Exhibit 10.43

 

 

 

BLACKSTONE REAL ESTATE SPECIAL SITUATIONS MANAGEMENT ASSOCIATES EUROPE L.P.

AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

Dated as of June 30, 2009

 

 

 

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Table of Contents

 

     Page

ARTICLE I DEFINITIONS

   1

Section 1.1.    Definitions

   1

Section 1.2.    Terms Generally

   17

ARTICLE II GENERAL PROVISIONS

   17

Section 2.1.    General Partner and Limited Partners

   17

Section 2.2.    Formation; Name

   18

Section 2.3.    Term

   18

Section 2.4.    Purpose; Powers

   18

Section 2.5.    Place of Business

   20

Section 2.6.    Feeder Vehicle

   20

ARTICLE III MANAGEMENT

   21

Section 3.1.    General Partners

   21

Section 3.2.    Limitations on Limited Partners

   21

Section 3.3.    Partner Voting

   21

Section 3.4.    Management

   21

Section 3.5.    Responsibilities of Partners

   21

Section 3.6.    Exculpation and Indemnification

   21

Section 3.7.    Representations of Limited Partners

   23

Section 3.8.    Tax Representation

   23

ARTICLE IV CAPITAL OF THE PARTNERSHIP

   24

Section 4.1.    Capital Contributions by Partners

   24

Section 4.2.    Interest

   31

Section 4.3.    Withdrawals of Capital

   31

ARTICLE V PARTICIPATION IN PROFITS AND LOSSES

   31

Section 5.1.    General Accounting Matters

   31

Section 5.2.    Capital Accounts

   33

Section 5.3.    GP-Related Profit Sharing Percentages

   33

Section 5.4.    Allocations of GP-Related Net Income (Loss)

   34

Section 5.5.    Liability of General Partners

   35

Section 5.6.    Liability of Limited Partners

   35

Section 5.7.    Repurchase Rights, etc.

   35

Section 5.8.    Distributions

   35

Section 5.9.    Business Expenses

   42

Section 5.10.    Tax Capital Accounts; Tax Allocations

   42

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

   42

Section 6.1.    Additional Partners

   42

Section 6.2.    Withdrawal of Partners

   43

Section 6.3.    GP-Related Partner Interests Not Transferable

   44

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Section 6.4.    General Partner Withdrawal; Transfer of General Partner’s
Interest

   45

Section 6.5.    Satisfaction and Discharge of a Withdrawn Partner’s Interest

   45

Section 6.6.    Termination of Partnership

   50

Section 6.7.    Certain Tax Matters

   50

Section 6.8.    Special Basis Adjustments

   51

ARTICLE VII Capital Commitment Interests; Capital Contributions; Allocations;
Distributions

   51

Section 7.1.    Capital Commitment Interests, etc.

   51

Section 7.2.    Capital Commitment Capital Accounts

   53

Section 7.3.    Allocations

   53

Section 7.4.    Distributions

   54

Section 7.5.    Valuations

   57

Section 7.6.    Disposition Election

   58

Section 7.7.    Capital Commitment Special Distribution Election

   58

ARTICLE VIII Withdrawal; Dissolution; Admission of New Partners

   59

Section 8.1.    Limited Partner Withdrawal; Repurchase of Capital Commitment
Interests

   59

Section 8.2.    Transfer of Limited Partner’s Capital Commitment Interest

   63

Section 8.3.    Compliance with Law

   63

ARTICLE IX DISSOLUTION

   63

Section 9.1.    Dissolution

   63

Section 9.2.    Final Distribution

   64

Section 9.3.    Amounts Reserved Related to Capital Commitment Partner Interests

   65

ARTICLE X MISCELLANEOUS

   65

Section 10.1.    Submission to Jurisdiction; Waiver of Jury Trial

   65

Section 10.2.    Ownership and Use of the Firm Name

   66

Section 10.3.    Written Consent

   67

Section 10.4.    Letter Agreements; Schedules

   67

Section 10.5.    Governing Law

   67

Section 10.6.    Successors and Assigns; Third Party Beneficiaries

   67

Section 10.7.    Partner’s Will

   68

Section 10.8.    Confidentiality

   68

Section 10.9.    Notices

   68

Section 10.10.    Counterparts

   68

Section 10.11.    Power of Attorney

   69

Section 10.12.    Cumulative Remedies

   69

Section 10.13.    Legal Fees

   69

Section 10.14.    Entire Agreement

   69

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BLACKSTONE REAL ESTATE SPECIAL SITUATIONS MANAGEMENT ASSOCIATES EUROPE L.P.

AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP of Blackstone Real Estate
Special Situations Management Associates Europe L.P. (the “Partnership”) dated
as of June 30, 2009, by and between Blackstone Real Estate Special Situations
Europe GP L.P., a Delaware limited partnership (“BSSF Europe GP Delaware”),
Blackstone Real Estate Special Situations Europe (Cayman) Ltd., a Cayman Islands
exempted limited company (“BSSF Europe (Cayman),” and together with BSSF Europe
GP Delaware, the “General Partners” or, collectively, the “General Partner”),
and the limited partners listed as Limited Partners in the books and records of
the Partnership, as limited partners.

PRELIMINARY STATEMENT

The Partnership was formed under the laws of Alberta, Canada pursuant to a
Certificate of Limited Partnership, dated as of May 19, 2009, which was filed
with the Registrar of Corporations (Alberta).

The original partnership agreement of the Partnership was executed as of May 19,
2009 (the “Original Agreement”).

The parties hereto now wish to amend and restate the Original Agreement in its
entirety as of the date hereof and as hereinafter set forth and to reflect the
withdrawal of the Initial Limited Partner.

Accordingly, the parties agree as follows:

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:

“Advancing Party” has the meaning set forth in Section 7.1(b).

“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.

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

“Alternative Vehicle” means any investment vehicle or structure formed pursuant
to paragraph 2.7.1 of the agreements referred to in clause (i) of the definition
of “BSSF Europe Agreement” in this Article I, or any other “Alternative Vehicle”
(as defined in any other BSSF Europe Agreement).

“Applicable Collateral Percentage,” with respect to any Firm Collateral or
Special Firm Collateral, has the meaning set forth in the books and records of
the Partnership with respect thereto.

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“Associates” means Blackstone Real Estate Special Situations Associates Europe
L.P., a Delaware limited partnership and the general partner of BSSF Europe.

“Bankruptcy” means, with respect to any person, the occurrence of any of the
following events: (i) the filing of an application by such person for, or a
consent to, the appointment of a trustee or custodian of his assets; (ii) the
filing by such person of a voluntary petition in Bankruptcy or the seeking of
relief under Title 11 of the United States Code, as now constituted or hereafter
amended, or the filing of a pleading in any court of record admitting in writing
his inability to pay his debts as they become due; (iii) the failure of such
person to pay his debts as such debts become due; (iv) the making by such person
of a general assignment for the benefit of creditors; (v) the filing by such
person of an answer admitting the material allegations of, or his consenting to,
or defaulting in answering, a Bankruptcy petition filed against him in any
Bankruptcy proceeding or petition seeking relief under Title 11 of the United
States Code, as now constituted or as hereafter amended; or (vi) the entry of an
order, judgment or decree by any court of competent jurisdiction adjudicating
such person a bankrupt or insolvent or for relief in respect of such person or
appointing a trustee or custodian of his assets and the continuance of such
order, judgment or decree unstayed and in effect for a period of 60 consecutive
days.

“BCE Agreement” means the limited partnership agreement, limited liability
company agreement or other governing document of any limited partnership,
limited liability company or other entity named or referred to in the definition
of any of “BFREP,” “BFIP,” “BFMEZP,” “BFCOMP” or “Other Blackstone Collateral
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, and any other
Blackstone Collateral Entity limited partnership agreement, limited liability
company agreement or other governing document.

“BCE Investment” means any direct or indirect investment by any Blackstone
Collateral Entity.

“BCOM” means the collective reference to (i) Blackstone Communications Partners
I L.P., a Delaware limited partnership, and (ii) any other investment vehicle
established pursuant to Article 2 of the partnership agreement for the
partnership referred to in clause (i) above.

“BCP VI” is the collective reference to (i) Blackstone Capital Partners VI L.P.,
a Delaware limited partnership, (ii) Blackstone Capital Partners VI-Executive
Fund L.P., a Delaware limited partnership, and (iii) any alternative investment
vehicle relating thereto and any parallel fund.

“BFCOMP” means Blackstone Family Communications Partnership I L.P., Blackstone
Family Communications Partnership I-SMD L.P. and any other entity that is an
Affiliate thereof and has terms substantially similar to those of the foregoing
partnerships and is formed in connection with the participation by one or more
partners thereof directly or indirectly in investments in securities also
purchased by BCOM or any other funds with substantially similar investment
objectives to BCOM and that are sponsored or managed by an Affiliate of the
General Partner (which includes serving as general partner of such funds).

 

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“BFIP” means Blackstone Capital Associates II L.P., Blackstone Capital
Associates III L.P., Blackstone Family Investment Partnership II L.P.,
Blackstone Family Investment Partnership III L.P., Blackstone Family Investment
Partnership IV-A L.P., Blackstone Family Investment Partnership IV-A -SMD L.P.,
Blackstone Family Investment Partnership V L.P., Blackstone Family Investment
Partnership V- SMD L.P., Blackstone Family Investment Partnership VI L.P.,
Blackstone Family Investment Partnership VI-SMD L.P., and any other entity that
is an Affiliate thereof and has terms similar to those of the foregoing
partnerships and is formed in connection with the participation by one or more
of the partners thereof in investments in securities also purchased by BCP VI or
any other fund with substantially similar investment objectives to BCP VI and
that are sponsored or managed by an Affiliate of the General Partner (which
includes serving as general partner of such funds).

“BFMEZP” means Blackstone Family Mezzanine Partnership-SMD L.P., Blackstone
Family Mezzanine Partnership II-SMD L.P., Blackstone Mezzanine Holdings L.P.,
Blackstone Mezzanine Holdings II L.P., any entity formed to invest side-by-side
with any GSO Fund and any other entity that is an Affiliate thereof and that has
terms substantially similar to those of the foregoing partnerships or other
entities and is formed in connection with the participation by one or more
partners or other equity owners thereof directly or indirectly in investments in
securities also purchased by BMEZP I, BMEZP II, any GSO Fund or any other funds
with substantially similar investment objectives to BMEZP I, BMEZP II or any GSO
Fund and that are sponsored or managed by an Affiliate of the General Partner
(which includes serving as general partner of such funds).

“BFREP” means Blackstone Real Estate Capital Associates L.P., Blackstone Real
Estate Capital Associates II L.P., Blackstone Real Estate Capital Associates III
L.P., Blackstone Family Real Estate Partnership L.P., Blackstone Family Real
Estate Partnership II L.P., Blackstone Family Real Estate Partnership III L.P.,
Blackstone Family Real Estate Partnership International-A-SMD L.P., Blackstone
Family Real Estate Partnership IV-SMD L.P., Blackstone Family Real Estate
Partnership International II-SMD L.P., Blackstone Family Real Estate Partnership
V-SMD L.P., Blackstone Family Real Estate Partnership VI-SMD L.P., Blackstone
Family Real Estate Partnership Europe III-SMD L.P., Blackstone Family Real
Estate Special Situations Partnership - SMD L.P., , Blackstone Family Real
Estate Special Situations Partnership Europe - SMD L.P., Blackstone Real Estate
Holdings L.P., Blackstone Real Estate Holdings II L.P., Blackstone Real Estate
Holdings III L.P., Blackstone Real Estate Holdings International - A L.P.,
Blackstone Real Estate Holdings IV L.P., Blackstone Real Estate Holdings
International II L.P., Blackstone Real Estate Holdings V L.P., Blackstone Real
Estate Holdings VI L.P., Blackstone Real Estate Holdings Europe III L.P.,
Blackstone Real Estate Special Situations Holdings II L.P., Blackstone Real
Estate Special Situations Holdings Europe L.P. and any other entity that is an
Affiliate thereof and that has terms substantially similar to those of the
foregoing partnerships and is formed in connection with the participation by one
or more partners thereof in real estate and real estate-related investments also
purchased by BREP VI, BSSFF II or BSSFF Europe and any other funds with
substantially similar investment objectives to BREP VI, BSSFF II or BSSFF Europe
and that are sponsored or managed by an Affiliate of the General Partner (which
includes serving as general partner of such funds).

“Blackstone” means collectively, The Blackstone Group L.P., a Delaware limited
partnership, and any Affiliate thereof (excluding any natural persons and any
portfolio companies of any Blackstone-sponsored fund).

“Blackstone Co-Investment Rights” has the meaning set forth in the BSSF Europe
Agreement.

 

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“Blackstone Collateral Entity” means any limited partnership, limited liability
company or other entity named or referred to in the definition of any of
“BFREP,” “BFIP,” “BFMEZP,” “BFCOMP” or “Other Blackstone Collateral Entity.”

“Blackstone Commitment” has the meaning set forth in the BSSF Europe Agreement.

“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 L.P.

“BMEZP I” means (i) Blackstone Mezzanine Partners L.P., a Delaware limited
partnership, and (ii) any other investment vehicle established pursuant to
Article 2 of the partnership agreement for the partnership referred to in clause
(i) above.

“BMEZP II” means (i) Blackstone Mezzanine Partners II L.P., a Delaware limited
partnership, and (ii) any other investment vehicle established pursuant to
Article 2 of the partnership agreement for the partnership referred to in clause
(i) above.

“BREP VI” means (i) Blackstone Real Estate Partners VI L.P., Blackstone Real
Estate Partners VI.TE.1 L.P., Blackstone Real Estate Partners VI.TE.2 L.P. and
Blackstone Real Estate Partners VI.F L.P., each a Delaware limited partnership,
(ii) any other Parallel Funds or other Supplemental Capital Vehicles (each as
defined in the respective partnership agreements for the partnerships referred
to in clause (i) above), or (iii) any other investment vehicle established
pursuant to Article 2 of the respective partnership agreements for any of the
partnerships referred to in clause (i) above.

“BSSF Europe” means (i) Blackstone Real Estate Special Situations Europe L.P.,
Blackstone Real Estate Special Situations Europe.1 L.P. and Blackstone Real
Estate Special Situations Europe.2 L.P., each a limited partnership formed or to
be formed under the laws of the United Kingdom pursuant to the Limited
Partnerships Act 1907 of the United Kingdom, (ii) any Alternative Vehicle,
Parallel Fund or other investment vehicle established pursuant to Article 2 of
the partnership agreements for the partnerships referred to in clause (i) above,
and (iii) any investment vehicle formed to co-invest with any of the
partnerships referred to in clause (i) above using third party capital and that
potentially pays Carried Interest Distributions (as such term is used in such
partnership agreements).

“BSSF Europe Agreement” or “BSSF Europe Agreements” means (i) the Amended and
Restated Agreements of Limited Partnership dated as of the respective dates set
forth therein, of each of the partnerships referred to in clause (i) of the
definition of “BSSF Europe” in this Article I, as such agreement may be amended
supplemented or otherwise modified from time to time, and (ii) any other BSSF
Europe partnership agreement.

“BSSF Europe (Cayman)” means Blackstone Real Estate Special Situations Europe
(Cayman) Ltd., a Cayman Islands exempted limited company and a general partner
of the Partnership.

“BSSF Europe GP Delaware” means Blackstone Real Estate Special Situations Europe
GP L.P., a Delaware limited partnership and a general partner of the
Partnership.

 

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“BSSF II” means (i) Blackstone Real Estate Special Situations Fund II L.P., a
Delaware limited partnership, (ii) Blackstone Real Estate Special Situations
Fund II.1 L.P., a Delaware limited partnership, and (iii) Blackstone Real Estate
Special Situations Fund II.2 L.P., a Delaware limited partnership, and any
alternative vehicles thereof or parallel funds formed in connection therewith.

“Capital Commitment Associates Partner Interest” means the Partnership’s
interest in Associates with respect to the Capital Commitment BSSF Europe
Interest.

“Capital Commitment BSSF Europe Commitment” means Associates’ Commitment (as
defined in the BSSF Europe Agreement) to BSSF Europe that relates solely to the
Capital Commitment BSSF Europe Interest.

“Capital Commitment BSSF Europe Interest” means the Interest (as defined in the
BSSF Europe Agreement) of Associates, if any, as a capital partner in BSSF
Europe.

“Capital Commitment BSSF Europe Investment” means the Partnership’s indirect
interest in Associates’ indirect interest in a specific investment of BSSF
Europe pursuant to the BSSF Europe Agreements in Associates’ capacity as a
capital partner of BSSF Europe, but does not include any GP-Related Investment.

“Capital Commitment Capital Account” means, with respect to each Capital
Commitment Investment for each Partner, the account maintained for such Partner
to which are credited such Partner’s contributions to the Partnership with
respect to such Capital Commitment Investment and any net income allocated to
such Partner pursuant to Section 7.3 with respect to such Capital Commitment
Investment and from which are debited any distributions with respect to such
Capital Commitment Investment to such Partner and any net losses allocated to
such Partner with respect to such Capital Commitment Investment pursuant to
Section 7.3. In the case of any such distribution in kind, the Capital
Commitment Capital Accounts for the related Capital Commitment Investment shall
be adjusted as if the asset distributed had been sold in a taxable transaction
and the proceeds distributed in cash, and any resulting gain or loss on such
sale shall be allocated to the Partners participating in such Capital Commitment
Investment pursuant to Section 7.3.

“Capital Commitment Class A Interest” has the meaning set forth in
Section 7.4(f).

“Capital Commitment Class B Interest” has the meaning set forth in
Section 7.4(f).

“Capital Commitment Defaulting Party” has the meaning specified in
Section 7.4(g).

“Capital Commitment Deficiency Contribution” has the meaning specified in
Section 7.4(g).

“Capital Commitment Disposable Investment” has the meaning set forth in
Section 7.4(f).

“Capital Commitment Distributions” means, with respect to each Capital
Commitment Investment, all amounts of distributions, received by the Partnership
with respect to such Capital Commitment Investment solely in respect of the
Partnership’s Capital Commitment Associates Partner Interest, less any costs,
fees and expenses of the Partnership with respect thereto and less reasonable
reserves for payment of costs, fees and expenses of the Partnership that are
anticipated with respect thereto, in each case which the General Partner may
allocate to all or any portion of such Capital Commitment Investment as it may
determine in good faith is appropriate.

 

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“Capital Commitment Giveback Amount” has the meaning set forth in
Section 7.4(g).

“Capital Commitment Interest” means the interest of a Partner in a specific
Capital Commitment Investment as provided herein.

“Capital Commitment Investment” means any Capital Commitment BSSF Europe
Investment, but shall exclude any GP-Related Investment. The General Partner
shall determine who may participate in such Capital Commitment Investment.

“Capital Commitment Liquidating Share” with respect to each Capital Commitment
Investment means, in the case of dissolution of the Partnership, the related
Capital Commitment Capital Account of a Partner (less amounts reserved in
accordance with Section 9.3) as of the close of business on the effective date
of dissolution.

“Capital Commitment Net Income (Loss)” with respect to each Capital Commitment
Investment means all amounts of income received by the Partnership with respect
to such Capital Commitment Investment, including without limitation gain or loss
in respect of the disposition, in whole or in part, of such Capital Commitment
Investment, less any costs, fees and expenses of the Partnership allocated
thereto and less reasonable reserves for payment of costs, fees and expenses of
the Partnership anticipated to be allocated thereto; provided, that any income
received in respect of the Partnership’s Capital Commitment Associates Partner
Interest that is unrelated to any Capital Commitment Investment (as determined
by the General Partner in its sole discretion) shall be allocated to the
Partners in accordance with their Capital Commitment Profit Sharing Percentages.

“Capital Commitment Partner Interest” means a Partner’s interest in the
Partnership with respect to the Partnership’s Capital Commitment Associates
Partner Interest.

“Capital Commitment Profit Sharing Percentage” with respect to each Capital
Commitment Investment means the percentage interest of a Partner in Capital
Commitment Net Income (Loss) from such Capital Commitment Investment set forth
in the books and records of the Partnership.

“Capital Commitment Recontribution Amount” has the meaning set forth in
Section 7.4(g).

“Capital Commitment-Related Capital Contributions” has the meaning set forth in
Section 7.1(a).

“Capital Commitment-Related Commitment”, with respect to any Partner, means such
Partner’s commitment to the Partnership relating to such Partner’s Capital
Commitment Partner Interest, as set forth in the books and records of the
Partnership, including any such commitment set forth in such Partner’s
Commitment Agreement.

“Capital Commitment Special Distribution” has the meaning set forth in
Section 7.7(a).

“Capital Commitment Value” has the meaning set forth in Section 7.5.

 

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“Carried Interest” means (i) “Carried Interest Distributions” (as defined in the
BSSF Europe Agreements), and (ii) any other carried interest payable pursuant to
any BSSF Europe Agreement. In the case of each of (i) and (ii) above, the amount
shall be less any costs, fees and expenses of the Partnership with respect
thereto and less reasonable reserves for payment of costs, fees and expenses of
the Partnership that are anticipated with respect thereto (in each case which
the General Partner may allocate among all or any portion of the GP-Related
Investments as it determines in good faith is appropriate).

“Carried Interest Give Back Percentage” means, for any Partner or Withdrawn
Partner, subject to Section 5.8(e), the percentage determined by dividing
(A) the aggregate amount of distributions received by such Partner or Withdrawn
Partner from the Partnership, any Other Fund GPs or their Affiliates (other than
Holdings), in respect of Carried Interest by (B) the aggregate amount of
distributions made to all Partners, Withdrawn Partners or any other person by
the Partnership, any Other Fund GP or their Affiliates (other than Holdings) (in
any capacity), in respect of Carried Interest. For purposes of determining any
“Carried Interest Give Back Percentage” hereunder, all Trust Amounts contributed
to the Trust by the Partnership, Other Fund GPs or their Affiliates (other than
Holdings) on behalf of a Partner or Withdrawn Partner (but not the Trust Income
thereon) shall be deemed to have been initially distributed or paid to the
Partners and Withdrawn Partners as Partners or partners of the Partnership, any
of the Other Fund GPs or their Affiliates (other than Holdings).

“Carried Interest Sharing Percentage” means, with respect to each GP-Related
Investment, the percentage interest of a Partner in Carried Interest from such
GP-Related Investment set forth in the books and records of the Partnership.

“Cause” means the occurrence or existence of any of the following with respect
to any 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 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 (z) such Partner’s committing
to or engaging in any conduct or behavior that is or may be harmful to the
Partnership 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 fifteen days after the General Partner becomes aware of such action and
such Partner fails to cure such breach, failure to perform or conduct or
behavior within fifteen days after receipt of such Notice of Breach from the
General Partner (or such longer period, not to exceed an additional fifteen
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
(iii) conviction (on the basis of a trial or by an accepted plea of guilty or
nolo contendere) of a felony 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 Partnership.

 

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“CC Carried Interest” means, with respect to any Limited Partner, the aggregate
amount of distributions or payments received by such Limited Partner (in any
capacity) from Affiliates of the Partnership in respect of or relating to
“carried interest”, including the amount of any bonuses received by a Limited
Partner as an employee of an Affiliate of the Partnership that relate to the
amount of “carried interest” received by an Affiliate of the Partnership. “CC
Carried Interest” includes any amount initially received by an Affiliate of the
Partnership from any fund (including BSSF Europe, any similar funds formed prior
to or after the date hereof, and any other private equity merchant banking, real
estate or debt funds, whether or not in existence as of the date hereof) to
which such Affiliate serves as general partner (or other similar capacity) that
exceeds such Affiliate’s pro rata share of distributions from such fund based
upon capital contributions thereto (or the capital contributions to make the
investment of such fund giving rise to such “carried interest”).

