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CONNING INVESTMENT PARTNERS LIMITED PARTNERSHIP III
(A Delaware Limited Partnership
Organized to Serve as General Partner
of Conning Insurance Capital Limited Partnership III
and Investment General Partner of
Conning Insurance Capital International Partners III)
AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
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Dated as of March 18, 1994
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THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE
AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT
TO REGISTRATION OR EXEMPTION THEREFROM AND WITH THE APPROVAL OF THE GENERAL
PARTNER. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE
RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
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CONNING INVESTMENT PARTNERS LIMITED PARTNERSHIP III
Amended and Restated
Limited Partnership Agreement
Table of Contents
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Page
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I. DEFINITIONS 1
1.1 Definitions 1
II. ORGANIZATION 1
2.1 Continuation of Limited Partnership 1
2.2 Name 1
2.3 Address 1
2.4 Purpose 2
2.5 Powers 2
III. GENERAL PARTNER 2
3.1 Name, Address and Subscription 2
3.2 Management and Control of the Partnership 2
3.3 Powers 2
3.4 Certificate of Limited Partnership 3
3.5 Duty of Care 3
3.6 No Salary 4
3.7 Tax Matters Partner 5
IV. LIMITED PARTNERS 5
4.1 Names, Addresses and Subscriptions 5
4.2 Limited Liability 6
4.3 No Control of Partnership 6
4.4 Bankruptcy, etc. 6
V. ADMISSION OF ADDITIONAL LIMITED PARTNERS 6
5.1 Admission of Additional Limited Partners 6
5.2 Capital Contribution 6
5.3 Accession to Agreement 7
VI. CAPITAL OF THE PARTNERSHIP 7
6.1 Capita1 Contributions 7
6.2 No Interest or Withdrawals 7
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VII. ACCOUNTS 7
7.1 Capital Accounts 7
7.2 Accounting for Distributions in Kind 7
7.3 Compliance With Treasury Regulations 8
VIII. ALLOCATIONS 8
8.1 General 8
8.2 Net Gain or Loss 8
8.3 Timing of Allocations on Distributions in Kind 8
8.4 Regulatory Allocations 9
8.5 Adjustments to Reflect Chance in Interests 11
8.6 Tax Allocations 11
8.7 Timing of Allocations 12
IX. DISTRIBUTIONS 12
9.1 Timing of Distributions 12
9.2 Tax Distributions 12
9.3 Additional Distributions 13
9.4 Operational Rules 13
9.5 Tax Withholding 14
9.6 Certain Distributions Prohibited 14
9.7 Consent to Distributions 14
X. VALUATION OF PARTNERSHIP ASSETS 15
10.1 Valuation by General Partner 15
10.2 Goodwill 15
XI. DURATION OF PARTNERSHIP 15
11.1 Term of Partnership 15
11.2 Dissolution Upon Withdrawal of General Partner 15
11.3 No Dissolution on Events Affecting Limited Partners 15
11.4 Extension of Term 15
XII. LIQUIDATION OF PARTNERSHIP INTERESTS 15
12.1 General Provisions 15
12.2 Liquidating Distributions 16
12.3 Expenses of Liquidator(s) 16
12.4 Duration of Liquidation 16
12.5 Duty of Care 16
12.6 No Liability for Return of Capital 17
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XIII. LIMITATION ON TRANSFER OF INTERESTS OF LIMITED PARTNERS OR
RETIRED PARTNERS 17
13.1 Consent of General Partner to Transfers 17
13.2 Opinion of Counsel 17
13.3 Expenses 17
13.4 Substitution of Limited Partners or Retired Partners 18
13.5 Covenants of Limited Partners and Retired Partners 18
XIV. WITHDRAWAL OF PARTNERSHIP INTERESTS 19
14.1 Withdrawals Generally Prohibited 19
14.2 Withdrawal upon Death, Disability, Bankruptcy or Termination
of Employment 19
XV. RETIRED LIMITED PARTNERS 19
15.1 General 19
15.2 Adjustments to Reflect Retirement 19
15.3 Retired Partner Participation 20
XVI. LIMITATION ON TRANSFER OF INTEREST OF THE GENERAL PARTNER 20
XVII. INDEMNIFICATION 20
17.1 General Provisions 20
17.2 Advance Payment of Expenses 21
17.3 Insurance 22
17.4 Limitation or Expansion by Law 22
XVIII. ACCOUNTING, RECORDS AND REPORTS 22
18.1 Fiscal Year 22
18.2 Keeping of Accounts and Records 23
18.3 Inspection Rights 23
18.4 Annual Financial Statements 23
18.5 Accounting Method 24
XIX. WAIVER AND AMENDMENT 24
XX. GENERAL PROVISIONS 24
20.1 Notices 24
20.2 Power of Attorney 24
20.3 Waiver of Partition 26
20.4 Additional Documents 26
20.5 Binding on Successors 26
20.6 Counterparts 26
20.7 Voting 26
20.8 Governing Law 26
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20.9 Securities Act Matters 26
20.10 Authority of General Partner 27
20.11 Contract Construction 27
20.12 Section Headings 27
Names, Addresses, Subscriptions and Percentage Interests of Partners Schedule A
Vesting Schedules Schedule B
General Partner's Intention to Reduce Percentage Interest Schedule C
Table of Definitions Appendix A
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CONNING INVESTMENT PARTNERS LIMITED PARTNERSHIP III
Amended and Restated
Limited Partnership Agreement
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AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT, dated as of this
18th day of March, 1994 by and among Conning & Company, a Connecticut
corporation, as general partner (the "General Partner") and any individuals,
firms, corporations, and other entities who are admitted to the limited
partnership formed hereby on or after the effective date of this Agreement
who are listed on Schedule A hereto and who execute a counterpart of this
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Agreement as limited partners (such limited partners being referred to herein
as the "Limited Partners"). The General Partner and the Limited Partners are
sometimes referred to herein collectively as the "Partners".
The General Partner and ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ formed the Partnership by
executing the Limited Partnership Agreement of Conning Investment Partners
Limited Partnership III, dated as of December 28, 1993 (the "Partnership
Agreement") and by filing with the Secretary of State of Delaware a
Certificate of Limited Partnership on December 28, 1993.
The Partnerships of the Partnership desire to amend and restate the
Partnership Agreement as hereinafter provided, and in consideration of the
premises and the agreements herein contained and intending to be legally
bound hereby agree that the Partnership Agreement shall be amended and
restated in whole to read as follows:
ARTICLE I - DEFINITIONS.
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1.1 DEFINITIONS. Capitalized terms used herein without definitions
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shall have the meanings assigned to them in Appendix A hereto.
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ARTICLE II - ORGANIZATION.
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2.1 CONTINUATION OF LIMITED PARTNERSHIP. The Partners agree to carry
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on a limited partnership (the "Partnership") subject to the terms of this
Agreement in accordance with the provisions of the Delaware Revised Uniform
Limited Partnership Act, as amended (the "Delaware Act").
2.2 NAME. The name of the Partnership is "Conning Investment
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Partners Limited Partnership III" The General Partner may change the name of
the Partnership to such other name as the General Partner may determine at
any time, upon written notice to all Partners indicating such new name.
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2.3 ADDRESS. The initial address of the Partnership's registered
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office in Delaware is ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇-▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇ of
Kent, and its initial registered agent at such address for service of process
is The ▇▇▇▇▇▇▇▇-▇▇▇▇ Corporation System, Inc. The initial principal office
of the Partnership shall be located at CityPlace II, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇. The General Partner may change the
location of the principal office of the Partnership to such other location
within the United States as the General Partner may determine at any time,
upon written notice to all the Partners indicating the new location of such
principal office. The General Partner may cause the Partnership to open such
additional offices at such other locations as the General Partner in its sole
discretion may determine.
2.4 PURPOSE. The principal purpose of the Partnership is to organize
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and act as the general partner of Conning Insurance Capital Limited
Partnership III (the "Domestic Fund"), a Delaware limited partnership, and as
Investment General Partner of Conning Insurance Capital International
Partners III, a Cayman Islands limited partnership (the "Offshore Fund"); the
Domestic Fund and the Offshore Fund are each referred to as a "Fund" and
collectively referred to as the "Funds") and in furtherance thereof to engage
in any lawful act or activity for which limited partnerships may be organized
under the laws of the State of Delaware.
2.5 POWERS. Subject to all of the terms and provisions hereof, the
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Partnership shall have all the powers available to it as a limited
partnership under the laws of the State of Delaware.
