Exhibit 10.1
THIRD AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
CBL
& ASSOCIATES LIMITED PARTNERSHIP
June 15, 2005
<PAGE>
TABLE OF CONTENTS
1.1.
DEFINITIONS.......................................................3-24
6/15/05
STOCK SPLIT
ACQUISITION COST
ACT
ADDITIONAL PARTNER
ADDITIONAL UNITS
ADJUSTED CAPITAL CCOUNT
ADMINISTRATIVE EXPENSES
AFFILIATE
AGREEMENT
ASSIGNEE
ASSUMED LIABILITY
AUDITED FINANCIAL STATEMENTS
BANKRUPTCY
BASIC DISTRIBUTION AMOUNT
BENEFICIAL OWNERSHIP
CAPITAL ACCOUNT
CAPITAL CONTRIBUTION
CAPITAL STOCK
CERTIICATE OF LIMITED PARTNERSHIP
CLAIM
CLOSING PRICE
CODE
COMMON STOCK
COMMON STOCK AMOUNT
COMMON UNIT CONVERSION FACTOR
COMMON UNIT DISTRIBUTION AMOUNT
CONSTRUCTIVE OWNERSHIP
CONTRIBUTING PARTNER
CONTROL
CONVERSION FACTOR
CURRENT PER SHRE MARKET PRICE
DEMAND NOTICE
DEPRECIATION
ENTITY
ERISA
EXCHANGE NOTICE
FIRST RESTATED AGREEMENT
FLOOR DISTRIBUTION
GENERAL PARTNER
GROSS ASSET VALUE
GROSS INCOME
IMMEDIATE FAMILY
INCENTIVE OPTION
INCENTIVE OPTION AGREEMENT
<PAGE>
JACOBS LIMITED PARTNER REPRESENTATIVE
JACOBS PROPERTY
JOINT VENTURE PARTNERSHIP
JRI
LIENS
LIMITED PARTNER REPRESENTATIVES
LIMITED PARTNERS
LIQUIDATING TRANSACTION
LIQUIDATING TRUSTEE
L-SCUS
L-SCU BASIC DISTRIBUTION AMOUNT
MAJOR DECISIONS
MAJORITY-IN-INTEREST OF THE LIMITED PARTNERS
MANAGEMENT AGREEMENT
MANAGEMENT COMPANY
MASTER CONTRIBUTION AGREEMENT
MINIMUM GAIN ATTRIBUTABLE TO PARTNER NONRECOURSE DEBT
NET CAPITAL GAIN
NET CASH FLOW
NET FINANCING PROCEEDS
NET INCME OR NET LOSS
NET SALE PROCEEDS
NONRECOURSE DEDUCTIONS
NONRECOURSE LIBABILITIES
OFFERED UNITS
OFFICE BUILDING
OWNERSHIP LIMIT
PARTNER NONRECOURSE DEBT
PARTNER NONRECOURSE DEDUCTIONS
PARTNERS
PARTNERSHIP
PARTNERSHIP MINIMM GAIN
PARTNERSHIP UNITS
PERSON
PREFERRED CONTRIBUTED FUNDS
PREFERRED DISTRIBUTION REQUIREMENT
PREFERRED DISTRIBUTION SHORTFALL
PREFERRED REDEMPTION AMOUNT
PREFERRED REDEMPTION PRICE
PREFERRED STOCK
PREFERRED UNIT DESIGNATION
PREFERRED UNIT ISSUE PRICE
PREFERRED UNITS
PROPERTIES
PROPERTY PARTNERSHIPS
QUALIFIED INDIVIDUAL
REDUCTION FACTOR
REGISTERED AGENT
<PAGE>
REGISTERED OFFICE
REGULATIONS
REGULATORY ALLOCATIONS
REIT
REIT EXPENSES
REIT REQUIREMENTS
REQUESTING PARTY
RELATED ISSUE
RESPONDING PARTY
RIGHTS
SAFE HARBOR RATE
SCUS
SEC
SECOND RESTATED AGREEMENT
SECURITIES ACT
SERIES J EXCHANGE NOTICE
SERIES J.
EXCHANGE RIGHTS
SERIES J OFFERED UNITS
SERIES L EXCHANGE NOTICE
SERIES L EXCHANGE RIGHTS
SERIES L OFFERED UNITS
SERIES S EXCHANGE NOTICE
SERIES S EXCHANGE RIGHTS
SERIES S OFFERED UNITS
S-SCUS
S-SCU BASIC DISTRIBUTION AMOUNT
STOCK INCENTIVE PLAN
SUBSTITUTED LIMITED PARTNER
TAX ITEMS
TRADING DAY
TRANSFER
1.2. EXHIBITS,
ETC.......................................................24
1.3. LIMITED PARTNER
ACCEPTANCE..........................................24
ARTICLE II. ORGANIZATION
2.1.
CONTINUATION........................................................26
2.2.
NAME................................................................27
2.3. CHARACTER OF THE
BUSINESS...........................................27
2.4. LOCATION OF THE
PRINCIPAL PLACE OF BUSINESS.........................27
2.5. REGISTERED AGENT
AND REGISTERED OFFICE..............................27
ARTICLE III. TERM
3.1.
COMMENCEMENT........................................................27
3.2.
DISSOLUTION.........................................................27
<PAGE>
ARTICLE IV. CONTRIBUTIONS TO CAPITAL
4.1.
PARTNERS............................................................28
4.2. GENERAL PARTNER
CAPITAL CONTRIBUTION................................28
4.3. LIMITED PARTNER
CAPITAL CONTRIBUTIONS...............................29
4.4. ISSUANCE OF
ADDITIONAL UNITS........................................30
4.5......ADMISSION OF ADDITIONAL
PARTNERS....................................34
4.6. STOCK INCENTIVE
PLAN................................................34
4.7. NO THIRD PARTY
BENEFICIARY..........................................34
4.8. NO INTEREST; NO
RETURN..............................................35
4.9. ADJUSTMENT UPON
CONVERSION OF PREFERRED STOCK.......................35
ARTICLE V. REPRESENTATIONS, WARRANTIES AND COVENANTS
5.1. REPRESENTATIONS
AND WARRANTIES......................................35
5.2.
COVENANTS...........................................................36
ARTICLE V. ALLOCATIONS,
DISTRIBUTIONS, AND OTHER TAX AND ACCOUNTING MATTERS
6.1.
ALLOCATIONS.........................................................36
6.2......DISTRIBUTIONS.......................................................36
6.3. BOOKS OF
ACCOUNT....................................................43
6.4.
REPORTS.............................................................43
6.5.
AUDITS..............................................................44
6.6. TAX ELECTIONS
AND RETURNS...........................................44
6.7. TAX MATTERS
PARTNER.................................................44
ARTICLE VII. RIGHTS, DUTIES AND RESTRICTIONS
OF THE GENERAL PARTNER
7.1. EXPENDITURES BY
PARTNERSHIP.........................................45
7.2. POWERS AND
DUTIES OF GENERAL PARTNER................................46
7.3. MAJOR
DECISIONS.....................................................49
7.4. ACTIONS WITH
RESPECT TO CERTAIN DOCUMENTS...........................50
7.5. RELIANCE BY
THIRD PARTIES...........................................50
7.6. COMPANY
PARTICIPATION...............................................51
7.7.
PROSCRIPTIONS.......................................................51
7.8. ADDITIONAL
PARTNERS.................................................51
7.9. TITLE
HOLDER........................................................52
7.10. COMPENSATION OF THE
GENERAL PARTNER.................................52
7.11. WAIVER AND
INDEMNIFIATION...........................................52
7.12. LIMITED PARTNER
REPRESENTATIVES.....................................53
7.13. OPERATION IN
ACCORDANCE WITH REIT REQUIREMENTS......................54
7.14. TRANSACTIONS WITH
AFFILIATES........................................55
7.15. OTHER MATTERS
CONCERNING THE GENERAL PARTNER........................55
<PAGE>
ARTICLE VIII. DISSOLUTION, LIQUIDATION AND WINDING-UP
8.1.
ACCOUNTING..........................................................56
8.2. DISTRIBUTION ON
DISSOLUTION.........................................57
8.3. TIMING
REQUIREMENTS.................................................57
8.4. SALE OF
PARTNERSHIP ASSETS..........................................57
8.5. DISTRIBUTIONS IN
KIND...............................................58
8.6. DOCUMENTATION OF
LIQUIDATION........................................58
8.7. LIABILITY OF THE
LIQUIDATING TRUSTEE................................58
ARTICLE IX. TRANSFER OF PARTNERSHIP UNITS
9.1. GENERAL PARTNER
TRANSFER............................................59
9.2. TRANSFERS BY
LIMITED PARTNERS.......................................60
9.3. RESTRICTIONS ON
TRANSFER............................................63
ARTICLE X. RIGHTS AND OBLIGATIONS OF THE LIMITED PARTNERS
10.1. NO PARTICIPATION IN
MANAGEMENT......................................65
10.2. BANKRUPTCY OF A
LIMITED PARTNER.....................................66
10.3. NO
WITHDRAWAL.......................................................67
10.4. DUTIES AND
CONFLICTS................................................67
10.5. LIMITED
LIABILITY...................................................67
ARTICLE XI. GRANT OF RIGHTS TO LIMITED PARTNERS
11.1. GRANT OF
RIGHTS.....................................................67
11.2 TERMS OF
RIGHTS.....................................................68
ARTICLE XII. INDEMNIFICATION
12.1. INDEMNIFICATION OF THE LIMITED
PARTNERS................................69
12.2 INDEMNIFICATION OF THE GENERAL
PARTNER, THE COMPANY
AND
OTHERS.............................................................69
ARTICLE XIII. ARBITRATION OF DISPUTES
13.1.
ARBITRATION.........................................................69
13.2.
PROCEDURES..........................................................70
13.3. BINDING
CHARACTER...................................................71
13.4
EXCLUSIVITY.........................................................71
13.5 NO ALTERATION OF
AGREEMENT..........................................71
ARTICLE
XIV. GENERAL PROVISIONS
14.1.
NOTICES.............................................................71
14.2.
SUCCESSOR...........................................................72
14.3. EFFECT AND
INTERPRETATION...........................................72
<PAGE>
14.4.
COUNTERPARTS........................................................72
14.5. PARTNERS NOT
AGENTS.................................................72
14.6. ENTIRE UNDERSTANDING,
ETC...........................................73
14.7.
AMENDMENTS..........................................................78
14.8.
SEVERABILITY........................................................78
14.9. PRONOUNTS AND
HEADINGS..............................................78
14.10.
ASSURANCES..........................................................78
14.11.
EXPENSES............................................................78
14.12. WAIVER OF
PARTITION.................................................78
ATTACHMENTS:
1-A, 10B AND 1-C - LIMITED PARTER
ACCEPTANCE FORMS
EXHIBITS
A
LIST OF PARTNERS, PERCENTAGE INTEREST, SHARE EQUIVALENTS
B
PREFERRED UNIT DESIGNATIONS
C
ALLOCATIONS
D
RIGHTS TERMS
E
TERMS OF SCUS
F
EXCHANGE RIGHTS OF COMMON UNITS ISSUED IN EXCHANGE FOR OR UPON
REDEMPTION OF SCUS
G
JACOBS LIMITED PARTNER REPRESENTATIVE
H
TERMS OF S-SCUS
I
EXCHANGE RIGHTS OF COMMON UNITS ISSUED IN EXCHANGE FOR OR UPON
REDEMPTION OF S-SCUS
J
TERMS OF L-SCUS
<PAGE>
THE PARTNERSHIP UNITS REFERRED TO IN THIS
AGREEMENT HAVE NOT
BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES
ACT"), OR ANY
STATE SECURITIES LAWS. ACCORDINGLY, NO
PARTNERSHIP UNITS MAY BE RESOLD, PLEDGED,
HYPOTHECATED OR OTHERWISE TRANSFERRED UNLESS SUBSEQUENTLY
REGISTERED UNDER
THE
SECURITIES ACT AND ANY APPLICABLE
STATE SECURITIES LAWS,
OR UNLESS AN EXEMPTION
FROM REGISTRATION IS AVAILABLE, AND UNLESS THE OTHER TRANSFER RESTRICTIONS
CONTAINED HEREIN HAVE BEEN SATISFIED. REFERENCE IS MADE TO ARTICLE IX OF
THIS
AGREEMENT FOR PROVISIONS RELATING TO VARIOUS RESTRICTIONS ON THE SALE OR
OTHER
TRANSFER OF THESE PARTNERSHIP UNITS.
THIRD AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP OF
CBL & ASSOCIATES LIMITED PARTNERSHIP
THIS THIRD
AMENDED AND RESTATED
AGREEMENT OF LIMITED
PARTNERSHIP is
made
and entered into as of the 15th day of June,
2005 by and among CBL
Holdings I,
Inc., a Delaware corporation, and those certain Persons
identified on Exhibit A
attached hereto as a Limited Partner.
W I T N E S S E T H:
WHEREAS, CBL & Associates Limited Partnership (the
"Partnership") was
formed by that certain Agreement of Limited
Partnership dated October 29, 1993,
as amended and restated in its entirety by
that certain Amended and Restated
Agreement of Limited Partnership dated
November 3, 1993, and further amended by
that certain Modification No. One to the
Amended and Restated Agreement of
Limited Partnership dated March 31, 1997
and by the Modification No. Two to the
Amended and Restated Agreement of Limited
Partnership dated February 19, 1998,
(together, the "First Restated Agreement");
and
WHEREAS, the First Restated Agreement was amended in its entirety
and
the parties entered into the Second Amended
and Restated Agreement of Limited
Partnership dated June 30, 1998, as amended
by the First Amendment dated January
1
<PAGE>
31, 2001, the Second Amendment dated
February 15, 2002, the Third Amendment
dated July 28, 2004 and the Fourth
Amendment dated June 1, 2005 (all of the
foregoing constituting and being herein
referred to as the "Second Restated
Agreement"); and
WHEREAS, on May 10, 2005, the board of directors of CBL &
Associates
Properties, Inc., a Delaware corporation
(herein referred to as the "Company")
declared a two-for-one stock split of the
Company's common stock (the "6/15/05
Stock Split") and declared a stock dividend
of one share of common stock for
each outstanding share of the Company's
common stock as the means through which
to effect the 6/15/05 Stock Split and such
stock dividend was paid to the
Company's common shareholders on June 15,
2005; and
WHEREAS, on June 15, 2005 and due to the structure of the
Partnership
and the 6/15/05 Stock Split, the
Partnership distributed to its Partners holding
Common Units, SCUs, S-SCUs and L-SCUs an
additional Partnership Unit
corresponding to the type of Partnership
Unit held by such Partner at the time;
and
WHEREAS, Section 14.7 of the Second Restated Agreement provides
that
the General Partner shall have the power,
without consent of any Limited
Partner, to amend the Second Restated
Agreement as may be required to facilitate
or implement, inter alia, any change that
does not adversely affect the Limited
Partners in any material respect, to cure
any ambiguity, to correct or
supplement any defective provision in the
Second Restated Agreement, or to make
other changes with respect to matters
arising under the Second Restated
Agreement that will not be inconsistent
with any other provision of the Second
Restated Agreement; and
WHEREAS, the General Partner has determined to amend the Second
Restated Agreement in its entirety as set
forth in this Third Amended and
Restated Agreement for the purposes of (i)
reflecting the 6/15/05 Stock Split
2
<PAGE>
and corresponding distribution of
Partnership Units as described above and (ii)
incorporating the terms and provisions of
the documents constituting the Second
Restated Agreement into one agreement as
set forth herein (the "Third Restated
Agreement").
NOW, THEREFORE, the General Partner hereby amends and restates
the
Second Restated Agreement in its entirety
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:
"6/15/05 Stock Split" shall mean the stock split referred to in
the
Whereas clauses above as declared by the
Company's board of directors on May 10,
2005 and effected on June 15, 2005.
"Accountants" shall mean the firm or firms of independent
certified
public accountants selected by the General
Partner on behalf of the Partnership
to audit the books and records of the
Partnership (and, to the extent provided
under the applicable Joint Venture
Partnership agreement, the Joint Venture
Partnerships) and to prepare statements and
reports in connection therewith.
"Acquisition Cost" shall have the meaning set forth in Section
4.2(b)
hereof.
"Act" shall mean the Revised Uniform Limited Partnership Act as
enacted
in the State of Delaware, and as the same
may hereafter be amended from time to
time.
"Additional Partner" shall have the meaning set forth in Section
4.4(a)
hereof. "Additional Units" shall have the meaning set forth in
Section
4.4(a) hereof.
"Adjusted Capital Account Deficit" shall mean with respect to
any
Partner, the deficit balance, if any, in
such Partner's Capital Account as of
3
<PAGE>
the end of the relevant fiscal year, after
giving effect to the following
adjustments:
(i) Such Capital Account shall be deemed to be increased by
any amounts which such Partner is obligated to restore to the
Partnership (pursuant to this Agreement or otherwise) or is deemed
to
be obligated to restore pursuant to the second to last sentence
of
Regulation Section 1.704-2(g)(i) and Section 1.704-2(i)(5)
(relating to
allocations attributable to nonrecourse debt); and
(ii) Such Capital Account shall be deemed to be decreased by
the items described in Regulation Section 1.704-1(b)(2)(ii)(d)(4),
(5)
and
(6).
The foregoing definition of Adjusted
Capital Deficit is intended to comply with
the provisions of Regulation Section
1.704-1(b)(2)(ii)(d) and shall be
interpreted and applied consistently
therewith.
"Administrative Expenses" shall mean (i) all administrative and
operating costs and expenses incurred by
the Partnership, (ii) all
administrative, operating and other costs
and expenses including any deficits
incurred by the Property Partnerships and
to be paid, advanced or reimbursed by
the partnership pursuant to the partnership
agreements of such Property
Partnerships, (iii) those administrative
costs and expenses of the Company and
the General Partner, including salaries
paid to officers of the Company and the
General Partner, and accounting and legal
expenses undertaken by the Company and
the General Partner on behalf or for the
benefit of the Partnership, (iv) all
amounts paid or advanced by the Partnership
to the Management Company pursuant
to the Management Agreement, and (v) to the
extent not included in clause (iii)
above, REIT Expenses.
"Affiliate" shall mean, with respect to any Partner (or as to any
other
Person the affiliates of whom are relevant
for purposes of any of the provisions
of this Agreement), (i) any member of the
Immediate Family of such Partner; (ii)
any Entity in which such Person owns of
record and beneficially a majority of
the capital or economic interests; or (iii)
any Entity which directly or
indirectly through one or more
intermediaries, Controls, is Controlled by, or is
under common Control with, such
Partner.
4
<PAGE>
"Agreement" shall mean this Third Amended and Restated Agreement
of
Limited Partnership, as originally executed
and as hereafter amended, modified,
supplemented or restated from time to time
as the context requires.
"Assignee" shall mean a Person to whom one or more Partnership
Units
have been transferred, but who has not
become a Substituted Limited Partner.
"Assumed Liability" shall mean any liability of a Limited Partner
or an
Affiliate thereof assumed by the
Partnership pursuant to Section 13.1 of the
First Restated Agreement.
"Audited Financial Statements" shall mean financial statements
(balance
sheet, statement of income, statement of
partners' equity and statement of cash
flows) prepared in accordance with
generally accepted accounting principles and
accompanied by an independent auditor's
report containing an opinion thereon.
"Bankruptcy" shall mean, with respect to any Person, (i) the
commencement by such Person of any
proceeding seeking relief under any provision
or chapter of the federal Bankruptcy Code,
U.S.C. ss.101 et. seq., as the same
may be amended from time to time, or any
other federal or state law relating to
insolvency, bankruptcy or reorganization,
(ii) an adjudication that such Person
is insolvent or bankrupt, (iii) the entry
of an order for relief under the
federal Bankruptcy Code with respect to
such Person, (iv) the filing of any such
petition or the commencement of any such
case or proceeding against such Person,
unless such petition and the case or
proceeding initiated thereby are stayed or
dismissed within ninety (90) days from the
date of such filing, (v) the filing
of an answer by such Person admitting the
allegations of any such petition, (vi)
the appointment of a trustee, receiver or
custodian for all or substantially all
of the assets of such Person unless such
appointment is stayed, vacated or
dismissed within ninety (90) days from the
date of such appointment, (vii) the
5
<PAGE>
execution by such Person of a general
assignment for the benefit of creditors,
(viii) the levy, attachment, execution, or
other seizure of substantially all of
the assets of such Person where such
seizure is not discharged within thirty
(30) days thereafter, (ix) the admission by
such Person in writing of its
inability generally to pay its debts as
they mature or that it is generally not
paying its debts as they become due, or (x)
the taking of any corporate or
partnership action in connection with any
of the foregoing.
"Basic Distribution Amount" shall mean $0.725625 (but shall
mean
$0.3628125 after the 6/15/05 Stock Split);
provided, however, that such amount
will be adjusted approximately to account
for any further unit. splits,
combinations or other similar events with
respect to the SCUs.
"Beneficial Ownership" shall have the meaning set forth in the
certificate of incorporation of the
Company.
"Capital Account" shall mean, with respect to any partner, the
separate
"book" account which the Partnership shall
establish and maintain for such
Partner in accordance with Section 704(b)
of the Code and Section 1.704-1(b)
(2) (iv) of the Regulations and such other
provisions of Section 1.704-1(b) of
the Regulations that must be complied with
in order for the Capital Accounts
to be determined in accordance with the
provisions of said Regulations. In
furtherance of the foregoing, the Capital
Accounts shall be maintained in
compliance with Section 1.704-1 (b) (2)
(iv) of the Regulations; and the
provisions hereof shall be interpreted and
applied in a manner consistent
therewith. In the event that a Partnership
Unit is transferred in accordance
with the terms of this Agreement, the
Capital Account, at the time of the
transfer, of the transferor attributable to
the transferred interest shall carry
over to the transferee. For the
avoidance of doubt, distributions pursuant
to an exercise for an option set forth in a
JRI Option Agreement entered into
in connection with the Master Contribution
Agreement shall not result in
6
<PAGE>
any reduction in Capital Accounts.
"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 Units held
by such Partner (net of liabilities to
which such property is subject).
"Capital Stock" means Common Stock, Preferred Stock and other
classes
and series of capital stock issued from
time to time by the Company.
"Certificate of Limited Partnership" shall mean the Certificate
of
Limited Partnership establishing the
Partnership, filed with the office of the
Secretary of State of the State of Delaware
on July 16, 1993, as it may be
amended from time to time in accordance
with the terms of this Agreement and the
Act.
