UNITED STATES NATURAL GAS FUND, LP SECOND AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
Exhibit
3.1
SECOND
AMENDED AND RESTATED
This Second Amended and Restated
Agreement of Limited Partnership (this “Agreement”) executed on
December 4, 2007, is entered into by and among Victoria Bay Asset Management,
LLC, a Delaware limited liability company, as General Partner, Xxxxxxxxxx
Holdings, Inc., a Delaware corporation, as the Organizational Limited Partner,
and Xxxxxxx Capital Group, LLC as a Limited Partner, together with any Persons
who shall hereafter be admitted as Partners in accordance with this
Agreement.
WHEREAS, the General Partner,
Xxxxxxxxxx Holdings, Inc., a Delaware corporation, as the Organizational Limited
Partner, and the Initial Limited Partner are parties to that certain amended and
restated agreement of limited partnership executed on April 17, 2007
(the “LP Agreement”),
regarding the operation of the Partnership and their rights and obligations
thereunder and pursuant to which the Organizational Limited Partner withdrew
from the Partnership;
ARTICLE
1
As used
in this Agreement, the following terms shall have the following
meanings:
1.1 “Accounting Period” shall
mean the following periods: the initial accounting period which shall commence
upon the commencement of operations of the Partnership. Each subsequent
Accounting Period shall commence immediately after the close of the preceding
Accounting Period. Each Accounting Period hereunder shall close on the earliest
of (i) the last Business Day of a month, (ii) the effective date of dissolution
of the Partnership, and (iii) such other day or days in addition thereto or in
substitution therefore as may from time to time be determined by the General
Partner in its discretion either in any particular case or
generally.
1.2 “Act” shall mean the Revised
Uniform Limited Partnership Act of the State of Delaware, as amended from time
to time.
1.3 “Additional Limited Partner”
shall mean a Person admitted to the Partnership as a Limited Partner pursuant to
this Agreement and who is shown as such on the books and records of the
Partnership.
1.4 “Affiliate” shall mean, when
used with reference to a specified Person, (i) any Person who directly or
indirectly through one or more intermediaries controls or is controlled by or is
under common control with the specified Person or (ii) any Person that is an
officer of, partner in, or trustee of, or serves in a similar capacity with
respect to, the specified Person or of which the specified Person is an officer,
partner or trustee, or with respect to which the specified Person serves in a
similar capacity.
1.5 “Assignee” shall mean a
Record Holder that has not been admitted to the Partnership as a Substituted
Limited Partner.
1.6 “Agreement” shall mean this
Second Amended and Restated Agreement of Limited Partnership as may
be amended, modified, supplemented or restated from time to
time.
1.7 “Authorized Purchaser
Agreement” shall mean an agreement among the Partnership, the General
Partner and a Participant, as may be amended or supplemented from time to time
in accordance with its terms.
1.8 “Business Day” shall mean any
day other than a day on which the American Stock Exchange, the New York
Mercantile Exchange or the New York Stock Exchange is closed for regular
trading.
1.9 “Beneficial Owner” shall mean
the ultimate beneficial owner of Units held by a nominee which has furnished the
identity of the Beneficial Owner in accordance with Section 6031(c) of the Code
(or any other method acceptable to the General Partner in its sole discretion)
and with Section 9.2.2 of this Agreement.
1.10 “Capital Account” shall have
the meaning assigned to such term in Section 4.1.
1.11 “Capital Contribution” shall
mean the total amount of money or agreed-upon value of property contributed to
the Partnership by all the Partners or any class of Partners or any one Partner,
as the case may be (or the predecessor holders of the interests of such Partner
or Partners).
1.12 “Capital Transaction” shall
mean a sale of all or substantially all of the assets of the Partnership not in
the ordinary course of business.
1.13 “Certificate” shall mean a
certificate issued by the Partnership evidencing ownership of one or more
Units.
1.14 “Close of Business” shall
mean 5:00 PM New York time.
1.15 “Creation Basket” shall mean
100,000 Units, or such other number of Units as may be determined by the General
Partner from time to time, purchased by a Participant.
1.16 “Code” shall mean the
Internal Revenue Code of 1986, as amended.
1.17 “Departing Partner” shall
mean a former General Partner, from and after the effective date of any
withdrawal or removal of such former General Partner.
1.18 “Depository” or “DTC” shall mean The
Depository Trust Company, New York, New York, or such other depository of Units
as may be selected by the General Partner as specified herein.
1.19 “Depository Agreement” shall
mean the Letter of Representations from the General Partner to the Depository,
dated as of April 17, 2007, as may be amended or supplemented from time to
time.
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1.20 “Distributable Cash” shall
mean, with respect to any period, all cash revenues of the Partnership (not
including (i) Capital Contributions, (ii) funds received by the Partnership in
respect of indebtedness incurred by the Partnership, (iii) interest or other
income earned on temporary investments of Partnership funds pending utilization,
and (iv) proceeds from any Capital Transaction), less the sum of the following:
(x) all amounts expended by the Partnership pursuant to this Agreement in such
period and (y) such working capital or reserves or other amounts as the General
Partner reasonably deems to be necessary or appropriate for the proper operation
of the Partnership’s business or its winding up and liquidation. The General
Partner in its sole discretion may from time to time declare other funds of the
Partnership to be Distributable Cash.
1.21 “DTC Participants” shall have
the meaning assigned to such term in Section 9.2.2.
1.22 “General Partner” shall mean
Victoria Bay Asset Management, LLC, a Delaware limited liability company, or any
Person who, at the time of reference thereto, serves as a general partner of the
Partnership.
1.23 “Global Certificates” shall
mean the global certificate or certificates issued to the Depository as provided
in the Depository Agreement, each of which shall be in substantially the form
attached hereto as Exhibit B.
1.24 “Indirect Participants” shall
have the meaning assigned to such term in Section 9.2.2.
1.25 “Initial Limited Partner”
shall have the meaning assigned to such term in Section 3.3.
1.26 “Initial Offering Period”
shall mean the period commencing with the initial effective date of the
Prospectus and terminating no later than the ninetieth (90th) day following such
date unless extended for up to an additional 90 days at the sole discretion of
the General Partner.
1.27 “Limited Partner” shall mean
any Person who is a limited partner (whether the Initial Limited Partner, a
Limited Partner admitted pursuant to this Agreement or an assignee who is
admitted as a Limited Partner) at the time of reference thereto, in such
Person’s capacity as a limited partner of the Partnership.
1.28 “Management Fee” shall mean
the management fee paid to the General Partner pursuant to this
Agreement.
1.29 “Net Asset Value” or “NAV” shall mean the current
market value of the Partnership’s total assets, less any liabilities, as
reasonably determined by the General Partner or its designee.
1.30 “Opinion of Counsel” shall
mean a written opinion of counsel (who may be regular counsel to the Partnership
or the General Partner) acceptable to the General Partner.
1.31 “Organizational Limited
Partner” shall mean Xxxxxxxxxx Holdings, Inc., a Delaware corporation, in
its capacity as the organizational limited partner of the
Partnership.
1.32 “Outstanding” shall mean,
with respect to the Units or other Partnership Securities, as the case may be,
all Units or other Partnership Securities that are issued by the Partnership and
reflected as outstanding on the Partnership’s books and records as of the date
of determination.
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1.33 “Participant” shall mean a
Person that is a DTC Participant and has entered into an Authorized Purchaser
Agreement which, at the relevant time, is in full force and effect.
1.34 “Partner” shall mean the
General Partner or any Limited Partner. “Partners” shall mean the
General Partner and all Limited Partners (unless otherwise
indicated).
1.35 “Partnership” shall mean the
limited partnership hereby formed, as such limited partnership may from time to
time be constituted.
1.36 “Partnership Securities”
shall mean any additional Units, options, rights, warrants or appreciation
rights relating thereto, or any other type of equity security that the
Partnership may lawfully issue, any unsecured or secured debt obligations of the
Partnership or debt obligations of the Partnership convertible into any class or
series of equity securities of the Partnership.
1.37 “Person” shall mean any
natural person, partnership, limited partnership, limited liability company,
trust, estate, corporation, association, custodian, nominee or any other
individual or entity in its own or any representative capacity.
1.38 “Profit or Loss” with respect
to any Accounting Period shall mean the excess (if any) of:
(a) the
Net Asset Value as of the Valuation Time on the Valuation Date,
less
(b) the
Net Asset Value as of the Valuation Time on the Valuation Date immediately
preceding the commencement of such Accounting Period,
adjusted
as deemed appropriate by the General Partner to reflect any Capital
Contributions, redemptions, withdrawals, distributions, or other events
occurring or accounted for during such Accounting Period (including any
allocation of Profit or Loss to a redeeming partner pursuant to Article 4.3.2
with respect to such Accounting Period).
If the
amount determined pursuant to the preceding sentence is a positive number, such
amount shall be the “Profit” for the Accounting
Period and if such amount is a negative number, such amount shall be the “Loss” for the Accounting
Period.
1.39 “Prospectus” shall mean the
United States Natural Gas Fund, LP prospectus, dated April 17, 2007,
as the same may have been amended or supplemented, used in connection with the
offer and sale of Units in the Partnership.
1.40 “Record Date” shall mean the
date established by the General Partner for determining (a) the identity of
Limited Partners (or Assignees if applicable) entitled to notice of, or to vote
at any meeting of Limited Partners or entitled to vote by ballot or give
approval of any Partnership action in writing without a meeting or entitled to
exercise rights in respect of any action of Limited Partners or (b) the identity
of Record Holders entitled to receive any report or distribution.
1.41 “Record Holder” shall mean
the Person in whose name such Unit is registered on the books of the Transfer
Agent as of the open of business on a particular Business Day.
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1.42 “Redeemable Units” shall mean
any Units for which a redemption notice has been given.
1.43 “Redemption Basket” shall
mean 100,000 Units or such other number of Units as may be determined by the
General Partner from time to time, redeemed by a Participant.
1.44 “Revolving Credit Facility”
shall mean a revolving credit facility that the Partnership may enter into on
behalf of the Partnership with one or more commercial banks or other lenders for
liquidity or other purposes for the benefit of the Partnership.
1.45 “Substituted Limited Partner”
shall mean a Person who is admitted as a Limited Partner to the Partnership
pursuant to Article 11.2 in place of and with all the rights of a Limited
Partner and who is shown as a Limited Partner on the books and records of the
Partnership.
1.46 “Tax Certificate” shall mean
an Internal Revenue Service Form W-9 (or the substantial equivalent thereof) in
the case of a Limited Partner that is a U.S. person within the meaning of the
Code, or an Internal Revenue Service Form W-8BEN or other applicable form in the
case of a Limited Partner that is not a U.S. person.
