AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT OF HIGHLAND FINANCIAL PARTNERS, L.P. April 17, 2007

EXHIBIT 3.2

AMENDED AND RESTATED

LIMITED PARTNERSHIP AGREEMENT

OF

HIGHLAND FINANCIAL PARTNERS, L.P.

April 17, 2007

TABLE OF CONTENTS

AMENDED AND RESTATED

LIMITED PARTNERSHIP AGREEMENT
OF
HIGHLAND FINANCIAL PARTNERS, L.P.

          This AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT (the “ Agreement ”) of HIGHLAND FINANCIAL PARTNERS, L.P. (the “ Partnership ”) dated as of April 17, 2007 is entered into by and among HFP GP, LLC, a Delaware limited liability company, as the General Partner, together with any other Persons who have or will become Partners in the Partnership or parties hereto as provided herein. This Agreement amends and restates in its entirety the Amended and Restated Limited Partnership Agreement of the Partnership, dated as of February 3, 2006.

RECITAL

          The Partners have formed the Partnership as a limited partnership under the laws of the State of Delaware and desire to enter into a written agreement, in accordance with the provisions of the Delaware Revised Uniform Limited Partnership Act and any successor statute, as amended from time to time (the “Act”), governing the affairs of the Partnership and the conduct of its business.

ARTICLE I

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 Delaware Revised Uniform Limited Partnership Act, as it may be amended from time to time, and any successor to such statute.

          “ Additional Limited Partner ” means a Person admitted to the Partnership as a Limited Partner pursuant to Sections 4.02 and 15.02 hereof and who is shown as such on the books and records of the Partnership.

          “ Adjusted Capital Account Deficit ” means, with respect to any Partner, the deficit balance, if any, in such Partner’s Capital Account as of the end of the relevant Allocation Year, after giving effect to the following adjustments:

               (i) credit to such Capital Account any amounts which such Partner is deemed to be obligated to restore pursuant to the penultimate sentence in each of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); and

               (ii) debit to such Capital Account the items described in Regulations Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5) and 1.704-1(b)(2)(ii)(d)(6).

The foregoing definition of “ Adjusted Capital Account Deficit ” is intended to comply with the provisions of Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

          “ Affiliate ” of any Partner means the Manager and any Subsidiary, and with respect to any Person, any Person directly or indirectly controlling, controlled by or under common control with such Person; provided , however , that for purposes hereof no Person to whom the Manager or any of its Affiliates provides any services shall be considered to be controlled by or under common control with the Manager or any such Affiliate unless the Manager and its Affiliates own a controlling economic interest in the equity interests of such Persons. For purposes of this definition, the terms “controlling,” “controlled by” or “under common control with” shall mean the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise, or the power to elect at least fifty percent (50%) of the directors, managers, general partners, trustees or Persons exercising similar authority with respect to such Person.

          “ Agreement ” means this Amended and Restated Agreement of Limited Partnership, as it may be amended, supplemented or restated from time to time.

          “ Allocation Year ” means (i) the period commencing on the Operation Commencement Date and ending on December 31, 2006, (ii) any subsequent twelve (12)-month period commencing on January 1 and ending on December 31, or (iii) any portion of the period described in clause (i) or (ii) above for which the Partnership is required to allocate Net Income, Net Losses and other items of Partnership income, gain, loss or deduction pursuant to Article VI hereof.

          “ Applicable Listing Rules ” means the applicable rules, if any, of the principal United States securities exchange or the Nasdaq National Market, as the case may be, on which the Common Units are listed or quoted as the case may be.

          “ Assignee ” means a Person to whom one or more Partnership Units have been transferred in a manner permitted under this Agreement, but who has not become a Substituted Limited Partner, and who has the rights set forth in Section 13.05.

          “ Beneficial Owner ” has the meaning ascribed to such term in Rule 13d 3 of the rules promulgated under the Exchange Act.

          “ Benefit Plan Investor ” means (i) an employee benefit plan (as defined by Section 3(3) of ERISA), subject to Title I of ERISA; (ii) a plan defined in Section 4975(e)(1) of the Code, subject to Section 4975 of the Code; (iii) an entity whose underlying assets include the assets of any plan described in clause (i) or (ii) by reason of the plan’s investment in such entity (including, without limitation, as applicable, an insurance company general account); or (iv) an entity that otherwise constitutes a “benefit plan investor” under the Plan Assets Regulation.

          “ Board of Directors ” means the Board of Directors of the Partnership.

          “ Business Day ” means any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York or Delaware are authorized or required by law, regulation or executive order to close.

          “ Capital Account ” means, with respect to any Partner, the Capital Account established and maintained for such Partner by the Partnership in accordance with the following provisions:

               (i) to each Partner’s Capital Account there shall be credited (A) such Partner’s Capital Contributions, and (B) such Partner’s distributive share of Net Income and any items in the nature of income or gain which are specially allocated pursuant to Section 6.03 or Section 6.04 hereof;

               (ii) to each Partner’s Capital Account there shall be debited (A) the amount of money and the Gross Asset Value of any property (other than money) distributed to such Partner (net of any liabilities secured by such distributed property that such Partner assumes or takes subject to) pursuant to any provision of this Agreement, and (B) such Partner’s distributive share of Net Losses and any items in the nature of expenses or losses which are specially allocated pursuant to Section 6.03 or Section 6.04 hereof;

               (iii) in the event Partnership Interests are transferred in accordance with the terms of this Agreement, the transferee shall succeed to the Capital Account of the transferor to the extent it relates to the transferred Partnership Interests, including where the transfer causes a termination of the Partnership under Section 708(b)(1)(B) of the Code, in which case the Capital Account of the transferee and the Capital Accounts of the other holders of Partnership Interests in the terminated Partnership shall carry over to the new Partnership that is formed, for U.S. federal income tax purposes, as a result of the termination; and

               (iv) in determining the amount of any liability for purposes of subparagraphs (i) and (ii) above, there shall be taken into account Section 752(c) of the Code and any other applicable provisions of the Code and the Regulations.

The foregoing provisions and the other provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Regulations Section 1.704-1(b) and shall be interpreted and applied in a manner consistent with such Regulations. In the event the General Partner shall determine that it is prudent to modify the manner in which the Capital Accounts or any debits or credits thereto (including, without limitation, debits or credits relating to liabilities which are secured by contributed or distributed property or which are assumed by the Partnership or any Partners) are computed in order to comply with such Regulations, the General Partner may make such modification, provided that it is not likely to have a material effect on the amounts distributed to any Person pursuant to Article V or Article XVI hereof, including upon the dissolution of the Partnership. The General Partner also shall (i) make any adjustments that are necessary or appropriate to maintain equality among the Capital Accounts of the Partners and the amount of capital reflected on the Partnership’s balance sheet, as computed for book purposes, in accordance with Regulations Section 1.704-1(b)(2)(iv)(q), and (ii) make any appropriate modifications in the event unanticipated events might otherwise cause this Agreement not to comply with Regulations Section 1.704-1(b).

          “ Capital Contributions ” means, with respect to any Partner, the amount of money and the initial Gross Asset Value of any property (other than money) contributed to the Partnership (net of any liabilities secured by such contributed property that the Partnership assumes or takes subject to) with respect to the Partnership Interests of the Partnership held or subscribed for by such Partner.

          “ Certificate of Limited Partnership ” means the Certificate of Limited Partnership relating to the Partnership filed in the office of the Delaware Secretary of State, as amended from time to time in accordance with the terms hereof and the Act.