"Claim" shall have the meaning set forth in Section 12.1
hereof.
"Closing Price" on any date shall mean the last sale price,
regular
way, or, in case no such sale takes place
on such day, the average of the
closing bid and asked prices, regular way,
in either case as reported in the
principal consolidated transaction
reporting system with respect to securities
listed or admitted to trading on the New
York Stock Exchange or, if the Common
Stock is not listed or admitted to trading
on the New York Stock Exchange, as
reported in the principal consolidated
transaction reporting system with respect
to securities listed on the principal
national securities exchange on which the
Common Stock is listed or admitted to
trading or, if the Common Stock is not
listed or admitted to trading on any
national securities exchange, the last
quoted price, or if not so quoted, the
average of the high bid and low asked
prices in the over-the-counter market, as
reported by the National Association
of Securities Dealers, Inc. Automated
Quotations System or, if such system is no
7
<PAGE>
longer in use, the principal other
automated quotations system that may then be
in use or, if the Common Stock is not
quoted by any such organization, the
average of the closing bid and asked prices
as furnished by a professional
market maker making a market in the Common
Stock as such person is selected from
time to time by the General Partner.
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
"Common Stock" shall mean the shares of the common stock, par
value
$.01 per share, of the Company.
"Common Stock Amount" shall mean, with respect to any number of
Common
Units, SCUs, S-SCUs or L-SCUs, the number
of shares of Common Stock equal to
such number of Common Units, SCUs, S-SCUs
or L-SCUs, as the case may be,
multiplied by the Conversion Factor;
provided, however, that in the event that
the Company issues to all holders of Common
Stock rights, options, warrants
or convertible or exchangeable securities
entitling the shareholders to
subscribe for or purchase additional Common
Stock, or any other securities
or property of the Company, the value of
which is not included in the first
sentence of the definition of Closing Price
of the shares of Common Stock
(collectively, "additional rights"), other
than a right to receive a divided
or other distribution of Common Stock that
corresponds to Common Units
issued to the Company pursuant to a
Distribution of Common Units in
Lieu of Cash, then the Common Stock Amount
shall also include, other than with
respect to any Common Units, SCUs, S-SCUs
or L-SCUs "beneficially owned" by an
"Acquiring Person" (as such terms are
defined in the Company's Rights Agreement,
dated as of April 30, 1999, as amended and
as it may be further amended from
time to time, and any successor agreement
thereto), such additional rights that
a holder of that number of shares of Common
Stock would be entitled to receive.
8
<PAGE>
"Common Unit Conversion Factor" shall mean 1.0, provided, that, in
the
event that the Partnership (i) makes a
distribution to all holders of its Common
Units in Common Units (other than a
distribution of Common Units pursuant to an
offer to all holders of Common Units, SCUs,
S-SCUs and L-SCUs permitting each to
elect to receive a distribution in Common
Units in lieu of a cash distribution
(such a distribution of Common Units is
referred to herein as a "Distribution of
Common Units in Lieu of Cash")), (ii)
subdivides or splits its outstanding
Common Units (which shall expressly exclude
any Distribution of Common Units in
Lieu of Cash), or (iii) combines or reverse
splits its outstanding Common Units
into a smaller number of Common Units (in
each case, without making a comparable
distribution, subdivision, split,
combination or reverse split with respect to
the SCUs, S-SCUs and L-SCUs), the Common
Unit Conversion Factor in effect
immediately preceding such event shall be
adjusted by multiplying the Common
Unit Conversion Factor by a fraction, the
numerator of which shall be the number
of Common Units issued and outstanding on
the record date for such distribution,
subdivision, split, combination or reverse
split (assuming for such purposes
that such distribution, subdivision, split,
combination or reverse split
occurred as of such time), and the
denominator of which shall be the actual
number of Common Units (determined without
the above assumption) issued and
outstanding on the record date for such
distribution, subdivision, split,
combination or reverse split. Any
adjustment to the Common Unit Conversion
Factor shall become effective immediately
after the record date for such event
in the case of a distribution or the
effective date in the case of a
subdivision, split, combination or reverse
split.
"Common Unit Distribution Amount" shall mean the product of (i)
the
quarterly distribution paid with respect to
one Common Unit for that quarter
pursuant to Section 6.2(a)(v) hereof
multiplied by (ii) Common Unit Conversion
Factor.
9
<PAGE>
"Common Units" shall mean the ownership interest of Partner in
the
Partnership from time to time, which
entitles a Partner to the allocations
specified in Section 6 hereof and all
distributions from the Partnership, and
its rights of management, consent,
approval, or participation, if any, as
provided in this Agreement. The number of
Common Units held by each Partner the
date hereof and the percentage of the total
number of outstanding Units
represented thereby is as set forth
opposite such Partner's name on Exhibit A
hereto. Common Units do not include
Preferred Units. As the context may require
herein, Common Units may include the SCUs,
S-SCUs and L-SCUs.
"Company"
shall mean CBL & Associates Properties, Inc., a Delaware
corporation, and any successor entity
thereto.
"Consent of the Limited Partners" shall mean the written
consent
Majority-In-Interest of the Limited
Partners, which consent shall be
obtained prior to the taking of any action
for which it is required by this
Agreement and may be given or
withheld by a Majority-In-Interest of the
Limited Partners, unless otherwise
expressly provided herein, in their sole
and absolute discretion.
"Constructive Ownership" shall have the meaning set forth in
the
certificate of incorporation of the Company.
"Contributed Property" shall have the meaning set forth in
Section 4.2(b) hereof.
"Contributing Partner" shall have the meaning set forth in
Section
4.4(b) hereof.
"Control" shall mean the ability, whether by the direct or
indirect
ownership of shares or other equity
interests, by contract or otherwise, to
elect a majority of the directors of a
corporation, to select the managing
partner of a partnership or otherwise to
select, or have the power to remove
and then select, a majority of those
persons exercising governing authority over
10
<PAGE>
an Entity. In the case of a limited
partnership, the
sole general partner, all of the general
partners to the extent each has equal
management control and authority, or the
managing general partner or managing
general partners thereof shall be deemed to
have control of such partnership
and, in the case of a trust, any trustee
thereof or any Person having the right
to select any such trustee shall be deemed
to have control of such trust.
"Conversion Factor" shall mean 1.0, provided that in the event that
the
Company (i) pays a dividend on its
outstanding shares of Common Stock in shares
of Common Stock or makes a distribution to
all holders of its outstanding Common
Stock in shares of Common Stock (in either
case other than a dividend or other
distribution of shares of Common Stock that
corresponds to Common Units issued
to the Company pursuant to a Dividend of
Common Units in Lieu of Cash), (ii)
subdivides or splits its outstanding shares
of Common Stock, or (iii) combines
or reverse splits its outstanding shares of
Common Stock into a smaller number
of shares of Common Stock (in each case,
without making a comparable dividend,
distribution, subdivision, split,
combination or reverse split with respect to
the Common Units, the SCUs, S-SCUs or
L-SCUs), the Conversion Factor in effect
immediately preceding such event shall be
adjusted by multiplying the Conversion
Factor by a fraction, the numerator of
which shall be the number of shares of
Common Stock issued and outstanding on the
record date for such dividend,
distribution, subdivision, split,
combination or reverse split (assuming for
such purposes that such dividend,
distribution, subdivision, split, combination
or reverse split occurred as of such time),
and the denominator of which shall
be the actual number of shares of Common
Stock (determined without the above
assumption) issued and outstanding on the
record date for such dividend,
distribution, subdivision, split,
combination or reverse split. Any adjustment
to the Conversion Factor shall become
effective immediately after the record
11
<PAGE>
date for such event in the case of the
dividend or distribution of the effective
date in the case of a subdivision, split,
combination or reverse split.
"Current Per Share Market Price" on any date shall mean the average
of
the Closing Price for the five consecutive
Trading Days ending on and including
such date (or if such date is not a Trading
Day, ending on the immediately
preceding Trading Day).
"Demand Notice" shall have the meaning set forth in Section
13.2
hereof.
"Depreciation" shall mean, with respect to any asset of the
Partnership
for any fiscal year or other period, the
depreciation, depletion or
amortization, as the case may be, allowed
or allowable for federal income tax
purposes in respect of such asset for such
fiscal year or other period;
provided, however, that if there is a
difference between the Gross Asset Value
and the adjusted tax basis of such asset,
Depreciation shall mean "book
depreciation, depletion or amortization" as
determined under Section 1.704-l (b)
(2) (iv) (g) (3) of the Regulations.
"Entity" shall mean any general partnership, limited
partnership,
corporation, joint venture, limited
liability company, trust, business trust,
cooperative or association.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974,
as amended from time to time (or any
corresponding provisions of succeeding
laws).
"Exchange Notice" shall have the meaning set forth in Schedule 1
to
Exhibit D.
"First Restated Agreement" shall have the meaning set forth in
the
preamble to this Agreement.
"Floor Distribution" shall mean, with respect to any quarter,
$0.4375
(but shall mean $0.21875 after the 6/15/05
Stock Split).
"General Partner" shall mean CBL Holdings I, Inc., a Delaware
corporation, its duly admitted successors
and assigns and any other Person who
is a general partner of the Partnership
12
<PAGE>
at the time of reference thereto.
"Gross Asset Value" shall mean, with respect to any asset of
the
Partnership, such asset's adjusted basis
for federal income tax purposes, except
as follows:
(a) the 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 under Article IV;
(b) if the General Partner reasonably determines that an
adjustment is necessary or appropriate to reflect the relative
economic
interests of the Partners, 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, as of
the
following times:
(i) a Capital Contribution (other than a de
minimis Capital Contribution) to the Partnership by a new or
existing Partner as consideration for Partnership Units;
(ii) the distribution by the Partnership to a
Partner of more than a de minimis amount of Partnership
property
as consideration for the redemption of Partnership Units; and
(iii) the liquidation of the Partnership within
the meaning of Section 1.704-1(b)(2)(ii)(g) of the Regulations;
(c) the Gross Asset Values of Partnership assets distributed
to any Partner shall be the gross fair market values of such
assets
(taking Section 7701(g) of the Code into account) as reasonably
determined by the General Partner as of the date of distribution;
and
(d) 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 Sections 734(b) or 743(b) of the
Code,
but only to the extent that such adjustments are taken into account
in
determining Capital Accounts pursuant to Section 1.704-1(b) (2)
(iv)
(m) of the Regulations; provided, however, that Gross Asset
Values
shall not be adjusted pursuant to this paragraph to the extent that
the
General Partner reasonably determines that an adjustment pursuant
to
subparagraph (b) above is necessary or appropriate in connection
with a
transaction that would otherwise result in an adjustment pursuant
to
this subparagraph (d).
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
Net Income and Net Loss. Any
13
<PAGE>
adjustment to the Gross Asset Values of
Partnership
property shall require an adjustment to the
Partners' Capital Accounts; as for
the manner in which such adjustments are
allocated to the Capital Accounts, see
subparagraph (c) of the definition of Net
Income and Net Loss in the case of
adjustment by Depreciation, and
subparagraph (d) of said definition in all other
cases.
"Gross Income" shall mean, for each fiscal year or other
applicable
period, an amount equal to the
Partnership's gross income for such year or
period as determined for federal income tax
purposes with the following
adjustments: (a) by including as an item of
gross income any tax-exempt income
received by the Partnership; (b) gain
resulting from any disposition of
Partnership property with respect to which
gain recognized for federal income
tax purposes shall be computed by reference
to the Gross Asset Value of such
property rather than its adjusted tax
basis; (c) in the event of an adjustment
of the Gross Asset Value of any Partnership
asset which requires that the
Capital Accounts of the Partnership be
adjusted pursuant to Regulation Section
1.704 l(b)(2)(iv)(e), (f) or (m), the
amount of such positive adjustment is to
be taken into account additional Gross
Income pursuant to Exhibit C; and (d)
excluding any items specifically allocated
pursuant to Section 2 of Exhibit C.
"Immediate Family" shall mean, with respect to any Person, such
Person's spouse, parents, or descendants by
blood or adoption.
"Incentive Option" means an option to purchase Common Stock
granted
under the Stock Incentive Plan.
"Incentive Option Agreement" means the form of Incentive Option
Agreement to be used under the Stock
Incentive Plan.
"Jacobs Limited Partner Representative" shall have the meaning
set
forth in Section 7.12 hereof.
14
<PAGE>
"Jacobs Property" shall have the meaning set forth in Section
6.2(d)(1)
hereof.
"Joint Venture Partnership" shall mean any Property Partnership
in
which the Partnership and the Company do
not own, directly or indirectly, 100%
of the ownership interests in the
aggregate.
"JRI" shall mean Jacobs Realty Investors Limited partnership, a
Delaware limited partnership.
"Liens" shall mean any liens, security interests, mortgages, deeds
of
trust, charges,
claims, encumbrances, pledges, options, rights of first
offer or first
refusal and any other similar encumbrances of any nature
whatsoever.
"Limited Partner Representative" shall mean, with respect to
any
Limited Partner, the representative
appointed by such Limited Partner pursuant
to the first sentence of Section 7.12 or,
if none, such Limited Partner.
"Limited Partners" shall mean (i) those Persons listed under
the
heading "Limited Partners" on Exhibit A
hereto in their respective capacities as
limited partners of the Partnership, their
permitted successors and assigns and
(ii) all Additional Partners and
Substituted Limited Partners.
"Liquidation Transaction" shall mean any sale of assets of the
Partnership in contemplation of, or in
connection with, the liquidation of the
Partnership.
"Liquidating Trustee" shall mean the General Partner or, if the
General
Partner is unable or unwilling to serve in
such capacity, such other individual
or Entity which, with the Consent of the
Limited Partners or otherwise under the
Act, shall be charged with winding up the
Partnership.
"L-SCUs" shall have the meaning set forth in Exhibit J.
15
<PAGE>
"L-SCU Basic Distribution Amount" shall mean, with respect to an
L-SCU,
$1.5144 (but shall mean $.7572 after the
6/15/05 Stock Split); provided,
however, that such amount will be adjusted
appropriately to account for any
further unit splits, combinations or other
similar events with respect to the
L-SCUs.
"Major Decisions" shall have the meaning set forth in Section
7.3
hereof.
"Majority-In-Interest of the Limited Partners" shall mean
Limited
Partner(s) who hold in the aggregate more
than fifty percent (50%) of the voting
rights associated with the then outstanding
Partnership Units which are entitled
to vote on the matter with respect to which
such calculation is made, as a
class.
"Management Agreement" shall mean the Management Agreement
dated
November 3, 1993 between the Management
Company and the Partnership, as such may
be amended or supplemented.
"Management Company" shall mean CBL & Associates Management,
Inc., a
Delaware corporation, or its permitted
successors or assigns.
"Master Contribution Agreement" shall mean the Master Agreement
dated
as of September 25, 2000, among the
Company, the Partnership, JRI and certain
other persons named therein as amended by
the Letter Agreement, dated November
13, 2000, and the Amendment to the Master
Contribution Agreement, dated as of
December 19, 2000, and as the same may be
further amended, modified or
supplemented.
"Minimum Gain Attributable to Partner Nonrecourse Debt" shall
mean
"partner nonrecourse debt minimum gain" as
determined in accordance with
Regulation Section 1.704-2(i)(2).
16
<PAGE>
"Net Capital Gain" shall mean, for any taxable year, the excess
of
recognized gains with respect to
dispositions of Property over recognized losses
with respect to dispositions of Property
over recognized losses with respect to
dispositions of Property, in each case as
determined by reference to Gross Asset
Value.
"Net Cash Flow" shall mean, with respect to any fiscal period of
the
Partnership, the excess, if any, of
"Receipts" over "Expenditures." For purposes
hereof, the term "Receipts" means the sum
of all cash receipts of the
Partnership from all sources for such
period (including Net Sale Proceeds and
Net Financing Proceeds but excluding
Capital Contributions) and any amounts held
as reserves as of the last day of such
period which the General Partner
reasonably deems to be in excess of
necessary reserves as determined below. The
term "Expenditures" means the sum of (a)
all cash expenses of the Partnership
for such period, (b) the amount of all
payments of principal of, premium, if
any, and interest on account of any
indebtedness of the Partnership including
payments of principal of, premium, if any,
and interest on account of General
Partner loans, on amounts due on such
indebtedness during such period, and (c)
such additions to cash reserves as of the
last day of such period as the General
Partner deems necessary or appropriate for
any capital, operating or other
expenditure, including, without limitation,
contingent liabilities, but the term
"Expenditures" shall not include any
expense paid from a cash reserve previously
established by the Partnership.
"Net Financing Proceeds" shall mean the cash proceeds received by
the
Partnership in connection with any
borrowing or refinancing of borrowing by or
on behalf of the Partnership or by or on
behalf of any Property Partnership
(whether or not secured), after deduction
of all costs and expenses incurred by
the Partnership or the Property Partnership
in connection with such borrowing,
and after deduction of that portion of such
proceeds used to (i) acquire the
Property with respect to which any such
borrowing was specifically incurred, and
(ii) repay any other indebtedness of the
Partnership or Property Partnerships
with respect to which any such refinancing
or borrowing was specifically
incurred, or any interest or premium
thereon. For this
17
<PAGE>
purpose, cash proceeds
received by a Joint Venture Partnership
shall not be deemed to be received or
available to the Partnership until (i) the
distribution of such proceeds is
actually received by the Partnership, or
(ii) under the terms of the Joint
Venture Partnership's partnership
agreement, the Partnership controls the timing
of the Joint Venture Partnership's
distributions and then only to the extent of
the partnership's entitlement to such
distributions.
"Net Income or Net Loss" shall mean, for each fiscal year or
other
applicable period an amount equal to the
Partnership's net income or loss for
such year or period as determined for
federal income tax purposes by the
Accountants, 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) of
the Code shall be included in taxable
income or loss), with the following
adjustments: (a) by including as an item of
gross income any tax-exempt income received
by the Partnership; (b) by treating
as a deductible expense any expenditure of
the Partnership described in Section
705 (a) (2) (B) of the Code (including
amounts paid or incurred to organize the
Partnership, unless an election is made
pursuant to Code Section 709 (b) or to
promote the sale of interests in the
Partnership and by treating deductions for
any losses incurred in connection with the
sale or exchange of Partnership
property disallowed pursuant to Section 267
(a) (i) or Section 707 (b) of the
Code as expenditures described in Section
705 (a) (2) (B) of the Code; (c) in
lieu of depreciation, depletion,
amortization, and other cost recovery
deductions taken into account in computing
total income or loss, there shall be
taken into account Depreciation; (d) gain
or loss resulting from any disposition
of Partnership property with respect to
which gain or loss is recognized for
federal income tax purposes shall be
computed by reference to the Gross Asset
Value of such property rather than its
adjusted tax basis; (e) in the event of
an adjustment of the Gross Asset Value of
any Partnership asset which requires
that the Capital Accounts of the
Partnership be adjusted pursuant to Regulation
Section 1.704-l (b) (2) (iv) (e) , (f) and
(m), the amount of such adjustment is
to be taken into account as additional Net
Income or Net Loss pursuant to
Exhibit C; and (f) excluding any items
specially allocated pursuant to Section 2
of Exhibit C. Once an item of income, gain,
loss or deduction has been
18
<PAGE>
included in the initial computation of Net
Income or Net Loss or is subject to
the special allocation rules in Exhibit C,
Net Income or net Loss shall be
recomputed without regard to such item.
"Net Sale Proceeds" means the cash proceeds received by or
available to
the Partnership in connection with a sale
or condemnation of, or casualty of or
other capital event with respect to, any
asset by or on behalf of the
Partnership or by or on behalf of a
Property Partnership, after deduction of any
costs or expenses incurred by the
Partnership or a Property Partnership with
respect to, or payable specifically out of
the proceeds of, such transaction
(including, without limitation, any
repayment of any indebtedness required to be
repaid as a result 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, including to a Partner or its
Affiliates). For this purpose, cash
proceeds received by a Joint Venture
Partnership shall not be deemed to be
received or available to the Partnership
until (i) the distribution of such proceeds
is actually received by the
Partnership, or (ii) under the terms of the
Joint Venture Partnership's
partnership agreement, the Partnership
controls the timing of the Joint Venture
Partnership's distributions and then only
to the extent of the Partnership's
entitlement to such distributions.
"Nonrecourse Deductions" shall have the meaning set forth in
Sections
1.704-2(b) (1) and (c) of the
Regulations.
"Nonrecourse Liabilities" shall have the meaning set forth in
Section
1.704-2(b) (3) of the Regulations.
"Offered Units" shall have the meaning set forth in Exhibit D.
"Office Building" shall mean the office building known as CBL
Center
located at 2030 Hamilton Place Boulevard,
Chattanooga, Tennessee 37421.
"Ownership Limit" shall have the meaning set forth in the
certificate
of incorporation of the Company, as the
same may be modified by the board of
directors of the Company as permitted
therein.
19
<PAGE>
"Partner Nonrecourse Debt" shall mean any nonrecourse indebtedness
of
the Partnership that is loaned or
guaranteed by any Partner and/or is treated as
"partner nonrecourse debt" under Section
1.704-2(b) (4) of the Regulations.
"Partner Nonrecourse Deductions" shall have the meaning set forth
in
Section 1.704-2(i) (2) of the
Regulations.
"Partners" shall mean the General Partner and the Limited
Partners,
their duly admitted successors or assigns
or any Person who is a partner of
the Partnership at the time of reference
thereto.
"Partnership" shall mean the limited partnership hereby
constituted, as
such limited partnership may from time to
time be constituted.
"Partnership Minimum Gain" shall have the meaning set forth in
Section
1.704-2(b) (2) of the Regulations.
"Partnership Units" shall mean the Common Units, the Preferred
Units,
the SCUs the S-SCUs and the L-SCUs.
"Person" shall mean any individual or Entity.
"Preferred Contributed Funds" shall have the meaning set forth
in
Section 4.4(b) hereof.
"Preferred Distribution Requirement" shall have the meaning set
forth in Section 4.4(b) hereof.
"Preferred Distribution Shortfall" shall have the meaning set
forth
in Section 6.2(a) (i).
"Preferred Redemption Amount" shall mean, with respect to any class
or
series of Preferred Units, the sum of (i)
the amount of any accumulated
Preferred Distribution Shortfall with
respect to such class or series of
Preferred Units, (ii) the Preferred
Distribution Requirement with respect to
such class or series of Preferred Units to
the date of redemption and (iii)
the Preferred Redemption Price indicated in
the Preferred Unit Designation with
respect to such class or series of
Preferred Units.
