Partner relating to a particular Tag-Along Sale, the product
of (i) the maximum number of Class A Units of such Tag-Along Partner
specified in such Tag Along Partner's Tag-Along Notice and (ii) a
fraction, the numerator of which is the actual percentage (which shall not
be less than the Original Sale Percentage in respect of such Tag-Along
Sale) of all then outstanding Class A Units (computed on a basis that
assumes all Convertible Notes (exclusive of any accrued interest in
respect thereof) have been converted to Class A Units) that the applicable
Tag-Along Purchaser has agreed to purchase in such Tag-Along Sale and the
denominator of which is the Original Sale Percentage in respect of such
Tag-Along Sale plus the aggregate of (A) the Tag-Along Sale Percentages of
each Tag-Along Partner in respect of such Tag-Along Sale and (B) if there
shall be any Convertible Notes then outstanding, the Tag-Along Sale
Percentages (as defined in the Convertible Note Indenture) of each holder
of Convertible Notes that has delivered a
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Tag-Along Notice (as defined in the Convertible Note Indenture) in respect
of such Tag-Along Sale.
Affiliate: With reference to any Person, any other
Person that "Controls," is "Controlled by" or is under
"common Control with" such Person.
Arm's-length Basis: As to any transaction, agreement
or other arrangement, being on terms that would be reached
by unrelated parties not under any compulsion to contract.
Available Funds: As defined in Section 6.03.
Bank of Nova Scotia Settlement: The compromise and settlement of
certain claims of The Bank of Nova Scotia to be effected in accordance
with section 4.9 of the Plan.
Bankruptcy: The "Bankruptcy" of a Person shall be
deemed to have occurred upon the happening of any of the
following:
(a) The valid appointment of a receiver or trustee to
administer all or a substantial portion of such Person's assets or
such Person's Interest (if any) in the Partnership;
(b) The filing by such Person of a voluntary petition for
relief under the Bankruptcy Code or of a pleading in any court of
record admitting in writing its inability to pay its debts as they
become due;
(c) The making by such Person of a general
assignment for the benefit of creditors;
(d) The filing by such Person of an answer admitting the
material allegations of, or its consenting to or defaulting in
answering, a petition for relief filed against it in any proceeding
under the Bankruptcy Code; or
(e) The entry of an order, judgment or decree of any court of
competent jurisdiction granting relief against such Person in a
proceeding under the Bankruptcy Code, and such order, judgment or
decree continuing unstayed and in effect for a period of thirty (30)
days after such entry.
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Bankruptcy Code: The Bankruptcy Reform Act of 1978,
as amended and as codified at title 11, United States
Code, as amended from time to time.
Bankruptcy Court: The United States District Court
for the Southern District of New York having jurisdiction
over the Reorganization Cases (as defined in the Plan).
Business Day: Any day other than a Saturday, a Sun- day or any other
day on which banking institutions in New York, New York, are required or
authorized to close by law or executive order.
Capital Contribution: As defined in Section 4.01.
Certificate: The Partnership's Amended and Restated
Certificate of Limited Partnership filed in the office of
the Secretary of State of the State of Delaware, as
amended from time to time.
Change in Control: As to any Partner, a change, shift or transfer of
Control with respect to such Partner, including, without limitation, any
change in the Control of any Person Controlling such Partner; provided,
however, that no Change in Control shall be deemed to have occurred upon
any such change, shift or transfer of Control of the Ultimate Control
Person in respect of such Partner.
Class A Unit: A fractional interest in all the capital of the
Partnership equal, on the date hereof, to one thousandth of one percent of
all such capital as of the date hereof (exclusive of capital, if any,
attributable to the capital stock of each of SF Holdings and Florida
Equity Corp.).
Class B Units: Collectively, the Class B-1 Units and
the Class B-2 Units.
Class B-1 Unit: A fractional interest in all the interest and
rights, if any, of the Partnership attributable to the capital stock of SF
Holdings equal to one thousandth of one percent of all such interest and
rights.
Class B-2 Unit: A fractional interest in all the
interest and rights of the Partnership attributable to the
capital stock of Florida Equity Corp. equal to one thou-
sandth of one percent of all such interest and rights.
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Code: The Internal Revenue Code of 1986, as amended
from time to time, or any successor statute or statutes to
the Internal Revenue Code of 1986.
Control, Controlling, Controlled: As to any Person, the possession,
directly or indirectly, of the power to direct or cause the direction of
the management and policies of such Person, whether through ownership of
voting securities or partnership interests, by contract or otherwise.
Conversion Notice: The notice required to be given by
a holder of one or more Convertible Notes in order to exer-
cise the Conversion Right.
Conversion Right: The right to convert the indebted-
ness evidenced by the Convertible Notes into Class A Units
(or a fraction of a Class A Unit).
Convertible Note Documents: The Convertible Notes,
together with the Convertible Note Indenture.
Convertible Note Indenture: The indenture (as from
time to time amended) pursuant to which the Convertible
Notes are being issued on the date hereof.
Convertible Notes: The Company's Increasing Rate Con-
vertible Notes due 2004.
Coopers & Xxxxxxx OYDL: Collectively, Coopers & Xxxxxxx OYDL, Inc.
and Coopers & Xxxxxxx OYDL Limited, as the trustee in the bankruptcy for
Olympia & York Developments Limited, an Ontario corporation.
Core Properties: Those parcels of real property located at (i) 00
Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx, (ii) Xxx Xxxxxxx Xxxxx, Xxx Xxxx, Xxx
Xxxx, (xxx) 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, (iv) One World Financial
Center, New York, New York, (v) Two World Financial Center, New York, New
York, and (vi) Four World Financial Center, New York, New York, in each
case together with the office building and other improvements existing
thereon.
Disputed MCJV Recovery: The recovery that may be realized by the
Partnership or Persons wholly-owned by it from the sale of the MCJV Lands
or the stock of Florida Equity Corp., the amount of which is dependent
upon the resolution of the claims alleged in a suit captioned In re
Holywell
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Corp., Case No. 84-01590/94-BKC-PGH, before the United
States Bankruptcy Court for the Southern District of
Florida.
Disputed Realty Corp. Assets: The Disputed MCJV Recov-
ery and the Disputed SF Cash.
Disputed SF Cash: The cash of SF Holdings, subject to
a claim of ownership that has been made by Coopers & Xxxxxxx
OYDL in a case before the Ontario Court of Justice captioned
Coopers & Xxxxxxx OYDL Limited v. Olympia & York Realty
Corp. and Olympia & York SF Holdings Corporation, Ontario
Court Action No. 93-CQ-38609.
Dragon Control Group: Any of the following Persons or any group of
such Persons (other than Dragon Partner): Mr. Xx Xx Xxxxx, his spouse, any
child, grandchild or remoter issue or descendant of Mr. Xx Xx Xxxxx, any
spouse of any such child, grandchild, remoter issue or descendant or any
of their estates (collectively called the "Li Family Group"); (ii) any
trust or trusts substantially all of the beneficiaries of which consist of
one or more members of the Li Family Group, whether living or potential,
either alone or together with one or more charitable objects established
or to be established by, in the name of or in memory of any Person or
Persons who are themselves Li Group Members; or (iii) any one or more
Persons who are Controlled by any Person or group of Persons referred to
in clauses (i) or (ii) above or by any other Person or group of Persons
that is or are themselves Li Group Members by virtue of this paragraph
(iii).
Equity Interest: With respect to each Partner or assignee of a
Partner at any time, that portion of all the Class A Units then
outstanding that is then owned by such Partner or assignee, being equal to
the quotient of the number of Class A Units owned by such Partner or
assignee at such time divided by the total number of all Class A Units
then outstanding.
Excluded Class B Partners: The Persons that are Founding Limited
Partners on the date hereof and those other Persons identified as
"Excluded Class B Partners" on Schedule I to this agreement.
Excluded Holders: The following Persons: (i) the Man-
aging General Partner, (ii) each Additional General Partner
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having any authority to act for or on behalf of or to bind the Partnership
on any matter, (iii) each Affiliate or Related Person of the Managing
General Partner or any such Additional General Partner, (iv) each Person
that is a Founding Limited Partner on the date hereof and (v) each
Affiliate of any Person specified in clauses (i) through (iv) above.
Fair Market Value: As to any property, the price at which a willing
seller would sell and a willing buyer would buy such property having full
knowledge of the facts, and assuming each party acts on an Arm's-length
Basis with the expectation of concluding the purchase or sale within a
reasonable time.
Florida Equity Corp.: A Florida corporation that holds
a 50% interest in MCJV and is wholly-owned by the
Partnership.
Founding Limited Partners: BPHI Partner, CIBC Partner, Dragon
Partner and Citibank Partner; provided, however, that (i) no assignee or
transferee of any such Partner (other than a Wholly Owned Affiliate
thereof) shall be a Founding Limited Partner (the rights of each such
Partner as a Founding Limited Partner being personal to such Partner and
not assignable or otherwise transferable except to a Wholly Owned
Affiliate as aforesaid), (ii) BPHI Partner shall cease to be a Founding
Limited Partner upon any Change in Control of BPHI Partner or any Transfer
by BPHI Partner of its direct or indirect Interest after which BPHI
Partner and its Affiliates shall own beneficially or of record a number of
Class A Units that is less than [23]% of the number of Class A Units
issued on the date hereof to BPHI Partner, (iii) CIBC Partner shall cease
to be a Founding Limited Partner upon any Change in Control of CIBC
Partner or any other Transfer by either CIBC Partner or Dragon Partner of
its direct or indirect Interest after which CIBC Partner and Dragon
Partner and their Affiliates collectively shall own, beneficially or of
record, a number of Class A Units that is less than [46]% of the aggregate
number of Class A Units issued on the date hereof to CIBC Partner and
Dragon Partner, (iv) Dragon Partner shall cease to be a Founding Limited
Partner upon any Change in Control of Dragon Partner or any other Transfer
by either CIBC Partner or Dragon Partner of its direct or indirect
Interest after which CIBC Partner and Dragon Partner and their Affiliates
collectively shall own, beneficially or of record, a number of Class A
Units
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that is less than 46% of the aggregate number of Class A Units issued on
the date hereof to CIBC Partner and Dragon Partner, and (v) Citibank
Partner shall cease to be a Founding Limited Partner upon any Change in
Control of Citibank Partner or any other Transfer of its direct or
indirect Interest after which Citibank Partner and its Affiliates shall
own beneficially or of record a number of Class A Units that is less than
[52]% of the number of Class A Units issued on the date hereof to Citibank
Partner. Without limiting the foregoing provisions of this definition,
each of CIBC Partner, Dragon Partner and Citibank Partner shall cease to
be a Founding Limited Partner upon the consummation of any Qualified
Public Offering of Class A Units in which such Partner and its Affiliates
are offered (a reasonable time in advance of such Qualified Public
Offering) the opportunity, or are entitled by contract, to participate as
to all their Class A Units and fail to do so under circumstances where the
registration and sale of all the Class A Units owned beneficially by them
(together with the registration and sale of all other Class A Units to be
sold in such Qualified Public Offering) would not have resulted in per
unit proceeds of sale that were lower (other than by a de minimis amount)
than the amount that would be obtained absent the registration and sale of
all the Class A Units owned by them, as reasonably determined by the
managing underwriter of such Qualified Public Offering prior to the
effective date of such Qualified Public Offering.
GAAP: As defined in Section 7.09.
General Partners: The Managing General Partner and all
Additional General Partners as a group.
Group: As defined in Sections 13(d)(3) and 14(d)(2) of
the Securities Exchange Act of 1934, as amended and in
effect on the date hereof.
Implementing Transactions: Those agreements, actions
and transactions described in Schedule 18 to the Plan.
Independent Accountants: As defined in Section 7.09.
Initial Unit Value: The deemed Fair Market Value of a Class A Unit
on the date hereof, being $ (viz., the product of .001% and the
Partnership Reorganization Value).
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Interest: As to each Partner, such Partner's rights to participate
in the income, gains, losses, deductions and credits of the Partnership,
together with all other rights and obligations of such Partner under this
agreement.
JMB: XXX/000 Xxxx Xxxxxx Associates, Ltd.
JMB Agreement: The JMB Transaction Agreement, dated as of the date
hereof, pursuant to which, among other things, the Partnership provides to
JMB and JMB Partner certain rights contemplated in Sections 15.8 and 18.13
of the Plan.
JMB Control Person: JMB Realty Corporation, a Delaware
corporation, and its successors and assigns.
JMB Controlled Affiliate: A Person (i) Controlled by the JMB Control
Group or that Controls the JMB Control Group and (ii) in which the JMB
Control Person or a Person that Controls the JMB Control Person owns
directly or indirectly more than 50% of all capital and profits interests.
JMB Disqualification Event: The occurrence of any
event specified in subclause (x) or (y) of clause (B) of the
last sentence of subsection 4.02(e).
Limited Partners: The Persons identified as Limited Partners on
Schedule I and any other Person that hereafter becomes a limited partner
of the Partnership in accordance with the provisions of Article 9 or
Section 4.02 of this agreement.
Majority Interest: At any time, an interest, direct or indirect, in
any Person or group of Persons (including, without limitation, the
Partnership but excluding all Ultimate Control Persons and all Persons
that Control any Ultimate Control Person) which, at such time, represents
beneficial ownership of more than 50% of the outstanding Equity Interests
in the Partnership.
Managing General Partner: World Financial Properties, Inc., a
Delaware corporation, unless and until such corporation shall cease to be
a general partner of the Partnership pursuant to subsection 10.01(c)
hereof, and thereafter any successor Managing General Partner of the
Partnership admitted pursuant to Section 9.04 hereof.
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MCJV: Miami Center Joint Venture, a Florida joint
venture.
MCJV Lands: Those certain four parcels of real estate located east
of Southeast 2nd Avenue, west of Biscayne Bay, north of the Miami River,
and south of Xxxxxxxxx 0xx Xxxxxx in Miami, Florida.
New Partners: Each Person that executes a counterpart
of this agreement on or as of the date hereof other than the
Original Partners.
New 245 Park LP: The Delaware limited partnership that owns 000 Xxxx
Xxxxxx.
Original Partners: BPHI and World Financial Proper-
ties, Inc.
Original Partnership Agreement: The letter agreement dated as of
October 8, 1996 between the Original Partners pursuant to which the
Partnership was formed as a limited partnership under the Act.
