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Exhibit 10.6
PIONEER POLAND U.S., L.P.
AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
Effective December 14, 1994, the Agreement of Limited Partnership among
Pioneer Poland U.S. (Jersey) Limited (hereinafter referred to as the "General
Partner"), and Pioneer Poland U.K. (Jersey) Limited, the initial limited
partner, pursuant to which Pioneer Poland U.S., L.P., a Delaware limited
partnership (the "Partnership"), was organized and established, is hereby
amended by (i) effecting the withdrawal from the Partnership of Pioneer Poland
U.K. (Jersey) Limited in its capacity as initial limited partner, (ii) admitting
to the Partnership those persons named on Schedule A hereto as limited partners
(hereinafter referred to collectively as the "Limited Partners" and individually
as a "Limited Partner"), and (iii) amending and restating the various provisions
thereof so that said Agreement, as amended and restated, reads in its entirety
as follows:
1. GENERAL PROVISIONS
1.01 Name of the Partnership.
The name of the Partnership shall be Pioneer Poland U.S., L.P., or such
other name as the General Partner may from time to time determine. The
General Partner shall cause to be filed on behalf of the Partnership such
partnership or assumed or fictitious name certificate or certificates as
may from time to time be required by law. The General Partner shall notify
each Limited Partner of any change in the name of the Partnership.
1.02 Formation and Continuation.
The Partnership was formed under the Delaware Revised Uniform Limited
Partnership Act (the "Delaware Act") and shall be continued as a Delaware
limited partnership in accordance with the Delaware Act.
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1.03 Business of the Partnership; Investment Objective and Policies.
(a) The Partnership is one of a series of Partnerships which have been
organized under English law or the laws of Delaware, United States,
or may in the future be organized under English law or under the
laws of any other jurisdiction to invest in securities of issuers
doing business primarily in Poland, as set forth in a Confidential
Private Placement Memorandum dated March 21, 1994 as it has been and
as it may be supplemented from time to time (the "Memorandum"), and
which are being jointly managed pursuant to a Joint Management
Agreement (the "Joint Management Agreement") of even date herewith
by Pioneering Management (Jersey) Limited, as manager (the
"Manager") (as so jointly managed, the Partnership and such other
partnerships are hereafter collectively referred to as the "Fund",
and the other partnerships comprising the Fund are hereinafter
referred to as the "Other Fund Entities"). It is the intention of
the Partners that the investment portfolio of the Partnership be
identical (as a percentage of net asset value) with the investment
portfolios of the Other Fund Entities. Notwithstanding the
foregoing, the relationship created among the Partnership and the
Other Fund Entities by the Joint Management Agreement is one of
contract only, and not of a partnership or joint venture, and does
not create an entity of any kind, and neither the Partnership nor
any Other Fund Entity shall have the right to bind or act for the
other in any way whatsoever. Further, notwithstanding that the
Partnership and the Other Fund Entities are separate and distinct
entities and that the rights and obligations of the Partners are
governed by the terms of this Agreement and the Delaware Act, the
Partners have agreed that certain matters relating to the investment
decisions of the Manager pursuant to the Joint Management Agreement
shall be subject to the approval of specified percentages of the
Partners and the partners of the Other Fund Entities on an aggregate
basis as specified in Article 4 hereof.
Subject to the foregoing, the business of the Partnership (the
"Investment Objective") shall principally be to buy, sell, hold and
otherwise invest in and deal with unlisted equity and equity related
securities primarily of non-state-owned
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companies whose principal operations, headquarters, assets, sources
of revenue or profits are in the Republic of Poland or which, in the
judgment of Pioneer Investment Poland, as advisor for the
Partnership (the "Advisor"), may benefit significantly from their
commercial activities in Poland, and to engage in any other
activities incident to or related to any of the foregoing.
The investment policies of the Partnership (the "Investment
Policies") are as follows:
(i) The Partnership will invest only in equity and equity related
securities of issuers which are incorporated in or which have
their principal operations in Poland (which are not more than
49% directly or indirectly owned by a government), or those
issuers meeting the criteria set forth in paragraph (iii)
below, or Polish public sector enterprises which are
participating in the Polish Government's privatisation
program, including the Mass Privatisation Program, or
implementing a program to achieve private ownership and
control, or which will be privatised as a result of the
investment by the Partnership (collectively, "Polish
Issuers");
(ii) Investments will be used to acquire interests in portfolio
companies, to finance and implement restructuring programs or
to finance specific projects or investment programs for the
creation, modernization or working capital requirements of
portfolio companies;
(iii) All portfolio companies must be based in Poland, or in another
member country of the European Bank for Reconstruction and
Development (the "EBRD") in which case the business objectives
(but not necessarily all business relations) of such companies
must be exclusively restricted to investments in Poland;
(iv) The Partnership will not invest in enterprises whose primary
business is (x) arms manufacturing or other military-related
activities, (y) manufacture of tobacco products or hard
spirits, or (z) operation of casinos or other gambling
facilities;
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(v) The Partnership will not be involved in hostile bids;
(vi) Pending investment in portfolio companies or distribution of
proceeds to Partners, the Partnership may hold cash and
investment grade money market instruments denominated in
currencies free from internal or external mandatory conversion
requirements or in financial instruments of the EBRD or in
obligations backed by the full faith and credit of the United
States of America or of Poland; and
(vii) the Partnership will invest only in enterprises whose legal
form of organization is designed to limit the liability of
investors to the amount of capital invested; however, each
Partner acknowledges that, under certain circumstances, the
Partnership could be liable for an amount greater than the
amount invested, because under Polish law, an investor in a
"limited liability company" is potentially liable for unpaid
taxes of the company in a proportion equal to such investor's
share in profits of the company.
(b) In addition to any consents which may be required pursuant to
Section 4.02 hereof, the Partnership shall not, without the consent
of (i) the EBRD so long as the EBRD owns any Interest in the
Partnership or any Other Fund Entities (ii) DEG - Deutsche
Investitions- und Entwicklungsgesellschaft mbH ("DEG") so long as
DEG continues to own at least the lesser of (A) ten percent (10%) of
the aggregate number of Interests in the Partnership and the Other
Fund Entities or (B) 11.3 Interests, and (iii) Lyndhurst Associates,
Carnegie Mellon University and Xxxxx Xxxxxxxx (collectively, the
"Pittsburgh Group") so long as the Pittsburgh Group continues to own
at least 10.5 Interests (and the consent of the representative of
the Pittsburgh Group (the "Pittsburgh Representative") on the
Oversight Board (as defined in the Joint Management Agreement) shall
constitute the consent of the Pittsburgh Group required hereby):
(w) modify the Investment Objective, or any of the
Investment Policies or Investment Restrictions;
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(x) make any investments other than in accordance with the
Environmental Procedures attached hereto as Exhibit A,
and no investments may be made in companies which are
engaged in activities listed on the Environmental
Exclusion List attached hereto as Exhibit B (provided
that in the event the EBRD no longer owns any Interest
in the Partnership or any Other Fund Entities, such
Environmental Procedures may be modified by a majority
of the members of the Oversight Board);
(y) amend any of the Fund Documents (as defined below),
except amendments which, in the reasonable judgment of
the Manager, (A) are required by law, (B) are
administrative in nature, or (C) are required for tax
reasons; or
(z) upon becoming aware of any material environmental issue
which arises in connection with any investment, fail to
notify the EBRD, DEG or the Pittsburgh Representative,
as the case may be, of such issue and provide such
person with such reasonable information as it may
request concerning any such issue.
(c) The Partnership will annually prepare and make available to each
Limited Partner an environmental report on the implementation of the
Environmental Procedures, which shall, in particular, provide
information on the following:
(i) the integration of the Environmental Procedures into the
investment process;
(ii) the use of local environmental consultants in the
implementation of the Environmental Procedures;
(iii) the on-going monitoring of the environmental aspects of
investments;
(iv) the screening processes applied to the environmental risks and
liabilities of investments;
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(v) adverse publicity or comment, if any, including complaints
made to the Partnership concerning the environmental aspects
of particular investments, together with a description of how
these issues have been addressed; and
(vi) a report on problems or difficulties encountered in carrying
out the Environmental Procedures;
provided, that the Partnership shall not be required to prepare or
make available such report at any time that the EBRD does not own
any Interest in the Partnership or any Other Fund Entities.
1.04 Place of Business of the Partnership.
The principal place of business of the Partnership shall be located at La
Xxxxx Xxxxxxxx, Xx. Xxxxxx, Xxxxxx, Xxxxxxx Xxxxxxx XX0 0XX. The General
Partner may, at any time and from time to time, change the location of the
Partnership's principal place of business, upon written notice of such
change to the Limited Partners and the appropriate regulatory authorities
in Delaware and Jersey, Channel Islands, and may establish such additional
place or places of business of the Partnership as they may from time to
time determine.
1.05 Duration of the Partnership.
The Partnership commenced upon the filing on December 14, 1994 of a
Certificate of Limited Partnership for the Partnership in accordance with
the Delaware Act, and shall continue until terminated in accordance with
Section 7 hereof.
1.06 Partners' Names and Addresses.
The names and addresses of the Partners are set forth on Schedule A
hereto. The General Partner and the Limited Partners are sometimes
collectively referred to herein as the "Partners" and individually as a
"Partner."
1.07 Title to Partnership Property.
All property owned by the Partnership, whether real or personal, tangible
or intangible, shall be deemed to be owned by the Partnership as an
entity, and no Partner, individually, shall have any ownership of such
property.
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The Partnership may hold any of its assets in its own name or in the name
of its nominee, which nominee may be one or more corporations,
partnerships, trusts or other entities.
1.08 Resident Agent.
The Partnership's agent for service of process in Delaware shall be
Corporation Trust Company, Corporation Trust Center, 0000 Xxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000 or such other agent as the General Partner may
from time to time appoint.
1.09 Certificate of Limited Partnership.
Except as otherwise provided herein, the General Partner shall not be
obliged to deliver or mail copies of the Partnership's Certificate of
Limited Partnership or any certificate of amendment thereto or
cancellation thereof to the Limited Partners. Such documents will be
available for inspection at the offices of the Partnership as described in
Section 1.04 hereof.
1.10 Representation and Warranties of the General Partner.
The General Partner represents, warrants and covenants to each Limited
Partner that:
(a) All action required to be taken by the General Partner and the
Partnership as a condition to the issuance and sale of the Interests
being purchased by the Limited Partners has been taken; the Interest
in the Partnership of each Limited Partner represents a duly and
validly issued interest in the Partnership and, subject to the
registration of the Partnership pursuant to, and in compliance with,
the Delaware Act, each Limited Partner of the Partnership is
entitled to all the benefits of a Limited Partner under this
Agreement and all the benefits of a "limited partner" under the
Delaware Act;
(b) This Agreement has been duly authorized, executed and delivered by
the General Partner and constitutes the valid and legally binding
agreement of the General Partner;
(c) Except for those which have been obtained prior to the date hereof,
no consent, approval or authorization of, or filing, registration or
qualification with, any court or governmental
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authority on the part of the General Partner or the Partnership is
required for the execution and delivery of this Agreement by the
General Partner, the performance of its or the Partnership's
obligations and duties hereunder, or the issuance of Interests in
the Partnership as contemplated hereby, except any thereof which may
be required of the Partnership solely by virtue of the nature of any
Limited Partner;
(d) The General Partner is not in default (nor has any event occurred
which with notice, lapse of time, or both, would constitute a
default) in the performance of any obligation, agreement or
condition contained in this Agreement, nor, to the best of its
knowledge, is it in violation of any statute, regulation, law,
order, writ, injunction, judgment or decree to which it is subject,
which default or violation would materially adversely affect the
business or financial condition of the General Partner or the
Partnership or impair the General Partner's ability to carry out its
obligations under this Agreement;
(e) There is no litigation, investigation or other proceeding pending
or, to the knowledge of the General Partner, threatened against the
General Partner or the Partnership and to the knowledge of the
General Partner, there is no litigation, investigation or other
proceeding pending or threatened against its affiliates, which is
reasonably expected to have a material adverse effect on the
business or financial condition of the General Partner or the
Partnership.
2. CAPITAL CONTRIBUTIONS, PROFITS AND LOSSES
2.01 Capital Contributions.
(a) The Partnership has, effective on the date hereof, admitted as
Limited Partners those subscribers listed on Schedule A hereto, for
the number of units set forth opposite their names on Schedule A. In
addition, the General Partner has, effective on the date hereof,
subscribed for the number of units set forth opposite its name on
Schedule A. Each unit subscribed for by a Partner is hereinafter
referred to as an "Interest", and the product of the purchase price
per Interest and the number of Interests being
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subscribed for by a Partner is referred to as the Partner's
"Subscribed Capital". Each of the Partners has contributed to the
capital of the Partnership on the date hereof an amount equal to 25%
of the Partner's Subscribed Capital (the "First Installment of
Subscribed Capital"). Each of the Limited Partners (other than the
EBRD) hereby grants to the Partnership a security interest in the
Interests being subscribed for as security for its obligation to
contribute the remaining balance of the Subscribed Capital pursuant
to the terms hereof.
(b) Not more than 30 days after the delivery by the General Partner to
the Limited Partners of notice from the General Partner (the "Second
Installment Notice") to the effect that (i) at least 80% of the
collected First Installment of Subscribed Capital of all Partners
has been committed to investments in Polish Issuers, and (ii) 100%
of any Total Drawndown Capital which had been returned to the
Partnership following the disposition of an investment in Polish
Issuers has been reinvested or committed to investments in Polish
Issuers or distributed or otherwise paid to the Partners or their
affiliates, each of the Partners shall contribute an additional
amount (the "Second Installment of Subscribed Capital") equal to
twenty-five percent (25%) of that Partner's Subscribed Capital to
the capital of the Partnership; provided, however, that no such
Second Installment of Subscribed Capital shall be payable if the
Second Installment Notice shall not have been delivered to the
Limited Partners prior to the third anniversary of the date hereof
(the "Commitment Termination Date").
Not more than 30 days after the delivery by the General Partner to
the Limited Partners of notice from the General Partner (the "Third
Installment Notice") to the effect that (i) at least 80% of the
collected First Installment of Subscribed Capital and the collected
Second Installment of Subscribed Capital of all Partners have been
committed to investments in Polish Issuers, and (ii) 100% of any
Total Drawndown Capital which had been returned to the Partnership
following the disposition of an investment in Polish Issuers has
been reinvested or committed to investments in Polish issuers or
distributed or otherwise paid to the Partners or their affiliates,
each of the Partners shall
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contribute an additional amount (the "Third Installment of
Subscribed Capital") equal to twenty-five percent (25%) of that
Partner's Subscribed Capital to the capital of the Partnership;
provided, however, that no such Third Installment of Subscribed
Capital shall be payable if the Third Installment Notice shall not
have been delivered to the Limited Partners prior to the Commitment
Termination Date.
Not more than 30 days after the delivery by the General Partner to
the Limited Partners of notice from the General Partner (the "Fourth
Installment Notice") to the effect that (i) at least 80% of the
collected First Installment of Subscribed Capital, the collected
Second Installment of Subscribed Capital and the collected Third
Installment of Subscribed Capital of all Partners have been
committed to investments in Polish Issuers, and (ii) 100% of any
Total Drawndown Capital which had been returned to the Partnership
following the disposition of an investment in Polish Issuers has
been reinvested or committed to investments in Polish Issuers or
distributed or otherwise paid to the Partners or their affiliates,
each of the Partners shall contribute an additional amount (the
"Fourth Installment of Subscribed Capital") equal to twenty-five per
cent (25%) of that Partner's Subscribed Capital (being the balance
of that Partner's Subscribed Capital) to the capital of the
Partnership; provided, however, that no such Fourth Installment of
Subscribed Capital shall be payable if the Fourth Installment Notice
shall not have been delivered to the Limited Partners prior to the
Commitment Termination Date. For purposes of this Section 2.01, the
total amount, at any time, of Subscribed Capital actually
contributed by a Partner to the Partnership shall be that Partner's
"Drawndown Capital," and the aggregate Drawndown Capital of all of
the Partners shall be the "Total Drawndown Capital" of the
Partnership.
