<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )*
REPTRON ELECTRONICS, INC.
- --------------------------------------------------------------------------------
(NAME OF ISSUER)
$.001 PAR VALUE COMMON STOCK
- --------------------------------------------------------------------------------
(TITLE OF CLASS OF SECURITIES)
76026W109
- --------------------------------------------------------------------------------
(CUSIP NUMBER)
PAUL J. PLANTE
14401 McCORMICK DRIVE, TAMPA, FLORIDA 33626; (813) 854-2351
- --------------------------------------------------------------------------------
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON
AUTHORIZED TO RECEIVE NOTICES AND COMMUNICATIONS)
AUGUST 21, 1996
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(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(b)(3) or (4), check the following
box [ ].
Check the following box if a fee is being paid with the statement [ ].
(A fee is not required only if the reporting person: (1) has a previous
statement on file reporting beneficial ownership of more than five percent of
the class of securities described in Item 1: and (2) has filed no amendment
subsequent thereto reporting beneficial ownership of five percent or less of
such class.) (See Rule 13d-7.)
NOTE: Six copies of this statement, including all exhibits, should be
filed with the Commission. See Rule 13d-1(a) 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 on 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).
(continued on following pages)
(Page 1 of 8 Pages)
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<PAGE> 2
CUSIP No. 76026W109 SCHEDULE 13D Page 2 of 8 Pages
--------------------- -------- --------
(1) Names of Reporting Persons
S.S. or I.R.S. Identification Nos. of Above Persons
MICHAEL L. MUSTO
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(2) Check the Appropriate Box if a Member of a Group* (a) [ ]
(b) [ X ]
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(3) SEC Use Only
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(4) SOURCE OF FUNDS*
OO
---------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS
IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
---------------------------------------------------------------------
(6) Citizenship or Place of Organization
U.S.A.
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(7) Sole Voting Power
Number of 232,424 (1)
Shares --------------------------------------------------------
Beneficially (8) Shared Voting Power
Owned by 2,194,479 (2)
Each --------------------------------------------------------
Reporting (9) Sole Dispositive Power
Person With 232,424 (1)
--------------------------------------------------------
(10) Shared Dispositive Power
2,194,479 (2)
--------------------------------------------------------
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
2,426,903
---------------------------------------------------------------------
(12) Check Box if Aggregate Amount in Row (11) Excludes Certain
Shares* [ ]
---------------------------------------------------------------------
(13) Percent of Class Represented by Amount in Row (11)
40.0%
---------------------------------------------------------------------
(14) Type of Reporting Person*
IN
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*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.
(1) Shares distributable under the Reptron Electronics, Inc. Profit Sharing
Plan.
(2) Beneficial owner both, as president, director, and sole shareholder of MLM,
Inc. the managing general partner and individually as a limited partner
of MLM Investment Company Limited Partnership, the record owner.
<PAGE> 3
CUSIP No. 76026W109 SCHEDULE 13D Page 3 of 8 Pages
--------------------- -------- --------
(1) Names of Reporting Persons
S.S. or I.R.S. Identification Nos. of Above Persons
MLM, INC.
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(2) Check the Appropriate Box if a Member of a Group* (a) [ ]
(b) [ X ]
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(3) SEC Use Only
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(4) SOURCE OF FUNDS*
OO
---------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS
IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
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(6) Citizenship or Place of Organization
NEVADA, U.S.A.
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(7) Sole Voting Power
Number of -0-
Shares --------------------------------------------------------
Beneficially (8) Shared Voting Power
Owned by 2,194,479 (1)
Each --------------------------------------------------------
Reporting (9) Sole Dispositive Power
Person With -0-
--------------------------------------------------------
(10) Shared Dispositive Power
2,194,479 (1)
--------------------------------------------------------
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
2,194,479
---------------------------------------------------------------------
(12) Check Box if Aggregate Amount in Row (11) Excludes Certain
Shares* [ ]
---------------------------------------------------------------------
(13) Percent of Class Represented by Amount in Row (11)
36.2%
---------------------------------------------------------------------
(14) Type of Reporting Person*
CO
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*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.
(1) MLM, Inc. is reporting this beneficial ownership as the managing general
partner of MLM Investment Company Limited Partnership, the record owner
of the shares.
<PAGE> 4
CUSIP No. 76026W109 SCHEDULE 13D Page 4 of 8 Pages
--------------------- -------- --------
(1) Names of Reporting Persons
S.S. or I.R.S. Identification Nos. of Above Persons
MICHAEL L. MUSTO, TRUSTEE, UNDER THE MICHAEL L. MUSTO
REVOCABLE LIVING TRUST
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(2) Check the Appropriate Box if a Member of a Group* (a) [ ]
(b) [ ]
---------------------------------------------------------------------
(3) SEC Use Only
---------------------------------------------------------------------
(4) SOURCE OF FUNDS*
OO
---------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS
IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
---------------------------------------------------------------------
(6) Citizenship or Place of Organization
U.S.A.
---------------------------------------------------------------------
(7) Sole Voting Power
Number of -0-
Shares --------------------------------------------------------
Beneficially (8) Shared Voting Power
Owned by -0-
Each --------------------------------------------------------
Reporting (9) Sole Dispositive Power
Person With -0-
--------------------------------------------------------
(10) Shared Dispositive Power
1,809,312 (1)
--------------------------------------------------------
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
1,809,312
---------------------------------------------------------------------
(12) Check Box if Aggregate Amount in Row (11) Excludes Certain
Shares* [ ]
---------------------------------------------------------------------
(13) Percent of Class Represented by Amount in Row (11)
30.0%
---------------------------------------------------------------------
(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.
(1) Michael L. Musto, Trustee, under the Michael L. Musto Revocable Living
Trust is reporting this beneficial ownership as a limited partner of MLM
Investment Company Limited Partnership, the record owner of the shares.
<PAGE> 5
Item 1 Security and Issuer
Title of Securities: Common Stock, par value $.001 per
share (the "Stock") of Reptron
Electronics, Inc. (the "Issuer")
Name and Address of Issuer: Reptron Electronics, Inc.
14401 McCormick Drive
Tampa, Florida 33626
ITEM 2 IDENTITY AND BACKGROUND
Item 2(a) This Statement is being filed by and on behalf of
Michael L. Musto ("Musto"), MLM, Inc., a Nevada
corporation ("MLM"), as general partner of MLM
Investment Company Limited Partnership, a Nevada
limited partnership ("MLM Ltd"), and Michael L.
Musto, Trustee, under the Michael L. Musto Revocable
Living Trust ("MLM Trust") (each may also be referred
to as the "Reporting Person"). Musto is the sole
officer, director, and shareholder of MLM.
Item 2(b) The business address for Musto and MLM Trust is:
14401 McCormick Drive
Tampa, FL 33626
The business address for MLM is:
c/o Beckley Singleton DeLanoy
530 Las Vegas Blvd., S.
Las Vegas, Nevada 89101
Item 2(c) The principal occupation or business of each
Reporting Person is as follows:
Musto President and Chief Executive
Officer of Reptron Electronics, Inc.
14401 McCormick Drive
Tampa, FL 33626
MLM Managing General Partner of MLM Ltd:
c/o Beckley Singleton DeLanoy
530 Las Vegas Blvd., S.
Las Vegas, Nevada 89101
MLM Trust Investor
14401 McCormick Drive
Tampa, Florida 33626
Item 2(d) Criminal Proceedings: None.
Item 2(e) Civil Proceedings: None.
Item 2(f) The natural person listed in Item 2(a) above is a
United States citizen.
Page 5 of 8 Pages
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ITEM 3 SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
On August 21, 1996, beneficial ownership of the securities reported
hereunder was acquired by each of MLM, as managing general partner of MLM Ltd.
and Musto, as sole director, officer, and shareholder of MLM and as trustee of
MLM Trust (a limited partner of MLM Ltd.). Of the 2,194,479 shares of Stock
acquired by MLM Ltd., 1,809,312 of the shares were originally owned by MLM
Trust and 385,167 of the shares were originally owned by Michael L. Musto
Grantor Retained Annuity Trust ("GRAT"). The shares owned by MLM Trust and
GRAT were acquired prior to the Issuers initial public offering.
ITEM 4 PURPOSE OF TRANSACTION
The shares of Stock were transferred by MLM Trust and GRAT to MLM Ltd
solely for tax planning purposes. See item 3 above.
ITEM 5 INTEREST IN SECURITIES OF THE ISSUER
Item 5(a) See Items 11 and 13 of the applicable cover page
Item 5(b) See Items 7, 8, 9, and 10 of the applicable cover
page.
Item 5(c) The following table sets forth all transactions with
respect to the Issuer's Stock effected during the
past sixty days by any Reporting Person. Each
transaction set forth below reflects a purchase (P)
or a sale (S) effected by means of an
over-the-counter trade.
<TABLE>
<CAPTION>
Reporting Person Trade Date No. of Shares Price Per Share
---------------- ---------- ------------- ---------------
<S> <C> <C> <C>
Musto 12/10/96 60,580 (S) $20.00
</TABLE>
Item 5(d) Michael L. Musto, as sole director, officer, and
shareholder of MLM, the general partner of MLM Ltd.,
has the right to receive and to direct the receipt of
dividends from and proceeds from the sale of the
shares indicated in Item 11 of the applicable cover
page. Mr. Musto has the right to receive proceeds
from the sale of the shares indicated in Item 11 of
the applicable cover page as trustee of the Michael
L. Musto Revocable Living Trust, a limited partner of
MLM Ltd. Mr. Musto, individually, also has the right
to receive dividends and proceeds from the sale of
less than five percent of the class of stock as a
limited partner of MLM Ltd., and the shares indicated
in Item 7 and 9 of the appliable cover page.
Item 5(e) Not applicable.
