Exhibit 10.02

Execution Version

 

 

 

BREIT SPECIAL LIMITED PARTNER L.P.

AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT

DATED AS OF AUGUST 6, 2019

EFFECTIVE JANUARY 1, 2018

 

 

 

THE PARTNERSHIP INTERESTS (THE “INTERESTS”) OF BREIT SPECIAL LIMITED PARTNER
L.P., A DELAWARE LIMITED PARTNERSHIP (THE “PARTNERSHIP”), HAVE NOT BEEN
REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), THE SECURITIES LAWS OF ANY STATE OR ANY OTHER APPLICABLE SECURITIES LAWS
IN RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND SUCH LAWS. SUCH INTERESTS MUST BE ACQUIRED FOR INVESTMENT ONLY AND MAY
NOT BE OFFERED FOR SALE, PLEDGED, HYPOTHECATED, SOLD, ASSIGNED OR TRANSFERRED AT
ANY TIME EXCEPT IN COMPLIANCE WITH (I) THE SECURITIES ACT, ANY APPLICABLE STATE
SECURITIES LAWS, AND ANY OTHER APPLICABLE SECURITIES LAWS; AND (II) THE TERMS
AND CONDITIONS OF THIS LIMITED PARTNERSHIP AGREEMENT. THE INTERESTS MAY NOT BE
TRANSFERRED OF RECORD EXCEPT IN COMPLIANCE WITH SUCH LAWS AND THIS LIMITED
PARTNERSHIP AGREEMENT. THEREFORE, PURCHASERS OF SUCH INTERESTS WILL BE REQUIRED
TO BEAR THE RISK OF THEIR INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.

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TABLE OF CONTENTS

 

ARTICLE I DEFINITIONS

     2  

Section 1.1

  Definitions      2  

Section 1.2

  Terms Generally      7  

ARTICLE II GENERAL PROVISIONS

     7  

Section 2.1

  Converstion; Formation      7  

Section 2.2

  General Partner, Limited Partner, Special Partner      7  

Section 2.2

  Continuation; Name; Foreign Jurisdictions      7  

Section 2.3

  Term      8  

Section 2.4

  Purpose; Powers      8  

Section 2.5

  Registered Office; Place of Business; Registered Agent      10  

ARTICLE III MANAGEMENT

     10  

Section 3.1

  General Partner      10  

Section 3.2

  Partner Voting, etc.      10  

Section 3.3

  Management      11  

Section 3.4

  Responsibilities of Partners      12  

Section 3.5

  Exculpation and Indemnification      12  

Section 3.6

  Representations of Partners      14  

Section 3.7

  Tax Representation and Further Assurances      15  

ARTICLE IV CAPITAL OF THE PARTNERSHIP

     16  

Section 4.1

  Capital Contributions by Partners      16  

Section 4.2

  Interest      16  

Section 4.3

  Partial Withdrawals of Capital      16  

ARTICLE V PARTICIPATION IN PROFITS AND LOSSES

     16  

Section 5.1

  General Accounting Matters      16  

Section 5.2

  Capital Accounts      18  

Section 5.3

  Profit Sharing Percentages      18  

Section 5.4

  Allocations of Net Income (Loss)      19  

Section 5.5

  Liability of Partners      19  

Section 5.6

  Repurchase Rights, etc.      19  

Section 5.7

  Distributions      19  

Section 5.8

  Business Expenses      20  

ARTICLE VI ADDITIONAL PARTNERS; WITHDRAWAL OF PARTNERS; SATISFACTION AND
DISCHARGE OF PARTNERSHIP INTERESTS; TERMINATION

     20  

Section 6.1

  Additional Partners      20  

Section 6.2

  Withdrawal of Partners      21  

Section 6.3

  Partnership Interests Not Transferable      22  

Section 6.4

  Consequences upon Withdrawal of a Partner      22  

Section 6.5

  Satisfaction and Discharge of a Withdrawn Partner’s Interest      23  

Section 6.6

  Dissolution of the Partnership      26  

Section 6.7

  Certain Tax Matters      26  

Section 6.8

  Special Basis Adjustments      29  

ARTICLE VII MISCELLANEOUS

     29  

Section 7.1

  Submission to Jurisdiction; Waiver of Jury Trial      29  

 

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Section 7.2

  Ownership and Use of the Blackstone Name      30  

Section 7.3

  Written Consent      30  

Section 7.4

  Admission Letters; Schedules      30  

Section 7.5

  Governing Law; Separability of Provisions      31  

Section 7.6

  Successors and Assigns      31  

Section 7.8

  Confidentiality; Restrictive Covenants      31  

Section 7.9

  Notices      32  

Section 7.10

  Counterparts      32  

Section 7.11

  Power of Attorney      32  

Section 7.12

  Cumulative Remedies      33  

Section 7.13

  Legal Fees      33  

Section 7.15

  Entire Agreement      33  

 

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BREIT SPECIAL LIMITED PARTNER L.P.

AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT (this “Agreement”) of BREIT
SPECIAL LIMITED PARTNER L.P., a Delaware limited partnership (the
“Partnership”), dated as of August 6, 2019, by and among Blackstone Holdings III
L.P., a Québec société en commandite, as general partner of the Partnership (in
its capacity as general partner of the Partnership the “General Partner”), the
other partners of the Partnership as set forth in the books and records of the
Partnership, and such other persons that are admitted to the Partnership as
partners after the date hereof in accordance herewith.

W I T N E S S E T H

WHEREAS BREIT Special Limited Partner L.L.C. (the “Company”) was formed as a
limited liability company under the laws of the State of Delaware pursuant to
the filing of a Certificate of Formation with the Office of the Secretary of
State of the State of Delaware on August 5, 2016; and a Limited Liability
Company Agreement, dated as of August 23, 2016 (the “LLC Agreement”), by
Blackstone Holdings III L.P., as the sole member of the Company;

WHEREAS, (i) the Company’s conversion to BREIT Special Limited Partner L.P., a
Delaware limited partnership, and (ii) the adoption of this Agreement were each
authorized under the LLC Agreement, and the Delaware Limited Liability Company
Act (6 Del. C. § 18-101, et seq.), as amended from time to time, and any
successor to such statute (the “LLC Act”);

WHEREAS, on January 25, 2018, the Company was converted to a limited partnership
(the “Conversion”) pursuant to the Delaware Revised Uniform Limited Partnership
Act, 6 Del. C. § 17-101, et seq., as it may be amended from time to time (the
“Partnership Act”), and Section 18-216 of the LLC Act by causing the filing in
the office of the Secretary of State of the State of Delaware of a Certificate
of Conversion to Limited Partnership of the Company to the Partnership and a
Certificate of Limited Partnership of the Partnership;

WHEREAS, the limited liability company interests of the Company were converted
into partnership interests in the Partnership in accordance with Section 2.1 of
this Agreement;

WHEREAS, in accordance with Section 17-217(g) of the Partnership Act, the
Partnership shall constitute a continuation of the existence of the Company in
the form of a Delaware limited partnership and, for all purposes of the laws of
the State of Delaware, shall be deemed to be the same entity as the Company;

WHEREAS, it is the intent of the current and former Partners of the Partnership
that the Conversion is effective as of January 1, 2018.

WHEREAS, the parties hereto desire to enter into this Agreement;

NOW, THEREFORE, in consideration of the mutual promises and agreements herein
made and intending to be legally bound hereby, the parties hereto agree to
continue the existence of the Company in the form of the Partnership, and as
follows:

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ARTICLE I

DEFINITIONS

Section 1.1 Definitions. Unless the context otherwise requires, the following
terms shall have the following meanings for purposes of this Agreement:

“Admission Letter” has the meaning set forth in Section 7.4.

“Affiliate” when used with reference to another person means any person (other
than the Partnership), directly or indirectly, through one or more
intermediaries, controlling, controlled by, or under common control with, such
other person, which may include, for greater certainty and as the context
requires, endowment funds, estate planning vehicles (including any trusts,
family members, family investment vehicles, descendant, trusts and other related
persons and entities), charitable programs and other similar and/or related
vehicles or accounts associated with or established by Blackstone and/or its
affiliates, partners and current and/or former employees and/or related persons.

“Agreement” means this Amended and Restated Limited Partnership Agreement, as it
may be further amended, supplemented, restated or otherwise modified from time
to time.

“BE Agreement” means the limited partnership agreement, limited liability
company agreement or other governing document of any limited partnership,
limited liability company or other entity referred to in the definition of
“Blackstone Entity,” as such limited partnership agreement, limited liability
company agreement or other governing document may be amended, supplemented,
restated or otherwise modified to date, and as such limited partnership
agreement, limited liability company agreement or other governing document may
be further amended, supplemented, restated or otherwise modified from time to
time.

“Blackstone” means, collectively, The Blackstone Group Inc., a Delaware
corporation, and any successor thereto, and any Affiliate thereof (excluding any
natural persons and any portfolio companies, investments or similar entities of
any Blackstone-sponsored fund (or any affiliate thereof that is not otherwise an
Affiliate of The Blackstone Group Inc.)).

“Blackstone Entity” means any partnership, limited liability company or other
entity (excluding any natural persons and any portfolio companies of any
Blackstone–sponsored fund) that is an Affiliate of The Blackstone Group Inc., as
designated by the General Partner in its sole discretion.

“BREIT Operating Partnership L.P.” means the Delaware limited partnership formed
pursuant to the Limited Partnership Agreement entered into as of August 25, 2016
(as amended, supplemented, modified or restated from time to time), between
Blackstone Real Estate Income Trust, Inc., a Maryland corporation, as general
partner and the Company as a limited partner.

“Capital Account” means a capital account established for each Partner in the
books and records of the Partnership and maintained and adjusted as provided in
Articles V and VI. A separate Capital Account shall be established for each
Partner with respect to each category of Net Income (Loss) (including, without
limitation, Fund Net Income (Loss), Other Net Income (Loss) and the Performance
Allocation) as may be determined by the General Partner in its sole discretion.

“Cause” means the occurrence or existence of any of the following with respect
to a Partner, as determined fairly, reasonably, on an informed basis and in good
faith by the General Partner: (i) (w) any breach by any Partner of any provision
of any non-competition agreement, (x) any material

 

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breach of this Agreement or any rules or regulations applicable to such Partner
that are established by the General Partner, (y) such Partner’s deliberate
failure to perform his or her duties to the Partnership or any of its
Affiliates, or (z) such Partner’s committing to or engaging in any conduct or
behavior that is or may be harmful to the Partnership or any of its Affiliates
in a material way as determined by the General Partner; provided, that in the
case of any of the foregoing clauses (w), (x), (y) and (z), the General Partner
has given such Partner written notice (a “Notice of Breach”) within 15 days
after the General Partner becomes aware of such action and such Partner fails to
cure such breach, failure to perform, conduct or behavior within 15 days after
receipt of such Notice of Breach from the General Partner (or such longer
period, not to exceed an additional 15 days, as shall be reasonably required for
such cure, provided that such Partner is diligently pursuing such cure);
(ii) any act of fraud, misappropriation, dishonesty, embezzlement or similar
conduct against the Partnership or any of its Affiliates; (iii) conviction (on
the basis of a trial or by an accepted plea of guilty or nolo contendere) of a
felony (under U.S. law or its equivalent in any jurisdiction) or crime
(including any misdemeanor charge involving moral turpitude, false statements or
misleading omissions, forgery, wrongful taking, embezzlement, extortion or
bribery), or a determination by a court of competent jurisdiction, by a
regulatory body or by a self-regulatory body having authority with respect to
securities laws, rules or regulations of the applicable securities industry,
that such Partner individually has violated any applicable securities laws or
any rules or regulations thereunder, or any rules of any such self-regulatory
body (including, without limitation, any licensing requirement), if such
conviction or determination has a material adverse effect on (A) such Partner’s
ability to function as a Partner of the Partnership, taking into account the
services required of such Partner and the nature of the business of the
Partnership and its Affiliates, or (B) the business of the Partnership and its
Affiliates or (iv) such partner becomes subject to an event described in Rule
506(d)(1)(i)-(vii) of Regulation D under the Securities Act.

“Code” means the Internal Revenue Code of 1986, as amended from time to time, or
any successor statute. Any reference herein to a particular provision of the
Code means, where appropriate, the corresponding provision in any successor
statute.

“Contingent” means subject to repurchase rights and/or other requirements.

The term “control” when used with reference to any person means the power to
direct the management and policies of such person, directly or indirectly, by or
through stock or other equity ownership, agency or otherwise, or pursuant to or
in connection with an agreement, arrangement or understanding (written or oral)
with one or more other persons by or through stock or other equity ownership,
agency or otherwise; and the terms “controlling” and “controlled” shall have
meanings correlative to the foregoing.

“Controlled Entity” when used with reference to another person means any person
controlled by such other person.

“Covered Person” has the meaning set forth in Section 3.5(a).

“Delaware Arbitration Act” has the meaning set forth in Section 7.1(d).

“Estate Planning Vehicle” has the meaning set forth in Section 6.3.

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.

“Final Event” means the death, Total Disability, Incompetence, Bankruptcy,
liquidation, dissolution or Withdrawal from the Partnership of any person who is
a Partner.

 

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“Firm Advances” means any capital contribution due to the Partnership by a
Partner that the General Partner or one of its Affiliates may in its sole
discretion advance to such Partner (including any additional Partner admitted to
the Partnership pursuant to Section 6.1 but excluding any Partners that are also
executive officers of Blackstone).

“Fiscal Year” means a calendar year, or any other period chosen by the General
Partner.

“Fund Agreements” means the collective reference to (i) the Limited Partnership
Agreement of BREIT Operating Partnership L.P., dated August 25, 2016 (as
amended, supplemented, modified or restated from time to time) and (ii) any
other limited partnership agreements, operating agreements and other governing
documentation of the Funds, in each case, as amended, supplemented or otherwise
modified from time to time.

“Funds” means the collective reference to (i) BREIT Operating Partnership L.P.
and (ii) any other investment vehicle for which the Partnership serves as the
direct or indirect general partner, special limited partner or other capacity
and, where the context requires, any parallel funds, managed accounts or
alternative investment vehicles related to the foregoing.