(c) If any Limited Partner fails to contribute the Second Installment of
Subscribed Capital, the Third Installment of Subscribed Capital or
the Fourth Installment of Subscribed Capital on or before the date
when such amount is due and payable, such Limited Partner (a
"Defaulting Partner") shall be deemed to be in default hereunder,
and the General Partner shall have all rights and remedies, on
behalf
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of the Partnership, available at law or in equity to collect such
amount from the Defaulting Partner. In addition, the General Partner
shall have the option, exercisable as hereinafter provided, (i) to
initiate the bid process described in Section 2.01(d), or (ii) to
terminate the obligation of the Defaulting Partner to make further
installments of Subscribed Capital and to cancel such Defaulting
Partner's Interests. Notwithstanding whether either such option is
exercised, so long as a Defaulting Partner remains in default, it
(x) shall have no right to receive any cash distributions, and all
such distributions in respect of the Interests held by such
Defaulting Partner may be applied against such unpaid obligations,
(y) shall not be entitled to exercise any voting rights, and (z)
shall not have the right to inspect the books of account specified
in Section 5.01 hereof. For purposes hereof, any partial payment by
a Limited Partner on account of its obligation to make the Second
Installment of Subscribed Capital, Third Installment of Subscribed
Capital or Fourth Installment of Subscribed Capital shall be
allocated pro rata to all of the Interests owned by such Limited
Partner. In the event the General Partner exercises the option set
forth in clause (ii) above, the amount then contained in the
Defaulting Partner's Capital Account shall be allocated among the
Non-Defaulting Partners (defined below) in proportion to their
respective number of Interests in the Partnership.
(d) The option granted in paragraph (c) (i) above may be exercised by
the General Partner, by giving notice to that effect to the
Defaulting Partner, at any time within one hundred and eighty (180)
days after the due date for payment of the installment that the
Defaulting Partner failed to pay. After the expiration of ten
business days following the date on which the General Partner has
given such notice, the Defaulting Partner may not cure his default
without the consent of the General Partner. Following the expiration
of such 10-day period, the General Partner shall use all reasonable
efforts to notify each other Partner who is not in default hereunder
(a "Non-Defaulting Partner") that they may, within 30 days after the
date of the aforesaid notice to the Defaulting Partner, submit to
the General Partner a written bid to purchase all or any portion of
the Interests of the Defaulting Partner (but not less
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than one Interest unless the Defaulting Partner holds less than one
Interest, in which case any bid shall be for not less than the
entire amount of the portion of an Interest held by the Defaulting
Partner). Within 10 business days after the expiration of such
period for submitting bids, the General Partner shall determine the
highest bids received from the Non-Defaulting Partners (the "LP
Purchasers"); provided, that if no bids are submitted during such
period or if no bid is submitted which provides for payment to the
Defaulting Partner of an amount in excess of 75% of the Drawndown
Capital actually paid to the Partnership by the Defaulting Partner
with respect to the Interests of the Defaulting Partner, then the
General Partner shall be entitled to purchase such Interests by
paying to the Defaulting Partner an amount equal to 75% of the
Drawndown Capital actually paid to the Partnership by the Defaulting
Partner with respect to such Interests. The purchaser(s) of such
Interests, whether the General Partner or one or more LP Purchasers,
shall also undertake to make to the Partnership the additional
capital contributions, if any, required to be made by the Defaulting
Partner on account of such Interests (including the installment of
Subscribed Capital that the Defaulting Partner failed to pay) to the
extent that such additional amounts have not been paid by the
Defaulting Partner. In the event one or more Non-Defaulting Partners
submit identical bids which would have been sufficient to purchase
Interests pursuant to the terms hereof but for the fact that
multiple bids were received, each at the same offer price and for
the same number of Interests, the Interests of the Defaulting
Partner which would otherwise have been purchased by them shall be
allocated among them in proportion to their respective number of
Interests in the Partnership. In the event one or more
Non-Defaulting Partners submit bids which would have been sufficient
to purchase Interests pursuant to the terms hereof but for the fact
that multiple bids were received, each for a different number of
Interests but at the same per-Interest offer price, then, the
Interests of the Defaulting Partner available for purchase hereunder
shall be allocated among such bids so that the bid for the largest
number of Interests is satisfied before any other such bid and the
remaining bids are satisfied so that the larger bids are satisfied
before the smaller bids.
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(e) The closing of the acquisition of the Interests of the Defaulting
Partner by the General Partner or the LP Purchasers, as the case may
be, shall occur on the 15th day after the expiration of the 30-day
period for submitting bids or on the first business day after such
15th day. The closing shall occur at the offices of the Partnership
or at such other place as shall be agreed upon by the General
Partner or the LP Purchaser, as the case may be, and the Defaulting
Partner. At such closing, the General Partner or the LP Purchaser,
as the case may be, shall pay to the Defaulting Partner the purchase
price for the Interests of the Defaulting Partner as described in
paragraph (d) above, and the Defaulting Partner (or the General
Partner acting as attorney-in-fact for the Defaulting Partner
pursuant to the power of attorney granted by each Limited Partner in
paragraph (f) below) shall execute and deliver such agreements,
instruments and other documents as are necessary to transfer to the
General Partner or the LP Purchaser, as the case may be, all of the
Defaulting Partner's right, title and interest in and to the
Defaulting Partner's Interests in the Partnership, free and clear of
all liens, encumbrances and restrictions, other than liens,
encumbrances and restrictions imposed under the terms of this
Agreement. In the event the General Partner purchases the Interests
of a Defaulting Partner, the General Partner shall assume the status
of a Limited Partner in respect thereof in addition to its status as
General Partner.
(f) Each Limited Partner, by its acquisition of Interests, constitutes
and appoints the General Partner, and its duly authorized
representatives acting alone, and any person or entity which becomes
a substitute or additional General Partner of the Partnership, its
agent and attorney-in-fact for the purpose of executing and
delivering any and all agreements, instruments and other documents
necessary to convey such Limited Partner's Interests in the
Partnership to the Partnership pursuant to Section 2.01(c) above or
to the purchaser thereof pursuant to Section 2.01(d), which power of
attorney, being coupled with an interest, is irrevocable and shall
survive the death, dissolution or incapacity of any Limited Partner.
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(g) Notwithstanding anything in this Section 2.01 to the contrary, the
obligations of the Defaulting Partner to the Partnership to make
additional capital contributions shall not be extinguished by the
existence of the option to purchase its Interest described in
Section 2.01(d) above or by the exercise of such option, but only
by, and to the extent of, the payments made in the Defaulting
Partner's place by any purchaser or purchasers of such Interest, and
the Partnership may proceed to collect any amount due from the
Defaulting Partner as and when due, together with interest thereon
from the date for payment stated herein at an annual rate equal to
the three-month LIBOR rate plus 5%, but not exceeding the maximum
rate permitted by law, and all costs and expenses of collection
incurred by the Partnership (including reasonable fees and
disbursements of counsel). The obligations of the Defaulting Partner
to the Partnership to make additional capital contributions shall be
extinguished by the exercise of the option described in Section
2.01(c)(ii) above.
(h) The rights granted to the Partners in this Section 2.01 are in
addition to, and not in lieu of, the rights held by the Partnership
by virtue of the security interest referred to in Section 2.01(a).
(i) Until the first anniversary of the date of this Partnership
Agreement, the General Partner is authorized to accept subscriptions
for the sale of additional Interests and to admit, at any time or
from time to time, such subscribers as additional Partners; provided
that (i) the aggregate number of Interests in the Partnership and in
the Other Fund Entities shall not exceed 200; (ii) each Interest
(other than an Interest for which an investor has committed to
subscribe prior to the date of this Agreement) shall be sold for a
capital commitment equal to such amount as shall be determined by a
majority of the Oversight Board (provided, however, that the minimum
capital commitment shall not be less than $500,000 (except for
Interests purchased by investors with agreements to pay either a
reduced or no placement fee, in which cases the minimum capital
commitment shall be $485,000 plus the placement fee, if any, to be
paid)); provided, that the General Partner may accept subscriptions
for fractional Interests as long as the minimum capital commitment
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of any subscriber is no less than $100,000; and (iii) in no event
shall:
(A) offers or sales of Interests be made to persons in the United
States other than to accredited investors (as such term is
defined in Rule 501(a) of Regulation D, promulgated under the
Securities Act of 1933, as amended (the "Securities Act")), or
to persons elsewhere except where offers and sales are
permitted under such circumstances;
(B) more than 99 investors be beneficial owners of the Interests
at any time; or
(C) any Partner be permitted to acquire 10% or more of the issued
and outstanding Interests if the number of beneficial owners
of such Partner, when added to the number of beneficial owners
of the then-admitted Partners, would result in more than 99
persons being beneficial owners of the Interests at any time.
For purposes of clauses (B) and (C) of this Section 2.01(i), the
number of Partners and the number of beneficial owners shall be
determined by reference to Section 3(c)(1) of the Investment Company
Act of 1940, as amended (the "Investment Company Act"), or to any
successor provisions, laws or announcements.
(j) Each additional Partner shall become a party to this Agreement by
signing (or by authorizing his duly appointed attorney-in-fact to
sign) such number of counterpart signature pages to this Agreement
and such other instrument or instruments, and in such manner and at
such time, as the General Partner shall determine. Upon admission to
the Partnership, each additional Partner shall contribute such
Partner's First Installment of Subscribed Capital (and any other
Installment of Subscribed Capital as shall then have been required
of the other Partners).
(k) The General Partner (or its affiliates) has advanced certain
organizational and offering expenses amounting in value to $_______,
which expenses shall be considered, pursuant to Section 4.02(a)(vii)
below, to be a cash contribution in satisfaction of the General
Partner's obligation to contribute such
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amount to the capital of the Partnership under this Agreement
(provided that any such organizational and offering expenses which
exceed the foregoing amount shall be payable in cash to the General
Partner pursuant to Section 4.02(a)(vii) below). Upon the admission
of additional Partners pursuant to Section 2.01(i) above, the
General Partner shall contribute such additional amounts of cash so
that, following the admission of such Partners, the Capital Account
of the General Partner is equal to at least 1% of the Capital
Accounts of all of the Partners.
(l) No interest shall accrue on any contributions to the capital of the
Partnership, and no Partner shall have the right to withdraw or to
be repaid any capital contributed by such Partner or to receive any
other payment in respect of such Partner's Interest in the
Partnership, except as otherwise specifically provided in this
Agreement.
(m) Each Limited Partner hereby constitutes and appoints the General
Partner, as such Limited Partner's agent and attorney-in-fact for
the purpose of (i) executing, delivering and filing such agreements,
certificates and other instruments as any of said attorneys-in-fact
shall deem necessary or appropriate in order to offer and sell
Interests in the Partnership and to admit subscribers therefor into
the Partnership as Partners and (ii) preparing a Schedule A to this
Agreement, and such amendments to such Schedule A as may be
necessary or appropriate from time to time, to reflect the admission
of the Partners to the Partnership and the agreed upon amounts of
their respective capital contributions. Such Schedule A, or any
amendments thereto as aforesaid, when prepared by any of said
attorneys-in-fact, shall be deemed a part of this Agreement and
incorporated herein by reference, as of the effective date of such
Schedule A or amendment thereto, to the same extent as if attached
hereto and incorporated herein by this reference on the date hereof.
The General Partner shall provide each Partner with a copy of each
amendment to Schedule A, but only if such Partner is a Partner
immediately before and after the time of such amendment, and, upon
request, shall provide to any Partner a copy of each instrument
executed by the General Partner pursuant to clause (i) above. The
power of attorney contained in this Section 2.01(m) is coupled with
an
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interest and, therefore, is irrevocable. This power of attorney
shall survive the death, dissolution or incapacity of any Partner.
2.02 Certain Definitions.
For purposes of this Agreement, unless the context otherwise requires, the
following terms shall have the following respective meanings:
(a) "Carrying Value" means, with respect to any asset, the asset's
adjusted basis for federal income tax purposes, except as follows:
(i) The initial Carrying Value of any asset contributed to the
Partnership shall be such asset's gross fair market value at
the time of such contribution;
(ii) The Carrying Values of all Partnership assets shall be
adjusted to equal their respective gross fair market values
upon an adjustment to the Partners' Capital Accounts as
provided in Section 2.03(c) hereof; and
(iii) If the Carrying Value of an asset has been determined pursuant
to clause (i) or (ii) of this subsection (a), such Carrying
Value shall thereafter be adjusted in the same manner as would
the asset's adjusted basis for federal income tax purposes
except that depreciation deductions shall be computed in
accordance with Section 2.02(b)(i) hereof.
(b) "Net Profits" and "Net Losses" mean the taxable income or loss, as
the case may be, for a period (or from a transaction) as determined
in accordance with Section 703(a) of the Internal Revenue Code of
1986, as amended (the "Code"), computed with the following
adjustments:
(i) Items of gain, loss, and deduction shall be computed based
upon the Carrying Values of the Partnership's assets rather
than upon the assets' adjusted bases for federal income tax
purposes, and, in particular, the amount of any deductions for
depreciation or amortization with respect to an asset for a
period shall equal such asset's Carrying Value multiplied by a
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fraction the numerator of which shall be the amount of
depreciation or amortization with respect to such asset
allowable for federal income tax purposes for such period and
the denominator of which shall be such asset's adjusted basis;
(ii) Any tax-exempt income received by the Partnership shall be
included as an item of gross income;
(iii) The amount of any adjustments to the Carrying Values of any
assets of the Partnership pursuant to Code Section 743 shall
not be taken into account; and
(iv) Any expenditure of the Partnership described in Code Section
705(a)(2)(B) (including any expenditures treated as being
described in Section 705(a)(2)(B) pursuant to Treasury
Regulations under Code Section 704(b)) shall be treated as a
deductible expense.
(c) "Excess Negative Balance" for a Partner means the excess, if any, of
(i) the negative balance in a Partner's Capital Account after
reducing such balance by the net adjustments, allocations and
distributions described in Treasury Regulation Section
1.704-1(b)(2)(ii)(d)(4), (5) and (6) which, as of the end of the
Partnership's taxable year, are reasonably expected to be made to
such Partner, over (ii) the sum of (A) the amount, if any, which the
Partner is required to restore to the Partnership upon liquidation
of such Partner's Interest in the Partnership (or which is so
treated pursuant to Treasury Regulations Section
1.704-1(b)(2)(ii)(c)), and (B) that portion of any indebtedness of
the Partnership with respect to which the Partner bears the economic
risk of loss that such indebtedness would not be repaid out of the
Partnership's assets if all of the Partnership's assets were sold at
their respective Carrying Values as of the end of the fiscal year or
other period and the proceeds from the sales together with any
amounts described in clause (A), above, were used to pay the
Partnership's liabilities.
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(d) "Fiscal Period" means each twelve-month period (or portion thereof,
with respect to any partial year) ending on December 31 of any year
of the Partnership's existence.
2.03 Capital Accounts.
A separate account (a "Capital Account") shall be maintained for each
Partner and adjusted in accordance with regulations under Code Section
704. To the extent consistent with such regulations, the following
adjustments to such accounts shall be made:
(a) There shall be credited to each Partner's Capital Account the amount
of any cash actually contributed by such Partner (not including the
placement fee, if any, paid by such Partner) to the capital of the
Partnership, the fair market value of any property contributed by
such Partner to the capital of the Partnership and such Partner's
share of the Net Profits of the Partnership and of any items in the
nature of income or gain separately allocated to the Partners; and
there shall be charged against each Partner's Capital Account the
amount of all cash distributions to such Partner, the fair market
value (without regard to Code Section 7701(g)) of any property
distributed to such Partner by the Partnership (net of any liability
secured by such property that the Partner is considered to assume or
take subject to or under Code Section 752) and such Partner's share
of the Net Losses of the Partnership and of any items in the nature
of losses or deductions separately allocated to the Partners.
(b) If the Partnership at any time distributes any of its assets in-kind
to any Partner, the Capital Account of each Partner shall be
adjusted to account for that Partner's allocable share (as
determined under Sections 2.04, 2.05 and 2.06 below) of the Net
Profits or Net Losses that would have been realized by the
Partnership had it sold the assets that were distributed at their
respective fair market values (taking Code Section 7701(g) into
account) immediately prior to their distribution.