Page 6 of 8 Pages
<PAGE> 7
ITEM 6 CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
See Items 3 and 5 above for a description of the MLM Investment Company
Limited Partnership Agreement among MLM (as managing general partner),
Michael L.Musto, Trustee, under the MLM Trust (as non-managing general
partner), and Michael L. Musto, Trustee, under the Michael L. Musto
Grantor Retained Annuity Trust dated January 13, 1994 (as limited
partner) and Michael L. Musto, Trustee, under the MLM Trust (as limited
partner).
ITEM 7 MATERIALS TO BE FILED AS EXHIBITS
EXHIBIT 1 MLM INVESTMENT COMPANY LIMITED PARTNERSHIP
AGREEMENT
EXHIBIT 2 JOINT FILING AGREEMENT
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: February 13, 1997.
/s/ Micheal L. Musto
--------------------------------------
Michael L. Musto
MLM, INC.
By: /s/ Michael L. Musto
-----------------------------------
Michael L. Musto, President
Michael L. Musto Revocable Living Trust
By: /s/ Micheal L. Musto
-----------------------------------
Michael L. Musto, Trustee
The original statement shall be signed by each person on whose behalf
the statement is filed or his authorized representative. If the statement is
signed on behalf of a person by his authorized representative (other than an
executive officer or general partner of this filing person), evidence of the
representative's authority to sign on behalf of such person shall be filed with
the statement, provided, however, that a power of attorney for this purpose
which is already on file with the Commission may be
Page 7 of 8 Pages
<PAGE> 8
incorporated by reference. The name and any title of each person who signs the
statement shall be typed or printed beneath his signature.
ATTENTION: INTENTIONAL MISSTATEMENTS OR OMISSIONS OF FACT CONSTITUTE
FEDERAL CRIMINAL VIOLATIONS (SEE 18 U.S.C. 1001).
Page 8 of 8 Pages
<PAGE> 9
EXHIBIT 1
MLM INVESTMENT COMPANY LIMITED PARTNERSHIP AGREEMENT
This Limited Partnership Agreement ("Agreement") is entered into,
pursuant to the provisions of the Nevada Uniform Limited Partnership Act, and
shall be effective as of the date of filing of the Certificate of Limited
Partnership with the Nevada Secretary of State, by and among MLM, Inc., a
Nevada corporation (as the "Managing General Partner"), Michael L. Musto,
Trustee, under the Michael L. Musto Revocable Living Trust Agreement, as
amended through July 27, 1994, and as thereafter amended from time to time (the
"Revocable Trust") (as the "non-managing General Partner"), and Michael L.
Musto, Trustee, under the Michael L. Musto Grantor Retained Annuity Trust dated
January 13, 1994 (the "R.A. Trust") (as a "Limited Partner"), and Michael L.
Musto, Trustee of the Revocable Trust (as a "Limited Partner"), on the
following terms and conditions:
ARTICLE I
FORM AND INTERPRETATION
1. Definitions. The following capitalized terms, as used in this
Agreement and in the attached exhibits, which constitute a part of this
Agreement, have the meanings ascribed to them below and include the plural as
well as the singular number:
"Act" means the Nevada Uniform Limited Partnership Act, as amended, or
any subsequent Nevada law concerning partnerships that are enacted in
substitution for the Act.
"Affiliate" of a Partner means (1) another Partner of the Partnership;
(2) a legal or personal representative of any Partner; (3) the Partner's lineal
descendants and spouse (other than a spouse who is legally separated from the
Partner under a decree of divorce or separate maintenance); (4) a trustee of a
trust for the benefit of any Person referred to in clause (1), (2) or (3); (5)
a Person, other than an individual, of which 80% or more of the voting or
equity interests is owned directly or indirectly by a Partner and/or one or
more of the Persons referred to in clauses (1) through (4); (6) a Person owning
80% or more of the voting or equity interests of a Partner that is not an
individual; or (7) a Person other than an individual, 80% or more of the voting
or equity interests of which is owned by the same Person that owns 80% or more
of the voting or equity interests of a Partner that is not an individual.
"Agreement" means this Limited Partnership Agreement as originally
executed and as subsequently amended or supplemented from time to time in
accordance with section 55.
"Assignment" means a sale, exchange, gift, pledge, transfer or
disposition of any kind whatsoever and, in the case of a Person that is not an
individual, it includes the sale, exchange, pledge, transfer or disposition of
a majority of either voting control or
<PAGE> 10
the equity interests in such Person.
"Bankruptcy" means taking advantage of any bankruptcy or insolvency
act (including the Bankruptcy Reform Act of 1978 or similar law, and also any
proceeding under state or local insolvency or debtor relief laws), or a final
adjudication of insolvency or an assignment of a major portion of a Person's
assets for the benefit of creditors.
"Capital Account" has the meaning set forth in section 12.
"Capital Contribution" means the total amount of cash, and net fair
market value of securities and other property contributed by a Partner to the
equity of the Partnership, or agreed to be contributed by a Partner to the
equity of the Partnership, pursuant to section 11(a), and reduced by any return
of capital to the Partner within the meaning of section 11(c). Any reference
in this Agreement to the Capital Contribution of either a Partner or an
assignee of a Partner shall include the Capital Contribution of any prior
Partner to whose Partnership Interest the then existing Partner or assignee
succeeded.
"Cash Flow" means the excess of cash derived by the Partnership from
all sources, including from capital contributions, loans, sales of securities
and other activities, (but excluding cash derived from the winding-up and
liquidation of the Partnership pursuant to section 37) over the sum of all cash
disbursements, including repayments of loans from Partners, loans to Partners
for the Partnership, and distributions to Partners pursuant to section 16(a) or
(b) (but excluding disbursements pursuant to section 16(c), plus a reasonable
allowance for reserves for repairs, investments in Property (including
Marketable Securities), replacements, contingencies and anticipated obligations
(including debt service, capital improvements and replacements to the extent
not funded by reserves) as reasonably determined by the Managing General
Partner. Notwithstanding the preceding sentence, in determining the reasonable
allowance for reserves, the Managing General Partner shall reduce such
allowance to the extent necessary to ensure that annual distributions of Cash
Flow to each Partner will be in an amount at least equal to the annual income
tax liability (exclusive of income tax liability resulting from a transaction
pursuant to section 16(b) or (c)) of each such Partner (determined assuming
that the maximum possible income tax rate is applicable) resulting from the
allocation to the Partner of his share of the Partnership's Taxable Income and
Taxable Loss. If the Partners elect, pursuant to Section 761 of the Code, for
the Partnership not to be subject to Subchapter K of Chapter 1, then Cash Flow
shall be calculated separately for each Partner on the theory that each Partner
owns the assets of the Partnership directly. For this purpose, if a Partner
has contributed Marketable Securities to the Partnership, such Marketable
Securities (including stock dividends thereon, stock splits or other
recapitalizations) shall be allocated to the contributing Partner (or such
Partner's assigns).
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<PAGE> 11
"Code" means the Internal Revenue Code of 1986, as amended, or any
subsequent federal law concerning income taxes that is enacted in substitution
for the Code.
"General Partner" means any Person admitted as a general partner in
accordance with this Agreement.
"General Partnership Interest" means the Partnership Interest of a
General Partner, in his capacity as a General Partner.
"Limited Partner" means any Person admitted as a limited partner in
accordance with this Agreement.
"Limited Partnership Interest" means the Partnership Interest of a
Limited Partner, in his capacity as a Limited Partner.
"Majority in Interest" when used in regard to the degree of consent,
approval or agreement required among the Partners, means Partners whose
aggregate Capital Account balances constitute over 50% of the total aggregate
Capital Account balances of all owners of Partnership Interests then
outstanding.
"Managing General Partner" means the Person designated in this
Agreement as the general partner responsible for management of the affairs of
the Partnership, including all voting rights with respect to, and control over,
Marketable Securities, and thereafter any Person which becomes a general
partner responsible for management of the affairs of the Partnership pursuant
to this Agreement, in the Person's capacity as a managing general partner of
the Partnership. Initially, the Managing General Partner shall be MLM, Inc.
"Marketable Securities" means securities, including stock, which are
traded on an established securities market, whether or not registered under the
Securities Act of 1933. The term includes the shares of Reptron Electronics,
Inc. and any successor thereto.
"Partner" means each Person which is a General Partner or a Limited
Partner.
"Partnership" means the MLM INVESTMENT COMPANY LIMITED PARTNERSHIP,
the limited partnership formed in accordance with the Act pursuant to this
Agreement.
"Partnership Interest" includes only a Partner's Capital Contribution
and right to receive his Percentage Interest and excludes Partnership Rights.
"Partnership Rights" excludes the Partnership Interest of a Partner,
and includes, in addition to other rights provided in this Agreement, the
rights provided to
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<PAGE> 12
him by the Act except to the extent such rights are inconsistent with the
provisions of this Agreement.
"Percentage Interest" means a Partner's percentage share (as initially
stated opposite such Partner's name on Exhibit A as amended from time to time),
of the Profits and Losses, Taxable Income or Taxable Loss, cash and other
distributions and liquidation proceeds of the Partnership all subject to and
interpreted in accordance with the terms of this Agreement. The Percentage
Interests of Partners shall be proportionate to the Capital Accounts of the
Partnership at all times so that, for example, if a Partner's Capital Account
is 100 and the aggregate of all Capital Accounts is 1000, the Partner's
Percentage Interest in the Partnership is 10%. In the event of a change among
the Partners in the Percentage Interests in the Partnership during the year,
the Partnership shall use a closing-of-the-books method with respect to such
change or changes in Percentage Interests in computing a Partner's share of
Profits and Losses, Taxable Income and Taxable Losses, and entitlement to
distributions during such year.
"Person" means any individual and any general or limited partnership,
corporation, estate, joint venture, trust, business trust, cooperative,
association or other organization.
