EXHIBIT 1
LIMITED PARTNERSHIP AGREEMENT
OF
SUG 1, L.P.
Dated as of December 30, 1999
TABLE OF CONTENTS
Page
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ARTICLE I General Provisions..............................
Section 1.01 Partnership Name and Address.............
Section 1.02 Fiscal Year and Fiscal Quarters..........
Section 1.03 Partners, Profits and Liabilities........
Section 1.04 Purpose of Partnership...................
Section 1.05 Assignability of Interest................
Section 1.06 Computations and Calculations............
ARTICLE II Management of Partnership......................
Section 2.01 Management Generally.....................
Section 2.02 Authority of the General Partner.........
Section 2.03 Reliance by Third Parties................
Section 2.04 Activity of the General Partner..........
Section 2.05 Exculpation..............................
Section 2.06 Indemnification of General Partner.......
ARTICLE III Capital Accounts of Partners and
Operation Thereof.............................
Section 3.01 Definitions..............................
Section 3.02 Initial Capital Contributions............
Section 3.03 Capital Accounts.........................
Section 3.04 Partnership Percentages..................
Section 3.05 Liabilities..............................
Section 3.06 Allocation for Tax Purposes..............
Section 3.07 Determination by General Partner
of Certain Matters.......................
Section 3.08 Adjustment to Take Account of
Interim Year Events......................
ARTICLE IV Withdrawals and Distributions of Capital.......
Section 4.01 Withdrawals and Distributions in General.
Section 4.02 Distribution.............................
Section 4.03 Withdrawals..............................
ARTICLE V Withdrawal, Death and Disability................
Section 5.01 Withdrawal, Death, etc. of
Limited Partners.........................
Section 5.02 Required Withdrawals.....................
ARTICLE VI Duration and Dissolution of Partnership........
Section 6.01 Duration.................................
Section 6.02 Dissolution..............................
ARTICLE VII Tax Returns; Reports to Partners..............
Section 7.01 Filing of Tax Returns....................
Section 7.02 Tax Matters Partner......................
Section 7.03 Reports to Current Partners..............
Section 7.04 Reports to Partners and Former Partners..
ARTICLE VIII Miscellaneous................................
Section 8.01 General..................................
Section 8.02 Power of Attorney........................
Section 8.03 Amendments to Partnership Agreement......
Section 8.04 Choice of Law............................
Section 8.05 Adjustment of Basis of Partnership
Property.................................
Section 8.06 Notices..................................
Section 8.07 Goodwill.................................
Section 8.08 Headings.................................
Section 8.09 Pronouns.................................
INDEX OF DEFINED TERMS
Term Section
Accounting Period Section 3.01(a)
Affiliate Section 3.01(b)
Agreement Introductory Paragraph
Associates Section 2.04
Book Value of the Withdrawal Interest Section 4.03(i)
Capital Account Section 3.03
Capital Contributions Section 1.03
Claim Section 2.06
Code Section 3.06
control Section 3.01(b)
Distribution Date Section 4.03(ii)
Fiscal Quarter Section 1.02
Fiscal Year Section 1.02
former Limited Partner Section 1.03
former Partner Section 1.03
General Partner Introductory Paragraph
Indemnified Party Section 2.06
Initial Capital Contribution Section 3.02
interest in the Partnership Section 1.03
interests in the Partnership Section 1.03
Limited Partners Introductory Paragraph
Other Account Section 2.02(e)
Partners Introductory Paragraph
Partnership Introductory Paragraph
Pass-Thru Partner Section 7.02
person Section 1.05
Securities Section 1.04(a)
Security Section 1.04(a)
Withdrawal Date Section 4.03(iii)
Withdrawal Distribution Section 4.03(iv)
Withdrawal Documents Section 4.03(v)
Withdrawal Interest Section 4.03(vii)
Withdrawal Partner Section 4.03(viii)
Withdrawal Request Section 4.03(vi)
LIMITED PARTNERSHIP AGREEMENT
OF
SUG 1, L.P.
Dated as of December 30, 1999
This limited partnership agreement (the "Agreement") of SUG 1,
L.P. (the "Partnership") is dated as of December 30, 1999 by and
among ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ (the "General Partner") and
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and all other persons who shall in the future
become limited partners in accordance with the provisions hereof
(the "Limited Partners") (collectively, the "Partners") which
term shall include any persons hereafter admitted to the Partner-
ship pursuant to Article V of this Agreement and shall exclude
any persons who cease to be Partners pursuant to Article VI of
this Agreement).
WHEREAS, the parties hereto wish to create a limited partnership
on the terms set forth herein and have organized the Partnership
under the Delaware Revised Uniform Limited Partnership Act (6 Del
C. Section 17-101 et seq.);
NOW, THEREFORE, for and in consideration of the foregoing and the
mutual covenants hereinafter set forth, it is hereby agreed as
follows:
ARTICLE I
General Provisions
Section 1.01 Partnership Name and Address. The name of the
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Partnership is SUG 1, L.P. Its principal office is located at
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or at
such other location as the General Partner in the future may
designate. The General Partner shall promptly notify the Limited
Partners of any change in the Partnership's address.
Section 1.02 Fiscal Year and Fiscal Quarters. The fiscal year
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of the Partnership (herein called the "Fiscal Year") shall end on
December 31 of each calendar year. The fiscal quarter of the
Partnership (each such quarter herein referred to as a "Fiscal
Quarter") shall end on March 31, June 30, September 30 and
December 31 of each calendar year.
