Ex 10.33
AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
OF
TRIDENT III ESC, L.P.
(A Cayman Islands Exempted Limited Partnership)
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LIMITED PARTNER INTERESTS IN TRIDENT III ESC, L.P. ARE SUBJECT TO RESTRICTIONS
ON TRANSFERABILITY. THEY MAY NOT BE TRANSFERRED WITHOUT THE CONSENT OF THE
GENERAL PARTNER OF TRIDENT III ESC, L.P. AND EXCEPT AS PERMITTED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND ALL OTHER APPLICABLE LAWS. INVESTORS
WILL BE REQUIRED TO BEAR THE FINANCIAL RISKS OF AN INVESTMENT IN TRIDENT III
ESC, L.P. FOR AN INDEFINITE PERIOD OF TIME.
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TABLE OF CONTENTS
SECTION PAGE
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SECTION 1 ORGANIZATION, ETC......................................................................1
1.1 Amendment and Restatement of the Initial Agreement; Admission of Limited Partners...............1
1.2 Name and Offices................................................................................1
1.3 Purposes........................................................................................2
1.4 Term............................................................................................2
1.5 Fiscal Year.....................................................................................2
1.6 Partnership Powers..............................................................................2
SECTION 2 THE GENERAL PARTNER....................................................................3
2.1 Management......................................................................................3
2.2 Limitations on the General Partner..............................................................4
2.3 Reliance by Third Parties.......................................................................4
2.4 Fees and Expenses...............................................................................4
2.5 Conflicts of Interest...........................................................................5
2.6 Liability of the General Partner and the Manager................................................6
SECTION 3 LIMITED PARTNERS.......................................................................7
3.1 Eligibility.....................................................................................7
3.2 No Participation in Management, etc.............................................................7
3.3 Limitation of Liability.........................................................................7
3.4 No Priority, etc................................................................................7
3.5 Further Actions of the Limited Partners.........................................................7
SECTION 4 INVESTMENTS............................................................................8
4.1 Investments in Portfolio Companies..............................................................8
4.2 Special Investment Vehicle; Blocker Structures..................................................8
4.3 Temporary Investments...........................................................................9
SECTION 5 CAPITAL CONTRIBUTIONS AND CAPITAL COMMITMENTS..........................................9
5.1 Capital Contributions and Capital Commitments of the Partners...................................9
5.2 Defaulting Partner.............................................................................10
5.3 Further Actions................................................................................11
5.4 Excused Investments............................................................................11
SECTION 6 CAPITAL ACCOUNTS; DISTRIBUTIONS.......................................................11
6.1 Capital Accounts...............................................................................11
6.2 Adjustments to Capital Accounts................................................................11
6.3 Distributions..................................................................................11
6.4 Overriding Provision...........................................................................11
6.5 Distributions in Kind..........................................................................12
6.6 Negative Capital Accounts......................................................................12
6.7 No Withdrawal of Capital.......................................................................12
6.8 Allocations....................................................................................12
6.9 Tax Matters....................................................................................12
6.10 Withholding Taxes..............................................................................13
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TABLE OF CONTENTS
(continued)
SECTION PAGE
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6.11 Final Distribution.............................................................................15
SECTION 7 THE MANAGER...........................................................................15
SECTION 8 BANKING, CUSTODY OF SECURITIES, ACCOUNTING, BOOKS AND RECORDS, ADMINISTRATIVE
SERVICES .............................................................................15
8.1 Banking; Custody of Securities.................................................................15
8.2 Maintenance of Books and Records; Access.......................................................16
8.3 Partnership Tax Returns........................................................................16
SECTION 9 REPORTS TO PARTNERS, ANNUAL MEETING, VALUATIONS.......................................16
9.1 Independent Auditors...........................................................................16
9.2 Partnership Reports to Limited Partners........................................................17
9.3 United States Federal Income Tax Information...................................................17
9.4 Annual Meeting.................................................................................17
9.5 Valuation......................................................................................17
SECTION 10 INDEMNIFICATION.......................................................................18
10.1 Indemnification of Covered Persons.............................................................18
10.2 Expenses, etc..................................................................................19
10.3 Notices of Claims, etc.........................................................................19
10.4 No Waiver......................................................................................20
10.5 Covered Persons May Rely and Enforce...........................................................20
SECTION 11 TRANSFERS, REdemptions AND WITHDRAWALS................................................20
11.1 General Restrictions on Transfers and Withdrawals; Material Adverse Effects; Regulatory
Redemptions....................................................................................20
11.2 Additional Limited Partners....................................................................21
11.3 Multi-Fund and Multi-Vehicle Adjustments.......................................................23
11.4 Effect of Termination of Employment............................................................24
11.5 Transfer or Withdrawal by the General Partner..................................................25
SECTION 12 DEATH, INCOMPETENCY OR BANKRUPTCY OR DISSOLUTION OF PARTNERS..........................26
12.1 Bankruptcy or Dissolution of the General Partner...............................................26
12.2 Death, Incompetence, Bankruptcy, Dissolution or Withdrawal of a Limited Partner................26
SECTION 13 DISSOLUTION AND TERMINATION OF PARTNERSHIP............................................26
13.1 Dissolution....................................................................................26
13.2 Distribution Upon Dissolution..................................................................27
13.3 Distributions in Cash or in Kind...............................................................28
13.4 Time for Liquidation, etc......................................................................28
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TABLE OF CONTENTS
(continued)
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13.5 General Partner and Members of MMC Not Personally Liable for Return of Capital Contributions...28
13.6 Reorganization of the Partnership..............................................................29
SECTION 14 DEFINITIONS...........................................................................31
SECTION 15 AMENDMENTS............................................................................37
SECTION 16 MISCELLANEOUS PROVISIONS..............................................................37
16.1 Notices........................................................................................37
16.2 Counterparts...................................................................................38
16.3 Table of Contents and Headings.................................................................38
16.4 Successors and Assigns.........................................................................38
16.5 Severability...................................................................................38
16.6 Non-Waiver.....................................................................................38
16.7 Applicable Law (Submission to Jurisdiction)....................................................39
16.8 Confidentiality................................................................................39
16.9 Survival of Certain Provisions.................................................................39
16.10 Waiver of Partition............................................................................40
16.11 Currency.......................................................................................40
16.12 Entire Agreement...............................................................................40
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This Amended and Restated Limited Partnership Agreement (as from time
to time amended, restated, supplemented or otherwise modified, this "AGREEMENT")
of TRIDENT III ESC, L.P., a Cayman Islands exempted limited partnership (the
"PARTNERSHIP"), is made and entered into on December 12, 2003 for the purpose of
amending and restating the initial Limited Partnership Agreement of the
Partnership, dated __________ __, 2003 (the "INITIAL AGREEMENT"). Capitalized
terms used herein without definition have the meanings specified in Section 14.
SECTION 1
ORGANIZATION, ETC.
1.1 AMENDMENT AND RESTATEMENT OF THE INITIAL AGREEMENT; ADMISSION OF
LIMITED PARTNERS. The General Partner, the Initial Limited Partner and the
Persons listed in the records of the Partnership as limited partners of the
Partnership (such Persons, in their capacities as limited partners of the
Partnership, the "LIMITED PARTNERS" and, together with the General Partner, the
"PARTNERS", both such terms to include any Person hereafter admitted as a
Partner in accordance with the terms hereof, and to exclude any Person that
ceases to be a Partner in accordance with the terms hereof), hereby amend and
restate the Initial Agreement in its entirety by deleting it and replacing it
with this Agreement. A Person shall be admitted as a limited partner of the
Partnership at the time that this Agreement and a Subscription Agreement are
executed by or on behalf of such Person and accepted by the General Partner. Any
such admission shall be listed by the General Partner in the register of
partnership interests of the Partnership maintained at its registered office.
Upon the admission of the first Limited Partner to the Partnership, the Initial
Limited Partner shall cease to be a partner of the Partnership and the
Partnership shall return the original capital contribution made by the Initial
Limited Partner, who shall have no further rights or claims against, or
obligations as a partner of, the Partnership.
1.2 NAME AND OFFICES. The name of the Partnership is Trident III ESC,
L.P. The Partnership shall have its registered office in the Cayman Islands at
the offices of Walkers SPV Limited, Xxxxxxx Xxxxx, Xxxx Xxxxxx, X.X. Xxx 000 GT,
Xxxxxx Town, Grand Cayman, Cayman Islands, at which shall be kept the records
required to be maintained under the Partnership Law, at which the service of
process on the Partnership may be made and to which all notices and
communications may be addressed. The General Partner may designate from time to
time another office in the Cayman Islands as the Partnership's registered
office. The General Partner may from time to time maintain one or more other
offices within or without the United States. The Partnership may from time to
time have such other office or offices within or without the Cayman Islands as
may be designated by the General Partner.
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1.3 PURPOSES. Subject to the other provisions of this Agreement, the
purposes and business of the Partnership are to co-invest (and, in connection
with such co-investments, to acquire, hold, manage and Transfer Securities) with
Trident III, L.P., a Cayman Islands exempted limited partnership (the
"INSTITUTIONAL FUND", and, together with any other investment funds and separate
accounts organized and/or managed by MMC or its Affiliates and authorized to
co-invest with the Institutional Fund, the "PARALLEL FUNDS"), and to engage in
such other activities as the General Partner deems necessary, advisable,
convenient or incidental thereto, to engage in any business which may lawfully
be conducted by a limited partnership formed pursuant to the Partnership Law,
and to carry on any activities relating thereto or arising therefrom, including
anything incidental, ancillary or necessary to the foregoing, PROVIDED that the
Partnership shall not undertake business with the public in the Cayman Islands
other than so far as may be necessary for the carrying on of the activities of
the Partnership exterior to the Cayman Islands.
1.4 TERM. The term of the Partnership commenced on the date set forth
in the statement (as it may be amended from time to time, the "STATEMENT")
effecting its registration as an exempted limited partnership pursuant to
Section 9 of the Partnership Law and shall continue, unless the Partnership is
sooner dissolved, until the end of the term of the Institutional Fund, including
as such term is extended pursuant to the Institutional Fund Agreement (such term
of the Partnership, as so extended, being referred to as the "TERM"), PROVIDED,
that the General Partner in its sole discretion may extend such Term
Notwithstanding the expiration of the Term, the Partnership shall continue until
notice of dissolution of the Partnership is filed in accordance with Section
13.4 and in the manner provided in the Partnership Law.
1.5 FISCAL YEAR. The Fiscal Year of the Partnership shall end on the
31st day of December in each year. The Partnership shall have the same Fiscal
Year for income tax and for financial and partnership accounting purposes.
1.6 PARTNERSHIP POWERS. In furtherance of the purposes specified in
Section 1.3 and without limiting the generality of Section 2.1, the Partnership
and the General Partner, acting on behalf of the Partnership or on its own
behalf and in its own name, as appropriate, shall be empowered to do or cause to
be done any and all acts deemed by the General Partner, in its sole discretion,
to be necessary, advisable, appropriate, proper, convenient or incidental to or
for the furtherance of the purposes of the Partnership including, without
limitation, the power and authority:
(a) to acquire, hold, manage and Transfer Securities or any
other investments made or other property or assets held by the
Partnership;
(b) to establish, have, maintain or close one or more offices
within or without the Cayman Islands and in connection therewith to
rent or acquire office space and to engage personnel;
(c) to open, maintain and close bank and brokerage (including,
without limitation, margin) accounts, including, without limitation, to
draw
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checks or other orders for the payment of moneys, to exchange U.S.
dollars held by the Partnership into non-U.S. currencies and vice
versa, to enter into currency forward and futures contracts, to hedge
Portfolio Investments, and to invest such funds as are temporarily not
otherwise required for Partnership purposes in Temporary Investments;
(d) to bring, defend, settle and dispose of actions,
Proceedings at law or in equity or before any Governmental Authority;
(e) to retain and remove consultants, custodians, attorneys,
placement agents, accountants, actuaries and such other agents and
employees of the Partnership as it may deem necessary or advisable, and
to authorize each such agent and employee to act for and on behalf of
the Partnership;
(f) to retain the Manager as contemplated by Section 7 to
render investment advisory and managerial services to the Partnership;
(g) to execute, deliver and perform its obligations under the
Subscription Agreements and any agreements to induce any Person to
purchase limited partner interests in the Partnership, without any
further act, approval or vote of any Partner;
(h) to make all elections, investigations, evaluations and
decisions, binding the Partnership thereby, that may, in the sole
discretion of the General Partner, be necessary, appropriate, desirable
or convenient for the acquisition, holding or disposition of Securities
for the Partnership;
(i) to enter into, deliver, perform and carry out contracts
and agreements of every kind necessary or incidental to the offer and
sale of limited partner interests in the Partnership, to the
acquisition, holding and Transfer of Securities, or otherwise, to the
accomplishment of the Partnership's purposes, and to take or omit to
take such other action in connection with such offer and sale, with
such acquisition, holding or Transfer, or with the business of the
Partnership as may be necessary, desirable or convenient to further the
purposes of the Partnership;
(j) to borrow money and to issue guarantees; and
(k) to carry on any other activities necessary to, in
connection with, or incidental to any of the foregoing or the
Partnership's business.