"Profits and Losses" means the annual net income or loss of the
Partnership determined on a generally accepted accounting principles basis, as
disclosed on the annual financial statements of the Partnership. If the
Partners have elected for the Partnership to be excluded from the application
of Subchapter K of Chapter 1 of the Code, the provisions relating to Profits
and Losses shall be of no effect during such period at the Partnership level,
but will be separately computed for each Partner.
"Property" means any real, personal, tangible or intangible property
contributed by a Partner to the equity of the Partnership or otherwise acquired
by the Partnership.
"Pro Rata" means in the proportion that the Percentage Interest of
each Partner bears to the total Percentage Interests of all the Partners.
"Retirement" means the death, Bankruptcy, adjudication of incompetency
as determined by a court of appropriate jurisdiction, dissolution and
liquidation or termination of existence, merger or consolidation (except as
provided in section 33) of a Partner, or the sale, lease or other disposition
of all or substantially all the property of a Partner (except as provided in
section 33).
"Taxable Income or Taxable Loss" means the net income or loss of the
Partnership for federal income tax purposes, as determined at the close of the
Partnership's fiscal year by the accountants employed by the Partnership to
prepare its income tax returns. If the Partners have elected for the
Partnership to be excluded
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<PAGE> 13
from the application of Subchapter K of Chapter 1 of the Code, the provision
shall be of no effect for federal income tax purposes during such period, but
will be separately computed for each Partner.
2. Captions and Certain Terms. The titles and captions preceding
the text of the articles and sections of this Agreement are solely for
convenience of reference and neither constitute a part of this Agreement nor
affect its meaning, interpretation, or effect. The words "hereby," "herein,"
"hereof," "hereto," "hereunder," and terms of similar import refer to this
Agreement as a whole and not to any particular article, section, subsection or
other part of this Agreement.
3. Severability. If any article, section or other provision of
this Agreement, or its application, is held to be invalid, illegal or
unenforceable in any respect or for any reason, the remainder of this Agreement
and the application of such article, section or other provision to a person or
circumstance with respect to which it is valid, legal and enforceable is not
affected.
4. Limitation of Grant. Nothing in this Agreement, whether
express or implied, is intended or may be construed to confer upon, or to grant
to, any creditor or any other Person (other than the Partners and their legal
and personal representatives, heirs, successors and permitted assignees) any
right, remedy or claim under or because of this Agreement or any covenant,
condition or stipulation of it.
ARTICLE II
ORGANIZATION OF PARTNERSHIP
5. A. Formation, Name, Office and Registered Agent. The
Partnership is organized as of the effective date of this Agreement and the
signatories to this Agreement constitute the members of this Partnership under
the Act as of such date. The rights and obligations of the Partners are
determined by the Act, except as otherwise expressly provided in this
Agreement. The name of the Partnership is "MLM INVESTMENT COMPANY LIMITED
PARTNERSHIP." The recordkeeping office of the Partnership is located at c/o
Beckley, Singleton, DeLanoy, Jemison & List, Chtd., 530 Las Vegas Boulevard
South, Las Vegas, Nevada 89101-6515. The principal business office of the
Partnership is located at c/o Beckley, Singleton, DeLanoy, Jemison & List,
Chtd., 530 Las Vegas Boulevard South, Las Vegas, Nevada 89101-6515. The
Managing General Partner may change the name of the Partnership or the location
of its principal business office at any time and from time to time by giving
written notice of such change to each Partner. The registered agent and
registered office of the Partnership is Beckley, Singleton, DeLanoy, Jemison &
List, Chtd., 530 Las Vegas Boulevard South, Las Vegas, Nevada 89101-6515.
-5-
<PAGE> 14
B. General and Limited Partners. MLM, Inc. and Michael
L. Musto, Trustee under the Revocable Trust are the initial Managing General
Partner and non-managing General Partner, respectively, of the Partnership.
Michael L. Musto, Trustee of the R.A. Trust and Michael L. Musto, Trustee of
the Revocable Trust, are the initial Limited Partners of the Partnership.
C. Certificate of Limited Partnership. In connection
with the execution of this Agreement, the Managing General Partner and
non-managing General Partner shall sign a certificate of limited partnership,
pursuant to the Act. The Managing General Partner shall cause the certificate
to be filed with the Nevada Secretary of State. The Managing General Partner
shall amend the certificate when required under this Agreement and shall
execute the amended certificate as required by the Act.
6. Purpose of Partnership.
(a) Except as provided in 6(c) below, the
purposes of the Partnership are to:
(i) invest in, own, sell, acquire,
manage and exercise the voting
rights associated with Marketable
Securities, including securities
issued by Reptron Electronics, Inc.,
(ii) after approval by a Majority in
Interest, acquire, hold, sell, own,
improve, develop or lease other
types of property in addition to
Marketable Securities, and
(iii) engage in any other lawful activity
for profit approved by an
affirmative vote of a Majority in
Interest.
(b) Notwithstanding Section 6(a), unless
unanimously approved by the Partners, the
Partnership shall not engage in any
activity(ies) which would result, based
upon opinion of tax counsel, in the
characterization of the Partnership as an
investment company as that term is used in
Section 721(b) or any successor provision of
the Code.
(c) Subsequent to the date of commencement of
existence of the Partnership, the Partners
may make the election set forth in Treas.
Reg. Section 1.761-2 to have the Partnership
excluded from the application of Subchapter K
of Chapter 1 of the Code until such time as a
Majority in Interest determine to have the
Partnership engage in an activity other than
-6-
<PAGE> 15
investing in Reptron Electronics, Inc. Until
such time as the Partnership engages in other
than investment activities, and if the
aforementioned election is made, it is the
intention of the Partners that the
Partnership shall be only for investment
purposes and shall not actively conduct
business. It is the intention of the
Partners that the Partnership shall have
legal title to, and ownership of, Marketable
Securities, so as to effectuate the
co-ownership of the Marketable Securities by
the Partners. As is evidenced by various
provisions of this Agreement, each Partner
reserves the right separately to take or
dispose of their shares or interests in the
Marketable Securities. Further, during the
period Subchapter K does not apply to the
Partnership, this Agreement is to be
interpreted in a manner that will give effect
to such election.
7. Term of Partnership. The term of the Partnership shall
continue until the earlier of (i) December 31, 2037, or (ii) the death or
adjudication of incompetency as determined by a court of appropriate
jurisdiction of Michael L. Musto, unless the Partnership is earlier dissolved
and terminated under this Agreement.
8. Authorized Acts. In furtherance of its purposes, but subject
to every other provision of this Agreement, the Partnership, through, and only
through, the actions of the Managing General Partner acting alone, is
authorized to do the following:
(a) acquire by purchase, lease or otherwise, any
real or personal, tangible or intangible property that may be necessary,
convenient or incidental to the accomplishment of the purposes of the
Partnership;
(b) construct, operate, maintain, finance,
improve, own, sell, convey, exchange, assign, mortgage or lease any property
(or a part thereof) as may be necessary, convenient or incidental to the
accomplishment of the purposes of the Partnership;
(c) borrow money and issue evidences of
indebtedness in furtherance of any purpose of the Partnership and secure the
same by a mortgage, pledge, security interest or other liens on the property,
any part thereof, any interest therein or on any improvements thereto;
(d) prepay, in whole or in part, refinance,
increase, renew, modify or extend any indebtedness of the Partnership and, in
connection therewith, extend, renew or modify any mortgage, pledge, security
interest or other lien affecting any property;
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(e) invest and reinvest the assets of the
Partnership in, and purchase, acquire, hold, sell, transfer and exchange
securities of all kinds, including Marketable Securities;
(f) lend money to Partners;
(g) exercise the voting rights associated with
property owned by the Partnership; and
(h) enter into any activity and perform and carry
out any contract in connection with, or necessary or incidental to, the
accomplishment of the purposes of the Partnership.
9. Co-Ownership of Partnership Interests. Any consent required
by a Partner shall require the action or vote of each Person (or in such other
manner as such Persons have designated in writing to the Partnership) having an
interest in such Partnership Interest, with a majority approval needed for
consent. On the death of a co-owner of a Partnership Interest held in either
joint tenancy with right of survivorship or tenancy by the entirety, the
Partnership Interest is owned solely by the survivor as a Partner, and not as
an assignee. The Partnership need not (although it may) recognize the death of
a co-owner of a Partnership Interest until the Managing General Partner
receives notice of the death. A co-owner of a Partnership Interest may sever
the tenancy by giving to the Managing General Partner notice to that effect,
and signed by the co-owner requesting the severance in the case of a joint
tenancy, and by both co- owners in the case of a tenancy by the entirety. Upon
receipt of the notice and the certificate evidencing the Partnership Interest
owned by the co-owners, the Managing General Partner shall cause the
Partnership Interest to be allocated as directed by the co-owners and shall
indicate on the Partnership records such allocation. In absence of joint
direction, the interests shall be allocated between the owners as the severed
ownership interests would be valued for federal estate tax purposes.
