Exhibit 10.68
▇▇▇▇▇▇ RENEWAL LIMITED PARTNERSHIP
A DELAWARE LIMITED PARTNERSHIP
FIRST AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
DATED AS OF NOVEMBER 18, 1997
TABLE OF CONTENTS
SECTION 1: DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . .. 1
SECTION 2: CONTINUATION. . . . . . . . . . . . . . . . . . . . . . . . .. 28
Section 2.1 Continuation . . . . . . . . . . . . . . . . . . . . . .. 28
Section 2.2 Name and Office; Registered Agent and Office . . . . . .. 28
Section 2.3 Purpose. . . . . . . . . . . . . . . . . . . . . . . . .. 28
Section 2.4 Authorized Acts. . . . . . . . . . . . . . . . . . . . .. 28
Section 2.5 Term and Dissolution . . . . . . . . . . . . . . . . . .. 30
SECTION 3: ACQUISITION, FINANCING, REHABILITATION, AND DISPOSITION OF
PROPERTY. . . . . . . . . . . . . . . . . . . . . . . . . . .. 31
Section 3.1 Acquisition. . . . . . . . . . . . . . . . . . . . . . .. 31
Section 3.2 Financing. . . . . . . . . . . . . . . . . . . . . . . .. 31
Section 3.3 Rehabilitation . . . . . . . . . . . . . . . . . . . . .. 33
Section 3.4 Management and Disposition . . . . . . . . . . . . . . .. 33
SECTION 4: PARTNERS AND CAPITAL ACCOUNTS . . . . . . . . . . . . . . . .. 33
Section 4.1 General Partner. . . . . . . . . . . . . . . . . . . . .. 33
Section 4.2 Limited Partners . . . . . . . . . . . . . . . . . . . .. 34
Section 4.3 Partnership Capital and Capital Accounts . . . . . . . .. 34
Section 4.4 Withdrawal of Capital. . . . . . . . . . . . . . . . . .. 35
Section 4.5 Liability of Limited Partner . . . . . . . . . . . . . .. 36
Section 4.6 Additional Limited Partners. . . . . . . . . . . . . . .. 36
SECTION 5: CAPITAL CONTRIBUTIONS OF INVESTOR LIMITED PARTNER AND
SPECIAL LIMITED PARTNER; OPERATING DEFICIT LOANS; INVESTOR
LIMITED PARTNER LOANS; LETTER OF CREDIT; REPURCHASE RIGHT . .. 36
Section 5.1 Capital Contributions of Investor Limited Partner and
Special Limited Partner. . . . . . . . . . . . . . . . .. 36
Section 5.2 Conditions to Payment of Second Installment. . . . . . .. 38
Section 5.3 Adjuster Provisions: Generally; Completion Adjuster. . .. 40
Section 5.4 Historic Rehabilitation Credit Adjuster. . . . . . . . .. 41
Section 5.5 Balloon Adjuster . . . . . . . . . . . . . . . . . . . .. 43
Section 5.6 IRS Claims . . . . . . . . . . . . . . . . . . . . . . .. 43
Section 5.7 Project Cost Overruns. . . . . . . . . . . . . . . . . .. 44
Section 5.8 Operating Deficits and Operating Deficit Loans; Use of
Operating Deficit Reserve; and Cash Collateral Fund. . .. 44
Section 5.9 No Third-Party Rights in Operating Deficit Loans . . . .. 45
Section 5.10 No Third-Party Rights in Capital . . . . . . . . . . . .. 46
Section 5.11 Letters of Credit. . . . . . . . . . . . . . . . . . . .. 46
Section 5.12 Limited Partners' Right to Require Repurchase. . . . . .. 46
Section 5.13 Repayment to Investor Limited Partner of Excess
Adjustment . . . . . . . . . . . . . . . . . . . . . . .. 47
Section 5.14 Subordinated Partner Loans.. . . . . . . . . . . . . . .. 48
Section 5.16 Negative Capital Account Restoration.. . . . . . . . . .. 50
Section 5.17 Bridge Loan. . . . . . . . . . . . . . . . . . . . . . .. 51
SECTION 6: PROFITS AND LOSSES; CREDITS; DISTRIBUTIONS. . . . . . . . . .. 51
Section 6.1 Profits and Losses . . . . . . . . . . . . . . . . . . .. 51
Section 6.2 Distributions Prior to Dissolution . . . . . . . . . . .. 52
A. Distribution of Cash Flow. . . . . . . . . . . . . . . .. 52
B. Distributions of Refinancing Proceeds. . . . . . . . . .. 53
C. Distributions of Sale Proceeds . . . . . . . . . . . . .. 54
Section 6.3 Liquidation. . . . . . . . . . . . . . . . . . . . . . .. 56
Section 6.4 Special Distribution Provisions. . . . . . . . . . . . .. 56
Section 6.5 Special Allocation Provisions. . . . . . . . . . . . . .. 57
Section 6.6 Order of Application . . . . . . . . . . . . . . . . . .. 60
SECTION 7: RIGHTS, POWERS AND DUTIES OF GENERAL PARTNER. . . . . . . . .. 61
Section 7.1 Restrictions on Authority. . . . . . . . . . . . . . . .. 61
Section 7.2 Personal Services and Competition. . . . . . . . . . . .. 62
Section 7.3 Business Management and Control; Designation of
Managing General Partner . . . . . . . . . . . . . . . .. 63
Section 7.4 Duties and Obligations of General Partner. . . . . . . .. 64
Section 7.5 Certain Payments to the Developer and Developer's
Affiliates . . . . . . . . . . . . . . . . . . . . . . .. 68
Section 7.6 Fiduciary Duty of General Partner. . . . . . . . . . . .. 69
Section 7.7 Indemnification. . . . . . . . . . . . . . . . . . . . .. 69
Section 7.8 Liability of General Partner to Limited Partners . . . .. 70
Section 7.9 Tax Matters Partner. . . . . . . . . . . . . . . . . . .. 70
Section 7.10 Access and Reports . . . . . . . . . . . . . . . . . . .. 72
Section 7.11 Representations and Warranties of General Partner. . . .. 72
Section 7.12 Indemnification. . . . . . . . . . . . . . . . . . . . .. 75
SECTION 8: REMOVAL OF GENERAL PARTNER. . . . . . . . . . . . . . . . . .. 76
Section 8.1 General. . . . . . . . . . . . . . . . . . . . . . . . .. 76
Section 8.2 Set Off. . . . . . . . . . . . . . . . . . . . . . . . .. 76
Section 8.3 Removal of General Partner . . . . . . . . . . . . . . .. 76
SECTION 9: BOOKS AND REPORTING, ACCOUNTING, TAX ELECTIONS, ETC.. . . . .. 79
Section 9.1 Books and Reporting. . . . . . . . . . . . . . . . . . .. 79
Section 9.2 Bank Accounts. . . . . . . . . . . . . . . . . . . . . .. 81
Section 9.3 Tax Elections. . . . . . . . . . . . . . . . . . . . . .. 82
Section 9.4 Special Adjustments. . . . . . . . . . . . . . . . . . .. 82
Section 9.5 Fiscal Year. . . . . . . . . . . . . . . . . . . . . . .. 82
SECTION 10: WITHDRAWAL OF A GENERAL PARTNER; NEW GENERAL PARTNERS . . . .. 82
Section 10.1 Voluntary Withdrawal . . . . . . . . . . . . . . . . . .. 82
Section 10.2 Obligation to Continue . . . . . . . . . . . . . . . . .. 83
Section 10.3 Successor General Partner. . . . . . . . . . . . . . . .. 83
Section 10.4 Interest of Predecessor General Partner. . . . . . . . .. 84
Section 10.5 Designation of New General Partners. . . . . . . . . . .. 85
Section 10.6 Amendment of Agreement; Approval of Certain Events . . .. 86
Section 10.7 Admission of a General Partner . . . . . . . . . . . . .. 86
SECTION 11: TRANSFER OF LIMITED PARTNERSHIP INTERESTS . . . . . . . . . .. 86
Section 11.1 Right to Assign. . . . . . . . . . . . . . . . . . . . .. 86
Section 11.2 Restrictions . . . . . . . . . . . . . . . . . . . . . .. 86
Section 11.3 Substitute Limited Partners. . . . . . . . . . . . . . .. 87
Section 11.4 Assignees. . . . . . . . . . . . . . . . . . . . . . . .. 87
SECTION 12: MANAGEMENT AGREEMENT. . . . . . . . . . . . . . . . . . . . .. 89
Section 12.1 General. . . . . . . . . . . . . . . . . . . . . . . . .. 89
Section 12.2 Management Fee Paid to General Partner and an Affiliate.. 89
SECTION 13: GENERAL PROVISIONS. . . . . . . . . . . . . . . . . . . . . .. 89
Section 13.1 Restrictions on Transfer . . . . . . . . . . . . . . . .. 89
Section 13.2 Notices. . . . . . . . . . . . . . . . . . . . . . . . .. 89
Section 13.3 Word Meanings. . . . . . . . . . . . . . . . . . . . . .. 90
Section 13.4 Binding Provisions . . . . . . . . . . . . . . . . . . .. 90
Section 13.5 Applicable Law . . . . . . . . . . . . . . . . . . . . .. 90
Section 13.6 Exhibits and Schedules . . . . . . . . . . . . . . . . .. 90
Section 13.7 Counterparts . . . . . . . . . . . . . . . . . . . . . .. 91
Section 13.8 Paragraph Titles . . . . . . . . . . . . . . . . . . . .. 91
Section 13.9 Separability of Provisions . . . . . . . . . . . . . . .. 91
Section 13.10 Effective Date of Admission. . . . . . . . . . . . . . .. 91
Section 13.11 Amendment Procedure. . . . . . . . . . . . . . . . . . .. 91
FIRST AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
OF
▇▇▇▇▇▇ RENEWAL LIMITED PARTNERSHIP
FIRST AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT (this
"Agreement") is made as of the 18th day of November, 1997, by and among HRI
▇▇▇▇▇▇ CORPORATION, a Louisiana corporation, as General Partner; A. ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇., a resident of ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Louisiana, as Withdrawing Limited
Partner; AMERUS-BLACKSTONE, L.L.C., an Iowa limited liability company, as
Investor Limited Partner; and AMERUS MANAGEMENT, INC., an Iowa corporation, as
Special Limited Partner (General Partner, Investor Limited Partner, and Special
Limited Partner are hereinafter collectively referred to as the "Partners").
Recitals:
▇▇▇▇▇▇ Renewal Limited Partnership (the "Partnership") was organized as a
limited partnership pursuant to Articles of Limited Partnership dated as of July
31, 1997 (the "Original Agreement"), and formed under the laws of the State of
Delaware pursuant to a "Certificate of Limited Partnership of ▇▇▇▇▇▇ Renewal
Limited Partnership" recorded with the Secretary of State of the State of
Delaware (the "Filing Office") on August 1, 1997.
The purposes of this amendment and restatement to the Original Agreement
are to (i) provide for the withdrawal of the Withdrawing Limited Partner as the
original limited partner, (ii) provide for the admission of Amerus-Blackstone,
L.L.C. as Investor Limited Partner and AmerUs Management, Inc. as Special
Limited Partner, (iii) set forth more fully the rights, obligations and duties
of General Partner, Investor Limited Partner, and Special Limited Partner, and
(iv) amend, restate and supersede the Original Agreement in its entirety.
NOW, THEREFORE, it is hereby agreed as follows:
SECTION 1: DEFINITIONS
The capitalized terms used in this Agreement shall have the meanings
ascribed to them in this Section 1.
"Accountants." ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ of Bethesda, Maryland, or such
other firm of certified public accountants as may be engaged by General Partner
in accordance with the provisions of Section 9.1H.
"Act." The Delaware Revised Uniform Limited Partnership Act, Del. Code
▇▇▇. tit. 6, Section17-101 to 17-1109, as amended.
"Adjusted Capital Account Deficit." With respect to any Partner, the
deficit balance, if any, in such Partner's Capital Account as of the end of a
Partnership Fiscal Year, after giving effect to the following adjustments:
(i) Such Capital Account shall be increased by the amount of any
Deficit Restoration Obligation of such Partner.
(ii) Such Capital Account shall be decreased by the items
described in Sections 1.704-1(b)(2)(ii)(d)(4), (5), and (6) of the
Allocation Regulations.
The foregoing definition of Adjusted Capital Account Deficit and the
application of such term in the manner provided in Section 6.5E are intended to
comply with the provisions of Section 1.704-1(b)(2)(ii)(d) of the Allocation
Regulations and shall be interpreted consistently therewith.
"Admission Date." The date on which this Agreement is executed, all of the
Admission Date Conditions have been satisfied, and Investor Limited Partner and
Special Limited Partner are admitted to the Partnership.
"Admission Date Conditions." The matters listed on Exhibit A attached to
this Agreement.
"Adverse Consequences." All actions, suits, proceedings, hearings,
investigations, charges, complaints, claims, demands, injunctions, judgments,
orders, decrees, rulings, damages, dues, penalties, fines, costs, reasonable
amounts paid in settlement, liabilities, obligations, taxes, liens, losses,
expenses and fees, including court costs and reasonable attorneys' fees and
expenses.
"Affiliate." With respect to a specified Person, (i) any Person directly
or indirectly controlling, controlled by or under common control with the Person
specified, (ii) any Person owning or controlling 10% or more of the outstanding
voting securities or beneficial interests of the Person specified, (iii) any
officer, director, partner, trustee or member of the immediate family of the
Person specified, (iv) if the Person specified is an officer, director, general
partner or trustee, any corporation, partnership or trust for which that Person
acts in that capacity then such corporation, partnership or trust, or (v) any
Person who is an officer, director, general partner, trustee or holder of 10% or
more of outstanding voting securities or beneficial interests of any Person
described in clauses (i) through (iv). The term "control" (including the terms
"controlled by" and "under common control with") means the possession, direct or
indirect, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities, by
contract or otherwise.
"Agreement." This First Amended and Restated Limited Partnership
Agreement.
"Allocation Regulations." The Treasury Regulations issued under Sections
704(b) and 752 of the Code, as the same may be modified or amended from time to
time.
"Assignee." A Person who has acquired from a Partner, in accordance with
the terms of this Agreement, a beneficial interest in the Partnership's Profits,
Losses, Tax Credits or Distributions, but who is not a Substitute Partner.
"Assignment of Construction Agreement, Plans and Property Agreements." The
"Assignment" dated November 18, 1997 of certain of the Project Documents by the
Partnership in favor of the Lender as collateral security for the Mortgage Loan.
"Assignment of Redevelopment Agreement." That certain "Assignment" dated
November 18, 1997 of the Redevelopment Agreement by HRI in favor of the
Partnership.
"Assignment of Interior Design Agreement." That certain "Assignment" dated
November 18, 1997 of the Interior Design Agreement by HRI in favor of the
Partnership.
"Assignment of Purchase Agreement." That certain Assignment of the
Purchase Agreement dated November 18, 1997 by and between HRI and the
Partnership, whereunder HRI has assigned all of its right, title, and interest
in and to the Purchase Agreement to the Partnership.
"Bank." The First National Bank of Omaha or its successors and assigns as
holders of the TIF Advance Note.
"Base Management Fee." The base management fee payable to the Manager
pursuant to the Management Agreement.
"Best Knowledge." In the case of a specified Person, (i) actual knowledge
or (ii) that knowledge which a prudent business person (including, in the case
of an Entity, the general or managing partners, officers, directors, members and
key employees of such Entity) should have obtained in the management of such
person's business affairs after making due inquiry and exercising due diligence
with respect thereto. In connection therewith, the knowledge (both actual and
constructive) of any general or managing partner, director, officer or key
employee of an Entity shall be deemed to be the knowledge of the Entity.
"▇▇▇▇ of Sale." The ▇▇▇▇ of sale to be executed by Seller in favor of the
Partnership pursuant to which the Partnership will acquire the Personal
Property.
"Bridge Loan." Defined in Section 5.17.
"Building Loan Agreement." The loan agreement to be executed by and
between the Lender and the Partnership.
"Capital Account." An individual capital account maintained for each
Partner in accordance with the provisions of Section 4.
"Capital Contribution." The total amount of cash and the Gross Asset Value
of any property contributed or agreed to be contributed to the Partnership by
each Partner pursuant to the terms of this Agreement (minus any liabilities
secured by such contributed property that the Partnership assumes or takes
subject to). Any reference in this Agreement to the Capital Contribution of a
then Partner shall include a Capital Contribution previously made by any
predecessor-in-interest in respect to the Partnership Interest held by such then
Partner.
"Capital Proceeds." The proceeds of a Capital Transaction.
"Capital Transaction." Any transaction the proceeds of which are not
includable in determining Cash Flow, including, without limitation, Sale
Proceeds and Refinancing Proceeds, net insurance recoveries (other than proceeds
from rental interruption insurance), and title insurance recoveries, but
excluding (i) loans to the Partnership (other than a refinancing of the Mortgage
Loan) and (ii) Capital Contributions.
"Cash Collateral Fund." The fund in the initial amount of $200,000.00, to
be created by General Partner, from funds of General Partner, simultaneously
with payment of the Second Installment, which is to be used to fund Operating
Deficits. The Cash Collateral Fund shall be held jointly in the name of the
General Partner and Special Limited Partner and in interest- bearing accounts
which are fully insured by the Federal Deposit Insurance Corporation, or in such
other investments as Special Limited Partner may approve. Interest earned on
such funds will be earned in the name of General Partner and will be retained in
the Cash Collateral Fund and will be used for the same purposes as other funds
held in the Cash Collateral Fund. General Partner and Special Limited Partner
shall be joint signatories on the accounts in which the Cash Collateral Funds
are held; provided, however, that Special Limited Partner shall have the right
to withdraw funds from such accounts without the joinder of the General Partner
in the event the Special Limited Partner determines that the General Partner has
failed to take action to withdraw funds therefrom when General Partner is
required to do so under this Agreement. General Partner shall have the right to
withdraw any funds remaining in the accounts in which the Cash Collateral Fund
is held upon the earlier of (i) the expiration of the Initial Operating Period,
or (ii) the delivery of a letter of credit in the amount of the then outstanding
balance of the Cash Collateral Fund (the initial amount of $200,000.00 as
adjusted for any additions thereto or withdrawals therefrom), in form and
substance satisfactory to the Special Limited Partner in its sole discretion, by
the General Partner in favor of the Partnership; provided, however, that, in the
event such letter of credit is so issued, such letter of credit shall be drawn
upon, in whole or in part, to the same extent and as such times as if such drawn
funds were held in the Cash Collateral Fund and the amount thereof shall be
increased from time to time to the extent the General Partner would be required
to restore amounts to the Cash Collateral Fund pursuant to Section 5.8A.(iii).
Any such draw on the letter of credit shall be deemed, for all purposes of this
Agreement, as a withdrawal from the Cash Collateral Fund, and the Cash
Collateral Fund shall not be deemed to have been fully disbursed unless and
until the aggregate draws under such letter of credit equal the sum of
$200,000.00 less the aggregate amount the General Partner is required to restore
to the Cash Collateral Fund pursuant to Section 5.8A(iii).
"Cash Flow." Cash Receipts less payment of the (i) Project Expenses, (ii)
Debt Service, (iii) Debt Service Deficiency Loan, and (iv) Incentive Hotel
Management Fee for the applicable period of time.
"Cash Receipts." All gross receipts by the Partnership, including, Net
Hotel Revenues, Net Commercial Space Lease Rent, net insurance recoveries from
business interruption insurance, the net reduction in any Fiscal Year in the
amount of any escrow account or Partnership Reserves maintained by or for the
Partnership which is caused by withdrawal from such escrow account or
Partnership Reserve(s) made in accordance with the terms of this Agreement and,
to the extent not otherwise included in the determination of Cash Receipts, any
receipts of debt service or proceeds under the Redevelopment Note and any
receipts from the operation of the Parking Facility and/or the Off-Site Parking
Facility; provided, however, Cash Receipts shall not include Capital Proceeds.
"Certificate of Occupancy." The final, permanent certificate of occupancy
issued by the appropriate Governmental Authority authorizing the use and
occupancy of the entire Project as the Hotel, Parking Facility, Off-Site Parking
Facility and Commercial Space in accordance with the Plans and Specifications,
as contemplated by this Agreement; provided, however, that, in the event that
(i) the tenant improvements on the portion of the Project shown as the
approximate 7,600 square feet of commercial space located on the ground floor of
the Hospe Building in the Plans and Specifications are not completed prior to
the issuance of the final, permanent certificate of occupancy by the Governmen-
tal Authority with respect to the remaining portion of the Project, and (ii) the
General Partner is unable to finish out such premises or find, in the exercise
of due diligence and subject to the Consent of the Special Limited Partner, a
suitable tenant to complete such improvements and operate such premises prior to
such time the permanent certificate of occupancy with respect to the remaining
portion of the Project is issued by the Governmental Authority, then the
issuance of the final, permanent certificate of occupancy issued by the
appropriate Governmental Authority authorizing the use and occupancy of the
remaining portion of the Project as the Hotel, Off-Site Parking Facility and
Parking Facility in accordance with the Plans and Specifications, as
contemplated by this Agreement shall constitute the final, permanent certificate
of occupancy for purposes of this Agreement.
"City." The City of Omaha, a Nebraska municipal corporation.
"City Leases." Those certain "Lease Agreement(s)" for Lease No. 25368 and
for the lease to be executed after the Rehabilitation by and between the City
and the Partnership relating to those portions of the Project (shown as the
existing loading dock and the proposed loading dock on the western facade of the
Hospe Building on the Plans and Specifications) located and encroaching on City
property.
"City Lease Bond". The "Lease on Use of Public Property Bond(s)" executed
by the Partnership in favor of the City wherein the Partnership posts a
$10,000.00 bond for each of the City Leases to secure the Partnership's
obligations under the City Leases.
"Claim." Is defined in Section 5.6A.
"Claim Notice." Is defined in Section 5.6A.
"Code." The Internal Revenue Code of 1986, as amended, and the treasury
regulations promulgated thereunder, and any published public rulings, procedures
and notices thereunder.
"Commercial Space." The retail commercial space consisting of
approximately 7,600 square feet to be located on the ground floor of the Hospe
Building portion of the Improvements after the Rehabilitation.
"Commercial Space Expenses." Expenses payable by the Partnership related
to the Commercial Space Lease.
"Commercial Space Lease." The lease agreement, and any amendment thereto,
relating to the Commercial Space, the form and substance of which lease
agreement and the tenant thereunder shall be subject to Consent of the Special
Limited Partner.
"Commercial Space Lease Rent." Rent payable to the Partnership under the
Commercial Space Lease. If the Off-Site Parking Facility is operated by the
tenant(s) or its Affiliate under the Commercial Space Lease, "Commercial Space
Lease Rent" includes revenue from the Off-Site Parking Facility as well as from
the Commercial Space.
"Completion Date." June 30, 1999, unless such date has been extended by
Events of Force Majeure.
"Consent of Special Limited Partner." The prior written consent or
approval of Special Limited Partner. The approval of Special Limited Partner to
the form of the Project Documents, the approval of Special Limited Partner to
the Development Budget and the approval of the Special Limited Partner to the
Transfer of all or any portion of the General Partner's Partnership Interest and
the admission of any additional or successor General Partner may be withheld in
Special Limited Partner's sole and absolute discretion. Except as set forth
above and elsewhere in this Agreement, where this Agreement requires the prior
written consent or approval of Special Limited Partner, such consent or approval
shall not be unreasonably withheld or delayed.
"Construction and Design Contract." The "Standard Form of Agreement
between Owner and Design/Builder (Parts 1 and 2)" dated October 21, 1997,
effective November 13, 1997 by and between the Partnership and the Contractor,
in the form which has been approved by Special Limited Partner.
"Construction Consulting and Management Fee." A fee in the amount of
$75,000.00 to be paid to Investor Limited Partner at the Mortgage Loan Closing
for the performance of hotel feasibility studies and for the review and analysis
of the Management Agreement and Plans and Specifications.
"Contractor." HCI.
"County." ▇▇▇▇▇▇▇ County, Nebraska.
"Debt Service." The monthly installment or, if then due, any balloon
payment, of accrued interest and repayment of principal (including any
penalties, fees or expenses attributable thereto and/or the pay down of the
Mortgage Loan in connection with the exercise of the Mortgage Loan Extension
Privilege) which the Partnership is obligated to make to Lender under the Deed
of Trust Note, the Gap Note and/or to the Bank under the TIF Advance Note.
"Debt Service Coverage Loan." Defined in Section 3.2E.
"Debt Service Deficiency Loan." A loan made by the Manager to the
Partnership pursuant to Section 3.02A of the Management Agreement, such loan to
be used by the Partnership to pay Debt Service; provided, however, that any
decision to cause the Partnership to incur a Debt Service Deficiency Loan in an
amount that is less than $20,000.00 shall be made by the General Partner only
with the Consent of the Special Limited Partner.
"Deed." The special warranty deed to be executed by Seller in favor of the
Partnership pursuant to which the Partnership will acquire title to the Real
Property.
"Deed of Trust." The "First Deed of Trust, Assignment of Leases and
Profits, Security Agreement and Fixture Filing" granted by the Partnership to
the Lender to secure the obligations evidenced by the Deed of Trust Note.
"Deed of Trust Note." The promissory note in the amount of $14,175,000.00
made by the Partnership in favor of the Lender representing the Partnership's
indebtedness to the Lender pursuant to the Building Loan Agreement.
"Deficit Restoration Obligation." For each Partner, the sum of (i) any
amounts which such Partner is obligated to restore to the Partnership in
accordance with the provisions of Sections 1.704-1(b)(2)(ii)(c),
1.704-1(b)(2)(ii)(h) or any other applicable provisions of the Allocation
Regulations, (ii) such Partner's Share of Partnership Minimum Gain, if any,
(iii) such Partner's Share of Partner Nonrecourse Debt Minimum Gain, if any, and
(iv) any amounts which such Partner is obligated to restore to the Partnership
under Section 5.16 of this Agreement.
"Depreciation." For the Fiscal Year or other period, an amount equal to
the depreciation, amortization, or other cost recovery deduction allowable with
respect to an asset for such Fiscal Year or other period, except that if the
Gross Asset Value of an asset differs from the adjusted basis of such asset for
federal income tax purposes at the beginning of such Fiscal Year or other
period, Depreciation shall be an amount which bears the same ratio to such
beginning Gross Asset Value as the federal income tax depreciation,
amortization, or other cost recovery deduction for such Fiscal Year or other
period bears to such beginning adjusted tax basis.
"Designated Net Worth Standard. As of the date of determination, such
standards or criteria (relating to net worth or other characteristics) as may be
(i) set forth in Revenue Procedure 89-12 or any other regulations, memoranda,
published ruling or revenue procedure of the IRS for classification of the
Partnership for federal income tax purposes as a partnership rather than an
association taxable as a corporation, or (ii) sufficient to support the issuance
by Special Counsel of an opinion to the same effect.
"Designated Interest Rate." 8% per annum.
"Developer." HRI.
"Development Agreement." The Development Agreement to be executed by and
between the Developer and the Partnership, in the form which has been approved
by Special Limited Partner.
"Development Budget." The development budget for the Project which budget
has been prepared by the Developer, approved by General Partner and Special
Limited Partner, and attached to the Development Agreement as Exhibit B.
"Development Fee." The development fee payable to the Developer pursuant
to the terms of the Development Agreement.
"Development Fee Note." The promissory note executed by the Partnership,
payable to Developer, in the form which has been approved by Special Limited
Partner and attached to the Development Agreement as Exhibit A, evidencing the
Partnership's obligation to pay the deferred portion of the Development Fee
pursuant to the terms of the Development Agreement.
"Development Fee Note Assignment." The assignment and pledge agreement of
the Development Fee Note, in the form which has been approved by Special Limited
Partner, made by the Developer in favor of Special Limited Partner and Investor
Limited Partner pursuant to which the Developer pledges the Development Fee Note
to Special Limited Partner and Investor Limited Partner to secure, among other
things, the Developer's obligations under the Development Agreement, the
Development Guarantors' obligations under the Development Guaranty Agreement,
and the General Partner's obligation under Section 5.11.
"Development Guarantors." Pres Kabacoff and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇.
"Development Guaranty Agreement." The guaranty agreement to be executed by
the Development Guarantors in favor of the Partnership, in the form which has
been approved by Special Limited Partner, guaranteeing the obligations of the
Developer under the Development Agreement and the obligation of General Partner
to make payments relating to construction cost overruns pursuant to Section 5.7,
to make payments relating to the Completion Adjuster pursuant to Section 5.3B,
and to make reimbursement payments pursuant to Section 5.11.
"Distribution." Any cash or property which the Partnership distributes to
a Partner (in such Person's capacity as a Partner) without consideration,
including, without limitation, distributions of Cash Flow and Capital Proceeds.
"Entity." Any general partnership, limited partnership, corporation, joint
venture, trust, limited liability company, business trust, cooperative or
association.
"Environmental Indemnity Agreement." The environmental indemnity agreement
to be executed by and between the Lender and the Partnership and HRI-▇▇▇▇▇▇.
"Event of Bankruptcy" or "Bankruptcy. As to a specified Person:
(a) the entry of a decree or order for relief by a court
asserting jurisdiction in the premises in respect of such Person in
any case under the federal bankruptcy laws, as now or hereafter
constituted, or any other applicable federal or state bankruptcy,
insolvency or other similar law, or appointing a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of
such Person or for any substantial part of such Person's property, or
ordering the winding-up or liquidation of such Person's affairs; or
(b) the commencement by such Person of a voluntary case under the
federal bankruptcy laws, as now constituted or hereafter amended, or
any other applicable federal or state bankruptcy, insolvency or other
similar law, or the consent by such Person to the appointment of or
taking possession by a receiver, liquidator, assignee, trustee,
custodian, sequestrator (or similar official) of such Person or for
any substantial part of such Person's property, or the making by such
Person of any assignment for the benefit of creditors, or the taking
of action by such Person in furtherance of any of the foregoing; or
(c) the commencement against such Person of an involuntary case
under the federal bankruptcy laws, as now constituted or hereafter
amended, or any other applicable federal or state bankruptcy,
insolvency or other similar law, which has not been dismissed within
60 days.
"Event of Force Majeure" or "Force Majeure." Any of the following events
or occurrences: strike; lockout; action of labor unions; riots; hurricane;
storm; flood; explosion; acts of God or of the public enemy; acts of government,
war, invasion, insurrection, mob, violence, sabotage, or malicious mischief;
inability (notwithstanding good faith and diligent efforts) to procure, or
general shortage of labor, equipment, facilities, materials or supplies in the
open market; failure of transportation; fires; epidemics; quarantine
restrictions; freight embargoes; unusually severe weather; inability
(notwithstanding good faith and diligent efforts) to obtain governmental permits
or approvals or delays of subcontractors of General Partner, Developer, or
Contractor due to such causes, or any other similar event or occurrence which
prevents, interrupts, or delays the performance of an obligation on the part of
General Partner, Developer, or Contractor and which is beyond the reasonable
control of the party in question, provided, however, any of the foregoing which
is caused by the lack of funds of the Person claiming an Event of Force Majeure
shall not constitute an Event of Force Majeure.
"Excess Adjustment." Means the amount by which any Negative Historic
Adjustment exceeds the amount (if any) of Investor Limited Partner's unpaid
Capital Contribution as of the date on which such Negative Historic Adjustment
is determined, as described in Section 5.4. Excess Adjustment will be repaid to
Investor Limited Partner in accordance with Section 5.13.
"Excess Adjustment Loan(s)." A loan(s) made by General Partner to the
Partnership to fund Excess Adjustments pursuant to Section 5.13. Such loans,
which shall bear interest at an annual rate equal to the Designated Interest
Rate, shall be evidenced by unsecured, nontransferable promissory notes of the
Partnership. Such loans shall be repaid only as provided in Section 6, and no
recourse for the payment hereof may be had against any other property of the
Partnership or against any Partner. Payments of principal and interest on
Excess Adjustment Loans shall be applied in the same order in which such Excess
Adjustment Loans are made (i.e., on a first-in, first-out basis).
"Excess Expenses." Is defined in Section 6.5H.
"Exhibits." Is defined in Section 13.6A.
"Filing Office." The Office of the Secretary of State of the State.
"Final Determination." The earliest to occur of (i) the date on which a
decision, judgment, decree or other order has been issued by any court of
competent jurisdiction, which decision, judgment, decree or other order has
become final (i.e., all allowable appeals requested by the parties to the action
have been exhausted), (ii) the date on which the IRS has entered into a binding
agreement with the Partnership with respect to such issue, in accordance with
this Agreement, or on which the IRS has reached a final administrative or
judicial determination with respect to such issue which, whether by law or
agreement, is not subject to appeal, (iii) the date on which the time for
instituting a claim for refund has expired, or if a claim was filed the time for
instituting suit with respect thereto has expired with no such suit having been
filed provided that such expired time period absolutely precludes any suit with
respect to such claim from being filed, or (iv) the date on which the applicable
statute of limitations for raising an issue regarding a federal income tax
matter with respect to the Partnership has expired with such issue not having
been raised.
"Fiscal Year." The twelve-month period which begins on the first day of
January and ends on the 31st day of December of each calendar year (or ends on
the date of final dissolution for the year in which the Partnership is wound up
and dissolved).
"First Installment." Is defined in Section 5.1A.
"GAAP." Generally accepted accounting principles, consistently applied, as
in effect from time to time.
