Exhibit 3.13
EME HOMER CITY GENERATION L.P.
AGREEMENT
OF
LIMITED PARTNERSHIP
TABLE OF CONTENTS
PAGE
Article 1. Definitions..................................................................................1
Act ..................................................................................................1
Adjusted Capital Account .............................................................................1
Adjusted Capital Account Deficit .....................................................................1
Affiliate ............................................................................................1
Agent ................................................................................................1
Agreed Value .........................................................................................2
Agreement ............................................................................................3
Allocation Year ......................................................................................3
Capital Accounts .....................................................................................3
Capital Contributions ................................................................................3
Certificate ..........................................................................................3
Code .................................................................................................3
Depreciation .........................................................................................3
Dissolution Event ....................................................................................4
Effective Date .......................................................................................4
Fiscal Year ..........................................................................................4
General Partner ......................................................................................4
GP Interest ..........................................................................................4
Interest Holder ......................................................................................4
Limited Partner ......................................................................................4
Liquidator ...........................................................................................4
LP Interest ..........................................................................................4
Majority Interest ....................................................................................4
Nondeductible Expenditure ............................................................................4
Nonrecourse Deductions ...............................................................................4
Partner ..............................................................................................4
Partner Nonrecourse Debt Minimum Gain ................................................................5
Partner Nonrecourse Debt .............................................................................5
Partner Nonrecourse Deductions .......................................................................5
Partnership ..........................................................................................5
Partnership Interest .................................................................................5
Partnership Minimum Gain .............................................................................5
Percentage Interest ..................................................................................5
Permitted Transfer ...................................................................................5
Person ...............................................................................................5
Profits" and "Losses .................................................................................5
Regulations ..........................................................................................6
Transfer .............................................................................................6
Article 2. Formation of Partnership; Purpose............................................................6
2.1. Formation......................................................................................6
2.2. Name...........................................................................................7
2.3. Registered Office, Registered Agent and Places of Business.....................................7
2.4. Power of Attorney..............................................................................7
2.5. Term...........................................................................................8
2.6. Certificate of Limited Partnership.............................................................8
2.7. Purpose........................................................................................8
Article 3. Capital Contributions; Percentage Interests..................................................9
3.1. General Partner................................................................................9
3.2. Limited Partners...............................................................................9
3.3. No Interest....................................................................................9
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3.4. Loans from Partners............................................................................9
3.5. Additional Contributions.......................................................................9
Article 4. Capital Accounts.............................................................................9
Article 5. Distributions...............................................................................11
5.1. In General....................................................................................11
5.2. Liquidating Distributions.......................................................................11
Article 6. Allocations of Profits and Losses...........................................................11
6.1. Profits.......................................................................................11
6.2. Losses........................................................................................11
6.3. Limitations on Allocations of Losses..........................................................11
6.4. Special Allocations...........................................................................11
6.4.1. Minimum Gain Chargeback....................................................................12
6.4.2. Partner Minimum Gain Chargeback............................................................12
6.4.3. Qualified Income Offset....................................................................12
6.4.4. Nonrecourse Deductions.....................................................................12
6.4.5. Partner Nonrecourse Deductions.............................................................13
6.4.6. Certain 754 Adjustments....................................................................13
6.5. Curative Allocations..........................................................................13
6.6. Other Allocation Rules........................................................................13
6.6.1. Allocations When Interests Change..........................................................13
6.6.2. Allocation of Particular Items.............................................................14
6.6.3. Tax Reporting..............................................................................14
6.6.4. Profit Shares..............................................................................14
6.6.5. Minimum Allocations to General Partner......................................................14
6.6.6. Book Items Used in Special Allocations.....................................................14
6.7. Tax Allocations; Code Section 704(c)..........................................................15
6.7.1. Generally..................................................................................15
6.7.2. Contributed Property.......................................................................15
6.7.3. Adjustments to Agreed Value................................................................15
6.7.4. Elections..................................................................................15
Article 7. Tax Matters.................................................................................16
7.1. Preparation of Tax Returns....................................................................16
7.2. Tax Elections.................................................................................16
7.3. Tax Controversies.............................................................................16
Article 8. Business Management and Operation; Indemnification..........................................16
8.1. Powers of General Partner.....................................................................16
8.2. Duties of General Partner.....................................................................18
8.3. Prohibited Actions and Actions Requiring Limited Partner Approval.............................19
8.4. Reimbursement of the General Partner..........................................................19
8.5. Partnership Funds.............................................................................19
8.6. Outside Activities............................................................................20
8.7. Limited Liability; Indemnification............................................................20
8.8. Books, Records, and Accounting................................................................21
8.9. Fiscal Year; Taxable Year.....................................................................21
Article 9. Limited Partner Rights and Obligations......................................................22
9.1. Limitation of Liability.......................................................................22
9.2. Management of Business........................................................................22
9.3. Outside Activities............................................................................22
9.4. Return of Capital.............................................................................22
9.5. Rights of Limited Partners....................................................................22
Article 10. Transfers of Interests.....................................................................23
10.1. General Partner...............................................................................23
10.1.1. Voluntary Transfers and Withdrawals.......................................................23
10.1.2. Involuntary Transfers.....................................................................23
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10.1.3. Prohibited Transfers...................................................................24
10.2. Limited Partners..............................................................................24
10.2.1. In General................................................................................24
10.2.2. Permitted Transfers.......................................................................24
10.2.3. Conditions to Permitted Transfers.........................................................24
10.2.4. Prohibited Transfers......................................................................25
Article 11. Additional Partners........................................................................25
Article 12. Dissolution and Liquidation................................................................25
12.1. Dissolution...................................................................................25
12.2. Liquidation...................................................................................26
12.3. Distribution in Kind..........................................................................27
12.4. Cancellation of Certificate of Limited Partnership............................................28
12.5. No General Partner Liability for Return of Capital............................................28
12.6. Waiver of Partition...........................................................................28
12.7. Compliance with Timing Requirements of Regulations............................................28
12.8. Non-Dissolving Code Section 708(b) Terminations...............................................28
12.9. Allocations during the Period of Liquidation..................................................29
Article 13. Amendment of Agreement.....................................................................29
Article 14. General Provisions.........................................................................29
14.1. Personal Property.............................................................................29
14.2. Addresses and Notices.........................................................................29
14.3. Headings......................................................................................29
14.4. Binding Effect................................................................................29
14.5. Integration...................................................................................30
14.6. Waiver........................................................................................30
14.7. Counterparts..................................................................................30
14.8. Severability..................................................................................30
14.9. Applicable Law................................................................................30
iii
EME HOMER CITY GENERATION L.P.
AGREEMENT OF
LIMITED PARTNERSHIP
THIS AGREEMENT OF LIMITED PARTNERSHIP, is dated as of October
31, 1998, and is entered into by and among MISSION ENERGY WESTSIDE, INC., a
California corporation ("Mission"), as general partner, and CHESTNUT RIDGE
ENERGY COMPANY, a California corporation ("Chestnut Ridge"), as limited partner.
ARTICLE 1. DEFINITIONS
The following definitions shall for all purposes, unless
otherwise clearly indicated to the contrary, apply to the terms used in this
Agreement.
"ACT" means the Pennsylvania Revised Uniform Limited
Partnership Act, 15 Pa.C.S.A. ch.85, as amended from time to time (or any
corresponding provisions of succeeding law).
"ADJUSTED CAPITAL ACCOUNT" means, with respect to an Interest
Holder, an account the balance (which may be a deficit balance) in which is
equal to the balance in such Interest Holder's Capital Account as of the end of
the relevant Allocation Year, after giving effect to the following adjustments:
(i) credit to such Capital Account any amounts which such Interest Holder is
obligated to restore pursuant to any provision of this Agreement or is deemed to
be obligated to restore to the Partnership pursuant to Regulations Sections
1.704-2(g)(1) and 1.704-2(i)(5); and (ii) debit to such Capital Account such
Interest Holder's share of items described in Regulations Section
1.704-1(b)(2)(ii)(d)(4), (5) and (6). The foregoing definition of Adjusted
Capital Account is intended to comply with the provisions of Regulations Section
1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.
"ADJUSTED CAPITAL ACCOUNT DEFICIT" means, with respect to an
Interest Holder, the deficit balance, if any, in such Interest Holder's Adjusted
Capital Account.
"AFFILIATE" means, with respect to any Person (i) any other
Person who bears a relationship to the first Person described in either Code
Section 267(b) (substituting, however, "10 percent" for "50 percent" everywhere
in Code Section 267) or Code Section 707(b) (substituting, however, "10 percent"
for "50 percent" everywhere in Code Section 707), and (ii) any officer,
director, general partner, or trustee of any Person described in clauses (i) or
(ii) of this sentence.
"AGENT" has the meaning specified in Section 2.4.1.
