Unassociated Document
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
6-K
REPORT
OF FOREIGN PRIVATE ISSUER
PURSUANT
TO RULE 13A-16 OR 15D-16 OF THE
SECURITIES
EXCHANGE ACT OF 1934
DATED:
June 29, 2009
Commission
File No. 001-33811
NAVIOS
MARITIME PARTNERS L.P.
85
AKTI MIAOULI STREET, PIRAEUS, GREECE 185 38
(Address
of Principal Executive Offices)
Indicate
by check mark whether the registrant files or will file annual reports under
cover of Form 20-F or Form 40-F.
Form
20-F x Form
40-F o
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(1):
Yes o No x
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(7):
Indicate
by check mark whether the registrant by furnishing the information contained in
this Form is also thereby furnishing the information to the Commission pursuant
to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
If
“Yes” is
marked, indicate below the file number assigned to the registrant in connection
with Rule 12g3-2(b):
N/A
On June
29, 2009, pursuant to the previously executed Subscription Agreement dated June
9, 2009, between Navios Maritime Partners L.P. (“Navios Partners”) and Navios
Maritime Holdings Inc. (“Navios Holdings”), Navios Partners issued 1.0 million
of a new series of subordinated units designated the Subordinated Series A Units
(the “Series A Units”). The Series A Units are not eligible to receive cash
distributions until the earlier of a change of control of Navios Partners or
June 29, 2012, at which time the Series A Units automatically convert into
common units and receive distributions in accordance with all other common
units. The rights of the holder of the Series A Units and the
provisions regarding the Series A Units are as set forth in the Second Amended
and Restated Agreement of Limited Partnership of Navios Maritime Partners L.P.
dated June 29, 2009. A copy of the Second Amended and Restated
Agreement of Limited Partnership is filed as Exhibit 3.1 as part of this
Report.
In
accordance with the Subscription Agreement, upon issuance of the Series A Units,
the parties entered into the Amendment to Share Purchase Agreement, dated June
29, 2009, whereby Navios Holdings relieved Navios Partners from its obligation
to purchase the Capesize vessel TBN I for $130.0 million and granted Navios
Partners a 12-month option to purchase the TBN I for $125.0
million. A copy of the Amendment to Share Purchase Agreement is filed
as Exhibit 10.1 as part of this Report.
In
addition, the parties identified therein executed on June 29, 2009 the
Amendment to Omnibus Agreement whereby Navios Partners released, until June 29,
2011, Navios Holdings of the rights of first offer and restrictions on the types
of vessels that may be acquired as originally identified under the Omnibus
Agreement, dated November 16, 2007, into which the parties identified
therein previously entered. A copy of the Amendment to Omnibus
Agreement is filed as Exhibit 10.2 as part of this Report.
Furthermore,
pursuant to a waiver dated June 29, 2009 (the “Waiver”), Navios Partners
released, until June 29, 2011, Navios Maritime Acquisition Corporation (“Navios
Acquisition”) of its right of first refusal with respect to vessels Navios
Acquisition has to offer for sale to Navios Partners if acquired by Navios
Acquisition pursuant to the Right of First Refusal and Corporate Opportunities
Agreement, dated June 25, 2008, into which the parties identified
therein previously entered. A copy of the Waiver is filed as Exhibit
10.3 as part of this Report.
The
information contained in this Report is hereby incorporated by reference into
the Registration Statement on Form F-3, File No. 333-157000.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this Report to be signed on its behalf by the undersigned, thereunto
duly authorized.
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NAVIOS
MARITIME PARTNERS L.P.
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By:
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/s/
Angeliki Frangou |
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Angeliki
Frangou
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Chief
Executive Officer
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Date: July
14, 2009
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Exhibit
Index
Exhibit
No.
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Exhibit
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3.1
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Second
Amended and Restated Agreement of Limited Partnership dated June 29,
2009.
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10.1
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Amendment
to Share Purchase Agreement dated June 29, 2009. |
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10.2
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Amendment
to Omnibus Agreement dated June 29, 2009. |
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10.3
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Waiver
dated June 29,
2009. |
Unassociated Document
SECOND
AMENDED AND RESTATED
AGREEMENT
OF LIMITED PARTNERSHIP
OF
NAVIOS
MARITIME PARTNERS L.P.
TABLE
OF CONTENTS
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Page
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ARTICLE
I
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DEFINITIONS
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1
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Section
1.1
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Definitions
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1
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Section
1.2
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Construction
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16
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ARTICLE
II
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ORGANIZATION
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16
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Section
2.1
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Formation
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16
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Section
2.2
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Name
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17
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Section
2.3
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Registered
Office; Registered Agent; Principal Office; Other Offices
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17
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Section
2.4
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Purpose
and Business
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17
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Section
2.5
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Powers
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17
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Section
2.6
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Power
of Attorney
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17
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Section
2.7
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Term
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18
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Section
2.8
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Title
to Partnership Assets
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19
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ARTICLE
III
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RIGHTS
OF LIMITED PARTNERS
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19
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Section
3.1
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Limitation
of Liability
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19
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Section
3.2
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Management
of Business
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19
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Section
3.3
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Outside
Activities of the Limited Partners
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19
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Section
3.4
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Rights
of Limited Partners
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19
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ARTICLE
IV
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CERTIFICATES;
RECORD HOLDERS; TRANSFER OF PARTNERSHIP INTERESTS
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20
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Section
4.1
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Certificates
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20
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Section
4.2
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Mutilated,
Destroyed, Lost or Stolen Certificates
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20
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Section
4.3
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Record
Holders
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21
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Section
4.4
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Transfer
Generally
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21
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Section
4.5
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Registration
and Transfer of Limited Partner Interests
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22
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Section
4.6
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Transfer
of the General Partner’s General Partner Interest
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22
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Section
4.7
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Transfer
of Incentive Distribution Rights
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23
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Section
4.8
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Restrictions
on Transfers.
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23
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ARTICLE V
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CAPITAL
CONTFUBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS
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24
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Section
5.1
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Contributions
Prior to the Closing Date
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24
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Section
5.2
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Initial
Unit Issuances
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24
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Section
5.3
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Contributions
By Initial Limited Partners and Distributions to the General Partner
and its Affiliates
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24
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Section
5.4
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Interest
and Withdrawal
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25
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Section
5.5
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Issuances
of Additional Partnership Securities
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25
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Section
5.6
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Limitations
on Issuance of Additional Partnership Securities
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26
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Section
5.7
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Conversion
of Subordinated Units
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26
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Section
5.8
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Conversion
of Subordinated Series A Units
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26
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Section
5.9
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Limited
Preemptive Right
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27
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Section
5.10
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Splits
and Combinations
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27
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Section
5.11
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Fully
Paid and Non-Assessable Nature of Limited Partner
Interests
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27
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ARTICLE
VI
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DISTRIBUTIONS
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28
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Section
6.1
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Requirement
and Characterization of Distributions; Distributions to Record
Holders
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28
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Section
6.2
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Distributions
of Available Cash from Operating Surplus
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28
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Section
6.3
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Distributions
of Available Cash from Capital Surplus
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30
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Section
6.4
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Adjustment
of Minimum Quarterly Distribution and Target
Distribution Levels
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30
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Section
6.5
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Special
Provisions Relating to the Holders of Subordinated Units
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30
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Section
6.6
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Special
Provisions Relating to the Holders of Subordinated Series A
Units
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31
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Section
6.7
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Special
Provisions Relating to the Holders of Incentive Distribution
Rights
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31
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ARTICLE
VII
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MANAGEMENT
AND OPERATION OF BUSINESS
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31
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Section
7.1
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Management
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31
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Section
7.2
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The
Board of Directors; Election and Appointment; Term; Manner
of Acting
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32
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Section
7.3
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Nominations
of Elected Directors
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33
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Section
7.4
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Removal
of Members of Board of Directors
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33
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Section
7.5
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Resignations
of Members of the Board of Directors
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33
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Section
7.6
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Vacancies
on the Board of Directors
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33
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Section
7.7
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Meetings;
Committees; Chairman
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34
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Section
7.8
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Officers
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35
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Section
7.9
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Compensation
of Directors
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36
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Section
7.10
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Certificate
of Limited Partnership
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37
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Section
7.11
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Restrictions
on the Authority of the Board of Directors and the
General Partner
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37
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Section
7.12
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Reimbursement
of the General Partner
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37
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Section
7.13
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Outside
Activities
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38
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Section
7.14
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Loans
from the General Partner; Loans or Contributions from the Partnership
or Group Members
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39
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Section
7.15
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Indemnification
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40
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Section
7.16
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Liability
of Indemnitees
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41
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Section
7.17
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Resolution
of Conflicts of Interest; Standards of Conduct and Modification of
Duties
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42
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Section
7.18
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Other
Matters Concerning the General Partner and the Board of
Directors
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43
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Section
7.19
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Purchase
or Sale of Partnership Securities
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43
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Section
7.20
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Registration
Rights of the General Partner and its Affiliates
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44
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Section
7.21
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Reliance
by Third Parties
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46
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ARTICLE
VIII
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BOOKS.
RECORDS. ACCOUNTING AND REPORTS
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46
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Section
8.1
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Records
and Accounting
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46
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Section
8.2
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Fiscal
Year
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46
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Section
8.3
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Reports
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ARTICLE
IX
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TAX
MATTERS
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47
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Section
9.1
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Tax
Elections and Information
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47
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Section
9.2
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Withholding.
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47
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Section
9.3
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Conduct
of Operations
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47
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ARTICLE
X
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ADMISSION
OF PARTNERS
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47
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Section
10.1
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Admission
of Initial Limited Partners
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Section
10.2
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Admission
of Additional Limited Partners
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48
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Section
10.3
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Admission
of Successor General Partner
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48
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Section
10.4
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Amendment
of Agreement and Certificate of Limited Partnership
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48
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ARTICLE
XI
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WITHDRAWAL
OR REMOVAL OF PARTNERS
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49
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Section
11.1
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Withdrawal
of the General Partner
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Section
11.2
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Removal
of the General Partner
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50
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Section
11.3
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Interest
of Departing General Partner and Successor General Partner
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51
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Section
11.4
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Termination
of Subordination Period, Conversion of Subordinated Units and
Subordinated Series A Units, and Extinguishment of Cumulative Common
Unit Arrearages
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52
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Section
11.5
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Withdrawal
of Limited Partners
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52
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ARTICLE
XII
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DISSOLUTION
AND LIQUIDATION
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52
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Section
12.1
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Dissolution
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52
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Section
12.2
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Continuation
of the Business of the Partnership After Dissolution
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53
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Section
12.3
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Liquidator
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53
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Section
12.4
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Liquidation
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53
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Section
12.5
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Cancellation
of Certificate of Limited Partnership
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55
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Section
12.6
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Return
of Contributions
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55
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Section
12.7
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Waiver
of Partition
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55
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ARTICLE
XIII
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AMENDMENT
OF PARTNERSHIP AGREEMENT; MEETINGS; RECORD DATE
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55
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Section
13.1
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Amendments
to be Adopted Without Approval of the Limited Partners or the General
Partner
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55
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Section
13.2
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Amendment
Procedures
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56
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Section
13.3
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Amendment
Requirements
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57
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Section
13.4
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Special
Meetings
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57
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Section
13.5
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Notice
of a Meeting
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58
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Section
13.6
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Record
Date
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58
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Section
13.7
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Adjournment
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58
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Section
13.8
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Waiver
of Notice; Approval of Meeting; Approval of Minutes
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58
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Section
13 .9
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Quorum
and Voting
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58
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Section
13.10
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Conduct
of a Meeting
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59
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Section
13.11
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Action
Without a Meeting
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59
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Section
13.12
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Right
to Vote and Related Matters
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59
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ARTICLE
XIV
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MERGER
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60
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Section
14.1
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Authority
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60
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Section
14.2
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Procedure
for Merger or Consolidation
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60
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Section
14.3
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Approval
by Limited Partners of Merger or Consolidation
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61
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Section
14.4
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Certificate
of Merger
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62
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Section
14.5
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Amendment
of Partnership Agreement
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62
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Section
14.6
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Effect
of Merger
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62
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ARTICLE
XV
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RIGHT
TO ACQUIRE LIMITED PARTNER INTERESTS
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62
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Section
15.1
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Right
to Acquire Limited Partner Interests
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62
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ARTICLE
XVI
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GENERAL
PROVISIONS
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64
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Section
16.1
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Addresses
and Notices
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64
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Section
16.2
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Further
Action
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64
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Section
16.3
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Binding
Effect
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64
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Section
16.4
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Integration
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64
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Section
16.5
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Creditors
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64
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Section
16.6
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Waiver
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64
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Section
16.7
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Counterparts
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64
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Section
16.8
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Applicable
Law
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64
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Section
16.9
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Invalidity
of Provisions
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65
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Section
16.10
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Consent
of Partners
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65
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Section
16.11
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Facsimile
Signatures
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65
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Section
16.12
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Third-Party
Beneficiaries
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65
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SECOND
AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP
OF NAVIOS MARITIME PARTNERS L.P.
THIS
SECOND AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF NAVIOS MARITIME
PARTNERS L.P., dated as of June 10, 2009, is entered into by and among Navios GP
L.L.C., a Marshall Islands limited liability company, as the General Partner,
and Navios Maritime Holdings Inc. (or any permitted successors and assigns
hereunder), as the Organizational Limited Partner, together with any other
Persons who become Partners in the Partnership or parties hereto as provided
herein.
RECITALS
WHEREAS, Navios GP L.L.C. and Navios
Maritime Holdings Inc. formed the Partnership pursuant to the First Amended and
Restated Agreement of Limited Partnership of Navios Maritime Partners L.P. dated
as of November 16, 2007 (the “Prior Agreement”) and
a Certificate of Limited Partnership, which was filed with the registrar of the
Republic of the Marshall Islands on such date; and
WHEREAS, the Partners of the
Partnership now desire to amend and restate the Prior Agreement to reflect the
issuance of a series of subordinated units as the Subordinated Series A Units
and related matters in connection with such issuance.
NOW, THEREFORE, in consideration of the
covenants, conditions and agreements contained herein, the parties agree as
follows:
ARTICLE
I
Section
1.1 Definitions. The
following definitions shall be for all purposes, unless otherwise clearly
indicated to the contrary, applied to the terms used in this
Agreement.
“Acquisition” means
any transaction in which any Group Member acquires (through an asset
acquisition, merger, stock acquisition or other form of investment) control over
all or a portion of the assets, properties or business of another Person for the
purpose of increasing the operating capacity or asset base of the Partnership
Group from the operating capacity or asset base of the Partnership Group
existing immediately prior to such transaction;
provided, however, that any
acquisition of properties or assets of another Person that is made solely for
investment purposes shall not constitute an Acquisition under this
Agreement.
“Adjusted Operating
Surplus” means, with respect to any period, Operating Surplus generated
with respect to such period (a) less (i) any net increase in Working Capital
Borrowings with respect to such period and (ii) any net decrease in cash
reserves for Operating Expenditures (or the Partnership’s proportionate share of
any net increase in Working Capital Borrowings in the case of Subsidiaries that
are not wholly owned) with respect to such period to the extent such reduction
does not relate to an Operating Expenditure made with respect to such period,
and (b) plus (i) any net decrease in Working Capital Borrowings (or the
Partnership’s proportionate share of any net decrease in Working Capital
Borrowings in the case of Subsidiaries that are not wholly owned) with respect
to such period, and (ii) any net increase in cash reserves (or the Partnership’s
proportionate share of any net increase in cash reserves in the case of
Subsidiaries that are not wholly owned) for Operating Expenditures with respect
to such period to the extent such reserve is required by any debt instrument for
the repayment of principal, interest or premium. Adjusted Operating Surplus does
not include that portion of Operating Surplus included in clause (a)(i) of the
definition of Operating Surplus.
“Affiliate” means,
with respect to any Person, any other Person that directly or indirectly through
one or more intermediaries controls, is controlled by or is under common control
with, the Person in question. As used herein, the term “control” means the
possession, direct or indirect, of the power to direct or cause the direction of
the management and policies of a Person, whether through ownership of voting
securities, by contract or otherwise.
“Agreed Value” means
the fair market value of the applicable property or other consideration at the
time of contribution or distribution, as the case may be, as determined by the
Board of Directors.
“Agreement” means this
Second Amended and Restated Agreement of Limited Partnership of Navios Maritime
Partners L.P., as it may be amended, supplemented or restated from time to
time.
“Amadeus Maritime”
means Amadeus Maritime S.A., a Panama corporation.
“Annual Meeting” means
the meeting of Limited Partners to be held every year commencing in 2008 to
elect the Elected Directors as provided in Section 7.2 and to vote on any other
matters brought before the meeting in accordance with this
Agreement.
“Appointed Directors”
means the members of the Board of Directors appointed by the General Partner in
accordance with the provisions of Article VII.
“Associate” means,
when used to indicate a relationship with any Person: (a) any corporation or
organization of which such Person is a director, officer or partner or is,
directly or indirectly, the owner of 20% or more of any class of voting stock or
other voting interest; (b) any trust or other estate in which such Person has at
least a 20% beneficial interest or as to which such Person serves as trustee or
in a similar fiduciary capacity; and (c) any relative or spouse of such Person,
or any relative of such spouse, who has the same principal residence as such
Person.
“Audit Committee”
means a committee of the Board of Directors composed of a minimum of three
members of the Board of Directors then serving who meet the independence
standards required of directors who serve on an audit committee of a board of
directors established by the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Commission thereunder and by the National
Securities Exchange on which the Common Units are listed or admitted to
trading.
“Available Cash”
means, with respect to any Quarter ending prior to the Liquidation
Date:
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(a)
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the
sum of (i) all cash and cash equivalents of the Partnership Group (or the
Partnership’s proportionate share of cash and cash equivalents in the case
of Subsidiaries that are not wholly owned) on hand at the end of such
Quarter, and (ii) all additional cash and cash equivalents of the
Partnership Group (or the Partnership’s proportionate share of cash and
cash equivalents in the case of Subsidiaries that are not wholly owned) on
hand on the date of determination of Available Cash with respect to such
Quarter resulting from Working Capital Borrowings made subsequent to the
end of such Quarter, less
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(b)
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the
amount of any cash reserves (or the Partnership’s proportionate share of
cash reserves in the case of Subsidiaries that are not wholly owned)
established by the Board of Directors to (i) provide for the proper
conduct of the business of the Partnership Group (including reserves for
future capital expenditures and for anticipated future credit needs of the
Partnership Group) subsequent to such Quarter, (ii) comply with applicable
law or any loan agreement, security agreement, mortgage, debt instrument
or other agreement or obligation to which any Group Member is a party or
by which it is bound or its assets are subject or (iii) provide funds for
distributions under Sections 6.2 or 6.3 in respect of any one or more of
the next four Quarters; provided, however, that
the Board of Directors may not establish cash reserves pursuant to (iii)
above if the effect of such reserves would be that the Partnership is
unable to distribute the Minimum Quarterly Distribution on all Common
Units, plus any Cumulative Common Unit Arrearage on all Common Units, with
respect to such Quarter; and, provided further, that
disbursements made by a Group Member or cash reserves established,
increased or reduced after the end of such Quarter but on or before the
date of determination of Available Cash with respect to such Quarter shall
be deemed to have been made, established, increased or reduced, for
purposes of determining Available Cash, within such Quarter if the Board
of Directors so determines.
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Notwithstanding
the foregoing, “Available Cash” with respect to the Quarter in which the
Liquidation Date occurs and any subsequent Quarter shall equal
zero.
“Board of Directors”
means the board of directors of the Partnership, composed of Appointed Directors
and Elected Directors appointed or elected, as the case may be, in accordance
with the provisions of Article VII and a majority of whom are not United States
citizens or residents, which, pursuant to Section 7.1, and subject to Section
7.11, oversees and directs the operations, management and policies of the
Partnership. The Board of Directors shall constitute a committee within the
meaning of Section 30(2)(g) of the Marshall Islands Act.
“Business Day” means
Monday through Friday of each week, except that a legal holiday recognized as
such by the government of the United States of America or the State of New York
shall not be regarded as a Business Day.
“Capital Contribution”
means any cash, cash equivalents or the Net Agreed Value of Contributed Property
that a Partner contributes to the Partnership.
“Capital Improvement”
means any (a) addition or improvement to the capital assets owned by any Group
Member or (b) acquisition of existing, or the construction of new, capital
assets, in each case if such addition, improvement, acquisition or construction
is made to increase the operating capacity or asset base of the Partnership
Group from the operating capacity or asset base of the Partnership Group
existing immediately prior to such addition, improvement, acquisition or
construction.
“Capital Surplus” has
the meaning assigned to such term in Section 6.1(a).
“Cause” means a court
of competent jurisdiction has entered a final, non-appealable judgment finding a
Person liable for actual fraud or willful misconduct in its capacity as a
general partner of the Partnership or as a member of the Board of Directors, as
the case may be.
“Certificate” means a
certificate (i) substantially in the form of Exhibit A to this Agreement,
(ii) issued in global or book entry form in accordance with the rules and
regulations of the Depositary or (iii) in such other form as may be adopted by
the Board of Directors, issued by the Partnership evidencing ownership of one or
more Common Units or a certificate, in such form as may be adopted by the Board
of Directors, issued by the Partnership evidencing ownership of one or more
other Partnership Securities.
“Certificate of Limited
Partnership” means the Certificate of Limited Partnership of the
Partnership filed with the Registrar of Corporations of The Marshall Islands as
referenced in Section 7.10 as such Certificate of Limited Partnership may be
amended, supplemented or restated from time to time.
“Change of Control”
means any of the following events: (a) any sale, lease, exchange or other
transfer (in one transaction or a series of related transactions) of all or
substantially all of the Partnership’s assets to any other Person, unless
immediately following such sale, lease, exchange or other transfer such assets
are owned, directly or indirectly, by the Partnership; (b) the consolidation or
merger of the Partnership with or into another Person pursuant to a transaction
in which the then-Outstanding Units are changed into or exchanged for cash,
securities or other property, other than any such transaction where (i) the
then-Outstanding Units Interests are changed into or exchanged for voting
securities of the surviving Person or its parent and (ii) the holders of the
Units immediately prior to such transaction own, directly or indirectly, not
less than a majority of the outstanding voting securities of the surviving
Person or its parent immediately after such transaction; and (c) a “person” or “group” (within the
meaning of Sections 13(d) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended) being or becoming the “beneficial owner” (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act) of more than 50% of all
of the then-Outstanding Units, except in a merger or consolidation that would
not constitute a Change of Control under clause (b) above.
“claim” (as used in
Section 7.20(c)) has the meaning assigned to such term in Section
7.20(c).
“Closing Date” means
the first date on which Common Units are sold by the Partnership to the
Underwriters pursuant to the provisions of the Purchase
Agreement.
“Closing Price” means,
in respect of any class of Limited Partner Interests, as of the date of
determination, the last sale price on such day, regular way, or in case no such
sale takes place on such day, the average of the closing bid and asked prices on
such day, regular way, as reported in the principal consolidated transaction
reporting system with respect to securities listed on the principal National
Securities Exchange on which the respective Limited Partner Interests are listed
or admitted to trading or, if such Limited Partner Interests are not listed or
admitted to trading on any National Securities Exchange, the last quoted price
on such day or, if not so quoted, the average of the high bid and low asked
prices on such day in the over-the-counter market, as reported by any quotation
system then in use with respect to such Limited Partner Interests, or, if on any
such day such Limited Partner Interests of such class are not quoted by any such
system, the average of the closing bid and asked prices on such day as furnished
by a professional market maker making a market in such Limited Partner Interests
of such class selected by the Board of Directors, or if on any such day no
market maker is making a market in such Limited Partner Interests of such class,
the fair value of such Limited Partner Interests on such day as determined by
the Board of Directors.
“Code” means the
United States Internal Revenue Code of 1986, as amended and in effect from time
to time. Any reference herein to a specific section or sections of the Code
shall be deemed to include a reference to any corresponding provision of any
successor law.
“Combined Interest”
has the meaning assigned to such term in Section 11.3(a).
“Commences Commercial
Service” and “Commenced Commercial
Service” shall mean the date a Capital Improvement is first put into
service by a Group Member following, if applicable, completion of construction
and testing.
“Commission” means the
United States Securities and Exchange Commission.
“Common Unit” means a
Partnership Security representing a fractional part of the Partnership Interests
of all Limited Partners, and having the rights and obligations specified with
respect to Common Units in this Agreement. The term “Common Unit” does not refer
to a Subordinated Unit or a Subordinated Series A Unit prior to its conversion
into a Common Unit pursuant to the terms hereof.
“Common Unit
Arrearage” means, with respect to any Common Unit, whenever issued, as to
any Quarter within the Subordination Period, the excess, if any, of (a) the
Minimum Quarterly Distribution with respect to a Common Unit in respect of such
Quarter over (b) the sum of all Available Cash distributed with respect to a
Common Unit in respect of such Quarter pursuant to Section
6.2(a)(i).
“Common Unit Purchase
Agreement” means the Common Unit Purchase Agreement dated November 12,
2007, between the Partnership and Amadeus Maritime providing for the purchase of
500,000 Common Units by Amadeus Maritime.
“Concurrent Offering”
means the offering and sale of Common Units sold pursuant to the Common Unit
Purchase Agreement.
“Conflicts Committee”
means a committee of the Board of Directors composed entirely of three or more
directors who are not (a) security holders, officers or employees of the General
Partner, (b) officers, directors or employees of any Affiliate of the
General Partner or (c) holders of any ownership interest in the Partnership
Group other than Common Units and who also meet the independence standards
required of directors who serve on an audit committee of a board of directors
established by the Securities Exchange Act of 1934, as amended, and the rules
and regulations of the Commission thereunder and by the National Securities
Exchange on which the Common Units are listed or admitted to
trading.
“Contributed Property”
means each property or other asset, in such form as may be permitted by the
Marshall Islands Act, but excluding cash, contributed to the
Partnership.
“Cumulative Common Unit
Arrearage” means, with respect to any Common Unit, whenever issued, and
as of the end of any Quarter, the excess, if any, of (a) the sum resulting from
adding together the Common Unit Arrearage as to an Initial Common Unit for each
of the Quarters within the Subordination Period ending on or before the last day
of such Quarter over (b) the sum of any distributions theretofore made pursuant
to Section 6.2(a)(ii) and the second sentence of Section 6.3 with respect to an
Initial Common Unit (including any distributions to be made in respect of the
last of such Quarters).
“Current Market Price”
means, in respect of any class of Limited Partner Interests, as of the date of
determination, the average of the daily Closing Prices per Limited Partner
Interest of such class for the 20 consecutive Trading Days immediately prior to
such date.
“Departing General
Partner” means a former General Partner from and after the effective date
of any withdrawal or removal of such former General Partner pursuant to Sections
11.1 or 11.2.
“Depositary” means,
with respect to any Units issued in global form, The Depository Trust Company
and its successors and permitted assigns.
“Elected Directors”
means the members of the Board of Directors who are elected or appointed as such
in accordance with the provisions of Article VII and at least three of whom are
not (a) security holders, officers or employees of the General Partner, (b)
officers, directors or employees of any Affiliate of the General Partner, (c)
holders of any ownership interest in the Partnership Group other than Common
Units and who also meet the independence standards required of directors who
serve on an audit committee of a board of directors established by the
Securities Exchange Act of 1934, as amended, and the rules and regulations of
the Commission thereunder and by the National Securities Exchange on which the
Common Units are listed or admitted to trading or (d) United States citizens or
residents.
“Estimated Maintenance
Capital Expenditures” means an estimate made in good faith by the Board
of Directors (with the concurrence of the Conflicts Committee) of the average
quarterly Maintenance Capital Expenditures that the Partnership will need to
incur to maintain the operating capacity or asset base of the Partnership Group
(including the Partnership’s proportionate share of the average quarterly
Maintenance Capital Expenditures of its Subsidiaries that are not wholly owned)
existing at the time the estimate is made. The Board of Directors (with the
concurrence of the Conflicts Committee) will be permitted to make such estimate
in any manner it determines reasonable. The estimate will be made at least
annually and whenever an event occurs that is likely to result in a material
adjustment to the amount of Maintenance Capital Expenditures on a long-term
basis. The Partnership shall disclose to its Partners any change in the amount
of Estimated Maintenance Capital Expenditures in its reports made in accordance
with Section 8.3 to the extent not previously disclosed. Except as provided in
the definition of Subordination Period, any adjustments to Estimated Maintenance
Capital Expenditures shall be prospective only.
“Event of Withdrawal”
has the meaning assigned to such term in Section 11.1(a).
“Expansion Capital
Expenditures” means cash expenditures for Acquisitions or Capital
Improvements. Expansion Capital Expenditures shall not include Maintenance
Capital Expenditures. Expansion Capital Expenditures shall include interest (and
related fees) on debt incurred and distributions on equity incurred, in each
case, to finance the construction of a Capital Improvement and paid during the
period beginning on the date that the Partnership enters into a binding
obligation to commence construction of the Capital Improvement and ending on the
earlier to occur of the date that such Capital Improvement Commences Commercial
Service or the date that such Capital Improvement is abandoned or disposed of.
Debt incurred or equity issued to fund any such construction period interest
payments, or such construction period distributions on equity paid during such
period shall also be deemed to be debt or equity, as the case may be, incurred
to finance the construction of a Capital Improvement.
“First Contribution
Agreement” means that certain Contribution and Conveyance Agreement,
dated as of November 12, 2007, among the General Partner, the Partnership, the
Operating Company and Navios Maritime Holdings, together with the additional
conveyance documents and instruments contemplated or referenced
thereunder.
“First Target
Distribution” means $0.4025 per Unit per Quarter (or, with respect to the
period commencing on the Closing Date and ending on December 31, 2007,
it means the product of $0.4025 multiplied by a fraction of which the numerator
is the number of days in such period, and of which the denominator is the total
number of days in the Quarter in which the Closing Date occurs), subject to
adjustment in accordance with Section 6.4.
