<PAGE>
EXHIBIT 4(a)
AGREEMENT OF LIMITED PARTNERSHIP
OF
KIMCO WESTLAKE L.P.
---------------
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION, UNLESS THE TRANSFEROR DELIVERS TO THE PARTNERSHIP
AN OPINION OF COUNSEL SATISFACTORY TO THE PARTNERSHIP, IN
FORM AND SUBSTANCE SATISFACTORY TO THE PARTNERSHIP, TO THE
EFFECT THAT THE PROPOSED SALE, TRANSFER OR OTHER DISPOSITION
MAY BE EFFECTED WITHOUT REGISTRATION UNDER THE ACT AND UNDER
APPLICABLE STATE SECURITIES OR "BLUE SKY" LAWS.
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ARTICLE 1
DEFINED
TERMS...................................................................................1
ARTICLE 2
ORGANIZATIONAL
MATTERS.........................................................................13
Section 2.1
Formation.............................................................................13
Section 2.2
Name..................................................................................13
Section 2.3
Registered Office and Agent; Principal
Office.........................................13
Section 2.4
Power of
Attorney.....................................................................13
Section 2.5
Term..................................................................................15
Section 2.6
Certificates Evidencing Partnership
Interests.........................................15
ARTICLE 3
PURPOSE........................................................................................15
Section 3.1
Purpose and
Business..................................................................15
Section 3.2
Powers................................................................................16
ARTICLE 4
CAPITAL
CONTRIBUTIONS..........................................................................16
Section 4.1
Capital Contributions of the
Partners.................................................16
Section 4.2 No
Issuance of Additional Partnership
Interests.......................................17
Section 4.3
Discretionary Capital
Contributions...................................................17
Section 4.4
[Intentionally left
blank]............................................................17
Section 4.5 No
Third Party
Beneficiary............................................................17
ARTICLE 5
DISTRIBUTIONS..................................................................................17
Section 5.1
Requirement and Characterization of
Distributions.....................................17
Section 5.2
Amounts
Withheld......................................................................19
ARTICLE 6
ALLOCATIONS OF PROFIT AND
LOSS.................................................................20
Section 6.1
Capital
Accounts......................................................................20
Section 6.2 Net
Income, Losses and Distributive
Shares............................................21
Section 6.3
Negative Capital
Accounts.............................................................25
Section 6.4
Application to
Assignees..............................................................25
ARTICLE 7
MANAGEMENT AND OPERATIONS OF
BUSINESS..........................................................25
Section 7.1
Management............................................................................25
Section 7.2
Certificate of Limited
Partnership....................................................28
Section 7.3
Restrictions on General Partner
Authority.............................................28
Section 7.4
Reimbursement of the General
Partner..................................................30
Section 7.5
Contracts with
Affiliates.............................................................30
Section 7.6
Indemnification.......................................................................30
Section 7.7
Liability of the General
Partner......................................................32
Section 7.8
Other Matters Concerning the General
Partner..........................................33
Section 7.9
Title to Partnership
Assets...........................................................34
Section 7.10 Reliance
by Third
Parties.............................................................34
Section 7.11 General Partner's Capital
Contribution to Fund the Prorations and Other
Expenses under the Contribution
Agreement.............................................35
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ARTICLE 8
RIGHTS AND OBLIGATIONS OF LIMITED
PARTNERS.....................................................35
Section 8.1
Limitation of
Liability...............................................................35
Section 8.2
Management of
Business................................................................35
Section 8.3
Outside Activities of Limited Partners and
Assignees..................................36
Section 8.4
Return of
Capital.....................................................................36
Section 8.5
Exchange Rights of Qualifying
Parties.................................................36
Section 8.6 The
General Partner's Right to Call Limited Partner
Interests.........................40
Section 8.7
Other
Exchanges.......................................................................41
ARTICLE 9
BOOKS, RECORDS, ACCOUNTING AND
REPORTS.........................................................42
Section 9.1
Records and
Accounting................................................................42
Section 9.2
Fiscal
Year...........................................................................42
Section 9.3
Reports and Partnership
Information...................................................42
Section 9.4
Confidential
Material.................................................................43
ARTICLE 10
TAX
MATTERS....................................................................................43
Section 10.1
Preparation of Tax
Returns............................................................43
Section 10.2 Tax
Elections.........................................................................43
Section 10.3 Tax
Matters
Partner...................................................................44
Section 10.4
Organizational
Expenses...............................................................45
Section 10.5
Withholding...........................................................................45
ARTICLE 11
TRANSFERS AND
WITHDRAWALS......................................................................46
Section 11.1 Transfer
.............................................................................46
Section 11.2 Transfer
of the General Partner
Interest..............................................47
Section 11.3 Limited
Partners' Rights to
Transfer..................................................48
Section 11.4
Substituted Limited
Partners..........................................................49
Section 11.5
Assignees.............................................................................49
Section 11.6 General
Provisions....................................................................50
ARTICLE 12
ADMISSION OF
PARTNERS..........................................................................51
Section 12.1 Admission
of Successor General
Partner................................................51
Section 12.2 Amendment
of Agreement and Certificate of Limited
Partnership.........................51
ARTICLE 13
DISSOLUTION, LIQUIDATION AND
TERMINATION.......................................................52
Section 13.1
Dissolution...........................................................................52
Section 13.2 Winding
Up............................................................................52
Section 13.3 Rights of
Partners and
Assignees......................................................53
Section 13.4 Notice of
Dissolution.................................................................54
Section 13.5
Termination of Partnership and Cancellation of Certificate of
Limited
Partnership...........................................................................54
Section 13.6 Reasonable
Time for
Winding-Up........................................................54
Section 13.7 Waiver of
Partition...................................................................54
ARTICLE 14
AMENDMENT OF PARTNERSHIP AGREEMENT;
MEETINGS...................................................54
Section 14.1
Amendments............................................................................54
Section 14.2 Meetings
of the
Partners..............................................................55
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ARTICLE 15
GENERAL
PROVISIONS.............................................................................55
Section 15.1 Addresses
and
Notice..................................................................55
Section 15.2 Titles and
Captions...................................................................56
Section 15.3 Pronouns
and
Plurals..................................................................56
Section 15.4 Further
Action........................................................................56
Section 15.5 Binding
Effect........................................................................56
Section 15.6
Creditors.............................................................................56
Section 15.7
Waiver................................................................................56
Section 15.8
Counterparts..........................................................................56
Section 15.9 Applicable
Law........................................................................57
Section 15.10 Invalidity of
Provisions..............................................................57
Section 15.11 Entire
Agreement......................................................................57
Exhibit A
Partners Contributions and Partnership Interests
Exhibit B
Form of Notice of Exchange
Exhibit C
Form of Prospective Subscriber Questionnaire
Exhibit D
Representations and Warranties
Exhibit E
Form of Tax Protection Agreement
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<PAGE>
AGREEMENT
OF LIMITED PARTNERSHIP
OF
KIMCO WESTLAKE L.P.
THIS AGREEMENT OF LIMITED PARTNERSHIP OF KIMCO WESTLAKE L.P. (as it
may
be amended, supplemented or restated from
time to time, this "Agreement"), dated
as of October 22, 2002 (the "Closing
Date"), is entered into by Kimwest 186,
Inc., a Delaware corporation (the "General
Partner"), Kimco Realty Corporation,
a Maryland corporation (the "Kimco Limited
Partner") and the Persons (as defined
below) whose names are set forth on Exhibit
A attached hereto (as it may be
amended from time to time) (collectively,
including the Kimco Limited Partner,
the "Limited Partners").
WHEREAS, in connection with that certain Contribution Agreement
dated
as of August 14, 2002, as amended from time
to time, the Partners of the
Partnership desire to form the Partnership
and carry on the partnership on the
following terms and conditions.
NOW THEREFORE, in consideration of the mutual covenants herein
contained, and other valuable
consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties
hereto do hereby agree as follows:
ARTICLE 1
DEFINED TERMS
The following definitions shall be for all purposes, unless
otherwise
clearly indicated to the contrary, applied
to the terms used in this Agreement.
"Act" means the Uniform Limited Partnership Act of the State of
California, as it may be amended from time
to time, and any successor to such
statute.
"Additional Unit Number" shall mean, as of any Exchange Date, a
number
determined by (1) dividing 80,000,000 by
(2) the product of (A) the Value of a
REIT Share on the Exchange Date and (B) the
Modified Adjustment Factor, and (3)
subtracting 2,383,080 therefrom; provided
that in no event shall the aggregate
Additional Unit Number be greater than
251,966 or less than zero.
Notwithstanding the foregoing, for purposes
of any Exchange Date occurring on or
after the fifth (5th) anniversary of the
Closing Date, the Additional Unit
Number shall be fixed based on the
foregoing formula using, in lieu of the
amount described in clause (2)(A) above,
the Fifth Anniversary Average Price,
and by using, in lieu of the factor
specified in clause (2)(B) above, the
Modified Adjustment Factor as of such fifth
(5th) anniversary. The Additional
Unit Number with respect to Tendered Units
on any Exchange Date shall mean the
Additional Unit Number, determined as
provided in the preceding sentences on the
relevant Exchange Date for such Tendered
Units, multiplied by a fraction, the
numerator of which is the number of such
Tendered Units and the denominator is
the aggregate number of Units issued to the
Westlake Limited Partner on the
Closing Date.
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"Adjusted Capital Account" means, with respect to any Partner,
such
Partner's Capital Account maintained in
accordance with Section 6.1 hereof, as
of the end of the relevant period, after
giving effect to the following
adjustments:
A. Credit to such Capital Account that portion of any deficit
Capital Account balance that such Partner is obligated to restore
under
the terms of this Agreement or any other document, such Partner's
share
of Minimum Gain and such Partner's share of Partner Nonrecourse
Debt
Minimum Gain.
B. Debit to such Capital Account the items described in
Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) and (6).
The foregoing definition of "Adjusted
Capital Account" is intended to comply
with the provisions of Regulations Sections
1.704-1(b)(2) and 1.704-2, and shall
be interpreted consistently therewith.
"Adjusted Capital Account Deficit" means, with respect to any
Partner,
the deficit balance, if any, in that
Partner's Adjusted Capital Account as of
the end of the relevant period.