10. Representations and Warranties of the Limited Partners. As a
condition to becoming a Limited Partner of the Partnership, each Limited
Partner represents, warrants, and covenants to the General Partner and the
Partnership as follows:
(a) He will not assign, sell, mortgage, pledge,
or otherwise transfer or encumber any of his rights under this Agreement except
as expressly permitted under this Agreement and applicable laws;
(b) He was granted full and unrestricted access
to the Partnership's business premises, offices and properties and its
business, partnership and financial books and records as he required, and was
permitted to examine the foregoing, to question the General Partner, and to
make all other investigations that he considered appropriate to determine or
verify the business or condition (financial or
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otherwise) of the Partnership and to consummate the transactions contemplated
by this Agreement;
(c) The Partnership furnished him all additional
information concerning the Partnership's business and affairs that he
requested;
(d) He was permitted to ask questions of, and to
receive answers from, the General Partner concerning the terms and conditions
of an investment in a Limited Partnership Interest, and to obtain all
additional information he considered necessary to verify the accuracy of the
information received by him from the General Partner, and he understands the
risks associated with an investment in the Partnership and that such an
investment is highly speculative;
(e) Because of his considerable knowledge and
experience in financial and business matters in general and securities
investments in particular, he is able to evaluate the merits, risks, and other
factors bearing on the suitability of a Limited Partnership Interest as an
investment;
(f) His income and net worth are such that he is
not now, and does not contemplate being, required to dispose of any investment
in the Partnership to satisfy any existing or expected obligation, and he is
otherwise fully able to bear the economic risks of his proposed investment in
the Partnership, including the risk of losing all or any part of his investment
in the Partnership and the probable inability to sell, transfer, or pledge, or
otherwise dispose of an investment in the Partnership for an indefinite period;
(g) He is acquiring a Limited Partnership
Interest solely for his own account, as principal, for investment purposes and
not with a view to or for resale in connection with any distribution or
underwriting of any Partnership Interests;
(h) He understands that the Limited Partnership
Interest that he will purchase has not been and will not be registered under
either the Securities Act of 1933 or any state securities law, that he must
hold the Limited Partnership Interest indefinitely unless the Partnership
Interests are subsequently registered under those laws or transferred in
reliance on advice of counsel satisfactory to the Partnership that registration
under those laws is not required, and that stop-transfer instructions will be
noted in the appropriate records of the Partnership;
(i) He understands that the document evidencing a
Limited Partnership Interest acquired by him will bear the following legend:
These securities have not been registered under either the
Securities Act of 1933 or any state securities law and were
acquired pursuant to an investment representation by the
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record owner. These securities are not transferable absent
either registration under the Act and every applicable state
securities law or advice of counsel satisfactory to the
Partnership that registration in not required. Additionally,
these securities are subject to certain transfer restrictions
set forth in the Limited Partnership Agreement of the
Partnership. Reference may be made to the Limited Partnership
Agreement for the details of those restrictions.
(j) He understands that a legend substantially
identical to the one described above will be placed on every new document
issued upon a transfer of a Limited Partnership Interest;
(k) He shall not sell, transfer, pledge, or
otherwise dispose of any part of his Limited Partnership Interest, unless the
Partnership Interests are registered under the Securities Act of 1933 and under
every applicable state securities law or unless the Partnership is furnished
with advice of counsel satisfactory to it that registration under those laws is
not required; and
(l) He understands that the Partnership does not
file periodic reports with the Securities and Exchange Commission pursuant to
the Securities Exchange Act of 1934.
ARTICLE III
PARTNERSHIP CAPITAL
11. Capital Contributions.
(a) Upon executing this Agreement, each Partner
shall make or has made a Capital Contribution in the amount and of the type,
and initially shall have a Percentage Interest equal to the percentage, set
forth opposite his name on EXHIBIT A. Partners may make (but Limited Partners
are not required to make) additional Capital Contributions at such time and in
such amount as they in their sole discretion shall determine but only if the
Managing General Partner and a Majority in Interest consent to such additional
Capital Contributions. Upon the assignment of any Partnership Interest, the
making of an additional Capital Contribution or any return of a Capital
Contribution, or any substitution of a Partner, EXHIBIT A shall be amended to
accurately reflect the name, address, Capital Contribution and Percentage
Interest of each Partner.
(b) Notwithstanding (a) above, no Capital
Contributions shall be made or permitted by any Partner which would result,
directly or indirectly, in the
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Partnership being treated as an investment company under section 721(b) of the
Code, and any such attempted Capital Contribution shall be void ab initio. The
Managing General Partner shall withhold its consent to the making of an
additional Capital Contribution, unless it has satisfied itself (by seeking
advice of legal counsel or otherwise) that the making of the additional Capital
Contribution will not result, directly or indirectly, in the Partnership being
treated as an investment company under section 721(b) of the Code.
(c) A Partner shall not receive from the Managing
General Partner or out of Partnership Property, and the Managing General
Partner and the Partnership shall not return to a Partner, any part of his
Capital Contribution, except as set forth in Articles V, VIII and IX of this
Agreement and such distribution is determined to be a return of a Partner's
Capital Contribution, and then only if all liabilities of the Partnership,
except liabilities to the Partners on account of their Capital Contributions,
have been paid or there remains property of the Partnership sufficient to pay
them. The Partnership shall not pay interest on Capital Contributions, and, a
Partner may demand and receive only cash in return for his Capital
Contribution, except to the extent provided for in Articles V and IX of this
Agreement or unless the Liquidator (as defined in section 37) decides to
distribute Partnership property in kind upon the dissolution, winding-up, and
termination of the Partnership, or unless the distribution of property to a
Partner is unanimously approved by the Partners. Each Partner, by signing this
Agreement or a counterpart of it, consents to all distributions authorized by
this Agreement and releases all other Partners from all liability to both him
and the Partnership for all distributions made in accordance with this
Agreement.
12. Capital Account.
(a) The Managing General Partner shall establish
and maintain a Capital Account for each Partner in the Partnership's books of
account. Capital Accounts shall be maintained and adjusted in accordance with
generally accepted accounting principles. A Limited Partner shall not e
obligated to restore a deficit balance in its Capital Account, except to the
extent required by the Act. Consistent with these capital account maintenance
rules, the Managing General Partner shall credit to each Partner's Capital
Account the amounts of the Partner's Capital Contributions and any Profits
allocated to the Partner. The Managing General Partner shall charge to or
deduct from each Partner's Capital Account the amounts of all distributions (in
cash or other property) or the Partner and any Losses allocated to the Partner.
If any interest in the Partnership is transferred in accordance with the terms
of this Agreement, the transferee shall succeed to the Capital Account of the
transferror to the extent it relates to the transferred interest.
(b) The provisions of this section and the other
provisions of this Agreement pertaining to the maintenance of Capital Accounts
are intended to comply
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with Treasury Regulation Section 1.704-1(b) (or any successor provision
thereto), and shall be interpreted and applied in a manner consistent with such
Regulations. In the event that Managing General Partner determines that it is
prudent to modify the manner in which the Capital Accounts are computed in
order to comply with such Regulations, provided that it is not likely to have a
material effect on the amounts distributable to any Partner without such
Partner's consent and upon receipt of an opinion of tax counsel to the
Partnership concluding that such modification will be given effect for federal
income tax purposes, the Managing General Partner may make such modification.
(c) The Managing General Partner shall revalue
the Partnership's Property (based on its fair market value as of the moment
immediately preceding the relevant event) and shall adjust Capital Accounts to
take into account any resulting Profit or Loss (determined as if the
Partnership sold all its Property for cash equal to the Property's fair market
value) upon the occurrence of either of the following events: (1) the making
by any Partner of any non-Pro Rata additional Capital Contribution, (2) the
partial or complete withdrawal of a Partner's Partnership Interest, or (3) the
admission of a Partner.
13. Expenses Paid by Partners. Any Partnership expense reasonably
paid by any Partner on behalf of the Partnership is an indebtedness o the
Partnership to the Partner and does not increase the Partner's Partnership
Interest or Percentage Interest. The Partnership shall reimburse the Partner
as soon as practicable and may pay interest on the indebtedness.
14. Loans by Partners. The Managing General Partner may borrow
money on behalf of the Partnership from any Partner in such amounts and for
such purposes as it considers necessary, convenient or incidental to the
accomplishment of the purposes of the Partnership. Each loan to the
Partnership by a Partner (excluding reimbursable expenses) shall be evidenced
by a promissory note or similar instrument of the Partnership, may be secured
by a lien on the Property, may bear interest at a rate determined by agreement
between such Partner and the Managing General Partner and may be subject to
such other terms and conditions as are agreed to by such Partner and the
Managing General Partner. The Partnership may prepay each loan from a Partner
in whole or in part, at any time and from time to time, without premium or
penalty.
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ARTICLE IV
PROFITS AND LOSSES AND TAXABLE INCOME AND TAXABLE LOSS
15. Allocations.
(a) Allocation of Profits and Losses.
(i) Profits and Losses of the
Partnership shall be determined for each fiscal year of the Partnership in
accordance with the cash method of accounting, with such exceptions thereto as
are set forth in this Agreement, and otherwise in accordance with generally
accepted accounting principles applied in a consistent manner.
(ii) Except as otherwise provided, the
Partnership's Losses, if any, arising in a fiscal year shall be allocated among
the Partners as follows:
(1) FIRST: To the extent of the
aggregate positive Capital Account balances of the Partners as of the end of
the fiscal year, Pro Rata to the Partners taking into account any changes in
Partnership Percentage Interests during the fiscal year.
(2) SECOND: Pro Rata, to the
General Partners.
(iii) Profits arising in a fiscal year
shall be allocated among the Partners as follows:
(1) FIRST: To the General Partners
until Profits allocated to the General Partners during the term of the
Partnership pursuant to this Section 15(a)(ii)(1) equal Losses allocated to the
General Partners during the term of the Partnership pursuant to Section
15(a)(ii)(2) then
(2) SECOND: To the Partners Pro
Rata taking into account any changes in Partnership Percentage Interests during
the fiscal year.
(b) Allocation of Taxable Income and Taxable
Loss.