20
<PAGE>
"Preferred Redemption Price" shall have the meaning set forth
in
Section 4.4(b) hereof.
"Preferred Stock" shall mean any class of equity securities of
the
Company now or hereafter authorized or
reclassified, other than the Common
Stock, having dividend rights that are
superior or prior to dividends payable on
the Common Stock.
"Preferred Unit Designation" shall have the meaning set forth
in
Section 4.4(b) hereof.
"Preferred Unit Issue Price" shall mean the amount of the funds
contributed or deemed to have been
contributed by the relevant Partner, in
exchange for the preferred Units.
"Preferred Units" shall mean interests in the Partnership
issued
pursuant to Section 4.4 hereof. The holder
of Preferred Units shall have such
rights to the allocations of Net Income or
Net Loss as specified in Section 6.1
hereof and to distributions pursuant to
Section 6.2 hereof, but shall not, by
reason of its ownership of such Preferred
Units, be entitled to participate in
the management of the Partnership or to
consent to or approve any action which
is required by the Act or this Agreement to
be approved by any or all of the
Partners.
"Properties" or "Property" shall mean any real property in which
the
Partnership, directly or indirectly, holds
or acquires ownership of a fee,
mortgage or leasehold interest.
"Property Partnerships" shall mean and include any partnership or
other
Entity in which the Partnership is or
becomes a partner or other equity
participant and which is formed for the
purpose of acquiring, developing or
owning a Property or a proposed
Property.
"Qualified Individual" shall have the meaning set forth in
Section
13.2(b) hereof.
"Reduction Factor" shall mean the lesser of (i) the quotient of
the
Common Unit Distribution Amount for such
quarter divided by the Floor
Distribution and (ii) one.
"Registered Agent" shall have the meaning set forth in Section
2.5
hereof.
"Registered Office" shall have the meaning set forth in Section
2.5
hereof.
21
<PAGE>
"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).
"Regulatory Allocations" shall have the meaning set forth in
Section 2
of Exhibit C.
"REIT" shall mean a real estate investment trust as defined in
Section 856 of the Code.
"REIT Expenses" shall mean (i) costs and expenses relating to
the
formation and continuity of existence of
the Company and the General Partner,
including taxes (other than the Company's
and the General Partner's federal and
state income and franchise taxes), fees and
assessments associated therewith,
any and all costs, expenses or fees payable
to any director or trustee of the
Company; the General Partner or any
subsidiary of either the Company or the
General Partner, (ii) costs and expenses
relating to any offer or registration
of securities by the Company and all
statements, reports, fees and expenses
incidental thereto, including underwriting
discounts and selling commissions
applicable to any such offer of securities,
(iii) costs and expenses associated
with the preparation and filing of any
periodic reports by the Company under
federal, state or local laws or regulations
including filings with the SEC, (iv)
costs and expenses associated with
compliance by the Company and the General
Partner with laws, rules and regulations
promulgated by any regulatory body,
including the SEC, and (v) all other
operating or administrative costs of the
Company and the General Partner incurred in
the ordinary course of its business
on behalf of the partnership.
"REIT Requirements" shall have the meaning set forth in Section
6.2
(d)(1) hereof.
"Requesting Party" shall have the meaning set forth in Section
13.2(a)
hereof.
"Related Issue"
shall mean, with respect to a class or series of
Preferred Units, the class or series of
Preferred Stock the sale of which
directly or indirectly provided a Partner
with the proceeds to contribute to the
Partnership in exchange for such Preferred
Units.
"Responding Party" shall have the meaning set forth in Section
13.2(b)
hereof.
"Rights" shall have the meaning set forth in Section 11.1
hereof.
22
<PAGE>
"Safe Harbor Rate" shall have the meaning set forth in Section
6.2(f) hereof.
"SCUs" shall have the meaning set forth in Exhibit E.
"SEC" shall mean the Securities and Exchange Commission.
"Second Restated Agreement" shall have the meaning set forth in
the
preamble to this Agreement.
"Securities Act" shall mean the Securities Act of 1933, as
amended.
"Series J Exchange Notice" shall have the meaning set forth in
Exhibit E
"Series J Exchange Rights" shall have the meaning set forth in
Exhibit
E.
"Series J Offered Units" shall have the meaning set forth in
Exhibit E.
"Series L Exchange Notice" shall have the meaning set forth in
Exhibit
J.
"Series L Exchange Rights" shall have the meaning set forth in
Exhibit
J.
"Series L Offered Units" shall have the meaning set forth in
Exhibit J.
"Series S Exchange Notice" shall have the meaning set forth in
Exhibit
H.
"Series S Exchange Rights" shall have the meaning set forth in
Exhibit
H.
"Series S Offered Units" shall have the meaning set forth in
Exhibit H.
"S-SCUs" shall have the meaning set forth in Exhibit H.
"S-SCU Basic Distribution Amount" shall mean, with respect to an
S-SCU,
$1.464375 (but shall mean $.7321875 after
the 6/15/05 Stock Split); provided,
however, that such amount will be adjusted
appropriately to account for any
further unit splits, combinations or other
similar events with respect to the
S-SCUs.
"Stock Incentive Plan" shall mean the Company's 1993 Stock
Incentive
Plan as adopted on October 27, 1993 and
amended by Amendment No. 1 dated May 1,
1996 and Amendment No. 2 on May 3, 2000 and
Amendment No. 3 on May 7, 2000, then
amended and restated and
23
<PAGE>
renamed the "Amended and Restated CBL &
Associates
Properties, Inc. Stock Incentive Plan" on
May 5, 2003 as amended by Amendment #1
on October 29, 1993 and by Amendment #2 on
November 4, 2004 and as may be
further amended.
"Substituted Limited Partner" shall mean any Person admitted to
the
Partnership as a limited partner pursuant
to the terms of Section 9.2.
"Tax Items" shall have the meaning set forth in Exhibit C.
"Trading Day" shall mean a day on which the principal national
securities exchange on which the Common
Stock is listed or admitted to trading
is open for the transaction of business or,
if the Common Stock is not listed or
admitted to trading on any national
securities exchange, shall mean any day
other than a Saturday, a Sunday or a day on
which banking institutions in the
State of New York are authorized or
obligated by law or executive order to
close.
"Transfer" as a noun, shall mean any sale, assignment,
conveyance,
pledge hypothecation, gift, encumbrance or
other transfer, including, without
limitation, a transfer by operation of law
or through the laws of inheritance
and succession, and as a verb, shall mean
to sell, assign, convey, pledge,
hypothecate, give, encumber or otherwise
transfer, including, without
limitation, by operation of law or through
the laws of inheritance and
succession.
1.2. Exhibits, Etc. References to "Exhibit" or to a "Schedule"
are,
unless otherwise specified, to one of the
Exhibits or Schedules attached to this
Agreement, and references to an "Article"
or a "Section" are, unless otherwise
specified, to one of the Articles or
Sections of this Agreement. Each Exhibit
and Schedule attached hereto and referred
to herein is hereby incorporated
herein by reference.
1.3 Limited Partner Acceptance. Pursuant to Section 4.5 and 7.8 of
the
Agreement, upon execution of a Limited
Partner Acceptance of the Partnership
Agreement in the form attached hereto as
Attachment 1-A (the forms attached as
Attachment 1-A, 1-B and 1-C being
24
<PAGE>
individually referred to as a "Limited
Partner
Acceptance") or by causing a Limited
Partner Acceptance to be executed on its
behalf, each initial holder of SCUs
automatically will be admitted as an
Additional Partner of the Partnership,
without any further action or approval
and the General Partner hereby agrees to
cause the names of such recipients to
be recorded on the books and records of the
Partnership on the date of such
admission. In addition, upon the transfer
by an initial recipient of SCUs to its
designated holding entity as contemplated
by the Master Contribution Agreement,
and upon execution of a Limited Partner
Acceptance by or on behalf of such
designated holding entity, such designated
holding entity automatically will be
admitted as a Substituted Limited Partner
of the Partnership with respect to the
transferred SCUs (and all of the conditions
set forth in Section 9.2 of the
Agreement for such admission will be deemed
satisfied), without any further
action or approval, and General Partner
hereby agrees to cause the name of such
designated holding entity to be recorded on
the books and records of the
Partnership on the dated of such
admission.
Pursuant to Sections 4.5 and 7.8 of the Agreement, upon execution
of a
Limited Partner Acceptance of the
Partnership Agreement in the form attached
hereto as Attachment 1-B or by causing a
Limited Partner Acceptance to be
executed on its behalf, each initial holder
of S-SCUs automatically will be
admitted as an Additional Partner of the
Partnership, without any further action
or approval and the General Partner hereby
agrees to cause the names of such
recipients to be recorded on the books and
records of the Partnership on the
date of such admission.
Pursuant to the Sections 4.5 and 7.8 of the Agreement, upon
execution
of a Limited Partner Acceptance of the
Partnership Agreement in the form
attached hereto as Attachment 1-C or by
causing a Limited Partner Acceptance to
be executed on its behalf, the initial
holder of L-SCUs automatically will be
admitted as an Additional Partner of the
Partnership, without any further action
or approval and the General Partner herby
agrees to cause the name of such
recipient to be recorded on the book and
records of the Partnership on the date
of such admission.
25
<PAGE>
ARTICLE II.
Organization
2.1. Continuation. The parties hereto do hereby continue the
Partnership as a limited partnership
pursuant to the provisions of the Act, for
the purposes and upon the terms and
conditions hereinafter set forth. The
Partners agree that the rights and
liabilities of the Partners shall he as
provided in the Act except as otherwise
herein expressly provided. Promptly upon
the execution and delivery hereof, the
General Partner shall, to the extent
required under the Act or otherwise deemed
Necessary or appropriate by the
General Partner, cause an amendment to the
Certificate of Limited Partnership to
be filed with the Delaware Secretary of
State, and such other notice,
instrument, document, or certificate as may
be required by applicable law, and
which may be necessary or desirable to
enable the Partnership to conduct its
business, and to own its properties, under
the Partnership's name, to be filed
or recorded in all appropriate public
offices.
2.2. Name. The business of the Partnership shall be conducted under
the
name of CBL & Associates Limited
Partnership or such other name as the General
Partner may select, and all transactions of
the Partnership, to the extent
permitted by applicable law, shall be
carried on and completed in such name.
2.3. Character of the Business. The purpose of the Partnership
shall
be: to acquire, hold, own, develop,
redevelop, construct, improve, maintain,
operate, manage, sell, lease, rent,
transfer, encumber, mortgage, convey,
exchange, and otherwise dispose of, deal
with, foreclose upon, or otherwise
exercise all rights with respect to, any of
the Properties and any other real,
personal and intangible property of all
kinds; exercise all of the powers of a
partner in Property Partnerships; to
undertake such other activities as may be
necessary, advisable, desirable or
convenient to the business of the
Partnership; to engage in such other
ancillary activities as shall be necessary,
desirable or appropriate to effectuate the
foregoing purposes; and to otherwise
engage in any enterprise, business or
activity in which a limited partnership
may engage or conduct under the Act. The
Partnership shall have all powers
necessary or desirable to
26
<PAGE>
accomplish the purposes enumerated. In
connection with
the foregoing, but subject to all of the
terms, covenants, conditions and
limitations contained in this Agreement and
any other agreement entered into by
the Partnership, the Partnership shall have
full power and authority, directly
or through its interest in Property
Partnerships, to enter into, perform, and
carry out contracts of any kind, to borrow
money and to issue evidences of
indebtedness, whether or not secured by
mortgage, trust deed, pledge or other
lien or assignment, and, directly or
indirectly, to develop, acquire and
construct additional Properties necessary
or useful in connection with its
business.
2.4. Location of the Principal Place of Business. The location of
the
principal place of business of the
Partnership shall be at the Office Building,
or 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 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 1209 Orange Street,
Wilmington, Delaware 19801 or such
other location as the General Partner may
select in its sole and absolute
discretion.
ARTICLE III.
Term
3.1. Commencement. The Partnership's term commenced upon the filing
of
the Certificate of Limited Partnership with
the Secretary of State of the State
of Delaware on July 16, 1993.
3.2. Dissolution. The Partnership shall continue until dissolved
upon
the occurrence of the earliest of the
following events:
27
<PAGE>
(a) The withdrawal (is defined in the Act), dissolution,
termination, retirement or Bankruptcy of the General Partner or
the
Bankruptcy of the Company; the Partnership's business may, however,
be
continued and the Partnership reconstituted as provided in Section
9.1
hereof;
(b) The election to dissolve the Partnership made in writing
by the General Partner with, subject to Section 7.3, the Consent of
the
Limited Partners;
(c) The
sale or other disposition of all or substantially all
the assets of the Partnership unless the General Partner elects
to
continue the Partnership business for the purpose of the receipt
and
the collection of indebtedness or the collection of any other
consideration to be received in exchange for the assets of the
Partnership (which activities shall be deemed to be part of the
winding-up of the affairs of the Partnership);
(d) Dissolution required by operation of law; or
(e) December 31, 2090.
ARTICLE IV.
Contributions to Capital
4.1.
Partners. Exhibit A hereto sets forth the names of Partners of
the
Partnership as of the date hereof and the
Partnership Units held by each such
Partner. A Partner may be both a General
Partner and a Limited Partner
hereunder. The Partnership shall establish
and maintain a separate Capital
Account for each Partner.
4.2.General
Partner Capital Contribution.
(a) Prior to the date hereof, the General Partner has made
certain
Capital Contributions to the Partnership as
described in the books and records
of the Partnership as of the date
hereof.
(b) The gross fair market value of any property contributed by
the
General Partner to the Partnership
("Contributed Property"), other than money,
shall, except as otherwise expressly
provided herein, be the Acquisition Cost of
such Contributed Property. For purposes
hereof, the "Acquisition Cost" of
Contributed Property shall be, (i) in the
case of Contributed Property acquired
by the General Partner or the Company in
exchange for shares of Common Stock,
the
28
<PAGE>
Current Per Share Market Price as of the
closing date on which the General
Partner or the Company, as applicable,
acquired such Contributed Property
multiplied by the number of shares of
Common Stock issued in the acquisition or
(ii) in the case of Contributed Property
acquired by the General Partner or the
Company for consideration other than Common
Stock, the amount of such
consideration plus, in either case, any
costs and expenses incurred by the
General Partner or the Company, as
applicable, (and unreimbursed by the
Partnership) in connection with such
acquisition or contribution; provided,
however, that (A) in the event the General
Partner or the Company acquires the
Contributed Property in exchange for shares
of Common Stock or with proceeds
from a public offering of the Company's
securities, the Partnership shall assume
and pay (or reflect on its books as
additional consideration for such
Contributed Properties) the expenses,
including any applicable underwriting
discounts, incurred by the Company in
connection with the issuance of such
shares or securities, and (B) in the event
the Acquisition Cost of Contributed
Property is financed by any borrowings by
the General Partner or the Company, or
is otherwise encumbered by Liens relating
to obligations of the General Partner
or the Company, the Partnership shall, in
either case, assume any such
obligations of the General Partner or the
Company concurrently with the
contribution of such property to the
Partnership or, if impossible, shall
obligate itself to the General Partner or
the Company, as applicable, in an
amount and on terms equal to such
indebtedness or obligation, and the
Acquisition Cost shall be reduced by the
amount of such obligations assumed or
obligations incurred by the
Partnership.
4.3. Limited Partner Capital Contributions.
(a) Prior to the date hereof, each Limited Partner has made
certain
Capital Contributions to the Partnership as
described in the books and records
of the Partnership as of the date
hereof.
(b) A
Limited Partner shall be unconditionally liable to the
Partnership for all or a
29
<PAGE>
portion of any deficit in its Capital
Account if it so
elects to be liable for such deficit or
portion thereof. Such election may be
for either a limited or an unlimited amount
and may be amended or withdrawn at
any time. The election, and any amendment
thereof, shall be made by written
notice to the General Partner stating that
the Limited Partner elects to be
liable, and specifying the limitations, if
any, on the maximum amount or
duration of such liability. Said election,
or amendment thereof, shall be
effective only from the date the written
notice is received by the General
Partner, and shall terminate upon the date,
if any, specified therein as a
termination date or upon delivery to the
General Partner of a subsequent written
notice withdrawing or otherwise amending
such election. A withdrawal, or an
amendment reducing the Limited Partner's
maximum liability, shall not be
effective to avoid responsibility for any
loss incurred prior to such amendment
or withdrawal.
(c) The Limited Partners acknowledge that the Partnership Units
have
not been registered under any federal or
state securities laws and, as a result
thereof, they may not be sold or otherwise
transferred, except in compliance
with such laws and in accordance with the
provisions of this Agreement.
Notwithstanding anything to the contrary
contained in this Agreement, no
Partnership Units may be sold or otherwise
transferred unless such transfer is
exempt from registration under any
applicable securities laws or such transfer
is registered under such laws, it being
acknowledged that the Partnership has no
obligation to take any action which would
cause any such Units to be registered.
4.4.
Issuance of Additional Units. (a) Without the consent of any
Limited
Partner, but subject to the terms of
Section 9.3 below, the General Partner may
from time to time cause the Partnership to
issue to the Partners (including the
General Partner) or other Persons
additional Partnership Units ("Additional
Units") 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
30
<PAGE>
special rights, powers and duties,
including, without limitation, rights,
powers and duties senior to the Common
Units, and admit any such other Person as
an additional Limited Partner ("Additional
Partner") (in accordance with Section
4.5 hereof), in exchange for the Capital
Contribution by such Partner or Person
of cash and/or property. Without limiting
the provisions of this Article IV, the
General Partner is expressly authorized to
cause the Partnership to issue
Additional Units for less than either, (i)
the fair market value thereof, or
(ii) the applicable Current Per Share
Market Price multiplied by the number of
shares of Common Stock issuable with
respect to such Additional Units upon the
exercise of the Rights with respect
thereto. The General Partner shall have the
right and shall possess the authority to
amend this Agreement without the
consent of any Limited Partner to evidence
any action taken pursuant to this
Section 4.4 (a).
(b) In the event a Partner (the "Contributing Partner") contributes
to
the Partnership any funds obtained directly
or indirectly from the issuance by
the Company of Preferred Stock (the
"Preferred Contributed Funds"), then the
Contributing Partner shall be issued
Preferred Units of a designated class or
series to reflect its contribution of such
funds. Each class or series of
Preferred Units so issued shall be
designated by the General Partner to identify
such class or series with the class or
series of Preferred Stock which
constitutes the Related Issue. Each class
or series of Preferred Units shall be
described in a written document (the
"Preferred Unit Designation") attached as
Exhibit B that shall set forth in
sufficient detail, the economic rights,
including dividend, redemption and
conversion rights and sinking fund
provisions, of the class or series of
Preferred Units and the Related Issue. The
number of Preferred Units of a class or
series shall be equal to the number of
shares of the Related Issue sold. The
Preferred Unit Designation shall provide
for such terms for the class or series of
Preferred Units that shall entitle the
holders thereof to substantially the same
economic rights as the holders of the
Related
31
<PAGE>
Issue. Specifically, the holders of such
Preferred Units shall receive
distributions on the class or series of
Preferred Units pursuant to Section 6.2
equal to the aggregate dividends payable on
the Related Issue at the times such
dividend are paid (the "Preferred
Distribution Requirement"). The Partnership
shall redeem the class or series of
Preferred Units for a redemption price per
Preferred Unit equal to the redemption
price per share of the Related Issue,
exclusive of any accrued unpaid dividends
(the "Preferred Redemption Price")
upon the redemption of any shares of the
Related Issue. Each class or series of
Preferred Units shall also be converted
into additional Common Units at the time
and on such economic terms and conditions
as the Related Issue is converted into
Common Stock. Upon the issuance of any
class or series of Preferred Units
pursuant to this Section 4.4(b), the
General Partner shall provide the Limited
Partners with a copy of the Preferred Unit
Designation relating to such class or
series. A Partner shall have the right, in
lieu of contributing to the
Partnership funds received directly or
indirectly from the issuance of Preferred
Stock as Preferred Contributed Funds, to
lend such funds to the Partnership. Any
such loan shall be on the same terms and
conditions as the Related Issue except
that dividends payable on the Related Issue
shall be payable by the Partnership
to such Partner as interest, any mandatory
redemptions shall take the form of
principal payments and no Preferred Units
shall be issued to such Partner. If
any such loan is made, the Partnership
shall promptly reimburse such Partner for
all expenses including any applicable
underwriter discounts incurred by the
Company in connection with raising the
funds. Any such loan made by such Partner
to the Partnership may, at any time be
contributed to the Partnership as
Preferred Contributed Funds in exchange for
Preferred Units as above provided;
and if the Related Issue is by its terms
convertible into Common Stock, such
loan shall be so contributed to the
Partnership prior to the effectuation of
such conversion.
32
<PAGE>
(c) In the event a Partner contributes to the Partnership any
funds
obtained directly or indirectly from the
issuance by the Company of Capital
Stock, the Partnership shall reimburse,
such Partner for the expenses (including
any applicable underwriter discounts)
incurred by the Company in connection with
raising such funds.
4.5. Admission of Additional Partners.
(a) After the date hereof, a Person who makes a Capital
Contribution to the Partnership in
accordance with this Agreement shall be
admitted to the Partnership as an
Additional Partner only upon furnishing to the
General Partner (i) a written agreement in
form satisfactory to the General
Partner accepting all of the terms and
conditions of this Agreement and (ii)
such other documents or instruments as may
be required in the discretion of the
General Partner.
(b) No Person shall be admitted as an Additional Partner without
the
consent of the' General Partner, which
consent may be given or withheld in the
General Partner's sole and absolute
discretion and for any or no reason
whatsoever. The admission of any Person as
an Additional Partner shall become
effective on the date upon which the name
of such Person is recorded on the
books and records of the Partnership,
following the consent of the General
Partner to such admission.
(c) If an Additional Partner is admitted to the Partnership on
any
other date than the first day of the
Partnership's tax year, then Net Income,
Net Loss, each item thereof and all other
items allocable among Partners and
Assignees for such tax year shall be
allocated among such Additional Partner and
all other Partners and Assignees by taking
into account their varying interests
during the Fiscal Year in accordance with
Section 706(d) of the Code, using the
interim closing of the books method. Solely
for purposes of making such
allocations, each of such items
33
<PAGE>
for the calendar month in which an
admission of
any Additional Partner occurs shall be
allocated among all Partners Assignees
including such Additional Partner.