"Adjustment Factor" means 1.0; provided, however, that in the
event
Kimco or its successors in interest (i)
declares or pays a dividend on its
outstanding REIT Shares in REIT Shares or
makes a distribution to all holders of
its outstanding REIT Shares in REIT Shares,
(ii) splits or subdivides its
outstanding REIT Shares, (iii) effects a
reverse stock split or otherwise
combines its outstanding REIT Shares into a
smaller number of REIT Shares, or
(iv) issues REIT Shares to all holders of
its outstanding REIT Shares pursuant
to a recapitalization or reclassification
of outstanding REIT Shares, the
Adjustment Factor shall be adjusted by
multiplying the Adjustment Factor
previously in effect by a fraction, (A) the
numerator of which shall be the
number of REIT Shares issued and
outstanding on the record date for such
dividend, distribution, split, subdivision,
reverse split or combination
(assuming for such purposes that such
dividend, distribution, split,
subdivision, reverse split or combination
has occurred as of such time) and (B)
the denominator of which shall be the
actual number of REIT Shares (determined
by assuming for such purposes that such
dividend, distribution, split,
subdivision, reverse split or combination
has not occurred as of such time)
issued and outstanding on the record date
for such dividend, distribution,
split, subdivision, reverse split or
combination; provided, further, that in the
event Kimco or its successor in interest
engages in a Transaction that results
in a successor to Kimco, the Adjustment
Factor shall be adjusted by multiplying
the Adjustment Factor previously in effect
by a fraction, the numerator of which
shall be the Value of a REIT Share of Kimco
immediately prior to the
effectiveness of the Transaction and the
denominator of which shall be the Value
of a REIT Share of the successor of Kimco
immediately prior to the effectiveness
of the Transaction; provided, further, that
the Adjustment Factor shall be
adjusted in the event of a distribution
pursuant to Section 5.1.B(3) and Section
5.1.B(4) of this Agreement by multiplying
the Adjustment Factor previously in
effect by a fraction (X) the numerator of
which shall be the aggregate Fair
Market Value of all Limited Partner
Interests held by the Westlake Limited
Partners and the Westlake Assignees as of
the date of such distribution minus
the aggregate distribution to the Westlake
Limited Partners and the Westlake
Assignees pursuant to Section 5.1.B(3) and
Section 5.1.B(4) hereof on such date
and (Y) the denominator of which shall be
the aggregate Fair Market Value of all
Limited Partner Interests held by the
Westlake Limited Partners and the Westlake
Assignees as of the date of such
distribution (determined immediately prior to
such distribution)(the adjustment resulting
from this proviso, the "Return of
Capital Adjustment"). Any adjustments to
the Adjustment Factor shall become
effective, with respect to any events
described above, on the record date (or if
no record date, the effective date for such
event) or, with respect to an
adjustment to the Adjustment Factor due to
a distribution to the Limited
Partners pursuant to Section 5.1.B(3) and
Section 5.1.B(4) hereof, the earlier
of the date of such distribution or the
date in which the Limited Partners and
the Assignees become entitled to such
distribution (if any).
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"Affiliate" means, with respect to any Person, (i) any Person
directly
or indirectly controlling, controlled by or
under common control with such
Person; (ii) any Person owning or
controlling ten percent (10%) or more of the
outstanding voting interests of such
Person; (iii) any Person of which such
Person owns or controls ten percent (10%)
or more of the voting interests; or
(iv) any officer, director, general partner
or trustee of such Person or of any
Person referred to in clauses (i), (ii),
and (iii) above.
"Agreed Value" means, (i) in the case of the Property, the gross
fair
market value of such property at the time
of contribution as set forth in the
Contribution Agreement and on Exhibit A to
this Agreement, and (ii) in the case
of assets (other than cash) contributed or
deemed contributed to the Partnership
by a Partner, the gross fair market value
thereof listed in Exhibit A to this
Agreement in connection with such
contribution.
"Agreement" means this Agreement of Limited Partnership and the
exhibits thereto (including without
limitation, the Tax Protection Agreement),
as it (or they) may be amended,
supplemented or restated from time to time.
"Appraised Value" means the amount for which the Partnership's
assets
and business would be sold, on an "as is"
basis, with no representations or
warranties, in an arm's-length transaction,
by a willing seller to a willing
buyer, neither being under compulsion to
buy or sell.
"Assignee" means a Person to whom all or a portion of the
economic
interest appurtenant to one (1) or more
Limited Partner Interests has been
transferred in a manner permitted under
this Agreement. "Assignee" shall not
include a Substituted Limited Partner.
"Assumed Liquidation Value" with respect to a Limited
Partnership
Interest means the amount, as reasonably
determined by the General Partner, that
would be received with respect to such
interest if the Partnership sold all of
its assets and business for the Appraised
Value on the Exchange Date and
immediately thereafter the Partnership paid
all liabilities and obligations of
the Partnership, and deducted customary
closing costs that would be associated
with a third party sale, and distributed
the net proceeds to each Partner in
liquidation of the Partnership pursuant to
Section 13.2 hereof.
"Assumed Tax Rate" means the combined maximum marginal
individual
federal and California income tax rates for
the year of the allocation at issue,
adjusted to take into account the
deductibility of state income tax for federal
income tax purposes.
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"Available Cash" means, with respect to any period for which
such
calculation is being made, (a) all cash
revenues and funds received by the
Partnership from whatever source (including
without limitation any loans from
the Kimco Limited Partner and the proceeds
of any Capital Contribution to the
Partnership and excluding the gross
proceeds of any Terminating Capital
Transaction) plus the amount of any
reduction (including, without limitation, a
reduction resulting because the General
Partner determines in its sole and
absolute discretion such amounts are no
longer necessary) in reserves of the
Partnership, which reserves are referred to
in clause (b)(iv) below; less (b)
the sum of the following (except to the
extent taken into account in determining
Terminating Capital Transaction
Proceeds):
(i) all interest, principal and other debt payments
made during such period by the Partnership,
(ii) all cash expenditures (including, without
limitation, capital expenditures with respect to tangible and
intangible assets) made by the Partnership during such period,
(iii) investments in any entity (including, without
limitation, loans made thereto) to the extent that such investments
are
not otherwise described in clauses (b)(i) or (ii); and
(iv) the amount of any increases in reserves
established during such period which the General Partner determines
in
its sole and absolute discretion are necessary or appropriate.
Notwithstanding the foregoing, Available
Cash shall not include any cash
received or reductions in reserves, or take
into account any disbursements made
or reserves established, after commencement
of the dissolution and liquidation
of the Partnership.
"Book-Tax Disparity" means, with respect to the Property, as of
the
date of determination, the difference
between the Book Value of such property
and the adjusted basis of such property for
federal income tax purposes.
"Book Value" means, with respect to the Property or any other
property
contributed to the Partnership in
accordance with this Agreement, the Agreed
Value of such property, and, with respect
to any other Partnership asset, the
asset's adjusted basis for federal income
tax purposes; provided, however, (a)
the Book Value of all Partnership assets
may be adjusted in the event of a
revaluation of Partnership assets in
accordance with Regulations Section
1.704-1(b)(2)(iv)(f) to such fair market
value as shall be determined by the
General Partner in its reasonable judgment;
(b) the Book Value of any
Partnership asset other than cash
distributed to any Partner shall be the fair
market value of such asset on the date of
distribution as determined by the
General Partner in its reasonable judgment
and (c) the Book Value of any
Partnership asset shall be adjusted by the
Depreciation taken into account with
respect to such asset for purposes of
computing Profits and Losses.
"Business Day" means any day except a Saturday, Sunday or other day
on
which commercial banks in New York, New
York or San Francisco, California are
authorized or required by law to close.
"Call Right" has the meaning set forth in Section 8.6.A.1.
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"Call Notice" has the meaning set forth in Section 8.6.A.2.
"Capital Account" has the meaning set forth in Section 6.1.A.
"Capital Contribution" means, with respect to any Partner, the
aggregate amount of cash and other property
which such Partner contributes or is
deemed to contribute to the Partnership in
accordance with this Agreement.
"Cash Payment" has the meaning set forth in Section 8.5.A.1.
"Certificate" means the Certificate of Limited Partnership relating
to
the Partnership to be filed in the office
of the Secretary of State of the State
of California simultaneously with the
effectiveness of this Agreement, as
amended from time to time in accordance
with the terms hereof and the Act.
"Charter" means the Articles of Incorporation of Kimco filed with
the
Maryland State Department of Assessments
and Taxation, as amended, supplemented
or restated from time to time.
"Closing Date" shall have the meaning set forth in the first
paragraph
of this Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Consent" means the consent or approval of a proposed action by
a
Partner given in accordance with Section
14.2 hereof.
"Contribution Agreement" means the Contribution Agreement, dated as
of
August 14, 2002, between KRC Acquisition
Corp., a Maryland corporation, and the
other parties thereto as amended from time
to time.
"Control" means the ability, whether through ownership of
partnership
interests, of voting securities, or
otherwise, to direct the policies and
management of any business entity.
"Delivery Date" has the meaning set forth in Section 8.5.C.
"Depreciation" means, for each fiscal year or other period, an
amount
equal to the depreciation, amortization or
other cost recovery deduction
allowable with respect to an asset for such
year or other period for federal
income tax purposes, except that if the
Book Value of an asset differs from its
adjusted basis for federal income tax
purposes at the beginning of such fiscal
year or other period, Depreciation shall be
adjusted as necessary so as to be an
amount which bears the same ratio to such
beginning Book Value as the federal
income tax depreciation, amortization or
other cost recovery deduction for such
year or other period bears to the beginning
adjusted tax basis; provided,
however, that if the federal income tax
depreciation, amortization or other cost
recovery deduction at the beginning of such
year or other period is zero,
Depreciation for such year or other period
shall be determined with reference to
such beginning Book Value using any
reasonable method approved by the General
Partner that is consistent with the
Partnership's method for making allocations
under Code Section 704(c).
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"Exchange" has the meaning set forth in Section 8.5.A.1.
"Exchange Date" means (a) with respect to Section 8.5, the date
of
receipt by the General Partner of a Notice
of Exchange from a Qualifying Party
pursuant to Section 8.5.A.3; and (b) with
respect to Section 8.6, the date on
which the General Partner exercises the
Call Right, as specified in the Call
Notice pursuant to Section 8.6.A.2.
"Exchange Right" has the meaning set forth in Section 8.5.A.1.
"Exchange Shares" has the meaning set forth in Section 8.5.B.1
hereof.
"Fair Market Value" means, with respect to a Limited Partner
Interest
held by a Westlake Limited Partner, the
Cash Payment that would be paid with
respect to such Limited Partner Interest
upon the exercise of the Exchange Right
with respect thereto (on the date of the
distribution pursuant to Section 5.1.B
giving rise to the determination of Fair
Market Value), assuming the General
Partner did not elect to cause such Limited
Partner Interest to be exchanged for
REIT Shares. The determination of Fair
Market Value shall be made without regard
to the one-year period specified in Section
8.5A.