“Clawback Adjustment Amount” has the meaning set forth in Section 5.8(e).

“Clawback Amount” means the “Clawback Amount” and the “Interim Clawback Amount,”
both as set forth in Article One of the BSSF Europe Agreement, and any other
clawback amount payable to the limited partners of or investors in BSSF Europe
pursuant to any BSSF Europe Agreement, as applicable.

“Clawback Provisions” means paragraphs 4.2.9 and 9.2.7 of the BSSF Europe
Agreement and any other similar provisions in any BSSF Europe Agreement existing
heretofore or hereafter entered into.

“Code” means the United States 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.

“Commitment Agreement” means a commitment agreement, pursuant to which a Partner
has committed to fund certain amounts with respect to the GP-Related BSSF Europe
Investments, the Capital Commitment BSSF Europe Investments and certain expenses
of BSSF Europe.

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

“Covered Person” has the meaning set forth in Section 3.6(a).

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 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.

“Deceased Partner” means any Partner or Withdrawn Partner who has died or who
suffers from Incompetence. For purposes hereof, references to a Deceased Partner
shall refer collectively to the Deceased Partner and the estate and heirs or
legal representative of such Deceased Partner, as the case may be, that have
received such Deceased Partner’s interest in the Partnership.

 

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“Default Rate” means the lower of (i) the sum of (a) the rate of interest per
annum publicly announced from time to time by JPMorgan Chase Bank, N.A. as its
prime rate and (b) 5%, or (ii) the highest rate of interest permitted under
applicable law.

“Delaware LLC GP” means Blackstone Real Estate Special Situations Europe GP
L.L.C., a Delaware limited liability company.

“Disabling Event” means (a) the withdrawal of a General Partner, other than in
accordance with Section 6.2(b)(ii), (b) the incapacity of a General Partner,
(c) a General Partner (i) makes an assignment for the benefit of its creditors,
(ii) files a voluntary petition in bankruptcy, (iii) is adjudged a bankrupt or
insolvent or has entered against it an order for relief in any bankruptcy or
insolvency proceeding, (iv) files a petition or answer seeking for itself any
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under any statute, law or regulation, (v) files an answer or
other pleading admitting or failing to contest the material allegations of a
petition filed against it in proceeding described in clause (iv), or (v) seeks,
consents to, or acquiesces in, the appointment of a trustee, receiver or
liquidator of the General Partner or of all or substantially all of its
properties, or (d) any other event that causes the General Partner to cease to
be a general partner of the Partnership as provided in the Partnership Act.

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

“Excess Holdback” has the meaning set forth in Section 4.1(d).

“Excess Holdback Percentage” has the meaning set forth in Section 4.1(d).

“Excess Tax-Related Amount” has the meaning set forth in Section 5.8(e).

“Existing Partner” means any Partner who is neither a Retaining Withdrawn
Partner nor a Deceased Partner.

“Feeder Vehicle” means any Limited Partner formed to serve as a collective
investment vehicle for real estate-related investments in the United Kingdom
which invests all or a portion of its investable resources in the Partnership.

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

“Firm Advances” has the meaning set forth in Section 7.1.

“Firm Collateral” means a Partner’s or Withdrawn Partner’s interest in one or
more partnerships or limited liability companies, in either case affiliated with
the Partnership, and certain other assets of such Partner or Withdrawn Partner,
in each case that has been pledged or made available to the Trustee(s) to
satisfy all or any portion of the Excess Holdback of such Partner or Withdrawn
Partner as more fully described in the books and records of the Partnership;
provided, that for all purposes hereof (and any other agreement (e.g., the Trust
Agreement) that incorporates the meaning of the term “Firm Collateral” by
reference), references to “Firm Collateral” shall include “Special Firm
Collateral”, excluding references to “Firm Collateral” in Section 4.1(d)(v) and
Section 4.1(d)(viii).

 

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“Firm Collateral Realization” has the meaning set forth in Section 4.1(d)(v)(B)
with respect to Firm Collateral, and Section 4.1(d)(v)(B) with respect to
Special Firm Collateral.

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

“Fund GP” means the Partnership (only with respect to the Partnership’s
GP-Related Associates Partner Interest) and the Other Fund GPs.

“GAAP” means U.S. generally accepted accounting principles.

“General Partner” or “General Partners” means BSSF Europe (Cayman) and BSSF
Europe GP Delaware and any person admitted to the Partnership as an additional
General Partner in accordance with the provisions of this Agreement (until such
time as such person ceases to be a general partner of the Partnership as
provided herein or in the Partnership Act), subject to the provisions of
Section 3.4.

“Giveback” means an “Investment Specific Giveback,” as such term is defined in
the BSSF Europe Agreement.

“Giveback Amount” means an “Investment Specific Giveback Amount,” as such term
is defined in the BSSF Europe Agreement.

“Giveback Provisions” means paragraph 3.4.3 of the BSSF Europe Agreement and any
other similar provisions in any BSSF Europe Agreement existing heretofore or
hereafter entered into.

“GP-Related Associates Partner Interest” means the Partnership’s interest in
Associates with respect to the GP-Related BSSF Europe Interest.

“GP-Related BSSF Europe Interest” means the interest of Associates in BSSF
Europe as general partner of BSSF Europe, excluding any Capital Commitment BSSF
Europe Interest.

“GP-Related BSSF Europe Investment” means the Partnership’s indirect interest in
Associates’ indirect interest in an Investment (for purposes of this definition,
as defined in the BSSF Europe Partnership Agreement) in Associates’ capacity as
the general partner of BSSF Europe, but does not include any Capital Commitment
Investment.

“GP-Related Capital Account” has the meaning set forth in Section 5.2.

“GP-Related Capital Contributions” means capital contributions to the
Partnership as are necessary to fund the amounts required to satisfy the
Partnership’s obligations to make capital contributions to Associates to satisfy
Associates’ obligations to make capital contributions to BSSF Europe in respect
of the GP-Related BSSF Europe Interest, as determined by the General Partner
from time to time.

“GP-Related Class A Interest” has the meaning set forth in Section 5.8(a).

“GP-Related Class B Interest” has the meaning set forth in Section 5.8(a).

 

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“GP-Related Commitment”, with respect to any Partner, means such Partner’s
commitment to the Partnership relating to such Partner’s GP-Related Partner
Interest, as set forth in the books and records of the Partnership, including,
without limitation, any such commitment that may be set forth in such Partner’s
Commitment Agreement or SMD Agreement, if any.

“GP-Related Defaulting Party” has the meaning set forth in Section 5.8(d).

“GP-Related Deficiency Contribution” has the meaning set forth in
Section 5.8(d).

“GP-Related Disposable Investment” has the meaning set forth in Section 5.8(a).

“GP-Related Giveback Amount” has the meaning set forth in Section 5.8(d).

“GP-Related Investment” means any investment (direct or indirect) of the
Partnership in respect of the Partnership’s GP-Related Associates Partner
Interest (including, without limitation, any GP-Related BSSF Europe Investment
but excluding any Capital Commitment Investment).

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

“GP-Related Partner Interest” of a Partner means all interests of such Partner
in the Partnership (other than such Partner’s Capital Commitment Partner
Interest), including, without limitation, such Partner’s interest in the
Partnership with respect to the Partnership’s GP-Related Associates Partner
Interest and with respect to all GP-Related Investments.

“GP-Related Profit Sharing Percentage” means the “Carried Interest Sharing
Percentage” and “Non-Carried Interest Sharing Percentage” of each Partner;
provided that any reference in this Agreement to any GP-Related Profit Sharing
Percentage that specifically refers to GP-Related Net Income unrelated to BSSF
Europe shall continue to refer to the amount of each Partner’s percentage
interest in a category of GP-Related Net Income (Loss) established by the
General Partner from time to time pursuant to Section 5.3; provided further
that, the term “GP-Related Profit Sharing Percentage” shall not include any
Capital Commitment Profit Sharing Percentage.

“GP-Related Recontribution Amount” has the meaning set forth in Section 5.8(d).

“GP-Related Required Amounts” means amounts equal to the Partnership’s portion
of the required capital contribution in respect of any GP-Related BSSF Europe
Investment to be made by the general partner of BSSF Europe (including, without
limitation, Associates), as determined by the General Partner from time to time,
which amounts shall be used by the Partnership to fund capital contributions to
the general partner of BSSF Europe (including, without limitation, Associates).

“GP-Related Unallocated Percentage” has the meaning set forth in Section 5.3(b).

“GP-Related Unrealized Net Income (Loss)” attributable to any GP-Related BSSF
Europe Investment as of any date means the GP-Related Net Income (Loss) that
would be realized by the Partnership with respect to such GP-Related BSSF Europe
Investment if BSSF Europe’s entire portfolio of investments were sold on such
date for cash in an amount equal to their aggregate value on such date
(determined in accordance with Section 5.1(e)) and all distributions payable by
BSSF Europe to the Partnership (indirectly through the general partner of

 

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BSSF Europe) pursuant to the BSSF Europe Agreement with respect to such
GP-Related BSSF Europe Investment were made on such date. “GP-Related Unrealized
Net Income (Loss)” attributable to any other GP-Related Investment (other than
any Capital Commitment Investment) as of any date means the GP-Related Net
Income (Loss) that would be realized by the Partnership with respect to such
GP-Related Investment if such GP-Related Investment were sold on such date for
cash in an amount equal to its value on such date (determined in accordance with
Section 5.1(e)).

“GSO Fund” means (i) any of GSO Capital Opportunities Fund LP, GSO Capital
Opportunities Overseas Fund L.P., GSO Capital Opportunities Overseas Master Fund
L.P., GSO Liquidity Partners LP, GSO Liquidity Overseas Partners LP, Blackstone
/ GSO Capital Solutions Fund LP, Blackstone / GSO Capital Solutions Overseas
Fund L.P. and Blackstone / GSO Capital Solutions Overseas Master Fund L.P., or
(ii) any alternative vehicle or parallel fund relating to any of the
partnerships referred to in clause (i) above.

“Holdback” has the meaning set forth in Section 4.1(d).

“Holdback Percentage” has the meaning set forth in Section 4.1(d).

“Holdback Vote” has the meaning set forth in Section 4.1(d).

“Holdings” means Blackstone Holdings IV L.P., a societé en commandite organized
in Québec.

“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 person or his
property.

“Inflation Index” means (i) the GNP deflator, which is the fixed-weighted price
index representing the average change in the United States gross national
product as published in the Survey of Current Business by the National Income
and Wealth Division of the Bureau of Economic Analysis of the U.S. Department of
Commerce, or (ii) such other index measuring changes in economic prices in the
United States as shall be selected by the General Partner.

“Initial Holdback Percentages” has the meaning set forth in Section 4.1(d).

“Initial Limited Partner” means Christopher J. James.

“Interest” means a Partner’s interest in the Partnership, including such
Partner’s GP-Related Partner Interest (including, without limitation, that which
is held by a Retaining Withdrawn Partner) and Capital Commitment Partner
Interest.

“Investment” means any investment (direct or indirect) of the Partnership
designated by the General Partner from time to time as an investment in which
the Partners’ respective interests shall be established and accounted for on a
basis separate from the Partnership’s other businesses, activities and
investments, including (a) GP-Related Investments, and (b) Capital Commitment
Investments.

“Investor Limited Partner” means any Limited Partner so designated at the time
of its admission as a partner of the Partnership.

 

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“Investor Note” means a promissory note of a Partner evidencing indebtedness
incurred by such Partner to purchase a Capital Commitment Interest, the terms of
which were or are approved by the General Partner and which is secured by such
Capital Commitment Interest, all other Capital Commitment Interests of such
Partner and all other interests of such Partner in Blackstone Collateral
Entities; provided, that such promissory note may also evidence indebtedness
relating to other interests of such Partner in Blackstone Collateral Entities,
and such indebtedness shall be prepayable with Capital Commitment Net Income
(whether or not such indebtedness relates to Capital Commitment Investments) as
set forth in this Agreement, the Investor Note, the other BCE Agreements and any
documentation relating to Other Sources; provided further, that references to
“Investor Notes” herein refer to multiple loans made pursuant to such note,
whether made with respect to Capital Commitment Investments or other BCE
Investments, and references to an “Investor Note” refer to one such loan as the
context requires. In no way shall any indebtedness incurred to acquire Capital
Commitment Interests or other interests in Blackstone Collateral Entities be
considered part of the Investor Notes for purposes hereof if the Lender or
Guarantor is not the lender or guarantor with respect thereto.

“Issuer” means the issuer of any Security comprising part of an Investment.

“L/C” has the meaning set forth in Section 4.1(d).

“L/C Partner” has the meaning set forth in Section 4.1(d).

“Lender or Guarantor” means Blackstone, in its capacity as lender or guarantor
under the Investor Notes, including any Affiliate of the General Partner that
makes or guarantees loans to enable a Partner to acquire Capital Commitment
Interests or other interests in Blackstone Collateral Entities.

“Limited Partner” means any of the persons who is shown on the books and records
of the Partnership as a Limited Partner of the Partnership, including any
Special Limited Partner, any Investor Limited Partner and any Nonvoting Limited
Partner.

“Loss Amount” has the meaning set forth in Section 5.8(e).

“Loss Investment” has the meaning set forth in Section 5.8(e).

“Majority in Interest of the Partners” on any date (a “vote date”) means one or
more persons who are Partners (including the General Partner and the Special
Limited Partners but excluding Nonvoting Limited 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 as of which the Partners’ GP-Related Capital Account
balances can be determined), have aggregate GP-Related Capital Account balances
representing at least a majority in amount of the total GP-Related Capital
Account balances of all the persons who are Partners (including the General
Partner and the Special Limited Partners but excluding Nonvoting Limited
Partners) on the vote date.

“Moody’s” means Moody’s Investor Services, Inc., or any successor thereto.

“Net Carried Interest Distribution” has the meaning set forth in Section 5.8(e).

“Net Carried Interest Distribution Recontribution Amount” has the meaning set
forth in Section 5.8(e).

 

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“Net GP-Related Recontribution Amount” has the meaning set forth in
Section 5.8(d).

“Non-Carried Interest” means, with respect to each GP-Related Investment
(including any GP-Related BSSF Europe Investment), all amounts of distributions,
other than Carried Interest and other than Capital Commitment Distributions,
received by the Partnership with respect to such GP-Related Investment
(including any GP-Related BSSF Europe Investment), less any costs, fees and
expenses of the Partnership with respect thereto and less reasonable reserves
for payment of costs, fees and expenses of the Partnership that are anticipated
with respect thereto, in each case which the General Partner may allocate to all
or any portion of the GP-Related Investments (including any GP-Related BSSF
Europe Investment) as it may determine in good faith is appropriate.

“Non-Carried Interest Sharing Percentage” means, with respect to each GP-Related
Investment (including GP-Related BSSF Europe Investments), the percentage
interest of a Partner in Non-Carried Interest from such GP-Related Investment
(including GP-Related BSSF Europe Investments) set forth in the books and
records of the Partnership.

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

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

“Original Agreement” has the meaning set forth in the Preamble.

“Other Blackstone Collateral Entity” means any Blackstone Entity (other than any
limited partnership, limited liability company or other entity named or referred
to in the definition of any of “BFREP,” “BFIP,” “BFMEZP” or “BFCOMP”) in which
any limited partner interest, limited liability company interest, unit or other
interest is pledged to secure any Investor Note.

“Other Fund GPs” means BSSF Europe GP Delaware, the Delaware LLC GP, Associates
(only with respect to Associates’ GP-Related BSSF Europe Interest) and any other
entity (other than the Partnership) through which any Partner, Withdrawn Partner
or any other person directly receives any amounts of Carried Interest, and any
successor thereto; provided, that this includes any other entity which has in
its organizational documents a provision which indicates that it is a “Fund GP”
or an “Other Fund GP”; provided further, that notwithstanding the foregoing,
none of Holdings, any estate planning vehicles established for the benefit of
family members of any Partner or of any member or partner of any Other Fund GP
shall be considered an “Other Fund GP” for purposes hereof; provided further,
that the foregoing exclusion of such estate planning vehicles shall in no way
limit such Partners’ obligations pursuant to Section 5.8(d).

“Other Sources” means (i) distributions or payments of CC Carried Interest
(which shall include amounts of CC Carried Interest which are not distributed or
paid to a Limited Partner but are instead contributed to a trust (or similar
arrangement) to satisfy any “holdback” obligation with respect thereto),
(ii) bonuses paid by Blackstone to a Limited Partner (not covered by clause
(i) above) and (iii) distributions from Blackstone Collateral Entities (other
than the Partnership) to such Limited Partner.

“Parallel Fund” means any additional collective investment vehicles (or other
similar arrangements) formed pursuant to paragraph 2.8 of the BSSF Europe
Agreements.

 

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“Partner” means any person who is a partner of the Partnership, whether a
General Partner or a Limited Partner in whatsoever Partner Category.

“Partner Category” means the Existing Partners, Retaining Withdrawn Partners or
Deceased Partners, each referred to as a group for purposes hereof.

“Partnership” means Blackstone Real Estate Special Situations Management
Associates Europe L.P., an Alberta, Canada limited partnership.

“Partnership Act” means the Partnership Act (Revised Statutes of Alberta, 2000,
C, P.-3, et seq.), as it may be amended from time to time, and any successor to
such statute.

“Pledgable Blackstone Interests” has the meaning set forth in Section 4.1(a).

“Prime Rate” means the rate of interest per annum publicly announced from time
to time by JPMorgan Chase Bank, N.A. as its prime rate.

“Qualifying Fund” means any fund designated by the General Partner as a
“Qualifying Fund.”

“Required Rating” has the meaning set forth in Section 4.1(d).

“Repurchase Period” has the meaning set forth in Section 5.8(c).

“Retained Portion” has the meaning set forth in Section 7.7.

“Retaining Withdrawn Partner” means a Withdrawn Partner who has retained a
GP-Related Partner Interest in the Partnership, pursuant to Section 6.5(f) or
otherwise. A Retaining Withdrawn Partner shall be considered a Partner for all
purposes hereof.

“Securities” means any debt or equity securities of an issuer and its
subsidiaries and other Controlled Entities constituting part of an Investment,
including without limitation common and preferred stock, interests in limited
partnerships and interests in limited liability companies (including warrants,
rights, put and call options and other options relating thereto or any
combination thereof), notes, bonds, debentures, trust receipts and other
obligations, instruments or evidences of indebtedness, choses in action, other
property or interests commonly regarded as securities, interests in real
property, whether improved or unimproved, interests in oil and gas properties
and mineral properties, short-term investments commonly regarded as money-market
investments, bank deposits and interests in personal property of all kinds,
whether tangible or intangible.

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

“SMD Agreements” means the agreements between the Partnership and/or one or more
of its Affiliates and certain of the Partners, pursuant to which each such
Partner undertakes certain obligations with respect to the Partnership and/or
its Affiliates. The SMD Agreements are hereby incorporated by reference as
between the Partnership and the relevant Partner.

 

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“Special Firm Collateral” means interests in a Qualifying Fund that have been
pledged to the Trustee(s) to satisfy all or any portion of a Partner’s or
Withdrawn Partner’s Holdback obligation (excluding any Excess Holdback) as more
fully described in the books and records of the Partnership.

“Special Firm Collateral Realization” has the meaning set forth in
Section 4.1(d).

“Special Limited Partner” means any of the persons shown in the books and
records of the Partnership as a Special Limited Partner and any person admitted
to the Partnership as an additional Special Limited Partner in accordance with
the provisions of this Agreement.

“S&P” means Standard & Poor’s Ratings Group, and any successor thereto.

“Subject Investment” has the meaning set forth in Section 5.8(e).

“Subject Partner” has the meaning set forth in Section 4.1(d).

“Successor in Interest” means any (i) shareholder of; (ii) trustee, custodian,
receiver or other person acting in any Bankruptcy or reorganization proceeding
with respect to; (iii) assignee for the benefit of the creditors of;
(iv) officer, director or partner of; (v) trustee or receiver, or former
officer, director or partner, or other fiduciary acting for or with respect to
the dissolution, liquidation or termination of; or (vi) other executor,
administrator, committee, legal representative or other successor or assign of,
any Partner, whether by operation of law or otherwise.

“Tax Matters Partner” has the meaning set forth in Section 6.7(b).

“TM” has the meaning set forth in Section 10.2

“Total Disability” means the inability of a Limited Partner substantially to
perform the obligations 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.

“Transfer” has the meaning set forth in Section 8.2.

“Trust Account” has the meaning set forth in the Trust Agreement.

“Trust Agreement” means the Trust Agreement dated as of the date set forth
therein, as amended to date, among the Partners, the Trustee(s) and certain
other persons that may receive distributions in respect of or relating to
Carried Interest from time to time.

“Trust Amount” has the meaning set forth in the Trust Agreement.

“Trust Income” has the meaning set forth in the Trust Agreement.

“Trustee(s)” has the meaning set forth in the Trust Agreement.

“Unadjusted Carried Interest Distributions” has the meaning set forth in
Section 5.8(e).

“Unallocated Capital Commitment Interests” has the meaning set forth in
Section 8.1(f).

 

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“Unfunded Capital Commitment-Related Commitment” has the meaning set forth in
Section 7.1(ii).

“Unfunded Commitment” has the meaning set forth in Section 7.1(ii).

“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, disability, removal, resignation or retirement,
whether such is voluntary or involuntary), unless the context shall limit the
type of withdrawal to a specific reason and subject to any written agreements
between a Partner and the Partnership or any Affiliate thereof, and “Withdrawn”
with respect to a Partner means, as aforesaid, a Partner who has ceased to be a
partner of the Partnership.

“Withdrawal Date” means the date of the Withdrawal from the Partnership of a
Withdrawn Partner.

“Withdrawn Partner” means a Limited 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 representative of any such Partner.

“W-8BEN” has the meaning set forth in Section 3.8.

“W-8IMY” has the meaning set forth in Section 3.8.

“W-9” has the meaning set forth in Section 3.8.

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. General Partner and Limited Partners. The Partners may be General
Partners or Limited Partners. The General Partners are BSSF Europe (Cayman) and
BSSF Europe GP Delaware. The Limited Partners shall be as shown on the books and
records of the Partnership. The books and records of the Partnership contain the
GP-Related Profit Sharing Percentage and GP-Related Commitment of each Partner
(including, without limitation, BSSF Europe GP Delaware) with respect to the
GP-Related Investments of the Partnership as of the date hereof. The books and
records of the Partnership contain the Capital Commitment Profit Sharing
Percentage and Capital Commitment-Related Commitment of each Partner (including,
without limitation, BSSF Europe GP Delaware) with respect to the Capital
Commitment Investments of the Partnership as of the date hereof. The books and
records of the Partnership shall be amended by the General Partner from time to
time to reflect additional

 

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GP-Related Investments, additional Capital Commitment Investments, dispositions
by the Partnership of GP-Related Investments, dispositions by the Partnership of
Capital Commitment Investments, the GP-Related Profit Sharing Percentages of the
Partners (including, without limitation, BSSF Europe GP Delaware) as modified
from time to time, the Capital Commitment Profit Sharing Percentages of the
Partners (including, without limitation, BSSF Europe GP Delaware) as modified
from time to time, the admission of additional Partners, the withdrawal of
Partners and the transfer or assignment of interests in the Partnership pursuant
to the terms of this Agreement. At the time of admission of each additional
Partner, the General Partner shall determine in its sole discretion the
GP-Related Investments and Capital Commitment Investments in which such Partner
shall participate and such Partner’s GP-Related Commitment, Capital
Commitment-Related Commitment, GP-Related Profit Sharing Percentage with respect
to each such GP-Related Investment and Capital Commitment Profit Sharing
Percentage with respect to each such Capital Commitment Investment.

