Inc., the Limited Partner, Simon Acquisition I, LLC, Simon Acquisition II, LLC, Chelsea Property Group, Inc. and the Partnership, the Limited Partner acquired all of the outstanding limited partnership units of the Partnership on and as of the date hereof;

 

WHEREAS, the General Partner and the Limited Partner now desire to amend and restate the Agreement of Limited Partnership, dated as of October 14, 1993, of the Partnership, as amended (as so amended prior to the date hereof, the “Prior Partnership Agreement”) in the manner set forth herein;

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby amend and restate the Prior Partnership Agreement as follows:

 

ARTICLE I.

DEFINITIONS; ETC.

 

1.1                                  Definitions .  Except as otherwise herein expressly provided, the following terms and phrases shall have the meanings set forth below:

 

“ Act ” shall mean the Revised Uniform Limited Partnership Act as enacted in the State of Delaware, and as the same shall be amended from time to time.

 

“ Administrative Expenses ” shall mean (i) all administrative and operating costs and expenses incurred by the Partnership, and (ii) those administrative costs and expenses and accounting and legal expenses undertaken by the General Partner on behalf or for the benefit of the Partnership.

 

“ Affiliate ” means, with respect to any Person, any other Person directly or indirectly Controlling or Controlled by or under direct or indirect common Control with such Person.

 

“ Affiliate Financing ” shall mean financing or refinancing obtained from a Partner or an Affiliate of a Partner by the Partnership.

 

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“ Agreement ” shall mean this Agreement of Limited Partnership, as originally executed and as amended, modified, supplemented or restated from time to time, as the context requires.

 

“ Bankruptcy ” means, with respect to any Person, if such Person (i) makes an assignment for the benefit of creditors, (ii) files a voluntary petition in bankruptcy, (iii) is adjudged as bankrupt or insolvent, or has entered against it an order for relief, in any bankruptcy or insolvency proceedings, (iv) files a petition or answer seeking for itself any reorganization, arrangement, composition, readjustment, liquidation or similar relief under any statute, law or regulation, (v) files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against it in any proceeding of this nature, (vi) seeks, consents to or acquiesces in the appointment of a trustee, receiver or liquidator of the Person or of all or any substantial part of its properties, or (vii) if 120 days after the commencement of any proceeding against the Person seeking reorganization, arrangement, composition, readjustment, liquidation or similar relief under any statute, law or regulation, if the proceeding has not been dismissed, or if within 90 days after the appointment without such Person’s consent or acquiescence of a trustee, receiver or liquidator of such Person or of all or any substantial part of its properties, the appointment is not vacated or stayed, or within 90 days after the expiration of any such stay, the appointment is not vacated.  The foregoing definition of “Bankruptcy,” in conjunction with Section 6.2 of this Agreement, is intended to and shall supersede the events of withdrawal set forth in Sections 17-402(4) and (5) of the Act.

 

“ Capital Contribution ” shall mean, 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 with respect to the Partnership Interest held by such Partner (net of liabilities to which such property is subject).

 

“ Code ” shall mean the Internal Revenue Code of 1986, as amended, and as it may be further amended from time to time, any successor statutes thereto, and applicable United States Department of Treasury regulations issued pursuant thereto in temporary or final form.

 

“ Control ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ownership of voting securities or general partnership or managing member interests, by contract or otherwise.

 

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“ Controlling ” and “ Controlled ” shall have correlative meanings.  Without limiting the generality of the foregoing, a Person shall be deemed to Control any other Person in which it owns, directly or indirectly, a majority of the ownership interests.

 

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

 

“ Entity ” shall mean any general partnership, limited liability partnership, joint stock company, limited partnership, limited liability company, corporation, joint venture, trust or business trust.

 

“ ERISA ” shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time (or any corresponding provisions of succeeding laws).

 

“ GAAP ” shall mean generally accepted accounting principles consistently applied.

 

“ General Partner ” shall mean Chelsea Property Group, Inc., a Maryland corporation and any other person that becomes the General Partner of the Partnership pursuant to this Agreement.

