Exhibit 3.2(ae)
JOINT VENTURE AGREEMENT
OF
PINERY JOINT VENTURE
THIS AGREEMENT made as of the 29th day of September, 1993.
BETWEEN:
ELLY COLORADO, INC.
a corporation incorporated under
the laws of the state of Colorado;
(hereinafter called "ER");
- -and-
NORMAN COLORADO, INC.
a corporation incorporated under
the laws of the state of Colorado;
(hereinafter called "NR");
- -and-
LARRY COLORADO, INC.
a corporation incorporated under
the laws of the state of Colorado;
(hereinafter called "LR");
- -and-
BRUCE COLORADO, INC.
a corporation incorporated under
the laws of the state of Colorado;
(hereinafter called "BF");
- -and-
HARRY COLORADO, INC.
a corporation incorporated under
the laws of the state of Colorado;
(hereinafter called "HR")
- -and-
SEYMOUR COLORADO, INC.
a corporation incorporated under
the laws of the state of Colorado;
(hereinafter called "SJ")
- -and-
HAYDN COLORADO, INC.
a corporation incorporated under
the laws of the state of Colorado;
(hereinafter called "HM")
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WHEREAS ER, NR, LR, BF, HR, SJ, and HM (herein collectively called the
"Venturers") desire to form a Colorado joint venture to own lands, to construct
homes and to market them, such lands to be designated from time to time.
AND WHEREAS the Venturers wish to enter into this Agreement for the
purpose of setting forth the various terms, provisions, and conditions governing
their respective interests in the Venture;
NOW THEREFORE, in consideration of the mutual covenants of the parties
hereinafter contained and for other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledge, it is hereby agreed this Joint
Venture Agreement of Pinery Joint Venture shall constitute the entire agreement
of the parties, as follows:
FORMATION
1. ER, NR, LR, BF, HR, SJ, and HM hereby form and constitute a Colorado
joint venture (the "Venture") for the purpose hereinafter set forth. The affairs
of the Venture shall be conducted in accordance with the provision of this
Agreement.
2. The purpose of the Venture is the acquisition of the Property, the
development thereof into serviced building lots (if needed), and the
construction of houses thereon, the sale thereof, and such other related
activities as the parties may agree upon.
3. The undivided interest of each Venturer in the Venture (hereinafter
referred to as "Proportionate Interest") shall be as follows:
ER - 28.00%
NR - 28.00%
LR - 18.00%
BF - 7.00%
HR - 7.00%
SJ - 7.00%
HM - 5.00%
FUNDING
4. The Venturers shall advance funds to the Venture from time to time as
required. These advances may be made in stages as the activities of the Venture
may reasonably require. The advances shall be made by each of the Venturers in
the following proportions. ER - 28.00%, NR - 28.00%, LR - 18.00%, BF - 7.00%, HR
- - 7.00%, SJ - 7.00% and HM - 5.00%. The advances shall be repaid pro rata and
pari passu and on no other basis.
In the event that any Veturer advances to the Venture an amount in excess
of its required proportionate share of advances as noted above, this amount
shall be referred to as a deficit loan. The Venturer making such advance shall
be entitled to repayment of the said deficit loan on demand and shall be
entitled to charge and be paid interest on the deficit loan at a rate which is
four (4%) per cent per annum greater than the prime rate charged by the bank of
Nova Scotia to its most credit worthy customers on U.S. Dollar demand loans, but
in no event shall the rate of interest exceed the
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maximum permitted by law. These repayments shall be made in priority to any
other amounts advanced pursuant to Section 4 herein.
BORROWED MONEYS
5. The Venturers shall have the authority to borrow money in the name of
and on behalf of the Joint Venture, for the purpose of the Venture, upon
approval of Venturers owning Proportionate Interests of not less than fifty-one
(51%) per cent.
SECURITY FOR BORROWED MONEYS
6. The Venturers hereby covenant and agree to pledge the assets of the
Venture and to give such guarantees and other security in such form as may be
required by any lender in order to obtain the financing contemplated in Section
5 hereof.
FISCAL YEAR
7. The fiscal year of the Venture shall end on the 31st day of May of each
year.