ARTICLE III - GENERAL PARTNER.
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3.1 NAME, ADDRESS AND SUBSCRIPTION. The name and address of the
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General Partner, its Subscription and its percentage interest in certain
Partnership allocations to be made hereunder ("Percentage Interest") are set
forth in Schedule A. Schedule A shall be amended from time to time, without
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the consent of any Partner, to reflect any changes in the Subscription of the
General Partner occurring pursuant to the provisions of this Agreement.
3.2 MANAGEMENT AND CONTROL OF THE PARTNERSHIP. Subject to the
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provisions of this Agreement, the management, policies and control of the
Partnership shall be vested exclusively in the General Partner. Limited
Partners may, to the extent expressly provided in this Agreement, possess or
exercise any of the powers, or have or act in any of the capacities,
permitted under Section 17-303(b) of the Delaware Act for limited partners
who are deemed thereby not to participate in the control of the affairs of a
limited partnership.
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3.3 POWERS. Subject to the provisions of this Agreement, the General
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Partner shall have the power on behalf and in the name of the Partnership to
carry out and implement any and all of the purposes of the Partnership set
forth in Section 2.4 and to exercise any of the powers of the Partnership set
forth in Section 2.5, including, without limitation, the power to:
(a) open, maintain and close accounts with brokers and give
instructions or directions in connection therewith;
(b) open, maintain and close bank accounts and draw checks or
other orders for the payment of money;
(c) receive, receipt for and dispose of and deal in all
securities, checks, money and other assets or liabilities of the Partnership;
(d) hire employees or retain investment bankers, attorneys,
accountants, consultants, custodians, contractors and other agents, and pay
them compensation;
(e) execute on behalf of the Partnership, as general partner of
the Fund, any agreement between the Partnership and the Fund or any amendment
or termination thereof;
(f) enter into, make and perform such contracts, agreements and
other undertakings, and do any and all such other acts required of the
Partnership or the Fund with respect to the Partnership's or the Fund's
interest in any corporation, partnership, limited partnership, trust,
association or other entity or activity, including but not limited to
entering into agreements with respect to such interests, which agreements may
contain such terms, conditions and provisions as the General Partner in its
sole discretion shall approve;
(g) make all elections for the Partnership that are permitted
under tax or other applicable laws, including, without limitation, an
election under Section 754 of the Code; and
(h) maintain one or more offices within or without the State of
Connecticut and in connection therewith rent or acquire office space and do
such other acts as may be advisable in connection with the maintenance of
such offices; provided, however, that maintaining such offices, renting or
acquiring office space and doing any such other acts shall not affect the
limited liability of the Limited Partners as set forth in Section 4.2 hereof.
3.4 CERTIFICATE OF LIMITED PARTNERSHIP. The General Partner shall
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file for record with the appropriate public authorities and, if required,
publish the Certificate of Limited Partnership of the Partnership and any
amendments thereto, and
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shall take all such other action as may be required to preserve the limited
liability of the Limited Partners in any jurisdiction in which the
Partnership shall conduct its activities.
3.5 DUTY OF CARE. The General Partner shall exercise its best
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judgment in conducting the Partnership's operations and in performing its
other duties hereunder. The General Partner shall not incur any liability to
the Partnership, any Partner or any other Person for any loss suffered by the
Partnership or such other Partner or Person which arises out of any action or
omission of the General Partner or any Affiliate of the General Partner
assisting the General Partner, at the General Partner's request, in
performing the General Partner's duties hereunder, provided that (a) the
General Partner or such Affiliate of the General Partner acted in good faith
and in a manner such Person reasonably believed to be in, or not opposed to,
the best interests of the Partnership and, with respect to any criminal
action or proceeding, had no reasonable cause to believe such Person's
conduct was unlawful, and (b) such course of conduct did not constitute gross
negligence or willful misconduct of the General Partner or such Affiliate of
the General Partner. No Affiliate of the General Partner shall incur any
liability to the Partnership, any Partner or any other Person for any loss
suffered by the Partnership or such other Partner or Person which arises out
of any action or omission of the General Partner, or out of any action or
omission of such Affiliate of the General Partner taken or suffered by such
Affiliate of the General Partner in the course of providing assistance to the
General Partner at the General Partner's request, provided that (1) such
Affiliate of the General Partner acted in good faith and in a manner such
Affiliate of the General Partner reasonably believed to be in, or not opposed
to, the best interests of the Partnership and, with respect to any criminal
action or proceeding, had no reasonable cause to believe such Person's
conduct was unlawful, and (2) such course of conduct did not constitute gross
negligence or willful misconduct of such Affiliate of the General Partner.
No Affiliate of the General Partner shall be liable for any action taken or
omitted by any other Affiliate of the General Partner unless such action or
omission was taken or suffered by such other Affiliate of the General Partner
while acting as an agent of such Affiliate of the General Partner and, with
respect to such action or omission, such other Affiliate of the General
Partner did not satisfy the requirements of clauses (1) and (2) of the
preceding sentence. Neither the General Partner nor any Affiliate of the
General Partner shall be liable for the negligence, whether of omission or
commission, dishonesty or bad faith of any employee, broker or other agent of
the Partnership selected by the General Partner with reasonable care. The
General Partner and each Affiliate of the General Partner shall be fully
protected and justified with respect to any action or omission taken or
suffered by any of them in good faith if such action or omission is taken or
suffered in reliance upon and in accordance with the opinion or
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advice as to matters of law of legal counsel, or as to matters of accounting of
accountants, selected by any of them with reasonable care. In addition, the
General Partner and each of its Affiliates shall be entitled to indemnification
by the Partnership to the extent provided in Article XVII hereof.
3.6 NO SALARY. The General Partner shall receive no salary or other
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compensation from the Partnership, but shall be entitled to its share of
allocations and distributions made by the Partnership determined in the
manner set forth herein.
3.7 TAX MATTERS PARTNER. The tax matters partner, as defined in
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Section 6231 of the Code, of the Partnership shall be the General Partner
(the "Tax Matters Partner"). The Tax Matters Partner shall not resign as Tax
Matters Partner unless, on the effective date of such resignation, the
Partnership has designated another general partner as Tax Matters Partner and
that general partner has given its consent in writing to its appointment as
Tax Matters Partner. The Tax Matters Partner shall receive no additional
compensation from the Partnership for its services in that capacity, but all
expenses incurred by the Tax Matters Partner in such capacity shall be borne
by the Partnership. The Tax Matters Partner is authorized to employ such
accountants, attorneys and agents as it, in its sole discretion, determines
are necessary to or useful in the performance of its duties. Any Person who
serves as Tax Matters Partner shall not be liable to the Partnership or to
any Partner for any action it takes or fails to take as Tax Matters Partner
with respect to any administrative or judicial proceeding involving
"partnership items" (as defined in Section 6231 of the Code) of the
Partnership, unless such action or failure to act constitutes a violation of
the General Partner's duty of care set forth in Section 3.5.
ARTICLE IV - LIMITED PARTNERS.
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4.1 NAMES, ADDRESSES AND SUBSCRIPTIONS. The names and addresses of
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the Limited Partners and their respective Subscriptions and Percentage
Interests are set forth in the supplements referred to on Schedule A.
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Schedule A and the supplements shall be amended from time to time, without
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the consent of any Partner, to reflect any changes in the identity,
Subscriptions or Percentage Interests of the Limited Partners occurring
pursuant to the terms of this Agreement. The General Partner may, without
the consent of any Partner, at any time or from time to time increase the
Percentage Interest of any Limited Partner by reduction of the General
Partner's Percentage Interest. In addition, on one or more occasions on or
before January 25, 1998, in connection with the admission of any new Limited
Partner(s), the General Partner may reduce the Percentage Interest of any
Limited Partner or Retired Partner (which reductions shall be done on a pro
rata basis as to all Limited Partners and Retired Partners on each occasion,
subject to a
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lesser reduction in the case of a particular Limited Partner due to the
limitation set forth below on the maximum amount by which any Limited Partner's
or Retired Partner's Percentage Interest may be reduced) and reallocate such
reduction amounts to such new Limited Partner(s), with the maximum reduction for
any Limited Partner or Retired Partner being ten percent (10%) of the total
maximum Percentage Interest held by such Limited Partner or Retired Partner at
such time, after reducing such ten percent (10%) amount by all previous
reductions pursuant to this provision. It is the intent of the General Partner
to reduce its Percentage Interest (and to correspondingly increase the
Percentage Interest of the Limited Partners in the aggregate) to 40% by January
31, 1997, according to Schedule C.