1.47 “Transfer Agent” shall mean
Xxxxx Brothers Xxxxxxxx & Co. or such bank, trust company or other Person
(including, without limitation, the General Partner or one of its Affiliates) as
shall be appointed from time to time by the Partnership to act as registrar and
transfer agent for the Units or any applicable Partnership
Securities.
1.48 “Transfer Application” shall
mean an application and agreement for transfer of Units, which shall be
substantially in the form attached hereto as Exhibit D.
1.49 “Unit” shall mean an interest
of a Limited Partner or an assignee of the Partnership representing such
fractional part of the interests of all Limited Partners and assignees as shall
be determined by the General Partner pursuant to this Agreement.
1.50 “Unit Register” shall have
the meaning assigned to such term in Article 9.2.1.
1.51 “Unitholders” shall mean the
General Partner and all holders of Units, where no distinction is required by
the context in which the term is used.
1.52 “Valuation Date” shall mean
the last Business Day of any Accounting Period.
1.53 “Valuation Time” shall mean
(i) Close of Business on a Valuation Date or (ii) such other time or day as the
General Partner in its discretion may determine from time to time either in any
particular case or generally.
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ARTICLE
2
2.1 This
Agreement shall become effective on the date set forth in the preamble of this
Agreement. The rights and liabilities of the Partners shall be as set
forth in the Act, except as herein otherwise expressly provided. The
Partnership shall continue without interruption as a limited partnership
pursuant to the provisions of the Act.
2.2 The
name of the Partnership shall be United States Natural Gas Fund, LP; however,
the business of the Partnership may be conducted, upon compliance with all
applicable laws, under any other name designated in writing by the General
Partner to the Limited Partners.
2.3 The
Partnership’s principal place of business shall be located at 0000 Xxxxxx Xxx
Xxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxxxx 00000 or such other place as the General
Partner may designate from time to time. The registered agent for the
Partnership is Corporation Service Company and the registered office is located
at 0000 Xxxxxxxxxxx Xxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxxx 00000, County of New
Castle. The Partnership may maintain such other offices at such other places as
the General Partner deems advisable.
2.4 The
investment objective of the Partnership is for changes in percentage terms of
the Units’ NAV to reflect the changes in percentage terms of the spot price of
natural gas delivered at the Xxxxx Hub in Louisiana, as measured by the
“Benchmark Futures Contract, less the Partnership’s expenses. It is
not the intent of the Partnership to be operated in such a fashion such that its
NAV will equal, in dollar terms, the dollar price of spot natural gas or any
particular futures contract based on natural gas. The Partnership will invest in
futures contracts for natural gas, other types of natural gas, heating oil,
gasoline, oil and other petroleum based fuels that are traded on the New York
Mercantile Exchange, ICE Futures or other U.S. and foreign exchanges
(collectively, “ Natural Gas
Futures Contracts”) and other natural gas interests such as cash-settled
options on Natural Gas Futures Contracts, forward contracts for natural gas,
oil, and over-the-counter transactions that are based on the price of natural
gas, other petroleum-based fuels, Natural Gas Futures Contracts and indices
based on the foregoing .
2.5 The
term of the Partnership shall be from the date of its formation in perpetuity,
unless earlier terminated in accordance with the terms of this
Agreement.
2.6 The
General Partner shall execute, file and publish all such certificates, notices,
statements or other instruments required by law for the formation or operation
of a limited partnership in all jurisdictions where the Partnership may elect to
do business. The General Partner shall not be required to deliver or mail to the
Limited Partners a copy of the certificate of limited partnership of the
Partnership or any certificate of amendment thereto.
2.7 The
Partnership shall be empowered to do any and all acts and things necessary,
appropriate, proper, advisable, incidental to or convenient for the furtherance
and accomplishment of the purposes, business, protection and benefit of the
Partnership.
2.8 The
business and affairs of the Partnership shall be managed by the General Partner
in accordance with Article 7 hereof. The General Partner has seven
directors, a majority of whom may also be executive officers of the General
Partner. The General Partner shall establish and maintain an audit committee of
its board of directors for the Partnership (the “Audit Committee”) in
compliance with, and granted the requisite authority and funding pursuant to,
any applicable (1) federal securities laws and regulations, including the
Xxxxxxxx-Xxxxx Act of 2002, and (2) rules, policies and procedures of any
national securities exchange on which the securities issued by the Partnership
are listed and traded.
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ARTICLE
3
Partners
and Capital Contributions
3.1 General Partner.
3.1.1 The
name of the General Partner is Victoria Bay Asset Management, LLC, which
maintains its principal business office at 0000 Xxxxxx Xxx Xxxxxxx, Xxxxx 000,
Xxxxxxx, Xxxxxxxxxx 00000.
3.1.2 In
consideration of management and administrative services rendered by the General
Partner, the Partnership shall pay the Management Fee to the General Partner (or
such other person or entity designated by the General Partner) including the
payment of expenses in the ordinary course of business. Expenses in the
“ordinary course of business” shall not include the payment of (i)
brokerage fees, (ii) licensing fees for the use of intellectual property used by
the Partnership, or (iii) registration or other fees paid to the Securities and
Exchange Commission (“SEC”), the Financial Industry Regulatory Authority
(“FINRA”), or any other regulatory agency in connection with the offer and sale
of the Units and all legal, accounting, printing and other expenses
associated therewith; provided, however, that the fees and expenses incurred
under (iii) in connection with the initial public offering of the Units shall be
paid by the General Partner. The Partnership also pays (i) the fees and
expenses, including directors and officers’ liability insurance, of the
independent directors, and (ii) the fees and expenses associated with its tax
accounting and reporting requirements with the exception of any fees for
implementation of services and base service fees charged by the accounting firm
responsible for preparing the Partnership’s tax reporting forms, as such fees
will be paid by the General Partner. Fees and expenses, including the
Management Fee, are calculated on a daily basis and paid on a monthly basis
(accrued at 1/365 of applicable percentage of NAV on that day). The initial
Management Fee shall be set forth on Exhibit A attached hereto, as may be
amended from time to time. The General Partner may, in its sole discretion,
waive all or part of the Management Fee. The Partnership shall be responsible
for all extraordinary expenses (i.e., expenses not in the ordinary course of
business, including, without limitation, the items listed above in this Section
3.1.2, the indemnification of any Person against liabilities and obligations to
the extent permitted by law and required under this Agreement and the bringing
and defending of actions at law or in equity and otherwise engaging in the
conduct of litigation and the incurring of legal expense and the settlement of
claims and litigation).
3.1.3 In
connection with the formation of the Partnership under the Act, the General
Partner acquired a 2% interest in the profits and losses of the Partnership and
made an initial capital contribution to the Partnership in the amount of $20.00,
and the Organizational Limited Partner acquired a 98% interest in the profits
and losses of the Partnership and made an initial capital contribution to the
Partnership in the amount of $980.00. As of the date of the initial offering of
Units to the public, the interest of the Organizational Limited Partner and the
General Partner was redeemed, the initial capital contribution of the
Organizational Limited Partner and the General Partner was refunded, and the
Organizational Limited Partner thereupon withdrew and ceased to be a Limited
Partner. Ninety-eight percent of any interest or other profit that may have
resulted from the investment or other use of such initial capital contribution
was allocated and distributed to the Organizational Limited Partner, and the
balance thereof was allocated and distributed to the General
Partner. The General Partner may but shall not be
required to make Capital Contributions to the Partnership on or after the date
hereof. If the General Partner does make a Capital Contribution to the
Partnership on or after the date hereof, it shall be issued Units based on the
same terms and conditions applicable to the purchase of a Creation Basket under
Article 16 hereof.
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3.1.4 The
General Partner may not, without written approval by all of the Limited Partners
or by other written instrument executed and delivered by all of the Limited
Partners subsequent to the date of this Agreement, take any action in
contravention of this Agreement, including, without limitation, (i) any act that
would make it impossible to carry on the ordinary business of the Partnership,
except as otherwise provided in this Agreement; (ii) possess Partnership
property, or assign any rights in specific Partnership property, for other than
a Partnership purpose; (iii) admit a Person as a Partner, except as otherwise
provided in this Agreement; (iv) amend this Agreement in any manner, except as
otherwise provided in this Agreement or under applicable law; or (v) transfer
its interest as general partner of the Partnership, except as otherwise provided
in this Agreement.
3.1.5 Except
as otherwise provided herein, the General Partner may not sell, exchange or
otherwise dispose of all or substantially all of the Partnership’s assets in a
single transaction or a series of related transactions (including by way of
merger, consolidation or other combination with any other Person) or approve on
behalf of the Partnership the sale, exchange or other disposition of all or
substantially all of the assets of the Partnership, taken as a whole, without
the approval of at least a majority of the Limited Partners; provided, however,
that this provision shall not preclude or limit the General Partner’s ability to
mortgage, pledge, hypothecate or grant a security interest in all or
substantially all of the Partnership’s assets and shall not apply to any forced
sale of any or all of the Partnership’s assets pursuant to the foreclosure of,
or other realization upon, any such encumbrance.
3.1.6 Unless
approved by a majority of the Limited Partners, the General Partner shall not
take any action or refuse to take any reasonable action the effect of which, if
taken or not taken, as the case may be, would be to cause the Partnership, to
the extent it would materially and adversely affect the Limited Partners, to be
taxable as a corporation for federal income tax purposes.
3.1.7 Notwithstanding
any other provision of this Agreement, the General Partner is not authorized to
institute or initiate on behalf of, or otherwise cause the Partnership
to:
(a) make
a general assignment for the benefit of creditors;
(b) file
a voluntary bankruptcy petition; or
(c) file
a petition seeking for the Partnership a reorganization, arrangement,
composition, readjustment liquidation, dissolution or similar relief under any
law.
3.2 Issuance of
Units. Units in the Partnership will only be issued in a
Creation Basket or whole number multiples thereof.
3.3 Initial Limited
Partner. The name of the Initial Limited Partner is Xxxxxxx
Capital Group, LLC (“Initial
Limited Partner”). The business address and Capital Contribution of the
Initial Limited Partner are 00 Xxxxxxxx Xxx Xxxx, XX 00000. The Initial Limited
Partner shall purchase the initial Creation Basket at an initial offering price
per Unit equal to the closing price of near-month Natural Gas Futures Contracts
as listed on the New York Mercantile Exchange on the last Business Day prior to
the effective date of the registration statement relating to the
Prospectus.
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3.4 Capital
Contribution. Except as otherwise provided in this Agreement,
no Partner shall have any right to demand or receive the return of its Capital
Contribution to the Partnership. No Partner shall be entitled to interest on any
Capital Contribution to the Partnership or on such Partner’s Capital
Account.