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"AGREED VALUE" means, with respect to any asset, the asset's
adjusted basis for federal income tax purposes, except as follows:
(i) The initial Agreed Value of any asset contributed by a Partner to
the Partnership shall be the gross fair market value of such asset;
(ii) The Agreed Values of all Partnership assets shall be adjusted to
equal their respective gross fair market values (taking Code Section 7701(g)
into account) as of the following times: (a) the acquisition of an additional
interest in the Partnership by any new or existing Interest Holder in exchange
for more than a DE MINIMIS Capital Contribution; (b) the distribution by the
Partnership to an Interest Holder of more than a DE MINIMIS amount of
Partnership property as consideration for an interest in the Partnership; (c)
the liquidation of the Partnership within the meaning of Regulations Section
1.704-1(b)(2)(ii)(g); and (d) at such other times as the General Partner shall
reasonably determine necessary or advisable in order to comply with Regulations
Sections 1.704-1(b) and 1.704-2; provided that the adjustments described in
clauses (a) and (b) of this paragraph shall be made only if the General Partner
reasonably determines that such adjustment is necessary or appropriate to
reflect the relative economic interests of the Interest Holders in the
Partnership;
(iii) The Agreed Value of any Partnership asset distributed to any
Interest Holder shall be the gross fair market value (taking Code Section
7701(g) into account) of such asset on the date of distribution; and
(iv) The Agreed Values of Partnership assets shall be increased (or
decreased) to reflect any adjustments to the adjusted basis of such assets
pursuant to Code Section 732(d), Code Section 734(b) or Code Section 743(b), but
only to the extent that such adjustments are taken into account in determining
capital accounts pursuant to Regulations Section 1.704-1(b)(2)(iv)(m); provided,
however, that Agreed Values shall not be adjusted pursuant to this clause (iv)
to the extent that an adjustment pursuant to clause (ii) hereof is made in
connection with a transaction that would otherwise result in an adjustment
pursuant to this clause (iv).
The Agreed Value of any interest in another partnership held
by the Partnership shall be determined as provided above, except that (a) at any
time at which such Agreed Value is determined pursuant to clause (i), (ii) or
(iii) above, it shall be increased by the Partnership's share of the liabilities
of such other partnership under Code Section 752 at such time and (b) Agreed
Value shall be increased or decreased to reflect subsequent increases or
decreases in the Partnership's share of such liabilities or increases in the
Partnership's individual liabilities by reason of its assumption of liabilities
of such other partnership or decreases in the Partnership's individual
liabilities by reason of such other partnership's assumption thereof to the same
extent and at the same time that it would be so increased or decreased if it
were actually the federal income tax basis of the Partnership's interest in such
other partnership.
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If the Agreed Value of an asset has been determined or adjusted pursuant to this
definition of Agreed Value, such Agreed Value shall thereafter be adjusted by
Depreciation with respect to such asset taken into account in computing Profits
and Losses.
Determinations of gross fair market value for purposes of this definition of
Agreed Value shall be made as follows: (a) in situations described in paragraphs
(i), (ii)(a), (ii)(b) and (iii) above by agreement between the General Partner
and the Interest Holder making the contribution or receiving the distribution as
the case may be, provided, however that if the General Partner (or any Affiliate
of the General Partner) is the contributor or the distributee such determination
shall require agreement between the contributor or the distributor and a
Majority Interest; and (b) in other situations by agreement between the General
Partner and a Majority Interest. In a case in which agreement cannot be reached
as required in the foregoing provisions of this paragraph, the appraisal
procedure set forth in Section 10.1.2.3 shall be followed to determine gross
fair market value, substituting, however, the parties whose agreement is so
required as the persons to select the initial two appraisers.
"AGREEMENT" means this Agreement of Limited Partnership.
"ALLOCATION YEAR" means (i) the period commencing on the date
of inception of the Partnership and ending on the next following December 31,
(ii) any subsequent twelve (12) month period commencing on January 1 and ending
on December 31, or (iii) any portion of the period described in clauses (i) or
(ii) for which the Partnership is required to allocate Profits, Losses and other
items of Partnership income, gain, loss or deduction pursuant to Article 6.
"CAPITAL ACCOUNTS" mean the capital accounts maintained with
respect to Partnership Interests pursuant to Article 4.
"CAPITAL CONTRIBUTIONS" means with respect to any Partner the
amount of money and the initial Agreed Value of any property (other than money)
contributed to the Partnership with respect to the interest in the Partnership
held by such Partner.
"CERTIFICATE" means the certificate of limited partnership for
the Partnership required to be filed pursuant to Section 8511 of the Act.
"CODE" means the Internal Revenue Code of 1986, as amended
from time to time (or any corresponding provisions of succeeding law).
"DEPRECIATION" means, for each Allocation Year, an amount
equal to the depreciation, amortization or other cost recovery deduction
allowable with respect to an asset for such Allocation Year, except that if the
Agreed Value of an asset differs from its adjusted basis for federal income tax
purposes at the beginning of such Allocation Year,
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Depreciation shall be determined in accordance with Regulations Section
1.704-1(b)(2)(iv)(g)(3) or Regulations Section 1.704-3(d)(2), whichever is
applicable.
"DISSOLUTION EVENT" has the meaning assigned to that term in
Section 12.1.
"EFFECTIVE DATE" means October 31, 1998.
"FISCAL YEAR" means (i) the period commencing on the date of
inception of the Partnership and ending on the next following December 31, (ii)
any subsequent twelve-month period commencing on January 1 and ending on
December 31 and (iii) the period commencing on the immediately preceding January
1 and ending on the date on which all Partnership property has been distributed
to the Interest Holders pursuant to Section 12.2 hereof.
"GENERAL PARTNER" means Mission or any other Person admitted
to the Partnership pursuant to this Agreement in the capacity of a general
partner.
"GP INTEREST" means an interest in the Partnership issued
pursuant to this Agreement to a Person in its capacity as the General Partner.
"INTEREST HOLDER" means any Person who is entitled to receive
distributions and allocations with respect to a Partnership Interest.
"LIMITED PARTNER" means, as the case may be, Chestnut Ridge or
any other Person admitted to the Partnership pursuant to this Agreement in the
capacity of a limited partner.
"LIQUIDATOR" has the meaning specified in Section 12.2.
"LP INTEREST" means an interest in the Partnership issued
pursuant to this Agreement to a Person its capacity as a Limited Partner.
"MAJORITY INTEREST" means Limited Partners whose aggregate
Percentage Interests total more than one-half of the aggregate Percentage
Interests of the Limited Partners.
"NONDEDUCTIBLE EXPENDITURE" has the meaning specified under
the definition of Profits below.
"NONRECOURSE DEDUCTIONS" has the meaning set forth in
regulations Section 1.704-2(b)(1). The amount and items of Nonrecourse
Deductions shall be determined in accordance with Regulations Sections
1.704-2(c) and 1.704-2(j)(1).
"PARTNER" means the General Partner or a Limited Partner.
4
"PARTNER NONRECOURSE DEBT MINIMUM GAIN" has the meaning set
forth in Regulations Section 1.704-2(i).
"PARTNER NONRECOURSE DEBT" has the meaning set forth in
Regulations Section 1.704-2(b)(4).
"PARTNER NONRECOURSE DEDUCTIONS" has the meaning set forth in
Regulations Section 1.704-2(i).
"PARTNERSHIP" means EME Homer City Generation L.P., a
Pennsylvania limited partnership.
"PARTNERSHIP INTEREST" means a GP Interest or an LP Interest.
"PARTNERSHIP MINIMUM GAIN" has the meaning set forth in
Regulations Sections 1.704-2(b)(2) and 1.704-2(d).
"PERCENTAGE INTEREST" means, with respect to any Interest
Holder, the Interest Holder's interest, expressed as a percentage, in certain
Profits, Losses (and items thereof) and distributions of the Partnership as set
out in this Agreement and as may be amended from time to time to reflect the
transfer of Partnership Interests or the issuance of additional Partnership
Interests.
"PERMITTED TRANSFER" is defined in Section 10.2.2.
"PERSON" means an individual, a corporation, a partnership, a
trust, an unincorporated organization, an association, or any other entity.
"PROFITS" and "LOSSES" means, for each Allocation Year, an
amount equal to the Partnership's taxable income or loss for such Allocation
Year, determined in accordance with Code Section 703(a) (for this purpose, all
items of income, gain, loss or deduction required to be stated separately
pursuant to Code Section 703(a)(1) shall be included in taxable income or loss),
with the following adjustments:
(i) Any income of the Partnership that is exempt from federal income
tax and not otherwise taken into account in computing Profits or Losses pursuant
to this definition shall be added to such taxable income or loss;
(ii) Any expenditures of the Partnership described in Code Section
705(a)(2)(B) or treated as Code Section 705(a)(2)(b) expenditures pursuant to
Regulations Section 1.704-1(b)(2)(iv)(i) ("Nondeductible Expenditures"), and not
otherwise taken into account in computing Profits or Losses pursuant to this
definition shall be subtracted from such taxable income or loss;
5
(iii) If the Agreed Value of any Partnership asset is adjusted pursuant
to clause (ii) or clause (iii) of the definition of Agreed Value hereunder, the
amount of such adjustment shall be taken into account as gain or loss from the
disposition of such asset for purposes of computing Profits or Losses;
(iv) Gain or loss resulting from any disposition of Partnership
property with respect to which gain or loss is recognized for federal income tax
purposes shall be computed by reference to the Agreed Value of the property
disposed of, notwithstanding that the adjusted tax basis of such property
differs from its Agreed Value;
(v) In lieu of the depreciation, amortization, and other cost recovery
deductions taken into account in computing such taxable income or loss, there
shall be taken into account Depreciation for such Allocation Year;
(vi) To the extent an adjustment to the adjusted tax basis of any
Partnership asset pursuant to Code Section 734(b) is required, pursuant to
Regulations Section 1.704-(b)(2)(iv)(m)(4), to be taken into account in
determining Capital Accounts as a result of a distribution other than in
liquidation of an Interest Holder's interest in the Partnership, the amount of
such adjustment 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) from
the disposition of such asset and shall be taken into account for purposes of
computing Profits or Losses; and
(vii) Notwithstanding any other provision of this definition, any items
which are specially allocated pursuant to Section 6.4 or Section 6.5 hereof
shall not be taken into account in computing Profits or Losses.