 

“ Gross Asset Value ” shall have the meaning set forth in Section 4.6(b).

 

“ Gross Income ” shall mean the income of the Partnership determined pursuant to Section 61 of the Code before deduction of items of expense or deduction.

 

“ Immediate Family ” shall mean, with respect to any Person, such Person’s spouse, parents, parents-in-law, descendants by blood or adoption, nephews, nieces, brothers, sisters, brothers-in-law, sisters-in-law and children-in-law.

 

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“ Lien ” shall mean any liens, security interests, mortgages, deeds of trust, charges, claims, encumbrances, restrictions, pledges, options, rights of first offer or first refusal and any other rights or interests of others of any kind or nature, actual or contingent, or other similar encumbrances of any nature whatsoever.

 

“ Limited Partner(s) ” shall mean Simon Property Group, L.P., a Delaware limited partnership, together with any person who is admitted in accordance with the terms of this Agreement, but only upon their having been formerly admitted pursuant to the terms hereof.

 

“ Liquidating Agent ” shall mean the General Partner or an Affiliate of the General Partner, provided such Liquidating Agent agrees in writing to be bound by the terms of this Agreement.  The Liquidating Agent shall be empowered to give and receive notices, reports and payments in connection with the dissolution, liquidation and/or winding-up of the Partnership and shall hold and exercise such other rights and powers as are necessary or required to permit all parties to deal with the Liquidating Agent in connection with the dissolution, liquidation and/or winding-up of the Partnership.

 

“ Losses ” shall have the meaning set forth in Section 5.1 hereof.

 

“ Minimum Gain ” shall have the meaning set forth in Section 5.1(d)(1) hereof.

 

“ Minimum Gain Chargeback ” shall have the meaning set forth in Section 5.1(d)(1) hereof.

 

“ Net Financing Proceeds ” shall mean the cash proceeds received by the Partnership in connection with any borrowing by or on behalf of the Partnership (whether or not secured), after deduction of all costs and expenses incurred by the Partnership in connection with such borrowing, and after deduction of that portion of such proceeds used to repay any other indebtedness of the Partnership, or any interest or premium thereon.

 

“ Net Operating Cash Flow ” shall mean, with respect to any fiscal period of the Partnership, the aggregate amount of all cash received by the Partnership from any source for such Fiscal Period (including Net Sale Proceeds and Net Financing Proceeds and distributions from any subsidiary of the Partnership, but excluding Capital Contributions) less the aggregate amount of all expenses or other amounts paid with respect to such period (including all payments

 

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of principal and interest on account of our indebtedness of the Partnership), and such additional cash reserves as of the last day of such period as the General Partner deems necessary for any capital or operating expenditure permitted hereunder.

 

“ Net Sale Proceeds ” shall mean the cash proceeds received by the Partnership in connection with a sale of any asset by or on behalf of the Partnership after deduction of any costs or expenses incurred by the Partnership, or payable specifically out of the proceeds of such sale (including, without limitation, any repayment of any indebtedness required to be repaid as a result of such sale or which the General Partner elects to repay out of the proceeds of such sale, together with accrued interest and premium, if any, thereon and any sales commissions or other costs and expenses due and payable to any Person in connection with a sale).

 

“ Nonrecourse Liabilities ” shall have the meaning set forth in Section 5.1(d)(1) hereof.

 

“ Partner Nonrecourse Debt ” shall have the meaning set forth in Section 5.1(d)(2) hereof.

 

“ Partner Nonrecourse Debt Minimum Gain ” shall have the meaning set forth in Section 5.1(d)(2) hereof.

 

“ Partner Nonrecourse Deduction ” shall have the meaning set forth in Section 5.1(d)(2) hereof.

 

“ Partner(s) ” shall mean the General Partner and the Limited Partner(s), their duly admitted successors or assigns or any Person who is a partner of the Partnership at the time of reference thereto who have executed the Agreement.

 

“ Partnership ” shall mean the limited partnership hereby constituted, as such limited partnership may from time to time be constituted.