ARTICLE
4
(i)
credited with the amount of any Capital Contributions made by such Partner
during such Accounting Period;
(ii)
credited with any allocation of Profit made to such Partner for such Accounting
Period;
(iii)
debited with any allocation of Loss made to such Partners for such Accounting
Period; and
(iv)
debited with the amount of cash paid to such Partner as an amount withdrawn or
distributed to such Partner during such Accounting Period, or, in the case of
any payment of a withdrawal or distribution in kind, the fair value of the
property paid or distributed during such Accounting Period.
4.1.1 For
any Accounting Period in which Units are issued or redeemed for cash or other
property, the General Partner shall, in accordance with Treasury Regulation
Section 1.704-1(b)(2)(iv)(f), adjust the Capital Accounts of all Partners and
the carrying value of each Partnership asset upward or downward to reflect any
unrealized gain or unrealized loss attributable to each such Partnership asset,
as if such unrealized gain or unrealized loss had been recognized on an actual
sale of the asset and had been allocated to the Partners at such time pursuant
to Article 4.2 of this Agreement in the same manner as any item of gain or loss
actually recognized during such period would have been allocated.
4.1.2 To
the extent an adjustment to the adjusted tax basis of any Partnership asset
pursuant to Section 734(b) or 743(b) of the Code is required, pursuant to
Treasury Regulation Section 1.704-1(b)(2)(iv)(m), to be taken into account in
determining Capital Accounts, the amount of such adjustment to the Capital
Accounts shall be treated as an item of gain (if the adjustment increases the
basis of the asset) or loss (if the adjustment decreases such basis), and such
item of gain or loss shall be specially allocated to the Partners in a manner
consistent with the manner in which their Capital Accounts are required to be
adjusted pursuant to such Section of the Treasury regulations.
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4.3.1 Except
as otherwise provided in this Agreement, for each fiscal year of the
Partnership, items of income, deduction, gain, loss, and credit recognized by
the Partnership for federal income tax purposes shall be allocated among the
Partners in a manner that equitably reflects the amounts credited or debited to
each Partner’s Capital Account for each Accounting Period during such fiscal
year. Allocations under this Article 4.3 shall be made by the General Partner in
accordance with the principles of Sections 704(b) and 704(c) of the Code and in
conformity with applicable Treasury regulations promulgated thereunder
(including, without limitation, Treasury regulations Sections
1.704-1(b)(2)(iv)(f), 1.704-1(b)(4)(i), and 1.704-3(e)).
4.3.2 Notwithstanding
anything else contained in this Article 4, if any Partner has a deficit Capital
Account for any Accounting Period as a result of any adjustment of the type
described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(5) or
1.704-1(b)(2)(ii)(d)(6), then the Partnership’s income and gain shall be
specially allocated to such Partner in an amount and manner sufficient to
eliminate such deficit as quickly as possible. Any special allocation of items
of income or gain pursuant to this Article 4.3.2 shall be taken into account in
computing subsequent allocations pursuant to this Article 4 so that the
cumulative net amount of all items allocated to each Partner shall, to the
extent possible, be equal to the amount that would have been allocated to such
Partner if there had never been any allocation pursuant to the first sentence of
this Article 4.3.2.
4.3.3 Allocations
that would otherwise be made to a Limited Partner under the provisions of this
Article 4 shall instead be made to the Beneficial Owner of Units held by a
nominee.
ARTICLE
5
10
(i)
financial statements of the Partnership, including, without limitation, a
balance sheet as of the end of the Partnership’s fiscal year and statements of
income, Partners’ equity and changes in financial position, for such fiscal
year, which shall be prepared in accordance with generally accepted accounting
principles consistently applied and shall be audited by a firm of independent
certified public accountants registered with the Public Company Accounting
Oversight Board,
(ii) a
general description of the activities of the Partnership during the period
covered by the report, and
(iii) a
report of any material transactions between the Partnership and the General
Partner or any of its Affiliates, including fees or compensation paid by the
Partnership and the services performed by the General Partner or any such
Affiliate for such fees or compensation.
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ARTICLE
6
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ARTICLE
7
Rights
and Duties of the General Partner
7.1 Management
Power. The General Partner shall have exclusive management and
control of the business and affairs of the Partnership, and all decisions
regarding the management and affairs of the Partnership shall be made by the
General Partner. The General Partner shall have all the rights and powers of
general partner as provided in the Act and as otherwise provided by law. Except
as otherwise expressly provided in this Agreement, the General Partner is hereby
granted the right, power and authority to do on behalf of the Partnership all
things which, in its sole judgment, are necessary, proper or desirable to carry
out the aforementioned duties and responsibilities, including but not limited
to, the right, power and authority from time to time to do the
following:
(a) the
making of any expenditures, the lending or borrowing of money, the assumption or
guarantee of, or other contracting for, indebtedness and other liabilities, the
issuance of evidences of indebtedness and the incurring of any other obligations
and the securing of same by mortgage, deed of trust or other lien or
encumbrance;
(b) the
making of tax, regulatory and other filings, or rendering of periodic or other
reports to governmental or other agencies having jurisdiction over the business
or assets of the Partnership;
(c) the
acquisition, disposition, mortgage, pledge, encumbrance, hypothecation or
exchange of any or all of the assets of the Partnership, or the merger or other
combination of the Partnership with or into another Person (the matters
described in this clause (c) being subject, however, to any prior approval that
may be required in accordance with this Agreement);
(d) the
use of the assets of the Partnership (including, without limitation, cash on
hand) for any purpose consistent with the terms of this Agreement including,
without limitation, the financing of the conduct of the operations of the
Partnership, the lending of funds to other Persons, and the repayment of
obligations of the Partnership;
(e) the
negotiation, execution and performance of any contracts, conveyances or other
instruments (including, without limitation, instruments that limit the liability
of the Partnership under contractual arrangements to all or particular assets of
the Partnership with the other party to the contract to have no recourse against
the General Partner or its assets other than its interest in the Partnership,
even if same results in the terms of the transaction being less favorable to the
Partnership than would otherwise be the case);
(f) the
distribution of Distributable Cash;
(g) the
selection and dismissal of employees (including, without limitation, employees
having titles such as “president,” “vice president,”
“secretary” and “treasurer”), agents, outside
attorneys, accountants, consultants and contractors and the determination of
their compensation and other terms of employment or hiring;
(h) the
maintenance of insurance for the benefit of the Partners and the Partnership
(including, without limitation, the assets and operations of the
Partnership);
(i) the
formation of, or acquisition of an interest in, and the contribution of property
to, any further limited or general partnerships, joint ventures or other
relationships;
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(j) the
control of any matters affecting the rights and obligations of the Partnership,
including, without limitation, the bringing and defending of actions at law or
in equity and otherwise engaging in the conduct of litigation and the incurring
of legal expense and the settlement of claims and litigation;
(k) the
indemnification of any Person against liabilities and contingencies to the
extent permitted by law;
(l) the
entering into of listing agreements with the American Stock Exchange and any
other securities exchange and the delisting of some or all of the Units from, or
requesting that trading be suspended on, any such exchange; and
(m) the
purchase, sale or other acquisition or disposition of Units.
7.2 Best Efforts. The
General Partner will use its best efforts to cause the Partnership to be formed,
reformed, qualified or registered under assumed or fictitious name statutes or
similar laws in any state in which the Partnership owns property or transacts
business if such formation, reformation, qualification or registration is
necessary in order to protect the limited liability of the Limited Partners or
to permit the Partnership lawfully to own property or transact
business.
7.3 Right of Public to Rely on Authority
of a General Partner. No person shall be required to determine
the General Partner’s authority to make any undertaking on behalf of the
Partnership.
7.4 Obligation of the General
Partner. The General Partner shall:
(a) devote
to the Partnership and apply to the accomplishment of the Partnership purposes
so much of its time and attention as is necessary or advisable to manage
properly the affairs of the Partnership;
(b) maintain
the Capital Account for each Partner; and
(c) cause
the Partnership to enter into and carry out the obligations of the Partnership
contained in the agreements with Affiliates of the General Partner as described
in the Prospectus and cause the Partnership not to take any action in violation
of such agreements.
7.5 Good Faith. The
General Partner has a responsibility to the Limited Partners to exercise good
faith and fairness in all dealings. In the event that a Limited Partner believes
that the General Partner has violated its fiduciary duty to the Limited
Partners, he may seek legal relief individually or on behalf of the Partnership
under applicable laws, including under the Act and under securities and
commodities laws, to recover damages from or require an accounting by the
General Partner. Limited Partners should be aware that performance by the
General Partner of its fiduciary duty is measured by the terms of this Agreement
as well as applicable law. Limited Partners may also have the right, subject to
applicable procedural and jurisdictional requirements, to bring class actions in
federal court to enforce their rights under the federal securities laws and the
rules and regulations promulgated thereunder by the SEC. Limited Partners who
have suffered losses in connection with the purchase or sale of the Units may be
able to recover such losses from the General Partner where the losses result
from a violation by the General Partner of the federal securities laws. State
securities laws may also provide certain remedies to limited partners. Limited
Partners are afforded certain rights to institute reparations proceedings under
the Commodity Exchange Act for violations of the Commodity Exchange Act or of
any rule, regulation or order of the Commodities Futures Trading Commission
(“CFTC”) by
the General Partner.
14
7.6 Indemnification
7.6.1 Notwithstanding
any other provision of this Agreement, neither a General Partner nor any
employee or other agent of the Partnership nor any officer, director,
stockholder, partner, employee or agent of a General Partner (a “Protected Person”) shall be
liable to any Partner or the Partnership for any mistake of judgment or for any
action or inaction taken, nor for any losses due to any mistake of judgment or
to any action or inaction or to the negligence, dishonesty or bad faith of any
officer, director, stockholder, partner, employee or agent of the Partnership or
any officer, director, stockholder, partner, employee or agent of such General
Partner, provided that such officer, director, stockholder, partner, employee or
agent of the Partner or officer, director, stockholder, partner, employee or
agent of such General Partner was selected, engaged or retained by such General
Partner with reasonable care, except with respect to any matter as to which such
General Partner shall have been finally adjudicated in any action, suit or other
proceeding not to have acted in good faith in the reasonable belief that such
Protected Person’s action was in the best interests of the Partnership and
except that no Protected Person shall be relieved of any liability to which such
Protected Person would otherwise be subject by reason of willful misfeasance,
gross negligence or reckless disregard of the duties involved in the conduct of
the Protected Person’s office. A General Partner and its officers, directors,
employees or partners may consult with counsel and accountants (except for the
Partnership’s independent auditors) in respect of Partnership affairs and be
fully protected and justified in any action or inaction which is taken in
accordance with the advice or opinion of such counsel or accountants (except for
the Partnership’s independent auditors), provided that they shall have been
selected with reasonable care.
