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EXHIBIT 3.66 FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF PAVILLION NORTH, A LIMITED PARTNERSHIP

Limited Partnership Agreement

EXHIBIT 3.66 FIRST
AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
PAVILLION NORTH,
A LIMITED PARTNERSHIP 

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Title: EXHIBIT 3.66 FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF PAVILLION NORTH, A LIMITED PARTNERSHIP
Governing Law: Pennsylvania     Date: 2/24/2006

EXHIBIT 3.66 FIRST
AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
PAVILLION NORTH,
A LIMITED PARTNERSHIP 

, Parties: omega healthcare investors inc , pavillion north
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Exhibit 3.66

FIRST
AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
PAVILLION NORTH,
A LIMITED PARTNERSHIP

TABLE OF CONTENTS

SECTION 1

 

THE PARTNERSHIP

 

1

 

 

1.1

 

Organization

 

1

 

 

1.2

 

Partnership Name

 

1

 

 

1.3

 

Purpose

 

1

 

 

1.4

 

Principal Place of Business

 

1

 

 

1.5

 

Term

 

2

 

 

1.6

 

Filings; Agent for Service of Process

 

2

 

 

1.7

 

Independent Activities

 

2

 

 

1.8

 

Definitions

 

2


SECTION 2


 


PARTNERS' CAPITAL ACCOUNTS


 


2

 

 

2.1

 

Contributions

 

2

 

 

2.2

 

Capital Accounts

 

2

 

 

2.3

 

Other Matters

 

2

SECTION 3

 

ALLOCATIONS

 

3

 

 

3.1

 

Profits

 

3

 

 

3.2

 

Losses

 

3

 

 

3.3

 

Special Allocations

 

3

 

 

3.4

 

Curative Allocations

 

4

 

 

3.5

 

Other Allocation Rules

 

4

 

 

3.6

 

Tax Allocations: Code Section 704(c)

 

5


SECTION 4


 


DISTRIBUTIONS


 


5


SECTION 5


 


MANAGEMENT


 


5

 

 

5.1

 

Authority of the General Partners

 

5

 

 

5.2

 

Right to Rely on General Partners

 

6

 

 

5.3

 

Limitations on Authority of General Partners

 

7

 

 

5.4

 

Duties and Obligations of General Partners

 

7

 

 

5.5

 

Indemnification of General Partners

 

8

 

 

5.6

 

Compensation and Loans

 

8

 

 

5.7

 

Operating Restrictions

 

8


SECTION 6


 


ROLE OF LIMITED PARTNERS


 


9

 

 

6.1

 

Limitation on Rights or Powers

 

9

 

 

6.2

 

Voting Rights

 

9

 

 

6.3

 

Other Rights

 

9


SECTION 7


 


BOOKS AND RECORDS


 


9

 

 

7.1

 

Books and Records

 

9

 

 

7.2

 

Annual Reports

 

9

 

 

 

 

 

 

 

 

i


 

 

7.3

 

Tax Information

 

9


SECTION 8


 


AMENDMENTS; MEETINGS


 


10

 

 

8.1

 

Amendments

 

10

 

 

8.2

 

Meetings of the Partners

 

10


SECTION 9


 


TRANSFERS OF INTERESTS


 


10

 

 

9.1

 

Restriction on Transfers

 

10

 

 

9.2

 

Permitted Transfers

 

10

 

 

9.3

 

Conditions to Permitted Transfers

 

10

 

 

9.4

 

Right of First Refusal

 

11

 

 

9.5

 

Prohibited Transfers

 

12

 

 

9.6

 

Rights of Unadmitted Assignees

 

12

 

 

9.7

 

Admission of Interest Holders as Partners

 

12

 

 

9.8

 

Distributions and Allocations in Respect to Transferred Interests

 

12

 

 

9.9

 

Withdrawal

 

13


SECTION 10


 


GENERAL PARTNERS


 


13

 

 

10.1

 

Additional General Partners

 

13

 

 

10.2

 

Covenant Not to Withdraw, Transfer, or Dissolve

 

13

 

 

10.3

 

Permitted Transfers

 

13

 

