<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 2)*
CHICO'S FAS, INC.
- --------------------------------------------------------------------------------
(Name of Issuer)
Common Stock
- --------------------------------------------------------------------------------
(Title of Class of Securities)
168615 10 2
- --------------------------------------------------------------------------------
(CUSIP Number)
Gary I. Teblum, Esq.
Trenam, Kemker, Scharf, Barkin,
Frye, O'Neill & Mullis, P.A.
2700 Barnett Plaza
Tampa, Florida 33602
813-223-7474
- --------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications)
March 8, 1995, December 22, 1995, October 20, 1998, October
22, 1998, October 23, 1998 and November 5, 1998
- --------------------------------------------------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e),3d-1(f) or 13d-1(g), check the following
box [].
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required in the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act,
but shall be subject to all other provisions of the Act (however, see the
Notes).
(Page 1 of 21 Pages)
<PAGE> 2
SCHEDULE 13D
CUSIP NO. 168615 10 2 PAGE 2 OF 21 PAGES
---------------- -------- --------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
RODIN, LTD.
------------------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ X ]
(b) [ ]
------------------------------------------------------------------------
(3) SEC USE ONLY
------------------------------------------------------------------------
SOURCE OF FUNDS*
(4) NOT APPLICABLE
------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
(6) TEXAS LIMITED PARTNERSHIP
------------------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES -0-
BENEFICIALLY ----------------------------------------------------
OWNED BY EACH
REPORTING (8) SHARED VOTING POWER
PERSON
WITH 1,605,128
----------------------------------------------------
(9) SOLE DISPOSITIVE POWER
-0-
----------------------------------------------------
(10) SHARED DISPOSITIVE POWER
1,605,128
----------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,605,128
------------------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
------------------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.4%
------------------------------------------------------------------------
(14) TYPE OF REPORTING PERSON*
PN
------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE> 3
SCHEDULE 13D
CUSIP NO. 168615 10 2 PAGE 3 OF 21 PAGES
---------------- -------- --------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
KLEE & CO., L.L.C.
------------------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ X ]
(b) [ ]
------------------------------------------------------------------------
(3) SEC USE ONLY
------------------------------------------------------------------------
SOURCE OF FUNDS*
(4) NOT APPLICABLE
------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
(6) TEXAS LIMITED LIABILITY COMPANY
------------------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES -0-
BENEFICIALLY ----------------------------------------------------
OWNED BY EACH
REPORTING (8) SHARED VOTING POWER
PERSON
WITH 1,605,128
----------------------------------------------------
(9) SOLE DISPOSITIVE POWER
-0-
----------------------------------------------------
(10) SHARED DISPOSITIVE POWER
1,605,128
----------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,605,128
------------------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
------------------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.4%
------------------------------------------------------------------------
(14) TYPE OF REPORTING PERSON*
CO
------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE> 4
SCHEDULE 13D
CUSIP NO. 168615 10 2 PAGE 4 OF 21 PAGES
---------------- -------- --------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
HELENE B. GRALNICK TRUST AGREEMENT
------------------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ X ]
(b) [ ]
------------------------------------------------------------------------
(3) SEC USE ONLY
------------------------------------------------------------------------
SOURCE OF FUNDS*
(4) NOT APPLICABLE
------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
(6) FLORIDA REVOCABLE TRUST
------------------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES -0-
BENEFICIALLY ----------------------------------------------------
OWNED BY EACH
REPORTING (8) SHARED VOTING POWER
PERSON WITH
-0-
----------------------------------------------------
(9) SOLE DISPOSITIVE POWER
-0-
----------------------------------------------------
(10) SHARED DISPOSITIVE POWER
-0-
----------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
-0-
------------------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
------------------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.0%
------------------------------------------------------------------------
(14) TYPE OF REPORTING PERSON*
OO
------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE> 5
SCHEDULE 13D
CUSIP NO. 168615 10 2 PAGE 5 OF 21 PAGES
---------------- -------- --------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
HELENE B. GRALNICK
------------------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ X ]
(b) [ ]
------------------------------------------------------------------------
(3) SEC USE ONLY
------------------------------------------------------------------------
SOURCE OF FUNDS*
(4) NOT APPLICABLE
------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
(6) U.S.A.
------------------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES 23,333(1)
BENEFICIALLY ----------------------------------------------------
OWNED BY EACH
REPORTING (8) SHARED VOTING POWER
PERSON WITH
1,605,128
----------------------------------------------------
(9) SOLE DISPOSITIVE POWER
23,333(1)
----------------------------------------------------
(10) SHARED DISPOSITIVE POWER
1,605,128
----------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,628,461
------------------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
------------------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.7%
------------------------------------------------------------------------
(14) TYPE OF REPORTING PERSON*
IN
------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE> 6
SCHEDULE 13D
CUSIP NO. 168615 10 2 PAGE 6 OF 21 PAGES
---------------- -------- --------
(1) REPRESENTS OPTIONS TO PURCHASE SHARES OF COMMON STOCK GRANTED UNDER THE
COMPANY'S STOCK OPTION PLANS.
<PAGE> 7
SCHEDULE 13D
CUSIP NO. 168615 10 2 PAGE 7 OF 21 PAGES
---------------- -------- --------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
MARVIN J. GRALNICK TRUST AGREEMENT
------------------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ X ]
(b) [ ]
------------------------------------------------------------------------
(3) SEC USE ONLY
------------------------------------------------------------------------
SOURCE OF FUNDS*
(4) NOT APPLICABLE
------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
(6) FLORIDA REVOCABLE TRUST
------------------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES -0-
BENEFICIALLY ----------------------------------------------------
OWNED BY EACH
REPORTING (8) SHARED VOTING POWER
PERSON
WITH -0-
----------------------------------------------------
(9) SOLE DISPOSITIVE POWER
-0-
----------------------------------------------------
(10) SHARED DISPOSITIVE POWER
-0-
----------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
-0-
------------------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
------------------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.0%
------------------------------------------------------------------------
(14) TYPE OF REPORTING PERSON*
OO
------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE> 8
SCHEDULE 13D
CUSIP NO. 168615 10 2 PAGE 8 OF 21 PAGES
---------------- -------- --------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
MARVIN J. GRALNICK
------------------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ X ]
(b) [ ]
------------------------------------------------------------------------
(3) SEC USE ONLY
------------------------------------------------------------------------
SOURCE OF FUNDS*
(4) NOT APPLICABLE
------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
(6) U.S.A.
------------------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES 48,333(1)
BENEFICIALLY ----------------------------------------------------
OWNED BY EACH
REPORTING (8) SHARED VOTING POWER
PERSON
WITH 1,605,128
----------------------------------------------------
(9) SOLE DISPOSITIVE POWER
48,333(1)
----------------------------------------------------
(10) SHARED DISPOSITIVE POWER
1,605,128
----------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,653,461
------------------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
------------------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
20%
------------------------------------------------------------------------
(14) TYPE OF REPORTING PERSON*
IN
------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE> 9
SCHEDULE 13D
CUSIP NO. 168615 10 2 PAGE 9 OF 21 PAGES
---------------- -------- --------
(1) REPRESENTS OPTIONS TO PURCHASE SHARES TO COMMON STOCK GRANTED UNDER THE
COMPANY'S STOCK OPTION PLANS.
<PAGE> 10
SCHEDULE 13D
CUSIP NO. 168615 10 2 PAGE 10 OF 21 PAGES
---------------- -------- --------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
CAPTIVA, LTD.
------------------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ X ]
(b) [ ]
------------------------------------------------------------------------
(3) SEC USE ONLY
------------------------------------------------------------------------
SOURCE OF FUNDS*
(4) NOT APPLICABLE
------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
(6) TEXAS LIMITED PARTNERSHIP
------------------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES -0-
BENEFICIALLY ----------------------------------------------------
OWNED BY EACH
REPORTING (8) SHARED VOTING POWER
PERSON
WITH -0-
----------------------------------------------------
(9) SOLE DISPOSITIVE POWER
-0-
----------------------------------------------------
(10) SHARED DISPOSITIVE POWER
-0-
----------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
-0-
------------------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
------------------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.0%
------------------------------------------------------------------------
(14) TYPE OF REPORTING PERSON*
PN
------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE> 11
SCHEDULE 13D
CUSIP NO. 168615 10 2 PAGE 11 OF 21 PAGES
---------------- -------- --------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
SARTRE PARTNERS, LTD.
------------------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ X ]
(b) [ ]
------------------------------------------------------------------------
(3) SEC USE ONLY
------------------------------------------------------------------------
SOURCE OF FUNDS*
(4) NOT APPLICABLE
------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
(6) TEXAS LIMITED PARTNERSHIP
------------------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES -0-
BENEFICIALLY ----------------------------------------------------
OWNED BY EACH
REPORTING PERSON (8) SHARED VOTING POWER
WITH -0-
----------------------------------------------------
(9) SOLE DISPOSITIVE POWER
-0-
----------------------------------------------------
(10) SHARED DISPOSITIVE POWER
-0-
----------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
-0-
------------------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
------------------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.0%
------------------------------------------------------------------------
(14) TYPE OF REPORTING PERSON*
PN
------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE> 12
SCHEDULE 13D PAGE 12 OF 21 PAGES
- --------------------------------------------------------------------------------
This Statement constitutes Amendment No. 2 to previously filed
Statements on Schedule 13D relating to the common stock, $.01 par value per
share (the "Common Stock"), of Chico's FAS, Inc., a Florida corporation (the
"Issuer"), as follows:
1. Schedule 13D filed on January 7, 1994 by Gralnick Industries
Limited Partnership, a Nevada limited partnership ("Gralnick
Industries"), the Helene B. Gralnick Trust Agreement (the
"Helene B. Gralnick Trust") and Helene B. Gralnick,
individually (the "Helene Gralnick Initial Statement").
2. Schedule 13D filed on January 7, 1994 by Gralnick Enterprises
Limited Partnership, a Nevada limited partnership ("Gralnick
Enterprises"), the Marvin J. Gralnick Trust Agreement (the
"Marvin J. Gralnick Trust") and Marvin J. Gralnick,
individually (the "Marvin Gralnick Initial Statement").
3. Amendment No. 1 to Schedule 13D filed on November 10, 1994
by Gralnick Industries, Helene B. Gralnick Trust, Helene B.
Gralnick, individually and as trustee, Gralnick Enterprises,
Marvin J. Gralnick Trust, and Marvin J. Gralnick, individually
and as trustee ("Amendment No. 1").
On or about March 8, 1995, Gralnick Industries was effectively merged
into and survived by Captiva, Ltd. ("Captiva"), a Texas limited partnership,
which partnership was beneficially owned by Marvin Gralnick and Helene Gralnick
(through the ownership by Marvin Gralnick and Helene Gralnick of 100% of the
membership interests in Klee & Co., L.L.C., a Texas limited liability company
which is serving as the sole general partner of Captiva), as was the case for
Gralnick Industries prior to the merger. On the same date, Gralnick Enterprises
was effectively merged into and survived by Sartre Partners, Ltd. ("Sartre"), a
Texas limited partnership, which partnership was beneficially owned by Marvin
Gralnick and Helene Gralnick (through the ownership by of Marvin Gralnick and
Helene Gralnick of 100% of the membership interests in Camus & Co., L.L.C., a
Texas limited liability company which is serving as the sole general partner of
Sartre), as was the case for Gralnick Industries prior to the merger. As a
result of these mergers, the Common Stock owned by Gralnick Industries was
transferred to Captiva, the Common Stock owned by Gralnick Enterprises was
transferred to Sartre and the Helene B. Gralnick Trust and the Marvin J.
Gralnick Trust no longer held any direct or indirect interest in the Common
Stock.
On or about December 22, 1995, through a series of contemporaneous
transfers, the Common Stock owned by Captiva and the Common Stock owned by
Sartre (aggregating 1,705,128 shares), while at all times remaining fully within
the control of Marvin Gralnick and Helene Gralnick, was transferred to a single,
newly-formed Texas limited partnership, Rodin, Ltd. ("Rodin"), which partnership
is controlled by Marvin Gralnick and Helene Gralnick (through the ownership by
Marvin Gralnick and Helene Gralnick of 100% of the membership interests in Klee
& Co., L.L.C., a Texas limited liability company which is serving as the sole
general partner of Rodin), and Captiva and Sartre no longer held any direct or
indirect interest in the Common Stock.
In October and November 1998, Rodin sold an aggregate of 100,000 shares
of the Common Stock in transactions effectuated through a broker, as follows:
<PAGE> 13
SCHEDULE 13D PAGE 13 OF 21 PAGES
- --------------------------------------------------------------------------------
Date of Transaction Number of Shares Sold Price Per Share
- ------------------------- --------------------------- ---------------------
October 20, 1998 25,000 $17.125
October 22, 1998 25,000 $16.750
October 23, 1998 10,000 $16.500
November 5, 1998 1,500 $19.000
November 5, 1998 20,000 $18.937
November 5, 1998 10,000 $19.125
November 5, 1998 8,500 $19.375
This Amendment No. 2 to Schedule 13D also relates to the vesting of
certain non-qualified stock options to purchase shares of Common Stock granted
to Helene B. Gralnick and Marvin J. Gralnick pursuant to the Company's stock
option plans.
As to Helene B. Gralnick, (1) all of 15,000 non-qualified stock options
granted to Ms. Gralnick on May 1, 1995 are currently vested, with 5,000 of such
options having vested on May 1, 1996, an additional 5,000 of such options having
vested on May 1, 1997 and the remaining 5,000 of such options having vested on
May 1, 1998, and (2) 8,333 of 25,000 non-qualified stock options granted to Ms.
Gralnick on May 13, 1997 are currently vested, such 8,333 options having vested
on May 13, 1998.
As to Marvin J. Gralnick, (1) all of 15,000 non-qualified stock options
granted to Mr. Gralnick on May 1, 1995 are currently vested, with 5,000 of such
options having vested on May 1, 1996, an additional 5,000 of such options having
vested on May 1, 1997 and the remaining 5,000 of such options having vested on
May 1, 1998, and (2) 33,333 of 100,000 non-qualified stock options granted to
Mr. Gralnick on May 13, 1997 are currently vested, such 33,333 options having
vested on May 13, 1998.
Accordingly, this Statement, as amended from time to time, shall now
serve, pursuant to the requirements of Rule 13d-1(k)(1) under the Securities
Exchange Act of 1934, as the Statement on Schedule 13D for (i) Rodin, (ii) Klee
& Co., L.L.C. ("Klee"), (iii) Helene B. Gralnick, and (iv) Marvin J. Gralnick.
The Helene B. Gralnick Trust, the Marvin J. Gralnick Trust, Captiva and Sartre
join in this amendment in order to acknowledge that each of them no longer holds
any direct or indirect interest in the Common Stock.
The Helene B. Gralnick Trust, Helene B. Gralnick, the Marvin J.
Gralnick Trust and Marvin J. Gralnick, in filing this Statement, each jointly
further amend and restate Amendment No. 1 and Rodin, Klee, Captiva and Sartre
hereby join in this Statement as follows:
<PAGE> 14
SCHEDULE 13D PAGE 14 OF 21 PAGES
- --------------------------------------------------------------------------------
ITEM 4. SECURITY AND ISSUER.
This Statement relates to the common stock, par value $.01 per share
(the "Common Stock") of Chico's FAS, Inc. (the "Issuer"). The address of the
principal executive offices of the Issuer is 11215 Metro Parkway, Ft. Myers,
Florida 33912.
ITEM 5. IDENTITY AND BACKGROUND.
This Statement is filed on behalf of (i) Rodin, (ii) Klee, (iii)
Helene B. Gralnick, and (iv) Marvin J. Gralnick.
RODIN
As indicated above, (1) on or about December 22, 1995, as a consequence
of several contemporaneous transfers, Rodin became the record owner of 1,705,128
shares of the Common Stock, and (2) as a result of a series of sales by Rodin
during October 1998, Rodin is currently the record owner of 1,605,128 shares of
the Common Stock. Klee is the sole general partner of Rodin. All of the
membership interests in Klee are owned by Marvin J. Gralnick and Helene B.
Gralnick. Marvin J. Gralnick, Helene B. Gralnick and certain irrevocable trusts
established by Marvin J. Gralnick and Helene B. Gralnick for the benefit of
certain of their children and other family members are the sole limited partners
of Rodin. None of the irrevocable trusts that are limited partners of Rodin
participate in any decisions concerning voting and/or disposition of the Common
Stock owned by Rodin. Because of their interest in the general partner, Marvin
J. Gralnick and Helene B. Gralnick may be considered to beneficially own all of
the general partnership interests of Rodin and thus all of the Common Stock
owned by Rodin.
CERTAIN INFORMATION ABOUT THE FILING PARTIES
Set forth below is background information about Rodin, Klee, Helene B.
Gralnick, Marvin J. Gralnick, Captiva and Sartre, including information as to
(a) the name, (b) address, (c) principal business or occupation, (d) whether or
not, during the past five years, such person has been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors), (e) whether
or not, during the past five years, such person was a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction and as
a result of such proceeding was or is subject to a judgment, decree or final
order enjoining future violations of, or prohibiting or mandating activities
subject to, Federal or State securities laws or finding and violations with
respect to such laws and (f) citizenship:
(1) Rodin, Ltd.
(a) Rodin, Ltd. is a Texas limited partnership.
(b) c/o Osborne, Lowe, Helman & Smith, L.L.P.
301 Congress Ave.
Suite 1900
Austin, TX 78701
<PAGE> 15
SCHEDULE 13D PAGE 15 OF 21 PAGES
- --------------------------------------------------------------------------------
(c) Rodin was formed to facilitate investment and/or
estate planning activities for its partners, Klee,
Marvin J. Gralnick, Helene B. Gralnick and certain
irrevocable trusts established by Marvin J. Gralnick
and Helene B. Gralnick for the benefit of certain of
their children and other family members.
(d) No.
(e) No.
(2) Klee & Co., L.L.C.
(a) Klee is a Texas limited liability company.
(b) c/o Osborne, Lowe, Helman & Smith, L.L.P.
301 Congress Ave.
Suite 1900
Austin, TX 78701
(c) Klee was originally formed to become the general
partner in the Texas limited partnership that holds
title to and controls the disposition of assets of
Captiva but as a result of the transfers occurring in
December 1995, has become the general partner of
Rodin.
(d) No.
(e) No.
(3) Helene B. Gralnick
(a) Helene B. Gralnick
(b) 11215 Metro Parkway
Ft. Myers, Florida 33912
(c) Senior Vice President - Design and Concept and a
director of Chico's FAS, Inc., 11215 Metro Parkway,
Ft. Myers, Florida 33912, a specialty retailer of
exclusively designed, private label casual clothing
and related accessories.
(d) No.
(e) No.
(f) USA.
<PAGE> 16
SCHEDULE 13D PAGE 16 OF 21 PAGES
- --------------------------------------------------------------------------------
(4) Marvin J. Gralnick
(a) Marvin J. Gralnick
(b) 11215 Metro Parkway
Ft. Myers, Florida 33912
(c) Chairman of the Board, Chief Executive Officer,
President, and a director of Chico's FAS, Inc., 11215
Metro Parkway, Ft. Myers, Florida 33912, a specialty
retailer of exclusively designed, private label
casual clothing and related accessories.
(d) No.
(e) No.
(f) USA.
(5) Captiva, Ltd.
(a) Captiva, Ltd. is a Texas limited partnership.
(b) c/o Osborne, Lowe, Helman & Smith, L.L.P.
301 Congress Ave.
Suite 1900
Austin, TX 78701
(c) Captiva was formed to facilitate investment and/or
estate planning activities for its partners,
including its sole general partner, Klee.
(d) No.
(e) No.
(6) Sartre Partners, Ltd.
(a) Sartre Partners, Ltd. is a Texas limited partnership.
(b) c/o Osborne, Lowe, Helman & Smith, L.L.P.