          “ Chairman ” means the director appointed or nominated and elected, as the case may be, Chairman of the Board of Directors of the Partnership, in accordance with Section 10.01, with such powers and duties as are set forth in Section 10.04 hereof.

          “ Charitable Beneficiary ” has the meaning specified in Section 14.03.

          “ Code ” means the Internal Revenue Code of 1986, as amended and in effect from time to time, as interpreted by applicable Regulations. Any reference herein to a specific section or sections of the Code shall be deemed to include a reference to any corresponding provision of law in effect in the future.

          “ Common Unit ” means a Partnership Unit which is designated as a Common Unit and which has the rights, preferences and other privileges designated herein in respect of Common Unitholders. For avoidance of doubt, “Common Units” shall include Restricted Common Units.

           “Common Unit Option ” means the right to purchase Common Units as set forth in the Equity Plan.

          “ Common Unitholder ” means a Partner that holds Common Units.

          “ Common Units-in-Trust ” means Common Units automatically transferred to a trustee of a trust for the benefit of one or more Charitable Beneficiaries.

          “ Contribution Agreement ” means the Contribution Agreement, dated as of December 31, 2006, by and between Highland Capital Management, L.P., a Delaware limited partnership, and Highland Capital Special Allocation LLC, a Delaware limited liability company.

          “ Depreciation ” means, for any Allocation Year, an amount equal to the depreciation, amortization, or other cost recovery deduction allowable for U.S. federal income tax purposes with respect to an asset for such period, except that if the Gross Asset Value of an asset differs from its adjusted basis for U.S. federal income tax purposes at the beginning of such period, Depreciation shall be an amount which bears the same ratio to such beginning Gross Asset Value as the U.S. federal income tax depreciation, amortization, or other cost recovery deduction for such period bears to such beginning adjusted tax basis; provided , however , that if the adjusted basis for U.S. federal income tax purposes of an asset at the beginning of such period is zero, Depreciation shall be determined with reference to such beginning Gross Asset Value using any reasonable method selected by the General Partner.

          “ Effective Date ” means the date hereof.

          “ Equity Plan ” means any equity compensation plan established by the Partnership.

          “ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended.

          “ Exchange Act ” shall mean the Securities Exchange Act of 1934, as amended.

          “ Fiscal Quarter ” means (i) the period commencing on the Operation Commencement Date and ending on March 31, 2006, (ii) any subsequent three (3)-month period commencing on each of July 1, October 1, January 1 and April 1 and ending on the last date before the next such date, or (iii) the period commencing on the immediately preceding January 1, April 1, July 1 or October 1, as the case may be, and ending on the date on which all Property is distributed to the Partners pursuant to Article XVI hereof.

          “ Fiscal Year ” means (i) the period commencing on the Operation Commencement Date and ending on December 31, 2006, (ii) any subsequent twelve (12)-month period commencing on January 1 and ending on December 31, or (iii) the period commencing on the immediately preceding January 1 and ending on the date on which all Property is distributed to the Partners pursuant to Article XVI hereof.

          “ GAAP ” means generally accepted accounting principles, as applied in the United States from time to time.

          “ General Partner ” means the general partner of the Partnership, or any of its successors in their respective capacity as general partner of the Partnership.

          “ General Partner Interest ” means a Partnership Interest held by the General Partner, in its capacity as general partner. The General Partner Interest shall be expressed as a number of Partnership Units

          “ General Partner Unit ” means a Partnership Unit which is designated as a General Partner Unit. Each General Partner Unit shall rank equally with, and shall otherwise be equivalent to, the Common Units with regard to (i) allocations of items of Partnership income, gain, loss, deduction and credit; (ii) rights to share in Partnership distributions; and (iii) rights upon dissolution and liquidation of the Partnership. Each General Partner Unit shall otherwise have its pro rata share of the rights, preferences and other privileges designated herein in respect of the General Partner.

          “ Gross Asset Value ” means, with respect to any asset, the asset’s adjusted basis for U.S. federal income tax purposes, except as follows:

               (i) the initial Gross Asset Value of any asset contributed by a Partner to the Partnership shall be the gross fair market value of such asset, as determined by the General Partner;

               (ii) the Gross Asset Values of all Partnership assets shall be adjusted to equal their respective gross fair market values (taking Section 7701(g) of the Code into account), as determined by the General Partner as of the following times: (A) the acquisition of an additional interest in the Partnership by any new or existing Partner in exchange for more than a

de minimis Capital Contribution; (B) the distribution by the Partnership to a Partner of more than a de minimis amount of Partnership Property as consideration for an interest in the Partnership; (C) the grant of an interest in the Partnership (other than a de minimis interest) as consideration for the provision of services to or for the benefit of the Partnership by an existing Partner acting in a Partner capacity or by a new Partner acting in a Partner capacity or in anticipation of being a Partner (or any other adjustments as may be permitted or required by regulations promulgated under Section 704 of the Code); and (D) the liquidation of the Partnership within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g); provided that an adjustment described in clauses (A), (B) and (C) of this subparagraph (ii) shall be made only if the General Partner reasonably determines that such adjustment is necessary to reflect the relative economic interests of the Partners in the Partnership;

               (iii) the Gross Asset Value of any item of Partnership assets distributed to any Partner shall be adjusted to equal the gross fair market value of such asset on the date of distribution, as determined by the General Partner; and

               (iv) the Gross Asset Values of Partnership assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Section 734(b) or Section 743(b) of the Code, but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to Regulations Section 1.704-1(b)(2)(iv)(m) and subparagraph (vi) of the definition of “Net Income” and “Net Loss”; provided , however , that Gross Asset Values shall not be adjusted pursuant to this subparagraph (iv) to the extent that an adjustment pursuant to subparagraph (ii) is required in connection with a transaction that would otherwise result in an adjustment pursuant to this subparagraph (iv).

If the Gross Asset Value of an asset has been determined or adjusted pursuant to subparagraph (ii) or (iv), such Gross Asset Value shall thereafter be adjusted by Depreciation taken into account with respect to such asset for purposes of computing Net Income and Net Losses.

          “ Operation Commencement Date ” means February 3, 2006.

          “ IRS ” means the U.S. Internal Revenue Service.

          “ Incapacity ” or “ Incapacitated ” means, (i) as to any individual Partner, death, total physical disability or entry by a court of competent jurisdiction adjudicating him incompetent to manage his or her Person or 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 and nonappealable order for relief under any bankruptcy, insolvency or similar law now or hereafter in effect has been entered against the Partner; (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 of the nature described in clause (b) above; (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 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.

          “ Incentive Allocation ” shall have the meaning set forth in Section 5.04.A hereof.

          “ Indemnitee ” means any Person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Partnership) by reason of the fact that the Person is or was a General Partner, officer, employee or of the Partnership, or is or was serving at the request of the Partnership as a director, officer, employee or agent of another entity.

          “ Independent Director ” means a member of the Board of Directors who (i) is not an officer or employee of the Partnership, the General Partner or the Manager or any of their respective Affiliates, (ii) is not an Affiliate of the General Partner or the Manager, and (iii) at any time after the initial public offering of Common Units, who complies with the independence requirements under the Exchange Act, the Rules and Regulations and the Applicable Listing Rules.

          “ Lien ” means any lien, security interest, mortgage, deed of trust, charge, claim, encumbrance, pledge, option, right of first offer or first refusal and any other right or interest of others of any kind or nature, actual or contingent, or other similar encumbrance of any nature whatsoever.

          “ Limited Partner ” means any Person admitted as a Limited Partner, Special Limited Partner, Additional Limited Partner, or Substituted Limited Partner and named on the books and records of the Partnership as a Limited Partner of the Partnership.