(i) Except as otherwise provided in this
section 15(b), allocations of tax items among the Partners shall be consistent
with corresponding book (Profits and Losses) items (if any). For tax purposes,
Profits and Losses, or any item thereof, shall be appropriately adjusted to
reflect Taxable Income and Taxable Loss, or any item thereof, as determined
under the Code and shall be allocated among the Partners in such a manner as to
comply with the provisions of the Code and
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Regulations thereunder (including, if necessary, the "minimum gain chargeback
provisions" of the Regulations under Section 704 of the Code). For example,
any gain or loss recognized by the Partnership with respect to property
contributed to the Partnership by a Partner shall be shared among the Partners
so as to take account of the variation, if any, between the basis of the
property to the Partnership and its fair market value at the time of
contribution or revaluation, whichever is applicable, so as to comply with the
requirements of Section 704 of the Code. Thus, for example, if a Partner
contributes Property to the Partnership whose agreed fair market value exceeds
its adjusted basis in the hands of the contributing Partner ("built-in gain"),
and there have been no events giving rise to a revaluation, built-in gain with
respect to such contributed Property shall first be allocated to such
contributing Partner when the Partnership recognizes gain upon a disposition of
such contributed Property, but not in an amount in excess of such built-in
gain; the remaining balance of such recognized gain, if any, shall be allocated
among the Partners as set forth herein. The allocation of built-in gain to a
contributing Partner shall not increase such Partner's Capital Account, because
such gain was already taken into account when the built-in gain property was
contributed to the Partnership. A Partner who contributes property other than
cash shall provide the Managing General Partner with information necessary to
verify the contributing Partner's adjusted tax basis in the items of property
contributed by him to the Partnership.
(ii) Generally, except as provided in
section 15(b)(i), Taxable Income and Taxable Loss (and each such income and
loss item) shall be allocated Pro Rata among the Partners. In the event,
however, that non-Pro Rata distributions of property are made to a Partner or
the net proceeds from the sale of property are distributed non-Pro Rata to a
Partner, Taxable Income and Taxable Loss derived from such distributions or
sales shall be allocated 100% to such Partner, subject only to such
modifications as are necessary to comply with Section 704 of the Code. In
addition, no allocations of Taxable Loss shall be made to a Limited Partner
that would create a deficit balance in the Limited Partner's Capital Account.
ARTICLE V
DISTRIBUTIONS, WITHDRAWALS AND LOANS
16. Distributions.
(a) Cash Flow Distributions. Cash Flow shall be
distributed Pro Rata among the Partners.
(b) Partial or Complete Withdrawal by a Partner
From the Partnership.
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(i) In the event of a partial or
complete withdrawal of a Partner from the Partnership pursuant to Article VIII,
the Managing General Partner shall, as promptly as is reasonably possible,
distribute to the Partner his Pro Rata share of the Marketable Securities,
including stock of Reptron Electronics, Inc. previously contributed by such
Partner to the Partnership, cash and other readily divisible assets of the
Partnership. The withdrawing Partner shall also be entitled to receive cash
equal in value to his Pro Rata share of the fair market value (as reasonably
determined by the Managing General Partner) of any non-readily divisible assets
owned by the Partnership. The Managing General Partner shall, as promptly as
possible, distribute this additional amount of cash, if any, to the withdrawing
Partner. Cash distributions to the withdrawing Partner shall be reduced by
such Partner's Pro Rata share of the liabilities of the Partnership and by any
expenses incurred by the Partnership with respect to the withdrawal of the
Partner.
(ii) A Partner may request that all or a
portion of the Marketable Securities subject to the requested withdrawal be
sold by the Partnership and the net proceeds (after selling and other expenses)
distributed as directed by him. In the event that the Managing General Partner
is unable or unwilling to sell these Marketable Securities, it shall distribute
them to the Partner, unless it is notified by the Partner to cancel the
withdrawal.
(iii) The Managing General Partner shall not
be required to distribute to the requesting Partner any assets that the
Partnership is legally restricted or prohibited from distributing to the
Partner, unless steps can be taken to remove the restriction or prohibition; in
which case the requesting Partner shall be charged with the expense of removing
such restriction or prohibition. Any distribution hereunder shall also be
subject to the limitations set forth in sections 11(c) and 17, respectively.
(c) Liquidating Distributions. The net proceeds
from liquidation of the Partnership's assets pursuant to its dissolution,
winding-up, and termination shall be distributed, and all Profits and Losses
resulting from the liquidation of the Partnership Property shall be allocated,
among the Partners in the proportions and orders of priority specified in this
section 16(c).
(i) The Liquidator shall distribute the
net proceeds from liquidation of the Partnership's assets as follows:
(1) FIRST: To pay all the
liabilities of the Partnership that are then due and payable, except for both
Capital Contributions of Partners and liabilities to the Partners, in the order
of priority required by Nevada law; then
(2) SECOND: To establish any
reasonable reserve that the Liquidator may determine is required for unpaid,
future, or contingent
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liabilities or obligations of the Partnership; then
(3) THIRD: To pay all liabilities
of the Partnership to the Partners; Pro Rata according to the amounts of their
respective liabilities; then
(4) FOURTH: To the Partners to the
extent of any positive balances in their Capital Accounts, Pro Rata according
to the amounts of their respective positive balances; then
(5) FIFTH: Any remaining net
proceeds shall be distributed Pro Rata among the Partners.
(ii) Any Profits and Losses and Taxable
Income and Taxable Loss resulting from the disposition of the Partnership's
assets in the process of liquidation shall be allocated among the Partners in
the manner provided in section 15. Any Property distributed in kind in the
liquidation shall be valued and treated as if the Property were sold and the
cash proceeds were distributed. The Profits and Losses arising from the
constructive sale of the Property described in the preceding sentence shall be
allocated among the Partners in the manner provided in section 15.
17. Limitation on Distributions to Partners. A Partner may
receive distributions from the Partnership only to the extent the Partnership's
total assets exceed its total liabilities, other than liabilities to the
Partners on account of their Capital Contributions.
ARTICLE VI
AUTHORITY, DUTIES, AND LIABILITIES OF PARTNERS
18. Duties of Managing General Partner. The Managing General
Partner, and no other Partners, shall manage the affairs of the Partnership,
shall apply himself diligently for the Partnership, and shall devote to the
Partnership such time as is necessary and appropriate to manage the business of
the Partnership. The Managing General Partner is not required to devote all
its business time to the Partnership, and it may engage in other business
ventures and employment, including those in competition with the Partnership.
In the performance of its duties, the Managing General Partner may hire
employees and agents of the Partnership and generally shall supervise and
direct all the daily operations of the Partnership.
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19. Managing General Partner's Fees and Expenses.
(a) Fees to Managing General Partner. In
consideration for performing services described herein, the Managing General
Partner may be paid a fee as agreed to by a Majority in Interest. Such fees
shall be deemed earned when the services have been performed and, regardless of
when paid, shall be non-executory from the date earned and shall be the
obligation of the Partnership from and after that date.
(b) Expenses. Except as otherwise provided
herein, the Partnership shall pay all expenses of the Partnership (which
expenses may be either billed directly to the Partnership or reimbursed to the
Managing General Partner) which may include, but are not limited to: (i) all
costs of borrowed money, taxes and assessments on the Property and other taxes
applicable to the Partnership; (ii) all costs for goods and materials, whether
purchased by the Partnership directly or by the Managing General Partner on
behalf of the Partnership; (iii) legal, audit, accounting, brokerage and other
professional fees; (iv) fees and expenses paid to independent contractors,
mortgage bankers, brokers, insurance brokers and other agents; (v) expenses of
organizing, revising, amending, converting, modifying or terminating the
Partnership; (vi) expenses in connection with distributions made by the
Partnership to, and communications and bookkeeping work necessary in
maintaining relations with, Partners; (vii) expenses in connection with
preparing and mailing reports to Partners; (viii) costs of any accounting,
statistical or bookkeeping equipment necessary for the maintenance of the books
and records of the Partnership; (ix) the cost of preparation and dissemination
of informational material and documentation relating to the Partnership; (x)
except with respect to litigation solely among the Partners as such, costs
incurred in connection with any litigation in which the Partnership is
involved, as well as in the examination, investigation or other proceedings,
conducted against the Partnership by any regulatory agency, including legal and
accounting fees incurred in connection therewith; (xi) costs of any computer
services or equipment or services of personnel used for or by the Partnership;
and (xii) expenses of professionals employed by the Partnership in connection
with any of the foregoing, including attorneys, accountants and appraisers.
20. Authority of Managing General Partner. The Managing General
Partner may bind the Partnership to do all acts that are necessary,
appropriate, or incidental to the accomplishment of the purposes of the
Partnership. Any person dealing with the Partnership or the Managing General
Partner may rely on a certificate signed by the Managing General Partner as to
the identity of any Partner, the existence or absence of any fact or condition
that is necessary to permit action by either the Partnership or the Managing
General Partner or germane in any other way to the affairs of the Partnership,
and the persons who are authorized to execute and deliver any documents or
instruments of or on behalf of the Partnership. Without limiting the
generality of the foregoing, the Managing General Partner is specifically
authorized to do the following:
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(a) to negotiate and enter into leases and
agreements with land or building owners or other Persons, and to incur
obligations for, and on behalf of, the Partnership in connection with
Partnership business;
(b) to borrow money on behalf of the Partnership
and, as security therefor, to encumber the Property;
(c) to prepay, in whole or in part, refinance,
increase, modify or extend any obligation affecting the Property;
(d) to sell, exchange, convey and lease the
Property;
(e) to employ from time to time, at the expense
of the Partnership, other Persons required for the operation and management of
the Partnership business, including accountants, attorneys and others, who may
be Partners, on such terms and for such compensation as the Managing General
Partner determines to be reasonable and this may include Persons which are
Affiliates;
(f) to pay all attorney's and accountant's fees
and other costs incurred in connection with the formation of the Partnership
business and the completion of all steps necessary or advisable for the
Partnership to comply with applicable laws;
(g) to assume the responsibilities imposed on
the Managing General Partner by the Act;
(h) to compromise, arbitrate or otherwise adjust
claims in favor of or against the Partnership and to carry such insurance as
the Managing General Partner considers advisable;
(i) to exercise the voting rights associated with
the securities and other Property owned by the Partnership;
(j) to commence or defend litigation with respect
to the Partnership or any assets of the Partnership as the Managing General
Partner considers advisable, at the expense of the Partnership;
(k) to make, execute, acknowledge and deliver
documents of transfer and conveyance and any other instruments that may be
necessary or appropriate to carry out its powers; and
(l) to do all such acts and take all such
proceedings and execute all such rights and privileges, although not
specifically mentioned herein, as the Managing General Partner considers
necessary to conduct the business of the
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Partnership and to carry out the purposes of the Partnership.