Partners: The Managing General Partner, any Additional
General Partners and the Limited Partners as a group.
Partnership Reorganization Value: $ .
Person: A natural person or a corporation, partner-
ship, limited liability company, trust, unincorporated asso-
ciation or other entity.
Plan: The Third Amended Joint Plan of Reorganization of Olympia &
York Realty Corp., et al., Chapter 11 case number 92B42698 (JLG) (jointly
administered), dated September 12, 1996, as confirmed by the Bankruptcy
Court on September 20, 1996, as such Plan may be amended from time to
time.
Public Market Effective Date: The first day after the date hereof
that (i) there shall have occurred a Qualified Public Offering and (ii)
the Class A Units shall be registered under Section 12 of the Securities
Exchange Act of 1934, as amended, and the Partnership shall be subject to
the reporting requirements of the Securities Exchange Act of 1934, as
amended.
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Qualified Public Offering: A sale of Class A Units to the public in
an underwritten offering of such Class A Units pursuant to a registration
statement (other than a registration statement on Form S-4 or Form S-8 or
any successor or other forms for purposes similar to the purposes of such
forms) of the Partnership filed and declared effective under the
Securities Act of 1933, as amended, that (i) is either (A) required to be
effected by the Partnership pursuant to the registration rights agreement
dated as of the date hereof by and among the Founding Limited Partners,
JMB Partner and the Partnership or (B) duly authorized by all requisite
corporate and shareholder action of the Managing General Partner and (ii)
results in an active trading market in Class A Units.
Qualifying Interest: At any time, an interest, direct or indirect,
in any Person or group of Persons (including, without limitation, the
Partnership but excluding all Ultimate Control Persons and all Persons
that Control any Ultimate Control Person) which, at such time, represents
beneficial ownership of 35% or more, but not more than 50%, of the
outstanding Equity Interests in the Partnership.
Record Holder: The Person in whose name any Class A Unit is
registered on the register maintained by the Partnership pursuant to the
provisions of Section 9.15.
Related Person: As to any General Partner, at any time, any Person
that is then (i) an Affiliate of such General Partner (other than a Person
Controlled by the Partnership), (ii) the Record Holder or beneficial owner
of Class A Units representing 20% or more of all the Class A Units then
outstanding, (iii) the Record Holder or beneficial owner of Additional
Equity Interests of any class or series representing 20% or more of all
Additional Equity Interests in such class or series then outstanding, (iv)
the record or beneficial owner of 10% or more of the then outstanding
equity securities (of any class or series) of such General Partner, (v)
any Founding Limited Partner (other than Dragon Partner) or (vi) any
Affiliate of a Person described in clause (ii), (iii), (iv) or (v) above
(other than a Person Controlled by the Partnership).
Required Founding Limited Partners: The following Per-
sons: (i) Citibank Partner (but only so long as Citibank
Partner shall be a Founding Limited Partner), and (ii) other
Persons then constituting Founding Limited Partners whose
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Equity Interests aggregate (together with the Equity Interest of Citibank
Partner) not less than 80% of the aggregate Equity Interest of all Persons
that then constitute Founding Limited Partners.
Required Partners: As defined in subsection 9.06(b).
Required Unrestricted Unitholders: At any time, Persons constituting
(i) the Record Holders of Unrestricted Units then representing more than
50% of all Unrestricted Units then outstanding and (ii) (A) if, at such
time, any Person or Group (together with its Affiliates) shall then hold
(beneficially or of record) Unrestricted Units representing more than 40%
of all Unrestricted Units then outstanding, (1) such Person or Group
(together with its Affiliates) and (2) the Record Holders of Unrestricted
Units constituting not less than 66 2/3% of all then outstanding
Unrestricted Units not then held of record or beneficially, directly or
indirectly, by (x) such Person or Group (or any of its Affiliates) or (y)
any Excluded Holder and (B) at all other times, Record Holders of
Unrestricted Units constituting not less than 66 2/3% of all then
outstanding Unrestricted Units not then held of record or beneficially,
directly or indirectly, by any Excluded Holder.
SF Holdings: Olympia & York SF Holdings Corporation, a New Brunswick
corporation that is wholly-owned by the Partnership and a Debtor in the
Reorganization Cases (as defined in the Plan).
Tag Along Sale: A Qualifying Tag-Along Sale or a
Majority Tag-Along Sale.
Tag Along Sale Percentage: As to each Tag-Along Partner in respect
of any particular Tag-Along Sale, the quotient (expressed as a percentage)
obtained by dividing (i) the maximum number of Class A Units of such
Tag-Along Partner specified in the Tag-Along Notice given by such Tag-
Along Partner in respect of such Tag-Along Sale by (ii) the total number
of then outstanding Class A Units (computed on a basis that assumes all
Convertible Notes (exclusive of any accrued interest in respect thereof)
have been converted into Class A Units).
Tax Advance: As defined in the Plan (as in effect on
the date hereof).
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Transfer: Any direct or indirect transfer, sale, conveyance, pledge,
hypothecation or other disposition of the direct or indirect beneficial
ownership of all or any part of an Interest, including, without
limitation, any of the foregoing that occurs by virtue of transfer of
securities of any Person (other than an Ultimate Control Person) or the
occurrence of any Change in Control.
Transfer Agent: The Managing General Partner, in its capacity as
transfer agent pursuant to the provisions of Section 9.15, and each
successor Person appointed by the Managing General Partner to act as such
transfer agent.
Transfer Application: An application to register a
Transfer of one or more Class A Units, substantially in the
form annexed hereto as Exhibit B.
Treasury Regulations: Regulations promulgated under
the Code and from time to time in effect.
000 Xxxx Xxxxxx: That certain parcel of real property
located at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, together
with the office building and other improvements existing
thereon.
Ultimate Control Person: In respect of (i) BPHI Partner, Brookfield
Properties Corporation, (ii) CIBC Partner, Canadian Imperial Bank of
Commerce, (iii) Citibank Partner, Citibank, N.A., (iv) JMB Partner, the
JMB Control Person, (v) Dragon Partner, the Dragon Control Group and (vi)
any other Partner, any Person that directly or indirectly Controls such
Limited Partner if such Person (a) has issued and outstanding at least one
class of equity securities that is listed on a national securities
exchange in the United States and (b) has net assets in excess of
$100,000,000 as of the end of its most recently concluded fiscal year.
Unit Certificate: A certificate, substantially in the
form of Exhibit A annexed hereto, evidencing ownership of
one or more Class A Units.
Unit Value: As of any date, the Fair Market Value of a Class A Unit,
as determined in good faith by the Managing General Partner (taking
account of all relevant considerations, including, without limitation, the
Fair Market Value of the assets of the Partnership, the liabilities of the
Partnership and the terms of any Additional Equity Interests
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(including, without limitation, any Additional Equity Interests that are
exchangeable for or convertible into different Additional Equity
Interests)); provided, however, that, in each case where Class A Units are
to be issued to a General Partner or a Related Person of a General Partner
or a Founding Limited Partner (other than Dragon Partner), such
determination shall not be effective unless (i) confirmed in writing by an
independent investment banking institution of national reputation selected
by the Managing General Partner or (ii) in the same transaction and at the
same time (and on the same terms and for the same consideration per Class
A Unit) a greater number of Class A Units are to be issued to Persons that
are not (A) a General Partner, (B) a Related Person of a General Partner
or (C) a Founding Limited Partner (other than Dragon Partner).
Unrestricted Units: Class A Units (i) contemplated in the Plan to be
issued upon consummation of the Plan to JMB Partner, (ii) issued upon
conversion of any Class B Units transferred to JMB Partner pursuant to
Section 2 of the JMB Agreement, (iii) contemplated in the Plan to be
issued upon consummation of the Plan to a Limited Partner that is not a
Founding Limited Partner on the date hereof, (iv) issued upon exercise of
the Conversion Right (other than in respect of any Convertible Note
distributed to any Person that is a Founding Limited Partner on the date
hereof, or any assignee thereof, pursuant to Section 20.5 of the Plan) or
(v) except as otherwise provided in clause (ii) above, issued upon
conversion of Class B Units held on the date hereof by any Person other
than Excluded Class B Partners, all of which Class A Units shall retain
their character as Unrestricted Units notwithstanding any Transfer
thereof; provided, however, that Unrestricted Units shall not include any
Class A Units included at any time in the Aggregate Disallowed Amount (as
defined in the Plan) relating to the Subclass 7.11.1 Disputed Claims
Debt/Equity Escrow (as defined in the Plan).
Wholly Owned Affiliate: With respect to any Person, any Affiliate of
such Person, the ultimate beneficial ownership of which Affiliate is held
by the same Persons and in the same proportions as the ultimate beneficial
ownership of such Person is held.
Withholding Advance: As defined in Section 7.12.
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ARTICLE 2 - CONTINUATION
2.01 Continuation. The Partnership was heretofore formed by the
Original Partners pursuant to the provisions of the Act and the Managing General
Partner has heretofore filed a certificate of limited partnership in accordance
with the provisions of the Act in respect of the Partnership. The Partners
hereby continue the Partnership as a limited partnership in accordance with the
provisions of the Act.
2.02 Filing; Publication. The Managing General Partner shall take
all action required by law to continue and maintain the Partnership as a limited
partnership under the Act and under the laws of all jurisdictions in which the
Partnership may elect to conduct business, including, without limitation, the
filing of amendments to the Certificate with the Del- aware Secretary of State
and qualification of the Partnership as a foreign limited partnership in the
jurisdictions in which such qualification shall be required, as determined by
the Managing General Partner. The Managing General Partner shall also promptly
register the Partnership under applicable assumed or fictitious name statutes or
similar laws.
2.03 Name. The name of the Partnership shall continue to be World
Financial Properties, L.P. The Managing General Partner may adopt such assumed
or fictitious names as it deems appropriate in connection with the
qualifications and registrations referred to in Section 2.02.
2.04 Place of Business; Registered Agent. The location of the
principal office of the Partnership shall initially be c/o World Financial
Properties, Inc., Xxx Xxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, and thereafter at
such other location as the Managing General Partner may designate upon written
notice to the other Partners. The Partnership's registered agent in the State of
Delaware shall be The Corporation Trust Company, having an address at 0000
Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx.
2.05 Partners. The name and address of each Partner
shall be as set forth in the books and records of the
Partnership.
2.06 Implementing Transactions. The Managing Gen-
eral Partner shall cause the Partnership and Persons Controlled
by it to take all actions necessary or desirable in the judg-
ment of the Managing General Partner to consummate or give
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effect to the Implementing Transactions. Without limiting the generality of the
immediately preceding sentence, the Managing General Partner is authorized to
cause the Partnership and the Persons Controlled by it to enter into and perform
its and their obligations under or in respect of any and all agreements
contemplated or deemed necessary by the Managing General Partner to consummate
the Implementing Transactions.
ARTICLE 3 - BUSINESS PURPOSE
3.01 Character of Business.
(a) The business of the Partnership shall be to (i) acquire, own,
operate, manage, finance, lease, dispose of and otherwise deal with interests in
real estate and securities related to or secured by interests in real estate,
such interests to be owned directly or indirectly (as, for example, through the
ownership of equity securities in Persons that own or otherwise deal with
interests in real estate) and (ii) transact any and all other businesses for
which limited partnerships may be formed under Delaware law.
(b) In furtherance of its business, the Partnership may participate
in other Persons and serve as general or limited partner, joint venturer,
manager, agent or representative for such other Person.
3.02 Authorized Activities. In carrying out the purposes of the
Partnership, but subject to all other provisions of this agreement, the
Partnership is authorized to engage in any kind of lawful activity, and perform
and carry out contracts of any kind, necessary or advisable in connection with
the accomplishment of the purposes and business of the Partnership described
herein and for the protection and benefit of the Partnership.
ARTICLE 4 - CAPITAL CONTRIBUTIONS
4.01 Initial Contributions. In accordance with all applicable
provisions of the Plan, each Partner, on the date hereof, has made an initial
contribution of capital (a "Capital Contribution") to the Partnership. Each
Partner on the date hereof shall own that number of Class A Units and Class B
Units as is set forth on Schedule I and shall, in respect of the Class A Units
owned by it, be issued a Unit Certificate.
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4.02 Additional Contributions.
(a) No Partner shall be obligated to make any Capital Contribution
other than as set forth in Section 4.01. Without limiting any other right or
power of the Managing General Partner hereunder or under applicable law, the
Managing General Partner may at any time without notice to any other Partner
(except as may be required pursuant to subsection 7.10(b)) accept Capital
Contributions of cash or property from and issue new Class A Units or Additional
Equity Interests to any Partners or admit new Partners to the Partnership in
connection with the making by such Partners of Capital Contributions consisting
of cash or property (including, without limitation, any such Capital
Contribution made in connection with the creation of an umbrella partnership
real estate investment trust or similar investment vehicle) and may issue Class
A Units or Additional Equity Interests of the Partnership to such Partners;
provided, however, that no Additional Equity Interests may be issued in exchange
for Class A Units. Each Person that makes any such Capital Contribution (other
than any Persons entitled to Class A Units pursuant to Article 5 or upon
exercise of the Conversion Right) shall be issued (i) Class A Units in a number
equal to the quotient obtained by dividing the Fair Market Value of such Capital
Contribution (as determined by the Managing General Partner in good faith) by
the Unit Value in effect immediately preceding the making of such Capital
Contribution or (ii) such Additional Equity Interests of the Partnership as the
Managing General Partner shall, in good faith, deem to be equal in value to the
Fair Market Value of such Capital Contribution (as determined by the Managing
General Partner in good faith, taking account of all relevant considerations,
including, without limitation, the Fair Market Value of the assets of the
Partnership, the liabilities of the Partnership and the terms of any Additional
Equity Interests (including, without limitation, any Additional Equity Interests
that are exchangeable for or convertible into different Additional Equity
Interests)); provided, however, that, in any case where Class A Units or
Additional Equity Interests are to be issued to a General Partner or a Related
Person of a General Partner or to a Founding Limited Partner (other than Dragon
Partner), such determination shall not be effective unless (A) confirmed in
writing by an independent investment banking institution of national reputation
selected by the Managing General Partner or (B) in the same transaction and at
the same time (and on the same terms and for the same consideration per Class A
Unit or per Additional Equity Interest) a greater number of Class A Units or
Additional Equity Interests are to be
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issued to Persons that are not (1) a General Partner, (2) a Related Person of a
General Partner or (3) a Founding Limited Partner (other than Dragon Partner).
