Exhibit 1.01
AMENDED AND RESTATED SELLING AGREEMENT
Dated as of March 7, 2000
Xxxx Xxxxxx Xxxxxxxx Inc.
Two World Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Xxxxxx Xxxxxxx Xxxx Xxxxxx Spectrum Select L.P. ("Select"), a
limited partnership organized pursuant to a certificate of limited partnership
filed on March 21, 1991, as amended by certificates of amendment thereto filed
on April 20, 1998 and April 6, 1999, and an amended and restated limited
partnership agreement dated as of February 28, 2000, under the Delaware Revised
Uniform Limited Partnership Act ("DRULPA"); Xxxxxx Xxxxxxx Xxxx Xxxxxx Spectrum
Technical L.P. ("Technical"), a limited partnership organized pursuant to a
certificate of limited partnership filed on April 29, 1994, as amended by a
certificate of amendment thereto filed on April 6, 1999, and an amended and
restated limited partnership agreement dated as of February 28, 2000, under the
DRULPA; Xxxxxx Xxxxxxx Xxxx Xxxxxx Spectrum Strategic L.P. ("Strategic"), a
limited partnership organized pursuant to a certificate of limited partnership
filed on April 29, 1994, as amended by a certificate of amendment thereto filed
on April 6, 1999, and an amended and restated limited partnership agreement
dated as of February 28, 2000, under the DRULPA; Xxxxxx Xxxxxxx Xxxx Xxxxxx
Spectrum Global Balanced L.P. ("Global Balanced"), a limited partnership
organized pursuant to a certificate of limited partnership filed on April 29,
1994, as amended by certificates of amendment thereto filed on April 20, 1998
and April 6, 1999, and an amended and restated limited partnership agreement
dated as of February 28, 2000, under the DRULPA; Xxxxxx Xxxxxxx Xxxx Xxxxxx
Spectrum Currency L.P. ("Currency"), a limited partnership organized pursuant to
a certificate of limited partnership filed on October 20, 1999, and a limited
partnership agreement dated as of March 6, 2000, under the DRULPA; and Xxxxxx
Xxxxxxx Xxxx Xxxxxx Spectrum Commodity L.P. ("Commodity"), a limited partnership
organized pursuant to a certificate of limited partnership filed on July 31,
1997, as amended by a certificate of amendment thereto filed on March 7, 2000,
and an amended and restated limited partnership agreement dated as of March 6,
2000, under the DRULPA (collectively, the "Partnerships," and individually, a
"Partnership"), propose, subject to the terms and conditions set forth in this
Agreement, to concurrently offer, sell, and issue up to 11,000,000, 33,000,000,
19,000,000, 11,000,000, 12,000,000, and 7,000,000 units of limited partnership
interest (the "Units"), of Select, Technical, Strategic, Global Balanced,
Currency, and Commodity, respectively.
Demeter Management Corporation, a Delaware corporation, is the sole
general partner of each Partnership (the "General Partner"). Certain registered
commodity trading advisors (each, a "Trading Advisor" and collectively, the
"Trading Advisors") are acting as the trading advisors with respect to the
management of the Partnerships' trading activities pursuant to the respective
management agreements among the applicable Trading Advisor(s), the applicable
Partnership, and the General Partner (each, a "Management Agreement" and
collectively, the "Management Agreements").
Xxxx Xxxxxx Xxxxxxxx Inc., a Delaware corporation ("DWR"), acts as
selling agent pursuant to this Agreement and acts as the non-clearing commodity
broker (in such capacity, the "Non-Clearing Broker") pursuant to the respective
customer agreements between the Non-Clearing Broker and each Partnership
(collectively, the "DWR Customer Agreements"). Xxxx Futures, Inc., a Delaware
corporation ("CFI"), acts as the clearing commodity broker pursuant to the
respective customer agreements among CFI, the Non-Clearing Broker, and each of
Select, Technical, Strategic, Global Balanced, and Currency (collectively, the
"CFI Customer Agreements"). Xxxxxx Xxxxxxx & Co. Incorporated, a Delaware
corporation ("MS & Co."), acts as the clearing commodity broker pursuant to the
customer agreement among MS & Co., the Non-Clearing Broker, and Commodity (the
"MS & Co. Customer Agreement" and, together with the CFI Customer Agreements,
the "Clearing Broker Customer Agreements"). MS & Co. and CFI are collectively
referred to herein as the "Clearing Brokers." The Non-Clearing Broker and the
Clearing Brokers are collectively referred to herein as the "Commodity Brokers."
Subscriptions for Units will be held by The Chase Manhattan Bank (in such
capacity, the "Escrow Agent") pursuant to an amended and restated escrow
agreement among the Partnerships, the Escrow Agent, and DWR (the "Escrow
Agreement").
This Agreement amends and restates: (i) the Selling Agreement dated
as of September 1, 1994, as amended by Amendment Nos. 1 and 2 dated January 31,
and April 30, 1996, respectively, among Technical, Strategic, and Global
Balanced, the General Partner, and DWR; and (ii) the Amended and Restated
Selling Agreement dated as of May 11, 1999, among Select, Technical, Strategic,
Global Balanced, the General Partner, and DWR.
1. REPRESENTATIONS AND WARRANTIES OF THE GENERAL PARTNER AND THE
PARTNERSHIPS. The General Partner represents and warrants to each of the other
parties hereto as to each Partnership and itself, and, severally and not
jointly, represents and warrants to DWR as to itself with respect to the
agreements to which it is a party and with respect to the other applicable
documents, as follows:
(a) The Partnerships have provided to DWR, and filed with the
Securities and Exchange Commission (the "SEC") under the Securities Act of 1933,
as amended (the "1933 Act"), and the rules and regulations promulgated by the
SEC thereunder (the "SEC Regulations"):
(i) on June 10, 1994, a registration statement on Form S-1
(SEC File No. 33-80146), for the registration of an aggregate of
10,000,000 Units (subsequently allocated 4,000,000, 4,000,000, and
2,000,000 Units to Technical, Strategic, and Global Balanced,
respectively), and on August 25, 1994, Pre-Effective Amendment No. 1 to
such registration statement, which was declared effective by the SEC on
September 15, 1994 (collectively, the "1994 Registration Statement");
(ii) on June 30, 1995, Post-Effective Amendment No. 1 to the
1994 Registration Statement, which was declared effective by the SEC on
June 30, 1995;
(iii) on January 19, 1996, a registration statement on Form
S-1 (SEC File No. 333-00494), for the registration of 9,000,000,
6,000,000, and 5,000,000 Units of Technical, Strategic, and Global
Balanced, respectively, and on January 29 and 31, 1996,
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Pre-Effective Amendment Nos. 1 and 2, respectively, to such
registration statement, which was declared effective by the SEC on
January 31, 1996;
(iv) on April 4, 1996, a registration statement on Form S-1
(SEC File No. 333-3222), for the registration of 5,000,000, 2,500,000,
and 1,000,000 Units of Technical, Strategic, and Global Balanced,
respectively, and on April 29, 1996, Pre-Effective Amendment No. 1 to
such registration statement, which was declared effective by the SEC on
April 30, 1996 (collectively, the "1996 Registration Statement");
(v) on August 30, 1996, Post-Effective Amendment No. 1 to the
1996 Registration Statement, which was declared effective by the SEC on
September 9, 1996;
(vi) on October 9, 1996, Post-Effective Amendment No. 2 to the
1996 Registration Statement, which was declared effective by the SEC on
October 11, 1996;
(vii) on April 16, 1997, Post-Effective Amendment No. 3 to the
1996 Registration Statement, which was declared effective by the SEC on
April 25, 1997;
(viii) on March 12, 1998, (A) Post-Effective Amendment No. 4
to the 1996 Registration Statement, relating solely to the continuing
offering of unsold Units of Strategic and Global Balanced, as amended
by Post-Effective Amendment No. 5 to the 1996 Registration Statement
filed on May 7, 1998; (B) a registration statement on Form S-1 (SEC
File No. 333-47831), relating to the continuing offering of unsold
Units, as well as the registration of 5,000,000 additional Units, of
Technical, as amended by Pre-Effective Amendment No. 1 thereto filed on
May 7, 1998; and (C) a registration statement on Form S-1 (SEC File No.
333-47829), relating to the registration of 1,500,000 Units of Select,
as amended by Pre-Effective Amendment No. 1 thereto filed on May 7,
1998, each of which registration statements were declared effective by
the SEC on May 11, 1998;
(ix) on December 11, 1998, (A) Post-Effective Amendment No. 6
to the 1996 Registration Statement, relating solely to the continuing
offering of unsold Units of Strategic and Global Balanced; (B) a
registration statement on Form S-1 (SEC File No. 333-68779) relating to
the continuing offering of unsold Units, as well as the registration of
10,000,000 additional Units, of Technical (the "Technical 1998
Registration Statement"); and (C) a registration statement on Form S-1
(SEC File No. 333-68773) relating to the continuing offering of unsold
Units, as well as the registration of 5,000,000 additional Units, of
Select (the "Select 1998 Registration Statement"), each of which
registration statements were declared effective by the SEC on January
21, 1999;
(x) On April 12, 1999, Post-Effective Amendment No. 1 to the
Select 1998 Registration Statement, Post-Effective Amendment No. 1 to
the Technical 1998 Registration Statement, and Post-Effective Amendment
No. 7 to the 1996 Registration Statement, each of which Post-Effective
Amendments were each declared effective by the SEC on April 30, 1999;
(xi) On November 5, 1999, (A) a registration statement on Form
S-1 (SEC File No. 333-90467), relating to the continuing offering of
unsold Units, as well as the
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registration of 4,500,000 additional Units of Select; (B)
Post-Effective Amendment No. 2 to the Technical 1998 Registration
Statement, relating solely to the continuing offering of unsold Units
of Technical; (C) a registration statement on Form S-1 (SEC File No.