 

10.4

 

Prohibited Transfers

 

13

 

 

10.5

 

Termination of Status as General Partner

 

13


SECTION 11


 


DISSOLUTION AND WINDING UP


 


14

 

 

11.1

 

Liquidating Events

 

14

 

 

11.2

 

Winding Up

 

14

 

 

11.3

 

Compliance With Certain Requirements of Regulations

 

15

 

 

11.4

 

Deemed Distribution and Recontribution

 

15

 

 

11.5

 

Notice of Dissolution

 

15


SECTION 12


 


POWER OF ATTORNEY


 


15

 

 

12.1

 

General Partners as Attorneys-In-Fact

 

15

 

 

12.2

 

Nature as Special Power

 

15


SECTION 13


 


MISCELLANEOUS


 


16

 

 

13.1

 

Waiver

 

16

 

 

13.2

 

Notices

 

16

 

 

13.3

 

Applicable Law

 

16

 

 

13.4

 

Counterparts

 

16

 

 

13.5

 

Entire Agreement

 

16

 

 

13.6

 

Parties Bound

 

16

 

 

13.7

 

Further Action

 

16

 

 

13.8

 

Variation Pronouns

 

16


EXHIBIT A


 


Partners' Names, Addresses, Capital Contributions, and Percentage Interests


 


 


APPENDIX


 


Definitions

ii


FIRST
AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP OF
PAVILLION NORTH,
A LIMITED PARTNERSHIP

        This Agreement is entered into and shall be effective as of the 13th day of December, 1993, by and among PAVILLION NURSING CENTER NORTH, INC. and HOLLIS J. GARFIELD as the General Partners, and the Persons whose names are set forth on EXHIBIT A attached hereto, as the Limited Partners.

R E C I T A L S:

        WHEREAS, PAVILLION NORTH, a Limited Partnership was originally organized pursuant to the Original Partnership Agreement which was subsequently amended; and

        WHEREAS, an original Certificate of Limited Partnership for the Partnership was filed in Allegheny County on February 9, 1972, which Certificate was subsequently amended by a First Amendment to Certificate of Limited Partnership executed by the Partners on August 22, 1978, by a Second Amendment to Certificate of Limited Partnership executed by the Partners on July 20, 1979, by a Third Amendment to Certificate of Limited Partnership executed by the Partners on November 3, 1980 and by a Fourth Amendment to Certificate of Limited Partnership executed by the Partners on March 30, 1984; and

        WHEREAS, SIDNEY GARFIELD died on January 2, 1991, and the Partners have agreed that the General Partner Interest of SIDNEY GARFIELD be converted into a Limited Partner Interest and the Limited Partner Interest of HOLLIS J. GARFIELD be converted into a General Partner Interest; and

        WHEREAS, EVELYN R. GARFIELD as the Executrix of the estate of SIDNEY GARFIELD has pursuant to the terms of his will assigned on December 13, 1993 the estate's General and Limited Partner Interests in the Partnership 24% to EVELYN R. GARFIELD as the trustee of the SIDNEY GARFIELD TRUST A REVERSE QTIP TRUST and 21.6% to EVELYN R. GARFIELD as the trustee of the SIDNEY R. GARFIELD TRUST A EVELYN TRUST; and

        WHEREAS, as a result of the foregoing, the capital contributions and shares of profits and losses of the Partners in the Partnership are as set forth on EXHIBIT A attached; and

        NOW, THEREFORE, the Partners hereby amend and restate the Original Partnership Agreement as amended upon the following terms and conditions:

SECTION 1

THE PARTNERSHIP

        1.1     Organization.     The Partnership was originally organized as a limited partnership under the Pennsylvania Limited Partnership Act of April 12, 1917, P.L. 55, as amended ("Prior Act"), and the Partners will now organize the Partnership as a limited partnership pursuant to the provisions of the Act.

        1.2     Partnership Name.     The name of the Partnership shall continue to be PAVILLION NORTH, a Limited Partnership and all business of the Partnership shall be conducted in such name, dba Wexford House Nursing Center.