(b) Notwithstanding any contrary provision of this agreement, the
Managing General Partner may not cause the Partnership to issue any new Class A
Units or Additional Equity Interests in the Partnership unless after giving
effect thereto (and any contemporaneous issuance or Transfers of Class A Units
or Additional Equity Interests to the Managing General Partner) the Managing
General Partner shall own at least a 1% interest in the capital of, and in all
items of income, gain, loss, deduction and credit of, the Partnership; provided,
however, that, upon the exercise of the Conversion Right by any holder of
Convertible Notes, the Managing General Partner and the Founding Limited
Partners shall take such actions (including, without limitation, the Transfer of
Class A Units by the Founding Limited Partners to the Managing General Partner)
as shall be necessary to cause the provisions of this subsection to be complied
with as of the time of the issuance of any Class A Units in respect of such
exercise.
(c) The Managing General Partner may, without the approval of any
Partner, admit Additional General Partners to the Partnership in connection with
the making of a Capital Contribution in accordance with the provisions of
subsection 4.02(a) or (with the written approval of the affected Limited
Partner) upon a conversion of all or any part of the Interest of any Limited
Partner into a general partner's Interest in the Partnership. All Additional
General Partners shall have such rights and authority to act for or on behalf of
or to bind the Partnership as shall be determined from time to time by the
Managing General Partner and reflected in an amendment to this agreement;
provided, however, that no Additional General Partner shall have any greater
rights to act for or on behalf of or to bind the Partnership than have herein
been granted to the Managing General Partner. No Additional General Partner
shall have any authority to act for or on behalf of or to bind the Partnership
until such Additional General Partner shall have executed an instrument pursuant
to which it agrees to be bound by the provisions of this agreement (as amended
by any amendment executed by the Managing General Partner pursuant to the
provisions of the immediately preceding sentence).
(d) Subject to the provisions of subsection 9.05(c), the Managing
General Partner may, without the approval of any Partner (other than the
affected Additional General Partner,
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which approval may be withheld in its absolute discretion), convert all or any
part of the Interest of any Additional General Partner into a limited
partnership Interest in the Partnership.
(e) JMB Partner shall be an Additional General Partner of the
Partnership, and shall have (i) all voting and approval rights that are
available generally to Limited Partners of the Partnership and (ii) no authority
to act for or on behalf of or to bind the Partnership or any other Partner on
any matter except to the extent that JMB Partner may hereafter be authorized in
writing by the Managing General Partner to act for or on behalf of or to bind
the Partnership pursuant to the provisions of subsection 4.02(c).
Notwithstanding any contrary provision of this agreement, (A) each and every
transferee of any Class A Unit from JMB Partner (other than a transferee that is
a JMB Controlled Affiliate) shall, effective immediately upon such transferee's
acquisition thereof, hold such Class A Unit as if transferred from a Limited
Partner of the Partnership and not a General Partner and (without the written
consent of the Managing General Partner) no such transferee shall be admitted to
the Partnership except as a Limited Partner and (B) JMB Partner shall cease to
be an Additional General Partner and the entire Interest in the Partnership of
JMB Partner shall automatically become a limited partnership Interest upon any
(x) Transfer by JMB Partner or any JMB Controlled Affiliate of Class A Units to
any Person that results in JMB Partner, JMB and all JMB Controlled Affiliates
owning less than 5% of the Class A Units originally issued to JMB Partner
hereunder, (y) Bankruptcy of JMB or JMB Partner or (z) receipt by the Managing
General Partner of a notice from JMB Partner in which JMB Partner elects to
convert its Interest to a limited partnership Interest.
4.03 Rights of Holders of Class B Units; Cancella-
tion by Managing General Partner.
(a) The holders of Class B Units shall be given credit (to be
applied only to the issuance of Class A Units as herein provided) for all the
income and capital, if any, of the Partnership with respect to the capital stock
of each of SF Holdings and Florida Equity Corp. during the period prior to any
conversion of such Class B Units into Class A Units as herein contemplated. The
holders of Class B Units (in their capacities as such holders only) shall not be
entitled to any interest in the income or capital of the Partnership with
respect to any other asset of the Partnership. Prior to
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conversion of any Class B Units into Class A Units pursuant to Article 5 hereof,
the holders of such Class B Units (in their capacities as such) shall not have
any right to vote on any matters subject to the approval of the Partners or to
receive any distribution from the Partnership (other than (in the event the
Partnership shall be liquidated prior to the conversions contemplated in Article
5 of this agreement) a distribution of the capital stock of each of SF Holdings
and Florida Equity Corp. or the proceeds thereof (pro rata based on the number
of Class B Units held by each Partner) upon liquidation of the Partnership).
(b) The Managing General Partner may, by written notice given to the
Partners at any time, cancel all or part of the Class B Units, as appropriate,
if (i) the Managing General Partner shall have determined in its reasonable
discretion (based on facts or circumstances hereafter becoming known to the
Managing General Partner (including, without limitation, the issuance of any
rulings or judgments in any proceedings related to the Disputed Realty Corp.
Assets)) that, notwithstanding commercially reasonable efforts by the
Partnership to enforce or negotiate its claims with respect to the Disputed
Realty Corp. Assets, the net value to the Partnership of the capital stock of SF
Holdings or of Florida Equity Corp. is insufficient to justify the continued
expenditure of effort or funds by the Partnership to realize on its claims with
respect to the Disputed SF Cash or the Disputed MCJV Recovery or (ii) there
shall have been issued a final nonappealable ruling by a court of competent
jurisdiction denying the validity of the Partnership's claims to the Disputed SF
Cash or the Disputed MCJV Recovery.
(c) Nothing in this Section 4.03 shall limit the Partnership's
rights against Limited Partners holding Class B Units under the provisions of
Section 7.12 of this agreement with respect to Withholding Advances or under
Section 20 of the Plan with respect to Tax Advances.
4.04 Partners' Accounts.
(a) Separate capital accounts shall be maintained for each Partner
consisting of all Capital Contributions made by such Partner, increased by the
amount of Partnership income and gain allocated to it pursuant to this agreement
and decreased by (i) the Fair Market Value of property (net of any liability
secured by such property that the Partner is considered to assume or take
subject to) and the amount of cash
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distributed to such Partner pursuant to this agreement and (ii) the amount of
Partnership losses and deductions allocated to it pursuant to this agreement.
(b) If any Partner has a deficit balance in its capital account
(after giving effect to all Capital Contributions, distributions and
allocations), such Partner shall have no obligation to make any contribution to
the capital of the Partnership by reason of such deficit.
4.05 Transfers or Conversions During Year. To avoid an interim
closing of the Partnership's books, the share of profits and losses under this
Article 4 of a Partner that assigns or otherwise makes a direct Transfer of part
or all of its Interest during any calendar year or is the assignee or transferee
of such a Partner or is issued any Class A Units during such calendar year
pursuant to the provisions of Section 5.01 or 5.02 or the Convertible Note
Documents or is issued any new Class A Units or Additional Equity Interest
pursuant to the provisions of subsection 4.02(a) during such calendar year shall
be determined by (i) in the case of any such assignment or other direct
Transfer, prorating (as between the transferor and its transferee) on a per-day
basis the total amount of the profits and losses of the Partnership attributable
to the Interest (or portion thereof) so transferred for such year and (ii) in
the case of any such issuance, by allocating the total amount of profits and
losses of the Partnership (other than items attributable to the capital stock of
SF Holdings and Florida Equity Corp., which shall be allocated in accordance
with the provisions of subsection 6.01(b)) on a per-day basis in accordance with
each Partner's Equity Interest in the Partnership (or otherwise as may be
required to give effect to the provisions of any Additional Equity Interests) as
of the end of such day.
ARTICLE 5 - CONVERSION RIGHTS
5.01 Class B-1 Unit Conversion. If and when SF Holdings' ownership
interest in the Disputed SF Cash ceases to be disputed by reason of the entry of
a final nonappealable order of the Bankruptcy Court or another court of
competent jurisdiction either (i) confirming SF Holdings' ownership interest in
the Disputed SF Cash or (ii) approving an executed and delivered settlement
agreement with Coopers & Xxxxxxx OYDL, or any successor in interest to Coopers &
Xxxxxxx OYDL, and SF Holdings shall have received payment of any funds in
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satisfaction of its claim to the Disputed SF Cash, the Managing General Partner
shall determine (which determination shall be confirmed in writing by the
Independent Accountants) the Fair Market Value (using an appropriate discount
rate in the event any payments are deferred for more than 30 days) of all funds
so received and to be received by SF Holdings pursuant to such order or
agreement, reduced by the sum of (A) the total liabilities of SF Holdings and
(without duplication) all costs of the Partnership and Persons Controlled by it
to realize such funds, including, without limitation, all applicable settlement
amounts or obligations, litigation costs and other out-of-pocket expenses of, or
funded by, the Partnership and Persons Controlled by it in respect of the
Disputed SF Cash or SF Holdings, plus (B) the amount, if any, previously
deducted from the Net MCJV Proceeds pursuant to subsection 5.03(b) (the Fair
Market Value of such funds, the "Net SF Cash"). Within thirty (30) Business Days
after the date (the "SF Deadline") that is last to occur of the date such court
order becomes final and nonappealable and receipt of such funds, the Managing
General Partner shall send (x) a notice to each other Partner setting forth such
determination and confirming the conversion that is contemplated in this Section
5.01 and (y) to each Partner that owned any Class B-1 Units a Unit Certificate
evidencing ownership of the Class A Units issued to such Partner upon such
conversion. Effective on and as of the SF Deadline, the then outstanding Class
B-1 Units shall, in the aggregate, automatically be converted into that number
of Class A Units (or that fraction of a Class A Unit) determined by dividing (1)
the Net SF Cash (subject to reduction pursuant to the provisions of subsection
5.03(a)), by (2) the Initial Unit Value, and each Partner that, immediately
preceding such conversion, held any Class B-1 Units shall be allocated in
respect thereof that number of such Class A Units determined by multiplying the
number of such Class A Units by a fraction, the numerator of which is the number
of Class B-1 Units held by such Partner immediately prior to such conversion and
the denominator of which is the total number of Class B-1 Units outstanding
immediately prior to such conversion.
5.02 Class B-2 Unit Conversion. If and when the Disputed MCJV
Recovery ceases to be disputed and there is received by the Partnership or any
Person that is wholly-owned by the Partnership the Partnership's or such
Person's share of the net cash proceeds of the MCJV Lands or the capital stock
of Florida Equity Corp., the Managing General Partner shall determine (which
determination shall be confirmed in writing by the Independent Accountants) the
amount of such proceeds, reduced
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by the sum of (A) the total liabilities of Florida Equity Corp. and (without
duplication) all costs of the Partnership and Persons Controlled by it to
realize such proceeds, including, without limitation, (i) the amount required to
be paid by the Partnership or Persons Controlled by it in accordance with the
Bank of Nova Scotia Settlement and (ii) any amounts funded by the Partnership or
Persons Controlled by it in respect of taxes, carrying costs and other out of
pocket expenses relating to the MCJV Lands (including, without limitation,
litigation and selling expenses) or Florida Equity Corp. or the liabilities
thereof, together with interest thereon at the rate of 10% per annum, compounded
annually, plus (B) the amount, if any, previously deducted from the Net SF Cash
pursuant to subsection 5.03(a) (such net amount, the "Net MCJV Proceeds").
Within thirty (30) Business Days after the day (the "MCJV Deadline") that is
last to occur of the entry of a final and nonappealable order of the Bankruptcy
Court approving the transaction that generates such proceeds, and receipt of
such proceeds, the Managing General Partner shall send (x) a notice to each
other Partner setting forth such determination and confirming the conversion
that is contemplated in this Section 5.02 and (y) to each Partner that owned any
Class B-2 Units a Unit Certificate evidencing ownership of the Class A Units
issued to such Partner upon such conversion. Effective on and as of the MCJV
Deadline, the then outstanding Class B-2 Units, in the aggregate, shall
automatically be converted into that number of Class A Units (or that fraction
of a Class A Unit) determined by dividing (x) the Net MCJV Proceeds (subject to
reduction pursuant to the provisions of subsection 5.03(b)), by (y) the Initial
Unit Value, and each Partner that, immediately preceding such conversion, held
any Class B-2 Units shall be allocated in respect thereof that number of such
Class A Units determined by multiplying the number of such Class A Units by a
fraction, the numerator of which is the number of such Class B-2 Units held by
such Partner immediately prior to such conversion and the denominator of which
is the total number of Class B-2 Units outstanding immediately prior to such
conversion.
5.03 Additional Conversion Adjustments.
(a) Notwithstanding the foregoing provisions of Section 5.01, if, on
the SF Deadline, a conversion of Class B-2 Units into Class A Units has not
already occurred, the Managing General Partner shall deduct from the amount of
Net SF Cash used in the formula described in Section 5.01 above the sum of (i)
all amounts funded by the Partnership or any Persons
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Controlled by it in respect of taxes, carrying costs and other out-of-pocket
expenses relating to the MCJV Lands or Florida Equity Corp. or the liabilities
thereof (including, without limitation, litigation and selling expenses),
whether or not funded in the form of loans, and (ii) the amount to be deposited
in a reserve to fund future litigation costs and other expenses of the type
referred to in the preceding clause (i) based on the Managing General Partner's
reasonable estimate of such costs and expenses. Any amounts to be reserved
pursuant to clause (ii) of the preceding sentence shall be subject to the
approval of the Bankruptcy Court.
(b) Notwithstanding the foregoing provisions of Section 5.02, if, on
the MCJV Deadline, a conversion of Class B-1 Units into Class A Units has not
already occurred, the Partnership shall deduct from the amount of Net MCJV
Proceeds used in the formula described in Section 5.02 above the sum of (i) all
amounts funded by the Partnership or any Persons Controlled by it in respect of
SF Holdings and the liabilities of SF Holdings (including, without limitation,
all applicable litigation and other out-of-pocket expenses relating to the
Disputed SF Cash or SF Holdings), whether or not funded in the form of loans,
and (ii) the amount to be deposited in a reserve to fund future litigation costs
and other expenses of SF Holdings while attempting to settle or litigate claims
relating to the Disputed SF Cash based on the Managing General Partner's
reasonable estimate of such costs and expenses. Any amounts to be reserved
pursuant to clause (ii) of the immediately preceding sentence shall be subject
to the approval of the Bankruptcy Court.