333-90487), relating to the continuing offering of unsold Units, as
well as the registration of 6,500,000 additional Units, of Strategic;
(D) a registration statement on Form S-1 (SEC File No. 333-90475),
relating to the continuing offering of unsold Units, as well as the
registration of 3,000,000 additional Units, of Global Balanced, each of
which registration statements were declared effective by the SEC on
February 28, 2000 (the registration statements referenced in this
Section 1(a)(xi) are collectively referred to herein as the "2000
Four-Fund Registration Statements"; each 2000 Four-Fund Registration
Statement includes the same preliminary prospectus, which was finalized
and dated March 6, 2000 (the "Four-Fund Prospectus")); and
(xii) On November 5, 1999, (A) a registration statement on
Form S-1 (SEC File No. 333-90485), relating to the registration of
12,000,000 Units of Currency; and (B) a registration statement on Form
S-1 (SEC File No. 333-90483), relating to the registration of 7,000,000
Units of Commodity, each of which registration statements were declared
effective by the SEC on March 6, 2000 (the registration statements
referenced in this Section 1(a)(xii) are collectively referred to
herein as the "2000 Two-Fund Registration Statements" and, together
with the 2000 Four-Fund Registration Statements, the "2000 Registration
Statements"; each 2000 Two-Fund Registration Statement includes the
same preliminary prospectus, which was finalized and dated March 6,
2000 (the "Two-Fund Prospectus"; and, either the Two-Fund Prospectus or
the Four-Fund Prospectus, the "Prospectus"));
(b) Copies of the preliminary prospectus contained in each of the
Registration Statement referred to in Sections 1(a)(i) - (xii) and copies of the
Prospectus have also been filed with (i) the Commodity Futures Trading
Commission (the "CFTC") under the Commodity Exchange Act (the "CEAct") and the
rules and regulations promulgated thereunder by the CFTC (the "CFTC Rules"); and
(ii) the National Futures Association (the "NFA") in accordance with NFA
Compliance Rule 2-13. Copies of each of the Registration Statements referred to
in Sections 1(a)(i) - (xii) have also been filed with NASD Regulation, Inc. (the
"NASD") pursuant to its Conduct Rules.
(c) Notwithstanding Sections 1(a) and 1(b) hereof, if a Partnership
files an amendment or amendments to its 2000 Registration Statement, then the
term "2000 Registration Statement" shall, from and after the filing of such
amendment(s), refer to the applicable 2000 Registration Statements, as amended
by such amendment(s), and the term "Prospectus" shall refer to the amended
prospectus then on file with the SEC as part of the applicable 2000 Registration
Statement; and if a prospectus as first issued in compliance with the SEC
Regulations shall differ from the prospectus on file at the time the applicable
2000 Registration Statement or any amendment thereto shall have become
effective, the term "Prospectus" shall refer to the prospectus most recently so
issued from and after the date on which it shall have been issued, including any
amendment or supplement thereto. The Partnerships will not file any amendment to
the 2000 Registration Statements or any amendment or supplement to the
Prospectus unless DWR has received reasonable prior notice of and a copy of such
amendments or supplements and has not reasonably objected thereto in writing.
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(d) The Partnerships' respective limited partnership agreements (as
amended and restated), as described in the first paragraph of this Agreement
(each, a "Limited Partnership Agreement" and collectively, the "Limited
Partnership Agreements") provide for the subscription for and sale of the Units;
all action required to be taken by the General Partner and the Partnerships as a
condition to the sale of the Units to qualified subscribers therefor has been,
or prior to Currency's "Initial Closing" and each Monthly Closing (as defined in
Section 5(b) hereof) (the Initial Closing or any Monthly Closing, a "Closing")
will have been, taken; and, upon payment of the consideration therefor specified
in each accepted Subscription and Exchange Agreement and Power of Attorney, in
the form included in the Prospectus as Exhibit B (the "Subscription Agreement"),
the Units will constitute valid limited partnership interests in the Partnership
for which Units were subscribed.
(e) Each Partnership is a limited partnership duly organized
pursuant to a certificate of limited partnership (as amended), as described in
the first paragraph of this Agreement (each, a "Certificate of Limited
Partnership"), a Limited Partnership Agreement and the DRULPA, and is validly
existing under the laws of the State of Delaware with full power and authority
to engage in the trading of futures, forwards, and options and to engage in its
other contemplated activities as described in the Prospectus; each Partnership
has received a certificate of authority to do business in the State of New York
as provided by Section 121-902 of the New York Revised Limited Partnership Act
and is qualified to do business in each jurisdiction in which the nature or
conduct of its business requires such qualification and where the failure to be
so qualified could materially adversely affect the Partnership's ability to
perform its obligations hereunder or under its Limited Partnership Agreement,
its Management Agreement(s), its DWR Customer Agreement, its Clearing Broker
Customer Agreement, or the Escrow Agreement, as applicable.
(f) The General Partner is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Delaware, and is
qualified to do business and is in good standing as a foreign corporation under
the laws of the State of New York and in each other jurisdiction in which the
nature or conduct of its business requires such qualification and where the
failure to be so qualified could materially adversely affect the General
Partner's ability to perform its obligations hereunder or under the Limited
Partnership Agreements, the Management Agreements, or as described in the
Prospectus.
(g) Each of the Partnerships and the General Partner has full
partnership and corporate power and authority, as applicable, under applicable
law to conduct its business and perform its respective obligations, as
applicable, under the Limited Partnership Agreements, the Management Agreements,
the DWR Customer Agreements, the Clearing Broker Customer Agreements, the Escrow
Agreement, and this Agreement.
(h) The 2000 Registration Statements and the Prospectus contain all
statements and information required to be included therein by the 1933 Act, the
SEC Regulations, the CEAct and the CFTC Rules. The 2000 Registration Statements
and the Prospectus at all times up to and including each Closing will comply in
all material respects with the requirements of the 1933 Act, the SEC
Regulations, the CEAct, the CFTC Rules, and the rules of the NASD and the NFA.
As of their respective effective dates, the 2000 Registration Statements did not
contain any untrue statement of a material fact or omit to state a material fact
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which was required to be stated therein or necessary to make the statements
therein not misleading. The Prospectus, as of its date of issue and as of each
Closing, will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in light of the
circumstances under which such statements were made, not misleading. Any
supplemental sales literature employed in offering the Units ("Sales
Literature"), when read in conjunction with the Prospectus, as of its date of
issue and as of each Closing, will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein, in light of the circumstances under which such statements were made,
not misleading. The Sales Literature will comply with the 1933 Act, the SEC
Regulations, the CEAct, the CFTC Rules, and the rules of the NASD and the NFA.
This representation and warranty shall not, however, apply to any statement or
omission in the 2000 Registration Statements, Prospectus or Sales Literature
relating to DWR or any Trading Advisor or made in reliance upon and in
conformity with information furnished by DWR or any Trading Advisor.
(i) The accountants who certified the financial statements filed
with the SEC as part of the 2000 Registration Statements are, with respect to
the General Partner and the Partnerships, independent public accountants as
required by the 1933 Act and the SEC Regulations.
(j) The financial statements filed as part of the 2000 Registration
Statements and those included in the Prospectus present fairly the financial
position of each Partnership and of the General Partner as of the dates
indicated; and said financial statements have been prepared in conformity with
generally accepted accounting principles (as described therein).
(k) Since the respective dates as of which information is given in
the 2000 Registration Statements and the Prospectus, except as may otherwise be
stated in or contemplated by the 2000 Registration Statements and the
Prospectus, there has not been any material adverse change in the condition,
financial or otherwise, business or prospects of the General Partner or any
Partnership, whether or not arising in the ordinary course of business.
(l) The General Partner will have a net worth at each Closing
sufficient in amount and satisfactory in form to meet the net worth requirements
set forth in each of the Limited Partnership Agreements.
(m) The Limited Partnership Agreements, the Management Agreements
and this Agreement have each been duly and validly authorized, executed, and
delivered by the General Partner on behalf of the Partnerships and the General
Partner, and each constitutes a valid and binding agreement of the Partnerships
and of the General Partner, enforceable in accordance with its terms. The DWR
Customer Agreements, the Clearing Broker Customer Agreements and the Escrow
Agreement have each been duly and validly authorized, executed, and delivered by
the General Partner on behalf of the Partnerships, and each constitutes a valid
and binding agreement of the Partnerships, enforceable in accordance with its
terms.
(n) The execution and delivery of the Limited Partnership
Agreements, the Management Agreements, the DWR Customer Agreements, the Clearing
Broker Customer Agreements, the Escrow Agreement, and this Agreement, the
incurrence of the obligations set
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forth in each of such agreements, and the consummation of the transactions
contemplated therein and in the 2000 Registration Statements and the Prospectus,
will not violate, or constitute a breach of, or default under, the certificate
of incorporation or bylaws of the General Partner, the Certificates of Limited
Partnership or the Limited Partnership Agreements of the Partnerships, or any
other agreement or instrument by which either the General Partner or the
Partnerships, as the case may be, is bound or any law, order, rule, or
regulation applicable to the General Partner or the Partnerships of any court,
governmental body, administrative agency, panel, or self-regulatory organization
having jurisdiction over the General Partner or the Partnerships.
(o) Except as set forth in the 2000 Registration Statements or the
Prospectus, there has not been in the five years preceding the date of the
Prospectus and there is not pending or, to the best of the General Partner's
knowledge, threatened, any action, suit, or proceeding at law or in equity
before or by any court, governmental body, administrative agency, panel, or
self-regulatory organization to which the General Partner, any of the
"principals" of the General Partner, as defined in CFTC Rule 4.10(e)(1)
("General Partner Principals"), or any of the Partnerships is or was a party, or
to which any of the assets of the General Partner or any of the Partnerships is
or was subject; and neither the General Partner nor any General Partner
Principal has received any notice of an investigation by the SEC, CFTC, NASD, or
NFA regarding noncompliance by the General Partner, the General Partner
Principals, or the Partnerships with the 1933 Act, the SEC Regulations, the
Securities Exchange Act of 1934, as amended (the "1934 Act"), any other federal
securities laws, rules or regulations, the CEAct, the CFTC Rules, or the rules
of the NASD or the NFA, which action, suit, proceeding, or investigation
resulted or might reasonably be expected to result in any material adverse
change in the condition, financial or otherwise, business or prospects of the
General Partner or any of the Partnerships, or which would be material to an
investor's decision to invest in any of the Partnerships.