"Gap Deed of Trust." The "Second Deed of Trust, Assignment of Leases and
Profits, Security Agreement and Fixture Filing" granted by the Partnership to
the Lender to secure the obligations evidenced by the Gap Note.
"Gap Loan." The loan to be made by the Lender to the Partnership evidenced
by the Gap Note and secured by the Gap Deed of Trust which is made to provide
short-term financing for the acquisition and Rehabilitation of the Project.
"Gap Loan Documents." The Gap Note, Gap Deed of Trust and any other
document required by Lender in connection with the Gap Loan.
"Gap Loan Closing." The date on which the Gap Loan Documents become
effective between the Lender and the Partnership.
"Gap Note." The promissory note in the amount of $2,064,000.00 made by the
Partnership in favor of the Lender representing the Partnership's indebtedness
to the Lender pursuant to the Gap Loan.
"General Partner." HRI-▇▇▇▇▇▇ and any other General Partner appointed or
admitted in accordance with the terms of this Agreement, including Special
Limited Partner if Special Limited Partner becomes General Partner as provided
in this Agreement. If at any time the Partnership has more than one General
Partner, the term "General Partner" shall mean and include all General Partners.
"General Partner Pledge." The assignment and pledge agreement of General
Partner, in the form which has been approved by Special Limited Partner, made by
General Partner in favor of Investor Limited Partner or an Affiliate of Investor
Limited Partner as designated by Investor Limited Partner, pursuant to which
General Partner pledges all of General Partner's rights and interests under the
Partnership Agreement, including, but not limited to, all of General Partner's
Partnership Interest, to Investor Limited Partner or to such Affiliate to secure
General Partner's obligations under Sections 5.11, 5.12, 5.13 and 5.14.
"Governmental Authority." The State, the County, the City, or any other
federal, state or local governmental agency, instrumentality or authority
asserting jurisdiction over the particular matter to which reference is being
made.
"Gross Asset Value." With respect to any asset, the adjusted basis of such
asset for federal income tax purposes, except as follows:
(i) The initial Gross Asset Value of any asset contributed by a
Partner to the Partnership shall be the gross fair market value of such
asset, as determined by the contributing Partner and the Partnership and as
approved by Special Limited Partner;
(ii) The Gross Asset Values of all Partnership assets shall be
adjusted to equal their respective gross fair market values, as determined
by General Partner with the approval of Special Limited Partner, as of the
following times: (a) the acquisition of an additional interest in the
Partnership by any new or existing Partner in exchange for more than a de
minimis Capital Contribution; (b) the distribution by the Partnership to a
Partner of more than a de minimis amount of Partnership property as
consideration for an interest in the Partnership; and (c) the liquidation
of the Partnership within the meaning of Section 1.704-1(b)(2)(ii)(g) of
the Allocation Regulations; provided, however, that the adjustments
pursuant to clauses (a) and (b) above shall be made only if General Partner
reasonably determines that such adjustments are necessary or appropriate to
reflect the relative economic interests of the Partners in the Partnership
or are otherwise required under the Allocation Regulations;
(iii) The Gross Asset Value of any Partnership asset distributed
to any Partner shall be the gross fair market value of such asset on the
date of distribution; and
(iv) The Gross Asset Values of Partnership assets shall be increased
(or decreased) to reflect any adjustments to the adjusted basis of such
assets pursuant to Code Section 734(b) or Code Section 743(b), 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
Allocation Regulations and Section 4.3; provided, however, that Gross Asset
Values shall not be adjusted pursuant to this clause (iv) to the extent
General Partner determines that an adjustment pursuant to clause (ii)
hereof is necessary or appropriate in connection with a transaction that
would otherwise result in an adjustment pursuant to this clause (iv).
If the Gross Asset Value of an asset has been determined or adjusted
pursuant to Section (i), (ii) or (iv) above, such Gross Asset Value shall
thereafter be adjusted by the Depreciation taken into account with respect to
such asset for purposes of computing Profits or Losses.
"Gross Hotel Revenues." Is defined in Section 12.01 of the Management
Agreement as "Gross Revenues." If the Parking Facility is operated by the
Manager or its Affiliate, the term "Gross Hotel Revenues" includes revenue from
the Parking Facility as well as from the Hotel.
"Guaranty Agreement." The payment and performance guaranty to be executed
by HRI and the Development Guarantors in favor of the Lender.
"Hazardous Material." The collective meanings given to the terms
"hazardous material," "hazardous substances" and "hazardous wastes" in the
Federal Comprehensive Environmental Response, Compensation and Liability Act of
1980, 42 U.S.C. Section 9601 "et seq., as amended, and also any meanings given
to such terms in any similar state or local statutes, ordinances, regulation or
by-laws. Without limiting the generality of the foregoing, the term "Hazardous
Material" shall include oil and any other substance known to be hazardous, such
as hazardous waste, lead-based paint, asbestos, methane gas, urea formaldehyde
insulation, oil, underground storage tanks, polychlorinated biphenyls (PCBs),
toxic substances or other pollutants.
"Hazardous Substance Laws." Any local, state or federal law or regulation
relating to the use or disposition of Hazardous Material, including, without
limitation, the Clean Air Act, the Clean Water Act, the Resource Conservation
and Recovery Act, the Toxic Substance Control Act, the Safe Drinking Water
Control Act, the Comprehensive Environmental Response Compensation and Liability
Act, the Hazardous Materials Transportation Act, and the Occupational Safety and
Health Act, as the same may be amended from time to time.
"HCI." Historic Construction Incorporated, a Louisiana corporation, doing
business as HCI Construction and Design, and its successors.
"Historic Credit Determination." Is defined in Section 5.4.
"Historic Rehabilitation Credit." The tax credit allowable pursuant to
Section 47 of the Code for qualified rehabilitation expenditures incurred in
connection with the certified rehabilitation of the Project.
"Hotel." The hotel facility to be located in the Improvements after the
Rehabilitation which will consist of meeting space and no fewer that 181 guest
rooms and be operated as a Courtyard by Marriott.
"Hotel Expenses." Is defined in Section 12.01 of the Management Agreement
as "Deductions." The term "Hotel Expenses" includes, inter alia, payment of the
Base Management Fee and transfers to the Replacement Reserve, but it does not
include Debt Service.
"HRI." Historic Restoration, Incorporated, a Louisiana corporation, and
its successors.
"HRI-▇▇▇▇▇▇." HRI ▇▇▇▇▇▇ Corporation, a Louisiana corporation that is a
wholly-owned subsidiary of HRI and serves as the initial General Partner of the
Partnership.
"Improvements." All of the buildings, structures, fixtures and other
improvements now or hereafter located on the Land.
"Incentive Hotel Management Fee." The incentive management fee payable to
the Manager pursuant to the Management Agreement.
"Incentive Partnership Management Agreement." The agreement between the
Partnership and the General Partner described in Section 7.5B, in the form which
has been approved by Special Limited Partner.
"Incentive Partnership Management Fee." The fee payable by the Partnership
to General Partner pursuant to the Incentive Partnership Management Agreement.
"Initial Operating Period." The 5 year period commencing on the Placed-in-
Service Date.
"Installment." An installment of the Capital Contribution of Investor
Limited Partner to the Partnership.
"Interior Design Agreement." The "Design Proposal" dated August 11, 1997
by and between Compass Design Limited and HRI.
"Investment Servicing Fee." A servicing fee in the amount of $10,000.00
payable by the Partnership to Special Limited Partner on May 1st of each whole
or partial Fiscal Year beginning after December 31, 1998.
"Investor Limited Partner." Amerus-Blackstone, L.L.C., an Iowa limited
liability company, or any other Person who is admitted to the Partnership in
accordance with the terms of this Agreement and is shown on the books and
records of the Partnership as a Substitute Investor Limited Partner at the time
of reference thereto.
"Investor Limited Partner Loan(s)." A loan(s) made by Investor Limited
Partner to the Partnership to fund the payment of the an Operating Deficit
pursuant to Section 5.8B or a Debt Service Coverage Loan. Such loans shall bear
interest at an annual rate equal to the lesser of the Designated Interest Rate
plus 7% or the highest rate permitted by law, and shall, if Investor Limited
Partner so requests, be evidenced by unsecured, transferable promissory notes of
the Partnership, in form and substance satisfactory to Investor Limited Partner,
provided that any such Investor Limited Partner Loan need not be evidenced by
such a note. If Investor Limited Partner requests such a promissory note,
General Partner will execute on behalf of the Partnership such a promissory note
and deliver such executed promissory note to Investor Limited Partner within
three business days after such request. If General Partner fails to execute and
deliver such a promissory note within such time, Special Limited Partner is
authorized to execute such a promissory note on behalf of the Partnership and to
deliver such promissory note to Investor Limited Partner. Investor Limited
Partner Loans shall be repaid as provided in Section 6, and no recourse for the
payment thereof may be had against any other property of the Partnership or
against any Partner, provided that such limitation on recourse will not limit or
reduce any obligation of General Partner. In addition, General Partner shall
have the right to make a Voluntary General Partner Loan to enable the
Partnership to repay any Investor Limited Partner Loan at any time. Payments of
principal and interest on Investor Limited Partner Loans shall be applied in the
same order in which such Investor Limited Partner Loans are made (i.e., on a
first-in, first-out basis). No Investor Limited Partner Loan will cure any
default by General Partner which may otherwise exist or which may relate to such
Investor Limited Partner Loan, and Investor Limited Partner shall retain all of
Investor Limited Partner's rights and remedies with respect to any such default
by General Partner.
"IRS." The Internal Revenue Service.
"Land." The land bordered by ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ and
▇▇▇▇▇▇▇ Street, Block 100, in the City of Omaha, County of ▇▇▇▇▇▇▇, State of
Nebraska, and the land comprised of a portion of ▇▇▇▇ ▇ ▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇, ▇▇ ▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ of ▇▇▇▇▇▇▇, State of Nebraska, all as more particularly
described on Exhibit B attached hereto.
"Lender." GMAC Commercial Mortgage Corporation, a California corporation,
and its successors and assigns, and any lender whose loan is made to refinance
the Deed of Trust Loan in accordance with this Agreement.
"Letter of Credit." An unconditional, irrevocable letter of credit in the
amount of $2,064,000.00 (which, with renewals thereof, shall have a term
coextensive with the term of the Gap Loan) issued by Federal Home Loan Bank of
Des Moines or a financial institution satisfactory to the Partnership, at the
request of Investor Limited Partner or an Affiliate of Investor Limited Partner,
in favor of the Lender, and issued at the Mortgage Loan Closing. The Letter of
Credit will be used solely to satisfy the condition of the Mortgage Loan that
the Partnership have equity of $5,550,000.00 (which amount includes the TIF
Advance Loan proceeds and the Partners' obligations to make additional capital
contributions or Subordinate Partner Loans) at the Gap Loan Closing. The Letter
of Credit shall be in "sight draft" form and may be drawn upon by the Lender or
released as provided in the Loan Documents.
"LIBOR." Is defined in Section 2(b) of the Deed of Trust Note.
"Limited Partner(s)." Investor Limited Partner, Special Limited Partner
and/or any other Person admitted to the Partnership from time to time as a
limited partner in accordance with the terms of this Agreement.
"Limited Partnership Interest." The Partnership Interest of a Limited
Partner in such Partner's capacity as such.
"Loan Documents." Deed of Trust Note, Deed of Trust, Building Loan
Agreement, Guaranty Agreement, Environmental Indemnity Agreement, Assignment of
Construction Agreements, Plans and Property Agreements, and any other documents
required by Lender in connection with the Mortgage Loan.
"Manager." Courtyard Management Corporation, a Delaware corporation, and
any successor property manager designated or appointed from time to time in
accordance with the terms of this Agreement.
"Management Agreement." The "Management Agreement" dated November 7, 1997
by and between the Partnership and the Manager pursuant to which the Manager
will manage and operate the Hotel and the Parking Facility on the terms and
conditions set forth therein, which terms and conditions have been approved by
Special Limited Partner.
"Management Fee." The Base Management Fee and the Incentive Hotel
Management Fee payable to the Manager pursuant to the terms of the Management
Agreement.
"Managing General Partner." Any Person designated as such in accordance
with the provisions of Section 7.3B.
"Material Default." The occurrence of any of the following events:
(i) a material breach by General Partner (or any of General Partner's
Affiliates) in the performance of any of such Person's material obligations
under this Agreement (including a failure to meet its monetary obligations
under Sections 5.11, 5.12, 5.13 and/or 5.14) or under any other agreement
which breach materially adversely affects or could materially adversely
affect either of the Limited Partners, provided that the inability of the
Partnership to pay the Mortgage Loan or any other financial obligation of
the Partnership to any party other than the Limited Partners under the
Project Documents shall not be deemed a Material Default, provided,
however, that the foregoing proviso will not limit Partnership's
obligations to the Limited Partners under this Agreement and the other
Project Documents;
(ii) a Terminating Event as to General Partner, or an Event of
Bankruptcy as to General Partner or as to the Partnership; provided,
however, if (a) the Operating Deficit Reserve and the Cash Collateral Fund
have all been fully disbursed, and General Partner has fully satisfied all
of General Partner's obligations to make Operating Deficit Loans, and if
Investor Limited Partner has not made Investor Limited Partner Loans to
fund Operating Deficits so that at such time all Operating Deficits have
been funded, and (b) the Partnership is not then indebted to the Investor
Limited Partner (or its Affiliates) with respect to any Investor Limited
Partner Loans, then General Partner, at General Partner's election, upon
written notice to Special Limited Partner, may cause the Partnership to
file for a reorganization under Chapter 11 of the United States Bankruptcy
Code (or a similar proceeding under any substitute law) provided that such
proceeding does not threaten any action which could cause a recapture of
any portion of the Historic Rehabilitation Credit, and such act by General
Partner or the Partnership will not constitute a Material Default;
(iii) a violation by General Partner or any Affiliate of General
Partner of such Person's fiduciary duties to the Partnership;
(iv) a violation by General Partner or any Affiliate of General
Partner of any law, regulation or order applicable to the Partnership which
has or may have a material adverse effect on either of the Limited
Partners, which violation is not cured or remedied within any applicable
period provided with respect to such law, regulation, or order;
(v) a material breach by the Partnership, General Partner in its
capacity as general partner of the Partnership, or any Affiliate of General
Partner under any Project Document or other material agreement or document
benefitting the Partnership or either of the Limited Partners which breach
materially, adversely affects or could materially, adversely affect either
of the Limited Partners; provided, however, that the inability of the
Partnership or General Partner in its capacity as the general partner of
the Partnership to pay the Mortgage Loan or any other financial obligation
of the Partnership to any party other than the Limited Partners under the
Project Documents shall not be deemed a Material Default, provided,
however, that the foregoing proviso will not limit General Partner's
obligations to the Limited Partners under this Agreement and the other
Project Documents;
(vi) the failure of the Temporary Certificate of Occupancy Date to
occur on or before the Completion Date;
(vii) the inability of General Partner to deliver a Payment
Certificate under Section 5.2 which continues for a period of 6 months
following the date on which the Second Installment would otherwise be due
(or, if earlier, December 31, 1999);
(viii) any representation or warranty relating to the Project, the
Partnership, or to the Limited Partners' admission into the Partnership
which is made to the Partnership or to either Limited Partner by General
Partner, the Development Guarantors, or any Affiliate of General Partner,
whether made in this Agreement, or in the Development Guaranty Agreement,
or in any other document which this Agreement contemplates to be executed
or delivered, proves to be untrue in any material respect as of the date
such representation or warranty was issued or made and which has or could
have a material adverse effect on the Partnership or either of the Limited
Partners;
(ix) the Development Guaranty Agreement ceases to be in full force
and effect for any reason other than pursuant to the terms thereof, or
either or both of the Development Guarantors denies that such guarantor has
any further liability under the Development Guaranty Agreement or gives
notice of such effect or asserts (other than in good faith and based upon a
reasonable acknowledged legal basis) any defense to liability under the
Development Guaranty Agreement;
(x) General Partner's failure to execute any promissory note
evidencing an Investor Limited Partner Loan in accordance with the terms of
this Agreement;
(xi) General Partner's failure to withdraw funds from the Operating
Reserve, or the Cash Collateral Fund, as applicable, to pay Operating
Deficits in accordance with Section 5.8A;
(xii) HRI's failure, at any time during the Initial Operating Period,
to maintain a net worth equal to or greater than $4,000,000.00 determined
in accordance with GAAP;
(xiii) any material default under the Development Guaranty Agreement;
(xiv) General Partner's failure to reimburse Investor Limited Partner
for any amount drawn against the Letter of Credit and/or TIF Letter of
Credit as provided in Section 5.11, provided that, if at the time that such
reimbursement is due, either all of the conditions precedent to payment of
the Second Installment have been satisfied, including the expiration of any
applicable time periods, and Investor Limited Partner has failed to pay all
of the amount of the Second Installment (as such amount may be reduced for
any right of offset available to Investor Limited Partner under the terms
of this Agreement), or all of the conditions precedent to funding of the
Subordinated Partner Loan by the Investor Limited Partner have been
satisfied, including the expiration of any applicable time periods, and
Investor Limited Partner has failed to fund its share of the Subordinated
Partner Loans (as such funding obligation may be reduced for any right of
offset available to Investor Limited Partner under the terms of this
Agreement), then General Partner shall have the right to offset and apply
such reimbursements for and on behalf of Investor Limited Partner as
payment of such Second Installment or funding of such share of the
Subordinated Partner Loan, as applicable, in an amount equal to the amount
which Investor Limited Partner failed to pay or fund, and such offset and
application of such funds in payment of the Second Installment or funding
of the Subordinated Partner Loan, as applicable, shall (to the extent of
the amount thereof) not constitute a Material Default so long as General
Partner otherwise complies with the requirements of Section 5.11; or
(xv) the occurrence of an Event of Default under the Put Loan
Documents.
"Material Violation." Is defined in Section 7.11Q.
"Mortgage Loan." The loan to be made by the Lender to the Partnership
evidenced by the Deed of Trust Note and secured by the Deed of Trust, which is
made to finance the acquisition and Rehabilitation of the Project and to provide
term financing for the Project.
"Mortgage Loan Closing." The date on which the Loan Documents become
effective between the Lender and the Partnership.
"Mortgage Loan Extension Privilege." The Partnership's option to extend
the term of the Mortgage Loan for an additional 12 month period on the terms and
conditions set forth in the Loan Documents.
"Negative Completion Adjuster." Is defined in Section 5.3B.
"Negative Historic Adjustment." Is defined in Section 5.4.
"Negative Historic Credit Difference." Is defined in Section 5.4.
"Net Hotel Revenues." The excess of Gross Hotel Revenues over Hotel
Expenses for the applicable period of time. The term "Net Hotel Revenues" has
the same meaning as "Operating Profit" in Section 12.01 of the Management
Agreement.
"Net Commercial Space Lease Rent." The excess of Commercial Space Lease
Rent over Commercial Space Lease Expenses for the applicable period of time.
"Nonrecourse Debt or Nonrecourse Liability." Any indebtedness for which
none of the Partners has any economic risk of loss other than through such
Partner's interest in the Partnership Property securing such indebtedness, as
defined in Section 1.704-2(b)(3) of the Allocation Regulations.
"Nonrecourse Deductions." The meaning set forth in Section 1.704-2(b)(1)
of the Allocation Regulations.
"Off-Site Parking Facility." The parking facility, which will consist of
approximately 50 parking spaces, located on that portion of the Land situated on
Lots 7 and 8, Block 101, in the City.
"Operating Deficit." For any specified period of time, the amount by which
the sum of (i) Hotel Expenses, (ii) Commercial Space Lease Expenses, (iii)
Project Expenses, and (iv) Debt Service (only after the Manager has made any of
the Debt Service Deficiency Loans required of Manager under the Management
Agreement or Manager defaults in making a Debt Service Deficiency Loan) for such
period exceeds Cash Receipts.
"Operating Deficit Loan(s)." A loan(s) made by General Partner to the
Partnership to fund Operating Deficits pursuant to Section 5.8A and/or to pay
down the Mortgage Loan in connection with the exercise of the Mortgage Loan
Extension. Such loans, which shall bear interest at an annual rate equal to the
Designated Interest Rate, shall be evidenced by unsecured, nontransferable
promissory notes of the Partnership. Such loans shall be repaid only as
provided in Section 6, and no recourse for the payment hereof may be had against
any other property of the Partnership or against any Partner. Payments of
principal and interest on Operating Deficit Loans shall be applied in the same
order in which such Operating Deficit Loans are made (i.e., on a first-in,
first-out basis).
"Operating Deficit Loan Maximum." The maximum principal amount of
Operating Deficit Loans which General Partner is obligated to have outstanding
at any time, which is the amount equal to $1,125,000 minus the initial
aggregated amount(s) of the Operating Reserve and the Working Capital Reserve.
"Operating Profits or Losses." For any Fiscal Year means the Profits or
Losses of the Partnership for that Fiscal Year as determined for federal income
tax purposes by the Accountants, excluding Profits or Losses from a Capital
Transaction and determined without regard to any adjustments to basis pursuant
to Sections 734 or 743 of the Code.
"Operating Projection." The annual operating projection for the Project as
prepared by the Manager pursuant to Section 4.04 of the Management Agreement.
"Operating Reserve." The reserve in the initial amount of $382,600.00, to
be funded from the Mortgage Loan, which is to be used to fund Operating
Deficits. The Operating Reserve will be held in interest bearing accounts which
are fully insured by the Federal Deposit Insurance Corporation, or in such other
investments as Special Limited Partner may approve. Interest earned on such
funds will be retained in the Operating Reserve and will be used for the same
purposes as other funds held in the Operating Reserve. In the event of the sale
of the Project at a time when funds are held in the Operating Reserve, such
funds will be treated as additional Sales Proceeds and will be applied as
provided in Section 6.2C.
"Parking Facility." The parking facility, which will consist of
approximately 140 parking spaces, to be located on that portion of the Land
situated between ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ Street
after the Rehabilitation.
"Partner." Any General Partner or Limited Partner.
"Partner Nonrecourse Debt." The meaning set forth in Section 1.704-2(b)(4)
of the Allocation Regulations.
"Partner Nonrecourse Debt Minimum Gain." The meaning set forth in Sections
1.704-2(i)(2) and (3) of the Allocation Regulations.
"Partner Nonrecourse Deductions." The meaning set forth in Section 1.704-2
(i)(1) of the Allocation Regulations.
"Partnership." The limited partnership created by this Agreement.
"Partnership Counsel." ▇▇▇▇▇▇, P.L.C., of New Orleans, Louisiana.
"Partnership Interest." The interest of a Partner in the Partnership,
including, without limitation, such Partner's interest in the assets, capital,
Profits or Losses, Distributions and Tax Credits of the Partnership.
"Partnership Items." Is defined in Section 6.5M.
"Partnership Minimum Gain." The meaning set forth in Section 1.704-2(d) of
the Allocation Regulations.
"Partnership Property." All real and personal property owned by the
Partnership.
"Partnership Reserves." Reserves maintained by the Partnership for working
capital, capital improvements and similar contingencies, including, without
limitation, the Operating Reserve, the Working Capital Reserve, and the
Replacement Reserve. Except as expressly provided in this Agreement any funds
held in the Partnership Reserves which are no longer required for the purposes
for which they were set aside shall be distributed to the Partners pursuant to
the provisions of Section 6.2A.
"Payment Certificate." Is defined in Section 5.2E.
"Person." Any individual or Entity, and the heirs, executors,
administrators, legal representatives, successors and assigns of such Person
where the context so admits; and, unless the context otherwise requires, the
singular shall include the plural, and the masculine gender shall include the
feminine and the neuter and vice versa.
"Personal Property." Those items of tangible or intangible personal
property, including, any permits, licenses, signs, containers and equipment,
located on or associated with the Land and to be acquired from the Seller.
"Placed-in-Service Date." The earliest date that the entire site upon
which the Project is located is "placed in service" for federal income tax
purposes under Section 47 of the Code; provided, however, that, in the event
that (i) the tenant improvements on the portion of the Project shown as the
approximate 7,600 square feet of commercial space located on the ground floor of
the Hospe Building in the Plans and Specifications prior to the date the
remaining portion of the Project is "placed in service" under Section 47 of the
Code, and (ii) the General Partner is unable to finish out such premises or
find, in the exercise of due diligence and subject to the Consent of the Special
Limited Partner, a suitable tenant to complete such improvements and operate
such premises prior to the date the remaining portion of the Project is "placed
in service" under Section 47 of the Code, then the date such remaining portion
is so "placed in service" shall be deemed to be the date the entire site upon
which the Project is located is so "placed in service" for purposes of this
Agreement.
"Plans and Specifications." The drawings dated October 1, 1997, and the
specifications last revised October 1, 1997 for the Rehabilitation of the
Project approved by the Lender and Special Limited Partner, including, without
limitation, specifications for materials, and all amendments and modifications
thereof, provided, however, that no amendment or modification may be made to
such plans and specifications which would affect the availability of the
Historic Rehabilitation Credit, or which would materially affect the amount of
the Historic Rehabilitation Credit or the cost of the construction and
Rehabilitation of the Project, or which would otherwise materially affect the
Project.
"Positive Completion Adjuster." Is defined in Section 5.3B.
"Positive Historic Adjustment." Is defined in Section 5.4.
"Positive Historic Credit Difference." Is defined in Section 5.4.
"Priority Amount." Is defined in Section 6.2B, Clause Twelfth.
"Profits or Losses." For each Fiscal Year or other period, an amount equal
to the" Partnership's taxable income or loss for such Fiscal Year or other
period, determined i"n accordance with Section 703(a) of the Code (for this
purpose, all items of income, gain, loss, or deduction required to be stated
separately pursuant to Section 703(a)(1) of the Code shall be included in
taxable income or loss), with the following adjustments:
(i) Any items described in Sections 705(a)(1)(B) and 705(a)(1)(C) of
the Code which are not otherwise taken into account in computing Profits or
Losses shall be added to such taxable income or loss.
(ii) Any expenditures of the Partnership described in Section
705(a)(2)(B) of the Code or treated as Section 705(a)(2)(B) expenditures
pursuant to Section 1.704-1(b)(2)(iv)(i) of the Allocation Regulations, and
not otherwise taken into account in computing Profits or Losses, shall be
subtracted from such taxable income or loss.
(iii) 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 the property disposed of, notwithstanding that the adjusted tax basis of
such property differs the Gross Asset Value of such property.
(iv) In the event of a distribution of Partnership assets to a
Partner (whether in connection with a liquidation or otherwise), or in the
event the Gross Asset Value of any Partnership asset is adjusted upon the
acquisition of an additional interest in the Partnership, unrealized
income, gain, loss and deduction inherent in such distributed or adjusted
assets (not previously reflected in Capital Accounts) shall be allocated
pursuant to Section 6.1 as if there had been a taxable disposition of such
distributed or adjusted assets at fair market value.
(v) In lieu of the depreciation, amortization, and other cost
recovery deductions taken into account in computing such taxable income or
loss, there shall be taken into account Depreciation for such Fiscal Year
or other period, computed in accordance with the definition of
"Depreciation" set forth herein.
(vi) Notwithstanding any other provision of this definition, any
items which are specially allocated pursuant to Section 6.5 shall be taken
into account in computing Profits or Losses only if the Accountants
determine that such items should be so reflected.
"Profits or Losses from a Capital Transaction." The Profits or Losses, if
any, recognized by the Partnership as a result of a Capital Transaction, as
determined for federal income tax purposes by the Accountants, but without
regard to any adjustments to basis pursuant to Section 734 and 743 of the Code.
"Project." The Rehabilitation of the Land and Improvements into, and the
operation of, the Hotel, Parking Facility, Off-Site Parking Facility and
Commercial Space.
"Project Documents." The Assignment of the Purchase Agreement, the Deed,
the Loan Documents, the Gap Loan Documents, the Tax Financing Documents, the
Development Agreement, the Construction and Design Contract, the Management
Agreement, the Incentive Partnership Management Agreement, the City Leases and
all other documents relating to the Project which are required by, or have been
executed in connection with, any of the foregoing documents.
"Project Expenses." All operating and other costs and expenses of the
Partnership determined on an accrual basis during the Fiscal Year, other than
Incentive Hotel Management Fee, Investment Servicing Fee, Incentive Partnership
Management Fee, and operating and other costs and expenses included in the
determination of Hotel Expenses, Commercial Space Lease Expenses or Debt
Service.
"Projections." The economic projections dated November 17, 1997, which
have been submitted to, and approved by, Special Limited Partner and attached
hereto as Exhibit E.
"Purchase Agreement." That certain "Agreement to Purchase and Sell," dated
September 9, 1996, by and between Seller and HRI, as amended by that "Amendment
to Agreement to Purchase and Sell" dated September 5, 1997, whereunder the
Seller has agreed to sell the Real Property to HRI or its assigns upon the terms
and conditions set forth therein.
"Put Loan Documents." That certain "Loan Agreement" between HRI and AmerUs
Life Insurance Company and the "Loan Documents" (as that term is defined in such
Loan Agreement) referred to therein.
"Real Property." The Land and Improvements, before and after the
Rehabilitation.
"Recapture Event." A disposition or other event causing recapture of all
or any portion of the Historic Rehabilitation Credit pursuant to the provisions
of Section 50 of the Code.
"Redevelopment Agreement." The "Redevelopment Agreement" dated October 8,
1997 by and between the City and HRI entered into pursuant to the Downtown
Northeast Redevelopment Plan adopted by the City to implement the
Rehabilitation.
"Redevelopment Note" The "Redevelopment Promissory Note" in the amount of
$1,519,000.00 made by City in favor of the Partnership representing the City's
indebtedness for tax increment financing to the Partnership pursuant to the
Redevelopment Agreement.
"Refinancing Proceeds." The gross proceeds available to the Partnership
from a refinancing of any of the Mortgage Loan or any other secured or unsecured
indebtedness of the Partnership.
"Regulations." The rules and regulations applicable to the Project or the
Partnership of any" Governmental Authority asserting jurisdiction over the
matter in question.
"Regulatory Allocations." The allocations set forth in Sections 6.5A
through 6.5G.
"Rehabilitation." The development, construction, renovation, and
rehabilitation work on the Project described in the Plans and Specifications.
"Reimbursement Agreement." That certain "Reimbursement Agreement" dated
November 18, 1997 by and between the Partnership and Marriott International,
Inc., a Delaware corporation.
"Related Person." The meaning set forth in Section 1.752-4(b) of the
Allocation Regulations.
"Replacement Reserve." The replacement reserve as required by the Manager
pursuant to Section 5.02 of the Management Agreement.
"Repurchase Event." Is defined in Section 5.12A.
"Requisite Approvals." The approval or consent of the Lender or any
Governmental Authority asserting jurisdiction over the Partnership or the
Project, to the extent required pursuant to the terms of any of the Project
Documents.
"Retired General Partner." Is defined in Section 10.4C.
"Sale Proceeds." The gross proceeds available to the Partnership from the
sale or other disposition of all or any portion of the Project or the
Partnership's other assets, or any proceeds realized from a condemnation,
insured casualty (in excess of the amount of such proceeds used for repair or
reconstruction of the Project), or insured title defect, but excluding proceeds
from rental interruption insurance, if any.
"Schedule." Schedule A attached hereto.
"Second Installment." Is defined in Section 5.1A.
"Seller." ▇▇▇▇▇▇, Inc. of Omaha, a Nebraska corporation.
"Share of Partner Nonrecourse Debt Minimum Gain." For each Partner, an
amount equal to such Partner's share of partner nonrecourse debt minimum gain,"
determined in accordance with the provisions" of Section 1.704-2(i)(5) of the
Allocation Regulations.
"Share of Partnership Minimum Gain." For each Partner, an amount equal to
such Partner's "share of partnership minimum gain," determined in accordance
with the provisions of Section 1.704-2(g) of the Allocation Regulations."
"Site." The meaning given to such term in the Federal Comprehensive
Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. Sec.
9601 et seq., as amended, and any meaning given to such term in any similar
state or local statutes, ordinances, regulations or by-laws.
"Special Class Limited Partner." The meaning set forth in Sections 10.4B
and 10.4C.
"Special Counsel." ▇▇▇▇▇▇, P.L.C. of New Orleans, Louisiana.
"Special Limited Partner." AmerUs Management, Inc., an Iowa corporation,
or any other Person who is admitted to the Partnership and shown on the books
and records of the Partnership as a substituted Special Limited Partner at the
time of reference thereto.
"State." The State of Nebraska.
"Subordinated Partner Loan(s)." Loans which General Partner and Investor
Limited Partner are obligated to make to the Partnership pursuant to Section
5.14. Such loans shall bear interest at an annual rate equal to the Designated
Rate plus 7%, shall be evidenced by unsecured, non-negotiable promissory notes
of the Partnership, and shall be repaid as provided in Section 6; PROVIDED,
HOWEVER, in the event the conditions set forth in Section 5.2 have not occurred
on or before December 31, 1999, all principal and accrued interest on such loans
shall become then due and payable. No recourse for the payment thereof may be
had against any other property of the Partnership or against any Partner.
"Substitute Limited Partner." Any Person admitted into the Partnership as
Substitute Limited Partner as provided in Section 11.3.
"Substitute Partner." A Person who shall become entitled to receive a
share of the Profits, Losses, Tax Credits and Distributions of the Partnership
by reason of such Person succeeding to the Partnership Interest of a Partner by
assignment of all or any part of a Partnership Interest.
"Tax Credits." Any credit(s) permitted under the Code against the federal
income tax liability of any Partner as a result of activities or expenditures of
the Partnership including, without limitation, the Historic Rehabilitation
Credit.