 

“ Partnership Fiscal Year ” shall mean the calendar year.

 

“ Partnership Interest ” shall mean with respect to a Partner, such Partner’s right to the allocations (and each item thereof), specified in Section 5.1 hereof and all distributions from the Partnership, and its rights of management, consent, approval or participation, if any, as provided in this Agreement.

 

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“ Partnership Minimum Gain ” shall have the meaning set forth in Section 1.704-2(b)(2) of the Regulations.

 

“ Percentage Interest ” shall mean, with respect to any Partner, the percentage ownership interest of such Partner in the Partnership.

 

“ Person ” shall mean any individual or Entity.

 

“ Pledge ” shall mean a pledge or grant of a mortgage, security interest, lien or other encumbrance in respect of a Partnership Interest.

 

“ Profits ” shall have the meaning set forth in Section 5.1 hereof.

 

“ Property ” shall have the meaning set forth in Section 2.3(a).

 

“ REIT Requirements ” shall have the meaning set forth in Section 5.3 hereof.

 

“ Regulations ” shall mean the final, temporary or proposed Income Tax Regulations promulgated under the Code, as such regulations may be amended from time to time (including corresponding provisions of succeeding regulations).

 

“ Required Funds ” shall have the meaning set forth in Section 4.3 hereof.

 

“ Substituted Limited Partner ” shall mean a person that is admitted to the Partnership by the General Partner according to Section 8.1.

 

“ Third Party ” or “ Third Parties ” shall mean a Person or Persons who is or are neither a Partner or Partners nor an Affiliate or Affiliates of a Partner or Partners.

 

“ Third Party Financing ” shall mean financing or refinancing obtained from a Third Party by the Partnership.

 

“ Transfer ” shall mean any assignment, sale, transfer, conveyance or other disposition or act of alienation, whether voluntary or involuntary, or by operation of law.

 

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ARTICLE II.

ORGANIZATION

 

2.1                                  Formation .  The Partnership has heretofore been organized pursuant to the provisions of the Act, and all other pertinent laws of the State of Delaware, for the purposes and upon the terms and conditions hereinafter set forth.  The Partners agree that the rights and liabilities of the Partners shall be as provided in the Act except as otherwise herein expressly provided.  The General Partner shall promptly cause the execution and delivery of such documents and shall perform such acts consistent with the terms of this Agreement as may be necessary to comply with the requirements of law for the formation, qualification, and operation of a limited partnership under the laws of the State of Delaware.  Upon request of the General Partner, the Limited Partner shall execute any certificates required by law to be filed in connection with the formation, qualification, and operation of a limited partnership under the laws of the State of Delaware.

 

2.2                                  Name .  The business of the Partnership shall be conducted under the name of Chelsea Property Group, L.P.. and all transactions of the Partnership, to the extent permitted by applicable law, shall be carried on and completed in such name.  The Partnership shall at all times conduct its own business in its own name and title to all assets or property owned by the Partnership shall be held in such name.

 

2.3                                  Purpose and Business of the Partnership .

 

(a)                                   Subject to the limitations set forth herein, the purpose for which the Partnership is formed is to engage exclusively in the following activities:

 

(1)                                   to own real estate and improvements located thereon (the “Property”) and to hold, administer, service or enter into agreements for the servicing of or collect amounts due on the Property, including any proceeds or rights associated therewith;

 

(2)                                   finance, manage, sell, assign, pledge, lease, operate and otherwise deal with the Property.