(p) The General Partner and each "principal" of the General Partner,
as defined in CFTC Rule 3.1(a), have all federal, state, and foreign
governmental, regulatory, self-regulatory, and exchange approvals, licenses,
registrations, and memberships, and have effected all filings with federal,
state, and foreign governmental regulators, self-regulatory organizations, and
exchanges required to conduct their business and to act as described in the 2000
Registration Statements and the Prospectus, or required to perform their
obligations under the Limited Partnership Agreements, the DWR Customer
Agreements, the Clearing Broker Customer Agreements, the Escrow Agreement, the
Management Agreements and this Agreement. The General Partner is registered as a
commodity pool operator under the CEAct and is a member of the NFA as a
commodity pool operator. The General Partner's principals identified in the
Prospectus are all of the General Partner Principals.
(q) To the extent required under CFTC Rules and applicable CFTC
staff no-action letters, the actual performance of all pools "operated" within
the meaning of the CEAct by the General Partner and of the General Partner
Principals is disclosed in the Prospectus.
2. COVENANTS OF THE PARTNERSHIPS AND THE GENERAL PARTNER. Each
Partnership as to itself, severally and not jointly, and the General Partner as
to itself and each Partnership covenants and agrees as follows:
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(a) The Partnerships will prepare and file with the SEC, CFTC, NASD,
and NFA, promptly upon DWR's request, any amendments to the applicable 2000
Registration Statement(s), and any amendments and supplements to the Prospectus,
which may be necessary or advisable in connection with the offering and sale of
Units, and will use its best efforts to cause the same to become effective as
promptly as possible.
(b) As soon as any Partnership is advised or obtains knowledge
thereof, such Partnership will advise DWR of any requests made by the SEC, CFTC,
NASD, or NFA to amend the applicable 2000 Registration Statement, to amend or
supplement the Prospectus, or for additional information, or of the issuance by
the SEC of any stop order suspending the effectiveness of any 2000 Registration
Statement, of any order by the SEC, CFTC, NASD or NFA preventing or suspending
the use of the Prospectus, or of the institution of any proceedings for any such
purpose, and will use its best efforts to prevent the issuance of any such order
and, if any such order is issued, to obtain the lifting thereof as promptly as
possible.
(c) If, at any time after the effective date of any 2000
Registration Statement and any amendment thereto, any event occurs involving any
of the Partnerships, the General Partner, or any General Partner Principal, or
of which any of the Partnerships, the General Partner, or any General Partner
Principal is aware, as a result of which any 2000 Registration Statement or the
Prospectus, as then amended and supplemented, would include any untrue statement
of a material fact or any omission to state a material fact required to be
stated therein or necessary to make the statements therein (and, with respect to
the Prospectus, in light of the circumstances under which they were made) not
misleading, or if it becomes necessary or desirable at any time to amend or
supplement any 2000 Registration Statement or the Prospectus to comply with the
1933 Act, the SEC Regulations, the CEAct, the CFTC Rules, or the rules of the
NASD or the NFA, the Partnerships will promptly notify DWR thereof and will
prepare and file with the SEC, CFTC, NASD, and NFA an amendment or supplement
that will correct such statement or omission or that will effect such
compliance.
(d) The Partnerships will furnish to DWR copies of the 2000
Registration Statements, the Prospectus, and all amendments and supplements
thereto, in each case as soon as available and, in the case of the Prospectus,
in such quantities as DWR may reasonably request for delivery to it.
3. REPRESENTATIONS AND WARRANTIES OF THE NON-CLEARING BROKER. The
Non-Clearing Broker represents and warrants to each of the other parties hereto,
as follows:
(a) The Non-Clearing Broker is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Delaware, and is
qualified to do business and is in good standing as a foreign corporation in the
State of New York and in each other jurisdiction in which the nature or conduct
of its business requires such qualification and where the failure to be so
qualified could materially adversely affect the Non-Clearing Broker's ability to
perform its obligations hereunder or under the DWR Customer Agreements, or as
described in the Prospectus. The Non-Clearing Broker has full corporate power
and authority to perform its obligations under each of the DWR Customer
Agreements and this Agreement, and to conduct its business as described in the
2000 Registration Statements and the Prospectus.
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(b) As to the Non-Clearing Broker, the 2000 Registration Statements
and the Prospectus are accurate and complete in all material respects and
contain all statements and information required to be included therein under the
1933 Act, the SEC Regulations, the CEAct, the CFTC Rules, and the rules of the
NFA; as of their respective effective dates, the 2000 Registration Statements
did not contain any untrue statement of a material fact or omit to state a
material fact which was required to be stated therein or necessary to make the
statements therein not misleading; and the Prospectus, as of its date of issue
and as of each Closing, will not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements therein, in
light of the circumstances under which such statements were made, not
misleading.
(c) The Non-Clearing Broker and each "principal" of the Non-Clearing
Broker, as defined in CFTC Rule 3.1(a), have all federal, state, and foreign
governmental, regulatory, self-regulatory, and exchange approvals, licenses,
registrations, and memberships, and have effected all filings with federal,
state, and foreign governmental regulators, self-regulatory organizations, and
exchanges required to conduct their business and to act as described in the 2000
Registration Statements and the Prospectus, or required to perform their
obligations under each DWR Customer Agreement and this Agreement, as applicable.
The Non-Clearing Broker is registered as a futures commission merchant under the
CEAct and is a member of the NFA as a futures commission merchant.
(d) The DWR Customer Agreements and this Agreement have each been
duly and validly authorized, executed, and delivered by the Non-Clearing Broker,
and each constitutes a valid and binding agreement of the Non-Clearing Broker,
enforceable in accordance with its terms.
(e) Since the respective dates as of which information is given in
the 2000 Registration Statements and the Prospectus, except as may otherwise be
stated in or contemplated by the 2000 Registration Statements and the
Prospectus, there has not been any material adverse change in the condition,
financial or otherwise, business or prospects of the Non-Clearing Broker,
whether or not arising in the ordinary course of business.
(f) Except as set forth in the 2000 Registration Statements or the
Prospectus, there has not been in the five years preceding the date of the
Prospectus and there is not pending or, to the best of the Non-Clearing Broker's
knowledge, threatened, any action, suit, or proceeding at law or in equity
before or by any court, governmental body, administrative agency, panel, or
self-regulatory organization to which the Non-Clearing Broker is or was a party,
or to which any of the assets of the Non-Clearing Broker is or was subject; and
the Non-Clearing Broker has not received any notice of an investigation by the
NFA or the CFTC regarding noncompliance by the Non-Clearing Broker with the
CEAct, the CFTC Rules, or the rules of the NFA, which action, suit, proceeding
or investigation resulted in or might reasonably be expected to result in any
material adverse change in the condition, financial or otherwise, business or
prospects of the Non-Clearing Broker or which would be material to an investor's
decision to invest in any of the Partnerships.
(g) The execution and delivery of each DWR Customer Agreement and
this Agreement, the incurrence of the obligations set forth in each of such
agreement, and the
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consummation of the transactions contemplated therein and in the 2000
Registration Statements and in the Prospectus, will not violate, or constitute a
breach of, or default under, the certificate of incorporation or bylaws of the
Non-Clearing Broker or any other agreement or instrument by which it is bound,
or any law, order, rule, or regulation applicable to the Non-Clearing Broker of
any court, governmental body, administrative agency, panel, or self-regulatory
organization having jurisdiction over the Non-Clearing Broker.
4. COVENANTS OF THE NON-CLEARING BROKER. The Non-Clearing Broker
covenants and agrees as follows:
(a) The Non-Clearing Broker agrees reasonably to cooperate by
providing information regarding itself in the preparation of any amendments or
supplements to the 2000 Registration Statements and the Prospectus.
(b) The Non-Clearing Broker agrees to notify the General Partner
immediately upon discovery of any untrue statement of a material fact in the
2000 Registration Statements or the Prospectus relating to the Non-Clearing
Broker, or an omission to state a material fact relating to the Non-Clearing
Broker, required to be stated therein or necessary to make the statements
therein (and, with respect to the Prospectus, in light of the circumstances
under which they were made) not misleading, or of the occurrence of any event or
change in circumstances which would result in there being any material untrue or
misleading statement or a material omission in the Prospectus or the 2000
Registration Statements regarding the Non-Clearing Broker, or which would result
in the Prospectus not including all material information relating to the
Non-Clearing Broker, required pursuant to the CEAct, the CFTC Rules, or the
rules of the NFA.
5. APPOINTMENT OF THE SELLING AGENT.
(a) Subject to the terms and conditions set forth in this Agreement,
each Partnership hereby appoints DWR as its selling agent to offer and sell
Units on a best efforts basis, without any firm commitment on the part of DWR to
purchase any Units. DWR shall offer for sale up to 11,000,000, 33,0000,000,
19,000,000, 11,000,000, 12,000,000, and 7,000,000 Units of Select, Technical,
Strategic, Global Balanced, Currency, and Commodity, respectively, and such
additional Units as the General Partner may, in its discretion, register and
offer for sale from time to time.
(b) The term "Initial Offering Period" used in this section only
relates to Currency and is the period commencing March 6, 2000 and ending on
September 30, 2000, unless all of the registered Units of Currency have
previously been subscribed for or the General Partner has sooner terminated the
Initial Offering Period, or the General Partner extends the Initial Offering
Period as described below. During the Initial Offering Period, DWR will offer
Units of Currency for sale at an "Initial Closing," which currently is scheduled
to be held on April 30, 2000, at a price equal to $10.00 per Unit. However, the
General Partner may in its discretion hold such Initial Closing at any time
during the Initial Offering Period, and may extend the Initial Offering Period
until November 30, 2000. The Initial Closing for Currency shall not take place
unless subscriptions have been accepted for at least 600,000 Units of Currency.
