0001026081-01-500006.txt : 20011009
0001026081-01-500006.hdr.sgml : 20011009
ACCESSION NUMBER: 0001026081-01-500006
CONFORMED SUBMISSION TYPE: SC 13D
PUBLIC DOCUMENT COUNT: 10
FILED AS OF DATE: 20010928
GROUP MEMBERS: SEIDMAN AND ASSOCIATES LLC ET AL
SUBJECT COMPANY:
COMPANY DATA:
COMPANY CONFORMED NAME: WARWICK COMMUNITY BANCORP INC
CENTRAL INDEX KEY: 0001046209
STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTIONS, NOT FEDERALLY CHARTERED [6036]
IRS NUMBER: 061497903
STATE OF INCORPORATION: DE
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: SC 13D
SEC ACT: 1934 Act
SEC FILE NUMBER: 005-53491
FILM NUMBER: 1747947
BUSINESS ADDRESS:
STREET 1: 18 OAKLAND AVE
STREET 2: PO BOX 591
CITY: WARWICK
STATE: NY
ZIP: 10990-0591
BUSINESS PHONE: 9149862206
MAIL ADDRESS:
STREET 1: 18 OAKLAND AVE
STREET 2: PO BOX 591
CITY: WARWICK
STATE: NY
ZIP: 10990-0591
FILED BY:
COMPANY DATA:
COMPANY CONFORMED NAME: SEIDMAN LAWRENCE B
CENTRAL INDEX KEY: 0001026081
STANDARD INDUSTRIAL CLASSIFICATION: []
STATE OF INCORPORATION: NJ
FILING VALUES:
FORM TYPE: SC 13D
BUSINESS ADDRESS:
STREET 1: LANIDEX CENTER
STREET 2: 100 MISTY LANE P O BOX 5430
CITY: PARSIPPANY
STATE: NJ
ZIP: 07054
BUSINESS PHONE: 2015601400
MAIL ADDRESS:
STREET 1: LANIDEX CENTER
STREET 2: 100 MISTY LANE P O BOX 5430
CITY: PARSIPPANY
STATE: NJ
ZIP: 07054
SC 13D
1
w13d.txt
INITIAL STATEMENT OF BENEFICIAL OWNERSHIP
OMB APPROVAL
OMB Number:3235-0145
Expires: October 31, 1997
Estimated average burden
hours per response....14.9
SECURlTIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities and Exchange Act of 1934
(Amendment No. )*
Warwick Community Bancorp, Inc.
-------------------------------------------------------------------------------
Common Stock
-------------------------------------------------------------------------------
0003622631
-----------------------------------------------------------------------------
(CUSIP Number)
Lawrence B. Seidman, 100 Misty Lane, Parsippany, NJ 07054,
(973) 560-1400, Ext.108
-------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
September 20, 2001
----------------------------------------------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Sections 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check
the following box. [ ]
Note:Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Section 240.13d-7 for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
SCHEDULE 13D
CUSIP NO.0003622631
NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Seidman and Associates, L.L.C. 22-3343079
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
WC
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New Jersey
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
67,900
NUMBER OF -------------------------------------------------------------------
SHARES
BENFICIALLY 8 SHARED VOTING POWER
--------------------------------------------------------------
OWNED BY
9 SOLE DISPOSITIVE POWER
67,900
PERSON -----------------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
--------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON 67,900
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 1.317
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON* OO
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
SCHEDULE 13D
CUSIP NO.0003622631
NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Seidman Investment Partnership, L.P. 22-3360395
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
WC
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New Jersey
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF 31,200
--------------------------------------------------------------
SHARES
BENFICIALLY 8 SHARED VOTING POWER
--------------------------------------------------------------
OWNED BY
9 SOLE DISPOSITIVE POWER
31,200
PERSON -----------------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
--------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON 31,200
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) .605
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON* PN
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
SCHEDULE 13D
CUSIP NO. 0003622631
NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Seidman Investment Partnership II, L.P. 22-3603662
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
WC
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New Jersey
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF 31,200
--------------------------------------------------------------
SHARES
BENFICIALLY 8 SHARED VOTING POWER
--------------------------------------------------------------
OWNED BY
9 SOLE DISPOSITIVE POWER
31,200
PERSON -----------------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
--------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON 31,200
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) .605
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON* PN
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
SCHEDULE 13D
CUSIP NO.0003622631
NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Kerrimatt, L.P. 22-3583179
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
WC
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New Jersey
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF 31,200
--------------------------------------------------------------
SHARES
BENFICIALLY 8 SHARED VOTING POWER
--------------------------------------------------------------
OWNED BY
9 SOLE DISPOSITIVE POWER
31,200
PERSON -----------------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
--------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON 31,200
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) .605
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON* PN
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
SCHEDULE 13D
CUSIP NO.0003622631
NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Federal Holdings, L.L.C. 13-3838083
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
WC
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New Jersey
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF 31,200
--------------------------------------------------------------
SHARES
BENFICIALLY 8 SHARED VOTING POWER
--------------------------------------------------------------
OWNED BY
9 SOLE DISPOSITIVE POWER
31,200
PERSON -----------------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
--------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON 31,200
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) .605
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON* OO
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
SCHEDULE 13D
CUSIP NO. 0003622631
NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Lawrence B. Seidman ###-##-####
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF WC
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF 218,100
--------------------------------------------------------------
SHARES
BENFICIALLY 8 SHARED VOTING POWER
32,700
--------------------------------------------------------------
OWNED BY
9 SOLE DISPOSITIVE POWER
218,100
PERSON -----------------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
32,700
--------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON 250,800
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 4.86
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON* IN
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
SCHEDULE 13D
CUSIP NO. 0003622631
NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Dennis Pollack ###-##-####
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF WC
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF 16,620
--------------------------------------------------------------
SHARES
BENFICIALLY 8 SHARED VOTING POWER
32,700
--------------------------------------------------------------
OWNED BY
9 SOLE DISPOSITIVE POWER
16,620
PERSON -----------------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
--------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON 49,320
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) .956
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON* IN
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
CUSIP NO.0003622631
NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Pollack Investment Partnership, L.P. 22-3736367
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
WC
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New Jersey
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF 32,700
--------------------------------------------------------------
SHARES
BENFICIALLY 8 SHARED VOTING POWER
--------------------------------------------------------------
OWNED BY
9 SOLE DISPOSITIVE POWER
32,700
PERSON -----------------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
--------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON 32,700
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) .634
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON* PN
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
1. Security and Issuer
The class of equity securities to which this Statement relates is the common
stock (the "Common Stock") of Warwick Community Bancorp, Inc., a Delaware
corporation (the "Issuer"). The Issuer's principal executive offices are located
at 18 Oakland Avenue, Warwick, NY 10990-0591.
2. Identity and Background
(a-c) This statement is being filed by Seidman and Associates L.L.C. ("SAL"), a
New Jersey limited liability company, organized to invest in securities, whose
principal and executive offices are located at 19 Veteri Place, Wayne, New
Jersey 07470. Lawrence Seidman is the Manager of SAL and has sole investment
discretion and voting authority with respect to such securities.
This statement is also being filed by Seidman Investment Partnership, L.P.
("SIP"), a New Jersey limited partnership, whose principal and executive offices
are located at 19 Veteri Place, Wayne, NJ 07470. Veteri Place Corporation is the
sole General Partner of SIP and Lawrence Seidman is the only shareholder
director and officer of Veteri Place Corporation. Seidman has sole investment
discretion and voting authority with respect to such securities.
This statement is also being filed by Seidman Investment Partnership II, L.P.
("SIPII"), a New Jersey limited partnership, whose principal and executive
offices are located at 19 Veteri Place, Wayne, NJ 07470. Veteri Place
Corporation is the sole General Partner of SIPII and Lawrence Seidman is the
only shareholder, director and officer of Veteri Place Corporation. Seidman has
sole investment discretion and voting authority with respect to such securities.
This statement is also being filed by Kerrimatt, LP (Kerrimatt), a limited
partnership formed, in part, to invest in stock of public companies whose
principal and executive offices are located at 80 Main Street, West Orange, New
Jersey 07052. Pursuant to the Kerrimatt Letter Agreement, Lawrence Seidman has
the sole investment discretion and voting authority with respect to such
securities until May 2002.
This statement is also being filed by Federal Holdings L.L.C. ("Federal"), a New
York limited liability company, organized to invest in securities, whose
principal and executive offices are located at One Rockefeller Plaza, 31st
Floor, New York, NY 10020. Lawrence B. Seidman is the Manager of Federal and has
sole investment discretion and voting authority with respect to such securities.
Kevin Moore is the Administrative Manager of Federal.
This statement is also being filed by Pollack Investment Partnership, L.P.
("PIP"), a New Jersey limited partnership, whose principal and executive offices
are located at 47 Blueberry Drive, Woodcliff Lake, NJ 07677. Dennis Pollack
("Pollack") and Lawrence B. Seidman ("Seidman") are the General Partners of PIP.
Pollack and Seidman share investment discretion and voting authority with
respect to such securities.
This statement is also being filed by Lawrence Seidman whose principal office is
located at 100 Misty Lane, Parsippany, NJ 07054. Mr. Seidman has sole investment
discretion and voting authority for SAL, SIP, SIPII, Kerrimatt, and Federal and
for Sonia Seidman ("SS"), his wife and Richard and Melissa Baer ("RMB"), Mr.
Seidman's clients. Mr. Seidman shares such authority with Pollack for PIP.
This statement is also being filed by Dennis Pollack ("Pollack"), whose
principal office is located at 47 Blueberry Drive, Woodcliff Lake, NJ 07677. Mr.
Pollack has sole investment discretion and voting authority for his wife and
children and shares such authority with Mr. Seidman for PIP.
The name, residence or business address, and the principal occupation or
employment and the name, principal business and address of any corporation or
other organization in which such employment is conducted, of each executive
officer and director and each controlling person, if any, of Seidman, Pollack,
SAL, SIP, SIPII, Kerrimatt, PIP and Federal, is set forth in Exhibit A hereto.
Seidman, Pollack, Federal, Kerrimatt, SAL, SIP, PIP and SIPII, shall hereinafter
be referred to as "Reporting Persons". The Reporting Persons have formed a group
with respect to the securities of the Issuer within the meaning of Rule 13d-5
under the Securities Exchange Act of 1934, as amended (the "Exchange Act").
(d-e) During the last five years none of SAL, SIP, SIPII, Federal, Kerrimatt,
SS, RMB, PIP, Pollack and Seidman, or, to the best of their knowledge, any
person listed in Exhibit A attached hereto (i) has been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors) or (ii) has
been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to,
a judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, federal or state securities laws or finding
any violation with respect to such laws.
(f) Each of the individuals listed on Exhibit A attached hereto is a citizen of
the United States.
3. Source and Amount of Funds or Other Consideration
The aggregate purchase price of the stock covered by this statement is
3,996,988.18. The purchases of Common Stock by some of the above entities
were in margin accounts carried by Bear Stearns Securities Corp. This extension
of credit was extended in the ordinary course of business. As of September 26,
2001, there was no margin loan balance outstanding.
4. Purpose of Transaction
The securities covered by this Statement were acquired for the purpose of
investment. The Reporting Persons filing this Statement may decide, jointly or
individually, to purchase additional shares of the Common Stock or other
securities of the Issuer. In addition the Reporting Persons, jointly or
individually, may dispose of any or all securities of the Issuer in any manner
permitted by applicable securities laws.
Mr. Seidman is a representative of the Reporting Persons and will attempt to
meet with the Board of Directors of the Issuer and the Issuer's management to
review ways to maximize shareholder value. The review includes conducting a
comprehensive review and analysis of the value that could be achieved as an
independent institution versus its value from a sale to a larger institution.
Certain of the Reporting Persons were involved in a proxy contest seeking the
election of directors to the Board of Directors of IBSF. These Reporting Persons
conducted two proxy contests and during litigation with respect to the results
of the second proxy contest, the management of IBSF agreed to sell the
institution in a stock for stock transaction to Hubco Inc.
In addition certain of the Reporting Persons were involved in two proxy contests
involving Wayne Bancorp, Inc. The first proxy contest involved the approval of
certain stock plans and option plans for the directors and senior management of
Wayne. This proxy contest was resolved prior to a shareholder vote because the
respective Reporting Persons agreed to vote for the stock plans and option plans
and the Board of Directors of Wayne Bancorp, Inc. agreed to place a
representative of the Reporting Persons on the Board. The second proxy contest
involved election of directors. During this proxy contest the management of
Wayne Bancorp, Inc. announced that Wayne, Bancorp, Inc. would be sold and
therefore the Reporting Persons' representative withdrew from seeking election
to the Board of Wayne Bancorp, Inc.
In addition certain of the Reporting Persons have filed a Schedule 13D in
connection with the common stock of 1st Bergen Bancorp, Inc. which company has
been acquired by Kearney Federal Savings Bank.
In addition certain of the Reporting Persons have filed a Schedule 13D in
connection with the Common Stock of Eagle BancGroup, Inc.("EGLB") and informally
notified the Company that they intended to solicit proxies for two director
nominees in opposition to the two management director nominees at the 1999
annual meeting. On June 30, 1999, EGLB announced the sale of the Company to
Busey Corporation.
In addition the Reporting Persons have filed a Schedule 13D in connection with
the Common Stock of Yonkers Financial Corp. ("YFCB") seeking representation on
the Board of Directors of YFCB. In January 2000 certain of the Reporting Persons
were involved in a proxy contest seeking to elect two directors to the YFCB
Board in opposition to the three management directors. These Reporting Persons
were not successful in connection with the proxy contest and the slate proposed
by the YFCB management was re-elected.
In addition, some of the Reporting Persons filed a Schedule 13D in connection
with the Common Stock of CNY Financial Corporation ("CNYF") requesting (i) Board
representation and (ii) that CNYF maximize shareholder value. On February 25,
1999, Seidman and certain of the Reporting Persons entered into an Agreement
with CNYF, wherein CNYF agreed to increase the size of its Board of Directors by
one and add Seidman as a Director. Seidman and the Members of the Committee
involved agreed to certain restrictions. The material restrictions in this
Agreement established the following undertakings: (i) to not acquire more than
9.9% of the outstanding CNYF stock before its year 2,000 Annual Meeting; (ii) to
vote for the CNY stock option and restricted stock plan and amendments thereto;
(iii) to not solicit proxies or submit proposals prior to the year 2000 Annual
Meeting; (iv) to vote all shares in favor of Seidman and the two (2) Board
Nominees at the 1999 Annual Meeting; and (v) not to do anything indirectly that
it could not do directly. Seidman voted his shares in support of CNYF stock
based compensation plans and he became a director of CNYF. On December 29, 1999,
CNYF agreed to be acquired by Niagara Bancorp, Inc. for $18.75 cash for each
CNYF share. The transaction closed on July 7, 2000.
In addition some of the Reporting Persons have filed a Schedule 13D in
connection with the Common Stock of South Jersey Financial Corporation, Inc.
("SJFC") seeking representation on the Board of Directors of SJFC. Certain of
the Reporting Persons were involved in a proxy contest seeking to elect two
directors to the SJFC Board in opposition to the three management directors. On
August 12, 1999, an Agreement was reached between SJFC and certain of the
Reporting Persons which permitted Seidman and a second proposed Nominee to
become directors of SJFC and for Seidman to become a director of South Jersey
Savings and Loan Association, the banking subsidiary of SJFC. In addition the
Reporting Persons agreed to support the stock option and restricted option plan
to be proposed by SJFC at a Special Meeting. On March 15, 2000, SJFC agreed to
be acquired by Richmond County Financial Corp. for $20.00 cash for each SFJC
share. The transaction closed on July 31, 2000.
In addition some of the Reporting Persons have filed a Schedule 13D in
connection with the Common Stock of Jade Financial Corporation ("IGAF"). On May
30, 2000, Mr. Seidman and certain of the Reporting Persons entered into a stock
Option Agreement with PSB Bancorp, Inc. ("PSB") whereby PSB was given the right
to purchase all of Mr. Seidman's controlled IGAF stock so long as PSB made an
offer to buy all of the IGAF outstanding shares at the same price. On November
2, 2000, PSB announced the execution of the Definitive Agreement and Plan of
Merger to acquire IGAF at $13.50 per share. On July 2, 2001 the merger by and
between PSB and IGAF was completed. Prior thereto PSB consummated the purchase
of Mr. Seidman's stock in accordance with the Option Agreement
In addition, certain of the Reporting Persons were involved in a proxy contest
seeking election of two directors to the Board of Directors of Citizens First
Financial Corp. ("CBK"). These Reporting Persons were not successful in
connection with the proxy contest and the slate proposed by the CBK management
was re-elected. However, Mr. Seidman was successful in having CBK conduct a
Dutch Auction for 15% of its outstanding shares. Mr. Seidman had proposed this
Dutch Auction and, in an Agreement with CBK, agreed to tender all the shares he
controlled into the auction and to execute a Standstill Agreement. The Dutch
Auction was oversubscribed and Mr. Seidman's shares were prorated in the same
manner as the other CBK shareholders.
In addition, Mr. Seidman and certian of the Reporting Persons requested in
connection with the Common Stock of Vista Bancorp, Inc. ("VBNJ") that the Board
be increased by one, a Seidman representative be placed on the Board, and that
VBNJ maximize shareholder value. The request was rejeacted by VBNJ. Mr. Seidman
and certain of the Reporting Persons conducted a proxy contest at the Annual
Meeting of Stockholders on April 26, 2001, seeking to elect three directors in
opposition to the three directors proposed by the management of VBNJ. The
reporting persons were not successful and the slate proposed by management was
elected.
In addition certain of the Reporting Persons conducted a proxy contest to (i)
revoke an amendment to the By-Laws of First Federal Savings and Loan of East
Hartford ("FFES"), and (ii) to amend two present provisions of the By-Laws of
FFES. The Reporting Persons were successful with respect to both issues. The
changes to the By-Laws were approved by the Office of Thrift Supervision on
August 11, 2000. In the latter part of 2000, Mr. Seidman requested that FFES
convene a Special Meeting of Shareholders to modify the By-Laws so that the
Board of Directors could be enlarged from ten to thirteen members. On November
27, 2000, Mr. Seidman and certain of the Reporting Persons entered into an
Agreement with FFES, whereby Mr. Seidman withdrew his request for a Special
Shareholders' Meeting and FFES agreed to enlarge its Board by one, and add Mr.
Seidman to the Board. In addition, there were other procedural requirements of
the Agreement which were complied with by FFES and Mr. Seidman. On February 8,
2001, FFES was sold to Connecticut Bancshares, Inc. for cash at $37.50 per share
for each FFES share. The transaction closed on August 31, 2001.
In addition, after Mr. Seidman in early March 2000 made a formal request to the
Board of Directors of Ambanc Holding Co., Inc. ("AHCI") to be added to the
Board, the size of the Board was increased and Mr. Seidman was added to the
Board. Mr. Seidman agreed to and did support the re-election of AHCI's slate of
directors at the Annual Meeting held on May 26, 2000. On September 4, 2001, AHCI
agreed to be sold to Hudson River Bancorp for $21.50 per share for all of AHCI's
outstanding shares.
In addition, the Reporting Persons' reserve the right to exercise any and all of
their respective rights as stockholders of the Issuer in a manner consistent
with their equity interests.
Except as set forth above, neither the Reporting Persons nor, to the best of the
Reporting Persons' knowledge, any executive officer or director of the Reporting
Persons, has any present plans or intentions which would result in or relate to
any of the transactions described in subparagraphs (b) through (j) of Item 4 of
Schedule 13D.
5. Interest in Securities of the Issuer
(a)(b)(c) As of the close of business on September 26, 2001, the Reporting
Persons owned beneficially an aggregate of 267,920 shares of Common Stock, which
constituted approximately 5.19% of the 5,154,576 shares of Common Stock
outstanding as of August 17, 2001, as disclosed in the Issuer's Form 10Q for the
period ended June 30, 2001.
Seidman, individually, in his capacity as the sole shareholder and officer of
the corporate general partner of SIP, SIPII, and as the Manager of Federal and
SAL, and as the general partner in PIP, and as the person with investment and
voting authority for SS, RMB and Kerrimatt, may be deemed to own beneficially
(as defined in Rule 13d-3 promulgated under the Exchange Act) the 251,300 shares
of Common Stock which constituted approximately 4.87% of the Issuer's
outstanding Common Stock owned individually, and by SS, RMB, SIP, SIPII, SAL,
PIP, Kerrimatt, and Federal. Mr. Pollack individually and as the person with the
investment and voting authority for his wife and children, and as a general
partner of PIP, may be deemed to own beneficially (as defined in Rule 13d-3
promulgated under the Exchange Act) 49,320 shares of Common Stock which
constituted approximately .956% of the Issuer's outstanding Common Stock. In
total the Reporting Persons have the right to vote and dispose of 267,920 shares
of Common Stock of the Issuer.
The schedule attached as Exhibit B describes transactions in the Common Stock
effected by the Reporting Persons. Except as set forth in this Item 5, none of
the Reporting Persons owns beneficially or has a right to acquire beneficial
ownership of any Common Stock, and except as set forth in this Item 5, none of
the Reporting Persons has effected transactions in the Common Stock during the
past sixty (60) days.
(d) N/A
(e) N/A
6. Contracts, Arrangements, Understandings or Relationships with Respect to
Securities of the Issuer.
Except as described herein neither the Reporting Persons nor to the best of
their knowledge, any of the persons named in Exhibit "A" attached hereto , has
any contract, arrangement, understanding or relationship (legal or otherwise)
with any person with respect to any securities of the Issuer, including, but not
limited to, transfer or voting of any securities, finders' fees, joint ventures,
loan or option arrangements, puts or calls, guarantees of profits, division of
profits or losses, or the giving or withholding of proxies.
A. The General Partner of SIP is: Veteri Place Corp; a New Jersey Corporation
(Seidman is the sole officer and shareholder). Seidman through Veteri Place
Corp. is entitled to 20% of the profits through Veteri Place Corp. (See Exhibit
C for Amended and Restated Agreement of Limited Partnership of Seidman
Investment Partnership, L.P.)
B. The General Partner of SIPII is: Veteri Place Corp; a New Jersey Corporation
(Seidman is the sole officer and shareholder). Seidman through Veteri Place
Corp. is entitled to 25% of the profits through Veteri Place Corp. (See Exhibit
D for Amended and Restated Agreement of Limited Partnership of Seidman
Investment Partnership II, L.P.)
C. Seidman is the Managing Member of SAL and Brant Cali is the Managing Member
of Seidcal Associates which owns a majority interest in SAL. Seidman is entitled
to a 5% of the profits earned by SAL (See Exhibit E for the Operating Agreement
for Seidman and Associates, L.L.C.)
D. Mr. Seidman has an agreement with Kerrimatt, L.P., which gives him the
complete discretion to vote and dispose of securities of the Issuer owned by
Kerrimatt, L.P. (Kerrimatt, L.P. presently owns 31,200 shares of the Issuer.)
Mr. Seidman is entitled to a percentage of the profits derived from these
securities, which is calculated after allowing a return to Kerrimatt, L.P.. (See
Exhibit F for the Letter Agreement.)
E. Mr. Seidman has an agreement with Federal which gives him the complete
discretion to vote and dispose of securities of the Issuer owned by Federal
(Federal presently owns 31,200 shares of the Issuer). Mr. Seidman is entitled to
a percentage of the profits derived from these securities which is calculated
after allowing a return to Federal. (See Exhibit G for the Operating Agreement
for Federal Holdings, LLC and the First and Second Amendment.)
F. Messrs. Seidman and Pollack are the General Partners of PIP and share the
investment and voting authority with respect to the shares owned by said entity.
They are entitled to receive an administrative fee equal to a quarter of 1% of
PIP's assets. (See Section 16 of the Partnership Agreemnt, Exhibit H attached
hereto and incorporated herein by reference.)
G. None of the partners of SIP, SIPII, PIP, Kerrimatt, affiliates of or members
of SAL, or SS, Pollack, Seidman, RMB or Federal, own any shares of Issuer except
as disclosed herein.
The following are certain provisions concerning the division of profits or
losses or guarantees of profits with reference to SAL, SIP, SIPII, PIP and
Federal. In Section 8.1(d) of the operating agreement for SAL, Mr. Seidman is
entitled to 5% of the net profits each year and his wife is entitled to 15% of
the net profits. In addition Section 11.3(b) in SAL's operating agreement
entitles Mr. Seidman to annual compensation of $300,000. Mr. Seidman is also
entitled to 20% of the net profits under the agreements with SIP [Section
9(a)(i)],and 25% of the net profits under the agreement with SIP II. [Section 9
(b)]]. Messrs. Seidman and Pollack are also entitled to 20% of the net profits
under the Agreement with PIP and they receive a management or administrative fee
based upon the total assets of PIP. Mr. Seidman also gets management or
administrative fees based upon the total assets of SIP, Federal and Kerrimatt.
In addition Mr. Seidman is also entitled to 25% of the Net Profits under the
Agreement with Federal (Second Amendment of the Operating Agreement).
Mr. Seidman is the Manager of Federal and SAL, and is the President of the
corporate general partner of SIP and SIPII, and investment manager for Kerrimatt
and, in that capacity, Mr. Seidman has the authority to cause those entities to
acquire, hold, trade and vote these securities. Messrs. Seidman and Pollack
share this responsibility with PIP. SAL, Federal, PIP, Kerrimatt, SIP and SIPII
were all created to acquire, hold and sell publicly traded securities. None of
the entities disclosed herein were formed to solely acquire, hold and sell the
Issuer's securities. Each of these entities owns securities issued by one or
more companies other than Issuer. The members and limited partners in Kerrimatt,
Federal, SAL, SIPII, SIP and PIP are all passive investors, who do not - and can
not - directly or indirectly participate in the management of these entities,
including without limitation proxy contests conducted by such entities.
Seidman's compensation is, in part, dependent upon the profitability of the
operations of these entities, but no provision is made to compensate Seidman
solely based upon the profits resulting from transactions from the Issuer's
securities.
The voting power over the Issuer's securities is not subject to any
contingencies beyond standard provisions for entities of this nature, (i.e.,
limited partnerships and limited liability companies) which govern the
replacement of a manager or a general partner.
Pursuant to Section 16 of the Amended and Restated Agreement of Limited
Partnership (Partnership Agreement), Veteri Place Corporation, as of the end of
each fiscal quarter shall be entitled to receive an administrative fee equal to
a quarter of 1% of SIP's assets. (See Section 16 of the Partnership Agreement
Exhibit C, attached hereto and incorporated herein by reference.)
The scheduled term of SIP is until December 1, 2014 unless sooner terminated as
provided in the Partnership Agreement. (See Term of Partnership, page 16 of the
Partnership Agreement, Exhibit C, attached hereto and incorporated herein by
reference.)
The scheduled term of SIPII is until December 31, 2014 unless sooner terminated
as provided in the Partnership Agreement. (See Term of Partnership, page 3 of
the Partnership Agreement, Exhibit D, attached hereto and incorporated herein by
reference.)
SAL's term shall continue in full force and effect until May 1, 2024 unless
terminated as provided for in its operating agreement. (See Article 4 - Term and
Duration, Exhibit E, attached hereto and incorporated herein by reference.)
Kerrimatt's term shall continue in full force and effect as provided in Letter
Agreement attached in Exhibit F. Pursuant to Paragraph 7 of the Letter
Agreement, Mr. Seidman is entitled to a quarterly administration fee equal to a
.25% of 1% of Kerrimatt assets.
Federal's term shall continue in full force and effect until April 30, 2045 as
provided for in its operating agreement. (See Article 4 - Term and Duration,
Exhibit G, attached hereto and incorporated herein by reference.) Pursuant to
Article 10.1 of the operating agreement, Mr. Seidman's management term expired
on June 30, 2000, but has continued pursuant to mutual agreement of the parties.
(See Article 10 and the Second Amendment to Operating Agreement, Exhibit G,
attached hereto and incorporated herein by reference.) Pursuant to Article 10.2
of the Operating Agreement, Mr. Seidman is entitled to a quarterly
administration fee equal to .25% of 1% of Federal's assets.
PIP's term shall continue in full force and effect until June 31, 2020, as
provided for in its Partnership Agreement. (See Article 5, Exhibit H, attached
hereto and incorporated herein by reference.)
7. Material to be filed as Exhibits
Exhibit A Executive Officers and Director of Reporting
Persons
Exhibit B Stock Purchase Transactions
Exhibit C Amended and Restated Agreement of
Limited Partnership of Seidman Investment
Partnership, L.P. and Amendment #1, #2,
and #3.
Exhibit D Amended and Restated Agreement of
Limited Partnership of Seidman Investment
Partnership II, L.P. and Amendment #1 and
#2.
Exhibit E Operating Agreement for Seidman and
Associates, L.L.C.with First Amendment
and Letter Agreement.
Exhibit F Letter Agreement with Kerrimatt, L.P.
Exhibit G Operating Agreement for Federal Holdings
L.L.C.
First Amendment to Operating Agreement and
Second Amendment to Operating Agreement.
Exhibit H Operating Agreement for Pollack Investment
Partnership, L.P.
First Amendment to Operating Agreement.
Exhibit I Joint Filing Agreement.
After reasonable inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
9/28/01 /ss/Lawrence B. Seidman
------ ------------------------------
Date Lawrence B. Seidman, Manager
Seidman and Associates, L.L.C.
9/28/01 /ss/Lawrence B. Seidman
------ ------------------------------
Date Lawrence B. Seidman, President
of the Corporate General Partner
Seidman Investment Partnership,L.P.
9/28/01 /ss/Lawrence B. Seidman
------ ------------------------------
Date Lawrence B. Seidman, President
of the Corporate General Partner
Seidman Investment Partnership II,
L.P.
9/28/01 /ss/Lawrence B. Seidman
------ ------------------------------
Date Lawrence B. Seidman, Individually
9/28/01 /ss/Lawrence B. Seidman
------ ------------------------------
Date Lawrence B. Seidman, Investment
Manager, Kerrimatt, L.P.
9/28/01 /ss/Lawrence B. Seidman
------ ------------------------------
Date Lawrence B. Seidman, Investment
Manager
Federal Holdings, L.L.C.
9/28/01 /ss/Lawrence B. Seidman
------ ------------------------------
Date Lawrence B. Seidman, Co-General
Partner, Pollack Investment
Partnership, L.P.
9/28/01 /ss/Dennis Pollack
------ ------------------------------
Date Dennis Pollack, Individually
9/28/01 /ss/Dennis Pollack
------ ------------------------------
Date Dennis Pollack, Co-General
Partner, Pollack Investment
Partnership, L.P.
EX-10.1
3
exhibita.txt
EXECUTIVE OFFICERS & DIRECTORS OF REPORT. PERSONS
EXHIBIT A
LAWRENCE B. SEIDMAN, INDIVIDUALLY
100 Misty Lane
Parsippany, New Jersey 07054
Principal occupation: Attorney and Consultant.
President, General Counsel and Director of Menlo Acquisition Corporation
Investment Employment principally conducted through Seidman & Associates, L.L.C.
(Manager), Seidman Investment Partnership, L.P.and Seidman Investment
Partnership II, LP (President of Corporate General Partner), Kerrimatt, LP
(Investment Manager), Pollack Investment Partnership, L.P. (Co-General Partner)
and Federal Holdings, LLC (Investment Manager)and Lawrence B. Seidman, Esq.
KEVIN S. MOORE
Clark Estates, Inc.
One Rockefeller Plaza
New York, NY 10020
Principal Occupation: Senior Vice President
Employment conducted through: Clark Estates,Inc.
ANGELA CALI KLOBY
11 Commerce Drive
Cranford, New Jersey 07016
Principal Occupation: Unemployed
Member of Seidcal & Associates, LLC
Seidcal & Associates, LLC is a Member of SAL
BRANT CALI
11 Commerce Drive
Cranford, New Jersey 07016
Principal Occupation: Private Real Estate Investor and Businessman
Member of Seidcal & Associates, LLC
Seidcal & Associates, LLC is a Member of SAL
CHRISTOPHER CALI
11 Commerce Drive
Cranford, New Jersey 07016
Principal Occupation: Part-Time Musician
Member of Seidcal & Associates, LLC
Seidcal & Associates, LLC is a Member of SAL
JOHN R. CALI
11 Commerce Drive
Cranford, New Jersey 07016
Principal Occupation:Private Real Estate Investor and Businessman
Member of Seidcal & Associates, LLC
Seidcal & Associates, LLC is a Member of SAL
JONNA CALI
11 Commerce Drive
Cranford, New Jersey 07016
Principal Occupation: Unemployed
Member of Seidcal & Associates, LLC
Seidcal & Associates, LLC is a Member of SAL
ROSE CALI
11 Commerce Drive
Cranford, New Jersey 07016
Principal Occupation: Unemployed
Member of Seidcal & Associates, LLC
Seidcal & Associates, LLC is a Member of SAL
DENNIS POLLACK
47 Blueberry Drive
Woodcliff Lake, NJ 07677
Principal Occupation: Businessman and private investor
President of MCB Mortgage Company, a division of Mohawk Community Bank and
President and CEO of Pegasus Funding Group, LLC
Co-General Partner of Pollack Investment Partnership, L.P.
Director of Menlo Acquisition Corp.
EX-10.2
4
insb.txt
STOCK PURCHASE TRANSACTIONS
SCHEDULE B
DATE PRICE PROCEEDS SHARES
Seidman & Assoc 12/1/99 10.3750 103,750.00 10,000
Seidman & Assoc 3/31/00 10.1250 75,937.50 7,500
Seidman & Assoc 10/25/00 12.4375 31,093.75 2,500
Seidman & Assoc 5/14/01 15.1000 30,200.00 2,000
Seidman & Assoc 5/24/01 14.9500 299,000.00 20,000
Seidman & Assoc 7/27/01 17.2000 51,600.00 3,000
Seidman & Assoc 9/20/01 17.9600 411,284.00 22,900
Sub-total 1,002,865.25 67,900
Seidman Inv. Partnership 12/22/99 10.0625 90,562.50 9,000
Seidman Inv. Partnership 8/18/00 11.9375 59,687.50 5,000
Seidman Inv. Partnership 8/28/00 12.0625 30,156.25 2,500
Seidman Inv. Partnership 10/25/00 12.4375 37,312.50 3,000
Seidman Inv. Partnership 5/24/01 14.9500 7,475.00 500
Seidman Inv. Partnership 9/20/01 17.9600 201,152.00 11,200
Sub-total 426,345.75 31,200
Seidman Inv. Partnership 12/7/99 10.0625 50,312.50 5,000
II
Seidman Inv. Partnership 12/22/99 10.0625 90,562.50 9,000
II
Seidman Inv. Partnership 5/24/01 14.9500 89,700.00 6,000
II
Seidman Inv. Partnership 9/20/01 17.9600 201,152.00 11,200
II
Sub-total 431,727.00 31,200
Federal Holdings 3/31/00 10.0000 11,000.00 1,100
Federal Holdings 11/3/00 12.6875 38,062.50 3,000
Federal Holdings 5/24/01 14.9500 237,705.00 15,900
Federal Holdings 9/20/01 17.9600 201,152.00 11,200
Sub-total 487,919.50 31,200
Kerri-Matt 12/9/99 10.0625 50,312.50 5,000
Kerri-Matt 12/22/99 10.0625 70,437.50 7,000
Kerri-Matt 1/12/00 10.4375 52,187.50 5,000
Kerri-Matt 5/24/01 14.9500 44,850.00 3,000
Kerri-Matt 9/20/01 17.9600 201,152.00 11,200
Sub-total 418,939.50 31,200
Pollack Invest Prtshp 1/18/01 13.3125 33,281.25 2,500
Pollack Invest Prtshp 5/18/01 15.5500 38,875.00 2,500
Pollack Invest Prtshp 5/24/01 14.9500 246,675.00 16,500
Pollack Invest Prtshp 9/20/01 17.9600 201,152.00 11,200
Sub-total 519,983.25 32,700
Seidman 1/19/00 10.4375 20,875.00 2,000
Seidman 5/24/01 14.9500 152,490.00 10,200
Seidman 9/20/01 17.9600 201,152.00 11,200
Seidman 9/26/01 17.81 18,073.93 1,000
Seidman 9/26/01 17.81 9,048.94 500
Seidman 9/26/01 17.81 18,077.93 1,000
Sub-total 419,717.80 25,900
Dennis Pollack 2/8/01 14.3750 28,875.00 2,000
Dennis Pollack 5/24/01 15.7500 15,810.00 1,000
Dennis Pollack 5/24/01 15.7500 6,329.25 400
Dennis Pollack 5/29/01 15.9500 16,010.00 1,000
Dennis Pollack 5/29/01 16.0000 25,701.25 1,600
Dennis Pollack 7/31/01 17.8900 17,950.00 1,000
Dennis Pollack 7/31/01 18.0000 5,423.25 300
Dennis Pollack 8/1/01 18.0500 38,031.00 2,100
Dennis Pollack 8/1/01 18.0200 18,085.25 1,000
Dennis Pollack 8/28/01 18.7000 5,628.00 300
Dennis Pollack 8/28/01 18.7500 18,810.00 1,000
Dennis Pollack 8/28/01 18.8000 13,207.25 700
Dennis Pollack 8/28/01 18.7000 11,295.00 600
Dennis Pollack 8/28/01 18.7500 1,892.75 100
Dennis Pollack 8/28/01 18.7000 6,605.25 350
Dennis Pollack 8/28/01 18.7000 7,446.75 395
Dennis Pollack 9/5/01 18.7500 28,220.25 1,500
Dennis Pollack 9/5/01 18.7000 7,064.63 375
Dennis Pollack 9/6/01 18.9000 17,105.25 900
Sub-total 289,490.13 16,620
TOTALS 3,996,988.18 267,920
EX-10.3
5
exc.txt
SEIDMAN INVESTMENT PARTNERSHIP, L.P. AGREEMENT
Exhibit C
AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
SEIDMAN INVESTMENT PARTNERSHIP, L.P.
JANUARY 5, 1995
AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
Table of Contents
1.
Definitions............................................................
(a) "Act".................................................
(b) "Affiliate"...........................................
(c) "Agreement"...........................................
(d) "Capital Account"....................................
(e) "Certificate".........................................
(f) "Code"................................................
(g) "Fiscal
Period"...............................................
(h) "Fiscal Quarter"......................................
(i) "Fiscal Year".........................................
(j) "General Partner Percentage".........................
(k) "Net Profit".........................................
(l) "Net Loss"........................................
(m) "Partnership Percentage".............................
2. Organization.................................................
3. Name of
Partnership...................................................
4. Principal Office, Resident Agent,
Registered Office.............................................
5. Term of the Partnerships......................................
6. Purposes......................................................
7. Contributions of the
Partners; New Partners.....................................
8. Capital
Accounts......................................................
9. Adjustments to Capital Accounts...............................
10. Hot Issues...................................................
11. Valuation.....................................................
12. Determination by General Partners of
Certain Matters...............................................
13. Liability of Partners.........................................
14. Rights and Duties of General Partner..........................
15. Expensess.....................................................
16. Administrative Fee............................................
17. Limitation on Power of Limited Partners.......................
18. Other Business
Ventures......................................................
19. Limitation on Assignability of Interests
of Limited
Partners......................................................
20. Withdrawals by the Limited Partners...........................
21. Withdrawal by the General Partner and
Affiliates....................................................
22. Dissolution and Winding Up of the
Partnership...................................................
23. Accounting and
Reports.......................................................
24. Books and
Records.......................................................
25. Indemnification...............................................
26. Amendment of Partnership Agreement............................
27. Notices.......................................................
28. Agreement Binding on Successors
and Assigns...................................................
29. Governing Law.................................................
30. Consents......................................................
31. Miscellaneous.................................................
AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP OF
SEIDMAN INVESTMENT PARTNERSHIP, L.P.
THIS AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP of Seidman
Investment Partnership, L.P. (the "Partnership"), dated as of January 5, 1995,
by and between Veteri Place Corporation, as the General Partner (the "General
Partner") and the persons and entities, referred to in schedule A on file at the
offices of the Partnership, who have executed, either directly or indirectly by
an attorney-in-fact, as limited partners (the "Limited Partners").
PREMISES:
A. The Partnership was organized in accordance with the New Jersey
revised Uniform Limited Partnership act by the filing by the General Partner of
a certificate of Limited Partnership with the office of the Secretary of State
of the State of New Jersey on----------------, 1995.
B. The General Partner, pursuant to the authority granted to him under
section 26 of the Agreement, desires to amend the Agreement and to restate the
same.
NOW THEREFORE, in consideration of the premises and the mutual
covenants hereinafter contained, effective as of February 15, 1995, it is hereby
agreed as follows:
The following terms shall have the following meaning when used in this
Agreement:
(a) "Act" shall mean the New Jersey Revised Uniform Limited
Partnership Act, amended from time to time.
(b) "Affiliate" shall mean any person performing services on
behalf of the Partnership who (i) directly or indirectly controls, is controlled
by, or is under common control with a General Partner; (ii) is any company of
which a General Partner or its controlling shareholder is an officer, director,
partner or trustee; (iii) a member of the family of the controlling shareholder
of the General Partner; or (iv) an Individual Retirement account or similar
trust for the benefit of one or more General Partner or its affiliates.
(c) "Agreement" shall mean this agreement of Limited
Partnership, as originally executed and as amended, modified, supplemented or
restated from time to time.
(d) "Capital account" shall mean the account described in
Section 8 of this Agreement.
(e) "Certificate" shall mean the Partnership's certificate of
Limited Partnership as defined in section 2 of this Agreement.
(f) "Code" shall mean the Internal Revenue code of 1986, or
successor provision of law, and the regulations issued thereunder.
(g) "Fiscal Period" shall mean the period beginning on the day
immediately succeeding the last day of the immediately preceding fiscal Period
and ending on the earliest occurring of the following:
(i) The last day of the Fiscal Year;
(ii) The day immediately preceding the day on which
a new Partner is admitted to the
Partnership;
(iii) the day immediately preceding the date on
which a Partner makes an additional capital
contribution to the Partner's capital account;
(iv) The day on which a Partner withdraws, in whole
or in part, the amount of his or its
Capital account;
(v) The date of dissolution of the Partnership in
accordance with Section 5 of this Agreement.
(h) "Fiscal "Quarter" shall mean a fiscal quarter of the
Partnership.
(i) "Fiscal Year" shall mean the fiscal year of the
Partnership, which shall be the calendar year.
(j) "General Partner Percentage" shall mean a percentage
established by the General Partner for each General Partner on the Partnership's
books as of the first day of each Fiscal Period. The sum of the General Partners
Percentages for each Fiscal Period shall equal one hundred percent (100%).
(k) "Net Profit" of the Partnership shall mean, with respect
to any Fiscal Period, the excess of the aggregate revenue, income and gains
(realized and unrealized) earned on an accrual basis during the fiscal Period by
the Partnership from all sources over the expenses and losses (realized and
unrealized) incurred on an accrual basis during the fiscal Period by the
Partnership.
(l) "Net Loss" of the Partnership shall mean, with respect to
any fiscal Period, the excess of all expenses and losses (realized and
unrealized) incurred on an accrual basis during the fiscal Period by the
Partnership over the aggregate revenue, income and gains (realized and
unrealized) earned on the accrual basis during the fiscal period by the
Partnership from all sources.
(m) "Partnership Percentage" shall mean a percentage
established for each partner on the Partnership' books as of the first day of
each Fiscal Period. The Partnership Percentage of a Partner for a Fiscal Period
shall be determined by dividing the amount of the Partner's capital account as
of the beginning of the Fiscal Period by the sum of the capital accounts of all
of the Partners as of the beginning of the fiscal Period. The sum of the
Partnership Percentage for each fiscal Period shall equal one hundred percent
(100%).
2. Organization.
The General Partner has executed a Certificate of Limited Partnership
pursuant to the provisions of the Act (the "Certificate") and has cause the
certificate to be filed as required by the Act. The General Partner shall also
execute and record all amendments to the Certificate or additional certificates
as may be required by this Agreement or by law.
3. Name of Partnership.
The name of the Partnership shall be Seidman Investment Partnership,
L.P. or such other name as the General Partner may from time to time designate.
4. Principal Office, Resident Agent, Registered Office.
The principal office of the Partnership is 1235A Route 23 South, Wayne,
New Jersey
or any other place determined by the General Partner. The Partnership's phone
number is (201) 633-7900. The name and address of the registered agent for
service of process in the State of New Jersey is Lawrence B. Seidman, 1235A
Route 23 South, Wayne, NJ 07470. The address of the registered office of the
Partnership in the State of New Jersey is c/o Lawrence B. Seidman, 1235A Route
23 South, Wayne, New Jersey 07470.
5. Term of the Partnership.
(a) The term of the Partnership, having commenced on the date the
Certificate was filed shall continue until the first of the following events
occurs:
(i) December 31, 2014;
(ii) a written consent to dissolution of the Partnership by
all Partners;
(iii) upon all of the General Partners ceasing to be general
partners as a result of doing or being subject to one or more of the following:
(A) withdrawing from the Partnership in accordance
with Section 21 of this Agreement;
(B) assigning all of its interest in the
Partnership;
(C) making an assignment for the benefit of its
creditors;
(D) filing a voluntary petition in bankruptcy;
(E) being adjudged bankrupt or insolvent or having
entered against it an order of relief in any bankruptcy or insolvency
proceeding;
(F) filing a petition or answer seeking for itself
any reorganization, arrangement,composition, readjustment, liquidation,
dissolution, or similar relief under any statute, law, or regulation;
(G) filling an answer or other pleading admitting
or failing to contest the material allegations of a petition filed
against it in any proceeding seeking reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or similar relief under
any statute, law or regulation;
(H) seeking consenting to, or acquiescing in the
appointment of a trustee or receiver, or liquidator of all or any substantial
part of its properties;
(I) being the subject of any proceeding seeking
reorganization, arrangement, composition, readjustment, liquidation,
dissolution, or similar relief under any statute, law or regulation, which
proceeding shall have continued for one hundred and twenty (120) days
after the commencement thereof; or the appointment of a trustee, receiver,
or liquidator for such General Partner or all or any substantial part of it
properties without its consent or acquiescence, which appointment is not
vacated or stayed for ninety (90) days after the expiration of the stay during
which period the appointment is not vacated;
(J) the death of a General Partner; or
(K) the entry by a court of competent jurisdiction
adjudicating such General Partner incompetent to manage his person or his
property; or
(iv) upon issuance of a non-appealable decree of dissolution
of the Partnership by a New Jersey Court of competent jurisdiction.
