Execution Copy
SECOND AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
GENESIS ENERGY, L.P.
TABLE OF CONTENTS
Page
ARTICLE I
Definitions
1.1 Definitions 1
1.2 Construction 11
ARTICLE II
Organization
2.1 Continuation of Existence 11
2.2 Name 11
2.3 Registered Office; Registered Agent; Principal Office;
Other Offices 11
2.4 Purpose and Business 11
2.5 Powers 12
2.6 Power of Attorney 12
2.7 Term 13
2.8 Title to Partnership Assets 13
ARTICLE III
` Rights of Limited Partners
3.1 Limitation of Liability 13
3.2 Management of Business 14
3.3 Outside Activities of the Limited Partners 14
3.4 Rights of Limited Partners 14
ARTICLE IV
Certificates; Record Holders; Transfer of Partnership
Interests; Redemption of Partnership Interests
4.1 Certificates 15
4.2 Mutilated, Destroyed, Lost or Stolen Certificates 15
4.3 Record Holders 16
4.4 Transfer Generally 16
4.5 Registration and Transfer of Limited Partner Interests 16
4.6 Transfer of a General Partner's General Partner Interest 17
4.7 Restrictions on Transfers 17
4.8 Citizenship Certificates; Non-citizen Assignees 18
4.9 Redemption of Partnership Interests of Non-citizen Assignees 18
ARTICLE V
Capital Contributions and Issuance of Partnership Interests
5.1 Previous Capital Contributions 19
5.2 Additional Contributions by General Partner 19
5.3 Interest and Withdrawal 20
5.4 Capital Accounts 20
5.5 Issuances of Additional Partnership Securities 22
5.6 Limited Preemptive Right 22
5.7 Splits and Combination 23
5.8 Fully Paid and Non-Assessable Nature of Limited Partner Interests 23
ARTICLE VI
Allocations and Distributions
6.1 Allocations for Capital Account Purposes 23
6.2 Allocations for Tax Purposes 26
6.3 Distributions to Record Holders 27
ARTICLE VII
Management and Operation of Business
7.1 Management 28
7.2 Certificate of Limited Partnership 30
7.3 Restrictions on General Partner's Authority 30
7.4 Reimbursement of the General Partner 30
7.5 Outside Activities 31
7.6 Loans from the General Partner; Loans or Contributions
from the Partnership; Contracts with Affiliates;
Certain Restrictions on the General Partner 32
7.7 Indemnification 33
7.8 Liability of Indemnitees 34
7.9 Resolution of Conflicts of Interest 35
7.10 Other Matters Concerning the General Partner 36
7.11 Purchase or Sale of Partnership Securities 36
7.12 Registration Rights of the General Partner and its Affiliates 37
7.13 Reliance by Third Parties 38
ARTICLE VIII
Books, Records, Accounting and Reports
8.1 Records and Accounting 39
8.2 Fiscal Year 39
8.3 Reports 39
ARTICLE IX
Tax Matters
9.1 Tax Returns and Information 39
9.2 Tax Elections 39
9.3 Tax Controversies 40
9.4 Withholding 40
ARTICLE X
Admission of Partners
10.1 Admission of Substituted Limited Partner 40
10.2 Admission of Successor General Partner 41
10.3 Admission of Additional Limited Partners 41
10.4 Amendment of Agreement and Certificate of Limited Partnership 41
ARTICLE XI
Withdrawal or Removal of Partners
11.1 Withdrawal of the General Partner 41
11.2 Removal of the General Partner 43
11.3 Interest of Departing Partner and Successor General Partner 43
11.4 Withdrawal of Limited Partners 44
ARTICLE XII
Dissolution and Liquidation
12.1 Dissolution 44
12.2 Continuation of the Business of the Partnership After Dissolution 45
12.3 Liquidator 45
12.4 Liquidation 46
12.5 Cancellation of Certificate of Limited Partnership 46
12.6 Return of Contributions 46
12.7 Waiver of Partition 46
12.8 Capital Account Restoration 46
ARTICLE XIII
Amendment of Partnership Agreement; Meetings; Record Date
13.1 Amendment to be Adopted Solely by the General Partner 47
13.2 Amendment Procedures 48
13.3 Amendment Requirements 48
13.4 Special Meetings 49
13.5 Notice of a Meeting 49
13.6 Record Date 49
13.7 Adjournment 49
13.8 Waiver of Notice; Approval of Meeting; Approval of Minutes 49
13.9 Quorum 50
13.10 Conduct of a Meeting 50
13.11 Action Without a Meeting 50
13.12 Voting and Other Rights 51
ARTICLE XIV
Merger
14.1 Authority 51
14.2 Procedure for Merger or Consolidation 51
14.3 Approval by Limited Partners of Merger or Consolidation 52
14.4 Certificate of Merger 53
14.5 Effect of Merger 53
ARTICLE XV
Right to Acquire Limited Partner Interests
15.1 Right to Acquire Limited Partner Interests 53
ARTICLE XVI
General Provisions
16.1 Addresses and Notices 55
16.2 Further Action 55
16.3 Binding Effect 55
16.4 Integration 55
16.5 Creditors 55
16.6 Waiver 56
16.7 Counterparts 56
16.8 Applicable Law 56
16.9 Invalidity of Provisions 56
16.10 Consent of Partners 56
SECOND AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
OF
GENESIS ENERGY, L.P.
THIS SECOND AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP of Genesis Energy, L.P. dated as of December 7, 2000,
is entered into by and among Genesis Energy, L.L.C., a Delaware
limited liability company, as the General Partner, together with
any other Persons who are or who become Partners in the
Partnership or parties hereto as provided herein. In
consideration of the covenants, conditions and agreements
contained herein, the parties hereto hereby agree as follows:
WHEREAS, the General Partner and certain other
parties organized the Partnership as a Delaware limited
partnership pursuant to an Amended and Restated
Agreement of Limited Partnership dated as of December
3, 1996 (the "Previous Agreement"); and
WHEREAS, the partners of the Partnership and
Genesis OLP have approved by requisite vote a
restructuring (the "Restructuring") of the Partnership
and Genesis OLP pursuant to which (a) all outstanding
Subordinated LP Units and APIs (each as defined in the
Genesis OLP Partnership Agreement) will be eliminated,
(b) the Previous Agreement and the previous Genesis OLP
Partnership Agreement will be amended to, among other
things, reduce the Minimum Quarterly Distribution, the
First Target Distribution, the Second Target
Distribution and the Third Target Distribution (each as
defined in the Genesis OLP Partnership Agreement) and
provide that the Common Units (as defined in the
Genesis OLP Partnership Agreement) will not accrue
arrearages if the Minimum Quarterly Distribution is not
paid in full in any Quarter, (c) Salomon will
contribute to Genesis OLP the remaining $3,802,000 of
its distribution support obligation under the
Distribution Support Agreement (the "Remaining
Distribution Support"), (d) Genesis OLP will make a
special distribution of the Remaining Distribution
Support less the cost associated with the restructuring
to the Partnership and the Partnership will make a
special distribution of such amount to the holders of
Common Units, (e) the Distribution Support Agreement
will be terminated, (f) the Partnership will withdraw
as a general partner of Genesis OLP and the
Partnership's 80.01% general partner interest in
Genesis OLP represented by 8,801,020 Subordinated GP
Units will be converted into a 99.99% limited partner
interest, (g) the General Partner's 0.40% general
partner interest in Genesis OLP represented by 43,980
Subordinated GP Units will be converted into a 0.01%
general partner interest and (h) Salomon's $300 million
credit support obligation under the Master Credit
Support Agreement will be extended until December 31,
2001 on the current terms and conditions; and
WHEREAS, Genesis Energy, L.L.C., as the sole
general partner, now desires to amend and restate the
Previous Agreement to reflect the Restructuring and
such other changes that, in the discretion of Genesis
Energy, L.L.C., do not adversely affect the Limited
Partners in any material respect;
NOW, THEREFORE, in consideration of the premises
and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the
parties hereto hereby amend and restate the Previous
Agreement in its entirety:
ARTICLE I
Definitions
1.1 Definitions
The following definitions shall be for all purposes, unless
otherwise clearly indicated to the contrary, applied to the terms
used in this Agreement.
"Acquisition" means any transaction in which any Group
Member acquires (through an asset acquisition, merger, stock
acquisition or other form of investment) control over all or a
portion of the assets, properties or business of another Person
for the purpose of increasing the operating capacity or revenues
of the Partnership Group from the operating capacity or revenues
of the Partnership Group existing immediately prior to such
transaction.
"Additional Limited Partner" means a Person admitted to the
Partnership as a Limited Partner pursuant to Section 10.4 and who
is shown as such on the books and records of the Partnership.
"Adjusted Capital Account" means the Capital Account
maintained for each Partner as of the end of each fiscal year of
the Partnership, (a) increased by any amounts that such Partner
is obligated to restore under the standards set by Treasury
Regulation Section 1.704-1(b)(2)(ii)(c) (or is deemed obligated
to restore under Treasury Regulation Sections 1.704-2(g) and
1.704-2(i)(5)) and (b) decreased by (i) the amount of all losses
and deductions that, as of the end of such fiscal year, are
reasonably expected to be allocated to such Partner in subsequent
years under Sections 704(e)(2) and 706(d) of the Code and
Treasury Regulation Section 1.751-1(b)(2)(ii), and (ii) the
amount of all distributions that, as of the end of such fiscal
year, are reasonably expected to be made to such Partner in
subsequent years in accordance with the terms of this Agreement
or otherwise to the extent they exceed offsetting increases to
such Partner's Capital Account that are reasonably expected to
occur during (or prior to) the year in which such distributions
are reasonably expected to be made (other than increases as a
result of a minimum gain chargeback pursuant to Section 6.1(c)(i)
or 6.1(c)(ii)). The foregoing definition of Adjusted Capital
Account is intended to comply with the provisions of Treasury
Regulation Section 1.704- 1(b)(2)(ii)(d) and shall be interpreted
consistently therewith.
"Adjusted Property" means any property the Carrying Value of
which has been adjusted pursuant to Section 5.4(d)(i) or
5.4(d)(ii).
"Affiliate" means, with respect to any Person, any other
Person that (i) directly or indirectly through one or more
intermediaries controls, is controlled by or is under common
control with, the Person in question or (ii) owns, beneficially,
directly or indirectly, 20% or more of the outstanding capital
stock, shares or other equity interests of the Person in
question. As used herein, the term "control" means the
possession, direct or indirect, of the power to direct or cause
the direction of the management and policies of a Person, whether
through ownership of voting securities, by contract or otherwise.
"Agreed Allocation" means any allocation, other than a
Required Allocation, of an item of income, gain, loss or
deduction pursuant to the provisions of Section 6.1, including,
without limitation, a Curative Allocation (if appropriate to the
context in which the term "Agreed Allocation" is used).
"Agreed Value" of any Contributed Property means the fair
market value of such property or other consideration at the time
of contribution as determined by the General Partner using such
reasonable method of valuation as it may adopt. The General
Partner shall, in its discretion, use such method as it deems
reasonable and appropriate to allocate the aggregate Agreed Value
of Contributed Properties contributed to the Partnership in a
single or integrated transaction among each separate property on
a basis proportional to the fair market value of each Contributed
Property.
"Agreement" means this Second Amended and Restated Agreement
of Limited Partnership of Genesis Energy, L.P., as it may be
amended, supplemented or restated from time to time.
"API" has the meaning assigned to such term in the Genesis
OLP Partnership Agreement.
"Assignee" means a Non-citizen Assignee or a Person to whom
one or more Limited Partner Interests have been transferred in a
manner permitted under this Agreement and who has executed and
delivered a Transfer Application as required by this Agreement,
but who has not been admitted as a Substituted Limited Partner.
"Associate" means, when used to indicate a relationship with
any Person, (a) any corporation or organization of which such
Person is a director, officer or partner or is, directly or
indirectly, the owner of 20% or more of any class of voting stock
or other voting interest; (b) any trust or other estate in which
such Person has at least a 20% beneficial interest or as to which
such Person serves as trustee or in a similar fiduciary capacity;
and (c) any relative or spouse of such Person, or any relative of
such spouse, who has the same principal residence as such Person.
"Audit Committee" means a committee of the Board of
Directors of the General Partner composed entirely of two or more
directors who are neither officers nor employees of the General
Partner or officers, directors or employees of any Affiliate of
the General Partner.
"Available Cash" means, with respect to any Quarter ending
prior to the Liquidation Date,
(a) the sum of (i) all cash and cash equivalents of the
Partnership on hand at the end of such Quarter and (ii) all
additional cash and cash equivalents of the Partnership on
hand on the date of determination of Available Cash with
respect to such Quarter resulting from borrowings for
working capital purposes, less
(b) the amount of any cash reserves that is necessary
or appropriate in the reasonable discretion of the General
Partner to (i) provide for the proper conduct of the
business of the Partnership Group (including reserves for
future capital expenditures and for anticipated future
credit needs of the business of the Partnership Group)
subsequent to such Quarter or (ii) comply with applicable
law or any loan agreement (including the Master Credit
Support Agreement), security agreement (including the
Security Agreement), mortgage, debt instrument or other
agreement or obligation to which any Group Member is a party
or by which it is bound or its assets are subject; provided,
however, that disbursements made by the Partnership or cash
reserves established, increased or reduced after the end of
such Quarter but on or before the date of determination of
Available Cash with respect to such Quarter shall be deemed
to have been made, established, increased or reduced, for
purposes of determining Available Cash, within such Quarter
if the General Partner so determines.
Notwithstanding the foregoing, "Available Cash" with
respect to the Quarter in which the Liquidation Date occurs
and any subsequent Quarter shall equal zero.
"Book-Tax Disparity" means, with respect to any item of
Contributed Property or Adjusted Property, as of the date of any
determination, the difference between the Carrying Value of such
Contributed Property or Adjusted Property and the adjusted basis
thereof for federal income tax purposes as of such date. A
Partner's share of the Partnership's Book-Tax Disparities in all
of its Contributed Property and Adjusted Property will be
reflected by the difference between such Partner's Capital
Account balance as maintained pursuant to Section 5.4 and the
hypothetical balance of such Partner's Capital Account computed
as if it had been maintained strictly in accordance with federal
income tax accounting principles.
"Business Day" means Monday through Friday of each week,
except that a legal holiday recognized as such by the government
of the United States of America or the states of New York or
Texas shall not be regarded as a Business Day.
"Capital Account" means the capital account maintained for a
Partner pursuant to Section 5.4.
"Capital Contribution" means any cash, cash equivalents or
the Net Agreed Value of Contributed Property that a Partner
contributed to the Partnership pursuant to this Agreement (or the
Previous Agreement).
"Capital Improvement" means any (a) addition or improvement
to the capital assets owned by any Group Member or (b)
acquisition of existing or the construction of new capital assets
(including pipeline systems, storage facilities and related
assets), made to increase the operating capacity or revenues of
the Partnership Group from the operating capacity or revenues of
the Partnership Group existing immediately prior to such
addition, improvement, acquisition or construction.
"Carrying Value" means (a) with respect to a Contributed
Property, the Agreed Value of such property reduced (but not
below zero) by all depreciation, amortization and cost recovery
deductions charged to the Partners' and Assignees' Capital
Accounts in respect of such Contributed Property, and (b) with
respect to any other Partnership property, the adjusted basis of
such property for federal income tax purposes, all as of the time
of determination. The Carrying Value of any property shall be
adjusted from time to time in accordance with Sections 5.4(d)(i)
and 5.4(d)(ii) and to reflect changes, additions or other
adjustments to the Carrying Value for dispositions and
acquisitions of Partnership properties, as deemed appropriate by
the General Partner.
"Cause" means a court of competent jurisdiction has entered
a final, non- appealable judgment finding the General Partner
liable for actual fraud, gross negligence or willful or wanton
misconduct in its capacity as general partner of the Partnership.
"Certificate" means a certificate, (i) substantially in the
form of Exhibit A to this Agreement, (ii) issued in global form
in accordance with the rules of the Depositary or (iii) in such
other form as may be adopted by the General Partner in its
discretion, issued by the Partnership evidencing ownership of one
or more Common Units or a certificate, in such form as may be
adopted by the General Partner in its discretion, issued by the
Partnership evidencing ownership of one or more other Partnership
Securities.
"Certificate of Limited Partnership" means the Amended and
Restated Certificate of Limited Partnership of the Partnership
filed with the Secretary of State of the State of Delaware as
referenced in Section 7.2, as such Certificate of Limited
Partnership may be amended, supplemented or restated from time to
time.
"Citizenship Certification" means a properly completed
certificate in such form as may be specified by the General
Partner by which an Assignee or a Limited Partner certifies that
he (and if he is a nominee holding for the account of another
Person, that to the best of his knowledge such other Person) is
an Eligible Citizen.
"claim" has the meaning assigned to such term in Section
7.12(c).
"Closing Price" has the meaning assigned to such term in
Section 15.1(a).
"Code" means the Internal Revenue Code of 1986, as amended
and in effect from time to time. Any reference herein to a
specific section or sections of the Code shall be deemed to
include a reference to any corresponding provision of future law.
"Combined Interest" has the meaning assigned to such term in
Section 11.3(a).
"Commission" means the United States Securities and Exchange
Commission.
"Common Unit" means a Partnership Security representing a
fractional part of the Partnership Interests of all Limited
Partners and Assignees and having the rights and obligations
specified with respect to a Common Unit in this Agreement.
"Contributed Property" means each property or other asset,
in such form as may be permitted by the Delaware Act, but
excluding cash, contributed to the Partnership. Once the
Carrying Value of a Contributed Property is adjusted pursuant to
Section 5.4(d), such property shall no longer constitute a
Contributed Property, but shall be deemed an Adjusted Property.
"Conversion Election" has the meaning assigned to such term
in the Genesis OLP Partnership Agreement.
"Conveyance Agreement" means that certain Purchase & Sale
and Contribution & Conveyance Agreement, dated as of November 26,
1996, among the Partnership, Genesis OLP, Genesis Energy, L.L.C.,
Xxxxxx and a Subsidiary of Salomon, together with the additional
conveyance documents and instruments contemplated or referenced
thereunder.
"Curative Allocation" means any allocation of an item of
income, gain, deduction, loss or credit pursuant to the
provisions of Section 6.1(c)(ix).
"Current Market Price" has the meaning assigned to such term
in Section 15.1(a).
"Delaware Act" means the Delaware Revised Uniform Limited
Partnership Act, 6 Del C. 17-101, et seq., as amended,
supplemented or restated from time to time, and any successor to
such statute.
"Departing Partner" means a former General Partner from and
after the effective date of any withdrawal or removal of such
former General Partner pursuant to Section 11.1 or 11.2.
"Depositary" means, with respect to any Units issued in
global form, The Depository Trust Company and its successors and
permitted assigns.
"Distribution Support Agreement" means the Distribution
Support Agreement, dated as of December 3, 1996, between the
Genesis OLP and Salomon, which sets forth the agreement of the
Partnership and Salomon relating to the purchase of APIs.
"Economic Risk of Loss" has the meaning set forth in
Treasury Regulation Section 1.752-2(a).
"Eligible Citizen" means a Person qualified to own interests
in real property in jurisdictions in which any Group Member does
business or proposes to do business from time to time, and whose
status as a Limited Partner or Assignee does not or would not
subject such Group Member to a significant risk of cancellation
or forfeiture of any of its properties or any interest therein.
"Event of Withdrawal" has the meaning assigned to such term
in Section 11.1(a).
"GP Unit" means a Partnership Security representing a
fractional part of the Partnership Interest of the General
Partner and having the rights and obligations specified with
respect to GP Units in this Agreement.
"General Partner" means Genesis Energy, L.L.C. and its
successors and permitted assigns as general partner of the
Partnership.
"General Partner Interest" means the ownership interest of
the General Partner in the Partnership (in its capacity as a
general partner without reference to any Limited Partner Interest
held by it), which may be evidenced by GP Units or other
Partnership Securities or a combination thereof or interest
therein, and includes any and all benefits to which the General
Partner is entitled as provided in this Agreement, together with
all obligations of the General Partner to comply with the terms
and provisions of this Agreement.
"Genesis OLP" means Genesis Crude Oil, L.P., a Delaware
limited partnership, and its successors.
"Genesis OLP Partnership Agreement" means the Second Amended
and Restated Agreement of Limited Partnership of Genesis Crude
Oil, L.P., as it may be amended, supplemented or restated from
time to time.
"Group" means a Person that with or through any of its
Affiliates or Associates has any agreement, arrangement or
understanding for the purpose of acquiring, holding, voting
(except voting pursuant to a revocable proxy or consent given to
such Person in response to a proxy or consent solicitation made
to 10 or more Persons) or disposing of any Partnership Securities
with any other Person that beneficially owns, or whose Affiliates
or Associates beneficially own, directly or indirectly,
Partnership Securities.
"Group Member" means a member of the Partnership Group.
"Holder" as used in Section 7.12, has the meaning assigned
to such term in Section 7.12(a).
"Xxxxxx" means Xxxxxx Corporation and its Subsidiaries.
"Incentive Compensation Payment" has the meaning assigned to
such term in the Genesis OLP Partnership Agreement.
"Indemnified Persons" has the meaning assigned to such term
in Section 7.12(c).
"Indemnitee" means (a) the General Partner, any Departing
Partner and any Person who is or was an Affiliate of the General
Partner or any Departing Partner, (b) any Person who is or was a
director, officer, employee, agent or trustee of a Group Member,
(c) any Person who is or was a member, officer, director,
employee, agent or trustee of the General Partner or any
Departing Partner or any Affiliate of the General Partner or any
Departing Partner, or any Affiliate of any such Person, and (d)
any Person who is or was serving at the request of the General
Partner or any Departing Partner or any such Affiliate as a
director, officer, employee, member, partner, agent, fiduciary or
trustee of another Person; provided, that a Person shall not be
an Indemnitee by reason of providing, on a fee-for-services
basis, trustee, fiduciary or custodial services.
"Initial Closing Date" means December 3, 1996.
"Initial Offering" means the initial offering and sale of
Common Units to the public on December 3, 1996, as described in
the Registration Statement.
"Limited Partner" means, unless the context otherwise
requires, (a) each Initial Limited Partner, each Substituted
Limited Partner, each Additional Limited Partner, and any Partner
upon the change of its status from General Partner to Limited
Partner pursuant to Section 11.3 and (b) solely for purposes of
Articles V, VI, VII and IX and Section 12.4, each Assignee.
"Limited Partner Interest" means the ownership interest of a
Limited Partner or Assignee in the Partnership, which may be
evidenced by Common Units or other Partnership Securities or a
combination thereof or interest therein, and includes any and all
benefits to which such Limited Partner or Assignee is entitled as
provided in this Agreement, together with all obligations of such
Limited Partner or Assignee to comply with the terms and
provisions of this Agreement.
"Liquidation Date" means (a) in the case of an event giving
rise to the dissolution of the Partnership of the type described
in clauses (a) and (b) of the first sentence of Section 12.2, the
date on which the applicable time period during which the
Partners have the right to elect to reconstitute the Partnership
and continue its business has expired without such an election
being made, and (b) in the case of any other event giving rise to
the dissolution of the Partnership, the date on which such event
occurs.
"Liquidator" means one or more Persons selected by the
General Partner to perform the functions described in Section
12.3 as liquidating trustee of the Partnership within the meaning
of the Delaware Act.
"Master Credit Support Agreement" means the Master Credit
Support Agreement, dated as of December 3, 1996, as amended,
between Genesis OLP and Salomon which sets forth the agreement of
Genesis OLP and Salomon relating to the credit support to be
provided by Salomon to Genesis OLP.
"Majority Interest" means at least a majority in Voting
Power of the Outstanding Limited Partner Interests.
"Merger Agreement" has the meaning assigned to such term in
Section 14.1.
"National Securities Exchange" means an exchange registered
with the Commission under Section 6(a) of the Securities Exchange
Act of 1934, as amended, supplemented or restated from time to
time, and any successor to such statute, or the Nasdaq Stock
Market or any successor thereto.
"Net Agreed Value" means, (a) in the case of any Contributed
Property, the Agreed Value of such property reduced by any
liabilities either assumed by the Partnership upon such
contribution or to which such property is subject when
contributed, and (b) in the case of any property distributed to a
Partner or Assignee by the Partnership, the Partnership's
Carrying Value of such property (as adjusted pursuant to Section
5.4(d)(ii)) at the time such property is distributed, reduced by
any indebtedness either assumed by such Partner or Assignee upon
such distribution or to which such property is subject at the
time of distribution, in either case, as determined under Section
752 of the Code.