If the minimum number of Units of Currency are not sold during the Initial
Offering
-10-
Period, the offering of Units of Currency shall terminate, and all subscription
amounts (together with any interest earned thereon) shall be refunded to
subscribers, as described under "Plan of Distribution" in the Two-Fund
Prospectus. Units of Currency which remain unsold following the Initial Closing
shall be offered for sale in the Partnerships' Continuing Offering described
below. Except as otherwise provided above, Units of Select, Technical,
Strategic, Global Balanced, Currency, and Commodity shall be offered, in the
sole discretion of the General Partner, for sale in a continuing offering (the
"Continuing Offering") at monthly closings ("Monthly Closings"), to be held as
of the last day of each month, at a price per Unit equal to 100% of a
Partnership's month-end net asset value, which is calculated by dividing the
Partnership's month-end net assets by the number of its month-end outstanding
Units ("Net Asset Value per Unit"), as of the close of business on the date of
such Monthly Closing. The minimum subscription for most subscribers shall be
$5,000, except that the minimum subscription is (i) $2,000 in the case of an
Individual Retirement Account ("XXX"); (ii) $500 per Partnership if the
subscriber presently owns Units in any Partnership; or (iii) for eligible
subscribers who redeem units of limited partnership interest in any other
commodity pool for which the General Partner is the general partner and
commodity pool operator, and, pursuant to a Subscription Agreement, use the
proceeds of such redemption (less any applicable redemption charges) to purchase
Units (each of such purchases is hereinafter referred to as a "Non-Series
Exchange"), the lesser of (A) $5,000 (or $2,000 in the case of IRAs), (B) the
proceeds from the redemption of (x) five units (or two units in the case of
IRAs) from commodity pools other than any of the Xxxxxx Xxxxxxx Xxxx Xxxxxx
Charter Series of partnerships (the "Charter Series"), or (y) 500 units (or 200
units in the case of IRAs) from any Charter Series partnership, or (C) the
proceeds from the redemption of such subscriber's entire interest in such other
commodity pool. In order to be eligible to purchase Units pursuant to a
Non-Series Exchange, a subscriber must purchase Units at a Closing held as of
the date on which the redemption from the other commodity pool becomes
effective. The initial investment (other than in the case of a Non-Series
Exchange) may be for Units of any one of the Partnerships or may be divided
among two or more Partnerships, except that the minimum subscription for any
Partnership is $1,000. In the case of a Non-Series Exchange, however, the
minimum subscription for any Partnership is the proceeds of the redemption of
one unit of the other commodity pool, or 100 Units in the case of any Charter
Series partnership. The number of Units received by a subscriber will be rounded
to the third decimal place.
(c) Notwithstanding any provision to the contrary herein, the
General Partner will have the sole discretion to accept or reject any
subscription for Units in whole or in part at any time prior to acceptance.
(d) No selling commissions will be charged with respect to the sale
of Units. The Partnerships understand, however, that DWR may compensate its
employees and certain "Additional Sellers" (as defined in Section 5(h)), solely
from DWR's own funds, in the manner described in Sections 5(e)-(i).
(e) Except as provided below, employees of DWR will receive from DWR
(payable solely from its own funds) a gross sales credit equal to three percent
(3%) of the Net Asset Value per Unit as of the date of the applicable Closing
for each Unit sold by them and issued at such Closing (such compensation, along
with any other underwriting compensation, will not exceed 10% of the proceeds
received in connection with the issuance of the Units).
-11-
Commencing (i) the seventh month after the Closing at which a Unit of Strategic,
Technical, or Select is issued, (ii) the tenth month after the Monthly Closing
at which a Unit of Global Balanced, Currency, or Commodity is issued, (iii) the
first month after a Unit is issued pursuant to a Non-Series Exchange, or (iv) in
the case of a Unit purchased pursuant to a Series Exchange (as defined in the
Prospectus), the first month as of which such continuous compensation is payable
under (i) or (ii), as applicable, but with the seven or ten month period
measured from the date at which the unit redeemed was issued, and continuing
until the applicable Partnership terminates or the Unit is redeemed (whichever
comes first), employees of DWR who are properly registered with the CFTC and are
members of the NFA, as set forth in Section 5(g), will also receive from DWR
(payable solely from its own funds) monthly gross sales credits of up to 86% of
the brokerage fees which are received by the Non-Clearing Broker from the
Partnership each month that are attributable to outstanding Units sold by them.
Such continuing compensation is to be paid in recognition of the continuing
services provided to limited partners of the Partnerships by DWR's employees, as
set forth in Section 5(i). No person will receive the continuing compensation
described above who is not an employee of DWR at the time of receipt of payment.
DWR employees who sell $500,000 or more of Units to any single investor will not
receive the initial gross sales credit equal to 3% of the Net Asset Value per
Unit. Those DWR employees will only be entitled to receive the continuing
compensation payments described above attributable to the outstanding Units,
starting with the first month after the Units are issued.
(f) DWR will not pay to an employee the 3% initial gross sales
credit described above with respect to Units purchased pursuant to a Series
Exchange or a Non-Series Exchange. Such employee will, however, receive
continuing gross sales credits with respect to brokerage fees received by the
Non-Clearing Broker from a Partnership which are comparable to the gross sales
credit which was received by such employee with respect to the commodity pool
whose units were redeemed in the Series Exchange or Non-Series Exchange, as
applicable.
(g) Notwithstanding the foregoing, DWR will not pay any such
continuing compensation to any of its employees who is not legally qualified or
permitted to receive such continuing compensation. In that regard, each of DWR's
employees who receive any such continuing compensation must have become
registered as an "associated person" of DWR with the CFTC and with the NFA in
such capacity only after either having passed the National Commodity Futures
Examination (NASD Test Series #3), the Futures Managed Funds Examination (NASD
Test Series #31), or having been "grandfathered" as an associated person under
the CEAct and the Bylaws and rules of the NFA. Also, such compensation may be
paid by DWR to its employees only in respect of outstanding Units sold by such
persons and only so long as the additional services described in Section 5(i)
are provided by such persons to Limited Partners; PROVIDED, HOWEVER, that DWR
may not pay any portion of such compensation to any individual no longer
employed by it, and PROVIDED, FURTHER, that such compensation may be paid to its
employees who, although not responsible for the sale of an outstanding Unit,
provide the services described below in place of the individual who was
responsible for such sale.
(h) DWR may appoint as its agent to make offers and sales of Units,
one or more securities brokers or dealers which are members in good standing of
the NASD, or any foreign bank, dealer, institution or person ineligible for
membership in the NASD which agrees to make no offers or sales of Units within
the United States or its territories, possessions or areas
-12-
subject to its jurisdiction or to persons who are citizens thereof or residents
therein, as additional selling agents (each, an "Additional Seller" and
collectively, the "Additional Sellers"), PROVIDED that each Additional Seller
shall execute an Additional Seller's Agreement substantially in the form
attached hereto as Exhibit A. DWR may compensate any Additional Seller by paying
such Additional Seller, solely from DWR's own funds, a commission, not to exceed
three percent (3%) of the Net Asset Value per Unit as of the date of the
applicable Closing, for each Unit sold by such Additional Seller and issued at
such Closing. In addition, commencing with (i) the seventh month after the
closing at which a Unit of Select, Technical, and Strategic is issued, (ii) the
tenth month after the Monthly Closing at which a Unit of Global Balanced,
Currency, and Commodity is issued, (iii) the first month after a Unit is issued
pursuant to a Non-Series Exchange, and (iv) in the case of a Unit purchased
pursuant to a Series Exchange, the first month as of which such continuing
compensation is payable under (i) or (ii), as applicable, but with the seven or
ten month period measured from the date at which the unit redeemed was issued,
and continuing until the applicable Partnership terminates or the Unit is
redeemed (whichever comes first), DWR may pay any Additional Seller continuing
compensation of up to 35% of the brokerage fees which are received by the
Non-Clearing Broker from the Partnerships each month that are attributable to
outstanding Units sold by such Additional Seller, in recognition of such
Additional Seller's continuing services to limited partners of the Partnerships,
as set forth in Section 5(i); PROVIDED, HOWEVER, that: (A) no continuing
compensation shall be paid to an Additional Seller unless it is properly
registered with the CFTC as a "futures commission merchant" or "introducing
broker," and is a member of the NFA in one of such capacities, and (B) no
Additional Seller which is registered as a futures commission merchant or
introducing broker may pay any portion of such continuing compensation to an
employee thereof unless such employee meets the same qualifications as DWR's
employees, as set forth in Section 5(g).
(i) The additional services that employees of DWR and Additional
Sellers will provide on an ongoing basis to limited partners at no charge will
include, but not be limited to: (i) inquiring of the General Partner from time
to time, at the request of limited partners, as to the Net Asset Value of a
Unit; (ii) inquiring of the General Partner from time to time, at the request of
limited partners, as to the futures, forwards and options markets and the
activities of the Partnerships; (iii) responding to questions of limited
partners from time to time with respect to monthly account statements, annual
reports, financial statements, and annual tax information furnished periodically
to limited partners; (iv) providing advice to limited partners from time to time
as to when and whether to make additional investments or to redeem or exchange
Units; (v) assisting limited partners from time to time in the redemption or
exchange of Units; and (vi) providing such other services as limited partners
from time to time may reasonably request.
(j) The Partnerships and DWR acknowledge that: (i) the Partnerships
shall have no liability to DWR, its employees, any Additional Seller, or any
employee of an Additional Seller with regard to any selling compensation
described above; and (ii) DWR will be paid any and all redemption charges
imposed on limited partners in accordance with Section 10(b) of each Limited
Partnership Agreement.
6. UNDERTAKINGS OF DWR.
(a) DWR agrees to use its best efforts to offer and sell Units on
the terms set forth in this Agreement, the 2000 Registration Statements, and the
Prospectus. It is understood
-13-
that DWR has no commitment to offer and sell Units or to purchase Units, other
than to use its best efforts to offer and sell Units.