301 Congress Ave.
Suite 1900
Austin, TX 78701
<PAGE> 17
SCHEDULE 13D PAGE 17 OF 21 PAGES
- --------------------------------------------------------------------------------
(c) Sartre was formed to facilitate investment and/or
estate planning activities for its partners,
including its general partner, Camus & Co., L.L.C., a
Texas limited liability company (whose membership
interests were owned 100% by Marvin J. Gralnick and
Helene B. Gralnick).
(d) No.
(e) No.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Not Applicable. See "Purpose of Transaction".
ITEM 4. PURPOSE OF TRANSACTION.
TRANSACTIONS OCCURRING ON OR ABOUT MARCH 8, 1995, ON OR ABOUT DECEMBER 22, 1995
AND IN OCTOBER 1998
All of the transactions occurring on or about March 8, 1995, on or
about December 22, 1995 and in October 1998, were engaged in to facilitate
investment and/or estate planning activities for the respective parties to those
transactions. Insofar as the Common Stock of the Issuer is concerned, (i)
Captiva generally acquired and held the Common Stock of the Issuer as an equity
investment, as did Gralnick Industries prior to the merger, (ii) Sartre
generally acquired and held the Common Stock of the Issuer as an equity
investment, as did Gralnick Enterprises prior to the merger, and (iii) Rodin
generally acquired and continues to hold the Common Stock of the Issuer as an
equity investment, as did Captiva and Sartre prior to the December 1995
transactions.
Rodin or any of the persons who are considered for purposes of Rule
13d-3 to beneficially own the shares of Common Stock owned by Rodin may from
time to time in the future acquire additional securities of the Issuer,
including shares of the Common Stock. In addition, from time to time in the
future, Rodin and any of the persons who are considered for purposes of Rule
13d-3 to beneficially own the shares of Common Stock owned by Rodin may dispose
of securities of the Issuer, including shares of the Common Stock. Except as
noted otherwise in this paragraph, at the time of the acquisition, Rodin and the
persons who are considered for purposes of Rule 13d-3 to beneficially own the
shares of Common Stock owned by Rodin had, and at the present time Rodin and the
persons who are considered for purposes of Rule 13d-3 to beneficially own the
shares of Common Stock owned by Rodin continue to have, no independent plans or
proposals of the type specified in paragraphs (a) through (j) of Item 4 of the
Schedule 13D Instructions except that Marvin J. Gralnick and/or Helene B.
Gralnick may from time to time, for estate planning purposes, but without
obligation, transfer limited partner interests primarily to family members, to
irrevocable trusts established for the benefit of family members and to persons
in which family members have interests. The intentions of Rodin or any of the
persons who are considered for purposes of Rule 13d-3 to beneficially own the
shares of Common Stock owned by Rodin with respect to the Common Stock
<PAGE> 18
SCHEDULE 13D PAGE 18 OF 21 PAGES
- --------------------------------------------------------------------------------
of the Issuer may change at any time in the future, or from time to time in the
future. It is possible that in the future, or from time to time in the future,
Rodin or any of the persons who are considered for purposes of Rule 13d-3 to
beneficially own the shares of Common Stock owned by Rodin may independently
develop and implement or engage in one or more of the transactions of the type
specified in paragraphs (a) through (j) of Item 4 of the Schedule 13D
Instructions in addition to those which may arise in connection with Ms.
Gralnick's and Mr. Gralnick's current, regular, and customary service as
officers and directors of the Issuer and the possible exercise of outstanding
and vested stock options.
STOCK OPTIONS
The stock options held by Helene B. Gralnick and Marvin J. Gralnick
were granted under the Company's stock option plans, at the same time as stock
options were granted to other key employees of the Company, in each case to
provide incentive to the respective key employee to continue and increase their
respective efforts to improve operating results, to remain in the employ of the
Company and to have a greater financial interest in the Company. As a result of
the vesting of these options, Ms. Gralnick and Mr. Gralnick will each be able to
increase their respective ownership of stock in the Company upon exercise of
the respective options.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
Rodin is governed under the terms of the Limited Partnership Agreement
dated December 21, 1995, as amended (the "Rodin Agreement"). Under the terms of
the Rodin Agreement, the interests of the partners in Rodin, as of the execution
date of this Amendment, are: (1) Klee & Co., L.L.C. - 83.043 Units, (2) Marvin
J. Gralnick - 4,093.270 Units, (3) Helene B. Gralnick - 4,093.270 Units and (4)
Leslie C. Giordani, as the trustee of various irrevocable trusts established by
Marvin J. Gralnick and/or Helene B. Gralnick - - 34.39 Units in the aggregate.
Under the terms of the Rodin Agreement, Klee, in its capacity as the
sole general partner of Rodin, has the full and exclusive right and power to
manage and operate the business of Rodin, including the power to vote and
dispose of all shares of the Common Stock of the Issuer held by Rodin. Helene B.
Gralnick and Marvin J. Gralnick are the sole members of Klee. Therefore, Helene
B. Gralnick and Marvin J. Gralnick are considered for purposes of Rule 13d-3 to
beneficially own all of the shares of Common Stock owned by Rodin. Accordingly,
as a result of these relationships, Rodin, Klee, Helene B. Gralnick, and Marvin
J. Gralnick may be deemed to share the power to vote, direct the vote, dispose
of and direct the disposition of the 1,605,128 shares of the Common Stock of the
Issuer held by Rodin. Such shares represent 19.4% of the total outstanding
shares of the Common Stock of the Issuer as of November 10, 1998.
In addition, as described herein, Helene B. Gralnick has the option to
acquire 23,333 additional shares of Common Stock that she beneficially owns
pursuant to the terms of those options granted to Ms. Gralnick under the
Company's stock option plans that are currently vested. The shares underlying
the vested stock options held by Ms. Gralnick, together with the shares held by
<PAGE> 19
SCHEDULE 13D PAGE 19 OF 21 PAGES
- --------------------------------------------------------------------------------
Rodin, constitute 19.7% of the total outstanding shares of the Common Stock of
the Issuer as of November 10, 1998.
In addition, as described herein, Marvin J. Gralnick has the option to
acquire 48,333 additional shares of Common Stock that he beneficially owns
pursuant to the terms of those options granted to Mr. Gralnick under the
Company's stock option plans that are currently vested. The shares underlying
the vested stock options held by Mr. Gralnick, together with the shares held by
Rodin, constitute 20.0% of the total outstanding shares of the Common Stock of
the Issuer as of November 10, 1998.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
See "Item 5 Interest in Securities of the Issuer" for information
regarding the Rodin Agreement.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit 1. Certificate and Plan of Merger of Gralnick
Industries Limited Partnership with and into
Captiva, Ltd. dated March 8, 1995.
Exhibit 2. Certificate and Plan of Merger of Gralnick
Enterprises Limited Partnership with and
into Sartre Partners, Ltd. dated March 8,
1995.
Exhibit 3. Limited Partnership Agreement (re: Rodin)
dated December 21, 1995 together with 7
amendments thereto.
<PAGE> 20
SCHEDULE 13D PAGE 20 OF 21 PAGES
- --------------------------------------------------------------------------------
SIGNATURES
After reasonable inquiry and to the best of the knowledge and belief of
the undersigned, the undersigned certify that the information set forth in this
statement is true, complete and correct.
Dated: November 16, 1998
RODIN, LTD.
By: Klee & Co., L.L.C.,
General Partner
By: /s/ Marvin J. Gralnick
------------------------------------------
Marvin J. Gralnick, Manager
By: /s/ Helene B. Gralnick
------------------------------------------
Helene B. Gralnick, Manager
KLEE & CO., L.L.C.
By: /s/ Marvin J. Gralnick
---------------------------------------------------
Marvin J. Gralnick, Manager
By: /s/ Helene B. Gralnick
---------------------------------------------------
Helene B. Gralnick, Manager
HELENE B. GRALNICK TRUST AGREEMENT
By: /s/ Helene B. Gralnick
---------------------------------------------------
Helene B. Gralnick, Trustee
/s/ Helene B. Gralnick
- ------------------------------------------------------
Helene B. Gralnick, Individually
MARVIN J. GRALNICK TRUST AGREEMENT
By: /s/ Marvin J. Gralnick
---------------------------------------------------
Marvin J. Gralnick, Trustee
/s/ Marvin J. Gralnick
- ------------------------------------------------------
Marvin J. Gralnick, Individually
<PAGE> 21
SCHEDULE 13D PAGE 21 OF 21 PAGES
- --------------------------------------------------------------------------------
CAPTIVA, LTD.
By: Klee & Co., L.L.C.,
General Partner
By: /s/ Marvin J. Gralnick
---------------------------------------------------------
Marvin J. Gralnick, Manager
By: /s/ Helene B. Gralnick
---------------------------------------------------------
Helene B. Gralnick, Manager
SARTRE PARTNERS, LTD.
By: Camus & Co., L.L.C.,
General Partner
By: /s/ Marvin J. Gralnick
---------------------------------------------------------
Marvin J. Gralnick, Manager
By: /s/ Helene B. Gralnick
---------------------------------------------------------
Helene B. Gralnick, Manager
<PAGE> 22
EXHIBIT INDEX
Exhibit 1. Certificate and Plan of Merger of Gralnick Industries
Limited Partnership with and into Captiva, Ltd. dated
March 8, 1995.
Exhibit 2. Certificate and Plan of Merger of Gralnick
Enterprises Limited Partnership with and into Sartre
Partners, Ltd. dated March 8, 1995.
Exhibit 3. Limited Partnership Agreement (re: Rodin) dated
December 21, 1995 together with 7 amendments thereo.
<PAGE> 1
EXHIBIT 1
CERTIFICATE AND PLAN OF MERGER OF
GRALNICK INDUSTRIES LIMITED PARTNERSHIP
(a Nevada limited partnership)
with and into
CAPTIVA, LTD.
(a Texas limited partnership)
This Plan of Merger ("Plan") is entered into effective this the 8th day
of February, 1995, by and between Gralnick Industries Limited Partnership, a
Nevada limited partnership, ("Industries") and Captiva, Ltd., a Texas limited
partnership, ("Captiva"), and is as follows:
WITNESSETH
WHEREAS, Industries was formed as a Nevada limited partnership under
and pursuant to that certain Limited Partnership Agreement dated December 23,
1993 ("Industries Agreement"); and
WHEREAS, Captiva was formed as a Texas limited partnership under and
pursuant to that certain Limited Partnership Agreement dated February 8, 1995
("Captiva Agreement"); and
WHEREAS, acting pursuant to Section 2.11 of the Texas Revised Limited
Partnership Act (the "Act"), all partners, general and limited, of Industries
and Captiva have approved and consented to the Plan set forth below under which
Industries will be merged with and into Captiva, and Captiva will be the
surviving limited partnership:
NOW, THEREFORE, it is agreed as follows:
1. The name and domicile of each party to this Plan are as
follows:
Gralnick Industries Limited Partnership
Nevada
Captiva, Ltd.
Texas
The name and domicile of the limited partnership which will survive the merger
are:
Captiva, Ltd.
Texas
2. The terms and conditions of the Plan are as follows:
The values of the respective properties and assets of Industries and Captiva
have been determined
<PAGE> 2
and agreed upon by all partners, general and limited, of each partnership. All
partners of Industries, general and limited, shall become limited partners in
Captiva. The partners of Industries will be deemed to have contributed property
to Captiva, in proportion to their percentage interests in Industries
immediately before the effective date of this Plan, and will receive percentage
interests in Captiva based upon the respective values of their deemed
contributions, all in accordance with the terms and conditions of the Captiva
Agreement.
3. Each partner, general and limited, of Industries will receive
a limited partnership interest in Captiva in the manner set forth in paragraph
2, above. Other than limited partnership interests, no cash, property or other
asset shall be distributed to any partner of any party to this Plan.
4. The Certificate of Limited Partnership of Captiva, as the
surviving limited partnership is set forth and attached as Exhibit A to this
Plan.
5. To the extent that either the Industries Agreement or the
Captiva Agreement conflicts with any term or provision of this Plan, this Plan
shall be deemed an amendment to the applicable agreement, adopted by all of the
partners of the applicable limited partnership.
6. This Plan is adopted in accordance with Section 2.11 of the
Act. The merger shall be effective upon the filing of this Certificate and Plan
of Merger.
This Plan has been adopted by all partners of Industries and Captiva,
effective as of the date first above written.
CAPTIVA, LTD.
BY: KLEE & COMPANY, L.L.C.,
General Partner
By:
------------------------------------
Helene Gralnick, Manager
GRALNICK INDUSTRIES LIMITED PARTNERSHIP
By:
-----------------------------------------
Helene Gralnick, Trustee of the
Helene Gralnick Trust
2
<PAGE> 3
LIMITED PARTNER JOINDER:
--------------------------------------------
Helene Gralnick
--------------------------------------------
Helene Gralnick, Trustee of the
Helene Gralnick Trust
3
<PAGE> 1
EXHIBIT 2
CERTIFICATE AND PLAN OF MERGER OF
GRALNICK ENTERPRISES LIMITED PARTNERSHIP
(a Nevada limited partnership)
with and into
SARTRE PARTNERS, LTD.
(a Texas limited partnership)
This Plan of Merger ("Plan") is entered into effective this the 8th day
of February, 1995, by and between Gralnick Enterprises Limited Partnership, a
Nevada limited partnership, ("Enterprises") and Sartre Partners, Ltd., a Texas
limited partnership, ("Sartre"), and is as follows:
WITNESSETH
WHEREAS, Enterprises was formed as a Nevada limited partnership under
and pursuant to that certain Limited Partnership Agreement dated December 23,
1993 ("Enterprises Agreement"); and
WHEREAS, Sartre was formed as a Texas limited partnership under and
pursuant to that certain Limited Partnership Agreement dated February 8, 1995
("Sartre Agreement"); and
WHEREAS, acting pursuant to Section 2.11 of the Texas Revised Limited
Partnership Act (the "Act"), all partners, general and limited, of Enterprises
and Sartre have approved and consented to the Plan set forth below under which
Enterprises will be merged with and into Sartre, and Sartre will be the
surviving limited partnership:
NOW, THEREFORE, it is agreed as follows:
1. The name and domicile of each party to this Plan are as
follows:
Gralnick Enterprises Limited Partnership
Nevada
Sartre Partners, Ltd.
Texas
The name and domicile of the limited partnership which will survive the merger
are:
Sartre Partners, Ltd.
Texas
2. The terms and conditions of the Plan are as follows:
<PAGE> 2
The values of the respective properties and assets of Enterprises and Sartre
have been determined and agreed upon by all partners, general and limited, of
each partnership. All partners of Enterprises, general and limited, shall become
limited partners in Sartre. The partners of Enterprises will be deemed to have
contributed property to Sartre, in proportion to their percentage interests in
Enterprises immediately before the effective date of this Plan, and will receive
percentage interests in Sartre based upon the respective values of their deemed
contributions, all in accordance with the terms and conditions of the Sartre
Agreement.
3. Each partner, general and limited, of Enterprises will receive
a limited partnership interest in Sartre in the manner set forth in paragraph 2,
above. Other than limited partnership interests, no cash, property or other
asset shall be distributed to any partner of any party to this Plan.
4. The Certificate of Limited Partnership of Sartre, as the
surviving limited partnership is set forth and attached as Exhibit A to this
Plan.
5. To the extent that either the Enterprises Agreement or the
Sartre Agreement conflicts with any term or provision of this Plan, this Plan
shall be deemed an amendment to the applicable agreement, adopted by all of the
partners of the applicable limited partnership.
6. This Plan is adopted in accordance with Section 2.11 of the
Act. The merger shall be effective upon the filing of this Certificate and Plan
of Merger.
This Plan has been adopted by all partners of Enterprises and Sartre,
effective as of the date first above written.
SARTRE PARTNERS, LTD.
BY: CAMUS & COMPANY, L.L.C.,
General Partner
By:
------------------------------------
Marvin Gralnick, Manager
GRALNICK ENTERPRISES LIMITED PARTNERSHIP
By:
-----------------------------------------
Marvin Gralnick, Trustee of the
Marvin Gralnick Trust
2
<PAGE> 3
LIMITED PARTNER JOINDER:
--------------------------------------------
Marvin Gralnick
--------------------------------------------
Marvin Gralnick, Trustee of the
Marvin Gralnick Trust
3
<PAGE> 1
EXHIBIT 3
LIMITED PARTNERSHIP AGREEMENT
OF
RODIN, LTD.
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE 1
FORMATION, NAME, PRINCIPAL PLACE OF BUSINESS,
REGISTERED OFFICE AND REGISTERED AGENT.................................... 1
1.1 Formation..................................................................................... 1
1.2 Name.......................................................................................... 1
1.3 Principal Place of Business................................................................... 1
1.4 Registered Office and Agent................................................................... 1
ARTICLE 2
DEFINITIONS................................................. 2
2.1 Definitions................................................................................... 2
ARTICLE 3
PURPOSE AND SCOPE OF THE PARTNERSHIP..................................... 6
3.1 Purpose and Scope of the Partnership.......................................................... 6
3.2 Statutory Requirements........................................................................ 7
3.3 Competing Business............................................................................ 7
ARTICLE 4
TERM..................................................... 7
4.1 Term of the Partnership....................................................................... 7
ARTICLE 5
CAPITAL CONTRIBUTIONS AND ADVANCES...................................... 7
5.1 The General Partner........................................................................... 7
5.2 The Limited Partners.......................................................................... 8
5.3 Classification of Partners.................................................................... 8
5.4 Units......................................................................................... 8
5.5 Loans by Partners............................................................................. 9
5.6 Interest on and Return of Capital Contributions............................................... 9
ARTICLE 6
ALLOCATION OF PROFIT AND LOSS........................................ 9
6.1 Loss Allocations.............................................................................. 9
6.2 Profit Allocations............................................................................ 10
6.3 Varying Interests of the Partners............................................................. 10
</TABLE>
i
<PAGE> 3
<TABLE>
<S> <C> <C>
ARTICLE 7
DISTRIBUTIONS................................................ 10
7.1 Distribution of Net Cash Flow................................................................. 10
7.2 Distribution of Net Cash From Sales or Refinancings........................................... 10
7.3 Discretion of General Partner................................................................. 11
ARTICLE 8
ACCOUNTING AND TAX MATTERS.......................................... 11
8.1 Taxable Year.................................................................................. 11
8.2 Books and Records............................................................................. 11
8.3 Reports....................................................................................... 11
8.4 Bank Accounts................................................................................. 11
8.5 Tax Returns................................................................................... 11
8.6 Accounting Decisions.......................................................................... 11
8.7 Basis Election................................................................................ 11
8.8 Capital Accounts.............................................................................. 12
8.9 Tax Matters Partner........................................................................... 12
ARTICLE 9
THE LIMITED PARTNERS............................................. 12
9.1 Business of the Partnership................................................................... 12
9.2 No Liability.................................................................................. 13
9.3 Status of Partnership Interest................................................................ 13
ARTICLE 10
THE GENERAL PARTNER............................................. 13
10.1 Status of Partnership Interest................................................................ 13
10.2 Rights and Powers of the General Partner...................................................... 13
10.3 Limitations on Authority of the General Partner............................................... 15
10.4 Payments to the General Partner and Its Affiliates............................................ 15
ARTICLE 11
TRANSFER RESTRICTIONS............................................ 16
11.1 Assignment.................................................................................... 16
11.2 General Limitations on Assignment............................................................. 16
11.3 Right of First Refusal........................................................................ 17
11.4 Certain Assignment Events Involving Limited Partners and Assignees............................ 19
11.5 Certain Assignment Events Involving General Partner(s)........................................ 20
11.6 Substituted Limited Partner................................................................... 21
</TABLE>
ii
<PAGE> 4
<TABLE>
<S> <C> <C>
ARTICLE 12
DISSOLUTION AND TERMINATION......................................... 21
12.1 Dissolution................................................................................... 21
12.2 Continuation of Business and Reconstitution of Partnership.................................... 22
12.3 Winding-Up and Termination.................................................................... 22
ARTICLE 13
POWER OF ATTORNEY.............................................. 24
13.1 Appointment of Power of Attorney.............................................................. 24
ARTICLE 14
AMENDMENT.................................................. 25
14.1 Procedure for Amendment....................................................................... 25
ARTICLE 15
MISCELLANEOUS PROVISIONS........................................... 25
15.1 Meetings...................................................................................... 25
15.2 Governing Law................................................................................. 26
15.3 Title......................................................................................... 26
15.4 Consents and Approvals........................................................................ 26
15.5 Notices....................................................................................... 26
15.6 Controlling Provision......................................................................... 26
15.7 Execution in Counterparts..................................................................... 26
15.8 Reliance on Opinion of Counsel................................................................ 26
15.9 Scope of Partners' Authority.................................................................. 26
15.10 Execution of Partnership Documents............................................................ 26
15.11 Waiver of Partition........................................................................... 27
15.12 Time.......................................................................................... 27
15.13 Binding Effect................................................................................ 27
15.14 Entire Agreement.............................................................................. 27
15.15 Remedies Not Exclusive........................................................................ 27
15.16 Severability.................................................................................. 27
15.17 Captions...................................................................................... 27
15.18 Identification................................................................................ 27
15.19 Certain Representations....................................................................... 27
15.20 Limited Liability and Indemnification of the General Partner.................................. 28
15.21 Further Assurances............................................................................ 28
15.22 Spousal Consent............................................................................... 28
</TABLE>
iii
<PAGE> 5
LIMITED PARTNERSHIP AGREEMENT
OF
RODIN, LTD.