"Net Income" means, for any taxable year, the excess, if
any, of the Partnership's items of income and gain for such
taxable year over the Partnership's items of loss and deduction
for such taxable year. The items included in the calculation of
Net Income shall be determined in accordance with Section 5.4(b)
and shall not include any items specially allocated under Section
6.1(c).
"Net Loss" means, for any taxable year, the excess, if any,
of the Partnership's items of loss and deduction for such taxable
year over the Partnership's items of income and gain for such
taxable year. The items included in the calculation of Net Loss
shall be determined in accordance with Section 5.4(b) and shall
not include any items specially allocated under Section 6.1(c).
"Ninety Percent Interest" means at least 90% in Voting Power
of the Outstanding Limited Partner Interests.
"Non-Competition Agreement" means the Non-Competition
Agreement, dated as of December 3, 1996, among the Partnership,
Genesis OLP, Salomon, Basis Petroleum, Inc. and Xxxxxx.
"Non-citizen Assignee" means a Person whom the General
Partner has determined in its discretion does not constitute an
Eligible Citizen and as to whose Limited Partner Interest the
General Partner has become the Substituted Limited Partner,
pursuant to Section 4.8.
"Nonrecourse Built-in Gain" means with respect to any
Contributed Properties or Adjusted Properties that are subject to
a mortgage or pledge securing a Nonrecourse Liability, the amount
of any taxable gain that would be allocated to the Partners
pursuant to Sections 6.2(b)(i)(A), 6.2(b)(ii)(A) and 6.2(b)(iii)
if such properties were disposed of in a taxable transaction in
full satisfaction of such liabilities and for no other
consideration.
"Nonrecourse Deductions" means any and all items of loss,
deduction or expenditures (including, without limitation, any
expenditure described in Section 705(a)(2)(B) of the Code) that,
in accordance with the principles of Treasury Regulation Section
1.704-2(b), are attributable to a Nonrecourse Liability.
"Nonrecourse Liability" has the meaning set forth in
Treasury Regulation Section 1.752-1(a)(2).
"Notice of Election to Purchase" has the meaning assigned to
such term in Section 15.1(b) hereof.
"OLP General Partner Interest" has the meaning assigned to
the term "General Partner Interest" in the Genesis OLP
Partnership Agreement.
"Opinion of Counsel" means a written opinion of counsel (who
may be regular counsel to the Partnership or the General Partner
or any of their Affiliates) acceptable to the General Partner in
its reasonable discretion.
"Outstanding" means, with respect to Partnership Securities,
all Partnership Securities that are issued by the Partnership and
reflected as outstanding on the Partnership's books and records
as of the date of determination; provided, however, that if at
any time any Person or Group (other than the General Partner or
its Affiliates) beneficially owns 20% or more of any Outstanding
Partnership Securities of any class then Outstanding, all
Partnership Securities owned by such Person or Group shall not be
voted on any matter and shall not be considered to be Outstanding
when sending notices of a meeting of Limited Partners to vote on
any matter (unless otherwise required by law), calculating
required votes, determining the presence of a quorum or for other
similar purposes under this Agreement, except that such
Partnership Securities shall be considered to be Outstanding for
purposes of Section 11.1(b)(iv) (such Partnership Securities
shall not, however, be treated as a separate class of Partnership
Securities for purposes of this Agreement).
"Parity Units" means Common Units and all other Limited
Partner Interests having rights to distributions or in
liquidation ranking on a parity with the Common Units.
"Partner" means the General Partner and each Limited
Partner.
"Partner Nonrecourse Debt" has the meaning set forth in
Treasury Regulation Section 1.704-2(b)(4).
"Partner Nonrecourse Debt Minimum Gain" has the meaning set
forth in Treasury Regulation Section 1.704-2(i)(2).
"Partner Nonrecourse Deductions" means any and all items of
loss, deduction or expenditure (including, without limitation,
any expenditure described in Section 705(a)(2)(B) of the Code)
that, in accordance with the principles of Treasury Regulation
Section 1.704-2(i), are attributable to a Partner Nonrecourse
Debt.
"Partnership" means Genesis Energy, L.P., a Delaware limited
partnership, and any successors thereto.
"Partnership Group" means the Partnership, Genesis OLP and
any other Subsidiary of the Partnership, treated as a single
consolidated entity.
"Partnership Interest" means an ownership interest in the
Partnership, which shall include General Partner Interests and
Limited Partner Interests.
"Partnership Minimum Gain" means that amount determined in
accordance with the principles of Treasury Regulation Section
1.704-2(d).
"Partnership Security" means any class or series of equity
interest in the Partnership and shall include, without
limitation, Common Units and GP Units.
"Percentage Interest" means as of the date of such
determination (a) as to any Partner or Assignee holding Units,
the product obtained by multiplying (i) 100% less the percentage
applicable to paragraph (b) by (ii) the quotient obtained by
dividing (A) the number of Units held by such Partner or Assignee
by (B) the total number of all Outstanding Units, and (b) as to
the holders of additional Partnership Securities issued by the
Partnership in accordance with Section 5.5, the percentage
established as a part of such issuance.
"Person" means an individual or a corporation, limited
liability company, partnership, joint venture, trust,
unincorporated organization, association, government agency or
political subdivision thereof or other entity.
"Previous Agreement" has the meaning assigned to such term
in the recitals to this Agreement.
"Pro Rata" means (a) when modifying Units or any class
thereof, apportioned among all designated Units in accordance
with their relative Percentage Interests and (b) when modifying
Partners and Assignees, apportioned among all Partners and
Assignees in accordance with their respective Percentage
Interests.
"Proxy Statement" means the definitive Proxy Statement filed
by the Partnership with the Commission under the Securities
Exchange Act of 1934, as amended, for the purpose of soliciting
the votes of the holders of Common Units with respect to the
Restructuring, as it has been or as it may be amended or
supplemented from time to time.
"Purchase Date" means the date determined by the General
Partner as the date for purchase of all Limited Partner Interests
of a certain class (other than Limited Partner Interests owned by
the General Partner and its Affiliates) pursuant to Article XV.
"Quarter" means, unless the context requires otherwise, a
calendar quarter.
"Recapture Income" means any gain recognized by the
Partnership (computed without regard to any adjustment required
by Section 734 or 743 of the Code) upon the disposition of any
property or asset of the Partnership, which gain is characterized
as ordinary income because it represents the recapture of
deductions previously taken with respect to such property or
asset.
"Record Date" means the date established by the General
Partner for determining (a) the identity of the Record Holders
entitled to notice of, or to vote at, any meeting of Limited
Partners or entitled to vote by ballot or give approval of
Partnership action in writing without a meeting or entitled to
exercise rights in respect of any lawful action of Limited
Partners or (b) the identity of Record Holders entitled to
receive any report or distribution or participate in any offer.
"Record Holder" means the Person in whose name a Common Unit
is registered on the books of the Transfer Agent as of the
opening of business on a particular Business Day, or with respect
to other Partnership Securities, the Person in whose name any
such other Partnership Security is registered on the books which
the General Partner has caused to be kept as of the opening of
business on such Business Day.
"Redeemable Interests" means any Limited Partner Interests
for which a redemption notice has been given, and has not been
withdrawn, pursuant to Section 4.9.
"Registration Statement" means the Registration Statement on
Form S-1 (Registration No. 333-11545) as amended, filed by the
Partnership with the Commission under the Securities Act to
register the offering and sale of the Common Units in the Initial
Offering.
"Required Allocations" means (a) any limitation imposed on
any allocation of Net Loss under Section 6.1(b) and (b) any
allocation of an item of income, gain, loss or deduction pursuant
to Section 6.1(c)(i), 6.1(c)(ii), 6.1(c)(iii), 6.1(c)(vi) or
6.1(c)(viii).
"Residual Gain" or "Residual Loss" means any item of gain or
loss, as the case may be, of the Partnership recognized for
federal income tax purposes resulting from a sale, exchange or
other disposition of a Contributed Property or Adjusted Property,
to the extent such item of gain or loss is not allocated pursuant
to Section 6.2(b)(i)(A) or 6.2(b)(ii)(A), respectively, to
eliminate Book-Tax Disparities.
"Restructuring" has the meaning set forth in the recitals to
this Agreement.
"Salomon" means Xxxxxxx Xxxxx Xxxxxx Holdings Inc, a
Delaware corporation, and Salomon Brothers Holdings, Inc., a
Delaware corporation.
"Securities Act" means the Securities Act of 1933, as
amended, supplemented or restated from time to time and any
successor to such statute.
"Security Agreement" means the Security Agreement, dated as
of December 3, 1996, among Genesis OLP, Salomon and the Secured
Parties (as defined in the Security Agreement) securing the
obligations of Genesis OLP under the Master Credit Support
Agreement and creating a security interest in the Collateral (as
defined in the Security Agreement) in favor of the Collateral
Agent (as defined in the Security Agreement).
"Special Approval" means approval by a majority of the
members of the Audit Committee.
"Subsidiary" means, with respect to any Person, (a) a
corporation of which more than 50% of the voting power of shares
entitled (without regard to the occurrence of any contingency) to
vote in the election of directors or other governing body of such
corporation is owned, directly or indirectly, at the date of
determination, by such Person, by one or more Subsidiaries of
such Person or a combination thereof, (b) a partnership (whether
general or limited) in which such Person or a Subsidiary of such
Person is, at the date of determination, a general or limited
partner of such partnership, but only if more than 50% of the
partnership interests of such partnership (considering all of the
partnership interests of such partnership as a single class) is
owned, directly or indirectly, at the date of determination, by
such Person, by one or more Subsidiaries of such Person, or a
combination thereof, or (c) any other Person (other than a
corporation or a partnership) in which such Person, one or more
Subsidiaries of such Person, or a combination thereof, directly
or indirectly, at the date of determination, has (i) at least a
majority ownership interest or (ii) the power to elect or direct
the election of a majority of the directors or other governing
body of such Person.
"Substituted Limited Partner" means a Person who is admitted
as a Limited Partner to the Partnership pursuant to Section 10.2
in place of and with all the rights of a Limited Partner and who
is shown as a Limited Partner on the books and records of the
Partnership.
"Surviving Business Entity" has the meaning assigned to such
term in Section 14.2(b).
"Trading Day" has the meaning assigned to such term in
Section 15.1(a).
"transfer" has the meaning assigned to such term in Section
4.4(a).
"Transfer Agent" means such bank, trust company or other
Person (including the General Partner or one of its Affiliates)
as shall be appointed from time to time by the Partnership to act
as registrar and transfer agent for the Common Units.
"Transfer Application" means an application and agreement
for transfer of Partnership Securities in the form set forth on
the back of a Certificate or in a form substantially to the same
effect in a separate instrument.
"Two-Thirds Interest" means at least 66_% in Voting Power of
the Outstanding Limited Partner Interests.
"Unit" means a Common Unit or a GP Unit or any other
Partnership Security that is designated as a "Unit."
"Unrealized Gain" attributable to any item of Partnership
property means, as of any date of determination, the excess, if
any, of (a) the fair market value of such property as of such
date (as determined under Section 5.4(d)) over (b) the Carrying
Value of such property as of such date (prior to any adjustment
to be made pursuant to Section 5.4(d) as of such date).
"Unrealized Loss" attributable to any item of Partnership
property means, as of any date of determination, the excess, if
any, of (a) the Carrying Value of such property as of such date
(prior to any adjustment to be made pursuant to Section 5.4(d) as
of such date) over (b) the fair market value of such property as
of such date (as determined under Section 5.4(d)).
"U.S. GAAP" means United States Generally Accepted
Accounting Principles consistently applied.
"Voting Power" means the right, if any, of the holder of a
Partnership Security to vote on Partnership matters. Each Common
Unit shall entitle the holder thereof to one vote. Each
additional Partnership Security shall entitle the holder thereof
to such vote, if any, as shall be established at the time of
issuance of such Partnership Security.
"Withdrawal Opinion of Counsel" has the meaning assigned to
such term in Section 11.1(b).
1.2 Construction
Unless the context requires otherwise: (a) any pronoun used
in this Agreement shall include the corresponding masculine,
feminine or neuter forms, and the singular form of nouns,
pronouns and verbs shall include the plural and vice versa; (b)
references to Articles and Sections refer to Articles and
Sections of this Agreement; and (c) "include" or "includes" means
includes, without limitation, and "including" means including,
without limitation.
ARTICLE II
Organization
2.1 Continuation of Existence
The General Partner and the Limited Partners hereby amend
and restate the Previous Agreement in its entirety to continue
the Partnership as a limited partnership pursuant to the
provisions of the Delaware Act and to set forth the rights and
obligations of the Partners and certain matters related thereto.
This amendment and restatement shall become effective on the
date of this Agreement. Except as expressly provided to the
contrary in this Agreement, the rights, duties (including
fiduciary duties), liabilities and obligations of the Partners
and the administration, dissolution and termination of the
Partnership shall be governed by the Delaware Act. All
Partnership Interests shall constitute personal property of the
owner thereof for all purposes and a Partner has no interest in
specific Partnership property.
2.2 Name
The name of the Partnership shall be "Genesis Energy, L.P."
The Partnership's business may be conducted under any other name
or names deemed necessary or appropriate by the General Partner
in its sole discretion, including the name of the General
Partner. The words "Limited Partnership," "L.P.," "Ltd." or
similar words or letters shall be included in the Partnership's
name where necessary for the purpose of complying with the laws
of any jurisdiction that so requires. The General Partner in its
discretion may change the name of the Partnership at any time and
from time to time and shall notify the Limited Partners of such
change in the next regular communication to the Limited Partners.
2.3 Registered Office; Registered Agent; Principal Office; Other
Offices
Unless and until changed by the General Partner, the
registered office of the Partnership in the State of Delaware
shall be located at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000, and the registered agent for service
of process on the Partnership in the State of Delaware at such
registered office shall be CT Corporation System. The principal
office of the Partnership shall be located at 000 Xxxxxx, Xxxxx
0000, Xxxxxxx, Xxxxx 00000 or such other place as the General
Partner may from time to time designate by notice to the Limited
Partners. The Partnership may maintain offices at such other
place or places within or outside the State of Delaware as the
General Partner deems necessary or appropriate. The address of
the General Partner shall be 000 Xxxxxx, Xxxxx 0000, Xxxxxxx,
Xxxxx 00000 or such other place as the General Partner may from
time to time designate by notice to the Limited Partners.
2.4 Purpose and Business
The purpose and nature of the business to be conducted by
the Partnership shall be to (a) serve as a general partner in
Genesis OLP and, in connection therewith, to exercise all the
rights and powers conferred upon the Partnership as a general
partner in Genesis OLP pursuant to the Genesis OLP Partnership
Agreement or otherwise, (b) engage directly in, or enter into or
form any corporation, partnership, joint venture, limited
liability company or other arrangement to engage indirectly in,
any business activity that Genesis OLP is permitted to engage in
by the Genesis OLP Partnership Agreement and, in connection
therewith, to exercise all of the rights and powers conferred
upon the Partnership pursuant to the agreements relating to such
business activity, (c) engage directly in, or to enter into or
form any corporation, partnership, joint venture, limited
liability company or other arrangement to engage indirectly in,
any business activity that is approved by the General Partner and
which lawfully may be conducted by a limited partnership
organized pursuant to the Delaware Act and, in connection
therewith, to exercise all of the rights and powers conferred
upon the Partnership pursuant to the agreements relating to such
business activity, and (d) do anything necessary or appropriate
to the foregoing, including the making of capital contributions
or loans to a Group Member. The General Partner has no obligation
or duty to the Partnership, the Limited Partners, or the
Assignees to propose or approve, and in its discretion may
decline to propose or approve, the conduct by the Partnership of
any business.
2.5 Powers
The Partnership shall be empowered to do any and all acts
and things necessary, appropriate, proper, advisable, incidental
to or convenient for the furtherance and accomplishment of the
purposes and business described in Section 2.4 and for the
protection and benefit of the Partnership.
2.6 Power of Attorney
(a) Each Limited Partner and each Assignee hereby
constitutes and appoints the General Partner and, if a Liquidator
shall have been selected pursuant to Section 12.3, the
Liquidator, severally (and any successor to the Liquidator by
merger, transfer, assignment, election or otherwise) and each of
their authorized officers and attorneys-in-fact, as the case may
be, with full power of substitution, as his true and lawful agent
and attorney-in-fact, with full power and authority in his name,
place and xxxxx, to:
(i) execute, swear to, acknowledge, deliver, file and
record in the appropriate public offices (A) all
certificates, documents and other instruments (including
this Agreement and the Certificate of Limited Partnership
and all amendments or restatements hereof or thereof) that
the General Partner or the Liquidator deems necessary or
appropriate to form, qualify or continue the existence or
qualification of the Partnership as a limited partnership
(or a partnership in which the limited partners have limited
liability) in the State of Delaware and in all other
jurisdictions in which the Partnership may conduct business
or own property; (B) all certificates, documents and other
instruments that the General Partner or the Liquidator deems
necessary or appropriate to reflect, in accordance with its
terms, any amendment, change, modification or restatement of
this Agreement; (C) all certificates, documents and other
instruments (including conveyances and a certificate of
cancellation) that the General Partner or the Liquidator
deems necessary or appropriate to reflect the dissolution
and liquidation of the Partnership pursuant to the terms of
this Agreement; (D) all certificates, documents and other
instruments relating to the admission, withdrawal, removal
or substitution of any Partner pursuant to, or other events
described in, Article IV, X, XI or XII; (E) all
certificates, documents and other instruments relating to
the determination of the rights, preferences and privileges
of any class or series of Partnership Securities issued
pursuant to Section 5.5; and (F) all certificates, documents
and other instruments (including agreements and a
certificate of merger) relating to a merger or consolidation
of the Partnership pursuant to Article XIV; and
(ii) execute, swear to, acknowledge, deliver, file and
record all ballots, consents, approvals, waivers,
certificates, documents and other instruments necessary or
appropriate, in the discretion of the General Partner or the
Liquidator, to make, evidence, give, confirm or ratify any
vote, consent, approval, agreement or other action that is
made or given by the Partners hereunder or is consistent
with the terms of this Agreement or is necessary or
appropriate, in the discretion of the General Partner or the
Liquidator, to effectuate the terms or intent of this
Agreement; provided, that when required by Section 13.3 or
any other provision of this Agreement that establishes a
percentage of the Limited Partners or of the Limited
Partners of any class or series required to take any action,
the General Partner and the Liquidator may exercise the
power of attorney made in this Section 2.6(a)(ii) only after
the necessary vote, consent or approval of the Limited
Partners or of the Limited Partners of such class or series,
as applicable.
Nothing contained in this Section 2.6(a) shall be construed
as authorizing the General Partner to amend this Agreement except
in accordance with Article XIII or as may be otherwise expressly
provided for in this Agreement.
(b) The foregoing power of attorney is hereby declared to
be irrevocable and a power coupled with an interest, and it shall
survive and, to the maximum extent permitted by law, not be
affected by the subsequent death, incompetency, disability,
incapacity, dissolution, bankruptcy or termination of any Limited
Partner or Assignee and the transfer of all or any portion of
such Limited Partner's or Assignee's Partnership Interest and
shall extend to such Limited Partner's or Assignee's heirs,
successors, assigns and personal representatives. Each such
Limited Partner or Assignee hereby agrees to be bound by any
representation made by the General Partner or the Liquidator
acting in good faith pursuant to such power of attorney; and each
such Limited Partner or Assignee, to the maximum extent permitted
by law, hereby waives any and all defenses that may be available
to contest, negate or disaffirm the action of the General Partner
or the Liquidator taken in good faith under such power of
attorney. Each Limited Partner or Assignee shall execute and
deliver to the General Partner or the Liquidator, within 15 days
after receipt of the request therefor, such further designation,
powers of attorney and other instruments as the General Partner
or the Liquidator deems necessary to effectuate this Agreement
and the purposes of the Partnership.
2.7 Term
The term of the Partnership shall continue until the close
of Partnership business on December 31, 2086 or until the earlier
dissolution of the Partnership in accordance with the provisions
of Article XII. The existence of the Partnership as a separate
legal entity shall continue until the cancellation of the
Certificate of Limited Partnership as provided in the Delaware
Act.
2.8 Title to Partnership Assets
Title to Partnership assets, whether real, personal or mixed
and whether tangible or intangible, shall be deemed to be owned
by the Partnership as an entity, and no Partner or Assignee,
individually or collectively, shall have any ownership interest
in such Partnership assets or any portion thereof. Title to any
or all of the Partnership assets may be held in the name of the
Partnership, the General Partner, one or more of its Affiliates
or one or more nominees, as the General Partner may determine.
The General Partner hereby declares and warrants that any
Partnership assets for which record title is held in the name of
the General Partner or one or more of its Affiliates or one or
more nominees shall be held by the General Partner or such
Affiliate or nominee for the use and benefit of the Partnership
in accordance with the provisions of this Agreement; provided,
however, that the General Partner shall use reasonable efforts to
cause record title to such assets (other than those assets in
respect of which the General Partner determines that the expense
and difficulty of conveyancing makes transfer of record title to
the Partnership impracticable) to be vested in the Partnership as
soon as reasonably practicable; provided, further, that, prior to
the withdrawal or removal of the General Partner or as soon
thereafter as practicable, the General Partner shall use
reasonable efforts to effect the transfer of record title to the
Partnership and, prior to any such transfer, will provide for the
use of such assets in a manner satisfactory to the General
Partner. All Partnership assets shall be recorded as the property
of the Partnership in its books and records, irrespective of the
name in which record title to such Partnership assets is held.
ARTICLE III
Rights of Limited Partners
3.1 Limitation of Liability
The Limited Partners and the Assignees shall have no
liability under this Agreement except as expressly provided in
this Agreement or the Delaware Act.
3.2 Management of Business
No Limited Partner or Assignee, in its capacity as such,
shall participate in the operation, management or control (within
the meaning of the Delaware Act) of the Partnership's business,
transact any business in the Partnership's name or have the power
to sign documents for or otherwise bind the Partnership. Any
action taken by any Affiliate of the General Partner or any
officer, director, employee, member, general partner, agent or
trustee of the General Partner or any of its Affiliates, or any
officer, director, employee, member, general partner, agent or
trustee of a Group Member, in its capacity as such, shall not be
deemed to be participation in the control of the business of the
Partnership by a limited partner of the Partnership (within the
meaning of Section 17-303(a) of the Delaware Act) and shall not
affect, impair or eliminate the limitations on the liability of
the Limited Partners or Assignees under this Agreement.
3.3 Outside Activities of the Limited Partners
Subject to the provisions of Section 7.5, which shall
continue to be applicable to the Persons referred to therein,
regardless of whether such Persons shall also be Limited Partners
or Assignees, any Limited Partner or Assignee shall be entitled
to and may have business interests and engage in business
activities in addition to those relating to the Partnership,
including business interests and activities in direct competition
with the Partnership Group. Neither the Partnership nor any of
the other Partners or Assignees shall have any rights by virtue
of this Agreement in any business ventures of any Limited Partner
or Assignee.
3.4 Rights of Limited Partners
(a) In addition to other rights provided by this Agreement
or by applicable law, and except as limited by Section 3.4(b),
each Limited Partner shall have the right, for a purpose
reasonably related to such Limited Partner's interest as a
limited partner in the Partnership, upon reasonable written
demand and at such Limited Partner's own expense:
(i) to obtain true and full information regarding the
status of the business and financial condition of the
Partnership;
(ii) promptly after becoming available, to obtain a
copy of the Partnership's federal, state and local tax
returns for each year;
(iii) to have furnished to him a current list of the name
and last known business, residence or mailing address of
each Partner;
(iv) to have furnished to him a copy of this Agreement
and the Certificate of Limited Partnership and all
amendments thereto, together with a copy of the executed
copies of all powers of attorney pursuant to which this
Agreement, the Certificate of Limited Partnership and all
amendments thereto have been executed;
(v) to obtain true and full information regarding the
amount of cash and a description and statement of the Net
Agreed Value of any other Capital Contribution by each
Partner and which each Partner has agreed to contribute in
the future, and the date on which each became a Partner; and
(vi) to obtain such other information regarding the
affairs of the Partnership as is just and reasonable.