        1.3     Purpose.     The purpose of the Partnership is to acquire, improve, lease, operate, and hold the nursing center located at the principal place of business of the Partnership and to engage in any and all activities related or incidental thereto. The Partnership shall engage in no other business.

        1.4     Principal Place of Business.     The principal place of business of the Partnership is 9800 Old Perry Highway, Wexford, Allegheny County, Pennsylvania 15090. The General Partners may change the


 

principal place of business of the Partnership to any other place within the Commonwealth of Pennsylvania upon at least 10 days notice to the Limited Partners.

        1.5     Term.     The term of the Partnership shall continue perpetually unless the Partnership is earlier dissolved, wound-up, and liquidated as provided in Section 11 hereof.

        1.6     Filings; Accent for Service of Process .    

        (a)   The General Partners shall cause a First Amended and Restated Certificate of Limited Partnership and a Certificate of Summary of Record to be filed in the officer of the Department of State in accordance with the provisions of the Act.

        (b)   The registered office of the Partnership shall be 9800 Old Perry Highway, Wexford, Pennsylvania 15090, or any successor as appointed by the General Partners. The General Partners may change the office of the Partnership to another location within the Commonwealth of Pennsylvania upon at least 10 days notice to the Limited Partners.

        (c)   Upon the dissolution of the Partnership, the General Partners (or, in the event there is no remaining General Partner, any Person elected pursuant to Section 11.2 hereof) shall promptly execute and cause to be filed a Certificate of Cancellation in accordance with the Act and the laws of any other states or jurisdictions in which the Partnership has filed certificates.

        1.7     Independent Activities.     Each General Partner and each Limited Partner may, notwithstanding this Agreement, engage in whatever activities they choose, whether the same are competitive with the Partnership or otherwise, without having or incurring any obligation to offer any interest in such activities to the Partnership or any Partner. Neither this Agreement nor any activity undertaken pursuant hereto shall prevent any Partner from engaging in such activities, or require any Partner to permit the Partnership or any Partner to participate in any such activities, and as a material part of the consideration for the execution of this Agreement by each Partner, each Partner hereby waives, relinquishes, and renounces any such right or claim of participation.

        1.8     Definitions.     Capitalized words and phrases used in this Agreement have the meanings set forth therefor in the Appendix hereto.

SECTION 2

PARTNERS' CAPITAL ACCOUNTS

        2.1     Contributions.     The names, addresses, Capital Contributions, and Percentage Interests of the Partners are set forth on EXHIBIT A attached hereto.

        2.2     Capital Accounts.     The General Partners shall maintain Capital Accounts for each of the Partners and Interest Holders in accordance with the provisions of the Appendix with respect thereto.

        2.3     Other Matters .    

        (a)   Except as otherwise provided in this Agreement, no Partner shall demand or receive a return of her Capital Contributions or withdraw from the Partnership without the consent of all Partners. Under circumstances requiring a return of any Capital Contributions, no Partner shall have the right to receive property other than cash except as may be specifically provided herein.

        (b)   No Partner shall receive any interest with respect to her Capital Contributions or her Capital Account except as otherwise provided in this Agreement.

        (c)   No Limited Partner shall be liable for the debts, liabilities, contracts or any other obligations of the Partnership.

2


 

SECTION 3

ALLOCATIONS

        3.1     Profits.     After giving effect to the special allocations set forth in Sections 3.3 and 3.4 hereof, Profits for any fiscal year shall be allocated among the General Partners and other Interest Holders in proportion to their Percentage Interests.

        3.2     Losses.     After giving effect to the special allocations set forth in Sections 3.3 and 3.4 hereof, Losses for any fiscal year shall be allocated among the General Partners and Interest Holders in proportion to their Percentage Interests; provided, however, the Losses so allocated cannot cause any Interest Holder to have an Adjusted Capital Account Deficit at the end of any fiscal year. All Losses in excess of such limitation shall be allocated to the General Partners in proportion to their Percentage Interests in the Partnership.