(b) DWR will make the public offering of Units at the offering price
and on the other terms and conditions set forth in the 2000 Registration
Statements, the Prospectus, and this Agreement. DWR will offer and sell Units
only to persons who satisfy the suitability and/or minimum investment
requirements set forth in the Prospectus and the Subscription Agreement and who,
to the General Partner's satisfaction, complete a Subscription Agreement. DWR
will conduct a thorough review of the suitability of each subscriber for Units,
of each Subscription Agreement authorizing the General Partner and DWR to
transfer the full subscription price from the subscriber's customer account with
DWR to the escrow account established with the Escrow Agent pursuant to the
Escrow Agreement (the "Escrow Account"), and of each Subscription Agreement
requesting a Series Exchange or a Non-Series Exchange, as described under
"Summary--Who May Subscribe" and "Exchange Right" in the Prospectus.
(c) All of DWR's branch offices will be required to forward
subscriptions to the General Partner's office in New York, New York no later
than noon of the first business day following their receipt of an acceptable
Subscription Agreement from a subscriber for Units. Subsequent to its review of
each Subscription Agreement, the General Partner will notify DWR, and DWR shall
notify each subscriber by the business day following its receipt of notice from
the General Partner, of the General Partner's acceptance of all, a portion, or
none of the subscriber's subscription.
(d) All funds from subscriptions received by DWR during the Initial
Offering of Currency and the Continuing Offering of the Partnerships and not
rejected by the General Partner will be promptly deposited by DWR in the Escrow
Account as described below. A subscriber whose Subscription Agreement is
received by DWR and whose subscription is not immediately rejected by the
General Partner must have the full subscription amount in his customer account
with DWR on the first business day following the date that his Subscription
Agreement is received by DWR, and DWR will transfer such subscription funds to
the Escrow Agent on that date. DWR will notify the General Partner of the
subscription amount deposited with the Escrow Agent on behalf of each subscriber
for Units and the name and residence address of each such subscriber.
Subscription funds held in the Escrow Account shall earn interest and
subscribers shall be credited with interest, as described under "Plan of
Distribution--Escrow Arrangements" in the Prospectus.
(e) DWR will offer and sell Units in compliance with the
requirements set forth in the 2000 Registration Statements, the Prospectus
(particularly under the captions "Summary--Who May Subscribe" and "--The
Offering of Units," "Plan of Distribution," "Subscription Procedure," and
"Purchases by Employee Benefit Plans--ERISA Considerations"), the Subscription
Agreement, and this Agreement. In connection with DWR's acting as selling agent,
DWR will comply fully at all times with all applicable federal, state, and
foreign securities and commodities laws (including, without limitation, the 1933
Act, the 1934 Act, the CEAct, and the securities ("Blue Sky") laws of the
jurisdictions in which DWR solicits subscriptions), and all requirements of the
NASD (particularly Conduct Rule 2810), the Board of Governors of the Federal
Reserve System, and the securities and commodities exchanges and other
governmental regulators and self-regulatory authorities and organizations having
-14-
jurisdiction over DWR. Specifically, (i) DWR will not permit the purchase of any
Units by a customer account over which DWR has discretionary authority without
the prior written approval by the customer owning such account; (ii) DWR will
confirm that it has reasonable grounds to believe that all material facts are
adequately and accurately disclosed in the Prospectus, which provides a basis
for evaluating the Partnerships; (iii) DWR will confirm that in determining the
adequacy of disclosed facts pursuant to clause (ii), it has obtained information
on material facts relating to: (A) items of compensation, (B) tax aspects, (C)
financial stability and experience of the General Partner, and (D) the
Partnerships' conflicts and risk factors; (iv) in recommending to a subscriber
the purchase or redemption of Units, a Series Exchange or a Non-Series Exchange,
DWR shall take such measures as are reasonably necessary to assure itself that
(A) its financial advisors have informed such subscriber of all pertinent facts
relating to the liquidity and marketability of the Units, and (B) its financial
advisors have reasonable grounds to believe, on the basis of information
obtained from such subscriber concerning his investment objectives, other
investments, financial situation and needs, and any other information known by
such financial advisors, that: (1) such subscriber is or will be in a financial
position appropriate to enable him to realize to a significant extent the
benefits described in the Prospectus, (2) such subscriber has a fair market net
worth sufficient to sustain the risks inherent in the purchase of Units,
including loss of investment and lack of liquidity, and (3) the purchase of
Units is otherwise suitable for such subscriber and (v) DWR shall take such
measures as are reasonably necessary to assure itself that each subscriber has
received a Prospectus at least five business days prior to the applicable
Closing. The General Partner will maintain in its files, located c/o Xxxx Xxxxxx
Xxxxxxxx Inc., Two Xxxxx Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, each
subscriber's Subscription Agreement for not less than six years, and DWR will
maintain, at its respective branch offices, any other documents disclosing the
basis upon which the determination of suitability was reached for each such
subscriber.
(f) All subscriptions received and accepted by the General Partner
will, upon the satisfaction at each Closing of the conditions set forth in
Sections 9 and 10 hereof, be delivered to the respective Partnerships at each
Closing, and any interest earned on a subscriber's subscription funds while held
in escrow will be promptly returned to DWR in accordance with the Escrow
Agreement for prompt credit to the subscriber's customer account with DWR.
Interest earned on any subscriptions deposited into the Escrow Account and
thereafter rejected by the General Partner will be credited to the subscriber's
customer account with DWR.
(g) Any amounts credited to a subscriber's customer account with DWR
for a returned subscription and/or for interest earned will be immediately
available for investment or withdrawal from such account. In the event a
subscriber's customer account with DWR has been closed, any subscription
returned and/or interest earned will be paid by check.
7. BLUE SKY FILINGS. The Partnerships will use their best efforts to
qualify Units for offer and sale under the Blue Sky laws of such jurisdictions
as DWR may reasonably request, to make applications, file documents, and furnish
information as may be reasonably required for that purpose, and to comply with
such laws so as to permit the continuance of sales and dealings in such
jurisdictions for as long as may be necessary to complete the offer and sale of
Units; PROVIDED, HOWEVER, that neither the Partnerships nor the General Partner
will be required to qualify as or be subject to taxation as a foreign
partnership or corporation or to execute a general consent to service of process
in any jurisdiction. The Partnerships further
-15-
agree that their counsel will prepare and deliver to DWR Blue Sky surveys which
will set forth, for DWR's guidance, in what manner, at what time, in what
amounts, and by whom Units may be offered and sold in jurisdictions requested by
DWR as provided above.
8. ORGANIZATIONAL AND OFFERING EXPENSES. DWR shall pay all of the
costs incurred in connection with the organization and initial offering of
Spectrum Currency. DWR will also pay all of the costs incurred in connection
with the offering of Units during the Continuing Offering (collectively, the
"Offering Expenses"), including all legal, accounting, and auditing fees and
expenses of outside firms and all costs, disbursements, filing fees, fees and
expenses of the Escrow Agent, printing and duplication costs, marketing costs
and expenses, and other related costs and expenses. Legal, accounting, and
auditing fees and expenses of outside firms shall include the legal, accounting,
and auditing expenses of DWR, the Partnerships and the General Partner relating
to the offering of Units. Marketing costs and expenses shall include, but not be
limited to, the printing and preparation of Sales Literature, the production of
audio and video tapes for use in sales presentations, and the staging of sales
seminars and the travel of DWR and General Partner personnel associated
therewith. DWR shall not be reimbursed for such expenses by the Partnerships.
Such expenses will not include the travel, legal, and other expenses of the
Trading Advisors, including such expenses incurred in connection with the
marketing of Units, which expenses shall be borne by the respective Trading
Advisors (unless DWR agrees to pay same from its own funds).
9. CLOSINGS.
(a) The Initial Closing, if any, for the acceptance of subscriptions
for Units of Currency is currently scheduled to be held on April 30, 2000.
Monthly Closings in the Continuing Offering for Units of Select, Technical,
Strategic, Global Balanced, and Commodity, and after its Initial Closing,
Currency, shall be held as of the last day of each month. Each Monthly Closing
will be held at such time, and at such location or locations, as the General
Partner and DWR may mutually agree upon.
(b) Subject to its right to reject any subscription in its sole
discretion in whole or in part at any time prior to acceptance, the General
Partner, on behalf of each Partnership, will accept subscriptions for Units
properly made and cause proper entry to be made in the Unit register to be
maintained by the General Partner. No certificate evidencing Units shall be
issued to any subscriber; rather, DWR will deliver confirmations in its
customary form to subscribers whose subscriptions have been accepted by the
General Partner at each Closing.
(c) At each Closing, the delivery, receipt, and acceptance of
subscriptions for Units will be subject to the terms and conditions set forth in
this Agreement, including the following: (i) payment of the full subscription
price for Units and delivery of a properly completed Subscription Agreement by
each subscriber; and (ii) compliance with Section 10 hereof.
(d) Upon the satisfaction of such terms and conditions, the
aggregate subscription price for Units (exclusive of any interest earned on such
subscriptions while held in escrow and payable to the subscribers in accordance
with the Escrow Agreement) will be paid and delivered to the applicable
Partnership at each Closing.
-16-
10. CONDITIONS OF DWR'S OBLIGATIONS.
(a) DWR's obligations to proceed with the offering and sale of Units
and each Closing will be subject to: (i) the accuracy of the representations and
warranties by the Partnerships and the General Partner in this Agreement as of
the date hereof and as of the date of such Closing as if such representations
and warranties had been made on and as of the date thereof; (ii) the performance
by the Partnerships and the General Partner of their respective covenants and
agreements herein; and (iii) the additional conditions precedent set forth
below.
(b) At each Closing, the additional conditions precedent are as
follows:
(i) No stop order suspending the effectiveness of any of the
2000 Registration Statements will have been issued and no proceedings
for that purpose will have been instituted or are pending or, to the
knowledge of the Partnerships or DWR, are contemplated or threatened by
the SEC. No order preventing or suspending the use of the Prospectus
will have been issued and no proceedings for that purpose will have
been instituted or are pending or, to the knowledge of the Partnerships
or DWR, are contemplated or threatened by the SEC, CFTC, NASD, or NFA.