Section 1.03 Partners, Profits and Liabilities. The capital
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contributions of each Partner to the Partnership shall be the
amount of cash and the fair market value of any other assets
contributed initially or at any time thereafter to the Partner-
ship by such Partner, net of liabilities assumed or to which the
assets are subject ("Capital Contributions"). The General Part-
ner shall determine on a reasonable basis the fair market value
of any assets contributed to the Partnership by a Partner, which
determination shall be final, conclusive and binding upon all of
the Partners.
Except as provided to the contrary herein, no Partner shall be
entitled to interest on such Partner's Capital Contributions nor
shall any Partner be entitled to demand the return of all or any
part of such Capital Contributions. All cash, Securities (as
defined in Section 1.04) or other property distributed by the
Partnership shall be allocated to each Partner in the proportion
of such Partner's Partnership Percentage (as defined in Section
3.04). All profits of the Partnership, as determined for federal
income tax purposes, shall be allocated to the Partners in the
same manner and proportion as distributions of cash, Securities
or other property is allocated among the Partners in accordance
with this Section.
Except as provided in Section 2.05, the General Partner shall
have unlimited liability for the repayment and discharge of all
debts and obligations of the Partnership.
The Limited Partners, and former Limited Partners, shall be
liable for the repayment and discharge of all debts and obliga-
tions of the Partnership attributable to any Fiscal Year (or
relevant portion thereof) during which they are or were Limited
Partners of the Partnership to the extent of their interests in
the Partnership in the Fiscal Year (or relevant portion thereof)
to which any such debts and obligations are attributable.
The Partners and all former Partners shall share all losses,
liabilities or expenses suffered or incurred by virtue of the
operation of this Section 1.03 in the proportions of their
respective Partnership Percentages (as defined in Section 3.04)
for the Fiscal Year (or relevant portion thereof) to which any
debts or obligations of the Partnership are attributable. A
Limited Partner's or former Limited Partner's share of all
losses, liabilities or expenses shall not be greater than such
Limited Partner's interest in the Partnership for such Fiscal
Year (or relevant portion thereof). The General Partner shall be
liable for the losses, liabilities or expenses suffered or
incurred by virtue of the operation of the third paragraph of
this Section 1.03 in excess of the interests of the Limited
Partners or former Limited Partners in the Partnership in the
Fiscal Year (or relevant portion thereof) to which any debts or
obligations are attributable.
As used in this Section 1.03, the term "interest in the Partner-
ship" and "interests in the Partnership" shall mean with respect
to any Fiscal Year (or relevant portion thereof) and with respect
to each Partner (or former Partner) the Capital Account (as
defined in Section 3.03) that such Partner (or former Partner)
would have received (or in fact did receive) pursuant to the
terms and provisions of Article VI upon withdrawal from the
Partnership as of the end of such Fiscal Year (or relevant
portion thereof).
Notwithstanding any other provision in this Agreement, in no
event shall any Limited Partner (or former Limited Partner) be
obligated to make any additional contribution whatsoever to the
Partnership, or have any liability for the repayment and
discharge of the debts and obligations of the Partnership (apart
from such Limited Partner's interest in the Partnership), except
that a Limited Partner may be required, for purposes of meeting
such Limited Partner's obligation under this Section 1.03, to
make additional contributions or payments, respectively, up to,
but in no event in excess of, the aggregate amount of returns of
capital and other amounts actually received by such Limited
Partner from the Partnership during or after the Fiscal Year to
which any debt or obligation is attributable.
As used in this Agreement, the terms "former Limited Partner" and
"former Partner" refer to such persons or entities as hereafter
from time to time cease to be a Limited Partner or Partner, re-
spectively, pursuant to the terms and provisions of this Agree-
ment.
Section 1.04 Purpose of Partnership. The Partnership is
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organized for the following purposes:
(a) to engage in lawful Securities (as defined below) transac-
tions as the General Partner may from time to time deter-
mine, including, without limitation, investments in capital
stock, options or warrants (all such items being called
herein a "Security" or "Securities"), selling Securities,
selling Securities short, and covering such short sales;
(b) to possess, transfer, mortgage, pledge or otherwise deal in,
and to exercise all rights, powers, privileges and other
incidents of ownership or possession with respect to the
Securities and other property and funds held or owned by the
Partnership;
(c) to enter into custodial arrangements regarding Securities
owned beneficially by the Partnership with banks and brokers
wherever located;
(d) to engage personnel, whether part-time or full-time, and
attorneys, independent accountants or such other persons as
the General Partner may deem necessary or advisable; and
(e) to do such other acts as the General Partner may deem
necessary or advisable in connection with the maintenance
and administration of the Partnership.
Section 1.05 Assignability of Interest. Without the prior
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written consent of the General Partner, which may be withheld in
its sole discretion, a Partner may not (i) pledge or assign such
Partner's interest in the Partnership in whole or in part to any
person except by operation of law, or (ii) designate as a partner
any other person as a substitute for such Partner. Notwith-
standing the foregoing, the General Partner may designate any
Affiliate (as defined in Section 3.01) of the General Partner to
be substituted as General Partner. Any assignee shall constitute
a new General or Limited Partner; provided, such person executes
an appropriate supplement to this Agreement pursuant to which
such person agrees to be bound by the terms and provisions of
this Agreement. Admission of a new Partner pursuant hereto shall
not cause a dissolution of the Partnership. In no event shall
the Partnership have more than twenty (20) Partners, as deter-
mined in accordance with either Treasury Regulations Section1.7704-1 or
Rule 506(b) as promulgated by the Securities and Exchange Commis-
sion pursuant to the Securities Act of 1933, as amended, which-
ever is less. Any attempted transfer or substitution not made in
accordance with this Section 1.05 shall be void. As used herein,
the term "person" shall include natural persons, partnerships,
corporations, trusts and other entities.