 

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(3)                                   to incur indebtedness (the “Indebtedness”) secured by the Property and entering into any and all documents necessary to evidence, secure or support the Indebtedness;

 

(4)                                   to invest or direct the investment of, proceeds from the Property and its other assets and any capital and income of the Partnership;

 

(5)                                   to do such other things and carry on any other activities necessary, convenient or incidental to any of the foregoing purposes, and have and exercise all of the power and rights conferred upon limited partnerships formed pursuant to the Act in furtherance of the foregoing;

 

(6)                                   to engage in any activities necessary to hold, receive, exchange, otherwise dispose of and otherwise deal in and exercise all rights, powers, privileges, and all other incidents of ownership or possession with respect to all the Property and any property or interests which may be acquired by the Partnership as a result of any sale or other disposition of any Property;

 

(7)                                   to engage in any activities necessary to authorize, execute and deliver any other instrument, agreement, certificate, notice or document in connection with the activities described above, including the filing of any instrument, agreements, certificates, notices, applications and other documents necessary or advisable to comply with any applicable laws, statutes, rules and regulations or necessary or advisable to perfect or protect any security interests granted regarding the Property;

 

(8)                                   to engage in such lawful activities and to exercise such powers permitted to partnerships under the laws of the State of Delaware that are necessarily incident to or connected with the foregoing or necessary or convenient to accomplish the foregoing and which are consistent with the limitations set forth in this Section 2.3(a) and Section 6.4 hereof.

 

2.4                                  Location of the Principal Place of Business .  The location of the principal place of business of the Partnership shall be 115 West Washington Street, Indianapolis, Indiana 46204, or

 

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such other location as shall be selected from time to time by the General Partner in its sole discretion.

 

2.5                                  Registered Agent and Registered Office .  The Registered Agent of the Partnership shall be The Corporation Trust Company, or such other Person as the General Partner may select in its sole discretion.  The Registered Office of the Partnership shall be c/o The Corporation Trust Company, 1209 Orange Street, Wilmington, DE 19801 or such other location as the General Partner may select in its sole and absolute discretion.

 

2.6                                  Address of the General Partner .  The address of the General Partner is Chelsea Property Group, Inc., 115 West Washington Street, Indianapolis, Indiana 46204.

 

2.7                                  Address of the Limited Partner .  The address of the Limited Partner is Simon Property Group, L.P., 115 West Washington Street, Indianapolis, Indiana 46204.

 

ARTICLE III.

TERM

 

3.1                                  Dissolution . The Partnership shall be dissolved upon the first to occur of one of the following events:

 

(a) the occurrence of an entry of a judicial decree dissolving the Partnership;

 

(b) at any time there are no limited partners of the Partnership, unless the business of the Partnership is continued in accordance with the Act;

 

(c) any events that result in the General Partner ceasing to be a general partner of the Partnership under the Act, provided that the Partnership shall not be dissolved and required to be wound up in connection with any such event if (A) at the time of the occurrence of such event there is at least one remaining general partner of the Partnership who is hereby authorized to and does carry on the business of the Partnership, or (B) within 90 days after the occurrence of such event, a majority of the limited partners agree in writing or vote to continue the business of the Partnership and to the appointment, effective as of the date of such event, if required, of one or more additional general partners of the Partnership;

 

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(d) the date on which all of the real property acquired by the Partnership is sold or otherwise disposed of; or

 

(e) the date on which the Partnership is voluntarily dissolved by the agreement of the Partners.

 

ARTICLE IV.

CONTRIBUTIONS TO CAPITAL

 

4.1                                  General Partner Capital Contributions .  As of the date hereof, the General Partner has a Capital Account Percentage as set forth on Schedule 1 .  The General Partner may from time to time make Capital Contributions to the Partnership.

 

4.2                                  Contributions of Limited Partners .  As of the date hereof, the Limited Partner has a Capital Account Percentage as set forth on Schedule 1 .  With the consent of the General Partner, the Limited Partner may from time to time make Capital Contributions to the Partnership.  Except as otherwise expressly provided herein or required by applicable law, the Limited Partner shall not be required to contribute any additional capital to the Partnership.

 

4.3                                  Additional Funds .  The Partnership may obtain funds (“Required Funds”) which it considers necessary to meet the needs and obligations and requirements of the Partnership, or to maintain adequate working capital or to repay Partnership indebtedness, and to carry out the Partnership’s purposes, from the proceeds of Third Party Financing or Affiliate Financing.  In no event may the Partnership obtain any Third Party Financing that is recourse to any Partner or any Affiliate, partner, shareholder, beneficiary, principal, officer, or director of any Partner without the consent of the affected Partner and any other Person or Persons to whom such recourse may be had.

