SECOND AMENDED AND RESTATED
 
AGREEMENT OF LIMITED PARTNERSHIP
 
OF
 
CENTRAL ENERGY PARTNERS LP
 
 
 

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TABLE OF CONTENTS
 

     
PAGE
 
ARTICLE I           DEFINITIONS
       
SECTION 1.1
Definitions
 
1
SECTION 1.2
Construction
 
18
 
ARTICLE II           ORGANIZATION
       
SECTION 2.1
Formation
 
18
SECTION 2.2
Name
 
18
SECTION 2.3
Registered Office; Registered Agent; Principal Office; Other Offices
 
18
SECTION 2.4
Purpose and Business
 
19
SECTION 2.5
Powers
 
19
SECTION 2.6
Power of Attorney
 
19
SECTION 2.7
Term
 
20
SECTION 2.8
Title to Partnership Assets
 
21
SECTION 2.9
Certain Undertakings Relating to the Separateness
 
21
 
ARTICLE III           RIGHTS OF LIMITED PARTNERS
       
SECTION 3.1
Limitation of Liability
 
22
SECTION 3.2
Management of Business
 
22
SECTION 3.3
Outside Activities of the Limited Partners
 
23
SECTION 3.4
Rights of Limited Partners
 
23
 
ARTICLE IV           CERTIFICATES; RECORD HOLDERS; TRANSFER OF PARTNERSHIP
INTERESTS; REDEMPTION OF PARTNERSHIP INTERESTS
       
SECTION 4.1
Certificates
 
24
SECTION 4.2
Mutilated, Destroyed, Lost or Stolen Certificates
 
24
SECTION 4.3
Record Holders
 
25
SECTION 4.4
Transfer Generally
 
25
SECTION 4.5
Registration and Transfer of Limited Partner Interests
 
26
SECTION 4.6
Transfer of the General Partner’s General Partner Interest
 
27
SECTION 4.7
Transfer of Incentive Distribution Rights
 
27
SECTION 4.8
Restrictions on Transfers
 
27
SECTION 4.9
Eligibility Certificates; Ineligible Holders
 
29
SECTION 4.10
Redemption of Partnership Interests of Ineligible Holders
 
30
 
ARTICLE V           CAPITAL CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS
       
SECTION 5.1
Organizational Contributions
 
31
SECTION 5.2
Contributions by the General Partner and its Affiliates
 
31
SECTION 5.3
Interest and Withdrawal
 
32
SECTION 5.4
Capital Accounts
 
32
SECTION 5.5
Issuances of Additional Partnership Interests
 
34
SECTION 5.6
Limited Preemptive Right
 
35
SECTION 5.7
Splits and Combinations
 
36
SECTION 5.8
Fully Paid and Non-Assessable Nature of Limited Partner Interests
 
36

 
 
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SECTION 5.9
Issuance of Common Units in Connection with Reset of Incentive Distribution
Rights
 
37
 
ARTICLE VI           ALLOCATIONS AND DISTRIBUTIONS
       
SECTION 6.1
Allocations for Capital Account Purposes
 
38
SECTION 6.2
Allocations for Tax Purposes
 
46
SECTION 6.3
Requirement and Characterization of Distributions; Distributions to Record
Holders
 
49
SECTION 6.4
Distributions of Available Cash from Operating Surplus
 
50
SECTION 6.5
Distributions of Available Cash from Capital Surplus
 
50
SECTION 6.6
Adjustment of Minimum Quarterly Distribution and Target Distribution Levels
 
51
SECTION 6.7
Special Provisions Relating to the Holders of Incentive Distribution Rights
 
51
SECTION 6.8
Entity-Level Taxation
 
51
 
ARTICLE VII           MANAGEMENT AND OPERATION OF BUSINESS
       
SECTION 7.1
Management
 
52
SECTION 7.2
Certificate of Limited Partnership
 
54
SECTION 7.3
Restrictions on the General Partner’s Authority
 
54
SECTION 7.4
Reimbursement of the General Partner
 
54
SECTION 7.5
Outside Activities
 
55
SECTION 7.6
Loans from the General Partner; Loans or Contributions from the Partnership;
Contracts with Affiliates; Certain Restrictions on the General Partner
 
56
SECTION 7.7
Indemnification
 
58
SECTION 7.8
Liability of Indemnitees
 
59
SECTION 7.9
Resolution of Conflicts of Interest
 
60
SECTION 7.10
Other Matters Concerning the General Partner
 
62
SECTION 7.11
Purchase or Sale of Partnership Interests
 
62
SECTION 7.12
Registration Rights of the General Partner and its Affiliates
 
62
 
ARTICLE VIII           BOOKS, RECORDS, ACCOUNTING AND REPORTS
       
SECTION 8.1
Records and Accounting
 
63
SECTION 8.2
Fiscal Year
 
63
SECTION 8.3
Reports
 
63
 
ARTICLE IX           TAX MATTERS
       
SECTION 9.1
Tax Returns and Information
 
64
SECTION 9.2
Tax Elections
 
64
SECTION 9.3
Tax Controversies
 
64
SECTION 9.4
Withholding; Tax Payments
 
64
 
ARTICLE X           ADMISSION OF PARTNERS
       
SECTION 10.1
Admission of Limited Partners
 
65
SECTION 10.2
Admission of Substituted Limited Partners
 
66
SECTION 10.3
Admission of Successor General Partner
 
66
SECTION 10.4
Amendment of Agreement and Certificate of Limited Partnership
 
66

 
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ARTICLE XI           WITHDRAWAL OR REMOVAL OF PARTNERS
       
SECTION 11.1
Withdrawal of the General Partner
 
66
SECTION 11.2
Removal of the General Partner
 
68
SECTION 11.3
Interest of Departing General Partner and Successor General Partner
 
68
SECTION 11.4
Withdrawal of Limited Partners
 
70
 
ARTICLE XII           DISSOLUTION AND LIQUIDATION
       
SECTION 12.1
Dissolution
 
70
SECTION 12.2
Continuation of the Business of the Partnership After Dissolution
 
70
SECTION 12.3
Liquidator
 
71
SECTION 12.4
Liquidation
 
71
SECTION 12.5
Cancellation of Certificate of Limited Partnership
 
72
SECTION 12.6
Return of Contributions
 
72
SECTION 12.7
Waiver of Partition
 
72
SECTION 12.8
Capital Account Restoration
 
72
 
ARTICLE XIII           AMENDMENT OF PARTNERSHIP AGREEMENT;
MEETINGS; RECORD DATE
       
SECTION 13.1
Amendments to be Adopted Solely by the General Partner
 
73
SECTION 13.2
Amendment Procedures
 
74
SECTION 13.3
Amendment Requirements
 
75
SECTION 13.4
Special Meetings
 
75
SECTION 13.5
Notice of a Meeting
 
76
SECTION 13.6
Record Date
 
76
SECTION 13.7
Adjournment
 
76
SECTION 13.8
Waiver of Notice; Approval of Meeting; Approval of Minutes
 
76
SECTION 13.9
Quorum
 
77
SECTION 13.10
Conduct of a Meeting
 
77
SECTION 13.11
Action Without a Meeting
 
77
SECTION 13.12
Voting and Other Rights
 
78
 
ARTICLE XIV           MERGER, CONSOLIDATION OR CONVERSION
       
SECTION 14.1
Authority
 
78
SECTION 14.2
Procedure for Merger, Consolidation or Conversion
 
78
SECTION 14.3
Approval by Limited Partners of Merger, Consolidation or Conversion
 
80
SECTION 14.4
Certificate of Merger
 
81
SECTION 14.5
Effect of Merger, Consolidation or Conversion
 
81
 
ARTICLE XV           RIGHT TO ACQUIRE LIMITED PARTNER INTERESTS
       
SECTION 15.1
Right to Acquire Limited Partner Interests
 
82
 
ARTICLE XVI           GENERAL PROVISIONS
       
SECTION 16.1
Addresses and Notices; Written Communications
 
85
SECTION 16.2
Further Action
 
86
SECTION 16.3
Binding Effect
 
86
SECTION 16.4
Integration
 
86
SECTION 16.5
Creditors
 
86
SECTION 16.6
Waiver
 
86

 
 
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SECTION 16.7
Counterparts
 
86
SECTION 16.8
Third-Party Beneficiaries
 
86
SECTION 16.9
Applicable Law; Forum, Venue and Jurisdiction
 
86
SECTION 16.10
Invalidity of Provisions
 
87
SECTION 16.11
Consent of Partners
 
87
SECTION 16.12
Facsimile Signatures
 
87

 
 
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SECOND AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
CENTRAL ENERGY PARTNERS LP
 
THIS SECOND AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF CENTRAL
ENERGY PARTNERS LP (F/K/A Rio Vista Energy Partners L.P.), dated as of April 12,
2011, is entered into by and among Central Energy GP LLC, a Delaware limited
liability company, as the General Partner, together with any other Persons who
become Partners in the Partnership or parties hereto as provided herein. In
consideration of the covenants, conditions and agreements contained herein, the
parties hereto hereby agree as follows:
 
ARTICLE I
 
DEFINITIONS
 
SECTION 1.1     Definitions. The following definitions shall be for all
purposes, unless otherwise clearly indicated to the contrary, applied to the
terms used in this Agreement.
 
“Acquisition” means any transaction in which any Group Member acquires (through
an asset acquisition, merger, stock acquisition or other form of investment)
control over all or a portion of the assets, properties or business of another
Person for the purpose of increasing or expanding, for the long-term the asset
base of the Partnership Group from the operating capacity or operating income of
the Partnership Group existing immediately prior to such transaction.
 
“Additional Book Basis” means the portion of any remaining Carrying Value of an
Adjusted Property that is attributable to positive adjustments made to such
Carrying Value as a result of Book-Up Events. For purposes of determining the
extent that Carrying Value constitutes Additional Book Basis:
 
 
(a)
Any negative adjustment made to the Carrying Value of an Adjusted Property as a
result of either a Book-Down Event or a Book-Up Event shall first be deemed to
offset or decrease that portion of the Carrying Value of such Adjusted Property
that is attributable to any prior positive adjustments made thereto pursuant to
a Book-Up Event or Book-Down Event.

 
 
(b)
If Carrying Value that constitutes Additional Book Basis is reduced as a result
of a Book-Down Event and the Carrying Value of other property is increased as a
result of such Book-Down Event, an allocable portion of any such increase in
Carrying Value shall be treated as Additional Book Basis; provided, that the
amount treated as Additional Book Basis pursuant hereto as a result of such
Book-Down Event shall not exceed the amount by which the Aggregate Remaining Net
Positive Adjustments after such Book-Down Event exceeds the remaining Additional
Book Basis attributable to all of the Partnership’s Adjusted Property after such
Book-Down Event (determined without regard to the application of this clause (b)
to such Book-Down Event).

 
“Additional Book Basis Derivative Items” means any Book Basis Derivative Items
that are computed with reference to Additional Book Basis. To the extent that
the Additional Book Basis attributable to all of the Partnership’s Adjusted
Property as of the beginning of any taxable period exceeds the Aggregate
Remaining Net Positive Adjustments as of the beginning of such period (the
“Excess Additional Book Basis”), the Additional Book Basis Derivative Items for
such period shall be reduced by the amount that bears the same ratio to the
amount of Additional Book Basis Derivative Items determined without regard to
this sentence as the Excess Additional Book Basis bears to the Additional Book
Basis as of the beginning of such period. With respect to a Disposed of Adjusted
Property, the Additional Book Basis Derivative items abate to the discount of
Additional Book Basis taken into account for computing gain or loss from the
disposition of such Disposed Adjusted Property.
 
 
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“Adjusted Capital Account” means the Capital Account maintained for each Partner
as of the end of each taxable period of the Partnership, (a) increased by any
amounts that such Partner is obligated to restore under the standards set by
Treasury Regulation Section 1.704-1(b)(2)(ii)(c) (or is deemed obligated to
restore under Treasury Regulation Sections 1.704-2(g) and 1.704-2(i)(5)) and (b)
decreased by (i) the amount of all losses and deductions that, as of the end of
such taxable period, are reasonably expected to be allocated to such Partner in
subsequent years under Code Sections 704(e)(2) and 706(d) and Treasury
Regulation Section 1.751-1(b)(2)(ii), and (ii) the amount of all distributions
that, as of the end of such taxable period, are reasonably expected to be made
to such Partner in subsequent taxable period in accordance with the terms of
this Agreement or otherwise to the extent they exceed offsetting increases to
such Partner’s Capital Account that are reasonably expected to occur during (or
prior to) the taxable period in which such distributions are reasonably expected
to be made (other than increases as a result of a minimum gain chargeback
pursuant to Section 6.1(d)(i) or 6.1(d)(ii)). The foregoing definition of
Adjusted Capital Account is intended to comply with the provisions of Treasury
Regulation Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently
therewith. The “Adjusted Capital Account” of a Partner in respect of any
Partnership Interest shall be the amount which such Adjusted Capital Account
would be if such Partnership Interest were the only interest in the Partnership
held by such Partner from and after the date on which such Partnership Interest
was first issued.
 
“Adjusted Operating Surplus” means, with respect to any taxable period:
(a) Operating Surplus generated with respect to such taxable period; (b) less
(i) any net increase in Working Capital Borrowings (or the Partnership’s
proportionate share of any net increase in Working Capital Borrowings in the
case of Subsidiaries that are not wholly-owned by the Partnership) with respect
to such period and (ii) the amount of any net decrease in cash reserves (or the
Partnership’s proportionate share of any net decrease in cash reserves in the
case of Subsidiaries that are not wholly-owned by the Partnership) for Operating
Expenditures with respect to such period not relating to an Operating
Expenditure made during such period; and (c) plus (i) the amount of any net
decrease in Working Capital Borrowings (or the Partnership’s proportionate share
of any net decrease in Working Capital Borrowings in the case of Subsidiaries
that are not wholly-owned by the Partnership) with respect to such period,
(ii) the amount of any net increase in cash reserves (or the Partnership’s
proportionate share of any net increase in cash reserves in the case of
Subsidiaries that are not wholly-owned by the Partnership) for Operating
Expenditures with respect to such period required by any debt instrument for the
repayment of principal, interest or premiums and (iii) any net decrease made in
subsequent taxable periods in cash reserves for Operating Expenditures initially
established with respect to such taxable period to the extent such decrease
results in a reduction in Adjusted Operating Surplus in subsequent taxable
periods pursuant to clause (b)(ii) above.
 
“Adjusted Property” means any property the Carrying Value of which has been
adjusted pursuant to Section 5.4(d)(i) or 5.4(d)(ii).
 
“Affiliate” means, with respect to any Person, any other Person that directly or
indirectly through one or more intermediaries controls, is controlled by or is
under common control with, the Person in question. As used herein, the term
“control” 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
ownership of voting securities, by contract or otherwise.
 
“Aggregate Quantity of IDR Reset Common Units” has the meaning set forth in
Section 5.9(a).
 
 
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“Aggregate Remaining Net Positive Adjustments” means, as of the end of any
taxable period, the sum of the Remaining Net Positive Adjustments of all the
Partners.
 
“Agreed Allocation” means any allocation, other than a Required Allocation, of
an item of income, gain, loss or deduction pursuant to the provisions of
Section 6.1, including, without limitation, a Curative Allocation (if
appropriate to the context in which the term “Agreed Allocation” is used).
 
“Agreed Value of any Contributed Property” means the fair market value of such
property at the time of contribution and in the case of an Adjusted Property,
the fair market value of such Adjusted Property on the date of the revaluation
event as described in Section 5.4(d), in both cases as determined by the General
Partner. In making such determination, the General Partner shall use such method
as it determines to be appropriate.
 
“Agreement” means this Second Amended and Restated Agreement of Limited
Partnership of Central Energy Partners LP, as it may be amended, supplemented or
restated from time to time.
 
“Assignee” means an Eligible Holder or a Person to whom one or more Limited
Partner Interests have been transferred in a manner permitted under this
Agreement and who has executed and delivered a Transfer Application as required
by this Agreement, but who has not been admitted as a Substituted Limited
Partner.
 
“Associate” means, when used to indicate a relationship with any Person, (a) any
corporation or organization of which such Person is a director, officer,
manager, general partner or managing member or is, directly or indirectly, the
owner of 20% or more of any class of voting stock or other voting interest; (b)
any trust or other estate in which such Person has at least a 20% beneficial
interest or as to which such Person serves as trustee or in a similar fiduciary
capacity; and (c) any relative, whether by marriage or otherwise, or spouse of
such Person, or any relative of such spouse, who has the same principal
residence as such Person.
 
“Available Cash” means, with respect to any Quarter ending prior to the
Liquidation Date:
 
 
(a)
the sum of (i) all cash and cash equivalents of the Partnership Group (or the
Partnership’s proportionate share of cash and cash equivalents in the case of
Subsidiaries that are not wholly-owned by the Partnership) on hand at the end of
such Quarter, and (ii) if the General Partner so determines all or any portion
of any additional cash and cash equivalents of the Partnership Group (or the
Partnership’s proportionate share of cash and cash equivalents in the case of
Subsidiaries that are not wholly-owned by the Partnership) on hand on the date
of determination of Available Cash with respect to such Quarter resulting from
Working Capital Borrowings made subsequent to the end of such Quarter, less

 
 
(b)
the amount of any cash reserves established by the General Partner (or the
Partnership’s proportionate share of cash reserves in the case of Subsidiaries
that are not wholly-owned by the Partnership) to (i) provide for the proper
conduct of the business of the Partnership Group (including reserves for future
capital expenditures and for anticipated future credit needs of the Partnership
Group) subsequent to such Quarter, (ii) comply with applicable law or any loan
agreement, security agreement, mortgage, debt instrument or other agreement or
obligation to which any Group Member is a party or by which it is bound or its
assets are subject or (iii) provide funds for distributions under Section 6.4
or 6.5 in respect of any one or more of the next four Quarters;

 
 
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provided, however, that the General Partner may not establish cash reserves
pursuant to (b) above if the effect of such reserves would be that the
Partnership is unable to distribute the Minimum Quarterly Distribution on all
Common Units, plus any Cumulative Common Unit Arrearage on all Common Units,
with respect to such Quarter; and, provided further, that disbursements made by
a Group Member or cash reserves established, increased or reduced after the end
of such Quarter but on or before the date of determination of Available Cash
with respect to such Quarter shall be deemed to have been made, established,
increased or reduced, for purposes of determining Available Cash, within such
Quarter if the General Partner so determines.
 
Notwithstanding the foregoing, “Available Cash” with respect to the Quarter in
which the Liquidation Date occurs and any subsequent Quarter shall equal zero.
 
“Board of Directors” means, with respect to the Board of Directors of the
General Partner, its board of directors if a corporation or limited liability
company, or, if a limited partnership, the board of directors or board of
managers of the general partner of the General Partner.
 
“Book Basis Derivative Items” means any item of income, deduction, gain or loss
that is computed with reference to the Carrying Value of an Adjusted Property
(e.g., depreciation, depletion, or gain or loss with respect to an Adjusted
Property).
 
“Book-Down Event” means an event which triggers a negative adjustment to the
Capital Accounts of the Partners pursuant to Section 5.4(d).
 
“Book-Tax Disparity” means with respect to any item of Contributed Property or
Adjusted Property, as of the date of any determination, the difference between
the Carrying Value of such Contributed Property or Adjusted Property and the
adjusted basis thereof for federal income tax purposes as of such date. A
Partner’s share of the Partnership’s Book-Tax Disparities in all of its
Contributed Property and Adjusted Property will be reflected by the difference
between such Partner’s Capital Account balance as maintained pursuant to
Section 5.4 and the hypothetical balance of such Partner’s Capital Account
computed as if it had been maintained strictly in accordance with federal income
tax accounting principles.
 
“Book-Up Event” means an event which triggers a positive adjustment to the
Capital Accounts of the Partners pursuant to Section 5.4(d).
 
“Business Day” means Monday through Friday of each week, except that a legal
holiday recognized as such by the government of the United States of America or
the States of New York or Texas shall not be regarded as a Business Day.
 
“Capital Account” means the capital account maintained for a Partner pursuant to
Section 5.4. The “Capital Account” of a Partner in respect of any Partnership
Interest shall be the amount which such Capital Account would be if such
Partnership Interest were the only interest in the Partnership held by such
Partner from and after the date on which such Partnership Interest was first
issued.
 
“Capital Contribution” means any cash, cash equivalents or the Net Agreed Value
of Contributed Property that a Partner contributes to the Partnership or that is
contributed or deemed contributed to the Partnership on behalf of a Partner.
 
 
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“Capital Improvement” means any (a) addition or improvement to the capital
assets owned by any Group Member, (b) acquisition of existing, or the
construction of new or the improvement or replacement of existing capital
assets, or (c) capital contribution by a Group Member to a Person that is not a
Subsidiary in which a Group Member has an equity interest, or after such capital
contribution will have an equity interest, to fund such Group Member’s pro rata
share of the cost of the addition or improvement to or the acquisition of
existing, or the construction of new or the improvement or replacement of
existing, capital assets by such Person, in each case if such addition,
improvement, replacement, acquisition or construction is made to increase for
the long-term the asset base of the Partnership Group, in the case of clauses
(a) and (b), or such Person, in the case of clause (c), from the long-term asset
base of the Partnership Group existing immediately prior to such addition,
improvement, replacement, acquisition or construction.
 
“Capital Surplus” has the meaning assigned to such term in Section 6.3(a).
 
“Carrying Value” means (a) with respect to a Contributed Property, or Adjusted
Property, the Agreed Value of such property reduced (but not below zero) by all
depreciation, Simulated Depletion, amortization and cost recovery deductions
charged to the Partners’ and Assignees’ Capital Accounts in respect of such
Contributed Property, or Adjusted Property, and (b) with respect to any other
Partnership property, the adjusted basis of such property for federal income tax
purposes, all as of the time of determination. The Carrying Value of any
property shall be adjusted from time to time in accordance with
Sections 5.4(d)(i) and 5.4(d)(ii) and to reflect changes, additions or other
adjustments to the Carrying Value for dispositions and acquisitions of
Partnership properties, as deemed appropriate by the General Partner.
 
“Cause” means a court of competent jurisdiction has entered a final,
non-appealable judgment finding the General Partner liable for actual fraud,
gross negligence or willful or wanton misconduct in its capacity as a general
partner of the Partnership.
 
“Certificate” means (a) a certificate (i) substantially in the form of Exhibit A
to this Agreement, (ii) issued in global form in accordance with the rules and
regulations of the Depositary or (iii) in such other form as may be adopted by
the General Partner, issued by the Partnership evidencing ownership of one or
more Common Units or (b) a certificate, in such form as may be adopted by the
General Partner, issued by the Partnership evidencing ownership of one or more
other Partnership Interests.
 
“Certificate of Limited Partnership” means the Certificate of Limited
Partnership of the Partnership filed with the Secretary of State of the State of
Delaware as such Certificate of Limited Partnership may be amended, supplemented
or restated from time to time.
 
“Closing Date” means the date of Distribution.
 
“Closing Price” means, in respect of any class of Limited Partner Interests, as
of the date of determination, the last sale price on such day, regular way, or
in case no such sale takes place on such day, the average of the closing bid and
asked prices on such day, regular way, in either case as reported in the
principal consolidated transaction reporting system with respect to securities
listed or admitted for trading on the principal National Securities Exchange on
which such Limited Partner Interests of such class are listed or admitted to
trading or, if such Limited Partner Interests of such class are not listed or
admitted to trading on any National Securities Exchange, the last quoted price
on such day or, if not so quoted, the average of the high bid and low asked
prices on such day in the over-the-counter market, as reported by the primary
reporting system then in use in relation to such Limited Partner Interests of
such class, or, if on any such day such Limited Partner Interests of such class
are not quoted by any such organization, the average of the closing bid and
asked prices on such day as furnished by a professional market maker making a
market in such Limited Partner Interests of such class selected by the General
Partner, or if on any such day no market maker is making a market in such
Limited Partner Interests of such class, the fair value of such Limited Partner
Interests on such day as determined by the General Partner.
 
 
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“Code” means the Internal Revenue Code of 1986, as amended and in effect from
time to time. Any reference herein to a specific section or sections of the Code
shall be deemed to include a reference to any corresponding provision of any
successor law.
 
“Combined Interest” has the meaning assigned to such term in Section 11.3(a).
 
“Common Unit” means a Partnership Interest representing a fractional part of the
Partnership Interests of all Limited Partners and Assignees, and having the
rights and obligations specified with respect to Common Units in this Agreement.
 
“Common Unit Arrearage” means, with respect to any Common Unit, whenever issued,
commencing with the Quarter beginning October 1, 2011, the excess, if any, of
(a) the Minimum Quarterly Distribution with respect to a Common Unit in respect
of such Quarter over (b) the sum of all Available Cash distributed with respect
to a Common Unit in respect of such Quarter pursuant to Section 6.4(a).
 
“Conflicts Committee” means a committee of the Board of Directors of the General
Partner composed entirely of three or more directors, two (2) of whom (a) are
not officers or employees of the General Partner, (b) are not officers,
directors or employees of any Affiliate of the General Partner and (c) meet the
independence standards required of a director who serves on an audit committee
of a board of directors established in compliance with the provisions of the
Securities Exchange Act and the rules and regulations of the SEC and by the
National Securities Exchange on which any class of Partnership Interests is
listed or admitted to trading.
 
“Contributed Property” means each property or other asset, in such form as may
be permitted by the Delaware Act, but excluding cash, contributed to the
Partnership. Once the Carrying Value of a Contributed Property is adjusted
pursuant to Section 5.4(d), such property shall no longer constitute a
Contributed Property, but shall be deemed an Adjusted Property. For purposes of
this definition, each Limited Partner who receives Initial Common Units in the
Distribution shall be treated as having received a distribution of an undivided
interest in the assets contributed pursuant to the Contribution Agreement by
Penn Octane Corporation to the Partnership, subject to applicable liabilities
described in the Contribution Agreement, followed immediately thereafter by a
contribution of the Partner’s undivided interest in such assets subject to
applicable liabilities, to the Partnership in exchange for the Partner’s Initial
Common Units received in the Distribution. For this purpose, each Limited
Partner’s undivided interest in the assets expressed as a percentage shall be
the same percentage as the Limited Partner’s Percentage Interest determined
immediately following the Distribution.
 
“Contribution Agreement” means that certain Contribution, Conveyance and
Assumption Agreement, dated as of September 16, 2004, among the General Partner,
the Partnership, the Operating Partnership, Penn Octane Corporation and certain
other Affiliates of Penn Octane Corporation, together with the additional
conveyance documents and instruments contemplated or referenced thereunder.
 
“Cumulative Common Unit Arrearage” means, with respect to any Common Unit,
whenever issued, and as of the end of any Quarter commencing with the Quarter
ending March 31, 2012, the excess, if any, of (a) the sum resulting from adding
together the Common Unit Arrearage as to such Common Unit for each Quarter
ending on or before the last day of such Quarter over (b) the sum of any
distributions theretofore made pursuant to Section 6.4(b) and the second
sentence of Section 6.5 with respect to such Common Unit (including any
distributions to be made in respect of the last of such Quarters).
 
“Curative Allocation” means any allocation of an item of income, gain,
deduction, loss or credit pursuant to the provisions of Section 6.1(d)(xi).
 
 
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“Current Market Price” means, in respect of any class of Limited Partner
Interests, the date of determination, as of the average of the daily Closing
Prices per Limited Partner Interest of such class for the 20 consecutive Trading
Days immediately prior to such date.
 
“Delaware Act” means the Delaware Revised Uniform Limited Partnership Act, 6
Del. C. Section 17-101, et seq., as amended, supplemented or restated from time
to time, and any successor to such statute.
 
“Departing General Partner” means a former General Partner from and after the
effective date of any withdrawal or removal of such former General Partner
pursuant to Section 11.1 or 11.2.
 
“Depositary” means, with respect to any Units issued in global form,
Computershare Trust Company N.A. and its successors and permitted assigns.
 
“Disposed of Adjusted Property” shall have the meaning set forth in
Section 6.1(d)(xii)(B).
 
“Distribution” means the pro rata distribution by Penn Octane Corporation of its
98% Limited Partner Interest representing 98% of the Common Units to the
stockholders of Penn Octane Corporation, as described in the Registration
Statement.
 
“Economic Risk of Loss” has the meaning set forth in Treasury Regulation Section
1.752-2(a).
 
“Eligibility Certificate” has the meaning assigned to such in Section 4.9(b).
 
“Eligible Holder” means a Limited Partner whose (a) federal income tax status
would not, in the determination of the General Partner, have the material
adverse effect described in Section 4.9(a)(i) or (b) nationality, citizenship or
other related status would not, in the determination of the General Partner,
create a substantial risk of cancellation or forfeiture as described in
Section 4.9(a)(ii).
 
“Event of Withdrawal” has the meaning assigned to such term in Section 11.1(a).
 
“First Liquidation Target Amount” has the meaning assigned to such term in
Section 6.1(c)(i)(C).
 
“First Target Distribution” means $0.292 per Unit per Quarter (or, with respect
to periods of less than a full fiscal quarter, it means the product of such
amount multiplied by a fraction of which the numerator is the number of days in
such period, and the denominator is the total number of days in such quarter),
subject to adjustment in accordance with Sections 6.6 and 6.8.
 
“Fully Diluted Weighted Average Basis” means, when calculating the number of
Outstanding Units for any period, a basis that includes (i) the weighted average
number of Outstanding Units, all Partnership Interests and options, rights,
warrants, phantom units and appreciation rights relating to an equity interest
in the Partnership (a) that are convertible into or exercisable or exchangeable
for Units or for which Units are issuable in each case with the Common Units,
(b) whose conversion, exercise or exchange price is less than the Current Market
Price on the date of such calculation, (c) that may be converted into or
exercised or exchanged for such Units prior to or during the Quarter immediately
following the end of the period for which the calculation is being made without
the satisfaction of any contingency beyond the control of the holder other than
the payment of consideration and the compliance with administrative mechanics
applicable to such conversion, exercise or exchange, and (d) were not converted
into or exercised or exchanged for such Units during the period for which the
calculation is being made.
 
 
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“General Partner” means Central Energy GP LLC and its successors and permitted
assigns that are admitted to the Partnership as general partner of the
Partnership.
 
“General Partner Interest” means the ownership interest of the General Partner
in the Partnership (in its capacity as a general partner without reference to
any Limited Partner Interest held by it) and includes any and all benefits to
which the General Partner is entitled as provided in this Agreement, together
with all obligations of the General Partner to comply with the terms and
provisions of this Agreement.
 
“Gross Liability Value” means, with respect to any Liability of the Partnership
described in Treasury Regulations Section 1.752-7(b)(3)(i), the amount of cash
that a willing assignor would pay to a willing assignee to assume such Liability
in an arm’s-length transaction.
 
“Group” means a Person that with or through any of its Affiliates or Associates
has any agreement, arrangement or understanding for the purpose of acquiring,
holding, voting (except voting pursuant to a revocable proxy or consent given to
such Person in response to a proxy or consent solicitation made to 10 or more
Persons), exercising investment power or disposing of any Partnership Interests
with any other Person that beneficially owns, or whose Affiliates or Associates
beneficially own, directly or indirectly, Partnership Interests.
 
“Group Member” means a member of the Partnership Group.
 
“Group Member Agreement” means the partnership agreement of any Group Member,
other than the Partnership, that is a limited or general partnership, the
limited liability company agreement of any Group Member that is a limited
liability company, the certificate of incorporation and bylaws or similar
organizational documents of any Group Member that is a corporation, the joint
venture agreement or similar governing document of any Group Member that is a
joint venture and the governing or organizational or similar documents of any
other Group Member that is a Person other than a limited or general partnership,
limited liability company, corporation or joint venture, as such may be amended,
supplemented or restated from time to time.
 
“Holder” has the meaning assigned to such term in Section 15.1(b)(ii).
 
“IDR Reset Common Unit” has the meaning assigned to such term in Section 5.9(a).
 
“IDR Reset Election” has the meaning assigned to such term in Section 5.9(a).
 
“Incentive Distribution Right” means a non-voting Limited Partner Interest which
confers upon the holder thereof only the rights and obligations specifically
provided in this Agreement with respect to Incentive Distribution Rights (and no
other rights otherwise available to or other obligations of a holder of a
Partnership Interest). Notwithstanding anything in this Agreement to the
contrary, the holder of an Incentive Distribution Right shall not be entitled to
vote such Incentive Distribution Right on any Partnership matter except as may
otherwise be required by law.
 
“Incentive Distributions” means any amount of cash distributed to the holders of
the Incentive Distribution Rights pursuant to Section 6.4.
 
 
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“Indemnitee” means (a) any General Partner, (b) any Departing General Partner,
(c) any Person who is or was an Affiliate of the General Partner or any
Departing General Partner, (d) any Person who is or was a managing member,
partner, officer, director, employee, manager, agent, fiduciary or trustee of
any Group Member, a General Partner, any Departing General Partner or any of
their respective Affiliates, (e) any Person who is or was serving at the request
of a General Partner, any Departing General Partner or any of their respective
Affiliates as an officer, director, employee, managing member, manager, partner,
agent, fiduciary or trustee of another Person owing a fiduciary duty to any
Group Member; provided, that a Person shall not be an Indemnitee by reason of
providing, on a fee-for-services basis, trustee, fiduciary or custodial
services, (f) any Person who controls a General Partner or Departing General
Partner and (g) any Person the General Partner designates as an “Indemnitee” for
purposes of this Agreement because such Person’s service, status or relationship
exposes such Person to potential claims, demands, actions, suits or proceedings
relating to the Partnership Group’s business and affairs.
 
“Ineligible Holder” has the meaning set forth in Section 4.9(b).
 
“Initial Common Units” means the Common Units distributed in the Distribution.
 
“Initial Limited Partners” means the General Partner and the stockholders of
Penn Octane Corporation that received Initial Common Units in the Distribution,
in each case upon being admitted to the Partnership in accordance with
Section 10.1.
 
“Initial Unit Capital Account” means (a) with respect to each Initial Limited
Partner, the value assigned for federal income tax purposes by the General
Partner (in its reasonable discretion) to the Contributed Property contributed
by an Initial Limited Partner to the Partnership (as described in the definition
of Contributed Property) in exchange for the Initial Common Units, reduced by
the amount of liabilities to which such property is subject as determined by the
General Partner in its reasonable discretion or (b) with respect to any other
class or series of Units, the price per Unit at which such class or series of
Units is initially sold by the Partnership, as determined by the General
Partner, in each case adjusted as the General Partner determines to be
appropriate to give effect to any distribution, subdivision or combination of
Units.
 
“Interim Capital Transactions” means the following transactions if they occur
prior to the Liquidation Date: (a) borrowings, refinancings or refunding of
indebtedness (other than Working Capital Borrowings and other than for items
purchased on open account or for a deferred purchase price in the ordinary
course of business) by any Group Member and sales of debt securities by any
Group Member; (b) sales of equity interests by any Group Member; and (c) sales
or other voluntary or involuntary dispositions of any assets of any Group Member
other than (i) sales or other dispositions of inventory, accounts receivable and
other assets in the ordinary course of business, and (ii) sales or other
dispositions of assets as part of normal retirements or replacements.
 
“Issue Price” means the price at which a Unit is purchased from the Partnership,
after taking into account any sales commission or underwriting discount charged
to the Partnership.
 
“Liability” means any liability or obligation of any nature whatsoever, whether
accrued, contingent or otherwise.
 
“Limited Partner” means, unless the context otherwise requires, the
Organizational Limited Partner prior to the Distribution, each Limited Partner,
each Substituted Limited Partner and any Departing General Partner upon the
change of its status from General Partner to Limited Partner pursuant to
Section 11.3; provided, however, that when the term “Limited Partner” is used
herein in the context of any vote or other approval, including Articles XIII
and XIV, such term shall not, solely for such purpose, include any holder of an
Incentive Distribution Right (solely with respect to its Incentive Distribution
Rights and not with respect to any other Limited Partner Interest held by such
Person) except as may otherwise be required by law.
 