Section 1.06 Computations and Calculations. All computations
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and calculations required to be made under the terms of this
Agreement shall be made by the regular accountant of the Partner-
ship. The accountant's determination thereof shall be final,
conclusive and binding upon all of the Partners.
ARTICLE II
Management of Partnership
Section 2.01 Management Generally. The management of the Part-
----------------------------------
nership shall be vested exclusively in the General Partner.
Except as authorized by the General Partner, Limited Partners
shall have no part in the management of the Partnership, and
shall have no authority or right to act on behalf of the Partner-
hip in connection with any matter.
Section 2.02 Authority of the General Partner. The General
---------------------------------------------- Partner shall have
the power on behalf and in the name of the Partnership to carry
out any and all of the objects and purposes of the Partnership
set forth in Section 1.04, and to perform all acts and enter into
and perform all contracts and other undertakings which it may
deem necessary or advisable or incidental thereto, including,
without limitation, the power to:
(a) open, maintain and close accounts, including margin and
custodial accounts, with brokers, which power shall include
the authority to issue all instructions and authorizations
to brokers regarding the Securities and/or money therein,
and to pay, or authorize the payment and reimbursement of,
brokerage commissions;
(b) open, maintain and close accounts, including custodial
accounts, with banks, including banks located outside the
United States, and draw checks or other orders for the
payment of monies;
(c) lend, either with or without security, any Securities, funds
or other properties of the Partnership and borrow or raise
funds and secure the payment of obligations of the Partner-
ship by pledges or hypothecation of all or any part of the
property of the Partnership;
(d) do any and all acts on behalf of the Partnership, and exer-
cise all rights of the Partnership, with respect to its
interest in any person, including, without limitation, the
voting of Securities, participation in arrangements with
creditors, the institution and settlement or compromise of
suits and administrative proceedings and other like or
similar matters;
(e) combine purchase or sale orders on behalf of the Partnership
with orders for other accounts to whom the General Partner
or any of its Affiliates provides investment services
("Other Account") and allocate the securities or other
assets so purchased or sold, on an average price basis,
among such accounts;
(f) enter into arrangements with brokers to open "average price"
accounts wherein orders placed during a trading day are
placed on behalf of the Partnership and Other Accounts and
are allocated among such accounts using an average price;
(g) retain other persons, firms or entities selected by the
General Partner to provide certain management and adminis-
trative services to the Partnership and to cause the Part-
nership to compensate such other persons for such services;
provided, however, that the management, control and conduct
of the activities of the Partnership shall remain the
responsibility of the General Partner;
(h) authorize any partner, director, officer, employee or other
agent of the General Partner or agent or employee of the
Partnership to act for and on behalf of the Partnership;
(i) do any and all acts on behalf of the Partnership, and exer-
cise all rights of the Partnership, with respect to its
interest in any person, firm, corporation or other entity
including, without limitation, participation in arrangements
with creditors, the institution and settlement or compromise
of suits and administrative proceedings and other like or
similar matters; and
(j) do such other acts as the General Partner may deem necessary
or advisable in connection with the maintenance and adminis-
tration of the Partnership in all matters incidental to the
foregoing.
Section 2.03 Reliance by Third Parties. Persons dealing with
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the Partnership are entitled to rely conclusively upon the cer-
tificate of the General Partner to the effect that it is then
acting as the General Partner and upon the power and authority of
the General Partner as herein set forth.
Section 2.04 Activity of the General Partner. The General Part-
---------------------------------------------
ner, Affiliates of the General Partner, and any of its respective
members, officers, directors and employees (collectively,
"Associates"), shall devote so much of their time to the affairs
of the Partnership as in the judgment of the General Partner the
conduct of its business shall reasonably require, and none of the
General Partner, Affiliates or Associates shall be obligated to
do or perform any act or thing in connection with the business of
the Partnership not expressly set forth herein. Nothing herein
contained in this Section 2.04 shall be deemed to preclude the
General Partner, Affiliates or Associates from exercising invest-
ment responsibility, from engaging directly or indirectly in any
other business or from directly or indirectly purchasing,
selling, holding or otherwise dealing with any Securities for the
account of any such other business, for their own accounts, for
any of their family members or for other clients. No Limited
Partner shall, by reason of being a Partner in the Partnership,
have any right to participate in any manner in any profits or
income earned or derived by or accruing to the General Partner or
any Affiliate or Associate from the conduct of any business other
than the business of the Partnership or form any transaction in
Securities effecting by the General Partner or such Affiliate or
Associate for any account other than that of the Partnership.