5.04 Net SF Cash and Net MCJV Proceeds. It is the intent of the
Partners that (i) the amount of the Net SF Cash should approximate the amount,
if any, by which the net worth of the Partnership, determined in accordance with
GAAP, as of the SF Deadline exceeds what the net worth of the Partnership,
determined in accordance with GAAP, would have been as of the SF Deadline if the
Partnership had never held any direct or indirect interest in SF Holdings, and
(ii) the amount of the Net MCJV Proceeds should approximate the amount, if any,
by which the net worth of the Partnership, determined in accordance with GAAP,
as of the MCJV Deadline, exceeds what the net worth of the Partnership,
determined in accordance with GAAP, would have been as of the MCJV Deadline if
the Partnership had never held any direct or indirect interest in Florida Equity
Corp. The provisions of Sections 5.01, 5.02 and 5.03 shall be construed and
enforced in a manner consistent with such intent.
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5.05 Convertible Note Documents. Contemporaneously with the
execution and delivery of this agreement, the Partnership is executing and
delivering the Convertible Note Documents. Upon the delivery of any Conversion
Notice and the satisfaction of any other conditions to exercise of the
Conversion Right by any holder of one or more Convertible Notes, the Managing
General Partner shall execute such instruments and take such other actions
(including, without limitation, issuance of one or more Unit Certificates) as
shall be necessary to evidence the conversion and issuance of Class A Units
contemplated by the Convertible Note Documents and such Conversion Notice.
5.06 Transfers Pursuant to JMB Agreement. Each of the Founding
Limited Partners shall make Transfers of Class B Units to JMB Partner at the
times and in the amounts required pursuant to the provisions of the JMB
Agreement.
ARTICLE 6 - PROFITS, LOSSES AND DISTRIBUTIONS
6.01 Profits and Losses.
(a) Subject to the provisions of subsection (b) of this Section
6.01, the Partnership's net profits or net losses shall be determined on an
annual basis and shall be allocated to the Partners or their assignees in
proportion to their Equity Interests; provided, however, that (i) to the extent
that the terms of any Additional Equity Interests require an allocation to the
holders of such Additional Equity Interests, the Managing General Partner shall
cause the allocations herein contemplated to take into account such terms (it
being understood that the allocations contemplated in this subsection 6.01(a) in
respect of any Class A Unit shall be the same as such allocations in respect of
each other Class A Unit) and (ii) except as expressly provided in subsection
7.02(b), no Limited Partner (in its capacity as a Limited Partner) shall be
personally liable for losses, costs, expenses, liabilities or obligations of the
Partnership in excess of its Capital Contributions under Article 4 hereof.
(b) Any income, gain, losses or deductions recognized by the
Partnership as a result of (i) the Disputed MCJV Recovery ceasing to be disputed
or as a result of any distribution with respect to, or disposition of, the stock
of Florida Equity Corp. shall be allocated to the holders of Class B-2 Units,
and (ii) the Disputed SF Cash ceasing to be disputed or as a result of any
distribution with respect to, or disposition
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of, the stock of SF Holdings shall be allocated to the holders
of Class B-1 Units.
6.02 Allocations for Tax Purposes.
(a) Subject to the provisions of subsection (b) of this Section
6.02, for income tax purposes, each item of income, gain, loss, deduction and
credit of the Partnership shall, subject to the provisions of Section 4.05, be
allocated among the Partners or their assignees in proportion to their Equity
Interests; provided, however, that (i) to the extent the terms of any Additional
Equity Interests require an allocation to the holders of such Additional Equity
Interests, the Managing General Partner shall cause the allocations herein
contemplated to take into account such terms (it being understood that the
allocations contemplated in this Section 6.02 in respect of any Class A Unit
shall be the same as such allocations in respect of each other Class A Unit) and
(ii) each such item with respect to property contributed to the Partnership by a
Partner or revalued pursuant to Treasury Regulations Section
1.704-1(b)(2)(iv)(f) shall be allocated among the Partners in a manner that
takes into account the variation between the adjusted tax basis of such property
and its book value, as required by Section 704(c) of the Code and Treasury
Regulations Section 1.704-1(b)(4)(i), using any method permitted by applicable
Treasury Regulations. Notwithstanding any contrary provision in this agreement,
(A) if requested by JMB Partner, the Partnership shall make or cause to be made
with respect to 000 Xxxx Xxxxxx the allocations contemplated in subsection
7.11(e) and (B) until such time as there shall occur a JMB Disqualification
Event, the allocations, debt sharing and other income tax treatments described
herein or in the JMB Agreement shall be complied with by the Partnership.
(b) Any income or gain recognized by the Partnership as a result of
the Disputed Realty Corp. Assets ceasing to be disputed or as a result of any
distribution with respect to, or disposition of, the stock of SF Holdings or of
Florida Equity Corp. shall be allocated to the holders of Class B-1 and Class
B-2 Units in accordance with the principles of Section 704(c) of the Code (it
being understood that, for book purposes, the initial Capital Contribution made
by the holders of Class B-1 and Class B-2 Units shall be fixed at the net value
of the stock of SF Holdings and the stock of Florida Equity Corp., respectively,
as and when the dispute affecting the value of each such asset is finally
resolved and such Class B Units are converted to Class A Units).
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6.03 Distributions. Annually, or at more frequent intervals as
determined by the Managing General Partner in its sole discretion, the then
Available Funds (as hereinafter defined) shall be distributed to the Partners or
their assignees in proportion to their Equity Interests; provided, however, that
to the extent that the terms of any Additional Equity Interests require
distribution of Available Funds to the holders of such Additional Equity
Interests in a particular order, ranking or amount, the Managing General Partner
shall cause the distribution of Available Funds to the holders of such
Additional Equity Interests to be in accordance with such terms (it being
understood that the distributions contemplated in this Section 6.03 in respect
of any Class A Unit shall be the same as such distributions in respect of each
other Class A Unit). "Available Funds" means (i) the Partnership's gross cash
receipts, less (ii) the Partnership's expenditures, less (iii) the amount that,
in the Managing General Partner's reasonable judgment, the Partnership should
retain or otherwise reserve in order to fulfill its business purposes or to
comply with the provisions of any debt or other obligation of the Partnership,
plus (iv) the amount by which, in the Managing General Part- ner's reasonable
judgment, any such reserve previously established and then existing shall be
reduced after taking into account the foregoing.
ARTICLE 7 - MANAGEMENT AND FINANCING MATTERS
7.01 Management of Business.
(a) Except as otherwise specifically provided to the contrary
herein, the Managing General Partner shall have full, exclusive and complete
discretion to manage the business and affairs of the Partnership and to take all
such actions as it deems necessary or appropriate to accomplish the purposes of
the Partnership as set forth herein; provided, however, that the actions of each
General Partner (to the extent such General Partner shall have any authority to
act for or on behalf of or to bind the Partnership on any matter) hereunder
shall at all times be in compliance with the provisions of Section 7.06. Nothing
contained in this Section 7.01 shall impose any obligation on any Person doing
business or dealing with the Partnership to inquire as to whether the Managing
General Partner has exceeded its authority in executing any contract, lease,
mortgage, note, deed or other instrument on behalf of the Partnership, and any
such Person shall be fully protected in relying upon the plenary authority of
the Managing General Partner.
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Except as otherwise provided in Article 8, each General Partner shall serve
without compensation for its services. Any General Partner may delegate such of
its respective powers and authority to managers, employees and agents of such
General Partner or of the Partnership as it shall deem necessary or appropriate
for the conduct of the Partnership's business; provided, however, that no
General Partner shall purport to authorize any such manager, employee or agent
to take any action that such General Partner is itself prohibited from taking
under the provisions of this agreement or (in the case of an Additional General
Partner) that such Additional General Partner has not been authorized to take
pursuant to the provisions of subsection 4.02(c).
(b) In carrying out the purposes of the Partnership, among other
things, the Managing General Partner is authorized to execute and deliver (i)
instruments evidencing the issuance of Class A Units or Additional Equity
Interests of the Partnership, (ii) all contracts, conveyances, assignments,
franchise agreements, licensing agreements and management contracts covering or
affecting the Partnership's assets, (iii) all checks, drafts and other orders
for the payment of the Partnership's funds, (iv) all promissory notes,
mortgages, deeds of trust, security agreements and other similar documents and
(v) all other instruments of any kind or character relating to the Partnership's
affairs, whether like or unlike the foregoing. No Partner other than the
Managing General Partner or any Additional General Partner (to the extent the
Managing General Partner shall have authorized such Additional General Partner
to act for or on behalf of or to bind the Partnership on any matter) shall have
any authority (actual or apparent) to act for or on behalf of or to bind the
Partnership.
(c) Meetings of the Partners may be called by the Managing General
Partner by giving ten (10) days prior written notice of the time, date, location
and purpose of the meeting; provided, however, that in the event of any
emergency affecting the Partnership or its assets, a meeting of the Partners may
be called by the Managing General Partner on such shorter notice as the Managing
General Partner shall deem appropriate in its reasonable judgment.
(d) Each Limited Partner or Additional General Partner may authorize
any Person or Persons, including, without limitation, the Managing General
Partner, to act for it by proxy on all matters on which a Limited Partner or
Additional General Partner may vote hereunder. Every proxy (i) must be
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signed by the Limited Partner or Additional General Partner or its
attorney-in-fact, (ii) shall expire eleven (11) months from the date thereof
unless the proxy provides otherwise and (iii) shall be revocable at the
discretion of the Limited Partner or Additional General Partner granting such
proxy.
(e) Any action required or permitted to be taken at a meeting of the
Partners may be taken without a meeting (and without advance notice thereof) if
a written consent setting forth the action to be taken is signed by the Partners
owning the percentage of the total Class A Units of the Partnership required to
take such action, which written consent may be evidenced in one or more
instruments. Consents need not be solicited from any other Partner if the
written consent of Partners owning such requisite percentage has been obtained
to take the action for which such solicitation was required.
(f) The Managing General Partner shall cause the Partnership to
perform its obligations under the JMB Agreement in accordance with the terms
thereof and shall not permit any Persons Controlled by the Partnership
(including, without limitation, New 245 Park LP) to take any actions that would
cause the Partnership to breach its obligations under the JMB Agreement.
7.02 No Management by Limited Partners; Limitation
of Liability.
(a) No Limited Partner, in its capacity as a limited partner, shall
take part in the day-to-day management, operation or control of the business and
affairs of the Partnership or have any right, power, or authority to act for or
on behalf of or to bind the Partnership or transact any business in the name of
the Partnership. Any approvals rendered or withheld by any of the Limited
Partners pursuant to this agreement shall be deemed as consultation with or
advice to the Managing General Partner in connection with the business of the
Partnership and, in accordance with the Act, shall not be deemed as
participation by any such Limited Partner in the business of the Partnership and
are not intended to create any inference that any such Limited Partner should be
classified as a general partner under the Act.
(b) No Limited Partner shall have any liability to any other Partner
or to the Partnership except (i) with respect to withholding under Section 7.12,
(ii) in connection with a breach or violation of any provision of this agreement
by such
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Limited Partner, (iii) in connection with a Tax Advance (but only to the extent
provided in Section 20.3.4 of the Plan) or (iv) as provided in the Act.
(c) No General Partner shall take any action that would subject any
Limited Partner (in its capacity as Limited Partner) to liability as a general
partner.
(d) No Limited Partner (in its capacity as such) may commence or
attempt to commence or join or attempt to join in any voluntary or involuntary
petition for bankruptcy or insolvency proceeding with respect to the Partnership
pursuant to the Bankruptcy Code. Neither the Partnership nor any General Partner
shall commence or consent to the commencement of any such proceeding unless the
commencement of such proceeding has been authorized by due corporate action of
the Managing General Partner.
7.03 Appointment of Agents, Officers or Representatives. The
Managing General Partner may appoint such agents, officers or representatives as
it deems appropriate, and may grant to them such titles or designations,
including, without limitation, that of President, Vice President, Managing Agent
or Managing Director, as it deems necessary or appropriate.
7.04 Title to Property; Nominee. All property owned by the
Partnership, whether real or personal, tangible or intangible, shall be deemed
to be owned by the Partnership as an entity, and no Partner, individually, shall
have any ownership of such property. Title to the Partnership's assets shall be
held in the Partnership's name or in the name of any nominee that the Managing
General Partner may designate. The Managing General Partner shall have the power
to enter into a nominee agreement with any such Person, and such agreement may
contain provisions indemnifying the nominee, except for his or its willful
misconduct.
7.05 Time Devoted to Business; Business with Related
Persons.
(a) The Managing General Partner shall devote such time to the
business of the Partnership as it in its discretion deems necessary for the
efficient operation of the Partner- ship's business.
(b) The Managing General Partner, in its discretion,
may cause the Partnership or any Person Controlled by the
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Partnership to transact business with any Affiliates or Related Persons of a
General Partner; provided, however, that, notwithstanding any provision to the
contrary in this agreement, except for agreements or arrangements that
constitute or are entered into in connection with the Implementing Transactions,
the Managing General Partner shall not cause or permit the Partnership or any
Person Controlled by the Partnership to enter into or suffer to exist any
transaction or series of related transactions with a General Partner or any
Related Person of a General Partner if such transaction or series of related
transactions is not on an Arm's-length Basis.