THIS AGREEMENT, made and entered into on this the ______ day of
December, 1995, by and among Klee & Company, L.L.C., a Texas limited liability
company, as the general partner ("General Partner") and the party or parties
identified in Exhibit A attached hereto as the limited partner(s). The limited
partners are referred to, collectively, as the "Limited Partners" and
individually a "Limited Partner." The General Partner and the Limited Partners
are hereinafter sometimes referred to collectively as the "Partners" and
individually as a "Partner."
W I T N E S S E T H:
WHEREAS, the parties desire to form a limited partnership, governed by
the Texas Revised Limited Partnership Act, Article 6132a-1, Vernon's Texas Civil
Statutes, as amended, (the "Act") and all other pertinent laws of the State of
Texas;
NOW, THEREFORE, in consideration of these premises and the mutual
covenants of the parties, and for other good and valuable consideration, the
receipt and sufficiency of all of which are hereby acknowledged, the parties
hereby agree as follows:
ARTICLE 1
FORMATION, NAME, PRINCIPAL PLACE OF BUSINESS,
REGISTERED OFFICE AND REGISTERED AGENT
1.1 Formation. The parties hereby form a Texas limited partnership
under the Act, upon the terms and conditions herein set forth.
1.2 Name. The name of the partnership shall be Rodin, Ltd. (the
"Partnership").
1.3 Principal Place of Business. The principal place of business
of the Partnership shall be 301 Congress Avenue, Suite 1900, Austin, Texas
78701, or such other address as the General Partner may determine.
1.4 Registered Office and Agent. The initial registered office of
the Partnership shall be 301 Congress Avenue, Suite 1900, Austin, Texas 78701.
The initial registered agent of the Partnership shall be Duncan E. Osborne. The
General Partner shall have the authority to change the registered office or
registered agent of the Partnership from time to time by complying with Section
1.06 of the Act.
<PAGE> 6
ARTICLE 2
DEFINITIONS
2.1 Definitions.
(A) In addition to the terms defined elsewhere in this
Agreement and exhibits, the following terms shall have the respective meanings
set forth below for purposes of this Agreement:
(1) "Adjusted Capital Contribution" means, for
each Partner, the excess, if any, of (a) the aggregate capital
contributions made by such Partner pursuant to Article 5 over (b) the
aggregate distributions made to such Partner pursuant to Article 7.
(2) "Affiliate" means with respect to any
Person: (i) any other Person which directly or indirectly controls, is
controlled by or is under common control with the first Person; (ii)
any officer, director or employee of such Person; or (iii) in the case
of an individual, the members of such Person's family, including
spouse, parents, siblings, lineal descendants, grandparents and other
relations no more remote than first cousin. The term "control" shall
mean the ownership of 50% or more of the beneficial interest in any
Person, the ability to direct any other Person's business and affairs
or serving as a general partner of any Person.
(3) "Bankruptcy" means, with respect to any
Person, (A) the making by such Person of a general assignment for the
benefit of creditors; (B) the filing by such Person of a voluntary
bankruptcy petition; (C) such Person becoming the subject of an order
for relief or being declared insolvent in any federal or state
bankruptcy or insolvency proceedings; (D) the filing by such Person of
a petition or answer seeking for such Person a reorganization,
arrangement, composition, readjustment, liquidation, dissolution, or
similar relief under any law; (E) the filing by such Person of an
answer or other pleading admitting or failing to contest the material
allegations of a petition filed against such Person in a proceeding of
the type described in parts (A) through (D) of this definition; (F)
such Person seeking, consenting to or acquiescing in the appointment of
a trustee, receiver of liquidator of such Person or of all or any
substantial part of such Person's properties; or (G) the expiration of
120 days after the date of the commencement of a proceeding against
such Person seeking reorganization, arrangement, composition,
readjustment, liquidation or dissolution or similar relief under any
law if the proceeding has not been previously dismissed, or the
expiration of 90 days after the date of the appointment, without such
Person's consent or acquiescence, of a trustee, receiver, or liquidator
of such Person of all or any substantial part of such Person's
properties if the appointment has not been previously vacated or
stayed, or the expiration of 90 days after the date of expiration of a
stay, if the appointment has not previously been vacated.
(4) "Code" means the Internal Revenue Code of
1986, as amended, and references to any section of the Code include any
successor provision or provisions thereto.
(5) "Depreciation" means, for each fiscal year
or other period, an amount equal to the depreciation, amortization, or
other cost recovery deduction allowable with respect to an asset for
such year or other period, except that if the Asset Value of an asset
differs from its adjusted basis for federal income tax purposes at the
beginning of such year or other period,
2
<PAGE> 7
Depreciation shall be an amount which bears the same ratio to such
beginning Asset Value as the federal income tax depreciation,
amortization, or other cost recovery deduction for such year or other
period bears to such beginning adjusted tax basis; provided, however,
that if the federal income tax depreciation, amortization, or other
cost recovery deduction for such year is zero, Depreciation shall be
determined with reference to such beginning Asset Value using any
reasonable method selected by the General Partner.
(6) "Asset Value" means, with respect to any
asset, the asset's adjusted basis for federal income tax purposes,
except as follows:
(a) The initial Asset Value of any
asset contributed by a Partner to the Partnership shall be the
gross fair market value of such asset on the date of
contribution, as determined by the contributing Partner and
the Partnership;
(b) The Asset Values of all Partnership
assets shall be adjusted to equal their respective gross fair
market values (and the Capital Accounts of the Partners shall
be adjusted as is appropriate), as determined by the General
Partner as of each of the following times: (i) the issuance of
additional Units to any new or existing Partner in exchange
for a capital contribution; (ii) the distribution by the
Partnership to a Partner of property as consideration for
Units; and (iii) the liquidation of the Partnership within the
meaning of Regulations ss. 1.704-1(b)(2)(ii)(g); provided,
however, that adjustments pursuant to clauses (i) and (ii)
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 Partners in
the Partnership; and
(c) The Asset Value of any Partnership
asset distributed to any Partner shall be the gross fair
market value of such asset on the date of distribution as
determined by the General Partner.
If the Asset Value of an asset has
been determined or adjusted pursuant to Section 2.1(A)(6)(a) or Section
2.1(A)(6)(b), such Asset Value shall thereafter be adjusted by the
Depreciation taken into account with respect to such asset for purposes
of computing Profits and Losses.
(7) "Majority in Interest of the
Limited Partners" means Limited Partners who hold Units which exceed
50% of the total number of outstanding Units in the Partnership held by
Limited Partners.
(8) "Majority in Interest of the
Partners" means Partners who hold Units which exceed 50% of the
Partnership's total outstanding Units.
(9) "Net Asset Value" when applied to
all Partnership assets, means as of a specified date, the excess of the
fair market value of the assets of the Partnership on such date over
its liabilities on such date, all as determined by the General Partner
and a Majority in Interest of the Limited Partners; and when applied to
a specific asset, means as of a specified date, the excess of the fair
market value of such asset on such dates over any liability encumbering
such
3
<PAGE> 8
asset, as determined by the General Partner and (i) the contributing
Partner (on asset contributions), (ii) the distributive Partner (on
asset distributions), or (iii) a Majority in Interest of the Limited
Partners (in any other event).
(10) "Net Cash Flow" means (on the cash
receipts and disbursements method of accounting) the net receipts (the
excess, if any, of revenues less expenses and repayment of loans) of
the Partnership, including distributions from entities owned by the
Partnership and cash from operations or investments, but excluding (a)
Net Cash From Sales or Refinancings, (b) capital contributions of the
Partners, (c) proceeds of any loans made to the Partnership, (d) funds
which the General Partner, in his sole discretion, elects to reinvest
on behalf of the Partnership and (e) reserves deemed reasonably
sufficient, in the sole discretion of the General Partner, for (i) the
working capital needs of the Partnership, (ii) the payment of
liabilities incurred (including any loans made by any Partners) or
arising in the reasonably foreseeable future in connection with the
operations of the Partnership and (iii) capital expenditures or
contributions incurred or arising in the reasonably foreseeable future
in connection with the operations of the Partnership.
(11) "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 any Partnership asset, 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 any Partnership asset.
(12) "Percentage Interest" of each
Partner means the percentage of the Partnership's total outstanding
Units owned by such Partner.
(13) "Person" means an individual, a
corporation, a firm, a partnership, a joint venture, a trust, an
unincorporated organization, an association, a joint-stock company, a
government or any department or agency thereof, or any other form of
entity.
(14) "Proceeds," when used in connection
with a sale, exchange or other disposition of property or with a
refinancing, means net proceeds after the deduction of all related
expenses.
(15) "Profits" and "Losses" means, for
each fiscal year or other period, an amount equal to the Partnership's
taxable income or loss for such year or period, determined in
accordance with ss. 703(a) of the Code (for this purpose, all items of
income, gain, loss or deduction required to be stated separately
pursuant to ss. 703(a)(1) of the Code shall be included in taxable
income or loss), with the following adjustments:
(a) 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
definition shall be added to such taxable income or loss;
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(b) Any expenditures of the Partnership
described in ss. 705(a)(2) (B) of the Code or treated as Code
ss. 705(a)(2)(B) expenditures pursuant to Regulations ss.
1.704-1(b)(2)(iv)(i), and not otherwise taken into account in
computing Profits or Losses pursuant to this definition shall
be subtracted from such taxable income or loss;
(c) In the event the Asset Value of any
Partnership asset is adjusted, 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;
(d) Gain or loss resulting from any
disposition of a Partnership asset with respect to which gain
or loss is recognized for federal income tax purposes shall be
computed by reference to the Asset Value of such asset
disposed of, notwithstanding that the adjusted tax basis of
such asset differs from its Asset Value;
(e) In lieu of 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 or
other period; and
(f) Any items which are specially
allocated pursuant to Exhibit C to this Agreement shall not be
taken into account in computing Profits and Losses.
(16) "Regulations" means all references herein to
specific temporary or final Treasury Regulations promulgated in respect
of the Code and any successor provision or provisions thereto.
(B) The following indicates the location in this
Agreement of the definitions of the following terms:
<TABLE>
<CAPTION>
Defined Term Section
------------ -------
<S> <C>
Act Page 1
Adjusted Capital Contribution 2.1(A)(1)
Adjusted Capital Account Deficit Exh. C, C-(1)
Affiliate 2.1(A)(2)
Asset Value 2.1(A)(6)
Assign 11.1(A)
Bankruptcy 2.1(A)(3)
Capital Account 8.8
Code 2.1(A)(4)
Depreciation 2.1(A)(5)
Dissolving Events 12.1
Effective date of an assignment 11.1(B)
General Partner Page 1
Limited Partners Page 1
Liquidation Proceeds 12.3(B)
Majority in Interest of the
Limited Partners 2.1(A)(7)
</TABLE>
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<PAGE> 10
<TABLE>
<S> <C>
Majority in Interest of the Partners 2.1(A)(8)
Nonrecourse Liability Exh. C, C-(4)(a)(1)
Net Asset Value 2.1(A)(9)
Net Cash Flow 2.1(A)(10)
Net Cash From Sales or Refinancings 2.1(A)(11)
Notifying Party 11.3(A)
Offer Notice 11.3(A)
Option Partners 11.3(A)
Partner Funded Debt Exh. C, C-(4)(b)(1)
Partner Funded Deductions Exh. C, C-(4)(b)(2)
Partner Minimum Gain Exh. C, C-(4)(b)(3)
Partners Page 1
Partnership 1.2
Partnership Minimum Gain Exh. C, C-(4)(a)(2)
Percentage Interest 2.1(A)(12)
Person 2.1(A)(13)
Pre-Contribution Gain Exh. C, C-(2)
Pre-Contribution Loss Exh. C, C-(3)
Proceeds 2.1(A)(14)
Profits and Losses 2.1(A)(15)
Purchaser Exh. B, B.
Regulations 2.1(A)(16)
Seller Exh. B, B.
Tax Matters Partner 8.9
Transferred Interests 11.1(A)
Units 5.4
</TABLE>
ARTICLE 3
PURPOSE AND SCOPE OF THE PARTNERSHIP
3.1 Purpose and Scope of the Partnership. The purposes of the
Partnership shall be to:
(A) Acquire, own and hold for investment real estate
(including mineral interests), securities, or any other property as the General
Partner may determine;
(B) Engage in any business, directly or indirectly as a
partner, shareholder or joint venturer, as the General Partner may determine to
be in the best interests of the Partnership, including, without limitation, the
real estate business, the mineral business and investments;
(C) Transact any business that may be conducted in
partnership form; and
(D) Consolidate, preserve, enhance and manage such of the
businesses and properties of the Marvin and Helene Gralnick family contributed
to the Partnership in order to promote economies of scale, provide for
management transition within a family, protect against unwanted transfers of
Units outside the family and to facilitate the charitable goals of the family.
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The Partnership may pursue these activities through the
direct ownership of property, indirectly through the ownership of interests in
joint ventures, partnerships, corporations or other entities or revocable trusts
which own property, or in any other manner the General Partner deems
appropriate. The Partnership, acting by and through the General Partner, shall
have all powers necessary or desirable to achieve the Partnership purposes,
including, but not limited to, the power to enter into agreements, leases,
mortgages, evidences of indebtedness, and construction, development, management,
partnership and joint venture agreements, and other contracts and amendments
thereto; the power to borrow money; the power to open and maintain bank accounts
authorizing withdrawals on the signature of such one or more Persons as the
General Partner may designate; the power to sell, pledge, encumber, assign and
otherwise deal with or dispose of any or all of the property of the Partnership;
the power to execute such other documents and to take such other actions as may
be necessary or desirable from time to time in connection with any of the
foregoing; and such other powers granted the General Partner in Article 10.
3.2 Statutory Requirements. The General Partner shall cause a
Certificate of Limited Partnership to be executed and filed with the Secretary
of State of the State of Texas. The General Partner shall cause to be executed
and filed from time to time certificates of amendment or termination to such
certificate whenever the same may be required by the Act. The General Partner is
further authorized and empowered by the Limited Partners to prepare and file
with the Secretary of State of the State of Texas and with other appropriate
authorities any assumed name certificates, applications for certificates of
authority or other filings required to be made by the Partnership to comply with
any applicable law.
3.3 Competing Business. No General Partner shall be obligated to
devote such General Partner's full time and attention to the Partnership and its
affairs. Nothing contained in this Agreement shall restrict the right of any
Partner to conduct, independently of the Partnership, any business, investment
or other activity, whether or not similar to or competitive with the business of
the Partnership. In the event that a Partner engages in any such other business
or other activity, such partner shall not be accountable to the Partnership or
to any other Partner in any manner in connection therewith. No Partner shall be
required to submit any other investment opportunities to the Partnership.
ARTICLE 4
TERM
4.1 Term of the Partnership. The term of the Partnership shall
commence as of the date first above written and shall continue, unless
terminated earlier in accordance with this Agreement, until December 31, 2035.
ARTICLE 5
CAPITAL CONTRIBUTIONS AND ADVANCES
5.1 The General Partner.
(A) The General Partner shall contribute to the
Partnership the property described in Exhibit A to this Agreement, the Net Asset
Value of which property is also set forth in Exhibit A.
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(B) The General Partner shall receive Units which
represent a one percent (1%) Percentage Interest. All remaining Units
attributable to property contributions by the General Partner shall be issued as
limited partnership Units.
(C) Each General Partner shall at all times hold Units
which represent no less than a one percent (1%) Percentage Interest. Each
General Partner agrees to contribute capital, from time to time, in the form of
cash or other property, in exchange for Units sufficient to at all times
maintain no less than a one percent (1%) Percentage Interest.
(D) Except as provided in this section and Section
5.1(C), the General Partner is not obligated to make any additional capital
contributions to the Partnership, but any General Partner may do so if such
General Partner so elects. If on the final dissolution and winding up of the
Partnership and following the allocation of all taxable income, gain, loss and
deductions resulting therefrom and the distribution of all cash and other
property, the Capital Account of a General Partner has a negative balance, such
General Partner shall contribute to the Partnership capital, an amount equal to
the negative balance in its Capital Account, and shall do so in compliance with
Regulation ss. 1.704-1(b)(2)(ii)(b)(3). Except as otherwise provided in this
Section 5.1(D), under no conditions shall any General Partner be required, upon
dissolution and winding up of the Partnership or at any other time, to
contribute capital to the Partnership solely on account of the loss of some or
all of the capital contributed by any other Partner or on account of a negative
balance in the Capital Account of any other Partner.
5.2 The Limited Partners. The Limited Partners have contributed
the property described in Exhibit A, the Net Asset Value of which property is
also set forth on Exhibit A. Each Limited Partner shall receive the number of
Units and be entitled to the Percentage Interest set forth on Exhibit A. No
Limited Partner shall be obligated to make any additional capital contributions
and shall not be obligated to restore or eliminate any negative balance in such
Limited Partner's Capital Account.
5.3 Classification of Partners. A Partner's interest in the
Partnership is determined pursuant to this Agreement according to whether the
Partner acquires Units as a General Partner or a Limited Partner. A Partner may
hold Units as both a General Partner and a Limited Partner and, with respect to
the Units held as a Limited Partner, shall be entitled to all the rights and
privileges as a Limited Partner.
5.4 Units.
(A) In exchange for each $1,000 (or fractional part of
$1,000) of Net Asset Value of property contributed by each Partner as reflected
on Exhibit A, each Partner will receive one or more units, or fractional units
(collectively, "Units"), representing such Partner's interest in the
Partnership.
(B) In the event any Partner elects to make additional
capital contributions to the Partnership with the consent of the General Partner
or in the event the Partnership admits additional partners, the number of Units
to be received in exchange for such an additional capital contribution shall be
determined as follows:
(1) The Net Asset Value of all Partnership
assets shall be determined on the date immediately prior to such
contribution.
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<PAGE> 13
(2) The Net Asset Value of all Partnership
assets shall be divided by the number of Units outstanding immediately
before the contribution ("Unit Value"); and
(3) In exchange for such additional capital
contribution, the Partner or Person making such contribution shall
receive that number of Units which equals the Net Asset Value of the
property contributed divided by the Unit Value.
5.5 Loans by Partners. To the extent that any funds in excess of
those provided for under Sections 5.1 and 5.2 are needed by the Partnership, as
determined by the General Partner, the General Partner may request one or more
loans from the Partners. Any Partner may, but need not, advance such additional
funds as a loan to the Partnership at an interest rate equal to one percentage
point over the commercial base rate being charged by NationsBank N.A.-Austin,
Texas, and shall, unless otherwise agreed by the Partnership and such Partner,
be repaid as a priority out of the next available funds. If more than one loan
is made pursuant to this Section 5.5, the earlier in time shall be repaid first.