APPOINTMENT OF AUDITOR, OR ACCOUNTANT
8. The Venture appoints Messrs. Peat Harwick Thorne its accountants or
auditors. That firm shall be engaged to, at the end of each fiscal year of the
tenure and at such other times as may be reasonably required by one of the
Venturers, make an audit, if requested by any Venturer, at such Venturer's
expense, of the books and accounts of the Venture and for such purpose shall
have access to all books of account, records, and all vouchers, cheques, papers
and documents of or which may relate to the Venture. The Venture shall cause its
accountants to furnish copies of all financial statements prepared for or on
behalf of or in connection with the Venture to each of the Venturers forthwith
after their preparation.
MAINTENANCE OF BANK ACCOUNT
9. The Venturers shall maintain for and on behalf of the Venture, a bank
account (herein called the "Venture Bank Account") to which shall be deposited
all receipts of every nature and kind whatsoever from the Venture.
RECEIPT AND DISBURSEMENT OF FUNDS
10. The Venture Bank Account shall be used solely for the purpose of the
receipt and disbursement of funds as aforesaid and for no other purpose, it
being the express intention of the Venturers that under no circumstances shall
the funds to be received or disbursed as required herein be co-mingled with any
other funds of the Venturers.
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RECORDS AND BOOKS OF ACCOUNT
11. Proper books of account, bank records and reconciliations for all bank
accounts referred to in this Agreement, such financial records as are reasonably
required by the accountant appointed from time to time pursuant to Section 8
hereof and copies of all contracts, agreements, correspondence and similar
material shall be kept by the Venture, and entries shall be made therein of all
such matters, terms, transactions and things as are usually written and entered
in books of account kept by others engaged in an enterprise of a similar
nature. Euch of the Venturers and their representatives, agents or nominees
shall have free access at all reasonable times to inspect, examine, audit and
copy all records and documents at its own expense. Each Venturer shall at all
times furnish to the others, correct information, accounts and statements of and
concerning all such transactions without concealment or suppression.
The Venture shall cause to be prepared and furnished to each of the
Venturers promptly after the close of each fiscal year of the Venture an
unaudited annual statement showing the operations of the Venture for such
period, the balance of each Venturer's capital account, the unpaid balance due
under all obligations of the Venture, a balance sheet of the Venture dated as at
the end of the fiscal year, a related statement of income or loss for the
Venture for such fiscal year and such other information as may be reasonably
requested by the Venturers.
APPLICATION AND DISTRIBUTION OF REVENUES
12. All receipts and revenues of the Venture from any source shall be
applied and distributed in the following order of priority with no distribution
being made in any category set forth below unless and until the preceding
category has been satisfied in full either by payment or by setting aside of a
cash reserve for payment of same.
a) in payment of all debts, obligations, liabilities, costs and expenses
incurred in connection with or on account of the Venture;
b) in repayment of deficit loans and accrued interest thereon as set
forth in Section 4 herein;
c) in repayment of advances by the Venturers subject to the provisions of
Section 4 herein;
d) after having satisfied (a), (b) and (c) above, receipts and revenues
of the Venture shall represent the profits of the venture and shall be
distributed in the following order of priority;
i) the advances made by the venturers to the venture pursuant to
Section 4 herein shall hear interest at a rate which is two (2%) per cent
per annum greater than the prime rate charged by the Bank of Nova Scotia to
its most credit worthy customers on U.S. Dollar demand loans, but in no
event shall the rate of interest exceed the maximum rate permitted by law,
from the date of such advance until repaid to such Venturer in accordance
with Section 12(c) above.
(ii) after having satisfied (a), (b), (c) and (d)(i) above, the
receipts and revenues of the Venture shall be distributed to the Venturers
pro rata and pari passu in accordance with their proportionate Interests.
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However, no distribution of profits shall be made until after completion of any
development and/or construction activities undertaken by the venture, without
the agreement of the venturers owning proportionate Interests of not less than
fifty-one (51%) percent.
INDEMNITY
13. All liabilities of the venture shall be borne by the Venturers in
accordance with their respective Proportionate Interest in the Venture. If any
of the Venturers or any principal of any of the Venturers shall become a surety
or guarantor of the Venture or otherwise become indebted or liable for any
monies borrowed by or on behalf of the Venture or for any obligation entered
into by or on behalf of the Venture each Venturer shall indemnify the other, or
the principal aforementioned, with the intent and purpose that all such
liabilities and obligations shall be borne by the Venturers in the proportions
aforementioned.