7.06 Fiduciary Duty; Exculpation. Each of the Managing General
Partner and each Additional General Partner (if any) having authority to act for
or on behalf of or to bind the Partnership shall act as a fiduciary for and in
the best interests of the Limited Partners and the Partnership; provided,
however, that (subject to the provisions of the proviso to subsection 7.05(b))
Affiliates or Related Persons of the General Partners shall at all times be free
to engage for their own account in all aspects of any business or investment in
which the Partnership is involved and may compete with the business and
investments of the Partnership; and provided, further, that neither the
foregoing provisions of this Section 7.06 nor any other provision hereof shall
be construed to require that the Managing General Partner or any Additional
General Partner having the authority to act for or on behalf of or to bind the
Partnership on any matter cause the Partnership to acquire any assets in
addition to its interest in the Core Properties or otherwise effect any other
expansion of the business of the Partnership, it being understood that any such
acquisition or other expansion shall be within the sole discretion of the
Managing General Partner or such Additional General Partner and that any such
acquisition or expansion will only be undertaken in compliance with all
applicable provisions of this agreement. No General Partner shall be liable,
responsible or accountable in damages or otherwise to the Partnership or any of
the other Partners for any act or omission performed or omitted in good faith on
behalf of the Partnership and in a manner reasonably believed to be (i) within
the scope of the authority granted by this agreement to such General Partner and
(ii) in the best interests of the Partnership. So long as any General Partner
shall not have violated the provisions of the proviso to the first sentence of
subsection 7.01(a) or the proviso to the last sentence of subsection 7.01(a),
such General Partner shall not be responsible for any misconduct or negligence
on the part of any agent (other than direct employees of such General Partner)
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if neither such General Partner nor any of its Related Persons derived any
improper personal benefit from such misconduct or negligence.
7.07 Indemnification.
(a) The Partnership shall indemnify and hold harmless each General
Partner and each other Person acting on behalf of the Partnership (an
"Indemnified Party") pursuant to the authority herein granted or otherwise (to
the extent such Indemnified Party is authorized to act), to the fullest extent
as would be permitted by applicable law of the State of Dela- ware affording
indemnification to persons acting on behalf of corporations organized in such
State (including, without limitation, any procedures set forth therein regarding
advancement of expenses to such Indemnified Party), from and against any and all
losses, claims, damages, liabilities, expenses (including, without limitation,
reasonable legal fees and expenses), judgments, fines, penalties, interests,
settlements and other amounts arising from any and all claims, demands, actions,
suits or proceedings, whether civil, criminal, administrative or investigative,
relating to the activities of such Indemnified Party on behalf of the
Partnership or as a result of its status as a Partner.
(b) The Partnership shall have the authority to purchase and
maintain such insurance policies on behalf of the Indemnified Parties as the
Managing General Partner shall determine, which policies may cover those
liabilities the Managing General Partner reasonably believes may be incurred by
an Indemnified Party in connection with the operation of the business of the
Partnership. The right to procure such insurance on behalf of the Indemnified
Parties shall in no way mitigate or otherwise affect the right of any such
Indemnified Party to indemnification pursuant to the provisions of subsection
7.07(a) hereof.
(c) The provisions of this Section 7.07 are for the benefit of the
Indemnified Parties, their heirs, successors, assigns and administrators and
shall not be deemed to create any rights in or benefit to any other Person.
7.08 Books and Records at Principal Place of Business. The Managing
General Partner shall cause the Partnership to maintain at its principal place
of business full and accurate books of the Partnership showing all receipts and
expenditures, assets and liabilities, profits and losses, and all
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other records necessary for recording the Partnership's business and affairs,
including, without limitation, the following:
(a) a current list in alphabetical order of the full
name and last known business street address of each
Partner;
(b) a copy of the Certificate and all amendments thereto, together
with (i) receipts of filing thereof, and (ii) executed copies of any
powers of attorney pursuant to which any amendment has been executed;
(c) copies of the Partnership's federal, state and
local income tax returns and reports, if any, for the
three most recent years; and
(d) copies of the Partnership's financial statements, if any, for
the three most recent years.
Such books shall be maintained separate from those of any other Person. Each
Partner or its authorized representative shall have, upon reasonable advance
notice in writing, at reasonable times and at such Partner's expense, the right
to review and make copies of such books and records and to receive true and
complete information regarding Partnership matters to the extent required (and
subject to the limitations) under Delaware law; provided, however, that the
Managing General Partner may impose reasonable limitations on the access of any
other Partner to such books and records to protect against disclosure of
proprietary or competitively sensitive information or to comply with the
confidentiality restrictions imposed in any agreement to which the Partnership
is a party. The Partnership shall not impose any service, administrative or
other charge upon any Partner exercising its rights under this Section 7.08
except for payment of the Partnership's reasonable costs of photocopying and
postage.
7.09 Annual Audit and Accounting. The books and records of the
Partnership shall be kept on the accrual basis of accounting in accordance with
generally accepted accounting principles ("GAAP"). The Partnership's accounting
period shall be the calendar year. The accounts of the Partnership shall be
audited annually by a nationally recognized accounting firm of independent
public accountants selected by the Managing General Partner (the "Independent
Accountants"). Each Additional General Partner and its designees shall be
entitled to confer with the Managing General Partner and the Partnership's
Independent
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Accountants with respect to any and all tax matters that may affect such
Partner, including, without limitation, in the case of JMB Partner, allocations
of indebtedness as contemplated in Section 6.02 and subsection 7.11(e).
7.10 Reports; Notices.
(a) The books of account shall be closed promptly after the close of
each calendar year, and the Managing General Partner shall prepare and send to
each Partner:
(i) Within ninety (90) days after the end of the fiscal year, an
Internal Revenue Service Schedule K-1 with respect to its distributive
share of income, gains, deductions, losses and credits for income tax
reporting purposes for each such fiscal year, together with any other
information concerning the Partnership reasonably necessary for the
preparation of a Partner's income tax return(s);
(ii) Within forty (40) days after the end of each of the first three
(3) fiscal quarters, as of the last day of the fiscal quarter, a report
containing unaudited financial statements of the Partnership and such
other information as may be legally required or determined to be
appropriate by the Managing General Partner; and
(iii) Within ninety (90) days after the end of the fiscal year, as of
the close of the fiscal year, an annual report containing audited
financial statements of the Partnership, presented in accordance with GAAP
and certified by the Independent Accountants.
(b) Except during such periods as the Partnership shall be subject
to the reporting requirements of the Securities Exchange Act of 1934, as
amended, the Managing General Partner shall give prompt written notice to each
other Partner upon (i) the effectiveness of any amendment to this agreement,
(ii) the Managing General Partner's obtaining knowledge of any material default
by the Partnership or a Person Controlled by the Partnership in respect of any
financing secured by any Core Property or other material real property of the
Partnership or any Person Controlled by the Partnership, (iii) the Managing
General Partner's obtaining knowledge of any facts or circumstances that
constitute a dissolution of the Partnership, (iv) the issuance of any amount of
Class A Units or Additional Equity Interests (other than a de minimis amount),
any
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recapitalization, merger or consolidation transaction to which the Partnership
becomes or is contemplated to become a party, (v) the taking of any action at a
meeting of the Partners or by a written consent signed by less than all the
Partners and (vi) the Managing General Partner's obtaining knowledge of any
other event or circumstance that, in the reasonable judgment of the Managing
General Partner, would be of material importance to the Partners. During such
periods as the Partnership shall be subject to the reporting requirements of the
Securities Exchange Act of 1934, as amended, the Managing General Partner shall
cause the Partnership to provide the information contemplated in clause (i) of
this subsection 7.10(b) and such information and notices to the Partners as the
Partnership shall be required to provide thereunder or under any other
applicable securities laws.
7.11 Tax Matters.
(a) The Managing General Partner shall be the Tax Matters Partner of
the Partnership for federal income tax matters pursuant to Code Section
6231(a)(7)(A). The Tax Matters Partner shall cause to be prepared all federal,
state and local income tax returns required of the Partnership at the Partner-
ship's expense. The Tax Matters Partner shall represent the Partnership (at the
expense of the Partnership) in connection with all examinations of the affairs
of the Partnership by any federal, state or local tax authorities, including,
without limitation, any resulting administrative and judicial proceedings, and
may expend funds of the Partnership for professional services and costs
associated therewith. The Partners shall, to the extent reasonably requested by
the Tax Matters Partner, cooperate (in all reasonable respects) with each other
in connection with the conduct of all proceedings pursuant to this subsection
7.11(a). The Tax Matters Partner shall provide notice to all "Notice Partners"
as provided in the Code.
(b) The Tax Matters Partner shall receive no compensation for its
services in such capacity. If the Tax Matters Partner incurs any costs related
to any tax audit, declaration of any tax deficiency or any administrative
proceeding or litigation involving any Partnership tax matter, such amount shall
be an expense of the Partnership and the Tax Matters Partner shall be entitled
to full reimbursement therefor.
(c) Except as otherwise set forth in this agreement,
the Tax Matters Partner shall determine whether to make (and,
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if necessary, revoke) any tax election available to the Partnership under the
Code or any state or local tax law.
(d) In the event that Treasury Regulations are adopted to replace or
supplement, with an elective regime, the existing Treasury Regulations for
classifying certain business organizations, the Tax Matters Partner shall elect
that the Partnership be treated as a partnership for federal income tax purposes
and take such other appropriate actions as shall be prescribed thereunder
consistent with such election.
(e) If requested by JMB Partner, the Partnership shall adopt and
shall cause New 245 Park LP and/or its designee(s) to adopt the "remedial
allocation method" under Treasury Regulations Section 1.704-3, with respect to
000 Xxxx Xxxxxx. The Partnership shall not permit any such remedial allocation
to be revoked or withdrawn so long as the Partnership continues to own the
ultimate beneficial ownership in 000 Xxxx Xxxxxx. If such remedial allocation
method is adopted, the Partners intend that:
(i) JMB Partner's share of the Partnership's liabilities secured by
000 Xxxx Xxxxxx will be approximately $145,000,000 (assuming JMB's Section
704(c) book/tax difference is $155,000,000 upon consummation of the Plan)
and will be subsequently adjusted only for those reductions required under
the remedial allocation method under Treasury Regulations Section 1.704-3.
To the extent that such book/tax difference is a different amount on the
date of this agreement, JMB Partner's share of the Partnership's
liabilities will be adjusted as provided under applicable Treasury
Regulations.
(ii) In addition to the liabilities described in clause (i) above,
from and after the date of this agreement (in accordance with the remedial
allocation method under Treasury Regulations Section 1.704-3), JMB
Partner's share of the Partnership's Section 752 liabilities shall be
equal to the product of (A) the total amount of the Partnership's Section
752 liabilities described under Treasury Regulation Section 1.752-3(a)(3)
and (B) JMB Partner's Equity Interest in the Partnership, as adjusted to
reflect the terms of any Additional Equity Interests and expressed as a
percentage of the total outstanding Equity Interests (it being understood
that this subsection 7.11(e)(ii) is intended to provide for the allocation
to
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JMB Partner of its share of Partnership liabilities under Treasury
Regulations Section 1.752-3(a)(3)).
(iii) All of the liabilities described in clauses (i) and (ii) above
will constitute and be reported as "qualified nonrecourse financing"
within the meaning of Section 465(b)(6) of the Code. Based on existing law
and regulations, in preparing any income tax return of the Partnership,
JMB Partner and New 245 Park LP, the Partnership shall not include, and
shall cause New 245 Park LP not to include, and JMB Partner shall not
include, any attachment or any statement that indicates that there is more
than one activity for purposes of Section 465 of the Code.
7.12 Withholding of Certain Amounts.
(a) The Managing General Partner may (in addition to amounts that
may be withheld pursuant to Section 9.11) withhold, in its discretion, from any
distribution of cash or property in kind to any other Partner or its assignee,
upon notice to such Partner pursuant to this agreement, the following amounts:
(i) any amounts due from such Partner or assignee to
the Partnership or the Managing General Partner under this
agreement; and
(ii) any amounts required (x) for the payment of any taxes that the
Managing General Partner determines in good faith must be withheld by the
Partnership with respect to such Partner or assignee or (y) to pay or
reimburse the Managing General Partner for any advances made by the
Managing General Partner for such purpose.
(b) Any amounts withheld pursuant to this Section 7.12 shall be
applied by the Managing General Partner to discharge the obligation in respect
of which such amounts were withheld. All amounts distributable to any Partner or
assignee that are withheld pursuant to this Section 7.12 shall be treated as
amounts distributed to such Partner or assignee. To the extent that any amount
paid over (or required to be paid over) in satisfaction of any obligation
described in clause (i) or clause (ii) of subsection 7.12(a) exceeds the amount,
if any, actually withheld from a distribution that otherwise would have been
made to a Partner or assignee, such excess shall be treated as an interest-free
advance to such Partner or
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assignee, secured by such Partner's or assignee's Interest in the Partnership
(such loan, a "Withholding Advance"). Amounts treated as advanced to any Partner
or assignee pursuant to this Section 7.12 shall be repaid by such Partner or
assignee to the Partnership within thirty (30) Business Days after the Managing
General Partner gives notice to such Partner or assignee making demand therefor.
If any Partner or assignee of a Partner fails to pay a Withholding Advance as
provided in this subsection 7.12(b), the Partnership (without limiting any other
remedy that may be available to the Partnership) shall collect any unpaid
amounts from any Partnership distributions to such Partner or assignee that
otherwise would be made to such Partner or assignee and/or permanently adjust
the Interest of such Partner or assignee accordingly. Notwithstanding anything
to the contrary set forth herein, in the event of any failure by a Partner or
assignee to perform its obligations under this Section 7.12, in addition to all
other rights and remedies available hereunder or under applicable law to the
Partnership and the Managing General Partner, the Managing General Partner and
the Partnership shall have all the rights and remedies of a secured creditor
under the Uniform Commercial Code as in effect in the State of Delaware.
(c) If the Managing General Partner determines that the Partnership
would have insufficient funds (taking into account the cash needs of Persons
Controlled by the Partnership) to make a Withholding Advance, the Managing
General Partner shall be entitled to require the Partner for which the
withholding requirement applies to pay the amount of such withholding
requirement sufficiently in advance of the payment date to permit the
Partnership timely to satisfy its withholding tax liability.
ARTICLE 8 - COMPENSATION
8.01 No Entitlement to Compensation. No Partner acting on behalf of
the Partnership shall be entitled to compensation or remuneration from the
Partnership for acting as a Partner except as may be specifically provided in
this agreement. The provisions of this Section shall not limit any compensation
or remuneration that any Partner shall receive from any other Person with which
the Partnership may be an Affiliate or in which the Partnership is a participant
or partner.
8.02 Reimbursement. The Partnership shall reimburse
each General Partner for all reasonable and customary out-of-
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pocket expenses incurred by it in managing or otherwise acting on behalf of the
Partnership. If the Managing General Partner shall determine to engage the
services of a general manager or agent or advisor to provide management or
advisory or similar services to the Partnership, the reasonable and customary
fees and expenses of such manager, agent or advisor shall be paid by the
Partnership.