If more than one Partner desires to make loans, such Partners shall provide
loans in such proportions as they may agree and, in lieu of agreement, in the
proportions of their respective Units.
5.6 Interest on and Return of Capital Contributions. No Partner
shall receive any interest on its capital contributions to the Partnership or on
its Capital Account notwithstanding any disproportionate contributions or
Capital Accounts as between the Partners. The General Partner shall not be
liable for the return of the capital contributions of the Limited Partners, nor
for the return of any Partnership assets. A negative balance in any Partner's
Capital Account shall not be deemed to be an asset of the Partnership, except
pursuant to Section 5.1(D). No Partner shall be entitled to withdraw or obtain a
return of all or any part of its capital contribution otherwise than as
expressly provided in this Agreement. It is the intent of the Partners that,
unless expressly stated otherwise in a writing furnished to all the Partners by
the Partnership, no distribution (or any part of any distribution) made to any
Partner pursuant to this Agreement shall be deemed a return or withdrawal of
capital, even if such distribution represents (in full or in part) a
distribution of depreciation or any other noncash item accounted for as a loss
or deduction from or offset to income. It is the further intent of the Partners
that no Partner shall be obligated to pay any such amount to or for the account
of the Partnership or any creditor of the Partnership. However, if any court of
competent jurisdiction holds that the Partnership made a distribution to a
Limited Partner in violation of Section 6.07(a) of the Act and the Limited
Partner knew that such a distribution was prohibited, then any obligation to
return the distribution to the Partnership pursuant to Section 6.07(b) of the
Act shall be the obligation of such Partner and not of any other Partner or the
Partnership.
ARTICLE 6
ALLOCATION OF PROFIT AND LOSS
6.1 Loss Allocations.
(A) After first giving effect to the special allocations
set forth in Exhibit C to this Agreement (if applicable), and subject to the
limitation in Section 6.1(B), Losses for any fiscal year shall be allocated as
follows:
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<PAGE> 14
(1) First, to the Partners who have positive
balances in their Capital Accounts pro rata in accordance with and up
to the amount of such positive balances;
(2) Second, any remaining Losses shall be
allocated to the General Partner.
(B) Losses allocated to a Partner pursuant to Section
6.1(A) and this Section 6.1(B) shall not exceed the maximum amount of Losses
that can be so allocated without causing such Partner to have an Adjusted
Capital Account Deficit at the end of any fiscal year. All Losses in excess of
the limitation set forth in this Section 6.1(B) shall be allocated to the other
Partners in proportion to their Percentage Interests.
6.2 Profit Allocations. After first giving effect to the special
allocations set forth in Exhibit C to this Agreement (if applicable), Profits
for any fiscal year shall be allocated as follows:
(A) First, to the General Partner until the cumulative
Profits allocated pursuant to this Section 6.2(A) equal the cumulative Losses
allocated to the General Partner pursuant to Section 6.1(A)(2);
(B) Second, to the Partners until the cumulative Profits
allocated pursuant to this Section 6.2(B) equal the cumulative Losses allocated
to the Partners pursuant to Section 6.1(A)(1); and
(C) Third, any remaining Profits shall be allocated to
the Partners in their Percentage Interests.
6.3 Varying Interests of the Partners. In the event that the
Partners' Percentage Interests vary during a taxable year due to the issuance of
additional Units or because of a transfer of Units, then the Profits and Losses
shall be allocated among the Partners whose Percentage Interests changed during
the taxable year based upon the length of time during such year that each
Partner held a particular Percentage Interest and as if the items were incurred
or received, as the case may be, ratably throughout the entire taxable year;
provided, however, that if the assets of the Partnership are sold, exchanged or
otherwise disposed of after a change in Percentage Interests, but during the
taxable year in which the change occurs, all taxable income or loss attributable
to such sale, exchange or other disposition shall be allocated in accordance
with the Percentage Interests on the date of the sale, exchange or other
disposition.
ARTICLE 7
DISTRIBUTIONS
7.1 Distribution of Net Cash Flow. At such times as the General
Partner may determine, the Partnership shall make distributions of Net Cash Flow
to the Partners in proportion to their Percentage Interests.
7.2 Distribution of Net Cash From Sales or Refinancings. Except as
otherwise provided in Section 12.3(C), Net Cash From Sales or Refinancings shall
be distributed, at such times as the General Partner may determine, as follows:
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(A) First, to the Limited Partners until their Adjusted
Capital Contributions are reduced to zero;
(B) Second, to the General Partner until his Adjusted
Capital Contributions are reduced to zero; and
(C) The balance, if any, to the Partners in proportion to
their Percentage Interests.
7.3 Discretion of General Partner. All distributions pursuant to
Sections 7.1 or 7.2 shall be made at such time or times determined in the sole
discretion of the General Partner. The General Partner shall not be obligated to
declare a distribution and shall exercise his discretion in the best interest of
the Partnership in accordance with his duty of care and loyalty to the
Partnership. In making distributions the General Partner may consider the future
credit needs of the Partnership, future business needs for reserves and
expansions, prepayment of credit lines and operating reserves for the
Partnership. Proceeds from the sale or refinancing of property shall be
considered necessary reserves for replacement or investment, unless otherwise
determined by the General Partner.
ARTICLE 8
ACCOUNTING AND TAX MATTERS
8.1 Taxable Year. The taxable year of the Partnership shall be the
calendar year.
8.2 Books and Records. The General Partner shall keep or cause to
be kept adequate books of account of the Partnership on the cash or accrual
basis, as the General Partner elects, wherein shall be recorded all of the
contributions to the capital of the Partnership, all income, all distributions
and all expenses and transactions of the Partnership. The General Partner shall
also maintain as a part of the books and records of the Partnership all records
and information required by Section 1.07 of the Act. The income tax returns of
the Partnership shall be prepared and filed on the basis of the accounting
methods as selected by the General Partner.
8.3 Reports. On or before March 15 of each year, the General
Partner will furnish each Limited Partner, at the expense of the Partnership,
with a report containing information with respect to the Partnership to be used
in preparing such Limited Partners' State and Federal income tax returns.
8.4 Bank Accounts. All funds of the Partnership not otherwise
invested shall be deposited in such accounts as the General Partner shall
designate. Withdrawals therefrom shall be made upon such signatures as the
General Partner may designate.
8.5 Tax Returns. The General Partner shall cause income tax
returns for the Partnership to be prepared and filed with the appropriate
authorities within the time periods required by law.
8.6 Accounting Decisions. All decisions as to accounting
principles, except as specifically provided to the contrary herein, shall be
made by the General Partner.
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8.7 Basis Election. Upon the transfer of an interest in the
Partnership, a distribution of its property, or the death of a Partner, the
General Partner shall have the right, but not the obligation, to cause the
Partnership to elect to adjust the basis of the Partnership property as allowed
by ss.ss. 734(b), 743(b) and 754 of the Code, provided, however, that if such an
election is made, the Partnership shall not be required to make (and shall not
be obligated to bear the expenses of making) any accounting adjustments
resulting from such election in the information supplied to the Partners, or if
it provides such adjustments the Partnership shall have the right to charge the
Partner or Partners benefitting from such election for the Partnership's
reasonable expenses in making such adjustments.
8.8 Capital Accounts. The General Partner shall maintain a
separate Capital Account for each Partner regardless of the class or classes of
Units owned by such Partner. "Capital Account" shall mean, with respect to any
Partner, the amount of cash and the Asset Value of property contributed by the
partner to the Partnership (net of liabilities assumed by the Partnership and
liabilities to which such contributed property is subject) (1) reduced, to the
extent required under ss. 704(b) of the Code, by (a) any Loss allocated to such
Partner under Section 6.1 and any items of deduction and loss which are
specially allocated pursuant to Exhibit C to this Agreement and (b) any
distributions of Net Cash Flow and Net Cash From Sales or Refinancings to such
Partner under Section 7.1 and Section 7.2, respectively, and the Asset Value of
property distributed to the Partner by the Partnership (net of liabilities
assumed by the Partner and liabilities to which such distributed properties are
subject), and (2) increased, to the extent required under ss. 704(b) of the
Code, by any Profit allocated to such Partner under Section 6.2 of this
Agreement and any items of income and gain which are specially allocated
pursuant to Exhibit C to this Agreement. For purposes of maintaining the
Partners' Capital Accounts, all distributions shall be deemed to have been made
in the year of the actual distribution without regard to the time period in
which the transaction or transactions giving rise to the funds occurred. The
Capital Account with respect to any substituted Partner shall reflect all prior
adjustments to the Capital Account of the transferring Partner. Notwithstanding
any other provision of this Agreement, the Capital Accounts shall be maintained
in strict accordance with the Regulations promulgated under ss. 704(b) of the
Code. In this regard, the General Partner also shall make any appropriate
modifications to the Capital Account in the event that the General Partner
determines that the provisions contained in this Agreement do not otherwise
comply with Regulations ss. 1.704-1(b). In addition, the General Partner shall
maintain such other separate and additional accounts for each Partner as shall
be necessary to reflect accurately the rights and interests of the respective
Partners.
8.9 Tax Matters Partner.
The General Partner, or if there are multiple General
Partners, a General Partner appointed by a majority of the General Partners,
shall be the initial "Tax Matters Partner." Any successor Tax Matters Partner
shall be a General Partner.
ARTICLE 9
THE LIMITED PARTNERS
9.1 Business of the Partnership. The Limited Partners have the
rights and status of limited partners as provided in the Act. As such, the
Limited Partners may not participate in the control of the Partnership business,
or sign for or bind the Partnership, such power being vested exclusively in the
General Partner.
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9.2 No Liability. No Limited Partner shall have any personal
liability whatsoever, whether to the Partnership, the General Partner, or any
creditor of the Partnership, for the debts, liabilities, expenses or obligations
of the Partnership, or for any of its losses, beyond the amount of the capital
contributions made by such Limited Partner under this Agreement.
9.3 Status of Partnership Interest. The Units owned by the Limited
Partners shall be fully paid and nonassessable. The Limited Partners shall not
have the right to withdraw or reduce their contributions to the capital of the
Partnership except as a result of the dissolution of the Partnership or as
otherwise expressly provided herein and in accordance with law. The Limited
Partners shall not have the right to demand or receive property other than cash
in return for their contributions and shall have no priority over the General
Partner, either as to the return of contributions of capital or as to profits,
losses or distributions, except as provided herein.
ARTICLE 10
THE GENERAL PARTNER
10.1 Status of Partnership Interest. The Units owned by the General
Partner shall be fully paid and nonassessable, except to the extent provided in
Sections 5.1(C) and 5.1(D). The General Partner shall not have the right to
withdraw or reduce its contributions to the capital of the Partnership except as
a result of the dissolution of the Partnership or as otherwise expressly
provided herein and in accordance with law. No General Partner shall have a
right to demand or receive property other than cash in return for any
contributions it may make to the Partnership and shall have no priority over the
Limited Partners, either as to the return of contributions of capital or as to
profits, losses or distributions as a Partner, except as provided herein. All
decisions provided for herein to be made by the General Partner shall be within
the unlimited discretion of the General Partner.
10.2 Rights and Powers of the General Partner.
(A) In the event there is more than one General Partner,
actions of the General Partner in connection with the Partnership require the
unanimous consent of all of the General Partners. In the event of a disagreement
among the General Partners, the decision of Klee & Company, L.L.C., as long as
it is a General Partner, shall control in any and all events. Notwithstanding
the foregoing, any General Partner may delegate to the other General Partner any
or all rights, powers or duties hereunder, but not responsibilities, so long as
any such delegation shall be in a writing signed and dated by the delegating
General Partner. Any such delegation may be subject to such conditions or
restrictions as the delegating General Partner may determine. If at any time
there is only one General Partner, such remaining General Partner, acting alone,
shall be entitled to take all actions of the General Partner in connection with
the Partnership.
(B) The General Partner shall contribute its time, skill,
energy, advice and experience to the management of the Partnership's business;
shall (subject to Section 10.3) determine all matters relating to the financing,
management and operation of the assets and property of the Partnership; and
shall be the managing partner of the Partnership. The General Partner shall
devote such time to the affairs of the Partnership as it reasonably deems
necessary to properly conduct its business and affairs in accordance with this
Agreement and applicable law. The General Partner shall prosecute and defend
such
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actions at law or in equity as may be necessary to enforce or protect the
interests of the Partnership. Except as provided in Sections 10.2(C)(2) and
10.4, the services of the General Partner shall be rendered without cost to the
Partnership.
(C) In addition to any other rights and powers which it
may possess under law or by virtue of this Agreement, but subject to the other
provisions of this Agreement, the General Partner shall have full, exclusive and
complete discretion to manage and control, and to make all decisions affecting,
the Partnership business, with all the rights and powers of a partner in a
partnership without limited partners, or necessary or appropriate to manage the
Partnership business, including, but not limited to, the following rights and
powers:
(1) To cause any property owned or leased by the
Partnership to be held by the Partnership or on behalf of the
Partnership in the name of one of the Partners or of a nominee;
(2) To employ, engage or contract with Persons,
in the operation and management of the Partnership business, including,
but not limited to, appraisers, supervisory managing agents, building
management agents, insurance brokers, real estate brokers, loan
brokers, securities brokers, attorneys, and accountants, on such terms
and for such compensation as the General Partner shall determine;
provided, however, without the prior approval of a Majority in Interest
of the Limited Partners no Affiliate of a Partner may be so employed or
engaged under terms or conditions less favorable to the Partnership
than those customarily imposed by similarly qualified unrelated
Persons;
(3) To invest and reinvest all funds of the
Partnership;
(4) To acquire, hold, lease, encumber, pledge,
option, sell, exchange or otherwise deal with or dispose of real or
personal property (or rights or interests therein) of any nature
whatsoever as it may deem to be necessary or appropriate for the
operation of the business of the Partnership, it being agreed and
understood that the sale of any or all Partnership property is within
the ordinary business of the Partnership;
(5) To borrow money for Partnership purposes
and, if security is required, to mortgage, hypothecate, pledge or
otherwise give as security property of the Partnership;
(6) To acquire and enter into any contract of
insurance which the General Partner deems necessary or appropriate for
the protection of the Partnership, for the conservation of its assets
or for any purpose convenient or beneficial to the Partnership;
(7) To enter into agreements forming general
partnerships, limited partnerships, joint ventures, corporations or
limited liability companies and to participate as a partner,
shareholder or member on such terms and conditions as the General
Partner may determine;
(8) To guarantee financial transactions;
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(9) To establish one or more revocable trusts
solely for the benefit of the Partnership and to assign and convey
partnership property to such trust(s);
(10) To enter into agreements regarding any
mineral interests which the Partnership may own including mineral
leases, operating agreements, farm-ins, farm-outs, royalty agreements
and unitization or pooling agreements;
(11) To pay any and all fees and expenses
incurred in the organization or operation of the Partnership, or in any
modification of this Agreement; and
(12) To negotiate, execute, acknowledge, deliver,
file, publish or record any and all agreements or instruments to
effectuate any of the foregoing.
10.3 Limitations on Authority of the General Partner.
(A) Notwithstanding any contrary provisions of this
Agreement, and in addition to any other provisions of this Agreement which may
require approval by some or all of the Limited Partners, the General Partner
shall have no authority without the consent of all of the Limited Partners to:
(1) Do any act in contravention of this
Agreement;
(2) Confess a judgment against the Partnership;
or
(3) Admit a Person as a Limited Partner or as a
General Partner, except Substituted Limited Partners pursuant to
Section 11.6.
(B) The Limited Partners acting unanimously may, without
the concurrence of the General Partner, and with or without cause, vote to
remove one or more of the General Partners. In such event, such General Partner
shall no longer be a General Partner or have any power to exercise any rights or
powers of a General Partner, the general partnership interest of such removed
General Partner shall automatically be converted into a limited partnership
interest, and such removed General Partner shall automatically become a
Substituted Limited Partner. Further, and in addition to the rights of the
Limited Partners to appoint a new General Partner pursuant to Section 12.2, upon
the vote or concurrence of a Majority in Interest of the Limited Partners (other
than the then removed General Partner), a new General Partner may be admitted to
the Partnership and the Units of all the Limited Partners may be diluted pro
rata to provide Units for such new General Partner which represent no less than
a one percent (1%) Percentage Interest.
10.4 Payments to the General Partner and Its Affiliates. In
addition to the distributions to the General Partner provided for in Articles 7
and 12, the payments to Affiliates of the General Partner pursuant to Section
10.2(C)(2) and the repayment of principal and interest with respect to any loans
made by the General Partner in accordance with Section 5.5, the General Partner
is authorized to make the following payments to itself and its Affiliates:
(A) The Partnership will pay (or reimburse) the General
Partner and its Affiliates for all out-of-pocket expenses incurred by the
General Partner or its Affiliates in organizing the Partnership; and
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(B) The Partnership will pay (or reimburse) the General
Partner and its Affiliates for all out-of-pocket expenses incurred by the
General Partner or its Affiliates in carrying out their duties hereunder,
including (but not limited to) the cost of rents, utilities, supplies, wages,
employee benefits and any other third-party costs.
ARTICLE 11
TRANSFER RESTRICTIONS
11.1 Assignment.
(A) No Partner shall sell, give, transfer, will, assign,
pledge, encumber or otherwise dispose of, voluntarily or involuntarily,
(hereinafter "assign") all or any portion of or interest in such Partner's Units
("Transferred Interests") except as provided in this Article. In addition, no
assignee of Transferred Interests shall have the right to assign any Transferred
Interests except as permitted in this Article. In addition to meeting the other
requirements of this Article, any valid assignment must be in writing, the terms
of which are not in contravention of any of the provisions of this Agreement,
and the assignment must be received by the Partnership and recorded on the books
of the Partnership.
(B) As used in this Agreement, the "effective date of an
assignment" of Transferred Interests shall be the date as of which all of the
requirements for an assignment expressed in this Article shall have been met.
(C) Until the effective date of an assignment, both the
Partnership and the Partners shall be entitled to treat the assignor of such
Transferred Interests as the absolute owner thereof in all respects. However,
subject to Section 11.2, the General Partner may not refuse to record an
assignment on the books of the Partnership unless it reasonably believes the
assignment to be illegal, void or otherwise not in compliance with the terms of
this Agreement.
(D) Upon the effective date of an assignment of
Transferred Interests, the assignee of such Transferred Interests shall be
entitled to receive distributions from the Partnership in accordance with
Article 7 and Article 12 and to be allocated income, gain, loss, deduction,
credits or similar items in accordance with the other provisions of this
Agreement as if such assignee held Units instead of Transferred Interests.
However, no such assignee shall become a Partner (General or Limited) as a
result of such assignment or be entitled to any rights of a Partner under this
Agreement, including the right to vote on any Partnership matter or the right to
examine or have access to any Partnership records (except as provided in
Sections 1.07(d) and 1.07(e) of the Act), or to in any way interfere in the
management or operation of the Partnership, unless and until such assignee is
admitted as a Substituted Limited Partner pursuant to Section 11.6. Until
admitted as a Partner, (i) the assignor shall continue to be a Partner (General
or Limited Partner, as the case may be) and to have the power to exercise any
rights or powers of a Partner with respect to the Transferred Interests, and
(ii) the Units shall be deemed to remain outstanding and in the hands of the
assignor Partner.
