THE WILLOWBRIDGE FUND L.P.
FORM OF AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT
This Amended and Restated Agreement of Limited Partnership made in
Princeton, New Jersey as of [___________] by and between Ruvane Investment
Corporation, a Delaware corporation (the "General Partner") and the other
parties who shall execute this Agreement, whether in counterpart, by
execution of a subscription agreement or other instrument, or otherwise, as
limited partners (individually, "Limited Partner" or collectively, "Limited
Partners"). (The General Partner and Limited Partners may be collectively
referred to herein as Partners".)
WITNESSETH:
WHEREAS, a limited partnership has been formed for the purpose of
trading in commodity interests as described below; and
WHEREAS, the Partners desire to amend and restate the Partnership
Agreement as originally adopted and subsequently amended and restated to
read as hereinafter set forth;
NOW, THEREFORE, the parties hereto agree that the Partnership
Agreement is hereby amended and restated to read as follows:
1. CONTINUATION AND NAME.
The parties hereto do hereby agree to continue the Partnership
under the Delaware Revised Uniform Limited Partnership Act, as amended and
in effect on the date hereof (the "Act"), and the rights and liabilities of
the Partners shall be as provided in the Act except as otherwise herein
provided. The name of the limited partnership is The Willowbridge Fund L.P.
(the "Partnership"). The General Partner shall execute and file an
amendment to the Certificate of Limited Partnership in accordance with the
provisions of the Act and shall execute, file, record and publish, as
appropriate, such amendments thereto, assumed name certificates and other
documents as are or become necessary or advisable as determined by the
General Partner. Each Limited Partner hereby agrees to furnish to the
General Partner a power of attorney which may be filed with the Certificate
of Limited Partnership and any amendments thereto and such additional
information as is required from such Limited Partner to complete such
documents and to execute and cooperate in the filing, recording or
publishing of such documents at the request of the General Partner.
2. PRINCIPAL OFFICE.
The principal office of the Partnership shall be at 0 Xxxxxxx
Xxxx, Xxxxxxxxx, Xxx Xxxxxx 00000, or such other place as the General
Partner may designate from time to time. The address of the registered
office and the registered agent of the Partnership in the State of Delaware
is 000 Xxxxx Xxxxx
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Xxxxxx, Xxxxx, Xxxxxxxx, and the name of the registered agent of the
Partnership in the State of Delaware is Xxxxxxxx-Xxxx Corporation System,
Inc.
3. BUSINESS.
The Partnership's business and purpose is to trade, buy, sell or
otherwise acquire, hold or dispose of commodity futures contracts, options
on physical commodities and on commodity futures contracts, forward
contracts, and any rights pertaining thereto and to engage in all
activities incident thereto. The objective of the Partnership business is
the appreciation of its assets through speculative trading.
4. TERM, DISSOLUTION, FISCAL YEAR AND DEFINITIONS.
(a) Term. The term of the Partnership shall end upon the first to
occur of the following: (1) December 31, 2006; (2) withdrawal, insolvency
or dissolution of the General Partner; (3) a decline of greater than 50% in
the Net Assets of the Partnership, as of the end of any month after the
commencement of trading, from the Net Assets of the Partnership as of the
beginning of each fiscal year (with appropriate adjustments for additions
or redemptions as consistently computed by the General Partner); or (4) the
occurrence of any event which shall make it unlawful for the existence of
the Partnership to be continued.
(b) Dissolution. Upon the occurrence of an event causing the
termination of the Partnership, the Partnership shall terminate and be
dissolved. Dissolution, payment of creditors and distribution of the
Partnership assets shall be effected as soon as practicable in accordance
with the Act, except that the General Partner and each Limited Partner (and
any assignee) shall share in the assets of the Partnership pro rata in
accordance with their respective Book Capital Accounts (as defined below),
less any amount owing by such Partner (or assignee) to Partnership.
(c) Fiscal Year. The fiscal year of the Partnership shall begin on
January 1, of each year (or the date of the inception of the Partnership
for the first fiscal year) and end on the following December 31.
(d) Certain Definitions. The Partnership's "Net Assets" shall mean
the total assets of the Partnership including all cash and cash equivalents
(valued at cost), accrued interest and the market value of all open
commodity positions and other assets maintained by the Partnership, less
the market value of all liabilities and reserves of the Partnership,
including accrued management and incentive fees, determined in accordance
with the principles specified in Paragraph 6 hereof and, where no principle
is specified, in accordance with generally accepted accounting principles.