"Tax Financing Documents." The TIF Loan Documents, the Redevelopment
Agreement and any other documents required by the City or the Bank in connection
with the tax increment financing on the Project.
"Temporary Certificate of Occupancy." The temporary certificate of
occupancy issued by the appropriate Governmental Authority authorizing the use
and occupancy of the entire Project as the Hotel, Parking Facility, Off-Site
Parking Facility and Commercial Space in accordance with the Plans and
Specifications, provided, however, that the only work remaining to be done is of
a nature which would not impair the permanent occupancy of any portion of the
Project and General Partner has delivered to Special Limited Partner the Second
Installment Payment Certificate of General Partner in the form attached to this
Agreement as Exhibit C; further, provided, that, in the event that the tenant
improvements on the portion of the Project shown as the approximate 7,600 square
feet of commercial space located on the ground floor of the Hospe Building in
the Plans and Specifications prior to the issuance of such a temporary
certificate of occupancy by the Governmental Authority and the General Partner
is unable to finish out such premises or find, in the exercise of due diligence
and subject to the Consent of the Special Limited Partner, a suitable tenant to
complete such improvements and operate such premises prior to such time such a
temporary certificate of occupancy with respect to the remaining portion of the
Project is issued by the Governmental Authority, the issuance of such a
temporary certificate of occupancy by the appropriate Governmental Authority
authorizing the use and occupancy of the remaining portion of the Project as the
Hotel, Off-Site Parking Facility and Parking Facility in accordance with the
Plans and Specifications, as contemplated by this Agreement shall constitute the
temporary certificate of occupancy for purposes of this Agreement.
"Temporary Certificate of Occupancy Date." The date on which the
Partnership has received a Temporary Certificate of Occupancy, in accordance
with the requirements of the definition of Temporary Certificate of Occupancy.
"Terminating Capital Transaction." A Capital Transaction resulting in or
involving the termination and winding up of the business of the Partnership or
any other event resulting in the "liquidation" of the Partnership within the
meaning of Section 1.704-1(b)(2)(ii)(g) of the Allocation Regulations.
"Terminating Event." The occurrence of an event of withdrawal described in
Section 17-402 of the Act with respect to General Partner.
"Third Deed of Trust." The "Deed of Trust, Assignment of Leases and Rents,
and Security Agreement" between the Partnership and Marriott International, Inc.
"TIF Advance Loan." The loan to be made by the Bank to the Partnership
pursuant to the TIF Loan Agreement and evidenced by the TIF Advance Note and
secured by the TIF Letter of Credit and a pledge of the Redevelopment Note,
which loan is made to finance the acquisition and Rehabilitation of the Project
and to provide term financing for the Project.
"TIF Advance Loan Closing." The date on which the TIF Loan Documents
become effective between the Lender and the Partnership.
"TIF Advance Note." The promissory note in the amount of $1,519,000.00
made by the Partnership in favor of the Bank representing the Partnership's
indebtedness to the Bank pursuant to the TIF Loan Agreement, .
"TIF Letter of Credit." A standby irrevocable letter of credit in the
amount of $1,720,000.00 (which, with renewals thereof, shall expire on the later
of the issuance of the Certificate of Occupancy or the opening of the Hotel for
business to the public) issued by the Federal Home Loan Bank of Des Moines or a
financial institution satisfactory to the Partnership, at the request of
Investor Limited Partner or an Affiliate of Investor Limited partner, in favor
of the Bank and issued at the TIF Advance Loan Closing.
"TIF Loan Agreement." The loan agreement to be executed by and between the
Bank and the Partnership.
"TIF Loan Documents." The TIF Loan Agreement, TIF Advance Note, the TIF
Letter of Credit and such other documents, instruments, environmental indemnity
agreements and pledges as may be required by the Bank in connection with the TIF
Advance Loan.
"Title Policy." The owner's policy of title insurance to be issued to the
Partnership by First American Title Insurance Company in the amount of
$19,725,000.00 (not including special coverage endorsements).
"TMP." Is defined in Section 7.9A.
"Transfer." Any sale, exchange, assignment, encumbrance, hypothecation,
pledge, foreclosure, conveyance in trust, gift or other transfer of any kind,
whether direct or indirect, voluntary or involuntary, other than as a direct
consequence of a Terminating Event. When used as a verb, such term shall mean,
voluntarily or involuntarily, to sell, exchange, assign, encumber, hypothecate,
pledge, foreclose, convey in trust, give or otherwise transfer.
"Vessel." The meaning given to such term in the Federal Comprehensive
Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. Sec.
9601 et seq., as amended, and any meaning given to such term in any similar
state or local statutes, ordinances, regulations or by-laws.
"Voluntary General Partner Loan." Any loan made by General Partner to the
Partnership to pay Project Expenses which General Partner voluntarily makes and
is not obligated to make under this Agreement. Operating Deficit Loans and
Excess Adjustment Loans are not Voluntary General Partner Loans. Such loans
shall bear interest at an annual rate equal to the lesser of the Designated
Interest Rate plus 7%, or the highest rate permitted by law, and shall be
evidenced by unsecured, nontransferable promissory notes of the Partnership, in
form and substance satisfactory to General Partner and Special Limited Partner.
Voluntary General Partner Loans shall be repaid as provided in Section 6, and no
recourse for the payment hereof may be had against any other property of the
Partnership or against any Partner. Payments of principal and interest on
Voluntary General Partner Loans shall be applied in the same order in which such
Voluntary General Partner Loans are made (i.e., on a first-in, first-out basis).
"Working Capital Reserve." The reserve in the initial amount of
$72,400.00, to be funded from the Mortgage Loan, which is to be used and applied
to cover Operating Deficits. The Working Capital Reserve will be held in
interest-bearing accounts which are fully insured by the Federal Deposit
Insurance Corporation, or in such other investments as Special Limited Partner
may approve. Interest earned on such funds will be retained in the Working
Capital Reserve and will be used by Manager in accordance with the Management
Agreement for the same purposes as other funds held in the Working Capital
Reserve. In the event of the sale of the Project at a time when funds are held
in the Working Capital Reserve, such funds will be applied as provided in the
Management Agreement, with any excess applied as provided in Section 6.2C.
SECTION 2: CONTINUATION
Section 2.1 Continuation
The Partners hereby agree to continue the limited partnership known as
▇▇▇▇▇▇ Renewal Limited Partnership formed pursuant to the provisions of the Act
and the Original Agreement.
Section 2.2 Name and Office; Registered Agent and Office
The Partnership shall continue to be conducted under the name and style set
forth in Section 2.1. The principal office of the Partnership shall be c/o
Historic Restoration, Incorporated, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇. The name of the Partnership's registered agent and its
registered office for service of process in Nebraska shall be ▇▇▇▇▇▇▇ ▇. ▇▇▇▇,
Esq., ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇. The General Partner may at any
time change the location of its principal office, registered office and/or
registered agent and shall give due notice of any such change(s) to each Limited
Partner and make all requisite filings to reflect such change(s) with applicable
Governmental Authority.
Section 2.3 Purpose
The business and purpose of the Partnership shall consist solely of the
acquisition, rehabilitation, development, improvement, maintenance, ownership,
operation, leasing and disposition of the Project in accordance with the Project
Documents, any applicable Regulations, and the provisions of this Agreement and
such other activities as are necessary, incidental or appropriate in connection
therewith. The Partnership shall not engage in any other business or activity.
Section 2.4 Authorized Acts
In furtherance of the purposes of the Partnership, but subject to all other
provisions of this Agreement including, but not limited to, Section 3 and
Section 7, the Partnership is hereby authorized:
(i) To acquire by purchase, lease or otherwise, any real or personal
property which may be necessary, convenient or incidental to the
accomplishment of the purposes of the Partnership;
(ii) To construct, reconstruct, rehabilitate, operate, maintain,
finance and improve, and to own, sell, convey, assign, mortgage or lease
any real estate and any personal property necessary, convenient or
incidental to the accomplishment of the purposes of the Partnership;
(iii) To borrow money and issue evidences of indebtedness in
furtherance of any or all of the purposes of the Partnership, and to secure
the same by mortgage, pledge or other lien on the Project or any other
assets of the Partnership, to the extent permitted by the Project
Documents;
(iv) To pay in whole or in part, refinance, recast, increase, modify
or extend the Mortgage Loan, the Gap Loan, the TIF Advance Loan, the Third
Mortgage, or any other mortgage loans affecting the Project and in
connection therewith to execute any extensions, renewals, or modifications
of the Mortgage Loan or any such other loans on the Project;
(v) To enter into, perform and carry out, contracts of any kind,
including contracts with Affiliates of a Partner, necessary to, in
connection with or incidental to, the accomplishment of the purposes of the
Partnership, specifically including, but not limited to, the execution and
delivery of the Management Agreement and the Development Agreement,
Construction and Design Contract, and Incentive Partnership Management
Agreement, and all other agreements, certificates, instruments or documents
required by any Governmental Authority in connection with the Project
Documents and the acquisition, construction, Rehabilitation, development,
improvement, maintenance and operation of the Project;
(vi) To execute leases of any or all of the rentable space in the
Project, specifically including, but not limited to, the Commercial Space
Lease and the City Leases;
(vii) To execute any and all notes, mortgages and security agreements
(including a confession of judgement, waiver of appraisal) in order to
secure loans from the Lender and any and all other documents (including but
not limited to the Loan Documents, Tax Financing Documents, the Third
Mortgage and the Gap Loan Documents) required by the Lender in connection
with the Deed of Trust, the Mortgage Loan, the Third Mortgage, the Gap Deed
of Trust, the Gap Loan, the Tax Financing Documents and the acquisition,
development, improvement, maintenance and operation of the Project, or
otherwise required by the Lender in connection with the Project;
(viii) To employ any Person, including an Affiliate or any Partner,
to perform services for, or to sell goods to, the Partnership (including
without limitation, management services) and to pay for such goods and
services; provided that (except with respect to any contract specifically
authorized by this Agreement) the terms of any such transaction with an
Affiliate or a Partner shall not be less favorable to the Partnership than
would be arrived at by unaffiliated parties dealing at arms' length, and
shall be subject to any applicable Regulations;
(ix) To modify or amend the terms of any agreement or contract which
General Partner is authorized to enter into on behalf of the Partnership;
provided, however, that such terms as amended shall not (i) have a material
adverse effect on the Partnership or either of the Limited Partners, or
(ii) be in contravention of any of the terms or conditions of this
Agreement or the Project Documents;
(x) To execute contracts with the Lender and/or any Governmental
Authority;
(xi) To execute and deliver the Loan Documents, the Gap Loan
Documents, the TIF Loan Documents and the other Project Documents and any
notices, documents or instruments required to be executed or delivered in
connection therewith;
(xii) To employ or engage such engineers, architects, technicians,
managers, accountants, lawyers and other Persons, including any Affiliate
of a Partner as may be necessary, convenient or incidental to the
accomplishment of the purposes of the Partnership; and
(xiii) To enter into any kind of activity and to perform and carry
out contracts of any kind necessary to, or in connection with, or
incidental to, the accomplishment of the purposes of the Partnership, so
long as said activities and contracts may be lawfully carried on or
performed by a partnership under the laws of the State and are not in
contravention with the terms of this Agreement.
Section 2.5 Term and Dissolution
A. The Partnership shall continue in full force and effect until December
31, 2046, except that the Partnership shall be dissolved prior to such date upon
the happening of any of the following events:
(i) The sale or other disposition of all or substantially all the
assets of the Partnership;
(ii) The occurrence of a Terminating Event unless the business of the
Partnership is continued pursuant to the provisions of Section 10;
(iii) The election to dissolve the Partnership made in writing by
General Partner with the Consent of Special Limited Partner, which Consent
may be withheld or granted in Special Limited Partner's sole and absolute
discretion, and, if required, any Requisite Approvals; or
(iv) The entry of a final decree of dissolution of the Partnership by
a court of competent jurisdiction.
B. Upon dissolution of the Partnership (unless the business of the
Partnership is continued pursuant to the provisions of Section 10), General
Partner, unless such dissolution is caused by a Terminating Event as to General
Partner, shall liquidate the Partnership's assets and apply and distribute the
proceeds thereof in accordance with Section 6.3. If such dissolution is caused
by a Terminating Event as to General Partner, then Special Limited Partner shall
liquidate the Partnership's assets and apply and distribute the proceeds thereof
in accordance with Section 6.3.
SECTION 3: ACQUISITION, FINANCING, REHABILITATION, AND DISPOSITION OF
PROPERTY
Section 3.1 Acquisition.
A. The Assignment of the Purchase Agreement is hereby approved,
confirmed, and ratified by the Partnership. The Partnership shall acquire the
Land and Improvements by virtue of the Deed.
B. General Partner is specifically authorized, for and on behalf of the
Partnership, to execute the Deed. Subsequent to the execution of said
documents, General Partner is, subject to the limitations set forth in this
Agreement, specifically authorized, for and on behalf of the Partnership, to
execute such other documents as General Partner reasonably deems necessary in
connection with the acquisition of the Land and Improvements, provided such
documents are consistent with and in accordance with the terms of this
Agreement.
Section 3.2 Financing.
A. The General Partner shall be authorized to cause the Partnership to
borrow (i) the Mortgage Loan from the Lender, which Mortgage Loan will be in the
maximum amount of $14,175,000.00 with a term of 5 years (subject to the Mortgage
Loan Extension Privilege), will provide for payments of interest only for a
period of 24 months after Mortgage Loan Closing and thereafter payments of
principal based upon a 25-year amortization period using an annual rate of
interest of 10 percent, and interest with an actual annual interest rate of
3.25% over 30-day LIBOR adjusted monthly, (ii) the Gap Loan, which Gap Loan
shall be in the maximum amount of $2,064,000.00, have a maturity date not to
exceed 18 months from the date of the Gap Loan Closing and provide for payments
of interest only until such maturity; and (iii) the TIF Advance Loan which shall
be in the maximum amount of $1,519,000.00, provided for payments of interest at
a maximum rate of 8.75% (compounded through December 31, 1998 and subject to
adjustment on June 1 in the years 2000, 2003, 2006 and 2009 to 250 basis points
over the three year Treasury Constant Maturities Rate) until June 1, 2001 and
thereafter semi-annual payments of principal and interest sufficient to fully
amortize the loan over a 12 1/2 year period ending on June 1, 2012.
B. General Partner is specifically authorized, for and on behalf of the
Partnership, to execute the Loan Documents, the Reimbursement Agreement, the
Third Mortgage, the TIF Loan Documents and the Gap Loan Documents; the form and
substance of which shall be subject to the Consent of Special Limited Partner.
Subsequent to the execution of such documents, General Partner is, subject to
the limitations set forth in this Agreement, specifically authorized, for and on
behalf of the Partnership, to execute such other documents as General Partner
deems necessary in connection with the Mortgage Loan, the Third Mortgage, the
TIF Advance Loan, and/or Gap Loan provided that such documents are consistent
with the terms of the original Loan Documents, the Third Mortgage, TIF Loan
Documents or the Gap Loan Documents, as the case may be, and with the provisions
and restrictions contained in this Agreement. To the extent that any such
document is inconsistent with the terms of the original Loan Documents, the
Third Mortgage, the TIF Loan Documents, the Gap Loan Documents or this
Agreement, General Partner may execute such document only with the prior Consent
of Special Limited Partner.
C. The General Partner and the Partnership shall be bound by the terms of
the Loan Documents, the Reimbursement Agreement, the Third Mortgage, the TIF
Loan Documents and the Gap Loan Documents. Any incoming General Partner shall
as a condition of receiving any interest in the Partnership agree to be bound by
the Loan Documents, the Reimbursement Agreement, the Third Mortgage, the TIF
Loan Documents, and the Gap Loan Documents. Upon any dissolution of the
Partnership or any transfer of the Project while the Mortgage Loan, the TIF
Advance Loan or the Third Mortgage is outstanding, no title or right to the
possession and control of the Project and no right to collect the revenues
therefrom shall pass to any Person who is not, or does not become, bound in a
manner satisfactory to the Lender, to the Loan Documents, the Gap Loan
Documents, the TIF Loan Documents and the provisions of this Agreement. The
Loan Documents, the TIF Loan Documents and the Gap Loan Documents shall be
binding upon and shall govern the rights and obligations of the Partners, their
heirs, executors, administrators, successors and assigns as long as the Mortgage
Loan or Gap Loan, as the case may be, is outstanding.
D. Subject to the terms of the Loan Documents, the TIF Loan Documents the
Third Mortgage, and the other Project Documents, the Partnership may refinance
the Mortgage Loan, including any required transfer or conveyance of the
Partnership assets for security or mortgage purposes, may execute mortgages,
notes, and any other documents necessary for such a refinancing; provided,
however, that the terms of any such refinancing must receive the Consent of
Special Limited Partner, to be withheld or granted in Special Limited Partner's
sole and absolute discretion, before such transaction shall be binding on the
Partnership.
E. In the event the Partnership desires to exercise the Mortgage Loan
Extension Privilege but has insufficient funds available from Partnership
Reserves and Operating Deficit Loans to pay down the Mortgage Loan to the debt
service coverage ratio required to obtain such extension, the General Partner
shall have the option of making a Voluntary General Partner Loan to the
Partnership for the purpose of paying down the Mortgage Loan to achieve such
debt service coverage ratio; provided, however, if the General Partner elects
not to make such Voluntary General Partner Loan for any reason, the Investor
Limited Partner shall have option of making an Investor Limited Partner Loan for
the purpose of enabling the Partnership to so pay down the Mortgage Loan (a
"Debt Service Coverage Loan"). A Debt Service Coverage Loan shall be treated as
an Investor Limited Partner Loan for all purposes of this Agreement.
F. In the event that the Mortgage Loan is not a Nonrecourse Debt as of
December 31, 2000, the General Partner shall pay the Investor Limited Partner a
$50,000 fee on December 31, 2000 and, subsequently, on each December 31st if the
Mortgage Loan is not a Nonrecourse Debt as of each such payment date.
Section 3.3 Rehabilitation.
General Partner is specifically authorized, for and on behalf of the
Partnership, to execute the Development Agreement, and the Construction and
Design Contract.
Section 3.4 Management and Disposition.
A. The execution and delivery of the Management Agreement by the
Partnership is hereby authorized, ratified and approved. The General Partner is
hereby authorized, for and on behalf of the Partnership, to execute the
Incentive Partnership Management Agreement.
B. The Partnership may not sell all or any portion of or an interest in
the Project nor enter into a contract relating to any such sale without the
prior Consent of Special Limited Partner, which Consent may be withheld or
granted in Special Limited Partner's sole and absolute discretion. All
documents to be executed by the Partnership with respect to any such sale are
subject to the prior review of and Consent by Special Limited Partner.
SECTION 4: PARTNERS AND CAPITAL ACCOUNTS
Section 4.1 General Partner
General Partner of the Partnership is HRI-▇▇▇▇▇▇. Its address and Capital
Contribution are set forth in the Schedule.
Section 4.2 Limited Partners
A. Amerus-Blackstone, L.L.C. and AmerUs Management, Inc. are hereby
admitted into the Partnership as Investor Limited Partner and Special Limited
Partner, respectively, of the Partnership; their addresses and Capital
Contributions are set forth in the Schedule. The payment of their Capital
Contributions is governed by Section 5.1.
B. The Withdrawing Limited Partner hereby withdraws from the Partnership
as a Limited Partner and acknowledges that the Withdrawing Limited Partner has
no further interest in or claims against the Partnership in respect of the
Withdrawing Limited Partner's Limited Partnership Interest or otherwise and
shall not be considered a Limited Partner for purposes of this Agreement.
Section 4.3 Partnership Capital and Capital Accounts
A. The capital of the Partnership shall be the aggregate amount of the
cash, the Gross Asset Value of property and the value of any services
contributed by General Partner and Investor Limited Partner as set forth in the
Schedule. Except as specifically set forth herein, no Partner shall have any
right to make voluntary Capital Contributions to the Partnership. No interest
shall be paid by the Partnership on any Capital Contribution to the Partnership.
The Schedule shall be amended from time to time to reflect the withdrawal or
admission of Partners, any changes in the Partnership Interests held by a
Partner arising from the Transfer of a Partnership Interest to or by such
Partner, and any change in the amounts to be contributed or agreed to be
contributed by any Partner and the General Partner shall make all requisite
filings with any applicable Governmental Authority to reflect such matters.
B. An individual Capital Account shall be established and maintained for
each Partner, including any additional or Substitute Partner who shall hereafter
receive an interest in the Partnership in accordance with the terms of this
Agreement. The Capital Account of each Partner shall be maintained in
accordance with the following provisions:
(i) To each Partner's Capital Account there shall be credited such
Partner's Capital Contributions, such Partner's distributive share of
Profits, and any items in the nature of income or gain that are specially
allocated pursuant to Section 6, and the amount of any Partnership
liabilities that are assumed by such Partner or that are secured by any
Partnership Property distributed to such Partner;
(ii) To each Partner's Capital Account there shall be debited the
amount of cash and the Gross Asset Value of any Partnership Property
distributed to such Partner pursuant to any provision of this Agreement,
such Partner's distributive share of Losses, and any items in the nature of
expenses or losses that are specially allocated pursuant to Section 6, and
the amount of any liabilities of such Partner that are assumed by the
Partnership or that are secured by any property contributed by such Partner
to the Partnership.
In the event that the Gross Asset Values of Partnership assets are adjusted
pursuant to this Agreement, the Capital Accounts of all Partners shall be
adjusted simultaneously to reflect the aggregate net adjustment as if the
Partnership recognized gain or loss equal to the amount of such aggregate net
adjustment.
C. The original Capital Account established for any Substitute Partner
shall be in the same amount as, and shall replace, the adjusted Capital Account
of the Partner which such Substitute Partner succeeds, and, for the purposes of
this Agreement, such Substitute Partner shall be deemed to have made the Capital
Contribution, to the extent actually paid in, of the Partner which such
Substitute Partner succeeds. To the extent a Substitute Partner receives less
than 100% of the Partnership Interest of a Partner, such Substitute Partner's
Capital Account and Capital Contribution shall be in proportion to the
Partnership Interest such Substitute Partner receives, and the Capital Account
and Capital Contribution of the Partner who retains a partial interest in the
Partnership shall continue, and not be replaced, in proportion to the
Partnership Interest such Partner retains.
D. The foregoing provisions and the other provisions of this Agreement
relating to the maintenance of the Capital Accounts are intended to comply with
the Allocation Regulations, and shall be interpreted and applied in a manner
consistent with such Allocation Regulations. In the event that General Partner
determines that the Partnership is required to modify the manner in which the
Capital Accounts, or any debits or credits thereto, are computed in order to
comply with the Allocation Regulations, General Partner shall, with the Consent
of the Special Limited Partner, make such modification, in such a manner as to
cause the Partners' Capital Accounts to be maintained in such manner as may be
necessary to give effect to the manner the Partners have agreed to share
Distributions as provided in Section 6.2 and to maximize the amount of Historic
Rehabilitation Credit allocable to the Limited Partners. General Partner shall
adjust the amounts debited or credited to Capital Accounts with respect to (i)
any property contributed to the Partnership or distributed to the Partners, and
(ii) any liabilities that are secured by such contributed or distributed
property that are assumed by the Partnership or the Partners, in the event
General Partner shall determine such adjustments are necessary or appropriate
pursuant to Section 1.704-1(b)(2)(iv) of the Allocation Regulations. Subject to
the provisions of Section 6.3C, General Partner also shall make any appropriate
modifications in the event unanticipated events might otherwise cause this
Agreement not to comply with the Allocation Regulations.
Section 4.4 Withdrawal of Capital.
A Partner shall not have the right to withdraw from the Partnership all or
any part of such Partner's Capital Contribution. No Partner shall have any
right to demand or receive property of the Partnership in return for such
Partner's Capital Contribution, except as may be specifically provided in this
Agreement. No Partner shall be entitled to demand a redemption or repurchase of
such Partner's Partnership Interest, except as may be specifically provided in
this Agreement. Any return of Capital Contributions to the Partners pursuant to
this Agreement shall be solely from Partnership assets, and General Partner
shall not be personally liable for any such return.
Section 4.5 Liability of Limited Partner
No Limited Partner shall be liable for any debts, liabilities, contracts,
or obligations of the Partnership. A Limited Partner shall be liable only to
make payments of its Capital Contributions as and when due hereunder and any
Subordinated Partner Loan, if and as required hereunder. After a Limited
Partner's Capital Contributions are fully paid and any Subordinated Partner
Loans are made, such Limited Partner shall not be required to make any further
Capital Contributions or payments or lend any funds to the Partnership.
Section 4.6 Additional Limited Partners
A. General Partner may admit additional Limited Partners only with the
Consent of Special Limited Partner, which Consent may be withheld or granted in
Special Limited Partner's sole and absolute discretion, and only in accordance
with the provisions of Section 11.
B. Any incoming Limited Partner shall, by execution of this Agreement and
as a condition of receiving any interest in the Partnership Property, agree to
be bound by the Project Documents to the same extent and on the same terms as
the other Limited Partners.
C. Upon the admission of any additional Limited Partners, an amendment to
this Agreement reflecting such admission, shall, to the extent required by law,
be filed with the Filing Office and/or any other appropriate Governmental
Authority. Such amendment, if required, shall amend the Schedule to reflect the
names, addresses and Capital Contributions of such additional Limited Partners,
and shall set forth the agreement of such additional Limited Partners to be
bound by all the provisions of this Agreement.
SECTION 5: CAPITAL CONTRIBUTIONS OF INVESTOR LIMITED PARTNER AND
SPECIAL LIMITED PARTNER; OPERATING DEFICIT LOANS; INVESTOR
LIMITED PARTNER LOANS; LETTER OF CREDIT; REPURCHASE RIGHT;
DEFICIT RESTORATION OBLIGATIONS
Section 5.1 Capital Contributions of Investor Limited Partner and
Special Limited Partner
A. Subject to the provisions of Sections 5.3 and 5.4, Investor Limited
Partner's Capital Contribution shall be in the amount of $2,810,000.00, which
Capital Contribution will be paid in two installments as follows:
(i) The sum of $1,967,000.00 (the "First Installment") shall be paid
after satisfaction of all of the Admission Date Conditions, as set forth on
Exhibit A, which Admission Date Conditions will be satisfied on or before the
Admission Date.
(ii) The sum of $843,000.00, which sum is subject to reduction as
provided in Section 5.4 and/or under the proviso in this Section 5.1A(ii) (as so
reduced the "Second Installment") shall be paid 10 days after the date by which
all of the following events shall have occurred: (1) either the Temporary
Certificate of Occupancy or Certificate of Occupancy has been issued; (2) the
written determination by the Accountants of the aggregate amount of the Historic
Rehabilitation Credit; (3) the Cash Collateral Fund has been funded or will be
funded contemporaneously therewith; (4) either a final Part III Historic
Application issued by the Department of the Interior with respect to the
Historic Rehabilitation Credit, or both (x) a certificate of General Partner in
which General Partner certifies that General Partner believes that a Part III
Historic Application with respect to the Project will be issued by the
Department of the Interior in customary course and that General Partner intends
to include the Historic Rehabilitation Credit in the Partnership's tax return
for the year in which such certificate is issued, or has included the Historic
Rehabilitation Credit in the Partnership's tax return for an earlier year, and
(y) a certificate of HCI, reasonably satisfactory to Special Limited Partner, to
the effect that in HCI's professional judgement the Project has been completed
in accordance with the conditions relating to the Historic Rehabilitation Credit
and that a Part III Historic Application with respect to the Project will be
issued by the Department of the Interior in customary course; and (5) all of the
matters and conditions described in Section 5.2 have been satisfied.
Notwithstanding the foregoing, (a) the amount of the Second Installment shall in
no event exceed the difference between $3,420,500.00 less the sum of the First
Installment, the aggregate amount of any draws on the Letter of Credit and/or
the TIF Letter of Credit, and the aggregate amount of any Subordinated Partner
Loan made by the Investor Limited Partner, and (b) if the requirement of Section
5.1A(ii)(1) is satisfied by the delivery of a Temporary Certificate of
Occupancy, then Investor Limited Partner shall have the right to fund a portion
of the Second Installment in an amount equal to the reasonably anticipated costs
yet to be incurred by the Partnership in obtaining a Certificate of Occupancy
into an escrow account held by an escrow agent and pursuant to escrow
instructions reasonably satisfactory to Special Limited Partner and General
Partner. The amounts held in such escrow account shall be released to the
Partnership upon completion of all such work and upon the issuance of a
Certificate of Occupancy.
(iii) Notwithstanding the foregoing but subject to Section 5.3 below,
Investor Limited Partner will have the right, at Investor Limited Partner's
election, but not the obligation, to pay all or a portion of the Second
Installment to obtain a release of the Letter of Credit, the TIF Letter of
Credit and/or to any third party to which the Partnership then owes an
obligation which is then due and payable or to make any payment to any Person
which would cure any Material Default, provided that Investor Limited Partner
has given General Partner at least 5 days' prior notice of Investor Limited
Partner's intent to make such payment and General Partner has failed, within 5
days after such notice, to contest, settle, or otherwise satisfy or discharge
the obligation which underlies the payment that Investor Limited Partner has
notified General Partner of, in a manner which prevents the Person to which such
obligation is owed from enforcing such obligation or otherwise harming the
Partnership with respect to such obligation; any such payment made by Investor
Limited Partner will be deemed to be made on behalf of the Partnership and, to
the extent of such payment, the Second Installment will be deemed to have been
paid. No such payment by Investor Limited Partner will be deemed to be a waiver
of any Material Default or will relieve General Partner of any of General
Partner's obligations under this Agreement, including, but not limited to,
matters which were cured by such payment.
B. Special Limited Partner's Capital Contribution shall be in the amount
of $100.00 and shall be paid to the Partnership in full in cash on the Admission
Date.
Section 5.2 Conditions to Payment of Second Installment
The following are conditions precedent (which must, in any event, occur on
or before the Completion Date) to payment of the Second Installment by Investor
Limited Partner:
A. All of the conditions precedent to the Admission Date have been and
remain satisfied.
B. No Material Default has occurred, and no event has occurred which with
the passage of time or the giving of notice would constitute a Material Default,
and neither Investor Limited Partner nor Special Limited Partner has delivered a
notice of a Material Default which is currently being contested by General
Partner.
C. The Temporary Certificate of Occupancy Date has occurred and the
Project is not subject to any liens, claims or encumbrances other than the Deed
of Trust, or other matters set forth in the title insurance policy delivered to
Special Limited Partner at the Mortgage Loan Closing pursuant to this Agreement.
D. Intentionally Omitted.
E. General Partner has delivered a written certification to Investor
Limited Partner (a "Payment Certificate") in the form attached to this Agreement
as Exhibit C.
F. General Partner must deliver each of the following to Special Limited
Partner:
(i) A copy of the Temporary Certificate of Occupancy, together with
evidence that the nature of the work remaining to be done is of a nature which
would not impair the permanent occupancy of any portion of the Project, which
evidence is reasonably satisfactory to Special Limited Partner.
(ii) A copy of a lien waiver executed by the Contractor, dated not
more than 30 days prior to the date on which the Second Installment is due;
which lien waiver must show that all amounts due through the date of such waiver
have been paid.
(iii) A "date-down" endorsement to the title insurance policy
required under this Agreement, which is to be issued concurrently with payment
of the Second Installment, dating the policy as of the date on which the Second
Installment is paid, which endorsement must not contain any exception relating
to any liens of record not previously set forth on the title insurance policy
issued at the Mortgage Loan Closing.
(iv) An estoppel certificate, dated not more than thirty (30) days
before the date on which the Second Installment is due, from the City that the
Redevelopment Agreement has not been modified and is in full force and effect
(or if there have been modifications, that the Redevelopment Agreement is in
full force and effect as modified and setting forth the modifications), and
whether, to the best knowledge of the City, the Partnership is or is not in
default of the Redevelopment Agreement, and, if so, specifying the default;
provided, however, in the event the City fails to provide such estoppel
certificate, the General Partner shall provide a evidence that the City received
a written request for such estoppel certificate and a representation by the
General Partner that the City failed to respond to such request within twenty
(20) days and that the Redevelopment Agreement has not been modified, is in full
force and effect and that the Partnership is not in default under the terms
thereof.
(v) An estoppel certificate from the Bank that the TIF Loan Documents
have not been modified and are in full force and effect (or if there have been
modifications, that the TIF Loan Documents are in full force and effect as
modified and setting forth the modifications), and whether, to the best
knowledge of the City, the Partnership is or is not in default of the TIF Loan
Documents.
(vi) An estoppel certificate from the Manager that the Management
Agreement has not been modified an is in full force and effect (or there has
been modification, that the Management Agreement is in full force and effect as
modified and setting forth the modifications), whether or not there has been a
default under the terms of the Management Agreement (and, if so, specifying the
default), and a representation that the Hotel is open for business to the
public.
(vii) An estoppel certificate, dated not more than 30 days before the
date on which the Second Installment is due, from the General Partner, in the
form attached to this Agreement as Exhibit D.
(viii) Evidence of written instructions from the Partnership
delivered to the Lender contemporaneously with the payoff of the Gap Loan and
requiring the original Letter of Credit to be marked "CANCELLED" by Lender and
delivered to Investor Limited Partner.
G. If requested by Special Limited Partner, an opinion of the
Partnership Counsel, or such other counsel satisfactory to Special Limited
Partner, relating to the authority of General Partner, and any Affiliate of
General Partner which may be providing services to the Partnership, and to the
enforceability of this Agreement and the other Project Documents, which opinion
must be reasonably satisfactory to Special Limited Partner. The cost of such
opinion will be borne by the Partnership.