Section 2.05 Exculpation. None of the General Partner, or its
-------------------------
Affiliates or Associates shall be liable to any Limited Partner
or the Partnership for mistakes of judgment or for action or
inaction which said person reasonably believed to be in the best
interests of the Partnership or for losses due to such mistakes,
action or inaction or to the negligence, dishonesty or bad faith
of any employee, broker or other agent of the Partnership, pro-
vided that such employee, broker or agent was selected, engaged
or retained by the Partnership with reasonable care. Each of the
General Partner, Affiliates and Associates may consult with
counsel and/or accountants in respect of Partnership affairs and
be fully protected and justified in any action or inaction which
is taken in accordance with the advise or opinion of such counsel
and/or accountants, provided that they shall have been selected
with reasonable care.
Notwithstanding any of the foregoing to the contrary, the provi-
sions of this Section 2.05 shall not be construed so as to pro-
vide for the indemnification of the General Partner, or its
Affiliates or Associates for any liability (including liability
under Federal securities laws which, under certain circumstances,
impose liability even on persons that act in good faith), to the
extent (but only to the extent) that such indemnification would
be in violation of applicable law, but shall be construed so as
to effectuate the provisions of this Section 2.05 to the fullest
extent permitted by law.
Section 2.06 Indemnification of General Partner. To the fullest
------------------------------------------------
extent permitted by law, the Partnership shall indemnify and hold
harmless the General Partner, its Affiliates and Associates and
the legal representatives of any of them (an "Indemnified
Party"), from and against any loss or expenses suffered or sus-
tained by an Indemnified Party by reason of the fact that he, she
or it is or was an Indemnified Party, including, without limita-
tion, any judgment, settlement, reasonable attorney's fees and
other costs or expenses incurred in connection with the defense
of any actual or threatened action or proceeding (collectively a
"Claim"), provided that such loss or expense resulted from a mis-
take of judgment on the part of an Indemnified Party, or from
action or inaction that said Indemnified Party reasonably
believed to be in the best interests of the Partnership or for
losses due to the negligence, dishonesty or bad faith of any
employee, broker or other agent of any Indemnified Party provided
that such employee, broker or other agent was selected, engaged
or retained by the Indemnified Party with reasonable care. No
indemnification payment in respect of a Claim asserted in whole
or in part by or on behalf of a Limited Partner who is not an
Affiliate or Associate of the General Partner or the General
Partner's Affiliates or Associates at the time such indemnifica-
tion payment is made shall be debited solely from the Capital
Accounts of such unaffiliated Limited Partner until such time as
the aggregate Capital Accounts (as defined in Section 3.03) of
the Limited Partners unaffiliated with the General Partner or the
General Partner's Affiliates or Associates exceed the aggregate
Capital Accounts of the General Partner and Affiliates and
Associates of the General Partner. The Partnership shall, in the
sole discretion of the General Partner, advance to any Indemni-
fied Party reasonable attorney's fees and other costs and
expenses incurred in connection with the defense of any action or
proceeding that arises out of such conduct. In the event that
such an advance is made by Partnership, the Indemnified Party
shall agree to reimburse the Partnership for such fees, costs and
expenses to the extent that it shall be determined that it was
not entitled to indemnification under this Section 2.06. Not-
withstanding any of the foregoing to the contrary, the provisions
of this Section 2.06 shall not be construed so as to provide for
the indemnification of the General Partner, Affiliate or
Associate for any liability (including liability under Federal
securities laws which, under certain circumstances, impose
liability even on persons that act in good faith), to the extent
(but only to the extent) that such indemnification would be in
violation of applicable law, but shall be construed so as to
effectuate the provisions of this Section 2.06 to the fullest
extent permitted by law.
ARTICLE III
Capital Accounts of Partners
and Operation Thereof
Section 3.01 Definitions. For the purposes of this Agreement,
-------------------------
unless the context otherwise requires:
(a) The term "Accounting Period" shall mean the following
periods: The initial Accounting Period shall commence upon
the initial opening of the Partnership. Each subsequent
Accounting Period shall commence immediately after the close
of the preceding Accounting Period. Each Accounting Period
hereunder shall close at the close of business on the first
to occur of (i) the last day of each Fiscal Quarter of the
Partnership (i.e. March 31, June 30, September 30 and
December 31 of each year), (ii) the effective date of any
withdrawal pursuant to Articles IV or V hereof, or (iii) the
date on which the Partnership dissolves pursuant to Article
VI hereof.
(b) The term "Affiliate" shall mean a person or entity con-
trolled by, controlling or under common control with another
person or entity; "control" shall mean the ownership of more
than 20% (by vote or value) of the outstanding equity
interests in such entity.
Section 3.02 Required Capital Contributions. Each Limited Part-
--------------------------------------------
ner shall make an "Initial Capital Contribution" to the Partner-
ship in an amount not less than $1,000 in cash or assets (subject
to the discretion of the General Partner to accept lesser amounts
and to determine whether to accept any assets and, on a reason-
able basis, the value of any such assets).
The General Partner shall be required to make additional Capital
Contributions to the Partnership from time to time to the extent
necessary to maintain the balance of its Capital Account at an
amount which results in the Partnership being treated as a
partnership for Federal income tax purposes.
Section 3.03 Capital Accounts. A capital account (each a "Capi-
------------------------------
tal Account") shall be established on the books of the Partner-
ship for each Partner. The Capital Account of each Partner shall
be in an amount equal to such Partner's aggregate Capital Con-
tributions, adjusted as hereinafter provided. The Capital
Account of each Partner shall be (i) increased or decreased by
such Partner's pro rata, based on its Partnership Percentage,
amount of any item of income, gain, profit, expense, loss, credit
or other similar item recognized, accrued, or otherwise incurred
by or attributed to the Partnership consistent with the terms of
this Agreement and (ii) decreased by the amount of any with-
drawals made by such Partner pursuant to Article IV or any dis-
tributions made to such Partner pursuant to Article IV.