SECTION 2
THE GENERAL PARTNER
2.1 MANAGEMENT. The management, control and operation of and the
determination of policy with respect to the Partnership and its affairs shall be
vested exclusively in the General Partner (acting directly or through its duly
appointed agents),
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which is hereby authorized and empowered on behalf and in the name of the
Partnership, subject to Section 2.2 and the other terms of this Agreement, to
carry out any and all of the objects and purposes of the Partnership and to
perform all acts and enter into and perform all contracts and other undertakings
that it may in its sole discretion deem necessary, advisable, convenient or
incidental thereto. The General Partner may exercise on behalf of the
Partnership, and may delegate to the Manager, all of the powers set forth in
Section 1.6, PROVIDED, that the management and the conduct of the activities of
the Partnership shall remain the sole responsibility of the General Partner and
all decisions relating to the selection and disposition of the Partnership's
investments shall be made exclusively by the General Partner in accordance with
this Agreement. The General Partner is hereby authorized to appoint a successor
general partner.
2.2 LIMITATIONS ON THE GENERAL PARTNER. The General Partner shall not:
(a) do any act in contravention of any applicable law or
regulation, or any provision of this Agreement or of the Statement;
(b) possess Partnership property for other than a Partnership
purpose;
(c) admit any Person as a general partner of the Partnership
except as permitted by this Agreement and the Partnership Law;
(d) admit any Person as a Limited Partner except as permitted
by this Agreement and the Partnership Law;
(e) Transfer its interest in the Partnership except as
permitted by this Agreement and the Partnership Law; or
(f) permit the registration or listing of interests in the
Partnership on an "established securities market," as such term is used
in Treasury Regulations section 1.7704-1.
2.3 RELIANCE BY THIRD PARTIES. In dealing with the General Partner and
its duly appointed agents (including, without limitation, the Manager), no
Person shall be required to inquire as to the General Partner's or any such
agent's authority to bind the Partnership.
2.4 FEES AND EXPENSES. (a) The Partnership shall not pay any management
fee, carried interest or other similar fee or performance incentive to the
General Partner, the Manager, MMC or any of their respective Affiliates.
(b) All expenses relating to the organization of the
Partnership shall be paid by the Partnership and shall be allocated to
all Partners in proportion to their Capital Commitments.
(c) The Partnership shall pay its PRO RATA share of actual
out-of-pocket expenses of investigating potential investment
opportunities and monitoring portfolio companies, such as travel,
legal, auditing, consulting, accounting,
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actuarial and other professional fees or third-party expenses, in all
cases to the extent not reimbursed by others. The Partnership shall pay
all extraordinary expenses (such as litigation) and all costs and
expenses relating to the Partnership's activities, including, but not
limited to, legal, auditing, consulting, accounting, tax preparation,
custodial fees and costs of reports to and meetings of the Partners.
2.5 CONFLICTS OF INTEREST. (a) GENERAL. While the General Partner and
the Manager intend to avoid situations involving conflicts of interest, each
Limited Partner acknowledges that there may be situations in which the interests
of the Partnership, with respect to a Portfolio Company or otherwise, may
conflict with the interests of the General Partner, the Manager or their
respective Affiliates. Each Limited Partner agrees that the activities of the
General Partner, the Manager and their respective Affiliates specifically
authorized by or described in this Agreement or the Memorandum may be engaged in
by the General Partner, the Manager or any such Affiliate, as the case may be,
and shall not, in any case or in the aggregate, be deemed a breach of this
Agreement or any duty owed by any such Person to the Partnership or any Partner.
On any issue involving an actual conflict of interest not provided for elsewhere
in this Agreement, each of the General Partner and the Manager shall take such
actions as are determined in good faith by the Manager or the General Partner,
as the case may be, to be necessary or appropriate to ameliorate any such
conflict of interest.
(b) OTHER FUNDS. MMC, the General Partner, the Manager and any
of their respective Affiliates may organize, sponsor or manage private
investment funds and separate accounts in addition to the Partnership
(such funds and accounts, including any Parallel Funds, the "OTHER
FUNDS"), including Other Funds having primary investment objectives and
policies substantially the same as those of the Partnership. Investment
opportunities suitable for the Partnership shall be allocated among the
Partnership and the Other Funds by the general partner of the
Institutional Fund. The agreements governing the Other Funds may
include restrictions on activities of MMC or its Affiliates that would
otherwise be permitted under this Section 2.5, or may subject such
activities to conditions. The General Partner shall afford the
Partnership the benefits of any such restrictions or conditions to the
extent it deems appropriate.
(c) CERTAIN CONTRACTS. Subject to the other provisions of this
Agreement, the General Partner or the Manager may cause the Partnership
to enter into contracts and transactions with MMC or any of its
Affiliates (including the Manager), PROVIDED that the General Partner
shall have determined in good faith that the terms of any such contract
or transaction are commercially reasonable to the Partnership.
(d) OTHER RESTRICTIONS. Notwithstanding any other provision of
this Agreement, the Partnership's investment activities shall at all
times be conducted in accordance with the conditions of any order under
Section 6(b) of the Investment Company Act that is from time to time
applicable to the Partnership. Each proposed transaction involving the
Partnership otherwise prohibited by
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Section 17(a) or Section 17(d) of the Investment Company Act and Rule
17d-1 thereunder (the "SECTION 17 TRANSACTIONS") shall be effected only
if the General Partner makes such determinations as are required by any
such order. The General Partner shall record and preserve a description
of each Section 17 Transaction, its findings, the information or
materials upon which its findings are based and the basis therefor. All
such records shall be maintained for the life of the Partnership and at
least two years thereafter. In connection with Section 17 Transactions,
the General Partner shall adopt, and periodically review and update,
procedures designed to ensure that reasonable inquiry is made, prior to
the consummation of any such transaction, with respect to the possible
involvement in the transaction of any affiliated person or promoter of
the Partnership, or any affiliated person of such a person or promoter.
In any case where purchases or sales are made from or to an entity
affiliated with the Partnership by reason of a 5% or more investment in
such entity by a director, officer or employee of MMC, such individual
shall not participate in the General Partner's determination of whether
or not to effect such purchase or sale.
2.6 LIABILITY OF THE GENERAL PARTNER AND THE MANAGER. (a) Except as
otherwise provided in the Partnership Law, the General Partner has the
liabilities of a partner in a partnership without limited partners to (i)
subject to the other provisions of this Agreement, the Partnership and the other
Partners and (ii) Persons other than the Partnership and the other Partners. No
Covered Person shall be liable to the Partnership or any Partner for any act or
omission taken or suffered by any such Covered Person in good faith. No Partner
shall be liable to the Partnership or any Partner for any action taken by any
other Partner. To the extent that, at law or in equity, a Covered Person has
duties and liabilities to the Partnership or to the Partners, such Covered
Person acting under this Agreement or otherwise shall not be liable to the
Partnership or any Partner for its good faith reliance on the provisions of this
Agreement. The provisions of this Agreement, to the extent that they expressly
restrict, replace or modify the duties and liabilities of a Covered Person
otherwise existing at law or in equity, are agreed by the Partners to restrict,
replace or modify such other duties and liabilities of such Covered Person.
(b) RELIANCE. A Covered Person shall incur no liability in
acting upon any signature or writing believed by such Covered Person to
be genuine, may rely on a certificate signed by an officer of any
Person in order to ascertain any fact with respect to such Person or
within such Person's knowledge and may rely on an opinion of counsel
selected by such Covered Person with respect to legal matters. Each
Covered Person may act directly or through its agents or attorneys.
Each Covered Person may consult with counsel, appraisers, engineers,
accountants, actuaries, auditors and other skilled Persons of its
choosing, and shall not be liable for anything done, suffered or
omitted in good faith reliance upon the advice of any of such Persons.
No Covered Person shall be liable to the Partnership or any Partner for
any error of judgment made in good faith by a responsible officer or
officers of such Covered Person. Except as otherwise provided in this
Section 2.6, no Covered Person shall be liable to the Partnership or
any Partner for any mistake of fact or judgment by such Covered Person
in
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conducting the affairs of the Partnership or otherwise acting in
respect of and within the scope of this Agreement.
(c) DISCRETION. Whenever in this Agreement the General Partner
or the Manager is permitted or required to make a decision (i) in its
"sole discretion" or "discretion" or under a grant of similar authority
or latitude, the General Partner or the Manager, as the case may be,
shall be entitled to consider only such interests and factors as it
deems appropriate, including, without limitation, its interests, or
(ii) in its "good faith" or under another expressed standard, the
General -- Partner or the Manager, as the case may be, shall act under
such express standard and shall not be subject to any other or
different standard imposed by this Agreement or any other agreement or
by relevant provisions of law or in equity or otherwise. If any
questions should arise with respect to the operation of the
Partnership, which are not specifically provided for in this Agreement
or the Partnership Law, or with respect to the interpretation of this
Agreement, the General Partner is hereby authorized to make a final
determination with respect to any such question and to interpret this
Agreement in good faith, and its determination and interpretation so
made shall be final and binding on all parties.
SECTION 3
LIMITED PARTNERS
3.1 ELIGIBILITY. Each Limited Partner (other than MMC and its
Affiliates) must, as a condition of partnership, qualify as an Eligible Employee
(as determined by the General Partner in its sole discretion).
3.2 NO PARTICIPATION IN MANAGEMENT, ETC. No Limited Partner, in its
capacity as a limited partner of the Partnership, shall take part in the
management or control of the Partnership's affairs, transact any business in the
Partnership's name or have the power to sign documents for or otherwise bind the
Partnership. No Limited Partner shall have the right to vote for the election,
removal or replacement of the General Partner, except that, upon an event
causing the immediate dissolution of the Partnership pursuant to Section 15 of
the Partnership Law or Section 13.1 of this Agreement, the Limited Partners may
vote to unanimously elect one or more new general partners of the Partnership
pursuant to Section 15 of the Partnership Law.
3.3 LIMITATION OF LIABILITY. Except as may otherwise be provided herein
or by the Partnership Law, the liability of each Limited Partner is limited to
its Capital Commitment.
3.4 NO PRIORITY, ETC. No Limited Partner shall have priority over any
other Limited Partner either as to the return of the amount of its Capital
Contribution to the Partnership, or as to any allocation of income, gain,
deduction or loss.
3.5 FURTHER ACTIONS OF THE LIMITED PARTNERS. Each Limited Partner shall
execute and deliver such other certificates, agreements and documents, and take
such
7
other actions, as may reasonably be requested by the General Partner in
connection with the formation of the Partnership and the achievement of its
purposes, including, without limitation, (A) any documents that the General
Partner deems necessary or appropriate to form, qualify or continue the
Partnership as a limited partnership in all jurisdictions in which the
Partnership has an office or conducts or plans to conduct business and (B) all
such agreements, certificates, tax statements and other documents as may be
required to be filed in respect of the Partnership.
SECTION 4
INVESTMENTS
4.1 INVESTMENTS IN PORTFOLIO COMPANIES. (a) GENERAL. The Partnership
shall co-invest (and, in connection with such co-investments, acquire, hold,
manage and Transfer Securities) with the Parallel Funds to the extent and in the
manner determined by the general partner of the Institutional Fund pursuant to
the Institutional Fund Agreement, PROVIDED that in all instances the Partnership
shall co-invest with the Parallel Funds PRO RATA (allowing for rounding) on the
basis of committed capital in the same class or classes of Securities acquired
by the Parallel Funds on the same terms and at the same time as the Parallel
Funds, except that the Partnership may purchase from the Parallel Funds its PRO
RATA share of any portfolio investment acquired by the Parallel Funds prior to a
Closing Date at the acquisition cost to the Parallel Funds, plus interest
(calculated from the date the Parallel Funds acquired such investment) at a rate
per annum equal to the Prime Rate plus two percent (2%).
(b) REINVESTMENT. Proceeds from the disposition of Bridge
Financings, Temporary Investments and Portfolio Investments may, in the
sole discretion of the General Partner, be retained and reinvested by
the Partnership to the same extent that the Institutional Fund is
permitted by the Institutional Fund Agreement to reinvest proceeds from
the disposition of such financings and investments;
(c) PARTICIPATION. The Partners shall participate in Bridge
Financings and Portfolio Investments in proportion to their Available
Capital Commitments.
4.2 SPECIAL INVESTMENT VEHICLE; BLOCKER STRUCTURES. (a) If the General
Partner determines for legal, tax, regulatory or other reasons that it is
appropriate for any or all of the Partners to participate in one or more
investments, each of which would be a Portfolio Investment if it were made by
the Partnership, through an entity other than the Partnership, the General
Partner may structure the making of such investment or investments outside of
the Partnership by requiring each such Partner to contribute capital to an
alternative entity (each, a "SPECIAL INVESTMENT VEHICLE") that, in lieu of the
Partnership, shall invest in such investment or investments. In such event, (i)
each such Partner shall make a capital commitment directly to such Special
Investment Vehicle and such capital commitment shall reduce the Capital
Commitment of such Partner to the same extent, and (ii) each such Limited
Partner shall participate in the Special Investment Vehicle pursuant to the
Power of Attorney executed by such Limited Partner, and
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documentation with respect to such Special Investment Vehicle shall be executed
and delivered on behalf of each such Limited Partner by the General Partner
pursuant to such Power of Attorney. The economic terms of the organizational
documents of any Special Investment Vehicle shall be substantially similar in
all material respects to those of the Partnership.