“Fund Net Income (Loss)” means any net income (loss) of the Partnership relating
to the Partnership’s interest in the Funds and any appreciation or depreciation
relating thereto, but not including (i) Other Net Income (Loss) or (ii) any net
income (loss) relating to the Performance Allocation. The General Partner may
designate separate categories of Fund Net Income (Loss) as it may determine in
its sole discretion, and may establish and allocate Profit Sharing Percentages
with respect to such separate categories accordingly.

“GAAP” has the meaning set forth in Section 5.1(c).

“General Partner” has the meaning set forth in the preamble hereto.

“Incompetence” means, with respect to any Partner, the determination by the
General Partner in its sole discretion, after consultation with a qualified
medical doctor, that such Partner is incompetent to manage his or her person or
his or her property.

“Interest” means a partnership interest (as defined in § 7-101(13) ) of the
Partnership Act) in the Partnership, including those which are held by a
Retaining Withdrawn Partner.

“Investor Note” means a promissory note of a Partner evidencing indebtedness
incurred by such Partner to the Lender or Guarantor for the purpose of financing
the purchase of an Interest in the Partnership and/or the amount of one or more
capital contributions to the Partnership, which is secured by such Interest and
all other Interests of such Partner in the Partnership (if any), in each case on
terms which were or are approved by the General Partner; provided, that such
promissory note may also evidence indebtedness relating to other interests of
such Partner in Blackstone Entities, in which case, such indebtedness shall also
be secured by such other interests of such Partner in such Blackstone Entities,
in each case on terms which were or are approved by the General Partner. Such
indebtedness shall be prepayable as provided in the Investor Note, any security
agreement related thereto and any applicable BE Agreements and any documentation
related thereto. References to “Investor Notes” herein may refer to multiple
loans made pursuant to such promissory note, whether made with respect to such
Partner’s Interest(s) in the Partnership or such Partner’s interests in other
Blackstone Entities, and references to an “Investor Note” refer to one such loan
as the context requires. In no way shall any indebtedness incurred to acquire
Interests in the Partnership, and, if applicable, interests in other Blackstone
Entities be considered part of the Investor Notes for purposes hereof if the
Lender or

 

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Guarantor is not the lender or guarantor with respect thereto.

“Lender or Guarantor” means Blackstone Holdings III L.P., in its capacity as
lender or guarantor under the Investor Notes, or any other Affiliate of the
Partnership that makes or guarantees loans to enable a Partner to acquire
Interests or other interests in Blackstone Entities.

“Limited Partner” means each of the parties listed as Limited Partners in the
books and records of the Partnership or any Person that has been admitted to the
Partnership as a substituted or additional Limited Partner in accordance with
the terms of this Agreement, each in its capacity as a limited partner of the
Partnership. For the avoidance of doubt, the term Limited Partner does not
include the General Partner or any Special Partners.

“LLC Act” has the meaning set forth in the preamble hereto.

“Losses” has the meaning set forth in Section 3.5(b).

“Majority in Interest of the Partners” on any date (a “vote date”) means one or
more persons who are Partners (including the General Partner but excluding
Nonvoting Special Partners) on the vote date and who, as of the last day of the
most recent accounting period ending on or prior to the vote date (or as of such
later date on or prior to the vote date selected by the General Partner), have
aggregate Profit Sharing Percentages representing at least a majority of the
Profit Sharing Percentages of all the persons who are Partners (including the
General Partner but excluding Nonvoting Special Partners) on the vote date.

“Net Income (Loss)” has the meaning set forth in Section 5.1(b).

“Non-Contingent” means generally not subject to repurchase rights or other
requirements.

“Nonvoting Special Partner” has the meaning set forth in Section 6.1(a).

“Other Net Income (Loss)” for any accounting period means the net income or net
loss of the Partnership for such accounting period as determined on an accrual
basis after deduction for expenses of the Partnership, in accordance with GAAP,
excluding (i) Fund Net Income (Loss) and (ii) any net income (loss) relating to
the Performance Allocation. The General Partner may designate separate
categories of Other Net Income (Loss) as it may determine in its sole
discretion, and may establish and allocate Profit Sharing Percentages with
respect to such separate categories accordingly.

“Partner” means any person who is a partner of the Partnership, including the
Limited Partners, the General Partner and the Special Partners. Except as
otherwise specifically provided herein, no group of Partners, including the
Special Partners and any group of Partners in the same Partner Category, shall
have any right to vote as a class on any matter relating to the Partnership,
including, but not limited to, any merger, reorganization, dissolution or
liquidation.

“Partnership Act” means the Delaware Revised Uniform Limited Partnership Act, 6
Del. C. § 17-101, et seq., as it may be amended from time to time

“Partnership Representative” has the meaning set forth in Section 6.7(c).

“Pass-Thru Partner” has the meaning set forth in Section 6.7(c).

 

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“Performance Allocation” means the performance allocations of net capital
appreciation or net profits allocated by the Funds to the Partnership pursuant
to the applicable Fund Agreements. The General Partner may designate separate
categories of net income (loss) relating to the Performance Allocation as it may
determine in its sole discretion, and may establish and allocate Profit Sharing
Percentages with respect to such separate categories accordingly.

“Person” means any individual, partnership, joint venture, corporation, limited
liability company, unincorporated organization or association, trust (including
the trustees thereof in their capacity as such), government (or agency or
subdivision thereof), governmental entity or other entity.

“Prime Rate” means the rate of interest per annum publicly announced from time
to time by JPMorgan Chase Bank, N.A. (“JPM”) as its prime rate or, if JPM fails
to publish such rate, the equivalent rate as published by another national bank.

“Profit Sharing Percentage” means, with respect to any Partner, such Partner’s
percentage interest in Net Income (Loss) or any category thereof (including,
without limitation, Fund Net Income (Loss), Other Net Income (Loss) and the
Performance Allocation), as determined by the General Partner and set forth in
the books and records of the Partnership, as such Profit Sharing Percentage may
be modified from time to time in accordance herewith. Separate Profit Sharing
Percentages may be established for each Partner with respect to each separate
category of Net Income (Loss).

“Positive Basis” has the meaning set forth in Section 6.7(b).

“Positive Basis Partner” has the meaning set forth in Section 6.7(b).

“Regulations” means the U.S. Treasury regulations promulgated under the Code.

“Repurchase Period” has the meaning set forth in Section 5.7(c).

“Retaining Withdrawn Partner” means a Withdrawn Partner who has retained an
Interest in the Partnership following such Withdrawn Partner’s Withdrawal Date.
A Retaining Withdrawn Partner shall be considered a Nonvoting Special Partner
for all purposes hereof.

“Securities Act” means the U.S. Securities Act of 1933, as amended from time to
time, or any successor statute.

“Settlement Date” has the meaning set forth in Section 6.5(a).

“Special Partner” means any person shown in the books and records of the
Partnership as a Special Partner of the Partnership, including any Nonvoting
Special Partner.

“Tax Advances” has the meaning set forth in Section 6.7(d).

“TM” has the meaning set forth in Section 7.2.

“Total Disability” means the inability of a Limited Partner substantially to
perform the services required of such Limited Partner (in its capacity as such
or in any other capacity with respect to any Affiliate of the Partnership) for a
period of six consecutive months by reason of physical or mental illness or
incapacity and whether arising out of sickness, accident or otherwise.

 

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“Withdraw” or “Withdrawal” with respect to a Partner means a Partner ceasing to
be a partner of the Partnership (except as a Retaining Withdrawn Partner) for
any reason (including death, Total Disability, Incompetence, removal,
resignation or retirement, whether such is voluntary or involuntary) unless the
context shall limit the type of withdrawal to a specific reason and “Withdrawn”
with respect to a Partner means, as aforesaid, a Partner who has ceased to be a
partner of the Partnership (except as a Retaining Withdrawn Partner).

“Withdrawal Date” means, with respect to any Withdrawn Partner, the date on
which such Withdrawn Partner ceases to be a Partner of the Partnership.

“Withdrawn Partner” means a Partner whose Interest in the Partnership has been
terminated for any reason including the occurrence of an event specified in
Section 6.2, and shall include, unless the context requires otherwise, the
estate or legal representatives of any such Partner.

Section 1.2 Terms Generally. The definitions in Section 1.1 shall apply equally
to both the singular and plural forms of the terms defined. Whenever the context
may require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The term “person” includes individuals, partnerships (including
limited liability partnerships), companies (including limited liability
companies), joint ventures, corporations, trusts, governments (or agencies or
political subdivisions thereof) and other associations and entities. The words
“include”, “includes” and “including” shall be deemed to be followed by the
phrase “without limitation”.

ARTICLE II

GENERAL PROVISIONS

Section 2.1 Conversion; Formation. Effective as of January 1, 2018, to the
maximum extent permitted by law (i) all of the organizational documents of the
Company (including the certificate of formation and the LLC Agreement of the
Company) are replaced and superseded in their entirety by this Agreement in
respect of all periods beginning on or after the January 1, 2018, (ii) all of
the limited liability company interests in the Company issued and outstanding
immediately prior to the January 1, 2018 are converted to all of the Interests
in the Partnership, (iii) upon execution of a counterpart signature page to this
Agreement Blackstone Holdings III L.P., a Québec société en commandite, is
hereby admitted to the Partnership as the general partner of the Partnership and
shall have no economic Interest or other interest in the Partnership, and
(iv) upon its admission to the Partnership in accordance with the terms hereof
each Limited Partner is bound to this Agreement.

Section 2.2 General Partner, Limited Partner, Special Partner. The Partners may
be General Partners, Limited Partners or Special Partners. The General Partner
as of the date hereof is Blackstone Holdings III L.P. and the Limited Partners
as of the date hereof are those persons shown as Limited Partners in the books
and records of the Partnership, and the Special Partners as of the date hereof
are persons shown as Special Partners on the signature pages hereof.

Section 2.3 Continuation; Name; Foreign Jurisdictions. The Partnership is BREIT
Special Limited Partner L.P. The certificate of limited partnership of the
Partnership may be amended and/or restated from time to time by the General
Partner. The General Partner is further authorized to execute and deliver and
file any other certificates (and any amendments and/or restatements thereof)
necessary for the Partnership to qualify to do business in a jurisdiction in
which the Partnership may wish to conduct business.

 

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Section 2.4 Term. The term of the Partnership shall continue unless and until
the Partnership is dissolved as provided herein.

Section 2.5 Purpose; Powers.

(a) The purpose of the Partnership shall be, directly or indirectly through
subsidiaries or Affiliates, (i) to serve as a direct or indirect general
partner, special limited partner and/or limited partner of the Funds or other
partnerships and/or as a member of one or more limited liability companies,
(ii) to invest in, and acquire, directly or indirectly, partnership interests,
limited liability company interests and/or other equity interests in, and/or
securities of, any one or more limited partnerships, limited liability companies
and/or other entities, and/or receive allocations, fees, distributions and other
payments, directly or indirectly, from any one more of such limited
partnerships, limited liability companies and/or other entities, in each case as
the General Partner shall determine, (iii) to carry on such other businesses,
perform such other services and make such other investments as are deemed
desirable by the General Partner and as are permitted under the Partnership Act
and the applicable Fund Agreements, in each case as the same may be amended,
supplemented, restated or otherwise modified from time to time; (iv) any other
lawful purpose, and (v) to do all things necessary, desirable, convenient and/or
incidental thereto.

(b) In furtherance of its purpose, the Partnership shall have all powers
necessary, suitable or convenient for the accomplishment of its purposes, alone
or with others, as principal or agent, including the following:

(i) to be and become a direct or indirect general or limited partner of
partnerships, a member of limited liability companies, a holder of common and
preferred stock of corporations and/or an investor in the foregoing entities or
other entities, in connection with the making of investments or the acquisition,
holding or disposition of investments or other property or as otherwise deemed
appropriate by the General Partner in the conduct of the Partnership’s business,
and to take any action in connection therewith;

(ii) do any and all acts on behalf of the Funds (subject to applicable Fund
Agreements) and exercise all rights and remedies thereof with respect to its
interest in any Person, firm, corporation or other entity, including, without
limitation, the voting or lending of investments, participation in arrangements
with creditors, the institution and settlement or compromise of suits and
administrative proceedings and other similar matters;

(iii) to acquire and invest in general partner or limited partner interests, in
limited liability company interests, in common and preferred stock of
corporations and/or in other interests in or obligations of the foregoing
entities or other entities and in investments and securities or other property
or direct or indirect interests therein, whether such investments and securities
or other property are readily marketable or not, and to receive, hold, sell,
dispose of or otherwise transfer any such partner interests, limited liability
company interests, stock, interests, obligations, investments or securities or
other property and any dividends and distributions thereon and to purchase and
sell, on margin, and be long or short, futures contracts and to purchase and
sell, and be long or short, options on futures contracts;

(iv) to buy, sell and otherwise acquire investments, whether such investments
are readily marketable or not;

(v) to invest and reinvest the cash assets of the Partnership in money-market or
other short term investments;

 

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(vi) to hold, receive, mortgage, pledge, grant security interests over, lease,
transfer, exchange or otherwise dispose of, grant options with respect to, and
otherwise deal in and exercise all rights, powers, privileges and other
incidents of ownership or possession with respect to, all property held or owned
by the Partnership;

(vii) to borrow or raise money from time to time and to issue promissory notes,
drafts, bills of exchange, warrants, bonds, debentures and other negotiable and
non-negotiable instruments and evidences of indebtedness, to secure payment of
the principal of any such indebtedness and the interest thereon by mortgage,
pledge, conveyance or assignment in trust of, or the granting of a security
interest in, the whole or any part of the property of the Partnership, whether
at the time owned or thereafter acquired, to guarantee the obligations of others
and to buy, sell, pledge or otherwise dispose of any such instrument or evidence
of indebtedness;

(viii) make, in its sole discretion, any and all elections for U.S. federal,
state, local and non-U.S. tax purposes;

(ix) to lend any of its property or funds, either with or without security, at
any legal rate of interest or without interest;

(x) to have and maintain one or more offices within or without the State of
Delaware, and in connection therewith, to rent or acquire office space, engage
personnel and compensate them and do such other acts and things as may be
advisable or necessary in connection with the maintenance of such office or
offices;

(xi) to open, maintain and close accounts, including margin accounts, with
brokers;

(xii) to open, maintain and close bank accounts and draw checks and other orders
for the payment of moneys;

(xiii) to engage accountants, auditors, custodians, investment advisers,
attorneys and any and all other agents and assistants, both professional and
nonprofessional, and to compensate any of them as may be necessary or advisable;

(xiv) to form or cause to be formed and to own the stock of one or more
corporations, whether foreign or domestic, to form or cause to be formed and to
participate in partnerships and joint ventures, whether foreign or domestic, and
to form or cause to be formed and be a member or manager or both of one or more
limited liability companies;

(xv) to enter into, make and perform all contracts, agreements and other
undertakings as may be necessary, convenient or advisable or incident to
carrying out its purposes;

(xvi) to sue and be sued, to prosecute, settle or compromise all claims against
third parties, to compromise, settle or accept judgment to claims against the
Partnership, and to execute all documents and make all representations,
admissions and waivers in connection therewith;

(xvii) to distribute, subject to the terms of this Agreement, at any time and
from time to time to the Partners cash or investments or other property of the
Partnership, or any combination thereof; and

 

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(xviii) to take such other actions necessary, desirable, convenient or
incidental thereto and to engage in such other businesses as may be permitted
under Delaware and other applicable law.