The market value of a commodity futures contract or option on a commodity
futures contract shall mean the most recent available closing quotation on
the exchange, through which the particular commodity futures contract or
option on a commodity futures contract is traded by the Partnership; the
market value of a forward contract is determined by the dealer with which
the Partnership has traded the contract. If, however, a contract cannot be
liquidated on the day with respect to which the cumulative profits or
losses on the account are being determined, because of the operation of
daily limits or other rules of the commodity exchange upon which that
contract is traded or otherwise, the settlement price on the first
subsequent day on which the contract can be liquidated is the basis for
determining the liquidating value of such contract for such day.
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5. CAPITAL CONTRIBUTIONS AND PARTNERSHIP INTERESTS.
a. General Partner's Contribution. The General Partner shall
contribute to the capital of the Partnership, immediately prior to the time
the Partnership commences trading activity a general partnership
contribution in an amount equal to one percent of the aggregate capital
raised by the Partnership from time to time. The General Partner also may
from time to time make additional general partnership contributions to the
Partnership. The General Partner shall not make any assignment or transfer
of its general partnership capital contribution (to the extent, if at all,
that any such assignment, transfer, or withdrawal would otherwise be
permitted herein) if such action would reduce such capital contribution to
below one percent of the aggregate capital of the Partnership from time to
time. In addition to such general partnership contributions, the General
Partner and any trading advisors to the Partnership may purchase limited
partnership interests and will be treated as Limited Partners with respect
to such limited partnership interests; provided that the aggregate amount
of limited partnership interests purchased by the General Partner and any
party related to the General Partner within the meaning of Section 267(b)
or Section 707(b)(1) of the Internal Revenue Code of 1986, as amended (the
"Code"), shall not exceed 50% of aggregate limited partnership interests.
The General Partner shall, with respect to any limited partnership
interests owned by it, enjoy all of the rights and privileges and be
subject to all of the obligations and duties of a Limited Partner, except
as specified otherwise herein.
b. Limited Partners' Contributions. Interests in the Partnership,
other than the General Partner's general partnership interest, shall be
limited partnership interests. The General Partner may from time to time,
on behalf of the Partnership, issue and sell limited partnership interests.
Each Limited Partner shall contribute at least $10,000 to the capital of
the Partnership. The General Partner shall have the sole discretion to
accept or reject any subscription for any reason. The aggregate of all
contributions shall be available to the Partnership to carry on its
business. All subscriptions for limited partnership interests must be on
the form of subscription agreement provided in the then current Offering
Memorandum. Subscriptions for limited partnership interests must be paid in
full upon execution of a subscription agreement. Interests in the
Partnership, other than the General Partner's general partnership interest,
shall be limited partnership interests.
c. Continuing Offering. The General Partner on behalf of the
Partnership may offer, pursuant to the then current Offering Memorandum and
the terms hereof, any available limited partnership interests which remain
unsold. Aggregate partnership interests offered shall not exceed
$100,000,000. Proceeds from the sale of interests after the Initial Sales
Termination Date shall be deposited in an interest-bearing account at such
bank or financial institution (including a money market fund) as the
General Partner may select during the interim between the time when such
proceeds are received by the Partnership and the time when such proceeds
are booked to the subscriber's capital account (the first day of the next
calendar month) or rejected. The subscriber shall be paid any interest
earned on such proceeds during such interim period if his subscription is
rejected; otherwise, such interest will be paid to the Partnership. The
General Partner may terminate the offering of interests at any time.
d. Status as Limited Partner. A subscriber shall become a Limited
Partner in the Partnership upon receipt by the Partnership of the
subscription amount, acceptance of the subscription agreement, and upon
entry of the subscriber's name in the records of the Partnership as a
Limited Partner. In its discretion, the General Partner may cause the
withdrawal of any Limited Partner and the redemption of that Limited
Partner's interest in the Partnership pursuant to Paragraph 9(b) upon 10
days' written notice to such Limited Partner (or to any assignee of such
Partner's interest).
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6. ALLOCATION OF PROFITS AND LOSSES.
(a) Tax Capital Accounts. A Tax Capital Account shall be
established for each Partner. The initial balance of each Partner's Tax
Capital Account shall be the amount of its initial capital contribution to
the Partnership less the one-time administrative charge. Each Partner's Tax
Capital Account shall be increased by the amount of (i) any additional
capital contribution and (ii) the allocations to the Partner of Partnership
profit (or items thereof) as provided in subparagraph (f) hereof, and shall
be decreased by the amount of (i) money distributed to the Partner by the
Partnership and the fair market value of property distributed to the
Partner by the Partnership (net of liabilities securing such distributed
property), (ii) the allocations to the Partner of expenditures of the
Partnership described in Section 705(a)(2)(B) of the Code, and (iii) the
allocations to the Partner of Partnership loss (or items thereof) as
provided in subparagraph (f) hereof.