(b) The General Partner may keep confidential from the
Limited Partners and Assignees, for such period of time as the
General Partner deems reasonable, (i) any information that the
General Partner reasonably believes to be in the nature of trade
secrets or (ii) other information the disclosure of which the
General Partner in good faith believes (A) is not in the best
interests of the Partnership Group, (B) could damage the
Partnership Group or (C) that any Group Member is required by law
or by agreement with any third party to keep confidential (other
than agreements with Affiliates of the Partnership the primary
purpose of which is to circumvent the obligations set forth in
this Section 3.4).
ARTICLE IV
Certificates; Record Holders; Transfer of
Partnership Interests; Redemption of
Partnership Interests
4.1 Certificates
Upon the Partnership's issuance of Common Units to any
Person, the Partnership shall issue one or more Certificates in
the name of such Person evidencing the number of such Common
Units being so issued. In addition, the General Partner may cause
the Partnership to issue Certificates evidencing ownership of one
or more other classes or series of Partnership Securities.
Certificates shall be executed on behalf of the Partnership by
the Chairman of the Board, President or any Vice President and
the Secretary or any Assistant Secretary of the General Partner.
No Common Unit Certificate shall be valid for any purpose until
it has been countersigned by the Transfer Agent; provided,
however, that if the General Partner elects to issue Common Units
in global form, the Common Unit Certificates shall be valid upon
receipt of a certificate from the Transfer Agent certifying that
the Common Units have been duly registered in accordance with the
directions of the Partnership.
4.2 Mutilated, Destroyed, Lost or Stolen Certificates
(a) If any mutilated Certificate is surrendered to the
Transfer Agent, the appropriate officers of the General Partner
on behalf of the Partnership shall execute and deliver and, in
the case of a Common Unit Certificate, the Transfer Agent shall
countersign, in exchange therefor, a new Certificate evidencing
the same number and type of Partnership Securities as the
Certificate so surrendered.
(b) The appropriate officers of the General Partner on
behalf of the Partnership shall execute and deliver and, in the
case of a Common Unit Certificate, the Transfer Agent shall
countersign (or, in the case of Common Units issued in global
form, register in accordance with the rules and regulations of
the Depositary), a new Certificate in place of any Certificate
previously issued if the Record Holder of the Certificate:
(i) makes proof by affidavit, in form and substance
satisfactory to the Partnership, that a previously issued
Certificate has been lost, destroyed or stolen;
(ii) requests the issuance of a new Certificate before
the Partnership has notice that the Certificate has been
acquired by a purchaser for value in good faith and without
notice of an adverse claim;
(iii) if requested by the Partnership, delivers to the
Partnership a bond, in form and substance satisfactory to
the Partnership, with surety or sureties and with fixed or
open penalty as the Partnership may reasonably direct, in
its sole discretion, to indemnify the Partnership, the
General Partner and the Transfer Agent against any claim
that may be made on account of the alleged loss, destruction
or theft of the Certificate; and
(iv) satisfies any other reasonable requirements imposed
by the Partnership.
If a Limited Partner or Assignee fails to notify the
Partnership within a reasonable time after he has notice of the
loss, destruction or theft of a Certificate, and a transfer of
the Limited Partner Interests represented by the Certificate is
registered before the Partnership, the General Partner or the
Transfer Agent receives such notification, the Limited Partner or
Assignee shall be precluded from making any claim against the
Partnership, the General Partner or the Transfer Agent for such
transfer or for a new Certificate.
(c) As a condition to the issuance of any new Certificate
under this Section 4.2, the Partnership may require the payment
of a sum sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto and any other expenses
(including the fees and expenses of the Transfer Agent)
reasonably connected therewith.
4.3 Record Holders
The Partnership shall be entitled to recognize the Record
Holder as the Partner or Assignee with respect to any Partnership
Interest and, accordingly, shall not be bound to recognize any
equitable or other claim to or interest in such Partnership
Interest on the part of any other Person, regardless of whether
the Partnership shall have actual or other notice thereof, except
as otherwise provided by law or any applicable rule, regulation,
guideline or requirement of any National Securities Exchange on
which Limited Partner Interests are listed for trading. Without
limiting the foregoing, when a Person (such as a broker, dealer,
bank, trust company or clearing corporation or an agent of any of
the foregoing) is acting as nominee, agent or in some other
representative capacity for another Person in acquiring and/or
holding Limited Partner Interests, as between the Partnership on
the one hand, and such other Persons on the other, such
representative Person (a) shall be the Partner or Assignee (as
the case may be) of record and beneficially, (b) must execute and
deliver a Transfer Application and (c) shall be bound by this
Agreement and shall have the rights and obligations of a Partner
or Assignee (as the case may be) hereunder and as, and to the
extent, provided for herein.
4.4 Transfer Generally
(a) The term "transfer," when used in this Agreement with
respect to a Partnership Interest, shall be deemed to refer to a
transaction by which the General Partner assigns its General
Partner Interest to another Person who becomes the General
Partner, or by which the holder of a Limited Partner Interest
assigns such Limited Partner Interest to another Person who is or
becomes a Limited Partner or an Assignee, and includes a sale,
assignment, gift, pledge, encumbrance, hypothecation, mortgage,
exchange or any other disposition by law or otherwise.
(b) No Partnership Interest shall be transferred, in whole
or in part, except in accordance with the terms and conditions
set forth in this Article IV. Any transfer or purported transfer
of a Partnership Interest not made in accordance with this
Article IV shall be null and void.
(c) Nothing contained in this Agreement shall be construed
to prevent a disposition by any member of the General Partner of
any or all of the issued and outstanding member interests in the
General Partner.
4.5 Registration and Transfer of Limited Partner Interests
(a) The Partnership shall keep or cause to be kept on
behalf of the Partnership a register in which, subject to such
reasonable regulations as it may prescribe and subject to the
provisions of Section 4.5(b), the Partnership will provide for
the registration and transfer of Limited Partner Interests. The
Transfer Agent is hereby appointed registrar and transfer agent
for the purpose of registering Common Units and transfers of such
Common Units as herein provided. The Partnership shall not
recognize transfers of Certificates evidencing Limited Partner
Interests unless such transfers are effected in the manner
described in this Section 4.5. Upon surrender of a Certificate
for registration of transfer of any Limited Partner Interest, and
subject to the provisions of Section 4.5(b), the appropriate
officers of the General Partner on behalf of the Partnership
shall execute and deliver and, in the case of Common Units, the
Transfer Agent shall countersign (or, in the case of Common Units
issued in global form, register in accordance with the rules and
regulations of the Depositary), in the name of the holder or the
designated transferee or transferees, as required pursuant to the
holder's instructions, one or more new Certificates evidencing
the same aggregate number and type of Limited Partner Interests
as was evidenced by the Certificate so surrendered.
(b) Except as otherwise provided in Section 4.8, the
Partnership shall not recognize any transfer of Limited Partner
Interests until the Certificates evidencing such Limited Partner
Interests are surrendered for registration of transfer and are
accompanied by a Transfer Application duly executed by the
transferee (or the transferee's attorney-in-fact duly authorized
in writing). No charge shall be imposed by the Partnership for
such transfer; provided, that as a condition to the issuance of
any new Certificate under this Section 4.5, the Partnership may
require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed with respect thereto.
(c) Limited Partner Interests may be transferred only in
the manner described in this Section 4.5. The transfer of any
Limited Partner Interests and the admission of any new Limited
Partner shall not constitute an amendment to this Agreement.
(d) Until admitted as a Substituted Limited Partner
pursuant to Section 10.2, the Record Holder of a Limited Partner
Interest shall be an Assignee in respect of such Limited Partner
Interest. Limited Partners may include custodians, nominees or
any other individual or entity in its own or any representative
capacity.
(e) A transferee of a Limited Partner Interest who has
completed and delivered a Transfer Application shall be deemed to
have (i) requested admission as a Substituted Limited Partner,
(ii) agreed to comply with and be bound by and to have executed
this Agreement, (iii) represented and warranted that such
transferee has the right, power and authority and, if an
individual, the capacity to enter into this Agreement, (iv)
granted the powers of attorney set forth in this Agreement and
(v) given the consents and approvals and made the waivers
contained in this Agreement.
4.6 Transfer of a General Partner's General Partner Interest
Prior to December 31, 2006, the General Partner shall not
transfer all or any part of its General Partner Interest to a
Person unless such transfer (a) has been approved by the prior
written consent or vote of the holders of a Majority Interest or
(b) is of all, but not less than all, of its General Partner
Interest to (i) an Affiliate of the General Partner or (ii)
another Person in connection with the merger or consolidation of
the General Partner with or into another Person or the transfer
by the General Partner of all or substantially all of its assets
to another Person. Notwithstanding anything herein to the
contrary, no transfer by the General Partner of all or any part
of its General Partner Interest to another Person shall be
permitted unless (x) the transferee agrees to assume the rights
and duties of the General Partner under this Agreement and the
Genesis OLP Partnership Agreement and to be bound by the
provisions of this Agreement and the Genesis OLP Partnership
Agreement, (y) the Partnership receives an Opinion of Counsel
that such transfer would not result in the loss of limited
liability of any Limited Partner or of any limited partner of
Genesis OLP or cause the Partnership or Genesis OLP to be treated
as an association taxable as a corporation or otherwise to be
taxed as an entity for federal income tax purposes (to the extent
not already so treated or taxed) and (z) such transferee also
agrees to purchase all (or the appropriate portion thereof, if
applicable) of the partnership interest of the General Partner as
the general partner of each other Group Member. In the case of a
transfer pursuant to and in compliance with this Section 4.6, the
transferee or successor (as the case may be) shall, subject to
compliance with the terms of Section 10.3, be admitted to the
Partnership as a General Partner immediately prior to the
transfer of the General Partner Interest, and the business of the
Partnership shall continue without dissolution.
4.7 Restrictions on Transfers
(a) Notwithstanding the other provisions of this Article
IV, no transfer of any Partnership Interest shall be made if such
transfer would (i) violate the then applicable federal or state
securities laws or rules and regulations of the Commission, any
state securities commission or any other governmental authority
with jurisdiction over such transfer, (ii) terminate the
existence or qualification of the Partnership or Genesis OLP
under the laws of the jurisdiction of its formation or (iii)
cause the Partnership or Genesis OLP to be treated as an
association taxable as a corporation or otherwise to be taxed as
an entity for federal income tax purposes (to the extent not
already so treated or taxed).
(b) The General Partner may impose restrictions on the
transfer of Partnership Interests if a subsequent Opinion of
Counsel determines that such restrictions are necessary to avoid
a significant risk of the Partnership or Genesis OLP becoming
taxable as a corporation or otherwise to be taxed as an entity
for federal income tax purposes. The restrictions may be imposed
by making such amendments to this Agreement as the General
Partner may determine to be necessary or appropriate to impose
such restrictions; provided, however, that any amendment that the
General Partner believes, in the exercise of its reasonable
discretion, could result in the delisting or suspension of
trading of any class of Limited Partner Interests on the
principal National Securities Exchange on which such class of
Limited Partner Interests is then traded must be approved, prior
to such amendment being effected, by the holders of at least a
majority of the Outstanding Limited Partner Interests of such
class.
(c) Nothing contained in this Article IV, or elsewhere in
this Agreement, shall preclude the settlement of any transactions
involving Partnership Interests entered into through the
facilities of any National Securities Exchange on which such
Partnership Interests are listed for trading.
4.8 Citizenship Certificates; Non-citizen Assignees
(a) If any Group Member is or becomes subject to any
federal, state or local law or regulation that, in the reasonable
determination of the General Partner, creates a substantial risk
of cancellation or forfeiture of any property in which the Group
Member has an interest based on the nationality, citizenship or
other related status of a Limited Partner or Assignee, the
General Partner may request any Limited Partner or Assignee to
furnish to the General Partner, within 30 days after receipt of
such request, an executed Citizenship Certification or such other
information concerning his nationality, citizenship or other
related status (or, if the Limited Partner or Assignee is a
nominee holding for the account of another Person, the
nationality, citizenship or other related status of such Person)
as the General Partner may request. If a Limited Partner or
Assignee fails to furnish to the General Partner within the
aforementioned 30-day period such Citizenship Certification or
other requested information or if upon receipt of such
Citizenship Certification or other requested information the
General Partner determines, with the advice of counsel, that a
Limited Partner or Assignee is not an Eligible Citizen, the
Limited Partner Interests owned by such Limited Partner or
Assignee shall be subject to redemption in accordance with the
provisions of Section 4.9. In addition, the General Partner may
require that the status of any such Limited Partner or Assignee
be changed to that of a Non-citizen Assignee and, thereupon, the
General Partner shall be substituted for such Non-citizen
Assignee as the Limited Partner in respect of his Limited Partner
Interests.
(b) The General Partner shall, in exercising voting rights
in respect of Limited Partner Interests held by it on behalf of
Non-citizen Assignees, distribute the votes in the same ratios as
the votes of Limited Partners (including without limitation the
General Partner) in respect of Limited Partner Interests other
than those of Non-citizen Assignees are cast, either for, against
or abstaining as to the matter.
(c) Upon dissolution of the Partnership, a Non-citizen
Assignee shall have no right to receive a distribution in kind
pursuant to Section 12.4 but shall be entitled to the cash
equivalent thereof, and the Partnership shall provide cash in
exchange for an assignment of the Non-citizen Assignee's share of
the distribution in kind. Such payment and assignment shall be
treated for Partnership purposes as a purchase by the Partnership
from the Non-citizen Assignee of his Limited Partner Interest
(representing his right to receive his share of such distribution
in kind).
(d) At any time after he can and does certify that he has
become an Eligible Citizen, a Non-citizen Assignee may, upon
application to the General Partner, request admission as a
Substituted Limited Partner with respect to any Limited Partner
Interests of such Non-citizen Assignee not redeemed pursuant to
Section 4.9, and upon his admission pursuant to Section 10.2, the
General Partner shall cease to be deemed to be the Limited
Partner in respect of the Non-citizen Assignee's Limited Partner
Interests.
4.9 Redemption of Partnership Interests of Non-citizen Assignees
(a) If at any time a Limited Partner or Assignee fails to
furnish a Citizenship Certification or other information
requested within the 30-day period specified in Section 4.8(a),
or if upon receipt of such Citizenship Certification or other
information the General Partner determines, with the advice of
counsel, that a Limited Partner or Assignee is not an Eligible
Citizen, the Partnership may, unless the Limited Partner or
Assignee establishes to the satisfaction of the General Partner
that such Limited Partner or Assignee is an Eligible Citizen or
has transferred his Limited Partner Interests to a Person who is
an Eligible Citizen and who furnishes a Citizenship Certification
to the General Partner prior to the date fixed for redemption as
provided below, redeem the Limited Partner Interest of such
Limited Partner or Assignee as follows:
(i) The General Partner shall, not later than the 30th
day before the date fixed for redemption, give notice of
redemption to the Limited Partner or Assignee, at his last
address designated on the records of the Partnership or the
Transfer Agent, by registered or certified mail, postage
prepaid. The notice shall be deemed to have been given when
so mailed. The notice shall specify the Redeemable
Interests, the date fixed for redemption, the place of
payment, that payment of the redemption price will be made
upon surrender of the Certificate evidencing the Redeemable
Interests and that on and after the date fixed for
redemption no further allocations or distributions to which
the Limited Partner or Assignee would otherwise be entitled
in respect of the Redeemable Interests will accrue or be
made.
(ii) The aggregate redemption price for Redeemable
Interests shall be an amount equal to the Current Market
Price (the date of determination of which shall be the date
fixed for redemption) of Limited Partner Interests of the
class to be so redeemed multiplied by the number of Limited
Partner Interests of each such class included among the
Redeemable Interests. The redemption price shall be paid, in
the discretion of the General Partner, in cash or by
delivery of a promissory note of the Partnership in the
principal amount of the redemption price, bearing interest
at the rate of 10% annually and payable in three equal
annual installments of principal together with accrued
interest, commencing one year after the redemption date.
(iii) Upon surrender by or on behalf of the Limited
Partner or Assignee, at the place specified in the notice of
redemption, of the Certificate evidencing the Redeemable
Interests, duly endorsed in blank or accompanied by an
assignment duly executed in blank, the Limited Partner or
Assignee or his duly authorized representative shall be
entitled to receive the payment therefor.
(iv) After the redemption date, Redeemable Interests
shall no longer constitute issued and Outstanding Limited
Partner Interests.
(b) The provisions of this Section 4.9 shall also be
applicable to Limited Partner Interests held by a Limited Partner
or Assignee as nominee of a Person determined to be other than an
Eligible Citizen.
(c) Nothing in this Section 4.9 shall prevent the recipient
of a notice of redemption from transferring his Limited Partner
Interests before the redemption date if such transfer is
otherwise permitted under this Agreement. Upon receipt of notice
of such a transfer, the General Partner shall withdraw the notice
of redemption, provided the transferee of such Limited Partner
Interests certifies to the satisfaction of the General Partner in
a Citizenship Certification delivered in connection with the
Transfer Application that he is an Eligible Citizen. If the
transferee fails to make such certification, such redemption
shall be effected from the transferee on the original redemption
date.
ARTICLE V
Capital Contributions and Issuance of
Partnership Interests
5.1 Previous Capital Contributions
The Partners (or their predecessors) have heretofore made
Capital Contributions to the Partnership as provided in the
Previous Agreement.
5.2 Additional Contributions by General Partner
Upon the issuance of any additional Limited Partner
Interests, the General Partner shall be required to make an
additional Capital Contribution equal to 1/99th of any amount
contributed to the Partnership by the Limited Partners in
exchange for such additional Limited Partner Interests. Except
as set forth in the immediately preceding sentence and Article
XII, the General Partner shall not be obligated to make any
Capital Contributions to the Partnership.
5.3 Interest and Withdrawal
No interest shall be paid by the Partnership on Capital
Contributions. No Partner or Assignee shall be entitled to the
withdrawal or return of its Capital Contribution, except to the
extent, if any, that distributions made pursuant to this
Agreement or upon termination of the Partnership may be
considered as such by law and then only to the extent provided
for in this Agreement. Except to the extent expressly provided in
this Agreement, no Partner or Assignee shall have priority over
any other Partner or Assignee either as to the return of Capital
Contributions or as to profits, losses or distributions. Any such
return shall be a compromise to which all Partners and Assignees
agree within the meaning of Section 17-502(b) of the Delaware
Act.
5.4 Capital Accounts
(a) The Partnership shall maintain for each Partner (or a
beneficial owner of Partnership Interests held by a nominee in
any case in which the nominee has furnished the identity of such
owner to the Partnership in accordance with Section 6031(c) of
the Code or any other method acceptable to the General Partner in
its sole discretion) owning a Partnership Interest a separate
Capital Account with respect to such Partnership Interest in
accordance with the rules of Treasury Regulation Section 1.704-
1(b)(2)(iv). Such Capital Account shall be increased by (i) the
amount of all Capital Contributions made to the Partnership with
respect to such Partnership Interest pursuant to this Agreement
(including the Previous Agreement) and (ii) all items of
Partnership income and gain (including, without limitation,
income and gain exempt from tax) computed in accordance with
Section 5.4(b) and allocated with respect to such Partnership
Interest pursuant to Section 6.1, and decreased by (x) the amount
of cash or Net Agreed Value of all actual and deemed
distributions of cash or property made with respect to such
Partnership Interest pursuant to this Agreement (including the
Previous Agreement) and (y) all items of Partnership deduction
and loss computed in accordance with Section 5.4(b) and allocated
with respect to such Partnership Interest pursuant to Section
6.1.
(b) For purposes of computing the amount of any item of
income, gain, loss or deduction which is to be allocated pursuant
to Article VI and is to be reflected in the Partners' Capital
Accounts, the determination, recognition and classification of
any such item shall be the same as its determination, recognition
and classification for federal income tax purposes (including,
without limitation, any method of depreciation, cost recovery or
amortization used for that purpose), provided, that:
(i) Solely for purposes of this Section 5.4, the
Partnership shall be treated as owning directly its
proportionate share (as determined by the General Partner
based upon the provisions of the Genesis OLP Partnership
Agreement) of all property owned by Genesis OLP or any other
Subsidiary that is classified as a partnership for federal
income tax purposes.
(ii) All underwriting discounts and commissions
incurred by the Partnership in connection with the issuance
of Partnership Securities that can neither be deducted nor
amortized under Section 709 of the Code shall, for purposes
of Capital Account maintenance, be treated as an item of
deduction at the time such costs are incurred and shall be
allocated 100% to the holders of such Partnership Securities
in accordance with their relative Percentage Interests. All
other fees and other expenses incurred by the Partnership to
promote the sale of (or to sell) Partnership Securities that
can neither be deducted nor amortized under Section 709 of
the Code, if any, shall, for purposes of Capital Account
maintenance, be treated as an item of deduction at the time
such fees and other expenses are incurred and shall be
allocated among the Partners pursuant to Section 6.1.
(iii) Except as otherwise provided in Treasury
Regulation Section 1.704- 1(b)(2)(iv)(m), the computation of
all items of income, gain, loss and deduction shall be made
without regard to any election under Section 754 of the Code
which may be made by the Partnership and, as to those items
described in Section 705(a)(1)(B) or 705(a)(2)(B) of the
Code, without regard to the fact that such items are not
includable in gross income or are neither currently
deductible nor capitalized for federal income tax purposes.
To the extent an adjustment to the adjusted tax basis of any
Partnership asset pursuant to Section 734(b) or 743(b) of
the Code is required, pursuant to Treasury Regulation
Section 1.704- 1(b)(2)(iv)(m) to be taken into account in
determining Capital Accounts, the amount of such adjustment
in the Capital Accounts shall be treated as an item of gain
or loss.
(iv) Any income, gain or loss attributable to the
taxable disposition of any Partnership property shall be
determined as if the adjusted basis of such property as of
such date of disposition were equal in amount to the
Partnership's Carrying Value with respect to such property
as of such date.
(v) In accordance with the requirements of Section
704(b) of the Code, any deductions for depreciation, cost
recovery or amortization attributable to any Contributed
Property shall be determined as if the adjusted basis of
such property on the date it was acquired by the Partnership
were equal to the Agreed Value of such property. Upon an
adjustment pursuant to Section 5.4(d) to the Carrying Value
of any Partnership property subject to depreciation, cost
recovery or amortization, any further deductions for such
depreciation, cost recovery or amortization attributable to
such property shall be determined (A) as if the adjusted
basis of such property were equal to the Carrying Value of
such property immediately following such adjustment and
(B) using a rate of depreciation, cost recovery or
amortization derived from the same method and useful life
(or, if applicable, the remaining useful life) as is applied
for federal income tax purposes; provided, however, that, if
the asset has a zero adjusted basis for federal income tax
purposes, depreciation, cost recovery or amortization
deductions shall be determined using any reasonable method
that the General Partner may adopt.
(vi) If the Partnership's adjusted basis in a
depreciable or cost recovery property is reduced for federal
income tax purposes pursuant to Section 48(q)(1) or 48(q)(3)
of the Code, the amount of such reduction shall, solely for
purposes hereof, be deemed to be an additional depreciation
or cost recovery deduction in the year such property is
placed in service and shall be allocated among the Partners
pursuant to Section 6.1. Any restoration of such basis
pursuant to Section 48(q)(2) of the Code shall, to the
extent possible, be allocated in the same manner to the
Partners to whom such deemed deduction was allocated.
(c) A transferee of a Partnership Interest shall succeed to
a pro rata portion of the Capital Account of the transferor
relating to the Partnership Interest so transferred.
(d) (i) In accordance with Treasury Regulation Section
1.704-1(b)(2)(iv)(f), on an issuance of additional Partnership
Interests for cash or Contributed Property or the conversion of
the General Partner's Combined Interest to Common Units pursuant
to Section 11.3(b), the Capital Account of all Partners and the
Carrying Value of each Partnership property immediately prior to
such issuance shall be adjusted upward or downward to reflect any
Unrealized Gain or Unrealized Loss attributable to such
Partnership property, as if such Unrealized Gain or Unrealized
Loss had been recognized on an actual sale of each such property
immediately prior to such issuance and had been allocated to the
Partners at such time pursuant to Section 6.1 in the same manner
as any item of gain or loss actually recognized during such
period would have been allocated. In determining such Unrealized
Gain or Unrealized Loss, the aggregate cash amount and fair
market value of all Partnership assets (including, without
limitation, cash or cash equivalents) immediately prior to the
issuance of additional Partnership Securities shall be determined
by the General Partner using such reasonable method of valuation
as it may adopt; provided, however, that the General Partner, in
arriving at such valuation, must take fully into account the fair
market value of the Partnership Interests of all Partners at such
time. The General Partner shall allocate such aggregate value
among the assets of the Partnership (in such manner as it
determines in its discretion to be reasonable) to arrive at a
fair market value for individual properties.