 
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“Limited Partner Interest” means the ownership interest of a Limited Partner or
Assignee in the Partnership, which may be evidenced by Common Units, Incentive
Distribution Rights or other Partnership Interests or a combination thereof or
interest therein, and includes any and all benefits to which such Limited
Partner or Assignee is entitled as provided in this Agreement, together with all
obligations of such Limited Partner or Assignee to comply with the terms and
provisions of this Agreement; provided, however, that when the term “Limited
Partner Interest” is used herein in the context of any vote or other approval,
including Articles XIII and XIV, such term shall not, solely for such purpose,
include any holder of an Incentive Distribution Right except as may otherwise be
required by law.
 
“Liquidation Date” means in the case of any event giving rise to the dissolution
of the Partnership, the date on which such event occurs.
 
“Liquidator” means one or more Persons selected by the General Partner to
perform the functions described in Section 12.4 as liquidating trustee of the
Partnership within the meaning of the Delaware Act.
 
“LTIP” means the Long-Term Incentive Plan of the General Partner, as may be
amended, or any equity compensation plan successor thereto.
 
“Merger Agreement” has the meaning set forth in Section 14.1.
 
“Minimum Quarterly Distribution” means $0.25 per Unit per Quarter (or with
respect to periods of less than a full quarter, it means the product of $0.25
multiplied by a fraction of which the numerator is the number of days in such
period and of which the denominator is the total number of days in that
Quarter), subject to adjustment in accordance with Sections 5.9, 6.6 and 6.8.
 
“National Securities Exchange” means an exchange registered with the SEC under
Section 6(a) of the Securities Exchange Act and any successor to such section,
or any other securities exchange (whether or not registered with the SEC) that
the General Partner shall designate as a “National Securities Exchange” for
purposes of this Agreement.
 
“Net Agreed Value” means, (a) in the case of any Contributed Property, the
Agreed Value of such property reduced by any Liability either assumed by the
Partnership upon such contribution or to which such property is subject when
contributed, and (b) in the case of any property distributed to a Partner or
Assignee by the Partnership, the Partnership’s Carrying Value of such property
(as adjusted pursuant to Section 5.4(d)(ii)) at the time such property is
distributed, reduced by any Liability either assumed by such Partner or Assignee
upon such distribution or to which such property is subject at the time of
distribution, in either case, as determined under Code Section 752.
 
“Net Income” means, for any taxable period, the excess, if any, of the
Partnership’s items of income and gain (other than those items taken into
account in the computation of Net Termination Gain or Net Termination Loss) for
such taxable period over the Partnership’s items of loss and deduction (other
than those items taken into account in the computation of Net Termination Gain
or Net Termination Loss) for such taxable period. The items included in the
calculation of Net Income shall be determined in accordance with Section 5.4(b)
and shall include Simulated Gain but shall not include any items specially
allocated under Section 6.1(d) or Section 6.1(e); provided, that the
determination of the items that have been specially allocated under
Section 6.1(d) or Section 6.1(e) without regard to any reversal of such items
under Section 6.1(d)(xi).
 
 
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“Net Loss” means, for any taxable period, the excess, if any, of the
Partnership’s items of loss and deduction (other than those items taken into
account in the computation of Net Termination Gain or Net Termination Loss) for
such taxable period over the Partnership’s items of income and gain (other than
those items taken into account in the computation of Net Termination Gain or Net
Termination Loss) for such taxable period. The items included in the calculation
of Net Loss shall be determined in accordance with Section 5.4(b) and shall
include Simulated Gain but shall not include any items specially allocated under
Section 6.1(d) or Section 6.1(e); provided, that the determination of the items
that have been specially allocated under Section 6.1(d) or Section 6.1(e) shall
be made without regard to any reversal of such items under Section 6.1(d)(xi).
 
“Net Positive Adjustments” means, with respect to any Partner, the excess, if
any, of the total positive adjustments over the total negative adjustments made
to the Capital Account of such Partner pursuant to Book-Up Events and Book-Down
Events.
 
“Net Termination Gain” means, for any taxable period, the sum, if positive, of
all items of income, gain, loss or deduction (determined in accordance with
Section 5.4(b)) that are (a) recognized after the Liquidation Date or (b) deemed
recognized by the Partnership pursuant to Section 5.4(d); provided, however,
items included in the determination of Net Termination Gain shall include
Simulated Gain but shall not include any items of income, gain or loss specially
allocated under Section 6.1(d) or Section 6.1(e).
 
“Net Termination Loss” means, for any taxable period, the sum, if negative, of
all items of income, gain, loss or deduction (determined in accordance with
Section 5.4(b)) that are (a) recognized after the Liquidation Date or (b) deemed
recognized by the Partnership pursuant to Section 5.4(d); provided, however,
items included in the determination of Net Termination Loss shall include
Simulated Gain but shall not include any items of income, gain or loss specially
allocated under Section 6.1(d) or Section 6.1(e).
 
“Nonrecourse Built-in Gain” means with respect to any Contributed Properties or
Adjusted Properties that are subject to a mortgage or pledge securing a
Nonrecourse Liability, the amount of any taxable gain that would be allocated to
the Partners pursuant to Section 6.2 if such properties were disposed of in a
taxable transaction in full satisfaction of such liabilities and for no other
consideration.
 
“Nonrecourse Deductions” means any and all items of loss, deduction, expenditure
(including, without limitation, any expenditure described in Code Section
705(a)(2)(B)), Simulated Depletion or Simulated Loss that, in accordance with
the principles of Treasury Regulation Section 1.704-2(b), are attributable to a
Nonrecourse Liability.
 
“Nonrecourse Liability” has the meaning set forth in Treasury Regulation Section
1.752-1(a)(2).
 
“Notice of Election to Purchase” has the meaning assigned to such term in
Section 15.1(b)(i).
 
“Operating Expenditures” means all Partnership Group cash expenditures (or the
Partnership’s proportionate share of expenditures in the case of Subsidiaries
that are not wholly-owned), including, but not limited to, taxes, reimbursements
of expenses of the General Partner and its Affiliates, payments made in the
ordinary course of business, officer compensation, repayment of Working Capital
Borrowings, debt service payments and expenditures for Capital Improvements,
subject to the following:
 
 
(a)
payments (including prepayments and prepayment penalties) of principal of and
premium on indebtedness other than Working Capital Borrowings shall not
constitute Operating Expenditures; and

 
 
(b)
Operating Expenditures shall not include (i) Capital Improvements, (ii) payment
of transaction expenses (including taxes) relating to Interim Capital
Transactions or (iii) distributions to Partners. Where capital expenditures are
made in part for Acquisitions or for Capital Improvements and in part for other
purposes, the General Partner’s good faith allocation between the amounts paid
for each shall be conclusive.

 
 
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“Operating Partnership” means Rio Vista Operating Partnership L.P., a Delaware
limited partnership, and any successors thereto.
 
“Operating Partnership Agreement” means the partnership agreement of the
Operating Partnership, as it may be amended, supplemented or restated from time
to time.
 
“Operating Surplus” means, with respect to any period ending prior to the
Liquidation Date, on a cumulative basis and without duplication,
 
 
(a)
the sum of (i) all cash and cash equivalents of the Partnership Group on hand as
of the close of business on the Closing Date, (ii) all cash receipts of the
Partnership Group (or the Partnership’s proportionate share of cash receipts in
the case of Subsidiaries that are not wholly owned) for the period beginning on
the Closing Date and ending with the last day of such period, but excluding cash
receipts from Interim Capital Transactions (except to the extent specified in
Section 6.5) and, (iii) all cash receipts of the Partnership Group (or the
Partnership’s proportionate share of cash receipts in the case of Subsidiaries
that are not wholly-owned) after the end of such period but on or before the
date of determination of Operating Surplus with respect to such period resulting
from Working Capital Borrowings, less

 
 
(b)
the sum of (i) Operating Expenditures for the period beginning on the Closing
Date and ending on the last day of such period; (ii) the amount of cash reserves
established by the General Partner (or the Partnership’s proportionate share of
cash reserves in the case of Subsidiaries that are not wholly-owned) to provide
funds for future Operating Expenditures;

 
provided, however, that disbursements made (including contributions to a Group
Member or disbursements on behalf of a Group Member) or cash reserves
established, increased or reduced after the end of such period but on or before
the date of determination of Available Cash with respect to such period shall be
deemed to have been made, established, increased or reduced, for purposes of
determining Operating Surplus, within such period if the General Partner so
determines.
 
Notwithstanding the foregoing, “Operating Surplus” with respect to the Quarter
in which the Liquidation Date occurs and any subsequent Quarter shall equal
zero.
 
“Opinion of Counsel” means a written opinion of counsel (who may be regular
counsel to the Partnership or the General Partner or any of its Affiliates)
acceptable to the General Partner.
 
“Organizational Limited Partner” means Penn Octane Corporation in its capacity
as the organizational limited partner of the Partnership pursuant to this
Agreement.
 
“Outstanding” means, with respect to Partnership Interests, all Partnership
Interests that are issued by the Partnership and reflected as outstanding on the
Partnership’s books and records as of the date of determination; provided,
however, that if at any time any Person or Group (other than the General Partner
or its Affiliates) beneficially owns 20% or more of any Outstanding Partnership
Interests of any class then Outstanding, all Partnership Interests owned by such
Person or Group shall not be voted on any matter and shall not be considered to
be Outstanding when sending notices of a meeting of Limited Partners to vote on
any matter (unless otherwise required by law), calculating required votes,
determining the presence of a quorum or for other similar purposes under this
Agreement, except that Partnership Interests so owned shall be considered to be
Outstanding for purposes of Section 11.1(b)(iii) (such Partnership Interests
shall not, however, be treated as a separate class of Partnership Interests for
purposes of this Agreement or the Delaware Act); provided, further, that the
foregoing limitation shall not apply (i) to any Person or Group who acquired 20%
or more of any Outstanding Partnership Interests of any class then Outstanding
directly from the General Partner or its Affiliates (other than the
Partnership), (ii) to any Person or Group who acquired 20% or more of any
Outstanding Partnership Interests of any class then Outstanding directly or
indirectly from a Person or Group described in clause (i) provided, that the
General Partner shall have notified such Person or Group in writing that such
limitation shall not apply, or (iii) to any Person or Group who acquired 20% or
more of any Partnership Interests issued by the Partnership with the prior
approval of the Board of Directors of the General Partner; provided further,
that the provisions contained herein may be amended by the General Partner as
provided in Section 13.1.
 
 
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“Partner Nonrecourse Debt” has the meaning set forth in Treasury Regulation
Section 1.704-2(b)(4).
 
“Partner Nonrecourse Debt Minimum Gain” has the meaning set forth in Treasury
Regulation Section 1.704-2(i)(2).
 
“Partner Nonrecourse Deductions” means any and all items of loss, deduction,
expenditure (including, without limitation, any expenditure described in Code
Section 705(a)(2)(B)), Simulated Depletion or Simulated Loss that, in accordance
with the principles of Treasury Regulation Section 1.704-2(i), are attributable
to a Partner Nonrecourse Debt.
 
“Partners” means the General Partner and the Limited Partners.
 
“Partnership” means Central Energy Partners LP, a Delaware limited partnership,
and any successors thereto.
 
“Partnership Group” means the Partnership and any Subsidiary of any such entity,
treated as a single consolidated entity.
 
“Partnership Interest” or “Partnership Interests” means any class or series of
equity interest in the Partnership (but excluding any options, rights, warrants
and appreciation rights relating to an equity interest in the Partnership),
including Common Units and Incentive Distribution Rights.
 
“Partnership Minimum Gain” means that amount determined in accordance with the
principles of Treasury Regulation Sections 1.704-2(b)(2) and 1.704-2(d).
 
“Percentage Interest” means as of any date of determination (a) as to the
General Partner (in its capacity as General Partner without reference to any
Limited Partner Interests held by it), 2.0%, (b) as to any Unitholder or
Assignee holding Units, the product obtained by multiplying (i) 98% less the
percentage applicable to paragraph (c) by (ii) the quotient obtained by dividing
(A) the number of Units held by such Unitholder or Assignee by (B) the total
number of all Outstanding Units, and (c) as to the holders of additional
Partnership Interests issued by the Partnership in accordance with Sections 5.5,
5.6 and 5.7, the percentage established as a part of such issuance. The
Percentage Interest with respect to an Incentive Distribution Right shall at all
times be zero.
 
“Per Unit Capital Amount” means, as of any date of determination, the Capital
Account, stated on a per Unit basis, underlying any Unit held by a Person other
than the General Partner or any Affiliate of the General Partner who holds
Units.
 
 
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“Person” means an individual or a corporation, limited liability company,
partnership, joint venture, trust, unincorporated organization, association,
government agency or political subdivision thereof or other entity.
 
“Plan of Conversion” has the meaning set forth in Section 14.1.
 
“Pro Rata” means (a) when used with respect to Units or any class thereof,
apportioned equally among all designated Units in accordance with their relative
Percentage Interests, (b) when used with respect to Partners, Record Holders and
Assignees, apportioned among all Partners, Record Holders and Assignees in
accordance with their relative Percentage Interests and (c) when used with
respect to holders of Incentive Distribution Rights, apportioned equally among
all holders of Incentive Distribution Rights in accordance with the relative
number of Incentive Distribution Rights held by each such holder.
 
“Purchase Date” means the date determined by the General Partner as the date for
purchase of all Outstanding Limited Partner Interests of a certain class (other
than Limited Partner Interests owned by the General Partner and its Affiliates)
pursuant to Article XV.
 
“Quarter” means, unless the context requires otherwise, a fiscal quarter, or,
with respect to the first fiscal quarter that includes the Closing Date, the
portion of such fiscal quarter after the Closing Date.
 
“Rate Eligible Trigger” has the meaning set forth in Section 4.9(a)(i).
 
“Recapture Income” means any gain recognized by the Partnership (computed
without regard to any adjustment required by Section 734 or Section 743 of the
Code) upon the disposition of any property or asset of the Partnership, which
gain is characterized as ordinary income because it represents the recapture of
deductions previously taken with respect to such property or asset.
 
“Record Date” means the date established by the General Partner or otherwise in
accordance with this Agreement for determining (a) the identity of the Record
Holders entitled to notice of, or to vote at, any meeting of Limited Partners or
entitled to vote by ballot or give approval of Partnership action in writing
without a meeting or entitled to exercise rights in respect of any lawful action
of Limited Partners or (b) the identity of Record Holders entitled to receive
any report or distribution or to participate in any offer.
 
“Record Holder” means (a) with respect to any class of Partnership Interest for
which a Transfer Agent has been appointed, the Person in whose name a
Partnership Interest of such class is registered on the books of the Transfer
Agent as of the opening of business on a particular Business Day, or (b) with
respect to other classes of Partnership Interests, the Person in whose name any
such other Partnership Interest is registered on the books that the General
Partner has caused to be kept as of the opening of business on such Business
Day.
 
“Redeemable Interests” means any Partnership Interests for which a redemption
notice has been given, and has not been withdrawn, pursuant to Section 4.10.
 
“Registration Statement” means the Registration Statement on Form 10 (File No.
0-50394) as it has been or as it may be amended or supplemented from time to
time, filed by the Partnership with the SEC under the Securities Act to register
the offering and sale of the Common Units distributed in the Distribution.
 
 
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“Remaining Net Positive Adjustments” means as of the end of any taxable period,
(i) with respect to the Unitholders holding Common Units, the excess of (a) the
Net Positive Adjustments of the Unitholders holding Common Units as of the end
of such period over (b) the sum of those Partners’ Share of Additional Book
Basis Derivative Items for each prior taxable period, (ii) with respect to the
General Partner (as holder of the General Partner Interest), the excess of (a)
the Net Positive Adjustments of the General Partner as of the end of such period
over (b) the sum of the General Partner’s Share of Additional Book Basis
Derivative Items with respect to the General Partner Interest for each prior
taxable period, and (iii) with respect to the holders of Incentive Distribution
Rights, the excess of (a) the Net Positive Adjustments of the holders of
Incentive Distribution Rights as of the end of such period over (b) the sum of
the Share of Additional Book Basis Derivative Items of the holders of the
Incentive Distribution Rights for each prior taxable period.
 
“Required Allocation” means (a) any limitation imposed on any allocation of Net
Losses or Net Termination Losses under Section 6.1(b) and (b) any allocation of
an item of income, gain, loss, deduction, Simulated Depletion or Simulated Loss
pursuant to Sections 6.1(d)(i), 6.1(d)(ii), 6.1(d)(iv), 6.1(d)(vii), 6.1(d)(ix)
or 6.1(d)(x).
 
“Reset MQD” has the meaning set forth in Section 5.9(a).
 
“Reset Notice” has the meaning set forth in Section 5.9(b).
 
“Residual Gain” or “Residual Loss” means any item of gain or loss, as the case
may be, of the Partnership recognized for federal income tax purposes resulting
from a sale, exchange or other disposition of a Contributed Property or Adjusted
Property, to the extent such item of gain or loss is not allocated pursuant to
Section 6.2(b)(i)(A) or 6.2(b)(ii)(A), respectively, to eliminate Book-Tax
Disparities.
 
“SEC” means the United States Securities and Exchange Commission.
 
“Second Liquidation Target Amount” has the meaning assigned to such term in
Section 6.1(c)(i)(D).
 
“Second Target Distribution” means $0.362 per Unit per Quarter (or, with respect
to periods of less than a full fiscal quarter, it means the product of such
amount multiplied by a fraction of which the numerator is the number of days in
such period, and the denominator is the total number of days in such quarter),
subject to adjustment in accordance with Sections 5.9, 6.6 and 6.8.
 
“Securities Act” means the Securities Act of 1933, as amended, supplemented or
restated from time to time and any successor to such statute.
 
“Securities Exchange Act” means the Securities Exchange Act of 1934, as amended,
supplemented and restated from time to time and any successor to such statute.
 
“Share of Additional Book Basis Derivative Items” means in connection with any
allocation of Additional Book Basis Derivative Items for any taxable period, (i)
with respect to the Unitholders holding Common Units, the amount that bears the
same ratio to such Additional Book Basis Derivative Items as the Unitholders’
Remaining Net Positive Adjustments as of the end of such taxable period bears to
the Aggregate Remaining Net Positive Adjustments as of that time, (ii) with
respect to the General Partner (in respect of the General Partner Interest), the
amount that bears the same ratio to such Additional Book Basis Derivative Items
as the General Partner’s Remaining Net Positive Adjustments as of the end of
such taxable period bears to the Aggregate Remaining Net Positive Adjustment as
of that time, and (iii) with respect to the Partners holding Incentive
Distribution Rights, the amount that bears the same ratio to such Additional
Book Basis Derivative Items as the Remaining Net Positive Adjustments of the
Partners holding the Incentive Distribution Rights as of the end of such taxable
period bears to the Aggregate Remaining Net Positive Adjustments as of that
time.
 
 
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“Simulated Basis” means the Carrying Value of any oil and gas property (as
defined in Code Section 614).
 
“Simulated Depletion” mean, with respect to an oil and gas property (as defined
in Code Section 614), a depletion allowance computed in accordance with federal
income tax principles (as if the Simulated Basis of the property was its
adjusted tax basis) and in the manner specified in Treasury Regulation Section
1.704-1(b)(2)(iv)(k)(2). For purposes of computing Simulated Depletion with
respect to any property, the Simulated Basis of such property shall be deemed to
be the Carrying Value of such property, and in no event shall such allowance for
Simulated Depletion, in the aggregate, exceed such Simulated Basis.
 
“Simulated Gain” means the excess, if any, of the amount realized from the sale
or other disposition of an oil or gas property (as defined in Code Section 614)
over the Carrying Value of such property.
 
“Simulated Loss” means the excess, if any, of the Carrying Value of an oil or
gas property (as defined in Code Section 614) over the amount realized from the
sale or other disposition of such property.
 
“Special Approval” means approval by a majority of the members of the Conflicts
Committee.
 
“Subsidiary” means, with respect to any Person, (a) a corporation of which more
than 50% of the voting power of shares entitled (without regard to the
occurrence of any contingency) to vote in the election of directors or other
governing body of such corporation is owned, directly or indirectly, at the date
of determination, by such Person, by one or more Subsidiaries of such Person or
a combination thereof, (b) a partnership (whether general or limited) in which
such Person or a Subsidiary of such Person is, at the date of determination, a
general or limited partner of such partnership, but only if more than 50% of the
partnership interests of such partnership (considering all of the partnership
interests of the partnership as a single class) is owned, directly or
indirectly, at the date of determination, by such Person, by one or more
Subsidiaries of such Person, or a combination thereof, or (c) any other Person
(other than a corporation or a partnership) in which such Person, one or more
Subsidiaries of such Person, or a combination thereof, directly or indirectly,
at the date of determination, has (i) at least a majority ownership interest or
(ii) the power to elect or direct the election of a majority of the directors or
other governing body of such Person.
 
“Substituted Limited Partner” means a Person who is admitted as a Limited
Partner to the Partnership pursuant to Section 10.2 in place of and with all the
rights of a Limited Partner and who is shown as a Limited Partner on the books
and records of the Partnership.
 
“Surviving Business Entity” has the meaning assigned to such term in
Section 14.2(b).
 
“Third Liquidation Target Amount” has the meaning assigned to such term in
Section 6.1(c)(i)(E).
 
“Third Target Distribution” means $0.462 per Unit per Quarter (or, with respect
to periods of less than a full fiscal quarter, it means the product of such
amount multiplied by a fraction of which the numerator is the number of days in
such period, and the denominator is the total number of days in such quarter)),
subject to adjustment in accordance with Sections 5.9, 6.6 and 6.8.
 
“Trading Day” means, for the purpose of determining the Current Market Price of
any class of Limited Partner Interests, a day on which the principal National
Securities Exchange on which such Limited Partner Interests is listed or
admitted to trading is open for the transaction of business or, if Limited
Partner Interests of a class are not listed or admitted to trading on any
National Securities Exchange, a day on which banking institutions in New York
City generally are open.
 
 
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“transfer” has the meaning assigned to such term in Section 4.4(a).
 
“Transfer Agent” means such bank, trust company or other Person (including the
General Partner or one of its Affiliates) as shall be appointed from time to
time by the Partnership to act as registrar and transfer agent for the Common
Units; provided, that if no Transfer Agent is specifically designated for any
class of Partnership Interests, the General Partner shall act in such capacity.
 
“Transfer Application” means an application and agreement for transfer of Units
in the form set forth on the back of a Certificate or in a form substantially to
the same effect in a separate instrument.
 
“Unit” means a Partnership Interest that is designated as a “Unit” and shall
include Common Units but shall not include (i) a General Partner Interest or
(ii) Incentive Distribution Rights.
 
“Unit Majority” means at least a majority of the Outstanding Common Units.
 
“Unitholders” means the holders of Units.
 
“Unpaid MQD” has the meaning assigned to such term in Section 6.1(c)(i)(B).
 
“Unrealized Gain” attributable to any item of Partnership property means, as of
any date of determination, the excess, if any, of (a) the fair market value of
such property as of such date (as determined under Section 5.4(d)) over (b) the
Carrying Value of such property as of such date (prior to any adjustment to be
made pursuant to Section 5.4(d) as of such date).
 
“Unrealized Loss” attributable to any item of Partnership property means, as of
any date of determination, the excess, if any, of (a) the Carrying Value of such
property as of such date (prior to any adjustment to be made pursuant to
Section 5.4(d) as of such date) over (b) the fair market value of such property
as of such date (as determined under Section 5.4(d)).
 
“Unrecovered Capital” means at any time, with respect to a Unit, the Initial
Unit Capital Account less the sum of all distributions constituting Capital
Surplus theretofore made in respect of an Initial Common Unit and any
distributions of cash (or the Net Agreed Value of any distributions in kind) in
connection with the dissolution and liquidation of the Partnership theretofore
made in respect of an Initial Common Unit, adjusted as the General Partner
determines to be appropriate to give effect to any distribution, subdivision or
combination of such Units.
 
“Unrestricted Person” means (a) each Indemnitee, (b) each Partner, (c) each
Person who is or was a member, partner, director, officer, employee or agent of
any Group Member, a General Partner or any Departing General Partner or any
Affiliate of any Group Member, a General Partner or any Departing General
Partner and (d) any Person the General Partner designates as an “Unrestricted
Person” for purposes of this Agreement.
 
“U.S. GAAP” means United States Generally Accepted Accounting Principles
consistently applied.
 
“Withdrawal Opinion of Counsel” has the meaning assigned to such term in
Section 11.1(b).
 
“Working Capital Borrowings” means borrowings used solely for working capital
purposes or to pay distributions to Partners made pursuant to a credit facility,
commercial paper facility or other similar financing arrangements.
 
 
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SECTION 1.2    Construction. Unless the context requires otherwise: (a) any
pronoun used in this Agreement shall include the corresponding masculine,
feminine or neuter forms, and the singular form of nouns, pronouns and verbs
shall include the plural and vice versa; (b) references to Articles and Sections
refer to Articles and Sections of this Agreement; (c) the term “include” or
“includes” means includes, without limitation, and “including” means including,
without limitation; and (d) the terms “hereof”, “herein” or “hereunder” refer to
this Agreement as a whole and not to any particular provision of this Agreement.
The headings contained in this Agreement are for reference purposes only, and
shall not affect in any way the meaning or interpretation of this Agreement.
 
ARTICLE II
 
ORGANIZATION
 
SECTION 2.1    Formation. The General Partner and the Organizational Limited
Partner have previously formed the Partnership as a limited partnership pursuant
to the provisions of the Delaware Act and amended and restated the original
Agreement of Limited Partnership of Rio Vista Energy Partners L.P. in its
entirety as of September 16, 2004. On October 26, 2005, and on December 28,
2010, the General Partner amended the Amended and Restated Agreement of Limited
Partnership of Rio Vista Energy Partners L.P. to (a) restate Section 12.1(d) of
the Agreement to clarify that the Partnership would be dissolved only after
distribution of proceeds to the Partners upon the sale of all or substantially
all of the Partnership’s assets and (b) to (i) change the name of the
Partnership to Central Energy Partners LP and (ii) to change the definitions of
“Common Unit Arrearage” and Cumulative Common Unit Arrearage” in order that the
Partnership would no longer be obligated to make any further distributions of
Common Unit Arrearages or Cumulative Common Unit Arrearages in respect of any
quarter prior to the quarter beginning October 1, 2011. The purpose of this
Second Amended and Restated Agreement of Limited Partnership is (A) to establish
the ability of the Partnership to reset Incentive Distribution Rights,
(B) incorporate changes made to the Code and Treasury Regulations since the
First Amended and Restated Agreement of Limited Partnership was adopted,
(C) provide for the issuance of uncertificated securities so that the
Partnership Interests can be eligible for a direct registration program,
(D) clarify certain provisions of the Agreement, and (E) make other
miscellaneous revisions. This amendment and restatement shall become effective
on the date of this Agreement and amends and restates in its entirety and
supersedes the Amended and Restated Agreement of Limited Partnership, as
amended, which shall have no further force and effect. Except as expressly
provided to the contrary in this Agreement, the rights, duties (including
fiduciary duties), liabilities and obligations of the Partners and the
administration, dissolution and termination of the Partnership shall be governed
by the Delaware Act. All Partnership Interests shall constitute personal
property of the owner thereof for all purposes and a Partner has no interest in
specific Partnership property.
 
SECTION 2.2     Name. The name of the Partnership shall be “Central Energy
Partners LP.” The Partnership’s business may be conducted under any other name
or names deemed necessary or appropriate by the General Partner including the
name of the General Partner. The words “Limited Partnership,” “L.P.,” “Ltd.” or
similar words or letters shall be included in the Partnership’s name where
necessary for the purpose of complying with the laws of any jurisdiction that so
requires. The General Partner in its discretion may change the name of the
Partnership at any time and from time to time and shall notify the Limited
Partners of such change in the next regular communication to the Limited
Partners.
 
SECTION 2.3     Registered Office; Registered Agent; Principal Office; Other
Offices. Unless and until changed by the General Partner, the registered office
of the Partnership in the State of Delaware shall be located at 615 South DuPont
Highway, City of Dover, County of Kent, Delaware 19901, and the registered agent
for service of process on the Partnership in the State of Delaware at such
registered office shall be National Corporate Research, Ltd. The principal
office of the Partnership shall be located at 8150 North Central Expressway,
Suite 1525, Dallas, Texas 75206 or such other place as the General Partner may
from time to time designate by notice to the Limited Partners. The Partnership
may maintain offices at such other place or places within or outside the State
of Delaware as the General Partner deems necessary or appropriate. The address
of the General Partner shall be 8150 North Central Expressway, Suite 1525,
Dallas, Texas 75206 or such other place as the General Partner may from time to
time designate by notice to the Limited Partners.
 
 
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SECTION 2.4     Purpose and Business. The purpose and nature of the business to
be conducted by the Partnership shall be to:
 
 
(a)
engage directly in, or enter into or form any corporation, partnership, joint
venture, limited liability company or other arrangement to engage indirectly in,
any business activity that is approved by the General Partner and which lawfully
may be conducted by a limited partnership organized pursuant to the Delaware Act
and, in connection therewith, to exercise all of the rights and powers conferred
upon the Partnership pursuant to the agreements relating to such business
activity;

 
 
(b)
own the equity of the general partner of the Operating Partnership and to serve
as a limited partner of the Operating Partnership and, in connection therewith,
to exercise all the rights and powers conferred upon the Partnership as a
partner of the Operating Partnership pursuant to the Operating Partnership
Agreement or otherwise; and

 
 
(c)
do anything necessary or appropriate to the foregoing, including the making of
capital contributions or loans to a Group Member;

 
provided, however, that the General Partner shall not cause the Partnership to
engage, directly or indirectly, in any business activity that the General
Partner determines would be reasonably likely to cause the Partnership to be
treated as an association taxable as a corporation or otherwise taxable as an
entity for federal income tax purposes. To the fullest extent permitted by law,
the General Partner has no obligation or duty to propose or approve, and may
decline to propose or approve, the conduct by the Partnership of any business.
 
SECTION 2.5     Powers. The Partnership shall be empowered to do any and all
acts and things necessary, appropriate, proper, advisable, incidental to or
convenient for the furtherance and accomplishment of the purposes and business
described in Section 2.4 and for the protection and benefit of the Partnership.
 
SECTION 2.6    Power of Attorney. Each Limited Partner and each Assignee hereby
constitutes and appoints the General Partner and, if a Liquidator shall have
been selected pursuant to Section 12.3, the Liquidator (and any successor to the
Liquidator by merger, transfer, assignment, election or otherwise) and each of
their authorized officers and attorneys-in-fact, as the case may be, with full
power of substitution, as his true and lawful agent and attorney-in-fact, with
full power and authority in his name, place and stead, to:
 
 
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(a)
execute, swear to, acknowledge, deliver, file and record in the appropriate
public offices (A) all certificates, documents and other instruments (including
this Agreement and the Certificate of Limited Partnership and all amendments or
restatements hereof or thereof) that the General Partner or the Liquidator deems
necessary or appropriate to form, qualify or continue the existence or
qualification of the Partnership as a limited partnership (or a partnership in
which the limited partners have limited liability) in the State of Delaware and
in all other jurisdictions in which the Partnership may conduct business or own
property; (B) all certificates, documents and other instruments that the General
Partner or the Liquidator deems necessary or appropriate to reflect, in
accordance with its terms, any amendment, change, modification or restatement of
this Agreement; (C) all certificates, documents and other instruments (including
conveyances and a certificate of cancellation) that the General Partner or the
Liquidator deems necessary or appropriate to reflect the dissolution and
liquidation of the Partnership pursuant to the terms of this Agreement; (D) all
certificates, documents and other instruments relating to the admission,
withdrawal, removal or substitution of any Partner pursuant to, or other events
described in, Article IV, X, XI or XII; (E) all certificates, documents and
other instruments relating to the determination of the rights, preferences and
privileges of any class or series of Partnership Interests issued pursuant to
Section 5.5; and (F) all certificates, documents and other instruments
(including agreements and a certificate of merger) relating to a merger or
consolidation of the Partnership pursuant to Article XIV; and

 
 
(b)
execute, swear to, acknowledge, deliver, file and record all ballots, consents,
approvals, waivers, certificates, documents and other instruments necessary or
appropriate, in the discretion of the General Partner or the Liquidator, to
make, evidence, give, confirm or ratify any vote, consent, approval, agreement
or other action that is made or given by the Partners hereunder or is consistent
with the terms of this Agreement or is necessary or appropriate, in the
discretion of the General Partner or the Liquidator, to effectuate the terms or
intent of this Agreement; provided, that when required by Section 13.3 or any
other provision of this Agreement that establishes a percentage of the Limited
Partners or of the Limited Partners of any class or series required to take any
action, the General Partner and the Liquidator may exercise the power of
attorney made in this Section 2.6(b) only after the necessary vote, consent or
approval of the Limited Partners or of the Limited Partners of such class or
series, as applicable. Nothing contained in this Section 2.6(b) shall be
construed as authorizing the General Partner to amend this Agreement except in
accordance with Article XIII or as may be otherwise expressly provided for in
this Agreement.

 
The foregoing power of attorney is hereby declared to be irrevocable and a power
coupled with an interest, and it shall survive and, to the maximum extent
permitted by law, not be affected by the subsequent death, incompetency,
disability, incapacity, dissolution, bankruptcy or termination of any Limited
Partner or Assignee and the transfer of all or any portion of such Limited
Partner’s or Assignee’s Partnership Interest and shall extend to such Limited
Partner’s or Assignee’s heirs, successors, assigns and personal representatives.
Each Limited Partner or Assignee hereby agrees to be bound by any representation
made by the General Partner or the Liquidator acting in good faith pursuant to
such power of attorney; and each Limited Partner or Assignee hereby waives, to
the maximum extent permitted by law, any and all defenses that may be available
to contest, negate or disaffirm the action of the General Partner or the
Liquidator taken in good faith under such power of attorney. Each Limited
Partner or Assignee shall execute and deliver to the General Partner or the
Liquidator, within 15 days after receipt of the request therefor, such further
designation, powers of attorney and other instruments as the General Partner or
the Liquidator deems necessary to effectuate this Agreement and the purposes of
the Partnership.
 
SECTION 2.7     Term. The term of the Partnership commenced upon the filing of
the Certificate of Limited Partnership in accordance with the Delaware Act and
shall continue in existence until the dissolution of the Partnership in
accordance with the provisions of Article XII. The existence of the Partnership
as a separate legal entity shall continue until the cancellation of the
Certificate of Limited Partnership as provided in the Delaware Act.
 
 
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SECTION 2.8     Title to Partnership Assets. Title to Partnership assets,
whether real, personal or mixed and whether tangible or intangible, shall be
deemed to be owned by the Partnership as an entity, and no Partner or Assignee,
individually or collectively, shall have any ownership interest in such
Partnership assets or any portion thereof. Title to any or all of the
Partnership assets may be held in the name of the Partnership, the General
Partner, one or more of its Affiliates or one or more nominees, as the General
Partner may determine. The General Partner hereby declares and warrants that any
Partnership assets for which record title is held in the name of the General
Partner or one or more of its Affiliates or one or more nominees shall be held
by the General Partner or such Affiliate or nominee for the use and benefit of
the Partnership in accordance with the provisions of this Agreement; provided,
however, that the General Partner shall use reasonable efforts to cause record
title to such assets (other than those assets in respect of which the General
Partner determines that the expense and difficulty of conveyancing makes
transfer of record title to the Partnership impracticable) to be vested in the
Partnership as soon as reasonably practicable; provided, further, that, prior to
the withdrawal or removal of the General Partner or as soon thereafter as
practicable, the General Partner shall use reasonable efforts to effect the
transfer of record title to the Partnership and, prior to any such transfer,
will provide for the use of such assets in a manner satisfactory to the General
Partner. All Partnership assets shall be recorded as the property of the
Partnership in its books and records, irrespective of the name in which record
title to such Partnership assets is held.
 