(b) If the General Partner determines, in its sole discretion,
that a Portfolio Investment may give rise to material taxable income
which is (or is taken into account as if it were) effectively connected
with the conduct of a trade or business within the United States to a
Limited Partner subject to tax on such income under section 871(b) or
897 of the Code, the General Partner may cause the Partnership to
invest in such Portfolio Investment through an entity treated as a
corporation for United States federal income tax purposes, in which
event the General Partner may utilize one or more Special Investment
Vehicles and/or subsidiaries of the Partnership.
4.3 TEMPORARY INVESTMENTS. The General Partner may invest funds held by
the Partnership in Temporary Investments pending investment in Portfolio
Investments, pending distribution or for any other purpose.
SECTION 5
CAPITAL CONTRIBUTIONS AND CAPITAL COMMITMENTS
5.1 CAPITAL CONTRIBUTIONS AND CAPITAL COMMITMENTS OF THE PARTNERS. (a)
Subject to Sections 5.4 and 10.1(b), each Partner shall, to the extent requested
by the General Partner, make Capital Contributions to the Partnership in the
aggregate amount of their respective Capital Commitments as set forth in such
Partner's Subscription Agreement and/or as reflected in the records of the
Partnership.
(b) Such Capital Contributions shall be drawn down in
installments, each of which shall be contributed by each Partner in
United States dollars. The first installment (in an amount equal to
twenty percent (20%) of such Partner's Capital Commitment) shall be
paid on the Closing Date on which such Partner is admitted to the
Partnership. Subsequent capital installments (each in an amount equal
to at least ten percent (10%) of such Partner's Capital Commitment, but
never in an amount greater than such Partner's Remaining Capital
Commitment) shall be paid in separate Drawdowns in the sole discretion
of the General Partner, subject to the following terms and conditions:
(i) The General Partner shall provide each Partner
with a notice (the "DRAWDOWN NOTICE") at least thirty days
prior to the date of Drawdown.
(ii) Each Partner shall pay to the Partnership the
Capital Contribution of such Partner as specified in the
Drawdown Notice in cash
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or other immediately available funds, by the date specified in
the applicable Drawdown Notice.
5.2 DEFAULTING PARTNER. If any Limited Partner fails to contribute, in
a timely manner, any portion of the Capital Commitment required to be
contributed by such Limited Partner and any such failure continues for ten
Business Days after receipt of written notice thereof from the General Partner
(a "DEFAULT"), then such Limited Partner (a "DEFAULTING PARTNER") may be
designated by the General Partner as in default and shall thereafter be subject
to the provisions of this Section 5.2. The General Partner may choose not to
designate any Limited Partner as a Defaulting Partner and may agree to waive or
permit the cure of any Default by a Limited Partner, subject to such conditions
as the General Partner and the Defaulting Partner may agree upon. In the event
that a Limited Partner becomes a Defaulting Partner, (i) such Defaulting
Partner's Remaining Capital Commitment shall be deemed to be zero, (ii) such
Defaulting Partner shall have no interest in future Portfolio Investments and no
right to contribute capital to future Portfolio Investments, and (iii) such
Limited Partner shall be entitled to receive only one-half of the total
distributions (including, without limitation, distributions previously made)
that it would have been entitled to receive had it not become a Defaulting
Partner, with the other one-half of such distributions to be applied when and as
amounts become distributable, FIRST to the Partnership in an amount equal to
such Limited Partner's PRO RATA share of the accrued and unpaid and/or
anticipated expenses of the Partnership (including any amounts payable upon
dissolution or to fund indemnification obligations), and SECOND, to all Partners
other than Defaulting Partners in accordance with their respective Capital
Commitments; PROVIDED, that the General Partner, MMC, or any of their respective
Affiliates (other than any natural person) shall have an option to assume the
Remaining Capital Commitments of the Defaulting Partner. From time to time it
may be necessary (because of irregular or insufficient cashflows or otherwise)
for the Partnership, the General Partner or the Manager to advance payment of
expenses allocable to the interest of a Defaulting Partner whose Remaining
Capital Commitment has been deemed to be zero pursuant to this Section 5.2 and,
before any amounts may be distributed by the Partnership pursuant to the
immediately preceding sentence, the amount of any such payment, plus interest
(at the Applicable Federal Rate, determined on and calculated from the date of
such payment), shall be deducted from future distributions by the Partnership in
respect of such Defaulting Partner's interest and paid by the Partnership to the
Person that made such advance payment. The General Partner shall make such
adjustments, including, without limitation, adjustments to the Capital Accounts
of the Partners (including, without limitation, the Defaulting Partners), as it
determines to be appropriate to give effect to the provisions of this Section
5.2. On any date following a Default by a Defaulting Partner, such Defaulting
Partner shall be required to pay to the Partnership all amounts that such
Defaulting Partner would be required to contribute to the Partnership if the
Partnership were dissolved as of such date (and its assets liquidated at fair
market value as of the most recent valuation date). Notwithstanding any other
provision of this Section 5.2, the obligations of any Defaulting Partner to the
Partnership hereunder shall not be extinguished as a result of the transactions
contemplated by this Section 5.2. Whenever the vote, consent or decision of a
Limited Partner or of the Limited Partners is required or permitted pursuant to
this Agreement or under the Partnership Law, a Defaulting Partner shall not be
entitled to
10
participate in such vote or consent, or to make such decision, and such vote,
consent or decision shall be tabulated or made as if such Defaulting Partner
were not a Limited Partner.
5.3 FURTHER ACTIONS. To the extent deemed necessary in the sole
discretion of the General Partner, the General Partner shall cause this
Agreement to be amended, without the need for any further act, vote or approval
of any other Partner or Persons, to reflect as appropriate the occurrence of any
of the transactions referred to in this Section 5 or in Section 11.
5.4 EXCUSED INVESTMENTS. The General Partner may, in its sole
discretion, excuse any Limited Partner from participation in any investment of
the Partnership if the General Partner has determined, in its sole discretion,
that such investment may constitute a conflict of interest for such Limited
Partner.
SECTION 6
CAPITAL ACCOUNTS; DISTRIBUTIONS
6.1 CAPITAL ACCOUNTS. There shall be established on the books and
records of the Partnership a capital account (a "CAPITAL ACCOUNT") for each
Partner.
6.2 ADJUSTMENTS TO CAPITAL ACCOUNTS. As of the last day of each Period,
the balance in each Partner's Capital Account shall be adjusted by (A)
increasing such balance by (i) such Partner's allocable share of each item of
the Partnership's income and gain for such Period (allocated in accordance with
Section 6.8) and (ii) the Capital Contributions, if any, made by such Partner
during such Period and (B) decreasing such balance by (i) the amount of cash or
the Value of Securities or other property distributed or deemed distributed to
such Partner pursuant to Sections 6 or 13 and (ii) such Partner's allocable
share of each item of the Partnership's deduction or loss for such Period
(allocated in accordance with Section 6.8). Each Partner's Capital Account shall
be further adjusted with respect to any special allocations or adjustments
pursuant to this Agreement.
6.3 DISTRIBUTIONS. Except as otherwise provided in this Agreement
(including in Section 4.1(b)), Distributable Cash shall be distributed to the
Partners in proportion to their Sharing Percentages for the Bridge Financing,
Temporary Investment or Portfolio Investment to which such Distributable Cash is
attributable.
6.4 OVERRIDING PROVISION. Notwithstanding any other provision of this
Agreement, distributions shall be made only to the extent of Available Assets
and in compliance with the Partnership Law.
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6.5 DISTRIBUTIONS IN KIND. Prior to the dissolution of the Partnership,
distributions may be in cash or marketable Securities. In connection with the
liquidation and dissolution of the Partnership, distributions may also include
restricted Securities or other assets of the Partnership. In the event a
distribution of Securities or other assets is made, such Securities or other
assets shall be deemed to have been sold at their Value and the proceeds of such
sale shall be deemed to have been distributed to the Partners for all purposes
of this Agreement. Subject to Section 13.2, Securities or other assets
distributed in kind shall be distributed in proportion to the aggregate amounts
that would be distributed to each Partner pursuant to Section 6.3, such
aggregate amounts to be estimated in the good faith judgment of the General
Partner. The General Partner may cause certificates evidencing any Securities to
be distributed to be imprinted with legends as to such restrictions on Transfers
that it may deem necessary or appropriate, including, without limitation,
legends as to applicable United States federal or state or non-U.S. Securities
laws or other legal or contractual restrictions, and may require any Partner to
whom Securities are to be distributed to agree in writing (i) that such
Securities shall not be transferred except in compliance with such restrictions
and (ii) to such other matters as the General Partner may deem necessary or
appropriate.
6.6 NEGATIVE CAPITAL ACCOUNTS. No Limited Partner shall, and except as
otherwise required by law the General Partner shall not, be required to make up
a negative balance in its Capital Account.
6.7 NO WITHDRAWAL OF CAPITAL. Except as otherwise expressly provided
herein, no Partner shall have the right to withdraw capital from the Partnership
or to receive any distribution of or return on such Partner's Capital
Contributions.
6.8 ALLOCATIONS. Each item of income, gain, loss, credit and deduction
of the Partnership (determined in accordance with U.S. tax principles as applied
to the maintenance of capital accounts) shall be allocated among the Capital
Accounts of the Partners with respect to each Period as of the end of such
Period in a manner that as closely as possible gives economic effect to the
provisions of Sections 6 and 13 and the other relevant provisions of this
Agreement.
6.9 TAX MATTERS. Except as otherwise provided herein, the income,
gains, losses, credits and deductions recognized by the Partnership shall be
allocated among the Partners, for United States federal, state and local income
tax purposes, to the extent permitted under the Code and the Treasury
Regulations, in the same manner that each such item is allocated to the
Partners' Capital Accounts. Notwithstanding the foregoing, the General Partner
shall have the power in its sole discretion to make such allocations for United
States federal, state and local income tax purposes as may be necessary to
maintain substantial economic effect, or to ensure that such allocations are in
accordance with the interests of the Partners in the Partnership, in each case
within the meaning of the Code and the Treasury Regulations. Tax credits shall
be allocated in good faith by the General Partner. All matters concerning
allocations for United States federal, state and local and non-U.S. income tax
purposes, including accounting procedures, not expressly provided for by the
terms of this Agreement shall be determined in good faith by the General
Partner. The General Partner may, in its sole discretion, cause the
12
Partnership to make the election under section 754 of the Code. The General
Partner is hereby designated as the "tax matters partner" of the Partnership, as
provided in the Treasury Regulations pursuant to section 6231 of the Code (and
any similar provisions under any other state or local or non-U.S. tax laws).
Each Partner hereby consents to such designation and agrees that upon the
request of the General Partner it shall execute, certify, acknowledge, deliver,
swear to, file and record at the appropriate public offices such documents as
may be necessary or appropriate to evidence such consent. Either the General
Partner shall have executed and filed a U.S. Internal Revenue Service Form 8832
prior to the date hereof electing to classify the Partnership as a partnership
for U.S. federal income tax purposes pursuant to section 301.7701-3 of the
Treasury Regulations as of a date no later than the date hereof, or the General
Partner shall timely execute and file such Form 8832 on or after the date hereof
electing to classify the Partnership as a partnership for United States federal
income tax purposes as of a date no later than the date hereof, and the General
Partner is hereby authorized to execute and file such Form for all of the
Partners. The General Partner shall not subsequently elect to change such
classification. The General Partner is hereby authorized to execute and file any
comparable form or document required by any applicable United States state or
local tax law in order for the Partnership to be classified as a partnership
under such tax law.
6.10 WITHHOLDING TAXES. (a) AUTHORITY TO WITHHOLD; TREATMENT OF
WITHHELD TAX. Notwithstanding any other provision of this Agreement, each
Partner hereby authorizes the Partnership to withhold and to pay over, or
otherwise pay, any withholding or other taxes payable by the Partnership or any
of its Affiliates (pursuant to the Code or any provision of United States
federal, state, or local or foreign tax law) with respect to such Partner or as
a result of such Partner's participation in the Partnership (including as a
result of a distribution in kind). If and to the extent that the Partnership
shall be required to withhold or pay any such withholding or other taxes, such
Partner shall be deemed for all purposes of this Agreement to have received a
payment from the Partnership as of the time such withholding or other tax is
required to be paid, which payment shall be deemed to be a distribution of
Distributable Cash pursuant to the relevant clause of Section 6.3 with respect
to such Partner's interest in the Partnership to the extent that such Partner
(or any successor to such Partner's interest in the Partnership) would have
received a cash distribution but for such withholding. To the extent that such
deemed payment exceeds the cash distribution that such Partner would have
received at such time but for such withholding, the General Partner shall notify
such Partner as to the amount of such excess and such Partner shall make a
prompt payment to the Partnership of such amount by wire transfer. The
Partnership may hold back from any distribution in kind property having a Value
equal to the amount of the taxes withheld or otherwise paid until the
Partnership has received such payment.