Section 2.2. Formation; Name. The Partnership was formed upon the filing and
recording of a Certificate with the Registrar of Corporations on May 29, 2009
(L.P. No. 14717193) and is hereby continued as a limited partnership pursuant to
the Partnership Act and shall conduct its activities under the name of
Blackstone Real Estate Special Situations Management Associates Europe L.P.

Section 2.3. Term. The term of the Partnership shall continue until December 31,
2059, unless earlier dissolved and terminated in accordance with this Agreement.

Section 2.4. Purpose; Powers. (a) The purpose and character of the business of
the Partnership shall be, directly or indirectly through subsidiaries or
Affiliates,

(i) to serve as a limited partner of Associates or of any Other Fund GP and
perform the obligations of a limited partner specified in such entities’
respective partnership or similar agreements,

(ii) to invest in GP-Related Investments, Capital Commitment Investments and
other Investments and to acquire and invest in Securities or other property
(directly or indirectly),

(iii) to serve as a member of Blackstone Real Estate Special Situations
Associates Europe (Delaware) L.L.C. and perform the obligations of a member
specified in such entity’s respective limited liability company agreement,

(iv) to serve as general partner or limited partner of other partnerships and/or
a member of limited liability companies, and hold interests in partnerships,
companies, corporations and other entities,

(v) to carry on such other businesses for profit, perform such other services
and make such other investments for profit as are deemed desirable by the
General Partner,

(vi) any other lawful purpose, and

(vii) to do all things necessary and incidental thereto.

 

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(b) In furtherance of its purposes, 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 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 Securities 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) to acquire and invest in general 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;

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

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

(v) to hold, receive, mortgage, pledge, 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;

(vi) 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;

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

(viii) to have and maintain one or more offices within or without the Province
of Alberta, Canada, 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;

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

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

 

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

(xii) 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;

(xiii) 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;

(xiv) 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;

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

(xvi) to take such other actions necessary or incidental thereto and to engage
in such other businesses as may be permitted under applicable law.

Section 2.5. Place of Business. The Partnership shall maintain an office and
principal place of business at 345 Park Avenue, New York, New York 10154 U.S.A.,
or such other place or places as may from time to time be designated by the
General Partner.

Section 2.6. Feeder Vehicle. (a) The Interest of the Feeder Vehicle shall be
treated as Interests held by more than one Limited Partner for purposes of
determining the appropriate treatment of the Feeder Vehicle in connection
herewith, in light of the multiple interest holders in the Feeder Vehicle. This
shall include (i) reflecting on the books and records of the Partnership a
separate Interest held by the Feeder Vehicle with respect to each interest
holder therein and (ii) applying the provisions of Article IV as though the
interest holder were a direct Limited Partner in the Partnership.

(b) If any interest holder of the Feeder Vehicle fails to make a Capital
Contribution to the Feeder Vehicle, the Feeder Vehicle may be treated as a
Defaulting Limited Partner in accordance with the provisions hereof, but solely
with respect to such interest holder’s indirect interest in the Partnership.

(c) In the case of any vote of Limited Partners under this Agreement or any law,
the Feeder Vehicle shall vote its Interest in proportion to the votes on such
matter of the interest holders thereof, based on their pro rata interest
therein, that are unaffiliated with the General Partner.

(d) The General Partner may make any adjustments to the Interest of the Feeder
Vehicle to accomplish the overall objectives of this Section 2.6; provided, that
such adjustments shall in no way have a materially adverse effect on the
Interests of any other Partner.

 

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ARTICLE III

MANAGEMENT

Section 3.1. General Partners. BSSF Europe (Cayman) and BSSF Europe GP Delaware
shall be the “General Partners,” subject to Section 3.4. A General Partner may
not be removed without its consent. The management of the business and affairs
of the Partnership shall be vested in the General Partners as provided in
Section 3.4.

Section 3.2. Limitations on Limited Partners. Except as may be expressly
required or permitted by the Partnership Act, Limited Partners as such shall
have no right to, and shall not, take part in the control of the Partnership’s
business or act for or bind the Partnership, and shall have only the rights and
powers of a limited partner as provided in both the Partnership Act and this
Agreement.

Section 3.3. Partner Voting. (a) 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.

(b) Meetings of the Partners may be held only when called by the General
Partner.

Section 3.4. Management. (a) The full management, control and operation of the
Partnership and the formulation and execution of business and investment policy
shall be vested in the General Partners, and the General Partners shall have
full control over the business and affairs of the Partnership; provided that,
except as otherwise required by applicable law, (i) BSSF Europe (Cayman) shall
have exclusive power, authority, management, control and operation with respect
to the voting of securities of portfolio companies of BSSF Europe, (ii) BSSF
Europe GP Delaware shall have exclusive power, authority, management, control
and operation with respect to all matters of any kind except the voting of
securities of portfolio companies of BSSF Europe, and (iii) each reference to
the “General Partner” in this Agreement means BSSF Europe GP Delaware, unless
such reference relates to the voting of securities of portfolio companies of
BSSF Europe, in which case, such reference means BSSF Europe (Cayman). Subject
to the proviso to the immediately preceding sentence, the General Partners
shall, in the General Partners’ discretion, exercise all powers necessary and
convenient for the purposes of the Partnership, including, without limitation,
those enumerated in Section 2.4, on behalf and in the name of the Partnership.
All decisions and determinations (howsoever described herein) to be made by the
General Partners pursuant to this Agreement shall be made in the General
Partners’ discretion, subject only to the express terms and conditions of this
Agreement.

(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.

Section 3.5. Responsibilities of Partners. The General Partner may from time to
time establish such rules and regulations applicable to Partners as the General
Partner deems appropriate.

Section 3.6. 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

 

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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 and in what such Covered Person
reasonably believed to be in, or not opposed to, the best interests of the
Partnership and within the authority granted to such Covered Person by this
Agreement, and, with respect to any criminal act or proceeding, had reasonable
cause to believe that such Covered Person’s conduct was unlawful. 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.

(b) Indemnification. 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 GP-Related Commitments and
Capital Commitment - Related 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 3.6, “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 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 and in what such Covered Person
reasonably believed to be in, or not opposed to, the best interest of the
Partnership and within the authority granted to such Covered Person by this
Agreement, and, with respect to any criminal act or proceeding, had reasonable
cause to believe that such Covered Person’s conduct was unlawful; 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 GP-Related 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, 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

 

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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
GP-Related Commitment and Capital Commitment - Related 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.

Section 3.7. Representations of Limited Partners.

(a) Each Limited 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 Limited
Partner is acquiring each of such Limited Partner’s Interests for such Limited
Partner’s own account for investment and not with a view to resell or distribute
the same or any part hereof, and that no other person has any interest in any
such Interest or in the rights of such Limited Partner hereunder. Each Limited
Partner represents and warrants that such Limited Partner understands that the
Interests have not been registered under the Securities Act of 1933 and
therefore such Interests may not be resold without registration under such Act
or exemption from such registration, and that accordingly such Limited Partner
must bear the economic risk of an investment in the Partnership for an
indefinite period of time. Each Limited Partner represents that such Limited
Partner has such knowledge and experience in financial and business matters that
such Limited Partner is capable of evaluating the merits and risks of an
investment in the Partnership, and that such Limited Partner is able to bear the
economic risk of such investment. Each Limited Partner represents that such
Limited Partner’s overall commitment to the Partnership and other investments
which are not readily marketable is not disproportionate to the Limited
Partner’s net worth and the Limited Partner has no need for liquidity in the
Limited Partner’s investment in Interests. Each Limited Partner represents that
to the full satisfaction of the Limited Partner, the Limited Partner has been
furnished any materials that such Limited Partner has requested relating to the
Partnership, any Investment 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 to each Investment and to obtain any other additional information
relating thereto. Each Limited Partner represents that the Limited Partner has
consulted to the extent deemed appropriate by the Limited Partner with the
Limited Partner’s own advisers 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 Limited Partner.

(b) Each 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 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 3.8. Tax Representation. Each Limited Partner certifies that (A) if the
Limited Partner is a United States person (as defined in the Code) (x) (i) the
Limited 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, Payer’s Request for Taxpayer
Identification Number Certification (“W-9”) or otherwise are correct and
(ii) the Limited Partner will complete and return a W-9, and (y) (i) the Limited
Partner is a United States person (as defined in the Code) and (ii) the

 

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Limited Partner will notify the Partnership within 60 days of a change to
foreign (non-United States) status or (B) if the Limited 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 (“W-8BEN”) or other applicable form, including but not
limited to IRS Form W-8IMY, Certificate of Foreign Intermediary, Foreign
Partnership, or Certain U.S. Branches for United States Tax Withholding
(“W-8IMY”), or otherwise is correct and (ii) the Limited Partner will complete
and return the applicable IRS form, including but not limited to a W-8BEN or
W-8IMY, and (y) (i) the Limited Partner is not a United States person (as
defined in the Code) and (ii) the Limited Partner will notify the Partnership
within 60 days of any change of such status. The Limited Partner agrees to
properly execute and provide to the Partnership in a timely manner any tax
documentation that may be reasonably required by the General Partner.

ARTICLE IV

CAPITAL OF THE PARTNERSHIP

Section 4.1. Capital Contributions by Partners. (a) Each Partner (other than
BSSF Europe (Cayman)) may be required to make GP-Related Capital Contributions
to the Partnership at such times and in such amounts as are required to fund the
GP-Related Required Amounts, as determined by the General Partner from time to
time; provided, that (i) such GP-Related Capital Contributions may be made pro
rata among the Partners (other than BSSF Europe (Cayman)) based upon the
allocation of the Carried Interest in each GP-Related BSSF Europe Investment by
the General Partner and (ii) additional GP-Related Capital Contributions in
excess of GP-Related Required Amounts which are to be used for ongoing business
operations (as distinct from financing legal or other specific liabilities of
the Partnership) (including those specifically set forth in Sections 4.1(d) and
5.8(d)) shall be determined by the General Partner; provided further, that the
General Partner may excuse any Partner from making GP-Related Capital
Contributions to fund GP-Related Required Amounts as provided in the books and
records of the Partnership. Limited Partners (other than Special Limited
Partners or any Affiliates thereof) shall not be required to make additional
GP-Related Capital Contributions to the Partnership except (i) as a condition of
an increase in such Limited Partner’s GP-Related Profit Sharing Percentage, or
(ii) as specifically set forth in this Agreement; provided, however, that the
General Partner and any Partner (other than BSSF Europe (Cayman)) may agree from
time to time that such Partner shall make an additional GP-Related Capital
Contribution to the Partnership; and provided further that each Investor Limited
Partner shall maintain its GP-Related Capital Account at a level equal to the
product of (i) its GP-Related Profit Sharing Percentage from time to time and
(ii) the total capital of the Partnership related to the Partnership’s
GP-Related Associates Partner Interest; provided further, that the foregoing in
no way limits any other provision of this Agreement (including without
limitation, Sections 5.8(d) and (e) and 6.5) or of any written agreement between
a Partner and the Partnership or an Affiliate thereof which requires the making
of any such additional GP-Related Capital Contribution; provided further, that
if required by applicable law, the maximum amount of capital a Partner is
obligated to contribute to the Partnership at any time in respect of such
Partner’s GP-Related Partner Interest shall be disclosed in a Certificate filed
in accordance with the Partnership Act; and provided further, that, any
provision of this Agreement to the contrary notwithstanding, BSSF Europe
(Cayman) shall be required to make a maximum capital contribution of (U.S.)$10.
Notwithstanding the foregoing, the unfunded amount of the commitment of any
Partner (other than BSSF Europe (Cayman)) to make GP-Related Capital
Contributions to the Partnership (such Partner’s “Unfunded Commitment”) may be
determined and redetermined by the General Partner from time to time (including,
without limitation, any redetermination that results in a reduction in such
Partner’s Unfunded Commitment, which reduction may be retroactive); provided
that each Partner (other than BSSF Europe (Cayman)) agrees to make GP-Related
Capital

 

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Contributions in the full amount of such Partner’s Unfunded Commitment at any
time, on condition that the General Partner does not thereafter make a
redetermination that results in a reduction in such Partner’s Unfunded
Commitment and subject to all other terms and conditions set forth herein and/or
in any other agreement relating thereto; and provided further, that, following
an initial determination of the commitment of a Partner (other than BSSF Europe
(Cayman)), such Partner’s Unfunded Commitment shall not be increased without the
consent of such Partner. Any provision of this Agreement to the contrary
notwithstanding, no GP-Related Capital Contribution shall become due and payable
or be required to be made by any Partner, unless and until it shall be called by
the General Partner for the purposes set forth herein or in the Commitment
Agreement of such Partner.

(b) The General Partner may elect on a case by case basis to (i) cause the
Partnership to loan any 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) the amount of any GP-Related Capital
Contribution required to be made by such Partner or (ii) permit any Partner
(including any additional Partner admitted to the Partnership pursuant to
Section 6.1) to make a required GP-Related Capital Contribution to the
Partnership in installments, in each case on terms determined by the General
Partner in accordance with Section 5.2.

(c) Each GP-Related Capital Contribution by a Partner shall be credited to the
appropriate GP-Related Capital Account of such Partner in accordance with
Section 5.2.

(d) (i) The Partners and the Withdrawn Partners have entered into the Trust
Agreement, pursuant to which certain amounts of the distributions relating to
the Carried Interest will be paid to the Trustee(s) for deposit in the Trust
Account (such amounts to be paid to the Trustee(s) for deposit in the Trust
Account constituting a “Holdback”). The General Partner shall determine, as set
forth below, the percentage of each distribution of Carried Interest that shall
be withheld for BSSF Europe GP Delaware and each Partner Category (such withheld
percentage constituting BSSF Europe GP Delaware’s and such Partner Category’s
“Holdback Percentage”). The applicable Holdback Percentages initially shall be
0% for BSSF Europe GP Delaware, 15% for Existing Partners (other than BSSF
Europe GP Delaware), 21% for Retaining Withdrawn Partners (other than BSSF
Europe GP Delaware) and 24% for Deceased Partners (the “Initial Holdback
Percentages”). Any provision of this Agreement to the contrary notwithstanding,
the Holdback Percentage for BSSF Europe GP Delaware shall not be subject to
change pursuant to clause (ii), (iii) or (iv) of this Section 4.1(d).

(ii) The Holdback Percentage may not be reduced for any individual Partner as
compared to the other Partners in his Partner Category (except as provided in
clause (iv) below). The General Partner may only reduce the Holdback Percentages
among the Partner Categories on a proportionate basis. For example, if the
Holdback Percentage for Existing Partners is decreased to 12.5%, the Holdback
Percentage for Retaining Withdrawn Partners and Deceased Partners shall be
reduced to 17.5% and 20%, respectively. Any reduction in the Holdback Percentage
for any Partner shall apply only to distributions relating to Carried Interest
made after the date of such reduction.

(iii) The Holdback Percentage may not be increased for any individual Partner as
compared to the other Partners in his Partner Category (except as provided in
clause (iv) below). The General Partner may not increase the Retaining Withdrawn
Partners’ Holdback Percentage beyond 21% unless the General Partner concurrently
increases the Existing Partners’ Holdback Percentage to 21%. The General Partner
may not increase the Deceased Partners’ Holdback Percentage beyond 24% unless
the General Partner increases the Holdback Percentage for both Existing Partners
and Retaining Withdrawn Partners to 24%. The General Partner may

 

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not increase the Holdback Percentage of any Partner Category beyond 24% unless
such increase applies equally to all Partner Categories. Any increase in the
Holdback Percentage for any Partner shall apply only to distributions relating
to Carried Interest made after the date of such increase. The foregoing shall in
no way prevent the General Partner from proportionately increasing the Holdback
Percentage of any Partner Category (following a reduction of the Holdback
Percentages below the Initial Holdback Percentages), if the resulting Holdback
Percentages are consistent with the above. For example, if the General Partner
reduces the Holdback Percentages for Existing Partners, Retaining Withdrawn
Partners and Deceased Partners to 12.5%, 17.5% and 20%, respectively, the
General Partner shall have the right to subsequently increase the Holdback
Percentages to the Initial Holdback Percentages.

(iv) (A) Notwithstanding anything contained herein to the contrary, the
Partnership may increase or decrease the Holdback Percentage for any Partner in
any Partner Category (in such capacity, the “Subject Partner”) pursuant to a
majority vote of the Special Limited Partners and BSSF Europe GP Delaware (a
“Holdback Vote”); provided, that a Subject Partner’s Holdback Percentage shall
not be (I) increased prior to such time as such Subject Partner (x) is notified
by the Partnership of the decision to increase such Subject Partner’s Holdback
Percentage and (y) has, if requested by such Subject Partner, been given 30 days
to gather and provide information to the Partnership for consideration before a
second Holdback Vote (requested by the Subject Partner) and (II) decreased
unless such decrease occurs subsequent to an increase in a Subject Partner’s
Holdback Percentage pursuant to a Holdback Vote under this clause (iv); provided
further, that such decrease shall not exceed an amount such that such Subject
Partner’s Holdback Percentage is less than the prevailing Holdback Percentage
for such Subject Partner’s Partner Category; provided further, that a Partner
shall not vote to increase a Subject Partner’s Holdback Percentage unless such
voting partner determines, in his good faith judgment, that the facts and
circumstances indicate that it is reasonably likely that such Subject Partner,
or any of his successors or assigns (including his estate or heirs) who at the
time of such vote holds the Partnership interest or otherwise has the right to
receive distributions relating thereto, will not be capable of satisfying any
GP-Related Recontribution Amounts that may become due.

(B) A Holdback Vote shall take place at a Partnership meeting. Each of the
Special Limited Partners and BSSF Europe GP Delaware shall be entitled to cast
one vote with respect to the Holdback Vote regardless of such Partner’s interest
in the Partnership. Such vote may be cast by any such Partner in person or by
proxy.

(C) If the result of the second Holdback Vote is an increase in a Subject
Partner’s Holdback Percentage, such Subject Partner may submit the decision to
an arbitrator, the identity of which is mutually agreed upon by both the Subject
Partner and the Partnership; provided, that if the Partnership and the Subject
Partner cannot agree upon a mutually satisfactory arbitrator within 10 days of
the second Holdback Vote, each of the Partnership and the Subject Partner shall
request its candidate for arbitrator to select a third arbitrator satisfactory
to such candidates; provided further, that if such candidates fail to agree upon
a mutually satisfactory arbitrator within 30 days of such request, the then
sitting President of the American Arbitration Association shall unilaterally
select the arbitrator. Each Subject Partner that submits the decision of the
Partnership pursuant to the second Holdback Vote to arbitration and the
Partnership shall estimate their reasonably projected out-of-pocket expenses
relating thereto and each such party shall, to the satisfaction of the
arbitrator and prior to any determination being made by the arbitrator, pay the
total of such estimated expenses (i.e., both the Subject Partner’s

 

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and the Partnership’s expenses) into an escrow account to be controlled by
Simpson Thacher & Bartlett, as escrow agent (or such other comparable law firm
as the Partnership and Subject Partner shall agree). The arbitrator shall direct
the escrow agent to pay out of such escrow account all expenses associated with
such arbitration (including costs leading thereto) and to return to the
“victorious” party the entire amount of funds such party paid into such escrow
account. If the amount contributed to the escrow account by the losing party is
insufficient to cover the expenses of such arbitration, such “losing” party
shall then provide any additional funds necessary to cover such costs to such
“victorious” party. For purposes hereof, the “victorious” party shall be the
Partnership, if the Holdback Percentage ultimately determined by the arbitrator
is closer to the percentage determined in the second Holdback Vote than it is to
the prevailing Holdback Percentage for the Subject Partner’s Partner Category;
otherwise, the Subject Partner shall be the “victorious” party. The party that
is not the “victorious” party shall be the “losing” party.

(D) In the event of a decrease in a Subject Partner’s Holdback Percentage
(1) pursuant to a Holdback Vote under this clause (iv) or (2) pursuant to a
decision of an arbitrator under paragraph (C) of this clause (iv), the
Partnership shall release and distribute to such Subject Partner any Trust
Amounts (and the Trust Income thereon (except as expressly provided herein with
respect to using Trust Income as Firm Collateral)) which exceed the required
Holdback of such Subject Partner (in accordance with such Subject Partner’s
reduced Holdback Percentage) as though such reduced Holdback Percentage had
applied since the increase of the Subject Partner’s Holdback Percentage pursuant
to a previous Holdback Vote under this clause (iv).

(v) (A) If a Partner’s Holdback Percentage exceeds 15% (such percentage in
excess of 15% constituting the “Excess Holdback Percentage”), such Partner may
satisfy the portion of his Holdback obligation in respect of his Excess Holdback
Percentage (such portion constituting such Partner’s “Excess Holdback”), and
such Partner (or a Withdrawn Partner with respect to amounts contributed to the
Trust Account while he was a Partner), to the extent his Excess Holdback
obligation has previously been satisfied in cash, may obtain the release of the
Trust Amounts (but not the Trust Income thereon which shall remain in the Trust
Account and allocated to such Partner or Withdrawn Partner) satisfying such
Partner’s or Withdrawn Partner’s Excess Holdback obligation, by pledging or
otherwise making available to the Partnership, on a first priority basis (except
as provided below), all or any portion of his Firm Collateral in satisfaction of
his Excess Holdback obligation. Any Partner seeking to satisfy all or any
portion of the Excess Holdback utilizing Firm Collateral shall sign such
documents and otherwise take such other action as is necessary or appropriate
(in the good faith judgment of the General Partner) to perfect a first priority
security interest in, and otherwise assure the ability of the Partnership to
realize on (if required), such Firm Collateral; provided, that in the case of
entities listed in the books and records of the Partnership, in which
Partners/members are permitted to pledge their interests therein to finance all
or a portion of their capital contributions thereof (“Pledgable Blackstone
Interests”), to the extent a first priority security interest is unavailable
because of an existing lien on such Firm Collateral, the Partner or Withdrawn
Partner seeking to utilize such Firm Collateral shall grant the Partnership a
second priority security interest therein in the manner provided above; provided
further, that (x) to the extent that neither a first priority nor a second
priority security interest in Pledgable Blackstone Interests is available, or
(y) if the General Partner otherwise determines in its good faith judgment that
a security interest in Firm Collateral (and the corresponding documents and
actions) are not necessary or appropriate, the

 

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Partner or Withdrawn Partner shall (in the case of either clause (x) or
(y) above) irrevocably instruct in writing the relevant partnership, limited
liability company or other entity listed on Exhibit A to remit any and all net
proceeds resulting from a Firm Collateral Realization on such Firm Collateral to
the Trustee(s) as more fully provided in clause (B) below. The Partnership
shall, at the request of any Partner or Withdrawn Partner, assist such Partner
or Withdrawn Partner in taking such action as is necessary to enable such
Partner or Withdrawn Partner to use Firm Collateral as provided hereunder.

(B) If upon a sale or other realization of all or any portion of any Firm
Collateral (a “Firm Collateral Realization”), the remaining Firm Collateral is
insufficient to cover any Partner’s or Withdrawn Partner’s Excess Holdback
requirement, then up to 100% of the net proceeds otherwise distributable to such
Partner or Withdrawn Partner from such Firm Collateral Realization (including
distributions subject to the repayment of financing sources as in the case of
Pledgable Blackstone Interests) shall be paid into the Trust Account to fully
satisfy such Excess Holdback requirement (allocated to such Partner or Withdrawn
Partner) and shall be deemed to be Trust Amounts for purposes hereunder. Any net
proceeds from such Firm Collateral Realization in excess of the amount necessary
to satisfy such Excess Holdback requirement shall be distributed to such Partner
or Withdrawn Partner.