ARTICLE 9 - TRANSFERS
9.01 Certain Transfers Void. No Partner may make or permit to occur
any Transfer of all or any part of its Interest in the Partnership except in
accordance with the provisions of this Article 9. Any purported Transfer in
violation of this Article 9 shall not bind the remaining Partners, who may
continue to treat the original Partner as the owner of such Interest (or the
applicable portion thereof) for all purposes.
9.02 Certain Prohibitions on Transfers. Except with the prior
written consent of the Required Founding Limited Partners (which may be withheld
for any reason or no reason), no Partner shall make or permit to occur any
Transfer of all or any part of its Interest (other than a Transfer that does not
violate the provisions of Section 9.05, Section 9.08 or Section 9.09 and is (i)
required pursuant to Section 5.06 hereof, (ii) a Transfer to a Wholly Owned
Affiliate of such Partner, (iii) a Transfer by Dragon Partner to a Person within
the Dragon Control Group, or (iv) a Transfer of any Unrestricted Units that may
be owned by it) or enter into any contract therefor during the period commencing
on the date hereof and ending on the third anniversary of the date hereof.
Commencing after the third anniversary of the date hereof, without the consent
of any other Partner, each Partner may, at any time, subject only to the
provisions of Section 9.05, Section 9.08 and Section 9.09, make or permit to
occur any Transfer to any Person of all or any part of its Interest; provided,
however, that no assignee of a Partner (other than any assignee of Unrestricted
Units acquired in a transaction that complies with the provisions of Section
9.03) shall be admitted as a Partner of the Partnership except in compliance
with the provisions of Section 9.04. Without the consent of any other Partner,
each Partner that is the holder of Unrestricted Units may, at any time, subject
only to the provisions of Section 9.05, Section 9.08 and Section 9.09, make or
permit to occur any Transfer to any Person of all or any portion of such
Unrestricted Units.
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9.03 Transfers by Certain Partners. Upon any assignment by a Partner
of Unrestricted Units that does not violate the provisions of Section 9.05,
Section 9.08 or Section 9.09, the transferee thereof shall be admitted to the
Partnership as a Partner upon receipt of a Transfer Application with respect to
such Transfer by the Managing General Partner. Except as provided in subsection
4.02(e), each such transferee shall have all the rights as a Partner of the
Partnership that were possessed by its transferor.
9.04 Approval of Managing General Partner.
(a) Other than as set forth in Section 9.03, no assignee of all or
any part of a Partner's Interest (including, without limitation, an assignee
that is a non-United States Person) shall be admitted as a Partner without the
consent of the Managing General Partner, which consent may be withheld in the
sole and absolute discretion of the Managing General Partner; provided, however,
that if, at the time of any request for consent hereunder, the direct or
indirect beneficial Interest in the Partnership of the requesting Partner and
all its Affiliates shall exceed 50% of the aggregate Equity Interests in the
Partnership, no assignee of such Partner may be admitted as a Partner of the
Partnership unless non-transferring Partners (which may include non-transferring
Partners holding Unrestricted Units that decline to participate in a Tag-Along
Sale) holding aggregate Equity Interests constituting a majority in interest of
all non-transferring Partners shall consent thereto (which consent may be
withheld in their sole and absolute discretion). Pending an assignee's admission
as a substitute Partner of the Partnership, and upon receipt of written notice
by the Managing General Partner of the assignment, such assignee shall be
entitled to share in all allocations and distributions of the Partnership
(including, without limitation, liquidating distributions) on the same basis as
the Partner from which such assignee obtained its Interest. Unless and until
such assignee is admitted as a substitute Partner, such assignee shall not be
entitled to exercise any other rights of a Partner, including, without
limitation, the right to vote (to the extent such right was available to such
assignee's predecessor) on any matter submitted to the Partners for approval,
and such predecessor shall retain the right, if any, to vote the Interest so
assigned.
(b) The restriction on substitution with respect to assignees
contained in this Section 9.04 shall be of no further force or effect if (i)
Treasury Regulations are adopted to
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replace or supplement, with an elective regime, the existing Treasury
Regulations for classifying certain business organizations, (ii) any required
elections are made thereunder to treat the Partnership as a partnership for
federal income tax purposes and (iii) the elimination of such restriction does
not (in the reasonable judgment of the Managing General Partner) adversely
affect the partnership status of the Partnership from its inception.
9.05 Certain Prohibited Transfers.
(a) No Partner shall assign all or any part of its Interest to any
Person that is not a "United States person" within the meaning of section
7701(a)(30) of the Code, without the prior written consent of the Managing
General Partner, which consent shall be granted if (i) such Person can
demonstrate, to the reasonable satisfaction of the Managing General Partner, its
ability to satisfy its potential liabilities for any withholding tax that may be
imposed on its pro rata share of the Partnership's income and (ii) the Managing
General Partner determines that the withholding obligations to which the
Partnership reasonably may be expected to be subject as a result of the
ownership of such Interest by such assignee, when taken together with such
withholding obligations with respect to all other Interests held by non-United
States persons, would not have a material adverse effect on the ability of the
Partnership and Persons Controlled by it to satisfy their debt service
requirements and other contractual obligations and operational requirements.
Notwithstanding the foregoing, the Managing General Partner shall provide the
consent contemplated in this subsection 9.05(a) in respect of (A) the assignment
by Coopers & Xxxxxxx OYDL of any Class A Units received by it to the Class 28
creditors of Olympia & York Developments Limited, pursuant to the provisions of
the Plan of Arrangement of Olym- pia & York Developments Limited, et al. filed
under the Compa- xxxx' Creditors Arrangement Act, (B) any request by JMB Partner
to assign all or any part of its Class A Units to a JMB Controlled Affiliate or
the members of JMB Partner and (C) any request by JMB (as a substituted Partner
or assignee of JMB Partner following any assignment described in the immediately
preceding clause (B)) to assign all or any part of its Class A Units to its
partners and (D) any assignment by the Disbursing Agent (as defined in the Plan)
made pursuant to Section 20.4 of the Plan.
(b) No assignment of all or any part of any Interest
shall be effective without the approval of the Managing General
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Partner if the Interest sought to be assigned, when added to the total of all
other Interests assigned (or approved for assignment), would result in a
"termination" of the Partnership under section 708 of the Code. The Managing
General Partner shall give notice to all other Partners in the event that sales
or exchanges should be suspended for such reason. Any sales or exchanges
deferred by reason of any such determination by the Managing General Partner
shall be made in chronological order to the extent practicable commencing on
such date as shall be determined by the Managing General Partner.
Notwithstanding anything to the contrary contained in this agreement, the
Founding Limited Partners shall not, prior to the date that is six months after
the date of this agreement, make any assignments of all or any part of their
Interests that would cause any delay in the ability of a Limited Partner to
assign any Unrestricted Units or a delay in the ability of the Disbursing Agent
to make any distributions required pursuant to Section 20.4 of the Plan.
(c) No Transfer by the Managing General Partner shall be permitted
that would cause the Managing General Partner to have less than a 1% interest in
the capital of, and in all items of income, gain, loss, deduction and credit of,
the Partnership.
(d) No assignment of all or any part of an Interest (other than an
assignment of Unrestricted Units) may be made if such assignment would result in
the Partnership being treated as a corporation for tax purposes.
(e) No assignment of all or any part of an Interest representing
more than 6% of the total Equity Interest or the total Additional Equity
Interests (of any class or series) may be made or effective unless the
Partnership shall have been given notice thereof not less than five (5) Business
Days prior to the effective date of such assignment.
9.06 Successor Managing General Partner; Removal of
Managing General Partner.
(a) Upon the occurrence of an event described in
subsection 10.01(c), the Managing General Partner shall (i)
remain liable for all obligations and liabilities (other than
Partnership liabilities payable solely from Partnership assets)
incurred by it as a General Partner before the effective date
of such event and (ii) pay all costs associated with the admis-
sion of its successor Managing General Partner. The Managing
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General Partner shall be free of and held harmless by the Partnership against
any obligation or liability incurred on account of the activities of the
Partnership from and after the effective date of such event.
(b) A successor to all of the Managing General Part- ner's Interest
that is proposed to be admitted to the Partnership as a successor Managing
General Partner shall be admitted as the Managing General Partner, effective
upon the assignment of such Interest to such proposed successor, upon the
approval of Partners (the "Required Partners") constituting (i) the Required
Founding Limited Partners and (ii) the holders of not less than 75% of all the
Equity Interests and 75% of all Additional Equity Interests (if any are then
outstanding). Any such assignee shall carry on the business of the Partnership
without dissolution. Prior to its admission to the Partnership, such assignee
shall have provided to the Partners such information as to the identity of its
Affiliates and its finances and business and those of its Affiliates as may be
reasonably requested in writing by any Partner. In connection with the admission
of such assignee to the Partnership, such assignee shall agree in writing to be
bound by all the terms and provisions of this agreement.
(c) The Managing General Partner may be removed and a replacement
Managing General Partner admitted to the Partnership upon the affirmative vote
of the Required Partners; provided, however, that the rights of the Partners
under this subsection (c) to remove the Managing General Partner and elect a
replacement therefor shall not be effective unless and until (i) the Partnership
has received an opinion of counsel, which counsel is satisfactory to a majority
in interest of the Limited Partners, as to the legality of such action, and (ii)
either (A) the Partnership has received an opinion of counsel, which counsel is
satisfactory to the Required Partners, that such action may be effected without
subjecting any of the Limited Partners to liability as general partners under
the Act or under the laws of such other jurisdictions in which the Partnership
is formed, re-formed, re-organized or otherwise qualified, or (B) a Delaware
court having original jurisdiction in the premises has entered a judgment which
has become final to the foregoing effect as to the Act and an opinion of counsel
as provided above has been obtained as to the laws of such jurisdictions, other
than Delaware, in which the Partnership is formed, re-formed, re-organized or
otherwise qualified.
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9.07 Successor Partners. In the event of a Bankruptcy of a Limited
Partner, the bankruptcy trustee or administrator of such Limited Partner shall
succeed to its Interest. If an individual Limited Partner dies, his executor or
administrator shall succeed to his Interest. If a Limited Partner that is a
natural Person shall be adjudicated insane, incompetent or incapacitated, his
committee, guardian or conservator shall succeed to his Interest.
9.08 Tag-Along Provisions.
(a) If at any time any Partner alone or together with any other
Partners (such Partner or Partners, "Tag-Along Sellers") propose to enter into
an agreement (or substantially contemporaneous agreements, whether or not with
the same or affiliated parties) to sell or otherwise dispose of for value to any
Person or Group, other than, in each case, a Wholly Owned Affiliate of such
Partner or Partners (a "Tag-Along Purchaser"), a Majority Interest in one or
more related transactions (such sale or other disposition for value being
referred to as a "Majority Tag-Along Sale"), then such Tag-Along Sellers shall
afford each other Partner that owns any Unrestricted Units (each, individually,
a "Tag-Along Partner" and, collectively, the "Tag-Along Partners") the
opportunity to participate proportionately with respect to its Unrestricted
Units in such Majority Tag-Along Sale in accordance with the provisions of this
Section 9.08. If at any time any Tag-Along Sellers propose to enter into an
agreement (or substantially contemporaneous agreements, whether or not with the
same or affiliated parties) to sell or otherwise dispose of for value to any
Tag- Along Purchaser a Qualifying Interest in one or more related transactions
(such sale or other disposition for value being referred to as a "Qualifying
Tag-Along Sale"), then such Tag- Along Sellers shall afford each of (i) JMB
Partner (but only if the Equity Interest of JMB Partner, as of the close of
business on the day immediately prior to the Tag-Along Notice Date (as
hereinafter defined) has not fallen below 40% solely by reason of an issuance of
Class A Units or Additional Equity Interests occurring after the date hereof)
and (ii) each other Tag-Along Partner holding as of the close of business on the
day immediately prior to the Tag-Along Notice Date Unrestricted Units
representing at least 4% of the total Equity Interests then outstanding the
opportunity to participate proportionately in such Qualifying Tag-Along Sale in
accordance with the provisions of this Section 9.08; provided, however, that if
any Partner shall have at any time exercised its tag-along rights pursuant to
the provisions of this Section 9.08, such
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exercise(s) resulting in the sale or disposition of a portion, but not all, of
such Partner's Unrestricted Units, such Partner shall thereafter continue to be
entitled to exercise its tag- along rights with respect to its remaining
Unrestricted Units in connection with any subsequent Qualifying Tag-Along Sale
notwithstanding that, as of the close of business on the day immediately prior
to the Tag-Along Notice Date relating to such subsequent Qualifying Tag-Along
Sale, such Partner does not own Unrestricted Units representing at least 4% of
the total Equity Interests then outstanding; and provided, further, that in
negotiating a Tag-Along Sale, the Tag-Along Sellers shall provide that no
Tag-Along Partner shall be required to make any representation, covenant or
warranty in connection with the Tag-Along Sale, other than representations and
warranties as to its valid existence and its ownership, authority and agreement
to sell, free of liens, claims, encumbrances or any right of set off, the
Unrestricted Units proposed to be sold by it.
(b) The relevant Tag-Along Sellers shall provide each Tag-Along
Partner entitled to participate in such Tag- Along Sale pursuant to the
provisions of subsection 9.08(a) hereof and the Managing General Partner with
written notice (the "Tag-Along Sale Notice") not more than sixty (60) days nor
less than twenty (20) days prior to (the date of such Tag-Along Sale Notice
being the "Tag-Along Notice Date") the proposed date of the Tag-Along Sale (the
"Tag-Along Sale Date"). Each Tag-Along Sale Notice shall be accompanied by a
copy of any written agreement relating to the Tag-Along Sale (redacted to the
extent necessary to comply with any applicable confidentiality restriction but
not so as to eliminate any information otherwise required to be provided below)
and shall set forth: (i) the name and address of each proposed Tag-Along
Purchaser of Equity Interests in the Tag-Along Sale, (ii) the total percentage
of Equity Interests (computed on a basis that assumes all then outstanding
Convertible Notes (exclusive of any accrued interest in respect thereof) have
been converted into Class A Units) proposed to be Transferred by such Tag-Along
Sellers (the "Original Sale Percentage"), (iii) the proposed amount of
consideration to be paid for such Equity Interests, which consideration may only
be paid in cash, and the terms and conditions of payment offered by each
proposed Tag-Along Purchaser, (iv) the Tag-Along Sale Date and (v) the name and
address of each Tag-Along Seller.