Notwithstanding
any of the foregoing to the contrary, the provisions of this Article 7.6.1 and
of Article 7.6.2 hereof shall not be construed so as to relieve (or attempt to
relieve) a General Partner (or any officer, director, stockholder, partner,
employee or agent of such General Partner) of any liability to the extent (but
only to the extent) that such liability may not be waived, modified or limited
under applicable law, but shall be construed so as to effectuate the provisions
of this Article 7.6.1 and of Article 7.6.2 hereof to the fullest extent
permitted by law.
7.6.2 The
Partnership shall, to the fullest extent permitted by law, but only out of
Partnership assets, indemnify and hold harmless a General Partner and each
officer, director, stockholder, partner, employee or agent thereof (including
persons who serve at the Partnership’s request as directors, officers or
trustees of another organization in which the Partnership has an interest as a
Unitholder, creditor or otherwise) and their respective legal representatives
and successors (hereinafter referred to as a “Covered Person”) against all
liabilities and expenses, including but not limited to amounts paid in
satisfaction of judgments, in compromise or as fines and penalties, and counsel
fees reasonably incurred by any Covered Person in connection with the defense or
disposition of any action, suit or other proceedings, whether civil or criminal,
before any court or administrative or legislative body, in which such Covered
Person may be or may have been involved as a party or otherwise or with which
such Covered Person may be or may have been threatened, while in office or
thereafter, by reason of an alleged act or omission as a General Partner or
director or officer thereof, or by reason of its being or having been such a
General Partner, director or officer, except with respect to any matter as to
which such Covered Person shall have been finally adjudicated in any such
action, suit or other proceeding not to have acted in good faith in the
reasonable belief that such Covered Person’s action was in the best interest of
the Partnership, and except that no Covered Person shall be indemnified against
any liability to the Partnership or Limited Partners to which such Covered
Person would otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of
such Covered Person’s office. Expenses, including counsel fees so incurred by
any such Covered Person, may be paid from time to time by the Partnership in
advance of the final disposition of any such action, suit or proceeding on the
condition that the amounts so paid shall be repaid to the Partnership if it is
ultimately determined that the indemnification of such expenses is not
authorized hereunder.
15
As to any
matter disposed of by a compromise payment by any such Covered Person, pursuant
to a consent decree or otherwise, no such indemnification either for said
payment or for any other expenses shall be provided unless such compromise shall
be approved as in the best interests of the Partnership, after notice that it
involved such indemnification by any disinterested person or persons to whom the
questions may be referred by the General Partner, provided that there has been
obtained an opinion in writing of independent legal counsel to the effect that
such Covered Person appears to have acted in good faith in the reasonable belief
that his or her action was in the best interests of the Partnership and that
such indemnification would not protect such persons against any liability to the
Partnership or its Limited Partners to which such person would otherwise by
subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of office. Approval by
any disinterested person or persons shall not prevent the recovery from persons
of indemnification if such Covered Person is subsequently adjudicated by a court
of competent jurisdiction not to have acted in good faith in the reasonable
belief that such Covered Person’s action was in the best interests of the
Partnership or to have been liable to the Partnership or its Limited Partners by
reason of willful misfeasance, bad faith, gross negligence or reckless disregard
of the duties involved in the conduct of such Covered Person’s
office.
The right
of indemnification hereby provided shall not be exclusive of or affect any other
rights to which any such Covered Person may be entitled. As used in this Article
7.6.2, an “interested Covered
Person” is one against whom the action, suit or other proceeding on the
same or similar grounds is then or has been pending and a “disinterested person” is a
person against whom no actions, suits or other proceedings or another action,
suit or other proceeding on the same or similar grounds is then or has been
pending. Nothing contained in this Article 7.6.2 shall affect any rights to
indemnification to which personnel of a General Partner, other than directors
and officers, and other persons may be entitled by contract or otherwise under
law, nor the power of the Partnership to purchase and maintain liability
insurance on behalf of any such person.
Nothing
in this Article 7.6.2 shall be construed to subject any Covered Person to any
liability to which he or she is not already liable under this Agreement or
applicable law.
7.6.3 Each
Limited Partner agrees that it will not hold any Affiliate or any officer,
director, stockholder, partner, employee or agent of any Affiliate of the
General Partner liable for any actions of such General Partner or any
obligations arising under or in connection with this Agreement or the
transactions contemplated hereby.
7.7 Resolutions of Conflicts of
Interest; Standard of Care.
7.7.1 Unless
otherwise expressly provided in this Agreement or any other agreement
contemplated hereby, whenever a conflict of interest exists or arises between
the General Partner on the one hand, and the Partnership or any Limited Partner,
on the other hand, any resolution or course of action by the General Partner in
respect of such conflict of interest shall be permitted and deemed approved by
all Partners and shall not constitute a breach of this Agreement or of any
agreement contemplated hereby or of a duty stated or implied by law or equity,
if the resolution or course of action is, or by operation of this Agreement is
deemed to be, fair and reasonable to the Partnership. If a dispute arises, it
will be resolved through negotiations with the General Partner or by a court
located in the State of Delaware. Any resolution of a dispute is deemed to be
fair and reasonable to the Partnership if the resolution is:
16
approved
by the Audit Committee, although no party is obligated to seek such approval and
the General Partner may adopt a resolution or course of action that has not
received such approval;
on terms
no less favorable to the Limited Partners than those generally being provided to
or available from unrelated third parties; or
fair to the Limited Partners, taking
into account the totality of the relationships of the parties involved including
other
transactions that may be particularly favorable or advantageous to the Limited
Partners.
7.7.2 Whenever
this Agreement or any other agreement contemplated hereby provides that the
General Partner is permitted or required to make a decision (i) in its
discretion or under a grant of similar authority or latitude, the General
Partner shall be entitled to the extent permitted by applicable law, to consider
only such interest and factors as it desires and shall have no duty or
obligation to give any consideration to any interest of or factors affecting the
partnership or the Limited Partners, or (ii) in its good faith or under another
express standard, the General Partner shall act under such express standard and
except as required by applicable law, shall not be subject to any other
different standards imposed by this Agreement, any other agreement contemplated
hereby or applicable law.
7.8 Other Matters Concerning the General
Partner.
7.8.1 The
General Partner (including the Audit Committee) may rely on and shall be
protected in acting or refraining from acting upon any certificate, document or
other instrument believed by it to be genuine and to have been signed or
presented by the proper party or parties.
7.8.2 The
General Partner (including the Audit Committee) may consult with legal counsel,
accountants, appraisers, management consultants, investment bankers and other
consultants and advisors selected by it and any opinion or advice of any such
person as to matters which the General Partner (including the Audit Committee)
believes to be within such person’s professional or expert competence shall be
the basis for full and complete authorization of indemnification and provide
legal protection with respect to any action taken or suffered or omitted by the
General Partner (including the Audit Committee) hereunder in good faith and in
accordance with such opinion or advice.
7.8.3 The
General Partner (including the Audit Committee) may exercise any of the powers
granted to it by this Agreement and perform any of the duties imposed upon it
hereunder either directly or by or through its agents, and the General Partner
(including the Audit Committee) shall not be responsible for any misconduct or
negligence on the part of any such agent appointed by the General Partner in
good faith.
7.9 Other Business
Ventures. Any Partner, director, employee, Affiliate or other
person holding a legal or beneficial interest in any entity which is a Partner,
may engage in or possess an interest in other business ventures of every nature
and description, independently or with others, whether such ventures are
competitive with the Partnership or otherwise; and, neither the Partnership nor
the Partners shall have any right by virtue of this Agreement in or to such
independent ventures or to the income or profits derived there
from.
17
7.10 Contracts with the General Partner
or its Affiliates. The General Partner may, on behalf of the
Partnership, enter into contracts with any Affiliate. The validity of any
transaction, agreement or payment involving the Partnership and any General
Partner or any Affiliate of a General Partner otherwise permitted by the terms
of this Agreement shall not be affected by reason of (i) the relationship
between the Partnership and the Affiliate of the General Partner, or (ii) the
approval of said transaction agreement or payment by officers or directors of
the General Partner.
7.11 Additional General
Partners. Additional general partners may be admitted with the
consent of the General Partner.
ARTICLE
8
(a) In
addition to other rights provided by this Agreement or by applicable law, and
except as otherwise limited under this Agreement, each Limited Partner shall
have the right, for a purpose reasonably related to such Limited Partner’s
interest as a Limited Partner in the Partnership, upon reasonable demand and at
such Limited Partner’s own expense:
18
(i) to
obtain true and full information regarding the status of the business and
financial condition of the Partnership;
(ii)
promptly after becoming available, to obtain a copy of the Partnership’s
federal, state and local tax returns for each year;
(iii) to
have furnished to it, upon notification to the General Partner, a current list
of the name and last known business, residence or mailing address of each
Partner;
(iv) to
have furnished to it, upon notification to the General Partner, a copy of this
Agreement and the Certificate of Limited Partnership and all amendments
thereto;
(v) to
obtain true and full information regarding the amount of cash contributed by and
a description and statement of the value of any other Capital Contribution by
each Partner and which each Partner has agreed to contribute in the future, and
the date on which each became a Partner; and
(vi) to
obtain such other information regarding the affairs of the Partnership as is
just and reasonable.
(b)
Notwithstanding any other provision of this Agreement, the General Partner may
keep confidential from the Limited Partners and Assignees for such 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 interests of the Partnership or could damage the Partnership
or that the Partnership is required by law or by agreements with third parties
to keep confidential (other than agreements with Affiliates the primary purpose
of which is to circumvent the obligations set forth in this Article
8.6).
ARTICLE
9
9.2.1 The
General Partner shall cause to be kept on behalf of the Partnership a register
(the “Unit Register”)
in which, subject to such reasonable regulations as it may prescribe, the
General Partner will provide for the registration and the transfer of Units. The
Transfer Agent has been appointed registrar and transfer agent for the purpose
of registering and transferring Units as herein provided. The Partnership shall
not recognize transfers of Certificates representing Units unless same are
effected in the manner described in this Article 9.2. Upon surrender for
registration of transfer of any Units evidenced by a Certificate, the General
Partner on behalf of the Partnership will execute, and the Transfer Agent will
countersign and deliver, in the name of the holder or the designated transferee
or transferees, as required pursuant to the holder’s instructions, one or more
new Certificates evidencing the same aggregate number of Units as was evidenced
by the Certificate so surrendered.