"REGULATIONS" means the Income Tax Regulations promulgated
under the Code, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).
"TRANSFER" means, as a noun, any voluntary or involuntary
transfer, sale, pledge, hypothecation, or other disposition and, as a verb,
voluntarily or involuntarily to transfer, sell, pledge, hypothecate, or
otherwise dispose of.
ARTICLE 2. FORMATION OF PARTNERSHIP; PURPOSE
2.1. FORMATION. Subject to the provisions of this Agreement,
the General Partner and the Limited Partner hereby form the Partnership as a
limited partnership pursuant to the provisions of the Act. The General Partner
and the Limited Partner hereby enter into this Agreement to set forth the rights
and obligations of the Partners and certain matters related thereto. Except as
expressly provided herein to the contrary, the rights and obligations of the
Partners and the administration, dissolution, and termination of the Partnership
shall be governed by the Act.
6
2.2. NAME. The name of the Partnership shall be, and the
business of the Partnership shall be conducted under the name of, "EME Homer
City Generation L.P."; provided, however, that (a) the Partnership's business
may be conducted under any other name or names deemed advisable by the General
Partner, (b) the General Partner in its sole discretion may change the name of
the Partnership at any time and from time to time, and (c) the name of the
Partnership and any name under which the Partnership conducts business shall
include "L.P." or "Limited Partnership" (or similar words or letters) where
necessary for purposes of maintaining the limited liability status of the
Limited Partners or otherwise complying with the laws of any jurisdiction that
so requires.
2.3. REGISTERED OFFICE, REGISTERED AGENT AND PLACES OF
BUSINESS. The registered office of the Partnership in the Commonwealth of
Pennsylvania is CT Corporation, 1635 Market Street, Philadelphia, Pennsylvania
19103. The General Partner may change the registered office of the Partnership
in the Commonwealth of Pennsylvania upon giving notice of such change to the
other Partners. The Partnership may establish other offices at such places as
the General Partner deems advisable.
2.4. POWER OF ATTORNEY.
2.4.1. The Limited Partners hereby constitute and
appoint the General Partner or, if a Liquidator shall have been selected
pursuant to Section 12.2, the Liquidator, with full power of substitution, as
their true and lawful agent and attorney-in-fact ("Agent"), with full power and
authority in such Partners' name, place, and stead to:
2.4.1.1. execute, swear to, acknowledge,
deliver, file, and record in the appropriate public offices (A) all
certificates, documents, and other instruments (including, without
limitation, this Agreement and the Certificate and any amendments or
restatements thereof) that the Agent deems appropriate or necessary to
form or 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) under the laws of any state
or jurisdiction; (B) all certificates, documents, and other instruments
that the Agent deems appropriate or necessary to reflect any
amendments, changes, or modifications of this Agreement in accordance
with its terms; (C) all conveyances and other documents or instruments
that the Agent deems appropriate or necessary to reflect the
dissolution and liquidation of the Partnership pursuant to the terms
of this Agreement; and (D) all certificates, documents, and other
instruments relating to the admission, substitution or withdrawal of
any Partner pursuant to Article 10 or 11 and other events described in
Article 10 or 11; and
2.4.1.2. execute, swear to, acknowledge, and file all
ballots, consents, approvals, waivers, certificates, documents, and
other instruments that the Agent deems appropriate or necessary in
order to make, evidence, give, confirm, or ratify any vote, consent,
approval, agreement, or other action that is made or given by the
Partners hereunder, is deemed to be made or given by the
7
Partners hereunder, is consistent with the terms of this Agreement, or
is deemed by the Agent to be appropriate or necessary to effectuate
the terms or intent of this Agreement or the purposes of the
Partnership; provided, however, that, if any vote or approval of the
Limited Partners is specifically required for an action by any
provision of this Agreement, the Agent may exercise the power of
attorney made in this Section 2.4.1.2 to take such action only after
such vote or approval is obtained.
2.4.2. The foregoing power of attorney is hereby declared to
be irrevocable and a power coupled with an interest, and it shall survive and
not be affected by the subsequent termination, incapacity, or bankruptcy of any
Limited Partner and the transfer of all or any portion of a Limited Partner's
Partnership Interest and shall extend to a Limited Partner's transferees and
assigns. The Limited Partners hereby agree to be bound by any representations
made by the Agent acting in good faith pursuant to such power of attorney; and
the Limited Partners hereby waive any and all defenses that may be available to
contest, negate, or disaffirm the action of the Agent taken in good faith
pursuant to such power of attorney. The Limited Partners shall execute and
deliver to the Agent, within fifteen days after receipt of the Agent's request
therefor, such further designations, powers of attorney, and other instruments
as the Agent deems appropriate or necessary to effectuate the terms or intent of
this Agreement or the purposes of the Partnership.
2.5. TERM. The term of the Partnership shall commence upon the
filing of the Certificate with the Pennsylvania Secretary of State and shall
continue until the close of Partnership business on December 31, 2048 or until
the earlier termination of the Partnership in accordance with the provisions of
Article 12.
2.6. CERTIFICATE OF LIMITED PARTNERSHIP. The General
Partner shall file a Certificate for the Partnership with the Secretary of
State of the Commonwealth of Pennsylvania as required by the Act. The
Certificate, and any amendment to the Certificate, shall address only the
matters set forth in Section 8511(a)(1), (2), (3) and (4) of the Act. The
General Partner shall deliver to each Limited Partner a copy of the
Certificate and any further certificate of amendment thereto. The General
Partner shall cause to be filed such other certificates or documents as may
be required for the operation, and qualification of a limited partnership in
Pennsylvania and any other state in which the Partnership may elect to do
business. The General Partner shall thereafter file any necessary
certificates of amendment to the Certificate and such other certificates and
documents and do all things requisite to the maintenance of the Partnership
as a limited partnership (or as a partnership in which the Limited Partners
have limited liability) under the laws of Pennsylvania and any other state in
which the Partnership may elect to do business.
2.7. PURPOSE. The purpose and business of the Partnership
shall be to engage in acquiring, owning, and operating the Homer City Electric
Generation Station located near Indiana, Pennsylvania, and certain facilities
and other assets associated
8
therewith and ancillary thereto, to obtain financing in respect thereof and to
engage in all other lawful business activities in connection therewith.
ARTICLE 3. CAPITAL CONTRIBUTIONS; PERCENTAGE INTERESTS
3.1. GENERAL PARTNER. As of the Effective Date, Mission shall,
in its capacity as the General Partner, contribute to the Partnership such
amount and shall own the Percentage Interest set forth opposite its name in
SCHEDULE A hereto.
3.2. LIMITED PARTNERS. At the request of the General Partner
made as of the Effective Date, Chestnut Ridge, in its capacity as a Limited
Partner, shall contribute to the Partnership such amount and shall own the
Percentage Interest set forth opposite its name in SCHEDULE A hereto.
3.3. NO INTEREST. No interest shall be paid by the
Partnership on any Capital Contributions or on the amount in any Partner's
Capital Account.
3.4. LOANS FROM PARTNERS. Loans or other similar advances by a
Partner to or for the account of the Partnership shall not be considered Capital
Contributions. Any such loans or other similar advances shall be made subject to
such terms and conditions acceptable to the lending Partner as the General
Partner determines to be in the best interests of the Partnership.
3.5. ADDITIONAL CONTRIBUTIONS. Except as provided in this
Section 3.5 or as required pursuant to an agreement relating to the purchase by
any person other than Mission or Chestnut Ridge of a Partnership Interest in the
Partnership, no Partner shall be entitled to make additional capital
contributions to the Partnership, except upon the approval of the General
Partner; PROVIDED that each Partner shall be given the opportunity for 30 days
after written notice from the General Partner to make such Partner's PRO RATA
share of additional contributions. If such rights of contribution are exercised
by some but not all of the partners, the General Partner shall so notify all of
the Partners. Thereafter, the Partners that elected to exercise such rights of
contribution shall have the further right to make additional contributions up to
the amount of the contribution shortfall on a PRO RATA basis, or as they may
otherwise agree, within 10 days of receipt of such second notice, and the
respective Partnership Interests of all the Partners shall be adjusted to
reflect such unequal additional contributions. Nothing in this Section 3.5 shall
require the General Partner to give the initial written notice requesting
additional Capital contributions.
ARTICLE 4. CAPITAL ACCOUNTS
The Partnership shall maintain for each Interest Holder a
single Capital Account with respect to the Interest Holder's Partnership
Interest in accordance with the regulations issued pursuant to Section 704 of
the Code. The Capital Account of each
9
Interest Holder shall be maintained for such Person in accordance with the
following provisions:
(a) To each Person's Capital Account there shall be
credited such Person's Capital Contributions, and such Person's
distributive share of Profits and any items in the nature of income or
gain which are specially allocated pursuant to Section 6.4 or Section
6.5 or Section 6.6.5 hereof, and the amount of any Partnership
liabilities which are assumed by such Person or which are secured by
any Partnership property distributed to such Person.