(b) In the event a General Partner does or becomes subject to any of
the provisions of subsection (a)(iii) of this Section 5, the remaining General
Partner shall be permitted to carry on the business of the Partnership upon
written notice provided to all Partners of the decision to continue the
Partnership's business. Each Limited Partner shall have the right for a period
of thirty (30) days from the date of the written notice (the "Election Period")
to elect to withdraw from the Partnership as of ten (10) days after the last day
of the Election Period. The Limited Partner will receive the proceeds of a
withdrawal made pursuant to this subsection (b) within ninety (90) days of the
date of withdrawal. The amount of such proceeds will be calculated after the
adjustments to his capital account provided for in Section 9 hereof, made as if
the withdrawal date were the end of a Fiscal Year.
(c) If any one or more of the termination events listed in this Section
5 occurs, and if the remaining General Partner chooses not to carry on the
business of the Partnership in accordance with the provisions of subsection (b)
of this Section 5, the Partnership shall be dissolved and its affairs wound up
as provided in Section 22 of this Agreement.
6. Purposes
The Partnership is organized for the following purposes:
(a) to invest and trade, on margin or otherwise, in "Securities," as
that term is defined in Section 2(1) of the Securities Act of 1933, as amended
(the "1933 Act");
(b) to sell Securities short and cover short sales;
(c) to lend funds or properties of the Partnership, either with or
without security; and
(d) to execute, deliver and perform all contracts and other
undertakings, and engage in all activities and transactions, that the General
Partner believes is necessary or advisable in carrying out the purposes
specified all subsections (a), (b), and (c) of this Section 6, including without
limitation:
(i) to purchase, transfer or acquire in any manner and
exercise all rights, powers, privileges and other incidents of ownership or
possession with respect to the investments described in subsection (a) of this
Section 6; and
(ii) to register or qualify the Partnership under any
applicable Federal or state laws, or to obtain exemptions under those laws, if
registration qualification or exemption is deemed necessary by the General
Partner.
7. Contributions of the Partners; New Partners.
(a) Each Partner shall make a contribution to the Partnership's capital
("Capital Contribution") in the amount set out opposite the Limited Partner's
name in Schedule A attached to this Agreement.
(b) Any Partner may elect, with the consent of the General Partner to
make an additional Capital Contribution, as of the first day of any fiscal
Quarter. The General Partner may, in its sole discretion, permit additional
Capital Contributions to be made more frequently than quarterly.
(c) No Partner shall be required to make any additional Capital
Contributions.
(d) Capital Contributions made by Limited Partners must be in cash.
(e) The General Partner shall have the right, but not the obligation,
to admit new Partners to the Partnership as of the first day of any Fiscal
quarter. The General Partner may, however, in its sole discretion, admit new
Partners more frequently than quarterly.
8. Capital Accounts.
A Capital account shall be established for each Partner. For the Fiscal
Period during which a Partner is admitted to the Partnership, his or its capital
account shall equal the amount of his or its initial Capital Contribution. For
each subsequent Fiscal Period, the Partner's Capital account will equal the sum
of the amount of his or its Capital account as finally adjusted for the
immediately preceding fiscal Period and the amount of any additional Capital
Contribution made by the Partner as of the first day of the current Fiscal
Period.
9. Adjustments to Capital Accounts.
At the end of each Fiscal Period, the Capital Accounts of the Partners
shall be adjusted in the following manner:
(a) Subject to the provisions of subsections (c) and (d) and (f) of
this Section 9, Net Profit of the Partnership for the Fiscal Year shall be
credited as follows:
(i) Twenty percent (20%) of the Net Profit shall be
reallocated to the General Partner for each Fiscal
Year as a "Incentive Allocation".
(ii) The remaining Net Profit shall be allocated to the
Partners in proportion to their Capital Accounts.
(b) Net Loss of the Partnership for the Fiscal Year shall be debited
against the Capital Account of each Partner in proportion to and in accordance
with the balance in the Capital Account of the Partner until the value of any
Partners' Capital account becomes zero. Thereafter, any remaining Net Loss for
the Fiscal Year shall be debited to Partners having positive balances in their
Capital accounts in proportion to those balances, until the value of each
Partner's Capital Account becomes zero. Thereafter, any remaining Net Loss for
the Fiscal Year shall be debited to the General Partner in accordance with each
General Partner's General Partner Percentage for the Fiscal Period.
(c) In the event that the Capital Account of one or more General
Partner has a negative balance, one hundred percent (100%) of the Net Profit of
the Partnership for the Fiscal Period shall be credited to those General
Partners whose Capital Accounts have negative balances in accordance with their
respective General Partner Percentages until no General Partner shall have a
negative Capital Account balance.
(d) Anything in this Section 9 to the contrary notwithstanding, if any
Net Losses are allocated to the account of any Limited Partner, each such
Limited Partner shall be entitled to a "Recoupment Allocation" of subsequent Net
Profits of the Partnership, in an amount in proportion to his Partnership
Percentage, until such Net Loss shall have been eliminated. The amount of Net
Profits allocated as a Recoupment Allocation shall not exceed, but shall reduce,
the amount of Net Profits otherwise allocable to the General Partners as the
Incentive Allocation pursuant to Section 9(a) (ii) hereof. If a Limited Partner
who is entitled to a Recoupment Allocation shall withdraw any portion of his
Capital Account, the amount of Recoupment Allocation to which he is entitled
shall be reduced in proportion to the amount of capital withdrawn.
(e) The amount of any withdrawal made by the Partner pursuant to
Section 21 or Section 22 of this Agreement shall be debited against the Capital
Account of that Partner.
(f) Allocations of Net Profit or Net Loss for a Fiscal Period, if
necessary, shall be made in accordance with each Partner's Partnership
percentage, adjusted as provided in paragraph (a) of this Section 9 at the end
of the Fiscal Year, provided that the "Incentive Allocation" may not exceed
twenty percent (20%) of the Net Profit for the Fiscal Year.
10. Hot Issues.
In the event the General Partner decides to invest in securities which
are the subject of a public distribution and which the General Partner, in his
sole discretion, believes may become a "hot issue" as that term is defined in
Article III, Section 1 of the Rules of Fair Practice of the National Association
of Securities Dealers, Inc. (the "Association"), such investment shall be made
in accordance with the following provisions:
(a) any such investment made in a particular Fiscal Period shall be
made in a special account (the "Hot Issues account");
(b) only those Partners who do not fall within the proscription of
Article III, section 1 of said Rules of Fair Practice ("Unrestricted Partners")
shall have any beneficial interest in the Hot Issues Account;
(c) each Unrestricted Partner shall have a beneficial interest in the
Hot Issues Account for any Fiscal Period in the proportion which (i)a such
Unrestricted Partner's Capital account as of the beginning of the Fiscal Period
bore to (ii) the sum of the Capital Accounts of all Unrestricted Partners as of
the beginning of such fiscal Period.
(d) Funds required to make a particular investment shall be transferred
to the Hot Issues account from the regular account of the Partnership;
securities involved in the public distribution shall be purchased in the Hot
Issues Account, held in the Hot Issues Account and eventually sold from the Hot
Issues Account or transferred to the regular account at fair market value as of
the day of transfer as determined by the General Partner with such transfer
being treated as a sale; if such securities are sold from the Hot Issues
account, the proceeds of the sale shall be transferred from the Hot Issues
account to the regular account of the Partnership.
(e) as of the last day of each Fiscal Period in which a particular
investment or investments are held in the Hot Issues Account: (A) interest shall
be debited to the Capital Accounts of the Unrestricted Partners in accordance
with their beneficial interest in the Hot Issues Account at the interest rate
being paid by the Partnership from time to time for borrowed funds during the
period in that Fiscal Period that funds from the regular account have been held
in or made available to the particular Hot Issues Account or, if no such funds
are being borrowed during such period, the interest rate that the General
Partner determines would have been paid if funds had been borrowed by the
Partnership during such period; and such interest shall be credited to the
Capital Accounts of all the Partners, both General and Limited, in the
proportions which (i) each Partner's Capital Account as of the beginning of such
Fiscal Period bore to (iii) the sum of the Capital accounts of all Partners as
of the beginning of such Fiscal Period and (B) any Net Profits or Net Losses
during such Fiscal Period with respect to the Hot Issues Account shall be
allocated to the Capital accounts of the Unrestricted Partners in accordance
with their beneficial interest in the Hot Issues Account during such Fiscal
Period; provided, however, that the amount of such interest shall not exceed the
amount of profit accrued in the Hot Issues Account; and
(f) the determination of the General Partners as to whether a
particular Partner falls within the proscription of Article III, Section I of
said Rules of Fair Practice shall be final.
11. Valuation.
The Partnership's assets shall be valued in accordance with the
following principles:
(a) Any Security that is listed on a national securities exchange will
be valued at its last sale price on the date of determination as recorded by the
composite tape system, or if no sales occurred on that day, at the mean between
the closing "bid" and "asked" prices on that day as recorded by the system or
the exchange, as the case may be;
(b) Any Security that is a National Market Security will be valued at
its last sale price on the date of determination as reported by the National
Association of Securities dealers automated quotations system ("NASDAQ") or if
no sale occurred on that day, at the mean between the closing "bid" and "asked"
prices on that day as reported by NASDAQ:
(c) Any Security not listed on a national securities exchange and not a
National Market Security will be valued at the mean between the closing "bid"
and "asked" prices on the date of determination as reported by NASDAQ or, if not
so reported, as reported in the over-the-counter market in the United States;
(d) An option shall be valued at the last sales price or, in the
absence of a last sales price, the last offer price; and
(e) All other Securities shall be assigned the value that the General
Partner in good faith determine.
12. Determination by General Partner of Certain Matters.
(a) All matters concerning the valuation of Securities, the allocation
of profits, gains and losses among the Partners, including the taxes on them and
accounting procedures, not specifically and expressly provided for by the terms
of this Agreement, shall be determined in good faith by the General Partner,
whose determination shall be final, binding and conclusive upon all of the
Partners.
(b) gains, losses, and expenses of the Partnership for each Fiscal
Period shall be allocated among the Partners for income tax purposes in a manner
so as to reflect, as nearly as possible, the amounts credited or charged to each
Partner's Capital Account pursuant to Section 9 of this Agreement.
(c) The General Partner shall have the power to make all tax elections
and determinations for the Partnership, and to take any and all action necessary
under the Code or other applicable law to effect those elections and
determinations. All such elections and determinations by the General Partner
shall be final, binding and conclusive upon all Partners.
13. Liability of Partners.
(a) The General Partner shall not be obligated to contribute cash or
other assets to the Partnership to make up deficits in their Capital accounts or
in the Capital Accounts of the Limited Partners either during the term of the
Partnership or upon liquidation. The General Partner shall be liable for all
debts and obligations of the partnership to the extent that the Partnership is
unable to pay such debts and obligations up to the extent of Veteri's capital.
(b) The doing of any act or the failure to do any act by a General
Partner, the effect of which may cause or result in loss, liability, damage or
expense to the Partnership or any Partner shall not subject a General Partner to
any liability to the Partnership or to any Partner, except that a General
Partner may be so liable if it has not acted in good faith, or has committed
gross misconduct or was grossly negligent.
(c) A Limited Partner will not be liable for any debts or bound by any
obligations of the Partnership except to the extent set forth in subsections
(d), (e) and (f) of this Section 13.
(d) A Limited Partner who has received the return of any part of his or
its Capital contribution without violation of this Agreement or the Act shall
not therefore be labile to the Partnership or its creditors.
(e) A Limited Partner receiving a return of any portion of his or its
Capital Contribution in violation the Act or this Agreement will be Liable to
the Partnership for a period of six (6) years thereafter for the amount of the
contribution wrongfully returned.
(f) A Limited Partner may be liable to the Partnership or creditors of
the Partnership for any amounts distributed if, and to the extent that, at the
time of the distribution, he actually knew that, after giving effect to the
distribution, all liabilities of the Partnership, other than liabilities to
Partners on account of their interest in the Partnership, exceeded the fair
value of the Partnership's assets.
14. Rights and Duties of the General Partner
(a) The General Partner shall have the exclusive right to manage and
control the affairs of the Partnership, and shall have the power and authority
to do all things necessary or proper to carry out the purposes of the
Partnership. The General Partner shall devote an amount of time and attention
that the General Partner in its sole discretion deems necessary or appropriate.
(b) Without limiting the generality of the foregoing, the General
Partner shall have full power and authority:
(i) to engage independent agents, investment advisors,
attorneys, accountants and custodians as the General Partner deems necessary or
advisable for the affairs of the Partnership;
(ii) to receive, buy sell, exchange, trade, and otherwise
deal in and with Securities and other property of the Partnership;
(iii) to open, conduct and close accounts with brokers on
behalf of the Partnership and to pay the customary fees and charges applicable
to transactions in those accounts;
(iv) to open, maintain and close accounts, including margin
accounts, with brokers and banks, and to draw checks and other orders for the
payment of money by the Partnership;
(v) to file, on behalf of the Partnership, all required
local, state and Federal tax and other returns relating to the Partnership;
(vi) to cause the Partnership to purchase or bear the cost of
any insurance covering the potential liabilities of the General Partner and any
associate, employee or agent of the General Partner arising out of the General
Partner's actions as General Partner under this Agreement;
(vii) to cause the Partnership to purchase or bear the cost of
any insurance covering the potential liabilities of any person serving as a
director, officer or employee of an entity in which the Partnership has an
investment or of which the Partnership is a creditor;
(viii) to commence or defend litigation or submit to
arbitration any claim or cause of action that pertains to the Partnership or any
Partnership assets;
(ix) to enter into, make and perform contracts, agreements and
other undertakings, and to do any other acts, as the General Partner deems
necessary or advisable for, or as may be incidental to, the conduct of the
business of the Partnership, including, without limiting the generality of the
foregoing, contracts, agreements, undertakings and transactions with any Partner
or with any other person, firm or corporation having any business, financial or
other relationship with any Partner or Partners:
(x) to make or revoke elections pursuant to Section 754 of the
Code to adjust the basis of the Partnership's property as permitted by Sections
734(b) and 743(b) of the Code; and
(xi) to designate a Tax Matters Partner for all purposes
under the Code.
15. Expenses.
The Partnership shall bear all expenses relating to its organization.
The Partnership will bear the expenses of its administration, accountant, its
legal counsel, and expenses of investments.
16. Administrative Fee.
The Partnership shall pay the General Partner as of the end of each
Fiscal Quarter of the Partnerhship an administrative fee at an annual rate equal
to 1% of the value of the Partnership's assets.
17. Limitation on Powers of Limited Partners.
No Limited Partner shall participate in the control of the
Partnership's business, transact any business in the Partnership's name or have
the power to sign documents for the Partnership or to bind the Partnership in
any other way.
18. Other Business ventures.
Each Partner agrees that each General Partner and its affiliates and
associates may engage in other business activities or possess interest in other
business activities of every kind and description, independently or with others.
These activities may include, without limitation, establishing a broker-dealer
and investing in real estate and real estate related partnerships, or in
investing, in financing, acquiring and disposing of interest in securities in
which the Partnership may from time to time invest, or in which the Partnership
is able to invest or otherwise have any interest. The Limited Partners agree
that the General Partner and its affiliates may act as general partner of other
partnerships, including investment partnerships.
19. Limitation on Assignability of Interest of Limited Partners.
(a) No Limited Partner may assign or otherwise transfer or encumber his
or its interest in the Partnership, in whole or in part, without the consent of
the General Partner and without a written opinion of counsel to or approved by
the General Partner that the proposed transfer (i) is consistent with all
applicable provisions of the 1933 Act, and the rules and regulations thereunder,
as from time to time in effect, as well as any applicable provisions of any
state "blue sky" law; and (ii) would not result in the Partnership's having to
register as an investment company under the Investment Company Act of 1940, as
amended.
(b) Notwithstanding any other provision of this Agreement, any
successor to any Limited Partner shall be bound by the provisions of this
Agreement. Prior to recognizing any assignment of an interest in the Partnership
that has been transferred in accordance with this Section 19, the General
Partner may require the transferring Limited Partner to execute and acknowledge
an instrument of assignment in form and substance satisfactory to the General
Partner, and may require the assignee to agree in writing to be bound by all the
terms and provisions of this Agreement, to assume all of the obligations of the
assigning Limited Partner and to execute whatever other instruments or documents
the General Partner deems necessary or desirable in connection with the
assignment.
(c) No Limited Partner shall have the right to have his or its assignee
admitted as a substitute Limited Partner, except upon the written consent of the
General Partner, which consent may be withheld in the sole discretion of the
General Partner.
(d) Each Limited Partner hereby approves of the admission to the
Partnership as a Limited Partner of any assignee who succeed to the interest in
the Partnership of a Limited Partner in accordance with the provisions of this
Section 19.
20. Withdrawals by a Limited Partner.
(a) (i) A Limited Partner who shall have been a Limited Partner for at
least eight full Fiscal Quarters shall have the right, as of the end of any
Fiscal Year, or at other times at the discretion of the General Partner, to
withdraw all or a portion of the amount of his or its Capital Account, so long
as the General Partner receives written notice of the intended withdrawal not
less than one hundred eighty (180) days prior to the withdrawal, stating the
amount to be withdrawn. In no event, however, shall a Limited Partner be
permitted to withdraw any amounts from his or its Capital Account in excess of
the positive balance of his or its Capital Account. If the amount of a Limited
Partner's withdrawal represents less than seventy-five (75%) of the Limited
Partner's Capital Account, the Limited Partner will receive the proceeds of the
withdrawal within thirty (30) days after the date of withdrawal. If the amount
of a Limited Partner's withdrawal represents seventy-five (75%) or more of the
Limited Partner's Capital Account, the Limited Partner will receive seventy-five
percent (75%) of his Capital account within thirty (30) days after the date of
withdrawal and the remainder of the amount withdrawn within ten (10) days after
the Partnership has received financial statements from its independent certified
public accountants pursuant to Section 23(c) of this
Agreement. If a Limited Partner requests withdrawal of capital which would
reduce his Capital Account below the amount of his initial Capital Contribution,
the General Partner may treat such request as a request for withdrawal of all of
such Partner's Capital Account. The distribution of any amount withdrawn by a
Limited Partner may take the form of cash and/or marketable securities as
determined by the General Partner in his sole discretion.
(ii) In the event of a proposed withdrawal of capital by one
or more General Partner or Affiliates pursuant to Section 21(a)(ii) of this
Agreement, as a result of which the aggregate of the Capital Accounts of the
General Partner and Affiliates will be less than $50,000 (fifty thousand
dollars), a Limited Partner shall have the right to withdraw all or a portion of
the amount of his or its Capital Account, so long as the General Partner
receives written notice of the intended withdrawal not more than fifteen (15)
days after the date of the notice of withdrawal by such General Partner or
General Partner or Affiliate or Affiliates pursuant to said Section 21(a)(ii),
stating the amount to be withdrawn. In such event the withdrawal by such Limited
Partner shall be effective as of the effective date of the withdrawal by the
General Partner or General Partners pursuant to said Section 21(a)(ii). The
amount available for withdrawal shall be calculated in the same manner as
provided for in the last sentence of paragraph (b) of Section 5 hereof.
(b) Any Limited Partner's interest in the Partnership may be terminated
by the Partnership as of the end of any Fiscal Year upon prior written notice,
so long as the General Partner determines the termination to be in the best
interest of the Partnership. In the event that a Limited Partner's interest in
the Partnership is terminated pursuant to this Section 20, the Limited Partner
shall receive ninety percent (90%) of the value of his Capital Account within
one hundred eighty (180) days after written notice of termination is given by
the Partnership and the remaining ten percent (10%) within ten (10) business
days after receipt by the Partnership of financial statements with respect to
the Fiscal Year in which his or its interest in the Partnership is terminated.
21. Withdrawals by the General Partners and Affiliates.
(a) (i) Each General Partner shall have the right to withdraw any
amount of cash from his Capital Account as of the end of any Fiscal Year,
without prior notification to the Limited Partners, provided that, after giving
effect to such withdrawal, the aggregate Capital accounts of the General
Partners and their Affiliates are not less than $50,000 (fifty thousand
dollars).
(ii) Upon forty-five (45) days ' prior notice to the Limited
Partners, a General Partner or an Affiliate may withdraw any amount from his
Capital Account contributed to the Partnership as a result of which withdrawal
the aggregate Capital Accounts of the General Partner and their Affiliates would
be reduced below $50,000. (fifty thousand dollars).
(b) Any or all of the General Partners may voluntarily resign or
withdraw from the Partnership as of the end of any Fiscal Year upon sixty (60)
days' written notice sent to all Partners.
22. Dissolution and Winding Up of the Partnership.
On dissolution of the Partnership, the General Partners or if there is
no General Partner, one or more persons approved by Limited Partners holding a
majority in interest of the Capital Accounts of the Limited Partners) shall wind
up the Partnership's affairs and shall distribute the Partnership's assets in
the following manner and order:
(a) in satisfaction of the claims of all creditors of the Partnership,
other than the General Partners;
(b) in satisfaction of the claims of the General Partners as creditors
of the Partnership; and
(c) any balance to the Partners in the relative proportions that their
respective Capital Accounts bear to each other, those Capital Accounts to be
determined as if the Fiscal Year ended on the date of the dissolution.
23. Accounting and Reports.
(a) The records and books of account of the Partnership shall be
reviewed as of the end of each fiscal Year by independent certified public
accountants selected by the General Partner in his sole discretion.
(b) As soon as practicable after the end of each Fiscal Year, the
General Partner shall cause to be delivered to each person who was a Partner at
any time during that Fiscal Year all information deemed necessary by the General
Partner in his sole discretion for the preparation of the Partner's income tax
returns, including a Form 1065/Schedule K-1 statement showing the Partner's
share of Net Profit or Net Loss, deductions and credits for the year Federal
income tax purposes, and the amount of any distributions made to or for the
account of the Partner pursuant to this Agreement.
(c) The independent certified public accounts selected by the General
Partner in accordance with subsection (a) of this Section 23 shall prepare and
mail to each Partner, within ninety (90) days after the end of each fiscal Year,
an income statement for the Fiscal Year and a balance sheet as of the end of the
Fiscal Year.
(d) The Partnership shall cause to be prepared and mailed to each
Partner a report setting out as of the end of each fiscal quarter information
determined by the General Partner to be appropriate.
(e) The General Partner shall cause tax returns for the Partnership to
be prepared and timely filed with the appropriate authorities.
24. Books and Records.
The General Partner shall keep at the Partnership's principal office:
(a) books and records pertaining to the Partnership's business showing
all of its assets and liabilities, receipts and disbursements, realized profits
and losses, Partners' Capital Accounts and all transactions enter into by the
Partnership;
(b) a current list of the full name and last known home, business or
mailing address of each Partner set out in alphabetical order;
(c) a copy of the Certificate and all amendments to it, together with
executed copies of any powers of attorney pursuant to which the Certificate and
any amendments to it have been executed;
(d) copies of the Partnership's Federal, state and local income tax
returns and reports, if any, for the three (3) most recent years; and
(e) copies of this Agreement as may be amended from time to time.
All books and records of the Partnership required to be kept under this
Section 24 shall be available for inspection by a Partner of the Partnership at
the offices of the Partnership during ordinary business hours for any purpose
reasonably related to the Partner's interest as a Partner in the Partnership.
25. Indemnification.
(a) The Partnership shall indemnify each General Partner and any of his
Affiliates (each an "Indemnitee") to the fullest extent permitted by law and
will hold each harmless from and with respect to (i) all fees, costs and
expenses incurred in connection with, or resulting from, any claim, action or
demand against any indemnitee that arises out of or in any way relates to the
Partnership, its properties, business or affairs, and (ii) any losses or damages
resulting from any such claim, action or demand, including amounts paid in
settlement or compromise of the claim, action or demand.
(b) No Indemnitee shall be indemnified by the Partnership with respect
to any action or failure to act that does not constitute good faith, or that
constitutes willful misfeasance.
(c) The Partnership may pay the expenses incurred by an Indemnitee in
defending a civil or criminal action, suit or proceeding brought by a party
against the Indemnitee that arises out of or is in any way related to the
Partnership, its properties, business or affairs, upon receipt of an undertaking
by the Indemnitee to repay the amount advanced by the Partnership if an
adjudication or determination is subsequently made by a court of competent
jurisdiction that the Indemnitee is not entitled to indemnification as provided
in this Agreement.
(d) The right of indemnification provided in this Section 25 shall be
in addition to any rights to which an Indemnitee may otherwise be entitled and
shall inure to the benefit of the executors, administrators, personal
representatives, successors or assigns of each Indemnitee.
(e) The rights to indemnification and reimbursement provided for in
this Section 25 may be satisfied only out of the assets of the Partnership. No
Partner shall be personally liable for any claim for indemnification or
reimbursement under this Section 25.
26. Amendment of Partnership Agreement.
This Agreement may be amended, in whole or in part, by the written
consent of (a) the General Partner, and (b) Partners the value of whose Capital
Account constitute not less than fifty percent (50%) of the total value of all
Capital Accounts of the Partnership, provided that no such amendment shall
affect the allocation of Net Profit or Net Loss to any Partner who has not
consented to such amendment. In addition, any provision of this Agreement, other
than Section 9, may be amended by the General Partner in any manner that does
not, in the sole discretion of the General Partner, adversely affect any Limited
Partner.
27. Notices.
Notices that may or are required to be given under this Agreement by
any part to another shall be in writing and deposited in the United States mail,
certified or registered, postage prepaid, addressed to the respective parties at
their addresses set out in Schedule A to this Agreement or to any other
addressee designated by any Partner by notice addressed to the Partnership in
the case of any Limited Partner and to the General Partner in the case of the
General Partners. Notices shall be deemed to have been given when deposited in
the United States mail within the continental United States.
28. Agreement Binding Upon Successors and Assigns.
This Agreement shall inure to the benefit of and shall be binding upon
the heirs, executors, administrators or other representatives, successors and
assigns of the Partners.
29. Governing Law.
This Agreement, and the rights of the Partners under it, shall be
governed by and construed in accordance with the law of the State of New Jersey.
30. Consents.
Any and all consents, agreements or approvals provided for or permitted
by this Agreement shall be in writing and signed copies of them shall be filed
and kept with the books of the Partnership.
31. Miscellaneous.
(a) This Agreement, including Schedule A appended to it, constitutes
the entire understanding and Agreement of the Partners as to the operation of
the Partnership.
(b) This agreement may be executed in counterparts, each of which
shall be deemed to be an original.
(c) Each provision of this Agreement is intended to be severable. A
determination that a particular provision of this Agreement is illegal or
invalid shall not affect the validity of the remainder of the Agreement.
(d) Nothing contained in this Agreement shall be construed to
constitute any Partner the agent of another Partner, except as specifically
provided in this Agreement, or in any manner to limit the partners in the
carrying on of their own respective business or activities.
(e) If there is a conflict between the terms and conditions of the
Partnership Agreement and Offering Memorandum, the Partnership Agreement shall
be controlling.
IN WITNESS WHEREOF, the Partners have executed this Agreement as of the
date first above written.
GENERAL PARTNER
VETERI PLACE CORPORATION
By:/s/Lawrence B. Seidman, President
LIMITED PARTNERS:
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 delivered to the General Partner.
LAWRENCE B. SEIDMAN
Attorney-in-Fact
/s/Lawrence B. Seidman
AMENDMENT #1
TO LIMITED PARTNERSHIP
CERTIFICATE OF
SEIDMAN INVESTMENT PARTNERSHIP, L.P.
Section 1 The Name of the Partnership is Seidman Investment
Partnership, L.P., which was filed with the Secretary of State on
January 17, 1995.
Section 6 Section 6 is hereby amended to add the following people and entities
as limited partners:
NAME CAPITAL CONTRIBUTION
James J. Gallagher, Ph.D,
TTEE Gallagher Living
Trust DTD 11/30/92
3636 Paradise dr.
Tiburon, CA 94920 $200,000.00
Robert Kaplus, G.P.
Kaplus Hanover Associates
4 Pewter Lane
New Providence, NJ 07974 $125,000.00
Russ Ketron, TTEE
The Ketron Family Trust DTD 10/20/89
33 San Miguel Way
Novato, CA 94945 $50,000.00
Louis M. Rogow, M.D. &
Enid Z. Rogow
P. O. Box 57
211 Post Rd.
Bernardsville, NJ 07924 $100,000.00
Seidman and Associates, L.L.C. $100,000.00
100 Misty Lane
Parsippany, NJ 07054
VETERI PLACE CORPORATION
Dated: November 21, 1996 By:
/s/Lawrence B. Seidman, President
STATE OF NEW JERSEY )
)ss:
COUNTY OF MORRIS )
On the 21 day of November, 1996, before me personally came Lawrence B.
Seidman, to me known, who, being by me sworn, did depose and say that he resides
at 19 Veteri Place, Wayne, New Jersey 07470, that he is the President of Veteri
Place Corporation described in and which executed the above instrument; and that
he signed such instrument by order of the Board of Directors of said
Corporation.
/s/ Ruth W. Rivkind
A Notary Public of the
State of New Jersey
My Commission Expires
February 14, 2001
AMENDMENT #2
TO LIMITED PARTNERSHIP
CERTIFICATE OF
SEIDMAN INVESTMENT PARTNERSHIP, L.P.
FILED JANUARY 17, 1995
Section 1 The Name of the Partnership is Seidman Investment
Partnership, L.P., which was filed with the Secretary of State on
January 17, 1995 and Amendment #1 was filed on November 25, 1996.
Section 6 Section 6 is hereby amended to add the following
people and entities as limited partners:
NAME CAPITAL CONTRIBUTION
Richard Greenberg
100 Misty Lane
Parsippany, NJ 07054 $250,000.00
Robert Kessler
40 Warren St.
Paterson, NJ 07524 $100,000.00
Marci Parejo Irrevocable Trust $125,000.00
Sharon E. Sigesmund Trustee U/A/D9/10/92
2859 Queens Courtyard Dr.
Las Vegas,NV 89109
Ross Zeltzer Irrevocable Trust $125,000.00
Sharon E. Sigesmund Trustee U/A/D9/10/92
2859 Queens Courtyard Dr.
Las Vegas,NV 89109
SECTION 6 Section 6 is hereby amended to revise the amount of
Capital Contribution for the following people and entities as limited
partners:
James J. Gallagher, Ph.D. $300,000.00
Gallagher Family Limited
Partnership #1
3636 Paradise Dr
Tiburon, CA 94920
Robert Kaplus, G.P. $150,000.00
Kaplus Hanover Associates
4 Pewter Lane
New Providence, NJ 07974
Russ Ketron, TTEE $120,000.00
The Ketron Family Trust DTD 10/20/89
33 San Miguel Way
Novato, CA 94945
Louis M. Rogow, M.D. & $200,000.00
Enid Z. Rogow
P. O. Box 57
211 Post Rd.
Bernardsville, NJ 07924
VETERI PLACE CORPORATION
Dated: September 8, 1998 By:
/s/Lawrence B. Seidman, President
Veteri Place Corporation
Certificate of Incorporation filed
January 6, 1995
STATE OF NEW JERSEY )
)ss:
COUNTY OF MORRIS )
On the 8th day of September, 1998, before me personally came Lawrence B.
Seidman, to me known, who, being by me sworn, did depose and say that he resides
at 19 Veteri Place, Wayne, New Jersey 07470, that he is the President of Veteri
Place Corporation, the General Partner of Seidman Investment Partnership,L.P.
described in and which executed the above instrument; and that he signed such
instrument by order of the Board of Directors of said Corporation.
/s/ Ruth W. Rivkind
A Notary Public of the
State of New Jersey
My Commission Expires
February 14, 2001
AMENDMENT #3 Filed Mar 5 1999
TO LIMITED PARTNERSHIP
CERTIFICATE OF
SEIDMAN INVESTMENT PARTNERSHIP, L.P.
FILED JANUARY 17, 1995
Section 1 The name of the Partnership is Seidman Investment
Partnership, L.P. Seidman Investment Partnership,
L.P. was filed with the Secretary of State on
January 17, 1995,
Amendment #1 was filed on November 25, 1996
and Amendment #2 was filed on September 10, 1998.
Section 6 Section 6 is hereby amended to add the following
people and entities as limited partners:
NAME CAPITAL CONTRIBUTION
Debra Rolandelli $100,000.00
60 Camilla Dr.
Wayne, NJ 07470
M.C.P./Schatten Investment $100,000.00
Partnership
12 Vreeland Avenue
Totowa, NJ 07512
VETERI PLACE CORPORATION, G.P.
By:
Lawrence B. Seidman,
President Veteri Place
Corporation, Certificate of
Incorporation filed January 6,
1995 General Partner of
Seidman Investment
Partnership, L.P.
Dated:March 4, 1999
STATE OF NEW JERSEY )
) ss:
COUNTY OF MORRIS )
On the day of , before me personally came Lawrence B. Seidman,
to me known, who being by me sworn, did depose and say that he resides at 19
Veteri Place, Wayne, New Jersey 07470, that he is the President of Veteri Place
Corporation, the General Partner of Seidman Investment Partnership, L.P.
described in and which executed the above instrument; and that he signed such
instrument by order of the Board of Directors of said Corporation.
EX-10.4
6
exd.txt
AMENDED & RESTATED AGREEMENT OF LIMITED PART. II
Exhibit D
AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP OF
SEIDMAN INVESTMENT PARTNERSHIP II, L.P.
THIS AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP of Seidman
Investment Partnership II, L.P. (the "Partnership"), dated as of August __,
1998, by and between Veteri Place Corporation, as the General Partner (the
"General Partner") and the persons and entities, referred to in schedule A on
file at the offices of the Partnership, who have executed, either directly or
indirectly by an attorney-in-fact, as limited partners (the "Limited Partners").
PREMISES:
A. The Partnership was organized in accordance with the New Jersey revised
Uniform Limited Partnership Act by the filing by the General Partner of a
Certificate of Limited Partnership with the office of the Secretary of State of
the State of New Jersey on August __ , 1998.
B. The General Partner, pursuant to the authority granted to him under
section 26 of the Agreement, desires to amend the Agreement and to restate the
same.
NOW THEREFORE, in consideration of the premises and the mutual covenants
hereinafter contained, effective as of August __, 1998, it is hereby agreed as
follows:
The following terms shall have the following meaning when used in this
Agreement:
(a) "Act" shall mean the New Jersey Revised Uniform Limited Partnership
Act, amended from time to time.
(b) "Affiliate" shall mean any person performing services on behalf of the
Partnership who (i) directly or indirectly controls, is controlled by, or is
under common control with a General Partner; (ii) is any company of which a
General Partner or its controlling shareholder is an officer, director, partner
or trustee; (iii) a member of the family of the controlling shareholder of the
General Partner; or (iv) an Individual Retirement account or similar trust for
the benefit of one or more General Partner or its affiliates.
(c) "Agreement" shall mean this agreement of Limited Partnership, as
originally executed and as amended, modified, supplemented or restated from time
to time.
(d) "Capital account" shall mean the account described in Section 8 of this
Agreement.
(e) "Certificate" shall mean the Partnership's certificate of Limited
Partnership as defined in section 2 of this Agreement.
(f) "Code" shall mean the Internal Revenue code of 1986, or successor
provision of law, and the regulations issued thereunder.
(g) "Fiscal Period" shall mean the period beginning on the day immediately
succeeding the last day of the immediately preceding fiscal Period and ending on
the earliest occurring of the following:
(i) The last day of the Fiscal Year;
(ii) The day immediately preceding the day on which
a new Partner is admitted to the Partnership;
(iii) the day immediately preceding the date on
which a Partner makes an additional capital contribution to the Partner's
capital account;
(iv) The day on which a Partner withdraws, in
whole or in part, the amount of his or its Capital account;
(v) The date of dissolution of the Partnership in
accordance with Section 5 of this Agreement.
(h) "Fiscal "Quarter" shall mean a fiscal quarter of the
Partnership.
(i) "Fiscal Year" shall mean the fiscal year of the
Partnership, which shall be the calendar year.
(j) "General Partner Percentage" shall mean a percentage
established by the General Partner for each General Partner on the
Partnership's books as of the first day of each Fiscal Period. The sum of
the General Partner's Percentages for each Fiscal Period shall equal one
hundred percent (100%).
(k) "Net Profit" of the Partnership shall mean, with
respect to any Fiscal Period, the excess of the aggregate revenue, income
and gains (realized and unrealized) earned on an accrual basis during the
fiscal Period by the Partnership from all sources over the expenses and losses
(realized and unrealized) incurred on an accrual basis during the fiscal
Period by the Partnership.
(l) "Net Loss" of the Partnership shall mean, with
respect to any fiscal Period, the excess of all expenses and losses
(realized and unrealized) incurred on an accrual basis during the fiscal
Period by the Partnership over the aggregate revenue, income and gains
(realized and unrealized) earned on the accrual basis during the fisca
period by the Partnership from all sources.
(m) "Partnership Percentage" shall mean a percentage
established for each partner on the Partnership'books as of the first day of
each Fiscal Period. The Partnership Percentage of a Partner for a Fiscal
Period shall be determined by dividing the amount of the Partner's capital
account as of the beginning of the Fiscal Period by the sum of the capital
accounts of all of the Partners as of the beginning of the fiscal
Period. The sum of the Partnership Percentage for each fiscal Period shall
equal one hundred percent (100%).
2. Organization.
The General Partner has executed a Certificate of Limited Partnership
pursuant to the provisions of the Act (the "Certificate") and has caused the
certificate to be filed as required by the Act. The General Partner shall also
execute and record all amendments to the Certificate or additional certificates
as may be required by this Agreement or by law.
3. Name of Partnership.
The name of the Partnership shall be Seidman Investment Partnership II,
L.P. or such other name as the General Partner may from time to time designate.
4. Principal Office, Resident Agent, Registered Office.
The principal office of the Partnership is 100 Misty Lane, Parsippany, New
Jersey 07054 or any other place determined by the General Partner. The
Partnership's phone number is (973) 560-1400, Ext. 108. The name and address of
the registered agent for service of process in the State of New Jersey is
Lawrence B. Seidman, 100 Misty Lane, Parsippany, NJ 07054. The address of the
registered office of the Partnership in the State of New Jersey is c/o Lawrence
B. Seidman,100 Misty Lane, Parsippany, NJ 07054.
5. Term of the Partnership.
(a) The term of the Partnership, having commenced on the date the
Certificate was filed shall continue until the first of the following events
occurs:
(i) December 31, 2014;
(ii) a written consent to dissolution of the Partnership by
all Partners;
(iii) upon the General Partner ceasing to be a general
partner as a result of doing or being subject to one or more of the following:
(A) withdrawing from the Partnership in accordance
with Section 21 of this Agreement;
(B) assigning all of its interest in the
Partnership;
(C) making an assignment for the benefit of its
creditors;
(D) filing a voluntary petition in bankruptcy;
(E) being adjudged bankrupt or insolvent or having
entered against it an order of relief in any bankruptcy or insolvency
proceeding;
(F) filing a petition or answer seeking for itself
any reorganization, arrangement,composition, readjustment, liquidation,
dissolution, or similar relief under any statute, law, or regulation;
(G) filling an answer or other pleading admitting
or failing to contest the material allegations of a petition filed against
it in any proceeding seeking reorganization, arrangement,composition,
readjustment, liquidation, dissolution, or similar relief under any
statute, law or regulation;
(H) seeking, consenting to, or acquiescing in the
appointment of a trustee or receiver, or liquidator of all or any substantial
part of its properties;
(I) being the subject of any proceeding seeking
reorganization, arrangement,composition, readjustment, liquidation,
dissolution, or similar relief under any statute, law or regulation,which
proceeding shall have continued for one hundred and twenty (120) days after the
commencement thereof; or the appointment of a trustee, receiver, or liquidator
for such General Partner or all or any substantial part of its properties
without its consent or acquiescence, which appointment is not vacated or
stayed for ninety (90) days after the expiration of the stay during which period
the appointment is not vacated;
(J) the death of the General Partner; or
(K) the entry by a court of competent jurisdictio
adjudicating such General Partner incompetent to manage his person or his
property; or
(iv) upon issuance of a non-appealable decree of
dissolution of the Partnership by a New Jersey Court of competent
jurisdiction.
(b) In the event a General Partner does or becomes subject to any of the
provisions of subsection (a)(iii) of this Section 5, the Partnership shall be
dissolved and its affairs wound up as provided in Section 22 of this Agreement.
6. Purposes
The Partnership is organized for the following purposes:
(a) to invest and trade, on margin or otherwise, in "Securities," as that
term is defined in Section 2(1) of the Securities Act of 1933, as amended (the
"1933 Act");
(b) to sell Securities short and cover short sales;
(c) to lend funds or properties of the Partnership, either with or without
security; and
(d) to execute, deliver and perform all contracts and other undertakings,
and engage in all activities and transactions, that the General Partner believes
are necessary or advisable in carrying out the purposes specified all
subsections (a), (b), and (c) of this Section 6, including without limitation:
(i) to purchase, transfer or acquire in any manner and
exercise all rights, powers, privileges and other incidents of ownership or
possession with respect to the investments described in subsection (a) of this
Section 6; and
(ii) to register or qualify the Partnership under any
applicable Federal or state laws, or to obtain exemptions under those laws, if
registration, qualification, or exemption is deemed necessary by the General
Partner.
7. Contributions of the Partners; New Partners.
(a) Each Partner shall make a contribution to the Partnership's
capital ("Capital Contribution") in the amount set out opposite the
Limited Partner's name in Schedule A attached to this Agreement.
(b) Any Partner may elect, with the consent of the General Partner to
make an additional Capital Contribution, as of the first day of any fiscal
Quarter. The General Partner may, in its sole discretion, permit additional
Capital Contributions to be made more frequently than quarterly.
(c) No Partner shall be required to make any additional Capital
Contributions.
(d) Capital Contributions made by Limited Partners must be in cash.
(e) The General Partner shall have the right, but not the obligation,
to admit new Partners to the Partnership as of the first day of any Fiscal
quarter. The General Partner may, however, in its sole discretion, admit
new Partners more frequently than quarterly.
8. Capital Accounts.
A Capital account shall be established for each Partner. For the
Fiscal Period during which a Partner is admitted to the Partnership, his or
its capital account shall equal the amount of his or its initial Capital
Contribution. For each subsequent Fiscal Period, the Partner's Capital
account will equal the sum of the amount of his or its Capital account as
finally adjusted for the immediately preceding fiscal Period and the amount
of any additional Capital Contribution made by the Partner as of the first
day of the current Fiscal Period.
9. Adjustments to Capital Accounts.
At the end of each Fiscal Period, the Capital Accounts of the Partners
shall be adjusted in the following manner:
Net Profits for each year (as defined below) shall be allocated as
follows:
(a) First, to the extent of any net losses allocated to the Limited
Partners, ninety-nine (99%) percent of the Net Profits shall be allocated
to the Limited Partners, and one percent (1%) to the General Partner until
the Limited Partners have recouped any Net Losses previously allocated to
them.
(b) Thereafter, any remaining Net Profit shall be allocated
seventy-five (75%) percent to the Limited Partners and twenty-five (25%)
percent to the General Partner (the "Incentive Allocation").
Net Losses for each calendar year shall be allocated as follows:
(a) First, to the extent that the General Partner's capital account is
positive, seventy-five (75%) percent of the Net Losses shall be allocated
to the Limited Partner and twenty-five (25%) percent to the General
Partner.
(b) From and after the General Partner's capital account is zero, the
Net Losses shall be allocated ninety-nine (99%) percent to the Limited
Partner and one percent (1%) to the General Partner.
The portion of the Net Profit and Net Losses allocated to the Limited
Partner shall be allocated between the Limited Partners based on the
proportion that such Limited Partner's capital account bears to the capital
account of all limited partners.
Notwithstanding the preceding provisions of this Article 4:
(a) Except as provided in sub-section (e) below, no allocation of loss
or deduction shall be made to a Partner if such allocation would cause at
the end of any taxable year a deficit in such Partner's Adjusted Capital
Account to exceed his or its allocable share of Minimum Gain (as defined in
Treasury Regulation Section 1.704-1(b)(iv)(e); and any such loss or
deduction not allocated to a Partner by reason of this Section shall be
allocated pro-rata to each other Partner if and to the extent that such
allocation shall not create a deficit in such other Partner's Adjusted
Capital Account in excess of his allocable share of Minimum Gain; provided,
however, that if such allocation would create such deficit in all Partner'
Adjusted Capital Accounts in excess of their share of Minimum Gain, then
such allocation shall be made in accordance with the principles of Treasury
Regulation Section 1.704-1(b).
(b) If, during any taxable year, there is a net decrease in Minimum
Gain then each Partner shall, before any other allocations are made for
such year, be allocated in a manner so as to satisfy the requirements of
Treasury Regulation Section 1.704-2(f), items of Partnership income and
gain for such year (and, if necessary, subsequent years) in an amount equal
to each Partner's share of the net decrease in Partnership Minimum Gain
(within the meaning of Treasury Regulation Section 1.704-2(g)(2).
(c) If, during any taxable year, there is a net decrease in
Partnership Minimum Gain Attributable to Partner Nonrecourse Debt, then
each Partner with a share of the Partnership Minimum Gain Attributable to
Partner Nonrecourse debt at the beginning of the year shall , before any
other allocations are made for such year other than those pursuant to
Section (b) above, be allocated in a manner so as to satisfy the
requirements of Treasury Regulation Section 1.704-2(i)(4), items of
Partnership income and gain for such year (and, if necessary, for
subsequent years) in an amount equal to each Partner's share of the net
decrease in Minimum Gain Attributable to Partner Nonrecourse Debt as
determined in accordance with Treasury Regulation Section 1.704-2(i)(4).
(d) If during any taxable year a Partner unexpectedly receives (i) a
distribution of cash or property from the Partnership or (ii) an adjustment
or allocation described in Treasury Regulation Section 1.704-1(b)(2)(ii)
(d) (5) as in effect on the date hereof (concerning allocations of loss and
deduction if Partners' interests change during the year, if a Partnership
interest is acquired by gift or if a Partner receives certain Partnership
property in redemption of part or all of his or its interest in the
Company), and if such adjustment , allocation or distribution would cause
at the end of the taxable year a deficit balance in such Partner's Adjusted
Capital Account in excess of his allocable share of Minimum Gain, then a
pro-rata portion of each item of partnership income, including gross
income, and gain for such taxable year (and, if necessary, subsequent
taxable years) shall be allocated to such Partner in an amount and in a
manner sufficient to eliminate such excess balance as quickly as possible
before any other allocation is made for such year other than pursuant to
Subsection (b) hereof so as to satisfy the requirements of Treasury
Regulation Section 1.704-1(b)(2)(ii)(d) (qualified income offset).