(d) The General Partner, acting alone, shall be authorized on
behalf of
each of the Partners to amend this
Agreement to reflect the admission of any
Additional Partner or to record any change
in ownership of Partnership Units of
any Partner.
4.6. Stock Incentive Plan. If at any time or from time to time
Incentive Options granted in connection
with the Company's Stock Incentive Plan
are exercised in accordance with the terms
of the Incentive Option Agreement:
(a) the Company shall, as soon as practicable after such
exercise, contribute or cause to be contributed to the capital of
the
Partnership an amount equal to the exercise price paid to the
Company
by such exercising party in connection with the exercise of the
Incentive Option; and
(b) the Partner which makes a contribution to the capital of
the Partnership pursuant to Section 4.2(a) hereof shall be deemed
to
have contributed to the Partnership as Capital Contributions an
amount
equal to the Current Per Share Market Price (as of the Trading
Date
immediately preceding the date on which the purchase of the
Common
Stock by such exercising party is consummated) multiplied by the
number
of shares of Common Stock delivered by the Company to such
exercising
party and the Partnership shall issue to such contributing Partner
a
number of Common Units equal to such number of shares of Common
Stock
divided by the Conversion Factor.
4.7. No Third Party Beneficiary. No
creditor or other third party having
dealings with the Partnership shall have
the right to enforce the right
or obligation of any Partner to make
Capital Contributions or loans or to
pursue any other right or remedy hereunder
or at law or in equity, it being
understood and agreed that the provisions
of this Agreement shall be
solely for the benefit 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 or
loans to the Partnership shall be deemed an
asset of the Partnership for any
purpose by any creditor or other third
party, nor may such rights or obligations
be sold, transferred or assigned by the
Partnership or pledged or encumbered by
the Partnership to secure any debt or other
obligation of the Partnership or of
any of the Partners.
34
<PAGE>
4.8. 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 demand or receive
the return of its Capital Contribution from
the Partnership or from any of the
other Partners.
4.9. Adjustment Upon Conversion of Preferred Stock. Upon the
conversion
of any shares of Preferred Stock to Common
Stock pursuant to the terms of such
Preferred Stock, the ownership of
Partnership Units of the Partners shall be
adjusted in accordance with the provisions
of this Agreement to reflect, on the
date of such conversion, the parallel
conversion of the Preferred Units that
were a Related Issue of such converted
Preferred Stock into Common Units equal
in number to the number of shares of Common
Stock issued as a result of such
conversion.
ARTICLE V.
Representations, Warranties and Covenants
5.1. Representations and Warranties. Each Limited Partner
hereby
represents and warrants to the Partnership
and the General Partner the
following:
(a) Organization; Authority. Such Limited Partner is either
(A) in the case of such persons which are corporations, duly
incorporated, validly existing and in good standing under the laws
of
its jurisdiction of incorporation, or (B) in the case of such
persons
which are partnerships or trusts, a partnership or trust, as the
case
may be, duly formed, validly existing and in good standing (to
the
extent applicable) under the laws of its jurisdiction of formation.
The
Limited Partner has the requisite authority to enter into and
perform
this Agreement.
(b) Due Authorization; Binding Agreement. The execution,
delivery and performance of this Agreement by such Limited Partner
has
been duly and validly authorized by all necessary action of
such
Limited Partner. This Agreement has been duly executed and
delivered by
such Limited Partner, or an authorized representative of such
Limited
Partner, and constitutes a legal valid and binding obligation of
such
Limited Partner, enforceable against such Limited Partner in
accordance
with the terms hereof.
(c) Consents and Approvals. No consent, waiver, approval or
authorization of, or filing, registration or qualification with,
or
notice to, any governmental unit or any other person is required to
be
made, obtained or given by such Limited Partner in connection
35
<PAGE>
with the execution, delivery and performance of this Agreement
except
for those which have been heretofore obtained.
(d) No Violation. None of the execution, delivery or
performance of this Agreement by such Limited Partner does or
will,
with or without the giving of notice, lapse of time or both,
(i)
violate, conflict with or constitute a default under any term
or
provision of (A) the organizational documents of such Limited
Partner
or any agreement to which such Limited Partner is a party or by
which
it is bound or (B) any term or provision of any judgment,
decree,
order, statute, injunction, rule or regulation of a governmental
unit
applicable to such Limited Partner or any agreement to which
such
Limited Partner is a party or by which it or its assets or
properties
are bound, or (ii) result in the creation of any Lien or other
encumbrance upon the assets or properties of such Limited Partner
other
than in favor of such Partnership.
5.2. Covenants. Without the prior consent of the General Partner,
no
Limited Partner shall take any action,
including acquiring, directly or
indirectly, an interest in any tenant of a
Property, which would have the effect
of causing the percentage of the gross
income of the Company that fails to be
treated as "rents from real property"
within the meaning of Section 856(d) (2)
of the Code to exceed such percentage as of
the date of the First Restated
Agreement.
ARTICLE VI.
Allocations, Distributions, and
Other Tax and Accounting Matters
6.1. Allocations. The Net Income or Net Loss and/or other
Partnership
items shall be allocated pursuant to the
provisions of Exhibit C hereto. All Net
Income or Net Loss with respect to periods
prior to the date of the Second
Amended and Restated Agreement dated June
30, 1998, shall be allocated to the
Limited Partners pursuant to the First
Restated Agreement.
6.2.
Distributions.
(a) The General Partner shall cause the Partnership to
distribute all or a portion of Net Cash
Flow to the Partners from time to time
as determined by the General Partner, but
in any event not less frequently than
quarterly, in such amounts as the General
Partner shall determine. All such
distributions shall be made in accordance
with the following order of priority:
36
<PAGE>
(i) First, to the extent that the amount of Net Cash
Flow
distributed no :he relevant Partner, on account of the
Preferred
Units, for any prior quarter was less than the Preferred
Distribution
Requirement for such quarter, and has not been subsequently
distributed
pursuant to this Section 6.2(a) (i) (a "Preferred Distribution
Shortfall"), Net Cash Flow shall be distributed to the relevant
Partner, on account of the Preferred Units, in an amount necessary
to
satisfy such Preferred Distribution Shortfall for the current and
all
prior Partnership taxable years. In the event that the Net Cash
Flow
distributed for a particular quarter is less than the Preferred
Distribution Shortfall, then all Net Cash Flow for the current
quarter
shall be distributed to the relevant Partner on account of the
Preferred Units;
(ii) Second, Net Cash Flow shall be distributed to the
relevant Partner, on account of the Preferred Units, in an amount
equal
to the Preferred Distribution Requirement for the then current
quarter
for each outstanding Preferred Unit. In the event that the amount
of
Net Cash Flow distributed for a particular quarter pursuant to
this
subparagraph (a) (ii) is less than the Preferred Distribution
Requirement for such quarter, then all such Net Cash Flow for
such
quarter shall be distributed to the relevant Partner, on account of
the
Preferred Units. In addition, in the event that the Partnership
is
liquidated pursuant to Article VIII, the allocation described
above
shall be made to the relevant Partner, on account of the
Preferred
Units, with respect to all Preferred Units then outstanding;
and
(iii) Third, to the extent that the amount of Net Cash
Flow distributed to the holders of SCUs for any prior quarter was
(for
any reason, including as a result of Section 6.2(e), a lack of
legally
available funds or a decision by the General Partner not to
make
distributions for such quarter) less than the amount required to
be
distributed for such quarter on account of the SCUs pursuant to
subparagraph (a)(iv) below, and such shortfall has not been
subsequently distributed pursuant to this Section 6.2(a)(iii), Net
Cash
Flow shall be distributed to the holders of SCUs ratably until
they
have received an amount per SCU necessary to satisfy such shortfall
for
all prior quarters of the current and all prior Partnership
taxable
years.
(iv) Fourth, Net Cash Flow shall be distributed to the holders
of SCUs ratably until they have received for the quarter to
which
distribution relates an amount for each outstanding SCU equal to
the
Basic Distribution Amount, provided, however, that in the event
that
the Common Unit Distribution Amount with respect to each of the
four
consecutive calendar quarters immediately preceding the
calendar
quarter to which the distribution under this subparagraph
(a)(iv)
relates equal to or greater than the Floor Distribution, then
the
amount required to be distributed under this subparagraph (a)(iv)
for
each outstanding SCU shall be equal to the product of the
Reduction
Factor and the Basic Distribution Amount; and
(v) Fifth, the balance of the Net Cash Flow to be distributed,
if any, shall be distributed to holders of SCUs and Common Units,
pro
rata in accordance with their proportionate ownership of the
aggregate
number SCUs and Common Units outstanding counting each SCU as
the
number of Common Units into which it is convertible pursuant
37
<PAGE>
to the terms of (Exhibit E) provided, however, that such
distribution
to the holders of SCUs shall be reduced by the amount of the
distribution made to them on account of their SCUs with respect
to
such quarter pursuant to subparagraph (a)(iv) above and the
reduction
will be allocated among the holders of SCUs pro rata in
accordance
with their respective percentage interests in the total number
of
SCUs then outstanding.
For the avoidance of doubt, set forth below are
illustrations of the distributions payable to the holders of SCUs
and
Common Units pursuant to subparagraphs (a)(iv) and (a)(v) above:
(I) if
the Common Unit Distribution amount is $0.8750 ($0.43750 after
the
6/15/05 Stock Split), then the amount payable with respect to
each
outstanding SCU for that quarter is $0.8750 ($0.43750 after the
6/15/05
Stock Split); (II) of the Common Unit Distribution amount is
$0.725625
($0.3628125 after the 6/15/05 Stock Split), then the amount
payable
with respect to each outstanding SCU for that quarter is
$0.725625
($0.3628125 after the 6/15/05 Stock Split); (III) if the Common
Unit
Distribution Amount is $0.5875 ($0.29375 after the 6/15/05
Stock
Split), then the amount payable with respect to each outstanding
SCU
for that quarter is $0.725625 ($0.3628125 after the 6/15/05
Stock
Split); (IV) if the Common Unit Distribution amount is $0.4375
($0.21875 after the 6/15/05 Stock Split), then the amount payable
with
respect to each outstanding SCU for that quarter is $0.725625
($0.3628125 after the 6/15/05 Stock Split); (V) if the Common
Unit
Distribution amount is $0.21875 ($0.109375 after the 6/15/05
Stock
Split), then the amount payable with respect to each outstanding
SCU
for that quarter is $0.725625 ($0.3628125 after the 6/15/05
Stock
Split) (unless the Common Unit Distribution amount with respect to
each
of the four consecutive quarters immediately preceding such quarter
was
less than the Floor Distribution, in which case the amount payable
with
respect to each outstanding SCU for that quarter would be
$0.3628125
($0.18140625 after the 6/15/05 Stock Split); and (VI) if the
Common
Unit Distribution amount is $0.00, then the amount payable with
respect
to each outstanding SCU for that quarter is $0.725625 ($0.3628125
after
the 6/15/05 Stock Split) (unless the Common Unit Distribution
Amount
with respect to each of the four consecutive quarters
immediately
preceding such quarter was less than the Floor Distribution, in
which
case the amount payable with respect to each outstanding SCU for
that
quarter would be $0.00).
(b) Distributions shall also be made in accordance with the
following
order of priority:
(i) Concurrently, ratably and on parity with the distributions
to holders of SCUs provided for under Section 6.2(a)(iii), to
the
extent that the amount of Net Cash Flow distributed to the holders
of
S-SCUs for any prior quarter was (for any reason, including as a
result
of section 6.2(e), a lack of legally available funds or a decision
by
the General Partner not to make distributions for such quarter)
less
than the amount
required to be distributed for such quarter on account
of the S-SCUs pursuant to subparagraph (ii) below, and such
shortfall
has not been subsequently distributed pursuant to this Section
6.2(b)(i), Net Cash Flow shall be distributed to the holders of
S-SCUs
until they have received an amount per S-SCU, as applicable,
necessary
to satisfy such shortfall for all prior quarters of the current and
all
prior Partnership taxable years;
38
<PAGE>
(ii) Concurrently, ratably and on parity with the
distributions to holders of SCUs provided for under Section
6.2(a)(iv),
Net Cash Flow shall be distributed among the holders of S-SCUs
until
they have received for the quarter to which the distribution
relates an
amount for each outstanding S-SCU equal to the applicable S-SCU
Basic
Distribution Amount;
(iii) Concurrently, ratably and on parity with the
distributions to holders of SCUs and Common Units provided for
under
Section 6.2(a)(v), the balance of the Net Cash Flow to be
distributed,
if any, shall be distributed to holders of S-SCUs pro rata in
accordance
with their proportionate ownership of the aggregate number
of SCUs, S-SCUs and Common Units outstanding (counting each SCU
or
S-SCU as the number of Common Units into which it is
convertible
pursuant to the terms of Exhibit E or Exhibit H, as
applicable),
provided, however, that such distribution to the holders of
S-SCUs
shall:
(A) be made only after the quarterly distributions on
account of each Common Unit under Section 6.2(a)(v)
for the four previous consecutive quarters shall have
averaged an amount that is equal to or greater than
the applicable S-SCU Basic Distribution Amount; and
(B) be reduced by the amount of the distribution made
to such Holders on account of their S-SCUs with
respect to such quarter pursuant to subparagraph
(b)(ii) above and the reduction will be allocated
among the holders of S-SCUs pro rata in accordance
with their respective percentage interests in the
total
number of S-SCUs then outstanding.
(iv) Notwithstanding the foregoing, all distributions pursuant
to this Section 6.2(b) shall remain subject to the provisions of
(i)
each Certificate of Designation for any class or series of
Preferred
Units, (ii) Exhibit E hereto with respect to the SCUs, and
(iii)
Exhibit H hereto with respect to the S-SCUs.
(c) Distributions shall also be made in accordance with the
following order of priority:
(i) Concurrently, ratably and on parity and with the
distributions to holders of SCUs and S-SCUs
provided for under Sections 6.2(a)(iii) and 6.2(b)(i),
respectively, to
the extent that the amount of Net Cash Flow distributed to the
holders
of L-SCUs for any prior quarter was (for any reason, including as
a
result of Section 6.2(e), a lack of legally available funds or
a
decision by the General Partner not to make distributions for
such
quarter) less than the amount required to be distributed for
such
quarter on account of the L-SCUs pursuant to subparagraph (ii)
below,
and such shortfall has not been subsequently distributed pursuant
to
this Section 6.2(c)(i), Net Cash Flow shall be distributed to
the
holders of L-SCUs until they have received an amount per L-SCU,
as
applicable, necessary to satisfy such shortfall for all prior
quarters
of the current and all prior Partnership taxable years;
39
<PAGE>
(ii) Concurrently, ratably and on parity with the
distributions to holders of SCUs and S-SCUs provided for under
Sections
6.2(a)(iv) and 6.2(b)(ii), respectively, Net Cash Flow shall be
distributed among the holders of L-SCUs until they have received
for
the quarter to which the distribution relates an amount for
each
outstanding L-SCU equal to the applicable L-SCU Basic
Distribution
Amount;
(iii) Concurrently, ratably and on parity with the
distributions to holders of SCUs, S-SCUs and Common Units provided
for
under Section 6.2(a)(v) and 6.2(b)(iii), the balance of the Net
Cash
Flow to be distributed, if any, shall be distributed to holders
of
L-SCUs pro rata in accordance with their proportionate ownership of
the
aggregate number of SCUs, S-SCUs and L-SCUs and Common Units
outstanding (counting each SCU, S-SCU or L-SCU as the number of
Common
Units or number of shares of Common Stock, as applicable, into
which it
is convertible pursuant to the terms of Exhibit E, Exhibit H or
Exhibit
J, as applicable), provided, however, that such distribution to
the
holders of L-SCUs shall be reduced by the amount of the
distribution
made to such Holders on account of their L-SCUs with respect to
such
quarter pursuant to subparagraph (c)(ii) above and the reduction
will
be allocated among the holders of L-SCUs pro rata in accordance
with
their respective percentage interests in the total number of
L-SCUs
then outstanding.
(iv) Notwithstanding the foregoing, all distributions pursuant
to this Section 6.2(c) shall remain subject to the provisions of
(i)
each Certificate of Designation for any class or series
Preferred
Units, (ii) Exhibit E hereto with respect to the SCUs, (iii)
Exhibit H
hereto with respect to the S-SCUs and (iv) Exhibit J hereto
with
respect to the L-SCUs.
(d) (1) Neither the Partnership nor the Limited Partners shall have
any
obligation to see that any funds
distributed pursuant to subparagraph (a) (i) of
this Section 6.2 are in turn used to pay
dividends on any Capital Stock of the
Company. Subject to the preceding
sentences, (a) the General Partner shall use
its reasonable efforts to cause the
Partnership to distribute sufficient amounts
to enable the Company to pay shareholder
dividends that will (i) satisfy the
requirements for qualifying as a REIT under
the Code and Regulations ("REIT
Requirements"), and (ii) avoid any federal
income or excise tax liability of the
Company; and (b) in the event of a sale of
a Property or an interest in a
Property Partnership (other than a direct
or indirect interest in a Property set
forth in Exhibit A of the Master
Contribution Agreement (a "Jacobs Property")
and other than a Property constituting
"substituted basis property" (as defined
in Section 7701(a)(42) of the Code) with
respect to a Jacobs Property) giving
rise to a special allocation of
40
<PAGE>
taxable income or gain to a limited Partner
or
Partners pursuant to Section 3(c) of
Exhibit C, the General Partner shall cause
the Partnership to distribute the Net Sale
Proceeds therefrom up to an amount
sufficient to enable such Limited Partner
or Partners to pay any income tax
liability with respect to the income or
gain so specially allocated (or, if any
such Limited Partner is a partnership or S
corporation, to enable such Limited
Partner to distribute sufficient amounts to
its equity owners to enable such
owners to pay any income tax liability with
respect to their share of such
taxable income or gain).
(d) (2) If in any quarter the Partnership redeems any
outstanding
Preferred Units, unless and except to the
extent that such redemption is
effected out of borrowed funds, Capital
Contributions or other sources Net Cash
Flow shall be distributed to the relevant
Partner, on account of the Preferred
Units, in an amount equal to the Preferred
Redemption Amount for the Preferred
Units being redeemed before being
distributed pursuant to Section 6.2(a). There
shall be no adjustment of the then current
proportionate ownership of
Partnership Units of the Partners on
account of any distribution under this
Section.
(e) Notwithstanding the foregoing, all distributions pursuant
to this Section 6.2 shall remain subject to
the provisions of (i) the
Certificate of Designation for each class
or series of Preferred Units set forth
in Exhibit B hereto and (ii) Exhibit E
hereto with respect to the SCUs.
(f) Notwithstanding the provisions of Section 6.2(a) above, if
the distributions with respect to the SCUs
made on or prior to the second
anniversary of the issuance of the SCUs
would result in any holder of a SCU
receiving an annual return on such holder's
"unreturned capital" (as defined for
purposes of Regulation Section 1.707-4(a))
for a partnership tax year (treating
the Partnership tax year in which such
second anniversary occurs as ending on
such
41
<PAGE>
date) in excess of the Safe Harbor Rate (as
defined below), then the
distributions to such holder in excess of
such Safe Harbor Rate will be
deferred, will continue to cumulate and
will be payable on the earlier to occur
of (i) the disposition of the SCUs to which
such deferred distributions relate
in a transaction in which the disposing
holder recognizes taxable gain thereon
or (ii) the first distribution payment date
with respect to the SCUs following
the second anniversary of the issuance of
the SCUs. For purposes of the
foregoing, the "Safe Harbor Rate" shall
equal 150% of the highest applicable
Federal rate, based on quarterly
compounding, in effect for purposes of Section
1274(d) of the Code at any time between the
date of the issuance of the SCUs and
the date on which the relevant distribution
payment is made.
(g) Distributions to Common Units and SCUs may be made by
offering the holders of Common Units and
SCUs the opportunity to make an
election to take a portion of such
distribution in cash or additional Common
Units; provided that such an offer may not
be made unless (i) holders of SCUs
and holders of Common Units received on a
conversion or redemption of SCUs will
receive the full amount of the distribution
in cash to the extent that such
holders elect to receive cash, including an
election to receive 100% of the
distribution in cash, (ii) with respect to
distributions made within two years
of the final Closing provided for in the
Master Contribution Agreement, such
distributions will not cause the aggregate
distributions to a holder of SCUs or
holder of Common Units received on a
conversion or redemption of SCUs, other
than distributions to such holder in
respect of the Basic Distribution Amount,
to exceed the product of (x) the lesser of
such holder's percentage interest in
Partnership profits for the year in which
the distribution is made or such
holder's percentage interest in Partnership
profits for the life of the
Partnership (as determined for purposes of
Regulations Section 1,707-4(b)) and
(y) the Partnership's net cash flow from
operations for the year in which the
42
<PAGE>
distribution is made (as determined for
purposes of Regulations Section
1.707-4(b)) and (iii) holders of SCUs that
elect to receive 100% of the
distribution in cash will have received in
respect of the quarter to which such
distribution relates an amount per SCU, in
cash, pursuant to Section 6.2(a)(iv),
equal to the Basic Distribution Amount. Any
such election will be made pro rata
between the Common Units and SCUs, i.e.,
the same amount of cash or Common Units
shall be offered with respect to each
Common Unit and SCU. Holders of Common
Units or SCUs shall in no event be required
to elect to receive additional
Common Units.
6.3. Books of Account. At all times during the continuance of
the
Partnership, the General Partner shall
maintain or cause to be maintained full,
true, complete and correct books of account
in accordance with generally
accepted accounting principles wherein
shall be entered particulars of all
monies, goods or effects belonging to or
owing to or by the Partnership, or
paid, received, sold or purchased in the
course of the Partnership's business,
and all of such other transactions, matters
and things relating to the business
of the Partnership as are usually entered
in books of account kept by persons
engaged in a business of a like kind and
character. In addition, the Partnership
shall keep all records as required to be
kept pursuant to the Act. The books and
records of account shall be kept at the
principal office of the Partnership, and
each Partner shall at all reasonable times
have access to such books and records
and the right to inspect the same.