Section 2.6 Registered Office; Place of Business; Registered Agent. The
Partnership shall maintain an office and principal place of business at 345 Park
Avenue, New York, New York 10154 or such other place or places as the General
Partner may designate from time to time. The Partnership shall maintain a
registered office at c/o Intertrust Corporate Services Delaware Ltd., 200
Bellevue Parkway, Suite 2010, Bellevue Park Corporate Center, Wilmington,
Delaware 19809. The name and address of the registered agent of the Partnership
for service of process on the Partnership in the State of Delaware shall be
Intertrust Corporate Services Delaware, Ltd., 200 Bellevue Parkway, Suite 210,
Bellevue Park Corporate Center, Wilmington, Delaware 19809. The General Partner
may from time to time change the registered agent or office by an amendment to
the certificate of limited partnership of the Partnership.

ARTICLE III

MANAGEMENT

Section 3.1 General Partner.

(a) Blackstone Holdings III L.P. is the General Partner as of the date hereof.
The General Partner shall cease to be the General Partner only if it
(i) Withdraws from the Partnership for any reason (ii) consents in its sole
discretion to resign as the General Partner or (iii) a Final Event with respect
to it occurs. The General Partner may not be removed without its consent. There
may be one or more General Partners. In the event that one or more other General
Partners is admitted to the Partnership as such, all references herein to the
“General Partner” in the singular form shall be deemed to also refer to such
other General Partners as may be appropriate. The relative rights and
responsibilities of such General Partners will be as agreed upon from time to
time between them.

(b) Upon the Withdrawal from the Partnership or voluntary resignation of the
last remaining General Partner, all of the powers formerly vested therein
pursuant to this Agreement and the Partnership Act shall be exercised by a
Majority in Interest of the Partners.

Section 3.2 Partner Voting, etc.

(a) Except as otherwise expressly provided herein and except as may be expressly
required by the Partnership Act, Partners (including Special Partners), other
than General Partners, as such shall have no right to, and shall not, take part
in the management or control of the Partnership’s business or act for or bind
the Partnership, and shall have only the rights and powers granted to Partners
of the applicable class herein.

(b) To the extent a Partner is entitled to vote with respect to any matter
relating to the Partnership, such Partner shall not be obligated to abstain from
voting on any matter (or vote in any particular manner) because of any interest
(or conflict of interest) of such Partner (or any Affiliate thereof) in such
matter.

(c) Meetings of the Partners may be called only by the General Partner.

(d) Notwithstanding any other provision of this Agreement, any Limited Partner
or Withdrawn Partner that fails to respond to a notice provided by the General
Partner requesting the

 

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consent, approval or vote (including, without limitation, with respect to any
amendments pursuant to Section 7.14) of such Limited Partner or Withdrawn
Partner within 14 days after such notice is sent to such Limited Partner or
Withdrawn Partner shall be deemed to have given its affirmative consent or
approval thereto.

Section 3.3 Management. (a) The management, control and operation of the
Partnership and the formulation and execution of business and investment policy
shall be vested in the General Partner. The General Partner shall have full
control over the business and affairs of the Partnership, and shall, in its
discretion, exercise all powers necessary and convenient for the purposes of the
Partnership, including those enumerated in Section 2.5, on behalf and in the
name of the Partnership. All decisions and determinations (howsoever described
herein) to be made by the General Partner pursuant to this Agreement shall be
made in its discretion, subject only to the express terms and conditions of this
Agreement (including Section 7.4).

(b) Notwithstanding any provision of this Agreement to the contrary, the
Partnership is hereby authorized, without the need for any further act, vote or
consent of any Partner, (i) to execute and deliver, and to perform the
Partnership’s obligations under, each agreement of the Partnership (including,
without limitation, the applicable Fund Agreements), including, without
limitation, serving as the managing member, general partner, special limited
partner or limited partner, as the case may be, of the Funds, (ii) to execute
and deliver the applicable Fund Agreements, as amended, restated and/or
supplemented, and to perform the Partnership’s obligations, and to cause the
Funds (subject to the applicable Fund Agreements) to perform their respective
obligations, under the applicable Fund Agreements, (iii) to execute and deliver,
and to perform the Partnership’s obligations, under the governing agreements of
any other partnership, limited liability company, other company, corporation or
other entity (each a “Partnership Affiliate”) of which the Partnership is to
become a general partner or limited partner, member, shareholder or other equity
interest owner, including, without limitation, serving as a general partner or
limited partner, member, shareholder or other equity interest owner of each
Partnership Affiliate and (iv) to take any action, in the applicable capacity,
contemplated by or arising out of any applicable Fund Agreements.

(c) The General Partner and any other person designated by the General Partner,
each acting individually, is hereby authorized and empowered, as an authorized
signatory of the Partnership (the General Partner hereby authorizing and
ratifying any of the following actions):

(i) to execute and deliver and/or file (in the name and on behalf of the
Partnership) any agreement of the Partnership (including, without limitation,
the applicable Fund Agreements) or of the Funds (including, without limitation,
the applicable Fund Agreements) and any amendments, restatements and/or
supplements thereof, the certificate of limited partnership of the Partnership
(and any amendments, restatements and/or supplements of any of the foregoing)
and any other certificates, notices, applications and other documents (and any
amendments, restatements and/or supplements thereof) to be filed with any
government or governmental or regulatory body, including, without limitation,
any such document that may be necessary for the Partnership or the Funds to
qualify to do business in a jurisdiction in which the Partnership or the Funds
desires to do business; or

(ii) to prepare or cause to be prepared, and to sign, execute and deliver and/or
file (including any such action, directly or indirectly through one or more
other entities, in the name and on behalf of the Partnership and/or in the name
and on behalf of the Partnership), (A) such documents, instruments, certificates
and agreements as may be necessary or desirable in furtherance of the
Partnership’s or the Funds’ purposes, (B) any certificates, forms, notices,
applications and other documents to be filed with any government or governmental
or regulatory body on behalf of the Partnership or the Funds, (C) any
certificates, forms, notices, applications and other documents that may

 

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be necessary or advisable in connection with any bank account of the Partnership
or the Funds, and all checks, notes, drafts and other documents of the Funds
that may be required in connection with any such bank account or any banking
facilities or services that may be utilized by the Partnership or the Funds,
(D) resolutions with respect to any of the foregoing matters (which resolutions,
when executed by any person authorized as provided in this Section 3.3(c), each
acting individually, shall be deemed to have been adopted by the Partners, the
Partnership or the Funds, as applicable, for all purposes), and (E) any
amendments, restatements and/or supplements of any of the foregoing.

The authority granted to any person (other than the General Partner) in this
Section 3.3(c) may be revoked at any time by the General Partner by an
instrument in writing signed by the General Partner.

Section 3.4 Responsibilities of Partners.

(a) Unless otherwise determined by the General Partner in a particular case,
each Limited Partner (other than Special Partner) shall devote substantially all
his or her time and attention to the businesses of the Partnership and its
Affiliates, and each Special Partner shall not be required to devote any time or
attention to the businesses of the Partnership or its Affiliates.

(b) All outside business or investment activities of the Partners (including
outside directorships or trusteeships) shall be subject to such rules and
regulations as are established by the General Partner from time to time.

(c) The General Partner may from time to time establish such other rules and
regulations applicable to Partners or other employees as the General Partner
deems appropriate, including rules governing the authority of Partners or other
employees to bind the Partnership to financial commitments or other obligations.

Section 3.5 Exculpation and Indemnification.

(a) Liability to Partners. Notwithstanding any other provision of this
Agreement, whether express or implied, to the fullest extent permitted by law,
no Partner nor any of such Partner’s representatives, agents or advisors nor any
partner, member, officer, employee, representative, agent or advisor of the
Partnership or any of its Affiliates (individually, a “Covered Person” and,
collectively, the “Covered Persons”) shall be liable to the Partnership or any
other Partner for any act or omission (in relation to the Partnership, this
Agreement, any related document or any transaction or investment contemplated
hereby or thereby) taken or omitted by a Covered Person (other than any act or
omission constituting Cause) unless there is a final and non-appealable judicial
determination and/or determination of an arbitrator that such Covered Person did
not act in good faith. Each Covered Person shall be entitled to rely in good
faith on the advice of legal counsel to the Partnership, accountants and other
experts or professional advisors, and no action taken by any Covered Person in
reliance on such advice shall in any event subject such person to any liability
to any Partner or the Partnership. To the extent that, at law or in equity, a
Partner has duties (including fiduciary duties) and liabilities relating thereto
to the Partnership or to another Partner, to the fullest extent permitted by
law, such Partner acting under this Agreement shall not be liable to the
Partnership or to any such other Partner for its good faith reliance on the
provisions of this Agreement. The provisions of this Agreement, to the extent
that they expand or restrict the duties and liabilities of a Partner otherwise
existing at law or in equity, are agreed by the Partners, to the fullest extent
permitted by law, to modify to that extent such other duties and liabilities of
such Partner. To the fullest extent permitted by law, the parties hereto agree
that the General Partner shall be held to have acted in good faith for the
purposes of this Agreement and its duties under the Partnership Act if it
believes that it has acted honestly and in accordance with the specific terms of
this Agreement.

 

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(b) Indemnification. (i) To the fullest extent permitted by law, the Partnership
shall indemnify and hold harmless (but only to the extent of the Partnership’s
assets (including, without limitation, the remaining capital commitments of the
Partners) each Covered Person from and against any and all claims, damages,
losses, costs, expenses and liabilities (including, without limitation, amounts
paid in satisfaction of judgments, in compromises and settlements, as fines and
penalties and legal or other costs and reasonable expenses of investigating or
defending against any claim or alleged claim), joint and several, of any nature
whatsoever, known or unknown, liquidated or unliquidated (collectively, for
purposes of this Section 3.5, “Losses”), arising from any and all claims,
demands, actions, suits or proceedings, civil, criminal, administrative or
investigative, in which the Covered Person may be involved, or threatened to be
involved, as a party or otherwise, by reason of such Covered Person’s management
of the affairs of the Partnership or which relate to or arise out of or in
connection with the Partnership, its property, its business or affairs (other
than claims, demands, actions, suits or proceedings, civil, criminal,
administrative or investigative, arising out of any act or omission of such
Covered Person constituting Cause); provided, that a Covered Person shall not be
entitled to indemnification under this Section 3.5(b) with respect to any claim,
issue or matter if there is a final and non-appealable judicial determination
and/or determination of an arbitrator that such Covered Person did not act in
good faith; provided further, that if such Covered Person is a Partner or a
Withdrawn Partner, such Covered Person shall bear its share of such Losses in
accordance with such Covered Person’s Profit Sharing Percentage in the
Partnership as of the time of the actions or omissions that gave rise to such
Losses. To the fullest extent permitted by law, expenses (including legal fees)
incurred by a Covered Person (including, without limitation, the General
Partner) in defending any claim, demand, action, suit or proceeding may, with
the approval of the General Partner, from time to time, be advanced by the
Partnership prior to the final disposition of such claim, demand, action, suit
or proceeding upon receipt by the Partnership of a written undertaking by or on
behalf of the Covered Person to repay such amount to the extent that it shall be
subsequently determined that the Covered Person is not entitled to be
indemnified as authorized in this Section 3.5(b), and the Partnership and its
Affiliates shall have a continuing right of offset against such Covered Person’s
interests/investments in the Partnership and such Affiliates and shall have the
right to withhold amounts otherwise distributable to such Covered Person to
satisfy such repayment obligation. If a Partner institutes litigation against a
Covered Person which gives rise to an indemnity obligation hereunder, such
Partner shall be responsible, up to the amount of such Partner’s Interests and
remaining capital commitment, for such Partner’s pro rata share of the
Partnership’s expenses related to such indemnity obligation, as determined by
the General Partner. The Partnership may purchase insurance, to the extent
available at reasonable cost, to cover losses, claims, damages or liabilities
covered by the foregoing indemnification provisions. Partners will not be
personally obligated with respect to indemnification pursuant to this
Section 3.5(b). The General Partner shall have the authority to enter into
separate agreements with any Covered Person in order to give effect to the
obligations to indemnify pursuant to this Section 3.5(b).

(ii) (A) Notwithstanding anything to the contrary herein, for greater certainty,
it is understood and/or agreed that the Partnership’s obligations hereunder are
not intended to render the Partnership as a primary indemnitor for purposes of
the indemnification, advancement of expenses and related provisions under
applicable law governing the Funds and/or a particular portfolio entity through
which an investment is indirectly held. It is further understood and/or agreed
that a Covered Person shall first seek to be so indemnified and have such
expenses advanced in the following order of priority (to the extent available
and permitted pursuant to the terms of the applicable Fund Agreement and
applicable insurance policies): first, out of proceeds available in respect of
applicable insurance policies maintained by the applicable portfolio entity
and/or the Funds; second, by the applicable portfolio entity through which such
investment is indirectly held and third, by the Funds (only to the extent the
foregoing sources have been exhausted).