19
(a) Global Certificate
Only. Unless otherwise authorized by the General Partner,
Certificates for Units will not be issued, other than the one or more Global
Certificates issued to the Depository. So long as the Depository Agreement is in
effect, Creation Baskets will be issued and redeemed and Units will be
transferable solely through the book-entry systems of the Depository and the DTC
Participants and their Indirect Participants as more fully described
below.
(1) Global
Certificate. The Partnership and the General Partner will
enter into the Depository Agreement pursuant to which the Depository will act as
securities depository for the Units. Units will be represented by the Global
Certificate (which may consist of one or more certificates as required by the
Depository), which will be registered, as the Depository shall direct, in the
name of Cede & Co., as nominee for the Depository and deposited with, or on
behalf of, the Depository. No other certificates evidencing Units will be
issued. The Global Certificate shall be in the form attached hereto as Exhibit B
and shall represent such Units as shall be specified therein, and may provide
that it shall represent the aggregate amount of outstanding Units from time to
time endorsed thereon and that the aggregate amount of outstanding Units
represented thereby may from time to time be increased or decreased to reflect
creations or redemptions of Baskets (as defined in Section 16.1). Any
endorsement of a Global Certificate to reflect the amount, or any increase or
decrease in the amount, of outstanding Units represented thereby shall be made
in such manner and upon instructions given by the General Partner on behalf of
the Partnership as specified in the Depository Agreement.
(2) Legend. Any Global
Certificate issued to the Depository or its nominee shall bear a legend
substantially to the following effect:
“UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE FUND OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE &
CO. OR TO SUCH OTHER ENTITY AS IS REQUIRED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO.,
HAS AN INTEREST HEREIN.”
(3) The
Depository. The Depository has advised the Partnership and the
General Partner as follows: the Depository is a limited-purpose trust company
organized under the laws of the State of New York, a member of the U.S. Federal
Reserve System, a “clearing
corporation” within the meaning of the New York Uniform Commercial Code,
and a “clearing agency”
registered pursuant to the provisions of Section 17A of the Securities Exchange
Act of 1934, as amended. The Depository was created to hold securities of DTC
Participants and to facilitate the clearance and settlement of securities
transactions among the DTC Participants in such securities through electronic
book-entry changes in accounts of the DTC Participants, thereby eliminating the
need for physical movement of securities certificates. “DTC Participants”
include securities brokers and dealers, banks, trust companies, clearing
corporations, and certain other organizations, some of whom (and/or their
representatives) own the Depository. Access to the Depository’s system is also
available to others such as banks, brokers, dealers and trust companies that
clear through or maintain a custodial relationship with a DTC Participant,
either directly or indirectly (“Indirect Participants”).
The Depository may determine to discontinue providing its service with respect
to Creation Baskets and Units by giving notice to the General Partner pursuant
to and in conformity with the provisions of the Depository Agreement and
discharging its responsibilities with respect thereto under applicable law.
Under such circumstances, the General Partner shall take action either to find a
replacement for the Depository to perform its functions at a comparable cost and
on terms acceptable to the General Partner or, if such a replacement is
unavailable, to terminate the Partnership.
20
(4) Beneficial
Owners. As provided in the Depository Agreement, upon the
settlement date of any creation, transfer or redemption of Units, the Depository
will credit or debit, on its book-entry registration and transfer system, the
number of Units so created, transferred or redeemed to the accounts of the
appropriate DTC Participants. The accounts to be credited and charged shall be
designated by the General Partner on behalf of the Partnership and each
Participant, in the case of a creation or redemption of Baskets. Ownership of
beneficial interest in Units will be limited to DTC Participants, Indirect
Participants and persons holding interests through DTC Participants and Indirect
Participants. Beneficial Owners will be shown on, and the transfer of beneficial
ownership by Beneficial Owners will be effected only through, in the case of DTC
Participants, records maintained by the Depository and, in the case of Indirect
Participants and Beneficial Owners holding through a DTC Participant or an
Indirect Participant, through those records or the records of the relevant DTC
Participants. Beneficial Owners are expected to receive, from or through the
broker or bank that maintains the account through which the Beneficial Owner has
purchased Units, a written confirmation relating to their purchase of
Units.
(5) Reliance on
Procedures. Except for those who have provided Transfer
Applications to the General Partner, so long as Cede & Co., as nominee of
the Depository, is the registered owner of Units, references herein to the
registered or record owners of Units shall mean Cede & Co. and shall not
mean the Beneficial Owners of Units. Beneficial Owners of Units will not be
entitled to have Units registered in their names, will not receive or be
entitled to receive physical delivery of certificates in definitive form and
will not be considered the record or registered holder of Units under this
Agreement. Accordingly, to exercise any rights of a holder of Units under the
Agreement, a Beneficial Owner must rely on the procedures of the Depository and,
if such Beneficial Owner is not a DTC Participant, on the procedures of each DTC
Participant or Indirect Participant through which such Beneficial Owner holds
its interests. The Partnership and the General Partner understand that under
existing industry practice, if the Partnership requests any action of a
Beneficial Owner, or a Beneficial Owner desires to take any action that the
Depository, as the record owner of all outstanding Units, is entitled to take,
the Depository will notify the DTC Participants regarding such request, such DTC
Participants will in turn notify each Indirect Participant holding Units through
it, with each successive Indirect Participant continuing to notify each person
holding Units through it until the request has reached the Beneficial Owner, and
in the case of a request or authorization to act that is being sought or given
by a Beneficial Owner, such request or authorization is given by the Beneficial
Owner and relayed back to the Partnership through each Indirect Participant and
DTC Participant through which the Beneficial Owner’s interest in the Units is
held.
(6) Communication between the
Partnership and the Beneficial Owners. As described above, the
Partnership will recognize the Depository or its nominee as the owner of all
Units for all purposes except as expressly set forth in this Agreement.
Conveyance of all notices, statements and other communications to Beneficial
Owners will be effected in accordance with this paragraph. Pursuant
to the Depository Agreement, the Depository is required to make available to the
Partnership, upon request and for a fee to be charged to the Partnership, a
listing of the Unit holdings of each DTC Participant. The Partnership shall
inquire of each such DTC Participant as to the number of Beneficial Owners
holding Units, directly or indirectly, through such DTC Participant. The
Partnership shall provide each such DTC Participant with sufficient copies of
such notice, statement or other communication, in such form, number and at such
place as such DTC Participant may reasonably request, in order that such notice,
statement or communication may be transmitted by such DTC Participant, directly
or indirectly, to such Beneficial Owners. In addition, the Partnership shall pay
to each such DTC Participant an amount as reimbursement for the expenses
attendant to such transmittal, all subject to applicable statutory and
regulatory requirements.
21
(7) Distributions. Distributions
on Units pursuant to this Agreement shall be made to the Depository or its
nominee, Cede & Co., as the registered owner of all Units. The Partnership
and the General Partner expect that the Depository or its nominee, upon receipt
of any payment of distributions in respect of Units, shall credit immediately
DTC Participants’ accounts with payments in amounts proportionate to their
respective beneficial interests in Units as shown on the records of the
Depository or its nominee. The Partnership and the General Partner also expect
that payments by DTC Participants to Indirect Participants and Beneficial Owners
held through such DTC Participants and Indirect Participants will be governed by
standing instructions and customary practices, as is now the case with
securities held for the accounts of customers in bearer form or registered in a
“street name,” and will
be the responsibility of such DTC Participants and Indirect Participants.
Neither the Partnership nor the General Partner will have any responsibility or
liability for any aspects of the records relating to or notices to Beneficial
Owners, or payments made on account of beneficial ownership interests in Units,
or for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests or for any other aspect of the relationship
between the Depository and the DTC Participants or the relationship between such
DTC Participants and the Indirect Participants and Beneficial Owners owning
through such DTC Participants or Indirect Participants or between or among the
Depository, any Beneficial Owner and any person by or through which such
Beneficial Owner is considered to own Units.
(8) Limitation of
Liability. The Global Certificate to be issued hereunder is
executed and delivered solely on behalf of the Partnership by the General
Partner in its capacity as such and in the exercise of the powers and authority
conferred and vested in it by this Agreement. The representations, undertakings
and agreements made on the part of the Partnership in the Global Certificate are
made and intended not as personal representations, undertakings and agreements
by the General Partner, but are made and intended for the purpose of binding
only the Partnership. Nothing in the Global Certificate shall be construed as
creating any liability on the General Partner, individually or personally, to
fulfill any representation, undertaking or agreement other than as provided in
this Agreement.
(9) Successor
Depository. If a successor to the Depository shall be employed
as Depository hereunder, the Partnership and the General Partner shall establish
procedures acceptable to such successor with respect to the matters addressed in
this Section 9.2.2.
(10)
Transfer of
Units. Beneficial Owners that are not DTC Participants may
transfer Units by instructing the DTC Participant or Indirect Participant
holding the Units for such Beneficial Owner in accordance with standard
securities industry practice. Beneficial Owners that are DTC Participants may
transfer Units by instructing the Depository in accordance with the rules of the
Depository and standard securities industry practice.
9.2.3 Except
as otherwise provided in this Agreement, the Partnership shall not recognize any
transfer of Units until the Certificates (if applicable) and a Transfer
Application have been provided to the General Partner evidencing such Units are
surrendered for registration of transfer. Such Certificates must be
accompanied by a Transfer Application duly executed by the transferee (or the
transferee’s attorney-in-fact duly authorized in writing). No charge shall be
imposed by the Partnership for such transfer, provided, that, as a condition to
the issuance of any new Certificate under this Article 9.2, the General Partner
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed with respect thereto.
22
9.3.1 If
any mutilated Certificate is surrendered to the Transfer Agent, the General
Partner on behalf of the Partnership, shall execute, and upon its request, the
Transfer Agent shall countersign and deliver in exchange therefore, a new
Certificate evidencing the same number of Units as the Certificate so
surrendered.
9.3.2 The
General Partner, on behalf of the Partnership, shall execute, and upon its
request, the Transfer Agent shall countersign and deliver a new Certificate in
place of any Certificate previously issued if the Record Holder of the
Certificate:
(a) makes
proof by affidavit, in form and substance satisfactory to the General Partner,
that a previously issued Certificate has been lost, destroyed or
stolen;
(b)
requests the issuance of a new Certificate before the Partnership has received
notice that the Certificate has been acquired by a purchaser for value in good
faith and without notice of an adverse claim;
(c) if
requested by the General Partner, delivers to the Partnership a bond or such
other form of security or indemnity as may be required by the General Partner,
in form and substance satisfactory to the General Partner, with surety or
sureties and with fixed or open penalty as the General Partner may direct, in
its sole discretion, to indemnify the Partnership, the General Partner and the
Transfer Agent against any claim that may be made on account of the alleged
loss, destruction or theft of the Certificate; and
(d)
satisfies any other reasonable requirements imposed by the General
Partner.