Any requests of the SEC, CFTC, NASD, or NFA for additional information
(to be included in any of the 2000 Registration Statements or the
Prospectus or otherwise) will have been complied with to DWR's
satisfaction.
(ii) Neither DWR nor any Trading Advisor will have advised the
Partnerships or the General Partner that, in its opinion, any of the
2000 Registration Statements or the Prospectus contains any untrue
statement of a material fact or any omission to state a material fact
required to be stated therein or necessary to make the statements
therein (in the case of the Prospectus, in light of the circumstances
under which they were made) not misleading.
(iii) At the request of DWR, the General Partner will have
furnished to DWR a certificate, dated the date of the Closing and in
form and substance satisfactory to DWR, to the effect that:
(A) The representations and warranties by the
Partnerships and the General Partner in this Agreement are
true, accurate, and complete on and as of the date of the
Closing as if made on the date of the Closing.
(B) No stop order suspending the effectiveness of any
of the 2000 Registration Statements has been issued by the SEC
and no proceedings for that purpose have been instituted or
are pending or, to the knowledge of the General Partner, are
contemplated or threatened under the 1933 Act. No order
preventing or suspending the use of the Prospectus has been
issued by the SEC, CFTC, NASD, or NFA and no proceedings for
that purpose have been instituted or are pending or, to the
knowledge of the General Partner, are contemplated or
threatened under the 1933 Act or the CEAct.
(C) The Partnerships and the General Partner have
performed all of their obligations and satisfied all of the
conditions on their part to be
-17-
performed or satisfied under this Agreement, the Management
Agreements, the Escrow Agreement, the DWR Customer Agreements,
and the Clearing Broker Customer Agreements at or prior to the
date of the Closing.
(D) The General Partner has made its capital
contribution to each Partnership and has met the net worth
standard required of it by each Limited Partnership Agreement.
(iv) Cadwalader, Xxxxxxxxxx & Xxxx, counsel to the General
Partner and the Partnerships, shall deliver its opinion to the parties
hereto at such Closing as requested by DWR, in form and substance
satisfactory to the parties hereto, to the effect that:
(A) Each Limited Partnership Agreement provides for
the subscription for and sale of the Units; all action
required to be taken by the General Partner and each
Partnership as a condition to the subscription for and sale of
the Units to qualified subscribers therefor has been taken;
and, upon payment of the consideration therefor specified in
the accepted Subscription Agreements, the Units will
constitute valid limited partnership interests in the
applicable Partnership and each subscriber who purchases Units
will become a Limited Partner, subject to the requirements
that each such purchaser shall have duly completed, executed,
and delivered to the applicable Partnership a Subscription
Agreement relating to the Units purchased by such purchaser,
that such purchaser meets all applicable suitability
standards, and that the representations and warranties of such
purchaser in the Subscription Agreement are true and correct
and that such purchaser is included as a Limited Partner in
the applicable Partnership's records. Such counsel need not
independently verify compliance with such requirements.
(B) Each Partnership is a limited partnership duly
formed pursuant to its Certificate of Limited Partnership, its
Limited Partnership Agreement and the DRULPA and is validly
existing under the laws of the State of Delaware with full
partnership power and authority to conduct the business in
which it proposes to engage as described in the applicable
2000 Registration Statement and the Prospectus and to perform
its obligations under its Limited Partnership Agreement, its
Management Agreement(s), its DWR Customer Agreement, its
Clearing Broker Customer Agreement, the Escrow Agreement, and
this Agreement; and each Partnership has received a
Certificate of Authority to do business in the State of New
York as contemplated under Article 8-A of the New York Revised
Limited Partnership Act and need not effect any other filings
or qualifications under the laws of any other jurisdictions to
conduct its business as described in the applicable 2000
Registration Statement and the Prospectus.
(C) The General Partner is a corporation duly
organized, validly existing, and in good standing under the
laws of the State of Delaware and is qualified to do business
and is in good standing as a foreign corporation in the State
of New York and in each other jurisdiction in which the nature
or conduct of
-18-
its business requires such qualification and where the failure
to be so qualified might reasonably be expected to result in
material adverse consequences to any Partnership or might
materially adversely affect the General Partner's ability to
perform its obligations as described in the 2000 Registration
Statements and the Prospectus. The General Partner has full
corporate power and authority to conduct its business as
described in the 2000 Registration Statements and the
Prospectus and to perform its obligations under each Limited
Partnership Agreement, each Management Agreement, each DWR
Customer Agreement, each Clearing Broker Customer Agreement,
the Escrow Agreement, and this Agreement, as applicable.
(D) The General Partner and its "principals," as
defined in CFTC Rule 3.1(a), and each Partnership have all
federal and state governmental, regulatory, self-regulatory
and exchange approvals, licenses, registrations, and
memberships, and have effected all filings with federal and
state governmental regulators, self-regulatory organizations
and exchanges required for the General Partner and each
Partnership to conduct their business and to act as described
in the 2000 Registration Statements and the Prospectus, or
required to perform their obligations under each Limited
Partnership Agreement, each Management Agreement, [each DWR
Customer Agreement, each Clearing Broker Customer Agreement,
the Escrow Agreement], and this Agreement, except for such
approvals, licenses, registrations, memberships, and filings
the absence of which would not have a material adverse effect
on their ability of the Partnerships or the General Partner to
act as described in the 2000 Registration Statements and the
Prospectus, or to perform their obligations under such
agreements, and, to the best of such counsel's knowledge,
after due investigation, none of such approvals, licenses,
registrations, memberships, or filings has been rescinded,
revoked, or suspended.
(E) Each Limited Partnership Agreement, each
Management Agreement, each DWR Customer Agreement, each
Clearing Broker Customer Agreement, the Escrow Agreement, and
this Agreement has been duly and validly authorized, executed,
and delivered by or on behalf of the General Partner and/or
each Partnership, as the case may be, and each Limited
Partnership Agreement constitutes a valid and binding
agreement of the General Partner, each Management Agreement
constitutes a valid and binding agreement of the General
Partner and the applicable Partnership, the Escrow Agreement
constitutes a valid and binding agreement of each Partnership
and DWR, and this Agreement constitutes a valid and binding
agreement of each Partnership, the General Partner and DWR,
and, in the case of each valid and binding agreement above,
the agreement is enforceable in accordance with its terms,
subject to bankruptcy, insolvency, reorganization, moratorium,
or similar laws at the time in effect affecting the
enforceability generally of rights of creditors and by general
principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at
law), and except as enforceability of indemnification,
exculpation, and contribution provisions may be limited by
applicable law or public policy.
-19-
(F) The execution and delivery of the respective
Limited Partnership Agreements, the respective Management
Agreements, the respective DWR Customer Agreements, the
respective Clearing Broker Customer Agreements, the Escrow
Agreement, and this Agreement, as applicable, the offer and
sale of the Units by each Partnership, the incurrence of the
obligations herein and therein set forth, and the consummation
of the transactions contemplated herein, therein, and in the
Prospectus, will not be in contravention of the General
Partner's certificate of incorporation or bylaws, any
Certificate of Limited Partnership, or any Limited Partnership
Agreement, or the certificate of incorporation or bylaws of
DWR, and, to the best of such counsel's knowledge, based upon
due inquiry of certain officers of the General Partner, will
not violate, or constitute a breach of, or default under, any
other agreement or instrument known to such counsel by which
the General Partner or any Partnership is bound, and will not
violate any order known to such counsel, or any law, rule, or
regulation applicable to the General Partner or any
Partnership of any court, governmental body, administrative
agency, panel, or self-regulatory organization having
jurisdiction over the General Partner or any Partnership.
(G) To the best of such counsel's knowledge, based
upon due inquiry of certain officers of the General Partner,
except as disclosed in the Prospectus, there are no actions,
suits, or proceedings at law or in equity pending or
threatened before or by any court, governmental body,
administrative agency, panel, or self-regulatory organization,
nor have there been any such actions, suits, or proceedings
within the five years preceding the date of the Prospectus, to
which the General Partner or any Partnership is or was a
party, or to which any of the assets of the General Partner or
any of the Partnerships is or was subject, which would be
material to an investor's decision to invest in a Partnership,
or which resulted or might reasonably be expected to result in
a materially adverse change in the condition, financial or
otherwise, business or prospects of the General Partner or any
Partnership, whether or not arising in the ordinary course of
business.
(H) The information in the Prospectus under the
captions "Summary--Tax Considerations," "Risk
Factors--Taxation Risks," "Purchases by Employee Benefit
Plans--ERISA Considerations," "Material Federal Income Tax
Considerations," "State and Local Income Tax Aspects," and
"The Limited Partnership Agreements," to the extent that such
information constitutes matters of law or legal conclusions,
has been reviewed by such counsel and is correct.
(I) The 2000 Registration Statements are effective
under the 1933 Act and, to the best of such counsel's
knowledge, no proceedings for a stop order are pending or
threatened under Section 8(d) of the 1933 Act or any Blue Sky
laws.
(J) At the time the 2000 Registration Statements
became effective, the 2000 Registration Statements, and at the
time the Prospectus was issued and as of the Closing, the
Prospectus, complied as to form in all material
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respects with the requirements of the 1933 Act, the SEC
Regulations, the CEAct, the CFTC Rules, and the rules of the
NASD and NFA. Nothing has come to such counsel's attention
that would lead them to believe that the 2000 Registration
Statements at the time they became effective contained any
untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to
make the statements therein not misleading, or that the
Prospectus at the time it was issued or at the Closing
contained an untrue statement of a material fact or omitted to
state a material fact necessary to make the statements
therein, in light of the circumstances under which they were
made, not misleading; PROVIDED, HOWEVER, that
such counsel need express no opinion or belief (a) as to the
information in the 2000 Registration Statements or the
Prospectus regarding the Trading Advisors, the Commodity
Brokers, or their respective principals, (b) as to the
financial statements, notes thereto and other financial or
statistical data set forth in the 2000 Registration Statements
and the Prospectus, or (c) as to the performance data and
notes or descriptions thereto set forth in the 2000
Registration Statements and the Prospectus.