“Fully Diluted Basis”
means, when calculating the number of Outstanding Units for any period, a basis
that includes, in addition to the Outstanding Units, all Partnership Securities
and options, rights, warrants and appreciation rights relating to an equity
interest in the Partnership (a) that are convertible into or exercisable or
exchangeable for Units that are senior to or pari passu with the
Subordinated Units, (b) whose conversion, exercise or exchange price is less
than the Current Market Price on the date of such calculation, (c) that may be
converted into or exercised or exchanged for such Units prior to or during the
Quarter immediately following the end of the period for which the calculation is
being made without the satisfaction of any contingency beyond the control of the
holder other than the payment of consideration and the compliance with
administrative mechanics applicable to such conversion, exercise or exchange and
(d) that were not converted into or exercised or exchanged for such Units during
the period for which the calculation is being made; provided, however, that for
purposes of determining the number of Outstanding Units on a Fully Diluted Basis
when calculating whether the Subordination Period has ended or Subordinated
Units are entitled to convert into Common Units pursuant to Section 5.7, such
Partnership Securities, options, rights, warrants and appreciation rights shall
be deemed to have been Outstanding Units only for the four Quarters that
comprise the last four Quarters of the measurement period; and, provided further, that if
consideration will be paid to any Group Member in connection with such
conversion, exercise or exchange, the number of Units to be included in such
calculation shall be that number equal to the difference between (i) the number
of Units issuable upon such conversion, exercise or exchange and (ii) the number
of Units that such consideration would purchase at the Current Market
Price.
“General Partner”
means Navios GP, L.L.C., a Marshall Islands limited liability company, and its
successors and permitted assigns that are admitted to the Partnership as general
partner of the Partnership, in its capacity as general partner of the
Partnership (except as the context otherwise requires).
“General Partner
Interest” means the ownership interest of the General Partner in the
Partnership (in its capacity as a general partner and without reference to any
Limited Partner Interest held by it), which is evidenced by General Partner
Units and includes any and all benefits to which the General Partner is entitled
as provided in this Agreement, together with all obligations of the General
Partner to comply with the terms and provisions of this
Agreement.
“General Partner Unit”
means a fractional part of the General Partner Interest having the rights and
obligations specified with respect to the General Partner Interest. A General
Partner Unit is not a Unit.
“Group” means a Person
that, including with or through any of its Affiliates or Associates, has any
agreement, arrangement, understanding or relationship for the purpose of
acquiring, holding, voting (except voting pursuant to a revocable proxy or
consent given to such Person in response to a proxy or consent solicitation made
to 10 or more Persons) or disposing of any Partnership Securities with any other
Person that beneficially owns, or whose Affiliates or Associates beneficially
own, directly or indirectly, Partnership Securities.
“Group Member” means a
member of the Partnership Group.
“Group Member
Agreement” means the partnership agreement of any Group Member, other
than the Partnership, that is a limited or general partnership, the limited
liability company agreement of any Group Member that is a limited liability
company, the certificate of incorporation and bylaws (or similar organizational
documents) of any Group Member that is a corporation, the joint venture
agreement or similar governing document of any Group Member that is a joint
venture and the governing or organizational or similar documents of any other
Group Member that is a Person other than a limited or general partnership,
limited liability company, corporation or joint venture, in each case as such
may be amended, supplemented or restated from time to time.
“Holder” as used in
Section 7.20, has the meaning assigned to such term in Section
7.20(a).
“Incentive Distribution
Right” means a non-voting Limited Partner Interest, which Partnership
Interest will confer upon the holder thereof only the rights and obligations
specifically provided in this Agreement with respect to Incentive Distribution
Rights (and no other rights otherwise available to or other obligations of a
holder of a Partnership Interest). Notwithstanding anything in this Agreement to
the contrary, the holder of an Incentive Distribution Right shall not be
entitled to vote such Incentive Distribution Right on any Partnership matter
except as may otherwise be required by law.
“Incentive
Distributions” means any amount of cash distributed to the holders of the
Incentive Distribution Rights pursuant to Sections 6.2(a)(v), 6.2(a)(vi) and
6.2(a)(vii) and 6.2(b)(iii), 6.2(b)(iv) and 6.2(b)(v).
“Indemnified Persons”
has the meaning assigned to such term in Section 7.20(c).
“Indemnitee” means (a)
the General Partner, (b) any Departing General Partner, (c) any Person who is or
was an Affiliate of the General Partner or any Departing General Partner, (d)
any Person who is or was a member, partner, director, officer, fiduciary or
trustee of any Person which any of the preceding clauses of this definition
describes, (e) any Person who is or was serving at the request of the General
Partner or any Departing General Partner or any Affiliate of the General Partner
or any Departing General Partner as an officer, director, member, partner,
fiduciary or trustee of another Person (provided, however, that a
Person shall not be an Indemnitee by reason of providing, on a fee-for-services
basis, trustee, fiduciary or custodial services), (f) the members of the Board
of Directors, (g) the Officers, and (h) any other Person the Board of Directors
designates as an “Indemnitee” for purposes of this Agreement.
“Initial Common Units”
means the Common Units sold in the Initial Offering and the Concurrent
Offering.
“Initial General Partner
Interest” has the meaning set forth in Section 5.1.
“Initial Limited Partner
Interest” has the meaning set forth in Section 5.1.
“Initial Limited
Partners” means Amadeus Maritime, Navios Maritime Holdings and the
General Partner (with respect to the Incentive Distribution Rights received by
it pursuant to Section 5.2(a)) and the Underwriters, in each case upon being
admitted to the Partnership in accordance with Section 10.1.
“Initial Offering”
means the initial offering and sale of Common Units to the public, as described
in the Registration Statement.
“Initial Unit Price”
means (a) with respect to the Common Units and the Subordinated Units, the
initial public offering price per Common Unit at which the Underwriters offered
the Common Units to the public for sale as set forth on the cover page of the
prospectus included as part of the Registration Statement and first issued at or
after the time the Registration Statement first became effective, (b) with
respect to the Subordinated Series A Units $6.08 per unit, or (c) with
respect to any other class or series of Units, the price per Unit at which such
class or series of Units is initially sold by the Partnership, as determined by
the Board of Directors, in each case adjusted as the Board of Directors
determines to be appropriate to give effect to any distribution, subdivision or
combination of Units.
“Interim Capital
Transactions” means the following transactions if they occur prior to the
Liquidation Date: (a) borrowings, refinancings or refundings of indebtedness
(other than Working Capital Borrowings and other than for items purchased on
open account in the ordinary course of business) by any Group Member and sales
of debt securities of any Group Member; (b) sales of equity interests of any
Group Member (including the Common Units sold to the Underwriters pursuant to
the exercise of the Over-Allotment Option); (c) sales or other voluntary or
involuntary dispositions of any assets of any Group Member other than (i) sales
or other dispositions of inventory, accounts receivable and other assets in the
ordinary course of business and (ii) sales or other dispositions of assets as
part of normal retirements or replacements; (d) the termination of interest rate
swap agreements; (e) capital contributions received; and (f) corporate
reorganizations or restructurings.
“Investment Capital
Expenditures” means capital expenditures other than Maintenance Capital
Expenditures or Expansion Capital Expenditures.
“Issue Price” means
the price at which a Unit is purchased from the Partnership, after deducting any
sales commission or underwriting discount charged to the Partnership. In the
case of the Subordinated Series A Units, the Issue Price shall be deemed to be
$6.08 per unit.
“Limited Partner”
means, unless the context otherwise requires, the Organizational Limited Partner
prior to its withdrawal from the Partnership, each Initial Limited Partner, each
additional Person that becomes a Limited Partner pursuant to the terms of this
Agreement and any Departing General Partner upon the change of its status from
General Partner to Limited Partner pursuant to Section 11.3, in each case, in
such Person’s capacity as a limited partner of the Partnership; provided, however, that when
the term “Limited Partner” is used herein in the context of any vote or other
approval, including Articles XIII and XIV, such term shall not, solely for such
purpose, include any holder of an Incentive Distribution Right or Subordinated
Series A Unit (solely with respect to such Incentive Distribution Rights or
Subordinated Series A Units and not with respect to any other Limited Partner
Interest held by such Person) except as may otherwise be required by law.
Limited Partners may include custodians, nominees or any other individual or
entity in its own or any representative capacity.
“Limited Partner
Interest” means the ownership interest of a Limited Partner in the
Partnership, which may be evidenced by Common Units, Subordinated Units,
Subordinated Series A Units, Incentive Distribution Rights or other Partnership
Securities or a combination thereof or interest therein, and includes any and
all benefits to which such Limited Partner is entitled as provided in this
Agreement, together with all obligations of such Limited Partner to comply with
the terms and provisions of this Agreement; provided, however, that when
the term “Limited Partner Interest” is used herein in the context of any vote or
other approval, including Articles XIII and XIV, such term shall not, solely for
such purpose, include any Incentive Distribution Right or Subordinated Series A
Unit except as may otherwise be required by law.
“Liquidation Date”
means (a) in the case of an event giving rise to the dissolution of the
Partnership of the type described in clauses (a) and (b) of the first sentence
of Section 12.2, the date on which the applicable time period during which the
holders of Outstanding Units have the right to elect to continue the business of
the Partnership has expired without such an election being made, and (b) in the
case of any other event giving rise to the dissolution of the Partnership, the
date on which such event occurs.
“Liquidator” means one
or more Persons selected by the Board of Directors to perform the functions
described in Section 12.4.
“Maintenance Capital
Expenditures” means cash expenditures (including expenditures for the
addition or improvement to the capital assets owned by any Group Member or for
the acquisition of existing, or the construction of new, capital assets) if such
expenditure is made to maintain the operating capacity or asset base of the
Partnership Group. Maintenance Capital Expenditures shall not include (a)
Expansion Capital Expenditures or (b) expenditures made solely for investment
purposes (as opposed to maintenance purposes). Maintenance Capital Expenditures
shall include interest (and related fees) on debt incurred and distributions on
equity issued, in each case, to finance the construction of a replacement asset
and paid during the period beginning on the date that the Group Member enters
into a binding obligation to commence constructing a replacement asset and
ending on the earlier to occur of the date that such replacement asset Commences
Commercial Service or the date that such replacement asset is abandoned or
disposed of. Debt incurred to pay or equity issued to fund the construction
period interest payments, or such construction period distributions on equity
shall also be deemed to be debt or equity, as the case may be, incurred to
finance the construction of a replacement asset.
“Marshall Islands Act”
means the Limited Partnership Act of The Republic of the Marshall Islands, as
amended, supplemented or restated from time to time, and any successor to such
statute.
“Merger Agreement” has
the meaning assigned to such term in Section 14.1.
“Minimum Quarterly
Distribution” means $0.35 per Unit per Quarter (or with respect to the
period commencing on the Closing Date and ending on December 31, 2007,
it means the product of $0.35 multiplied by a fraction of which the numerator is
the number of days in such period and of which the denominator is the total
number of days in the Quarter in which the Closing Date occurs), subject to
adjustment in accordance with Section 6.4.
“Navios Maritime
Holdings” means Navios Maritime Holdings Inc., a Marshall Islands
corporation.
“National Securities
Exchange” means an exchange registered with the Commission under Section
6(a) of the Securities Exchange Act of 1934, as amended, supplemented or
restated from time to time, and any successor to such
statute.
“Net Agreed Value”
means, (a) in the case of any Contributed Property, the Agreed Value of such
property reduced by any indebtedness either assumed by the Partnership upon such
contribution or to which such property is subject when contributed, and (b) in
the case of any property distributed to a Partner by the Partnership, the Agreed
Value of such property, reduced by any indebtedness either assumed by such
Partner upon such distribution or to which such property is subject at the time
of distribution.
“Notice of Election to
Purchase”‘ has the meaning assigned to such term in Section
15.1(b).
“Officers” means the
Chairman of the Board of Directors (unless the Board of Directors provides
otherwise), the Executive Vice Chairman or Vice Chairman of the Board of
Directors (unless the Board of Directors provides otherwise), the Chief
Executive Officer, the President, any Vice Presidents, the Secretary, the
Treasurer, any Assistant Secretaries or Assistant Treasurers, and any other
officer of the Partnership appointed by the Board of Directors pursuant to
Section 7.8.
“Omnibus Agreement”
means that Omnibus Agreement among Navios Maritime Holdings, the Partnership,
the General Partner and the Operating Company, as it may be amended,
supplemented or restated from time to time.
“Operating Company”
means Navios Maritime Operating L.L.C., a Marshall Islands limited liability
company, and any successors thereto.
“Operating Company
Agreement” means the First Amended and Restated Limited Liability Company
Agreement of the Operating Company, as it may be amended, supplemented or
restated from time to time.
“Operating
Expenditures” means all Partnership Group expenditures (or the
Partnership’s proportionate share of expenditures in the case of Subsidiaries
that are not wholly owned), including taxes, reimbursements of the General
Partner, repayment of Working Capital Borrowings, debt service payments and
capital expenditures, subject to the following:
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(a)
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repayment
of Working Capital Borrowings deducted from Operating Surplus pursuant to
clause (b)(iii) of the definition of Operating Surplus shall not
constitute Operating Expenditures when actually
repaid;
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(b)
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payments
(including prepayments and prepayment penalties) of principal of and
premium on indebtedness other than Working Capital Borrowings shall not
constitute Operating Expenditures;
and
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(c)
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Operating
Expenditures shall not include (i) Expansion Capital Expenditures,
Investment Capital Expenditures or actual Maintenance Capital
Expenditures, but shall include Estimated Maintenance Capital
Expenditures, (ii) payment of transaction expenses (including taxes)
relating to Interim Capital Transactions or (iii) distributions to
Partners,
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where
capital expenditures consist of both (x) Maintenance Capital Expenditures
and (y) Expansion Capital Expenditures and/or Investment Capital
Expenditures, the General Partner, with the concurrence of the Conflicts
Committee, shall determine the allocation between the amounts paid for
each.
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“Operating Surplus”
means, with respect to any period ending prior to the Liquidation Date, on a
cumulative basis and without duplication:
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(a)
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the
sum of (i) $20 million, (ii) all cash receipts of the Partnership
Group (or the Partnership’s proportionate share of cash receipts in the
case of Subsidiaries that are not wholly owned) for the period beginning
on the Closing Date and ending on the last day of such period, other than
cash receipts from Interim Capital Transactions, (iii) all cash receipts
of the Partnership Group (or the Partnership’s proportionate share of cash
receipts in the case of Subsidiaries that are not wholly owned) after the
end of such period but on or before the date of determination of Operating
Surplus with respect to such period resulting from Working Capital
Borrowings and (iv) the amount of distributions paid on equity issued in
connection with the construction of a Capital Improvement or replacement
asset and paid during the period beginning on the date that the Group
Member enters into a binding obligation to commence construction of such
Capital Improvement or replacement asset and ending on the earlier to
occur of the date that such Capital Improvement or replacement asset
Commences Commercial Service or the date that it is abandoned or disposed
of (equity issued to fund the construction period interest payments on
debt incurred (including periodic net payments under related interest rate
swap agreements), or construction period distributions on equity issued,
to finance the construction of a Capital Improvement or replacement asset
shall also be deemed to be equity issued to finance the construction of a
Capital Improvement or replacement asset for purposes of this clause
(iv)), less
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(b)
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the
sum of (i) Operating Expenditures for the period beginning on the Closing
Date and ending on the last day of such period, (ii) the amount of cash
reserves (or the Partnership’s proportionate share of cash reserves in the
case of Subsidiaries that are not wholly owned) established by the Board
of Directors to provide funds for future Operating Expenditures and (iii)
all Working Capital Borrowings not repaid within twelve months after
having been incurred; provided, however, that
disbursements made (including contributions to a Group Member or
disbursements on behalf of a Group Member) or cash reserves established,
increased or reduced after the end of such period but on or before the
date of determination of Available Cash with respect to such period shall
be deemed to have been made, established, increased or reduced, for
purposes of determining Operating Surplus, within such period if the Board
of Directors so determines.
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Notwithstanding
the foregoing, “Operating Surplus”
with respect to the Quarter in which the Liquidation Date occurs and any
subsequent Quarter shall equal zero.
“Opinion of Counsel”
means a written opinion of counsel (who may be regular counsel to the
Partnership or the General Partner or any of its Affiliates) acceptable to the
Board of Directors.
“Option Closing Date”
means the date or dates on which any Common Units are sold by the Partnership to
the Underwriters upon exercise of the Over-Allotment Option.
“Organizational Limited
Partner” means Navios Maritime Holdings in its capacity as the
organizational limited partner of the Partnership pursuant to this
Agreement.
“Outstanding” means,
with respect to Partnership Securities, all Partnership Securities that are
issued by the Partnership and reflected as outstanding on the Partnership’s
books and records as of the date of determination; provided, however, that if at
any time any Person or Group beneficially owns more than 4.9% of the Outstanding
Partnership Securities of any class then Outstanding (or would own such
percentage after application of this limitation), all Partnership Securities
owned by such Person or Group in excess of 4.9% of the Outstanding Partnership
Securities shall not be voted on any matter and shall not be considered to be
Outstanding when sending notices of a meeting of Limited Partners to vote on any
matter (unless otherwise required by law), calculating required votes, except
for purposes of nominating a Person for election to the Board of Directors
pursuant to Section 7.3, or determining the presence of a quorum or for other
similar purposes under this Agreement, except that Partnership Securities so
owned shall be considered to be Outstanding for purposes of Section 11.1(b)(iv)
(such Partnership Securities shall not, however, be treated as a separate class
of Partnership Securities for purposes of this Agreement); provided, further, that the
foregoing limitation shall not apply to either of the following (other than when
voting their Common Units as provided in Section 7.2(a)(ii)): (i) the General
Partner or its Affiliates or (ii) any Person or Group who acquired more
than 4.9% of any Partnership Securities issued by the Partnership with the prior
approval of the Board of Directors after considering the potential tax effects
of such approval on the Partnership.
“Over-Allotment
Option” means the over-allotment option granted to the Underwriters
pursuant to the Purchase Agreement.
“Partners” means the
General Partner and the Limited Partners.
“Partnership” means
Navios Maritime Partners L.P., a Marshall Islands limited partnership, and any
successors thereto.
“Partnership Group”
means the Partnership and its Subsidiaries, including the Operating Company,
treated as a single entity.
“Partnership Interest”
means an interest in the Partnership, which shall include the General Partner
Interest and Limited Partner Interests.
“Partnership Security”
means any class or series of equity interest in the Partnership (but excluding
any options, rights, warrants and appreciation rights relating to an equity
interest in the Partnership), including Common Units, Subordinated Units,
Subordinated Series A Units and Incentive Distribution
Rights.
“Percentage Interest”
means as of any date of determination (a) as to the General Partner with respect
to General Partner Units and as to any Unitholder with respect to Units, the
product obtained by multiplying (i) 100% less the percentage applicable to
clause (b) below by (ii) the quotient obtained by dividing (A) the number of
Units held by such Unitholder or the number of General Partner Units held by the
General Partner, as the case may be, by (B) the total number of all Outstanding
Units and General Partner Units, and (b) as to the holders of other Partnership
Securities issued by the Partnership in accordance with Section 5.5, the
percentage established as a part of such issuance. The Percentage Interest with
respect to an Incentive Distribution Right shall at all times be
zero.
“Person” means an
individual or a corporation, firm, limited liability company, partnership, joint
venture, trust, unincorporated organization, association, governmental agency or
political subdivision thereof or other entity.
“Prior Agreement”
means the First Amended and Restated Agreement of Limited Partnership of Navios
Maritime Partners L.P., dated November 16, 2007.`
“Pro Rata” means (a)
when used with respect to Units or any class thereof, apportioned equally among
all designated Units in accordance with their relative Percentage Interests, (b)
when used with respect to Partners or Record Holders, apportioned among all
Partners or Record Holders in accordance with their relative Percentage
Interests and (c) when used with respect to holders of Incentive Distribution
Rights, apportioned equally among all holders of Incentive Distribution Rights
in accordance with the relative number or percentage of Incentive Distribution
Rights held by each such holder.
“Purchase Agreement”
means the Purchase Agreement dated November 12, 2007 among the Underwriters, the
Partnership, the General Partner, the Operating Company, and Navios Maritime
Holdings, providing for the purchase of Common Units by such
Underwriters.
“Purchase Date” means
the date determined by the General Partner as the date for purchase of all
Outstanding Limited Partner Interests of a certain class (other than Limited
Partner Interests owned by the General Partner and its Affiliates) pursuant to
Article XV.
“Quarter” means,
unless the context requires otherwise, a fiscal quarter, or, with respect to the
first fiscal quarter including the Closing Date, the portion of such fiscal
quarter after the Closing Date, of the Partnership.
“Record Date” means
the date established by the Board of Directors or otherwise in accordance with
this Agreement for determining (a) the identity of the Record Holders entitled
to notice of, or to vote at, any meeting of Limited Partners or entitled to vote
by ballot or give approval of Partnership action in writing without a meeting or
entitled to exercise rights in respect of any lawful action of Limited Partners
or (b) the identity of Record Holders entitled to receive any report or
distribution or to participate in any offer.
“Record Holder” means
(a) the Person in whose name a Common Unit is registered on the books of the
Transfer Agent as of the opening of business on a particular Business Day, or
(b) with respect to other Partnership Interests, the Person in whose name any
such other Partnership Interest is registered on the books that the Board of
Directors has caused to be kept as of the opening of business on such Business
Day.
“Registration
Statement” means the Registration Statement on Form F-1 (Registration
No. 333-146972) as it has been or as it may be amended or supplemented from
time to time, filed by the Partnership with the Commission under the Securities
Act to register the offering and sale of the Common Units in the Initial
Offering.
“Second Contribution
Agreement” means that certain Contribution, Sale and Conveyance
Agreement, dated as of the Closing Date, among the General Partner, the
Partnership, the Operating Company and Navios Maritime Holdings, together with
the additional conveyance documents and instruments contemplated or referenced
therein.
“Second Target
Distribution” means $0.4375 per Unit per Quarter (or, with respect to the
period commencing on the Closing Date and ending on December 31, 2007,
it means the product of $0.4375 multiplied by a fraction of which the numerator
is equal to the number of days in such period and of which the denominator is
the total number of days in the Quarter in which the Closing Date occurs),
subject to adjustment in accordance with Section 6.4.
“Securities Act” means
the Securities Act of 1933, as amended, supplemented or restated from time to
time and any successor to such statute.
“Special Approval”
means approval by a majority of the members of the Conflicts
Committee.
“Subordinated Unit”
means a Unit representing a fractional part of the Partnership Interests of all
Limited Partners and having the rights and obligations specified with respect to
Subordinated Units in this Agreement. The term “Subordinated Unit” does not
include a Common Unit or a Subordinated Series A Unit. A Subordinated Unit that
is convertible into a Common Unit shall not constitute a Common Unit until such
conversion occurs.
“Subordinated Series A
Unit” means a Unit representing a fractional part of the Partnership
Interests of all Limited Partners and having the rights and obligations
specified with respect to Subordinated Series A Units in this Agreement. The
term “Subordinated Series A Unit” as used herein does not include a Common Unit
or a Subordinated Unit. A Subordinated Series A Unit shall not constitute a
Common Unit until it converts into a Common Unit. The Subordinated Series A
Units shall not have any voting rights, except as otherwise may be required by
law.
“Subordination Period”
means the period commencing on the Closing Date and ending on the first to occur
of the following dates:
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(a)
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the
first day of any Quarter beginning after December 31, 2011, in
respect of which (i)(A) distributions of Available Cash from
Operating Surplus on each of the Outstanding Common Units, Subordinated
Units, General Partner Units and any other Outstanding Units that are
senior or equal in right of distribution to the Subordinated Units (other
than Subordinated Series A Units) equaled or exceeded the Minimum
Quarterly Distribution during each of the three consecutive,
non-overlapping four-Quarter periods immediately preceding such date and
(B) the Adjusted Operating Surplus for each of the three consecutive,
non-overlapping four-Quarter periods immediately preceding such date
equaled or exceeded the sum of the Minimum Quarterly Distribution on all
of the Common Units, Subordinated Units, General Partner Units and any
other Units that are senior or equal in right of distribution to the
Subordinated Units (other than Subordinated Series A Units) that were
Outstanding during such periods on a Fully Diluted Basis with respect to
each such period and (ii) there are no Cumulative Common Unit Arrearages;
and
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(b)
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the
date on which the General Partner is removed as general partner of the
Partnership upon the requisite vote by holders of Outstanding Units under
circumstances where Cause does not exist and no Units held by the General
Partner and its Affiliates are voted in favor of such
removal.
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For
purposes of determining whether the test in subclause (a)(i)(B) above has been
satisfied, Adjusted Operating Surplus will be adjusted upwards or downwards if
the Conflicts Committee determines in good faith that the amount of Estimated
Maintenance Capital Expenditures used in the determination of Adjusted Operating
Surplus in subclause (a)(i)(B) was materially incorrect, based on circumstances
prevailing at the time of original determination of Estimated Maintenance
Capital Expenditures, for any one or more of the preceding three four-Quarter
periods.
“Subsidiary” means,
with respect to any Person, (a) a corporation of which more than 50% of the
voting power of shares entitled (without regard to the occurrence of any
contingency) to vote in the election of directors or other governing body of
such corporation is owned, directly or indirectly, at the date of determination,
by such Person, by one or more Subsidiaries (as defined, but excluding
subsection (d) of this definition) of such Person or a combination thereof, (b)
a partnership (whether general or limited) in which such Person or a Subsidiary
(as defined, but excluding subsection (d) of this definition) of such Person is,
at the date of determination, a general or limited partner of such partnership,
but only if more than 50% of the partnership interests of such partnership
(considering all of the partnership interests of the partnership as a single
class) is owned, directly or indirectly, at the date of determination, by such
Person, by one or more Subsidiaries (as defined, but excluding subsection (d) of
this definition) of such Person, or a combination thereof, (c) any other Person
(other than a corporation or a partnership) in which such Person, one or more
Subsidiaries (as defined, but excluding subsection (d) of this definition) of
such Person, or a combination thereof, directly or indirectly, at the date of
determination, has (i) at least a majority ownership interest or (ii) the power
to elect or direct the election of a majority of the directors or other
governing body of such Person, or (d) any other Person in which such Person, one
or more Subsidiaries (as defined, but excluding subsection (d) of this
definition) of such Person, or a combination thereof, directly or indirectly, at
the date of determination, has (i) less than a majority ownership interest or
(ii) less than the power to elect or direct the election of a majority of the
directors or other governing body of such Person, provided that (A) such Person,
one or more Subsidiaries (as defined, but excluding this subsection (d) of
this definition) of such Person, or a combination thereof, directly or
indirectly, at the date of the determination, has at least a 20% ownership
interest in such other Person, (B) such Person accounts for such other Person
(under U.S. GAAP, as in effect on the later of the date of investment in such
other Person or material expansion of the operations of such other Person) on a
consolidated or equity accounting basis, (C) such Person has directly or
indirectly material negative control rights regarding such other Person
including over such other Person’s ability to materially expand its operations
beyond that contemplated at the date of investment in such other Person, and (D)
such other Person is (i) other than with respect to the Operating Company,
formed and maintained for the sole purpose of owning or leasing, operating and
chartering no more than 10 vessels for a period of no more than 40 years, and
(ii) obligated under its constituent documents, or as a result of a unanimous
agreement of its owners, to distribute to its owners all of its income on at
least an annual basis (less any cash reserves that are approved by such
Person).
“Surviving Business
Entity” has the meaning assigned to such term in Section
14.2(b).
“Third Target
Distribution” means $0.525 per unit per Quarter (or, with respect to the
period commencing on the Closing Date and ending on December 31, 2007,
it means the product of $0.525 multiplied by a fraction of which the numerator
is equal to the number of days in such period and of which the denominator is
the total number of days in the Quarter in which the Closing Date occurs),
subject to adjustment in accordance with Section 6.4.
“Trading Day” means,
for the purpose of determining the Current Market Price of any class of Limited
Partner Interests, a day on which the principal National Securities Exchange on
which such class of Limited Partner Interests is listed is open for the
transaction of business or, if Limited Partner Interests of a class are not
listed on any National Securities Exchange, a day on which banking institutions
in New York City generally are open.
“transfer” has the
meaning assigned to such term in Section 4.4(a).
“Transfer Agent” means
such bank, trust company or other Person (including the General Partner or one
of its Affiliates) as shall be appointed from time to time by the Partnership to
act as registrar and transfer agent for the Common Units; provided, however, that if no
Transfer Agent is specifically designated for any other Partnership Securities,
the Board of Directors shall act in such capacity.
“Underwriter” means
each Person named as an underwriter in Schedule I to the Purchase Agreement who
purchases Common Units pursuant thereto.
“Unit” means a
Partnership Security that is designated as a “Unit” and shall include Common
Units, Subordinated Units and Subordinated Series A Units, but shall not include
(i) General Partner Units (or the General Partner Interest represented thereby)
or (ii) the Incentive Distribution Rights.
“Unitholders” means
the holders of Units.
“Unit Majority” means,
during the Subordination Period, at least a majority of the Outstanding Common
Units (excluding Common Units owned by the General Partner and its Affiliates)
voting as a class and at least a majority of the Outstanding Subordinated Units
(excluding the Subordinated Series A Units) voting as a class, and after the end
of the Subordination Period, at least a majority of the Outstanding Common
Units.
“Unit Register” means
the register of the Partnership for the registration and transfer of Limited
Partnership Interests as provided in Section 4.5.
“Unrecovered Capital”
means at any time, with respect to a Unit, the Initial Unit Price less the sum
of all distributions constituting Capital Surplus theretofore made in respect of
an Initial Common Unit and any distributions of cash (or the Net Agreed Value of
any distributions in kind) in connection with the dissolution and liquidation of
the Partnership theretofore made in respect of an Initial Common Unit, adjusted
as the Board of Directors determines to be appropriate to give effect to any
distribution, subdivision or combination of such Units.