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

        (a)     Minimum Gain Chargeback.     Except as otherwise provided in Section 1.704-2(f) of the Regulations, notwithstanding any other provision of this Section 3 , if there is a net decrease in Partnership Minimum Gain during any Partnership fiscal year, each General Partner and Interest Holder shall be specially allocated items of Partnership income and gain for such year (and, if necessary, subsequent years) in an amount equal to such Person'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 General Partner and Interest Holder pursuant thereto. The items to be so allocated shall be determined in accordance with Sections 1.7042(f)(6) and 1.704-2 (j) (2) of the Regulations. This Section 3.3 (a) is intended to comply with the minimum gain chargeback requirement in Section 1.704-2(f) of the Regulations and shall be interpreted consistently therewith.

        (b)     Partner Minimum Gain Chargeback.     Except as otherwise provided in Section 1.704-2(i)(4) of the Regulations, notwithstanding any other provision of this Section 3 , if there is a net decrease in Partner Nonrecourse Debt Minimum Gain attributable to a Partner Nonrecourse Debt during any Partnership fiscal year, each Person who has a share of the Partner Nonrecourse Debt Minimum Gain attributable to such Partner Nonrecourse Debt, determined in accordance with Section 1.704-2(i)(5) of the Regulations, shall be specially allocated items of Partnership income and gain for such year (and, if necessary, subsequent years) in an amount equal to such Person's share of the net decrease in Partner Nonrecourse Debt Minimum Gain attributable to such 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 General Partner and Interest Holder pursuant thereto. The items to be so allocated shall be determined in accordance with Sections 1.704-2(i) (4) and 1.704-2 (j) (2) of the Regulations. This Section 3.3(b) is intended to comply with the minimum gain chargeback requirement in Section 1.704-2(i) (4) of the Regulations and shall be interpreted consistently therewith.

        (c)     Qualified Income Offset.     In the event any Interest Holder unexpectedly receives any adjustments, allocations, or distributions described in Section 1.704-1(b)(2)(ii)(d)(4), 1.7041(b) (2) (ii) (d) (5) or 1.704-1(b) (2) (ii) (d) (6) of the Regulations, items of Partnership income and gain shall be specially allocated to each such Interest Holder in an amount and manner sufficient to eliminate, to the extent required by the Regulations, the Adjusted Capital Account Deficit of such Interest Holder as quickly as possible, provided that an allocation pursuant to this Section 3.3(c) shall be made only if and to the extent that such Interest Holder would have an Adjusted Capital Account Deficit after all other allocations provided for in this Section 3 have been tentatively made as if this Section 3.3(c) were not in the Agreement.

3


 

        (d)     Gross Income Allocation.     In the event any Interest Holder has a deficit Capital Account at the end of any Partnership fiscal year which is in excess of the sum of (i) the amount such Interest Holder is obligated to restore pursuant to any provision of this Agreement, and (ii) the amount such Interest Holder is deemed to be obligated to restore pursuant to the penultimate sentences of Regulations Sections 1.704-2 (g) (1) and 1.704-2(i)(5), each such Interest Holder shall be specifically 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 3.3(d) shall be made only if and to the extent that such Interest Holder would have a deficit Capital Account in excess of such sum after all other allocations provided for in this Section 3 have been made as if Section 3.3 (c) hereof and this Section 3.3 (d ) were not in the Agreement.

        (e)     Partner Nonrecourse Deductions.     Any Partner Nonrecourse Deductions for any fiscal year or other period shall be specially allocated to the Partner or Interest Holder 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).

        (f)     Section 754 Adjustments.     To the extent an adjustment to the adjusted tax basis of any Partnership asset pursuant to Code Section 734(b) or Code Section 743(b) is required, pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(2) or 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 to a General Partner or Interest Holder in complete liquidation of her interest in the Partnership, the amount of such adjustment to the 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 General Partners and Interest Holders in accordance with their interests in the Partnership in the event that Regulations Section 1.704-1(b)(2)(iv)(m)(2) applies, or to the General Partner or Interest Holder to whom such distribution was made in the event that Regulations Section 1.704-1(b) (iv) (m) (4) applies. Capital Accounts are required to be adjusted pursuant to such Section of the Regulations.