"Family Member(s)" means, with respect to any natural Person,
such
Person's spouse, the natural or adoptive
parents of such Person or his or her
spouse and the descendants, nephews,
nieces, cousins, in-laws, aunts, uncles,
brothers, sisters (and their respective
spouses) of such Person and any trusts
where such persons are direct or indirect
beneficiaries.
"Fifth Anniversary Average Price" means the average of the daily
market
prices for a REIT Share for twenty (20)
consecutive trading days immediately
preceding the fifth (5th) anniversary of
the Closing Date. The market price for
any such trading day shall be the closing
price on the New York Stock Exchange
(or such other principal exchange on which
REIT Shares are traded) on such day.
"Final adjustment" has the meaning set forth in Section
10.3.B(2).
"General Partner" means Kimwest 186, Inc., a Delaware corporation,
in
its capacity as the general partner of the
Partnership, or its successor as
general partner of the Partnership.
"General Partner Interest" means a Partnership Interest held by
the
General Partner, in its capacity as general
partner.
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"Incapacity" means, (i) as to any individual that is Partner,
death,
total physical disability or entry by a
court of competent jurisdiction
adjudicating him incompetent to manage his
Person or his estate; (ii) as to any
corporation which is a Partner, the filing
of a certificate of dissolution, or
its equivalent, for the corporation or the
revocation of its charter; (iii) as
to any partnership which is a Partner, the
dissolution and commencement of
winding up of the partnership; (iv) as to
any estate which is a Partner, the
distribution by the fiduciary of the
estate's entire interest in the
Partnership; (v) as to any trustee of a
trust which is a Partner, the
termination of the trust (but not the
substitution of a new trustee); or (vi) as
to any Partner, the bankruptcy of such
Partner. For purposes of this definition,
bankruptcy of a Partner shall be deemed to
have occurred when (a) the Partner
commences a voluntary proceeding seeking
liquidation, reorganization or other
relief under any bankruptcy, insolvency or
other similar law now or hereafter in
effect; (b) the Partner is adjudged as
bankrupt or insolvent, or a final order
for relief under any bankruptcy, insolvency
or similar law now or hereafter in
effect has been entered against the Partner
that is or has become nonappealable;
(c) the Partner executes and delivers a
general assignment for the benefit of
the Partner's creditors; (d) the Partner
files an answer or other pleading
admitting or failing to contest the
material allegations of a petition filed
against the Partner in any proceeding filed
against the Partner seeking
liquidation, reorganization or other relief
under any bankruptcy, insolvency or
other similar law now or hereafter in
effect; (e) the Partner seeks, consents to
or acquiesces in the appointment of a
trustee, receiver or liquidator for the
Partner or for all or any substantial part
of the Partner's properties; (f) any
proceeding seeking liquidation,
reorganization or other relief of or against
such Partner under any bankruptcy,
insolvency or other similar law now or
hereafter in effect has not been dismissed
within one hundred twenty (120) days
after the commencement thereof; (g) the
appointment, without the Partner's
consent or acquiescence, of a trustee,
receiver or liquidator for the Partner or
for all or a substantial part of the
Partner's assets has not been vacated or
stayed within ninety (90) days of such
appointment; or (h) an appointment
referred to in clause (g) which has been
stayed is not vacated within ninety
(90) days after the expiration of any such
stay.
"Indemnitee" means any Person made a party to a proceeding by
reason of
(i) his, or its status as the General
Partner, or as a partner, director,
trustee or officer of the Partnership or
the General Partner, or as a
shareholder, director or officer of the
General Partner, Kimco or any other
partner of the General Partner, or (ii) his
or its liabilities, pursuant to a
loan guarantee or otherwise, for any
indebtedness or obligation of the
Partnership (including, without limitation,
any indebtedness or obligation which
the Partnership has assumed or taken assets
subject to).
"Initial Limited
Partners" means the Kimco Limited Partner and Westlake
Development Company, Inc.
"Investment Documents" has the meaning set forth in Section
11.4
hereof.
"IRS" means the Internal Revenue Service.
"Issuance Date" shall be the date that the Tendering Party
receives
either the REIT Shares or cash in
connection with an Exchange.
"Kimco" means Kimco Realty Corporation, a Maryland corporation.
"Limited Partner" shall mean each Initial Limited Partner of
the
Partnership or any Substituted Limited
Partner, in such Person's capacity as a
Limited Partner of the Partnership.
"Limited Partner Interest" means a Partnership Interest of a
Limited
Partner in the Partnership and includes any
and all benefits to which the holder
of such a Partnership Interest may be
entitled, together with all obligations of
such Person to comply with the terms and
provisions of this Agreement.
"Liquidating Event" has the meaning set forth in Section 13.1.
"Liquidator" has the meaning set forth in Section 13.2.
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"Loss" means, for each taxable year or other period, an amount
equal to
the Partnership's items of taxable
deduction and loss for such year or other
period, determined in accordance with Code
Section 703(a) (including all items
of loss or deduction required to be stated
separately under Code Section
703(a)(1)), with the following
adjustments:
(a) Any expenditures of the Partnership described in Section
705(a)(2)(B) of the Code or treated as Section 705(a)(2)(B)
expenditures under Regulation Section 1.704-1(b)(2)(iv)(i), and
not
otherwise taken into account in computing Loss, will be considered
an
item of Loss;
(b) Loss resulting from any disposition of Partnership
property with respect to which gain or loss is recognized for
federal
income tax purposes will be computed by reference to the Book Value
of
such property, notwithstanding that the adjusted tax basis of
such
property may differ from its Book Value;
(c) In lieu of depreciation, amortization and other cost
recovery deductions taken into account in computing taxable income
or
loss, there will be taken into account Depreciation for the
taxable
year or other period;
(d) Any items of deduction and loss specially allocated
pursuant to Section 6.2.D shall not be considered in determining
Loss;
and
(e) Any decrease to Capital Accounts as a result of any
adjustment to the Book Value of Partnership assets pursuant to
Regulation Section 1.704-1(b)(2) (iv)(f) or (g) shall constitute
an
item of Loss.
"Majority Holders" has the meaning set forth in Section
8.6.A.3.
"Minimum Gain" shall have the meaning of such term as set forth
in
Regulations Section 1.704-2(d). A Partner's
share of Minimum Gain (and any net
decrease thereof) at any time shall be
determined in accordance with Regulations
Section 1.704-2(g).
"Modified Adjustment Factor" means the Adjustment Factor
determined
without regard to the effect thereon of any
Return of Capital Adjustment.
"Net Loss" means, for any period, the excess of Losses over
Profits, if
applicable, for such period.
"Net Profit" means, for any period, the excess of Profits over
Losses,
if applicable, for such period.
"Nonrecourse Debt" means a non-recourse liability as defined in
Regulations Section 1.752-1(a).
"Notice of Exchange" has the meaning set forth in Section
8.5.A.
"Outside Date" has the meaning set forth in the Tax Protection
Agreement.
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"Ownership Limit" means the applicable restriction on ownership
of
shares of Kimco imposed under the Charter
(as in effect from time to time).
"Partner" means a General Partner or a Limited Partner, and
"Partners"
means the General Partner and the Limited
Partners collectively.
"Partner Nonrecourse Debt" has the meaning of such term set forth
in
Regulations Section 1.704-2(b)(4).
"Partner Nonrecourse Debt Minimum Gain" has the meaning of such
term
set forth in Regulations Section
1.704-2(i).
"Partner Nonrecourse Deductions" has the meaning of such term set
forth
in Regulations Section 1.704-2(i). The
determination of which Partnership items
constitute Partner Nonrecourse Deductions
shall be made in a manner consistent
with the manner in which Partnership
Nonrecourse Deductions are determined.
"Partner Priority Return" means an amount payable with respect to
each
Unit held of record on the Partner Record
Date equal to (a) the Dividend Factor
(as hereinafter defined), multiplied by (b)
the dividend payable with respect to
one REIT Share to owners of record on the
date corresponding to the applicable
Partner Record Date, multiplied by (c) the
Adjustment Factor as of such date. No
Partner Priority Return shall accrue with
respect to any Unit between Partner
Record Dates. For all record dates on or
before the fifth (5th) anniversary of
the Closing Date, the "Dividend Factor"
will equal 1.105731. For all record
dates after the fifth (5th) anniversary of
the Closing Date, the Dividend Factor
shall equal the number determined in the
following manner: if the product of the
Fifth Anniversary Average Price multiplied
by the Modified Adjustment Factor
(the "Dividend Adjustment Average") is
greater than or equal to $33.57, the
Dividend Factor shall be 1.0; if the
Dividend Adjustment Average is equal to or
less than $30.36, the Dividend Factor shall
be 1.105731; and if the Dividend
Adjustment Average is less than $33.57 and
greater than $30.36, the Dividend
Factor shall equal $33.57 divided by the
Dividend Adjustment Average (rounded to
the nearest millionth).
"Partner Record Date" has the meaning set forth in Section
5.1(A).
"Partnership" means the limited partnership formed under the Act
and
pursuant to this Agreement and any
successor thereto.
"Partnership Interest" means an ownership interest in the
Partnership
and includes any and all benefits to which
the holder of such Partnership
Interest may be entitled, together with all
obligations of such Person to comply
with the terms and provisions of this
Agreement.
"Partnership Year" means the calendar year.
"Percentage Interest" with respect to a Partner means the
amount,
expressed as a percentage, determined by
dividing such Partner's number of Units
divided by the aggregate Units held by all
Partners.
"Permitted Transferee" has the meaning set forth in Section
11.3
hereof.
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"Person" means an individual or a corporation, limited
liability
company, partnership, trust, unincorporated
organization, association or other
entity.
"Primary Registration Statement" has the meaning set forth in
Section
1(a) of the Registration Rights
Agreement.
"Profit" means, for each taxable year or other period, an amount
equal
to the Partnership's items of taxable
income and gain for such year or other
period, determined in accordance with Code
Section 703(a) (including all items
of income and gain required to be stated
separately under Code Section
703(a)(1)), with the following
adjustments:
(a) Any income of the Partnership that is exempt from federal
income tax and not otherwise taken into account in computing
Profit
will be added to Profit;
(b) Gain resulting from any disposition of Partnership
property with respect to which gain or loss is recognized for
federal
income tax purposes will be computed by reference to the Book Value
of
such property, notwithstanding that the adjusted tax basis of
such
property may differ from its Book Value;
(c) Any items specially allocated pursuant to Section 6.2.D
shall not be
considered in determining Profit; and
(d) Any increase to Capital Accounts as a result of any
adjustment to the Book Value of Partnership assets pursuant to
Regulation Section 1.704-1(b)(2)(iv)(f) or (g) shall constitute an
item
of Profit.