“U.S. GAAP” means
United States generally accepted accounting principles consistently
applied.
“Withdrawal Opinion of
Counsel” has the meaning assigned to such term in Section
11.1(b).
“Working Capital
Borrowings” means borrowings used solely for working capital purposes or
to pay distributions to Partners made pursuant to a credit facility, commercial
paper facility or similar financing arrangement available to a Group Member,
provided that when such borrowing is incurred it is the intent of the borrower
to repay such borrowing within 12 months from other than additional Working
Capital Borrowings.
Section
1.2 Construction. Unless
the context requires otherwise: (a) any pronoun used in this Agreement shall
include the corresponding masculine, feminine or neuter forms, and the singular
form of nouns, pronouns and verbs shall include the plural and vice versa; (b)
references to Articles and Sections refer to Articles and Sections of this
Agreement; (c) the term “include” or “includes” means includes, without
limitation, and “including” means including, without limitation; and (d) the
terms “hereof”, “herein” and “hereunder” refer to this Agreement as a whole and
not to any particular provision of this Agreement. The table of contents and
headings contained in this Agreement are for reference purposes only, and shall
not affect in any way the meaning or interpretation of this
Agreement.
Section
2.1 Formation. The
General Partner and the Organizational Limited Partner have previously formed
the Partnership as a limited partnership pursuant to the provisions of the
Marshall Islands Act. The General Partner and the Limited Partners have
previously entered into the Prior Agreement, and hereby amend and restate
the Prior Agreement
in its entirety. The purpose of this Second Amended and Restated Agreement of
Limited Partnership is (i) to establish the rights and obligations of the
Subordinated Series A Units in connection with the issuance of such Partnership
Securities pursuant to Section 5.5(a) of this Agreement, and (ii) to make other
miscellaneous revisions. This amendment and restatement shall become effective
on the date of this Agreement. Except as expressly provided to the contrary in
this Agreement, the rights, duties (including fiduciary duties), liabilities and
obligations of the Partners and the administration, dissolution and termination
of the Partnership shall be governed by the Marshall Islands Act. All
Partnership Interests shall constitute personal property of the owner thereof
for all purposes and a Partner has no interest in specific Partnership
property.
Section
2.2 Name. The
name of the Partnership shall be “Navios Maritime Partners L.P.” The
Partnership’s business may be conducted under any other name or names as
determined by the Board of Directors. The words “Limited Partnership” or the
letters “L.P.” or similar words or letters shall be included in the
Partnership’s name where necessary for the purpose of complying with the laws of
any jurisdiction that so requires. The Board of Directors may change the name of
the Partnership at any time and from time in compliance with the requirements of
the Marshall Islands Act to time and shall notify the General Partner and the
Limited Partners of such change in the next regular communication to the Limited
Partners.
Section
2.3 Registered Office;
Registered Agent; Principal Office; Other
Offices. Unless and until changed by the Board of
Directors, the registered office of the Partnership in The Marshall Islands
shall be located at Trust Company Complex, Ajeltake Island, Ajeltake Road,
Majuro, Marshall Islands MH 96960, and the registered agent for service of
process on the Partnership in The Marshall Islands at such registered office
shall be The Trust Company of The Marshall Islands, Inc. The principal office of
the Partnership shall be located at 85 Akti Miaouli Street, Piraeus, Greece 185
38, or such other place as the Board of Directors may from time to time
designate by notice to the General Partner and the Limited Partners. The
Partnership may maintain offices at such other place or places within or outside
The Marshall Islands as the Board of Directors determines to be necessary or
appropriate. The address of the General Partner shall be at 85 Akti Miaouli
Street, Piraeus, Greece 185 38, or such other place as the General Partner may
from time to time designate by notice to the Limited
Partners.
Section
2.4 Purpose and
Business. The purpose and nature of the business
to be conducted by the Partnership shall be to (a) engage directly in, or enter
into or form any corporation, partnership, joint venture, limited liability
company or other arrangement to engage indirectly in, any business activity that
lawfully may be conducted by a limited partnership organized pursuant to the
Marshall Islands Act and, in connection therewith, to exercise all of the rights
and powers conferred upon the Partnership pursuant to the agreements relating to
such business activity, and (b) do anything necessary or appropriate to the
foregoing, including the making of capital contributions or loans to a Group
Member.
Section
2.5 Powers. The
Partnership shall be empowered to do any and all acts and things necessary and
appropriate for the furtherance and accomplishment of the purposes and business
described in Section 2.4 and for the protection and benefit of the
Partnership.
Section
2.6 Power of
Attorney.
(a) Each
Limited Partner hereby constitutes and appoints the Chairman of the Board of
Directors, Vice Chairman of the Board of Directors, the Chief Executive Officer
and President of the Partnership and, if a Liquidator shall have been selected
pursuant to Section 12.3, the Liquidator, severally (and any successor to the
Liquidator by merger, transfer, assignment, election or otherwise) and each of
its authorized officers and attorneys-in-fact, as the case may be, with full
power of substitution, as his true and lawful agent and attorney-in-fact, with
full power and authority in his name, place and stead, to:
(i) execute,
swear to, acknowledge, deliver, file and record in the appropriate public
offices (A) all certificates, documents and other instruments (including this
Agreement and the Certificate of Limited Partnership and all amendments or
restatements hereof or thereof) that the Board of Directors or the Liquidator
determines to be necessary or appropriate to form, qualify or continue the
existence or qualification of the Partnership as a limited partnership (or a
partnership in which the limited partners have limited liability) in the
Marshall Islands and in all other jurisdictions in which the Partnership may
conduct business or own property; (B) all certificates, documents and other
instruments that the Board of Directors or the Liquidator determines to be
necessary or appropriate to reflect, in accordance with its terms, any
amendment, change, modification or restatement of this Agreement; (C) all
certificates, documents and other instruments (including conveyances and a
certificate of cancellation) that the Board of Directors or the Liquidator
determines to be necessary or appropriate to reflect the dissolution and
liquidation of the Partnership pursuant to the terms of this Agreement; (D) all
certificates, documents and other instruments relating to the admission,
withdrawal, removal or substitution of any Partner pursuant to, or other events
described in, Articles IV, X, XI or XII; (E) all certificates, documents and
other instruments relating to the determination of the rights, preferences and
privileges of any class or series of Partnership Securities issued pursuant to
Section 5.5; and (F) all certificates, documents and other instruments
(including agreements and a certificate of merger) relating to a merger,
consolidation or conversion of the Partnership pursuant to Article XIV;
and
(ii) execute,
swear to, acknowledge, deliver, file and record all ballots, consents,
approvals, waivers, certificates, documents and other instruments that the Board
of Directors or the Liquidator determines to be necessary or appropriate to (A)
make, evidence, give, confirm or ratify any vote, consent, approval, agreement
or other action that is made or given by the Partners hereunder or is consistent
with the terms of this Agreement or (B) effectuate the terms or intent of this
Agreement; provided, however, that when
required by Section 13.3 or any other provision of this Agreement that requires
the consent of the Board of Directors or establishes a percentage of the Limited
Partners or of the Limited Partners of any class or series required to take any
action, the Board of Directors and the Liquidator may exercise the power of
attorney made in this Section 2.6(a)(ii) only after the necessary consent of the
Board of Directors or vote, consent or approval of the Limited Partners or of
the Limited Partners of such class or series, as applicable.
Nothing
contained in this Section 2.6(a) shall be construed as authorizing the Board of
Directors to make an amendment to this Agreement except in accordance with
Article XIII or as may be otherwise expressly provided for in this
Agreement.
(b) The
foregoing power of attorney is hereby declared to be irrevocable and a power
coupled with an interest, and it shall survive and, to the maximum extent
permitted by law, not be affected by the subsequent death, incompetency,
disability, incapacity, dissolution, bankruptcy or termination of any Limited
Partner and the transfer of all or any portion of such Limited Partner’s
Partnership Interest and shall extend to such Limited Partner’s heirs,
successors, assigns and personal representatives. Each such Limited Partner
hereby agrees to be bound by any representation made by the Board of Directors,
the Chairman of the Board of Directors, Vice Chairman of the Board of Directors,
Chief Executive Officer or President of the Partnership or the Liquidator acting
in good faith pursuant to such power of attorney; and each such Limited Partner,
to the maximum extent permitted by law, hereby waives any and all defenses that
may be available to contest, negate or disaffirm the action of the Board of
Directors, the Chairman of the Board of Directors, Vice Chairman of the Board of
Directors, Chief Executive Officer or President of the Partnership or the
Liquidator taken in good faith under such power of attorney. Each Limited
Partner shall execute and deliver to the Chairman of the Board of Directors,
Vice Chairman of the Board of Directors, Chief Executive Officer or President of
the Partnership or the Liquidator, within 15 days after receipt of the request
therefor, such further designation, powers of attorney and other instruments as
the Chairman of the Board of Directors, Vice Chairman of the Board of Directors,
Chief Executive Officer or President of the Partnership or the Liquidator
determines to be necessary or appropriate to effectuate this Agreement and the
purposes of the Partnership.
Section
2.7 Term. The
term of the Partnership commenced upon the filing of the Certificate of Limited
Partnership in accordance with the Marshall Islands Act and shall continue in
existence until the dissolution of the Partnership in accordance with the
provisions of Article XII. The existence of the Partnership as a separate legal
entity shall continue until the cancellation of the Certificate of Limited
Partnership as provided in the Marshall Islands Act.
Section
2.8 Title to Partnership
Assets. Title to Partnership assets, whether real,
personal or mixed and whether tangible or intangible, shall be deemed to be
owned by the Partnership as an entity, and no Partner, individually or
collectively, shall have any ownership interest in such Partnership assets or
any portion thereof. Title to any or all of the Partnership assets may be held
in the name of the Partnership, the General Partner, one or more of its
Affiliates or one or more nominees, as the Board of Directors may determine. The
General Partner hereby declares and warrants that any Partnership assets for
which record title is held in the name of the General Partner or one or more of
its Affiliates or one or more nominees shall be held by the General Partner or
such Affiliate or nominee for the use and benefit of the Partnership in
accordance with the provisions of this Agreement; provided, however, that the
General Partner shall use commercially reasonable efforts to cause record title
to such assets (other than those assets in respect of which the Board of
Directors determines that the expense and difficulty of conveyancing makes
transfer of record title to the Partnership impracticable) to be vested in the
Partnership as soon as reasonably practicable; and, provided further, that, prior
to the withdrawal or removal of the General Partner or as soon thereafter as
practicable, the General Partner shall use reasonable efforts to effect the
transfer of record title to the Partnership and, prior to any such transfer,
will provide for the use of such assets in a manner satisfactory to the Board of
Directors. All Partnership assets shall be recorded as the property of the
Partnership in its books and records, irrespective of the name in which record
title to such Partnership assets is held.
RIGHTS
OF LIMITED PARTNERS
Section
3.1 Limitation of
Liability. The Limited Partners shall have no
liability under this Agreement except as expressly provided in this Agreement or
the Marshall Islands Act.
Section
3.2 Management of
Business. No Limited Partner, in its capacity as
such, shall participate in the operation, management or control (within the
meaning of the Marshall Islands Act) of the Partnership’s business, transact any
business in the Partnership’s name or have the power to sign documents for or
otherwise bind the Partnership. Any action taken by any Affiliate of the General
Partner or any officer, director, employee, manager, member, general partner,
agent or trustee of the General Partner or any of its Affiliates, or any
officer, director, employee, manager, member, general partner, agent or trustee
of a Group Member, in its capacity as such, shall not be deemed to be
participation in the control of the business of the Partnership by a limited
partner of the Partnership (within the meaning of Section 30 of the Marshall
Islands Act) and shall not affect, impair or eliminate the limitations on the
liability of the Limited Partners under this Agreement.
Section
3.3 Outside Activities of the
Limited Partners. Subject to the provisions of
Section 7.13 and the Omnibus Agreement, which shall continue to be applicable to
the Persons referred to therein, regardless of whether such Persons shall also
be Limited Partners, any Limited Partner shall be entitled to and may have
business interests and engage in business activities in addition to those
relating to the Partnership, including business interests and activities in
direct competition with the Partnership Group. Neither the Partnership nor any
of the other Partners shall have any rights by virtue of this Agreement in any
business ventures of any Limited Partner.
Section
3.4 Rights of Limited
Partners.
(a) In
addition to other rights provided by this Agreement or by applicable law, and
except as limited by Section 3.4(b), each Limited Partner shall have the right,
for a purpose reasonably related to such Limited Partner’s interest as a Limited
Partner in the Partnership, upon reasonable written demand and at such Limited
Partner’s own expense, to:
(i) have
furnished to him a current list of the name and last known business, residence
or mailing address of each Partner;
(ii) obtain
true and full information regarding the amount of cash and a description and
statement of the Net Agreed Value of any other Capital Contribution by each
Partner and which each Partner has agreed to contribute in the future, and the
date on which each became a Partner;
(iii) have
furnished to him a copy of this Agreement and the Certificate of Limited
Partnership and all amendments thereto, together with a copy of the executed
copies of all powers of attorney pursuant to which this Agreement, the
Certificate of Limited Partnership and all amendments thereto have been
executed;
(iv) obtain
true and full information regarding the status of the business and financial
condition of the Partnership Group; and
(v) obtain
such other information regarding the affairs of the Partnership as is just and
reasonable.
(b) The
Board of Directors may keep confidential from the Limited Partners, for such
period of time as the Board of Directors deems reasonable, (i) any information
that the Board of Directors reasonably believes to be in the nature of trade
secrets or (ii) other information the disclosure of which the Board of Directors
in good faith believes (A) is not in the best interests of the Partnership
Group, (B) could damage the Partnership Group or (C) that any Group Member is
required by law or by agreement with any third party to keep confidential (other
than agreements with Affiliates of the Partnership the primary purpose of which
is to circumvent the obligations set forth in this Section
3.4).
CERTIFICATES;
RECORD HOLDERS; TRANSFER OF PARTNERSHIP INTERESTS
Section
4.1 Certificates. Upon
the Partnership’s issuance of Common Units, Subordinated Units or Subordinated
Series A Units to any Person, the Partnership shall issue, upon the request of
such Person, one or more Certificates in the name of such Person evidencing the
number of such Units being so issued. In addition, (a) upon the General
Partner’s request, the Partnership shall issue to it one or more Certificates in
the name of the General Partner evidencing its General Partner Units and (b)
upon the request of any Person owning Incentive Distribution Rights or any other
Partnership Securities other than Common Units or Subordinated Units, the
Partnership shall issue to such Person one or more certificates evidencing such
Incentive Distribution Rights or other Partnership Securities other than Common
Units or Subordinated Units. Certificates shall be executed on behalf of the
Partnership by the Chief Financial Officer or the Secretary or any Assistant
Secretary of the Partnership. No Common Unit Certificate shall be valid for any
purpose until it has been countersigned by the Transfer Agent; provided, however, that if the
Board of Directors elects to issue Common Units in global form, the Common Unit
Certificates shall be valid upon receipt of a certificate from the Transfer
Agent certifying that the Common Units have been duly registered in accordance
with the directions of the Partnership. Subject to the requirements of Sections
6.5 and 6.6, respectively, the Partners holding Certificates evidencing
Subordinated Units or Subordinated Series A Units may exchange such Certificates
for Certificates evidencing Common Units on or after the date on which such
Subordinated Series A Units or Subordinated Units are converted into Common
Units pursuant to the terms of Sections 5.7 and 5.8,
respectively.
Section
4.2 Mutilated, Destroyed, Lost
or Stolen Certificates.
(a) If
any mutilated Certificate is surrendered to the Transfer Agent, the appropriate
Officers on behalf of the Partnership shall execute, and the Transfer Agent
shall countersign and deliver in exchange therefor, a new Certificate evidencing
the same number and type of Partnership Securities as the Certificate so
surrendered.
(b) The
appropriate Officers on behalf of the Partnership shall execute and deliver, and
the Transfer Agent shall countersign, a new Certificate in place of any
Certificate previously issued if the Record Holder of the
Certificate:
(i) makes
proof by affidavit, in form and substance satisfactory to the Partnership, that
a previously issued Certificate has been lost, destroyed or
stolen;
(ii) requests
the issuance of a new Certificate before the Partnership has notice that the
Certificate has been acquired by a purchaser for value in good faith and without
notice of an adverse claim;
(iii) if
requested by the Partnership, delivers to the Partnership a bond, in form and
substance satisfactory to the Partnership, with surety or sureties and with
fixed or open penalty as the Board of Directors may direct to indemnify the
Partnership, the Partners, the General Partner and the Transfer Agent against
any claim that may be made on account of the alleged loss, destruction or theft
of the Certificate; and
(iv) satisfies
any other reasonable requirements imposed by the Board of
Directors.
If a
Limited Partner fails to notify the Partnership within a reasonable period of
time after he has notice of the loss, destruction or theft of a Certificate, and
a transfer of the Limited Partner Interests represented by the Certificate is
registered before the Partnership, the General Partner or the Transfer Agent
receives such notification, the Limited Partner shall be precluded from making
any claim against the Partnership, the General Partner or the Transfer Agent for
such transfer or for a new Certificate.
(c) As
a condition to the issuance of any new Certificate under this Section 4.2, the
Partnership may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Transfer Agent) reasonably
connected therewith.
Section
4.3 Record
Holders. The Partnership shall be entitled to
recognize the Record Holder as the Partner with respect to any Partnership
Interest and, accordingly, shall not be bound to recognize any equitable or
other claim to, or interest in, such Partnership Interest on the part of any
other Person, regardless of whether the Partnership shall have actual or other
notice thereof, except as otherwise provided by law or any applicable rule,
regulation, guideline or requirement of any National Securities Exchange on
which such Partnership Interests are listed or admitted to trading. Without
limiting the foregoing, when a Person (such as a broker, dealer, bank, trust
company or clearing corporation or an agent of any of the foregoing) is acting
as nominee, agent or in some other representative capacity for another Person in
acquiring and/or holding Partnership Interests, as between the Partnership on
the one hand, and such other Persons on the other, such representative Person
shall be the Record Holder of such Partnership Interest.
Section
4.4 Transfer
Generally.
(a) The
term “transfer,” when used in this Agreement with respect to a Partnership
Interest, shall be deemed to refer to a transaction (i) by which the General
Partner assigns its General Partner Interest to another Person or by which a
holder of Incentive Distribution Rights assigns its Incentive Distribution
Rights to another Person, and includes a sale, assignment, gift, pledge,
encumbrance, hypothecation, mortgage, exchange or any other disposition by law
or otherwise or (ii) by which the holder of a Limited Partner Interest (other
than an Incentive Distribution Right) assigns such Limited Partner Interest to
another Person who is or becomes a Limited Partner, and includes a sale,
assignment, gift, exchange or any other disposition by law or otherwise,
including any transfer upon foreclosure of any pledge, encumbrance,
hypothecation or mortgage.
(b) No
Partnership Interest shall be transferred, in whole or in part, except in
accordance with the terms and conditions set forth in this Article IV. Any
transfer or purported transfer of a Partnership Interest not made in accordance
with this Article IV shall be null and void.
(c) Nothing
contained in this Agreement shall be construed to prevent a disposition by any
stockholder, member, partner or other owner of the General Partner of any or all
of the shares of stock, membership interests, partnership interests or other
ownership interests in the General Partner.
Section
4.5 Registration and Transfer of
Limited Partner Interests.
(a) The
General Partner shall keep or cause to be kept on behalf of the Partnership a
register in which, subject to such reasonable regulations as it may prescribe
and subject to the provisions of Section 4.5(b), the Partnership will provide
for the registration and transfer of Limited Partner Interests. The Transfer
Agent is hereby appointed registrar and transfer agent for the purpose of
registering Common Units and transfers of such Common Units as herein provided.
The Partnership shall not recognize transfers of Certificates evidencing Limited
Partner Interests unless such transfers are effected in the manner described in
this Section 4.5. Upon surrender of a Certificate for registration of transfer
of any Limited Partner Interests evidenced by a Certificate, and subject to the
provisions of Section 4.5(b), the appropriate Officers on behalf of the
Partnership shall execute and deliver, and in the case of Common Units, the
Transfer Agent shall countersign and deliver, in the name of the holder or the
designated transferee or transferees, as required pursuant to the holder’s
instructions, one or more new Certificates evidencing the same aggregate number
and type of Limited Partner Interests as was evidenced by the Certificate so
surrendered.
(b) The
Partnership shall not recognize any transfer of Limited Partner Interests until
the Certificates evidencing such Limited Partner Interests are surrendered for
registration of transfer. No charge shall be imposed by the Partnership for such
transfer; provided, however, that as a
condition to the issuance of any new Certificate under this Section 4.5, the
Partnership may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed with respect
thereto.
(c) The
General Partner and its Affiliates shall have the right at any time to transfer
their Subordinated Units and Common Units (whether issued upon conversion of the
Subordinated Units or otherwise) to one or more Persons. Notwithstanding the
foregoing, the holder of any Subordinated Series A Units shall not sell, dispose
or otherwise transfer such Subordinated Series A Units to any entity or
individual (other than to an Affiliate of the holder) without the prior written
consent of the General Partner, which consent shall be at the sole discretion of
the General Partner. Upon issuance, the Common Units issued upon conversion of
the Subordinated Series A Units shall not be subject to such restrictions on
transfer.
Section
4.6 Transfer of the General
Partner’s General Partner Interest.
(a) Subject
to Section 4.6(c) below, prior to December 31, 2017, the General
Partner shall not transfer all or any part of its General Partner Interest
(represented by General Partner Units) to a Person unless such transfer (i) has
been approved by the prior written consent or vote of the holders of at least a
majority of the Outstanding Common Units (excluding Common Units held by the
General Partner and its Affiliates) or (ii) is of all, but not less than all, of
its General Partner Interest to (A) an Affiliate of the General Partner (other
than an individual) or (B) another Person (other than an individual) in
connection with (1) the merger or consolidation of the General Partner with or
into such other Person or (2) the transfer by the General Partner of all or
substantially all of its assets to such other Person.
(b) Subject
to Section 4.6(c) below, on or after December 31, 2017, the General
Partner may transfer all or any of its General Partner Interest without
Unitholder approval.
(c) Notwithstanding
anything herein to the contrary, no transfer by the General Partner of all or
any part of its General Partner Interest to another Person shall be permitted
unless (i) the transferee agrees to assume the rights and duties of the General
Partner under this Agreement and to be bound by the provisions of this
Agreement, (ii) the Partnership receives an Opinion of Counsel that such
transfer would not result in the loss of limited liability of any Limited
Partner or of any limited partner or member of any other Group Member and (iii)
such transferee also agrees to purchase all (or the appropriate portion thereof,
if applicable) of the partnership or membership interest of the General Partner
as the general partner or managing member, if any, of each other Group Member.
In the case of a transfer pursuant to and in compliance with this Section 4.6,
the transferee or successor (as the case may be) shall, subject to compliance
with the terms of Section 10.3, be admitted to the Partnership as the General
Partner immediately prior to the transfer of the General Partner Interest, and
the business of the Partnership shall continue without
dissolution.
Section
4.7 Transfer of Incentive
Distribution Rights. Prior to
December 31, 2017, a holder of Incentive Distribution Rights may
transfer any or all of the Incentive Distribution Rights held by such holder
without any consent of the Unitholders to (a) an Affiliate of such holder (other
than an individual) or (b) another Person (other than an individual) in
connection with (i) the merger or consolidation of such holder of Incentive
Distribution Rights with or into such other Person or (ii) the transfer by such
holder of all or substantially all of its assets to such other Person. Any other
transfer of the Incentive Distribution Rights prior to
December 31, 2017, shall require the prior approval of holders of at
least a majority of the Outstanding Common Units (excluding Common Units held by
the General Partner and its Affiliates). On or after
December 31, 2017, the General Partner or any other holder of
Incentive Distribution Rights may transfer any or all of its Incentive
Distribution Rights without Unitholder approval. Notwithstanding anything herein
to the contrary, no transfer of Incentive Distribution Rights to another Person
shall be permitted unless the transferee agrees to be bound by the provisions of
this Agreement. The General Partner and any transferee or transferees of the
Incentive Distribution Rights may agree in a separate instrument as to the
General Partner’s exercise of its rights with respect to the Incentive
Distribution Rights under Section 11.3 hereof.
Section
4.8 Restrictions on
Transfers.
(a) Except
as provided in Section 4.8(c) below, but notwithstanding the other provisions of
this Article IV, no transfer of any Partnership Interests shall be made if such
transfer would (i) violate the then applicable U.S. federal or state securities
laws, laws of the Republic of the Marshall Islands or rules and regulations of
the Commission, any state securities commission or any other governmental
authority with jurisdiction over such transfer or (ii) terminate the existence
or qualification of the Partnership or any Group Member under the laws of the
jurisdiction of its formation.
(b) The
transfer of a Subordinated Unit or a Subordinated Series A Unit that has
converted into a Common Unit shall be subject to the restrictions imposed by
Sections 6.5 and 6.6, respectively.
(c) Nothing
contained in this Article IV, or elsewhere in this Agreement, shall preclude the
settlement of any transactions involving Partnership Interests entered into
through the facilities of any National Securities Exchange on which such
Partnership Interests are listed or admitted to trading.
CAPITAL
CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS
Section
5.1 Contributions Prior to the
Closing Date.
(a) In
connection with the formation of the Partnership under the Marshall Islands Act,
the General Partner made an initial Capital Contribution to the Partnership in
the amount of $20, for a 2% General Partner Interest in the Partnership (the
“Initial General
Partner Interest”) and has been admitted as the General Partner of the
Partnership, and the Organizational Limited Partner made an initial Capital
Contribution to the Partnership in the amount of $980 for a 98% limited partner
interest in the Partnership (the “Initial Limited Partner
Interest”) and has been admitted as a Limited Partner of the Partnership.
As of the Closing Date, the Initial Limited Partner Interest shall be redeemed
and the initial Capital Contribution of the Organizational Limited Partner shall
be refunded. Ninety-eight percent of any interest or profit that may have
resulted from the investment of such initial Capital Contribution shall be
allocated and distributed to the Organizational Limited Partner, and the balance
shall be allocated and distributed to the General Partner.
(b) On
November 16, 2007, and pursuant to the First Contribution Agreement, Navios
Maritime Holdings contributed all of the outstanding shares of capital stock of
Felicity Shipping Corporation to the Partnership in exchange for 4,195,000
Subordinated Units.
Section
5.2 Initial Unit
Issuances.
(a) On
the Closing Date and pursuant to the Second Contribution Agreement: (i) The
General Partner’s Initial General Partner Interest shall be converted into
369,834 General Partner Units and the Incentive Distribution Rights; (ii) Navios
Maritime Holdings shall sell to the Partnership all of the shares of capital
stock of Gemini Shipping Corporation, Alegria Shipping Corporation, Galaxy
Shipping Corporation, Libra Shipping Enterprises Corporation, Prosperity
Shipping Corporation, Aldebaran Shipping Corporation and Fantastiks Shipping
Corporation in exchange for (A) the issuance to Navios Maritime of
3,426,843 Subordinated Units and a special interest representing the right to
receive $353.3 million from the Partnership on the Closing Date and (B) the
issuance to the General Partner of the Incentive Distribution Rights; and (iii)
the Organizational Limited Partner’s Initial Limited Partner Interest shall be
redeemed and its initial Capital Contribution shall be
refunded.
(b) Upon
the issuance of any additional Limited Partner Interests by the Partnership
(other than Common Units issued in the Initial Offering, including any Common
Units issued pursuant to the Over-Allotment Option), the General Partner may, in
exchange for a proportionate number of General Partner Units, make additional
Capital Contributions in an amount equal to the product obtained by multiplying
(i) the quotient determined by dividing (A) the General Partner’s Percentage
Interest immediately prior to such issuance by (B) 100 less the General
Partner’s Percentage Interest immediately prior to such issuance by (ii) the
amount contributed to the Partnership by the Limited Partners in exchange for
such additional Limited Partner Interests. The General Partner shall not be
obligated to make additional Capital Contributions to the
Partnership.
Section
5.3 Contributions By Initial
Limited Partners and Distributions to the General Partner and its
Affiliates.
(a) On
the Closing Date and pursuant to the Purchase Agreement, each Underwriter shall
contribute to the Partnership cash in an amount equal to the Issue Price per
Initial Common Unit, multiplied by the number of Common Units specified in the
Purchase Agreement to be purchased by such Underwriter at the Closing Date. In
exchange for such Capital Contributions by the Underwriters, the Partnership
shall issue Common Units to each Underwriter on whose behalf such Capital
Contribution is made in an amount equal to the number of Common Units specified
in the Purchase Agreement to be purchased by such Underwriter on the Closing
Date.
(b) On
the Closing Date and pursuant to the Common Unit Purchase Agreement, Amadeus
Maritime shall contribute to the Partnership cash in the amount of $10.0 million
in exchange for such Capital Contribution, the Partnership shall issue 500,000
Common Units to Amadeus Maritime.
(c) Upon
any exercise of the Over-Allotment Option, each Underwriter shall contribute to
the Partnership cash in an amount equal to the Issue Price per Initial Common
Unit, multiplied by the number of Common Units to be purchased by such
Underwriter at the Option Closing Date. In exchange for such Capital
Contributions by the Underwriters, the Partnership shall issue Common Units to
each Underwriter on whose behalf such Capital Contribution is made in an amount
equal to the quotient obtained by dividing (i) the cash contributions to the
Partnership by or on behalf of such Underwriter by (ii) the Issue Price per
Initial Common Unit. Upon receipt by the Partnership of the Capital
Contributions from the Underwriters as provided in this Section 5.3(c), the
Partnership shall use such cash to redeem from Navios Maritime Holdings that
number of Subordinated Units equal to the number of Common Units issued to the
Underwriters as provided in this Section 5.3(c).