Section 3.04 Partnership Percentages. A Partnership Percentage
-------------------------------------
shall be determined at any given time for each Partner of the
Partnership by dividing the amount of each Partner's Capital
Account by the aggregate amount of the Capital Accounts of all
Partners. The sum of the Partnership Percentages shall equal 100
per cent.
Section 3.05 Liabilities. Liabilities shall be determined in
-------------------------
accordance with generally accepted accounting principles, applied
on a consistent basis; provided, however, that the General Part-
ner in its discretion may provide reserves for estimated accrued
expenses, liabilities or contingencies, including general
reserves for unspecified contingencies not in accordance with
generally accepted accounting principles.
Section 3.06 Allocation for Tax Purposes. For each fiscal year
-----------------------------------------
items of income, deduction, gain, loss or credit shall be allo-
cated for income tax purposes among the Partners in such manner
as to reflect equitably amounts credited or debited to each
Partner's Capital Account for the current and prior Fiscal Years
(or relevant portions thereof). Allocations under this Section
3.06 shall be made pursuant to the principles of Section 704(b)
and 704(c) of the Internal Revenue Code of 1986, as amended (the
"Code"), and in conformity with Regulations Sections 1.704-
(b)(2)(iv)(f) and 1.704-1(b)(4)(i) and 1.704-3(e) promulgated
thereunder, as applicable, or the successor provisions to such
Section and Regulations. Notwithstanding anything to the
contrary in this Agreement, there shall be allocated to the
Partners such gains or income as shall be necessary to satisfy
the "qualified income offset" requirement of Regulations Section
1.704-1(b)(2)(ii)(d).
Section 3.07 Determination by General Partner of Certain Mat-
-------------------------------------------------------------
ters. All matters concerning the allocation of income, expenses,
----
profits, gains and losses among the Partners, including taxes
thereon, and accounting procedures not expressly provided for by
the terms of this Agreement shall be determined by the General
Partner, whose determination shall be final and conclusive as to
all of the Partners.
Section 3.08 Adjustment to Take Account of Interim Year Events.
---------------------------------------------------------------
If the Code or regulations promulgated thereunder require a with-
holding or other adjustment to the Capital Account of a Partner
or some other interim year event occurs necessitating in the
General Partner's judgment an equitable adjustment, the General
Partner shall make such adjustments in the determination and
allocation among the Partners of Capital Accounts, Partnership
Percentages, items of income, deduction, gain, loss, credit or
withholding for tax purposes, accounting procedures or such other
financial or tax items as shall equitably take into account such
interim year event and applicable provisions of law, and the
determination thereof by the General Partner shall be final and
conclusive as to all of the Partners.
ARTICLE IV
Withdrawals and Distributions of Capital
Section 4.01 Withdrawals and Distributions in General. No Part-
------------------------------------------------------
ner shall be entitled (i) to receive distributions from the Part-
nership, except as provided herein and in Section 6.02, or (ii)
to withdraw any amount from such Partner's Capital Account,
except as provided herein or upon the consent of, and upon such
terms as may be determined by, the General Partner in his reason-
able discretion.
Section 4.02 Distribution.
--------------------------
(a) The General Partner may, at any time and in his discretion,
make distributions in cash or Securities to any or all of
the Partners. Each such distribution shall reduce the Capi-
tal Account to the distributee Partner by the value of such
distribution.
(b) The General Partner may withhold taxes from any distribution
to any Partner to the extent required by the Code or any
other applicable law. For purposes of this Agreement, any
taxes so withheld by the Partnership with respect to any
amount distributed by the Partnership to any Partner shall
be deemed to be a distribution or payment to such Partner,
reducing the amount otherwise distributable to such Partner
pursuant to this Agreement and reducing the Capital Account
of such Partner.
Section 4.03 Withdrawals.
-------------------------
(a) The General Partner may, at any time and from time to time
in his sole discretion, permit a Partner to elect to with-
draw, in whole or in part, from the Partnership in
accordance with this Section 4.03.
(b) The following definitions shall apply for purposes of this
Section 4.03:
(i) "Book Value of the Withdrawal Interest" shall be
determined, as of the Withdrawal Date, (x) by sub-
tracting the total liabilities of the Partnership
from the total assets of the Partnership and (y) by
dividing the amount so determined by the Withdrawal
Interest.
(ii) "Distribution Date" shall mean any date, not less
than five (5) nor more than thirty (30) days fol-
lowing the Withdrawal Date, on which the Partnership
shall make a Withdrawal Distribution.
(iii) "Withdrawal Date" shall mean any date determined by
the General Partner in his sole discretion, at any
time and from time to time.
(iv) "Withdrawal Distribution" shall mean the Book Value
of the Withdrawal Interest, excluding an amount con-
sistent with the Withdrawal Partner's pro rata por-
tion of the Partnership's expenses and liabilities
in accordance with Section 4.03(c)(v), rounded to
the nearest hundredth.
(v) "Withdrawal Documents" shall mean any documents the
execution of which the General Partner reasonably
determines is necessary or appropriate in connection
with the withdrawal of a Withdrawing Partner.