6.4. Reports. The General Partner shall cause to be submitted to
the
Limited Partner Representatives promptly
upon receipt of the same from the
Accountants and in no event later than
April 1 of each year, copies of Audited
Financial Statements prepared on a
consolidated basis for the Partnership and
the Property Partnerships, together with
the reports thereon, and all
supplementary schedules and information,
prepared by the Accountants, provided,
however, that
43
<PAGE>
with respect to Joint Venture Partnerships
which are not
Controlled by the Partnership, the General
Partner shall diligently seek to (i)
cause the Joint Venture Partnership to
distribute its Audited Financial
Statements on or before April 1 of each
year subject to the Joint Venture
Partnership's partnership agreement, and
(ii) cause such Audited Financial
Statements to be submitted to the Limited
Partners promptly upon their receipt.
The Partnership shall also cause to be
prepared such reports and/or information
as are necessary for the General Partner to
determine its qualification as a
REIT and its compliance with REIT
Requirements.
6.5. Audits. Not less frequently than annually, the General
Partner
shall cause the Accountants to audit books
and records of the Partnership and
the Property Partnerships (and, pursuant to
the terms of the applicable
partnership agreement, diligently seek to
cause each Joint Venture Partnership
not Controlled by the Partnership to
annually audit such Joint Venture
Partnership's books and records).
6.6. Tax Elections and Returns. All elections required or permitted
to
be made by the Partnership under any
applicable tax law shall be made by the
General Partner in its sole discretion;
provided, however, the General Partner
shall, if requested by transferee, file an
election on behalf of the Partnership
pursuant to Section 754 of the Code to
adjust the basis of the Partnership
property in the case of the Transfer of a
Partnership Unit, including Transfers
made in connection with the exercise of
Rights (or Series J, Series S or Series
L Exchange Rights), made in accordance with
the provisions of this Agreement.
The General Partner shall cause the
Accountants to prepare and file all state
and federal tax returns on a timely
basis.
6.7. Tax Matters Partner. The General Partner is hereby designated
as
the Tax Matters Partner within the meaning
of Section 6231(a) (7) of the Code
for the Partnership; provided, however, (i)
in exercising its authority as Tax
Matters Partner it shall be limited by the
provisions of this Agreement
affecting tax aspects of the Partnership;
(ii) the General Partner shall consult
44
<PAGE>
in good faith with the Limited Partner
Representatives regarding the filing of a
Code Section 6227(b) administrative
adjustment request with respect to the
Partnership or a Property before filing
such request, it being understood,
however, that the provisions hereof shall
not be construed to limit the ability
of any Partner, including the General
Partner, to file an administrative
adjustment request on its own behalf
pursuant to Section 6227(a) of the Code;
(iii) the General Partner shall consult in
good faith with the Limited Partner
Representatives regarding the filing of a
petition for judicial review of an
administrative adjustment request under
Section 6228 of the Code, or a petition
for judicial review of a final partnership
administrative judgment under Section
6226 of the Code relating to the
Partnership before filing such petition; (iv)
the General Partner shall give prompt
notice to the Limited Partner
Representatives of the receipt of any
written notice that the Internal Revenue
Service or any state or local taxing
authority intends to examine Partnership
income tax returns for any year, receipt of
written notice of the beginning of
an administrative proceeding at the
Partnership level relating to the
Partnership under Section 6223 of the Code,
receipt of written notice of the
final Partnership administrative adjustment
relating to the Partnership pursuant
to Section 6223 of the Code and receipt of
any request from the Internal Revenue
Service for waiver of any applicable
statute of limitations with respect to the
filing of any tax return by the
Partnership; and (v) the general Partner shall
promptly notify the Limited Partner
Representatives if the General Partner does
not intend to file for judicial review with
respect to the Partnership. The
General Partner, in acting on behalf of the
Partnership as Tax Matters Partner
of a Property Partnership, shall afford the
Limited Partners the same rights
with respect to Property Partnership tax
matters as afforded to the Limited
Partners under this Section 6.7.
ARTICLE VII.
Rights, Duties and Restrictions of the General Partner
7.1. Expenditures by Partnership. The General Partner is hereby
authorized to pay compensation for
accounting administrative, legal, technical,
management and other services
45
<PAGE>
rendered to the Partnership. All of the
aforesaid
expenditures shall be made on behalf of the
Partnership and the General Partner
shall be entitled to reimbursement by the
Partnership for any expenditures
incurred by it on behalf of the Partnership
which shall be made other than out
of the funds of the Partnership. The
Partnership shall also assume, and pay when
due, all Administrative Expenses.
7.2. Powers and Duties of General Partner. The General Partner
shall be
responsible for the management of the
Partnership's business and affairs. Except
as otherwise herein expressly provided, the
General Partner shall have, and is
hereby granted, full and complete power
authority and discretion to take such
action for and on behalf of the Partnership
and in its name as the General
Partner shall, in its sole and absolute
discretion, deem necessary or
appropriate to carry out the purposes for
which the Partnership was organized.
Except as otherwise expressly provided
herein, and subject to Section 7.3
hereof, the General Partner shall have the
right, power and authority:
(a) To manage, control, invest, reinvest, acquire by purchase,
lease or otherwise sell, contract to purchase or sell, grant,
obtain,
or exercise options to purchase, options to sell or conversion
rights,
assign, transfer, convey, deliver, endorse, exchange, pledge,
mortgage,
abandon, improve, repair, maintain, insure, lease for any term
and
otherwise deal with any and all property of whatsoever kind and
nature,
and wherever situated, in furtherance of the business or purposes
of
the Partnership;
(b) To acquire, directly or indirectly, interests in real
estate of any kind and of any type, and any and all kinds of
interests
therein (including, without limitation, Entities investing
therein),
and to determine the manner in which title thereto is to be held;
to
manage (directly or through property managers, including
without
limitation, the Management Company), insure against loss, protect
and
subdivide any of the real estate, interests therein or parts
thereof;
to improve, develop or redevelop any such real estate; to
participate
in the ownership and development of any property; to dedicate
for
public use, to vacate any subdivisions or parts thereof, to
re-subdivide, to contract to sell, to grant options to purchase
or
lease, to sell on any terms; to convey, mortgage, pledge or
otherwise
encumber said property, or any part thereof; to lease said property
or
any part thereof from time to time, upon any terms and for any
period
of time, and to renew or extend leases, to amend, change or modify
the
terms and provisions of any leases and to
46
<PAGE>
grant options to lease and
options to renew leases and options to purchase; to partition or
to
exchange said real property, or any part thereof, for other real
or
personal property; to grant easements or charges of any kind;
to
release, convey or assign any right, title or interest in or about
or
easement appurtenant to said property or any part thereof; to
construct
and reconstruct, remodel, alter, repair, add to or take from
buildings
on any property in which the Partnership owns an interest; to
insure
any Person having an interest in or responsibility for the
care,
management or repair of such property; to direct the trustee of
any
land trust to mortgage, lease, convey or contract to convey the
real
estate held in such land trust or to execute and deliver deeds,
mortgages, notes, and any and all documents pertaining to the
property
subject to such land trust or in any matter regarding such trust;
to
execute assignments of all or any part of the beneficial interest
in
any land trust in which the Partnership owns a beneficial
interest;
(c) To employ, engage or contract with or dismiss from
employment or engagement Persons to the extent deemed necessary
or
appropriate by the General Partner for the operation and management
of
the Partnership
business, including but not limited to contractors,
subcontractors, engineers, architects surveyors, mechanics,
consultants, accountants, attorneys, insurance brokers, real
estate
brokers and others;
(d) To enter into, make, amend, perform and carry out or
cancel and rescind, contracts and other obligations on behalf of
the
Partnership and to cause all Administrative Expenses to be
paid;
(e) To borrow money, procure loans and advances from any
Person for Partnership purposes, and to apply for and secure, from
any
Person, credit or accommodations; to contract liabilities and
obligations, direct or contingent and of every kind and nature
(including interest rate swaps, caps, and hedges) with or
without
security; and to repay, discharge, settle, adjust, compromise,
or
liquidate any such loan, advance, credit, obligation or
liability;
(f) To pledge, hypothecate, mortgage, assign, deposit,
deliver, enter into sale and leaseback arrangements or otherwise
give
as security or as additional or substitute security or for sale
or
other disposition any and all Partnership property, tangible or
intangible, including, but not limited to, real estate and
beneficial
interests in land trusts, and to make substitutions thereof, and
to
receive any proceeds thereof upon the release or surrender thereof;
to
sign, execute and deliver any and all assignments, deeds and
other
contracts and instruments in writing; to authorize, give, make,
procure, accept and receive moneys, payments, property,
notices,
demands, vouchers, receipts, releases, compromises and adjustments;
to
waive notices, demands, protests and authorize and execute waivers
of
every kind and nature; to enter into, make, execute, deliver
and
receive written agreements, undertakings and instruments of every
kind
and nature; to give oral instructions and make oral agreements;
and
generally to do any and all other acts and things incidental to any
of
the foregoing or with reference to any dealings or transactions
which
the General Partner may deem necessary, proper or advisable to
effect
or accomplish any of the foregoing or to carry out the business
and
purposes of the Partnership;
47
<PAGE>
(g) To acquire and enter into any contract of insurance which
the General Partner deems necessary or appropriate for the
protection
of the Partnership, for the conservation of the Partnership's
assets or
for any purpose convenient or beneficial to the Partnership;
(h) To conduct any and all banking transactions on behalf of
the Partnership; to adjust and settle checking, savings, and
other
accounts with such institutions as the General Partner shall
deem
appropriate; to draw, sign, execute, accept, endorse,
guarantee,
deliver, receive and pay any checks, drafts, bills of exchange,
acceptances, notes, obligations, undertakings and other instruments
for
or relating to
the payment of money in, into or from any account in the
Partnerships name; to execute, procure, consent to and
authorize
extensions and renewals of any of the foregoing; to make deposits
into
and withdrawals from the Partnership's bank accounts; and to
negotiate
or discount commercial paper, acceptances, negotiable
instruments,
bills of exchange and dollar drafts;
(i) To demand, sue for, receive, and otherwise take steps to
collect or recover all debts, rents, proceeds, interests,
dividends,
goods, chattels, income from property, damages and all other
property,
to which the Partnership may be entitled or which are or may become
due
the Partnership from any Person; to commence, prosecute or enforce,
or
to defend, answer or oppose, contest and abandon all legal
proceedings
in which the Partnership is or may hereafter be interested; and
to
settle, compromise or submit to arbitration any accounts,
debts,
claims, disputes and matters which may arise between the
Partnership
and any other Person and to grant an extension of time for the
payment
or satisfaction thereof on any terms, with or without security;
(j) To make arrangements for financing, including the taking
of all action deemed necessary or appropriate by the General
Partner to
cause any approved loans to be closed;
(k) To take all reasonable measures necessary to insure
compliance by the Partnership with applicable arrangements, and
other
contractual obligations and arrangements entered into by the
Partnership from time to time in accordance with the provisions of
this
Agreement, including periodic reports as required to be submitted
to
lenders and using all due diligence to insure that the Partnership
is
in compliance with its contractual obligations;
(l) To maintain the Partnership's books and records;
(m) To prepare and deliver, or cause to be prepared and
delivered by the Partnership's Accountants, all financial and
other
reports with respect to the operations of the Partnership and
all
Federal and state tax returns and reports;
(n) To act in any state or nation in which the Partnership may
lawfully act, for itself or as principal, agent or representative
for
any person with respect to any business of the Partnership;
48
<PAGE>
(o) To become a partner or member in, and perform the
obligations of a partner or member of, any general or limited
partnership or limited liability company;
(p) To apply for, register, obtain, purchase or otherwise
acquire trademarks, trade names, labels and designs relating to
or
useful in connection with any business of the Partnership, and to
use,
exercise, develop and license the use of the same;
(q) To pay or reimburse any and all actual fees, costs and
expenses incurred in the formation and organization of the
Partnership;
(r) To do all acts which are necessary, customary or
appropriate for the protection and preservation of the
Partnership's
assets, including the establishment of reserves; and
(s) In general, to exercise all of the general rights,
privileges and powers permitted to be had and exercised by the
provisions of the Act.
Except as otherwise provided herein, to the
extent the duties of the General
Partner require expenditures of funds to be
paid to third parties, the General
Partner shall not have any obligations
hereunder except to the extent that
Partnership funds are reasonably available
to it for the performance of such
duties, and nothing herein contained shall
be deemed to authorize or require the
General Partner, in its capacity as such,
to expend its individual funds for
payment to third parties on behalf of the
Partnership or to undertake any
individual liability or obligation on
behalf of the Partnership.
7.3. Major Decisions. The General Partner shall not, without the
prior
Consent of the Limited Partners, on behalf
of the Partnership, undertake any of
the following actions (the "Major
Decisions"):
(a) Make a general assignment for the benefit of creditors or
appoint or acquiesce in the appointment of a custodian, receiver
or
trustee for all or any part of the assets of the Partnership.
(b) Take title to any personal or real property, other than in
the name of the Partnership, a Property Partnership or pursuant
to
Section 7.9 hereof.
(c) Institute any proceeding for Bankruptcy on behalf of the
Partnership.
(d) Dissolve the Partnership.
49
<PAGE>
Except as specifically provided in this
Agreement, including, without
limitation, this Section 7.3, the Limited
Partners shall have no right to vote
on any matter concerning the business and
affairs of the Partnership, including,
without limitation, any decisions regarding
the merger of the Partnership or the
sale, exchange, lease, mortgage or pledge
or other transfer of, or the granting
of a security interest in; all or
substantially all of the assets of the
Partnership and the incurrence of
indebtedness by the Partnership, whether or
not in the ordinary course of the
Partnership's business.
7.4. Actions with Respect to Certain Documents. Notwithstanding
the
provisions of Section 7.3 hereof to the
contrary, whenever the consent,
agreement, authorization or approval of the
Partnership is required under any
agreement which the Limited Partners or
their Affiliates have executed other
than in their capacities as Limited
Partners of the Partnership, the Consent of
the Limited Partners shall not be
required.
7.5. Reliance by Third Parties. Notwithstanding anything to the
contrary in this Agreement, any Person
dealing with the Partnership shall be
entitled to assume that the General Partner
has full power and authority to
encumber, sell or otherwise use in any
manner any and all assets of the
Partnership and to enter into any contracts
on behalf of the Partnership, and
such Person shall be entitled to deal with
the General Partner as if it were the
partnership's sole party in interest, both
legally and beneficially. Each
Limited Partner hereby waives any and all
defenses or other remedies which may
be available against such Person to
contest, negate or disaffirm any action of
the General Partner in connection with any
such dealing. 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. Each and every
certificate, document or other instrument
executed on behalf of the Partnership by
the General Partner 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
effect such certificate, document or
instrument, this Agreement was in full
force and effect; (ii) the Person
executing and delivering
50
<PAGE>
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.
7.6. Company
Participation. The Company agrees that all business
activities of the Company, including
without limitation all activities
pertaining to the acquisition, development,
ownership, management and leasing of
real properties, shall be conducted,
directly or indirectly, through the
Partnership (except for: (i) property
management and leasing activities
conducted through the Management Company
pursuant to the Management Agreement;
and (ii) the Company's direct and indirect
interests in any Property
Partnerships or subsidiaries other than
through the Partnership). The Company
agrees that all borrowings for the purpose
of making distributions to its
stockholders will be incurred by the
Partnership or by one or more of the
Property Partnerships and the proceeds of
such indebtedness will be included as
Net Financing Proceeds hereunder.
7.7. Proscriptions. Except as otherwise expressly authorized
herein,
the General Partner shall not have the
authority to:
(a) Do any act in contravention of this Agreement or which
would make it impossible to carry on the ordinary business of
the
Partnership;
(b) Possess any Partnership property or assign rights in
specific Partnership property for other than Partnership purposes;
or
(c) Do any act in contravention of applicable law. Nothing
herein contained shall impose any obligation on any Person or
firm
doing business with the Partnership to inquire as to whether or not
the
General Partner has properly exercised its authority in executing
any
contract, lease, mortgage, deed or other instrument on behalf of
the
Partnership, and any such third Person shall be fully protected
in
relying upon such authority.
7.8. Additional Partners. The General Partner shall have the right
to
admit additional Partners to the
Partnership in accordance with the provisions
of this Agreement.
51
<PAGE>
7.9. Title Holder. To the extent allowable under applicable law,
title
to all or any part of the Properties of the
Partnership may be held in the name
of the Partnership or in the name of any
other Person, provided, however, that
all of the beneficial interest in such
Properties shall at all times be vested
in the Partnership. Any such title holder
shall perform any and all of its
respective functions to the extent and upon
such terms and conditions as may be
determined from time to time by the General
Partner, consistent with the
business purposes of the Partnership.
7.10. Compensation of the General Partner. The General Partner
shall
not be entitled to any compensation for
services rendered to the Partnership
solely in its capacity as General Partner
except with respect to reimbursement
for those costs and expenses constituting
Administrative Expenses.
7.11. Waiver and Indemnification.
(a) Neither the General Partner nor any Person acting on its
behalf,
pursuant hereto, shall be liable,
responsible or accountable in damages or
otherwise to the Partnership or to any
Partner for any acts or omissions
performed or omitted to be performed by
them within the scope of the authority
conferred upon the General Partner by this
Agreement and the Act, provided that
the General Partner's or such other
Person's conduct or omission to act was
taken in good faith and in the belief that
such conduct or omission was in the
best interests of the Partnership and,
provided further, that the General
Partner or such other Person shall not be
guilty of fraud, misconduct or gross
negligence. The Partnership shall, and
hereby does, indemnify and hold harmless
the General Partner and its Affiliates and
any individual acting on their behalf
from any loss, damage, claim or liability,
including, but not limited to,
reasonable attorneys' fees and expenses,
incurred by them by reason of any act
performed by them in accordance with the
standards set forth above or in
enforcing the provisions of this indemnity;
provided, however, no Partner shall
52
<PAGE>
have any personal liability with respect to
the foregoing indemnification, any
such indemnification to be satisfied solely
out of the assets of the
Partnership.
(b) Any Person entitled to indemnification under this Agreement
shall
be entitled to receive, upon application
therefor, advances to cover the costs
of defending any proceeding against such
Person; provided, however, that such
advances shall be repaid to the
Partnership, without interest, if such Person is
found by a court of competent jurisdiction
upon entry of a final judgment not to
he entitled to such indemnification. All
rights of the indemnitee hereunder
shall survive the dissolution of the
Partnership; provided, however, that a
claim for indemnification under this
Agreement must be made by or on behalf of
the Person seeking indemnification prior to
the time the Partnership is
liquidated hereunder. The indemnification
rights contained in this Agreement
shall be cumulative of, and in addition to,
any and all rights, remedies and
recourse to which the person seeking
indemnification shall be entitled, whether
at law or at equity. Indemnification
pursuant to this Agreement shall be made
solely and entirely from the assets of the
Partnership and no Partner shall be
liable therefor.
7.12. Limited Partner Representatives. Upon written notice to
the
General Partner, any Limited Partner or
group of Limited Partners may appoint a
representative to act on its or their
behalf with respect to all Partnership
matters, including exercising all voting
rights of the Partnership Units owned
by such Limited Partner. Whenever, under
the terms of this Agreement, matters
require the Consent of the Limited
Partners, the same shall mean the consent of
Limited Partner Representatives entitled to
exercise voting rights with respect
to a majority of the Partnership Units
entitled to vote thereon, and any action
taken by the Limited Partner
Representatives shall be fully binding on the
Limited Partners; it being the intention of
the Limited Partners that the
Limited Partner Representatives shall have
full power and authority, to
53
<PAGE>
take all
action, or to authorize all action, which
the Limited Partners are entitled to
take or authorize under the provisions of
this Agreement. Any appointments of
Limited Partner Representatives made
pursuant to this Section 7.12 shall remain
effective until rescinded in a written
notice to the General partner, and the
General Partner shall have the right and
authority to rely (and shall be fully
protected in so doing) on the actions taken
and directions given by such Limited
Partner Representatives without any further
evidence of their authority or
further action by the Limited Partners that
appointed them. Each of the Limited
Partners (identified on Exhibit G hereto)
hereby appoints JRI (or any person or
entity appointed by JRI upon written notice
to the General Partner; JRI, or such
person or entity appointed by JRI upon
written notice to the General Partner, is
referred to herein as the "Jacobs Limited
Partner Representative") as his, her
or Limited Partner Representative with
respect to all of the Partnership Units
now or hereafter owned by such Limited
Partner and such appointment shall remain
effective with respect to each such Limited
Partner and each transferee of the
Partnership Units of each such Limited
Partner until rescinded with respect to
such Limited Partner or transferee in a
written notice from that Limited Partner
or transferee to the General Partner.
7.13. Operation in Accordance with REIT Requirements. The
Partners
acknowledge and agree that the Partnership
shall be operated in a manner that
will enable the Company to (a) satisfy the
REIT Requirements and (b) avoid the
imposition of any federal income or excise
tax liability. The Partnership shall
avoid taking any action, or permitting to
take any action, which would result in
the Company ceasing to satisfy the REIT
Requirements or would result in the
imposition of any federal income or excise
tax liability on the Company. The
determination as to whether the Partnership
has operated in the manner
prescribed in this Section 7.13 shall be
made without regard to any action or
inaction of the Company with respect to
distributions and
54
<PAGE>
the timing thereof.
7.14. Transactions with Affiliates. The Partnership may lend or
contribute funds to its subsidiaries or
other Entities in which it has an equity
investment, and such Entities may borrow
funds from the Partnership, on terms
and conditions established in the
discretion of the General Partner. The
foregoing authority shall not create any
right or benefit in favor of any
Person. The Partnership may also engage in
other transactions and enter into
contracts with an Affiliate of any Partner,
which transactions and contracts are
on terms fair and reasonable to the
Partnership and no less favorable to the
Partnership than would be obtained from
unaffiliated third parties, provided
however, that the affirmative determination
by the Company's board of directors
shall determine conclusively that a
transaction or contract between the
Partnership on the one hand and the General
Partner or the Company on the other
hand satisfies such requirement.
7.15. 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, or other
document believed by it 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 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
expertise 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
55
<PAGE>
obligations hereunder, to act through any
of its duly
authorized officers and any attorney or
attorneys-in-fact duly appointed by the
General Partner. 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.
(d) Notwithstanding any other provisions of this Agreement or
the Act, any action of the General Partner
on behalf of the Partnership or any
decision of the General Partner to refrain
from acting on behalf of the
Partnership, undertaken in the good faith
belief that such action or omission is
necessary or advisable in order (i) to
protect or further the ability of the
Company to continue to qualify as a REIT or
(ii) to avoid the Company incurring
any taxes under Section 857 or Section 4981
of the Code, is expressly authorized
under this Agreement and is deemed approved
by all of the Limited Partners.