Notwithstanding the foregoing, the Managing General
Partner shall not take any of the following actions without the consent of a
Majority in Interest:
(1) assign all or any part of the
property for the benefit of its creditors or confess a judgment against the
Partnership;
(2) take any action in
contravention of the Act, the certificate of limited partnership or this
Agreement;
(3) sell, lease, transfer, assign,
pledge or encumber a substantial portion (10% or more) in value of the property
of the Partnership (except with respect to transactions to which section 32 or
section 37 applies);
(4) loan an amount of money in
excess of $100,000 to a Partner; or
(5) admit a Person as a General
Partner of the Partnership.
21. Special Limitation. During the period the Partners have
determined that the Partnership will only be availed of only for investment
purposes, which shall be the period, if any, contemplated by Section 6(c), the
Managing General Partner may not purchase, sell, or exchange Marketable
Securities without the consent of the Partners to whom the Marketable
Securities are deemed owned or allocated for federal income tax purposes, but
the Managing General Partner shall have voting rights and all other aspects of
management and control over such Marketable Securities.
22. Dealing with Affiliates. The Managing General Partner may
employ and enter into contracts and other arrangements with any Person,
including an Affiliate, and may obligate the Partnership to pay reasonable
compensation for services rendered by such Persons on terms that, in the
judgment of the Managing General Partner, are not less favorable to the
Partnership than would be available from an unrelated party.
23. Indemnification of General Partner. The Managing General
Partner need not secure the performance of its duties by bond or otherwise. A
General Partner is not liable, responsible, or accountable in damages or
otherwise to any Partner or to the Partnership for any act taken or omission
made in good faith on behalf of the Partnership and in a manner that such
General Partner reasonably believes to be within the scope of the authority
granted to it by this Agreement and in the best interest of the Partnership,
except for gross negligence or willful misconduct. Any loss, expense
(including attorneys' fees) or damage incurred by a General Partner by reason
of any act or omission by it in good faith on behalf of the Partnership and in
a manner
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that it reasonably believes to be within the scope of the authority granted to
it by this Agreement and in the best interest of the Partnership (but not, in
any event, any loss, expense or damage incurred by a General Partner by reason
of gross negligence or willful misconduct) shall be paid to the indemnified
General Partner from the Partnership's assets, to the extent available.
24. Liability of Non-Managing General Partners and Limited
Partners. The non-managing General Partners are not liable to any other
Partner for the gross negligence or willful misconduct of the Managing General
Partner. The liability of each Limited Partner is limited to its Capital
Contributions. Except as provided by the Act, a Limited Partner is not
required to contribute money to, or for the liabilities of the Partnership, and
is not personally liable for any loss, liability or other obligations of the
Partnership.
25. Authority of Limited Partners and Non-Managing General
Partners. The Limited Partners shall not, and notwithstanding the Act the
non-managing General Partners shall not, participate in the management of, or
have any control over, the business or policies of the Partnership, nor any
control over Marketable Securities, except as required by the Act or permitted
by section 20, and the Limited Partners and non-managing General Partners shall
not transact any business in the name of the Partnership. Unless required by
the Act, a non-managing General Partner shall not sign any agreement, document
or instrument in the name of the Partnership or otherwise make commitments on
behalf of the Partnership. Notwithstanding the foregoing, the Partners may
make the election set forth in Treas. Reg. Section 1.761-2 to have the
Partnership excluded from the provisions of Subchapter K of Chapter 1 of the
Code. In the event a Partner ceases to serve as Managing General Partner, a
Majority in Interest of the Partners shall appoint another Partner to serve as
the Managing General Partner.
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ARTICLE VII
TRANSFER OF PARTNERSHIP INTERESTS
26. Limited Partners. A Limited Partner shall not pledge,
encumber or hypothecate his interest in the Partnership without the consent of
the Managing Partner. Otherwise, subject to sections 28 and 29, and only if
the Managing General Partner consents, a Limited Partner may make an Assignment
of a Limited Partnership Interest. However, an Assignment does not relieve the
Limited Partner of his obligations and liabilities under this Agreement, or
constitute the assignee a Limited Partner, or confer on the assignee any
Partnership Rights. An assignee of a Limited Partner's Partnership Interest
may be admitted and substituted as a Limited Partner and acquire Partnership
Rights only upon the satisfactory completion of the requirements specified in
section 29. The failure or refusal of the Managing General Partner to consent
to the admission of an assignee as a Limited Partner does not affect the right
of the assignee to the Partnership Interest of his predecessor in interest.
27. General Partner. Subject to section 28, a General Partner may
make an Assignment, directly or indirectly, of all or any part of its
Partnership Interest. However, an Assignment does not relieve such General
Partner of its obligations and liabilities under this Agreement, or constitute
the assignee a General Partner, or confer on the assignee any Partnership
Rights. Subject to section 28, and only if a Majority in Interest consents, a
General Partner may make an Assignment of both its Partnership Interest and its
Partnership Rights if the assignee assumes in writing all such General
Partner's obligations and liabilities under this Agreement and if all the
applicable requirements of section 29 are satisfied. Upon compliance with the
immediately preceding sentence, an assignee of such General Partner has all the
rights and powers granted to such General Partner under this Agreement and has
all the obligations and liabilities of such General Partner under this
Agreement.
28. Restriction on Transfer. Notwithstanding any other provision
of this Agreement, an assignment of a Partnership Interest shall not be made,
and consent thereto shall be withheld:
(a) Unless the Managing General Partner has
satisfied itself (by seeking advice of legal counsel or otherwise, with any
resulting Partnership expense to be reimbursed by the assignor) that the
assignment will not have any significant adverse tax effect upon the
Partnership or the other Partners;
(b) Unless the Managing General Partner has
satisfied itself (by advice of legal counsel, with any resulting Partnership
expense to be reimbursed by the assignor) that the proposed assignment may be
made without registration under any applicable securities law; and it will not
violate any applicable securities law (including investor suitability
standards);
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(c) If the Assignment is sought to be made to:
(i) a minor or incompetent, except if
made by will or intestate succession, or
(ii) to a Person which is not an
Affiliate.
29. Admission of Substitute Partner. Subject to the other
provisions of this Agreement, an assignee of a Partnership Interest may be
admitted as a Partner and granted Partnership Rights only if:
(a) the Assignment is made pursuant to a written
instrument in a form satisfactory to the Managing General Partner and specifies
the intention of the assignor that the assignee be substituted as a Partner;
(b) the Managing General Partner consents to the
admission by executing two counterparts of this Agreement that evidences the
Partnership Rights of the assignee, and if the assignee is to be admitted as a
Partner a Majority in Interest consent to the admission;
(c) the assignee accepts, signs and agrees to be
bound by this Agreement, by executing two counterparts of this Agreement,
including an amended EXHIBIT A, and such other documents or instruments as the
Managing General Partner requires to effect the admission of the assignee as a
Partner;
(d) the assignee provides the Managing General
Partner with evidence satisfactory to it of the assignee's authority to become
a Partner under the terms of this Agreement;
(e) the assignee pays all filing, publication and
other costs (including reasonable attorneys' fees) incurred by either the
Partnership or the Managing General Partner in connection with the admission
and substitution of the assignee as a Partner.
Notwithstanding an assignee's satisfaction of any or all of
the conditions specified above, the Managing General Partner, in its absolute
discretion, may refuse to consent to the assignee's admission as a Partner, in
which event the assignee will not obtain any Partnership Rights, but will
retain only the rights of an assignee under sections 26 or 27.
30. Rights of Partner After Assignment and Substitution. Upon the
Assignment of all his Partnership Interest, and the admission of a substitute
partner, a Partner shall cease to be a Partner and to have any Partnership
Rights.
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31. Allocations and Distributions After Assignment. For the
purposes of allocations of Profits and Losses, Taxable Income or Taxable Loss,
and distributions, an Assignment of a Partnership Interest is effective as to
the Partnership, and shall be reflected in the records of the Partnership, as
of the date that the Managing General Partner receives written notice of the
Assignment. The Taxable Income or Taxable Loss, Profits and Losses and cash
and other distributions in respect of the assigned Partnership Interest with
respect to the fiscal year in which the Assignment of the Partnership Interest
occurs shall be divided between the assignor and the assignee according to the
method provided to the Managing General Partner by the assignor and the
assignee, so long as such method is permitted under the Code and does not
adversely affect the other Partners or the Partnership from a tax or economic
perspective. The method of allocation shall be provided to the Managing
General Partner in the written notice of the Assignment. Any additional costs
for computing the allocations hereunder shall be paid by the assignor or
assignee, as the case may be. The written notice referred to above shall also
contain information as to whether the assignor or assignee shall be responsible
for the payment of such additional cost, if any.
ARTICLE VIII
RETIREMENT, WITHDRAWAL, OR REMOVAL OF PARTNERS
32. Withdrawal of Non-Managing General Partner or Limited Partner.
(a) A non-managing General Partner or a Limited
Partner may, at any time, partially withdraw his Partnership Interest from the
Partnership by providing written notice thereof to the Managing General
Partner. The Managing General Partner shall promptly send a copy of such
notice to all other Partners. Within thirty (30) days after the receipt of
such written notice from a Partner, the Managing General Partner shall make the
appropriate distributions to the Partner in partial or complete redemption of
his Partnership Interest as set forth in section 16(b).