4.2 LIMITED LIABILITY. The liability of each of the Limited Partners
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to the Partnership shall be limited to the sum of (1) any unpaid capital
contributions which it agreed to make to the Partnership, to the extent
provided in Section 17-502(b) of the Delaware Act; and (2) any distribution
which such Limited Partner is required to return to the Partnership pursuant
to Section 17-607(b) of the Delaware Act.
4.3 NO CONTROL OF PARTNERSHIP. No Limited Partner, in his capacity
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as such, shall take any part in the control of the affairs of the
Partnership, or undertake any activities on behalf of the Partnership, or
have any power to sign for or to bind the Partnership.
4.4 BANKRUPTCY, ETC. The bankruptcy, liquidation, dissolution, death
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or incompetency of a Limited Partner shall not result in the termination of
the Partnership, but the rights of such Limited Partner under this Agreement
shall accrue to such Limited Partner's successor or estate.
ARTICLE V - ADMISSION OF ADDITIONAL LIMITED PARTNERS.
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5.1 ADMISSION OF ADDITIONAL LIMITED PARTNERS.
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(a) The General Partner may admit to the Partnership one or
more additional Limited Partners.
(b) Upon the admission of an additional Limited Partner, the
General Partner shall (1) determine the Percentage Interest and Subscription
of such additional Limited Partner and (2) cause the General Partner's
Percentage Interest to be reduced to reflect the Percentage Interest
allocated to the additional Limited Partner or make such other adjustments to
the Percentage Interests of the Partners as the General Partner, with the
consent of each affected Limited Partner, shall determine.
5.2 CAPITAL CONTRIBUTION. Upon the admission of any new Limited
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Partner, such new Limited Partner shall make a capital contribution to the
Partnership in the amount equal to its Subscription.
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5.3 ACCESSION TO AGREEMENT. Each Person who is to be admitted as an
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additional Limited Partner shall accede to this Agreement by executing,
together with the General Partner, an amendment to this Agreement providing
for such admission. In addition, the General Partner shall execute, file
and, where necessary, record any required amendments to the Partnership's
Certificate of Limited Partnership. The admission of additional Limited
Partners to the Partnership shall be effective upon the execution of the
necessary amendment to this Agreement or such later effective date as is set
forth in such amendment.
ARTICLE VI - CAPITAL OF THE PARTNERSHIP.
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6.1 CAPITAL CONTRIBUTIONS. The General Partner shall make capital
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contributions to the Partnership as and when required to permit the
Partnership to satisfy its obligations as General Partner or Investment
General Partner of the Domestic Fund and Offshore Fund, respectively. Each
Limited Partner shall make capital contributions equal in amount to its
Subscription upon his, her or its admission to the Partnership.
6.2 NO INTEREST OR WITHDRAWALS. No interest shall accrue on any
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capital contribution made by a Partner, and no Partner shall have the right
to withdraw or to be repaid any of his capital contributions so made, except
as specifically provided in this Agreement.
ARTICLE VII - ACCOUNTS.
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7.1 CAPITAL ACCOUNTS. There shall be established on the books of the
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Partnership a capital account ("Capital Account") for each Partner that shall
consist of such Partner's initial capital contribution to the Partnership,
(a) increased by (i) any additional capital contributions made by such
Partner to the Partnership and (ii) any amounts from time to time added to
the Capital Account of such Partner pursuant to Article VIII; and (b)
decreased by (i) any distributions made to such Partner and (ii) any amounts
from time to time subtracted from the Capital Account of such Partner
pursuant to Article VIII.
7.2 ACCOUNTING FOR DISTRIBUTIONS IN KIND. For purposes of
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maintaining Capital Accounts when Partnership property is distributed in
kind, (a) the Partnership shall treat such property as if it had been sold
for its fair market value on the date of distribution as determined in
accordance with Article X hereof; (b) any difference between the fair market
value of such property as so determined and the Cost of such property shall
constitute Net Gain or Loss and shall be allocated to the Capital Accounts of
the Partners pursuant to Section 8.3(a), and (c) all property distributed in
kind by the Partnership to a Partner shall be debited to that Partner's
Capital Account at the fair market value of such property on the date of
distribution (net of any liabilities secured by such distributed property
that such
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Partner is considered to assume or take subject to under Section 752 of the
Code).
7.3 COMPLIANCE WITH TREASURY REGULATIONS. The foregoing provisions
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and the other provisions of this Agreement relating to the maintenance of
Capital Accounts are intended to comply with Section 704(b) of the Code and
Treasury Regulations Section 1.704-l(b), and shall be interpreted and applied
in a manner consistent with such regulations. If the General Partner shall
determine that it is prudent to modify the manner in which the Capital
Accounts, or any debits or credits thereto, are computed in order to comply
with such regulations, the General Partner may make such modification,
provided the General Partner reasonably determines such modification is not
likely to have a material effect on the amounts distributable to any Partner
pursuant to Articles IX or XII hereof.
ARTICLE VIII - ALLOCATIONS.
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8.1 GENERAL. Partnership income, gain, loss, deductions and expenses
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shall be allocated to the Capital Accounts of the Partners in accordance with
this Article VIII.
8.2 NET GAIN OR LOSS. (a) As of the end of each year of the
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Partnership, and after giving effect to the allocations set forth in Sections
8.3, 8.4 and 8.6(b), the Net Gain or Loss of the Partnership for such fiscal
period shall be allocated as follows:
(a) All Net Gain or Loss attributable to allocations made by
the Fund to the Partnership in its capacity as general partner of the Fund:
(i) which are made with respect to the capital contribution
of the Partnership to the Fund shall be allocated to the General Partner;
and
(ii) which are made other than with respect to the capital
contribution of the Partnership to the Fund (e.g., the Partnership's
"carried interest" in the profits or losses or net profits or losses of
the Fund) shall be allocated among the Partners in proportion to their
respective Percentage Interests.
(b) All Short-Term Income shall be allocated to the General
Partner.
(c) All other Net Gain or Loss of the Partnership shall be
allocated to all Partners in proportion to their respective Percentage
Interests.
8.3 TIMING OF ALLOCATIONS ON DISTRIBUTIONS IN KIND. Any Net Gain or
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Loss of the Partnership that is attributable to a
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distribution of property in kind by the Partnership or the Fund shall be
allocated as follows (subject to the remainder of this Article VIII):
(a) Net Gain or Loss of the Partnership attributable to amounts
allocated by the Fund to the Partnership in its capacity as the general
partner of the Fund as a result of distributions in kind of Fund property
shall be allocated to all Partners, at the time such allocations are made by
the Fund, on the same basis that an equivalent amount of Net Gain or Loss
attributable to Fund allocations would be allocated by the Partnership for a
hypothetical fiscal year ending immediately prior to the distribution in kind
by the Fund that gave rise to such Net Gain or Loss.
(b) Net Gain or Loss resulting pursuant to Section 7.2 from the
distribution by the Partnership of its property in kind shall be allocated to
all Partners, immediately prior to the time such distribution is made, on the
same basis that an equivalent amount of Net Gain or Loss not attributable to
Fund allocations would be allocated for a hypothetical fiscal year ending
immediately prior to the distribution in kind that gave rise to such Net Gain
or Loss.
(c) For purposes of applying the loss allocation limitations of
Section 8.4 in the case of an allocation of Net Gain or Loss pursuant to
subsections (a) or (b) above for a hypothetical fiscal year, the actual
balances in the Partners' Capital Accounts shall be adjusted to reflect prior
distributions in kind made during such hypothetical fiscal year by the Fund
or the Partnership, but not any realized gains or losses of the Partnership
for such hypothetical fiscal year.
8.4 REGULATORY ALLOCATIONS. The following provisions are included in
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order to comply with tax rules set forth in the Code and to permit the
Partnership to obtain the benefits of a "safe harbor" provided by Treasury
Regulation Section 1.704--1(b)(2)(ii)(d).