SECTION 2.9     Certain Undertakings Relating to Separateness.
 
 
(a)
Separateness Generally. The Partnership shall conduct its businesses and
operations separate and apart from those of any other Person, except the General
Partner and the Partnership Group, in accordance with this Section 2.9.

 
 
(b)
Separate Records. The Partnership shall (i) maintain its books and records and
its accounts separate from those of any other Person, (ii) maintain its
financial records, which will be used in its ordinary course of business,
showing its assets and liabilities separate and apart from those of any other
Person, except their consolidated Subsidiaries, (iii) not have its assets and/or
liabilities included in the consolidated financial statement of any Affiliate of
the Company (other than the inclusion of the assets and/or liabilities of the
Partnership and its Subsidiaries in the consolidated financial statements of the
General Partner) unless appropriate notation shall be made on such Affiliate’s
consolidated financial statements to indicate the separateness of the
Partnership and the General Partner and their assets and liabilities from such
Affiliate and the assets and liabilities of such Affiliate, and to indicate that
the assets and liabilities of the Partnership and the General Partner are not
available to satisfy the debts and other obligations of such Affiliate, and
(iv) file its own tax returns separate from those of any other Person, except
(A) to the extent that the Partnership (x) is treated as a “disregarded entity”
for tax purposes or (y) is not otherwise required to file tax returns under
Applicable Law or (B) as may otherwise be required by Applicable Law.

 
 
(c)
Separate Assets. The Partnership shall not commingle or pool its funds or other
assets with those of any other Person, except its Subsidiaries and shall
maintain its assets in a manner that is not costly or difficult to segregate,
ascertain or otherwise identify as separate from those of any other Person.

 
 
(d)
Separate Name. The Partnership shall (i) conduct its businesses in its own name
or the name of its Subsidiaries, (ii) use separate stationery, invoices and
checks, (iii) correct any known misunderstanding regarding its separate identity
from that of any other Person, and (iv) generally hold itself out as an entity
separate from any other Person.

 
 
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(e)
Separate Credit. The Partnership shall (i) pay its obligations and liabilities
from its own funds (whether on hand or borrowed), (ii) maintain adequate capital
in light of its business operations, (iii) not guarantee or become obligated for
the debts of any other Person, other than its Subsidiaries, (iv) not hold out
its credit as being available to satisfy the obligations or liabilities of any
other Person except its Subsidiaries, (v) not acquire debt obligations or debt
securities (other its Subsidiaries), (vi) not pledge its assets for the benefit
of any Person or make loans or advances to any Person, except its Subsidiaries,
or (vii) use its commercially reasonable efforts to cause the operative
documents under which it borrows money, is an issuer of debt securities, or
guarantees any such borrowing or issuance after the Closing Date, to contain
provisions to the effect that (A) the lenders or purchasers of debt securities,
respectively, acknowledge that they have advanced funds or purchased debt
securities, respectively, in reliance upon the separateness of the Partnership
from any other Persons and (B) the Partnership has assets and liabilities that
are separate from those of other Persons.

 
 
(f)
Separate Formalities. The Partnership shall (i) observe all partnership
formalities and other formalities required by its organizational documents, the
laws of the jurisdiction of its formation, or other laws, rules, regulations and
orders of Governmental Authorities exercising jurisdiction over it, and
(ii) engage in transactions with its Affiliates and the General Partner in
conformity with the requirements of Section 7.9. Each material contract between
the Partnership, on the one hand, and its Affiliates, on the other hand, shall
be subject to the requirements of Section 7.9, and must be (x) approved by
Special Approval or (y) on terms objectively demonstrable to be no less
favorable to the Partnership than those generally being provided to or available
from unrelated third parties, and in any event must be in writing.

 
 
(g)
No Effect. Failure by the Partnership to comply with any of the obligations set
forth above shall not affect the status of the Partnership as a separate legal
entity, with its separate assets and separate liabilities.

 
ARTICLE III
 
RIGHTS OF LIMITED PARTNERS
 
SECTION 3.1     Limitation of Liability. The Limited Partners and the Assignees
shall have no liability under this Agreement except as expressly provided in
this Agreement or the Delaware Act.
 
SECTION 3.2     Management of Business. No Limited Partner or Assignee, in its
capacity as such, shall participate in the operation, management or control
(within the meaning of the Delaware Act) of the Partnership’s business, transact
any business in the Partnership’s name or have the power to sign documents for
or otherwise bind the Partnership. Any action taken by any Affiliate of the
General Partner or any officer, director, employee, manager, member, general
partner, agent or trustee of the General Partner or any of its Affiliates, or
any officer, director, employee, manager, member, general partner, agent or
trustee of a Group Member, in its capacity as such, shall not be deemed to be
participation in the control of the business of the Partnership by a limited
partner of the Partnership (within the meaning of Section 17-303(a) of the
Delaware Act) and shall not affect, impair or eliminate the limitations on the
liability of the Limited Partners or Assignees under this Agreement.
 
 
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SECTION 3.3     Outside Activities of the Limited Partners. Subject to the
provisions of Section 7.5, which shall continue to be applicable to the Persons
referred to therein, regardless of whether such Persons shall also be Limited
Partners or Assignees, any Limited Partner or Assignee shall be entitled to and
may have business interests and engage in business activities in addition to
those relating to the Partnership, including business interests and activities
in direct competition with the Partnership Group. Neither the Partnership nor
any of the other Partners or Assignees shall have any rights by virtue of this
Agreement in any business ventures of any Limited Partner or Assignee.
 
SECTION 3.4     Rights of Limited Partners.
 
 
(a)
In addition to other rights provided by this Agreement or by applicable law, and
except as limited by Section 3.4(b), each Limited Partner shall have the right,
for a purpose reasonably related to such Limited Partner’s interest as a limited
partner in the Partnership, upon reasonable written demand stating the purpose
of such demand and at such Limited Partner’s own expense:

 
 
(i)
to obtain true and full information regarding the status of the business and
financial condition of the Partnership;

 
 
(ii)
promptly after becoming available, to obtain a copy of the Partnership’s
federal, state and local income tax returns for each taxable period;

 
 
(iii)
to obtain a current list of the name and last known business, residence or
mailing address of each Partner;

 
 
(iv)
to obtain a copy of this Agreement and the Certificate of Limited Partnership
and all amendments thereto, together with executed copies of all powers of
attorney pursuant to which this Agreement, the Certificate of Limited
Partnership and all amendments thereto have been executed;

 
 
(v)
to obtain true and full information regarding the amount of cash and a
description and statement of the Net Agreed Value of any other Capital
Contribution by each Partner and that each Partner has agreed to contribute in
the future, and the date on which each became a Partner; and

 
 
(vi)
to obtain such other information regarding the affairs of the Partnership as is
just and reasonable.

 
 
(b)
The General Partner shall keep confidential from the Limited Partners and
Assignees, for such period of time as the General Partner deems reasonable,
(i) any information that the General Partner reasonably believes to be in the
nature of trade secrets or (ii) other information the disclosure of which the
General Partner in good faith believes (A) is not in the best interests of the
Partnership Group, (B) could damage the Partnership Group or its business or
(C) that any Group Member is required by law or by agreement with any third
party to keep confidential (other than agreements with Affiliates of the
Partnership the primary purpose of which is to circumvent the obligations set
forth in this Section 3.4).

 
 
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ARTICLE IV
 
CERTIFICATES; RECORD HOLDERS; TRANSFER OF PARTNERSHIP INTERESTS;
REDEMPTION OF PARTNERSHIP INTERESTS
 
SECTION 4.1     Certificates. Notwithstanding anything otherwise to the contrary
herein, unless the General Partner shall determine otherwise in respect of some
or all of any or all classes of Partnership Interests, Partnership Interests
shall not be evidenced by certificates. Certificates that may be issued shall be
executed on behalf of the Partnership by the Chairman of the Board, Chief
Executive Officer, President or any Executive Vice President or Vice President
and the Chief Financial Officer or the Secretary or any Assistant Secretary of
the General Partner. If a Transfer Agent has been appointed for a class of
Partnership Interests, no Certificate for such class of Partnership Interests
shall be valid for any purpose until it has been countersigned by the Transfer
Agent; provided, however, that if the General Partner elects to cause the
Partnership to issue Partnership Interests of such class in global form, the
Certificate shall be valid upon receipt of a certificate from the Transfer Agent
certifying that the Partnership Interests have been duly registered in
accordance with the directions of the Partnership.
 
SECTION 4.2     Mutilated, Destroyed, Lost or Stolen Certificates.
 
 
(a)
If any mutilated Certificate is surrendered to the Transfer Agent, the
appropriate officers of the General Partner on behalf of the Partnership shall
execute, and the Transfer Agent shall countersign and deliver in exchange
therefor, a new Certificate or issue uncertificated Units evidencing the same
number and type of Partnership Interests as the Certificate so surrendered.

 
 
(b)
The appropriate officers of the General Partner on behalf of the Partnership
shall execute and deliver, and the Transfer Agent shall countersign, a new
Certificate in place of any Certificate previously issued or issue
uncertificated Units if the Record Holder of the Certificate:

 
 
(i)
makes proof by affidavit, in form and substance satisfactory to the General
Partner, that a previously issued Certificate has been lost, destroyed or
stolen;

 
 
(ii)
requests the issuance of a new Certificate or the issuance of uncertificated
Units before the General Partner has notice that the Certificate has been
acquired by a purchaser for value in good faith and without notice of an adverse
claim;

 
 
(iii)
if requested by the General Partner, delivers to the General Partner a bond, in
form and substance satisfactory to the General Partner, with surety or sureties
and with fixed or open penalty as the General Partner may reasonably direct to
indemnify the Partnership, the Partners, the General Partner and the Transfer
Agent against any claim that may be made on account of the alleged loss,
destruction or theft of the Certificate; and

 
 
(iv)
satisfies any other reasonable requirements imposed by the General Partner.

 
If a Limited Partner or Assignee fails to notify the General Partner within a
reasonable time after he has notice of the loss, destruction or theft of a
Certificate, and a transfer of the Limited Partner Interests represented by the
Certificate is registered before the Partnership, the General Partner or the
Transfer Agent receives such notification, the Limited Partner or Assignee shall
be precluded from making any claim against the Partnership, the General Partner
or the Transfer Agent for such transfer or for a new Certificate or
uncertificated Units.
 
 
(c)
As a condition to the issuance of any new Certificate or uncertificated Units
under this Section 4.2, the General Partner may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Transfer Agent) reasonably connected therewith.

 
 
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SECTION 4.3     Record Holders. The Partnership shall be entitled to recognize
the Record Holder as the Partner or Assignee with respect to any Partnership
Interest and, accordingly, shall not be bound to recognize any equitable or
other claim to or interest in such Partnership Interest on the part of any other
Person, regardless of whether the Partnership shall have actual or other notice
thereof, except as otherwise provided by law or any applicable rule, regulation,
guideline or requirement of any National Securities Exchange on which such
Partnership Interests are listed or admitted for trading. Without limiting the
foregoing, when a Person (such as a broker, dealer, bank, trust company or
clearing corporation or an agent of any of the foregoing) is acting as nominee,
agent or in some other representative capacity for another Person in acquiring
and/or holding Partnership Interests, as between the Partnership on the one
hand, and such other Persons on the other, such representative Person shall be
(a) the Record Holder of such Partnership Interest and (b) bound by this
Agreement and shall have the rights and obligations of a Partner or Assignee (as
the case may be) hereunder as, and to the extent, provided for herein.
 
SECTION 4.4     Transfer Generally.
 
 
(a)
The term “transfer,” when used in this Agreement with respect to a Partnership
Interest, shall mean a transaction (i) by which the General Partner assigns its
General Partner Interest to another Person who becomes the general partner of
the Partnership, (ii) by which a holder of Incentive Distribution Rights assigns
its Incentive Distribution Rights to another Person, and includes a sale,
assignment, gift, pledge, encumbrance, hypothecation, mortgage, exchange or any
other disposition by law or otherwise or (iii) by which the holder of a Limited
Partner Interest assigns such Limited Partner Interest to another Person who is
or becomes a Limited Partner or an Assignee, and includes a sale, assignment,
gift, pledge, encumbrance, hypothecation, mortgage, exchange or any other
disposition by law or otherwise, excluding a pledge, encumbrance, hypothecation,
or mortgage but including any transfer upon foreclosure of any pledge,
encumbrance, hypothecation or mortgage.

 
 
(b)
No Partnership Interest shall be transferred, in whole or in part, except in
accordance with the terms and conditions set forth in this Article IV. Any
transfer or purported transfer of a Partnership Interest not made in accordance
with this Article IV shall be, to the fullest extent permitted by law, null and
void.

 
 
(c)
Nothing contained in this Agreement shall be construed to prevent a disposition
by any member of the General Partner of any or all of the limited liability
company interests of the General Partner. At any time, any member of the General
Partner may sell or transfer all or part of such member’s limited liability
company interests in the General Partner (so long as any such sale or transfer
is accomplished in compliance with the terms of the Second Amended and Restated
Limited Liability Company Agreement of the General Partner) without Limited
Partner approval and the term “transfer” shall not mean any such disposition.

 
 
(d)
The General Partner and its Affiliates shall have the right at any time to
transfer their Common Units, if any, to one or more Persons.

 
 
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SECTION 4.5     Registration and Transfer of Limited Partner Interests.
 
 
(a)
The Partnership shall keep or cause to be kept a register in which, subject to
such reasonable regulations as it may prescribe and subject to the provisions of
Section 4.5(b), the Partnership will provide for the registration and transfer
of Limited Partner Interests. The Transfer Agent is hereby appointed registrar
and transfer agent for the purpose of registering Limited Partner Interests and
transfers of such Limited Partner Interests as herein provided. The Partnership
shall not recognize transfers of Certificates evidencing Limited Partner
Interests or uncertificated Limited Partner Interests unless such transfers are
effected in the manner described in this Section 4.5. Upon surrender of a
Certificate for registration of transfer of any Limited Partner Interests
evidenced by a Certificate, and subject to the provisions of Section 4.5(b), the
appropriate officers of the General Partner on behalf of the Partnership shall
execute and deliver, and in the case of Certificates evidencing Limited Partner
Interests for which a Transfer Agent has been appointed, the Transfer Agent
shall countersign and deliver, in the name of the holder or the designated
transferee or transferees, as required pursuant to the holder’s instructions,
one or more new Certificates evidencing the same aggregate number and type of
Limited Partner Interests as was evidenced by the Certificate so surrendered, or
evidence of the issuance of uncertificated Limited Partner Interests.

 
 
(b)
The Partnership shall not recognize any transfer of Limited Partner Interests
evidenced by a Certificate until the Certificates evidencing such Limited
Partner Interests are surrendered for registration of transfer, or any evidence
of uncertificated Limited Partner Interests is surrendered together with proper
transfer instructions, as applicable, and such Certificates or transfer
instructions are accompanied by a Transfer Application duly executed by the
transferee (or the transferee’s attorney-in-fact duly authorized in writing). No
charge shall be imposed by the Partnership for such transfer; provided, that as
a condition to the issuance of any new Certificate, or issuance of
uncertificated Limited Partner Interests, under this Section 4.5, the
Partnership may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed with respect thereto. A transferee
of a Limited Partner Interest who has completed and delivered a Transfer
Application shall be deemed to have (i) requested admission as a Substituted
Limited Partner, (ii) agreed to comply with and be bound by and to have executed
this Agreement, (iii) represented and warranted that such transferee has the
right, power and authority and, if an individual, the capacity to enter into
this Agreement, (iv) granted the powers of attorney set forth in this Agreement
and (v) given the consents and approvals and made the waivers contained in this
Agreement.

 
 
(c)
By acceptance of the transfer of any Limited Partner Interest in accordance with
this Section 4.5 and except as provided in Section 4.9, each transferee of a
Limited Partner Interest (including any nominee holder or an agent or
representative acquiring such Limited Partner Interests for the account of
another Person) (i) shall be admitted to the Partnership as a Limited Partner
with respect to the Limited Partner Interests so transferred to such Person when
any such transfer or admission is reflected in the books and records of the
Partnership and such Limited Partner becomes the Record Holder of the Limited
Partner Interests so transferred, (ii) shall become bound, and shall be deemed
to have agreed to be bound, by the terms of this Agreement, (iii) represents
that the transferee has the capacity, power and authority to enter into this
Agreement and (iv) makes the consents, acknowledgements and waivers contained in
this Agreement, all with or without execution of this Agreement by such Person.
The transfer of any Limited Partner Interests and the admission of any new
Limited Partner shall not constitute an amendment to this Agreement.

 
 
(d)
Subject to (i) the foregoing provisions of this Section 4.5, Section 4.3 and
Section 4.8, (ii) with respect to any class or series of Limited Partner
Interests, the provisions of any statement of designations or an amendment to
this Agreement establishing such class or series of Limited Partner Interests,
(iii) any contractual provisions binding on any Limited Partner and
(iv) provisions of applicable law including the Securities Act, Limited Partner
Interests (other than the Incentive Distribution Rights) shall be freely
transferable.

 
 
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SECTION 4.6     Transfer of the General Partner’s General Partner Interest.
 
 
(a)
Subject to Section 4.6(b) below, the General Partner may transfer all or any of
its General Partner Interest without Limited Partner approval.

 
 
(b)
Notwithstanding anything herein to the contrary, no transfer by the General
Partner of all or any part of its General Partner Interest to another Person
shall be permitted unless (i) the transferee agrees to assume the rights and
duties of the General Partner under this Agreement and to be bound by the
provisions of this Agreement, (ii) the Partnership receives an Opinion of
Counsel that such transfer would not result in the loss of limited liability of
any Limited Partner or cause the Partnership to be treated as an association
taxable as a corporation or otherwise to be taxed as an entity for federal
income tax purposes (to the extent not already so treated or taxed) and (iii)
such transferee also agrees to purchase all (or the appropriate portion thereof,
if applicable) of the partnership or membership interest held by the General
Partner as the general partner or managing member, if any, of each other Group
Member. In the case of a transfer pursuant to and in compliance with this
Section 4.6, the transferee or successor (as the case may be) shall, subject to
compliance with the terms of Section 10.3, be admitted to the Partnership as the
General Partner immediately prior to the transfer of the General Partner
Interest, and the business of the Partnership shall continue without
dissolution.

 
SECTION 4.7     Transfer of Incentive Distribution Rights. The General Partner
or any other holder of Incentive Distribution Rights may transfer any or all of
its Incentive Distribution Rights without Limited Partner approval.
Notwithstanding anything herein to the contrary, (i) the transfer of Common
Units issued pursuant to Section 5.9 shall not be treated as a transfer of all
or any part of the Incentive Distribution Rights and (ii) no transfer of
Incentive Distribution Rights to another Person shall be permitted unless the
transferee agrees to be bound by the provisions of this Agreement; provided,
however, that no such agreement shall be required for the pledge, encumbrance,
hypothecation or mortgage of the Incentive Distribution Rights.
 
SECTION 4.8     Restrictions on Transfers.
 
 
(a)
Notwithstanding the other provisions of this Article IV, no transfer of any
Partnership Interests shall be made if such transfer would (i) violate the then
applicable federal or state securities laws or rules and regulations of the SEC,
any state securities SEC or any other governmental authority with jurisdiction
over such transfer, (ii) terminate the existence or qualification of the
Partnership under the laws of the jurisdiction of its formation, or (iii) cause
the Partnership to be treated as an association taxable as a corporation or
otherwise to be taxed as an entity for federal income tax purposes (to the
extent not already so treated or taxed).

 
 
(b)
The General Partner may impose restrictions on the transfer of Partnership
Interests if it determines, with the advice of counsel, that such restrictions
are necessary or advisable to (i) avoid a significant risk of the Partnership
becoming taxable as a corporation or otherwise to be taxed as an entity for
federal income tax purposes or (ii) preserve the uniformity of the Limited
Partner Interests (or any class or classes thereof). The General Partner may
impose such restrictions by amending this Agreement; provided, however, that any
amendment that would result in the delisting or suspension of trading of any
class of Limited Partner Interests on the principal National Securities Exchange
on which such class of Limited Partner Interests is then listed or admitted to
trading must be approved, prior to such amendment being effected, by the holders
of at least a majority of the Outstanding Limited Partner Interests of such
class.

 
 
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(c)
Nothing contained in this Article IV, or elsewhere in this Agreement, shall
preclude the settlement of any transactions involving Partnership Interests
entered into through the facilities of any National Securities Exchange on which
such Partnership Interests are listed or admitted to trading.

 
 
(d)
Each certificate evidencing Partnership Interests shall bear a conspicuous
legend in substantially the following form:

 
THE HOLDER OF THIS SECURITY ACKNOWLEDGES FOR THE BENEFIT CENTRAL ENERGY PARTNERS
LP THAT THIS SECURITY MAY NOT BE SOLD, OFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED IF SUCH TRANSFER WOULD (A) VIOLATE THE THEN APPLICABLE FEDERAL OR
STATE SECURITIES LAWS OR RULES AND REGULATIONS OF THE SECURITIES AND EXCHANGE
COMMISSION, ANY STATE SECURITIES COMMISSION OR ANY OTHER GOVERNMENTAL AUTHORITY
WITH JURISDICTION OVER SUCH TRANSFER, (B) TERMINATE THE EXISTENCE OR
QUALIFICATION OF CENTRAL ENERGY PARTNERS LP UNDER THE LAWS OF THE STATE OF
DELAWARE, OR (C) CAUSE CENTRAL ENERGY PARTNERS LP TO BE TREATED AS AN
ASSOCIATION TAXABLE AS A CORPORATION OR OTHERWISE TO BE TAXED AS AN ENTITY FOR
FEDERAL INCOME TAX PURPOSES (TO THE EXTENT NOT ALREADY SO TREATED OR TAXED).
CENTRAL ENERGY GP LLC, THE GENERAL PARTNER OF CENTRAL ENERGY PARTNERS LP, MAY
IMPOSE ADDITIONAL RESTRICTIONS ON THE TRANSFER OF THIS SECURITY IF IT RECEIVES
AN OPINION OF COUNSEL THAT SUCH RESTRICTIONS ARE NECESSARY TO AVOID A
SIGNIFICANT RISK OF CENTRAL ENERGY PARTNERS LP BECOMING TAXABLE AS A CORPORATION
OR OTHERWISE BECOMING TAXABLE AS AN ENTITY FOR FEDERAL INCOME TAX PURPOSES. THE
RESTRICTIONS SET FORTH ABOVE SHALL NOT PRECLUDE THE SETTLEMENT OF ANY
TRANSACTIONS INVOLVING THIS SECURITY ENTERED INTO THROUGH THE FACILITIES OF ANY
NATIONAL SECURITIES EXCHANGE ON WHICH THIS SECURITY IS LISTED OR ADMITTED TO
TRADING.
 
 
(e)
In addition each certificate evidencing Partnership Interests shall bear a
conspicuous legend in substantially the following form until such time as the
Partnership Interest evidenced by such certificate is registered with the SEC or
can be transferred pursuant to an exemption from the registration requirements
of the Securities Act:

 
THE COMMON UNITS REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933 (THE “ACT”) AND ARE “RESTRCITED SECURITIES” AS THAT
TERM IS DEFINED IN RULE 144 UNDER THE ACT. THE SHARES MAY NOT BE OFFERED FOR
SALE,SOLD OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT, OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
ACT, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY.
 
 
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Section 4.9 
Eligibility Certificates; Ineligible Holders.

 
 
(a)
If at any time the General Partner determines, with the advice of counsel, that
(i) the Partnership’s status other than as an association taxable as a
corporation for U.S. federal income tax purposes or the failure of the
Partnership otherwise to be subject to an entity-level tax for U.S. federal,
state or local income tax purposes, coupled with the tax status (or lack of
proof of the federal income tax status) of one or more Limited Partners or
Assignees, has or will reasonably likely have a material adverse effect on the
maximum applicable rate that can be charged to customers by Subsidiaries of the
Partnership (a “Rate Eligibility Trigger ”), or (ii) any Group Member is subject
to any federal, state or local law or regulation that would create a substantial
risk of cancellation or forfeiture of any property in which the Group Member has
an interest based on the nationality, citizenship or other related status of a
Limited Partner or Assignee (a “Citizenship Eligibility Trigger ”); then, the
General Partner shall take any action it determines to be necessary or advisable
to (x) in the case of a Rate Eligibility Trigger, obtain such proof of the
federal income tax status of the Limited Partner or Assignee and, to the extent
relevant, their beneficial owners, as the General Partner determines to be
necessary to establish those Limited Partners whose federal income tax status
does not or would not have a material adverse effect on the maximum applicable
rate that can be charged to customers by Subsidiaries of the Partnership or (y)
in the case of a Citizenship Eligibility Trigger, obtain such proof of the
nationality, citizenship or other related status (or, if the General Partner is
a nominee holding for the account of another Person, the nationality,
citizenship or other related status of such Person) of the Limited Partner or
Assignee as the General Partner determines to be necessary to establish that the
Limited Partner’s or Assignee’s status as a Limited Partner does not or would
not subject any Group Member to a significant risk of cancellation or forfeiture
of any of its properties or interests therein.

 
 
(b)
Such actions of the General Partner may (i) include provisions requiring all
Limited Partners to certify as to their (and their beneficial owners’) status as
Eligible Holders upon demand and on a regular basis, as determined by the
General Partner, and may require transferees of Units to so certify prior to
being admitted to the Partnership as a Limited Partner (any such required
certificate, an “Eligibility Certificate”); and (ii) provide that any Limited
Partner or Assignee who fails to furnish to the General Partner within 30 days
after requested proof of its (and its beneficial owners’) status as an Eligible
Holder or if upon receipt of such Eligibility Certificate or other requested
information the General Partner determines that a Limited Partner or Assignee is
not an Eligible Holder (such a Limited Partner an “Ineligible Holder ”), the
Limited Partner Interests owned by such Limited Partner or Assignee shall be
subject to redemption in accordance with the provisions of Section 4.10. In
addition, the General Partner shall be substituted for each Limited Partner or
Assignee that is an Ineligible Holder as the Limited Partner in respect of the
Ineligible Holder’s Limited Partner Interests.

 
 
(c)
The General Partner shall, in exercising voting rights in respect of Limited
Partner Interests held by it on behalf of Ineligible Holders, distribute the
votes in the same ratios as the votes of Limited Partners (including the General
Partner and its Affiliates) in respect of Limited Partner Interests other than
those of Ineligible Holders are cast, either for, against or abstaining as to
the matter.

 
 
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(d)
Upon dissolution of the Partnership, an Ineligible Holder shall have no right to
receive a distribution in kind pursuant to Section 12.4 but shall be entitled to
the cash equivalent thereof, and the Partnership shall provide cash in exchange
for an assignment of the Ineligible Holder’s share of any distribution in kind.
Such payment and assignment shall be treated for Partnership purposes as a
purchase by the Partnership from the Ineligible Holder of his Limited Partner
Interest (representing his right to receive his share of such distribution in
kind).

 
 
(e)
At any time after he can and does certify that he has become an Eligible Holder,
an Ineligible Holder may, upon application to the General Partner, request that
with respect to any Limited Partner Interests of such Ineligible Holder not
redeemed pursuant to Section 4.10, such Ineligible Holder be admitted as a
Limited Partner, and upon approval of the General Partner, such Ineligible
Holder shall be admitted as a Limited Partner and shall no longer constitute an
Ineligible Holder and the General Partner shall cease to be deemed to be the
Limited Partner in respect of the Ineligible Holder’s Limited Partner Interests.

 
SECTION 4.10       Redemption of Partnership Interests of Ineligible Holders.
 
 
(a)
If at any time a Limited Partner or Assignee fails to furnish an Eligibility
Certification or other information requested within the 30-day period specified
in Section 4.9(b), or if upon receipt of such Eligibility Certification or other
information the General Partner determines, with the advice of counsel, that a
Limited Partner or Assignee is an Ineligible Holder, the Partnership may, unless
the Limited Partner or Assignee establishes to the satisfaction of the General
Partner that such Limited Partner or Assignee is not an Ineligible Holder or has
transferred his Limited Partner Interests to a Person who is an Eligible Holder
and who furnishes an Eligibility Certification to the General Partner prior to
the date fixed for redemption as provided below, redeem the Limited Partner
Interest of such Limited Partner or Assignee as follows:

 
 
(i)
The General Partner shall, not later than the 30th day before the date fixed for
redemption, give notice of redemption to the Limited Partner or Assignee, at his
last address designated on the records of the Partnership or the Transfer Agent,
by registered or certified mail, postage prepaid. The notice shall be deemed to
have been given when so mailed. The notice shall specify the Redeemable
Interests, the date fixed for redemption, the place of payment, that payment of
the redemption price will be made upon surrender of the Certificate evidencing
the Redeemable Interests, or, if such Redeemable Interests are uncertificated,
upon receipt of evidence satisfactory to the General Partner of the ownership of
the Redeemable Interests, and that on and after the date fixed for redemption no
further allocations or distributions to which the Limited Partner or Assignee
would otherwise be entitled in respect of the Redeemable Interests will accrue
or be made.

 
 
(ii)
The aggregate redemption price for Redeemable Interests shall be an amount equal
to the Current Market Price (the date of determination of which shall be the
date fixed for redemption) of Limited Partner Interests of the class to be so
redeemed multiplied by the number of Limited Partner Interests of each such
class included among the Redeemable Interests. The redemption price shall be
paid, in the discretion of the General Partner, in cash or by delivery of a
promissory note of the Partnership in the principal amount of the redemption
price, bearing interest at the rate of 5% annually and payable in three equal
annual installments of principal together with accrued interest, commencing one
year after the redemption date.

 
 
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(iii)
The Limited Partner or Assignee or his duly authorized representative shall be
entitled to receive the payment for the Redeemable Interests, at the place
specified in the notice of redemption on the redemption date upon (x), if
certificated, the delivery of the Certificate evidencing the Redeemable
Interests duly endorsed in blank or accompanied by an assignment duly executed
in blank or (y) if uncertificated, upon delivery of evidence satisfactory to the
General Partner of the ownership of the Redeemable Interests.

 
 
(iv)
After the redemption date, Redeemable Interests shall no longer constitute
issued and Outstanding Limited Partner Interests.

 
 
(b)
The provisions of this Section 4.10 shall also be applicable to Limited Partner
Interests held by a Limited Partner or Assignee as nominee of a Person
determined to be other than an Eligible Holder.

 
 
(c)
Nothing in this Section 4.10 shall prevent the recipient of a notice of
redemption from transferring his Limited Partner Interest before the redemption
date if such transfer is otherwise permitted under this Agreement. Upon receipt
of notice of such a transfer, the General Partner shall withdraw the notice of
redemption, provided the transferee of such Limited Partner Interest certifies
to the satisfaction of the General Partner that he is an Eligible Holder. If the
transferee fails to make such certification, such redemption shall be effected
from the transferee on the original redemption date.

 
ARTICLE V
 
CAPITAL CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS
 
SECTION 5.1        Organizational Contributions. In connection with the
formation of the Partnership under the Delaware Act, the General Partner
purchased a 2% General Partner Interest in the Partnership for $20.00 and has
been admitted as a General Partner of the Partnership, and the Organizational
Limited Partner purchased Common Units representing a 98% Limited Partner
Interest in the Partnership for $980.00 and has been admitted as a Limited
Partner of the Partnership. As of the Closing Date, the Organizational Limited
Partner shall cease to be a Limited Partner of the Partnership.
 
SECTION 5.2         Contributions by the General Partner and its Affiliates.
 
 
(a)
On or prior to the Closing Date and pursuant to the Contribution Agreement,
(i) the General Partner conveyed to the Partnership $1,000.00 in exchange for
the Incentive Distribution Rights, and (ii) the Organizational Limited Partner
contributed to the Partnership its limited partner interest in the Operating
Partnership as a Capital Contribution.

 
 
(b)
Upon the issuance of any additional Partnership Interests by the Partnership,
the General Partner shall be required to make additional Capital Contributions
equal to 2/98ths of any amount contributed to the Partnership by Persons in
exchange for such additional Partnership Interests. Except as set forth in the
immediately preceding sentence and Article XII, the General Partner shall not be
obligated to make any additional Capital Contributions to the Partnership.

 
 
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SECTION 5.3        Interest and Withdrawal. No interest shall be paid by the
Partnership on Capital Contributions. No Partner or Assignee shall be entitled
to the withdrawal or return of its Capital Contribution, except to the extent,
if any, that distributions made pursuant to this Agreement or upon termination
of the Partnership may be considered as such by law and then only to the extent
provided for in this Agreement. Except to the extent expressly provided in this
Agreement, no Partner or Assignee shall have priority over any other Partner or
Assignee either as to the return of Capital Contributions or as to profits,
losses or distributions. Any such return shall be a compromise to which all
Partners and Assignees agree within the meaning of Section 17-502(b) of the
Delaware Act.
 
SECTION 5.4         Capital Accounts.
 
 
(a)
The Partnership shall maintain for each Partner (or a beneficial owner of
Partnership Interests held by a nominee in any case in which the nominee has
furnished the identity of such owner to the Partnership in accordance with
Section 6031(c) of the Code or any other method acceptable to the General
Partner) owning a Partnership Interest a separate Capital Account with respect
to such Partnership Interest in accordance with the rules of Treasury Regulation
Section 1.704-1(b)(2)(iv). Such Capital Account shall be increased by (i) the
amount of all Capital Contributions made to the Partnership with respect to such
Partnership Interest pursuant to this Agreement and (ii) all items of
Partnership income and gain (including, without limitation, Simulated Gain,
income and gain exempt from tax) computed in accordance with Section 5.4(b) and
allocated with respect to such Partnership Interest pursuant to Section 6.1, and
decreased by (x) the amount of cash or Net Agreed Value of all actual and deemed
distributions of cash or property made with respect to such Partnership Interest
pursuant to this Agreement and (y) all items of Partnership deduction and loss
(including Simulated Depletion and Simulated Loss) computed in accordance with
Section 5.4(b) and allocated with respect to such Partnership Interest pursuant
to Section 6.1.

 
 
(b)
For purposes of computing the amount of any item of income, gain, loss,
deduction, Simulated Depletion, Simulated Gain or Simulated Loss that is to be
allocated pursuant to Article VI and is to be reflected in the Partners’ Capital
Accounts, the determination, recognition and classification of any such item
shall be the same as its determination, recognition and classification for
federal income tax purposes (including, without limitation, any method of
depreciation, cost recovery or amortization used for that purpose), provided,
that:

 
 
(i)
Solely for purposes of this Section 5.4, the Partnership shall be treated as
owning directly its proportionate share (as determined by the General Partner)
of all property owned by (x) any other Group Member that is classified as a
partnership for federal income tax purposes and (y) any other partnership,
limited liability company, unincorporated business or other entity classified as
a partnership for federal income tax purposes of which a Group Member is,
directly or indirectly, a partner, member or other equity holder.

 
 
(ii)
All fees and other expenses incurred by the Partnership to promote the sale of
(or to sell) a Partnership Interest that can neither be deducted nor amortized
under Section 709 of the Code, if any, shall, for purposes of Capital Account
maintenance, be treated as an item of deduction at the time such fees and other
expenses are incurred and shall be allocated among the Partners pursuant to
Section 6.1.

 
 
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(iii)
Except as otherwise provided in Treasury Regulation Section
1.704-1(b)(2)(iv)(m), the computation of all items of income, gain, loss,
deduction, Simulated Depletion, Simulated Gain and Simulated Loss shall be made
without regard to any election under Section 754 of the Code which may be made
by the Partnership and, as to those items described in Section 705(a)(1)(B) or
705(a)(2)(B) of the Code, without regard to the fact that such items are not
includable in gross income or are neither currently deductible nor capitalized
for federal income tax purposes. To the extent an adjustment to the adjusted tax
basis of any Partnership asset pursuant to Section 734(b) or 743(b) of the Code
is required, pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m), to be
taken into account in determining Capital Accounts, the amount of such
adjustment in the Capital Accounts shall be treated as an item of gain or loss.

