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EXHIBIT 3.8
AGREEMENT OF LIMITED PARTNERSHIP
OF
TRAVELCENTERS PROPERTIES, L.P.
A DELAWARE LIMITED PARTNERSHIP
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TABLE OF CONTENTS
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Section Page
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Section 1 The Partnership.............................................................1
1.1 Formation...................................................................1
1.2 Partnership Name............................................................1
1.3 Purposes....................................................................1
1.4 Principal Place of Business.................................................1
1.5 Term........................................................................1
1.6 Filings; Agent for Service of Process.......................................1
1.7 Title to Property...........................................................2
1.8 Payments of Individual Obligations..........................................2
1.9 Independent Activities; Transactions with
Affiliates..................................................................2
1.10 Definitions.................................................................3
Section 2 Partner's Capital Contributions............................................13
2.1 General and Limited Partners...............................................13
2.2 Other Matters..............................................................13
Section 3 Allocations................................................................13
3.1 Profits....................................................................13
3.2 Losses.....................................................................13
3.3 Special Allocations........................................................14
3.4 Curative Allocations.......................................................16
3.5 Other Allocation Rules.....................................................16
3.6 Tax Allocations: Code Section 704(c).....................................17
Section 4 Distributions..............................................................17
4.1 Net Cash From Operations...................................................17
4.2 Net Cash From Sales or Refinancings........................................17
4.3 Division Among Interest Holders and General
Partner....................................................................17
4.4 Amounts Withheld...........................................................18
Section 5 Management.................................................................18
5.1 Authority of the General Partner...........................................18
5.2 Right to Rely on General Partner...........................................20
5.3 Restrictions on Authority of General Partner...............................21
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5.4 Duties and Obligations of General Partner..................................21
5.5 Indemnification of General Partner.........................................22
5.6 Compensation and Loans.....................................................23
5.7 Temporary Investments......................................................24
Section 6 Role of Limited Partners...................................................24
6.1 Rights or Powers...........................................................24
6.2 Voting Rights..............................................................24
6.3 Procedure for Consent......................................................24
Section 7 Representations and Warranties.............................................25
7.1 In General.................................................................25
7.2 Representations and Warranties.............................................25
Section 8 Books and Records..........................................................27
8.1 Books and Records..........................................................27
8.2 Reports....................................................................27
8.3 Tax Information............................................................27
Section 9 Amendments; Meetings......................................................28
9.1 Amendments.................................................................28
9.2 Meetings of the Partners...................................................28
9.3 Unanimous Consent..........................................................29
Section 10 Transfers of Interests.....................................................29
10.1 Restriction on Transfers...................................................29
Section 11 General Partner............................................................29
11.1 Additional General Partner.................................................29
11.2 Covenant Not to Withdraw, Transfer,
or Dissolve................................................................30
Section 12 Power of Attorney..........................................................30
12.1 General Partner as Attorney-In-Fact........................................30
12.2 Nature as Special Power....................................................31
Section 13 Dissolution and Winding Up.................................................31
13.1 Liquidating Events.........................................................31
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13.2 Winding Up.................................................................32
13.3 Compliance With Certain Requirements of
Regulations; Deficit Capital Accounts......................................33
13.4 Deemed Distribution and Recontribution.....................................34
13.5 Rights of General Partner Interest Holders.................................34
13.6 Notice of Dissolution......................................................34
Section 14 Miscellaneous..............................................................34
14.1 Notices....................................................................34
14.2 Binding Effect.............................................................35
14.3 Construction...............................................................35
14.4 Time.......................................................................35
14.5 Headings...................................................................35
14.6 Severability...............................................................35
14.7 Incorporation by Reference.................................................35
14.8 Further Action.............................................................35
14.9 Variation of Pronouns......................................................36
14.10 Governing Law..............................................................36
14.11 Waiver of Action for Partition; No Bill
for Partnership Accounting.................................................36
14.12 Counterpart Execution......................................................36
14.13 Sole and Absolute Discretion...............................................36
14.14 Specific Performance.......................................................36
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AGREEMENT OF LIMITED PARTNERSHIP
OF
TRAVELCENTERS PROPERTIES, L.P.
A DELAWARE LIMITED PARTNERSHIP
This AGREEMENT OF LIMITED PARTNERSHIP is entered into and shall be
effective as of November ___ , 2000, by and between TA OPERATING CORPORATION, a
Delaware corporation, as the General Partner, and TRAVELCENTERS REALTY, INC., a
Delaware corporation, and NATIONAL AUTO/TRUCKSTOPS, INC., a Delaware
corporation, as the Limited Partners, pursuant to the provisions of the Delaware
Revised Uniform Limited Partnership Act, on the following terms and conditions:
SECTION 1
THE PARTNERSHIP
1.1 FORMATION. The Partners hereby agree to form the Partnership as a
limited partnership pursuant to the provisions of the Act and upon the terms and
conditions set forth in this Agreement.
1.2 PARTNERSHIP NAME. The name of the Partnership shall be
TravelCenters Properties, L.P., a Delaware Limited Partnership and all business
of the Partnership shall be conducted in such name. The General Partner may
change the name of the Partnership upon ten (10) Business Days notice to the
Limited Partners.
1.3 PURPOSES. The Partnership may engage in any lawful business not
prohibited by the Act.
1.4 PRINCIPAL PLACE OF BUSINESS. The principal place of business of the
Partnership shall be at 24601 Center Ridge Road, Suite 200, Westlake, Ohio
44145-5634.
1.5 TERM. The term of the Partnership shall commence on the date hereof
and shall continue until the winding up and liquidation of the Partnership and
its business is completed following a Liquidating Event, as provided in Section
13 hereof.
1.6 FILINGS; AGENT FOR SERVICE OF PROCESS.
(a) The General Partner shall take any and all other
actions reasonably necessary to perfect and maintain the status of the
Partnership as a limited partnership under the laws of Delaware. The General
Partner shall cause amendments to the Certificate of Limited Partnership
("Certificate") to be filed whenever required by the Act. Such amendments shall
be executed by the General Partner or by any Person designated in the amendment
as a new General Partner.
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(b) The General Partner shall execute and cause to be
filed original or amended certificates and shall take any and all other actions
as may be reasonably necessary to perfect and maintain the status of the
Partnership as a limited partnership or similar type of entity under the laws of
any other states or jurisdictions in which the Partnership engages in business.
(c) Upon the dissolution of the Partnership, the General
Partner (or, in the event there is no remaining General Partner, any Person
elected pursuant to Section 13.2 hereof) shall promptly execute and cause to be
filed certificates of dissolution in accordance with the Act and the laws of any
other states or jurisdictions in which the Partnership has filed certificates.
1.7 TITLE TO PROPERTY. All real and personal property owned by the
Partnership shall be owned by the Partnership as an entity and no Partner shall
have any ownership interest in such property in its individual name or right,
and each Partner's interest in the Partnership shall be personal property for
all purposes. Except as otherwise provided in this Agreement, the Partnership
shall hold all of its real and personal property in the name of the Partnership
and not in the name of any Partner.
1.8 PAYMENTS OF INDIVIDUAL OBLIGATIONS. The Partnership's credit and
assets shall be used solely for the benefit of the Partnership, and no asset of
the Partnership shall be transferred or encumbered for or in payment of any
individual obligation of any Partner.
1.9 INDEPENDENT ACTIVITIES; TRANSACTIONS WITH AFFILIATES.
(a) The General Partner and any of its Affiliates shall be
required to devote only such time to the affairs of the Partnership as the
General Partner determines in its sole discretion may be necessary to manage and
operate the Partnership, and each such Person, to the extent not otherwise
directed by the General Partner, shall be free to serve any other Person or
enterprise in any capacity that it may deem appropriate in its discretion.
(b) Insofar as permitted by applicable law, the General
Partner (acting on its own behalf) and the Limited Partners (acting on their own
behalf) may, notwithstanding this Agreement, engage in whatever activities they
choose, whether the same are competitive with the Partnership or otherwise,
without having or incurring any obligation to offer any interest in such
activities to the Partnership or any Partner and neither this Agreement nor any
activity undertaken pursuant hereto shall prevent any Partner from engaging in
such activities, or require any Partner to permit the Partnership or any Partner
to participate in any such activities, and as a material part of the
consideration for the execution of this Agreement by each Partner, each Partner
hereby waives, relinquishes, and renounces any such right or claim of
participation.
(c) To the extent permitted by applicable law and except
as otherwise provided in this Agreement, the General Partner, when acting on
behalf of the
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Partnership, is hereby authorized to purchase property from, sell property to,
or otherwise deal with any Partner, acting on its own behalf, or any Affiliate
of any Partner, provided that any such purchase, sale or other transaction shall
be made on terms and conditions which are no less favorable to the Partnership
than if the sale, purchase, or other transaction has been entered into with an
independent third party.
1.10 DEFINITIONS. Capitalized words and phrases used in this Agreement
have the following meanings:
(a) "Act" means the Delaware Revised Uniform Limited
Partnership Act, as set forth in 6 Del. C. Section 17-101 et seq., as amended
from time to time (or any corresponding provisions of succeeding law).
(b) "Adjusted Capital Account Deficit" means, with respect
to any Interest Holder, the deficit balance, if any, in such Interest Holder's
Capital Account as of the end of the relevant Fiscal Year, after giving effect
to the following adjustments:
(i) Credit to such Capital Account any amounts which
such Interest Holder is obligated to restore pursuant to any provision of this
Agreement or is deemed to be obligated to restore pursuant to the penultimate
sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); and
(ii) Debit to such Capital Account the items
described in Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), and
1.704-1(b)(2)(ii)(d)(6) of the Regulations.
The foregoing definition of Adjusted Capital Account Deficit is intended to
comply with the provisions of Section 1.704-1(b)(2)(ii)(d) of the Internal
Revenue Code Regulations and shall be interpreted consistently therewith.
(c) "Adjusted Capital Contributions" means, as of any day,
an Interest Holder's Capital Contributions adjusted as follows:
(i) Increased by the amount of any Partnership
liabilities which, in connection with distributions pursuant to Sections 4.2
and 13.2 hereof, are assumed by such Interest Holder or are secured by any
Partnership Property distributed to such Interest Holder;
(ii) Increased by any amounts actually paid by such
Interest Holder to any Partnership lender pursuant to the terms of any
Assumption Agreement; and
(iii) Reduced by the amount of cash and the Gross
Asset Value of any Partnership Property distributed to such Interest Holder
pursuant to Section s 4.2 and 13.2 hereof and the amount of any liabilities of
such Interest Holder assumed by
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the Partnership or which are secured by any property contributed by such
Interest Holder to the Partnership.
In the event any Interest Holder transfers all or any portion of his Interest in
accordance with the terms of this Agreement, his transferee shall succeed to the
Adjusted Capital Contribution of the transferor to the extent it relates to the
transferred Interest.
(d) "Affiliate" means, with respect to any Person, (i) any
Person directly or indirectly controlling, controlled by or under common control
with such Person, (ii) any Person owning or controlling ten percent (10%) or
more of the outstanding voting interests of such Person, (iii) any officer,
director, general partner, trustee, or holder of ten percent (10%) or more of
the voting interests of any Person described in clauses (i) through (iii) of
this sentence. For purposes of this definition, the term "controls," "is
controlled by," or "is under common control with" shall mean the possession,
direct or indirect, of the power to direct or cause the direction of the
management and policies of a person or entity, whether through the ownership of
voting securities, by contract or otherwise.