MANAGEMENT OF VENTURE AND
EXECUTION OF DOCUMENTS
14 (a) The management of the Venture shall be vested with Venturers owning
Proportionate Interests of not less than fifty-one (51%) per cent.
(b) All deeds, transfers, contracts, agreements and other documents
required to be executed by or on behalf of the Venture, from time to time,
including but not limited to checks and documents to open and/or close checking
accounts for the Venture, shall be executed on the Venture's behalf by an
authorized signing officer of either Seymour Colorado, Inc. or Harry Colorado
Inc. as authorized representative of the Venture. The signed statement of Harry
Rosenbaum or Seymour Joffe as an officer of either of those entities reciting
that such entity has authority to undertake any such act, when delivered to any
third party, shall be all the evidence such third party shall need concerning
the capacity of such person and such third party shall be entitled to rely upon
such statement and shall not be required to inquire further as to any of the
facts contained in such statement, said facts being deemed to be true insofar as
such third party is concerned after delivering such statement, the individual by
his signature alone, may sign any investment and bind the Venture.
RESTRICTION
15. Except with the prior written consent of the Venturers the respective
undivided interest of each Venturer in the Venture, (collectively referred to as
the Venture Interest) shall not be transferred, assigned, sold, mortgaged,
charged or in any other way encumbered, disposed of, or dealt with, without the
consent in writing of all the other Venturers. No Venturer shall have the right
to partition any venture assets, no shall any Venturer make any application to
any Court or other authority having jurisdiction over the matter, nor commence
nor prosecute any proceeding for the partition of Property or any part thereof.
NON ARMS-LENGTH TRANSFER
16. Notwithstanding the provisions of Section 15 hereof, any venturer shall
be free to transfer, sell or assign in whole or in part its interest in the
Venture, to any corporation which is a related corporation as determined under
the appropriate taxing legislation including any amendments thereto, in which
event the
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following provisions shall apply thereto;
a) No transfer sale or assignment pursuant to this Section, shall be made
unless at the time of such transfer, sale or assignment, the
transferee agrees to be bound by the terms of this Agreement and
become a party hereto by executing a counterpart of this Agreement.
b) In the event of a transfer, sale or assignment pursuant to this
section, the transferor shall not be relieved of its liability or
obligations hereunder and shall continue to be bound by all of the
terms and conditions of the Agreement.
BUSINESS NAME
17. The parties agree that the Venture may register as a proprietorship
name, the name "PINERY JOINT VENTURE". The affairs of the Venture may be
publicized under that name.
ARBITRATION
18. If, at any time or from time to time during the continuance of the
Venture or after the dissolution or other termination thereof, any dispute,
difference or question shall arise between any of the parties hereto, or their
successors, assigns or nominees, touching or concerning the venture or the
property, assets, rights or transactions thereof, or the dissolution or other
termination thereof, or the Property or the construction, meaning or effect of
this Agreement, or any provision hereof, or the rights of obligations of the
parties hereto, or their successors, assigns or nominees, under this Agreement
or otherwise, with respect thereto, then every such dispute, difference or
question shall be submitted to and settled by arbitration and the decision of
the arbitrator appointed as hereinafter provided to deal with such matter shall
be accepted by all the parties to such dispute, difference or question. The
arbitration shall be conducted by a single arbitrator agreed upon by the parties
to the matter. The decision of the Arbitrator shall be final and binding upon
all the parties to such dispute, difference or question and their nominees, and
there shall be no appeal therefrom.
AMENDMENTS IN WRITING
19. No amendment, alterations, addition, change or deletion to this
Agreement shall be binding on the parties hereto unless made in writing and
signed by all the parties hereto.
AGREEMENT PREVAILS
20. This agreement supersedes, and shall be deemed conclusively to
supersede, for all purposes, any agreement, whether evidenced in writing or
otherwise, heretofore entered into by the parties hereto governing or purporting
to govern the rights and obligations of the parties hereto with respect to the
Venture, and the Property; and this Agreement is hereby confirmed to contain all
terms and provisions agreed upon by the parties, there being no other agreement
between the parties with respect to the Property, or otherwise excepting only as
is specifically contained herein.
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TIME OF THE ESSENCE
21. Time shall be of the essence of this Agreement and of every part
hereof.