H. If requested by Special Limited Partner, an opinion of the
Partnership Counsel, or such other tax counsel satisfactory to Special Limited
Partner, which shall include opinions relating to the federal income tax
classification of the Partnership, the availability of the Historic
Rehabilitation Credit, the allocation of 99% of such credit to the Limited
Partners in accordance with this Agreement, and the status of Limited Partners
as "limited partners" under the Act notwithstanding the taking of any action or
exercise of any and all rights, approvals and directives by Limited Partner in
accordance with the terms of this Agreement, which opinion must be reasonably
satisfactory to Special Limited Partner. The cost of such opinion will be borne
by the Partnership.
I. A certificate, in form and substance approved by the Special
Limited Partner, from the Developer that the Project has been developed in
accordance with the Plans and Specifications and the Tax Financing Documents.
J. The financial statements of General Partner (which need not be
audited), obtained at the expense of General Partner, dated no earlier than 90
days prior to the date on which the Second Installment is due (or if dated more
than 90 days prior to such date, in addition, a certificate of General Partner
that there has been no material adverse change to General Partner's financial
condition since the date of such financial statements).
K. The financial statements of HRI (which need not be audited),
obtained at the expense of HRI, dated no earlier than 90 days prior to the date
on which the Second Installment is due (or if dated more than 90 days prior to
such date, in addition, a certificate of HRI that there has been no material
adverse change to HRI's financial condition since the date of such financial
statements), showing that there has been no material adverse change from the
financial statements submitted to Special Limited Partner in connection with
Investor Limited Partner's entrance into this Agreement and also showing that
HRI's net worth is equal to or greater than $4,000,000.00 determined in
accordance with GAAP.
L. Insurance certificates evidencing all insurance policies required
under this Agreement and/or the Management Agreement are paid for and in full
force and effect as of the date on which the Second Installment is due.
M. Copies of such other documents, permits, certificates, reports or
other items relating to the Project as Special Limited Partner may reasonably
request.
Section 5.3 Adjuster Provisions: Generally; Completion Adjuster
A. The parties acknowledge that the amount of Investor Limited Partner's
Capital Contribution is based on an amount of Historic Rehabilitation Credit
allocable to Investor Limited Partner under the terms of this Agreement of
$3,193,740.00. If the amount of the Historic Rehabilitation Credit allocable to
Investor Limited Partner under the terms of this Agreement is less or greater
than $3,193,740.00, the provisions of Section 5.4 shall apply; provided,
however, that in the event a Negative Historic Adjustment results in a reduction
of Investor Limited Partner's Capital Contribution Installments or an offset to
any amounts otherwise distributable or payable to the General Partner or to
General Partner's Affiliates or a payment by General Partner to Investor Limited
Partner pursuant to Sections 5.4 or 5.13, as the case may be, then such payment
shall nevertheless be deemed for all purposes to be a return of Investor Limited
Partner's Capital Contribution Installments, in the inverse order in which such
Installments were made. In the event any payments by the General Partner to the
Investor Limited Partner pursuant to Sections 5.3, 5.4 or 5.13, as the case may
be, is includable in the Investor Limited Partner's gross income for Federal
income tax purposes, then the amount of any such payment(s) by the General
Partner to the Investor Limited Partner shall be increased by 53.85%.
B. If the Placed-In-Service Date has not occurred on or prior to December
31, 1999, General Partner shall indemnify the Investor Limited Partner (for the
General Partner's failure to timely complete the Project) in an amount (the
"Negative Completion Adjuster") equal to the sum of (i) the product of 20%
multiplied by the First Installment, plus (ii) interest on the amount specified
in the preceding clause (i) at an annual rate equal to the lesser of the
Designated Interest Rate plus 7%, or the highest rate permitted by law from the
December 31, 1999 until such Negative Completion Adjuster is paid in full; which
amount shall be paid by General Partner, in cash, on or before January 31, 2000;
provided, however, that for all purposes of this Agreement, any amount so paid
to Investor Limited Partner by General Partner shall not constitute a loan nor
contribution of capital to the Partnership by General Partner, and General
Partner shall not be entitled to receive any repayment or other compensation or
consideration with respect to such amount. If the Placed-In-Service Date has
occurred on or before December 31, 1998, the Investor Limited Partner shall make
an additional Capital Contribution (the "Positive Completion Adjuster") to the
Partnership in an amount equal to $100,000.00; which amount shall be paid by the
Investor Limited Partner, in cash, on or before January 31, 1999 and, upon
receipt by the Partnership, shall be used and applied by the Partnership to pay
down on the Subordinate Partner Loans. The Investor Limited Partner shall have
the right to offset any amounts due from Investor Limited Partner under the
Second Installment or its Subordinated Partner Loan against any Negative
Completion Adjuster due from the General Partner to Investor Limited Partner
pursuant to this Section 5.3B; provided, however, for purposes of all alloca-
tions, distributions and payments under this Agreement, the Investor Limited
Partner shall be treated as having made the full amount of its Second
Installment and Subordinated Partner Loan notwithstanding such offset and such
offset shall not constitute a loan nor contribution of capital to the
Partnership by General Partner, nor shall the General Partner be entitled to
receive any repayment or other compensation or consideration with respect to
such offset amount.
Section 5.4 Historic Rehabilitation Credit Adjuster
Notwithstanding anything to the contrary contained herein, if, for any
reason other than a change in the law having a retroactive impact on the tax
benefits allocable to Investor Limited Partner hereunder, (x) the written
determination by the Accountants of the aggregate amount of the Historic
Rehabilitation Credit is such that, or (y) the Partnership shall file a federal
income tax return showing that, or (z) there shall be a Final Determination
that, the aggregate amount of Historic Rehabilitation Credit allocated to
Investor Limited Partner is an amount less or greater than $3,193,740.00 (such
determination shall be referred to herein as the "Historic Credit
Determination"), then the Accountants shall calculate the difference between the
aggregate amount of Historic Rehabilitation Credit projected to be allocated to
Investor Limited Partner and the amount in fact allocated; if the aggregate
amount of Historic Rehabilitation Credit projected to be allocated to Investor
Limited Partner is greater than the amount in fact allocated, such amount shall
be referred to as the "Negative Historic Credit Difference"; if the aggregate
amount of Historic Rehabilitation Credit projected to be allocated to Investor
Limited Partner is less than the amount in fact allocated, such amount shall be
referred to as the "Positive Historic Credit Difference." In the event a
Historic Credit Determination is made that results in either a Negative Historic
Adjustment or a Positive Historic Adjustment, all subsequent Historic Credit
Determinations will be made on the basis of the initial amount of the Historic
Rehabilitation Credit allocated to the Investor Limited Partner as adjusted for
any prior Negative Historic Adjustment(s) and Positive Historic Adjustment(s).
(i) If there is a Negative Historic Credit Difference, the Negative
Historic Credit Difference will be multiplied by 92.4% and the resulting
product shall be the "Negative Historic Adjustment."
(ii) If there is a Positive Historic Credit Difference, the Positive
Historic Credit Difference will be multiplied by 88% and the resulting
product shall be the "Positive Historic Adjustment."
(iii) If at the time that a Negative Historic Adjustment is
determined Investor Limited Partner has not paid all of the Installments of
Investor Limited Partner's Capital Contributions, then the amount of the
remaining Capital Contribution Installment(s) to be paid by Investor
Limited Partner shall be reduced by the Negative Historic Adjustment. If
the Negative Historic Adjustment exceeds the aggregate of such remaining
Capital Contribution Installments, such excess shall constitute Excess
Adjustment and shall be repaid to Investor Limited Partner in accordance
with the terms of Section 5.13.
(iv) If at the time that a Negative Historic Adjustment is determined
Investor Limited Partner has paid in all of Investor Limited Partner's
Capital Contribution Installments, then the entire amount of such Negative
Historic Adjustment shall constitute an Excess Adjustment and shall be
repaid to Investor Limited Partner in accordance with the terms of Section
5.13.
(v) If at the time that a Positive Historic Adjustment is determined
Investor Limited Partner has not paid all of the Installments of Investor
Limited Partner's Capital Contributions, then the amount of the Second
Installment shall be increased by the amount of the Positive Historic
Adjustment.
(vi) If at the time that a Positive Historic Adjustment is determined
Investor Limited Partner has paid all of Investor Limited Partner's Capital
Contribution Installments, then Investor Limited Partner will make an
additional Capital Contribution to the Partnership in the amount of the
Positive Historic Adjustment within 30 days after Special Limited Partner's
receipt of notice from General Partner that such amount is payable and
documentation evidencing same.
Section 5.5 Balloon Adjuster
If Recapture Event occurs as a result of a foreclosure (or similar
event) of the Mortgage Loan, the TIF Advance Loan or any refinancing thereof, on
or before the end of the five year period beginning on the Place-in-Service
Date, General Partner shall indemnify the Limited Partners for such Recapture
Event in an amount (the "Balloon Adjuster") equal to the sum of (i) the amount
of Historic Rehabilitation Credit which is required to be recaptured by the
Limited Partners (i.e. 20% for each year less than 5 full years of the Historic
Rehabilitation Credit properly allocated to the Limited Partners) in connection
with such Recapture Event, plus (ii) any additional tax, penalties and interest
incurred by the Limited Partners as a result of such Recapture Event. In the
event the payment of the Balloon Adjuster by the General Partner is includible
in the Limited Partners' gross income for federal income tax purposes, then the
amount of such payment shall be increased by 53.85%. The Balloon Adjuster shall
be due and payable, in cash, within 30 days after such Recapture Event.
Section 5.6 IRS Claims
A. In the event that a claim is made by the IRS (a "Claim") upon audit
which, if successful, would result in an adjustment to the Capital Contributions
of Investor Limited Partner or any payments pursuant to Sections 5.3, 5.4 or
5.13, General Partner, in General Partner's capacity as the TMP, shall, within
30 days after receiving notice of such Claim, notify Investor Limited Partner
and Special Limited Partner of the Claim (such notice being referred to as a
"Claim Notice") and request that Investor Limited Partner notify the Partnership
of Investor Limited Partner's intention either to contest such Claim or to
accept the same. If Investor Limited Partner elects to contest such Claim, the
TMP shall take such action in contesting such Claim on behalf of the Partnership
and Investor Limited Partner as the TMP reasonably deems necessary or as
directed by Special Limited Partner. In such event, all third party costs and
expenses incurred by the TMP in connection with such matter shall be borne by
the Partnership and/or the Partners in accordance with the provisions of Section
7.9. The failure of Special Limited Partner, within 30 days after the date of
the Claim Notice, to notify the Partnership of Investor Limited Partner's
intention to contest such Claim shall be deemed to be a decision to accept the
same.
B. In the event that Investor Limited Partner elects to accept such
Claim, General Partner may nevertheless contest the Claim by appropriate
proceedings, provided, however, that (i) General Partner elects to contest such
Claim, and in fact commences such contest, within any applicable period of
limitations, (ii) prior to contesting any such Claim, General Partner delivers
to Special Limited Partner security, satisfactory to Special Limited Partner,
securing General Partner's potential obligations under Section 5.3, 5.4, 5.13
and this Section 5.6, (iii) General Partner diligently prosecutes such contest,
and (iv) if, following the contest of such Claim by General Partner, all or a
portion of the Claim is sustained in a Final Determination, then there shall be
added to the adjustments referred to in Section 5.4, an amount equal to the
interest, penalties, or any other amount assessed against Investor Limited
Partner for the period commencing on the date of the Claim Notice and ending on
the date of such Final Determination.
C. If, following a decision by General Partner to contest a Claim under
Section 5.6B above, 50% or more of the tax deficiency amount specified in the
Claim is sustained in a Final Determination, the costs and expenses of
contesting the Claim shall be borne solely by General Partner. If such Final
Determination results in less than 50% of the tax deficiency amount specified in
the Claim being upheld, the costs and expenses of contesting the Claim shall be
borne by the Partnership and/or the Partners in accordance with the provisions
of Section 7.9.
Section 5.7 Project Cost Overruns
In the event that the cost of construction, development, and Rehabilitation
of the Project exceeds the total project cost set forth in the Development
Budget, General Partner shall pay to the Partnership the amount of such excess.
Such payment or payments shall be made at such times as may be necessary to
assure that the costs of construction, development, and Rehabilitation of the
Project are timely paid. Except as provided in this Section 5.7, such payments
by General Partner shall not constitute loans nor contributions of capital to
the Partnership by General Partner, and General Partner will not be entitled to
receive any repayment or other compensation or consideration with respect to
such amounts. Notwithstanding the foregoing, to the extent that Investor
Limited Partner's Capital Contributions are increased under Section 5.4 as a
result of the cost of construction, development, and Rehabilitation of the
Project exceeding the total project cost set forth in the Development Budget,
then the Partnership will reimburse General Partner for amounts paid by General
Partner under this Section 5.7, or will reimburse a Development Guarantor for
amounts paid by such Development Guarantor under the Development Guaranty
Agreement, upon receipt by the Partnership of Investor Limited Partner's
increased Capital Contribution. If the increase in Investor Limited Partner's
Capital Contribution is less than the aggregate of the amounts paid by General
Partner under this Section 5.7 and amounts paid by the Development Guarantors
under the Development Guaranty Agreement, then the proceeds of Investor Limited
Partner's increased Capital Contribution will be allocated between General
Partner and the Development Guarantors as determined by General Partner;
provided, however, the Limited Partners shall have no duty to determine the
reasonableness of such allocation or oversee the application of such funds by
the General Partner to the General Partner and/or the Development Guarantors.
Section 5.8 Operating Deficits and Operating Deficit Loans; Use of
Operating Deficit Reserve; and Cash Collateral Fund
A. (i) If at any time during the Initial Operating Period, the
Partnership requires funds to eliminate an Operating Deficit, then General
Partner shall use funds from the Operating Reserve, as may be necessary to
eliminate such Operating Deficit, until the Operating Reserve is depleted.
(ii) If, at any time during the Initial Operating Period after the
Operating Reserve is depleted, the Partnership requires funds to eliminate an
Operating Deficit, then such shortfall shall be funded by General Partner making
an Operating Deficit Loan to the Partnership. Such Operating Deficit Loan shall
be funded 30% from the Cash Collateral Fund (to the extent funds are available),
and 70% from General Partner (provided that to the extent that funds are not
available in the Cash Collateral Fund to pay the full 30% portion of such
shortage, General Partner will pay the difference as necessary, subject to the
Operating Deficit Loan Maximum). Notwithstanding the foregoing, General Partner
shall not be required to make an Operating Deficit Loan to the Partnership to
the extent that the outstanding principal amount of Operating Deficits Loans
equals or exceeds the Operating Deficit Loan Maximum. To the extent that the
principal amount of any Operating Deficit Loan is repaid to General Partner, the
amount of such repayment shall be credited against the aggregate amount of the
outstanding advances made by General Partner under this Section 5.8A(ii), and
the amount so repaid shall be available again for future Operating Deficit Loans
during the Initial Operating Period (e.g. the Operating Deficit Loans will be
"revolving" loans which have a maximum outstanding principal amount of the
Operating Deficit Loan Maximum). General Partner acknowledges that the maximum
aggregate principal amounts of the Operating Deficit Loans under this Section
5.8A(ii) will remain at the Operating Deficit Loan Maximum throughout the
Initial Operating Period.
(iii) In the event that during the Initial Operating Period the
Operating Reserve is depleted and General Partner fails to make an Operating
Deficit Loan as required under this Section 5.8A, then Special Limited Partner
may withdraw the amount which General Partner was required to loan to the
Partnership as a Operating Deficit Loan from the Cash Collateral Fund and use
such amounts to fund such Operating Deficit. No such withdrawal from the Cash
Collateral Fund by Special Limited Partner will be deemed to cure General
Partner's default with respect to the failure to make an Operating Deficit Loan,
and General Partner shall be required, in addition to all other obligations
under this Agreement, to restore to the Cash Collateral Fund the amount so
withdrawn, together with interest on such amount at the Designated Interest Rate
plus 7% from the date so withdrawn by Special Limited Partner until so restored.
B. In the event (i) during the Initial Operating Period the Operating
Reserve and the Cash Collateral Fund are each depleted and General Partner
either fails to make an Operating Deficit Loan or is not required to make an
Operating Deficit Loan pursuant to Section 5.8A, or (ii) there is an Operating
Deficit after the expiration of the Initial Operating Period, Investor Limited
Partner may, but shall not be obligated to, make an Investor Limited Partner
Loan to the Partnership.
Section 5.9 No Third-Party Rights in Operating Deficit Loans
The obligation of General Partner to make Operating Deficit Loans pursuant
to Section 5.8 is for the benefit of the Partnership and the Partners and shall
not inure to the benefit of any creditor of the Partnership other than a
Partner, notwithstanding any pledge or assignment by the Partnership of this
Agreement or any rights hereunder.
Section 5.10 No Third-Party Rights in Capital
The obligations or rights of the Partnership or of the Partners to make or
require any Capital Contribution under this Agreement shall not grant any rights
to, or confer any benefits upon, any Person who is not a Partner. The making of
a nonrecourse loan to the Partnership shall not make the lender a Partner.
Section 5.11 Letters of Credit.
Investor Limited Partner shall cause the Letter of Credit to be issued in
favor of the Lender at the Gap Closing Loan Closing and the TIF Letter of Credit
to be issued to the Bank at the TIF Advance Loan Closing. The Partnership shall
reimburse the Investor Limited Partner for the reasonable costs of obtaining the
Letter of Credit and the TIF Letter of Credit. In the event that the Lender
draws upon the Letter of Credit or the Bank draws on the TIF Letter of Credit,
General Partner shall immediately reimburse Investor Limited Partner (or, if
such Letter of Credit or the TIF Letter of Credit, as applicable, was issued at
the request of an Affiliate of Investor Limited Partner, such Affiliate), for
the amount so drawn together with any liability or cost which Investor Limited
Partner or such Affiliate may incur with respect to such draw. The Letter of
Credit shall be cancelled and released upon General Partner and Investor Limited
Partner making the Subordinated Partner Loans to the Partnership. The TIF
Letter of Credit shall be cancelled and released upon the later of the date of
the issuance of the Certificate of Occupancy or the date the Hotel is open for
business to the public. General Partner's obligations under this Section 5.11
will be secured by the Development Guaranty Agreement, the Development Fee Note
Assignment, and the General Partner Pledge.
Section 5.12 Limited Partners' Right to Require Repurchase
A. In the event (a "Repurchase Event") that (i) the Partnership is in
default under the Mortgage Loan and the Lender has accelerated the Mortgage Loan
prior to the later of the date the Mortgage Loan becomes a Nonrecourse Liability
or prior to issuance of the Certificate of Occupancy, or (ii) the Temporary
Certificate of Occupancy Date does not occur on or before June 30, 1999, or
(iii) the Certificate of Occupancy Date and all conditions set forth in Section
5.2 do not occur on or before December 31, 1999, or (iv) the Negative Historic
Credit Difference is greater than 15% of the Historic Rehabilitation Credit to
be allocated to Investor Limited Partner set forth in Section 5.4A, or (v) the
Partnership is in default under the Management Agreement prior to the later of
date the Mortgage Loan becomes a Nonrecourse Liability or the date of issuance
of the Temporary Certificate of Occupancy, then General Partner shall, within 30
days after the occurrence of such Repurchase Event, notify Investor Limited
Partner and Special Limited Partner of such event. If such notice is required
by a Repurchase Event described in clauses (i), (ii), (iii) or (iv), the Special
Limited Partner shall have the option to require General Partner to purchase the
Special Limited Partner's and the Investor Limited Partner's Partnership
Interests at a price equal to (x) the amount of the Capital Contribution which
such Limited Partners have made, plus (y) Subordinated Partner Loans (including
interest thereon) and other amounts loaned or advanced to the Partnership by the
Limited Partners, plus (z) any reasonable out of pocket costs or expenses
incurred by Investor Limited Partner or Special Limited Partner with respect to
this Agreement (including, without limitation, any penalties and interest
attributable to a recapture of the Historic Rehabilitation Credit), the
Partnership, the Project, or General Partner's repurchase of such Partnership
Interests. If such notice is required by a Repurchase Event described in clause
(v), the Special Limited Partner shall reasonably determine whether Manager may
seek to terminate the Management Agreement and shall notify General Partner of
such determination. If General Partner fails to provide Investor Limited
Partner and Special Limited Partner within 15 days of receipt of such notice
from the Special Limited Partner with (a) evidence reasonably satisfactory to
them that Manager will not terminate the Management Agreement, (b) evidence of
the Partnership's cure of such default, or (c) a copy of suit filed by the
Partnership challenging the alleged default described in clause (v) and evidence
of reasonable diligence in prosecuting such challenge, the Special Limited
Partner shall then have the option to require the General Partner to purchase
the Partnership Interests of Investor Limited Partner and Special Limited
Partner at the price set forth above; provided, however, if the General Partner
provides such evidence and pleadings relating to the prosecution of such
challenge and subsequently fails to diligently prosecute such challenge or does
not prevail on such challenge for any reason, the Special Limited Partner shall
then have the option to require the General Partner to purchase the Partnership
Interests of Investor Limited Partner and Special Limited Partner at the price
set forth above.
B. If either Investor Limited Partner or Special Limited Partner elects to
require General Partner to repurchase such Partner's Partnership Interest, such
Partner shall notify General Partner whereupon General Partner shall, within 30
days of receipt of such notice, pay Investor Limited Partner or Special Limited
Partner, as applicable, the purchase price in cash or immediately available
funds. Upon such payment by General Partner, Investor Limited Partner or
Special Limited Partner, as applicable, shall be released from any further
obligations under this Agreement, the Project Documents, or otherwise relating
to the Partnership or the Project, and, to the full extent permitted by law,
Investor Limited Partner and Special Limited Partner, and each of Investor
Limited Partner's and Special Limited Partner's Affiliates, shall be indemnified
by General Partner against any losses, judgments, liabilities, expenses and
amounts paid in settlement of any claims sustained by such Person in connection
with the Partnership or the Project.
Section 5.13 Repayment to Investor Limited Partner of Excess Adjustment
Any and all Excess Adjustments shall be repaid as provided in this Section
5.13. The Investor Limited Partner shall have the right to offset any or all of
the unpaid portion of the Second Installment and/or its Subordinated Partner
Loan up to the full amount of the Excess Adjustments. So long as there is any
Excess Adjustment outstanding, Distributions of Cash Flow to the General Partner
or its Affiliates will be allocated and distributed to Investor Limited Partner
and payments of the Developer Fee and/or payments on the Deferred Development
Note shall be applied in repayment of such Excess Adjustment prior to allocation
or distribution of any Cash Flow to General Partner or to General Partner's
Affiliates and or payments of the Developer Fee and/or payment on the Deferred
Development Note, until such time as funds have been so distributed or applied
to Investor Limited Partner under this Section in an amount equal to (i) the
Excess Adjustment, plus (ii) interest on such amount at a rate of 15% per annum
calculated from the date on which Investor Limited Partner's Capital
Contribution containing such amount was made until all of the Excess Adjustment
and all interest thereon is so repaid. Any amount so distributed or applied to
Investor Limited Partner under this Section shall be first applied to the
payment of interest, then to the payment of the Excess Adjustment. If the
Excess Adjustment and all interest thereon are not paid in full within 12 months
after the date on which such Excess Adjustment was determined, General Partner
shall pay to Investor Limited Partner the amount necessary to repay all amounts
then owing to Investor Limited Partner with respect to the Excess Adjustment and
all interest thereon and such payment by General Partner will be treated as an
Excess Adjustment Loan which will be repaid as provided in Section 6.2.
Section 5.14 Subordinated Partner Loans.
A. After the earlier of the date (i) the Gap Loan matures (other than by
reason of a default thereunder) or (ii) the Second Installment is made, and upon
satisfaction of the conditions precedent in Section 5.14B, the Investor Limited
Partner and the General Partner shall each lend funds to the Partnership (a
"Subordinated Partner Loan") up to the aggregate amount of $610,500.00 at any
time within 5 days after the General Partner gives notice to the Investor
Limited Partner, of the need for such funds to pay off the Gap Loan; provided,
however, the tender of such Subordinated Partner Loan by the Investor Limited
Partner to the Partnership, shall be conditioned on the receipt by the
Partnership of such required Subordinated Partner Loan from the General Partner.
The Investor Limited Partner's obligation to make a Subordinated Partner Loan
under this Section 5.14A shall be conditioned on the receipt by the Partnership
of the proceeds of the Subordinated Partner Loan to be made under this Section
by the General Partner. The General Partner's obligation to make a Subordinated
Partner Loan in excess of $115,000.00 under this Section 5.14A is conditioned on
AmerUs Life Insurance Company fulfilling its obligations under the Put Loan
Documents.
B. The following are conditions precedent (which must, in any event,
occur on or before June 30, 1999) to funding of the Subordinated Partner Loan by
Investor Limited Partner:
(i) All of the conditions precedent to the Admission Date have been
and remain satisfied.
(ii) No Material Default has occurred, and no event has occurred which
with the passage of time or the giving of notice would constitute a
Material Default, and neither Investor Limited Partner nor Special Limited
Partner has delivered a notice of a Material Default which is currently
being contested by General Partner.
(iii) General Partner must deliver each of the following to
Special Limited Partner:
(a) An estoppel certificate, dated not more than thirty (30)
days before the date on which the Second Installment is due, from the
City that the Redevelopment Agreement has not been modified and is in
full force and effect (or if there have been modifications, that the
Redevelopment Agreement is in full force and effect as modified and
setting forth the modifications), and whether, to the best knowledge
of the City, the Partnership is or is not in default of the
Redevelopment Agreement, and, if so, specifying the default; provided,
however, in the event the City fails to provide such estoppel
certificate, the General Partner shall provide a evidence that the
City received a written request for such estoppel certificate and a
representation by the General Partner that the City failed to respond
to such request within twenty (20) days and that the Redevelopment
Agreement has not been modified, is in full force and effect and that
the Partnership is not in default under the terms thereof.
(b) An estoppel certificate from the Bank that the TIF Loan
Documents have not been modified and are in full force and effect (or
if there have been modifications, that the TIF Loan Documents are in
full force and effect as modified and setting forth the
modifications), and whether, to the best knowledge of the City, the
Partnership is or is not in default of the TIF Loan Documents.
(c) An estoppel certificate from the Manager that the Management
Agreement has not been modified an is in full force and effect (or
there has been modification, that the Management Agreement is in full
force and effect as modified and setting forth the modifications),
whether or not there has been a default under the terms of the
Management Agreement (and, if so, specifying the default), and a
representation that the Hotel is open for business to the public.
(d) An estoppel certificate, dated not more than 30 days before
the date on which the Subordinated Partner Loan is due, from the
General Partner, in form the form attached to this Agreement as
Exhibit D.
(e) Evidence of written instructions from the Partnership
delivered to the Lender contemporaneously with the payoff of the Gap
Loan and requiring the original Letter of Credit to be marked
"CANCELLED" by Lender and delivered to Investor Limited Partner.
Section 5.15 Default By Investor Limited Partner
If Investor Limited Partner fails to pay an Installment of its Capital
Contribution when due and fails to pay such Installment within 10 days after
receipt of written notice from General Partner to Investor Limited Partner and
Special Limited Partner that Investor Limited Partner is in default, then
Investor Limited Partner will be in default under this Agreement. At any time
prior to the expiration of such 10 day period after receipt of such notice,
Investor Limited Partner will have the right to either (i) cure such default by
paying to the Partnership such past due amount, and, upon such cure, Investor
Limited Partner will be reinstated in good standing in the Partnership and the
rights of the Partnership and General Partner under this Section 5.15 with
respect to such default will terminate, or (ii) contest whether such a default
occurred by giving notice of such contest to General Partner within such 10 day
period, and if Investor Limited Partner so contests such default General
Partner's rights under this Section 5.15 will be tolled until it is determined
that such a default has occurred, provided, however, that unless General Partner
and Investor Limited Partner agree to a resolution of such contest within 30
days after Investor Limited Partner's notice of such contest, or unless General
Partner has instituted an appropriate action relating to such default with a
court of appropriate jurisdiction within such 30 day period, then such a default
will not be deemed to have occurred. If Investor Limited Partner fails to cure
or contest as provided above, then: (A) the Partnership Interests of Investor
Limited Partner and Special Limited Partner shall each be deemed to be those of
a Special Class Limited Partner and the holders thereof shall be entitled only
to such rights as an assignee of a Limited Partnership Interest may have as such
under the provisions of Section 11.4 of this Agreement, the Act, and other
applicable laws of the State; (B) Investor Limited Partner's share of
Partnership Items, Cash Flow, Refinancing Proceeds, and Sale Proceeds shall be
recalculated by multiplying Investor Limited Partner's share of such items had
Investor Limited Partner not defaulted under this Section 5.14 by a fraction,
the numerator of which is the Capital Contributions actually made by Investor
Limited Partner, and the denominator of which is the total Capital Contribution
which Investor Limited Partner would otherwise have been required to make under
this Agreement; and (C) Investor Limited Partner shall have no further
obligation to make any additional Capital Contributions under this Agreement.
Section 5.16 Negative Capital Account Restoration.
A. Notwithstanding anything to the contrary contained in this Agreement,
if, immediately following the "liquidation of a Partner's interest in the
Partnership" (within the meaning of Treasury Regulations Section 1.704-1(b)
(2)(ii)(g)) with respect to a Partner, and in all events after giving effect to
(1) all allocations of income, gain, deduction, loss, tax credits and items
thereof pursuant to Article VI hereof through the date of such liquidation, (2)
any revaluation of Partnership Property or any part thereof pursuant to the
provisions hereof, (3) the foregoing capital contribution obligation provisions
of this Section 5 (which are in no way overridden by the provisions of this
Section 5.16), and (4) the distributions (including liquidating distributions)
made pursuant to the provisions of this Agreement, there is a negative balance
in the Capital Account of a Partner, such Partner shall contribute in cash to
the Partnership, within 30 days after the date of such liquidation, the amount
of its respective negative Capital Account balance (if any); PROVIDED, HOWEVER,
that the maximum aggregate amount the Limited Partners (as a group) shall be
obligated to restore pursuant to this Section 5.16 shall in no event exceed the
sum of $2,000,000.00 less, to the extent not previously taken into account under
clause (1) above, the amount of the Limited Partners' Share of Partner
Nonrecourse Debt Minimum Gain and Share of Partnership Minimum Gain. FURTHER,
PROVIDED, that if at any time after the Fiscal Year in which the Placed-In-
Service Date occurs, the amount of the Limited Partners' Share of Partner
Nonrecourse Debt Minimum Gain and Share of Partnership Minimum Gain exceeds the
Investor Limited Partner's Negative Capital Account balance (if any, ) after
giving effect to clauses (1)-(5) above, neither Special Limited Partner nor
Investor Limited Partner shall thereafter have any further obligations under
this Section 5.16.
B. All amounts contributed to the Partnership in accordance with
Paragraph (B) above shall first be used to satisfy any amounts then owing by the
Partnership to Recourse Creditors of the Partnership. Any portion of such
amounts not used to satisfy amounts owing to Recourse Creditors shall be
distributed to the Partner or Partners then having a positive balance in its or
their respective Capital Account(s) up to the aggregate of such positive Capital
Account balances (with such amounts distributed to such Partners in the ratio of
their positive Capital Account balances if more than one Partner's Capital
Account shall have a positive balance). For purposes of this Section 5.16,
"Recourse Creditors" means creditors of the Partnership that may enforce against
a general partner (in its capacity as a general partner) liability owed such
creditors by the Partnership, and nothing in this Section 5.16 shall be
construed to create any rights in creditors to any funds contributed to the
Partnership pursuant to this Section 5.16.
Section 5.17 Bridge Loan. In the event the Partnership has insufficient
funds available from Subordinate Partner Loans made pursuant to Section 5.14
and/or additional draws on the Mortgage Loan, to pay off the Gap Loan at
maturity, the General Partner shall make a loan to the Partnership in the amount
of such insufficiency (the "Bridge Loan") to enable the Partnership to pay off
the Gap Loan at maturity.
SECTION 6: PROFITS AND LOSSES; CREDITS; DISTRIBUTIONS
Section 6.1 Profits and Losses
A. After giving effect to the special allocation provisions of Section
6.5, Operating Profits and Losses and Tax Credits for any Partnership Fiscal
Year shall be allocated 1% to General Partner, 98.99% to Investor Limited
Partner, and 0.01% to Special Limited Partner.
B. After giving effect to the special allocation provisions of Section
6.5 and subject to Section 6.3C, Profits and Losses from a Capital Transaction
in any Partnership Fiscal Year shall be allocated to and among the Partners as
follows:
As to Profits:
First, an amount of Profits equal to the aggregate negative balances
(if any) in the Capital Accounts of all Partners having negative balance Capital
Accounts shall be allocated to such Partners in proportion to their negative
Capital Account balances until all such Capital Accounts have zero balances; and
Second, an amount of Profits shall be allocated to each of the
Partners until the positive balance in the Capital Account of each Partner
equals the amount of cash which would be distributed to such Partner if such
Profits were available to be distributed in accordance with the provisions of
Clauses Eleventh, Twelfth, Thirteenth and Fourteenth of Section 6.2C.