(e) "Agreement" or "Partnership Agreement" means this
Agreement of Limited Partnership, as amended from time to time. Words such as
"herein," "hereinafter," "hereof," "hereto," and "hereunder," refer to this
Agreement as a whole, unless the context otherwise requires.
(f) "Assumption Agreement" means any agreement among the
Partnership, any of the Partners, and any Person to whom the Partnership is
indebted pursuant to a loan agreement, any seller financing with respect to an
installment sale, a reimbursement agreement, or any other arrangement
(collectively referred to as a "loan" for purposes of this Agreement) pursuant
to which any Partner expressly assumes any personal liability with respect to
such loan. The amount of any such loan shall be treated as assumed by the
Partners for all purposes under this Agreement in the proportions set forth in
such Assumption Agreement and their respective amounts so assumed shall be
credited to their respective Capital Accounts pursuant to Section 1.10(j)(i)
hereof. To the extent such loan is repaid by the Partnership, the Partners'
Capital Accounts shall be debited with their respective shares of the repayments
pursuant to Section 1.10(j)(ii) hereof. To the extent such loan is repaid by
some or all of the Partners from their own funds, there shall be no adjustments
to their Capital Accounts.
(g) "Bankruptcy" means, with respect to any Person, a
"Voluntary Bankruptcy" or an "Involuntary Bankruptcy." A "Voluntary Bankruptcy"
means with respect to any Person, the inability of such Person generally to pay
its debts as such debts become due, or an admission in writing by such Person of
its inability to pay its debts generally or a general assignment by such Person
for the benefit of creditors; the filing of any petition or answer by such
Person seeking to adjudicate it a bankrupt or insolvent, or seeking for itself
any liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of such Person or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors, or
seeking, consenting to, to
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acquiescing in the entry of an order for relief or the appointment of a
receiver, trustee, custodian or other similar official for such Person or for
any substantial part of its property; or corporate action taken by such Person
to authorize any of the actions set forth above. An "Involuntary Bankruptcy"
means, with respect to any Person, without the consent or acquiescence of such
Person, the entering of an order for relief or approving a petition for relief
or reorganization or any other petition seeking any reorganization, arrangement,
composition, readjustment, liquidation, dissolution or other similar relief
under any present or future bankruptcy, insolvency or similar statute, law or
regulation, or the filing of any such petition against such Person which
petition shall not be dismissed within ninety (90) days, or, without the consent
or acquiescence of such Person, the entering of an order appointing a trustee,
custodian, receiver, or liquidation of such Person or of all or any substantial
part of the property of such Person which order shall not be dismissed within
sixty (60) days.
(h) "Business Day" means a day of the year on which banks
are not required or authorized to close in Delaware.
(i) "Capital Account" means, with respect to the General
Partner or Interest Holder, the Capital Account maintained for such Person in
accordance with the following provisions:
(i) To each Person's Capital Account there shall be
credited such Person's Capital Contributions, such Person's distributive share
of Profits and any items in the nature of income or gain which are specially
allocated pursuant to Section 3.3 or Section 3.4 hereof, and the amount of any
Partnership liabilities assumed by such Person or which are secured by any
Property distributed to such Person.
(ii) To each Person's Capital Account there shall be
debited the amount of cash and the Gross Asset Value of any Property distributed
to such Person pursuant to any provision of this Agreement, such Person's
distributive share of Losses and any items in the nature of expenses or losses
which are specially allocated pursuant to Section 3.3 or Section 3.4 hereof, and
the amount of any liabilities of such Person assumed by the Partnership or which
are secured by any property contributed by such Person to the Partnership.
(iii) In the event all or a portion of an interest in
the Partnership is transferred in accordance with the terms of this Agreement,
the transferee shall succeed to the Capital Account of the transferor to the
extent it relates to the transferred interest.
(iv) In determining the amount of any liability for
purposes of Sections 1.10(c)(i), 1.10(c)(iii) and 1.10 (i)(ii) hereof, there
shall be taken into account Code Section 752(c) and any other applicable
provisions of the Code and Regulations.
The foregoing provisions and the other provisions of this Agreement
relating to the maintenance of Capital Accounts are intended to comply with
Regulations Section
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1.704-1(b), and shall be interpreted and applied in a manner consistent with
such Regulations. In the event the General Partner shall determine that it is
prudent to modify the manner in which the Capital Accounts, or any debits or
credits thereto (including, without limitation, debits or credits relating to
liabilities which are secured by contributions or distributed property or which
are assumed by the Partnership, General Partner, or Interest Holders), are
computed in order to comply with such Regulations, the General Partner may make
such modification, provided that it is not likely to have material effect on the
amounts distributed to any Person pursuant to Section 13 hereof upon the
dissolution of the Partnership. The General Partner also shall (i) make any
adjustments that are necessary or appropriate to maintain equality between the
Capital Accounts of the General Partner and Interest Holders and the amount of
Partnership capital reflected on the Partnership's balance sheet, as computed
for book purposes, in accordance with Regulations Section 1.704-1(b)(2)(iv)(q),
and (ii) make any appropriate modifications in the event unanticipated events
(for example, the acquisition by the Partnership of oil or gas properties) might
otherwise cause this Agreement not to comply with Regulations Section
1.704-1(b).
(j) "Capital Contributions" means, with respect to the
General Partner or Interest Holder, the amount of money and the initial Gross
Asset Value of any property (other than money) contributed to the Partnership
with respect to the interest in the Partnership held by such Person. The
principal amount of a promissory note which is not readily traded on an
established securities market and which is contributed to the Partnership by the
maker of the note (or a Person related to the maker of the note within the
meaning of Regulations Section 1.704-1(b)(2)(ii)(c)) shall not be included in
the Capital Account of any Person until the Partnership makes a taxable
disposition of the note or until (and to the extent) principal payments are made
on the note, all in accordance with Regulations Section 1.704-1(b)(2)(iv)(d)(2).
(k) "Certificate" has the meaning set forth in Section 1.5
hereof.
(l) "Code" means the Internal Revenue Code of 1986, as
amended from time to time (or any corresponding provisions of succeeding law).
(m) "Debt" means (i) any indebtedness for borrowed money
or deferred purchase price of property or evidenced by a note, bonds, or other
instruments, (ii) obligations as lessee under capital leases, (iii) obligations
secured by any mortgage, pledge, security interest, encumbrance, lien or charge
of any kind existing on any asset owned or held by the Partnership whether or
not the Partnership has assumed or become liable for the obligations secured
thereby, (iv) any obligation under any interest rate swap agreement (the
principal amount of such obligation shall be deemed to be the notional principal
amount on which such swap is based), and (v) obligations under direct or
indirect guarantees of (including obligations (contingent or otherwise) to
assure a creditor against loss in respect of) indebtedness or obligations of the
kinds referred to in clauses (i), (ii), (iii), and (iv) above, provided that
Debt shall not include obligations in respect of any accounts payable that are
incurred in the ordinary course of the Partnership's
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business and are not delinquent or are being contested in good faith by
appropriate proceedings.
(n) "Depreciation" means, for each Fiscal Year, an amount equal to
the depreciation, amortization, or other cost recovery deduction allowable with
respect to an asset for such Fiscal Year, except that if the Gross Asset Value
of an asset differs from its adjusted basis for federal income tax purposes at
the beginning of such Fiscal Year, Depreciation shall be an amount which bears
the same ratio to such beginning Gross Asset Value as the federal income tax
depreciation, amortization, or other cost recovery deduction for such Fiscal
Year bears to such beginning adjusted tax basis; provided however, that if the
adjusted basis for federal income tax purposes of an asset at the beginning of
such Fiscal Year is zero, Depreciation shall be determined with reference to
such beginning Gross Asset Value using any reasonable method selected by the
General Partner.
(o) "Environmental Laws" means any federal, state, or local statute,
code, ordinance, rule, regulation, permit, consent, approval, license, judgment,
order, writ, judicial decision, common law rule, decree, agency interpretation,
injunction or other authorization or requirement whenever promulgated, issued,
or modified, including the requirement to register underground storage tanks,
relating to:
(i) emissions, discharges, spills, releases, or threatened
release of pollutants, contaminants, Hazardous Substances (as hereinafter
defined), materials containing Hazardous Substances, or hazardous or toxic
materials or wastes into ambient air, surface water, groundwater, watercourses,
publicly or privately owned treatment works, drains, sewer systems, wetlands,
septic systems or onto land;
(ii) the use, treatment, storage, disposal, handling,
manufacturing, transportation, or shipment of Hazardous Substances, materials
containing Hazardous Substances or hazardous and/or toxic wastes, material,
products, or by-products (or of equipment or apparatus containing Hazardous
Substances) as defined in or regulated under the following statutes and their
implementing regulations: the Hazardous Materials Transportation Act, 49 U.S.C.
Section 1801 et seq., the Resource Conservation and Recovery Act, 42
U.S.C. Section 6901 et seq., the Comprehensive Environmental Response,
Compensation and Liability Act, as amended by the Superfund Amendments and
Reauthorization Act, 42 U.S.C. Section 9601 et seq., and/or the Toxic Substances
Control Act, 15 U.S.C. Section 2601 et seq., each as amended from time to time;
or
(iii) otherwise relating to pollution or the protection of
human health or the environment.
(p) "Family" has the meaning set forth in Section 318 of the Code.
(q) "Fiscal Year" means (i) the period commencing on the effective
date of this Agreement and ending on December 31st, (ii) any subsequent twelve
(12) month period commencing on January 1st and ending on December 31st, or
(iii) any
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portion of the period described in clause (ii) for which the Partnership is
required to allocate Profits, Losses and other items of Partnership income,
gain, loss or deduction pursuant to Section 3 hereof.
(r) "General Partner" means any Person who (i) is referred to as
such in the first paragraph of this Agreement or has become a General Partner
pursuant to the terms of this Agreement, and (ii) has not ceased to be a General
Partner pursuant to the terms of this Agreement. "General Partner" means all
such Persons.
(s) "Gross Asset Value" means, with respect to any asset, the
asset's adjusted basis for federal income tax purposes, except as follows:
(i) The initial Gross Asset Value of any asset contributed by
a Partner to the Partnership shall be the gross fair market value of such asset,
as determined by the contributing Partner and the General Partner, provided
that, if the contributing Partner is a General Partner, the determination of the
fair market value of a contributed asset shall require the consent of a majority
of the Limited Partners;
(ii) The Gross Asset Values of all Partnership assets shall be
adjusted to equal their respective gross fair market values, as determined by
the General Partner, as of the following times: (a) the acquisition of an
additional interest in the Partnership by any new or existing Partner in
exchange for more than a de minimis Capital Contribution; (b) the distribution
by the Partnership to a General Partner or Interest Holder of more than a de
minimis amount of Property as consideration for an interest in the Partnership;
and (c) the liquidation of the Partnership within the meaning of Regulations
Section 1.704-1(b)(2)(ii)(g): provided, however, that adjustments pursuant to
clauses (a) and (b) above shall be made only if the General Partner reasonably
determines that such adjustments are necessary or appropriate to reflect the
relative economic interests of the General Partner and Interest Holders in the
Partnership;
(iii) The Gross Asset Value of any Partnership asset
distributed to any General Partner or Interest Holder shall be adjusted to equal
the gross fair market value of such asset on the date of distribution as
determined by the distributee and the General Partner, provided that, if the
distributee is a General Partner, the determination of the fair market value of
the distributed asset shall require the consent of a majority of the Limited
Partners; and
(iv) The Gross Asset Values of Partnership assets shall be
increased (or decreased) to reflect any adjustments to the adjusted basis of
such assets pursuant to Code Section 734(b) or Code Section 743(b), but only to
the extent that such adjustments are taken into account in determining Capital
Accounts pursuant to Regulation Section 1.704-1(b)(2)(iv)(m) and Sections
1.10(al)(vi) and 3.3(g) hereof; provided, however, that Gross Asset Values shall
not be adjusted pursuant to this Section 1.10(s)(iv) to the extent the General
Partner determines that an adjustment pursuant to Section 1.10(s)(ii) hereof is
necessary or appropriate in connection with a transaction that would otherwise
result in an adjustment pursuant to this Section 1.10(s)(iv).