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(a) If and to the extent that any allocation of Net Loss,
Issuance Items or other items of loss, expense (or portion thereof) to any
Partner would cause such Partner's Capital Account to be negative by an
amount which exceeds such Partner's Restoration Amount or would further
reduce a balance in such Partner's Capital Account that is already negative
by an amount which exceeds such Partner's Restoration Amount, then such loss,
expense or charge (or portion thereof) shall be allocated first to the
Capital Accounts of the other Partners in proportion to the positive balances
in their respective Capital Accounts until all such Capital Accounts are
reduced to zero, then to the Capital Accounts of Partners with Restoration
Amounts, in proportion to their respective Restoration Amounts, until each
such Partner's Capital Account is negative by an amount equal to
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such Partner's Restoration Amount, and then to the Capital Account of the
General Partner; provided that an allocation pursuant to this Section 8.4(a)
shall be made only if and to the extent that such Partner would have an Capital
Account that is negative by an amount which exceeds such Partner's Restoration
Amount after all allocations provided for in this Article VIII have been made
tentatively as if this Section 8.4 were not included in this Agreement.
(b) If any Partner unexpectedly receives an adjustment,
allocation or distribution described in Treasury Regulation Section
1.704-l(b)(2)(ii)(d)(4), (5) or (6), and such adjustment, allocation or
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distribution causes such Partner to have a deficit balance in such Partner's
Capital Account, there shall be allocated to such Partner items of income and
gain (consisting of a pro rata portion of each item of Partnership income,
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including gross income, and gain for such fiscal period) in an amount and
manner sufficient to eliminate such Partner's deficit Capital Account
balance, to the extent required by Treasury Regulation Section
1.704-1(b)(2)(ii)(d), as quickly as possible, provided that an allocation
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pursuant to this Section 8.4(b) shall be made only if and to the extent that
such Partner would have a negative Capital Account after all allocations
provided for in this Section 8.4 have been made tentatively as if this Section
8.4(b) were not included in this Agreement. The foregoing sentence is intended
to constitute a "qualified income offset" provision as described in Treasury
Regulation Section 1.704-1(b)(2)(ii)(d), and shall be interpreted and applied in
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all respects in accordance with that Section.
(c) In the event that any Partner has a negative Capital
Account at the end of any Partnership fiscal year which is in excess of such
Partner's Restoration Amount, there shall be allocated to such Partner items
of Partnership income (including gross income) and gain in the amount of such
excess as quickly as possible, provided that an allocation pursuant to this
Section 8.4(c) shall be made only if and to the extent that the deficit in
such Partner's Capital Account would exceed such Partner's Restoration Amount
after all allocations provided for in this Article VIII have been made
tentatively as if Section 8.4(b) hereof and this Section 8.4(c) were not
included in this Agreement.
(d) To the extent that an adjustment to the adjusted tax basis
of any Partnership asset pursuant to Section 743(b) of the Code is required,
pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m), to be taken
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into account is determining Capital Accounts, the amount of such adjustment
to the Capital Accounts shall be treated as an item of gain (if the
adjustment increases the basis of the asset) or loss (if the adjustment
decreases such basis) and such gain or loss shall be specially allocated to
the Partners in a manner consistent with the manner in which their Capital
Accounts are required to be adjusted pursuant to such Section of the
Regulations.
- 10 -
16
(e) The allocations set forth in Sections 8.4(a), 8.4(b),
8.4(c) and 8.4(d) hereof (the "Regulatory Allocations") are intended to
comply with certain requirements of Treasury Regulation Section 1.704-l(b).
Notwithstanding any other provisions of this Article VIII (other than the
Regulatory Allocations), the Regulatory Allocations shall be taken into
account in allocating subsequent Net Gain, Net Loss, Issuance Items and items
of income, gain, loss and deduction among the Partners so that, to the extent
possible, the net amount of such allocations of subsequent Net Gain, Net
Loss, Issuance Items and other items and the Regulatory Allocations to each
Partner shall be equal to the net amount that would have been allocated to
each such Partner pursuant to the provisions of this Article VIII if the
Regulatory Allocations had not occurred.
For purposes of applying the foregoing sentence,
allocations pursuant to this Section 8.4(e) shall be made with respect to
allocations pursuant to Section 8.4(d) only to the extent the General Partner
reasonably determines that such allocations will otherwise be inconsistent
with the economic agreement among the Partners.
(f) If the Partnership, in its capacity as general partner of
the Fund, receives any special allocations from the Fund pursuant to certain
provisions of the Fund Partnership Agreements dealing with certain
"extraordinary allocations", the General Partner, after consulting with the
Partnership's accountants and other advisors, shall allocate such amounts
among the Partners in a manner consistent with the economic arrangements
among the Partners and the purpose of such provisions.
8.5 ADJUSTMENTS TO REFLECT CHANGE IN INTERESTS. Notwithstanding the
------------------------------------------
foregoing, with respect to any fiscal period during which any Partner's
interest in the Partnership changes, whether by reason of the admission of a
Partner, the withdrawal of a Partner, a non-pro rata contribution of capital
--- ----
to the Partnership or any other event described in Section 706(d)(1) of the
Code and regulations issued thereunder, allocations of Net Gain or Loss shall
be adjusted appropriately to take into account the varying interests of the
Partners during such period. The General Partner shall consult with the
Partnership's accountants and other advisors and shall select the method of
making such adjustments, which method shall be used consistently thereafter.
8.6 TAX ALLOCATIONS.
---------------
(a) For federal, state and local income tax purposes,
Partnership income, gain, loss, deduction or credit (or any item thereof) for
each fiscal year shall be allocated to and among the Partners in order to
reflect the allocations made pursuant to the provisions of this Article VIII
for such fiscal year (other than allocations of items which are not
deductible or
- 11 -
17
are excluded from taxable income), taking into account any variation between the
adjusted tax basis and book value of Partnership property in accordance with the
principles of Section 704(c) of the Code.
(b) Any income, gain, loss or deduction realized as a direct or
indirect result of the issuance of a Partnership interest by the Partnership
to a Partner, the issuance to the Partnership of an interest in the Fund or
changes during the term of the Partnership in any Partner's Percentage
Interest or Subscription ("Issuance Items") shall be allocated among the
Partners so that, to the extent possible, the net amount of such Issuance
Items, together with all other allocations under this Agreement to each
Partner, shall be equal to the net amount that would have been allocated to
each such Partner if the Issuance Items had not been realized. Issuance
Items allocated to any Partner shall be added to such Partner's Capital
Account if such items constitute income or gain, and shall be subtracted from
that Capital Account if such items constitute losses or expenses.
8.7 TIMING OF ALLOCATIONS. The General Partner, in its sole
---------------------
discretion, may cause the Partnership to make the allocations described in
this Article VIII (other than allocations for tax purposes pursuant to
Section 8.6) as of a time other than the end of a fiscal quarter on the basis
of an interim closing of the Partnership's books at such time, but only if a
Fund makes such interim allocations. In such event, each short fiscal period
attributable to any such interim closing shall constitute a fiscal quarter
for purposes of this Article VIII.
ARTICLE IX - DISTRIBUTIONS.
--------------------------
9.1 TIMING OF DISTRIBUTIONS. The Partnership intends to distribute
-----------------------
promptly to the Partners all cash and other property it receives in
distributions from the Fund or any other source; provided, however, that the
-------- -------
General Partner may defer any such distribution to provide for liabilities or
obligations of the Partnership or to establish appropriate reserves.
9.2 TAX DISTRIBUTIONS.
-----------------
(a) The Partnership intends to distribute to the Partners, as
it is received, the amount ("Tax Distribution") of any distribution received
from the Funds as a tax distribution. Such distribution shall be made to the
Partners in amounts which would enable the Partners to satisfy their
respective tax liabilities, assuming for this purpose that all Partners are
subject to the highest rate of tax that may be applicable to any Partner, as
determined by the General Partner in consultation with accountants to the
Partnership.
- 12 -
18
(b) Notwithstanding the foregoing, (i) amounts otherwise
distributable to any Partner as Tax Distributions with respect to any taxable
year shall be reduced (but not below zero) by any other distributions made by
the Partnership to such Partner during such fiscal year; and (ii) the
aggregate amount of distributions that otherwise would be made pursuant to
this Section 9.2 with respect to any taxable year shall be reduced or
eliminated to the extent determined by the General Partner pursuant to the
proviso to Section 9.1.
-------
(c) To the extent the Partnership receives from the Funds any
amounts which are treated under the Fund Partnership Agreements as an advance
against tax distributions to permit the Partners of the Partnership to make
estimated tax payments, such amounts, when received by the Partners, shall
similarly be treated as advances against Tax Distributions, and shall be
subject to return by the Partners to the Partnership to the extent such
advances are determined by the General Partner to have been excessive upon
calculation at the end of the fiscal year of the correct amount of tax
distributions to be made by the Funds to the Partnership and Tax
Distributions to be made by the Partnership to its Partners.