          “ Limited Partner Interest ” means a Partnership Interest of a Limited Partner in the Partnership representing a fractional part of the Partnership Interests of all Partners in their capacity as Limited Partners and includes any and all benefits to which the holder of such a Partnership Interest may be entitled, as provided in this Agreement, together with all obligations of such Person to comply with the terms and provisions of this Agreement. A Limited Partner Interest shall be expressed as a number of Partnership Units. For avoidance of doubt, “Limited Partner Interest” shall include the Partnership Interest associated with Restricted Units and Special Units.

          “ Liquidating Event ” has the meaning set forth in Section 16.01.

          “ Liquidator ” has the meaning set forth in Section 16.02.

          “ Management Agreement ” means the Amended and Restated Management Agreement, dated as of April 17, 2007, as amended, supplemented or restated from time to time, between the Partnership and each of its Subsidiaries and the Manager.

          “ Manager ” means Highland Capital Management, L.P. or any Person appointed as a substitute Manager of the Partnership.

          “ Mandatory Exchange ” has the meaning ascribed to such term in Section 4.01A.

          “ Market Price ” means the last reported sales price reported on the New York Stock Exchange of the Common Units on the trading day immediately preceding the relevant date, or if the Common Units are not then traded on the New York Stock Exchange, the last reported sales price of the Common Units on the trading day immediately preceding the relevant date as reported on any exchange or quotation system over which the Common Units may be traded, or if the Common Units are not then traded over any exchange or quotation system, then the market price of the Common Units on the relevant date as determined in good faith by the Board of Directors.

          “ Merger Agreement ” has the meaning assigned to such term in Section 19.01.

          “ Net Income ” and “ Net Losses ” mean, for each Allocation Year, an amount equal to the Partnership’s taxable income or loss for such Allocation Year, determined in accordance with Section 703(a) of the Code (for this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant to Section 703(a)(1) of the Code shall be included in taxable income or loss), with the following adjustments (without duplication):

               (i) any income of the Partnership that is exempt from U.S. federal income tax and not otherwise taken into account in computing Net Income and Net Losses

pursuant to this definition of “Net Income” and “Net Losses” shall be added to such taxable income or loss;

               (ii) any expenditures of the Partnership described in Section 705(a)(2)(B) of the Code or treated as Section 705(a)(2)(B) of the Code expenditures pursuant to Regulations Section 1.704-1(b)(2)(iv)(i) and not otherwise taken into account in computing Net Income or Net Losses pursuant to this definition of “Net Income” and “Net Losses” shall be subtracted from such taxable income or loss;

               (iii) in the event the Gross Asset Value of any Partnership asset is adjusted pursuant to subparagraph (ii) or (iii) of the definition of Gross Asset Value, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the Gross Asset Value of the asset) or an item of loss (if the adjustment decreases the Gross Asset Value of the asset) from the disposition of such asset and shall be taken into account for purposes of computing Net Income or Net Losses;

               (iv) gain or loss resulting from any disposition of Property with respect to which gain or loss is recognized for U.S. federal income tax purposes shall be computed by reference to the Gross Asset Value of the Property disposed of, notwithstanding that the adjusted tax basis of such Property differs from its Gross Asset Value;

               (v) to the extent an adjustment to the adjusted tax basis of any Partnership asset pursuant to Section 734(b) of the Code is required, pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital Accounts as a result of a distribution other than in liquidation of a Partner’s interest in the Partnership, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis) from the disposition of such asset and shall be taken into account for purposes of computing Net Income or Net Losses; and

               (vi) notwithstanding any other provision of this definition, any items which are specially allocated pursuant to Section 6.03 or Section 6.04 hereof shall not be taken into account in computing Net Income or Net Losses. The amounts of the items of Partnership income, gain, loss or deduction available to be specially allocated pursuant to Sections 6.03 and 6.04 hereof shall be determined by applying rules analogous to those set forth in subparagraphs (i) through (v) above.

          “ Nonrecourse Deductions ” has the meaning set forth in Regulations Section 1.704-2(b)(1).

          “ Nonrecourse Liability ” has the meaning set forth in Regulations Section 1.704-2(b)(3).

          “ Ownership Trust ” has the meaning specified in Section 14.02.

          “ Ownership Trustee ” has the meaning specified in Section 14.03.

          “ 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 set forth in Regulations Section 1.704-2(b)(4).

          “ Partner Nonrecourse Debt Minimum Gain ” means an amount, with respect to each Partner Nonrecourse Debt, equal to the Partnership Minimum Gain that would result if such Partner Nonrecourse Debt were treated as a Nonrecourse Liability, determined in accordance with Regulations Section 1.704-2(i)(3).

          “ Partner Nonrecourse Deductions ” has the meaning set forth in Regulations Sections 1.704-2(i)(1) and 1.704-2(i)(2).

          “ Partnership ” means the limited partnership formed under the Act and pursuant to this Agreement, as it may be amended and/or restated, and any successor thereto.

          “ Partnership Interest ” means an ownership interest in the Partnership by either a Limited Partner or the General Partner and includes any and all benefits to which the holder of such a Partnership Interest may be entitled as provided in this Agreement, together with all obligations of such Person to comply with the terms and provisions of this Agreement. Each Partnership Interest shall be expressed as a number of Partnership Units. For avoidance of doubt, “Partnership Interest” shall include interests associated with Restricted Common Units and Special Units.

          “ Partnership Minimum Gain ” has the meaning set forth in Regulations Sections 1.704-2(b)(2) and 1.704-2(d).

          “ Partnership Record Date ” means the record date established by the Board of Directors for the distribution of Net Income pursuant to Section 5.01 hereof. Partnership Record Date shall also mean the record date established by the Board of Directors for the determination of Partners entitled to vote at any annual or special meeting of the Partnership.

          “ Partnership Unit ” or “ Unit ” means a fractional, undivided share of the Partnership Interests of any class of Partners issued pursuant to Sections 4.01 or 4.02. The

ownership of Partnership Units shall be evidenced by such form of certificate for units as the Board of Directors adopts from time to time unless the Board of Directors determines that any Partnership Units shall be uncertificated securities.

          “ Percentage Interest ” means, as to a Partner, its percentage interest as a Common Unitholder, a General Partner, or a holder of Restricted Common Units (to the extent determined by the General Partner pursuant to Section 4.02B) determined by dividing the Common Units, General Partner Units or Restricted Common Units owned by such Partner by the total number of (i) Common Units, (ii) General Partner Units, and (iii) Restricted Common Units (to the extent determined by the General Partner pursuant to Section 4.02B) then outstanding, as applicable.

          “ Person ” means any individual, corporation, partnership, joint venture, trust, limited liability company, unincorporated organization or government or any agency or political subdivision thereof or any other entity.

          “ Plan Asset Regulation ” means Section 3(42) of ERISA and the plan asset regulation promulgated by the Department of Labor under ERISA at 29 C.F.R. 2510.3-101.

          “ Plan of Conversion ” has the meaning assigned to such term in Section 19.01.

          “ Property ” means all real and personal property acquired by the Partnership, including cash, and any improvements thereto, and shall include both tangible and intangible property.

          “ Purported Beneficial Transferee ” means, with respect to any event which results in a transfer to an Ownership Trust, as provided in Sections 14.02 or 14.03, the Purported Record Transferee, unless the Purported Record Transferee would have acquired or owned Limited Partner Interests for another Person who is the beneficial transferee or owner of such interests, in which case the Purported Beneficial Transferee shall be such Person.