(K) Based upon reliance on certain SEC "no-action"
letters, as of the Closing, none of the Partnerships must
register as an "investment company" under the Investment
Company Act of 1940, as amended.
In rendering its opinion, such counsel may rely on
information obtained from public officials, officers of the
General Partner, and other sources believed by it to be
responsible, and may assume that signatures on all documents
examined by it are genuine, and that a Subscription Agreement
in the form referred to in the Prospectus, has been duly
authorized, completed, dated, executed, and delivered and
funds representing the full subscription price for the Units
purchased have been delivered by each purchaser of Units in
accordance with the requirements set forth in the Prospectus.
(v) Cadwalader, Xxxxxxxxxx & Xxxx, counsel to the Non-Clearing
Broker, shall deliver an opinion to the parties hereto at such Closing
as requested by DWR, in form and substance satisfactory to the parties
hereto, to the effect that:
(A) The Non-Clearing Broker is a corporation duly
organized, validly existing, and in good standing under the
laws of the State of Delaware and is qualified to do business
and is in good standing as a foreign corporation in the State
of New York and in each other jurisdiction in which the nature
or conduct of its business requires such qualification and
where the failure to be so qualified might reasonably be
expected to result in material adverse consequences to the
Non-Clearing Broker or might materially adversely affect the
Non-Clearing Broker's ability to perform its obligations as
described in the 2000 Registration Statements and the
Prospectus. The Non-Clearing Broker has full corporate power
and authority to perform its obligations as described in the
2000 Registration Statements and the Prospectus and to perform
its obligations under the DWR Customer Agreements, the
Clearing Broker Customer Agreements and this Agreement.
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(B) The DWR Customer Agreements, the Clearing Broker
Customer Agreements and this Agreement have been duly and
validly authorized, executed, and delivered by the
Non-Clearing Broker, and the DWR Customer Agreements, the
Clearing Broker Customer Agreements and this Agreement
constitute valid and binding agreements of the Non-Clearing
Broker, enforceable in accordance with their respective terms,
subject to bankruptcy, insolvency, reorganization, moratorium,
or similar laws at the time in effect affecting the
enforceability generally of rights of creditors and by general
principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at
law), and except as enforceability of indemnification,
exculpation, and contribution provisions may be limited by
applicable law or public policy.
(C) The Non-Clearing Broker has all federal and state
governmental, regulatory, self-regulatory and exchange
approvals, licenses, registrations, and memberships, and has
effected all filings with federal and state governmental
regulators, self-regulatory organizations and exchanges
required to conduct its business and to act as described in
the 2000 Registration Statements and the Prospectus, or
required to perform its obligations under the DWR Customer
Agreements, the Clearing Broker Customer Agreements and this
Agreement, except for such approvals, licenses, registrations,
memberships, and filings the absence of which would not have a
material adverse effect on its ability to act as described in
the 2000 Registration Statements and the Prospectus, or to
perform its obligations under such agreements, and, to the
best of such counsel's knowledge, after due investigation,
none of such approvals, licenses, registrations, memberships,
or filings has been rescinded, revoked or suspended.
(D) The execution and delivery of the DWR Customer
Agreements, the Clearing Broker Customer Agreements and this
Agreement, the incurrence of the obligations herein and
therein set forth, and the consummation of the transactions
contemplated herein, therein, and in the Prospectus, will not
be in contravention of the Non-Clearing Broker's certificate
of incorporation or bylaws, and to the best of such counsel's
knowledge, based upon due inquiry of certain officers of the
Non-Clearing Broker, will not violate, or constitute a breach
of, or default under, any other agreement or instrument known
to such counsel by which the Non-Clearing Broker is bound, and
will not violate any order known to such counsel or any law,
rule, or regulation applicable to the Non-Clearing Broker of
any court, governmental body, administrative agency, panel, or
self-regulatory organization having jurisdiction over the
Non-Clearing Broker.
(E) To the best of such counsel's knowledge, based
upon due inquiry of certain officers of the Non-Clearing
Broker, except as disclosed in the Prospectus, there are no
actions, suits, or proceedings at law or in equity pending or
threatened before or by any court, governmental body,
administrative agency, panel, or self-regulatory organization,
nor have there been any such actions, suits, or proceedings
within the five years preceding the date of the Prospectus, to
which the Non-Clearing Broker is or was a party, or to which
any of its assets is or was subject, which would be material
to an investor's decision to invest in a
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Partnership, or which resulted or might reasonably be expected
to result in a materially adverse change in the condition,
financial or otherwise, business or prospects of the
Non-Clearing Broker, whether or not arising in the ordinary
course of business.
(F) Nothing has come to such counsel's attention to
lead such counsel to believe that, as to the Non-Clearing
Broker, (1) the 2000 Registration Statements at the time they
became effective contained any untrue statement of a material
fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading, or (2) the Prospectus at the time it was issued or
at the Closing contained an untrue statement of a material
fact or omitted to state a material fact necessary in order to
make the statements therein relating to the Non-Clearing
Broker, in light of the circumstances under which they were
made, not misleading.
In rendering its opinion, such counsel may rely on information
obtained from public officials, officers of the Non-Clearing
Broker, and other sources believed by it to be responsible and
may assume that signatures on all documents examined by it are
genuine.
(vi) Deloitte & Touche L.L.P., independent certified public
accountants for the Partnerships and the General Partner, will have
furnished to DWR a letter, at such Closing as requested by DWR, dated
the date of the Closing and in form and substance satisfactory to DWR,
to the effect that:
(A) Such accountant is an independent certified
public accountant within the meaning of the 1933 Act, the
CEAct, and the SEC Regulations with respect to the
Partnerships and the General Partner.
(B) In such accountant's opinion, the statements of
financial condition of the Partnerships and the General
Partner and the notes thereto included in the Prospectus and
examined by it comply as to form in all material respects with
the applicable accounting requirements of the 1933 Act, the
CEAct, and the SEC Regulations.
(C) On the basis of limited procedures not
constituting an audit, including inquiries of officials of the
General Partner having responsibility for financial and
accounting matters pertaining to the Partnerships and such
other inquiries and procedures as may be specified in such
letter, nothing has come to such accountant's attention which
causes it to believe that, as of a specified date not more
than five business days prior to the date of the Closing,
there has been any decrease in the Net Assets of any
Partnership as compared to the Net Assets set forth in the
respective statements of financial condition of the
Partnerships included in the Prospectus, except as may be
disclosed in such letter.
(D) On the basis of limited procedures, not
constituting an audit, including a reading of the latest
available financial statements of the
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General Partner, inspection of the minute book of the General
Partner since the date of the latest audited financial
statements of the General Partner, inquiries of officials of
the General Partner having responsibility for financial and
accounting matters, and such other inquiries and procedures as
may be specified in such letter, nothing has come to such
accountant's attention that causes it to believe that, as of a
specified date not more than five business days prior to the
date of the Closing, there has been any decrease in the
General Partner's net worth as compared to net worth set forth
in the statement of financial condition of the General Partner
included in the Prospectus, except as may be disclosed in such
letter.
(vii) The Non-Clearing Broker shall deliver a certificate to
the parties hereto, in form and substance satisfactory to such parties,
at such Closing as requested by DWR, to the effect that the
representations and warranties of the Non-Clearing Broker contained
herein are true and correct with the same effect as though expressly
made at such Closing.
(viii) Each Trading Advisor shall deliver, at such Closing as
requested by DWR, such certificate as specified in each such Trading
Advisor's respective Management Agreement.
(ix) Counsel to each Trading Advisor shall deliver, at such
Closing as requested by DWR, such legal opinion as specified in the
respective Management Agreement of each Trading Advisor.
(x) All agreements contemplated herein or in the 2000
Registration Statements or the Prospectus shall have been duly executed
and delivered.
11. INDEMNIFICATION.
(a) Each Partnership agrees to indemnify, defend, and hold harmless
DWR, the General Partner, each Additional Seller (if any) and their respective
"affiliates" (as defined in Section 11(c)) from and against any loss, liability,
damage, cost, and expense (including attorneys' and accountants' fees and
expenses incurred in investigating or defending any demands, claims, or
lawsuits), actually and reasonably incurred arising from any act, omission,
activity, or conduct undertaken pursuant to this Agreement by or on behalf of
the Partnership, including, without limitation, any demands, claims, or lawsuits
initiated by a limited partner (or assignee thereof), PROVIDED that (1) DWR, the
General Partner, or the Additional Seller, as applicable, has determined, in
good faith, that the act, omission, activity, or conduct giving rise to the
claim for indemnification was in the best interests of the Partnership, and (2)
the act, omission, activity, or conduct that was the basis for such loss,
liability, damage, cost, or expense was not the result of misconduct or
negligence. The indemnity in this Section 11(a) is in addition to any liability
that the Partnership may otherwise have and will extend, upon the same terms and
conditions, to each person, if any, who controls an indemnified person within
the meaning of the 1933 Act. Notwithstanding anything to the contrary contained
in the foregoing, neither DWR, the General Partner, an Additional Seller, nor
their respective affiliates shall be indemnified by a Partnership for any
losses, liabilities, or expenses arising from or out of an
-24-
alleged violation of federal or state securities laws unless (1) there has been
a successful adjudication on the merits of each count involving alleged
securities laws violations as to the particular indemnitee, or (2) such claims
have been dismissed with prejudice on the merits by a court of competent
jurisdiction as to the particular indemnitee, or (3) a court of competent
jurisdiction approves a settlement of the claims against the particular
indemnitee and finds that indemnification of the settlement and related costs
should be made, PROVIDED, with regard to such court approval, the indemnitee
must apprise the court of the position of the SEC, and the positions of the
respective securities administrators of Massachusetts, Missouri, Tennessee,
and/or those other states and jurisdictions in which the plaintiffs claim that
they were offered or sold Units, with respect to indemnification for securities
laws violations before seeking court approval for indemnification. Furthermore,
in any action or proceeding brought by a limited partner in the right of a
Partnership to which the General Partner, DWR, an Additional Seller, or any
affiliate of any of the foregoing is a party defendant, any such person shall be
indemnified only to the extent and subject to the conditions specified in the
DRULPA and this Section 11. A Partnership shall make advances to the General
Partner, DWR, an Additional Seller, or their respective affiliates hereunder
only if: (1) the demand, claim, or lawsuit relates to the performance of duties
or services by such persons to the Partnership; (2) such demand, claim, or
lawsuit is not initiated by a limited partner; and (3) such advances are repaid,
with interest at the legal rate under Delaware law, if the person receiving such
advance is ultimately found not to be entitled to indemnification hereunder.