Nothing however in this Agreement shall be
deemed to give rise to any liability
on the part of the Limited Partners for the
Company's failure to qualify or
continue to qualify as a REIT or failure to
avoid incurring any taxes under the
foregoing Sections of the Code.
ARTICLE VIII.
Dissolution, Liquidation and Winding-Up
8.1. Accounting. In the event of the dissolution, liquidation
and
winding-up of the Partnership, a proper
accounting (which shall be certified)
shall be made of the Capital Account of
each Partner and of the Net Income or
Net Losses of the Partnership from the date
of the last previous accounting to
the date of dissolution. Financial
statements presenting such accounting shall
include a report of a national certified
public accountant (which may be the
Accountant) selected by the Liquidating
Trustee.
56
<PAGE>
8.2. Distribution on Dissolution. In the event of the dissolution
and
liquidation of the Partnership for any
reason, the assets of the Partnership
shall be liquidated for distribution in the
following rank and order:
(a) Payment of creditors of the Partnership (other than
Partners) in the order of priority as provided by law;
(b) Establishment of reserves as provided by the Liquidating
Trustee to provide for contingent liabilities, if any;
(c)
Payment of debts of the Partnership to Partners, if any,
in the order of priority provided by law; and
(d) To the Partners in accordance with the positive balances
in their Capital Accounts after giving effect to all
contributions,
distributions and allocations for all periods, including the period
in
which such distribution occurs (other than those adjustments
made
pursuant to this Section 8.2(d), Section 8.4 or Section 8.5
hereof).
Whenever the Liquidating Trustee reasonably
determines that any reserves
established pursuant to paragraph (b) above
are in excess of the reasonable
requirements of the Partnership, the amount
determined to be excess shall be
distributed to the Partners in accordance
with the above provisions.
Notwithstanding the foregoing, all
distributions pursuant to this Section 8.2
shall remain subject to the provisions of
(i) the Certificate of Designation for
each class or series of Preferred Units set
forth in Exhibit B hereto; (ii)
Exhibit E hereto with respect to the SCUs,
(iii) Exhibit H with respect to the
S-SCUs and (iv) Exhibit J with respect to
the L-SCUs.
8.3. Timing Requirements. In the event that the Partnership is
"liquidated" within the meaning of Section
1.704-1(b)(2)(ii)(g) of the
Regulations, any and all distributions to
the Partners pursuant to Section
8.2(d) hereof shall be made no later than
the later to occur of (i) the last day
of the taxable year of the Partnership in
which such liquidation occurs or (ii)
ninety (90) days after the date of such
liquidation.
8.4. Sale of Partnership Assets. In the event of the liquidation of
the
Partnership in accordance with the terms of
this Agreement, the Liquidating
Trustee may sell Partnership or Property
Partnership property or Property
Partnership interests on the best terms and
conditions as the Liquidating
Trustee in good faith believes are
reasonably available at the time and under
57
<PAGE>
the circumstances and on a non-recourse
basis to the Limited Partners. The
liquidation of the Partnership shall not be
deemed finally completed until the
Partnership shall have received cash
payments in full with respect to
obligations such as notes, installment sale
contracts or other similar
receivables received by the Partnership in
connection with the sale of
Partnership assets and all obligations of
the Partnership have been satisfied,
released or assumed by the General Partner.
The Liquidating Trustee shall
continue to act to enforce all of the
rights of the Partnership pursuant to any
such obligations until such obligations are
paid in full or otherwise satisfied.
8.5. Distributions in Kind. In the event that it becomes necessary
to
make a distribution of Partnership property
in kind, the General partner may
Transfer and convey such property to the
distributees as tenants in common,
subject to any liabilities attached
thereto, so as to vest in them undivided
interests in the whole of such property in
proportion to their respective rights
to share in the proceeds of the sale of
such property (other than as a creditor)
in accordance with the provisions of
Section 8.2 hereof.
8.6. Documentation of Liquidation. Upon the completion of the
dissolution and liquidation of the
Partnership, the Partnership shall terminate
and the Liquidating Trustee shall have the
authority to execute and record any
and all documents or instruments required
to effect the dissolution, liquidation
and termination of the Partnership.
8.7. Liability of the Liquidating Trustee. The Liquidating
Trustee
shall be indemnified and held harmless by
the Partnership from and against any
and all claims, demands, liabilities,
costs, damages and causes of action of any
nature whatsoever arising out of or
incidental to the Liquidating Trustee's
taking of any action authorized under or
within the scope of this Agreement;
provided, however, that the Liquidating
Trustee shall not be entitled to
indemnification, and shall not be held
harmless, where the claim, demand,
liability, cost, damage
58
<PAGE>
or cause of action at issue arose out
of:
(a) A matter entirely unrelated to the Liquidating Trustee's
action or conduct pursuant to the provisions of this Agreement;
or
(b) The proven misconduct or gross negligence of the
Liquidating Trustee.
ARTICLE IX.
Transfer of Partnership Units
9.1. General Partner Transfer. The General Partner shall not
withdraw
from the Partnership and shall not sell,
assign, pledge, encumber or otherwise
dispose of all or any portion of its
Partnership Units, in each case prior to
the dissolution and winding up of the
Partnership, without the Consent of the
Limited Partners. Upon any Transfer of a
Partnership Unit in accordance with the
provisions of this Section 9.1, the
transferee General Partner shall become
vested with the powers and rights of the
transferor General Partner, and shall
be liable for all obligations and
responsible for all duties of the General
Partner, once such transferee has executed
such instruments as may be necessary
to effectuate such admission and to confirm
the agreement of such transferee to
be bound by all the terms and provisions of
this Agreement with respect to the
Partnership Unit so acquired. It is a
condition to any Transfer otherwise
permitted hereunder that the transferee
assume by operation of law or express
agreement all of the obligations of the
transferor General Partner under this
Agreement with respect to such transferred
Partnership Units and no such
Transfer (other than pursuant to a
statutory merger or consolidation wherein all
obligations and liabilities of the
transferor General Partner are assumed by a
successor corporation or other Entity to
the General Partner by operation of
law) shall relieve the transferor General
Partner of its obligations under this
Agreement without the Consent of the
Limited Partners, in their reasonable
discretion. In the event the General
Partner withdraws from the Partnership in
violation of this Agreement or otherwise,
dissolves or terminates or upon the
Bankruptcy of the General Partner, (i) any
remaining general partner may
continue the Partnership business or (ii)
within 90 days thereafter, all of the
remaining Partners
59
<PAGE>
(or, to the extent permitted under the Act,
such lesser
number or percentage of the Partners, but
in no case less than a
Majority-in-Interest of the Limited
Partners) may elect to continue the business
of the Partnership by selecting a
substitute General Partner, which substitute
General Partner accepts such election and
agrees to serve as the General
Partner.
Such successor General Partner shall thereupon succeed to the
rights
and obligations of the General Partner as
provided in this Section 9.1.
9.2. Transfers by Limited Partners.
(a) Subject to the provisions of Section 9.3 hereof, each
Limited Partner shall have the right to
Transfer all or a portion of its
Partnership Units to any Person that is the
Immediate Family of such Limited
Partner, an Affiliate of such Limited
Partner, another Limited Partner, an
institutional lender as security for a bona
fide obligation of such Limited
Partner, a bona fide pledge after a default
in the obligation secured by the
pledge (or to a bona fide purchaser for
value from such pledge), provided in
each such case that prior written notice of
the proposed Transfer is delivered
to the General Partner. Any transfer of
Partnership Units permitted by the first
sentence of this Section 9.2(a) or by any
other provision of this Agreement
(including, for example, Section 9.2(c) and
Paragraph 8 of Exhibit E)
automatically will be admitted as a
Substituted Limited Partner upon the filing
with the Partnership of (A) a duly executed
and acknowledged instrument of
assignment between the transferor and the
transferee specifying the Partnership
Units being assigned, setting forth the
intention of the transferor that such
transferee succeed to the transferor's
interest as a Limited Partner with
respect to the Partnership Units being
assigned and agreement of the transferee
assuming all of the obligations of a
Limited Partner under this Agreement with
respect to such transferred Partnership
Units accruing from and after the date
of transfer, (B) a duly executed and
acknowledged instrument
60
<PAGE>
by which the
transferee confirms to the Partnership that
it accepts and adopts the provisions
of this Agreement applicable to a Limited
Partner and (C) any other instruments
reasonably required by the General Partner
and payment by the transferor of a
transfer fee to the Partnership sufficient
to cover the reasonable expenses of
the transfer, if any.
(b) Except as set forth in Section 9.2(a) above, or elsewhere
in this Agreement (including Section 9.2(c)
and Paragraph 8 of Exhibit E), no
Transfer of a Limited Partner's Partnership
Units may be effected without the
consent of the General Partner, which
consent may be given, withheld or
conditioned in the General Partner's sole
and absolute discretion. A transferee
of Partnership Units shall be deemed to be
an Assignee with respect to such
Partnership Units, but shall not become or
be admitted to the Partnership as a
Substituted Limited Partner without the
consent of the General Partner, which
consent may be given or withheld in the
General Partner's sole and absolute
discretion. An Assignee shall be entitled
as a result of such Transfer only to
receive the economic benefits of the
Partnership Units to which the transferor
Limited Partner would otherwise be
entitled, along with such transferor Limited
Partner's rights with respect to the Rights
or such other exchange rights as are
applicable to the Transferred Partnership
Units (although any transferee of any
Transferred Partnership Units shall be
subject to any and all ownership
limitations contained in the corporate
charter of the Company as may be amended
from time to time), and such Assignee shall
have no right (i) to participate in
the management of the Partnership or to
vote on any matter requiring the consent
or approval of the Limited Partners, (ii)
to demand or receive any account of
the Partnership's business, or (iii) to
inspect the Partnership's books and
records, unless and until such Assignee is
admitted to the partnership as a
Substituted Limited Partner. In addition,
unless and until a transferee is
admitted to the Partnership as a
Substituted Limited Partner, the transferor
Limited
61
<PAGE>
Partner shall not be relieved of its
obligations under this Agreement
(except in the case of the Transfer
pursuant to a statutory merger or
consolidation wherein all obligations and
liabilities of the transferor Limited
Partner are assumed by a successor
corporation or other Entity by operation of
law). A transferee of Partnership Units may
become a Substituted Limited Partner
only upon the satisfaction of the following
conditions: (A) the filing with the
Partnership of a duly executed and
acknowledged written instrument of assignment
between the transferor and the transferee
in a form approved by the General
Partner specifying the Partnership Units
being assigned, setting forth the
intention of the transferor that such
transferee succeed to the transferor's
interest as a Limited Partner with respect
to the Partnership Units being
assigned and agreement of the transferee
assuming all of the obligations of a
Limited Partner under this Agreement with
respect to such transferred
Partnership Units accruing from and after
the date of transfer; (B) execution
and acknowledgment by the transferor
Limited Partner and such transferee of any
other instruments required in the sole and
absolute discretion of the General
Partner, including the acceptance and
obligation by such transferee of the
provisions of this Agreement; (C) obtaining
the written consent of the General
Partner as provided in the second sentence
of this Section 9.2(b); and (D)
payment of a transfer fee to the
Partnership, sufficient to cover the reasonable
expenses of the substitution, if any. Any
transferee, whether or not admitted as
a Substituted Limited Partner, shall take
its rights to the transferred
Partnership Units subject to the
obligations of the transferor Limited Partner
hereunder.
(c) The Approved Transfers permitted in Paragraph 8 of Exhibit
E hereto shall also be available, mutatis
mutandis, to holders of any Common
Units issued in exchange for or upon the
redemption of SCUs.
(d) The applicable Approved Transfers permitted in Paragraph 8
of Exhibit H
62
<PAGE>
hereto shall also be available, mutatis
mutandis, to holders of any
Common Units issued in exchange for or upon
the redemption of S-SCUs.
(e) The applicable Approved Transfers permitted in Paragraph 8
of Exhibit J hereto shall also be
available, mutatis matandis, to holders of any
Common Units issued in exchange for or upon
the redemption of L-SCUs. 9.3.
Restrictions on Transfer. In addition to
any other restrictions on Transfer
herein contained, in no event may any
Transfer of a Partnership Unit by any
Partner be made and in no event shall
Additional Units be issued (i) to any
Person or Entity who or which lacks the
legal right, power or capacity to own a
Partnership Unit, or, except with the prior
written consent of the General
Partner, to a Person or Entity which is not
an "Accredited Investor" within the
meaning of Regulation D promulgated by the
SEC under the Securities Act; (ii) in
violation of any provision of any mortgage
or trust deed (or the note or bond
secured thereby) constituting a Lien
against a Property or any part thereof, or
other instrument, document or agreement to
which the Partnership or any Property
Partnership is a party or otherwise bound
(including, without limitation, the
organizational documents of any Property
Partnership); (iii) in violation of
applicable law; (iv) of any component
portion of a Partnership Unit, such as the
Capital Account, or rights to Net Cash
Flow, separate and apart from all ether
components of a Partnership Unit; (v) in
the event such Transfer would cause the
Company to cease to comply with the REIT
Requirements; (vi) if such Transfer
would cause a termination of the
Partnership for federal income tax purposes
(except with the Consent of the General
Partner and the Consent of the Limited
Partners); (vii) if such Transfer would, in
the opinion of counsel to the
Partnership, cause the Partnership to cease
to be classified as a partnership
for federal income tax purposes; (viii) if
such Transfer would cause the
Partnership to become, with respect to any
employee
63
<PAGE>
benefit plan subject to
Title 1 of ERISA, a "party-in-interest" (as
defined in Section 3(14) of ERISA)
or a "disqualified person" (as defined in
Section 4975(c) of the Code); (ix) if
such Transfer would, in the opinion of
counsel to the Partnership, cause any
portion of the assets of the Partnership to
constitute assets of any employee
benefit plan pursuant to Department of
Labor Regulations Section 2510.3-101; (x)
if such Transfer would result in (A) the
transferor or the transferee owning
Common Units having a value (computed as of
the date of such proposed Transfer
by multiplying the Common Stock amount with
respect to such Common Units by the
Current Per Share Market Price) less than
$250,000, unless either the transferee
is an existing Limited Partner or the
General Partner has consented to such
issuance or transfer, or (B) the transferee
owning Common Units having a value
(computed as of the date of such proposed
Transfer by multiplying the Common
Stock Amount with respect to such Common
Units by the Current Per Share Market
Price) less than $250,000, unless such
Common Units constitute all of the Common
Units then owned by such transferor or the
General Partner has consented to such
issuance or transfer; (xi) if such Transfer
or issuance may not be effected
without registration of such Partnership
Units under the Securities Act, would
require filing of a registration statement
under the Securities Act, or would
otherwise violate any Federal, state or
foreign securities laws or regulations
applicable to the Partnership or such
Partnership Units; (xii) if such Transfer
or issuance would violate any provision of
the Company's certificate of
incorporation as such may be amended from
time to time; (xiii) to a lender to
the Partnership or any Person who is
related (within the meaning of Section
1.752-4(b) of the Regulations) to any
lender to the Partnership whose loan
constitutes a "nonrecourse liability"
(within the meaning of Section
1.752-1(a)(2) of the Regulations) without
the consent of the General Partner, in
its sole and absolute discretion, unless
the Partnership's basis for tax
purposes would not be reduced as a result
of such Transfer;
64
<PAGE>
(xiv) except with
the express written consent of the General
Partner, if such Transfer, in the
opinion of counsel to the General Partner,
would result in either the
Partnership having more than one hundred
Partners or in the Partnership being
classified as a "publicly traded
partnership" within the meaning of the Code and
the Regulation; (xv) except with the
express written consent of the General
Partner, to any entity that is a
partnership, grantor trust or S corporation if
(A) substantially all of the value of the
interest of a person owning an
interest in such entity is attributable to
the entity's (direct or indirect)
interest in a Unit, and (B) a principal
purpose of the use of the tiered
arrangement is to permit the Partnership to
satisfy the 100-person limitation in
paragraph (h) (i) (ii) of Section 1.7704-1
of the Regulations; or (xvi) except
with respect to (A) transfers qualifying as
"private Transfer" for purposes of
Regulations Section 1.7704-1(e) or any
successor provision or (B) up to two
Transfers (excluding for this purpose,
transfers qualifying as "private
transfers") of interests directly or
indirectly held by the estate of or other
successor to, a person that has died within
the preceding twelve (12) months, if
the General Partner determines in its
reasonable discretion that if it permitted
such transfer the Partnership would be
unable to obtain an opinion of counsel
recognized standing to the effect that the
Partnership should not be treated as
a "publicly traded partnership" within the
meaning of Section 7704(b) of the
Code.
ARTICLE X.
Rights and Obligations of the Limited Partners
10.1. No Participation in Management.
(a) Except as expressly permitted hereunder, the Limited Partners,
in
their capacities as Limited
Partners of the Partnership, shall not take part
in the management of the
Partnership's business, transact any business in the
Partnership's name or have the
power to sign documents
65
<PAGE>
for or otherwise bind
the Partnership, provided,
however, that nothing in the foregoing shall be
deemed to prohibit or preclude any
Limited Partner or its Affiliates from
serving as an officer, director or
employee of the Company, the General
Partner or Management Company or
otherwise transacting business with the
Partnership.
(b) In addition to other rights provided by this Agreement or by
the
Act, each Limited Partner shall have the
right, for a purpose reasonably related
to such Limited Partner's interest as a
limited partner in the Partnership, upon
written demand with a statement of the
purpose of such demand and at such
Limited Partner's own expense (including
such copying and administrative charges
as the General Partner may establish from
time to time):
(1) to obtain a copy of the most recent annual and
quarterly reports filed with the Securities and Exchange Commission
by
the General Partner pursuant to the Securities Exchange Act of
1934;
(2) to obtain a copy of the Partnership's federal,
state and local income tax returns for each Partnership Year;
(3) to obtain a current list of the name and last
known business, resident or mailing address of each Partner;
and
(4) to obtain a copy of this Agreement and the
Certificate of Limited Partnership and all amendments thereto,
together
with executed copies of all powers of attorney pursuant to which
this
Agreement, the Certificate and all amendments thereto have been
executed.
10.2. Bankruptcy of a Limited Partner. The Bankruptcy of any
Limited
Partner shall not cause a dissolution of
the Partnership, but the rights of such
Limited Partner to share in the Net Income
or Net Losses of the Partnership and
to receive distributions of Partnership
funds shall, on the happening of such
event, devolve on its successors or
assigns, subject to the terns and conditions
of this Agreement, and the Partnership
shall continue as a limited partnership.
In no event, however, shall such
assignee(s) become an Assignee Limited Partner
except in accordance
66
<PAGE>
with Article IX hereof.
10.3. No Withdrawal. No Limited Partner may withdraw from the
Partnership without the prior written
consent of the General Partner, other than
as expressly provided in this
Agreement.
10.4. Duties and Conflicts. The General Partner recognizes that
certain
of the Limited Partners and their
Affiliates have or may have other business
interests, activities and investments, some
of which may be in conflict or
competition with the business of the
Partnership, and that such Persons are
entitled to carry on such other business
interests, activities and investments.
Such Limited Partners and their Affiliates
may engage in or possess an interest
in any other business or venture of any
kind, independently or with others, on
their own behalf or on behalf of other
entities with which they are affiliated
or associated, and such Persons may engage
in any activities, whether or not
competitive with the Partnership, without
any obligation to offer any interest
in such activities to the Partnership or to
any Partner. Neither the Partnership
nor any Partner shall have any right, by
virtue of this Agreement, in or to such
activities, or the income or profits
derived therefrom, and the pursuit of such
activities, even if competitive with the
business of the Partnership, shall not
be deemed wrongful or improper.
10.5. Limited Liability. No Limited Partner shall be bound, or
personally liable for, the expenses,
liabilities or obligations of the
Partnership, except as provided by this
Agreement or the Act.
ARTICLE XI.
Grant of Rights to Limited Partners
11.1. Grant of Rights. The Company does hereby grant to each
Limited
Partner, and each of the Limited Partners
does hereby accept, the right, but not
the obligation (hereinafter
67
<PAGE>
referred to as the "Rights"), to require
the Company
and the General Partner to exchange part or
all of the Limited Partner's Common
Units for shares of Common Stock or their
cash equivalent, at the Company's
election, at any time or from time to time
prior to November 3, 2043, on the
terms and subject to the conditions and
restrictions contained in Exhibit D
hereto. The Rights granted hereunder may be
exercised by any one or more of the
Limited Partners, on the terms and subject
to the conditions and restrictions
contained in Exhibit D hereto, upon
delivery to the Company of an Exchange
Notice, which notice shall specify the
number of Common Units to be exchanged by
such Limited Partner. Once delivered, the
Exchange Notice shall be irrevocable,
subject to delivery by the Company or the
General Partner of the exchange
consideration in respect of the Common
Units being exchanged in accordance with
the terms hereof. Notwithstanding the
forgoing, upon the issuance of any Common
Units the General Partner and the Partner
to who such Common Units are issued
may agree that such Common Units are not
entitled to the Rights. Notwithstanding
the foregoing, the rights in respect of the
Common Units issued upon the
redemption or exchange of SCUs shall be
subject to the terms, conditions and
restrictions set forth in Exhibit F hereto
and the Rights in respect of the
Common Units issued upon the redemption or
exchange of S-SCUs shall be subject
to the terms, conditions and restrictions
set forth in Exhibit I hereto.
11.2. Terms of Rights. The terms and provisions applicable to
the
Rights shall be as set forth in attached
Exhibit D. Notwithstanding the
foregoing, the terms and provisions
applicable to the Rights in respect of the
Common Units issued upon the redemption or
exchange of SCUs shall be as set
forth in Exhibit F hereto and the terms and
provisions applicable to the Rights
in respect of the Common Units issued upon
the redemption or exchange of S-SCUs
shall be as set forth in Exhibit I
hereto.
68
<PAGE>
ARTICLE XII.
Indemnification
12.1. Indemnification of the Limited Partners. From and after the
date
hereof, the Partnership shall indemnify and
hold harmless each of the Limited
Partners and its Affiliates against and
from all liability, demands, claims,
actions or causes of action, assessments,
losses, fines, penalties, costs,
damages and expenses (including, without
limitation, reasonable attorneys' and
accountants' fees and expenses) (each, a
"Claim") sustained or incurred by such
Limited Partner or Affiliate or any
assignee or successor thereof (including,
without limitation, any Assignee Limited
Partner) as a result of or arising out
of any Assumed Liability. If a claim for
indemnification is asserted against the
Partnership hereunder, the Partnership
shall have the right, at its own expense,
to participate in the defense of any Claim
asserted against such Limited Partner
or its Affiliate which resulted in the
claim for indemnification, and if such
right is exercised, the parties shall
cooperate in the defense of such action or
proceeding.