(b) To each Person's Capital Account there shall be
debited the amount of cash and the Agreed Value of any Partnership
property distributed to such Person pursuant to any provision of this
Agreement, such Person's distributive share of Losses and any items in
the nature of expenses or losses which are specially allocated pursuant
the Section 6.4 or Section 6.5 or Section 6.6.5 hereof, and the amount
of any liabilities of such Person which are assumed by the Partnership
or which are secured by any property contributed by such Person to the
Partnership.
(c) In the event that all or a portion of a
Partnership Interest is transferred in accordance with the terms of
this Agreement, the transferee shall succeed to the Capital Account of
the transferor to the extent that it relates to the transferred
interest.
(d) In determining the amount of any liability for
purposes of paragraphs (a) and (b) of this definition, there shall be
taken into account Code Section 752(c) and any other applicable
provisions of the Code and Regulations.
The principal amount of a promissory note which is not readily traded
on an established securities market and which is contributed to the Partnership
by the maker of the note shall not be included in the Capital Account of any
Interest Holder until the Partnership makes a taxable disposition of the note or
until (and to the extent) principal payments are made on the note, all in
accordance with Regulations Section 1.704-1(b)(2)(iv)(d)(2).
The foregoing provisions and the other provisions of this Agreement
relating to the maintenance of Capital Accounts are intended to comply with
Regulations Sections 1.704-1(b) and 1.704-2, and shall be interpreted and
applied in a manner consistent with such Regulations. To the extent that such
Regulations require that adjustments other than those set out above or in
Section 6.4.6 be made to the Capital Accounts of the Partners, such adjustments
shall be made, but without duplication of any such required adjustments that are
effected through the definitions of "Profits" and "Losses" or Section 6.4.6 or
Section 6.6.6.
10
ARTICLE 5. DISTRIBUTIONS
5.1. IN GENERAL. The General Partner shall determine from time
to time whether the Partnership has funds in excess of those reasonably needed
by the business of the Partnership (including reasonable reserves for operating
expenses, for debt service, for repairs, for capital expenditures, improvements,
and additions, and for contingencies). Such determination shall be made as of
the end of each calendar year and the excess funds so determined with respect to
a calendar year, if any, shall be distributed to the Partners within 60 days
after the end of such calendar year. The General Partner may also determine in
its sole discretion to make additional distributions of excess Partnership funds
to the Partners. Any such annual or additional distributions shall be made to
the Interest Holders in proportion to their respective Percentage Interests.
5.2. LIQUIDATING DISTRIBUTIONS. Notwithstanding Section 5.1 to
the contrary, following the dissolution of the Partnership, distributions to the
Partners shall be made in accordance with the provisions of Article 12.
ARTICLE 6. ALLOCATIONS OF PROFITS AND LOSSES
6.1. PROFITS. After giving effect to the special allocations
set forth in Sections 6.4 and 6.5 hereof, Profits for any Allocation Year shall
be allocated among the Interest Holders in proportion to their respective
Percentage Interests.
6.2. LOSSES. After giving effect to the special allocations
set forth in Sections 6.4 and 6.5 hereof, and subject to the provisions of
Section 6.3 below, Losses for any Allocation Year shall be allocated among the
Interest Holders in proportion to their respective Percentage Interests.
6.3. LIMITATIONS ON ALLOCATIONS OF LOSSES. The Losses
allocated to any Interest Holder pursuant to Section 6.2 hereof for any
Allocation Year shall not exceed the maximum amount of Losses that can be so
allocated without causing such Interest Holder to have (or to suffer an increase
to) an Adjusted Capital Account Deficit at the end of the Allocation Year. Any
Losses otherwise allocable to an Interest Holder but for the limitation set
forth in this Section 6.3 shall be reallocated among Interest Holders, if any,
having positive balances in their Adjusted Capital Accounts in accordance with
the provisions of Section 6.2, subject, however, to the limitation of the
preceding sentence and a consequent reallocation pursuant to this sentence. Any
Losses which may be allocated to no Interest Holder under Section 6.2 due to
such limitation shall be allocated among the Interest Holders in the proportions
required by Regulations Section 1.704-1(b)(3).
6.4. SPECIAL ALLOCATIONS. The following special allocations
shall be made in the following order:
11
6.4.1. MINIMUM GAIN CHARGEBACK. Except as otherwise
provided in Section 1.704-2(f) of the Regulations, notwithstanding any other
provision of this Article 6, if there is a net decrease in Partnership Minimum
Gain during any Allocation Year, each Interest Holder shall be specially
allocated items of Partnership income and gain for such Allocation Year (and, if
necessary, subsequent Allocation Years) in an amount equal to such Interest
Holder's share of the net decrease in Partnership Minimum Gain, determined in
accordance with Regulations Section 1.704-2(g). Allocations pursuant to the
previous sentence shall be made in proportion to the respective amounts required
to be allocated to each Interest Holder pursuant thereto. The items to be so
allocated shall be determined in accordance with Sections 1.704-2(f)(6) and
1.704-2(j)(2) of the Regulations. This Section 6.4.1 is intended to comply with
the minimum gain chargeback requirement in Section 1.704-2(f) of the Regulations
and shall be interpreted consistently therewith.
6.4.2. PARTNER MINIMUM GAIN CHARGEBACK. Except as
otherwise provided in Section 1.704-2(i)(4) of the Regulations, notwithstanding
any other provision of this Article 6, if there is a net decrease in Partner
Nonrecourse Debt Minimum Gain attributable to a Partner Nonrecourse Debt during
any Allocation Year, each Interest Holder who has a share of the Partner
Nonrecourse Debt Minimum Gain attributable to such Partner Nonrecourse Debt,
determined in accordance with Section 1.704-2(i)(5) of the Regulations, shall be
specially allocated items of Partnership income and gain for such Allocation
Year (and, if necessary, subsequent Allocation Years) in an amount equal to such
Interest Holder's share of the net decrease in Partner Nonrecourse Debt Minimum
Gain attributable to such Partner Nonrecourse Debt, determined in accordance
with Regulations Section 1.704-2(i)(4). Allocations pursuant to the previous
sentence shall be made in proportion to the respective amounts required to be
allocated to each Interest Holder pursuant thereto. The items to be so allocated
shall be determined in accordance with Sections 1.704-2(i)(4) and 1.704-2(j)(2)
of the Regulations. This Section 6.4.2 is intended to comply with the minimum
gain chargeback requirement in Section 1.704-2(i)(4) of the Regulations and
shall be interpreted consistently therewith.
6.4.3. QUALIFIED INCOME OFFSET. If any Interest
Holder unexpectedly receives any adjustment, allocation or distribution
described in Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6), items of
Partnership income and gain shall be specially allocated to such Interest Holder
in an amount and manner sufficient to eliminate, to the extent required by the
Regulations, any resulting Adjusted Capital Account Deficit of such Interest
Holder as quickly as possible; provided, however, that an allocation pursuant to
this Section 6.4.3 shall be made if and only to the extent that such Interest
Holder would have an Adjusted Capital Account Deficit after all other
allocations provided for in this Article 6 have been tentatively made as if this
Section 6.4.3 were not in this Agreement.
6.4.4. NONRECOURSE DEDUCTIONS. Nonrecourse Deductions
for any Allocation Year shall be allocated among the Interest Holders in
proportion to their respective Percentage Interests.
12
6.4.5. PARTNER NONRECOURSE DEDUCTIONS. Partner
Nonrecourse Deductions for any Allocation Year shall be allocated to the
Interest Holder who bears the economic risk of loss with respect to the Partner
Nonrecourse Debt to which such Partner Nonrecourse Deductions are attributable
in accordance with Regulations Section 1.704-2(i)(1).
6.4.6. CERTAIN 754 ADJUSTMENTS. To the extent an
adjustment to the adjusted tax basis of any Partnership asset pursuant to Code
Section 743(b), Code Section 732(d) or Code Section 734(b) is required pursuant
to Regulations Section 1.704-1(b)(2)(iv)(m) to be taken into account in
determining Capital Accounts as the result of a distribution to an Interest
Holder in complete liquidation of its interest in the Partnership, the amount of
such adjustment to 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 gain or loss shall be specially allocated to the
Interest Holders in accordance with their interests in the Partnership as
determined under Regulations Section 1.704-1(b)(3) in the event Regulations
Section 1.704-1(b)(2)(iv)(m)(2) applies, or to the Interest Holder to whom such
distribution was made in the event Regulations Section 1.704-1(b)(2)(iv)(m)(4)
applies.
6.5. CURATIVE ALLOCATIONS. The allocations set forth in
Sections 6.4.1 through 6.4.6, inclusive, and 6.6.5 hereof (the "REGULATORY
ALLOCATIONS") are intended to comply with certain requirements of the
Regulations and Internal Revenue Service advance ruling requirements. It is the
intent of the parties to this Agreement that, to the extent possible, all
Regulatory Allocations shall be offset either with other Regulatory Allocations
or with special allocations of other items of income, gain, loss or deduction
pursuant to this Section 6.5. Therefore, notwithstanding any other provision of
this Article 6 (other than the Regulatory Allocations and the following
sentence), the General Partner shall make such offsetting special allocations of
Partnership income, gain, loss or deduction in whatever manner it determines
appropriate so that, after such offsetting allocations are made, each Interest
Holder's Capital Account balance is, to the extent possible, equal to the
Capital Account balance which such Interest Holder would have had if the
Regulatory Allocations were not part of this Agreement and all Partnership items
were allocated pursuant to Sections 6.1 and 6.2 hereof. In exercising its
discretion under this Section 6.5, the General Partner shall take into account
Regulatory Allocations under Sections 6.4.1 and 6.4.2 that, although not yet
made, are likely to offset other Regulatory Allocations previously made under
Sections 6.4.4 and 6.4.5.