(d) No
Limited Partner Interests will be issued or issuable as of or at the Closing
Date other than (i) the Common Units issuable pursuant to subparagraphs (a) and
(b) of this Section 5.3 in aggregate number equal to 10,500,000, (ii) the “Option Units” as such
term is used in the Purchase Agreement in an aggregate number up to 1,500,000
issuable upon exercise of the Over-Allotment Option pursuant to subparagraph (b)
hereof, (iii) the 7,621,843 Subordinated Units issued or issuable to pursuant to
Sections 5.1(b) and 5.2(a) hereof and (iv) the Incentive Distribution
Rights.
Section
5.4 Interest and
Withdrawal. No interest shall be paid by the
Partnership on Capital Contributions. No Partner shall be entitled to the
withdrawal or return of its Capital Contribution, except to the extent, if any,
that distributions made pursuant to this Agreement or upon termination of the
Partnership may be considered and permitted as such by law and then only to the
extent provided for in this Agreement. Except to the extent expressly provided
in this Agreement, no Partner shall have priority over any other Partner either
as to the return of Capital Contributions or as to profits, losses or
distributions.
Section
5.5 Issuances of Additional
Partnership Securities.
(a) The
Partnership may issue additional Partnership Securities and options, rights,
warrants and appreciation rights relating to the Partnership Securities for any
Partnership purpose at any time and from time to time to such Persons for such
consideration and on such terms and conditions as the Board of Directors shall
determine, all without the approval of any Limited Partners, but subject to the
approval of the General Partner in the case where issuances of equity are not
reasonably expected to be accretive to equity within twelve months of issuance
or which would otherwise have a material adverse impact on the General Partner
or the General Partner Interest.
(b) Each
additional Partnership Security authorized to be issued by the Partnership
pursuant to Section 5.5(a) may be issued in one or more classes, or one or more
series of any such classes, with such designations, preferences, rights, powers
and duties (which may be senior to existing classes and series of Partnership
Securities), as shall be fixed by the Board of Directors, including (i) the
right to share in Partnership distributions; (ii) the rights upon dissolution
and liquidation of the Partnership; (iii) whether, and the terms and conditions
upon which, the Partnership may or shall be required to redeem the Partnership
Security (including sinking fund provisions); (iv) whether such Partnership
Security is issued with the privilege of conversion or exchange and, if so, the
terms and conditions of such conversion or exchange; (v) the terms and
conditions upon which each Partnership Security will be issued, evidenced by
certificates and assigned or transferred; (vi) the method for determining the
Percentage Interest as to such Partnership Security; and (vii) the right, if
any, of each such Partnership Security to vote on Partnership matters, including
matters relating to the relative rights, preferences and privileges of such
Partnership Security.
(c) The
Board of Directors shall take all actions that it determines to be necessary or
appropriate in connection with (i) each issuance of Partnership Securities and
options, rights, warrants and appreciation rights relating to Partnership
Securities pursuant to this Section 5.5, (ii) the conversion of the General
Partner Interest (represented by General Partner Units) or any Incentive
Distribution Rights into Units pursuant to the terms of this Agreement, (iii)
the admission of additional Limited Partners and (iv) all additional issuances
of Partnership Securities. The Board of Directors shall determine the relative
rights, powers and duties of the holders of the Units or other Partnership
Securities being so issued. The Board of Directors shall do all things necessary
to comply with the Marshall Islands Act and is authorized and directed to do all
things that it determines to be necessary or appropriate in connection with any
future issuance of Partnership Securities or in connection with the conversion
of the General Partner Interest or any Incentive Distribution Rights into Units
pursuant to the terms of this Agreement, including compliance with any statute,
rule, regulation or guideline of any federal, state or other governmental agency
or any National Securities Exchange on which the Units or other Partnership
Securities are listed or admitted to trading.
Section
5.6 Limitations on Issuance of
Additional Partnership Securities. The Partnership
may issue an unlimited number of Partnership Securities (or options, rights,
warrants or appreciation rights related thereto) pursuant to Section 5.5 without
the approval of the Limited Partners; provided, however, that no
fractional units shall be issued by the Partnership.
Section
5.7 Conversion of Subordinated
Units.
(a) All
of the Outstanding Subordinated Units will convert into Common Units on a
one-for-one basis on the second Business Day following the distribution of
Available Cash to Partners pursuant to Section 6.1(a) in respect of any Quarter
ending on or after December 31, 2008, in respect of
which:
(i) distributions
of Available Cash from Operating Surplus under Section 6.2(a) on each of the
Outstanding Common Units, Subordinated Units, General Partner Units and any
other Outstanding Units that are senior or equal in right of distribution to the
Subordinated Units (other than the Subordinated Series A Units) equaled or
exceeded $2.10 during the four-Quarter period immediately preceding such
date;
(ii) the
Adjusted Operating Surplus for the four-Quarter period immediately preceding
such date equaled or exceeded the sum of $2.10 on all of the Common Units,
Subordinated Units, General Partner Units and any other Units that are senior or
equal in right of distribution to the Subordinated Units (other than the
Subordinated Series A Units) that were Outstanding during such period on a Fully
Diluted Basis with respect to such period; and
(iii) there
are no Cumulative Common Unit Arrearages.
(b) If
the Subordinated Units are not converted into Common Units pursuant to Section
5.7(a), the Subordinated Units shall convert into Common Units on a one-for-one
basis upon the expiration of the Subordination Period.
(c) Notwithstanding
any other provision of this Agreement, the Subordinated Units will automatically
convert into Common Units on a one-for-one basis as set forth in, and pursuant
to the terms of, Section 11.4.
(d) A
Subordinated Unit that has converted into a Common Unit shall be subject to the
provisions of Section 6.5.
Section
5.8 Conversion of Subordinated
Series A Units. All of the outstanding Subordinated Series A Units will
automatically convert into Common Units on a one-for-one basis on the earlier of
(a) June 29, 2012, (b) upon a Change of Control, or (c) the Liquidation Date. A
Subordinated Series A Unit that has converted into a Common Unit shall be
subject to the provisions of Section 6.6.
Section
5.9 Limited Preemptive
Right. Except as provided in this Section 5.9 and
in Section 5.2(b), no Person shall have any preemptive, preferential or
other similar right with respect to the issuance of any Partnership Security,
whether unissued, held in the treasury or hereafter created. The General Partner
shall have the right, which it may from time to time assign in whole or in part
to any of its Affiliates, to purchase Partnership Securities from the
Partnership whenever, and on the same terms that, the Partnership issues
Partnership Securities to Persons other than the General Partner and its
Affiliates, to the extent necessary to maintain the Percentage Interests of the
General Partner and its Affiliates equal to that which existed immediately prior
to the issuance of such Partnership Securities.
Section
5.10 Splits and
Combinations.
(a) Subject
to Sections 5.10(d) and 6.4 (dealing with adjustments of distribution levels),
the Partnership may make a Pro Rata distribution of Partnership Securities to
all Record Holders or may effect a subdivision or combination of Partnership
Securities so long as, after any such event, each Partner shall have the same
Percentage Interest in the Partnership as before such event, and any amounts
calculated on a per Unit basis (including any Common Unit Arrearage or
Cumulative Common Unit Arrearage) or stated as a number of Units are
proportionately adjusted.
(b) Whenever
such a distribution, subdivision or combination of Partnership Securities is
declared, the Board of Directors shall select a Record Date as of which the
distribution, subdivision or combination shall be effective and shall send
notice thereof at least 20 days prior to such Record Date to each Record Holder
as of a date not less than 10 days prior to the date of such notice. The Board
of Directors also may cause a firm of independent public accountants selected by
it to calculate the number of Partnership Securities to be held by each Record
Holder after giving effect to such distribution, subdivision or combination. The
Board of Directors shall be entitled to rely on any certificate provided by such
firm as conclusive evidence of the accuracy of such
calculation.
(c) Promptly
following any such distribution, subdivision or combination, the Partnership may
issue Certificates to the Record Holders of Partnership Securities as of the
applicable Record Date representing the new number of Partnership Securities
held by such Record Holders, or the Board of Directors may adopt such other
procedures that it determines to be necessary or appropriate to reflect such
changes. If any such combination results in a smaller total number of
Partnership Securities Outstanding, the Partnership shall require, as a
condition to the delivery to a Record Holder of such new Certificate, the
surrender of any Certificate held by such Record Holder immediately prior to
such Record Date.
(d) The
Partnership shall not issue fractional Units upon any distribution, subdivision
or combination of Units. If a distribution, subdivision or combination of Units
would result in the issuance of fractional Units but for the provisions of this
Section 5.10(d), each fractional Unit shall be rounded to the nearest whole Unit
(and a 0.5 Unit shall be rounded to the next higher Unit).
Section
5.11 Fully Paid and
Non-Assessable Nature of Limited Partner
Interests. All Limited Partner Interests issued
pursuant to, and in accordance with the requirements of, this Article V shall be
fully paid and non-assessable Limited Partner Interests in the Partnership,
except as such non-assessability may be affected by the Marshall Islands
Act.
Section
6.1 Requirement and
Characterization of Distributions; Distributions to Record
Holders.
(a) Within
45 days following the end of each Quarter commencing with the Quarter ending on
December 31, 2007, an amount equal to 100% of Available Cash with
respect to such Quarter shall, subject to Section 51 of the Marshall Islands
Act, be distributed in accordance with this Article VI by the Partnership to the
Partners as of the Record Date selected by the Board of Directors. All amounts
of Available Cash distributed by the Partnership on any date from any source
shall be deemed to be Operating Surplus until the sum of all amounts of
Available Cash theretofore distributed by the Partnership to the Partners
pursuant to Section 6.2 equals the Operating Surplus from the Closing Date
through the close of the immediately preceding Quarter. Any remaining amounts of
Available Cash distributed by the Partnership on such date shall, except as
otherwise provided in Section 6.3, be deemed to be “Capital
Surplus.”
(b) Notwithstanding
Section 6.1(a), in the event of the dissolution and liquidation of the
Partnership, all receipts received during or after the Quarter in which the
Liquidation Date occurs, other than from borrowings described in (a)(ii) of the
definition of Available Cash, shall be applied and distributed solely in
accordance with, and subject to the terms and conditions of, Section
12.4.
(c) Each
distribution in respect of a Partnership Interest shall be paid by the
Partnership, directly or through the Transfer Agent or through any other Person
or agent, only to the Record Holder of such Partnership Interest as of the
Record Date set for such distribution. Such payment shall constitute full
payment and satisfaction of the Partnership’s liability in respect of such
payment, regardless of any claim of any Person who may have an interest in such
payment by reason of an assignment or otherwise.
Section
6.2 Distributions of Available
Cash from Operating Surplus.
(a) During Subordination
Period. Available Cash with respect to any Quarter or portion thereof
within the Subordination Period that is deemed to be Operating Surplus pursuant
to the provisions of Sections 6.1 or 6.3 shall, subject to Section 51 of the
Marshall Islands Act, be distributed as follows, except as otherwise
contemplated by Section 5.5 in respect of other Partnership Securities issued
pursuant thereto:
(i) First,
(x) to the General Partner in accordance with its Percentage Interest and (y) to
all the Unitholders holding Common Units, Pro Rata, a percentage equal to 100%
less the General Partner’s Percentage Interest, until there has been distributed
in respect of each Common Unit then Outstanding an amount equal to the Minimum
Quarterly Distribution for such Quarter;
(ii) Second,
(x) to the General Partner in accordance with its Percentage Interest and (y) to
all Unitholders holding Common Units, Pro Rata, a percentage equal to 100% less
the General Partner’s Percentage Interest, until there has been distributed in
respect of each Common Unit then Outstanding an amount equal to the Cumulative
Common Unit Arrearage existing with respect to such Quarter;
(iii) Third,
(x) to the General Partner in accordance with its Percentage Interest and (y) to
all Unitholders holding Subordinated Units, Pro Rata, a percentage equal to 100%
less the General Partner’s Percentage Interest, until there has been distributed
in respect of each Subordinated Unit then Outstanding an amount equal to the
Minimum Quarterly Distribution for such Quarter;
(iv) Fourth,
to the General Partner and all holders of Common Units and Subordinated Units,
in accordance with their respective Percentage Interests, until there has been
distributed in respect of each Unit then Outstanding (other than Subordinated
Series A Units) an amount equal to the excess of the First Target Distribution
over the Minimum Quarterly Distribution for such Quarter;
(v) Fifth,
(A) to the General Partner in accordance with its Percentage Interest; (B) 13%
to the holders of the Incentive Distribution Rights, Pro Rata; and (C) to all
holders of Common Units and Subordinated Units, Pro Rata, a percentage equal to
100% less the sum of the percentages applicable to subclauses (A) and (B) of
this clause (v) until there has been distributed in respect of each Unit then
Outstanding (other than Subordinated Series A Units) an amount equal to the
excess of the Second Target Distribution over the First Target Distribution for
such Quarter;
(vi) Sixth,
(A) to the General Partner in accordance with its Percentage Interest, (B) 23%
to the holders of the Incentive Distribution Rights, Pro Rata; and (C) to all
holders of Common Units and Subordinated Units, Pro Rata, a percentage equal to
100% less the sum of the percentages applicable to subclauses (A) and (B)
of this subclause (vi), until there has been distributed in respect of each Unit
then Outstanding (other than Subordinated Series A Units) an amount equal to the
excess of the Third Target Distribution over the Second Target Distribution for
such Quarter; and
(vii) Thereafter,
(A) to the General Partner in accordance with its Percentage Interest;
(B) 48% to the holders of the Incentive Distribution Rights, Pro Rata; and
(C) to all holders of Common Units and Subordinated Units, Pro Rata, a
percentage equal to 100% less the sum of the percentages applicable to
subclauses (A) and (B) of this clause (vii);
provided, however, that if the
Minimum Quarterly Distribution, the First Target Distribution, the Second Target
Distribution and the Third Target Distribution have been reduced to zero
pursuant to the second sentence of Section 6.4, the distribution of Available
Cash that is deemed to be Operating Surplus with respect to any Quarter will be
made solely in accordance with Section 6.2(a)(vii).
(b) After Subordination
Period. Available Cash with respect to any Quarter after the
Subordination Period that is deemed to be Operating Surplus pursuant to the
provisions of Sections 6.1 or 6.3, shall subject to Section 51 of the
Marshall Islands Act, be distributed as follows, except as otherwise required by
Section 5.5(b) in respect of additional Partnership Securities issued pursuant
thereto:
(i) First,
100% to the General Partner and all holders of Common Units and Subordinated
Units in accordance with their respective Percentage Interests, until there has
been distributed in respect of each Unit then Outstanding (other than
Subordinated Series A Units) an amount equal to the Minimum Quarterly
Distribution for such Quarter;
(ii) Second,
100% to the General Partner and all holders of Common Units and Subordinated
Units in accordance with their respective Percentage Interests, until there has
been distributed in respect of each Unit then Outstanding (other than
Subordinated Series A Units) an amount equal to the excess of the First Target
Distribution over the Minimum Quarterly Distribution for such
Quarter;
(iii) Third,
(A) to the General Partner in accordance with its Percentage Interest; (B) 13%
to the holders of the Incentive Distribution Rights, Pro Rata; and (C) to all
holders of Common Units and Subordinated Units, Pro Rata, a percentage equal to
100% less the sum of the percentages applicable to subclauses (A) and (B)
of this clause (iii), until there has been distributed in respect of each Unit
then Outstanding (other than Subordinated Series A Units) an amount equal to the
excess of the Second Target Distribution over the First Target Distribution for
such Quarter;
(iv) Fourth,
(A) to the General Partner in accordance with its Percentage Interest; (B) 23%
to the holders of the Incentive Distribution Rights, Pro Rata; and (C) to all
holders of Common Units and Subordinated Units, Pro Rata, a percentage equal to
100% less the sum of the percentages applicable to subclause (A) and (B) of this
clause (iv), until there has been distributed in respect of each Unit then
Outstanding (other than Subordinated Series A Units) an amount equal to the
excess of the Third Target Distribution over the Second Target Distribution for
such Quarter; and
(v) Thereafter,
(A) to the General Partner in accordance with its Percentage Interest;
(B) 48% to the holders of the Incentive Distribution Rights, Pro Rata; and
(C) to all holders of Common Units and Subordinated Units, Pro Rata, a
percentage equal to 100% less the sum of the percentages applicable to
subclauses (A) and (B) of this clause (v);
provided, however, that if the
Minimum Quarterly Distribution, the First Target Distribution, the Second Target
Distribution and the Third Target Distribution have been reduced to zero
pursuant to the second sentence of Section 6.4, the distribution of Available
Cash that is deemed to be Operating Surplus with respect to any Quarter will be
made solely in accordance with Section 6.2(b)(v).
Section
6.3 Distributions of Available
Cash from Capital Surplus. Available Cash that is
deemed to be Capital Surplus pursuant to the provisions of Section 6.1(a) shall,
subject to Section 51 of the Marshall Islands Act, be distributed, unless the
provisions of Section 6.1 require otherwise, 100% to the General Partner and all
holders of Common Units and Subordinated Units in accordance with their
respective Percentage Interests, until a hypothetical holder of a Common Unit
acquired on the Closing Date has received with respect to such Common Unit,
during the period since the Closing Date through such date, distributions of
Available Cash that are deemed to be Capital Surplus in an aggregate amount
equal to the Initial Unit Price. Available Cash that is deemed to be Capital
Surplus shall then be distributed (a) to the General Partner in accordance with
its Percentage Interest and (b) to all Unitholders holding Common Units their
Pro Rata share of a percentage equal to 100% less the General Partner’s
Percentage Interest, until there has been distributed in respect of each Common
Unit then Outstanding an amount equal to the Cumulative Common Unit Arrearage.
Thereafter, all Available Cash shall be distributed as if it were Operating
Surplus and shall be distributed in accordance with Section
6.2.
Section
6.4 Adjustment of Minimum
Quarterly Distribution and Target Distribution
Levels. The Minimum Quarterly Distribution, First
Target Distribution, Second Target Distribution, Third Target Distribution,
Common Unit Arrearages and Cumulative Common Unit Arrearages shall be
proportionately adjusted in the event of any distribution, combination or
subdivision (whether effected by a distribution payable in Units or otherwise)
of Units or other Partnership Securities in accordance with Section 5.10. In the
event of a distribution of Available Cash that is deemed to be from Capital
Surplus, the then applicable Minimum Quarterly Distribution, First Target
Distribution, Second Target Distribution and Third Target Distribution, shall be
reduced in the same proportion that the distribution had to the fair market
value of the Common Units prior to the announcement of the distribution. If the
Common Units are publicly traded on a National Securities Exchange, the fair
market value will be the Current Market Price before the ex-dividend date. If
the Common Units are not publicly traded, the fair market value will be
determined by the Board of Directors.
Section
6.5 Special Provisions Relating
to the Holders of Subordinated Units. Except with respect to
the right to vote on or approve matters requiring the vote or approval of a
percentage of the holders of Outstanding Common Units and the right to
participate in distributions made with respect to Common Units, the holder of a
Subordinated Unit shall have all of the rights and obligations of a Unitholder
holding Common Units hereunder; provided, however, that
immediately upon the conversion of Subordinated Units into Common Units pursuant
to Section 5.7, the Unitholder holding a Subordinated Unit shall possess all of
the rights and obligations of a Unitholder holding Common Units hereunder,
including the right to vote as a Common Unitholder and the right to participate
in distributions made with respect to Common Units.
Section
6.6 Special Provisions Relating
to the Holders of Subordinated Series A Units. Until the
conversion of the Subordinated Series A Units into Common Units pursuant to
Section 5.8, the Unitholders holding Subordinated Series A Units shall have no
right to the distribution of Available Cash pursuant to this Article
VI.
Section
6.7 Special Provisions Relating
to the Holders of Incentive Distribution Rights.
Notwithstanding anything to the contrary set forth in this Agreement, the
holders of the Incentive Distribution Rights (a) shall possess the rights and
obligations provided in this Agreement with respect to a Limited Partner
pursuant to Articles III and VII and (b) shall not (i) be entitled to vote on
any matters requiring the approval or vote of the holders of Outstanding Units,
except as provided by law, or (ii) be entitled to any distributions other than
as provided in Sections 6.2(a)(v), 6.2(a)(vi) and 6.2(a)(vii), 6.2(b)(iii),
6.2(b)(iv) and 6.2(b)(v), and 12.4.
MANAGEMENT
AND OPERATION OF BUSINESS
(a) Except
as otherwise expressly provided in this Agreement, all management powers over
the business and affairs of the Partnership shall be vested exclusively in the
Board of Directors and, subject to the direction of the Board of Directors and
in accordance with the provisions of Section 7.11, the Officers. Neither
the General Partner (except as otherwise expressly provided in this Agreement)
nor any Limited Partner shall have any management power or control over the
business and affairs of the Partnership. Thus, except as expressly provided in
this Agreement, the business and affairs of the Partnership shall be managed by
or under the direction of the Board of Directors, and the day-to-day activities
of the Partnership shall be conducted on the Partnership’s behalf by the
Officers. In order to enable the Board of Directors to manage the business and
affairs of the Partnership, the General Partner, except as otherwise expressly
provided in this Agreement, hereby irrevocably delegates to the Board of
Directors all management powers over the business and affairs of the Partnership
that it may now or hereafter possess under applicable law. The General Partner
further agrees to take any and all action necessary and appropriate, in the sole
discretion of the Board of Directors, to effect any duly authorized actions by
the Board of Directors, including executing or filing any agreements,
instruments or certificates, delivering all documents, providing all information
and taking or refraining from taking action as may be necessary or appropriate
to achieve the effective delegation of power described in this Section 7.1(a).
Each of the Partners and each Person who may acquire an interest in a
Partnership Interest hereby approves, consents to, ratifies and confirms such
delegation. The delegation by the General Partner to the Board of Directors of
management powers over the business and affairs of the Partnership pursuant to
the provisions of this Agreement shall not cause the General Partner to cease to
be a general partner of the Partnership nor shall it cause the Board of
Directors or any member thereof to be a general partner of the Partnership or to
have or be subject to the liabilities of a general partner of the
Partnership.
(b) Notwithstanding
any other provision of this Agreement, any Group Member Agreement, the Marshall
Islands Act or any applicable law, rule or regulation, each of the Partners and
each other Person who may acquire an interest in Partnership Securities hereby
(i) approves, consents to, ratifies and confirms the General Partner’s
delegation of management powers to the Board of Directors pursuant to paragraph
(a) of this Section 7.1; (ii) approves, ratifies and confirms the execution,
delivery and performance by the parties thereto of this Agreement, the Purchase
Agreement, the Omnibus Agreement, the First Contribution Agreement, the Second
Contribution Agreement, any Group Member Agreement of any other Group Member and
the other agreements described in or filed as exhibits to the Registration
Statement that are related to the transactions contemplated by the Registration
Statement; (iii) agrees that the General Partner (on behalf of the Partnership)
is authorized to execute, deliver and perform the agreements referred to in
clause (i) of this sentence and the other agreements, acts, transactions and
matters described in or contemplated by the Registration Statement on behalf of
the Partnership without any further act, approval or vote of the Partners or the
other Persons who may acquire an interest in Partnership Securities; and (iv)
agrees that the execution, delivery or performance by the Board of Directors,
the General Partner, any Group Member or any Affiliate of any of them of this
Agreement or any agreement authorized or permitted under this Agreement
(including the exercise by the General Partner or any Affiliate of the General
Partner of the rights accorded pursuant to Article XV) shall not constitute a
breach by the Board of Directors or the General Partner of any duty that the
Board of Directors or the General Partner may owe the Partnership or the Limited
Partners or any other Persons under this Agreement (or any other agreements) or
of any duty stated or implied by law or equity.
Section
7.2 The Board of Directors;
Election and Appointment; Term; Manner of Acting.
(a) Upon
the Closing Date, the Board of Directors shall consist of seven individuals, all
of whom shall be Appointed Directors. Following the first annual meeting of
Unitholders after the Closing Date, the Board of Directors shall consist of
seven individuals, three of which are Appointed Directors and four of which are
Elected Directors. The Elected Directors shall be divided into three classes:
Class I, comprising two Elected Directors, Class II, comprising one Elected
Director, and Class III, comprising one Elected Director. The Board of Directors
upon Closing shall consist of the following individuals, each of whom shall hold
office until his or her successor is duly elected or appointed, as the case may
be, and qualified, in accordance with subclauses (a)(i) and (a)(ii) below, or
until his or her earlier death, resignation or removal: Appointed Directors:
Angeliki Frangou, George Achniotis and Shunji Sasada; Elected Directors: Class
I: Robert Pierot and John Karakadas, Class II: Efstathios Loizos and
Class III: Leonidas Korres. The vacancy among the Appointed Directors shall
be filled as if an Appointed Director had resigned, in accordance with Section
7.6. The successors of the initial members of the Board of Directors shall be
appointed or elected, as the case may be, as follows:
(i) The
Appointed Directors shall be appointed by the General Partner on the date of the
2008 Annual Meeting and each Appointed Director shall hold office until his or
her successor is duly appointed by the General Partner and qualified or until
his or her earlier death, resignation or removal; and
(ii) The
Class I Elected Directors shall be elected at the 2008 Annual Meeting for a
one-year term expiring on the date of the first succeeding Annual Meeting, the
Class II Elected Director shall be elected at the 2008 Annual Meeting for a
two-year term expiring on the second succeeding Annual Meeting and the Class III
Elected Directors shall be elected at the 2008 Annual Meeting for a three-year
term expiring on the third succeeding Annual Meeting, in each case by a
plurality of the votes of the Outstanding Common Units present in person or
represented by proxy at the Annual Meeting with each Outstanding Common Unit
having one vote. At each Annual Meeting after the 2008 Annual Meeting, Elected
Directors so classified who are elected to replace those whose terms expire at
such Annual Meeting shall be elected to hold office until the third succeeding
Annual Meeting.
(b) Except
as provided in paragraph (a)(ii) above with respect to Elected Directors elected
at the 2008 Annual Meeting, each member of the Board of Directors appointed or
elected, as the case may be, at an Annual Meeting shall hold office until the
third succeeding Annual Meeting and until his or her successor is duly elected
or appointed, as the case may be, and qualified, or until his or her earlier
death, resignation or removal.
(c) Each
member of the Board of Directors shall have one vote. The vote of the majority
of the members of the Board of Directors present at a meeting at which a quorum
is present shall be the act of the Board of Directors. A majority of the number
of members of the Board of Directors then in office shall constitute a quorum
for the transaction of business at any meeting of the Board of Directors, but if
less than a quorum is present at a meeting, a majority of the members of the
Board of Directors present at such meeting may adjourn the meeting from time to
time, without notice other than announcement at the meeting, until a quorum
shall be present.
Section
7.3 Nominations of Elected
Directors. The Board of Directors shall be
entitled to nominate individuals to stand for election as Elected Directors at
an Annual Meeting. In addition, any Limited Partner or Group of Limited Partners
that beneficially owns 10% or more of the Outstanding Common Units shall be
entitled to nominate one or more individuals to stand for election as Elected
Directors at an Annual Meeting by providing written notice thereof to the Board
of Directors not more than 120 days and not less than 90 days prior to the date
of such Annual Meeting; provided, however, that in the
event that the date of the Annual Meeting was not publicly announced by the
Partnership by mail, press release or otherwise more than 100 days prior to the
date of such meeting, such notice, to be timely, must be delivered to the Board
of Directors not later than the close of business on the tenth day following the
date on which the date of the Annual Meeting was announced. Such notice shall
set forth (i) the name and address of the Limited Partner or Limited Partners
making the nomination or nominations, (ii) the number of Common Units
beneficially owned by such Limited Partner or Limited Partners, (iii) such
information regarding the nominee(s) proposed by the Limited Partner or Limited
Partners as would be required to be included in a proxy statement relating to
the solicitation of proxies for the election of directors filed pursuant to the
proxy rules of the Commission had the nominee(s) been nominated or intended to
be nominated to the Board of Directors, (iv) the written consent of each nominee
to serve as a member of the Board of Directors if so elected and (v) a
certification that such nominee(s) qualify as Elected
Directors.
Section
7.4 Removal of Members of Board
of Directors. Members of the Board of Directors
may only be removed as follows:
(a) Any
Appointed Director may be removed at any time, (i) without Cause, only by the
General Partner and, (ii) with Cause, by (x) the General Partner, (y) by the
affirmative vote of the holders of a majority of the Outstanding Units (other
than Subordinated Series A Units) at a properly called meeting of the Limited
Partners or (z) by the affirmative vote of a majority of the other members of
the Board of Directors.
(b) Any
and all of the Elected Directors may be removed at any time, with Cause, only by
the affirmative vote of a majority of the other members of the Board of
Directors or at a properly called meeting of the Limited Partners only by the
affirmative vote of the holders of a majority of the Outstanding Common
Units.
Section
7.5 Resignations of Members of
the Board of Directors. Any member of the Board of
Directors may resign at any time by giving written notice to the Board of
Directors. Such resignation shall take effect at the time specified
therein.
Section
7.6 Vacancies on the Board of
Directors. Vacancies on the Board of Directors may
be filled only as follows:
(a) If
any Appointed Director is removed, resigns or is otherwise unable to serve as a
member of the Board of Directors, the General Partner shall, in its sole
discretion, appoint an individual to fill the vacancy.
(b) If
any Elected Director is removed, resigns or is unable to serve as a member of
the Board of Directors, the vacancy shall be filled by a majority of the Elected
Directors then serving.
(c) A
director appointed or elected pursuant to this Section 7.6 to fill a vacancy
shall be appointed or elected, as the case may be, for no more than the
unexpired term of his or her predecessor in office.
Section
7.7 Meetings; Committees;
Chairman.
(a) Regular
meetings of the Board of Directors shall be held at such times and places as
shall be designated from time to time by resolution of the Board of Directors.