(c) If elected by the General Partner, upon (i) any increase in a
Partner's interest in the Partnership resulting from any non de
minimis contribution of cash or property by such Partner to the
Partnership
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or (ii) any reduction in a Partner's interest in the Partnership
resulting from any non de minimis distribution to such Partner in
redemption of all or a portion of such Partner's interest in the
Partnership, and (iii) whenever else allowed under applicable
Treasury Regulations, the Capital Account balance of each Partner
shall be adjusted to reflect the Partner's allocable share (as
determined pursuant to Sections 2.04, 2.05 and 2.06 below) of the
Net Profits or Net Losses that would be realized by the Partnership
if it sold all of its property at its fair market value (taking Code
Section 7701(g) into account) on the date of the adjustment.
(d) In the event any Interest in the Partnership is transferred in
accordance with the terms of this Agreement, the transferee shall
succeed to the Capital Account of the transferor to the extent it
relates to the transferred Interest.
2.04 General Allocations of Net Profits and Net Losses.
(a) Except as provided in Section 2.05 below, for any Fiscal Period the
Net Profits of the Partnership from any source, including the
receipt of interest and dividends or from a sale or other
disposition of all or any portion of the Partnership's property
(including Net Profits deemed realized from distributions of
property in kind and including positive adjustments to Capital
Accounts resulting from an election pursuant to Section 2.03(c)
hereof) or upon liquidation of the Partnership shall be allocated to
and among the Partners in accordance with their respective number of
Interests in the Partnership.
(b) Except as provided in Section 2.05 below, for any Fiscal Period the
Net Losses of the Partnership from any source, including operations
or from a sale or other disposition of all or any portion of the
Partnership's property (including Net Losses deemed realized from
distributions of property in kind and including negative adjustments
to Capital Accounts specified in Section 2.03(c) hereof) or upon
liquidation of the Partnership shall be allocated to and among the
Partners in accordance with their respective number of Interests in
the Partnership.
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2.05 Overriding Allocations of Net Profits and Net Losses.
Notwithstanding the provisions of Section 2.04 above, the following
allocations of Net Profits and Net Losses and items thereof shall be made:
(a) If at the end of any Partnership taxable year a Partner's
Capital Account has an Excess Negative Balance, then items of
gross income (computed with the adjustments set forth in
clauses (i), (ii) and (iii) of Section 2.02(b) hereof for such
period (and, if necessary, subsequent periods) shall first be
allocated to such Partner in an amount equal to such Partner's
Excess Negative Balance.
(b) In no event shall Net Losses of the Partnership be allocated
to a Partner if such allocation would cause or increase an
Excess Negative Balance in such Partner's Capital Account and
such Net Losses shall be allocated among the other Partners in
accordance with Section 2.04 hereof (subject to the provisions
of this Section 2.05(b)).
(c) In the event that Net Profits, Net Losses or items thereof are
allocated to one or more Partners pursuant to subsections (a)
or (b) above, subsequent Net Profits and Losses will first be
allocated (subject to the provisions of subsections (a) and
(b)) to the Partners having a Capital Account balance equal to
what it would have been had the original allocation of Net
Profits, Net Losses or items thereof pursuant to subsections
(a) or (b) not occurred.
(d) Except as otherwise provided herein or as required by Code
Section 704, for tax purposes, all items of income, gain,
loss, deduction or credit shall be allocated to the Partners
in the same manner as are Net Profits and Net Losses;
provided, however, that if the Carrying Value of any property
of the Partnership differs from its adjusted basis for tax
purposes, then items of income, gain, loss, deduction or
credit related to such property for tax purposes shall be
allocated among the Partners so as to take account of the
variation between the adjusted basis of the property for tax
purposes and its Carrying
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Value in the manner provided for under Code Section 704(c).
(e) Except as provided in subsection (a) above, the interest of
the General Partner in each item of Partnership income, gain,
loss, deduction, or credit will be equal to at least one
percent (1%) of each of those items at all times during the
existence of the Partnership.
(f) In the event that the Partnership incurs any nonrecourse
indebtedness or partner nonrecourse indebtedness, allocations
of deductions attributable to such indebtedness and
allocations of minimum gain shall be made in accordance with
the provisions of the applicable Treasury Regulations
promulgated under Code Section 704(b).
(g) Each Limited Partner shall be allocated the expense associated
with any placement fee (together with any expense
reimbursements) or other costs payable by the Partnership in
connection with the acquisition of Interests by such Limited
Partner.
2.06 Allocations Upon Transfer or Admission.
In the event that a Partner acquires an Interest in the Partnership either
by transfer from another Partner or by acquisition from the Partnership,
all Net Profits and Net Losses of the Partnership arising prior to or in
connection with such acquisition or transfer (including adjustments to
Capital Accounts pursuant to Section 2.03(c) hereof) shall be allocated
among the Partners without giving effect to such acquisition or transfer.
All other Net Profits and Net Losses of the Partnership shall be allocated
among the Partners after giving effect to such acquisition or transfer.
2.07 Special Allocations.
The General Partner may amend the provisions of this Agreement relating to
the allocations of Net Profits, Net Losses and items thereof among the
Partners if the Partnership is advised at any time by the Partnership's
certified public accountants or legal counsel that in their opinion it is
likely that such allocations would not be respected for Federal income tax
purposes, but only to the extent necessary to give such provisions a basis
on which such allocations would likely be
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respected in accordance with the advice of such accountants or legal
counsel, so that any such amendment will have the least possible effect on
such provisions set forth in this Agreement. Such amendment may include
retroactive revaluation of the Partnership's assets as of the date of this
Agreement if necessary to have the allocations set forth in this Article
II have substantial economic effect pursuant to Treasury Regulation
Section 1.704-1(b)(2)(iv)(f) and (g). Any such amendment shall be
deemed to be made in compliance with the fiduciary obligation of the
General Partner to the Partnership and the Limited Partners, and no such
amendment shall give rise to any claim or cause of action by any Limited
Partner. A copy of any such amendment shall be provided promptly to the
Limited Partners.
2.08 Guaranteed Payments.
Notwithstanding anything to the contrary provided in this Agreement, in
the event that any fees, interest or other amounts paid to any one or more
of the Partners and deducted by the Partnership, are disallowed as
deductions to the Partnership on its federal income tax return and are
treated as Partnership distributions, then (i) the Net Profits of the
Partnership shall be decreased and the Net Losses of the Partnership shall
be increased, as the case may be, for the years in which such fees,
interest or other amounts were paid, by the amount of such fees, interest
or other amounts that are treated as Partnership distributions; (ii) there
shall be allocated to such Partners prior to the allocations pursuant to
this Agreement, an amount of gross income for the year in which such fees,
interest or other amounts were paid equal to the amount of such fees,
interest or other amounts that are treated as Partnership distributions;
and (iii) the amounts of such fees, interest or other amounts shall be
deemed to have been distributed by the Partnership to such Partners and
shall be appropriately reflected in the Capital Accounts of such Partners.
In such event, an amount of expense equal to that portion of any cash
distribution that is recharacterized as a guaranteed payment shall be
specially allocated to the Partner receiving such guaranteed payment.
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3. DISTRIBUTIONS
3.01 Distributions of Partnership Cash During the Partnership Term.
(a) For purposes of this Agreement, "Distributable Cash" means, with
respect to any Fiscal Period, the excess of all cash receipts of the
Partnership, including income earned on investments, sales of assets
and any and all other sources, including amounts released from
reserves, over the sum of the following amounts:
(1) expenses of the types which are to be borne by the Partnership
pursuant to Section 4.03 and all fees payable by the
Partnership;
(2) payments of interest, principal and premium under any
indebtedness of the Partnership;
(3) amounts set aside as reserves by the General Partner as
necessary to meet the current or anticipated future needs of
the Partnership (including follow-on investments);
(4) at the election of the General Partner, proceeds from the sale
of investments in Polish Issuers prior to the Commitment
Termination Date representing a return to the Partnership of
Drawndown Capital;
(5) prior to the fifth anniversary of the date hereof, amounts
representing Drawndown Capital which has not yet been invested
in Polish Issuers; and
(6) payments for fees and expenses incurred in connection with the
organization of the Partnership and the sale of Interests
therein.
(b) Following the first anniversary of the date of this Agreement,
Distributable Cash shall be distributed to and among the Partners in
proportion to their respective number of Interests in the
Partnership, at such times and in such amounts as shall be
determined by the General Partner (but not less than annually).
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3.02 Certain Payments to the Internal Revenue Service Treated as Distributions.
(a) For purposes of this Section 3.02, the General Partner may assume
that any Limited Partner who fails to provide to the General Partner
satisfactory evidence of its tax status for United States federal
income tax purposes is a foreign person taxable as a corporation.
(b) Notwithstanding anything to the contrary herein, to the extent that
the Partnership is required, or elects, pursuant to applicable law,
either (i) to pay tax (including estimated tax) on a Limited
Partner's allocable share of the Partnership's items of income or
gain, whether or not distributed, or (ii) to withhold and pay over
to the tax authorities any portion of a distribution otherwise
distributable to a Limited Partner, the General Partner may pay over
such tax or such withheld amount to the tax authorities, and such
amount shall be treated as a distribution to such Limited Partner at
the time it is paid to the tax authorities.
4. MANAGEMENT
4.01 Authority of the General Partner.
Except as otherwise expressly provided in this Agreement or by law, all
decisions respecting any matter set forth herein or otherwise affecting or
arising out of the conduct of the business of the Partnership shall be
made by the General Partner. The General Partner shall have the exclusive
right and full authority to manage, conduct and operate the Partnership
business on the terms and conditions described herein. Notwithstanding the
foregoing, the General Partner shall not take any actions on behalf of the
Partnership, or cause the Partnership to take any actions (other than with
respect to matters which are applicable to the Partnership and the
Partners hereof because of laws, rules and regulations applicable to the
Partnership and its Partners which are not so applicable to the Other Fund
Entities or the partners thereof (including the Delaware Act and the Code,
or any portions thereof)), unless the same actions shall have been duly
authorized and taken by, or on behalf of, the Other Fund Entities and are
reasonably necessary or advisable to carry out the purposes of the
Partnership.
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The execution of any agreement, certificate or other document by the
General Partner on behalf of the Partnership shall be sufficient to
legally bind the Partnership with respect to its dealings with third
parties. Specifically, but not by way of limitation, but subject to the
restrictions set forth in the Joint Management Agreement and in this
Agreement, the General Partner shall be authorized in the name and on
behalf of the Partnership:
(a) To use Partnership assets to buy, sell, hold and otherwise invest in
and deal with securities and short-term investments, and in options
and other rights with respect to the foregoing;
(b) To employ one or more custodians of the assets of the Partnership
and authorize such custodians to employ subcustodians and agents and
to deposit all or any part of such assets in a system or systems for
the central handling of securities or with such other person or
persons as the General Partner may determine, and to pay such fees,
expenses, salaries, wages and other compensation to such custodians
and subcustodians as it shall in its sole discretion determine
necessary, desirable or appropriate;
(c) To effect transactions in securities owned by the Partnership with
such broker-dealers as the General Partner may deem appropriate;
(d) Subject to Section 4.02(b) (vi) hereof, to buy, sell and deal in all
types of foreign currencies, foreign exchange and derivative
securities thereof;
(e) To employ such other agents, employees, accountants, attorneys,
consultants and other persons (including the Manager and the
Advisor), which may be affiliated with the General Partner,
reasonably necessary or appropriate to carry out the business and
affairs of the Partnership, and, subject to Section 2 of the Joint
Management Agreement, to cause the Partnership to pay such fees,
expenses, salaries, wages and other compensation to such persons as
shall reasonably be necessary, desirable or appropriate;
(f) To execute, deliver and perform such contracts, agreements,
documents and other instruments as it may deem necessary,
appropriate or incidental to the
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accomplishment of the purposes of the Partnership or the conduct of
its business;
(g) To make any and all other expenditures which are reasonably
necessary or appropriate in connection with the management of the
affairs of the Partnership and the carrying out of its obligations
and responsibilities under this Agreement;
(h) To acquire property, real or personal, as is reasonably necessary or
appropriate for the conduct of the Partnership's business and to
sell, exchange, or otherwise dispose of all or any part of the
Partnership's property;
(i) To pay, extend, renew, modify, adjust, submit to arbitration,
prosecute, defend or compromise, upon such terms as it may determine
and upon such evidence as it may deem sufficient, any obligation,
suit, liability, cause of action or claim, including taxes, either
in favor of or against the Partnership provided that the General
Partner shall notify the Limited Partners of any material
arbitrations, prosecutions or compromises made by the General
Partner;
(j) To take any action of any nature whatsoever necessary to offer and
sell limited partnership interests in the Partnership as permitted
by Section 2.01(i) above;
(k) To vote, give assent and otherwise exercise all rights, powers,
privileges and other incidents of ownership or possession with
respect to the securities and other assets of the Partnership; and
execute and deliver proxies or powers of attorney to such person or
persons as the General Partner shall deem proper, granting to such
person or persons such power and discretion with respect to such
securities or other assets as the General Partner shall deem proper;
(l) To exercise powers and rights which in any manner arise out of
ownership of securities, including without limitation subscription
rights;
(m) To hold any security or other assets in a form not indicating any
particular owner, whether in bearer, unregistered or other
negotiable form, or in the name
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of the Partnership, a custodian, subcustodian or other depositary or
a nominee or nominees;
(n) To join with other security holders in acting through a committee,
depositary, voting trust or otherwise, and, in connection therewith,
deposit any security with, or transfer any security to, any such
committee, depositary or trustee, and delegate to any person or
persons such power and authority with respect to any security
(whether or not so deposited or transferred) as the General Partner
shall deem proper, and pay such portion of the expenses and
compensation of such committee, depositary or trustee as the General
Partner shall deem proper;
(o) To compromise the obligation of a Partner to make a contribution to
the capital of the Partnership or to return to the Partnership money
or other property paid or distributed to such Partner;
(p) To establish and maintain reserves for such purposes and in such
amounts as it deems appropriate from time to time; and
(q) To exercise all powers and authority granted by the Delaware Act to
general partners, except as otherwise provided in this Agreement.
With respect to all of its obligations, powers and responsibilities under
this Agreement, the General Partner is authorized to execute and deliver,
for and on behalf of the Partnership, such instruments and agreements as
are reasonably necessary, all on such terms and conditions as are
reasonably necessary.
4.02 Restrictions on the Authority of the General Partner.
(a) The General Partner shall not:
(i) do any act in contravention of this Agreement or the
restrictions set forth in the Joint Management Agreement;
(ii) possess or assign rights in specific Partnership property
other than for a Partnership purpose;
(iii) admit a person or entity as a Partner, except as provided in
this Agreement;
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(iv) knowingly perform any act that would subject any Limited
Partner to liability as a general partner in any
jurisdiction;
(v) knowingly perform any act, or cause the Partnership to
perform any act, which would result in the Partnership being
classified as an investment company under the Investment
Company Act or as a publicly traded partnership as defined in
Code Section 469(k)(2) or Code Section 7704(b);
(vi) charge or pay, or cause the Partnership to charge or pay, any
commission with respect to the offer or sale of Interests,
other than as contemplated by the Memorandum;
(vii) other than up to $600,000 payable in the aggregate to the
General Partner and the general partner(s) of the Other Fund
Entities (or their affiliates) in reimbursement of certain
organizational and offering expenses (reduced pro rata to the
extent the aggregate number of Interests sold in the
Partnership and in the Other Fund Entities prior to the first
anniversary of the date hereof is less than 100), cause the
Partnership to reimburse the General Partner or any of its
affiliates for organizational or offering expenses, or the
salaries, benefits and other compensation costs of its
employees or its rent and other overhead costs, including
utilities or telephone but excluding travel costs incurred
specifically on behalf of the Partnership; or
(viii) cause the Partnership to make any loan to the General Partner
or any affiliate of the General Partner.