(b) A partial withdrawal by a Partner shall be
made in increments of one-tenth (1/10th) of one percent (1%) of a Percentage
Interest. The written notice of withdrawal from a Partner to the Managing
General Partner must state whether the withdrawal is a partial or complete
withdrawal and, if a partial withdrawal, must state the Percentage Interest
that is being withdrawn. A Partner shall not make a partial withdrawal that
will result in his remaining Percentage Interest becoming less than one-tenth
(1/10th) of one percent (1%) immediately after the withdrawal.
(c) The Managing General Partner agrees that it
will fully cooperate to the extent permitted by law to accomplish a withdrawal
requested by a Partner hereunder. It also agrees that it will not take any
action that will obstruct or
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<PAGE> 32
render impossible the application of this section 32 (such as to pledge the
Partnership's Marketable Securities as collateral to creditors of the
Partnership), unless such action is essential to accomplish the purposes of the
Partnership.
(d) The partial withdrawal of a non-managing
General Partner does not dissolve or terminate the Partnership unless there is
only one Partner then remaining. The remaining Partners shall amend this
Agreement to reflect the partial or complete withdrawal of the Partner from the
Partnership, if and to the extent necessary.
(e) Upon the giving of the notice of withdrawal
pursuant to Paragraph (a), and upon the dissolution of the Partnership, the
voting rights with respect to any stock of Reptron Electronics, Inc. allocable
to the Percentage Interest being withdrawn shall be vested in the withdrawing
Partner or Partners, and the Partnership shall have no voting rights with
respect to such stock.
(f) The complete withdrawal of all the Limited
Partners shall constitute a dissolution of the Partnership pursuant to Article
IX.
33. Retirement or Withdrawal of Managing General Partner. The
Managing General Partner may not withdraw any part of its General Partnership
Interest and, non-managing General Partner may not completely withdraw his
General Partnership Interest without the consent of a Majority in Interest.
The Retirement or withdrawal of the Managing General Partner shall dissolve the
Partnership. Notwithstanding the foregoing or anything else in this Agreement
to the contrary, a merger, consolidation, or reorganization of a Managing
General Partner who is not a natural person, or a sale of all or substantially
all its assets that includes its Partnership Interest, is not a Retirement or
withdrawal of such Managing General Partner if the resulting, surviving or
acquiring Person is an Affiliate and becomes substituted as the Managing
General Partner of the Partnership. The resulting, surviving or acquiring
Person is substituted as the Managing General Partner without further act if it
gives notice of the substitution to the Partners before the effective date of
the merger, consolidation, reorganization or sale. Each Partner consents to
the admission and substitution of such substitute Managing General Partner
pursuant to this section 33, and no further consent or approval of any Partner
is required.
34. Retirement of Limited Partner. The Retirement of a Limited
Partner does not dissolve or terminate the Partnership except as provided in
section 36(g), but the legal or personal representatives, heirs, successors,
assignees, or stockholders of a Retired Limited Partner, subject to section 26,
shall succeed to the Partnership Interests of the Retired Limited Partner and
may make an Assignment of the Partnership Interests within the limitations set
forth in this Agreement.
35. Rights of Partner After Retirement or Withdrawal. A Partner
ceases to
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have any Partnership Rights upon his Retirement or complete withdrawal from
the Partnership. However, until the appropriate distributions, if any, are
made to a Retired or withdrawn Partner for his Partnership Interest, the
Retired or withdrawn Partner is entitled to receive the allocations of Profits
and Losses, Taxable Income or Taxable Loss and all distributions referred to in
section 16 applicable to his Partnership Interest.
ARTICLE IX
DISSOLUTION
36. Events of Dissolution. The Partnership shall be terminated
and dissolved upon:
(a) the expiration of its term;
(b) the vote of a Majority in Interest to
dissolve the Partnership;
(c) the Partnership being adjudicated insolvent
or bankrupt;
(d) the Retirement or withdrawal of the Managing
General Partner;
(e) the death of Michael L. Musto; or
(f) the sale of all or substantially all of the
Partnership's Property.
(g) the complete withdrawal of the Limited
Partners.
37. Winding-Up and Distributions. Upon the dissolution of the
Partnership pursuant to section 36, the winding-up of the Partnership's
business and the liquidation and distribution of Partnership assets must be
carried out with due diligence and in a timely manner, and consistent with both
the requirements of applicable law and the following provisions of this
section:
(a) The Managing General Partner shall be
responsible for taking all actions relating to the winding-up, liquidation, and
distribution of assets of the Partnership, unless its Retirement or withdrawal
causes the dissolution, in which case the fiscal agent, liquidator, or receiver
appointed (without judicial action) by a Majority in Interest shall be so
responsible. The Managing General Partner, or the appointed fiscal agent,
liquidator, or receiver, is referred to in this Agreement as the "Liquidator."
A non-managing General Partner can be appointed to be the Liquidator. The
Liquidator shall file all certificates or notices of the dissolution of the
Partnership
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as required by law. Upon the complete liquidation and distribution of the
Partnership assets, the Partnership shall terminate, and the Liquidator shall
execute, acknowledge, and cause to be filed all certificates and notices
required by law to terminate the Partnership.
(b) The Liquidator shall proceed without
unnecessary delay to sell and otherwise liquidate the Partnership's assets.
Unless directed otherwise by a Majority in Interest, all Marketable Securities,
including interests in Reptron Electronics, Inc., cash and other readily
divisible or fungible assets of the Partnership shall be distributed directly
to the Partners in the manner set forth in section 16(c)(i). The Liquidator
shall promptly sell the other assets of the Partnership unless it determines
that an immediate sale of part or all of such assets would cause undue loss to
the Partners. In such case, the Liquidator, to avoid such loss, may defer the
liquidation of the Partnership assets for a reasonable time, except for those
liquidations that are necessary to satisfy the debts and liabilities of the
Partnership to persons and parties other than the Partners. The Liquidator
shall distribute the proceeds from the liquidation of the Partnership's assets
as provided in section 16(c).
(c) Upon the dissolution of the Partnership
pursuant to section 36, the Liquidator shall cause the accountants for the
Partnership to prepare within ninety (90) days after the occurrence of the
event of dissolution, and immediately thereafter shall furnish to each Partner,
a statement setting forth the assets and liabilities of the Partnership as of
the date of its dissolution. The Liquidator, promptly following the complete
liquidation and distribution of the Partnership's assets, shall cause the
Partnership's accountants to prepare, and the Liquidator shall furnish to each
person who is a Partner immediately before the dissolution, a statement showing
the manner in which the Partnership assets were liquidated and distributed.
38. Distribution of Liquidation Proceeds and Assets and Allocation
of Gains and Losses. The net proceeds from liquidation of the Partnership's
assets and the unliquidated Property of the Partnership shall be distributed,
and all Profits and Losses resulting from the liquidation of the Partnership
shall be allocated, among the Partners in the proportions and orders of
priority specified in section 16(c).
39. Limitation of Liability of Partners. Upon the dissolution of
the Partnership and the distribution of the net liquidation proceeds pursuant
to section 36 and section 16(c), each Partner shall look solely to the assets
of the Partnership for the payment of his unreturned Capital Contributions, and
if the Partnership's assets remaining after the payment or discharge of the
debts and liabilities of the Partnership are insufficient to pay the full
amount of the unreturned Capital Contributions of each Partner, the Partner
shall have no recourse or claim against any Partner or the Partnership with
respect to its unreturned Capital Contributions, except for claims for fraud,
gross negligence, or breach of fiduciary duty.
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40. Waiver of Right of Partition of Assets. Each Partner, and for
his heirs, successors, and assigns, waives his right to the partition of the
assets of the Partnership upon the dissolution and liquidation of the
Partnership.
ARTICLE X
ACCOUNTING YEAR, BOOKS, RECORDS, AND REPORTS
41. Books and Records. The Managing General Partner shall
maintain at the principal office of the Partnership a complete and accurate set
of books of records and accounts, in which it shall make full and complete
entries of all dealings or transactions relating to the Partnership's business
and where it shall keep all supporting documentation of transactions with
respect to the conduct of the Partnership's business. Each Partner or his duly
authorized representative, upon five days' advance notice to the Managing
General Partner, may examine during normal business hours the books of the
Partnership and all other records and information concerning the operation of
the Partnership.
42. Reports. If requested by a Partner at least 30 days prior to
the end of a quarter, within 60 days after the end of each fiscal quarter in
each fiscal year of the Partnership, the Managing General Partner shall cause
to be prepared and sent to each Partner a balance sheet, income statement and
cash flow statement of the Partnership for and as of the end of that fiscal
quarter, in each case unaudited but accompanied by a report of the activities
of the Partnership for that quarter. Within 90 days after the end of each
fiscal year of the Partnership, the Managing General Partner shall cause to be
prepared and sent to each Partner a financial report consisting of (a) a
balance sheet as of the end of the fiscal year; (b) statements of income,
partner's equity, and changes in financial position for the fiscal year; (c) if
requested by a Partner, the opinion of the Partnership's certified public
accountant concerning the foregoing financial statements; (d) a summary of the
Partnership's activities for the fiscal year; (e) a statement showing the
distributions to each Partner during the fiscal year and identifying any
distributions which constitute a return of Capital Contribution; and (f) a
statement showing the amount of Taxable Income or Taxable Loss, and listing
each item of income, gain, loss, deduction, or credit allocated or charged
against the Partner for federal and state income tax purposes.
43. Bank Accounts. The Managing General Partner shall maintain
the bank accounts of the Partnership in such financial institutions as the
Managing General Partner considers appropriate. The Managing General Partner
shall make or permit withdrawals from the Partnership's bank accounts on the
signature of the Managing General Partner.