          “ Purported Record Transferee ” means, with respect to any Transfer or other event which results in a Transfer to an Ownership Trust, as provided in Sections 14.02 or 14.03, the record holder of the Common Units if such transfer had been valid under Section 14.02.

          “ Regulations ” means the Income Tax Regulations promulgated under the Code, as such regulations may be amended from time to time (including corresponding provisions of succeeding regulations).

          “ Regulatory Allocations ” has the meaning set forth in Section 6.04 hereof.

          “ Rules and Regulations ” means the rules and regulations under the Securities Act or the Exchange Act.

          “ Restricted Common Unit ” has the meaning set forth in Section 4.03 hereof.

          “ Secretary ” means the Secretary of the Partnership, with such powers and duties as set forth in Section 10.05 hereof.

          “ Securities Act ” means the Securities Act of 1933.

          “ Special Limited Partner ” means any Person admitted as a Special Limited Partner and named on the books and records of the Partnership in such Person’s capacity as a Special Limited Partner of the Partnership.

          “ Special Limited Partner Interest ” means a Partnership Interest of a Special Limited Partner in the Partnership representing a fractional part of the Partnership Interests of all Partners in their capacity as Special Limited Partners and includes any and all benefits to which the holder of such a Partnership Interest may be entitled, as provided in this Agreement, together with all obligations of such Person to comply with the terms and provisions of this Agreement. A Special Limited Partner Interest shall be expressed as a number of Special Units.

          “ Special Unit ” means a Limited Partner Interest represented by a fractional, undivided share of the Partnership Interests of all Partners issued hereunder which is designated as a Special Unit and which has the rights, preferences and other privileges designated.

          “ Special Unit Holder ” means the Manager, or such other Affiliate of the Manager as may be designated by the Manager, that holds the Special Unit.

          “ Subsidiary ” means, with respect to any Person, any corporation, partnership or other entity of which a majority of (i) the voting power of the voting equity securities; or (ii) the outstanding equity interests, is owned, directly or indirectly, by such Person.

          “ Substituted Limited Partner ” means a Person who is admitted as a Limited Partner to the Partnership pursuant to Section 13.05 in place of and with all the rights of a Limited Partner and named as a Limited Partner on the books and records of the Partnership.

          “ Surviving Business Entity ” has the meaning assigned to such term in Section 19.02B.

          “ Transfer Agent ” means such bank, trust company or other Person (including the General Partner or one of its Affiliates) as shall be appointed from time to time by the Partnership to act as registrar and transfer agent for the Common Units; provided, that if no Transfer Agent is specifically designated for any other Partnership Unit, the General Partner shall act in such capacity.

          “ Terminating Capital Transaction ” means any sale 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.

          “ Transfer , “ when used in this Agreement with respect to a Partnership Unit, shall be deemed to refer to any transaction or series of transactions by which a Partner purports to sell, gift, assign, exchange, pledge, encumber, hypothecate or dispose, by operation of law or otherwise, all or any part of its Partner Interest to another Person, whether directly or indirectly. An agreement or commitment to do any of the foregoing shall also constitute a Transfer.

          “ 25% Threshold ” means ownership by Benefit Plan Investors, in the aggregate, of twenty-five (25%) percent or more of the value of the Common Units (calculated by excluding the value of any interest held by any person, other than a Benefit Plan Investor, who has discretionary authority or control with respect to the assets of the Partnership or any person who provides investment advice to the Partnership for a fee (direct or indirect) with respect to such assets, or any Affiliate of such person).

ARTICLE II

ORGANIZATIONAL MATTERS

            Section 2.01 Formation .

          The Partnership is a limited partnership organized on January 20, 2006 pursuant to the Certificate of Limited Partnership as filed with the Secretary of the State of Delaware pursuant to the provisions of the Act. The Partners hereby agree to continue the Partnership upon the terms and conditions set forth in this Agreement. 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 2.02 Name .

          The name of the Partnership shall be “Highland Financial Partners, L.P.” The General Partner may change the name of the Partnership at any time and from time to time and

shall notify the Limited Partners of such change in the next regular communication to the Limited Partners.

            Section 2.03 Registered Office and Agent; Principal Office.

          The address of the registered office of the Partnership in the State of Delaware and the name and address of the registered agent for service of process on the Partnership in the State of Delaware is The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801. The principal office of the Partnership shall be Two Galleria Tower, 13455 Noel Road, Suite 1300, Dallas, Texas 75240, 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 Delaware as the General Partner deems advisable.

            Section 2.04 Power of Attorney .

          A. Each Limited Partner and each Assignee hereby constitutes and appoints the General Partner, any other Person acting as Liquidator, and their duly authorized officers and attorneys-in-fact, 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:

Nothing contained herein shall be construed as authorizing the General Partner or any Liquidator to amend this Agreement except in accordance with Article XVII 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 or Assignee and the Transfer of all or any portion of such Limited Partner’s or Assignee’s Partnership Units and shall extend to such Limited Partner’s or Assignee’s heirs, successors, assigns and personal representatives. Each such Limited Partner or Assignee hereby agrees to be bound by any representation made by the General Partner or any Liquidator, acting in good faith pursuant to such power of attorney, and each such Limited Partner or Assignee hereby waives any and all defenses which may be available to contest, negate or disaffirm the action of the General Partner or any Liquidator, taken in good faith under such power of attorney. Each Limited Partner or Assignee 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 designation, powers of attorney and other instruments as the General Partner or the Liquidator, as the case may be, deems necessary to effectuate this Agreement and the purposes of the Partnership.

            Section 2.05 Term .

          The term of the Partnership commenced on January 20, 2006, the date on which the Certificate of Limited Partnership was filed in the office of the Secretary of State of the State of Delaware, and shall continue in perpetuity, unless the Partnership is dissolved sooner pursuant to the provisions of Article XVI or as otherwise provided by law.

ARTICLE III

PURPOSE

            Section 3.01 Purpose and Business .

          The purpose and nature of the business to be conducted by the Partnership is (i) to own structured finance subsidiaries commonly known as collateralized debt obligation issuers, (ii) to own a minority economic stake and a majority voting stake in a real estate investment trust subsidiary; (iii) to own a minority interest in Highland Financial Corporation; (iv) to own majority and minority equity interests in other subsidiaries; (v) to enter into any partnership, joint venture, limited liability company or other similar arrangement to engage in any of the foregoing or to own interests in any entity (including any corporation) engaged, directly or indirectly, in any of the foregoing; (vi) to conduct any other business that may be lawfully conducted by a limited partnership organized pursuant to the Act and to engage in such activities as the Board of Directors may approve; and (vii) to do anything necessary or incidental to the foregoing; provided , however , that such activities shall be limited to and conducted in such a manner as to not require the Partnership to be registered as an investment company under the Investment Company Act of 1940 or to cause the Partnership to be treated as an association or publicly traded partnership taxable as a corporation for U.S. federal income tax purposes.

            Section 3.02 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, full power and authority, directly or through its ownership interest in subsidiaries or other entities, to enter into, perform and carry out contracts of any kind, borrow money and issue evidences of indebtedness whether or not secured by mortgage, deed of trust, pledge or other lien, acquire, own, manage, sell, transfer and dispose of real-estate related securities, real estate-related loans and other real estate-related assets, acquire, own, manage, improve and develop real property, and lease, sell, transfer and dispose of real property; provided , however , that the Partnership shall not take, or refrain from taking, any action which, in the judgment of the Board of Directors could violate any law or regulation of any governmental body or agency having jurisdiction over the Partnership or its securities, unless such action (or inaction) shall have been specifically approved by the Board of Directors.