        3.4     Curative Allocations.     The allocations set forth in Sections 3.2 , 3.3(a), 3.3(b) , 3.3(c), 3.3(d), 3.3(e) and 3.3(f ) 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 3.4 . Therefore, notwithstanding any other provision of this Section 3 (other than the Regulatory Allocations), the General Partners shall make such offsetting special allocations of Partnership income, gain, loss, or deduction in whatever manner they determine appropriate so that, after such offsetting allocations are made, each General Partner's and Interest Holder's Capital Account balance is, to the extent possible, equal to the Capital Account balance such General Partner or Interest Holder would have had if the Regulatory Allocations were not part of the Agreement and all Partnership items were allocated pursuant to Sections 3.1 and 3.2 . In exercising their discretion under this Section 3.4 , the General Partners shall take into account future Regulatory Allocations under Sections 3.3(a) and 3.3(b ) that, although not yet made, are likely to offset other Regulatory Allocations previously made under Section 3.3(f) .

        3.5     Other Allocation Rules .    

        (a)   For purposes of determining the Profits, Losses, or any other items allocable to any period, Profits, Losses, and any such other items shall be determined on a daily, monthly, or other basis, as determined by the General Partners using any permissible method under Code Section 706 and the Regulations thereunder.

        (b)   All allocations to the Interest Holders and General Partners pursuant to this Section 3 shall, except as otherwise provided, be divided among them in proportion to their Percentage Interests.

4


 

        (c)   Except as otherwise provided in this Agreement, all items of Partnership income, gain, loss, deduction, and any other allocations not otherwise provided for shall be divided among the General Partners and Interest Holders in the same proportions as they share Profits or Losses, as the case may be, for the year. Credits shall be allocated in the same manner as Profits.

        (d)   The Partners are aware of the income tax consequences of the allocations made by this Section 3 and hereby agree to be bound by the provisions of this Section 3 in reporting their shares of Partnership income and loss for income tax purposes.

        (e)   To the extent permitted by Section 1.704-2(h)(3) of the Regulations, the General Partners 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 Interest Holder.

        3.6     Tax Allocations: Code Section 704 (c).     In accordance with Code Section 704(c) 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 General Partners and Interest Holders so as to take account of any variation between the adjusted basis of such property to the Partnership for federal income tax purposes and its initial Gross Asset Value. In the event the Gross Asset Value of any Partnership asset is adjusted pursuant to 1 (ii) of the Appendix hereto, 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 federal income tax purposes and its Gross Asset Value in the same manner as under Code Section 704(c) and the Regulations thereunder.

SECTION 4

DISTRIBUTIONS

        Except as otherwise provided in Section 11 hereof, the Partnership shall distribute cash or Property at such times, if any, as the General Partners may determine, among the General Partners and Interest Holders in proportion to their Percentage Interests.

SECTION 5

MANAGEMENT

        5.1     Authority of the General Partners.     Except to the extent otherwise provided herein, the General Partners shall have the sole and exclusive right to manage the business of the Partnership and shall have all of the rights and powers which may be possessed by general partners under the Act including, without limitation, the right and power to:

        (a)   acquire by purchase, lease, or otherwise any real or personal property which may be necessary, convenient, or incidental to the accomplishment of the purposes of the Partnership;

        (b)   operate, maintain, finance, improve, construct, own, grant options with respect to, sell, convey, assign, mortgage, and lease any real estate and any personal property necessary, convenient, or incidental to the accomplishment of the purposes of the Partnership;

        (c)   execute any and all agreements, contracts, documents, certifications, and instruments necessary or convenient in connection with the management, maintenance, and operation of Property, or in connection with managing the affairs of the Partnership, including executing amendments to the Agreement and the Certificate in accordance with the terms of the Agreement, pursuant to any power of attorney granted by the Limited Partners to the General Partners;

        (d)   borrow money and issue evidences of indebtedness necessary, convenient, or incidental to the accomplishment of the purposes of the Partnership, and secure the same by mortgage, pledge, or other lien on any Property;

5


 

        (e)   execute, in furtherance of any or all of the purposes of the Partnership, any deed, lease, mortgage, deed of trust, mortgage note, promissory note, bill of sale, contract, or other instrument purporting to convey or encumber any or all of the Property;