 

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(B) The Partnership’s obligation, if any, to indemnify or advance expenses to
any Covered Person shall be reduced by any amount that such Covered Person may
collect as indemnification or advancement from the Funds and/or the applicable
portfolio entity (including by virtue of any applicable insurance policies
maintained thereby), and to the extent the Partnership (or any Affiliate
thereof) pays or causes to be paid any amounts that should have been paid by the
Funds and/or the applicable portfolio entity (including by virtue of any
applicable insurance policies maintained thereby), it is agreed among the
Partners that the Partnership shall have a subrogation claim against the Funds
and/or such portfolio entity in respect of such advancement or payments (to the
extent available and permitted pursuant to the terms of the applicable Fund
Agreement and applicable insurance policies). The General Partner and the
Partnership shall be specifically empowered to structure any such advancement or
payment as a loan or other arrangement (except for a loan to an executive
officer of Blackstone, which shall not be permitted) as the General Partner may
determine necessary or advisable to give effect to or otherwise implement the
foregoing.

Section 3.6 Representations of Partners. (a) Each Limited Partner and Special
Partner by execution of this Agreement (or by otherwise becoming bound by the
terms and conditions hereof as provided herein or in the Partnership Act)
represents and warrants to every other Partner and to the Partnership, except as
may be waived by the General Partner, that such Partner is acquiring each of
such Partner’s Interests for such Partner’s own account for investment and not
with a view to resell or distribute the same or any part thereof, and that no
other person has any interest in any such Interest or in the rights of such
Partner hereunder; provided, that a Partner may choose to make transfers for
estate and charitable planning purposes (pursuant to Section 6.3(a) and
otherwise in accordance with the terms hereof). Each Limited Partner and Special
Partner represents and warrants that he or she understands that the Interests
have not been registered under the Securities Act, and therefore such Interests
may not be resold without registration under such act or exemption from such
registration, and that accordingly such Partner must bear the economic risk of
an investment in the Partnership for an indefinite period of time. Each Limited
Partner and Special Partner represents and warrants, unless otherwise agreed to
by the General Partner in writing, that such Partner is both an “accredited
investor” within the meaning of Rule 501 of Regulation D under the Securities
Act (an “Accredited Investor”), and a “qualified purchaser” or a “knowledgeable
employee” within the meaning of the Investment Company Act (and the rules and
regulations promulgated thereby) (a “Qualified Purchaser”). Each Limited Partner
and Special Partner represents that such Partner has such knowledge and
experience in financial and business matters, that such Partner is capable of
evaluating the merits and risks of an investment in the Partnership, and that he
or she is able to bear the economic risk of such investment. Each Limited
Partner and Special Partner represents that such Partner’s overall commitment to
the Partnership and other investments which are not readily marketable is not
disproportionate to the Partner’s net worth and the Partner has no need for
liquidity in the Partner’s investment in Interests. Each Limited Partner and
Special Partner represents that to the full satisfaction of the Partner, the
Partner has been furnished any materials that such Partner has requested
relating to the Partnership and the offering of Interests and has been afforded
the opportunity to ask questions of representatives of the Partnership
concerning the terms and conditions of the offering of Interests and any matters
pertaining thereto and to obtain any other additional information relating
thereto. Each Limited Partner and Special Partner represents that the Partner
has consulted to the extent deemed appropriate by the Partner with the Partner’s
own advisors as to the financial, tax, legal and related matters concerning an
investment in Interests and on that basis believes that an investment in the
Interests is suitable and appropriate for the Partner.

(b) Each Limited Partner and Special Partner agrees that the representations and
warranties contained in paragraph (a) above shall be true and correct as of any
date that such Partner (1) makes a capital contribution to the Partnership
(whether as a result of Firm Advances made to such Partner or otherwise) with
respect to any investment, and such Partner hereby agrees that such capital

 

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contribution shall serve as confirmation thereof and/or (2) repays any portion
of the principal amount of a Firm Advance, and such Partner hereby agrees that
such repayment shall serve as confirmation thereof.

Section 3.7 Tax Representation and Further Assurances.

(a) Each Limited Partner and Special Partner, upon the request of the General
Partner, agrees to perform all further acts and to execute, acknowledge and
deliver any documents that may be reasonably necessary to comply with the
General Partner’s or the Partnership’s obligations under applicable law or to
carry out the provisions of this Agreement.

(b) Each Limited Partner and Special Partner certifies that (A) if the Limited
Partner or Special Partner is a United States person (as defined in the Code)
(x) (i) the Limited Partner or Special Partner’s name, social security number
(or, if applicable, employer identification number) and address provided to the
Partnership and its Affiliates pursuant to an IRS Form W 9, Request for Taxpayer
Identification Number Certification (“W-9”) or otherwise are correct and
(ii) the Limited Partner or Special Partner will complete and return a W-9 and
(y) (i) the Limited Partner or Special Partner is a United States person (as
defined in the Code) and (ii) the Limited Partner or Special Partner will notify
the Partnership within 60 days of a change to foreign (non-United States) status
or (B) if the Limited Partner or Special Partner is not a United States person
(as defined in the Code) (x) (i) the information on the completed IRS Form
W-8BEN, Certificate of Foreign Status of Beneficial Owner for United States Tax
Withholding and Reporting (Individuals) (“W-8BEN”), IRS Form W-8BEN-E,
Certificate of Status of Beneficial Owner for United States Tax Withholding and
Reporting (Entities) (“W-8BEN-E”), or other applicable form, including but not
limited to IRS Form W-8IMY, Certificate of Foreign Intermediary, Foreign
Flow-Through Entity, or Certain U.S. Branches for United States Tax Withholding
and Reporting (“W-8IMY”), or otherwise is correct and (ii) the Limited Partner
or Special Partner will complete and return the applicable IRS form, including
but not limited to a W-8BEN, W-8BEN-E or W-8IMY, and (y) (i) the Limited Partner
or Special Partner is not a United States person (as defined in the Code) and
(ii) the Limited Partner or Special Partner will notify the Partnership within
60 days of any change of such status. Each Limited Partner and Special Partner
agrees to provide such cooperation and assistance, including but not limited to
properly executing and providing to the Partnership in a timely manner any tax
or other documentation or information that may be reasonably requested by the
Partnership or the General Partner.

(c) Each Limited Partner and Special Partner acknowledges and agrees that the
Partnership and the General Partner may release confidential information or
other information about the Limited Partner or Special Partner or related to
such Limited Partner or Special Partner’s investment in the Partnership if the
Partnership or the General Partner, in its or their sole discretion, determines
that such disclosure is required by applicable law or regulation or in order to
comply for an exception from, or reduced tax rate of, tax or other tax benefit.
Any such disclosure shall not be treated as a breach of any restriction upon the
disclosure of information imposed on any such person by law or otherwise, and a
Limited Partner or Special Partner shall have no claim against the Partnership,
the General Partner or any of their Affiliates for any form of damages or
liability as a result of actions taken by the foregoing in order to comply with
any disclosure obligations that the foregoing reasonably believe are required by
law, regulation or otherwise.

(d) Each Limited Partner and Special Partner acknowledges and agrees that if it
provides information that is in anyway materially misleading, or if it fails to
provide the Partnership or its agents with any information requested hereunder,
in either case in order to satisfy the Partnership’s obligations, the General
Partner reserves the right to take any action and pursue any remedies at its
disposal, including (i) requiring such Limited Partner or Special Partner to
Withdraw for Cause and (ii) withholding or deducting any costs caused by such
Limited Partner’s action or inaction from amounts otherwise distributable to
such Limited Partner or Special Partner from the Partnership and its Affiliates.

 

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ARTICLE IV

CAPITAL OF THE PARTNERSHIP

Section 4.1 Capital Contributions by Partners.

(a) Each Limited Partner may be required to make capital contributions to the
Partnership at such times and in such amounts as may be determined by the
General Partner from time to time or as may be mutually agreed (including, where
applicable, as set forth in such Limited Partner’s Admission Letter). Special
Partners shall not be required to make capital contributions to the Partnership
except as specifically set forth in this Agreement or as they otherwise agree;
provided, that the General Partner and any Special Partner may agree from time
to time that such Special Partner shall make an additional capital contribution
to the Partnership.

(b) Each capital contribution by a Partner shall be credited to the appropriate
Capital Account (or sub account) of such Partner in accordance with Section 5.2
and maintained in the books and records of the Partnership.

(c) The General Partner may elect on a case-by-case basis with respect to any
Partner (including any additional Partner admitted to the Partnership pursuant
to Section 6.1 but excluding any Partner that is also an executive officer of
Blackstone) to (i) cause the Partnership to loan to any such Partner the amount
of any capital contribution to the Partnership by such Partner on terms
determined by the General Partner, (ii) permit any such Partner to make a
required capital contribution to the Partnership in installments on terms
determined by the General Partner or (iii) permit any such Partner to incur
indebtedness to the Lender or Guarantor for the purpose of financing the
purchase of an Interest in the Partnership and/or the amount of one or more
capital contributions to the Partnership, which indebtedness shall be evidenced
by an Investor Note and secured by such Interest, all other Interests of such
Partner in the Partnership (if any) and, if applicable, interests of such
Partner in any Blackstone Collateral Entities, in each case on terms which were
or are approved by the General Partner.

Section 4.2 Interest. There shall be no interest on the balances of the
Partners’ Capital Accounts.

Section 4.3 Partial Withdrawals of Capital. Each Partner may make partial
withdrawals in respect of such Partner’s Capital Account(s) in such amounts and
at such times as may be permitted by the General Partner from time to time.
Payments with respect to any such partial withdrawals will be made at such times
and in cash or in kind as may be determined by the General Partner.

ARTICLE V

PARTICIPATION IN PROFITS AND LOSSES

Section 5.1 General Accounting Matters.

(a) Net Income (Loss) shall be determined by the General Partner at the end of
each accounting period and shall be allocated as described in Section 5.4.

(b) “Net Income (Loss)” means, with respect to any accounting period, the sum
of: (i) Fund Net Income (Loss) for such period, (ii) Other Net Income (Loss) for
such period, and (iii) any net income (loss) relating to the Performance
Allocation (including any property received from each Fund

 

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with respect thereto) for such period.    The General Partner may from time to
time (i) establish additional separate categories of Net Income (Loss) and/or
subcategories within any one or more categories of Net Income (Loss) (each of
which subcategories for purposes of this Agreement shall also be deemed a
separate “category” of Net Income (Loss)) with respect to the Partnership as it
may determine and (ii) calculate and allocate Net Income (Loss) for each such
category on a separate basis.

(c) Net Income (Loss) with respect to any accounting period shall be determined
in accordance with the accounting method used by the Partnership for U.S.
federal income tax purposes with the following adjustments: (i) any income of
the Partnership that is exempt from U.S. federal income taxation and not
otherwise taken into account in computing Net Income (Loss) shall be added to
such taxable income or loss; (ii) if any asset has a value in the books of the
Partnership that differs from its adjusted tax basis for U.S. federal income tax
purposes, any depreciation, amortization or gain resulting from a disposition of
such asset shall be calculated with reference to such value; (iii) upon an
adjustment to the value of any asset in the books of the Partnership pursuant to
Regulation Section 1.704-1 (b) (2), the amount of the adjustment shall be
included as gain or loss in computing such taxable income or loss; (iv) any
expenditures of the Partnership not deductible in computing taxable income or
loss, not properly capitalizable and not otherwise taken into account in
computing Net Income (Loss) pursuant to this definition shall be treated as
deductible items; (v) any income that is payable to Partnership employees in
respect of “phantom interests” awarded by the General Partner to employees shall
be included as an expense in the calculation of Net Income (Loss), and
(vi) items of income and expense (including interest income and overhead and
other indirect expenses) of the Partnership, General Partner and other
Affiliates of the Partnership shall be allocated among the Partnership, General
Partner and such Affiliates as determined by the General Partner. Any
adjustments to Net Income (Loss) by the General Partner, including adjustments
for items of income accrued but not yet received, unrealized gains, items of
expense accrued but not yet paid, unrealized losses, reserves (including
reserves for taxes, bad debts, actual or threatened litigation, or any other
expenses, contingencies or obligations) and other appropriate items shall be
made in accordance with U.S. generally accepted accounting principles (“GAAP”);
provided, that the General Partner shall not be required to make any such
adjustments; provided further, that the General Partner may elect from time to
time to calculate and allocate Net Income (Loss) attributable to any item of
income or expense or any investment of the Partnership on a basis separate from
the Partnership’s other business.

(d) An accounting period shall be a Fiscal Year, except that, at the option of
the General Partner, an accounting period will terminate and a new accounting
period will begin on the admission date of an additional Partner or the
Withdrawal Date of a Withdrawn Partner, if any such date is not the first day of
a Fiscal Year, or on any other date determined by the General Partner in its
sole discretion. If any event referred to in the preceding sentence occurs and
the General Partner does not elect to terminate an accounting period and begin a
new accounting period, then the General Partner may make such adjustments as its
deems appropriate to the Partners’ Profit Sharing Percentages for the accounting
period in which such event occurs (prior to any allocations or adjustments to
Profit Sharing Percentages pursuant to Section 5.3) to reflect the Partners’
average Profit Sharing Percentages during such accounting period.

(e) In establishing Profit Sharing Percentages pursuant to Section 5.3, the
General Partner may consider such factors as it deems appropriate in its sole
discretion.

(f) All determinations, valuations and other matters of judgment required to be
made for accounting purposes under this Agreement shall be made by the General
Partner and approved by the Partnership’s independent accountants. Such approved
determinations, valuations and other accounting matters shall be conclusive and
binding on all Partners, all Withdrawn Partners, their successors, heirs,
estates or legal representatives and any other person, and to the fullest extent
permitted

 

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by law, no such person shall have the right to an accounting or an appraisal of
the assets of the Partnership or any successor thereto.