9.3 ADDITIONAL DISTRIBUTIONS. All additional distributions, other
------------------------
than Liquidating Distributions, shall be made as follows:
(a) As long as any Partner has a positive balance in his
Capital Account, all cash or property received during the fiscal year by the
Partnership which is attributable to cumulative Net Gain (e.g., in excess of
prior Net Loss) or Short-Term Income that have been allocated in accordance
with Article VIII shall be distributed to the extent possible to the Partners
in proportion to the respective allocations of each such item under Article
VIII. Cash or property received which is not attributable to Net Gain or
Short-Term Income shall be distributed to the Partners in proportion to their
respective Capital Accounts.
(b) If no Partner has a positive balance in his Capital
Account, distributions shall be made to all Partners in proportion to their
respective Percentage Interests.
9.4 OPERATIONAL RULES.
-----------------
(a) For purposes of Section 9.3, the Capital Account balances
of the Partners shall be adjusted, prior to determining the amount of any
distribution provided for therein, to reflect all prior Partnership
distributions and all distributions made contemporaneously with the
distributions provided for in Section 9.3, as well as all Partnership Net
Gain or Net Loss attributable to any distributions previously or
contemporaneously made in kind.
- 13 -
19
(b) The valuation of securities distributed in kind shall be
made in the manner provided in Article X. Each class of securities to be
distributed in kind shall be distributed to the Partners in proportion to
their respective shares of the entire amount to be distributed (determined as
provided in Section 9.3 or, with respect to Liquidating Distributions,
Section 12.2), except to the extent that a disproportionate distribution of
such securities is necessary in order to avoid distributing fractional
shares. For purposes of the preceding sentence, each lot of stock or other
securities having a separately identifiable tax basis or holding period shall
be treated as a separate class of securities.
9.5 TAX WITHHOLDING. If the Partnership incurs a tax withholding
---------------
obligation with respect to any Partner, any amount required to be withheld by
the Partnership with respect to such Partner shall be treated for all
purposes of this Agreement as if it had been transferred to such Partner by
the Partnership as an interest-free advance. Amounts treated as advanced to
any Partner pursuant to this Section 9.5 shall be repaid by such Partner to
the Partnership within thirty (30) days after the Partnership delivers a
written request to such Partner for such repayment; provided, however, that
-------- -------
if any such repayment is not made, the Partnership shall collect such unpaid
amounts from any Partnership distributions that otherwise would be made to
such Partner. Any part of such withheld amount not collected by the
Partnership from such distributions shall be charged to such Partner's
Capital Account at such time as the General Partner in its sole discretion
shall determine, but in no event later than the time immediately preceding
the Partnership's final Liquidating Distribution to such Partner.
9.6 CERTAIN DISTRIBUTIONS PROHIBITED. Anything in this Article IX to
--------------------------------
the contrary notwithstanding, all Partnership distributions shall be subject
to the following limitations:
(a) No distribution shall be made to any Partner if, and to the
extent that, such distribution would not be permitted under Section 17-607(a)
of the Delaware Act.
(b) No distribution other than a Tax Distribution shall be made
to any Partner to the extent that such distribution, if made, would cause the
deficit balance, if any, in the Capital Account of such Partner (determined
without regard to any allocations made pursuant to Section 8.4(c)) to exceed
such Partner's Restoration Amount.
9.7 CONSENT TO DISTRIBUTIONS. Each Partner, by becoming a Partner,
------------------------
consents to any such distribution hereafter made or omitted to be made to the
Partners or any of them in accordance with this Article IX.
- 14 -
20
ARTICLE X - VALUATION OF PARTNERSHIP ASSETS.
-------------------------------------------
10.1 VALUATION BY GENERAL PARTNER. Whenever valuation of Partnership
----------------------------
assets or net assets is required by this Agreement, the fair market value of
such assets shall be determined by the General Partner in good faith.
10.2 GOODWILL. The Partnership's name and goodwill shall, as among
--------
the Partners, be deemed to have no value and shall belong to the Partnership
or any successor thereof, and no Partner shall have any right or claim
individually to the use thereof. Upon termination of the Partnership, all
rights to the name of the Partnership and any goodwill associated with that
name shall be assigned to the General Partner.
ARTICLE XI - DURATION OF PARTNERSHIP.
------------------------------------
11.1 TERM OF PARTNERSHIP. The Partnership shall continue until
-------------------
December 31, 2003, unless extended as provided in Section 11.4, or unless
sooner dissolved as provided in Sections 11.2 or 11.3 or by operation of law.
11.2 DISSOLUTION UPON WITHDRAWAL OF GENERAL PARTNER. The Partnership
----------------------------------------------
shall be dissolved upon the occurrence with respect to a General Partner of
any of the "events of withdrawal" described in Section 17-402 of the Delaware
Act, provided, that the Partnership shall not be dissolved and the business
of the Partnership shall continue to be carried on if there is at least one
remaining general partner, and, provided, further, that the Partnership shall
not be dissolved if all the Limited Partners agree in writing to continue the
business of the Partnership and appoint one or more Persons to be the general
partner in accordance with Section 17-801 of the Delaware Act.
11.3 NO DISSOLUTION ON EVENTS AFFECTING LIMITED PARTNERS. The
---------------------------------------------------
Partnership shall not be dissolved in the event of the dissolution, death,
bankruptcy, substitution or admission of any Limited Partner.
11.4 EXTENSION OF TERM. It is contemplated by the Partners that the
-----------------
term of the Partnership shall terminate on December 31, 2003, unless sooner
terminated pursuant to Section 11.2 or by operation of law. Notwithstanding
the foregoing, the term of the Partnership shall be extended for up to two
additional one-year periods if the term of either Fund is similarly extended
pursuant to its Fund Partnership Agreement.
ARTICLE XII - LIQUIDATION OF PARTNERSHIP INTERESTS.
--------------------------------------------------
12.1 GENERAL PROVISIONS. At dissolution, the Partnership shall be
------------------
liquidated in an orderly manner. The General Partner shall be the liquidator
to wind up the affairs of the Partnership pursuant to this Agreement;
provided that, if
- 15 -
21
there shall be no remaining general partner at that time, 66-2/3% in interest of
the Limited Partners may designate one or more other persons to act as the
liquidator(s). Any such liquidator, other than the General Partner, shall be a
"liquidating trustee" within the meaning of Section 17-101(8) of the Delaware
Act.
12.2 LIQUIDATING DISTRIBUTIONS. The liquidator(s) shall satisfy or
-------------------------
provide for the satisfaction of the Partnership's liabilities and obligations
to creditors. Any Net Gain or Loss realized in connection with the
liquidation of the Partnership shall be allocated among the Partners pursuant
to Article VIII, and the remaining assets of the Partnership shall then be
distributed to the Partners in proportion to the positive balances in their
respective Capital Accounts (and, if a distribution in kind is to be made,
after allocating any Net Gain or Loss attributable to such distribution). In
performing their duties, the liquidator(s) are authorized to sell, exchange
or otherwise dispose of the assets of the Partnership in such reasonable
manner as the liquidator(s) shall determine to be in the best interest of the
Partners. During the liquidation of the Partnership, the liquidators(s)
shall furnish to the Partners the financial statements and other information
specified in Article XVIII.
12.3 EXPENSES OF LIQUIDATOR(S). The expenses incurred by the
-------------------------
liquidator(s) in connection with winding up the Partnership, all other losses
or liabilities of the Partnership incurred in accordance with the terms of
this Agreement, and reasonable compensation for the services of the
liquidator(s) shall be borne by the Partnership.
12.4 DURATION OF LIQUIDATION. A reasonable time shall be allowed for
-----------------------
the winding up of the affairs of the Partnership in order to minimize any
losses otherwise attendant upon such a winding up, provided that the
liquidator(s) shall use their best efforts to carry out the liquidation in
conformity with the timing requirements of Treasury Regulation Section
1.704-l(b)(2)(ii)(g).
-
12.5 DUTY OF CARE. The liquidator(s) shall not be liable to any
------------
Partner for any loss attributable to any act or omission of the liquidator(s)
taken in good faith in connection with the liquidation of the Partnership and
distribution of its assets. The liquidator(s) may consult with counsel and
accountants with respect to liquidating the Partnership and distributing its
assets and shall be justified in acting or omitting to act in accordance with
the advice or opinion of such counsel or accountants, provided they shall
have been selected with reasonable care.
- 16 -
22
12.6 NO LIABILITY FOR RETURN OF CAPITAL.
----------------------------------
(a) The liquidator(s), the General Partner and their respective
officers, directors, agents, partners and Affiliates shall not be personally
liable for the return of the capital contributions of any Partner.