(C) Upon any valuation or revaluation of Firm Collateral that results in a
decreased valuation of such Firm Collateral so that such Firm Collateral is
insufficient to cover any Partner’s or Withdrawn Partner’s Excess Holdback
requirement (including upon a Firm Collateral Realization, if net proceeds
therefrom and the remaining Firm Collateral are insufficient to cover any
Partner’s or Withdrawn Partner’s Excess Holdback requirement), the Partnership
shall provide notice of the foregoing to such Partner or Withdrawn Partner and
such Partner or Withdrawn Partner shall, within 30 days of receiving such
notice, contribute cash (or additional Firm Collateral) to the Trust Account in
an amount necessary to satisfy his Excess Holdback requirement. If any such
Partner or Withdrawn Partner defaults upon his obligations under this clause
(C), then Section 5.8(d)(ii) shall apply thereto; provided, that the first
sentence of Section 5.8(d)(ii) shall be deemed inapplicable to a default under
this clause (C); provided further, that for purposes of applying
Section 5.8(d)(ii) to a default under this clause (C): (1) the term “GP-Related
Defaulting Party” where such term appears in such Section 5.8(d)(ii) shall be
construed as “defaulting party” for purposes hereof and (2) the terms “Net
GP-Related Recontribution Amount” and “GP-Related Recontribution Amount” where
such terms appear in such Section 5.8(d)(ii) shall be construed as the amount
due pursuant to this clause (C).

(vi) Any Partner or Withdrawn Partner may (i) obtain the release of any Trust
Amounts (but not the Trust Income thereon which shall remain in the Trust
Account and allocated to such Partner or Withdrawn Partner) or Firm Collateral,
in each case, held in the Trust Account for the benefit of such Partner or
Withdrawn Partner or (ii) require the Partnership to distribute all or any
portion of amounts otherwise required to be placed in the Trust Account (whether
cash or Firm Collateral), by obtaining a letter of credit for the benefit of the
Trustee(s) (an “L/C”) in such amounts. Any Partner or Withdrawn Partner choosing
to furnish an L/C to the Trustee(s) (in such capacity, an “L/C Partner”) shall
deliver to the Trustee(s) an unconditional and irrevocable L/C from a commercial
bank whose (A) short-term deposits are rated at least A-1 by S&P and P-1 by
Moody’s (if the L/C is for a term of 1 year or less), or (B) long-term deposits
are rated at least A+ by S&P or A1 by Moody’s (if the L/C is for a term of 1
year or more) (each

 

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a “Required Rating”). If the relevant rating of the commercial bank issuing such
L/C drops below the relevant Required Rating, the L/C Partner shall supply to
the Trustee(s), within 30 days of such occurrence, a new L/C from a commercial
bank whose relevant rating is at least equal to the relevant Required Rating, in
lieu of the insufficient L/C. In addition, if the L/C has a term expiring on a
date earlier than the latest possible termination date of BSSF Europe, the
Trustee(s) shall be permitted to drawdown on such L/C if the L/C Partner fails
to provide a new L/C from a commercial bank whose relevant rating is at least
equal to the relevant Required Rating, at least 30 days prior to the stated
expiration date of such existing L/C. The Trustee(s) shall notify an L/C Partner
10 days prior to drawing on any L/C. The Trustee(s) may (as directed by the
Partnership in the case of clause (1) below) draw down on an L/C only if
(1) such a drawdown is necessary to satisfy an L/C Partner’s obligation relating
to the Partnership’s obligations under the Clawback Provisions or (2) an L/C
Partner has not provided a new L/C from a commercial bank whose relevant rating
is at least equal to the relevant Required Rating (or the requisite amount of
cash and/or Firm Collateral (to the extent permitted hereunder)), at least 30
days prior to the stated expiration of an existing L/C in accordance with this
clause (vi). The Trustee(s), as directed by the Partnership, shall return to any
L/C Partner his L/C upon (1) termination of the Trust Account and satisfaction
of the Partnership’s obligations, if any, in respect of the Clawback Provisions,
(2) an L/C Partner satisfying his entire Holdback obligation in cash and Firm
Collateral (to the extent permitted hereunder), or (3) the release, by the
Trustee(s), as directed by the Partnership, of all amounts in the Trust Account
to Partners or Withdrawn Partners. If an L/C Partner satisfies a portion of his
Holdback obligation in cash and/or Firm Collateral (to the extent permitted
hereunder) or if the Trustee(s), as directed by the Partnership, release a
portion of the amounts in the Trust Account to the Partners or Withdrawn
Partners in the Partner Category of such L/C Partner, an L/C Partner’s L/C may
be reduced by an amount corresponding to such portion satisfied in cash and/or
Firm Collateral (to the extent permitted hereunder) or such portion released by
the Trustee(s), as directed by the Partnership; provided, that in no way shall
the general release of any Trust Income cause an L/C Partner to be permitted to
reduce the amount of an L/C by any amount.

(vii) (A) Any in-kind distributions by the Partnership relating to Carried
Interest shall be made in accordance herewith as though such distributions
consisted of cash. The Partnership may direct the Trustee(s) to dispose of any
in-kind distributions held in the Trust Account at any time. The net proceeds
therefrom shall be treated as though initially contributed to the Trust Account.

(B) In lieu of the foregoing, any Existing Partner may pledge with respect to
any in-kind distribution the Special Firm Collateral referred to in the
applicable books and records of the Partnership; provided, that the initial
contribution of such Special Firm Collateral shall initially equal 130% of the
required Holdback Amount for a period of 90 days, and thereafter shall equal at
least 115% of the required Holdback Amount. Paragraphs 4.1(d)(viii)(C) and
(D) shall apply to such Special Firm Collateral. To the extent such Special Firm
Collateral exceeds the applicable minimum percentage of the required Holdback
Amount specified in the first sentence of this clause (vii)(B), the related
Partner may obtain a release of such excess amount from the Trust Account.

(viii) (A) Any Partner or Withdrawn Partner may satisfy all or any portion of
his Holdback (excluding any Excess Holdback), and such Partner or a Withdrawn
Partner may, to the extent his Holdback (excluding any Excess Holdback) has been
previously satisfied in cash or by the use of an L/C as provided herein, obtain
a release of Trust Amounts (but not the Trust Income thereon which shall remain
in the Trust Account and allocated to such Partner or

 

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Withdrawn Partner) that satisfy such Partner’s or Withdrawn Partner’s Holdback
(excluding any Excess Holdback) by pledging to the Trustee(s) on a first
priority basis all of his Special Firm Collateral in a particular Qualifying
Fund, which at all times must equal or exceed the amount of the Holdback
distributed to the Partner or Withdrawn Partner (as more fully set forth below).
Any Partner seeking to satisfy such Partner’s Holdback utilizing Special Firm
Collateral shall sign such documents and otherwise take such other action as is
necessary or appropriate (in the good faith judgment of the General Partner) to
perfect a first priority security interest in, and otherwise assure the ability
of the Trustee(s) )to realize on (if required), such Special Firm Collateral.

(B) If upon a distribution, withdrawal, sale, liquidation or other realization
of all or any portion of any Special Firm Collateral (a “Special Firm Collateral
Realization”), the remaining Special Firm Collateral (which shall not include
the amount of Firm Collateral that consists of a Qualifying Fund and is being
used in connection with an Excess Holdback) is insufficient to cover any
Partner’s or Withdrawn Partner’s Holdback (when taken together with other means
of satisfying the Holdback as provided herein (i.e., cash contributed to the
Trust Account or an L/C in the Trust Account)), then up to 100% of the net
proceeds otherwise distributable to such Partner or Withdrawn Partner from such
Special Firm Collateral Realization (which shall not include the amount of Firm
Collateral that consists of a Qualifying Fund and is being used in connection
with an Excess Holdback) shall be paid into the Trust (and allocated to such
Partner or Withdrawn Partner) to fully satisfy such Holdback and shall be deemed
thereafter to be Trust Amounts for purposes hereunder. Any net proceeds from
such Special Firm Collateral Realization in excess of the amount necessary to
satisfy such Holdback (excluding any Excess Holdback) shall be distributed to
such Partner or Withdrawn Partner. To the extent a Qualifying Fund distributes
Securities to a Partner or Withdrawn Partner in connection with a Special Firm
Collateral Realization, such Partner or Withdrawn Partner shall be required to
promptly fund such Partner’s or Withdrawn Partner’s deficiency with respect to
his Holdback in cash or an L/C.

(C) Upon any valuation or revaluation of the Special Firm Collateral and/or any
adjustment in the Applicable Collateral Percentage applicable to a Qualifying
Fund (as provided in the books and records of the Partnership), if such
Partner’s or Withdrawn Partner’s Special Firm Collateral valued at less than
such Partner’s Holdback (excluding any Excess Holdback) as provided in the books
and records of the Partnership, taking into account other permitted means of
satisfying the Holdback hereunder, the Partnership shall provide notice of the
foregoing to such Partner or Withdrawn Partner and, within 10 business days of
receiving such notice, such Partner or Withdrawn Partner shall contribute cash
or additional Special Firm Collateral to the Trust Account in an amount
necessary to make up such deficiency. If any such Partner or Withdrawn Partner
defaults upon his obligations under this clause (C), then Section 5.8(d)(ii)
shall apply thereto; provided, that clause (A) of the first sentence of
Section 5.8(d)(ii) shall be deemed inapplicable to such default; provided
further, that for purposes of applying Section 5.8(d)(ii) to a default under
this clause (C): (I) the term “GP-Related Defaulting Party” where such term
appears in such Section 5.8(d)(ii) shall be construed as “defaulting party” for
purposes hereof and (II) the terms “GP-Related Net Recontribution Amount” and
“GP-Related Recontribution Amount” where such terms appear in such
Section 5.8(d)(ii) shall be construed as the amount due pursuant to this clause
(C).

 

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(D) Upon a Partner becoming a Withdrawn Partner, at any time thereafter the
General Partner may revoke the ability of such Withdrawn Partner to use Special
Firm Collateral as set forth in this Section 4.1(d)(viii), notwithstanding
anything else in this Section 4.1(d)(viii). In that case the provisions of
clause (C) above shall apply to the Withdrawn Partner’s obligation to satisfy
the Holdback (except that 30 days’ notice of such revocation shall be given),
given that the Special Firm Collateral is no longer available to satisfy any
portion of the Holdback (excluding any Excess Holdback).

(E) Nothing in this Section 4.1(d)(viii) shall prevent any Partner or Withdrawn
Partner from using any amount of such Partner’s interest in a Qualifying Fund as
Firm Collateral; provided that at all times Section 4.1(d)(v) and this
Section 4.1(d)(viii) are each satisfied.

Section 4.2. Interest. Interest on the balances of the Partners’ capital
(excluding capital invested in GP-Related Investments and, if deemed appropriate
by the General Partner, capital invested in any other investment of the
Partnership) shall be credited to the Partners’ GP-Related Capital Accounts at
the end of each accounting period pursuant to Section 5.2, or at any other time
as determined by the General Partner, at rates determined by the General Partner
from time to time, and shall be charged as an expense of the Partnership.

Section 4.3. Withdrawals of Capital. The Partners may not withdraw capital
related to such Partner’s GP-Related Partner Interest from the Partnership
except (i) for distributions of cash or other property pursuant to Section 5.8,
(ii) as otherwise expressly provided in this Agreement, or (iii) as determined
by the General Partner.

ARTICLE V

PARTICIPATION IN PROFITS AND LOSSES

Section 5.1. General Accounting Matters. (a) GP-Related 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) “GP-Related Net Income (Loss)” from any activity of the Partnership related
to the Partnership’s GP-Related Associates Interest for any accounting period
(other than GP-Related Net Income (Loss) from GP-Related Investments described
below) means (i) the gross income realized by the Partnership from such activity
during such accounting period less (ii) all expenses of the Partnership, and all
other items that are deductible from gross income, for such accounting period
that are allocable to such activity (determined as provided below).

“GP-Related Net Income (Loss)” from any GP-Related Investment for any accounting
period in which such GP-Related Investment has not been sold or otherwise
disposed of means (i) the gross amount of dividends, interest or other income
received by the Partnership from such GP-Related Investment during such
accounting period less (ii) all expenses of the Partnership for such accounting
period that are allocable to such GP-Related Investment (determined as provided
below).

“GP-Related Net Income (Loss)” from any GP-Related Investment for the accounting
period in which such GP-Related Investment is sold or otherwise disposed of
means (i) the sum of the gross proceeds from the sale or other disposition of
such GP-Related Investment and the gross amount of dividends,

 

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interest or other income received by the Partnership from such GP-Related
Investment during such accounting period less (ii) the sum of the cost or other
basis to the Partnership of such GP-Related Investment and all expenses of the
Partnership for such accounting period that are allocable to such GP-Related
Investment.

GP-Related Net Income (Loss) 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 GP-Related Net Income (Loss) shall be added to such taxable income or
loss; (ii) if any asset has a value on 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 on 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 GP-Related Net
Income (Loss) pursuant to this definition shall be treated as deductible items;
(v) any income from a GP-Related Investment that is payable to Partnership
employees in respect of “phantom interests” in such GP-Related Investment
awarded by the General Partner to employees shall be included as an expense in
the calculation of GP-Related Net Income (Loss) from such GP-Related Investment,
and (vi) items of income and expense (including interest income and overhead and
other indirect expenses) of the Partnership and Affiliates of the Partnership
shall be allocated among the Partnership and such Affiliates, among various
Partnership activities and GP-Related Investments and between accounting
periods, in each case as determined by the General Partner. The General Partner
may adjust GP-Related Net Income (Loss) as it deems appropriate from time to
time, 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, and any such adjustment, if made, shall be made in accordance
with GAAP; (provided, that the General Partner shall not be required to make any
such adjustment).

(c) 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
Settlement Date of a Withdrawn Partner, if any such date is not the first day of
a Fiscal Year. 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 it
deems appropriate to the Partners’ GP-Related Profit Sharing Percentages for the
accounting period in which such event occurs (prior to any allocations of
GP-Related Unallocated Percentages or adjustments to GP-Related Profit Sharing
Percentages pursuant to Section 5.3) to reflect the Partners’ average GP-Related
Profit Sharing Percentages during such accounting period; provided, that the
GP-Related Profit Sharing Percentages of Partners in GP-Related Net Income
(Loss) from GP-Related Investments acquired during such accounting period will
be based on GP-Related Profit Sharing Percentages in effect when each such
GP-Related Investment was acquired.

(d) In establishing GP-Related Profit Sharing Percentages and allocating
GP-Related Unallocated Percentages pursuant to Section 5.3, the General Partner
may consider such factors as it deems appropriate.

(e) 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

 

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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 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
on the books of the Partnership, to the extent and at such times as may be
appropriate, one or more capital accounts as the General Partner may deem to be
appropriate for purposes of accounting for such Partner’s interests in the
capital in respect of such Partner’s GP-Related Partner Interest and GP-Related
Net Income (Loss) of the Partnership (each a “GP-Related Capital Account”).

(b) As of the end of each accounting period or, in the case of a contribution to
the Partnership by one or more of the Partners in respect of such Partner or
Partners’ GP-Related Partner Interests or a distribution by the Partnership to
one or more of the Partners in respect of such Partner or Partners’ GP-Related
Partner Interests, at the time of such contribution or distribution, (i) the
appropriate GP-Related Capital 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 in respect of such
Partner’s GP-Related Partner Interest during such accounting period, (B) the
GP-Related Net Income allocated to such Partner for such accounting period and
(C) the interest credited on the balance of such Partner’s capital in respect of
such Partner’s GP-Related Partner Interest for such accounting period pursuant
to Section 4.2; and (ii) the appropriate GP-Related Capital 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 in respect of such Partner’s GP-Related Partner
Interest during such accounting period and (y) the GP-Related Net Loss allocated
to such Partner for such accounting period.

Section 5.3. GP-Related Profit Sharing Percentages. (a) Prior to the beginning
of each annual accounting period, the General Partner shall (i) establish the
profit sharing percentage (the “GP-Related Profit Sharing Percentage”) of each
Partner in each category of GP-Related 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(d), and (ii) disclose such GP-Related Profit Sharing Percentages as
required by the Partnership Act; provided, however, that (i) the General Partner
may elect to establish GP-Related Profit Sharing Percentages in GP-Related Net
Income (Loss) from any GP-Related Investment acquired by the Partnership during
such accounting period at the time such GP-Related Investment is acquired in
accordance with paragraph (d) below and (ii) GP-Related Net Income (Loss) for
such accounting period from any GP-Related Investment shall be allocated in
accordance with the GP-Related Profit Sharing Percentages in such GP-Related
Investment established in accordance with paragraph (d) below. The General
Partner may establish different GP-Related Profit Sharing Percentages for any
Partner in different categories of GP-Related Net Income (Loss). In the case of
the Withdrawal of a Partner, such former Partner’s GP-Related Profit Sharing
Percentages shall be allocated by the General Partner to one or more of the
remaining Partners as the General Partner shall determine. In the case of the
admission of any Partner to the Partnership as an additional Partner, the
GP-Related Profit Sharing Percentages of the other Partners shall be reduced by
an amount equal to the GP-Related Profit Sharing Percentage allocated to such
new Partner pursuant to Section 6.1(b); such reduction of each other Partner’s
GP-Related Profit Sharing Percentage shall be pro rata based upon such Partner’s
GP-Related Profit Sharing Percentage as in effect immediately prior to the
admission of the new Partner. Notwithstanding the foregoing, the General Partner
may also adjust the GP-Related Profit Sharing Percentage of any Partner for any
annual accounting period at the end of such annual accounting period.

 

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(b) The General Partner may elect to allocate to the Partners less than 100% of
the GP-Related Profit Sharing Percentages of any category for any annual
accounting period at the time specified in Section 5.3(a) for the annual fixing
of GP-Related Profit Sharing Percentages (any remainder of such GP-Related
Profit Sharing Percentages being called a “GP-Related Unallocated Percentage”);
provided, that any GP-Related Unallocated Percentage in any category of
GP-Related Net Income (Loss) for any annual accounting period that is not
allocated by the General Partner within 90 days after the end of such accounting
period shall be deemed to be allocated among all the Partners (including BSSF
Europe GP Delaware) in the manner determined by the General Partner in its sole
discretion.

(c) Unless otherwise determined by the General Partner in a particular case,
(i) GP-Related Profit Sharing Percentages in GP-Related Net Income (Loss) from
any GP-Related Investment shall be allocated in proportion to the Partners’
respective GP-Related Capital Contributions in respect of such GP-Related
Investment and (ii) GP-Related Profit Sharing Percentages in GP-Related Net
Income (Loss) from each GP-Related Investment shall be fixed at the time such
GP-Related Investment is acquired and shall not thereafter change, subject to
any repurchase rights or other requirements established by the General Partner
pursuant to Section 5.7. BSSF Europe (Cayman) shall have no GP-Related Profit
Sharing Percentage in GP-Related Net Income (Loss) from any GP-Related
Investment, but shall receive its pro rata share, based on its capital
contribution, of earnings on short-term and temporary investments of the
Partnership.

Section 5.4. Allocations of GP-Related Net Income (Loss). (a) Except as provided
in Sections 5.4(d), GP-Related Net Income for each GP-Related BSSF Europe
Investment shall be allocated to the GP-Related Capital Accounts related to such
GP-Related BSSF Europe Investment of all the Partners participating in such
GP-Related BSSF Europe Investment: first, in proportion to and to the extent of
the amount of Non-Carried Interest (other than amounts representing a return of
GP-Related Capital Contributions) or Carried Interest distributed to the
Partners, second, to Partners that received Non-Carried Interest (other than
amounts representing a return of GP-Related Capital Contributions) or Carried
Interest in years prior to the years such GP-Related Net Income is being
allocated to the extent such Non-Carried Interest (other than amounts
representing a return of GP-Related Capital Contributions) or Carried Interest
exceeded GP-Related Net Income allocated to such Partners in such earlier years;
and third, to the Partners in the same manner that such Non-Carried Interest
(other than amounts representing a return of GP-Related Capital Contributions)
or Carried Interest would have been distributed if cash were available to
distribute with respect thereto.

(b) GP-Related Net Loss of the Partnership shall be allocated as follows:
(i) GP-Related Net Loss relating to realized losses suffered by BSSF Europe and
allocated (indirectly) to the Partnership with respect to its pro rata share
thereof (based on GP-Related Capital Contributions made (indirectly) to BSSF
Europe) shall be allocated to the Partners in accordance with each Partner’s
Non-Carried Interest Sharing Percentage with respect to the GP-Related
Investment giving rise to such loss suffered by BSSF Europe and (ii) GP-Related
Net Loss relating to realized losses suffered by BSSF Europe and allocated
(indirectly) to the Partnership with respect to the Carried Interest shall be
allocated in accordance with a Partner’s (including Withdrawn Partner’s) Carried
Interest Give Back Percentage (as of the date of such loss) (subject to
adjustment pursuant to Section 5.8(e));

(c) Notwithstanding Section 5.4(a) above, GP-Related Net Income relating to
Carried Interest allocated after the allocation of a GP-Related Net Loss
pursuant to clause (ii) of Section 5.4(b) shall be allocated in accordance with
such Carried Interest Give Back Percentages until such time as the Partners have
been allocated GP-Related Net Income relating to Carried Interest equal to the
aggregate amount of GP-Related Net Loss previously allocated in accordance with
clause (ii) of Section 5.4(b). Withdrawn Partners shall remain Partners for
purposes of allocating such GP-Related Net Loss with respect to Carried
Interest.

 

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(d) To the extent the Partnership has any GP-Related Net Income (Loss) for any
accounting period unrelated to BSSF Europe, such GP-Related Net Income (Loss)
will be allocated in accordance with GP-Related Profit Sharing Percentages
prevailing at the beginning of such accounting period.

(e) The General Partner may authorize from time to time advances to Partners
(including any additional Partner admitted to the Partnership pursuant to
Section 6.1 but excluding any Partners that are also executive officers of
Blackstone) against their allocable shares of GP-Related Net Income (Loss).

Section 5.5. Liability of General Partners. General Partners shall have
unlimited liability for the satisfaction and discharge of all losses,
liabilities and expenses of the Partnership.

Section 5.6. Liability of Limited Partners. Each Limited Partner (including each
Special Limited Partner) and former Limited Partner shall be liable for the
satisfaction and discharge of all losses, liabilities and expenses of the
Partnership allocable to him pursuant to Section 5.4, but only to the extent of
his aggregate capital contributions to the Partnership pursuant to this
Agreement. Except as otherwise provided in the following sentence, in no event
shall any Limited Partner (including any Special Limited Partner) or former
Limited Partner be obligated to make any additional capital contributions to the
Partnership in excess of his aggregate GP-Related Capital Contribution and
Capital Commitment – Related Capital Contribution to the Partnership pursuant to
Sections 4.1 and 7.1, or have any liability in excess of such aggregate
GP-Related Capital Contribution and Capital Commitment—Related Capital
Contribution for the satisfaction and discharge of the losses, liabilities and
expenses of the Partnership. In no way does any of the foregoing limit any
Partner’s obligations under Section 4.1(d) or 5.8(d) or otherwise to make
GP-Related Capital Contributions as provided hereunder. Notwithstanding anything
contained herein, each Partner agrees that the exercise of any right or power
provided in this Agreement shall not make any Limited Partner liable as a
general partner.