"Property" means the approximately 561,566 square foot mixed
use
commercial center known as the Westlake
Shopping Center, located in Daly City,
California or other real property owned by
the Partnership from time to time.
"Purchase Period" has the meaning set forth in Section 11.6.C.
"Purchase Price" has the meaning set forth in Section 11.6.B.
"Qualifying Party" means any Limited Partner.
"Regulations" means the Treasury Regulations promulgated under
the
Code, as such regulations may be amended
from time to time (including
corresponding provisions of succeeding
regulations).
"REIT" means a real estate investment trust qualifying under
Code
Section 856.
"REIT Share" means a share of Kimco's Common Stock, par value $.01
per
share, or a share of the common stock of a
successor to Kimco pursuant to a
Transaction.
"REIT Shares Amount" means, as of any Exchange Date, a number equal
to
(a) the sum of the number of Tendered Units
subject to such exercise plus the
Additional Unit Number, if any, with
respect to such Tendered Units, multiplied
by (b) the Adjustment Factor.
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"Registration Rights Agreement" means that certain Registration
Rights
Agreement, of even date herewith, between
Kimco and Westlake Development
Company, Inc.
"Registration Statement" has the meaning set forth in Section 1(c)
of
the Registration Rights Agreement.
"Related Party" means, with respect to any Person, any other
Person
whose ownership of shares of Kimco's
capital stock would be attributed to the
first such Person under either Code Section
544 (as modified by Code Section
856(h)(1)(B)) or Code Section 318 (as
modified by Code 856(d)(5)).
"Representative" has the meaning set forth in Section 8.6.A.3.
"Residual Percentage Interest" means the ratio in which
distributions
are required to be made pursuant to Section
5.1.B(4).
"Return of Capital Adjustment" has the meaning set forth in the
definition of Adjustment Factor.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and
the
rules and regulations of the SEC
promulgated thereunder. Any reference herein to
a specific section or sections of the
Securities Act shall be deemed to include
a reference to any corresponding provision
of future law.
"Substituted Limited Partner" means a Person who is admitted as
a
Limited Partner to the Partnership from and
after the date of this Agreement
pursuant to Section 11.4.
"Tax Protection Agreement" means that certain agreement entered
into by
and among Kimco, the Partnership, the
General Partner and the Westlake Limited
Partner of even date herewith relating to
certain tax matters, in the form
attached hereto as Exhibit E.
"1031 Transaction" means a transaction treated as a wholly
tax-free
exchange under Code Section 1031.
"Tendered Units" has the meaning set forth in Section 8.5.A.1
hereof.
"Tendering Party" has the meaning set forth in Section 8.5.A.3
hereof.
"Terminating Capital Transaction" means any sale, transfer or
other
disposition of all or substantially all of
the assets of the Partnership or a
related series of transactions that, taken
together, result in the sale or other
disposition of all or substantially all of
the assets of the Partnership, other
than a 1031 Transaction or any other
transaction in which gain or loss is not
recognized by the Partnership for federal
income tax purposes. A Terminating
Capital Transaction may, in the General
Partner's discretion, occur upon the
sale or other disposition of all or
substantially all of the assets of the
Partnership even if the Partnership
receives in exchange consideration that
consists, in whole or in part, of proceeds
other than cash and regardless of
whether such sale or other disposition
results in winding up of the Partnership.
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"Terminating Capital Transaction Proceeds" means the sum of (i) (A)
all
cash, notes or publicly traded securities
received in a Terminating Capital
Transaction, (B) all cash received by the
Partnership in respect of, or from the
sale or disposition by the Partnership of,
non-cash proceeds of a Terminating
Capital Transaction and (C) non-cash
proceeds of a Terminating Capital
Transaction, less (ii) all costs and
expenses of the Partnership relating to
such Terminating Capital Transaction and
all reserves established from the
proceeds of such Terminating Capital
Transaction as are determined by the
General Partner in its sole and absolute
discretion.
"Transaction" has the meaning set forth in Section 11.2 hereof.
"Transfer," when used with respect to all or any portion of a
Partnership Interest, means, subject to the
terms of this definition below, any
transaction in which a Partner assigns all
or any portion of his or its
Partnership Interest to another Person and
includes any sale, assignment,
bequest, conveyance, devise, gift (outright
or in trust), pledge, encumbrance,
hypothecation, mortgage, exchange, transfer
or other disposition or act of
alienation, whether voluntary or
involuntary or by operation of law. When the
term "Transfer" is used in Article 11
hereof, Transfer shall not mean (i) any
Exchange of Limited Partner Interests by
the Partnership or any acquisition of
Tendered Units by the General Partner
pursuant to Section 8.5 hereof or (ii) any
exchange of Limited Partner Interests
pursuant to Section 8.6 or Section 8.7
hereof. The terms "Transferred" and
"Transferring" have correlative meanings.
"Transfer Interests" has the meaning set forth in Section
11.6.A.
"Transfer
Notice" has the meaning set forth in Section 11.6.B.
"Transfer Terms" has the meaning set forth in Section 11.6.B.
"Units" means, collectively, the units of Limited Partner
Interests
issued to the Initial Limited Partners and
the units of General Partnership
Interests issued to the General Partner on
the Closing Date pursuant to the
Contribution Agreement, which units are set
forth on Exhibit A. A transferee of
an undivided portion of a Partner's
Partnership Interest shall succeed to a
proportionate number of the transferring
Partner's Units.
"Unrecovered Capital Amount" means, with respect to any Partner,
the
sum of (i) the aggregate net amount
credited to the Capital Account of such
Partner pursuant to Section 6.1 upon the
making of a Capital Contribution to the
Partnership, less (ii) the aggregate
distributions to such Partner pursuant to
Sections 5.1.B(3) and 5.1.B(4). The
Unrecovered Capital Amount (as so adjusted)
shall be reduced for each Partnership
Interest tendered for redemption by such
Partner, if any, by the Unrecovered Capital
Amount allocable to such Partnership
Interest as of the Issuance Date for such
tender. In addition, the Unrecovered
Capital Amount for each Partner (as so
defined) shall be increased or decreased,
as the case may be, for any transfers of
Partnership Interests (or economic
interests therein) to or by such Partner,
in each case by an amount of the then
Unrecovered Capital Amount allocable to the
Partnership Interests (or economic
interests therein) transferred at the time
of the transfer.
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"Value" means, on any Exchange Date, the average of the daily
market
prices for a REIT Share for twenty (20)
consecutive trading days immediately
preceding the Exchange Date. The market
price for any such trading day shall be
the closing price on the New York Stock
Exchange (or such other principal
exchange on which REIT Shares are traded)
on such day.
"Westlake Assignee" means any Assignee of a Westlake Limited
Partner
that has acquired a Partnership Interest
(or an undivided percentage economic
interest therein) in accordance with this
Agreement and any Assignee of such a
Westlake Assignee that has acquired a
Partnership Interest (or an undivided
percentage economic interest therein) in
accordance with this Agreement.
"Westlake Limited Partner" means Westlake Development Company, Inc.
and
any Westlake Assignee that is a Partner.
Should the Westlake Limited Partner
transfer its Limited Partner Interest in
accordance with this Agreement, any
distributions and allocations among the
Westlake Limited Partner and its
assignees/transferees hereunder thereafter
shall be made according to their
relative Percentage Interests.
ARTICLE 2
ORGANIZATIONAL MATTERS
Section 2.1
Formation.
The Partners hereby form the Partnership. Except as expressly
provided
herein to the contrary, the rights and
obligations of the Partners and the
administration and termination of the
Partnership shall be governed by the Act.
The Partnership Interest of each Partner
shall be personal property for all
purposes.
Section 2.2
Name.
The name of the Partnership is Kimco Westlake L.P. The General
Partner
in its sole and absolute discretion may
change the name of the Partnership at
any time and from time to time and shall
notify the Limited Partners of such
change.
Section 2.3
Registered Office and Agent; Principal Office.
The address of the registered office of the Partnership in the
State of
California and the name and address of the
registered agent for service of
process on the Partnership in the State of
California is Corporation Service
Company, which does business in California
as CSC-Lawyers Incorporating Service.
The principal office of the Partnership
shall be c/o Kimwest 186, Inc., 3333 New
Hyde Park Road, New Hyde Park, NY 11042, or
such other place as the General
Partner may from time to time designate by
notice to the Limited Partners. The
Partnership may maintain offices at such
other place or places within or outside
the State of California as the General
Partner deems advisable.
Section 2.4
Power of Attorney.
A. Subject to Section 7.3 hereof, each Limited Partner hereby
constitutes and appoints the General
Partner, any Liquidator, and authorized
officers and attorneys-in-fact of each, and
each of those acting singly, in each
case with full power of substitution, as
its true and lawful agent and
attorney-in-fact, with full power and
authority in its name, place and stead to:
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(1) execute,
swear to, acknowledge, deliver, file and
record in the appropriate public offices, to the
extent the joinder therein of Limited Partners is
required by the Act or other applicable law, rules or
regulations (a) all certificates, documents and other
instruments (including, without limitation, this
Agreement and the Certificate and all amendments or
restatement thereof) necessary to form, qualify or
continue the existence or qualification of the
Partnership as a limited partnership (or a
partnership in which the limited partners have
limited liability) in the State of California and in
all other jurisdictions in which the Partnership may
or plans to conduct business or own property; (b) all
instruments necessary to reflect any amendment,
change, modification or restatement of this Agreement
in accordance with its terms; (c) all instruments and
documents necessary to reflect the dissolution and
liquidation of the Partnership pursuant to the terms
of this Agreement, including, without limitation, a
certificate of cancellation; and (d) all instruments
relating to the admission, withdrawal, removal or
substitution of any Partner pursuant to, or other
events described in, Article 11 or 12 hereof or
allocation of the Capital Contribution of any Partner
in connection therewith. No person may take any
action pursuant to such power of attorney that (x)
creates liability, or the potential for liability, on
the part of any Limited Partner for indebtedness or
obligations of any other Person (including, without
limitation, the Partnership or the General Partner),
(y) subjects any Limited Partner to service of
process in any jurisdiction other than the state of
its residence or principal place of business and
other than as may be required by applicable law,
rules or regulations or (z) alters the rights,
benefits or obligations of any Limited Partner in
respect of the Partnership (whether under this
Agreement, the Act or otherwise), except pursuant to
amendments to this Agreement made, and other actions
taken, in accordance
with the terms of this
Agreement. The General Partner or the Liquidator, as
applicable, shall provide each Limited Partner with a
copy of each document or other instrument executed on
behalf of such Limited Partner pursuant to the
foregoing power of attorney.