As to Losses:
First, an amount of Losses equal to the aggregate positive balances
(if any) in the Capital Accounts of all Partners having positive balance Capital
Accounts shall be allocated to such Partners in proportion to their positive
Capital Account balances until all such Capital Accounts have zero balances;
provided, however, that if the amount of Losses so to be allocated is less than
the sum of the positive balances in the Capital Accounts of those Partners
having positive balances in their Capital Accounts, then such Losses shall be
allocated to the Partners in such proportions and in such amounts so that the
Capital Account balances of each Partner shall equal, as nearly as possible, the
amount such Partner would receive if an amount equal to the excess of (i) the
sum of all Partners' balances in their Capital Accounts computed prior to the
allocation of Losses under this clause First over (ii) the aggregate amount of
Losses to be allocated to the Partners pursuant to this clause First were
distributed to the Partners in accordance with the provisions of Clauses
Eleventh, Twelfth and Thirteenth of Section 6.2C; and
Second, the balance, if any, of such Losses shall be allocated to each
of the Partners if such balance were distributed to the Partners in accordance
with the provisions of Clauses Eleventh, Twelfth and Thirteenth of Section 6.2C.
Section 6.2 Distributions Prior to Dissolution
A. Distribution of Cash Flow
Subject to the terms of the Project Documents, any Cash Flow generated
in or with respect to any Fiscal Year shall be distributed or applied from time
to time as required within 90 days after the end of each Fiscal Year in the
following order of priority:
First, to pay the Investment Servicing Fee for such Fiscal Year and
any unpaid Investment Servicing Fee accrued from prior Fiscal Years;
Second, to pay any unpaid Excess Adjustment;
Third, to pay accrued interest on the Investor Limited Partner Loans
and the Voluntary General Partner Loans, such amounts to be paid on a pari
passu, pro rata amounts of such Loans;
Fourth, to the repayment of any unpaid Investor Limited Partner Loans
and any unpaid Voluntary General Partner Loans, such amounts to be paid on a
pari passu, pro rata basis based on the outstanding amounts of such loans;
Fifth, to pay accrued interest on the Subordinated Partner Loans, such
amounts to be paid on a pari passu, pro rata basis based on the outstanding
amounts of such loans;
Sixth, to pay any unpaid Operating Deficit Loans;
Seventh, to the payment of any outstanding Excess Adjustment Loans,
with payments to be applied first to accrued but unpaid interest, and then to
principal;
Eighth, so long as any portion of the Development Fee remains unpaid,
85% of the balance of Cash Flow shall be applied to payment of the unpaid
portion of the Development Fee, and the remaining 15% of such balance shall be
distributed as follows: 1% to General Partner, 98.99% to Investor Limited
Partner, and 0.01% to Special Limited Partner;
Ninth, after payment in full of the Development Fee, if no Debt
Service Coverage Loan has theretofore been made, then 70% of the balance of Cash
Flow shall be applied to the payment of the Incentive Partnership Management Fee
and 30% of such balance shall be distributed as follows: 1% to General Partner,
98.99% to Investor Limited Partner, and 0.01% to Special Limited Partner; and
Tenth, after payment in full of the Development Fee, if a Debt Service
Coverage Loan has theretofore been made, then 21% of the balance of Cash Flow
shall be applied to the payment of the Incentive Partnership Management Fee, 49%
of such balance shall be distributed to the Investor Limited Partner, and the
remaining 30% of such balance shall be distributed as follows: 1% to General
Partner, 98.99% to Investor Limited Partner, and 0.01% to Special Limited
Partner.
B. Distributions of Refinancing Proceeds
Refinancing Proceeds shall be distributed in the following order of
priority:
First, to the payment of any reasonable and customarily expenses
associated with the transaction generating such Refinancing Proceeds, including,
without limitation, prepayment penalties, brokerage fees, legal fees and
application fees;
Second, to discharge, the debts and obligations of the Partnership
owed to the holder of the Deed of Trust;
Third, if the customary loan brokerage and origination fees
attributable to the loan resulting in the Refinancing Proceeds are less than
1.5% of the initial outstanding principal balance of such loan, to the General
Partner in an amount equal to the excess of (i) 1.5% of the initial outstanding
principal balance of such loan, over (ii) the aggregate amount of such loan
brokerage and origination fees incurred with respect to such loan;
Fourth, to fund reserves for contingent or unforeseen liabilities or
obligations of the Partnership to the extent deemed reasonable by General
Partner;
Fifth, to the payment of any unpaid Investment Servicing Fee;
Sixth, to pay any unpaid Excess Adjustment;
Seventh, to the repayment of any unpaid Investor Limited Partner
Loans, together with all interest on such Investor Limited Partner Loans, and
any unpaid Voluntary General Partner Loans, together with all interest on such
Voluntary General Partner Loans, such amounts to be paid on a pari passu, pro
rata basis based on the outstanding amounts of such loans;
Eighth, to the repayment of the Subordinated Partner Loans, together
with all interest on such Subordinated Partner Loans, such amounts to be paid on
a pari passu, pro rata basis based on the outstanding amounts of such
Subordinated Partner Loans;
Ninth, to pay any unpaid portion of the Development Fee and the
outstanding balance of the Development Fee Note;
Tenth, to pay any outstanding Operating Deficit Loans, with payments
to be applied first to accrued but unpaid interest and then to principal;
Eleventh, to the payment of any outstanding Excess Adjustment Loans,
with payments to be applied first to accrued but unpaid interest and then to
principal;
Twelfth, if Investor Limited Partner's Capital Account has a negative
balance before the transaction giving rise to the Refinancing Proceeds, to
Investor Limited Partner in an amount equal to the product of the negative
balance of Investor Limited Partner's Capital Account multiplied by 53.85% (the
"Priority Amount");
Thirteenth, if a payment was made to Investor Limited Partner under
Clause Twelfth immediately above, then to General Partner, in an amount equal to
the Priority Amount;
Fourteenth, if no Debt Service Coverage Loan has theretofore been
made, the balance to be distributed as follows: 70% to General Partner, 29.99%
to Investor Limited Partner, and 0.01% to Special Limited Partner; and
Fifteenth, if a Debt Service Coverage Loan has theretofore been made,
the balance to be distributed as follows: 21% to General Partner, 78.99% to
Investor Limited Partner, and 0.01% to Special Limited Partner.
C. Distributions of Sale Proceeds
Subject to the terms of the Project Documents and to the provisions of
Section 6.3, any Sale Proceeds shall be distributed in the following amounts and
order of priority:
First, to discharge, to the extent required by the documents relating
to the Mortgage Loan, the debts and obligations of the Partnership owed to the
holder of the Mortgage;
Second, to the payment of any unpaid Project Expenses and any
expenses associated with the transaction generating such Sale Proceeds,
including, without limitation, prepayment penalties, brokerage fees, legal fees
and application fees;
Third, to fund reserves for contingent or unforeseen liabilities or
obligations of the Partnership to the extent deemed reasonable by General
Partner;
Fourth, to the payment of any unpaid Investment Servicing Fee;
Fifth, to pay any unpaid Excess Adjustment;
Sixth, to the repayment of any unpaid Investor Limited Partner Loans,
together with all interest on such Investor Limited Partner Loans, and any
unpaid Voluntary General Partner Loans, together with all interest on such
Voluntary General Partner Loans, such amounts to be paid on a pari passu, pro
rata basis based on the outstanding amounts of such loans;
Seventh, to the repayment of the Subordinated Partner Loans, together
with all interest on such Subordinated Partner Loans, such amounts to be paid on
a pari passu, pro rata basis based on the outstanding amounts of such
Subordinated Partner Loans;
Eighth, to pay any unpaid portion of the Development Fee and the
outstanding balance of the Development Fee Note;
Ninth, to pay any outstanding Operating Deficit Loans, with payments
to be applied first to accrued but unpaid interest and then to principal;
Tenth, to the payment of any outstanding Excess Adjustment Loans, with
payments to be applied first to accrued but unpaid interest and then to
principal;
Eleventh, if Investor Limited Partner's Capital Account has a negative
balance prior to the transaction giving rise to the Sale Proceeds, to Investor
Limited Partner in an amount equal to the Priority Amount;
Twelfth, if a payment was made to Investor Limited Partner under
Clause Eleventh immediately above, then to General Partner, in an amount equal
to the Priority Amount;
Thirteenth, if no Debt Service Coverage Loan has theretofore been
made, the balance to be distributed as follows: 70% to General Partner, 29.99%
to Investor Limited Partner, and 0.01% to Special Limited Partner; and
Fourteenth, if a Debt Service Coverage Loan has theretofore been made,
the balance to be distributed as follows: 21% to General Partner, 78.99% to
Investor Limited Partner, and 0.01% to Special Limited Partner.
Section 6.3 Liquidation
A. Upon the liquidation and dissolution of the Partnership, unless the
business of the Partnership is continued pursuant to the provisions of Section
10, General Partner shall liquidate the assets of the Partnership and cause the
business of the Partnership to be wound up in accordance with the Act.
B. Subject to the provisions of Section 6.3C, any Capital Proceeds from a
Terminating Capital Transaction remaining after payment of, or adequate
provision for, the debts and obligations of the Partnership shall be distributed
to those Partners with positive Capital Account balances (after taking into
account all Capital Account adjustments for the Partnership taxable year).
C. The parties intend that, as a result of the application of the
allocation and distribution provisions contained in this Section 6, any Sale
Proceeds from a Terminating Capital Transaction will be distributed in the same
manner as Sale Proceeds are distributed under the provisions of Section 6.2C.
If the Partnership is advised at any time by the Accountants or counsel to the
Partnership that an actual distribution of Sale Proceeds at the end of any
Fiscal Year in accordance with the provisions of Section 6.3B would not result
in each Partner receiving the amount that such Partner would have received if
Section 6.2C rather than Section 6.3B applied to such distribution, General
Partner shall so notify Special Limited Partner and, with the Consent of Special
Limited Partner, shall amend the provisions of this Section 6 relating to the
allocation of Profits and Losses (other than the Regulatory Allocations) for
such Fiscal Year (and for subsequent Fiscal Years if necessary) to cure such
defect consistent with the principles set forth in the first sentence of this
Section 6.3C.
Section 6.4 Special Distribution Provisions
A. Notwithstanding anything to the contrary contained herein, to the
extent required (to maintain the Partnership's tax classification as a
partnership for federal income tax purposes) by Revenue Procedure 89-12 or any
successor provisions with respect thereto, General Partner shall receive, as an
aggregate distribution under Sections 6.2 or 6.3, not less than 1% of the
aggregate amounts distributed to all the Partners, in their status as such,
under Sections 6.2 or 6.3. In order to carry the immediately preceding sentence
into effect, in the event that any aggregate distribution to General Partner
would, but for the provisions of this paragraph, fail to equal or exceed 1% of
the aggregate amount distributable to all the Partners in their status as such,
then the amounts otherwise distributable to all the Partners, in their status as
such, under Sections 6.2 or 6.3 shall be reduced and reallocated to General
Partner in order to assure General Partner of General Partner's 1% share.
B. Except as otherwise specifically provided in this Section 6.4, if the
funds available for any Distribution to the Partners are insufficient to
distribute to any class of Partners the maximum amount which otherwise would be
distributable to such class under the applicable provision(s) of this Section 6,
the amount available for distribution shall be distributed pro rata to the
members of such class in proportion to the aggregate amount that would be
distributed to them under such provision(s) if the Partnership hypothetically
had the minimum amount of funds to make the required distribution under such
provision in full.
Section 6.5 Special Allocation Provisions
Notwithstanding anything to the contrary contained herein:
A. Nonrecourse Deductions shall be allocated 98.99% to Investor Limited
Partner, 0.01% to Special Limited Partner, and 1% to General Partner.
B. Partner Nonrecourse Deductions shall be allocated to and among the
Partners in the manner provided in the Allocation Regulations.
C. Subject to the provisions of Section 6.5R, if there is a net decrease
in Partnership Minimum Gain for a Partnership Fiscal Year, the Partners shall be
allocated items of Partnership income and gain in accordance with the provisions
of Section 1.704-2(f) of the Allocation Regulations.
D. Subject to the provisions of Section 6.5R, if there is a net decrease
in Partner Nonrecourse Debt Minimum Gain for a Partnership Fiscal Year, then any
Partner with a Share of such Partner Nonrecourse Debt Minimum Gain shall be
allocated items of Partnership income and gain in accordance with the provisions
of Section 1.704-2(i)(4) of the Allocation Regulations.
E. Subject to the provisions of Sections 6.5A through 6.5D, in the event
that any Limited Partner (who is not also a General Partner) unexpectedly
receives any adjustments, allocations or distributions described in Section
1.704-1(b)(2)(ii)(d)(4), (5) or (6) of the Allocation Regulations, items of
Partnership income and gain shall be specially allocated to each such Limited
Partner in an amount and manner sufficient to eliminate, to the extent required
by the Allocation Regulations, the Adjusted Capital Account Deficit of such
Limited Partner as quickly as possible. This Section 6.5E is intended to
constitute a "qualified income offset" provision within the meaning of the
Allocation Regulations and shall be interpreted consistently therewith.
F. Subject to the provisions of Sections 6.5A through 6.5E, in no event
shall the Limited Partner be allocated Losses which would cause the Limited
Partner to have an Adjusted Capital Account Deficit as of the end of any
Partnership Fiscal Year. Any Losses which are not allocated to a Limited
Partner by reason of the application of the provisions of this Section 6.5F
shall be allocated to General Partner.
G. Subject to the provisions of Sections 6.5A through 6.5F, in the event
that any Limited Partner (who is not also a General Partner) has an Adjusted
Capital Account Deficit at the end of any Partnership Fiscal Year, items of
Partnership income and gain shall be specially allocated to each such Limited
Partner in the amount of such Adjusted Capital Account Deficit as quickly as
possible.
H. Without limiting the generality of Section 6.5B, if the Partnership
incurs recourse obligations to fund the payment of deductible items which are
not anticipated to be paid in the ordinary course of business (such obligations
and losses being referred to herein collectively as "Excess Expenses") in
respect of any Fiscal Year, then the calculation and allocation of Profits and
Losses shall be adjusted as follows: first, an amount of deductions equal to
such Excess Expenses for the Fiscal Year in question shall be allocated to
General Partner; and second, the balance of such deductions and all items of
gross income shall be allocated as provided in Section 6.1A. Nothing in this
Section 6.5H shall prevent the Partnership from recovering an extraordinary loss
from a General Partner who is liable therefor by law or under this Agreement.
If any Excess Expenses shall be repaid to the Partnership during any Fiscal
Year, then the allocation of Profit and Losses under Section 6.1A for such
Fiscal Year shall be adjusted as follows: first, General Partner shall be
allocated an amount of the gross income of the Partnership equal to the amount
of the Excess Expenses repaid in such Fiscal Year; and second, the balance of
such gross income and all items of deductions shall be allocated as provided in
Section 6.1A.
I. In accordance with Code Section 704(c) and the Treasury Regulations
thereunder, income, gain, loss, and deduction with respect to any property
contributed to the capital of the Partnership shall, solely for tax purposes, be
allocated among the Partners so as to take account of any variation between the
adjusted basis of such property to the Partnership for federal income tax
purposes and such property's initial Gross Asset Value. In the event that the
Gross Asset Value of any Partnership Property is adjusted pursuant to the terms
of this Agreement, subsequent allocations of income, gain, loss, and deduction
with respect to such asset shall take account of any variation between the
adjusted basis of such asset for federal income tax purposes and such asset's
Gross Asset Value in the same manner as under Code Section 704(c) and the
Treasury Regulations thereunder. Any elections or other decisions relating to
such allocations shall be made by General Partner in any manner that reasonably
reflects the purpose and intent of this Agreement. Allocations pursuant to this
Section 6.5I are solely for purposes of federal, state, and local taxes and
shall not affect, or in any way be taken into account in computing, any
Partner's Capital Account or share of Profits, Losses, other items, or
distributions pursuant to any provision of this Agreement.
J. For purposes of determining the Profits, Losses, Tax Credits or any
other items allocable to any period, Profits, Losses, Tax Credits and any such
other items shall be determined on a daily, monthly, or other basis, as
determined by General Partner using any permissible method under Code Section
706 and the Treasury Regulations thereunder.
K. If the IRS successfully disallows the deduction of all or any part of
any fee paid by the Partnership to General Partner or to General Partner's
Affiliates by recharacterizing such fee as a Distribution to General Partner,
there shall be, to the extent permitted by the Code, a special allocation of
gross income to such General Partner for the Fiscal Year with respect to which
such disallowed deduction was claimed by the Partnership in the amount of such
disallowed deduction.
L. Except as otherwise specifically provided in this Section 6, all
Profits, Losses and Tax Credits allocated to each class of Partners shall be
shared by the respective Partners in such class in the ratio which the paid-in
Capital Contribution of each Partner in such class bears to the aggregate paid-
in Capital Contributions of all Partners in such class.
M. Notwithstanding anything to the contrary contained herein, to the
extent required (to maintain the Partnership's tax classification as a
partnership for federal income tax purposes) by Revenue Procedure 89-12 or any
successor provisions with respect thereto, General Partner (or, if there is more
than one General Partner, all of General Partners as a group) shall be allocated
not less than 1% of each material item of Partnership income, gain, loss,
deduction and credit ("Partnership Items") at all times during the existence of
the Partnership, provided, however, that temporary non-conformance with the
provisions of this Section 6.5M shall be permitted to the extent permitted by
Revenue Procedure 89-12 or any successor provisions. Subject to the foregoing,
in the event that there is no allocation of a material Partnership Item to
General Partner(s) hereunder or if the amount of any material Partnership Item
allocable to General Partner(s) hereunder shall not equal 1% of the aggregate
amount allocable to all the Partners without giving effect to this provision,
then the amount of such Partnership Item(s) otherwise allocable to the Limited
Partners hereunder shall be correspondingly reduced in order to assure General
Partner(s) of General Partner's 1% share. Any such reduction shall be applied
to reduce the shares of all classes of Limited Partners in proportion to their
respective percentage interests.
N. For purposes of determining each Partner's proportionate share of the
excess Nonrecourse Liabilities of the Partnership pursuant to Section
1.752-3(a)(3) of the Allocation Regulations, Investor Limited Partner shall be
deemed to have a 98.99% interest in Profits, Special Limited Partner shall be
deemed to have a 0.01% interest in Profits, and General Partner shall be deemed
to have a 1% interest in Profits.
O. Any recapture of any Historic Rehabilitation Credit shall be allocated
to and among the Partners in the same manner and proportions in which the
Historic Rehabilitation Credit was allocated to such Partners.
P. In the event the adjusted tax basis of any investment credit property
that has been placed in service by the Partnership is increased pursuant to
Section 50(c) of the Code, such increase shall be allocated among the Partners
(as an item in the nature of income or gain) in the same proportions as the
investment tax credit that is recaptured with respect to such property is shared
among the Partners. Any reduction in the adjusted tax basis (or cost) of
Partnership investment credit property pursuant to Section 50(c) of the Code
shall be allocated among the Partners (as an item in the nature of expenses or
losses) in the same proportions as the basis (or cost) of such property is
allocated pursuant to Treasury Regulation Section 1.46-3(f)(2)(i).
Q. The basis (or cost) of any Partnership investment credit property
shall be allocated among the Partners in accordance with Treasury Regulation
Section 1.46-3(f)(2)(i). In the event Partnership investment credit property is
disposed of during any taxable year, Profits for such taxable year (and, to the
extent such Profits are insufficient, Profits for subsequent taxable years) in
an amount equal to the excess, if any, of (i) the reduction in the adjusted tax
basis (or cost) of such property pursuant to Section 50(c) of the Code, over
(ii) any increase in the adjusted tax basis of such property, shall be allocated
among the Partners in proportion to their respective shares of such excess
determined pursuant to Section 6.5P. In the event that more than one item of
such property is disposed of by the Partnership, the foregoing sentence shall
apply to such items in the order in which they are disposed of by the
Partnership, so that Profits equal to the entire amount of such excess with
respect to the first such property disposed of shall be allocated prior to any
allocations with respect to the second such property disposed of, etc.
R. If for any Fiscal Year the application of the minimum gain chargeback
provisions of Section 6.5C or Section 6.5D would cause a distortion in the
economic arrangement among the Partners and it is not expected that the
Partnership will have sufficient other income to correct that distortion,
General Partner shall, if requested by the Special Limited Partner, request a
waiver from the Commissioner of the IRS of the application in whole or in part
of Section 6.5C or Section 6.5D in accordance with Section 1.704-2(f)(4) of the
Allocation Regulations. Furthermore, if additional exceptions to the minimum
gain chargeback requirements of the Allocation Regulations have been provided
through revenue rulings or other IRS pronouncements, General Partner is
authorized to cause the Partnership to take advantage of such exceptions if to
do so would be in the best interest of the Investor Limited Partner.
S. Except as otherwise specifically provided in this Agreement, all items
of Partnership income, gain, loss, deduction and other items not specifically
provided for shall be allocated to and among the Partners in the same manner as
Profits and Losses are allocated pursuant to the provisions of Section 6.1.
Allocations pursuant to this Section 6.5S are solely for purposes of federal,
state and local taxes and shall not affect, or in any way be taken into account
in computing, any Partner's Capital Account or share of Profits, Losses, Tax
Credits or Distributions pursuant to any other provisions of this Agreement.
Section 6.6 Order of Application
The provisions of this Section 6 shall be applied in the order required by
the applicable provisions of the Allocation Regulations or if no such order is
specified, in the manner determined by the Accountants with the Consent of the
Special Limited Partner to be necessary to cause the allocations to have
"substantial economic effect" given the manner and relative priorities in which
the Partners have agreed to share in distributions of Net Cash Flow, Refinancing
Proceeds, Sale Proceeds and liquidation proceeds under Section 6 and in either
case, to maximize the amount of the Historic Rehabilitation Credit allocable to
the Limited Partners.
SECTION 7: RIGHTS, POWERS AND DUTIES OF GENERAL PARTNER
Section 7.1 Restrictions on Authority
A. Notwithstanding any other provisions of this Agreement, General
Partner shall have no authority to perform any act in respect of the Partnership
or the Project in violation of (i) the Regulations or any other applicable law
and regulations, (ii) any agreement to which the between the Partnership and the
Lender relating to the Project, or (iii) this Agreement. With respect to the
execution of the Loan Documents and the Project Documents, however, violation of
the preceding sentence shall result only in liability of General Partner to the
Partnership and the other Partners, and shall not invalidate or cause the
Partnership not to be bound by any of said documents except that any agreement
between the Partnership and General Partner or General Partner's Affiliates may
be rejected without liability to the Partnership if the Consent of Special
Limited Partner is not obtained.
B. Except as provided in Section 3, General Partner shall not have any
authority to do any of the following acts without the Consent of Special Limited
Partner (which, except as provided in Section 3, may be given or withheld with
or without cause in Special Limited Partner's sole discretion) and, if required,
any Requisite Approvals:
(i) to incur indebtedness for money borrowed on the general credit of
the Partnership; or
(ii) to make a material change to the Plans and Specifications; or
(iii) following the Certificate of Occupancy, any expenditure to
construct any new capital improvements, or to replace any existing capital
improvements for an amount in excess of $25,000; or
(iv) to acquire by purchase or lease any real property in addition to
the Real Property (other than easements or similar rights necessary or
convenient for the operation of the Project); or
(v) to cause the Partnership to make any loan or advance to any
Person (for purposes of this clause, accounts receivable incurred and paid
in the ordinary course of business from Persons other than General Partner
or General Partner's Affiliates shall not be deemed to be advances or
loans); or
(vi) to take any action which would cause a Recapture Event; or
(vii) to sell any material portion of the Partnership Property; or
(viii) to refinance or materially modify the Mortgage Loan, the TIF
Advance Loan or the Gap Loan; or
(ix) to terminate or appoint a new Manager; or
(x) to terminate or appoint new Accountants; or
(xi) to incur a Debt Service Deficiency Loan in an amount which is
less than $20,000.00; or
(xii) to make Partnership decisions under Section 5.02 and 5.03 of
Management Agreement;
(xiii) to admit a Person as a Partner, except as provided in this
Agreement;
(xiv) amend this Agreement or the Certificate of Limited
Partnership filed on behalf of the Partnership;
(xv) so long as any obligation secured by the Mortgage Loan is
outstanding, file a voluntary petition or otherwise initiate
proceedings to have the Partnership adjudicated bankrupt or
insolvent, or consent to the institution of bankruptcy or
insolvency proceedings against the Partnership, or file a
petition seeking or consenting to reorganization or relief of the
Partnership as debtor under any applicable federal or state law
relating to bankruptcy, insolvency, or other relief for debtors
with respect to the Partnership; or seek or consent to the
appointment of any trustee, receiver, conservator, assignee,
sequestrator, custodian, liquidator (or other similar official)
of the Partnership or of all or any substantial part of the
properties and assets of the Partnership, or make any general
assignment for the benefit of creditors of the partnership, or
admit in writing the inability of the Partnership to pay its
debts generally as they become due or declare or effect a
moratorium on the Partnership debt or take any action in
furtherance of any such action; or
(xvi) merge or consolidate with any other entity.
Section 7.2 Personal Services and Competition
A. General Partner shall receive no compensation for General Partner's
services as General Partner except as specifically provided in the Incentive
Partnership Management Agreement.
B. The sole purpose of General Partner is to act as General Partner of
the Partnership and to do any and all acts necessary or incidental to that
purpose. General Partner shall not engage in any other business or activity.
C. Any Limited Partner may engage in and have an interest in other
business ventures of every nature and description, independently or with others,
including, but not limited to, the ownership, financing, leasing, operation,
construction, rehabilitation, renovation, improvement, management and
development of real property whether or not such real property is directly or
indirectly in competition with the Project. Neither the Partnership nor any
other Partner shall have any rights by virtue of this Agreement in and to such
independent ventures or the income or profits derived therefrom, regardless of
the location of such real property and whether or not such venture was presented
to such Limited Partner as a direct or indirect result of such Limited Partner's
connection with the Partnership or the Project.
Section 7.3 Business Management and Control; Designation of Managing
General Partner
A. Except as otherwise provided in this Agreement, General Partner shall
have the exclusive right to manage the business of the Partnership and, except
as otherwise specifically provided herein, shall have all of the rights and
powers granted to general partners pursuant to the provisions of the Act. No
Limited Partner (except one who may also be a General Partner, and then only in
such Partner's capacity as a General Partner) shall (i) have any authority or
right to act for or bind the Partnership, or (ii) except as required by law,
participate in or have any control over the Partnership business. Any action
required or permitted to be taken by a corporate General Partner hereunder may
be taken by such of corporate General Partner's properly authorized officers or
agent as such corporate General Partner may validly designate for such purpose.
B. If at any time there is more than one General Partner, the powers and
duties of General Partners hereunder shall be exercised in the first instance by
the Managing General Partner who, subject to the terms and provisions of this
Agreement, shall manage the business and affairs of the Partnership. Each
Managing General Partner is hereby authorized to execute and deliver in the name
and on behalf of the Partnership all such documents and papers (including any
required by any Governmental Authority, the Bank or the Lender) as such Managing
General Partner deems necessary or desirable in carrying out such duties
hereunder, provided such documents and papers are consistent with the terms of
this Agreement. HRI-▇▇▇▇▇▇ is hereby designated as the initial Managing General
Partner. In the event that HRI-▇▇▇▇▇▇ shall become unable to serve in such
capacity or shall cease to be a General Partner, or shall have been removed or
replaced by Special Limited Partner as provided in this Agreement, Special
Limited Partner may designate another General Partner, if there is then another
General Partner, as Managing General Partner, and HRI-▇▇▇▇▇▇ shall take such
actions and execute such documents as Special Limited Partner may reasonably
request to reflect such removal or replacement and the appointment of such other
General Partner as Managing General Partner. Any action required or permitted
to be taken by a corporate General Partner hereunder may be taken by such of
corporate General Partner's proper officers or agents as such corporate General
Partner shall validly designate for such purpose.
C. In the event that a Material Default occurs, and in addition to any
other rights granted to Investor Limited Partner or Special Limited Partner
hereunder, including, without limitation, Special Limited Partner's right to
remove and replace General Partner pursuant to the provisions of Section 8,
Special Limited Partner may, at Special Limited Partner's election, proceed to
exercise Special Limited Partner's rights under this Section 7.3 by giving
notice of such Material Default to General Partner, except in the case of a
Terminating Event with respect to a sole General Partner, in which case no
notice to General Partner shall be required and the rights of Special Limited
Partner set forth in this Section shall be immediately exercisable. If such
default is not cured within 10 business days of such notice (and, with respect
to defaults other than those which relate to the payment of money and which by
the nature of such default cannot be cured within such ten day period, no
default will be deemed to have occurred under this Section if General Partner,
within such ten day period, in good faith commences actions which are likely to
cure such default and diligently prosecutes such cure to completion, and, in any
event, there has been no assignment of or institution of proceedings to
foreclose under the Deed of Trust) or if a Terminating Event shall occur with
respect to the General Partner then, in the case of such a Terminating Event,
the Investor Limited Partner and the Special Limited Partner may elect to
continue the Partnership and, in the case of any Material Default and/or
Terminating Event with respect to the General Partner pursuant to which the
Limited Partners have so elected to continue the Partnership, the Special
Limited Partner may elect to become, or to designate another Person to become,
an additional General Partner with all the rights and privileges of a General
Partner. Upon such election by Special Limited Partner, Special Limited Partner
or such other Person shall automatically become and shall be deemed to be a
General Partner and the Managing General Partner, if Special Limited Partner so
elects, and each Partner hereby irrevocably appoints Special Limited Partner
(with full power of substitution) as the attorney-in-fact of such Partner for
the purpose of executing, acknowledging, swearing to, recording and/or filing
any amendment to this Agreement or the Certificate of Limited Partnership
necessary or appropriate to confirm the foregoing but the foregoing appointment
of an attorney-in-fact shall not relieve the defaulting General Partner from its
duty to take such action and execute such documents as Special Limited Partner
may reasonably request to reflect such election by the Special Limited Partner.
If Special Limited Partner shall become an additional General Partner as
provided in this Section, Special Limited Partner's Partnership Interest shall
not be increased as a result thereof. In the event of the admission of Special
Limited Partner or such Person as a General Partner pursuant to this Section,
and if there are then any other General Partners, Special Limited Partner or
such other Person, shall have all managerial rights, authority and all voting
rights on any matters to be decided or voted upon by General Partners or the
Managing General Partner, as the case may be.
Section 7.4 Duties and Obligations of General Partner
A. General Partner shall its best efforts to carry out the purposes,
business and objectives of the Partnership referred to in Section 2.3, provided,
however, that except as otherwise required by this Agreement, "best efforts"
shall not obligate General Partner to expend its own funds. General Partner
shall devote to Partnership business such time and effort as shall be reasonably
required for the Partnership's welfare and success, including, without
limitation, such of General Partner's time as may be necessary to (i) supervise
the activities of the Manager, (ii) make inspections of the Project to determine
if the Project is being properly maintained and that necessary repairs are being
made thereto (and to take, or to cause the Manager to take, such steps as are
necessary to effectuate such repairs), (iii) prepare or cause to be prepared all
reports of operations which are to be furnished to the Partners or which are
required by the Lender, and all taxing bodies or any other appropriate
Governmental Authorities, (iv) subject to any additional requirements imposed by
the Project Documents, cause the Project to be insured against fire and other
risks covered by such insurance and cause the Manager to obtain and keep in
force during the term of the Partnership business or rental interruption and
worker's compensation (if applicable), in the manner specified in Section 6.01A
of the Management Agreement, the Loan Documents, the Gap Loan Documents and the
TIF Loan Documents, (v) cause the Partnership to obtain and maintain, either
directly or pursuant to the Management Agreement, public liability insurance and
casualty insurance for the benefit of the Partnership and the Partners in
amounts specified in Section 6.01.A.4 of the Management Agreement, the Loan
Documents, the Gap Loan Documents and the TIF Loan Documents, (vi) enforce all
contracts entered into for the benefit of the Partnership, and (vii) do all
other things which may be necessary to manage the affairs and business of the
Partnership. In addition, General Partner shall promptly provide Special
Limited Partner or Special Limited Partner's representatives with copies of such
insurance policies upon request from time to time. General Partner shall review
regularly all of the Partnership and Project insurance coverage to insure that
such coverage is adequate and that such coverage complies with the provisions of
the Management Agreement and/or this Section. Further, in the event of any
casualty, to the extent required by this Agreement, and provided that the
insurance proceeds shall be made available therefor, General Partner shall
repair any damage to the Project which was caused by such event, so as to
restore the Project (as nearly as possible) to the condition and market value
thereof immediately prior to such occurrence.
B. General Partner shall operate the Project and cause the Project to be
developed in accordance with the terms of this Agreement and (i) the Project
Documents, (ii) all applicable statutes, rules and regulations with respect to
the Project, and (iii) any other agreement relating to the Project.
C. General Partner shall use reasonable efforts consistent with sound
management practice and with the terms of the Project Documents and the
Management Agreement to maximize the Cash Flow available for distribution to the
Partners.
D. General Partner will use its best efforts to take all necessary
actions to ensure that the Project will constitute a "certified historic
structure" within the meaning of Section 47(c)(3)(A) of the Code and, upon
completion of the Rehabilitation, will qualify as a "qualified rehabilitated
building" within the meaning of Section 47(c)(1)(A) of the Code.
E. General Partner will use General Partner's best efforts to take all
necessary actions to ensure that the Rehabilitation expenditures incurred in
connection with the Project will constitute "qualified rehabilitation
expenditures" within the meaning of Section 47(g)(2) of the Code, and the
Partnership will make the elections and otherwise comply with the provisions of
Sections 46, 47(g), 49 and 168 of the Code and the Treasury Regulations
promulgated thereunder.