(vi) "Withdrawal Request" shall mean a written request,
given by a Partner to the General Partner not less
than five (5) days prior to any Withdrawal Date
determined by the General Partner, indicating such
Partner's election to receive a Withdrawal Distribu-
tion in exchange for the Withdrawing Interest speci-
fied in such notice.
(vii) "Withdrawal Interest" shall mean a percentage
interest of a Withdrawing Partner in the Partnership
to be exchanged for a Withdrawal Distribution as
specified in a Withdrawal Notice.
(viii) "Withdrawal Partner" shall mean any Partner electing
to withdraw from the Partnership in accordance with
this Section 4.03 to the extent of such Partner's
Withdrawing Interest. A Partner shall not be a
Withdrawing Partner to the extent of such Partner's
interest in the Partnership other than his With-
drawing Interest.
(c) (i) The Withdrawing Partner shall cease to be a Partner
in the Partnership as of the close of business on
the Withdrawal Date and, except as otherwise pro-
vided in this Agreement, neither the Partnership nor
the Withdrawing Partner shall have any further
liability or obligation to the other.
(ii) Within thirty (30) days following a Withdrawal Date,
the General Partner shall notify the Withdrawing
Partner of (a) the amount of the Withdrawal Distri-
bution, and (b) the Distribution Date, and shall
deliver with such notice execution copies of any
Withdrawal Documents.
(iii) On the Distribution Date, (a) the General Partner
and the Withdrawing Partner shall execute any With-
drawal Documents, and (b) the General Partner shall
cause the Partnership to transfer to the Withdrawal
Partner such Withdrawal Partner's Withdrawal Distri-
bution in the form of cash or Securities, or a com-
bination of both, subject to the discretion of the
General Partner.
(iv) Notwithstanding anything else in the Agreement to
the contrary, the books and records of the Partner-
ship shall be amended by the General Partner, effec-
tive as of the day following any Withdrawal Date, to
remove the Withdrawal Interest therefrom and to in-
crease proportionally the percentage interests of
the remaining Partners in the Partnership (including
the Withdrawing Partner to the extent of such Part-
ner's percentage interest in the Partnership, if
any, other than such Partner's Withdrawing
Interest).
(d) Limitations on Withdrawal of Capital Account. The right of
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any Withdrawal Partner or such Withdrawal Partner's legal
representatives to have distributed the Capital Account of
such Partner pursuant to this Article IV is subject to the
provision by the General Partner for all Partnership
liabilities in accordance with the Act and for reserves for
contingencies and estimated accrued expenses all in
accordance with Article III hereof.
ARTICLE V
Withdrawal, Death and Disability
Section 5.01 Withdrawal, Death, etc. of Limited Partners.
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(a) The withdrawal, death, disability, incapacity, adjudication
of incompetency, termination, bankruptcy, insolvency or dis-
solution of a Limited Partner shall not dissolve the Part-
nership. The legal representatives of a Limited Partner
shall succeed as assignee to the Limited Partner's interest
in the Partnership upon the death, disability, incapacity,
incompetency, termination, bankruptcy, insolvency or disso-
lution of such Limited Partner, but shall not be admitted as
a substituted partner without the consent of the General
Partner.
Section 5.02 Required Withdrawals.
----------------------------------
The General Partner has the right upon not less than ten (10)
days' prior written notice, to require a Limited Partner to
withdraw all or any portion of his Capital Account from the
Partnership, if the General Partner determines or has reason to
believe that:
(i) such Limited Partner has transferred or attempted to
transfer any portion of his interest in the Partner-
ship in violation of the Partnership Agreement;
(ii) ownership of an interest in the Partnership by such
Limited Partner will cause the Partnership to be in
violation of, or require registration of any
interest in the Partnership under, or subject the
Partnership or the General Partner to additional
regulation under the securities or commodities laws
of the United States or any other relevant jurisdic-
tion or the rules of any self-regulatory organiza-
tion applicable to the Partnership or the General
Partner;
(iii) continued ownership of an interest in the Partner-
ship by such Limited Partner may be harmful or
injurious to the business or reputation of the
Partnership or the General Partner, or may subject
the Partnership or any of the partners to an undue
risk of adverse tax or other fiscal consequences,
including without limitation, adverse consequences
under the Employee Retirement Income Security Act of
1974, as amended or failure to qualify for the
"private placement" safe harbor from publicly traded
partnership status;
(iv) the General Partner determines that such Limited
Partner's continued participation in the Partnership
would cause the Partnership to fail to qualify for
the safe harbor from publicly traded partnership
status set forth in Treasury Regulation Section
1.7704-1(h);
(v) any of the representations and warranties made by
such Limited Partner in connection with the acquisi-
tion of his interest in the Partnership was not true
when made or has ceased to be true;
(vi) such Limited Partner's interest in the Partnership
has vested in another person by reason of the bank-
ruptcy, dissolution, incompetency or death of such
Limited Partner; or
(vii) the General Partner determines in his absolute dis-
cretion that such Limited Partner's interest in the
Partnership should be withdrawn.
The Limited Partner receiving such notice shall be treated for
all purposes and all respects as a Withdrawal Partner under
Section 4.03.