 

4.4                                  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 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 of, 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 to the Partnership shall be deemed an asset of the Partnership for any purpose by any creditor or

 

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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.

 

4.5                                  No Interest; No Return .  No Partner shall be entitled to interest on its Capital Contribution or on such Partner’s Capital Account.  Except as provided herein or by law, no Partner shall have any right to withdraw any part of its Capital Account or to demand or receive the return of its Capital Contribution from the Partnership.

 

4.6                                  Capital Accounts .

 

(a)                                   The Partnership shall establish and maintain a separate capital account (“Capital Account”) for each Partner, including a substitute partner who shall pursuant to the provisions hereof acquire a Partnership Interest, which Capital Account shall be:

 

(1)                                   credited with the amount of cash contributed by such Partner to the capital of the Partnership; the initial Gross Asset Value (net of liabilities secured by such contributed property that the Partnership assumes or takes subject to) of any other property contributed by such Partner to the capital of the Partnership; such Partner’s distributive share of Profits; and any other items in the nature of income or gain that are allocated to such Partner pursuant to Section 5.1 hereof, but excluding tax items described in Regulations Section 1.704-1(b)(4)(i); and

 

(2)                                   debited with the amount of cash distributed to such Partner pursuant to the provisions of this Agreement; the Gross Asset Value (net of liabilities secured by such distributed property that such Partner assumes or takes subject to) of any Partnership property distributed to such Partner pursuant to any provision of this Agreement; such Partner’s distributive share of Losses; and any other items in the nature of expenses or losses that are allocated to such Partner pursuant to Section 5.1 hereof, but excluding tax items described in Regulations Section 1.704-1(b)(4)(i).

 

In the event that a Partner’s Partnership Interest or portion thereof is transferred within the meaning of Regulations Section 1.704-1(b)(2)(iv)(f), the transferee shall

 

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succeed to the Capital Account of the transferor to the extent that it relates to the Partnership Interest or portion thereof so transferred.

 

In the event that the Gross Asset Values of Partnership assets are adjusted as described below in Section 4.6(b) hereof, the Capital Accounts of the Partners shall be adjusted to reflect the aggregate net adjustments as if the Partnership sold all of its property for their fair market values and recognized gain or loss for federal income tax purposes equal to the amount of such aggregate net adjustment.

 

The foregoing provisions and the other provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Section 1.704-1(b) of the Regulations, and shall be interpreted and applied as provided in the Regulations.

 

(b)                                  The term “Gross Asset Value” or “Gross Asset Values” means, with respect to any asset of the Partnership, such asset’s adjusted basis for federal income tax purposes, except as follows:

 

(1)                                   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 reasonably determined by the General Partner;

 

(2)                                   the Gross Asset Values of all Partnership assets shall be adjusted to equal their respective gross fair market values, as reasonably determined by the General Partner, immediately prior to the following events:

 

(i)                                      a Capital Contribution (other than a de minimis Capital Contribution, within the meaning of Section 1.704-1(b)(2)(iv)(f)(5)(i) of the Regulations) to the Partnership by a new or existing Limited Partner as consideration for a Partnership Interest;

 

(ii)                                   the distribution by the Partnership to a Partner of more than a de minimis amount (within the meaning of Section 1.704-1(b)(2)(iv)(f)(5)(ii) of the Regulations) of Partnership property as consideration for the redemption of a Partnership Interest; and

 

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(iii)                                the liquidation of the Partnership within the meaning of Section 1.704-1(b)(2)(ii)(g) of the Regulations.

 

(3)                                   the Gross Asset Values of Partnership assets distributed to any Partner shall be the gross fair market values of such assets as reasonably determined by the General Partner as of the date of distribution.

 

At all times, Gross Asset Values shall be adjusted by any Depreciation taken into account with respect to the Partnership’s assets for purposes of computing Profits and Losses.  Any adjusting to the Gross Asset Values of Partnership property sha