(b) WITHHOLDING TAX RATE. Any withholdings referred to in this
Section 6.10 shall be made at the maximum applicable statutory rate
under the applicable tax law unless the General Partner shall have
received an opinion of counsel or other evidence, satisfactory to the
General Partner, to the effect that a lower rate is applicable, or that
no withholding is applicable.
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(c) WITHHOLDING FROM DISTRIBUTIONS TO THE PARTNERSHIP. In the
event that the Partnership receives a distribution or payment from or
in respect of which tax has been withheld, the Partnership shall be
deemed to have received cash in an amount equal to the amount of such
withheld tax, and each Partner shall be treated as having received as a
distribution of Distributable Cash pursuant to the relevant clause of
Section 6.3 the portion of such amount that is attributable to such
Partner's interest in the Partnership as equitably determined by the
General Partner. To the extent that such deemed distribution exceeds
the cash distribution that such Partner would have received but for
such withholding, the General Partner shall notify such Partner as to
the amount of such excess and such Partner shall make a prompt payment
to the Partnership of such amount by check or wire transfer, which
payment shall not constitute a Capital Contribution and, consequently,
shall not reduce the Remaining Capital Commitment or increase the
Capital Account of such Partner. In the event that the Partnership
anticipates receiving a distribution or payment from which tax will be
withheld in kind, the General Partner may elect to prevent such in-kind
withholding by paying such tax in cash and may require each Partner in
advance of such distribution to make a prompt payment to the
Partnership by wire transfer of the amount of such tax attributable to
such Partner's interest in the Partnership as equitably determined by
the General Partner, which payment shall not constitute a Capital
Contribution and, consequently, shall not reduce the Remaining Capital
Commitment or increase the Capital Account of such Partner.
(d) INDEMNIFICATION. Each Partner shall, to the fullest extent
permitted by applicable law, indemnify and hold harmless the
Partnership and the General Partner against all claims, liabilities and
expenses of whatever nature relating to the Partnership's or the
General Partner's obligation to withhold and to pay over, or otherwise
pay, any withholding or other taxes payable by the Partnership or the
General Partner as a result of such Partner's participation in the
Partnership. In addition, the Partnership shall, hereby or pursuant to
a separate indemnification agreement and to the fullest extent
permitted by applicable law, indemnify and hold harmless each Portfolio
Company and any Covered Person who is or who is deemed to be the
responsible withholding agent for United States federal, state or local
or non-U.S. income tax purposes (other than any Covered Person that is
indemnified by each Partner pursuant to the previous sentence) against
all claims, liabilities and expenses of whatever nature relating to
such Portfolio Company's or Covered Person's obligation to withhold and
to pay over, or otherwise pay, any withholding or other taxes payable
by such Portfolio Company or Covered Person, as the case may be, as a
result of the participation in the Partnership of a Partner (other than
such Covered Person). If, pursuant to a separate indemnification
agreement or otherwise, the Partnership shall indemnify or be required
to indemnify any Portfolio Company or Covered Person against any
claims, liabilities or expenses of whatever nature relating to such
Portfolio Company's or Covered Person's obligation to withhold and to
pay over, or otherwise pay, any withholding or other taxes payable by
such Portfolio Company or Covered Persons as a result of any Partner's
participation in the Partnership,
14
such Partner shall pay to the Partnership the amount of the indemnity
paid or required to be paid.
6.11 FINAL DISTRIBUTION. The final distributions following dissolution
shall be made in accordance with the provisions of Section 13.2.
SECTION 7
THE MANAGER
The Partnership hereby appoints the Manager, and the Manager hereby
agrees, to act as the investment advisor to and manager of the Partnership, and
pursuant to such appointment:
(a) The Manager shall manage the operations of the
Partnership, shall have the right to execute and deliver documents on
behalf of the Partnership in lieu of the General Partner and shall have
discretionary authority with respect to investments of the Partnership,
including, without limitation, the authority to evaluate, monitor,
exercise voting rights, liquidate and take other appropriate action
with respect to investments on behalf of the Partnership, PROVIDED that
the management and the conduct of the activities of the Partnership
shall remain the sole responsibility of the General Partner and all
decisions relating to the selection and disposition of the
Partnership's investments shall be made exclusively by the General
Partner in accordance with this Agreement. Appointment of the Manager
by the Partnership shall not relieve the General Partner from its
obligations to the Partnership hereunder or under the Partnership Law.
(b) The Manager shall act in conformity with this Agreement
and with the instructions and directions of the General Partner.
The engagement by the Partnership of the Manager contemplated hereby may be set
forth in a separate management agreement specifying in further detail the rights
and duties of the Manager. Such engagement, whether or not set forth in such a
management agreement, shall terminate upon the filing of a notice of dissolution
of the Partnership as described in Section 13.4(b).
SECTION 8
BANKING, CUSTODY OF SECURITIES, ACCOUNTING,
BOOKS AND RECORDS, ADMINISTRATIVE SERVICES
8.1 BANKING; CUSTODY OF SECURITIES. All funds of the Partnership may be
deposited in such bank, brokerage or money market accounts as shall be
established by the General Partner. Withdrawals from and checks drawn on any
such account shall be made upon such signature or signatures as the General
Partner may designate. All Securities held by the Partnership shall be held by a
custodian or at a bank or other secure location selected by the General Partner.
15
8.2 MAINTENANCE OF BOOKS AND RECORDS; ACCESS.
(a) MAINTENANCE. The General Partner shall keep or cause to be
kept complete records and books of account. Such books and records
shall be maintained in accordance with the provisions of the
Institutional Fund Agreement applicable to the records and books of
account of the Institutional Fund as if such provisions were applicable
to the Partnership. The books and records required by law to be
maintained at the registered office of the Partnership shall be so
maintained pursuant to the provisions of the Partnership Law. In
particular, the General Partner shall maintain, or cause to be
maintained, at the registered office of the Partnership, in accordance
with the Partnership Law, a register containing the name and address,
amount and date of the contribution or contributions of each Partner
and the amount and date of any payment representing a return of any
part of the contributions of any Partner (the "REGISTER OF PARTNERSHIP
INTERESTS"), which register shall be updated within twenty-one Business
Days of any change in the particulars therein. In accordance with the
Partnership Law, the Register of Partnership Interests shall be PRIMA
FACIE evidence of the matters which are required to be inserted therein
and shall be open to inspection by any Person during all business
hours.
(b) ACCESS. Such books and records shall be available, upon
five Business Days' notice to the General Partner, for inspection and
copying at reasonable times during normal business hours by a Limited
Partner or its duly authorized agents or representatives for any
purpose reasonably related to such Limited Partner's interest as a
limited partner in the Partnership. The General Partner shall have the
right to keep confidential from the Limited Partners for such period of
time as the General Partner deems reasonable, any information the
disclosure of which the General Partner deems in its sole discretion to
be not in the best interest of the Partnership or its business or which
the Partnership is required by law or by agreement with a third party
to keep confidential, PROVIDED, that nothing in this Section 8.2 shall
prevent the Partnership from distributing to Partners the financial
reports referred to in Sections 9.2 and 9.3.
8.3 PARTNERSHIP TAX RETURNS. The General Partner shall cause the
Partnership initially to elect the Fiscal Year as its taxable year and shall
cause to be prepared and timely filed all tax returns required to be filed for
the Partnership in the jurisdictions in which the Partnership conducts business
or derives income for all applicable tax years.
SECTION 9
REPORTS TO PARTNERS, ANNUAL MEETING, VALUATIONS
9.1 INDEPENDENT AUDITORS. The books of account and records of the
Partnership shall be audited as of the end of each Fiscal Year by such
recognized accounting firm as shall be selected by the General Partner. The
Partnership's independent public accountants shall be a recognized independent
public accounting firm selected from time to time by the General Partner in its
discretion. All reports provided
16
to the Limited Partners pursuant to Section 9.2 shall be prepared in accordance
with United States generally accepted accounting principles consistently
applied. The Partnership's financial statements shall not be consolidated with
those of the General Partner, any Portfolio Company or any Affiliate of the
Partnership, unless such consolidation shall be required by United States
generally accepted accounting principles, in which case the Partnership shall
provide "stand-alone" financial statements for the Partnership, reviewed by the
Partnership's independent public accounting firm on an unconsolidated basis
pursuant to investment company accounting standards as reasonably determined by
the General Partner.
9.2 PARTNERSHIP REPORTS TO LIMITED PARTNERS. (a) ANNUAL REPORTS. As
soon as practicable (but in any event within 180 days) after the end of each
Fiscal Year, the General Partner shall prepare and mail or cause to be prepared
and mailed to each Limited Partner audited financial statements of the
Partnership, a statement of such Limited Partner's capital account and such
other information as the General Partner, in its sole discretion, deems
appropriate.
(b) SEMI-ANNUAL REPORTS. As soon as practicable (but in any
event within 120 days) after the end of the second fiscal quarter each
Fiscal Year, the General Partner shall prepare and mail or cause to be
prepared and mailed to each Limited Partner unaudited financial
statements of the Partnership and such other information as the General
Partner, in its sole discretion, deems appropriate.
9.3 UNITED STATES FEDERAL INCOME TAX INFORMATION. The General Partner
shall use its commercially reasonable best efforts to send, no later than 90
days after the end of each Fiscal Year, to each Limited Partner (or its legal
representative) and to each other Person that was a Limited Partner (or its
legal representative) at any time during such Fiscal Year, a Schedule K-1,
"Partner's Share of Income, Credits, Deductions, Etc.," to United States
Internal Revenue Service Form 1065, "U.S. Partnership Return of Income," or any
successor form, filed by the Partnership for such Person.
9.4 ANNUAL MEETING. The General Partner may, but shall not be obligated
to, cause the Partnership to have a meeting of the Limited Partners each year
(the "ANNUAL MEETING") and shall give 20 Business Days' advance written notice
to each Limited Partner of such meeting. At the Annual Meeting, the Partners
shall be permitted to meet with the senior management of the Manager to consult
on general economic and financial trends and on the Partnership's existing
Portfolio Investments. In order to help ensure each Limited Partner's limitation
of liability pursuant to Section 3.3, the Partnership's potential investments
shall not be submitted for discussion and none of the Partners shall play any
role in the Partnership's governance or participate in the control of the
business of the Partnership in his or her capacity as Limited Partner.
9.5 VALUATION. For all purposes of this Agreement, "VALUE" shall mean,
with respect to any Security, including, but not limited to, any Security owned
(directly or indirectly) by the Partnership at any time, the fair market value
of such Security, as determined by the General Partner in its sole discretion.
"FAIR MARKET VALUE" generally shall be determined by the General Partner by
reference to such factors as it deems
17
appropriate, including, with respect to a Security owned (directly or
indirectly) by the Partnership, the valuation set forth in the Partnership's
last annual or semi-annual financial statements. Any valuation may, in the
discretion of the General Partner, be made by one or more independent third
parties appointed by the General Partner and deemed qualified by the General
Partner to render valuation opinions, which third parties may use such methods
and consider such information as they may deem appropriate.
SECTION 10
INDEMNIFICATION
10.1 INDEMNIFICATION OF COVERED PERSONS. (a) GENERAL. The Partnership
shall and hereby does, to the fullest extent permitted by applicable law,
indemnify, hold harmless and release each Covered Person from and against all
claims, demands, liabilities, costs, expenses, damages, losses, suits,
proceedings and actions, whether judicial, administrative, investigative or
otherwise, of whatever nature, known or unknown, liquidated or unliquidated
("CLAIMS"), that may accrue to or be incurred by any Covered Person, or in which
any Covered Person may become involved, as a party or otherwise, or with which
any Covered Person may be threatened, relating to or arising out of the business
and affairs of, or activities undertaken in connection with, the Partnership
(including, but not limited to, Claims arising out of the disposition of any
Portfolio Company), or otherwise relating to or arising out of this Agreement,
including, but not limited to, amounts paid in satisfaction of judgments, in
compromise or as fines or penalties, and counsel fees and expenses incurred in
connection with the preparation for or defense or disposition of any
investigation, action, suit, arbitration or other proceeding (a "PROCEEDING"),
whether civil or criminal (all of such Claims and amounts covered by this
Section 10.1 and all expenses referred to in Section 10.2 are referred to as
"DAMAGES"), except to the extent that it shall have been determined ultimately
by a court of competent jurisdiction that such Damages arose primarily from the
Disabling Conduct of such Covered Person. The termination of any Proceeding by
settlement shall not, of itself, create a presumption that such Covered Person
has engaged in Disabling Conduct or any Damages relating to such settlement
arose primarily from the Disabling Conduct of any Covered Person.
(b) CONTRIBUTION. Notwithstanding any other provision of this
Agreement, at any time and from time to time and prior to the last day
of the Term, the General Partner may require the Partners to contribute
to the Partnership an amount sufficient to satisfy all or any portion
of the indemnification obligations of the Partnership pursuant to
Section 6.10(d) or Section 10.1(a), PROVIDED that each Partner shall
make such contributions in respect of its share of any such
indemnification obligations made or required to be made as follows:
(i) if the Claims or Damages so indemnified against
arise out of a Bridge Financing, Temporary Investment or
Portfolio Investment, according to its Sharing Percentage with
respect to such financing or investment; and
18
(ii) thereafter, or in any other circumstances,
proportionately according to its Capital Commitment.