(ii) In accordance with Treasury Regulation Section
1.704-1(b)(2)(iv)(f), immediately prior to any actual or
deemed distribution to a Partner of any Partnership property
(other than a distribution of cash that is not in redemption
or retirement of a Partnership Interest), the Capital
Accounts of all Partners and the Carrying Value of all
Partnership property shall be adjusted upward or downward to
reflect any Unrealized Gain or Unrealized Loss attributable
to such Partnership property, as if such Unrealized Gain or
Unrealized Loss had been recognized in a sale of such
property immediately prior to such distribution for an
amount equal to its fair market value, and had been
allocated to the Partners, at such time, pursuant to Section
6.1 in the same manner as any item of gain or loss actually
recognized during such period would have been allocated. In
determining such Unrealized Gain or Unrealized Loss the
aggregate cash amount and fair market value of all
Partnership assets (including, without limitation, cash or
cash equivalents) immediately prior to a distribution shall
(A) in the case of an actual distribution which is not made
pursuant to Section 12.4 or in the case of a deemed
contribution and/or distribution occurring as a result of a
termination of the Partnership pursuant to Section 708 of
the Code, be determined and allocated in the same manner as
that provided in Section 5.4(d)(i) or (B) in the case of a
liquidating distribution pursuant to Section 12.4, be
determined and allocated by the Liquidator using such
reasonable method of valuation as it may adopt.
5.5 Issuances of Additional Partnership Securities
(a) The Partnership may issue additional Partnership
Securities and options, rights, warrants and appreciation rights
relating to Partnership Securities for any Partnership purpose at
any time and from time to time to such Persons for such
consideration and on such terms and conditions as shall be
established by the General Partner in its sole discretion, all
without the approval of any Limited Partners.
(b) Each additional Partnership Security authorized to be
issued by the Partnership pursuant to Section 5.5(a) may be
issued in one or more classes, or one or more series of any such
classes, with such designations, preferences, rights, powers and
duties (which may be senior to existing classes and series of
Partnership Securities), as shall be fixed by the General Partner
in the exercise of its sole discretion, including (i) the right
to share Partnership profits and losses or items thereof; (ii)
the right to share in Partnership distributions; (iii) the rights
upon dissolution and liquidation of the Partnership; (iv)
whether, and the terms and conditions upon which, the Partnership
may redeem such Partnership Security; (v) whether such
Partnership Security is issued with the privilege of conversion
or exchange and, if so, the terms and conditions of such
conversion or exchange; (vi) the terms and conditions upon which
such Partnership Security will be issued, evidenced by
certificates and assigned or transferred; and (vii) the right, if
any, of such Partnership Security to vote on Partnership matters,
including matters relating to the relative rights, preferences
and privileges of such Partnership Security.
(c) The General Partner is hereby authorized and directed
to take all actions that it deems necessary or appropriate in
connection with (i) each issuance of Partnership Securities
pursuant to this Section 5.5, (ii) the conversion of a General
Partner Interest into Common Units pursuant to the terms of this
Agreement, (iii) the admission of Additional Limited Partners and
(iv) all additional issuances of Partnership Securities. The
General Partner is further authorized and directed to specify the
relative rights, powers and duties of the holders of Partnership
Securities being so issued. The General Partner shall do all
things necessary to comply with the Delaware Act and is
authorized and directed to do all things it deems to be necessary
or advisable in connection with any future issuance of
Partnership Securities or in connection with the conversion of a
General Partner Interest into Common Units pursuant to the terms
of this Agreement, including compliance with any statute, rule,
regulation or guideline of any federal, state or other
governmental agency or any National Securities Exchange on which
the Common Units or other Partnership Securities are listed for
trading.
(d) No fractional Common Units shall be issued by the
Partnership.
5.6 Limited Preemptive Right
Except as provided in this Section 5.6 and in Section 5.2,
no Person shall have any preemptive, preferential or other
similar right with respect to (a) additional Capital
Contributions; (b) the issuance of any class or series of
Partnership Interests, whether unissued, held in the treasury or
hereafter created; (c) issuance of obligations, evidence of
indebtedness or other securities of the Partnership convertible
into or exchangeable for, or carrying or accompanied by any
rights to receive, purchase or subscribe to, any such Partnership
Interests; (d) issuance of any right of subscription to or right
to receive, or any warrant or option for the purchase of, any
such Partnership Interests; or (e) issuance or sale of any other
securities that may be issued or sold by the Partnership. The
General Partner shall have the right, which it may from time to
time assign in whole or in part to any of its Affiliates, to
purchase Partnership Securities from the Partnership whenever,
and on the same terms that, the Partnership issues Partnership
Securities to Persons other than the General Partner and its
Affiliates, to the extent necessary to maintain the Percentage
Interests of the General Partner and its Affiliates equal to that
which existed immediately prior to the issuance of such
Partnership Securities.
5.7 Splits and Combination
(a) Subject to Section 5.7(d), the Partnership may make a
Pro Rata distribution of Partnership Securities to all Record
Holders or may effect a subdivision or combination of Partnership
Securities so long as, after any such event, each Partner shall
have the same Percentage Interest in the Partnership as before
such event, and any amounts calculated on a per Unit basis or
stated as a number of Units are proportionately adjusted
retroactive to the beginning of the Partnership.
(b) Whenever such a distribution, subdivision or
combination of Partnership Securities is declared, the General
Partner shall select a Record Date as of which the distribution,
subdivision or combination shall be effective and shall send
notice thereof at least 20 days prior to such Record Date to each
Record Holder as of a date not less than 10 days prior to the
date of such notice. The General Partner also may cause a firm of
independent public accountants selected by it to calculate the
number of Partnership Securities to be held by each Record Holder
after giving effect to such distribution, subdivision or
combination. The General Partner shall be entitled to rely on any
certificate provided by such firm as conclusive evidence of the
accuracy of such calculation.
(c) Promptly following any such distribution, subdivision
or combination, the Partnership may issue Certificates to the
Record Holders of Partnership Securities as of the applicable
Record Date representing the new number of Partnership Securities
held by such Record Holders, or the General Partner may adopt
such other procedures as it may deem appropriate to reflect such
changes. If any such combination results in a smaller total
number of Partnership Securities Outstanding, the Partnership
shall require, as a condition to the delivery to a Record Holder
of such new Certificate, the surrender of any Certificate held by
such Record Holder immediately prior to such Record Date.
(d) The Partnership shall not issue fractional Common Units
upon any distribution, subdivision or combination of Common
Units. If a distribution, subdivision or combination of Common
Units would result in the issuance of fractional Common Units but
for the provisions of Section 5.5(d) and this Section 5.7(d),
each fractional Common Unit shall be rounded to the nearest whole
Common Unit (and a 0.5 Common Unit shall be rounded to the next
higher Common Unit).
5.8 Fully Paid and Non-Assessable Nature of Limited Partner
Interests
All Limited Partner Interests issued pursuant to, and in
accordance with the requirements of, this Article V shall be
fully paid and non-assessable Limited Partner Interests in the
Partnership, except as such non-assessability may be affected by
Section 17-607 of the Delaware Act.
ARTICLE VI
Allocations and Distributions
6.1 Allocations for Capital Account Purposes
For purposes of maintaining the Capital Accounts and in
determining the rights of the Partners among themselves, the
Partnership's items of income, gain, loss and deduction (computed
in accordance with Section 5.4(b)) shall be allocated among the
Partners in each taxable year (or portion thereof) as provided
hereinbelow.
(a) Net Income. After giving effect to the special
allocations set forth in Section 6.1(c), Net Income for each
taxable year and all items of income, gain, loss and deduction
taken into account in computing Net Income for such taxable year
shall be allocated among the Partners as follows:
(i) First, 100% to the General Partner until the
aggregate Net Income allocated to the General Partner
pursuant to this Section 6.1(a)(i) for the current taxable
year and all previous taxable years is equal to the
aggregate Net Loss allocated to the General Partner pursuant
to Section 6.1(b)(ii) for all previous taxable years; and
(ii) Second, the balance, if any, 100% to the Partners
in accordance with their respective Percentage Interests.
(b) Net Loss. After giving effect to the special
allocations set forth in Section 6.1(c), Net Losses for each
taxable period and all items of income, gain, loss and deduction
taken into account in computing Net Losses for such taxable
period shall be allocated among the Partners as follows:
(i) First, 100% to the Partners in accordance with
their respective Percentage Interests; provided, that Net
Loss shall not be allocated pursuant to this Section
6.1(b)(i) to the extent that such allocation would cause any
Limited Partner to have a deficit balance in its Adjusted
Capital Account at the end of such taxable year (or increase
any existing deficit balance in its Adjusted Capital
Account); and
(ii) Second, the balance, if any, 100% to the General
Partner.
(c) Special Allocations. Notwithstanding any other
provision of this Section 6.1, the following special allocations
shall be made for such taxable period:
(i) Partnership Minimum Gain Chargeback.
Notwithstanding any other provision of this Section 6.1, if
there is a net decrease in Partnership Minimum Gain during
any Partnership taxable period, each Partner shall be
allocated items of Partnership income and gain for such
period (and, if necessary, subsequent periods) in the manner
and amounts provided in Treasury Regulation Sections 1.704-
2(f)(6), 1.704-2(g)(2) and 1.704-2(j)(2)(i), or any
successor provision. For purposes of this Section 6.1(c),
each Partner's Adjusted Capital Account balance shall be
determined, and the allocation of income or gain required
hereunder shall be effected, prior to the application of any
other allocations pursuant to this Section 6.1(c) with
respect to such taxable period (other than an allocation
pursuant to Sections 6.1(c)(v) and 6.1(c)(vi)). This Section
6.1(c)(i) is intended to comply with the Partnership Minimum
Gain chargeback requirement in Treasury Regulation Section
1.704-2(f) and shall be interpreted consistently therewith.
(ii) Chargeback of Partner Nonrecourse Debt Minimum
Gain. Notwithstanding the other provisions of this Section
6.1 (other than Section 6.1(c)(i)), except as provided in
Treasury Regulation Section 1.704-2(i)(4), if there is a net
decrease in Partner Nonrecourse Debt Minimum Gain during any
Partnership taxable period, any Partner with a share of
Partner Nonrecourse Debt Minimum Gain at the beginning of
such taxable period shall be allocated items of Partnership
income and gain for such period (and, if necessary,
subsequent periods) in the manner and amounts provided in
Treasury Regulation Sections 1.704-2(i)(4) and 1.704-
2(j)(2)(ii), or any successor provisions. For purposes of
this Section 6.1(c), each Partner's Adjusted Capital Account
balance shall be determined, and the allocation of income or
gain required hereunder shall be effected, prior to the
application of any other allocations pursuant to this
Section 6.1(c), other than Section 6.1(c)(i) and other than
an allocation pursuant to Sections 6.1(c)(v) and 6.1(c)(vi),
with respect to such taxable period. This Section 6.1(c)(ii)
is intended to comply with the chargeback of items of income
and gain requirement in Treasury Regulation Section 1.704-
2(i)(4) and shall be interpreted consistently therewith.
(iii) Qualified Income Offset. In the event any Partner
unexpectedly receives any adjustments, allocations or
distributions described in Treasury Regulation Section
1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), or 1.704-
1(b)(2)(ii)(d)(6), items of Partnership income and gain
shall be specially allocated to such Partner in an amount
and manner sufficient to eliminate, to the extent required
by the Treasury Regulations promulgated under Section 704(b)
of the Code, the deficit balance, if any, in its Adjusted
Capital Account created by such adjustments, allocations or
distributions as quickly as possible unless such deficit
balance is otherwise eliminated pursuant to Section
6.1(c)(i) or 6.1(c)(ii).
(iv) Gross Income Allocations. In the event any Partner
has a deficit balance in its Capital Account at the end of
any Partnership taxable period in excess of the sum of (A)
the amount such Partner is required to restore pursuant to
the provisions of this Agreement and (B) the amount such
Partner is deemed obligated to restore pursuant to Treasury
Regulation Sections 1.704-2(g) and 1.704-2(i)(5), such
Partner shall be specially allocated items of Partnership
gross income and gain in the amount of such excess as
quickly as possible; provided, that an allocation pursuant
to this Section 6.1(c)(iv) shall be made only if and to the
extent that such Partner would have a deficit balance in its
Capital Account as adjusted after all other allocations
provided for in this Section 6.1 have been tentatively made
as if this Section 6.1(c)(iv) were not in this Agreement.
(v) Nonrecourse Deductions. Nonrecourse Deductions for
any taxable period shall be allocated to the Partners in
accordance with their respective Percentage Interests. If
the General Partner determines in its good faith discretion
that the Partnership's Nonrecourse Deductions must be
allocated in a different ratio to satisfy the safe harbor
requirements of the Treasury Regulations promulgated under
Section 704(b) of the Code, the General Partner is
authorized, upon notice to the other Partners, to revise the
prescribed ratio to the numerically closest ratio that does
satisfy such requirements.
(vi) Partner Nonrecourse Deductions. Partner Nonrecourse
Deductions for any taxable period shall be allocated 100% to
the Partner that bears the Economic Risk of Loss with
respect to the Partner Nonrecourse Debt to which such
Partner Nonrecourse Deductions are attributable in
accordance with Treasury Regulation Section 1.704-2(i). If
more than one Partner bears the Economic Risk of Loss with
respect to a Partner Nonrecourse Debt, such Partner
Nonrecourse Deductions attributable thereto shall be
allocated between or among such Partners in accordance with
the ratios in which they share such Economic Risk of Loss.
(vii) Nonrecourse Liabilities. For purposes of Treasury
Regulation Section 1.752-3(a)(3), the Partners agree that
Nonrecourse Liabilities of the Partnership in excess of the
sum of (A) the amount of Partnership Minimum Gain and (B)
the total amount of Nonrecourse Built-in Gain shall be
allocated among the Partners in accordance with their
respective Percentage Interests.
(viii) Code Section 754 Adjustments. To the extent an
adjustment to the adjusted tax basis of any Partnership
asset pursuant to Section 734(b) or 743(c) of the Code is
required, pursuant to Treasury Regulation Section 1.704-
1(b)(2)(iv)(m), to be taken into account in determining
Capital Accounts, the amount of such adjustment to the
Capital Accounts shall be treated as an item of gain (if the
adjustment increases the basis of the asset) or loss (if the
adjustment decreases such basis), and such item of gain or
loss shall be specially allocated to the Partners in a
manner consistent with the manner in which their Capital
Accounts are required to be adjusted pursuant to such
Section of the Treasury Regulations.
(ix) Curative Allocation.
(A) Notwithstanding any other provision of this
Section 6.1, other than the Required Allocations, the
Required Allocations shall be taken into account in
making the Agreed Allocations so that, to the extent
possible, the net amount of items of income, gain, loss
and deduction allocated to each Partner pursuant to the
Required Allocations and the Agreed Allocations,
together, shall be equal to the net amount of such items
that would have been allocated to each such Partner under
the Agreed Allocations had the Required Allocations and
the related Curative Allocation not otherwise been
provided in this Section 6.1. Notwithstanding the
preceding sentence, Required Allocations relating to (1)
Nonrecourse Deductions shall not be taken into account
except to the extent that there has been a decrease in
Partnership Minimum Gain and (2) Partner Nonrecourse
Deductions shall not be taken into account except to the
extent that there has been a decrease in Partner
Nonrecourse Debt Minimum Gain. Allocations pursuant to
this Section 6.1(c)(ix)(A) shall only be made with
respect to Required Allocations to the extent the General
Partner reasonably determines that such allocations will
otherwise be inconsistent with the economic agreement
among the Partners. Further, allocations pursuant to this
Section 6.1(c)(ix)(A) shall be deferred with respect to
allocations pursuant to clauses (1) and (2) hereof to the
extent the General Partner reasonably determines that
such allocations are likely to be offset by subsequent
Required Allocations.
(B) The General Partner shall have reasonable
discretion, with respect to each taxable period, to
(1) apply the provisions of Section 6.1(c)(ix)(A) in
whatever order is most likely to minimize the economic
distortions that might otherwise result from the Required
Allocations, and (2) divide all allocations pursuant to
Section 6.1(c)(ix)(A) among the Partners in a manner that
is likely to minimize such economic distortions.
6.2 Allocations for Tax Purposes
(a) Except as otherwise provided herein, for federal income
tax purposes, each item of income, gain, loss and deduction shall
be allocated among the Partners in the same manner as its
correlative item of "book" income, gain, loss or deduction is
allocated pursuant to Section 6.1.
(b) In an attempt to eliminate Book-Tax Disparities
attributable to a Contributed Property or Adjusted Property,
items of income, gain, loss, depreciation, amortization and cost
recovery deductions shall be allocated for federal income tax
purposes among the Partners as follows:
(i) (A) In the case of a Contributed Property, such
items attributable thereto shall be allocated among the
Partners in the manner provided under Section 704(c) of the
Code that takes into account the variation between the
Agreed Value of such property and its adjusted basis at the
time of contribution; and (B) any item of Residual Gain or
Residual Loss attributable to a Contributed Property shall
be allocated among the Partners in the same manner as its
correlative item of "book" gain or loss is allocated
pursuant to Section 6.1.
(ii) (A) In the case of an Adjusted Property, such
items shall (1) first, be allocated among the Partners in a
manner consistent with the principles of Section 704(c) of
the Code to take into account the Unrealized Gain or
Unrealized Loss attributable to such property and the
allocations thereof pursuant to Section 5.4(d)(i) or
5.4(d)(ii), and (2) second, in the event such property was
originally a Contributed Property, be allocated among the
Partners in a manner consistent with Section 6.2(b)(i)(A);
and (B) any item of Residual Gain or Residual Loss
attributable to an Adjusted Property shall be allocated
among the Partners in the same manner as its correlative
item of "book" gain or loss is allocated pursuant to Section
6.1.
(iii) The General Partner shall apply the principles of
Treasury Regulation Section 1.704-3(d) to eliminate Book-Tax
Disparities.
(c) For the proper administration of the Partnership and
for the preservation of uniformity of the Limited Partner
Interests (or any class or classes thereof), the General Partner
shall have sole discretion to (i) adopt such conventions as it
deems appropriate in determining the amount of depreciation,
amortization and cost recovery deductions; (ii) make special
allocations for federal income tax purposes of income (including,
without limitation, gross income) or deductions; and (iii) amend
the provisions of this Agreement as appropriate (x) to reflect
the proposal or promulgation of Treasury Regulations under
Section 704(b) or 704(c) of the Code or (y) otherwise to preserve
or achieve uniformity of the Limited Partner Interests (or any
class or classes thereof). The General Partner may adopt such
conventions, make such allocations and make such amendments to
this Agreement as provided in this Section 6.2(c) only if such
conventions, allocations or amendments would not have a material
adverse effect on the Partners, the holders of any class or
classes of Limited Partner Interests issued and Outstanding or
the Partnership, and if such allocations are consistent with the
principles of Section 704 of the Code.
(d) The General Partner in its discretion may determine to
depreciate or amortize the portion of an adjustment under Section
743(b) of the Code attributable to unrealized appreciation in any
Adjusted Property (to the extent of the unamortized Book-Tax
Disparity) using a predetermined rate derived from the
depreciation or amortization method and useful life applied to
the Partnership's common basis of such property, despite any
inconsistency of such approach with Treasury Regulation Section
1.167(c)-l(a)(6) or Treasury Regulation Section 1.197-2(g)(3). If
the General Partner determines that such reporting position
cannot reasonably be taken, the General Partner may adopt
depreciation and amortization conventions under which all
purchasers acquiring Limited Partner Interests in the same month
would receive depreciation and amortization deductions, based
upon the same applicable rate as if they had purchased a direct
interest in the Partnership's property. If the General Partner
chooses not to utilize such aggregate method, the General Partner
may use any other reasonable depreciation and amortization
conventions to preserve the uniformity of the intrinsic tax
characteristics of any Limited Partner Interests that would not
have a material adverse effect on the Limited Partners or the
Record Holders of any class or classes of Limited Partner
Interests.
(e) Any gain allocated to the Partners upon the sale or
other taxable disposition of any Partnership asset shall, to the
extent possible, after taking into account other required
allocations of gain pursuant to this Section 6.2, be
characterized as Recapture Income in the same proportions and to
the same extent as such Partners (or their predecessors in
interest) have been allocated any deductions directly or
indirectly giving rise to the treatment of such gains as
Recapture Income.
(f) All items of income, gain, loss, deduction and credit
recognized by the Partnership for federal income tax purposes and
allocated to the Partners in accordance with the provisions
hereof shall be determined without regard to any election under
Section 754 of the Code which may be made by the Partnership;
provided, however, that such allocations, once made, shall be
adjusted as necessary or appropriate to take into account those
adjustments permitted or required by Sections 734 and 743 of the
Code.
(g) Each item of Partnership income, gain, loss and
deduction attributable to a transferred Partnership Interest,
shall for federal income tax purposes, be determined on an annual
basis and prorated on a monthly basis and shall be allocated to
the Partners as of the opening of the New York Stock Exchange on
the first Business Day of each month; provided, however, that
gain or loss on a sale or other disposition of any assets of the
Partnership other than in the ordinary course of business shall
be allocated to the Partners as of the opening of the New York
Stock Exchange on the first Business Day of the month in which
such gain or loss is recognized for federal income tax purposes.
The General Partner may revise, alter or otherwise modify such
methods of allocation as it determines necessary, to the extent
permitted or required by Section 706 of the Code and the
regulations or rulings promulgated thereunder.
(h) Allocations that would otherwise be made to a Limited
Partner under the provisions of this Article VI shall instead be
made to the beneficial owner of Limited Partner Interests held by
a nominee in any case in which the nominee has furnished the
identity of such owner to the Partnership in accordance with
Section 6031(c) of the Code or any other method acceptable to the
General Partner in its sole discretion.
6.3 Distributions to Record Holders
(a) Within 45 days following the end of each Quarter, an
amount equal to 100% of Available Cash with respect to such
Quarter shall, subject to Section 17-607 of the Delaware Act, be
distributed in accordance with this Article VI by the Partnership
to the Partners as of the Record Date selected by the General
Partner in its reasonable discretion in accordance with their
respective Percentage Interests. The immediately preceding
sentence shall not require any distribution of cash if and to the
extent such distribution would be prohibited by applicable law or
by any loan agreement, security agreement, mortgage, debt
instrument or other agreement or obligation to which the
Partnership is a party or by which it is bound or its assets are
subject. All distributions required to be made under this
Agreement shall be made subject to Section 17-607 of the Delaware
Act.
(b) In the event of the dissolution and liquidation of the
Partnership, all receipts received during or after the Quarter in
which the Liquidation Date occurs, other than from borrowings
described in (a)(ii) of the definition of Available Cash, shall
be applied and distributed solely in accordance with, and subject
to the terms and conditions of, Section 12.4.
(c) The General Partner shall have the discretion to treat
taxes paid by the Partnership on behalf of, or amounts withheld
with respect to, all or less than all of the Partners, as a
distribution of Available Cash to such Partners.
(d) Each distribution in respect of a Partnership Interest
shall be paid by the Partnership, directly or through the
Transfer Agent or through any other Person or agent, only to the
Record Holder of such Partnership Interest as of the Record Date
set for such distribution. Such payment shall constitute full
payment and satisfaction of the Partnership's liability in
respect of such payment, regardless of any claim of any Person
who may have an interest in such payment by reason of an
assignment or otherwise.