6.6. OTHER ALLOCATION RULES.
6.6.1. ALLOCATIONS WHEN INTERESTS CHANGE. For
purposes of determining the Profits, Losses or any other items allocable to any
period, Profits, Losses and any such other items shall be determined on a daily,
monthly, or other basis, as determined by the General Partner using any
permissible method under Code Section 706 and the Regulations thereunder;
provided, however, that any adjustments to the Agreed
13
Value of a Partnership asset treated as gain or loss under paragraph (iii) of
the definition of "Profits" and "Losses" or under Section 6.6.6.3 hereof shall
be allocated only to those persons who were Interest Holders immediately before
the event giving rise to such adjustment.
6.6.2. ALLOCATION OF PARTICULAR ITEMS. Except as
otherwise provided in this Agreement, all items of Partnership income, gain,
loss, deduction and any other allocations not otherwise provided for shall be
divided among the Interest Holders in the same proportions as they share Profits
or Losses, as the case may be, for the year.
6.6.3. TAX REPORTING. The Interest Holders are aware
of the income tax consequences of the allocations made by this Article 6 and
hereby agree to be bound by the provisions of this Article 6 in reporting their
shares of Partnership income and loss for income tax purposes.
6.6.4. PROFIT SHARES. Solely for purposes of
determining an Interest Holder's proportionate share of the Partnership's
"excess nonrecourse liabilities," as defined in Regulations Section 1.752-3(a),
the Interest Holders' interests in Partnership profits shall be deemed to be in
proportion to their respective shares of Profits set forth in Section 6.1.
6.6.5. MINIMUM ALLOCATIONS TO GENERAL PARTNER.
Notwithstanding the preceding provisions of this Article 6, other than Sections
6.3. and 6.4, the General Partner shall be allocated not less than one percent
of each item of income, gain, deduction or loss of the Partnership for each
Allocation Year.
6.6.6. BOOK ITEMS USED IN SPECIAL ALLOCATIONS. For
purposes of determining the Partnership's items of income, gain, loss or
deduction for any Allocation Year available to be allocated pursuant to Sections
6.4, 6.5 and 6.6.5 hereof, the following rules shall be applied:
6.6.6.1. Any income of the Partnership that
is exempt from federal income tax shall be taken into account as an
item of income;
6.6.6.2. Any Nondeductible Expenditure of
the Partnership shall be taken into account as an item of deduction;
6.6.6.3. In the event the Agreed Value of
any Partnership asset is adjusted pursuant to paragraph (ii) or
paragraph (iii) under the definition herein of "Agreed Value," the
amount of such adjustment shall be taken into account as gain or loss
from the disposition of such asset;
6.6.6.4. Gain or loss resulting from any
disposition of Partnership property with respect to which gain or loss
is recognized for federal
14
income tax purposes shall be computed by reference to the Agreed Value
of the property disposed of, notwithstanding that the adjusted tax
basis of such property differs from its Agreed Value;
6.6.6.5. In lieu of the depreciation,
amortization and other cost recovery deductions taken into account in
computing the Partnership's taxable income or loss there shall be
taken into account Depreciation for such Allocation Year; and
6.6.6.6. To the extent an adjustment to the
adjusted tax basis of any Partnership asset pursuant to Code Section
734(b) is required, pursuant to Regulations Section
1.704-(b)(2)(iv)(m)(4), to be taken into account in determining
Capital Accounts as a result of a distribution other than in
liquidation of an Interest Holder's interest in the Partnership, the
amount of such adjustment 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) from the disposition of such asset.
6.7. TAX ALLOCATIONS; CODE SECTION 704(c).
6.7.1. GENERALLY. An Interest Holder's allocable
share of the Partnership's items of income (including income exempt from tax),
gain, deduction, loss and Nondeductible Expenditure for tax purposes shall be
determined under the foregoing provisions of this Article 6 except as provided
in this Section 6.7.
6.7.2. CONTRIBUTED PROPERTY. In accordance with Code
Section 704(c) and the Regulations thereunder, income, gain, loss and deduction
with respect to any property contributed to the capital of the Partnership
shall, solely for tax purposes, be allocated among the Interest Holders so as to
take account of any variation between the adjusted basis of such property to the
Partnership for federal income tax purposes and its initial Agreed Value,
determined in accordance with the definition of Agreed Value hereunder.
6.7.3. ADJUSTMENTS TO AGREED VALUE. If the Agreed
Value of any Partnership asset is adjusted pursuant to the definition of Agreed
Value hereunder, subsequent allocations of income, gain, loss and deduction with
respect to such asset for tax purposes shall take account of any variation
between the adjusted basis of such asset for federal income tax purposes and its
Agreed Value in the same manner as under Code Section 704(c) and the Regulations
thereunder.
6.7.4. ELECTIONS. Any elections or other decisions
relating to allocations pursuant to this Section 6.7 shall be made by the
General Partner in any manner that reasonably reflects the purpose and intention
of this Agreement. Allocations pursuant to this Section 6.7 are solely for
purposes of federal, state and local taxes and shall not affect, or in any way
be taken into account in computing, any Interest Holder's
15
Capital Account or share of Profits, Losses, other items or distributions
pursuant to any provision of this Agreement.
ARTICLE 7. TAX MATTERS
7.1. PREPARATION OF TAX RETURNS. The General Partner shall
arrange for the preparation and timely filing of all returns of Partnership
income, gains, losses, deductions, credits, and other items necessary for
federal, state and local income tax purposes and shall use reasonable best
efforts to furnish to the Interest Holders within ninety days after the close of
each taxable year of the Partnership the tax information reasonably required for
federal, state and local income tax reporting purposes. The classification,
realization, and recognition of income, gains, losses, deductions, credits, and
other items shall be on the accrual method of accounting for federal income tax
purposes, unless the General Partner shall elect otherwise in its sole
discretion in accordance with applicable law. The General Partner shall not
change the method of accounting initially elected by the Partnership (except if
required to do so by law) without the prior written consent of a Majority
Interest.
7.2. TAX ELECTIONS.
Except as provided in Section 7.1, the General Partner shall,
in its sole discretion, determine whether to make any election available under
the Code or any other applicable taxing statute; provided, however, (i) that the
General Partner shall not make an election to adjust the basis of property
pursuant to Code Sections 754, 734(b) and 743(b), or comparable provisions of
state or local law, without the prior written consent of a Majority Interest and
shall make such election if requested to do so by a Majority Interest, and (ii)
the General Partner shall not extend the statute of limitations for assessment
of tax deficiencies against the Interest Holders with respect to adjustments to
the Partnership's federal, state or local tax returns unless the Limited
Partners unanimously vote for such extension.
7.3. TAX CONTROVERSIES. The General Partner is designated as
the Tax Matters Partner (as defined in section 6231 of 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 of the Interest Holders agrees to cooperate with the General
Partner and to do or refrain from doing any and all things reasonably required
by the General Partner to conduct such proceedings.
ARTICLE 8. BUSINESS MANAGEMENT AND OPERATION;
INDEMNIFICATION
8.1. POWERS OF GENERAL PARTNER. Except as otherwise expressly
provided in this Agreement, all powers to control and manage the business and
affairs of the Partnership shall be exclusively vested in the General Partner,
and no Limited Partner
16
shall have any right or power to control or manage the business and affairs of
the Partnership.
Except as otherwise expressly provided in this Agreement, 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 provisions of this Agreement, the General Partner is hereby
authorized and empowered, in the name of and on behalf of the Partnership, to do
and perform any and all acts and things that it deems appropriate or necessary
in the conduct of the business and affairs of the Partnership, including,
without limitation, the following (but subject to the restrictions set forth in
the following), but only in furtherance of the purposes of the Partnership and
for the benefit of the Partnership:
8.1.1. To lend money and, without recourse to the
Partners: to borrow money, to assume, guarantee, or otherwise become
liable for indebtedness and other liabilities, and to issue evidences
of indebtedness and, in connection therewith, to authorize confession
of judgment against the Partnership;
8.1.2. To buy, lease (as lessor or lessee), sell,
mortgage or encumber (without personal recourse to the Partners), or
otherwise acquire or dispose of any or all of the assets of the
Partnership;
8.1.3. To invest the assets of the Partnership;
8.1.4. To purchase and sell products, services, and
supplies;
8.1.5. To make tax, regulatory, and other filings
with, and to render periodic and other reports to, governmental
agencies or bodies having jurisdiction over the assets or business of
the Partnership;
8.1.6. To open, maintain, and close bank accounts
and to draw checks and other orders for the payment of money;
8.1.7. To negotiate, execute, and perform any
contracts, conveyances, or other instruments;
8.1.8. To distribute cash and other property of the
Partnership in accordance with the provisions of this Agreement;
8.1.9. To utilize the services of employees of the
General Partner and of any other Persons and to select and dismiss
employees (if any) and outside attorneys, accountants, consultants, and
contractors;
8.1.10. To maintain insurance for the benefit of the
Partnership and the Partners;
17
8.1.11. To form, participate in, or contribute or
loan cash or property to limited or general partnerships, joint
ventures, corporations, or similar arrangements in which, in all cases
the Partnership shall have an ownership interest;
8.1.12. To expand the business activities in which
the Partnership is engaged or engage in new business activities by
acquisition or internal development;
8.1.13. To conduct litigation and incur legal
expenses and otherwise deal with or settle claims or disputes; and
8.1.14. To purchase or otherwise acquire Partnership
Interests from, or sell or otherwise or dispose of Partnership
Interests to, Persons other than the Partnership;
in each case at such times and upon such terms and conditions as the General
Partner deems appropriate or necessary, and subject to any express restrictions
contained elsewhere in this Agreement.