11.2 General Limitations on Assignment. In addition to the other
requirements of this Agreement, no assignment of any Transferred Interests may
be made (i) if such assignment, together with
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all other assignments of Transferred Interests within the preceding twelve
months, would result in a termination of the Partnership for purposes of ss. 708
of the Code; (ii) if such assignment would violate the Securities Act of 1933,
as amended, or applicable state securities or blue sky laws or any other
applicable provisions of law in any respect; (iii) if such assignment would
cause the Partnership to be treated as an association taxable as a corporation
rather than as a partnership pursuant to the provisions of Subchapter K of the
Code; (iv) if such assignment is made outright to a minor or an incompetent (but
an assignment may be made to a trust for the benefit of a minor or an
incompetent); (v) unless the assignor and assignee duly execute such instruments
to reflect the assignment as the General Partner reasonably requests; or (vi)
unless the assignor delivers to the General Partner an opinion (if the General
Partner so requests), in form and substance and issued by counsel acceptable to
the General Partner, covering such aspects of the proposed assignment (including
without limitation those referred to in clauses (i), (ii) or (iii) of this
Section 11.2) as the General Partner may request. Any purported assignment that
does not comply with the provisions of this Article shall be void and
ineffectual and shall not bind the Partnership or the General Partner. Any
assignor who wishes to assign any Transferred Interests shall promptly notify
the General Partner of the same, furnish the General Partner with such
information regarding the assignment as may reasonably be requested by the
General Partner, and pay all expenses (including, without limitation, reasonable
attorneys' fees) incurred by the Partnership or the General Partner in
connection with such assignment.
11.3 Right of First Refusal.
(A) Subject to the restrictions and conditions of the
other provisions of this Article 11, no Limited Partner (or General Partner
under the circumstances provided for in Section 11.5(c)) or assignee shall
assign any Transferred Interests, and no Transferred Interests shall be
transferred on the books of the Partnership, unless (i) the Transferred
Interests are assigned to a Permitted Assignee as defined in Section 11.3(D) or
(ii) if the assignment is to a Person other than a Permitted Assignee, prior to
such transfer the assignor, or, in the case of an involuntary transfer, the
assignee (referred to in each case as the "Notifying Party") first gives written
notice (the "Offer Notice") to the Partnership and to the other Partners, which
Offer Notice shall set forth the Transferred Interests that are to be subject to
such assignment, the identity of the assignee, the consideration, if any, to be
received for the assignment, the other material terms of the assignment and a
copy of any written materials, agreement or contract setting forth such terms.
Each Limited Partner (other than any Partner making such assignment)
(collectively, the "Option Partners") shall then have the option for one hundred
eighty (180) days after the date of the Offer Notice to acquire its share (which
shall equal such Option Partner's Percentage Interest divided by the sum of the
Percentage Interests of all Option Partners) of the Transferred Interests at the
price and on the terms and conditions set forth in paragraph (B) of this Section
11.3. If some, but not all, of the Option Partners exercise their option to
purchase their share of the Transferred Interests, those Option Partners who so
exercised shall have a subsequent option for ten (10) days after the earlier of
(i) the expiration of such one hundred eighty (180) day period and (ii) the
exercise or waiver of the first option by the last Option Partner within which
to purchase some or all of the Transferred Interests which the other Option
Partners elected not to purchase. If exercise of this second option results in
Option Partners electing to purchase more of the remaining Transferred Interests
than are available, the portion of the remaining Transferred Interests that each
such Option Partner exercising the second option may purchase shall be equal to
that fraction which equals such Option Partner's Percentage Interest divided by
the Percentage Interests of all Option Partners exercising the second option.
Notwithstanding the foregoing, the Option Partners exercising options may
determine, by unanimous written agreement among themselves, the proportions in
which they may purchase the Transferred Interests. All exercises of options or
waivers
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of exercise hereunder shall be made by giving written notice to the Notifying
Party and to all of the Partners within the applicable time period. If any
Option Partner fails to give written notice of the exercise or waiver of an
option within the time periods herein set forth, then such Option Partner shall
be deemed to have waived the exercise of the option on the last day of the
relevant period. As to such portion or all of the Transferred Interests which
the Option Partners elect to purchase, a closing of the purchase shall be held
upon the later of (i) the date for purchase set forth in the Offer Notice or
(ii) twenty (20) days after the date of the last exercise or waiver of an option
hereunder. (The closing date may be extended for any time period required by the
appraisal procedure set forth in Exhibit B.) As to any portion of the
Transferred Interests which the Option Partners elect not to purchase, such
portion may be assigned to the Person and on the terms set forth in the Offer
Notice at any time or times within the thirty (30) day period next following the
waiver or exercise of the last applicable option under this paragraph, but if
the assignment shall not be consummated to such Person on such terms within such
thirty (30) day period, then the Option Partners' right of notice and right to
purchase the Transferred Interests shall apply to any subsequent transfer of
that portion of the Transferred Interests.
(B) If the transfer is for a valuable consideration in
money or money's worth (including satisfaction of indebtedness), the purchase
price for the Transferred Interests shall equal the lesser of (i) the purchase
price set forth in the Offer Notice; (ii) the Capital Account of the Partner
relating to the Transferred Interests; (iii) the amount of the indebtedness to
be satisfied out of the Transferred Interest; or (iv) the fair market value of
the Transferred Interests determined in the manner provided in Exhibit B. If the
transfer is not for a valuable consideration in money or money's worth, the
purchase price shall equal the lesser of (i) Capital Account of the Limited
Partner relating to the Transferred Interest; or (ii) the fair market value of
the Transferred Interests determined in the manner provided in Exhibit B. The
determination of the amount of the purchase price shall be made by the Option
Partners who elect to purchase. In the event the Option Partners elect to
purchase at the price stated in the Offer Notice, that price may be paid in
accordance with the terms, if any, set forth in the Offer Notice.
(C) The provisions of this Section 11.3 shall apply
regardless of whether the Offer Notice contemplates only an assignment of the
economic interest in the Partnership or an assignment whereby the assignee would
become a Substituted Limited Partner. No assignee of a Limited Partner (or of a
direct or indirect assignee of a Limited Partner), including an assignee under
an assignment permitted under this Section 11.3, may become a Substituted
Limited Partner except as provided in Section 11.6.
(D) A Permitted Assignee shall be any of the following:
(1) Marvin J. Gralnick, Helene B. Gralnick, and
any of their descendants;
(2) Any corporation, partnership, limited
liability company or other legal entity 100% of the beneficial ownership of
which is owned by Permitted Assignees;
(3) Any trust set up for the primary benefit of
one or more Permitted Assignees;
(4) Any organization described in each of the
following Code sections: 170(b)(1)(A), 170(c), 2055(a) and 2522(a);
(5) A charitable remainder trust under Section
664 of the Code; or
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(6) Any other Person approved by the General
Partner and a Majority in Interest of the Limited Partners.
11.4 Certain Assignment Events Involving Limited Partners and
Assignees.
(A) If an individual Limited Partner or assignee of
Transferred Interests dies or a court of competent jurisdiction adjudges an
individual Limited Partner or assignee of Transferred Interests to be
incompetent to manage such Limited Partner's or assignee's person or property,
such Limited Partner's or assignee's executor, administrator, guardian,
conservator or other legal representative may exercise all such Limited
Partner's or assignee's rights and powers to settle such Limited Partner's or
assignee's estate or administer such Limited Partner's or assignee's property,
and shall be treated as an assignee of such Limited Partner's or assignee's
Transferred Interests. Such deemed assignment of such Transferred Interests
shall not be subject to the provisions of Sections 11.3(A), 11.3(B) or 11.3(C),
but shall otherwise be subject to the provisions of this Article 11. Any
assignment, distribution or conveyance by the estate of a deceased or an
incompetent Limited Partner shall be subject to the provisions of this Article
11.
(B) Upon the Bankruptcy of an individual Limited Partner
or assignee of Transferred Interests, such individual shall be deemed to have
assigned his Transferred Interests to the legally authorized personal
representative of such individual. As such, the deemed assignment of such
Transferred Interests shall be subject to the provisions of Article 11,
including without limitation Section 11.3 hereof. The Offer Notice shall be
deemed given on the date that the General Partner has actual knowledge of the
Bankruptcy.
(C) Upon the Bankruptcy, dissolution or other cessation
to exist as a legal entity of any Limited Partner or assignee of Transferred
Interests which is not an individual, such entity shall be deemed to have
assigned its Transferred Interests to the legally authorized personal
representative or successors of such entity. As such, the deemed assignment of
such Transferred Interests shall be subject to the provisions of Article 11,
including without limitation Section 11.3 hereof. The Offer Notice shall be
deemed given on the date that the General Partner has actual knowledge of the
Bankruptcy or dissolution.
(D) Any judgment creditor of any Limited Partner or
assignee of Transferred Interests shall have only the rights of a judgment
creditor set forth in Section 7.03 of the Act. In the event that any creditor of
a Limited Partner or assignee of Transferred Interests judicially or
nonjudicially forecloses on, obtains a charging order or otherwise acquires
title to any Transferred Interests owned by a Limited Partner or assignee of
Transferred Interests, such foreclosure or acquisition shall be deemed an
assignment of such Transferred Interests. As such, the deemed assignment of such
Transferred Interests shall be subject to the provisions of Article 11,
including without limitation Section 11.3 hereof. The Offer Notice shall be
deemed given on the date that the General Partner has actual knowledge of the
affected assignment.
(E) If the marital relationship of a Limited Partner or
assignee of Transferred Interests is terminated by the death of such Limited
Partner's or assignee's spouse or by divorce and (i) such Limited Partner or
assignee of Transferred Interests does not succeed to his or her spouse's
community interest, if any, in the Limited Partner's or assignee's interest in
the Partnership, or (ii) if any interest in the Partnership owned by the Limited
Partner or assignee of Transferred Interests devolves to
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his or her spouse as a result of divorce, then such Limited Partner or assignee
of Transferred Interests shall promptly notify the Partners of that fact,
stating the date of such death or divorce. Such an occurrence shall be treated
as an assignment as of the date of such notice, and such deemed assignment shall
be subject to the provisions of Article 11, including without limitation Section
11.3 hereof.
11.5 Certain Assignment Events Involving General Partner(s). No
General Partner may voluntarily transfer or assign any Units or interests in the
Partnership as a General Partner. Certain other events involving a General
Partner's Units are provided below.
(A) Any General Partner may voluntarily withdraw at any
time from the Partnership by giving written notice to that effect to the other
Partners. Upon such withdrawal, such General Partner shall no longer be a
General Partner or have any power to exercise any rights or powers of a General
Partner, such General Partner's partnership interest shall automatically be
converted into a limited partnership interest and the withdrawing General
Partner shall automatically become a Substituted Limited Partner under this
Agreement.
(B) Upon (i) the Bankruptcy or death of an individual
General Partner, (ii) the entry by a court of competent jurisdiction
adjudicating an individual General Partner mentally incompetent to manage his or
her person or property, or (iii) the Bankruptcy, dissolution or other cessation
to exist as a legal entity of any General Partner which is not an individual,
such General Partner or assignee shall be deemed to have assigned its
Transferred Interests to its legally authorized personal representative or
successors. As such, the deemed assignment of such General Partner's Transferred
Interests shall be subject to the provisions of Article 11, including without
limitation Section 11.3 hereof. In addition, such General Partner shall also be
deemed to have withdrawn as a General Partner from the Partnership; such General
Partner shall no longer be a General Partner or have any power to exercise any
rights or powers of a General Partner; no Person shall be entitled to vote with
respect to the Units of such General Partner; and such Units shall be
disregarded for purposes of determining the vote required for any action to be
taken by the General Partner or the Partners.
(C) Any judgment creditor of any General Partner shall
have only the rights of a judgment creditor set forth in Section 7.03 of the
Act. In the event that any creditor of a General Partner judicially or
nonjudicially forecloses on, obtains a charging order or otherwise acquires
title to any Transferred Interests owned by a General Partner, such foreclosure
or acquisition shall be deemed an assignment of such Transferred Interests. As
such, the deemed assignment of such Transferred Interests shall be subject to
the provisions of Article 11, including without limitation Section 11.03 hereof.
(D) Upon the voluntary or involuntary assignment by a
General Partner of any of the Units owned by such General Partner in violation
of this Agreement, the General Partner's status as a General Partner may be
terminated by a Majority in Interest of the Limited Partners (not including the
affected General Partner to the extent of any Units owned as a Limited Partner).
In such an event, the General Partner shall be deemed to have withdrawn as a
General Partner from the Partnership; such General Partner shall no longer be a
General Partner or have any power to exercise any rights or powers of a General
Partner; no Person shall be entitled to vote with respect to the Units of such
General Partner and such Units shall be disregarded for purposes of determining
the vote required for any action to be taken by the General Partner or the
Partners.
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11.6 Substituted Limited Partner.
(A) No assignee of Transferred Interests (including
without limitation purchasers of Transferred Interests under Section 11.3) shall
have the right to become a Substituted Limited Partner except upon the written
consent of the General Partner, the granting or denying of which consent shall
be in the sole determination of the General Partner and, if granted, may be
granted subject to whatever conditions, if any, the General Partner may require.
Notwithstanding any other provision of this Agreement, in no event may an
assignor of Transferred Interests make or enter into an agreement, oral or
written, with an assignee or potential assignee of Transferred Interests
pursuant to which the assignor agrees to exercise its residual rights in the
Partnership at the direction or instruction of any assignee of such Transferred
Interests and any such purported agreement shall be null and void.
(B) Notwithstanding any granting of consent by the
General Partner pursuant to paragraph (A) of this Section 11.6, the admission of
an assignee as a Substituted Limited Partner shall be further conditioned as
follows:
(1) The assignment instrument and such other
instruments as the General Partner may deem necessary or desirable to
effect the admission of the assignee as a Substituted Limited Partner
being in form and substance satisfactory to the General Partner;
(2) The assignor and assignee executing such
other instrument or instruments as the General Partner may deem
necessary or desirable to effect such admission;
(3) The assignee and the assignee's spouse (if
any) accepting and adopting in writing all the terms and provisions of
this Agreement, as the same may have been amended;
(4) The assignee and/or the assignor paying or
obligating themselves to pay all reasonable expenses connected with
such admission (as determined by the General Partner, but which the
General Partner shall have the right to waive), including, but not
limited to, the cost of the preparation, filing and publishing of any
appropriate documents; and
(5) Such other conditions as the General Partner
may reasonably impose.
ARTICLE 12
DISSOLUTION AND TERMINATION
12.1 Dissolution. The first to occur of the following events
("Dissolving Events") shall cause the dissolution of the Partnership:
(A) December 31, 2035;
(B) The decision by the General Partner and all of the
Limited Partners to dissolve the Partnership;
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(C) The removal of the last remaining General Partner
pursuant to Section 10.3(B) or the withdrawal of the last remaining General
Partner;
(D) Entry of a decree of judicial dissolution under
Section 8.02 of the Act; and
(E) The occurrence of any other circumstance or event
which, by law, would result in dissolution of the Partnership.
12.2 Continuation of Business and Reconstitution of Partnership. If
a Dissolving Event described in Section 12.1(C) or 12.1(E) occurs, the
Partnership may be reconstituted and its business continued without being wound
up if (i) there remains at least one General Partner, in which case such
remaining General Partner shall be permitted to carry on the business of the
Partnership; or (ii) within 90 days after the date of removal or withdrawal of
the General Partner that constituted the Dissolving Event under Section 12(C),
at least a Majority in Interest of the Limited Partners agree in writing to
continue the business of the Partnership and, to the extent that they agree to
the appointment, effective as of the date of removal or withdrawal, of one or
more new general partners and agree to dilute their Units pro rata to provide
Units for each such new General Partner which represent no less than a one
percent (1%) Percentage Interest. If the Partnership is dissolved as a result of
an event described in Section 12.1(C), and if there is no remaining General
Partner, a Majority in Interest of the Limited Partners may appoint an interim
manager of the Partnership, who shall have and may exercise only the rights,
powers and duties of a General Partner necessary to preserve the Partnership
assets, until (a) a new General Partner is appointed pursuant to this Section
12.2, if the Partnership is reconstituted, or (b) the Liquidator (as defined
below) is appointed pursuant to Section 12.3, if the Partnership is not
reconstituted. The interim manager shall not be liable as a general partner to
the Limited Partners and shall, while acting in the capacity of interim manager
on behalf of the Partnership, be entitled to the same indemnification rights as
are set forth in Section 15.20.
12.3 Winding-Up and Termination.
(A) On the dissolution of the Partnership, unless it is
reconstituted in accordance with Section 12.2, the Partnership's affairs shall
be wound up and the Partnership terminated as soon as reasonably practicable by
the General Partner or, if there is no remaining General Partner, by such other
Person or Persons designated by a Majority in Interest of the Limited Partners
(such General Partner or other Person being referred to as the "Liquidator" for
purposes of this Article) and the Liquidator shall have exclusive authority and
responsibility for liquidating the Partnership in the manner set forth in this
Article. The Liquidator (if not a General Partner) shall be entitled to receive
such reasonable compensation for its services as shall be agreed upon by the
Liquidator and a Majority in Interest of the Limited Partners. The Liquidator
may resign at any time by giving fifteen (15) days prior written notice to the
Partners and may be removed at any time, with or without cause, or a successor
Liquidator appointed upon such removal or upon the death, dissolution or
resignation of the Liquidator, by written notice signed by or on behalf of a
Majority in Interest of the Limited Partners. The Liquidator shall have and may
exercise all of the powers conferred upon the General Partner under the terms of
this Agreement to the extent necessary or desirable to perform its duties and
functions under this Article, and shall have full right and discretion to
determine the time, manner and terms of any sale or sales of Partnership
property in connection with the liquidation of the Partnership, having due
regard for the activity and condition of the relevant markets and general
financial and economic conditions. The Liquidator (if not a General Partner)
shall not be liable as a general partner to the Limited Partners and shall,
while acting
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in such capacity on behalf of the Partnership, be entitled to the same
indemnification rights as are set forth in Section 15.20.
(B) Following the occurrence of a Dissolving Event, if
the Partnership is not to be reconstituted, the Partnership's activities shall
be strictly limited to winding up its affairs. In the course of the winding up
and terminating the business and affairs of the Partnership, the assets (other
than cash) of the Partnership that are not to be distributed under Section
12.3(D) shall be liquidated as promptly as is consistent with obtaining fair
value therefor. Thereafter, such assets shall be applied and distributed in the
following order:
(1) first, to Partnership creditors (other than
Partners) to extinguish Partnership liabilities and obligations,
including the costs and expenses of liquidation; and
(2) second, to repay the Partners (General or
Limited) any sums lent to the Partnership by the Partners to the extent
not previously paid.
Any net assets of the Partnership remaining after the foregoing distributions
(the "Liquidation Proceeds") shall be distributed to the Partners as set forth
in Section 12.3(C) below.
(C) The Liquidation Proceeds of the Partnership (less any
reasonable portion thereof reserved by the Liquidator for a reasonable time to
pay contingent or unforeseen Partnership liabilities) shall be distributed in
one or more installments to the Partners in accordance with their positive
Capital Account balances, after taking into account all Capital Account
adjustments for the Partnership's taxable year during which the winding up of
business occurs. All distributions to Partners who have positive Capital Account
balances, whether in cash pursuant to this Section 12.3(C) or in kind pursuant
to Section 12.3(D), shall be made in compliance with Regulations ss.
1.704-1(b)(2)(ii)(b)(2), and, if any General Partner's Capital Account has a
deficit balance, after taking into account all Capital Account adjustments for
the Partnership's taxable year during which the winding up of business occurs,
such General Partner shall contribute to the Partnership the amount necessary to
restore such deficit balance to zero in compliance with Regulations ss.
1.704-1(b)(2)(ii)(b)(3) and in accordance with Section 5.1(D).