(c) Any Tag-Along Partner entitled to participate in the relevant
Tag-Along Sale pursuant to the provisions of subsection 9.08(a) hereof wishing
to participate in the Tag-Along
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Sale shall provide written notice (the "Tag-Along Notice") to the relevant
Tag-Along Sellers no less than five (5) Business Days prior to the Tag-Along
Sale Date. The Tag-Along Notice shall set forth the maximum number of Class A
Units that such Tag-Along Partner elects to include in the Tag-Along Sale. The
Tag-Along Notice given by any Tag-Along Partner shall constitute such Tag-Along
Partner's binding agreement (subject only to receipt of any necessary consent
pursuant to subsection 9.05(b)) to sell the Unrestricted Units specified in the
Tag- Along Notice on the terms and conditions applicable to the Tag- Along Sale;
provided, however, that in the event that there is any material change in the
terms and conditions of such Tag- Along Sale applicable to the Tag-Along Partner
(including, without limitation, any decrease in the purchase price that occurs
other than pursuant to an adjustment mechanism set forth in the agreement
relating to the Tag-Along Sale or any failure to consummate the Tag-Along Sale
within ninety (90) days after the Tag-Along Sale Date) after such Tag-Along
Partner gives its Tag-Along Notice, then, notwithstanding anything herein to the
contrary, the Tag-Along Partner shall have the right to withdraw from
participation in the Tag-Along Sale with respect to all of its Unrestricted
Units affected thereby. If the proposed Tag-Along Purchaser does not agree to
consummate the purchase for cash consideration of all of the Unrestricted Units
requested to be included in the Tag-Along Sale by the Tag-Along Partners on the
same terms and conditions applicable to the proposed purchase of the Original
Sale Percentage of the Tag- Along Sellers, then such Tag-Along Sellers shall not
consummate the Tag-Along Sale of any of their Equity Interests to such Tag-Along
Purchaser unless the number of Class A Units of each Tag-Along Partner to be
purchased by the Tag-Along Purchaser in such Tag-Along Sale shall not be reduced
below the Adjusted Tag-Along Amount in respect thereof, and all other terms and
conditions of the Tag-Along Sale are the same for such Tag- Along Sellers and
the Tag-Along Partners (except as otherwise provided in the last proviso to
subsection 9.08(a)).
If a Tag-Along Notice from any Tag-Along Partner is not given by
such Tag-Along Partner no less than five (5) Business Days prior to the Tag
Along Sale Date period specified above, such Tag-Along Sellers shall have the
right to consummate the Tag-Along Sale without the participation of such Tag-
Along Partner, but only on terms and conditions which are no more favorable in
any material respect to such Tag-Along Sellers (and in any event, at no greater
a purchase price, except as the purchase price may be adjusted pursuant to the
agreement relating to the relevant Tag-Along Sale) than as stated in the
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Tag-Along Sale Notice and only if such Tag-Along Sale is consummated on a date
within sixty (60) days of the Tag-Along Sale Date. If such Tag-Along Sale is not
consummated within such sixty (60) day period, the Equity Interests that were to
be subject to such Tag-Along Sale thereafter shall continue to be subject to all
of the restrictions contained in this Section 9.08.
(d) On the date of closing of a Tag-Along Sale, each Tag-Along
Partner shall deliver such documentation, certificates or other instruments with
respect to the Unrestricted Units to be sold by it in connection with the
Tag-Along Sale as may be reasonably required for the Transfer of such
Unrestricted Units to the relevant Tag-Along Purchaser, against delivery of the
purchase price for such Unrestricted Units (net of any amounts of federal or
state taxes such Tag-Along Purchaser is required by law to withhold from such
purchase price).
(e) If, by reason of the operation of subsection 9.05(b), the
Transfer of any Unrestricted Units to be sold as part of a Tag-Along Sale is
deferred and the Tag-Along Purchaser in respect of such Tag-Along Sale agrees to
consummate such Tag-Along Sale in stages, each Tag-Along Partner participating
in such Tag-Along Sale shall be entitled to Transfer to the Tag-Along Purchaser
a pro rata portion (based on the respective amounts of Class A Units to be sold
in such Tag-Along Sale by such Tag-Along Partner and all other Partners) of its
Unrestricted Units at each time that the Selling Partner Transfers any of its
Class A Units to such Tag-Along Purchaser.
(f) The closing of any Transfer of any Unrestricted Units pursuant
to this Section 9.08 shall take place at the offices of the Partnership (or at
such other location as shall reasonably be designated by the Managing General
Partner) concurrently with the closing of any sale by the Tag-Along Sellers to
the Tag-Along Purchaser.
9.09 Transfers Must Comply with Laws. Notwithstanding any contrary
provision herein, no Partner may Transfer or offer to Transfer all or any part
of its Interest (or solicit any offers to Transfer any Interest), and no
Transfer, offer to Transfer or solicitation of offers to Transfer all or any
part of its Interest otherwise permitted hereunder shall be permitted, if such
Transfer offer or solicitation would violate the registration requirements of
the Securities Act of 1933, as
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amended, and rules and regulations promulgated thereunder or the registration
requirements of any applicable state securities laws and rules and regulations
promulgated thereunder.
9.10 Assumption by Transferee. Except as otherwise provided in
Section 9.03, the admission of any Person as a Partner of the Partnership under
Section 9.04 shall be conditioned on such Person executing documents reasonably
required by the Managing General Partner for such Person to assume the
obligations of its transferor hereunder.
9.11 Remedies for Impermissible Transfer. Without limiting any other
remedies available to the Partnership or any of the other Partners, upon any
breach by a Partner of its obligations under this Article 9, the Managing
General Partner may, and, upon written demand of Partners owning Equity
Interests aggregating at least 20% of all the Equity Interests in the
Partnership, shall, so long as any breach by such Partner of its obligations
under such Article shall be continuing, withhold distributions of Available
Funds to such Partner.
9.12 Certificates. Upon the Partnership's issuance of any Class A
Units to any Person, the Partnership shall issue one or more Unit Certificates
in the name of such Person evidencing the number of such Class A Units being so
issued. Unit Certificates shall be executed on behalf of the Partnership by the
Managing General Partner. No Unit Certificate shall be valid for any purpose
until it has been countersigned by the Transfer Agent.
9.13 Mutilated, Destroyed, Lost or Stolen Unit
Certificates.
(a) If any mutilated Unit Certificate is surrendered to the Transfer
Agent, the Managing General Partner shall execute, and the Transfer Agent shall
countersign and deliver in exchange therefor, a new Unit Certificate evidencing
the same number of Class A Units as the Unit Certificate so surrendered.
(b) The Managing General Partner shall execute, and the Transfer
Agent shall countersign and deliver a new Unit Certificate in place of any Unit
Certificate previously issued if the Record Holder of the Unit Certificate:
(i) makes proof by affidavit, in form and sub-
stance satisfactory to the Managing General Partner, that
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a previously issued Unit Certificate has been lost,
destroyed or stolen;
(ii) requests the issuance of a new Unit Certificate before the
Partnership has notice that the Unit Certificate has been acquired by a
purchaser for value in good faith and without notice of an adverse claim;
(iii) if requested by the Partnership, delivers to the Managing
General Partner a bond, in form and substance satisfactory to the Managing
General Partner, with surety or sureties and with fixed or open penalty as
the Managing General Partner may reasonably direct, in its sole
discretion, to indemnify the Partnership, the Partners and the Transfer
Agent against any claim that may be made on account of the alleged loss,
destruction or theft of the Unit Certificate; and
(iv) satisfies any other reasonable requirements
imposed by the Managing General Partner.
(c) As a condition to the issuance of any new Unit Certificate under
this Section 9.13, the Partnership may require the payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including, without limitation, the fees and
expenses of the Transfer Agent) reasonably connected therewith.
9.14 Record Holders. The Partnership shall be entitled to recognize
the Record Holder as the Partner or assignee of a Partner with respect to any
Interest and, accordingly, shall not be bound to recognize any equitable or
other claim to or interest in such Interest on the part of any other Person,
regardless of whether the Partnership shall have actual or other notice thereof,
except as otherwise provided by law or any applicable rule, regulation,
guideline or requirement of any national securities exchange on which the Class
A Units may be listed for trading. Without limiting the foregoing, when a Person
(such as a broker, dealer, bank, trust company or clearing corporation or an
agent of any of the foregoing) is acting as nominee, agent or in some other
representative capacity for another Person in acquiring and/or holding Class A
Units, as between the Partnership on the one hand, and such other Persons on the
other, such representative Person (i) shall be the Partner or assignee of a
Partner (as the case may be) of record and beneficially, and (ii) shall be bound
by this agreement and
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shall have the rights and obligations of a Partner or assignee of a Partner (as
the case may be) hereunder and as provided for herein. The foregoing provisions
of this Section 9.14 shall not affect the meaning or interpretation of any other
provision of this agreement that refers to "indirect" or "beneficial" ownership.
9.15 Registration of Transfer of Class A Units.
(a) The Partnership shall keep or cause to be kept on behalf of the
Partnership a register in which, subject to such reasonable regulations as it
may prescribe, the Partnership will provide for the registration of Transfers of
Class A Units. The Transfer Agent is hereby appointed registrar and transfer
agent for the purpose of registering Class A Units and Transfers of Class A
Units as herein provided. The Partnership shall not recognize Transfers of Unit
Certificates representing Class A Units unless such Transfers are effected in
the manner described in this Section 9.15. Upon surrender for registration of
transfer of any Class A Units evidenced by a Unit Certificate, and subject to
the provisions of subsection 9.15(b), the Managing General Partner shall
execute, and the Transfer Agent shall countersign and deliver, in the name of
the holder or the designated transferee or transferees, as required pursuant to
the holder's instructions, one or more new Unit Certificates evidencing the same
aggregate number of Class A Units as was evidenced by the Unit Certificate so
surrendered.
(b) Except as otherwise provided in Section 9.14, the Partnership
shall not recognize any Transfer of Class A Units until the Unit Certificates
evidencing such Class A Units are surrendered for registration of Transfer and
such Unit Certificates are accompanied by a Transfer Application duly executed
by the transferee (or the transferee's attorney-in-fact duly authorized in
writing). Each Unit Certificate surrendered for registration of Transfer shall
be cancelled by the Transfer Agent. No charge shall be imposed by the
Partnership for such Transfer; provided, however, that as a condition to the
issuance of any new Unit Certificate under this Section 9.15, the Partnership
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed with respect thereto.
(c) A transferee who has completed and delivered a Transfer
Application shall be deemed to have (i) requested admission to the Partnership
as a Limited Partner (unless its transferor is a General Partner, it elects in
writing to be a
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General Partner and, pursuant to all applicable provisions of this agreement
(including, without limitation, the provisions of subsection 4.02(e), such
transferee is entitled to be admitted as a General Partner), (ii) agreed to be
bound by this agreement as a Limited Partner or (if such transferee has made an
election as contemplated in clause (i) above) General Partner having the same
obligations hereunder as were held by its transferor; provided, however, that no
such transferee shall be bound by any amendment to this agreement of the
character described in the first proviso to subsection 11.01(b) unless such
amendment was approved by its transferor, (iii) represented and warranted that
such transferee has the right, power and authority and, if a natural Person, the
capacity to enter into this agreement, and (iv) granted the powers of attorney
set forth in this agreement.
ARTICLE 10 - DISSOLUTION AND TERMINATION
10.01 Events of Dissolution. The Partnership shall continue until
December 31, 2095 unless sooner dissolved by:
(a) the affirmative vote of Partners constituting (i) the Required
Founding Limited Partners and (ii) the holders of not less than two-thirds of
all the Equity Interests then outstanding and not less than two-thirds of all
Additional Equity Interests then outstanding (if any);
(b) any event which makes it unlawful for the busi-
ness of the Partnership to be carried on by the Partners;
(c) the death, withdrawal, retirement, resignation, expulsion,
Bankruptcy, liquidation or dissolution of the Managing General Partner or the
occurrence of any other event that terminates the continued membership of the
Managing General Partner as a general partner of the Partnership; provided,
however, that the Managing General Partner shall neither withdraw, retire or
resign from the Partnership nor liquidate, dissolve or effect or permit any act
or event constituting the Bankruptcy of the Managing General Partner, in each
case unless a successor managing general partner shall have been, or
contemporaneously is being, admitted to the Partnership in accordance with
Section 10.02 of this agreement;
(d) the death, withdrawal, retirement, expulsion, Bankruptcy,
liquidation, or dissolution of any Additional General Partner or the occurrence
of any other event that
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terminates the continued membership of any Additional General Partner as a
general partner of the Partnership, unless at the time there is a Managing
General Partner (it being understood that, if there is a Managing General
Partner existing at the time of any such event, the Managing General Partner
shall carry on the business of the Partnership and the Partnership shall not be
dissolved, with the result that, in such circumstances, action pursuant to
Section 10.02 hereof shall not be necessary to continue the business of the
Partnership);
(e) the entry of a decree of judicial dissolution of
the Partnership under the Act; or
(f) the sale, exchange or other disposition of all
or substantially all of the Partnership's assets.
10.02 Continuance of the Partnership. Notwithstanding the provisions
of Section 10.01, upon the occurrence of an event described in subsection
10.01(c) or (if, at the applicable time, there shall be no Managing General
Partner) subsection 10.01(d) hereof, the remaining Partners shall have the right
to continue the business of the Partnership. Such right may be exercised only by
the affirmative vote of the Required Partners, within 90 days after the
occurrence of an event described in subsection 10.01(c) or (if, at the
applicable time, there shall be no Managing General Partner) subsection 10.01(d)
hereof, to continue the business of the Partnership and the selection of a
successor Managing General Partner under the terms of Section 9.06. If not so
exercised, the right of the Partners to continue the business of the Partnership
shall expire and the Partnership's affairs shall be wound up as provided in
Section 10.03.