Notice of such regular meetings shall not be required. Special meetings of the
Board of Directors may be called by the Chairman of the Board of Directors and
shall be called by the Secretary upon the written request of two members of the
Board of Directors, on at least 48 hours prior written notice to the other
members. Any such notice, or waiver thereof, need not state the purpose of such
meeting except as may otherwise be required by law. Attendance of a member of
the Board of Directors at a meeting (including pursuant to the penultimate
sentence of this Section 7.7(a)) shall constitute a waiver of notice of such
meeting, except where such member attends the meeting for the express purpose of
objecting to the transaction of any business on the ground that the meeting is
not lawfully called or convened. Any action required or permitted to be taken at
a meeting of the Board of Directors may be taken without a meeting, without
prior notice and without a vote if a consent or consents in writing, setting
forth the action so taken, is signed by all the members of the Board of
Directors. Members of the Board of Directors may participate in and hold
meetings by means of conference telephone, videoconference or similar
communications equipment by means of which all Persons participating in the
meeting can hear each other, and participation in such meetings shall constitute
presence in person at the meeting. The Board of Directors may establish any
additional rules governing the conduct of its meetings that are not inconsistent
with the provisions of this Agreement.
(b) The
Board of Directors shall appoint the Audit Committee and the Conflicts Committee
to consist, in each case, solely of a minimum of three of the Elected Directors
then in office. The Audit Committee and the Conflicts Committee shall, in each
case, perform the functions delegated to it pursuant to the terms of this
Agreement and such other matters as may be delegated to it from time to time by
resolution of the Board of Directors. The Board of Directors, by a majority of
the whole Board of Directors, may appoint one or more additional committees of
the Board of Directors to consist of one or more members of the Board of
Directors, which committee(s) shall have and may exercise such of the powers and
authority of the Board of Directors (including in respect of Section 7.1)
with respect to the management of the business and affairs of the Partnership as
may be provided in a resolution of the Board of Directors. Any committee
designated pursuant to this Section 7.7(b) shall choose its own
chairman, shall keep regular minutes of its proceedings and report the same to
the Board of Directors when requested, shall fix its own rules or procedures and
shall meet at such times and at such place or places as may be provided by such
rules or by resolution of such committee or resolution of the Board of
Directors. At every meeting of any such committee, the presence of a majority of
all the members thereof shall constitute a quorum and the affirmative vote of a
majority of the members present shall be necessary for the taking of any action.
Subject to the first sentence of this Section 7.7(b), the Board of Directors may
designate one or more members of the Board of Directors as alternate members of
any committee who may replace any absent or disqualified member at any meeting
of such committee. Subject to the first sentence of this Section 7.7(b), in
the absence or disqualification of a member of a committee, the member or
members present at any meeting and not disqualified from voting, whether or not
constituting a quorum, may unanimously appoint another member of the Board of
Directors to act at the meeting in the place of the absent or disqualified
member.
(c) The
Appointed Directors may designate one of the members of the Board of Directors
as Chairman of the Board of Directors. The Chairman of the Board of Directors,
if any, and if present and acting, shall preside at all meetings of the Board of
Directors. In the absence of the Chairman of the Board of Directors, another
member of the Board of Directors chosen by the Appointed Directors shall
preside. If, at any time, in accordance with Section 7.2(b), the Board of
Directors consists solely of Elected Directors, the Board of Directors may elect
one of its members as Chairman of the Board of Directors and shall, in the
absence of the Chairman of the Board of Directors at a meeting of the Board of
Directors, choose another member of the Board of Directors to preside at the
meeting.
(a) The
Board of Directors, as set forth below, shall appoint agents of the Partnership,
referred to as “Officers” of the
Partnership as described in this Section 7.8. Unless provided otherwise by
resolution of the Board of Directors, the Officers shall have the titles, power,
authority and duties described below in this Section 7.8.
(b) The
Officers of the Partnership shall be the Chairman of the Board of Directors
(unless the Board of Directors provides otherwise), Executive Vice Chairman or
Vice Chairman of the Board of Directors (unless the Board of Directors provides
otherwise), the Chief Executive Officer, the President and any and all Vice
Presidents, the Secretary and any and all Assistant Secretaries and any
Treasurer and any and all Assistant Treasurers and any other Officers appointed
pursuant to Section 7.8(j). There shall be appointed from time to time, in
accordance with this Section 7.8, such Vice Presidents, Secretaries, Assistant
Secretaries, Treasurers and Assistant Treasurers as the Board of Directors may
desire. Any person may hold two or more offices.
(c) The
Officers shall be appointed by the Board of Directors at such time and for such
terms as the Board of Directors shall determine. Any Officer may be removed,
with or without Cause, only by the Board of Directors. Vacancies in any office
may be filled only by the Board of Directors.
(d) The
Board of Directors may elect one of its members as the Chairman of the Board of
Directors. Unless the Board of Directors provides otherwise, the Chairman of the
Board of Directors shall be an Officer of the Partnership and shall have the
powers, duties and authorities assigned by the Board of
Directors.
(e) The
Board of Directors may elect one of its members as Executive Vice Chairman or
Vice Chairman of the Board of Directors. Unless the Board of Directors provides
otherwise, the Executive Vice Chairman or Vice Chairman of the Board of
Directors, as the case may be, shall be an Officer of the Partnership and shall
have the powers, duties and authority of the chief executive officer of the
Partnership and, as such, shall be responsible for the general and active
management and direction of the Partnership and shall see that all orders and
resolutions of the Board of Directors are carried into
effect.
(f) Subject
to the limitations imposed by this Agreement, any employment agreement, any
employee plan or any determination of the Board of Directors, the Chief
Executive Officer, subject to the direction of the Board of Directors, shall
have the powers, duties and authority of the chief executive officer of the
Partnership and, as such, shall be responsible for the management of the
business and affairs of the Partnership, its other Officers, employees and
agents, shall supervise generally the affairs of the Partnership and shall have
full authority to execute all documents and take all actions that the
Partnership may legally take. The Chief Executive Officer shall exercise such
other powers and perform such other duties as may be assigned to him by this
Agreement or the Board of Directors, including any duties and powers stated in
any employment agreement approved by the Board of Directors.
(g) Subject
to the limitations imposed by this Agreement, any employment agreement, any
employee plan or any determination of the Board of Directors, the President,
subject to the direction of the Chief Executive Officer and the Board of
Directors, shall have the powers, duties and authority of the chief operating
officer of the Partnership and, as such, shall be responsible for the direction
of the day-to-day operations of the Partnership. In the absence of the Chief
Executive Officer, the President shall have all of the powers and duties
conferred upon the Chief Executive Officer, including the same power as the
Chief Executive Officer to execute documents on behalf of the Partnership. The
President shall exercise such other powers and perform such other duties as may
be assigned to him by the Chief Executive Officer, this Agreement, or the Board
of Directors, including any duties and powers stated in any employment agreement
approved by the Board of Directors.
(h) In
the absence of the President, each Vice President appointed by the Board of
Directors shall have all of the powers and duties conferred upon the President,
including the same power as the President to execute documents on behalf of the
Partnership. Each such Vice President shall perform such other duties and may
exercise such other powers as may from time to time be assigned to him by the
Board of Directors or the President.
(i) The
Secretary shall record or cause to be recorded in books provided for that
purpose the minutes of the meetings or actions of the Board of Directors and
Unitholders, shall see that all notices are duly given in accordance with the
provisions of this Agreement and as required by law, shall be custodian of all
records (other than financial), shall see that the books, reports, statements,
certificates and all other documents and records required by law are properly
kept and filed, and, in general, shall perform all duties incident to the office
of Secretary and such other duties as may, from time to time, be assigned to him
by this Agreement, the Board of Directors or the President. The Assistant
Secretaries shall exercise the powers of the Secretary during that Officer’s
absence or inability or refusal to act.
(j) The
Treasurer shall keep or cause to be kept the books of account of the Partnership
and shall render statements of the financial affairs of the Partnership in such
form and as often as required by this Agreement, the Board of Directors or the
President. The Treasurer, subject to the order of the Board of Directors, shall
have the custody of all funds and securities of the Partnership. The Treasurer
shall perform all other duties commonly incident to his or her office and shall
perform such other duties and have such other powers as this Agreement, the
Board of Directors or the President, shall designate from time to time. The
Assistant Treasurers shall exercise the power of the Treasurer during that
Officer’s absence or inability or refusal to act. Each of the Assistant
Treasurers shall possess the same power as the Treasurer to sign all
certificates, contracts, obligations and other instruments of the Partnership.
If no Treasurer or Assistant Treasurer is appointed and serving or in the
absence of the appointed Treasurer and Assistant Treasurer, the Vice President
and Chief Financial Officer, or such other Officer as the Board of Directors
shall select, shall have the powers and duties conferred upon the
Treasurer.
(k) The
Board of Directors may appoint such other Officers and agents as may from time
to time appear to be necessary or advisable in the conduct of the affairs of the
Partnership, who shall hold their offices for such terms and shall exercise such
powers and perform such duties as shall be determined from time to time by the
Board of Directors.
(l) The
Board of Directors may grant powers of attorney or other authority as
appropriate to establish and evidence the authority of the Officers and other
Persons.
(m) Unless
otherwise provided by resolution of the Board of Directors, no Officer shall
have the power or authority to delegate to any Person such Officer’s rights and
powers as an Officer to manage the business and affairs of the
Partnership.
Section
7.9 Compensation of
Directors. The members of the Board of Directors
who are not employees of the Partnership, the General Partner or its Affiliates
shall receive such compensation for their services as members of the Board of
Directors or members of a committee of the Board of Directors shall determine.
In addition, the members of the Board of Directors shall be entitled to be
reimbursed for out-of-pocket costs and expenses incurred in the course of their
service hereunder.
Section
7.10 Certificate of Limited
Partnership. The General Partner has caused the
Certificate of Limited Partnership to be filed with the Registrar of
Corporations of The Marshall Islands as required by the Marshall Islands Act.
The General Partner shall use all commercially reasonable efforts to cause to be
filed such other certificates or documents that the Board of Directors
determines to be necessary or appropriate for the formation, continuation,
qualification and operation of a limited partnership (or a partnership or other
entity in which the limited partners have limited liability) in The Marshall
Islands or any other jurisdiction in which the Partnership may elect to do
business or own property. To the extent the Board of Directors determines such
action to be necessary or appropriate, the General Partner shall file amendments
to and restatements of the Certificate of Limited Partnership and do all things
to maintain the Partnership as a limited partnership (or a partnership or other
entity in which the limited partners have limited liability) under the laws of
The Marshall Islands or of any other jurisdiction in which the Partnership may
elect to do business or own property. Subject to the terms of Section 3.4(a),
the General Partner shall not be required, before or after filing, to deliver or
mail a copy of the Certificate of Limited Partnership, any qualification
document or any amendment thereto to any Limited Partner.
Section
7.11 Restrictions on the
Authority of the Board of Directors and the General
Partner.
(a) Except
as otherwise provided in this Agreement, neither the Board of Directors nor the
General Partner may, without written approval of the specific act by holders of
all of the Outstanding Limited Partner Interests or by other written instrument
executed and delivered by holders of all of the Outstanding Limited Partner
Interests subsequent to the date of this Agreement, take any action in
contravention of this Agreement.
(b) Except
as provided in Articles XII and XIV, the Board of Directors may not sell,
exchange or otherwise dispose of all or substantially all of the assets of the
Partnership Group, taken as a whole, in a single transaction or a series of
related transactions (including by way of merger, consolidation, other
combination or sale of ownership interests in the Partnership’s Subsidiaries) or
dissolve the Partnership without the approval of holders of a Unit Majority and
the General Partner; provided, however, that this
provision shall not preclude or limit the ability of the Board of Directors to
mortgage, pledge, hypothecate or grant a security interest in all or
substantially all of the assets of the Partnership Group and shall not apply to
any forced sale of any or all of the assets of the Partnership Group pursuant to
the foreclosure of, or other realization upon, any such encumbrance. The
transfer of the General Partner Interest to and the election of a successor
general partner of the Partnership shall be made in accordance with Sections
4.6, 11.1 and 11.2.
Section
7.12 Reimbursement of the General
Partner.
(a) Except
as provided in this Section 7.12 and elsewhere in this Agreement, the General
Partner shall not be compensated for its services as a general partner or
managing member of any Group Member.
(b) The
General Partner shall be reimbursed on a monthly basis, or such other basis as
the Board of Directors may determine, for any direct and indirect expenses it
incurs that are allocable to the Partnership Group or payments it makes on
behalf of the Partnership Group (including salary, bonus, incentive compensation
and other amounts paid to any Person, including Affiliates of the General
Partner, to perform services for the Partnership or for the General Partner in
the discharge of its duties to the Partnership Group, which amounts shall also
include reimbursement for any Common Units purchased to satisfy obligations of
the Partnership under any of its equity compensation plans). The Board of
Directors shall determine the expenses that are allocable to the Partnership
Group. Reimbursements pursuant to this Section 7.12 shall be in addition to any
reimbursement to the General Partner as a result of indemnification pursuant to
Section 7.15.
(c) The
Board of Directors, without the approval of the Limited Partners (who shall have
no right to vote in respect thereof), may propose and adopt on behalf of the
Partnership employee benefit plans, employee programs and employee practices
(including plans, programs and practices involving the issuance of Partnership
Securities or options to purchase or rights, warrants or appreciation rights
relating to Partnership Securities), or cause the Partnership to issue
Partnership Securities in connection with, or pursuant to, any employee benefit
plan, employee program or employee practice maintained or sponsored by the
Partnership, the General Partner or any of its Affiliates, in each case for the
benefit of employees of the Partnership, the General Partner, any Group Member
or any Affiliate thereof, or any of them, in respect of services performed,
directly or indirectly, for the benefit of the Partnership Group. The
Partnership agrees to issue and sell to the General Partner or any of its
Affiliates any Partnership Securities that the General Partner or such
Affiliates are obligated to provide to any employees pursuant to any such
employee benefit plans, employee programs or employee practices. Expenses
incurred by the General Partner in connection with any such plans, programs and
practices (including the net cost to the General Partner or such Affiliates of
Partnership Securities purchased by the General Partner or such Affiliates from
the Partnership or in the open market to fulfill options or awards under such
plans, programs and practices) shall be reimbursed in accordance with Section
7.12(b). Any and all obligations of the General Partner under any employee
benefit plans, employee programs or employee practices adopted by the General
Partner as permitted by this Section 7.12(c) shall constitute obligations of the
General Partner hereunder and shall be assumed by any successor General Partner
approved pursuant to Sections 11.1 or 11.2 or the transferee of or successor to
all of the General Partner’s General Partner Interest pursuant to Section
4.6.
Section
7.13 Outside
Activities.
(a) After
the Closing Date, the General Partner, for so long as it is the General Partner
of the Partnership (i) agrees that its sole business will be to act as a general
partner or managing member, as the case may be, of the Partnership and any other
partnership or limited liability company of which the Partnership is, directly
or indirectly, a partner or member and to undertake activities that are
ancillary or related thereto (including being a limited partner in the
Partnership), (ii) shall not engage in any business or activity or incur any
debts or liabilities except in connection with or incidental to (A) its
performance as general partner or managing member, if any, of one or more Group
Members or as described in or contemplated by the Registration Statement or (B)
the acquiring, owning or disposing of debt or equity securities in any Group
Member and (iii) except to the extent permitted in the Omnibus Agreement, shall
not, acquire or own Panamax Carrier Assets or Capesize Carrier Assets (as such
terms are defined in the Omnibus Agreement).
(b) Navios
Maritime Holdings, the Partnership, the General Partner and the Operating
Company have entered into the Omnibus Agreement, which agreement sets forth
certain restrictions on the ability of Navios Maritime Holdings and certain of
its Affiliates to acquire or own Panamax Carrier Assets or Capesize Carrier
Assets (as such terms are defined in the Omnibus Agreement).
(c) Except
as specifically restricted by Section 7.13(a) or the Omnibus Agreement, each
Indemnitee (other than the General Partner) shall have the right to engage in
businesses of every type and description and other activities for profit and to
engage in and possess an interest in other business ventures of any and every
type or description, whether in businesses engaged in or anticipated to be
engaged in by any Group Member, independently or with others, including business
interests and activities in direct competition with the business and activities
of any Group Member, and none of the same shall constitute a breach of this
Agreement or any duty expressed or implied by law to any Group Member or any
Partner. Notwithstanding anything to the contrary in this Agreement, (i) the
possessing of competitive interests and engaging in competitive activities by
any Indemnitees (other than the General Partner) in accordance with the
provisions of this Section 7.13 is hereby approved by the Partnership and all
Partners and (ii) it shall be deemed not to be a breach of any fiduciary duty or
any other obligation of any type whatsoever of the General Partner or of any
Indemnitee for the Indemnitees (other than the General Partner) to engage in
such business interests and activities in preference to or to the exclusion of
the Partnership.
(d) Notwithstanding
anything to the contrary in this Agreement, the doctrine of corporate
opportunity, or any analogous doctrine, shall not apply to an Indemnitee
(including the General Partner) and, subject to the terms of Section 7.13(a),
Section 7.13(b), Section 7.13(c) and the Omnibus Agreement, no Indemnitee
(including the General Partner) who acquires knowledge of a potential
transaction, agreement, arrangement or other matter that may be an opportunity
for the Partnership shall have any duty to communicate or offer such opportunity
to the Partnership, and, subject to the terms of Section 7.13(a), Section
7.13(b), Section 7.13(c) and the Omnibus Agreement, such Indemnitee (including
the General Partner) shall not be liable to the Partnership, to any Limited
Partner or any other Person for breach of any fiduciary or other duty by reason
of the fact that such Indemnitee (including the General Partner) pursues or
acquires such opportunity for itself, directs such opportunity to another Person
or does not communicate such opportunity or information to the
Partnership.
(e) The
General Partner and each of its Affiliates may acquire Units or other
Partnership Securities in addition to those acquired on the Closing Date and,
except as otherwise provided in this Agreement, shall be entitled to exercise,
at their option, all rights relating to all Units or other Partnership
Securities acquired by them. The term “Affiliates” as used
in this Section 7.13(e) with respect to the General Partner shall not include
any Group Member.
Section
7.14 Loans from the General
Partner; Loans or Contributions from the Partnership or Group
Members.
(a) The
General Partner or any of its Affiliates may lend to and/or borrow from any
Group Member, and any Group Member may lend to and/or borrow from the General
Partner or any of its Affiliates, funds needed or desired by the Group Member
for such periods of time and in such amounts as the General Partner and the
Board of Directors may determine; provided, however, that in any
such case the lending party may not charge the borrowing party interest at a
rate greater than the rate that would be charged the borrowing party or impose
terms less favorable to the borrowing party than would be charged or imposed on
the borrowing party by unrelated lenders on comparable loans made on an
arms’-length basis (without reference to the lending party’s financial abilities
or guarantees), all as determined by the General Partner and the Board of
Directors. The borrowing party shall reimburse the lending party for any costs
(other than any additional interest costs) incurred by the lending party in
connection with the borrowing of such funds. For purposes of this Section
7.14(a) and Section 7.14(b), the term “Group Member” shall
include any Affiliate of a Group Member that is controlled by the Group
Member.
(b) The
Partnership may lend or contribute to any Group Member, and any Group Member may
borrow from the Partnership, funds on terms and conditions determined by the
Board of Directors.
(c) No
borrowing by any Group Member or the approval thereof by the General Partner or
the Board of Directors shall be deemed to constitute a breach of any duty,
expressed or implied, of the General Partner or its Affiliates or the Board of
Directors to the Partnership or the Limited Partners by reason of the fact that
the purpose or effect of such borrowing is directly or indirectly to (i) enable
distributions to the General Partner or its Affiliates (including in their
capacities as Limited Partners) to exceed the General Partner’s Percentage
Interest of the total amount distributed to all partners or (ii) hasten the
expiration of the Subordination Period or the conversion of any Subordinated
Units into Common Units.
Section
7.15 Indemnification.
(a) To
the fullest extent permitted by law but subject to the limitations expressly
provided in this Agreement, all Indemnitees shall be indemnified and held
harmless by the Partnership from and against any and all losses, claims,
damages, liabilities, joint or several, expenses (including legal fees and
expenses), judgments, fines, penalties, interest, settlements or other amounts
arising from any and all claims, demands, actions, suits or proceedings, whether
civil, criminal, administrative or investigative, in which any Indemnitee may be
involved, or is threatened to be involved, as a party or otherwise, by reason of
its status as an Indemnitee; provided, however, that the
Indemnitee shall not be indemnified and held harmless if there has been a final
and non-appealable judgment entered by a court of competent jurisdiction
determining that, in respect of the matter for which the Indemnitee is seeking
indemnification pursuant to this Section 7.15, the Indemnitee acted in bad faith
or engaged in fraud or willful misconduct or, in the case of a criminal matter,
acted with knowledge that the Indemnitee’s conduct was unlawful; and, provided further, that no
indemnification pursuant to this Section 7.15 shall be available to the General
Partner or its Affiliates (other than a Group Member) with respect to its or
their obligations incurred pursuant to the Purchase Agreement, the Omnibus
Agreement, the First Contribution Agreement or the Second Contribution Agreement
(other than obligations incurred by the General Partner on behalf of the
Partnership). Any indemnification pursuant to this Section 7.15 shall be made
out of the assets of the Partnership, it being agreed that the General Partner
shall not be personally liable for such indemnification and shall have no
obligation to contribute or loan any monies or property to the Partnership to
enable it to effectuate such indemnification.
(b) To
the fullest extent permitted by law, expenses (including legal fees and
expenses) incurred by an Indemnitee who is indemnified pursuant to Section
7.15(a) in defending any claim, demand, action, suit or proceeding shall, from
time to time, be advanced by the Partnership prior to a determination that the
Indemnitee is not entitled to be indemnified upon receipt by the Partnership of
any undertaking by or on behalf of the Indemnitee to repay such amount if it
shall be determined that the Indemnitee is not entitled to be indemnified as
authorized in this Section 7.15.
(c) The
indemnification provided by this Section 7.15 shall be in addition to any other
rights to which an Indemnitee may be entitled under any agreement, pursuant to
any vote of the holders of Outstanding Limited Partner Interests, as a matter of
law or otherwise, both as to actions in the Indemnitee’s capacity as an
Indemnitee and as to actions in any other capacity, and shall continue as to an
Indemnitee who has ceased to serve in such capacity and shall inure to the
benefit of the heirs, successors, assigns and administrators of the
Indemnitee.
(d) The
Partnership may purchase and maintain (or reimburse the General Partner or its
Affiliates for the cost of) insurance, on behalf of the Board of Directors and
the General Partner, its Affiliates and such other Persons as the Board of
Directors shall determine, against any liability that may be asserted against,
or expense that may be incurred by, such Person in connection with the
Partnership’s activities or such Person’s activities on behalf of the
Partnership, regardless of whether the Partnership would have the power to
indemnify such Person against such liability under the provisions of this
Agreement or law.
(e) For
purposes of this Section 7.15, the Partnership shall be deemed to have requested
an Indemnitee to serve as fiduciary of an employee benefit plan whenever the
performance by the Indemnitee of its duties to the Partnership also imposes
duties on, or otherwise involves services by, it to the plan or participants or
beneficiaries of the plan; excise taxes assessed on an Indemnitee with respect
to an employee benefit plan pursuant to applicable law shall constitute “fines”
within the meaning of Section 7.15(a); and action taken or omitted by the
Indemnitee with respect to any employee benefit plan in the performance of its
duties for a purpose reasonably believed by it to be in the best interest of the
participants and beneficiaries of the plan shall be deemed to be for a purpose
that is in the best interests of the Partnership.
(f) In
no event may an Indemnitee subject the Limited Partners to personal liability by
reason of the indemnification provisions set forth in this
Agreement.
(g) An
Indemnitee shall not be denied indemnification in whole or in part under this
Section 7.15 because the Indemnitee had an interest in the transaction with
respect to which the indemnification applies if the transaction was otherwise
permitted by the terms of this Agreement.
(h) The
provisions of this Section 7.15 are for the benefit of the Indemnitees, their
heirs, successors, assigns and administrators and shall not be deemed to create
any rights for the benefit of any other Persons.
(i) No
amendment, modification or repeal of this Section 7.15 or any provision hereof
shall in any manner terminate, reduce or impair the right of any past, present
or future Indemnitee to be indemnified by the Partnership, nor the obligations
of the Partnership to indemnify any such Indemnitee under and in accordance with
the provisions of this Section 7.15 as in effect immediately prior to such
amendment, modification or repeal with respect to claims arising from or
relating to matters occurring, in whole or in part, prior to such amendment,
modification or repeal, regardless of when such claims may arise or be
asserted.
Section
7.16 Liability of
Indemnitees.
(a) Notwithstanding
anything to the contrary set forth in this Agreement, no Indemnitee shall be
liable for monetary damages to the Partnership, the Limited Partners or any
other Persons who have acquired interests in the Partnership Securities, for
losses sustained or liabilities incurred as a result of any act or omission of
an Indemnitee unless there has been a final and non-appealable judgment entered
by a court of competent jurisdiction determining that, in respect of the matter
in question, the Indemnitee acted in bad faith or engaged in fraud or willful
misconduct or, in the case of a criminal matter, acted with knowledge that the
Indemnitee’s conduct was criminal.
(b) Subject
to their obligations and duties as members of the Board of Directors or the
General Partner, respectively, set forth in Section 7.1(a), members of the Board
of Directors and the General Partner may exercise any of the powers granted to
them and perform any of the duties imposed upon them hereunder either directly
or by or through its agents, and the members of the Board of Directors and the
General Partner shall not be responsible for any misconduct or negligence on the
part of any such agent appointed by the Board of Directors or the General
Partner in good faith.
(c) To
the extent that, at law or in equity, an Indemnitee has duties (including
fiduciary duties) and liabilities relating thereto to the Partnership or to the
Partners, the General Partner and any other Indemnitee acting in connection with
the Partnership’s business or affairs shall not be liable to the Partnership or
to any Partner for its good faith reliance on the provisions of this
Agreement.
(d) Any
amendment, modification or repeal of this Section 7.16 or any provision hereof
shall be prospective only and shall not in any way affect the limitations on the
liability of the Indemnitees under this Section 7.16 as in effect immediately
prior to such amendment, modification or repeal with respect to claims arising
from or relating to matters occurring, in whole or in part, prior to such
amendment, modification or repeal, regardless of when such claims may arise or
be asserted.
Section
7.17 Resolution of Conflicts of
Interest; Standards of Conduct and Modification of
Duties.
(a) Unless
otherwise expressly provided in this Agreement or any Group Member Agreement,
whenever a potential conflict of interest exists or arises between the General
Partner or any of its Affiliates, or any member of the Board of Directors, on
the one hand, and the Partnership, any Group Member or any Partner, on the
other, any resolution or course of action in respect of such conflict of
interest shall be permitted and deemed approved by all Partners, and shall not
constitute a breach of this Agreement, of any Group Member Agreement, of any
agreement contemplated herein or therein, or of any duty stated or implied by
law or equity, if the resolution or course of action in respect of such conflict
of interest is (i) approved by Special Approval, (ii) approved by the vote of a
majority of the Common Units (excluding Common Units owned by the General
Partner and its Affiliates), (iii) on terms no less favorable to the
Partnership than those generally being provided to or available from unrelated
third parties or (iv) fair and reasonable to the Partnership, taking into
account the totality of the relationships between the parties involved
(including other transactions that may be particularly favorable or advantageous
to the Partnership). The General Partner and the Board of Directors may but
shall not be required in connection with the resolution of such conflict of
interest to seek Special Approval of such resolution, and the General Partner or
the Board of Directors, as the case may be, may also adopt a resolution or
course of action that has not received Special Approval. If Special Approval is
not sought and the Board of Directors determines that the resolution or course
of action taken with respect to a conflict of interest satisfies either of the
standards set forth in clauses (iii) or (iv) above, then it shall be presumed
that, in making its decision the Board of Directors, acted in good faith, and in
any proceeding brought by any Limited Partner or by or on behalf of such Limited
Partner or any other Limited Partner or the Partnership challenging such
approval, the Person bringing or prosecuting such proceeding shall have the
burden of overcoming such presumption. Notwithstanding anything to the contrary
in this Agreement, the existence of the conflicts of interest described in the
Registration Statement are hereby approved by all Partners.
(b) Whenever
the General Partner makes a determination or takes or declines to take any other
action, or any of its Affiliates causes it to do so, in its capacity as the
general partner of the Partnership as opposed to in its individual capacity,
whether under this Agreement, any Group Member Agreement or any other agreement
contemplated hereby or otherwise, then, unless another express standard is
provided for in this Agreement, the General Partner, or such Affiliates causing
it to do so, shall make such determination or take or decline to take such other
action in good faith and shall not be subject to any other or different
standards imposed by this Agreement, any Group Member Agreement, any other
agreement contemplated hereby or under the Marshall Islands Act or any other
law, rule or regulation or at equity. In order for a determination or other
action to be in “good faith” for purposes of this Agreement, the Person or
Persons making such determination or taking or declining to take such other
action must reasonably believe that the determination or other action is in the
best interests of the Partnership, unless the context otherwise
requires.
(c) Whenever
the General Partner makes a determination or takes or declines to take any other
action, or any of its Affiliates causes it to do so, in its individual capacity
as opposed to in its capacity as the general partner of the Partnership, whether
under this Agreement, any Group Member Agreement or any other agreement
contemplated hereby or otherwise, then the General Partner, or such Affiliates
causing it to do so, are entitled to make such determination or to take or
decline to take such other action free of any fiduciary duty or obligation
whatsoever to the Partnership or any Limited Partner, and the General Partner,
or such Affiliates causing it to do so, shall not be required to act in good
faith or pursuant to any other standard imposed by this Agreement, any Group
Member Agreement, any other agreement contemplated hereby or under the Marshall
Islands Act or any other law, rule or regulation or at equity. By way of
illustration and not of limitation, whenever the phrase, “at the option of the
General Partner,” or some variation of that phrase, is used in this Agreement,
it indicates that the General Partner is acting in its individual capacity. For
the avoidance of doubt, whenever the General Partner votes or transfers its
Units, General Partner Interest or Incentive Distribution Rights, to the extent
permitted under this Agreement, or refrains from voting or transferring its
Units, General Partner Units or Incentive Distribution Rights, as appropriate,
it shall be acting in its individual capacity. The General Partner’s
organizational documents may provide that determinations to take or decline to
take any action in its individual, rather than representative, capacity may or
shall be determined by its members, if the General Partner is a limited
liability company, stockholders, if the General Partner is a corporation, or the
members or stockholders of the General Partner’s general partner, if the General
Partner is a limited partnership.