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If the Gross Asset Value of an asset has been determined or adjusted pursuant to
Section 1.10(s)(i), Section 1.10(s)(ii), or Section 1.10(s)(iv) hereof, such
Gross Asset Value shall thereafter be adjusted by the Depreciation taken into
account with respect to such asset for purposes of computing Profits and Losses.
(t) "Hazardous Substances" means (i) hazardous materials, hazardous
wastes, and hazardous substances as those terms are defined under the following
statutes and their implementing regulations as they may be amended from time to
time: the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801 et
seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et
seq., the Comprehensive Environmental Response, Compensation and Liability Act,
as amended by the Superfund Amendments and Reauthorization Act, 42 U.S.C.
Section 9601 et seq., the Clean Water Act, 33 U.S.C. Section 1251 et seq., the
Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq., the Clean Air Act,
42 U.S.C. Section 7401 et seq., (ii) petroleum and petroleum products including
crude oil and any fractions thereof, (iii) natural gas, synthetic gas, and any
mixtures thereof, (iv) asbestos and/or any material which contains any hydrated
mineral silicate, including, but not limited, to chrysolite, amosite,
crocidolite, tremolite, anthophylite, and/or actinolite, whether friable or
non-friable, (v) PCB's, or PCB-containing materials or fluids, (vi) radon, (vii)
any other hazardous radioactive, toxic, or noxious substance, material,
pollutant, or solid, liquid or gaseous waste, and (viii) any substance with
respect to which a federal, state or local agency requires environmental
investigation, monitoring, or remediation.
(u) "Interest" means an ownership interest in the Partnership
pursuant to Section 2.1 hereof, including any and all benefits to which the
holder of such an Interest may be entitled as provided in this Agreement,
together with all obligations of such Person to comply with the terms and
provisions of this Agreement.
(v) "Interest Holder" means any Person who holds an Interest,
regardless of whether such Person has been admitted to the Partnership as a
Limited Partner. "Interest Holders" means all such Persons.
(w) "Involuntary Bankruptcy" has the meaning set forth in Section
1.10(g) hereof.
(x) "Issuance Items" has the meaning set forth in Section 3.3(h)
hereof.
(y) "Limited Partner" means any Person (i) whose name is set forth
on Exhibit A attached hereto or who has become a Limited Partner pursuant to the
terms of this Agreement, and (ii) who holds an Interest. "Limited Partners"
means all such Persons. All references in this Agreement to a majority or a
specified percentage of the Limited Partners shall mean Limited Partners whose
combined Interests represent more than fifty percent (50%) or such specified
percentage, respectively, of the Interests then held by all Limited Partners.
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(z) "Liquidating Event" has the meaning set forth in Section 13.1
hereof.
(aa) "Net Cash From Operations" means the gross cash proceeds from
Partnership operations (including sales and dispositions of Property in the
ordinary course of business) less the portion thereof used to pay or establish
reserves for all Partnership expenses, debt payments, capital improvements,
replacements, and contingencies, all as determined by the General Partner. "Net
Cash From Operations" shall not be reduced by depreciation, amortization, cost
recovery deductions, or similar allowances, but shall be increased by any
reductions of reserves previously established pursuant to the first sentence of
this Section 1.10(aa) and Section 1.10(ab) hereof.
(ab) "Net Cash From Sales or Refinancings" means the net cash
proceeds from all sales and other dispositions (other than in the ordinary
course of business) and all refinancings of Property, less any portion thereof
used to establish reserves, all as determined by the General Partner. "Net Cash
From Sales or Refinancings" shall include all principal and interest payments
with respect to any note or other obligation received by the Partnership in
connection with sales and other dispositions (other than in the ordinary course
of business) of Property.
(ac) "Nonrecourse Deductions" has the meaning set forth in Section
1.704-2(b)(1) of the Regulations.
(ad) "Nonrecourse Liability" has the meaning set forth in Section
1.704-2(b)(3) of the Regulations
(ae) "Partner Nonrecourse Debt" has the meaning set forth in Section
1.704-2(b)(4) of the Regulations.
(af) "Partner Nonrecourse Debt Minimum Gain" means an amount, with
respect to each Partner Nonrecourse Debt, equal to the Partnership Minimum Gain
that would result if such Partner Nonrecourse Debt were treated as a Nonrecourse
Liability, determined in accordance with Section 1.704-2(i)(3) of the
Regulations.
(ag) "Partner Nonrecourse Deductions" has the meaning set forth in
Sections 1.704-2(i)(1) and 1.704-2(i)(2) of the Regulations.
(ah) "Partners" means the General Partner and the Limited Partners,
where no distinction is required by the context in which the term is used
herein. "Partner" means any one of the Partners.
(ai) "Partnership" means the partnership formed pursuant to this
Agreement and the partnership continuing the business of this Partnership in the
event of dissolution as herein provided.
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(aj) "Partnership Minimum Gain" has the meaning set forth in
Sections 1.704-2(b)(2) and 1.704-2(d) of the Regulations.
(ak) "Person" means any individual, partnership, corporation, trust,
or other entity.
(al) "Profits" and "Losses" means, for each Fiscal Year, an amount
equal to the Partnership's taxable income or loss for such Fiscal Year,
determined in accordance with Code Section 703(a) (for this purpose, all items
of income, gain, loss, or deduction required to be stated separately pursuant to
Code Section 703(a)(1) shall be included in taxable income or loss), with the
following adjustments:
(i) Any income of the Partnership that is exempt from federal
income tax and not otherwise taken into account in computing Profits or Losses
pursuant to this Section 1.10(al) shall be added to such taxable income or loss;
(ii) Any expenditures of the Partnership described in Code
Section 705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures
pursuant to Regulations Section 1.704-1(b)(2)(iv)(i), and not otherwise taken
into account in computing Profits or Losses pursuant to this Section 1.10(al)
shall be subtracted from such taxable income or loss;
(iii) In the event the Gross Asset Value of any Partnership
asset is adjusted to Section 1.10(s)(ii) or Section 1.10(s)(iii) hereof, the
amount of such adjustment shall be taken into account as gain or loss from the
disposition of such asset for purposes of computing Profits or Losses;
(iv) Gain or Loss resulting from any disposition of Property
with respect to which gain or loss is recognized for federal income tax purposes
shall be computed by reference to the Gross Asset Value of the property disposed
of, notwithstanding that the adjusted tax basis of such property differs from
its Gross Asset Value;
(v) In lieu of the depreciation, amortization, and other cost
recovery deductions taken into account in computing such taxable income or loss,
there shall be taken into account Depreciation for such Fiscal Year, computed in
accordance with Section 1.10(n) hereof;
(vi) To the extent an adjustment to the adjusted tax basis of
any Partnership asset pursuant to Code Section 734(b) or Code Section 743(b) is
required pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(4) to be taken
into account in determining Capital Accounts as a result of a distribution other
than in complete liquidation of a Partner's or Interest Holder's Interest, the
amount of such adjustment shall be treated as an item of gain (if the adjustment
increases the basis of the asset) or loss (if the adjustment decreases the basis
of the asset) from the disposition of the asset and shall be taken into account
for purposes of computing Profits or Losses; and
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(vii) Notwithstanding any other provision of this Section
1.10(al), any items which are specially allocated pursuant to Section 3.3 or
Section 3.4 hereof shall not be taken into account in computing Profits of
Losses.
The amounts of the items of Partnership income, gain, loss or deduction
available to be specially allocated pursuant to Sections 3.3 and 3.4 hereof
shall be determined by applying rules analogous to those set forth in Sections
1.10(al)(i) through 1.10(al)(vi) above.
(am) "Property" means all real and personal property acquired by the
Partnership and any improvements thereto, and shall include both tangible and
intangible property.
(an) "Reconstitution Period" has the meaning set forth in Section
13.1 hereof.
(ao) "Regulations" means the Income Tax Regulations, including
Temporary Regulations, promulgated under the Code, as such regulations may be
amended from time to time (including corresponding provisions of succeeding
regulations).
(ap) "Regulatory Allocations" has the meaning set forth in Section
3.4 hereof.
(aq) "Tax Matters Partner" has the meaning set forth in Section
5.1(j) hereof.
(ar) "Transfer" means, as a noun, any voluntary or involuntary
transfer, sale, or other disposition and, as a verb, voluntarily or
involuntarily to transfer, sell, or otherwise dispose of.
(as) "Voluntary Bankruptcy" has the meaning set forth in Section
1.10(q) hereof.
(at) "Wholly Owned Affiliate" of any Person means an Affiliate of
such Person (i) one hundred percent (100%) of the voting stock or beneficial
ownership of which is owned directly by such Person, or by any Person who,
directly or indirectly, owns one hundred percent (100%) of the voting stock or
beneficial ownership of such Person, (ii) an Affiliate of such Person who,
directly or indirectly, owns one hundred percent (100%) of the voting stock or
beneficial ownership of such Person, and (iii) and Wholly Owned Affiliate of any
Affiliate described in clause (i) or clause (ii) of this Section 1.10(at).
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SECTION 2
PARTNER'S CAPITAL CONTRIBUTIONS
2.1 GENERAL AND LIMITED PARTNERS. The names, addresses, Capital
Contributions, and Interests of the General Partner and the Limited Partners are
set forth on Exhibit A attached hereto and incorporated by reference herein.
Upon receipt of each Partner's Capital Contribution, a certificate shall be
issued and delivered to such Partner to reflect its Interest, which certificate
shall be subject to the provisions of Article 8 of the Uniform Commercial Code,
as adopted by the State of Delaware.
2.2 OTHER MATTERS.
(a) Except as otherwise provided in this Agreement, no General
Partner or Interest Holder shall demand or receive a return of his Capital
Contributions or withdraw from the Partnership without the consent of all
Partners. Under circumstances requiring a return or any Capital Contributions,
no General Partner or Interest Holder shall have the right to receive property
other than cash except as may be specifically provided herein.
(b) No General Partner or Interest Holder shall receive any
interest, salary or drawing with respect to his Capital Contributions or his
Capital Account or for services rendered on behalf of the Partnership or
otherwise in his capacity as a General Partner or Interest Holder, except as
otherwise provided in this Agreement.
(c) Provided that the Limited Partners act in accordance with this
Agreement and except as otherwise provided by an Assumption Agreement, no
Limited Partner shall be liable for the debts, liabilities, contracts, or any
other obligations of the Partnership. Except as otherwise provided by any other
agreements among the Partners or mandatory provisions of applicable state law, a
Limited Partner shall be liable only to make his Capital Contributions and shall
not be required to lend any funds to the Partnership or, after his Capital
Contributions have been made, to make any additional Capital Contributions to
the Partnership.
(d) No General Partner shall have any personal liability for the
repayment of any Capital Contributions of any Interest Holder.
SECTION 3
ALLOCATIONS
3.1 PROFITS. After giving effect to the special allocations set forth in
Sections 3.3 and 3.4 hereof, Profits for any Fiscal Year shall be allocated in
accordance with the Partner's Interest in the Partnership.