8.2. DUTIES OF GENERAL PARTNER. The General Partner shall
manage the business and affairs of the Partnership in the manner that the
General Partner deems appropriate or necessary. Without limiting the generality
of the foregoing, the General Partner's duties shall include the following:
8.2.1. To take possession of the assets of the
Partnership;
8.2.2. To staff and operate the business of the
Partnership;
8.2.3. To perform or cause to be performed financial,
accounting, logistical, and other administrative functions for the
Partnership;
8.2.4. To render such reports and make such periodic
and other filings as may be required under applicable federal, state,
and local laws, rules, and regulations;
8.2.5. To provide or cause to be provided purchasing,
procurement, repair, and other services for the Partnership; and
8.2.6. To conduct the business of the Partnership in
accordance with this Agreement and all applicable laws, rules, and
regulations;
in each case in such a manner as the General Partner deems appropriate or
necessary.
18
8.3. PROHIBITED ACTIONS AND ACTIONS REQUIRING LIMITED PARTNER
APPROVAL. Notwithstanding any other provisions of this Agreement to the contrary
the General Partner shall not take any of the following actions without the
prior consent of all of the Partners:
8.3.1. Change the nature of the Partnership business
or the purpose of the Partnership set forth in Section 2.7;
8.3.2. Amend the provisions contained in Articles 5
or 6;
8.3.3. Amend the provisions of this Section 8.3 or
the definitions of the defined terms used herein;
8.3.4. Terminate or dissolve the Partnership (except
for terminations or dissolutions by reason of the circumstances described in
Article 12);
8.3.5. Take any action or cause the Partnership to
take action that could cause the Partnership not to be recognized as a
partnership for federal income tax purposes; or
8.3.6. Admit to the Partnership any additional or
successor Partners or recognize the validity of any attempted transfer of an
interest in the Partnership except in accordance with the provisions of Article
10.
The foregoing rights granted to each Partner in this Section 8.3 shall include
only the right to grant or withhold consent to any of the foregoing actions that
are initiated or proposed by the General Partner and each Partner shall have no
right to require the General Partner to take any such action. If any consent of
any Partner with respect to any course of action to be taken or not taken by the
Partnership is requested, such consent shall not be unreasonably denied or
withheld; and if such Partner shall not respond within fifteen (15) days after
receipt of such request, such Partner shall be deemed to have given its consent
pursuant to such request, and the other Partners (i) shall be entitled to take
or refrain from taking any action in reliance thereon, and (ii) shall have no
liability to such Partner as a result of such action or inaction.
8.4. REIMBURSEMENT OF THE GENERAL PARTNER. The General Partner
shall be promptly reimbursed from the assets of the Partnership for all
reasonable and proper expenses incurred on behalf of the Partnership.
8.5. PARTNERSHIP FUNDS. The funds of the Partnership shall be
deposited in such account or accounts as shall be designated by the General
Partner and shall not be commingled with the funds of the General Partner. All
withdrawals from or charges against such accounts shall be made by the General
Partner or by its agents.
19
8.6. OUTSIDE ACTIVITIES.
8.6.1. The General Partner shall be entitled to and
may have business interests and engage in business activities in addition to
those relating to the Partnership, for its own account and for the account of
others, without having or incurring any obligation to offer any interest in such
businesses or activities to the Partnership or any Partner. Neither the
Partnership nor any of the Partners shall have any rights by virtue of this
Agreement or the Partnership relationship created hereby in any such business
interests.
8.6.2. The General Partner may lend to the
Partnership funds needed by the Partnership on such terms and for such periods
of time as the General Partner may determine; provided, however, that the
General Partner may not charge the Partnership an effective rate of interest
(including points or other financing charges or fees) greater than the effective
rate of interest (including points or other financing charges or fees) that
would be charged to the Partnership by unrelated lenders on loans with
comparable terms. The Partnership shall reimburse the General Partner for any
costs reasonably incurred by the General Partner in connection with the
borrowing of funds obtained by the General Partner and loaned to the
Partnership.
8.7. LIMITED LIABILITY; INDEMNIFICATION.
The General Partner will not be liable to the
Partnership or the Limited Partners for any act or omission by the General
Partner pursuant to the authority granted to it by this Agreement, except by
reason of fraud, bad faith, willful misfeasance, gross negligence or any act in
breach of this Agreement. The General Partner will indemnify and save harmless
the Partnership and the Limited Partners from any loss or liability arising out
of its fraud, bad faith, willful misfeasance, gross negligence or breach of this
Agreement. The Partnership will indemnify and save harmless the General Partner
from any loss or liability incurred by the General Partner by reason of any act
performed by the General Partner on behalf of the Partnership or in furtherance
of the Partnership's interest other than by reason of the General Partner's
fraud, bad faith, willful misfeasance, negligence or breach of this Agreement.
In the event the General Partner is found personally liable for any debts of the
Partnership (other than any debt or liability incurred by reason of the General
Partner's fraud, bad faith, willful misfeasance, negligence or breach of this
Agreement) and is required to and does satisfy a Partnership liability out of
its personal assets, the General Partner will have a right of reimbursement out
of the assets of the Partnership (the "Right of Reimbursement"). The Right of
Reimbursement will accrue to the General Partner 30 days after written notice
thereof is given to each of the other Partners. Upon such accrual of the Right
of Reimbursement, the General Partner will be reimbursed out of the assets of
the Partnership in the following order of priority, but only to the extent
necessary to satisfy such Right of Reimbursement: (i) out of the amounts then
available for distribution to Interest Holders pursuant to Section 5.1 or
Section 12.2; (ii) out of funds obtained by the Partnership from unsecured
borrowings by the Partnership without recourse to any Partner; (iii) out of
funds obtained by the
20
Partnership from sale or refinancing of the assets of the Partnership; and (iv)
out of funds obtained by the Partnership in any other manner; provided, however,
that before any such sale or refinancing is consummated, the General Partner
will have endeavored to obtain funds in the form of loans to the Partnership
from the Limited Partners in an amount sufficient to reimburse the General
Partner; and, provided further, that in the event the General Partner is to be
reimbursed out of the proceeds of a proposed sale or refinancing of the assets
of the Partnership, the General Partner will give 90 days prior written notice
of any such proposed sale or refinancing to each of the other Partners. If
sufficient funds described in clauses (i) or (ii) of the preceding sentence are
obtained and used by the Partnership to reimburse the General Partner prior to
the expiration of such 90-day period, such proposed sale or refinancing will not
be consummated unless all of the Partners consent thereto. To the extent not
reimbursed as provided above, the General Partner will have no right of
contribution from the Limited Partners.
8.8. BOOKS, RECORDS, AND ACCOUNTING.
8.8.1. The General Partner shall keep or cause to be
kept books and records with respect to the Partnership's business, which books
and records shall at all times be kept at the principal office of the
Partnership. The books of the Partnership shall be maintained, for financial
reporting purposes, under an accounting method that is consistent with the
accounting method selected under Section 7.1 for federal income tax purposes.
8.8.2. The Partnership shall also keep at its
principal office the following items:
(i) a current list of the full name and last
known business address or home address of each Partner;
(ii) a copy of the Certificate and all
certificates of amendment thereto, together with executed copies of any
powers of attorney pursuant to which any certificate has been
executed;
(iii) copies of the Partnership's federal, state,
and local income tax returns and reports, if any, for all Fiscal Years
since inception of the Partnership; and
(iv) copies of the then effective Partnership
Agreement and of any financial statements of the Partnership for the
three most recent years.
8.9. FISCAL YEAR; TAXABLE YEAR. The fiscal year of the
Partnership for financial accounting purposes and the taxable year of the
Partnership for income tax purposes shall be the Fiscal Year, unless the General
Partner shall determine otherwise in its sole discretion in accordance with
applicable law.
21
ARTICLE 9. LIMITED PARTNER RIGHTS AND OBLIGATIONS
9.1. LIMITATION OF LIABILITY. No Limited Partner shall have
liability for the debts, obligations, or liabilities of the Partnership.
9.2. MANAGEMENT OF BUSINESS. A Limited Partner shall not, in
its capacity as a Limited Partner, take part in the operation, management, or
control (within the meaning of the 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.
9.3. OUTSIDE ACTIVITIES. A Limited Partner shall be entitled
to and may have business interests and engage in business activities in addition
to those relating to the Partnership. Neither the Partnership nor any of the
other Partners shall have any rights by virtue of this Agreement or the
Partnership relationship created hereby in any business ventures of any Limited
Partner.
9.4. RETURN OF CAPITAL. A Limited Partner shall not be
entitled to the withdrawal or return of its Capital Contributions, except to the
extent provided for in this Agreement.
9.5. RIGHTS OF LIMITED PARTNERS. In addition to other rights
provided by this Agreement or by applicable law, a Limited Partner shall have
the right, upon reasonable demand, during ordinary business hours, and at the
Limited Partner's own expense:
(a) to inspect and copy any of the Partnership's
records maintained pursuant to Section 8.8.2;
(b) to obtain from the General Partner true and full
information regarding the state of the business and financial condition
of the Partnership;
(c) promptly after becoming available, to receive a
copy of the Partnership's federal, state, and local income tax returns
for each year; and
(d) to obtain such other information from the General
Partner regarding the affairs of the Partnership as is just and
reasonable.