If a
Limited Partner or Assignee fails to notify the Partnership within a reasonable
time after it has notice of the loss, destruction or theft of a Certificate, and
a transfer of the Units represented by the Certificate is registered before the
Partnership, the General Partner or the Transfer Agent receives such
notification, the Limited Partner or Assignee shall be precluded from making any
claim against the Partnership, the General Partner or the Transfer Agent for
such transfer or for a new Certificate.
9.3.3 As
a condition to the issuance of any new Certificate under this Article 9.3, the
General Partner may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including, without limitation, the fees and expenses of the Transfer
Agent) connected therewith.
23
9.5.1 The General Partner shall do all things necessary to comply with the Act and is authorized and directed to do all things it deems to be necessary or advisable in connection with any future issuance of Partnership Securities, including, without limitation, compliance with any statute, rule, regulation or guideline of any federal, state or other governmental agency or any national securities exchange on which the Units or other Partnership Securities are listed for trading.
ARTICLE
10
10.1.1 The
term “transfer,” when
used in this Article 10 with respect to an interest, shall be deemed to refer to
an appropriate transaction by which the General Partner assigns its interest as
General Partner to another Person or by which the holder of a Unit assigns such
Unit to another Person who is or becomes an Assignee and includes a sale,
assignment, gift, pledge, encumbrance, hypothecation, mortgage, exchange or any
other disposition by law or otherwise.
10.1.2 No
interest shall be transferred in whole or in part, except in accordance with the
terms and conditions set forth in this Article 10. Any transfer or purported
transfer of an interest not made in accordance with this Article 10 shall be
null and void.
10.2.1 Except
as set forth in this Article 10.2.1, the General Partner may transfer all, but
not less than all, of its interest as the general partner to a single transferee
if, but only if, (i) at least a majority of the Limited Partners approve of such
transfer and of the admission of such transferee as general partner, (ii) the
transferee agrees to assume the rights and duties of the General Partner and be
bound by the provisions of this Agreement and other applicable agreements, and
(iii) the Partnership receives an Opinion of Counsel that such transfer would
not result in the loss of limited liability of any Limited Partner or of the
Partnership or cause the Partnership to be taxable as a corporation or otherwise
taxed as an entity for federal income tax purposes. The foregoing
notwithstanding, the General Partner is expressly permitted to pledge its
interest as General Partner to secure the obligations of the Partnership under a
Revolving Credit Facility, as the same may be amended, supplemented, replaced,
refinanced or restated from time to time, or any successor or subsequent loan
agreement.
24
10.2.2 Neither
Article 10.2.1 nor any other provision of this Agreement shall be construed to
prevent (and all Partners do hereby consent to) (i) the transfer by the General
Partner of all of its interest as a general partner to an Affiliate or (ii) the
transfer by the General Partner of all its interest as a general partner upon
its merger or consolidation with or other combination into any other Person or
the transfer by it of all or substantially all of its assets to another Person
if, in the case of a transfer described in either clause (i) or (ii) of this
sentence, the rights and duties of the General Partner with respect to the
interest so transferred are assumed by the transferee and the transferee agrees
to be bound by the provisions of this Agreement; provided, that in either such
case, such transferee furnishes to the Partnership an Opinion of Counsel that
such merger, consolidation, combination, transfer or assumption will not result
in a loss of limited liability of any Limited Partner or of the Partnership or
cause the Partnership to be taxable as a corporation or otherwise taxed as an
entity for federal income tax purpose. In the case of a transfer pursuant to
this Article 10.2.2, the transferee or successor (as the case may be) shall be
admitted to the Partnership as the General Partner immediately prior to the
transfer of the interest, and the business of the Partnership shall continue
without dissolution.
10.3.1 Units
may be transferred only in the manner described in Article 9.2. The transfer of
any Units and the admission of any new Partner shall not constitute an amendment
to this Agreement.
10.3.2 Until
admitted as a Substituted Limited Partner pursuant to Article 11, the Record
Holder of a Unit shall be an Assignee in respect of such Unit. Limited Partners
may include custodians, nominees or any other individual or entity in its own or
any representative capacity.
10.3.3 Each
distribution in respect of Units shall be paid by the Partnership, directly or
through the Transfer Agent or through any other Person or agent, only to the
Record Holders thereof as of the Record Date set for the distribution. Such
payment shall constitute full payment and satisfaction of the Partnership’s
liability in respect of such payment, regardless of any claim of any Person who
may have an interest in such payment by reason of an assignment or
otherwise.
10.3.4 A
transferee who has completed and delivered a Transfer Application provided by
the seller of the Units (or if purchased on an exchange directly from the
Partnership), shall be deemed to have (i) requested admission as a Substituted
Limited Partner, (ii) agreed to comply with and be bound by and to have executed
this Agreement, (iii) represented and warranted that such transferee has the
capacity and authority to enter into this Agreement, (iv) made the powers of
attorney set forth in this Agreement, and (v) given the consents and made the
waivers contained in this Agreement.
25
10.5.1 All
Limited Partners or Assignees (or, if the Limited Partner or Assignee is a
nominee holding for the account of a Beneficial Owner, the Beneficial Owner) are
required to provide the Partnership with a properly completed Tax
Certificate.
10.5.2 If
a Limited Partner or Assignee (or, if the Limited Partner or Assignee is a
nominee holding for the account of a Beneficial Owner, the Beneficial Owner)
fails to provide the Partnership with a properly completed Tax Certificate, the
General Partner may request at any time and from time to time, that such Limited
Partner or Assignee (or Beneficial Owner) shall, within 15 days after request
(whether oral or written) therefore by the General Partner, furnish to the
Partnership, a properly completed Tax Certificate. If a Limited Partner or
Assignee fails to furnish to the General Partner within the aforementioned
15-day period such Tax Certificate, the Units owned by such Limited Partner or
Assignee (or in the case of a Limited Partner or Assignee that holds Units on
behalf of a Beneficial Owner, the Units held on behalf of the Beneficial Owner)
shall be subject to redemption in accordance with the provisions of Article
10.6.
10.6.1 If
at any time a Limited Partner or Assignee fails to furnish a properly completed
Tax Certificate within the 15-day period specified in Article 10.5.2, the
Partnership may redeem the Units of such Limited Partner or Assignee as
follows:
(a) The
General Partner shall not later than the tenth (10th) Business Day before the
date fixed for redemption, give notice of redemption to the Limited Partner or
Assignee, at its last address designated on the records of the Partnership or
the Transfer Agent, by registered or certified mail, postage prepaid. The notice
shall be deemed to have been given when so mailed (the “Notice Date”). The notice
shall specify the Redeemable Units, the date fixed for redemption, the place of
payment, and that payment of the redemption price will be made upon surrender of
the certification evidencing the Redeemable Units.
(b) The
aggregate redemption price for Redeemable Units shall be an amount equal to the
market price as of the Close of Business on the Business Day immediately prior
to the date fixed for redemption of Units to be so redeemed multiplied by the
number of Units included among the Redeemable Units. The redemption price shall
be paid in the sole discretion of the General Partner, in cash or by delivery of
a promissory note of the Partnership in the principal amount of the redemption
price, bearing interest at the Prime Rate (as established by the Federal Reserve
Board) and payable in three equal annual installments of principal together with
accrued interest commencing one year after the redemption date.
26
(c) Upon
surrender by or on behalf of the Limited Partner or Assignee, at the place
specified in the notice of redemption, of the certification evidencing the
Redeemable Units, duly endorsed in blank or accompanied by an assignment duly
executed in blank, the Limited Partner or Assignee or its duly authorized
representative shall be entitled to receive the payment therefore.
(d) In
the event the Partnership is required to pay withholding tax or otherwise
withhold any amount on behalf of, or with respect to, a Limited Partner or
Assignee (or Beneficial Owner) who has failed to provide a properly completed
Tax Certificate, such amounts paid or withheld by the Partnership shall be
deemed to have been paid to such Limited Partner or Assignee (or Beneficial
Owner) as part of the redemption price for the Redeemable Units and the
Partnership shall reduce the amount of the payment made to such Limited Partner
or Assignee (or Beneficial owner) in redemption of such Redeemable Units by any
amounts so withheld.
10.6.3 The
provisions of this Article 10.6 shall also be applicable to Units held by a
Limited Partner or Assignee as nominee of a Beneficial Owner.
ARTICLE
11
27
11.4.1 A
Person (other than the General Partner, an Initial Limited Partner or a
Substituted Limited Partner) who makes a Capital Contribution to the Partnership
in accordance with this Agreement shall be admitted to the Partnership as an
Additional Limited Partner only upon furnishing to the General Partner (i)
evidence of acceptance in form satisfactory to the General Partner of all of the
terms and conditions of this Agreement, including, without limitation, the power
of attorney granted in this Agreement, and (ii) such other documents or
instruments as may be required in the discretion of the General Partner to
effect such Person’s admission as an Additional Limited Partner.
11.4.2 Notwithstanding
anything to the contrary in this Article 11.4, no Person shall be admitted as an
Additional Limited Partner without the consent of the General Partner, which
consent may be given or withheld in the General Partner’s sole discretion. The
admission of any Person as an Additional Limited Partner shall become effective
on the date upon which the name of such Person is recorded on the books and
records of the Partnership, following the consent of the General Partner to such
admission.
ARTICLE
12
Withdrawal
or Removal of Partners
12.1 Withdrawal of the General
Partner.
12.1.1 The
General Partner shall be deemed to have withdrawn from the Partnership upon the
occurrence of any one of the following events (each such event herein referred
to as an “Event of
Withdrawal”):
28
(a) the
General Partner voluntarily withdraws from the Partnership by giving written
notice to the other Partners;
(b) the
General Partner transfers all of its rights as general partner pursuant to this
Agreement;
(c) the
General Partner is removed;
(d) the
General Partner (1) makes a general assignment for the benefit of creditors; (2)
files a voluntary bankruptcy petition; (3) files a petition or answer seeking
for itself a reorganization, arrangement, composition, readjustment liquidation,
dissolution or similar relief under any law; (4) files an answer or other
pleading admitting or failing to contest the material allegations of a petition
filed against the General Partner in a proceeding of the type described in
clauses (1) — (3) of this sentence; or (5) seeks, consents to or acquiesces in
the appointment of a trustee, receiver or liquidator of the General Partner or
of all or any substantial part of its properties;
(e) a
final and non-appealable judgment is entered by a court with appropriate
jurisdiction ruling that the General Partner is bankrupt or insolvent or a final
and non-appealable order for relief is entered by a court with appropriate
jurisdiction against the General Partner, in each case under any federal or
state bankruptcy or insolvency laws as now or hereafter in effect;
or
(f) a
certificate of dissolution or its equivalent is filed for the General Partner,
or 90 days expire after the date of notice to the General Partner of revocation
of its charter without a reinstatement of its charter, under the laws of its
state of incorporation.