(2) execute,
swear to, seal, acknowledge and file all
ballots, consents, approvals, waivers, certificates
and other instruments appropriate or necessary, in
the sole and absolute discretion of the General
Partner or any Liquidator, to evidence or confirm any
vote, consent or approval of a Limited Partner or to
make, evidence, give, confirm or ratify any,
agreement or other action which is made or given by
the Partners hereunder or is consistent with the
terms of this Agreement or appropriate or necessary,
in the sole and absolute discretion of the General
Partner or any Liquidator, to effectuate the terms or
intent of this Agreement. Nothing contained in this
item (2) shall be construed to limit any vote,
consent or approval rights specifically given to the
Limited Partners elsewhere in this Agreement,
including without limitation, the provisions of
Section 7.3 hereof.
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<PAGE>
Nothing contained herein shall be construed
as authorizing the General Partner
or any Liquidator to amend this Agreement
except in accordance with Article 14
hereof or as may be otherwise expressly
provided for in this Agreement.
B. The foregoing power of attorney is hereby declared to be
irrevocable
and a power coupled with an interest, in
recognition of the fact that each of
the Partners will be relying upon the power
of the General Partner and any
Liquidator to act as contemplated by this
Agreement in any filing or other
action by it on behalf of the Partnership,
and it shall survive and not be
affected by the subsequent Incapacity of
any Limited Partner and the transfer of
all or any portion of such Limited
Partner's Partnership Interest and shall
extend to such Limited Partner's heirs,
successors, assigns and personal
representatives. Each Limited Partner shall
execute and deliver to the General
Partner or the Liquidator, within fifteen
(15) days after receipt of the General
Partner's or Liquidator's request therefor,
such further instruments as the
General Partner or the Liquidator, as the
case may be, requests to confirm
actions taken pursuant to the foregoing
power of attorney.
Section 2.5
Term.
The term of the Partnership commences as of the date of this
Agreement
and shall continue until December 31, 2022,
unless the Partnership is dissolved
sooner pursuant to the provisions of
Article 13 or as otherwise provided by law.
Section 2.6
Certificates Evidencing Partnership Interests.
At the request of a Limited Partner, the General Partner, at
its
option, may issue a certificate summarizing
the terms of such Limited Partner's
interest in the Partnership, including the
number of Partnership Units owned and
the Percentage Interest represented by such
Partnership Units as of the date of
such certificate. Any such certificate (i)
shall be in form and substance as
approved by the General Partner, (ii) shall
not be negotiable and (iii) shall
bear the following legend:
"THIS CERTIFICATE IS NOT NEGOTIABLE. THE PARTNERSHIP UNITS
REPRESENTED
BY THIS CERTIFICATE ARE GOVERNED BY AND TRANSFERABLE ONLY IN
ACCORDANCE
WITH THE PROVISIONS OF THE AGREEMENT OF LIMITED PARTNERSHIP OF
KIMCO
WESTLAKE L.P., AS AMENDED FROM TIME TO TIME."
ARTICLE 3
PURPOSE
Section 3.1
Purpose and Business.
The purpose and nature of the business to be conducted by the
Partnership is (i) to own, lease, operate,
maintain, repair, develop, redevelop,
finance, sell or exchange and otherwise
deal with the Property (or any successor
property(ies)), (ii) to carry on other
business typical for an owner or operator
of real property with respect to the
Property and (iii) to do other things
incident to the other purposes enumerated
in this Section 3.1.
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Section 3.2 Powers.
The Partnership is empowered to do any and all acts and things
necessary, appropriate, proper, advisable,
incidental to or convenient for the
furtherance and accomplishment of the
purposes and business described herein and
for the protection and benefit of the
Partnership, including, without
limitation, borrowing money to finance the
Property and the conduct of the
Partnership's business, subject to any
limitations contained in this Agreement,
provided that the Partnership shall not
take any action which, in the judgment
of the General Partner, in its sole and
absolute discretion, (a) could adversely
affect the ability of Kimco (or any
successor that is a REIT) to continue to
qualify as a REIT, (b) could subject Kimco
(or any successor that is a REIT) or
the General Partner to any additional taxes
under Section 857 or Section 4981 of
the Code, or (c) could violate any law or
regulation of any governmental body or
agency having jurisdiction over Kimco (or
any successor) or the General Partner
or securities issued by Kimco or the
General Partner unless such action (or
inaction) shall have been specifically
consented to by the General Partner in
writing. The Partners hereby consent to any
action deemed by the General Partner
to be reasonably desirable, necessary,
suitable or convenient in order to enable
Kimco (or any successor that is a REIT) to
continue to avoid the consequences
described in clauses (a), (b) or (c) of the
preceding sentence.
The Kimco Limited Partner shall be entitled to receive any
information
that is available to the Company, or its
agents, within five (5) Business Days
of a written request by the Kimco Limited
Partner for such information if such
information is reasonably necessary for
Kimco to determine its compliance with
Sections 856-860 of the Code and the
Regulations promulgated thereunder.
ARTICLE 4
CAPITAL CONTRIBUTIONS
Section 4.1
Capital Contributions of the Partners.
A. The
General Partner has contributed an amount equal to one percent
of the capital of the Partnership as of the
date of this Agreement, as set forth
opposite the General Partner's name on
Exhibit A, and the Limited Partners have
contributed to the capital of the
Partnership cash or property in the net amount
set forth opposite their names on Exhibit
A.
B. Except as provided in Sections 5.1, 8.5 and 10.5, the Partners
shall
have no obligation to make any additional
Capital Contributions, loans or other
advances of funds to the Partnership.
C. No Limited Partner shall have any further personal liability
to
contribute money to, or in respect of, the
liabilities or the obligations of the
Partnership, nor shall any Limited Partner
be personally liable for any
obligations of the Partnership, except as
otherwise provided in this Agreement
or in the Act. No Limited Partner shall be
required to make any contributions to
the capital of the Partnership other than
as expressly provided for in this
Agreement.
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Section 4.2 No
Issuance of Additional Partnership Interests.
The General Partner shall not cause or permit the Partnership to
issue
additional Partnership Interests to the
Partners or other Persons, except as
expressly provided in this Agreement.
Section 4.3
Discretionary Capital Contributions.
The General Partner or the Kimco Limited Partner shall have the
right
to make Capital Contributions to the
Partnership in excess of the amount set
forth in Exhibit A to the extent necessary
as reasonably determined by the
General Partner to meet the Partnership's
capital requirements, and, except as
otherwise provided in Section 8.5.A with
respect to the exercise of an Exchange
Right, any such Capital Contributions shall
be, as of the date contributed,
included in the General Partner's or the
Kimco Limited Partner's Unrecovered
Capital Amount. Limited Partners shall have
no preemptive or similar rights with
respect to any additional Capital
Contributions to the Partnership. In the event
of such contributions, the Partnership
shall issue a number of Units to the
General Partner or the Kimco Limited
Partner, as the case may be, equal to the
amount of such contribution divided by
$33.57.
Section 4.4
Intentionally left blank.
Section 4.5 No
Third Party Beneficiary.
No creditor or other third party having dealings with the
Partnership
shall have the right to enforce the right
or obligation of any Partner to make
Capital Contributions or loans or to pursue
any other right or remedy hereunder
or at law or in equity, it being understood
and agreed that the provisions of
this Agreement shall be solely for the
benefit and may be enforced solely by,
the parties hereto and their respective
successors and assigns. None of the
rights or obligations of the Partners
herein set forth to make Capital
Contributions or loans to the Partnership
shall be deemed an asset of the
Partnership for any purpose by any creditor
or other third party, nor may such
rights or obligations be sold, transferred
or assigned by the Partnership or
pledged or encumbered by the Partnership to
secure any debt or other obligation
of the Partnership or of any of the
Partners. In addition, it is the intent of
the parties hereto that no distribution to
any Limited Partner shall be deemed a
return of money or other property in
violation of the Act. However, if any court
of competent jurisdiction holds that,
notwithstanding the provisions of this
Agreement, any Limited Partner is obligated
to return such money or property,
such obligation shall be the obligation of
such Limited Partner and not of the
General Partner. Without limiting the
generality of the foregoing, a deficit
Capital Account of a Partner shall not be
deemed to be a liability of such
Partner nor an asset or property of the
Partnership.
ARTICLE 5
DISTRIBUTIONS
Section 5.1
Requirement and Characterization of Distributions.
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A. The General Partner shall distribute at least quarterly an
amount
equal to 100% of Available Cash generated
by the Partnership during each
calendar quarter or portion thereof during
which the Partnership is in
existence, except that following a
Terminating Capital Transaction,
distributions shall be made only pursuant
to Section 5.1.B. In the event the
Available Cash in any calendar quarter is
insufficient to make the distribution
required pursuant to Section 5.1.A(1)
below, the Kimco Limited Partner shall
loan the Partnership an amount equal to the
shortfall, which such amount shall
(i) accrue interest at the rate of 9% per
annum, compounded annually, (ii)
together with such interest, shall be
treated as a liability of the Partnership
for all purposes of this Agreement, and
(iii) shall be secured by the Property
(and the General Partner is hereby directed
to take such actions as may be
necessary or desirable in order to perfect
such security interest). Cash
distributions pursuant to this Section 5.1
for a calendar quarter or shorter
period shall be made to the Partners who
are Partners of record on the record
date for the regular quarterly dividend
paid by Kimco to its shareholders for
such quarter ("Partner Record Date") and
such distribution shall be payable to
Partners on or about the payment date for
such dividend for such quarter. Such
distributions shall be made to the
applicable Partners in accordance with the
following order of priority:
(1) First, to
the Westlake Limited Partner until such
Limited Partner has received an amount that, when
aggregated with all previous distributions to such
Limited Partner pursuant to this Section 5.1.A(1), is
equal to (but not in excess of) the greater of (a)
the sum of such Limited Partner's aggregate accrued
Partner Priority Return, or (b) one percent (1%) of
the cumulative distributions by the Partnership
pursuant to Section 5.1.A;
(2) Second, to
the General Partner and the Kimco Limited
Partner in proportion to each such Partners'
aggregate accrued and unpaid Partner Priority Return,
until each such Partner has received an amount that,
when aggregated with all previous distributions to
such Partner pursuant to this Section 5.1.A(2) is
equal to (but not in excess of) the sum of such
Partner's aggregate accrued Partner Priority Return;
(3)
Thereafter, 98.989899% to the Kimco Limited Partner
and 1.010101% to the General Partner.