ARTICLE IV

ISSUANCES OF ADDITIONAL PARTNERSHIP INTERESTS, RESTRICTED COMMON UNITS, AND OPTIONS

            Section 4.01 Issuances of Additional Partnership Interests .

          The Board of Directors is authorized to cause the Partnership to issue additional Common Units or other Partnership Interests for any Partnership purpose, from time to time, to such Persons for such consideration and on such terms and conditions as the Board of Directors shall determine, without the approval of any Limited Partners. Each additional Partnership Interest authorized to be issued by the Partnership pursuant to this Section 4.01 may be issued in one or more classes, or one or more series of any of such classes, with such designations, preferences and relative, participating, optional or other special rights, powers and duties, including rights, powers and duties senior to any outstanding Limited Partner Interests issued on or before the Effective Date and any other Common Units and other Partnership Interests issued thereafter, all as shall be determined by the Board of Directors, subject to Delaware law, including, without limitation, (i) the allocations of items of Partnership income, gain, loss, deduction and credit to each such class or series of Partnership Interests; (ii) the right of each such class or series of Partnership Interests to share in Partnership distributions; and (iii) the rights of each such class or series of Partnership Interests upon dissolution and liquidation of the Partnership. In the event that the Partnership issues Partnership Interests pursuant to Section 4.01, the General Partner shall make such amendments or revisions to this Agreement (without any requirement of receiving approval of any the Limited Partners other than as may be required by the terms of any class or series of Limited Partner Interest hereinafter created) including but not limited to the revisions described in Section 5.04 and 8.05 hereof, as the Board of Directors deems necessary to reflect the issuance of such additional Partnership Interests and the special rights, powers and duties associated therewith. Unless specifically determined otherwise by the Board of Directors, any Partnership Interest issued after the Effective Date shall represent Common Units.

            Section 4.02 Restricted Common Units .

          A. The Board of Directors is hereby authorized to issue Common Units in consideration of services provided to the Partnership which are subject to forfeiture in accordance with the terms of an Equity Plan (“ Restricted Common Units ”).

          B. Characterization of Distributions and Allocations to Holders of Restricted Common Units . Subject to the Equity Plan, holders of Restricted Common Units will be entitled to receive distributions in the same manner as each other class of Commons Units. The character of any allocation, distribution or payment made to holders of Restricted Common Units for U.S. federal income tax purposes shall be as determined by the General Partner in its sole discretion, taking into account, among other things, whether a holder of Restricted Common Units made an election under Section 83(b) of the Code (or any other applicable elections under the Code). Such allocations, distributions or payments may be characterized for U.S. federal

income tax purposes as compensation for services, guaranteed payments under Section 707(c) of the Code, allocations pursuant to Article VI hereof, or otherwise as determined by the General Partner under applicable law.

            Section 4.03 Options .

          The Board of Directors is hereby authorized to issue Options pursuant to the Equity Plan.

ARTICLE V

DISTRIBUTIONS

            Section 5.01 Requirement and Characterization of Distributions .

          A. Except as otherwise provided in Section 5.01.B, the General Partner shall distribute on approximately a quarterly basis to the General Partner and to holders of Restricted Common Units and Common Unitholders who are Partners on the Partnership Record Date therefore in accordance with their respective Percentage Interests on such Partnership Record Date, such amount of the net income (determined in accordance with GAAP) of the Partnership or amounts in excess of such net income, as the Board of Directors of the Partnership shall determine. Unless otherwise expressly provided for herein or in an agreement at the time a new class of Partnership Interests is created in accordance with Article IV hereof, no Partnership Interest shall be entitled to a distribution in preference to any other Partnership Interest.

          B. Notwithstanding the provisions of Section 5.01.A above or any other provision of this Agreement, if for any period with respect to which a distribution is to be made (a “ Distribution Period ”), a “Newly Issued Unit” (as such term is defined below) is outstanding on the Partnership Record Date for such Distribution Period, there shall not be distributed in respect of such Newly Issued Unit the amount (the “ Full Distribution Amount ”) that would otherwise be distributed in respect of such Unit in accordance with Section 5.01.A. Rather, the General Partner shall cause to be distributed with respect to each such Newly Issued Unit an amount equal to the Full Distribution Amount multiplied by a fraction, the numerator of which equals the number of days such Newly Issued Unit has been outstanding during the Distribution Period and the denominator of which equals the total number of days in such Distribution Period. Any net income (determined in accordance with GAAP) not distributed to the holders of Units by operation of this Section 5.01.B shall be retained by the Partnership. The Board of Directors may, in its sole discretion, with respect to any distribution, waive the application of this Section 5.01.B such that a Newly Issued Unit shall receive the Full Distribution Amount (or any greater amount than would otherwise be received under this Section 5.01.B but not in excess of the Full Distribution Amount). For purposes of this Section 5.01.B, the term “ Newly Issued Unit ” shall mean, with respect to any Distribution Period, a Common Unit issued during such Distribution Period, except that the term “Newly Issued Unit” shall not include (unless otherwise provided by

the Board of Directors) any Common Units issued in connection with a split on or unit dividend of the Common Units.

            Section 5.02 Amounts Withheld .

          The Partnership is authorized to withhold from dividends and other payments or allocations to any Partner or Assignee, and to pay over to any U.S. federal, state and local government or any foreign government, any amounts required to be so withheld pursuant to the Code or any provisions of any other U.S. federal, state or local law or any foreign law, and shall allocate any such amounts to the Partner or Assignees with respect to which such amounts were withheld.

          All amounts withheld in accordance with this Section 5.02 or pursuant to the Code or any provision of any state, local or foreign tax law with respect to any payment, dividend or other distribution or allocation to any Partner or Assignee shall be treated as amounts paid to such Partner or Assignee for all purposes of this Agreement.

            Section 5.03 Distributions Upon Liquidation .

          Proceeds from a Terminating Capital Transaction and any other cash received or reductions in reserves made after commencement of the liquidation of the Partnership shall be distributed to the Partners in accordance with Section 16.02.

            Section 5.04 Incentive Allocation .

          A. The Special Unit Holder shall be entitled to receive a distribution with respect to an incentive allocation (the “ Incentive Allocation ”) in respect of the Special Units from the Partnership, calculated as prescribed in Annex 1 attached hereto.

          B. It is intended that Incentive Allocations to the Special Unit Holder shall be treated as an interest in partnership net income and not as a guaranteed payment for services pursuant to Section 707(c) of the Code.

          C. The Special Unit Holder may, with the consent of the Board of Directors, including a majority of the Independent Directors, Transfer all or any portion of the Special Units to any Person(s) who is an Affiliate of the Manager, and each such Person shall be admitted as a Special Limited Partner. Notwithstanding any other provision of this Agreement, the Board of Directors shall have the sole and complete discretion, without the consent of the Limited Partners, to amend Annex 1 attached hereto in any manner to reflect changes that the Board of Directors determines do not adversely affect the Limited Partners in any material respect.

ARTICLE VI

ALLOCATIONS

            Section 6.01 Net Income .

          A. After giving effect to the special allocations set forth in Sections 6.01(B), 6.03 and 6.04 below, Net Income for each Allocation Year shall be allocated among the Common Units, the General Partner Unit and, to the extent determined by the General Partner pursuant to Section 4.02B above, among the Restricted Common Units, in proportion to their Percentage Interests.