(b) Without the agreement of the Partners and the partners of the Other
Fund Entities who collectively own a majority of the aggregate
number of Interests in the Partnership and in the Other Fund
Entities (for purposes of this Section 4.02(b), each unit owned by a
partner of any Other Fund Entities shall also be deemed to be an
Interest, and such number of Partners and partners of Other Fund
Entities is hereinafter referred to as a "Majority-in-Interest of
the Fund's
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Partners"), the Partnership shall not and accordingly the General
Partner shall not:
(i) issue senior securities (including borrowing money from
banks), except borrowings, denominated in Polish currency and
for short term operating purposes only, in amounts
outstanding at any one time not to exceed, prior to the
Commitment Termination Date, 10% of the Subscribed Capital of
the Partnership and thereafter, 10% of the Total Drawndown
Capital of the Partnership (measured at the time of the
borrowing);
(ii) invest, prior to the Commitment Termination Date, more than
15% of the Subscribed Capital of the Partnership, and
thereafter, more than 15% of the Total Drawndown Capital of
the Partnership (measured at the time of investment), in the
securities of any single issuer;
(iii) generally invest, prior to the Commitment Termination Date,
more than 25% of the Subscribed Capital of the Partnership,
and thereafter, more than 25% of the Total Drawndown Capital
of the Partnership (measured at the time of investment), in
the securities of any single industry;
(iv) purchase or write options or sell securities short or
otherwise maintain short positions;
(v) purchase or sell commodities or commodity futures;
(vi) purchase or sell currency and currency futures contracts and
options thereon or enter into forward foreign currency
contracts except in connection with currency hedging
permitted by the Partnership's Investment Policies as in
effect from time to time;
(vii) make loans of money, provided, however, that the purchase by
the Partnership of debt securities, commercial paper and
other money market instruments or the making of loans to or
guaranties on behalf of Polish Issuers in accordance with the
Partnership's Investment
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Policies shall not constitute the making of a loan for
purposes hereof;
(viii) invest in oil, gas or mineral-related programs or leases
(including, without limitation, interests in limited
partnerships which invest in oil, gas or other minerals)
provided that the Partnership may invest in securities issued
by companies that invest in or otherwise own oil, gas or
other minerals or interests therein;
(ix) purchase or sell real estate (including, without limitation,
real estate limited partnership interests), provided that the
Partnership may (a) invest in securities secured by real
estate or interests therein or issued by companies that
invest in or otherwise own real estate or interests therein,
and (b) hold and sell real estate acquired as a result of its
ownership of securities; or
(x) (A) guarantee the indebtedness of a portfolio company in
excess of 25% of the Partnership's investment in such
company; or (B) guarantee the indebtedness of portfolio
companies in excess of 10% of the aggregate Subscribed
Capital of the Partnership (or, after the Commitment
Termination Date, of the Total Drawndown Capital); or (C)
grant any liens on its assets.
For purposes hereof, the restrictions in clauses (i) through (x)
above are hereinafter referred to as the Partnership's "Investment
Restrictions".
(c) Without the agreement of Partners and the partners of the Other Fund
Entities who own in the aggregate at least 75% (66 2/3% in the
situation specified in Section 1(c)(5) of the Joint Management
Agreement) of the aggregate number of Interests in the Partnership
and in the Other Fund Entities (including the approval of (i) the
EBRD so long as the EBRD owns any Interest in the Partnership or any
Other Fund Entities, (ii) DEG so long as DEG continues to own at
least the lesser of (A) ten percent (10%) of the aggregate number of
Interests in the Partnership and the Other Fund Entities or (B) 11.3
Interests, and (iii) the Pittsburgh Representative so long as the
Pittsburgh Group continues to own at least 10.5 Interests) (for
purposes of this Section 4.02(c), each unit owned by a partner of
any
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Other Fund Entities shall also be deemed to be an Interest, and such
number of Partners and partners of the Other Fund Entities is hereinafter
referred to as a "Super-Majority-in-Interest of the Fund's Partners"), the
Partnership shall not and accordingly the General Partner shall not:
(i) modify any Investment Policies in a manner which deviates from
the Investment Objective of the Partnership; or
(ii) take any action which, under the terms of the Joint Management
Agreement, requires the consent of a
Super-Majority-in-Interest of the Fund's Partners.
4.03 Expenses of the Partnership; Reimbursement of the General Partner.
Subject to Section 2 of the Joint Management Agreement and Section
4.02(a)(vii) hereof, the Partnership shall pay directly or reimburse the
General Partner and its affiliates for, as Partnership expenses, all
expenses associated with the business of the Partnership which are not
payable by the Manager pursuant to the Joint Management Agreement.
4.04 Services of the General Partner.
During the existence of the Partnership, the General Partner shall devote
such time and effort to the Partnership's business as may be necessary to
promote adequately the interests of the Partnership and the mutual
interests of the Partners; however, it is specifically understood and
agreed that neither the General Partner nor any of its affiliates shall be
required to devote its full time to Partnership business, and, except as
set forth in the Joint Management Agreement, each of the General Partner
and such affiliates may at any time and from time to time engage in and
possess an interest in other business ventures of any and every type and
description, independently or with others, including without limitation
ventures involving investing in securities or managing or participating in
other funds, and neither the Partnership nor any Partner shall by virtue
of this Agreement have any right, title or interest in or to such
independent ventures.
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4.05 Compensation and Dealings with Partnership.
Except as provided in Sections 4.01, 4.02 and 4.03 or as otherwise
expressly permitted by this Agreement or the Joint Management Agreement,
and except for the interests granted to the General Partner hereunder, or
subsequently acquired pursuant to the terms hereof, in the profits and
losses of and distributions from the Partnership and such interests
therein as may be held by affiliates of the General Partner by virtue of
their being Limited Partners hereunder, neither the General Partner nor
any of its affiliates shall receive any compensation for services rendered
in connection with the management or operation of the Partnership or its
business. For purposes of this Agreement, "affiliate" of any individual or
entity means any individual or entity that, directly or indirectly through
one or more intermediaries, controls, is controlled by or is under common
control with such individual or entity. The term "control" means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of an individual or entity,
whether through the ownership of voting securities, by contract or
otherwise.
4.06 Liability of the General Partner; Indemnification.
(a) Neither the General Partner, nor any of its affiliates (an
"Indemnified Party") shall have any liability to the Partnership or
to any Partner for any loss suffered by the Partnership which arises
out of any action or inaction of any Indemnified Party if such
Indemnified Party determined reasonably and in good faith that the
action or inaction was in or not opposed to the best interests of
the Partnership and the action or inaction did not constitute
Negligence or intentional misconduct of the Indemnified Party. Each
Indemnified Party shall be indemnified by the Partnership against
any losses, judgments, liabilities, expenses and amounts paid in
settlement of any claims sustained by them which arise out of any
action or inaction of such Indemnified Party if such Indemnified
Party determined reasonably and in good faith that such action or
inaction was in or not opposed to the best interests of the
Partnership and such action or inaction did not constitute
Negligence or intentional misconduct of the Indemnified Party. The
Partnership shall not indemnify any Indemnified
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Party in connection with a proceeding (or part thereof) initiated by
such Indemnified Party unless the initiation thereof was approved by
a majority of the Independent Board Members (as defined in the Joint
Management Agreement). The indemnification rights provided in this
Section 4.06 (i) shall not be deemed exclusive of any other rights
to which an Indemnified Party may be entitled under any law,
agreement or vote of the Partners of the Partnership and the
partners of the Other Fund Entities, and (ii) shall inure to the
benefit of the heirs, executors and administrators of such persons.
For purposes of this Agreement, "Negligence" by any person or entity
means the failure of such person, other than in the exercise of such
person's good faith business judgment, to perform a manifest duty in
disregard of the consequences of the action or omission constituting
such failure, taking into account in determining whether such person
has been Negligent, the facts available to such person at the time
of such failure and the circumstances then existing.
(b) Except as provided in Section 4.08, the reimbursement and indemnity
obligations of the Partnership under this Agreement shall:
(i) be paid from, and only to the extent of, Partnership assets,
and no Partner shall have any personal liability on account
thereof;
(ii) be in addition to any liability which the Partnership may
otherwise have;
(iii) extend upon the same terms and conditions to the directors,
officers, employees and affiliates of each Indemnified Party;
and
(iv) be binding upon and inure to the benefit of any successors,
assigns, heirs and personal representatives of each
Indemnified Party.
(c) An Indemnified Party shall ensure that all reasonable steps are
taken to avoid or mitigate any loss or liability which might give
rise to an indemnification under this Section 4.06. An Indemnified
Party shall exercise reasonable care in the selection, instruction,
engagement, retention and supervision of agents. If an Indemnified
Party becomes aware of a
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matter that may give rise to its ability to be indemnified under
this Section 4.06 it shall use all reasonable efforts to give notice
of such matter as soon as practicable thereafter to the Limited
Partners.
4.07 Limitations on Limited Partners.
(a) None of the Limited Partners shall:
(i) be permitted to take part in the management or control of the
business or affairs of the Partnership;
(ii) have any voice in the management or operation of any
Partnership property; or
(iii) have the authority or power in his or her capacity as a
Limited Partner to act as agent for or on behalf of the
Partnership or any other Partner, to do any act which would be
binding on the Partnership or any other Partner, or to incur
any expenditures on behalf of or with respect to the
Partnership.
(b) Each Limited Partner may himself or through his agent or through any
one or more of the members of the Oversight Board inspect the
accounts of the Partnership and examine into the state and prospects
of the Partnership business and advise with the Partners thereon.
4.08 Liability of Limited Partners.
So long as each Limited Partner complies with the provisions of Section
4.07, the liability of such Limited Partner for the losses, debts and
obligations of the Partnership shall be limited to such Limited Partner's
respective capital contribution and the Limited Partner's share of any
undistributed net profits; provided, however, that under applicable
partnership, fraudulent conveyance, or similar laws, a Limited Partner may
be liable to the Partnership to the extent of previous distributions made
to such Limited Partner, with interest, in the event that the Partnership
does not have sufficient assets to discharge its liabilities.
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4.09 Voluntary Withdrawal and Expulsion of a General Partner.
(a) Except in connection with the admission to the Partnership of a
general partner which is an assignee of the Interest of a General
Partner as provided in Section 6.02, or in connection with the
removal of the Manager pursuant to the Joint Management Agreement,
no General Partner shall voluntarily retire or withdraw from the
Partnership.
(b) The owners of a majority of the aggregate number of Interests in the
Partnership (a "Majority-in-Interest of the Partnership's Partners")
may expel the General Partner from the Partnership in the event any
of the following has occurred:
(i) any action by the General Partner has been determined by a
court of competent jurisdiction to constitute fraud against
the Partnership;
(ii) the General Partner or any affiliate of the General Partner
has been convicted of any felony (but only if such conviction
has had a material adverse effect on the reputation of the
Partnership);
(iii) a court of competent jurisdiction has determined that the
General Partner has committed a material breach of its
fiduciary obligations to the Partnership;
(iv) a court of competent jurisdiction has determined that the
General Partner has recklessly or wilfully committed a
material breach of the provisions of this Agreement or has
been Negligent in carrying out or failing to carry out its
duties hereunder;
provided that, in any of such cases, the judgment of the court of
competent jurisdiction is a final judgment with no right of appeal
and further provided that no such decision to expel the General
Partner shall be effective until the appointment of one or more
General Partners to replace the General Partner, such appointment to
be made by a Majority-in-Interest of the Partnership's Partners
(provided that any such successor General Partner shall be an
affiliate of the general partners of the Other Fund Entities or any
successors thereto).
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4.10 Withdrawal of a General Partner.
After a General Partner's bankruptcy, death, expulsion, dissolution (other
than the dissolution of a General Partner which itself is a general or
limited partnership and which does not wind up its business following the
dissolution, but instead reconstitutes itself and continues its business),
adjudication of incompetence or withdrawal (other than a withdrawal
resulting from an assignment of all of the General Partner's Interest in
the Partnership pursuant to Section 6.02 below), such General Partner's
Interest shall (a) immediately, if there is then another general partner,
or (b) immediately upon the election of a new general partner in
accordance with Section 7.01(b), if no other general partner then existed,
become that of a Limited Partner (without the necessity of receiving the
consent of any other Partner). In such event, such General Partner shall
cease to have any right to participate in any manner in the management or
control of the business of the Partnership, but such General Partner's
interest in the Net Profits and Net Losses and distributions of the
Partnership shall remain unchanged. Any Limited Partner may obtain from
the Partnership a list of all the Limited Partners and their addresses
and, as provided in Section 7.01(b) hereof, a meeting may be called for
the purpose of appointing one or more General Partners pursuant hereto.
4.11 Meetings of the Limited Partners.
(a) Meetings of the Limited Partners for any purpose (including the
designation of representatives to the Oversight Board pursuant to
the Joint Management Agreement or the other matters set forth in
Section 4.02 above) may be called by the General Partner at any time
and shall be called by the General Partner (i) before June 30, 1996
and thereafter before June 30 in each calendar year; and (ii) within
ten days after written request for such a meeting signed by (A) a
majority of the Oversight Board constituted in the Joint Management
Agreement or (B) 10% in interest of the Partnership's Limited
Partners (as defined below); provided, that no more than one meeting
may be called by Limited Partners during any twelve-month period,
except that meetings called to appoint a new General Partner
pursuant to Section 4.09 or 4.10 hereof shall not be subject to this
limitation and, notwithstanding the foregoing, meetings may be
called at any time by that number of Limited Partners who own more
than 50% of the aggregate number of Interests in the Partnership.
Any such request shall
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state the purpose of the proposed meeting and the matters proposed
to be acted upon thereat. Meetings shall be held at the principal
office of the General Partner or at such other place outside the
United States as may be designated by the General Partner, or, if
the meeting is called upon the request of the Oversight Board or
Limited Partners, such place outside the United States and at such
time as is designated by the Oversight Board or such Limited
Partners. At each meeting, the Limited Partners shall be given the
opportunity to review and discuss the Partnership's investment
activities with the General Partner and a representative of the
Manager and the Advisor. In addition, the General Partner may, and
upon receipt of a written request signed by that number of Limited
Partners who own more than 10% of the aggregate number of Interests
in the Partnership (such number of Limited Partners being referred
to as "10% in interest of the Partnership's Limited Partners"), the
General Partner shall, submit any matter upon which the Limited
Partners are entitled to act to the Limited Partners for a vote by
written consent without a meeting (in which case the vote shall only
be passed if approved by such number of Partners as would have been
required had such vote been taken at a meeting).
(b) Notice of any meeting to be held pursuant to paragraph (a) above or
Section 4.10 hereof shall be given not less than 10 days nor more
than 60 days before the date of the meeting, to each Limited Partner
at his record address on the books of the Partnership, or at such
other address which he may have furnished in writing to the General
Partner of the Partnership. Such notice shall be in writing, and
shall state the place, date and hour of the meeting and shall
indicate (if so) that the notice is being issued at or by the
direction of the Limited Partner or Limited Partners calling the
meeting. If a meeting is adjourned to another time or place, and if
an announcement of the adjournment or time or place is made at the
meeting, it shall not be necessary to give notice of the adjourned
meeting.
(c) For the purpose of determining the Partners entitled to vote at any
meeting of the Partners, or any adjournment thereof, or to vote by
written consent without a meeting, the General Partner (or, in the
case of votes to be taken at meetings called pursuant to Section
4.10 hereof, the Limited Partner or Partners calling the meeting)
may fix, in advance, a date as the record date
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for any such determination of Partners. Such date shall not be more
than 50 days nor less than ten days before any such meeting or
submission of a matter to the Partners for a vote by written consent.
(d) Each Partner may authorize any person or persons to act for him by
proxy with respect to any matter in which such Partner is entitled to
participate, whether by waiving notice of any meeting, or voting or
participating at a meeting. Every proxy must be signed by the Partner
or his attorney-in-fact. No proxy shall be valid after the expiration
of 12 months from the date thereof unless otherwise provided in the
proxy. Every proxy shall be revocable at the pleasure of the Partner
executing it.
(e) At each meeting of Partners, the Partners present or represented by
proxy shall elect such officers and adopt such rules for the conduct
of such meeting as they shall deem appropriate. For purposes of
determining whether a matter has been approved by a
Majority-in-Interest of the Fund's Partners or the applicable
Super-Majority-in-Interest of the Fund's Partners, the vote on such
matter taken by the partners of any or all of the Other Fund Entities
may, but need not be, taken simultaneously and at the same meeting as
the vote on such matter taken by the Partners, and the votes of
partners of the Other Fund Entities shall be aggregated with the votes
of the Partners to determine whether a matter has been approved by a
Majority-In-Interest of the Fund's Partners or the applicable
Super-Majority-In-Interest of the Fund's Partners so long as such
votes are taken not more than 30 days apart.