(e) To the extent required by Treasury Regulation Section
1.704-2(i)(1), Partner Nonrecourse Debt Deductions for any taxable year
shall be allocated to the Partner (or Partners) who bear(s) the economic
risk of loss of such Partner Nonrecourse Debt.
(f) In the event that any allocation is or has been made to a Partner
pursuant to Subsections (a), (b), (c) (d) or (e) above, subsequent items of
income, deduction, gain and loss shall be allocated before any other
allocations are made (subject to the provisions of Subsections (a), (b),
(c) (d) or (e)) to the Partners in the manner which would result in each
Partner having a Capital Account balance equal to what it would have been
had the allocation pursuant to subsections (a), (b), (c) (d) or (e) not
occurred.
(g) For purposes of this Article, each Partners "Adjusted Capital
Account" shall equal the Capital Account of each Partner (1) reduced at the
end of each taxable year by the sum of (x) the excess of distributions
reasonably expected to be made to such Partner over the offsetting
increases to such Partner's Capital Account reasonably expected to be made
in the same taxable year as the aforesaid distributions, and (y)
allocations expected to be made described in Treasury Regulations Section
1.704-1(b)(2)(ii)(d)(5) as in effect on the date hereof (concerning
allocations of loss and deduction if Partners' interests change during the
year, if a Partnership interest is acquired by gift or if a Partner
receives certain Partnership property in redemption of part or all of his
interest in the Partnership), and (2) increased by the sum of (i) the
amount, if any, which the Partner is obligated to restore to the
Partnership upon liquidation of his interest therein if a deficit balance
exists in his Capital Account at such time, (ii) the outstanding principal
balance of any promissory note made by such Partner and contributed to the
Partnership if such note is not readily tradable on an established
securities market and if such note must be satisfied within 90 days after
the date said Partner's interest is liquidated, (iii) the amount of any
unconditional obligation of such Partner to make subsequent contributions
to the Partnership (whether imposed by this Agreement or by law), and (iv)
the sum of (a) the amount the Partner would be personally liable for either
as a Partner or in his individual capacity as a guarantor or otherwise, and
(b) the economic risk of loss the Partner would bear attributable to any
Partnership liability (as determined in accordance with Treasury Regulation
Section 1.752-2).
(h) In accordance with Section 704(b) and (c) of the Code and
Regulations thereunder, income, gain, loss and deduction with respect to
any property contributed to the capital of the Partnership (including all
or part of any deemed capital contribution under Section 708 of the Code)
shall, solely for tax purposes, be allocated among the Partners so as to
take account of any variation between the adjusted basis of such property
to the Partnership and its agreed value. In the event that Capital Accounts
are ever adjusted pursuant to Treasury Regulation Section 1.704-1(b)(2) to
reflect the fair market value of any Partnership property, subsequent
allocations of income gain, loss and deduction with respect to such asset
shall take account of any variation between the adjusted basis of such
asset and its value as adjusted in the same manner as required under
Section 704(c) of the Code and the Regulations thereunder.
(i) The allocations provided in Sections 4.5(a)-(h) are intended to
comply with the provisions of Section 704(b) of the Code and the
Regulations thereunder. However, If any such allocation causes a distortion
in the Partner's Partnership Interest in contravention of the Partners'
economic arrangement as reflected in Article 4, the General Partner has the
authority to make curative allocations to bring such allocations in
accordance with such Partner' Partnership Interest, as if such allocations
which caused the distortion had not occurred.
(j) The allocations provided in this Section are intended to comply
with the provisions of Section 704(b) of the Code and the Regulations
thereunder. If any such allocation under this Section is inconsistent
therewith, the General Partner has the authority to make a curative
allocation to bring such allocations in compliance with Section 704(b) of
the Code and Regulations thereunder.
For purposes of this Agreement, the following terms shall have the
definitions set forth below:
"Nonrecourse Liability." Any debt of the Partnership for which no
Partner has any economic risk of loss, determined in accordance with
Internal Revenue Regulation Section 1.704-2(b)(3).
"Partner Nonrecourse Debt." Any nonrecourse debt of the Partnership
for which a Partner bears the economic risk of loss, determined in
accordance with Treasury Regulation Section 1.704-2(b)(4).
"Partner Nonrecourse Debt Deductions." With regard to any Partner
Nonrecouse Debt, the amount of the net increase during any Partnership
taxable year in the amount of Minimum Gain Attributable to Partner
Nonrecourse Debt, over the aggregate amount of any distributions during
such year to the Partner who bears the economic risk of loss for such debt
that are allocable to an increase in the Minimum Gain Attributable to such
Partner Nonrecourse Debt. Such amounts shall be determined in accordance
with Treasury Regulation Section 1.704-2(I) (2).
"Recourse Debt." All Partnership debt other than Nonrecourse Liability.
10. Hot Issues.
In the event the General Partner decides to invest in securities which
are the subject of a public distribution and which the General Partner, in
his sole discretion, believes may become a "hot issue" as that term is
defined in Article III, Section 1 of the Rules of Fair Practice of the
National Association of Securities Dealers, Inc. (the "Association"), such
investment shall be made in accordance with the following provisions:
(a) any such investment made in a particular Fiscal Period shall be
made in a special account (the "Hot Issues account");
(b) only those Partners who do not fall within the proscription of
Article III, section 1 of said Rules of Fair Practice ("Unrestricted
Partners") shall have any beneficial interest in the Hot Issues Account;
(c) each Unrestricted Partner shall have a beneficial interest in the
Hot Issues Account for any Fiscal Period in the proportion which (i) such
Unrestricted Partner's Capital account as of the beginning of the Fiscal
Period bore to (ii) the sum of the Capital Accounts of all Unrestricted
Partners as of the beginning of such fiscal Period.
(d) Funds required to make a particular investment shall be
transferred to the Hot Issues account from the regular account of the
Partnership; securities involved in the public distribution shall be
purchased in the Hot Issues Account, held in the Hot Issues Account and
eventually sold from the Hot Issues Account or transferred to the regular
account at fair market value as of the day of transfer as determined by the
General Partner with such transfer being treated as a sale; if such
securities are sold from the Hot Issues account, the proceeds of the sale
shall be transferred from the Hot Issues account to the regular account of
the Partnership.
(e) as of the last day of each Fiscal Period in which a particular
investment or investments are held in the Hot Issues Account: (A) interest
shall be debited to the Capital Accounts of the Unrestricted Partners in
accordance with their beneficial interest in the Hot Issues Account at the
interest rate being paid by the Partnership from time to time for borrowed
funds during the period in that Fiscal Period that funds from the regular
account have been held in or made available to the particular Hot Issues
Account or, if no such funds are being borrowed during such period, the
interest rate that the General Partner determines would have been paid if
funds had been borrowed by the Partnership during such period; and such
interest shall be credited to the Capital Accounts of all the Partners,
both General and Limited, in the proportions which (i) each Partner's
Capital Account as of the beginning of such Fiscal Period bore to (iii) the
sum of the Capital Accounts of all Partners as of the beginning of such
Fiscal Period and (B) any Net Profits or Net Losses during such Fiscal
Period with respect to the Hot Issues Account shall be allocated to the
Capital accounts of the Unrestricted Partners in accordance with their
beneficial interest in the Hot Issues Account during such Fiscal Period;
provided, however, that the amount of such interest shall not exceed the
amount of profit accrued in the Hot Issues Account; and
(f) the determination of the General Partners as to whether a
particular Partner falls within the proscription of Article III, Section I
of said Rules of Fair Practice shall be final.
11. Valuation.
The Partnership's assets shall be valued in accordance with the
following principles:
(a) Any Security that is listed on a national securities exchange will
be valued at its last sale price on the date of determination as recorded
by the composite tape system, or if no sales occurred on that day, at the
mean between the closing "bid" and "asked" prices on that day as recorded
by the system or the exchange, as the case may be;
(b) Any Security that is a National Market Security will be valued at
its last sale price on the date of determination as reported by the
National Association of Securities dealers automated quotations system
("NASDAQ") or if no sale occurred on that day, at the mean between the
closing "bid" and "asked" prices on that day as reported by NASDAQ:
(c) Any Security not listed on a national securities exchange and not
a National Market Security will be valued at the mean between the closing
"bid" and "asked" prices on the date of determination as reported by NASDAQ
or, if not so reported, as reported in the over-the-counter market in the
United States;
(d) An option shall be valued at the last sales price or, in the
absence of a last sales price, the last offer price; and
(e) All other Securities shall be assigned the value that the General
Partner in good faith determine.
12. Determination by General Partner of Certain Matters.
(a) All matters concerning the valuation of Securities, the allocation
of profits, gains and losses among the Partners, including the taxes on
them and accounting procedures, not specifically and expressly provided for
by the terms of this Agreement, shall be determined in good faith by the
General Partner, whose determination shall be final, binding and conclusive
upon all of the Partners.
(b) gains, losses, and expenses of the Partnership for each Fiscal
Period shall be allocated among the Partners for income tax purposes in a
manner so as to reflect, as nearly as possible, the amounts credited or
charged to each Partner's Capital Account pursuant to Section 9 of this
Agreement.
(c) The General Partner shall have the power to make all tax elections
and determinations for the Partnership, and to take any and all action
necessary under the Code or other applicable law to effect those elections
and determinations. All such elections and determinations by the General
Partner shall be final, binding and conclusive upon all Partners.
13. Liability of Partners.
(a) The General Partner shall not be obligated to contribute cash or
other assets to the Partnership to make up deficits in their Capital
accounts or in the Capital Accounts of the Limited Partners either during
the term of the Partnership or upon liquidation. The General Partner shall
be liable for all debts and obligations of the partnership to the extent
that the Partnership is unable to pay such debts and obligations up to the
extent of Veteri's capital.
(b) The doing of any act or the failure to do any act by a General
Partner, the effect of which may cause or result in loss, liability, damage
or expense to the Partnership or any Partner shall not subject a General
Partner to any liability to the Partnership or to any Partner, except that
a General Partner may be so liable if it has not acted in good faith, or
has committed gross misconduct or was grossly negligent.
(c) A Limited Partner will not be liable for any debts or bound by any
obligations of the Partnership except to the extent set forth in
subsections (d), (e) and (f) of this Section 13.
(d) A Limited Partner who has received the return of any part of his
or its Capital contribution without violation of this Agreement or the Act
shall not therefore be labile to the Partnership or its creditors.
(e) A Limited Partner receiving a return of any portion of his or its
Capital Contribution in violation the Act or this Agreement will be Liable
to the Partnership for a period of six (6) years thereafter for the amount
of the contribution wrongfully returned.
(f) A Limited Partner may be liable to the Partnership or creditors of
the Partnership for any amounts distributed if, and to the extent that, at
the time of the distribution, he actually knew that, after giving effect to
the distribution, all liabilities of the Partnership, other than
liabilities to Partners on account of their interest in the Partnership,
exceeded the fair value of the Partnership's assets.
14. Rights and Duties of the General Partner
(a) The General Partner shall have the exclusive right to manage and
control the affairs of the Partnership, and shall have the power and
authority to do all things necessary or proper to carry out the purposes of
the Partnership. The General Partner shall devote an amount of time and
attention that the General Partner in its sole discretion deems necessary
or appropriate.
(b) Without limiting the generality of the foregoing, the General
Partner shall have full power and authority:
(i) to engage independent agents, investment advisors, attorneys,
accountants and custodians as the General Partner deems necessary or
advisable for the affairs of the Partnership;
(ii) to receive, buy sell, exchange, trade, and otherwise deal in
and with Securities and other property of the Partnership;
(iii) to open, conduct and close accounts with brokers on behalf
of the Partnership and to pay the customary fees and charges
applicable to transactions in those accounts;
(iv) to open, maintain and close accounts, including margin
accounts, with brokers and banks, and to draw checks and other orders
for the payment of money by the Partnership;
(v) to file, on behalf of the Partnership, all required local,
state and Federal tax and other returns relating to the Partnership;
(vi) to cause the Partnership to purchase or bear the cost of any
insurance covering the potential liabilities of the General Partner
and any associate, employee or agent of the General Partner arising
out of the General Partner's actions as General Partner under this
Agreement;
(vii) to cause the Partnership to purchase or bear the cost of
any insurance covering the potential liabilities of any person serving
as a director, officer or employee of an entity in which the
Partnership has an investment or of which the Partnership is a
creditor;
(viii) to commence or defend litigation or submit to arbitration
any claim or cause of action that pertains to the Partnership or any
Partnership assets;
(ix) to enter into, make and perform contracts, agreements and
other undertakings, and to do any other acts, as the General Partner
deems necessary or advisable for, or as may be incidental to, the
conduct of the business of the Partnership, including, without
limiting the generality of the foregoing, contracts, agreements,
undertakings and transactions with any Partner or with any other
person, firm or corporation having any business, financial or other
relationship with any Partner or Partners:
(x) to make or revoke elections pursuant to Section 754 of the
Code to adjust the basis of the Partnership's property as permitted by
Sections 734(b) and 743(b) of the Code; and
(xi) to designate a Tax Matters Partner for all purposes under
the Code
15. Expenses.
The Partnership shall bear all expenses relating to its
organization. The Partnership will bear the expenses of its
administration, accountant, its legal counsel, and expenses of
investments.
16. Administrative Fee.
The General Partner will not charge an administrative fee.
17. Limitation on Powers of Limited Partners.
No Limited Partner shall participate in the control of the
Partnership's business, transact any business in the Partnership's
name or have the power to sign documents for the Partnership or to
bind the Partnership in any other way.
18. Other Business ventures.
Each Partner agrees that each General Partner and its affiliates
and associates may engage in other business activities or possess
interest in other business activities of every kind and description,
independently or with others. These activities may include, without
limitation, establishing a broker-dealer and investing in real estate
and real estate related partnerships, or in investing, in financing,
acquiring and disposing of interest in securities in which the
Partnership may from time to time invest, or in which the Partnership
is able to invest or otherwise have any interest. The Limited Partners
agree that the General Partner and its affiliates may act as general
partner of other partnerships, including investment partnerships.
19. Limitation on Assignability of Interest of Limited Partners.
(a) No Limited Partner may assign or otherwise transfer or
encumber his or its interest in the Partnership, in whole or in part,
without the consent of the General Partner and without a written
opinion of counsel to or approved by the General Partner that the
proposed transfer (i) is consistent with all applicable provisions of
the 1933 Act, and the rules and regulations thereunder, as from time
to time in effect, as well as any applicable provisions of any state
"blue sky" law; and (ii) would not result in the Partnership's having
to register as an investment company under the Investment Company Act
of 1940, as amended.
(b) Notwithstanding any other provision of this Agreement, any
successor to any Limited Partner shall be bound by the provisions of
this Agreement. Prior to recognizing any assignment of an interest in
the Partnership that has been transferred in accordance with this
Section 19, the General Partner may require the transferring Limited
Partner to execute and acknowledge an instrument of assignment in form
and substance satisfactory to the General Partner, and may require the
assignee to agree in writing to be bound by all the terms and
provisions of this Agreement, to assume all of the obligations of the
assigning Limited Partner and to execute whatever other instruments or
documents the General Partner deems necessary or desirable in
connection with the assignment.
(c) No Limited Partner shall have the right to have his or its
assignee admitted as a substitute Limited Partner, except upon the
written consent of the General Partner, which consent may be withheld
in the sole discretion of the General Partner.
(d) Each Limited Partner hereby approves of the admission to the
Partnership as a Limited Partner of any assignee who succeed to the
interest in the Partnership of a Limited Partner in accordance with
the provisions of this Section 19.
20. Withdrawals by a Limited Partner.
(a) (i) A Limited Partner who shall have been a Limited Partner
for at least eight full Fiscal Quarters shall have the right, as of
the end of any Fiscal Year, or at other times at the discretion of the
General Partner, to withdraw all or a portion of the amount of his or
its Capital Account, so long as the General Partner receives written
notice of the intended withdrawal not less than ninety (90) days prior
to the withdrawal, stating the amount to be withdrawn. In no event,
however, shall a Limited Partner be permitted to withdraw any amounts
from his or its Capital Account in excess of the positive balance of
his or its Capital Account. If the amount of a Limited Partner's
withdrawal represents less than seventy-five (75%) of the Limited
Partner's Capital Account, the Limited Partner will receive the
proceeds of the withdrawal within thirty (30) days after the date of
withdrawal. If the amount of a Limited Partner's withdrawal represents
seventy-five (75%) or more of the Limited Partner's Capital Account,
the Limited Partner will receive seventy-five percent (75%) of his
Capital account within thirty (30) days after the date of withdrawal
and the remainder of the amount withdrawn within ten (10) days after
the Partnership has received financial statements from its independent
certified public accountants pursuant to Section 23(c) of this
Agreement. If a Limited Partner requests withdrawal of capital which
would reduce his Capital Account below the amount of his initial
Capital Contribution, the General Partner may treat such request as a
request for withdrawal of all of such Partner's Capital Account. The
distribution of any amount withdrawn by a Limited Partner may take the
form of cash and/or marketable securities as determined by the General
Partner in his sole discretion.
(ii) In the event of a proposed withdrawal of capital by one or
more General Partner or Affiliates pursuant to Section 21(a)(ii) of
this Agreement, as a result of which the aggregate of the Capital
Accounts of the General Partner and Affiliates will be less than
$50,000 (fifty thousand dollars), a Limited Partner shall have the
right to withdraw all or a portion of the amount of his or its Capital
Account, so long as the General Partner receives written notice of the
intended withdrawal not more than fifteen (15) days after the date of
the notice of withdrawal by such General Partner or General Partner or
Affiliate or Affiliates pursuant to said Section 21(a)(ii), stating
the amount to be withdrawn. In such event the withdrawal by such
Limited Partner shall be effective as of the effective date of the
withdrawal by the General Partner or General Partners pursuant to said
Section 21(a)(ii). The amount available for withdrawal shall be
calculated in the same manner as provided for in the last sentence of
paragraph (b) of Section 5 hereof.
(b) Any Limited Partner's interest in the Partnership may be
terminated by the Partnership as of the end of any Fiscal Year upon
prior written notice, so long as the General Partner determines the
termination to be in the best interest of the Partnership. In the
event that a Limited Partner's interest in the Partnership is
terminated pursuant to this Section 20, the Limited Partner shall
receive ninety percent (90%) of the value of his Capital Account
within ninety (90) days after written notice of termination is given
by the Partnership and the remaining ten percent (10%) within ten (10)
business days after receipt by the Partnership of financial statements
with respect to the Fiscal Year in which his or its interest in the
Partnership is terminated.
21. Withdrawals by the General Partners and Affiliates.
(a) (i) The General Partner shall have the right to withdraw any
amount of cash from his Capital Account as of the end of any Fiscal
Year, without prior notification to the Limited Partners, provided
that, after giving effect to such withdrawal, the aggregate Capital
accounts of the General Partner and his Affiliates are not less than
$50,000 (fifty thousand dollars).
(ii) Upon forty-five (45) days' prior notice to the Limited
Partners, a General Partner or an Affiliate may withdraw any amount
from his Capital Account contributed to the Partnership as a result of
which withdrawal the aggregate Capital Accounts of the General Partner
and their Affiliates would be reduced below $50,000. (fifty thousand
dollars).
(b) The General Partner may voluntarily resign or withdraw from
the Partnership as of the end of any Fiscal Year upon sixty (60) days'
written notice sent to all Partners.
22. Dissolution and Winding Up of the Partnership.
On dissolution of the Partnership, the General Partner or if
there is no General Partner, one or more persons approved by Limited
Partners holding a majority in interest of the Capital Accounts of the
Limited Partners) shall wind up the Partnership's affairs and shall
distribute the Partnership's assets in the following manner and order:
(a) in satisfaction of the claims of all creditors of the
Partnership, other than the General Partners;
(b) in satisfaction of the claims of the General Partners as
creditors of the Partnership; and
(c) any balance to the Partners in the relative proportions that
their respective Capital Accounts bear to each other, those Capital
Accounts to be determined as if the Fiscal Year ended on the date of
the dissolution.
23. Accounting and Reports.
(a) The records and books of account of the Partnership shall be
reviewed as of the end of each fiscal Year by independent certified
public accountants selected by the General Partner in his sole
discretion.
(b) As soon as practicable after the end of each Fiscal Year, the
General Partner shall cause to be delivered to each person who was a
Partner at any time during that Fiscal Year all information deemed
necessary by the General Partner in his sole discretion for the
preparation of the Partner's income tax returns, including a Form
1065/Schedule K-1 statement showing the Partner's share of Net Profit
or Net Loss, deductions and credits for the year Federal income tax
purposes, and the amount of any distributions made to or for the
account of the Partner pursuant to this Agreement.
(c) The independent certified public accounts selected by the
General Partner in accordance with subsection (a) of this Section 23
shall prepare and mail to each Partner, within ninety (90) days after
the end of each fiscal Year, an income statement for the Fiscal Year
and a balance sheet as of the end of the Fiscal Year.
(d) The Partnership shall cause to be prepared and mailed to each
Partner a report setting out as of the end of each fiscal quarter
information determined by the General Partner to be appropriate.
(e) The General Partner shall cause tax returns for the
Partnership to be prepared and timely filed with the appropriate
authorities.
24. Books and Records.
The General Partner shall keep at the Partnership's principal
office:
(a) books and records pertaining to the Partnership's business
showing all of its assets and liabilities, receipts and disbursements,
realized profits and losses, Partners' Capital Accounts and all
transactions enter into by the Partnership;
(b) a current list of the full name and last known home, business
or mailing address of each Partner set out in alphabetical order;
(c) a copy of the Certificate and all amendments to it, together
with executed copies of any powers of attorney pursuant to which the
Certificate and any amendments to it have been executed;
(d) copies of the Partnership's Federal, state and local income
tax returns and reports, if any, for the three (3) most recent years;
and
(e) copies of this Agreement as may be amended from time to time.
All books and records of the Partnership required to be kept
under this Section 24 shall be available for inspection by a Partner
of the Partnership at the offices of the Partnership during ordinary
business hours for any purpose reasonably related to the Partner's
interest as a Partner in the Partnership.
25. Indemnification.
(a) The Partnership shall indemnify each General Partner and any
of his Affiliates (each an "Indemnitee") to the fullest extent
permitted by law and will hold each harmless from and with respect to
(i) all fees, costs and expenses incurred in connection with, or
resulting from, any claim, action or demand against any indemnitee
that arises out of or in any way relates to the Partnership, its
properties, business or affairs, and (ii) any losses or damages
resulting from any such claim, action or demand, including amounts
paid in settlement or compromise of the claim, action or demand.
(b) No Indemnitee shall be indemnified by the Partnership with
respect to any action or failure to act that does not constitute good
faith, or that constitutes willful misfeasance.
(c) The Partnership may pay the expenses incurred by an
Indemnitee in defending a civil or criminal action, suit or proceeding
brought by a party against the Indemnitee that arises out of or is in
any way related to the Partnership, its properties, business or
affairs, upon receipt of an undertaking by the Indemnitee to repay the
amount advanced by the Partnership if an adjudication or determination
is subsequently made by a court of competent jurisdiction that the
Indemnitee is not entitled to indemnification as provided in this
Agreement.
(d) The right of indemnification provided in this Section 25
shall be in addition to any rights to which an Indemnitee may
otherwise be entitled and shall inure to the benefit of the executors,
administrators, personal representatives, successors or assigns of
each Indemnitee.
(e) The rights to indemnification and reimbursement provided for
in this Section 25 may be satisfied only out of the assets of the
Partnership. No Partner shall be personally liable for any claim for
indemnification or reimbursement under this Section 25.
26. Amendment of Partnership Agreement.
This Agreement may be amended, in whole or in part, by the
written consent of (a) the General Partner, and (b) Partners the value
of whose Capital Account constitute not less than fifty percent (50%)
of the total value of all Capital Accounts of the Partnership,
provided that no such amendment shall affect the allocation of Net
Profit or Net Loss to any Partner who has not consented to such
amendment. In addition, any provision of this Agreement, other than
Section 9, may be amended by the General Partner in any manner that
does not, in the sole discretion of the General Partner, adversely
affect any Limited Partner.
27. Notices.
Notices that may or are required to be given under this Agreement
by any part to another shall be in writing and deposited in the United
States mail, certified or registered, postage prepaid, addressed to
the respective parties at their addresses set out in Schedule A to
this Agreement or to any other addressee designated by any Partner by
notice addressed to the Partnership in the case of any Limited Partner
and to the General Partner in the case of the General Partners.
Notices shall be deemed to have been given when deposited in the
United States mail within the continental United States.
28. Agreement Binding Upon Successors and Assigns.
This Agreement shall inure to the benefit of and shall be binding
upon the heirs, executors, administrators or other representatives,
successors and assigns of the Partners.
29. Governing Law.
This Agreement, and the rights of the Partners under it, shall be
governed by and construed in accordance with the law of the State of
New Jersey.
30. Consents.
Any and all consents, agreements or approvals provided for or
permitted by this Agreement shall be in writing and signed copies of
them shall be filed and kept with the books of the Partnership.
31. Miscellaneous.
(a) This Agreement, including Schedule A appended to it,
constitutes the entire understanding and Agreement of the Partners as
to the operation of the Partnership.
(b) This agreement may be executed in counterparts, each of which
shall be deemed to be an original.
(c) Each provision of this Agreement is intended to be severable.
A determination that a particular provision of this Agreement is
illegal or invalid shall not affect the validity of the remainder of
the Agreement.
(d) Nothing contained in this Agreement shall be construed to
constitute any Partner the agent of another Partner, except as
specifically provided in this Agreement, or in any manner to limit the
partners in the carrying on of their own respective business or
activities.
(e) If there is a conflict between the terms and conditions of
the Partnership Agreement and Offering Memorandum, the Partnership
Agreement shall be controlling.
IN WITNESS WHEREOF, the Partners have executed this Agreement as
of the date first above written.
GENERAL PARTNER
VETERI PLACE CORPORATION
By: Lawrence B. Seidman, President
LIMITED PARTNERS:
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 delivered to the
General Partner.
LAWRENCE B. SEIDMAN
Attorney-in-Fact
Lawrence B. Seidman
AMENDMENT #1
TO LIMITED PARTNERSHIP
CERTIFICATE OF
SEIDMAN INVESTMENT PARTNERSHIP II, L.P.
FILED AUGUST 13, 1998
Section 1 The name of the Partnership is Seidman Investment
Partnership II, L.P.
Section 6 Section 6 is hereby amended to add the following people
and entities as limited partners:
NAME CAPITAL CONTRIBUTION
Dr. John Tafel $150,000.00
2604 South Hayden
Amarillo, Texas 79109
Hawthorne Financial $179,284.87
c/o Eric Nettere
560 West Hawthorne Place
Chicago, Illinois 60657
Eric & Julie Nettere JTWROS $ 70,715.13
560 West Hawthorne Place
Chicago, Illinois 60657
Stephen Chaleff $100,000.00
20 Norman Drive
Rye, New York 10580
Chaleff Family Irrevocable Trust $ 150,000.00
20 Norman Drive
Rye, New York 10580
Urban West Capital Partners,L.P. $ 250,000.00
Att: Stephen Gunther
520 Broadway, Suite 100
Santa Monica, California 90401
Cordell Consultants, Inc. $ 22,000.00
Money Purchase Plan
5540 Laurel Ridge Road
Ruckersville, Virginia 22968
Amalgamated Sludge LLC $ 178,000.00
5540 Laurel Ridge Road
Ruckersville, Virginia 22968
VETERI PLACE CORPORATION, G.P.
By:
Lawrence B. Seidman, President
Veteri Place Corporation
Certificate of Incorporation filed
January 6, 1995
Dated: September 4, 1998
STATE OF NEW JERSEY)
) ss:
COUNTY OF MORRIS )
On the 4th day of September, 1998, before me personally came
Lawrence B. Seidman, to me known, who being by me sworn, did depose and say that
he resides at 19 Veteri Place, Wayne, New Jersey 07470, that he is the President
of Veteri Place Corporation, the General Partner of Seidman Investment
Partnership II, L.P. described in and which executed the above instrument; and
that he signed such instrument by order of the Board of Directors of said
Corporation.
AMENDMENT #2 Filed Mar 5 19999
TO LIMITED PARTNERSHIP
CERTIFICATE OF
SEIDMAN INVESTMENT PARTNERSHIP II, L.P.
FILED AUGUST 13, 1998
Section 1 The name of the Partnership is Seidman Investment
Partnership, LP
Seidman Investment Partnership II, LP
was filed on August 13, 1998, Amendment #1 to Seidman
Investment Partnership II, LP was filed on was filed
on September 8, 1998.
Section 6 Section 6 is hereby amended to add the following
people and entities as limited partners:
NAME CAPITAL CONTRIBUTION
Valerie Westheimer $200,000.
840 Park Avenue
New York, NY 10021
Dr. Thomas Kalman $100,000
11 East 87th Street, Apt. 1B
New York, NY 10128
Mr. David F. Halvorsen $100,000
Halvorsen Family Partnership, Ltd.
276 Old Kingston Rd.
New Paltz, NY 12561
Jacques Pomeranz $200,000
Pound Hollow Rd.
Old Brookville, NY 11545
Chicago, Illinois 60657
Ellen Rosenberg $100,000
550 Chestnut Street
#202
Winnetka, IL 60093
Tom Blew $100,000
1409 H South Prairie Ave.
Chicago, IL 60605
Metalle & Weiche Rohstoffe $1,300,000
Guioliettstrasse 54
Frankfurt D60325
Stephen Sherwin, Living $100,000
Trust dtd 8/5/91
2295 Gulf of Mexico Drive
Apt. 102S
Longboat Key, FL 342228-3258
Section 6 Section 6 is hereby amended to revise the amount of
Capital Contribution for the following people and
entities as limited partners:
Eric & Julie Nettere JTWROS $250,000.00
36987 Mountville Road
Middleburg, VA
VETERI PLACE CORPORATION, G.P.
By:
Lawrence B. Seidman, President
Veteri Place Corporation,
Certificate of Incorporation
filed January 6, 1995,
General Partner of Seidman
Investment Partnership II, L.P.
Dated:March 4, 1999
STATE OF NEW JERSEY )
) ss:
COUNTY OF MORRIS )
On the day of March, before me personally came Lawrence B.
Seidman, to me known, who being by me sworn, did depose and say that he resides
at 19 Veteri Place, Wayne, New Jersey 07470, that he is the President of Veteri
Place Corporation, the General Partner of Seidman Investment Partnership II,
L.P. described in, and which executed the above instrument; and that he signed
such instrument by order of the Board of Directors of said Corporation.
EX-10.5
7
e.txt
OPERAT. AGREEMENT FOR SEIDMAN ASSOC.
Exhibit E
OPERATING AGREEMENT
FOR
SEIDMAN AND ASSOCIATES, LLC.
Dated: November 9, 1994
INDEX
Page No.
Article 1 - Definitions 1
Article 2 - Formation 5
Article 3 - Principal Office 5
Article 4 - Term and Duration 6
Article 5 - Purpose 7
Article 6 - Capital Contributions by the Member7
Article 7 - Additional Capital Contributions 9
Article 8 - Cash Contributions 10
Article 9 - Tax Allocations 11
Article 10 - Rights, Powers and Representation of
the Members 15
Article 11 - Managing Member 17
Article 12 - Books, Records and Reports 19
Article13 - Bank Accounts 20
Article 14 - Rights and Duties of Members 20
Article 15 - Tax Matters 21
Article 16 - Bankruptcy 21
Article 17 - Assignability or Transfer of Int 22
Article 18 - Admission of Substituted Members; Death
or Incapacity; Further Conditions 24
Article 19 - Liquidation 25
Article 20 - Gender 26
Article 21 - Further Assurances 26
Article 22 - Covenant Against Partition 26
Article 23 - Notices 26
Article 24 - Applicable Law 27
Article 25 - Captions 27
Article 26 - Counterparts 27
Article 27 - Binding Effect 27
Article 28 - Partial Invalidity 27
Article 29 - Integration 28
Exhibit A - Property Description
Exhibit B - Contract of Sale
Schedule A - Members' Percentage Interests
Schedule B - Example of the Operation of Section 8.3
OPERATING AGREEMENT
FOR
SEIDMAN AND ASSOCIATES, LLC.
AGREEMENT made November 9, 1994 by and between LAWRENCE SEIDMAN
("Lawrence Seidman"), having an address at 19 Veteri Place, Wayne, New Jersey
07470; SONIA SEIDMAN ("Sonia Seidman"), having an address at 19 Veteri Place,
Wayne, New Jersey 07470; SEIDCAL Associates ("Seidcal"), a New Jersey general
partnership having an address c/o Cali Realty Corporation, 11 Commerce Drive,
Cranford, New Jersey 07016; PAUL SCHIMDT ("Schimdt"), having an address at 159
Clinton Place, Hackensack, New Jersey 07601; and RICHARD GREENBERG
("Greenberg"), having an address at 1235A Route 23 South, Wayne, New Jersey
07474 (hereinafter Lawrence Seidman, Sonia Seidman, Seidcal, Schimdt and
Greenberg may sometimes be referred to individually as a "Member" and
collectively as the "Members").
WITNESSETH:
WHEREAS, the Members desire to form a limited liability company (the
"Company") pursuant to the New Jersey Limited Liability Company Act (the"Act")
and adopt this Operating Agreement in connection therewith; and
WHEREAS, the purpose of the Company shall be to purchase stock in
private and public companies and manage and invest the funds of others for these
purposes and for any and all other purposes permitted pursuant to the Act; and
WHEREAS, the Members wish to set forth the terms and conditions as to
the manner in which the Company shall be operated and to set forth the rights,
obligations and duties of the Members to each other and to the Company; and
WHEREAS, by executing this Operating Agreement, each Member represents
that he has sufficient right and authority to execute this Operating Agreement
and not acting on behalf of any undisclosed or partially disclosed principal.
NOW, THEREFORE, in consideration of ten ($10) dollars and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows effective as of the date first
written above.
ARTICLE 1
DEFINITIONS
1.1 For purposes of this Agreement, the following terms shall have
the definitions set forth below:
"Additional Contribution": Each Member's pro-rata portion of a
Required Amount, determined by multiplying the Required Amount by each Member's
Interest.
"Additional Member": Any person or entity who acquires an additional
interest in the Company.
"Adjusted Capital Account": As defined in Section 9.4(h).
"Capital Account" or "Capital Accounts": As defined in Section 6.4.
"Capital Contributions": The respective capital contributions,
including any Additional Contribution,of each of Member to the Company.
"Capital Transaction" or "Capital Transactions": Sale, transfer,
assignment or exchange of stock purchases or other investment made by the
Company or other similar transactions which, in accordance with generally
accepted principles, are treated as a capital transaction.
"Certificate of Formation": The Certificate of Formation of the Company
filed with the Secretary of State of the State of New Jersey, pursuant to the
Act to form the Company, as originally executed and as amended, modified,
supplemented or restated from time to time, as the context requires.
"Code": The Internal Revenue Code of 1986, as amended, and any
reference to a particular section of the Code shall be deemed to include any
successor section to such section.
"Company": Seidman and Associates, LLC.
"Contributing Member": A Member which has made its Additional
Contribution.
"Default Loan": A loan to the Company of an amount equal to the
Additional Contribution not made by a Defaulting Member.
"Defaulting Member": A Member which fails to make his Additional
Contribution as required herein.
"Default Rate": A floating rate equal to the lesser of (a) ten (10%)
percent per annum in excess of the rate of interest announced from time to time
in The Wall Street Journal as the "prime rate" or "base rate" charged by
institutional commercial lenders, from time to time or (b) the maximum rate of
interest then permitted according to the laws of the State of New Jersey or
according to Federal law, to the extent applicable.
"Gain from a Capital Transaction": The gain recognized by the Company
attributable to a Capital Transaction, determined in accordance with the method
of accounting used by the Company for federal income tax purposes. In the event
there is a revaluation of Company property and the Capital Accounts are adjusted
pursuant to Section 6.4(c), Gain from a Capital Transaction shall be computed by
reference to the "book items" and not the corresponding "tax items".
"Income": Net Proceeds and all other income or amounts, however
characterized, received by the Company.
"Interest": The respective percentage interest of each Member as set
forth on Schedule A.
"Loss from a Capital Transaction": The loss recognized by the Company
attributable to a Capital Transaction, determined in accordance with the method
of accounting used by the Company for federal income tax purposes. In the event
there is a revaluation of the Company property and the Capital Accounts are
adjusted pursuant to Section 6.4(c), Loss from a Capital Transaction shall be
computed by reference to the "book items" and not the corresponding "tax items".
"Managing Member": Lawrence Seidman, or such successor appointed by a
majority in interest of the remaining Members.
"Member": Each of the parties who has executed this Operating
Agreement and any party who may hereafter become an Additional Member or a
Substitute Member pursuant to this Operating Agreement.
"Member Nonrecourse Debt": Any nonrecourse debt of the Company for
which a Member bears the economic risk of loss, determined in accordance with
Treasury Regulation Section 1.704-2(b) (4).
"Member Nonrecourse Debt Deductions": With regard to any Member
Nonrecourse Debt, the amount of the net increase during any taxable year to the
Company in the amount of Minimum Gain Attributable to Member Nonrecourse Debt,
over the aggregate amount of any distributions during such year to the Member
who bears the economic risk of loss for such debt of proceeds of such debt that
are allocable to an increase in the Minimum Gain Attributable to such Member
Nonrecourse Debt. Such amounts shall be determined in accordance with Treasury
Regulation Section 1.704-2(i) (2).
"Minimum Gain": The amount of gain which would be recognized to the
Company for federal income tax purposes if all Company property secured by
Nonrecourse Liability were transferred to the creditor of such debt in
satisfaction thereof (and for no other consideration) in a taxable transaction.
The amount of such gain shall be determined and calculated in accordance with
Treasury Regulation Section 1.704--2(g) (i).
"Minimum Gain Attributable to Member Nonrecourse Debt": The amount of
gain which would be recognized by the Company for federal income tax purposes if
all Company property secured by Member Nonrecourse Debt were transferred to the
creditor of such debt in satisfaction thereof (and for no other consideration)
in a taxable transaction. The amount of such gain shall be determined and
calculated in accordance with Treasury Regulation Section 1.704-2(f) (i) (4).
"Net Proceeds": The net proceeds available to the Company from a
Capital Transaction after deducting (i) all costs and expenses incurred in
connection therewith, (ii) any liens or other indebtedness which is satisfied or
refinanced as a result of such Capital Transaction, and (iii) reasonable
reserves established by the Company from time to time for working capital and
other purposes.
"Net Profit" and "Net Loss": The net income (including income exempt
from tax) and net loss (including expenditures that can neither be capitalized
nor deducted), respectively, of the Company, determined in accordance with the
method of accounting used by the Company for federal income tax purposes, but
computed without regard for Gain from Capital Transactions, Loss from Capital
Transactions and items of income or loss, if any, that are specifically
allocated to Members. In the event there is a revaluation of Company property
and the Capital Accounts are adjusted pursuant to Section 6.4(c), Net Profits
and Net Losses shall be computed by reference to the "book items" and not
corresponding "tax items".
"Nonrecourse Liability": Any Company debt for which no Member has any
economic risk of loss, determined in accordance with Treasury Regulation
Section 1.704-2(b) (3).
"Operating Agreement": This Operating Agreement as originally
executed and as amended, modified,supplemented or restated from time to time.
"Required Amount": The amount of cash required by the Company as
determined by a majority in interestof the Members.
"Substitute Member": Any transferee of a Member's Interests who is
admitted as a Member in the Company pursuant to Article 17 or 18.
"Unrecovered Additional Contributions": The aggregate amount of
Additional Contribution made by a Member pursuant to Section 7.1 hereof less
prior distributions to such Member of Income which is distributed to repay
outstanding Additional Contributions and any interest on any Default Loan
specially allocated to such Member.
ARTICLE 2
FORMATION
2.1 The parties hereto do hereby form the Company under the name
of SEIDMAN AND ASSOCIATES, LLC.pursuant to the Act. Pursuant to the provisions
of the Act, the formation of the Company shall be effective upon the filing of
the Certificate of Formation.
In order to maintain the Company as a limited liability company under
the laws of the State of New Jersey, the Company shall from time to time take
appropriate action, including the preparation and filing of such amendments to
the Certificate of Formation and such other assumed name certificates,
documents, instruments and publications as may be required by law, including,
without limitation, action to reflect:
(i) a change in the Company name;
(ii) a correction of a defectively or erroneously executed
Certificate of Formation;
(iii) a correction of false or erroneous statements in the
Certificate of Formation or the desire of the Members
to make a change in any statement therein in order
that it shall accurately represent the agreement
among the Members; or
(iv) a change in the time for dissolution of the Company
as stated in the Certificate of
Formation and in this Agreement.
Section 2.2 Other Instruments. Each Member hereby agrees to execute and
deliver to the Company within five (5) days after receipt of a written request
therefor, such other and further documents and instruments, statements of
interest and holdings, designations, powers of attorney and other instruments
and to take such other action as the Company deems necessary, useful or
appropriate to comply with any laws, rules or regulations as may be necessary to
enable the Company to fulfill its responsibilities under this Operating
Agreement, to preserve the Company as a limited liability company under the Act
and to enable the Company to be taxed as a partnership for federal and state
income tax purposes.
ARTICLE 3
PRINCIPAL OFFICE
3.1 The Company's registered office in New Jersey shall be at 19 Veteri
Place, Wayne, New Jersey 07470. The Company's registered agent who is a resident
of New Jersey is Lawrence Seidman, whose business address 19 Veteri Place,
Wayne, New Jersey 07470. At any time, the Company may designate another
registered agent and/or office.
3.2 The principal place of business of the Company shall be at 19
Veteri Place, Wayne, New Jersey 07470. At any time, the Company may change the
location of its principal place of business and may establish additional
offices.
ARTICLE 4
TERM AND DURATION
4.1 The Company shall commence upon the filing of the Certificate of
Formation, and shall continue in full force and effect until May 1, 2024,
provided, however, that the Company shall be dissolved prior to such date upon
the happening of any of the following events:
(a) The mutual written consent of the Members to dissolve the
Company.
(b) The sale or other divestiture of all or substantially all of the
assets of the Company and the distribution of the proceeds thereof to the
Members, including real estate or interests held or owned by the Company (other
than a transfer to a nominee of the Company for any Company purpose, which event
shall not be construed as an event of termination); provided, however, that (i)
if the Company receives a purchase money mortgage or other collateral security
in connection with such sale, the Company shall continue (A) until such mortgage
or security interest is paid in full or otherwise disposed of, or (B) in the
event of foreclosure of such mortgage, or security interest provided the Company
retains title therein; and (ii) the Company shall continue if the assets of the
Company are exchanged under Section 1031 of the Code.
(c) Upon the death, retirement, expulsion, bankruptcy or dissolution of
a Member or occurrence of any other event that terminates the continued
membership of a Member in the Company (a "Dissolution Event") unless the
business of the Company is continued by the unanimous consent of the remaining
Members within ninety (90) days following the Dissolution Event.
(d) The entry of a decree of judicial dissolution under Section
49 of the Act.
(e) The happening of any other prior event which pursuant to the terms
and provisions of this Operating Agreement shall cause a dissolution or
termination of the Company.
4.2 Upon any dissolution of the Company, the distribution of the Company's
assets and the winding up of its affairs shall be concluded in accordance with
Article 19 of this Operating Agreement.
ARTICLE 5
PURPOSE
5.1 The business of the Company shall be for the purpose of:
(a) Purchasing stock in private and public companies and managing
and investing funds of others for
these purposes.
(b) Such other activities incident or appropriate to the foregoing,
including acting directly or in conjunction with others through joint ventures,
partnerships or otherwise.
5.2 The business of the Company shall also be for any lawful
purpose.
ARTICLE 6
CAPITAL CONTRIBUTIONS BY THE MEMBERS
6.1 (a) Upon execution hereof, or at such other times as determined by
the Managing Member, each Member shall contribute in cash to the capital of the
Company an amount in the aggregate equal to that set forth opposite his/her/its
name on Schedule A attached hereto.
(b) A Member's interest in the Company shall be represented by the
percentage interest held by such Member. Each Member's respective initial
interest in the Company is set forth opposite his/her name on Exhibit B attached
hereto.
6.2 No Member shall have the right to withdraw any part of his Capital
Contribution or receive any distribution, except in accordance with the
provisions of this Operating Agreement. No interest shall be paid on any Capital
Contribution.
6.3 No Member shall have any priority over any other Member with
respect to the return of Capital Contributions.
6.4 The Company shall maintain a capital account (a "Capital Account")
for each Member within the provisions of Treasury Regulation Section 1.704-1 (b)
(2) (iv) as such regulation may be amended from time to time. Without limiting
the foregoing, the Member's Capital Accounts shall be adjusted as follows:
(a) Subject to the last sentence of Section 6.4 (c), the Capital
Account of each Member shall be credited with (i) an amount equal to such
Member's initial cash contribution and any additional cash contributions to the
Company and the fair market value of property or securities contributed to the
Company (net of liabilities secured by such property) if a contribution of
property or securities shall be permitted by the Company and (ii) such Member's
share of the Company's Net Profits and Gain from Capital Transactions (including
income and gain exempt from tax).
(b) Subject to the last sentence of Section 6.4 (c), the Capital
Account of each Member shall be debited by (i) the amount of cash distributions
to such Member and the fair market value of property and/or securities
distributed to the Member (net of liabilities secured by such property and/or
securities) and (ii) such Member's share of the Company's Net Loss and Net Loss
from Capital Transactions (including expenditures which are not permitted to be
capitalized or deducted for tax purposes).
