Exhibit 10(j)
 
EXECUTION COPY
 
AMENDMENT NO. 1 TO THE
AMENDED AND RESTATED OPERATING AGREEMENT
OF
CENTERLINE CAPITAL COMPANY, LLC

 
THIS AMENDMENT NO. 1 (this “Amendment”) to the Amended and Restated Operating
Agreement of Centerline Capital Company, LLC, a Delaware limited liability
company formerly known as CharterMac Capital Company, LLC (the “Company”), dated
as of November 17, 2003 (the “Operating Agreement”), is entered into by and
among Centerline Capital Group Inc. a Delaware corporation formerly known as
CharterMac Corporation, as managing member (the “Managing Member”), and the
Investor Members who have executed and delivered this Amendment.  Capitalized
terms not otherwise defined in this Amendment have the meanings ascribed to them
in the Operating Agreement.
 
RECITALS:
 
WHEREAS, the Managing Member (i) has entered into a purchase and sale agreement,
by and among C-III Capital Partners LLC ("Newco"), a subsidiary of Island C-III
Holdings LLC, on the one hand, and the Managing Member and its parent,
Centerline Holding Company (“Centerline”) and certain of their subsidiaries, on
the other hand, pursuant to which Newco will acquire (a) Centerline's assets
comprising the former ARCap Investors LLC business and certain other assets and
(b) newly issued Special Series A Shares of Centerline; and (ii) has and/or will
be entering into various agreements with certain of its lenders, creditors and
claimants to restructure certain of its other outstanding debt obligations and a
management agreement with an affiliate of Newco pursuant to which it will
provide executive management services to Centerline (the "Transaction");
 
WHEREAS, as a condition to consummating the Transaction, certain of the Investor
Members have agreed to amend the Operating Agreement to eliminate (x) the
distribution tax gross-up (i.e., the Preferred Return) and provide that the
distribution on each Special Common Unit will be equal in amount to the
dividend, if any, paid on each Common Share and (y) the Managing Member’s
obligation to contribute the Quarterly Distribution Shortfall;
 
WHEREAS, pursuant to Sections 8.2(b) and 14.1 of the Operating Agreement,
adoption of this Amendment requires the Consent of Investor Members;
 
WHEREAS, “Consent of Investor Members” is defined in the Operating Agreement as
the consent or approval of a proposed action by Investor Members holding at
least a specified percentage of the Special Common Units equal to the initial
Membership Interest of Related General II, L.P (“RG II”) plus .1%, but such
percentage was not filled in at the time of execution of the Operating Agreement
but should have been reflected as 63.17%
 
 
 
 
 
 
 

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WHEREAS, in connection with the consummation of the Transaction and in
accordance with Sections 8.2(b) and 14.1 of the Operating Agreement, the Consent
of Investor Members to this Amendment has been received (as evidenced by
execution hereof by Investor Members holding at least 63.17% of the Special
Common Units); and
 
WHEREAS, the Managing Member has duly approved and adopted this Amendment in
accordance with Sections 8.2(b) and 14.1 of the Operating Agreement.
 
NOW, THEREFORE, the parties hereto agree as follows:
 
A.  Amendments.

 
The Operating Agreement is hereby amended effective as of the consummation of
the Transaction (the “Effective Date”), as follows:
 
1.  
Article 1.  The definition of “Preferred Return” in Article 1 of the Operating
Agreement is hereby deleted in its entirety and replaced with the following:

 
“Preferred Return” means, an amount equal to the dividend paid by CharterMac
with respect to a CharterMac (now known as Centerline Holding Company) Common
Share, as adjusted for the Exchange Factor.
 
2.  
Section 4.2(d).  Section 4.2(d) of the Operating Agreement is hereby deleted in
its entirety.

 
3.  
Section 5.1.  The last two sentences of Section 5.1 of the Operating Agreement
are hereby deleted in their entirety.

 
B.  Miscellaneous

 
1.  
No Further Amendments.  Except as otherwise amended herein, the Operating
Agreement remains unchanged and in full force and effect.  This Amendment is
effective against all parties hereto and to those Investor Members not otherwise
excluded from its effectiveness pursuant to Section 14.1(c) of the Operating
Agreement.

 
2.  
Governing Law.  This Amendment shall be governed by and construed in accordance
with the laws of the State of Delaware (without regard to conflict of laws
principles), all rights and remedies being governed by such laws.

 
3.  
Severability.  Each provision of this Amendment is intended to be severable. If
any term or provision of this Amendment is illegal or invalid for any reason,
such illegality or invalidity will not affect the legality or invalidity of the
remainder of this Amendment.

 
4.  
Counterparts; Facsimile; PDF.  This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original and all of which shall
constitute one and the same instrument.  Any facsimile or portable document
format copies hereof or signature hereon shall, for all purposes, be deemed
originals.

 
 
 
 
 
 
 

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5.  
Name Change.  The parties hereto confirm the change in the name of the Company
to “Centerline Capital Company, LLC.”

 

[SIGNATURE PAGE FOLLOWS]
 
 
 
 
 
 
 

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IN WITNESS WHEREOF, the undersigned have duly executed this Amendment as of the
Effective Date.
 

Managing Member:
 
CENTERLINE CAPITAL GROUP INC.
   
By:
/s/ Marc D. Schnitzer
Name:
Marc D. Schnitzer
Title:
Chief Executive Officer & President
 
Investor Members:
 
RELATED GENERAL II L.P.
 
By: RCMP, Inc., its general partner
   
By:
/s/ Jeff Blau  
Name:  Jeff Blau
 
Title:  President
 
MARC ASSOCIATES, L.P.
 
By:  Marc Associates, Inc., its general partner
     
By:
/s/ Marc D. Schnitzer
 
Name:  Marc D. Schnitzer
 
Title:  President
 
/s/ Jeff T. Blau
Jeff T. Blau
 
/s/ Andrew J. Weil
Andrew J. Weil
 
/s/ Justin E. Ginsberg
Justin E. Ginsberg