(d) Whenever
the Board of Directors makes a determination or takes or declines to take any
other action, whether under this Agreement, any Group Member Agreement or any
other agreement contemplated hereby or otherwise, then, unless another express
standard is provided for in this Agreement, the Board of Directors, shall make
such determination or take or decline to take such other action in good faith
and shall not be subject to any other or different standards imposed by this
Agreement, any Group Member Agreement, any other agreement contemplated hereby
or under the Marshall Islands Act or any other law, rule or regulation or at
equity. In order for a determination or other action to be in “good faith” for
purposes of this Agreement, the Person or Persons making such determination or
taking or declining to take such other action must reasonably believe that the
determination or other action is in the best interests of the Partnership,
unless the context otherwise requires.
(e) Notwithstanding
anything to the contrary in this Agreement, neither the Board of Directors nor
the General Partner and its Affiliates shall have a duty or obligation, express
or implied, to (i) sell or otherwise dispose of any asset of the Partnership
Group other than in the ordinary course of business or (ii) permit any Group
Member to use any facilities or assets of the General Partner and its
Affiliates, except as may be provided in contracts entered into from time to
time specifically dealing with such use. Any determination by the Board of
Directors or the General Partner or any of its Affiliates to enter into such
contracts shall, in each case, be at their option.
(f) Except
as expressly set forth in this Agreement, neither the General Partner nor the
Board of Directors or any other Indemnitee shall have any duties or liabilities,
including fiduciary duties, to the Partnership or any Limited Partner and the
provisions of this Agreement, to the extent that they restrict, eliminate or
otherwise modify the duties and liabilities, including fiduciary duties, of the
Board of Directors or the General Partner or any other Indemnitee otherwise
existing at law or in equity, are agreed by the Partners to replace such other
duties and liabilities of the Board of Directors or the General Partner or such
other Indemnitee.
(g) The
Unitholders hereby authorize the Board of Directors, on behalf of the
Partnership as a partner or member of a Group Member, to approve of actions by
the general partner or managing member of such Group Member similar to those
actions permitted to be taken by the Board of Directors pursuant to this Section
7.17.
Section
7.18 Other Matters Concerning the
General Partner and the Board of Directors.
(a) The
General Partner and the Board of Directors may rely and shall be protected in
acting or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, bond, debenture or
other paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties.
(b) The
General Partner and the Board of Directors may consult with legal counsel,
accountants, appraisers, management consultants, investment bankers and other
consultants and advisers selected by either of them, and any act taken or
omitted to be taken in reliance upon the advice or opinion (including an Opinion
of Counsel) of such Persons as to matters that the General Partner or the Board
of Directors reasonably believes to be within such Person’s professional or
expert competence shall be conclusively presumed to have been done or omitted in
good faith and in accordance with such advice or opinion.
(c) The
General Partner shall have the right, in respect of any of its powers or
obligations hereunder, to act through any of its duly authorized officers, a
duly appointed attorney or attorneys-in-fact or the duly authorized officers of
the Partnership.
Section
7.19 Purchase or Sale of
Partnership Securities. The Board of Directors may
cause the Partnership to purchase or otherwise acquire Partnership Securities;
provided, however, that the
Board of Directors may not cause any Group Member to purchase Subordinated Units
during the Subordination Period. As long as Partnership Securities are held by
any Group Member, such Partnership Securities shall not be considered
Outstanding for any purpose, except as otherwise provided herein. The General
Partner or any Affiliate of the General Partner may purchase or otherwise
acquire and sell or otherwise dispose of Partnership Securities for its own
account, subject to the provisions of Articles IV and X.
Section
7.20 Registration Rights of the
General Partner and its Affiliates.
(a) If
(i) the General Partner or any Affiliate of the General Partner (including for
purposes of this Section 7.20, any Person (including Angeliki Frangou) that is
an Affiliate of the General Partner at the date hereof notwithstanding that it
may later cease to be an Affiliate of the General Partner) holds Partnership
Securities that it desires to sell and (ii) Rule 144 of the Securities Act (or
any successor rule or regulation to Rule 144) or another exemption from
registration is not available to enable such holder of Partnership Securities
(the “Holder”)
to dispose of the number of Partnership Securities it desires to sell at the
time it desires to do so without registration under the Securities Act, then at
the option and upon the request of the Holder, the Partnership shall file with
the Commission as promptly as practicable after receiving such request, and use
its reasonable best efforts to cause to become effective and remain effective
for a period of not less than six months following its effective date or such
shorter period as shall terminate when all Partnership Securities covered by
such registration statement have been sold, a registration statement under the
Securities Act registering the offering and sale of the number of Partnership
Securities specified by the Holder; provided, however, that the
Partnership shall not be required to effect more than three registrations
pursuant to this Section 7.20(a); and, provided further, that if the
Conflicts Committee determines in good faith that the requested registration
would be materially detrimental to the Partnership and its Partners, then the
Partnership shall have the right to postpone such requested registration for a
period of not more than 90 days after receipt of the Holder’s request. The
Partnership shall use its reasonable best efforts to resolve any deferral with
respect to any such registration and/or filing. In connection with any
registration pursuant to this Section 7.20(a), the Partnership shall
(i) promptly prepare and file (A) such documents as may be necessary to
register or qualify the securities subject to such registration under the
securities laws of such states as the Holder shall reasonably request (provided, however, that no such
qualification shall be required in any jurisdiction where, as a result thereof,
the Partnership would become subject to general service of process or to
taxation or qualification to do business as a foreign corporation or partnership
doing business in such jurisdiction solely as a result of such registration),
and (B) such documents as may be necessary to apply for listing or to list the
Partnership Securities subject to such registration on such National Securities
Exchange as the Holder shall reasonably request, and (ii) do any and all other
acts and things that may be necessary or appropriate to enable the Holder to
consummate a public sale of such Partnership Securities in such states. Except
as set forth in Section 7.20(c), all costs and expenses of any such registration
and offering (other than the underwriting discounts and commissions) shall be
paid by the Partnership, without reimbursement by the Holder.
(b) If
the Partnership shall at any time propose to file a registration statement under
the Securities Act for an offering of Partnership Securities for cash (other
than an offering relating solely to an employee benefit plan), the Partnership
shall use all its reasonable best efforts to include such number or amount of
Partnership Securities held by any Holder in such registration statement as the
Holder shall request; provided, however, that the
Partnership is not required to make any effort or take any action to so include
the Partnership Securities of the Holder once the registration statement becomes
or is declared effective by the Commission, including any registration statement
providing for the offering from time to time of Partnership Securities pursuant
to Rule 415 of the Securities Act. If the proposed offering pursuant to this
Section 7.20(b) shall be an underwritten offering, then, in the event that the
managing underwriter or managing underwriters of such offering advise the
Partnership and the Holder in writing that in their opinion the inclusion of all
or some of the Holder’s Partnership Securities would adversely and materially
affect the pricing of the offering, the Partnership shall include in such
offering only that number or amount, if any, of Partnership Securities held by
the Holder that, in the opinion of the managing underwriter or managing
underwriters, will not so adversely and materially affect the offering. Except
as set forth in Section 7.20(c), all costs and expenses of any such registration
and offering (other than the underwriting discounts and commissions) shall be
paid by the Partnership, without reimbursement by the
Holder.
(c) If
underwriters are engaged in connection with any registration referred to in this
Section 7.20, the Partnership shall provide indemnification,
representations, covenants, opinions and other assurance to the underwriters in
form and substance reasonably satisfactory to such underwriters. Further, in
addition to and not in limitation of the Partnership’s obligation under Section
7.15, the Partnership shall, to the fullest extent permitted by law, indemnify
and hold harmless the Holder, its officers, directors and each Person who
controls the Holder (within the meaning of the Securities Act) and any agent
thereof (collectively, “Indemnified Persons”)
from and against any and all losses, claims, demands, actions, causes of action,
assessments, damages, liabilities (joint or several), costs and expenses
(including interest, penalties and reasonable attorneys’ fees and
disbursements), resulting to, imposed upon, or incurred by the Indemnified
Persons, directly or indirectly, under the Securities Act or otherwise
(hereinafter referred to in this Section 7.20(c) as a “claim” and in the
plural as “claims”) based upon,
arising out of or resulting from any untrue statement or alleged untrue
statement of any material fact contained in any registration statement under
which any Partnership Securities were registered under the Securities Act or any
state securities or Blue Sky laws, in any preliminary prospectus or issuer free
writing prospectus as defined in Rule 433 of the Securities Act (if used prior
to the effective date of such registration statement), or in any summary or
final prospectus or in any amendment or supplement thereto (if used during the
period the Partnership is required to keep the registration statement current),
or arising out of, based upon or resulting from the omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements made therein not misleading; provided, however, that the
Partnership shall not be liable to any Indemnified Person to the extent that any
such claim arises out of, is based upon or results from an untrue statement or
alleged untrue statement or omission or alleged omission made in such
registration statement, such preliminary, summary or final prospectus or such
amendment or supplement, in reliance upon and in conformity with written
information furnished to the Partnership by or on behalf of such Indemnified
Person specifically for use in the preparation thereof.
(d) The
provisions of Section 7.20(a) and Section 7.20(b) shall continue to be
applicable with respect to the General Partner (and any of the General Partner’s
Affiliates) after it ceases to be a general partner of the Partnership, during a
period of two years subsequent to the effective date of such cessation and for
so long thereafter as is required for the Holder to sell all of the Partnership
Securities with respect to which it has requested during such two-year period
inclusion in a registration statement otherwise filed or that a registration
statement be filed; provided, however, that the
Partnership shall not be required to file successive registration statements
covering the same Partnership Securities for which registration was demanded
during such two-year period. The provisions of Section 7.20(c) shall continue in
effect thereafter.
(e) The
rights to cause the Partnership to register Partnership Securities pursuant to
this Section 7.20 may be assigned (but only with all related obligations)
by a Holder to a transferee or assignee of such Partnership Securities, provided
(i) the Partnership is, within a reasonable time after such transfer, furnished
with written notice of the name and address of such transferee or assignee and
the Partnership Securities with respect to which such registration rights are
being assigned, and (ii) such transferee or assignee agrees in writing to
be bound by and subject to the terms set forth in this Section
7.20.
(f) Any
request to register Partnership Securities pursuant to this Section 7.20 shall
(i) specify the Partnership Securities intended to be offered and sold by the
Person making the request, (ii) express such Person’s present intent to
offer such Partnership Securities for distribution, (iii) describe the
nature or method of the proposed offer and sale of Partnership Securities, and
(iv) contain the undertaking of such Person to provide all such information and
materials and take all action as may be required in order to permit the
Partnership to comply with all applicable requirements in connection with the
registration of such Partnership Securities.
Section
7.21 Reliance by Third
Parties. Notwithstanding anything to the contrary
in this Agreement, any Person dealing with the Partnership shall be entitled to
assume that the Board of Directors, the General Partner and any Officer
authorized by the Board of Directors to act on behalf of and in the name of the
Partnership has full power and authority to encumber, sell or otherwise use in
any manner any and all assets of the Partnership and to enter into any
authorized contracts on behalf of the Partnership, and such Person shall be
entitled to deal with the Board of Directors, the General Partner or any such
Officer as if it were the Partnership’s sole party in interest, both legally and
beneficially. Each Limited Partner hereby waives any and all defenses or other
remedies that may be available against such Person to contest, negate or
disaffirm any action of the Board of Directors, the General Partner or any such
Officer in connection with any such dealing. In no event shall any Person
dealing with the Board of Directors, the General Partner or any such Officer or
its representatives be obligated to ascertain that the terms of this Agreement
have been complied with or to inquire into the necessity or expedience of any
act or action of the Board of Directors, the General Partner or any such Officer
or its representatives. Each and every certificate, document or other instrument
executed on behalf of the Partnership by the Board of Directors, the General
Partner, the Officers or representatives of the General Partner authorized by
the General Partner or the Board of Directors shall be conclusive evidence in
favor of any and every Person relying thereon or claiming thereunder that (a) at
the time of the execution and delivery of such certificate, document or
instrument, this Agreement was in full force and effect, (b) the Person
executing and delivering such certificate, document or instrument was duly
authorized and empowered to do so for and on behalf of the Partnership and (c)
such certificate, document or instrument was duly executed and delivered in
accordance with the terms and provisions of this Agreement and is binding upon
the Partnership.
BOOKS,
RECORDS, ACCOUNTING AND REPORTS
Section
8.1 Records and
Accounting. The Partnership shall keep or cause to
be kept at the principal office of the Partnership appropriate books and records
with respect to the Partnership’s business, including all books and records
necessary to provide to the Limited Partners any information required to be
provided pursuant to Section 3.4(a). Any books and records maintained by or on
behalf of the Partnership in the regular course of its business, including the
record of the Record Holders of Units or other Partnership Securities, books of
account and records of Partnership proceedings, may be kept on, or be in the
form of, computer disks, hard drives, punch cards, magnetic tape, photographs,
micrographics or any other information storage device; provided, however, that the
books and records so maintained are convertible into clearly legible written
form within a reasonable period of time. The books of the Partnership shall be
maintained, for financial reporting purposes, on an accrual basis in accordance
with U.S. GAAP.
Section
8.2 Fiscal
Year. The fiscal year of the Partnership shall be
a fiscal year ending December 31.
(a) As
soon as practicable, but in no event later than 120 days after the close of each
fiscal year of the Partnership, the Partnership shall cause to be mailed or made
available, by any reasonable means (including posting on the Partnership’s
website), to each Record Holder of a Unit as of a date selected by the Board of
Directors, an annual report containing financial statements of the Partnership
for such fiscal year of the Partnership, presented in accordance with U.S. GAAP,
including a balance sheet and statements of operations, Partnership equity and
cash flows, such statements to be audited by a firm of independent public
accountants selected by the Board of Directors.
(b) As
soon as practicable, but in no event later than 90 days after the close of each
Quarter except the last Quarter of each fiscal year, the Partnership shall cause
to be mailed or made available, by any reasonable means (including posting on
the Partnership’s website), to each Record Holder of a Unit, as of a date
selected by the Board of Directors, a report containing unaudited financial
statements of the Partnership and such other information as may be required by
applicable law, regulation or rule of any National Securities Exchange on which
the Units are listed or admitted to trading, or as the Board of Directors
determines to be necessary or appropriate.
Section
9.1 Tax Elections and
Information.
(a) The
Partnership has elected to be treated as an association taxable as a corporation
for United States federal income tax purposes. Except as otherwise provided
herein, the Board of Directors shall determine whether the Partnership should
make any other elections permitted by the Code.
(b) The
tax information reasonably required by Record Holders generally for United
States federal and state income tax reporting purposes with respect to a taxable
year shall be furnished to them within 90 days of the close of the calendar year
in which the Partnership’s taxable year ends.
(c) Each
Partner shall provide the Partnership with all information reasonably requested
by the Partnership to enable the Partnership to claim the exemption from U.S.
federal income tax under Section 883 of the Code.
Section
9.2 Withholding. Notwithstanding
any other provision of this Agreement, the Board of Directors is authorized to
take any action that may be required to cause the Partnership and other Group
Members to comply with any withholding requirements established under the Code
or any other U.S. federal, state or local or any non-U.S. law including pursuant
to Sections 1441, 1442 and 1445 of the Code. To the extent that the Partnership
is required or elects to withhold and pay over to any taxing authority any
amount resulting from the distribution of income to any Partner, the Board of
Directors may treat the amount withheld as a distribution of cash pursuant to
Section 6.1 in the amount of such withholding from such
Partner.
Section
9.3 Conduct of
Operations. The Board of Directors and the General
Partner shall use commercially reasonable efforts to conduct the business of the
Partnership and its Affiliates in a manner that does not require a holder of
Common Units to file a tax return in any jurisdiction with which the holder has
no contact other than through ownership of Common Units.
Section
10.1 Admission of Initial Limited
Partners. Upon the issuance by the Partnership of
Common Units, Subordinated Units and Incentive Distribution Rights to the
General Partner, Navios Maritime Holdings and the Underwriters as described in
Sections 5.2 and 5.3, the Board of Directors shall admit such parties to the
Partnership as Initial Limited Partners in respect of the Common Units,
Subordinated Units or Incentive Distribution Rights issued to
them.
Section
10.2 Admission of Additional
Limited Partners.
(a) By
acceptance of the transfer of any Limited Partner Interests in accordance with
Article IV or the acceptance of any Limited Partner Interests issued pursuant to
Article V or pursuant to a merger or consolidation pursuant to Article XIV, each
transferee of, or other such Person acquiring, a Limited Partner Interest
(including any nominee holder or an agent or representative acquiring such
Limited Partner Interests for the account of another Person) (i) shall be
admitted to the Partnership as a Limited Partner with respect to the Limited
Partner Interests so transferred or issued to such Person when any such
transfer, issuance or admission is reflected in the books and records of the
Partnership and such Limited Partner becomes the Record Holder of the Limited
Partner Interests so transferred, (ii) shall become bound by the terms of this
Agreement, (iii) represents that the transferee has the capacity, power and
authority to enter into this Agreement, (iv) grants the powers of attorney set
forth in this Agreement and (v) makes the consents and waivers contained in this
Agreement, all with or without execution of this Agreement by such Person. The
transfer of any Limited Partner Interests and the admission of any new Limited
Partner shall not constitute an amendment to this Agreement. A Person may become
a Limited Partner or Record Holder of a Limited Partner Interest without the
consent or approval of any of the Partners. A Person may not become a Limited
Partner until such Person acquires a Limited Partner Interest and such Person is
reflected in the books and records of the Partnership as the Record Holder of
such Limited Partner Interest.
(b) The
name and mailing address of each Limited Partner shall be listed on the books
and records of the Partnership maintained for such purpose by the Partnership or
the Transfer Agent. The General Partner shall update the books and records of
the Partnership from time to time as necessary to reflect accurately the
information therein (or shall cause the Transfer Agent to do so, as applicable).
A Limited Partner Interest may be represented by a Certificate, as provided in
Section 4.1 hereof.
(c) Any
transfer of a Limited Partner Interest shall not entitle the transferee to
receive distributions or to any other rights to which the transferor was
entitled until the transferee becomes a Limited Partner pursuant to Section
10.2(a).
Section
10.3 Admission of Successor
General Partner. A successor General Partner
approved pursuant to Sections 11.1 or 11.2 or the transferee of or successor to
all of the General Partner Interest (represented by General Partner Units)
pursuant to Section 4.6 who is proposed to be admitted as a successor General
Partner shall be admitted to the Partnership as the General Partner, effective
immediately prior to the withdrawal or removal of the predecessor or
transferring General Partner, pursuant to Sections 11.1 or 11.2 or the transfer
of the General Partner Interest (represented by General Partner Units) pursuant
to Section 4.6; provided, however, that no such
successor shall be admitted to the Partnership until compliance with the terms
of Section 4.6 has occurred and such successor has executed and delivered such
other documents or instruments as may be required to effect such admission. Any
such successor shall, subject to the terms hereof, carry on the business of the
members of the Partnership Group without dissolution.
Section
10.4 Amendment of Agreement and
Certificate of Limited Partnership. To effect the
admission to the Partnership of any Partner, the Board of Directors shall take
all steps necessary or appropriate under the Marshall Islands Act to amend the
records of the Partnership to reflect such admission and, if necessary, to
prepare as soon as practicable an amendment to this Agreement and, if required
by law, the Board of Directors shall prepare and file an amendment to the
Certificate of Limited Partnership and the Board of Directors may for this
purpose, among others, exercise the power of attorney granted to it pursuant to
Section 2.6.
WITHDRAWAL
OR REMOVAL OF PARTNERS
Section
11.1 Withdrawal of the General
Partner.
(a) The
General Partner shall be deemed to have withdrawn from the Partnership upon the
occurrence of any one of the following events (each such event herein referred
to as an “Event of
Withdrawal”):
(i) The
General Partner voluntarily withdraws from the Partnership by giving written
notice to the other Partners;
(ii) The
General Partner transfers all of its rights as General Partner pursuant to
Section 4.6;
(iii) The
General Partner is removed pursuant to Section 11.2;
(iv) The
General Partner (A) makes a general assignment for the benefit of creditors;
(B) files a voluntary petition in bankruptcy; (C) files a petition or
answer seeking for itself a liquidation, dissolution or similar relief (but not
a reorganization) under any law; (D) files an answer or other pleading admitting
or failing to contest the material allegations of a petition filed against the
General Partner in a proceeding of the type described in clauses (A), (B) or (C)
of this Section 11.1(a)(iv); or (E) 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;
(v) The
General Partner is adjudged bankrupt or insolvent, or has entered against it an
order for relief in any bankruptcy or insolvency proceeding;
(vi) (A)
in the event the General Partner is a corporation, the filing of a certificate
of dissolution, or its equivalent, for the corporation or the revocation of its
charter and the expiration of ninety (90) days after the date of notice to the
corporation of revocation without a reinstatement of its charter; (B) in the
event the General Partner is a partnership or a limited liability company, the
dissolution and commencement of winding up of the General Partner; (C) in
the event the General Partner is acting in such capacity by virtue of being a
trustee of a trust, the termination of the trust; (D) in the event the General
Partner is a natural person, his death or adjudication of incompetency; and (E)
otherwise in the event of the termination of the General
Partner.
If an
Event of Withdrawal specified in Sections 11.1(a)(iv), 11.1(a)(v) or
11.1(a)(vi)(A), 11.1(a)(vi)(B), 11.1(a)(vi)(C) or 11.1(a)(vi)(E) occurs, the
withdrawing General Partner shall give notice to the Limited Partners within 30
days after such occurrence. The Partners hereby agree that only the Events of
Withdrawal described in this Section 11.1 shall result in the withdrawal of the
General Partner from the Partnership.
(b) Withdrawal
of the General Partner from the Partnership upon the occurrence of an Event of
Withdrawal shall not constitute a breach of this Agreement under the following
circumstances:
(i) at
any time during the period beginning on the Closing Date and ending at
12:00 midnight, prevailing Eastern Time, on December 31, 2017,
the General Partner voluntarily withdraws by giving at least 90 days’ advance
notice of its intention to withdraw to the Limited Partners; provided, however, that prior
to the effective date of such withdrawal, the withdrawal is approved by
Unitholders holding at least a majority of the Outstanding Common Units
(excluding Common Units held by the General Partner and its Affiliates) and the
General Partner delivers to the Partnership an Opinion of Counsel (“Withdrawal Opinion of
Counsel”) that such withdrawal (following the selection of the successor
General Partner) would not result in the loss of the limited liability of any
Limited Partner or any Group Member;
(ii) at
any time after 12:00 midnight, prevailing Eastern Time, on
December 31, 2017, the General Partner voluntarily withdraws by giving
at least 90 days’ advance notice to the Unitholders, such withdrawal to take
effect on the date specified in such notice;
(iii) at
any time that the General Partner ceases to be the General Partner pursuant to
Section 11.1(a)(ii) or is removed pursuant to Section 11.2;
or
(iv) notwithstanding
clause (i) of this sentence, at any time that the General Partner voluntarily
withdraws by giving at least 90 days’ advance notice of its intention to
withdraw to the Limited Partners, such withdrawal to take effect on the date
specified in the notice, if at the time such notice is given one Person and its
Affiliates (other than the General Partner and its Affiliates) own beneficially
or of record or control at least 50% of the Outstanding Units. The withdrawal of
the General Partner from the Partnership upon the occurrence of an Event of
Withdrawal shall also constitute the withdrawal of the General Partner as
general partner or managing member, if any, to the extent applicable, of the
other Group Members. If the General Partner gives a notice of withdrawal
pursuant to Section 11.1(a)(i), the holders of a Unit Majority, may, prior to
the effective date of such withdrawal, elect a successor General Partner. The
Person so elected as successor General Partner shall automatically become the
successor general partner or managing member, to the extent applicable, of the
other Group Members of which the General Partner is a general partner or a
managing member. If, prior to the effective date of the General Partner’s
withdrawal, a successor is not selected by the Unitholders as provided herein
or, if applicable, the Partnership does not receive a Withdrawal Opinion of
Counsel, the Partnership shall be dissolved in accordance with Section 12.1. Any
successor General Partner elected in accordance with the terms of this Section
11.1 shall be subject to the provisions of Section 10.3.
Section
11.2 Removal of the General
Partner. The General Partner may be removed if
such removal is approved by the Unitholders holding at least 66 2/3% of the
Outstanding Units (including Units held by the General Partner and its
Affiliates, but not including Subordinated Series A Units), voting as a single
class. Any such action by such holders or the Board of Directors for removal of
the General Partner must also provide for the election of a successor General
Partner by the majority vote of the outstanding Common Units and Subordinated
Units, voting together as a single class. Such removal shall be effective
immediately following the admission of a successor General Partner pursuant to
Section 10.3. The removal of the General Partner shall also automatically
constitute the removal of the General Partner as general partner or managing
member, to the extent applicable, of the other Group Members of which the
General Partner is a general partner or a managing member. If a Person is
elected as a successor General Partner in accordance with the terms of this
Section 11.2, such Person shall, upon admission pursuant to Section 10.3,
automatically become a successor general partner or managing member, to the
extent applicable, of the other Group Members of which the General Partner is a
general partner or a managing member. The right of the holders of Outstanding
Units (not including holders of Subordinated Series A Units) to remove the
General Partner shall not exist or be exercised unless the Partnership has
received an Opinion of Counsel opining as to the matters covered by a Withdrawal
Opinion of Counsel. Any successor General Partner elected in accordance with the
terms of this Section 11.2 shall be subject to the provisions of Section
10.3.
Section
11.3 Interest of Departing
General Partner and Successor General Partner.
(a) In
the event of (i) withdrawal of the General Partner under circumstances where
such withdrawal does not violate this Agreement or (ii) removal of the General
Partner by the holders of Outstanding Units (not including Subordinated Series A
Units) under circumstances where Cause does not exist, if the successor General
Partner is elected in accordance with the terms of Sections 11.1 or 11.2, the
Departing General Partner shall have the option, exercisable prior to the
effective date of the departure of such Departing General Partner, to require
its successor to purchase its General Partner Interest (represented by General
Partner Units) and its general partner interest (or equivalent interest), if
any, in the other Group Members and all of the Incentive Distribution Rights
(collectively, the “Combined Interest”)
in exchange for an amount in cash equal to the fair market value of such
Combined Interest, such amount to be determined and payable as of the effective
date of its departure. If the General Partner is removed by the Unitholders (not
including holders of Subordinated Series A Units) under circumstances where
Cause exists or if the General Partner withdraws under circumstances where such
withdrawal violates this Agreement, and if a successor General Partner is
elected in accordance with the terms of Sections 11.1 or 11.2 (or if the
business of the Partnership is continued pursuant to Section 12.2 and the
successor General Partner is not the former General Partner), such successor
shall have the option, exercisable prior to the effective date of the departure
of such Departing General Partner (or, in the event the business of the
Partnership is continued, prior to the date the business of the Partnership is
continued), to purchase the Combined Interest for such fair market value of such
Combined Interest of the Departing General Partner. In either event, the
Departing General Partner shall be entitled to receive all reimbursements due
such Departing General Partner pursuant to Section 7.12, including any
employee-related liabilities (including severance liabilities), incurred in
connection with the termination of any employees employed by the Departing
General Partner for the benefit of the Partnership or the other Group
Members.
For
purposes of this Section 11.3(a), the fair market value of the Departing General
Partner’s Combined Interest shall be determined by agreement between the
Departing General Partner and its successor or, failing agreement within 30 days
after the effective date of such Departing General Partner’s departure, by an
independent investment banking firm or other independent expert selected by the
Departing General Partner and its successor, which, in turn, may rely on other
experts, and the determination of which shall be conclusive as to such matter.
If such parties cannot agree upon one independent investment banking firm or
other independent expert within 45 days after the effective date of such
departure, then the Departing General Partner shall designate an independent
investment banking firm or other independent expert, the Departing General
Partner’s successor shall designate an independent investment banking firm or
other independent expert, and such firms or experts shall mutually select a
third independent investment banking firm or independent expert, which third
independent investment banking firm or other independent expert shall determine
the fair market value of the Combined Interest of the Departing General Partner.
In making its determination, such third independent investment banking firm or
other independent expert may consider the then current trading price of Units on
any National Securities Exchange on which Units are then listed or admitted to
trading, the value of the Partnership’s assets, the rights and obligations of
the Departing General Partner and other factors it may deem
relevant.
(b) If
the Combined Interest is not purchased in the manner set forth in Section
11.3(a), the Departing General Partner (or its transferee) shall become a
Limited Partner and its Combined Interest shall be converted into Common Units
pursuant to a valuation made by an investment banking firm or other independent
expert selected pursuant to Section 11.3(a), without reduction in such
Partnership Interest (but subject to proportionate dilution by reason of the
admission of its successor). Any successor General Partner shall indemnify the
Departing General Partner (or its transferee) as to all debts and liabilities of
the Partnership arising on or after the date on which the Departing General
Partner (or its transferee) becomes a Limited Partner. For purposes of this
Agreement, conversion of the Combined Interest of the Departing General Partner
to Common Units will be characterized as if the Departing General Partner (or
its transferee) contributed its Combined Interest to the Partnership in exchange
for the newly issued Common Units.