4.12 EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT.
(a) The Limited Partners agree to vote for a designee of the EBRD as one
of the Limited Partners' representatives on the Oversight Board
designated pursuant to the Joint Management Agreement; PROVIDED, that
such agreement will not apply at any time that the EBRD owns less than
ten percent (10%) of the aggregate number of Interests in the
Partnership and in the Other Fund Entities;
(b) The EBRD agrees that it will always act without unreasonable delay in
connection with any consent or approval being requested of it under
this Agreement or any Fund Document which requires or provides for the
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consent or approval of the EBRD or the EBRD's representative on the
Oversight Board in certain circumstances;
(c) For purposes of this Agreement, "Fund Documents" means: (i) this
Agreement; (ii) the Limited Partnership Agreement of Pioneer Poland
U.K., L.P.; (iii) the Joint Management Agreement; (iv) the Advisory
Agreement between the Manager and the Advisor; (v) the
Administration Agreement to be entered into by the General Partner
and Abacus Asset Management Limited (the "Administrator"), pursuant
to which the Administrator will maintain the books and records of
the General Partner; and (vi) the Administration Agreement to be
entered into between the Manager and the Administrator pursuant to
which the Administrator will maintain the books and records of the
Manager.
4.13 DEG - Deutsche Investitions- und Entwicklungsgesellschaft mbH
(a) The Limited Partners agree to vote for a designee of Deutsche
Investitions und Entwicklungsgeselleschaft ("DEG") as one of the
Limited Partners' representatives on the Oversight Board designated
pursuant to the Joint Management Agreement; provided, that such
voting agreement will not apply at any time that DEG does not own at
least the lesser of (A) ten percent (10%) of the aggregate number of
Interests in the Partnership and the Other Fund Entities or (B) 11.3
Interests.
(b) DEG agrees that it will always act without unreasonable delay in
connection with any consent or approval being requested of it under
this Agreement or any Fund Document which requires or provides for
the consent or approval of DEG or DEG's representative on the
Oversight Board in certain circumstances.
4.14 The Pittsburgh Group
(a) The Limited Partners agree to vote for a joint designee of the
Limited Partners comprising the Pittsburgh Group as one of the
Limited Partners' representatives on the Oversight Board designated
pursuant to the Joint Management Agreement; provided, that such
voting agreement will not apply at any time that the Pittsburgh
Group owns less than 10.5
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Interests; and provided, further, that such voting agreement will
not apply unless all three members of the Pittsburgh Group agree on
such designee.
(b) Each Limited Partner that is a member of the Pittsburgh Group agrees
that it will always cause the Pittsburgh Representative to act
without unreasonable delay in connection with any consent or
approval being requested of him under this Agreement or any Fund
Document which requires or provides for the consent or approval of
the Pittsburgh Representative in certain circumstances.
5. BOOKS, RECORDS AND BANK ACCOUNTS
5.01 Books and Records.
The General Partner shall keep true and correct books of account with
respect to the operation of the Partnership. Such books shall be
maintained at the principal place of business of the Partnership, or at
such other place as the General Partner shall determine, and all Limited
Partners, or their duly authorized representatives, shall at all
reasonable times and on reasonable notice to the General Partner have
access to such books.
5.02 Accounting Basis; Fiscal Year; Tax Matters Partner.
Such books shall be kept on the accrual method of accounting, or on such
other method of accounting as the General Partner may determine, and shall
be closed and balanced at the end of each fiscal year of the Partnership.
The fiscal year of the Partnership shall be the calendar year. The
Partnership's tax matters partner, for purposes of Code Section 6231,
shall be the General Partner. The General Partner may, in its discretion,
make, or refrain from making, any income or other tax elections for the
Partnership that it deems necessary or advisable, including an election
pursuant to Code Section 754.
5.03 Reports.
(a) The General Partner will deliver to each Limited Partner (i) within
90 days after the end of each fiscal year a copy of the balance
sheet of the Partnership as of the end of such year, together with
statements of income and of cash flow for the Partnership, all in
reasonable detail, prepared in accordance with U.S. Generally
Accepted Accounting Principles ("GAAP"),
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audited by a firm of certified public (or chartered) accountants of
international standing appointed by the General Partner and
accompanied by a report thereon of the Partnership's investments as
of such date, a report of the Partnership's activities during the
previous year and the Advisor's analysis of the investment climate
then prevailing in Poland, (ii) within 75 days after the end of each
fiscal year, such tax information as is necessary for such Limited
Partner to prepare and file applicable tax returns; (iii) within 30
days after the end of each calendar quarter, a copy of the balance
sheet of the Partnership as of the end of such quarter, together
with statements of income and cash flow for the Partnership prepared
in accordance with GAAP and accompanied by a description of the
Partnership's investments as of such date; and (iv) within 30 days
after the end of each calendar month, a statement (as of the
preceding month-end Valuation Day (as defined in the Joint
Management Agreement)) of the number of Interests held by the
Limited Partner, and the Net Asset Value per Interest (as calculated
pursuant to the Joint Management Agreement).
(b) The cost of all such reporting shall be paid by the Partnership as a
Partnership expense. Any Partner may, at any time, at his or her own
expense, cause an audit of the Partnership books to be made by a
certified public accountant of his or her own selection.
6. ASSIGNABILITY OF INTERESTS
6.01 Substitution and Assignment of a Limited Partner's Interests.
(a) A Limited Partner may not sell, transfer, assign, pledge or
otherwise dispose of (collectively, "transfer") all or any part of
such Limited Partner's Interests (whether voluntarily, involuntarily
or by operation of law), except in accordance with the following to
the reasonable satisfaction of the General Partner:
(i) no such transfer shall be made unless, in the opinion of
counsel to the Partnership, (x) such transfer would not
require registration under the Securities Act, or otherwise
result in the violation of any other applicable securities
law, (y) such transfer would not require registration
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under the Investment Company Act, and (z) such transfer would
not result in adverse tax consequences to the Partnership or
the Partners thereof (including the Partnership being treated
as an association taxable as a corporation);
(ii) the transferee shall have paid to the Partnership all costs
and expenses incurred by the Partnership in connection with
such transfer;
(iii) the Partnership shall not be required to recognize any such
transfer until the instrument conveying such Interest has been
delivered to the General Partner for recordation on the books
of the Partnership; and
(iv) unless a transferee becomes a substituted limited partner in
accordance with the provisions set forth below, such
transferee shall not be entitled to any of the rights granted
to a Limited Partner hereunder, other than the right (unless
prohibited by Section 6.01(a)(i) hereof) to receive all or
part of the share of the net profits, net losses,
distributions or returns of capital to which the transferor
would otherwise be entitled.
(b) A transferee of the Interest of a Limited Partner, or any portion
thereof, shall become a substituted limited partner having the
rights and powers of, and become subject to the restrictions and
liabilities of, a Limited Partner, as the case may be, if, and only
if:
(i) the transferor gives the transferee such right;
(ii) the transferee pays to the Partnership all costs and expenses
incurred in connection with such substitution, including
specifically, without limitation, costs incurred in amending
the Partnership's then current Certificate of Limited
Partnership, if necessary; and
(iii) the transferee executes and delivers such instruments, in form
and substance satisfactory to the General Partner, as the
General Partner may deem necessary or desirable to effect such
substitution and to confirm the agreement of the transferee to
be bound by all of the terms and provisions of this Agreement.
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(c) Notwithstanding anything to the contrary contained herein, the
General Partner may impose such additional restrictions on the
transfer of Partnership Interests as may be reasonably required, in
the opinion of counsel to the Partnership, to prevent the taxation
of the Partnership for federal income tax purposes as a corporation
or as an association taxable as a corporation, including without
limitation, preventing Partnership Interests from being traded on an
established securities market or readily tradeable on a secondary
market (or the substantial equivalent thereof), and making any
amendment to this Agreement as the General Partner in its reasonable
discretion may determine to be necessary or appropriate in order to
impose such restrictions.
(d) The Partnership and the General Partner shall be entitled to treat
the record owner of any Interest as the absolute owner thereof in
all respects, and shall incur no liability for distributions of cash
or other property made in good faith to such owner until such time
as a written instrument conveying such Interest has been received
and accepted by the General Partner and recorded on the books of the
Partnership and the other conditions for transfer set forth herein
have been satisfied. The General Partner may refuse to accept a
transfer until the end of the next successive quarterly accounting
period. In no event shall any Interest, or any portion thereof, be
transferred to a minor or incompetent, and any such attempted
transfer shall be void and ineffectual and shall not bind the
Partnership or the General Partner.
(e) The death or incompetency of a Limited Partner shall not dissolve
the Partnership. A transferee of an Interest, whether or not it
becomes a substitute limited partner, which desires to make a
further transfer of such Interest shall be subject to all of the
provisions of this Section 6.01 to the same extent and in the same
manner as a Limited Partner desiring to make a transfer of its
Interest.
6.02 Assignment of a General Partner's Interest.
The Interest of a General Partner in the Partnership shall be assignable,
in whole or in part, at any time and from time to time, to any person or
entity so long as such transfer will not, in the opinion of the lawyer to
the Partnership, result in any adverse consequences to the Partnership,
including
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without limitation the withdrawal of Jersey regulatory supervision or the
Partnership's listing on the securities exchange, if any, on which it is
then listed; provided, that in no event shall an assignee of all or a
portion of a General Partner's Interest in the Partnership become a
General Partner or have the authority to participate in the management of
the Partnership or to incur any obligations on behalf of the Partnership,
unless:
(a) the assigning General Partner gives the assignee such right;
(b) the assignee pays to the Partnership all costs and expenses
incurred in connection with such assignment, including
specifically, without limitation, costs incurred in amending
the Partnership's Certificate of Limited Partnership;
(c) the assignee executes and delivers such instruments, in form
and substance satisfactory to the General Partner, as the
General Partner may deem necessary or desirable to effect the
admission of the assignee into the Partnership and to confirm
the agreement of the assignee to be bound by all of the terms
and provisions of this Agreement;
(d) The Partnership receives an opinion of counsel to the
Partnership that the Partnership will continue to be
classified as a partnership for federal income tax purposes
notwithstanding the admission of the new general partner and,
if applicable, the withdrawal of the assignor General Partner;
and
(e) except for assignments to an affiliate of the General Partner,
which shall require no consent, the General Partner and a
Majority-in-Interest of the Partnership's Limited Partners
(including (A) the EBRD so long as the EBRD owns any Interest
in the Partnership, (B) DEG so long as DEG continues to own at
least the lesser of (x) ten percent (10%) of the aggregate
number of Interests in the Partnership and the Other Fund
Entities or (y) 11.3 Interests, and (C) the Pittsburgh
Representative (acting on behalf of the Limited Partners
comprising the Pittsburgh Group) so long as the Pittsburgh
Group continues to own at least 10.5 Interests) consent to the
admission of the assignee into the Partnership as a General
Partner.
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This Agreement constitutes the specific written consent of each Limited
Partner to the admission to the Partnership of a new General Partner upon
the terms, and subject to satisfaction of the conditions, set forth in
this Section 6.02 (other than the consent required by clause (v) above).
Each Limited Partner further acknowledges and agrees that the power of
attorney granted by each Limited Partner pursuant to Section 8.03 below
shall enable the General Partner to execute and record on behalf of such
Limited Partner any and all instruments necessary or appropriate to
reflect the admission of an assignee as an additional or substituted
General Partner as provided in this Section 6.02.
7. DISSOLUTION, TERMINATION AND LIQUIDATION
7.01 Events of Dissolution.
(a) The Partnership shall be dissolved:
(i) as provided in the Joint Management Agreement;
(ii) except as provided in Section 7.01(b) below, upon the General
Partner's bankruptcy, death, expulsion, dissolution (other
than the dissolution of a General Partner which itself is a
general or limited partnership and which does not wind up its
business following the dissolution, but instead continues its
business), adjudication of incompetence or any other event of
withdrawal (as defined in the Delaware Act), unless there is
at least one remaining general partner of the Partnership
(such general partner being hereby authorized to carry on the
business of the Partnership);
(iii) upon the sale or other disposition of all of the Partnership's
assets; or
(iv) in any event, at 12:00 midnight, Boston time, on December 31,
2009.
(b) Notwithstanding the occurrence of an event specified in Section
7.01(a)(ii) hereof, the Partnership shall not be dissolved and its
business and affairs shall not be discontinued, and the Partnership
shall remain in existence as a limited partnership under the laws of
the State of Delaware, if, within 90 days after such occurrence, a
Majority-in-Interest (or such greater
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percentage in interest of the Partners as may be required by the
Delaware Act) of the Partnership's Partners (which for this purpose
shall include (A) the EBRD so long as the EBRD owns any Interest in
the Partnership, (B) DEG so long as DEG continues to own at least
the lesser of (x) ten percent (10%) of the aggregate number of
Interests in the Partnership and the Other Fund Entities or (y) 11.3
Interests, (C) the Pittsburgh Representative (acting on behalf of
the Limited Partners comprising the Pittsburgh Group) so long as the
Pittsburgh Group continues to own at least 10.5 Interests and (D) a
former General Partner which will become a Limited Partner by
operation of Section 4.09 if a new General Partner is appointed),
elect to continue the Partnership and the Partnership business and
consent to the appointment, effective as of the date of the event
specified in Section 7.01(a)(ii) hereof, of one or more additional
general partners of the Partnership, if necessary or desired.
(c) Dissolution of the Partnership shall be effective on the day on
which the event occurs giving rise to the dissolution, but the
Partnership shall not terminate until the Partnership's Certificate
of Limited Partnership shall have been cancelled and the assets of
the Partnership shall have been distributed as provided herein.
Notwithstanding the dissolution of the Partnership, prior to the
termination of the Partnership, as aforesaid, the business of the
Partnership and the affairs of the Partners, as such, shall continue
to be governed by this Agreement. Upon dissolution, the General
Partner or a liquidator appointed by a Majority-in-Interest of the
Partnership's Partners, shall liquidate and distribute the assets of
the Partnership, apply and distribute the proceeds of any sale
thereof as contemplated by this Agreement and cause the cancellation
of the Partnership's Certificate of Limited Partnership.
7.02 Distributions Upon Liquidation.
(a) After payment of liabilities owing to creditors, the General Partner
or liquidator shall set up such reserves as it deems reasonably
necessary for any contingent or unforeseen liabilities or
obligations of the Partnership, including the expenses of
liquidation. Such reserves may be paid over by the General Partner
or liquidator to a bank, to be held in escrow for the purpose of
paying any such contingent or unforeseen
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liabilities or obligations and, at the expiration of such period as
the General Partner or liquidator may deem advisable, such reserves
shall be distributed to the Partners or their assigns in the manner
set forth below in Section 7.02(b). After paying such liabilities
and providing for such reserves, the General Partner or liquidator
shall cause the remaining net assets of the Partnership to be
distributed to and among the Partners in the manner set forth below
in Section 7.02(b). In the event that any part of such net assets
consists of securities or other non-cash assets, the General Partner
or liquidator shall, unless a distribution of such assets is
approved as set forth in Section 4.02(c)(ii) above, take such steps
as it deems appropriate to convert such assets into cash.
(b) After payment or provision for all liabilities of the Partnership
pursuant to Section 7.02(a), and the allocation of Net Profits and
Net Losses pursuant to Sections 2.03 through 2.06 (including any
deemed Net Profits or Net Losses attributable to assets to be
distributed to the Partners in-kind in accordance with Section
2.03(b) or otherwise pursuant to Sections 2.04 and 2.05), the
General Partner shall distribute the remaining Partnership assets to
the Partners in accordance with their respective positive Capital
Account balances. For the purposes of this Section 7.02 (subject to
paragraph (a) above), an asset distributed to a Partner in kind
shall be considered as a distribution in the amount of the asset's
fair market value (net of liabilities secured by such asset that the
Partner is considered to assume or take subject to or under Code
Section 752).
(c) The General Partner shall be obligated to make the following
contributions to the capital of the Partnership in addition to the
contributions referred to under Section 2.01(k) hereof:
(i) Upon dissolution of the Partnership, after any allocation of
Net Profits or Net Losses pursuant to Sections 2.04 and 2.05
hereof and the initial distributions to the Partners pursuant
to Section 7.02(b) hereof, the General Partner shall
contribute to the capital of the Partnership an amount equal
to the lesser of (x) its negative Capital Account balance, if
any, and (y) the excess of (A) 1.01% of the total capital
contributions of the Limited Partners over (B) the aggregate
amount
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of capital previously contributed to the Partnership by the
General Partner. Such amount shall be treated as additional
liquidation proceeds subject to Section 7.02 hereof.