 
 
(iv)
Any income, gain, loss, Simulated Gain or Simulated Loss attributable to the
taxable disposition of any Partnership property shall be determined as if the
adjusted basis of such property as of such date of disposition were equal in
amount to the Partnership’s Carrying Value with respect to such property as of
such date.

 
 
(v)
In accordance with the requirements of Section 704(b) of the Code, any
deductions for depreciation, cost recovery, amortization or Simulated Depletion
attributable to any Contributed Property shall be determined as if the adjusted
basis of such property on the date it was acquired by the Partnership were equal
to the Agreed Value of such property. Upon an adjustment pursuant to
Section 5.4(d) to the Carrying Value of any Partnership property subject to
depreciation, cost recovery or amortization, any further deductions for such
depreciation, cost recovery, amortization or Simulated Depletion attributable to
such property shall be determined (A) as if the adjusted basis of such property
were equal to the Carrying Value of such property immediately following such
adjustment and (B) using a rate of depreciation, cost recovery, amortization or
Simulated Depletion derived from the same method and useful life (or, if
applicable, the remaining useful life) as is applied for federal income tax
purposes; provided, however, that, if the asset has a zero adjusted basis for
federal income tax purposes, depreciation, cost recovery, amortization or
Simulated Depletion deductions shall be determined using any reasonable method
that the General Partner may adopt.

 
 
(vi)
If the Partnership’s adjusted basis in a depreciable or cost recovery property
is reduced for federal income tax purposes pursuant to Section 48(q)(1) or
48(q)(3) of the Code, the amount of such reduction shall, solely for purposes
hereof, be deemed to be an additional depreciation or cost recovery deduction in
the year such property is placed in service and shall be allocated among the
Partners pursuant to Section 6.1. Any restoration of such basis pursuant to
Section 48(q)(2) of the Code shall, to the extent possible, be allocated in the
same manner to the Partners to whom such deemed deduction was allocated.

 
 
(vii)
The Gross Liability Value of each Liability of the Partnership described in
Treasury Regulations Section 1.752-7(b)(3)(i) shall be adjusted at such times as
provided in this Agreement for an adjustment to Carrying Values. The amount of
any such adjustment shall be treated for purposes hereof as an item of loss (if
the adjustment increases the Carrying Value of such Liability of the
Partnership) or an item of gain (if the adjustment decreases the Carrying Value
of such Liability of the Partnership).

 
 
(c)
A transferee of a Partnership Interest shall succeed to a pro rata portion of
the Capital Account of the transferor relating to the Partnership Interest so
transferred.

 
 
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(d)
(i)
In accordance with Treasury Regulation Section 1.704-1(b)(2)(iv)(f), on an
issuance of additional Partnership Interests for cash or Contributed Property or
the conversion of the General Partner’s Combined Interest to Common Units
pursuant to Section 11.3(b), the Capital Account of all Partners and the
Carrying Value of each Partnership property immediately prior to such issuance
shall be adjusted upward or downward to reflect any Unrealized Gain or
Unrealized Loss attributable to such Partnership property, as if such Unrealized
Gain or Unrealized Loss had been recognized on an actual sale of each such
property immediately prior to such issuance and had been allocated to the
Partners at such time pursuant to Section 6.1(c) in the same manner as any item
of gain, loss, Simulated Gain or Simulated Loss actually recognized following an
event giving rise to the dissolution of the Partnership would have been
allocated. In determining such Unrealized Gain or Unrealized Loss, the aggregate
cash amount and fair market value of all Partnership assets (including, without
limitation, cash or cash equivalents) immediately prior to the issuance of
additional Partnership Interests shall be determined by the General Partner
using such reasonable method of valuation as it may adopt; provided, however,
that the General Partner, in arriving at such valuation, must take fully into
account the fair market value of the Partnership Interests of all Partners at
such time. The General Partner shall allocate such aggregate value among the
assets of the Partnership (in such manner as it determines) to arrive at a fair
market value for individual properties.

 
 
(ii)
In accordance with Treasury Regulation Section 1.704-1(b)(2)(iv)(f), immediately
prior to any actual or deemed distribution to a Partner of any Partnership
property (other than a distribution of cash that is not in redemption or
retirement of a Partnership Interest), the Capital Accounts of all Partners and
the Carrying Value of all Partnership property shall be adjusted upward or
downward to reflect any Unrealized Gain or Unrealized Loss attributable to such
Partnership property, as if such Unrealized Gain or Unrealized Loss had been
recognized in a sale of such property immediately prior to such distribution for
an amount equal to its fair market value, and had been allocated to the
Partners, at such time, pursuant to Section 6.1(c) in the same manner as any
item of gain, loss, Simulated Gain or Simulated Loss actually recognized
following an event giving rise to the dissolution of the Partnership would have
been allocated. In determining such Unrealized Gain or Unrealized Loss, the
aggregate cash amount and fair market value of all Partnership assets
(including, without limitation, cash or cash equivalents) immediately prior to a
distribution shall (A) in the case of an actual distribution which is not made
pursuant to Section 12.4 or in the case of a deemed distribution, be determined
and allocated in the same manner as that provided in Section 5.4(d)(i) or (B) in
the case of a liquidating distribution pursuant to Section 12.4, be determined
and allocated by the Liquidator using such reasonable method of valuation as it
may adopt.

 
SECTION 5.5       Issuances of Additional Partnership Interests.
 
 
(a)
The Partnership may issue additional Partnership Interests and options, rights,
warrants and appreciation rights relating to the Partnership Interests for any
Partnership purpose at any time and from time to time to such Persons for such
consideration and on such terms and conditions as the General Partner, all
without the approval of any Limited Partners.

 
 
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(b)
Each additional Partnership Interest authorized to be issued by the Partnership
pursuant to Section 5.5(a) may be issued in one or more classes, or one or more
series of any such classes, with such designations, preferences, rights, powers
and duties (which may be senior to existing classes and series of Partnership
Interests), as shall be fixed by the General Partner, including (i) the right to
share Partnership profits and losses or items thereof; (ii) the right to share
in Partnership distributions; (iii) the rights upon dissolution and liquidation
of the Partnership; (iv) whether, and the terms and conditions upon which, the
Partnership may redeem the Partnership Interest; (v) whether such Partnership
Interest is issued with the privilege of conversion or exchange and, if so, the
terms and conditions of such conversion or exchange; (vi) the terms and
conditions upon which each Partnership Interest will be issued, evidenced by
certificates and assigned or transferred; (vii) the method for determining the
Percentage Interest as to such Partnership Interest; and (viii) the right, if
any, of each such Partnership Interest to vote on Partnership matters, including
matters relating to the relative rights, preferences and privileges of such
Partnership Interest.

 
 
(c)
The General Partner is hereby authorized and directed to take all actions that
it deems necessary or appropriate in connection with (i) each issuance of
Partnership Interests and options (and the exercise thereof), rights (and the
exercise thereof), warrants (and the exercise thereof) and appreciation rights
relating to Partnership Interests pursuant to this Section 5.5, (ii) the
conversion of the General Partner Interest, or the Combined Interest, or any
Incentive Distribution Rights into Units pursuant to the terms of this
Agreement, (iii) the issuance of Common Units pursuant to Section 5.9, (iv) the
admission of such Persons as Limited Partners and (v) all additional issuances
of Partnership Interests. The General Partner is further authorized and directed
to specify the relative rights, powers and duties of the holders of the Units or
other Partnership Interests being so issued. The General Partner shall do all
things necessary to comply with the Delaware Act and is authorized and directed
to do all things it deems to be necessary or advisable in connection with any
future issuance of Partnership Interests or in connection with the conversion of
the General Partner Interest, the Combined Interest or any Incentive
Distribution Rights into Units pursuant to the terms of this Agreement,
including compliance with any statute, rule, regulation or guideline of any
federal, state or other governmental agency or any National Securities Exchange
on which the Units or other Partnership Interests are listed or admitted to
trading.

 
 
(d)
No fractional Units shall be issued by the Partnership.

 
SECTION 5.6        Limited Preemptive Right. Except as provided in this
Section 5.6 and in Section 5.2, no Person shall have any preemptive,
preferential or other similar right with respect to the issuance of any
Partnership Interest, whether unissued, held in the treasury or hereafter
created. The General Partner shall have the right, which it may from time to
time assign in whole or in part to any of its Affiliates, to purchase
Partnership Interests from the Partnership whenever, and on the same terms that,
the Partnership issues Partnership Interests to Persons other than the General
Partner and its Affiliates, to the extent necessary to maintain the Percentage
Interests of the General Partner and its Affiliates equal to that which existed
immediately prior to the issuance of such Partnership Interests.
 
 
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SECTION 5.7         Splits and Combinations.
 
 
(a)
Subject to Sections 5.7(d), 6.6 and 6.8 (dealing with adjustments of
distribution levels), the Partnership may make a Pro Rata distribution of
Partnership Interests to all Record Holders or may effect a subdivision or
combination of Partnership Interests so long as, after any such event, each
Partner shall have the same Percentage Interest in the Partnership as before
such event, and any amounts calculated on a per Unit basis (including any Common
Unit Arrearage or Cumulative Common Unit Arrearage) or stated as a number of
Units are proportionately adjusted retroactive to the beginning of the
Partnership, on such terms and conditions as the General Partner shall
determine, all without the approval of any Limited Partners.

 
 
(b)
Whenever such a distribution, subdivision or combination of Partnership
Interests is declared, the General Partner shall select a Record Date as of
which the distribution, subdivision or combination shall be effective and shall
send notice thereof at least 20 days prior to such Record Date to each Record
Holder as of a date not less than 10 days prior to the date of such notice. The
General Partner also may cause a firm of independent public accountants selected
by it to calculate the number of Partnership Interests to be held by each Record
Holder after giving effect to such distribution, subdivision or combination. The
General Partner shall be entitled to rely on any certificate provided by such
firm as conclusive evidence of the accuracy of such calculation.

 
 
(c)
Promptly following any such distribution, subdivision or combination, the
Partnership may issue Certificates or uncertificated Partnership Interests to
the Record Holders of Partnership Interests as of the applicable Record Date
representing the new number of Partnership Interests held by such Record
Holders, or the General Partner may adopt such other procedures as it may deem
appropriate to reflect such changes. If any such combination results in a
smaller total number of Partnership Interests Outstanding, the Partnership shall
require, as a condition to the delivery to a Record Holder of such new
Certificate or uncertificated Partnership Interests, as applicable, the
surrender of any Certificate held by such Record Holder immediately prior to
such Record Date.

 
 
(d)
The Partnership shall not issue fractional Units upon any distribution,
subdivision or combination of Units. If a distribution, subdivision or
combination of Units would result in the issuance of fractional Units but for
the provision of this Section 5.5(d), each fractional Unit shall be rounded to
the nearest whole Unit (and a 0.5 Unit shall be rounded to the next higher
Unit).

 
SECTION 5.8         Fully Paid and Non-Assessable Nature of Limited Partner
Interests. All Limited Partner Interests issued pursuant to, and in accordance
with the requirements of, this Article V shall be fully paid and non-assessable
Limited Partner Interests in the Partnership, except as such non-accessibility
may be affected by Section 17-607 or 17-804 of the Delaware Act.
 
 
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SECTION 5.9         Issuance of Common Units in Connection with Reset of
Incentive Distribution Rights.
 
 
(a)
Subject to the provisions of this Section 5.9, the holder of the Incentive
Distribution Rights (or, if there is more than one holder of the Incentive
Distribution Rights, the holders of a majority in interest of the Incentive
Distribution Rights) shall have the right, at any time when the Partnership has
made a distribution pursuant to Section 6.4(f) for each of the four most
recently completed Quarters and the amount of each such distribution did not
exceed Adjusted Operating Surplus for such Quarter, to make an election (the
“IDR Reset Election ”) to cause the Minimum Quarterly Distribution and the
Target Distributions to be reset in accordance with the provisions of Section
5.9(e) and, in connection therewith, the holder or holders of the Incentive
Distribution Rights will become entitled to receive their respective
proportionate share of a number of Common Units (the “IDR Reset Common Units ”)
derived by dividing (i) the average amount of cash distributions made by the
Partnership for the two full Quarters immediately preceding the giving of the
Reset Notice (as defined in Section 5.9(b)) in respect of the Incentive
Distribution Rights by (ii) the average of the cash distributions made by the
Partnership in respect of each Common Unit for the two full Quarters immediately
preceding the giving of the Reset Notice (the “Reset MQD”) (the number of Common
Units determined by such quotient is referred to herein as the “Aggregate
Quantity of IDR Reset Common Units ”). The Percentage Interest of the General
Partner after the issuance of the Aggregate Quantity of IDR Reset Common Units
shall equal the Percentage Interest of the General Partner prior to the issuance
of the Aggregate Quantity of IDR Reset Common Units and the General Partner
shall not be obligated to make any additional Capital Contribution to the
Partnership in order to maintain its Percentage Interest in connection
therewith. The making of the IDR Reset Election in the manner specified in
Section 5.9(b) shall cause the Minimum Quarterly Distribution and the Target
Distributions to be reset in accordance with the provisions of Section 5.9(e)
and, in connection therewith, the holder or holders of the Incentive
Distribution Rights will become entitled to receive Common Units on the basis
specified above, without any further approval required by the General Partner or
the Unitholders, at the time specified in Section 5.9(c) unless the IDR Reset
Election is rescinded pursuant to Section 5.9(d).

 
 
(b)
To exercise the right specified in Section 5.9(a), the holder of the Incentive
Distribution Rights (or, if there is more than one holder of the Incentive
Distribution Rights, the holders of a majority in interest of the Incentive
Distribution Rights) shall deliver a written notice (the “Reset Notice”) to the
Partnership. Within 10 Business Days after the receipt by the Partnership of
such Reset Notice, as the case may be, the Partnership shall deliver a written
notice to the holder or holders of the Incentive Distribution Rights of the
Partnership’s determination of the aggregate number of Common Units which each
holder of Incentive Distribution Rights will be entitled to receive.

 
 
(c)
The holder or holders of the Incentive Distribution Rights will be entitled to
receive the Aggregate Quantity of IDR Reset Common Units on the 15th Business
Day after receipt by the Partnership of the Reset Notice;  provided,
however,  that the issuance of Common Units to the holder or holders of the
Incentive Distribution Rights shall not occur prior to the approval of the
listing or admission for trading of such Common Units by the principal National
Securities Exchange upon which the Common Units are then listed or admitted for
trading if any such approval is required pursuant to the rules and regulations
of such National Securities Exchange.

 
 
(d)
If the principal National Securities Exchange upon which the Common Units are
then traded has not approved the listing or admission for trading of the Common
Units to be issued pursuant to this Section 5.9 on or before the 30th Business
Day following the Partnership’s receipt of the Reset Notice and such approval is
required by the rules and regulations of such National Securities Exchange, then
the holder of the Incentive Distribution Rights (or, if there is more than one
holder of the Incentive Distribution Rights, the holders of a majority in
interest of the Incentive Distribution Rights) shall have the right to either
rescind the IDR Reset Election or elect to receive other Partnership Interests
having such terms as the General Partner may approve, with the approval of the
Conflicts Committee, that will provide (i) the same economic value, in the
aggregate, as the Aggregate Quantity of IDR Reset Common Units would have had at
the time of the Partnership’s receipt of the Reset Notice, as determined by the
General Partner, and (ii) for the subsequent conversion of such Partnership
Interests into Common Units within not more than 12 months following the
Partnership’s receipt of the Reset Notice upon the satisfaction of one or more
conditions that are reasonably acceptable to the holder of the Incentive
Distribution Rights (or, if there is more than one holder of the Incentive
Distribution Rights, the holders of a majority in interest of the Incentive
Distribution Rights).

 
 
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(e)
The Minimum Quarterly Distribution, First Target Distribution, Second Target
Distribution and Third Target Distribution shall be adjusted at the time of the
issuance of Common Units or other Partnership Interests pursuant to this Section
5.9 such that (i) the Minimum Quarterly Distribution shall be reset to equal the
Reset MQD, (ii) the First Target Distribution shall be reset to equal 115% of
the Reset MQD, (iii) the Second Target Distribution shall be reset to equal to
125% of the Reset MQD and (iv) the Third Target Distribution shall be reset to
equal 150% of the Reset MQD.

 
 
(f)
Upon the issuance of IDR Reset Common Units pursuant to Section 5.9(a), the
Capital Account maintained with respect to the Incentive Distribution Rights
shall (A) first, be allocated to IDR Reset Common Units in an amount equal to
the product of (x) the Aggregate Quantity of IDR Reset Common Units and (y) the
Per Unit Capital Amount for an Initial Common Unit, and (B) second, any
remaining balance in such Capital Account will be retained by the holder of the
Incentive Distributions Rights. In the event that there is not a sufficient
Capital Account associated with the Incentive Distribution Rights to allocate
the full Per Unit Capital Amount for an Initial Common Unit to the IDR Reset
Common Units in accordance with clause (A) of this Section 5.9(f), the IDR Reset
Common Units shall be subject to Sections 6.1(d)(x)(B) and (C).

 
ARTICLE VI
 
ALLOCATIONS AND DISTRIBUTIONS
 
SECTION 6.1        Allocations for Capital Account Purposes. For purposes of
maintaining the Capital Accounts and in determining the rights of the Partners
among themselves, the Partnership’s items of income, gain, loss, deduction,
Simulated Depletion, Simulated Gain and Simulated Loss (computed in accordance
with Section 5.4(b)) shall be allocated among the Partners in each taxable
period as provided herein below.
 
 
(a)
Net Income. After giving effect to the special allocations set forth in
Section 6.1(d) and Section 6.1(e), Net Income for each taxable year and all
items of income, gain, loss, deduction and Simulated Gain taken into account in
computing Net Income for such taxable year shall be allocated as follows:

 
 
(i)
First, 100% to the General Partner, in an amount equal to the aggregate Net
Losses allocated to the General Partner pursuant to Section 6.1(b)(iii) for all
previous taxable periods until the aggregate Net Income allocated to the General
Partner pursuant to this Section 6.1(a)(i) for the current taxable period and
all previous taxable periods is equal to the aggregate Net Losses allocated to
the General Partner pursuant to Section 6.1(b)(iii) for all previous taxable
periods.

 
 
(ii)
Second, 2% to the General Partner, in an amount equal to the aggregate Net
Losses allocated to the General Partner pursuant to Section 6.1(b)(ii) for all
previous taxable periods and 98% to the Unitholders, in accordance with their
respective Percentage Interests, until the aggregate Net Income allocated to
such Partners pursuant to this Section 6.1(a)(ii) for the current taxable period
and all previous taxable periods is equal to the aggregate Net Losses allocated
to such Partners pursuant to Section 6.1(b)(ii) for all previous taxable
periods.

 
 
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(iii)
Third, 2% to the General Partner, and 98% to the Unitholders, Pro Rata.

 
 
(b)
Net Losses. After giving effect to the special allocations set forth in
Section 6.1(d) and Section 6.1(e), Net Losses for each taxable period and all
items of income, gain, loss, deduction and Simulated Gain taken into account in
computing Net Losses for such taxable period shall be allocated as follows:

 
 
(i)
First, 2% to the General Partner, and 98% to the Unitholders, Pro Rata, until
the aggregate Net Losses allocated pursuant to this Section 6.1(b)(i) for the
current taxable period and all previous taxable periods is equal to the
aggregate Net Income allocated to such Partners pursuant to Section 6.1(a)(iii)
for all previous taxable years, provided, that the Net Losses shall not be
allocated pursuant to this Section 6.1(b)(i) to the extent that such allocation
would cause any Unitholder to have a deficit balance in its Adjusted Capital
Account at the end of such taxable period (or increase any existing deficit
balance in its Adjusted Capital Account).

 
 
(ii)
Second, 2% to the General Partner, and 98% to the Unitholders, Pro Rata;
provided, that Net Losses shall not be allocated pursuant to this
Section 6.1(b)(ii) to the extent that such allocation would cause any Unitholder
to have a deficit balance in its Adjusted Capital Account at the end of such
taxable Period (or increase any existing deficit balance in its Adjusted Capital
Account).

 
 
(iii)
Third, the balance, if any, 100% to the General Partner.

 
 
(c)
Net Termination Gains and Losses. After giving effect to the special allocations
set forth in Section 6.1(d) or Section 6.1(e), all items of income, gain, loss,
deduction and Simulated Gain taken into account in computing Net Termination
Gain or Net Termination Loss for such taxable period shall be allocated in the
same manner as such Net Termination Gain or Net Termination Loss is allocated in
the manner set forth in this Section 6.1(c). All allocations under this
Section 6.1(c) shall be made after Capital Account balances have been adjusted
by all other allocations provided under this Section 6.1 and after all
distributions of Available Cash provided under Sections 6.4 and 6.5 have been
made; provided, however, that solely for purposes of this Section 6.1(c),
Capital Accounts shall not be adjusted for distributions made pursuant to
Section 12.4.

 
 
(i)
If a Net Termination Gain is recognized (or deemed recognized pursuant to
Section 5.4(d)), such Net Termination Gain (including a pro rata part of each
item of income, gain, loss, deduction and Simulated Gain taken into account in
computing the Net Termination Gain) shall be allocated among the Partners in the
following manner (and the Capital Accounts of the Partners shall be increased by
the amount so allocated in each of the following subclauses, in the order
listed, before an allocation is made pursuant to the next succeeding subclause):

 
 
(A)
First, to each Partner having a deficit balance in its Capital Account, in the
proportion that such deficit balance bears to the total deficit balances in the
Capital Accounts of all Partners, until each such Partner has been allocated Net
Termination Gain equal to any such deficit balance in its Capital Account.

 
 
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(B)
Second, 98% to all Unitholders holding Common Units, Pro Rata, and 2% to the
General Partner, until the Capital Account in respect of each Common Unit then
Outstanding is equal to the sum of (1) its Unrecovered Capital at the time plus
(2) the Minimum Quarterly Distribution for the Quarter during which the
Liquidation Date occurs, reduced by any distribution pursuant to
Section 6.4(a)(i) with respect to such Common Unit for such Quarter (the amount
determined pursuant to this clause (2) is hereinafter defined as the “Unpaid
MQD”) plus (3) any then existing Cumulative Common Unit Arrearage.

 
 
(C)
Third, 98% to all Unitholders, Pro Rata, and 2% to the General Partner, until
the Capital Account in respect of each Common Unit then Outstanding is equal to
the sum of (1) its Unrecovered Capital, plus (2) the Unpaid MQD, plus (3) any
then existing Cumulative Common Unit Arrearage, plus (4) the excess of (aa) the
First Target Distribution less the Minimum Quarterly Distribution for each
Quarter of the Partnership’s existence over (bb) the cumulative per Unit amount
of any distributions of Available Cash that is deemed to be Operating Surplus
made pursuant to Section 6.4(a)(iii) (the sum of (1) plus (2) plus (3) plus (4)
is hereinafter defined as the “First Liquidation Target Amount”).

 
 
(D)
Fourth, 85% to all Unitholders, Pro Rata, 13% to the holders of the Incentive
Distribution Rights, Pro Rata, and 2% to the General Partner, until the Capital
Account in respect of each Common Unit then Outstanding is equal to the sum of
(1) the First Liquidation Target Amount, plus (2) the excess of (aa) the Second
Target Distribution less the First Target Distribution for each Quarter of the
Partnership’s existence over (bb) the cumulative per Unit amount of any
distributions of Available Cash that is deemed to be Operating Surplus made
pursuant to Section 6.4(a)(iv) (the sum of (1) plus (2) is hereinafter defined
as the “Second Liquidation Target Amount”).

 
 
(E)
Fifth, 75% to all Unitholders, Pro Rata, 23% to the holders of the Incentive
Distribution Rights, Pro Rata, and 2% to the General Partner, until the Capital
Account in respect of each Common Unit then Outstanding is equal to the sum of
(1) the Second Liquidation Target Amount, plus (2) the excess of (aa) the Third
Target Distribution less the Second Target Distribution for each Quarter of the
Partnership’s existence over (bb) the cumulative per Unit amount of any
distributions of Available Cash that is deemed to be Operating Surplus made
pursuant to Section 6.4(a)(v) (the sum of (1) plus (2) is hereinafter defined as
the “Third Liquidation Target Amount”).

 
 
(F)
Finally, any remaining amount 50% to all Unitholders, Pro Rata, 48% to the
holders of the Incentive Distribution Rights, Pro Rata, and 2% to the General
Partner.

 
 
(ii)
If a Net Termination Loss is recognized (or deemed recognized pursuant to
Section 5.4(d)), such Net Termination Loss (including a pro rata part of each
item of income, gain, loss, deduction and Simulated Gain taken into account in
computing the Net Termination Loss) shall be allocated among the Partners in the
following manner:

 
 
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(A)
First, 98% to all Unitholders holding Common Units, Pro Rata, and 2% to the
General Partner, until the Capital Account in respect of each Common Unit then
Outstanding has been reduced to zero. The limitation on the allocation of Net
Termination Loss that is contained in the preceding sentence is a Required
Allocation for purposes of the allocation of Curative Allocations in
Section 6.1(d)(xi).

 
 
(B)
Second, the balance, if any, 100% to the General Partner.

 
 
(d)
Special Allocations. Notwithstanding any other provision of this Section 6.1,
the following special allocations shall be made for such taxable period:

 
 
(i)
Partnership Minimum Gain Chargeback. Notwithstanding any other provision of this
Section 6.1, if there is a net decrease in Partnership Minimum Gain during any
Partnership taxable period, each Partner shall be allocated items of Partnership
income, gain and Simulated Gain for such period (and, if necessary, subsequent
periods) in the manner and amounts provided in Treasury Regulation Sections
1.704-2(f)(6), 1.704-2(g)(2) and 1.704-2(j)(2)(i), or any successor provision.
For purposes of this Section 6.1(d), each Partner’s Adjusted Capital Account
balance shall be determined, and the allocation of income, gain or Simulated
Gain required hereunder shall be effected, prior to the application of any other
allocations pursuant to this Section 6.1(d) with respect to such taxable period
(other than an allocation pursuant to Sections 6.1(d)(vi) and 6.1(d)(vii)). This
Section 6.1(d)(i) is intended to comply with the Partnership Minimum Gain
chargeback requirement in Treasury Regulation Section 1.704-2(f) and shall be
interpreted consistently therewith.

 
 
(ii)
Chargeback of Partner Nonrecourse Debt Minimum Gain. Notwithstanding the other
provisions of this Section 6.1 (other than Section 6.1(d)(i)), except as
provided in Treasury Regulation Section 1.704-2(i)(4), if there is a net
decrease in Partner Nonrecourse Debt Minimum Gain during any Partnership taxable
period, any Partner with a share of Partner Nonrecourse Debt Minimum Gain at the
beginning of such taxable period shall be allocated items of Partnership income,
gain and Simulated Gain for such period (and, if necessary, subsequent periods)
in the manner and amounts provided in Treasury Regulation Sections 1.704-2(i)(4)
and 1.704-2(j)(2)(ii), or any successor provisions. For purposes of this
Section 6.1(d), each Partner’s Adjusted Capital Account balance shall be
determined, and the allocation of income, gain or Simulated Gain required
hereunder shall be effected, prior to the application of any other allocations
pursuant to this Section 6.1(d), other than Section 6.1(d)(i) and other than an
allocation pursuant to Sections 6.1(d)(vi) and 6.1(d)(vii), with respect to such
taxable period. This Section 6.1(d)(ii) is intended to comply with the
chargeback of items of income and gain requirement in Treasury Regulation
Section 1.704-2(i)(4) and shall be interpreted consistently therewith.

 
 
(iii)
Priority Allocations.

 
 
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(A)
If the amount of cash or the Net Agreed Value of any property distributed
(except cash or property distributed pursuant to Section 12.4) to any class of
Unitholder with respect to its Units during a taxable period is greater (on a
per Unit basis) than the amount of cash or the Net Agreed Value of property
distributed any other class of Unitholders with respect to their Units (on a per
Unit basis) on such taxable period, then (1) each Unitholder receiving such
greater cash or property distribution shall be allocated gross income and gain
until the amount so allocated for the current taxable period and all previous
taxable periods pursuant to this clause (1) is equal to (aa) the amount by which
the distribution (on a per Unit basis) to such Unitholder exceeds the
distribution (on a per Unit basis) to the Unitholders receiving the smallest
distribution multiplied by (bb) the number of Units in respect of which such
greater distribution was made; and (2) the General Partner shall be allocated
gross income in an aggregate amount equal to 1/98th of the sum of the amounts
allocated in clause (1) above.

 
 
(B)
After the application of Section 6.1(d)(iii)(A), all or any portion of the
remaining items of Partnership gross income or gain for the taxable period, if
any, shall be allocated 100% to the holders of Incentive Distribution Rights,
Pro Rata, until the aggregate amount of such items allocated to the holders of
Incentive Distribution Rights pursuant to this Section 6.1(d)(iii)(B) for the
current taxable year and all previous taxable years is equal to the cumulative
amount of all Incentive Distributions made to the holders of Incentive
Distribution Rights from the Closing Date to a date 45 days after the end of the
current taxable year; and (2) to the General Partner an amount equal to the
product of (aa) an amount equal to the quotient determined by dividing (x) the
General Partner’s Percentage Interest by (y) the sum of 100 less the General
Partner’s Percentage Interest times (bb) the sum of the amounts allocated in
clause (1) above.

 
 
(iv)
Qualified Income Offset. Notwithstanding the other provisions of this
Section 6.1 (other than Sections 6.1(d)(i) and (d)(ii)), in the event any
Partner unexpectedly receives any adjustments, allocations or distributions
described in Treasury Regulation Sections 1.704-1(b)(2)(ii)(d)(4),
704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6), items of Partnership income
and gain shall be specially allocated to such Partner in an amount and manner
sufficient to eliminate, to the extent required by the Treasury Regulations
promulgated under Section 704(b) of the Code, the deficit balance, if any, in
its Adjusted Capital Account created by such adjustments, allocations or
distributions as quickly as possible; provided, that an allocation pursuant to
this Section 6.1(d)(iv) shall be made only if and to the extent that such
Partner would have a deficit balance in its Adjusted Capital Account as adjusted
after all other allocations provided for in this Section 6.1 have been
tentatively made as if this Section 6.1(d)(iv) were not in this Agreement.

 
 
(v)
Gross Income Allocations. In the event any Partner has a deficit balance in its
Capital Account at the end of any taxable period in excess of the sum of (A) the
amount such Partner is required to restore pursuant to the provisions of this
Agreement and (B) the amount such Partner is deemed obligated to restore
pursuant to Treasury Regulation Sections 1.704-2(g) and 1.704-2(i)(5), such
Partner shall be specially allocated items of Partnership gross income, gain and
Simulated Gain in the amount of such excess as quickly as possible; provided,
that an allocation pursuant to this Section 6.1(d)(v) shall be made only if and
to the extent that such Partner would have a deficit balance in its Capital
Account as adjusted after all other allocations provided for in this Section 6.1
have been tentatively made as if Section 6.1(d)(iv) and this Section 6.1(d)(v)
were not in this Agreement.

 
 
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(vi)
Nonrecourse Deductions. Nonrecourse Deductions for any taxable period shall be
allocated to the Partners Pro Rata. If the General Partner determines that the
Partnership’s Nonrecourse Deductions should be allocated in a different ratio to
satisfy the safe harbor requirements of the Treasury Regulations promulgated
under Section 704(b) of the Code, the General Partner is authorized, upon notice
to the other Partners, to revise the prescribed ratio to the numerically closest
ratio that does satisfy such requirements.

 
 
(vii)
Partner Nonrecourse Deductions. Partner Nonrecourse Deductions for any taxable
period shall be allocated 100% to the Partner that bears the Economic Risk of
Loss with respect to the Partner Nonrecourse Debt to which such Partner
Nonrecourse Deductions are attributable in accordance with Treasury Regulation
Section 1.704-2(i). If more than one Partner bears the Economic Risk of Loss
with respect to a Partner Nonrecourse Debt, such Partner Nonrecourse Deductions
attributable thereto shall be allocated between or among such Partners in
accordance with the ratios in which they share such Economic Risk of Loss.

 
 
(viii)
Nonrecourse Liabilities. For purposes of Treasury Regulation Section
1.752-3(a)(3), the Partners agree that Nonrecourse Liabilities of the
Partnership in excess of the sum of (A) the amount of Partnership Minimum Gain
and (B) the total amount of Nonrecourse Built-in Gain shall be allocated among
the Partners Pro Rata.

 
 
(ix)
Code Section 754 Adjustments. To the extent an adjustment to the adjusted tax
basis of any Partnership asset pursuant to Section 734(b) or 743(c) of the Code
is required, pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m), to be
taken into account in determining Capital Accounts, the amount of such
adjustment to the Capital Accounts shall be treated as an item of gain or
Simulated Gain (if the adjustment increases the basis of the asset) or loss or
Simulated Loss (if the adjustment decreases such basis), and such item of gain,
loss, Simulated Gain or Simulated Loss shall be specially allocated to the
Partners in a manner consistent with the manner in which their Capital Accounts
are required to be adjusted pursuant to such Section of the Treasury
Regulations.

 
 
(x)
Economic Uniformity; Changes in Law.

 
 
(A)
With respect to an event triggering an adjustment to the Carrying Value of
Partnership property pursuant to Section 5.4(d) during any taxable period of the
Partnership ending upon, or after, the issuance of IDR Reset Common Units
pursuant to Section 5.9, any Unrealized Gains and Unrealized Losses shall be
allocated among the Partners in a manner that to the nearest extent possible
results in the Capital Accounts maintained with respect to such IDR Reset Common
Units issued pursuant to Section 5.9 equaling the product of (A) the Aggregate
Quantity of IDR Reset Common Units and (B) the Per Unit Capital Amount for an
Initial Common Unit.

 
 
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(B)
With respect to any taxable period during which an IDR Reset Unit is transferred
to any Person who is not an Affiliate of the transferor, all or a portion of the
remaining items of Partnership gross income or gain for such taxable period
shall be allocated 100% to the transferor Partner of such transferred IDR Reset
Unit until such transferor Partner has been allocated an amount of gross income
or gain that increases the Capital Account maintained with respect to such
transferred IDR Reset Unit to an amount equal to the Per Unit Capital Amount for
an Initial Common Unit.

 
 
(C)
For the proper administration of the Partnership and for the preservation of
uniformity of the Limited Partner Interests (or any class or classes thereof),
the General Partner shall (i) adopt such conventions as it deems appropriate in
determining the amount of depreciation, amortization and cost recovery
deductions; (ii) make special allocations of income, gain, loss, deduction,
Unrealized Gain or Unrealized Loss; and (iii) amend the provisions of this
Agreement as appropriate (x) to reflect the proposal or promulgation of Treasury
Regulations under Section 704(b) or Section 704(c) of the Code or (y) otherwise
to preserve or achieve uniformity of the Limited Partner Interests (or any class
or classes thereof). The General Partner may adopt such conventions, make such
allocations and make such amendments to this Agreement as provided in this
Section 6.1(d)(x)(C) only if such conventions, allocations or amendments would
not have a material adverse effect on the Partners, the holders of any class or
classes of Limited Partner Interests issued and Outstanding or the Partnership,
and if such allocations are consistent with the principles of Section 704 of the
Code.

 
 
(xi)
Curative Allocation.