(c) Upon the transfer of an interest in the Company, the Capital
Account of the transfer Member (as adjusted, if at all, as required by this
Section 6.4) that is attributable to the transferred interest will be carried
over to the transferee Member. The Capital Account will not be adjusted to
reflect any adjustment under Section 743 of the Code except as specifically
provided in Treasury Regulation Section 1.704-1 (b) (2) (iv) (m). Upon (i) the
"liquidation of the Company" (as hereinafter defined), (ii) the "liquidation of
a Member's interest in the Company" (as hereinafter defined), (iii) the
distribution of money, property or securities to a Member as consideration for
an interest in the Company, or (iv) the contribution of money or (if permitted
pursuant to (a) above) property and/or securities to the Company by a new or
existing Member as consideration for an interest in the Company, or upon any
transfer causing a termination of the Company for tax purposes within the
meaning of Section 708(b) (1) (B) of the Code, then adjustments shall be made to
the Members' Capital Accounts in the following manner: all property and
securities of the Company which are not sold in connection with such event shall
be valued at their then fair market value; such fair market value shall be used
to determine both the amount of gain or loss which would have been recognized by
the Company if the property and securities had been sold for its fair market
value (subject to any debt secured by the property and securities) at such time,
and the amount of Income, which would have been distributable by the Company
pursuant to Article 9 if the property and securities had been sold at such time
for said fair market value, less the amount of any debt secured by the property;
the Capital Accounts of the Members shall be adjusted to reflect the deemed
allocation of such hypothetical gain or loss in accordance with Article 10; and
the Capital Accounts of the Members (or of a transferee of a Member) shall
thereafter be adjusted to reflect "book items" and not "tax items" in accordance
with Treasury Regulation Sections 1.704-1 (b) (2) (iv) (g) and 1.704-1 (b) (4)
(i).
(d) For purposes of this Article 6, (i) the term "liquidation of the
Company" shall mean (A) a termination of the Company effected in accordance with
this Operating Agreement, which shall be deemed to occur, for purposes of
Article 6, on the date upon which the Company ceases to be a going concern and
is continued in existence solely to wind-up its affairs, or (B) a termination of
the Company pursuant to Section 708(b)(1) of the Code; and (ii) the term
"liquidation of a Member's interest in the Company" shall mean the termination
of the Member's entire interest in the Company effected by a distribution, or a
series of distributions, by the Company to the Member.
ARTICLE 7
ADDITIONAL CAPITAL CONTRIBUTIONS
7.1 No Member shall be obligated to make additional capital
contributions to the Company. If the Managing Member, with the concurrence of
Members holding a majority in interest of the Company, shall determine there
shall be a Required Amount for any Company purpose, including, without
limitation, those purposes set forth in Article 5, then within fifteen (15) days
of notice of such requirement, each Member may, but shall not be obligated to,
contribute to the Company his Additional Contribution.
7.2 If a Member fails to make his Additional Contribution, in whole or
in part, as required in Section 7.1 above (the "Noncontributing Member"), then,
so long as any other Member shall make his Additional Contribution as provided
herein (each such Member making his Additional Contribution being hereinafter
referred to as "Contributing Member"), any Contributing Member shall have the
option (a) with the consent of a majority in interest of the Contributing
Members (i) to make a capital contribution equal to the Additional Contribution
not made by the Noncontributing Member or (ii) to make a Default Loan equal to
the Additional Contribution not made by the Noncontributing Member or (b) with
the unanimous written consent of each Contributing Member, to declare the
Company terminated as a result of the Noncontributing Member's default. In the
event that more than one Contributing Member desires to make an Additional
Contribution, or is permitted to make a Default Loan, on account of the
Noncontributing Member, each such Contributing Member shall be permitted to
participate in proportion to their respective Interests. All loans made pursuant
to this Section 7.2 shall bear interest at the Default Rate.
7.3 Upon the making of a capital contribution to the Company pursuant
to Section 7.2, the Interest of the Noncontributing Member and the Contributing
Members shall be adjusted as follows: (a) the Noncontributing Member's Interest
shall be decreased (but not below zero) by subtracting therefrom an amount equal
to the percentage equivalent of the quotient of (i) the Additional Contribution
not made by the Noncontributing Member giving rise to application of this
Section 7.3 multiplied by (A) 200% upon the first failure of the Noncontributing
Member to make an Additional Contribution, (B) 300% upon the second such failure
and (C) 400% upon the third such failure, divided by (ii) the aggregate amount
of all Capital Contributions made by the Members (including the Additional
Contributions received by the Company), and (b) the Contributing Members'
Interest shall be increased by adding thereto an amount equal to the percentage
by which the Noncontributing Member's Interest was decreased pursuant to clause
(a) above. Upon the fourth and each subsequent failure of the Noncontributing
Member to make an Additional Contribution giving rise to the application of this
Section 7.3, a majority-in-interest of the Contributing Members shall have the
option, exercisable in their sole discretion, to cause the remaining Interest of
the Noncontributing Member to be forfeited and allocated to the Contributing
Members or to continue re-allocating the Interests of the Noncontributing Member
and Contributing Members as provided in the preceding sentence except that the
percentage multiple set forth in clause (i) (C) shall be increased 100% for each
failure of the Noncontributing Member to make an Additional Contribution. An
example of the operation of this Section 7.3 with respect to a re-allocation of
Interests upon the first failure of a Noncontributing Member to make an
Additional Contribution, is set forth in Schedule B attached hereto.
7.4 The obligations of the Members contained in this Section 7 are
personal and run only to the benefit of the Company and the Members and may not
be enforced by any third parties. No creditor of the Company may rely on the
foregoing provisions of this Article 7 or any other provision of this Operating
Agreement to make any contributions or returns to the Company, notwithstanding
any agreement, representation, intention, indication or otherwise to the
contrary.
ARTICLE 8
CASH DISTRIBUTIONS
8.1 The Company shall distribute Income to the Members at such times as
the Company shall determine (but not less often than quarterly), in the
following order of priority:
(a) first, to any Member who made a Default Loan, to the
payment of accrued and unpaid interest, and the then outstanding principal
balance of, any Default Loan, such distribution to be proportion to the
aggregate amount of interest, and the principal, owed. If more than one Member
participates in the making of a Default Loan, then distributions to such Members
on account of this Section 8.1(a) shall be made in proportion to the amounts so
loaned. If there shall be more than one instance in which a Default Loan has
been made, then Default Loans shall be repaid in the order in which they shall
have been outstanding the longest;
(b) second, to the Members in an amount equal to and in
proportion to their Unrecovered Additional Contributions;
(c) next, to the Members in an amount sufficient to give them
a ten percent (10%) return compounded annually on the aggregate of their Capital
Contributions and Additional Contributions;
(d) next, to Sonia Seidman and the Managing Member in an
amount sufficient to pay to them, in the aggregate, up to twenty percent (20%)
of the net annual profits of the Company for each year calendar that the Company
is in existence to be paid 5% to the Managing Member and 15% to Sonia Seidman;
and
(e) the balance, if any, shall be distributed to the
Members in proportion to their Interests.
8.2 Notwithstanding Section 8.1, Net Proceeds from a Capital
Transaction which constitutes a liquidation of the Company, together with other
funds remaining to be distributed, shall be distributed to the Members no later
than the later of (a) the end of the taxable year of the Company in which such
liquidation occurs; or (b) within ninety (90) days after the date of such
liquidation event, after payment of all Company liabilities and expenses (or
adequate provision therefor), in accordance with Section 9.1, except that in no
event shall (x) a distribution be made to any Member if, after giving effect to
such distribution, all liabilities of the Company, other than liabilities to
Members on account of their Interests and liabilities for which the recourse of
creditors of the Company is limited to specified property of the Company, exceed
the fair value of the assets of the Company, except that the fair value of
property that is subject to a liability for which the recourse of creditors is
limited shall be included in the assets of the Company only to the extent that
the fair value of the property exceeds that liability and (y) the distribution
to a Member exceed the positive balance in such Member's Capital Account after
giving effect to all allocations to such Member under Article 9 of Net Profits,
Net Losses, and Gain and Loss from Capital Transactions so that liquidation
proceeds shall be distributed in accordance with each Member's positive Capital
Account balance (within the meaning of Treasury Regulation Section
1.704-1(b)(2)(ii)(b) as in effect on the date hereof). If a members shall
receive a distribution that should not have been made based upon the provisions
of Section 8.2 (x), the provisions of Section 42:2B-42 (b) of the act shall
apply . Section 42:2B-42(c) of the Act shall apply to all distributions made to
the Members.
ARTICLE 9
TAX ALLOCATIONS
10.1 Net Profits, Net Losses and any investment tax credit for each
fiscal year or part thereof shall be allocated to the Members in proportion to
their Interests.
10.2 Gain from a Capital Transaction shall be allocated in the
following order:
(a) There shall first be allocated to those Members, if any,
who have deficit balances in their Capital Accounts immediately prior to such
Capital Transaction an amount of such gain equal to the aggregate amount of such
deficit balances, which amount shall be allocated in the same proportion as such
deficit balances.
(b) There shall next be allocated to each of the Members gain
in proportion to (but not greater than) the amount by which (x) the amount of
Net Losses theretofore allocated to each Member and not theretofore taken into
account under this Section 9.2(b), exceeds (y) the gain allocated to such Member
under Section 9.2(a).
(c) There shall next be allocated to each of the Members gain
equal to the amount by which (x) the aggregate proceeds derived from a Capital
Transaction distributable to each Member in accordance with the provisions of
Section 8.1 or 8.2 other than with respect to Default Loans, as the case may be,
exceeds (y) the positive balance, if any, in such Member's Capital Account after
such Member's Capital Account has been adjusted to reflect the gain allocated to
such Member pursuant to Sections 9.2(a) and 9.2(b); provided, however, that if
there shall be an insufficient amount of gain determined by this Section 9.2(c),
then the gain shall be allocated to the Members in proportion to the respective
amounts determined pursuant to this Section 9.2(c).
(d) Any remaining gain shall be allocated among the
Members in proportion to their
Interests.
(e) If the Company shall realize, upon a Capital Transaction,
gain which is treated as ordinary income under Sections 1245 or 1250 of the
Code, such ordinary income shall be allocated to the Members who receive the
allocation of the depreciation or cost recovery deduction that generated the
ordinary income in the same proportions as such deductions.
(f) Notwithstanding the foregoing, distributions of Income
made to a Member for interest and in repayment of the principal on any Default
Loan shall not be treated as Income for the purpose of allocating gain pursuant
to this Section 9.2 or for any other purpose. Any interest on a Default Loan
shall be treated as a "guaranteed payment" for purposes of Section 707(c) of the
Code.
10.3 Losses from Capital Transactions shall be allocated in the
following order:
(a) There shall first be allocated to those Members, if any,
whose positive balances in their Capital Accounts exceed their Unrecovered
Additional Contributions, an amount of such loss equal to such excess amount,
which amount shall be allocated in the same proportion as such excess amounts.
(b) There shall next be allocated to those Members, if any,
that have positive balances in their Capital Accounts, an amount of such loss
equal to the aggregate amount of such positive balances, which amount shall be
allocated in the same proportion as such positive balances.
(c) The balance of such loss shall be allocated to the
Members in proportion to their Percentage Interests.
10.4 Notwithstanding the preceding provisions of this Article 10:
(a) Except as provided in sub-section (e) below, no allocation
of loss or deduction shall be made to a Member if such allocation would cause at
the end of any taxable year a deficit in such Member's Adjusted Capital Account
to exceed his allocable share of Minimum Gain; and any such loss or deduction
not allocated to a Member by reason of this Section 9.4 shall be allocated
pro-rata to each other Member if and to the extent that such allocation shall
not create a deficit in such other Member's Adjusted Capital Account in excess
of his allocable share of Minimum Gain; provided, however, that if such
allocation would create such deficit in all Members' Adjusted Capital Accounts
in excess of their share of Minimum Gain, then such allocation shall be made in
accordance with the principles of Treasury Regulation Section 1.704-1(b).
(b) If, during any taxable year, there is a net decrease in
Minimum Gain then, before any other allocations are made for such year, each
Member shall be allocated items of Company income and gain for such year (and,
if necessary, subsequent years) in an amount equal to each Member's share of the
net decrease in Company Minimum Gain (within the meaning of Treasury Regulation
Section 1.704-2(g)(2)) in a manner so as to satisfy the requirements of Treasury
Regulation Section 1.704-2(f).
(c) If, during any taxable year, there is a net decrease in
Company Minimum Gain Attributable to Member to Member Nonrecourse Debt, then,
before any other allocations are made for such year other than those pursuant to
Section 9.4(b) above, each Member with a share of the Company Minimum Gain
Attributable to Member Nonrecourse Debt at the beginning of the year shall be
allocated items of Company income and gain for such year (and, if necessary, for
subsequent years) in an amount equal to each Member's share of the net decrease
in Minimum Gain Attributable to Member Nonrecourse Debt as determined in
accordance with Treasury Regulation Section 1.704-2(i)(4) in a manner so as to
satisfy the requirements of said Treasury Regulation.
(d) If during any taxable year a Member unexpectedly receives
(i) a distribution of cash or property from the Company or (ii) an adjustment or
allocation described in either Treasury Regulation Section
1.704-1(b)(2)(ii)(d)(4) as in effect on the date hereof (concerning depletion
allowances with respect to oil and gas properties) or Treasury Regulation
Section 1.704-1 (b) (2) (ii) (d) (5) as in effect on the date hereof (concerning
allocations of loss and deduction in interests change during the year, if an
interest is acquired by gift or if a Member receives certain Company property in
redemption of part or all his interest), and if such adjustment, allocation or
distribution would cause at the end of the taxable year a deficit balance in
such Member's adjusted capital account in excess of his allocable share of
Minimum Gain, then a pro-rata portion of each item of Company income, including
gross income, and gain for such taxable year (and, if necessary, subsequent
taxable years) shall be allocated to such Member in an amount and in a manner
sufficient to eliminate such excess balance as quickly as possible before any
other allocation is made for such year other than pursuant to Section 9.4(b)
above so as to satisfy the requirements of Treasury Regulation Section
1.704-1(b) (2) (ii) (d) (qualified income offset).
(e) To the extent required by Treasury Regulation Section
1.704-2(i) (1), Member Nonrecourse Debt Deductions for any taxable year shall be
allocated to the Member (or Members) who bear(s) the economic risk of loss of
such Member Nonrecourse Debt.
(f) In the event that any allocation is or has been made to a
Member pursuant to Sections 9.4(a), (b), (c), (d) or (e) above, subsequent items
of income, deduction, gain and loss shall be allocated before any other
allocations are made (subject to the provisions of said Sections) to the Members
in the manner which would result in each Member having a Capital Account balance
equal to what it would have been had the allocation pursuant to said Sections.
(g) Upon the occurrence of an event described in Section
6.4(c), all Company property shall be revalued on the Company's books at fair
market value, Capital Accounts will be adjusted in accordance with Section 6.4
(c), and subsequent allocations of taxable income, gain, loss and deductions
shall, solely for tax purposes, be made necessary so as to take account of the
variation between the adjusted tax basis and the fair market value of such
property in accordance with Section 704 of the Code and the Treasury Regulations
thereunder.
(h) For the purposes of this Article, each Member's "Adjusted
Capital Account" shall equal the Capital Account of each Member (1) reduced at
the end of each taxable year by the sum of (x) the excess of distributions
reasonable expected to be made to such Member over the offsetting increases to
such Member's Member's Capital Account reasonably expected to be made in the
same taxable year as the aforesaid distributions, (y) adjustments expected to be
made to such Member's Capital Account described in Treasury Regulation Section
1.704-1(b) (2) (ii) (d) (4) as in effect on the date hereof (concerning
depletion allowances with respect to oil and gas properties), and (z)
allocations expected to be made described in Treasury Regulation Section 1.704-1
(b) (2) (ii) (d) (5) as in effect on the date hereof (concerning allocations of
loss and deduction if Interests change during the year, if an Interest is
acquired by gift or if a Member receives certain Company property in redemption
of part or all of his Interest in the Company), and (2) increased by the sum of
(i) the amount, if any, which the Member is obligated to restore the Company
upon liquidation of his Interest if a deficit balance exists in his Capital
Account at such time, (ii) the outstanding principal balance of any promissory
note made by such Member and contributed to the company if such note is not
readily tradable on an established securities market and if such note must be
satisfied within ninety (90) days after the date said Member's Interest is
liquidated and (iii) the sum of (a) the amount the Member would be personally
liable for either as a Member or in his individual capacity as a guarantor or
otherwise, and (b) the economic risk of loss the Member would bear attributable
to any Company liability (as determined in accordance with Treasury Regulation
Section 1.752-2).
(i) In accordance with Section 704(b) and (c) of the Code and
Regulations thereunder, income, gain, loss and deduction with respect to any
property contributed to the capital of the Company (including all or part of any
deemed capital contribution under Section 708 of the Code) shall, solely for tax
purposes, be allocated among the Members so as to take account of any variation
between the adjusted basis of such property to the Company and its agreed value.
In the event that Capital Accounts are ever adjusted pursuant to Treasury
Regulation Section 1.704-1(b) (2) to reflect the fair market value of any
Company property, subsequent allocations of income, gain, loss and deduction
with respect to such asset shall take account of any variation between the
adjusted basis of such asset and its value as adjusted in the same manner as
required under Section 704(c) of the Code and the Regulations thereunder.
(j) The allocations provided in this Section 10.4 are intended
to comply with the provisions of Section 704(b) of the Code and the regulations
thereunder. However, if any such allocation causes a distortion in the Members'
Interest in contravention of the Members' economic arrangement as reflected in
Article 6, the Company has the authority to make curative allocations to bring
such allocations in accordance with such Member's Interest, as if such
allocations which caused the distortion had not occurred and to bring such
allocations in compliance with Section 794(b) of the Code and regulations
thereunder.
ARTICLE 10
RIGHTS, POWERS AND REPRESENTATIONS OF THE MEMBERS
10.1 All decisions, consents, authorizations and rights in connection
with the business and affairs the company shall be carried on and managed by a
majority in interest of the Members, which shall have full, exclusive and
complete discretion with respect thereto. Any Member or person acting pursuant
to any authority granted to him in writing by a majority in interest of the
Members shall have all necessary and appropriate powers to carry out the
authority so granted, and no other Member or person without such authority so
granted shall have the right to take any action or give any consent, by
affirmative act or acquiescence, to any matter or thing, affecting the Company,
Premises or Project. In furtherance of the foregoing, any Member or person so
authorized as provided above may:
(a) negotiate, execute, deliver and perform on behalf of, and
in the name of, and in the name of, the Company any and all contracts, deeds,
assignments, deeds of trust, leases, subleases, promissory notes and other
evidences of indebtedness, mortgages, bills of sale, financing statements,
security agreements, easements, stock powers, and any and all other instruments
necessary or incidental to the business of the Company and the financing
thereof,
(b) borrow money, without limit as to amount, and to secure
the payment thereof by mortgage, pledge, or assignment of, or security interest
in, all or any part of the assets then owned or thereafter acquired by the
Company,
(c) effectuate the purpose of the Company as provided in
Article 5 hereof,
(d) establish, maintain and draw upon checking and other
accounts of the Company,
(e) execute any notifications, statements, reports, returns or
other filings that are necessary or desirable to be filed with any state or
Federal agency, commission or authority,
(f) enter into contracts in connection with the business
of the Company,
(g) arrange for facsimile signatures for the Members in
executing and all documents, papers, checks or other writings or legal
instruments which may be necessary or desirable in the Company business, and
(h) execute, ackowledge and deliver any and all contracts,
documents and instruments deemed appropriate to carry out any of the foregoing
purposes and intent of this Operating Agreement.
10.2 In the management of the Company, and with respect to any and all
decisions with respect to the Company and its business and the conduct of its
operations, the Members of the Company shall have a cumulative total of one
hundred (100) votes, and each Member shall have the number of votes equal to
his/her Interest. Wherever and whenever the word "majority" appears in this
Operating Agreement, either as a noun or as an adjective, it shall mean for all
purposes that number of Members whose votes when considered or added together
constitute more than fifty (50) of the total one hundred (100) votes of all the
Members. Any act or decision of any of the Members may be confirmed, overruled
or precluded by the majority of the Members.
10.3 Each of the Members, on their own behalf and on behalf of anyone
who shall represent their Interests, hereby waives notice of the time, place or
purpose of any meeting at which any matter is to be voted on by the Members or
anyone acting by or for them, waives any requirement that there be such a
meeting and agrees that any action may be taken by consent without a meeting.
10.4 The fact that the Members are directly or indirectly interested in
or connected with any person, firm or corporation employed by the Company to
render or perform a service, or from which or whom the Company may buy
merchandise, material or other property shall not prohibit the Company from
employing such persons, firms or corporations, or from otherwise dealing with
him under such reasonable terms and conditions as the Company may determine.
ARTICLE 11
MANAGING MEMBER
11.1 Notwithstanding any provision contained in Article 10 to the
contrary, the daily affairs of the Company shall be conducted by the Managing
Member who shall the power and authority to make ordinary and usual decisions
concerning the business and affairs of the Company. The Managing Member shall
have the power and authority, on behalf of the Company, to do the following:
(a) open one or more depository accounts and make
deposits into and checks and withdrawals against such accounts;
(b) invest the capital resources of the Company, in amounts
not to exceed one hundred and twenty-five percent (125%) of the capital of the
Company without the prior consent of a majority in interest of the Members, in
stocks, bonds and other securities of publically traded companies (collectively
"Permitted Investments"), including the ability to buy, sell, exchange, swap or
transfer such securities;
(c) open one or more cash or margin brokerage accounts in
the name of the Company for purposes of making Permitted Investments;
(d) obtain insurance covering the business and affairs
of the Company;
(e) commence, prosecute or defend any proceeding in the
Company's name; and
(f) enter into any and all agreements and execute any
and all contracts, documents and instruments necessary or required to
effectuate the foregoing.
11.2 Notwithstanding any provision contained in this Operating
Agreement to the contrary, it is specifically agreed between the Members that
the Company shall make no investment in Cali Realty Corporation without the
unanimous prior consent of all Members.
11.3 (a) The Managing Member shall perform and discharge his duties as
a manager in good faith, with the care an ordinary prudent person in a like
position would exercise under similar circumstances, and in a manner he
reasonably believes to be in the best interests of the Company. The Managing
Member shall not be liable for any monetary damages to the Company for any
breach of such duties except for: receipt of a financial benefit to which the
Manager is not entitled; voting for or assenting to a distribution to Members in
violation of this Operating Agreement or the Act; a knowing violation of the
Law; fraud; or a willful breach of fiduciary obligations owed to the Members.
(b) The Managing Member shall devote a significant amount of
his time and efforts to furthering the business and investments of the Company
and any other corporations and partnerships formed to invest in the stock in
private and public companies or real estate assets and mortgages. The Managing
Member shall also be permitted to perform consulting and legal services for
Environmental Waste Management Associates, Inc., its principal shareholders,
Richard Greenberg, and for Glenn Woo and other real estate related clients. In
compensation equal to $125,000, payable quarterly.
11.4 Unless otherwise provided by law or expressly assumed, a person
who is a Member or manager, or both, shall not be liable for the acts, debts or
liabilities of the Company.
11.5 The Company shall indemnify the Managing Member and each other
Member and may indemnify and employee or agent of the Company who was or is a
party or is threatened to be made a party to threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative, or
investigative, and whether formal or informal, other than action by or in the
right of the Company, by reason of the fact that such person is or was a
manager, employee or agent of the Company against expenses, including attorneys
fees, judgements, penalties, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with the action, suit or
proceeding, if the person acted in good faith, with the care an ordinary prudent
person in a like position would exercise under similar circumstances, and in a
manner that such person reasonably believed to be in the best interests of the
Company and with respect to a criminal action or proceeding, if such person had
no reasonable cause to believe such person's conduct was unlawful. To the extent
that a Member, employee or agent of the Company has been successful on the
merits or otherwise in defense of an action, suit or proceeding or in defense of
any claim, issue or other matter in the action, suit or proceeding, such person
shall be indemnified against actual and reasonable expenses, including attorneys
fees incurred by such person in connection with the action, suit or proceeding
and any action, suit or proceeding brought to enforce the mandatory
indemnification provided herein. Any indemnification permitted under this
Article, unless ordered by a court, shall be made by the Company only as
authorized in the specific case upon a determination that the indemnification is
proper under the circumstances because the person to be indemnified has met the
applicable standard of conduct and upon an evaluation of the reasonableness of
expenses and amount paid in settlement. This determination and evaluation shall
be made by a majority vote of the Members who are not parties or threatened to
be made parties to the action, suit or proceeding. Notwithstanding the foregoing
to the contrary, no indemnification shall be provided to the Managing Member or
any other Member, employee or agent of the Company for or in connection with the
receipt of a financial benefit to which such person is not entitled, voting for
or assenting to a distribution to Members in violation of this Operating
Agreement of the Act, or a knowing violation of law.
ARTICLE 12
BOOKS, RECORDS AND REPORTS
12.1 At all times during the continuance of the Company, the Company
shall keep or cause to be kept full and true books of account, in which shall be
entered fully and accurately each transaction of the Company. The books of
account, together with an executed copy of the Certificate of Formation of the
Company and any amendments thereto, shall at all times be maintained at the
principal office of the Company and shall be open to inspection and examination
by the members or their representatives at reasonable hours and upon reasonable
notice. For purpose hereof, the Company shall keep its books and records on the
same method of accounting employed for tax purposes.
12.2 The fiscal year of the Company shall be the calendar year. Within
a reasonable time after the end of each fiscal year and in any event on or
before thirty (30) days prior to the filing date for individual tax returns
(including extensions), the accountants for the Company shall deliver to each
Member (a) upon request of a Member, an annual statement of the Company's
accountants, and (b) a report or a tax return setting forth such Member's share
of the Company's profit or loss for such year and such Member's allocable share
of all items of income, gain, loss, deduction and credit for Federal income tax
purposes.
12.3 The Company shall also cause to be prepared and filed all Federal,
state and local tax returns required of the Company. All books, records, balance
sheets, statements, reports and tax returns required pursuant to Section 12.1
and 12.2 hereof shall be prepared at the expense of the Company.
ARTICLE 13
BANK ACCOUNTS
13.1 All funds and income of the Company (a) shall be deposited in the
name of the Company in such bank account or accounts as shall be designated by
the Managing Member, (b) shall be invested in such Permitted Investments as
Managing Member shall determine and (c) shall be kept separate and apart from
the funds of any other individual or entity.
13.2 Withdrawals from any such bank account or accounts shall be made
upon the signature of any person so designated by the Company in writing.
ARTICLE 14
RIGHTS AND DUTIES OF MEMBERS
14.1 Subject to duties and obligations of the Managing Member, it is
expressly understood that each Member may engage in any other business or
investment, whether or not in direct competition with the business of the
Company, and neither the Company nor any other Member shall have any rights in
and to said businesses or investments, or the income or profits derived
therefrom.
14.2 The Managing Member may employ, on behalf of the Company, such
persons, firms or corporations, including those firms or corporations in which
any Member has an interest, and on such terms as the Managing Member shall deem
advisable in the operation and management of the business of the Company,
including, without limitation, such accountants, attorneys, architects,
engineers, contractors, appraisers and experts.
14.3 No Member shall be personally liable to the Company or any of the
other Members for any act or omission performed or omitted by him, except if
such act or omission was attributable to willful misconduct or gross negligence.
14.4 Each Member (and each former Member) shall be indemnified and
saved harmless by the Company from any loss, damage or expense incurred by him
by reason of any act or omission performed or omitted by him, except if such act
or omission was attributable to willful misconduct or gross negligence.
ARTICLE 15
TAX MATTERS
15.1 (a) Notwithstanding any provisions hereof to the contrary, each of
the Members hereby recognizes that the Company will be a partnership for United
States federal income tax purposes and that the Company will be subject to all
provisions of Subchapter K of Chapter 1 of Subtitle A of the Code; provided,
however, that the filing of U.S. Partnership Returns of Income shall not be
construed to extend the purposes of the company or expand the obligations or
liabilities of the Members. At the request of any Member, the Company shall file
an election under Section 754 of the Code.
(b) The Company shall engage an accountant (the "Accountant")
to prepare at the expense of the company all tax returns and statements, if any,
which must be filed on behalf of the Company regarding the Premises and the
operation, dissolution and liquidation of the Company with any taxing authority.
(c) Lawrence Seidman is designated Tax Matters Member (herein
"TMM") for purposes of Chapter 63 of the Code and the Members will take such
actions as may be necessary, appropriate, or convenient to effect the
designation of Lawrence Seidman as TMM. The TMM shall attempt to comply with the
responsibilities outlined in this Section 15.1 and in Sections 6222 through 6231
of the Code (including any Treasury Regulations promulgated thereunder).
ARTICLE 16
BANKRUPTCY OF A MEMBER
16.1 Unless a majority in interest of the Members shall elect
otherwise, a Member shall cease to be a Member of the Company:
(a) if he/she/it:
(i) Makes an assignment for the benefit of
creditors;
(ii) Files a voluntary petition in bankruptcy;
(iii) Is adjudged bankrupt or insolvent, or has
entered against him an order for relief, in any bankruptcy or insolvency
proceeding;
(iv) Files a petition or answer
seeking for himself/herself/itself any
reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar
relief under any statute, law or regulation;
(v) Files an answer or other pleading
admitting or failing to contest the
material allegations of a petition filed against him/
her/it in any proceeding of this nature; or
(vi) Seeks, consents to or acquiesces in
the appointment of a trustee,
receiver or liquidator of the Member or of all or
any substantial part of his/her/its
properties; or
(b) One hundred twenty (120) days after the commencement of
any proceeding against the Member seeking reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief under any
statute, law or regulation, if the proceeding has not been dismissed, or within
ninety (90) days after the appointment without his consent or acquiescence of a
trustee, receiver or liquidator of the Member or of all or any substantial part
of his/her properties, the appointment is not vacated or stayed, or within
ninety (90) days after the expiration of any such stay, the appointment is not
vacated.
ARTICLE 17
ASSIGNABILITY, TRANSFER OR PLEDGE OF
INTERESTS; RESIGNATION OF MEMBER
17.1 (a) No Member shall have the right to assign, convey, sell or
otherwise transfer or dispose of, or pledge, mortgage, hypothecate or otherwise
encumber his/her/its Interest, whether record or beneficial interest thereof,
without the prior written consent of the Company. Notwithstanding the preceding
sentence, but subject to the restrictions on transferability required by law, or
set forth in any instrument or agreement by which the Company may be bound, or
which may be contained in this Operating Agreement, an individual Member, if
any, may, without any consent, assign, convey, sell or otherwise transfer or
dispose of all or any portion of his interest in the Company to any one or more
of the members of his/her immediate family or families (defined for the purposes
of this Operating Agreement as a mother, father, sister, brother, son, daughter,
stepson, stepdaughter or spouse (in each instance whether by marriage or
otherwise)) and/or a trust or other entity for the benefit thereof or
themselves, by a written instrument of assignment and assumption, provided that
the instrument of transfer provides for the assumption of the assignor's
liabilities and obligations hereunder and has been duly executed by the assignor
of such interest and by the transferee. The Member shall notify the Company of
any assignment, transfer or disposition of a beneficial interest in any interest
of the Member which occurs without a transfer of record ownership, although such
notification, or the absence of a response thereto, shall not be deemed a
consent thereof.
(b) An assignee or transferee of any portion of the interest
of the Member shall be entitled to receive allocations and distributions
attributable to the interest acquired by reason of such assignment from and
after the effective date of the assignment of such interest to such assignee;
however. anything herein to the contrary notwithstanding, the Company shall be
entitled to treat the assignor of such interest of the Member as the absolute
owner thereof in all respects, and shall incur no liability for allocations of
net income, net losses, or gain or loss on sale of Company property, or
transmittal of reports and notices required to be given to Members hereunder
which are made in good faith to such assignor until such time as the written
assignment has been received by the Company, approved and recorded on its books
and the effective date of the assignment has passed. Provided that the Company
has actual notice of any assignment of the interest of the Member, the effective
date of such assignment on which the assignee shall be deemed an assignee of
record shall be the date set forth on the written instrument of assignment.
(c) Any assignment, sale, exchange, transfer or other
disposition in contravention of any of the provisions of this Article 17 and
Article 18 hereof shall be void and ineffective and shall not bind or be
recognized by the Company.
(d) In the event that there shall be more than one assignee,
transferee, representative or other successor in interest as permitted herein
(collectively, the "Transferees") and the Member as of the date of this
Operating Agreement shall remain a Member, then the Member shall be authorized
to act, and shall so act, on behalf of the Member and all of the Transferees
acting as such by, through or under the Member. In the event that there shall be
more than one Transferee, and the Member as of the date of this Operating
Agreement shall no longer be a Member, then the Company must be advised by the
Member whose interest is the subject of such event or failing which by a
two-thirds (2/3) majority in interest of those holding any portion of the
interests of the Member, of one person to act on behalf of all the Transferees.
The Member, if the first sentence of this paragraph shall be applicable, or the
person so noted to the Company, if the second sentence of this paragraph shall
be applicable, shall be authorized to act, and shall so act, for all of the
Transferees, all of whom shall be bound by any decision or action taken by such
person, and the Company, the Company and all of the other Members, shall be
entitled to rely on the decisions or actions taken by such person. Until the
Company shall be advised as to the identity of such person, (i) the Transferees
shall be entitled only to distributions and tax allocations as provided in
Article 8 and 9 hereof, but shall have no right, power or authority with respect
to any decision making reserved herein to the Members or any of them and (ii)
wherever in this Operating Agreement provision shall be made for the Members to
make decisions with respect to Company matters, the interests of the Member, as
transferred to the Transferees, shall not be included in determining whether the
requisite interest of members have consented to or approved of such decision.
17.2 Without the prior written consent of all Members and other than as
provided in Section 6.1(b) above, a Member may not resign from the Company prior
to the dissolution and winding up of the Company.
ARTICLE 18
ADMISSION OF SUBSTITUTED MEMBERS;
DEATH OR INCAPACITY; FURTHER CONDITIONS
18.1 No assignment or transfer of all or any part of the interest of a
Member permitted to be made under this Operating Agreement shall be binding upon
the Company unless and until a duplicate original of such assignment or
instrument of transfer, duly executed and acknowledged by the assignor and the
transferee, has been delivered to the Company.
18.2 As a condition to the admission of any substituted Member, as
provided in Article 17 hereof, the person so to be admitted shall execute and
acknowledge such instruments, in form and substance reasonably satisfactory to
the Company, as a majority in interest of the Members may deem necessary or
desirable to effectuate such admission and to confirm the agreement of the
person to be admitted as a Member to be bound by all of the covenants, terms and
conditions of this Operating Agreement, as the same may have been amended.
18.3 Any person to be admitted as a member pursuant to the provisions
of this Operating Agreement shall, as a condition to such admission as a Member,
pay all reasonable expenses in connection with such admission as a Member,
including, but not limited to, the cost of the preparation, filing and
publication of any amendment to this Operating Agreement and/or Certificate of
Formation.
18.4 In the event of the death or adjudication of incompetency of a
Member, or upon the happening of any event described in Article 16, the
executor, administrator, committee or other legal representative of such Member,
or the successor in interest of such Member, shall succeed only to be right of
such Member to receive allocations and distributions hereunder, and may be
admitted to the Company as a Member in the place and stead of the deceases,
incompetent, or bankrupt Member in accordance with this Article 18, but shall
not be deemed to be a substituted Member unless so admitted. Such event,
however, shall cause a termination or dissolution of the Company within one
hundred twenty (120) days of such event unless a majority in interest of the
Members shall elect to continue the Company within said one hundred twenty (120)
day period.
18.5 Notwithstanding anything to the contrary contained in this
Operating Agreement, no sale or exchange of an interest in the Company may be
made if the interest sought to be sold or exchanged, when added to the total of
all other interests sold or exchanged within the period of twelve (12)
consecutive months prior thereto, results in the termination of the Company
under Section 708 of the Code without the prior written consent of a majority in
interest of the Members.
18.6 In the event of a permitted transfer of all or part of the
interest of a Member, the Company shall, if requested, file an election in
accordance with Section 754 of the Code or a similar provision enacted in lieu
thereof, to adjust the basis of the Property of the Company. The Member
requesting said election shall pay all costs and expenses incurred by the
Company in connection therewith.
ARTICLE 19
LIQUIDATION
19.1 Upon the dissolution of the Company, the Company shall be
liquidated and its assets distributed as required by Section 42:2B-51 of the
Act.
19.2 The assets of the Company shall be liquidated as promptly as
possible, but in an orderly and businesslike manner so as not to involve undue
sacrifice.
19.3 In the event that any proceeds are to be distributed to the
Members same shall be distributed, if practicable, no later than the later of
(i) the end of the taxable year of the Company in which such liquidation occurs;
or (ii) within ninety (90) days after the date of such liquidation event.
19.4 In any liquidation, the Company's assets shall be used first to
pay the costs and expenses of the dissolution and liquidation. The liquidation
trustee (which may be a Member) shall be entitled to establish reserves to
provide for any contingent or unforeseen liabilities or obligations of the
Company.
19.5 With respect to distributions to Members, said distributions
shall be made:
(a) first, to the repayment of any accrued and unpaid interest
on, and the then outstanding principal balance of, any Default Loan, in
proportion to the aggregate amount of interest, and then principal, owed, and if
more than one Member shall have made a Default Loan, then in proportion to the
amounts so loaned. If there shall be more than one instance in which a Default
loan has been made, the Default loans shall be repaid in the order in which they
shall have been outstanding the longest;
(b) second, to the payment of an obligation owed
pursuant to Section 11.3 (c).
(c) third, to all Members in proportion to and to the extent
of any remaining positive balances in such Member's Capital Account
after giving effect to all locations to such Member under Article 10 of
this Operating Agreement so that liquidation proceeds shall be
distributed in accordance with each Member's positive Capital Account
balance (within the meaning of Treasury Regulation Section 1.704-1(b)
(2) (ii) (b) as in effect on the date hereof); and
(d) last, to all Members pro rata in accordance with
their Company Interests.
ARTICLE 20
GENDER
20.1 All terms and words used in this Operating Agreement, regardless
of the sense or gender in which they are used, shall be deemed to include each
other sense and gender unless the context requires otherwise.
ARTICLE 21
FURTHER ASSURANCES
21.1 The Members agree immediately and from time to time to execute,
acknowledge, deliver, file, record and publish such further certificates,
amendments to certificates, instruments and documents, and to do all such other
acts and things as may be required by law, or as may, in the opinion of a
majority in interest of the Members, be necessary or advisable to carry out the
intent and purposes of this Operating Agreement.
ARTICLE 22
COVENANT AGAINST PARTITION
22.1 The Members, on behalf of themselves, their legal representatives,
heirs, successors and assigns, hereby specifically renounce, waive and fofeit
all rights whether arising under contract, statute, or by operation of law, to
seek, bring, or maintain any action for partition in any court of law or equity
pertaining to any real property which the Company may now or in the future own,
regardless of the manner in which title to any such property may be held.
ARTICLE 23
NOTICES
23.1 Unless otherwise specified in this Operating Agreement, all
notices, demands, requests or other communications which any of the parties to
this Operating Agreement may desire or be required to give hereunder
(hereinafter referred to collectively as "Notices") shall be in writing and
shall be given by mailing the same by postage prepaid certified or registered
mail, return receipt requested, or by nationally recognized overnight courier to
the appropriate Member at the address set forth in this Operating Agreement.
Notices given in compliance with the provisions of this Article shall be deemed
given one (1) business day after delivery to a nationally recognized overnight
courier or four (4) business days after mailing in a repository of the United
States Postal Service.
ARTICLE 24
APPLICABLE LAW
24.1 The parties agree that the parties shall be governed by, and this
Operating Agreement construed in accordance with, the laws of the State of New
Jersey applicable to agreements made and to be performed in such state and that
all claims and suits shall be heard in the courts located in the State of New
Jersey.
ARTICLE 25
CAPTIONS
25.1 All section titles or captions contained in this Operating
Agreement are for convenience only and shall not be deemed a part of this
Operating Agreement.
ARTICLE 26
COUNTERPARTS
26.1 This Operating Agreement may be executed in counterparts and each
counterpart so executed by each Member shall constitute and original, all of
which when taken together shall constitute one agreement, notwithstanding that
all the parties are not signatories to the same counterpart.
ARTICLE 27
BINDING EFFECT
27.1 This Operating Agreement may not be changed, modified, waived or
discharged, in whole or in part, unless in writing and signed by all of the
Members. This Operating Agreement shall be binding upon the Members and their
respective executors, administrators, legal representatives, heirs, successor
and assigns. The singular of any defined term or term used herein shall be
deemed to include the plural.
ARTICLE 28
PARTIAL INVALIDITY
28.1 If any term or provision of this Operating Agreement or the
application thereof to any person or circumstance shall to any extent be invalid
or unenforceable, the reminder of this Operating Agreement or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable shall not be affected thereby and each term
and provision of this Operating Agreement shall be valid and enforced to the
fullest extent permitted by law.
ARTICLE 29
INTEGRATION
29.1 This Operating Agreement is the entire agreement among the parties
with respect to the subject matter hereof and supersedes all prior agreements
relative to such subject matter.
IN WITNESS WHEREOF, the parties hereto have executed this Operating
Agreement as of the day and year first above written.
/S/ Lawrence Seidman
/S/ Sonia Seidman
/S/ SEIDCAL ASSOCIATES
By:
/S/ Angelo R. Cali, Partner
/S/ Paul Schmidt
/S/ Richard Greenberg
SCHEDULE A
Required Contributions
Lawrence Seidman
$50,000
Sonia Seidman
$200,000
SEIDCAL Associates
$1,500,000
Paul Schmidt
$100,000
Richard Greenberg
$250,000
SCHEDULE B
PERCENTAGE INTEREST
Lawrence Seidman:
%
Sonia Seidman:
%
SEIDCAL Associates:
%
Paul Schmidt:
%
Richard Greenberg:
%
SCHEDULE B
EXAMPLE OF THE OPERATION OF SECTION 7.3
Assume the following facts:
(a) The interests are as follows:
A 10%
B 30%
C 60%
(b) The aggregate capital contributions made by the Members in
proportion to their respective interests is $2,000,000.
(c) The Company requires additional funds of $1,000,000.
(d) A and B each contribute their Additional Contributions to the
Company ($100,000 and $300,000, respectively) and C fails to contribute his
Additional Contribution ($600,000).
(e) B contributes C's Additional Contribution to Company.
The amount that C's Interest is decreased and the amount that B's
Interest is increased is computed as follows:
(i) Multiply the amount of the contribution not made by C
($600,000) by 200% resulting in a product of $1,200,000;
(ii) Divide the result of (i) above ($1,200,000) by the aggregate
amount of all capital
contributions made by the Members ($3,000,000), resulting in a product of .40;
(iii) Convert the product arrived at in computation (ii) above (.40) to
a percentage (by multiplying the same by 100) resulting in 40%. Subtract such
percentage from the Company Interest of C (40%) resulting in a new Interest for
C of 20%; and
(iv) Increase the Interest of B (30%) by adding thereto the same
Percentage that was subtracted from Member C (40%) resulting in a new Interest
for B of 70%.
FIRST AMENDMENT TO OPERATING AGREEMENT
FOR SEIDMAN & ASSOCIATES, L.L.C.
THIS AMENDMENT is made on July , 1998, by and between LAWRENCE SEIDMAN,
having an address at 19 Veteri Place, Wayne, New Jersey 07470, SONIA SEIDMAN,
having an address at 19 Veteri Place, Wayne, New Jersey 07470; SEIDCAL
ASSOCIATES, L.L.C., a New Jersey limited liability company, having an address
c/o Mack-Cali Realty Corporation, 11 Commerce Drive, Cranford, New Jersey 07016;
PAUL SCHMIDT, having an address at 159 Clinton Place, Hackensack, New Jersey
07601; and RICHARD GREENBERG, having an address at 1235A Route 23 South, Wayne,
New Jersey 07474 (hereinafter referred to collectively as the "Members").
W I T N E S S E T H:
WHEREAS, the Members previously formed a limited liability company known as
Seidman & Associates, L.L.C. (the "Company") pursuant to the New Jersey Limited
Liability Company Act; and
WHEREAS, the Members entered into an Operating Agreement for the Company,
dated November 1994; and
WHEREAS, the Members desire to amend the Operating Agreement, pursuant to
Article 27 thereof, in accordance with the terms and provisions set forth below.
NOW, THEREFORE, the Members do hereby agree as follows:
1. INCORPORATION BY REFERENCE
Subject to the provisions of this Amendment, the definitions, terms and
conditions of the Operating Agreement are incorporated in this Amendment by
reference in the same manner and to the same extent as if such definitions,
terms and conditions were fully set forth in this Amendment.
2. AMENDMENT OF OPERATING AGREEMENT
2.1 Subparagraph 4.1(a) of the Operating Agreement be and the same is
hereby amended to read as follows:
4.1 The Company shall commence upon the filing of the Certificate of
Formation, and shall continue in full force and effect until May 1, 2024,
provided, however, that the Company shall be dissolved prior to such date upon
the happening of any of the following events:
(a) The mutual written consent of the Members to dissolve the Company;
provided, however, that the Company may not be dissolved by mutual consent prior
to December 31, 2000.
2.2 Subparagraph 11.3(c) of the Operating Agreement be and the same is
hereby amended to read as follows:
The Managing Member may be removed or replaced
any any time after December 31, 2000 by a majority in
interest of the Members, but if the Managing Member
is removed, he shall be entitled to receive $315,000.00
reduced by the payments already received pursuant
to Section 11.3(b), together with any other fees earned
prior to his removal.
2.3 Except as modified by Subparagraphs 2.1 and 2.2 of this Agreement, all
of the terms and conditions of the Operating Agreement shall remain in full
force and effect.
3. COVENANT OF FURTHER ASSURANCES
The Members agree that they shall execute and deliver any and all
additional writings, instruments, and other documents and take such further
action as shall reasonably be required in order to effectuate the provisions of
this Amendment.
IN WITNESS WHEREOF, the parties hereto have executed this First Amendment
to Operating Agreement as of the day and year first above written.
-----------------------
LAWRENCE SEIDMAN
-----------------------
SONIA SEIDMAN
[SIGNATURES CONTINUED ON NEXT PAGE]
SEIDCAL ASSOCIATES, L.L.C.
By:----------------------
-----------------------
Brant B. Cali, Member
-----------------------
PAUL SCHMIDT
-----------------------
RICHARD GREENBERG
LAWRENCE B. SEIDMAN, ESQ.
Lanidex Executive Center
100 Misty Lane
P. O. BOX 5430
Parsippany, New Jersey 07054
(973) 560-1400
March 30, 1999
Mr. Brant Cali, Executive Vice President
Mack-Cali Real Estate Corporation
11 Commerce Drive
Cranford, NJ 07016
Dear Brant:
This will confirm the agreement reached last week with Angelo
and John whereby my annual management fee from Seidman & Associates, LLC,
provided for in 11.3(b) of the Operating Agreement, shall be increased from
$125,000 to $250,000.