ARTICLE VII
Management and Operation of Business
7.1 Management
(a) The General Partner shall conduct, direct and manage
all activities of the Partnership. Except as otherwise expressly
provided in this Agreement, all management powers over the
business and affairs of the Partnership shall be exclusively
vested in the General Partner, and no Limited Partner or Assignee
shall have any management power over the business and affairs of
the Partnership. In addition to the powers now or hereafter
granted a general partner of a limited partnership under
applicable law or which are granted to the General Partner under
any other provision of this Agreement, the General Partner,
subject to Section 7.3, shall have full power and authority to do
all things and on such terms as it, in its sole discretion, may
deem necessary or appropriate to conduct the business of the
Partnership, to exercise all powers set forth in Section 2.5 and
to effectuate the purposes set forth in Section 2.4, including
the following:
(i) the making of any expenditures, the lending or
borrowing of money, the assumption or guarantee of, or other
contracting for, indebtedness and other liabilities, the
issuance of evidences of indebtedness, including
indebtedness that is convertible into Partnership
Securities, and the incurring of any other obligations;
(ii) the making of tax, regulatory and other filings,
or rendering of periodic or other reports to governmental or
other agencies having jurisdiction over the business or
assets of the Partnership;
(iii) the acquisition, disposition, mortgage, pledge,
encumbrance, hypothecation or exchange of any or all of the
assets of the Partnership or the merger or other combination
of the Partnership with or into another Person (the matters
described in this clause (iii) being subject, however, to
any prior approval that may be required by Section 7.3);
(iv) the use of the assets of the Partnership (including
cash on hand) for any purpose consistent with the terms of
this Agreement, including the financing of the conduct of
the operations of the Partnership Group, subject to
Section 7.6 the lending of funds to other Persons (including
Genesis OLP and any Group Member), the repayment of
obligations of Genesis OLP and any Group Member and the
making of capital contributions to any Group Member;
(v) the negotiation, execution and performance of any
contracts, conveyances or other instruments (including
instruments that limit the liability of the Partnership
under contractual arrangements to all or particular assets
of the Partnership, with the other party to the contract to
have no recourse against the General Partner or its assets
other than its interest in the Partnership, even if same
results in the terms of the transaction being less favorable
to the Partnership than would otherwise be the case);
(vi) the distribution of Partnership cash;
(vii) the selection and dismissal of employees (including
employees having titles such as "president," "vice
president," "secretary" and "treasurer") and agents, outside
attorneys, accountants, consultants and contractors and the
determination of their compensation and other terms of
employment or hiring;
(viii) the maintenance of such insurance for the benefit
of the Partnership Group and the Partners as it deems
necessary or appropriate;
(ix) the formation of, or acquisition of an interest in,
and the contribution of property and the making of loans to,
any further limited or general partnerships, joint ventures,
corporations or other relationships (including the
acquisition of interests in, and the contributions of
property to, Genesis OLP from time to time), subject,
however, to the restrictions set forth in Section 2.4;
(x) the control of any matters affecting the rights
and obligations of the Partnership, including the bringing
and defending of actions at law or in equity and otherwise
engaging in the conduct of litigation and the incurring of
legal expense and the settlement of claims and litigation;
(xi) the indemnification of any Person against
liabilities and contingencies to the extent permitted by
law;
(xii) the entering into of listing agreements with any
National Securities Exchange and the delisting of some or
all of the Limited Partner Interests from, or requesting
that trading be suspended on, any such exchange (subject to
any prior approval that may be required under Section 4.7);
(xiii) the purchase, sale or other acquisition or
disposition of Partnership Securities, and the issuance of
additional Partnership Securities and options, rights,
warrants and appreciation rights relating to Partnership
Securities; and
(xiv) the undertaking of any action in connection with
the Partnership's participation as a partner of Genesis OLP.
(b) Notwithstanding any other provision of this Agreement,
the Genesis OLP Partnership Agreement, the Delaware Act or any
applicable law, rule or regulation, each of the Partners and each
other Person who may acquire an interest in the Partnership
hereby (i) approves, ratifies and confirms the execution,
delivery and performance by the parties thereto of this
Agreement, the Genesis OLP Partnership Agreement and the other
agreements described in or filed as part of the Proxy Statement;
(ii) agrees that the General Partner (on its own or through any
officer of the Partnership) is authorized to execute, deliver and
perform the agreements referred to in clause (i) of this sentence
and the other agreements, acts, transactions and matters
described in or contemplated by the Proxy Statement on behalf of
the Partnership without any further act, approval or vote of the
Partners or the other Persons who may acquire an interest in the
Partnership; and (iii) agrees that the execution, delivery or
performance by the General Partner, any Group Member or any
Affiliate of any of them, of this Agreement or any agreement
authorized or permitted under this Agreement (including the
exercise by the General Partner or any Affiliate of the General
Partner of the rights accorded pursuant to Article XV), shall not
constitute a breach by the General Partner of any duty that the
General Partner may owe the Partnership or the Limited Partners
or any other Persons under this Agreement (or any other
agreements) or of any duty stated or implied by law or equity.
7.2 Certificate of Limited Partnership
The General Partner has caused the Certificate of Amended
and Restated Limited Partnership to be filed with the Secretary
of State of the State of Delaware as required by the Delaware Act
and shall use all reasonable efforts to cause to be filed such
other certificates or documents as may be determined by the
General Partner in its sole discretion to be reasonable and
necessary or appropriate for the formation, continuation,
qualification and operation of a limited partnership (or a
partnership in which the limited partners have limited liability)
in the State of Delaware or any other state in which the
Partnership may elect to do business or own property. To the
extent that such action is determined by the General Partner in
its sole discretion to be reasonable and necessary or
appropriate, the General Partner shall file amendments to and
restatements of the Certificate of Limited Partnership and do all
things to maintain the Partnership as a limited partnership (or a
partnership or other entity in which the limited partners have
limited liability) under the laws of the State of Delaware or of
any other state in which the Partnership may elect to do business
or own property. Subject to the terms of Section 3.4(a), the
General Partner shall not be required, before or after filing, to
deliver or mail a copy of the Certificate of Limited Partnership,
any qualification document or any amendment thereto to any
Limited Partner or Assignee.
7.3 Restrictions on General Partner's Authority
(a) The General Partner may not, without written approval
of the specific act by holders of all of the Outstanding Limited
Partner Interests or by other written instrument executed and
delivered by holders of all of the Outstanding Limited Partner
Interests subsequent to the date of this Agreement, take any
action in contravention of this Agreement, including, except as
otherwise provided in this Agreement (i) committing any act that
would make it impossible to carry on the ordinary business of the
Partnership; (ii) possessing Partnership property, or assigning
any rights in specific Partnership property, for other than a
Partnership purpose; (iii) admitting a Person as a Partner;
(iv) amending this Agreement in any manner; or (v) transferring
its General Partner Interest.
(b) Except as provided in Articles XII and XIV, the General
Partner may not sell, exchange or otherwise dispose of all or
substantially all of the assets of the Partnership Group in a
single transaction or a series of related transactions (including
by way of merger, consolidation or other combination) or approve
on behalf of the Partnership the sale, exchange or other
disposition of all or substantially all of the assets of the
Partnership, without the approval of holders of a Majority
Interest; provided, however, that this provision shall not
preclude or limit the General Partner's ability to mortgage,
pledge, hypothecate or grant a security interest in all or
substantially all of the assets of the Partnership Group and
shall not apply to any forced sale of any or all of the assets of
the Partnership Group pursuant to the foreclosure of, or other
realization upon, any such encumbrance; and provided, further,
that this provision shall not preclude or limit the ability of
Genesis OLP to sell, exchange or otherwise dispose of all of the
assets of Genesis OLP in a single transaction or a series of
related transactions that is approved by the limited partners of
Genesis OLP as provided in Section 7.3(b) of the Genesis OLP
Partnership Agreement.
(c) Without the approval of holders of a Majority Interest,
the General Partner shall not, on behalf of the Partnership, (i)
consent to any amendment to the Genesis OLP Partnership Agreement
or, except as expressly permitted by Section 7.9(d), take any
action permitted to be taken by a partner of Genesis OLP, in
either case, that would have a material adverse effect on the
Partnership as a partner of Genesis OLP or (ii) except as
permitted under Sections 4.6, 11.1 and 11.2, elect or cause the
Partnership to elect a successor general partner of Genesis OLP.
7.4 Reimbursement of the General Partner
(a) Except as provided in this Section 7.4 and elsewhere in
this Agreement or in the Genesis OLP Partnership Agreement, the
General Partner shall not be compensated for its services as
general partner of any Group Member.
(b) The General Partner shall be reimbursed on a monthly
basis, or such other reasonable basis as the General Partner may
determine in its sole discretion, for (i) all direct and indirect
expenses it incurs or payments it makes on behalf of the
Partnership (including salary, bonus, incentive compensation and
other amounts paid to any Person, including Affiliates of the
General Partner, to perform services for the Partnership or for
the General Partner in the discharge of its duties to the
Partnership), and (ii) all other necessary or appropriate
expenses allocable to the Partnership or otherwise reasonably
incurred by the General Partner in connection with operating the
Partnership's business (including expenses allocated to the
General Partner by its Affiliates). The General Partner shall
determine the expenses that are allocable to the Partnership in
any reasonable manner determined by the General Partner in its
sole discretion. Reimbursements pursuant to this Section 7.4
shall be in addition to any reimbursement to the General Partner
as a result of indemnification pursuant to Section 7.7.
(c) The General Partner, in its sole discretion and without
the approval of the Limited Partners (who shall have no right to
vote in respect thereof), may propose and adopt on behalf of the
Partnership employee benefit plans, employee programs and
employee practices (including plans, programs and practices
involving the issuance of Partnership Securities or options to
purchase Partnership Securities), or cause the Partnership to
issue Partnership Securities pursuant to any employee benefit
plan, employee program or employee practice maintained or
sponsored by the General Partner or any of its Affiliates, in
each case for the benefit of employees of the General Partner,
any Group Member or any Affiliate, or any of them, in respect of
services performed, directly or indirectly, for the benefit of
the Partnership Group. The Partnership agrees to issue and sell
to the General Partner or any of its Affiliates any Partnership
Securities that the General Partner or such Affiliate is
obligated to provide to any employees pursuant to any such
employee benefit plans, employee programs or employee practices.
Expenses incurred by the General Partner in connection with any
such plans, programs and practices (including the net cost to the
General Partner or such Affiliate of Partnership Securities
purchased by the General Partner or such Affiliate from the
Partnership to fulfill options or awards under such plans,
programs and practices) shall be reimbursed in accordance with
Section 7.4(b). Any and all obligations of the General Partner
under any employee benefit plans, employee programs or employee
practices adopted by the General Partner as permitted by this
Section 7.4(c) shall constitute obligations of the General
Partner hereunder and shall be assumed by any successor General
Partner approved pursuant to Section 11.1 or 11.2 or the
transferee of or successor to all of the General Partner's
General Partner Interest pursuant to Section 4.6.
7.5 Outside Activities
(a) After the Restructuring Closing Date, the General
Partner, for so long as it is the general partner of the
Partnership (i) agrees that its sole business will be to act as a
general partner or managing member, as the case may be, of the
Partnership, Genesis OLP and any other partnership or limited
liability company of which the Partnership or Genesis OLP is,
directly or indirectly, a partner or member and to undertake
activities that are ancillary or related thereto (including being
a limited partner or member in the Partnership or any such other
partnership or limited liability company) and (ii) shall not,
directly or indirectly, engage in any business or activity or
incur any debts or liabilities except in connection with or
incidental to (A) its performance as general partner or managing
member, as the case may be, of one or more Group Members or as
described in or contemplated by the Registration Statement or the
Proxy Statement or (B) the acquiring, owning or disposing of debt
or equity securities of any Group Member.
(b) Salomon, Basis Petroleum, Inc. and Xxxxxx continue to
be parties to the Non-Competition Agreement, which agreement sets
forth certain restrictions on their ability to engage in the
business of (i) crude oil gathering at the wellhead in the states
of Alabama, Florida, Kansas, Louisiana, Mississippi, New Mexico,
Oklahoma or Texas, or any states contiguous to such states, and
(ii) transporting for third parties crude oil by pipeline along
the routes of the Partnership's crude oil pipelines owned as of
the Initial Closing Date. The Non-Competition Agreement remains
in effect in accordance with its terms.
(c) Except as specifically restricted by Section 7.5(a) and
the Non-Competition Agreement, each Indemnitee (other than the
General Partner) shall have the right to engage in businesses of
every type and description and other activities for profit and to
engage in and possess an interest in other business ventures of
any and every type or description, whether in businesses engaged
in or anticipated to be engaged in by any Group Member,
independently or with others, including business interests and
activities in direct competition with the business and activities
of any Group Member, and none of the same shall constitute a
breach of this Agreement or any duty express or implied by law to
any Group Member or any Partner. Neither any Group Member, any
Limited Partner nor any other Person shall have any rights by
virtue of this Agreement, the Genesis OLP Partnership Agreement
or the partnership relationship established hereby or thereby in
any business ventures of any Indemnitee.
(d) Subject to the terms of Sections 7.5(a), 7.5(b) and
7.5(c) and the Non-Competition Agreement, but otherwise
notwithstanding anything to the contrary in this Agreement, (i)
the engaging in competitive activities by any Indemnitees (other
than the General Partner) in accordance with the provisions of
this Section 7.5 is hereby approved by the Partnership and all
Partners and (ii) it shall be deemed not to be a breach of the
General Partner's fiduciary duty or any other obligation of any
type whatsoever of the General Partner for the Indemnitees (other
than the General Partner) to engage in such business interests
and activities in preference to or to the exclusion of the
Partnership, and the General Partner and the Indemnitees shall
have no obligation to present business opportunities to the
Partnership.
(e) The General Partner and any of its Affiliates may
acquire Partnership Securities in addition to those heretofore
acquired and, except as otherwise provided in this Agreement,
shall be entitled to exercise all rights relating to such
Partnership Securities.
(f) The term "Affiliates" when used in Section 7.5 with
respect to the General Partner shall not include any Group Member
or any Subsidiary of the Group Member.
7.6 Loans from the General Partner; Loans or Contributions from
the Partnership; Contracts with Affiliates; Certain
Restrictions on the General Partner
(a) The General Partner or any Affiliate thereof may lend
to any Group Member, and any Group Member may borrow from the
General Partner or any of its Affiliates, funds needed or desired
by the Group Member for such periods of time and in such amounts
as the General Partner may determine; provided, however, that in
any such case the lending party may not charge the borrowing
party interest at a rate greater than the rate that would be
charged the borrowing party or impose terms less favorable to the
borrowing party than would be charged or imposed on the borrowing
party by unrelated lenders on comparable loans made on an arm's-
length basis (without reference to the lending party's financial
abilities or guarantees). The borrowing party shall reimburse the
lending party for any costs (other than any additional interest
costs) incurred by the lending party in connection with the
borrowing of such funds. For purposes of this Section 7.6(a) and
Section 7.6(b), the term "Group Member" shall include any
Affiliate of a Group Member that is controlled by the Group
Member. No Group Member may lend funds to the General Partner or
any of its Affiliates (other than another Group Member).
(b) The Partnership may lend or contribute to any Group
Member, and any Group Member may borrow from the Partnership,
funds on terms and conditions established in the sole discretion
of the General Partner; provided, however, that the Partnership
may not charge the Group Member interest at a rate less than the
rate that would be charged to the Group Member (without reference
to the General Partner's financial abilities or guarantees) by
unrelated lenders on comparable loans. The foregoing authority
shall be exercised by the General Partner in its sole discretion
and shall not create any right or benefit in favor of any Group
Member or any other Person.
(c) The General Partner may itself, or may enter into an
agreement with any of its Affiliates to, render services to a
Group Member or to the General Partner in the discharge of its
duties as general partner of the Partnership. Any services
rendered to a Group Member by the General Partner or any of its
Affiliates shall be on terms that are fair and reasonable to the
Partnership; provided, however, that the requirements of this
Section 7.6(c) shall be deemed satisfied as to (i) any
transaction approved by Special Approval, (ii) any transaction,
the terms of which are no less favorable to the Partnership Group
than those generally being provided to or available from
unrelated third parties or (iii) any transaction that, taking
into account the totality of the relationships between the
parties involved (including other transactions that may be
particularly favorable or advantageous to the Partnership Group),
is equitable to the Partnership Group. The provisions of Section
7.4 shall apply to the rendering of services described in this
Section 7.6(c).
(d) The Partnership Group may transfer assets to joint
ventures, other partnerships, corporations, limited liability
companies or other business entities in which it is or thereby
becomes a participant upon such terms and subject to such
conditions as are consistent with this Agreement and applicable
law.
(e) Neither the General Partner nor any of its Affiliates
shall sell, transfer or convey any property to, or purchase any
property from the Partnership, directly or indirectly, except
pursuant to transactions that are fair and reasonable to the
Partnership; provided, however, that the requirements of this
Section 7.6(e) shall be deemed to be satisfied as to (i) the
transactions effected pursuant to Sections 5.2 and 5.3 of the
Previous Agreement, the Conveyance Agreement and any other
transactions described in or contemplated by the Registration
Statement or the Proxy Statement, (ii) any transaction approved
by Special Approval, (iii) any transaction, the terms of which
are no less favorable to the Partnership than those generally
being provided to or available from unrelated third parties, or
(iv) any transaction that, taking into account the totality of
the relationships between the parties involved (including other
transactions that may be particularly favorable or advantageous
to the Partnership), is equitable to the Partnership. With
respect to any contribution of assets to the Partnership in
exchange for Partnership Securities, the Audit Committee, in
determining whether the appropriate number of Partnership
Securities are being issued, may take into account, among other
things, the fair market value of the assets, the liquidated and
contingent liabilities assumed, the tax basis in the assets, the
extent to which tax-only allocations to the transferor will
protect the existing partners of the Partnership against a low
tax basis, and such other factors as the Audit Committee deems
relevant under the circumstances.
(f) The General Partner and its Affiliates will have no
obligation to permit any Group Member to use any facilities or
assets of the General Partner and its Affiliates, except as may
be provided in contracts entered into from time to time
specifically dealing with such use, nor shall there be any
obligation on the part of the General Partner or its Affiliates
to enter into such contracts.
(g) Without limitation of Sections 7.6(a) through 7.6(f),
and notwithstanding anything to the contrary in this Agreement,
the existence of the conflicts of interest described in the
Registration Statement or the Proxy Statement are hereby approved
by all Partners.
7.7 Indemnification
(a) To the fullest extent permitted by law but subject to
the limitations expressly provided in this Agreement, all
Indemnitees shall be indemnified and held harmless by the
Partnership from and against any and all losses, claims, damages,
liabilities, joint or several, expenses (including legal fees and
expenses), judgments, fines, penalties, interest, settlements or
other amounts arising from any and all claims, demands, actions,
suits or proceedings, whether civil, criminal, administrative or
investigative, in which any Indemnitee may be involved, or is
threatened to be involved, as a party or otherwise, by reason of
its status as an Indemnitee; provided, that in each case the
Indemnitee acted in good faith and in a manner that such
Indemnitee reasonably believed to be in, or not opposed to, the
best interests of the Partnership and, with respect to any
criminal proceeding, had no reasonable cause to believe its
conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction or upon a
plea of nolo contendere, or its equivalent, shall not create a
presumption that the Indemnitee acted in a manner contrary to
that specified above. Any indemnification pursuant to this
Section 7.7 shall be made only out of the assets of the
Partnership, it being agreed that the General Partner shall not
be personally liable for such indemnification and shall have no
obligation to contribute or loan any monies or property to the
Partnership to enable it to effectuate such indemnification.
(b) To the fullest extent permitted by law, expenses
(including legal fees and expenses) incurred by an Indemnitee who
is indemnified pursuant to Section 7.7(a) in defending any claim,
demand, action, suit or proceeding shall, from time to time, be
advanced by the Partnership prior to the final disposition of
such claim, demand, action, suit or proceeding upon receipt by
the Partnership of any undertaking by or on behalf of the
Indemnitee to repay such amount if it shall be determined that
the Indemnitee is not entitled to be indemnified as authorized in
this Section 7.7.
(c) The indemnification provided by this Section 7.7 shall
be in addition to any other rights to which an Indemnitee may be
entitled under any agreement, pursuant to any vote of the holders
of Outstanding Limited Partner Interests, as a matter of law or
otherwise, both as to actions in the Indemnitee's capacity as an
Indemnitee and as to actions in any other capacity (including any
capacity under the Underwriting Agreement dated November 26, 1996
among the Partnership, Genesis OLP, and the underwriters and
other parties named therein), and shall continue as to an
Indemnitee who has ceased to serve in such capacity and shall
inure to the benefit of the heirs, successors, assigns and
administrators of the Indemnitee.
(d) The Partnership may purchase and maintain (or reimburse
the General Partner or its Affiliates for the cost of) insurance,
on behalf of the General Partner, its Affiliates and such other
Persons as the General Partner shall determine, against any
liability that may be asserted against or expense that may be
incurred by such Person in connection with the Partnership's
activities or such Person's activities on behalf of the
Partnership, regardless of whether the Partnership would have the
power to indemnify such Person against such liability under the
provisions of this Agreement.
(e) For purposes of this Section 7.7, the Partnership shall
be deemed to have requested an Indemnitee to serve as fiduciary
of an employee benefit plan whenever the performance by it of its
duties to the Partnership also imposes duties on, or otherwise
involves services by, it to the plan or participants or
beneficiaries of the plan; excise taxes assessed on an Indemnitee
with respect to an employee benefit plan pursuant to applicable
law shall constitute "fines" within the meaning of Section
7.7(a); and action taken or omitted by it with respect to any
employee benefit plan in the performance of its duties for a
purpose reasonably believed by it to be in the interest of the
participants and beneficiaries of the plan shall be deemed to be
for a purpose which is in, or not opposed to, the best interests
of the Partnership.
(f) In no event may an Indemnitee subject the Limited
Partners to personal liability by reason of the indemnification
provisions set forth in this Agreement.
(g) An Indemnitee shall not be denied indemnification in
whole or in part under this Section 7.7 because the Indemnitee
had an interest in the transaction with respect to which the
indemnification applies if the transaction was otherwise
permitted by the terms of this Agreement.
(h) The provisions of this Section 7.7 are for the benefit
of the Indemnitees, their heirs, successors, assigns and
administrators and shall not be deemed to create any rights for
the benefit of any other Persons.
(i) No amendment, modification or repeal of this Section
7.7 or any provision hereof shall in any manner terminate, reduce
or impair the right of any past, present or future Indemnitee to
be indemnified by the Partnership, nor the obligations of the
Partnership to indemnify any such Indemnitee under and in
accordance with the provisions of this Section 7.7 as in effect
immediately prior to such amendment, modification or repeal with
respect to claims arising from or relating to matters occurring,
in whole or in part, prior to such amendment, modification or
repeal, regardless of when such claims may arise or be asserted.
7.8 Liability of Indemnitees
(a) Notwithstanding anything to the contrary set forth in
this Agreement, no Indemnitee shall be liable for monetary
damages to the Partnership, the Limited Partners, the Assignees
or any other Persons who have acquired interests in Partnership
Securities, for losses sustained or liabilities incurred as a
result of any act or omission if such Indemnitee acted in good
faith.
(b) Subject to its obligations and duties as General
Partner set forth in Section 7.1(a), the General Partner may
exercise any of the powers granted to it by this Agreement and
perform any of the duties imposed upon it hereunder either
directly or by or through its agents, and the General Partner
shall not be responsible for any misconduct or negligence on the
part of any such agent appointed by the General Partner in good
faith.
(c) To the extent that, at law or in equity, an Indemnitee
has duties (including fiduciary duties) and liabilities relating
thereto to the Partnership or to the Partners, the General
Partner and any other Indemnitee acting in connection with the
Partnership's business or affairs shall not be liable to the
Partnership or to any Partner for its good faith reliance on the
provisions of this Agreement. The provisions of this Agreement,
to the extent that they restrict or otherwise modify the duties
and liabilities of an Indemnitee otherwise existing at law or in
equity, are agreed by the Partners to replace such other duties
and liabilities of such Indemnitee.
(d) Any amendment, modification or repeal of this Section
7.8 or any provision hereof shall be prospective only and shall
not in any way affect the limitations on the liability of the
Indemnitees under this Section 7.8 as in effect immediately prior
to such amendment, modification or repeal with respect to claims
arising from or relating to matters occurring, in whole or in
part, prior to such amendment, modification or repeal, regardless
of when such claims may arise or be asserted.