 
 
(A)
Notwithstanding any other provision of this Section 6.1, other than the Required
Allocations, the Required Allocations shall be taken into account in making the
Agreed Allocations so that, to the extent possible, the net amount of items of
income, gain, loss, deduction, Simulated Depletion, Simulated Gain and Simulated
Loss allocated to each Partner pursuant to the Required Allocations and the
Agreed Allocations, together, shall be equal to the net amount of such items
that would have been allocated to each such Partner under the Agreed Allocations
had the Required Allocations and the related Curative Allocation not otherwise
been provided in this Section 6.1 and Simulated Depletion and Simulated Loss had
been included in the definition of Net Income, Net Loss, Net Termination Gain
and Net Termination Loss. Notwithstanding the preceding sentence, Required
Allocations relating to (1) Nonrecourse Deductions shall not be taken into
account except to the extent that there has been a decrease in Partnership
Minimum Gain and (2) Partner Nonrecourse Deductions shall not be taken into
account except to the extent that there has been a decrease in Partner
Nonrecourse Debt Minimum Gain. Allocations pursuant to this
Section 6.1(d)(xi)(A) shall only be made with respect to Required Allocations to
the extent the General Partner reasonably determines that such allocations will
otherwise be inconsistent with the economic agreement among the Partners.
Further, allocations pursuant to this Section 6.1(d)(xi)(A) shall be deferred
with respect to allocations pursuant to clauses (1) and (2) hereof to the extent
the General Partner reasonably determines that such allocations are likely to be
offset by subsequent Required Allocations.

 
 
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(B)
The General Partner shall have reasonable discretion, with respect to each
taxable period, to (1) apply the provisions of Section 6.1(d)(xi)(A) in whatever
order is most likely to minimize the economic distortions that might otherwise
result from the Required Allocations, and (2) divide all allocations pursuant to
Section 6.1(d)(xi)(A) among the Partners in a manner that is likely to minimize
such economic distortions.

 
 
(xii)
Corrective and Other Allocations. In the event of any allocation of Additional
Book Basis Derivative Items or any Book-Down Event or any recognition of a Net
Termination Loss, the following rules shall apply:

 
 
(A)
Except as provided in Section 6.1(d)(xii)(B), in the case of any allocation of
Additional Book Basis Derivative Items (other than an allocation of Unrealized
Gain or Unrealized Loss under Section 5.4(d) hereof), the General Partner shall
allocate such Additional Book Basis Derivative Items to (1) the holders of
Incentive Distribution Rights and the General Partner to the same extent that
the Unrealized Gain or Unrealized Loss giving rise to such Additional Book Basis
Derivative Items was allocated to them pursuant to Section 5.4(d) and (2) all
Unitholders, Pro Rata, to the extent that the Unrealized Gain or Unrealized Loss
giving rise to such Additional Book Basis Derivative Items was allocated to any
Unitholders pursuant to Section 5.4(d).

 
 
(B)
In the case of any allocation of Additional Book Basis Derivative Items (other
than an allocation of Unrealized Gain or Unrealized Loss under Section 5.4(d)
hereof or an allocation of Net Termination Gain or Net Termination Loss pursuant
to Section 6.1(c) hereof) as a result of a sale or other taxable disposition of
any Partnership asset that is an Adjusted Property (“Disposed of Adjusted
Property”), the General Partner shall allocate (1) additional items of gross
income and gain (aa) away from the holders of Incentive Distribution Rights and
(bb) to the Unitholders, or (2) additional items of deduction and loss (aa) away
from the Unitholders and (bb) to the holders of Incentive Distribution Rights,
to the extent that the Additional Book Basis Derivative Items allocated to the
Unitholders or the General Partner exceed their Share of Additional Book Basis
Derivative Items with respect to such Disposed of Adjusted Property. Any
allocation made pursuant to this Section 6.1(d)(xii)(B) shall be made after all
of the other Agreed Allocations have been made as if this Section 6.1(d)(xii)(B)
were not in this Agreement and, to the extent necessary, shall require the
reallocation of items that have been allocated pursuant to such other Agreed
Allocations.

 
 
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(C)
In the case of any negative adjustments to the Capital Accounts of the Partners
resulting from a Book-Down Event or from the recognition of a Net Termination
Loss, such negative adjustment (1) shall first be allocated, to the extent of
the Aggregate Remaining Net Positive Adjustments, in such a manner, as
determined by the General Partner, that to the extent possible the aggregate
Capital Accounts of the Partners will equal the amount that would have been the
Capital Account balances of the Partners if no prior Book-Up Events had
occurred, and (2) any negative adjustment in excess of the Aggregate Remaining
Net Positive Adjustments shall be allocated pursuant to Section 6.1(c) hereof.

 
 
(D)
For purposes of this Section 6.1(d)(xii), the Unitholders shall be treated as
being allocated Additional Book Basis Derivative Items to the extent that such
Additional Book Basis Derivative Items have reduced the amount of income that
would otherwise have been allocated to the Unitholders under this Agreement. In
making the allocations required under this Section 6.1(d)(xii), the General
Partner may apply whatever conventions or other methodology it determines will
satisfy the purpose of this Section 6.1(d)(xii). Without limiting the foregoing,
if an Adjusted Property is contributed by the Partnership to another entity
classified as a partnership for federal income tax purposes (the “lower-tier
partnership”), the General Partner may make allocations similar to those
described in Sections 6.1(d)(xii)(A)–(C) to the extent the General Partner
determines such allocations are necessary to account for the Partnership’s
allocable share of income, gain, loss and deduction of the lower-tier
partnership that relate to the contributed Adjusted Property in a manner that is
consistent with the purpose of this Section 6.1(d)(xii).

 

 
(e) 
Simulated Depletion and Simulated Loss.

 
 
(i)
In accordance with Treasury Regulation Section 1.704-1(b)(2)(iv)(k), Simulated
Depletion with respect to each oil and gas property shall be allocated among the
General Partner and the Unitholders Pro Rata.

 
 
(ii)
Simulated Loss with respect to the disposition of an oil and gas property shall
be allocated among the Partners in proportion to their allocable share of the
total amount realized from such disposition under Section 6.2(c)(i).

 
SECTION 6.2       Allocations for Tax Purposes.
 
 
(a)
Except as otherwise provided herein, for federal income tax purposes, each item
of income, gain, loss and deduction shall be allocated among the Partners in the
same manner as its correlative item of “book” income, gain, loss or deduction is
allocated pursuant to Section 6.1.

 
 
(b)
The deduction for depletion with respect to each separate oil and gas property
(as defined in Code Section 614) shall be computed for federal income tax
purposes separately by the Partners rather than by the Partnership in accordance
with Code Section 613A(c)(7)(D). Except as provided in Section 6.2(c)(iii), for
purposes of such computation (before taking into account any adjustments
resulting from an election made by the Partnership Under Code Section 754), the
adjusted tax basis of each oil and gas property (as defined in Code Section 614)
shall be allocated among the Partners Pro Rata.

 
Each Partner shall separately keep records of his share of the adjusted tax
basis in each oil and gas property, allocated as provided above, adjust such
share of the adjusted tax basis for any cost or percentage depletion allowable
with respect to such property, and use such adjusted tax basis in the
computation of its cost depletion or in the computation of his gain or loss on
the disposition of such property by the Partnership.
 
 
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(c)
Except as provided in Section 6.2(c)(iii), for the purposes of the separate
computation of gain or loss by each Partner on the sale or disposition of each
separate oil and gas property (as defined in Code Section 614), the
Partnership’s allocable share of the “amount realized” (as such term is defined
in Code Section 1001(b)) from such sale or disposition shall be allocated for
federal income tax purposes among the Partners as follows:

 
 
(i)
first, to the extent such amount realized constitutes a recovery of the
Simulated Basis of the property, to the Partners in the same proportion as the
depletable basis of such property was allocated to the Partners pursuant to
Section 6.2(b) (without regard to any special allocation of basis under Section
6.2(c)(iii)); and

 
 
(ii)
second, the remainder of such amount realized, if any, to the Partners so that,
to the maximum extent possible, the amount realized allocated to each Partner
under this Section 6.2(c)(ii) will equal such Partner’s share of the Simulated
Gain recognized by the Partnership from such sale or disposition.

 
 
(iii)
The Partners recognize that with respect to Contributed Property and Adjusted
Property there will be a difference between the Carrying Value of such property
at the time of contribution or revaluation, as the case may be, and the adjusted
tax basis of such property at that time. All items of tax depreciation, cost
recovery, amortization, adjusted tax basis of depletable properties, amount
realize and gain or loss with respect to such Contributed Property and Adjusted
Property shall be allocated among the Partners to take into account the
disparities between the Carrying Values and the adjusted tax basis with respect
to such properties in accordance with the principles  of Treasury Regulation
Section 1.704-3(d).

 
 
(d)
In an attempt to eliminate Book-Tax Disparities attributable to a Contributed
Property or Adjusted Property, other than oil and gas properties pursuant to
Section 6.2(c), items of income, gain, loss, depreciation, amortization and cost
recovery deductions shall be allocated for federal income tax purposes among the
Partners as follows:

 
 
(i)
(A) In the case of a Contributed Property, such items attributable thereto shall
be allocated among the Partners in the manner provided under Section 704(c) of
the Code that takes into account the variation between the Agreed Value of such
property and its adjusted basis at the time of contribution; and (B) any item of
Residual Gain or Residual Loss attributable to a Contributed Property shall be
allocated among the Partners in the same manner as its correlative item of
“book” gain or loss is allocated pursuant to Section 6.1.

 
 
(ii)
(A) In the case of an Adjusted Property, such items shall (1) first, be
allocated among the Partners in a manner consistent with the principles of
Section 704(c) of the Code to take into account the Unrealized Gain or
Unrealized Loss attributable to such property and the allocations thereof
pursuant to Section 5.4(d)(i) or 5.4(d)(ii), and (2) second, in the event such
property was originally a Contributed Property, be allocated among the Partners
in a manner consistent with Section 6.2(b)(i)(A); and (B) any item of Residual
Gain or Residual Loss attributable to an Adjusted Property shall be allocated
among the Partners in the same manner as its correlative item of “book” gain or
loss is allocated pursuant to Section 6.1.

 
 
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(iii)
The General Partner shall apply the principles of Treasury Regulation Section
1.704-3(d) to eliminate Book-Tax Disparities.

 
 
(e)
For the proper administration of the Partnership and for the preservation of
uniformity of the Limited Partner Interests (or any class or classes thereof),
the General Partner shall have sole discretion to (i) adopt such conventions as
it deems appropriate in determining the amount of depreciation, amortization and
cost recovery deductions; (ii) make special allocations for federal income tax
purposes of income (including, without limitation, gross income) or deductions;
and (iii) amend the provisions of this Agreement as appropriate (x) to reflect
the proposal or promulgation of Treasury Regulations under Section 704(b) or
Section 704(c) of the Code (including without limitation Treasury Regulations
regarding compensatory and noncompensatory options) or (y) otherwise to preserve
or achieve uniformity of the Limited Partner Interests (or any class or classes
thereof). The General Partner may adopt such conventions, make such allocations
and make such amendments to this Agreement as provided in this Section 6.2(e)
only if such conventions, allocations or amendments would not have a material
adverse effect on the Partners, the holders of any class or classes of Limited
Partner Interests issued and Outstanding or the Partnership, and if such
allocations are consistent with the principles of Section 704 of the Code.
Additionally, the General Partner has the authority to amend the provisions of
this Agreement as necessary to conform to proposed or promulgated Treasury
Regulations under Subchapter K of the Code regarding compensatory and
noncompensatory options to acquire a Partnership Interest.

 
 
(f)
The General Partner in its discretion may determine to depreciate or amortize
the portion of an adjustment under Section 743(b) of the Code attributable to
unrealized appreciation in any Adjusted Property (to the extent of the
unamortized Book-Tax Disparity) using a predetermined rate derived from the
depreciation or amortization method and useful life applied to the Partnership’s
common basis of such property, despite any inconsistency of such approach with
Treasury Regulation Section 1.167(c)-l(a)(6) or any successor regulations
thereto. If the General Partner determines that such reporting position cannot
reasonably be taken, the General Partner may adopt depreciation and amortization
conventions under which all purchasers acquiring Limited Partner Interests in
the same month would receive depreciation and amortization deductions, based
upon the same applicable rate as if they had purchased a direct interest in the
Partnership’s property. If the General Partner chooses not to utilize such
aggregate method, the General Partner may use any other reasonable depreciation
and amortization conventions to preserve the uniformity of the intrinsic tax
characteristics of any Limited Partner Interests, so long as such convention
would not have a material adverse effect on the Limited Partners or the Record
Holders of any class or classes of Limited Partner Interests.

 
 
(g)
In accordance with Treasury Regulation Sections 1.1245-1(e) and 1.1250-1(f), any
gain allocated to the Partners upon the sale or other taxable disposition of any
Partnership asset shall, to the extent possible, after taking into account other
required allocations of gain pursuant to this Section 6.2, be characterized as
Recapture Income in the same proportions and to the same extent as such Partners
(or their predecessors in interest) have been allocated any deductions directly
or indirectly giving rise to the treatment of such gains as Recapture Income.

 
 
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(h)
All items of income, gain, loss, deduction and credit recognized by the
Partnership for federal income tax purposes and allocated to the Partners in
accordance with the provisions hereof shall be determined without regard to any
election under Section 754 of the Code which may be made by the Partnership;
provided, however, that such allocations, once made, shall be adjusted as
necessary or appropriate to take into account those adjustments permitted or
required by Sections 734 and 743 of the Code.

 
 
(i)
Each item of Partnership income, gain, loss and deduction shall for federal
income tax purposes, be determined on an annual basis and prorated on a monthly
basis and shall be allocated to the Partners as of the opening of the National
Securities Exchange on which the Partnership Interests are listed or admitted to
trading on the first Business Day of each month; provided, however, that gain or
loss on a sale or other disposition of any assets of the Partnership or any
other extraordinary item of income or loss realized and recognized other than in
the ordinary course of business, as determined by the General Partner, shall be
allocated to the Partners as of the opening of the National Securities Exchange
on which the Partnership Interests are listed or admitted to trading on the
first Business Day of the month in which such gain or loss is recognized for
federal income tax purposes. The General Partner may revise, alter or otherwise
modify such methods of allocation as it determines necessary or appropriate, to
the extent permitted or required by Section 706 of the Code and the regulations
or rulings promulgated thereunder.

 
 
(j)
Allocations that would otherwise be made to a Limited Partner under the
provisions of this Article VI shall instead be made to the beneficial owner of
Limited Partner Interests held by a nominee in any case in which the nominee has
furnished the identity of such owner to the Partnership in accordance with
Section 6031(c) of the Code or any other method determined by the General
Partner.

 
SECTION 6.3         Requirement and Characterization of Distributions;
Distributions to Record Holders.
 
 
(a)
Within 45 days following the end of each Quarter, an amount equal to 100% of
Available Cash with respect to such Quarter shall, subject to limitations on
distributions set forth in Section 17-607 of the Delaware Act, be distributed in
accordance with this Article VI by the Partnership to the Partners as of the
Record Date selected by the General Partner. All amounts of Available Cash
distributed by the Partnership on any date from any source shall be deemed to be
Operating Surplus until the sum of all amounts of Available Cash theretofore
distributed by the Partnership to the Partners pursuant to Section 6.4 equals
the Operating Surplus from the Closing Date through the close of the immediately
preceding Quarter. Any remaining amounts of Available Cash distributed by the
Partnership on such date shall, except as otherwise provided in Section 6.5, be
deemed to be “Capital Surplus.” All distributions required to be made under this
Agreement shall be made subject to Sections 17-607 and 17-804 of the Delaware
Act.

 
 
(b)
Notwithstanding Section 6.3(a), in the event of the dissolution and liquidation
of the Partnership, all receipts received during or after the Quarter in which
the Liquidation Date occurs, other than from Working Capital Borrowings, shall
be applied and distributed solely in accordance with, and subject to the terms
and conditions of, Section 12.4.

 
 
(c)
The General Partner shall have the discretion to treat taxes paid by the
Partnership on behalf of, or amounts withheld with respect to, all or less than
all of the Partners, as a distribution of Available Cash to such Partners.

 
 
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(d)
Each distribution in respect of a Partnership Interest shall be paid by the
Partnership, directly or through the Transfer Agent or through any other Person
or agent, only to the Record Holder of such Partnership Interest as of the
Record Date set for such distribution. Such payment shall constitute full
payment and satisfaction of the Partnership’s liability in respect of such
payment, regardless of any claim of any Person who may have an interest in such
payment by reason of an assignment or otherwise.

 
SECTION 6.4        Distributions of Available Cash from Operating Surplus.
Available Cash with respect to any Quarter that is deemed to be Operating
Surplus pursuant to the provisions of Section 6.3 or Section 6.5 shall be
distributed as follows, except as otherwise required by Section 5.5(b) in
respect of additional Partnership Interests issued pursuant thereto:
 
 
(a)
First, 98% to all Unitholders, Pro Rata, and 2% to the General Partner, until
there has been distributed in respect of each Unit then Outstanding an amount
equal to the Minimum Quarterly Distribution for such Quarter;

 
 
(b)
Second, 98% to the Unitholders, Pro Rata, and 2% to the General Partner, until
there has been distributed in respect of each Common Unit then Outstanding an
amount equal to the Cumulative Common Unit Arrearage existing with respect to
such Quarter;

 
 
(c)
Third, 98% to all Unitholders, Pro Rata, and 2% to the General Partner, until
there has been distributed in respect of each Unit then Outstanding an amount
equal to the excess of the First Target Distribution over the Minimum Quarterly
Distribution for such Quarter;

 
 
(d)
Fourth, 85% to all Unitholders, Pro Rata, 13% to the holders of the Incentive
Distribution Rights, Pro Rata, and 2% to the General Partner, until there has
been distributed in respect of each Unit then Outstanding an amount equal to the
excess of the Second Target Distribution over the First Target Distribution for
such Quarter;

 
 
(e)
Fifth, 75% to all Unitholders, Pro Rata, 23% to the holders of the Incentive
Distribution Rights, Pro Rata, and 2% to the General Partner, until there has
been distributed in respect of each Unit then Outstanding an amount equal to the
excess of the Third Target Distribution over the Second Target Distribution for
such Quarter; and

 
 
(f)
Thereafter, 50% to all Unitholders, Pro Rata, 48% to the holders of the
Incentive Distribution Rights, Pro Rata, and 2% to the General Partner;

 
provided, however, if the Minimum Quarterly Distribution, the First Target
Distribution, the Second Target Distribution and the Third Target Distribution
have been reduced to zero pursuant to the second sentence of Section 6.6(a), the
distribution of Available Cash that is deemed to be Operating Surplus with
respect to any Quarter will be made solely in accordance with Section 6.4(f).
 
SECTION 6.5        Distributions of Available Cash from Capital Surplus.
Available Cash that is deemed to be Capital Surplus pursuant to the provisions
of Section 6.3(a) shall be distributed, unless the provisions of Section 6.3
require otherwise, 98% to all Unitholders, Pro Rata, and 2% to the General
Partner, until a hypothetical holder of an Initial Common Unit has received with
respect to such Common Unit, during the period since the Closing Date through
such date, distributions of Available Cash that are deemed to be Capital Surplus
in an aggregate amount equal to the Initial Unit Capital Account. Available Cash
that is deemed to be Capital Surplus shall then be distributed 98% to all
Unitholders holding Common Units, Pro Rata, and 2% to the General Partner, until
there has been distributed in respect of each Common Unit then Outstanding an
amount equal to the Cumulative Common Unit Arrearage. Thereafter, all Available
Cash shall be distributed as if it were Operating Surplus and shall be
distributed in accordance with Section 6.4.
 
 
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SECTION 6.6         Adjustment of Minimum Quarterly Distribution and Target
Distribution Levels.
 
 
(a)
The Minimum Quarterly Distribution, First Target Distribution, Second Target
Distribution, Third Target Distribution, Common Unit Arrearages and Cumulative
Common Unit Arrearages shall be proportionately adjusted in the event of any
distribution, combination or subdivision (whether effected by a distribution
payable in Units or otherwise) of Units or other Partnership Interests in
connection with Section 5.9. In the event of a distribution of Available Cash
that is deemed to be from Capital Surplus, the then applicable Minimum Quarterly
Distribution, First Target Distribution, Second Target Distribution and Third
Target Distribution, shall be adjusted proportionately downward to equal the
product obtained by multiplying the otherwise applicable Minimum Quarterly
Distribution, First Target Distribution, Second Target Distribution and Third
Target Distribution, as the case may be, by a fraction of which the numerator is
the Unrecovered Capital of the Common Units immediately after giving effect to
such distribution and of which the denominator is the Unrecovered Capital of the
Common Units immediately prior to giving effect to such distribution.

 
 
(b)
The Minimum Quarterly Distribution, First Target Distribution, Second Target
Distribution and Third Target Distribution, shall also be subject to adjustment
pursuant to Section 6.8.

 
SECTION 6.7        Special Provisions Relating to the Holders of Incentive
Distribution Rights. Notwithstanding anything to the contrary set forth in this
Agreement, the holders of the Incentive Distribution Rights (a) shall (i)
possess the rights and obligations provided in this Agreement with respect to a
Limited Partner pursuant to Articles III and VII and (ii) have a Capital Account
as a Partner pursuant to Section 5.4 and all other provisions related thereto
and (b) shall not (i) be entitled to vote on any matters requiring the approval
or vote of the holders of Outstanding Units, (ii) be entitled to any
distributions other than as provided in Sections 6.4(a) and 12.4 or (iii) be
allocated items of income, gain, loss or deduction other than as specified in
this Article VI.
 
SECTION 6.8        Entity-Level Taxation. If legislation is enacted or the
interpretation of existing language is modified by the relevant governmental
authority which causes a Group Member to be treated as an association taxable as
a corporation or otherwise subjects a Group Member to entity-level taxation for
federal, state or local income tax purposes, the then applicable Minimum
Quarterly Distribution, First Target Distribution, Second Target Distribution
and Third Target Distribution, shall be adjusted to equal the product obtained
by multiplying (a) the amount thereof by (b) one minus the sum of (i) the
highest marginal federal corporate (or other entity, as applicable) income tax
rate of the Group Member for the taxable period of the Group Member in which
such Quarter occurs (expressed as a percentage) plus (ii) the effective overall
state and local income tax rate (expressed as a percentage) applicable to the
Group Member for the calendar year next preceding the calendar year in which
such Quarter occurs (after taking into account the benefit of any deduction
allowable for federal income tax purposes with respect to the payment of state
and local income taxes), but only to the extent of the increase in such rates
resulting from such legislation or interpretation. Such effective overall state
and local income tax rate shall be determined for the taxable period next
preceding the first taxable period during which the Group Member is taxable for
federal income tax purposes as an association taxable as a corporation or is
otherwise subject to entity-level taxation by determining such rate as if the
Group Member had been subject to such state and local taxes during such
preceding taxable period.
 
 
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ARTICLE VII
MANAGEMENT AND OPERATION OF BUSINESS
 
SECTION 7.1         Management.
 
 
(a)
The General Partner shall conduct, direct and manage all activities of the
Partnership. Except as otherwise expressly provided in this Agreement, all
management powers over the business and affairs of the Partnership shall be
exclusively vested in the General Partner, and no Limited Partner or Assignee
shall have any management power over the business and affairs of the
Partnership. In addition to the powers now or hereafter granted a general
partner of a limited partnership under applicable law or which are granted to
the General Partner under any other provision of this Agreement, the General
Partner, subject to Section 7.3, shall have full power and authority to do all
things and on such terms as it may deem necessary or appropriate to conduct the
business of the Partnership, to exercise all powers set forth in Section 2.5 and
to effectuate the purposes set forth in Section 2.4, including the following:

 
 
(i)
the making of any expenditures, the lending or borrowing of money, the
assumption or guarantee of, or other contracting for, indebtedness and other
liabilities, the issuance of evidences of indebtedness, including indebtedness
that is convertible into Partnership Interests, and the incurring of any other
obligations;

 
 
(ii)
the making of tax, regulatory and other filings, or rendering of periodic or
other reports to governmental or other agencies having jurisdiction over the
business or assets of the Partnership;

 
 
(iii)
the acquisition, disposition, mortgage, pledge, encumbrance, hypothecation or
exchange of any or all of the assets of the Partnership or the merger or other
combination of the Partnership with or into another Person (the matters
described in this clause (iii) being subject, however, to any prior approval
that may be required by Section 7.3 or Article XIV);

 
 
(iv)
the use of the assets of the Partnership (including cash on hand) for any
purpose consistent with the terms of this Agreement, including the financing of
the conduct of the operations of the Partnership Group; subject to Section 7.6,
the lending of funds to other Persons (including other Group Members); the
repayment or guarantee of obligations of the Partnership Group; and the making
of capital contributions to any member of the Partnership Group;

 
 
(v)
the negotiation, execution and performance of any contracts, conveyances or
other instruments (including instruments that limit the liability of the
Partnership under contractual arrangements to all or particular assets of the
Partnership, with the other party to the contract to have no recourse against
the General Partner or its assets other than its interest in the Partnership,
even if same results in the terms of the transaction being less favorable to the
Partnership than would otherwise be the case);

 
 
(vi)
the distribution of Partnership cash in accordance with Section 6.3;

 
 
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(vii)
the selection and dismissal of employees (including employees having titles such
as “president,” “vice president,” “secretary” and “treasurer”) and agents,
outside attorneys, accountants, consultants and contractors and the
determination of their compensation and other terms of employment or hiring;

 
 
(viii)
the maintenance of such insurance for the benefit of the Partnership Group, the
Partners and the Indemnitees as it deems necessary or appropriate;

 
 
(ix)
the formation of, or acquisition of an interest in, and the contribution of
property and the making of loans to, any other limited or general partnerships,
joint ventures, corporations, limited liability companies or other relationships
(including the acquisition of interests in, and the contributions of property
to, any Group Member from time to time) subject to the restrictions set forth in
Section 2.4;

 
 
(x)
the control of any matters affecting the rights and obligations of the
Partnership, including the bringing and defending of actions at law or in equity
and otherwise engaging in the conduct of litigation and the incurring of legal
expense and the settlement of claims and litigation;

 
 
(xi)
the indemnification of any Person against liabilities and contingencies to the
extent permitted by law;

 
 
(xii)
the entering into of listing agreements with any National Securities Exchange
and the delisting of some or all of the Limited Partner Interests from, or
requesting that trading be suspended on, any such exchange (subject to any prior
approval that may be required under Section 4.8);

 
 
(xiii)
unless restricted or prohibited by Section 5.5, the purchase, sale or other
acquisition or disposition of Partnership Interests;

 
 
(xiv)
the issuance of additional Partnership Interests and options, rights, warrants
and appreciation rights relating to Partnership Interests in accordance with
Section 5.5;

 
 
(xv)
the declaration of any split or combination of Partnership Interests so long as
the provisions of Section 5.7 are satisfied; and

 
 
(xvi)
the undertaking of any action in connection with the Partnership’s participation
in any Group Member.

 
 
(b)
Notwithstanding any other provision of this Agreement, the Delaware Act or any
applicable law, rule or regulation, each of the Partners, the Assignees and each
other Person who may acquire an interest in Partnership Interests hereby
(i) approves, ratifies and confirms the execution, delivery and performance by
the parties thereto of this Agreement; (ii) agrees that the General Partner (on
its own or through any officer of the Partnership) is authorized to execute,
deliver and perform the agreements referred to in clause (i) of this sentence
and the other agreements, acts, transactions and matters described in or
contemplated by the Registration Statement on behalf of the Partnership without
any further act, approval or vote of the Partners or the Assignees or the other
Persons who may acquire an interest in Partnership Interests; and (iii) agrees
that the execution, delivery or performance by the General Partner, any Group
Member or any Affiliate of any of them, of this Agreement or any agreement
authorized or permitted under this Agreement (including the exercise by the
General Partner or any Affiliate of the General Partner of the rights accorded
pursuant to Article XV), shall not constitute a breach by the General Partner of
any duty that the General Partner may owe the Partnership or the Limited
Partners or any other Persons under this Agreement (or any other agreements) or
of any duty stated or implied by law or equity.

 
 
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SECTION 7.2        Certificate of Limited Partnership. The General Partner has
caused the Certificate of Limited Partnership to be filed with the Secretary of
State of the State of Delaware as required by the Delaware Act. The General
Partner shall use all reasonable efforts to cause to be filed such other
certificates or documents as may be determined by the General Partner to be
reasonable and necessary or appropriate for the formation, continuation,
qualification and operation of a limited partnership (or a partnership in which
the limited partners have limited liability) in the State of Delaware or any
other state in which the Partnership may elect to do business or own property.
To the extent that such action is determined by the General Partner to be
reasonable and necessary or appropriate, the General Partner shall file
amendments to and restatements of the Certificate of Limited Partnership and do
all things to maintain the Partnership as a limited partnership (or a
partnership or other entity in which the limited partners have limited
liability) under the laws of the State of Delaware or of any other state in
which the Partnership may elect to do business or own property. Subject to the
terms of Section 3.4(a), the General Partner shall not be required, before or
after filing, to deliver or mail a copy of the Certificate of Limited
Partnership, any qualification document or any amendment thereto to any Limited
Partner.
 
SECTION 7.3        Restrictions on the General Partner’s Authority. Except as
provided in Articles XII and XIV, the General Partner may not sell, exchange or
otherwise dispose of all or substantially all of the Partnership’s assets in a
single transaction or a series of related transactions (including by way of
merger, consolidation or other combination) without the approval of holders of a
Unit Majority; provided, however, that this provision shall not preclude or
limit the General Partner’s ability to mortgage, pledge, hypothecate or grant a
security interest in all or substantially all of the assets of the Partnership
Group and shall not apply to any forced sale of any or all of the assets of the
Partnership Group pursuant to the foreclosure of, or other realization upon, any
such encumbrance.
 
SECTION 7.4         Reimbursement of the General Partner.
 
 
(a)
Except as provided in this Section 7.4 and elsewhere in this Agreement, the
General Partner shall not be compensated for its services as a general partner
or managing member of any Group Member.

 
 
(b)
The General Partner shall be reimbursed on a monthly basis, or such other
reasonable basis as the General Partner may determine to be appropriate for (i)
all direct and indirect expenses it incurs or payments it makes on behalf of the
Partnership Group (including salary, bonus, incentive compensation and other
amounts paid to any Person, including Affiliates of the General Partner, to
perform services for the Partnership or for the General Partner in the discharge
of its duties to the Partnership Group), and (ii) all other necessary or
appropriate expenses allocable to the Partnership Group or otherwise reasonably
incurred by the General Partner in connection with operating the Partnership’s
business (including expenses allocated to the General Partner by its
Affiliates). The General Partner shall determine the expenses that are allocable
to the General Partner or the Partnership Group in any reasonable manner
determined by the General Partner. Reimbursements pursuant to this Section 7.4
shall be in addition to any reimbursement to the General Partner as a result of
indemnification pursuant to Section 7.7.

 
 
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(c)
The General Partner, without the approval of the Limited Partners (who shall
have no right to vote in respect thereof), may propose and adopt on behalf of
the Partnership benefit plans, programs and practices (including plans, programs
and practices involving the issuance of Partnership Interests or options to or
rights, warrants or appreciation rights or phantom or tracking interest,
relating to Partnership Interests), or cause the Partnership to issue
Partnership Interests in connection with, or pursuant to, any benefit plan,
program or practice maintained or sponsored by the General Partner or any of its
Affiliates, in each case for the benefit of employees or directors of the
General Partner, any Group Member or any Affiliate, or any of them, in respect
of services performed, directly or indirectly, for the benefit of the
Partnership Group. The Partnership agrees to issue and sell to the General
Partner or any of its Affiliates any Partnership Interests that the General
Partner or such Affiliates are obligated to provide to any employees and
directors pursuant to any such benefit plans, programs or practices. Expenses
incurred by the General Partner in connection with any such plans, programs and
practices (including the net cost to the General Partner or such Affiliates of
Partnership Interests purchased by the General Partner or such Affiliates from
the Partnership to fulfill options or awards under such plans, programs and
practices) shall be reimbursed in accordance with Section 7.4(b). Any and all
obligations of the General Partner under any benefit plans, programs or
practices adopted by the General Partner as permitted by this Section 7.4(c)
shall constitute obligations of the General Partner hereunder and shall be
assumed by any successor General Partner approved pursuant to Section 11.1
or 11.2 or the transferee of or successor to all of the General Partner’s
General Partner Interest pursuant to Section 4.6.

 
SECTION 7.5         Outside Activities.
 
 
(a)
After the Closing Date, the General Partner, for so long as it is the General
Partner of the Partnership, (i) agrees that its sole business will be to act as
a general partner or managing member, as the case may be, of the Partnership and
any other partnership or limited liability company of which the Partnership is,
directly or indirectly, a partner or member and to undertake activities that are
ancillary or related thereto (including being a Limited Partner in the
Partnership); and (ii) shall not engage in any business or activity or incur any
debts or liabilities except in connection with or incidental to (A) its
performance as general partner or managing member, if any, of one or more Group
Members or as described in or contemplated by the Registration Statement,
(B) the acquiring, owning or disposing of debt securities or equity interests in
any Group Member or (C) the guarantee of, and mortgage, pledge, or encumbrance
of any or all of its assets in connection with, any indebtedness of any
Affiliate of the General Partner.

 
 
(b)
Each Unrestricted Person (other than the General Partner) shall have the right
to engage in businesses of every type and description and other activities for
profit and to engage in and possess an interest in other business ventures of
any and every type or description, whether in businesses engaged in or
anticipated to be engaged in by any Group Member, independently or with others,
including business interests and activities in direct competition with the
business and activities of any Group Member, and none of the same shall
constitute a breach of this Agreement or any duty express or implied by law to
any Group Member or any Partner or Assignee. Neither any Group Member, any
Limited Partner nor any other Person shall have any rights by virtue of this
Agreement, any Group Member Agreement or the partnership relationship
established hereby or thereby in any business ventures of any Unrestricted
Person.

 
 
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(c)
Notwithstanding anything to the contrary in this Agreement, (i) the engaging in
competitive activities by any Unrestricted Person (other than the General
Partner) in accordance with the provisions of this Section 7.5 is hereby
approved by the Partnership and all Partners, (ii) it shall be deemed not to be
a breach of the General Partner’s fiduciary duty or any other obligation of any
type whatsoever of the General Partner for any other Unrestricted Person for the
Unrestricted Person (other than the General Partner) to engage in such business
interests and activities in preference to or to the exclusion of the Partnership
and (iii) the Unrestricted Person shall have no obligation to present business
opportunities to the Partnership. Notwithstanding anything to the contrary in
this Agreement, the doctrine of corporate opportunity, or any analogous
doctrine, shall not apply to any Unrestricted Person (including the General
Partner). No Unrestricted Person (including the General Partner) who acquires
knowledge of a potential transaction, agreement, arrangement or other matter
that may be an opportunity for the Partnership, shall have any duty to
communicate or offer such opportunity to the Partnership, and such Unrestricted
Person (including the General Partner) shall not be liable to the Partnership,
to any Limited Partner or any other Person for breach of any fiduciary or other
duty by reason of the fact that such Unrestricted Person (including the General
Partner) pursues or acquires for itself, directs such opportunity to another
Person or does not communicate such opportunity or information to the
Partnership; provided, that such Unrestricted Person does not engage in such
business or activity as a result of or using confidential or proprietary
information provided by or on behalf of the Partnership to such Unrestricted
Person.

 
 
(d)
The General Partner and any of its Affiliates may acquire Units or other
Partnership Interests in addition to those acquired on the Closing Date and,
except as otherwise provided in this Agreement, shall be entitled to exercise
all rights of the General Partner or Limited Partner, as applicable, relating to
such Units or Partnership Interests.

 
 
(e)
The term “Affiliates” when used in Section 7.5(a) and Section 7.5(d) with
respect to the General Partner shall not include any Group Member or any
Subsidiary of the Group Member.

 
 
(f)
Anything in this Agreement to the contrary notwithstanding, to the extent that
provisions of this Agreement purport or are interpreted to have the effect of
restricting the fiduciary duties that might otherwise, as a result of Delaware
or other applicable law, be owed by the General Partner to the Partnership and
its Limited Partners, or to constitute a waiver or consent by the Limited
Partners to any such restriction, such provisions shall be deemed to have been
approved by the Partners and (ii) nothing in this Agreement shall limit or
otherwise affect any separate contractual obligations outside of this Agreement
of any Person (including any Unrestricted Person) to the Partnership or any of
its Affiliates.