F. [LEFT INTENTIONALLY BLANK]
G. General Partner agrees that, except as provided in or contemplated by
the Project Documents, neither General Partner nor any Related Person will at
any time bear the economic risk of loss for payment of the Mortgage Loan, or the
Gap Loan. General Partner agrees that General Partner will not cause any
Limited Partner at any time to bear the economic risk of loss for payment or
performance under the Mortgage Loan, the TIF Advance Loan or the Gap Loan.
H. General Partner shall (i) not store (except in compliance with all
laws, ordinances, and regulations pertaining thereto), or dispose of any
Hazardous Material at the Project, or at or on any other Site or Vessel owned,
occupied, or operated either by any General Partner, any Affiliate of a General
Partner, or any Person for whose conduct any General Partner is or was
responsible; (ii) neither directly nor indirectly transport or arrange for the
transport of any Hazardous Material (except in compliance with all laws,
ordinances, and regulations pertaining thereto); (iii) provide Limited Partners
with written notice (x) upon any General Partner's obtaining knowledge of any
potential or known release, or threat of release, of any Hazardous Material at
or from the Project or any other Site or Vessel owned, occupied, or operated by
any General Partner, any Affiliate of a General Partner or any Person for whose
conduct any General Partner is or was responsible or whose liability may result
in a lien on the Project; (y) upon any General Partner's receipt of any notice
to such effect from any federal, state, or other Governmental Authority; and (z)
upon any General Partner's obtaining knowledge of any incurrence of any expense
or loss by any such Governmental Authority in connection with the assessment,
containment, or removal of any Hazardous Material for which expense or loss any
General Partner may be liable or for which expense or loss a lien may be imposed
on the Project.
I. If General Partner becomes aware of the presence of levels of
Hazardous Material at (or in connection with the operations of) the Project, in
concentrations and under conditions deemed detrimental to human health under any
applicable Hazardous Substance Laws, and/or in quantities or proportions that
exceed safe limits for such substance established by any such Hazardous
Substance Laws, General Partner shall (i) notify all Partners of such situation
and (ii) take all actions necessary to correct such situation as expeditiously
as possible and to prevent the Project from being in violation of any Hazardous
Substance Laws, provided, however, that General Partner may use Partnership
funds for such purposes and shall not be required by the provisions hereof to
use General Partner's own personal funds, except as may be required pursuant to
the terms of this Agreement.
J. General Partner represents that General Partner has a net worth
sufficient to satisfy the Designated Net Worth Standard and covenants that (i)
during the Initial Operating Period, it will cause HRI to maintain a net worth
equal to or greater than $4,000,000.00 determined in accordance with GAAP and
(ii) HRI will not, without the Consent of Special Limited Partner, which Consent
may be withheld or granted in Special Limited Partner's sole and absolute
discretion, reduce HRI's net worth including, but not limited to, by making
distributions to any of HRI's principals or other owners of a beneficial
interest in HRI, by way of payment of dividends to stockholders, increasing
salaries paid to officers, making any other distributions to stockholders,
officers or directors of an Entity comprising HRI, or taking any other action
which would reduce the net worth of HRI below that required to meet the
Designated Net Worth Standard.
K. Except as otherwise specifically provided herein, neither General
Partner, nor any director, employee or agent of any General Partner, or of
General Partner's subcontractors or vendors, shall give to or receive from any
director, employee, agent or other Affiliate of Investor Limited Partner or
third party, any gift or entertainment of significant value or any commission,
fee, rebate or other compensation in connection with the organization, business,
sale or operations of the Partnership. In addition, neither General Partner
nor any director, employee, agent or other Affiliate of any General Partner, nor
any subcontractors or vendors of General Partner or any Affiliate of General
Partner, shall enter into any business arrangement with any director, employee,
agent or other Affiliate of Investor Limited Partner and Special Limited Partner
who is not acting as a representative of Investor Limited Partner or Special
Limited Partner, or their Affiliates, with prior written notification thereof to
them. Any representatives authorized by Investor Limited Partner and Special
Limited Partner may audit any and all records of General Partner and the
Partnership, and any subcontractors or vendors of either for the sole purpose of
determining whether there has been compliance with the provisions of this
Section 7.4K. In the event the General Partner or its Affiliates engage in
transactions with third parties in which any monetary benefit is derived by the
General Partner (other than in its status as General Partner) or its Affiliates
with respect to other interests or properties or interests held by the General
Partner and/or Affiliate, the General Partner shall fully disclose the terms of
such dealings and the compensation derived thereby to the Special Limited
Partner.
L. In operating the Project, General Partner shall use reasonable efforts
to obtain all contracts, materials, supplies, utilities and services required by
the Project on the most advantageous terms available to the Project. General
Partner shall secure and credit to the Partnership, and not receive or retain
for itself, General Partner's agents, employees or Affiliates, any discounts,
compensation, rebates or commissions obtainable with respect to any and all
purchases, service contracts, and all other transactions affecting the Project,
including without limitation, any compensation received from the assignment or
transfer of any contracts affecting the Project.
M. General Partner shall complete or cause to be completed the
Rehabilitation and development activities of the Project in a timely and
workmanlike manner in accordance with (x) all applicable requirements of the
Project Documents, (y) all applicable requirements of all appropriate
Governmental Authorities, and (z) the Plans and Specifications.
N. General Partner or any Affiliates thereof shall have the right to
contract or otherwise deal with the Partnership for the sale of goods or
services to the Partnership in addition to those set forth herein, if (i) the
compensation paid or promised for such goods or services is reasonable (i.e., at
fair market value) and is paid only for goods or services actually furnished to
the Partnership, (ii) the goods or services to be furnished shall be reasonable
for and necessary to the Partnership, (iii) the fees, terms and conditions of
such transaction are at least as favorable to the Partnership as would be
obtainable in an arm's-length transaction, and (iv) no agent, attorney,
accountant or other independent consultant or contractor who also is employed on
a full-time basis by General Partner or any Affiliate shall be compensated by
the Partnership for such Person's services; provided, however, that the validity
of any transaction, agreement or payment involving the Partnership and the
General Partner or any Affiliate of the General Partner otherwise permitted
hereunder shall not be affected by reason of the relationship between such
Person and the Partnership or any of its partners. Any contract covering such
transactions shall be in writing and shall be terminable without penalty on 60
days' notice. Any payment made to General Partner or any Affiliate pursuant to
such contracts and transaction shall be fully disclosed to the Limited Partners
in the reports required under Section 9 and the Special Limited Partner shall
have the right, exercisable in its sole discretion, to direct the General
Partner to enforce, settle or prosecute and, upon and, in accordance with such
direction, the General Partner shall enforce, settle and prosecute, any and all
of the Partnership's rights, claims or causes of action under or pursuant to
such transactions or contracts (including, but not limited to, the Construction
and Design Contract and the Development Agreement). Neither General Partner nor
any Affiliate or General Partner shall, by the making of lump-sum payments to
any other Person for disbursement by such other Person or otherwise, circumvent
the provisions of this Section 7.4N.
Section 7.5 Certain Payments to the Developer and Developer's Affiliates
A. As a fee for the Developer's services in connection with the
development of the Property in accordance with the Development Agreement, the
Developer shall receive a fee (the "Development Fee") in the amount set forth in
the Development Agreement. The Partnership acknowledges that Developer shall
have earned 60% of the Development Fee as of the Admission Date and that the
Developer shall have earned the remaining 40% of the Development Fee based on
the percentage of completion of the Rehabilitation. If the Development Fee has
not been fully paid by the fifteenth anniversary of the Temporary Certificate of
Occupancy Date, General Partner shall make a payment to the Partnership in an
amount sufficient to enable the Partnership to pay any unpaid portion of the
Development Fee, and the Partnership shall so pay such fee. Such payment by
General Partner shall not constitute a loan nor contribution of capital to the
Partnership by General Partner, and General Partner will not be entitled to
receive any repayment or other compensation or consideration with respect to
such amounts.
B. The Partnership also shall enter into the Incentive Partnership
Management Agreement with the General Partner under which the General Partner
shall agree to provide consulting services to the Partnership and Project, to
undertake to perform such bookkeeping, financial and reporting services to be
performed under Section 9 (other than those to be performed by the Accountants)
as the Partnership may request, and to perform the other services provided in
the Incentive Partnership Management Agreement. The Incentive Partnership
Management Agreement shall provide that the sole compensation payable to the
General Partner for such services shall be the Incentive Partnership Management
Fee if and to the extent funds are available for the payment thereof out of Cash
Receipts of the Partnership, which fees for each Fiscal Year shall be calculated
in the manner specified in the Incentive Partnership Management Agreement.
Section 7.6 Fiduciary Duty of General Partner
The relationship of General Partner to the Limited Partners is that of a
fiduciary, and General Partner has a fiduciary obligation to perform General
Partner's duties in such manner as will serve the best interests of the
Partnership and the Limited Partners. General Partner shall not have the right
to contract away of General Partner's fiduciary duties under the common law of
agency, and General Partner shall not attempt to enter into any such contract,
and if, notwithstanding the foregoing, General Partner nonetheless attempts to
enter into such a contract, such a contract will be void and of no force or
effect.
Section 7.7 Indemnification
A. No General Partner shall have any liability to the Partnership or to
any Partner for any loss suffered by the Partnership which arises out of any
action or inaction of such General Partner if such General Partner, in good
faith, determined that such course of conduct was in accordance with the terms
of this Agreement and in the best interest of the Partnership and such course of
conduct did not constitute negligence or wilful misconduct of such General
Partner. To the full extent permitted by law, each General Partner shall be
indemnified by the Partnership against any losses, judgments, liabilities,
expenses and amounts paid in settlement of any claims sustained by such Person
in connection with the Partnership, provided that the same were not the result
of negligence or wilful misconduct on the part of such General Partner and were
the result of a course of conduct which such General Partner, in good faith,
determined was in accordance with the terms of this Agreement and in the best
interest of the Partnership. Any indemnity under this Section 7.7 shall be
provided out of and to the extent of Partnership assets only, and no Limited
Partner shall have any personal liability on account thereof.
B. Notwithstanding the provisions of Section 7.7A, no General Partner, no
Person acting as a broker-dealer, nor any Affiliate thereof, shall be
indemnified for any losses, liabilities or expenses arising from or out of an
alleged violation of federal or state securities laws unless (i) there has been
a successful adjudication on the merits of each count involving alleged
securities law violations as to the particular indemnitee and the court approves
indemnification of litigation costs, or (ii) such claims have been dismissed
with prejudice on the merits by a court of competent jurisdiction as to the
particular indemnitee and the court approves indemnification of litigation
costs, or (iii) a court of competent jurisdiction approves a settlement of the
claims against a particular indemnitee and finds that indemnification of the
settlement and related costs should be made.
C. The Partnership shall not incur the costs of that portion of any
insurance, other than public liability insurance, which insures any Person
against any liability as to which such Person is herein prohibited from being
indemnified. Nothing contained in this Section 7.7, however, shall restrict the
right of the Partnership to (i) indemnify unaffiliated Persons who will be
performing services on behalf of the Partnership, including but not limited to
consultants, engineers and experts, pursuant to any contract entered into by a
General Partner on behalf of the Partnership in order to carry out the
objectives of the Partnership, or (ii) apply Partnership funds, including,
without limitation, proceeds of public liability insurance in favor of the
Partnership, to cover damage to property or personal injuries to unaffiliated
Persons.
Section 7.8 Liability of General Partner to Limited Partners
Except as otherwise specifically provided in this Agreement, no General
Partner shall be liable, responsible or accountable for damages or otherwise to
any Limited Partner for any act which such Person, in good faith, determined to
be in accordance with the terms of this Agreement and within the scope of the
authority conferred by this Agreement, except for acts of breaches of fiduciary
duty, negligence, or wilful misconduct or for damages arising from any material
misrepresentation or breach of any covenant or warranty set forth herein. In
any instance in which a General Partner is in doubt as to the propriety of any
proposed action or omission under the terms of this Agreement, such General
Partner may, but shall not be under any duty to, seek the ratification of such
action or omission by the Consent of Special Limited Partners. If such Consent
of Special Limited Partner is obtained thereto, such General Partner shall be
fully protected in relying thereon, and actions or omissions in reliance thereon
shall not be deemed to be a breach of any provisions of this Agreement.
Section 7.9 Tax Matters Partner
A. The Tax Matters Partner ("TMP") for the Partnership shall be General
Partner (or, if there is a Managing General Partner, the Managing General
Partner) serving in such capacity from time to time.
B. The TMP shall have the right to resign as the TMP by giving 30 days'
written notice to each Partner, provided there is another General Partner
willing to serve in such capacity; if there is no other General Partner then
willing to service in such capacity, the TMP will continue to serve in such
capacity until such time as another General Partner agrees to become the TMP.
Upon the resignation, death, legal incompetency or Bankruptcy of the Person
serving as the TMP, any successor to the interest of the TMP pursuant to the
applicable provisions of this Section 7.9 shall be designated as the successor
TMP, but such designee shall not become the TMP until the designation of such
Person has been approved by the Consent of Special Limited Partner.
C. The TMP shall employ experienced tax counsel to represent the
Partnership in connection with any audit or investigation of the Partnership by
the IRS, and in connection with all subsequent administrative and judicial
proceedings arising out of such audit. The fees and expenses of such counsel
shall be a Partnership expense and shall be paid by the Partnership. Such
counsel shall be responsible for representing the Partnership. General Partner
and Limited Partners, at their respective expense, shall be responsible to pay
the tax counsel employed by such Partner to represent their respective separate
interests.
D. The TMP shall keep the Partners informed of all administrative and
judicial proceedings, as required by Section 6623(g) of the Code, and shall
furnish to each Partner a copy of each notice or other communication received by
the TMP from the IRS (except such notices or communications as are sent directly
to such Partner by the IRS). All third party costs and expenses incurred by the
TMP in serving as the TMP shall be Partnership expenses and shall be paid by the
Partnership, provided, however, that if the Partnership does not have sufficient
funds to pay such costs and expenses, General Partners shall make additional
Capital Contributions to the Partnership to pay such costs and expenses.
E. The TMP shall not have the authority, unless such action has been
approved by the Consent of Special Limited Partner, which Consent may be
withheld or granted in Special Limited Partner's sole and absolute discretion,
to do all or any of the following:
(i) to enter into a settlement agreement with the IRS which purports
to bind Partners other than the TMP,
(ii) to file a petition as contemplated in Section 6226(a) or 6228 of
the Code,
(iii) to intervene in any action as contemplated in Section
6226(b) of the Code,
(iv) to file any request contemplated in Section 6227(b) of the Code,
or
(v) to enter into an agreement extending the period of limitations as
contemplated in Section 6229(b)(1)(B) of the Code.
F. The relationship of the TMP to Limited Partners is that of a
fiduciary, and the TMP has a fiduciary obligation to perform the TMP's duties in
such manner as will serve the best interests of the Partnership and Limited
Partners.
G. The Partnership shall indemnify the TMP (including the officers and
directors of a corporate TMP) against judgments, fines, amounts paid in
settlement, and expenses (including attorneys' fees) reasonably incurred by them
in any civil, criminal or investigative proceeding in which they are involved or
threatened to be involved by reason of being the TMP, provided that the TMP
acted in good faith, within what is reasonably believed to be the scope of the
TMP's authority and for a purpose which the TMP reasonably believed to be in the
best interests of the Partnership or the Partners. The TMP shall not be
indemnified under this provision against any liability to the Partnership or the
Partners to any greater extent than the indemnification allowed by Section 7.7.
The indemnification provided hereunder shall not be deemed exclusive of any
other rights to which those indemnified may be entitled under any applicable
statute, agreement, vote of the Partners, or otherwise.
Section 7.10 Access and Reports
General Partner shall permit Investor Limited Partner and Special Limited
Partner and their representatives to have access to the Project at all
reasonable times during normal business hours and to examine all agreements and
the Plans and Specifications relating to the Project and shall deliver copies
and such reports as may reasonably be required by them. General Partner shall
promptly provide Investor Limited Partner and Special Limited Partner with
copies of all correspondence, notices and reports sent pursuant to and received
under the Project Documents or from any Governmental Authority with respect to
the Project, together with copies of all other correspondence which a prudent
investor would wish to examine in connection with a similar transaction.
Section 7.11 Representations and Warranties of General Partner
General Partner hereby represents, warrants and covenants to and with the
Partnership and Investor Limited Partner and Special Limited Partner that as of
the date of this Agreement:
A. The Partnership is and will be a duly organized limited partnership
validly existing under the laws of the State of Delaware, has and will maintain
all requisite filings and recordings required by any Governmental Authority to
validly transact business in the State of Nebraska as a foreign limited
partnership, and complies with and will comply with all recording and filing
requirements with the proper authorities in the State of Delaware and the State
of Nebraska necessary to establish and maintain the limited liability of
Investor Limited Partner and Special Limited Partner as provided herein.
B. General Partner is and will remain a duly organized corporation
validly existing under the laws of the State of Louisiana, and has and will
maintain all requisite filings required by any Governmental Authority to validly
transact business in the State of Nebraska as a general partner of a foreign
limited partnership, and has and will have full power and authority to perform
General Partner's obligations under the Project Documents and/or this Agreement,
as the case may be.
C. No litigation, demand, investigation, claim or proceeding against the
Partnership or General Partner or any other litigation or proceeding directly
affecting the Project is pending or, to the Best Knowledge of General Partner,
threatened, before any court, administrative agency or other Governmental
Authority which would, if adversely determined, have a material adverse effect
on the Partnership or General Partner, or their respective business or
operations.
D. No default by General Partner or any Affiliate thereof having any
relationship with the Project or the Partnership, in any material respect has
occurred or is continuing (nor has there occurred any continuing event which,
with the giving of notice or the passage of time or both, would constitute such
a default in any material respect) under any of the Project Documents, and the
Project Documents are in full force and effect (except to the extent fully
performed in accordance with their respective terms).
F. All material building, zoning, health, safety, business and other
applicable certificates, permits and licenses necessary to permit the
construction, use, occupancy and operation of the Project have been or will, at
the time required, be obtained and maintained (other than, prior to completion
of the construction or Rehabilitation of the Project or a specified portion
thereof, such as are issuable only on the completion of the construction or
Rehabilitation of the Project or such specified portion thereof); and neither
the Partnership nor General Partner has received any notice or has any knowledge
of any violation with respect to the Project of any law, rule, regulation, order
or decree of any Governmental Authority asserting jurisdiction which would have
a material adverse effect on the Project or the construction, use or occupancy
thereof, except for violations which have been cured and notices or citations
which have been withdrawn or set aside by the issuing agency or by an order of a
court of competent jurisdiction.
G. The Partnership has good and marketable title to the Project, free and
clear of any liens, charges or encumbrances other than the Deed of Trust, Gap
Deed of Trust, Redevelopment Agreement a notice of management agreement filed by
Manager, matters set forth in the Title Policy issued at the Mortgage Loan
Closing, encumbrances the Partnership is permitted to create under the terms of
this Agreement, and mechanics' and materialmen's liens.
H. The execution and delivery of all instruments and the performance of
all acts heretofore or hereafter made or taken or to be made or taken,
pertaining to the Partnership or the Project by General Partner have been or
will be duly authorized by all necessary action, and the consummation of any
such transactions with or on behalf of the Partnership will not constitute a
breach or violation of, or a default under, General Partner's articles of
incorporation, by-laws, or any agreement by which General Partner or any of
General Partner's properties is bound, nor constitute a violation of any law,
administrative regulation or court decree.
I. No Material Default has occurred and/or is continuing.
J. No Event of Bankruptcy has occurred as to General Partner or the
Development Guarantors.
K. General Partner satisfies the Designated Net Worth Standard.
L. General Partner has disclosed all material facts related to the
Project and all material transactions in connection with the Project to Investor
Limited Partner.
M. To the Best Knowledge of General Partner, on the date on which the
Certificate of Occupancy is issued the Project will have no material design,
maintenance or construction defects.
N. There are no mechanic's or materialmen's liens recorded against the
Project or the Property, and, to the Best Knowledge of General Partner, no
Person has threatened to assert or record any such mechanic's or materialmen's
lien.
O. Other than obligations incurred in the ordinary course of business, as
of the date hereof, the Partnership has no material outstanding obligations
except for the Loan Documents, the Gap Loan Documents, the TIF Loan Documents,
the Development Agreement, the Construction and Design Contract, the Management
Agreement, the Incentive Partnership Management Agreement, and the other
material obligations reflected in the Project Documents and this Agreement.
P. The Partnership, except to the extent that the Partnership is
protected by insurance and excluding any risk borne by the Lender, bears the
sole risk of loss if the Project is destroyed or condemned or there is a
diminution in the value of the Project.
Q. The Partnership has not been notified by a federal, state or municipal
agency that the Partnership is in Material Violation of any Hazardous Substance
Laws and that such Material Violation is continuing, nor to the Best Knowledge
of General Partner does such a Material Violation exist, nor is General Partner
aware of a condition which should, in the exercise of due diligence, cause
General Partner to investigate the existence of an environmental condition of
such a nature as described above. As used in this section, the term "Material
Violation" means any violation of a Hazardous Substance Law (1) which
jeopardizes or could jeopardize the ability of the Partnership to develop, own,
or operate the Project for its intended purposes, and (2) the correction of
which will require the Partnership to spend funds beyond those likely to be
available to the Partnership for such purpose in the ordinary course of events.
R. No General Partner, Affiliate of a General Partner, or Person for
whose conduct General Partner is or was legally responsible has ever:
(A) owned, occupied, or operated a Site or Vessel on which any Hazardous
Material was or is stored (except if such storage was or is at all times in
substantial compliance with all laws, ordinances and regulations pertaining
thereto); (B) caused or was legally responsible for any release or threat of
release of any Hazardous Material; or (C) received notification from any
federal, state or other Governmental Authority of (x) any potential, known, or
threat of release of any Hazardous Material from the Project or any other Site
or Vessel owned, occupied, or operated either by General Partner, any Affiliate
of General Partner, or other Person for whose liability General Partner, any
Affiliate of General Partner, or any other Person for whose conduct General
Partner is or was legally responsible which may result in a lien on the Project;
or (y) the incurrence of any expense or loss by any such Governmental Authority
or by any other Person in connection with the assessment, containment, or
removal of any release or threat of release of any Hazardous Material from the
Project or any such Site.
S. To the Best Knowledge of General Partner, and except as described in
the Phase 1 Environmental Site Assessment from G&E Engineering dated November,
1997, and the Phase II Environmental Site Assessment dated October, 1997
prepared by ▇▇▇▇▇▇▇▇-▇▇▇▇▇, true and accurate copies of which has been furnished
to Investor Limited Partner, no Hazardous Material was ever or is now stored on
(except to the extent any such storage was at all times in substantial
compliance with all laws, ordinances, and regulations pertaining thereto),
transported, or disposed of on the Property.
T. The Partnership has no employees other than those working at the
Project and shall have no others.
Section 7.12 Indemnification
A. In the event that General Partner breaches any of General Partner's
representations, warranties or covenants contained in Section 7.11, or if
General Partner acts in bad faith or exceeds the authorities granted to General
Partner under this Agreement, or if General Partner breaches General Partner's
fiduciary duties to the Partnership or to the Limited Partners, General Partner
shall indemnify and hold Limited Partners harmless from and against any and all
Adverse Consequences which either Limited Partner suffers or incurs, or to which
either Limited Partner becomes subject, resulting from, arising out of, relating
to, in the nature of or caused by such breach (including, without limitation,
any recapture of the Historic Rehabilitation Credit occasioned by such action or
omission by the General Partner).
B. If any third party shall notify either Limited Partner with respect to
any matter which may give rise to a claim for indemnification against any
General Partner under this Section 7.12, such Limited Partner shall notify
General Partner thereof promptly; provided, however, that no delay on the part
of such Limited Partner in notifying General Partner shall relieve General
Partner from any liability or obligation hereunder unless (and then solely to
the extent) General Partner thereby is damaged. In the event that General
Partner notifies such Limited Partner within 15 days after such Limited Partner
has given notice of the matter that General Partner is assuming the defense
thereof, (i) General Partner will defend such Limited Partner against the matter
with counsel of General Partner's choice, satisfactory to such Limited Partner,
(ii) such Limited Partner may retain separate co-counsel at such Limited
Partner's sole cost and expense (except that General Partner will be responsible
for the fees and expenses of the separate co-counsel to the extent that such
Limited Partner concludes reasonably that the counsel General Partner has
selected has a conflict of interest), (iii) General Partner will not consent to
the entry of any judgment or enter into any settlement with respect to the
matter without the Consent of such Limited Partner, which Consent, except as
provided below, may be withheld or granted in such Limited Partner's sole and
absolute discretion, provided that the Consent of such Limited Partner to any
proposed judgement or settlement which includes a provision whereby the
plaintiff or claimant in the matter fully releases the Limited Partners from all
liability with respect thereto will not be unreasonably withheld by such Limited
Partner. In the event that General Partner does not notify such Limited Partner
within 15 days after such Limited Partner has given notice of the matter that
General Partner is assuming the defense thereof, such Limited Partner may defend
against, or enter into any settlement with respect to, the matter in any manner
such Limited Partner reasonably may deem to be appropriate and General Partner
shall indemnify such Limited Partner with respect to such matter in accordance
with Section 7.12A.
SECTION 8: REMOVAL OF GENERAL PARTNER
Section 8.1 General
In addition to any other rights granted to Investor Limited Partner
hereunder, Special Limited Partner shall have the right to remove and replace
General Partner in accordance with the provisions of Section 8.3, or to replace
General Partner as Managing General Partner in accordance with the provisions of
Section 7.3C, or to take both such actions in such manner or sequence as Special
Limited Partner determines in its absolute discretion, if a Material Default
occurs.
Section 8.2 Set Off
The Partnership, Investor Limited Partner, and Special Limited Partner will
have a right of setoff against any amount due or owing from the Partnership,
Investor Limited Partner, or Special Limited Partner, as applicable, to General
Partner or any Affiliate of General Partner with respect to any obligation of
General Partner or any Affiliate of General Partner under this Agreement or the
Project Documents. All rights of setoff may be exercised without notice or
demand to General Partner or any Affiliate of General Partner. No right of
setoff will be deemed to have been waived by any act or conduct on the part of
the Partnership, Investor Limited Partner, or Special Limited Partner, or by any
neglect to exercise such right of setoff, or by any delay in doing so. Every
right of setoff will continue in full force and effect until specifically waived
or released by an instrument in writing executed by the Partnership and Special
Limited Partner. Notwithstanding the foregoing, neither the Partnership,
Investor Limited Partner, nor Special Limited Partner may exercise any right of
setoff unless the Partnership, Investor Limited Partner, or Special Limited
Partner, as applicable, at least 10 days prior to the exercise of the right of
setoff, has delivered written notice of such claimed right of setoff to General
Partner, which notice will specify in reasonable detail the basis of the claimed
right of setoff. If General Partner disagrees with the claimed right of setoff,
then, prior to the end of the 10 day period referred to above, General Partner
will deliver to the Partnership, Investor Limited Partner, and Special Limited
Partner written notice setting forth in reasonable detail the reasons why the
claimed right of setoff is not available. If General Partner delivers such
notice, the right of set-off with respect to such contested matter will be
tolled until such contest is settled, provided, however, that unless General
Partner and Special Limited Partner agree to a resolution of such contest within
30 days after the notice by General Partner of such contest, or unless General
Partner has instituted an appropriate action relating to such contest with a
court of appropriate jurisdiction within such 30 day period, then such right of
set off with respect to such contested matter may be exercised as of the end of
such 30 day period.
Section 8.3 Removal of General Partner
A. In the event that Special Limited Partner determines to remove General
Partner pursuant to Section 8.1, Special Limited Partner shall notify General
Partner in writing, within 5 days after such determination, of the Material
Default that is the cause for the removal of General Partner. General Partner
shall have 30 days from receipt of the notice to cure the Material Default;
provided, however, that if a Material Default, other than a monetary default,
cannot be reasonably cured within such 30 days, Special Limited Partner will not
have the right to remove General Partner under 8.1 provided that within such 30
day period General Partner in good faith commences actions which are likely to
cure such Material Default and diligently prosecutes such cure to completion.
If General Partner fails to cure within the specified time period, Special
Limited Partner shall notify General Partner of the effective date of General
Partner's removal promptly after the cure period has expired; provided, however,
in the event the General Partner is removed pursuant to this Section 8.3, the
General Partner shall take such actions and execute such documents as the
Special Limited Partner may reasonably request to reflect such removal. Each
Partner hereby irrevocably appoints Special Limited Partner (with full power of
substitution) as the attorney-in-fact of such Partner for the purpose of
executing, acknowledging, swearing to, recording and/or filing any amendment to
this Agreement necessary or appropriate to confirm the foregoing.
B. If General Partner is removed pursuant to this Section 8.3, the
Partnership shall, subject to Section 8.2, pay to General Partner an amount
equal to (i) the sum of (a) any fees earned and unpaid through the date of
removal due to General Partner or General Partner's Affiliates under
Section 7.5, (b) an amount equal to the General Partner's positive Capital
Account balance, if any, following a deemed sale of the Project and a deemed
liquidation of the Partnership, and (c) the principal balance and any accrued
but unpaid interest on the General Partner's Subordinated Partner Loan, any
Operating Deficit Loans, and any Voluntary General Partner Loans (but prior to
any deemed distributions upon liquidation), minus (ii) an amount equal to the
sum of (x) the amount, as of the date of removal, of any then outstanding
Investor Limited Partner Loans, together with interest on such amounts as of the
date of removal, (y) any indebtedness or amount(s) owed by the General Partner
or any Affiliate of General Partner to any Limited Partner or Affiliate of a
Limited Partner, and (z) any loss or damage suffered by the Partnership or
Limited Partners as a result of the Material Default creating the right of
Special Limited Partner to remove General Partner pursuant to this Section 8.3
other than any such loss or damage which is accounted for pursuant to subsection
(x) above. Within 30 days after the date the General Partner is removed
pursuant to this Section 8.3, or, if later, within 10 days after the date the
fair market value of the Project is determined pursuant to Section 8.3D below,
the General Partner shall pay the amount, if any, by which the aggregate amount
described in (ii)(x), (y) and (z) above exceeds the aggregate amount described
in (i)(a), (b) and (c) above. Amounts paid or credited to the General Partner
pursuant to clause 8.3.B(i)(a) above that are attributable to a fee earned and
unpaid with respect to an Affiliate of the General Partner shall be treated for
all purposes as having been paid to such Affiliate.
C. For purposes of this Section 8.3C, the net proceeds from a deemed sale
of the Project shall be equal to 95% of the fair market value of the Project
plus 97% of the fair market value of all other Partnership property, including
but not limited to cash and cash equivalents as of the date of removal, less the
outstanding balance of the Deed of Trust Loan and any other obligations of the
Partnership to third parties as of the date of removal.
D. The fair market value of the Project as of the date of removal shall
be determined as follows: If the Special Limited Partner and the General
Partner are unable to mutually agree on the fair market value of the Project,
then as soon as practicable and in any event within 30 days following the notice
from Special Limited Partner to General Partner specified in the penultimate
sentence of Section 8.3A above, General Partner and Special Limited Partner
shall select a mutually acceptable independent MAI appraiser to act as a single
appraiser. If the parties are unable to agree upon such an appraiser within
such 30 day period, then, within 30 days following the end of such 30 day
period, General Partner and Special Limited Partner shall each select an MAI
appraiser who has at least 10 years' experience is appraising properties similar
to the Project in the Omaha metropolitan area. If either General Partner or
Special Limited Partner fails to appoint such an appraiser within such time and
if the other party has appointed such an appraiser within such time, then the
appraiser so appointed will be deemed to be a mutually acceptable appraiser to
act as a single appraiser. If two appraisers are so appointed, each appraiser
shall estimate the fair market value of the Project. If the difference between
the two appraisals is within 10% of the lower of the two appraisals, the fair
market value shall be the average of the two appraisals. If the difference
between the two appraisals is greater than 10% of the lower of the two
appraisals, then the two appraisers shall jointly select a third similarly
qualified appraiser whose determination of fair market value shall be deemed
binding on all parties. If the two appraisers are unable jointly to select a
third appraiser, either General Partner or Special Limited Partner may, upon
written notice to the other, apply to the individual who is, at the time, the
most senior in service, active Judge of the United States District Court for the
District of Nebraska for the selection of the third appraiser who shall then
participate in such appraisal proceeding, and who shall be selected from a list
of names of M.A.I. appraisers submitted by General Partner and Special Limited
Partner. Each list of names of appraisers shall be submitted in writing within
10 days after the date on which the appraisal proceeding is invoked, or will be
disregarded and the appraiser shall be selected from the list provided. The
Partnership shall pay the cost of any appraisers selected pursuant to this
Section 8.3D.
E. In the event of the removal of General Partner pursuant to the
provisions of this Section 8.3, any amounts due to General Partner pursuant to
the provisions of Section 8.3B shall be payable solely from the distribution
Refinancing Proceeds which would otherwise have been paid to General Partner as
and when provided under Section 6.2B., Clause Thirteenth, Fourteenth or
Fifteenth (as the case may be) and from Sale Proceeds which would otherwise have
been paid to General Partner as and when provided under Section 6.2C., Clause
Twelfth, Thirteenth or Fourteenth (as the case may be). In addition, in the
event of such removal, with respect to any amounts due to General Partner
pursuant to the provisions of Section 8.3B with respect to the Subordinated
Partner Loan made by General Partner, Voluntary General Partner Loans, and
Operating Deficit Loans, such amounts will also be repaid out of Cash Flow as
and when provided in Clauses Third, Fourth, Fifth, Sixth, and Seventh of Section
6.2.A., respectively.