(D) If a distribution of Partnership property in kind is
made, such property shall be either, in the discretion of the Liquidator: (i)
transferred and conveyed to the Partners so as to vest in each of them, as
tenants in common, a percentage interest in the whole of said property; or (ii)
transferred and conveyed to the Partners on an asset-by-asset basis, so that
each Partner receives his, her or its appropriate portion of the Net Asset Value
of the Partnership (as determined in accordance with the final positive Capital
Account balances of the Partners). If the Liquidator determines to transfer any
property to the Partners on an asset-by-asset basis, and the Liquidator and the
Partners cannot agree on the valuation of the assets of the Partnership within
thirty (30) days after the date of such determination, then the value of the
assets shall be determined by an appraisal in the following manner: one (1)
appraiser shall be named by the Liquidator and one (1) appraiser shall be named
by a Majority in Interest of the Partners. The initial selection of an appraiser
shall be made by the Liquidator within ten (10) days after the expiration of
such thirty (30) day period by sending notification of such selection to the
Partners. Unless a Majority in Interest of the Partners selects the other
appraiser and notifies the Liquidator of such selection within ten (10) days
after such notice from the Liquidator, then the decision of the appraiser
selected by the Liquidator shall be final and binding on all parties. If a
second appraiser is selected, and if the two (2) appraisers cannot agree upon
the value of such assets within ten (10) days after the selection of the second
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appraiser, the appraisers shall immediately appoint a third appraiser and the
median value determined by all three (3) appraisers shall be final and binding
on all parties. The cost of any appraisal undertaken pursuant to the terms of
this Section shall be an expense of the Partnership. Except to the extent the
Liquidator determines to make a distribution under this Section 12.3(D), no
Partner shall have any right to demand or receive property other than cash upon
dissolution and termination of the Partnership.
(E) A reasonable time shall be allowed for the orderly
liquidation of the assets of the Partnership and the discharge of liabilities as
to creditors.
(F) Within ninety (90) days after the complete
liquidation of the Partnership, the General Partner or his executors or
representatives shall satisfy any requirement to contribute cash to the
Partnership pursuant to Section 5.1(D). In addition, the Liquidator shall
furnish to each of the Partners a statement for the period from the first day of
the then current fiscal year through the date of such complete liquidation. Such
statement shall include a Partnership statement of operations for such period
and a Partnership balance sheet as of the date of such complete liquidation.
Upon compliance with the foregoing distribution plan, the Partners shall cease
to be such, and the Liquidator shall execute, acknowledge and cause to be filed
a Certificate of Cancellation of the Partnership. No Limited Partner shall be
obligated to restore any deficit in such Limited Partner's Capital Account
solely by reason of a negative balance in such Limited Partner's Capital
Account.
ARTICLE 13
POWER OF ATTORNEY
13.1 Appointment of Power of Attorney.
(A) Each of the Limited Partners hereby irrevocably
constitutes and appoints each General Partner, with full power to act alone and
to designate substitutes, as its true and lawful attorney-in-fact on its behalf
and in its name, place and stead to make, execute, consent to, swear to,
acknowledge, record and file the following:
(1) A Certificate of Limited Partnership,
Assumed Name Certificates, Applications for Certificate of Authority
and any other certificates or other instruments which may be required
to be filed by the Partnership or the Partners under the laws of the
State of Texas and under the applicable laws of any other jurisdiction
to the extent that the General Partner deems such filing to be
necessary or desirable, including any and all amendments, cancellations
or terminations thereof;
(2) All instruments that effect a change or
modification of the Partnership in accordance with this Agreement,
including any amendment to this Agreement made in accordance with the
terms hereof; and
(3) All such other instruments as the General
Partner may deem necessary or desirable to carry out fully the
provisions of this Agreement in accordance with its terms.
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(B) It is expressly understood and intended by each of
the Limited Partners that the grant of the foregoing power of attorney is
coupled with an interest, shall be irrevocable and shall be binding on any
assignee of all or any part of its interest in the Partnership.
(C) To the extent allowed by law, the foregoing power of
attorney shall survive the death, legal incapacity, Bankruptcy, insolvency,
dissolution or other cessation to exist as an entity of a Limited Partner during
the term hereof and shall survive the delivery of any assignment by a Limited
Partner of the whole or any portion of its interest in the Partnership, and any
assignee of such Limited Partner does hereby constitute and appoint the General
Partner his, her or its attorney in the same manner and force and for the same
purposes as does the assignor.
(D) The foregoing power of attorney may be exercised by
the General Partner, on behalf of the Limited Partners by executing any
instrument along with a single signature as attorney-in-fact for them.
ARTICLE 14
AMENDMENT
14.1 Procedure for Amendment. This Agreement shall be amended upon
the written consent or affirmative vote of the General Partner and a Majority in
Interest of the Limited Partners, provided, however, that the unanimous consent
of all Partners shall be necessary for any amendment which would (a) alter any
Partner's Percentage Interest (except in accordance with the existing provisions
of this Agreement), (b) alter the manner of distributing Net Cash Flow or Net
Cash From Sales or Refinancings or allocating Loss or Profit, (c) impose a new,
material obligation on a Partner or remove a material right of a Partner, (d)
alter any provision of this Agreement which currently requires the consent or
vote of all of the Partners or of more than a Majority in Interest of the
Limited Partners or of any class of Limited Partners as a condition to certain
actions or omissions, or (e) amend this Section 14.1. In addition, the General
Partner may amend this Agreement without the affirmative vote or written consent
of the Limited Partners (i) if the General Partner is advised by counsel to the
Partnership that such amendment is required as a condition to maintain the tax
status of the Partnership as a partnership or to cause Partnership tax
allocations to have substantial economic effect, or (ii) to correct a false
statement or error in this Agreement if the correction will not adversely affect
the rights and interests of the Limited Partners or decrease the obligations and
duties of the General Partner. The General Partner shall, within thirty (30)
days after the making of any amendment to this Agreement, file or cause to be
filed such amendment in all places where such filing is necessary or desirable
to protect the interests of the Limited Partners or to comply with any
applicable law.
ARTICLE 15
MISCELLANEOUS PROVISIONS
15.1 Meetings. Meetings of the Partners may be called by any
General Partner or by a Majority in Interest of the Limited Partners. The time
and place of any such meeting shall be designated
25
<PAGE> 30
by the parties calling the meeting. All meetings will be held within the State
of Texas unless otherwise agreed to by the General Partner and a Majority in
Interest of the Limited Partners.
15.2 Governing Law. This Agreement and the rights of the parties
hereunder shall be interpreted in accordance with the laws of the State of
Texas, including without limitation the Act, without regard to principles of
conflicts of law.
15.3 Title. A Partner's interest in the Partnership shall be
personal property for all purposes. All real and other property owned by the
Partnership shall be deemed to be owned by the Partnership as an entity (but may
be held in the name of a nominee for the Partnership), and no Partner
individually shall have any ownership of such property.
15.4 Consents and Approvals. Whenever under this Agreement the
vote, consent or approval of any Partner is required or permitted, such consent
or approval may be evidenced by a written consent signed by such Partner.
15.5 Notices. All notices under this Agreement shall be in writing
and shall be given to the parties at the address set forth beneath their
signature to this Agreement (or on a counterpart signature page) and to the
Partnership at its principal office or at such other address as any of the
parties may hereafter specify by notice to the Partnership and the other
Partners. Unless delivered personally (including, but not limited to, delivery
by courier or facsimile transmission), such notices shall be given by registered
or certified mail, postage prepaid, return receipt requested. All notices shall
be effective when so delivered or five days after being so mailed.
15.6 Controlling Provision. Any other provision of this Agreement
to the contrary notwithstanding, no Partner shall have any power whatsoever
(whether directly or indirectly) in (i) the determination of whether to retain
or distribute Partnership earnings and profits, (ii) the management of the
Partnership, or (iii) any other matter, that in any event would cause a
partnership interest which was the subject of a gift by such Partner (or by a
shareholder of such Partner, in the case of a Partner who is a corporation) to
be includible in such Partner's (or shareholder's, if applicable) gross estate
for federal estate tax purposes.
15.7 Execution in Counterparts. This Agreement may be executed in
any number of counterparts with the same effect as if all parties had signed the
same document. All counterparts shall be construed together and shall constitute
one agreement.
15.8 Reliance on Opinion of Counsel. The doing of any act or the
failure to do any act by the General Partner, the effect of which may cause or
result in loss or damage to the Partnership, if done or omitted pursuant to an
opinion of legal counsel employed by the General Partner on behalf of the
Partnership, shall not subject the General Partner to any liability.
15.9 Scope of Partners' Authority. Except as otherwise provided in
this Agreement, none of the Partners shall have any authority to act for, or to
assume any obligations or responsibilities on behalf of, any other Partner or
the Partnership. No Person dealing with the General Partner shall be required to
determine his authority to make any undertaking on behalf of the Partnership or
to determine any fact or circumstance bearing upon the existence of such
authority.
26
<PAGE> 31
15.10 Execution of Partnership Documents. Any contract, agreement,
instrument or other document to which the Partnership is a party shall be signed
by the General Partner or by his attorneys in fact on behalf of the Partnership
and no other signatures shall be required unless otherwise required by
applicable law.
15.11 Waiver of Partition. Each of the Partners irrevocably waives
during the term of the Partnership any right to bring or maintain any action for
partition with respect to the property of the Partnership.
15.12 Time. Time is of the essence in this Agreement.
15.13 Binding Effect. Subject to the limits on assignment contained
herein, each and all of the covenants, terms, provisions and agreements
contained herein shall be binding upon and inure to the benefit of the parties,
their respective heirs, assigns, successors and legal representatives.
15.14 Entire Agreement. This Agreement, including the Exhibits
hereto, contains the entire agreement between the parties relative to the
formation and operation of the Partnership. This agreement supersedes any prior
understandings or oral or written agreements between the parties respecting the
subject matter of this Agreement.
15.15 Remedies Not Exclusive. Any remedies herein contained for
breaches of obligations hereunder shall not be deemed to be exclusive and shall
not impair the right of any party to exercise any other right or remedy, whether
for damages, injunction or otherwise.
15.16 Severability. If any term or other provision of this Agreement
is invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner materially
adverse to any party. Upon such determination that any term or other provision
is invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the end
that the transactions contemplated hereby are fulfilled to the extent possible.
15.17 Captions. Article or Section titles or captions contained in
this Agreement are inserted only as a matter of convenience and for reference
and in no way define, limit, extend or describe the scope of this Agreement or
the intent of any provision hereof.
15.18 Identification. Whenever the singular number is used in this
Agreement and when required by the context, the same shall include the plural,
and the masculine gender shall include the feminine and neuter genders.
15.19 Certain Representations. Each Partner hereby represents and
warrants to the other Partners that at the time of such Partner's acquisition of
an interest in the Partnership (i) such Partner is aware that interests in the
Partnership are not being registered under the Securities Act of 1933, as
amended, or under the Texas Securities Act or any other state securities law, in
reliance upon certain exemptions from registration, (ii) certain provisions of
this Agreement and state and federal securities laws limit and condition the
right and ability of the Partner to transfer its interest in the Partnership,
and
27
<PAGE> 32
therefore, the Partner's interest in the Partnership is illiquid; and (iii) such
Partner is not acquiring an interest in the Partnership with the intent of
making any distribution which would violate any applicable securities law.
15.20 Limited Liability and Indemnification of the General Partner.
(A) No General Partner shall be liable to the Partnership
or any of the Limited Partners for any act or omission performed or omitted by
him in good faith pursuant to the authority granted to him by this Agreement, or
in accordance with its provisions, and in a manner reasonably believed by the
General Partner to be within the scope of the authority granted the General
Partner and in the best interest of the Partnership, provided that such act or
omission did not constitute fraud, bad faith, or gross negligence. The
Partnership shall indemnify and hold harmless the General Partner for any
liability, loss, damage, cost or expense (including without limitation
attorneys' fees) incurred by him on behalf of the Partnership or in furtherance
of the Partnership's interest, except for liability arising out of fraud, bad
faith or gross negligence. In addition, to the full extent permitted by
applicable law (including without limitation Article 11 of the Act), the
Partnership shall indemnify and hold harmless each General Partner from, and
reimburse the General Partner for, all judgments, penalties, including excise
and similar taxes, fines, settlements and reasonable expenses (including court
costs and attorneys' fees) if the General Partner was, is or is threatened to be
named a defendant or respondent in a proceeding because such Person is or was a
general partner of the partnership. The foregoing shall, without limitation, be
deemed to make mandatory the indemnification permitted under Section 11.02 of
the Act and to authorize advance payment of expenses to the full extent
permitted by applicable law. These indemnification rights are in addition to any
other rights the General Partner may have, including, but not limited to, rights
against third parties, and rights under any applicable statute, agreement,
insurance policy, vote of the Partners, or otherwise.
(B) In the event a General Partner pays any debt of the
Partnership (other than a debt incurred under circumstances such that the
General Partner is not entitled to indemnification under Section 15.20(A) of
this Agreement), such General Partner shall be reimbursed therefor from
Partnership assets.
15.21 Further Assurances. Each party agrees to perform any further
acts and execute and deliver any further documents which may be reasonably
necessary from time to time in order to carry out or to effectuate the intent of
this Agreement.
15.22 Spousal Consent. The spouses of the Partners, if any, are
fully aware of, understand, and fully consent and agree to, the provisions of
this Agreement and its binding effect upon any community property interests they
may now or hereafter own, and agree that the termination of their marital
relationship with any Partner for any reason shall not have the effect of
removing any interests in the Partnership otherwise subject to this Agreement
from the coverage hereof, and that their awareness, understanding, consent and
agreement are evidenced by their signing this Agreement. Further, such spouses
agree that in the case of any interest in the Partnership that is the community
property of such spouse and a Partner, all rights of management, control and
disposition (within the meaning of the Texas Family Code) of such community
property shall be exercisable solely by such Partner, unless such Partner is
under a disability. Nothing contained in this Agreement, or in any other
document executed in connection herewith, however, shall constitute a
representation or admission by any party that any interest
28
<PAGE> 33
in the Partnership constitutes community property or subject such spouse's
separate property to any liability of the Partnership.
IN WITNESS WHEREOF, the parties have signed and acknowledged this
instrument as of the day and year first above written.
GENERAL PARTNER:
KLEE & COMPANY, L.L.C.
Address:
301 Congress Avenue, Suite 1900
Austin, Texas 78701
By:
--------------------------------------
Marvin J. Gralnick, Manager
By:
--------------------------------------
Helene B. Gralnick, Manager
29
<PAGE> 34
IN WITNESS WHEREOF, the parties have signed and acknowledged this
instrument as of the day and year first above written.
LIMITED PARTNERS:
--------------------------------------------
SOUTHPAC TRUST INTERNATIONAL INC.,
TRUSTEE OF THE JOSEPH TRUST UNDER
AGREEMENT DATED JANUARY 26, 1995, BY ITS
AUTHORIZED SIGNATORY
Address: Centrepoint
P.O. Box 11
Rarotonga, Cook Islands
--------------------------------------------
SOUTHPAC TRUST INTERNATIONAL INC.,
TRUSTEE OF THE SAMUEL TRUST UNDER
AGREEMENT DATED JANUARY 26, 1995, BY ITS
AUTHORIZED SIGNATORY
Address: Centrepoint
P. O. Box 11
Rarotonga, Cook Islands
30
<PAGE> 35
EXHIBIT A
to
LIMITED PARTNERSHIP AGREEMENT
OF RODIN, LTD.
Property Contributed by Partners
<TABLE>
<CAPTION>
Type of
Name of Partner Partner Property Contributed Net Asset Value Units
- --------------- -------- -------------------- --------------- -----
<S> <C> <C> <C> <C>
Klee & Company, L.L.C. General See Exhibit A-1 $ 83,043.24 83.043
Southpac Trust International Limited See Exhibit A-2 4,110,465.06 4,110.465
Inc., Trustee of The Joseph
Trust
Southpac Trust International Limited See Exhibit A-2 4,110,465.06 4,110.465
Inc., Trustee of The Samuel
Trust
============= =========
TOTAL $8,303,973.36 8,303.973
</TABLE>
<PAGE> 36
EXHIBIT A-1
Property Contributed by General Partner
<TABLE>
<CAPTION>
Name of Partner Property Contributed Net Asset Value
- --------------- -------------------- ---------------
<S> <C> <C>
Klee & Company, L.L.C. 17,052 shares of common $83,043.24
stock of Chico's FAS, Inc.
(valued at $4.87 per share)
</TABLE>
<PAGE> 37
EXHIBIT A-2
Property Contributed by Limited Partners
<TABLE>
<CAPTION>
Name of Partner Property Contributed Net Asset Value
- --------------- -------------------- ---------------
<S> <C> <C>
Southpac Trust International 844,038 shares of common $4,110,465.06
Inc., Trustee of The Joseph stock of Chico's FAS, Inc.
Trust (valued at $4.87 per share)
Southpac Trust International 844,038 shares of common 4,110,465.06
Inc., Trustee of The Samuel stock of Chico's FAS, Inc.
Trust (valued at $4.87 per share)
</TABLE>
<PAGE> 38
EXHIBIT B
DETERMINATION OF FAIR MARKET VALUE
OF PARTNERSHIP INTEREST
In the event a determination of the fair market value of Transferred
Interests is required pursuant to any provision of the Agreement, the following
provisions shall be applicable:
A. The fair market value of any Transferred Interest shall be the
price at which the interest would change hands between a willing seller and a
willing buyer, neither being under any compulsion to buy or to sell, and both
having reasonable knowledge of relevant facts, including, but not limited to,
all facts relevant for determining under sections 2031 and 2512 of the Code the
fair market value of closely held partnership interests which may not be
withdrawn before the end of the term of the Partnership.
B. The Notifying Party (herein referred to as the "Seller") and
the purchasing Option Partners (herein referred to as the "Purchaser") shall
first attempt to determine the fair market value of the affected Transferred
Interest (the "Affected Interest") by agreement. If Seller and Purchaser are
unable to agree on the fair market value of the Affected Interest within fifteen
(15) days after the Purchaser has received an Offer Notice, each of Seller and
Purchaser shall, within the period of an additional fifteen (15) days, name a
qualified appraiser and supply the name of such appraiser to the other party. If
either Seller or Purchaser fails to appoint an appraiser, the determination of
fair market value of the Affected Interest shall be made by the sole appraiser
appointed. If two appraisers are selected, then, within the period of thirty
(30) days after the appointment of the second appraiser, the two appraisers
shall separately determine the fair market value of the Affected Interest and
shall provide copies of their written reports to each of Seller and Purchaser.
If the difference between the two appraisal reports is ten percent (10%) or less
(the higher report being less than the lower report multiplied by 1.1) the
average of the appraisals shall conclusively determine the fair market value of
the Affected Interest. If the difference between the two appraisal reports is
greater than ten percent (10%), the two appraisers shall appoint a third
qualified appraiser, who shall select between the two appraisal reports as to
the fair market value of the Affected Interest. The opinion of the third
appraiser shall be conclusive of the fair market value of the Affected Interest.
If the two appraisers cannot agree upon a third appraiser, that appointment
shall be made by the Chief Judge of the United States District Court for the
Western District of Texas, Austin Division, upon the petition of either Seller
or Purchaser.
C. For purposes hereof, an appraiser shall be "qualified" if he
would be considered an expert for purposes of giving testimony as to the fair
market value per Unit of the Partnership in a judicial or similar proceeding.
The costs and expenses of the appraiser selected by Seller or Purchaser shall be
borne by the party selecting the appraiser. The costs and expenses of a third
appraiser shall be borne equally by Seller and Purchaser.
D. During the period of time that a determination of the fair
market value of the Affected Interest is being made pursuant to the procedures
set forth in this Exhibit B, all time periods for notice or exercise of any
rights related to the purchase shall be suspended. Upon the final determination
of fair market value, all time limits shall automatically commence.
<PAGE> 39
EXHIBIT C
SPECIAL ALLOCATIONS
For federal income tax purposes, the following provisions shall
supersede any allocations of Profits or Losses provided for in Article 6 of the
Agreement.
Defined Terms:
C-(1) "Adjusted Capital Account Deficit" means, with respect to any
Partner, the deficit balance, if any, in such Partner's Capital Account as of
the end of the relevant fiscal year, after giving effect to the following
adjustments:
(a) Credit to such Capital Account any amounts
which such Partner is obligated to restore pursuant to any provision of the
Agreement, this Exhibit C, the Act or applicable law, or is deemed to be
obligated to restore in connection with a Partner's share of partnership minimum
gain pursuant to Regulations ss. 1.704-2(g)(ii) or in connection with a
Partner's share of minimum gain attributable to any Partner's nonrecourse debt
pursuant to Regulations ss. 1.704-2(i)(5); and
(b) Debit to such Capital Account the items
described in Regulations ss.ss. 1.704-1(b)(2)(ii)(d)(4), (5) and (6).