B. Terminating Capital Transaction Proceeds and any other
amounts
available for distribution following a
Terminating Capital Transaction shall be
distributed within sixty (60) days of
receipt by the Partnership to those
Partners who are Partners on the date of
the distribution of the Terminating
Capital Transaction Proceeds in accordance
with the following order of priority:
(1) First, to
the Westlake Limited Partner until such
Limited Partner has received an amount that, when
aggregated with all previous distributions to such
Limited Partner pursuant to Section 5.1.A(1) and this
Section 5.1.B(1), is equal to (but not in excess of)
the greater of (a) the sum of such Limited Partner's
aggregate accrued Partner Priority Return or (b) one
percent (1%) of the cumulative distributions by the
Partnership pursuant to Sections 5.1.A, this Section
5.1.B(1), and Section 5.1.B(2);
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(2) Second, to
the General Partner and the Kimco Limited
Partner in proportion to each such Partner's'
aggregate accrued and unpaid Partner Priority Return,
until each such Partner has received an amount that,
when aggregated with all previous distributions to
such Partner pursuant to Section 5.1.A(2) and this
Section 5.1.B(2) is equal to (but not in excess of)
the sum of such Partner's aggregate accrued Partner
Priority Return;
(3) Third, to
the Partners in proportion to their
Unrecovered Capital Amounts until the Partners have
received an aggregate amount equal to their aggregate
Unrecovered Capital Amounts; and
(4)
Thereafter, to the Westlake Limited Partner to the
extent of the amount, if any, necessary to cause the
Westlake Limited Partner to have received cumulative
distributions pursuant to Sections 5.1.A and 5.1.B
equal to 1% of the cumulative distributions by the
Partnership pursuant to such sections, and the
balance 1.010101% to the General Partner and
98.989899% the Kimco Limited Partner.
C. If for any taxable year of the Partnership, prior to the
taxable
year in which a Terminating Capital
Transaction occurs, taxable income of the
Partnership is allocated to the Westlake
Limited Partner by reason of Section
6.2.A(4), then the Partnership shall
distribute to the Westlake Limited Partner,
no later than March 15 of the year
following such year, an amount equal to the
product of (1) the excess, if any, of the
taxable income so allocated over the
amount of distributions with respect to
such year by reason of clause (b) of
Section 5.1.A(1), multiplied by (2) the
Assumed Tax Rate. Any distributions
pursuant to this Section 5.1.C shall for
all purposes hereof be considered
advance distributions of, and shall reduce
subsequent distributions with respect
to such Westlake Limited Partner's
Partnership Interest of, amounts described in
Section 5.1.A(1) hereof.
Section 5.2
Amounts Withheld.
All amounts withheld from distributions otherwise payable to a
Partner
pursuant to the Code or any provisions of
any state or local tax law and Section
10.5 hereof with respect to any allocation,
payment or distribution to the
Partners shall be treated as amounts
distributed to the Partners pursuant to
Section 5.1 for all purposes under this
Agreement.
Section 5.3
Distribution of Certain Sale or Borrowing Proceeds.
In the event the Partnership sells property or borrows an amount
of
funds, and if the proceeds of such sales or
borrowings are distributed hereunder
to the General Partner or the Kimco Limited
Partner prior to the Outside Date
and prior to a Terminating Capital
Transaction so as to reduce (A) the net fair
market value of the assets of the
Partnership (including for this purpose, the
net fair market value of any outstanding
loans described below previously made
by the Partnership), as reasonably
determined by the General Partner, below (B)
the lesser of (i) the net book value of the
Property as reasonably determined by
the General Partner immediately prior to
such distribution (determined without
regard to any such net book value
attributable to improvements made to the
Property following the Closing Date) or
(ii) the net fair market value of the
Property as reasonably determined by the
General Partner immediately prior to
such distribution (determined without
regard to the net fair market value of any
improvements to the Property made following
the Closing Date), then the excess
of the amount described in clause (B) over
the amount described in clause (A)
above shall be treated for all purposes as
a demand loan to the General Partner
and the Kimco Limited Partner, which amount
shall (i) accrue interest at the
rate of 9% per annum, compounded annually,
(ii) together with such interest,
shall be treated as an asset of the
Partnership for all purposes of this
Agreement, (iii) provide for joint and
several liability as between the General
Partner and the Kimco Limited Partner, and
(iv) shall be secured by the General
Partner's and the Kimco Limited Partner's
Partnership Interests. For purposes
hereof, "net" means net of liabilities and,
in the case of the net fair market
value and net book value of the Property,
shall include only liabilities secured
by the Property other than liabilities
generating proceeds subject to the
determination then being made under this
Section 5.3; and "book value" means
value as determined for Capital Account
purposes, net of any accumulated
depreciation.
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ARTICLE 6
ALLOCATIONS OF PROFIT AND LOSS
Section 6.1
Capital Accounts.
A. The Partnership shall establish and maintain a separate
capital
account (each, a "Capital Account") for
each Partner in accordance with Code
Section 704 and Regulations Section
1.704-1(b)(2)(iv), which shall have an
initial balance as set forth on Exhibit A.
Subject to the immediately preceding
sentence, the Capital Account of each
Partner shall be credited with (i) any
contributions of cash made by such Partner
to the capital of the Partnership in
accordance with this Agreement, plus the
fair market value of any property
contributed by such Partner to the capital
of the Partnership (net of any
liabilities to which such property is
subject or which are assumed by the
Partnership); plus (ii) the Partner's
allocable share of Net Profit and any
items in the nature of income or gain
specially allocated to such Partner
pursuant to Section 6.2.D and E; plus (iii)
any other increases required by
Regulation Section 1.704-1(b)(2)(iv); and
shall be debited with the sum of: (x)
any distributions of cash made from the
Partnership to such Partner plus the
fair market value of any property
distributed in kind to such Partner (net of
any liabilities to which such property is
subject or which are assumed by such
Partner); plus (y) the Partner's allocable
share of Net Loss and any items in
the nature of expenses or losses specially
allocated to such Partner pursuant to
Section 6.2.D and E; plus(z) any other
decreases required by Regulation Section
1.704-1(b)(2)(iv). Any reference in any
section or subsection section of this
Agreement to the Capital Account of a
Partner shall be deemed to refer to such
Capital Account as the same may be credited
or debited from time to time as set
forth above.
B. The foregoing provisions of this Section 6.1 are intended to
comply
with Regulations Section 1.704-1(b) and
shall be interpreted and applied in a
manner consistent with such Regulations. In
the event the General Partner shall
determine that it is reasonably prudent to
modify the manner in which Capital
Accounts are computed hereunder in order to
comply with such Regulations, the
General Partner may make such modification
if such modification is equitable and
will not cause a material adverse effect on
the amount distributable to any
Partner under the terms of this Agreement
and the General Partner notifies the
Limited Partners in writing of such
modification prior to making such
modification.
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Section 6.2 Net
Profit, Net Loss and Distributive Shares.
A. Net Profit. Subject to Section 6.2.C below, and after giving
effect
to the special allocations, if any,
provided in Sections 6.2.D and E hereof, Net
Profit in each fiscal year or other
relevant period of the Partnership shall be
allocated in the following order:
(1) First, to
each Partner in the same ratio and reverse
order as the cumulative Net Loss allocated to such
Partner
under Section 6.2.B(2) and (3) hereof, until
the cumulative Net Profit allocated to such Partner
under this Section 6.2.A(1) equals the cumulative Net
Loss allocated to such Partner under Section 6.2.B(2)
and (3) hereof;
(2) Second, to
the Westlake Limited Partner until the
excess of the cumulative prior and concurrent
distributions to such Partner pursuant to Sections
5.1.A(1) and 5.1.B(1) over the cumulative amounts of
Net Profit previously allocated to such Limited
Partner pursuant to this Section 6.2.A(2) (taking
into account allocations of Net Loss to such Partner
pursuant to Section 6.2.B which were chargebacks of
such Net Profit) equals zero;
(3) Third, to
the General Partner and the Kimco Limited
Partner pro rata, in proportion to the aggregate
distributions to each such Partner pursuant to
Sections 5.1.A(2) and 5.1.B(2) for all fiscal years
until the excess of the cumulative prior and
concurrent distributions to each such Partner
pursuant to Sections 5.1.A(2) and 5.1.B(2) over the
cumulative amounts of Net Profit previously allocated
to each such Limited Partner pursuant to this Section
6.2.A(3) (taking into account allocations of Net Loss
to such Partners pursuant to Section 6.2.B which were
chargebacks of such Net Profit) equals zero; and
(4)
Thereafter, to the Westlake Limited Partner in an
amount, if any, necessary to cause the Westlake
Limited Partner to have received a cumulative
allocation of Net Profit (net of Net Loss) equal to
1% of the cumulative amount of Net Profit (net of Net
Loss) allocated by the Partnership, and the balance
1.010101%% to the General Partner, 98.989899% to the
Kimco Limited Partner.
B. Net Loss. Subject to Section 6.2.C below, and after giving
effect to
the special allocations, if any, provided
in Sections 6.2.D and E hereof, Net
Loss in each fiscal year or other relevant
period of the Partnership shall be
allocated in the following order:
(1) First, to
each Partner, in the same ratio and reverse
order as Net Profit was allocated to such Partner
pursuant to Sections 6.2.A(2), (3) and (4) until the
cumulative Net Loss allocated to such Partners
pursuant to this 6.2.B(1) equals the cumulative
amount of such Net Profit.
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(2)
Second, to
and among those Partners having positive
balances in their Capital Accounts, in proportion to
and to the extent of, such positive Capital Account
balances; and
(3)
Thereafter, 100% to the General Partner.
C. Net Profit and Net Loss From Terminating Capital
Transaction.
Notwithstanding anything contained in
Sections 6.2.A and B hereof, after giving
effect to the special allocations, if any,
provided in Sections 6.2.D and E
hereof, all items of Profit and Loss
arising from a Terminating Capital
Transaction shall be allocated among the
Partners so as to insure to the maximum
extent possible that, after giving effect
to the allocation of such Profit and
Loss in the Capital Accounts of the
Partners, the Capital Account balance of
each Partner is positive in the amount of
cash that such Partner is entitled to
receive pursuant to Section 5.1.B following
such Terminating Capital
Transaction.
D. Special Allocations. Except as otherwise provided in this
Agreement,
the following special allocations will be
made in the following order and
priority:
(1)
Partnership Minimum Gain Chargeback. Notwithstanding
any other provision of this Article 6, if there is a
net decrease in Minimum Gain during any tax year or
other period for which allocations are made, each
Partner will be specially allocated items of
Partnership income and gain for that period (and, if
necessary, subsequent periods) in an amount equal to
such Partner's share of the net decrease in Minimum
Gain during such tax year or other period determined
in accordance with Regulations Section 1.704-2(g)(2).