Section 5.2 Capital Accounts.

(a) There shall be established for each Partner in the books of the Partnership,
to the extent and at such times as may be appropriate, one or more Capital
Accounts (or sub accounts) as the General Partner may deem to be appropriate for
purposes of accounting for such Partner’s interests in the capital and Net
Income (Loss) of the Partnership. A separate Capital Account (or sub account)
shall be established for each Partner with respect to Fund Net Income (Loss),
Other Net Income (Loss) and the Performance Allocation, provided that each
Partner shall have a single Capital Account for U.S. federal income tax
purposes. In addition, the General Partner may also establish separate Capital
Accounts (or sub accounts) for each Partner with respect to any other categories
of Net Income (Loss) (if any) as it may determine in its sole discretion.

(b) As of the end of each accounting period or, in the case of a capital
contribution to the Partnership by one or more of the Partners or a distribution
by the Partnership to one or more of the Partners, at the time of such
contribution or distribution, (i) the appropriate Capital Accounts (or sub
accounts) of each Partner shall be credited with the following amounts: (A) the
amount of cash and the value of any property contributed by such Partner to the
capital of the Partnership during such accounting period and (B) the Net Income
allocated to such Partner in respect of such Capital Account (or sub account)
for such accounting period; and (ii) the appropriate Capital Accounts (or sub
accounts) of each Partner shall be debited with the following amounts: (x) the
amount of cash, the principal amount of any subordinated promissory note of the
Partnership referred to in Section 6.5 (as such amount is paid) and the value of
any property distributed to such Partner during such accounting period and
(y) the Net Loss allocated to such Partner in respect of such Capital Account
(or sub account) for such accounting period.

Section 5.3 Profit Sharing Percentages.

(a) On or about the beginning of each annual accounting period (or at such other
times as determined by the General Partner in its sole discretion), the General
Partner shall establish the profit sharing percentage (the “Profit Sharing
Percentage”) of each Partner in each category of Net Income (Loss) for such
annual accounting period pursuant to Section 5.1(a), taking into account such
factors as the General Partner deems appropriate, including those referred to in
Section 5.1. The General Partner may establish different Profit Sharing
Percentages for any Partner on a Fund-by-Fund basis with respect to each
different category of Net Income (Loss) for each such Fund (including, without
limitation, Fund Net Income (Loss), Other Net Income (Loss) and the Performance
Allocation) as it may determine in its sole discretion. The Profit Sharing
Percentages for any Partner with respect to each different category of Net
Income (Loss) for any individual Fund (including, without limitation, Fund Net
Income (Loss), Other Net Income (Loss) and the Performance Allocation) may be
the same or different as the General Partner may determine in its sole
discretion, subject to legal, tax regulatory and other considerations. The
Profit Sharing Percentage(s) of any Partner for any annual accounting period may
be adjusted in the case of the Withdrawal of a Partner pursuant to
Section 6.5(d) and in the case of the admission of any Partner to the
Partnership as an additional Partner pursuant to Section 6.1(b). Notwithstanding
the foregoing, the General Partner may also adjust the Profit Sharing
Percentage(s) of any Partner for any annual accounting period at the end of such
annual accounting period in its sole discretion. For the avoidance of doubt, the
General Partner shall take into account and exclude the Partnership’s capital
contributions and related interests in the Funds made prior to a Partner’s
admission to the Partnership in determining such Partner’s Capital Account
balance and Profit Sharing Percentage(s).

 

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(b) The General Partner may elect to allocate to the Partners less than 100% of
the Profit Sharing Percentages of any category of Net Income (Loss) for any
annual accounting period at the time specified in Section 5.3(a) for the annual
fixing of Profit Sharing Percentages (any remainder of such Profit Sharing
Percentages shall be the General Partner’s). In connection with the foregoing,
the General Partner shall take such other actions and make such adjustments
(including to the Partnership’s books and records) as the General Partner
determines are necessary or appropriate in its discretion.

Section 5.4 Allocations of Net Income (Loss). Except as otherwise provided in
this Agreement, Net Income (Loss) and, to the extent necessary, individual
categories thereof or components of income, gain, loss or deduction, of the
Partnership shall be allocated among the Partners in a manner that as closely as
possible gives economic effect to the provisions of this Article V and the other
relevant provisions of this Agreement, as determined in the reasonable
discretion of the General Partner.

Section 5.5 Liability of Partners Section 5.6 . Except as otherwise provided in
the Partnership Act, no Partner shall be personally obligated for any debt,
obligation or liability of the Partnership or of any other Partner solely by
reason of being a Partner. In addition, in no way does any of the foregoing
limit any Partner’s obligations to make capital contributions as provided
hereunder.

Section 5.6 Repurchase Rights, etc. The General Partner may from time to time
establish such repurchase rights and/or other requirements with respect to the
Partners’ Interests in the Partnership as the General Partner may determine. The
General Partner shall have authority to (a) withhold any distribution otherwise
payable to any Partner until any such repurchase rights have lapsed, or any such
requirements have been satisfied, (b) pay any distribution to any Partner that
is Contingent as of the distribution date and require the refund of any portion
of such distribution that is Contingent as of the Withdrawal Date of such
Partner, (c) amend any previously established repurchase or other requirements
from time to time and (d) make such exceptions thereto as it may determine on a
case-by-case basis.

Section 5.7 Distributions.

(a) The Partnership shall make distributions of available cash (subject to
reserves and other adjustments as provided herein) or other property to the
Partners at such times and in such amounts as are determined by the General
Partner in its sole discretion; it being understood that certain Partners may
receive cash while others may receive other property (e.g. Fund units) as
determined by the General Partner in its sole discretion. The General Partner
shall, if it deems it appropriate, determine the availability for distribution
of, and distribute, cash or other property separately for each category of Net
Income (Loss) established pursuant to Section 5.1(a). Subject to Section 5.1(e),
distributions of cash or other property with respect to Performance Allocation
shall be made among Partners in accordance with their respective Profit Sharing
Percentages with respect thereto. In accordance with the terms of each Fund
Agreement, with respect to each Partner, the General Partner shall elect to
receive the Performance Allocation from each Fund in cash or property (and to
redeem any property for other property in accordance with the terms of each Fund
Agreement), as determined by the General Partner in its sole discretion.

(b) Subject to the Partnership’s having sufficient available cash in the
reasonable judgment of the General Partner, the Partnership may make cash
distributions to each Partner with respect to each Fiscal Year of the
Partnership in an aggregate amount at least equal to the total U.S. federal, New
York State and New York City income and other taxes that would be payable by
such Partner with respect to all categories of GP-Related Net Income (Loss)
allocated to such Partner for such Fiscal Year, the amount of which shall be
calculated (i) on the assumption that each Partner is an individual subject to
the then prevailing maximum rate of U.S. federal, New York State and New York
City and other income

 

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taxes (including, without limitation, taxes under Section 1411 of the Code),
(ii) taking into account the limitations on the deductibility of expenses and
other items for U.S. federal income tax purposes and (iii) taking into account
any differential in applicable rates due to the type and character of GP-Related
Net Income (Loss) allocated to such Partner and (iv) taking into account any
other distribution made to such Partner under this Agreement during such Fiscal
Year. Notwithstanding the provisions of the foregoing sentence, the General
Partner may refrain from making any distribution if, in the reasonable judgment
of the General Partner, such distribution would be prohibited by § 17-607 of the
Partnership Act.

(c) The General Partner may provide that a Partner’s right to distributions and
investments of the Partnership may be subject to repurchase by the Partnership
during such period as the General Partner shall determine (a “Repurchase
Period”). Any Contingent distributions from investments subject to repurchase
rights will be withheld by the Partnership and will be distributed to the
recipient thereof (together with interest thereon at rates determined by the
General Partner from time to time) as the recipient’s rights to such
distributions become Non-Contingent (by virtue of the expiration of the
applicable Repurchase Period or otherwise). The General Partner may elect in an
individual case to have the Partnership distribute any Contingent distribution
to the applicable recipient thereof irrespective of whether the applicable
Repurchase Period has lapsed. If a Partner withdraws from the Partnership for
any reason other than his or her death, Total Disability or Incompetence, the
undistributed share of such Partner’s Interest that remains Contingent as of the
applicable Withdrawal Date shall be repurchased by the Partnership at a purchase
price determined at such time by the General Partner. Unless determined
otherwise by the General Partner, the repurchased portion thereof will be
allocated among the remaining Partners in proportion to their respective Profit
Sharing Percentages or if no other Partner has an applicable Profit Sharing
Percentage, to the General Partner; provided, that the General Partner may
allocate the Withdrawn Partner’s share of applicable unrealized investment
income attributable to the period after the Withdrawn Partner’s Withdrawal Date
on any basis it may determine, including to existing or new Partners who did not
previously have any applicable interests, except that, in any event, each
Limited Partner shall be allocated a share of such unrealized investment income
equal to its respective Profit Sharing Percentages with respect thereto.

Section 5.8 Business Expenses. The Partnership shall reimburse the Partners for
reasonable travel, entertainment and miscellaneous expenses incurred by them in
the conduct of the Partnership’s business in accordance with rules and
regulations established by the General Partner from time to time.

ARTICLE VI

ADDITIONAL PARTNERS; WITHDRAWAL OF PARTNERS;

SATISFACTION AND DISCHARGE OF

PARTNERSHIP INTERESTS; TERMINATION

Section 6.1 Additional Partners. (a) Effective on the first day of any year (or
on such other date as shall be determined by the General Partner in its sole
discretion), the General Partner shall have the right to admit one or more
additional or substitute persons into the Partnership as Limited Partners or
Special Partners. Each such person shall make the representations and
certifications with respect to itself set forth in Section 3.6 and Section 3.7.
The General Partner shall determine and negotiate with each additional Partner
(which term, for the avoidance of doubt, shall include, without limitation, any
substitute Partner) all terms of such additional Partner’s participation in the
Partnership, including (as applicable and without limitation) such additional
Partner’s initial capital contribution, and Profit Sharing Percentage(s). Each
additional Partner shall have such voting rights as may be determined by the
General Partner unless, upon the admission to the Partnership of any Special
Partner, the General

 

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Partner shall designate that such Special Partner shall not have such voting
rights (any such Special Partner being called a “Nonvoting Special Partner”).

(b) Except as may be otherwise determined by the General Partner, in the case of
the admission of any Partner to the Partnership as an additional Partner, the
Profit Sharing Percentages of the other Partners with respect to any category of
Net Income (Loss) for any Fund may be reduced on a pro rata basis (based on such
Partners’ respective Profit Sharing Percentages in effect immediately prior to
such admission) by an amount equal to the Profit Sharing Percentage allocated to
such new Partner with respect to each such category of Net Income (Loss) for
each such Fund.

(c) Each additional Partner may be required to contribute to the Partnership a
share of the Partnership’s total capital, at such times and in such amounts as
shall be determined by the General Partner or as may be mutually agreed
(including, where applicable, as set forth in such Limited Partner’s Admission
Letter) in accordance with Section 4.1.

(d) The admission of an additional Partner will be evidenced by (i) the
execution of a counterpart copy of, or counter-signature page with respect to,
this Agreement by such additional Partner or (ii) the execution of an amendment
to this Agreement by all the Partners (including the additional Partner), as
determined by the General Partner or (iii) the execution by such additional
Partner of any other writing evidencing the intent of such person to become a
substitute or additional Limited Partner or Special Partner and to be bound by
the terms of this Agreement and such writing being accepted by the General
Partner on behalf of the Partnership (which, for the avoidance of doubt, may be
in the form of an electronic acknowledgement (or click through) on a web-based
portal maintained by Blackstone).

Section 6.2 Withdrawal of Partners. (a) Any Partner (i) may be removed from the
Partnership at any time by the General Partner for any reason (including, but
not limited to, as indicated in any Admission Letter applicable to such Partner)
or no reason or (ii) shall be deemed to have withdrawn from the Partnership upon
such Partner’s death, Total Disability or Incompetence. Any Partner may Withdraw
voluntarily from the Partnership subject to the prior written consent of the
General Partner. The General Partner generally intends to permit voluntary
Withdrawals on the last day of the calendar month (or on such other date as
shall be determined by the General Partner in its sole discretion), on not less
than 15 days’ prior written notice by the Partner to the General Partner (or on
such shorter notice period as may be mutually agreed upon between such Partner
and the General Partner); provided, that a Partner may not voluntarily Withdraw
without the consent of the General Partner if such Withdrawal would (i) cause
the Partnership to be in default under any of its contractual obligations or
(ii) in the reasonable judgment of the General Partner, have a material adverse
effect on the Partnership or its business; provided further, that to the extent
a Withdrawal relates to a Capital Account relating to an investment of capital
in the Funds, such Withdrawal may only be made to the extent permitted by the
applicable Fund Agreements.

(b) Upon the Withdrawal of any Partner, including by the occurrence of any
Withdrawal event under the Partnership Act with respect to any Partner, such
Partner shall thereupon cease to be a Partner, except as expressly provided
herein and the Partnership Act.

(c) If the General Partner determines that it shall be in the best interests of
the Partnership for any Partner (including any Partner who has given notice of
voluntary Withdrawal pursuant to paragraph (a) above) to Withdraw from the
Partnership (whether or not Cause exists) with respect to such Partner’s
Interest, such Partner, upon written notice by the General Partner to such
Partner, shall be required to Withdraw with respect to such Partner’s Interest,
as determined by the General Partner, as of a date specified in such notice,
which date shall be on or after the date of such notice. If the General

 

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Partner requires any Partner to Withdraw for Cause with respect to such
Partner’s Interest, such notice shall state that it has been given for Cause and
shall describe the particulars thereof in reasonable detail.

(d) Upon the Total Disability of a Limited Partner, such Partner shall thereupon
cease to be a Limited Partner with respect to such Partner’s Interest; provided,
that the General Partner may elect to admit such Withdrawn Partner to the
Partnership as a Nonvoting Special Partner with respect to such Partner’s
Interest, with such Interest as the General Partner may determine. The
determination of whether any Partner has suffered a Total Disability shall be
made by the General Partner in its sole discretion after consultation with a
qualified medical doctor. In the absence of agreement between the General
Partner and such Partner, each party shall nominate a qualified medical doctor
and the two doctors shall select a third doctor, who shall make the
determination as to Total Disability.