(b) If, after the Partnership has made its final Liquidating
Distribution, the General Partner's Capital Account is negative, then,
notwithstanding the foregoing, the General Partner shall return to the
Partnership part or all of of the distributions received by it pursuant to
Article IX or this Article XII in an aggregate amount equal to such deficit
but not in excess of such Partner's Restoration Amount. Returns made by a
Partner pursuant to this Section 12.6 shall be made in cash. The Partners
shall use best efforts to make any such returns promptly and in any event in
conformity with the timing requirements of Treasury Regulation Section
1.704-l(b)(2)(ii)(g). Amounts repaid by the Partners pursuant to this
-
Section 12.6 shall be paid to a Fund in satisfaction of the Partnership's
obligation to restore a deficit in its capital account as maintained by such
Fund, paid to other creditors of the Partnership or distributed to Partners with
positive balances in their Capital Accounts in proportion to such balances.
ARTICLE XIII - LIMITATION ON TRANSFER OF
----------------------------------------
INTERESTS OF LIMITED PARTNERS OR RETIRED PARTNERS.
-------------------------------------------------
13.1 CONSENT OF GENERAL PARTNER TO TRANSFERS. The prior written
---------------------------------------
consent of the General Partner, which consent may be granted or withheld in
the General Partner's absolute discretion, shall be required for any Transfer
of part or all of any Limited Partner's or Retired Partner's interest in the
Partnership.
13.2 OPINION OF COUNSEL. Any Transfer shall be made only upon receipt
------------------
by the Partnership of a written opinion of counsel for the Partnership or of
other counsel reasonably satisfactory to the Partnership (which opinion shall
be obtained at the expense of the transferor) that such Transfer will not
result in (a) the Partnership or the General Partner being subjected to any
additional regulatory requirements, (b) a violation of applicable law or this
Agreement, (c) the Partnership being classified as an association taxable as
a corporation, (d) the Partnership becoming subject to tax as a corporation
pursuant to Section 7704 of the Code, or (e) the Partnership being deemed
terminated pursuant to Section 708 of the Code.
13.3 EXPENSES. The transferor of any interest in the Partnership
--------
hereby agrees to reimburse the Partnership, at the request of the General
Partner, for any expenses reasonably incurred by the Partnership in the
course of consummating such Transfer.
- 17 -
23
13.4 SUBSTITUTION OF LIMITED PARTNERS OR RETIRED PARTNERS. Without
----------------------------------------------------
the consent of the General Partner and the aforesaid written opinion of
counsel, no transferee of a Partnership interest shall be admitted as a
substituted Limited Partner or Retired Partner. Any transferee of a
Partnership interest transferred in accordance with the provisions of this
Article XIII shall be admitted as a substituted Limited Partner or Retired
Partner upon the later of the execution of the required amendment to this
Agreement or the effective date set forth in such amendment, and such
transferee shall succeed to the rights and liabilities of the transferor
Limited Partner or Retired Partner, and the Capital Account and Percentage
Interest of the transferor shall become the Capital Account and Percentage
Interest, respectively, of the transferee, to the extent of the interest
transferred.
13.5 COVENANTS OF LIMITED PARTNERS AND RETIRED PARTNERS.
--------------------------------------------------
(a) Except in accordance with the provisions of this Article
XIII, each Limited Partner and Retired Partner agrees with all other Partners
that it shall not make any Transfer of all or any part of its interest in the
Partnership.
(b) Each Limited Partner and Retired Partner, by its execution
of this Agreement, thereby agrees and consents to the admission of any
substituted Limited Partner or Retired Partner pursuant to the terms of this
Article XIII. Any transferee of a Partnership interest shall execute a
power-of-attorney as provided in Section 20.2 and such other documents as the
General Partner may reasonably request to effect such substitution, including
an assumption of all obligations of the transferor Limited Partner or Retired
Partner under this Agreement.
(c) Any attempted Transfer of a Limited Partner's or Retired
Partner's interest without compliance with this Agreement shall be void. In
the event of any transfer which shall result in multiple ownership of any
Limited Partner's or Retired Partner's interest in the Partnership, the
General Partner may require one or more trustees or nominees to be designated
as representing a portion of or the entire interest transferred for the
purpose of receiving all notices which may be given, and all payments which
may be made, under this Agreement and for the purpose of exercising all
rights which the transferor as a Limited Partner or Retired Partner has
pursuant to the provisions of this Agreement. Every Transfer shall be
subject to all of the terms, conditions, restrictions and obligations of this
Agreement.
- 18 -
24
ARTICLE XIV - WITHDRAWAL OF PARTNERSHIP INTERESTS.
-------------------------------------------------
14.1 WITHDRAWALS GENERALLY PROHIBITED. Except as otherwise
--------------------------------
specifically provided for in this Agreement, no Partner shall have the right
to withdraw its capital and profits from the Partnership.
14.2 WITHDRAWAL UPON DEATH, DISABILITY, BANKRUPTCY OR TERMINATION OF
---------------------------------------------------------------
EMPLOYMENT. In the event of (i) the occurrence with respect to any Limited
----------
Partner of an event described in Section 17-402(4) or (6) of the Delaware Act
as in effect on the date hereof, (ii) if any Limited Partner shall become
disabled, or (iii) if such Limited Partner shall no longer be an employee,
consultant or member of the Board of Directors of the General Partner or any
Affiliate thereof, such Limited Partner shall thereupon for purposes of this
Agreement be deemed to have withdrawn as of the date thereof, and in such
event such Limited Partner's interest in the Partnership as a Limited Partner
shall automatically be converted into a Retired Partner's interest in
accordance with the provisions of Article XV. For purposes of this
Agreement, a Limited Partner shall be deemed to be disabled if he is unable
to perform his or her business obligations for any 180 days out of any
365-day period.
ARTICLE XV - RETIRED LIMITED PARTNERS.
-------------------------------------
15.1 GENERAL. A Limited Partner who withdraws, or the personal
-------
representative or estate of a Limited Partner who shall be deemed to have
withdrawn, shall retain an interest in the Partnership as a Retired Partner;
such former Limited Partner's interest in the Partnership as a Limited
Partner shall be automatically converted into a Retired Partner's Interest;
and such Person shall be considered a Retired Partner for all purposes under
the terms of this Agreement, provided, however, that a Retired Partner shall
-------- -------
retain only the portion of his or her Percentage Interest indicated on
Schedule B, depending on whether such withdrawal is due to (i) death or
----------
disability ("Category A"), or (ii) withdrawal for any other reason (Category
B").
Notwithstanding the foregoing, the General Partner may accelerate the
vesting schedule described above for any Retired Partner who is deemed to
have withdrawn from the Partnership, but shall be under no obligation to do
so, and may in its discretion do so for one or more Retired Partners and not
for all Retired Partners. The table set forth above may not be altered with
respect to any particular Limited Partner without such Partner's prior
written consent.
15.2 ADJUSTMENTS TO REFLECT RETIREMENT.
---------------------------------
(a) The portion of the Percentage Interest of a Limited Partner
which is not retained under subsection 15.1 shall
- 19 -
25
be allocated to the General Partner, unless the General Partner in its sole
discretion decides to allocate such portion of Percentage Interest to one or
more Partners in some other manner.
(b) In connection with any such adjustment of Percentage
Interests, the General Partner in its discretion may cause subsequent
allocations to be made in the manner described in Section 8.5.
15.3 RETIRED PARTNER PARTICIPATION. A Retired Partner shall take no
-----------------------------
part in the management, policy or control of the Partnership and shall have
no power or authority to undertake any activities on behalf of the
Partnership or to sign for or to bind the Partnership. Any Retired Partner
shall be bound by the terms of this Agreement and by all action taken by the
General Partners or the Limited Partners. No Retired Partner, or trust for
the benefit of a Retired Partner or the children of a Retired Partner, shall
participate in any consent of the Limited Partners for any purpose hereunder.
ARTICLE XVI - LIMITATION ON TRANSFER OF
---------------------------------------
INTEREST OF THE GENERAL PARTNER.
-------------------------------
The General Partner may transfer its entire interest to a successor
General Partner which is an Affiliate of the General Partner, provided,
--------
further, that any such transfer shall be made only if it results in no
-------
material adverse tax consequences to the Partnership, its Partners or the
Funds or their partners. The General Partner shall not otherwise assign,
pledge, mortgage, hypothecate, sell or otherwise dispose of or encumber all
or any part of its general partnership interest. Any attempted transfer of
the General Partner's interest in violation of this Article XVI shall be
void.