Section 5.7. Repurchase Rights, etc. The General Partner may from time to time
establish such repurchase rights and/or requirements with respect to the
Partners’ interests in partnership assets (including GP-Related BSSF Europe
Investments) as the General Partner may determine. The General Partner shall,
prior to the dissolution of the Partnership, 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 rights or other requirements from time to time and (d) make such
exceptions thereto as it may determine on a case by case basis.

Section 5.8. Distributions. (a) (i) The Partnership shall make distributions of
available cash (subject to reserves and adjustments established by the General
Partner as provided in Section 5.1) or other property to Partners in respect of
such Partners’ GP-Related Partner Interests at such times and in such amounts as
are determined by the General Partner. The General Partner shall determine the
availability for distribution of, and shall distribute, cash or other property
separately for each category of GP-Related Net Income (Loss) established
pursuant to Section 5.1(a). Distributions of cash or other property with respect
to Non-Carried Interest shall be made among the Partners in accordance with
their respective Non-Carried Interest Sharing Percentages, and, subject to
Sections 4.1(d) and 5.8(e), distributions of cash or other property with respect
to Carried Interest shall be made among Partners in accordance with their
respective Carried Interest Sharing Percentages.

 

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(ii) At any time that a sale, exchange, transfer or other disposition by BSSF
Europe of a portion of a GP-Related Investment is being considered by the
Partnership (a “GP-Related Disposable Investment”), at the election of the
General Partner each Partner’s GP-Related Partner Interest with respect to such
GP-Related Investment shall be vertically divided into two separate GP-Related
Partner Interests, a GP-Related Partner Interest attributable to the GP-Related
Disposable Investment (a Partner’s “GP-Related Class B Interest”), and a
GP-Related Partner Interest attributable to such GP-Related Investment excluding
the GP-Related Disposable Investment (a Partner’s “GP-Related Class A
Interest”). Distributions (including those resulting from a sale, transfer,
exchange or other disposition by BSSF Europe) relating to a GP-Related
Disposable Investment (with respect to both Carried Interest and Non-Carried
Interest) shall be made only to holders of GP-Related Class B Interests with
respect to such GP-Related Investment in accordance with their GP-Related Profit
Sharing Percentages relating to such GP-Related Class B Interests, and
distributions (including those resulting from the sale, transfer, exchange or
the disposition by BSSF Europe) relating to a GP-Related Investment excluding
such GP-Related Disposable Investment (with respect to both Carried Interest and
Non-Carried Interest) shall be made only to holders of GP-Related Class A
Interests with respect to such GP-Related Investment in accordance with their
respective GP-Related Profit Sharing Percentages relating to such GP-Related
Class A Interests. Except as provided above, distributions of cash or other
property with respect to each category of GP-Related Net Income (Loss) shall be
allocated among the Partners in the same proportions as the allocations of
GP-Related Net Income (Loss) of each such category.

(b) Subject to the Partnership’s having sufficient available cash in the
reasonable judgment of the General Partner, the Partnership shall 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 U.S. Federal, New York State and New York City
income tax rates, (ii) taking into account the deductibility of state and local
income and other taxes 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. 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 is prohibited by or in violation of the Partnership Act.

(c) The General Partner may provide that a Partner’s or employee of the
Partnership’s right to distributions and investments of the Partnership in
respect of such Partner’s GP-Related Partner Interest 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
in respect of such Partner’s GP-Related Partner Interest that are 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
in respect of a Partner’s GP-Related Partner Interest to the applicable
recipient thereof irrespective if whether the applicable Repurchase Period has
lapsed. If a Partner (other than the General

 

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Partner) Withdraws from the Partnership for any reason other than his death,
Total Disability or Incompetence, the undistributed share of any investment in
respect of such Partner’s GP-Related Partner 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 with interests in such investment in
respect of such Partners’ GP-Related Partner Interests in proportion to their
respective percentage interests in such investment in respect of such Partners’
GP-Related Partner Interests, or if no other Partner has a percentage interest
in such specific investment, to BSSF Europe GP Delaware, as General Partner;
provided, however, that the General Partner may allocate the Withdrawn Partner’s
share of unrealized investment income from a forfeited investment in respect of
such Withdrawn Partner’s GP-Related Partner Interest 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 interests in
such investment in respect of such Partners’ GP-Related Partner Interests,
except that, in any event, each Investor Limited Partner shall be allocated a
share of such unrealized investment income equal to its respective GP-Related
Profit Sharing Percentage of such unrealized investment income.

(d) (i) (A) If Associates is obligated under the Clawback Provisions or Giveback
Provisions to contribute to BSSF Europe a Clawback Amount or a Giveback Amount
(other than a Capital Commitment Giveback Amount) and the Partnership is
obligated to contribute any such amount to Associates in respect of the
Partnership’s GP-Related Associates Partner Interest (the amount of such
obligation of the Partnership with respect to such a Giveback Amount being
herein called a “GP-Related Giveback Amount”), the Partnership shall call for
such amounts as are necessary to satisfy such obligations of the Partnership as
determined by the General Partner, in which case each Partner and Withdrawn
Partner shall contribute to the Partnership, in cash, when and as called by the
Partnership, such an amount of prior distributions by the Partnership (and the
Other Fund GPs) with respect to Carried Interest (and/or Non-Carried Interest in
the case of a GP-Related Giveback Amount) (the “GP-Related Recontribution
Amount”) which equals (I) the product of (a) a Partner’s or Withdrawn Partner’s
Carried Interest Give Back Percentage and (b) the aggregate Clawback Amount
payable by the Partnership in the case of Clawback Amounts and (II)with respect
to a GP-Related Giveback Amount, such Partner’s pro rata share of prior
distributions of Carried Interest and/or Non-Carried Interest in connection with
(a) the GP-Related BSSF Europe Investment giving rise to the GP-Related Giveback
Amount, (b) if the amounts contributed pursuant to clause (II)(a) above are
insufficient to satisfy such GP-Related Giveback Amount, GP-Related BSSF Europe
Investments other than the one giving rise to such obligation, but only those
amounts received by the Partners with an interest in the GP-Related BSSF Europe
Investment referred to in clause (II)(a) above, and (c) if the GP-Related
Giveback Amount pursuant to an applicable BSSF Europe Agreement is unrelated to
a specific GP-Related BSSF Europe Investment, all GP-Related BSSF Europe
Investments. Each Partner and Withdrawn Partner shall promptly contribute to the
Partnership, along with satisfying his comparable obligations to the Other Fund
GPs, if any, upon such call, such Partner’s or Withdrawn Partner’s GP-Related
Recontribution Amount, less the amount paid out of the Trust Account on behalf
of such Partner or Withdrawn Partner by the Trustee(s) pursuant to written
instructions from the Partnership, or if applicable, any of the Other Fund GPs
with respect to Carried Interest (and/or Non-Carried Interest in the case of
GP-Related Giveback Amounts) (the “Net GP-Related Recontribution Amount”),
irrespective of the fact that the amounts in the Trust Account may be sufficient
on an aggregate basis to satisfy the Partnership’s and Other Fund GPs’
obligations with respect to the Clawback Provisions and/or Giveback Provisions;
provided, that to the extent a Partner’s or Withdrawn Partner’s share of the
amount paid with respect to the Clawback Amount exceeds his GP-Related
Recontribution Amount, such excess shall be repaid to such Partner or Withdrawn
Partner as promptly as reasonably practicable, subject to clause (ii) below;
provided further, that such written instructions from

 

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the Partnership shall specify each Partner’s and Withdrawn Partner’s GP-Related
Recontribution Amount. Prior to such time, the Partnership may, in its
discretion (but shall be under no obligation to), provide notice that in the
Partnership’s judgment, the potential obligations in respect of the Clawback
Provisions or Giveback Provisions will probably materialize (and an estimate of
the aggregate amount of such obligations); provided further, that any amount
from a Partner’s Trust Account used to pay any GP-Related Giveback Amount (or
such lesser amount as may be required by the General Partner) shall be
contributed by such Partner to such Partner’s Trust Account no later than 30
days after the Net GP-Related Recontribution Amount is paid with respect to such
GP-Related Giveback Amount. Solely to the extent required by the BSSF Europe
Agreements, each indirect partner of the Partnership shall have the same
obligations as a Partner under this Section 5.8(d)(i)(A) and under
Section 5.8(d)(ii)(A) solely with respect to such indirect partner’s pro rata
share of any Clawback Amount (for purposes of this sentence, as defined in
Section 9.2.7(b) of the BSSF Europe Agreements) and solely to the extent that
Associates has insufficient funds to meet Associates’ obligations under
paragraph 9.2.7(a) of the BSSF Europe Agreement and/or the comparable provisions
under any BSSF Europe Agreement.

(B) To the extent any Partner or Withdrawn Partner has satisfied any Excess
Holdback obligation with Firm Collateral, such Partner or Withdrawn Partner
shall, within 10 days of the Partnership’s call for GP-Related Recontribution
Amounts, make a cash payment into the Trust Account in an amount equal to the
amount of the Excess Holdback obligation satisfied with such Firm Collateral, or
such lesser amount such that the amount in the Trust Account allocable to such
Partner or Withdrawn Partner equals the sum of (I) such Partner’s or Withdrawn
Partner’s GP-Related Recontribution Amount and (II) any similar amounts payable
to any Other Fund GPs. Immediately upon receipt of such cash, the Trustee(s)
shall take such steps as are necessary to release such Firm Collateral of such
Partner or Withdrawn Partner equal to the amount of such cash payment. If the
amount of such cash payment is less than the amount of Firm Collateral of such
Partner or Withdrawn Partner, the balance of such Firm Collateral if any, shall
be retained to secure the payment of GP-Related Deficiency Contributions, if
any, and shall be fully released upon the satisfaction of the Partnership’s and
the Other Fund GPs’ obligation to pay the Clawback Amount. The failure of any
Partner or Withdrawn Partner to make a cash payment in accordance with this
clause (B) (to the extent applicable) shall constitute a default under
Section 5.8(d)(ii) as if such cash payment hereunder constitutes a Net
GP-Related Recontribution Amount under Section 5.8(d)(ii).

(ii) (A) In the event any Partner or Withdrawn Partner or a partner or other
equity holder in any Other Fund GP (a “GP-Related Defaulting Party”) fails to
recontribute all or any portion of such GP-Related Defaulting Party’s Net
GP-Related Recontribution Amount for any reason, the Partnership shall require
all other Partners and Withdrawn Partners to contribute, on a pro rata basis
(based on each of their respective Carried Interest Give Back Percentages in the
case of Clawback Amounts, and GP-Related Profit Sharing Percentages in the case
of GP-Related Giveback Amounts (as more fully described in clause (II) of
Section 5.8(d)(i)(A) above)), such amounts as are necessary to fulfill the
GP-Related Defaulting Party’s obligation to pay such GP-Related Defaulting
Party’s Net GP-Related Recontribution Amount (a “GP-Related Deficiency
Contribution”) if the General Partner determines in its good faith judgment that
the Partnership (or Other Fund GP) will be unable to collect such amount in cash
from such GP-Related Defaulting Party for payment of the Clawback Amount or
GP-Related Giveback Amount, as the case may be, at least 20 Business Days prior
to the latest date that the Partnership, and the Other Fund GPs, if applicable,
are permitted to pay the Clawback Amount or GP-Related Giveback Amount, as the
case may be; provided, that, subject to Section 5.8(e), no Partner or

 

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Withdrawn Partner shall as a result of such GP-Related Deficiency Contribution
be required to contribute an amount in excess of 150% of the amount of the Net
GP-Related Recontribution Amount initially requested from such Partner or
Withdrawn Partner in respect of such default. Thereafter, the General Partner
shall determine in its good faith judgment that the Partnership should either
(1) not attempt to collect such amount in light of the costs associated
therewith, the likelihood of recovery and any other factors considered relevant
in the good faith judgment of the General Partner or (2) pursue any and all
remedies (at law or equity) available to the Partnership against the GP-Related
Defaulting Party, the cost of which shall be a Partnership expense to the extent
not ultimately reimbursed by the GP-Related Defaulting Party. It is agreed that
the Partnership shall have the right (effective upon such GP-Related Defaulting
Party becoming a GP-Related Defaulting Party) to set-off as appropriate and
apply against such GP-Related Defaulting Party’s Net GP-Related Recontribution
Amount any amounts otherwise payable to the GP-Related Defaulting Party by the
Partnership or any Affiliate thereof (including amounts unrelated to Carried
Interest, such as returns of capital and profit thereon). Each Partner and
Withdrawn Partner hereby grants to the Partnership a security interest,
effective upon such Partner or Withdrawn Partner becoming a GP-Related
Defaulting Party, in all accounts receivable and other rights to receive payment
from any Affiliate of the Partnership and agrees that, upon the effectiveness of
such security interest, the Partnership may sell, collect or otherwise realize
upon such collateral. In furtherance of the foregoing, each Partner and
Withdrawn Partner hereby appoints the Partnership as its true and lawful
attorney-in-fact with full irrevocable power and authority, in the name of such
Partner or Withdrawn Partner or in its own name, to take any actions which may
be necessary to accomplish the intent of the immediately preceding sentence. The
Partnership shall be entitled to collect interest on the Net GP-Related
Recontribution Amount of a GP-Related Defaulting Party from the date such Net
GP-Related Recontribution Amount was required to be contributed to the
Partnership at a rate equal to the Default Rate.

(B) Any Partner’s or Withdrawn Partner’s failure to make a GP-Related Deficiency
Contribution shall cause such Partner or Withdrawn Partner to be a GP-Related
Defaulting Party with respect to such amount. The Partnership shall first seek
any remaining Trust Amounts (and Trust Income thereon) allocated to a Partner or
Withdrawn Partner to satisfy such Partner’s or Withdrawn Partner’s obligation to
make a GP-Related Deficiency Contribution before seeking cash contributions from
such Partner or Withdrawn Partner in satisfaction of such Partner’s or Withdrawn
Partner’s obligation to make a GP-Related Deficiency Contribution.

(iii) A Partner or Withdrawn Partner’s obligation to make contributions to the
Partnership under this Section 5.8(d) shall survive the termination of the
Partnership.

(e) The Partners acknowledge that the General Partner will (and is hereby
authorized to) take such steps as it deems appropriate, in its good faith
judgment, to further the objective of providing for the fair and equitable
treatment of all Partners, including by allocating Writedowns and Net Losses (as
defined in the BSSF Europe Agreement) on GP-Related BSSF Europe Investments that
have been the subject of a Writedown and/or Net Losses (each, a “Loss
Investment”) to those Partners who participated in such Loss Investments based
on their Carried Interest Sharing Percentage therein to the extent that such
Partners receive or have received Carried Interest distributions from other
GP-Related BSSF Europe Investments. Consequently and notwithstanding anything
herein to the contrary, adjustments to Carried Interest distributions shall be
made as set forth in this Section 5.8(e).

 

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(i) At the time the Partnership is making Carried Interest distributions in
connection with a GP-Related BSSF Europe Investment (the “Subject Investment”)
that have been reduced under the BSSF Europe Agreement as a result of one or
more Loss Investments, the General Partner shall calculate amounts distributable
to or due from each such Partner as follows:

(A) determine each Partner’s share of each such Loss Investment based on his
Carried Interest Sharing Percentage in each such Loss Investment (which may be
zero) to the extent such Loss Investment has reduced the Carried Interest
distributions otherwise available for distribution to all Partners (indirectly
through Associates and the Partnership from BSSF Europe) from the Subject
Investment (such reduction, the “Loss Amount”);

(B) determine the amount of Carried Interest distributions otherwise
distributable to such Partner with respect to the Subject Investment (indirectly
through Associates and the Partnership from BSSF Europe) before any reduction in
respect of the amount determined in clause (A) above (the “Unadjusted Carried
Interest Distributions”); and

(C) subtract (I) the Loss Amounts relating to all Loss Investments from (II) the
Unadjusted Carried Interests Distributions for such Partner, to determine the
amount of Carried Interest distributions to actually be paid to such Partner
(“Net Carried Interest Distribution”).

To the extent that the Net Carried Interest Distribution for a Partner as
calculated in this clause (i) is a negative number, the General Partner shall
(I) notify such Partner, at or prior to the time such Carried Interest
distributions are actually made to the Partners, of his obligation to
recontribute to the Partnership prior Carried Interest distributions (a “Net
Carried Interest Distribution Recontribution Amount”), up to the amount of such
negative Net Carried Interest Distribution, and (II) to the extent amounts
recontributed pursuant to clause (I) are insufficient to satisfy such negative
Net Carried Interest Distribution amount, reduce future Carried Interest
distributions otherwise due such Partner, up to the amount of such remaining
negative Net Carried Interest Distribution. If a Partner’s (x) Net Carried
Interest Distribution Recontribution Amount exceeds (y) the aggregate amount of
prior Carried Interest distributions less the amount of tax thereon, calculated
based on the Assumed Tax Rate (as defined in the BSSF Europe Agreement) in
effect in the Fiscal Years of such distributions (the “Excess Tax-Related
Amount”), then such Partner may, in lieu of paying such Partner’s Excess
Tax-Related Amount, defer such amounts as set forth below. Such deferred amount
shall accrue interest at the Prime Rate. Such deferred amounts shall be reduced
and repaid by the amount of Carried Interest otherwise distributable to such
Partner in connection with future Carried Interest distributions until such
balance is reduced to zero. Any deferred amounts shall be payable in full upon
the earlier of (i) such time as the Clawback Amount is determined (as provided
herein) and (ii) such time as the Partner becomes a Withdrawn Partner.

To the extent there is an amount of negative Net Carried Interest Distribution
with respect to a Partner remaining after the application of this clause (i),
notwithstanding clause (II) of the preceding paragraph, such remaining amount of
negative Net Carried Interest Distribution shall be allocated to the other
Partners pro rata based on each of their Carried Interest Sharing Percentages in
the Subject Investment.

A Partner who fails to pay a Net Carried Interest Distribution Recontribution
Amount promptly upon notice from the General Partner (as provided above) shall
be deemed a GP-Related Defaulting Party for all purposes hereof.

 

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A Partner may satisfy in part any Net Carried Interest Distribution
Recontribution Amount from cash that is then subject to a Holdback, to the
extent that the amounts that remain subject to a Holdback satisfy the Holdback
requirements hereof as they relate to the reduced amount of aggregate Carried
Interest distributions received by such Partner (taking into account any Net
Carried Interest Distribution Recontribution Amount contributed to the
Partnership by such Partner).

Any Net Carried Interest Distribution Recontribution Amount contributed by a
Partner, including amounts of cash subject to a Holdback as provided above,
shall increase the amount available for distribution to the other Partners as
Carried Interest distributions with respect to the Subject Investment; provided,
that any such amounts then subject to a Holdback may be so distributed to the
other Partners to the extent a Partner receiving such distribution has satisfied
the Holdback requirements with respect to such distribution (taken together with
the other Carried Interest distributions received by such Partner to date).

(ii) In the case of Clawback Amounts which are required to be contributed to the
Partnership as otherwise provided herein, the obligation of the Partners with
respect to any Clawback Amount shall be adjusted by the General Partner as
follows:

(A) determine each Partner’s share of any Net Losses in any GP-Related BSSF
Europe Investments which gave rise to the Clawback Amount (i.e., the Net Losses
that followed the last GP-Related BSSF Europe Investment with respect to which
Carried Interest distributions were made), based on such Partner’s Carried
Interest Sharing Percentage in such GP-Related BSSF Europe Investments;

(B) determine each Partner’s obligation with respect to the Clawback Amount
based on such Partner’s Carried Interest Give Back Percentage as otherwise
provided herein; and

(C) subtract the amount determined in clause (B) above from the amount
determined in clause (A) above with respect to each Partner to determine the
amount of adjustment to each Partner’s share of the Clawback Amount (a Partner’s
“Clawback Adjustment Amount”).

A Partner’s share of the Clawback Amount shall for all purposes hereof be
decreased by such Partner’s Clawback Adjustment Amount, to the extent it is a
negative number (except to the extent expressly provided below). A Partner’s
share of the Clawback Amount shall for all purposes hereof be increased by such
Partner’s Clawback Adjustment Amount (to the extent it is a positive number);
provided, that in no way shall a Partner’s aggregate obligation to satisfy a
Clawback Amount as a result of this clause (ii) exceed the aggregate Carried
Interest distributions received by such Partner. To the extent a positive
Clawback Adjustment Amount remains after the application of this clause
(ii) with respect to a Partner, such remaining Clawback Adjustment Amount shall
be allocated to the Partners (including any Partner whose Clawback Amount was
increased pursuant to this clause (ii)) pro rata based on their Carried Interest
Give Back Percentages (determined without regard to this clause (ii)).

Any distribution or contribution adjustments pursuant to this Section 5.8(e) by
the General Partner shall be based on its good faith judgment, and no Partner
shall have any claim against the Partnership, the General Partner or any other
Partners as a result of any adjustment made as set forth above. This
Section 5.8(e) applies to all Partners, including Withdrawn Partners.

 

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It is agreed and acknowledged that this Section 5.8(e) is an agreement among the
Partners and in no way modifies the obligations of each Partner regarding the
Clawback Amount as provided in the BSSF Europe Agreement.

Section 5.9. Business Expenses. The Partnership shall reimburse the Partners for
reasonable travel, entertainment and miscellaneous expenses incurred by them in
their participation in the Partnership’s affairs in accordance with rules and
regulations established by the General Partner from time to time.

Section 5.10. Tax Capital Accounts; Tax Allocations.

For U.S. federal income tax purposes, there shall be established for each
Partner a single capital account combining such Partner’s Capital Commitment
Capital Account and GP-Related Capital Account, with such adjustments as the
General Partner determines are appropriate so that such single capital account
is maintained in compliance with the principles and requirements of
Section 704(b) of the Code and the Regulations thereunder.

(a) (b) For U.S. federal, state and local income tax purposes only, Partnership
income, gain, loss, deduction or expense (or any item thereof) for each fiscal
year shall be allocated to and among the Partners in a manner corresponding to
the manner in which corresponding items are allocated among the Partners
pursuant to clause (a) above, provided the General Partner may in its sole
discretion make such allocations for tax purposes as it determines are
appropriate so that allocations have substantial economic effect or are in
accordance with the interests of the Partners, within the meaning of the Code
and the Regulations thereunder.

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 month
(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 persons into the Partnership as General Partners or Limited Partners.
Each such person shall make the representations with respect to itself set forth
in Section 3.6. The General Partner shall determine and negotiate with the
additional Partner all terms of such additional Partner’s participation in the
Partnership, including the additional Partner’s initial GP-Related Capital
Contribution, Capital Commitment-Related Capital Contribution, GP-Related Profit
Sharing Percentage and Capital Commitment Profit Sharing Percentage. Each
additional Partner shall have such voting rights as determined by the General
Partner from time to time unless, upon the admission to the Partnership of any
Limited Partner, the General Partner shall designate that such Limited Partner
shall not have such voting rights (any such Limited Partner being called a
“Nonvoting Limited Partner”). Any additional Partner shall, as a condition to
becoming a Partner, agree to become a party to, and be bound by the terms and
conditions of, the Trust Agreement. If Blackstone or another or subsequent
holder of an Investor Note approved by the General Partner for purposes of this
Section 6.1(a) shall foreclose upon a Limited Partner’s Investor Note issued to
finance such Limited Partner’s purchase of his Capital Commitment Interests,
Blackstone or such other or subsequent holder shall succeed to such Limited
Partner’s Capital Commitment Interests and shall be deemed to have become a
Limited Partner to such extent.