ARTICLE VI
Duration and Dissolution of Partnership
Section 6.01 Duration. The Partnership shall continue until the
----------------------
earlier of (i) the death, disability, adjudicated incompetency or
bankruptcy of the General Partner or (ii) such time as the
General Partner, in its sole discretion, decides to dissolve the
Partnership, it being understood that it is the intent of the
General Partner and the purpose of the Partnership for the Part-
nership to be dissolved when substantially all of the Securities
have been sold and/or distributed to the Partners, and all
expenses and liabilities have either been paid or otherwise pro-
vided for by means of the establishment of a reserve.
Section 6.02 Dissolution.
-------------------------
(a) On dissolution of the Partnership, the Partners shall, with-
in no more than thirty (30) days after completion of the
Partnership's financial statements (which shall be performed
within ninety (90) days of such termination), make distribu-
tions out of Partnership assets, in the following manner and
order:
(i) to creditors, to the extent otherwise permitted by
law, in satisfaction of liabilities of the Partner-
ship (whether by payment or by establishment of
reserves);
(ii) to Partners who are creditors; and
(iii) to the Partners in the proportion of their respective
Capital Accounts.
(b) The General Partner, in its discretion, at any time and from
time to time, may designate one or more liquidators,
including, without limitation, one or more members of the
General Partner, who shall have full authority to wind up
and liquidate the business of the Partnership and to make
final distributions as provided in this Section 6.02. The
appointment of any liquidator may be revoked or a successor
or additional liquidator or liquidators may be appointed at
any time by an instrument in writing signed by the General
Partner. Any such liquidator may receive compensation as
shall be fixed, from time to time, by the General Partner.
(c) For purposes of distributing the assets of the Partnership
upon dissolution, the General Partner shall be entitled to a
return, on a pari passu basis with the Limited Partners, of
the amount standing to his credit in his Capital Account
and, with respect to his share of profits, based upon his
Partnership Percentage.
ARTICLE VII
Tax Returns; Reports to Partners
Section 7.01 Filing of Tax Returns. The General Partner shall
-----------------------------------
prepare and file, or cause the accountant of the Partnership to
prepare and file, a Federal information tax return in compliance
with Section 6031 of the Code, and any required state and local
income tax and information returns for each tax year of the Part-
nership.
Section 7.02 Tax Matters Partner. The General Partner shall be
---------------------------------
designated on the Partnership's annual Federal information tax
return, and have full powers and responsibilities, as the Tax
Matters Partner of the Partnership for purposes of Section
6231(a)(7) of the Code. Each person (for purposes of this Sec-
tion 7.02, called a "Pass-Thru Partner") that holds or controls
an interest as a Limited Partner on behalf of, or for the benefit
of, another person or persons, or which Pass-Thru Partner is
beneficially owned (directly or indirectly) by another person or
persons shall, within thirty (30) days following receipt from the
Tax Matters Partner of any notice, demand, request for informa-
tion or similar document, convey such notice or other document in
writing to all holders of beneficial interest in the Partnership
holding such interests through such Pass-Thru Partner. In the
event the Partnership shall be the subject of an income tax audit
by any Federal, state or local authority, to the extent the Part-
nership is treated as an entity for purposes of such audit,
including administrative settlement and judicial review, the Tax
Matters Partner shall be authorized to act for, and its decision
shall be final and binding upon, the Partnership and each Partner
thereof. All expenses incurred in connection with any such
audit, investigation, settlement or review shall be borne by the
Partnership.
Section 7.03 Reports to Current Partners. Within ninety (90)
-----------------------------------------
days after the end of each Fiscal Year or as soon thereafter as
is reasonably possible, the Partnership shall prepare and mail to
each Partner financial reports setting forth as of the end of
such Fiscal Year:
(a) a balance sheet of the Partnership;
(b) a statement of income and expenses for such year;
(c) such Partner's Capital Account as of the end of such year;
and
(d) such Partner's Capital Account and Partnership Percentage
for the then current Accounting Period.
Upon request, the Partnership will provide to tax-exempt Limited
Partners accounting information required by such entities to
report for income tax purposes their "unrelated business taxable
income," but in such event would assess the cost of providing
such information directly to such Limited Partners.
Section 7.04 Reports to Partners and Former Partners. Within
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ninety (90) days of the end of each Fiscal Year or as soon there-
after as is reasonably possible, the Partnership shall prepare
and mail, or cause its accountant to prepare and mail, to each
Partner and, to the extent necessary, to each former Partner (or
such Partner's legal representatives), a report setting forth in
sufficient detail such information as shall enable such Partner
or former Partner (or such Partner's legal representatives) to
prepare its respective Federal income tax returns in accordance
with the laws, rules and regulations then prevailing.
ARTICLE VIII
Miscellaneous
Section 8.01 General. This Agreement: (i) shall be binding on
---------------------
the executors, administrators, estates, heirs, and legal succes-
sors and representatives of the Partners; and (ii) may be
executed, through the use of separate signature pages or supple-
mental agreements in any number of counterparts with the same
effect as if the parties executing such counterparts had all exe-
cuted one counterpart; provided, however, that each such counter-
part shall have been executed by the General Partner and that the
counterparts, in the aggregate, shall have been signed by all of
the Partners.
Section 8.02 Power of Attorney. Each of the Partners hereby
-------------------------------
appoints the General Partner as its true and lawful representa-
tive and attorney-in-fact, in its name, place and stead to make,
execute, sign, acknowledge, swear to and file:
(a) a Certificate of Limited Partnership of the Partnership and
any amendments thereto as may be required under the Act;
(b) any duly adopted amendment to this Agreement;
(c) any and all instruments, certificates, and other documents
that may be deemed necessary or desirable to effect the
dissolution and winding-up of the Partnership (including,
but not limited to, a Certificate of Cancellation of the
Certificate of Limited Partnership); and
(d) any business certificate, fictitious name certificate,
amendment thereto, or other instrument or document of any
kind necessary or desirable to accomplish the business,
purpose and objectives of the Partnership, or required by
any applicable Federal, state or local law.