Notwithstanding anything in this Section 10 to the contrary, a Partner's
liability under the first sentence of this Section 10.1(b) is limited to such
Partner's Capital Commitment. Nothing in this Section 10.1(b), express or
implied, is intended or shall be construed to give any Person other than the
Partnership or the Partners any legal or equitable right, remedy or claim under
or in respect of this Section 10.1(b) or any provision contained herein.
10.2 EXPENSES, ETC. To the fullest extent permitted by applicable law,
expenses incurred by a Covered Person in defense or settlement of any Claim that
may be subject to a right of indemnification hereunder shall be advanced by the
Partnership prior to the final disposition thereof upon receipt of an
undertaking by or on behalf of the Covered Person to repay such amount if it
shall be determined ultimately by a court of competent jurisdiction that the
Covered Person is not entitled to be indemnified hereunder. The right of any
Covered Person to the indemnification provided herein shall be cumulative with,
and in addition to, any and all rights to which such Covered Person may
otherwise be entitled by contract or as a matter of law or equity and shall
extend to such Covered Person's successors, assigns and legal representatives.
All judgments against the Partnership, and all judgments against the Partnership
and either or both of the General Partner and/or the Manager in respect of which
the General Partner and/or the Manager is/are entitled to indemnification, shall
first be satisfied from Partnership assets (including, without limitation,
Capital Contributions and any payments under Section 10.1(b)), before the
General Partner or the Manager, as the case may be, is responsible therefor.
10.3 NOTICES OF CLAIMS, ETC. Promptly after receipt by a Covered Person
of notice of the commencement of any Proceeding, such Covered Person shall, if a
claim for indemnification in respect thereof is to be made against the
Partnership, give written notice to the Partnership of the commencement of such
Proceeding, PROVIDED that the failure of any Covered Person to give notice as
provided herein shall not relieve the Partnership of its obligations under this
Section 10, except to the extent that the Partnership is actually prejudiced by
such failure to give notice. In case any such Proceeding is brought against a
Covered Person (other than a derivative suit in right of the Partnership), the
Partnership shall be entitled to participate in and to assume the defense
thereof to the extent that the Partnership may wish, with counsel reasonably
satisfactory to such Covered Person. After notice from the Partnership to such
Covered Person of the Partnership's election to assume the defense of such
Proceeding, the Partnership shall not be liable for expenses subsequently
incurred by such Covered Person in connection with the defense thereof. The
Partnership shall not consent to entry of any judgment or enter into any
settlement that does not include as an unconditional term thereof the giving by
the claimant or plaintiff to such Covered Person of a release from all liability
in respect to such Claim.
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10.4 NO WAIVER. Nothing contained in this Section 10 shall constitute a
waiver by any Partner of any right that it may have against any party under any
U.S. federal or state securities laws, Cayman Islands or other non-U.S. laws.
10.5 COVERED PERSONS MAY RELY AND ENFORCE. It is the express intention
of the parties hereto that the provisions of this Section 10 for the
indemnification of Covered Persons may be relied upon by such Covered Persons
and may be enforced by such Covered Persons (or by the General Partner on behalf
of any such Covered Person, PROVIDED that the General Partner shall not have any
obligation to so act for or on behalf of any such Covered Person) against the
Partnership and the Partners as if such Covered Persons were parties hereto.
SECTION 11
TRANSFERS, REDEMPTIONS AND WITHDRAWALS
11.1 GENERAL RESTRICTIONS ON TRANSFERS AND WITHDRAWALS; MATERIAL
ADVERSE EFFECTS; REGULATORY REDEMPTIONS.
(a) GENERAL. Except as set forth in this Section 11, no
Additional Limited Partners may be admitted to and no Limited Partner
may withdraw from the Partnership prior to the dissolution and
winding-up of the Partnership. No Limited Partner may Transfer all or
any part of its interest in the Partnership other than for the reasons
set forth in this Section 11, and then only to a Permitted Transferee
upon satisfaction of any conditions deemed necessary, convenient or
desirable by the General Partner and with the prior written consent of
the General Partner, which consent may be withheld in the sole
discretion of the General Partner. No Transfer shall be recognized by
the Partnership unless effected in accordance with this Agreement.
(b) LIMITED PARTNERS WITH ADVERSE EFFECTS. (i) If at any time
the General Partner determines (after consultation with counsel
reasonably satisfactory to the General Partner) that there is a
reasonable likelihood that for any reason (other than the reason set
forth in (c) below) the continuing participation in the Partnership by
any Limited Partner might have a Material Adverse Effect on the
Partnership or any Portfolio Company, such Limited Partner shall, upon
the written request of the General Partner, Transfer its entire
interest in the Partnership (or such portion of its interest that, in
the sole discretion of the General Partner, is sufficient to prevent or
remedy a Material Adverse Effect) for Value to a Permitted Transferee
designated by the General Partner.
(c) REDEMPTION FOR REGULATORY REASONS. Notwithstanding Section
11.1(b), the Limited Partners hereby acknowledge and agree that the
General Partner may accept subscriptions from more than 500 Limited
Partners in anticipation of receiving no-action relief from the SEC
with respect to certain public reporting and other regulatory
requirements under the Exchange Act applicable to issuers whose
interests are held by more than 500 Persons. In the
20
event that the SEC declines to grant the requested relief, the General
Partner shall have the right to redeem (or to designate another
Permitted Transferee to redeem) the interests of one or more Limited
Partners, which Limited Partners shall be selected by the General
Partner in its sole discretion. Each Limited Partner whose interest in
the Partnership is redeemed pursuant to this Section 11.1(c) shall be
entitled to receive, as consideration for such redemption, an amount
equal to the sum of (i) the aggregate amount - of such Limited
Partner's Capital Contributions, less any amounts distributed by the
Partnership to such Limited Partner prior to such redemption, plus (ii)
interest. For the purposes of this Section 11.1(c), (A) capital held by
the Partnership in Temporary Investments pending investment in
Portfolio Investments will earn the actual amount of interest earned by
the Partnership thereon and (B) capital invested by the Partnership in
Portfolio Investments or Bridge Financings will earn the - Applicable
Federal Rate, determined on and calculated from the date on which such
capital was invested by the Partnership. Any Limited Partner whose
interest in the Partnership is redeemed pursuant to this Section
11.1(c) shall, immediately upon such redemption, cease to be a Partner
and shall be deemed never to have been a Partner for all purposes of
this Agreement.
11.2 ADDITIONAL LIMITED PARTNERS. (a) CONDITIONS TO ADMISSION. In
addition to the admission of Limited Partners at the initial Closing, the
General Partner, in its sole discretion, may schedule, from time to time, one or
more additional closings on any date for one or more Person or Persons seeking
admission to the Partnership as additional limited partners of the Partnership
(each such Person, an "ADDITIONAL LIMITED PARTNER", which term shall include any
Person that is a Partner immediately prior to such additional Closing and that
wishes to increase the amount of its Capital Commitment), subject to the
determination by the General Partner in the exercise of its good faith judgment
that in the case of each admission or increase the following conditions have
been satisfied:
(i) Each such Additional Limited Partner shall have
executed and delivered such instruments and shall have taken
such actions as the General Partner shall deem necessary,
convenient or desirable to effect such admission or increase,
including, without limitation, the execution of (A) a
Subscription Agreement, (B) a counterpart of this Agreement
pursuant to which such Additional Limited Partner agrees to be
bound by the terms and provisions hereof or to increase the
amount of such Limited Partner's Capital Commitment, as the
case may be, and (C) a Power of Attorney.
(ii) Such admission or increase shall not result in a
violation of any applicable law, including, without
limitation, Cayman Islands and United States federal and state
securities laws, or any term or condition of this Agreement
and, as a result of such admission or such increase, the
Partnership shall not be required to register as an Investment
Company under the Investment Company Act or any law of similar
import of the Cayman Islands; none of the General Partner, the
Manager or any Affiliate of the General Partner or the Manager
would be required to register as an
21
investment adviser under the Investment Advisers Act or any
law of similar import of the Cayman Islands and the
Partnership shall not become taxable as a corporation or
association.
(iii) On the date of its admission to the Partnership
or the date of such increase, as the case may be, such
Additional Limited Partner shall have paid or unconditionally
agreed to pay to the Partnership, an amount equal to the sum
of
(A) in the case of each Portfolio Investment
then held by the Partnership, the percentage of such
Additional Limited Partner's Capital Commitment or
(if the Additional Limited Partner is increasing its
Capital Commitment) the percentage of the amount of
the increase of such Additional Limited Partner's
Capital Commitment that is equal to a fraction, (1)
the numerator of which is the aggregate of the
Capital Contributions of the - previously admitted
Partners used to fund the cost of such Portfolio
Investment and (2) the denominator of - which is the
sum of the aggregate of (X) the Capital Commitments
of the previously admitted Partners that - made
Capital Contributions used to fund the cost of such
Portfolio Investment and (Y) (without duplication) -
the Capital Commitments of all Additional Limited
Partners, and
(B) the percentage of such Additional
Limited Partner's Capital Commitment or (if such
Additional Limited Partner is increasing its Capital
Commitment) the percentage of the amount of the
increase of such Additional Limited Partner's Capital
Commitment that is equal to a fraction, (1) the
numerator of which is the aggregate of the Capital -
Contributions of the previously admitted Limited
Partners in respect of all Drawdowns which have
theretofore been funded and not returned to the
Partners, other than Drawdowns made and used to fund
the cost of a Portfolio Investment and (2) the
denominator of which is the sum of the aggregate of
(X) the - - Capital Commitments of all previously
admitted Partners and (Y) (without duplication) the
Capital - Commitments of all Additional Limited
Partners,
together with, in the case of clauses (A) and (B), an amount calculated
as interest thereon at a rate per annum equal to the Prime Rate plus
two percent (2%) from the dates that contribution of such amounts by
such Additional Limited Partner would have been due if such Additional
Limited Partner had been admitted to the Partnership or had increased
its Capital Commitment, as the case may be, on the date of the initial
Closing, to the date that the payment required to be made by such
Additional Limited Partner pursuant to this Section 11.2(a)(iii) is
made, which interest shall be treated as provided in Section 11.2(b),
and less such amount as is necessary to take into account all
distributions theretofore made.
22
A Person shall be deemed admitted to the Partnership as an Additional Limited
Partner at the time that the foregoing conditions are satisfied and when such
Person is listed as a limited partner of the Partnership on the register of
partnership interests of the Partnership maintained at the registered office of
the Partnership.
(b) CERTAIN PAYMENTS AND TRANSFERS. Any amount paid by an
Additional Limited Partner pursuant to Section 11.2(a)(iii)(A) with
respect to the acquisition of Portfolio Investment (and any interest
paid thereon) shall be remitted promptly to the previously admitted
Partners, PRO RATA in accordance with their Capital Contributions used
to fund the acquisition of such Portfolio Investment (before giving
effect to the adjustments referred to in the following clause), and the
Partners' Sharing Percentages for such Portfolio Investment shall be
appropriately adjusted. Any amount paid by an Additional Limited
Partner pursuant to Section 11.2(a)(iii)(B) (and any interest paid
thereon) shall be remitted promptly to the previously admitted
Partners, PRO RATA in accordance with their Capital Commitments. Such
payments and remittances shall, in accordance with section 707(a) of
the Code, be treated for all purposes of this Agreement and for all
accounting and tax reporting purposes as payments made directly from
the Additional Limited Partner to the previously admitted Partners and
not as items of Partnership income, gain, loss, deduction, contribution
or distribution. Such Additional Limited Partner shall succeed to the
Capital Contributions of the previously admitted Partners attributable
to the portion of the amount remitted to such previously admitted
Partners pursuant to Section 11.2(a)(iii) (not including any amount
calculated as interest thereon), as appropriate, and the Capital
Contributions of the previously admitted Partners shall be decreased
accordingly. In addition, the Remaining Capital Commitments of the
previously admitted Limited Partners shall be increased by such amount
remitted (not including any amount calculated as interest thereon), and
the amount of such increase in Remaining Capital Commitments may be
called again by the Partnership. The Remaining Capital Commitment of
the Additional Limited Partner shall be appropriately determined by the
General Partner. The Register of Partnership Interests shall be amended
by the General Partner as appropriate to show the name and business
address of each Additional Limited Partner and the amount of its
Capital Commitment. Neither the admission of an Additional Limited
Partner nor an increase in the amount of an Additional Limited
Partner's Capital Commitment shall be a cause for dissolution of the
Partnership. The transactions contemplated by this Section 11.2 shall
not require the consent of any of the Limited Partners.
(c) NO CONSENT. The transactions contemplated by this Section
11.2 shall not require the consent of any of the Limited Partners.