7.9 Resolution of Conflicts of Interest
(a) Unless otherwise expressly provided in this Agreement
or the Genesis OLP Partnership Agreement, whenever a potential
conflict of interest exists or arises between the General Partner
or any of its Affiliates, on the one hand, and the Partnership,
Genesis OLP, any Partner, or any Assignee on the other, any
resolution or course of action by the General Partner or its
Affiliates in respect of such conflict of interest shall be
permitted and deemed approved by all Partners, and shall not
constitute a breach of this Agreement, of the Genesis OLP
Partnership Agreement, of any agreement contemplated herein, or
of any duty stated or implied by law or equity, if the resolution
or course of action is, or by operation of this Agreement is
deemed to be, fair and reasonable to the Partnership. The General
Partner shall be authorized but not required in connection with
its resolution of such conflict of interest to seek Special
Approval of such resolution. Any conflict of interest and any
resolution of such conflict of interest shall be conclusively
deemed fair and reasonable to the Partnership if such conflict of
interest or resolution is (i) approved by Special Approval (as
long as the material facts known to the General Partner or any of
its Affiliates regarding any proposed transaction were disclosed
to the Audit Committee at the time it gave its approval), (ii) on
terms no less favorable to the Partnership than those generally
being provided to or available from unrelated third parties or
(iii) fair to the Partnership, taking into account the totality
of the relationships between the parties involved (including
other transactions that may be particularly favorable or
advantageous to the Partnership). The General Partner may also
adopt a resolution or course of action that has not received
Special Approval. The General Partner (including the Audit
Committee in connection with Special Approval) shall be
authorized in connection with its determination of what is "fair
and reasonable" to the Partnership and in connection with its
resolution of any conflict of interest to consider (A) the
relative interests of any party to such conflict, agreement,
transaction or situation and the benefits and burdens relating to
such interest; (B) any customary or accepted industry practices
and any customary or historical dealings with a particular
Person; (C) any applicable generally accepted accounting
practices or principles; and (D) such additional factors as the
General Partner (including the Audit Committee) determines in its
sole discretion to be relevant, reasonable or appropriate under
the circumstances. Nothing contained in this Agreement, however,
is intended to nor shall it be construed to require the General
Partner (including the Audit Committee) to consider the interests
of any Person other than the Partnership. In the absence of bad
faith by the General Partner, the resolution, action or terms so
made, taken or provided by the General Partner with respect to
such matter shall not constitute a breach of this Agreement or
any other agreement contemplated herein or a breach of any
standard of care or duty imposed herein or therein or, to the
extent permitted by law, under the Delaware Act or any other law,
rule or regulation.
(b) Whenever this Agreement or any other agreement
contemplated hereby provides that the General Partner or any of
its Affiliates is permitted or required to make a decision (i) in
its "sole discretion" or "discretion," that it deems "necessary
or appropriate" or "necessary or advisable" or under a grant of
similar authority or latitude, except as otherwise provided
herein, the General Partner or such Affiliate shall be entitled
to consider only such interests and factors as it desires and
shall have no duty or obligation to give any consideration to any
interest of, or factors affecting, the Partnership, Genesis OLP,
any Limited Partner or any Assignee, (ii) it may make such
decision in its sole discretion (regardless of whether there is a
reference to "sole discretion" or "discretion") unless another
express standard is provided for, or (iii) in "good faith" or
under another express standard, the General Partner or such
Affiliate shall act under such express standard and shall not be
subject to any other or different standards imposed by this
Agreement, the Genesis OLP Partnership Agreement, any other
agreement contemplated hereby or under the Delaware Act or any
other law, rule or regulation. In addition, any actions taken by
the General Partner or such Affiliate consistent with the
standards of "reasonable discretion" set forth in the definition
of Available Cash shall not constitute a breach of any duty of
the General Partner to the Partnership or the Limited Partners.
The General Partner shall have no duty, express or implied, to
sell or otherwise dispose of any asset of the Partnership Group
other than in the ordinary course of business. No borrowing by
any Group Member or the approval thereof by the General Partner
shall be deemed to constitute a breach of any duty of the General
Partner to the Partnership or the Limited Partners or the
Assignees by reason of the fact that the purpose or effect of
such borrowing is directly or indirectly to enable Genesis OLP to
make Incentive Compensation Payments to the General Partner.
(c) Whenever a particular transaction, arrangement or
resolution of a conflict of interest is required under this
Agreement to be "fair and reasonable" to any Person, the fair and
reasonable nature of such transaction, arrangement or resolution
shall be considered in the context of all similar or related
transactions.
(d) The Limited Partners hereby authorize the General
Partner, on behalf of the Partnership as a partner of a Group
Member, to approve of actions by the general partner of such
Group Member similar to those actions permitted to be taken by
the General Partner pursuant to this Section 7.9.
7.10 Other Matters Concerning the General Partner
(a) The General Partner may rely and shall be protected in
acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice,
request, consent, order, bond, debenture or other paper or
document believed by it to be genuine and to have been signed or
presented by the proper party or parties.
(b) The General Partner may consult with legal counsel,
accountants, appraisers, management consultants, investment
bankers and other consultants and advisers selected by it, and
any act taken or omitted to be taken in reliance upon the opinion
(including an Opinion of Counsel) of such Persons as to matters
that the General Partner reasonably believes to be within such
Person's professional or expert competence shall be conclusively
presumed to have been done or omitted in good faith and in
accordance with such opinion.
(c) The General Partner shall have the right, in respect of
any of its powers or obligations hereunder, to act through any of
its duly authorized officers, a duly appointed attorney or
attorneys-in-fact or the duly authorized officers of the
Partnership.
(d) Any standard of care and duty imposed by this Agreement
or under the Delaware Act or any applicable law, rule or
regulation shall be modified, waived or limited, to the extent
permitted by law, as required to permit the General Partner to
act under this Agreement or any other agreement contemplated by
this Agreement and to make any decision pursuant to the authority
prescribed in this Agreement, so long as such action is
reasonably believed by the General Partner to be in, or not
inconsistent with, the best interests of the Partnership.
7.11 Purchase or Sale of Partnership Securities
The General Partner may cause the Partnership to purchase or
otherwise acquire Partnership Securities. As long as Partnership
Securities are held by any Group Member, such Partnership
Securities shall not be considered Outstanding for any purpose,
except as otherwise provided herein. The General Partner and any
Affiliate of the General Partner may also purchase or otherwise
acquire and sell or otherwise dispose of Partnership Securities
for its own account, subject to the provisions of Articles IV and
X.
7.12 Registration Rights of the General Partner and its
Affiliates
(a) If (i) the General Partner or any Affiliate of the
General Partner (including for purposes of this Section 7.12, any
Person that is an Affiliate of the General Partner at the date
hereof notwithstanding that it may later cease to be an Affiliate
of the General Partner) holds Partnership Securities that it
desires to sell and (ii) Rule 144 of the Securities Act (or any
successor rule or regulation to Rule 144) or another exemption
from registration is not available to enable such holder of
Partnership Securities (the "Holder") to dispose of the number of
Partnership Securities it desires to sell at the time it desires
to do so without registration under the Securities Act, then upon
the request of the General Partner or any of its Affiliates, the
Partnership shall file with the Commission as promptly as
practicable after receiving such request, and use all reasonable
efforts to cause to become effective and remain effective for a
period of not less than six months following its effective date
or such shorter period as shall terminate when all Partnership
Securities covered by such registration statement have been sold,
a registration statement under the Securities Act registering the
offering and sale of the number of Partnership Securities
specified by the Holder; provided, however, that the Partnership
shall not be required to effect more than three registrations
pursuant to this Section 7.12(a); and provided further, however,
that if the Audit Committee determines in its good faith judgment
that a postponement of the requested registration for up to six
months would be in the best interests of the Partnership and its
Partners due to a pending transaction, investigation or other
event, the filing of such registration statement or the
effectiveness thereof may be deferred for up to six months, but
not thereafter. In connection with any registration pursuant to
the immediately preceding sentence, the Partnership shall
promptly prepare and file (x) such documents as may be necessary
to register or qualify the Partnership Securities subject to such
registration under the securities laws of such states as the
Holder shall reasonably request; provided, however, that no such
qualification shall be required in any jurisdiction where, as a
result thereof, the Partnership would become subject to general
service of process or to taxation or qualification to do business
as a foreign corporation or partnership doing business in such
jurisdiction solely as a result of such registration and (y) such
documents as may be necessary to apply for listing or to list the
Partnership Securities subject to such registration on such
National Securities Exchange as the Holder shall reasonably
request, and do any and all other acts and things that may
reasonably be necessary or advisable to enable the Holder to
consummate a public sale of such Partnership Securities in such
states. Except as set forth in Section 7.12(c), all costs and
expenses of any such registration and offering (other than the
underwriting discounts and commissions) shall be paid by the
Partnership, without reimbursement by the Holder.
(b) If the Partnership shall at any time propose to file a
registration statement under the Securities Act for an offering
of Partnership Securities for cash (other than an offering
relating solely to an employee benefit plan), the Partnership
shall use all reasonable efforts to include such number or amount
of Partnership Securities held by the Holder in such registration
statement as the Holder shall request. If the proposed offering
pursuant to this Section 7.12(b) shall be an underwritten
offering, then, in the event that the managing underwriter or
managing underwriters of such offering advise the Partnership and
the Holder in writing that in their opinion the inclusion of all
or some of the Holder's Partnership Securities would adversely
and materially affect the success of the offering, the
Partnership shall include in such offering only that number or
amount, if any, of Partnership Securities held by the Holder
which, in the opinion of the managing underwriter or managing
underwriters, will not so adversely and materially affect the
offering. Except as set forth in Section 7.12(c), all costs and
expenses of any such registration and offering (other than the
underwriting discounts and commissions) shall be paid by the
Partnership, without reimbursement by the Holder.
(c) If underwriters are engaged in connection with any
registration referred to in this Section 7.12, the Partnership
shall provide indemnification, representations, covenants,
opinions and other assurance to the underwriters in form and
substance reasonably satisfactory to such underwriters. Further,
in addition to and not in limitation of the Partnership's
obligation under Section 7.7, the Partnership shall, to the
fullest extent permitted by law, indemnify and hold harmless the
Holder, its officers, directors and each Person who controls the
Holder (within the meaning of the Securities Act) and any agent
thereof (collectively, "Indemnified Persons") against any losses,
claims, demands, actions, causes of action, assessments, damages,
liabilities (joint or several), costs and expenses (including
interest, penalties and reasonable attorneys' fees and
disbursements), resulting to, imposed upon, or incurred by the
Indemnified Persons, directly or indirectly, under the Securities
Act or otherwise (hereinafter referred to in this Section 7.12(c)
as a "claim" and in the plural as "claims") based upon, arising
out of or resulting from any untrue statement or alleged untrue
statement of any material fact contained in any registration
statement under which any Partnership Securities were registered
under the Securities Act or any state securities or Blue Sky
laws, in any preliminary prospectus (if used prior to the
effective date of such registration statement), or in any summary
or final prospectus or in any amendment or supplement thereto (if
used during the period the Partnership is required to keep the
registration statement current), or arising out of, based upon or
resulting from the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to
make the statements made therein not misleading; provided,
however, that the Partnership shall not be liable to any
Indemnified Person to the extent that any such claim arises out
of, is based upon or results from an untrue statement or alleged
untrue statement or omission or alleged omission made in such
registration statement, such preliminary, summary or final
prospectus or such amendment or supplement, in reliance upon and
in conformity with written information furnished to the
Partnership by or on behalf of such Indemnified Person
specifically for use in the preparation thereof.
(d) The provisions of Section 7.12(a) and 7.12(b) shall
continue to be applicable with respect to the General Partner
(and any of the General Partner's Affiliates) after it ceases to
be a General Partner of the Partnership, during a period of two
years subsequent to the effective date of such cessation and for
so long thereafter as is required for the Holder to sell all of
the Partnership Securities with respect to which it has requested
during such two-year period inclusion in a registration statement
otherwise filed or that a registration statement be filed;
provided, however, that the Partnership shall not be required to
file successive registration statements covering the same
Partnership Securities for which registration was demanded during
such two-year period. The provisions of Section 7.12(c) shall
continue in effect thereafter.
(e) Any request to register Partnership Securities pursuant
to this Section 7.12 shall (i) specify the Partnership Securities
intended to be offered and sold by the Person making the request,
(ii) express such Person's present intent to offer such shares
for distribution, (iii) describe the nature or method of the
proposed offer and sale of Partnership Securities, and (iv)
contain the undertaking of such Person to provide all such
information and materials and take all action as may be required
in order to permit the Partnership to comply with all applicable
requirements in connection with the registration of such
Partnership Securities.
7.13 Reliance by Third Parties
Notwithstanding anything to the contrary in this Agreement,
any Person dealing with the Partnership shall be entitled to
assume that the General Partner and any officer of the General
Partner authorized by the General Partner to act on behalf of and
in the name of the Partnership has full power and authority to
encumber, sell or otherwise use in any manner any and all assets
of the Partnership and to enter into any authorized contracts on
behalf of the Partnership, and such Person shall be entitled to
deal with the General Partner or any such officer as if it were
the Partnership's sole party in interest, both legally and
beneficially. Each Limited Partner hereby waives any and all
defenses or other remedies that may be available against such
Person to contest, negate or disaffirm any action of the General
Partner or any such officer in connection with any such dealing.
In no event shall any Person dealing with the General Partner or
any such officer or its representatives be obligated to ascertain
that the terms of the Agreement have been complied with or to
inquire into the necessity or expedience of any act or action of
the General Partner or any such officer or its representatives.
Each and every certificate, document or other instrument executed
on behalf of the Partnership by the General Partner or its
representatives shall be conclusive evidence in favor of any and
every Person relying thereon or claiming thereunder that (a) at
the time of the execution and delivery of such certificate,
document or instrument, this Agreement was in full force and
effect, (b) the Person executing and delivering such certificate,
document or instrument was duly authorized and empowered to do so
for and on behalf of the Partnership and (c) such certificate,
document or instrument was duly executed and delivered in
accordance with the terms and provisions of this Agreement and is
binding upon the Partnership.
ARTICLE VIII
Books, Records, Accounting and Reports
8.1 Records and Accounting
The General Partner shall keep or cause to be kept at the
principal office of the Partnership, appropriate books and
records with respect to the Partnership's business, including all
books and records necessary to provide to the Limited Partners
any information required to be provided pursuant to Section
3.4(a). Any books and records maintained by or on behalf of the
Partnership in the regular course of its business, including the
record of the Record Holders and Assignees of Units or other
Partnership Securities, books of account and records of
Partnership proceedings, may be kept on, or be in the form of,
computer disks, hard drives, punch cards, magnetic tape,
photographs, micrographics or any other information storage
device; provided, that the books and records so maintained are
convertible into clearly legible written form within a reasonable
period of time. The books of the Partnership shall be maintained,
for financial reporting purposes, on an accrual basis in
accordance with U.S. GAAP.
8.2 Fiscal Year
The fiscal year of the Partnership shall be the calendar
year.
8.3 Reports
(a) As soon as practicable, but in no event later than 120
days after the close of each fiscal year of the Partnership, the
General Partner shall cause to be mailed or furnished to each
Record Holder of a Limited Partner Interest as of a date selected
by the General Partner in its discretion, an annual report
containing financial statements of the Partnership for such
fiscal year of the Partnership, presented in accordance with U.S.
GAAP, including a balance sheet and statements of operations,
Partnership equity and cash flows, such statements to be audited
by a firm of independent public accountants selected by the
General Partner.
(b) As soon as practicable, but in no event later than 90
days after the close of each Quarter except the last Quarter of
each year, the General Partner shall cause to be mailed or
furnished to each Record Holder of a Limited Partner Interest, as
of a date selected by the General Partner in its discretion, a
report containing unaudited financial statements of the
Partnership and such other information as may be required by
applicable law, regulation or rule of any National Securities
Exchange on which Limited Partner Interests are listed for
trading, or as the General Partner determines to be necessary or
appropriate.
ARTICLE IX
Tax Matters
9.1 Tax Returns and Information
The Partnership shall timely file all returns of the
Partnership that are required for federal, state and local income
tax purposes on the basis of the accrual method and a taxable
year ending on December 31. The tax information reasonably
required by Record Holders for federal and state income tax
reporting purposes with respect to a taxable year shall be
furnished to them within 90 days of the close of the calendar
year in which the Partnership's taxable year ends. The
classification, realization and recognition of income, gain,
losses and deductions and other items shall be on the accrual
method of accounting for federal income tax purposes.
9.2 Tax Elections
(a) The Partnership has made the election under Section 754
of the Code in accordance with applicable regulations thereunder,
subject to the reservation of the right to seek to revoke any
such election upon the General Partner's determination that such
revocation is in the best interests of the Limited Partners.
Notwithstanding any other provision herein contained, for the
purposes of computing the adjustments under Section 743(b) of the
Code, the General Partner shall be authorized (but not required)
to adopt a convention whereby the price paid by a transferee of a
Limited Partner Interest will be deemed to be the lowest quoted
closing price of such Limited Partner Interests on any National
Securities Exchange on which such Limited Partner Interests are
traded during the calendar month in which such transfer is deemed
to occur pursuant to Section 6.2(g) without regard to the actual
price paid by such transferee.
(b) The Partnership has elected to deduct expenses incurred
in organizing the Partnership ratably over a sixty-month period
as provided in Section 709 of the Code.
(c) Except as otherwise provided herein, the General
Partner shall determine whether the Partnership should make any
other elections permitted by the Code.
9.3 Tax Controversies
Subject to the provisions hereof, the General Partner is
designated as the Tax Matters Partner (as defined in the Code)
and is authorized and required to represent the Partnership (at
the Partnership's expense) in connection with all examinations of
the Partnership's affairs by tax authorities, including resulting
administrative and judicial proceedings, and to expend
Partnership funds for professional services and costs associated
therewith. Each Partner agrees to cooperate with the General
Partner and to do or refrain from doing any or all things
reasonably required by the General Partner to conduct such
proceedings.
9.4 Withholding
Notwithstanding any other provision of this Agreement, the
General Partner is authorized to take any action that it
determines in its discretion to be necessary or appropriate to
cause the Partnership to comply with any withholding requirements
established under the Code or any other federal, state or local
law including, without limitation, pursuant to Sections 1441,
1442, 1445 and 1446 of the Code. To the extent that the
Partnership is required or elects to withhold and pay over to any
taxing authority any amount resulting from the allocation or
distribution of income to any Partner or Assignee (including,
without limitation, by reason of Section 1446 of the Code), the
amount withheld may at the discretion of the General Partner be
treated by the Partnership as a distribution of cash pursuant to
Section 6.3 in the amount of such withholding from such Partner.
ARTICLE X
Admission of Partners
10.1 Admission of Substituted Limited Partner
By transfer of a Limited Partner Interest in accordance with
Article IV, the transferor shall be deemed to have given the
transferee the right to seek admission as a Substituted Limited
Partner subject to the conditions of, and in the manner permitted
under, this Agreement. A transferor of a Certificate representing
a Limited Partner Interest shall, however, only have the
authority to convey to a purchaser or other transferee who does
not execute and deliver a Transfer Application (a) the right to
negotiate such Certificate to a purchaser or other transferee and
(b) the right to transfer the right to request admission as a
Substituted Limited Partner to such purchaser or other transferee
in respect of the transferred Limited Partner Interests. Each
transferee of a Limited Partner Interest (including any nominee
holder or an agent acquiring such Limited Partner Interest for
the account of another Person) who executes and delivers a
Transfer Application shall, by virtue of such execution and
delivery, be an Assignee and be deemed to have applied to become
a Substituted Limited Partner with respect to the Limited Partner
Interest so transferred to such Person. Such Assignee shall
become a Substituted Limited Partner (x) at such time as the
General Partner consents thereto, which consent may be given or
withheld in the General Partner's discretion, and (y) when any
such admission is shown on the books and records of the
Partnership. If such consent is withheld, such transferee shall
be an Assignee. An Assignee shall have an interest in the
Partnership equivalent to that of a Limited Partner with respect
to allocations and distributions, including liquidating
distributions, of the Partnership. With respect to voting rights
attributable to Limited Partner Interests that are held by
Assignees, the General Partner shall be deemed to be the Limited
Partner with respect thereto and shall, in exercising the voting
rights in respect of such Limited Partner Interests on any
matter, vote such Limited Partner Interests at the written
direction of the Assignee who is the Record Holder of such
Limited Partner Interests. If no such written direction is
received, such Limited Partner Interests will not be voted. An
Assignee shall have no other rights of a Limited Partner.
10.2 Admission of Successor General Partner
A successor General Partner approved pursuant to Section
11.1 or 11.2 or the transferee of or successor to all of the
General Partner Interest pursuant to Section 4.6 who is proposed
to be admitted as a successor General Partner shall be admitted
to the Partnership as the General Partner, effective immediately
prior to the withdrawal or removal of the General Partner
pursuant to Section 11.1 or 11.2 or the transfer of the General
Partner Interest pursuant to Section 4.6; provided, however, that
no such successor shall be admitted to the Partnership until
compliance with the terms of Section 4.6 has occurred and such
successor has executed and delivered such other documents or
instruments as may be required to effect such admission. Any such
successor shall, subject to the terms hereof, carry on the
business of the Group Members without dissolution.
10.3 Admission of Additional Limited Partners
(a) A Person (other than the General Partner or a
Substituted Limited Partner) who makes a Capital Contribution to
the Partnership in accordance with this Agreement in exchange for
Limited Partner Interests shall be admitted to the Partnership as
an Additional Limited Partner only upon furnishing to the General
Partner (i) evidence of acceptance in form satisfactory to the
General Partner of all of the terms and conditions of this
Agreement, including the power of attorney granted in Section
2.6, and (ii) such other documents or instruments as may be
required in the discretion of the General Partner to effect such
Person's admission as an Additional Limited Partner.
(b) Notwithstanding anything to the contrary in this
Section 10.4, no Person shall be admitted as an Additional
Limited Partner without the consent of the General Partner, which
consent may be given or withheld in the General Partner's
discretion. The admission of any Person as an Additional Limited
Partner shall become effective on the date upon which the name of
such Person is recorded as such in the books and records of the
Partnership, following the consent of the General Partner to such
admission.
10.4 Amendment of Agreement and Certificate of Limited
Partnership
To effect the admission to the Partnership of any Partner,
the General Partner shall take all steps necessary and
appropriate under the Delaware Act to amend the records of the
Partnership to reflect such admission and, if necessary, to
prepare as soon as practicable an amendment to this Agreement
and, if required by law, the General Partner shall prepare and
file an amendment to the Certificate of Limited Partnership, and
the General Partner may for this purpose, among others, exercise
the power of attorney granted pursuant to Section 2.6.
ARTICLE XI
Withdrawal or Removal of Partners
11.1 Withdrawal of the General Partner
(a) The General Partner shall be deemed to have withdrawn
from the Partnership upon the occurrence of any one of the
following events (each such event herein referred to as an "Event
of Withdrawal");
(i) the General Partner voluntarily withdraws from the
Partnership by giving written notice to the Limited Partners
(and it shall be deemed that the General Partner has
withdrawn pursuant to this Section 11.1(a)(i) if the General
Partner voluntarily withdraws as a general partner of
Genesis OLP);
(ii) the General Partner transfers all of its General
Partner Interest pursuant to Section 4.6;
(iii) the General Partner is removed pursuant to Section
11.2;
(iv) the General Partner (A) makes a general assignment
for the benefit of creditors; (B) files a voluntary
bankruptcy petition for relief under Chapter 7 of the United
States Bankruptcy Code; (C) files a petition or answer
seeking for itself a liquidation, dissolution or similar
relief (but not a reorganization) under any law; (D) files
an answer or other pleading admitting or failing to contest
the material allegations of a petition filed against the
General Partner in a proceeding of the type described in
clauses (A)-(C) of this Section 11.1(a)(iv); or (E) seeks,
consents to or acquiesces in the appointment of a trustee
(but not a debtor in possession), receiver or liquidator of
the General Partner or of all or any substantial part of its
properties;
(v) a final and non-appealable order of relief under
Chapter 7 of the United States Bankruptcy Code is entered by
a court with appropriate jurisdiction pursuant to a
voluntary or involuntary petition by or against the General
Partner; or
(vi) (A) in the event the General Partner is a
corporation, a certificate of dissolution or its equivalent
is filed for the General Partner, or 90 days expire after
the date of notice to the General Partner of revocation of
its charter without a reinstatement of its charter, under
the laws of its state of incorporation; (B) in the event the
General Partner is a partnership or a limited liability
company, the dissolution and commencement of winding up of
the General Partner; (C) in the event the General Partner is
acting in such capacity by virtue of being a trustee of a
trust, the termination of the trust; (D) in the event the
General Partner is a natural person, his death or
adjudication of incompetency; and (E) otherwise in the event
of the termination of the General Partner.