If an
Event of Withdrawal specified in this Article 12.1.1(d), (e) or (f) occurs, the
withdrawing General Partner shall give written notice to the Limited Partners
within 30 days after such occurrence. The Partners hereby agree that only the
Events of Withdrawal described in this Article 12.1 shall result in the
withdrawal of the General Partner from the Partnership.
12.1.2 Withdrawal
of the General Partner from the Partnership upon the occurrence of an Event of
Withdrawal will not constitute a breach of this Agreement under the following
circumstances: (i) the General Partner voluntarily withdraws by giving at least
90 days’ advance notice to the Limited Partners, such withdrawal to take effect
on the date specified in such notice; or (ii) at any time that the General
Partner ceases to be a General Partner pursuant to Article 12.1.1(b) or is
removed pursuant to Article 12.2. If the General Partner gives a
notice of withdrawal pursuant to Article 12.1.1(a), holders of at least a
majority of such Outstanding Units (excluding for purposes of such determination
any Units owned by the General Partner and its Affiliates) may, prior to the
effective date of such withdrawal, elect a successor General Partner. If, prior
to the effective date of the General Partner’s withdrawal, a successor is not
selected by the Unitholders as provided herein, the Partnership shall be
dissolved in accordance with Article 13. If a successor General Partner is
elected, such successor shall be admitted immediately prior to the effective
time of the withdrawal or removal of the Departing Partner and shall continue
the business of the Partnership without dissolution.
12.2 Removal of the General
Partner. The General Partner may be removed only if such
removal is approved by the Unitholders holding at least 66 2/3% of the
Outstanding Units (excluding for this purpose any Units held by the General
Partner and its Affiliates). Any such action by such holders for removal of the
General Partner must also provide for the election of a successor General
Partner by the Unitholders holding a majority of the Outstanding Units
(excluding for this purpose any Units held by the General Partner and its
Affiliates). Such removal shall be effective immediately following the admission
of a successor General Partner.
29
12.3 Withdrawal of a Limited Partner
other than the Organizational Limited Partner. In addition to
withdrawal of a Limited Partner due to its redemption of Units constituting a
Redemption Basket under this Agreement, the General Partner may, at any time, in
its sole discretion, require any Limited Partner to withdraw entirely from the
Partnership or to withdraw a portion of its Partner Capital Account, by giving
not less than 15 days’ advance written notice to the Limited Partner thus
designated. In addition, the General Partner without notice may require at any
time, or retroactively, withdrawal of all or any portion of the Capital Account
of any Limited Partner: (i) that made a misrepresentation to the General Partner
in connection with its purchase of Units; or (ii) whose ownership of Units would
result in the violation of any law or regulations applicable to the Partnership
or a Partner. The Limited Partner thus designated shall withdraw from the
Partnership or withdraw that portion of its Partner Capital Account specified in
such notice, as the case may be, as of the Close of Business on such date as
determined by the General Partner. The Limited Partner thus designated shall be
deemed to have withdrawn from the Partnership or to have made a partial
withdrawal from its Partner Capital Account, as the case may be, without further
action on the part of said Limited Partner and the provisions of Article 17.6
shall apply.
ARTICLE
13
(a) The
death, adjudication of incompetence, bankruptcy, dissolution, withdrawal, or
removal of a General Partner who is the sole remaining General Partner, unless a
majority in interest of the Limited Partners within 90 days after such event
elects to continue the Partnership and appoints a successor General Partner;
or
(b) The
affirmative vote of a majority in interest of the Limited Partners; provided,
however, that any such termination shall be subject to the conditions set forth
in this Agreement.
30
13.3.1 Upon
termination of the Partnership, the affairs of the Partnership shall be wound up
and all of its debts and liabilities discharged or otherwise provided for in the
order of priority as provided by law. The fair market value of the remaining
assets of the Partnership shall then be determined by the General Partner.
Thereupon, the assets of the Partnership shall be distributed to the Partners
pro rata in accordance with their Units. Each Partner shall receive its share of
the assets in cash or in kind, and the proportion of such share that is received
in cash may vary from Partner to Partner, all as the General Partner in its sole
discretion may decide. If such distributions are insufficient to return to any
Partner the full amount of its Capital Contributions, such Partner shall have no
recourse against any other Partner.
13.3.2 The
winding up of the affairs of the Partnership and the distribution of its assets
shall be conducted exclusively by the General Partner or its successor, which is
hereby authorized to do all acts authorized by law for these purposes. Without
limiting the generality of the foregoing, the General Partner, in carrying out
such winding up and distribution, shall have full power and authority to sell
all or any of the Partnership’s assets or to distribute the same in kind to the
Partners.
ARTICLE
14
ARTICLE
15
(a)
execute, swear to, acknowledge, deliver, file and record in the appropriate
public offices (i) all certificates, documents and other instruments (including,
without limitation, this Agreement and the Certificate of Limited Partnership
and all amendments or restatements thereof) that the General Partner or the
liquidator deems necessary or appropriate to form, qualify or continue the
existence or qualification of the Partnership as a limited partnership (or a
partnership in which the limited partners have limited liability) in the State
of Delaware and in all other jurisdictions in which the Partnership may conduct
business or own property, (ii) all certificates, documents and other instruments
that the General Partner or the liquidator deems necessary or appropriate to
reflect, in accordance with its terms, any amendment, change, modification or
restatement of this Agreement, (iii) all certificates, documents and other
instruments (including, without limitation, conveyances and a certificate of
cancellation) that the General Partner or the liquidator deems necessary or
appropriate to reflect the dissolution and liquidation of the Partnership
pursuant to the terms of this Agreement, (iv) all certificates, documents and
other instruments relating to the admission, withdrawal, removal or substitution
of any Partner or the Capital Contribution of any Partner, (v) all certificates,
documents and other instruments relating to the determination of the rights,
preferences and privileges of Units issued, and (vi) all certificates documents
and other instruments (including, without limitation, agreements and a
certificate of merger) relating to a merger or consolidation of the
Partnership;
31
(b)
execute, swear to, acknowledge, deliver, file and record all ballots, consents,
approval waivers, certificates and other instruments necessary or appropriate,
in the sole discretion of the General Partner or the liquidator, to make,
evidence, give, confirm or ratify any vote, consent, approval, agreement or
other action that is made or given by the Partners hereunder or is consistent
with the terms of this Agreement or is necessary or appropriate, in the sole
discretion of the General Partner or the liquidator, to effectuate the terms or
intent of this Agreement, provided, that when required by this Agreement that
establishes a percentage of the Limited Partners or of the Limited Partners of
any class or series required to take any action, the General Partner or the
liquidator may exercise the power of attorney made in this Article 15 only after
the necessary vote, consent or approval of the Limited Partners or of the
Limited Partners of such class or series;
ARTICLE
16
32
16.6 Creation Transaction
Fee. To compensate the Partnership for its expenses in
connection with the creation of Baskets, a Participant is required to pay a
transaction fee to the Partnership of $1,000 per order to create Baskets. An
order may include multiple Baskets. The transaction fee may be reduced,
increased or otherwise changed by the General Partner. The General Partner shall
notify DTC in advance of any change in the transaction fee and will not
implement any increase in the fee for the creation of Baskets until 30 days
after the date of the notice.
33
ARTICLE
17
34
ARTICLE
18
18.3 Governing Law, Successors,
Severability. This Agreement shall be governed by the laws of
the State of Delaware, as such laws are applied by Delaware courts to agreements
entered into and to be performed in Delaware by and between residents of
Delaware and shall, subject to the restrictions on transferability set forth
herein, bind and inure to the benefit of the heirs, executors, personal
representatives, successors and assigns of the parties hereto. If any provision
of this Agreement shall be held to be invalid, the remainder of this Agreement
shall not be affected thereby.
35
36
|
General
Partner
|
|
|
Victoria
Bay Asset Management, LLC
|
|
|
By:
|
/s/ Xxxxxx Xxx
|
|
Name:
Xxxxxx Xxx
|
|
|
Title:
Management Director
|
|
|
Initial
Limited Partner
|
|
|
Xxxxxxx
Capital Group, LLC
|
|
|
By:
|
/s/ Xxxxx X’Xxxxx
|
|
Name:
Xxxxx X’Xxxxx
|
|
|
Title:
Senior Managing
Director
|
|
37
EXHIBIT
A
|
Assets
|
Management Fee
|
|
|
First
$1,000,000,000
|
0.60%
of NAV
|
|
|
After
the first $1,000,000,000
|
0.50%
of NAV
|
Fees and
Expenses are calculated on a daily basis and paid on a monthly basis (accrued at
1/365 of applicable percentage of the NAV on that day).
38
EXHIBIT
B
FORM
OF GLOBAL CERTIFICATE
Evidencing
Units Representing Limited Partner Interests
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE FUND OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE &
CO. OR TO SUCH OTHER ENTITY AS IS REQUIRED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO.,
HAS AN INTEREST HEREIN.
This is
to certify that Cede & Co. is the owner and registered holder of this
Certificate evidencing the ownership of issued and outstanding Limited Partner
Units (“Units”), each
of which represents a fractional undivided unit of a beneficial interest in
United States Natural Gas Fund, LP (the “Fund”), a Delaware limited
partnership. Capitalized terms used not defined herein have the
meaning given to such terms in the Second Amended and Restated Agreement of
Limited Partnership, as amended, supplemented or restated to the date hereof
(the “Limited Partnership
Agreement”).
At any
given time, this Certificate shall represent the limited units of beneficial
interest in the Fund purchased by a particular authorized Participant on the
date of this Certificate. The Limited Partnership Agreement of the Fund provides
for the deposit of cash with the Fund from time to time and the issuance by the
Fund of additional Creation Baskets representing the undivided units of
beneficial interest in the assets of the Fund. At the request of the registered
holder, this Certificate may be exchanged for one or more Certificates issued to
the registered holder in such denominations as the registered holder may
request; provided, however, that in the aggregate, the Certificates issued to
the registered holder hereof shall represent all Units outstanding at any given
time.