F. Upon the removal of General Partner, General Partner shall be relieved
of all of General Partner's obligations to the Partnership relating to matters
occurring after the effective date of such removal; provided that General
Partner and General Partner's Affiliates shall remain fully liable for all
matters which relate to any act which occurred prior to the effective date of
such removal.
G. In the event that General Partner is removed pursuant to this Section
8.3, then Special Limited Partner may designate a Person or Persons to become
the successor General Partner or Partners replacing the removed General Partner,
with the approval of any Person required under the Project Documents and
provided that any such successor General Partner or Partners shall agree to be
bound by the Project Documents, and any other documents required in connection
therewith.
SECTION 9: BOOKS AND REPORTING, ACCOUNTING, TAX ELECTIONS, ETC.
Section 9.1 Books and Reporting
A. General Partner shall keep or cause to be kept for the term of the
Partnership a complete and accurate set of books and supporting documentation of
transactions with respect to the conduct of the Partnership's business and all
Partnership information required to be kept pursuant to the Act or any
Governmental Authority. The books of the Partnership shall be kept on the
accrual basis and shall at all times be maintained at the principal office of
the Partnership. Each of the Partners and such Partner's duly authorized
representatives shall have the right to examine the books of the Partnership and
all other records and information concerning the operation of the Project, from
time to time without prior notice during regular business hours provided that
such examination shall not unreasonably disrupt or interfere with the
Partnership's business or operations. The books, records and banks accounts of
the Partnership shall be maintained separate from those of any other Person and
in such a manner that it is not costly or difficult to identify or ascertain
such assets. All property owned by the Partnership shall be owned by the
Partnership in its own name.
B. General Partner shall prepare a balance sheet as of the end of each
such Fiscal Year and statements of income, Partners' equity, and changes in
financial position for such Fiscal Year. Such balance sheet and statements
shall be prepared in accordance with GAAP applied consistently with prior
periods. In addition, after the first Fiscal Year after the Completion Date,
the depreciation schedule for that Fiscal Year and all future Fiscal Years,
together with the depreciation worksheet, shall be prepared by General Partner
or General Partner's designee and furnished to Investor Limited Partner.
Provided that the Manager has timely performed its obligation to provide an
accounting to the Partnership under the Management Agreement, General Partner
shall, promptly upon completion of such balance sheet and statements and in any
event within 120 days after the end of each Fiscal Year, transmit to Special
Limited Partner a copy thereof. In the event the Manager has not timely
performed its obligation to provide an accounting to the Partnership under the
Management Agreement, the General Partner shall, within 15 days after receipt of
such accounting from the Manager, complete such balance sheet and statements and
transmit a copy thereof to the Special Limited Partner. If such financial
statements are not submitted to Special Limited Partner within 120 days after
the end of each Fiscal Year and the Manager has timely performed its obligations
to provide an accounting to the Partnership under the Management Agreement or if
the Manager has not timely performed its obligations to provide an accounting to
the Partnership under the Management Agreement and the General Partner has not
submitted such financial statements within 15 days after the accounting is
received from the Manager, General Partner shall pay to Investor Limited Partner
liquidated damages in the amount of $250 for each day such submittal is late.
At the request of Special Limited Partner, General Partner shall cause the books
of the Partnership to be examined in accordance with generally accepted auditing
standards as of the end of the Fiscal Year for which such request was received
by the Accountants.
C. Provided that the Manager has timely performed its obligation to
provide an accounting to the Partnership under the Management Agreement, General
Partner or General Partner's designee shall complete the books of the
Partnership in such time as to prepare and complete such tax returns and submit
them to the Special Limited Partner for its review and approval at least 21 days
prior to the date such returns are required to be filed under applicable law.
The Special Limited Partner shall notify the General Partner of the completion
of its review of such tax returns and any comments or concerns thereon within 14
days of its receipt thereof. In the event there is any dispute as to matters
set forth in such tax returns, the General Partner and the Special Limited
Partner shall, within 5 days after receipt by the General Partner of such timely
notification by the Special Limited Partner, resolve such comments and concerns,
as provided in Section 9.3 and applicable law; provided, however, upon the
request of Special Limited Partner, the Partnership shall obtain from Special
Counsel or the Accountants, an opinion as to the position taken on such tax
returns with respect to the matters subject to such disagreement between the
General Partner and Special Limited Partner. In the event the Special Limited
Partner and the General Partner are unable to resolve Special Limited Partner's
comments and concerns with respect to such tax returns and/or obtain an opinion
thereon as provided in this Section 9.1C prior to the date such returns are
required to be filed under applicable law or, the Manager has failed to perform
its obligation to provide an accounting to the Partnership under the Management
Agreement in a timely manner, the General Partner shall file an extension with
the applicable Governmental Authority with respect to such tax returns to allow
the parties sufficient time to (i) obtain the requisite information from the
Manager to prepare such returns or (ii) resolve such comments and concerns
and/or obtain such opinion with respect thereto. In any event, General Partner
shall cause such tax returns to be filed within the time periods required by law
(including extensions as provided in this Section 9.1C), forward copies of such
tax returns to the Special Limited Partner for its review and comment as
provided in this Section 9.1(C) no later than 21 days prior to the date such
returns are required to be filed, and shall immediately upon the filing thereof
transmit to the Limited Partners a copy of the complete federal Partnership tax
return (i.e., Form 1065 and all accompanying schedules, including Form K-l) and
all state income tax returns. In the event that any such items will not be
delivered within the time limits set forth herein and the Manager has timely
performed its obligation to provide an accounting to the Partnership under the
Management Agreement, General Partner shall immediately notify the Limited
Partners, shall furnish the Limited Partners with copies of any extensions, and
shall pay to Investor Limited Partner liquidated damages in the amount of $250
for each day such delivery is late.
D. The reports and estimates described in this Section 9.1 shall clearly
indicate the methods under which they were prepared and shall be made at the
expense of the Partnership.
E. General Partner shall provide Special Limited Partner with a copy of
the Operating Projection received from the Manager within 10 days after receipt
of same.
F. General Partner shall send to Special Limited Partner no later than 10
days following receipt by General Partner of the monthly accounting from the
Manager under the Management Agreement a financial report providing the
following information (which need not be audited): (i) a balance sheet of the
Partnership as of the end of such month; and (ii) a statement of income of the
Partnership for such month.
G. During the Initial Operating Period, no later than 90 days following
the end of each Fiscal Year, General Partner shall deliver to Special Limited
Partner a balance sheet and statement of income for General Partner and its
parent HRI, prepared in accordance with GAAP, dated as of end of such Fiscal
Year, which balance sheet must show a combined net worth equal to or greater
than $4,000,000.00.
H. With the Consent of the Investor Limited Partner, General Partner may
from time to time change the Accountants for the Partnership to another firm of
certified independent accountants; provided, however, that prior to any such
change General Partner shall have delivered to Special Limited Partner a
certificate as to whether such change has been brought about as a direct or
indirect result of any dispute over Partnership accounting practices and
procedures.
Section 9.2 Bank Accounts
The bank accounts of the Partnership shall be maintained in such banking
institutions authorized to do business in the State the accounts of which are
insured by the Federal Deposit Insurance Corporation, or, subject to any
Requisite Approvals and to the Consent of Special Limited Partner, in such other
states as General Partner shall determine, except that the bank account for all
funds held by the Manager on behalf of the Partnership and all Reserves required
by the Lender and the Manager shall be maintained at a bank designated by the
Manager. The Partnership's funds shall not be commingled with the funds of any
other Person and shall not be used except for the business of the Partnership.
All deposits (including funds required by the Lender to be placed in escrow and
other funds not needed in the operation of the Partnership's business) shall be
deposited, to the extent permitted under the Project Documents, in
interest-bearing accounts which are insured by the Federal Deposit Insurance
Corporation, or invested in obligations of or guaranteed by the United States,
any state thereof, or any agency, municipality or other political subdivision of
any of the foregoing, commercial paper (investment grade), certificates of
deposit and time deposits in commercial banks with unencumbered capital and
surplus in excess of $50,000,000 and in mutual (money market) funds investing in
any or all of the foregoing; provided, however, that any funds required to be
placed in escrow by the Lender shall be controlled by the Lender and General
Partner shall not be permitted to make any withdrawal from such funds without
the express written consent of the Lender to the extent required and any funds
required to be placed in escrow by the Manager shall be controlled by the
Manager and General Partner shall not be permitted to make any withdrawal from
such funds without the express written consent of the Manager to the extent
required
Section 9.3 Tax Elections
Subject to the provisions of Section 9.4, all elections required or
permitted to be made by the Partnership under the Code shall be made by General
Partner in such manner as General Partner considers to be most advantageous to
Investor Limited Partner.
Section 9.4 Special Adjustments
A. In the event of a Transfer of all or any part of the Partnership
Interest of any Partner, the Partnership shall elect, pursuant to Section 754
of the Code (or corresponding provisions of succeeding law) to adjust the basis
of Partnership assets. Any adjustments made pursuant to Section 754 shall
affect only the successor in interest to the transferring Partner. Each Partner
will furnish the Partnership with all information necessary to give effect to
such election.
B. If, as a result of an adjustment made by the IRS and accepted by the
Partnership any item shall be capitalized, then the depreciation or cost
recovery for the amount so capitalized shall be appropriately allocated, as
determined by the Accountants, to those Partners affected by the adjustment.
Section 9.5 Fiscal Year
The Fiscal Year of the Partnership shall be the calendar year, or such
other year as may be required by the Code.
SECTION 10: WITHDRAWAL OF A GENERAL PARTNER; NEW GENERAL PARTNERS
Section 10.1 Voluntary Withdrawal
A. General Partner shall not have the right to withdraw voluntarily from
the Partnership, Transfer all or a portion of General Partner's Partnership
Interest or permit the transfer of an ownership interest in the General Partner,
without the Consent of Special Limited Partner, which Consent may be withheld or
granted in Special Limited Partner's sole and absolute discretion. Except with
respect to any damages incurred by the Partnership or the other Partners or
purchase or default rights expressly granted to the Partnership or the other
Partners under the terms of this Agreement, any such Transfer or voluntary
withdrawal or purported Transfer or voluntary withdrawal shall be void and
ineffectual and shall not bind, or be recognized by the Partnership.
B. Notwithstanding the foregoing, a General Partner may at any time
propose to Special Limited Partner a Person to serve as such General Partner's
successor, or if at such time there be more than one General Partner, to serve
as a successor to one or more of General Partners desiring to withdraw. If the
Consent of Special Limited Partner is obtained, and all Requisite Approvals are
obtained to such withdrawal and the admission of such successor, all Partners
hereby agree that this Agreement shall be appropriately amended to effect such
withdrawal and admission.
Section 10.2 Obligation to Continue
In the event of the occurrence of a Terminating Event with respect to any
General Partner, the remaining General Partners, if any, and any successor
General Partner, shall have the obligation to elect to continue the business of
the Partnership employing the Partnership's assets and name, all as contemplated
by the laws of the State of Delaware, unless otherwise directed by Special
Limited Partner. Within 10 days after the occurrence of such Terminating Event,
the General Partner subject to such Terminating Event and any remaining General
Partners shall notify Investor Limited Partner and Special Limited Partner
thereof.
Section 10.3 Successor General Partner
A. Upon the occurrence of any Terminating Event referred to in
Section 10.2, the remaining General Partners may (but are not required to)
designate a Person to become a successor General Partner to General Partner as
to whom such event shall have occurred. Any Person so designated, subject to
the Consent of Special Limited Partner, which Consent may be withheld or granted
in Special Limited Partner's sole and absolute discretion (and, if required by
the Act or any other applicable law, the consent of any other Partner so
required), shall become a successor General Partner upon such Person's written
agreement to be bound by the Project Documents and by the provisions of this
Agreement.
B. If any Terminating Event referred to in Section 10.2 shall occur at a
time when there is no remaining General Partner and no successor becomes a
successor General Partner pursuant to the preceding provisions of this Section
10.3, then Special Limited Partner shall have the right to either become a
successor General Partner or to designate a Person to become a successor General
Partner upon such Person's written agreement to be bound by the Project
Documents and by the provisions of this Agreement.
C. If Special Limited Partner elects to reconstitute the Partnership
pursuant to this Section 10.3 and admit a successor General Partner pursuant to
this Section 10.3, the relationship of the parties in the reconstituted
Partnership shall be governed by this Agreement as the same may be amended by
the then Partners in the Partnership.
Section 10.4 Interest of Predecessor General Partner
A. Except as provided in Section 10.3, no assignee or transferee of all
or any part of the Partnership Interest of a General Partner shall have any
automatic right to become a General Partner. Upon the designation of a
successor General Partner (if any) pursuant to Section 10.3, such successor
General Partner shall have the option to acquire the predecessor General
Partner's Partnership Interest by paying to such General Partner or General
Partner's representatives (i) the fair market value of such Partnership
Interest, if such predecessor General Partner was not in violation of any of the
covenants or undertakings contained in this Agreement, or has violated any
representation or warranty contained herein, or, (ii) if such predecessor
General Partner was in violation of any of the covenants or undertakings
contained in this Agreement, or has violated any representation or warranty
contained herein, by paying the amount, if any, due to such predecessor General
Partner under Section 8.3B.
B. If no successor General Partner is designated or if the designated
successor General Partner of the predecessor General Partner does not desire to
purchase the Partnership Interest of the predecessor General Partner, such
Partnership Interest of the predecessor General Partner shall automatically and
without the need for any confirmatory documentation therefor be converted into
that of a Special Class Limited Partner and the holder thereof shall be entitled
only to such rights as the assignee of a Limited Partnership Interest may have
as such under the provisions of Section 11.4, the Act and other applicable laws
of the State.
C. Upon the occurrence of a Terminating Event (other than a Terminating
Event which constitutes a Material Default) as to any General Partner and a
continuation of the Partnership, such General Partner (the "Retired General
Partner") shall be deemed to have automatically Transferred to the remaining
General Partners, in proportion to their respective General Partnership
interests, or, if there shall be no remaining General Partners, then to the
Partnership for the benefit of the remaining Partners, all or such portion of
General Partnership Interest of such Retired General Partner which, when
aggregated with the existing General Partnership Interests of all such remaining
General Partners, if any, will be sufficient to assure such remaining General
Partners and any successor General Partner a 1% interest in all Profits, Losses,
Tax Credits and Distributions of the Partnership under Section 6. No
documentation shall be necessary to effectuate such Transfer, which shall be
automatic. That portion of General Partnership Interest of the Retired General
Partner which shall not have been Transferred pursuant to this Section 10.4C
shall be retained by such Retired General Partner (or pass to legal
representatives of a deceased General Partner) who or which shall have the
status of a Special Class Limited Partner, with the right to receive that share
of the Profits, Losses, Tax Credits, and Distributions of the Partnership to
which the Retired General Partner as such, would have been entitled had such
Terminating Event not occurred, reduced to the extent of General Partnership
Interest transferred hereunder, but such Retired General Partner (or such
Retired General Partner's legal representatives in the case of a deceased
General Partner) shall not be considered to be a Limited Partner for the purpose
of sharing the benefits allocated to the Limited Partners under Section 6 and
shall not participate in the votes or consents of the Limited Partners
hereunder. No consideration shall be paid to such Retired General Partner by
the remaining General Partners or the Partnership in the event of a Transfer
pursuant to this Section 10.4C.
D. For the purposes of Section 6, the effective date of the Transfer
pursuant to the provisions of Section 10.4C of the Partnership Interest of a
Retired General Partner shall be deemed to be the date on which such Terminating
Event occurs.
E. Anything herein contained to the contrary notwithstanding, any General
Partner who withdraws voluntarily in violation of Section 10.1 or who is removed
by Special Limited Partner as provided in this Agreement shall remain liable for
all of such General Partner's obligations under this Agreement, for all of such
General Partner's obligations under the Project Documents, and for all of such
General Partner's other obligations and liabilities hereunder incurred or
accrued prior to the date of such General Partner's withdrawal and for any loss
or damage which the Partnership or any of the Partners may incur as a result of
such withdrawal, except for any loss or damage attributable to the activities of
the remaining and/or successor General Partners subsequent to such withdrawal.
F. The estate (which term, for purposes of this Section 10.4F, shall
include the heirs, distributees, estate, executors, administrators, guardian,
committee, trustee or other personal representative) of a General Partner who is
a natural person as to whom a Terminating Event has occurred shall be and remain
liable for all such General Partner's liabilities and obligations hereunder,
except as provided in this Section 10.4F. In the event of the death, insanity
or incompetency of a General Partner who is a natural person, such General
Partner's estate shall remain liable for all such General Partner's obligations
and liabilities hereunder incurred or accrued prior to the date of such event,
and for any damages arising out of any breach of this Agreement by such General
Partner, but such General Partner's estate shall not have any obligation or
liability on account of the business of the Partnership or the activities of the
other General Partners after such General Partner's death, insanity or
incompetency unless such General Partner's estate elects to become a General
Partner pursuant to Section 10.3A.
Section 10.5 Designation of New General Partners
A. General Partner may, with the written consent of all Partners which
may be given or withheld in such Partners' absolute discretion, at any time
designate one or more new General Partners with such General Partnership
Interest(s) as General Partner may specify.
B. Any new General Partner shall, as a condition to such Person's
admission to the Partnership and of receiving any interest in Partnership
Property, agree to comply with the terms of the Project Documents and by the
provisions of this Agreement to the same extent and on the same terms as any
other General Partner.
Section 10.6 Amendment of Agreement; Approval of Certain Events
A. Upon the admission of a new General Partner or the withdrawal (for any
reason) of a General Partner, pursuant this Section 10, the Schedule shall be
amended to reflect such admission and/or withdrawal, as the case may be, and the
Managing General Partner shall file an amendment to this Agreement reflecting
such admission and/or withdrawal, as the case may be, in the manner and to the
extent required by the Act and all filings to reflect such admission and/or
withdrawal, as the case may be, in the manner and to the extent required under
the laws of the State of Nebraska.
B. Each Partner hereby consents to and authorizes any admission or
substitution of a General Partner or any other transaction, including, without
limitation, the continuation of the Partnership business, which has been
authorized by the requisite Partners under the provisions of this Agreement,
subject to the provisions of Section 10.7, and hereby ratifies and confirms each
amendment of this Agreement necessary or appropriate to give effect to any such
transaction.
Section 10.7 Admission of a General Partner
Notwithstanding any other provisions of this Agreement, no Person (other
than Special Limited Partner pursuant to exercise of Special Limited Partner's
rights under this Agreement) shall be admitted as an additional or successor
General Partner without the written approval of all Persons who are then
Partners.
SECTION 11: TRANSFER OF LIMITED PARTNERSHIP INTERESTS
Section 11.1 Right to Assign
A. Subject to Section 11.2, the Limited Partner shall have the right to
Transfer such Limited Partner's Partnership Interest, or any other interest
which such Limited Partner has in the capital, assets or property of the
Partnership, or to enter into any agreement as a result of which any Person
shall become interested with such Limited Partner in the Partnership, without
the written consent of General Partner.
B. Investor Limited Partner may at any time designate an Affiliate of
Investor Limited Partner, or a partnership in which an Affiliate of Investor
Limited Partner serves as a General Partner, to replace Investor Limited Partner
as the Investor Limited Partnership of the Partnership, in which case Investor
Limited Partner shall automatically assign Investor Limited Partner's interest
to such Entity and withdraw from the Partnership, and such Entity will be
admitted to the Partnership as the substitute Investor Limited Partner.
Section 11.2 Restrictions
A. No Transfer of the Limited Partnership Interest of any Person shall be
made if such Transfer would violate the provisions of Section 13.1 or the terms
of the Management Agreement.
B. In no event shall all or any part of a Limited Partnership Interest be
Transferred to a minor or to an incompetent.
C. General Partner may require as a condition to any Transfer of a
Limited Partnership Interest, that the assignor or assignee (i) assume all costs
incurred by the Partnership in connection therewith, and (ii) furnish General
Partner with an opinion of counsel satisfactory to counsel to the Partnership
that such Transfer complies with applicable federal and state securities laws.
D. Any voluntary Transfer in contravention of any of the provisions of
Section 11.1 or this Section 11.2 shall be void and ineffectual and shall not
bind, or be recognized by, the Partnership.
Section 11.3 Substitute Limited Partners
A. The Limited Partner shall have the right to substitute an Assignee as a
Limited Partner in such Limited Partner's place. Any Substitute Limited Partner
shall, as a condition of receiving any interest in the Partnership, agree to be
bound (to the same extent as such Assignee's assignor was bound) by the Project
Documents and by the provisions of this Agreement.
B. Upon the admission of a Substitute Limited Partner, the Schedule shall
be amended to reflect the name and address of such Substitute Limited Partner
and to eliminate the name and address of such Substitute Limited Partner's
assignor, and an amendment to this Agreement reflecting such admission shall be
filed, if required by the Act, in accordance with the applicable provisions of
the Act. Each Substitute Limited Partner shall execute such instrument or
instruments as shall be required by General Partner to signify such Substitute
Limited Partner's agreement to be bound by all the provisions of this Agreement.
Section 11.4 Assignees
A. In the event of the death or incapacity of any Limited Partner who is a
natural person, such Limited Partner's legal representatives shall have such
rights as are afforded them by the Act. The death of a Limited Partner shall
not dissolve the Partnership.
B. An Assignee of a Limited Partner who does not become a Substitute
Limited Partner in accordance with Section 11.3 shall, if such assignment is in
compliance with the terms of this Agreement, have the right to receive the same
share of Profits, Losses, Tax Credits and Distributions of the Partnership to
which the assigning Limited Partner would have been entitled if no such
assignment had been made by such Limited Partner but, except as otherwise
required under the Act, shall have no other rights granted to the Limited
Partners under this Agreement.
C. Any Limited Partner who shall assign all of such Limited Partner's
Limited Partnership Interest shall cease to be a Limited Partner of the
Partnership, and shall no longer have any rights or privileges or obligations of
a Limited Partner except that, unless and until the Assignee of such Limited
Partner is admitted to the Partnership as a Substitute Limited Partner in
accordance with Section 11.3, said assigning Limited Partner shall retain the
statutory rights and be subject to the statutory obligations of an assignor
limited partner under the Act as well as the obligation to make the Capital
Contributions attributable to the Limited Partnership Interest in question, if
any portion thereof remains unpaid.
D. In the event of any assignment of a Limited Partnership Interest, there
shall be filed with the Partnership a duly executed and acknowledged counterpart
of the instrument making such assignment; such instrument must evidence the
written acceptance of the Assignee to all the terms and provisions of this
Agreement; and if such an instrument is not so filed, the Partnership need not
recognize any such assignment for any purpose.
E. An Assignee of a Limited Partnership Interest who does not become a
Substitute Limited Partner as provided in Section 11.3 and who desires to make a
further assignment of such Assignee's Limited Partnership Interest shall be
subject to the provisions of this Section 11 to the same extent and in the same
manner as any Limited Partner desiring to make an assignment of such Limited
Partner's Limited Partnership Interest.
Section 11.5. Right of First Offer.
(A) If either Limited Partner (the "Selling Party") desires to sell all or
any part of its Limited Partnership Interest to an person not an Affiliate of a
Limited Partner, the Selling Party shall give notice (the "Offer Notice") to the
General Partner describing that portion or all of the Limited Partnership
Interest to be sold (such whole or partial Limited Partnership Interest, as the
case may be, to be hereinafter referred to as the "Offered Interest"). The
General Partner shall have the option (the "Option") to purchase all of the
Offered Interest for the price set forth in the Offer Notice (the "Withdrawal
Price").
(B) The General Partner may elect to exercise the Option by giving written
notice of its election to the Selling Party at any time within 15 days after the
date of the Offer Notice (the "Election Date"). The General Partner's notice of
its election shall set forth a closing date (the "Closing Date") for the
purchase, which shall not be more than 30 days after the date of General
Partner's notice. If the General Partner elects to exercise the Option, the
Withdrawal Price shall be paid in cash on the Closing Date.
(C) If the General Partner fails to exercise the Option, the Selling Party
shall be permitted to offer and sell the Offered Interest to any non-Affiliate
for a period of 1 year after the Election Date at a price not less than the
Withdrawal Price. If the Selling Party does not sell the Offered Interest
within such period, the Selling Party's right to sell the Offered Interest
pursuant to this Section shall cease and terminate and the provisions of this
Section shall began anew with respect to any subsequent sale to which this
Section applies.
SECTION 12: MANAGEMENT AGREEMENT
Section 12.1 General
General Partner shall engage the Manager to manage the Project pursuant to
the Management Agreement. The Manager shall receive a Management Fee of those
amounts payable from time to time by the Partnership to the Manager for
management services. The initial Manager shall be Courtyard Management
Corporation. From and after the Admission Date, the Partnership shall not enter
into any Management Agreement or modify or extend any Management Agreement
unless General Partner shall have obtained the Consent of Special Limited
Partner to such Management Agreement, modification or extension, as the case may
be.
Section 12.2 Management Fee Paid to General Partner and an Affiliate
Should General Partner or an Affiliate thereof perform hotel management
services for the Partnership, hotel management fees shall be paid General
Partner or such Affiliate only for services actually rendered and shall be in a
reasonable and competitive amount.
SECTION 13: GENERAL PROVISIONS
Section 13.1 Restrictions on Transfer
A. No Transfer of any Partnership Interest may be made except in
compliance with the Regulations. General Partner may require as a condition of
any transfer of such Partnership Interest that the transferor furnish an opinion
of counsel reasonably satisfactory to General Partner that the proposed transfer
will comply with applicable federal and state securities laws.
B. Any voluntary Transfer in contravention of any of the provisions of
this Section 13.1 shall be void and ineffective, and shall not bind or be
recognized by the Partnership.
Section 13.2 Notices
Except as otherwise specifically provided herein, all notices, demands or
other communications hereunder shall be in writing and shall be deemed to have
been given on (i) the first business day after delivery to a nationally
recognized overnight delivery service, (ii) the business day on which such is
sent by telecopier or other facsimile transmission, answerback requested, if
such transmission is sent during customary business hours of the recipient and
if the sender telephonically confirms with the recipient receipt of such
transmission, or if sent otherwise, then on the first business following such
transmission on which the sender telephonically confirms with the recipient
receipt of such transmission, or (iii) when delivered personally if such is
delivered during customary business hours of the recipient, or if delivered
otherwise, then on the first business following such delivery, in each case, to
the parties at the addresses set forth below or at such other addresses as such
parties may designate by notice to the Partnership:
(a) If to the Partnership, at the principal office of the Partnership
set forth in Section 2.
(b) If to a Partner, at such Partner's address set forth in the
Schedule, with copies to ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq., ▇▇▇▇▇, Rice & ▇▇▇▇▇▇▇▇, ▇.▇.,
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and ▇▇▇▇ ▇. ▇▇▇▇▇▇,
Esq., ▇▇▇▇▇▇, P.L.C., Suite 3700, ▇▇▇ ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇.
Section 13.3 Word Meanings
The words such as "herein," "hereinafter," "hereof," and "hereunder" refer
to this Agreement as a whole and not merely to a subdivision in which such words
appear unless the context otherwise requires. The singular shall include the
plural and the masculine gender shall include the feminine and neuter, and vice
versa, unless the context otherwise requires. Any references to "Sections" are
to Sections of this Agreement, unless reference is expressly made to a different
document.
Section 13.4 Binding Provisions
The covenants and agreements contained herein shall be binding upon, and
inure to the benefit of, the heirs, legal representatives, successors and
assignees of the respective parties hereto, except in each case as expressly
provided to the contrary in this Agreement.
Section 13.5 Applicable Law
This Agreement shall be construed and enforced in accordance with the
internal laws of the State of Delaware.
Section 13.6 Exhibits and Schedules
A. The Partners acknowledge that the following constitute the exhibits
(the "Exhibits") to this Agreement:
A Admission Date Conditions
B Legal Description of Land
C Second Installment Payment Certificate
D Form of General Partner's Estoppel Certificate
E Final Projections
B. The Partners acknowledge that the following constitutes the Schedule
to this Agreement:
A Capital Contributions
Section 13.7 Counterparts
This Agreement may be executed in several counterparts and all so executed
counterparts shall constitute one agreement binding on all parties hereto,
notwithstanding that all the parties have not signed the original or the same
counterpart.
Section 13.8 Paragraph Titles
Paragraph titles and any table of contents herein are for descriptive
purposes only, and shall not control or alter the meaning of this Agreement as
set forth in the text.
Section 13.9 Separability of Provisions
Each provision of this Agreement shall be considered separable and (a) if
for any reason any provision or provisions herein are determined to be invalid
and contrary to any existing or future law, such invalidity shall not impair the
operation of or affect those portions of this Agreement which are valid, or (b)
if for any reason any provision or provisions herein would cause the Limited
Partners to be bound by the obligations of the Partnership under the laws of the
State as the same may now or hereafter exist, such provision or provisions shall
be deemed void and of no effect.
Section 13.10 Effective Date of Admission
Subject to the provisions of Section 6.5J, Investor Limited Partner shall
be deemed to have been admitted as of the first day of the calendar month in
which the Admission Date occurs, for all purposes of this Agreement, including
the allocation of Profits, Losses and Tax Credits under Section 6.
Section 13.11 Amendment Procedure
A. This Agreement may be amended by a written document signed by all of
the Partners.
B. Notwithstanding any agreement to the contrary contained in this
Agreement, no amendment will be made to this Agreement which will affect the
rights of the Lender or a Governmental Authority under the terms of the Project
Documents, or any other agreement between the Lender and/or a Governmental
Authority and the Partnership, without the prior written approval of the Lender
and/or the Governmental Authority, as the case may be.
IN WITNESS WHEREOF, each of the Partners has executed this Agreement as of
the date first written above.
COUNTERPART SIGNATURE PAGES FOLLOW THIS PAGE
COUNTERPART SIGNATURE PAGE TO FIRST AMENDED AND RESTATED LIMITED PARTNERSHIP
AGREEMENT OF ▇▇▇▇▇▇ RENEWAL LIMITED PARTNERSHIP
GENERAL PARTNER: HRI ▇▇▇▇▇▇ CORPORATION,
a Louisiana corporation
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Duly Authorized Agent
By: ---------------------------
Print Name
Its: Vice President
COUNTERPART SIGNATURE PAGE TO FIRST AMENDED AND RESTATED LIMITED PARTNERSHIP
AGREEMENT OF ▇▇▇▇▇▇ RENEWAL LIMITED PARTNERSHIP
INVESTOR LIMITED PARTNER: AMERUS-BLACKSTONE, L.L.C.
By: AmerUs Life Insurance Company
Its: Member
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
By: ----------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Name: -------------------------
Assistant Secretary
Title: ------------------------
COUNTERPART SIGNATURE PAGE TO FIRST AMENDED AND RESTATED LIMITED PARTNERSHIP
AGREEMENT OF BLACKSTONE HOTEL PARTNER, L.P.
SPECIAL LIMITED PARTNER: AMERUS MANAGEMENT, INC.
/s/ ▇▇▇▇ ▇▇▇▇▇▇
By: ----------------------------
▇▇▇▇ ▇▇▇▇▇▇
Its: Senior Vice President
COUNTERPART SIGNATURE PAGE TO FIRST AMENDED AND RESTATED LIMITED PARTNERSHIP
AGREEMENT OF ▇▇▇▇▇▇ RENEWAL LIMITED PARTNERSHIP
WITHDRAWING LIMITED PARTNER:
/s/ A. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇.
-----------------------------------
A. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇.
ACKNOWLEDGMENT
STATE OF LOUISIANA
PARISH OF ORLEANS
On this 12th day of November, 1997, before me appeared A. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇., to me personally known, who, being by me duly sworn, did say that he the
Withdrawing Limited Partner of Blackstone Hotel Partners, L.P. of HRI ▇▇▇▇▇▇
Corporation, a Delaware corporation, that the foregoing instrument was signed
and sealed on behalf of the corporation by authority of its Board of Directors,
that ------------ acknowledged the instrument to be the free act and deed of the
corporation, and that the corporation has no corporate seal.
------------------------------
NOTARY PUBLIC
ACKNOWLEDGMENT
STATE OF IOWA
COUNTY OF POLK
On this 19th day of November, 1997, before me appeared ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, to me
personally known, who, being by me duly sworn, did say that he is the Assistant
Secretary of AmerUs Life Insurance Company, an Iowa corporation who is the sole
Member of AmerUs-Blackstone, L.L.C., an Iowa limited liability company, that the
foregoing instrument was signed on behalf of the corporation by authority of its
Board of Directors, that ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ in such capacity acknowledged the
instrument to be the free act and deed of the limited liability company.
-----------------------------------------
NOTARY PUBLIC
ACKNOWLEDGMENT
STATE OF IOWA
COUNTY OF POLK
On this 14th day of November, 1997, before me appeared ▇▇▇▇ ▇▇▇▇▇▇, to me
personally known, who, being by me duly sworn, did say that he is the Senior
Vice President of AmerUs Management, Inc., that the foregoing instrument was
signed on behalf of the corporation by authority of its Board of Directors, that
▇▇▇▇ ▇▇▇▇▇▇ as such Senior Vice President acknowledged the instrument to be the
free act and deed of the corporation, and that the corporation has no corporate
seal.