11.3 MULTI-FUND AND MULTI-VEHICLE ADJUSTMENTS. Any payments to be made
by, and the distributions and/or adjustments to be made to, certain Partners
pursuant to Section 11.2 (a) and (b) and the equivalent provisions of the
Institutional Fund Agreement shall be adjusted as necessary to take into account
(i) that investments held by the Partnership may, as of any Closing Date, be
held by one or more Parallel Funds,
23
(ii) that a portion of each Limited Partner's Capital Commitment originally made
to the Partnership may become a capital commitment to one or more Special
Investment Vehicles and (iii) any closing of a Parallel Fund. Investments held
by the Partnership, Parallel Funds and/or Special Investment Vehicles may be
transferred among such entities to effectuate the purposes of the Institutional
Fund Agreement. After the payments, distributions and adjustments described in
this Section 11.3 and in the equivalent provisions of the Institutional Fund
Agreement are taken into account, each investment in a Portfolio Company shall
be held by the Partnership and any Parallel Fund in proportion to their
respective capital commitments, including, without limitation, all capital
committed to the Partnership or any such Parallel Fund, as the case may be,
after the date on which such investment was made, but only to the extent such
capital commitments shall be applied to be invested in such Portfolio Company.
11.4 EFFECT OF TERMINATION OF EMPLOYMENT. (a) Upon the death, Total
Disability or Retirement (as such terms are defined in the MMC Companies
Benefits Program) of a Limited Partner, (i) such Limited Partner (or its estate)
shall retain its interest in the Partnership, PROVIDED that such Limited Partner
(or its representative) may request that its interest in the Partnership be
purchased by the General Partner (or another Permitted Transferee designated by
the General Partner) for Value, (ii) the obligation of such Limited Partner to
make Capital Contributions shall terminate and such Limited Partner shall have
no right to participate in future Portfolio Investments, Bridge Financings or
other investments by the Partnership, except that a Retiring Limited Partner's
obligation to make Capital Contributions shall not be terminated other than at
the request of such Partner, (iii) any capital contributed to the Partnership by
such Limited Partner but not yet invested in a Portfolio Investment or Bridge
Financing shall be distributed (net of any amounts that would be deductible if
such capital was distributed pursuant to clause (iv) below) to such Limited
Partner (or its estate) and (iv) if such Limited Partner retains its interest
but its obligation to contribute capital to the Partnership is terminated, the
Partnership shall be permitted to deduct from any Distributable Cash
attributable to such Limited Partner's interest in the Partnership amounts equal
to the accrued and unpaid and/or anticipated expenses of the Partnership
(including any amounts payable upon dissolution or to fund indemnification
obligations) allocable to such Limited Partner's interest. The General Partner
may grant any requests made by Limited Partners pursuant to this Section 11.4(a)
in whole or in part, but shall have no obligation to do so.
(b) Upon the termination of the employment of a Limited
Partner with MMC for any reason other than death, Total Disability or
Retirement (as such terms are defined in the MMC Companies Benefits
Program), (i) the General Partner shall have the right, - but not the
obligation, to purchase (or to designate another Permitted Transferee
to purchase) such Limited Partner's interest in the Partnership for
Value, (ii) the obligation of such Limited Partner to make Capital
Contributions shall -- terminate and such Limited Partner shall have no
right to participate in future Portfolio Investments, Bridge Financings
or other investments by the Partnership, shall be terminated, (iii) any
capital contributed to the Partnership by such Limited Partner but not
yet invested in a Portfolio Investment or Bridge Financing shall be
distributed (net of any amounts that
24
would be deductible if such capital was distributed pursuant to clause
(iv) below) to such Limited Partner and (iv) if such Limited Partner
retains its interest, the Partnership shall be permitted to deduct from
any Distributable Cash attributable to such Limited Partner's interest
in the Partnership amounts equal to the accrued and unpaid and/or
anticipated expenses of the Partnership (including any amounts payable
upon dissolution or to fund indemnification obligations) allocable to
such Limited Partner's interest.
(c) From time to time it may be necessary (because of
irregular or insufficient cashflows or otherwise) for the Partnership,
the General Partner or the Manager to advance payment of expenses
allocable to the interest of a Limited Partner whose Capital Commitment
has been terminated pursuant to this Section 11.4. The amount of any
such payment, plus interest (at the Applicable Federal Rate, determined
on and calculated from the date of such payment), shall be deducted
from future distributions by the Partnership to such Limited Partner
and paid by the Partnership to the Person that made such advance
payment.
(d) Amounts retained or deducted pursuant to this Section 11.4
shall be invested by the Partnership in Temporary Investments pending
their use and, to the extent unused, will be distributed as set forth
in Section 13.2 upon the dissolution of the Partnership, unless the
General Partner, in its sole discretion, elects to distribute all or
any lesser portion of them earlier.
11.5 TRANSFER OR WITHDRAWAL BY THE GENERAL PARTNER. The General Partner
shall not Transfer all or any part of its interest as the general partner of the
Partnership, and the General Partner shall not withdraw as the general partner
of the Partnership. Notwithstanding the foregoing, and to the extent permitted
by law,
(a) the General Partner may at its election convert to a
limited partnership, limited liability company or other entity formed
under the laws of the Cayman Islands or any other jurisdiction, or
(b) the General Partner may Transfer its interest as the
general partner of the Partnership to, or be merged with and into, a
limited partnership, limited liability company or other entity formed
under the laws of the Cayman Islands or any other jurisdiction for the
purpose of serving as the general partner of the Partnership,
but only if in any such case the partners of such limited partnership, the
members of such limited liability company or the equity holders of such other
entity, as the case may be, include the Persons that are the general partners or
controlling equity holders of the General Partner.
Upon any such conversion to such a limited partnership, limited liability
company or other entity, or any such Transfer by or merger of the General
Partner to or with such a limited partnership, limited liability company or
other entity, such limited partnership, limited liability company or other
entity shall be deemed to be the same Person as the
25
General Partner for all purposes of this Agreement. All Subscription Agreements
applicable to the Partnership that are in effect at the time of any such
conversion, Transfer, or merger shall thereafter continue in full force and
effect.
SECTION 12
DEATH, INCOMPETENCY OR BANKRUPTCY
OR DISSOLUTION OF PARTNERS
12.1 BANKRUPTCY OR DISSOLUTION OF THE GENERAL PARTNER. In the event of
the bankruptcy or dissolution and commencement of winding-up of the General
Partner, or the occurrence of any other event that causes the General Partner to
cease to be a general partner of the Partnership under the Partnership Law, the
Partnership shall be dissolved and its affairs shall be wound up as provided in
Section 13, unless the business of the Partnership is continued pursuant to
Section 13.1(a).
12.2 DEATH, INCOMPETENCE, BANKRUPTCY, DISSOLUTION OR WITHDRAWAL OF A
LIMITED PARTNER. The death, Total Disability, bankruptcy, dissolution,
retirement, resignation or withdrawal of a Limited Partner or the occurrence of
any other event that causes a Limited Partner to cease to be a Partner of the
Partnership shall not in and of itself dissolve or terminate the Partnership;
and the Partnership, notwithstanding such event, shall continue without
dissolution upon the terms and conditions provided in this Agreement, and each
Limited Partner, by executing this Agreement, agrees to such continuation of the
Partnership without dissolution.
SECTION 13
DISSOLUTION AND TERMINATION OF PARTNERSHIP
13.1 DISSOLUTION. (a) There shall be a dissolution of the Partnership
and its affairs shall be wound up upon the first to occur of any of the
following events:
(i) the date of the dissolution of the Institutional Fund; or
(ii) the expiration of the Term as provided in Section 1.4; or
(iii) the last Business Day of the Fiscal Year in which all
assets acquired, or agreed to be acquired, by the Partnership have been
sold or otherwise disposed of; or
(iv) a decision by the General Partner in its sole discretion
to dissolve the Partnership because it has determined that due to a
change in the text, application or interpretation of the provisions of
any applicable law (including, without limitation, changes that result
in the Partnership being taxable as a corporation under the Code),
there is a substantial likelihood that the Partnership will be unable
to effectively carry out its investment program or otherwise operate in
the manner contemplated by this Agreement; or
26
(v) the withdrawal, bankruptcy or dissolution and commencement
of winding-up of the General Partner, or the assignment by the General
Partner of its entire interest in the Partnership, or the occurrence of
any other event that causes the General Partner to cease to be a
general partner of the Partnership under the Partnership Law, UNLESS
(i) at the time of the occurrence of such event there is at least one
remaining general partner of the Partnership that is hereby authorized
to and does (unanimously in the case of more than one general partner)
elect to continue the business of the Partnership without dissolution
or (ii) the business of the Partnership is otherwise continued without
dissolution pursuant to the provisions of the Partnership Law, PROVIDED
that, for the purposes of this Section 13.1, the conversion of the
General Partner to a limited partnership, limited liability company or
other entity, or the Transfer of the General Partner's interest as the
general partner of the Partnership to, or the merger of the General
Partner with and into, a limited partnership, limited liability company
or other entity as provided for in Section 11.5 shall not, for the
purposes of this Section 13.1 be deemed a dissolution or winding-up or
commencement of winding-up of the General Partner.
13.2 DISTRIBUTION UPON DISSOLUTION. Upon the dissolution of the
Partnership, the General Partner (or, if dissolution of the Partnership should
occur by reason of Section 13.1(c), a duly elected liquidating trustee of the
Partnership or other representative who may be designated by a Majority in
Interest) shall proceed, subject to the provisions of this Section 13, to
liquidate the Partnership and apply the proceeds of such liquidation, or in its
sole discretion to distribute Partnership assets, in the following order of
priority:
FIRST, to creditors in satisfaction of debts and liabilities
of the Partnership, whether by payment or the making of reasonable
provision for payment (other than any loans or advances that may have
been made by any of the Partners to the Partnership), and the expenses
of liquidation whether by payment or the making of reasonable provision
for payment, any such reasonable reserves (which may be funded by a
liquidating trust) to be established by the General Partner (or any
liquidating trustee selected by the General Partner, or if the General
Partner has dissolved or withdraws from the Partnership, or other
representative duly designated by the Manager or by MMC) in amounts
deemed by it to be reasonably necessary for the payment of the
Partnership's expenses, liabilities and other obligations (whether
fixed or contingent, conditional or unmatured);
SECOND, to the Partners in satisfaction of any loans or
advances that may have been made by any of the Partners to the
Partnership, whether by payment or the making of reasonable provision
for payment;
THIRD, to the Partners in accordance with Section 6.
27
13.3 DISTRIBUTIONS IN CASH OR IN KIND. Upon the dissolution of the
Partnership, the General Partner (or liquidating trustee selected by the General
Partner or, if the General Partner has dissolved or withdraws from the
Partnership, a representative duly designated by the Manager or by MMC) or its
successor or other representative shall use its commercially reasonable efforts
to liquidate all of the Partnership assets in an orderly manner and apply the
proceeds of such liquidation as set forth in Section 13.2, PROVIDED THAT if in
the good faith business judgment of the General Partner (or such liquidating
trustee or other representative), a Partnership asset should not be liquidated,
the General Partner (or such other representative) shall allocate, on the basis
of the Value of any Partnership assets not sold or otherwise disposed of, any
unrealized gain or loss based on such Value to the Partner's Capital Accounts as
though the assets in question had been sold on the date of distribution and,
after giving effect to any such adjustment, distribute said assets in accordance
with Section 13.2, subject to the priorities set forth in Section 13.2, PROVIDED
FURTHER that the General Partner (such other representative) shall in good faith
attempt to liquidate sufficient Partnership assets to satisfy in cash (or make
reasonable provision for) the debts and liabilities referred to in paragraphs
First and Second of Section 13.2. The General Partner may cause certificates
evidencing any Securities to be distributed to be imprinted with legends as to
such restrictions on transfers that it may deem necessary or appropriate,
including, without limitation, legends as to applicable federal or state or
non-U.S. securities laws or other legal or contractual restrictions, and may
require any Partner to which Securities are to be distributed to agree in
writing (A) that such Securities shall not be transferred except in compliance
with such restrictions and (B) to such other matters as the General Partner may
deem necessary, appropriate convenient or incidental to the foregoing.
13.4 TIME FOR LIQUIDATION, ETC. (a) At the end of the term of the
Partnership as provided for in Section 1.4, the Partnership shall be liquidated
and any remaining assets shall be distributed in accordance with Section 13.2. A
reasonable time period shall be allowed for the orderly winding-up and
liquidation of the assets of the Partnership and the discharge of liabilities to
creditors so as to enable the General Partner to seek to minimize potential
losses upon such liquidation. Subject to Section 13.1, the provisions of this
Agreement shall remain in full force and effect during the period of winding-up
and until the filing of a notice of dissolution of the Partnership with the
Registrar of Exempted Limited Partnerships of the Cayman Islands, as provided in
13.4(b).
(b) FILING OF NOTICE OF DISSOLUTION. Upon completion of the
foregoing, the General Partner shall execute, acknowledge and file or
cause to be filed a notice of dissolution of the Partnership with the
Registrar of Exempted Limited Partnerships of the Cayman Islands.
13.5 GENERAL PARTNER AND MEMBERS OF MMC NOT PERSONALLY LIABLE FOR
RETURN OF CAPITAL CONTRIBUTIONS. None of the General Partner, the Manager, or
any member of MMC or any of its or their respective Affiliates shall be
personally liable for the return of all or any portion of the Capital Accounts
or the Capital Contributions of any Partner, and such return shall be made
solely from available Partnership assets, if any, and each Limited Partner
hereby waives any and all claims it may have against the General
28
Partner, the Manager and the members of MMC or any of its or their respective
Affiliates in this regard.