 
SECTION 7.6         Loans from the General Partner; Loans or Contributions from
the Partnership; Contracts with Affiliates; Certain Restrictions on the General
Partner.
 
 
(a)
The General Partner or any of its Affiliates may, but shall be under no
obligation to, lend to any Group Member, and any Group Member may borrow from
the General Partner or any of its Affiliates, funds needed or desired by the
Group Member for such periods of time and in such amounts as the General Partner
may determine; provided, however, that such loans are in compliance with all
federal securities laws; and provided further, that in any such case the lending
party may not charge the borrowing party interest at a rate greater than the
rate that would be charged the borrowing party or impose terms less favorable to
the borrowing party than would be charged or imposed on the borrowing party by
unrelated lenders on comparable loans made on an arm’s-length basis (without
reference to the lending party’s financial abilities or guarantees). The
borrowing party shall reimburse the lending party for any costs (other than any
additional interest costs) incurred by the lending party in connection with the
borrowing of such funds. For purposes of this Section 7.6(a) and Section 7.6(b),
the term “Group Member” shall include any Affiliate of a Group Member that is
controlled by the Group Member. No Group Member may lend funds to the General
Partner or any of its Affiliates (other than another Group Member).

 
 
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(b)
The Partnership may lend or contribute to any Group Member, and any Group Member
may borrow from the Partnership, funds on terms and conditions established
solely by the General Partner; provided, however, that the Partnership may not
charge the Group Member interest at a rate less than the rate that would be
charged to the Group Member (without reference to the General Partner’s
financial abilities or guarantees) by unrelated lenders on comparable loans. The
foregoing authority shall be exercised by the General Partner and shall not
create any right or benefit in favor of any Group Member or any other Person.

 
 
(c)
The General Partner may itself, or may enter into an agreement with any of its
Affiliates to, render services to a Group Member or to the General Partner in
the discharge of its duties as General Partner of the Partnership. Any services
rendered to a Group Member by the General Partner or any of its Affiliates shall
be on terms that are fair and reasonable to the Partnership; provided, however,
that the requirements of this Section 7.6(c) shall be deemed satisfied as to
(i) any transaction approved by Special Approval, (ii) any transaction, the
terms of which are no less favorable to the Partnership Group than those
generally being provided to or available from unrelated third parties or
(iii) any transaction that, taking into account the totality of the
relationships between the parties involved (including other transactions that
may be particularly favorable or advantageous to the Partnership Group), is
equitable to the Partnership Group. The provisions of Section 7.4 shall apply to
the rendering of services described in this Section 7.6(c).

 
 
(d)
The Partnership Group may transfer assets to joint ventures, other partnerships,
corporations, limited liability companies or other business entities in which it
is or thereby becomes a participant upon such terms and subject to such
conditions as are consistent with this Agreement and applicable law.

 
 
(e)
Neither the General Partner nor any of its Affiliates shall sell, transfer or
convey any property to, or purchase any property from, the Partnership, directly
or indirectly, except pursuant to transactions that are fair and reasonable to
the Partnership; provided, however, that the requirements of this Section 7.6(e)
shall be deemed to be satisfied as to (i) the transactions effected pursuant to
Sections 5.2 and 5.3, the Contribution Agreement and any other transactions
described in or contemplated by the Registration Statement, (ii) any transaction
approved by Special Approval, (iii) any transaction, the terms of which are no
less favorable to the Partnership than those generally being provided to or
available from unrelated third parties, or (iv) any transaction that, taking
into account the totality of the relationships between the parties involved
(including other transactions that may be particularly favorable or advantageous
to the Partnership), is equitable to the Partnership. With respect to any
contribution of assets to the Partnership in exchange for Partnership Interests,
the Conflicts Committee, in determining whether the appropriate number of
Partnership Interests are being issued, may take into account, among other
things, the fair market value of the assets, the liquidated and contingent
liabilities assumed, the tax basis in the assets, the extent to which tax-only
allocations to the transferor will protect the existing partners of the
Partnership against a low tax basis, and such other factors as the Conflicts
Committee deems relevant under the circumstances.

 
 
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(f)
The General Partner and its Affiliates will have no obligation to permit any
Group Member to use any facilities or assets of the General Partner and its
Affiliates, except as may be provided in contracts entered into from time to
time specifically dealing with such use, nor shall there be any obligation on
the part of the General Partner or its Affiliates to enter into such contracts.

 
SECTION 7.7         Indemnification.
 
 
(a)
To the fullest extent permitted by law but subject to the limitations expressly
provided in this Agreement, all Indemnitees shall be indemnified and held
harmless by the Partnership from and against any and all losses, claims,
damages, liabilities, joint or several, expenses (including legal fees and
expenses), judgments, fines, penalties, interest, settlements or other amounts
arising from any and all claims, demands, actions, suits or proceedings, whether
civil, criminal, administrative or investigative, and whether formal or informal
and including appeals in which any Indemnitee may be involved, or is threatened
to be involved, as a party or otherwise, by reason of its status as an
Indemnitee and acting (or refraining to act) in such capacity on behalf of or
for the benefit of the Partnership; provided, that the Indemnitee shall not be
indemnified and held harmless pursuant to this Agreement if there has been a
final and non-appealable judgment entered by a court of competent jurisdiction
determining that, in respect of the matter for which the Indemnitee is seeking
indemnification pursuant to this Agreement, the Indemnitee acted in bad faith or
engaged in fraud, willful misconduct or, in the case of a criminal matter, acted
with knowledge that the Indemnitee’s conduct was unlawful; provided, further, no
indemnification pursuant to this Section 7.7 shall be available to the General
Partner or any Affiliate of the General Partner (other than a Group Member), or
to any Indemnity, with respect to its obligations incurred pursuant to the
Omnibus Agreement, the Contribution Agreement and the Distribution Agreement.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction or upon a plea of nolo contendere, or its equivalent,
shall not create a presumption that the Indemnitee acted in a manner contrary to
that specified above. Any indemnification pursuant to this Section 7.7 shall be
made only out of the assets of the Partnership, it being agreed that the General
Partner shall not be personally liable for such indemnification and shall have
no obligation to contribute or loan any monies or property to the Partnership to
enable it to effectuate such indemnification.

 
 
(b)
To the fullest extent permitted by law, expenses (including legal fees and
expenses) incurred by an Indemnitee who is indemnified pursuant to
Section 7.7(a) in defending any claim, demand, action, suit or proceeding shall,
from time to time, be advanced by the Partnership prior to a final and
non-applicable judgment entered by a court or competent jurisdiction determining
that, in respect of the matter for which the Indemnitee is seeking
indemnification pursuant to this Section 7.7, upon receipt by the Partnership of
any undertaking by or on behalf of the Indemnitee to repay such amount if it
shall ultimately be determined that the Indemnitee is not entitled to be
indemnified as authorized in this Section 7.7.

 
 
(c)
The indemnification provided by this Section 7.7 shall be in addition to any
other rights to which an Indemnitee may be entitled under any agreement,
pursuant to any vote of the holders of Outstanding Limited Partner Interests, as
a matter of law, in equity or otherwise, both as to actions in the Indemnitee’s
capacity as an Indemnitee and as to actions in any other capacity, and shall
continue as to an Indemnitee who has ceased to serve in such capacity and shall
inure to the benefit of the heirs, successors, assigns and administrators of the
Indemnitee.

 
 
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(d)
The Partnership may purchase and maintain (or reimburse the General Partner or
its Affiliates for the cost of) insurance, on behalf of the General Partner, its
Affiliates and such other Persons as the General Partner shall determine,
against any liability that may be asserted against or expense that may be
incurred by such Person in connection with the Partnership’s activities or such
Person’s activities on behalf of the Partnership, regardless of whether the
Partnership would have the power to indemnify such Person against such liability
under the provisions of this Agreement.

 
 
(e)
For purposes of this Section 7.7, the Partnership shall be deemed to have
requested an Indemnitee to serve as fiduciary of an employee benefit plan
whenever the performance by it of its duties to the Partnership also imposes
duties on, or otherwise involves services by, it to the plan or participants or
beneficiaries of the plan; excise taxes assessed on an Indemnitee with respect
to an employee benefit plan pursuant to applicable law shall constitute “fines;”
and action taken or omitted by it with respect to any employee benefit plan in
the performance of its duties for a purpose reasonably believed by it to be in
the interest of the participants and beneficiaries of the plan shall be deemed
to be for a purpose which is in, or not opposed to, the best interests of the
Partnership.

 
 
(f)
In no event may an Indemnitee subject the Limited Partners to personal liability
by reason of the indemnification provisions set forth in this Agreement.

 
 
(g)
An Indemnitee shall not be denied indemnification in whole or in part under this
Section 7.7 because the Indemnitee had an interest in the transaction with
respect to which the indemnification applies if the transaction was otherwise
permitted by the terms of this Agreement.

 
 
(h)
The provisions of this Section 7.7 are for the benefit of the Indemnitees, their
heirs, successors, assigns and administrators and shall not be deemed to create
any rights for the benefit of any other Persons.

 
 
(i)
No amendment, modification or repeal of this Section 7.7 or any provision hereof
shall in any manner terminate, reduce or impair the right of any past, present
or future Indemnitee to be indemnified by the Partnership, nor the obligations
of the Partnership to indemnify any such Indemnitee under and in accordance with
the provisions of this Section 7.7 as in effect immediately prior to such
amendment, modification or repeal with respect to claims arising from or
relating to matters occurring, in whole or in part, prior to such amendment,
modification or repeal, regardless of when such claims may arise or be asserted.

 
SECTION 7.8         Liability of Indemnitees.
 
 
(a)
Notwithstanding anything to the contrary set forth in this Agreement, no
Indemnitee shall be liable for monetary damages to the Partnership, the Limited
Partners, the Assignees or any other Persons who have acquired interests in the
Partnership Interests, for losses sustained or liabilities incurred as a result
of any act or omission of an Indemnitee unless there has been a final and
non-appealable judgment entered by a court of competent jurisdiction determining
that, in respect of the matter in question, the Indemnitee acted in bad faith or
engaged in fraud, willful misconduct or, in the case of a criminal matter, acted
with knowledge that the Indemnitee’s conduct was criminal.

 
 
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(b)
Subject to its obligations and duties as General Partner set forth in
Section 7.1(a), the General Partner may exercise any of the powers granted to it
by this Agreement and perform any of the duties imposed upon it hereunder either
directly or by or through its agents, and the General Partner shall not be
responsible for any misconduct or negligence on the part of any such agent
appointed by the General Partner in good faith.

 
 
(c)
To the extent that, at law or in equity, an Indemnitee has duties (including
fiduciary duties) and liabilities relating thereto to the Partnership or to the
Partners, the General Partner and any other Indemnitee acting in connection with
the Partnership’s business or affairs shall not be liable to the Partnership or
to any Partner for its good faith reliance on the provisions of this Agreement.

 
 
(d)
Any amendment, modification or repeal of this Section 7.8 or any provision
hereof shall be prospective only and shall not in any way affect the limitations
on the liability to the Indemnitees under this Section 7.8 as in effect
immediately prior to such amendment, modification or repeal with respect to
claims arising from or relating to matters occurring, in whole or in part, prior
to such amendment, modification or repeal, regardless of when such claims may
arise or be asserted.

 
SECTION 7.9         Resolution of Conflicts of Interest.
 
 
(a)
Unless otherwise expressly provided in this Agreement or any Group Member
Agreement, whenever a potential conflict of interest exists or arises between
the General Partner or any of its Affiliates, on the one hand, and the
Partnership, any Group Member or, any Partner or any Assignee, on the other, any
resolution or course of action by the General Partner or its Affiliates in
respect of such conflict of interest shall be permitted and deemed approved by
all Partners, and shall not constitute a breach of this Agreement, of any Group
Member Agreement, of any agreement contemplated herein or therein, or of any
duty stated or implied by law or equity, if the resolution or course of action
is, or by operation of this Agreement is (i) approved by Special Approval, (ii)
approved by a Unit Majority (excluding Outstanding Common Units held by the
General Partner or its Affiliates), (iii) on terms no less favorable to the
Partnership than those generally being provided to or available from unrelated
third parties, or (iv) fair and reasonable to the Partnership, taking into
account the totality of the relationships between the parties involved
(including other transactions that may be particularly favorable or advantageous
to the Partnership). The General Partner shall be authorized but not required in
connection with its resolution of such conflict of interest to seek Special
Approval or Limited Partner approval of such resolution, and the General Partner
may also adopt a resolution or course of action that has not received Special
Approval or Limited Partner approval.  If Special Approval is sought, then it
shall be presumed that, in making its decision, the Conflicts Committee acted on
an informed basis, in good faith, and in the honest belief that the action taken
was in the best interests of the Partnership, and if neither Special Approval
nor Limited Partner approval is sought and the Board of Directors of the General
Partner determines that the resolution or course of action taken with respect to
a conflict of interest satisfies either of the standards set forth in clauses
(iii) or (iv) above, then it shall be presumed that, in making its decision, the
Board of Directors acted in good faith, and in any proceeding brought by any
Limited Partner or by or on behalf of such Limited Partner or any other Limited
Partner or the Partnership challenging such approval, the Person bringing or
prosecuting such proceeding shall have the burden of overcoming such
presumption. Nothing contained in this Agreement, however, is intended to nor
shall it be construed to require the General Partner (including the Conflicts
Committee) to consider the interests of any Person other than the Partnership.
In the absence of bad faith by the General Partner, the resolution, action or
terms so made, taken or provided by the General Partner with respect to such
matter shall not constitute a breach of this Agreement or any other agreement
contemplated herein or a breach of any standard of care or duty imposed herein
or therein or, to the extent permitted by law, under the Delaware Act or any
other law, rule or regulation.

 
 
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(b)
Whenever the General Partner, or any committee of the Board of Directors
(including the Conflicts Committee), makes a determination or takes or declines
to take any other action, or any of its Affiliates causes the General Partner to
do so, in its capacity as the general partner of the Partnership as opposed to
in its individual capacity, whether under this Agreement, any Group Member
Agreement or any other agreement contemplated hereby or otherwise, then, unless
another express standard is provided for in this Agreement, the General Partner,
such committee or such Affiliate causing the General Partner to do so, shall
make such determination or take or decline to take such other action in good
faith and shall not be subject to any other or different standards (including
fiduciary standards) imposed by this Agreement, any Group Member Agreement, any
other agreement contemplated hereby or under the Delaware Act or any other law,
rule or regulation or at equity. In order for a determination or other action to
be in “good faith” for purposes of this Agreement, the Person or Persons making
such determination or taking or declining to take such other action must believe
that the determination for other action is in the best interests of the
Partnership.

 
 
(c)
Whenever the General Partner makes a determination or takes or declines to take
any other action, or any of its Affiliates causes it to do so, in its individual
capacity as opposed to in its capacity as the general partner of the
Partnership, whether under this Agreement, any Group Member Agreement or any
other agreement contemplated hereby or otherwise, then the General Partner, or
such Affiliates causing it to do so, are entitled, to the fullest extent
permitted by law, to make such determination or to take or decline to take such
other action free of any duty (including any fiduciary duty) or obligation
whatsoever to the Partnership, any Limited Partner, and any other Person bound
by this Agreement, and the General Partner, or such Affiliates causing it to do
so, shall not, to the fullest extent permitted by law, be required to act in
good faith or pursuant to any other standard imposed by this Agreement, any
Group Member Agreement, any other agreement contemplated hereby or under the
Delaware Act or any other law, rule or regulation or at equity. By way of
illustration and not of limitation, whenever the phrases, “at the option of the
General Partner,” “in its sole discretion” or some variation of those phrases,
are used in this Agreement, it indicates that the General Partner is acting in
its individual capacity. For the avoidance of doubt, whenever the General
Partner votes or transfers its Partnership Interests, or refrains from voting or
transferring its Partnership Interests, it shall be acting in its individual
capacity.

 
 
(d)
The General Partner’s organizational documents may provide that determinations
to take or decline to take any action in its individual, rather than
representative, capacity may or shall be determined by its members.

 
 
(e)
Notwithstanding anything to the contrary in this Agreement, the General Partner
and its Affiliates shall have no duty or obligation, express or implied, to (i)
sell or otherwise dispose of any asset of the Partnership Group other than in
the ordinary course of business or (ii) permit any Group Member to use any
facilities or assets of the General Partner and its Affiliates, except as may be
provided in contracts entered into from time to time specifically dealing with
such use. Any determination by the General Partner or any of its Affiliates to
enter into such contract shall be in its sole discretion.

 
 
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(f)
Except as expressly set forth in this Agreement or the Delaware Act, neither the
General Partner nor any other Indemnitee shall have any duties or liabilities,
including fiduciary duties, to the Partnership or any Limited Partner and the
provisions of this Agreement, to the extent that they restrict, eliminate or
otherwise modify the duties and liabilities, including fiduciary duties, of the
General Partner or any other Indemnitee otherwise existing at law or in equity,
are agreed by the Partners to replace such other duties and liabilities of the
General Partner or such other Indemnitee.

 
 
(g)
The Limited Partners hereby authorize the General Partner, on behalf of the
Partnership as a partner or member of a Group Member, to approve of actions by
the general partner or managing member of such Group Member similar to those
actions permitted to be taken by the General Partner pursuant to this
Section 7.9.

 
SECTION 7.10       Other Matters Concerning the General Partner.
 
 
(a)
The General Partner may rely and shall be protected in acting or refraining from
acting upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, consent, order, bond, debenture or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties.

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

 
 
(c)
The General Partner shall have the right, in respect of any of its powers or
obligations hereunder, to act through any of its duly authorized officers, a
duly appointed attorney or attorneys-in-fact or the duly authorized officers of
the Partnership.

 
 
(d)
Any standard of care and duty imposed by this Agreement or under the Delaware
Act or any applicable law, rule or regulation shall be modified, waived or
limited, to the extent permitted by law, as required to permit the General
Partner to act under this Agreement, and Group Member Agreement or any other
agreement contemplated by this Agreement and to make any decision pursuant to
the authority prescribed in this Agreement, so long as such action is reasonably
believed by the General Partner to be in, or not inconsistent with, the best
interests of the Partnership.

 
SECTION 7.11      Purchase or Sale of Partnership Interests. The General Partner
may cause the Partnership to purchase or otherwise acquire Partnership
Interests. As long as Partnership Interests are held by any Group Member, such
Partnership Interests shall not be considered Outstanding for any purpose,
except as otherwise provided herein. The General Partner or any Affiliate of the
General Partner may also purchase or otherwise acquire and sell or otherwise
dispose of Partnership Interests for its own account, subject to the provisions
of Articles IV and X.
 
SECTION 7.12      Registration Rights of the General Partner and its Affiliates.
The General Partner may grant to any Person that is a holder of Partnership
Interests the right to register Partnership Interests, including an Affiliate of
the General Partner, under the Securities Act in the event an exemption from the
registration requirements of the Securities Act (such as Rule 144 of the
Securities Act or any successor rule or regulation to Rule 144) is not available
to enable such holder of Partnership Interests to sell or transfer the number of
Partnership Interests it desires to so sell or transfer (for purposes of this
Section 7.12, the “Registration Rights”). The terms and conditions of the
Registration Rights, and the Persons to whom such Registration Rights may be
granted, shall be determined solely by the General Partner. No Limited Partner
or its Assignee shall have any rights with respect to the Persons to whom
Registration Rights are granted or the terms and conditions on which such
Registration Rights are granted.

 
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ARTICLE VIII
BOOKS, RECORDS, ACCOUNTING AND REPORTS
 
SECTION 8.1       Records and Accounting. The General Partner shall keep or
cause to be kept at the principal office of the Partnership appropriate books
and records with respect to the Partnership’s business, including all books and
records necessary to provide to the Limited Partners any information required to
be provided pursuant to Section 3.4(a). Any books and records maintained by or
on behalf of the Partnership in the regular course of its business, including
the record of the Record Holders and Assignees of Units or other Partnership
Interests, books of account and records of Partnership proceedings, may be kept
on, or be in the form of, computer disks, hard drives, punch cards, magnetic
tape, photographs, micrographics or any other information storage device;
provided, that the books and records so maintained are convertible into clearly
legible written form within a reasonable period of time. The books of the
Partnership shall be maintained, for financial reporting purposes, on an accrual
basis in accordance with U.S. GAAP. The Partnership shall not be required to
keep books maintained on a cash basis and the General Partner shall be permitted
to calculate cash-based measures, including Operating Surplus and Adjusted
Operating Surplus, by making such adjustments to its accrual basis books to
account for non-cash items and other adjustments as the General Partner
determines to be necessary or appropriate.
 
SECTION 8.2         Fiscal Year. The fiscal year of the Partnership shall be a
fiscal year ending December 31.
 
SECTION 8.3        Reports.
 
 
(a)
As soon as practicable, but in no event later than 120 days after the close of
each fiscal year of the Partnership, the General Partner shall cause to be made
available, by a reasonable means, to each Record Holder of a Unit as of a date
selected by the General Partner in its discretion, an annual report on Form 10-K
containing financial statements of the Partnership for such fiscal year of the
Partnership, presented in accordance with U.S. GAAP, including a balance sheet
and statements of operations, Partnership equity and cash flows, such statements
to be audited by a firm of independent public accountants selected by the
General Partner.

 
 
(b)
As soon as practicable, but in no event later than 90 days after the close of
each Quarter except the last Quarter of each fiscal year, the General Partner
shall cause to be made available, by any reasonable means, to each Record Holder
of a Unit, as of a date selected by the General Partner in its discretion, a
quarterly report on Form 10-Q containing unaudited financial statements of the
Partnership and such other information as may be required by applicable law,
regulation or rule of any National Securities Exchange on which the Units are
listed for trading, or as the General Partner determines to be necessary or
appropriate.

 
 
(c)
The General Partner shall be deemed to have made a report available to each
Record Holder as required by this Section 8.3 if it has either (i) filed such
report with the SEC via its Electronic Data Gathering, Analysis and Retrieval
system and such report is publicly available on such system or (ii) made such
report available on any publicly available website maintained by the
Partnership.

 
 
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ARTICLE IX
TAX MATTERS
 
SECTION 9.1        Tax Returns and Information. The Partnership shall timely
file all returns of the Partnership that are required for federal, state and
local income tax purposes on the basis of the accrual method and the taxable
period or years that it is required by law to adopt, from time to time, as
determined by the General Partner. In the event the Partnership is required to
use a taxable period other than a year ending on December 31, the General
Partner shall use reasonable efforts to change the taxable period of the
Partnership to a year ending on December 31. The tax information reasonably
required by Record Holders for federal and state income tax reporting purposes
with respect to a taxable year shall be furnished to them within 90 days of the
close of the calendar year in which the Partnership’s taxable year ends. The
classification, realization and recognition of income, gain, losses and
deductions and other items shall be on the accrual method of accounting for
federal income tax purposes.
 
SECTION 9.2        Tax Elections.
 
 
(a)
The Partnership shall make the election under Section 754 of the Code in
accordance with applicable regulations thereunder, subject to the reservation of
the right to seek to revoke any such election upon the General Partner’s
determination that such revocation is in the best interests of the Limited
Partners. Notwithstanding any other provision herein contained, for the purposes
of computing the adjustments under Section 743(b) of the Code, the General
Partner shall be authorized (but not required) to adopt a convention whereby the
price paid by a transferee of a Limited Partner Interest will be deemed to be
the lowest quoted closing price of the Limited Partner Interests on any National
Securities Exchange on which such Limited Partner Interests are traded during
the calendar month in which such transfer is deemed to occur pursuant to
Section 6.2(i) without regard to the actual price paid by such transferee.

 
 
(b)
Except as otherwise provided herein, the General Partner shall determine whether
the Partnership should make any other elections permitted by the Code.

 
SECTION 9.3       Tax Controversies. Subject to the provisions hereof, the
General Partner is designated as the Tax Matters Partner (as defined in the
Code) and is authorized and required to represent the Partnership (at the
Partnership’s expense) in connection with all examinations of the Partnership’s
affairs by tax authorities, including resulting administrative and judicial
proceedings, and to expend Partnership funds for professional services and costs
associated therewith. Each Partner agrees to cooperate with the General Partner
and to do or refrain from doing any or all things reasonably required by the
General Partner to conduct such proceedings.
 
SECTION 9.4        Withholding; Tax Payments.
 
 
(a)
The General Partner may treat taxes paid by the Partnership on behalf of all or
less than all of the Partners, either as a distribution of cash to such Partners
or as a general expense of the Partnership, as determined appropriate under the
circumstances by the General Partner.

 
 
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(b)
Notwithstanding any other provision of this Agreement, the General Partner is
authorized to take any action that it determines in its discretion to be
necessary or appropriate to cause the Partnership and other Group Members to
comply with any withholding requirements established under the Code or any other
federal, state or local law including, without limitation, pursuant to Sections
1441, 1442, 1445 and 1446 of the Code. To the extent that the Partnership is
required or elects to withhold and pay over to any taxing authority any amount
resulting from the allocation or distribution of income to any Partner or
Assignee (including, without limitation, by reason of Section 1446 of the Code),
the amount withheld may at the discretion of the General Partner be treated by
the Partnership as a distribution of cash pursuant to Section 6.3 in the amount
of such withholding from such Partner.

 
ARTICLE X
ADMISSION OF PARTNERS
 
SECTION 10.1      Admission of Limited Partners.
 
 
(a)
Effective upon the Distribution, the General Partner shall admit such parties to
the Partnership as Initial Limited Partners in respect of the Initial Common
Units distributed to them in the Distribution. Each such Initial Limited
Partner, by virtue of receiving Initial Common Units in the Distribution, agrees
to be bound by, and acknowledges and agrees to all of the terms of, this
Agreement without the need to execute this Agreement.

 
 
(b)
By acceptance of the transfer of any Limited Partner Interests in accordance
with Article IV or the acceptance of any Limited Partner Interests issued
pursuant to Article V or pursuant to a merger or consolidation or conversion
pursuant to Article XIV, and except as provided in Section 4.9, each transferee
of, or other such Person, acquiring, a Limited Partner Interest (including any
Substituted Limited Partner, nominee holder or an agent or representative
acquiring such Limited Partner Interests for the account of another Person)
shall be admitted to the Partnership as a Limited Partner with respect to the
Limited Partner Interests so transferred or issued to such Person when (i) such
Person has paid the requisite consideration for the Limited Partner Interests,
(ii) any such transfer or admission is reflected in the books and records of the
Partnership and such Limited Partner becomes the Record Holder of the Limited
Partner Interests so transferred, (iii) such Person shall become bound, and
shall be deemed to have agreed to be bound, by the terms of this Agreement,
(iv) such Person represents that the transferee or other recipient has the
capacity, power and authority to enter into this Agreement and (v) such Person
makes the consents, acknowledgements and waivers contained in this Agreement,
all with or without execution of this Agreement by such Person. The transfer of
any Limited Partner Interests and the admission of any new Limited Partner shall
not constitute an amendment to this Agreement. A Person may become a Limited
Partner or Record Holder of a Limited Partner Interest without the consent or
approval of any of the Partners. A Person may not become a Limited Partner
without acquiring a Limited Partner Interest and until such Person is reflected
in the books and records of the Partnership as the Record Holder of such Limited
Partner Interest. The rights and obligations of a Person who is an Ineligible
Holder shall be determined in accordance with Section 4.9.

 
 
(c)
The name and mailing address of each Limited Partner shall be listed on the
books and records of the Partnership maintained for such purpose by the
Partnership or the Transfer Agent. The General Partner shall update the books
and records of the Partnership from time to time as necessary to reflect
accurately the information therein (or shall cause the Transfer Agent to do so,
as applicable).

 
 
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SECTION 10.2     Admission of Substituted Limited Partner. By transfer of a
Limited Partner Interest in accordance with Article IV, the transferor shall be
deemed to have given the transferee the right to seek admission as a Substituted
Limited Partner subject to the conditions of, and in the manner permitted under,
this Agreement. A transferor of a Certificate representing a Limited Partner
Interest or of uncertificated Limited Partner Interests shall, however, only
have the authority to convey to a purchaser or other transferee who does not
execute and deliver a Transfer Application (a) the right to negotiate such
Certificate or uncertificated Limited Partner Interests to a purchaser or other
transferee and (b) the right to transfer the right to request admission as a
Substituted Limited Partner to such purchaser or other transferee in respect of
the transferred Limited Partner Interests. Each transferee of a Limited Partner
Interest (including any nominee holder or an agent acquiring such Limited
Partner Interest for the account of another Person) who executes and delivers a
Transfer Application shall, by virtue of such execution and delivery, be an
Assignee and be deemed to have applied to become a Substituted Limited Partner
with respect to the Limited Partner Interests so transferred to such Person.
Such Assignee shall become a Substituted Limited Partner (x) at such time as the
General Partner consents thereto, which consent may be given or withheld in the
General Partner’s discretion, and (y) when any such admission is shown on the
books and records of the Partnership. If such consent is withheld, such
transferee shall be an Assignee. An Assignee shall have an interest in the
Partnership equivalent to that of a Limited Partner with respect to allocations
and distributions, including liquidating distributions, of the Partnership. With
respect to voting rights attributable to Limited Partner Interests that are held
by Assignees, the General Partner shall be deemed to be the Limited Partner with
respect thereto and shall, in exercising the voting rights in respect of such
Limited Partner Interests on any matter, vote such Limited Partner Interests at
the written direction of the Assignee who is the Record Holder of such Limited
Partner Interests. If no such written direction is received, such Limited
Partner Interests will not be voted. An Assignee shall have no other rights of a
Limited Partner.
 
SECTION 10.3      Admission of Successor General Partner. A successor General
Partner approved pursuant to Section 11.1 or 11.2 or the transferee of or
successor to all of the General Partner Interest pursuant to Section 4.6 who is
proposed to be admitted as a successor General Partner shall be admitted to the
Partnership as the General Partner, effective immediately prior to the
withdrawal or removal of the predecessor or transferring General Partner,
pursuant to Section 11.1 or 11.2 or the transfer of the General Partner Interest
pursuant to Section 4.6; provided, however, that no such successor shall be
admitted to the Partnership until compliance with the terms of Section 4.6 has
occurred and such successor has executed and delivered such other documents or
instruments as may be required to effect such admission. Any such successor
shall, subject to the terms hereof, carry on the business of the members of the
Partnership Group without dissolution.
 
SECTION 10.4      Amendment of Agreement and Certificate of Limited Partnership.
To effect the admission to the Partnership of any Partner, the General Partner
shall take all steps necessary and appropriate under the Delaware Act to amend
the records of the Partnership to reflect such admission and, if necessary, to
prepare as soon as practicable an amendment to this Agreement and, if required
by law, the General Partner shall prepare and file an amendment to the
Certificate of Limited Partnership, and the General Partner may for this
purpose, among others, exercise the power of attorney granted pursuant to
Section 2.6.
 
ARTICLE XI
WITHDRAWAL OR REMOVAL OF PARTNERS
 
SECTION 11.1      Withdrawal of the General Partner.
 
 
(a)
The General Partner shall be deemed to have withdrawn from the Partnership upon
the occurrence of any one of the following events (each such event herein
referred to as an “Event of Withdrawal”):

 
 
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(i)
The General Partner voluntarily withdraws from the Partnership by giving written
notice to the other Partners;

 
 
(ii)
The General Partner transfers all of its rights as General Partner pursuant to
Section 4.6;

 
 
(iii)
The General Partner is removed pursuant to Section 11.2;

 
 
(iv)
The General Partner (A) makes a general assignment for the benefit of creditors;
(B) files a voluntary bankruptcy petition for relief under Chapter 7 of the
United States Bankruptcy Code; (C) files a petition or answer seeking for itself
a liquidation, dissolution or similar relief (but not a reorganization) under
any law; (D) files an answer or other pleading admitting or failing to contest
the material allegations of a petition filed against the General Partner in a
proceeding of the type described in clauses (A)-(C) of this Section 11.1(a)(iv);
or (E) seeks, consents to or acquiesces in the appointment of a trustee (but not
a debtor-in-possession), receiver or liquidator of the General Partner or of all
or any substantial part of its properties;

 
 
(v)
A final and non-appealable order of relief under Chapter 7 of the United States
Bankruptcy Code is entered by a court with appropriate jurisdiction pursuant to
a voluntary or involuntary petition by or against the General Partner; or

 
 
(vi)
(A) in the event the General Partner is a corporation, a certificate of
dissolution or its equivalent is filed for the General Partner, or 90 days
expire after the date of notice to the General Partner of revocation of its
charter without a reinstatement of its charter, under the laws of its state of
incorporation; (B) in the event the General Partner is a partnership or a
limited liability company, the dissolution and commencement of winding up of the
General Partner; (C) in the event the General Partner is acting in such capacity
by virtue of being a trustee of a trust, the termination of the trust; (D) in
the event the General Partner is a natural person, his death or adjudication of
incompetency; and (E) otherwise in the event of the termination of the General
Partner.

 
If an Event of Withdrawal specified in Section 11.1(a)(iv), (v) or (vi)(A), (B),
(C) or (E) occurs, the withdrawing General Partner shall give notice to the
Limited Partners within 30 days after such occurrence. The Partners hereby agree
that only the Events of Withdrawal described in this Section 11.1 shall result
in the withdrawal of the General Partner from the Partnership.

 
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(b)
Withdrawal of the General Partner from the Partnership upon the occurrence of an
Event of Withdrawal shall not constitute a breach of this Agreement under the
following circumstances: (i) the General Partner voluntarily withdraws by giving
at least 90 days’ advance notice to the Unitholders, such withdrawal to take
effect on the date specified in such notice; provided that prior to the
effective date of such withdrawal, the withdrawal is approved by Unitholders
holding at least a majority of the Outstanding Common Units (excluding Common
Units held by the General Partner and its Affiliates) and the General Partner
delivers to the Partnership an Opinion of Counsel (“Withdrawal Opinion of
Counsel”) that such withdrawal (following the selection of the successor General
Partner) would not result in the loss of the limited liability of any Limited
Partner or any Group Member or cause any Group Member to be treated as an
association taxable as a corporation or otherwise to be taxed as an entity for
federal income tax purposes (to the extent not previously treated as such);
(ii) at any time that the General Partner ceases to be the General Partner
pursuant to Section 11.1(a)(i) or is removed pursuant to Section 11.2; or
(iii) notwithstanding clause (i) of this sentence, at any time that the General
Partner voluntarily withdraws by giving at least 90 days’ advance notice of its
intention to withdraw to the Limited Partners, such withdrawal to take effect on
the date specified in the notice, if at the time such notice is given one Person
and its Affiliates (other than the General Partner and its Affiliates) own
beneficially or of record or control at least 50% of the Outstanding Units. The
withdrawal of the General Partner from the Partnership upon the occurrence of an
Event of Withdrawal shall also constitute the withdrawal of the General Partner
as general partner or managing member, to the extent applicable, of the other
Group Members. If the General Partner gives a notice of withdrawal pursuant to
Section 11.1(a)(i), the holders of a Unit Majority, may, prior to the effective
date of such withdrawal, elect a successor General Partner. The Person so
elected as successor General Partner shall automatically become the successor
general partner or managing member, to the extent applicable, of the other Group
Members of which the General Partner is a general partner or a managing member.
If, prior to the effective date of the General Partner’s withdrawal, a successor
is not selected by the Unitholders as provided herein or the Partnership does
not receive a Withdrawal Opinion of Counsel, the Partnership shall be dissolved
in accordance with Section 12.1. Any successor General Partner elected in
accordance with the terms of this Section 11.1 shall be subject to the
provisions of Section 10.3.