(b) Book Capital Accounts. A Book Capital Account shall be
established for each Partner. The initial balance of each Partner's Book
Capital Account shall be the amount of his initial capital contribution to
the Partnership less the one-time administrative charge. The balance of a
Partner's Book Capital Account shall be increased or decreased in
accordance with subparagraph (d) below and shall be further increased by
the amount of any additional capital contributions and decreased by the
amount of any redemptions or other distributions attributable to such
Partner.
(c) Monthly Determinations. As of the close of business (as
determined by the General Partner) on the last day of each month during
each fiscal year of the Partnership, the following determinations shall be
made:
(1) Realized and unrealized gains and losses from all trading
activities.
(2) The accrued quarterly management and incentive fee.
(3) Items of operating income, including without
limitation interest, and items of operating expense, including
without limitation commodity brokerage, legal and accounting fees,
if any.
(d) Monthly Allocations of Profit and Loss. As of the end of each
month, the amounts determined in subparagraph (c) above will be allocated
(charged) proportionately to the Partners' Book Capital Accounts based on
the amount of each Partner's Book Capital Account at the beginning of the
month.
(e) Allocation of Profit and Loss for Federal Income Tax Purposes.
As of the end of each calendar year, the Partnership's realized profit or
loss shall be allocated among the Partners for federal income tax purposes.
For purposes of determining the character of the realized profit and loss
allocated to each Partner for federal income tax purposes, a distinction
will be made between net short-term capital gain or loss and net long-term
capital gain or loss. The Partnership's gross realized profit or loss shall
be allocated first to each Partner who redeemed its or his entire general
or limited partnership interest so that such Partner's Tax Capital Account
is equal to its or his Book Capital Account immediately prior to the
redemption. Any remaining net realized profit or loss shall then be
allocated to the Partners in order to decrease the relative differences
between the Partners' Tax Capital Account and Book Capital Account in
accordance with Treasury Regulation 1.7041(b)(2)(iv)(g), provided, however,
that the
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allocations of such profit and loss to the Partners shall not exceed the
allocations permitted under Subchapter K of the Code as determined by the
General Partner, whose determination shall be binding.
(f) Expenses. The General Partner, not the Partnership, will pay
all organizational expenses and the expenses of the sale of limited
partnership interests. All of the expenses which are for the Partnership's
account shall be billed directly to the Partnership. The General Partner
shall not be reimbursed by the Partnership for any costs incurred by it
relating to office space, equipment, and staff necessary for Partnership
operations. The Partnership shall be obligated to pay all other liabilities
incurred by it, including, without limitation, management and incentive
fees to advisors, commodity brokerage commissions, clearing, National
Futures Association, legal and audit fees. Appropriate reserves may be
created, accrued and charged against Net Assets of the Partnership and
proportionately against the Book Capital Accounts of the Partners for
contingent liabilities, if any, as of the date any such contingent
liability becomes known to the General Partner, such reserves to be in an
amount as the General Partner in its sole discretion deems necessary or
appropriate.
(g) Limited Liability of Limited Partners. Each limited
partnership interest, when purchased by a Limited Partner, shall be fully
paid and nonassessable, except with respect to amounts distributed to the
holders of limited partnership interests through redemption of limited
partnership interests, distribution of Partnership income or capital, or
otherwise; provided, however, no Limited Partner shall be liable for
Partnership obligations in excess of the capital contributed by him, and
his share of profits (if any), including any distributions and amounts
received upon redemption of limited partnership interests, together with
interest thereon.
(h) Return of Capital Contributions. Except to the extent that a
General or Limited Partner shall have the right to withdraw capital through
redemption of general or limited partnership interests or shall be entitled
to withdrawals or distributions in accordance with the terms of this
Agreement, no General or Limited Partner shall have any right to demand the
return of his capital contributions or any profits added thereto, except
upon termination and dissolution of the Partnership. In no event shall a
Limited Partner be entitled to demand or receive property other than cash.
(i) Distributions. The General Partner shall have sole discretion
in determining what distributions (other than on redemption of limited
partnership interests), if any, the Partnership will make to its Partners.
All distributions shall be pro rata in accordance with the respective Book
Capital Accounts of the Partners.