22
ARTICLE 10. TRANSFERS OF INTERESTS
10.1. GENERAL PARTNER.
10.1.1. VOLUNTARY TRANSFERS AND WITHDRAWALS. The
General Partner shall not voluntarily resign or dissolve, or withdraw, transfer,
sell, assign or pledge all or any part of its GP Interest without the prior
written consent of all of the Limited Partners, which may be withheld in their
discretion. The withdrawing, transferring, selling or assigning General Partner
who has received the prior written consent of the Limited Partners to the
withdrawal, transfer, sale or assignment of all of its GP Interest, shall cease
to be the General Partner upon (i) the withdrawal, transfer, sale or assignment
of all of its GP Interest and (ii) the filing, in accordance with the provisions
of the Act, of an appropriate certificate of amendment to the Certificate. The
General Partner who withdraws, transfers, sells or assigns any portion, but less
than all, of its GP Interest with the consent of the Limited Partners, shall
continue to be the General Partner of the Partnership. If the General Partner
does resign or dissolve, or withdraw, transfer, sell or assign all or any part
of its GP Interest without the prior written consent of the Limited Partners,
the remaining Partners may proceed in accordance with the provisions of Section
12.1 hereof to continue the business of the Partnership. If the General Partner
shall request the Limited Partners' consent to a sale of all (but not less than
all) of its GP Interest pursuant to a bona fide written offer to purchase such
interest on a date (the "Proposed Purchase Date") that follows such request by
not less than 90 days and the Limited Partners shall withhold such consent, and
if the General Partner shall furnish to the Partnership an opinion of counsel,
which counsel and opinion shall be satisfactory to the Limited Partners, that
such sale will not cause the Partnership to terminate for federal income tax
purposes or to be classified as an association taxable as a corporation for
federal income tax purposes, then the General Partner shall (except in
connection with the dissolution of the Partnership) have the option to require,
subject to the proviso below, that the Limited Partners (ratably in proportion
to their respective Percentage Interests) or another willing Person designated
by a Majority Interest purchase the GP Interest for an amount equal to the
purchase price set out in such written offer, and payable on the same terms
contained in such written offer; provided, however, that the Limited Partners
(or such other purchaser designated by a Majority Interest) may elect instead to
purchase the GP Interest on the last day of the calendar month that includes the
Proposed Purchase Date for a cash purchase price (payable, if the Limited
Partners are the purchasers, ratably by the Limited Partners in proportion to
their respective Percentage Interests) equal to the positive balance, if any, in
the Capital Account of the General Partner as determined by closing the books of
the Partnership on the last day of such calendar month and payable within 30
days after the end of such calendar month.
10.1.2. INVOLUNTARY TRANSFERS. The successor in
interest to the General Partner by reason of the dissolution, liquidation or
other termination of the General Partner shall have the rights of an assignee to
receive only (i) the allocations of Profits, Losses and other items of
Partnership income, gain, deduction, loss and credit,
23
(ii) and the distributions of money or other property to which the General
Partner would have been entitled under the provisions of this Agreement. If,
following such dissolution, liquidation or other termination of the General
Partner, the Partnership has been continued pursuant to Section 12.1, and all of
the remaining Partners consent thereto (which consent may be withheld for any
reason), an appropriate amendment to this Agreement is executed and an
appropriate amendment to the Certificate is executed and filed, and the
successor in interest to the General Partner agrees to be bound by all of the
obligations of the General Partner hereunder, such successor in interest may be
admitted to the Partnership as a substitute General Partner.
10.1.3. PROHIBITED TRANSFERS. Any purported Transfer
of a GP Interest in the Partnership that is not authorized pursuant to this
Agreement shall be null and void and of no effect whatever.
10.2. LIMITED PARTNERS.
10.2.1. IN GENERAL. Except as hereinafter provided,
no Limited Partner may Transfer all or any part of its LP Interest.
10.2.2. PERMITTED TRANSFERS. Subject to the
conditions and restrictions set forth in Section 10.2.3 hereof, a Limited
Partner may at any time Transfer all or any portion of its interest in the
Partnership (a) to any Limited Partner, , or (b) subject to the prior written
consent of the General Partner, which may be withheld in its discretion, to any
Purchaser (any such Transfer being referred to in this Agreement as a "Permitted
Transfer").
10.2.3. CONDITIONS TO PERMITTED TRANSFERS. A Transfer
shall not be treated as a Permitted Transfer under Section 10.2.2 hereof unless
and until the following conditions are satisfied (except to the extent that a
General Partner shall waive any or all of such conditions):
10.2.3.1. The transferor and transferee
shall execute and deliver to the Partnership such documents and instruments of
conveyance as may be necessary or appropriate in the opinion of counsel to the
Partnership to effect such Transfer and to confirm the agreement of the
transferee to be bound by the provisions of this Section 10. In any case not
described in the preceding sentence, the Transfer shall be confirmed by
presentation to the Partnership of legal evidence of such Transfer, in form and
substance satisfactory to counsel to the Partnership. In all cases, the
Partnership shall be reimbursed by the transferor and/or transferee for all
costs and expenses that it reasonably incurs in connection with such Transfer.
10.2.3.2. The transferor shall furnish to
the Partnership an opinion of counsel, which counsel and opinion shall be
satisfactory to the Partnership, that the Transfer will not cause the
Partnership to terminate for federal income tax purposes.
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10.2.3.3. The transferor and transferee
shall furnish the Partnership with the transferee's taxpayer identification
number, sufficient information to determine the transferee's initial tax basis
in the interests transferred, and any other information reasonably necessary to
permit the Partnership to file all required federal and state tax returns and
other legally required information statements or returns. Without limiting the
generality of the foregoing, the Partnership shall not be required to make any
distribution otherwise provided for in this Agreement with respect to any
transferred interests until it has received such information.
10.2.3.4. The transferor shall provide an
opinion of counsel, which opinion and counsel shall be satisfactory to the
Partnership, to the effect that such Transfer is exempt from all applicable
registration requirements and that such Transfer will not violate any applicable
laws regulating the Transfer of securities.
10.2.4. PROHIBITED TRANSFERS. Any purported Transfer
of an LP Interest that is not a Permitted Transfer shall be null and void and of
no effect whatever.
ARTICLE 11. ADDITIONAL PARTNERS
The General Partner may admit additional or substitute
Partners to the Partnership only in accordance with the Act and only with the
prior consent of each Partner, which consent may be withheld for any reason.
Upon such an admission of any substitute or additional Partner, the General
Partner shall cause to be properly prepared, filed and executed: (i) pursuant to
the Act any amendment of the Certificate that is required by the Act by reason
of such admission and (ii) any amendment to any registration, certificate or
other document required by any State by reason of such admission.
ARTICLE 12. DISSOLUTION AND LIQUIDATION
12.1. DISSOLUTION. The Partnership shall be dissolved, and its
affairs shall be wound up, upon the first to occur of any of the following
events (each a "Dissolution Event"):
12.1.1. the expiration of its term as provided in
Section 2.5;
12.1.2. the withdrawal or bankruptcy of the General
Partner or any other event that results in a General Partner ceasing to
be a general partner in the Partnership under the Act, provided that
any such event shall not constitute a Dissolution Event if the
Partnership is continued pursuant to this Section 12.1;
12.1.3. a written election by all Limited Partners;
25
12.1.4. the sale of all or substantially all of the
properties of the Partnership; or
12.1.5. the occurrence of any other event that makes
it unlawful, impossible or impractical to carry on the business of the
Partnership;
provided, however, that upon the occurrence of any event set forth in Section
12.1.2, the Partnership shall not be dissolved or required to be wound up if
within one hundred eighty (180) days after such event a Majority Interest of the
remaining Partners agree in writing to continue the business of the Partnership
and to the appointment, effective as of the date of such event, of a successor
General Partner.
For purposes of this Section 12.1, bankruptcy of the General
Partner shall be deemed to have occurred when the General Partner: (i) makes an
assignment for the benefit of creditors; (ii) files a voluntary petition in
bankruptcy; (iii) is adjudged bankrupt or insolvent; (iv) files an application
or answer seeking for itself any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under any statute, law
or regulation; (v) files an answer or other pleading admitting or failing to
contest the material allegations of a petition or application filed against it
in any proceeding of a type referred to in clause (ii) or (iv); or (vi) seeks,
consents to or acquiesces in the appointment of a trustee, receiver or
liquidator of the General Partner or of all or any substantial part of its
properties. In addition, for purposes of this Section 12.1, bankruptcy of the
General Partner shall be deemed to have occurred if within 120 days after the
commencement of any proceeding against the General Partner seeking
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under any statute, law or regulation the proceeding has not
been dismissed or if within 90 days after the appointment without its consent or
acquiescence of a trustee, receiver or liquidator of the General Partner or of
all or any substantial part of its properties, the appointment is not vacated or
stayed, or within 90 days after the expiration of any such stay, the appointment
is not vacated.