 

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(b) The GP-Related Profit Sharing Percentages to be allocated to an additional
Partner as of the date such Partner is admitted to the Partnership, together
with the pro rata reduction in all other Partners’ GP-Related Profit Sharing
Percentages as of such date, shall be established by the General Partner
pursuant to Section 5.3. The Capital Commitment Profit Sharing Percentages to be
allocated to an additional Partner as of the date such Partner is admitted to
the Partnership, together with the pro rata reduction in all other Partners’
Capital Commitment Profit Sharing Percentages as of such date, shall be
established by the General Partner.

(c) An additional Partner shall be required to contribute to the Partnership his
pro rata share of the Partnership’s total capital, excluding capital in respect
of GP-Related Investments and Capital Commitment Investments in which such
Partner does not acquire any interests, at such times and in such amounts as
shall be determined by the General Partner in accordance with Sections 4.1 and
7.1.

(d) The admission of an additional Partner will be evidenced by the execution of
a counterpart copy of this Agreement by such additional Partner or the execution
of an amendment to this Agreement by all the Partners (including the additional
Partner), as determined by the General Partner, or the execution by such
additional Partner of any other writing evidencing the intent of such Person to
become a substitute or additional Limited Partner and such writing being
accepted by the General Partner on behalf of the Partnership, and the filing of
any certificates or notifications pursuant to the Partnership Act. In addition,
each additional Partner shall sign a counterpart copy of the Trust Agreement or
any other writing evidencing the intent of such Person to become a party to the
Trust Agreement.

Section 6.2. Withdrawal of Partners. (a) Any Partner may Withdraw voluntarily
from the Partnership on the last day of any 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 such 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 a Partner may Withdraw from the Partnership with respect
to such Partner’s GP-Related Partner Interest without Withdrawing from the
Partnership with respect to such Partner’s Capital Commitment Partner Interest,
and a Partner may Withdraw from the Partnership with respect to such Partner’s
Capital Commitment Partner Interest without Withdrawing from the Partnership
with respect to such Partner’s GP-Related Partner Interest.

(b) (i) Upon the death or Incompetence of any Limited Partner, or the occurrence
of any other mandatory Withdrawal event under the Partnership Act with respect
to any Limited Partner, such Limited Partner shall thereupon cease to be a
Limited Partner.

(ii) The General Partner may not assign or transfer all or any portion of its
interest in the Partnership (including its GP-Related Partner Interest and its
Capital Commitment Partner Interest) without the prior consent of all the
Limited Partners. Each Limited Partner agrees not to withhold its consent in the
event an assignment or transfer has been approved by Limited Partners whose
GP-Related Profit Sharing Percentages exceed two-thirds of the GP-Related Profit
Sharing Percentages of all Limited Partners (in each case, as last determined as
of the date of the consent). Notwithstanding the foregoing or any other
provision of this Agreement, the General Partner may, at any time prior to any
Disabling Event with respect to such General Partner and without the consent of
any other Partner, convert or merge into, or otherwise assign or transfer its
interest as the General Partner of the Partnership to, any other person, and
such person will succeed to the position of general partner of the Partnership,
with all the rights,

 

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powers and obligations associated therewith, provided that any individuals who
are partners of the Partnership will control and own (in the aggregate),
directly or indirectly, not less than a majority of the equity interests in such
other person. The Partners, upon the request of the General Partner, agree to
provide the General Partner a written ratification of such succession. If the
General Partner is converted to another type of entity pursuant to this
Section 6.2(b)(ii), the General Partner will not cease to be the General Partner
of the Partnership and, upon such conversion, the Partnership will continue
without dissolution. If a merger of the General Partner into another person
pursuant to this Section 6.2(b)(ii) will not result in the General Partner being
the surviving entity of the merger, the person that will be the surviving entity
in the merger with the General Partner will itself be admitted to the
Partnership as an additional general partner of the Partnership immediately
preceding the merger upon its execution of a counterpart to this Agreement and,
upon such merger, the Partnership will continue without dissolution. Any
purported assignment or transfer pursuant to this Section 6.2(b)(ii) which is
not in accordance with this Agreement shall be null and void. The General
Partner shall not cease to be the general partner of the Partnership upon the
collateral assignment of, or the pledging or granting of a security interest in,
its entire interest in the Partnership.

(c) Upon the Total Disability of a Special Limited Partner, such Partner shall
thereupon cease to be a Special Limited Partner with respect to such person’s
GP-Related Partner Interest; provided, however, that the General Partner may
elect to admit such Withdrawn Partner to the Partnership as a Nonvoting Limited
Partner with respect to such Partner’s GP-Related Partner Interest, with such
partnership interest as it 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.

(d) 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
GP-Related Partner Interest and/or with respect to such Partner’s Capital
Commitment Partner Interest, such Partner, upon written notice by the General
Partner to such Partner, shall be required to Withdraw with respect to such
Partner’s GP-Related Partner Interest and/or with respect to such Partner’s
Capital Commitment Partner 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 Partner requires any Partner to Withdraw for Cause
with respect to such Partner’s GP-Related Partner Interest and/or with respect
to such Partner’s Capital Commitment Partner Interest, such notice shall state
that it has been given for Cause and shall describe the particulars thereof in
reasonable detail.

(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 he was a General
Partner and resulting from his acts or omissions as a General Partner to the
fullest extent provided by law.

Section 6.3. GP-Related Partner Interests Not Transferable. (a) No Limited
Partner may sell, assign, pledge or otherwise transfer or encumber all or any
portion of such Partner’s GP-Related Partner Interest in the Partnership other
than as permitted by written agreement between such Partner and the Partnership;
provided, however, that this Section 6.3 shall not impair transfers by operation
of law occurring by virtue of the death or dissolution of a Partner; and
provided further, that a Special Limited

 

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Partner may assign up to 25% of his GP-Related Profit Sharing Percentage to an
estate planning trust, limited partnership or limited liability company with
respect to which such Special 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 Limited Partner. Such Special
Limited Partner and the Nonvoting Limited Partner will be jointly and severally
liable for all obligations of both such Special Limited Partner and such
Nonvoting Limited Partner with respect to the Partnership (including the
obligation to make additional GP-Related Capital Contributions). The General
Partner may at its sole option exercisable at any time require such 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(a), no assignee, legatee, distributee, heir or transferee (by
conveyance, operation of law or otherwise) of the whole or any portion of any
Partner’s GP-Related Partner Interest in the Partnership shall have any right to
be a General Partner or Limited Partner without the prior written consent of the
General Partner which may be given or withheld in its sole discretion.
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.

Section 6.4. General Partner Withdrawal; Transfer of General Partner’s Interest.
Except as contemplated by Section 6.2(b)(ii), withdrawal by a General Partner is
not permitted. The General Partner may, in accordance with Section 6.2(b)(ii),
transfer or assign its interest as a general partner in the Partnership to a
person who makes such representations with respect to itself as the General
Partner deems necessary or appropriate (with regard to compliance with
applicable law or otherwise). A person who is admitted as an additional or
substitute General Partner shall thereby become a General Partner and shall have
the right to manage the affairs and take part in the control of the Partnership
and to vote as a Partner to the extent of the interest in the Partnership so
acquired. The General Partner shall not cease to be the general partner of the
Partnership upon the collateral assignment of or the pledging or granting of a
security interest in its entire interest in the Partnership.

Section 6.5. Satisfaction and Discharge of a Withdrawn Partner’s Interest.
(a) The terms of this Section 6.5 shall apply to the GP-Related Partner Interest
of a Withdrawn Partner, but, except as otherwise expressly provided in this
Section 6.5, shall not apply to the Capital Commitment Partner Interest of a
Withdrawn Partner. The term “Settlement Date” means the date as of which a
Withdrawn Partner’s GP-Related Partner 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
GP-Related Partner 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 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 have the same
rights and obligations with respect to GP-Related Capital Contributions,
interest on capital, allocations of GP-Related 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 Limited Partner, the General Partner
shall promptly after such Withdrawn Partner’s Settlement Date (i) determine and
allocate to the Withdrawn Partner’s GP-Related Capital Account such Withdrawn
Partner’s allocable share of the GP-Related 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 GP-Related Capital Account with interest in
accordance with Section 5.2. In making the foregoing calculations, the General
Partner shall be entitled to establish

 

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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 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 or GP-Related Unallocated
Percentage in respect of the accounting period during which such Partner
Withdraws from the Partnership (whether or not previously awarded or allocated)
or any amounts or GP-Related Unallocated Percentage in respect of prior
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 the Withdrawn Partner, the Withdrawn
Partner’s GP-Related Profit Sharing Percentages shall, unless otherwise
allocated by the General Partner pursuant to Section 5.3(a), be deemed to be
GP-Related Unallocated Percentages (except for GP-Related Profit Sharing
Percentages with respect to GP-Related Investments as provided in paragraph
(f) below).

(e) (i) Upon the Withdrawal from the Partnership of a Partner with respect to
such Partner’s GP-Related Partner Interest, such Withdrawn Partner thereafter
shall not, except as expressly provided in this Section 6.5, have any rights of
a Partner (including voting rights) with respect to such Partner’s GP-Related
Partner Interest, and, except as expressly provided in this Section 6.5, such
Withdrawn Partner shall not have any interest in the Partnership’s GP-Related
Net Income (Loss) or in distributions, investments or other assets related to
such Partner’s GP-Related Partner Interest. If a Partner Withdraws from the
Partnership with respect to such Partner’s GP-Related Partner Interest for any
reason other than for Cause pursuant to Section 6.2, then the Withdrawn Partner
shall be entitled to receive, at the time or times specified in Section 6.5(i)
below, in satisfaction and discharge in full of the Withdrawn Partner’s
GP-Related Partner Interest in the Partnership, (x) payment equal to the
aggregate credit balance, if any, as of the Settlement Date of the Withdrawn
Partner’s GP-Related Capital Accounts, (excluding any GP-Related Capital Account
or portion thereof attributable to any GP-Related Investment) and (y) the
Withdrawn Partner’s percentage interest attributable to each GP-Related
Investment in which the Withdrawn Partner has an interest as of the Settlement
Date as provided in paragraph (f) below (which shall be settled in accordance
with paragraph (f) below), subject to all the terms and conditions of paragraphs
(a)-(p) of this Section 6.5. If the amount determined pursuant to clause
(x) 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(i) below; provided, that if
the Withdrawn Partner was solely a Limited Partner (other than a Special Limited
Partner) on his 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 GP-Related Capital Accounts
of a Withdrawn Partner who was solely a Limited Partner (other than a Special
Limited Partner), upon the settlement of such Withdrawn Partner’s GP-Related
Partner Interest in the Partnership pursuant to this Section 6.5, shall be
allocated among the other Partners’ GP-Related Capital Accounts in accordance
with their respective GP-Related Profit Sharing Percentages in the categories of
GP-Related 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 GP-Related Partner 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 GP-Related Partner 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 Limited Partner GP-Related Partner Interest and
retain such Partner’s GP-Related Profit Sharing Percentage in all (but not less

 

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than all) illiquid investments of the Partnership in lieu of a cash payment (or
Note) in settlement of that portion of the Withdrawn Partner’s GP-Related
Partner 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 GP-Related Partner Interest in the
Partnership pursuant to this Section 6.5.

(f) For purposes of clause (y) of paragraph (e)(i) above, a Withdrawn Partner’s
“percentage interest” means his GP-Related Profit Sharing Percentage as of the
Settlement Date in the relevant GP-Related Investment. The Withdrawn Partner
shall retain his percentage interest in such GP-Related Investment and shall
retain his GP-Related Capital Account or portion thereof attributable to such
GP-Related Investment, in which case such Withdrawn Partner (a “Retaining
Withdrawn Partner”) shall become a Nonvoting Limited Partner. The GP-Related
Partner Interest of a Retaining Withdrawn Partner pursuant to this paragraph
(f) shall be subject to the terms and conditions applicable to GP-Related
Partner Interests of any kind hereunder and such other terms and conditions as
are established by the General Partner. At the option of the General Partner in
its sole discretion, the General Partner and the Retaining Withdrawn Partner may
agree to have the Partnership acquire such GP-Related Partner Interest without
the approval of the other Partners; provided, that the General Partner shall
reflect in the books and records of the Partnership the terms of any acquisition
pursuant to this sentence.

(g) 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 GP-Related Partner
Interest. If any securities or other investments are distributed in kind to a
Withdrawn Partner under this paragraph (g), the amount described in clause
(x) of paragraph (e)(i) 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.

(h) [intentionally omitted].

(i) 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 GP-Related Partner 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 GP-Related Partner
Interest in the Partnership (e.g., payments in respect of GP-Related Investments
pursuant to paragraph (f) above or adjustments to reserves pursuant to paragraph
(j) below) 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 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.

 

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(j) 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 estate such excess, or to charge the Withdrawn Partner or his estate such
deficiency, as the case may be.

(k) Any amounts owed by the Withdrawn Partner to the Partnership 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 rate of interest publicly announced from time to time
by JPMorgan Chase Bank, N.A., as its 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(i) above shall be 120 days after a
Withdrawn Partner’s Settlement Date. The “due date” of amounts payable to or by
a Withdrawn Partner in respect of GP-Related Investments for which the Withdrawn
Partner has retained a percentage interest in accordance with paragraph
(f) above shall be 120 days after realization with respect to such GP-Related
Investment. The “due date” of any other amounts payable by a Withdrawn Partner
shall be 60 days after the date such amounts are determined to be payable.

(l) At the time of the settlement of any Withdrawn Partner’s GP-Related Partner
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 in any GP-Related Investment 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.

(m) If a Partner is required to Withdraw from the Partnership with respect to
such Partner’s GP-Related Partner Interest for Cause pursuant to Section 6.2(d),
then his GP-Related Partner Interest shall be settled in accordance with
paragraphs (a)-(r) of this Section 6.5; provided, however, that the General
Partner may elect (but shall not be required) to apply any or all the following
terms and conditions to such settlement:

(i) In settling the Withdrawn Partner’s interest in any GP-Related Investment in
which he has an interest as of his Settlement Date, the General Partner may
elect to (A) determine the GP-Related Unrealized Net Income (Loss) attributable
to each such GP-Related Investment as of the Settlement Date and allocate to the
appropriate GP-Related Capital Account of the Withdrawn Partner his allocable
share of such GP-Related Unrealized Net Income (Loss) for purposes of
calculating the aggregate balance of such Withdrawn Partner’s GP-Related Capital
Account pursuant to clause (x) of paragraph (e)(i) above, (B) credit or debit,
as applicable, the Withdrawn Partner with the balance of his GP-Related Capital
Account or portion thereof attributable to each such GP-Related Investment as of
his Settlement Date without giving effect to the GP-Related Unrealized Net
Income (Loss) from such GP-Related Investment as of his Settlement Date, which
shall be forfeited by the Withdrawn Partner or (C) apply the provisions of
paragraph (f) above, provided, that the maximum amount of GP-Related Net Income
(Loss) allocable to such Withdrawn Partner with respect to any GP-Related
Investment shall equal such Partner’s percentage interest of the GP-Related
Unrealized Net Income, if any, attributable to such GP-Related Investment as of
the Settlement Date (the balance of such GP-Related Net Income (Loss), if any,
shall be allocated as determined by the General Partner). The Withdrawn Partner
shall not have any continuing interest in any GP-Related Investment to the
extent an election is made pursuant to (A) or (B) above.

 

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(ii) 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 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
or on or after the applicable date of payment or distribution.

(n) 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 (o) may elect to forfeit the principal amount
payable in the final installment of his 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.

(o) In addition to the foregoing, the General Partner shall have the right to
pay a Withdrawn Partner (other than BSSF Europe (Cayman) or BSSF Europe GP
Delaware) a discretionary additional payment in an amount and based upon such
circumstances and conditions as it determines to be relevant. The provisions of
this Section 6.5 shall apply to any Investor Limited Partner relating to a
Limited Partner and to any transferee of any interest of such Partner pursuant
to Section 6.3 if such Partner Withdraws from the Partnership.

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

(ii) 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 estate or guardian, as
the case may be, prior to engaging such professionals. If the Withdrawn Partner
(or his 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 Limited Partner hereby irrevocably appoints the General Partner as such
Limited Partner’s true and lawful agent, representative and attorney-in-fact,
each acting alone, in such Limited Partner’s name, place and stead, to make,
execute, sign and file, on behalf of such Limited 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 Section 9.1 or this
Section 6.5, including, without limitation, the performance of any obligation of
such Limited Partner or the Partnership or the exercise of any right of such
Limited 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 Limited Partner for any reason and
shall not be affected by the death, disability or incapacity of such Limited
Partner.

 

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Section 6.6. Termination of 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, the
Partners’ respective interests in the Partnership shall be valued and settled in
accordance with the procedures set forth in Sections 6.5, 8.1 and Article IX,
which provide for allocations to the capital accounts of the Partners and
distributions in accordance with the capital account balances of the 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 U.S.
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 U.S. Treasury 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 Treasury 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 event there is a net decrease in partnership minimum
gain or partner nonrecourse debt minimum gain (determined in accordance with the
principles of Regulations Sections 1.704-2(d) and 1.704-2(i)) during any
Partnership taxable year, 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) The General Partner shall cause to be prepared all U.S. 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 shall not, unless he
provides prior notice of such action to the Partnership, (i) treat, on his
individual income tax returns, any item of income, gain, loss, deduction or
credit relating to his interest in the Partnership in a manner inconsistent with
the treatment of such item by the Partnership as reflected on the Form K-1 or
other information statement furnished by the Partnership to such Partner for use
in preparing his 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 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 Tax Matters Partner (as defined below) shall be
authorized to act for, and his 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 Tax Matters Partner 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

 

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reflected on any tax return of the Partnership (unless he 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 Tax
Matters Partner 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 Tax Matters Partner or with respect to any such amended
return or claim for refund filed by the Partnership or the Tax Matters Partner
or in any such administrative or judicial proceedings conducted by the
Partnership or the Tax Matters Partner. The Partnership and each Partner hereby
designate any Partner selected by the General Partner as the “tax matters
partner” for purposes of Section 6231(a)(7) of the Code (the “Tax Matters
Partner”). 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 6.8 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.

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

Section 6.8. Special Basis Adjustments. In connection with 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 Partnership and at
the time and in the manner provided in Regulations 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

CAPITAL COMMITMENT INTERESTS; CAPITAL CONTRIBUTIONS;

ALLOCATIONS; DISTRIBUTIONS

Section 7.1. Capital Commitment Interests, etc.

(a) (i) This Article VII and Article VIII hereof set forth certain terms and
conditions with respect to the Capital Commitment Partner Interests and the
Capital Commitment BSSF Europe Interest and matters related to the Capital
Commitment Partner Interests and the Capital Commitment BSSF Europe Interest.
Except as otherwise expressly provided in this Article VII or in Article VIII,
the terms and provisions of this Article VII and Article VIII shall not apply to
the GP-Related Partner Interests or the GP-Related Associates Interest.

(ii) Each Partner (other than BSSF Europe (Cayman)), severally, agrees to make
contributions of capital to the Partnership (“Capital Commitment-Related Capital
Contributions”) as required to fund the Partnership’s capital contribution to
Associates in respect of the Capital Commitment BSSF Europe Interest and the
related Capital Commitment BSSF Europe Commitment (including, without
limitation, funding all or a portion of the Blackstone Commitment). No Partner
shall be obligated to make Capital Commitment-Related Capital Contributions to
the Partnership in an amount in excess of such Partner’s agreed share of the
Blackstone Commitment. The Commitment Agreements and SMD Agreements, if any, of
the Partners may include provisions with respect to the foregoing matters. It is
understood that a

 

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Partner will not necessarily participate in each Capital Commitment Investment
(which may include additional amounts invested in an existing Capital Commitment
Investment) nor will a Partner necessarily have the same Capital Commitment
Profit Sharing Percentage with respect to (i) the Partnership’s portion of the
Blackstone Commitment or (ii) the making of each Capital Commitment Investment
in which such Partner participates; provided, that this in no way limits the
terms of any Commitment Agreement or SMD Agreement. In addition, nothing
contained herein shall be construed to give any Partner the right to obtain
financing with respect to the purchase of any Capital Commitment Interest, and
nothing contained herein shall limit or dictate the terms upon which the General
Partner and its Affiliates may provide such financing. The acquisition of a
Capital Commitment Interest by a Limited Partner shall be evidenced by receipt
by the Partnership of funds equal to such Limited Partner’s Capital Commitment –
Related Commitment then due with respect to such Capital Commitment Interest and
such appropriate documentation as the General Partner may submit to the Limited
Partners from time to time. If required by applicable law, the maximum amount of
Capital Commitment-Related Capital Contributions a Limited Partner is obligated
to contribute to the Partnership shall be disclosed in a Certificate filed in
accordance with the Partnership Act. Any provision of this Agreement to the
contrary notwithstanding, no Capital Commitment-Related Capital Contribution or
other capital contribution shall become due and payable or be required to be
made by any Partner, unless and until it shall be called by the General Partner
for the purposes set forth herein or in the Commitment Agreement of such
Partner. Notwithstanding the foregoing, the unfunded amount of any Partner’s
commitment to make Capital Commitment-Related Capital Contributions to the
Partnership (such Partner’s “Unfunded Capital Commitment-Related Commitment”)
may be determined and redetermined by the General Partner from time to time
(including, without limitation, any redetermination that results in a reduction
in such Partner’s Unfunded Capital Commitment-Related Commitment, which
reduction may be retroactive); provided that each Partner agrees to make Capital
Commitment-Related Capital Contributions in the full amount of such Partner’s
Unfunded Capital Commitment-Related Commitment at any time, on condition that
the General Partner does not thereafter make a redetermination that results in a
reduction in such Partner’s Unfunded Capital Commitment-Related Commitment and
subject to all other terms and conditions set forth herein and/or in any other
agreement relating thereto; and provided further, that, following an initial
determination of a Partner’s commitment to make Capital Commitment-Related
Capital Contributions, such Partner’s Unfunded Capital Commitment-Related
Commitment shall not be increased without the consent of such Partner.

(b) The General Partner or one of its Affiliates (in such capacity, the
“Advancing Party”) may in its sole discretion advance to any Limited 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) all or any portion of the Capital Commitment-Related Capital
Contributions due to the Partnership from such Limited Partner with respect to
any Capital Commitment Investment (“Firm Advances”). Each such Limited Partner
shall pay to the Advancing Party interest on each Firm Advance from the date of
such Firm Advance until the repayment thereof by such Limited Partner. Each Firm
Advance shall be repayable in full, including accrued interest to the date of
such repayment, upon prior written notice by the Advancing Party. The making and
repayment of each Firm Advance shall be recorded in the books and records of the
Partnership, and such recording shall be conclusive evidence of each such Firm
Advance, binding on the Limited Partner and the Advancing Party absent manifest
error. Except as provided below, the interest rate applicable to a Firm Advance
shall equal the cost of funds of the Advancing Party at the time of the making
of such Firm Advance. The Advancing Party shall inform any Limited Partner of
such rate upon such Limited Partner’s request; provided, that such interest rate
shall not exceed the maximum interest rate allowable by applicable law; provided
further, that amounts

 

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that are otherwise payable to such Limited Partner pursuant to Section 7.4(a)
shall be used to repay such Firm Advance (including interest thereon). The
Advancing Party may, in its sole discretion, change the terms of Firm Advances
(including the terms contained herein) and/or discontinue the making of Firm
Advances; provided, that (i) the Advancing Party shall notify the relevant
Limited Partners of any material changes to such terms and (ii) the interest
rate applicable to such Firm Advances and overdue amounts thereon shall not
exceed the maximum interest rate allowable by applicable law.