Allocations pursuant to the preceding sentence shall
be made in proportion to the respective amounts
required to be allocated to each Partner pursuant
thereto. The items to be so allocated shall be
determined in accordance with Regulations Sections
1.704-2(f)(6) and 1.704-2(j)(2)(i). This Section
6.2.D(1) is intended to comply with the minimum gain
chargeback requirements set forth in Regulations
Section 1.704-2(f) and shall be interpreted
consistently therewith, including the exceptions to
the minimum gain chargeback requirement set forth in
Regulations Sections 1.704-2(f)(2) and (3).
(2) Partner
Nonrecourse Debt Minimum Gain Chargeback.
Notwithstanding any other provision of this Section
6.2 (other than Section 6.2.D(1), which shall be
applied before this Section 6.2.D(2)), if there is a
net decrease in Partner Nonrecourse Debt Minimum Gain
during any tax year or other period for which
allocations are made, each Partner with a share of
Partner Nonrecourse Debt Minimum Gain determined in
accordance with Regulations Section 1.704-2(i)(5)
shall be specially allocated items of Partnership
income and gain for that period (and, if necessary,
subsequent periods) in an amount equal to the
Partner's share of the net decrease in the Partner
Nonrecourse Debt Minimum Gain determined in
accordance with Regulation 1.704-2(i). The items to
be so allocated shall be determined in accordance
with Regulations Sections 1.704-2(i)(4) and
1.704-2(j)(2)(ii). This Section 6.2.D(2) is intended
to comply with the minimum gain chargeback
requirements of Regulations Section 1.704-2(i)(4) and
shall be interpreted consistently therewith,
including the exceptions set forth in Regulations
Section 1.704-(f)(2) and (3) to the extent such
exceptions apply to Regulations Section
1.704-2(i)(4).
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<PAGE>
(3) Qualified
Income Offset. If a Partner unexpectedly
receives any adjustment, allocation or distribution
described in Regulations Section
1.704-1(b)(2)(ii)(d)(4), (5) or (6), respectively,
such Partner will be specially allocated items of
Partnership income and gain (consisting of a pro rata
portion of each item of Partnership income, including
gross income, and gain for the relevant tax year or
other period for which allocations are made) in an
amount and manner sufficient to eliminate, to the
extent required by the Regulations, the Adjusted
Capital Account Deficit of such Partner as quickly as
possible, provided that an allocation pursuant to
this Section 6.2.D(3) shall be made only to the
extent that such Partner would have an Adjusted
Capital Account Deficit after all other allocations
provided for in this Section 6.2 have been made in
the first instance without regard to this Section
6.2.D(3).
(4) Partner
Nonrecourse Deductions. Notwithstanding
anything to the contrary in this Agreement, any
Partner Nonrecourse Deductions for any taxable year
or other period for which allocations are made will
be allocated to the Partner who bears the economic
risk of loss with respect to the liability to which
the Partner Nonrecourse Deductions are attributable
in accordance with Regulations Section 1.704-2(i).
(5) Code
Section 754 Adjustments. To the extent an
adjustment to the adjusted tax basis of any
Partnership asset under Code Section 734(b) or 743(b)
is required to be taken into account in determining
Capital Accounts under Regulations Section
1.704-1(b)(2) (iv)(m), the amount of the adjustment
to the Capital Accounts will be treated as an item of
gain (if the adjustment increases the basis of the
asset) or loss (if the adjustment decreases the basis
of the asset), and the gain or loss will be specially
allocated to the Partners and Assignees in a manner
consistent with the manner in which their Capital
Accounts are required to be adjusted under
Regulations Section 1.704-1(b)(2)(iv)(m).
(6)
Depreciation Recapture. In the event there is any
recapture of depreciation or investment tax credit,
the allocation thereof shall be made among the
Partners in the same proportion as the deduction for
such depreciation or investment tax credit was
allocated.
(7) Interest
In Partnership. Notwithstanding any other
provision of this Agreement, no allocation of Net
Profit or Net Loss (or items thereof) will be made to
a Partner if the allocation would not have "economic
effect" under Regulations Section 1.704-1(b)(2)(ii)
or otherwise would not be in accordance with the
Partner's interest in the Partnership within the
meaning of Regulations Section 1.704-1(b)(3) or
1.704-1(b)(4)(iv).
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<PAGE>
E. Curative Allocations. The allocations set forth in Sections
6.2.D(1)
through (5) and (7) hereof (the "Regulatory
Allocations") are intended to comply
with certain requirements of Regulations
Sections 1.704-1(b) and 1.704-2. The
Regulatory Allocations may not be
consistent with the manner in which the
Partners intend to divide Partnership
distributions. Accordingly, the General
Partner is authorized to further allocate
Profits, Losses, and other items of
income, gain, loss and deduction among the
Partners in an equitable and
reasonable manner so as to prevent the
Regulatory Allocations from causing
differences between the Capital Accounts of
the Partners and the amounts to
which they are entitled under Section 5.1
hereof, but for application of the
Regulatory Allocations. In general, such
reallocation will be accomplished by
specially allocating other Profits, Losses
and other items of income, gain, loss
and deduction, to the extent they exist,
among the Partners so that the net
amount of the Regulatory Allocations and
the special allocations to each
Partners is zero. The General Partner may
accomplish this result in any
equitable and reasonable manner that is
consistent with Code Section 704 and the
related Regulations.
F. Tax Allocations - Code Section 704(c). Notwithstanding
anything
contained in this Agreement to the
contrary, taxable income, gain, loss, and
deduction with respect to any Partnership
property (including, but not limited
to, the Property) that is subject to Code
Section 704(c), the Regulations
thereunder and/or Regulations Section
1.704-1(b)(2)(iv)(f) shall be determined
and allocated among the Partners and
Assignees, and the Capital Accounts of the
Partners shall be determined, in accordance
with such Code Section and/or
Regulations, as the case may be. Any such
allocation shall be made according to
the "traditional method" without curative
allocations under Regulations Section
1.704-3(b). Any nonrecourse debt allocated
to the Partners pursuant to
Regulations Section 1.752-3(a)(3) shall be
allocated to the Partners in
accordance with their Residual Percentage
Interests.
G. Other Allocation Rules. The following rules will apply to
the
calculation and allocation of Profits,
Losses and other items of income, gain,
loss and deduction:
(1) Unless
otherwise determined by the General Partner,
for purposes of determining the Profits, Losses or
any other item of income, gain, loss and deduction
allocable to any period, Net Profits, Net Losses and
other items of income, gain, loss and deduction will
be determined on a daily basis under Code Section 706
and the related Regulations.
(2) Except as
otherwise provided in this Agreement, all
items of Partnership income, gain, loss, deduction,
and other allocations not provided for in this
Agreement will be divided among the Partners in the
same proportions as they share Net Profits and Net
Losses, provided that any credits shall be allocated
in accordance with Regulations Section
1.704-1(b)(4)(ii).
H. Partner Acknowledgment. The Partners agree to be bound by
the
provisions of this Section 6.2 in reporting
their shares of Partnership income,
gain, loss, deduction and other allocations
for income tax purposes.
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<PAGE>
I. Regulatory Compliance. The foregoing provisions of this Section
6.2
relating to the allocation of Net Profits,
Net Losses and other items of income,
gain, loss and deduction for federal income
tax purposes are intended to comply
with Regulations Sections 1.704-1(b) and
1.704-2, and shall be interpreted and
applied in a manner consistent with such
Regulations.
Section 6.3 Negative Capital Accounts. A Limited Partner will not
be
required to restore or to pay to the
Partnership or to any other Partner any
deficit or negative balance which may exist
in the Capital Account of such
Partner at any time, including, without
limitation, upon the winding up of the
Partnership or the transfer of liquidation
of the Partnership or economic
interest therein of such Partner.
Section 6.4 Application to Assignees. If all or a portion of the
Units
of a Partner are transferred in accordance
with the terms of this Agreement, the
Capital Account, Unrecovered Capital
Amount, prior distribution history, and
other attributes of the transferor with
respect to the Partnership allocable or
ascribed to such Units so transferred will
be allocated and ascribed between the
transferor and transferee based on the
respective Percentage Interests allocable
to the Units retained and the Units
transferred. A Permitted Transferee of a
Partner that has become a Partner shall be
deemed to succeed to the rights and
obligations of such Partner under this
Article 6 with respect to the Units
transferred to it.
ARTICLE 7
MANAGEMENT AND OPERATIONS OF BUSINESS
Section 7.1
Management.
A. Except as otherwise expressly provided in this Agreement,
all
management powers over the business and
affairs of the Partnership are and shall
be exclusively vested in the General
Partner and no Limited Partner shall have
any right to participate in or exercise
control or management power over the
business and affairs of the Partnership.
The General Partner may not be removed
by the Limited Partners with or without
cause. In addition to the powers now or
hereafter granted a general partner of a
limited partnership under applicable
law or which are granted to the General
Partner under any other provision of
this Agreement, the General Partner,
subject to Section 7.3 hereof, shall have
full power and authority to do all things
deemed necessary or desirable by it to
conduct the business of the Partnership, to
exercise all powers set forth in
Section 3.2 hereof and to effectuate the
purposes set forth in Section 3.1
hereof, including, without limitation (but
in all cases subject to the terms of
this Agreement, including without
limitation, Section 7.3 hereof):
(1) the making
of any expenditures (including, without
limitation, making prepayments on loans, subject to
prior approval to the extent required by Section 7.3
hereof), the borrowing of money, the assumption or
guarantee of, or other contracting for, indebtedness
and other liabilities, the issuance of evidence of
indebtedness (including the securing of the same by
deed, mortgage, deed of trust or other lien or
encumbrance on the Partnership's assets) and the
incurring of any obligations it deems necessary for
the conduct of the activities of the Partnership;
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<PAGE>
(2) the making
of tax, regulatory and other filings, or
rendering of periodic or other reports to
governmental or other agencies having jurisdiction
over the business or assets of the Partnership;
(3) the
acquisition, disposition, mortgage, pledge,
encumbrance, hypothecation or exchange of any assets
of the Partnership (including the exercise or grant
of any conversion, option, privilege, or subscription
right or other right available in connection with any
assets at any time held by the Partnership), subject
to prior approval to the extent required by Section
7.3 hereof;
(4) the use of
the assets of the Partnership (including,
without limitation, cash on hand) for any purpose
consistent with the terms of this Agreement and on
any terms it sees fit, including, without limitation,
the financing of the conduct of the operations of the
Partnership and the repayment of obligations of the
Partnership;
(5) the
management, operation, leasing, landscaping,
repair, alteration, redevelopment, demolition or
improvement of any real property or improvements
owned by the Partnership;
(6) the
making, negotiation, execution, and performance
of any contracts, conveyances or other instruments
that the General Partner considers useful or
necessary to the conduct of the Partnership's
operations or the implementation of the General
Partner's powers under this Agreement, including
contracting with contractors, developers,
consultants, accountants, legal counsel, other
professional advisors and other agents, whether third
party or Affiliates, and the payment of their
expenses and compensation out of the Partnership's
assets;
(7) the
distribution of Partnership cash or other
Partnership assets in accordance with this Agreement;
(8)
holding,
managing, investing and reinvesting cash and
other assets of the Partnership;
(9) the
collection and receipt of revenues and income of
the Partnership;
(10)
the selection and dismissal of employees of the
Partnership (including, without limitation, employees
having titles such as "president," "vice president,"
"secretary" and "treasurer" of the Partnership), and
agents, outside attorneys, accountants, consultants
and contractors of the Partnership, and the
determination of their compensation and other terms
of employment or hiring;
(11)
the maintenance of such insurance for the benefit of
the Partnership and the Partners as it deems
necessary
or appropriate;
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<PAGE>
(12)
the control of any matters affecting the rights and
obligations of the Partnership, including the
settlement, compromise, submission to arbitration or
any other form of dispute resolution, or abandonment
of, any claim, cause of action, liability, debt or
damages, due or owing to or from the Partnership, the
commencement or defense of suits, legal proceedings,
administrative proceedings, arbitration or other
forms of dispute resolution, and the representation
of the Partnership in all suits or legal proceedings,
administrative proceedings, arbitrations or other
forms of dispute resolution, the incurring of legal
expense, and the indemnification of any Person
against liabilities and contingencies to the extent
permitted by this Agreement;
(13)
the determination of the fair market value of any
Partnership property distributed in kind using such
reasonable method of valuation as the General Partner
may adopt;
(14) the exercise, directly
or indirectly, through any
attorney-in-fact acting under a general or limited
power of attorney, of any right, including the right
to vote, appurtenant to any asset or investment held
by the Partnership; and
(15)
the making, execution and delivery of any and all
deeds, leases, notes, mortgages, deeds of trust,
security agreements, conveyances, contracts,
guarantees, warranties, indemnities, waivers,
releases or legal instruments or agreements in
writing necessary or appropriate, in the judgment of
the General Partner, for the accomplishment of any of
the powers of the General Partner enumerated in this
Agreement.