(b) DWR agrees to indemnify, hold harmless, and defend each
Partnership, the General Partner, their respective "affiliates" (as defined in
Section 11(c)), and their respective successors and assigns, from and against
any loss, claim, damage, liability, cost, and expense, joint or several
(including attorneys' and accountants' fees and expenses incurred in
investigating or defending any demands, claims, or lawsuits), to which any
indemnified party may become subject under the 1933 Act, the 1934 Act, the
CEAct, the Blue Sky law of any jurisdiction, or otherwise (including in
connection with the settlement of claims approved in advance by DWR and in
connection with any administrative proceedings), in respect of the offer or sale
of Units, insofar as such loss, claim, damage, liability, cost, or expense
arises out of, or is based upon: (i) a breach by DWR of any representation,
warranty, or agreement in this Agreement or any certificate delivered pursuant
to this Agreement, or the failure by DWR to perform any covenant made by DWR
herein; or (ii) a misleading or untrue statement of a material fact made in any
of the 2000 Registration Statements, the Prospectus or any Sales Literature, or
an omission to state a material fact therein which is required to be stated
therein or necessary to make the statements therein (in the case of the
Prospectus and any Sales Literature, in light of the circumstances under which
they were made) not misleading, PROVIDED such statement or omission relates
specifically to DWR, or was made in reliance upon, and in conformity with,
written information or instructions furnished by or on behalf of DWR or DWR's
agents. The indemnity in this Section 11(b) is in addition to any liability that
DWR may otherwise have and will extend, upon the same terms and conditions, to
each person, if any, who controls an indemnified person within the meaning of
the 1933 Act.
(c) As used in this Section 11, the term "affiliate" of a person
shall mean: (i) any natural person, partnership, corporation, association, or
other legal entity directly or indirectly owning, controlling, or holding with
power to vote 10% or more of the outstanding voting securities of such person;
(ii) any partnership, corporation, association, or other legal
-25-
entity 10% or more of whose outstanding voting securities are directly or
indirectly owned, controlled, or held with power to vote by such person; (iii)
any natural person, partnership, corporation, association, or other legal entity
directly or indirectly controlling, controlled by, or under common control with,
such person; or (iv) any officer, director, or partner of such person.
Notwithstanding the foregoing, solely for purposes of determining eligibility
for indemnification under Section 11(a), the term "affiliate" shall include only
those persons performing services for the applicable Partnership.
(d) Promptly after receipt by an indemnified party under Section
11(a) or (b) hereof of notice of the commencement of any action, claim, or
proceeding to which any of such subsections may apply, the indemnified party
will notify the indemnifying party in writing of the commencement thereof if a
claim in respect thereof is to be made against the indemnifying party under any
of such subsections; but the omission so to notify the indemnifying party will
not relieve the indemnifying party from any liability which the indemnifying
party may have to the indemnified party otherwise than under any of such
subsections, except where such omission has materially prejudiced the
indemnifying party. In case any action, claim, or proceeding is brought against
an indemnified party and the indemnified party notifies the indemnifying party
of the commencement thereof as provided above, the indemnifying party will be
entitled to participate therein and, to the extent that the indemnifying party
desires, to assume the defense thereof with counsel selected by the indemnifying
party and not unreasonably disapproved by the indemnified party. After notice
from the indemnifying party to the indemnified party of the indemnifying party's
election so to assume the defense thereof as provided above, the indemnifying
party will not be liable to the indemnified party under any of such subsections
for any legal and other expenses subsequently incurred by the indemnified party
in connection with the defense thereof, other than reasonable costs of
investigation.
(e) Notwithstanding Section 11(d), if, in any action, claim, or
proceeding as to which indemnification is or may be available under Section
11(a) or (b) hereof, an indemnified party reasonably determines that its
interests are or may be adverse, in whole or in part, to the indemnifying
party's interests or that there may be legal defenses available to the
indemnified party which are different from, in addition to, or inconsistent
with, the defenses available to the indemnifying party, the indemnified party
may retain its own counsel in connection with such action, claim, or proceeding,
and will be indemnified by the indemnifying party for any legal and other
expenses reasonably incurred in connection with investigating or defending such
action, claim, or proceeding.
(f) In no event will the indemnifying party be liable for the fees
and expenses of more than one counsel for all indemnified parties in connection
with any one action, claim, or proceeding, or in connection with separate but
similar or related actions, claims, or proceedings, in the same jurisdiction
arising out of the same general allegations. The indemnifying party will not be
liable for any settlement of any action, claim, or proceeding effected without
the indemnifying party's express written consent, but if any action, claim, or
proceeding is settled with the indemnifying party's express written consent or
if there is a final judgment for the plaintiff in any such action, claim, or
proceeding, the indemnifying party will indemnify, defend, and hold harmless an
indemnified party as provided in Section 11(a) or (b) hereof, as applicable.
-26-
(g) The exculpation provisions in each DWR Customer Agreement and in
each Limited Partnership Agreement shall not relieve any party thereto from any
liability it may have or incur to any party under this Agreement; nor shall any
party thereto be entitled to be indemnified by any party thereto pursuant to the
indemnification provisions contained in such agreements, against any loss,
liability, damage, cost, or expense it may incur under this Agreement.
12. TERMINATION. Each of the parties shall have the right to
terminate this Agreement as to itself at any time prior to a Closing by giving
written notice of such termination to the other parties.
13. SURVIVAL. The respective indemnities, agreements, obligations,
representations, warranties, and other statements of the parties hereto set
forth in this Agreement or in any certificates delivered pursuant hereto will
remain in full force and effect (regardless of any investigation or any
statement as to the results thereof made by, or on behalf of, DWR, any
Partnership, the General Partner or any officer, director, controlling person,
or agent of any of the foregoing) and will survive the delivery of and payment
for Units and the termination or expiration of this Agreement, and each Closing.
14. NOTICES. All notices required or desired to be given under this
Agreement must be in writing and will be effective when given personally on the
date delivered or, when given by mail, on the date of receipt, addressed as
follows (or to such other address as the party entitled to notice hereafter
designates in accordance with the terms hereof):
if to a Partnership, the Partnerships or the General Partner:
Demeter Management Corporation
Xxx Xxxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xx. Xxxxxx X. Xxxxxx
President
if to DWR:
Xxxx Xxxxxx Xxxxxxxx Inc.
Xxx Xxxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xx. Xxxxxx X. Xxxxxx
Senior Vice-President
in either case with a copy to:
Cadwalader, Xxxxxxxxxx & Xxxx
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx X. Xxxx, Esq.
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15. SUCCESSORS. This Agreement will be binding upon and inure solely
to the benefit of DWR, each Partnership and the General Partner (and to the
extent provided in Section 11 hereof, the "affiliates" of each Partnership, the
General Partner, DWR, any Additional Sellers, and the respective heirs,
executors, administrators, successors, and assigns of such persons), and no
other person will acquire or have any rights under or by virtue of this
Agreement. No purchaser of Units will be deemed to be a successor or assign to
any party hereto merely by reason of such purchase.
16. ASSIGNMENT; AMENDMENT. This Agreement may not be assigned by any
party hereto without the prior express written consent of all other parties.
This Agreement may not be amended except by the express written consent of all
parties hereto.
17. GOVERNING LAW; VENUE. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without regard
to principles of conflicts of laws. If any action or proceeding shall be brought
by a party to this Agreement to enforce any right or remedy under this
Agreement, each party hereto hereby consents and will submit to the jurisdiction
of the courts of the State of New York or any federal court sitting in the
County, City and State of New York. Any action or proceeding brought by any
party to this Agreement to enforce any right, assert any claim or obtain any
relief whatsoever in connection with this Agreement shall be brought by such
party exclusively in the courts of the State of New York or any federal court
sitting in the County, City and State of New York.
18. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
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If the foregoing Agreement is satisfactory to you, please so indicate by
signing at the place provided below.
Accepted and Agreed: XXXXXX XXXXXXX XXXX XXXXXX SPECTRUM
SELECT L.P.
XXXX XXXXXX XXXXXXXX INC. By: Demeter Management Corporation,
General Partner
By: /s/ Xxxxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxxx
-------------------------- -------------------------------------
Xxxxxx X. Xxxxxx Xxxxxx X. Xxxxxx
Senior Vice President President
XXXXXX XXXXXXX XXXX XXXXXX SPECTRUM
TECHNICAL L.P.
By: Demeter Management Corporation,
General Partner
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------
Xxxxxx X. Xxxxxx
President
XXXXXX XXXXXXX XXXX XXXXXX SPECTRUM
STRATEGIC L.P.
By: Demeter Management Corporation,
General Partner
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------
Xxxxxx X. Xxxxxx
President
XXXXXX XXXXXXX XXXX XXXXXX SPECTRUM
GLOBAL BALANCED L.P.
By: Demeter Management Corporation,
General Partner
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------
Xxxxxx X. Xxxxxx
President
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XXXXXX XXXXXXX XXXX XXXXXX SPECTRUM
CURRENCY L.P.
By: Demeter Management Corporation,
General Partner
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------
Xxxxxx X. Xxxxxx
President
XXXXXX XXXXXXX XXXX XXXXXX SPECTRUM
COMMODITY L.P.
By: Demeter Management Corporation,
General Partner
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------
Xxxxxx X. Xxxxxx
President
DEMETER MANAGEMENT CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------
Xxxxxx X. Xxxxxx
President
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