          B. For each Allocation Year of the Partnership, the Partnership shall allocate to the Special Limited Partner Net Income in an amount equal to the amount the Special Limited Partner is entitled to receive under Section 5.04, without regard to whether all or some portion of such distribution is made to the Special Limited Partner in that Allocation Year or in a later Allocation Year; provided , however , that Net Income allocated pursuant to this Section 6.01B for an Allocation Year shall not be in excess of such recipient’s entitlement, as determined under Section 5.04

            Section 6.02 Net Losses .

          After giving effect to the special allocations set forth in Sections 6.03 and 6.04 and subject to Section 6.05, Net Losses for any Allocation Year shall be allocated among the Common Units, General Partner Unit and to the extent determined by the General Partner pursuant to Section 4.02B above, to holders of Restricted Common Units, in proportion to their Percentage Interests.

          Section 6.03 Special Allocations . The following special allocations shall be made in the following order:

          A. Minimum Gain Chargeback . Except as otherwise provided in Regulations Section 1.704-2(f), notwithstanding any other provision of this Article VI, if there is a net decrease in Partnership Minimum Gain during any Allocation Year, each Partner shall be specially allocated items of Partnership income and gain for such Allocation Year (and, if necessary, subsequent Allocation Years) in an amount equal to such Partner’s share of the net decrease in Partnership Minimum Gain, determined in accordance with Regulations Section 1.704-2(g). Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to 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). This Section 6.03(A) is intended to comply with the minimum gain chargeback requirement in Regulations Section 1.704-2(f) and shall be interpreted consistently therewith.

          B. Partner Minimum Gain Chargeback . Except as otherwise provided in Regulations Section 1.704-2(i)(4), notwithstanding any other provision of this Article VI, if there is a net decrease in Partner Nonrecourse Debt Minimum Gain attributable to a Partner Nonrecourse Debt during any Allocation Year, each Partner who has a share of the Partner Nonrecourse Debt Minimum Gain attributable to such Partner Nonrecourse Debt, determined in accordance with Regulations Section 1.704-2(i)(5), shall be specially allocated items of Partnership income and gain for such Allocation Year (and, if necessary, subsequent Allocation Years) in an amount equal to such Partner’s share of the net decrease in Partner Nonrecourse Debt, determined in accordance with Regulations Section 1.704-2(i)(4). Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Partner pursuant thereto. 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). This Section 6.03(b) is intended to comply with the minimum gain chargeback requirement in Regulations Section 1.704-2(i)(4) and shall be interpreted consistently therewith.

          C. Qualified Income Offset . In the event any Partner unexpectedly receives any adjustments, allocations or distributions described in Regulations Section 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5) or 1.704-1(b)(2)(ii)(d)(6), items of Partnership income and gain shall be specially allocated to such Partner in an amount and manner sufficient to eliminate, to the extent required by the Regulations, the Adjusted Capital Account Deficit of the Partner as quickly as possible, provided that an allocation pursuant to this Section 6.03(C) shall be made only if and to the extent that the Partner would have an Adjusted Capital Account Deficit after all other allocations provided for in this Article VI have been tentatively made as if this Section 6.03(C) were not in this Agreement.

          D. Gross Income Allocation . In the event any Partner has a deficit Capital Account at the end of any Allocation Year which is in excess of the sum of the amount such Partner is obligated to restore pursuant to the penultimate sentence of each of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5), each such Partner shall be specially allocated items of Partnership income and gain in the amount of such excess as quickly as possible, provided that an allocation pursuant to this Section 6.03(D) shall be made only if and to the extent that such Partner would have a deficit Capital Account in excess of such sum after all other allocations provided for in this Article VI have been made as if Section 6.03(C) hereof and this Section 6.03(d) were not in this Agreement.

          E. Nonrecourse Deductions . Nonrecourse Deductions for any Allocation Year shall be specially allocated to the Partners in proportion to their respective Percentage Interests.

          F. Partner Nonrecourse Deductions . Any Partner Nonrecourse Deductions for any Allocation Year shall be specially allocated to the Partner who bears the economic risk of loss with respect to the Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions are attributable in accordance with Regulations Section 1.704-2(i)(1).

          G. Section 754 Adjustments . To the extent an adjustment to the adjusted tax basis of any Partnership asset, pursuant to Section 734(b) or Section 743(b) of the Code, is required, pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(2) or 1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital Accounts as the result of a distribution to a Partner in complete liquidation of such Partner’s interest in the Partnership, the amount of such adjustment to Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis) and such gain or loss shall be specially allocated to the Partners in accordance with their interests in the Partnership in the event Regulations Section 1.704-1(b)(2)(iv)(m)(2) applies or to the Partner to whom such distribution was made in the event Regulations Section 1.704-1(b)(2)(iv)(m)(4) applies.

            Section 6.04 Curative Allocations .

          The allocations set forth in Sections 6.03.A, 6.03.B, 6.03.C, 6.03.D, 6.03.E, 6.03.F, 6.03.G and 6.05 hereof (the “ Regulatory Allocations ”) are intended to comply with certain requirements of the Regulations. It is the intent of the Partners that, to the extent possible, all Regulatory Allocations shall be offset either with other Regulatory Allocations or with special allocations of other items of Partnership income, gain, loss or deduction pursuant to this Section 6.04. Therefore, notwithstanding any other provision of this Article VI (other than the Regulatory Allocations), the General Partner shall make such offsetting special allocations of Partnership income, gain, loss or deduction in whatever manner it determines appropriate so that, after such offsetting allocations are made, each Partner’s Capital Account balance is, to the extent possible, equal to the Capital Account balance such Partner would have had if the Regulatory Allocations were not part of this Agreement and all Partnership items were allocated pursuant to Sections 6.01, 6.02 and 6.03D hereof.

            Section 6.05 Loss Limitation .

          Net Losses allocated pursuant to Section 6.02 hereof shall not exceed the maximum amount of Net Losses that can be allocated without causing any Partner to have an Adjusted Capital Account Deficit at the end of any Allocation Year. In the event some but not all of the Partners would have Adjusted Capital Account Deficits as a consequence of an allocation of Net Losses pursuant to Section 6.02 hereof, the limitation set forth in this Section 6.05 shall be applied on a Partner-by-Partner basis, and Net Losses not allocable to any Partner as a result of such limitation shall be allocated to the other Partners in accordance with the positive balances in such Partners’ Capital Accounts so as to allocate the maximum permissible Net Losses to each Partner under Regulations Section 1.704-1(b)(2)(ii)(d).

            Section 6.06 Other Allocation Rules .

          A. For purposes of determining the Net Income and Net Losses or any other items allocable to any period, Net Income, Net Losses, and any other such items shall be allocated among the Partners as determined by the General Partner using any method and convention permissible under Section 706 of the Code and the Regulations thereunder; provided , however , that the General Partner may adopt such other methods and conventions relating to

allocations as it determines are necessary or appropriate. Without limiting the foregoing, the Partners hereby agree that the General Partner may utilize the method described in Regulations Section 1.706-1(c)(2)(ii).

          B. The Partners are aware of the income tax consequences of the allocations made by this Article VI and hereby agree to be bound by the provisions of this Article VI in reporting their shares of Partnership income and loss for income tax purposes.

          C. Solely for purposes of determining a Partner’s proportionate share of the “excess nonrecourse liabilities” of the Partnership within the meaning of Regulations Section 1.752-3(a)(3), the Partners’ interests in Partnership net income are in proportion to their Percentage Interests.

          D. To the extent permitted by Regulations Section 1.704-2(h)(3), the General Partner shall endeavor to treat distributions as having been made from the proceeds of a Nonrecourse Liability or a Partner Nonrecourse Debt only to the extent that such distributions would cause or increase an Adjusted Capital Account Deficit for any Partner.