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3.2 LOSSES. After giving effect to the special allocations set forth in
Sections 3.3 and 3.4 hereof, Losses for any Fiscal Year shall be allocated in
accordance with the Partner's Interest in the Partnership.
The Losses allocated pursuant to this Section 3.2 hereof shall not
exceed the maximum amount of Losses that can be so allocated without causing any
Interest Holder to have an Adjusted Capital Account Deficit at the end of any
Fiscal Year. In the event some but not all of the Interest Holders would have
Adjusted Capital Account Deficits as a consequence of an allocation of Losses
pursuant to Section 3.2 hereof, the limitation set forth in this Section 3.2
shall be applied on an Interest Holder by Interest Holder basis so as to
allocate the maximum permissible Losses to each Interest Holder under Section
1.704-1(b)(2)(ii)(d) of the Regulations. All Losses in excess of the limitations
set forth in this Section 3.2 shall be allocated to the General Partner.
3.3 SPECIAL ALLOCATIONS. The following special allocations shall be made
in the following order:
(a) Minimum Gain Chargeback. Except as otherwise provided in Section
1.704-2(f) of the Regulations, notwithstanding any other provision of this
Section 3, if there is a net decrease in Partnership Minimum Gain during any
Fiscal Year, the General Partner and Interest Holder shall be specially
allocated items of Partnership income and gain for such Fiscal Year (and, if
necessary, subsequent Fiscal Years) in an amount equal to such Person's share of
the net decrease in Partnership Minimum Gain, determined in accordance with
Regulations Section 1.704-2(g). Allocations pursuant to the previous sentence
shall be made in proportion to the respective amounts required to be allocated
to the General Partner and Interest Holder pursuant thereto. The items to be so
allocated shall be determined in accordance with Sections 1.704-2(f)(6) and
1.704-2(j)(2) of the Regulations. This Section 3.3(a) is intended to comply with
the minimum gain chargeback requirement in Section 1.704-2(f) of the Regulations
and shall be interpreted consistently therewith.
(b) Partner Minimum Gain Chargeback. Except as otherwise provided in
Section 1.704-2(i)(4) of the Regulations, notwithstanding any other provision of
this Section 3, if there is a net decrease in Partner Nonrecourse Debt Minimum
Gain attributable to a Partner Nonrecourse Debt during any Partnership Fiscal
Year, each Person who has a share of the Partner Nonrecourse Debt Minimum Gain
attributable to such Partner Nonrecourse Debt, determined in accordance with
Section 1.704-2(i)(5) of the Regulations, shall be specially allocated items of
Partnership income and gain for such Fiscal Year (and, if necessary, subsequent
Fiscal Years) in an amount equal to such Person's share of the net decrease in
Partner Nonrecourse Debt Minimum Gain attributable to such Partner Nonrecourse
Debt, determined in accordance with Regulations Section 1.704-2(i)(4).
Allocations pursuant to the previous sentence shall be made in proportion to the
respective amounts required to be allocated to the General Partner and Interest
Holder pursuant thereto. The items to be so allocated shall be determined in
accordance with Sections 1.704-2(i)(4) and 1.704-2(j)(2) of the Regulations.
This Section 3.3(b) is intended to comply with the minimum gain
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chargeback requirement in Section 1.704-2(i)(4) of the Regulations and shall be
interpreted consistently therewith.
(c) Qualified Income Offset. In the event any Interest Holder
unexpectedly receives any adjustments, allocations, or distributions described
in Section 1.704-1(b)(2)(ii)(d)(4), Section 1.704-1(b)(2)(ii)(d)(5) or Section
1.704-1(b)(2)(ii)(d)(6) of the Regulations, items of Partnership income and gain
shall be specially allocated to each such Interest Holder in an amount and
manner sufficient to eliminate, to the extent required by the Regulations, the
Adjusted Capital Account Deficit of such Interest Holder as quickly as possible,
provided that an allocation pursuant to this Section 3.3(c) shall be made only
if and to the extent that such Interest Holder would have an Adjusted Capital
Account Deficit after all other allocations provided for in this Section 3 have
been tentatively made as if this Section 3.3(c) were not in the Agreement.
(d) Gross Income Allocation. In the event any Interest Holder has a
deficit Capital Account at the end of any Partnership Fiscal Year which is in
excess of the sum of (i) the amount such Interest Holder is obligated to restore
pursuant to any provision of this Agreement, and (ii) the amount such Interest
Holder is deemed to be obligated to restore pursuant to the penultimate
sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5), each such
Interest Holder shall be specially allocated items of Partnership income and
gain in the amount of such excess as quickly as possible, provided that an
allocation pursuant to this Section 3.3(d) shall be made only if and to the
extent that such Interest Holder would have a deficit Capital Account in excess
of such sum after all other allocations provided for in this Section 3 have been
made as if Section 3.3(c) hereof and this Section 3.3(d) were not in the
Agreement.
(e) Nonrecourse Deductions. Nonrecourse Deductions for any Fiscal
Year shall be allocated pursuant to the Partner's Interest in the Partnership.
(f) Partner Nonrecourse Deductions. Any Partner Nonrecourse
Deductions for any Fiscal Year shall be specially allocated to the General
Partner or Interest Holder who bears the economic risk of loss with respect to
the Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions are
attributable in accordance with Regulations Section 1.704-2(i)(1).
(g) Section 754 Adjustments. To the extent an adjustment to the
adjusted tax basis of any Partnership asset pursuant to Code Section 734(b) or
Code Section 743(b) is required, pursuant to Regulations Section
1.704-1(b)(2)(iv)(m)(2) or Regulations Section 1.704-1(b)(2)(iv)(m)(4), to be
taken into account in determining Capital Accounts as the result of a
distribution to the General Partner of Interest Holder in complete liquidation
of his interest in the Partnership, the amount of such adjustment to Capital
Accounts shall be treated as an item of gain (if the adjustment increases the
basis of the asset) or loss (if the adjustment decreases such basis) and such
gain or loss shall be specially allocated to the General Partner and the
Interest Holders in accordance with their interests in the Partnership in the
event that Regulations Section 704-1(b)(2)(iv)(m)(2) applies, or to the General
Partner or Interest Holder to whom such
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distribution was made in the event that Regulations Section
1.704-1(b)(2)(iv)(m)(4) applies.
(h) Allocations Relating to Taxable Issuance of Partnership
Interests. Any income, gain, loss or deduction realized as a direct or indirect
result of the issuance of an interest by the Partnership to a Partner (the
"Issuance Items") shall be allocated among the General Partner and Interest
Holders so that, to the extent possible, the net amount of such Issuance Items,
together with all other allocations under this Agreement to each General Partner
and Interest Holder, shall be equal to the net amount that would have been
allocated to each such General Partner and Interest Holder if the Issuance Items
had not been realized.
3.4 CURATIVE ALLOCATIONS. The allocations set forth in Sections 3.2,
3.3(a), 3.3(b), 3.3(c), 3.3(d), 3.3(e), 3.3(f), and 3.3(g) hereof (the
"Regulatory Allocations") are intended to comply with certain requirements of
the Regulations. It is the intent of the Partners that, to the extent possible,
all Regulatory Allocations shall be offset either with other Regulatory
Allocations or with special allocations of other items of Partnership income,
gain, loss or deduction pursuant to this Section 3.4. Therefore, notwithstanding
any other provision of this Section 3 (other than the Regulatory Allocations),
the General Partner shall make such offsetting special allocations of
Partnership income, gain, loss or deduction in whatever manner it determines
appropriate so that, after such offsetting allocations are made, the General
Partner's and Interest Holder's Capital Account balance is, to the extent
possible, equal to the Capital Account balance such General Partner or Interest
Holder would have had if the Regulatory Allocations were not part of the
Agreement and all Partnership items were allocated pursuant to Sections 3.1 and
3.2. In exercising its discretion under this Section 3.4, the General Partner
shall take into account future Regulatory Allocations under Sections 3.3(a) and
3.3(b) that, although not yet made, are likely to offset other Regulatory
Allocations previously made under Sections 3.3(e) and 3.3(f).
3.5 OTHER ALLOCATION RULES.
(a) For purposes of determining the Profits, Losses, or any other
items allocable to any period, Profits, Losses, and any such other items shall
be determined on a daily, monthly, or other basis, as determined by the General
Partner using any permissible method under Code Section 706 and the Regulations
thereunder.
(b) All allocations to the Interest Holders pursuant to this Section
3 shall, except as otherwise provided, be divided among them in proportion to
the Interests held by each.
(c) The partners are aware of the income tax consequences of the
allocations made by this Section 3 and hereby agree to be bound by the
provisions of this Section 3 in reporting their shares of Partnership income and
loss for income tax purposes.
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(d) Solely for the purposes of determining a Partner's or Interest
Holder's proportionate share of the "excess nonrecourse liabilities" of the
Partnership within the meaning of Regulations Section 1.752-3(a)(3), the
Partners' and Interest Holders' interests in Partnership profits are in
proportion to their Interest.
(e) To the extent permitted by Section 1.704-2(h)(3) of the
Regulations, the General Partner shall endeavor to treat distributions of Net
Cash From Operations or Net Cash From Sales or Refinancings as having been made
from the proceeds of a Nonrecourse Liability or a Partner Nonrecourse Debt only
to the extent that such distributions would cause or increase an Adjusted
Capital Account Deficit for any Interest Holder.
3.6 TAX ALLOCATIONS: CODE SECTION 704(c). In accordance with Code Section
704(c) and the Regulations thereunder, income, gain, loss and deduction with
respect to any property contributed to the capital of the Partnership shall,
solely for tax purposes, be allocated among the General Partner and Interest
Holders so as to take account of any variation between the adjusted basis of
such property to the Partnership for federal income tax purposes and its initial
Gross Asset Value (computed in accordance with Section 1.10(s)(i) hereof).
In the event the Gross Asset Value of any Partnership asset is adjusted
pursuant to Section 1.10(s)(ii) hereof, subsequent allocations of income, gain,
loss, and deduction with respect to such asset shall take account of any
variation between the adjusted basis of such asset for federal income tax
purposes and its Gross Asset Value in the same manner as under Code Section
704(c) and the Regulations thereunder.
Any elections or other decisions relating to such allocations shall be
made by the General Partner in any manner that reasonably reflects the purpose
and intention of this Agreement. Allocations pursuant to this Section 3.6 are
solely for purposes of federal, state, and local taxes and shall not affect, or
in any way be taken into account in computing, any Person's Capital Account or
share of Profits, Losses, other items, or distributions pursuant to any
provision of the Agreement.
SECTION 4
DISTRIBUTIONS
4.1 NET CASH FROM OPERATIONS. Except as otherwise provided in Section 13
hereof, Net Cash From Operations, if any, shall be distributed at such times as
the General Partner may in its sole discretion determine.
4.2 NET CASH FROM SALES OR REFINANCINGS. Except as otherwise provided in
Section 13 hereof, Net Cash From Sales or Refinancings shall be distributed, at
such times as the General Partner may in its sole discretion determine.
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4.3 DIVISION AMONG INTEREST HOLDERS AND GENERAL PARTNER. All distributions
to the Interest Holders pursuant to this Section 4 shall be divided among them
in proportion to the Interests held by each.