Very truly yours,
LAWRENCE B. SEIDMAN
LS:rr
EX-10.6
8
exf.txt
LETTER AGREEMENT WITH KERRIMATT, L.P.
EXHIBIT F
Lawrence B. Seidman, Esq.
Koll Executive Center
100 Misty Lane
P. O. Box 5430
Parsippany, NJ 07054
April 17, 1998
David M. Mandelbaum, Esq.
Mandelbaum & Mandelbaum
80 Main Street
West Orange, NJ 07052
Dear David:
The following are the terms and conditions in reference to the investment
account for the prchase of publicly traded bank and thrift stocks:
1. A brokerage account will be opened at Bear Stearns & Company in the name
of Kerrimatt L.P.
2. The account will be a discretionary account with Larry Seidman having a
revocable Power of Attorney to buy and sell stock in said account provided all
funds deposited into the account are for Kerrimatt L.P. and all stock purchased
in the account is in the name of Kerrimatt L.P.
3. The account will be funded with a maximum of $2,000,000 and will not be
margined.
4. Only shares of publicly traded bank and thrift stocks with their
principal operations located in New Jersey may be purchased. I will notify David
Mandelbaum, in writing, when I commence the purchase of the stock of any
individual entity.
5. Kerrimatt L.P. shall have the right to terminate the relationship
twenty-four months after the account is initially funded or in the event of a
breach by Larry Seidman of this Agreement.
6. Upon such termination, my discretion shall be terminated automatically
7. My compensation shall be 1/4 of 1% of the value of the assets in the
account computed as of the last day of each calendar quarter, but not to exceed
$5,000 per quarter. An incentive fee will be paid me equal to 20% of the net
profits earned in the account as of the termination date whether same shall be
Michael J. Mandelbaum, Esq.
April 17, 1998
Page 2
the two year anniversary date or later if agreed to between the parties. 100% of
all funds shall go to Kerrimatt L.P. until 100% of the capital plus a 8% annual
noncumulative return (the "Hurdle") is returned, and then the division shall be
80% to Kerrimatt L.P. and 20% to Larry Seidman.
8. Net profits, if any in excess of the hurdle, shall be defined to be
the amount earned in the account without regard to a "Hurdle" or without
regard to cash dividends. Cash dividends shall be the property of Kerrimatt
L.P. and shall not be included in net profits
9. I shall have the sole right to vote the shares in the account until
termination of my Power of Attorney.
10. In the event any portion of this agreement is not in compliance
with law, then Kerrimatt L.P. shall have the sole right to terminate this
letter, and an accounting shall be done based upon the above quoted
administrative fee and profit participation to the date of the termination.
Very truly yours,
LAWRENCE B. SEIDMAN
AGREED AND ACCEPTED:
KERRIMATT L.P.
By: David Mandelbaum, General Partner
EX-10.7
9
exg.txt
OPERATING AGREEMENT FOR FEDERAL HOLDINGS L.L.C.
EXHIBIT G
OPERATING AGREEMENT
FOR
FEDERAL HOLDINGS L.L.C.
Dated: June 12,1995
INDEX
Page No.
Article 1 Definitions
Article 2 Formation
Article 3 Principal Office
Article 4 Term and Duration
Article 5 Purpose
Article 6 Capital Contributions by the Members
Article 7 Additional Capital Contributions
Article 8 Distributions of Net Proceeds
Article 9 Tax Allocations and Distributions
Article 10 Rights, Powers and Representations of the Investment
Manager and Administrative Manager; Management Fee
Article 11 Books, Records and Reports
Article 12 Indemnification
Article 13- Tax Matters
Article 14- Death, Dissolution or Bankruptcy of A Member
Article 15- Assignability, Transfer or Pledge of
Interests; Resignation of A Member
Article 16- Admission of Substituted Members;
Incapacity; Further Condition
Article 17 Liquidation
Article 18 Miscellaneous
Schedule A - Members' Percentage Interests and Capital
Contributions
OPERATING AGREEMENT
FOR
FEDERAL HOLDINGS L.L.C.
AGREEMENT made June 12,1995 by and among the members listed on Schedule A
annexed hereto (individually, a "Member" and collectively, the "Members").
W I T N E S S E T H:
WHEREAS, the Members desire to form a limited liability company pursuant to the
New York Limited Liability Company Law (the "Law") and adopt this Agreement in
connection therewith; and
WHEREAS, by executing this Agreement, each Member represents that it has
sufficient right and authority to execute this Agreement and is not acting on
behalf of any undisclosed or partially disclosed principal.
NOW, THEREFORE, in consideration of ten ($10) dollars and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows effective as of the date first
written above.
ARTICLE 1
DEFINITIONS
1.1 For purposes of this Agreement, the following terms shall have the
definitions set forth below:
"Account": As defined in Section 10.4
"Additional Member": Means any person or entity other than the Members of
the Company as of the date hereof who acquires an interest in the Company.
"Administrative Manager': Kevin Moore.
"Advance": As defined in Section 7.2.
"Agreement": This Operating Agreement as originally executed and as amended,
modified, supplemented or restated
from time to time.
"Articles of Organization": The Articles of Organization of the Company filed
with the Secretary of State of the State of New York, pursuant to the Law to
form the Company, as originally executed and as amended, modified, supplemented
or restated from time to time.
"Capital Account" or "Capital Accounts": As defined in Section 6.4.
"Capital Contributions": The respective capital contributions, including any
additional Capital Contribution,of each Member to the Company.
"Capital Transaction" or "Capital Transactions": Any transaction which, in
accordance with generally accepted accounting principles consistently applied,
is treated as a capital transaction including, without limitation, any sale of
all or substantially all of the assets of the Company.
"Closing Price": As defined in Section 16.4
"Code": The Internal Revenue Code of 1986, as amended, and any reference
to a particular section of the Code shall be deemed to include any successor
section to such section.
"Company": FEDERAL HOLDINGS L.L.C., a New York limited liability company.
"Contributing Member": A Member which has made its additional Capital
Contribution.
"Current Market Value": As defined in Section 16.4.
"Fair Market Value": As defined in Section 16.4.
"Gain from a Capital Transaction": The gain recognized by the Company
attributable to a Capital Transaction, determined in accordance with the method
of accounting used by the Company for federal income tax purposes.
"Interest": The respective percentage interest of each Member as set forth on
Schedule A.
"Investment Manager": Shall mean Lawrence Seidman, subject to the provisions
of Section 10.5.
"Loss from a Capital Transaction": The loss recognized by the Company
attributable to a Capital Transaction, determined in accordance with the method
of accounting used by the Company for federal income tax purposes.
"Management Fee": As defined in Section 10.2.
"Member": Means each of the parties who has executed this Agreement and any
party who may hereafter become an Additional Member or a Substitute Member
pursuant to this Agreement.
"Net Proceeds": As defined in Section 8.1.
"Net Profit" and "Net Loss": The net income (including income exempt from tax)
and net loss (including expenditures that can neither be capitalized nor
deducted), respectively, of the Company, determined in accordance with the
method of accounting used by the Company for federal income tax purposes, but
computed without regard for Gain from Capital Transactions, Loss from Capital
Transactions and items of income or loss, if any, that are specially allocated
to Members. In the event there is a revaluation of Company assets and the
Capital Accounts are adjusted pursuant to Section 704(b) of the Code and
applicable regulations promulgated thereunder, Net Profits and Net Losses shall
be computed by reference to the "book items" and not corresponding "tax items".
"Preferred Return": With respect to a Member, an amount equal to 7.5% per annum
simple interest (prorated for any partial year) on the amount of such Member's
Unrecovered Capital Contribution, from time to time, calculated from the date a
Capital Contribution is made.
"Substitute Member": Any transferee of a Member's Interests who is admitted
as a Member in the Company pursuant to Article 15 or 16.
"Trading Day": As defined in Section 16.4.
"Unrecovered Capital Contribution": For any Member, the aggregate amount of
capital contributed by such Member reduced by the aggregate amount of capital
theretofore distributed to such Member pursuant to Articles 16 and 17.
"Unrecovered Preferred Return": For any Member an amount equal to the
Preferred Return reduced by the aggregate amount of distributions theretofore
made to such Member pursuant to Section 8.1(b)(i).
"Unrecovered 20% IM Fee": An amount equal to 20% of the aggregate annual
Preferred Return for all Members divided by .8, reduced by the aggregate amount
of distributions of Net Proceeds theretofore made pursuant to Section 8.1(b)
(ii).
ARTICLE 2
FORMATION
2.1 The parties hereto do hereby form the Company under the name of FEDERAL
HOLDINGS L.L.C. pursuant to the Law.
In order to maintain the Company as a limited liability company under the laws
of the State of New York, the Company shall from time to time take appropriate
action, including the preparation and filing of such amendments to the Articles
of Organization and such other assumed name certificates, documents, instruments
and publications as may be required by law, including, without limitation,
action to reflect:
(i) a change in the Company name;
(ii) a correction of a defectively or erroneously executed Articles of
Organization;
(iii) a correction of false or erroneous statements in the Articles of
Organization or the desire of the Members to make a change in any statement
therein in order that it shall accurately represent the agreement among the
Members; or
(iv) a change in the time for dissolution of the Company as stated in
the Articles of Organization and in this Agreement.
2.2 Each Member hereby agrees to execute and deliver to the Company within five
(5) days after receipt of a written request therefor, such other and further
documents and instruments, statements of interest and holdings, designations,
powers of attorney and other instruments and to take such other action as the
Company deems necessary, useful or appropriate to comply with any laws, rules or
regulations as may be necessary to enable the Company to fulfill its
responsibilities under this Agreement, to preserve the Company as a limited
liability company under the Law and to enable the Company to be taxed as a
partnership for federal and state income tax purposes.
ARTICLE 3
PRINCIPAL OFFICE
3.1 The Company's registered office in New York shall be at 30 Wall
Street, Ninth Floor, New York, New
York. The Company's registered agent who is a resident of New York is
Jonathan A. Bernstein, Esq. whose business address is Pryor, Cashman,
Sherman & Flynn, 410 Park Avenue, New York, New York 10022. At any time, the
Company may designate another registered agent and/or office.
3.2 The principal place of business of the Company shall be at 30 Wall Street,
Ninth Floor, New York, New York. At any time, the Company may change the
location of its principal place of business and may establish additional
offices.
ARTICLE 4
TERM AND DURATION
4.1 The Company shall commence upon the filing of the Articles of Organization,
and shall continue in full force and effect until April 30, 2045; provided,
however, that the Company shall be dissolved prior to such date upon the
happening of any of the following events:
(a) The mutual written consent of all of the Members to dissolve the
Company;
(b) The divestiture or distribution of all or substantially
all of the assets of the Company, (other than a transfer to a nominee of the
Company for any Company purpose, which event shall not be construed as an event
of termination);
(c) The entry of a decree of judicial dissolution under Section 702 of the
Law; or
(d) The happening of any other prior event which pursuant to the terms and
provisions of this Agreement shall cause a dissolution or termination of the
Company.
4.2 Upon any dissolution of the Company, the liquidation of the Company's assets
and the winding up of its affairs shall be concluded in accordance with Article
17 of this Agreement.
ARTICLE 5
PURPOSE
5.1 The purpose of the Company is to legally or beneficially acquire, own, sell,
transfer, hold and vote shares of common stock, preferred stock, convertible or
exchangeable securities of any bank, bank holding company, savings and loan
association or trust company (hereinafter referred to as "Stock") and to enter
into any contracts or commitments, assume any obligation, execute any documents
and do any and all other acts and things, either directly or in conjunction with
others through corporations, joint ventures, partnerships, trusts, limited
liability companies or otherwise, which may be necessary, incidental or
convenient to carry on the business of the Company as contemplated by this
Agreement. The Company may also sell covered calls, repurchase such calls and
buy puts, but the Company shall not sell uncovered calls or puts.
5.2 The purpose of the Company shall also be for any other lawful purpose for
which the Members shall herewith agree in writing by amendment to this
Agreement.
ARTICLE 6
CAPITAL CONTRIBUTIONS BY THE MEMBERS
6.1 Each Member shall contribute to the capital of the Company the amounts
set forth on Schedule A.
6.2 No Member shall have the right to withdraw any part of his Capital
Contribution or receive any distribution, except in accordance with the
provisions of this Agreement. No interest shall be paid on any Capital
Contribution other than the Preferred Return.
6.3 No Member shall have any priority over any other Member with respect to the
return of Capital Contributions.
6.4 The Company shall maintain a capital account (a "Capital Account") for each
Member within the provisions of Treasury Regulation Section 1.704-1(b) (2) (iv)
as such regulation may be amended from time to time.
6.5 To the extent not inconsistent with the foregoing, the following shall
apply:
(a) The Capital Account of each Member shall be credited with (1) an amount
equal to such Member's cash contributions and the fair market value of property
contributed to the Company by such Member (net of liabilities securing such
contributed property that the Company is considered to assume or take subject to
under Section 752 of the Code) and (2) such Member's share of the Company's Net
Proceeds (or items thereof) and Gain from a Capital Transaction. The Capital
Account of each Member shall be debited by (1) the amount of cash distributions
to such Member and the fair market value of property distributed to such Member
(net of liabilities assumed by such Member and liabilities to which such
distributed property is subject) and (2) such Member's share of the Company's
Net Losses (or items thereof) and Loss from a Capital Transaction.
(b) Upon the transfer of an Interest in the Company after the date of this
Agreement, (x) if such transfer does not cause a termination of the Company
within the meaning of Section 708 (b) (1) (B) of the Code, the Capital Account
of the transferor Member that is attributable to the transferred Interest will
be carried over to the transferee Member but, if the Company has a Section 754
election in effect, the Capital Account will not be adjusted to reflect any
adjustment under Section 743 of the Code, or (y) if such transfer causes a
termination of the Company within the meaning of Section 708 (b) (1) (B) of the
Code, the income tax consequences of the deemed distribution of the property and
of the deemed immediate contribution of the property to a new Company (which for
all other purposes continues to be the Company) shall be governed by the
relevant provisions of Subchapter K of Chapter 1 of the Code and the regulations
promulgated thereunder, and the initial Capital Accounts of the Members in the
new Company shall be determined in accordance with Treasury Regulation Sections
1.704-1(b) (2) (iv) (d, (e), (f), (g), and (i) and thereafter in accordance with
Section 6.5 (a).
(c) Upon (i) the "liquidation of the Company" (as hereinafter defined), (ii) the
"liquidation of a Member's Interest in the Company" (as hereinafter defined),
(iii) the distribution of money or property to a Member as consideration for an
Interest in the Company , or (iv) the contribution of money or (if permitted
pursuant to (a) above) property to the Company by a new or existing Member as
consideration for an Interest in the Company, or upon any transfer causing a
termination of the Company for tax purposes within the meaning of Section 708
(b) (1) (B) of the Code, then adjustments shall be made to the Members' Capital
Accounts in the following manner: All property of the Company which is not sold
in connection with such event shall be valued at its then "agreed value". Such
"agreed value" shall be used to determine both the amount of gain or loss which
would have been recognized by the Company if the property had been sold for its
agreed value (subject to any debt secured by the property) at such time, and the
amount of Net Proceeds, as the case may be, which would have been distributable
by the Company pursuant to Section 9.2 if the property had been sold at such
time for said value, less the amount of any debt secured by the property. The
Capital Accounts of the Members shall be adjusted to reflect the deemed
allocation of such hypothetical gain or loss in accordance with Section 9.1. The
Capital Accounts of the Members (or of a transferee of a Member) shall
thereafter be adjusted to reflect "book items" and not tax items in accordance
with Treasury Regulation Section 1.704 1(b) (2) (iv) (g) and 1.704-1(b) (4) (i).
(d) For purposes of this Section 6.5, (i) the term "liquidation of the Company"
shall mean (A) a termination of the Company effected in accordance with this
Agreement, which shall be deemed to occur, for purposes of this Article 6, on
the date upon which the Company ceases to be a going concern and is continued in
existence solely to wind-up its affairs, or (B) a termination of the Company
pursuant to Section 708 (b) (1) of the Code; and (ii) the term "liquidation of a
Member's Interest in the Company" shall mean the termination of the Member's
entire Interest in the Company effected by a distribution, or a series of
distributions, by the Company to the Member.
ARTICLE 7
ADDITIONAL CAPITAL CONTRIBUTIONS
7.1 No Member shall be obligated to make additional Capital Contributions to the
Company. If the Administrative Manager determines that the Company shall need
additional funds for any Company purpose, including, without limitation, (a)
those purposes set forth in Article 5, or (b) cash in excess of Net Proceeds in
order to satisfy any obligations and liabilities of the Company, then within
fifteen (15) days of notice of such requirement, each Member may, but shall not
be obligated to, contribute to the Company his pro rata share.
If a Member elects to make an additional Capital Contribution and another Member
forgoes contributing additional capital, the Company shall, for purposes of
distributions and allocations, recompute each Member's percentage Interest in
the Company in proportion to the total capital contributed to the Company such
that thereafter each Member's Interest shall be equal to the percentage that
such Member's aggregate Capital Contribution theretofore made to the Company
bears to the total Capital Contributions theretofore made by all the Members.
7.2 A Member may from time to time, upon the consent of the Administrative
Manager but without the consent of a majority in interest of the Members,
advance additional monies (an "Advance") to or for the benefit of the Company,
and such advances shall not be treated as Capital Contributions but shall be
considered as loans to be repaid upon demand together with annual interest at a
rate not less than the lowest applicable federal rate of interest which allows
for the avoidance of imputed or unstated interest, for federal income tax
purposes. Such loans shall be evidenced by a promissory note executed and
delivered by the Company to the Member making such Advance.
ARTICLE 8
DISTRIBUTIONS OF NET PROCEEDS
8.1 (a) Net Proceeds shall be computed and distributed by the Company once, on
an aggregated basis of all stocks in which the Company has traded, at the
earlier of (i) a determination by the Investment Manager in his sole discretion,
(ii) the resignation or other termination of the Investment Manager, (iii) the
liquidation or winding up of the Company or (iv) the end of the Management Term.
"Net Proceeds" shall be defined as dividends received, interest income, all net
trading profits (i.e. proceeds from the sale of Stock less the Company's basis
in the Stock) less all expenses (including but not limited to brokerage
commissions, the Management Fee and other applicable accounting or professional
fees but not including the Unrecovered 20% IM Fee) all as computed in accordance
with generally accepted accounting principles.
(b) Net Proceeds shall be distributed as follows:
(i) first, to the Members, pro rata, an amount equal to each Member's cumulative
Unrecovered Preferred Return in proportion to their Unrecovered Preferred Return
until the Preferred Return shall be paid in full;
(ii) second, to the Investment Manager an amount equal to the Unrecovered
20% IM Fee; and
(iii) the balance, if any, shall be paid 80% to the Members in proportion
to their Interests and 20% to the Investment Manager.
(c) If Stock cannot be readily sold because of the lack of its liquidity in the
market or if the Administrative Manager elects not to sell the Stock at the time
of a distribution of Net Proceeds, the Company shall calculate the fair market
value of the Stock by averaging the closing sale prices (or if there is no sale
on a particular day, the average closing bid and ask prices) for the five
consecutive trading days preceding the date of computation. Thereafter, based
upon its valuation, the Company shall calculate the amount of Net Proceeds that
would be distributed if the Stock had actually been sold for its fair market
value (including all applicable commissions). The Company shall then distribute
the Stock in kind in accordance with Section 8.1(b) as if the Stock were Net
Proceeds.
(d) Notwithstanding Section 8.1(c), if the Investment Manager makes a
determination to distribute Net Proceeds in accordance with Section 8.1(a)(i)
and the Stock cannot be readily sold because of its lack of liquidity in the
market, the Investment Manager shall liquidate the Stock in an orderly fashion
over a six (6) month period. Thereafter, Net Proceeds shall be distributed in
accordance with Section 8.1(b).
8.2 Notwithstanding Section 8.1, Net Proceeds from a Capital Transaction which
constitutes a liquidation of the Company, together with other funds remaining to
be distributed, shall be distributed to the Members no later than the later of
(a) the end of the taxable year of the Company in which such liquidation occurs
or (b) within ninety (90) days after the date of such liquidation event, after
payment of all Company liabilities and expenses (or adequate provision therefor)
including the Management Fee, except that in no event shall (x) a distribution
be made to any Member if, after giving effect to such distribution, all
liabilities of the Company, other than liabilities to Members on account of
their Interests and liabilities for which the recourse of creditors of the
Company is limited to specified property of the Company, exceed the Fair Market
Value (as defined in Section 16.4(c)) of the assets of the Company, except that
the Fair Market Value of assets that is subject to a liability for which the
recourse of creditors is limited shall be included in the assets of the Company
only to the extent that the Fair Market Value of those assets exceeds that
liability and (y) the distribution to a Member exceed the positive balance in
such Member's Capital Account after giving effect to all allocations to such
Member under Article 9 50 that liquidation proceeds shall be distributed in
accordance with each Member's positive Capital Account balance (within the
meaning of Treasury Regulation Section 1.704-1(b)(2)(ii)(~ as in effect on the
date hereof). If a Member shall receive a distribution that should not have been
made based upon the provisions of Section 8.2(x), the provisions of Section
508(b) of the Act shall apply. Section 508(c) of the Law shall apply to all
distributions made to the Members.
ARTICLE 9
TAX ALLOCATIONS AND DISTRIBUTIONS
9.1 The Net Profits of the Company for each fiscal year shall be allocated
among the Members as follows:
(a) First to the Members in an amount equal to, and in proportion to,
the aggregate amount of Net Losses
theretofore allocated to each Member; and
(b) Thereafter, in proportion to their respective Interests in the Company
Any credit available for income tax purposes shall be allocated among the
Members in proportion to their respective Interests in the Company.
9.2 Gain from a Capital Transaction shall be allocated in the following
order:
(a) There shall first be allocated to those Members, if any, who have deficit
balances in their Capital Accounts immediately prior to such transaction, an
amount of such gain equal to the aggregate amount of such deficit balances,
which amount shall be allocated in the same proportion as such deficit balances.
(b) There shall next be allocated to each of the Members, gain equal to the
amount by which (x) the aggregate Net Proceeds derived from such transaction
distributable to each Member in accordance with the provisions of Section 8.1(b)
(i) and (iii), assuming such amounts are distributable, exceeds (y) the positive
balance, if any, in such Member's Capital Account after such Member's Capital
Account has been adjusted to reflect the gain allocated to such Member pursuant
to paragraph (a) above; provided, however, that if there shall be an
insufficient amount of gain determined by this paragraph, then the gain shall be
allocated to the Members in proportion to the respective amounts determined
pursuant to this paragraph.
(c) Any remaining gain shall be allocated among the Members in
proportion to their respective Interests in the Company.
(d) If the Company shall realize, upon such transaction, gain which is treated
as ordinary income under Section 1245 or 1250 of the Code, such ordinary income
shall be allocated to the Members who receive the allocation of the depreciation
or cost recovery deduction that generated the ordinary income, which amount
shall be allocated in the same proportions as such deductions.
9.3 Net Losses of the Company shall be allocated among the Members as follows:
(a) First, to the Members in proportion to their respective positive
Capital Account balances until such balances are reduced to zero; and
(b) The balance shall be allocated to the Members in proportion to their
respective Interests in the Company.
9.4 Loss from a Capital Transaction from the sale or other disposition of all or
substantially all of the assets shall be allocated in the following order:
(a) First, to those Members, if any, who have positive balances in their Capital
Accounts, an amount of such loss equal to the aggregate amount of such positive
balances, which amount shall be allocated in the same proportion as such
positive balances; and
(b) The balance of such loss shall be allocated to the Members in
proportion to their respective Interests in the Company
9.5 Notwithstanding the foregoing provisions of Article 9:
(a) In accordance with Sections 704 (b) and (c) of the Code and the Treasury
Regulations thereunder, income, gain, loss and deduction with respect to any
property contributed to the capital of the Company (including all or part of any
deemed Capital Contribution under Section 708 of the Code) shall, solely for tax
purposes, be allocated among the Members so as to take into account any
variation between the adjusted basis of such property to the Company and its
agreed value. In the event that Capital Accounts are ever adjusted pursuant to
Treasury Regulation Section 1.704-1(b) (2) to reflect the fair market value of
any Company property, subsequent allocations of income, gain, loss and deduction
with respect to such asset shall take account of any variation between the
adjusted basis of such asset and its value as adjusted in the same manner as
required under Section 704 (c) of the Code and the Treasury Regulations
thereunder.
(b) At no time shall any allocation of losses be made to a Member if such
allocation would cause the deficit in the Member's adjusted Capital Account, if
any, to exceed his allocable share of "Company Minimum Gain" or "Minimum Gain
Attributable to Member Nonrecourse Debt" (as defined in Treasury Regulation
Sections 1.704-2 (g) (1) and (i) (5), respectively), and any losses not
allocated to a Member by reason of this clause (b) shall be allocated to each
Member whose deficit, if any, in the Member's adjusted Capital Account of such
Member shall not exceed his allocable share of such minimum gain by reason of
such allocation.
(c) If there is a net decrease in the Company's minimum gain (within the meaning
of Treasury Regulation Section 1.704-2 (g) (2)) for a Company taxable year and,
at the end of such taxable year, the deficit, if any, in a Member's Capital
Account exceeds his allocable share of such minimum gain, gross income of the
Company shall be allocated to such Member in an amount equal to such excess so
as to satisfy the requirements of Treasury Regulation Section 1.704-2 (f)
(minimum gain chargeback).
(d) If, during any taxable year, there is a net decrease in Company Minimum Gain
Attributable to Member Nonrecourse Debt, then, before any other allocations are
made for such year other than those pursuant to clause (b) above, each Member
with a share of the Company Minimum Gain Attributable to Member Nonrecourse Debt
at the beginning of the year shall be allocated items of Company income and gain
for such year (and, if necessary, for subsequent years) in an amount equal to
each Member's share of the net decrease in Minimum Gain Attributable to Member
Nonrecourse Debt as determined in accordance with Treasury Regulation Section
1.704-2 (i) (4) in a manner so as to satisfy the requirements of said Treasury
Regulation.
(e) If, during any taxable year, a Member unexpectedly receives an adjustment,
allocation or distribution described in paragraph (4), (5) or (6) of Treasury
Regulation Section 1.704-1(b) (2) (ii) (~, and if such adjustment, allocation or
distribution would cause at the end of the taxable year a deficit balance in
such Member's Capital Account in excess of his allocable share of minimum gain
as described above, then such Member shall be allocated items of income and gain
for such taxable year (and, if necessary, subsequent taxable years) in an amount
and in a manner sufficient to eliminate such excess balance as quickly as
possible before any other allocation is made for such year, other than pursuant
to Sections 9.5(b) and (c), so as to satisfy the requirements of Treasury
Regulation Section 1.704-1(b) (2) (ii) (~ (qualified income offset).
(f) In the event any Member has a deficit balance in his Capital Account at the
end of the fiscal year which is in excess of the sum of (i) the amount such
Member is obligated to restore pursuant to any provision of this Agreement, if
any, and (ii) the amount such Member is deemed to be obligated to restore
pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2
(g) (1) and 1.704-2 (i) (5), each Member shall be specially allocated items of
Company income and gain in the amount of such excess as quickly as possible.
ARTICLE 10
RIGHTS, POWERS AND REPRESENTATIONS
OF THE INVESTMENT MANAGER AND
ADMINISTRATIVE MANAGER: MANAGEMENT FEE
10.1 The Investment Manager shall have the full, exclusive and complete power
and authority to buy, sell and vote the Stock. The Investment Manager shall have
all necessary and appropriate powers to carry out the authority so granted, and
no other party, including any Member, shall have the right to take any action
with respect to the acquisition, sale or voting of the Stock. "Management Term"
shall mean a term of two (2) years commencing on the date hereof, unless sooner
terminated by the Administrative Manager for cause. The Administrative Manager
may terminate the Investment Manager for cause upon 30 days written notice to
the Investment Manager setting forth with specificity the grounds for
termination. For purposes of this Section, "cause" means any willful (i)
dissemination of genuine trade secrets or other confidences of the Company or
any of its affiliates by the Investment Manager; (ii) dishonesty of the
Investment Manager as punishable by criminal law or for which the Investment
Manager would be liable to the Company or its affiliates under civil law; (iii)
deliberate activity of the Investment Manager which is prejudicial to the
interests of the Company or its affiliates; and (iv) deliberate failure by the
Investment Manager to perform any of his material obligations hereunder which is
not cured by the Investment Manager within 30 days after ~ from the Company of
such failure. In the event of a termination of the Investment Manager under this
Section, or upon the death or adjudication of incompetency of the Investment
Manager, the Company shall, within 30 days, make a distribution of Net Proceeds
in accordance with Section 8.1 above.
10.2 The Company shall pay the Investment Manager a Management Fee. The
"Management Fee" shall be equal to .25% of the Fair Market Value (as defined
Section 16.4(c)) of the assets of the Company, payable quarterly, on the last
day of March, June, September and December of each calendar year of the
Management Term. The Management Fee shall be prorated as to the first such
quarter and upon the termination, resignation, death or adjudication of
incompetency of the Investment Manager
10.3 Except for the matters set forth in Section 10.1, all other decisions,
consents, authorizations and rights in connection with the management of the
Company shall be made, given or performed, as the case may be, by the
Administrative Manager. In furtherance of the foregoing, the Administrative
Manager may: i (a) negotiate, execute, deliver and perform on behalf of, and in
the name of, the Company any, wire transfer instructions, disbursement
authorizations, agreements, contracts, promissory notes and other evidences of
indebtedness, and any and all other instruments necessary or incidental to the
business of the Company and the financing thereof;
(b) to secure the payment thereof by all or any part of the assets then
owned or thereafter acquired by the
Company;
(c) effectuate the purpose of the Company as provided in Article 5 hereof;
(d) establish, maintain and draw upon any brokerage, money market,
demand deposit, checking and other accounts of the Company;
(e) execute any notifications, statements, reports, returns or other filings
that are necessary or desirable to be filed with any state or federal agency,
commission or authority;
(f) enter into contracts in connection with the business of the Company;
(g) retain professionals, accountants, lawyers, consultants as the
case may be to further the purpose and business of the Company;
(h) arrange for facsimile signatures for the Members in executing any and all
documents, papers, checks or other writings or legal instruments which may be
necessary or desirable in the Company's business;
(i) execute, acknowledge and deliver any and all contracts, documents and
instruments deemed appropriate to carry out any of the foregoing purposes and
intent of this Agreement;
(j) establish reserves for anticipated expenses, debts and obligations
incident to the operation of the Company's business; and
(k) perform all other duties and make all other decisions in furtherance of the
management and operation of the Company's business in accordance with the Law
except as otherwise set forth in this Agreement.
10.4 The Administrative Manager, on behalf of the Company, shall establish a
brokerage account (the "Account") at Spear, Leeds and Kellogg or any other
brokerage company (the "Broker") approved by the Administrative Manager through
which the Investment Manager shall have the exclusive power and authority to
direct the Broker to disburse the funds necessary to acquire Stock and to sell
Stock. The Investment Manager shall have no power or authority to cause funds to
be disbursed from the Account other than for the purpose of acquiring Stock. Any
withdrawals of any kind from the Account shall be made by the Administrative
Manager.
10.5 Upon the expiration of the Management Term, the Administrative Manager
shall, upon the concurrence of the Investment Manager, have the right to extend
the Management Term or, in his sole discretion, select a successor Investment
Manager. The duties of a successor Investment Manager shall commence upon the
date so designated by the Administrative Manager, and from and after such date,
the prior existing Investment Manager shall be relieved of all duties and
obligations with respect to the Company, shall no longer hold himself or herself
out to any other person or entity as the Investment Manager of the Company,
shall turn over to the Administrative Manager any and all books and records of
the Company, and shall take such action as the Company shall request in order to
effectuate such discharge and termination. No such discharge shall affect any
obligations of the Company to the Investment Manager, including reimbursement
and indemnity obligations as set forth herein or in the Law.
10.6 The fact that the Members, the Investment Manager or the Administrative
Manager are directly or indirectly interested in or connected with any person,
firm or corporation employed by the Company to render or perform a service, or
from which or whom the Company may buy merchandise, material, services or other
property shall not prohibit the Company from employing such persons, firms or
corporations, or from otherwise dealing with such persons, firms or corporations
so long as such terms and conditions are equivalent to those available at the
Company and the transaction was on an arms-length basis.
ARTICLE 11
BOOKS, RECORDS AND REPORTS
11.1 At all times during the continuance of the Company, the Administrative
Manager shall keep or cause to be kept full and true books of account, in which
shall be entered fully and accurately each transaction of the Company. The books
of account, together with an executed copy of the Articles of Organization of
the Company and any amendments thereto, shall at all times be maintained at the
principal office of the Company and shall be open to inspection and examination
by the Members or their representatives at reasonable hours and upon reasonable
notice. For purposes hereof, the Company shall keep its books and records on the
same method of accounting employed for tax purposes.
11.2 The fiscal year of the Company shall be the calendar year. Within a
reasonable time after the end of each fiscal year and in any event on or before
thirty (30) days prior to the filing date for individual tax returns (including
extensions), the accountants for the Company shall deliver to each Member (a) an
annual statement of the Company's receipts and expenses for such year and the
Capital Account of such Member as of the end of each such year, prepared by the
Company's accountants, and (b) a report or a tax return setting forth such
Member's share of the Company's profit or loss for such year and such Member's
allocable share of all items of income, gain, loss, deduction and credit for
federal income tax purposes.
11.3 The Company shall also cause to be prepared and filed all federal, state
and local tax returns required of the Company. All books, records, balance
sheets, statements, reports and tax returns required pursuant to this Section 11
shall be prepared at the expense of the Company.
11.4 In accordance with Section 301(e) of the Law,. the Administrative Manager
shall cause to be prepared and filed biennially the requisite statements for
which service of process shall be accepted by the Secretary of State on behalf
of the Company.
ARTICLE 12
INDEMNIFICATION
12.1 Subject to the limitations and conditions provided in this Article 12 and
in the Law, each person ("Indemnified Person") who was or is made a party or is
threatened to be made a party to or is involved in any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative,
arbitrative or investigative ("Proceeding"), or any appeal in such a Proceeding
or any action or investigation that could lead to such a Proceeding, by reason
of the fact that any manager or member was or is a Member, a Manager or an
officer of the Company or was or is the legal representative of or a manager,
director, officer, member, venturer, proprietor, trustee, employee, agent or
similar functionary of a Member, shall be indemnified by the Company against
judgments, penalties (including excise and similar taxes and punitive damages),
fines, settlements and reasonable costs and expenses (including, without
limitation, attorneys' fees) actually incurred by such Indemnified Person in
connection with such Proceeding if such Indemnified Person acted in good faith
and in a manner he reasonably believed to be in, or not opposed to, the best
interests of the Company and, with respect to any criminal action or proceeding,
had no reasonable cause to believe his conduct was unlawful. The termination of
any Proceeding by judgment, order, settlement, conviction, or upon a plea of
nolo contendere or its equivalent, shall not, of itself, create a presumption
that the Indemnified Person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the Company
or, with respect to any criminal action or proceeding, that the Indemnified
Person had reasonable cause to believe that such conduct was unlawful.
12.2 Subject to the limitations and conditions provided in this Article 12 and
in the Law, the Company shall and does hereby indemnify any person who was or is
a party, or is threatened to be made a party, to any threatened, pending or
completed action or suit by or in the right of the Company to procure a judgment
in its favor by reason of the fact that such person is or was a Member, a
Manager or an officer of the Company, the legal representative of a Member or
officer, or manager, director, officer, member, venturer, proprietor, trustee,
employee, agent or similar functionary of a Member against expenses (including
attorneys' fees) actually and reasonably incurred by such person in connection
with the defense or settlement of such action or suit, if such person acted in
good faith and in a manner he reasonably believed to be in, or not opposed to,
the best interests of the Company, provided that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall have
been adjudged to be liable for negligence or misconduct in the performance of
his duty to the Company unless, and only to the extent that, the court in which
such action or suit was brought shall determine upon application that, despite
the adjudication of liability, but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such expenses as
the court shall deem proper.
12.3 To the extent that a person has been successful, on the merits or
otherwise, in the defense of any action, suit or proceeding referred to in
Sections 12.1 or 12.2, or in defense of any claim, issue or matter there;-' such
person shall be indemnified against expenses (including attorneys' fee3)
actually and reasonably incurred by such person in connection therewith.
12.4 Any indemnification under Sections 12.1 or 12.2 (unless ordered by a court)
shall be made by the Company except upon a reasonable determination that
indemnification is proper in the circumstances because such person has not met
the applicable standard of conduct set forth therein; and if such standard is
met indemnification shall be mandatory. Such determination shall be made (i) by
the holders of a majority of the Interests held by Members who were not parties
to such action, suit or proceedings, or (ii) if such a quorum is not obtainable,
or even if obtainable, if a quorum of disinterested Members so directs, by the
Company's independent legal counsel in a written opinion.
12.5 Indemnification under this Article 12 shall continue as to a person who has
ceased to serve in the capacity which initially entitled such person to
indemnity hereunder. The rights granted pursuant to this Article 12 shall be
deemed contract rights, and no amendment, modification or repeal of this Article
12 shall have the effect of limiting or denying any such rights with respect to
actions taken or Proceedings arising prior to any such amendment, modification
or repeal.
12.6 The right to indemnification conferred by this Article 12 shall include the
right to be paid or reimbursed by the Company for the reasonable expenses
incurred in advance of the final disposition of the Proceeding and without any
determination as to the person's ultimate entitlement to indemnification;
provided, however, that the payment of such expenses incurred in advance of the
final disposition of a Proceeding shall be made only upon delivery to the
Company of a written affirmation by such person of his good faith belief that he
has met the standard of conduct necessary for indemnification under this Article
12 and a written undertaking, by or on behalf of such person, to repay all
amounts so advanced if it shall ultimately be determined that such person is not
entitled to be indemnified under this Article 12 or otherwise.
12.7 The right to indemnification and the advancement and payment of expenses
conferred by this Article 12 shall not be exclusive of any other right which a
person may have or hereafter acquire under any law (common or statutory),
provision of the Articles of Organization or this Agreement, agreements, vote of
Members or otherwise.
12.8 Insurance. The Company may purchase and maintain insurance, at its expense,
to protect itself and any Indemnified Person against any expense, liability or
loss, whether or not the Company would have the power to indemnify such person
against such expense, liability or loss under this Article 12.
12.9 Savings Clause. If Sections 12.1,12.2 or any portion thereof shall be
invalidated on any ground by any court of competent jurisdiction, then the
Company shall nevertheless indemnify and hold harmless each Indemnified Person
as to costs, charges and expenses (including attorneys' fees), judgments, fines
and accounts paid in settlement with respect to any action, suit or proceeding,
whether civil, criminal, administrative or investigative to the full extent
permitted by any applicable portion of this Article 12 that shall not have been
invalidated and to the fullest extent permitted by applicable law.
ARTICLE 13
TAX MATTERS
13.1 (a) Notwithstanding any provisions hereof to the contrary, each of the
Members hereby recognizes that the Company will be a Company for United States
federal income tax purposes and that the Company will be subject to all
provisions of Subchapter K of Chapter 1 of Subtitle A of the Code; provided,
however, that the filing of United States Company Returns of Income shall not be
construed to extend the purposes of the Company or expand the obligations or
liabilities of the Members. At the request of any Member, the Company shall file
an election under Section 754 of the Code.
(b) The Company shall engage an accountant (the "Accountant") to prepare at the
expense of the Company all tax returns and statements, if any, which must be
filed on behalf of the Company regarding the operation, dissolution and
liquidation of the Company with any taxing authority.
(c) The Administrative Manager is designated the Tax Matters Member (herein
"TMM") for purposes of Chapter 63 of the Code and the Members will take such
actions as may be necessary, appropriate, or convenient to effect the
designation of the Administrative Manager as TMM. The TMM shall attempt to
comply with the responsibilities outlined in this Section 13.1 and in Sections
6222' through 6231 of the Code (including any Treasury Regulations promulgated
thereunder.
ARTICLE 14
DEATH, DISSOLUTION OR
BANKRUPTCY OF A MEMBER
14.1 Upon the death, dissolution, resignation, retirement, expulsion,
adjudication of bankruptcy or adjudication of incompetency of a Member, the
Company shall be dissolved and its affairs shall be wound up unless within 180
days after such event, the Company is continued by the vote of the majority in
Interest of the Members (which approval may be granted or withheld in such
Member's sole discretion). In the event the Company is continued, such Member
(a) making an assignment for the benefit of creditors; (b) filing a voluntary
petition in bankruptcy; (c) being adjudged bankrupt or insolvent, or having
entered against him an order for relief, in any bankruptcy or insolvency
proceeding; (d) filing a petition or answer seeking for himself any
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under any statute, law or regulation; (e) filing an answer or
other pleading admitting or failing to contest the material allegations of a
petition filed against him in any proceeding of this nature; or (f) seeking,
consenting to or acquiescing in the appointment of a trustee, receiver or
liquidator of the Member or of all or any substantial part of its assets, shall
not be entitled to vote on any matters regarding the operation of the Company
except for matters described in Articles 14 and 15.
ARTICLE 15
ASSIGNABILITY, TRANSFER OR PLEDGE OF
INTERESTS RESIGNATION OF MEMBER
15.1 (a) No Member shall have the right to assign, convey, sell or otherwise
transfer or dispose of, or pledge, mortgage, hypothecate or otherwise encumber
his Interest, whether record or beneficial interest thereof, without the prior
written consent of the Administrative Manager and a majority in Interest of the
Members, which consent may be withheld or delayed in each Member's sole
discretion. Notwithstanding the preceding sentence, but subject to the
restrictions on transferability required by law, or set forth in any instrument
or agreement by which the Company may be bound, or which may be contained in
this Agreement, an individual Member may, with the consent of a majority in
interest of the other Members, assign, convey, sell or otherwise transfer or
dispose of all or any portion of his Interest in the Company to any one or more
of the members of his immediate family or families (defined for the purposes of
this Agreement as a mother, father, sister, brother, son, daughter, stepson,
stepdaughter or spouse (in each instance whether by marriage or otherwise))
and/or to a trust or other entity for the benefit thereof or themselves, by a
written instrument of assignment and assumption, provided that the instrument of
transfer provides for the assumption of the assignor's liabilities and
obligations hereunder and has been duly executed by the assignor of such
Interest and by the transferee. Upon consent of the Administrative Manager, such
assignee shall become a Member and shall thereafter have the rights, powers,
preferences and limitations and be subject to the restrictions and limitations
of a Member under this Agreement. The Member shall notify the Company of any
assignment, transfer or disposition of a beneficial interest in any Interest of
the Member which occurs without a transfer of record ownership, although such
notification, or the absence of a response thereto, shall not be deemed a
consent thereof.
(b) An assignee or transferee of any portion of the Interest of a Member shall
be entitled to receive allocations and distributions attributable to the
Interest acquired by reason of such assignment, from and after the effective
date of the assignment of such Interest to such assignee; however, anything
herein to the contrary notwithstanding, the Company shall be entitled to treat
the assignor of such Interest of the Member as the absolute owner thereof in all
respects, and shall incur no liability for allocations of net profits, net
losses, or gain or loss on sale of Company assets or property, or transmittal of
reports and notices required to be given to Members hereunder which are made in
good faith to such assignor until such time as the written assignment has been
received by the Company, approved and recorded on its books and the effective
date of the assignment has passed. Provided that the Company has actual notice
of any assignment of the Interest of the Member, the effective date of such
assignment on which the assignee shall be deemed an assignee of record shall be
the date set forth on the written instrument of assignment.
(c) Any assignment, sale, exchange, transfer or other disposition in
contravention of any of the provisions of this Article 15 and Article 16 hereof
shall be void and ineffective and shall not bind or be recognized by the
Company.
(d) In the event that there shall be more than one assignee, transferee,
representative or other successor-in-interest as permitted herein (collectively,
the "Transferees") and the Member as of the date of this Agreement shall remain
a Member, then the Member shall be authorized to act, and shall so act, on
behalf of the Member and all of the Transferees acting as such by, through or
under the Member. In the event that there shall be more than one Transferee, and
the Member as of the date of this Agreement shall no longer be a Member, then
the Company must be advised by the Member whose Interest is the subject of such
event or failing which by a two-thirds (2/3) majority in interest of those
holding any portion of the Interests of the Member, of one person to act on
behalf of all of the Transferees. The Member, if the first sentence of this
paragraph shall be applicable, or the person so noted to the Company, if the
second sentence of this paragraph shall be applicable, shall be authorized to
act, and shall so act, for all of the Transferees, all of whom shall be bound by
any decision or action taken by such person, and the Company and all of the
other Members shall be entitled to rely on the decisions or actions taken by
such person. Until the Company shall be advised as to the identity of such
person, (i) the Transferees shall be entitled only to distributions and tax
allocations as provided in Article 8 and 9 hereof, but shall have no right,
power or authority with respect to any decision making reserved herein to the
Members or any of them and (ii) wherever in this Agreement provision shall be
made for the Members to make decisions with respect to. Company matters, the
Interest of the Member, as transferred to the Transferees, shall not be included
in determining whether the requisite Interest of Members have consented to or
approved of such decision.
15.2 Without the prior written consent of all Members, a Member may not resign
from the Company prior to the dissolution and winding up of the Company.
ARTICLE 16
ADMISSION OF SUBSTITUTED MEMBERS;
INCAPACITY FURTHER CONDITIONS
16.1 No assignment or transfer of all or any part of the Interest of a Member
permitted to be made under this Agreement shall be binding upon the Company
unless and until a duplicate original of such assignment or instrument of
transfer, duly executed and acknowledged by the assignor and the transferee, has
been delivered to the Company.
16.2 As a condition to the admission of any Substituted Member, as provided in
Article 16 hereof, the person so to be admitted shall execute and acknowledge
such instruments, in form and substance as the Administrative Manager may deem
necessary or desirable to effectuate such admission and to confirm the agreement
of the person to be admitted as a Member to be bound by all of the covenants,
terms and conditions of this Agreement, as the same may have been amended.