(c) If
a successor General Partner is elected in accordance with the terms of Sections
11.1 or 11.2 (or if the Partnership is continued pursuant to Section 12.2 and
the successor General Partner is not the former General Partner) and the option
described in Section 11.3(a) is not exercised by the party entitled to do so,
the successor General Partner shall, at the effective date of its admission to
the Partnership, contribute to the Partnership cash in the amount equal to the
product of the Percentage Interest of the Departing General Partner and the Net
Agreed Value of the Partnership’s assets on such date. In such event, such
successor General Partner shall, subject to the following sentence, be entitled
to its Percentage Interest of all Partnership allocations and distributions to
which the Departing General Partner was entitled. In addition, the successor
General Partner shall cause this Agreement to be amended to reflect that, from
and after the date of such successor General Partner’s admission, the successor
General Partner’s interest in all Partnership distributions and allocations
shall be its Percentage Interest.
Section
11.4 Termination of Subordination
Period, Conversion of Subordinated Units and Subordinated Series A Units, and
Extinguishment of Cumulative Common Unit
Arrearages. Notwithstanding any provision of this
Agreement, if the General Partner is removed as general partner of the
Partnership under circumstances where Cause does not exist and no Units held by
the General Partner and its Affiliates are voted in favor of such removal, (i)
the Subordination Period will end and all Outstanding Subordinated Units will
immediately and automatically convert into Common Units on a one-for-one basis,
(ii) the Subordinated Series A Units will immediately and automatically convert
into Common Units on a one-for-one basis, (iii) all Cumulative Common Unit
Arrearages on the Common Units will be extinguished and (iv) the General Partner
will have the right to convert its General Partner Interest (represented by
General Partner Units) and its Incentive Distribution Rights into Common Units
or to receive cash in exchange therefor, as provided in Section
11.3.
Section
11.5 Withdrawal of Limited
Partners. No Limited Partner shall have any right
to withdraw from the Partnership; provided, however, that when a
transferee of a Limited Partner’s Limited Partner Interest becomes a Record
Holder of the Limited Partner Interest so transferred, such transferring Limited
Partner shall cease to be a Limited Partner with respect to the Limited Partner
Interest so transferred.
DISSOLUTION
AND LIQUIDATION
Section
12.1 Dissolution. The
Partnership shall not be dissolved by the admission of additional Limited
Partners or by the admission of a successor General Partner in accordance with
the terms of this Agreement. Upon the removal or withdrawal of the General
Partner, if a successor General Partner is elected pursuant to Sections 11.1 or
11.2, the Partnership shall not be dissolved and the Board of Directors shall
continue the business of the Partnership. The Partnership shall dissolve, and
(subject to Section 12.2) its affairs shall be wound up,
upon:
(a) an
election to dissolve the Partnership by the General Partner and our Board of
Directors that is approved by the holders of a Unit Majority;
(b) at
any time there are no Limited Partners, unless the Partnership is continued
without dissolution in accordance with the Marshall Islands
Act;
(c) the
entry of a decree of judicial dissolution of the Partnership pursuant to the
provisions of the Marshall Islands Act; or
(d) an
Event of Withdrawal of the General Partner as provided in Section 11.1(a) (other
than Section 11.1(a)(ii)), unless a successor is elected and an Opinion of
Counsel is received as provided in Sections 11.1(b) or 11.2 and such successor
is admitted to the Partnership pursuant to Section 10.3.
Section
12.2 Continuation of the Business
of the Partnership After Dissolution. Upon
(a) dissolution of the Partnership following an Event of Withdrawal caused
by the withdrawal or removal of the General Partner as provided in Sections
11.1(a)(i) or 11.1(a)(iii) and the failure of the Partners to select a successor
to such Departing General Partner pursuant to Sections 11.1 or 11.2, then within
90 days thereafter, or (b) dissolution of the Partnership upon an event
constituting an Event of Withdrawal as defined in Sections 11.1(a)(iv),
11.1(a)(v) or 11.1(a)(vi), then, to the maximum extent permitted by law, within
180 days thereafter, the holders of a Unit Majority may elect to continue the
business of the Partnership on the same terms and conditions set forth in this
Agreement by appointing as a successor General Partner a Person approved by the
holders of a Unit Majority. Unless such an election is made within the
applicable time period as set forth above, the Partnership shall conduct only
activities necessary to wind up its affairs. If such an election is so made,
then:
(i) the
Partnership shall continue without dissolution unless earlier dissolved in
accordance with this Article XII;
(ii) if
the successor General Partner is not the former General Partner, then the
interest of the former General Partner shall be treated in the manner provided
in Section 11.3; and
(iii) the
successor General Partner shall be admitted to the Partnership as General
Partner, effective as of the Event of Withdrawal, by agreeing in writing to be
bound by this Agreement; provided, however, that the
right of the holders of a Unit Majority to approve a successor General Partner
and to reconstitute and to continue the business of the Partnership shall not
exist and may not be exercised unless the Partnership has received an Opinion of
Counsel that the exercise of the right would not result in the loss of limited
liability of any Limited Partner.
Section
12.3 Liquidator. Upon
dissolution of the Partnership, unless the business of the Partnership is
continued pursuant to Section 12.2, the Board of Directors shall select one or
more Persons to act as Liquidator. The Liquidator (if other than the General
Partner) shall be entitled to receive such compensation for its services as may
be approved by holders of at least a majority of the Outstanding Common Units
and Subordinated Units voting as a single class. The Liquidator (if other than
the General Partner) shall agree not to resign at any time without 15 days’
prior notice and may be removed at any time, with or without cause, by notice of
removal approved by holders of at least a majority of the Outstanding Common
Units and the Subordinated Units voting as a single class. Upon dissolution,
removal or resignation of the Liquidator, a successor and substitute Liquidator
(who shall have and succeed to all rights, powers and duties of the original
Liquidator) shall within 30 days thereafter be approved by the holders of at
least a majority of the Outstanding Common Units and Subordinated Units voting
as a single class. The right to approve a successor or substitute Liquidator in
the manner provided herein shall be deemed to refer also to any such successor
or substitute Liquidator approved in the manner herein provided. Except as
expressly provided in this Article XII, the Liquidator approved in the manner
provided herein shall have and may exercise, without further authorization or
consent of any of the parties hereto, all of the powers conferred upon the Board
of Directors and the General Partner under the terms of this Agreement (but
subject to all of the applicable limitations, contractual and otherwise, upon
the exercise of such powers, other than the limitation on sale set forth in
Section 7.11(b)) necessary or appropriate to carry out the duties and functions
of the Liquidator hereunder for and during the period of time required to
complete the winding up and liquidation of the Partnership as provided for
herein.
Section
12.4 Liquidation. The
Liquidator shall proceed to dispose of the assets of the Partnership, discharge
its liabilities, and otherwise wind up its affairs in such manner and over such
period as determined by the Liquidator, subject to Section 60 of the Marshall
Islands Act and the following:
(a) The
assets may be disposed of by public or private sale or by distribution in kind
to one or more Partners on such terms as the Liquidator and such Partner or
Partners may agree. If any property is distributed in kind, the Partner
receiving the property shall be deemed for purposes of Section 12.4(c) to have
received cash equal to its fair market value, and contemporaneously therewith,
appropriate cash distributions must be made to the other Partners. The
Liquidator may defer liquidation or distribution of the Partnership’s assets for
a reasonable time if it determines that an immediate sale or distribution of all
or some of the Partnership’s assets would be impractical or would cause undue
loss to the Partners. The Liquidator may distribute the Partnership’s assets, in
whole or in part, in kind if it determines that a sale would be impractical or
would cause undue loss to the Partners.
(b) Liabilities
of the Partnership include amounts owed to the Liquidator as compensation for
serving in such capacity (subject to the terms of Section 12.3) and amounts to
Partners otherwise than in respect of their distribution rights under Article
VI. With respect to any liability that is contingent, conditional or unmatured
or is otherwise not yet due and payable, the Liquidator shall either settle such
claim for such amount as it thinks appropriate or establish a reserve of cash or
other assets to provide for its payment. When paid, any unused portion of the
reserve shall be distributed as additional liquidation
proceeds.
(c) All
property and all cash in excess of that required to discharge liabilities as
provided in Section 12.4(b) shall be distributed as follows:
(i) If
the Current Market Price of the Common Units as of the date three trading days
prior to the announcement of the proposed liquidation exceeds the Unrecovered
Capital for a Common Unit plus the Cumulative Common Unit
Arrearage:
(A) First,
(x) to the General Partner in accordance with its Percentage Interest
and (y) to all the Unitholders holding Common Units, Pro Rata, a percentage
equal to 100% less the General Partner’s Percentage Interest, until there has
been distributed in respect of each Common Unit then Outstanding an amount equal
to such Current Market Price of a Common Unit;
(B) Second
(x) to the General Partner in accordance with its Percentage Interest and (y) to
all Unitholders holding Subordinated Units, Pro Rata, a percentage equal to 100%
less the General Partner’s Percentage Interest, until there has been distributed
in respect of each Subordinated Unit and each Subordinated Series A Unit then
Outstanding an amount equal to such Current Market Price of a Common Unit;
and
(C) Thereafter
(x) to the General Partner in accordance with its Percentage Interest; (y) 48%
to the holders of the Incentive Distribution Rights, Pro Rata; and (z) to all
Unitholders, Pro Rata, a percentage equal to 100% less the sum of the
percentages applicable to subclauses (x) and (y) of this clause
(i)(C);
(ii) If
the Current Market Price of the Common Units as of the date three trading days
prior to the announcement of the proposed liquidation is equal to or less than
the Unrecovered Capital for a Common Unit plus the Cumulative Common Unit
Arrearage:
(A) First,
(x) to the General Partner in accordance with its Percentage Interest and
(y) to all the Unitholders holding Common Units, Pro Rata, a percentage
equal to 100% less the General Partner’s Percentage Interest, until there has
been distributed in respect of each Common Unit then Outstanding an amount equal
to the Unrecovered Capital for a Common Unit;
(B) Second,
(x) to the General Partner in accordance with its Percentage Interest and (y) to
all Unitholders holding Common Units, Pro Rata, a percentage equal to 100% less
the General Partner’s Percentage Interest, until there has been distributed in
respect of each Common Unit then Outstanding an amount equal to the Cumulative
Common Unit Arrearage;
(C) Third,
(x) to the General Partner in accordance with its Percentage Interest and (y) to
all Unitholders holding Subordinated Units and Subordinated Series A Units, Pro
Rata, a percentage equal to 100% less the General Partner’s Percentage Interest,
until there has been distributed in respect of each Subordinated Unit and
Subordinated Series A Unit then Outstanding an amount equal to the Unrecovered
Capital for a Common Unit (as calculated prior to the distribution specified in
clause (ii)(A) above); and
(D) Thereafter,
(x) to the General Partner in accordance with its Percentage Interest; (y) 48%
to the holders of the Incentive Distribution Rights, Pro Rata; and (z) to all
Unitholders, Pro Rata, a percentage equal to 100% less the sum of the
percentages applicable to subclauses (x) and (y) of this clause
(ii)(D);
Section
12.5 Cancellation of Certificate
of Limited Partnership. Upon the completion of the
distribution of Partnership cash and property as provided in Section 12.4 in
connection with the liquidation of the Partnership, the Certificate of Limited
Partnership and all qualifications of the Partnership as a foreign limited
partnership in jurisdictions other than the Marshall Islands shall be canceled
and such other actions as may be necessary to terminate the Partnership shall be
taken.
Section
12.6 Return of
Contributions. The General Partner shall not be
personally liable for, and shall have no obligation to contribute or loan any
monies or property to the Partnership to enable it to effectuate, the return of
the Capital Contributions of the Limited Partners or Unitholders, or any portion
thereof, it being expressly understood that any such return shall be made solely
from Partnership assets.
Section
12.7 Waiver of
Partition. To the maximum extent permitted by law,
each Partner hereby waives any right to partition of the Partnership
property.
AMENDMENT
OF PARTNERSHIP AGREEMENT; MEETINGS; RECORD DATE
Section
13.1 Amendments to be Adopted
Without Approval of the Limited Partners or the General
Partner. The General Partner and each Limited
Partner agree that the Board of Directors, without the approval of any Limited
Partner or, subject to Section 5.5, the General Partner, may amend any provision
of this Agreement and execute, swear to, acknowledge, deliver, file and record
whatever documents may be required in connection therewith, to
reflect:
(a) a
change in the name of the Partnership, the location of the principal place of
business of the Partnership, the registered agent of the Partnership or the
registered office of the Partnership;
(b) admission,
substitution, withdrawal or removal of Partners in accordance with this
Agreement;
(c) a
change that the Board of Directors determines to be necessary or appropriate to
qualify or continue the qualification of the Partnership as a limited
partnership or a partnership in which the Limited Partners have limited
liability under the laws of The Marshall Islands;
(d) a
change that the Board of Directors determines (i) does not adversely affect the
Limited Partners (including any particular class of Partnership Interests as
compared to other classes of Partnership Interests) in any material respect,
(ii) to be necessary or appropriate to (A) satisfy any requirements, conditions
or guidelines contained in any opinion, directive, order, ruling or regulation
of any Marshall Islands authority (including the Marshall Islands Act) or (B)
facilitate the trading of the Units or comply with any rule, regulation,
guideline or requirement of any National Securities Exchange on which the Units
are or will be listed, (iii) to be necessary or appropriate in connection with
action taken by the Board of Directors pursuant to Section 5.10 or (iv) is
required to effect the intent expressed in the Registration Statement or the
intent of the provisions of this Agreement or is otherwise contemplated by this
Agreement;
(e) a
change in the fiscal year or taxable year of the Partnership and any other
changes that the Board of Directors determines to be necessary or appropriate as
a result of a change in the fiscal year or taxable year of the Partnership
including, if the Board of Directors shall so determine, a change in the
definition of “Quarter” and the dates on which distributions are to be made by
the Partnership;
(f) an
amendment that is necessary, in the Opinion of Counsel, to prevent the
Partnership, the members of the Board of Directors, or the General Partner or
its or their directors, officers, trustees or agents from in any manner being
subjected to the provisions of the U.S. Investment Company Act of 1940, as
amended, the U.S. Investment Advisers Act of 1940, as amended, or “plan asset”
regulations adopted under the U.S. Employee Retirement Income Security Act of
1974, as amended, regardless of whether such regulations are substantially
similar to plan asset regulations currently applied or proposed by the United
States Department of Labor;
(g) an
amendment that the Board of Directors, and if required by Section 5.5, the
General Partner, determines to be necessary or appropriate in connection with
the authorization of issuance of any class or series of Partnership Securities
pursuant to Section 5.5;
(h) any
amendment expressly permitted in this Agreement to be made by the Board of
Directors acting alone;
(i) an
amendment effected, necessitated or contemplated by a Merger Agreement approved
in accordance with Section 14.3;
(j) an
amendment that the Board of Directors determines to be necessary or appropriate
to reflect and account for the formation by the Partnership of, or investment by
the Partnership in, any corporation, partnership, joint venture, limited
liability company or other Person, in connection with the conduct by the
Partnership of activities permitted by the terms of Section
2.4;
(k) a
conversion, merger or conveyance pursuant to Section 14.3(d);
or
(l) any
other amendments substantially similar to the foregoing.
Section
13.2 Amendment
Procedures. Except as provided in Sections 13.1
and 13.3, all amendments to this Agreement shall be made in accordance with the
following requirements. Amendments to this Agreement may be proposed only by, or
with the written consent of, the Board of Directors; provided, however, that the
Board of Directors shall have no duty or obligation to propose any amendment to
this Agreement and may decline to do so free of any fiduciary duty or obligation
whatsoever to the Partnership or any Limited Partner and, in declining to
propose an amendment, to the fullest extent permitted by applicable law shall
not be required to act in good faith or pursuant to any other standard imposed
by this Agreement, any Group Member Agreement, any other agreement contemplated
hereby or under the Marshall Islands Act or any other law, rule or regulation. A
proposed amendment shall be effective upon its approval by the Board of
Directors and the holders of a Unit Majority, unless a greater or different
percentage is required under this Agreement or by the Marshall Islands Act. Each
proposed amendment that requires the approval of the holders of a specified
percentage of Outstanding Units shall be set forth in a writing that contains
the text of the proposed amendment. If such an amendment is proposed, the Board
of Directors shall seek the written approval of the requisite percentage of
Outstanding Units or call a meeting of the Unitholders to consider and vote on
such proposed amendment. The Board of Directors shall notify all Record Holders
upon final adoption of any such proposed amendments.
Section
13.3 Amendment
Requirements.
(a) Notwithstanding
the provisions of Sections 13.1 and 13.2, no provision of this Agreement that
establishes a percentage of Outstanding Units (including Units deemed owned by
the General Partner or its Affiliates) required to take any action shall be
amended, altered, changed, repealed or rescinded in any respect that would have
the effect of reducing such voting percentage unless such amendment is approved
by the written consent or the affirmative vote of holders of Outstanding Units
whose aggregate Outstanding Units constitute not less than the voting
requirement sought to be reduced.
(b) Notwithstanding
the provisions of Sections 13.1 and 13.2, no amendment to this Agreement may (i)
enlarge the obligations of any Limited Partner without its consent, unless such
enlargement shall be deemed to have occurred as a result of an amendment
approved pursuant to Section 13.3(c), (ii) enlarge the obligations of, restrict
in any way any action by or rights of, or reduce in any way the amounts
distributable, reimbursable or otherwise payable to, the General Partner or any
of its Affiliates without its consent, which consent may be given or withheld at
the General Partner’s option, (iii) change Section 12.1(a), or (iv) change the
term of the Partnership or, except as set forth in Section 12.1(a), give any
Person the right to dissolve the Partnership.
(c) Except
as provided in Section 14.3, and without limitation of the Board of Directors’
authority to adopt amendments to this Agreement without the approval of any
Limited Partners as contemplated in Section 13.1, any amendment that would have
a material adverse effect on the rights or preferences of any class of
Partnership Interests in relation to other classes of Partnership Interests must
be approved by the holders of not less than a majority of the Outstanding
Partnership Interests of the class affected.
(d) Notwithstanding
any other provision of this Agreement, except for amendments pursuant to Section
13.1 and except as otherwise provided by Section 14.3(b), no amendments shall
become effective without the approval of the holders of at least 90% of the
Outstanding Units voting as a single class unless the Partnership obtains an
Opinion of Counsel to the effect that such amendment will not affect the limited
liability of any Limited Partner under applicable law.
(e) Except
as provided in Section 13.1, this Section 13.3 shall only be amended with the
approval of the holders of at least 90% of the Outstanding
Units.
Section
13.4 Special
Meetings. All acts of Limited Partners to be taken
pursuant to this Agreement shall be taken in the manner provided in this Article
XIII. Special meetings of the Limited Partners may be called by the General
Partner, the Board of Directors or by Limited Partners owning 20% or more of the
Outstanding Units of the class or classes for which a meeting is proposed.
Limited Partners shall call a special meeting by delivering to the Board of
Directors one or more requests in writing stating that the signing Limited
Partners wish to call a special meeting and indicating the general or specific
purposes for which the special meeting is to be called, it being understood that
the purposes of such special meeting may only be to vote on matters that require
the vote of the Unitholders pursuant to this Agreement. Within 60 days after
receipt of such a call from Limited Partners or within such greater time as may
be reasonably necessary for the Partnership to comply with any statutes, rules,
regulations, listing agreements or similar requirements governing the holding of
a meeting or the solicitation of proxies for use at such a meeting, the Board of
Directors shall send a notice of the meeting to the Limited Partners either
directly or indirectly through the Transfer Agent. A meeting shall be held at a
time and place determined by the Board of Directors on a date not less than 10
days nor more than 60 days after the mailing of notice of the meeting. Limited
Partners shall not vote on matters that would cause the Limited Partners to be
deemed to be taking part in the management and control of the business and
affairs of the Partnership so as to jeopardize the Limited Partners’ limited
liability under the Marshall Islands Act or the law of any other jurisdiction in
which the Partnership is qualified to do business.
Section
13.5 Notice of a
Meeting. Notice of a meeting called pursuant to
Section 13.4 shall be given to the Record Holders of the class or classes of
Units for which a meeting is proposed in writing by mail or other means of
written communication in accordance with Section 16.1. The notice shall be
deemed to have been given at the time when deposited in the mail or sent by
other means of written communication.
Section
13.6 Record
Date. For purposes of determining the Limited
Partners entitled to notice of or to vote at a meeting of the Limited Partners
or to give approvals without a meeting as provided in Section 13.11, the Board
of Directors may set a Record Date, which shall not be less than 10 nor more
than 60 days before (a) the date of the meeting (unless such requirement
conflicts with any rule, regulation, guideline or requirement of any National
Securities Exchange on which the Units are listed or admitted to trading, in
which case the rule, regulation, guideline or requirement of such National
Securities Exchange shall govern) or (b) in the event that approvals are sought
without a meeting, the date by which Limited Partners are requested in writing
by the Board of Directors to give such approvals. If the Board of Directors does
not set a Record Date, then (a) the Record Date for determining the Limited
Partners entitled to notice of or to vote at a meeting of the Limited Partners
shall be the close of business on the day next preceding the day on which notice
is given, and (b) the Record Date for determining the Limited Partners entitled
to give approvals without a meeting shall be the date the first written approval
is deposited with the Partnership in care of the Board of Directors in
accordance with Section 13.11.
Section
13.7 Adjournment. When
a meeting is adjourned to another time or place, notice need not be given of the
adjourned meeting and a new Record Date need not be fixed, if the time and place
thereof are announced at the meeting at which the adjournment is taken, unless
such adjournment shall be for more than 45 days. At the adjourned meeting, the
Partnership may transact any business which might have been transacted at the
original meeting. If the adjournment is for more than 45 days or if a new Record
Date is fixed for the adjourned meeting, a notice of the adjourned meeting shall
be given in accordance with this Article XIII.
Section
13.8 Waiver of Notice; Approval
of Meeting; Approval of Minutes. The transactions
of any meeting of Limited Partners, however called and noticed, and whenever
held, shall be as valid as if it had occurred at a meeting duly held after
regular call and notice, if a quorum is present either in person or by proxy.
Attendance of a Limited Partner at a meeting shall constitute a waiver of notice
of the meeting, except when the Limited Partner attends the meeting for the
express purpose of objecting, at the beginning of the meeting, to the
transaction of any business because the meeting is not lawfully called or
convened; and except that attendance at a meeting is not a waiver of any right
to disapprove the consideration of matters required to be included in the notice
of the meeting, but not so included, if the disapproval is expressly made at the
meeting.
Section
13.9 Quorum and
Voting. The holders of a majority of the
Outstanding Units of the class or classes for which a meeting has been called
(including Outstanding Units deemed owned by the General Partner) represented in
person or by proxy shall constitute a quorum at a meeting of Limited Partners of
such class or classes unless any such action by the Limited Partners requires
approval by holders of a greater percentage of such Units, in which case the
quorum shall be such greater percentage. At any meeting of the Limited Partners
duly called and held in accordance with this Agreement at which a quorum is
present, the act of Limited Partners holding Outstanding Units that in the
aggregate represent a majority of the Outstanding Units entitled to vote and be
present in person or by proxy at such meeting shall be deemed to constitute the
act of all Limited Partners, unless a greater or different percentage is
required with respect to such action under the provisions of this Agreement, in
which case the act of the Limited Partners holding Outstanding Units that in the
aggregate represent at least such greater or different percentage shall be
required. The Limited Partners present at a duly called or held meeting at which
a quorum is present may continue to transact business until adjournment,
notwithstanding the withdrawal of enough Limited Partners to leave less than a
quorum, if any action taken (other than adjournment) is approved by the required
percentage of Outstanding Units specified in this Agreement (including
Outstanding Units deemed owned by the General Partner). In the absence of a
quorum, any meeting of Limited Partners may be adjourned from time to time by
the affirmative vote of holders of at least a majority of the Outstanding Units
entitled to vote at such meeting (including Outstanding Units deemed owned by
the General Partner) represented either in person or by proxy, but no other
business may be transacted, except as provided in Section
13.7.
Section
13.10 Conduct of a
Meeting. The Board of Directors shall have full
power and authority concerning the manner of conducting any meeting of the
Limited Partners or solicitation of approvals in writing, including the
determination of Persons entitled to vote, the existence of a quorum, the
satisfaction of the requirements of Section 13.4, the conduct of voting, the
validity and effect of any proxies and the determination of any controversies,
votes or challenges arising in connection with or during the meeting or voting.
The Chairman of the Board of Directors shall serve as chairman of any meeting
and shall further designate a Person to take the minutes of any meeting. All
minutes shall be kept with the records of the Partnership maintained by the
Board of Directors. The Board of Directors may make such other regulations
consistent with applicable law and this Agreement as it may deem advisable
concerning the conduct of any meeting of the Limited Partners or solicitation of
approvals in writing, including regulations in regard to the appointment of
proxies, the appointment and duties of inspectors of votes and approvals, the
submission and examination of proxies and other evidence of the right to vote,
and the revocation of approvals in writing.
Section
13.11 Action Without a
Meeting. If authorized by the Board of Directors,
any action that may be taken at a meeting of the Limited Partners may be taken
without a meeting if an approval in writing setting forth the action so taken is
signed by Limited Partners owning not less than the minimum percentage of the
Outstanding Units (including Units deemed owned by the General Partner) that
would be necessary to authorize or take such action at a meeting at which all
the Limited Partners were present and voted (unless such provision conflicts
with any rule, regulation, guideline or requirement of any National Securities
Exchange on which the Units are listed or admitted to trading, in which case the
rule, regulation, guideline or requirement of such National Securities Exchange
shall govern). Prompt notice of the taking of action without a meeting shall be
given to the Limited Partners who have not approved the action in writing. The
Board of Directors may specify that any written ballot submitted to Limited
Partners for the purpose of taking any action without a meeting shall be
returned to the Partnership within the time period, which shall be not less than
20 days, specified by the Board of Directors. If a ballot returned to the
Partnership does not vote all of the Units held by the Limited Partners, the
Partnership shall be deemed to have failed to receive a ballot for the Units
that were not voted. If approval of the taking of any action by the Limited
Partners is solicited by any Person other than by or on behalf of the Board of
Directors, the written approvals shall have no force and effect unless and until
(a) they are deposited with the Partnership in care of the Board of Directors,
(b) approvals sufficient to take the action proposed are dated as of a date not
more than 90 days prior to the date sufficient approvals are deposited with the
Partnership and (c) an Opinion of Counsel is delivered to the Board of Directors
to the effect that the exercise of such right and the action proposed to be
taken with respect to any particular matter (i) will not cause the Limited
Partners to be deemed to be taking part in the management and control of the
business and affairs of the Partnership so as to jeopardize the Limited
Partners’ limited liability, and (ii) is otherwise permissible under the
applicable statutes then governing the rights, duties and liabilities of the
Partnership and the Partners.
Section
13.12 Right to Vote and Related
Matters.
(a) Only
those Record Holders of the Units on the Record Date set pursuant to Section
13.6 (and also subject to the limitations contained in the definition of “Outstanding”) shall
be entitled to notice of, and to vote at, a meeting of Limited Partners or to
act with respect to matters as to which the holders of the Outstanding Units
have the right to vote or to act. All references in this Agreement to votes of,
or other acts that may be taken by, the Outstanding Units shall be deemed to be
references to the votes or acts of the Record Holders of such Outstanding
Units.
(b) With
respect to Units that are held for a Person’s account by another Person (such as
a broker, dealer, bank, trust company or clearing corporation, or an agent of
any of the foregoing), in whose name such Units are registered, such other
Person shall, in exercising the voting rights in respect of such Units on any
matter, and unless the arrangement between such Persons provides otherwise, vote
such Units in favor of, and at the direction of, the Person who is the
beneficial owner, and the Partnership shall be entitled to assume it is so
acting without further inquiry. The provisions of this Section 13.12(b) (as well
as all other provisions of this Agreement) are subject to the provisions of
Section 4.3.
Section
14.1 Authority. The
Partnership may merge or consolidate with or into one or more corporations,
limited liability companies, statutory trusts or associations, real estate
investment trusts, common law trusts or unincorporated businesses, including a
partnership (whether general or limited (including a limited liability
partnership)), pursuant to a written agreement of merger or consolidation
(“Merger
Agreement”) in accordance with this Article XIV.
Section
14.2 Procedure for Merger or
Consolidation. Merger or consolidation of the
Partnership pursuant to this Article XIV requires the approval of the Board of
Directors and the prior consent of the General Partner; provided, however, that, to the
fullest extent permitted by law, neither the Board of Directors nor the General
Partner shall have a duty or obligation to consent to any merger or
consolidation of the Partnership and may decline to do so free of any fiduciary
duty or obligation whatsoever to the Partnership or any Limited Partner and, in
declining to consent to a merger or consolidation, shall not be required to act
in good faith or pursuant to any other standard imposed by this Agreement, any
Group Member Agreement, any other agreement contemplated hereby or under the
Marshall Islands Act or any other law, rule or regulation or at equity. If the
Board of Directors and the General Partner shall determine to consent to the
merger or consolidation, the Board of Directors and the General Partner shall
approve the Merger Agreement, which shall set forth:
(a) the
names and jurisdictions of formation or organization of each of the business
entities proposing to merge or consolidate;
(b) the
name and jurisdiction of formation or organization of the business entity that
is to survive the proposed merger or consolidation (the “Surviving Business
Entity”);
(c) the
terms and conditions of the proposed merger or consolidation;
(d) the
manner and basis of exchanging or converting the equity securities of each
constituent business entity for, or into, cash, property or interests, rights,
securities or obligations of the Surviving Business Entity; and (i) if any
general or limited partner interests, securities or rights of any constituent
business entity are not to be exchanged or converted solely for, or into, cash,
property or interests, rights, securities or obligations of the Surviving
Business Entity, the cash, property or general or limited partner interests,
rights, securities or obligations of any general or limited partnership,
corporation, trust, limited liability company, unincorporated business or other
Person (other than the Surviving Business Entity) which the holders of such
interests, securities or rights are to receive in exchange for, or upon
conversion of their interests, securities or rights, and (ii) in the case of
securities represented by certificates, upon the surrender of such certificates,
which cash, property or interests, rights, securities or obligations of the
Surviving Business Entity or any general or limited partnership, corporation,
trust, limited liability company, unincorporated business or other Person (other
than the Surviving Business Entity), or evidences thereof, are to be
delivered;
(e) a
statement of any changes in the constituent documents or the adoption of new
constituent documents (the articles or certificate of incorporation, articles of
trust, declaration of trust, certificate or agreement of limited partnership or
other similar charter or governing document) of the Surviving Business Entity to
be effected by such merger or consolidation;
(f) the
effective time of the merger, which may be the date of the filing of the
certificate of merger pursuant to Section 14.4 or a later date specified in or
determinable in accordance with the Merger Agreement (provided, that if the
effective time of the merger is to be later than the date of the filing of such
certificate of merger, the effective time shall be fixed at a date or time
certain at or prior to the time of the filing of such certificate of merger and
stated therein); and
(g) such
other provisions with respect to the proposed merger or consolidation that the
Board of Directors and the General Partner determine to be necessary or
appropriate.