13.6 REORGANIZATION OF THE PARTNERSHIP. To the extent permitted by law,
in order to effect a reorganization of the Partnership:
(a) the General Partner may cause the conversion of the
Partnership to a limited partnership, limited liability company or
other entity formed under the laws of the Cayman Islands or any other
jurisdiction, or
(b) the General Partner may cause the exchange of the
interests of the Partners in the Partnership for interests in, or cause
the Partnership to be merged with and into, a limited partnership,
limited liability company or other entity formed under the laws of the
Cayman Islands or any other jurisdiction,
but only if in any such case the Partners (including, without limitation, their
successors) shall become, and no other Persons (other than Persons necessary for
the qualification of such limited partnership, limited liability company or
other entity under such laws) shall be, the partners of such limited
partnership, the members of such limited liability company or the equity holders
of such other entity, as the case may be, PROVIDED that no such conversion,
exchange or merger shall be permitted unless
(i) the General Partner shall first have delivered to
the Partnership
(A) a written opinion from Debevoise &
Xxxxxxxx or other counsel of recognized standing
experienced in United States federal income tax
matters, to the effect that such limited partnership,
limited liability company or other entity shall be
classified as a partnership, and shall not be treated
as a corporation, for United States federal income
tax purposes, and
(B) a written opinion (the conclusions of
which may be based in part on the opinion specified
in the immediately preceding clause (A)) of each of
(1) experienced counsel admitted to
practice in each jurisdiction in which such
limited partnership, limited liability
company or other entity is formed or has an
office and
(2) experienced counsel admitted to
practice in each jurisdiction (X) in which
such limited partnership, limited liability
company or other entity shall have an
office, be doing business or otherwise be
subject to the income tax laws of such
jurisdiction immediately after such
conversion, exchange or merger and (y) under
the income tax laws of which the Partnership
was not taxed directly on
29
its income before such conversion, exchange
or merger,
to the effect that such conversion, exchange or merger would not cause
such limited partnership, limited liability company or other entity to
be taxed directly on its income under the income tax laws of such
jurisdiction,
(ii) the General Partner shall have first delivered
to the Partnership a written opinion of experienced counsel
admitted to practice in the jurisdiction under the laws of
which such limited partnership, limited liability company or
other entity is formed, to the effect that such conversion,
exchange or merger would not adversely affect the limited
liability of the Limited Partners,
(iii) such conversion, exchange or merger would not
result in the violation of any applicable securities laws,
(iv) such conversion, exchange or merger would not
result in such limited partnership, limited liability company
or other entity being required to register as an investment
company under the Investment Company Act or any law of similar
import of the jurisdiction under the laws of which such
limited partnership, limited liability company or other entity
is formed, and would not result in the General Partner or any
Affiliate of the General Partner being required to register as
an investment adviser under the Investment Advisers Act or any
law of similar import of such jurisdiction, and
(v) the General Partner shall have made a good faith
determination that such conversion, exchange or merger would
not adversely affect the rights or increase the liabilities of
the Limited Partners.
Upon any such conversion, exchange or merger, such limited partnership, limited
liability company or other entity shall be treated as the successor to the
Partnership for all purposes of this Agreement and of the corresponding
agreement pursuant to which the rights and obligations of the partners of such
limited partnership, the members of such limited liability company or the equity
holders of such other entity, as the case may be, are determined. All
Subscription Agreements applicable to the Partnership that are in effect at the
time of any such conversion, exchange or merger shall thereafter continue in
full force and effect, and shall apply to a limited partnership, limited
liability company or other entity that becomes the successor to the Partnership
pursuant to such conversion, exchange or merger. In conjunction with any such
conversion, exchange or merger, the General Partner may execute, on behalf of
the Partnership and each of the Limited Partners, all documents that in its
reasonable judgment are necessary or appropriate to consummate such conversion,
exchange or merger, including, but not limited to, the agreement pursuant to
which the rights and obligations of the partners of such limited partnership,
the members of such limited liability company or the equity holders of such
other entity, as the case may be, are determined (in the case of such a
conversion to,
30
exchange for interests in or merger into a limited partnership, including the
limited partnership agreement thereof), all without any further consent or
approval of any other Partner, PROVIDED that no such agreement may directly or
indirectly effectuate a modification or amendment of the rights and obligations
of the Partners which, if such modification or amendment were made to this
Agreement, would require the consent of the Partners, any group thereof or any
individual Partner as provided in Section 15, unless the consent to such
modification or amendment required under Section 15 is obtained. A
reorganization of the Partnership pursuant to this Section 13.6 shall not be
deemed to be or result in a dissolution, winding-up or commencement of
winding-up of the Partnership.
SECTION 14
DEFINITIONS
As used herein the following terms have the meaning set forth below:
"ADDITIONAL LIMITED PARTNER" shall have the meaning set forth in
Section 11.2(a).
"ADJUSTMENT DATE" shall mean the last day of each Fiscal Year or any
other date determined by the General Partner, in its sole discretion, as
appropriate for an interim closing of the Partnership's books.
"AFFILIATE" shall mean, with respect to any specified Person, a Person
that directly or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with, the Person specified, PROVIDED
that Portfolio Companies and any Person controlled by a Portfolio Company shall
not be an "Affiliate" of the Partnership, the General Partner, the Manager, MMC
or any Covered Person and PROVIDED FURTHER that an "Affiliate" of the General
Partner shall include any principal, employee, consultant or director of either
the General Partner or the Manager.
"AGREEMENT" shall have the meaning set forth in the initial paragraph
of this Agreement.
"ANNUAL MEETING" shall have the meaning set forth in Section 9.4.
"APPLICABLE FEDERAL RATE" shall mean the annual Short-Term Applicable
Federal Rate published from time to time by the United States Internal Revenue
Service.
"AVAILABLE ASSETS" shall mean as of any date, the excess of the cash,
cash equivalent items and Temporary Investments held by the Partnership over the
sum of the amount of such items determined by the General Partner in its sole
discretion to be reasonably necessary for the payment of the Partnership's
expenses, liabilities and other obligations (whether fixed, contingent,
conditional or unmatured), including the Partnership's indemnification
obligations, and the conduct of the Partnership's investment program, and for
the establishment of appropriate reserves for such expenses, liabilities and
obligations and investment program.
31
"AVAILABLE CAPITAL COMMITMENT" shall mean, in respect of any Partner,
the amount of such Partner's Capital Commitment that has not been used to fund
Portfolio Investments.
"BRIDGE FINANCING" shall mean any interim financing provided by the
Partnership in order to facilitate a Portfolio Investment, which financing is
disposed of by the Partnership by the end of the 12-month period beginning on
the date such financing was made. (For the avoidance of doubt, any Bridge
Financing that is not disposed of by the Partnership by the end of such 12-month
period shall be deemed to have been a Portfolio Investment from the date it was
made.)
"BUSINESS DAY" shall mean any day on which banks located in New York
City are not required or authorized by law to remain closed.
"CAPITAL ACCOUNT" shall have the meaning set forth in Section 6.1.
"CAPITAL COMMITMENT" shall mean the commitments of the Partners to
contribute capital pursuant to Section 5.1.
"CAPITAL CONTRIBUTION" shall mean, with respect to any Partner, the
amount of capital contributed, or to be contributed, as the case may be, and
pursuant to a single Drawdown or in the aggregate, as the context may require,
by such Partner to the Partnership pursuant to Section 5.1 and the other
provisions of this Agreement.
"CLAIMS" shall have the meaning set forth in Section 10.1.
"CLOSING" shall have the meaning set forth in the Subscription
Agreements.
"CLOSING DATE" shall mean any date upon which the Partnership allows
subscriptions to the Partnership to be made.
"CODE" shall mean the United States Internal Revenue Code of 1986, as
amended.
"COVERED PERSON" shall mean (i) the General Partner and the Manager,
(ii) each of the respective Affiliates of each Person identified in clause (i)
of this definition and (iii) each Person who at any time was or is a
shareholder, officer, director, employee, partner, member, manager, consultant
or agent of any of the Persons identified in clause (i) or clause (ii) of this
definition.
"DAMAGES" shall have the meaning set forth in Section 10.1.
"DEFAULT" shall have the meaning set forth in Section 5.2.
"DEFAULTING PARTNER" shall have the meaning set forth in Section 5.2.
"DISABLING CONDUCT" shall mean conduct that constitutes Gross
Negligence or willful misfeasance of the duties involved in the conduct of the
office of the Person referred to.
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"DISTRIBUTABLE CASH" shall mean shall mean the excess of (A) cash
received by the Partnership from the sale or other disposition of, or dividends
or interest income from, a Bridge Financing, Temporary Investment or Portfolio
Investment, or otherwise received by the Partnership, other than Capital
Contributions, over (B) cash disbursements for expenses of the Partnership (or
amounts reserved against liabilities, contingent or otherwise, or other
obligations of the Partnership, including to pay organizational or ongoing
expenses of the Partnership).
"DRAWDOWN NOTICE" shall have the meaning set forth in Section 5.1(b).
"DRAWDOWNS" shall mean the Capital Contributions made to the
Partnership pursuant to Section 5.1 from time to time by the Partners pursuant
to the Drawdown Notice.
"ELIGIBLE EMPLOYEE" shall have the meaning set forth in the
Subscription Agreements.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated thereunder.
"FISCAL YEAR" shall mean the fiscal year of the Partnership, as
determined pursuant to Section 1.5.
"GENERAL PARTNER" shall mean MMC GP III, Inc., a Delaware corporation,
or its assignee and any additional or successor General Partner of the
Partnership in its capacity as the General Partner of the Partnership as such
entity may be affected by the provisions of Section 11.5.
"GOVERNMENTAL AUTHORITY" shall mean any United States federal, state or
local, or any Cayman Islands or other non-U.S. court, arbitrator or governmental
agency, authority, commission, instrumentality or regulatory or administrative
body.
"GROSS NEGLIGENCE" shall mean "gross negligence" as interpreted in
accordance with the laws of the State of Delaware (notwithstanding the
provisions of Section 16.7 of this Agreement).
"INITIAL AGREEMENT" shall have the meaning set forth in the initial
paragraph of this Agreement.
"INITIAL LIMITED PARTNER" shall mean Xxxxx X. Xxxxxxx, Esq.
"INSTITUTIONAL FUND" shall have the meaning set forth in Section 1.3.
"INSTITUTIONAL FUND AGREEMENT" shall mean the Amended and Restated
Limited Partnership Agreement of the Institutional Fund, as amended and/or
restated from time to time.
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"INVESTMENT ADVISERS ACT" shall mean the United States Investment
Advisers Act of 1940, as amended.
"INVESTMENT COMPANY ACT" shall mean the United States Investment
Company Act of 1940, as amended.
"LIMITED PARTNER" shall have the meaning set forth in Section 1.1.
"MAJORITY IN INTEREST" shall mean Limited Partners who, at the time in
question, have Capital Contributions aggregating more than 50% of the aggregate
Capital Contributions of the Partners.
"MANAGER" shall mean MMC Capital, Inc., a Delaware corporation, or any
successor thereto.
"MATERIAL ADVERSE EFFECT" shall mean (A) a violation of a statute,
rule, regulation or governmental administrative policy applicable to a Partner
of a U.S. federal, state or non-U.S. Governmental Authority which could have a
material adverse effect on a Portfolio Company or any Affiliate thereof or on
the Partnership or the General Partner, or any of their respective Affiliates or
(b) an occurrence which could subject a Portfolio Company or Affiliate thereof
or the Partnership, the General Partner or the Manager, or any of their
respective Affiliates to any material regulatory requirement to which it would
not otherwise be subject, or which could materially increase any such regulatory
requirement beyond what it would otherwise have been.
"MEMORANDUM" shall mean the Confidential Private Placement Memorandum
of the Partnership and any supplements thereto.
"MMC" shall mean Xxxxx & McLennan Companies, Inc., and, as the context
requires, its subsidiaries and Affiliates, including Xxxxx Inc., Mercer Inc. and
Xxxxxx Investments LLC.
"OTHER FUNDS" shall have the meaning set forth in Section 2.5.
"PARALLEL FUNDS" shall have the meaning set forth in Section 1.3.
"PARTNERS" shall have the meaning set forth in Section 1.1.
"PARTNERSHIP" shall have the meaning set forth in the initial paragraph
of this Agreement.
"PARTNERSHIP LAW" shall mean the Exempted Limited Partnership Law (2003
Revision) of the Cayman Islands, as amended, and any successor to such statute.
"PERIOD" shall mean, for the first period, the period commencing on the
date of this Agreement and ending on the next Adjustment Date, and thereafter
the period commencing on the day after an Adjustment Date and ending on the next
Adjustment Date.
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"PERMITTED TRANSFEREE" shall mean the General Partner or any Affiliate
of the General Partner (other than any natural person).
"PERSON" shall mean any individual, entity, corporation, partnership,
association, limited liability company, limited liability partnership,
joint-stock company, trust or unincorporated organization.