7. MANAGEMENT.
(a) Management of the Partnership. The General Partner, to the
exclusion of all Limited Partners, shall conduct and manage the business of
the Partnership including, without limitation, the investment of the funds
of the Partnership. The General Partner may delegate its responsibility for
providing administrative services to the Partnership. The General Partner
shall monitor the trading and performance of the advisors to the
Partnership and shall not permit churning of the Partnership's account. The
General Partner shall be entitled to receive on the first business day of
each new fiscal year of the Partnership as compensation for the management
services which it renders on behalf of the Partnership an annual management
fee in an amount equal to 1% of the assets of the Partnership as of the
last day of the fiscal year just concluded. The General Partner is
authorized to pay to itself and certain persons who introduce subscribers
to the Partnership a percentage of the brokerage commissions charged to the
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Partnership as compensation for their services in connection with the
Partnership; the amount of such compensation shall be determined by the
General Partner in its sole discretion. Except as provided herein, no
Partner shall be entitled to any salary, draw, or other compensation from
the Partnership. Each Limited Partner hereby agrees to furnish to the
General Partner such additional information as may be deemed by the General
Partner to be required or appropriate to open and maintain an account or
accounts with commodity brokerage firms for the purpose of trading in
commodity futures contracts.
(b) Retention of Trading Advisors and Commodity Broker. The
General Partner may make investment decisions regarding the Partnership
itself or may retain one or more trading advisors (who may be its
affiliates) to make such investment decisions, and the General Partner may
delegate complete trading discretion to any such advisor or advisors. The
General Partner is hereby authorized (i) to employ trading advisor(s) from
time to time on such terms as it may approve and to terminate any advisory
agreement at its discretion in accordance with its terms; (ii) to enter
into customer agreements with commodity broker(s); and (iii) to pay
brokerage fees at the rates provided for in the applicable customer
agreement and such rates for trading in the cash and forward markets which
the commodity broker(s) may charge from time to time.
(c) Other Powers. The General Partner may take such other actions
as it deems necessary or desirable to manage the business of the
Partnership including, but not limited to, the following: opening bank
accounts; paying or authorizing the payment of distributions to the
Partners and expenses of the Partnership such as management and performance
fees, legal and accounting fees, and registration and other fees of
governmental agencies; and investing or directing the investment of funds
of the Partnership not being utilized as cash margin deposits. The General
Partner is hereby authorized to perform all duties imposed by Sections 6221
through 6232 of the Code on the General Partner as "tax matters partner" of
the Partnership, including (but not limited to) the following: (a) the
power to conduct all audits and other administrative proceedings with
respect to Partnership tax items; (b) the power to extend the statute of
limitations for all Limited Partners with respect to Partnership tax items;
(c) the power to file a petition with an appropriate federal court for
review of a final Partnership administrative adjustment; (d) the power to
enter into a settlement with the Internal Revenue Service on behalf of, and
binding upon, those Limited Partners having less than a 1% interest in the
Partnership unless a Limited Partner notifies the Internal Revenue Service
and the General Partner that the General Partner may not act on his behalf.
The Partnership shall reimburse the General Partner for all costs and
expenses incurred by the General Partner in its capacity as Tax Matters
Partner. The General Partner may, in its sole discretion, make or refrain
from making the election contemplated by Section 754 of the Code on behalf
of the Partnership, and determine how to classify items of income, gain,
expense or profit for federal or state income tax purposes on the
Partnership's tax returns and the Form K-1s (or any successor form)
transmitted to the Limited Partners. The General Partner shall withhold
from income allocated to any foreign Partner any amount that it deems
required by the Code, including Section 1441, 1442, or 1446 thereof, and
any regulations thereunder or administrative interpretations thereof. Any
amount withheld shall be paid over to the United States Treasury and shall
be charged against the foreign Partner's Capital Account.
(d) Records. The General Partner shall keep and retain such books
and records relating to the business of the Partnership as it deems
necessary or advisable or as are required by the Commodity Exchange Act or
the regulations of the Commodity Futures Trading Commission (the "CFTC") at
the principal office of the Partnership or such other office as the General
Partner deems advisable for not less than six years from the date of this
Agreement. Any Subscription Agreement and Power of Attorney executed by a
Limited Partner in connection with his purchase of limited partnership
interests shall be
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retained by the Partnership for not less than six years from the date of
such agreement.
(e) Activity of General Partner. The General Partner may engage in
other business activities and shall not be required to refrain from any
other activity or disgorge any profits from any such activity, whether as
general partner of additional partnerships for investment in commodity
futures contracts or otherwise. The General Partner, on behalf of the
Partnership, may engage and compensate from funds of the Partnership such
persons, firms or corporations, including any affiliated person or entity
or any other person or entity, as the General Partner in its sole judgment
shall deem advisable for the conduct and operation of the business of the
Partnership.
(f) Reliance by Third Parties. No person dealing with the General
Partner shall be required to determine its authority to make any
undertaking on behalf of the Partnership, nor determine any fact or
circumstance bearing upon the existence of its authority.