 
SECTION 11.2      Removal of the General Partner. The General Partner may be
removed if such removal is approved by the Unitholders holding at least 80% of
the Outstanding Units (including Units held by the General Partner and its
Affiliates) voting as a single class. Any such action by such holders for
removal of the General Partner must also provide for the election of a successor
General Partner by the Unitholders holding a majority of the outstanding Common
Units voting as a class (including Units held by the General Partner and its
Affiliates). Such removal shall be effective immediately following the admission
of a successor General Partner pursuant to Section 10.3. The removal of the
General Partner shall also automatically constitute the removal of the General
Partner as general partner or managing member, to the extent applicable, of the
other Group Members of which the General Partner is a general partner or a
managing member. If a Person is elected as a successor General Partner in
accordance with the terms of this Section 11.2, such Person shall, upon
admission pursuant to Section 10.3, automatically become a successor general
partner or managing member, to the extent applicable, of the other Group Members
of which the General Partner is a general partner or a managing member. The
right of the holders of Outstanding Units to remove the General Partner shall
not exist or be exercised unless the Partnership has received an opinion opining
as to the matters covered by a Withdrawal Opinion of Counsel. Any successor
General Partner elected in accordance with the terms of this Section 11.2 shall
be subject to the provisions of Section 10.3. The percentage of the Outstanding
Units required to remove the General Partner may be amended by the General
Partner as described in Section 13.1 hereof.
 
SECTION 11.3      Interest of Departing General Partner and Successor General
Partner.

 
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(a)
In the event of (i) withdrawal of the General Partner under circumstances where
such withdrawal does not violate this Agreement or (ii) removal of the General
Partner by the holders of Outstanding Units under circumstances where Cause does
not exist, if the successor General Partner is elected in accordance with the
terms of Section 11.1 or 11.2, the Departing General Partner shall have the
option, exercisable prior to the effective date of the withdrawal or removal of
such Departing General Partner, to require its successor to purchase its General
Partner Interest and its Affiliates or beneficial owners general partner
interest (or equivalent interest) if any, in the other Group Members and all of
its or its Affiliates Incentive Distribution Rights (collectively, the “Combined
Interest”) in exchange for an amount in cash equal to the fair market value of
such Combined Interest, such amount to be determined and payable as of the
effective date of its withdrawal or removal. If the General Partner is removed
by the Unitholders under circumstances where Cause exists or if the General
Partner withdraws under circumstances where such withdrawal violates this
Agreement, and if a successor General Partner is elected in accordance with the
terms of Section 11.1 or 11.2 (or if the business is continued pursuant to
Section 12.2 and a successor General Partner is not the former General Partner),
such successor shall have the option, exercisable prior to the effective date of
the departure of such Departing General Partner (or, in the event the business
of the Partnership is continued, prior to the date the business of the
Partnership is continued), to purchase the Combined Interest for such fair
market value of such Combined Interest of the Departing General Partner. In
either event, the Departing General Partner shall be entitled to receive all
reimbursements due such Departing General Partner pursuant to Section 7.4,
including any employee-related liabilities (including severance liabilities),
incurred in connection with the termination of any employees employed by the
Departing General Partner for the benefit of the Partnership or the other Group
Members.

 
For purposes of this Section 11.3(a), the fair market value of the Departing
Partner’s Combined Interest shall be determined by agreement between the
Departing General Partner and its successor or, failing agreement within 30 days
after the effective date of such Departing General Partner’s departure, by an
independent investment banking firm or other independent expert selected by the
Departing General Partner and its successor, which, in turn, may rely on other
experts, and the determination of which shall be conclusive as to such matter.
If such parties cannot agree upon one independent investment banking firm or
other independent expert within 45 days after the effective date of such
departure, then the Departing General Partner shall designate an independent
investment banking firm or other independent expert, the Departing General
Partner’s successor shall designate an independent investment banking firm or
other independent expert, and such firms or experts shall mutually select a
third independent investment banking firm or independent expert, which third
independent investment banking firm or other independent expert shall determine
the fair market value of the Combined Interest of the Departing General Partner.
In making its determination, such third independent investment banking firm or
other independent expert may consider the then current trading price of Units on
any National Securities Exchange on which Units are then listed, the value of
the Partnership’s assets, the rights and obligations of the Departing General
Partner and other factors it may deem relevant.
 
 
(b)
If the Combined Interest is not purchased in the manner set forth in
Section 11.3(a), the Departing General Partner (or its transferee) shall become
a Limited Partner and its General Partner Interest shall be converted into
Common Units pursuant to a valuation made by an investment banking firm or other
independent expert selected pursuant to Section 11.3(a), without reduction in
such Partnership Interest (but subject to proportionate dilution by reason of
the admission of its successor) and its Incentive Distribution Rights shall
continue in full force and effect. Any successor General Partner shall indemnify
the Departing General Partner (or its transferee) as to all debts and
liabilities of the Partnership arising on or after the date on which the
Departing General Partner (or its transferee) becomes a Limited Partner. For
purposes of this Agreement, conversion of the General Partner Interest of the
Departing General Partner to Common Units will be characterized as if the
Departing General Partner (or its transferee) contributed its General Partner
Interest to the Partnership in exchange for the newly issued Common Units.

 
 
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(c)
If a successor General Partner is elected in accordance with the terms of
Section 11.1 or 11.2 and the option described in Section 11.3(a) is not
exercised by the party entitled to do so, the successor General Partner shall,
at the effective date of its admission to the Partnership, contribute to the
Partnership cash in the amount equal to 2/98ths of the Net Agreed Value of the
Partnership’s assets on such date. In such event, such successor General Partner
shall, subject to the following sentence, be entitled to 2% of all Partnership
allocations and distributions to which the Departing General Partner was
entitled. In addition, the successor General Partner shall cause this Agreement
to be amended to reflect that, from and after the date of such successor General
Partner’s admission, the successor General Partner’s interest in all Partnership
distributions and allocations shall be 2%.

 
SECTION 11.4     Withdrawal of Limited Partners. No Limited Partner shall have
any right to withdraw from the Partnership; provided, however, that when a
transferee of a Limited Partner’s Limited Partner Interest becomes a Record
Holder of the Limited Partner Interest so transferred, such transferring Limited
Partner shall cease to be a Limited Partner with respect to the Limited Partner
Interest so transferred.
 
ARTICLE XII
DISSOLUTION AND LIQUIDATION
 
SECTION 12.1     Dissolution. The Partnership shall not be dissolved by the
admission of Substituted Limited Partners or additional Limited Partners or by
the admission of a successor General Partner in accordance with the terms of
this Agreement. Upon the removal or withdrawal of the General Partner, if a
successor General Partner is elected pursuant to Section 11.1 or 11.2, the
Partnership shall not be dissolved and such successor General Partner shall
continue the business of the Partnership. The Partnership shall dissolve, and
(subject to Section 12.2) its affairs shall be wound up, upon:
 
 
(a)
an Event of Withdrawal of the General Partner as provided in Section 11.1(a)
(other than Section 11.1(a)(ii)), unless a successor is elected and an Opinion
of Counsel is received as provided in Section 11.1(b) or 11.2 and such successor
is admitted to the Partnership pursuant to Section 10.3;

 
 
(b)
an election to dissolve the Partnership by the General Partner that is approved
by the holders of a Unit Majority;

 
 
(c)
the entry of a decree of judicial dissolution of the Partnership pursuant to the
provisions of the Delaware Act; or

 
 
(d)
the distribution to the Partners of all proceeds from the sale of all or
substantially all of the assets and properties of the Partnership Group such
that the Partnership Group no longer holds any assets.

 
SECTION 12.2      Continuation of the Business of the Partnership After
Dissolution. Upon (a) dissolution of the Partnership following an Event of
Withdrawal caused by the withdrawal or removal of the General Partner as
provided in Section 11.1(a)(i) or (iii) and the failure of the Partners to
select a successor to such Departing General Partner pursuant to Section 11.1
or 11.2, then within 90 days thereafter, or (b) dissolution of the Partnership
upon an event constituting an Event of Withdrawal as defined in
Section 11.1(a)(iv), (v) or (vi), then, to the maximum extent permitted by law,
within 180 days thereafter, the holders of a Unit Majority may elect to
reconstitute the Partnership and continue its business on the same terms and
conditions set forth in this Agreement by forming a new limited partnership on
terms identical to those set forth in this Agreement and having as the successor
General Partner a Person approved by the holders of a Unit Majority. Unless such
an election is made within the applicable time period as set forth above, the
Partnership shall conduct only activities necessary to wind up its affairs. If
such an election is so made, then:
 
 
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(i)
the reconstituted Partnership shall continue unless earlier dissolved in
accordance with this Article XII;

 
 
(ii)
if the successor General Partner is not the former General Partner, then the
interest of the former General Partner shall be treated in the manner provided
in Section 11.3; and

 
 
(iii)
all necessary steps shall be taken to cancel this Agreement and the Certificate
of Limited Partnership and to enter into and, as necessary, to file a new
partnership agreement and certificate of limited partnership, and the successor
General Partner may for this purpose exercise the powers of attorney granted the
General Partner pursuant to Section 2.6; provided, that the right of the holders
of a Unit Majority to approve a successor General Partner and to reconstitute
and to continue the business of the Partnership shall not exist and may not be
exercised unless the Partnership has received an Opinion of Counsel that (x) the
exercise of the right would not result in the loss of limited liability of any
Limited Partner and (y) neither the Partnership, the reconstituted limited
partnership nor any Group Member would be treated as an association taxable as a
corporation or otherwise be taxable as an entity for federal income tax purposes
upon the exercise of such right to continue.

 
SECTION 12.3      Liquidator. Upon dissolution of the Partnership, unless the
Partnership is continued under an election to reconstitute and continue the
Partnership pursuant to Section 12.2, the General Partner shall select one or
more Persons to act as Liquidator, which may be the General Partner. The
Liquidator (if other than the General Partner) shall be entitled to receive such
compensation for its services as may be approved by holders of at least a
majority of the Outstanding Common Units. The Liquidator (if other than the
General Partner) shall agree not to resign at any time without 15 days’ prior
notice and may be removed at any time, with or without cause, by notice of
removal approved by holders of at least a majority of the Outstanding Common
Units. Upon dissolution, removal or resignation of the Liquidator, a successor
and substitute Liquidator (who shall have and succeed to all rights, powers and
duties of the original Liquidator) shall within 30 days thereafter be approved
by holders of at least a majority of the Outstanding Common Units. The right to
approve a successor or substitute Liquidator in the manner provided herein shall
be deemed to refer also to any such successor or substitute Liquidator approved
in the manner herein provided. Except as expressly provided in this Article XII,
the Liquidator approved in the manner provided herein shall have and may
exercise, without further authorization or consent of any of the parties hereto,
all of the powers conferred upon the General Partner under the terms of this
Agreement (but subject to all of the applicable limitations, contractual and
otherwise, upon the exercise of such powers, other than the limitation on sale
set forth in Section 7.3(b)) to the extent necessary or desirable in the good
faith judgment of the Liquidator to carry out the duties and functions of the
Liquidator hereunder for and during such period of time as shall be reasonably
required in the good faith judgment of the Liquidator to complete the winding up
and liquidation of the Partnership as provided for herein.
 
SECTION 12.4      Liquidation. The Liquidator shall proceed to dispose of the
assets of the Partnership, discharge its liabilities, and otherwise wind up its
affairs in such manner and over such period as the Liquidator determines to be
in the best interest of the Partners, subject to Section 17-804 of the Delaware
Act, and the following:
 
 
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(a)
The assets may be disposed of by public or private sale or by distribution in
kind to one or more Partners on such terms as the Liquidator and such Partner or
Partners may agree. If any property is distributed in kind, the Partner
receiving the property shall be deemed for purposes of Section 12.4(c) to have
received cash equal to its fair market value; and contemporaneously therewith,
appropriate cash distributions must be made to the other Partners. The
Liquidator may, in its absolute discretion, defer liquidation or distribution of
the Partnership’s assets for a reasonable time if it determines that an
immediate sale or distribution of all or some of the Partnership’s assets would
be impractical or would cause undue loss to the Partners. The Liquidator may, in
its absolute discretion, distribute the Partnership’s assets, in whole or in
part, in kind if it determines that a sale would be impractical or would cause
undue loss to the Partners.

 
 
(b)
Liabilities of the Partnership include amounts owed to the Liquidator as
compensation for serving in such capacity (subject to the terms of Section 12.3)
and amounts to Partners otherwise than in respect of their distribution rights
under Article VI. With respect to any liability that is contingent, conditional
or unmatured or is otherwise not yet due and payable, the Liquidator shall
either settle such claim for such amount as it thinks appropriate or establish a
reserve of cash or other assets to provide for its payment. When paid, any
unused portion of the reserve shall be distributed as additional liquidation
proceeds.

 
 
(c)
All property and all cash in excess of that required to discharge liabilities as
provided in Section 12.4(b) shall be distributed to the Partners in accordance
with, and to the extent of, the positive balances in their respective Capital
Accounts, as determined after taking into account all Capital Account
adjustments (other than those made by reason of distributions pursuant to this
Section 12.4(c)) for the taxable year of the Partnership during which the
liquidation of the Partnership occurs (with such date of occurrence being
determined pursuant to Treasury Regulation Section 1.704-1(b)(2)(ii)(g)), and
such distribution shall be made by the end of such taxable period (or, if later,
within 90 days after said date of such occurrence).

 
SECTION 12.5      Cancellation of Certificate of Limited Partnership. Upon the
completion of the distribution of Partnership cash and property as provided in
Section 12.4 in connection with the liquidation of the Partnership, the
Partnership shall be terminated and the Certificate of Limited Partnership and
all qualifications of the Partnership as a foreign limited partnership in
jurisdictions other than the State of Delaware shall be canceled and such other
actions as may be necessary to terminate the Partnership shall be taken.
 
SECTION 12.6      Return of Contributions. The General Partner shall not be
personally liable for, and shall have no obligation to contribute or loan any
monies or property to the Partnership to enable it to effectuate, the return of
the Capital Contributions of the Limited Partners or Unitholders, or any portion
thereof, it being expressly understood that any such return shall be made solely
from Partnership assets.
 
SECTION 12.7      Waiver of Partition. To the maximum extent permitted by law,
each Partner hereby waives any right to partition of the Partnership property.
 
SECTION 12.8      Capital Account Restoration. No Limited Partner shall have any
obligation to restore any negative balance in its Capital Account upon
liquidation of the Partnership. The General Partner shall be obligated to
restore any negative balance in its Capital Account upon liquidation of its
interest in the Partnership by the end of the taxable period of the Partnership
during which such liquidation occurs, or, if later, within 90 days after the
date of such liquidation.
 
 
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ARTICLE XIII
AMENDMENT OF PARTNERSHIP AGREEMENT; MEETINGS; RECORD DATE
 
SECTION 13.1      Amendments to be Adopted Solely by the General Partner. Each
Partner agrees that the General Partner, without the approval of any Partner or
Assignee, may amend any provision of this Agreement and execute, swear to,
acknowledge, deliver, file and record whatever documents may be required in
connection therewith, to reflect:
 
 
(a)
a change in the name of the Partnership, the location of the principal place of
business of the Partnership, the registered agent of the Partnership or the
registered office of the Partnership;

 
 
(b)
admission, substitution, withdrawal or removal of Partners in accordance with
this Agreement;

 
 
(c)
a change that the General Partner determines to be necessary or advisable to
qualify or continue the qualification of the Partnership as a limited
partnership or a partnership in which the Limited Partners have limited
liability under the laws of any state or to ensure that the Group Members will
not be treated as associations taxable as corporations or otherwise taxed as
entities for federal income tax purposes;

 
 
(d)
a change that the General Partner determines (i) does not adversely affect the
Limited Partners (including any particular class of Partnership Interests as
compared to other classes of Partnership Interests) in any material respect,
(ii) to be necessary or advisable to (A) satisfy any requirements, conditions or
guidelines contained in any opinion, directive, order, ruling or regulation of
any federal or state agency or judicial authority or contained in any federal or
state statute (including the Delaware Act) or (B) facilitate the trading of the
Units (including the division of any class or classes of Outstanding Units into
different classes to facilitate uniformity of tax consequences within such
classes of Units) or comply with any rule, regulation, guideline or requirement
of any National Securities Exchange on which the Units are or will be listed or
admitted to trading, compliance with any of which the General Partner determines
in its discretion to be in the best interests of the Partnership and the Limited
Partners, (iii) is necessary or advisable in connection with action taken by the
General Partner pursuant to Section 5.7, (iv) is required to effect the intent
expressed in the Registration Statement or the intent of the provisions of this
Agreement or is otherwise contemplated by this Agreement or (v) is required to
conform to proposed or promulgated Treasury Regulations under Subchapter K of
the Code regarding compensatory and noncompensatory options to acquire a
Partnership Interest;

 
 
(e)
a change in the fiscal year or taxable period of the Partnership and any changes
that, in the discretion of the General Partner, are necessary or advisable as a
result of a change in the fiscal year or taxable period of the Partnership
including, if the General Partner shall so determine, a change in the definition
of “Quarter” and the dates on which distributions are to be made by the
Partnership;

 
 
(f)
an amendment that is necessary, in the Opinion of Counsel, to prevent the
Partnership, or the General Partner or its directors, officers, trustees or
agents from in any manner being subjected to the provisions of the Investment
Company Act of 1940, as amended, the Investment Advisers Act of 1940, as
amended, or “plan asset” regulations adopted under the Employee Retirement
Income Security Act of 1974, as amended, regardless of whether such are
substantially similar to plan asset regulations currently applied or proposed by
the United States Department of Labor;

 
 
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(g)
subject to the terms of Section 5.5(d), an amendment that the General Partner
determines to be necessary or advisable in connection with the authorization of
issuance of any class or series of Partnership Interests pursuant to
Section 5.5;

 
 
(h)
any amendment expressly permitted in this Agreement to be made by the General
Partner acting alone;

 
 
(i)
an amendment effected, necessitated or contemplated by a Merger Agreement or
Plan of Conversion approved in accordance with Section 14.4;

 
 
(j)
an amendment that the General Partner determines to be necessary or advisable to
reflect, account for and deal with appropriately the formation by the
Partnership of, or investment by the Partnership in, any corporation,
partnership, joint venture, limited liability company or other entity, in
connection with the conduct by the Partnership of activities permitted by the
terms of Section 2.4 or Section 7.1(a);

 
 
(k)
a merger or conveyance pursuant to Section 14.3(d);

 
 
(l)
an amendment to Section 11.2 that would reduce the percentage of the Outstanding
Units required for the Unitholders to remove the General Partner; provided,
however, that once such required percentage has been reduced, it may be further
reduced by the General Partner but such required percentage may not be increased
without a vote of the Unitholders; provided further, however, that no such
amendment may provide that any class of Partnership Interests may vote
separately as a class to remove the General Partner;

 
 
(m)
an amendment to the definition of “Outstanding” contained in Section 1.1 hereof
to increase from 20% or more the percentage of Outstanding Partnership
Interests, that if at any time acquired by any Person or Group, shall not be
voted on any matter and shall not be considered to be Outstanding for the other
purposes described in such definition; provided, however, that once such
percentage has been increased, it may be further increased by the General
Partner, but such required percentage may not be reduced without a vote of the
Unitholders; or

 
 
(n)
any other amendments substantially similar to the foregoing.

 
SECTION 13.2     Amendment Procedures. Except as provided in Sections 13.1
and 13.3, all amendments to this Agreement shall be made in accordance with the
following requirements. Amendments to this Agreement may be proposed only by or
with the consent of the General Partner which consent may be given or withheld
in its sole discretion. A proposed amendment shall be effective upon its
approval by the holders of a Unit Majority, unless a greater or different
percentage is required under this Agreement or by Delaware law. Each proposed
amendment that requires the approval of the holders of a specified percentage of
Outstanding Units shall be set forth in a writing that contains the text of the
proposed amendment. If such an amendment is proposed, the General Partner shall
seek the written approval of the requisite percentage of Outstanding Units or
call a meeting of the Unitholders to consider and vote on such proposed
amendment. The General Partner shall notify all Record Holders upon final
adoption of any such proposed amendments. The General Partner shall be deemed to
have notified all Record Holders as required by this Section 13.2 if it has
either (i) filed such amendment with the SEC via its Electronic Data Gathering,
Analysis and Retrieval system and such amendment is publicly available on such
system or (ii) made such amendment available on any publicly available website
maintained by the Partnership.
 
 
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SECTION 13.3      Amendment Requirements.
 
 
(a)
Notwithstanding the provisions of Sections 13.1 and 13.2, no provision of this
Agreement that establishes a percentage of Outstanding Units (including Units
deemed owned by the General Partner) required to take any action shall be
amended, altered, changed, repealed or rescinded in any respect that would have
the effect of (i) in the case of any provision of this Agreement other than
Section 11.2 or Section 13.4, reducing such voting percentage or (ii) in the
case of Section 11.2 or Section 13.4, increasing such percentage, unless such
amendment is approved by the written consent or the affirmative vote of holders
of Outstanding Units whose aggregate Outstanding Units constitute not less than
the voting requirement sought to be reduced or increased, as applicable.

 
 
(b)
Notwithstanding the provisions of Sections 13.1 and 13.2, no amendment to this
Agreement may (i) enlarge the obligations of any Limited Partner without its
consent, unless such shall be deemed to have occurred as a result of an
amendment approved pursuant to Section 13.3(c), (ii) enlarge the obligations of,
restrict in any way any action by or rights of, or reduce in any way the amounts
distributable, reimbursable or otherwise payable to, the General Partner or any
of its Affiliates without its consent, which consent may be given or withheld in
its sole discretion, (iii) change Section 12.1(b), or (iv) change the term of
the Partnership or, except as set forth in Section 12.1(b), give any Person the
right to dissolve the Partnership.

 
 
(c)
Except as provided in Section 14.3, and without limitation of the General
Partner’s authority to adopt amendments to this Agreement without the approval
of any Partners or Assignees as contemplated in Section 13.1, any amendment that
would have a material adverse effect on the rights or preferences of any class
of Partnership Interests in relation to other classes of Partnership Interests
must be approved by the holders of not less than a majority of the Outstanding
Partnership Interests of the class affected.

 
 
(d)
Notwithstanding any other provision of this Agreement, except for amendments
pursuant to Section 13.1 and except as otherwise provided by Section 14.3(b), no
amendments shall become effective without the approval of the holders of at
least 90% of the Outstanding Units voting as a single class unless the
Partnership obtains an Opinion of Counsel to the effect that such amendment will
not affect the limited liability of any Limited Partner under applicable law.

 
 
(e)
Except as provided in Section 13.1, this Section 13.3 shall only be amended with
the approval of the holders of at least 90% of the Outstanding Units.

 
SECTION 13.4     Special Meetings. All acts of Limited Partners to be taken
pursuant to this Agreement shall be taken in the manner provided in this Article
XIII. Special meetings of the Limited Partners may be called by the General
Partner or by Limited Partners owning 20% or more of the Outstanding Units of
the class or classes for which a meeting is proposed. Limited Partners shall
call a special meeting by delivering to the General Partner one or more requests
in writing stating that the signing Limited Partners wish to call a special
meeting and indicating the general or specific purposes for which the special
meeting is to be called. Within 60 days after receipt of such a call from
Limited Partners or within such greater time as may be reasonably necessary for
the Partnership to comply with any statutes, rules, regulations, listing
agreements or similar requirements governing the holding of a meeting or the
solicitation of proxies for use at such a meeting, the General Partner shall
send a notice of the meeting to the Limited Partners either directly or
indirectly through the Transfer Agent. A meeting shall be held at a time and
place determined by the General Partner on a date not less than 10 days nor more
than 60 days after the mailing of notice of the meeting. Limited Partners shall
not vote on matters that would cause the Limited Partners to be deemed to be
taking part in the management and control of the business and affairs of the
Partnership so as to jeopardize the Limited Partners’ limited liability under
the Delaware Act or the law of any other state in which the Partnership is
qualified to do business.
 
 
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SECTION 13.5      Notice of a Meeting. Notice of a meeting called pursuant to
Section 13.4 shall be given to the Record Holders of the class or classes of
Units for which a meeting is proposed in writing by mail or other means of
written communication in accordance with Section 16.1. The notice shall be
deemed to have been given at the time when deposited in the mail or sent by
other means of written communication.
 
SECTION 13.6      Record Date. For purposes of determining the Limited Partners
entitled to notice of or to vote at a meeting of the Limited Partners or to give
approvals without a meeting as provided in Section 13.11, the General Partner
will set a Record Date, which shall not be less than 10 nor more than 60 days
before (a) the date of the meeting (unless such requirement conflicts with any
rule, regulation, guideline or requirement of any National Securities Exchange
on which the Units are listed or admitted to trading, or U.S. federal securities
laws, in which case the rule, regulation, guideline or requirement of such
National Securities Exchange or U.S. federal securities law shall govern) or (b)
in the event that approvals are sought without a meeting, the date by which
Limited Partners are requested in writing by the General Partner to give such
approvals.
 
SECTION 13.7      Adjournment. When a meeting is adjourned to another time or
place, notice need not be given of the adjourned meeting and a new Record Date
need not be fixed, if the time and place thereof are announced at the meeting at
which the adjournment is taken, unless such adjournment shall be for more than
45 days. At the adjourned meeting, the Partnership may transact any business
which might have been transacted at the original meeting. If the adjournment is
for more than 45 days or if a new Record Date is fixed for the adjourned
meeting, a notice of the adjourned meeting shall be given in accordance with
this Article XIII.
 
SECTION 13.8      Waiver of Notice; Approval of Meeting; Approval of Minutes.
The transactions of any meeting of Limited Partners, however called and noticed,
and whenever held, shall be as valid as if it had occurred at a meeting duly
held after regular call and notice, if a quorum is present either in person or
by proxy, and if, either before or after the meeting, Limited Partners
representing such quorum who were present in person or by proxy and entitled to
vote, sign a written waiver of notice or an approval of the holding of the
meeting or an approval of the minutes thereof. All waivers and approvals shall
be filed with the Partnership records or made a part of the minutes of the
meeting. Attendance of a Limited Partner at a meeting shall constitute a waiver
of notice of the meeting, except when the Limited Partner does not approve, at
the beginning of the meeting, of the transaction of any business because the
meeting is not lawfully called or convened; and except that attendance at a
meeting is not a waiver of any right to disapprove the consideration of matters
required to be included in the notice of the meeting, but not so included, if
the disapproval is expressly made at the meeting.
 
 
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SECTION 13.9      Quorum. The holders of a majority of the Outstanding Units of
the class or classes for which a meeting has been called (including Outstanding
Units deemed owned by the General Partner) represented in person or by proxy
shall constitute a quorum at a meeting of Limited Partners of such class or
classes unless any such action by the Limited Partners requires approval by
holders of a greater percentage of such Units, in which case the quorum shall be
such greater percentage. At any meeting of the Limited Partners duly called and
held in accordance with this Agreement at which a quorum is present, the act of
Limited Partners holding Outstanding Units that in the aggregate represent a
majority of the Outstanding Units entitled to vote and be present in person or
by proxy at such meeting shall be deemed to constitute the act of all Limited
Partners, unless a greater or different percentage is required with respect to
such action under the provisions of this Agreement, in which case the act of the
Limited Partners holding Outstanding Units that in the aggregate represent at
least such greater or different percentage shall be required. The Limited
Partners present at a duly called or held meeting at which a quorum is present
may continue to transact business until adjournment, notwithstanding the
withdrawal of enough Limited Partners to leave less than a quorum, if any action
taken (other than adjournment) is approved by the required percentage of
Outstanding Units specified in this Agreement (including Outstanding Units
deemed owned by the General Partner). In the absence of a quorum any meeting of
Limited Partners may be adjourned from time to time by the affirmative vote of
holders of at least a majority of the Outstanding Units entitled to vote at such
meeting (including Outstanding Units deemed owned by the General Partner)
represented either in person or by proxy, but no other business may be
transacted, except as provided in Section 13.7.
 
SECTION 13.10    Conduct of a Meeting. The General Partner shall have full power
and authority concerning the manner of conducting any meeting of the Limited
Partners or solicitation of approvals in writing, including the determination of
Persons entitled to vote, the existence of a quorum, the satisfaction of the
requirements of Section 13.4, the conduct of voting, the validity and effect of
any proxies and the determination of any controversies, votes or challenges
arising in connection with or during the meeting or voting. The General Partner
shall designate a Person to serve as chairman of any meeting and shall further
designate a Person to take the minutes of any meeting. All minutes shall be kept
with the records of the Partnership maintained by the General Partner. The
General Partner may make such other regulations consistent with applicable law
and this Agreement as it may deem advisable concerning the conduct of any
meeting of the Limited Partners or solicitation of approvals in writing,
including regulations in regard to the appointment of proxies, the appointment
and duties of inspectors of votes and approvals, the submission and examination
of proxies and other evidence of the right to vote, and the revocation of
approvals in writing.
 
SECTION 13.11    Action Without a Meeting. If authorized by the General Partner,
any action that may be taken at a meeting of the Limited Partners may be taken
without a meeting if an approval in writing setting forth the action so taken is
signed by Limited Partners owning not less than the minimum percentage of the
Outstanding Units (including Units deemed owned by the General Partner) that
would be necessary to authorize or take such action at a meeting at which all
the Limited Partners were present and voted (unless such provision conflicts
with any rule, regulation, guideline or requirement of any National Securities
Exchange on which the Units are listed or admitted to trading, in which case the
rule, regulation, guideline or requirement of such exchange shall govern).
Prompt notice of the taking of action without a meeting shall be given to the
Limited Partners who have not approved in writing. The General Partner may
specify that any written ballot submitted to Limited Partners for the purpose of
taking any action without a meeting shall be returned to the Partnership within
the time period, which shall be not less than 20 days, specified by the General
Partner. If a ballot returned to the Partnership does not vote all of the Units
held by the Limited Partners, the Partnership shall be deemed to have failed to
receive a ballot for the Units that were not voted. If approval of the taking of
any action by the Limited Partners is solicited by any Person other than by or
on behalf of the General Partner, the written approvals shall have no force and
effect unless and until (a) they are deposited with the Partnership in care of
the General Partner, (b) approvals sufficient to take the action proposed are
dated as of a date not more than 90 days prior to the date sufficient approvals
are deposited with the Partnership and (c) an Opinion of Counsel is delivered to
the General Partner to the effect that the exercise of such right and the action
proposed to be taken with respect to any particular matter (i) will not cause
the Limited Partners to be deemed to be taking part in the management and
control of the business and affairs of the Partnership so as to jeopardize the
Limited Partners’ limited liability, and (ii) is otherwise permissible under the
state statutes then governing the rights, duties and liabilities of the
Partnership and the Partners. Nothing contained in this Section 13.11 shall be
deemed to require the General Partner to solicit all Limited Partners in
connection with a matter approved by the holders of the requisite percentage of
Units acting by written consent without a meeting.
 
 
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SECTION 13.12    Voting and Other Rights.
 
 
(a)
Only those Record Holders of the outstanding Units on the Record Date set
pursuant to Section 13.6 (and also subject to the limitations contained in the
definition of “Outstanding”) shall be entitled to notice of, and to vote at, a
meeting of Limited Partners or to act with respect to matters as to which the
holders of the Outstanding Units have the right to vote or to act. All
references in this Agreement to votes of, or other acts that may be taken by,
the Outstanding Units shall be deemed to be references to the votes or acts of
the Record Holders of such Outstanding Units.

 
 
(b)
With respect to Units that are held for a Person’s account by another Person
(such as a broker, dealer, bank, trust company or clearing corporation, or an
agent of any of the foregoing), in whose name such Units are registered, such
other Person shall, in exercising the voting rights in respect of such Units on
any matter, and unless the arrangement between such Persons provides otherwise,
vote such Units in favor of, and at the direction of, the Person who is the
beneficial owner, and the Partnership shall be entitled to assume it is so
acting without further inquiry. The provisions of this Section 13.12(b) (as well
as all other provisions of this Agreement) are subject to the provisions of
Section 4.3.

 
ARTICLE XIV
MERGER, CONSOLIDATION OR CONVERSION
 
SECTION 14.1      Authority. The Partnership may merge or consolidate with or
into one or more corporations, limited liability companies, business trusts or
associations, real estate investment trusts, common law trusts or unincorporated
businesses, including a partnership (whether general or limited (including a
limited liability partnership)) or convert into any such entity, whether such
entity is formed under the laws of the State of Delaware or of any state of the
United States of America, pursuant to a written agreement of merger or
consolidation (“Merger Agreement”) or a written plan of conversion (“Plan of
Conversion”), as the case may be, in accordance with this Article XIV.
 
SECTION 14.2      Procedure for Merger, Consolidation or Conversion.
 
 
(a)
Merger, consolidation or conversion of the Partnership pursuant to this Article
XIV requires the prior approval of the General Partner; provided, however, that,
to the fullest extent permitted by law, the General Partner shall have no duty
or obligation to consent to any merger, consolidation or conversion of the
Partnership and may decline to do so free of any fiduciary duty or obligation
whatsoever to the Partnership, any Limited Partner and, in declining to consent
to a merger, consolidation or conversion, shall not be required to act in good
faith or pursuant to any other standard imposed by this Agreement, any other
agreement contemplated hereby or under the Delaware Act or any other law, rule
or regulation or at equity.

 
 
(b)
If the General Partner shall determine, in the exercise of its discretion, to
consent to the merger or consolidation, the General Partner shall approve the
Merger Agreement, which shall set forth:

 
 
(i)
the names and jurisdictions of formation or organization of each of the business
entities proposing to merge or consolidate;

 
 
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(ii)
the name and jurisdiction of formation or organization of the business entity
that is to survive the proposed merger or consolidation (the “Surviving Business
Entity”);

 

 
(iii) 
the terms and conditions of the proposed merger or consolidation;

 
 
(iv)
the manner and basis of exchanging or converting the equity securities of each
constituent business entity for, or into, cash, property or general or limited
partner interests, rights, securities or obligations of the Surviving Business
Entity; and (i) if any interests, securities or rights of any constituent
business entity are not to be exchanged or converted solely for, or into, cash,
property or interests, rights, securities or obligations of the Surviving
Business Entity, then the cash, property or interests, rights, securities or
obligations of any general or limited partnership, corporation, trust, limited
liability company, unincorporated business or other entity (other than the
Surviving Business Entity) which the holders of such interests, securities or
rights are to receive in exchange for, or upon conversion of their interests,
securities or rights, and (ii) in the case of equity interests represented by
certificates, upon the surrender of such certificates, which cash, property or
interests, rights, securities or obligations of the Surviving Business Entity or
any general or limited partnership, corporation, trust, limited liability
company, unincorporated business or other entity (other than the Surviving
Business Entity), or evidences thereof, are to be delivered;

 
 
(v)
a statement of any changes in the constituent documents or the adoption of new
constituent documents (the articles or certificate of incorporation, articles of
trust, declaration of trust, certificate or agreement of limited partnership,
certificate of formation or limited liability company agreement or other similar
charter or governing document) of the Surviving Business Entity to be effected
by such merger or consolidation;

 
 
(vi)
the effective time of the merger, which may be the date of the filing of the
certificate of merger pursuant to Section 14.4 or a later date specified in or
determinable in accordance with the Merger Agreement (provided, that if the
effective time of the merger is to be later than the date of the filing of the
certificate of merger, the effective time shall be fixed no later than the time
of the filing of the certificate of merger and stated therein); and

 
 
(vii)
such other provisions with respect to the proposed merger or consolidation as
are deemed necessary or appropriate by the General Partner.

 
 
(c)
If the General Partner shall determine to consent to the conversion, the General
Partner shall approve the Plan of Conversion, which shall set forth:

 
 
(i)
the name of the converting entity and the converted entity;

 
 
(ii)
a statement that the Partnership is continuing its existence in the
organizational form of the converted entity;

 
 
(iii)
a statement as to the type of entity that the converted entity is to be and the
state or country under the laws of which the converted entity is to be
incorporated, formed or organized;

 
 
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(iv)
the manner and basis of exchanging or converting the equity securities of each
constituent business entity for, or into, cash, property or interests, rights,
securities or obligations of the converted entity or another entity, or for the
cancellation of such equity securities;

 
 
(v)
in an attachment or exhibit, the certificate of limited partnership of the
Partnership; and

 
 
(vi)
in an attachment or exhibit, the certificate of limited partnership, articles of
incorporation, or other organizational documents of the converted entity;

 
 
(vii)
the effective time of the conversion, which may be the date of the filing of the
articles of conversion or a later date specified in or determinable in
accordance with the Plan of Conversion (provided, that if the effective time of
the conversion is to be later than the date of the filing of such articles of
conversion, the effective time shall be fixed at a date or time certain and
stated in such articles of conversion); and

 
 
(viii)
such other provisions with respect to the proposed conversion that the General
Partner determines to be necessary or appropriate.