16.3 Any person to be admitted as a Member pursuant to the provisions of this
Agreement shall, as a condition to such admission as a Member, pay all
reasonable expenses in connection with such admission as a Member, including,
but not limited to, the cost of the preparation, filing and publication of any
amendment to this Agreement and/or Articles of Organization.
16.4 (a) In the event of the death or adjudication of incompetency of a Member,
or upon the happening of any event described in Article 14, the executor,
administrator, committee or other legal representative of such Member, or the
successor-in-interest of such Member, shall succeed to the rights of such Member
to receive allocations and distributions hereunder, and at such party's election
may be admitted to the Company as a Member in the place and stead of the
deceased, incompetent, or bankrupt Member (as defined in Article 14), but shall
not be deemed to be a Substituted Member until admitted in accordance with the
procedures of this Article 16.
(b) Upon the death of a Member, the estate of a deceased Member or his heirs or
legatees thereunder, as the case may be, shall have the option to continue in
the Company, or, alternatively, may elect within ninety (90) days of the
deceased Member's death, to offer in writing, within nine (9) months of such
deceased Member's death, to sell the deceased Member's Interest to the Company
at a price equal to the then Fair Market Value thereof, and upon such additional
terms and conditions as may be agreed upon. If the Company does not elect to
purchase the deceased Member's Interest within thirty (30) days of said written
offer, then the remaining Member or Members, as the case may be, shall have the
option, for a period of thirty (30) days thereafter, to purchase the deceased
Member's entire Interest, either in proportion to their respective Interests in
the Company or in such other proportions as they may agree, at a price equal to
the Fair Market Value thereof and upon such additional terms and conditions as
may be agreed upon.
(c) For purposes of this Agreement, "Fair Market Value" shall be the then
aggregate value of the Company's assets including cash or cash equivalents and
Stock as determined by the Current Market Value, computed as of the Trading Day
immediately preceding the valuation date. "Current Market Value" on any date
shall mean the average of the Closing Price for a share of Stock for five (5)
consecutive Trading Days ending on such date. "Closing Price" shall mean, on any
date, with respect to a share of Stock, the last sale price, regular way, or, in
case no such sale takes place on such day, the average of the closing bid and
asked prices, regular way, for one share of Stock in either case as reported in
the principal consolidated transaction reporting system with respect to
securities listed or admitted to trading on its national securities exchange.
"Trading Day" shall mean a day on which the principal national securities
exchange on which the Stock is listed or admitted to trading is open for the
transaction of business or, if the Stock is not listed or admitted to trading on
any national securities exchange, any day other than a Saturday, Sunday or a day
on which banking institutions in the State of New York are authorized or
obligated by law or executive order to close.
16.5 Notwithstanding anything to the contrary contained in this Agreement, no
sale or exchange of an Interest in the Company may be made if the Interest
sought to be sold or exchanged, when added to the total of all other Interests
sold or exchanged within the period of twelve (12) consecutive months prior
thereto, results in the termination of the Company under Section 708 of the Code
without the prior written consent of a majority in Interest of the Members.
16.6 In the event of a permitted transfer of all or part of the Interest of a
Member, the Company shall, if requested, file an election in accordance with
Section 754 of the Code or a similar provision enacted in lieu thereof, to
adjust the basis of the assets of the Company. The Member requesting said
election shall pay all costs and expenses incurred by the Company in connection
therewith.
ARTICLE 17
LIQUIDATION
17.1 Upon the dissolution of the Company, the Company shall be liquidated and
its assets distributed as required by Article VII of the Law.
17.2 The assets of the Company shall be liquidated as promptly as possible, but
in an orderly and businesslike manner so as not to involve undue sacrifice.
17.3 In the event that any proceeds are to be distributed to the Members, same
shall be distributed, if practicable, no later than the later of (i) the end of
the taxable year of the Company in which such liquidation occurs; or (ii) within
ninety (90) days after the date of such liquidating event.
17.4 In any liquidation, the Company's assets shall be used first to pay the
costs and expenses of the dissolution and liquidation. In connection with any
liquidation, the Members may establish any reserves they deem reasonably
necessary for any contingent or unforeseen liabilities or obligations of the
Company or of the Members arising out of or in connection with the Company. Such
reserves shall be paid over by the Members to an attorney-at-law of the State of
New York as escrowee designated by the Members, to be held by him for the
purpose of disbursing such reserves in payment of any of the aforementioned
contingencies. At the expiration of such period as the Members shall deem
advisable, said escrowee shall distribute the balance remaining in the manner
hereinafter provided. No reserves shall be held for longer than two (2) years.
17.5 Any remaining proceeds shall be distributed as follows:
(a) first, to all Members in proportion to and to the extent of any remaining
positive balances in such Member's Capital Account after giving effect to all
allocations to such Member under Article 9 of this Agreement so that liquidation
proceeds shall be distributed in accordance with each Member's positive Capital
Account balance (within the meaning of Treasury Regulation Section 1.704-1(b)
(2) (ii) (~ as in effect on the date hereof); and
(b) second, in accordance with Section 8.1 hereof.
17.6 Each of the Members shall be furnished with a statement prepared by the
Company's then Accountants, which shall set forth the assets and liabilities of
the Company as at the date of completion of liquidation. Upon the Company's
compliance with the provisions of Section 17.4 (including payment over to the
Attorney-Escrowee if there are sufficient funds therefor), the Members shall
cease to be such under this Agreement, and shall execute, acknowledge and cause
to be filed the Articles of Dissolution of the Company.
ARTICLE 18
MISCELLANEOUS
18.1 All terms and words used in this Agreement, regardless of the sense or
gender in which they are used, shall be deemed to include each other sense and
gender unless the context requires otherwise.
18.2 The Members agree immediately and from time to time to execute,
acknowledge, deliver, file, record and publish such further certificates,
amendments to certificates, instruments and documents, and to do all such other
acts and things as may be required by law, or as may, in the opinion of a
majority in Interest of the Members, be necessary or advisable to carry out the
intent and purposes of this Agreement.
18.3 The Members, on behalf of themselves, their legal representatives, heirs,
successors and assigns, hereby specifically renounce, waive and forfeit all
rights whether arising under contract, statute, or by operation of law, to seek,
bring, or maintain any action for partition in any court of law or equity
pertaining to any property which the Company may now or in the future own,
regardless of the manner in which title to any such real property may be held.
18.4 Unless otherwise specified in this Agreement, all notices, demands,
requests or other communications which any of the parties to this Agreement may
desire or be required to give hereunder (hereinafter referred to collectively as
"Notices") shall be in writing and shall be delivered by personal delivery
against receipt or by any nationally recognized overnight courier to the
appropriate Member at the address first set forth above, with a copy of any
Notice being sent simultaneously to Pryor, Cashman, Sherman & Flynn, Attention:
Jonathan A. Bernstein, Esq., 410 Park Avenue, New York, New York 10022. Notice
may also be sent to such other addresses or substitute addresses of which a
Member advises the Company by notice given in the manner set forth herein.
Notices given in compliance with the provisions of this Article shall be deemed
given on the day received or attempted delivery.
18.5 The parties agree that the parties shall be governed by, and this Agreement
construed in accordance with, the laws of the State of New York applicable to
agreements made and to be performed in such State and that all claims and suits
shall be heard in the courts located in the State of New York.
18.6 All section titles or captions contained in this Agreement are for
convenience only and shall not be deemed a part of this Agreement.
18.7 This Agreement may be executed in counterparts and each counterpart so
executed by each Member shall constitute an original, all of which when taken
together shall constitute one agreement, notwithstanding that all the parties
are not signatories to the same counterpart.
18.8 This Agreement may not be changed, modified, amended waived or discharged,
in whole or in part, unless in writing and signed by a majority in Interest of
the Members. This Agreement shall be binding upon the Members and their
respective executors, administrators, legal representatives, heirs, successors
and assigns. The singular of any defined term or term used herein shall be
deemed to include the plural.
18.9 If any term or provision of this Agreement or the application thereof to
any person or circumstance shall to any extent be invalid or unenforceable, the
remainder of this Agreement or the application of such term or provision to
persons or circumstances other than those as to which it is held invalid or
unenforceable shall not be affected thereby and each term and provision of this
Agreement shall be valid and enforced to the fullest extent permitted by law.
18.10 This Agreement is the entire agreement among the parties with respect to
the subject matter hereof and supersedes all prior agreements relative to such
subject matter.
18.11 It is expressly understood that the Investment Manager, the Administrative
Manager and each Member may engage in any other business or investment,
including the ownership of or investment in stocks, options, bonds, funds, and
other investment vehicles, whether or not in direct competition with the
business of the Company and neither the Company nor any other Member shall have
any rights in and to said businesses or investments, or the income or profits
derived therefrom.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.
CHARISMA PARTNERS, L.P., a New York
limited Partnership
By: 8th Floor Realty Corp., its sole general
partner
By:
Name: /S/ Kevin S. Moore
Title: Vice President
---------------------------
/S/Anne L. Peretz
---------------------------
/S/Jesse W. Peretz
---------------------------
/S/Eugenia Peretz
---------------------------
/S/David L. Farnsworth
---------------------------
/S/ Anne Farnsworth
---------------------------
/S/ Edmund S. Twining III
---------------------------
/S/Taylor Twining
---------------------------
/S/ Edmund S. Twining IV
FIRST AMENDMENT TO
OPERATING AGREEMENT
This First Amendment to Operating Agreement -dated August 1, 1995 by
and among the parties who are Members in Federal Holdings L.L.C. prior to the
date hereof (the "Original Members*) and Jonathan A. Bernstein ('JAB').
STATEMENT OF FACTS
By execution of that certain Operating Agreement (the
"Agreementm) for Federal Holdings L.L.C. (the OLLC") dated
June 12, 1995, the Original Members formed the LLC. The
Original Members have agreed to amend the Agreement to provide
for the inclusion of JAB as an Additional Member and to permit
the Administrative Manager (a) to admit such other persons as
he shall deem proper as Additional Members and (b) provide for
and accept Substitute Members as he shall deem proper, all in
his sole and exclusive discretion.
NOW, THEREFORE, the parties hereto hereby agree as
follows:
1. All terms used in this First Amendment and not
defined hereinshall be as defined in the Agreement.
2. JAB is hereby admitted into the LLC as an
Additional Member as of the date hereof, with all of the rights and obligations
of a Member, and fromand after the date hereof, JAB shall be considered
a Member for all purposes under the Agreement, as the same may be modified or
amended from time to time.
3. On the date hereof, JAB is making an Initial Capital
Contribution to the LLC of $100,000. As a result of JAB becoming a Member and
making his Initial Capital Contribution, the Interests of each Member in the LLC
is as set forth on Schedule A annexed hereto and by this reference made a part
hereof.
4. The Administrative Manager shall have the sole and
exclusive right to admit Additional Members and provide for and accept
Substitute Members.
5. Except as modified by this First Amendment, the
Agreement remains unmodified and in full force and effect.
IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment as of the day and year first above written.
CHARISMA PARTNERS, L.P., a New York
limited Partnership
By: 8th Floor Realty Corp.,
its sole general partner By:
Name: /S/ Kevin S. Moore
Title: Vice President
/s/ Attorney in fact
Anne L. Peretz
/s/ Attorney in fact
Jesse W. Peretz
/s/ Attorney in fact
Eugenia Peretz
/s/ Attorney in fact
Anne Farnsworth
/s/ Attorney in fact
Edmund S. Twining III
/s/ Attorney in fact
Taylor Twining
/s/ Attorney in fact
Edmund S. Twining IV
/s/ Attorney in fact
Jonathan A. Bernstein
SCHEDULE A
INITIAL CAPITAL
CONTRIBUTION
CHARISMA PARTNERS, LP $600,000.00
ANNE PERETZ $100,000.00
JESSE W. PERETZ $50,000.00
EUGENIA PERETZ $50,000.00
DAVID L. FARNSWORTH $50,000.00
ANNE FARNSWORTH $50,000.00
EDMUND TWINING III $50,000.00
TAYLOR TWINING $25,000.00
EDMUND S. TWINING IV $25,000.00
JONATHAN A. BERNSTEIN $100,000.00
SECOND AMENDMENT TO
OPERATING AGREEMENT
THIS Second Amendment to Operating Agreement dated as of July 1, 1998 by
and among the parties who are Members in Federal Holdings L.L.C.
STATEMENT OF FACTS
This Second Amendment to Operating Agreement dated as of July 1, 1998 by
and among the parties who are Members in Federal Holdings L.L.C.
By execution of that certain Operating Agreement (the "Original Agreement") for
Federal Holdings L.L.C. (the "LLC") dated June 12, 1995, the LLC was formed. The
Original Agreement was amended by a First Amendment to Operating Agreement dated
August 1, 1995 To admit an additional member. The original Agreement, As
modified by the First Amendment To Operating Agreement, is hereinafter referred
to as the "Agreement". The Members have agreed to amend the Agreement on the
Terms and conditions set forth below.
NOW, THEREFORE the parties hereto herby agree as follows:
1. All terms used in this Amendment and not defined herein shall be as
defined in the Agreement.
2. The definition of "Preferred Return" in Section 1.1 of the Original
Agreement is deleted in its entirety and the following is substituted
in its place and stead:
"Preferred Return": with respect to a Member, an amount equal to the Bank Index
Percentage on a per annum interest basis (prorated for any partial year) on the
amount of such Member's Unrecovered Capital Contribution, from time to time,
calculated from the date a Capital Contribution is made.
3. The following definitions are hereby inserted into section 1.1;
"Bank Index Percentage": A percentage determined by subtracting 2,123 from the
Current Index Value, and dividing the resulting number 2,123.
"Current Index Value": the value of the NASDAQ Bank Index as reported by NASDAQ
at the close of trading on any trading day, as provided in rule 2871(e) in the
NASDQ Manual and published in The Wall Street Journal under the NASDAQ Market
Indices. If The Wall Street Journal shall no longer publish such value, then the
Administrative Manger shall select another publication whether in print or
electronic form. As of the close of business on June 30, 1998, the Current Index
Value was 2,123.
"NASDAQ Bank Index": The index commonly known as the NASDAQ Bank Index as
reported by NASDAQ. In the event that the NASDAQ Bank Index is no longer
reported by NASDAQ, the administrative Manager shall select another index in
substitution thereof.
4. Modifying section 3.1 of the Original Agreement, the Company's
registered office in New York shall be at One Rockefeller Plaza, 31st
Floor, New York, New York 10120.
5. The reference to "20%" in the defined term of "Unrecovered 20% IM Fee",
and in the definition thereof, shall be and hereby is changed to "25%."
6. Section 8.1 (b)(iv) is hereby deleted in its entirety and the following
is substituted in its place and stead: "the balance,if any, shall be
paid 75% of the Members in proportion to their Interest and 25% to
the Investment Manager."
7. The Management Term shall mean a term of (2) years commencing as of the
date hereof and continuing through and including June 30, 2000.
8. Modifying Sections 10.4, the "Account" is currently at Bear Stearns &
Co., Inc.
9. Except as modified by this Second Amendment, the Agreement remains
unmodified and in full force and effect.
IN WITHNESS WHEREOF, the parties hereto have executed this Second
Amendment as of the day and year first above written.
CHARISMA PARTNERS, L.P., a New York
limited Partnership
By: 8th Floor Realty Corp.,
its sole general partner By:
Name: /S/ Kevin S. Moore
Title: Vice President
/s/ Attorney in fact
Anne L. Peretz
/s/ Attorney in fact
Jesse W. Peretz
/s/ Attorney in fact
Eugenia Peretz
/s/ Attorney in fact
Anne Farnsworth
/s/ Attorney in fact
Edmund S. Twining III
/s/ Attorney in fact
Taylor Twining
/s/ Attorney in fact
Edmund S. Twining IV
/s/ Attorney in fact
Jonathan A. Bernstein
The undersigned, as Investment Manager, is executing this Second Amendment
to evidence its acknowledgment and agreement to the terms and conditions set
forth above.
Lawrence Seidman
EX-10.8
10
pollackkk.txt
POLLACK INVESTMENT PARTNERSHIP, L.P. AGREEMENT
CONFIDENTIAL - NOT TO BE REPRODUCED OR CIRCULATED
POLLACK INVESTMENT PARTNERSHIP, L.P.
A NEW JERSEY LIMITED PARTNERSHIP
PRIVATE PLACEMENT MEMORANDUM
LIMITED PARTNERSHIP INTEREST
JUNE 2000
THIS PRIVATE PLACEMENT MEMORANDUM HAS BEEN SUBMITTED TO YOU CONFIDENTIALLY IN
CONNECTION WITH THE PRIVATE PLACEMENT OF LIMITED PARTNERSHIP INTERESTS AND DOES
NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY THE
INTERESTS IN ANY STATE OR JURISDICTION IN WHICH THE OFFER OR SALE OF THE
INTERESTS WOULD BE PROHIBITED OR TO ANY ENTITY OR INDIVIDUAL NOT POSSESSING THE
QUALIFICATIONS DESCRIBED IN THIS MEMORANDUM.
For the information of:
_________________Number _________
PRIVATE OFFERING TO QUALIFIED INVESTORS
AND A LIMITED NUMBER OF NON-QUALIFIED INVESTORS
THE LIMITED PARTNERSHIP INTERESTS REFERRED TO IN THIS PRIVATE PLACEMENT
MEMORANDUM HAVE NOT BEEN REGISTERED UNDER EITHER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "1933 ACT"), OR THE SECURITIES LAWS OF CERTAIN STATES AND ARE BEING
OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF
THE 1933 ACT AND THOSE LAWS. THE INTERESTS ARE SUBJECT TO RESTRICTIONS ON
TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS
PERMITTED UNDER THE 1933 ACT AND THE SECURITIES LAWS OF CERTAIN STATES PURSUANT
TO REGISTRATION OR EXEMPTION FROM REGISTRATION. THE INTERESTS HAVE NOT BEEN
APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION, ANY STATE
SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY, NOR HAS ANY OF THOSE
AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING OR THE ACCURACY
OR ADEQUACY OF THIS MEMORANDUM. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
IN NO EVENT SHOULD THIS PRIVATE PLACEMENT MEMORANDUM BE DUPLICATED OR
TRANSMITTED TO ANYONE OTHER THAN THE PROSPECTIVE INVESTOR TO WHOM IT WAS
DIRECTED BY WRITTEN COMMUNICATION OF THE OFFEROR.
CALIFORNIA
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE CALIFORNIA CORPORATION CODE BY REASON OF SPECIFIC EXEMPTIONS
THEREUNDER RELATING TO THE LIMITED AVAILABILITY OF THE OFFERING. THESE
SECURITIES CANNOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF TO ANY PERSON OR
ENTITY UNLESS SUBSEQUENTLY REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE CALIFORNIA CORPORATIONS CODE, IF SUCH REGISTRATION IS REQUIRED.
CONNECTICUT
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE BANKING
COMMISSIONER OF THE STATE OF CONNECTICUT NOR HAS THE COMMISSIONER PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS OFFERING. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
FLORIDA
PURSUANT TO SECTION 517.061(11) OF THE FLORIDA SECURITIES AND INVESTOR
PROTECTION ACT, AN OFFEREE WHO IS A RESIDENT OF FLORIDA MAY, AT THE OFFEREE'S
OPTION, VOID ANY PURCHASE HEREUNDER WITHIN A PERIOD OF THREE (3) DAYS AFTER HE
(A) FIRST TENDERS OR PAYS THE CONSIDERATION TO THE PARTNERSHIP REQUIRED
HEREUNDER OR (B) DELIVERS HIS EXECUTED SUBSCRIPTION AGREEMENT WHICHEVER OCCURS
LATER, TO ACCOMPLISH THIS, IT IS SUFFICIENT FOR A FLORIDA OFFEREE TO SEND A
LETTER OR TELEGRAM TO THE PARTNERSHIP WITHIN THE THREE (3) DAY PERIOD, STATING
THAT HE IS VOIDING AND RESCINDING THE PURCHASE. IF AN OFFEREE SENDS A LETTER, IT
IS PRUDENT TO DO SO BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO ENSURE THAT
IT IS RECEIVED AND TO EVIDENCE THE TIME OF MAILING.
ILLINOIS
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECRETARY OF STATE
OF ILLINOIS OR THE STATE OF ILLINOIS, NOR HAS THE SECRETARY OF STATE OF ILLINOIS
OR THE STATE OF ILLINOIS PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
IOWA
IN MAKING AN INVESTMENT DECISION INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF
THE PERSON OR ENTITY CREATING THE SECURITIES AND THE TERMS OF THE OFFERING,
INCLUDING THE MERITS AND RISKS INVOLVED. THESE SECURITIES HAVE NOT BEEN
RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY
AUTHORITY. FURTHERMORE, THE FOREGOING AUTHORITIES HAVE NOT CONFIRMED THE
ACCURACY OR DETERMINED THE ADEQUACY OF THIS DOCUMENT. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND
MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO
REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY WILL BE
REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD
OF TIME.
NORTH CAROLINA
IN MAKING AN INVESTMENT DECISION INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF
THE PERSON OR ENTITY CREATING THE SECURITIES AND THE TERMS OF THE OFFERING,
INCLUDING THE MERITS AND RISKS INVOLVED. THESE SECURITIES HAVE NOT BEEN
RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY
AUTHORITY. FURTHERMORE, THE FOREGOING AUTHORITIES HAVE NOT CONFIRMED THE
ACCURACY OR DETERMINED THE ADEQUACY OF THIS DOCUMENT. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND
MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO
REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY WILL BE
REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD
OF TIME.
PENNSYLVANIA
EACH SUBSCRIBER WHO IS A PENNSYLVANIA RESIDENT HAS THE RIGHT TO WITHDRAW HIS
ACCEPTANCE WITHOUT INCURRING ANY LIABILITY TO THE PARTNERSHIP OR ANY OTHER
PERSON WITHIN TWO BUSINESS DAYS FROM THE DATE OF RECEIPT BY THE PARTNERSHIP OF
HIS DULY EXECUTED SUBSCRIPTION AGREEMENT OR THE INITIAL PAYMENT FOR THE PURCHASE
OF HIS LIMITED PARTNERSHIP INTEREST, WHICHEVER IS LATER. ANY NOTICE OF
WITHDRAWAL SHOULD BE MADE BY TELEGRAM OR CERTIFIED OR REGISTERED MAIL AND WILL
BE EFFECTIVE UPON DELIVERY TO WESTERN UNION OR DEPOSIT IN THE UNITED STATES
MAILS, TRANSMITTAL OR POSTAGE FEES PAID. UPON SUCH WITHDRAWAL, THE SUBSCRIBER
WILL HAVE NO OBLIGATION OR DUTY UNDER THE SUBSCRIBER AGREEMENT TO THE
PARTNERSHIP, THE GENERAL PARTNERS, OR ANY OTHER PERSON, AND WILL BE ENTITLED TO
THE FULL RETURN OF ANY AMOUNT PAID BY HIM, WITHOUT INTEREST.
NEITHER THE PENNSYLVANIA SECURITIES COMMISSION NOR ANY OTHER AGENCY HAS PASSED
ON OR ENDORSED THE MERITS OF THIS OFFERING AND ANY REPRESENTATION TO THE
CONTRARY IS UNLAWFUL.
PENNSYLVANIA SUBSCRIBERS MAY NOT SELL THEIR PARTNERSHIP INTEREST FROM THE DATE
OF PURCHASE IF SUCH A SALE WOULD VIOLATE SECTION 203(d) OF THE PENNSYLVANIA
SECURITIES ACT.
TEXAS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER APPLICABLE LAWS OF TEXAS
AND THEREFORE CANNOT BE RESOLD OR TRANSFERRED UNLESS SUBSEQUENTLY REGISTERED
UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE.
TABLE OF CONTENTS
Introduction.................................................................8
Summary Description of thePartnership and the Offering.......................8
Investment Objective................................................8
Investment Approach and Policies....................................8
Special Techniques..................................................9
Scheduled Term of Partnership.......................................9
Minimum Initial Investment by Limited Partners......................9
Expenses 9
Administrative Fee..................................................9
Allocation of Profit or Loss........................................9
Additional Contributions...........................................10
Admission of Limited Partners......................................10
Withdrawals by Limited Partners....................................10
Eligibility Standards for Investors................................10
Compensation to Third Parties......................................11
Evaluating The Partnership..................................................11
Investment Techniques..............................................11
Special Techniques.................................................12
Short-Term Trading........................................12
Leverage. ...............................................13
Option Strategies.........................................13
Derivatives. ............................................13
Publicly Distributed Securities....................................13
Portfolio Transactions and Brokerage...............................14
Use of Cash and Cash Equivalents...................................15
Management..................................................................16
The General Partners...............................................16
Lawrence Seidman...................................................16
Prior Investment Experience of Seidman Entities...........17
Dennis Pollack.....................................................18
Certain Risks...............................................................18
Dependence on the General Partners.................................18
Risks of Special Techniques and Short Sales........................18
Short-Term Trading........................................18
Leverage. ...............................................18
Short Sales...............................................19
Options. 19
Small Cap Stocks...................................................19
Derivative Instruments.............................................19
High Risk Investments..............................................19
Extraordinary Expenses.............................................20
Lack of Liquidity of Partnership Assets............................20
Illiquidity........................................................20
Changes in Applicable Law..........................................20
Conflicts of Interest.......................................................21
Service of the General Partners....................................21
Allocation of Investment Opportunities.............................21
Co-Investment by the General Partners..............................21
General Partners' Share of Profits.................................21
Resolution of Conflicts............................................22
Tax Consequences............................................................22
Federal Income Tax Considerations in General.......................22
Federal Income Tax Rules Applicableto Options and Hedging
Transactions.......................................................23
Options in General........................................23
Section 1256 Contracts....................................24
Straddles. ..............................................24
Allocation of Taxable Income.......................................25
State and Local Tax Consequences...................................25
Tax Information....................................................25
ERISA Considerations...............................................25
Unrelated Business Taxable Income ("UBTI").........................27
The Partnership Agreement...................................................27
Control............................................................27
Liability of the General Partner...................................27
Liability of the Limited Partners..................................27
Additional Contributions; New Limited Partners.....................28
Form of Contributions..............................................28
Allocations........................................................28
Expenses 28
Withdrawals by Limited Partners....................................30
Withdrawals by the General Partner and Limited Partners that are
Affiliates of General Partner......................................31
Term of Partnership................................................31
Dissolution........................................................31
Reports 31
Amendments.........................................................32
Indemnification....................................................32
Rights of Transfer.................................................32
Investing in The Partnership................................................33
Minimum Subscription...............................................33
Investor Suitability Standards.....................................33
Access to Information..............................................35
Method of Subscription.............................................35
Miscellaneous Securities Matters............................................36
Registration Under the Investment Act..............................36
Exemption from the Investment Company Act .........................36
Additional Information......................................................36
Professional Assistance.....................................................36
Exhibit A...................................................................37
Exhibit B...................................................................56
Exhibit C...................................................................62
INTRODUCTION
Pollack Investment Partnership, L.P. (The "Partnership"), formed in June 2000,
is a New Jersey limited partnership which will seek to maximize capital
appreciation in the securities markets through analysis of individual
securities, not markets. Securities will be selected on the basis of perceived
pricing inefficiencies in stocks based on their comparison to other stocks in
the same industry segment, growth rate in either earnings or assets and cash
flow. The partnership will primarily focus upon the purchase of shares of
publicly traded thrifts and banks, but may expand this investment approach
depending upon market factors. The General Partners believe the majority of
these opportunities occur in companies not well followed by Wall Street
research. Market risk may be hedged through the use of short sales and various
option strategies.
SUMMARY DESCRIPTION OF THE
PARTNERSHIP AND THE OFFERING
The Partnership offers limited partnership interests (an "Interest" or the
"Interests", as appropriate), privately, to no more than 35 "non accredited"
investors and to "accredited" investors who, upon admission to the Partnership,
become its limited partners (a "Limited Partner" or the "Limited Partners", as
appropriate). The following is a summary description of the Partnership and
certain of the major terms of the offering and is qualified in its entirety by
information appearing elsewhere in this Private Placement Memorandum and in the
Partnership's Agreement of Limited Partnership (the "Partnership Agreement"),
which is annexed hereto.
MANAGEMENT
Dennis Pollack ("Pollack") and Lawrence B. Seidman
("Seidman") shall serve as the General Partners and have
complete and exclusive control of the management of the
Partnership. Pollack has over 12 years experience in the
banking business. Seidman has over 16 years experience in
the investment business. The General Partners will be
permitted to share fees and other financial benefits with
third parties.
INVESTMENT OBJECTIVE
The Partnership's investment objective is to maximize
capital appreciation by long and short-term investments in,
and the short sale of, securities. See "EVALUATING THE
PARTNERSHIP".
INVESTMENT APPROACH
AND POLICIES
The Partnership will seek to meet its objectives through
investment in what are deemed to be inefficiently priced
stocks based on estimates of future growth rate in earnings
or assets and cash flow. The Partnership will primarily
focus upon the purchase of shares of publicly traded thrifts
and banks, but may expand this investment approach depending
upon market factors. The Partnership may affect short sales
of securities, which the General Partners consider to be
overpriced, or subject to adverse business conditions not
currently reflected in their price.
SPECIAL TECHNIQUES
The Partnership May attempt to enhance its performance by
engaging in short-term trading and by using leverage and
certain hedging techniques. See "EVALUATING THE
PARTNERSHIP-Special Techniques".
SCHEDULED TERM OF
PARTNERSHIP
20 years. See "THE PARTNERSHIP AGREEMENT-Term of
Partnership".
MINIMUM INITIAL
INVESTMENT BY
LIMITED PARTNERS
$100,000, subject to waiver by the General Partners under
appropriate circumstances. See "INVESTING IN THE
PARTNERSHIP-General Information".
EXPENSES Organizational, administrative, legal, proxy, audit
and investment expenses will be paid by the Partnership. See
"THE PARTNERSHIP AGREEMENT-Expenses".
ADMINISTRATIVE FEE
The Partnership will pay the General Partners, as of the end
of each fiscal quarter of the Partnership, an administrative
fee at an annual rate equal to 1% of the value of the
Partnership's assets. See "THE PARTNERSHIP
AGREEMENT-Expenses".
ALLOCATION OF PROFIT OR LOSS
Net Profit for each year (as defined below) will be
allocated to the Partners, on the basis of the proportion
that each Partner's capital accounts bear to the capital
accounts of all the Partners. At the end of the fiscal year,
20% of the Net Profit allocated to the accounts of the
Limited Partners will be re-allocated to the General
Partners (the "Incentive Allocation"). The General Partners
may reallocate to special Limited Partners and other third
parties all or a portion of the Incentive Allocation. Net
loss for each fiscal year (as defined below) generally will
be allocated to each Partner in proportion to and in
accordance with the capital account of the Partner. To the
extent losses have been allocated to the account of a
Partner, 100% of Net Profits attributable to such Partner
will be allocated to the account of that Partner until all
such losses have been recouped. Only after such losses have
been recouped will the General Partners be entitled to the
20% Incentive Allocation on subsequent profits. See"THE
PARTNERSHIP AGREEMENT-Allocations". ADDITIONAL CONTRIBUTIONS
At the discretion of the General Partners, additional
contributions to the Partnership may be made by a Partner.
See "THE PARTNERSHIP AGREEMENT-Additional Contributions; New
Limited Partners".
ADMISSION OF LIMITED
PARTNERS
New Limited Partners May be admitted to the Partnership at
the discretion of the General Partners. See "THE PARTNERSHIP
AGREEMENT-Additional Contributions; New Limited Partners".
WITHDRAWALS BY
LIMITED PARTNERS
Withdrawals by Limited Partners of all or a portion of a
Capital Account are permitted annually as of the last day of
the Fiscal Year on 90 days written notice to the General
Partners provided the Limited Partner has been a Partner of
the Partnership for eight full fiscal quarters, unless
otherwise permitted at the discretion of the General
Partners. The withdrawing Limited Partner shall pay for any
costs incurred by the Partnership to effectuate the
withdrawal. At the discretion of the General Partners,
distributions upon withdrawal may be in cash or in kind or
both. See "THE PARTNERSHIP AGREEMENT-Withdrawals by Limited
Partners".
ELIGIBILITY STANDARDS
FOR INVESTORS
Interests described in this Private Placement Memorandum are
not registered under the Securities Act of 1933, as amended
(the "1933 Act"), in reliance upon the exemption contained
in Section 4(2) of the 1933 Act and Regulation D thereunder
for transactions not involving a public offering. An offer
and sale of Interests is made only to a prospective investor
who satisfies, in the judgment of the General Partners,
certain suitability standards. See "INVESTING IN THE
PARTNERSHIP-Investor Suitability Standards".
COMPENSATION TO
THIRD PARTIES
Interests in the Partnership may be offered with the
assistance of registered broker dealers and others who are
not affiliated with the Partnership. Subject to applicable
state securities laws, such persons may receive compensation
for their services based on the percentage of the amount
invested as a result of their services. The identity and
amount of compensation to be paid will be disclosed to the
prospective Limited Partner prior to the acceptance of his
Subscription Agreement by the Partnership.
EVALUATING THE PARTNERSHIP
The Partnership is a New Jersey limited partnership formed in June 2000
which will seek to maximize capital appreciation in the securities markets
through the purchase and short sale of securities, while hedging its risks
through the use of various techniques such as short selling, and purchase and
sale of stock and index options, convertible securities and fixed income
securities. While the primary goal of the Partnership is long term capital gain
through the purchase of publicly traded thrift and bank stocks, it will not
overlook opportunities to identify short term aberrations in the pricing of
certain securities and to take advantage of the resulting price movement. Such
opportunities may arise when, for example, stock of a historically successful
company suffers a large percentage loss as a result of a non-recurring event
such as a sudden catastrophic loss or an unanticipated dividend cut. The
Partnership may also take advantage of opportunities in time arbitrage when it
believes the risk reward ratio is strongly in its favor. Time arbitrage is the
purchase of securities of companies involved in takeovers, restructuring, stock
buy-backs, etc. The Partnership may buy the stock of such companies if it
believes the "spread" between the market price and eventual price on the
completion of the transaction is great enough on a percentage basis to merit
investment.
While the Partnership will invest primarily in publicly traded common
stocks, investments may, from time to time, include stock warrants, rights,
preferred stocks, securities purchased in private placements or other restricted
securities, bonds and other debt instruments, convertible securities, put and
call options, swaps, forward contracts and other financial instruments and short
sales of the foregoing.
Investment Techniques
The Partnership will attempt to maximize capital gains through analysis of
individual securities, not markets. The General Partners believe that over
extended periods of time stock selection, not market timing, is the key
ingredient of investment success. Therefore, the Partnership will concentrate
its efforts in a "bottoms-up" stock selection process as opposed to a "top-down"
macro-economic approach. Securities will be selected primarily on the basis of
what the General Partners deem to be inefficiencies in the pricing of the stock
at any given time. These inefficiencies can occur when the market is overlooking
the potential of a company's assets, cash flow, brand names or market niche, and
securities with these characteristics are often referred to as "value" stocks.
Underevaluation can also occur when a company's current or future growth in
earnings is not attracting a price/earning ratio in line with that growth or its
assets are not being properly allocated to maximize the return on said assets.
Generally, the Partnership will avoid investing in companies, which are
widely followed by Wall Street analysts, as the opportunities for pricing
inefficiencies in those companies are rare. The Partnership may take
concentrated positions in those companies where it believes extraordinary
capital gain potential exists. When the Partnership acquires more than 5% of a
company's stock, it will be required to file a Form 13D disclosing its position
and other data. The Partnership may attempt to acquire control of companies,
which attempts may entail the Partnership's involvement in a proxy contest or
other take-over litigation. Other partnerships in which Mr. Seidman was a
general partner have been involved in seven proxy contests involving five
separate companies in the past. If the General Partners are elected to serve on
the Board of Directors of a company in which the Partnership has taken a
position or serve as an officer of such company, the compensation for such
service will not be shared with the Partnership.
To hedge its position and with a view to enhancing its performance, the
Partnership may sell securities short. If the Partnership believes a company has
poor business prospects or its stock price has been inflated by overly
optimistic Wall Street assessments, it may sell short expecting the stock price
to decline substantially. Selling securities short involves selling securities
that the Partnership does not own. To make delivery to the purchaser of the
securities, the Partnership borrows securities from a third party lender. The
Partnership typically fulfills its obligation to the lender by purchasing
securities in the market. The Partnership generally is required to pledge cash
with the lender equal to the market price of the borrowed securities. This
deposit may be increased or decreased in accordance with changes in the market
price of the borrowed securities. During the period in which the securities are
borrowed, the lender typically retains its right to receive interest and
dividends accruing to the securities, but pays the Partnership a fee for the use
of the Partnership's cash. This fee is based on prevailing interest rates, the
availability of the particular security for borrowing, and other market factors.
Special Techniques
The Partnership may attempt to enhance its performance by engaging in
short-term trading and by using leverage and attempt to hedge its portfolio by
the use of options, warrants, convertible securities, and similar strategies.
These special investment techniques are described below.
Short-Term Trading.The Partnership will typically seek to invest and hold
for the long term a "core" of equity securities. The extent of this core of
equity positions will depend on market conditions, but typically will represent
more than 50% of the Partnership's assets at any one time. From time to time,
the Partnership may make frequent changes in that part of its portfolio that
does not fall within the Partnership's core positions to take advantage of
opportunities in the market.
Leverage. The Partnership expects to borrow funds for the purpose of
purchasing securities. Loans to the Partnership will be arranged through
broker-dealers with which the Partnership maintains customer accounts. The
amount of borrowings that the Partnership may have outstanding at any time may
be large in comparison to its capital.
Option Strategies. The Partnership may purchase and sell put and call
options on both securities and stock indexes for the purpose of hedging its
portfolio positions. A stock index measures the movement of a certain group of
stocks by assigning relative values to the common stocks included in the index.
Examples of well-known stock indexes on which the Partnership may purchase put
and call options are the Standard & Poor's composite Index of 500 Stocks, the
Standard & Poor's 100 Index, the American Stock Exchange Major Market Index and
the New York Stock Exchange Composite Index.
Derivatives. The Partnership may use derivative securities to augment
returns or reduce risk. Derivatives are securities products developed by banks
and brokerage firms that are not traded on securities exchanges or in
over-the-counter markets, but which mirror individual securities or "baskets" of
securities.
The Partnership does not presently intend to have derivatives represent a
significant amount of its equity but, rather, may use them in the same manner as
conventional option strategies.
Publicly Distributed Securities
From time to time, the Partnership may purchase securities, which are part
of a public distribution. If such securities trade at a premium in the secondary
market immediately after the distribution process has commenced, the National
Association of Securities Dealers, Inc. ("NASD") has taken the position in its
Rules of Fair Practice that such securities are part of a "hot issue" and,
accordingly members of the NASD may not sell such securities to an account in
which a member, or a person having specified relationships with a member, of the
NASD has an interest. In addition, in the case of senior bank officers and
certain other persons, participation is permitted in hot issues only in certain
circumstances.
In view of this restriction, the Partnership Agreement provides a mechanism
for the purchase of securities in a public distribution without presenting
problems to any Limited Partner who would or might be deemed to come within the
NASD prohibition or to the Partnership.
In essence, the mechanism provided for in the Partnership Agreement for
"hot issues" is for the Partnership to have, in addition to its regular
accounts, a special account (the "Hot Issues Account"), the sole purpose of
which is to purchase securities which are part of a public distribution and are
considered a "hot issue". Only those Limited Partners who do not fall within the
prohibition of the NASD will have a beneficial interest in the Hot Issues
Account (as compared to the Partnership's regular accounts in which all Partners
have an interest).
A General Partner may not have a beneficial interest in the Hot Issues
Account if he is affiliated with a member of the NASD, and accordingly, will not
receive any of the net profits attributable to such investments. Portfolio
Transactions and BrokeragePortfolio Transactions and BrokeragePortfolio
Transactions and Brokerage
The General Partners are responsible for arranging for the execution of the
Partnership's portfolio transactions and the allocation of brokerage.
Transactions on United States stock exchanges and on some foreign stock
exchanges involve the payment of negotiated brokerage commissions. On the great
majority of foreign stock exchanges, commissions are fixed. No stated commission
is generally applicable to securities traded in the over-the-counter markets,
but the prices of those securities may include undisclosed commissions or
markups.
In arranging for execution of transactions on behalf of the Partnership,
the General Partners seek to obtain the best price and execution for the
Partnership, taking into account many factors including price, size of order,
difficulty of execution, operational facilities of a brokerage firm,
availability of particular securities from the executing broker-dealer, and the
firm's risk in positioning a block of securities. Although the General Partners
generally seek reasonably competitive commission rates, the Partnership may not
necessarily pay the lowest commission available. The Partnership has no
obligation to deal with any broker or group of brokers in executing transactions
in portfolio securities.
The General Partners may place brokerage business on behalf of the
Partnership with brokers that provide supplemental research, market and
statistical information to the General Partners. The phase "research, market and
statistical information" includes advice as to the value of securities, the
availability of investing in, purchasing or selling securities, and the
availability of securities or purchasers or sellers of securities, and
furnishing analyses and reports concerning issuers, industries, securities,
economic factors and trends, portfolio strategy and the performance of accounts.
The expenses of the Partnership are not necessarily reduced as a result of the
receipt of this supplemental information, which may also be useful to other
entities controlled by a General Partner in providing services to his clients.
In addition, not all of the supplemental information may be used by the General
Partners in connection with the Partnership.
The Partnership will not consider turnover rate a limiting factor in making
investment decisions consistent with its investment objective and policies.
Use of Cash and Cash Equivalents
Pending investment of the proceeds of this offering in accordance with the
Partnership's investment objective and policies, or when the General Partners
believe the Partnership should follow a temporary defensive posture, or when the
General Partners determine that opportunities for capital growth are
unattractive, the Partnership may, without limitation, hold cash or invest in
cash equivalents. Among the cash equivalents in which the Partnership may invest
are: obligations of the United States Government, its agencies or
instrumentalities ("U.S. government securities"); commercial paper; and
certificates of deposit and bankers' acceptances issued by domestic branches of
United States banks that are members of the Federal Deposit Insurance
Corporation. The Partnership may also engage in repurchase agreements, may
purchase shares of money market mutual funds and may receive interest paid on
its credit balances.
MANAGEMENT
The General Partners
Lawrence Seidman ("Seidman") is a Co-General Partner of the Partnership. Seidman
is an attorney admitted to practice law in the States of New Jersey and New York
and the District of Columbia. For the past sixteen years he has been involved as
a general partner and/or counsel, in the organization of real estate and stock
investment limited partnerships. Mr. Seidman, since approximately March 1999,
has been a director of CNY Financial Corporation and its wholly owned
subsidiary, Cortland Savings Bank; since August 1999, has been a director of
South Jersey Financial Corporation and its wholly owned subsidiary, South Jersey
Savings and Loan Association; and since March 2000 has been a director of Ambanc
Holding Co., Inc. Since March 1999, Mr. Seidman has been the President, General
Counsel and a director of Menlo Acquisition Corporation. Mr. Seidman is also
Manager of Seidman & Associates, L.L.C., President of Veteri Place Corp., the
sole General Partner of Seidman Investment Partnership, LP, Seidman Investment
II LP, Manager of Federal Holdings, L.L.C. and business consultant to certain
partnerships and individuals, including, but not limited to, Kerrimatt, LP. He
has been a director of the Savings Bank of Rockland County and a director and
Chairman of the Board of Crestmont Financial Corp., the holding company for
Crestmont Federal Savings & Loan Association. He has also been an officer and
director of Seidman & Rappaport, P.A., a law firm he organized and prior thereto
was an associate at two separate law firms.
On November 8, 1995, the acting Director of the Office of Thrift
Supervision (OTS) issued a Cease and Desist Order against Seidman ("C&D") after
finding that Seidman recklessly engaged in unsafe and unsound practices in the
business of an insured institution. The C&D actions complained of were due to
Seidman having allegedly obstructed an OTS investigation. The C&D ordered him to
cease and desist from (i) any attempts to hinder the OTS in the discharge of its
regulatory responsibilities, including the conduct of any OTS examination or
investigation; and (ii) any attempt to induce any person to withhold material
information from the OTS related to the performance of its regulatory
responsibilities. The C&D also provided that, for a period of no less than three
(3) years, if Seidman became an institution-affiliated party of any insured
depository institution subject to the jurisdiction of the OTS, to the extent
that his responsibilities included the preparation or review of any reports,
documents, or other information to be submitted to or reviewed by the OTS in the
discharge of its regulatory functions, all such reports, documents, and other
information, prior to submission to, or review by the OTS, were to be
independently reviewed by the Board of Directors or a duly appointed committee
of the Board to ensure that all material information and facts had been fully
and adequately disclosed. In addition, a civil money penalty in the amount of
$20,812 was assessed under the C&D. A copy of the entire opinion of the United
States Court of Appeals for the Third Circuit, which reversed the OTS Director's
first Decision and Order in connection with this matter, and copies of the
decisions of the OTS Administrative Law Judge and OTS Director are available
upon request.
Prior Investment Experience of Seidman
In the past, Mr. Seidman has principally invested in bank and thrift stocks
through two limited liability companies and three limited partnerships. The
following table recites the date of inception for each such entity and its
performance through September 30, 1999:
Annualized %
Return on Period
Inception Capital from to
Entity Date Inception(1) 9/30/99
------ ---- ------------ -------
Seidman & Associates, LLC (2) 12/94 22.80 58 Mos.
Federal Holdings, LLC 7/98 34.70 15 Mos.
Seidman Investment Partnership, LP 1/95 27.80 57 Mos.
Seidman Investment Partnership II, LP 8/98 28.00 13 Mos.
Kerrimatt, LP 10/98 50.40 11 Mos.
(1) Return based upon initial investment of $1 at inception without
consideration for additional capital contribution.
(2) This entity and Seidman & Associates II, LLC were merged together
in or about April 1, 1999. The return set forth is for the merged
entity.
Mr. Seidman has filed a Schedule 13D in connection with ten companies. As
of September 30, 1999, five of those companies had been sold. Each company was
sold for cash and/or stock or a combination of both, at a price that provided
Mr. Seidman's entities a significant profit on their purchased shares. As of
September 30, 1999, five companies had not been sold, but their share price has
significantly increased over the average price paid for said shares.
Prior to June 1, 2000, once Mr. Seidman filed a Schedule 13D, he did not
sell his share position with respect to any of said companies until a sale of
the company was publicly announced. Most of the banks and thrifts in which Mr.