          E. The General Partner may apply certain methods, assumptions and conventions relating to allocations of items of income, gain, deduction, loss and credit in a manner intended to comply with applicable provisions of the Code and Regulations and to allocate such items in a manner that reflects the beneficial share of Partnership items of Partners (and holders of Common Units).

            Section 6.07 Tax Allocations: Section 704(c) of the Code .

          In accordance with the principles of Section 704(c) of the Code and the Regulations thereunder, income, gain, loss and deduction with respect to any Property contributed to the capital of the Partnership shall, solely for tax purposes, be allocated among the Partners so as to take account of any variation between the adjusted basis of such Property to the Partnership for U.S. federal income tax purposes and its initial Gross Asset Value (computed in accordance with the definition of Gross Asset Value) using a method, selected in the discretion of the General Partner in accordance with Regulations Section 1.704-3.

          In the event the Gross Asset Value of any Partnership asset is adjusted pursuant to subparagraph (ii) of the definition of Gross Asset Value, subsequent allocations of income, gain, loss and deduction with respect to such asset shall take account of any variation between the adjusted basis of such asset for U.S. federal income tax purposes and its Gross Asset Value in accordance with the principles of Code Section 704(c) and the Regulations thereunder.

          Any elections or other decisions relating to such allocations shall be made by the Partnership in any manner that reasonably reflects the purpose and intention of this Agreement, which includes, without limitation, the purpose and intention that each Common Unit shall have the same economic interest in the Partnership and the same tax characteristics and shall otherwise be identical in all respects. Allocations pursuant to this Section 6.07 are solely for purposes of U.S. federal, state and local taxes and shall not affect, or in any way be taken into account in computing, any Partner’s Capital Account or share of Net Income, Net Losses, other items or distributions pursuant to any provision of this Agreement.

            Section 6.08 Amendment of Article VI .

          Notwithstanding any other provision of this Agreement, upon or prior to the issuance of additional Common Units, the General Partner shall have the sole and complete discretion, without the approval of any other Partner, to amend any provision of this Article VI in any manner, as is necessary, appropriate or advisable to comply with any current or future provisions of the Code or the Regulations, provided the economic arrangements between the Partners are not materially affected.

ARTICLE VII

MANAGEMENT AND OPERATIONS OF BUSINESS

            Section 7.01 Management .

          A. Except as otherwise expressly provided in this Agreement, all management powers over the business and affairs of the Partnership are 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. 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 9.01 hereof, shall have full power and authority to do all things deemed necessary or desirable to conduct the business of the Partnership, to exercise all powers set forth in Section 3.02 hereof and to effectuate the purpose set forth in Section 3.01 hereof, including without limitation, those matters set forth below in this Section 7.01. The General Partner hereby delegates to the Board of Directors of the Partnership all of its management powers hereunder, other than those expressly reserved in Section 9.01 hereto:

          B. Each of the Limited Partners agrees that the officers of the Partnership or such other person (including the Manager) as the Board of Directors may appoint, 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, notwithstanding any other provision of this Agreement (except as provided in Section 7.03), the Act or any applicable law, rule or regulation, to the fullest extent permitted under the Act or other applicable law, rule or regulation.

          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, deems appropriate and reasonable from time to time.

          D. The General Partner shall not have any greater fiduciary or similar duty to the Partnership or any of the Partners than an officer of a corporation for profit organized under the General Business Corporation Law of Delaware would have to such corporation or its shareholders.

          E. In exercising its authority under this Agreement, 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. 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 and in accordance with the terms of Section 7.03. The Limited Partners expressly acknowledge that the General Partner is acting on behalf of the Partnership and its Partners collectively.

          F. The General Partner may not be removed by the Limited Partners with or without cause.

            Section 7.02 Certificate of Limited Partnership .

          The General Partner has previously filed the Certificate of Limited Partnership with the Secretary of State of the State of Delaware as required by the Act. 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 Delaware and any other state, or the District of Columbia, in which the Partnership may elect to do business or own property. To the extent that such action is determined by the General Partner to be reasonable and necessary or appropriate, the General Partner shall file amendments to and restatements of the Certificate of Limited Partnership 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 Delaware and each other state, or the District of Columbia, in which the Partnership may elect to do business or own property. Subject to the terms of Section 8.04A(4) hereof, the General Partner shall not be required, before or after filing, to deliver or mail a copy of the Certificate of Limited Partnership or any amendment thereto to any Limited Partner.

            Section 7.03 Restrictions on Authority .

          A. Notwithstanding anything to the contrary contained herein, without the consent and approval of the holders of at least a majority of the outstanding Common Units, the Partnership shall not take any action (other than amendments to this Agreement in accordance with the provisions of this Agreement), even if approved by the General Partners and/or the Board of Directors as applicable, that a Delaware business corporation could not take without first obtaining the approval of at least a majority of its outstanding shares possessing a right to vote in such matter under the mandatory voting provisions of the Delaware General Corporation Law. The General Partner shall not be compensated for its services as General Partner of the Partnership. 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 expenses that it incurs relating to the ownership and operation of, or for the benefit of, the Partnership.

          B. The Partners acknowledge that all such expenses and all operating and administrative expenses of the General Partner are deemed to be for the benefit of the Partnership. Such reimbursement shall be in addition to any reimbursement made as a result of indemnification pursuant to Section 7.08 hereof.

            Section 7.04 Liability of the General Partner .

          A. Notwithstanding anything to the contrary set forth in this Agreement, the General Partner shall not be liable for monetary damages to the Partnership, any Partners or any Assignees for losses sustained or liabilities incurred as a result of errors in judgment or of any act or omission if the General Partner acted in good faith.

          B. Subject to its obligations and duties as General Partner set forth in Section 7.01.A hereof, the General Partner may exercise any of the powers granted to it by this Agreement and perform any of the duties imposed upon it hereunder either directly or by or through its agents. The General Partner shall not be responsible for any misconduct or negligence on the part of any such agent appointed by the General Partner in good faith.

          C. Any amendment, modification or repeal of this Section 7.04 or any provision hereof shall be prospective only and shall not in any way affect the limitations on the General Partner’s to the Partnership and the Limited Partners under this Section 7.04 as in effect immediately prior to such amendment, modification or repeal with respect to claims arising from or relating to matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when such claims may arise or be asserted.

            Section 7.05 Other Matters Concerning the General Partner .

          A. The General Partner may rely and shall be protected in acting, or refraining from acting, upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, bond, debenture, or other paper or document believed by it in good faith to be genuine and to have been signed or presented by the proper party or parties.

          B. The General Partner may consult with legal counsel, accountants, appraisers, management consultants, investment bankers, architects, engineers, environmental consultants and other consultants and advisers selected by it, and any act taken or omitted to be taken in reliance upon the opinion of such Persons as to matters which such General Partner reasonably believes to be within such Person’s professional or expert competence shall be conclusively presumed to have been done or omitted in good faith and in accordance with such opinion.

          C. The General Partner shall have the right, in respect of any of its powers or obligations hereunder, to act through any of its duly authorized officers and duly appointed attorneys-in-fact. Each such attorney shall, to the extent provided by the General Partner in the power of attorney, have full power and authority to do and perform all and every act and duty which is permitted or required to be done by the General Partner hereunder.

            Section 7.06 Contracts and Transactions with Affiliates .

          A. The Partnership may, subject to the terms of any financing obtained on behalf of the Partnership and/or any of its Subsidiaries, lend or contribute funds or other assets to its Subsidiaries or other Persons in which it has an equity investment and such Persons may borrow funds from the Partnership, on terms and conditions established by the General Partner. The foregoing authority shall not create any right or benefit in favor of any Subsidiary or any other Person.