The power of attorney hereby granted by each of the Limited Part-
ners is coupled with an interest, is irrevocable, and shall sur-
vive, and shall not be affected by, the subsequent death,
disability, incapacity, incompetency, termination, bankruptcy,
insolvency or dissolution of such Limited Partner; provided, how-
ever, that such power of attorney will terminate upon the substi-
tution of another limited partner for all of such Limited
Partner's interest in the Partnership or upon the complete with-
drawal of such Limited Partner from participation in the Partner-
ship.
Section 8.03 Amendments to Partnership Agreement. The terms and
-------------------------------------------------
provisions of this Agreement may be modified or amended at any
time and from time to time upon the written consent of the Part-
ners, insofar as is consistent with the laws governing this
Agreement; provided, however, that without the consent of the
Limited Partners, the General Partner may amend the Agreement to
(i) reflect changes validly made in the membership of the Part-
nership and the Capital Contributions and Partnership Percentages
of the Partners; (ii) reflect a change in the name of the Part-
nership; (iii) make a change that is necessary or, in the sole
discretion of the General Partner, advisable to qualify the Part-
nership as a limited partnership or a partnership in which the
Limited Partners have limited liability under the laws of any
state or foreign jurisdiction, or ensure that the Partnership
will not be treated as an association or a publicly traded part-
nership taxable as a corporation for Federal income taxes pur-
poses; (iv) make a change that does not adversely affect the
Limited Partners in any material respect; (v) make a change that
is necessary or, in the sole discretion of the General Partner,
desirable to cure any ambiguity, to correct or supplement any
provision in this Agreement that would be inconsistent with any
other provision in this Agreement, or to make any other provision
with respect to matters or questions arising under this Agreement
that will not be inconsistent with the provisions of this Agree-
ment, in each case so long as such change does not adversely
affect the Limited Partners in any material respect; (vi) make a
change that is necessary or, in the sole discretion of the
General Partner, desirable to satisfy any requirements, condi-
tions or guidelines contained in any opinion, directive, order,
statute, ruling or regulation of any Federal, state or foreign
governmental entity, so long as such change is made in a manner
which minimizes any adverse effect on the Limited Partners; (vii)
make a change that is required or contemplated by this Agreement;
(viii) make a change in any provision of this Agreement that
requires any action to be taken by or on behalf of the General
Partner or the Partnership pursuant to applicable Delaware law if
the provisions of applicable Delaware law are amended, modified
or revoked so that the taking of such action is no longer
required; (ix) prevent the Partnership from in any manner being
deemed an "Investment Company" subject to the provisions of the
Investment Company Act of 1940, as amended; or (x) make any other
amendments similar to the foregoing. Each Partner, however, must
approve of any amended which would (a) reduce such Partner's
Capital Account or rights of contribution or withdrawal; or (b)
amend the provisions of this Agreement relating to amendments.
Section 8.04 Choice of Law. Notwithstanding the place where
---------------------------
this Agreement may be executed by any of the parties thereto, the
parties expressly agree that all the terms and provisions hereof
shall construed under the laws of the State of Delaware
(excepting those conflicts of law provisions which would serve to
defeat Delaware substantive law) and, without limitation thereof,
that the Act as now adopted or as may be hereafter amended shall
govern the partnership aspects of this Agreement.
Section 8.05 Adjustment of Basis of Partnership Property. In
---------------------------------------------------------
the event of a distribution of Partnership property to a Partner
or an assignment or other transfer (including by reason of death)
of all or part of the interest of a Limited Partner in the Part-
nership, at the request of a Partner, the General Partner, in his
discretion, may cause the Partnership to elect, pursuant to Sec-
tion 754 of the Code, or the corresponding provision of subse-
quent law, to adjust the basis of the Partnership property as
provided by Sections 734 and 743 of the Code.
Section 8.06 Notices. Each notice relating to this Agreement
---------------------
shall be in writing and delivered in person or by registered or
certified mail. All notices to the Partnership shall be
addressed to its principal office and place of business. All
notices addressed to a Partner shall be addressed to such Partner
at the address designated by such Partner below. Unless other-
wise specifically provided in this Agreement, a notice shall be
deemed to have been effectively given when mailed by registered
or certified mail to the proper address or delivered in person.
Section 8.07 Goodwill. No value shall be placed on the name or
----------------------
goodwill of the Partnership, which shall belong exclusively to
the General Partner.
Section 8.08 Headings. The titles of the Articles and the
----------------------
headings of the Sections of this Agreement are for convenience of
referenced only, and are not to be considered in construing the
terms and provisions of this Agreement.
Section 8.09 Pronouns. All pronouns shall be deemed to refer to
----------------------
the masculine, feminine, neuter, singular or plural, as the
identity of the person or persons, firm or corporation may
require in the context thereof.
[SIGNATURES ON FOLLOWING PAGE]
IN WITNESS WHEREOF, the undersigned have hereunto set their hands
as of the date first set forth above.
GENERAL PARTNER: LIMITED PARTNER:
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Address: Address:
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