(g) Exculpation. The General Partner, its officers, directors,
stockholders, employees, agents and affiliates and each person who controls
any of the same shall not be liable, responsible or accountable in damages
or otherwise to the Partnership or to any of the Partners, their successors
or permitted assigns, except by reason of acts or omissions (i) in
violation of federal or state securities laws, (ii) due to intentional or
criminal wrongdoing or gross negligence or willful misconduct, (iii) breach
of fiduciary duty, or (iv) for not having acted in good faith in the
reasonable belief that its actions were in, or not opposed to, the best
interests of the Partnership.
8. REVIEW AND REPORTS TO LIMITED PARTNERS.
The Partnership's books shall be audited annually by independent
public accountants. The Partnership will use its best efforts to cause each
Partner to receive (i) such reports (in such detail) as are required to be
given to Limited Partners by the CFTC, (ii) any other reports (in such
detail) required by any other governmental authority which has jurisdiction
over the activities of the Partnership, and (iii) within 75 days after the
close of each fiscal year such Partnership tax information as is necessary
for him to complete his federal income tax return.
9. TRANSFER AND REDEMPTION FROM CAPITAL ACCOUNTS.
(a) Transfer. If the General Partner, its stockholders and any
person related to the General Partner or its stockholders within the
meaning of Sections 267(b) or 707(b)(1) of the Code own in the aggregate
80% or more of the aggregate partnership interests in the Partnership, no
such interest owned by any such person may be transferred, assigned,
pledged or encumbered except that, if there are Limited Partners other than
the persons described above which in the aggregate have at least a 1%
interest in Partnership income, gain, loss, deduction, credit and capital,
this restriction on transfer, assignment, pledge or encumbrance will not
apply if all such other Limited Partners consent in writing thereto. Such
consent shall be granted or denied in the sole discretion of each such
Limited Partner. The General Partner may transfer, assign, pledge or
encumber its general partnership interest subject to the limitations in the
preceding two sentences, and a Limited Partner may transfer, assign, pledge
or encumber its partnership interest (or any portion thereof) only as
provided herein. No such transferee, assignee, pledgee, or secured creditor
shall become a substituted Limited Partner unless the General Partner first
consents to such substitution in writing, which consent shall be granted or
denied in the sole discretion of the General Partner. Any transfer,
assignment, pledge or encumbrance of interests permitted
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hereunder shall be effective as of the end of the month in which such
transfer, assignment, pledge or encumbrance is made, provided that the
Partnership need not recognize any transfer, assignment, pledge, or
encumbrance unless it has received at least 20 days' prior written notice
thereof from the Limited Partner, which notice shall set forth the address
and social security or taxpayer identification number of the transferee,
assignee, pledgee, or secured creditor and the portion of the limited
partnership interest transferred, assigned, pledged or encumbered. Such
notice shall be signed by the Limited Partner and notarized. No transfer,
assignment, pledge or encumbrance shall be permitted unless the General
Partner is satisfied that (i) such transfer, assignment, pledge or
encumbrance would not be in violation of the Act or applicable securities
laws, (ii) the Partnership shall continue to be classified as a partnership
rather than as an association taxable as a corporation for federal tax
purposes, and (iii) it has received all documentation it may reasonably
request. Any transferee, assignee, pledgee, or secured creditor of
interests who has not been admitted to the Partnership as a substituted
Limited Partner shall not have any of the rights of a Limited Partner,
except that such person shall receive that share of capital and profits and
shall have the right of redemption to which his transferor, assignor,
pledgor, or debtor would otherwise have been entitled and shall remain
subject to the other terms of this Agreement binding upon Limited Partners.
The Limited Partner shall bear all costs (including any attorneys' fees)
related to such transfer, assignment, pledge, or encumbrance of his
interest (or portion thereof). No transfer, assignment, pledge or
encumbrance shall be permitted of any interest (or portion thereof) which
has a fair market value that is less than $10,000.
(a) Redemption of Limited Partnership Interest. The General
Partner will redeem for cash all of a Limited Partner's interest in the
Partnership for an amount equal to the balance of such Limited Partner's
Book Capital Account at the close of business on the Redemption Date (as
defined below) (after taking into account the adjustment provided for in
Paragraph 6(d)), less any amount owing by such Partner (and his assignee,
if any) to the Partnership. Such redemption shall occur on the last day of
any calendar month ("Redemption Date") 10 days after a request for
redemption in proper form has been delivered to the General Partner. If
redemption is requested by an assignee, all amounts owed to the Partnership
by the Partner to whom such limited partnership interest was sold as well
as all amounts owed to the Partnership by all assignees of such limited
partnership interest shall be charged to the balance of the subject Book
Capital Account upon redemption by an assignee. A "request for redemption"
shall mean a letter sent by a Limited Partner (or assignee thereof) and
received by the General Partner at least 10 days in advance of the date
redemption is requested, which shall be the last day of the calendar month.