 
SECTION 14.3     Approval by Limited Partners of Merger, Consolidation or
Conversion.
 
 
(a)
Except as provided in Section 14.3(d), the General Partner, upon its approval of
the Merger Agreement or the Plan of Conversion, as the case may be, shall direct
that the Merger Agreement or the Plan of Conversion and the merger,
consolidation or conversion contemplated thereby, as applicable, be submitted to
a vote of Limited Partners, whether at a special meeting or by written consent,
in either case in accordance with the requirements of Article XIII. A copy or a
summary of the Merger Agreement or Plan of Conversion shall be included in or
enclosed with the notice of a special meeting or the written consent.

 
 
(b)
Except as provided in Section 14.3(d), the Merger Agreement, or the Plan of
Conversion, as the case may be, shall be approved upon receiving the affirmative
vote or consent of the holders of a Unit Majority unless the Merger Agreement,
or the Plan of Conversion, as the case may be, contains any provision that, if
contained in an amendment to this Agreement, the provisions of this Agreement or
the Delaware Act would require for its approval the vote or consent of a greater
percentage of the Outstanding Units or of any class of Limited Partners, in
which case such greater percentage vote or consent shall be required for
approval of the Merger Agreement or the Plan of Conversion, as the case may be.

 
 
(c)
Except as provided in Section 14.3(d), after such approval by vote or consent of
the Limited Partners, and at any time prior to the filing of the certificate of
merger or certificate of conversion pursuant to Section 14.4, the merger,
consolidation or conversion may be abandoned pursuant to provisions therefor, if
any, set forth in the Merger Agreement or Plan of Conversion, as the case may
be.

 
 
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(d)
Notwithstanding anything else contained in this Article XIV or in this
Agreement, the General Partner is permitted without Limited Partner approval, to
merge or consolidate the Partnership or any Group Member with or into, or convey
all of the Partnership’s assets to, another limited liability entity which shall
be newly formed and shall have no assets, liabilities or operations at the time
of such merger, consolidation or conversion other than those it receives from
the Partnership or other Group Member if (i) the General Partner has received an
Opinion of Counsel that the merger, conversion or conveyance, as the case may
be, would not result in the loss of the limited liability of any Limited Partner
or any Group Member or cause the Partnership or any Group Member to be treated
as an association taxable as a corporation or otherwise to be taxed as an entity
for federal income tax purposes (to the extent not previously treated as such),
(ii) the sole purpose of such merger, conversion or conveyance is to effect a
mere change in the legal form of the Partnership into another limited liability
entity and (iii) the governing instruments of the new entity provide the Limited
Partners and the General Partner with the same rights and obligations as are
herein contained.

 
 
(f)
Pursuant to Section 17-211(g) of the Delaware Act, an agreement of merger or
consolidation approved in accordance with this Article XIV may (a) effect any
amendment to this Agreement or (b) effect the adoption of a new partnership
agreement for the Partnership if it is the Surviving Business Entity. Any such
amendment or adoption made pursuant to this Section 14.3 shall be effective at
the effective time or date of the merger or consolidation.

 
SECTION 14.4      Certificate of Merger. Upon the required approval by the
General Partner and the Unitholders of a Merger Agreement or the Plan of
Conversion, as the case may be, a certificate of merger or certificate of
conversion, as applicable, shall be executed and filed with the Secretary of
State of the State of Delaware in conformity with the requirements of the
Delaware Act.
 
SECTION 14.5      Effect of Merger, Consolidation or Conversion.
 
 
(a)
At the effective time of the certificate of merger:

 
 
(i)
all of the rights, privileges and powers of each of the business entities that
has merged or consolidated, and all property, real, personal and mixed, and all
debts due to any of those business entities and all other things and causes of
action belonging to each of those business entities, shall be vested in the
Surviving Business Entity and after the merger or consolidation shall be the
property of the Surviving Business Entity to the extent they were of each
constituent business entity;

 
 
(ii)
the title to any real property vested by deed or otherwise in any of those
constituent business entities shall not revert and is not in any way impaired
because of the merger or consolidation;

 
 
(iii)
all rights of creditors and all liens on or security interests in property of
any of those constituent business entities shall be preserved unimpaired; and

 
 
(iv)
all debts, liabilities and duties of those constituent business entities shall
attach to the Surviving Business Entity and may be enforced against it to the
same extent as if the debts, liabilities and duties had been incurred or
contracted by it.

 
 
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(b)
At the effective time of the certificate of conversion, for all purposes of the
laws of the State of Delaware:

 
 
(i)
the Partnership shall continue to exist, without interruption, but in the
organizational form of the converted entity rather than in its prior
organizational form;

 
 
(ii)
all rights, title, and interests to all real estate and other property owned by
the Partnership shall remain vested in the converted entity in its new
organizational form without reversion or impairment, without further act or
deed, and without any transfer or assignment having occurred, but subject to any
existing liens or other encumbrances thereon;

 
 
(iii)
all liabilities and obligations of the Partnership shall continue to be
liabilities and obligations of the converted entity in its new organizational
form without impairment or diminution by reason of the conversion;

 
 
(iv)
all rights of creditors or other parties with respect to or against the prior
interest holders or other owners of the Partnership in their capacities as such
in existence as of the effective time of the conversion will continue in
existence as to those liabilities and obligations and are enforceable against
the converted entity by such creditors and obligees to the same extent as if the
liabilities and obligations had originally been incurred or contracted by the
converted entity;

 
 
(v)
the Partnership Interests that are to be converted into partnership interests,
shares, evidences of ownership, or other rights or securities in the converted
entity or cash as provided in the plan of conversion shall be so converted, and
Partners shall be entitled only to the rights provided in the Plan of
Conversion.

 
 
(c)
A merger, consolidation or conversion effected pursuant to this Article shall
not be deemed to result in a transfer or assignment of assets or liabilities
from one entity to another.

 
ARTICLE XV
RIGHT TO ACQUIRE LIMITED PARTNER INTERESTS
 
Section 15.1          Right to Acquire Limited Partner Interests.
 
 
(a)
Notwithstanding any other provision of this Agreement, if at any time the
General Partner and its Affiliates hold more than 80% of the total Limited
Partner Interests of any class then Outstanding, the General Partner shall then
have the right, which right it may assign and transfer in whole or in part to
the Partnership or any Affiliate of the General Partner to purchase all, but not
less than all, of such Limited Partner Interests of such class then Outstanding
held by Persons other than the General Partner and its Affiliates:

 
 
(i)
If the Limited Partner Interests are listed or admitted to trading on a National
Securities Exchange, the purchase price for such Limited Partner Interests shall
be the greater of (x) the Current Market Price as of the date three days prior
to the date that the notice described in Section 15.1(b) is mailed and (y) the
highest price paid by the General Partner or any of its Affiliates for any such
Limited Partner Interests of such class purchased during the 90-day period
immediately preceding the date that the notice described in Section 15.1(b) is
mailed.

 
 
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(ii)
If the Limited Partner Interests are an unregistered class of securities for
which there is not a public market, the purchase price for such Limited Partner
Interests shall be an amount determined by an independent investment banking
firm or other independent expert selected by the General Partner, which
investment bank may, in turn, rely on other experts, and the determination of
which shall be conclusive as to such matter. No Limited Partner will have any
appraisal rights or dissenters’ rights with respect to the price established for
such Limited Partner Interests as provided in this Section 15.1(a)(ii).

 
 
(b)
If the General Partner, any Affiliate of the General Partner or the Partnership
elects to exercise the right to purchase Limited Partner Interests granted
pursuant to Section 15.1(a), then the General Partner shall:

 
 
(i)
In the case of a class of Limited Partner Interests that is listed or admitted
to trading on a National Securities Exchange, deliver to the Transfer Agent
notice of such election to purchase (the “Notice of Election to Purchase”) and
shall cause the Transfer Agent to mail a copy of such Notice of Election to
Purchase to the Record Holders of such class of Limited Partner Interests (as of
a Record Date selected by the General Partner) at least 10, but not more than
60, calendar days prior to the Purchase Date. Such Notice of Election to
Purchase shall also be published for a period of at least three (3) consecutive
Business Days in at least two daily newspapers of general circulation printed in
the English language and published in the Borough of Manhattan, New York. The
Notice of Election to Purchase shall specify the Purchase Date and the price
(determined in accordance with Section 15.1(a)(i)) at which Limited Partner
Interests will be purchased and state that the General Partner, its Affiliate or
the Partnership, as the case may be, elects to purchase such Limited Partner
Interests, upon surrender of Certificates representing such Limited Partner
Interests in the case of Limited Partner Interests evidenced by Certificates, in
exchange for payment, at such office or offices of the Transfer Agent as the
Transfer Agent may specify, or as may be required by any National Securities
Exchange on which such Limited Partner Interests are listed or admitted to
trading. Any such Notice of Election to Purchase mailed to a Record Holder of
Limited Partner Interests at his address as reflected in the records of the
Transfer Agent shall be conclusively presumed to have been given regardless of
whether the owner receives such notice. On or prior to the Purchase Date, the
General Partner, its Affiliate or the Partnership, as the case may be, shall
deposit with the Transfer Agent cash in an amount sufficient to pay the
aggregate purchase price of all of such Limited Partner Interests to be
purchased in accordance with this Section 15.1(b)(i). If the Notice of Election
to Purchase shall have been duly given as aforesaid at least 10 days prior to
the Purchase Date, and if on or prior to the Purchase Date the deposit described
in the preceding sentence has been made for the benefit of the holders of
Limited Partner Interests subject to purchase as provided herein, then from and
after the Purchase Date, notwithstanding that any Certificate shall not have
been surrendered for purchase, all rights of the holders of such Limited Partner
Interests (including any rights pursuant to Article III, Article IV, Article V,
Article VI, and Article XII) shall thereupon cease, except the right to receive
the purchase price (determined in accordance with Section 15.1(a)(i)) for
Limited Partner Interests therefor, without interest, upon surrender to the
Transfer Agent of the Certificates representing such Limited Partner Interests
in the case of Limited Partner Interests evidenced by Certificates, and such
Limited Partner Interests shall thereupon be deemed to be transferred to the
General Partner, its Affiliate or the Partnership, as the case may be, on the
record books of the Transfer Agent and the Partnership, and the General Partner
or any Affiliate of the General Partner, or the Partnership, as the case may be,
shall be deemed to be the owner of all such Limited Partner Interests from and
after the Purchase Date and shall have all rights as the owner of such Limited
Partner Interests (including all rights as owner of such Limited Partner
Interests pursuant to Article III, Article IV, Article V, Article VI and
Article XII).

 
 
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(ii)
In the case of a class of Limited Partner Interests for which no public market
exists and the General Partner has not selected the Transfer Agent to maintain
the records related to such class of Limited Partner Interests, deliver to each
holder of such class of Limited Partner Interests set forth in records
maintained by the Partnership (the “Holder”) a Notice of Election at least 10,
but not more than 60, calendar days prior to the Purchase Date. Such Notice of
Election to Purchase shall also be published for a period of at least three (3)
consecutive Business Days in at least two daily newspapers of general
circulation printed in the English language and published in the Borough of
Manhattan, New York. The Notice of Election to Purchase shall specify the
Purchase Date and the price (determined in accordance with Section 15.1(a)(ii))
at which Limited Partner Interests will be purchased and state that the General
Partner, its Affiliate or the Partnership, as the case may be, elects to
purchase such Limited Partner Interests, upon surrender of Certificates
representing such Limited Partner Interests in the case of Limited Partner
Interests evidenced by Certificates, in exchange for payment, at the office or
offices which the General Partner has specified may specify. Any such Notice of
Election to Purchase mailed to a Holder of Limited Partner Interests at his
address as reflected in the records of the Partnership shall be conclusively
presumed to have been given regardless of whether the owner receives such
notice. On or prior to the Purchase Date, the General Partner, its Affiliate or
the Partnership, as the case may be, shall deposit in an escrow account
established at a national banking institution cash in an amount sufficient to
pay the aggregate purchase price of all of such Limited Partner Interests to be
purchased in accordance with this Section 15.1(b)(ii). If the Notice of Election
to Purchase shall have been duly given as aforesaid at least 10 days prior to
the Purchase Date, and if on or prior to the Purchase Date the deposit described
in the preceding sentence has been made for the benefit of the holders of
Limited Partner Interests subject to purchase as provided herein, then from and
after the Purchase Date, notwithstanding that any Certificate shall not have
been surrendered for purchase, all rights of the holders of such Limited Partner
Interests (including any rights pursuant to Article III, Article IV, Article V,
Article VI, and Article XII) shall thereupon cease, except the right to receive
the purchase price (determined in accordance with Section 15.1(a)(ii)) for
Limited Partner Interests therefor, without interest, upon surrender to the
General Partner of the Certificates representing such Limited Partner Interests
in the case of Limited Partner Interests evidenced by Certificates, and such
Limited Partner Interests shall thereupon be deemed to be transferred to the
General Partner, its Affiliate or the Partnership, as the case may be, on the
record books of the Partnership, and the General Partner or any Affiliate of the
General Partner, or the Partnership, as the case may be, shall be deemed to be
the owner of all such Limited Partner Interests from and after the Purchase Date
and shall have all rights as the owner of such Limited Partner Interests
(including all rights as owner of such Limited Partner Interests pursuant to
Article III, Article IV, Article V, Article VI and Article XII).

 
 
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(c)
In the case of Limited Partner Interests evidenced by Certificates, at any time
from and after the Purchase Date, a holder of an Outstanding Limited Partner
Interests subject to purchase as provided in this Section 15.1 may surrender his
Certificate evidencing such Limited Partner Interesst to the Transfer Agent in
exchange for payment of the amount described in Section 15.1(b)(i), therefore,
without interest thereon.

 
ARTICLE XVI
GENERAL PROVISIONS
 
SECTION 16.1      Addresses and Notices; Written Communications.
 
 
(a)
Any notice, demand, request, report or proxy materials required or permitted to
be given or made to a Partner or Assignee under this Agreement shall be in
writing and shall be deemed given or made when delivered in person or when sent
by first class United States mail or by other means of written communication to
the Partner or Assignee at the address described below. Any notice, payment or
report to be given or made to a Partner or Assignee hereunder shall be deemed
conclusively to have been given or made, and the obligation to give such notice
or report or to make such payment shall be deemed conclusively to have been
fully satisfied, upon sending of such notice, payment or report to the Record
Holder of such Partnership Interests at his address as shown on the records of
the Transfer Agent or as otherwise shown on the records of the Partnership,
regardless of any claim of any Person who may have an interest in such
Partnership Interests by reason of any assignment or otherwise. Notwithstanding
the foregoing, if (i) a Partner shall consent to receiving notices, demands,
requests, reports or proxy materials via electronic mail or by the Internet or
(ii) the rules of the SEC shall permit any report or proxy materials to be
delivered electronically or made available via the Internet, any such notice,
demand, request, report or proxy materials shall be deemed given or made when
delivered or made available via such mode of delivery. An affidavit or
certificate of making of any notice, payment or report in accordance with the
provisions of this Section 16.1 executed by the General Partner, the Transfer
Agent or the mailing organization shall be prima facie evidence of the giving or
making of such notice, payment or report. If any notice, payment or report given
or made in accordance with this Section 16.1 is returned marked to indicate that
such notice, payment or report was unable to be delivered, such notice, payment
or report, and, in the case of notices, payments or reports returned by the
United States Postal Service (or other physical mail delivery service outside
the United States of America), any subsequent notices, payments and reports
shall be deemed to have been duly given or made without further mailing (until
such time as such Record Holder or another Person notifies the Transfer Agent or
the Partnership of a change in his address) or other delivery if they are
available for the Partner or Assignee at the principal office of the Partnership
for a period of one year from the date of the giving or making of such notice,
payment or report to the other Partners and Assignees. Any notice to the
Partnership shall be deemed given if received by the General Partner at the
principal office of the Partnership designated pursuant to Section 2.3. The
General Partner may rely and shall be protected in relying on any notice or
other document from a Partner, Assignee or other Person if believed by it to be
genuine.

 
 
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(b)
The terms “in writing,” “written communications,” “written notice” and words of
similar meaning shall be deemed satisfied under this Agreement if such writing,
communication or notice is sent by e-mail or other forms of electronic
communication to an address previously furnished by the intended recipient to
the General Partner.

 
SECTION 16.2      Further Action. The parties shall execute and deliver all
documents, provide all information and take or refrain from taking action as may
be necessary or appropriate to achieve the purposes of this Agreement.
 
SECTION 16.3      Binding Effect. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their heirs, executors, administrators,
successors, legal representatives and permitted assigns.
 
SECTION 16.4     Integration. Except for agreements with Affiliates of the
General Partner, this Agreement constitutes the entire agreement among the
parties hereto pertaining to the subject matter hereof and supersedes all prior
agreements and understandings pertaining thereto.
 
SECTION 16.5      Creditors. None of the provisions of this Agreement shall be
for the benefit of, or shall be enforceable by, any creditor of the Partnership.
 
SECTION 16.6      Waiver. No failure by any party to insist upon the strict
performance of any covenant, duty, agreement or condition of this Agreement or
to exercise any right or remedy consequent upon a breach thereof shall
constitute waiver of any such breach of any other covenant, duty, agreement or
condition.
 
SECTION 16.7      Counterparts. This Agreement may be executed in counterparts,
all of which together shall constitute an agreement binding on all the parties
hereto, notwithstanding that all such parties are not signatories to the
original or the same counterpart. Each party shall become bound by this
Agreement immediately upon affixing its signature hereto or, in the case of a
Person acquiring a Limited Partnership Interest pursuant to Section 10.1(a)
without execution hereof.
 
SECTION 16.8      Third-Party Beneficiaries. Each Partner agrees that (a) any
Indemnitee shall be entitled to assert rights and remedies hereunder as a
third-party beneficiary hereto with respect to those provisions of this
Agreement affording a right, benefit or privilege to such Indemnitee and (b) any
Unrestricted Person shall be entitled to assert rights and remedies hereunder as
a third-party beneficiary hereto with respect to those provisions of this
Agreement affording a right, benefit or privilege to such Unrestricted Person.
 
SECTION 16.9      Applicable Law; Forum, Venue and Jurisdiction.
 
 
(a)
This Agreement shall be construed in accordance with and governed by the laws of
the State of Delaware, without regard to the principles of conflicts of law.

 
 
(b)
Each of the Partners and each Person holding any beneficial interest in the
Partnership (whether through a broker, dealer, bank, trust company or clearing
corporation or an agent of any of the foregoing or otherwise):

 
 
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(i)
irrevocably agrees that any claims, suits, actions or proceedings (A) arising
out of or relating in any way to this Agreement (including any claims, suits or
actions to interpret, apply or enforce the provisions of this Agreement or the
duties, obligations or liabilities among Partners or of Partners to the
Partnership, or the rights or powers of, or restrictions on, the Partners or the
Partnership), (B) brought in a derivative manner on behalf of the Partnership,
(C) asserting a claim of breach of a fiduciary duty owed by any director,
officer, or other employee of the Partnership or the General Partner, or owed by
the General Partner, to the Partnership or the Partners, (D) asserting a claim
arising pursuant to any provision of the Delaware Act or (E) asserting a claim
governed by the internal affairs doctrine shall be exclusively brought in Court
of Chancery of the State of Delaware, in each case regardless of whether such
claims, suits, actions or proceedings sound in contract, tort, fraud or
otherwise, are based on common law, statutory, equitable, legal or other
grounds, or are derivative or direct claims;

 
 
(ii)
irrevocably submits to the exclusive jurisdiction of the Court of Chancery of
the State of Delaware in connection with any such claim, suit, action or
proceeding;

 
 
(iii)
agrees not to, and waives any right to, assert in any such claim, suit, action
or proceeding that (A) it is not personally subject to the jurisdiction of the
Court of Chancery of the State of Delaware or of any other court to which
proceedings in the Court of Chancery of the State of Delaware may be appealed,
(B) such claim, suit, action or proceeding is brought in an inconvenient forum,
or (C) the venue of such claim, suit, action or proceeding is improper;

 
 
(iv)
expressly waives any requirement for the posting of a bond by a party bringing
such claim, suit, action or proceeding; and

 
 
(v)
consents to process being served in any such claim, suit, action or proceeding
by mailing, certified mail, return receipt requested, a copy thereof to such
party at the address in effect for notices hereunder, and agrees that such
services shall constitute good and sufficient service of process and notice
thereof; provided, nothing in clause (v)  hereof shall affect or limit any right
to serve process in any other manner permitted by law.

 
SECTION 16.10    Invalidity of Provisions. If any provision or part of a
provision of this Agreement is or becomes for any reason invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions and parts thereof contained herein shall not be affected
thereby and this Agreement shall, to the fullest extent permitted by law, be
reformed and construed as if such invalid, illegal or unenforceable provision,
or part of a provision, had never been contained herein, and such provision or
part reformed so that it would be valid, legal and enforceable to the maximum
extent possible.
 
SECTION 16.11    Consent of Partners. Each Partner hereby expressly consents and
agrees that, whenever in this Agreement it is specified that an action may be
taken upon the affirmative vote or consent of less than all of the Partners,
such action may be so taken upon the concurrence of less than all of the
Partners and each Partner shall be bound by the results of such action.
 
SECTION 16.12    Facsimile Signatures. The use of facsimile signatures affixed
in the name and on behalf of the Transfer Agent and registrar of the Partnership
on Certificates representing Units is expressly permitted by this Agreement.
 
[Signatures on following page]

 
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first written above.
 

 
GENERAL PARTNER:
     
CENTRAL ENERGY GP LLC
     
By:
Central Energy, LP
   
its Sole Member
         
By:
/s/ Imad K. Anbouba
     
Imad K. Anbouba
     
Co-President
           
By:
/s/ Carter R. Montgomery
     
Carter R. Montgomery
     
Co-President
         
LIMITED PARTNERS:
     
All Limited Partners now and hereafter admitted as Limited Partners of the
Partnership, pursuant to powers of attorney now and hereafter executed in favor
of, and granted and delivered to the General Partner.
       
By:
CENTRAL ENERGY GP LLC
   
General Partner, as attorney-in-fact for the Limited Partners pursuant to the
Powers of Attorney granted in Section 2.6 of the Amended and Restated Agreement
of Limited Partnership of Central Energy Partners LP
           
By:
/s/ Imad K. Anbouba
       
Imad K. Anbouba
       
Co-President
               
By:
/s/ Carter R. Montgomery
       
Carter R. Montgomery
       
Co-President

 
 
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EXHIBIT A
TO THE SECOND AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP OF
CENTRAL ENERGY PARTNERS LP
 
CERTIFICATE EVIDENCING COMMON UNITS
REPRESENTING LIMITED PARTNER INTERESTS IN
CENTRAL ENERGY PARTNERS LP
 
No._______________
_______________ Common Units

 
In accordance with Section 4.1 of the Second Amended and Restated Agreement of
Limited Partnership of Central Energy Partners LP, as amended, supplemented or
restated from time to time (the “Partnership Agreement”), Central Energy
Partners LP, a Delaware limited partnership (the “Partnership”), hereby
certifies that _______________ (the “Holder”) is the registered owner of Common
Units representing limited partner interests in the Partnership (the “Common
Units”) transferable on the books of the Partnership, in person or by duly
authorized attorney, upon surrender of this Certificate properly endorsed and
accompanied by a properly executed application for transfer of the Common Units
represented by this Certificate. The rights, preferences and limitations of the
Common Units are set forth in, and this Certificate and the Common Units
represented hereby are issued and shall in all respects be subject to the terms
and provisions of, the Partnership Agreement. Copies of the Partnership
Agreement are on file at, and will be furnished without charge on delivery of
written request to the Partnership at, the principal office of the Partnership
located at 8150 North Central Expressway, Suite 1525, Dallas, Texas 75206.
Capitalized terms used herein but not defined shall have the meanings given them
in the Partnership Agreement.
 
THE COMMON UNITS REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933 (THE “ACT”) AND ARE “RESTRCITED SECURITIES” AS THAT
TERM IS DEFINED IN RULE 144 UNDER THE ACT. THE SHARES MAY NOT BE OFFERED FOR
SALE,SOLD OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT, OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
ACT, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY.

THE HOLDER OF THIS SECURITY ACKNOWLEDGES FOR THE BENEFIT CENTRAL ENERGY PARTNERS
LP THAT THIS SECURITY MAY NOT BE SOLD, OFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED IF SUCH TRANSFER WOULD (A) VIOLATE THE THEN APPLICABLE FEDERAL OR
STATE SECURITIES LAWS OR RULES AND REGULATIONS OF THE SECURITIES AND EXCHANGE
COMMISSION, ANY STATE SECURITIES COMMISSION OR ANY OTHER GOVERNMENTAL AUTHORITY
WITH JURISDICTION OVER SUCH TRANSFER, (B) TERMINATE THE EXISTENCE OR
QUALIFICATION OF CENTRAL ENERGY PARTNERS LP UNDER THE LAWS OF THE STATE OF
DELAWARE, OR (C) CAUSE CENTRAL ENERGY PARTNERS LP TO BE TREATED AS AN
ASSOCIATION TAXABLE AS A CORPORATION OR OTHERWISE TO BE TAXED AS AN ENTITY FOR
FEDERAL INCOME TAX PURPOSES (TO THE EXTENT NOT ALREADY SO TREATED OR TAXED).
CENTRAL ENERGY GP LLC, THE GENERAL PARTNER OF CENTRAL ENERGY PARTNERS LP, MAY
IMPOSE ADDITIONAL RESTRICTIONS ON THE TRANSFER OF THIS SECURITY IF IT RECEIVES
AN OPINION OF COUNSEL THAT SUCH RESTRICTIONS ARE NECESSARY TO AVOID A
SIGNIFICANT RISK OF CENTRAL ENERGY PARTNERS LP BECOMING TAXABLE AS A CORPORATION
OR OTHERWISE BECOMING TAXABLE AS AN ENTITY FOR FEDERAL INCOME TAX PURPOSES. THE
RESTRICTIONS SET FORTH ABOVE SHALL NOT PRECLUDE THE SETTLEMENT OF ANY
TRANSACTIONS INVOLVING THIS SECURITY ENTERED INTO THROUGH THE FACILITIES OF ANY
NATIONAL SECURITIES EXCHANGE ON WHICH THIS SECURITY IS LISTED OR ADMITTED TO
TRADING.
 
 
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The Holder, by accepting this Certificate, is deemed to have (i) requested
admission as, and agreed to become, a Limited Partner and to have agreed to
comply with and be bound by and to have executed the Partnership Agreement, (ii)
represented and warranted that the Holder has all right, power and authority
and, if an individual, the capacity necessary to enter into the Partnership
Agreement, (iii) granted the powers of attorney provided for in the Partnership
Agreement and (iv) made the waivers and given the consents and approvals
contained in the Partnership Agreement.
 
This Certificate shall not be valid for any purpose unless it has been
countersigned and registered by the Transfer Agent and Registrar.
 
Dated:
   
CENTRAL ENERGY PARTNERS LP
Countersigned and Registered by:
 
By: Central Energy GP LLC,
   
its General Partner
   
By:
   
as Transfer Agent and Registrar
 
Name:
   
By:
   
By:
   
Authorized Signature
 
Secretary

 
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Reverse of Certificate
 
ABBREVIATIONS
 
The following abbreviations, when used in the inscription on the face of this
Certificate, shall be construed as follows according to applicable laws or
regulations:
 
TEN COM —
 
as tenants in common
 
UNIF GIFT/TRANSFERS MIN ACT
TEN ENT —
 
as tenants by the entireties Custodian
   
(Cust)
(Minor)
JT TEN —
  
as joint tenants with right of survivorship and not as tenants in Common
  
under Uniform Gifts/Transfers to CD Minors Act
(State)

 
Additional abbreviations, though not in the above list, may also be used.
 
ASSIGNMENT OF COMMON UNITS
IN
CENTRAL ENERGY PARTNERS LP
 
IMPORTANT NOTICE REGARDING INVESTOR RESPONSIBILITIES
DUE TO TAX SHELTER STATUS OF
CENTRAL ENERGY PARTNERS LP
 
You have acquired an interest in Central Energy Partners LP, 8150 North Central
Expressway, Suite 1525, Dallas, Texas 75206, whose taxpayer identification
number is 20-0153267. The Internal Revenue Service has issued Central Energy
Partners LP the following tax shelter registration number:
 
YOU MUST REPORT THIS REGISTRATION NUMBER TO THE INTERNAL REVENUE SERVICE IF YOU
CLAIM ANY DEDUCTION, LOSS, CREDIT OR OTHER TAX BENEFIT OR REPORT ANY INCOME BY
REASON OF YOUR INVESTMENT IN CENTRAL ENERGY PARTNERS LP.
 
You must report the registration number as well as the name and taxpayer
identification number of Central Energy Partners LP on Form 8271.
 
FORM 8271 MUST BE ATTACHED TO THE RETURN ON WHICH YOU CLAIM THE DEDUCTION, LOSS,
CREDIT OR OTHER TAX BENEFIT OR REPORT ANY INCOME BY REASON OF YOUR INVESTMENT
CENTRAL ENERGY PARTNERS LP.
 
If you transfer your interest in Central Energy Partners LP to another person,
you are required by the Internal Revenue Service to keep a list containing (a)
that person’s name, address and taxpayer identification number, (b) the date on
which you transferred the interest and (c) the name, address and tax shelter
registration number of Central Energy Partners LP. If you do not want to keep
such a list, you must (1) send the information specified above to the
Partnership, which will keep the list for this tax shelter, and (2) give a copy
of this notice to the person to whom you transfer your interest. Your failure to
comply with any of the above-described responsibilities could result in the
imposition of a penalty under Section 6707(b) or 6708(a) of the Internal Revenue
Code of 1986, as amended, unless such failure is shown to be due to reasonable
cause.
 
 
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ISSUANCE OF A REGISTRATION NUMBER DOES NOT INDICATE THAT THIS INVESTMENT OR THE
CLAIMED TAX BENEFITS HAVE BEEN REVIEWED, EXAMINED OR APPROVED BY THE INTERNAL
REVENUE SERVICE.
 
FOR VALUE RECEIVED, ___________________ hereby assigns, conveys, sells and
transfers unto
 

         
(Please print or typewrite name and address of Assignee)
  
(Please insert Social Security or other identifying number of Assignee)

 
Common Units representing limited partner interests evidenced by this
Certificate, subject to the Partnership Agreement, and does hereby irrevocably
constitute and appoint ____________________ as its attorney-in-fact with full
power of substitution to transfer the same on the books of Central Energy
Partners LP.
 
Date:
   
 
NOTE: The signature to any endorsement hereon must correspond with the name as
written upon the face of this Certificate in every particular,
without  alteration, enlargement or change.
     

 
THE SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS,
STOCKBROKERS, SAVING AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATORY GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE
17Ad-15
       
Signature
             
 
   
Signature

 
No transfer of the Common Units evidenced hereby will be registered on the books
of the Partnership, unless the Certificate evidencing the Common Units to be
transferred is surrendered for registration or transfer and an Application for
Transfer of Common Units has been executed by a transferee either (a) on the
form set forth below or (b) on a separate application that the Partnership will
furnish on request without charge. A transferor of the Common Units shall have
no duty to the transferee with respect to execution of the transfer application
in order for such transferee to obtain registration of the transfer of the
Common Units.
 
APPLICATION FOR TRANSFER OF COMMON UNITS
 
The undersigned (“Assignee”) hereby applies for transfer to the name of the
Assignee of the Common Units evidenced hereby.
 
The Assignee (a) requests admission as a Substituted Limited Partner and agrees
to comply with and be bound by, and hereby executes, the Second Amended and
Restated Agreement of Limited Partnership of Central Energy Partners LP (the
“Partnership”), as amended, supplemented or restated to the date hereof (the
“Partnership Agreement”), (b) represents and warrants that the Assignee has all
right, power and authority and, if an individual, the capacity necessary to
enter into the Partnership Agreement, (c) appoints the General Partner of the
Partnership and, if a Liquidator shall be appointed, the Liquidator of the
Partnership as the Assignee’s attorney-in-fact to execute, swear to, acknowledge
and file any document, including, without limitation, the Partnership Agreement
and any amendment thereto and the Certificate of Limited Partnership of the
Partnership and any amendment thereto, necessary or appropriate for the
Assignee’s admission as a Substituted Limited Partner and as a party to the
Partnership Agreement, (d) gives the powers of attorney provided for in the
Partnership Agreement, and (e) makes the waivers and gives the consents and
approvals contained in the Partnership Agreement. Capitalized terms not defined
herein have the meanings assigned to such terms in the Partnership Agreement.

 
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Date:
                   
Social Security or other identifying number
 
Signature of Assignee
           
Purchase Price including SECs, if any
  
Name and Address of Assignee

 
Type of Entity (check one):
 
¨ Individual
¨ Partnership
¨ Corporation
¨ Trust
¨ Other (specify)
 

 
Nationality (check one):
 
¨ U.S. Citizen, Resident or Domestic Entity
 
¨ Foreign Corporation
¨ Non-resident Alien
 

 
If the U.S. Citizen, Resident or Domestic Entity box is checked, the following
certification must be completed.
 
Under Section 1445(e) of the Internal Revenue Code of 1986, as amended (the
“Code”), the Partnership must withhold tax with respect to certain transfers of
property if a holder of an interest in the Partnership is a foreign person. To
inform the Partnership that no withholding is required with respect to the
undersigned Interestholder’s interest in it, the undersigned hereby certifies
the following (or, if applicable, certifies the following on behalf of the
Interestholder).
 
Complete Either A or B:
 
A.
Individual Interestholder

 
 
1
I am not a non-resident alien for purposes of U.S. income taxation.

 
 
2
My U.S. taxpayer identification number (Social Security Number) is

 

 
 
 
.

 
 
3
My home address is

 
 
 

 
B.
Partnership, Corporation or Other Interestholder

 
 
1.
____________________________ is not a foreign corporation, foreign partnership,
foreign trust (Name of Interestholder) or foreign estate (as those terms are
defined in the Code and Treasury Regulations).

 
 
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2.
The Interestholder’s U.S. employer identification number is

 

 
 
 
 

 
 
3.
The Interestholder’s office address and place of incorporation (if applicable)
is ________________.

 
The Interestholder agrees to notify the Partnership within sixty (60) days of
the date the Interestholder becomes a foreign person.
 
The Interestholder understands that this certificate may be disclosed to the
Internal Revenue Service by the Partnership and that any false statement
contained herein could be punishable by fine, imprisonment or both.
 
Under penalties of perjury, I declare that I have examined this certification
and to the best of my knowledge and belief it is true, correct and complete and,
if applicable, I further declare that I have authority to sign this document on
behalf of:
 

       
Name of Interestholder
           
Signature and Date
           
Title (if applicable)

 
Note: If the Assignee is a broker, dealer, bank, trust company, clearing
corporation, other nominee holder or an agent of any of the foregoing, and is
holding for the account of any other person, this application should be
completed by an officer thereof or, in the case of a broker or dealer, by a
registered representative who is a member of a registered national securities
exchange or a member of the National Association of Securities Dealers, Inc.,
or, in the case of any other nominee holder, a person performing a similar
function. If the Assignee is a broker, dealer, bank, trust company, clearing
corporation, other nominee owner or an agent of any of the foregoing, the above
certification as to any person for whom the Assignee will hold the Common Units
shall be made to the best of the Assignee’s knowledge.
 
 
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