4.4 AMOUNTS WITHHELD. All amounts withheld pursuant to the Code or any
provision of any state or local tax law with respect to any payment,
distribution or allocation to the Partnership, the General Partner or the
Interest Holders shall be treated as amounts distributed to the General Partner
and the Interest Holders pursuant to this Section 4 for all purposes under this
Agreement. The General Partner is authorized to withhold from distributions, or
with respect to allocations, to the General Partner and Interest Holders and to
pay over to any federal, state or local government any amounts required to be so
withheld pursuant to the Code or any provisions of any other federal, state or
local law and shall allocate any such amounts to the General Partner and
Interest Holders with respect to which such amount was withheld.
SECTION 5
MANAGEMENT
5.1 AUTHORITY OF THE GENERAL PARTNER. Subject to the limitations and
restrictions set forth in this Agreement (including, without limitation, those
set forth in this Section 5), the General Partner shall have the sole and
exclusive right to manage the business of the Partnership and shall have all of
the rights and powers which may be possessed by general partners under the Act
including, without limitation, the right and power to:
(a) Acquire by purchase, lease, or otherwise any real or personal
property which may be necessary, convenient, or incidental to the accomplishment
of the purposes of the Partnership;
(b) Operate, maintain, finance, improve, construct, own, grant
options with respect to, sell, convey, assign, mortgage, and lease any real
estate and any personal property necessary, convenient, or incidental to the
accomplishment of the purposes of the Partnership;
(c) Execute any and all agreements, contracts, documents,
certifications, and instruments necessary or convenient in connection with the
management, maintenance, and operation of Property, or in connection with
managing the affairs of the Partnership, including executing amendments to the
Agreement and the Certificate in accordance with the terms of the Agreement,
both as General Partner and, if required, as attorney[s]-in-fact for the Limited
Partners pursuant to any power of attorney granted by the Limited Partners to
the General Partner;
(d) Borrow money and issue evidences of indebtedness necessary,
convenient, or incidental to the accomplishment of the purposes of the
Partnership, and secure the same by mortgage, pledge, or other lien on any
property;
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(e) Execute, in furtherance of any or all of the purposes of the
Partnership, any deed, lease, mortgage, deed of trust, mortgage note, promissory
note, bill of sale, contract, or other instrument purporting to convey or
encumber any or all of the Property;
(f) Prepay in whole or in part, refinance, recast, increase, modify,
or extend any liabilities affecting the Property and in connection therewith
execute any extensions or renewals of encumbrances on any or all of the
Property;
(g) Care for and distribute funds to the General Partner and
Interest Holders by way of cash, income, return of capital, or otherwise all in
accordance with the provisions of this Agreement, and perform all matters in
furtherance of the objectives of the Partnership or this Agreement;
(h) Contract on behalf of the Partnership for the employment and
services of employees and/or independent contractors, such as lawyers and
accountants, and delegate to such Persons the duty to manage or supervise any of
the assets or operations of the Partnership;
(i) Engage in any kind of activity and perform and carry out
contracts of any kind (including contracts of insurance covering risks to
Property and General Partner liability) necessary or incidental to, or in
connection with, the accomplishment of the purposes of the Partnership, as may
be lawfully carried on or performed by a partnership under the laws of each
state in which the Partnership is then formed or qualified;
(j) Make any and all elections for federal, state, and local tax
purposes including, without limitation, any election, if permitted by applicable
law: (i) to adjust the basis of Property pursuant to Code Sections 754, 734(b),
and 743(b), or comparable provisions of state or local law, in connection with
transfer of interests in the Partnership and Partnership distributions; (ii)
with the consent of a majority of the Limited Partners, to extend the statute of
limitations for assessment of tax deficiencies against the General Partner and
Interest Holders with respect to adjustments to the Partnership's federal,
state, or local tax returns; and (iii) to the extent provided in Code Sections
6221 through 6231, to represent the Partnership, the General Partner and the
Interest Holders before taxing authorities or courts of competent jurisdiction
in tax matters affecting the Partnership, the General Partner, and the Interest
Holders in their capacities as General Partner or Interest Holders, and to file
any tax returns and to execute any agreements or other documents relating to or
affecting such tax matters, including agreements or other documents that bind
the General Partner and Interest Holders with respect to such tax matters or
otherwise affect the rights of the Partnership, General Partner, and Interest
Holders. The General Partner is specifically authorized to act as the "Tax
Matters Partner" under the Code and in any similar capacity under state or local
law;
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(k) Take, or refrain from taking, all actions, not expressly
proscribed or limited by this Agreement, as may be necessary or appropriate to
accomplish the purposes of the Partnership; and
(l) Institute, prosecute, defend, settle, compromise, and dismiss
lawsuits or other judicial or administrative proceedings brought on or in behalf
of, or against, the Partnership or the Partners in connection with activities
arising out of, connected with, or incidental to this Agreement, and engage
counsel or others in connection therewith.
Unless otherwise provided in this Agreement, the General Partner has
the power and authority to delegate to one or more other persons, including
agents, officers and employees of the General Partner or the Partnership, the
General Partner 's rights and powers to manage and control the business and
affairs of the Partnership and to delegate such rights and powers by a
management agreement or another agreement with, or otherwise to, other persons.
Unless otherwise provided in this Agreement, such delegation by the General
Partner shall not cause the General Partner to cease to be a General Partner of
the Partnership.
5.2 RIGHT TO RELY ON GENERAL PARTNER.
(a) Any Person dealing with the Partnership may rely (without duty
of further inquiry) upon a certificate signed by the General Partner as to:
(i) The identity of the General Partner or any Limited
Partners;
(ii) The existence or nonexistence of any fact or facts which
constitute a condition precedent to acts by the General Partner or which are in
any other manner germane to the affairs of the Partnership;
(iii) The Persons who are authorized to execute and deliver
any instrument or document of the Partnership; or
(iv) Any act or failure to act by the Partnership or any other
matter whatsoever involving the Partnership or any Partner.
(b) The signature of the General Partner or its delegate(s) shall be
necessary and sufficient to convey title to any real property owned by the
Partnership or to execute any promissory notes, trust deeds, mortgages, or other
instruments of hypothecation, and all of the Partners agree that a copy of this
Agreement may be shown to the appropriate parties in order to confirm the same,
and further agree that the signature of the General Partner shall be sufficient
to execute any "statement of partnership" or other documents necessary to
effectuate this or any other provision of this Agreement. All of the Partners do
hereby appoint the General Partner as their attorney-in-fact for the execution
of any or all of the documents described in this Section 5.2(b).
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5.3 RESTRICTIONS ON AUTHORITY OF GENERAL PARTNER.
(a) The General Partner shall not have the authority to, and
covenants and agrees that it shall not, do any of the following acts without the
unanimous consent of the Partners:
(i) Cause or permit the Partnership to engage in any activity
that is not consistent with the purposes of the Partnership as set forth in
Section 1.3 hereof;
(ii) Knowingly do any act in contravention of this Agreement;
(iii) Knowingly do any act which would make it impossible to
carry on the ordinary business of the Partnership, except as otherwise provided
in this Agreement;
(iv) Confess a judgment against the Partnership;
(v) Possess Property, or assign rights in specific Property,
for other than a Partnership purpose;
(vi) Knowingly perform any act that would subject any Limited
Partner to liability as a general partner in any jurisdiction;
(vii) Cause the Partnership to voluntarily take any action
that would cause a Bankruptcy of the Partnership;
(viii) Cause the Partnership to acquire any equity or debt
securities of the General Partner or any of its Affiliates, or otherwise make
loans to the General Partner or any of its Affiliates;
(ix) Cause the Partnership to admit any additional Limited
Partners; and
(b) The General Partner shall not have the authority to, and
covenants and agrees that it shall not, without the consent of a majority of the
Partners, sell or otherwise dispose of all or substantially all of the Property,
except for a liquidating sale of Property in connection with the dissolution of
the Partnership.
5.4 DUTIES AND OBLIGATIONS OF GENERAL PARTNER.
(a) The General Partner or its delegate(s) shall cause the
Partnership to conduct its business and operations separate and apart from that
of the General Partner or any of its Affiliates, including, without limitation,
(i) segregating Partnership assets and not allowing funds or
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other assets of the Partnership to be commingled with the funds or other assets
of, held by, or registered in the name of, the General Partner or any of its
Affiliates, (ii) maintaining books and financial records of the Partnership
separate from the books and financial records of the General Partner and its
Affiliates, and observing all Partnership procedures and formalities, including,
without limitation, maintaining minutes of Partnership meetings and acting on
behalf of the Partnership only pursuant to due authorization of the Partners,
(iii) causing the Partnership to pay its liabilities from assets of the
Partnership, and (iv) causing the Partnership to conduct its dealings with third
parties in its own name and as a separate and independent entity.
(b) The General Partner shall take all actions which may be
necessary or appropriate (i) for the continuation of the Partnership's valid
existence as a limited partnership under the laws of the State of Delaware and
of each other jurisdiction in which such existence is necessary to protect the
limited liability of the Limited Partners or to enable the Partnership to
conduct the business in which it is engaged and (ii) for the accomplishment of
the Partnership's purposes, including the acquisition, development, maintenance,
preservation, and operation of Property in accordance with the provisions of
this Agreement and applicable laws and regulations.
(c) The General Partner shall be under a fiduciary duty to conduct
the affairs of the Partnership in the best interests of the Partnership and of
the Limited Partners, including the safekeeping and use of all of the Property
and the use thereof for the exclusive benefit of the Partnership.
(d) The General Partner shall cause to be provided, or cause the
Partnership to carry, such insurance as is customary in the business in which
the Partnership is engaged and in the places in which it is so engaged.
5.5 INDEMNIFICATION OF GENERAL PARTNER.
(a) The Partnership, its receiver, or its trustee (in the case of
its receiver or trustee, to the extent of Partnership Property) shall indemnify,
save harmless, and pay all judgments and claims against the General Partner or
any officers or directors of the General Partner or the Partnership relating to
any liability or damage incurred by reason of any act performed or omitted to be
performed by the General Partner, officer or director in connection with the
business of the Partnership, including attorneys' fees incurred by the General
Partner, officer or director in connection with the defense of any action based
on any such act or omission, which attorneys' fees may be paid as incurred,
including all such liabilities under federal and state securities laws
(including the Securities Act of 1933, as amended) as permitted by law.
(b) The Partnership, its receiver, or its trustee (in the case of
its receiver or trustee, to the extent of Partnership Property) shall indemnify
and hold harmless, to the maximum extent permitted by law, the General Partner
and Interest Holder from and against any and all liabilities, sums paid in
settlement of claims (if such settlement is consented to by the General
Partner), obligations, charges, actions (formal or informal), claims (including,
without limitation claims for personal injury under any
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theory or for real or personal property damage), liens, taxes, administrative
proceedings, losses, damages (including, without limitation, punitive damages),
penalties, fines, court costs, administrative service fees, response and
remediation costs, stabilization costs, encapsulation costs, treatment, storage
or disposal costs, groundwater monitoring or environmental study, sampling or
monitoring costs, other causes of action, and any other costs and reasonable
expenses (including, without limitation, reasonable attorneys' experts', and
consultants' fees and disbursements and investigating, laboratory and data
review fees) imposed upon or incurred by the General Partner or Interest Holder
(whether or not indemnified against by any other party) arising from and after
the date of this Agreement directly or indirectly out of:
(i) the past, present, or future treatment, storage, disposal,
generation, use, transport, movement, presence, release, threatened release,
spill, installation, sale, emission, injection, leaching, dumping, escaping, or
seeping of any Hazardous Substances, material containing or alleged to contain
Hazardous Substances at or from any past, present, or future properties or
assets of the Partnership; and/or
(ii) the violation or alleged violation by the Partnership or
any third party of any Environmental Laws with regard to the past, present, or
future ownership, operation, use, or occupying of any property or asset of the
Partnership.