This definition of Adjusted Capital Account Deficit is intended to comply with
Regulations ss. 1.704-1(b)(2)(ii)(d), and shall be interpreted consistently
with that provision.
C-(2) "Pre-Contribution Gain" means that portion of the total
taxable gain incurred by the Partnership with respect to an asset contributed by
a Partner to the capital of the Partnership to the extent that such gain does
not exceed the difference between (a) the initial Asset Value of the asset minus
the amount of Depreciation claimed by the Partnership in respect of such asset
and (b) the contributing Partner's adjusted basis in such asset for federal
income tax purposes at the time the asset is contributed to the Partnership
minus the actual depreciation, amortization or cost recovery deductions ("Tax
Depreciation") claimed in respect of the asset for federal income tax purposes.
If pursuant to Regulations promulgated under ss. 704(c) of the Code
disproportionate allocations of Tax Depreciation deductions in respect of
property contributed to the Partnership are not required to be made, or if no
Tax Depreciation deductions are allowable with respect thereto, the amount of
Pre-Contribution Gain shall instead be determined without reference to
Depreciation deductions or Tax Depreciation deductions claimed in respect of the
asset. In the event that the actual gain recognized upon the sale or other
disposition of any such asset for federal income tax purposes is less than the
amount determined above, Pre-Contribution Gain with respect to the asset shall
be such lesser amount.
C-(3) "Pre-Contribution Loss" shall mean that portion of the total
taxable loss incurred by the Partnership with respect to an asset contributed by
a Partner to the capital of the Partnership to the extent that such loss does
not exceed the difference between (c) the contributing Partner's adjusted basis
in such asset for federal income tax purposes at the time the asset is
contributed to the Partnership minus Tax Depreciation (as defined above)
deductions claimed in respect of the asset for federal income tax purposes and
(d) the initial Asset Value of the asset minus the amount of Depreciation
deductions claimed by the Partnership in respect of such asset. If pursuant to
Regulations promulgated under ss. 704(c) of the Code disproportionate
allocations of Tax Depreciation deductions in respect of property contributed to
the Partnership are not required to be made, or if no Tax Depreciation
deductions are allowable with respect thereto, the amount of Pre-Contribution
Loss shall instead be determined without reference to Depreciation
<PAGE> 40
deductions or Tax Depreciation deductions claimed in respect of such asset. In
the event that the actual loss recognized upon the sale or other disposition of
any such asset for federal income tax purposes is less than the amount
determined above, Pre-Contribution Loss with respect to the asset shall be such
lesser amount.
C-(4) Special Allocations. The following allocations, which
supersede those of Sections 6.1 and 6.2 of the Agreement, shall be made in the
following order:
(a) Minimum Gain Chargeback. Notwithstanding any
other provision of Article 6 of the Agreement or of this Exhibit C, if there is
a net decrease in Partnership Minimum Gain during any Partnership fiscal year,
each Partner shall be specially allocated items of Partnership income and gain
for such year (and, if necessary, subsequent years) in an amount equal to the
greater of (i) the portion of such Partner's share of the net decrease in
Partnership Minimum Gain, determined in accordance with Regulations ss.
1.704-2(g)(2) or (ii) if such Partner would otherwise have an Adjusted Capital
Account Deficit at the end of such year, an amount sufficient to eliminate such
Adjusted Capital Account Deficit. Allocations pursuant to the previous sentence
each year shall be made in proportion to the respective amounts required to be
allocated among the Partners pursuant thereto. The items to be so allocated
shall be determined in accordance with Regulations ss. 1.704-2(f)(6) and this
provision shall be interpreted consistently therewith. To the extent permitted
by the Regulations and for purposes of this provision only, each Partner's
Adjusted Capital Account Deficit shall be determined prior to any other
allocations pursuant to this Agreement with respect to such fiscal year and
without regard to any net decrease in Partner Minimum Gain during such fiscal
year. For the purposes of this Exhibit C:
(1) "Nonrecourse Liability" has the
meaning set forth in Regulations ss. 1.704-2(b)(3).
(2) "Partnership Minimum Gain" has the
meaning set forth in Regulations ss. 1.704-2(d).
(b) Partner Funded Deductions. Any Partner
Funded Deductions for any fiscal year or other period shall be specially
allocated to the Partner who bears the economic risk of loss with respect to the
Partner Funded Debt to which such Partner Funded Deductions are attributable in
accordance with Regulations ss. 1.704-2(i)(l). For the purposes of this Exhibit
C:
(1) "Partner Funded Debt" has the
meaning ascribed to "partner nonrecourse debt" as set forth in Regulations ss.
1.704-2(b)(4);
(2) "Partner Funded Deductions" has the
meaning ascribed to "partner nonrecourse deductions" as set forth in Regulations
ss. 1.704-2(i)(2); and
(3) "Partner Minimum Gain" has the
meaning ascribed to "partner nonrecourse debt minimum gain" as set forth in
Regulations ss. 1.704-2(i)(2).
(c) Partner Minimum Gain Chargeback.
Notwithstanding any other provision of Article 6 except Section C-4(a) above, if
there is a net decrease in Partner Minimum Gain attributable to a Partner Funded
Debt during any Partnership fiscal year, each Partner who has a share of the
Partner Minimum Gain attributable to such Partner Funded Debt, determined in
accordance with Regulations
2
<PAGE> 41
ss. 1.704-2(i)(5), shall be specially allocated items of Partnership income and
gain for such year (and, if necessary, subsequent years) in an amount equal to
the greater of (i) the portion of such Partner's share of the net decrease in
Partner Minimum Gain, determined in accordance with Regulations ss.
1.704-2(i)(4), or (ii) if such Partner would otherwise have an Adjusted Capital
Account Deficit at the end of such year, an amount sufficient to eliminate such
Adjusted Capital Account Deficit. Allocations pursuant to the previous sentence
shall be made each year in proportion to the respective amounts required to be
allocated among the Partners. The items to be so allocated shall be determined
in accordance with Regulations ss. 1.704-2(j). This provision is intended to
comply with the partner nonrecourse debt minimum gain chargeback requirement in
Regulations ss. 1.704-2(i)(4) and shall be interpreted consistently therewith.
Solely for purposes of this Section, each Partner's Adjusted Capital Account
Deficit shall be determined prior to any other allocations pursuant to this
Agreement with respect to such fiscal year, other than allocations pursuant to
C-(4)(a)of this Exhibit C.
(d) Qualified Income Offset. In the event any
Limited Partner unexpectedly receives any adjustments, allocations, or
distributions described in Regulations ss.ss. 1.704-1(b)(2)(ii)(d)(4),
1.704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6), items of Partnership income
and gain shall be specially allocated to each such Partner in an amount and
manner sufficient to eliminate, to the extent required by the Regulations, the
Adjusted Capital Account Deficit of such Partner as quickly as possible,
provided that an allocation pursuant to this provision shall be made if and only
to the extent that such Partner would have an Adjusted Capital Account Deficit
after all other allocations provided for in this Agreement have been tentatively
made as if this provision were not in this Agreement. This provision is intended
to comply with the qualified income offset requirement in Regulations ss.
1.704-1(b)(2)(ii)(d)(3) and shall be interpreted consistently therewith.
(e) Curative Allocations. The allocations set
forth in Section 6.1(B) of the Agreement and in Section C-(4)(a), C-(4)(b),
C-(4)(c) and C-(4)(d) of this Exhibit C (the "Regulatory Allocations") are
intended to comply with certain requirements of Regulations ss. 1.704-1(b).
Notwithstanding any other provision of Article 6 of the Agreement or this
Exhibit C (other than the Regulatory Allocations), all remaining Profits and
Losses shall be allocated among the Partners so that, when combined with the
Regulatory Allocations, the net allocations of Profits and Losses shall, to the
greatest extent possible, be equal to the net allocations that would have been
made pursuant to Article 6 of the Agreement and this Exhibit C had no such
Regulatory Allocations been required.
(f) Disallowed Deductions. In the event that any
amounts paid or payable to any Partner or any Affiliate which the Partnership
deducted or intended to deduct are disallowed as deductions for federal income
tax purposes (or it is determined that such amounts are no longer allowable as
deductions), then (i) the amounts thus disallowed or no longer allowable will be
allocated to the Partner who received them (or whose Affiliate received them) as
income, and (ii) notwithstanding any provision herein to the contrary, the
balance of the redetermined Profit or Loss of the Partnership for the taxable
year in question shall, to the extent permitted by law, be allocated among the
Partners to obtain the same allocation of Partnership Profit or Loss (after
giving effect to the income allocated pursuant to clause (i) hereof) as would
have been obtained for such taxable year if the amounts thus disallowed or no
longer allowable had been proper deductions by the Partnership. In particular,
but not by way of limitation, this subsection shall apply to any fees and
interest (including contingent interest) payable by the Partnership, all of
which the Partners intend to be expenses of the Partnership rather than
distributions to Partners.
3
<PAGE> 42
(g) Code Section 704(c) Allocations.
(1) In accordance with ss. 704(c) of
the Code and the Regulations thereunder, but solely for income tax purposes, all
Pre-Contribution Gain and all Pre-Contribution Loss with respect to an asset
contributed to the capital of the Partnership shall be specially allocated to
the Partner that contributed the asset.
(2) If the Partnership is eligible to
claim Tax Depreciation deductions in respect of any asset contributed to the
capital of the Partnership, such deductions shall be specially (i.e.,
disproportionately) allocated among the Partners other than the Partner that
contributed the asset to the greatest extent possible so that each such
noncontributing Partner receives Tax Depreciation deductions equal to the amount
of Depreciation deductions (computed pursuant to Section 2.1(A)(5) of this
Agreement) allocated to each such Partner's Capital Account. If the amount of
Tax Depreciation deductions are not sufficient to meet this requirement, such
Tax Depreciation deductions shall be allocated, pro rata, among such
noncontributing Partners in proportion to their respective Capital Accounts. The
balance, if any, of Tax Depreciation deductions shall be allocated to the
Partner that contributed the asset. As is the case with Pre-Contribution Gain
and Pre-Contribution Loss, allocations of Tax Depreciation deductions pursuant
to this provision shall be solely for income tax purposes and shall not affect
the Capital Account of any Partner.
4
<PAGE> 43
AMENDMENT NO. 1 TO
THE LIMITED PARTNERSHIP AGREEMENT OF
RODIN, LTD.
This Amendment No. 1 to the Limited Partnership Agreement of Rodin,
Ltd. (this "Amendment") is executed as of the 22nd day of December, 1995, by and
among Klee & Company, L.L.C., a Texas limited liability company (the "General
Partner"); Southpac Trust International Inc., as Trustee of The Samuel Trust
under agreement dated January 26, 1995 and Southpac Trust International Inc, as
Trustee of The Joseph Trust under Agreement dated January 26, 1995 (collectively
the "Limited Partners"); and, Helene B. Gralnick (the "Assignee") for the
purpose of amending that certain Limited Partnership Agreement of Rodin, Ltd.
(the "Partnership") entered into as of December 21, 1995, by and between the
General Partner and the Limited Partners (the "Agreement"), as follows:
1. The Agreement is hereby amended to reflect the transfer as of
December 22, 1995, by Southpac Trust International Inc., as Trustee of The
Samuel Trust under agreement dated January 26, 1995 ("The Samuel Trust"), of a
total of 22.216 Units (as defined in the Agreement) held by the Limited Partner,
Southpac Trust International Inc., as Trustee of The Samuel Trust, to the
Assignee. In order to incorporate the above-described change in the interests of
the Partners (as defined in the Agreement) into the Agreement, the Agreement is
hereby amended to add the Assignee as a limited partner of the Partnership with
respect to the Units so transferred and to reflect that following such transfer
the following persons shall hold the Units indicated beside such person's name
below:
<PAGE> 44
<TABLE>
<CAPTION>
Name of Partner Units
--------------- -----
<S> <C> <C>
1. Klee & Company, L.L.C. 83.043
2. Southpac Trust International Inc., as 4,088.249
Trustee of The Samuel Trust under
agreement dated January 26, 1995
3. Southpac Trust International Inc., as 4,110.465
Trustee of The Joseph Trust under
agreement dated January 26, 1995
4. Helene B. Gralnick 22.216
=========
TOTAL 8,303.973
</TABLE>
All references in the Agreement to distributions and allocations among
the Limited Partners in accordance with and pro rata to their Units shall
henceforth be deemed to refer to an allocation based on the above-listed Units.
2. The General Partner and the Limited Partners consent in accordance
with Section 14.1 of the Agreement to the foregoing amendment to the Agreement
and consent in accordance with Section 11.6(A) of the Agreement to the Assignee
becoming a Substituted Limited Partner with respect to the Units so transferred.
IN WITNESS WHEREOF, this Amendment has been duly executed in one or
more counterparts (each of which is deemed to be an original for all purposes)
by the parties hereto.
GENERAL PARTNER:
KLEE & COMPANY, L.L.C.
By:
---------------------------
Helene B. Gralnick, Manager
2
<PAGE> 45
LIMITED PARTNERS:
------------------------------------------
Southpac Trust International Inc., Trustee
of The Samuel Trust under agreement dated
January 26, 1995, by its authorized
signatory
------------------------------------------
Southpac Trust International Inc., Trustee
of The Joseph Trust under agreement dated
January 26, 1995, by its authorized
signatory
------------------------------------------
Helene B. Gralnick
3
<PAGE> 46
AMENDMENT NO. 2 TO
THE LIMITED PARTNERSHIP AGREEMENT OF
RODIN, LTD.
This Amendment No. 2 to the Limited Partnership Agreement of Rodin,
Ltd. (this "Amendment") is executed as of the 22nd day of December, 1995, by and
among Klee & Company, L.L.C., a Texas limited liability company (the "General
Partner"); Southpac Trust International Inc., as Trustee of The Samuel Trust
under agreement dated January 26, 1995, Southpac Trust International Inc., as
Trustee of The Joseph Trust under agreement dated January 26, 1995, and Helene
B. Gralnick (collectively the "Limited Partners"); and Marvin J. Gralnick (the
"Assignee") for the purpose of amending that certain Limited Partnership
Agreement of Rodin, Ltd. (the "Partnership") entered into as of December 21,
1995, by and between the General Partner and the Limited Partners (the
"Agreement"), as follows:
1. The Agreement is hereby amended to reflect the transfer as of
December 22, 1995, by Southpac Trust International Inc., as Trustee of The
Joseph Trust under agreement dated January 26, 1995, of a total of 22.216 Units
(as defined in the Agreement) held by the Limited Partner, Southpac Trust
International Inc., as Trustee of The Joseph Trust, to the Assignee. In order to
incorporate the above-described change in the interests of the Partners (as
defined in the Agreement) into the Agreement, the Agreement is hereby amended to
add the Assignee as a limited partner of the Partnership with respect to the
Units so transferred and to reflect that following such transfer the following
persons shall hold the units of each class indicated beside such person's name
below:
<PAGE> 47
<TABLE>
<CAPTION>
Name of Partner Units
--------------- -----
<S> <C> <C>
1. Klee & Company, L.L.C. 83.043
2. Southpac Trust International Inc., as 4,088.249
Trustee of The Samuel Trust under
agreement dated January 26, 1995
3. Southpac Trust International Inc., as 4,088.249
Trustee of The Joseph Trust under
agreement dated January 26, 1995
4. Helene B. Gralnick 22.216
5. Marvin J. Gralnick 22.216
=========
TOTAL 8,303.973
</TABLE>
All references in the Agreement to distributions and allocations among
the Limited Partners in accordance with and pro rata to their Units shall
henceforth be deemed to refer to an allocation based on the above-listed Units.
2. The General Partner and the Limited Partners consent in accordance
with Section 14.1 of the Agreement to the foregoing amendment to the Agreement
and consent in accordance with Section 11.6(A) of the Agreement to the Assignee
becoming a Substituted Limited Partner with respect to the Units so transferred.
IN WITNESS WHEREOF, this Amendment has been duly executed in one or
more counterparts (each of which is deemed to be an original for all purposes)
by the parties hereto.
2
<PAGE> 48
GENERAL PARTNER:
KLEE & COMPANY, L.L.C.
By:
--------------------------------
Helene B. Gralnick, Manager
LIMITED PARTNERS:
------------------------------------------
Southpac Trust International Inc., Trustee
of The Samuel Trust under agreement dated
January 26, 1995, by its authorized
signatory
------------------------------------------
Southpac Trust International Inc., Trustee
of The Joseph Trust under agreement dated
January 26, 1995, by its authorized
signatory
------------------------------------------
Helene B. Gralnick
------------------------------------------
Marvin J. Gralnick
3
<PAGE> 49
AMENDMENT NO. 3 TO
THE LIMITED PARTNERSHIP AGREEMENT OF
RODIN, LTD.
This Amendment No. 3 to the Limited Partnership Agreement of Rodin,
Ltd. (this "Amendment") is executed as of the 22nd day of December, 1995, by and
among Klee & Company, L.L.C., a Texas limited liability company (the "General
Partner"); Southpac Trust International Inc., as Trustee of The Samuel Trust
under agreement dated January 26, 1995, Southpac Trust International Inc., as
Trustee of The Joseph Trust under agreement dated January 26, 1995, Helene B.
Gralnick, and Marvin J. Gralnick (collectively the "Limited Partners"); and
Duncan E. Osborne, as Trustee of The Monty Vincent Gralnick Trust, Duncan E.
Osborne, as Trustee of The Milo Sigmond Gralnick Trust, Duncan E. Osborne, as
Trustee of The Etzani Sarah Gralnick Trust, and Duncan E. Osborne, as Trustee of
The Rio Damian Gralnick Trust (collectively, the "Assignees") for the purpose of
amending that certain Limited Partnership Agreement of Rodin, Ltd. (the
"Partnership") entered into as of December 21, 1995, by and between the General
Partner and the Limited Partners (the "Agreement"), as follows:
1. The Agreement is hereby amended to reflect the transfer as of
December 22, 1995, by Helene B. Gralnick of a total of 11.108 Units (as defined
in the Agreement) held by the Limited Partner, Helene B. Gralnick, to the
Assignees: 2.777 Units to Duncan E. Osborne, as Trustee of The Monty Vincent
Gralnick Trust, 2.777 Units to Duncan E. Osborne, as Trustee of The Milo Sigmond
Gralnick Trust, 2.777 Units to Duncan E. Osborne, as Trustee of The Etzani Sarah
Gralnick Trust, and 2.777 Units to Duncan E. Osborne, as Trustee of The Rio
Damian Gralnick Trust. In order to incorporate the above-described changes in
the interests of the Partners (as defined in the Agreement) into the Agreement,
the Agreement is
<PAGE> 50
hereby amended to add the Assignees as limited partners of the Partnership with
respect to the Units so transferred and to reflect that following such transfers
each of the following persons shall hold the units of each class indicated
beside such person's name below:
<TABLE>
<CAPTION>
Name of Partner Units
--------------- -----
<S> <C> <C>
1. Klee & Company, L.L.C. 83.043
2. Southpac Trust International Inc., as 4,088.249
Trustee of The Samuel Trust under
agreement dated January 26, 1995
3. Southpac Trust International Inc., as 4,088.249
Trustee of The Joseph Trust under
agreement dated January 26, 1995
4. Helene B. Gralnick 11.108
5. Marvin J. Gralnick 22.216
6. Duncan E. Osborne, as Trustee of The 2.777
Monty Vincent Gralnick Trust
7. Duncan E. Osborne, as Trustee of The 2.777
Milo Sigmond Gralnick Trust
8. Duncan E. Osborne, as Trustee of The 2.777
Etzani Sarah Gralnick Trust
9. Duncan E. Osborne, as Trustee of The 2.777
Rio Damian Gralnick Trust
=========
TOTAL 8,303.973
</TABLE>
All references in the Agreement to distributions and allocations among the
Limited Partners in accordance with and pro rata to their Units shall henceforth
be deemed to refer to an allocation based on the above-listed Units.