Each
authorized Participant hereby grants and conveys all of its rights, title and
interest in and to the Fund to the extent of the undivided interest represented
hereby to the registered holder of this Certificate subject to and in pursuance
of the Limited Partnership Agreement, all the terms, conditions and covenants of
which are incorporated herein as if fully set forth at length.
The
registered holder of this Certificate is entitled at any time upon tender of
this Certificate to the Fund, endorsed in blank or accompanied by all necessary
instruments of assignment and transfer in proper form, at its principal office
in the State of California and, upon payment of any tax or other governmental
charges, to receive at the time and in the manner provided in the Limited
Partnership Agreement, such holder’s ratable portion of the assets of the Fund
for each Redemption Basket tendered and evidenced by this
Certificate.
39
The
holder of this Certificate, by virtue of the purchase and acceptance hereof,
assents to and shall be bound by the terms of the Limited Partnership Agreement,
copies of which are on file and available for inspection at reasonable times
during business hours at the principal business office of the General
Partner.
The Fund
may deem and treat the person in whose name this Certificate is registered upon
the books of the Fund as the owner hereof for all purposes and the Fund shall
not be affected by any notice to the contrary.
The
Limited Partnership Agreement and this Certificate are executed and delivered by
Victoria Bay Asset Management, LLC as General Partner of the Fund, in the
exercise of the powers and authority conferred and vested in it by the Limited
Partnership Agreement. The representations, undertakings and agreements made on
the part of the Fund in the Limited Partnership Agreement or this Certificate
are made and intended not as personal representations, undertakings and
agreements by the General Partner, other than acting in its capacity as such,
but are made and intended for the purpose of binding only the Fund. Nothing in
the Limited Partnership Agreement or this Certificate shall be construed as
imposing any liability on the General Partner, individually or personally, to
fulfill any representation, undertaking or agreement other than as provided in
the Limited Partnership Agreement or this Certificate.
THE
HOLDER OF THIS SECURITY ACKNOWLEDGES FOR THE BENEFIT OF UNITED STATES NATURAL
GAS FUND, LP THAT THIS SECURITY MAY NOT BE SOLD, OFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED IF SUCH TRANSFER WOULD VIOLATE THE THEN APPLICABLE FEDERAL
OR STATE SECURITIES LAWS OR RULES AND REGULATIONS OF THE SECURITIES AND EXCHANGE
COMMISSION, ANY STATE SECURITIES COMMISSION OR ANY OTHER GOVERNMENTAL AUTHORITY
WITH JURISDICTION OVER SUCH TRANSFER, TERMINATE THE EXISTENCE OR QUALIFICATION
OF UNITED STATES NATURAL GAS FUND, LP UNDER THE LAWS OF THE STATE OF DELAWARE,
OR CAUSE UNITED STATES NATURAL GAS FUND, LP TO BE TREATED AS AN ASSOCIATION
TAXABLE AS A CORPORATION OR OTHERWISE TO BE TAXED AS AN ENTITY FOR FEDERAL
INCOME TAX PURPOSES (TO THE EXTENT NOT ALREADY SO TREATED OR TAXED). VICTORIA
BAY ASSET MANAGEMENT, LLC, THE GENERAL PARTNER OF UNITED STATES NATURAL GAS
FUND, LP, MAY IMPOSE ADDITIONAL RESTRICTIONS ON THE TRANSFER OF THIS SECURITY IF
IT RECEIVES AN OPINION OF COUNSEL THAT SUCH RESTRICTIONS ARE NECESSARY TO AVOID
A SIGNIFICANT RISK OF UNITED STATES NATURAL GAS FUND, LP BECOMING TAXABLE AS A
CORPORATION OR OTHERWISE BECOMING TAXABLE AS AN ENTITY FOR FEDERAL INCOME TAX
PURPOSES. THE RESTRICTIONS SET FORTH ABOVE SHALL NOT PRECLUDE THE SETTLEMENT OF
ANY TRANSACTIONS INVOLVING THIS SECURITY ENTERED INTO THROUGH THE FACILITIES OF
ANY NATIONAL SECURITIES EXCHANGE ON WHICH THIS SECURITY IS LISTED OR ADMITTED TO
TRADING.
This
Certificate shall not become valid or binding for any purpose until properly
executed by the General Partner.
|
Victoria
Bay Asset Management, LLC, as
General Partner
|
|
|
By:
|
|
|
Date:
|
|
40
EXHIBIT
C
ADDRESSES
FOR NOTICE
Victoria
Bay Asset Management, LLC
0000
Xxxxxx Xxx Xxxxxxx, Xxxxx 000
Xxxxxxx,
Xxxxxxxxxx 9450
with a
copy to
Xxxxx
Brothers Xxxxxxxx & Co.
00 Xxxxx
Xxxxxx
Xxxxxx,
XX 00000
Attention:
Manager, Fund Xxxxxxxxxxxxxx Xxxxxxxxxx
00
XXXXXXX
X
APPLICATION
FOR TRANSFER OF UNITS
Transferees
of Units must execute and deliver this application to United States Natural Gas Fund, LP,
c/o Victoria Bay Asset Management, LLC, 0000 Xxxxxx Xxx Xxxxxxx, Xxxxx 000,
Xxxxxxx, Xxxxxxxxxx 00000, to be admitted as limited partners to United
States Natural Gas Fund, LP.
The
undersigned (“Assignee”) hereby applies
for transfer to the name of the Assignee of the Units evidenced hereby and
hereby certifies to United States Natural Gas Fund, LP (the “Partnership”) that the
Assignee (including to the best of Assignee’ s knowledge, any person for whom
the Assignee will hold the Units) is an Eligible Holder.*
The
Assignee (a) requests admission as a Limited Partner and agrees to comply with
and be bound by, and hereby executes, the Second Amended and Restated Agreement
of Limited Partnership of the Partnership, as amended, supplemented or restated
to the date hereof (the “Limited Partnership
Agreement”), (b) represents and warrants that the Assignee has all right,
power and authority and, if an individual, the capacity necessary to enter into
the Limited Partnership Agreement, (c) appoints the General Partner of the
Partnership and, if a Liquidator shall be appointed, the Liquidator of the
Partnership as the Assignee’s attorney-in-fact to execute, swear to, acknowledge
and file any document, including, without limitation, the Limited Partnership
Agreement and any amendment thereto and the Certificate of Limited Partnership
of the Partnership and any amendment thereto, necessary or appropriate for the
Assignee’s admission as a Substituted Limited Partner and as a party to the
Limited Partnership Agreement, (d) gives the powers of attorney provided for in
the Limited Partnership Agreement, and (e) makes the waivers and gives the
consents and approvals contained in the Limited Partnership Agreement.
Capitalized terms used but not defined herein have the meanings given to such
terms in the Limited Partnership Agreement.
Date:
_______________________
|
|
|
|
|
Social
Security or other identifying
|
Signature
of Assignee
|
number of
Assignee
|
|
|
|
|
Purchase
Price including commissions, if any
|
Name
and Address of Assignee
|
Type of
Entity (check one):
|
Individual
|
Partnership
|
Corporation
|
|
Trust
|
Other
(specify)
|
If not an
Individual (check one):
the
entity is subject to United States federal income taxation on the income
generated by the Partnership;
42
the
entity is not subject to United States federal income taxation, but it is a
pass-through entity and all of its beneficial owners are subject to United
States federal income taxation on the income generated by the
Partnership;
the
entity is not subject to United States federal income taxation and it is (a) not
a pass-through entity or (b) a pass-through entity, but not all of its
beneficial owners are subject to United States federal income taxation on the
income generated by the Partnership. Important Note — by checking
this box, the Assignee is contradicting its certification that it is an Eligible
Holder.
* The
Term “Eligible Holder”
means (a) an individual or entity subject to United States federal income
taxation on the income generated by the Partnership; or (b) an entity not
subject to United States federal income taxation on the income generated by the
Partnership, so long as all of the entity’s owners are subject to United States
federal income taxation on the income generated by the Partnership. Individuals
or entities are subject to taxation, in the context of defining an Eligible
Holder, to the extent they are taxable on the items of income and gain allocated
by the Partnership. Schedule I hereto contains a list of various types of
investors that are categorized and identified as either “Eligible Holders” or
“Non-Eligible Holders.”
Nationality
(check one):
U.S.
Citizen, Resident or Domestic
Entity** Non-resident
Alien**
Foreign
Corporation**
** As those terms are defined in the
Code.
If the
U.S. Citizen, Resident or Domestic Entity box is checked, the following
certification must be completed.
Under
Section 1445(e) of the Internal Revenue Code of 1986, as amended (the “Code”), the Partnership must
withhold tax with respect to certain transfers of property if a holder of an
interest in the Partnership is a foreign person. To inform the Partnership that
no withholding is required with respect to the undersigned interestholder’s
interest in it, the undersigned hereby certifies the following (or, if
applicable, certifies the following on behalf of the
interestholder).
Complete
Either A or B:
A.
Individual Interestholder
1. I
am not a non-resident alien for purposes of U.S. income taxation.
2. My
U.S. taxpayer identification number (Social Security Number) is
____________
3. My
home address is __________________
B. Partnership,
Corporation or Other Interestholder
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1. The
interestholder is not a foreign corporation, foreign partnership, foreign trust
or foreign estate (as those terms are defined in the Code and Treasury
regulations).
2. The
interestholder’s U.S. employer identification number is
__________________
3. The
interestholder’s office address and place of incorporation (if applicable) is
__________________
The
interestholder agrees to notify the Partnership within sixty (60) days of the
date the interestholder becomes a foreign person.
The
interestholder understands that this certificate may be disclosed to the
Internal Revenue Service by the Partnership and that any false statement
contained herein could be punishable by fine, imprisonment or both.
Under
penalties of perjury, I declare that I have examined this certification and, to
the best of my knowledge and belief, it is true, correct and complete and, if
applicable, I further declare that I have authority to sign this document on
behalf of:
Name of
Interestholder
________________________________________________________________________________________
Signature
and Date
___________________________________________________________________________________________
Title (if
applicable)
___________________________________________________________________________________________
Note: If
the Assignee is a broker, dealer, bank, trust company, clearing corporation,
other nominee holder or an agent of any of the foregoing, and is holding for the
account of any other person, this application should be completed by an officer
thereof or, in the case of a broker or dealer, by a registered representative
who is a member of a registered national securities exchange or a member of
FINRA, or, in the case of any other nominee holder, a person performing a
similar function. If the Assignee is a broker, dealer, bank, trust company,
clearing corporation, other nominee owner or an agent of any of the foregoing,
the above certification as to any person for whom the Assignee will hold the
Units shall be made to the best of the Assignee’s knowledge.
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