(c) In the event of any action by an Interest Holder against any
officer or the General Partner, including a Partnership derivative suit, the
Partnership shall indemnify, save harmless, and pay all expenses of the officer
or General Partner, including attorneys' fees, incurred in the defense of such
action, if such officer or General Partner is successful in such action.
(d) The Partnership shall indemnify, save harmless, and pay all
expenses, costs, or liabilities of the General Partner who for the benefit of
the Partnership makes any deposit, acquires any option, or makes any other
similar payment or assumes any obligation in connection with any property
proposed to be acquired by the Partnership and who suffers any financial loss as
the result of such action.
(e) Notwithstanding the provisions of Sections 5.5(a), 5.5(b),
5.5(c), and 5.5(d) above, no officer, General Partner or Interest Holder shall
be indemnified from any liability for fraud, bad faith, willful misconduct, or
gross negligence.
(f) Notwithstanding anything to the contrary in any of Sections
5.5(a), 5.5(b), 5.5(c), and 5.5(d) above, in the event that any provision in any
of such Sections is determined to be invalid in whole or in part, such Section
shall be enforced to the maximum extent permitted by law.
5.6 COMPENSATION AND LOANS.
(a) Compensation and Reimbursement. Except as otherwise provided in
this Section 5.6, no Partner shall receive any salary, fee, or draw for services
rendered
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to or on behalf of the Partnership, nor shall any Partner be reimbursed for any
expenses incurred by such Partner on behalf of the Partnership.
(b) Expenses. The General Partner may charge the Partnership for any
direct expenses reasonably incurred in connection with the Partnership's
business.
(c) Loans. Any Person may, with the consent of the General Partner,
lend or advance money to the Partnership. If any Partner shall make any loan or
loans to the Partnership or advance money on its behalf, the amount of any such
loan or advance shall not be treated as a Capital Contribution but shall be a
debt due from the Partnership. The amount of any such loan or advance by a
lending Partner shall be repayable out of the Partnership's cash and shall bear
interest at such rate as the General Partner and the lending Partner shall agree
but not in excess of the maximum rate permitted by law. If the General Partner,
or an Affiliate of the General Partner, is the lending Partner, the rate of
interest shall be determined by the General Partner taking into consideration,
without limitation, prevailing interest rates and the interest rates the lender
is required to pay in the event such lender has itself borrowed funds to loan or
advance to the Partnership and the terms and conditions of such loan, including
the rate of interest, shall be no less favorable to the Partnership than if the
lender had been an independent third party. None of the Partners shall be
obligated to make any loan or advance to the Partnership.
5.7 TEMPORARY INVESTMENTS. All Property in the form of cash not otherwise
invested shall be deposited for the benefit of the Partnership in one or more
accounts of the Partnership or any of its Affiliates, maintained in such
financial institutions as the General Partners shall determine or shall be
invested in short-term liquid securities or other cash-equivalent assets or
shall be left in escrow, and withdrawals shall be made only in the regular
course of Partnership business on such signature or signatures as the General
Partner may determine from time to time.
SECTION 6
ROLE OF LIMITED PARTNERS
6.1 RIGHTS OR POWERS. The Limited Partners shall not have any right or
power to take part in the management or control of the Partnership or its
business affairs or to act for or bind the Partnership in any way.
6.2 VOTING RIGHTS. The Limited Partners shall have the right to vote on
the matters specifically reserved for their approval or consent which are set
forth in this Agreement.
6.3 PROCEDURE FOR CONSENT. In any circumstances requiring the approval or
consent of the Limited Partners as specified in this Agreement, such approval or
consent shall, except as expressly provided to the contrary in this Agreement,
be given or withheld in the sole and absolute discretion of the Limited Partners
and conveyed in writing to the General Partner not later than thirty (30) days
after such approval or
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consent was requested by the General Partner. The General Partner may require
response within a shorter time, but not less than ten (10) Business Days. A
failure to respond in any such time period shall constitute a vote which is
consistent with the General Partner's recommendation with respect to the
proposal. If the General Partner receives the necessary approval or consent of
the Limited Partners to such action, the General Partner shall be authorized and
empowered to implement such action without further authorization by the Limited
Partners.
SECTION 7
REPRESENTATIONS AND WARRANTIES
7.1 IN GENERAL. As of the date hereof, each of the Partners hereby makes
each of the representations and warranties applicable to such Partner as set
forth in Section 7.2 hereof, and such warranties and representations shall
survive the execution of this Agreement.
7.2 REPRESENTATIONS AND WARRANTIES. Each Partner hereby represents and
warrants that:
(a) Due Incorporation or Formation; Authorization of Agreement. If
such Partner is a corporation or a partnership, it is duly organized or duly
formed, validly existing and in good standing under the laws of the jurisdiction
of its incorporation or formation and has the corporate or partnership power and
authority to own its property and carry on its business as owned and carried on
at the date hereof and as contemplated hereby. Such Partner is duly licensed or
qualified to do business and in good standing in each of the jurisdictions in
which the failure to be so licensed or qualified would have a material adverse
effect on its financial condition or its ability to perform its obligations
hereunder. Such Partner has the individual, corporate, or partnership power and
authority to execute and deliver this Agreement and to perform its obligations
hereunder and, if such partner is a corporation or partnership, the execution,
delivery, and performance of this Agreement has been duly authorized by all
necessary corporate or partnership action. This Agreement constitutes the legal,
valid, and binding obligation of such Partner.
(b) No Conflict With Restrictions; No Default. Neither the
execution, delivery and performance of this Agreement nor the consummation by
such Partner of the transactions contemplated hereby (i) will conflict with,
violate, or result in a breach of any of the terms, conditions or provisions of
any law, regulation, order, writ, injunction, decree, determination, or award of
any court, any governmental department, board, agency, or instrumentality,
domestic or foreign, or any arbitrator, applicable to such Partner or any of its
Wholly Owned Affiliates if such Partner is a corporation or partnership, (ii)
will conflict with, violate, result in a breach of, or constitute a default
under any of the terms, conditions or provisions of the articles of
incorporation, bylaws, or partnership agreement of such Partner or any of its
Wholly Owned Affiliates or of any material agreement or instrument to which such
Partner or any of its Wholly Owned Affiliates is a party or by which such
Partner or any of its Wholly Owned Affiliates is or
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may be bound or to which any of its material properties or assets is subject,
(iii) will conflict with, violate, result in a breach of, constitute a default
under (whether with notice or lapse of time or both), accelerate or permit the
acceleration of the performance required by, give to others any material
interest or rights, or require any consent, authorization or approval under any
indenture, mortgage, lease agreement or instrument to which such Partner or any
of its Wholly Owned Affiliates is a party or by which such Partner or any of its
Wholly Owned Affiliates is or may be bound, or (iv) will result in the creation
or imposition of any lien upon any of the material properties or assets of such
Partner or any of its Wholly Owned Affiliates.
(c) Governmental Authorizations. Any registration, declaration or
filing with, or consent, approval, license, permit or other authorization or
order by, any governmental or regulatory authority, domestic or foreign, that is
required in connection with the valid execution, delivery, acceptance and
performance by such Partner under this Agreement or the consummation by such
Partner of any transaction contemplated hereby has been completed, made or
obtained on or before the effective date of this Agreement.
(d) Litigation. There are no actions, suits, proceedings or
investigations pending or, to the knowledge of such Partner or any of its Wholly
Owned Affiliates, threatened against or affecting such Partner or any of its
Wholly Owned Affiliates or any of their properties, assets or businesses in any
court or before or by any governmental department, board, agency or
instrumentality, domestic or foreign, or any arbitrator which could, if
adversely determined (or, in the case of an investigation could lead to any
action, suit, or proceeding, which if adversely determined could) reasonably be
expected to materially impair such Partner's ability to perform its obligations
under this Agreement or to have a material adverse effect on the consolidated
financial condition of such Partner; and such Partner or any of its Wholly Owned
Affiliates has not received any currently effective notice of any default, and
such Partner or any of its Wholly Owned Affiliates is not in default, under any
applicable order, writ, injunction, decree, permit, determination, or award of
any court, any governmental department, board, agency, or instrumentality,
domestic or foreign, or any arbitrator which could reasonably be expected to
materially impair such Partner's ability to perform its obligations under this
Agreement or to have a material adverse effect on the consolidated financial
condition of such Partner.
(e) Investment Company Act; Public Utility Holding Company Act.
Neither such Partner nor any of its Affiliates is, nor will the Partnership as a
result of such Partner holding an interest in the Partnership be, an "investment
company" as defined in, or subject to regulation under, the Investment Company
Act of 1940. Neither such Partner nor any of its Affiliates is, nor will the
Partnership as a result of such partner holding an interest in the Partnership
be, a "holding company," "an affiliate of a holding company," or a "subsidiary
of a holding company" as defined in, or subject to regulations under, the Public
Utility Holding Company Act of 1935.
(f) Investigation. Such Partner is acquiring its interest in the
Partnership based upon its own investigation, and the exercise by such Partner
of its
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rights and the performance of its obligations under this Agreement will be based
upon its own investigation, analysis and expertise. Such Partner's acquisition
of its interest in the Partnership is being made for its own account for
investment, and not with a view to the sale or distribution thereof. In the case
of each Limited Partner, such Partner is a sophisticated investor possessing an
expertise in analyzing the benefits and risks associated with acquiring
investments that are similar to the acquisition of its interest in the
Partnership.
SECTION 8
BOOKS AND RECORDS
8.1 BOOKS AND RECORDS. The Partnership shall maintain at its principal
place of business separate books of accounts for the Partnership which shall
show a true and accurate record of all costs and expenses incurred, all changes
made, all credits made and received, and all income derived in connection with
the conduct of the Partnership and the operation of its business in accordance
with generally accepted accounting principles consistently applied, and, to the
extent inconsistent therewith, in accordance with this Agreement. Any Partner or
his designated representative shall have the right, at any reasonable time, to
have access to and inspect and copy the contents of such books or records.
8.2 REPORTS.
(a) In General. The General Partner shall be responsible for the
preparation of financial reports of the Partnership and the coordination of
financial matters of the Partnership with the Partnership's accountant.
(b) Annual Reports. Within ninety (90) days after the end of each
Fiscal Year and at such time as distributions are made to the Partners pursuant
to Section 13.2 hereof following the occurrence of a Liquidating Event, the
General Partner shall cause to be prepared and each Partner to be furnished with
financial statements, including the following:
(i) A copy of the balance sheet of the Partnership as of the
last day of such Fiscal Year;
(ii) A statement of income or loss for the Partnership for
such Fiscal Year; and
(iii) A statement of the Partners' Capital Accounts and
changes therein for such Fiscal Year.
8.3 TAX INFORMATION. Necessary tax information shall be delivered to each
Partner after the end of each Fiscal Year of the Partnership together with the
reports described in Section 8.2(b) hereof.
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SECTION 9
AMENDMENTS; MEETINGS
9.1 AMENDMENTS.
(a) Amendments to this Agreement may be proposed by any General
Partner or by the Limited Partner holding ten percent (10%) or more of the
Interests. Following such proposal, the General Partner shall submit to the
Limited Partners a verbatim statement of any proposed amendment, providing that
counsel for the Partnership shall have approved of the same in writing as to
form, and the General Partner shall include in any such submission a
recommendation as to the proposed amendment. The General Partner shall seek the
written vote of the Partners on the proposed amendment or shall call a meeting
to vote thereon and to transact any other business that it may deem appropriate.