ARTICLE XVII - INDEMNIFICATION.
------------------------------
17.1 GENERAL PROVISIONS. The General Partner, each Limited Partner
------------------
and Retired Partner and each officer, director, employee and agent of the
General Partner (each an "Indemnified Party" and collectively, the
"Indemnified Parties") shall be indemnified by the Partnership (only out of
Partnership assets, including the proceeds of liability insurance) against
any claim, demand, controversy, dispute, cost, loss, damage, expense
(including reasonable attorneys' fees), judgment and/or liability incurred by
or imposed upon such Indemnified Party in connection with any action, suit or
proceeding (including any proceeding before any administrative or legislative
body or agency), to which such Indemnified Party may be made a party or
otherwise involved or with which such Indemnified Party shall be threatened,
by reason of such Indemnified Party's being at the time the cause of action
arose or thereafter, the General Partner (including without limitation the
General Partner acting as Tax Matters Partner) or a current or former
director, officer,
- 20 -
26
employee or agent of the General Partner (provided, with respect to any
Indemnified Party other than the General Partner, that in such capacity such
Indemnified Party was performing services on behalf of the Partnership or the
Fund), a Limited Partner performing services for the Partnership at the
request of the General Partner, or a director, officer, partner or employee
of any other organization in which the Partnership or the Fund owns an
interest (or has owned an interest at any time during the full calendar year
preceding the date on which the acts or omissions giving rise to such
Indemnified Party's claim for indemnity hereunder first occurred) or of which
the Partnership or the Fund is a creditor (to the extent such Indemnified
Party has not been indemnified by such other organization), which other
organization such Indemnified Party serves or has served as director,
officer, partner or employee at the request of the Partnership or the Fund
(whether or not such Indemnified Party continues to be a director, officer,
employee or agent of the General Partner or an officer, director, partner or
employee of such other organization at the time such action, suit or
proceeding is brought or threatened), except with respect to matters as to
which such Indemnified Party shall have been finally adjudicated in any such
action, suit or proceeding not to have acted in good faith or to have acted
with gross negligence or a willful disregard of such Indemnified Party's
duties, or in breach of such Indemnified Party's fiduciary obligations, or,
with respect to any criminal action or proceeding, to have had reasonable
cause to believe such Indemnified Party's conduct was unlawful. In the event
of settlement of any action, suit or proceeding brought or threatened, such
indemnification shall apply to all matters covered by the settlement except
for matters as to which the Partnership is advised by independent counsel
(who may be counsel to the Partnership) that the Person seeking
indemnification, in the opinion of counsel, did not act in good faith or
acted with gross negligence or a willful disregard of such Person's duties,
or in breach of such Person's fiduciary obligations, or, with respect to any
criminal action or proceeding, that the Person seeking indemnification had
reasonable cause to believe such Person's conduct was unlawful. The
foregoing right of indemnification shall be in addition to any rights to
which an Indemnified Party may otherwise be entitled and shall inure to the
benefit of the executors, administrators, personal representatives,
successors or assigns of each such Indemnified Party. Notwithstanding the
foregoing, no payments shall be made with respect to a claim for
indemnification hereunder unless the Indemnified Party has made reasonable
efforts to reduce the amount of an indemnified loss by seeking contribution
from other sources.
17.2 ADVANCE PAYMENT OF EXPENSES. The Partnership shall pay the
---------------------------
expenses incurred by an Indemnified Party in defending a civil or criminal
action, suit or proceeding, or in opposing any claim arising in connection
with any potential or threatened civil or criminal action, suit or
proceeding, in
- 21 -
27
advance of the final disposition of such action, suit or proceeding, provided
that the Indemnified Party provides a legally enforceable undertaking to repay
such payment if such Indemnified Party shall be determined not to be entitled
thereto as provided herein.
17.3 INSURANCE. The General Partner, on behalf of the Partnership,
---------
may cause the Partnership to purchase and maintain insurance, at the expense
of the Partnership and to the extent available, for the protection of any
Indemnified Party against any liability incurred by such Person, whether or
not the Partnership has the power to indemnify such Person against such
liability.
17.4 LIMITATION OR EXPANSION BY LAW. If the General Partner or the
------------------------------
Partnership is subject to any federal or state law, rule or regulation which
restricts the extent to which any Person may be exonerated or indemnified by
the Partnership, then the indemnification provisions set forth in this
Article XVII and the exoneration provisions set forth in Section 3.5 shall be
deemed to be amended, automatically and without further action by the General
Partner or the Limited Partners, to conform to such restrictions on
exoneration or indemnification as set forth in such applicable federal or
state law, rule or regulation. If any law, statute, rule or regulation of
any jurisdiction by which the Partnership may be governed is amended in the
future to enlarge the scope of indemnification or eliminate or reduce the
liability of any Indemnified Party, then this Article XVII and Section 3.5
may be amended and modified at the sole discretion of the General Partner
without any further action by the Limited Partners to broaden correspondingly
the exoneration or indemnification provided hereunder. The rights to
indemnification and advance payment of expenses conferred by this Article
XVII shall not be exclusive of any other right which any Indemnified Party
may have or hereafter acquire under any law, statute, rule, regulation,
charter document, by-law, contract or agreement.
ARTICLE XVIII - ACCOUNTING, RECORDS AND REPORTS.
-----------------------------------------------
18.1 FISCAL YEAR. The fiscal year of the Partnership shall be the
-----------
period ending on December 31.
18.2 KEEPING OF ACCOUNTS AND RECORDS. At all times the General
-------------------------------
Partner shall cause to be kept proper and complete books of account, in which
shall be entered fully and accurately the transactions of the Partnership.
Such books of account (which shall be kept on the accrual method of
accounting), together with (a) an executed copy of this Agreement (and any
amendments hereto), (b) the Certificate of Limited Partnership of the
Partnership (and any amendments thereto); (c) executed copies of any powers
of attorney pursuant to which any certificate has been executed by the
Partnership; (d) a current list of the full name, taxpayer identification
number and last known address of each
- 22 -
28
Partner set forth in alphabetical order; (e) copies of all federal, state and
local tax returns, if any, filed by the Partnership for each of the prior
three years; and (f) all financial statements of the Partnership for each of
the prior three years, shall at all times be maintained at the principal
office of the Partnership and shall be open to inspection by the Partners or
their duly authorized representatives.
18.3 INSPECTION RIGHTS. At any time while the Partnership continues
-----------------
and until its complete liquidation (but only during reasonable business
hours), each Limited Partner and Retired Partner (or the designee thereof)
may fully examine and audit the Partnership's books, records, accounts and
assets, including bank balances, and may make, or cause to be made, any
examination or audit at such Partner's expense. Each Limited Partner and
Retired Partner (or the designee thereof) may, during normal business hours,
examine, or request that the General Partner furnish, such additional
information as is reasonably necessary to enable the requesting Partner (or
the designee thereof) to review the state of the affairs of the Partnership.
Notwithstanding the foregoing, the management of the affairs of the
Partnership shall be in the complete control of the General Partner and the
General Partner shall have the benefit of the confidential information
provisions of Section 17-305(b) of the Delaware Act, and provided, further,
-------- -------
that no Limited Partner shall be entitled to inspect any matter which the
General Partner considers confidential concerning another Limited Partner,
including but not limited to the supplements referred to on Schedule A.
18.4 ANNUAL FINANCIAL STATEMENTS. The General Partner shall transmit
---------------------------
to each Partner, as soon as practicable and in any event within one hundred
and twenty (120) days after the close of each fiscal year, the financial
statements of the Partnership for such fiscal year. Such financial
statements shall include balance sheets of the Partnership as of the end of
such fiscal year and of the preceding fiscal year, statements of income and
loss of the Partnership for such fiscal year and for the preceding fiscal
year, all prepared in accordance with tax accounting principles consistently
applied in accordance with the terms of this Agreement. A separate schedule
of changes in each particular Partner's Capital Account shall also be
provided to each such Partner. The General Partner shall also transmit to
each Partner, as soon as practicable after the close of each fiscal year and
in any event by April 15, such Partner's Schedule K-1 (Form 1065) or an
equivalent report indicating such Partner's share of all items of income or
gain, expense, loss or other deduction and tax credit of the Partnership for
such year for federal income tax purposes, as well as the status of his
Capital Account as of the end of such year, and such additional information
as he reasonably may request to enable him to complete his tax returns or to
fulfill any other reporting requirements.