        (f)    prepay in whole or in part, refinance, recast, increase, modify, or extend any liabilities affecting the Property and in connection therewith execute any extensions or renewals of encumbrances on any or all of the Property;

        (g)   care for and distribute funds to the General Partners and Interest Holders by way of cash, income, return of capital, or otherwise, all in accordance with the provisions of this Agreement, and perform all matters in furtherance of the objectives of the Partnership or this Agreement;

        (h)   contract on behalf of the Partnership for the employment and services of employees and/or independent contractors, such as lawyers and accountants, and delegate to such Persons the duty to manage or supervise any of the assets or operations of the Partnership;

        (i)    engage in any kind of activity and perform and carry out contracts of any kind (including contracts of insurance covering risks to Property and General Partner liability) necessary or incidental to, or in connection with, the accomplishment of the purposes of the Partnership, as may be lawfully carried on or performed by a partnership under the laws of each state in which the Partnership is then formed or qualified;

        (j)    make any and all elections for federal, state, and local tax purposes including, without limitation, any election, if permitted by applicable law: (i) to adjust the basis of Property pursuant to Code Sections 754, 734 (b) and 743 (b), or comparable provisions of state or local law, in connection with transfers of Partnership interests and Partnership distributions; (ii) to extend the statute of limitations for assessment of tax deficiencies against General Partners and Interest Holders with respect to adjustments to the Partnership's federal, state, or local tax returns; and (iii) to represent the Partnership, the General Partners, and the Interest Holders before taxing authorities or courts of competent jurisdiction in tax matters affecting the Partnership, the General Partners, and the Interest Holders in their capacities as General Partners or Interest Holders, and to execute any agreements or other documents relating to or affecting such tax matters, including agreements or other documents that bind the General Partners and Interest Holders with respect to such tax matters or otherwise affect the rights of the Partnership, General Partners, and Interest Holders. HOLLIS JAN GARFIELD WIGGINS is specifically authorized to act as the "Tax Matters Partner" under the Code and in any similar capacity under state or local law;

        (k)   take, or refrain from taking, all actions, not expressly proscribed or limited by this Agreement, as may be necessary or appropriate to accomplish the purposes of the Partnership; and

        (l)    institute, prosecute, defend, settle, compromise, and dismiss lawsuits or other judicial or administrative proceedings brought on or in behalf of, or against, the Partnership or the Partners in connection with activities arising out of, connected with, or incidental to this Agreement, and to engage counsel or others in connection therewith.

        5.2     Right to Rely on General Partners.     Any Person dealing with the Partnership may rely (without duty of further inquiry) upon a certificate signed by any General Partner as to:

        (a)   the identity of any General Partner or Limited Partner;

        (b)   the existence or nonexistence of any fact or facts which constitute a condition precedent to acts by a General Partner or which are in any other manner germane to the affairs of the Partnership;

        (c)   the Persons who are authorized to execute and deliver any instrument or document of the Partnership; or

6


 

        (d)   any act or failure to act by the Partnership or any other matter whatsoever involving the Partnership or any Partner.

        5.3     Limitations on Authority of General Partners.     The authority granted to the General Partners is subject to limitations so that the General Partners may not:

        (a)   do any act which is not for the purpose of carrying on the Partnership's usual business;

        (b)   assign Partnership property in trust for creditors or on the assignee's promise to pay the debts of the Partnership;

        (c)   dispose of the goodwill of the Partnership;

        (d)   do any act which would make it impossible to carry on the ordinary business of the Partnership;

        (e)   confess a judgment against the Partnership;

        (f)    submit a Partnership claim or liability to arbitration or reference; or

        (g)   do any act in contravention of the Act or the terms and conditions of this Agreement.

        5.4     Duties and Obligations of General Partners .    

        (a)   The General Partners shall take all actions which may be necessary or appropriate (i) for the continuation of the Partnership's valid existence as a limited partnership under the laws of the Commonwealth of Pennsylvania (and of each other jurisdiction in which such existence is necessary to protect the limited liability of the Limited Partners or to enable the Partnership to conduct the business in which it is engaged) and (ii) for the accomplishment of the Partnership's purposes, including the acquisition, development, maintenance, preservation, and operation of Property in accordance with the provisions of this Agreement and applicable laws and regulations.