(ii) In addition, upon the liquidation of the Interest of a General
Partner other than pursuant to a dissolution of the
Partnership, the General Partner whose Interest is liquidated
shall contribute to the Partnership the amount such General
Partner would have been obligated to contribute pursuant to
clause (i) above, had the Partnership dissolved at the time of
the liquidation of the General Partner's Interest.
8. MISCELLANEOUS
8.01 Notices.
Any and all notices, elections or demands permitted or required to be made
under this Agreement shall be in writing, signed by the Partner giving
such notice, election or demand and shall be delivered personally, or sent
by registered or certified mail or international courier company (such as
Federal Express), to the other Partner or Partners, at his record address
on the books of the Partnership or at such other address as may be
supplied by written notice given in conformity with the terms of this
Section 8.01. The date of personal delivery or the date of mailing, as the
case may be, shall be the date of such notice.
8.02 Successors and Assigns.
Subject to the restrictions on transfers set forth herein, this Agreement,
and each and every provision hereof, shall be binding upon and shall inure
to the benefit of the Partners, their respective successors,
successors-in-title, heirs and assigns, and each and every
successor-in-interest to any Partner, whether such successor acquires such
interest by way of gift, purchase, foreclosure or by any other method,
shall hold such interest subject to all of the terms and provisions of
this Agreement.
-49-
50
8.03 Power of Attorney.
Each Limited Partner and any additional or substituted Limited Partner, by
the execution of this Agreement or any counterpart thereof by its
attorney-in-fact, does hereby irrevocably constitute and appoint the
General Partner, and any person or entity which becomes a substitute or
additional General Partner, and each of them acting alone in each case
with full power of substitution, such Limited Partner's true and lawful
agent and attorney-in-fact, with full power and authority in such Limited
Partner's name, place and stead, to make, execute, acknowledge, swear to,
deliver, file and record such documents and instruments as may be
necessary or appropriate to carry out the provisions of this Agreement,
including, but not limited to, (a) such amendments to this Agreement and
the Partnership's Certificate of Limited Partnership, as amended from time
to time, as are necessary to effectuate the provisions of Sections 4.10 or
8.04 of this Agreement or to admit additional or substituted Limited
Partners or additional or substituted General Partner(s) to the
Partnership pursuant to Section 2.01, Section 6.01 or Section 6.02 or to
effectuate the withdrawal of any General Partner or Limited Partner
pursuant to Section 6.01 or Section 6.02; (b) such documents and
instruments as are necessary to cancel the Partnership's Certificate of
Limited Partnership pursuant to Section 7.01 and (c) all other instruments
which may be required or permitted to be filed on behalf of the
Partnership. The foregoing power of attorney, being coupled with an
interest, is hereby declared to be irrevocable. This Power of Attorney
shall survive the death, dissolution or incapacity of any Limited Partner
and the assignment by any Limited Partner of such Limited Partner's
Interest in the Partnership.
8.04 Amendment.
In addition to any amendments otherwise authorized herein, amendments may
be made to this Agreement from time to time in any of the following
manners:
(a) By a writing executed by a Majority-in-Interest of the Partners;
provided, however, that (i) any amendment which would increase the
liability of a Limited Partner to the Partnership, amend Section
2.01, 2.03, 2.04 (except as provided in clause (b) below), 2.05,
3.01, 6.01, 7.01, 7.02 or this Section 8.04(a) may be made only by a
writing executed by all of the Partners affected thereby; (ii)
Section 4.02(c) may only be
-50-
51
amended with the consent of the applicable
Super-Majority-in-Interest of the Fund's Partners; (iii) Sections
1.03(b) and 4.12 may only be amended with the consent of the EBRD
(if the EBRD then has special approval rights pursuant thereto);
(iv) Sections 1.03(b) and 4.13 may only be amended with the consent
of DEG (if DEG then has special approval rights pursuant thereto);
(v) Sections 1.03(b) and 4.14 may only be amended with the consent
of the Pittsburgh Representative (if the Pittsburgh Representative
then has special approval rights pursuant thereto); and (vi) no
amendment may be made to this Agreement (other than amendments with
respect to matters which are applicable to the Partnership and the
Partners hereof because of laws, rules and regulations applicable to
the Partnership and its Partners which are not so applicable to the
Other Fund Entities or the partners thereof (including the Delaware
Act and the Code, or any portions thereof) (any such amendment being
hereinafter referred to as a "U.S. - Specific Amendment")) unless a
similar amendment has been made to the partnership agreements of the
Other Fund Entities. Further, the Partners agree to amend this
Agreement as directed by a Majority-in-Interest of the Fund's
Partners; provided, that similar amendments have been made to the
partnership agreements of the Other Fund Entities and that the
required amendment does not contravene Delaware law.
(b) By the General Partner, without the consent or approval of the
Limited Partners, to amend appropriate provisions of this Agreement
if the Partnership is advised at any time by its legal counsel that
the allocations of Net Profits and Losses provided in Section 2.04
hereof are unlikely to be respected for federal income tax purposes,
either because of the promulgation and adoption of Treasury
regulations under Code Section 704 or other developments in
applicable law. In making any such amendment, the General Partner
shall use its best efforts to effect as little change in the
economic and tax arrangements among the Partners as it shall
determine in its sole discretion to be necessary to provide for
allocations of profits and losses to the Limited Partners which it
believes will be respected for federal income tax purposes. Any
amendments made by the General Partner pursuant to this subsection
8.04(b) shall be deemed to be made pursuant to the fiduciary
obligations of the General Partner to the Partnership and to the
Limited Partners, and no such amendment shall
-51-
52
give rise to any claim or cause of action by any Limited Partner.
8.05 No Waiver.
The failure of any Partner to insist upon strict performance of a covenant
hereunder or of any obligation hereunder, irrespective of the length of
time for which such failure continues, shall not be a waiver of such
Partner's right to demand strict compliance in the future. No consent or
waiver, express or implied, to or of any breach or default in the
performance of any obligation hereunder, shall constitute a consent or
waiver to or of any other breach or default in the performance of the same
or any other obligation hereunder.
8.06 Creditors.
None of the provisions of this Agreement shall be for the benefit of or
enforceable by any creditor of any Partner or of the Partnership other
than a Partner who is a creditor of the Partnership pursuant to the terms
of this Agreement.
8.07 Entire Agreement.
This Agreement constitutes the full and complete agreement of the parties
hereto with respect to the subject matter hereof and supersedes any prior
written or oral agreements among the parties with respect to such subject
matter.
8.08 Captions.
Titles or captions of Articles or Sections contained in this Agreement are
inserted only as a matter of convenience and for reference, and in no way
define, limit, extend or describe the scope of this Agreement or the
intent of any provision hereof.
8.09 Counterparts.
This Agreement may be executed in a number of counterparts, all of which
together shall for all purposes constitute one Agreement, binding on all
the Partners, notwithstanding that all Partners have not signed the same
counterpart.
-52-
53
8.10 Severability.
The invalidity or unenforceability of any provision of this Agreement
shall not affect the validity or enforceability of any other provision.
8.11 Applicable Law.
This Agreement and the rights and obligations of the parties hereunder
shall be governed by, and interpreted, construed and enforced in
accordance with, the laws of the State of Delaware.
8.12 Arbitration.
(a) Any dispute, controversy or claim arising out of or relating to this
Agreement, or the breach, termination or invalidity thereof, shall
be referred to and finally resolved by arbitration administered by
the London Court of International Arbitration in accordance with the
UNCITRAL Arbitration Rules as in force and effect on the date of
this Agreement. Any dispute shall be submitted to an arbitral
tribunal of one arbitrator appointed by the London Court of
International Arbitration which shall, regardless of the number of
parties to such dispute, be empowered to act as the appointing
authority for such purposes. The place of arbitration shall be
London, England, and the English language shall be used throughout
the arbitral proceedings. Without prejudice to the rights of the
EBRD set out in paragraph (c) of this Section, the General Partner
and the Limited Partners agree that the jurisdiction of any court or
other judicial authority to rule on a question of law affecting the
arbitration or to hear any appeal from or entertain any judicial
review of the arbitral award is hereby ousted. The General Partner
and the Limited Partners agree that any award of the arbitrator may
be enforced in the courts of England.
(b) The arbitral tribunal shall have authority to consider and include
in any proceeding, decision or award, any dispute properly brought
before it by any party to this Agreement insofar as such dispute
arises out of this Agreement, but subject to the foregoing no other
parties or other disputes shall be included in, or consolidated
with, the arbitral proceedings.
-53-
54
(c) Nothing in this Section shall be construed as a waiver, renunciation
or other modification of the privileges, immunities and exemptions
of the EBRD accorded under the Agreement Establishing the European
Bank for Reconstruction and Development dated May 29, 1990,
international convention or any applicable laws.
8.13 Partition.
The Partners hereby agree that no Partner nor any successor-in-interest to
any Partner, shall have the right while this Agreement remains in effect
to have the property of the Partnership partitioned, or to file a
complaint or institute any proceeding at law or in equity to have the
property of the Partnership partitioned, and each Partner, on such
Partner's own behalf, and on behalf of such Partner's successors,
representatives, heirs, and assigns, hereby waives any such right. It is
the intention of the Partners that during the term of this Agreement, the
rights of the Partners and their successors-in-interest, as among
themselves, shall be governed by the terms of this Agreement, and that the
right of any Partner or successor-in-interest to assign, transfer, sell or
otherwise dispose of such Partner's interest in the property of the
Partnership shall be subject to the limitations and restrictions of this
Agreement.
8.14 Gender, Etc.
In the case of all terms used in this Agreement, the singular shall
include the plural and the masculine gender shall include the feminine and
neuter, and vice versa, as the context requires.
8.15 Definitions.
The definitions of the terms used in this Agreement as set forth in the
Sections of this Agreement are listed below:
Term Section
---- -------
"Administrator" 4.12(c)
"Advisor" 1.03
"affiliate" 4.05
"Capital Account" 2.03(a)
"Carrying Value" 2.02(a)
"Code" 2.02(b)
"Commitment Termination Date" 2.01(b)
"control" 4.05
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"Defaulting Partner" 2.01(c)
"DEG" 1.03(b)
"Delaware Act" 1.02
"Distributable Cash" 3.01(a)
"Drawndown Capital" 2.01(b)
"EBRD" 1.03(a)
"Excess Negative Balance" 2.02(c)
"First Installment of
Subscribed Capital" 2.01(a)
"Fiscal Period" 2.02(d)
"Fourth Installment Notice" 2.01(c)
"Fourth Installment of
Subscribed Capital" 2.01(c)
"Fund" 1.03
"Fund Documents" 4.12(c)
"GAAP" 5.03(a)
"General Partner(s)" Description of Parties
"Indemnified Party" 4.06(a)
"Interest(s)" 2.01(a)
"Investment Company Act" 2.01(i)
"Investment Objective" 1.03
"Investment Policies" 1.03
"Investment Restrictions" 4.02(b)
"Joint Management Agreement" 1.03
"LP Purchaser" 2.01(d)
"Limited Partner" Description of Parties
"Majority-in-Interest of the
Fund's Partners" 4.02(b)
"Majority-in-Interest of the
Partnership's Partners" 4.09(b)
"Manager" 1.03
"Memorandum" 1.03
"Negligence" 4.06(a)
"Net Asset Value" 2.01(i)
"Net Losses" 2.02(b)
"Net Profits" 2.02(b)
"Non-Defaulting Partner" 2.01(d)
"Other Fund Entities" 1.03
"Oversight Board" 1.03(b)
"Partners" 1.06(b)
"Partnership" Description of Parties
"Pittsburgh Group" 1.03(b)
"Pittsburgh Representative" 1.03(b)
"Polish Issuers" 1.03(a)
"Second Installment Notice" 2.01(b)
"Second Installment of
Subscribed Capital" 2.01(b)
"Securities Act" 2.01(i)
"Subscribed Capital" 2.01(a)
-55-
56
"Super-Majority-in-Interest
of the Fund's Partners" 4.02(c)
"10% in interest of the
Partnership's Limited
Partners" 4.11(a)
"Third Installment Notice" 2.01(b)
"Third Installment of
Subscribed Capital" 2.01(b)
"Total Drawndown Capital" 2.01(b)
"transfer" 6.01(a)
"U.S.-Specific Amendment" 8.01(a)
8.16 Covenant to Maintain Net Worth.
The General Partner hereby covenants and agrees that it shall at all times
use its reasonable best efforts to maintain net worth sufficient to
satisfy any and all net worth requirements set forth in the Code and
regulations and rulings thereunder for general partners of a limited
partnership in order for the Partnership to maintain its classification as
a limited partnership under the Code.
-56-
57
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
20th day of January, 1995.
GENERAL PARTNER:
Pioneer Poland U.S. (Jersey) Limited
By: /s/ Xxxxx A. N. Xxxxxx
---------------------------------
Xxxxx A. N. Xxxxxx, Director
WITHDRAWING INITIAL LIMITED PARTNER:
Pioneer Poland U.K. (Jersey) Limited
By: /s/ Xxxxx A. N. Xxxxxx
---------------------------------
Xxxxx A. N. Xxxxxx, Director
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58
ADDITIONAL LIMITED PARTNERS:
Those persons named as limited partners
on Schedule A hereto
By: Pioneer Poland U.S. (Jersey)
Limited, as their attorney-in-fact
pursuant to the provisions of their
Subscription Agreements:
By: /s/ Xxxxx A. N. Xxxxxx
---------------------------------
Xxxxx A. N. Xxxxxx, Director
AND
By: Pioneering Management (Jersey)
Limited, as their attorney-in-fact
pursuant to the provisions of their
Subscription Agreements:
By: /s/ Xxxxx A. N. Xxxxxx
---------------------------------
Xxxxx A. N. Xxxxxx, Director
-58-
59
SCHEDULE A
GENERAL PARTNER
Number Aggregate
Name and Address of Units Subscribed Capital
---------------- -------- ------------------
Pioneer Poland U.S. 5 $2,425,000
(Jersey) Limited
XxXxxxx Xxxxxxxx
Xx. Xxxxxx
Xxxxxx, Xxxxxxx Xxxxxxx
XX0 0XX
LIMITED PARTNERS
Number Aggregate
Name and Address of Units Subscribed Capital
---------------- -------- ------------------
European Bank for 10.06 $4,879,100
Reconstruction and
Development
Xxx Xxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Xxxxxxx
DEG - Deutsche Investitions- 6.707 $3,252,895
und Entwicklungsgesellschaft
mbH
Xxxxxxxxxxxxxxxx 00
Koln (Mungersdorf)
Germany
Lyndhurst Associates 6 $2,910,000
000 Xxxxxxxxx Xxxxxx
000 Xxxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
Carnegie Mellon University 4 $1,940,000
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
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60
Xxxxxxx Global Fund, Inc. 3 $1,455,000
on behalf of
Xxxxxxx Global Small Company
Fund, Inc.
Xxxxxxx, Xxxxxxx & Xxxxx, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
The Mayo Foundation Global 2.8 $1,358,000
Small Company Account
Xxxxxxx, Xxxxxxx & Xxxxx, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
The Mayo Foundation Pension 1.2 $582,000
Trust Global Small Company
Account
Xxxxxxx, Xxxxxxx & Xxxxx, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Xxxxx X. Xxxxxxxx .5 $242,500
c/o Federated Investment
Counselling
Federated Investors Tower
Xxxxxxxxxx, XX 00000-0000
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61
AMENDMENT TO AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
OF PIONEER POLAND, U.S., L.P.
This amendment (the "Amendment") to the Amended and Restated Limited
Partnership Agreement, dated as of January 20, 1995, of Pioneer Poland U.S.,
L.P. (the "Agreement") is made, pursuant to Section 8.04 of the Agreement, as of
the 18th Day of July, 1995.
The Agreement is hereby amended by adding the following new Section 4.15
immediately after Section 4.14 of the Agreement:
4.15 Commerzbank AG
The Limited Partners agree to vote for a designee of Commerzbank AG
as one of the Limited Partners' representatives on the Oversight
Board designated pursuant to the Joint Management Agreement;
provided, that such voting agreement will not apply at any time that
Commerzbank AG owns less than 20.618 Interests in the Partnership
and the Other Fund Entities.
The Amendment shall become effective as of the 18th day of July, 1995 upon
its execution by a Majority-in-Interest of the Partnership's Partners (as such
term is defined in section 4.09(b) of the Agreement).