(e) The withdrawal from the Partnership of any Partner shall not, in and of
itself, affect the obligations of the other Partners to continue the Partnership
during the remainder of its term. A Withdrawn General Partner shall remain
liable for all obligations of the Partnership incurred while it was a General
Partner and resulting from its acts or omissions as a General Partner to the
fullest extent provided by law.

Section 6.3 Partnership Interests Not Transferable. (a) No Partner may sell,
assign, pledge or otherwise transfer or encumber all or any portion of such
Partner’s Interest other than as permitted by written agreement between such
Partner and the Partnership; provided, that this Section 6.3 shall not impair
transfers by operation of law, transfers by will or by other testamentary
instrument occurring by virtue of the death or dissolution of a Partner, or
transfers required by trust agreements; provided further, that a Limited Partner
may transfer, for estate planning purposes, up to 25% of his or her Profit
Sharing Percentage to any estate planning trust, limited partnership, or limited
liability company with respect to which a Limited Partner controls investments
related to any interest in the Partnership held therein (an “Estate Planning
Vehicle”). Each Estate Planning Vehicle will be a Nonvoting Special Partner.
Such Limited Partner and the Nonvoting Special Partner shall be jointly and
severally liable for all obligations of both such Limited Partner and such
Nonvoting Special Partner with respect to the Partnership, as the case may be.
The General Partner may at its sole option exercisable at any time require any
Estate Planning Vehicle to withdraw from the Partnership on the terms of this
Article VI. Except as provided in the second proviso to the first sentence of
this Section 6.3, no assignee, legatee, distributee, heir or transferee (by
conveyance, operation of law or otherwise) of the whole or any portion of any
Partner’s Interest shall have any right to be a Partner without the prior
written consent of the General Partner (which consent may be withheld without
giving reason therefor). Notwithstanding the granting of a security interest in
the entire Interest of any Partner, such Partner shall continue to be a Partner
of the Partnership.

(b) Notwithstanding any provision hereof to the contrary, no sale or transfer of
any interest in the Partnership may be made except in compliance with all
federal, state and other applicable laws, including federal and state securities
laws.

Section 6.4 Consequences upon Withdrawal of a Partner.

(a) The Withdrawal of a Partner shall not dissolve the Partnership if at the
time of such Withdrawal there are one or more remaining Partners (including the
General Partner) and any one or more of such remaining Partners continue the
business of the Partnership (any and all such remaining Partners being hereby
authorized to continue the business of the Partnership without dissolution and
hereby agreeing to do so).

 

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(b) The Partnership shall not be dissolved, in and of itself, by the Withdrawal
of any Partner, but shall continue with the surviving or remaining Partners as
partners thereof in accordance with and subject to the terms and provisions of
this Agreement.

Section 6.5 Satisfaction and Discharge of a Withdrawn Partner’s Interest.
(a) The terms of this Section 6.5 shall apply to the Interest of a Withdrawn
Partner. The term “Settlement Date” shall mean the date as of which a Withdrawn
Partner’s Interest in the Partnership is settled as determined under paragraph
(b) below.

(b) Except where a later date for the settlement of a Withdrawn Partner’s
Interest in the Partnership may be agreed to by the General Partner and a
Withdrawn Partner, a Withdrawn Partner’s Settlement Date shall be his or her
Withdrawal Date; provided, that if a Withdrawn Partner’s Withdrawal Date or
Settlement Date is not the last day of a month, then the General Partner may
elect in its discretion for the Withdrawal Date or the Settlement Date to be the
last day of the month following the Withdrawal Date or Settlement Date as the
case may be. During the interval, if any, between a Withdrawn Partner’s
Withdrawal Date and Settlement Date, such Withdrawn Partner shall (subject to
such Partner’s Admission Letter, as applicable) have the same rights and
obligations with respect to capital contributions, interest on capital,
allocations of Net Income (Loss) and distributions as would have applied had
such Withdrawn Partner remained a Partner of the Partnership during such period.

(c) In the event of the Withdrawal of a Partner, the General Partner shall
promptly after such Withdrawn Partner’s Settlement Date (i) determine and
allocate to the Withdrawn Partner’s Capital Account such Withdrawn Partner’s
allocable share of the Net Income (Loss) of the Partnership for the period
ending on such Settlement Date in accordance with Article V and (ii) credit the
Withdrawn Partner’s Capital Account with interest in accordance with
Section 5.2. In making the foregoing calculations, the General Partner shall be
entitled to establish such reserves (including reserves, taxes, bad debts,
unrealized losses, actual or threatened litigation or any other expenses,
contingencies or obligations) as it deems appropriate. Except as provided in
this Section 6.5(c) and unless otherwise determined by the General Partner in a
particular case, a Withdrawn Partner shall not be entitled to receive any
amounts in respect of the annual accounting period during which such Partner
Withdraws from the Partnership (whether or not previously awarded or allocated)
or any amounts in respect of prior annual accounting periods that have not been
paid or allocated (whether or not previously awarded) as of such Withdrawn
Partner’s Withdrawal Date.

(d) From and after the Settlement Date of a Withdrawn Partner, such Partner’s
Profit Sharing Percentages in respect of each category of Net Income (Loss) of
the Partnership shall be reduced to zero (or in the case of a partial
Withdrawal, shall be reduced proportionately based on the percentage of the
Interest withdrawn by the relevant Partner), and (i) the Profit Sharing
Percentages of all of the remaining Partners shall be adjusted pro rata to their
respective Profit Sharing Percentages in such category of Net Income (Loss) of
the Partnership at such time or (ii) the Profit Sharing Percentages of the
General Partner shall be adjusted to include the Profit Sharing Percentages of
the Withdrawn Partner, or any combination of the foregoing, in each case, as
determined by the General Partner in its sole discretion.

(e) Upon the Withdrawal from the Partnership of a Partner such Withdrawn Partner
thereafter shall not, except as expressly provided in this Section 6.5, have any
rights of a Partner (including voting rights), and, except as expressly provided
in this Section 6.5, such Withdrawn Partner shall not have any interest in any
category of the Partnership’s Net Income (Loss) (including, without limitation,
Fund Net Income (Loss), Other Net Income (Loss) or the Performance Allocation)
or in distributions, investments or other assets related to such Partner’s
Interest. If a Partner Withdraws from the Partnership for any reason other than
for Cause, then the Withdrawn Partner shall be entitled to

 

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receive, at the time or times specified in Section 6.5(g) below, in satisfaction
and discharge in full of the Withdrawn Partner’s Interest in the Partnership,
payment equal to the aggregate positive balance, if any, as of the Settlement
Date of the Withdrawn Partner’s Capital Account (or portion thereof, as
applicable), subject to all the terms and conditions of paragraphs (a)-(o) of
this Section 6.5. If the amount determined pursuant to the language above is an
aggregate negative balance, the Withdrawn Partner shall pay the amount thereof
to the Partnership upon demand by the General Partner on or after the date of
the statement referred to in Section 6.5(g) below; provided, that if the
Withdrawn Partner was solely a Special Partner on his or her Withdrawal Date,
such payment shall be required only to the extent of any amounts payable to such
Withdrawn Partner pursuant to this Section 6.5. Any aggregate negative balance
in the Capital Accounts of a Withdrawn Partner who was solely a Special Partner,
upon the settlement of such Withdrawn Partner’s Interest in the Partnership
pursuant to this Section 6.5, shall be allocated among the other Partners’
Capital Accounts in accordance with their respective Profit Sharing Percentages
in the categories of Net Income (Loss) giving rise to such negative balance as
determined by the General Partner as of such Withdrawn Partner’s Settlement
Date. In the settlement of any Withdrawn Partner’s Interest in the Partnership,
no value shall be ascribed to goodwill, the Partnership name or in anticipation
of any value the Partnership or any successor thereto might have in the event
the Partnership or any interest therein were to be sold in whole or in part.

(ii) Notwithstanding clause (i) of this Section 6.5(e), in the case of a Partner
whose Withdrawal with respect to such Partner’s Interest resulted from such
Partner’s death or Incompetence, such Partner’s estate or legal representative,
as the case may be, may elect, at the time described below, to receive a
Nonvoting Special Partner Interest and retain such Partner’s Profit Sharing
Percentage in all (but not less than all) illiquid investments of the
Partnership in lieu of a cash payment (or promissory note) in settlement of that
portion of the Withdrawn Partner’s Interest. The election referred to above
shall be made within 60 days after the Withdrawn Partner’s Settlement Date,
based on a statement of the settlement of such Withdrawn Partner’s Interest in
the Partnership pursuant to this Section 6.5.

(f) The General Partner may elect, in lieu of payment in cash of any amount
payable to a Withdrawn Partner pursuant to paragraph (e) above, to have the
Partnership issue the Withdrawn Partner a subordinated promissory note and/or to
distribute in-kind to the Withdrawn Partner such Withdrawn Partner’s pro rata
share (as determined by the General Partner) of any securities or other
investments of the Partnership in relation to such Partner’s Interest. If any
such distributions in-kind are made to a Withdrawn Partner in respect of its
Interest under this paragraph (g), the amount described in paragraph (e) shall
be reduced by the value of such distribution as valued on the latest balance
sheet of the Partnership in accordance with generally accepted accounting
principles or, if not appearing on such balance sheet, as reasonably determined
by the General Partner.

(g) Within 120 days after the Settlement Date, the General Partner shall submit
to the Withdrawn Partner a statement of the settlement of such Withdrawn
Partner’s Interest in the Partnership pursuant to this Section 6.5 together with
any cash payment, subordinated promissory note and in kind distributions to be
made to such Partner as shall be determined by the General Partner. The General
Partner shall submit to the Withdrawn Partner supplemental statements with
respect to additional amounts payable to or by the Withdrawn Partner in respect
of the settlement of his or her Interest in the Partnership promptly after such
amounts are determined by the General Partner. To the fullest extent permitted
by law, such statements and the valuations on which they are based shall be
accepted by the Withdrawn Partner without examination of the accounting books
and records of the Partnership or other inquiry. Any amounts payable by the
Partnership to a Withdrawn Partner pursuant to this Section 6.5 shall be
subordinate in right of payment and subject to the prior payment or provision
for payment in full of claims of all present or future creditors of the
Partnership or any successor thereto arising out of matters occurring prior to
the applicable date of payment or distribution; provided that such Withdrawn

 

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Partner shall otherwise rank pari passu in right of payment (x) with all persons
who become Withdrawn Partners and whose Withdrawal Date is within one year
before the Withdrawal Date of the Withdrawn Partner in question and (y) with all
persons who become Withdrawn Partners and whose Withdrawal Date is within one
year after the Withdrawal Date of the Withdrawn Partner in question.

(h) If the aggregate reserves established by the General Partner as of the
Settlement Date in making the foregoing calculations should prove, in the
determination of the General Partner, to be excessive or inadequate, the General
Partner may elect, but shall not be obligated, to pay the Withdrawn Partner or
his or her estate such excess, or to charge the Withdrawn Partner or his or her
estate such deficiency, as the case may be.

(i) Any amounts owed by the Withdrawn Partner to the Partnership or any of its
Affiliates at any time on or after the Settlement Date (e.g., outstanding
Partnership loans or advances to such Withdrawn Partner) shall be offset against
any amounts payable or distributable by the Partnership to the Withdrawn Partner
at any time on or after the Settlement Date or shall be paid by the Withdrawn
Partner to the Partnership, in each case as determined by the General Partner.
All cash amounts payable by a Withdrawn Partner to the Partnership under this
Section 6.5 shall bear interest from the due date to the date of payment at a
floating rate equal to the lesser of (x) the Prime Rate or (y) the maximum rate
of interest permitted by applicable law. The “due date” of amounts payable by a
Withdrawn Partner pursuant to Section 6.5(h) above shall be 120 days after a
Withdrawn Partner’s Settlement Date. The “due date” of any amounts payable by a
Withdrawn Partner shall be 60 days after the date such amounts are determined to
be payable.

(j) At the time of the settlement of any Withdrawn Partner’s Interest in the
Partnership pursuant to this Section 6.5, the General Partner may, to the
fullest extent permitted by applicable law, impose any restrictions it deems
appropriate on the assignment, pledge, encumbrance or other transfer by such
Withdrawn Partner of any Interest retained by such Withdrawn Partner, any
securities or other investments distributed in-kind to such Withdrawn Partner or
such Withdrawn Partner’s right to any payment from the Partnership.

(k) If a Partner is required to Withdraw from the Partnership with respect to
such Partner’s Interest for Cause, then his or her Partner Interest shall be
settled in accordance with paragraphs (a)-(o) of this Section 6.5; provided,
however, that the General Partner may elect (but shall not be required) to
determine that any amounts payable by the Partnership to the Withdrawn Partner
pursuant to this Section 6.5 shall be subordinate in right of payment and
subject to the prior payments in full of claims of all present or future
creditors of the Partnership or any successor thereto arising out of matters
occurring prior to or on or after the applicable date of payment or
distribution.

(l) The payments to a Withdrawn Partner pursuant to this Section 6.5 may be
conditioned on the compliance by such Withdrawn Partner with any lawful and
reasonable (under the circumstances) restrictions against engaging or investing
in a business competitive with that of the Partnership or any of its
subsidiaries and Affiliates for a period not exceeding two years determined by
the General Partner. Upon written notice to the General Partner, any Withdrawn
Partner who is subject to noncompetition restrictions established by the General
Partner pursuant to this paragraph (l) may elect to forfeit the principal amount
payable in the final installment of his or her subordinated promissory note,
together with interest to be accrued on such installment after the date of
forfeiture, in lieu of being bound by such restrictions.

(m) In addition to the foregoing, the General Partner shall have the right to
pay a Withdrawn Partner a discretionary additional payment in an amount and
based upon such circumstances and conditions as it determines to be relevant.