In such request, the Limited Partner must represent and warrant that he is
the true, lawful, and beneficial owner of the subject limited partnership
interest with full power and authority to request the redemption and must
further represent that such limited partnership interest is not subject to
any encumbrances. The signature of the Limited Partner requesting the
redemption must be guaranteed by a commercial bank or by a member of either
a national securities exchange or the National Association of Securities
Dealers, Inc. The General Partner may, in its sole discretion, waive any
notice period or the requirement of a guaranteed signature, provided that,
in the opinion of the General Partner, the Partnership will not be
prejudiced by such action. Notwithstanding the foregoing, the General
Partner may in its sole discretion from time to time cause the redemption
of a Limited Partner's interest in the Partnership upon 10 days' prior
written notice to the Limited Partner (or any assignee of such Partner's
interest), which notice shall specify the Redemption Date. With respect to
all redemptions, payment will be made within 30 days after the Redemption
Date, except that, under special circumstances including but not limited to
the inability on the part of the Partnership to liquidate commodity
positions as of such Redemption Date or default or delay in payments due
the Partnership from commodity brokers, banks or other persons, the
Partnership may delay payment to Partners whose interests are being
redeemed.
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(b) Withdrawals by General Partner. The General Partner may make
withdrawals from its Book Capital Account as of the last day of any month
in any amount in excess of its capital contribution required by paragraph
5(b).
(c) Bookkeeping. All additions made to a Partner's Book Capital
Account will be booked as of the beginning of the month in which they
become effective. All redemptions will be based on the appropriate month
end balance of a Partner's Book Capital Account and will be booked as of
the end of that month.
10. ADMISSION OF ADDITIONAL PARTNERS; ADDITIONAL CAPITAL CONTRIBUTIONS.
At its discretion, the General Partner may admit additional
Limited or General Partners to the Partnership and accept additional
capital contributions from existing Partners as of the first day of any
month after the Partnership has been formed and begun trading. Pursuant to
Paragraph 9, the General Partner may consent to and admit any assignee of a
limited partnership interest as a substituted Limited Partner. Any
additional capital contributions made by a Partner shall be credited to
such Partner's Book Capital Account.
11. NOT TO BE SUBJECT TO CORPORATE TAX AS A PUBLICLY TRADED PARTNERSHIP.
(a) All interests in the Partnership have been or will be issued
in a transaction or transactions that were not required to be registered
under the Securities Act of 1933 (the "1933 Act"), and to the extent such
offerings or sales were not required to be registered under the 1933 Act by
reason of Regulation S (17 CFR 230.901 through 230.904) or any successor
thereto, such offerings or sales would not have been required to be
registered under the 1933 Act if the interests so offered or sold had been
offered and sold within the United States.
(b) Neither the General Partner nor the Partnership will
participate in the interests in the Partnership being traded on an
established securities market. For purposes of the preceding sentence, an
established securities market is a national securities exchange that is
either registered under Section 6 of the Securities Exchange Act of 1934
(the "1934 Act") or exempt from registration because of the limited volume
of transactions, a foreign securities exchange that, under the law of the
jurisdiction where it is organized, satisfies regulatory requirements that
are analogous to the regulatory requirements of the 1934 Act, a regional or
local exchange, or an interdealer quotation system that regularly
disseminates firm buy or sell quotations by identified brokers or dealers
by electronic means or otherwise.
(c) Notwithstanding anything to the contrary in this Partnership
Agreement, for each taxable year of the Partnership, pursuant to Sections
7704(c) and 7704(d) of the Code, the principal activity of the Partnership
has consisted and will consist of entering into and buying for investment
purposes futures and forward contracts on foreign currencies and
commodities (which are capital assets to the Partnership) and at least 90%
of the Partnership's gross income for each taxable year of the Partnership
has constituted and will constitute "qualifying income" under such
provisions in the form of gains from such trading and other qualifying
income, including interest income.
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12. SPECIAL POWER OF ATTORNEY.