EXECUTED as of the 19th day of July, 1995.
EUROPEAN BANK
-----------------------------------------
Print Name of Partner
By: /s/ [signature]
----------------------------------
Authorized Officer of Partner
ATTEST:
/s/ X.X. Xxxxxx
-----------------------------------
62
AMENDMENT TO AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
OF PIONEER POLAND, U.S., L.P.
This amendment (the "Amendment") to the Amended and Restated Limited
Partnership Agreement, dated as of January 20, 1995, of Pioneer Poland U.S.,
L.P. (the "Agreement") is made, pursuant to Section 8.04 of the Agreement, as of
the 18th Day of July, 1995.
The Agreement is hereby amended by adding the following new Section 4.15
immediately after Section 4.14 of the Agreement:
4.15 Commerzbank AG
The Limited Partners agree to vote for a designee of Commerzbank AG
as one of the Limited Partners' representatives on the Oversight
Board designated pursuant to the Joint Management Agreement;
provided, that such voting agreement will not apply at any time that
Commerzbank AG owns less than 20.618 Interests in the Partnership
and the Other Fund Entities.
The Amendment shall become effective as of the 18th day of July, 1995 upon
its execution by a Majority-in-Interest of the Partnership's Partners (as such
term is defined in Section 4.09(b) of the Agreement).
EXECUTED as of the 19th day of July, 1995.
DEG - DEUTSCHE INVESTITIONS-UND
ENTWICKLUNGSGESELLSCHAFT MBH.
-----------------------------------------
Print Name of Partner
By: /s/ [signature]
---------------------------------- /s/ [signature]
Authorized Officer of Partner ------------------------
ATTEST:
-----------------------------------
63
AMENDMENT TO AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
OF PIONEER POLAND, U.S., L.P.
This amendment (the "Amendment") to the Amended and Restated Limited
Partnership Agreement, dated as of January 20, 1995, of Pioneer Poland U.S.,
L.P. (the "Agreement") is made, pursuant to Section 8.04 of the Agreement, as of
the 18th day of July, 1995.
The Agreement is hereby amended by adding the following new Section 4.15
immediately after Section 4.14 of the Agreement:
4.15 Commerzbank AG
The Limited Partners agree to vote for a designee of Commerzbank AG
as one of the Limited Partners' representatives on the Oversight
Board designated pursuant to the Joint Management Agreement;
provided, that such voting agreement will not apply at any time that
Commerzbank AG owns less than 20.618 Interests in the Partnership
and the Other Fund Entities.
The Amendment shall become effective as of the 18th day of July, 1995 upon
its execution by a Majority-in-Interest of the Partnership's Partners (as such
term is defined in Section 4.09(b) of the Agreement).
EXECUTED as of the 19th day of July, 1995.
MELLON BANK, N.A., AS TRUSTEE FOR THE CARNEGIE MELLON
UNIVERSITY TRUST (as directed by Carnegie Mellon University)
------------------------------------------------------------
Print Name of Partner
By: /s/ Xxxx X. XxXxxx
------------------------------
Authorized Officer of Partner
Xxxx X. XxXxxx, Vice President
ATTEST:
/s/ [signature]
----------------------------------
[LEGAL DEPARTMENT SEAL]
64
AMENDMENT TO AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
OF PIONEER POLAND, U.S., L.P.
This amendment (the "Amendment") to the Amended and Restated Limited
Partnership Agreement, dated as of January 20, 1995, of Pioneer Poland U.S.,
L.P. (the "Agreement") is made, pursuant to Section 8.04 of the Agreement, as of
the 18th day of July, 1995.
The Agreement is hereby amended by adding the following new Section 4.15
immediately after Section 4.14 of the Agreement:
4.15 Commerzbank AG
The Limited Partners agree to vote for a designee of Commerzbank AG
as one of the Limited Partners' representatives on the Oversight
Board designated pursuant to the Joint Management Agreement;
provided, that such voting agreement will not apply at any time that
Commerzbank AG owns less than 20.618 Interests in the Partnership
and the Other Fund Entities.
The Amendment shall become effective as of the 18th day of July, 1995 upon
its execution by a Majority-in-Interest of the Partnership's Partners (as such
term is defined in Section 4.09(b) of the Agreement).
EXECUTED as of the 19th day of July, 1995.
Lyndhurst Associates
--------------------------------------------------
Print Name of Partner
By: /s/ Xxxxx Xxxxxx, Managing Partner
------------------------------------
Authorized Officer of Partner
ATTEST:
/s/ Xxxxxxxx X. Xxxx
--------------------------------------
65
AMENDMENT TO AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
OF PIONEER POLAND, U.S., L.P.
This amendment (the "Amendment") to the Amended and Restated Limited
Partnership Agreement, dated as of January 20, 1995, of Pioneer Poland U.S.,
L.P. (the "Agreement") is made, pursuant to Section 8.04 of the Agreement, as of
the 18th day of July, 1995.
The Agreement is hereby amended by adding the following new Section 4.15
immediately after Section 4.14 of the Agreement:
4.15 Commerzbank AG
The Limited Partners agree to vote for a designee of Commerzbank AG
as one of the Limited Partners' representatives on the Oversight
Board designated pursuant to the Joint Management Agreement;
provided, that such voting agreement will not apply at any time that
Commerzbank AG owns less than 20.618 Interests in the Partnership
and the Other Fund Entities.
The Amendment shall become effective as of the 18th day of July, 1995 upon
its execution by a Majority-in-Interest of the Partnership's Partners (as such
term is defined in Section 4.09(b) of the Agreement).
EXECUTED as of the 18th day of July, 1995.
Xxxxx X. Xxxxxxxx
------------------------------------------------
Print Name of Partner
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------
Authorized Officer of Partner
ATTEST:
/s/ Xxxxxxxxx Xxxxxxxx
-----------------------------------------
66
AMENDMENT TO LIMITED PARTNERSHIP AGREEMENT
OF
PIONEER POLAND U.S., L.P.
Pursuant to authority duly conferred on the undersigned general partner
(the "General Partner") by Section 2.01(m) of the Amended and Restated Limited
Partnership Agreement of Pioneer Poland U.S., L.P. (the "U.S. Partnership"),
dated as of January 20, 1995 and further amended as of July 18, 1995 (the "U.S.
Partnership Agreement"), the General Partner hereby amends Schedule A to the
U.S. Partnership Agreement by replacing the existing Schedule A to such
agreement with the schedule attached hereto, and thereby reflecting the purchase
of additional Interests of the U.S. Partnership by the European Bank for
Reconstruction and Development and DEG - Deutsche Investitions-und
Entwicklungsgesellschaft mbH.
This amendment is effective as of July 18, 1995, and, in accordance with
Section 2.01(m) of the U.S. Partnership Agreement, is deemed to be a part of the
U.S. Partnership Agreement and is incorporated therein.
IN WITNESS WHEREOF, the General Partner has executed this amendment on the
18th day of October, 1995.
PIONEER POLAND U.S. (JERSEY) LIMITED
By: /s/ X. X. Xxxxxx
---------------------------------
, Director
ATTEST:
/s/ Xxxxx Xxxxx
------------------------------------
67
SCHEDULE A
GENERAL PARTNER
Number of Aggregate
Name and Address Interests Subscribed Capital
---------------- --------- ------------------
Pioneer Poland U.S. 5 $2,425,000
(Jersey) Limited
Xxxxxxxx Xxxxxxxx
Xx. Xxxxxx
Xxxxxx, Xxxxxxx Xxxxxxx
XX0 0XX
LIMITED PARTNERS
Number of Aggregate
Name and Address Interests Subscribed Capital
---------------- --------- ------------------
European Bank for 14.984 $7,267,240
Reconstruction and
Development
Xxx Xxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Xxxxxxx
DEG - Deutsche Investitions- 9.9892 $4,844,762
und Entwicklungsgesellschaft
mbH
Xxxxxxxxxxxxxxxx 00
Koln (Mungersdorf)
Germany
Lyndhurst Associates 6 $2,910,000
000 Xxxxxxxxx Xxxxxx
000 Xxxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
Carnegie Mellon University 4 $1,940,000
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
68
Xxxxxxx Global Fund, Inc. 3 $1,455,000
on behalf of
Xxxxxxx Global Small Company
Fund, Inc.
Xxxxxxx, Xxxxxxx & Xxxxx, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
The Mayo Foundation Global 2.8 $1,358,000
Small Company Account
Xxxxxxx, Xxxxxxx & Xxxxx, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
The Mayo Foundation Pension 1.2 $ 582,000
Trust Global Small Company
Account
Xxxxxxx, Xxxxxxx & Xxxxx, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Xxxxx X. Xxxxxxxx .5 $ 242,500
c/o Federated Investment
Counselling
Federated Investors Tower
Xxxxxxxxxx, XX 00000-0000
Total
Total Limited
Limited Partner
Partner Subscribed
Interests = 42.4732 Capital = $20,599,502
------- -----------
Total
Total General
General Partner
Partner Subscribed
Interests = 5.0 Capital = $ 2,425,000
--- -----------
Total
Subscribed
Total Interests = 47.4732 Capital = $23,024,502
------- -----------
69
AMENDMENT TO AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
OF PIONEER POLAND, U.S., L.P.
This amendment (the "Amendment") to the Amended and Restated Limited
Partnership Agreement, dated as of January 20, 1995 and amended as of July 18,
1995, of Pioneer Poland U.S., L.P. (the "Agreement") is made, pursuant to
Section 8.04(a) of the Agreement, as of the 15th day of September, 1995.
The Agreement is hereby amended:
1. By deleting the word "and" from the tenth line of Section 1.03(b)
and inserting the following words immediately after the words "the
consent of the Pittsburgh Group required hereby)" contained in such
Section:
, (iv) only with respect to actions described in clause (w) below,
Commerzbank AG so long as Commerzbank AG continues to own at least
20.618 Interests in the Partnership and the Other Fund Entities, and
(v) only with respect to actions described in clause (w) below, the
State of Wisconsin Investment Board ("SWIB") so long as SWIB
continues to own at least 20.618 Interests in the Partnership and
the Other Fund Entities
2. By adding the following new Section 4.16 immediately after Section
4.15 of the Agreement:
4.16 State of Wisconsin Investment Board
(a) The Limited Partners agree to vote for a designee of SWIB as
one of the Limited Partners' representatives on the Oversight
Board designated pursuant to the Joint Management Agreement;
provided, that such voting agreement will not apply at any
time that SWIB owns less than 20.618 Interests in the
Partnership and the Other Fund Entities.
(b) SWIB agrees that it will always act without unreasonable delay
in connection with any consent or approval being requested of
it under this Agreement or any Fund Document which requires or
provides for the consent or approval of SWIB or
70
Amendment to Amended and Restated
Limited Partnership Agreement of
Pioneer Poland U.S., L.P.
September 15, 1995
Page 2
SWIB's representative on the Oversight Board in certain
circumstances.
3. By deleting the word "and" from the tenth line of Section 6.02(e)
and inserting the following words immediately after the words "to
own at least 10.5 Interests" contained in such Section:
, and (D) SWIB so long as SWIB continues to own at least 20.618
Interests
4. By (A) redesignating "(vi)" contained in Section 8.04(a) as "(viii)"
and (B) inserting the following words immediately after the words
"then has special approval rights pursuant thereto);" contained in
Section 8.04(a):
(vi) Sections 1.03(b) and 4.15 may only be amended with the consent
of Commerzbank AG (if Commerzbank AG then has special approval
rights pursuant Sections 1.03(b) and 4.15 of the Limited Partnership
Agreement of Pioneer Poland UK L.P.) unless the amendment does not
affect a right granted to Commerzbank AG; (vii) Sections 1.03(b),
4.16 and 6.02(e) may only be amended with the consent of SWIB (if
SWIB then has special approval rights pursuant thereto) unless the
amendment does not affect a right granted to SWIB;
5. By inserting the following words immediately after the words
""Super-Majority-in-Interest of the Fund's Partners" 4.02(c)"
contained in Section 8.15:
"SWIB" 1.03(b)
The Amendment shall become effective as of the 15th day of September, 1995
upon its execution by that number of the Partnership's Partners which is
required by the terms of the Agreement (including those particular Partners
whose approval is required) to give effect to the Amendment.
71
Amendment to Amended and Restated
Limited Partnership Agreement of
Pioneer Poland U.S., L.P.
September 15, 1995
Page 3
EXECUTED as of the 16 day of October, 1995.
PIONEER POLAND U.S. (JERSEY) LIMITED
-------------------------------------
Print Name of Partner
By: /s/ X. X. Xxxxxx
----------------------------------
Authorized Officer of Partner
ATTEST:_________________________
72
Amendment to Amended and Restated
Limited Partnership Agreement of
Pioneer Poland U.S., L.P.
September 15, 1995
Page 3
EXECUTED as of the 20th day of September, 1995.
EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT
------------------------------------------------
Print Name of Partner (of U.S. Partnership)
By: /s/ Xxx Xx Xxxxxxxx
------------------------------------------------
Authorized Officer of Partner
XXX XX XXXXXXXX (DEPUTY VICE PRESIDENT)
EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT
ATTEST:______________________________________
73
Amendment to Amended and Restated
Limited Partnership Agreement of
Pioneer Poland U.S., L.P.
September 15, 1995
Page 3
EXECUTED as of the 20 day of September, 1995.
DEG-Deutsche Investitions-und
Entwicklungsgesellschaft mbH
-------------------------------------------
Print Name of Partner
By: /s/ [signature]
----------------------------------------
Authorized Officer of Partner
ATTEST: /s/ [signature]
------------------------------------
74
Amendment to Amended and Restated
Limited Partnership Agreement of
Pioneer Poland U.S., L.P.
September 15, 1995
Page 3
EXECUTED as of the 19th day of September, 1995.
MELLON BANK, N.A., AS TRUSTEE UNDER DEED OF TRUST OF
CARNEGIE MELLON UNIVERSITY (as directed by Carnegie Mellon
University)
-----------------------------------------------------------
Print Name of Partner (of U.S. Partnership)
By: /s/ [signature]
--------------------------------------------------------
Authorized Officer of Partner
ATTEST: /s/ [signature]
----------------------------------------------
[SEAL]
75
Amendment to Amended and Restated
Limited Partnership Agreement of
Pioneer Poland U.S., L.P.
September 15, 1995
Page 3
EXECUTED as of the 14th day of September, 1995.
LYNDHURST ASSOCIATES
-------------------------------------------
Print Name of Partner (of U.S. Partnership)
By: /s/ Xxxxx Xxxxxx
----------------------------------------
Authorized Officer of Partner
ATTEST: /s/ [signature]
-----------------------------
76
Amendment to Amended and Restated
Limited Partnership Agreement of
Pioneer Poland U.S., L.P.
September 15, 1995
Page 3
EXECUTED as of the 20th day of September, 1995.
Xxxxx X. Xxxxxxxx
-------------------------------------------
Print Name of Partner (of U.S. Partnership)
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------------
Authorized Officer of Partner
ATTEST: /s/ Xxxxxx X. Xxxxxx
----------------------------------
77
Amendment to Amended and Restated
Limited Partnership Agreement of
Pioneer Poland U.S., L.P.
September 15, 1995
Page 3
EXECUTED as of the 19 day of September, 1995.
Xxxxxxx Global Fund Inc. on behalf of
Xxxxxxx Global Small Company Fund
-------------------------------------------
Print Name of Partner (of U.S. Partnership)
By: /s/ [signature]
----------------------------------------
Authorized Officer of Partner
ATTEST:________________________________
78
Amendment to Amended and Restated
Limited Partnership Agreement of
Pioneer Poland U.S., L.P.
September 15, 1995
Page 3
EXECUTED as of the 21st day of September, 1995.
Mayo Foundation (Xxxxxxx Global Small Company Account)
---------------------------------------------
Print Name of Partner (of U.S. Partnership)
By: /s/ [signature]
------------------------------------------
Authorized Officer of Partner
ATTEST:_____________________________________
79
Amendment to Amended and Restated
Limited Partnership Agreement of
Pioneer Poland U.S., L.P.
September 15, 1995
Page 3
EXECUTED as of the 21st day of September, 1995.