Section
14.3 Approval by Limited Partners
of Merger or Consolidation.
(a) Except
as provided in Sections 14.3(d) and 14.3(e), the Board of Directors, upon its
and the General Partner’s approval of the Merger Agreement, shall direct that
the Merger Agreement be submitted to a vote of Limited Partners, whether at a
special meeting or by written consent, in either case in accordance with the
requirements of Article XIII. A copy or a summary of the Merger Agreement shall
be included in or enclosed with the notice of a special meeting or the written
consent.
(b) Except
as provided in Sections 14.3(d) and 14.3(e), the Merger Agreement shall be
approved upon receiving the affirmative vote or consent of the holders of a Unit
Majority.
(c) Except
as provided in Sections 14.3(d) and 14.3(e), after such approval by vote or
consent of the Limited Partners, and at any time prior to the filing of the
certificate of merger pursuant to Section 14.4, the merger or consolidation may
be abandoned pursuant to provisions therefor, if any, set forth in the Merger
Agreement.
(d) Notwithstanding
anything else contained in this Article XIV or in this Agreement, the Board of
Directors is permitted, without Limited Partner approval, to convert the
Partnership or any Group Member into a new limited liability entity, to merge
the Partnership or any Group Member into, or convey all of the Partnership’s
assets to, another limited liability entity which shall be newly formed and
shall have no assets, liabilities or operations at the time of such conversion,
merger or conveyance other than those it receives from the Partnership or other
Group Member if (i) the Board of Directors has received an Opinion of Counsel
that the conversion, merger or conveyance, as the case may be, would not result
in the loss of the limited liability of any Limited Partner, (ii) the sole
purpose of such conversion, merger or conveyance is to effect a mere change in
the legal form of the Partnership into another limited liability entity and
(iii) the governing instruments of the new entity provide the Limited Partners,
the General Partner and the Board of Directors with the same rights and
obligations as are herein contained.
(e) Additionally,
notwithstanding anything else contained in this Article XIV or in this
Agreement, the Board of Directors, with the prior consent of the General
Partner, is permitted, without Limited Partner approval, to merge or consolidate
the Partnership with or into another entity if (i) the Board of Directors has
received an Opinion of Counsel that the merger or consolidation, as the case may
be, would not result in the loss of the limited liability of any Limited
Partner, (ii) the merger or consolidation would not result in an amendment to
this Agreement, other than any amendments that could be adopted pursuant to
Section 13.1, (iii) the Partnership is the Surviving Business Entity in such
merger or consolidation, (iv) each Unit outstanding immediately prior to the
effective date of the merger or consolidation is to be an identical Unit of the
Partnership after the effective date of the merger or consolidation, and (v) the
number of Partnership Securities to be issued by the Partnership in such merger
or consolidation does not exceed 20% of the Partnership Securities Outstanding
immediately prior to the effective date of such merger or
consolidation.
Section
14.4 Certificate of
Merger. Upon the required approval by the Board of
Directors, the General Partner and the Unitholders of a Merger Agreement, a
certificate of merger shall be executed and filed in conformity with the
requirements of the Marshall Islands Act.
Section
14.5 Amendment of Partnership
Agreement. Pursuant to Section 20(2) of the
Marshall Islands Act, an agreement of merger or consolidation approved in
accordance with Section 20(2) of the Marshall Islands Act may (a) effect any
amendment to this Agreement or (b) effect the adoption of a new partnership
agreement for a limited partnership if it is the Surviving Business Entity. Any
such amendment or adoption made pursuant to this Section 14.5 shall be effective
at the effective time or date of the merger or consolidation.
Section
14.6 Effect of
Merger.
(a) At
the effective time of the certificate of merger:
(i) all
of the rights, privileges and powers of each of the business entities that has
merged or consolidated, and all property, real, personal and mixed, and all
debts due to any of those business entities and all other things and causes of
action belonging to each of those business entities, shall be vested in the
Surviving Business Entity and after the merger or consolidation shall be the
property of the Surviving Business Entity to the extent they were of each
constituent business entity;
(ii) the
title to any real property vested by deed or otherwise in any of those
constituent business entities shall not revert and is not in any way impaired
because of the merger or consolidation;
(iii) all
rights of creditors and all liens on or security interests in property of any of
those constituent business entities shall be preserved unimpaired;
and
(iv) all
debts, liabilities and duties of those constituent business entities shall
attach to the Surviving Business Entity and may be enforced against it to the
same extent as if the debts, liabilities and duties had been incurred or
contracted by it.
(b) A
merger or consolidation effected pursuant to this Article shall not be deemed to
result in a transfer or assignment of assets or liabilities from one entity to
another.
RIGHT
TO ACQUIRE LIMITED PARTNER INTERESTS
Section
15.1 Right to Acquire Limited
Partner Interests.
(a) Notwithstanding
any other provision of this Agreement, if at any time the General Partner and
its Affiliates hold more than 80% of the total Limited Partner Interests of any
class then Outstanding, the General Partner shall then have the right, which
right it may assign and transfer in whole or in part to the Partnership or any
Affiliate of the General Partner, exercisable at its option, to purchase all,
but not less than all, of such Limited Partner Interests of such class then
Outstanding held by Persons other than the General Partner and its Affiliates,
at the greater of (x) the Current Market Price as of the date three days prior
to the date that the notice described in Section 15.1(b) is mailed and (y) the
highest price paid by the General Partner or any of its Affiliates for any such
Limited Partner Interest of such class purchased during the 90-day period
preceding the date that the notice described in Section 15.1(b) is
mailed.
(b) If
the General Partner, any Affiliate of the General Partner or the Partnership
elects to exercise the right to purchase Limited Partner Interests granted
pursuant to Section 15.1(a), the General Partner shall deliver to the Transfer
Agent notice of such election to purchase (the “Notice of Election to
Purchase”) and shall cause the Transfer Agent to mail a copy of such
Notice of Election to Purchase to the Record Holders of Limited Partner
Interests of such class (as of a Record Date selected by the General Partner) at
least 10, but not more than 60, days prior to the Purchase Date. Such Notice of
Election to Purchase shall also be published for a period of at least three
consecutive days in at least two daily newspapers of general circulation printed
in the English language and published in the Borough of Manhattan, New York. The
Notice of Election to Purchase shall specify the Purchase Date and the price
(determined in accordance with Section 15.1(a)) at which Limited Partner
Interests will be purchased and state that the General Partner, its Affiliate or
the Partnership, as the case may be, elects to purchase such Limited Partner
Interests, upon surrender of Certificates representing such Limited Partner
Interests in exchange for payment, at such office or offices of the Transfer
Agent as the Transfer Agent may specify, or as may be required by any National
Securities Exchange on which such Limited Partner Interests are listed. Any such
Notice of Election to Purchase mailed to a Record Holder of Limited Partner
Interests at his address as reflected in the records of the Transfer Agent shall
be conclusively presumed to have been given regardless of whether the owner
receives such notice. On or prior to the Purchase Date, the General Partner, its
Affiliate or the Partnership, as the case may be, shall deposit with the
Transfer Agent cash in an amount sufficient to pay the aggregate purchase price
of all of such Limited Partner Interests to be purchased in accordance with this
Section 15.1. If the Notice of Election to Purchase shall have been duly given
as aforesaid at least 10 days prior to the Purchase Date, and if on or prior to
the Purchase Date the deposit described in the preceding sentence has been made
for the benefit of the holders of Limited Partner Interests subject to purchase
as provided herein, then from and after the Purchase Date, notwithstanding that
any Certificate shall not have been surrendered for purchase, all rights of the
holders of such Limited Partner Interests (including any rights pursuant to
Articles IV, V, VI and XII) shall thereupon cease, except the right to receive
the applicable purchase price (determined in accordance with Section 15.1(a))
for Limited Partner Interests therefor, without interest, upon surrender to the
Transfer Agent of the Certificates representing such Limited Partner Interests,
and such Limited Partner Interests shall thereupon be deemed to be transferred
to the General Partner, its Affiliate or the Partnership, as the case may be, on
the record books of the Transfer Agent and the Partnership, and the General
Partner or any Affiliate of the General Partner, or the Partnership, as the case
may be, shall be deemed to be the owner of all such Limited Partner Interests
from and after the Purchase Date and shall have all rights as the
owner of such Limited Partner Interests (including all rights as owner of such
Limited Partner Interests pursuant to Articles IV, V, VI and
XII).
(c) At
any time from and after the Purchase Date, a holder of an Outstanding Limited
Partner Interest subject to purchase as provided in this Section 15.1 may
surrender his Certificate evidencing such Limited Partner Interest to the
Transfer Agent in exchange for payment of the amount described in Section
15.1(a), without interest thereon.
Section
16.1 Addresses and
Notices.
(a) Any
notice, demand, request, report or proxy materials required or permitted to be
given or made to a 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 United
States mail or by other means of written communication to the Partner at the
address described below. Any notice, payment or report to be given or made to a
Partner hereunder shall be deemed conclusively to have been given or made, and
the obligation to give such notice or report or to make such payment shall be
deemed conclusively to have been fully satisfied, upon sending of such notice,
payment or report to the Record Holder of such Partnership Securities at his
address as shown on the records of the Transfer Agent or as otherwise shown on
the records of the Partnership, regardless of any claim of any Person who may
have an interest in such Partnership Securities by reason of any assignment or
otherwise. An affidavit or certificate of making of any notice, payment or
report in accordance with the provisions of this Section 16.1 executed by a
member of the Board of Directors, the General Partner, the Transfer Agent or the
mailing organization shall be prima facie evidence of the giving or making of
such notice, payment or report. If any notice, payment or report addressed to a
Record Holder at the address of such Record Holder appearing on the books and
records of the Transfer Agent or the Partnership is returned by the United
States Postal Service marked to indicate that the United States Postal Service
is unable to deliver it, such notice, payment or report and any subsequent
notices, payments and reports shall be deemed to have been duly given or made
without further mailing (until such time as such Record Holder or another Person
notifies the Transfer Agent or the Partnership of a change in his address) if
they are available for the Partner at the principal office of the Partnership
for a period of one year from the date of the giving or making of such notice,
payment or report to the other Partners. Any notice to the Partnership shall be
deemed given if received by the General Partner or the Board of Directors at the
principal office of the Partnership designated pursuant to Section 2.3. The
General Partner and the Board of Directors may rely and shall be protected in
relying on any notice or other document from a Partner or other Person if
believed by it to be genuine.
Section
16.2 Further
Action. The parties shall execute and deliver all
documents, provide all information and take or refrain from taking action as may
be necessary or appropriate to achieve the purposes of this
Agreement.
Section
16.3 Binding
Effect. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective heirs,
executors, administrators, successors, legal representatives and permitted
assigns.
Section
16.4 Integration. This
Agreement constitutes the entire agreement among the parties hereto pertaining
to the subject matter hereof and supersedes all prior agreements and
understandings pertaining thereto.
Section
16.5 Creditors. None
of the provisions of this Agreement shall be for the benefit of, or shall be
enforceable by, any creditor of the Partnership.
Section
16.6 Waiver. No
failure by any party to insist upon the strict performance of any covenant,
duty, agreement or condition of this Agreement or to exercise any right or
remedy consequent upon a breach thereof shall constitute waiver of any such
breach of any other covenant, duty, agreement or condition.
Section
16.7 Counterparts. This
Agreement may be executed in counterparts, all of which together shall
constitute an agreement binding on all the parties hereto, notwithstanding that
all such parties are not signatories to the original or the same counterpart.
Each party shall become bound by this Agreement immediately upon affixing its
signature hereto or, in the case of a Person acquiring a Limited Partner
Interest, pursuant to Section 10.2(a) without execution
hereof.
Section
16.8 Applicable
Law. This Agreement shall be construed in
accordance with and governed by the laws of The Republic of the Marshall
Islands, without regard to the principles of conflicts of
law.
Section
16.9 Invalidity of
Provisions. If any provision of this Agreement is
or becomes invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not be affected thereby.
Section
16.10 Consent of
Partners. Each Partner hereby expressly consents
and agrees that, whenever in this Agreement it is specified that an action may
be taken upon the affirmative vote or consent of less than all of the Partners,
such action may be so taken upon the concurrence of less than all of the
Partners and each Partner shall be bound by the results of such
action.
Section
16.11 Facsimile
Signatures. The use of facsimile signatures
affixed in the name and on behalf of the transfer agent and registrar of the
Partnership on certificates representing Common Units is expressly permitted by
this Agreement.
Section
16.12 Third-Party
Beneficiaries. Each Partner agrees that any
Indemnitee shall be entitled to assert rights and remedies hereunder as a
third-party beneficiary hereto with respect to those provisions of this
Agreement affording a right, benefit or privilege to such
Indemnitee.
[REMAINDER
OF THIS PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto
have executed this Second Amended and Restated Agreement of Limited Partnership
as a Deed as of the date first written above.
GENERAL
PARTNER:
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Navios GP
L.L.C.,
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By:
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Name:
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Title:
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ORGANIZATIONAL LIMITED
PARTNER:
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Navios Maritime
Holdings Inc.,
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By:
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Name:
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Title:
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LIMITED
PARTNERS:
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All Limited Partners
now and hereafter admitted as Limited Partners of the Partnership,
pursuant to powers of attorney now and hereafter executed in favor of, and
granted and delivered to the Board of Directors.
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By:
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Angeliki Frangou,
Chairman of the Board of Directors of Navios Maritime Partners L.P., as
attorney-in-fact for all Limited Partners pursuant to the Power of
Attorney granted under Section 2.6
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Name:
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Angeliki
Frangou
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Title:
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Attorney-in-Fact
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Unassociated Document
AMENDMENT
TO SHARE PURCHASE AGREEMENT
This
AMENDMENT TO SHARE PURCHASE AGREEMENT (this “Amendment”), dated as of June 29,
2009, is made by and between ANEMOS MARITIME HOLDINGS INC. (the “Seller”), a
wholly-owned subsidiary of Navios Maritime Holdings Inc. (“NMHI”) and a
corporation organized under the laws of the Republic of the Marshall Islands,
and NAVIOS MARITIME PARTNERS L.P. (the “Buyer,” and together with Seller, the
“Parties”), a limited partnership organized under the laws of the Republic of
the Marshall Islands.
WITNESSETH:
WHEREAS,
the Parties are currently parties to that certain Share Purchase Agreement,
dated as of November 16, 2007 (the “Share Purchase Agreement”);
WHEREAS, Buyer, NMHI, Navios GP
L.L.C., a Marshall Islands limited liability company, and Navios Maritime
Operating L.L.C., a Marshall Islands limited liability company (together, the
“Navios Entities”), are currently parties to that certain Omnibus Agreement,
dated as of November 16, 2007 (the “Omnibus Agreement”); and
WHEREAS,
the Parties and the other Navios Entities desire to amend the Share Purchase
Agreement, as set forth herein, and the Omnibus Agreement, as set forth in that
certain Amendment to Omnibus Agreement, dated of even date herewith, in
consideration for the issuance by Buyer to NMHI of 1,000,000 Subordinated Series
A Units of the Buyer pursuant to that certain Subscription Agreement, dated June
9, 2009, attached hereto as Exhibit A;
capitalized terms used herein and not otherwise defined shall have the meanings
given such terms in the Share Purchase Agreement.
NOW,
THEREFORE, in consideration of the premises and the mutual covenants contained
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereby agree as
follows:
1. The
first recital of the Share Purchase Agreement is hereby deleted in its entirety
and replaced by the following:
“WHEREAS,
the Buyer may wish to purchase from the Seller, and the Seller wishes to sell to
the Buyer, subject to the terms and conditions set forth herein, the shares of
common stock as set forth on Schedule C to this Agreement (the “Shares”)
representing all of the issued and outstanding shares of common stock of the
vessel owning subsidiary that will take delivery of the Capesize vessel (the
“Vessel”) as set forth in Schedule A hereto (the “Vessel Owning
Subsidiary”).”
2. The
following definitions are hereby added to Section 1.01 of the Share Purchase
Agreement:
“Election Notice” has
the meaning given to it in Section 2.01(b); and
“Notice Period” means
the term commencing at 12:01 am, New York time, on June 29, 2009 and ending at
11:59 pm, New York time on June 29, 2010;
3. Article
II of the Share Purchase Agreement is hereby deleted in its entirety and
replaced by the following:
“ARTICLE II
Purchase and Sale of Shares;
Closing
SECTION
2.01 Purchase and Sale of
Shares.
(a) The
Seller agrees to sell and transfer to the Buyer, and, subject to the provisions
of Section 2.01(b), the Buyer agrees to purchase from the Seller for the
Purchase Price and in accordance with and subject to the terms and conditions
set forth in this Agreement, the Shares.
(b) Notwithstanding
the provisions of Section 2.01(a), the Buyer shall not be obligated to purchase
the Shares from the Seller unless the Buyer shall have delivered to the Seller
at any time during the Notice Period a written notice indicating an affirmative
election to purchase the Shares (“Election Notice”). The Buyer shall have the
sole discretion to determine whether to deliver an Election Notice to the
Seller. If the Election Notice has not been delivered by the Buyer to the Seller
at any time during the Notice Period, any and all rights and obligations of the
Buyer and the Seller set forth in this Agreement shall expire and terminate upon
the expiration of the Notice Period.
SECTION
2.02 Closing. On the terms
and subject to the conditions of this Agreement, the sale and transfer of the
Shares and payment of the Purchase Price shall take place on a date that is
within five (5) Business Days of the delivery of the Election Notice by the
Buyer to the Seller as set forth in Section 2.01(b) or on such other date as may
be agreed upon in writing by the Seller and the Buyer (the “Time of Closing”);
provided that
if any such sale and transfer of the Shares is scheduled to occur on the
Delivery Date, the Time of Closing must be after the registration of the Vessel
in the name of the Vessel Owning Subsidiary. The sale and transfer of the Shares
is hereinafter referred to as the “Closing.”
SECTION
2.03 Place
of Closing. The Closing shall occur at a place agreed upon in writing by
the Seller and the Buyer.
SECTION
2.04 Purchase Price for the
Shares. At the Time of Closing, the Buyer shall pay to the Seller (to
such account as the Seller shall nominate) the amount set out on Schedule B
across from the Vessel Owning Subsidiary’s name, for the Shares (the “Purchase
Price”).
SECTION
2.05 Payment of the Purchase
Price. The Purchase Price will be paid by the Buyer to the Seller by wire
transfer of immediately available funds to an account designated in writing by
the Seller.
SECTION
2.06 [Intentionally omitted.]”
4. Section
8.02(d) of the Share Purchase Agreement is hereby deleted in its entirety and
replaced by the following:
“(d) “the
Buyer shall have obtained the funds necessary to consummate the purchase and
sale of the Shares, to refinance all indebtedness the Buyer is required to
refinance as a result of the purchase and sale of the Shares and to pay all
related fees and expenses;”
3. Section
8.02(f) of the Share Purchase Agreement is hereby deleted in its entirety and
replaced by the following:
“(f) the
Buyer shall have delivered the Election Notice to the Seller during the Notice
Period; and
(g) all
proceedings to be taken in connection with the transaction contemplated by this
Agreement and all documents incidental thereto shall be reasonably satisfactory
in form and substance to the Buyer and its counsel, and the Buyer shall have
received copies of all such documents and other evidence as it or its counsel
may reasonably request in order to establish the consummation of such
transaction and the taking of all proceedings in connection
therewith.”
4. Section
9.01 of the Share Purchase Agreement is hereby deleted in its entirety and
replaced by the following:
“SECTION
9.01 Termination of
Agreement. Notwithstanding anything to the contrary in this Agreement,
this Agreement may be terminated and the purchase and sale of the Vessel Owning
Subsidiary contemplated by this Agreement abandoned at any time prior to the
Closing:
(a) by
mutual written consent of the Seller and the Buyer;
(b) without
any further action by either the Buyer or the Seller if, by the expiration of
the Notice Period, the Election Notice has not been delivered by the Buyer to
the Seller at any time during the Notice Period;
(c) by
the Seller if any of the conditions set forth in Section 8.01 shall have become
incapable of fulfillment, and shall not have been waived by the Seller;
or
(d) by
the Buyer if any of the conditions set forth in Section 8.02 shall have become
incapable of fulfillment, and shall not have been waived by the
Buyer.
provided, however, that the
party seeking termination pursuant to clause (c) or (d) is not then in material
breach of any of its representations, warranties, covenants or agreements
contained in this Agreement.”
5. Section
9.02(b) of the Share Purchase Agreement is hereby deleted in its entirety and
replaced by the following:
“(b) [Intentionally
omitted.]”
6. Schedule
B of the Share Purchase Agreement is hereby deleted in its entirety and replaced
with Exhibit B
hereto.
7. Except
as modified by this Amendment, all other terms and conditions in the Share
Purchase Agreement shall remain in full force and effect.
8. Unless
the context otherwise requires, the Share Purchase Agreement and this Amendment
shall be read together and shall have effect as if the provisions of the Share
Purchase Agreement and this Amendment were contained in one
agreement. After the effective date of this Amendment, all references
in the Share Purchase Agreement to “this Agreement,” “hereto,” “hereof,”
“hereunder” or words of like import referring to the Share Purchase Agreement
shall mean the Share Purchase Agreement as amended by this
Amendment.
9. This
Amendment may be executed in separate counterparts, all of which taken together
shall constitute a single instrument.
10. This
Amendment shall be governed by, and construed in accordance with, the laws of
the Republic of the Marshall Islands applicable to contracts made and to be
performed wholly within such jurisdiction without giving effect to conflict of
law principles thereof, except to the extent that it is mandatory that the law
of some other jurisdiction, such as wherein the Vessel is located, shall
apply.
[The remainder of this page has been
intentionally left blank]
IN WITNESS WHEREOF, the
parties hereto have executed this Amendment as of the day and year first above
written.
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ANEMOS
MARITIME HOLDINGS INC. |
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By:
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/s/ George Akhniotis |
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Name: |
George
Akhniotis |
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Title: |
Director/President |
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NAVIOS
MARITIME PARTNERS L.P. |
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By: |
/s/ Michael McClure |
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Name: |
Michael
McClure |
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Title: |
Chief
Financial Officer |
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Exhibit
A
SUBSCRIPTION
AGREEMENT
Exhibit B
SCHEDULE
B
PURCHASE
PRICE
Vessel Owning Subsidiary
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Purchase Price
(U.S. Dollars)
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Nostos
Shipmanagement Corp.
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$
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125,000,000
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Unassociated Document
AMENDMENT
TO OMNIBUS AGREEMENT
This
AMENDMENT TO OMNIBUS AGREEMENT (this “Amendment”), dated as of June 29, 2009, is
made by and among Navios Maritime Holdings Inc., a Marshall Islands corporation
(“Navios Maritime”), Navios GP L.L.C., a Marshall Islands limited liability
company (the “General Partner”), Navios Maritime Operating L.L.C., a Marshall
Islands limited liability company (the “OLLC”), and Navios Maritime Partners
L.P., a Marshall Islands limited partnership (the “MLP”, and together with
Navios Maritime, the General Partner and the OLLC, the “Parties”) and amends the
Omnibus Agreement (the “Agreement”) entered into among the Parties on November
16, 2007. Capitalized terms used and not otherwise defined in this Amendment
shall have the meanings given them in the Agreement.
WITNESSETH:
WHEREAS,
the Agreement provide that the terms thereof may be amended only pursuant to a
written instrument executed by the Parties; and
WHEREAS,
the Parties desire to amend the Agreement;
NOW,
THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereby agree as follows:
1. Section
2.1 shall be amended to add a second paragraph as follows:
“Notwithstanding
the prohibition in this Section 2.1, such prohibition on each of the Navios
Maritime Entities shall not be effective from June 29, 2009 until June 29, 2011;
provided, however, such prohibition on each of the Navios Maritime Entities
shall remain in effect for Panamax Drybulk Carriers or Capesize Drybulk Carriers
that are owned as of the date of this Amendment that become subject to a
Qualifying Contract.”
2. Section
2.2(b) shall be amended to add the following at the end of the only
sentence of that Section 2.2(b):
“or if
such Panamax Carrier Asset or Capesize Carrier Asset was acquired during the
period from June 29, 2009 until June 29, 2011.”
3. Following
Section 5.1(b), new Section 5.1(c) shall be added to the Agreement in its
entirety:
“(c)
Notwithstanding the right of first offer the Navios Maritime Entities granted to
the MLP pursuant to the second sentence of Section 5.1(a), such right of first
offer granted to the MLP shall not be effective from June 29, 2009 until June
29, 2011; provided, however, such right of first offer shall remain in effect
for Panamax Drybulk Carriers or Capesize Drybulk Carriers that are owned as of
the date of this Amendment that become subject to a Qualifying
Contract.”
3. Full Force and
Effect. Except as modified by this Amendment, all other terms
and conditions in the Agreement shall remain in full force and
effect.
4. Effect. Unless
the context otherwise requires, the Agreement, as amended, and this Amendment
shall be read together and shall have effect as if the provisions of the
Agreement, as amended, and this Amendment were contained in one
agreement. After the effective date of this Amendment, all references
in the Agreement to “this Agreement,” “hereto,” “hereof,” “hereunder” or words
of like import referring to the Agreement shall mean the Agreement, as amended,
as further modified by this Amendment.
5. Counterparts. This
Amendment may be executed in separate counterparts, all of which taken together
shall constitute a single instrument.
[Remainder of page intentionally left
blank. Signature page to follow.]
IN WITNESS WHEREOF, the parties hereto
have executed this Amendment effective as of the day and year first above
written.
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NAVIOS
MARITIME HOLDINGS INC.
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by
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/s/
George Achniotis |
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Name:
George Achniotis
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Title: Chief
Financial Officer
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NAVIOS
GP L.L.C.
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by
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/s/
Vasiliki Papaefthymiou |
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Name: Vasiliki
Papaefthymiou
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Title: Secretary
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NAVIOS
MARITIME OPERATING L.L.C.
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by:
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/s/
Vasiliki Papaefthymiou |
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Name:
Vasiliki Papaefthymiou
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Title:
Secretary
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NAVIOS
MARITIME PARTNERS L.P.
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by
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/s/
Michael McClure |
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Name:
Michael McClure
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Title:
Chief Financial Officer
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[Signature
Page - Amendment to Omnibus Agreement]
Unassociated Document
WAIVER
OF NAVIOS MARITIME PARTNERS L.P.
June 29,
2009
Reference
is hereby made to that certain RIGHT OF FIRST REFUSAL AND CORPORATE
OPPORTUNITIES AGREEMENT (the “Agreement”) made as of June 25, 2008 by and among
Navios Maritime Acquisition Corporation, a Marshall Islands corporation (the
“Company”), Navios Maritime Holdings Inc., a Marshall Islands corporation
(“Navios Holdings”), and Navios Maritime Partners L.P. (“Navios Partners”) in connection with the Company’s public
offering in the United States. Capitalized terms used herein and not
defined shall have the meanings ascribed to such terms in the
Agreement.
WHEREAS, Anemos Maritime Holdings
Inc., a wholly-owned subsidiary of Navios Holdings and a corporation organized
under the laws of the Republic of the Marshall Islands, and Navios Partners are
currently parties to that certain Share Purchase Agreement, dated as of November
16, 2007 (the “Share Purchase Agreement”);
WHEREAS, Navios Partners, Navios
Holdings, Navios GP L.L.C., a Marshall Islands limited liability company, and
Navios Maritime Operating L.L.C., a Marshall Islands limited liability company
(together, the “Navios Entities”), are currently parties to that certain Omnibus
Agreement, dated as of November 16, 2007 (the “Omnibus Agreement”);
and
WHEREAS,
the respective parties thereto desire to amend the Share Purchase Agreement, as
set forth in that certain Amendment to Share Purchase Agreement, dated of even
date herewith, and the Omnibus Agreement, as set forth in that certain Amendment
to Omnibus Agreement, dated of even date herewith, and Navios Holdings desires
that Navios Partners waive certain rights of first refusal granted under Section
1(c) of the Agreement as set forth herein, in consideration for execution of
such amendments and the issuance by Navios Partners to Navios Holdings of
1,000,000 Subordinated Series A Units of Navios Partners pursuant to that
certain Subscription Agreement, dated June 9, 2009, attached hereto as Exhibit
A.
NOW,
THEREFORE, in consideration for the mutual covenants contained herein and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the undersigned hereby agrees as follows:
The
undersigned hereby waives any and all of its rights of first refusal with
respect to an acquisition opportunity relating to any Panamax or Capesize dry
bulk carrier under charter for three or more years as set forth under Section
1(c) of the Agreement for the period commencing on the date hereof and
terminating on the earliest of (a) the consummation by the Company of a Business
Combination in the circumstances and in the manner described in the Registration
Statement, (b) the Company’s liquidation in the circumstances and in the manner
described in the Registration Statement, and (c) June 29, 2011.
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NAVIOS
MARITIME PARTNERS L.P. |
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By:
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/s/ Michael McClure |
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Name: |
Michael
McClure |
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Title: |
Chief
Financial Officer |
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