44. Tax Elections. If the Partnership has not made the election
set froth in
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<PAGE> 36
Treas. Reg. Section 1.761-2, or if Subchapter K of Chapter 1 of the Code
applies to the Partnership, the Partnership shall file an election under
Section 754 of the Code, relating to the optional adjustment to the basis of
partnership property, at the first time it is permitted to do so after the
beginning of the term of this Partnership. The Managing General Partner shall
make or waive, at its discretion, all other tax elections required or permitted
to be made by the Partnership under the Code.
45. Accounting Method and Fiscal Year. The Managing General
Partner shall maintain the Partnership records and books of accounts in
accordance with the cash method of accounting, with such modifications as are
set forth in this Agreement, and otherwise in accordance with generally
accepted accounting principles consistently applied. The fiscal year of the
Partnership is the calendar year.
ARTICLE XI
GENERAL PROVISIONS
46. Power of Attorney. Each Limited Partner (including each
substitute Limited Partner), by executing a counterpart of this Agreement,
irrevocably constitutes and appoints, with full power of substitution, the
Managing General Partner as his true and lawful attorney-in-fact, with full
power and authority in his name, place and stead to make, execute, acknowledge,
deliver, swear to, publish, record and file:
(a) any certificate or other instrument that may
be required to be filed, published or recorded by the Partnership under the Act
or any other law of Nevada or that the Managing General Partner considers
advisable to file, publish or record;
(b) all documents (including schedules and
amendments to this Agreement) that may be required to effect the continuation
or reinstatement of the Partnership, admit an additional or substitute Partner
(other than any approval required of Limited Partners), reduce the Capital
Contributions of a Partner, or dissolve and terminate the Partnership; and
(c) all amendments to this Agreement adopted in
accordance with section 55.
The foregoing power of attorney is coupled with an interest, resulting from
each Limited Partner's reliance on the power of the attorney-in-fact to act as
contemplated by this Agreement for the purposes described in this section 46.
The foregoing power of attorney shall survive the Retirement of a Limited
Partner and the Assignment by any Limited Partner of all or any part of his
Partnership Interest, except that when an assignee is granted Partnership
Rights and admitted as a substitute Limited Partner
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the power of Attorney of the assignor Limited Partner shall survive the
Assignment only for the purpose of enabling the Managing General Partner to
make, execute, acknowledge, deliver, swear to, publish, record and file every
instrument necessary to effect the substitution.
47. Partnership Contracts. The Managing General Partner may enter
into agreements and contracts on behalf of the Partnership only if they are in
writing and clearly indicate to the other parties that the Partnership is a
general partnership of which the Managing General Partner is a general partner.
48. Conveyances. Subject to section 20, the Managing General
Partner may sign any deed, mortgage, lease, bill of sale, security agreement,
pledge, contract or other instrument or commitment purporting to convey or
encumber any of the Partnership's Property or any interest therein, whether now
or subsequently owned or leased at any time by the Partnership, and no other
signature is required.
49. Notices. To be effective, a notice required or permitted by
this Agreement must be in writing, or by telegram, telex or telecopy if
promptly confirmed in writing. A notice is given when delivered or, if mailed,
when deposited in a United States postal service letterbox to be sent by
first-class, postage-prepaid, certified mail, with return receipt requested
(whether or not the sender receives the return receipt), and addressed, if to a
Partner, at his registered address listed on EXHIBIT A and, if to the Managing
General Partner or the Partnership, to the attention of such Managing General
Partner at the Partnership's principal business office.
50. Consents. Any consent required by this Agreement may be given
as follows:
(a) by a writing given by the consenting Partner
and received by the Managing General Partner or other appropriate recipient at
or before the occurrence of the action or other thing for which the consent was
solicited, unless the consent is nullified by:
(i) A writing from the consenting
Partner that is received by the Managing General Partner before the occurrence
of the action or other thing for which the consent was solicited; or
(ii) the negative vote by the consenting
Partner at any meeting called for the purpose of considering the action or
other thing.
(b) by the affirmative vote of the consenting
Partner at any meeting called for the purpose of considering the action or
other thing for which the Partner's consent was solicited.
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51. Meetings. The Managing General Partner may call meetings of
the Partners for any purpose, at any, time. The Managing General Partner shall
call a meeting of the Partners within 30 days after he receives from a Majority
in Interest a written request for a meeting, stating the purpose of the
requested meeting and the matters proposed for consideration. Meetings of the
Partners may be held at such time, date and place as the Managing General
Partner designates. The Managing General Partner shall give notice of any
meeting of the Partners not less than ten nor more than 60 days before the date
of the meeting, to each Partner at his registered address listed on EXHIBIT A.
The notice shall state the time, date and place of the meeting, the purpose of
the meeting and the Partner at whose direction or request the meeting is
called. Except in the case of emergency, meetings of the Partnership shall be
held in Nevada. If a meeting is adjourned to another time or place, notice of
the adjourned meeting is not required if the time and place of the adjournment
is announced at the called meeting. The presence in person or by proxy of a
Majority in Interest constitutes a quorum at a meeting. Any notice of a
meeting required by this section may be waived in writing at, before or after
the meeting and shall be deemed to be waived by each Partner who is present in
person or by proxy at the meeting. Only those persons who are Partners at the
close of business on the day before the meeting are entitled to vote at the
meeting. Any Partner entitled to vote at a meeting may authorize any person to
act for him by written proxy if a copy of the proxy is delivered to the
Managing General Partner before the commencement of the meeting. To be
effective, a proxy must be signed by the Partner (and, if applicable, each
co-owner) or his duly appointed attorney-in-fact, and no proxy shall be valid
for more than 11 months after its date. A proxy is revocable at the pleasure
of the Partner granting it.
52. Binding Effect; Counterparts. The covenants and agreements
contained in this Agreement are binding on, and inure to the benefit of, the
legal and personal representatives, heirs, successors and permitted assignees
of the parties to this Agreement. The parties may execute this Agreement in
any number of counterparts, each of which will be an original, but all of which
together will constitute one and the same agreement.
53. Choice of Law. This Agreement and the rights and obligations
of the Partners under it are governed by, and construed and enforced in
accordance with, the laws of Nevada.
54. Complete Agreement; Modification. This Agreement contains the
final, complete and exclusive expression of the understanding among the
Partners with respect to the Partnership and its purposes and objectives and
supersedes any prior or contemporaneous agreement or representation, oral or
written, by any of them. Except to admit a new or a substitute Partner or to
reflect the withdrawal or Retirement of a Partner, this Agreement and every
provision of it may be modified or amended only by an agreement in writing
signed by or on behalf of all Partners.
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55. Evidence of Partnership Interests. The Partnership Interest
of each Partner is evidenced exclusively by a counterpart of this Agreement
(including EXHIBIT A) that has been signed and dated by the Managing General
Partner.
56. Tax Matters Partner. The Managing General Partner or its
designee shall be the "tax matters partner" of the Partnership for federal
income tax purposes. If the Managing General Partner ceases to act as the
Managing General Partner of the Partnership, the successor Managing General
Partner (if any), shall be, designated the tax matters partner. Pursuant to
Section 6223(c)(2) of the Code, upon receipt of notice from the Internal
Revenue Service of the beginning of an administrative proceeding with respect
to the Partnership, the Managing General Partner, as the tax matters partner,
shall furnish the Internal Revenue Service with the names, addresses, and
Percentage Interests of each of the Partners. The Managing General Partner
agrees not to enter into a settlement agreement pursuant to Section 6224 of the
Code without providing at least 30 days advance written notice to each Partner.
As tax matters partner, the Managing General Partner shall have absolute
discretion regarding whether to seek judicial review of any administrative
determination and, if it determines to seek judicial review of Internal Revenue
Service action pursuant to Section 6226 of the Code, then the Managing General
Partner shall select the judicial forum for such review. The tax matters
partner shall receive no compensation for its services as such. The
Partnership shall bear all third party costs and expenses incurred by the tax
matters partner in performing its duties as such. Nothing herein shall be
construed to restrict the Partnership from engaging an accounting firm or law
firm to assist the tax matters partner in discharging its duties hereunder.
57. Gender and Number. As used in this Agreement, the masculine
gender includes the feminine and neuter, and the singular includes the plural.
58. Title. Title to any Property acquired by the Partnership
shall be taken in the name of the Partnership.
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<PAGE> 40
IN WITNESS WHEREOF, this Agreement has been executed by or on behalf
of each Partner as of the date written beside his name.
MANAGING GENERAL PARTNER:
MLM, Inc., a Nevada corporation
By:/s/ Michael L. Musto
-----------------------------------
as its President
GENERAL PARTNER:
MICHAEL L. MUSTO REVOCABLE LIVING TRUST
By:/s/ Michael L. Musto
------------------------------------
Michael L. Musto, as Trustee
LIMITED PARTNER:
MICHAEL L. MUSTO GRANTOR RETAINED
ANNUITY TRUST
By:/s/ Michael L. Musto
------------------------------------
Michael L. Musto, as Trustee
MICHAEL L. MUSTO REVOCABLE LIVING TRUST
By:/s/ Michael L. Musto
------------------------------------
Michael L. Musto, as Trustee
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<PAGE> 41
Exhibit 2
Joint Filing Agreement
In accordance with Rule 13d-1(f) under the Securities Exchange Act of
1934, as amended, the persons named below agree to the joint filing on behalf
of each of them of a statement on Schedule 13D filed on February 13th, 1997
including any amendment thereto. This Joint Filing Agreement shall be included
as an Exhibit to such joint filing. In evidence thereof, each of the
undersigned, being duly authorized, hereby executed this Agreement this 13th
day of February, 1997.
/s/ Michael L. Musto
--------------------------------------
Michael L. Musto
MLM, INC.
By: /s/ Michael L. Musto
-----------------------------------
Michael L. Musto, President
Michael L. Musto Revocable Living Trust
By: /s/ Michael L. Musto
-----------------------------------
Michael L. Musto, Trustee