 

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(n) The provisions of this Section 6.5 shall apply to any Partner relating to a
Partner and to any transferee of any interest of such Partner pursuant to
Section 6.3 if such Partner Withdraws from the Partnership.

(o) The Partnership will assist a Withdrawn Partner or its estate or guardian,
as the case may be, in the settlement of the Withdrawn Partner’s Interest in the
Partnership. Third party costs incurred by the Partnership in providing this
assistance will be borne by the Withdrawn Partner or its estate.

(p) The Partnership may reasonably determine in good faith to retain outside
professionals to provide the assistance to Withdrawn Partners or their estates
or guardians, as referred to above. In such instances, the Partnership will
obtain the prior approval of a Withdrawn Partner or his or her estate or
guardian, as the case may be, prior to engaging such professionals. If the
Withdrawn Partner (or his or her estate or guardian) declines to incur such
costs, the Partnership will provide such reasonable assistance as and when it
can so as not to interfere with the Partnership’s day-to-day operating,
financial, tax and other related responsibilities to the Partnership and the
Partners.

(q) Each Partner hereby irrevocably appoints the General Partner as such
Partner’s true and lawful agent, representative and attorney-in-fact, each
acting alone, in such Partner’s name, place and stead, to make, execute, sign
and file, on behalf of such Partner, any and all agreements, instruments,
consents, ratifications, documents and certificates which the General Partner
deems necessary or advisable in connection with any transaction or matter
contemplated by or provided for in this Section 6.5, including, without
limitation, the performance of any obligation of such Partner or the Partnership
or the exercise of any right of such Partner or the Partnership. Such power of
attorney is coupled with an interest and shall survive and continue in full
force and effect notwithstanding the Withdrawal from the Partnership of any
Partner for any reason and shall not be affected by the death, disability or
incapacity of such Partner.

Section 6.6 Dissolution of the Partnership. The General Partner may dissolve the
Partnership at any time on not less than 60 days’ notice of the dissolution date
given to the other Partners. Upon the dissolution of the Partnership, and
following the payment of creditors of the Partnership and the making of
provisions for the payment of any contingent, conditional or unmatured claims
known to the Partnership as required under the Partnership Act, the Partners’
respective interests in the Partnership shall be valued and settled in
accordance with the procedures set forth in Sections 5.7 and 6.5 which provide
for allocations to the Capital Accounts of the Partners and distributions in
accordance with the Capital Account balances of the Partners. The General
Partner shall be the liquidator. In the event that the General Partner is unable
to serve as liquidator, a liquidating trustee shall be chosen by affirmative
vote of a Majority in Interest of the Partners voting at a meeting of Partners
(excluding Nonvoting Special Partners).

Section 6.7 Certain Tax Matters. (a) All items of income, gain, loss, deduction
and credit of the Partnership shall be allocated among the Partners for federal,
state and local income tax purposes in the same manner as such items of income,
gain, loss, deduction and credit shall be allocated among the Partners pursuant
to this Agreement, except as may otherwise be provided herein or by the Code or
other applicable law. To the extent Regulations promulgated pursuant to
Subchapter K of the Code (including under Sections 704(b) and (c) of the Code)
or other applicable law require allocations for tax purposes that differ from
the foregoing allocations, the General Partner may determine the manner in which
such tax allocations shall be made so as to comply more fully with such
Regulations or other applicable law and, at the same time, preserve the economic
relationships among the Partners as set forth in this Agreement. In the case of
a sale or other taxable exchange of an asset of the Partnership by the
Partnership on behalf of a Limited Partner or Special Partner in accordance with
this Agreement

 

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(including a taxable exchange of such asset for consideration other than cash),
taxable gain and taxable loss on the disposition of such asset shall be
specially allocated among the Partners such that, to the maximum extent
possible, such Partners who receive cash or other proceeds from such disposition
(including a distribution in-kind of the asset received in a taxable exchange)
shall be allocated taxable gain and loss resulting from such sale or exchange.
In the event there is a net decrease in partnership minimum gain or partner
nonrecourse debt minimum gain (determined in accordance with the principles of
Regulation Sections 1.704-2(d) and 1.704-2(i)) during any taxable year of the
Partnership, each Partner shall be specially allocated items of Partnership
income and gain for such year (and, if necessary, subsequent years) in an amount
equal to its respective share of such net decrease during such year, determined
pursuant to Regulations Sections 1.704-2(g) and 1.704-2(i) (5). The items to be
so allocated shall be determined in accordance with Regulations
Section 1.704-2(f). In addition, this Agreement shall be considered to contain a
“qualified income offset” as provided in Regulations
Section 1.704-1(b)(2)(ii)(d).

(b) Notwithstanding Section 6.7(a), if the Partnership realizes capital gains
(including short-term capital gains) for federal income tax purposes (“gains”)
for any fiscal year during or as of the end of which one or more Positive Basis
Partners (as hereinafter defined) Withdraw from the Partnership pursuant to this
Article VI, the General Partner may elect to allocate such gains as follows:
(i) to allocate such gains among such Positive Basis Partners, pro rata in
proportion to the respective Positive Basis (as hereinafter defined) of each
such Positive Basis Partner, until either the full amount of such gains shall
have been so allocated or the Positive Basis of each such Positive Basis Partner
shall have been eliminated and (ii) to allocate any gains not so allocated to
Positive Basis Partners to the other Partners in such manner as shall equitably
reflect the amounts allocated to such Partners’ Capital Accounts pursuant to
this Agreement.

As used herein, (i) the term “Positive Basis” shall mean, with respect to any
Partner and as of any time of calculation, the amount by which its aggregate
Capital Account balance (determined in accordance with Section 5.2) as of such
time exceeds its “adjusted tax basis,” for Federal income tax purposes, in its
interest in the Partnership as of such time (determined without regard to any
adjustments made to such “adjusted tax basis” by reason of any transfer or
assignment of such interest, including by reason of death, and without regard to
such Partner’s share of the liabilities of the Partnership under Section 752 of
the Code), and (ii) the term “Positive Basis Partner” shall mean any Partner who
Withdraws from the Partnership and who has Positive Basis as of the effective
date of its Withdrawal, but such Partner shall cease to be a Positive Basis
Partner at such time as it shall have received allocations pursuant to clause
(i) of the first paragraph of this Section 6.7(b) equal to its Positive Basis as
of the effective date of its Withdrawal.

(c) The General Partner shall cause to be prepared all federal, state and local
tax returns of the Partnership for each year for which such returns are required
to be filed and, after approval of such returns by the General Partner, shall
cause such returns to be timely filed. The General Partner shall determine the
appropriate treatment of each item of income, gain, loss, deduction and credit
of the Partnership and the accounting methods and conventions under the tax laws
of the United States, the several states and other relevant jurisdictions as to
the treatment of any such item or any other method or procedure related to the
preparation of such tax returns. The General Partner may cause the Partnership
to make or refrain from making any and all elections permitted by such tax laws.
Each Partner agrees that he or she shall not, unless he or she provides prior
notice of such action to the Partnership, (i) treat, on his or her individual
income tax returns, any item of income, gain, loss, deduction or credit relating
to his or her interest in the Partnership in a manner inconsistent with the
treatment of such item by the Partnership as reflected on the Form K-l or other
information statement furnished by the Partnership to such Partner for use in
preparing his or her income tax returns or (ii) file any claim for refund
relating to any such item based on, or which would result in, such inconsistent
treatment. In respect of an income tax audit of any

 

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tax return of the Partnership, the filing of any amended return or claim for
refund in connection with any item of income, gain, loss, deduction or credit
reflected on any tax return of the Partnership, or any administrative or
judicial proceedings arising out of or in connection with any such audit,
amended return, claim for refund or denial of such claim, (A) the Partnership
Representative (as defined below) shall be authorized to act for, and his or her
decision shall be final and binding upon, the Partnership and all Partners
except to the extent a Partner shall properly elect to be excluded from such
proceeding pursuant to the Code, (B) all expenses incurred by the Partnership
Representative in connection therewith (including, without limitation,
attorneys’, accountants’ and other experts’ fees and disbursements) shall be
expenses of the Partnership and (C) no Partner shall have the right to
(1) participate in the audit of any Partnership tax return, (2) file any amended
return or claim for refund in connection with any item of income, gain, loss,
deduction or credit reflected on any tax return of the Partnership (unless he or
she provides prior notice of such action to the Partnership as provided above),
(3) participate in any administrative or judicial proceedings conducted by the
Partnership or the Partnership Representative arising out of or in connection
with any such audit, amended return, claim for refund or denial of such claim or
(4) appeal, challenge or otherwise protest any adverse findings in any such
audit conducted by the Partnership or the Partnership Representative or with
respect to any such amended return or claim for refund filed by the Partnership
or the Partnership Representative or in any such administrative or judicial
proceedings conducted by the Partnership or the Partnership Representative. The
Partnership and each Partner shall designate any person selected by the General
Partner as the “partnership representative” within the meaning of
Section 6223(a) of the Code (the “Partnership Representative”). To the fullest
extent permitted by applicable law, each Partner agrees to indemnify and hold
harmless the Partnership and all other Partners from and against any and all
liabilities, obligations, damages, deficiencies and expenses resulting from any
breach or violation by such Partner of the provisions of this Section 6.7 and
from all actions, suits, proceedings, demands, assessments, judgments, costs and
expenses, including reasonable attorneys’ fees and disbursements, incident to
any such breach or violation. Each person (for purposes of this Section 6.7(c),
called a “Pass-Thru Partner”) that holds or controls an interest as a Partner on
behalf of, or for the benefit of, another person or persons, or which Pass-Thru
Partner is beneficially owned (directly or indirectly) by another person or
persons, shall, within 30 days following receipt from the Partnership
Representative of any notice, demand, request for information or similar
document, convey such notice or other document in writing to all holders of
beneficial interests in the Partnership holding such interests through such
Pass-Thru Partner.

(d) Each individual Partner shall provide to the Partnership copies of each
federal, state and local income tax return of such Partner (including any
amendment thereof) within 30 days after filing such return.

(e) To the extent the General Partner reasonably determines that the Partnership
(or any entity in which the Partnership holds an interest) is or may be required
by law to withhold or to make tax payments, including interest and penalties on
such amounts, on behalf of or with respect to any Partner, including pursuant to
Section 6225 of the Code (“Tax Advances”), the General Partner may withhold or
escrow such amounts or make such tax payments as so required. All Tax Advances
made on behalf of a Partner shall, at the option of the General Partner, (i) be
promptly paid to the Partnership by the Partner on whose behalf such Tax
Advances were made or (ii) be repaid by reducing the amount of the current or
next succeeding distribution or distributions which would otherwise have been
made to such Partner or, if such distributions are not sufficient for that
purpose, by so reducing the proceeds upon dissolution of the Partnership
otherwise payable to such Partnership. Whenever the General Partner selects
option (ii) pursuant to the preceding sentence for repayment of a Tax Advance by
a Partner, for all other purposes of this Agreement such Partner shall be
treated as having received all distributions (whether before or upon dissolution
of the Partnership) unreduced by the amount of such Tax Advance. To the fullest
extent permitted by law, each Partner hereby agrees to indemnify and hold
harmless all other Partners from and against any liability (including, without
limitation, any liability for taxes,

 

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penalties, additions to tax or interest) with respect to income attributable to
or distributions or other payments to such Partner. The obligations of a Partner
set forth in this Section 6.7(d) shall survive the withdrawal of any Partner
from the Partnership or any transfer of a Partner’s interest.

Section 6.8 Special Basis Adjustments. In connection with a distribution of
Partnership property to a Partner or any assignment or transfer of a Partnership
interest permitted by the terms of this Agreement, the General Partner may cause
the Partnership, on behalf of the Partners and at the time and in the manner
provided in Code Section 754 and Regulation Section 1.754-1(b), to make an
election to adjust the basis of the Partnership’s property in the manner
provided in Sections 734(b) and 743(b) of the Code.

ARTICLE VII

MISCELLANEOUS

Section 7.1 Submission to Jurisdiction; Waiver of Jury Trial.

(a) Any and all disputes which cannot be settled amicably, including any
ancillary claims of any party, arising out of, relating to or in connection with
the validity, negotiation, execution, interpretation, performance or
non-performance of this Agreement (including the validity, scope and
enforceability of this arbitration provision as well as any and all disputes
arising out of, relating to or in connection with the termination, winding up or
dissolution of the Partnership), whether arising during the existence of the
Partnership or at or after its termination or during or after the winding up or
dissolution of the Partnership shall be finally settled by arbitration conducted
by a single arbitrator in New York, New York U.S.A. in accordance with the
then-existing Rules of Arbitration of the International Chamber of Commerce. If
the parties to the dispute fail to agree on the selection of an arbitrator
within 30 days of the receipt of the request for arbitration, the International
Chamber of Commerce shall make the appointment. The arbitrator shall be a lawyer
and shall conduct the proceedings in the English language. Performance under
this Agreement shall continue if reasonably possible during any arbitration
proceedings.

(b) Notwithstanding the provisions of paragraph (a), the General Partner may
bring, or may cause the Partnership to bring, on behalf of the General Partner
or the Partnership or on behalf of one or more Partners, an action or special
proceeding in any court of competent jurisdiction for the purpose of compelling
a party to arbitrate, seeking temporary or preliminary relief in aid of an
arbitration hereunder, and/or enforcing an arbitration award and, for the
purposes of this paragraph (b), each Partner (i) expressly consents to the
application of paragraph (c) of this Section 7.1 to any such action or
proceeding, (ii) agrees that proof shall not be required that monetary damages
for breach of the provisions of this Agreement would be difficult to calculate
and that remedies at law would be inadequate, and (iii) irrevocably appoints the
General Partner as such Partner’s agent for service of process in connection
with any such action or proceeding and agrees that service of process upon any
such agent, who shall promptly advise such Partner of any such service of
process, shall be deemed in every respect effective service of process upon the
Partner in any such action or proceeding.