The foregoing provisions of Section 7.1A do
not constitute a waiver of any
fiduciary duty owed by the General Partner
to the Limited Partners.
B. Each of the Limited Partners agrees that the General Partner
is
authorized to execute, deliver and perform
the above-mentioned agreements and
transactions on behalf of the Partnership
without any further act, approval or
vote of the Partners, to the fullest extent
permitted under the Act or other
applicable law, rule or regulation, subject
to the provisions of this Agreement
(including, without limitation, Section
7.3). The execution, delivery or
performance by the General Partner or the
Partnership of any agreement
authorized or permitted under this
Agreement shall not constitute a breach by
the General Partner of any duty that the
General Partner may owe the Partnership
or the Limited Partners or any other
Persons under this Agreement or of any duty
stated or implied by law or equity so long
as such execution, delivery or
performance has been undertaken by the
General Partner in good faith.
C. At all times from and after the date hereof, the General Partner
may
cause the Partnership to establish and
maintain at any and all times working
capital accounts and other cash or similar
balances in such amounts as the
General Partner, in its sole and absolute
discretion, deems appropriate and
reasonable from time to time.
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<PAGE>
D. Prior to the taking of any action under this Agreement that, in
the
good faith judgment of the General Partner,
may have a material adverse tax
effect on the Westlake Limited partner, the
General Partner shall consult with
the Westlake Limited Partner regarding such
action. Except as provided in this
Agreement and in the Tax Protection
Agreement, in exercising its authority under
this Agreement, following the Outside Date
the General Partner may, but shall be
under no obligation to, take into account
the tax consequences to any Partner of
any action taken by it. Except as otherwise
provided in the Tax Protection
Agreement, the General Partner and the
Partnership shall not have liability to a
Limited Partner under any circumstances as
a result of an income tax liability
incurred by such Limited Partner as a
result of an action (or inaction) by the
General Partner taken pursuant to its
authority under this Agreement.
Section 7.2
Certificate of Limited Partnership.
The General Partner shall file, simultaneously herewith, a
Certificate
of Limited Partnership with the Secretary
of State of California as required by
the Act, indicating that the General
Partner is a general partner of the
Partnership. The General Partner shall use
all reasonable efforts to cause to be
filed such other certificates or documents
as may be reasonable and necessary or
appropriate for the formation,
continuation, qualification and operation of a
limited partnership (or a partnership in
which the limited partners have limited
liability) in the State of California, any
other state or any other
jurisdiction, in which the Partnership may
elect to do business or own property.
The General Partner shall file amendments
to and restatements of the Certificate
and do all of the things to maintain the
Partnership as a limited partnership
(or a partnership in which the limited
partners have limited liability) under
the laws of the State of California and
each other state and each other
jurisdiction in which the Partnership may
elect to do business or own property.
The General Partner shall after filing,
deliver a copy of the Certificate and
any amendment thereto to each Limited
Partner.
Section 7.3
Restrictions on General Partner Authority.
A. Exhibit E hereto sets forth a Tax Protection Agreement that
is
designed to indemnify certain Persons for
taxes and related amounts in the event
of certain actions taken by, or with
respect to, the Partnership within the
periods specified therein. Nothing herein
is intended to alter or modify the
terms of the Tax Protection Agreement.
B. Intentionally left blank.
C. The General Partner shall not, without the prior Consent of
Westlake
Limited Partners holding Percentage
Interests equal to 75% of the Percentage
Interests held by the Westlake Limited in
the aggregate, undertake or have the
authority to do or undertake, on behalf of
the Partnership, any of the following
actions or enter into any transaction which
would have the effect of such
transactions:
(i) except as provided in Section 14.1 or as reasonably
necessary to reflect the admission, substitution, termination
or
withdrawal of Partners pursuant to Article 4, Article 11 or Article
12
hereof, amend or modify this Agreement in any material respect
or
terminate this Agreement;
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<PAGE>
(ii) make a general assignment for the benefit of creditors or
appoint or acquiesce in the appointment of a custodian, receiver
or
trustee for all or any part of the assets of the Partnership;
(iii) institute any proceeding for bankruptcy on behalf of the
Partnership;
(iv) confess a judgment against the Partnership;
(v) approve or acquiesce to the Transfer of the Partnership
Interest of the General Partner to any Person other than the
Partnership or an Affiliate of Kimco;
(vi) admit into the Partnership any Additional or Substitute
General Partner; or
(vii) admit into the Partnership any Additional Limited
Partner except in accordance with Section 4.3 and Article 11
hereof.
D. The General Partner may not take any action in contravention of
an
express prohibition or limitation of this
Agreement, including, without
limitation:
(i) take any action that would make it impossible to carry on
the ordinary business of the Partnership, except as otherwise
provided
in this Agreement;
(ii) possess Partnership property, or assign any rights in
specific Partnership property, for other than a Partnership
purpose
except as otherwise provided in this Agreement;
(iii) perform any act that would subject a Limited Partner to
liability as a General Partner in any jurisdiction or any other
liability expect as provided herein or under the Act; or
(iv) enter into any contract, mortgage, loan or other
agreement that expressly prohibits or restricts, or has the effect
of
prohibiting or restricting, the ability of (a) the General Partner
or
the Partnership from satisfying its obligations under Section
8.6
hereof in full or (b) a Partner from exercising its rights to
an
Exchange in full, except, in either case, with the written consent
of
such Partner affected by the prohibition.
E. No third party shall have any obligation to investigate whether
the
General Partner shall have sought or
received any consent required from the
Limited Partners as provided above and may
conclusively rely on any action by
the General Partner as being authorized and
binding on Partnership.
F. Except as provided in this Section 7.3, and Sections 11.2,
13.1,
13.2, and 14.1, the General Partner shall
have complete discretion with regard
to the management of the affairs of the
Partnership; provided, however, that
notwithstanding anything to the contrary
contained in this Agreement, nothing in
this Agreement shall constitute a waiver of
any fiduciary duty owed by the
General Partner to the Limited
Partners.
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<PAGE>
Section 7.4
Reimbursement of the General Partner.
A. As provided in this Section 7.4 and elsewhere in this
Agreement
(including the provisions of Articles 5 and
6 regarding distributions, payments,
and allocations to which it may be
entitled), the General Partner shall be
compensated for its services rendered to
the Partnership including without
limitation, a redevelopment/construction
fee equal to five percent (5%) or
costs.
B. The General Partner shall be reimbursed on a monthly basis, or
such
other basis as it may determine in its sole
and absolute discretion, for all
out-of-pocket expenses and compensation
paid to Persons who are not Affiliates
of the General Partner and, subject to the
terms of Section 7.5, to Affiliates,
in each case that it incurs relating to the
ownership and operation of, or for
the benefit of, the Partnership.
Section 7.5
Contracts with Affiliates.
A. The General Partner or any of its Affiliates may, transfer or
convey
any property to, or purchase any property
from, the Partnership, directly or
indirectly, or enter into any other
transaction with the Partnership on terms
and conditions that are fair and reasonable
for the Partnership.
B. The General Partner and its Affiliates and their employees
may
perform services for the Partnership,
including without limitation, property
management, construction management,
leasing, legal, accounting, sale and other
services with respect to the Property, and
may compensate and reimburse such
Persons for such services determined on an
arm's-length fair market value basis.
The General Partner may not be removed by
Owner or its successors, with or
without cause.
Section 7.6
Indemnification.
A. To the fullest extent permitted by California law, the
Partnership
shall indemnify each Indemnitee from and
against any and all losses, claims,
damages, liabilities, joint or several,
expenses (including, without limitation,
reasonable attorneys fees and other
reasonable legal fees and expenses),
judgments, fines, settlements, and other
amounts arising from any and all
claims, demands, actions, suits or
proceedings, civil, criminal, administrative
or investigative, that relate to the
Partnership or its business, affairs,
properties or operations, or to
indebtedness or obligations of the Partnership
for which the Indemnitees is or is alleged
to be liable, in which such
Indemnitee may be involved, or is
threatened to be involved, as a party or
otherwise, unless it is established by a
court of competent jurisdiction and all
appeals relating thereto have been fully
completed or the applicable appeal
periods have expired that: (i) the act or
omission of the Indemnitee was
material to the matter giving rise to the
proceedings and either was committed
in intentional bad faith or was the result
of active and deliberate dishonesty;
(ii) the Indemnitee actually received an
improper and unpermitted personal
benefit in money, property or services; or
(iii) in the case of any criminal
proceeding, the Indemnitee had reasonable
cause to believe that the act or
omission was unlawful. Without limitation,
the