"PORTFOLIO COMPANY" shall mean an entity in which a Portfolio
Investment is made by the Partnership directly or through one or more
intermediate entities of the Partnership.
"PORTFOLIO INVESTMENT" shall mean any debt or equity (or debt with
equity) investment (other than any Bridge Financing) made by the Partnership
pursuant to Section 4.1.
"POWER OF ATTORNEY" shall mean, with respect to any Limited Partner,
the Power of Attorney executed by such Limited Partner substantially in the form
attached to the Subscription Agreements.
"PRIME RATE" shall mean the rate of interest publicly announced by
JPMorgan Chase Bank from time to time in New York, New York as its prime rate.
"PROCEEDING" shall have the meaning set forth in Section 10.1.
"REGISTER OF PARTNERSHIP INTERESTS" shall have the meaning set forth in
Section 8.2(a).
"REMAINING CAPITAL COMMITMENT" shall mean, in respect of any Partner,
the amount of such Partner's Capital Commitment, determined at any date and
subject to Section 4.1(b), eligible to be drawn by the Partnership as a Capital
Contribution.
"SEC" shall mean the United States Securities and Exchange Commission.
"SECTION 17 TRANSACTIONS" shall have the meaning set forth in Section
2.5(d).
"SECURITIES" shall mean shares of capital stock, limited partnership
interests, limited liability company interests, warrants, options, bonds, notes,
debentures and other equity and debt securities and interests of whatever kind
of any Person, whether readily marketable or not.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the SEC promulgated thereunder.
"SHARING PERCENTAGE" shall mean with respect to any Partner and any
Bridge Financing, Temporary Investment or Portfolio Investment, a fraction,
expressed as a percentage, the numerator of which is the aggregate amount of the
Capital Contributions of such Partner used to fund the cost of such financing or
investment and the denominator
35
of which is the aggregate amount of the Capital Contributions of all of the
Partners used to fund the cost of such financing or investment.
"SPECIAL INVESTMENT VEHICLE" shall have the meaning set forth in
Section 4.2.
"STATEMENT" shall have the meaning set forth in Section 1.4.
"SUBSCRIPTION AGREEMENTS" shall mean the several Subscription
Agreements entered into by the respective Limited Partners in connection with
their purchase of limited partner interests in the Partnership.
"TEMPORARY INVESTMENTS" shall mean investments in (A) cash equivalents,
(B) marketable direct obligations issued or unconditionally guaranteed by the
United States of America, or issued by any agency thereof, maturing within one
year from the date of acquisition thereof, (C) money market instruments,
commercial paper or other short-term debt obligations having at the date of
purchase by the Partnership the highest or second highest rating obtainable from
either Standard & Poor's Corporation or Xxxxx'x Investors Service, Inc. or their
successors, (D) money market mutual funds managed by Xxxxxx Investments LLC or a
subsidiary thereof, (E) interest-bearing accounts and/or certificates of deposit
maturing within one year from the date of acquisition thereof issued by
commercial banks incorporated under the laws of the United States of America or
any state thereof or the District of Columbia, each having at the date of
acquisition by the Partnership undivided capital and surplus of not less than
$100,000,000, (F) overnight repurchase agreements with primary Fed dealers
collateralized by direct United States Government obligations or (G) pooled
investment vehicles or accounts which invest only in Securities or instruments
of the type described in (a) through (d). If there exists any uncertainty as to
whether any investment by the Partnership constitutes a Temporary Investment or
Portfolio Investment, such investment shall be deemed a Temporary Investment
unless the General Partner determines in its sole discretion that such
investment is a Portfolio Investment.
"TERM" shall have the meaning set forth in Section 1.4.
"TRANSFER" shall mean a direct or indirect transfer in any form,
including a sale, assignment, conveyance, pledge, mortgage, encumbrance,
securitization, hypothecation or other disposition or purported severance or
alienation of any beneficial interest (including the creation of any derivative
or synthetic interest) in the Partnership, or the act of so doing, as the
context requires.
"TREASURY REGULATIONS" shall mean the Regulations of the Treasury
Department of the United States issued pursuant to the Code.
"VALUE" shall have the meaning set forth in Section 9.5.
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SECTION 15
AMENDMENTS
This Agreement may be modified, amended or restated at any time and
from time to time with the written consent of (A) the General Partner and (B) a
Majority in Interest of Limited Partners, PROVIDED that, without the consent of
any of the Partners, the General Partner may (i) amend this Agreement or take
any other action as permitted or contemplated by the Powers of Attorney, (ii)
reflect on the records of the Partnership changes validly made, pursuant to the
terms of this Agreement, in the amount of (and the obligation to fund the full
amount of) the Capital Commitment of any Partner or in the membership of the
Partnership, (iii) enter into agreements with any Permitted Transferee acquiring
an interest in the Partnership, (iv) amend this Agreement as may be required to
implement (A) Transfers of interests of Limited Partners, (B) the admission of
any Additional Limited Partner, (C) any admission of Limited Partners or changes
in Capital Commitments contemplated by Section 11.2, (D) any changes due to a
Defaulting Partner, (E) the conversion, Transfer or merger of all or any part of
its interest as general partner of the Partnership as contemplated by Section
11.5 or (F) a reorganization of the Partnership as contemplated by Section 13.6;
and (V) may amend this Agreement (A) to satisfy any requirements, conditions,
guidelines or opinions contained in any opinion, directive, order, ruling or
regulation of the SEC, the United States Internal Revenue Service or any other
U.S. federal or state agency, or in any federal or state statute, compliance
with which the General Partner deems to be in the best interests of the
Partnership, (B) to change the name of the Partnership and (C) to cure any
ambiguity or correct or supplement any provision of this Agreement that may be
incomplete or inconsistent with any other provision contained herein, so long as
such amendment under clause (C) of this clause (v) does not adversely affect the
interests of the Limited Partners hereunder, and PROVIDED FURTHER that no
amendment of this Agreement (X) shall increase or extend any financial
obligation or liability of a Limited Partner beyond that set forth herein or
permitted hereby without such adversely affected Limited Partner's consent, or
(Y) materially and adversely affect the rights of a Limited Partner in a manner
that discriminates against such Limited Partner vis-a-vis the other Limited
Partners without the written consent of such Limited Partner. Any modifications
or amendments duly adopted in accordance with the terms of this Agreement may be
executed in accordance with the Powers of Attorney.
SECTION 16
MISCELLANEOUS PROVISIONS
16.1 NOTICES. All notices and other communications required or
permitted to be given under this Agreement shall be in writing and shall be
transmitted by (A) registered or certified mail, return receipt requested,
postage prepaid, (B) hand delivery service prepaid, (C) next day or overnight
mail or delivery, in each case postage or service prepaid, (d) email or (E)
telecopy or facsimile, addressed as follows:
37
(a) if to the General Partner or to the Partnership, to it at:
c/o MMC Capital, Inc.
00 Xxxxxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxx Xxxxxxx
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
Email: XXxxxxxx@XXXXxxxxxx.xxx
(b) if to a Limited Partner, to such Limited Partner at any of
the home, office or email address of such Limited Partner.
All such notices, requests, demands, waivers and other communications shall be
deemed to have been received (V) if by email, on the day immediately following
the day upon which such email was transmitted, (W) if by personal delivery, on
the day after such delivery, (X) if by certified or registered mail, on the
fifth business day after the mailing thereof, (Y) if by next-day or overnight
mail or delivery, one day after the mailing thereof, or (Z) if by facsimile, on
the day immediately following the day on which such facsimile was sent, PROVIDED
that a copy is also sent by certified or registered mail.
16.2 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be considered an original and all of which
taken together shall constitute a single agreement.
16.3 TABLE OF CONTENTS AND HEADINGS. The table of contents and the
headings of the sections of this Agreement are inserted for convenience of
reference only and shall not be deemed to alter or affect the meaning or
interpretation of any provision hereof.
16.4 SUCCESSORS AND ASSIGNS. Except as otherwise specifically provided
herein, this Agreement shall inure to the benefit of and be binding upon the
parties and to their respective heirs, executors, administrators, successors and
permitted assigns.
16.5 SEVERABILITY. Every term and provision of this Agreement is
intended to be severable. If any term or provision hereof is illegal or invalid
for any reason whatsoever, such term or provision shall be enforced to the
maximum extent permitted by applicable law and, in any event, such illegality or
invalidity shall not affect the validity of the remainder of the Agreement. Any
default hereunder by a Limited Partner shall not excuse a default by any other
Limited Partner.
16.6 NON-WAIVER. No provision of this Agreement shall be deemed to have
been waived except if the giving of such waiver is contained in a written notice
given to the party claiming such waiver and no such waiver shall be deemed to be
a waiver of any other or further obligation or liability of the party or parties
in whose favor the waiver was given.
38
16.7 APPLICABLE LAW (SUBMISSION TO JURISDICTION). EXCEPT AS PROVIDED IN
THE DEFINITION OF "GROSS NEGLIGENCE", THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HERETO SHALL BE INTERPRETED AND ENFORCED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE CAYMAN ISLANDS. The General
Partner hereby submits to the nonexclusive jurisdiction of the courts of the
Cayman Islands and to the courts of the jurisdiction in which the principal
office of the Partnership is located (and, if the principal office is located in
the United States, of the federal district court having jurisdiction over the
location of the principal office) for the resolution of all matters pertaining
to the enforcement and interpretation of this Agreement.
16.8 CONFIDENTIALITY. Each Limited Partner agrees that it shall not
disclose without the prior consent of the General Partner (other than to such
Limited Partner's employees, auditors or counsel, PROVIDED that such Limited
Partner obtain the agreement of such Person to be bound by the obligations of
this Section 16.8) any information with respect to the Partnership or any
Portfolio Company that is designated by the General Partner to such Limited
Partner in writing as confidential, PROVIDED that a Limited Partner may disclose
any such information (A) as has become generally available to the public, (B) as
may be required or appropriate in any report, statement or testimony submitted
to any Governmental Authority having jurisdiction over such Limited Partner, or
to the National Association of Insurance Commissioners or similar organizations
and their successors, (C) as may be required or appropriate in response to any
summons or subpoena or in connection with any litigation, (D) to the extent
necessary in order to comply with any law, order, regulation, ruling or other
governmental request applicable to such Limited Partner, (E) to its professional
advisors and (f) that constitutes United States federal income tax treatment or
tax structure of the Partnership (including transactions undertaken by the
Partnership) and all materials of any kind (including opinions or other tax
analyses) that are provided to such Limited Partner relating to such tax
treatment and tax structure, PROVIDED that, prior to the final Closing of the
Partnership, Limited Partners may not disclose the name of (or any other similar
identifying information, including the names of any employees, affiliates or
investments regarding) the Partnership, the General Partner or the Portfolio
Investments (other than their status for United States federal income tax
purposes), except to their tax advisors or to a regulatory authority as required
by law. Notwithstanding anything in this Agreement to the contrary, the General
Partner shall have the right to keep confidential from Limited Partners for such
a period of time as the General Partner deems reasonable, any information that
the General Partner reasonably believes to be in the nature of trade secrets or
other information the disclosure of which the General Partner in good faith
believes is not in the best interest of the Partnership or could damage the
Partnership or its business or that the Partnership is required by law or by
agreement with a third Person to keep confidential.
16.9 SURVIVAL OF CERTAIN PROVISIONS. The obligations of each Partner
pursuant to Section 6.10(d) and Section 10 shall survive the termination or
expiration of this Agreement and the dissolution, winding-up and termination of
the Partnership.
39
16.10 WAIVER OF PARTITION. Except as may otherwise be provided by law
in connection with the winding-up, liquidation and dissolution of the
Partnership, each Partner hereby irrevocably waives any and all rights that it
may have to maintain an action for partition of any of the Partnership's
property.
16.11 CURRENCY. The term "dollar" and the symbol"$", wherever used in
this Agreement, shall mean the United States dollar.
16.12 ENTIRE AGREEMENT. This Agreement (including, without limitation,
all schedules hereto) and the Subscription Agreements constitute the entire
agreement among the Partners, among the Partners and the Initial Limited Partner
and between the Partnership and the Manager with respect to the subject matter
hereof and thereof, and supersede any prior agreement or understanding among or
between them with respect to such subject matter.
40
IN WITNESS WHEREOF, the undersigned have duly executed this Amended and
Restated Limited Partnership Agreement of the Trident III ESC, L.P. on the day
and year first above written.
GENERAL PARTNER:
---------------
MMC GP III, INC.
By:
-------------------------------
Name:
Title:
LIMITED PARTNERS:
----------------
Each of the Limited Partners listed
on the register of Partnership
interests maintained at the
registered office of the
Partnership, pursuant to the power
of attorney and authorization
granted by each such Limited Partner
to the General Partner as
attorney-in-fact and agent under the
separate Powers of Attorney, dated
various dates:
By: MMC GP III, INC.
By:
---------------------------------
Name:
Title:
INITIAL LIMITED PARTNER:
-----------------------
MANAGER:
For the purpose of accepting the
appointment contained in Section 7
only.
MMC Capital, Inc.
By:
---------------------------------
Name:
Title:
41