--------------------------------
NOTARY PUBLIC
ACKNOWLEDGMENT
▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇
▇▇ this 12th day of November, 1997, before me appeared A. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇., to me personally known, who, being by me duly sworn, did say that he is the
Withdrawing Limited Partner of Blackstone Hotel Partners, L.P., that the
foregoing instrument was signed and sealed on behalf of the partnership, and
that A. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇., acknowledged the instrument to be the free act and
deed of the partnership.
----------------------------
NOTARY PUBLIC
SCHEDULE A
Capital Contributions
Name and Address of Partners Capital Contribution
HRI ▇▇▇▇▇▇ Corporation $100.00
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Pres Kabacoff
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇
AmerUs-Blackstone, L.L.C. $2,810,000.00
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇ or (▇▇▇) ▇▇▇-▇▇▇▇
AmerUs Management, Inc. $100.00
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇ or (▇▇▇) ▇▇▇-▇▇▇▇
EXHIBIT A
Admission Date Conditions
Exhibit A
Document Status
A. LOAN DOCUMENTS
1. Loan Application/Commitment between GMAC
and BRLP
2. Building Loan Agreement between GMAC and BRLP
3. First Deed of Trust Note by BRLP to GMAC and UCC's
4. Second Deed of Trust Note by BRLP to GMAC
5. First Deed of Trust, Assignment of Lease
and Profits, Security Agreement and Fixture
Filing by BRLP in favor of GMAC
6. Second Deed of Trust, Assignment of Leases
and Profits, Security Agreement and Fixture
Filing by BRLP in favor of GMAC
7. First Guaranty Agreement
8. Second Guaranty Agreement
9. Environmental Indemnity Agreement by BRLP
for benefit of GMAC
10. Assignment of Leases and Profits by BRLP
in favor of GMAC
11. Letter of Credit in favor of GMAC (To Be Delivered Post-Closing)
12. Assignment of Construction Agreements, Plans
and Property Agreements by BRLP to GMAC
13. Design/Builder's Consent to Assignment of
Design/Builder's Contract by HCI
14. Assignment of Licenses, Permits, Approvals and
Warranties by BRLP to GMAC
15. Opinion of Borrower's/Guarantor's Counsel
16. Opinion of Borrower's/Guarantor's Local Counsel
17. Loan Closing Statement
18. Construction Escrow with Title Company between
GMAC and TIC
19. Construction Loan Disbursement Agreement
A. Subsequent Draw Request
B. Sworn Owner's Affidavit
20. Side Letter re: FF&E
21. Architect's Certificate
22. Engineer's Certificate
23. Contractor's Certificate
24. Reimbursement Agreement between Marriott and BRLP
25. Deed of Trust by BRLP in favor of Marriott
26. Side Letter re AmerUs LOC Loan
27. Side Letter re Developer Fee
B. TIF LOAN DOCUMENTS
28. Ordinance enacted by the City of Omaha
29. Redevelopment Agreement between City of
Omaha and HRI
30. Assignment of Redevelopment Agreement from
HRI to BRLP
31. Promissory Note by City of Omaha in favor of BRLP
32. Loan Commitment issued by FNB to BRLP
33. TIF Loan Agreement between FNB and BRLP
34. Promissory Note by BRLP to FNB
35. Letter of Credit in favor of FNB (To be Issued Post Closing)
36. Collateral Assignment and Pledge
Agreement by BRLP in favor to FNB
37. Security and Pledge Agreement by BRLP to FNB
38. Guaranty of Payment
39. UCC-1 Financing Statement (TIF Funds)
40. Opinion of Assistant City Attorney
41. Side Letter Agreement
C. TITLE INSURANCE/SURVEY MATTERS
42. Commitment for Title Insurance issued by FATIC
to BRLP, GMAC, and ▇▇▇▇▇▇▇▇
▇▇. Lender's Title Insurance Policy effective November 17, 1997 issued by
FATIC in favor of GMAC
44. Lender's Title Insurance Policy effective Movember 17, 1997 issued
by FATIC in favor of Marriott
45. Owner's Title Insurance Policy dated November 17, 1997 issued by
FATIC in favor of BRLP
46. Affidavit of Possession by Seller
47. Certificate of Authority from Nebraska
Secretary of State with respect to Seller
48. Survey prepared by Registered
Professional Land Surveyor
49. Construction Funding/Down Date Agreement
50. Copy of current Property Tax Statement
51. Settlement Statement
D. MATTERS RELATING TO BORROWER, GENERAL PARTNER AND HRI
▇▇▇▇▇▇ Renewal Limited Partnership
52. Articles of Limited Partnership of BRLP
53. Certificate of Limited Partnership of BRLP
54. Letter of Intent between HRI and API
55. Delaware and Nebraska Certificates of Good Standing
56. First Amended and Restated Articles of
Limited Partnership of BRLP by and among
HRI-▇▇▇▇▇▇, ABL, and AMI
57. Application/Certification for Registration to
Qualify BRLP as a Foreign Limited Partnership
in Nebraska
58. Tax Opinion Letter from ▇▇▇▇▇▇, P.L.C.
Historic Restoration, Incorporated
59. Omnibus Certificate of Secretary of HRI
60. Application for Registration to Qualify HRI
to Transact Business in Nebraska
61. Louisiana and Nebraska Certificates of Good Standing
62. Resolutions and Authorizations for Project
HRI ▇▇▇▇▇▇ Corporation
63. Omnibus Certificate of Secretary of HRI-▇▇▇▇▇▇
64. Application for Registration to Qualify HRI-▇▇▇▇▇▇
to transact business in Nebraska
65. Louisiana and Nebraska Certificates of Good Standing
66. Certified Resolutions of AMI
67. Organizational documents re ABL
68. Opinion of Borrower's Counsel
69. Guaranty Agreement (General Partner Payment and Performance) HRI to
BRLP, AmerUs-Blackstone, L.L.C. and AmerUs Management, Inc.
70. Security Agreement (General Partner Performance) HRI ▇▇▇▇▇▇
Corporation to AmerUs Management, Inc. and AmerUs-Blackstone, L.L.C.
71. Incentive Partnership Management Agreement between BRLP and HRI
▇▇▇▇▇▇ Corporation
72. Financial Statements from Pres Kabacoff, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and HRI
▇▇▇▇▇▇ Corporation
73. Resolutions and Authorizations for Project
AmerUs Management, Inc.
74. Resolutions and Authorizations for Project
AmerUs-Blackstone, L.L.C.
75. Authorizations and Approvals
E. PROPERTY ACQUISITION AND DISPOSITION
76. Agreement to Purchase and Sell dated
by and between ▇▇▇▇▇▇, Inc. of Omaha
("Seller") and HRI, as amended
77. Assignment of Purchase Agreement by
HRI to BRLP
78. Special Warranty Deed from Seller to BRLP
79. ▇▇▇▇ of Sale from Seller to BHP
80. Corporate Resolution of Seller
81. Certification of Nonforeign Status by Seller
82. Seller's Closing Statement
83. "City" Leases
84. Purchaser's Closing Statement
85. Purchaser's Certificate
F. CONSTRUCTION, DEVELOPMENT, AND MANAGEMENT DOCUMENTS
86. Building Permit No. 5776, issued to
YBRLP by the City
87. Construction Contract by and between BRLP
AND HCI
88. Performance Bond Dual - Obligee executed by
HCI and an AGI insurance company
89. Payment Bond executed by HCI and an AGI
insurance company
90. Development Agreement by and between BRLP
and HRI
91. Development Fee Note by BHP in favor of HRI
92. Development Fee Note Assignment by HRI in
favor of API entity
93. Development Guaranty Agreement by Kabacoff
and ▇▇▇▇▇▇▇▇ in favor of AmerUs
94. Incentive Partnership Management Agreement by
and between BHP and HRI
95. Insurance Certificates
96. Final Projections
G. MATTERS RELATING TO DEVELOPMENT (DUE DILIGENCE)
97. Final Management Agreement by and between BHP and
Courtyard, including all exhibits and amendments
A.Third Mortgage(See 25 above)
B.Reimbursement Agreement(See 24 above)
C.Subordination, Nondisturbance & Attornment Agmt
98. Parts 1 and 2 of National Park Service
Application for Historic Tax Credit
H. PUT LOAN DOCUMENTS
99. Loan Agreement between HRI and AmerUs Life Insurance Company
100. Guaranty Agreement (Subordinate Partner Loans) between President
Kabacoft and ▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇
101. Security Agreement (Put Loan) between HRIB and ▇▇▇▇
102. UCC Filings (Secured Party-AmerUs Life Ins. Co.)
103. Counsel Letter re Pending Lawsuits
104. Acknowledgment of Receipt, Consent and Waiver
I. AMERUS LOC LOAN DOCUMENTS
105. Loan Agreement between ▇▇▇▇▇▇ and AmerUs Life Ins. Co.
106. Promissory Note ($2,064,000 GAP)
107. Promissory Note ($1,519,000 TIF)
108. Guaranty Agreement between HRI and AmerUs Life Ins. Co.
109. Security and Pledge Agreement between ▇▇▇▇▇▇ & AmerUs Life Ins. Co.
EXHIBIT B
Legal Description of Real Estate
THAT PART OF ▇▇▇▇ ▇ ▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇ OF OMAHA AS SURVEYED AND
LITHOGRAPHED IN OMAHA, ▇▇▇▇▇▇▇ COUNTY, NEBRASKA, DESCRIBED AS BEGINNING AT THE
SOUTHEAST CORNER OF BLOCK 101; THENCE S89DEG.56'52" W (ASSUMED BEARING) ON THE
SOUTHERLY LINE OF SAID BLOCK 101 A DISTANCE OF 101.54 FEET TO A POINT OF SAID
SOUTH LINE; THENCE N00DEG.01'52"W A DISTANCE OF 132.70 FEET TO A POINT ON THE
NORTH LINE OF LOT 7 IN SAID BLOCK 101; THENCE N89DEG.58'05"E ON SAID NORTH LINE
A DISTANCE OF 110.50 FEET TO A POINT ON THE EAST SIDE OF SAID BLOCK 101; THENCE
S00DEG.02'41"E ON SAID EAST LINE A DISTANCE OF 132.66 FEET TO THE POINT OF
BEGINNING; CONTAINING A COMPUTED AREA OF 0.337 SQUARE ACRES MORE OR LESS.
AND
BLOCK 100, THE VACATED ALLEY, PART OF 10TH, AND 9TH STREETS, ORIGINAL CITY OF
OMAHA, AS SURVEYED AND LITHOGRAPHED IN OMAHA, ▇▇▇▇▇▇▇ COUNTY, NEBRASKA,
DESCRIBED AS BEGINNING AT THE SOUTHWEST CORNER OF BLOCK 100, THENCE
N00DEG.02'43"W (ASSUMED BEARING), ON THE WEST LINE OF SAID BLOCK, A DISTANCE OF
151.08 FEET; THENCE N89DEG.50'22"W A DISTANCE OF 3.00 FEET; THENCE
N00DEG.02'43"W A DISTANCE OF 67.00 FEET; THENCE S89DEG.58'48"E A DISTANCE OF
3.00 FEET, TO A POINT ON THE WEST LINE OF BLOCK 100; THENCE N00DEG.02'43"W, ON
SAID WEST LINE, A DISTANCE OF 67.15 FEET TO THE ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇;
THENCE N89DEG.59'18"E, ON THE NORTH LINE OF SAID BLOCK, A DISTANCE OF 285.45
FEET, THENCE S00DEG.04'42"E A DISTANCE OF 132.52 FEET; THENCE S89DEG.58'05"W A
DISTANCE OF 20.33 FEET TO A POINT ON THE EAST LINE OF BLOCK 100; THENCE
S00DEG.04'42"E, ON SAID EAST LINE, A DISTANCE OF 107.53 FEET TO A POINT ON THE
NORTHERLY RIGHT-OF-WAY LINE OF ▇▇▇▇▇▇▇ STREET; THENCE S44DEG.56'05"W, ON SAID
RIGHT-OF-WAY LINE, A DISTANCE OF 7.07 FEET; THENCE CONTINUING ON SAID ▇▇▇▇▇-▇▇-
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇.▇▇'▇▇"▇, A DISTANCE OF 49.34 FEET; THENCE S81DEG.26'59"W, A
DISTANCE OF 148.58 FEET; THENCE S00DEG.03'08"E, A DISTANCE OF 3.00 FEET TO A
POINT ON THE SOUTH LINE OF BLOCK 100; THENCE S89DEG.56'52"W, ON SAID SOUTH LINE,
A DISTANCE OF 66.32 FEET TO THE POINT OF BEGINNING; CONTAINING A COMPUTED AREA
OF 1.716 ACRES, MORE OR LESS.
VACATED ▇▇▇▇ ▇▇▇▇▇▇:
THAT PART OF 10TH STREET, ORIGINAL CITY OF OMAHA, AS SURVEYED AND LITHOGRAPHED
IN OMAHA, ▇▇▇▇▇▇▇ COUNTY, NEBRASKA, DESCRIBED AS COMMENCING AT THE SOUTHWEST
CORNER OF BLOCK 100, THENCE N00DEG.02'43"W (ASSUMED BEARING), ON THE WEST LINE
OF SAID BLOCK 100, A DISTANCE OF 151.08 FEET TO THE POINT OF BEGINNING, THENCE
N89DEG.50'22"W A DISTANCE OF 3.00 FEET; THENCE N00DEG.02.43"W A DISTANCE OF
67.00 FEET; THENCE S89DEG.58'48"E A DISTANCE OF 3.00 FEET TO A POINT ON THE WEST
LINE OF BLOCK 100; THENCE S00DEG.02'43"E, ON SAID WEST LINE, 67.00 FEET TO THE
POINT OF BEGINNING; CONTAINING A COMPUTED AREA OF 0.005 ACRES, MORE OR LESS.
VACATED ▇▇▇ ▇▇▇▇▇▇:
THAT PART OF 9TH STREET, ORIGINAL CITY OF OMAHA, AS SURVEYED AND LITHOGRAPHED IN
OMAHA, ▇▇▇▇▇▇▇ COUNTY, NEBRASKA, DESCRIBED AS BEGINNING AT THE NORTHEAST CORNER
OF BLOCK 100, THENCE N89DEG.59'18" E (ASSUMED BEARING), ON THE NORTH LINE OF
SAID BLOCK 100, A DISTANCE OF 20.33 FEET; THENCE S00DEG.04'42"E A DISTANCE OF
132.52 FEET; THENCE S89DEG.58'05"W A DISTANCE OF 20.33 FEET TO A POINT ON THE
EAST LINE OF BLOCK 100; THENCE N00DEG.04'42"W, ON SAID EAST LINE A DISTANCE OF
132.52 FEET TO THE POINT OF BEGINNING; CONTAINING A COMPUTED AREA OF 0.062
ACRES, MORE OR LESS.
EXHIBIT C
Second Installment Payment Certificate
EXHIBIT D
Form of Estoppel Certificate
ESTOPPEL CERTIFICATE
------------------, 19---
AmerUs-Blackstone, L.L.C.
c/o AmerUs Management, Inc.
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Gentlemen:
The undersigned, as the sole General Partner (the "General Partner")
of ▇▇▇▇▇▇ Renewal Limited Partnership, a Delaware limited partnership (the
"Partnership") operating pursuant to a "First Amended and Restated Limited
Partnership Agreement" dated November ---, 1997 (the "Partnership Agreement").
The Partnership is currently indebted to GMAC Commercial Mortgage Corporation
("Lender") as the holder of a promissory note in the original principal amount
of $14,175,000 (the "Note"), which is secured by a mortgage, deed of trust and
security agreement dated November ---, 1997, and recorded in the office for the
recording of such documents in ▇▇▇▇▇▇▇ County, Nebraska in Volume -----------,
at page ------------ (the "First Mortgage"). The First Mortgage encumbers the
property situate as Block 100 and a portion of lots 7 and 8, Block 101, in
downtown Omaha, Nebraska (the "Property"). The Note, First Mortgage and all
other instruments and documents evidencing, securing or supporting the loan
evidenced by the Note (the "Lender's Loan") are collectively called the
"Lender's Loan Documents." The Partnership is currently indebted to First
National Bank of Omaha under the "TIF Loan Documents" (as that term is defined
in the Partnership Agreement".
Pursuant to the terms of Section 5.1 [5.14] of the Partnership Agreement,
you are making the [Second Installment of your Capital Contribution] [a
Subordinated Partner Loan] to the Partnership in the original principal amount
of $--------------- on the terms and conditions set forth therein (the "Capital
Transaction").
In connection with the Capitol Transaction, General Partner hereby certifies
to Limited Partner that as of the date hereof:
1.There does not presently exist any default or event of default under the
Note, First Mortgage or any of the Lender's Loan Documents, nor has any event or
circumstance occurred which, with the giving of notice or lapse of time, or
both, would constitute such a default or event of default.
2.There have been no amendments to the First Mortgage or the Note as of the
date hereof.
3.The outstanding principal balance of the Note as of -----------------,
199--, is $--------------------.
4.Interest on the Note has been paid through -----------------, 199--.
5.There does not presently exist any default or event of default under the
TIF Loan Documents, nor has any event or circumstance occurred which, with the
giving of notice or lapse of time, or both, would constitute such a default or
event of default.
6.There have been no amendments to the TIF Loan Documents as of the date
hereof.
▇.▇▇ default by the General Partner in any material respect has occurred
under the Partnership Agreement or is continuing (nor has there occurred any
continuing event which, with the giving of notice or the passage of time or
both, would constitute such a default by the General Partner or its Affiliates
in any material respect under any document relating to the Project.
▇.▇▇ the best knowledge of the undersigned, no default by any Limited
General Partner in any material respect has occurred under the Partnership
Agreement or is continuing (nor has there occurred any continuing event which,
with the giving of notice or the passage of time or both, would constitute such
a default by a Limited Partner or its Affiliates in any material respect under
any document relating to the Project and the Partnership Agreement is in full
force and effect according to the terms thereof.
9.All conditions precedent to the making of the Capital Transaction as
specified in Section [5.2] [5.14] of the Partnership Agreement have been
satisfied as evidenced by the exhibits attached hereto.
This letter shall inure to the benefit of each Limited Partner and its
successors and assigns and shall be binding upon the Partnership, the General
Partner, their successors and assigns. Each Limited Partner may rely upon this
letter in extending the funds comprising the Capital Transactions.
HRI ▇▇▇▇▇▇ Corporation, a Louisiana corporation
By:--------------------------------------
Title:-----------------------------------
"GENERAL PARTNER"
EXHIBIT E
Projections
Copy Of Document Follows This Page
Index of Defined Terms
Page
Defined Term Number
Accountants . . . . . . . . . . . . . . . . . . . . . . . . .1
Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
Adjusted Capital Account Deficit. . . . . . . . . . . . . . .2
Admission Date. . . . . . . . . . . . . . . . . . . . . . . .2
Admission Date Conditions . . . . . . . . . . . . . . . . . .2
Adverse Consequences. . . . . . . . . . . . . . . . . . . . .2
Affiliate . . . . . . . . . . . . . . . . . . . . . . . . . .2
Agreement . . . . . . . . . . . . . . . . . . . . . . . . . .2
Allocation Regulations. . . . . . . . . . . . . . . . . . . .2
Any . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Assignee. . . . . . . . . . . . . . . . . . . . . . . . . . .3
Assignment of Construction Agreement, Plans and Property Agree3
Assignment of Interior Design Agreement . . . . . . . . . . .3
Assignment of Purchase Agreement. . . . . . . . . . . . . . .3
Assignment of Redevelopment Agreement . . . . . . . . . . . .3
Base Management Fee . . . . . . . . . . . . . . . . . . . . .3
Best Knowledge. . . . . . . . . . . . . . . . . . . . . . . .3
▇▇▇▇ of Sale. . . . . . . . . . . . . . . . . . . . . . . . .3
Bridge Loan . . . . . . . . . . . . . . . . . . . . . . . . .3
Building Loan Agreement . . . . . . . . . . . . . . . . . . .3
Capital Account . . . . . . . . . . . . . . . . . . . . . . .3
Capital Contribution. . . . . . . . . . . . . . . . . . . . .4
Capital Proceeds. . . . . . . . . . . . . . . . . . . . . . .4
Capital Transaction . . . . . . . . . . . . . . . . . . . . .4
Cash Collateral Fund. . . . . . . . . . . . . . . . . . . . .4
Cash Flow . . . . . . . . . . . . . . . . . . . . . . . . . .5
Cash Receipts . . . . . . . . . . . . . . . . . . . . . . . .5
Certificate of Occupancy. . . . . . . . . . . . . . . . . . .5
City. . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
City Lease. . . . . . . . . . . . . . . . . . . . . . . . . .5
City Lease Bond . . . . . . . . . . . . . . . . . . . . . . .5
Claim . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
Claim Notice. . . . . . . . . . . . . . . . . . . . . . . . .6
Closing Date. . . . . . . . . . . . . . . . . . . . . . . . 88
Code. . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
Commercial Space. . . . . . . . . . . . . . . . . . . . . . .6
Commercial Space Expenses . . . . . . . . . . . . . . . . . .6
Commercial Space Lease. . . . . . . . . . . . . . . . . . . .6
Commercial Space Lease Rent . . . . . . . . . . . . . . . . .6
Completion Date . . . . . . . . . . . . . . . . . . . . . . .6
Consent of Special Limited Partner. . . . . . . . . . . . . .6
Construction and Design Contract. . . . . . . . . . . . . . .6
Construction Consulting and Management Fee. . . . . . . . . .6
Contractor. . . . . . . . . . . . . . . . . . . . . . . . . .7
County. . . . . . . . . . . . . . . . . . . . . . . . . . . .7
Dated . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Debt Service. . . . . . . . . . . . . . . . . . . . . . . . .7
Debt Service Coverage Loan. . . . . . . . . . . . . . . . . .7
Debt Service Deficiency Loan. . . . . . . . . . . . . . . . .7
Deed. . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
Deed of Trust . . . . . . . . . . . . . . . . . . . . . . . .7
Deed of Trust Note. . . . . . . . . . . . . . . . . . . . . .7
Deficit Restoration Obligation. . . . . . . . . . . . . . . .7
Depreciation. . . . . . . . . . . . . . . . . . . . . . . . .7
Designated Interest Rate. . . . . . . . . . . . . . . . . . .8
Developer . . . . . . . . . . . . . . . . . . . . . . . . . .8
Development Agreement . . . . . . . . . . . . . . . . . . . .8
Development Budget. . . . . . . . . . . . . . . . . . . . . .8
Development Fee . . . . . . . . . . . . . . . . . . . . . . .8
Development Fee Note. . . . . . . . . . . . . . . . . . . . .8
Development Fee Note Assignment . . . . . . . . . . . . . . .8
Development Guarantors. . . . . . . . . . . . . . . . . . . .8
Development Guaranty Agreement. . . . . . . . . . . . . . . .8
Distribution. . . . . . . . . . . . . . . . . . . . . . . . .9
Election Date . . . . . . . . . . . . . . . . . . . . . . . 88
Entity. . . . . . . . . . . . . . . . . . . . . . . . . . . .9
Environmental Indemnity Agreement . . . . . . . . . . . . . .9
Event of Bankruptcy . . . . . . . . . . . . . . . . . . . . .9
Event of Force Majeure. . . . . . . . . . . . . . . . . . . .9
Excess Adjustment . . . . . . . . . . . . . . . . . . . . . 10
Excess Adjustment Loan(s) . . . . . . . . . . . . . . . . . 10
Excess Expenses . . . . . . . . . . . . . . . . . . . . . . 10
Exhibits. . . . . . . . . . . . . . . . . . . . . . . . . . 10
Filing Office . . . . . . . . . . . . . . . . . . . . . . . 10
Final Determination . . . . . . . . . . . . . . . . . . . . 10
First Installment . . . . . . . . . . . . . . . . . . . . . 10
Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . 10
Force Majeure . . . . . . . . . . . . . . . . . . . . . . . .9
GAAP. . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Gap Deed of Trust . . . . . . . . . . . . . . . . . . . . . 11
Gap Loan. . . . . . . . . . . . . . . . . . . . . . . . . . 11
Gap Loan Closing. . . . . . . . . . . . . . . . . . . . . . 11
Gap Loan Documents. . . . . . . . . . . . . . . . . . . . . 11
Gap Note. . . . . . . . . . . . . . . . . . . . . . . . . . 11
General Partner . . . . . . . . . . . . . . . . . . . . . . 11
General Partner Pledge. . . . . . . . . . . . . . . . . . . 11
Governmental Authority. . . . . . . . . . . . . . . . . . . 11
Gross Asset Value . . . . . . . . . . . . . . . . . . . . . 11
Gross Hotel Revenues. . . . . . . . . . . . . . . . . . . . 12
Guaranty Agreement. . . . . . . . . . . . . . . . . . . . . 12
Hazardous Material. . . . . . . . . . . . . . . . . . . . . 12
Hazardous Substance Laws. . . . . . . . . . . . . . . . . . 13
HCI . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Historic Credit Determination . . . . . . . . . . . . . . . 13
Historic Rehabilitation Credit. . . . . . . . . . . . . . . 13
Hotel . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Hotel Expenses. . . . . . . . . . . . . . . . . . . . . . . 13
HRI . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
HRI-▇▇▇▇▇▇. . . . . . . . . . . . . . . . . . . . . . . . . 13
Improvements. . . . . . . . . . . . . . . . . . . . . . . . 13
Incentive Hotel Management Fee. . . . . . . . . . . . . . . 13
Incentive Partnership Management Agreement. . . . . . . . . 13
Incentive Partnership Management Fee. . . . . . . . . . . . 14
Initial Operating Period. . . . . . . . . . . . . . . . . . 14
Installment . . . . . . . . . . . . . . . . . . . . . . . . 14
Interior Design Agreement . . . . . . . . . . . . . . . . . 14
Investment Servicing Fee. . . . . . . . . . . . . . . . . . 14
Investor Limited Partner. . . . . . . . . . . . . . . . . . 14
Investor Limited Partner Loan(s). . . . . . . . . . . . . . 14
IRS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Land. . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Lender. . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Letter of Credit. . . . . . . . . . . . . . . . . . . . . . 15
LIBOR . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Limited Partner(s). . . . . . . . . . . . . . . . . . . . . 15
Limited Partnership Interest. . . . . . . . . . . . . . . . 15
Loan Documents. . . . . . . . . . . . . . . . . . . . . . . 15
Management Agreement. . . . . . . . . . . . . . . . . . . . 15
Management Fee. . . . . . . . . . . . . . . . . . . . . . . 16
Manager . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Managing General Partner. . . . . . . . . . . . . . . . . . 16
Material Default. . . . . . . . . . . . . . . . . . . . . . 16
Material Violation. . . . . . . . . . . . . . . . . . . . . 18
Mortgage Loan . . . . . . . . . . . . . . . . . . . . . . . 18
Mortgage Loan Closing . . . . . . . . . . . . . . . . . . . 18
Mortgage Loan Extension Privilege . . . . . . . . . . . . . 18
Negative Completion Adjuster. . . . . . . . . . . . . . . . 18
Negative Historic Adjustment. . . . . . . . . . . . . . . . 18
Negative Historic Credit Difference . . . . . . . . . . . . 18
Net Hotel Revenues. . . . . . . . . . . . . . . . . . . . . 18
Net Restaurant Lease Rent . . . . . . . . . . . . . . . . . 19
Nonrecourse Debt or Nonrecourse Liability . . . . . . . . . 19
Nonrecourse Deductions. . . . . . . . . . . . . . . . . . . 19
Off-Site Parking Facility . . . . . . . . . . . . . . . . . 19
Offered Interest. . . . . . . . . . . . . . . . . . . . . . 88
Operating Deficit . . . . . . . . . . . . . . . . . . . . . 19
Operating Deficit Loan Maximum. . . . . . . . . . . . . . . 19
Operating Deficit Loan(s) . . . . . . . . . . . . . . . . . 19
Operating Profits or Losses . . . . . . . . . . . . . . . . 19
Operating Projection. . . . . . . . . . . . . . . . . . . . 19
Operating Reserve . . . . . . . . . . . . . . . . . . . . . 20
Option. . . . . . . . . . . . . . . . . . . . . . . . . . . 88
Parking Facility. . . . . . . . . . . . . . . . . . . . . . 20
Partner . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Partner Nonrecourse Debt. . . . . . . . . . . . . . . . . . 20
Partner Nonrecourse Debt Minimum Gain . . . . . . . . . . . 20
Partner Nonrecourse Deductions. . . . . . . . . . . . . . . 20
Partnership . . . . . . . . . . . . . . . . . . . . . . . . 20
Partnership Counsel . . . . . . . . . . . . . . . . . . . . 20
Partnership Interest. . . . . . . . . . . . . . . . . . . . 20
Partnership Items . . . . . . . . . . . . . . . . . . . . . 20
Partnership Minimum Gain. . . . . . . . . . . . . . . . . . 20
Partnership Property. . . . . . . . . . . . . . . . . . . . 20
Partnership Reserves. . . . . . . . . . . . . . . . . . . . 20
Payment Certificate . . . . . . . . . . . . . . . . . . . . 21
Person. . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Personal Property . . . . . . . . . . . . . . . . . . . . . 21
Placed-in-Service Date. . . . . . . . . . . . . . . . . . . 21
Plans and Specifications. . . . . . . . . . . . . . . . . . 21
Positive Completion Adjuster. . . . . . . . . . . . . . . . 21
Positive Historic Adjustment. . . . . . . . . . . . . . . . 21
Positive Historic Credit Difference . . . . . . . . . . . . 21
Priority Amount . . . . . . . . . . . . . . . . . . . . . . 21
Profits or Losses . . . . . . . . . . . . . . . . . . . . . 22
Profits or Losses from a Capital Transaction. . . . . . . . 22
Project . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Project Documents . . . . . . . . . . . . . . . . . . . . . 23
Project Expenses. . . . . . . . . . . . . . . . . . . . . . 23
Projections . . . . . . . . . . . . . . . . . . . . . . . . 23
Purchase Agreement. . . . . . . . . . . . . . . . . . . . . 23
Put Loan Documents. . . . . . . . . . . . . . . . . . . . . 23
Real Property . . . . . . . . . . . . . . . . . . . . . . . 23
Recapture Event . . . . . . . . . . . . . . . . . . . . . . 23
Redevelopment Agreement . . . . . . . . . . . . . . . . . . 23
Redevelopment Note. . . . . . . . . . . . . . . . . . . . . 23
Refinancing Proceeds. . . . . . . . . . . . . . . . . . . . 23
Regulations . . . . . . . . . . . . . . . . . . . . . . . . 24
Regulatory Allocations. . . . . . . . . . . . . . . . . . . 24
Rehabilitation. . . . . . . . . . . . . . . . . . . . . . . 24
Reimbursement Agreement . . . . . . . . . . . . . . . . . . 24
Related Person. . . . . . . . . . . . . . . . . . . . . . . 24
Replacement Reserve . . . . . . . . . . . . . . . . . . . . 24
Repurchase Event. . . . . . . . . . . . . . . . . . . . . . 24
Requisite Approvals . . . . . . . . . . . . . . . . . . . . 24
Restaurant Lease Rent . . . . . . . . . . . . . . . . . . . .6
Retired General Partner . . . . . . . . . . . . . . . . . . 24
Sale Proceeds . . . . . . . . . . . . . . . . . . . . . . . 24
Schedule. . . . . . . . . . . . . . . . . . . . . . . . . . 24
Second Installment. . . . . . . . . . . . . . . . . . . . . 24
Seller. . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Share of Partner Nonrecourse Debt Minimum Gain. . . . . . . 24
Share of Partnership Minimum Gain . . . . . . . . . . . . . 25
Site. . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Special Class Limited Partner . . . . . . . . . . . . . . . 25
Special Counsel . . . . . . . . . . . . . . . . . . . . . . 25
Special Limited Partner . . . . . . . . . . . . . . . . . . 25
State . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Subordinated Partner Loan(s). . . . . . . . . . . . . . . . 25
Substitute Limited Partner. . . . . . . . . . . . . . . . . 25
Substitute Partner. . . . . . . . . . . . . . . . . . . . . 25
Tax Credits . . . . . . . . . . . . . . . . . . . . . . . . 25
Tax Financing Documents . . . . . . . . . . . . . . . . . . 25
Temporary Certificate of Occupancy. . . . . . . . . . . . . 26
Temporary Certificate of Occupancy Date . . . . . . . . . . 26
Terminating Capital Transaction . . . . . . . . . . . . . . 26
Terminating Event . . . . . . . . . . . . . . . . . . . . . 26
The . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Third Deed of Trust . . . . . . . . . . . . . . . . . . . . 26
TIF Advance Loan. . . . . . . . . . . . . . . . . . . . . . 26
TIF Advance Loan Closing. . . . . . . . . . . . . . . . . . 26
TIF Letter of Credit. . . . . . . . . . . . . . . . . . . . 27
TIF Loan Agreement. . . . . . . . . . . . . . . . . . . . . 27
TIF Loan Documents. . . . . . . . . . . . . . . . . . . . . 27
Title Policy. . . . . . . . . . . . . . . . . . . . . . . . 27
TMP . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Transfer. . . . . . . . . . . . . . . . . . . . . . . . . . 27
Vessel. . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Voluntary General Partner Loan. . . . . . . . . . . . . . . 27
Withdrawal Price. . . . . . . . . . . . . . . . . . . . . . 88
Working Capital Reserve . . . . . . . . . . . . . . . . . . 28