Seidman invests are very thinly traded and therefore a sale of a substantial
block could be very difficult. Furthermore, with respect to the companies for
which Schedule 13D's have been filed, Mr. Seidman has not recognized a loss.
Mr. Seidman does purchase less than 4.9% of companies for which no Schedule
13D is required. Mr. Seidman has sold some of these positions at a loss.
Mr. Seidman's past performance is no guarantee of future success or
profitability. Furthermore, Mr. Seidman, in the future, could suffer a loss on
the sale of a stock in a company in which he has a Schedule 130 filed or could
sell the stock before a sale of the company is announced.
Dennis Pollack. ("Pollack") is a Co-General Partner of the Partnership. Since
December 1, 1996, Pollack has been the Managing Director of Pegasus Funding
Group based in Newton Square, Pennsylvania, an asset based lender. From April
1996 to December 1998 he was President, Chief Executive Officer and a member of
the Board of Directors of the Connecticut Bank of Commerce. Since October 1998,
Pollack has been a consultant to Valley National Bank of Wayne, New Jersey and,
since December 1998, has been a consultant to the Connecticut Bank of Commerce.
From January 1995 to March 1996, he was Regional Vice President and National
Director of Bank Consulting of Axiom Management Consulting, a
management-consulting firm that provides specialized business processing
reengineering services. From April 1995 to December 1995, he was Regional
President of First Fidelity Bank, New York. From March 1988 to April 1995, Mr.
Pollack was the President, Chief Executive Officer and a member of the Board of
Directors of the Savings Bank of Rockland County. First Fidelity Bank purchased
the Savings Bank of Rockland County. Mr. Pollack is the Chairman of the
Salvation Army Board-Rockland County, New York and was previously on the
Executive Committee for Good Samaritan Hospital and the Citizens Advisory
Committee for the Helen Hayes Hospital.
CERTAIN RISKS
Purchasing Interests involves certain risks to an investor. Careful
attention should be given to the significant risks discussed in the following
summary.
Dependence on the General Partners
Either Seidman or Pollack will make all decisions with respect to the
management of the Partnership. Either General Partner will have the authority to
bind the Partnership. Limited Partners have no right or power to take part in
the management of the Partnership. As a result, the success of the Partnership
for the foreseeable future depends largely upon the ability and continuing
availability of the General Partners.
Risks of Special Techniques and Short Sales.
Each of the special investment techniques that the Partnership may use is
subject to certain risks that are summarized below.
Short-Term Trading. Engaging in short-term trading may result in the
Partnership's experiencing significant turnover and transactions costs.
Leverage. Borrowing money to purchase securities will provide the
Partnership with the opportunity for greater capital appreciation but, at the
same time, may increase the Partnership's exposure to capital risk and higher
current expenses. Moreover, if the Partnership's revenue's were not sufficient
to pay the principal of and interest on the Partnership's debt when due,
Partners could sustain a total loss of their investment.
Short Sales. The possible losses to the Partnership from a short sale of a
security differ from losses that could be incurred from a cash investment in the
security; the former may be unlimited, whereas the latter can only equal the
total amount of the cash investment. Short-selling activities are subject to
restrictions imposed by the federal securities laws and the various securities
exchanges.
Options. Purchasing and selling call and put options entail risks. Although
an option buyer's risk is limited to the amount of the purchase price of the
option, an investment in an option may be subject to greater fluctuation than an
investment in the underlying securities. In theory, an uncovered call writer's
loss is potentially unlimited, but in practice the loss is limited by the
duration of the call. The risk for a writer of a put option is that the price of
the underlying security may fall below the exercise price.
The effectiveness of purchasing or selling stock index options as a hedging
technique depends upon the extent to which price movements in the portion of the
Partnership's hedged portfolio correlate with the price movements of the stock
index selected. Because the value of an index option depends upon movements in
the levels of the index rather that the price of a particular stock, whether the
Partnership realizes a gain or loss from the purchase or writing of options on
an index depends upon movements in the level of stock prices in the stock market
generally, rather than movements in the price of a particular stock. Successful
use by the Partnership of options on stock indexes will depend upon the ability
of the General Partners to predict correctly movements in the stock market
generally. This ability requires skills and techniques different from those used
in predicting changes in the price of individual stocks.
Small Cap Stocks
At any given time, the Partnership may have significant investments in
smaller-to-medium sized companies of a less seasoned nature whose securities are
traded in the over-the-counter market. These "secondary" securities often
involve significantly greater risks than the securities of larger, better-known
companies and may be more subject than large cap stocks to the market's
assessment of industry prospects as opposed to the company's financial
performance.
Derivative Instruments
Swaps, derivative and certain options and other custom derivative or
synthetic instruments are subject to the risk of nonperformance by the
counterparty to such instrument, including risks relating to the financial
soundness and creditworthiness of the counterparty. From time to time, the
Partnership may have limited exposure to such transactions.
High Risk Investments
The Partnership may invest in companies involved in (or the target of)
acquisition attempts or tender offers or companies involved in workouts,
liquidations, spin-offs, reorganizations, bankruptcies and similar transactions.
In any investment opportunity involving any such type of business enterprise,
there exists the risk that the transaction in which such business enterprise is
involved either will be unsuccessful, take considerable time or result in a
distribution of cash or a new security the value of which will be less than the
purchase price to the Partnership of the security or other financial instrument
in respect of which such distribution is received. Similarly, if an anticipated
transaction does not in fact occur, the Partnership may be required to sell its
investment at a loss. Because there is a substantial uncertainty concerning the
outcome of transactions involving financially troubled companies in which the
Partnership may invest, there is a potential risk of loss by the Partnership of
its entire investment in such companies.
Extraordinary Expenses
To the extent that the General Partners decide to aggressively seek to
convince management of a company in which the Partnership has taken a position
of the correctness of their vision regarding the company's prospects, abnormal
expenses may be incurred if management is resistant.
Lack of Liquidity of Partnership Assets
Partnership assets may, at any given time, include securities, partnership
interest or obligations for which no market exists and/or which are thinly
traded. The sale of any such investments may be possible only at substantial
discounts and such investment may be difficult to value accurately.
Illiquidity
The Interests are being offered without registration under the 1933 Act in
reliance upon an exemption contained in Section 4(2) of the 1933 Act and
Regulation D thereunder. Certain restrictions on transferability preclude
disposition and transfer of Interests other than pursuant to an effective
registration statement (which is not expected to exist) or in accordance with an
exemption from registration contained in the 1933 Act. In addition, the
Partnership Agreement requires that the consent of the General Partners be
obtained prior to the transfer of an Interest. In light of the restrictions
imposed on a transfer of an Interest, and in light of the limitations imposed on
a Partner's ability to withdraw all or part of his or its capital contribution
from the Partnership, an investment in the Partnership should be viewed as
illiquid and subject to high risk.
Changes in Applicable Law
The Partnership must comply with various legal requirements, including
requirements imposed by the federal securities laws and tax laws. Should any of
those laws change over the scheduled term of the Partnership, the legal
requirements to which the Partnership and the Partners may be subject could
differ materially from current requirements.
CONFLICTS OF INTEREST
The Partnership is subject to various conflicts of interest arising out of
its relationship to the General Partners. Conflicts of interest involving the
Partnership include, but are not limited to, the following:
Service of the General Partners
The Partnership depends on the General Partners for the day-to-day
operation of the Partnership. Messrs. Seidman and Pollack will devote as much of
their time to the business of the General Partners and Partnership as, in their
judgment, is reasonably required, but they are involved in other business
activities, and Mr. Seidman has organized and operates several limited liability
companies and partnerships that have the same investment purpose as the
Partnership. In addition, Mr. Seidman is paid a fee to advise certain individual
clients with respect to their purchase of publically traded securities,
principally thrift and bank stocks. As a result of their other activities, the
General Partners may have a conflict of interest in allocating management time,
services and functions among the Partnership and other business ventures.
Allocation of Investment Opportunities
The General Partners are responsible for the investment decisions made on
behalf of the Partnership. Either General Partner has the authority and is
responsible for the investment decisions of the Partnership. Mr. Seidman is also
responsible directly or indirectly for investment decisions made on behalf of
other potential clients, limited liability companies and partnerships. If a
determination is made that the Partnership and any other client should purchase
or sell the same securities at the same time, the securities will be allocated
in a manner believed to be equitable to each. Circumstances may occur, however,
in which an allocation could have adverse effects on the Partnership or the
other client with respect to the price or size of securities positions
obtainable or saleable.
Co-Investment by the General Partners
From time to time, Pollack or Seidman, in their individual capacity, may
invest in securities in which the Partnership invests. Pollack and Seidman will
not, however, purchase or sell any securities on terms more favorable than those
received by the Partnership.
General Partners' Share of Profits
The General Partners will receive a performance fee equal to 20% of the
Annual Net Profit of the Partnership. Because their compensation is performance
driven, the General Partners could be incentivized to make riskier investments
in the hope of maximizing profits.
Resolution of Conflicts
Under the terms of the Partnership Agreement, the General Partners, in
resolving a conflict of interest between the General Partners and their
affiliates and the Partnership or Limited Partners, will consider the relative
interests of the parties involved in the conflict, any customary or accepted
industry practices, and any applicable generally accepted accounting practices
or principles.
TAX CONSEQUENCES
A description of all of the aspects of Federal, state and local laws
that may affect the tax consequences of investing in the Partnership is beyond
the scope of this Private Placement Memorandum. The discussion that follows is
intended to be only a summary of certain tax considerations generally affecting
the Partnership and the Limited Partners. Prospective Limited Partners should
satisfy themselves as to the tax consequences of investing in the Partnership by
obtaining advice from their own tax advisor.
Federal Income Tax Considerations in General
The Partnership has been advised that the Partnership should be treated as
a partnership, and not as a corporation, for federal income tax purposes under
current regulations, rulings and decisions.
Each Limited Partner generally will be required to report on his federal
income tax return his distributive share of the Partnership's income, gains,
losses, deductions and credits, if any, for the tax year of the Partnership
ending within or with the Limited Partner's tax year. Because the Partnership's
income is taxable to the Partners when realized by the Partnership, it is not
usually taxed again when distributed to Partners. If the Partnership were taxed
as a corporation (1) the Partnership's income would be subject to corporate tax
rates; (2) Partnership items of income, gains, losses, deductions or credits
would not flow through to the Limited Partners; and (3) distributions to Limited
Partners, if any, would be taxed when distributed as dividends to the extent of
current earnings and profits.
It is uncertain as to whether, for Federal income tax purposes, the
Partnership will be considered to be engaged in an investment activity or in a
trade or business. If the Partnership is considered to be engaged in an
investment activity, an individual Limited Partner will be able to deduct his
share of the Partnership's expenses, including administrative fees, only to the
extent that those expenses (together with his other miscellaneous itemized
deductions) exceed 2% of his adjusted gross income. If the Partnership were not
considered to be engaged in an investment activity but were considered to be
engaged in a trade or business, then its partners would not be subject to the 2%
rule. However, such trade or business would not be considered a passive activity
and, therefore, losses and income of the Partnership from that trade or business
would be characterized as "non-passive" income or loss and could not be used by
a Limited Partner to offset other passive income or loss.
Whether the Partnership will be held to be engaged in a trade or business
or in an investment activity will depend on the extent and nature of the
Partnership's trading activity in any taxable year. This issue is largely
resolved on an analysis of facts, many of which will be known only in the
future. Moreover, it is unclear what legal standards would be applied to those
facts. Therefore, no clear guidance can be given whether the Partnership will be
considered to be engaged in a trade or business or an investment activity for
federal income tax purposes.
Under the Internal Revenue Code of 1986 (the "Code"), the deduction of
interest on funds borrowed to acquire or carry investment assets is limited.
This limit would apply to the interest expense of those Limited Partners, if
any, who borrow to purchase their Interests. In general, a deduction would be
disallowed to a noncorporate taxpayer to the extent his investment interest
expense exceeds his net investment income (i.e., the excess of non-trade or
business income from interest, dividends, rents and royalties, over expenses
incurred in earning the income).
The deduction of investment interest that is disallowed under these rules
is not lost permanently, but may be claimed as an investment interest deduction
in succeeding taxable years subject to the limitation described above.
A taxpayer may not, under the Code, deduct interest paid on indebtedness
incurred or continued for the purpose of purchasing or carrying obligations, the
income on which is exempt from tax. The Service will infer a purpose to carry
tax-exempt obligations whenever a taxpayer owns tax-exempt obligations and has
outstanding indebtedness that is neither directly connected with his personal
expenditures nor incurred in connection with his active conduct of a trade or
business. Ownership of an Interest should not constitute either a personal
expenditure or the active conduct by the taxpayer of a trade or business within
the meaning of the Code. Therefore, in the case of a Limited Partner owning
tax-exempt obligations, the Service might take the position that the Limited
Partner's allocable portion of any interest expense of the Partnership should be
viewed in whole or in part as incurred to enable the Limited Partner to continue
carrying the tax-exempt obligations and that the deduction of any interest by
the Limited Partner should be denied in whole or in part.
Federal Income Tax Rules Applicable
to Options and Hedging Transactions
The Federal income tax consequences of the Partnership's options and
hedging transactions depend upon the nature of any underlying security, whether
the option is written or purchased and whether the "1256 Contract" (which
addresses futures and foreign currency contracts and nonequity and dealer equity
options) or "straddle" rules apply to the transaction.
Options in General. When the Partnership writes a call or a put option it
receives a premium. If the option expires unexercised or is closed out, the
Partnership realizes a gain (or loss if the cost of closing out exceeds the
amount of the premium) without regard to any unrealized gain or loss on any
underlying security. Generally, any such gain or loss is a short-term capital
gain or loss. If a call option written by the Partnership is exercised, the
Partnership recognizes a capital gain or loss from the sale of the underlying
security, and treats the premium as additional sales proceeds. Whether the gain
or loss is long-term or short-term depends on the holding period of the
underlying security. If a put option written by the Partnership is exercised,
the amount of the premium reduces the tax basis of the security that the
Partnership then purchases.
If a purchased put or call option expires unexercised, the Partnership
realizes a capital loss equal to the cost of the option. If the Partnership
enters into a closing transaction with respect to the option, it realizes a
capital gain or loss (depending on whether the proceeds from the closing
transaction are greater or less than the cost of the option). The gain or loss
is short-term or long-term, depending on the Partnership's holding period in the
option. If the Partnership exercises a put option, it realizes a capital gain or
loss (short or long-term depending on its holding period for the underlying
security at the time it purchases the put) from the date of the underlying
security measured by the sales proceeds decreased by the premium paid. If the
Partnership exercised a call option, the premium paid for the option is added to
the tax basis of the security purchased. Certain options which could be
purchased by the Partnership that remain unexpired and unexercised at the end of
the Partnership's taxable year are treated as sold at their year-end fair market
value under the Section 1256 Contract rules and the corresponding gain or loss
is recognized for Federal income tax purposes.
Section 1256 Contracts. Gain or loss on Section 1256 Contracts are
taken into account for Federal Income tax purposes when actually realized. In
addition, Section 1256 Contracts remaining unexercised at the end of the
Partnership's taxable year are treated as sold and then repurchased at their
year-end fair Market value (i.e., "marked-to-market"), with the corresponding
gain or loss recognized for Federal income tax purposes. Generally, both the
realized and unrealized year-end gains or losses from these investment positions
are treated as 60% long-term and 40% short-term capital gain or loss, regardless
of the Partnership's actual holding period for the investments.
Straddles. The Partnership is generally authorized to enter into put,
call, covered call and other investments that may constitute one position in a
"straddle" when considered in conjunction with the other investments of the
Partnership. If two (or more) positions constitute a straddle, recognition of a
realized loss from one position (including a marked-to-market loss) must be
deferred to the extent of unrecognized gain in an offsetting position. In
addition, long-term capital gain may be recharacterized as short-term capital
gain, or short-term capital loss as long-term capital loss. Interest and other
carrying charges allocable to personal property that is part of a straddle must
also be capitalized.
The Partnership may identify particular offsetting positions as being
components of a straddle, and a realized loss is recognized no earlier than
upon the liquidation of all of the components of the identified straddle. If the
Partnership makes certain elections, the Section 1256 Contract components of a
straddle are not subject to the 60% long-term and 40% short-term
marked-to-market rules. Instead, the amount, the nature (as long-term or
short-term) and the timing of the recognition of the Partnership's gains or
losses from the affected straddle positions are determined under rules that vary
according to the type of election made.
A prospective investor in the Partnership should review the
application of these rules to his own particular tax situation with special
regard to the potential interaction between Partnership's operations and
transactions entered into by the investor in his own capacity.
Allocation of Taxable Income
As a consequence of new Limited Partners joining the Partnership and
existing Partners adding capital to or withdrawing capital from the Partnership
during a fiscal period of the Partnership, the allocation of taxable income for
tax purposes by the Partnership may differ from the way in which the benefits of
the income have been allocated among the Partners for financial purposes in any
one period.
State and Local Tax Consequences
Prospective investors in the Partnership should consider not only federal
income tax consequences, but also the potential state and local tax implications
of an investment in the Partnership. State and local taxation of Limited
Partners differ, depending largely upon place of residence.
Tax InformationTax
The General Partners provide the Limited Partners with such statements
and reports with respect to the Partnership's activities as are required to
enable the Limited Partners to file their annual tax returns.
ERISA Considerations
The Partnership may accept contributions from individual retirement
accounts, pension, profit-sharing or stock bonus plans, and governmental plans
(all such entities are herein referred to as "Retirement Trusts"). The
Partnership may accept capital contributions by Retirement Trusts that cause the
value of limited partnership interests in the Partnership held by Retirement
Trusts to constitute 25% or more of the value of the total limited partnership
interests in the Partnership, excluding Partnership interests held by the
General Partners or their affiliates. In such event, the Partnership's assets
would be considered "plan assets" under the Employee Retirement Income Security
Act of 1975, as amended ("ERISA"). A capital contribution by a Retirement Trust
that is subject to ERISA would in such event be an appointment of the General
Partners as an "investment manager" under such a Retirement Trust, and the
contribution must therefore be authorized by a person who had the authority
under the Retirement Trust's governing documents to appoint an "investment
manager", as well as the person responsible under the Retirement Trust documents
for making investment decisions for the portion of the Retirement Trust's assets
to be invested in the Partnership. Prior to investing in the Partnership,
prospective Retirement Trust investors should consult with legal counsel to
ensure that the governing instruments of the prospective investor provide for
appropriate provisions with respect to the appointment of the General Partners
as an "investment manager".
One of the consequences of the Partnership's assets being deemed "plan
assets" under ERISA would be applicability of the prohibited transaction
provision ERISA and Section 4975 of the Code. The prohibited transaction
provisions of ERISA prohibit may routine business transactions (such as sales,
leases, extensions of credit, and the provision of services) between a plan and
persons who are "parties in interest" to a plan. "Parties in interest" is a term
broadly defined to include numerous persons, including most importantly, any
person who provides services to a plan (such as a broker-dealer), as well as
fiduciaries. The prohibited transaction provisions of ERISA and Section 4975 of
the Code apply, unless a specific exemption is available, regardless of motive
and regardless of whether the transaction is beneficial to the plan.
The penalties for violation of the prohibited transaction rules include an
excise tax of 5 percent on the "amount involved" in the prohibited transaction
for each year the transaction is outstanding and not corrected, and the 5
percent excise tax can escalate to 100 percent if the amount involved in the
plan is not put back in at least as good a position as it would have been if the
prohibited transaction had not occurred within a specified period of time. The
latter requirement usually requires the transaction to be rescinded and may
require payment to the plan for a loss of earnings from the date of the
transaction to the date of the recission, and/or the disgorgement of profits.
There are, however, numerous statutory and administrative exemptions from
the prohibited transaction rules that may cover the Partnership's activities. It
is expected that these rules will not pose any significant restrictions on
investments because the Partnership engages primarily in open market
transactions on national securities exchanges and, with respect to off-exchange
transactions, the General Partners should qualify as a so-called "qualified
professional asset manager" as defined in one of the United States Department of
Labor's class exemptions from the prohibited transaction rules.
If the Partnership's assets are considered the assets of an investing
Retirement Trust that is subject to ERISA, each such investing Retirement Trust
will be required to reflect the assets and liabilities of the Partnership, and
in some cases the Partnership's income and expenses as well as certain
transactions engaged in by the Partnership, on its annual return/report files
with the Internal Revenue Service. To ease the burden of preparing such filings,
the Partnership intends to utilize the alternative method of compliance
described in DOL Regulation Section 2510.103-12 with respect to ERISA Plans that
file Form 5500 or Form 5500 C/R.
As a condition to admission to the Partnership, a Retirement Trust will be
required to make certain representations in the Agreement for Admission
including a representation that the investment in the Partnership by the
Retirement Trust has been authorized by the appropriate person or person and
that the Retirement Trust has consulted its counsel with respect to such
investment.
Unrelated Business Taxable Income ("UBTI")
The Partnership may use leverage in connection with its investment. In this
connection it should be noted that a tax-exempt entity (including a Retirement
Trust), which invests in the Partnership, would generally be subject to tax on
the portion of its share of Partnership profits attributable to the use of
leverage. This is because such portion of its share of profits will be
considered "debt-financed income" and will be taxable as "unrelated business
taxable income" under the Federal income tax law. The law is not entirely clear
as to the proper way to determine what portion of a tax-exempt partner's share
of Partnership profits is attributable to the use of leverage by the Partnership
and therefore is "debt-financed income". Accordingly, while the Partnership will
compute each tax-exempt partner's share of "debt-financed income" from the
Partnership in a manner, which the Partnership determines, is reasonable, there
can be no assurance that the Internal Revenue Service will accept the method of
computation utilized by the Partnership.
THE PARTNERSHIP AGREEMENT
The following is a brief discussion of certain provisions of the
Partnership Agreement, some of which are also described elsewhere in this
Private Placement Memorandum. To obtain more detailed information, reference
should be made to the Partnership Agreement, which is attached as Exhibit A.
Control
The General Partners have the exclusive right to manage and control the
affairs of the Partnership and either General Partner can bind the Partnership.
No Limited Partner is permitted to participate in the control of the
Partnership's business, transact any business in the Partnership's name or have
the power to sign documents for the Partnership or bind the Partnership in any
other way.
Liability of the General Partnerr
The doing of any act or the failure to do any act by the General Partners,
the effect of which may cause or result in loss, liability, damage or expense to
the Partnership or any Partner, does not subject the General Partners to any
liability to the Partnership or to any Partner, except that the General Partners
may be so liable if they act fraudulently or in bad faith, are grossly negligent
or guilty of willful misfeasance.
Liability of the Limited Partners
A Limited Partner is not liable for any debts or bound by any obligations
of the Partnership, except to the extent of his capital contribution. A Limited
Partner receiving a return of any part of the capital he contributed to the
Partnership is not liable to the Partnership for the amount of the return unless
he knew, at the time of the distribution that, after giving effect to the
distribution, all liabilities of the Partnership, other than liabilities to
Partners on account of their interests in the Partnership, exceeded the fair
value of the Partnership's assets.
Additional Contributions; New Limited Partners
Any Partner may elect, with the consent of the General Partners, to make
additional contributions to the Partnership's capital as of the first day of any
fiscal quarter of the Partnership and more frequently than quarterly.
New Limited Partners may be admitted to the Partnership. The General
Partners may, in their discretion, admit new Limited Partners as of the first
day of any fiscal quarter of the Partnership and more frequently than quarterly.
Form of Contributions
Contributions to the Partnership's capital must be made in cash.
Allocations
Except as otherwise provided in the Partnership Agreement regarding the
treatment of the "Hot Issues Account", allocation of Net Profits (as defined
below) is a two-step process. First, all Net Profits are provisionally allocated
to all Partners in proportion to their respective Capital Accounts. Then, 20% of
the Net Profits provisionally allocated to Limited Partners (except certain
Limited Partners affiliated with the General Partners) is reallocated to the
General Partners. This 20% reallocation is the "Incentive Allocation".
Notwithstanding the preceding, if a Net Loss has previously been allocated to
any Partner, no part of the Net Profits provisionally allocated to such
Partner's account are reallocated to the General Partners as an Incentive
Allocation until the amount of the loss has been recouped. This is referred to
in the Partnership Agreement as the "Recoupment Allocation". If a Limited
Partner who is entitled to a Recoupment Allocation withdraws any portion of his
Capital Account, the amount of Recoupment Allocation to which he is entitled is
reduced in proportion to the amount of capital withdrawn. Net Losses (as defined
below) are allocated to all Partners in proportion to their respective Capital
Accounts. The General Partners have unlimited liability for the obligations of
the Partnership. This means that if the Partnership were unable to pay its
obligations, creditors of the Partnership would have claims against the General
Partners. Accordingly, if the Partnership were to have a negative net worth,
which could be reflected as negative balances in the General Partners' Capital
Accounts, profits would be allocated to the General Partners until the negative
balances were eliminated. Thereafter, allocation of profits would return to the
normal basis described above.
For purposes of the allocation procedures described above, Net Profit of
the Partnership means, with respect to a particular fiscal period of the
Partnership, the excess of the aggregate revenue, income and gains (realized and
unrealized) earned on an accrual basis by the Partnership during the fiscal
period from all sources over the expenses and losses (realized and unrealized)
incurred on an accrual basis during the fiscal period. Net Loss, for purposes of
the allocation procedures described above, means, with respect to a fiscal
period of the Partnership, the excess of all expenses and losses (realized and
unrealized) incurred on an accrual basis during the fiscal period over the
aggregate revenue, income and gains (realized and unrealized) earned on an
accrual basis by the Partnership during the fiscal period from all sources.
Gains, losses and expenses are allocated by the Partnership for income tax
purposes in a manner so as to reflect as nearly as possible the amounts credited
or charges to each Partner's Capital Account under the financial allocation
procedures described above. All matters concerning the valuation of securities,
the allocation of profits, gains and losses among the Partners, including the
taxes on them, and accounting procedures, not specifically and expressly
provided for by the terms of the Partnership Agreement, are determined in good
faith by the General Partners, whose determinations are final, binding and
conclusive upon all of the Partners.
At such times as the General Partners wish to effect a transaction in the
Hot Issues Account (as described in Section 10 of the Partnership Agreement),
the requisite funds would be transferred to the Hot Issues Account from one or
more of the regular accounts. Securities involved in the distribution are
purchased in the Hot Issues Account. If sold, the proceeds of sale are
transferred from the Hot Issues Account to the regular account. If securities
are to be held, such securities are purchased by the regular account from the
Hot Issues Account at fair market value.
At the end of the particular Fiscal Period, if the Hot Issues Account has
been in existence in that Fiscal Period:
(A) interest is charged to the Limited Partners having a
beneficial interest in the Hot Issues Account on the monies
paid to purchase the securities in the Hot Issues Account.
Such interest is charges to the Limited Partners in accordance
with their interests in the Hot Issues Account (being based on
the relationship between their Capital accounts as of the
beginning of the Fiscal Period) at the rate from time to time
being paid, or which would have been paid, by the Partnership
for borrowed funds during the various period that funds from
regular accounts have been held in or made available to the
Hot Issues Account, and such interest is credited to all of
the Limited Partners in the Partnership in accordance with
their Capital accounts as of the beginning of the Fiscal
Period; and
(B) the gains or losses resulting from the various transactions in
the Hot Issues Account is credited or debited to the Limited
Partners having an interest in the Hot Issues Account in
accordance with their interest therein.
Expenses
The Partnership Agreement provides that the organizational expenses be
borne by the Partnership. The Partnership pays its own administrative, legal,
proxy and audit expenses and investment expenses such as commissions, research
fees, interest on margin accounts and other indebtedness, borrowing charges on
securities sold short, custodial fees, bank service fees and other reasonable
expenses related to the purchase, sale or transmittal of Partnership assets as
determined by the General Partners in their sole discretion. The Partnership
pays an administrative fee to the General Partners as of the end of each fiscal
quarter at an annual rate equal to 1% of the Partnership's Assets.
Withdrawals by Limited Partnersrs
After a Limited Partner has been a Partner of the Partnership for eight
full fiscal quarters, such Limited Partner may, as of the end of any fiscal year
of the Partnership, or at other times at the discretion of the General Partners,
withdraw all or any part of his Capital Account with the Partnership, so long as
the General Partners receive written notice of the intended withdrawal not less
than 90 days prior to the withdrawal date, stating the amount to be withdrawn. A
Partner requesting a withdrawal will be subject to such charge, as the General
Partners may determine, to cover the costs of selling securities and other costs
incurred in order to effect payment of such withdrawal. If the amount of a
withdrawal by a Limited Partner represents less than 75% of the Limited
Partner's Capital Account, the Limited Partner receives the proceeds of the
withdrawal within 30 days after the withdrawal date. If the amount of a Limited
Partner's withdrawal represents 75% or more of the Limited Partner's Capital
Account, the Limited Partner receives 75% of his Capital Account within 30 days
after the withdrawal date and the remainder of the amount withdrawn within 10
business days after the availability of the Partnership's financial statement
for the period including the withdrawal date. If a Limited Partner requests
withdrawal of capital, which would reduce the amount of his Capital Account
below the amount of his initial Capital Contribution, the General Partners may
treat such request as a request for withdrawal of all of such Limited Partner's
capital.
Any Limited Partner's Interest may be terminated by the Partnership as of
the end of any fiscal year of the Partnership upon 90 days prior written notice,
so long as the General Partners determine the termination to be in the best
interest of the Partnership. In the event that a Limited Partner's Interest is
terminated by the Partnership, the Limited Partner receives 90% of his Capital
Account within 100 days after notice of termination and the remaining 10% within
10 business days after the availability of the Partnership's financial
statements for the fiscal year in which his or its Interest is terminated.
The distribution of any amount withdrawn under any circumstances by a
Limited Partner or paid to him upon termination of his interest may take the
form of cash and or securities as determined by the General Partners in their
sole discretion.
Withdrawals by the General Partner and Limited
Partners that are Affiliates of General Partner
Each General Partner and each Limited Partner that is an affiliate of a
General Partner, has the right to withdraw an amount from his Capital Account as
of the end of any fiscal year of the Partnership, without prior notification to
the Limited Partners, if, giving effect to such withdrawal, the total amount of
the Capital Accounts of the General Partners and their affiliates is as least
$50,000. Although the General Partners do not intend to effect or permit any
withdrawals of capital which would reduce the aggregate of the Capital accounts
of the General Partners and their affiliates that are Limited Partners, to less
than $50,000, a General Partner may do so on 45 days prior notice to the Limited
Partners. In that event, if a Limited Partner gives notice to the General
Partners not later than 15 days after the date of such notice by the General
Partners, the Limited Partner may withdraw his capital as of the same date as
the withdrawal by the General Partners or Affiliates.
The General Partners may voluntarily resign or withdraw from the
Partnership as of the end of any fiscal year of the Partnership upon 60 days
written notice sent to all Partners. As noted below under "Term of Partnership",
the Partnership's business may be continued by the remaining General Partner in
the event of the withdrawal of a General Partner.
Term of PartnershipTerm of PartnershipTerm of Partnership
The scheduled term of the Partnership is until June 31, 2020. The
Partnership will terminate prior to the end of its scheduled term upon the
written consent of all Partners, upon the entry of a decree of judicial
dissolution, or upon an event of withdrawal or disqualification of all of the
General Partners.
Dissolution
On dissolution of the Partnership, the General Partner (or if there are no
General Partners remaining, one or more person selected by Limited Partners
holding a majority in interest of the Capital Accounts of Limited Partners) will
wind up the Partnership's affairs and will distribute the Partnership's assets
in the following manner and order: (1) in satisfaction of the claims of all
creditors of the Partnership, other than the General Partners; (2) in
satisfaction of the claims of the General Partners as creditors of the
Partnership; and (3)any balance to the Partners in the relative proportions that
their respective Capital Accounts bear to each other, those Capital Accounts to
be determined as if the fiscal year of the Partnership ended on the date of the
dissolution.
Reports
Limited Partners will receive interim information reports quarterly and
annual financial statements.
Amendments
The Partnership Agreement may be amended in whole or in part by the written
consent of the General Partners, and of Partners whose Capital Accounts
constitute a majority in interest of the total Partnership Capital Accounts at
that time. In addition, any provisions of the Partnership Agreement, other than
Section 9, which established the amount of profit and loss allocated to
Partners, may be amended by the General Partners in any manner that does not, in
the discretion of the General Partners, adversely affect any Limited Partner.
Indemnification
The Partnership indemnifies each General Partner and his associates,
employees and agents to the fullest extent permitted by law and holds each
harmless from and with respect to all (1) fees, costs and expenses incurred in
connection with, or resulting from, any claim, action or demand against the
General Partner, or any of his associates, employees or agents that arises out
of or in any way related to the Partnership, its properties, business or
affairs; and (2) any losses or damages resulting from any such claim, action or
demand, including amounts paid in settlement or compromise of the claim, action
or demand. This indemnification applies, however, only so long as the action or
failure to act by the General Partner or by his associates, employees or agents
does not constitute bad faith or willful misfeasance. Advances by the
Partnership to cover the cost of defense against such claims may be made to a
General Partner prior to the adjudication or other resolution thereof. If it is
subsequently determined by a court of competent jurisdiction that the General
Partner was not entitled to indemnification against liability arising from a
particular claim, action or demand, such General Partner will be required to
reimburse the Partnership for any advances made to cover the cost of the defense
against such claim, action or demand.
Rights of Transfer
No Limited Partner may assign or otherwise transfer his or its Interest, in
whole or in part, without the consent of the General Partners and without a
written opinion of counsel that the transfer is consistent with the 1933 Act and
applicable provisions of any state's "Blue Sky" law, and would not result in the
Partnership's having to register as an investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"). In addition, no Limited
Partner has the right to have his or its assignee admitted as a substitute
Limited Partner, except upon the written consent of the General Partners, which
consent may be withheld in the discretion of the General Partners.
INVESTING IN THE PARTNERSHIP
Minimum Subscription
Each potential Limited Partner must subscribe for a minimum of $100,000.
The General Partners in their discretion may waive this minimum subscription.
Investor Suitability Standards
The Interests offered pursuant to this Private Placement Memorandum are not
registered under the 1933 Act and must be acquired for investment and not with a
view to distributing them within the meaning of the 1933 Act. As a result,
offers and sales of the Interests are made by the Partnership only to affiliates
of the General Partners and to other prospective investors who, in the judgment
of the General Partners, satisfy the following suitability standards:
(1) The investor, if an individual, qualifies as an "accredited
investor" because he or she (a) has a net worth, or joint net
worth with his or her spouse, of at least $1,000,000, or (b)
had an individual income in excess of $200,000 in each of the
two most recent years, or joint income together with his or
her spouse in excess of $300,000 in each of those two years,
and reasonably expects to reach the same income level in the
current year.
(2) The investor, if an entity, qualifies as an "accredited
investor" because it is:
(a) a bank as defined in Section 3(a)(2) of the 1933 Act,
or a savings and loan association or other
institution as defined in Section 3(a)(5)(A) of the
1933 Act, whether acting in its individual capacity
or in a fiduciary capacity;
(b) a registered-broker-dealer;
(c) an insurance company as defined in Section 2(13) of
the 1933 Act;
(d) an investment company registered under the 1940 Act
or a business development company as defined in
Section 2(a)(48) of the 1940 Act1;
(e) a Small Business Investment Company licensed by the
Small Business Administration under Section 301(c)
or (d) of the Small Business Investment Act of 1958;
(f) any plan established and maintained by a state, its
political subdivisions, or any agency or
instrumentality of a state or its political
subdivisions, for the benefit of its employees, if
such plan has total assets in excess of $5 million;
(g) a private business development company as defined
in Section 202(a)(22) of the Investment Advisers Act
of 1940 (the "Advisers Act");
(h) an organization described in Section 501(c)(3) of the
Internal Revenue Code, a corporation, a Massachusetts
or similar business Trust, or a partnership, not
formed for the specific purpose of investing in the
Partnership, with total assets in excess of $5
million; or
(i) a trust with total assets in excess of $5 million,
not formed for the specific purpose of investing in
the Partnership, whose purchase is directly by a
person who the General Partner has no reason to
believe has such knowledge and experience in
financial and business matters that he is capable of
evaluating the merits and risks of investment in the
Partnership;
(j) any other entity all of the equity owners of which
are "accredited investors".
(3) The investor must have the ability to bear the economic risks
of his investment in the Partnership.
(4) The investor must have sufficient knowledge and experience
in financial, business or investment matters to evaluate
the merits and risks of his investment,
(5) The investor must confirm and represent that his Interest in
the Partnership is being acquired for investment and not with
a view to distribution.
(6) The investor must not be a non-resident alien or foreign
corporation, foreign trust or foreign estate.
(7) The investor must be an individual or a "company" which either
has assets of at least $1 million or has invested at least
$100,000 in the Partnership. However, the General Partners may
sell Limited Partnership interest to 35 investors who do not
meet the above criteria.
Each investor is required to make certain other representations to the
Partnership, including (but not limited to) representations as to his access to
information concerning the Partnership.
Access to Information
The General Partners will make available to prospective investors any
non-propriety materials available to the General Partners relating to the
Partnership, and will answer all inquiries from prospective investors concerning
the Partnership, the General Partners, the business of the Partnership, and any
other matters relating to the formation of the Partnership and the offer and
sale of the Interests. The General Partners will also afford prospective
investors the opportunity to obtain any additional non-propriety information (to
the extent the General Partners possess that information or can acquire it
without unreasonable effort or expenses) necessary to verify the accuracy of any
representations or information contained in this Private Placement Memorandum.
Prospective investors are invited to communicate directly with Messrs.
Seidman or Pollack, as the representatives of the General Partner should be
directed to the Partnership's office located at 47 Blueberry Drive, Woodcliff
Lake, New Jersey 07675. Mr. Seidman's phone number is (973) 560-1400, Ext. 108
Mr. Pollack's phone number is (610) 892-8162.
Method of Subscription
An investor may subscribe to purchase an Interest by (1) completing,
dating and signing two copies of the Subscription Agreement accompanying this
Private Placement memorandum, (2) signing and having notarized the Limited Power
of Attorney delivered with this Private Placement Memorandum, and (3)delivering
the signed copies of the foregoing documents to a General Partner together with
a check in an amount equal to the Dollar amount of the Interest to be purchased.
The General Partners reserve the right to accept or reject any subscription in
their discretion for any reason whatsoever. Amounts paid by any subscriber whose
subscription is rejected will be promptly returned.
MISCELLANEOUS SECURITIES
Registration Under the Investment Act
The General Partners do not intend to register as an investment adviser
under the Investment Advisers Act of 1940, as amended. If the General Partners
were registered as investment adviser, they would be subject to various
requirements, including restrictions relating to the manner in which their
compensation for investment advisory services could be computed. Prospective
investors should understand that the compensation arrangements of the
Partnership Agreement may create an incentive for the General Partners to cause
the Partnership to make investments that are riskier or more speculative than if
their compensation did not depend on the Net Profit of the Partnership. See
"CONFLICTS OF INTEREST-General Partners' Share of Profits".
Exemption from the Investment Company Act
To ensure that the Partnership is exempt from registration under the
Investment Company Act, the General Partners may limit the number of Limited
Partners and the percentage interest in the Partnership that may be held by
certain investors.
ADDITIONAL INFORMATION
This Private Placement Memorandum is intended only to be a summary of the
more significant features of investing in the Partnership and is qualified by
the provisions of the Partnership Agreement.
PROFESSIONAL ASSISTANCE
Mr. Dennis Pollack prepared the Offering Memorandum and Partnership
Agreement and no independent counsel passed upon the legal matters on behalf of
the Partnership. The Partnership intends to retain Schonbraun Sapris McCann
Bekritsky & Co., LLC of Roseland, New Jersey, as the independent accountant firm
for the Partnership.
EXHIBIT A
AGREEMENT OF LIMITED PARTNERSHIP OF
POLLACK INVESTMENT PARTNERSHIP, L.P.
THIS AGREEMENT OF LIMITED PARTNERSHIP of Pollack Investment
Partnership, L.P. (The "Partnership"), dated as of June 2000, by and between
Lawrence B. Seidman and Dennis Pollack, as the General Partners (the "General
Partners") and the persons and entities, referred to in schedule A on file at
the offices of the Partnership, who have executed this Agreement, either
directly or indirectly by an attorney-in-fact, as limited partners (the "Limited
Partners").
PREMISES:
The Partnership was organized in accordance with the New Jersey revised
Uniform Limited Partnership Act by the filing by the General Partners of a
Certificate of Limited Partnership with the office of the Secretary of State of
the State of New Jersey on
----------------,
NOW, THEREFORE, in consideration of the premises and the mutual
covenants hereinafter contained, effective as of June , 2000, it is hereby
agreed as follows:
1. Definitions
The following terms shall have the following meaning when used in this
Agreement:
(a) "Act" shall mean the New Jersey Revised Uniform Limited Partnership
Act, as amended from time to time.
(b) "Affiliate" shall mean any person performing services on behalf of the
Partnership who (i) directly or indirectly controls, is controlled by, or is
under common control with a General Partner; (ii) is a company of which either
or both of the General Partners are a controlling shareholder or an officer,
director, partner or trustee; (iii) a member of the family of either of the
General Partners; or (iv) an Individual Retirement Account or similar trust for
the benefit of either or both of the General Partners.
(c) "Agreement" shall mean this Agreement of Limited Partnership of the
Partnership, as originally executed and as amended, modified, supplemented or
restated from time to time.
(d) "Capital Account" shall mean the account described in Section 8 of this
Agreement.
(e) "Certificate" shall mean the Partnership's Certificate of Limited
Partnership as defined in Section 2 of this Agreement.
(f) "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations issued thereunder.
(g) "Fiscal Period" shall mean the period beginning on the day immediately
succeeding the last day of the immediately preceding Fiscal Period and ending on
the earliest occurring of the following:
(i) The last day of the Fiscal Year;
(ii) The day immediately preceding the day on which a new
Partner is admitted to the Partnership;
iii) The day immediately preceding the date on which a
Partner makes an additional capital contribution to the Partner's capital
account;
(iv) The day on which a Partner withdraws, in whole or in
part, the amount of his Capital Account;
(v) The date of dissolution of the Partnership in
accordance with Section 5 of this Agreement.
(h) "Fiscal Quarter" shall mean a fiscal quarter of the Partnership.
(i) "Fiscal Year" shall mean the fiscal year of the Partnership, which
shall correspond to the calendar year.
(j) "General Partners Percentage" shall mean a percentage established by
the General Partners for each General Partner on the Partnership's books as of
the first day of each Fiscal Period. The sum of the Percentages for each Fiscal
Period shall equal one hundred percent (100%).
(k) "Net Profit" of the Partnership shall mean, with respect to any Fiscal
Period, theexcess of the aggregate revenue, income and gains (realized and
unrealized) earned on an accrual basis during the Fiscal Period by the
Partnership from all sources over the expenses and losses (realized and
unrealized) incurred on an accrual basis during the Fiscal Period by the
Partnership.
(l) "Net Loss" of the Partnership shall mean, with respect to any Fiscal
Period, the excess of all expenses and losses (realized and unrealized) incurred
on an accrual basis, during the Fiscal Period by the Partnership over the
aggregate revenue, income and gains (realized and unrealized) earned on the
accrual basis during the Fiscal Period by the Partnership from all sources.
(m) "Partnership Percentage" shall mean a percentage established for each
partner on the Partnership books as of the first day of each Fiscal Period. The
Partnership Percentage of a Partner for a Fiscal Period shall be determined by
dividing the amount of the Partner's Capital Account as of the beginning of the
Fiscal Period by the sum of the capital accounts of all of the Partners as of
the beginning of the Fiscal Period. The sum of the Partnership Percentage for
each Fiscal Period shall equal one hundred percent (100%).
2. Organization.
The General Partners have executed a Certificate of Limited Partnership
pursuant to the provisions of the Act (the "Certificate") and have caused the
Certificate to be filed as required by the Act. The General Partners shall also
execute and record all amendments to the Certificate or additional certificates
as may be required by this Agreement or by law.
3. Name of Partnership.
The name of the Partnership shall be Pollack Investment Partnership, L.P.,
or such other name as the General Partners may from time to time designate.
4. Principal Office, Resident Agent, Registered Office
The principal office of the Partnership is 47 Blueberry Lane, Woodcliff
Lake, NJ 07675 or any other place determined by the General Partners. The
Partnership's phone number is (973) 560 -1400 ext. 108. The name and address of
the registered agent for service of process in the State of New Jersey is Dennis
Pollack, 47 Blueberry Lane, Woodcliff Lake, NJ 07675. The address of the
registered office of the Partnership in the State of New Jersey is c/o Dennis
Pollack, 47 Blueberry Lane, Woodcliff Lake, NJ 07675.
5. Term of the Partnership.
(a) The term of the Partnership, having commenced on the date the
Certificate was filed, shall continue until the first of the following events
occurs:
(i) June 31, 2020;
(ii) a written consent to dissolution of the Partnership
by all Partners;
(iii) all of the General Partners ceasing to be General
Partners as a result of doing or being subject to one or more of the following:
(A) withdrawing from the Partnership in accordance with Section 21 of this
Agreement;
(B) assigning all of his interest in the Partnership;
(C) making an assignment for the benefit of his creditors;
(D) filing a voluntary petition in bankruptcy;
(E) being adjudged bankrupt or insolvent or having entered against him an
order of relief in any bankruptcy or insolvency proceeding;
(F) filing a petition or answer seeking for himself any reorganization,
arrangement, composition, readjustment, liquidation, dissolution, or similar
relief under any statute, law, or regulation;
(G) filing an answer or other pleading admitting or failing to contest the
material allegations of a petition filed against him in any proceeding seeking
reorganization, arrangement, composition, readjustment, liquidation,
dissolution, or similar relief under any statute, law or regulation;
(H) seeking consenting to, or acquiescing in the appointment of a trustee
or receiver, or liquidator of all or any substantial part of his properties;
(I) being the subject of any proceeding seeking reorganization,
arrangement, composition, readjustment, liquidation, dissolution, or similar
relief under any statute, law or regulation, which proceeding shall have
continued for one hundred and twenty (120) days after the commencement thereof;
or the appointment of a trustee, receiver, or liquidator for him or all or any
substantial part of his properties without his consent or acquiescence, which
appointment is not vacated or stayed within ninety (90) days after the
appointment;
(J) the death of a General Partner; or
(K) the entry by a court of competent jurisdiction adjudicating him
incompetent to manage his person or his property; or
(iv) issuance of a non-appealable decree of dissolution of the Partnership
by a New Jersey court of competent jurisdiction.