(a) Each Limited Partner by the execution of this Agreement does
irrevocably constitute and appoint the General Partner with the power of
substitution, as his true and lawful attorney-in-fact, in his name, place
and xxxxx, to execute, acknowledge, swear to, file and record in his behalf
in the appropriate public offices and publish (i) this Agreement and a
Certificate of Limited Partnership, including amendments thereto; (ii) all
instruments which the General Partner deems necessary or appropriate to
reflect any amendment, change or modification of the Partnership in
accordance with the terms of this Agreement; (iii) certificates of Assumed
Name; (iv) all instruments which the General Partner deems necessary or
appropriate to qualify the Partnership to do business as a foreign limited
partnership in other jurisdictions; (v) customer agreements with any
dealers, commodity brokerage firms or banks; (vi) advisory agreements with
any commodity trading advisors and (vii) such other certificates or
instruments (including amendments or modifications of any of the foregoing)
as may be required to be filed by the Partnership or the Partners under the
laws of the State of Delaware or any other jurisdiction or as the General
Partner may deem necessary or desirable to carry out the purpose and intent
of this Agreement. The Power of Attorney granted herein shall be
irrevocable and deemed to be a power coupled with an interest and shall
survive the death, legal incapacity, insolvency or dissolution of a Limited
Partner or the delivery of any assignment by a Limited Partner of the whole
or any portion of his interest, and any assignee of a Limited Partner does
hereby constitute each person from time to time serving as an officer of
the General Partner his attorney in the same manner and with the same force
and for the same purposes as does the assignor. Each Limited Partner hereby
agrees to be bound by any representation made by the General Partner and by
any successor thereto, acting in good faith pursuant to such Power of
Attorney, and each Limited Partner hereby waives any and all defenses which
may be available to contest, negate or disaffirm the action of the General
Partner and any successor thereto, taken in good faith under such Power of
Attorney.
(b) Each Limited Partner agrees to execute such special Power(s)
of Attorney on documents separate from this Agreement as the General
Partner may request. In the event of any conflict between this Agreement
and any instruments filed by such attorney pursuant to the Power of
Attorney granted in this Paragraph, this Agreement shall control.
13. WITHDRAWAL OF A PARTNER.
The Partnership shall terminate and be dissolved upon the
withdrawal, insolvency or dissolution of the General Partner. The General
Partner shall not withdraw from the Partnership without giving the Limited
Partners forty-five days' prior written notice. The death, incompetency,
withdrawal, insolvency or dissolution of a Limited Partner shall not
terminate or dissolve the Partnership, and such Limited Partner, his
estate, custodian or legal representative shall have no right to withdraw
or value such Limited Partner's interest in the Partnership except as
provided in Paragraph 9 hereof. Each Limited Partner (and any assignee of
such Partner's interest) expressly agrees that in the event of his death,
he waives on behalf of himself and his estate, and he directs the legal
representative of his estate and any person interested therein to waive,
the furnishing of any inventory, accounting, or appraisal of the assets of
the Partnership and any right to an audit or examination of the books of
the Partnership. If a Limited Partner who is an individual dies or a court
of competent jurisdiction adjudges him to be incompetent to manage his
person or his property, the Limited Partner's executor, administrator,
guardian, conservator or other legal representative may exercise all of the
Limited Partner's rights for the purpose of settling his estate or
administering his property, but no such person or entity shall become a
substituted Limited Partner
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unless the requirements of Section 9 of this Agreement are met. If a
Limited Partner is a corporation, trust, or other entity and is dissolved
or terminated, the powers of that Limited Partner may be exercised by its
legal representative or successor.
14. NO PERSONAL LIABILITY FOR RETURN OF CAPITAL OR PROFITS.
The General Partner shall not be personally liable for the return
or repayment of all or any portion of the capital or profits of any Partner
(or assignee), it being expressly agreed that any such return of capital or
profits made pursuant to this Agreement shall be made solely from the
assets (which shall not include any right of contribution from the General
Partner) of the Partnership.
15. INDEMNIFICATION.
(a) Indemnification of General Partner. The Partnership shall
indemnify, defend and hold harmless the General Partner and its officers,
directors, stockholders, employees, agents and affiliates and each person,
if any, who controls any of them from and against any loss, liability,
damage, cost or expense (including legal fees and expenses incurred in
defense of any demands, claims or lawsuits) actually and reasonably
incurred arising from actions or omissions concerning the business or
activities undertaken by or on behalf of the Partnership from any source
including, without limitation, any demands, claims or lawsuits initiated by
a Limited Partner, if the acts, omissions or alleged acts or omissions upon
which such actual or threatened action, proceeding, or claim is based were
for a purpose reasonably believed to be in, or not opposed to, the best
interests of the Partnership and were not (i) in violation of federal or
state securities laws, (ii) performed or omitted as a result of intentional
or criminal wrongdoing or gross negligence or willful misconduct or (iii)
in violation of the General Partner's fiduciary obligations to the
Partnership. All rights to indemnification and payment of legal fees and
expenses shall not be affected by the termination of the Partnership or the
withdrawal, dissolution or insolvency of the General Partner.