If an Event of Withdrawal specified in Section 11.1(a)(iv), (v)
or (vi)(A), (B), (C) or (E) occurs, the withdrawing General
Partner shall give notice to the Limited Partners within 30 days
after such occurrence. The Partners hereby agree that only the
Events of Withdrawal described in this Section 11.1 shall result
in the withdrawal of the General Partner from the Partnership.
(b) Withdrawal of the General Partner from the Partnership
upon the occurrence of an Event of Withdrawal shall not
constitute a breach of this Agreement under the following
circumstances: (i) at any time during the period beginning on the
Initial Closing Date and ending at 12:00 midnight, Eastern
Standard Time, on December 31, 2006, the General Partner
voluntarily withdraws by giving at least 90 days' advance notice
of its intention to withdraw to the Limited Partners; provided
that prior to the effective date of such withdrawal, the
withdrawal is approved by the holders of a Majority Interest and
the General Partner delivers to the Partnership an Opinion of
Counsel ("Withdrawal Opinion of Counsel") that such withdrawal
(following the selection of the successor General Partner) would
not result in the loss of the limited liability of any Limited
Partner or any limited partner of Genesis OLP or cause the
Partnership or Genesis OLP to be treated as an association
taxable as a corporation or otherwise to be taxed as an entity
for federal income tax purposes (to the extent not previously
treated as such); (ii) at any time after 12:00 midnight, Eastern
Standard Time, on December 31, 2006, the General Partner
voluntarily withdraws by giving at least 90 days' advance notice
to the Limited Partners, such withdrawal to take effect on the
date specified in such notice; (iii) at any time that the General
Partner ceases to be the General Partner pursuant to Section
11.1(a)(ii) or is removed pursuant to Section 11.2; or
(iv) notwithstanding clause (i) of this sentence, at any time
that the General Partner voluntarily withdraws by giving at least
90 days' advance notice of its intention to withdraw to the
Limited Partners, such withdrawal to take effect on the date
specified in the notice, if at the time such notice is given one
Person and its Affiliates (other than the General Partner and its
Affiliates) own beneficially or of record or control at least 50%
of the Outstanding Limited Partner Interests. The withdrawal of
the General Partner from the Partnership upon the occurrence of
an Event of Withdrawal shall also constitute the withdrawal of
the General Partner as general partner or managing member of the
other Group Members. If the General Partner gives a notice of
withdrawal pursuant to Section 11.1(a)(i), the holders of a
Majority Interest, may, prior to the effective date of such
withdrawal, elect a successor General Partner. The Person so
elected as successor General Partner shall automatically become a
successor general partner or managing member of the other Group
Members of which the General Partner is a general partner. If,
prior to the effective date of the General Partner's withdrawal,
a successor is not selected by the Limited Partners as provided
herein or the Partnership does not receive a Withdrawal Opinion
of Counsel, the Partnership shall be dissolved in accordance with
Section 12.1. Any successor General Partner elected in accordance
with the terms of this Section 11.1 shall be subject to the
provisions of Section 10.3.
11.2 Removal of the General Partner
The General Partner may not be removed without Cause. If
Cause exists the General Partner may be removed if such removal
is approved by the holders of a Two-Thirds Interest (including
Limited Partner Interests held by the General Partner and its
Affiliates). Any such action by such holders for removal of the
General Partner must also provide for the election of a successor
General Partner by the holders of a Two-Thirds Interest
(including Limited Partner Interests held by the General Partner
and its Affiliates). Such removal shall be effective immediately
following the admission of a successor General Partner pursuant
to Section 10.3. The removal of the General Partner shall also
automatically constitute the removal of the General Partner as
general partner of the other Group Members of which the General
Partner is a general partner. If a Person is elected as a
successor General Partner in accordance with the terms of this
Section 11.2, such Person shall, upon admission pursuant to
Section 10.3, automatically become a successor general partner or
managing member of the other Group Members of which the General
Partner is a general partner. The right of the Limited Partners
to remove the General Partner pursuant to this Section 11.2 shall
not exist or be exercised unless the Partnership has received an
opinion opining as to the matters covered by a Withdrawal Opinion
of Counsel. Any successor General Partner elected in accordance
with the terms of this Section 11.2 shall be subject to the
provisions of Section 10.3.
11.3 Interest of Departing Partner and Successor General Partner
(a) In the event of the withdrawal of the General Partner
under circumstances where such withdrawal does not violate this
Agreement, if a successor General Partner is elected in
accordance with the terms of Section 11.1 or 11.2, the Departing
Partner shall have the option exercisable prior to the effective
date of the departure of such Departing Partner to require its
successor to purchase its General Partner Interest and its
partnership interest as a general partner or managing member in
the other Group Members and if the General Partner has delivered
a Conversion Election as provided in Section 7.13 of the Genesis
OLP Partnership Agreement, its right to participate in
distributions as provided in Section 7.13 of the Genesis OLP
Partnership Agreement (collectively, the "Combined Interest") in
exchange for an amount in cash equal to the fair market value of
such Combined Interest, such amount to be determined and payable
as of the effective date of its departure. If the General Partner
is removed by the Partners under circumstances where Cause exists
or if the General Partner withdraws under circumstances where
such withdrawal violates this Agreement or the Genesis OLP
Partnership Agreement, and if a successor General Partner is
elected in accordance with the terms of Section 11.1 or 11.2,
such successor shall have the option, exercisable prior to the
effective date of the departure of such Departing Partner, to
purchase the Combined Interest of the Departing Partner for such
fair market value of such Combined Interest. In either event, the
Departing Partner shall be entitled to receive all reimbursements
due such Departing Partner pursuant to Section 7.4, including any
employee-related liabilities (including severance liabilities),
incurred in connection with the termination of any employees
employed by the General Partner for the benefit of the
Partnership or the other Group Members.
For purposes of this Section 11.3(a), the fair market value
of the Departing Partner's Combined Interest shall be determined
by agreement between the Departing Partner and its successor or,
failing agreement within 30 days after the effective date of such
Departing Partner's departure, by an independent investment
banking firm or other independent expert selected by the
Departing Partner and its successor, which, in turn, may rely on
other experts, and the determination of which shall be conclusive
as to such matter. If such parties cannot agree upon one
independent investment banking firm or other independent expert
within 45 days after the effective date of such departure, then
the Departing Partner shall designate an independent investment
banking firm or other independent expert, the Departing Partner's
successor shall designate an independent investment banking firm
or other independent expert, and such firms or experts shall
mutually select a third independent investment banking firm or
independent expert, which third independent investment banking
firm or other independent expert shall determine the fair market
value of the Combined Interest. In making its determination, such
third independent investment banking firm or other independent
expert may consider the then current trading price of Common
Units on any National Securities Exchange on which Common Units
are then listed, the value of the Partnership's assets, the
rights and obligations of the General Partner and other factors
it may deem relevant.
(b) If the Combined Interest is not purchased in the manner
set forth in Section 11.3(a), the Departing Partner will have the
right to convert the Combined Interest into Common Units or to
receive cash from the Partnership in exchange for such Combined
Interest. The Departing Partner's Combined Interest shall be
converted into Common Units pursuant to a valuation made by an
investment banking firm or other independent expert selected
pursuant to Section 11.3(a), without reduction in such Combined
Interest (but subject to proportionate dilution by reason of the
admission of its successor). Any successor General Partner shall
indemnify the Departing Partner as to all debts and liabilities
of the Partnership arising on or after the date on which the
Departing Partner becomes a Limited Partner. For purposes of this
Agreement, conversion of the General Partner's Combined Interest
to Common Units will be characterized as if the General Partner
contributed its Combined Interest to the Partnership in exchange
for the newly issued Common Units.
(c) If a successor General Partner is elected in accordance
with the terms of Section 11.1 or 11.2 and the option described
in Section 11.3(a) is not exercised by the party entitled to do
so, the successor General Partner shall, at the effective date of
its admission to the Partnership, contribute to the Partnership
cash in the amount necessary to acquire a General Partner
Interest equal to the General Partner Interest of the Departing
Partner. In such event, such successor General Partner shall be
entitled to such Percentage Interest of all Partnership
allocations and distributions and any other allocations and
distributions to which the Departing Partner was entitled.
11.4 Withdrawal of Limited Partners
No Limited Partner shall have any right to withdraw from the
Partnership; provided, however, that when a transferee of a
Limited Partner's Limited Partner Interest becomes a Record
Holder of the Limited Partner Interest so transferred, such
transferring Limited Partner shall cease to be a Limited Partner
with respect to the Limited Partner Interest so transferred.
ARTICLE XII
Dissolution and Liquidation
12.1 Dissolution
The Partnership shall not be dissolved by the admission of
Substituted Limited Partners or Additional Limited Partners or by
the admission of a successor General Partner in accordance with
the terms of this Agreement. Upon the removal or withdrawal of
the General Partner, if a successor General Partner is elected
pursuant to Section 11.1 or 11.2, the Partnership shall not be
dissolved and such successor General Partner shall continue the
business of the Partnership. The Partnership shall dissolve, and
(subject to Section 12.2) its affairs shall be wound up, upon:
(a) the expiration of its term as provided in Section 2.7;
(b) an Event of Withdrawal of the General Partner as
provided in Section 11.1(a) (other than Section 11.1(a)(ii)),
unless a successor is elected and an Opinion of Counsel is
received as provided in Section 11.1(b) or 11.2 and such
successor is admitted to the Partnership pursuant to Section
10.3;
(c) an election to dissolve the Partnership by the General
Partner that is approved by the holders of a Majority Interest;
(d) the entry of a decree of judicial dissolution of the
Partnership pursuant to the provisions of the Delaware Act;
(e) the dissolution of Genesis OLP; or
(f) the sale of all or substantially all of the assets and
properties of the Partnership Group.
12.2 Continuation of the Business of the Partnership After
Dissolution
Upon (a) dissolution of the Partnership following an Event
of Withdrawal caused by the withdrawal or removal of the General
Partner as provided in Section 11.1(a)(i) or (iii) and the
failure of the Partners to select a successor to such Departing
Partner pursuant to Section 11.1 or 11.2, then within 90 days
thereafter, or (b) dissolution of the Partnership upon an event
constituting an Event of Withdrawal as defined in Section
11.1(a)(iv), (v) or (vi), then, to the maximum extent permitted
by law, within 180 days thereafter, the holders of a Majority
Interest may elect to reconstitute the Partnership and continue
its business on the same terms and conditions set forth in this
Agreement by forming a new limited partnership on terms identical
to those set forth in this Agreement and having as the successor
general partner a Person approved by the holders of a Majority
Interest. Unless such an election is made within the applicable
time period as set forth above, the Partnership shall conduct
only activities necessary to wind up its affairs. If such an
election is so made, then:
(i) the reconstituted Partnership shall continue until
the end of the term set forth in Section 2.7 unless earlier
dissolved in accordance with this Article XII;
(ii) if the successor General Partner is not the
former General Partner, then the interest of the former
General Partner shall be treated in the manner provided in
Section 11.3; and
(iii) all necessary steps shall be taken to cancel this
Agreement and the Certificate of Limited Partnership and to
enter into and, as necessary, to file a new partnership
agreement and certificate of limited partnership, and the
successor general partner may for this purpose exercise the
powers of attorney granted the General Partner pursuant to
Section 2.6; provided, that the right of the holders of a
Majority Interest to approve a successor General Partner and
to reconstitute and to continue the business of the
Partnership shall not exist and may not be exercised unless
the Partnership has received an Opinion of Counsel that (x)
the exercise of the right would not result in the loss of
limited liability of any Limited Partner and (y) neither the
Partnership, the reconstituted limited partnership, Genesis
OLP nor any Group Member would be treated as an association
taxable as a corporation or otherwise be taxable as an
entity for federal income tax purposes upon the exercise of
such right to continue.
12.3 Liquidator
Upon dissolution of the Partnership, unless the Partnership
is continued under an election to reconstitute and continue the
Partnership pursuant to Section 12.2, the General Partner shall
select one or more Persons to act as Liquidator. The Liquidator
(if other than the General Partner) shall be entitled to receive
such compensation for its services as may be approved by the
holders of a Majority Interest. The Liquidator (if other than the
General Partner) shall agree not to resign at any time without 15
days' prior notice and may be removed at any time, with or
without cause, by notice of removal approved by the holders of a
Majority Interest. Upon dissolution, removal or resignation of
the Liquidator, a successor and substitute Liquidator (who shall
have and succeed to all rights, powers and duties of the original
Liquidator) shall within 30 days thereafter be approved by the
holders of a Majority Interest. The right to approve a successor
or substitute Liquidator in the manner provided herein shall be
deemed to refer also to any such successor or substitute
Liquidator approved in the manner herein provided. Except as
expressly provided in this Article XII, the Liquidator approved
in the manner provided herein shall have and may exercise,
without further authorization or consent of any of the parties
hereto, all of the powers conferred upon the General Partner
under the terms of this Agreement (but subject to all of the
applicable limitations, contractual and otherwise, upon the
exercise of such powers, other than the limitation on sale set
forth in Section 7.3(b)) to the extent necessary or desirable in
the good faith judgment of the Liquidator to carry out the duties
and functions of the Liquidator hereunder for and during such
period of time as shall be reasonably required in the good faith
judgment of the Liquidator to complete the winding up and
liquidation of the Partnership as provided for herein.
12.4 Liquidation
The Liquidator shall proceed to dispose of the assets of the
Partnership, discharge its liabilities, and otherwise wind up its
affairs in such manner and over such period as the Liquidator
determines to be in the best interest of the Partners, subject to
Section 17-804 of the Delaware Act and the following:
(a) Disposition of Assets. The assets may be disposed of by
public or private sale or by distribution in kind to one or more
Partners on such terms as the Liquidator and such Partner or
Partners may agree. If any property is distributed in kind, the
Partner receiving the property shall be deemed for purposes of
Section 12.4(c) to have received cash equal to its fair market
value; and contemporaneously therewith, appropriate cash
distributions must be made to the other Partners. The Liquidator
may, in its absolute discretion, defer liquidation or
distribution of the Partnership's assets for a reasonable time if
it determines that an immediate sale of all or some of the
Partnership's assets would be impractical or would cause undue
loss to the partners. The Liquidator may, in its absolute
discretion, distribute the Partnership's assets, in whole or in
part, in kind if it determines that a sale would be impractical
or would cause undue loss to the partners.
(b) Discharge of Liabilities. Liabilities of the
Partnership include amounts owed to Partners otherwise than in
respect of their distribution rights under Article VI. With
respect to any liability that is contingent, conditional or
unmatured or is otherwise not yet due and payable, the Liquidator
shall either settle such claim for such amount as it thinks
appropriate or establish a reasonable reserve of cash or other
assets to provide for its payment. When paid, any unused portion
of the reserve shall be distributed as additional liquidation
proceeds.
(c) Liquidation Distributions. All property and all cash in
excess of that required to discharge liabilities as provided in
Section 12.4(b) shall be distributed to the Partners in
accordance with, and to the extent of, the positive balances in
their respective Capital Accounts, as determined after taking
into account all Capital Account adjustments (other than those
made by reason of distributions pursuant to this Section 12.4(c))
for the taxable year of the Partnership during which the
liquidation of the Partnership occurs (with such date of
occurrence being determined pursuant to Treasury Regulation
Section 1.704-1(b)(2)(ii)(g)), and such distribution shall be
made by the end of such taxable year (or, if later, within 90
days after said date of such occurrence).
12.5 Cancellation of Certificate of Limited Partnership
Upon the completion of the distribution of Partnership cash
and property as provided in Section 12.4 in connection with the
liquidation of the Partnership, the Partnership shall be
terminated and the Certificate of Limited Partnership and all
qualifications of the Partnership as a foreign limited
partnership in jurisdictions other than the State of Delaware
shall be canceled and such other actions as may be necessary to
terminate the Partnership shall be taken.
12.6 Return of Contributions
The General Partner shall not be personally liable for, and
shall have no obligation to contribute or loan any monies or
property to the Partnership to enable it to effectuate, the
return of the Capital Contributions of the Limited Partners, or
any portion thereof, it being expressly understood that any such
return shall be made solely from Partnership assets.
12.7 Waiver of Partition
To the maximum extent permitted by law, each Partner hereby
waives any right to partition of the Partnership property.
12.8 Capital Account Restoration
No Limited Partner shall have any obligation to restore any
negative balance in its Capital Account upon liquidation of the
Partnership. The General Partner shall be obligated to restore
any negative balance in its Capital Account upon liquidation of
its interest in the Partnership by the end of the taxable year of
the Partnership during which such liquidation occurs, or, if
later, within 90 days after the date of such liquidation.
ARTICLE XIII
Amendment of Partnership Agreement; Meetings; Record Date
13.1 Amendment to be Adopted Solely by the General Partner
Each Partner agrees that the General Partner, without the
approval of any Partner or Assignee, may amend any provision of
this Agreement and execute, swear to, acknowledge, deliver, file
and record whatever documents may be required in connection
therewith, to reflect:
(a) a change in the name of the Partnership, the location
of the principal place of business of the Partnership, the
registered agent of the Partnership or the registered office of
the Partnership;
(b) admission, substitution, withdrawal or removal of
Partners in accordance with this Agreement;
(c) a change that, in the sole discretion of the General
Partner, is necessary or advisable to qualify or continue the
qualification of the Partnership as a limited partnership or a
partnership in which the Limited Partners have limited liability
under the laws of any state or to ensure that no Group Member
will be treated as an association taxable as a corporation or
otherwise taxed as an entity for federal income tax purposes;
(d) a change that, in the discretion of the General
Partner, (i) does not adversely affect the Limited Partners in
any material respect, (ii) is necessary or advisable (A) to
satisfy any requirements, conditions or guidelines contained in
any opinion, directive, order, ruling or regulation of any
federal or state agency or judicial authority or contained in any
federal or state statute (including the Delaware Act), (B) to
facilitate the trading of Limited Partner Interests (including
the division of any class or classes of Outstanding Limited
Partner Interests into different classes to facilitate uniformity
of tax consequences within such classes of Limited Partner
Interests) or comply with any rule, regulation, guideline or
requirement of any National Securities Exchange on which Limited
Partner Interests are or will be listed for trading, compliance
with any of which the General Partner determines in its
discretion to be in the best interests of the Partnership and the
Limited Partners or (C) in connection with action taken by the
General Partner pursuant to Section 5.7, or (iii) is required to
effect the intent expressed in the Registration Statement or the
Proxy Statement or the intent of the provisions of this Agreement
or is otherwise contemplated by this Agreement;
(e) a change in the fiscal year or taxable year of the
Partnership and any changes that, in the discretion of the
General Partner, are necessary or advisable as a result of a
change in the fiscal year or taxable year of the Partnership
including, if the General Partner shall so determine, a change in
the definition of "Quarter" and the dates on which distributions
are to be made by the Partnership;
(f) an amendment that is necessary, in the Opinion of
Counsel, to prevent the Partnership or the General Partner or its
directors, officers, trustees or agents from in any manner being
subjected to the provisions of the Investment Company Act of
1940, as amended, the Investment Advisers Act of 1940, as
amended, or "plan asset" regulations adopted under the Employee
Retirement Income Security Act of 1974, as amended, regardless of
whether such are substantially similar to plan asset regulations
currently applied or proposed by the United States Department of
Labor;
(g) an amendment that, in the discretion of the General
Partner, is necessary or advisable in connection with the
authorization of issuance of any class or series of Partnership
Securities pursuant to Section 5.5;
(h) any amendment expressly permitted in this Agreement to
be made by the General Partner acting alone;
(i) an amendment effected, necessitated or contemplated by
a Merger Agreement approved in accordance with Section 14.3;
(j) an amendment that, in the discretion of the General
Partner, is necessary or advisable to reflect, account for and
deal with appropriately the formation by the Partnership of, or
investment by the Partnership in, any corporation, partnership,
joint venture, limited liability company or other entity, in
connection with the conduct by the Partnership of activities
permitted by the terms of Section 2.4;
(k) a merger or conveyance pursuant to Section 14.3(d); or
(l) any other amendments substantially similar to the
foregoing.
13.2 Amendment Procedures
Except as provided in Sections 13.1 and 13.3, all amendments
to this Agreement shall be made in accordance with the following
requirements. Amendments to this Agreement may be proposed only
by or with the consent of the General Partner, which consent may
be given or withheld in its sole discretion. A proposed amendment
shall be effective upon its approval by the holders of a Majority
Interest, unless a greater or different percentage is required
under this Agreement or by Delaware law. Each proposed amendment
that requires the approval of the holders of a specified
percentage of Outstanding Limited Partner Interests shall be set
forth in a writing that contains the text of the proposed
amendment. If such an amendment is proposed, the General Partner
shall seek the written approval of the requisite percentage of
Outstanding Limited Partner Interests or call a meeting of the
Limited Partners to consider and vote on such proposed amendment.
The General Partner shall notify all Record Holders upon final
adoption of any such proposed amendments.
13.3 Amendment Requirements
(a) Notwithstanding the provisions of Sections 13.1 and
13.2, no provision of this Agreement that establishes a
percentage of Outstanding Limited Partner Interests (including
Limited Partner Interests deemed owned by the General Partner)
required to take any action shall be amended, altered, changed,
repealed or rescinded in any respect that would have the effect
of reducing such voting percentage unless such amendment is
approved by the written consent or the affirmative vote of
holders of Outstanding Limited Partner Interests (including
Limited Partner Interests deemed owned by the General Partner)
whose aggregate Outstanding Limited Partner Interests constitute
not less than the voting requirement sought to be reduced.
(b) Notwithstanding the provisions of Sections 13.1 and
13.2, no amendment to this Agreement may (i) enlarge the
obligations of any Limited Partner without its consent, unless
such shall be deemed to have occurred as a result of an amendment
approved pursuant to Section 13.3(c), (ii) enlarge the
obligations of, restrict in any way any action by or rights of,
or reduce in any way the amounts distributable, reimbursable or
otherwise payable to, the General Partner or any of its
Affiliates without its consent, which may be given or withheld in
its sole discretion, (iii) change Section 12.1(a) or 12.1(c), or
(iv) change the term of the Partnership or, except as set forth
in Section 12.1(c) or 12.1(e), give any Person the right to
dissolve the Partnership.
(c) Except as provided in Section 14.3, and except as
otherwise provided, and without limitation of the General
Partner's authority to adopt amendments to this Agreement as
contemplated in Section 13.1, any amendment that would have a
material adverse effect on the rights or preferences of any class
of Partnership Interests in relation to other classes of
Partnership Interests must be approved by the holders of not less
than a majority of the Outstanding Partnership Interests of the
class affected.
(d) Notwithstanding any other provision of this Agreement,
except for amendments pursuant to Section 7.3 or 13.1 and except
as otherwise provided by Section 14.3(b), no amendments shall
become effective without the approval of the holders of a Ninety
Percent Interest unless the Partnership obtains an Opinion of
Counsel to the effect that such amendment will not affect the
limited liability of any Limited Partner under applicable law.
(e) Except as provided in Section 13.1, this Section 13.3
shall only be amended with the approval of the holders of a
Ninety Percent Interest.
13.4 Special Meetings
All acts of Limited Partners to be taken pursuant to this
Agreement shall be taken in the manner provided in this Article
XIII. Special meetings of the Limited Partners may be called by
the General Partner or by Limited Partners owning 20% or more of
the Outstanding Limited Partner Interests of the class or classes
for which a meeting is proposed and which are entitled to vote
thereat. Limited Partners shall call a special meeting by
delivering to the General Partner one or more requests in writing
stating that the signing Limited Partners wish to call a special
meeting and indicating the general or specific purposes for which
the special meeting is to be called. Within 60 days after receipt
of such a call from Limited Partners or within such greater time
as may be reasonably necessary for the Partnership to comply with
any statutes, rules, regulations, listing agreements or similar
requirements governing the holding of a meeting or the
solicitation of proxies for use at such a meeting, the General
Partner shall send a notice of the meeting to the Limited
Partners either directly or indirectly through the Transfer
Agent. A meeting shall be held at a time and place determined by
the General Partner on a date not less than 10 days nor more than
60 days after the mailing of notice of the meeting. Limited
Partners shall not vote on matters that would cause the Limited
Partners to be deemed to be taking part in the management and
control of the business and affairs of the Partnership so as to
jeopardize the Limited Partners' limited liability under the
Delaware Act or the law of any other state in which the
Partnership is qualified to do business.
13.5 Notice of a Meeting
Notice of a meeting called pursuant to Section 13.4 shall be
given to the Record Holders of the class or classes of Limited
Partner Interests for which a meeting is proposed in writing by
mail or other means of written communication in accordance with
Section 16.1. The notice shall be deemed to have been given at
the time when deposited in the mail or sent by other means of
written communication.