(b) In the event a General Partner does or becomes subject to any of the
provisions of subsection (a)(iii) of this Section 5, the remaining General
Partner shall be permitted to carry on the business of the Partnership upon
written notice provided to all Partners of the decision to continue the
Partnership's business.
(c) If any one or more of the termination events listed in this Section 5
occurs, and if the remaining General Partner chooses not to carry on the
business of the Partnership in accordance with the provisions of subsection (b)
of this Section 5, the Partnership shall be dissolved and its affairs wound up
as provided in Section 22 of this Agreement.
6. Purposes.
The Partnership is organized for the following purposes:
(a) to invest and trade, on margin or otherwise, in "Securities", as that
term is defined in Section 2(1) of the Securities Act of 1933, as amended (the
"1933 Act");
(b) to sell Securities short and cover short sales;
(c) to lend funds or properties of the Partnership; either with or without
security; and
(d) to execute, deliver and perform all contracts and other undertakings,
and engage in all activities and transactions, that the General Partners believe
are necessary or advisable in carrying out the purposes specified subsections
(a), (b), and (c) of this Section 6, including without limitation:
(i) to purchase, transfer or acquire in any manner and exercise all rights,
powers, privileges and other incidents of ownership or possession with respect
to the investments described in subsection (a) of this Section 6; and
(ii) to register or qualify the Partnership under any applicable Federal or
state laws, or to obtain exemptions under those laws, if registration,
qualification or exemption is deemed necessary by the General Partners.
7. Contributions of the Partners; New Partners.
(a) Each Partner shall make a contribution to the Partnership's capital
("Capital Contribution") in the amount set out opposite the Limited Partner's
name in Schedule A attached to this Agreement.
(b) Any Partner may elect, with the consent of the General Partners, to
make an additional Capital Contribution, as of the first day of any Fiscal
Quarter. The General Partners may, in their sole discretion, permit additional
Capital Contributions to be made more frequently than quarterly.
(c) No Partner shall be required to make any additional Capital
Contributions.
(d) Capital Contributions made by Limited Partners must be in cash.
(e) The General Partners shall have the right, but not the obligation, to
admit new Partners to the Partnership as of the first day of any Fiscal Quarter.
The General Partners may, however, in their sole discretion, admit new Partners
more frequently than quarterly.
8. Capital Accounts.
A Capital Account shall be established for each Partner. For the Fiscal
Period during which a Partner is admitted to the Partnership, his Capital
Account shall equal the amount of his initial Capital Contribution. For each
subsequent Fiscal Period, the Partner's Capital Account will equal the sum of
the amount of his Capital Account as finally adjusted for the immediately
preceding Fiscal Period and the amount of any additional Capital Contributions
made by the Partner as of the first day of the current Fiscal Period.
9. Adjustments to Capital Accounts.
At the end of the Fiscal Period, the Capital Accounts of the Partners shall
be adjusted in the following manner:
(a) Subject to the provisions of subsections (c) and (d) and (f) of this
Section 9, Net Profit of the Partnership for the Fiscal Year shall be credited
as follows:
(i) Twenty percent (20%) of the Net Profit shall be reallocated to the
General Partners for each Fiscal Year as an "Incentive Allocation" to be divided
equally between the General Partners.
(ii) The remaining Net Profit shall be allocated to the Partners in
proportion to their Capital Accounts.
(b) Net Loss of the Partnership for the Fiscal Year shall be debited
against the Capital Account of each Partner in proportion to an in accordance
with the balance in the Capital Account of the Partner until the value of any
Partners' Capital Account becomes zero. Thereafter, any remaining Net Loss for
the Fiscal Year shall be debited to Partners having positive balances in their
Capital Accounts in proportion to those balances, until the value of each
Partner's Capital Account becomes zero. Thereafter, any remaining Net Loss for
the Fiscal Year shall be debited to the General Partners in accordance with each
General Partner's General Partners' Percentage for the Fiscal Period.
(c) In the event that the Capital Account of one or more General Partners
has a negative balance, one hundred percent (100%) of the Net Profit of the
Partnership for the Fiscal Period shall be credited to the General Partner(s)
whose Capital Accounts have negative balances in accordance with their
respective General Partners' Percentages until no General Partner shall have a
negative Capital Account balance.
(d) Anything in this Section 9 to the contrary notwithstanding, if any Net
Losses are allocated to the account of any Limited Partner, each such Limited
Partner shall be entitled to a "Recoupment Allocation" of subsequent Net Profits
of the Partnership, in an amount in proportion to his Partnership Percentage,
until such Net Loss shall have been eliminated. The amount of Net Profits
allocated as a Recoupment Allocation shall not exceed, but shall reduce, the
amount of Net Profits otherwise allocable to the General Partners as the
Incentive Allocation pursuant to Section 9(a)(ii) hereof. If a Limited Partner
who is entitled to a Recoupment Allocation shall withdraw any portion of his
Capital Account, the amount of Recoupment Allocation to which he is entitled
shall be reduced in proportion to the amount of capital withdrawn.
(e) The amount of any withdrawal made by the Partner pursuant to Section 21
or Section 22 of this Agreement shall be debited against the Capital Account of
that Partner.
(f) Allocations of Net Profit or Net Loss for a Fiscal Period, if
necessary, shall be made in accordance with each Partner's Partnership
percentage, adjusted as provided in paragraph (a) of this Section 9 at the end
of the Fiscal Year, provided that the "Incentive Allocation" may not exceed
twenty percent (20%) of the Net Profit for the Fiscal Year.
10. Hot Issues.
In the event the General Partners decide to invest in securities which are
the subject of a public distribution and which the General Partners, in their
sole discretion, believe may become a "hot issue" as that term is defined in
Article III, Section 1 of the Rules of Fair Practice of the National Association
of Securities Dealers, Inc. (the "NASD"), such investment shall be made in
accordance with the following provisions:
(a) any such investment made in a particular Fiscal Period shall be made in
a special account (the "Hot Issue Account");
(b) only those Partners who do not fall within the proscription of Article
III, Section I of said NASD Rules of Fair Practice ("Unrestricted Partners")
shall have any beneficial interest in the Hot Issues Account;
(c) each Unrestricted Partner shall have a beneficial interest in the Hot
Issues Account for any Fiscal Period in the proportion which such Unrestricted
Partner's Capital Account, as of the beginning of the Fiscal Period, bore to the
sum of the Capital Accounts of all Unrestricted Partners as of the beginning of
such Fiscal Period.
(d) funds required to make a particular investment shall be transferred to
the Hot Issues Account from the regular account of the Partnership; securities
involved in the public distribution shall be purchased in the Hot Issues
Account, held in the Hot Issues Account and eventually sold from the Hot Issues
Account or transferred to the regular account at fair market value as of the day
of transfer as determined by the General Partners with such transfer being
treated as a sale; if such securities are sold from the Hot Issues Account, the
proceeds of the sale shall be transferred from the Hot Issues Account to the
regular account of the Partnership.
(e) as of the last day of each Fiscal Period in which a particular
investment or investments are held in the Hot Issues Account: (A) interest shall
be debited to the Capital Accounts of the Unrestricted Partners in accordance
with their beneficial interest in the Hot Issues Account at the interest rate
being paid by the Partnership from time to time for borrowed funds during the
period in that Fiscal Period that funds from the regular account have been held
in or made available to the particular Hot Issues Account or, if no such funds
are being borrowed during such period, the interest rate that the General
Partners determine would have been paid if funds had been borrowed by the
Partnership during such period; and such interest shall be credited to the
Capital Accounts of all the Partners, both General and Limited, in the
proportions which (i) each Partner's Capital Account as of the beginning of such
Fiscal Period bore to (ii) the sum of the Capital Accounts of all Partners as of
the beginning of such Fiscal Period and (B) any Net Profits or Net Losses during
such Fiscal Period with respect to the Hot Issues Account shall be allocated to
the Capital Accounts of the Unrestricted Partners in accordance with their
beneficial interest in the Hot Issues Account during such Fiscal Period;
provided, however, that the amount of such interest shall not exceed the amount
of profit accrued in the Hot Issues Account; and
(f) the determination of the General Partners as to whether a particular
Partner falls within the proscription of Article III, Section I of the NASD
Rules of Fair Practice shall be final.
11. Valuation.
The Partnership's assets shall be valued in accordance with the following
principles:
(a) Any Security that is listed on a national securities exchange will be
valued at its last sale price on the date of determination as recorded by the
composite tape system, or if no sales occurred on that day, at the mean between
the closing "bid" and "asked" prices on that day as recorded by the system or
the exchange, as the case may be;
(b) Any Security that is a National Market Security will be valued at its
last sale price on the date of determination as reported by the National
Association of Securities Dealers Automated Quotations System ("NASDAQ") or if
no sale occurred on that day, at the mean between the closing "bid" and "asked"
prices on that day as reported by NASDAQ;
(c) Any Security not listed on a national securities exchange and not a
National Market Security will be valued at the mean between the closing "bid"
and "asked" prices on the date of determination as reported by NASDAQ or, if not
so reported, as reported in the over-the-counter market in the United States;
(d) An option shall be valued at the last sales price or, in the absence of
a last sales price, the last offer price; and
(e) All other Securities shall be assigned the value that the General
Partners in good faith determine.
12. Determination by General Partners of Certain Matters.
(a) All matters concerning the valuation of Securities, the allocation of
profits, gains and losses among the Partners, including the taxes on them and
accounting procedures, not specifically and expressly provided for by the terms
of this Agreement, shall be determined in good faith by the General Partners,
whose determination shall be final, binding and conclusive upon all of the
Partners.
(b) Gains, losses, and expenses of the Partnership for each Fiscal Period
shall be allocated among the Partners for income tax purposes in a manner so as
to reflect, as nearly as possible, the amounts credited or charged to each
Partner's Capital Account pursuant to Section 9 of this Agreement.
(c) The General Partners shall have the power to make all tax elections and
determination for the Partnership, and to take any and all action necessary
under the Code or other applicable law to effect those elections and
determinations. All such elections and determinations by the General Partners
shall be final, binding and conclusive upon all Partners.
13. Liability of Partners.
(a) The General Partners shall not be obligated to contribute cash or other
assets to the Partnership to make up deficits in their Capital Accounts or in
the Capital Accounts of the Limited Partners either during the term of the
Partnership or upon liquidation. The General Partners shall be liable for all
debts and obligations of the Partnership to the extent that the Partnership is
unable to pay such debts and obligations.
(b) The doing of any act or the failure to do any act by a General Partner,
the effect of which may cause or result in loss, liability, damage or expense to
the Partnership or any Partner shall not subject a General Partner to any
liability to the Partnership or to any Partner, except that a General Partner
may also be liable if he has not acted in good faith, was guilty of willful
misfeasance or was grossly negligent.
(c) A Limited Partner will not be liable for any debts or bound by any
obligations of the Partnership except to the extent set forth in subsections
(d), (e) and (f) of this Section 13.
(d) A Limited Partner who has received the return of any part of his
Capital Contribution without violation of this Agreement or the Act shall not be
liable therefore to the Partnership or its creditors.
(e) A Limited Partner receiving a return of any portion of his Capital
Contribution in violation the Act or this Agreement will be liable to the
Partnership for a period of six (6) years thereafter for the amount of the
contribution wrongfully returned.
(f) A Limited Partner may be liable to the Partnership or creditors of the
Partnership for any amounts distributed if, and to the extent that, at the time
of the distribution, he actually knew that, after giving effect to the
distribution, all liabilities of the Partnership, other than liabilities to
Partners on account of their interest in the Partnership, exceeded the fair
value of the Partnership's assets.
14. Rights and Duties of the General Partners.
(a) The General Partners shall have the exclusive right to manage and
control the affairs of the Partnership, and shall have the power and authority
to do all things necessary or proper to carry out the purposes of the
Partnership. The General Partners shall devote an amount of time and attention
that the General Partners in their sole discretion deems necessary or
appropriate.
(b) Without limiting the generality of the foregoing, the General Partners
shall have full power and authority to:
(i) engage independent agents, investment advisors, attorneys, accountants
and custodians as the General Partners deem necessary or advisable for the
affairs of the Partnership;
(ii) receive, buy, sell, exchange, trade, and otherwise deal in and with
Securities and other property of the Partnership;
(iii) open, conduct and close accounts with brokers on behalf of the
Partnership and to pay the customary fees and charges applicable to transactions
in those accounts;
(iv) open, maintain and close accounts, including margin accounts, with
brokers and banks, and to draw checks and other orders for the payment of money
by the Partnership;
(v) file, on behalf of the Partnership, all required local, state and
Federal tax and other returns relating to the Partnership;
(vi) cause the Partnership to purchase or bear the cost of any insurance
covering the potential liabilities of the General Partners and any associate,
employee or agent of the General Partners arising out of the General Partner's
actions as General Partner under this Agreement;
(vii) cause the Partnership to purchase or bear the cost of any insurance
covering the potential liabilities of any person serving as a director, officer
or employee of an entity in which the Partnership has an investment or of which
the Partnership is a creditor;
(viii) commence or defend litigation or submit to arbitration any claim or
cause of action that pertains to the Partnership or any Partnership assets;
(ix) enter into, make and perform contracts, agreements and other
undertakings, and to do any other acts, as the General Partners deems necessary
or advisable for, or as may be incidental to, the conduct of the business of the
Partnership, including, without limiting the generality of the foregoing,
contracts, agreements, undertakings and transactions with any Partner or with
any other person, firm or corporation having any business, financial or other
relationship with any Partner or Partners;
(x) make or revoke elections pursuant to Section 754 of the Code and adjust
the basis of the Partnership's property as permitted by Sections 734(b) and
743(b) of the Code;
(xi) designate a Tax Matters Partner for all purposes under the Code; and
(xii) resolve conflicts of interest between themselves and/or their
Affiliates and the Partnership and/or the Limited Partners.
15. Expenses.
The Partnership shall bear all expenses relating to its organization. The
Partnership will also bear administration, accountant, legal counsel, and proxy
expenses, as well as expenses of investments including, without limitation,
commissions, research fees, interest on debt and bank service fees.
16. Administrative Fee.
The Partnership shall pay the General Partners, as of the end of each
Fiscal Quarter of the Partnership, an administrative fee at an annual rate equal
to1% of the value of the Partnership's assets.
17. Limitation on Powers of Limited Partners.
No Limited Partner shall participate in the control of the Partnership's
business, transact any business in the Partnership's name or have the power to
sign documents for the Partnership or bind the Partnership in any other way.
18. Other Business Ventures.
Each Partner agrees that each General Partner and his affiliates and
associates may engage in other business activities or possess interest in other
business activities of every kind and description, independently or with others.
These activities may include, without limitation, establishing a
broker-dealership and investing in real estate and real estate related
partnerships, or investing, financing, acquiring and disposing of interests in
securities in which the Partnership may from time to time invest, or in which
the partnership is able to invest or otherwise have any interest. The Limited
Partners agree that the General Partners and their affiliates may act as General
Partners of other partnerships, including investment partnerships and may sit on
the Boards of Directors or hold operating officer positions with companies in
which the Partnership has an interest and may retain for their own personal
accounts any financial compensation or benefits derived therefrom.
19. Limitation on Assignability of Interest of Limited Partners.
(a) No Limited Partner may assign or otherwise transfer or encumber his
interest in the Partnership, in whole or in part, without the consent of the
General Partners and without a written opinion of counsel to or approved by the
General Partners that the proposed transfer (i) is consistent with all
applicable provisions of the 1933 Act, and the rules and regulations thereunder,
as from time to time in effect, as well as any applicable provisions of any
state "blue sky" law; and (ii) would not result in the Partnership's having to
register as an investment company under the Investment Company Act of 1940, as
amended.
(b) Notwithstanding any other provision of this Agreement, any successor to
any Limited Partner shall be bound by the provisions of this Agreement. Prior to
recognizing any assignment of an interest in the Partnership that has been
transferred in accordance with this Section 19, the General Partners may require
the transferring Limited Partner to execute and acknowledge an instrument of
assignment in form and substance satisfactory to the General Partners, and may
require the assignee to agree in writing to be bound by all the terms and
provisions of this Agreement, to assume all of the obligations of the assigning
Limited Partner and to execute whatever other instruments or documents the
General Partners deems necessary or desirable in connection with the assignment.
(c) No Limited Partner shall have the right to have his assignee admitted
as a substitute Limited Partner, except upon the written consent of the General
Partners, which consent may be withheld in the sole discretion of the General
Partners.
(d) Each Limited Partner hereby approves the admission to the Partnership
as a Limited Partner of any assignee who succeed to the interest in the
Partnership of a Limited Partner in accordance with the provisions of this
Section 19.
20. Withdrawals by a Limited Partner
(a) (i) A Limited Partner who shall have been a Limited Partner for at
least eight full Fiscal Quarters shall have the right, as of the end of any
Fiscal Year, or at other times at the discretion of the General Partners to
withdraw all or a portion of the amount of his Capital Account, so long as the
General Partners receives written notice of the intended withdrawal not less
than ninety (90) days prior to the withdrawal, stating the amount to be
withdrawn. In no event, however, shall a Limited Partner be permitted to
withdraw any amounts from his Capital Account in excess of the positive balance
of his Capital Account. If the amount of a Limited Partner's withdrawal
represents less than seventy-five percent (75%) of the Limited Partner's Capital
Account, the Limited Partner will receive the proceeds of the withdrawal within
thirty (30) days after the date of withdrawal. If the amount of a Limited
Partner's withdrawal represents seventy-five percent (75%) or more of the
Limited Partner's Capital Account, the Limited Partner will receive seventy-five
percent (75%) of his Capital Account within thirty (30) days after the date of
withdrawal and the remainder of the amount withdrawn within ten (10) days after
the Partnership has received financial statements from its independent certified
public accountants pursuant to Section 23(c) of this Agreement. If a Limited
Partner requests withdrawal of capital, which would reduce his Capital Account
below the amount of his initial Capital Contribution, the General Partners may
treat such request as a request for withdrawal of all of such Partner's Capital
Account. The distribution of any amount withdrawn by a Limited Partner may take
the form of cash and/or marketable securities as determined by the General
Partners in their sole discretion. A Limited Partner who requests a withdrawal
shall be subject to a charge determined by the General Partners, in their sole
discretion, to cover the costs related to such transaction.
(ii) In the event of a proposed withdrawal of capital by one or more
General Partners or Affiliates pursuant to Section 21(a)(ii) of this Agreement,
as a result of which the aggregate of the Capital Accounts of the General
Partners and Affiliates will be less than $50,000, a Limited Partner shall have
the right to withdraw all or a portion of the amount of his Capital Account, so
long as the General Partners receive written notice of the intended withdrawal
not more than fifteen (15) days after the date of the notice of withdrawal by
such General Partner or General Partners or Affiliate or Affiliates pursuant to
Section 21(a)(ii), stating the amount to be withdrawn. In such event the
withdrawal by such Limited Partner shall be effective as of the effective date
of the withdrawal by the General Partners pursuant to said Section 21(a)(ii).
The amount available for withdrawal shall be calculated in the same manner as
provided for in the last sentence of paragraph (b) of Section 5 hereof.
(b) Any Limited Partner's interest in the Partnership may be terminated by
the Partnership as of the end of any Fiscal Year upon prior written notice, so
long as the General Partners determine the termination to be in the best
interest of the Partnership. In the event that a Limited Partner's interest in
the Partnership is terminated pursuant to this Section 20, the Limited Partner
shall receive ninety percent (90%) of the value of his Capital Account within
one hundred (100) days after written notice of termination is given by the
Partnership and the remaining ten percent (10%) within ten (10) business days
after receipt of the Partnership of financial statements with respect to the
Fiscal Year in which his interest in the Partnership is terminated.
21. Withdrawals by the General Partners and Their Affiliates.
(a) (i) Each General Partner and each Affiliate of a General Partner shall
have the right to withdraw any amount of cash from his Capital Account as of the
end of any Fiscal Year, without prior notification to the Limited Partners,
provided that, after giving effect to such withdrawal, the aggregate Capital
Accounts of the General Partners and their Affiliates are not less than $50,000.
(ii) Upon forty-five (45) days' prior notice to the Limited Partners, a
General Partner or an Affiliate may withdraw any amount from his Capital Account
contributed to the Partnership as a result of which withdrawal the aggregate
Capital Accounts of the General Partner and their Affiliates would be reduced
below $50,000.
(b) Any or all of the General Partners may voluntarily resign or withdraw
from the Partnership as of the end of any Fiscal Year upon sixty (60) days'
written notice sent to all Partners.
22. Dissolution and Winding Up of the Partnership.
On dissolution of the Partnership, the General Partners or if there is no
General Partner, one or more persons approved by the Limited Partners holding a
majority in interest of the Capital Accounts of the Limited Partners shall wind
up the Partnership's affairs and shall distribute the Partnership's assets in
the following manner and order:
(a) in satisfaction of the claims of all creditors of the Partnership,
other than the General Partners;
(b) in satisfaction of the claims of the General Partners as creditors of
the Partnership; and
(c) any balance to the Partners in the relative proportions that their
respective Capital Accounts bear to each other, those Capital Accounts to be
determined as if the Fiscal Year ended on the date of the dissolution.
23. Accounting and Reports.
(a) The records and books of account of the Partnership shall be reviewed
as of the end of each Fiscal Year by independent certified public accountants
selected by the General Partners in their sole discretion.
(b) As soon as practicable after the end of each Fiscal Year, the General
Partners shall cause to be delivered to each person who was a Partner at any
time during the Fiscal Year all information deemed necessary by the General
Partners in their sole discretion for the preparation of the Partner's income
tax returns, including a Form 1065/Schedule K-1 statement showing the Partner's
share of Net Profit or Net Loss, deductions and credits for the year for Federal
income tax purposes, and the amount of any distributions made to or for the
account of the Partner pursuant to this Agreement.
(c) The independent certified public accountants selected by the General
Partners in accordance with subsection (a) of this Section 23 shall prepare and
mail to each Partner, within ninety (90) days after the end of each Fiscal Year,
an income statement for the Fiscal Year and a balance sheet as of the end of the
Fiscal Year.
(d) The Partnership shall cause to be prepared and mailed to each Partner a
report setting out as of the end of each Fiscal Quarter information determined
by the General Partners to be appropriate.
(e) The General Partners shall cause tax returns for the Partnership to be
prepared and timely filed with the appropriate authorities.
24. Books and Records.
The General Partners shall keep at the Partnership's principal office:
(a) books and records pertaining to the Partnership's business showing all
of its assets and liabilities, receipts and disbursements, realized profits and
losses, Partners' Capital Accounts and all transactions entered into by the
Partnership;
(b) a current list of the full name and last known home, business or
mailing address of each Partner set out in alphabetical order;
(c) a copy of the Certificate and all amendments to it, together with
executed copies of any powers of attorney pursuant to which the Certificate and
any amendments to it have been executed;
(d) copies of the Partnership's Federal, state and local income tax returns
and reports, if any, for the three (3) most recent years; and
(e) copies of this Agreement as amended from time to time.
All books and records of the Partnership required to be kept under this
Section 24 shall be available for inspection by a Partner of the Partnership on
reasonable notice at the offices of the Partnership during ordinary business
hours for any purpose reasonably related to the Partner's interest as a Partner
in the Partnership.
25. Indemnification.
(a) The Partnership shall indemnify each General Partners and any of his
Affiliates (each an "Indemnitee") to the fullest extent permitted by law and
will hold each harmless from and with respect to (i) all fees, costs and
expenses incurred in connection with, or resulting from, any claim, action or
demand against any Indemnitee that arises out of or in any way relates to the
Partnership, its properties, business or affairs, and (ii) any losses or damages
resulting from any such claim, action or demand, including amounts paid in
settlement or compromise of the claim, action or demand.
(b) No Indemnitee shall be indemnified by the Partnership with respect to
any action or failure to act that does not constitute good faith, or that
constitutes willful misfeasance.
(c) The Partnership may pay the expenses incurred by an Indemnitee in
defending a civil or criminal action, suit or proceeding brought by a party
against the Indemnitee that arises out of or is in any way related to the
Partnership, its properties, business or affairs, upon receipt of an undertaking
by the Indemnitee to repay the amount advanced by the Partnership if an
adjudication or determination is subsequently made by a court of competent
jurisdiction that the Indemnitee is not entitled to indemnification as provided
in this Agreement.
(d) The right of indemnification provided in this Section 25 shall be in
addition to any rights to which an Indemnitee may otherwise be entitled and
shall inure to the benefit of the executors, administrators, personal
representatives, successors or assigns of each Indemnitee.
(e) The rights to indemnification and reimbursement provided for in this
Section 25 may be satisfied only out of the assets of the Partnership. No
Partner shall be personally liable for any claim for indemnification or
reimbursement under this Section 25.
26. Amendment of Partnership Agreement.
This Agreement may be amended, in whole or in part, by the written consent
of (a) the General Partners, and (b) Partners the value of whose aggregate
Capital Accounts constitute not less than fifty percent (50%) of the total value
of all Capital Accounts of the Partnership, provided that no such amendment
shall affect the allocation of Net Profit or Net Loss to any Partner who has not
consented to such amendment. In addition, any provision of this Agreement, other
than Section 9, may be amended by the General Partners in any manner that does
not, in the sole discretion of the General Partners, adversely affect any
Limited Partner.
27. Notices.
Notices that may or are required to be given under this Agreement by any
party to another shall be in writing and deposited in the United States mail,
certified or registered, postage prepaid addressed to the respective parties at
their addresses set out in Schedule A to this Agreement or to any other address
designated by any Partner by notice addressed to the Partnership in the case of
any Limited Partner and to the General Partners in the case of the General
Partners. Notices shall be deemed to have been given when deposited in the
United States mail within the continental United States.
28. Agreement Binding Upon Successors and Assign.
This Agreement shall inure to the benefit of and shall be binding upon the
heirs, executors, administrators or other representatives, successors and
assigns of the Partners.
29. Governing Law.
This Agreement, and the rights of the Partners under it, shall be governed
by and construed in accordance with the law of the State of New Jersey.
30. Consents.
Any and all consents, agreements or approvals provided for or permitted by
this Agreement shall be in writing and signed copies of them shall be filed and
kept with the books of the Partnership.
31. Miscellaneous.
(a) This Agreement, including Schedule A appended to it, constitutes the
entire understanding and Agreement of the Partners as to the operation of the
Partnership.
(b) This Agreement may be executed in counterparts, each of which shall be
deemed to be an original.
(c) Each provision of this Agreement is intended to be severable. A
determination that a particular provision of this Agreement is illegal or
invalid shall not affect the validity of the remainder of the Agreement.
(d) Nothing contained in this Agreement shall be construed to constitute
any Partner the agent of another Partner, except as specifically provided in
this Agreement, or in any manner to limit the Partners in the carrying on of
their own respective business or activities.
(e) If there is a conflict between the terms and conditions of the
Partnership Agreement and Offering Memorandum, the Partnership Agreement shall
be controlling.
IN WITNESS WHEREOF, the Partners have executed this Agreement as of the
date first above written.
GENERAL PARTNER
POLLACK INVESTMENT PARTNERSHIP, L.P.
By: ________________________________
Dennis Pollack
LIMITED PARTNERS:
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 delivered to the
General Partners.
DENNIS POLLACK
Attorney-in-Fact
--------------------
Dennis Pollack
EXHIBIT B
POLLACK INVESTMENT PARTNERSHIP, L.P.
OFFEREE QUESTIONNAIRE
INSTRUCTIONS: All prospective Limited Partners of Pollack Investment
Partnership L.P. (the "Partnership") must complete this Questionnaire. If you
have any questions about this form please telephone Dennis Pollack, the
representative of the General Partner, at (201) 930-1428, or Lawrence B. Seidman
at (973) 560-1400, Extension 108.
This questionnaire is required to insure that the offering of the Partnership's
Limited Partnership Interests complies with SEC rules on private placements. All
information will be kept confidential.
PART I TO BE COMPLETED BY ALL SUBSCRIBERS
1. Name
-----------------------------------------------------
2. Home Address
--------------------------------------------------
Home Telephone Number ( )
---------------------------------
3. Business Address
-------------------------------------
Business Telephone Number ( )
---------------------------
4. Social Security Number
or Employer I.D. Number
-----------------------------
5. If subscriber is a corporation, partnership, trust or other entity,
attach a copy of the Articles of Incorporation, By-Laws, Partnership
Agreement, Trust Instrument, or other documents showing that the entity
is authorized to invest in the Interests and that the individual(s)
signing the Subscription Agreement are authorized to take such action
on behalf of the entity.
PART II
1. Please indicate the basis on which you qualify as an "accredited
investor" for purposes of SEC Regulation D. See Annex B-1 for the types of
"accredited investors " eligible to invest in the Partnership
2. Educational Background - List all schools, beginning with the last high
school attended and indicate years attended, whether graduated, and degrees
received:
3. Business Background - List your principal business occupations during the
past 10 years, indicating name of company, nature of business, and your title
and responsibilities:
4. Investment Background - Indicate whether you have ever invested in any of the
following (give details where possible); include investments for your own
account, as trustee or other fiduciary, or in any business or professional
capacity:
a. Investment partnerships
b. Other limited partnerships
--------------------------
c. Venture capital companies
-------------------------
d. Restricted securities
e. Any other business involving investments
----------------------------------------
f. Any other activity which you believe contributes to your
--------------------------------------------------------
ability to understand and evaluate the merits and risks of an
--------------------------------------------------------------
investment in the Partnership
-----------------------------
PART III THE FOLLOWING QUESTIONS ARE BEING ASKED TO ASSIST THE
PARTNERSHIP TO DETERMINE AND DOCUMENT ITS ELIGIBILITY TO
PURCHASE SECURITIES THAT ARE PART OF A PUBLIC OFFERING AND THAT MAY TRADE AT A
PREMIUM IN THE SECONDARY MARKET AFTER THE OFFERING.
A. TO BE COMPLETED BY "INSTITUTIONAL INVESTORS"
THE FOLLOWING QUESTIONS SHOULD BE ANSWERED TO THE BEST KNOWLEDGE AND BELIEF
OF THE PERSON AUTHORIZED TO ACT FOR THE SUBSCRIBER.
Except as specified below, the Subscriber is not, and, upon information and
belief, all persons having a beneficial interest in the Subscriber are not:
1. a broker/dealer or an officer, director, general partner, employee,
agent, or associated person of any broker/dealer.
2. a senior officer of, or a person in the securities department of, or an
employee or other person who may influence or whose activities directly or
indirectly involve or are related to the function of buying or selling of
securities for:
a. a bank,
b. a savings and loan institution,
c. an insurance company,
d. a registered investment company,
e. a registered investment advisory firm, or
f. any other institutional-type account.
3. a person who acts in a fiduciary capacity (including attorney,
accountant or financial consultant) to any firm which is a managing underwriter
of public offerings.
4. an immediate family member of any person listed above.
B. TO BE COMPLETED BY INDIVIDUAL INVESTORS
Except as specified below, to the best of my knowledge and belief:
1. I am not an officer, director, general partner, employee, agent,
or associated person of any broker/dealer.
2. I am not a senior officer of, or a person in the securities department of,
or an employee or other person who may influence or whose activities
directly or indirectly involve or are related to the function of buying or
selling of securities for:
a. a bank,
b. a savings and loan institution,
c. an insurance company,
d. a registered investment company,
e. a registered investment advisory firm, or
f. any other institutional-type account.
3. I do not act as a finder in connection with public offerings of securities.
4. I do not act in a fiduciary capacity (including attorney, accountant or
financial consultant) to any firm which is a managing underwriter of public
offerings.
5. I am not an immediate family member of any person listed above.
C. TO BE COMPLETED BY BOTH "INSTITUTIONAL"
AND INDIVIDUAL INVESTORS
PLEASE GIVE AN EXPLANATION OF EACH EXCEPTION TO THE
STATEMENTS LISTED ABOVE. IF YOU ARE, OR ANY BENEFICIAL OWNER
OF THE SUBSCRIBER IS KNOWN TO BE, AN IMMEDIATE FAMILY MEMBER
OF A PERSON LISTED IN CATEGORY 1 ABOVE, PLEASE STATE WHETHER
SUCH PERSON CONTRIBUTES DIRECTLY OR INDIRECTLY TO YOUR OR
SUCH BENEFICIAL OWNER'S SUPPORT.
Signature of Subscriber
Date: , 2000
EXHIBIT C
SUBSCRIPTION AGREEMENT
Pollack Investment Partnership, L.P.
44 Blueberry Lane
Woodcliff Lake, NJ 07675
Gentlemen:
1. Subscription. The undersigned ("Subscriber") hereby irrevocably
subscribes for and agrees to acquire a Limited Partnership Interest ("Interest")
in Pollack Investment Partnership, L.P. (the "Partnership") and agrees to make a
contribution to the capital of the Partnership in the amount of
$______________________ in cash, all in accordance with the terms and conditions
of the Agreement of Limited Partnership dated ______ __, 2000 (the "Partnership
Agreement") attached as Exhibit A to the Confidential Private Placement
Memorandum dated June 2000 relating to the Partnership (the "Memorandum"). This
subscription may be rejected by the Partnership in whole or in part.
2. Adoption of Partnership Agreement. The Subscriber hereby adopts, accepts
and agrees to be bound by all terms and provisions of the Partnership Agreement
and to perform all obligations therein imposed upon a Limited Partner. Upon
acceptance of this Subscription by a General Partner on behalf of the
Partnership and payment in full of the subscription price, the Subscriber shall
become a Limited Partner for all purposes of the Partnership Agreement.
3. Representations and Warranties. The Subscriber hereby represents and
warrants to the Partnership that:
(a) if the Subscriber is an individual he or she, is not less than
twenty-one (21) years of age; if the Subscriber is an entity this Subscription
Agreement is signed on behalf of the Subscriber by an authorized person who is
not less than twenty-one (21) years of age;
(b) the Interest subscribed for hereby is being acquired by the Subscriber
for investment purposes only, for the account of the subscriber and not with the
view to any resale or distribution thereof, and the Subscriber is not
participating, directly or indirectly, in an underwriting of such Interest and
will not take, or cause to be taken, any action that would cause the Subscriber
to be deemed an "underwriter" of such Interest as defined in Section 2(11) of
the Securities Act of 1933, as amended;
(c) the Subscriber has received and has carefully read a copy of the
Memorandum, including the Partnership Agreement and other Exhibits thereto, and,
in connection therewith, has had access to all other materials, books, records,
documents and information relating to the Partnership, and has been able to
verify the accuracy of and supplement the information contained therein;
(d) the Subscriber acknowledges that he or it has been offered an
opportunity to ask questions of, and receive answers from Lawrence B. Seidman,
the representatives of the General Partner, concerning the Partnership and
Dennis Pollack and/or its proposed business, and that any request for such
information has been fully complied with by them;
(e) the Subscriber (if an individual) or the person signing this
Subscription Agreement on behalf of the Subscriber (if it is an entity) has such
knowledge and experience in financial and business matters that the Subscriber
is capable of evaluating the merits and risks of an investment in the
Partnership, and the Subscriber is able to bear the economic risks of an
investment in the Partnership;
(f) the Subscriber has adequate means of providing for the current needs of
the Subscriber and possible personal contingencies, and the Subscriber has no
need for liquidity with respect to the investment of the Subscriber in the
Partnership;
(g) the Subscriber has been advised that an investment in the Partnership
is highly speculative, and the Subscriber is able to bear the economic risk of
an investment in the Partnership;
(h) the Offeree Questionnaire furnished by the Subscriber to the
Partnership is true and accurate as of the date hereof; and
(i) if the Subscriber is an entity, it is authorized and otherwise duly
qualified to acquire an Interest in the Partnership.
4. Restrictions on Transferability of Interests. The Subscriber realizes
that the Interests are not, and will not be, registered under the Securities Act
of 1933, as amended (the "Act"), and that the Partnership does not file and does
not intend to file periodic reports with the Securities and Exchange Commission
pursuant to the requirements of Sections 13 or 15(d) of the Securities Exchange
Act of 1934, as amended. The Subscriber also understands that the Partnership
has not agreed to register the Interests for distribution in accordance with the
provisions of the Act or any applicable state securities laws, and that the
Partnership has not agreed to comply with any exemption under the Act or any
such laws for the resale of the Interests. Hence, the Subscriber understands
that by virtue of the provisions of certain rules relating to "restricted
securities" promulgated under the act, the Interest which the Subscriber has
subscribed for hereby must be held indefinitely, unless and until subsequently
registered under the Act and/or applicable state securities laws or unless an
exemption from registration is available, in which case the Subscriber may still
be limited with respect to the extent to which such Interest may be transferred.
5. Power of Attorney. The Subscriber hereby makes, constitutes and appoints
Dennis Pollack and Lawrence B. Seidman, and each of them, with power of
substitution, as the true and lawful Attorney-in-Fact of the Subscriber, in
whose name, place and stead to make, execute, sign, acknowledge and file with
respect to the Partnership:
(a) the Partnership Agreement;
(b) a Certificate or amended Certificate of Limited Partnership under
the laws of the State of New Jersey, including therein all information
therein all information required by the laws of such state;
(c) all instruments which said Attorney-in-Fact deems appropriate to
reflect any amendment, change or modification of the Partnership in
accordance with the terms of the Partnership Agreement;
(d) all such other instruments, documents and certificates which may
from time to time be required by the laws of the State of New Jersey, the
United States of America, or any other jurisdiction in which the
Partnership shall determine to do business, or any political subdivision or
agency thereof, to effectuate, implement, continue and defend the valid and
subsisting existence of the Partnership as a Limited Partnership.
(e) all applications, certificates, certifications, reports or similar
instruments or documents required to be submitted by or on behalf of the
Partnership to any governmental or administrative agency or body or to any
securities or commodities, exchange, board of trade, clearing corporation
or association or similar institution or to any other self-regulatory
organization or trade association; and
(f) all papers which may be deemed necessary or desirable by said
Attorney-in-Fact to effect the dissolution and liquidation of the
Partnership; provided, however, that such Attorney-in-Fact shall not have
any right, power or authority to amend or modify the Partnership Agreement
when acting in such capacity. The admission or termination of the interest
of any Partner in accordance with the terms of the Partnership Agreement
shall not constitute an amendment thereof. The foregoing Power of Attorney
is hereby declared to be irrevocable and to constitute a power coupled with
an interest, and it shall survive the death or adjudicated incompetence of
the Subscriber and extend to the Subscriber's heirs, legal representatives,
successors and assignees. The Subscriber hereby agrees to be bound by any
representation made by such Attorney-in-Fact acting in good faith pursuant
to such Power of Attorney, and the Subscriber hereby waives any and all
defenses which may be available to contest, negate or disaffirm the action
of such Attorney-in-Fact taken in good faith pursuant to such Power of
Attorney.
6. Payment of Subscription. Enclosed herewith is a certified or
official bank check payable to the order of the Partnership for the full
amount of this subscription. The Subscriber recognizes that if this
subscription is rejected, in whole or in part, the funds and instruments
delivered herewith, to the extent this subscription has been rejected, will
be returned to the Subscriber without interest as soon as practicable.
7. Non-Revocability. The Subscriber agrees that this Subscription
Agreement may not be canceled, terminated or revoked, and that this
Subscription Agreement and the Power of Attorney granted hereby are coupled
with an interest and shall survive the death or disability of the
Subscriber and shall be binding upon the heirs, executors, administrators,
successors, and assignees of the Subscriber.
8. Notice. Any notices or other communications in connection herewith
shall be sufficiently given if sent by registered or certified mail,
postage prepaid, and (i) if to the Partnership, at the address at the head
of this Subscription Agreement, and (ii) if to the Subscriber, at the
address set forth below, or (iii) at such other address as either the
Subscriber or the Partnership shall designate to the other by notice in
writing.
9. Successors and Assignees. This Subscription Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and to
the successors and assignees of the Partnership and to the personal and
legal representatives, heirs, guardians, successors and permitted assignees
of the Subscriber.
10. Applicable Law. This Subscription Agreement shall be governed by
and construed in accordance with the laws of the State of New Jersey and,
to the extent it involves any United States statute, in accordance with the
laws of the United States.
IN WITNESS WHEREOF, the undersigned has executed and sealed this
Subscription Agreement, this __ day of _______, 2000
------------------------
Name of Subscriber
------------------------
Signature of Subscriber
------------------------
Residence Address
------------------------
City, State and Zip Code
------------------------
Social Security or Tax
Identification Number
Accepted:
Pollack Investment Partnership, L.P.
By: ------------------------
Dennis Pollack
[Individual Acknowledgment]
State of )
)SS:
County of )
On the day of , 2000, before me personally came to me known and known
to me to be the individual described in and who executed the foregoing
instrument, and (s)he duly acknowledged to me that (s)he executed the same.
------------------------
Notary Public
[Corporate Acknowledgment
State of )
)SS:
County of )
On the day of , 2000, before me personally came , to me known, who,
being by me sworn, did depose and say that (s)he resides in , that (s)he is
the of , the corporation described in and which executed the above
instrument; and that (s)he signed such instrument by order of the board of
directors of said corporation.
------------------------
Notary Public
[Partnership Acknowledgment]
State of )
)SS:
County of )
On the day of , 1999, before me personally came , who, being by me
sworn, did depose and say that (s)he resides in , that (s)he is a general
partner of , the partnership described in and who executed the above
instrument, and (s)he is duly authorized to do so in the name of, and on
behalf of, said partnership.
------------------------
Notary Public
[Trust Acknowledgment]
State of )
)SS:
County of )
On the day of , 1999, before me personally came , trustee under , to
me personally known and known to me to be the individual described in and
who executed the foregoing instrument, and (s)he duly acknowledged to me
that (s)he executed the same.
------------------------
Notary Public
AMENDMENT #1
TO LIMITED PARTNERSHIP
AMENDMENT #1
TO LIMITED PARTNERSHIP
CERTIFICATE OF
POLLACK INVESTMENT PARTNERSHIP, L.P.
FILED DECEMBER 6, 2000
Section 1 The name of the Partnership is Pollack Investment
Partnership, L.P.
Statutory Authority for Amendment: 42:2A
Section 12 Section 12 of the Certificate of formation of the
above-referenced business is hereby amended to add
the following people and entities as limited partners:
NAME CAPITAL CONTRIBUTION
William C. Kockler IRA $100,000.00
22291 Westchester Blvd.
Unit 506H Orangewood Commons
Port Charlotte, FL 33952
Thomas D. Cunningham IRA $100,000.00
8 Nearwater Rd.
Rowayton, CT 06853
Amos Linenberg IRA $115,000.00
9 Powder Horn Green
Sparta, NJ 07657
Elaine Berkley $100,000.00
89 Woodmont Dr. 10580
Woodcliff Lake, NJ 07675
Howard Silston $ 100,000.00
2030 So. Ocean Drive
Apt. 1808
Hallandale, FL 33009
Pamela Jones $ 100,000.00
8 Nearwater Rd.
Rowayton, CT 06853
George Saunders $ 100,000.00
c/o Frank Boffa, CPA
383 Ridgedale Avenue
East Hanover, NJ 07936
Dorothy Sheppard $ 200,000.00
23 East 10th Street
Suite 615
New York, NY 10003
James Rotundo $ 200,000.00
65 West Edsall Blvd.
Palisades Park, NJ 07650
POLLACK INVESTMENT PARTNERSHIP, L.P.
By:
Dennis Pollack, General Partner
POLLACK INVESTMENT PARTNERSHIP, L.P.
By:
Lawrence B. Seidman, General Partner
Dated: January 25, 2001
STATE OF NEW JERSEY )
) ss:
COUNTY OF MORRIS )
On the 25th day of January 2001, before me personally came Dennis Pollack
and Lawrence B. Seidman, to me known, who being by me sworn, did depose and say
that they reside at 47 Blueberry Drive, Woodcliff Lake, NJ 07675 and 19 Veteri
Place, Wayne, New Jersey 07470, respectively, that they are the General Partners
of Pollack Investment Partnership, L.P. described in and which executed the
above instrument.
//Ruth W. Rivkind//
Ruth W. Rivkind
A Notary Public of New Jersey
My Commission Expires Feb. 14, 2001
EX-10.9
11
exiii.txt
JOINT FILING AGREEMENT
EXHIBIT I
JOINT FILING AGREEMENT
In accordance with Rule 13d-1(f) under the Securities Exchange Act of 1934,
as amended, the undersigned hereby agree to the joint filing with each other of
the attached statement on Schedule 13D and to all amendments to such statement
and that such Statement and all amendments to such statement is made on behalf
of each of them.
In addition the undersigned hereby appoints Lawrence B. Seidman as
attorney-in-fact for the undersigned with authority to execute and deliver on
behalf of the undersigned any and all documents (including any amendments
thereto) required to be filed by the undersigned or otherwise executed and
delivered by the undersigned pursuant to the Securities Exchange Act of 1934, as
amended, all other federal, state and local securities and corporation laws, and
all regulations promulgated thereunder.
IN WITNESS WHEREOF, the undersigned hereby execute this agreement on
September 28, 2001.
9/28/01 /ss/Lawrence B. Seidman
------ ------------------------------
Date Lawrence B. Seidman, Manager
Seidman and Associates, L.L.C.
9/28/01 /ss/Lawrence B. Seidman
------ ------------------------------
Date Lawrence B. Seidman, President
of the Corporate General Partner
Seidman Investment Partnership,L.P.
9/28/01 /ss/Lawrence B. Seidman
------ ------------------------------
Date Lawrence B. Seidman, President
of the Corporate General Partner
Seidman Investment Partnership II,
L.P.
9/28/01 /ss/Lawrence B. Seidman
------ ------------------------------
Date Lawrence B. Seidman, Individually
9/28/01 /ss/Lawrence B. Seidman
------ ------------------------------
Date Lawrence B. Seidman, Investment
Manager, Kerrimatt, L.P.
9/28/01 /ss/Lawrence B. Seidman
------ ------------------------------
Date Lawrence B. Seidman, Investment
Manager
Federal Holdings, L.L.C.
9/28/01 /ss/Lawrence B. Seidman
------ ------------------------------
Date Lawrence B. Seidman, Co-General
Partner, Pollack Investment
Partnership, L.P.
9/28/01 /ss/Dennis Pollack
------ ------------------------------
Date Dennis Pollack, Individually
9/28/01 /ss/Dennis Pollack
------ ------------------------------
Date Dennis Pollack, Co-General
Partner, Pollack Investment
Partnership, L.P.