(b) Indemnification by Partners. In the event the Partnership is
made a party to any claim, dispute or litigation or otherwise incurs any
loss or expense as a result of or in connection with any Partner's (or
assignee's) obligations or liabilities unrelated to the Partnership's
business, such Partner (or assignees cumulatively) shall indemnify and
reimburse the Partnership for all loss and expense incurred, including
reasonable attorneys' and accountants' fees.
16. AMENDMENTS.
Amendments to this Agreement may be proposed by the General
Partner or by Limited Partners owning not less than 10% of the then
outstanding limited partnership interests (not including any limited
partnership interests held by the General Partner). Within 30 days
following receipt of a proposal, the General Partner shall submit the
proposed amendment to the Limited Partners, and the General Partner shall
make its recommendation with regard to each such proposal. A majority of
the then outstanding limited partnership interests (not including any
limited partnership interests held by the General Partner) shall be
required to pass an amendment. For purposes of obtaining a written vote,
the General Partner may require responses to be made within a specified
time.
This Agreement may be amended by the General Partner, upon 30
days' prior notice to each Partner, as to the following matters: (a) to add
to the duties or obligations of the General Partner or
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surrender any right or power granted to the General Partner herein, for the
benefit of the Limited Partners; (b) to cure any ambiguity, to correct or
supplement any provision in this Agreement which may be inconsistent with
any other provision, or to add any other provisions with respect to matters
or questions arising under this Agreement which will not result in
inconsistency with the provisions of this Agreement; or (c) to delete from
or add any provision to this Agreement required or deemed necessary to be
so deleted or added by representatives of the Securities and Exchange
Commission, the CFTC or any other governmental agency or authority for the
benefit or protection of the Limited Partners.
No amendment, whether proposed by the General Partner or Limited
Partners, shall cause the Partnership to become a general partnership,
change the liability of the General Partner or the Limited Partners so as
to materially and adversely affect any Partner, change any Partner's share
of the profits or losses of the Partnership without the consent of such
Partner, extend the duration of the Partnership, or change the provisions
of this paragraph.
17. GOVERNING LAW.
The validity and construction of this Agreement shall be governed
by and construed in accordance with the laws of the State of Delaware.
18. MISCELLANEOUS.
(a) Priority Among Limited Partners. Except as otherwise may be
specifically set forth in this Agreement, no Limited Partner shall be
entitled to any priority or preference over any other Limited Partner in
regard to the affairs of the Partnership.
(b) Notices. All notices under this Agreement, other than reports
by the General Partner to the Limited Partners, shall be in writing and
shall be effective upon personal delivery, or if sent by air courier or
registered or certified mail, postage prepaid, addressed to the last known
address of the party to whom such notice is to be given, upon the deposit
of such notice in the United States mail. Reports by the General Partner to
the Limited Partners shall be in writing and shall be sent by first class
mail to the latest known address of each Limited Partner.
(c) Binding Effect. This Agreement shall inure to the benefit of
and be binding upon all of the parties, their successors, assigns as
permitted herein, custodians, estates, heirs and personal representatives.
For purposes of determining the rights of any Partner or assignee
hereunder, the Partnership and the General Partner may rely upon the
Partnership records as to who are Partners and assignees and all Partners
and assignees agree that their rights shall be determined and that they
shall be bound thereby.
(d) Captions. Captions in no way define, limit, extend or describe
the scope of this Agreement nor the effect of any of its provisions.
(e) Severability. If any provision of this Agreement or the
application of such provision to any person or circumstance shall be held
invalid, the remainder of this Agreement, or the application of such
provision to persons or circumstances, other than those as to which it is
held invalid, shall not be affected thereby.
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(f) Tax Status of Partnership. If, by reason of any provision or
provisions of this Agreement, the Internal Revenue Service shall assert the
position that the Partnership shall not be deemed to be a partnership for
purposes of the federal income tax laws, then said provision or provisions
of this Agreement shall not be operative.
(g) Limited Liability. If, by any reason of any provision or
provisions of this Agreement, the Limited Partners shall be deemed to be
liable as general partners rather than limited partners, then said
provision or provisions of this Agreement shall not be operative.
(h) Counterparts. This Agreement and the subscription agreement
may be executed in counterparts, each of which shall be considered an
original and all of which counterparts of each agreement shall constitute
one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
General Partner:
RUVANE INVESTMENT CORPORATION
By__________________
Xxxxxx X. Xxxxxx
President
Limited Partners:
Those Limited Partners, together
owning 100% of the limited partnership
interests in the Partnership, who have
executed the Consent dated
as of ___________________
By: RUVANE INVESTMENT
CORPORATION, the General Partner, as
attorney-in-fact
By:______________________
Xxxxxx X. Xxxxxx
President
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