10.03 Liquidation of Partnership Assets.
(a) Subject to the provisions of subsection 10.03(e), in the event
of dissolution pursuant to Section 10.01, the Partnership shall continue solely
for purposes of winding up the affairs of, achieving a final termination of, and
satisfaction of the creditors of, the Partnership. The Managing General Partner
(or, if there is no Managing General Partner remaining, any Person elected by
the affirmative vote of Partners constituting (i) the Required Founding Limited
Partners and (ii) the holders of not less than two-thirds of all the Equity
Interests then outstanding and not less than two-thirds of all Additional Equity
Interests (if any) then outstanding (the "Liquidator")) shall be responsible for
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oversight of the winding up and dissolution of the Partnership. The Liquidator
shall obtain a full accounting of the assets and liabilities of the Partnership
and such Partnership assets shall be liquidated as promptly as the Liquidator is
able to do so without any undue loss in value, with the proceeds therefrom
applied and distributed in the following order:
(1) First, to the discharge of Partnership debts and liabilities
to creditors, including (to the extent permitted by law)
creditors that are Partners;
(2) Second, to the discharge of Partnership debts
and liabilities to the Partners (to the extent
not covered in clause (1) above);
(3) The balance, if any, except as provided in the last sentence
of subsection 4.03(a), to the Partners in proportion to their
Equity Interests, as adjusted to reflect the terms of any
Additional Equity Interests (it being understood that the
distributions contemplated by this clause (3) in respect of
any Class A Unit shall be the same as the distribution in
respect of each other Class A Unit).
(b) In accordance with the provisions of subsection 10.03(a), the
Liquidator shall proceed without any unnecessary delay to sell and otherwise
liquidate the Partnership assets; provided, however, that if the Liquidator
shall determine that an immediate sale of part or all of the Partnership assets
would cause undue loss to the Partners, the Liquidator may defer the liquidation
except (i) to the extent provided by the Act or (ii) as may be necessary to
satisfy the debts and liabilities of the Partnership to Persons other than the
Partners (but only in their capacities as Partners).
(c) If, in the sole and absolute discretion of the Liquidator, there
are Partnership assets that the Liquidator will not be able to liquidate, or if
the liquidation of such assets would result in undue loss to the Partners, the
Liquidator may distribute such Partnership assets to the Partners in-kind, in
lieu of cash, as tenants-in-common (each having an interest therein
proportionate to its Equity Interest, as adjusted to reflect the terms of any
Additional Equity Interests owned by such Partner, it being understood that the
distributions contemplated by this subsection (c) in respect of
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any Class A Unit shall be the same as such distributions in respect of each
other Class A Unit)) in accordance with the provisions of subsection 10.03(a).
The foregoing notwithstanding, such in-kind distributions shall only be made if
in the Liquidator's good faith judgment that is in the best interest of the
Partners.
(d) Upon the complete liquidation and distribution of the
Partnership assets, the Partners shall cease to be Partners of the Partnership,
and the Liquidator shall execute, acknowledge and cause to be filed all
certificates and notices required by law to terminate the Partnership. Upon the
dissolution of the Partnership pursuant to Section 10.01, the Liquidator shall
cause to be prepared, and shall furnish to each of the Partners, a statement
setting forth the assets and liabilities of the Partnership. Promptly following
the complete liquidation and distribution of the Partnership assets, the
Liquidator shall furnish to each Partner a statement showing the manner in which
the Partnership assets were liquidated and distributed.
10.04 Time for Winding-Up. Anything in this Article 10
notwithstanding, a reasonable time shall be allowed for the orderly winding-up
of the business and affairs of the Partnership and the liquidation of the
Partnership assets in order to minimize any potential for losses as a result of
such process. During the period of winding-up, this agreement shall remain in
full force and effect and shall govern the rights and relationships of the
Partners inter se.
ARTICLE 11 - GENERAL PROVISIONS
11.01 Entire Agreement; Amendments and Waivers.
(a) This agreement contains the entire agreement among the parties
and supersedes all prior written or oral agreements among them respecting the
subject matter hereof. Without limiting the generality of the immediately
preceding sentence, in the event of any inconsistency between the Plan and this
agreement, the provisions of this agreement shall govern.
(b) Except for amendments authorized under subsection 11.01(c), this
agreement may not be amended without the approval in writing of Partners
constituting (i) the Managing General Partner and the Required Founding Limited
Partners and
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(ii) the holders of not less than two-thirds of all the Equity Interests then
outstanding and not less than two-thirds of all Additional Equity Interests (if
any) then outstanding; provided, however, that no amendment hereunder that has
the effect of (A) amending this subsection 11.01(b) or subsection 11.01(c) or
the definition of any term used in this subsection 11.01(b) or subsection
11.01(c), (B) amending subsection 11.08(b), (C) converting all or any part of a
Limited Partner's Interest into a general partner interest, (D) imposing any
personal liability on any Limited Partner or (E) altering the Equity Interest of
any Partner (other than pursuant to subsection 7.12(b)) shall be effective
against such Partner without such Partner's written consent thereto; and
provided, further, that, until the Public Market Effective Date, without the
written consent of the Required Unrestricted Unitholders, no amendment hereto
may have the effect of (1) impairing any Partner's rights under Section 9.08,
(2) amending Article 6 or the definition of any term used in Article 6, (3)
amending Section 9.03 or otherwise imposing (except as may hereafter be required
by virtue of any change in applicable law) any additional restrictions on the
Transfer of any Unrestricted Units, (4) amending the last sentence of subsection
9.05(b), (5) amending the definition of Unrestricted Units or the definition of
any term used in such definition, (6) amending Article 5, (7) providing
additional exculpations or greater rights of indemnification of any General
Partner, (8) amending the definition of Unit Value, the proviso to the second
sentence of subsection 4.02(a) or the proviso at the end of subsection 4.02(a),
(9) amending Sections 7.07 through 7.10, (10) amending the proviso to subsection
7.05(b), (ll) amending the last sentence of subsection 9.05(a), (12) amending
the definition of Public Market Effective Date or the definition of Related
Person or (13) amending the definition of any term used in the articles,
sections or provisions referred to in the preceding clauses (1) through (12). In
addition, until the occurrence of a JMB Disqualification Event, without the
written consent of JMB Partner, no amendment hereto shall have the effect of
amending (v) subsection 4.02(e), (w) the last sentence of subsection 6.02(a),
(x) the last sentence of Section 7.09, (y) subsection 7.11(e) or (z) the last
sentence of subsection 9.05(a).
(c) In addition to any amendments otherwise authorized herein,
amendments may be made to this agreement from time to time by the Managing
General Partner, without the consent of any of the other Partners, (i) to add to
the duties or obligations of the Managing General Partner or surrender any right
or power granted to the Managing General Partner herein,
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for the benefit of the other Partners, (ii) to cure any ambiguity, to correct or
supplement any provision herein that may be inconsistent with any other
provision herein, or to make any other provisions with respect to matters or
questions arising under this agreement that will not be inconsistent with the
provisions of this agreement, (iii) to reflect the conversion to Class A Units
of any Class B Units, (iv) to reflect the cancellation of any Class B Units as
contemplated in Section 4.03, (v) to amend Schedule I hereto to reflect the
addition or substitution of Partners, (vi) to adjust the Equity Interest of a
Partner pursuant to subsection 7.12(b), (vii) to admit any Additional General
Partner or provide for rights and obligations of such Additional General Partner
in accordance with the provisions of subsection 4.02(c) or to convert all or any
part of the Interest of any Additional General Partner into a limited
partnership Interest pursuant to the provisions of subsection 4.02(d) or (viii)
to document the issuance of Class A Units or Additional Equity Interests
pursuant to Section 4.02 or any exercise of the Conversion Right or any similar
conversion right; provided, however, that no amendment made pursuant to this
subsection 11.01(c) shall (x) have any of the effects referred in (A) either of
the provisos to the first sentence of subsection 11.01(b) or (B) the last
sentence of subsection 11.01(b).
(d) No Partner may be charged with any waiver of its rights
hereunder unless such waiver shall be in writing signed by such Partner.
11.02 Appointment of Attorney or Agent.
(a) Each Partner by its execution hereof or any assumption
instrument contemplated in Section 9.10 does irrevocably constitute and appoint
the Managing General Partner (which term shall include the Liquidator, in the
event of a liquidation, for purposes of this Section 11.02) as attorney-in-fact
with full power of substitution, as its true and lawful attorney, in its name,
place and stead (but solely in such Partner's capacity as a Partner) to make,
execute, acknowledge, swear to and file in the appropriate public offices (i)
the Certificate, (ii) all amendments to this agreement or to the Certificate
required by law or authorized or required by the provisions of this agreement or
the Certificate, (iii) all certificates and other instruments necessary to
qualify or continue the Partnership as a limited partnership in the states or
countries where the Partnership is doing or intends to do business, (iv) any
other instrument which may be required to be
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filed by the Partnership under the laws of any state or governmental agency, or
which the Managing General Partner deems advisable to file, and (v) all
conveyances and other instruments necessary to effect the continuation of the
Partnership or the admission, withdrawal or substitution of any Partner pursuant
to Article 9 or to effect the Partnership's dissolution and termination pursuant
to Article 10; provided, however, that the provisions of this Section 11.02
shall not be construed to authorize the taking of any action that would cause
any Limited Partner to have any personal liability.
(b) The powers of attorney granted herein shall be deemed to be
coupled with an interest and shall be irrevocable and survive the dissolution,
death or incompetency of the Partners. In the event of any conflict between this
agreement and any instruments executed or filed by such attorney pursuant to the
power of attorney granted in this Section 11.02, this agreement shall control.
11.03 Construction. The singular shall be deemed to include the
plural and vice versa. Accounting terms used herein have the meanings provided
therefor under GAAP.
11.04 Governing Law. This agreement is governed by
and shall be construed in accordance with the law of the State
of Delaware.
11.05 Further Assurances. The parties agree to execute and deliver
all such documents, provide all such information and take or refrain from taking
any action as may be necessary or desirable to achieve the purposes of this
agreement and the Partnership.
11.06 Titles and Captions. All articles or section titles or
captions in this agreement are solely for convenience and shall not be deemed to
be part of this agreement or otherwise define, limit or extend the scope or
intent of any provision hereof.
11.07 Binding Agreement. This agreement shall be binding upon, and
shall inure to the benefit of, the parties hereto, and their respective heirs,
executors, personal representatives, successors and permitted assigns.
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11.08 Waiver of Partition; Appraisal Rights.
(a) Each of the parties hereto irrevocably waives during the term of
the Partnership any right that it may have to maintain any action for partition
with respect to any property of the Partnership.
(b) The Limited Partners and JMB Partner shall have, in respect of
the Class A Units only, the appraisal rights contemplated in Section 17-212 of
the Act to the same extent as would be available to a shareholder of a
corporation organized under the laws of the State of Delaware.
11.09 Counterparts and Effectiveness. This agreement may be executed
in several counterparts, which shall be treated as originals for all purposes,
and as so executed shall constitute one agreement, binding on all of the parties
hereto, notwithstanding that all the parties are not signatory to the original
or the same counterpart. Any such counterpart shall be admissible into evidence
as an original hereof against each Person who executed it. The execution of this
agreement and delivery thereof by facsimile shall be sufficient for all
purposes, and shall be binding upon any party who so executes.
11.10 Waiver of Trial by Jury. Each Partner, by its execution and
delivery of this agreement, waives any and all rights it may have to trial by
jury of any matter, cause, dispute or other claim arising under this agreement
or otherwise relating to the Partnership.
11.11 Notices. All notices required or desired to be given to a
Partner or an assignee of a Partner shall be given to it in writing at its
address specified in the books of the Partnership. Any such notice may be given
by hand delivery, reputable courier service, certified mail or telecopier. Each
such notice shall be effective (i) in case given by mail, two days after
mailing, postage prepaid, and (ii) in all other cases, upon receipt.
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IN WITNESS WHEREOF, each of the undersigned has signed this
agreement as set forth below to be effective as of the date first above written.
WORLD FINANCIAL PROPERTIES, INC.
By:
-----------------------------------
Name:
Title:
BATTERY PARK HOLDINGS INC.
By:
----------------------------------
Name:
Title:
OLYMPIA & YORK
TOWER B COMPANY
By: BATTERY PARK HOLDINGS INC.,
general partner
By:
----------------------------------
Name:
Title:
CANADIAN IMPERIAL BANK
OF COMMERCE
By:
---------------------------------
Name:
Title:
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WFP HOLDINGS LIMITED PARTNERSHIP
By: WFP Inc., its general partner
By:
--------------------------------
Name:
Title:
EMERALD LP HOLDINGS, INC.
By:
-------------------------------
Name:
Title:
JMB 000 XXXX XXXXXX XXXXXXX COMPANY,
LLC
By: XXX/000 XXXX XXXXXX ASSOCIATES,
LTD., its managing member
By: JMB PARK AVENUE, INC.,
a general partner
By:
------------------------------------
Name:
Title:
WORLD FINANCIAL PROPERTIES, INC., as authorized
signatory for the Limited Partners identified
on Schedule I annexed hereto (other than BPHI
Partner, Dragon Partner, CIBC Partner and
Citibank Partner)
By:
----------------------------------
Name:
Title:
SCHEDULE I
Partners and Units
Class A Class B-1 Class B-2
Partners Units Units Units
General Partners
WORLD FINANCIAL
PROPERTIES, INC. _____ _____ _____
JMB 000 XXXX XXXXXX
XXXXXXX COMPANY, LLC _____ _____ _____
Limited Partners
BATTERY PARK HOLDINGS
INC. _____ _____ _____
OLYMPIA & YORK TOWER B
COMPANY
CANADIAN IMPERIAL BANK _____ _____ _____
OF COMMERCE
WFP HOLDINGS LIMITED
PARTNERSHIP _____ _____ _____
EMERALD LP HOLDINGS,
INC. _____ _____ _____
[UNSECURED CREDITOR] _____ _____ _____
[UNSECURED CREDITOR] _____ _____ _____
[UNSECURED CREDITOR] _____ _____ _____
[UNSECURED CREDITOR] _____ _____ _____
[UNSECURED CREDITOR] _____ _____ _____
-------------------
* Asterisks indicate Persons that are Excluded Class B
Partners.
EXHIBIT A
[Form of Unit Certificate]
EXHIBIT B
[Form of Transfer Application]