(c) BSSF Europe (Cayman) shall be required to make a maximum capital
contribution of (U.S.) $10. BSSF Europe (Cayman) shall have no Capital
Commitment Profit Sharing Percentage in Capital Commitment Net Income (Loss)
from any Capital Commitment Investment, but shall receive its pro rata share,
based on its capital contribution, of earnings on short-term and temporary
investments of the Partnership.

Section 7.2. Capital Commitment Capital Accounts.

(a) There shall be established for each Partner on the books of the Partnership
as of the date of formation of the Partnership, or such later date on which such
Partner is admitted to the Partnership, and on each such other date as such
Partner first acquires a Capital Commitment Interest in a particular Capital
Commitment Investment, a Capital Commitment Capital Account for each Capital
Commitment Investment in which such Partner acquires a Capital Commitment
Interest on such date. Each Capital Commitment-Related Capital Contribution of a
Partner shall be credited to the appropriate Capital Commitment Capital Account
of such Partner on the date such Capital Commitment-Related Capital Contribution
is paid to the Partnership. Capital Commitment Capital Accounts shall be
adjusted to reflect any transfer of a Partner’s interest in the Partnership
related to his Capital Commitment Partner Interest, as provided in this
Agreement.

(b) A Partner shall not have any obligation to the Partnership or to any other
Partner to restore any negative balance in the Capital Commitment Capital
Account of such Partner. Until distribution of any such Partner’s interest in
the Partnership with respect to a Capital Commitment Interest as a result of the
disposition by the Partnership of the related Capital Commitment Investment and
in whole upon the dissolution of the Partnership, neither his Capital Commitment
Capital Accounts nor any part thereof shall be subject to withdrawal or
redemption except with the consent of the General Partner.

Section 7.3. Allocations.

(a) Capital Commitment Net Income (Loss) of the Partnership for each Capital
Commitment Investment shall be allocated to the related Capital Commitment
Capital Accounts of all the Partners participating in such Capital Commitment
Investment in proportion to their respective Capital Commitment Profit Sharing
Percentages for such Capital Commitment Investment. Capital Commitment Net
Income (Loss) on any Unallocated Capital Commitment Interest shall be allocated
to each Partner in the proportion such Partner’s aggregate Capital Commitment
Capital Accounts bear to the aggregate Capital Commitment Capital Accounts of
all Partners; provided, that if any Partner makes the election provided for in
Section 7.6, Capital Commitment Net Income (Loss) of the Partnership for each
Capital Commitment Investment shall be allocated to the related Capital
Commitment Capital Accounts of all the Partners participating in such Capital
Commitment Investment who do not make such election in proportion to their
respective Capital Commitment Profit Sharing Percentages for such Capital
Commitment Investment.

 

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(b) Any special costs relating to distributions pursuant to Section 7.6 or 7.7
shall be specially allocated to the electing Limited Partner.

Section 7.4. Distributions.

(a) Each Limited Partner’s allocable portion of Capital Commitment Net Income
received from his Capital Commitment Investments, distributions to such Limited
Partner that constitute returns of capital, and other Capital Commitment Net
Income of the Partnership (including without limitation Capital Commitment Net
Income attributable to Unallocated Capital Commitment Interests) during a fiscal
year of the Partnership will be credited to payment of the Investor Notes to the
extent required below as of the last day of such fiscal year (or on such earlier
date as related distributions are made in the sole discretion of the General
Partner) with any cash amount distributable to such Limited Partner pursuant to
clauses (ii) and (vii) below to be distributed within 45 days after the end of
each fiscal year of the Partnership (or in each case on such earlier date as
selected by the General Partner in its sole discretion) as follows (subject to
Section 7.4(c) below):

(i) First, to the payment of interest then due on all Investor Notes (relating
to Capital Commitment Investments or otherwise) of such Limited Partner (to the
extent Capital Commitment Net Income and distributions or payments from Other
Sources do not equal or exceed all interest payments due, the selection of those
of such Limited Partner’s Investor Notes upon which interest is to be paid and
the division of payments among such Investor Notes to be determined by the
Lender or Guarantor);

(ii) Second, to distribution to the Limited Partner of an amount equal to the
U.S. Federal, state and local income taxes on income of the Partnership
allocated to such Limited Partner for such year in respect of such Limited
Partner’s Capital Commitment Partner Interest (the aggregate amount of any such
distribution shall be determined by the General Partner, subject to the
limitation that the minimum aggregate amount of such distribution be the tax
that would be payable if the taxable income of the Partnership related to all
Partners’ Capital Commitment Partner Interests were all allocated to an
individual subject to the then-prevailing maximum U.S. Federal, New York State
and New York City tax rates (taking into account the extent to which such
taxable income allocated by the Partnership was composed of long-term capital
gains and the deductibility of state and local income taxes for U.S. Federal
income tax purposes)); provided, that additional amounts shall be paid to the
Limited Partner pursuant to this clause (ii) to the extent that such amount
reduces the amount otherwise distributable to the Limited Partner pursuant to a
comparable provision in any other BCE Agreement and there are not sufficient
amounts to fully satisfy such provision from the relevant partnership or other
entity; provided further, that amounts paid pursuant to the provisions in such
other BCE Agreements comparable to the immediately preceding proviso shall
reduce those amounts otherwise distributable to the Limited Partner pursuant to
provisions in such other BCE Agreements that are comparable to this clause (ii);

(iii) Third, to the payment in full of the principal amount of the Investor Note
financing (A) any Capital Commitment Investment disposed of during or prior to
such fiscal year or (B) any BCE Investments (other than Capital Commitment
Investments) disposed of during or prior to such fiscal year, to the extent not
repaid from Other Sources;

(iv) Fourth, to the return to such Limited Partner of (A) all Capital
Commitment-Related Capital Contributions made in respect of the Capital
Commitment Interest to which any Capital Commitment Investment disposed of
during or prior to such fiscal year

 

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relates or (B) all capital contributions made to any Blackstone Collateral
Entity (other than the Partnership) in respect of interests therein relating to
BCE Investments (other than Capital Commitment Investments) disposed of during
or prior to such fiscal year (including all principal paid on the related
Investor Notes), to the extent not repaid from amounts of Other Sources (other
than amounts of CC Carried Interest);

(v) Fifth, to the payment of principal (including any previously deferred
amounts) then owing under all other Investor Notes of such Limited Partner
(including those unrelated to the Partnership), the selection of those of such
Limited Partner’s Investor Notes to be repaid and the division of payments among
such Investor Notes to be determined by the Lender or Guarantor;

(vi) Sixth, up to 50% of any Capital Commitment Net Income remaining after
application pursuant to clauses (i) through (v) above shall be applied pro rata
to prepayment of principal of all remaining Investor Notes of such Limited
Partner (including those unrelated to the Partnership), the selection of those
of such Limited Partner’s Investor Notes to be repaid, the division of payments
among such Investor Notes and the percentage of remaining Capital Commitment Net
Income to be applied thereto to be determined by the Lender or Guarantor; and

(vii) Seventh, to such Limited Partner to the extent of any amount of Capital
Commitment Net Income remaining after making the distributions in clauses
(i) through (vi) above, and such amount is not otherwise required to be applied
to Investor Notes pursuant to the terms thereof.

To the extent there is a partial disposition of a Capital Commitment Investment
or any other BCE Investment, as applicable, the payments in clauses (iii) and
(iv) above shall be based on that portion of the Capital Commitment Investment
or other BCE Investment, as applicable, disposed of, and the principal amount
and related interest payments of such Investor Note shall be adjusted to reflect
such partial payment so that there are equal payments over the remaining term of
the related Investor Note. For a Limited Partner who is no longer an employee or
officer of Blackstone, distributions shall be made pursuant to clauses
(i) through (iii) above, and then, unless the General Partner or its Affiliate
has exercised its rights pursuant to Section 8.1 hereof, any remaining income or
other distribution in respect of such Limited Partner’s Capital Commitment
Partner Interest shall be applied to the prepayment of the outstanding Investor
Notes of such Limited Partner, until all such Limited Partner’s Investor Notes
have been repaid in full, with any such income or other distribution remaining
thereafter distributed to such Limited Partner.

Distributions of Capital Commitment Net Income may be made at any other time at
the discretion of the General Partner. At the General Partner’s discretion, any
amounts distributed to a Limited Partner in respect of such Limited Partner’s
Capital Commitment Partner Interest will be net of any interest and principal
payable on his Investor Notes for the full period in respect of which the
distribution is made.

(b) [Intentionally omitted]

(c) To the extent that the foregoing Partnership distributions and distributions
and payments from Other Sources are insufficient to satisfy any principal and/or
interest due on Investor Notes, and to the extent that the General Partner in
its sole discretion elects to apply this paragraph (c) to any individual
payments due, such unpaid interest will be added to the remaining principal
amount of such Investor Notes and shall be payable on the next scheduled
principal payment date (along with any deferred principal and any principal and
interest due on such date); provided, that such deferral shall not apply to a
Limited Partner that is no longer an employee or officer of Blackstone. All
unpaid interest on such Investor Notes shall accrue interest at the interest
rate then in effect for such Investor Notes.

 

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(d) [Intentionally omitted]

(e) The Capital Commitment Capital Account of each Partner shall be reduced by
the amount of any distribution to such Partner pursuant to paragraph (a) of this
Section 7.4.

(f) At any time that a sale, exchange, transfer or other disposition of a
portion of a Capital Commitment Investment is being considered by the
Partnership or BSSF Europe (a “Capital Commitment Disposable Investment”), at
the election of the General Partner each Partner’s Capital Commitment Interest
with respect to such Capital Commitment Investment shall be vertically divided
into two separate Capital Commitment Interests, a Capital Commitment Interest
attributable to the Capital Commitment Disposable Investment (a Partner’s
“Capital Commitment Class B Interest”), and a Capital Commitment Interest
attributable to such Capital Commitment Investment excluding the Capital
Commitment Disposable Investment (a Partner’s “Capital Commitment Class A
Interest”). Distributions (including those resulting from a direct or indirect
sale, transfer, exchange or other disposition by the Partnership) relating to a
Capital Commitment Disposable Investment shall be made only to holders of
Capital Commitment Class B Interests with respect to such Capital Commitment
Investment in accordance with their respective Capital Commitment Profit Sharing
Percentages relating to such Capital Commitment Class B Interests, and
distributions (including those resulting from the direct or indirect sale,
transfer, exchange or other disposition by the Partnership) relating to a
Capital Commitment Investment excluding such Capital Commitment Disposable
Investment shall be made only to holders of Capital Commitment Class A Interests
with respect to such Capital Commitment Investment in accordance with their
respective Capital Commitment Profit Sharing Percentages relating to such
Capital Commitment Class A Interests.

(g) (i) If Associates is obligated under the Giveback Provisions to contribute
to BSSF Europe a Giveback Amount with respect to the Capital Commitment BSSF
Europe Interest and the Partnership is obligated to contribute any such amount
to Associates in respect of the Partnership’s Capital Commitment Associates
Partner Interest (the amount of such obligation being herein called a “Capital
Commitment Giveback Amount”), the Partnership shall call for such amounts as are
necessary to satisfy such obligation of the Partnership as determined by the
General Partner, in which case each Partner shall contribute to the Partnership,
in cash, when and as called by the Partnership, such an amount of prior
distributions by the Partnership with respect to the Capital Commitment BSSF
Europe Interest (the “Capital Commitment Recontribution Amount”) which equals
such Partner’s pro rata share of prior distributions in connection with (a) the
Capital Commitment BSSF Europe Investment giving rise to the Capital Commitment
Giveback Amount, (b) if the amounts contributed pursuant to clause (a) above are
insufficient to satisfy such Capital Commitment Giveback Amount, Capital
Commitment BSSF Europe Investments other than the one giving rise to such
obligation, but only those amounts received by the Partners with an interest in
the Capital Commitment BSSF Europe Investment referred to in clause (a) above,
and (c) if the Capital Commitment Giveback Amount pursuant to an applicable BSSF
Europe Agreement is unrelated to a specific Capital Commitment BSSF Europe
Investment, all Capital Commitment BSSF Europe Investments. Each Partner shall
promptly contribute to the Partnership upon notice thereof such Partner’s
Capital Commitment Recontribution Amount. Prior to such time, the Partnership
may, in the General Partner’s discretion (but shall be under no obligation to),
provide notice that in the General Partner’s judgment, the potential obligations
in respect of the Giveback Provisions will probably materialize (and an estimate
of the aggregate amount of such obligations).

 

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(ii) (A) In the event any Partner (a “Capital Commitment Defaulting Party”)
fails to recontribute all or any portion of such Capital Commitment Defaulting
Party’s Capital Commitment Recontribution Amount for any reason, the Partnership
shall require all other Partners and Withdrawn Partners to contribute, on a pro
rata basis (based on each of their respective Capital Commitment Profit Sharing
Percentages), such amounts as are necessary to fulfill the Capital Commitment
Defaulting Party’s obligation to pay such Capital Commitment Defaulting Party’s
Capital Commitment Recontribution Amount (a “Capital Commitment Deficiency
Contribution”) if the General Partner determines in its good faith judgment that
the Partnership will be unable to collect such amount in cash from such Capital
Commitment Defaulting Party for payment of the Capital Commitment Giveback
Amount at least 20 Business Days prior to the latest date that the Partnership
is permitted to pay the Capital Commitment Giveback Amount; provided, that no
Partner shall as a result of such Capital Commitment Deficiency Contribution be
required to contribute an amount in excess of 150% of the amount of the Capital
Commitment Recontribution Amount initially requested from such Partner in
respect of such default. Thereafter, the General Partner shall determine in its
good faith judgment that the Partnership should either (1) not attempt to
collect such amount in light of the costs associated therewith, the likelihood
of recovery and any other factors considered relevant in the good faith judgment
of the General Partner or (2) pursue any and all remedies (at law or equity)
available to the Partnership against the Capital Commitment Defaulting Party,
the cost of which shall be a Partnership expense to the extent not ultimately
reimbursed by the Capital Commitment Defaulting Party. It is agreed that the
Partnership shall have the right (effective upon such Capital Commitment
Defaulting Party becoming a Capital Commitment Defaulting Party) to set-off as
appropriate and apply against such Capital Commitment Defaulting Party’s Capital
Commitment Recontribution Amount any amounts otherwise payable to the Capital
Commitment Defaulting Party by the Partnership or any Affiliate thereof. Each
Partner hereby grants to the Partnership a security interest, effective upon
such Partner becoming a Capital Commitment Defaulting Party, in all accounts
receivable and other rights to receive payment from the Partnership or any
Affiliate of the Partnership and agrees that, upon the effectiveness of such
security interest, the Partnership may sell, collect or otherwise realize upon
such collateral. In furtherance of the foregoing, each Partner hereby appoints
the Partnership as its true and lawful attorney-in-fact with full irrevocable
power and authority, in the name of such Partner or in the name of the
Partnership, to take any actions which may be necessary to accomplish the intent
of the immediately preceding sentence. The Partnership shall be entitled to
collect interest on the Capital Commitment Recontribution Amount of a Capital
Commitment Defaulting Party from the date such Capital Commitment Recontribution
Amount was required to be contributed to the Partnership at a rate equal to the
Default Rate.

(B) Any Partner’s failure to make a Capital Commitment Deficiency Contribution
shall cause such Partner to be a Capital Commitment Defaulting Party with
respect to such amount.

(iii) A Partner’s obligation to make contributions to the Partnership under this
Section 7.4(g) shall survive the termination of the Partnership.

Section 7.5. Valuations. Capital Commitment Investments shall be valued annually
as of the end of each year (and at such other times as deemed appropriate by the
General Partner) in accordance with the principles utilized by Associates (or
any other Affiliate that is a general partner of BSSF Europe) in valuing
investments of BSSF Europe or, in the case of investments not held by BSSF
Europe, in the good faith judgment of the General Partner, subject in each case
to the second proviso of the immediately succeeding sentence. The value of any
Capital Commitment Interest as of any date (the

 

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“Capital Commitment Value”) shall be based on the value of the underlying
Capital Commitment Investment as set forth above; provided, that the Capital
Commitment Value may be determined as of an earlier date if determined
appropriate by the General Partner in good faith; provided further, that such
value may be adjusted by the General Partner to take into account factors
relating solely to the value of a Capital Commitment Interest (as compared to
the value of the underlying Capital Commitment Investment), such as restrictions
on transferability, the lack of a market for such Capital Commitment Interest
and lack of control of the underlying Capital Commitment Investment. To the full
extent permitted by applicable law such valuations shall be final and binding on
all Partners; provided further, that the immediately preceding proviso shall not
apply to any Capital Commitment Interests held by a person who is or was at any
time a member of the General Partner.

Section 7.6. Disposition Election.

(a) At any time prior to the date of the Partnership’s execution of a definitive
agreement to dispose of a Capital Commitment Investment, the General Partner may
in its sole discretion permit a Partner to retain all or any portion of its pro
rata share of such Capital Commitment Investment (as measured by such Partner’s
Capital Commitment Profit Sharing Percentage in such Capital Commitment
Investment). If the General Partner so permits, such Partner shall instruct the
General Partner in writing prior to such date (i) not to dispose of all or any
portion of such Partner’s pro rata share of such Capital Commitment Investment
(the “Retained Portion”) and (ii) either to (A) distribute such Retained Portion
to such Partner on the closing date of such disposition or (B) retain such
Retained Portion in the Partnership on behalf of such Partner until such time as
such Partner shall instruct the General Partner upon 5 days notice to distribute
such Retained Portion to such Partner. Such Partner’s Capital Commitment Capital
Account shall not be adjusted in any way to reflect the retention in the
Partnership of such Retained Portion or the Partnership’s disposition of other
Partners’ pro rata shares of such Capital Commitment Investment; provided, that
such Partner’s Capital Commitment Capital Account shall be adjusted upon
distribution of such Retained Portion to such Partner or upon distribution of
proceeds with respect to a subsequent disposition thereof by the Partnership.

(b) No distribution of such Retained Portion shall occur unless any Investor
Notes relating thereto shall have been paid in full prior to or simultaneously
with such distribution.

Section 7.7. Capital Commitment Special Distribution Election.

(a) From time to time during the term of this Agreement, the General Partner may
in its sole discretion, upon receipt of a written request from a Partner,
distribute to such Partner any portion of its pro rata share of a Capital
Commitment Investment (as measured by such Partner’s Capital Commitment Profit
Sharing Percentage in such Capital Commitment Investment) (a “Capital Commitment
Special Distribution”). Such Partner’s Capital Commitment Capital Account shall
be adjusted upon distribution of such Capital Commitment Special Distribution.

(b) No Capital Commitment Special Distributions shall occur unless any Investor
Notes relating thereto shall have been paid in full prior to or simultaneously
with such Capital Commitment Special Distribution.

 

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ARTICLE VIII

WITHDRAWAL; DISSOLUTION; ADMISSION OF NEW PARTNERS

Section 8.1. Limited Partner Withdrawal; Repurchase of Capital Commitment
Interests. (a) Capital Commitment Interests (or a portion thereof) that were
financed by Investor Notes will be treated as not subject to repurchase for
purposes hereof based upon the proportion of (a) the sum of Capital
Commitment-Related Capital Contributions not financed by an Investor Note with
respect to each Capital Commitment Interest and principal payments on the
related Investor Note to (b) the sum of the Capital Commitment-Related Capital
Contributions not financed by an Investor Note with respect to such Capital
Commitment Interest, the original principal amount of such Investor Note and all
deferred amounts of interest which from time to time comprise part of the
principal amount of the Investor Note. A Limited Partner may prepay a portion of
any outstanding principal on the Investor Notes; provided, that in the event
that a Limited Partner prepays all or any portion of the principal amount of the
Investor Notes within nine months prior to the date on which such Limited
Partner is no longer an employee or officer of Blackstone, the Partnership (or
its designee) shall have the right, in its sole discretion, to purchase the
Capital Commitment Interest that became Non-Contingent as a result of such
prepayment; provided further, that the purchase price for such Capital
Commitment Interest shall be determined in accordance with the determination of
the purchase price of a Limited Partner’s Contingent Capital Commitment
Interests as set forth in paragraph (b) below. Prepayments made by a Limited
Partner shall apply pro rata against all of such Limited Partner’s Investor
Notes; provided, that such Limited Partner may request that such prepayments be
applied only to Investor Notes related to BCE Investments that are related to
one or more Blackstone Collateral Entities specified by such Limited Partner.
Except as expressly provided herein, Capital Commitment Interests that were not
financed in any respect with Investor Notes shall be treated as Non-Contingent
Capital Commitment Interests.

(b) Upon a Limited Partner ceasing to be an officer or employee of the General
Partner or any of its Affiliates, other than as a result of such Limited Partner
dying or suffering a Total Disability, such Limited Partner (the “Withdrawn
Partner”) and the Partnership or any other person designated by the General
Partner shall each have the right (exercisable by the Withdrawn Partner within
30 days and by the Partnership or its designee(s) within 45 days of such Limited
Partner’s ceasing to be such an officer or employee) or any time thereafter,
upon 30 days notice, but not the obligation, to require the Partnership, subject
to the Partnership Act, to buy (in the case of exercise of such right by such
Withdrawn Partner) or the Withdrawn Partner to sell (in the case of exercise of
such right by the Partnership or its designee(s)) all (but not less than all)
such Withdrawn Partner’s Contingent Capital Commitment Interests. The purchase
price for each such Contingent Capital Commitment Interest will be an amount
equal to (i) the outstanding principal amount of the related Investor Note plus
accrued interest thereon to the date of purchase (such portion of the purchase
price to be made in cash) and (ii) an additional amount (the “Adjustment
Amount”) equal to (x) all interest paid by the Limited Partner on the portion of
the principal amount of the Investor Note relating to the portion of the related
Capital Commitment Interest remaining Contingent plus (y) all Capital Commitment
Net Losses allocated to the Withdrawn Partner on the Contingent portion of such
Capital Commitment Interest minus (z) all Capital Commitment Net Income
allocated to the Withdrawn Partner on the Contingent portion of such Capital
Commitment Interest; provided, that, if the Withdrawn Partner was terminated
from employment or membership for Cause, the amounts referred to in clause
(x) or (y) of the Adjustment Amount, in the General Partner’s sole discretion,
may be deemed to equal zero. The Adjustment Amount shall, if positive, be
payable by the holders of the purchased Capital Commitment Interests to the
Withdrawn Partner from the next Capital Commitment Net Income received by such
holders on the Contingent portion of such Withdrawn Partner’s Capital Commitment
Interests at the time such Capital Commitment

 

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Net Income is received. If the Adjustment Amount resulting from an exchange is
negative, it shall be payable to the holders of the purchased Capital Commitment
Interest by the Withdrawn Partner at the time such Capital Commitment Net Income
is received by the Withdrawn Partner from the next Capital Commitment Net Income
on the Non-Contingent portion of the Withdrawn Partner’s Capital Commitment
Interests or, if the Partnership or its designee(s) elect to purchase such
Withdrawn Partner’s Non-Contingent Capital Commitment Interests, in cash by the
Withdrawn Partner at the time of such purchase; provided, that the General
Partner and its Affiliates may offset any amounts otherwise owing to a Withdrawn
Partner against any Adjustment Amount owed by such Withdrawn Partner. Until so
paid, such remaining Adjustment Amount will not itself bear interest. At the
time of such purchase of the Withdrawn Partner’s Contingent Capital Commitment
Interest, his related Investor Note shall be payable in full. If neither the
Withdrawn Partner nor the Partnership nor its designee(s) exercise the right to
require repurchase of such Contingent Capital Commitment Interests, then the
Withdrawn Partner shall retain the Contingent portion of his Capital Commitment
Interests and the Investor Notes shall remain outstanding, shall become fully
recourse to the Withdrawn Partner in his individual capacity, shall be payable
in accordance with their remaining original maturity schedules and shall be
prepayable at any time by the Withdrawn Partner at his option, and the General
Partner shall apply such prepayments against outstanding Investor Notes on a pro
rata basis. To the extent that another Partner purchases a portion of a Capital
Commitment Interest of a Withdrawn Partner, the purchasing Partner’s Capital
Commitment Capital Account and Capital Commitment Profit Sharing Percentage for
such Capital Commitment Investment shall be correspondingly increased.