TERMINATION
22. This Agreement shall terminate upon the earlier of the agreement in
writing to terminate executed by the parties hereto or the full completion of
the purpose of the Venture as defined in Section 2 hereof and the disbursement
of all receipts of the Venture in accordance with Section 12 hereof and the
completion of each and every financial statement or reporting requirement
herein.
TAX MATTERS PARTNER
23. The Venturers hereby designate ER as the Tax Matters Partner for the
Venture as defined in Section 6.23 (a)(7) of the Internal Revenue Code of 1986
and the regulations promulgated thereunder.
MOTIONS
24. Any notice, statement, document or any other communication required or
desired to be given to any party hereto in connection with this Agreement or
arising out of it shall be in writing and shall be deemed to have been given
five (5) days after being posted to the party to whom addressed at the following
address or at such other address as the Venturer may advise in writing:
ER 15851 Dallas Parkway
Suite 100
Dallas, Texas 75248
Attention: Elly Reisman
NR 15851 Dallas Parkway
Suite 100
Dallas, Texas 75248
Attention: Norman Reisman
LR 15851 Dallas Parkway
Suite 100
Dallas, Texas 75248
Attention: Larry Robbins
BT 15851 Dallas Parkway
Suite 100
Dallas, Texas 75248
Attention: Bruce Freeman
MR 15851 Dallas Parkway
Suite 100
Dallas, Texas 75248
Attention: Harry Rosenbaum
SJ 15851 Dallas Parkway
Suite 100
Dallas, Texas 75248
Attention: Seymour Joffe
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HM 15851 Dallas Parkway
Suite 100
Dallas, Texas 75248
Attention: Haydn Matthews
With a copy to: 250 Lesmill Road
Don Mills, Ontario
Canada M3B 2T5
Attention: Harry Rosenbaum
FREEDOM OF ACTION
25. Each Venturer shall have the right to engage in other businesses or
ventures for its own individiual profit without any accountability to the other
Venturer, even if such other businesses or ventures are similar to or compete
with the Property. A Venturer shall not, by reason of this Agreement, have any
interest in any other business or venture if similar to or competes with the
Property.
INSOLVENCY
26. In the event that any party thereto shall, during the term hereof, make
an assignment for the benefit of creditors or a trustee or receiver of the
assets or any party shall commit an act of bankruptcy which is not cured within
thirty (30) days of the giving of a written notice thereof by any other party
hereto, the remaining parties hereto shall thereupon have the first option to
purchase in proportion to their respective interests the beneficial interest of
such party in the Venture, from the party or its trustee or receiver, or failing
any such beneficial interest. The said fair market value shall be final and
binding upon the parties. The option provided for herein shall be for a period
of thirty (30) days after the happening of an event referred to herein, and the
resulting agreement of purchase and sale shall be completed within thirty (30)
days thereafter.
GOVERNING LAW
27. This Agreement is entered into and is to be performed under the laws of
the State of Colorado.
IN WITNESS WHEREOF the parties hereto have duly executed this
Agreement by their respective officers in that regard.
ELLY COLORADO, INC.
a Colorado corporation
Per: /s/ Harry Rosenbaum
-----------------------------------
Name: Harry Rosenbaum
Title: Vice President
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NORMAN COLORADO, INC.
a Colorado corporation
Per: /s/ Harry Rosenbaum
-----------------------------------
Name: Harry Rosenbaum
Title: Vice President
LARRY COLORADO, INC.
a Colorado corporation
Per: /s/ Harry Rosenbaum
-----------------------------------
Name: Harry Rosenbaum
Title: Vice President
BRUCE COLORADO, INC.
a Colorado corporation
Per: /s/ Harry Rosenbaum
-----------------------------------
Name: Harry Rosenbaum
Title: Vice President
HARRY COLORANDO, INC.
a Colorado corporation
Per: /s/ Harry Rosenbaum
-----------------------------------
Name: Harry Rosenbaum
Title: Vice President
SEYMOUR COLORADO, INC.
a Colorado corporation
Per: /s/ Harry Rosenbaum
-----------------------------------
Name: Harry Rosenbaum
Title: Vice President
HAYDN COLORADO, INC.
a Colorado corporation
Per: /s/ Harry Rosenbaum
-----------------------------------
Name: Harry Rosenbaum
Title: Vice President
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