12.2. Indemnification of the General Partner, the Company and
Others.
From and after the date hereof, the
Partnership shall indemnify and hold
harmless each of the General Partner, the
Company and any officer; director,
employee or agent of any of the
Partnership, the General Partner or the Company
against and from all for the same matters
and to the same extent as the Company
is entitled to indemnify its officers,
directors, employees or agents pursuant
to the Company's certificate of
incorporation, as such may be amended from time
to time.
ARTICLE XIII.
Arbitration of Disputes
13.1. Arbitration. Notwithstanding anything to the contrary
contained
in this Agreement, all claims, disputes and
controversies between the parties
hereto (including, without limitation, any
claims, disputes and controversies
between the Partnership and any one or
more
69
<PAGE>
of the Partners and any claims,
disputes and controversies between any one
or more Partners) arising out of or
in connection with this Agreement or the
Partnership created hereby, relating to
the validity construction, performance,
breach, enforcement or termination
thereof, or otherwise, shall he resolved by
binding arbitration in New York, New
York, in accordance with this Article XIII
and to the extent not inconsistent
herewith, the Expedited Procedures and
Commercial Arbitration Rules of the
American Arbitration Association or any
successor thereto.
13.2. Procedures. Any arbitration called for by this Article XIII
shall
be conducted in accordance with the
following procedures:
(a) The Partnership or any Partner (the "Requesting Party")
may
demand arbitration pursuant to Section 13.1 hereof at any time
by
giving written notice of such demand (the "Demand Notice") to all
other
Partners and (if the Requesting Party is not the Partnership) to
the
Partnership, which Demand Notice shall describe in reasonable
detail
the nature of the claim, dispute or controversy.
(b) Within fifteen (15) days after the giving of a Demand
Notice, the Requesting Party, on the one hand, and each of the
other
Partners and/or the Partnership against whom the claim has been
made or
with respect to which a dispute has arisen (collectively, the
"Responding Party"), on the other hand, shall select and designate
in
writing to the other party one reputable, disinterested individual
(a
"Qualified Individual") willing to act as an arbitrator of the
claim,
dispute or controversy in question. Each of the Requesting Party
and
the Responding Party shall use their best efforts to select a
present
or former partner of a national accounting firm having no
affiliation
with any of the parties as their respective Qualified Individual to
act
as the second arbitrator. Within fifteen (15) days after the
foregoing
selections have been made, the arbitrators so selected shall
jointly
select a present or former partner of a national accounting firm
having
no affiliation with any of the parties as the third Qualified
Individual willing to act as an arbitrator of the claim, dispute
or
controversy in question. In the event that the two arbitrators
initially selected are unable to agree on a third arbitrator within
the
second fifteen (15) day period referred to above, then, on the
application of either party, the American Arbitration Association
shall
promptly select and appoint a present or former partner of a
national
accounting firm having no affiliation with any of the parties as
the
Qualified Individual to act as the third arbitrator. The three
arbitrators selected pursuant to this subsection (b) shall
constitute
the arbitration panel for the arbitration in question.
(c) The presentations of the parties hereto in the arbitration
proceeding shall be commenced and completed within sixty (60)
days
after the selection of the arbitration panel pursuant to subsection
(b)
above, and the arbitration panel shall render its decision in
writing
within thirty (30) days after the completion of such presentations.
Any
decision
70
<PAGE>
concurred in by any two (2) of the arbitrators shall
constitute the decision of the arbitration panel, and unanimity
shall
not be required.
(d) The arbitration panel shall have the discretion to include
in its decision a direction that all or part of the attorneys' fees
and
costs of any party or parties and/or the costs of such arbitration
be
paid by any other party or parties. On the application of a
party
before or after the initial decision of the arbitration panel,
and
proof of its attorneys' fees and costs, the arbitration panel
shall
order the other party to make any payments directed pursuant to
the
preceding sentence.
13.3. Binding Character. Any decision rendered by the arbitration
panel
pursuant to this Article XIII shall be
final and binding on the parties hereto,
and judgment thereon may be entered by any
state or federal court of competent
jurisdiction.
13.4. Exclusivity. Arbitration shall be the Exclusive method
available
for resolution of claims, disputes and
controversies described in Section 13.1
hereof, and the Partnership and its
Partners stipulate that the provisions
hereof shall be a complete defense to any
suit, action, or proceeding in any
court or before any administrative or
arbitration tribunal with respect to any
such claim, controversy or dispute. The
provisions of this Article XIII shall
survive the dissolution of the
Partnership.
13.5. No Alteration of Agreement. Nothing contained herein shall
be
deemed to give the arbitrators any
authority, power or right to alter, change,
amend modify, add to, or subtract from any
of the provisions of this Partnership
Agreement.
ARTICLE XIV
General Provisions
14.1 Notices. All notices, offers or other communications required
or
permitted to be given pursuant to this
Agreement shall be in writing and may be
personally served, telecopied or sent by
United States mail and shall be deemed
to have been given when delivered in
person, upon receipt of telecopy or three
business days after deposit in United
States mail registered or certified,
postage prepaid, and properly addressed by
or to the appropriate party. For
purposes
71
<PAGE>
of this Section 14.1, the address of the
General Partner shall be: 2030
Hamilton Place Boulevard, Suite 500, CBL
Center, Chattanooga, Tennessee 37421
(telecopier number (423) 490-8662) and the
address of each of the Limited
Partners shall be c/o CBL & Associates
Properties, Inc., 2030 Hamilton Place
Boulevard, Suite 500, CBL Center,
Chattanooga, Tennessee 37421 (telecopier
number (423) 490-8662). The address of any
party hereto may be changed by a
notice in writing given in accordance with
the provisions hereof.
14.2. Successor. This Agreement and all the terms and provisions
hereof
shall be binding upon and shall inure to
the benefit of all Partners, and their
legal representatives, heirs, successors
and permitted assigns, except as
expressly herein otherwise provided.
14.3. Effect and Interpretation. This Agreement shall be governed
by
and construed in conformity with the laws
of the State of Delaware.
14.4. Counterparts. This Agreement may be executed in
counterparts,
each of which shall be an original, but all
of which shall constitute one and
the same instrument.
14.5. Partners Not Agents. Nothing contained herein shall be
construed
to constitute any Partner the agent of
another Partner, except as specifically
provided herein, or in any manner to limit
the Partners in the carrying on of
their own respective businesses or
activities. Notwithstanding anything to the
contrary contained herein, no recourse
shall be had by the Partnership or any
Partner against any director, shareholder,
officer, employee, agent or attorney
of the General Partner acting in such
capacity for any act or omission of the
General Partner or any obligation or
liability of the General Partner under this
Agreement, and none of the foregoing shall
have any personal liability for or
with respect to any of the foregoing.
14.6. Entire Understanding; Etc. This Agreement constitutes the
entire
agreement and understanding among the
Partners and supersedes any prior
understandings and/or written or oral
72
<PAGE>
agreements among them respecting the
subject matter within.
14.7. Amendments.
(a) Except to the extent expressly otherwise provided herein
(including, without limitation, in Section
14.7(b) below), this Agreement may
not be amended unless such amendment is
approved by the General Partner with the
prior Consent of the Limited Partners;
provided that no amendment of this
Agreement may be made without the consent
of all of the affected Limited
Partners if such amendment (i) converts any
Limited Partner's interest in the
Partnership into a general partnership
interest (other than the General Partner
if the General Partner is also a Limited
Partner), (ii) modifies the limited
liability of any Limited Partner if the
General Partner is also a Limited
Partner), or (iii) alters or modifies the
Rights set forth in Article XI in a
manner adverse to such Partner.
(b) Notwithstanding anything to the contrary provided in
Section 14.7(a) above, the General Partner
shall have the power, without the
consent of any Limited Partner, to amend
this Agreement as may be required to
facilitate or implement any of the
following:
(i) to add to the obligations of the General
Partner or surrender any right or power
granted to the General Partner or any
Affiliate of the General Partner for the
benefit of the Limited Partners;
(ii) to reflect the admission, substitution,
termination, or withdrawal of Partners
in
accordance with this Agreement;
(iii) to set forth the rights, powers and
duties of the holders of any Additional
Units
issued pursuant to Section 4.4(a) hereof (including, without
limitation, amending the distribution and allocation provisions
set
forth herein);
(iv) to reflect any change that does not
adversely affect the Limited Partners in
any
material respect, to cure any ambiguity, to correct or supplement
any
defective provision in this Agreement, or to make other changes
with
respect to matters arising under this Agreement that will not
be
inconsistent with any other provision of this Agreement; and
(v) to satisfy any requirements, conditions~
or guidelines
73
<PAGE>
contained in any order, directive, opinion, ruling or regulations
of
a Federal or state agency or contained in
Federal or state law.
(c) This Section 14.7 may not be amended except with the prior
written consent of all the Partners. 14.8. Severability. If any
provision of this Agreement, or the application of such provision
to
any person or
circumstance, shall be held invalid by a
court of competent jurisdiction, the
remainder of this Agreement, or the
application of such provision to persons or
circumstances other than those to which it
is held invalid by such court, shall
not be affected thereby.
14.9. Pronouns and Headings. As used herein, all pronouns shall
include
the masculine, feminine and neuter, and all
defined terms shall include the
singular and plural thereof wherever the
context and facts require such
construction. The headings, titles and
subtitles herein are inserted for
convenience of reference only and are to be
ignored in any construction of the
provisions hereof. Any references in this
Agreement to "including" shall be
deemed to mean "including without
limitation".
14.10. Assurances. Each of the Partners shall hereafter execute
and
deliver such further instruments and do
such further acts and things as maybe
required or useful to carry out the intent
and purpose of this Agreement and as
are not inconsistent with the terms
hereof.
14.11. Expenses. All expenses incurred by the Partners in
negotiating,
drafting and executing this Agreement and
the Exhibits hereto, including without
limitation all expenses of counsel, shall
be borne and paid by the Partnership.
14.12. Waiver of Partition. Except as otherwise expressly provided
for
in this Agreement, no Partner shall, either
directly or indirectly, take any
action to require partition or
74
<PAGE>
appraisement of the Partnership or any of
its
assets or properties or cause the sale of
any Partnership assets or property,
and notwithstanding any provision of
applicable law to the contrary, each
Partner (for itself and its legal
representatives, successors and assigns)
hereby irrevocably waives any and all right
to partition, or to maintain any
action for partition, or to compel any sale
with respect to its interest in, or
with respect to, any assets or properties
of the Partnership, except as
expressly provided in this Agreement.
75
<PAGE>
IN WITNESS WHEREOF, the General Partner has executed this
Third Amended and Restated Agreement as of
the date first written above.
CBL HOLDINGS I, INC.
By:/s/ John N. Foy
John N. Foy
Vice Chairman of the Board
And Chief Financial Officer
Accepted and Agreed:
CBL & ASSOCIATES PROPERTIES, INC.
By:/s/ John N. Foy
John N. Foy
Vice Chairman of the Board
And Chief Financial Officer
Consented to:
CBL HOLDINGS II, INC.
By:/s/ John N. Foy
John N. Foy
Vice Chairman of the Board
And Chief Financial Officer
76
<PAGE>
ATTACHMENT 1-A
LIMITED PARTNER ACCEPTANCE
OF PARTNERSHIP AGREEMENT
This Limited Partner Acceptance of Partnership Agreement (this,
"Acceptance") is made as of ____ 2001, by
______, [a _____ organized under the
laws of the State of ____] (the "Limited
Partner"), to and for the benefit of
CBL & Associates Limited Partnership, a
Delaware limited partnership (the
"Partnership").
Capitalized terms used and not defined herein shall have the
meaning
set forth in the Second Amended and
Restated Agreement of Limited Partnership of
the Partnership, dated as of June 30, 1998
as amended through the date hereof
(the "Partnership Agreement").
WHEREAS, on the date hereof, [the partnership has agreed to issue
to
the Limited Partner [______] SCUs (the
"Units") in connection with the closing
of the transactions contemplated by the
Master Contribution Agreement, dated as
of September 25, 2000, among the
Partnership, CBL & Associates Properties, Inc.,
Jacobs Realty Investors Limited Partnership
and Richard E. Jacobs, solely as
Trustee of the Richard E. Jacobs Revocable
Living Trust and the David H. Jacobs
Marital Trust, as amended] [____received
[____] SCUs (the "Units") in connection
with the closing of the transactions
contemplated by the Master Contribution
Agreement, dated as of September 25, 2000
(as amended, the "Master Contribution
Agreement"), among the Partnership CBL
& Associates Properties, Inc., Jacobs
Realty Investors Limited Partnership and
Richard E. Jacobs, solely as Trustee of
the Richard E. Jacobs Revocable Living
Trust and the David H. Jacobs Marital
Trust and transferred all of such Units to
the Limited Partner, its designated
holding entity, as contemplated in the
Master Contribution Agreement]; and
WHEREAS, in connection with the acceptance of the Units by the
Limited
Partner, the Limited Partner has agreed to
affirm its obligations as a limited
partner under the Partnership Agreement
with respect to the Units and to confirm
the additional agreements set forth
herein;
NOW THEREFORE, for good and valuable consideration, the receipt
and
sufficiency of which are hereby
acknowledged, the Limited Partner hereby
confirms that it has been given the
opportunity to review the terms of the
Partnership Agreement and affirms and
agrees that it is bound by each of the
terms and conditions of the Partnership
Agreement applicable to a holder of
SCUs, including; without limitation, the
provisions thereof relating to
limitations and restrictions on the
transfer of SCUs.
IN WITNESS WHEREOF, the Limited Partner has caused this Acceptance
to
be duly executed and delivered as of the
date first written above.
[Insert Name of Limited Partner]
By:______________________________
Name:
77
<PAGE>
Acknowledged and accepted:
CBL & Associates Limited
Partnership
By: CBL Holdings I, Inc.,
General Partner
By:____________________
Name:
Title:
78
<PAGE>
ATTACHMENT 1-B
LIMITED PARTNER ACCEPTANCE OF
PARTNERSHIP AGREEMENT
This Limited Partner Acceptance of Partnership Agreement (this
"Acceptance") is made as of ______, 2004,
by _________, [a ________ organized
under the laws of the State of ____] (the
"Limited Partner"), to and for the
benefit of CBL & Associates Limited
Partnership, a Delaware limited partnership
(the "Partnership").
Capitalized terms used and not defined herein shall have the
meaning set forth in the Second Amended and
Restated Agreement of Limited
Partnership of the Partnership, dated as of
June 30, 1998, as amended through
the date hereof (the "Partnership
Agreement").
WHEREAS, on the date hereof, the Partnership has agreed to
issue to the Limited Partner [_______]
S-SCUs (the "Units") in connection with
the closing of the transactions
contemplated by the Contribution and Exchange
Agreement, dated as of _____________, 2004
(as amended, the "Contribution
Agreement"), by and between Donald Soffer,
Rita Soffer Leeds, Eugene Kessler,
Pittsburg Mall Limited and Monroeville Mall
Partners, L.P. (collectively, the
"Contributors") and the Partnership;
WHEREAS, in connection with the acceptance of the Units by the
Limited Partner, the Limited Partner has
agreed to affirm its obligations as a
limited partner under the Partnership
Agreement with respect to the Units and to
confirm the additional agreements set forth
herein;
NOW THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby
acknowledged, the Limited Partner
hereby confirms that it has been given the
opportunity to review the terms of
the Partnership Agreement and affirms and
agrees that it is bound by each of the
terms and conditions of the Partnership
Agreement applicable to a holder of
S-SCUs, including, without limitation, the
provisions thereof relating to
limitations and restrictions on the
transfer of S-SCUs.
79
<PAGE>
IN WITNESS WHEREOF, the Limited Partner has caused this
Acceptance to be duly executed and
delivered as of the date first written above.
[Insert Name of Limited Partner]
---------------------------------
Name:
Acknowledged and accepted:
CBL & Associates Limited
Partnership
By: CBL Holdings I, Inc.,
General Partner
By:___________________________
Name:
Title:
80
<PAGE>
ATTACHMENT 1-C
LIMITED PARTNER ACCEPTANCE OF
PARTNERSHIP AGREEMENT
This Limited Partner Acceptance of Partnership Agreement (this
"Acceptance") is made as of June 1, 2005 by
Schostak Laurel Park Retail Holding
LLC, a Michigan limited liability company
(the "Limited Partner"), to and for
the benefit of CBL & Associates Limited
Partnership, a Delaware limited
partnership ("the "Partnership").
Capitalized terms used and not defined herein shall have the
meaning set forth in the Second Amended and
Restated Agreement of limited
partnership of the Partnership, dated as of
June 30, 1998, as amended through
the date hereof (the "Partnership
Agreement").
WHEREAS, on the date hereof, the Partnership has agreed to
issue the Limited Partner ________ L-SCUs
(the "Units") in connection with the
closing of the transactions contemplated by
that certain Contribution and
Exchange Agreement dated March 18, 2005
(the "Contribution Agreement"), by and
among Newburgh/Six Mile Limited
Partnership, the Limited Partner and the
Partnership;
WHEREAS, in connection with the acceptance of the Units by the
Limited Partner, the Limited Partner has
agreed to affirm its obligations as a
limited partner under the Partnership
Agreement with respect to the Units and to
confirm the additional agreements set forth
herein;
NOW THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby
acknowledged, the Limited partner
herby confirms that it has been given the
opportunity to review the terms of the
Partnership Agreement and affirms and
agrees that it is bound by each of the
terms and conditions of the Partnership
Agreement applicable to a holder of
L-SCUs, including, without limitation, the
provisions thereof relating to
limitations and restrictions on the
transfer of L-SCUs. The Limited Partner
hereby confirms that Informational
Materials (as defined in the Contribution
Agreement).
[Signature on Next Page]
81
<PAGE>
IN WITNESS WHEREOF, the Limited Partner has caused this
Acceptance to be duly executed and
delivered as of the date first written above.
SCHOSTAK LAUREL PARK
RETAIL
HOLDING LLC
By:
-----------------------------------------
Name:
----------------------------------------
Title:
--------------------------------------
Acknowledged and accepted:
CBL & ASSOCIATES LIMITED
PARTNERSHIP
By: CBL Holdings I, Inc., its
general partner
By:
-----------------------------------------
Name:
Title:
82
<PAGE>
EXHIBIT A
List of Partners, Percentage Interests, Share Equivalents
[Schedule will change as capital is contributed, partners are
redeemed and other
matters impacting percentage interests according to the
terms of this
Agreement. The General Partner shall revise this schedule from
time to time to
reflect
the current status of the partners, their percentage
interests and share equivalents. A current copy of Exhibit A
is available on request by any Partner by request of such
Partner to the General Partner.]
Form of Exhibit A
General Partner
Percentage Interest
Share Equivalents
Limited Partners*1
Percentage Interests
Share Equivalents
*1 - Exhibit A denotes the type of Units a Limited Partner may
hold,
i.e., Common Units, SCUs, S-SCUs and
L-SCUs.
83
<PAGE>
EXHIBIT B
CERTIFICATE OF DESIGNATION
OF
9.0% SERIES A CUMULATIVE REDEEMABLE PREFERRED UNITS
OF
CBL & ASSOCIATES LIMITED PARTNERSHIP
Pursuant to Article 4.4 of the
Second Amended and Restated Partnership Agreement of
CBL & Associates Limited Partnership
WHEREAS, CBL &
Associates Properties,
Inc. (the
"Company")
has issued 2,875,000 shares (the
"Offering") of
9.0% Series A Cumulative Redeemable
Preferred Stock (the "Preferred Stock");
WHEREAS, the Company and the Operating Partnership desire that
the Company contribute net proceeds of the
Offering to CBL & Associates Limited
Partnership (the "Operating Partnership")
in exchange for preferred units having
substantially the same economic rights and
terms of the Preferred Stock;
WHEREAS, Article 4.4 of the Second Amended and Restated
Partnership Agreement of the Operating
Partnership (the "Partnership Agreement")
provides for a Preferred Unit Designation,
setting forth, in sufficient detail,
the economic rights and terms of the class
or series of preferred units.
NOW THEREFORE, CBL Holdings I, Inc., the partner of the
Operating Partnership (the "General
Partner") hereby designates a series of
preferred units and fixes the designations,
powers, preferences and relative,
participating, optional or other special
rights, and the qualifications,
limitations or restrictions thereof, of
such preferred units, as follows:
1. Designation and Amount.
The units of such series shall be designated "9.0% Series A
Cumulative
Redeemable Preferred Units" the ("Series A
Preferred Units") and the number of
units constituting such series shall be
2,875,000. The designations, powers,
preferences and relative, participating,
optional or other special rights, and
the qualifications, limitations or
restrictions thereof, of the Series A
Preferred Units shall be subject in all
cases to the provisions of the
Partnership Agreement.
(a) Holders of Series A Preferred Units shall be entitled to
receive, when, as and if declared by the
General partner, out of assets of the
Operating Partnership legally available
for
84
<PAGE>
the payment of dividends, cumulative
preferential cash dividends at the rate of
9.0% per annum of the $25.00
liquidation preference. Such dividends
shall be cumulative from the date of the
original issue by the Operating Partnership
of series A Preferred Units and
shall be payable quarterly in arrears on
the 30th day of March, June, September,
and December of each year or, if not a
business day: the next succeeding
business day (each, a "Dividend Payment
Date"). The first dividend shall be paid
on September 30, 1998. Such first dividend
and any dividend payable on the
Series A Preferred Units for any partial
dividend period shall be computed on
the basis of a 360-day year consisting of
twelve 30-day months. Dividends will
be payable 50 holders of record as they
appear in the records of the Operating
Partnership at the close of business on the
applicable record date which shall
be the 15th day of the calendar month in
which the applicable Dividend Payment
Date falls or on such other date designated
by the General Partner for the
payment of dividends that is not more than
30 nor less than 10 days prior to
such Dividend Payment Date (each, a
"Dividend Record Date").