Mayo Foundation Pension Plan
---------------------------------------------
Print Name of Partner (of U.S. Partnership)
By: /s/ [signature]
-----------------------------------------
Authorized Officer of Partner
ATTEST:_____________________________
80
AMENDMENT TO LIMITED PARTNERSHIP AGREEMENT
OF
PIONEER POLAND U.S., L.P.
Pursuant to authority duly conferred on the undersigned general partner
(the "General Partner") by Section 2.01(m) of the Amended and Restated Limited
Partnership Agreement of Pioneer Poland U.S., L.P. (the "U.S. Partnership"),
dated as of January 20, 1995 and further amended as of July 18, 1995 and
September 15, 1995 (the "U.S. Partnership Agreement"), the General Partner
hereby amends Schedule A to the U.S. Partnership Agreement by replacing the
existing Schedule A to such agreement with the schedule attached hereto, and
thereby reflecting the admission of State of Wisconsin Investment Board as a
limited partner of the U.S. Partnership and the purchase of additional Interests
of the U.S. Partnership by the European Bank for Reconstruction and Development
and DEG - Deutsche Investitions- und Entwicklungsgesellschaft mbH.
This amendment is effective as of October 18, 1995, and, in accordance
with Section 2.01(m) of the U.S. Partnership Agreement, is deemed to be a part
of the U.S. Partnership Agreement and is incorporated therein.
IN WITNESS WHEREOF, the General Partner has executed this amendment on the
18th day of October, 1995.
PIONEER POLAND U.S. (JERSEY) LIMITED
By: /s/ X. X. Xxxxxx
-----------------------------------
, Director
ATTEST:
/s/ Xxxxx Xxxxx
--------------------------------------
81
SCHEDULE A
GENERAL PARTNER
---------------
Number of Aggregate
Name and Address Interests Subscribed Capital
---------------- --------- -------------------
Pioneer Poland U.S. 5 $2,425,000
(Jersey) Limited
XxXxxxx Xxxxxxxx
Xx. Xxxxxx
Xxxxxx, Xxxxxxx Xxxxxxx
XX0 0XX
LIMITED PARTNERS
----------------
Number of Aggregate
Name and Address Interests Subscribed Capital
---------------- --------- -------------------
European Bank for 15 $7,275,000
Reconstruction and
Development
Xxx Xxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Xxxxxxx
DEG -- Deutsche Investitions- 11.3 $5,480,500
und Entwicklungsgesellschaft
mbH
Xxxxxxxxxxxxxxxx 00
Xxxx (Xxxxxxxxxxx)
Xxxxxxx
State of Wisconsin 20.618 $9,999,730
Investment Board
X.X. Xxx 0000
Xxxxxxx, XX 00000
Lyndhurst Associates 6 $2,910,000
000 Xxxxxxxxx Xxxxxx
000 Xxxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
Carnegie Mellon University 4 $1,940,000
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
82
Xxxxxxx Global Fund, Inc. 3 $1,455,000
on behalf of
Xxxxxxx Global Small Company
Fund, Inc.
Xxxxxxx, Xxxxxxx & Xxxxx, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
The Mayo Foundation Global 2.8 $1,358,000
Small Company Account
Xxxxxxx, Xxxxxxx & Xxxxx, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
The Mayo Foundation Pension 1.2 $ 582,000
Trust Global Small Company
Account
Xxxxxxx, Xxxxxxx & Xxxxx, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Xxxxx X. Xxxxxxxx .5 $ 242,500
c/o Federated Investment
Counselling
Federated Investors Tower
Xxxxxxxxxx, XX 00000-0000
Total
Total Limited
Limited Partner
Partner Subscribed
Interests = 64.418 Capital = $31,242,730
------ -----------
Total
Total General
General Partner
Partner Subscribed
Interests = 5.0 Capital = $ 2,425,000
--- -----------
Total
Subscribed
Total Interests = 69.418 Capital = $33,667,730
------- -----------
83
PIONEER POLAND U.S., L.P.
AMENDMENT TO
AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
THE AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT, dated as of
December 14, 1994 (as amended to date, the "Agreement") of Pioneer Poland U.S.,
L.P., a Delaware limited partnership (the "Partnership"), is hereby amended
effective as of the 3rd day of August, 1999. Capitalized terms used herein, and
not otherwise defined herein, shall have the respective meanings ascribed to
them in the Agreement.
WHEREAS, on the date hereof, Pioneer Poland U.S. (Jersey) Limited (the
"Old General Partner") is the sole general partner of the Partnership; and
WHEREAS, the Old General Partner desires to cease to serve as a general
partner of the Partnership, but desires to retain its economic interest in the
Partnership as a limited partnership interest; and
WHEREAS, the Old General Partner will retain all of its obligations under
the Agreement to contribute capital to the Partnership at the times and on the
terms specified in the Agreement, including without limitation, Section 2.01(a)
and (k) of the Agreement; and
WHEREAS, Pioneer Poland GP Limited Partnership, a Delaware Limited
Partnership (the new General Partner"), desires to be admitted to the
Partnership as a general partner, and to assume the obligations and
responsibilities of the General Partner under the Agreement (other than the
obligations of the Old General Partner to contribute capital to the Partnership,
which will be retained by the Old General Partner); and
WHEREAS, on the date hereof, the Partnership and the Manager have modified
the terms of the Joint Management Agreement to eliminate the Partnership's
obligation to pay Incentive Management Fees thereunder, in consideration for,
among other things, the agreement of the Partners in the Partnership to grant a
partnership interest to the New General Partner which is generally economically
equivalent to the Incentive Management Fee; and
WHEREAS, on or before the date hereof, all persons currently owning
limited partnership interests in the Partnership and general partnership
interests in the Partnership have approved the foregoing matters.
84
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:
1. Assignment and Assumption of Interest Currently Held by Old General
Partner. Effective as of the date hereof, the Old General Partner shall cease to
serve as a general partner of the Partnership. The Old General Partner shall
retain its economic interest in the Partnership as a Limited Partner, with all
of the rights and obligations of a Limited Partner, and its right to
indemnification under Section 4.06 of the Agreement in respect of all periods of
time during which it served as a General Partner. The Old General Partner agrees
to be bound by and subject to the terms of the Agreement as a Limited Partner.
Without limiting the foregoing, the Old General Partner shall retain, and
continue to be responsible for, all of its obligations contribute capital to the
Partnership, in the amounts, on the terms and at the times specified in the
Agreement.
By its execution of this Amendment, the Old General Partner hereby agrees
to be bound by each and every provision of the Agreement which is applicable to
a Limited Partner, including without limitation, the powers of attorney set
forth in Sections 2.01(f) and 8.03 of the Agreement. The Old General Partner
hereby agrees that its limited partnership interest in the Partnership is
subject to restrictions on transfer contained in the Partnership Agreement, and
under applicable state and federal securities laws relating to unregistered
securities, and the Old General Partner agrees to abide by such restrictions.
From and after the date hereof, the Old General Partner shall have no
further responsibility for performing any of the obligations or duties of the
General Partner under the Agreement (except for the capital contribution
obligations described above).
2. Admission of New General Partner. The New General Partner is hereby
admitted to the Partnership as a General Partner, and all of the Partners hereby
consent to such admission. The New General Partner shall have all of the rights
and obligations of the General Partner under the Agreement other than the
obligation to make capital contributions to the Partnership, which obligation
has been retained by the Old General Partner. Subject to the foregoing, the New
General Partner agrees to be bound by the Agreement and perform the duties of
the General Partner thereunder. The New General Partner agrees and acknowledges
that the economic interest in the Partnership owned by the Old General Partner
has been retained by the Old General Partner as described in Section 1 of this
Amendment, and that the economic interest of the New General Partner shall be as
specified in Section 3.01(b)(iii), described below. Subject to the foregoing,
all references in the Agreement to the General Partner shall be deemed to refer
to the New General Partner.
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85
The New General Partner and the Old General Partner shall prepare, execute
and file an amendment to the Partnership's Certificate of Limited Partnership
and such other instruments as may be necessary, appropriate or convenient to
reflect the withdrawal as a general partner of the Old General Partner from the
Partnership, the admission of the New General Partner to the Partnership and the
other matters described in this Amendment.
3. Amendment to Schedule A. The Agreement, including Schedule A thereto,
is hereby deemed to be amended to reflect the conversion of the interest of the
Old General Partner into a Limited Partner, and the admission of the New General
Partner to the Partnership.
4. Amendment to Section 2.02. Section 2.02 of the Agreement is hereby
amended as follows:
(a) Section 2.02(b) is hereby deleted, and the following is substituted
therefor:
"Net Profits" and "Net Losses" mean the taxable income or loss, as
the case may be, for a period as determined in accordance with Code
Section 703(a) computed with the following adjustments:
(i) Items of gain, loss, and deduction shall be computed based
upon the Carrying Values of the Partnership's assets (in accordance with
Treasury Regulation Sections 1.704(b)(2)(iv)(g) and/or 1.704-3(d)) rather
than upon the assets' adjusted bases for federal income tax purposes;
(ii) Any tax-exempt income received by the Partnership shall
be included as an item of gross income;
(iii) The amount of any adjustments to the Carrying Values of
any assets of the Partnership pursuant to Code Section 743 shall not be
taken into account;
(iv) Any expenditure of the Partnership described in Code
Section 705(a)(2)(B) (including any expenditures treated as being
described in Section 705(a)(2)(B) pursuant to Treasury Regulations under
Code Section 704(b)) shall be treated as a deductible expense;
(v) The amount of items of income, gain, loss or deduction
specially allocated to any Partners pursuant to Section 2.05 shall not be
included in the computation; and
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86
(vi) The amount of any items of Net Profits or Net Losses
deemed realized pursuant to Sections 2.03(b) and (c) shall be included in
the computation.
(b) The following definitions are hereby added at the end of Section
2.02 of the Agreement:
(e) "Adjusted Capital Account" means, for each Partner, such
Partner's Capital Account balance increased by such Partner's share
of "minimum gain" and of "partner nonrecourse debt minimum gain" (as
determined pursuant to Treasury Regulation Sections 1.704-2(g) and
1.704-2(i)(5), respectively).
(f) "Partnership Capital" means an amount equal to the sum of
all of the Partners' Adjusted Capital Account balances determined
immediately prior to the allocation to the Partners pursuant to
Sections 2.04(a)(ii) or 2.04(b)(i) of any Net Profits or Net Losses,
increased by the aggregate amount of Net Profits then to be
allocated to the Partners pursuant to Section 2.04(a)(ii) or
decreased by the aggregate amount of Net Losses then to be allocated
to the Partners pursuant to Section 2.04(b)(i).
5. Amendment to Section 2.04. Section 2.04 of the Agreement is
hereby amended to read in its entirety as follows:
2.04 Basic Allocations.
(a) Except as provided in Section 2.05 below (which
shall be applied first), Net Profits of the Partnership for any
relevant period shall be allocated as follows:
(i) First, to any Partners having negative
Adjusted Capital Account balances, in proportion to and to the
extent of such negative balances; and
(ii) The balance, if any, to the Partners in such
proportions and in such amounts as would result in the
Adjusted Capital Account balance of each Partner equaling, as
nearly as possible, such Partner's share of the then
Partnership Capital determined by calculating the amount the
Partner would receive if an amount equal to the Partnership
Capital were distributed to the Partners in accordance with
the provisions of Section 3.01(b) hereof.
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87
(b) Except as provided in Section 2.05 below (which
shall be applied first), Net Losses of the Partnership for any
relevant period shall be allocated among the Partners as follows:
(i) First, to each Partner with a positive
Adjusted Capital Account balance, in the amount of such
positive balance; provided, however, that if the amount
of Net Losses to be allocated is less than the sum of
the Adjusted Capital Account balances of all Partners
having positive Adjusted Capital Account balances, then
the Net Losses shall be allocated to the Partners in
such proportions and in such amounts as would result in
the Adjusted Capital Account balance of each Partner
equaling, as nearly as possible, such Partner's share of
the then Partnership Capital determined as set forth in
Section 2.04(a) above; and
(ii) The balance, if any, 100% to the New General
Partner.
(c) If the amount of Net Profits allocable to the
Partners pursuant to Section 2.04(a)(ii) or the amount of Net Losses
allocable to them pursuant to Section 2.04(b)(i) is insufficient to
allow the Adjusted Capital Account balance of each Partner to equal
such Partner's share of the Partnership Capital, such Net Profits or
Net Losses shall be allocated among the Partners in such a manner as
to decrease the differences between the Partners' respective
Adjusted Capital Account balances and their respective shares of the
Partnership Capital in proportion to such differences.
(d) Allocations of Net Profits and Net Losses provided
for in this Section 2.04 shall generally be made as of the end of
the fiscal year of the Partnership; provided, however, that
allocations of items of Net Profits and Net Losses described in
clause (vi) of the definition of "Net Profits" and "Net Losses"
shall be made at the time deemed realized as described in Section
2.03.
6. Amendment to Section 2.05. Section 2.05(e) of the Agreement is
hereby deleted.
7. Amendment to Section 3.01. Section 3.01 of the Agreement is
hereby amended as follows:
(a) Section 3.01(a) is hereby amended by adding thereto the
following additional definitions:
"Net Invested Capital. "Net Invested Capital" means the
excess, if any, of (i) the aggregate amount of the Subscribed
Capital actually contributed by a
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88
Partner to the Partnership over (ii) the aggregate amount distributed to
such Partner pursuant to Section 3.01(b)(i) below from time to time.
Priority Return. "Priority Return" means, at any point in time, for
any Partner, that amount which, when considered together with all amounts
previously distributed to such Partner pursuant to Section 3.01(b)(ii),
will result in such Partner having received distributions pursuant to such
Section equal to an 8% cumulative return, compounded annually, on such
Partner's weighted average Net Invested Capital."
(b) Section 3.01(b) is hereby amended to read in its entirety as follows:
"(b) From and after December 14, 1995, Distributable Cash shall be
distributed to and among the Partners, at such times and in
such amounts as shall be determined by the General Partner
(but not less frequently than annually) as follows:
(i) First, to the Partners in proportion to their
respective amounts of Net Invested Capital until the
Net Invested Capital of each Partner has been reduced
to zero;
(ii) Second, to the Partners in proportion to their
respective amounts of Priority Return until the
Priority Return of each Partner has been reduced to
zero; and
(iii) The balance, if any, 75% to all Partners other than the
General Partner (which amount shall be allocated among
such Partners in proportion to their respective number
of Interests in the Partnership), and 25% to the
General Partner in its capacity as General Partner;
provided, however, that if at any time the Joint
Management Agreement has been terminated in accordance
with the terms thereof, from and after the date of such
termination, 100% of all amounts distributed pursuant
to this clause (iii) shall be distributed to the
Partners other than the General Partner (which amount
shall be allocated among such Partners in proportion to
their respective number of Interests in the
Partnership)."
8. Sections 7.02(c) and 8.16 of the Agreement are hereby deleted in their
entirety.
9. To the extent that any of the provisions of the Agreement is
inconsistent with the matters described herein or the transactions contemplated
hereby, the
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89
Agreement is hereby amended to the extent reasonably necessary to effectuate
such matters and consummate such transactions.
10. In all other respects, the Agreement is hereby ratified and confirmed.
IN WITNESS WHEREOF, the undersigned, constituting all of the Partners of
the Partnership, have executed this Amendment as of the date set forth above.
PIONEER POLAND U.S. (JERSEY) LIMITED
(CONVERTED TO A LIMITED PARTNER
HEREBY)
By /s/ XXXXX A. N. XXXXXX
-------------------------------
Name XXXXX A. N. XXXXXX
-----------------------------
Title DIRECTOR
----------------------------
GENERAL PARTNER ADMITTED HEREBY:
PIONEER POLAND GP LIMITED
PARTNERSHIP
By Pioneer Poland U.S. (Jersey) Limited,
General Partner
By /s/ XXXXX A. N. XXXXXX
-------------------------------
Name XXXXX A. N. XXXXXX
-----------------------------
Title DIRECTOR
----------------------------
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90
LIMITED PARTNERS (THOSE PERSONS
NAMED AS LIMITED PARTNERS ON
SCHEDULE A TO THE AGREEMENT):
By Pioneer Poland U.S. (Jersey) Limited,
Their Attorney-In- Fact
By /s/ XXXXX A. N. XXXXXX
-------------------------------
Name XXXXX A. N. XXXXXX
-----------------------------
Title DIRECTOR
----------------------------
-8-