A proposed amendment shall be adopted and be effective as an amendment hereto if
it receives the affirmative vote of a majority of the Partners.
(b) Notwithstanding Sections 6.3 and 9.1(a) hereof, this Agreement
shall not be amended without the consent of each Partner adversely affected if
such amendment would (i) convert a Limited Partner's interest in the Partnership
into a General Partner's interest, (ii) modify the limited liability of a
Limited Partner, or (iii) alter the interest of a Partner in Profits, Losses,
other items, or any Partnership distributions.
9.2 MEETINGS OF THE PARTNERS.
(a) Meetings of the Partners may be called by the General Partner
and shall be called upon the written request of Limited Partners holding ten
percent (10%) or more of the Interests. The call shall state the nature of the
business to be transacted. Notice of any such meeting shall be given to all
Partners not less than ten (10) Business Days nor more than thirty (30) days
prior to the date of such meeting. Partners may vote in person or by proxy at
such meeting. Whenever the vote or consent of Partners is permitted or required
under the Agreement, such vote or consent may be given at a meeting of Partners
or may be given in accordance with the procedure prescribed in Section 9.3
hereof. Except as otherwise expressly provided in the Agreement, the vote of a
majority of the Partners shall control.
(b) For the purpose of determining the Partners entitled to vote on,
or to vote at, any meeting of the partners or any adjournment thereof, the
General Partner or the Limited Partners requesting such meeting may fix, in
advance, a date as the record date for any such determination. Such date shall
not be more than thirty (30) days or less than ten (10) Business Days before any
such meeting.
(c) Each Limited Partner may authorize any Person or Persons to act
for him by proxy on all matters in which a Limited Partner is entitled to
participate,
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including waiving notice of any meeting, or voting or participating at a
meeting. Every proxy must be signed by the Limited Partner or his
attorney-in-fact. No proxy shall be valid after the expiration of eleven (11)
months from the date thereof unless otherwise provided in the proxy. Every proxy
shall be revocable at the pleasure of the Limited Partner executing it.
(d) Each meeting of Partners shall be conducted by the General
Partner or such other Person as the General partner may appoint pursuant to such
rules for the conduct of the meeting as the General partner or such other Person
deems appropriate.
9.3 UNANIMOUS CONSENT. The Partnership may take any action contemplated
under this Agreement if approved by the unanimous consent of the Partners acting
without meeting, such consent to be provided in writing, or by telephone or
facsimile, if such telephone conversation or facsimile is followed by a hard
copy of the telephone conservation or facsimilied communication sent by
registered or certified mail, postage and charges prepaid, addressed as
described in Section 15.1, or to such other address as such Person may from time
to time specify by notice to the Partners.
SECTION 10
TRANSFER OF INTERESTS
10.1 RESTRICTION ON TRANSFERS. The ownership and transferability of
interest in the Partnership, both general and limited, are restricted. Neither
record title nor beneficial ownership of a Limited Partner interest or a General
Partner interest may be transferred or encumbered without the unanimous consent
of the Partners. This Limited Partnership is formed by a closely-held group who
know and trust one another, who will have surrendered certain management rights
(in exchange for limited liability in the case of a Limited Partner) or assumed
sole management responsibility and risk (in the case of a General Partner) based
upon their relationship and trust. Capital is also material to the business and
objectives of the Partnership and its federal tax status. An unauthorized
transfer of a Partner's interest could create a substantial hardship to the
Partnership, jeopardize its capital base, and adversely affect its tax
structure. These restrictions upon ownership and transfer are not intended as a
penalty, but as a method to protect and preserve existing relationships based
upon trust and the Partnership's capital and its financial ability to continue.
SECTION 11
GENERAL PARTNER
11.1 ADDITIONAL GENERAL PARTNER. Except as provided in this Section 11 and
Section 13.1 hereof, no Person shall be admitted to the partnership as a General
Partner without the unanimous consent of the Partners.
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11.2 COVENANT NOT TO WITHDRAW, TRANSFER, OR DISSOLVE. Except as otherwise
permitted by this Agreement, the General Partner hereby covenants and agrees not
to (a) take any action to file a certificate of dissolution or its equivalent
with respect to itself, (b) take any action that would cause a Voluntary
Bankruptcy of such General Partner, (c) withdraw or attempt to withdraw from the
Partnership, (d) exercise any power under the Act to dissolve the Partnership,
(e) transfer all or any portion of the interest in the Partnership as a General
Partner (except as otherwise permitted pursuant to the terms and conditions set
forth in Section 10.1 hereof), or (f) petition for judicial dissolution of the
Partnership. Further, the General Partner hereby covenants and agrees to
continue to carry out the duties of the General partner hereunder until the
Partnership is dissolved and liquidated pursuant to Section 13 hereof.
SECTION 12
POWER OF ATTORNEY
12.1 GENERAL PARTNER AS ATTORNEY-IN-FACT. Each Limited Partner hereby
makes, constitutes, and appoints the General Partner and each successor General
Partner, with full power of substitution and resubstitution, his true and lawful
attorney-in-fact for him and in his name, place, and stead and for his use and
benefit, to sign, execute, certify, acknowledge, swear to, file, and record (a)
all certificates of limited partnership, amended name or similar certificate,
and other certificates and instruments (including counterparts of this
Agreement) which the General Partner may deem necessary or appropriate to be
filed by the Partnership under the laws of the State of Delaware or any other
states or jurisdiction in which the Partnership is doing or intends to do
business; (b) any and all amendments or changes to this Agreement and the
instruments described in (a), as now or hereafter amended, which the General
Partner may deem necessary or appropriate to effect a change or modification of
the Partnership in accordance with the terms of this Agreement, including,
without limitation, amendments or changes to reflect (i) the exercise by the
General Partner of any power granted to it under this Agreement; (ii) any
amendments adopted by the Partners in accordance with the terms of this
Agreement; (iii) the admission of any substituted Partner; and (iv) the
disposition by any Partner of its Interest; (c) all certificates of cancellation
and other instruments which the General Partner may deem necessary or
appropriate to effect the dissolution and termination of the Partnership
pursuant to the terms of this Agreement; and (d) any other instrument which is
now or may hereafter be required by law to be filed on behalf of the Partnership
or is deemed necessary or appropriate by the General Partner to carry out fully
the provisions of this Agreement in accordance with its terms. Each Limited
Partner authorizes each such attorney-in-fact to take any further action which
such attorney-in-fact shall consider necessary or advisable in connection with
any of the foregoing, hereby giving each such attorney-in-fact full power and
authority to do and perform each and every act or thing whatsoever requisite or
advisable to be done in connection with the foregoing as fully as such Limited
Partnership might or could do personally, and hereby ratifying and confirming
all that any such attorney-in-fact shall lawfully do or cause to be done by
virtue thereof or hereof.
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12.2 NATURE AS SPECIAL POWER. The power of attorney granted pursuant to
this Section 12:
(a) Is a special power of attorney coupled with an interest and is
irrevocable;
(b) May be exercised by any such attorney-in-fact by listing the
Limited Partners executing any agreement, certificate, instrument, or other
document with the single signature of any such attorney-in-fact acting as
attorney-in-fact for such Limited Partners; and
(c) Shall survive the death, disability, legal incapacity,
bankruptcy, insolvency, dissolution, or cessation of existence of a Limited
Partner and shall survive the delivery of an assignment by a Limited Partner of
the whole or a portion of his Interests, except that where the assignment is of
such Limited Partner's entire Interests and the assignee, with the consent of
the General Partner, is admitted as a substituted Limited Partner, the power of
attorney shall survive the delivery of such assignment for the sole purpose of
enabling any such attorney-in-fact to effect such substitution.
SECTION 13
DISSOLUTION AND WINDING UP
13.1 LIQUIDATING EVENTS. The Partnership shall dissolve and commence
winding up and liquidating upon the first to occur of any of the following
("Liquidating Events"):
(a) The transfer of any interest in the Partnership by a Limited
Partner or a General Partner;
(b) The sale of all or substantially all of the Property;
(c) The vote by Partners holding one hundred percent (100%) of the
Percentage Interests to dissolve, wind up, and liquidate the Partnership;
(d) The happening of any other event that makes it unlawful,
impossible, or impractical to carry on the business of the Partnership; or
(e) The withdrawal or removal of the General Partner, the assignment
by the General Partner of its entire interest in the Partnership or any other
event that causes the General Partner to cease to be the general partner under
the Act.
In the event of the occurrence of a Liquidating Event, one hundred percent
(100%) of the remaining Partners may elect to reconstitute the Partnership and
continue its business on the same terms and conditions set forth in this
Agreement by forming a new limited partnership on terms identical to those set
forth in this Agreement and having as a general
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partner a Person elected by the unanimous consent of all of the remaining
Partners. Upon any such election by unanimous consent of the Partners, all
Partners shall be bound thereby and shall be deemed to have consented thereto.
Unless such an election is made within (90) days of the occurrence of an event
specified in Section 13.1(e) (the "Reconstitution Period"), the Partnership
shall wind up its affairs in accordance with Section 13.2 hereof. If such an
election is made within the Reconstitution Period, then:
(i) The reconstituted limited partnership shall continue the
occurrence of a Liquidating Event as provided in this Section 13.1;
(ii) If the successor general partner is not a former General
Partner, then the interest in the Partnership of any former General Partner
shall be treated thenceforth as the interest of a Limited Partner; and
(iii) All necessary steps shall be taken to cancel this
Agreement and the Certificate and to enter into a new partnership agreement and
certificate of limited partnership, and the successor general partner may for
this purpose exercise the powers of attorney granted the General Partner
pursuant to Section 14 hereof; provided that the right of one hundred percent
(100%) of the Partners to select a successor general partner and to reconstitute
and continue the business of the Partnership shall not exist and may not be
exercised unless the Partnership has received an opinion of counsel that the
exercise of right would not result in the loss of limited liability of any
Limited Partner and neither the Partnership nor the reconstituted partnership
would cease to be treated as a partnership for federal income tax purposes upon
the exercise of such right to continue.
13.2 WINDING UP. Upon the occurrence of a Liquidating Event, the
Partnership shall continue solely for the purpose of winding up its affairs in
an orderly manner, liquidating its assets, and satisfying the claims of its
creditors and Partners and no Partner shall take any action that is inconsistent
with, or not necessary to or appropriate for, the winding up of the
Partnership's business and affairs. To the extent not inconsistent with the
foregoing, all covenants and obligations in this Agreement shall continue in
full force and effect until such time as the partnership Property has been
distributed pursuant to this Section 13.2 and the Certificate has been canceled
in accordance with the Act. The General Partner (or, in the event there is no
remaining General Partner, any Person elected by a majority of the Limited
Partners) shall be responsible for overseeing the winding up and dissolution of
the Partnership, shall take full account of the Partnership's liabilities and
Property, shall cause the Partnership Property to be liquidated as promptly as
is consistent with obtaining the fair value thereof, and shall cause the
proceeds therefrom, to the extent sufficient therefor, to be applied and
distributed in the following order:
(a) First, to the payment and discharge of all of the Partnership's
debts and liabilities to creditors other than the General Partner;
(b) Second, to the payment and discharge of all of the Partnership's
debts and liabilities to the General Partner;
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(c) The balance, if any, to the General Partner and Interest Holders
in accordance with their Capital Accounts, after giving effect to all
contributions, distributions, and allocations for all periods.