12.2. LIQUIDATION. Upon dissolution of the Partnership, the
then General Partner, or in the event the General Partner has withdrawn from the
Partnership or become bankrupt (as defined in Section 12.1), a liquidator or
liquidating committee approved by a Majority Interest, shall be the liquidator
of the Partnership (the "Liquidator"). The Liquidator shall be entitled to
receive such compensation for its services as may be approved by a Majority
Interest. The Liquidator shall not resign at any time without fifteen days'
prior written notice and, if other than the General Partner, may be removed at
any time, with or without cause, by notice of removal approved by a Majority
Interest. Upon dissolution, resignation, or removal of the Liquidator, a
successor and substitute Liquidator (who shall have and succeed to all rights,
powers, and obligations of the original Liquidator) shall, within thirty days
thereafter, be approved by a Majority Interest. Except as expressly provided in
this Article 12, the Liquidator approved in the manner provided herein shall
have and may exercise, without further authorization or approval of any of the
parties hereto, all of the powers conferred upon
26
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) to the extent appropriate or necessary 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. The Liquidator shall liquidate the assets of
the Partnership and apply and distribute the proceeds of such liquidation in the
following order and priority, to the maximum extent permitted by law:
12.2.1. First, to pay the costs and expenses
of the winding up, liquidation and termination of the Partnership;
12.2.2. Then, to creditors of the
Partnership (including Interest Holders to the extent permitted by
law) in satisfaction of the Company's known debts and liabilities
(whether by payment or the making of provision for the known amount
thereof);
12.2.3. Then, to establish reserves adequate
to meet any and all contingent or unforeseen liabilities or
obligations of the Partnership, provided that at the expiration of
such period of time as the Liquidator may deem advisable, the balance
of such reserves remaining after the payment of such contingencies or
liabilities shall be distributed as hereinafter provided;
12.2.4. Then, to the Interest Holders, in
proportion to, and to the extent of, the positive balances in their
respective Capital Accounts adjusted pursuant to Article 6 to reflect
(i) their respective distributive shares of the income, gain, loss,
and deduction of the Partnership for the taxable year of the
Partnership in which the distribution in liquidation occurs up through
and including the date of distribution and (ii) all distributions made
to the Interest Holders during such taxable year up to but not
including such date.
12.2.5. The balance, if any, to the Partners
in proportion to their respective Partnership Interests.
12.3. DISTRIBUTION IN KIND. Notwithstanding the provisions of
Section 12.2 requiring the liquidation of the assets of the Partnership, but
subject to the order of priorities set forth therein, if on dissolution of the
Partnership the Liquidator determines that an immediate sale of part or all of
the Partnership's assets would be impractical or would cause undue loss to the
Partners, the Liquidator may, in its sole discretion, defer for a reasonable
time the liquidation of any assets except those necessary to satisfy liabilities
of the Partnership and may, in its sole discretion, distribute to the Partners,
as tenants in common, in lieu of cash, and as their interests may appear in
accordance with the provisions of Section 12.2.2, undivided interests in such
Partnership assets as the Liquidator deems not suitable for liquidation;
provided, however, that the Liquidator must comply with the liquidating
distribution timing requirements of Section 12.7 hereof.
27
Any distributions in kind shall be subject to such conditions relating to the
disposition and management thereof as the Liquidator deems reasonable and
equitable. By way of clarification, for purposes of determining the Interest
Holders' respective shares of income, gain, loss, and deduction of the
Partnership for the taxable year of the Partnership in which the distribution in
liquidation occurs and of adjusting the Capital Accounts of the Interest Holders
therefor in accordance with Section 12.2.2 and Article 6, the definitions herein
of "Agreed Value" and "Profits" and "Losses" require that Partnership assets to
be distributed in kind shall be considered to have been first sold at their fair
market values (taking Code Section 7701(g) into account) and the Profits or
Losses deemed realized therefrom shall be allocated among the Interest Holders
as if an actual sale had occurred, and the Capital Accounts of the Interest
Holders shall be adjusted to reflect such allocation in accordance with Article
6. The fair market value of any property distributed in kind shall be the value
determined by an appraiser selected by a Majority Interest unless the Partners
agree as to such fair market value.
12.4. CANCELLATION OF CERTIFICATE OF LIMITED PARTNERSHIP. Upon
the completion of the distribution of Partnership property pursuant to Sections
12.2 and 12.3, the Partnership shall be terminated, and the Liquidator (or the
Limited Partners if necessary) shall cause the cancellation of the Certificate
and all qualifications of the Partnership as a foreign limited partnership in
jurisdictions other than the Commonwealth of Pennsylvania and shall take such
other actions as may be necessary to terminate the Partnership.
12.5. NO GENERAL PARTNER LIABILITY FOR RETURN OF CAPITAL. No
General Partner shall be personally liable for 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.
12.6. WAIVER OF PARTITION. Each Partner hereby waives any
rights to partition of the Partnership's property.
12.7. COMPLIANCE WITH TIMING REQUIREMENTS OF REGULATIONS. In
the event that the Partnership is liquidated within the meaning of Regulations
Section 1.704-1(b)(2)(ii)(G), then (a) distributions shall be made pursuant to
Section 12.2 to the Interest Holders who have positive Capital Accounts in
compliance with the timing requirements of Regulations Section
1.704-1(b)(2)(ii)(B)(2); provided, however, that the Liquidator may exercise the
discretion set forth in Section 12.2.2. If any Interest Holder has a deficit
balance in its Capital Account (after giving effect to all contributions,
distributions and allocations for all taxable years, including the year during
which such liquidation occurs), such Interest Holder shall have no obligation to
make any contribution to the capital of the Partnership with respect to such
deficit, and such deficit shall not be considered a debt owed to the Partnership
or to any other Person for any purpose whatsoever.
12.8. NON-DISSOLVING CODE SECTION 708(B) TERMINATIONS.
Notwithstanding any other provision of this Section 12, in the event that the
Partnership
28
is liquidated within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g) but
no Dissolution Event has occurred, the Partnership's assets shall not be
liquidated, the Partnership's liabilities shall not be paid or discharged, and
the Partnership's affairs shall not be wound up.
12.9. ALLOCATIONS DURING THE PERIOD OF LIQUIDATION. Until the
date on which all of the assets of the Partnership have been distributed to the
Interest Holders pursuant to Section 12.2 hereof, the Interest Holders shall
continue to share Profits, Losses and other items of Partnership income, gain,
deduction and loss as provided in Article 6 hereof.
ARTICLE 13. AMENDMENT OF AGREEMENT
Amendments to this Agreement may be proposed by any Partner. A
proposed amendment shall be effective only when approved in writing by the
General Partner and a Majority Interest unless the consent of all Partners is
unambiguously required by the Act.
ARTICLE 14. GENERAL PROVISIONS
14.1. PERSONAL PROPERTY. The Partnership Interest of any
Partner shall be personal property for all purposes.
14.2. ADDRESSES AND NOTICES. Any notice, demand, request,
payment, or report required or permitted to be given or made to a Limited
Partner under this Agreement shall be in writing and shall be deemed given or
made when delivered in person or when sent by first class mail or by other means
of written communication to such Partner at such Partner's address as shown on
the signature page or pages hereof or to such other address as such Partner may
specify for the purpose by notice to the General Partner given in accordance
with this Section 14.2. Any notice to the Partnership or the General Partner
shall be deemed given if received in writing by the General Partner at the
General Partner's address as shown on the signature page or pages hereof or to
such other address as the General Partner may specify for the purpose by notice
to each Limited Partner in accordance with this Section 14.2.
14.3. HEADINGS. All article or section headings in this
Agreement are for convenience only and shall not be deemed to control or affect
the meaning or construction of any of the provisions hereof
14.4. BINDING EFFECT. This Agreement shall be binding upon and
inure to the benefit of the parties hereto (including the additional Persons
that become Partners as provided herein) and their heirs, executors,
administrators, successors, legal representatives, and assigns.
29
14.5. INTEGRATION. This Agreement constitutes the entire
Agreement among the parties pertaining to the subject matter hereof and
supersedes all prior agreements and understandings pertaining thereto.
14.6. 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 a waiver of any such breach or of any other covenant, duty,
agreement, or condition.
14.7. COUNTERPARTS. This Agreement may be executed in any
number of counterparts, all of which together shall constitute one agreement
binding on the parties hereto including the additional Persons that become
Interest Holders as provided herein.
14.8. SEVERABILITY. 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 hereof, or of such
provision in other respects, shall not be affected thereby.
14.9. APPLICABLE LAW. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the Commonwealth of
Pennsylvania, without reference to principles of choice of law or choice of
forum.
* * *
30
IN WITNESS WHEREOF, this Agreement of Limited Partnership of
EME Homer City Generation L.P. has been duly executed and entered into by the
General Partner and the Limited Partner on the date first above written.
GENERAL PARTNER
MISSION ENERGY WESTSIDE
18101 Von Karman Avenue, Suite 1700
Irvine, California 92612
By: /s/ James V. Iaco, Jr.
---------------------------------
Name: James V. Iaco, Jr.
Its: President
LIMITED PARTNER
CHESTNUT RIDGE ENERGY COMPANY
18101 Von Karman Avenue, Suite 1700
Irvine, California 92612
By: /s/ James V. Iaco, Jr.
---------------------------------
Name: James V. Iaco, Jr.
Its: President
31
SCHEDULE A
INITIAL CAPITAL CONTRIBUTION/PERCENTAGE INTEREST
CAPITAL PERCENTAGE
NAME INTEREST CONTRIBUTION INTEREST
Mission G.P.
----------------- ----------------
Chestnut Ridge L.P.
----------------- ----------------