(C) (i) EACH PARTNER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF COURTS
LOCATED IN NEW YORK, NEW YORK FOR THE PURPOSE OF ANY JUDICIAL PROCEEDING BROUGHT
IN ACCORDANCE WITH THE PROVISIONS OF PARAGRAPH (C) OF THIS SECTION 7.1, OR ANY
JUDICIAL PROCEEDING ANCILLARY TO AN ARBITRATION OR CONTEMPLATED ARBITRATION
ARISING OUT OF OR RELATING TO OR CONCERNING THIS AGREEMENT. Such ancillary
judicial proceedings include any suit, action or proceeding to compel
arbitration, to obtain temporary or preliminary judicial relief in aid of
arbitration, or

 

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to confirm an arbitration award. The parties acknowledge that the forum(s)
designated by this paragraph (c) have a reasonable relation to this Agreement,
and to the parties’ relationship with one another.

(ii) The parties hereby waive, to the fullest extent permitted by applicable
law, any objection which they now or hereafter may have to personal jurisdiction
or to the laying of venue of any such ancillary suit, action or proceeding
brought in any court referred to in paragraph (c)(i) of this Section 7.1 and
such parties agree not to plead or claim the same.

(d) Notwithstanding any provision of this Agreement to the contrary, this
Section 7.1 shall be construed to the maximum extent possible to comply with the
laws of the State of Delaware, including the Delaware Uniform Arbitration Act
(10 Del. C. § 5701 et seq.) (the “Delaware Arbitration Act”). If, nevertheless,
it shall be determined by a court of competent jurisdiction that any provision
or wording of this Section 7.1, including any rules of the International Chamber
of Commerce, shall be invalid or unenforceable under the Delaware Arbitration
Act, or other applicable law, such invalidity shall not invalidate all of this
Section 7.1. In that case, this Section 7.1 shall be construed so as to limit
any term or provision so as to make it valid or enforceable within the
requirements of the Delaware Arbitration Act or other applicable law, and, in
the event such term or provision cannot be so limited, this Section 7.1 shall be
construed to omit such invalid or unenforceable provision.

Section 7.2 Ownership and Use of the Blackstone Name. The Partnership
acknowledges that Blackstone TM L.L.C. (“TM”), a Delaware limited liability
company with a principal place of business at 345 Park Avenue, New York, New
York 10154, (or its successors or assigns) is the sole and exclusive owner of
the mark and name BLACKSTONE and that the ownership of, and the right to use,
sell or otherwise dispose of, the firm name or any abbreviation or modification
thereof which consists of or includes BLACKSTONE, shall belong exclusively to
TM, which company (or its predecessors, successors or assigns) has licensed the
Partnership to use BLACKSTONE in its name. The Partnership acknowledges that TM
owns the service mark BLACKSTONE for various services and that the Partnership
is using the BLACKSTONE mark and name on a non-exclusive, non-sublicensable and
non-assignable basis in connection with its business and authorized activities
with the Permission of TM. All services rendered by the Partnership under the
BLACKSTONE mark and name will be rendered in a manner and with quality levels
that are consistent with the high reputation heretofore developed for the
BLACKSTONE mark by TM and its Affiliates and licensees. The Partnership
understands that TM may terminate its right to use BLACKSTONE at any time in
TM’s sole discretion by giving the Partnership written notice of termination.
Promptly following any such termination, the Partnership will take all steps
necessary to change its partnership name to one which does not include
BLACKSTONE or any confusingly similar term and cease all use of BLACKSTONE or
any term confusingly similar thereto as a service mark or otherwise.

Section 7.3 Written Consent. Any action required or permitted to be taken by a
vote of Partners at a meeting may be taken without a meeting if a Majority in
Interest of the Partners consent thereto in writing.

Section 7.4 Admission Letters; Schedules. The General Partner may, or may cause
the Partnership to, enter or has previously entered into separate letter
agreements or other agreements or undertakings, which may be in the form of
electronic “acknowledgements” and similar arrangements and related materials
posted or maintained on one or more web-based portals established by Blackstone
(collectively, “Admission Letters”) with certain Partners with respect to
capital contributions, Profit Sharing Percentages, benefits or any other matter.
Notwithstanding anything in this Agreement to the contrary, each Partner’s
interest in the Partnership shall be subject to repurchase rights and other
terms as indicated in such Partner’s Admission Letter (or other writing between
the General Partner and such Partner). The General Partner may from time to time
execute and deliver to the Partners schedules which

 

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set forth the then current Capital Account balances and Profit Sharing
Percentages of the Partners and any other matters deemed appropriate by the
General Partner. Such schedules shall be for information purposes only and shall
not be deemed to be part of this Agreement for any purpose whatsoever.

Section 7.5 Governing Law; Separability of Provisions. This Agreement shall be
governed by and construed in accordance with the laws of the State of Delaware
without regard to principles of conflict of laws. In particular, the Partnership
has been formed pursuant to the Partnership Act, and the rights and liabilities
of the Partners shall be as provided therein, except as herein otherwise
expressly provided. If any provision of this Agreement shall be held to be
invalid, such provision shall be given its meaning to the maximum extent
permitted by law and the remainder of this Agreement shall not be affected
thereby.

Section 7.6 Successors and Assigns. This Agreement shall be binding upon and
shall, subject to the penultimate sentence of Section 6.3, inure to the benefit
of the parties hereto, their respective heirs and personal representatives, and
any successor to a trustee of a trust which is or becomes a party hereto;
provided that no person claiming by, through or under a Partner (whether such
Partner’s heir, personal representative or otherwise), as distinct from such
Partner itself, shall have any rights as, or in respect to, a Partner (including
the right to approve or vote on any matter or to notice thereof) except the
right to receive only those distributions expressly payable to such person
pursuant to Article VI. Any Partner or Withdrawn Partner shall remain liable for
the obligations under this Agreement of any transferee of all or any portion of
such Partner’s or Withdrawn Partner’s interest in the Partnership, unless waived
by the General Partner. Nothing in this Agreement is intended, nor shall
anything herein be construed, to confer any rights, legal or equitable, in any
person other than the Partners and their respective legal representatives,
heirs, successors and permitted assigns.

Section 7.7 Partner’s Will. Each Limited Partner and Withdrawn Partner shall
include in his or her will a provision that addresses certain matters in respect
of his or her obligation relating to the Partnership that is satisfactory to the
General Partner, and each such Limited Partner and Withdrawn Partner shall
confirm annually to the Partnership, in writing, that such provision remains in
his or her current will. Where applicable, any estate planning trust of such
Partner or Withdrawn Partner to which a portion of such Limited Partner’s or
Withdrawn Partners’ Interest is transferred shall include a provision
substantially similar to such provision and the trustee of such trust shall
confirm annually to the Partnership, in writing, that such provision or its
substantial equivalent remains in such trust. In the event any Limited Partner
or Withdrawn Partner fails to comply with the provisions of this Section 7.7
after the Partnership has notified such Limited Partner or Withdrawn Partner of
his or her failure to so comply and such failure to so comply is not cured
within 30 days of such notice, the Partnership may withhold any and all
distributions to such Limited Partner or Withdrawn Partner until the time at
which such party complies with the requirements of this Section 7.7.

Section 7.8 Confidentiality; Restrictive Covenants. (a) By executing this
Agreement, each Partner expressly agrees, at all times during the term of the
Partnership and thereafter and whether or not at the time a Partner of the
Partnership, to maintain the confidentiality of, and not to disclose to any
person other than the Partnership, another Partner or a person designated by the
Partnership, any information relating to the business, financial structure,
financial position or financial results, clients or affairs of the Partnership
or the Funds that shall not be generally known to the public or the securities
industry, except as otherwise required by law or by any regulatory or
self-regulatory organization having jurisdiction; provided, that any corporate
Partner may disclose any such information it is required by law, rule,
regulation or custom to disclose. In addition, each Partner shall be subject to
the restrictive covenants and other obligations set forth in such Partner’s
Admission Letter. Notwithstanding anything in this Agreement to the contrary, to
comply with Treasury Regulations Section 1.6011-4(b)(3)(i), each Partner (and
any employee, representative or other agent of such Partner) may disclose to any
and all

 

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persons, without limitation of any kind, the U.S. federal income tax treatment
and tax structure of the Partnership, it being understood and agreed, for this
purpose, (1) the name of, or any other identifying information regarding (a) the
Partners or any existing or future investor (or any Affiliate thereof) in any of
the Partners, or (b) any investment or transaction entered into by the Partners;
(2) any performance information relating to any of the Partners or their
investments; and (3) any performance or other information relating to previous
funds or investments sponsored by any of the Partners, does not constitute such
tax treatment or tax structure information.

(b) Nothing in this Agreement shall prohibit or impede any Partner from
communicating, cooperating or filing a complaint on possible violations of U.S.
federal, state or local law or regulation to or with any governmental agency or
regulatory authority (collectively, a “Governmental Entity”), including, but not
limited to, the SEC, FINRA, EEOC or NLRB, or from making other disclosures to
any Governmental Entity that are protected under the whistleblower provisions of
U.S. federal, state or local law or regulation, provided that in each case such
communications and disclosures are consistent with applicable law. Each Partner
understands and acknowledges that (a) an individual shall not be held criminally
or civilly liable under any U.S. federal or state trade secret law for the
disclosure of a trade secret that is made (i) in confidence to a U.S. federal,
state, or local government official or to an attorney solely for the purpose of
reporting or investigating a suspected violation of law, or (ii) in a complaint
or other document filed in a lawsuit or other proceeding, if such filing is made
under seal, and (b) an individual who files a lawsuit for retaliation by an
employer for reporting a suspected violation of law may disclose the trade
secret to the attorney of the individual and use the trade secret information in
the court proceeding, if the individual files any document containing the trade
secret under seal; and does not disclose the trade secret, except pursuant to
court order. Moreover, a Partner shall not be required to give prior notice to
(or get prior authorization from) Blackstone regarding any such communication or
disclosure. Except as otherwise provided in this paragraph or under applicable
law, under no circumstance is any Partner authorized to disclose any information
covered by Blackstone or its affiliates’ attorney-client privilege or attorney
work product or Blackstone’s trade secrets without the prior written consent of
Blackstone.

Section 7.9 Notices. Whenever notice is required or permitted by this Agreement
to be given, such notice shall be in writing (including telecopy, email or
similar writing) and shall be given by hand delivery (including any courier
service) or telecopy or email to any Partner at its address, telecopy number or
email address shown in the Partnership’s books and records or, if given to the
General Partner or the Partnership, at the address of the Partnership provided
herein or at the telecopy number or email address of the Partnership furnished
to any Partner upon written request of such Partner. Each such notice shall be
effective (i) if given by telecopy or email, upon dispatch, and (ii) if given by
hand delivery, when delivered to the address of such Partner, the General
Partner or the Partnership specified as aforesaid.

Section 7.10 Counterparts. This Agreement may be executed in any number of
counterparts, all of which together shall constitute a single instrument.

Section 7.11 Power of Attorney. Each Partner (other than the General Partner)
hereby irrevocably appoints the General Partner as such Partner’s true and
lawful agent, representative and attorney-in-fact, each acting alone, in such
Partner’s name, place and stead, to make, execute, sign and file, on behalf of
such Partner, any and all agreements, instruments, documents and certificates
which the General Partner deems necessary or advisable in connection with any
transaction or matter contemplated by or provided for in this Agreement,
including without limitation, the performance of any obligation of such Partner
or the Partnership or the exercise of any right of such Partner or the
Partnership or an amendment to this Agreement or may be required by this
Agreement or by the laws of the United States of America, the State of Delaware
or any other state in which the Partnership shall determine to do

 

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business, or any political subdivision or agency thereof, to execute, implement
and continue the valid and subsisting existence of the Partnership. Such power
of attorney is coupled with an interest and shall survive and continue in full
force and effect notwithstanding the Withdrawal from the Partnership of any
Partner for any reason and shall not be affected by the death, Total Disability
or Incompetence of such Partner.

Section 7.12 Cumulative Remedies. Rights and remedies under this Agreement are
cumulative and do not preclude use of other rights and remedies available under
applicable law.

Section 7.13 Legal Fees. Except as more specifically provided herein, in the
event of a legal dispute (including litigation, arbitration or mediation)
between any Partner or Withdrawn Partner and the Partnership, arising in
connection with any provision of this Agreement, the “losing” party to such
dispute shall promptly reimburse the “victorious party” for all reasonable legal
fees and expenses incurred in connection with such dispute (such determination
to be made by the relevant adjudicator). Any amounts due under this Section 7.13
shall be paid within 30 days of the date upon which such amounts are due to be
paid and any amounts remaining unpaid after such date shall accrue interest at
the Default Interest Rate.

Section 7.14 Modifications. Except as provided herein, this Agreement may be
amended or modified at any time by the General Partner in its sole discretion
upon notification thereof to the Limited Partners.

Section 7.15 Entire Agreement. This Agreement embodies the entire agreement and
understanding of the parties hereto in respect of the subject matter contained
herein. There are no restrictions, promises, representations, warranties,
covenants or undertakings, other than those expressly set forth or referred to
herein. Subject to Section 7.4, this Agreement supersedes all prior agreements
and understandings between the parties with respect to such subject matter.

*     *     *     *     *

 

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IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the
day and year first above written. In the event that it is impracticable to
obtain the signature of any of the Partners to this Agreement, this Agreement
shall be binding among the other Partners executing the same.

 

GENERAL PARTNER: Blackstone Holdings III, L.P. By:   Blackstone Holdings III GP
L.P., its General Partner By:   Blackstone Holdings III GP Management L.L.C.,
its General Partner By:   /s/ John G. Finley Name:   John G. Finley Title:  
Chief Legal Officer and Secretary LIMITED PARTNERS AND SPECIAL PARTNERS All
Limited Partners and Special Partners now and hereafter admitted pursuant to
powers of attorney now and hereafter granted to Blackstone Holdings III L.P.
Blackstone Holdings III, L.P. By:   Blackstone Holdings III GP L.P., its General
Partner By:  

Blackstone Holdings III GP Management

L.L.C., its General Partner

By:   /s/ John G. Finley Name:   John G. Finley Title:   Chief Legal Officer and
Secretary

[Signature Page to Amended and Restated Limited Partnership Agreement of BREIT
Special Limited Partner L.P.]