(c) Upon the occurrence of a Final Event with respect to any Limited Partner,
such Limited Partner shall thereupon cease to be a Partner with respect to such
Limited Partner’s Capital Commitment Partner Interest. If such a Final Event
shall occur, no Successor in Interest to any such Limited Partner shall for any
purpose hereof become or be deemed to become a Partner. The sole right, as
against the Partnership and the remaining Partners, acquired hereunder by, or
resulting hereunder to, a Successor in Interest to any Partner shall be to
receive any distributions and allocations with respect to such Limited Partner’s
Capital Commitment Partner Interest pursuant to Article VII and this Article
VIII, subject to the right of the Partnership to purchase the Capital Commitment
Interests of such former Partner pursuant to Section 8.1(b) or Section 8.1(d))
to the extent, at the time, in the manner and in the amount otherwise payable to
such Limited Partner had such a Final Event not occurred, and no other right
shall be acquired hereunder by, or shall result hereunder to, a Successor in
Interest to such Partner, whether by operation of law or otherwise. Until
distribution of any such Partner’s interest in the Partnership upon the
dissolution of the Partnership as provided in Section 9.2, neither his Capital
Commitment Capital Accounts nor any part thereof shall be subject to withdrawal
or redemption without the consent of the General Partner. The Partnership shall
be entitled to treat any Successor in Interest to such Partner as the only
person entitled to receive distributions and allocations hereunder with respect
to such Partner’s Capital Commitment Partner Interest.

(d) If a Limited Partner dies or suffers a Total Disability, all Contingent
Capital Commitment Interests of such Partner shall be purchased by the
Partnership or its designee (within 30 days of the first date on which the
Partnership knows or has reason to know of such Limited Partner’s death or
disability) as provided in Section 8.1(b) (except that any Adjustment Amount
shall be payable by or to the estate or personal representative in cash), and
any Investor Notes financing such Contingent Capital Commitment Interests shall
thereupon be prepaid as provided in Section 8.1(b). In addition, in the case of
the death or Total Disability of a Limited Partner, if the estate or personal
representative of such Limited Partner so requests in writing within 180 days of
the Limited Partner’s death or ceasing to be an employee or member (directly or
indirectly) of the General Partner or any of its Affiliates by reason of Total
Disability (such requests shall not exceed one per calendar year), the
Partnership or its designee

 

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may but is not obligated to purchase for cash all (but not less than all)
Non-Contingent Capital Commitment Interests of such Limited Partner as of the
last day of the Partnership’s then current fiscal year at a price equal to the
Capital Commitment Value thereof. Each Limited Partner shall be required to
include appropriate provisions in his will to reflect such provisions of the
Partnership Agreement. In addition, the Partnership may, in the sole discretion
of the General Partner, upon notice to the estate or personal representative of
such Limited Partner within 30 days of the first date on which the Partnership
knows or has reason to know of such Limited Partner’s death or Total Disability,
determine either (i) to distribute Securities or other property to the estate or
personal representative in exchange for such Non-Contingent Capital Commitment
Interests as provided in Section 8.1(e) or (ii) to require sale of such
Non-Contingent Capital Commitment Interests to the Partnership or its designee
as of the last day of any fiscal year of the Partnership (or earlier period, as
determined by the General Partner in its sole discretion) for an amount in cash
equal to the Capital Commitment Value thereof.

(e) In lieu of retaining a Withdrawn Partner as a Limited Partner with respect
to any Non-Contingent Capital Commitment Interests, the General Partner may, in
its sole discretion, by notice to such Withdrawn Partner within 45 days of his
ceasing to be an employee or officer of the General Partner or any of its
Affiliates, or at any time thereafter, upon 30 days written notice, determine
(1) to distribute to such Withdrawn Partner the pro rata portion of the
Securities or other property underlying such Withdrawn Partner’s Non-Contingent
Capital Commitment Interests, subject to any restrictions on distributions
associated with the Securities or other property, in satisfaction of his
Non-Contingent Capital Commitment Interests in the Partnership or (2) to cause,
as of the last day of any fiscal year of the Partnership (or earlier period, as
determined by the General Partner in its sole discretion), the Partnership or
another person designated by the General Partner (who may be itself another
Limited Partner or another Affiliate of the General Partner) to purchase all
(but not less than all) of such Withdrawn Partner’s Non-Contingent Capital
Commitment Interests for a price equal to the Capital Commitment Value thereof.
The General Partner shall condition any distribution or purchase of voting
Securities pursuant to paragraph (d) above or this paragraph (e) upon the
Withdrawn Partner’s execution and delivery to the Partnership of an appropriate
irrevocable proxy, in favor of the Partnership or its nominee, relating to such
Securities.

(f) The Partnership may subsequently transfer any Unallocated Capital Commitment
Interest or portion thereof which is purchased by it as described above to any
other person approved by the General Partner. In connection with such purchase
or transfer or the purchase of a Capital Commitment Interest or portion thereof
by the Partnership’s designee(s), Blackstone may loan all or a portion of the
purchase price of the transferred or purchased Capital Commitment Interest to
the Partnership, the transferee or the designee-purchaser(s), as applicable. To
the extent that a Withdrawn Partner’s Capital Commitment Interests (or portions
thereof) are repurchased by the Partnership and not transferred to or purchased
by another person, all or any portion of such repurchased Capital Commitment
Interests may, in the sole discretion of the General Partner, (i) be allocated
to each Partner already participating in the Capital Commitment Investment to
which the repurchased Capital Commitment Interest relates, (ii) be allocated to
each Partner in the Partnership, whether or not already participating in such
Capital Commitment Investment, and/or (iii) continue to be held by Partnership
itself as an unallocated Capital Commitment Investment (such Capital Commitment
Interests being herein called “Unallocated Capital Commitment Interests”). To
the extent that a Capital Commitment Interest is allocated to Partners as
provided in clause (i) and/or (ii) above, any indebtedness incurred by the
Partnership to finance such repurchase shall also be allocated to such Partners.
All such Capital Commitment Interests allocated to Limited Partners shall be
deemed to be Contingent and shall become Non-Contingent as and to the extent
that the principal amount of such related indebtedness is repaid. The Limited
Partners receiving such allocations shall be responsible for such related
indebtedness only on a

 

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nonrecourse basis to the extent appropriate as provided in this Agreement,
except as such Limited Partners and the General Partner shall otherwise agree.
If the indebtedness financing such repurchased interests is not so limited, the
Partnership may require an assumption by the Limited Partners of such
indebtedness on the terms thereof as a precondition to allocation of the related
Capital Commitment Interests to such Limited Partners; provided, that a Limited
Partner shall not, except as set forth in his Investor Note, be obligated to
accept any personally recourse obligation unless his prior consent is obtained.
So long as the Partnership itself retains the Unallocated Capital Commitment
Interests pursuant to clause (iii) above, such Unallocated Capital Commitment
Interests shall belong to the Partnership and any indebtedness financing the
Unallocated Capital Commitment Interests shall be an obligation of the
Partnership to which all income of the Partnership is subject except as
otherwise agreed by the lender of such indebtedness. Any Capital Commitment Net
Income (Loss) on an Unallocated Capital Commitment Interest shall be allocated
to each Partner in the proportion his aggregate Capital Commitment Capital
Accounts bear to the aggregate Capital Commitment Capital Accounts of all
Partners; debt service on such related financing will be an expense of the
Partnership allocable to all Partners in such proportions.

(g) If a Partner is required to Withdraw from the Partnership with respect to
such Partner’s Capital Commitment Partner Interest for Cause, then his Capital
Commitment Interest shall be settled in accordance with paragraphs (a)-(f) and
(j) of this Section 8.1; provided, that if such Partner was not at any time a
direct partner of the Partnership, the General Partner may elect (but shall not
be required) to apply any or all the following terms and conditions to such
settlement:

(i) purchase for cash all of such Withdrawn Partner’s Non-Contingent Capital
Commitment Interests. The purchase price for each such Non-Contingent Capital
Commitment Interest shall be the lower of (A) the original cost of such
Non-Contingent Capital Commitment Interest or (B) an amount equal to the Capital
Commitment Value thereof;

(ii) allow the Withdrawn Partner to retain such Non-Contingent Capital
Commitment Interests; provided, that the maximum amount of Capital Commitment
Net Income allocable to such Withdrawn Partner with respect to any Capital
Commitment Investment shall equal the amount of Capital Commitment Net Income
that would have been allocated to such Withdrawn Partner if such Capital
Commitment Investment had been sold as of the Settlement Date at the then
prevailing Capital Commitment Value thereof; or

(iii) in lieu of cash, purchase such Non-Contingent Capital Commitment Interests
by providing the Withdrawn Partner with a promissory note in the amount
determined in (i) above. Such promissory note shall have a maximum term of ten
(10) years with interest at the Federal Funds Rate.

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

(i) 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 estate or guardian, as
the case may be, prior to engaging such professionals. If the Withdrawn Partner
(or his 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.

 

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(j) Each Limited Partner hereby irrevocably appoints each General Partner as
such Limited Partner’s true and lawful agent, representative and
attorney-in-fact, each acting alone, in such Limited Partner’s name, place and
stead, to make, execute, sign and file, on behalf of such Limited Partner, any
and all agreements, instruments, documents and certificates which such General
Partner deems necessary or advisable in connection with any transaction or
matter contemplated by or provided for in this Section 8.1, including, without
limitation, the performance of any obligation of such Limited Partner or the
Partnership or the exercise of any right of such Limited 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 Limited Partner for any reason and shall not be
affected by the death, disability or incapacity of such Limited Partner.

Section 8.2. Transfer of Limited Partner’s Capital Commitment Interest. Except
as otherwise agreed by the General Partner, no Limited Partner or former Limited
Partner shall have the right to sell, assign, mortgage, pledge or otherwise
dispose of or transfer (“Transfer”) all or part of any such Partner’s Capital
Commitment Partner Interest in the Partnership; provided, that this Section 8.2
shall in no way impair Transfers (i) as permitted in Section 8.1 above, in the
case of the purchase of a Withdrawn Partner’s or deceased or Totally Disabled
Limited Partner’s Capital Commitment Interests, (ii) Transfers by a Limited
Partner to another Limited Partner of Non-Contingent Capital Commitment
Interests, (iii) Transfers of up to 25% of a Limited Partner’s Capital
Commitment Partner Interest to an Estate Planning Vehicle and (iv) with the
prior written consent of the General Partner, which consent may be withheld
without giving any reason therefor. No person acquiring an interest in the
Partnership pursuant to this Section 8.2 shall become a Limited Partner of the
Partnership, or acquire such Partner’s right to participate in the affairs of
the Partnership, unless such person shall be admitted as a Limited Partner
pursuant to Section 6.1. A Limited Partner shall not cease to be a limited
partner of the Partnership upon the collateral assignment of, or the pledging or
granting of a security interest in, its entire limited partner interest in the
Partnership in accordance with the provisions of this Agreement.

Section 8.3. Compliance with Law. Notwithstanding any provision hereof to the
contrary, no sale or Transfer of a Capital Commitment Interest in the
Partnership may be made except in compliance with all U.S. Federal, state and
other applicable laws, including U.S. Federal and state securities laws.

ARTICLE IX

DISSOLUTION

Section 9.1. Dissolution.

(a) The Partnership shall be dissolved and subsequently terminated:

(i) pursuant to Section 6.6;

(ii) upon the expiration of the Term; or

(iii) upon the occurrence of a Disabling Event with respect to a General Partner
or any other event causing a dissolution of the Partnership under the
Partnership Act, provided that the Partnership will not be dissolved or required
to be wound up in connection with a Disabling Event with respect to a General
Partner, if: (i) at the time of the occurrence of such event there is at least
one other general partner of the Partnership who is hereby authorized to,

 

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and elects to, carry on the business of the Partnership; or (ii) all remaining
Partners consent to the continuation of the business of the Partnership within
90 days following the occurrence of any such event, which consent will not be
withheld by any Limited Partner if a Majority of the Remaining Partners agree in
writing to so continue the business of the Partnership. A “Majority of Remaining
Partners” means remaining Partners who, as of the date of such consent, have
aggregate capital account balances representing at least a majority in amount of
the total GP-Related Capital Account balances of all the remaining Partners.

Section 9.2. Final Distribution.

(a) Within 120 calendar days after the effective date of dissolution of the
Partnership, the assets of the Partnership shall be distributed in the following
manner and order:

(i) to the payment of the expenses of the winding-up, liquidation and
dissolution of the Partnership;

(ii) to pay all creditors of the Partnership, other than Partners, either by the
payment thereof or the making of reasonable provision therefor;

(iii) to establish reserves, in amounts established by the General Partner or
the liquidator, to meet other liabilities of the Partnership; and

(iv) to pay, in accordance with the terms agreed among them and otherwise on a
pro rata basis, all creditors of the Partnership that are Partners, either by
the payment thereof or the making of reasonable provision therefor.

(b) The remaining assets of the Partnership shall be applied and distributed
among the Partners as follows:

(i) With respect to each Partner’s GP-Related Partner Interest, the remaining
assets of the Partnership shall be applied and distributed to such Partner in
accordance with the procedures set forth in Section 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; and for purposes
of the application of this Section 9.2(b)(i), determining GP-Related Capital
Accounts on liquidation, all unrealized gains, losses and accrued income and
deductions of the Partnership shall be treated as realized and recognized
immediately before the date of distribution; and

(ii) With respect to each Partner’s Capital Commitment Partner Interest, an
amount shall be paid to such Partner in cash or Securities in an amount equal to
such Partner’s respective Capital Commitment Liquidating Share for each Capital
Commitment Investment; provided, that if the remaining assets relating to any
Capital Commitment Investment shall not be equal to or exceed the aggregate
Capital Commitment Liquidating Shares for such Capital Commitment Investment, to
each Partner in proportion to its Capital Commitment Liquidating Share for such
Capital Commitment Investment; and the remaining assets of the Partnership
related to the Partners’ Capital Commitment Partner Interests shall be paid to
the Partners in cash or Securities in proportion to their respective Capital
Commitment Profit Sharing Percentages for each Capital Commitment Investment
from which such cash or Securities are derived.

 

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Section 9.3. Amounts Reserved Related to Capital Commitment Partner Interests.

(a) If there are any Securities or other property or other investments or
securities related to the Partners’ Capital Commitment Partner Interests which,
in the judgment of the liquidator, cannot be sold, or properly distributed in
kind in the case of dissolution, without sacrificing a significant portion of
the value thereof, the value of a Partner’s interest in each such Security or
other investment or security may be excluded from the amount distributed to the
Partners participating in the related Capital Commitment Investment pursuant to
clause (ii) of Section 9.2(b). Any interest of a Partner, including his pro rata
interest in any gains, losses or distributions, in Securities or other property
or other investments or securities so excluded shall not be paid or distributed
until such time as the liquidator shall determine.

(b) If there is any pending transaction, contingent liability or claim by or
against the Partnership related to the Partners’ Capital Commitment Partner
Interests as to which the interest or obligation of any Partner therein cannot,
in the judgment of the liquidator, be then ascertained, the value thereof or
probable loss therefrom may be deducted from the amount distributable to such
Partner pursuant to clause (ii) of Section 9.2(b). No amount shall be paid or
charged to any such Partner on account of any such transaction or claim until
its final settlement or such earlier time as the liquidator shall determine. The
Partnership may meanwhile retain from other sums due such Partner in respect of
such Partner’s Capital Commitment Partner Interest an amount which the
liquidator estimates to be sufficient to cover the share of such Partner in any
probable loss or liability on account of such transaction or claim.

(c) Upon determination by the liquidator that circumstances no longer require
the exclusion of any Securities or other property or retention of sums as
provided in paragraphs (a) and (b) of this Section 9.3, the liquidator shall, at
the earliest practicable time, distribute as provided in clause (ii) of
Section 9.2(b) such sums or such Securities or other property or the proceeds
realized from the sale of such Securities or other property to each Partner from
whom such sums or Securities or other property were withheld.

ARTICLE X

MISCELLANEOUS

Section 10.1. 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) 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 thirty
(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

 

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(i) expressly consents to the application of paragraph (c) of this Section 10.1
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 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 (B) OF THIS SECTION 10.1, 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 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 10.1 and
such parties agree not to plead or claim the same.

(d) Notwithstanding any provision of this Agreement to the contrary, this
Section 10.1 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 10.1, 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 10.1. In that case, this Section 10.1 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 10.1 shall be construed to omit such invalid or unenforceable
provision.

Section 10.2. Ownership and Use of the Firm 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.

 

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Section 10.3. 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 10.4. Letter Agreements; Schedules. The General Partner may, or may
cause the Partnership to, enter or has previously entered, into separate letter
agreements with individual Partners with respect to GP-Related Profit Sharing
Percentages, Capital Commitment Profit Sharing Percentages or any other matter,
in each case on terms and conditions not inconsistent with this Agreement;
provided, that, notwithstanding the foregoing, any terms of this Agreement may
be made subject to any such letter agreements to the extent provided elsewhere
herein. If required by applicable law, such separate letter agreements, or any
provision thereof or information contained therein, shall be filed, or disclosed
in a Certificate filed, in accordance with the Partnership Act. The General
Partner may from time to time execute and deliver to the Partners Schedules
which set forth the then current capital balances, GP-Related Profit Sharing
Percentages and Capital Commitment 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 10.5. Governing Law. Except as expressly provided in Section 10.1, this
Agreement shall be governed by and construed in accordance with the laws of the
Province of Alberta, Canada, without regard to conflicts of law principles. In
particular, the Partnership is formed pursuant to the Partnership Act, and the
mutual rights, duties and liabilities of the General Partners and Limited
Partners (including the Special Limited 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 10.6. Successors and Assigns; Third Party Beneficiaries. This Agreement
shall be binding upon and shall, subject to the penultimate sentence of
Section 6.3(a), 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 Articles VI and VIII. Any Partner
or Withdrawn Partner shall remain liable for the obligations under this
Agreement (including any Net GP-Related Recontribution Amounts and any Capital
Commitment Recontribution Amounts) 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. The Partnership shall, if the General Partner
determines, in its good faith judgment, based on the standards set forth in
Sections 5.8(d)(ii)(A) and 7.4(g)(ii)(A), to pursue such transferee, pursue
payment (including any Net GP-Related Recontribution Amounts and/or any Capital
Commitment Recontribution Amounts) from the transferee with respect to any such
obligations. Nothing in this Agreement is intended, nor shall anything herein be
construed, to confer any rights, legal or equitable, on any person other than
the Partners and their respective legal representatives, heirs, successors and
permitted assigns. Notwithstanding the foregoing, solely to the extent required
by the BSSF Europe Agreements, (x) the limited partners in BSSF Europe shall be
third-party beneficiaries of the provisions of Sections 5.8(d)(i)(A) and
5.8(d)(ii)(A) (and the definitions relating thereto), solely as they relate to
any Clawback Amount (for purpose of this

 

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sentence, as defined in paragraph 9.2.7(b) of the BSSF Europe Agreements), and
(y) the amendment of the provisions of Sections 5.8(d)(i)(A) and 5.8(d)(ii)(A)
(and the definitions relating thereto), solely as they relate to any Clawback
Amount (for purpose of this sentence, as defined in paragraph 9.2.7(b) of the
BSSF Europe Agreements), shall be effective against such limited partners only
with the Combined Limited Partner Consent (as such term is used in the BSSF
Europe Agreements).

Section 10.7. Partner’s Will. Each Special Limited 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 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 Partner’s or Withdrawn Partner’s 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 10.7 after the Partnership has notified such
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 Partner or Withdrawn Partner until
the time at which such party complies with the requirements of this
Section 10.7.

Section 10.8. Confidentiality. 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 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, however, that any corporate Partner may disclose any
such information it is required by law, rule, regulation or custom to disclose.
Notwithstanding anything in this Agreement to the contrary, to comply with
Treasury Regulation 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
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.

Section 10.9. Notices. Whenever notice is required or permitted by this
Agreement to be given, such notice shall be in writing (including telecopy or
similar writing) and shall be given by hand delivery (including any courier
service) or telecopy to any Partner at its address or telecopy number shown in
the Partnership’s books and records or, if given to the General Partner or the
Partnership, at the address or telecopy number of the Partnership in New York
City. Each such notice shall be effective (i) if given by telecopy, upon
dispatch, and (ii) if given by hand delivery, when delivered to the address of
such Partner or the General Partner or the Partnership specified as aforesaid.

Section 10.10. Counterparts. This Agreement may be executed in any number of
counterparts, all of which together shall constitute a single instrument.

 

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Section 10.11. Power of Attorney. Each Partner hereby irrevocably appoints the
General Partner as such Partner’s true and lawful representative and
attorney-in-fact, acting alone, in such Partner’s name, place and stead, to
make, execute, sign and file all instruments, documents and certificates which,
from time to time, may be required to set forth any amendment to this Agreement
or may be required by this Agreement or by the laws of Canada, the Province of
Alberta or any other jurisdiction in which the Partnership shall determine to do
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 subsequent Withdrawal from the Partnership
of any Partner for any reason and shall not be affected by the disability or
incapacity of such Partner.

Section 10.12. 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 10.13. 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 party seeking to enforce Section 4.1(d) or any other
provision of this Agreement relating to the Holdback, the Clawback Amount, the
GP-Related Giveback Amount , the Capital Commitment Giveback Amount, the Net
GP-Related Recontribution Amount or the Capital Commitment Recontribution
Amount, 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 10.13 shall be paid within 30
days of the date upon which such amounts are due to be paid and such amounts
remaining unpaid after such date shall accrue interest at the Default Rate.

Section 10.14. 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 10.4, 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 PARTNERS: BLACKSTONE REAL ESTATE SPECIAL SITUATIONS EUROPE (CAYMAN) LTD.
By:    /s/ Robert L. Friedman   Name: Robert L. Friedman   Title: Director
BLACKSTONE REAL ESTATE SPECIAL SITUATIONS EUROPE GP L.P. By: Blackstone Real
Estate Special Situations Europe GP L.L.C., its general partner By:   /s/ Robert
L. Friedman   Name: Robert L. Friedman   Title: Chief Legal Officer

 

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LIMITED PARTNERS: All Limited Partners now and hereafter admitted pursuant to
powers of attorney now and hereafter granted to Blackstone Real Estate Special
Situations Europe GP L.P.

By: BLACKSTONE REAL ESTATE SPECIAL SITUATIONS EUROPE GP L.P.,

As Attorney-in-Fact

By: Blackstone Real Estate Special Situations Europe GP L.L.C., its general
partner By:    /s/ Robert L. Friedman   Name: Robert L. Friedman   Title: Chief
Legal Officer

 

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/s/ Christopher J. James Christopher J. James, as Initial Limited Partner, to
reflect his withdrawal from the Partnership

 

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