        (b)   The General Partners shall devote to the Partnership such time as may be necessary for the proper performance of all duties hereunder, but the General Partners shall not be required to devote full time to the performance of such duties.

7


        (c)   The General Partners shall be under a fiduciary duty to conduct the affairs of the Partnership in the best interests of the Partnership and of the Limited Partners, including the safekeeping and use of all of the Property and the use thereof for the exclusive benefit of the Partnership.

        5.5     Indemnification of General Partners .    

        (a)   The Partnership, its receiver, or its trustee shall indemnify, save harmless, and pay all judgments and claims against any General Partner relating to any liability or damage incurred by reason of any act performed or omitted to be performed by such General Partner in connection with the business of the Partnership, including attorneys' fees incurred by such General Partner in connection with the defense of any action based on any such act or omission, which attorneys' fees may be paid as incurred.

        (b)   The Partnership shall indemnify, save harmless, and pay all expenses, costs, or liabilities of any General Partner who for the benefit of the Partnership makes any deposit, acquires any option, or makes any other similar payment or assumes any obligation in connection with any property proposed to be acquired by the Partnership and who suffers any financial loss as the result of such action.

        (c)   Notwithstanding the provisions of Subsections 5.5 (a) and 5.5(b) above, no General Partner shall be indemnified from any liability for fraud, bad faith, willful misconduct, or gross negligence.

        5.6     Compensation and Loans .    

        (a)     Compensation and Reimbursement.     Except as otherwise provided in this Section 5.6 , no Partner shall receive any salary, fee, or draw for services rendered to or on behalf of the Partnership, nor shall any Partner be reimbursed for any expenses incurred by such Partner on behalf of the Partnership.

        (b)     Expenses.     The General Partners may charge the Partnership for any direct expenses reasonably incurred in connection with the Partnership's business.

        (c)     Compensation.     In consideration of their performance of services on behalf of the Partnership, the General Partners shall receive no compensation in addition to the distributions of cash and other Property and allocations of Profits, Losses, and other items provided for herein, unless the Partners approve such additional compensation by majority vote.

        (d)     Loans.     Any Person may, with the consent of the General Partners, lend or advance money to the Partnership. If any Partner shall make any loan or loans to the Partnership or advance money on its behalf, the amount of any such loan or advance shall not be treated as a Capital Contribution but shall be a debt due from the Partnership. The amount of any such loan or advance by a lending Partner shall be repayable out of the Partnership's cash and shall bear interest at such rate as the General Partners and the lending Partner shall agree. None of the Partners shall be obligated to make any loan or advance to the Partnership.

        5.7     Operating Restrictions .    

        (a)   All Property in the form of cash not otherwise invested shall be deposited in one or more accounts maintained in such financial institutions as the General Partners shall determine or shall be invested in short-term liquid securities or shall be left in escrow and withdrawals shall be made only in the regular course of Partnership business on such signature or signatures as the General Partners may determine from time to time.

        (b)   The signature of any General Partner shall be necessary and sufficient to convey title to any real property owned by the Partnership or to execute any promissory notes, trust deeds, mortgages, or other instruments of hypothecation, and all of the Partners agree that a copy of this Agreement may be shown to the appropriate parties in order to confirm the same, and further agree that the signature of any General Partner shall be sufficient to execute any "statement of partnership" or other documents

8


 

necessary to effectuate this or any other provision of this Agreement. All of the Partners do hereby appoint each General Partner as their attorney-in-fact for the execution of any or all of the documents described herein.

SECTION 6

ROLE OF LIMITED PARTNERS

        6.1     Limitation on Rights or Powers.     Except as otherwise set forth in Sections 6.2 and 6.3 hereof, no Limited Partner shall have any right or power to take part in the management or control of the Partnership or its business and affairs or to act for or bind the Partnership in any way.

        6.2     Voting Rights.     The Limited Partners shall ha


 
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