2
<PAGE> 51
2. The General Partners and the Limited Partners consent in accordance
with Section 14.1 of the Agreement to the foregoing amendment to the Agreement
and consent in accordance with Section 11.6(A) of the Agreement to the Assignees
becoming Substituted Limited Partners with respect to the Units so transferred.
IN WITNESS WHEREOF, this Amendment has been duly executed in one or
more counterparts (each of which is deemed to be an original for all purposes)
by the parties hereto.
GENERAL PARTNER:
KLEE & COMPANY, L.L.C.
By:
-----------------------------------------
Helene B. Gralnick, Manager
LIMITED PARTNERS:
--------------------------------------------
Southpac International Trust Inc., as
Trustee of The Samuel Trust under agreement
dated January 26, 1995, by its authorized
signatory
--------------------------------------------
Southpac International Trust Inc., as
Trustee of The Joseph Trust under agreement
dated January 26, 1995, by its authorized
signatory
3
<PAGE> 52
---------------------------------------------
Helene B. Gralnick
---------------------------------------------
Marvin J. Gralnick
---------------------------------------------
Duncan E. Osborne, as Trustee of The
Monty Vincent Gralnick Trust
---------------------------------------------
Duncan E. Osborne, as Trustee of The Milo
Sigmond Gralnick Trust
---------------------------------------------
Duncan E. Osborne, as Trustee of The
Etzani Sarah Gralnick Trust
---------------------------------------------
Duncan E. Osborne, as Trustee of The Rio
Damian Gralnick Trust
4
<PAGE> 53
AMENDMENT NO. 4 TO
THE LIMITED PARTNERSHIP AGREEMENT OF
RODIN, LTD.
This Amendment No. 4 to the Limited Partnership Agreement of Rodin,
Ltd. (this "Amendment") is executed as of the 22nd day of December, 1995, by and
among Klee & Company, L.L.C., a Texas limited liability company (the "General
Partner"); Southpac Trust International Inc., as Trustee of The Samuel Trust
under agreement dated January 26, 1995, Southpac Trust International Inc., as
Trustee of The Joseph Trust under agreement dated January 26, 1995, Marvin J.
Gralnick, Duncan E. Osborne, as Trustee of The Monty Vincent Gralnick Trust,
Duncan E. Osborne, as Trustee of The Milo Sigmond Gralnick Trust, Duncan E.
Osborne, as Trustee of The Etzani Sarah Gralnick Trust, and Duncan E. Osborne,
as Trustee of The Rio Damian Gralnick Trust (collectively the "Limited
Partners"); and Duncan E. Osborne, as Trustee of The Monty Vincent Gralnick
Trust, Duncan E. Osborne, as Trustee of The Milo Sigmond Gralnick Trust, Duncan
E. Osborne, as Trustee of The Etzani Sarah Gralnick Trust, and Duncan E.
Osborne, as Trustee of The Rio Damian Gralnick Trust, (collectively, the
"Assignees") for the purpose of amending that certain Limited Partnership
Agreement of Rodin, Ltd. (the "Partnership") entered into as of December 21,
1995, by and between the General Partner and the Limited Partners (the
"Agreement"), as follows:
1. The Agreement is hereby amended to reflect the transfer as of
December 22, 1995, by Marvin J. Gralnick of a total of 11.108 Units (as defined
in the Agreement) held by the Limited Partner, Marvin J. Gralnick, to the
Assignees: 2.777 Units to Duncan E. Osborne, as Trustee of The Monty Vincent
Gralnick Trust, 2.777 Units to Duncan E. Osborne, as Trustee of The Milo Sigmond
Gralnick Trust, 2.777 Units to Duncan E. Osborne, as Trustee of The Etzani Sarah
Gralnick Trust, and 2.777 Units to Duncan E. Osborne, as Trustee of The
<PAGE> 54
Rio Damian Gralnick Trust. In order to incorporate the above-described changes
in the interests of the Partners (as defined in the Agreement) into the
Agreement, the Agreement is hereby amended to add the Assignees as limited
partners of the Partnership with respect to the Units so transferred and to
reflect that following such transfers each of the following persons shall hold
the Units indicated beside such person's name below:
<TABLE>
<CAPTION>
Name of Partner Class A Units
--------------- -------------
<S> <C> <C>
1. Klee & Company, L.L.C. 83.043
2. Southpac Trust International Inc., as 4,088.249
Trustee of The Samuel Trust under
agreement dated January 26, 1995
3. Southpac Trust International Inc., as 4,088.249
Trustee of The Joseph Trust under
agreement dated January 26, 1995
4. Helene B. Gralnick 11.108
5. Marvin J. Gralnick 11.108
6. Duncan E. Osborne, as Trustee of The 5.554
Monty Vincent Gralnick Trust
7. Duncan E. Osborne, as Trustee of The 5.554
Milo Sigmond Gralnick Trust
8. Duncan E. Osborne, as Trustee of The 5.554
Etzani Sarah Gralnick Trust
9. Duncan E. Osborne, as Trustee of The 5.554
Rio Damian Gralnick Trust
=========
TOTAL 8,303.973
</TABLE>
2
<PAGE> 55
All references in the Agreement to distributions and allocations among the
Limited Partners in accordance with and pro rata to their Units shall henceforth
be deemed to refer to an allocation based on the above-listed Units.
2. The General Partners and the Limited Partners consent in accordance
with Section 14.1 of the Agreement to the foregoing amendment to the Agreement
and consent in accordance with Section 11.6(A) of the Agreement to the Assignees
becoming Substituted Limited Partners with respect to the Units so transferred.
IN WITNESS WHEREOF, this Amendment has been duly executed in one or
more counterparts (each of which is deemed to be an original for all purposes)
by the parties hereto.
GENERAL PARTNER:
KLEE & COMPANY, L.L.C.
By:
-----------------------------------------
Helene B. Gralnick, Manager
LIMITED PARTNERS:
--------------------------------------------
Southpac Trust International Inc., as
Trustee of The Samuel Trust under agreement
dated January 26, 1995, by its authorized
signatory
--------------------------------------------
Southpac Trust International Inc., as
Trustee of The Joseph Trust under agreement
dated January 26, 1995, by its authorized
signatory
3
<PAGE> 56
-----------------------------------------
Helene B. Gralnick
-----------------------------------------
Marvin J. Gralnick
-----------------------------------------
Duncan E. Osborne, as Trustee of The
Monty Vincent Gralnick Trust
-----------------------------------------
Duncan E. Osborne, as Trustee of The Milo
Sigmond Gralnick Trust
-----------------------------------------
Duncan E. Osborne, as Trustee of The
Etzani Sarah Gralnick Trust
-----------------------------------------
Duncan E. Osborne, as Trustee of The Rio
Damian Gralnick Trust
4
<PAGE> 57
AMENDMENT NO. 5 TO
THE LIMITED PARTNERSHIP AGREEMENT OF
RODIN, LTD.
This Amendment No. 5 to the Limited Partnership Agreement of Rodin,
Ltd. (this "Amendment") is executed as of the 2nd day of December, 1996, by and
among Klee & Company, L.L.C., a Texas limited liability company (the "General
Partner"); Southpac Trust International Inc., as Trustee of The Samuel Trust
under agreement dated January 26, 1995, Southpac Trust International Inc., as
Trustee of The Joseph Trust under agreement dated January 26, 1995, Marvin J.
Gralnick, Leslie C. Giordani, as Trustee of The Monty Vincent Gralnick Trust,
Leslie C. Giordani, as Trustee of The Milo Sigmond Gralnick Trust, Leslie C.
Giordani, as Trustee of The Etzani Sarah Gralnick Trust, and Leslie C. Giordani,
as Trustee of The Rio Damian Gralnick Trust (collectively the "Limited
Partners") for the purpose of amending that certain Limited Partnership
Agreement of Rodin, Ltd. (the "Partnership") entered into as of December 21,
1995, by and between the General Partner and the Limited Partners (the
"Agreement"), as follows:
1. The Agreement is hereby amended to reflect the change in trusteeship
as of July 1, 1996, of The Monty Vincent Gralnick Trust, The Milo Sigmond
Gralnick Trust, The Etzani Sarah Gralnick Trust, and The Rio Damian Gralnick
Trust (the "Trusts") from Duncan E. Osborne to Leslie C. Giordani. In order to
incorporate the above-described changes into the Agreement, the Agreement is
hereby amended to reflect that Leslie C. Giordani is now serving as Trustee of
the Trusts and to reflect that as of July 1, 1996, each of the following persons
shall hold the Units indicated beside such person's name below:
<PAGE> 58
<TABLE>
<CAPTION>
Name of Partner Class A Units
--------------- -------------
<S> <C> <C>
1. Klee & Company, L.L.C. 83.043
2. Southpac Trust International Inc., as 4,088.249
Trustee of The Samuel Trust under
agreement dated January 26, 1995
3. Southpac Trust International Inc., as 4,088.249
Trustee of The Joseph Trust under
agreement dated January 26, 1995
4. Helene B. Gralnick 11.108
5. Marvin J. Gralnick 11.108
6. Leslie C. Giordani, as Trustee of The 5.554
Monty Vincent Gralnick Trust
7. Leslie C. Giordani, as Trustee of The 5.554
Milo Sigmond Gralnick Trust
8. Leslie C. Giordani, as Trustee of The 5.554
Etzani Sarah Gralnick Trust
9. Leslie C. Giordani, as Trustee of The 5.554
Rio Damian Gralnick Trust
=========
TOTAL 8,303.973
</TABLE>
All references in the Agreement to distributions and allocations among the
Limited Partners in accordance with and pro rata to their Units shall henceforth
be deemed to refer to an allocation based on the above-listed Units.
2. The General Partners and the Limited Partners consent in accordance
with Section 14.1 of the Agreement to the foregoing amendment to the Agreement.
2
<PAGE> 59
IN WITNESS WHEREOF, this Amendment has been duly executed in one or
more counterparts (each of which is deemed to be an original for all purposes)
by the parties hereto.
GENERAL PARTNER:
KLEE & COMPANY, L.L.C.
By:
-----------------------------------------
Helene B. Gralnick, Manager
LIMITED PARTNERS:
--------------------------------------------
Southpac Trust International Inc., as
Trustee of The Samuel Trust under agreement
dated January 26, 1995, by its authorized
signatory
--------------------------------------------
Southpac Trust International Inc., as
Trustee of The Joseph Trust under agreement
dated January 26, 1995, by its authorized
signatory
3
<PAGE> 60
----------------------------------------------
Helene B. Gralnick
----------------------------------------------
Marvin J. Gralnick
----------------------------------------------
Leslie C. Giordani, as Trustee of The Monty
Vincent Gralnick Trust
----------------------------------------------
Leslie C. Giordani, as Trustee of The Milo
Sigmond Gralnick Trust
----------------------------------------------
Leslie C. Giordani, as Trustee of The Etzani
Sarah Gralnick Trust
----------------------------------------------
Leslie C. Giordani, as Trustee of The Rio
Damian Gralnick Trust
4
<PAGE> 61
AMENDMENT NO. 6 TO
THE LIMITED PARTNERSHIP AGREEMENT OF
RODIN, LTD.
This Amendment No. 6 to the Limited Partnership Agreement of Rodin,
Ltd. (this "Amendment") is executed effective as of the 2nd day of December,
1996, by and among Klee & Company, L.L.C., a Texas limited liability company
(the "General Partner"); Southpac Trust International Inc., as Trustee of The
Samuel Trust under agreement dated January 26, 1995, Southpac Trust
International Inc., as Trustee of The Joseph Trust under agreement dated January
26, 1995, Helene B. Gralnick, Marvin J. Gralnick, Leslie C. Giordani, as Trustee
of The Monty Vincent Gralnick Trust, Leslie C. Giordani, as Trustee of The Milo
Sigmond Gralnick Trust, Leslie C. Giordani, as Trustee of The Etzani Sarah
Gralnick Trust, and Leslie C. Giordani, as Trustee of The Rio Damian Gralnick
Trust (collectively the "Limited Partners"); and Leslie C. Giordani, as Trustee
of The Etzani Sarah Gralnick Trust (the "Assignee") for the purpose of amending
that certain Limited Partnership Agreement of Rodin, Ltd. (the "Partnership")
entered into as of December 21, 1995, by and between the General Partner and the
Limited Partners (the "Agreement"), as follows:
1. The Agreement is hereby amended to reflect the transfer as of
December 2, 1996, by Helene B. Gralnick of a total of 6.087 Units (as defined in
the Agreement) held by the Limited Partner, Helene B. Gralnick, to the Assignee,
and the transfer as of December 2, 1996, by Marvin J. Gralnick of a total of
6.087 Units (as defined in the Agreement) held by the Limited Partner, Marvin J.
Gralnick, to the Assignee. In order to incorporate the above-described changes
in the interests of the Partners (as defined in the Agreement) into the
Agreement, the Agreement is hereby amended to add the Assignee as a limited
partner of the Partnership with respect to the Units so transferred and to
reflect that following such transfers
<PAGE> 62
each of the following persons shall hold the units of each class indicated
beside such person's name below:
<TABLE>
<CAPTION>
Name of Partner Units
--------------- -----
<S> <C> <C>
1. Klee & Company, L.L.C. 83.043
2. Southpac Trust International Inc., as 4,088.249
Trustee of The Samuel Trust under
agreement dated January 26, 1995
3. Southpac Trust International Inc., as 4,088.249
Trustee of The Joseph Trust under
agreement dated January 26, 1995
4. Helene B. Gralnick 5.021
5. Marvin J. Gralnick 5.021
6. Leslie C. Giordani, as Trustee of The 5.554
Monty Vincent Gralnick Trust
7. Leslie C. Giordani, as Trustee of The 5.554
Milo Sigmond Gralnick Trust
8. Leslie C. Giordani, as Trustee of The 17.728
Etzani Sarah Gralnick Trust
9. Leslie C. Giordani, as Trustee of The 5.554
Rio Damian Gralnick Trust
=========
TOTAL 8,303.973
</TABLE>
All references in the Agreement to distributions and allocations among the
Limited Partners in accordance with and pro rata to their Units shall henceforth
be deemed to refer to an allocation based on the above-listed Units.
2
<PAGE> 63
2. The General Partners and the Limited Partners consent in accordance
with Section 14.1 of the Agreement to the foregoing amendment to the Agreement
and consent in accordance with Section 11.6(A) of the Agreement to the Assignee
becoming a Substituted Limited Partner with respect to the Units so transferred.
IN WITNESS WHEREOF, this Amendment has been duly executed in one or
more counterparts (each of which is deemed to be an original for all purposes)
by the parties hereto.
GENERAL PARTNER:
KLEE & COMPANY, L.L.C.
By:
----------------------------------------
Helene B. Gralnick, Manager
LIMITED PARTNERS:
-------------------------------------------
Southpac Trust International Inc., as
Trustee of The Samuel Trust under agreement
dated January 26, 1995, by its authorized
signatory
-------------------------------------------
Southpac Trust International Inc., as
Trustee of The Joseph Trust under agreement
dated January 26, 1995, by its authorized
signatory
3
<PAGE> 64
-------------------------------------------
Helene B. Gralnick
-------------------------------------------
Marvin J. Gralnick
-------------------------------------------
Leslie C. Giordani, as Trustee of The Monty
Vincent Gralnick Trust
-------------------------------------------
Leslie C. Giordani, as Trustee of The Milo
Sigmond Gralnick Trust
-------------------------------------------
Leslie C. Giordani, as Trustee of The Etzani
Sarah Gralnick Trust
-------------------------------------------
Leslie C. Giordani, as Trustee of The Rio
Damian Gralnick Trust
4
<PAGE> 65
AMENDMENT NO. 7 TO
THE LIMITED PARTNERSHIP AGREEMENT OF
RODIN, LTD.
This Amendment No. 7 to the Limited Partnership Agreement of Rodin,
Ltd. (this "Amendment") is executed effective as of the 7th day of October,
1997, by and among Klee & Company, L.L.C., a Texas limited liability company
(the "General Partner"), Southpac Trust International Inc., as Trustee of The
Samuel Trust, a trust established under agreement dated January 26, 1995, and as
Trustee of The Joseph Trust, a trust established under agreement dated January
26, 1995, Leslie C. Giordani, as Trustee of The Monty Vincent Gralnick Trust, as
Trustee of The Milo Sigmond Gralnick Trust, as Trustee of The Etzani Sarah
Gralnick Trust, and as Trustee of The Rio Damian Gralnick Trust and Helene B.
Gralnick and Marvin J. Gralnick (collectively the "Limited Partners"), and
Helene B. Gralnick ("H. Gralnick"), and Marvin J. Gralnick ("M. Gralnick")
(collectively the "Assignees") for the purpose of amending that certain Limited
Partnership Agreement of Rodin, Ltd. (the "Partnership") entered into as of
December 21, 1995, by and between the General Partner and the Limited Partners
thereunder (the "Agreement"), as follows:
1. The Agreement is hereby amended to reflect the transfer as of
October 7, 1997, by the Limited Partner of a total of 4,088.249 Units (as
defined in the Agreement) to M. Gralnick, and the transfer as of October 7,
1997, by the Limited Partner, Southpac Trust International Inc., as Trustee of
The Samuel Trust under agreement dated January 26, 1995, of a total of 4,088.249
Units to H. Gralnick. In order to incorporate the above-described changes in the
interests of the Partners (as defined in the Agreement) in the Agreement, the
Agreement is hereby amended to add the Assignees as limited partners of the
Partnership with respect to the Units so transferred
<PAGE> 66
and to reflect that following such transfers each of the following persons shall
hold the Units indicated beside such person's name below:
<TABLE>
<CAPTION>
Name of Partner Units
--------------- -----
<S> <C> <C>
1. Klee & Company, L.L.C. 83.043
2. Helene B. Gralnick 4,093.270
3. Marvin J. Gralnick 4,093.270
4. Leslie C. Giordani, as Trustee of The 5.554
Monty Vincent Gralnick Trust
5. Leslie C. Giordani, as Trustee of The 5.554
Milo Sigmond Gralnick Trust
6. Leslie C. Giordani, as Trustee of The 17.728
Etzani Sarah Gralnick Trust
7. Leslie C. Giordani, as Trustee of The 5.554
---------
Rio Damian Gralnick Trust
TOTAL 8,303.973
=========
</TABLE>
All references in the Agreement to distributions and allocations among the
Limited Partners in accordance with and pro rata to their Units shall henceforth
be deemed to refer to an allocation based on the above-listed Units.
2. The General Partner and the Limited Partners consent in accordance
with Section 14.1 of the Agreement to the foregoing amendment to the Agreement
and consent in accordance with Section 11.6(A) of the Agreement to the Assignees
becoming Substituted Limited Partners with respect to the Units so transferred.
2
<PAGE> 67
IN WITNESS WHEREOF, this Amendment has been duly executed in one or
more counterparts (each of which is deemed to be an original for all purposes)
by the parties hereto.
This Amendment may be executed in counterparts.
GENERAL PARTNER:
KLEE & COMPANY, L.L.C.
By:
-------------------------------------------
Helene B. Gralnick, Manager
LIMITED PARTNERS:
----------------------------------------------
Helene B. Gralnick
----------------------------------------------
Marvin J. Gralnick
----------------------------------------------
Leslie C. Giordani, as Trustee of The Monty
Vincent Gralnick Trust
----------------------------------------------
Leslie C. Giordani, as Trustee of The Milo
Sigmond Gralnick Trust
----------------------------------------------
Leslie C. Giordani, as Trustee of The Etzani
Sarah Gralnick Trust
----------------------------------------------
Leslie C. Giordani, as Trustee of The Rio
Damian Gralnick Trust
3