          B. The Partnership may transfer assets to joint ventures, other partnerships, corporations or other business entities in which it is or thereby becomes a participant upon such terms and subject to such conditions consistent with this Agreement and applicable law as the General Partner believes are advisable.

          C. The Board of Directors shall adopt policies and procedures to address potential conflicts arising out of transactions to which the Partnership and the Manager or its Affiliates are parties, including, but not limited to Partnership transactions between, with, or in the case of co-purchases, alongside, the Manager or its Affiliates.

            Section 7.07 Indemnification of the General Partner .

          A. To the fullest extent permitted by Delaware law to a corporation for profit organized under the General Business Corporation Law of Delaware, the Partnership shall indemnify each Indemnitee from and against any and all losses, claims, damages, liabilities, joint or several, expenses (including, without limitation, attorneys fees and other legal fees and expenses), judgments, fines, settlements, and other amounts arising from any and all claims, demands, actions, suits or proceedings (actual or threatened), civil, criminal, administrative or investigative, that relate to the operations of the Partnership as set forth in this Agreement, in which such Indemnitee may be involved, or is threatened to be involved, as a party or otherwise by reason of such Person’s service to or on behalf of or management of affairs of the Partnership, its properties, business or affairs, unless it is established that: (i) the act or omission giving rise to the claim, demand, suit or proceeding constituted bad faith, willful misconduct, gross negligence or reckless disregard of duties. The termination of any proceeding by conviction of an Indemnitee or upon a plea of nolo contendere or its equivalent by an Indemnitee, or an entry of an order of probation against an Indemnitee prior to judgment, shall not, of itself, create a presumption that the Indemnitee acted in a manner contrary to that specified in this Section 7.07A.

          B. Any indemnification pursuant to this Section 7.07 shall be made only out of the assets of the Partnership, and neither the General Partner nor any Limited Partner shall have any obligation to contribute to the capital of the Partnership, or otherwise provide funds, to enable the Partnership to fund its obligations under this Section 7.07.

          C. Reasonable expenses incurred by an Indemnitee who is a party to a proceeding shall be paid or reimbursed by the Partnership in advance of the final disposition of the proceeding upon receipt by the Partnership of (i) a written affirmation by the Indemnitee of the Indemnitee’s good faith belief that the standard of conduct necessary for indemnification by the Partnership as authorized in Section 7.07.A. has been met, and (ii) a written undertaking by or on behalf of the Indemnitee to repay the amount if it shall ultimately be determined that the standard of conduct has not been met.

          D. The indemnification provided by this Section 7.07 shall be in addition to any other rights to which an Indemnitee or any other Person may be entitled under any agreement, pursuant to any vote of the Partners, as a matter of law or otherwise, and shall continue as to an Indemnitee who has ceased to serve in such capacity unless otherwise provided in a written agreement pursuant to which such Indemnitee is indemnified.

          E. The Partnership may, but shall not be obligated to, purchase and maintain insurance, on behalf of the Indemnitees and such other Persons as the Board of Directors shall determine, against any liability that may be asserted against or expenses that may be incurred by such Person in connection with the Partnership’s activities, regardless of whether the Partnership would have the power to indemnify such Person against such liability under the provisions of this Agreement.

          F. For purposes of this Section 7.07, the Partnership shall be deemed to have requested an Indemnitee to serve as fiduciary of an employee benefit plan whenever the performance by it of its duties to the Partnership also imposes duties on, or otherwise involves services by, it to the plan or participants or beneficiaries of the plan; excise taxes assessed on an Indemnitee with respect to an employee benefit plan pursuant to applicable law shall constitute fines within the meaning of this Section 7.07; and actions taken or omitted by the Indemnitee with respect to an employee benefit plan in the performance of its duties for a purpose reasonably believed by it to be in the interest of the participants and beneficiaries of the plan shall be deemed to be for a purpose which is not opposed to the best interests of the Partnership.

          G. In no event may an Indemnitee subject any of the Partners to personal liability by reason of the indemnification provisions set forth in this Agreement.

          H. An Indemnitee shall not be denied indemnification in whole or in part under this Section 7.07 because the Indemnitee had an interest in the transaction with respect to which the indemnification applies if the transaction was otherwise permitted by the terms of this Agreement.

          I. The provisions of this Section 7.07 are for the benefit of the Indemnitees, their heirs, successors, assigns and administrators and shall not be deemed to create any rights for the benefit of any other Persons. Any amendment, modification or repeal of this Section 7.07 or any provision hereof shall be prospective only and shall not in any way affect the Partnership’s liability to any Indemnitee under this Section 7.07, as in effect immediately prior to such amendment, modification, or repeal with respect to claims arising from or relating to matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when such claims may arise or be asserted.

            Section 7.08 Title to Partnership Assets.

          Title to Partnership assets, whether real, personal or mixed and whether tangible or intangible, shall be deemed to be owned by the Partnership as an entity, and no Partner, individually or collectively, shall have any ownership interest in such Partnership assets or any portion thereof. Title to any or all of the Partnership assets may be held in the name of the Partnership, the General Partner or one or more nominees, as the General Partner may determine, including Affiliates of the General Partner. The General Partner hereby declares and warrants that any Partnership assets for which legal title is held in the name of the General Partner or any nominee or Affiliate of the General Partner shall be held by the General Partner for the use and benefit of the Partnership in accordance with the provisions of this Agreement; provided , however , that the General Partner shall use its best efforts to cause beneficial and record title to such assets to be vested in the Partnership as soon as reasonably practicable if failure to so vest such title would have a material adverse effect on the Partnership. All Partnership assets shall be recorded as the property of the Partnership in its books and records, irrespective of the name in which legal title to such Partnership assets is held.

            Section 7.09 Reliance by Third Parties .

          In no event shall any Person dealing with the General Partner or its representatives be obligated to ascertain that the terms of this Agreement have been complied with or to inquire into the necessity or expedience of any act or action of the General Partner or its representatives. Subject to Section 9.01, each and every certificate, document or other instrument executed on behalf of the Partnership by the General Partner or its representatives shall be conclusive evidence in favor of any and every Person relying thereon or claiming thereunder that (i) at the time of the execution and delivery of such certificate, document or instrument, this Agreement was in full force and effect; (ii) the Person executing and delivering such certificate, document or instrument was duly authorized and empowered to do so for and on behalf of the Partnership; and (iii) such certificate, document or instrument was duly executed and delivered in accordance with the terms and provisions of this Agreement and is binding upon the Partnership.

ARTICLE VIII

RIGHTS AND OBLIGATIONS OF LIMITED PARTNERS

            Section 8.01 Limitation of Liability .

          The Limited Partners shall have no liability under this Agreement except as expressly provided in this Agreement, including Section 12.04 hereof, or under the Act.

            Section 8.02 Management of the Business .

          No Limited Partner or Assignee (other than members of the Board of Directors, the General Partner, the Manager, any of their Affiliates or any officer, director, employee, agent or trustee of the Partnership, the General Partner, the Manager or any of their Affiliates, in their capacity as such) shall take part in the operation, management or control (within the meaning of the Act) of the Partnership’s business, transact any business in the Partnership’s name or have the power to sign documents for or otherwise bind the Partnership. In accordance with Section 17-303(b)(9) of the Act, neither service on the Board of Directors nor serving as an officer, director employee, agent or trustee of the Partnership, the General Partner, the Manager or any of their Affiliates shall constitute participating in the control of the business of the Partnersh