No General Partner shall receive any additional compensation for any services
performed pursuant to this Section 13. The General Partner understands and
agrees that by accepting the provisions of this Section 13.2 setting forth the
priority of the distribution of the assets of the Partnership to be made upon
its liquidation, the General Partner expressly waives any right which it, as a
creditor of the Partnership might otherwise have under the Act to receive
distributions of assets pari passu with the other creditors of the Partnership
in connection with a distribution of assets of the Partnership in satisfaction
of any liability of the Partnership, and hereby subordinates to said creditors
any such right.
13.3 COMPLIANCE WITH CERTAIN REQUIREMENTS OF REGULATIONS; DEFICIT CAPITAL
ACCOUNTS.
In the event the Partnership is "liquidated" within the meaning of
Regulations Section 1.704-1(b)(2)(ii)(g), (a) distributions shall be made
pursuant to this Section 13 to the General Partner and Interest Holders who have
positive Capital Accounts in compliance with Regulations Section
1.704-1(b)(2)(ii)(b)(2), and (b) if the General Partner's Capital Account has a
deficit balance (after giving effect to all contributions, distributions, and
allocations for all Fiscal Years, including the Fiscal Year during which such
liquidation occurs), the General Partner shall contribute to the capital of the
Partnership the amount necessary to restore such deficit balance to zero in
compliance with Regulations Section 1.704-1(b)(2)(ii)(b)(3). If any Interest
Holder has a deficit balance in his Capital Account (after giving effect to all
contributions, distributions, and allocations for all Fiscal Years, including
the Fiscal Year during which such liquidation occurs), such Interest Holder
shall have no obligation to make any contribution to the capital of the
Partnership with respect to such deficit, and such deficit shall not be
considered a debt owed to the Partnership or to any other Person for any purpose
whatsoever. In the discretion of the General Partner, a pro rata portion of the
distributions that would otherwise be made to the General Partner and Interest
Holder pursuant to this Section 13 may be:
(a) distributed to a trust established for the benefit of the
General Partner and Interest Holders for the purposes of liquidating Partnership
assets, collecting amounts owed to the Partnership, and paying any contingent or
unforeseen liabilities or obligations of the Partnership or of the General
Partner arising out of or in connection with the Partnership. The assets of any
such trust shall be distributed to the General Partner and Interest Holders from
time to time, in the reasonable discretion of the General Partner, in the same
proportions as the amount distributed to such trust by the Partnership would
otherwise have been distributed to the General Partner and Interest Holders
pursuant to Section 13.2 hereof; or
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(b) withheld to provide a reasonable reserve for Partnership
liabilities (contingent or otherwise) and to reflect the unrealized portion of
any installment obligations owed to the Partnership, provided that such withheld
amounts shall be distributed to the General Partner and Interest Holders as soon
as practicable.
13.4 DEEMED DISTRIBUTION AND RECONTRIBUTION. Notwithstanding any other
provision of this Section 13, in the event the Partnership is liquidated within
the meaning of Regulations Section 1.704-1(b)(2)(ii)(g) but no Liquidating Event
has occurred, the Property shall not be liquidated, the Partnership's
liabilities shall not be paid or discharged, and the Partnership's affairs shall
not be wound up. Instead, solely for federal income tax purposes, the
Partnership shall be deemed to have distributed the Property in kind to the
General Partner and Interest Holders, who shall be deemed to have assumed and
taken subject to all Partnership liabilities, all in accordance with their
respective Capital Accounts and if the General Partner's Capital Account has a
deficit balance (after giving effect to all contributions, distributions, and
allocations for all Fiscal Years, including the Fiscal Year during which such
liquidation occurs) the General Partner shall contribute to the capital of the
Partnership the amount necessary to restore such deficit balance to zero in
compliance with Regulations Section 1.704-1(b)(2)(ii)(b)(3). Immediately
thereafter, the General Partner and Interest Holders shall be deemed to have
recontributed the Property in kind to the Partnership, which shall be deemed to
have assumed and taken subject to all such liabilities.
13.5 RIGHTS OF GENERAL PARTNER INTEREST HOLDERS. Except as otherwise
provided in this Agreement (a) the General Partner and Interest Holder shall
look solely to the assets of the Partnership for the return of his Capital
Contribution and shall have no right or power to demand or receive property
other than cash from the Partnership, and (b) no Interest Holder shall have
priority over any other Interest Holder as to the return of his Capital
Contributions, distributions, or allocations.
13.6 NOTICE OF DISSOLUTION. In the event a Liquidating Event occurs or an
event occurs that would, but for provisions of Section 13.1, result in
dissolution of the Partnership, the General Partner shall, within 30 days
thereafter, provide written notice thereof to each of the Partners and to all
other parties with whom the Partnership regularly conducts business (as
determined in the discretion of the General Partner) and shall publish notice
thereof in a newspaper of general circulation in each place in which the
Partnership regularly conducts business (as determined in the sole discretion of
the General Partner).
SECTION 14
MISCELLANEOUS
14.1 NOTICES. Any notice, payment, demand, or communication required or
permitted to be given by any provision of this Agreement shall be in writing and
sent by overnight courier, or by telephone or facsimile, if such telephone
conversation or facsimile is followed by a hard copy of the telephone
conversation or facsimilied
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communication sent by overnight courier, charges prepaid and addressed as
follows, or to such other address as such Person may from time to time specify
by notice to the Partners:
(a) If to the Partnership, to the Partnership at the address set
forth in Section 1.4 hereof;
(b) If to the General Partner, to the address set forth opposite its
name on Exhibit A attached hereto; and
(c) If to a Limited Partner, to the address set forth opposite its
name on Exhibit A attached hereto.
Any such notice shall be deemed to be delivered, given, and received for all
purposes as of the date so delivered.
14.2 BINDING EFFECT. Except as otherwise provided in this Agreement, every
covenant, term, and provision of this Agreement shall be binding upon and inure
to the benefit of the Partners and their respective heirs, legatees, legal
representatives, successors, transferees, and assigns.
14.3 CONSTRUCTION. Every covenant, term, and provision of this Agreement
shall be construed simply according to its fair meaning and not strictly for or
against any Partner. The terms of this Agreement are intended to embody the
economic relationship among the Partners and shall not be subject to
modification by, or be conformed with, any actions by the Internal Revenue
Service except as this Agreement may be explicitly so amended as may relate
specifically to the filing of tax returns.
14.4 TIME. Time is of the essence with respect to this Agreement.
14.5 HEADINGS. Section and other headings contained in this Agreement are
for reference purposes only and are not intended to describe, interpret, define,
or limit the scope, extent, or intent of this Agreement or any provision hereof.
14.6 SEVERABILITY. Every provision of this Agreement is intended to be
severable. If any term or provision hereof is illegal or invalid for any reason
whatsoever, such illegality or invalidity shall not affect the validity or
legality of the remainder of this Agreement.
14.7 INCORPORATION BY REFERENCE. Every exhibit, schedule, and other
appendix attached to this Agreement and referred to herein is not incorporated
in this Agreement by reference unless this Agreement expressly otherwise
provides.
14.8 FURTHER ACTION. Each Partner, upon the request of any General
Partner, agrees to perform all further acts and execute, acknowledge, and
deliver any documents
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which may be reasonably necessary, appropriate, or desirable to carry out the
provision of this Agreement.
14.9 VARIATION OF PRONOUNS. All pronouns and any variations thereof shall
be deemed to refer to masculine, feminine, or neuter, singular or plural, as the
identity of the person or persons may require.
14.10 GOVERNING LAW. The laws of the State of Delaware shall govern the
validity of this Agreement, the construction of its terms, and the
interpretation of the rights and duties of the Partners.
14.11 WAIVER OF ACTION FOR PARTITION; NO BILL FOR PARTNERSHIP ACCOUNTING.
Each of the Partners irrevocably waives any right that he may have to maintain
any action for partition with respect to any of the Property. To the fullest
extent permitted by law, each Partner covenants that it will not (except with
the consent of the General Partner) file a bill for Partnership accounting.
14.12 COUNTERPART EXECUTION. This Agreement may be executed in any number
of counterparts with the same effect as if all of the Partners has signed the
same document. All counterparts shall be construed together and shall constitute
one agreement.
14.13 SOLE AND ABSOLUTE DISCRETION. Except as otherwise provided in this
Agreement, all actions which the General Partner may take and all determinations
which the General Partner may make pursuant to this Agreement may be taken and
made at the sole and absolute discretion of the General Partner.
14.14 SPECIFIC PERFORMANCE. Each Partner agrees with the other Partners
that the other Partners would be irreparably damaged if any of the provisions of
this Agreement are not performed in accordance with their specific terms and
that monetary damages would not provide an adequate remedy in such event.
Accordingly, it is agreed that, in addition to any other remedy to which the
nonbreaching Partners may be entitled, at law or in equity, the nonbreaching
Partners shall be entitled to injunctive relief to prevent breaches of the
provisions of this Agreement and specifically to enforce the terms and
provisions hereof in any action instituted in any court of the United States or
any state thereof having subject matter jurisdiction thereof.
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IN WITNESS WHEREOF, the parties have entered into this Agreement of
Limited Partnership as of the day first above set forth.
TA OPERATING CORPORATION
By: /s/ James W. George
---------------------------------
Its: Senior Vice President and
Chief Financial Officer
("General Partner")
NATIONAL AUTO/TRUCKSTOPS, INC.
By: /s/ James W. George
---------------------------------
Its: Senior Vice President and
Chief Financial Officer
("Limited Partner")
TRAVELCENTERS REALTY, INC.
By: /s/ Andrew Panaccione
---------------------------------
Its: Secretary
("Limited Partner")
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EXHIBIT A
AGREEMENT OF LIMITED PARTNERSHIP
OF
TRAVELCENTERS PROPERTIES, L.P.
<TABLE>
<CAPTION>
===========================================================================================================
NAMES AND ADDRESS CAPITAL CONTRIBUTIONS % INTERESTS
-----------------------------------------------------------------------------------------------------------
<S> <C> <C>
GENERAL PARTNER:
TA OPERATING CORPORATION $ 407,450.00 1%
24601 Center Ridge Road
Suite 200
Westlake, Ohio 44145-5634
-----------------------------------------------------------------------------------------------------------
LIMITED PARTNER:
TRAVELCENTERS REALTY, INC. See attached Exhibit B 61%
Suite 200
103 Foulk Road
Wilmington, Delaware, 19803
-----------------------------------------------------------------------------------------------------------
LIMITED PARTNER:
NATIONAL AUTO/TRUCKSTOPS, INC. See attached Exhibit C 38%
Suite 200
103 Foulk Road
Wilmington, Delaware, 19803
===========================================================================================================
</TABLE>
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EXHIBIT B
CAPITAL CONTRIBUTIONS OF LIMITED PARTNER
OF
TRAVELCENTERS PROPERTIES, L.P.
All right, title and interest in and to the following properties:
Amarillo TravelCenter
1000 South FM 1912
Amarillo, Texas 79118-7014
Baytown TravelCenter
6800 Thompson Road
Baytown, Texas 77522
Dallas TravelCenter
2614 Big Town Blvd.
Mesquite, Texas 75150-2404
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EXHIBIT C
CAPITAL CONTRIBUTIONS OF LIMITED PARTNER
OF
TRAVELCENTERS PROPERTIES, L.P.
All right, title and interest in and to the following properties:
Twin City East 76 Travel Center
713 Highway 12
Hudson, Wisconsin 54016-0630
Madison TravelCenter
5901 Highway 51
De Forest, Wisconsin 53532
40