13.6 Record Date
For purposes of determining the Limited Partners entitled to
notice of or to vote at a meeting of the Limited Partners or to
give approvals without a meeting as provided in Section 13.11,
the General Partner may set a Record Date, which shall not be
less than 10 nor more than 60 days before (a) the date of the
meeting (unless such requirement conflicts with any rule,
regulation, guideline or requirement of any National Securities
Exchange on which Limited Partner Interests are listed for
trading, in which case the rule, regulation, guideline or
requirement of such exchange shall govern) or (b) in the event
that approvals are sought without a meeting, the date by which
Limited Partners are requested in writing by the General Partner
to give such approvals.
13.7 Adjournment
When a meeting is adjourned to another time or place, notice
need not be given of the adjourned meeting and a new Record Date
need not be fixed, if the time and place thereof are announced at
the meeting at which the adjournment is taken, unless such
adjournment shall be for more than 45 days. At the adjourned
meeting, the Partnership may transact any business which might
have been transacted at the original meeting. If the adjournment
is for more than 45 days or if a new Record Date is fixed for the
adjourned meeting, a notice of the adjourned meeting shall be
given in accordance with this Article XIII.
13.8 Waiver of Notice; Approval of Meeting; Approval of Minutes
The transactions of any meeting of Limited Partners, however
called and noticed, and whenever held, shall be as valid as if
occurred at a meeting duly held after regular call and notice, if
a quorum is present either in person or by proxy, and if, either
before or after the meeting, Limited Partners representing such
quorum who were present in person or by proxy and entitled to
vote, sign a written waiver of notice or an approval of the
holding of the meeting or an approval of the minutes thereof. All
waivers and approvals shall be filed with the Partnership records
or made a part of the minutes of the meeting. Attendance of a
Limited Partner at a meeting shall constitute a waiver of notice
of the meeting, except when the Limited Partner does not approve,
at the beginning of the meeting, of the transaction of any
business because the meeting is not lawfully called or convened;
and except that attendance at a meeting is not a waiver of any
right to disapprove the consideration of matters required to be
included in the notice of the meeting, but not so included, if
the disapproval is expressly made at the meeting.
13.9 Quorum
The holders of a majority of the Outstanding Limited Partner
Interests (including Limited Partner Interests deemed owned by
the General Partner) of the class or classes for which a meeting
has been called and which are entitled to vote represented in
person or by proxy shall constitute a quorum at a meeting of
Limited Partners of such class or classes unless any such action
by the Limited Partners requires approval by holders of a greater
percentage of such Limited Partner Interests, in which case the
quorum shall be such greater percentage. At any meeting of the
Limited Partners duly called and held in accordance with this
Agreement at which a quorum is present, the act of Limited
Partners holding Outstanding Limited Partner Interests (including
Limited Partner Interests deemed owned by the General Partner)
that in the aggregate represent a majority of the Outstanding
Limited Partner Interests (including Limited Partner Interests
deemed owned by the General Partner) entitled to vote and be
present in person or by proxy at such meeting shall be deemed to
constitute the act of all Limited Partners, unless a greater or
different percentage is required with respect to such action
under the provisions of this Agreement, in which case the act of
the Limited Partners holding Outstanding Limited Partner
Interests (including Limited Partner Interests deemed owned by
the General Partner) that in the aggregate represent at least
such greater or different percentage shall be required. The
Limited Partners present at a duly called or held meeting at
which a quorum is present may continue to transact business until
adjournment, notwithstanding the withdrawal of enough Limited
Partners to leave less than a quorum, if any action taken (other
than adjournment) is approved by the required percentage of
Outstanding Limited Partner Interests (including Limited Partner
Interests deemed owned by the General Partner) specified in this
Agreement. In the absence of a quorum any meeting of Limited
Partners may be adjourned from time to time by the affirmative
vote of holders of at least a majority of the Outstanding Limited
Partner Interests (including Limited Partner Interests deemed
owned by the General Partner) entitled to vote at such meeting
represented either in person or by proxy, but no other business
may be transacted, except as provided in Section 13.7.
13.10 Conduct of a Meeting
The General Partner shall have full power and authority
concerning the manner of conducting any meeting of the Partners
or solicitation of approvals in writing, including the
determination of Persons entitled to vote, the existence of a
quorum, the satisfaction of the requirements of Section 13.4, the
conduct of voting, the validity and effect of any proxies and the
determination of any controversies, votes or challenges arising
in connection with or during the meeting or voting. The General
Partner shall designate a Person to serve as chairman of any
meeting and shall further designate a Person to take the minutes
of any meeting. All minutes shall be kept with the records of the
Partnership maintained by the General Partner. The General
Partner may make such other regulations consistent with
applicable law and this Agreement as it may deem advisable
concerning the conduct of any meeting of the Partners or
solicitation of approvals in writing, including regulations in
regard to the appointment of proxies, the appointment and duties
of inspectors of votes and approvals, the submission and
examination of proxies and other evidence of the right to vote,
and the revocation of approvals in writing.
13.11 Action Without a Meeting
If authorized by the General Partner, any action that may be
taken at a meeting of the Limited Partners may be taken without a
meeting if an approval in writing setting forth the action so
taken is signed by Limited Partners owning not less than the
minimum percentage of the Outstanding Limited Partner Interests
(including Limited Partner Interests deemed owned by the General
Partner) that would be necessary to authorize or take such action
at a meeting at which all the Limited Partners were present and
voted (unless such provision conflicts with any rule, regulation,
guideline or requirement of any National Securities Exchange on
which Limited Partner Interests are listed for trading, in which
case the rule, regulation, guideline or requirement of such
exchange shall govern). Prompt notice of the taking of action
without a meeting shall be given to the Limited Partners who have
not approved in writing. The General Partner may specify that any
written ballot submitted to Limited Partners for the purpose of
taking any action without a meeting shall be returned to the
Partnership within the time period, which shall be not less than
20 days, specified by the General Partner. If a ballot returned
to the Partnership does not vote all of the Limited Partner
Interests held by a Limited Partner the Partnership shall be
deemed to have failed to receive a ballot for the Limited Partner
Interests that were not voted. If approval of the taking of any
action by the Limited Partners is solicited by any Person other
than by or on behalf of the General Partner, the written
approvals shall have no force and effect unless and until (a)
they are deposited with the Partnership in care of the General
Partner, (b) approvals sufficient to take the action proposed are
dated as of a date not more than 90 days prior to the date
sufficient approvals are deposited with the Partnership and (c)
an Opinion of Counsel is delivered to the General Partner to the
effect that the exercise of such right and the action proposed to
be taken with respect to any particular matter (i) will not cause
the Limited Partners to be deemed to be taking part in the
management and control of the business and affairs of the
Partnership so as to jeopardize the Limited Partners' limited
liability, and (ii) is otherwise permissible under the state
statutes then governing the rights, duties and liabilities of the
Partnership and the Partners.
13.12 Voting and Other Rights
(a) Only those Record Holders of the Limited Partner
Interests on the Record Date set pursuant to Section 13.6 (and
also subject to the limitations contained in the definition of
"Outstanding") shall be entitled to notice of, and to vote at, a
meeting of Limited Partners or to act with respect to matters as
to which the holders of the Outstanding Limited Partner Interests
have the right to vote or to act. All references in this
Agreement to votes of, or other acts that may be taken by, the
Outstanding Limited Partner Interests shall be deemed to be
references to the votes or acts of the Record Holders of such
Outstanding Limited Partner Interests.
(b) With respect to Limited Partner Interests that are held
for a Person's account by another Person (such as a broker,
dealer, bank, trust company or clearing corporation, or an agent
of any of the foregoing), in whose name such Limited Partner
Interests are registered, such other Person shall, in exercising
the voting rights in respect of such Limited Partner Interests on
any matter, and unless the arrangement between such Persons
provides otherwise, vote such Limited Partner Interests in favor
of, and at the direction of, the Person who is the beneficial
owner, and the Partnership shall be entitled to assume it is so
acting without further inquiry. The provisions of this Section
13.12(b) (as well as all other provisions of this Agreement) are
subject to the provisions of Section 4.3.
ARTICLE XIV
Merger
14.1 Authority
The Partnership may merge or consolidate with one or more
corporations, limited liability companies, business trusts or
associations, real estate investment trusts, common law trusts or
unincorporated businesses, including a general partnership or
limited partnership, formed under the laws of the State of
Delaware or any other state of the United States of America,
pursuant to a written agreement of merger or consolidation
("Merger Agreement") in accordance with this Article XIV.
14.2 Procedure for Merger or Consolidation
Merger or consolidation of the Partnership pursuant to this
Article XIV requires the prior approval of the General Partner.
If the General Partner shall determine, in the exercise of its
discretion, to consent to the merger or consolidation, the
General Partner shall approve the Merger Agreement, which shall
set forth:
(a) The names and jurisdictions of formation or
organization of each of the business entities proposing to merge
or consolidate;
(b) The name and jurisdiction of formation or organization
of the business entity that is to survive the proposed merger or
consolidation (the "Surviving Business Entity");
(c) The terms and conditions of the proposed merger or
consolidation;
(d) The manner and basis of exchanging or converting the
equity securities of each constituent business entity for, or
into, cash, property or general or limited partner interests,
rights, securities or obligations of the Surviving Business
Entity; and (i) if any general or limited partner interests,
securities or rights of any constituent business entity are not
to be exchanged or converted solely for, or into, cash, property
or general or limited partner interests, rights, securities or
obligations of the Surviving Business Entity, the cash, property
or general or limited partner interests, rights, securities or
obligations of any limited partnership, corporation, trust or
other entity (other than the Surviving Business Entity) which the
holders of such general or limited partner interests, securities
or rights are to receive in exchange for, or upon conversion of
their general or limited partner interests, securities or rights,
and (ii) in the case of securities represented by certificates,
upon the surrender of such certificates, which cash, property or
general or limited partner interests, rights, securities or
obligations of the Surviving Business Entity or any general or
limited partnership, corporation, trust or other entity (other
than the Surviving Business Entity), or evidences thereof, are to
be delivered;
(e) A statement of any changes in the constituent documents
or the adoption of new constituent documents (the articles or
certificate of incorporation, articles of trust, declaration of
trust, certificate or agreement of limited partnership,
certificate of formation or limited liability company agreement
or other similar charter or governing document) of the Surviving
Business Entity to be effected by such merger or consolidation;
(f) The effective time of the merger, which may be the date
of the filing of the certificate of merger pursuant to Section
14.4 or a later date specified in or determinable in accordance
with the Merger Agreement (provided, that if the effective time
of the merger is to be later than the date of the filing of the
certificate of merger, the effective time shall be fixed no later
than the time of the filing of the certificate of merger and
stated therein); and
(g) Such other provisions with respect to the proposed
merger or consolidation as are deemed necessary or appropriate by
the General Partner.
14.3 Approval by Limited Partners of Merger or Consolidation
(a) Except as provided in Section 14.3(d), the General
Partner, upon its approval of the Merger Agreement, shall direct
that the Merger Agreement be submitted to a vote of the Limited
Partners, whether at a special meeting or by written consent, in
either case in accordance with the requirements of Article XIII.
A copy or a summary of the Merger Agreement shall be included in
or enclosed with the notice of a special meeting or the written
consent.
(b) Except as provided in Section 14.3(d), the Merger
Agreement shall be approved upon receiving the affirmative vote
or consent of the holders of a Majority Interest unless the
Merger Agreement contains any provision that, if contained in an
amendment to this Agreement, the provisions of this Agreement or
the Delaware Act would require the vote or consent of a greater
percentage of the Outstanding Limited Partner Interests or of any
class of Limited Partners, in which case such greater percentage
vote or consent shall be required for approval of the Merger
Agreement.
(c) Except as provided in Section 14.3(d), after such
approval by vote or consent of the Limited Partners, and at any
time prior to the filing of the certificate of merger pursuant to
Section 14.4, the merger or consolidation may be abandoned
pursuant to provisions therefor, if any, set forth in the Merger
Agreement.
(d) Notwithstanding anything else contained in this Article
XIV or in this Agreement, the General Partner is permitted, in
its discretion, without Limited Partner approval, to merge the
Partnership or any Group Member into, or convey all of the
Partnership's assets to, another limited liability entity which
shall be newly formed and shall have no assets, liabilities or
operations at the time of such Merger other than those it
receives from the Partnership or other Group Member if (i) the
General Partner has received an Opinion of Counsel that the
merger or conveyance, as the case may be, would not result in the
loss of the limited liability of any Limited Partner or any
limited partner in Genesis OLP or cause the Partnership or
Genesis OLP to be treated as an association taxable as a
corporation or otherwise to be taxed as an entity for federal
income tax purposes (to the extent not previously treated as
such), (ii) the sole purpose of such merger or conveyance is to
effect a mere change in the legal form of the Partnership into
another limited liability entity and (iii) the governing
instruments of the new entity provide the Limited Partners and
the General Partner with the same rights and obligations as are
herein contained.
14.4 Certificate of Merger
Upon the required approval by the General Partner and the
Limited Partners of a Merger Agreement, a certificate of merger
shall be executed and filed with the Secretary of State of the
State of Delaware in conformity with the requirements of the
Delaware Act.
14.5 Effect of Merger
(a) At the effective time of the certificate of merger:
(i) all of the rights, privileges and powers of each
of the business entities that has merged or consolidated,
and all property, real, personal and mixed, and all debts
due to any of those business entities and all other things
and causes of action belonging to each of those business
entities shall be vested in the Surviving Business Entity
and after the merger or consolidation shall be the property
of the Surviving Business Entity to the extent they were of
each constituent business entity;
(ii) the title to any real property vested by deed or
otherwise in any of those constituent business entities
shall not revert and is not in any way impaired because of
the merger or consolidation;
(iii) all rights of creditors and all liens on or
security interests in property of any of those constituent
business entities shall be preserved unimpaired; and
(iv) all debts, liabilities and duties of those
constituent business entities shall attach to the Surviving
Business Entity, and may be enforced against it to the same
extent as if the debts, liabilities and duties had been
incurred or contracted by it.
(b) A merger or consolidation effected pursuant to this
Article XIV shall not be deemed to result in a transfer or
assignment of assets or liabilities from one entity to another.
ARTICLE XV
Right to Acquire Limited Partner Interests
15.1 Right to Acquire Limited Partner Interests
(a) Notwithstanding any other provision of this Agreement,
if at any time not more than 20% of the total Limited Partner
Interests of any class then Outstanding are held by Persons other
than the General Partner and its Affiliates, the General Partner
shall then have the right, which right it may assign and transfer
in whole or in part to the Partnership or any Affiliate of the
General Partner, exercisable in its sole discretion, to purchase
all, but not less than all, of such Limited Partner Interests of
such class then Outstanding held by Persons other than the
General Partner and its Affiliates, at the greater of (x) the
Current Market Price as of the date three days prior to the date
that the notice described in Section 15.1(b) is mailed and (y)
the highest price paid by the General Partner or any of its
Affiliates for any such Limited Partner Interest of such class
purchased during the 90-day period preceding the date that the
notice described in Section 15.1(b) is mailed. As used in this
Agreement, (i) "Current Market Price" as of any date of any class
of Limited Partner Interests listed or admitted to trading on any
National Securities Exchange means the average of the daily
Closing Prices (as hereinafter defined) per Limited Partner
Interest of such class for the 20 consecutive Trading Days (as
hereinafter defined) immediately prior to such date; (ii)
"Closing Price" for any day means the last sale price on such
day, regular way, or in case no such sale takes place on such
day, the average of the closing bid and asked prices on such day,
regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to
securities listed or admitted for trading on the principal
National Securities Exchange (other than the Nasdaq Stock Market)
on which such Limited Partner Interests of such class are listed
or admitted to trading or, if such Limited Partner Interests of
such class are not listed or admitted to trading on any National
Securities Exchange (other than the Nasdaq Stock Market), the
last quoted price on such day or, if not so quoted, the average
of the high bid and low asked prices on such day in the over-the-
counter market, as reported by the Nasdaq Stock Market or such
other system then in use, or, if on any such day such Limited
Partner Interests of such class are not quoted by any such
organization, the average of the closing bid and asked prices on
such day as furnished by a professional market maker making a
market in such Limited Partner Interests of such class selected
by the General Partner, or if on any such day no market maker is
making a market in such Limited Partner Interests of such class,
the fair value of such Limited Partner Interests on such day as
determined reasonably and in good faith by the General Partner;
and (iii) "Trading Day" means a day on which the principal
National Securities Exchange on which such Limited Partner
Interests of any class are listed or admitted to trading is open
for the transaction of business or, if Limited Partner Interests
of a class are not listed or admitted to trading on any National
Securities Exchange, a day on which banking institutions in New
York City generally are open.
(b) If the General Partner, any Affiliate of the General
Partner or the Partnership elects to exercise the right to
purchase Limited Partner Interests granted pursuant to Section
15.1(a), the General Partner shall deliver to the Transfer Agent
notice of such election to purchase (the "Notice of Election to
Purchase") and shall cause the Transfer Agent to mail a copy of
such Notice of Election to Purchase to the Record Holders of
Limited Partner Interests of such class (as of a Record Date
selected by the General Partner) at least 10, but not more than
60, days prior to the Purchase Date. Such Notice of Election to
Purchase shall also be published for a period of at least three
consecutive days in at least two daily newspapers of general
circulation printed in the English language and published in the
Borough of Manhattan, New York. The Notice of Election to
Purchase shall specify the Purchase Date and the price
(determined in accordance with Section 15.1(a)) at which Limited
Partner Interests will be purchased and state that the General
Partner, its Affiliate or the Partnership, as the case may be,
elects to purchase such Limited Partner Interests, upon surrender
of Certificates representing such Limited Partner Interests in
exchange for payment, at such office or offices of the Transfer
Agent as the Transfer Agent may specify, or as may be required by
any National Securities Exchange on which such Limited Partner
Interests are listed or admitted to trading. Any such Notice of
Election to Purchase mailed to a Record Holder of Limited Partner
Interests at his address as reflected in the records of the
Transfer Agent shall be conclusively presumed to have been given
regardless of whether the owner receives such notice. On or prior
to the Purchase Date, the General Partner, its Affiliate or the
Partnership, as the case may be, shall deposit with the Transfer
Agent cash in an amount sufficient to pay the aggregate purchase
price of all of such Limited Partner Interests to be purchased in
accordance with this Section 15.1. If the Notice of Election to
Purchase shall have been duly given as aforesaid at least 10 days
prior to the Purchase Date, and if on or prior to the Purchase
Date the deposit described in the preceding sentence has been
made for the benefit of the holders of Limited Partner Interests
subject to purchase as provided herein, then from and after the
Purchase Date, notwithstanding that any Certificate shall not
have been surrendered for purchase, all rights of the holders of
such Limited Partner Interests (including any rights pursuant to
Articles IV, V, VI, and XII) shall thereupon cease, except the
right to receive the purchase price (determined in accordance
with Section 15.1(a)) for Limited Partner Interests therefor,
without interest, upon surrender to the Transfer Agent of the
Certificates representing such Limited Partner Interests, and
such Limited Partner Interests shall thereupon be deemed to be
transferred to the General Partner, its Affiliate or the
Partnership, as the case may be, on the record books of the
Transfer Agent and the Partnership, and the General Partner or
any Affiliate of the General Partner, or the Partnership, as the
case may be, shall be deemed to be the owner of all such Limited
Partner Interests from and after the Purchase Date and shall have
all rights as the owner of such Limited Partner Interests
(including all rights as owner of such Limited Partner Interests
pursuant to Articles IV, V, VI and XII).
(c) At any time from and after the Purchase Date, a holder
of an Outstanding Limited Partner Interest subject to purchase as
provided in this Section 15.1 may surrender his Certificate
evidencing such Limited Partner Interest to the Transfer Agent in
exchange for payment of the amount described in Section 15.1(a),
therefor, without interest thereon.
ARTICLE XVI
General Provisions
16.1 Addresses and Notices
Any notice, demand, request, report or proxy materials
required or permitted to be given or made to a Partner or
Assignee under this Agreement shall be in writing and shall be
deemed given or made when delivered in person or when sent by
first class United States mail or by other means of written
communication to the Partner or Assignee at the address described
below. Any notice, payment or report to be given or made to a
Partner or Assignee hereunder shall be deemed conclusively to
have been given or made, and the obligation to give such notice
or report or to make such payment shall be deemed conclusively to
have been fully satisfied, upon sending of such notice, payment
or report to the Record Holder of such Partnership Security at
his address as shown on the records of the Transfer Agent or as
otherwise shown on the records of the Partnership, regardless of
any claim of any Person who may have an interest in such
Partnership Security by reason of any assignment or otherwise. An
affidavit or certificate of making of any notice, payment or
report in accordance with the provisions of this Section 16.1
executed by the General Partner, the Transfer Agent or the
mailing organization shall be prima facie evidence of the giving
or making of such notice, payment or report. If any notice,
payment or report addressed to a Record Holder at the address of
such Record Holder appearing on the books and records of the
Transfer Agent or the Partnership is returned by the United
States Post Office marked to indicate that the United States
Postal Service is unable to deliver it, such notice, payment or
report and any subsequent notices, payments and reports shall be
deemed to have been duly given or made without further mailing
(until such time as such Record Holder or another Person notifies
the Transfer Agent or the Partnership of a change in his address)
if they are available for the Partner or Assignee at the
principal office of the Partnership for a period of one year from
the date of the giving or making of such notice, payment or
report to the other Partners and Assignees. Any notice to the
Partnership shall be deemed given if received by the General
Partner at the principal office of the Partnership designated
pursuant to Section 2.3. The General Partner may rely and shall
be protected in relying on any notice or other document from a
Partner, Assignee or other Person if believed by it to be
genuine.
16.2 Further Action
The parties shall execute and deliver all documents, provide
all information and take or refrain from taking action as may be
necessary or appropriate to achieve the purposes of this
Agreement.
16.3 Binding Effect
This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their heirs, executors,
administrators, successors, legal representatives and permitted
assigns.
16.4 Integration
This Agreement constitutes the entire agreement among the
parties hereto pertaining to the subject matter hereof and
supersedes all prior agreements and understandings pertaining
thereto.
16.5 Creditors
None of the provisions of this Agreement shall be for the
benefit of, or shall be enforceable by, any creditor of the
Partnership.
16.6 Waiver
No failure by any party to insist upon the strict
performance of any covenant, duty, agreement or condition of this
Agreement or to exercise any right or remedy consequent upon a
breach thereof shall constitute waiver of any such breach of any
other covenant, duty, agreement or condition.
16.7 Counterparts
This Agreement may be executed in counterparts, all of which
together shall constitute an agreement binding on all the parties
hereto, notwithstanding that all such parties are not signatories
to the original or the same counterpart. Each party shall become
bound by this Agreement immediately upon affixing its signature
hereto or, in the case of a Person acquiring a Limited Partner
Interest, upon accepting the certificate evidencing such Limited
Partner Interest or executing and delivering a Transfer
Application as herein described, independently of the signature
of any other party.
16.8 Applicable Law
This Agreement shall be construed in accordance with and
governed by the laws of the State of Delaware, without regard to
the principles of conflicts of law.
16.9 Invalidity of Provisions
If any provision of this Agreement is or becomes invalid,
illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein
shall not be affected thereby.
16.10 Consent of Partners
Each Partner hereby expressly consents and agrees that,
whenever in this Agreement it is specified that an action may be
taken upon the affirmative vote or consent of less than all of
the Partners, such action may be so taken upon the concurrence of
less than all of the Partners and each Partner shall be bound by
the results of such action.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first written above.
GENERAL PARTNER
GENESIS ENERGY, L.L.C.,
By: /s/ Xxxx X. Xxxxxx
----------------------
Name: Xxxx X. Xxxxxx
Title: President and Chief
Executive Officer
LIMITED PARTNERS
All Limited Partners previously and
hereafter admitted as Limited
Partners of the Partnership,
pursuant to powers of attorney
previously and hereafter executed
in favor of, and granted and
delivered to the General Partner.
By: Genesis Energy, L.L.C.
General Partner, as attorney-in-
fact for all Limited Partners
pursuant to the Powers of
Attorney granted pursuant to
Section 2.6.
By: /s/ Xxxx X. Xxxxxx
----------------------
Name: Xxxx X. Xxxxxx
Title: President and Chief
Executive Officer