(b) No dividends on the Series A Preferred Units shall be
declared by the General Partner or paid or
set apart for payment by the General
Partner at such time as the terms and
provisions of any agreement of the
Operating Partnership, including any
agreement relating to its indebtedness,
prohibits such declaration, payment or
setting apart for payment or provides
that such declaration, payment or setting
apart for payment would constitute a
breach there of or a default thereunder, or
if such declaration or payment shall
be restricted or prohibited by law.
(c) Notwithstanding anything contained herein to the contrary,
dividends on the Series A Preferred Units
shall accrue whether or not the
Operating Partnership has earnings, whether
or not there are funds legally
available for the payment of such
dividends, and whether or not such dividends
are declared. Accrued but unpaid dividends
on the Series A Preferred Units shall
accumulate as of the Dividend Payment Date
on which they first become payable.
(d) Except as set forth in the next sentence, no dividends
shall be declared or paid or set apart for
payment on any of the Operating
Partnership's Common Units ("Common Units")
or units of any other class or
series of units of the Operating
Partnership ranking, as to dividends, on a
parity with or junior to the Series A
Preferred Units letter than a dividend
paid in units of Common Units or in units
of any other class or series of units
ranking junior to the Series A Preferred
Units as to dividends and upon
liquidation) for any period unless full
cumulative dividends for all past
dividend periods and the then current
dividend period shall have been or
contemporaneously are (i) declared and paid
in cash or (ii) declared and a sum
sufficient for the payment thereof in cash
is set apart for such payment on the
Series A Preferred Units. When dividends
are not paid in full (or a sum
sufficient for such full payment is not so
set apart) upon the Series A
Preferred Units and the units of any other
series of preferred units ranking on
a parity as to dividends with the Series A
Preferred Units, all dividends
declared upon the Series A Preferred Units
and any other series of preferred
units ranking on a parity as to dividends
with the Series A Preferred Units
shall be declared pro rata so that the
amount of dividends declared per unit of
Series A Preferred Units and such other
series of preferred units shall in all
cases bear to each other the same ratio
that accrued dividends per share on the
Series A Preferred Units and such other
series of preferred units (which shall
not include any accrual in respect of
unpaid dividends on such other series of
preferred units for prior dividend periods
if such other series of preferred
units does not have a cumulative dividend)
bear to each other. No interest, or
sum
85
<PAGE>
of money in lieu of interest, shall be
payable in respect of any dividend
payment or payments on the Series A
Preferred Units which may be in arrears.
(e) Except as provided in paragraph 2(d), unless full
cumulative dividends on the Series A
Preferred Units shall have been or
contemporaneously are declared and paid in
cash or declared and a sum sufficient
for the payment thereof in cash is set
apart for payment for all past dividend
and the then current dividend period, no
dividends (other than in Common Units
or other units ranking junior to the Series
A Preferred Units as to dividends
and upon liquidation) shall be declared or
paid or set aside for payment or
other dividend shall be declared or made
upon the Common Units or any other
units of the Operating Partnership ranking
junior to or on parity with the
Series A Preferred Units as to dividends or
amounts upon liquidation nor shall
any units of Common Units, or any ether
units of capital stock of the Operating
Partnership ranking junior to or on a
parity with the Series A Preferred Units
as to dividends on upon liquidation, shall
be redeemed, purchased or otherwise
acquired for any consideration (or any
moneys be paid to or made available for a
sinking fund for the redemption of any such
units) by the Operating Partnership
except by conversion into or exchange for
other units of the Operating
Partnership ranking junior to the Series A
Preferred Units as to dividends and
upon liquidation). Nothing in the foregoing
shall be deemed to preclude the
exercise of Rights (as defined in the
Partnership Agreement) by any unit holder
in accordance with the Partnership
Agreement.
(f) Holders of units of Series A Preferred Units shall not be
entitled to any dividend, whether payable
in cash, Property or units, in excess
of full cumulative dividends on the Series
A Preferred Units as provided above.
Any dividend payment made on the Series A
Preferred Units shall first be
credited against the earliest accrued but
unpaid dividends due with respect to
such units which remains payable.
3.
Liquidation Rights.
Upon any voluntary or involuntary liquidation, dissolution or
winding-up of the affairs of the Operating
Partnership, the holders of units of
Series A Preferred Units shall be entitled
to be paid out of the assets of the
Operating Partnership legally available for
distribution to its Unit holders a
liquidation preference of $25.00 per unit,
plus an amount equal to any accrued
and unpaid dividends to the date of payment
(whether or not declared), before
any distribution or payment shall be made
to holders of share of Common Units or
any other class or series of Units of the
Operating Partnership ranking junior
to the Series A Preferred Units as to
liquidation rights. In the event that,
upon such voluntary or involuntary
liquidation, dissolution or winding-up the
available assets of the Operating
Partnership are insufficient to pay the amount
of the liquidating distributions on all
outstanding units of Series A Preferred
Units and the corresponding amounts payable
on all units of other classes or
series of units of the Operating
Partnership ranking on a parity with the Series
A Preferred Units in the distribution of
assets, then the holders of the Series
A Preferred Units and all other such
classes or series of units shall share
ratably in any such distribution of assets
in proportion to the full liquidating
distributions to which they would otherwise
he respectively entitled. Holders of
Series A Preferred Units shall be entitled
to written notice of any such
liquidation. After payment of the full
amount of the liquidating distributions
to which they are entitled, the holders of
Series A Preferred Units will have no
right or claim to any of the remaining
assets of the Operating Partnership. The
86
<PAGE>
consolidation or merger of the Operating
Partnership with or into any
corporation, trust or entity or of any
corporation, trust or other entity, or
the sale, lease or conveyance of all or
substantially all of the property or
business of the Operating Partnership shall
not be deemed to constitute a
liquidation, dissolution or winding-up of
the Operating Partnership.
4. Redemption.
(a) Series A Preferred Units shall not be redeemable prior to
July 1, 2003. On or after July 1, 2003; the
Operating Partnership, at its option
upon not less than 30 nor more than 60
days, written notice, may redeem the
Series A preferred Units, in whole or in
part, at any time or from time to time,
for cash at a redemption price of $25.00
per unit, plus all accrued and unpaid
dividends thereon to the date fixed for
redemption (except as provided below),
without interest. If fewer than all of the
outstanding units of Series A
Preferred Units are to be redeemed, the
units of Series A Preferred Units to be
redeemed shall be redeemed, pro rata (as
nearly as may be practicable without
creating fractional units) or by a lot or
by any other equitable method
determined by the Operating Partnership.
Holders of Series A Preferred Units to
be redeemed shall surrender such Series A
Preferred Units at the place
designated in such notice and shall be
entitled to the redemption price and any
accrued and unpaid dividends payable upon
such redemption following such
surrender. If notice of redemption of any
Series A Preferred Units has been
given and if the funds necessary for such
redemption have been set aside by the
Operating Partnership in trust for the
benefit of the holders of any units of
Series A Preferred Units so called for
redemption, then from and after the
redemption date dividends shall cease to
accrue on such Series A Preferred
Units, such units of Series A Preferred
Unites shall no longer be deemed
outstanding and all rights of the holders
of such units will terminate, except
the right to receive the redemption price
plus any accrued and unpaid dividends
payable upon such redemption.
(b) Unless full cumulative dividends on all Series A Preferred
Units shall have been or contemporaneously
are declared and paid in cash or
declared and a sum sufficient for the
payment thereof in cash set apart for
payment for all past dividend periods and
the then current dividend period, no
Series A Preferred Units shall be redeemed
unless all outstanding units of
Series A Preferred Units are simultaneously
redeemed and the Operating
Partnership shall not purchase or otherwise
acquire directly or indirectly any
units of Series A Preferred Units (except
by exchange for units of the Operating
Partnership ranking junior to the Series A
Preferred Units as to dividends and
amounts upon liquidation.
(c) Notice of redemption shall be mailed by the Operating
Partnership, postage prepaid, not less than
30 nor more than 60 days prior to
the redemption date, addressed to the
respective holders of record of the units
of Series A Preferred Units to be redeemed
at their respective addresses as they
appear on the records of the Operating
Partnership. No failure to give such
notice or any defect thereto or in the
mailing thereof shall affect the validity
of the proceedings for the redemption of
any Series A Preferred Units except as
to a holder to whom notice was defective or
not given. Each notice shall state
(i) the redemption date; (ii) the
redemption price; (iii) the number of units of
Series A Preferred Units to be redeemed;
(iv) the place or places where units of
Series A Preferred Units are to be
surrendered for payment of the redemption
price; and (v) that dividends on the Series
A Preferred Units to be redeemed
shall
87
<PAGE>
cease to accrue on such redemption date. If
fewer than all of the units of
Series A Preferred Units held by any holder
are to be redeemed, the notice
mailed to such holder shall also specify
the number of units of Series A
Preferred Units held by such holder to be
redeemed.
(d) Immediately prior to any redemption of Series A Preferred
Units,
the Operating Partnership shall pay, in
cash, any accumulated and unpaid
dividends through the redemption date,
unless a redemption date falls after a
Dividend Record Date and prior to the
corresponding Dividend Payment Date, in
which case each holder of Series A
Preferred at the close of business on such
Dividend Record Date shall be entitled to
the dividend payable on such units on
the corresponding Dividend Payment Date
notwithstanding the redemption of such
units before such Dividend Payment Date.
Except as provided above, the Operating
Partnership shall make no payment or
allowance for unpaid dividends, whether or
not in arrears, on Series A Preferred Units
for which a notice of redemption has
been given.
(e) All units of the Series A Preferred Units redeemed pursuant to
this
paragraph 4 shall be retired and shall be
restored to the status of authorized
and unissued units of preferred units,
without designation as to series and may
thereafter be reissued as units of any
series of preferred units.
(f) The Series A
Preferred Units shall have no stated maturity and
shall not be subject to any sinking fund or
mandatory redemption.
5. Voting Rights.
(a) Holders of the Series A Preferred Units shall not have any
voting rights, except as set forth in the
Partnership Agreement.
(b) So long as any units of Series A Preferred Units remain
outstanding, the Operating Partnership
shall not, without the affirmative vote
or consent of the holders of two-thirds of
the units of Series A Preferred Units
outstanding at the time, given in person or
by proxy, either in writing or at a
meeting (such series voting separately as a
class): (i) authorize or create, or
increase the authorized or issued amount
of, any class or series of units
ranking prior to the Series A Preferred
Units with respect to payment of
dividends or the distribution of assets
upon liquidation, dissolution or
winding-up of the Operating Partnership or
reclassify any authorized units of
the Operating Partnership into such units,
or create, authorize or issue any
obligation or security convertible into or
evidencing the right to purchase any
such units; or (ii) amend, alter or repeal
the provisions of the Partnership
Agreement or this Certificate of
Designations, whether by merger, consolidation
or otherwise (an "Event"), so as to
materially and adversely affect any right,
preference, privilege or voting power of
the Series A Preferred Units or the
holders thereof; provided however, with
respect to the occurrence of any of the
Events set forth in (ii) above, so long as
the Series A Preferred Units remains
outstanding with the terms thereof
materially unchanged, taking into account
that, upon the occurrence of an Event, the
Operating Partnership may not be the
surviving entity, the occurrence of such
Event shall not be deemed to materially
and adversely affect such rights,
preferences, privileges or voting power of
holders of Series A Preferred Units and
provided further that (A) any increase
in amount of the authorized Preferred Units
or the creation or issuance of any
other Series A
88
<PAGE>
Preferred Units or (B) any increase in the
number of authorized
units of Series A Preferred Units or any
other series of Preferred Units in each
case ranking on a parity with or junior to
the Series A Preferred Units of such
series with respect to the payment of
dividends or the distribution of assets
upon liquidation, dissolution or winding
up, shall not be deemed to materially
and adversely affect such rights,
preferences, privileges or voting powers.
(c) The foregoing voting provisions of this paragraph 5 shall not
apply
if, at or prior to the time when the act
with respect to which such vote would
otherwise be required shall be effected,
all outstanding units of Series A
Preferred Units shall have been redeemed or
called for redemption upon proper
notice and sufficient funds, in cash, shall
have been deposited in trust to
effect such redemption.
(d) In any matter in which the Series A Preferred Units may vote
(as
expressly provided herein or as may be
required by law), each share of Series A
Preferred Units shall be entitled to one
vote, except that when any other series
of preferred units of the Operating
Partnership shall have the right to vote
with the Series A Preferred Units as a
single class on any matter, the Series A
Preferred Units and such other series shall
have with respect to such matters
one vote per each $25.00 of stated
liquidation preference.
6. Conversion.
The units of Series A Preferred Units shall, with respect to
dividend
rights and rights upon liquidation,
dissolution or winding-up of the Operating
Partnership, rank (a) senior to the Common
Units and to all units ranking junior
to such Series A Preferred Units; (b) on a
parity with all units issued by the
Operating partnership the terms of which
specifically provide that such units
rank on a parity with the Series A
Preferred Units; and (c) junior to all units
issued by the Operating partnership (in
accordance with this Certificate of
Designations) the terms of which
specifically provide that such units rank
senior to the Series A Preferred Units. For
purposes of this paragraph 7, the
term "units" does not include indebtedness
convertible into units.
8. Exclusion of Other Rights.
The Series A Preferred Units shall not have any references or
other
rights, voting powers, restrictions,
limitations as to dividends or other
distributions, qualifications or terms or
conditions of redemption other than
expressly set forth in the Partnership
Agreement and this Certificate of
Designations.
9. Headings of Subdivisions.
The headings of the various subdivisions hereof are for convenience
of
reference only and shall not affect the
interpretation of any of the provisions
hereof.
10. Severability of Provisions.
If any preferences or other rights, voting powers,
restrictions,
limitations as to dividends
89
<PAGE>
or other distributions, qualifications or
terms or
conditions of redemption of the Series A
Preferred Units set forth in the
Partnership Agreement and this Certificate
of Designations is invalid, unlawful
or incapable of being enforced by reason of
any rule of law or public policy,
all other preferences or other rights,
voting powers, restrictions, limitations
as to distributions, qualifications or
terms or conditions of redemption of
Series A Preferred Units set forth in the
Partnership Agreement which can be
given effect without the invalid, unlawful
or unenforceable provision thereof
shall, nevertheless, remain in full force
and effect and no preferences or other
rights, voting powers, restrictions,
limitations as to dividends or other
distributions, qualifications or terms or
conditions of redemption of the Series
A Preferred Units herein set forth shall be
deemed dependent upon any other
provision thereof unless so expressed
therein.
11. No Preemptive Rights.
No holder of Series A Preferred Units shall be entitled to any
preemptive rights to subscribe for or
acquire any unissued units of the
Operating Partnership (whether now or
hereafter authorized) or securities of the
Operating Partnership convertible into or
carrying a right to subscribe to or
acquire units of the Operating
Partnership.
SIGNATURE APPEARS ON NEXT PAGE
90
<PAGE>
IN WITNESS WHEREOF, CBL Holdings I, Inc.
has caused this Certificate of
Designation of Series A Cumulative
Redeemable referred Units to be duly executed
by its Executive Vice President and Chief
Financial Officer this 30th day of
June, 1998.
CBL Holdings I, Inc.
By: /s/ John
N. Foy
--------------------------------
John N. Foy
Executive Vice President
And Chief Financial Officer
91
<PAGE>
CERTIFICATE OF DESIGNATION
OF
8.75% SERIES B CUMULATIVE REDEEMABLE PREFERRED UNITS
OF
CBL & ASSOCIATES LIMITED PARTNERSHIP
Pursuant to Article 4.4 of the
Second Amended and Restated Partnership Agreement of
CBL & Associates Limited Partnership
WHEREAS, CBL &
Associates Properties,
Inc. (the "Company")
has
issued 2,000,000 shares (the "Offering") of 8.75%
Series B Cumulative Redeemable Preferred
Stock (the "Preferred Stock");
WHEREAS, the Company and the Operating Partnership desire that
the
Company contribute net proceeds of the
Offering to CBL & Associates Limited
Partnership (the "Operating Partnership")
in exchange for preferred units having
substantially the same economic rights and
terms of the Preferred Stock;
WHEREAS, Article 4.4 of the Second Amended and Restated
Partnership
Agreement of the Operating Partnership (the
"Partnership Agreement") provides
for a Preferred Unit Designation, setting
forth, in sufficient detail, the
economic rights and terms of the class or
series of preferred units.
NOW, THEREFORE, CBL Holdings I, Inc., the general partner of
the
Operating Partnership (the "General
Partner") hereby designates a series of
preferred units and fixes the designations,
powers, preferences and relative,
participating, optional or other special
rights, and the qualifications,
limitations or restrictions thereof, of
such preferred units, as follows:
1. Designation and Amount.
The units of such series shall be designated "8.75% Series B
Cumulative
Redeemable Preferred Units" (the "Series B
Preferred Units") and the number of
units constituting such series shall be
2,000,000. The designations, powers,
preferences and relative, participating,
optional or other special rights, and
the qualifications, limitations or
restrictions thereof, of the Series B
Preferred Units shall be subject in all
cases to the provisions of the
Partnership Agreement.
2. Dividends and Distribution Rights.
(a) Holders of Series B Preferred Units shall be entitled to
receive,
when, as and if
92
<PAGE>
declared by the General Partner, out of
assets of the Operating
Partnership legally available for the
payment of dividends, cumulative
preferential cash dividends at the rate of
8.75% per annum of the $50.00
liquidation preference. Such dividends
shall be cumulative from the date of the
original issue by the Operating Partnership
of Series B Preferred Units and
shall be payable quarterly in arrears on
the 30th day of March, June, September,
and December of each year or, if not a
business day, the next succeeding
business day (each, a "Dividend Payment
Date"). The first dividend shall be paid
on June 30, 2002. Such first dividend and
any dividend payable on the Series B
Preferred Units for any partial dividend
period shall be computed on the basis
of a 360-day year consisting of twelve
30-day months. Dividends will be payable
to holders of record as they appear in the
records of the Operating Partnership
at the close of business on the applicable
record date, which shall be the 15th
day of the calendar month in which the
applicable Dividend Payment Date falls or
on such other date designated by the
General Partner for the payment of
dividends that is not more than 30 nor less
than 10 days prior to such Dividend
Payment Date (each, a "Dividend Record
Date").
(b) No dividends on the Series B Preferred Units shall be declared
by
the General Partner or paid or set apart
for payment by the General Partner at
such time as the terms and provisions of
any agreement of the Operating
Partnership, including any agreement
relating to its indebtedness, prohibits
such declaration, payment or setting apart
for payment or provides that such
declaration, payment or setting apart for
payment would constitute a breach
thereof or a default thereunder, or if such
declaration or payment shall be
restricted or prohibited by law.
(c) Notwithstanding anything contained herein to the contrary,
dividends on the Series B Preferred Units
shall accrue whether or not the
Operating Partnership has earnings, whether
or not there are funds legally
available for the payment of such
dividends, and whether or not such dividends
are declared. Accrued but unpaid dividends
on the Series B Preferred Units shall
accumulate as of the Dividend Payment Date
on which they first become payable.
(d) Except as set forth in the next sentence, no dividends shall
be
declared or paid or set apart for payment
on any of the Operating Partnership's
Common Units ("Common Units"), or units of
any other class or series of units of
the Operating Partnership ranking, as to
dividends, on a parity with or junior
to the Series B Preferred Units (other than
a dividend paid in units of Common
Units or in units of any other class or
series of units ranking junior to the
Series B Preferred Units as to dividends
and upon liquidation) for any period
unless full cumulative dividends on the
Series B Preferred Units for all past
dividend periods and the then current
dividend period shall have been or
contemporaneously are (i) declared and paid
in cash or (ii) declared and a sum
sufficient for the payment thereof in cash
is set apart for such payment. When
dividends are not paid in full (or a sum
sufficient for such full payment is not
so set apart) upon the Series B Preferred
Units and the units of any other
series of preferred units ranking on a
parity as to dividends with the Series B
Preferred Units, all dividends declared
upon the Series B Preferred Units and
any other series of preferred units ranking
on a parity as to dividends with the
Series B Preferred Units shall be declared
pro rata so that the amount of
dividends declared per unit of Series B
Preferred Units and such other series of
preferred units shall in all cases bear to
each other the same ratio that
accrued dividends per share on the Series B
Preferred Units and such other
series of preferred units (which shall not
include any accrual in respect of
unpaid dividends on such other series of
preferred units for prior dividend
periods if such other series of
93
<PAGE>
preferred units does not have a
cumulative
dividend) bear to each other. No interest,
or sum of money in lieu of interest,
shall be payable in respect of any dividend
payment or payments on the Series B
Preferred Units which may be in
arrears.
(e) Except as provided in paragraph 2(d), unless full
cumulative
dividends on Series B Preferred Units shall
have been or contemporaneously are
declared and paid in cash declared and a
sum sufficient for the payment thereof
in cash is set apart for payment for all
past dividend periods and the then
current dividend period, no dividends
(other than in Common Units or other units
ranking junior to the Series B Preferred
Units as to dividends and upon
liquidation) shall be declared or paid or
set aside for payment or other
dividend shall be declared or made upon the
Common Units or any other units of
the Operating Partnership ranking junior to
or on parity with the Series B
Preferred Units as to dividends or amounts
upon liquidation nor shall any units
of Common Units, or any other units of
capital stock of the Operating
Partnership ranking junior to or on a
parity with the Series B Preferred Units
as to dividends or upon liquidation, shall
be redeemed, purchased or otherwise
acquired for any consideration (or any
moneys be paid to or made available for a
sinking fund for the redemption of any such
units) by the Operating Partnership
(except by conversion into or exchange for
other units of the Operating
Partnership ranking junior to the Series B
Preferred Units as to dividends and
upon liquidation). Nothing in the foregoing
shall be deemed to preclude the
exercise of Rights (as defined in the
Partnership Agreement) by any unit holder
in accordance with the Partnership
Agreement.
(f) Holders of units of Series B Preferred Units shall not be
entitled
to any dividend, whether payable in cash,
property or units, in excess of full
cumulative dividends on the Series B
Preferred Units as provided above. Any
dividend payment made on the Series B
Preferred Units shall first be credited
against the earliest accrued but unpaid
dividends due with respect to such units
which remains payable.
3.
Liquidation Rights.
Upon any voluntary or involuntary liquidation, dissolution or
winding-up of the affairs of the Operating
Partnership, the holders of units of
Series B Preferred Units shall be entitled
to be paid out of the assets of the
Operating Partnership legally available for
distribution to its Unit holders a
liquidation preference of $50.00 per unit,
plus an amount equal to any accrued
and unpaid dividends to the date of payment
(whether or not declared), before
any d