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29
18.5 ACCOUNTING METHOD. The Partnership may use the the accrual
-----------------
method of accounting (or, subject to Section 448 of the Code, the cash method
of accounting) for federal income tax purposes.
ARTICLE XIX - WAIVER AND AMENDMENT.
----------------------------------
Except as otherwise provided in this Agreement, the terms and
provisions of this Agreement may be waived, modified or amended only with the
written consent of the General Partner and of at Limited Partners holding at
least fifty-one percent (51%) of the Percentage Interests held by all Limited
Partners. No amendment shall, however, (a) enlarge the obligations of any
Partner under this Agreement without the written consent of such Partner, (b)
dilute the relative interest of any Partner in the profits or capital of the
Partnership or in Partnership allocations and distributions attributable to
the interest owned by such Partner without the written consent of such
Partner (except such dilution as may result from additional Subscriptions
from the Partners or the admission of additional Limited Partners in
accordance with the terms hereof), or (c) alter or waive the terms of this
Article XIX without the consent of any Partner who would be adversely
affected thereby. The General Partner shall promptly furnish copies of any
amendments to this Agreement to all Partners.
ARTICLE XX - GENERAL PROVISIONS.
-------------------------------
20.1 NOTICES. Except where otherwise specifically provided in this
-------
Agreement, all notices, requests, consents, approvals and statements shall be
in writing and shall be deemed to have been properly given by personal
delivery or if mailed from within the United States by first class U.S. mail,
postage prepaid, or if sent by prepaid courier service, prepaid telegram,
telex or electronic facsimile transmission, addressed in each case, if to the
Partnership, at CityPlace II, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇, fax number (▇▇▇) ▇▇▇-▇▇▇▇, and if to any Partner, to the address
of such Partner as set forth in Schedule A or in the instrument pursuant to
----------
which it became a Partner or, in each case, to such other address or
addresses as the addressee may have specified by written notice as aforesaid
to the other parties.
20.2 POWER OF ATTORNEY.
-----------------
(a) Each of the Partners hereby constitutes and appoints the
General Partner as its true and lawful attorney-in-fact, in its name, place
and stead to make, execute, sign, acknowledge and file (1) a Certificate of
Limited Partnership under the laws of the State of Delaware or any other
jurisdiction, any amendment or restatement to any such Certificate of Limited
Partnership and any other document,
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30
instrument or certificate which may from time to time be required by law to
effectuate, implement and continue the valid and subsisting existence of the
Partnership, or any other instrument, certificate or document required from
time to time to admit a Partner, to effect its substitution as a Partner, to
effect the substitution of the Partner's assignee as a Partner, or to reflect
any action of the Partners provided for in this Agreement; and (2) any other
instrument, certificate or document as may be required or appropriate under
the laws, regulations or procedures of the United States, any state or any
governmental entity in any jurisdiction in which the Partnership is
conducting or intends to conduct its activities, provided all such
instruments, certificates and other documents referred to in clauses (1) and
(2) above are in accordance with the terms of this Agreement as then in
effect. Copies of all such instruments, certificates and other documents
shall be sent to all Partners.
(b) Each of the Partners is aware that the terms of this
Agreement permit certain amendments to the Certificate of Limited Partnership
and this Agreement to be effected and certain other actions to be taken by or
with respect to the Partnership, in each case with the approval or by the
vote of less than all the Partners. If, as and when (1) an amendment of the
Certificate of Limited Partnership or this Agreement is proposed or an action
is proposed to be taken by or with respect to the Partnership which does not
require, under the terms of this Agreement, the approval of all of the
Partners, (2) Partners holding the interest in the Partnership specified in
this Agreement as being required for such amendment or action have approved
such amendment or action in the manner contemplated by this Agreement and (3)
a Partner has failed or refused to approve such amendment or action
(hereinafter referred to as a non-consenting Partner), each non-consenting
Partner agrees that the special attorney specified above, with full power of
substitution, is hereby authorized and empowered to execute, acknowledge,
make, swear to, verify, deliver, record, file and/or publish, for and on
behalf of such non-consenting Partner, and in its name, place and stead, any
and all instruments and documents which may be necessary or appropriate to
permit such amendment to be lawfully made or action lawfully taken. Each
Partner is fully aware that it and each other Partner has executed this
special power of attorney, and that each Partner will rely on the
effectiveness of such powers with a view to the orderly administration of the
Partnership's affairs.
(c) The foregoing grant of authority (1) is a special power of
attorney coupled with an interest in favor of the General Partner and as such
shall be irrevocable and shall survive the death or disability of a Partner
that is a natural person and the merger, dissolution or other termination of
the existence of a Partner that is a corporation, association, partnership or
trust, and (2) shall survive the assignment by the
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31
Partner of the whole or any portion of its interest, except that where the
assignee of the whole thereof has furnished a power of attorney, this power
of attorney shall survive such assignment for the sole purpose of enabling
the General Partner to execute, acknowledge and file any instrument necessary
to effect any permitted substitution of the assignee for the assignor as a
Partner and shall thereafter terminate.
(d) The General Partner shall require a similar power of
attorney to be executed by a transferee of a Partner as a condition of its
admission as a substituted Partner.
20.3 WAIVER OF PARTITION. Each Partner hereby irrevocably waives any
-------------------
and all rights that it may have to maintain an action for partition of any of
the Partnership's property.
20.4 ADDITIONAL DOCUMENTS. Each Partner hereby agrees to execute all
--------------------
certificates, counterparts, amendments, instruments or documents that may be
required by laws of the various states or other jurisdictions in which the
Partnership conducts its activities, to conform with the laws of such states
or other jurisdictions governing limited partnerships.
20.5 BINDING ON SUCCESSORS. This Agreement shall be binding upon and
---------------------
it shall inure to the benefit of the respective heirs, successors, assigns
and legal representatives of the parties hereto.
20.6 COUNTERPARTS. This Agreement or any amendment hereto may be
------------
signed in any number of counterparts, each of which shall be an original, but
all of which taken together shall constitute one agreement (or amendment, as
the case may be).
20.7 VOTING. Any vote or other action required or permitted to be
------
taken by this Agreement may be taken by written consent signed by not less
than the requisite number of parties required or permitted to take such vote
or other action.
20.8 GOVERNING LAW. This Agreement shall be governed by and construed
-------------
in accordance with the internal laws of the State of Delaware.
20.9 SECURITIES ACT MATTERS. Each Partner understands that in
----------------------
addition to the restrictions on transfer contained in this Agreement, it must
bear the economic risks of its investment for an indefinite period because
the Partnership interests have not been registered under the Securities Act
and, therefore, may not be sold or otherwise transferred unless they are
registered under the Securities Act or an exemption from such registration is
available. Each Partner agrees with all other Partners that it will not sell
or otherwise transfer its interest in the Partnership unless such interest
has been so registered or in the
- 26 -
32
opinion of counsel for the Partnership, or of other counsel reasonably
satisfactory to the Partnership, such an exemption is available.
20.10 AUTHORITY OF GENERAL PARTNER. No Person dealing with the
----------------------------
General Partner shall be required to determine its authority to make any
commitment or undertaking on behalf of the Partnership or to determine any
fact or circumstance bearing upon the existence of its authority and,
notwithstanding anything to the contrary contained herein, the acts of the
General Partner in carrying on the activities of the Partnership as
authorized herein shall bind the Partnership.
20.11 CONTRACT CONSTRUCTION. Whenever the content of this Agreement
---------------------
permits, the masculine gender shall include the feminine and neuter genders,
and reference to singular or plural shall be interchangeable with the other.
The invalidity or unenforceability of any one or more provisions of this
Agreement shall not affect the other provisions, and the Agreement shall be
construed in all respects as if any such invalid or unenforceable
provision(s) were omitted. References in this Agreement to particular
sections of the Code or the Delaware Act shall be deemed to refer to such
sections as they may be amended after the date of this Agreement.
20.12 SECTION HEADINGS. Captions in this Agreement are for convenience
----------------
only and do not define or limit any term of this Agreement.
[Remainder of this page intentionally left blank.]
- 27 -
33
IN WITNESS WHEREOF, the undersigned have executed this Amended and
Restated Limited Partnership Agreement as of the day, month and year first
above written.
GENERAL PARTNER:
CONNING & COMPANY
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------
Title: Senior Vice President
LIMITED PARTNERS:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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34
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
* * *
Schedule for the general partner and for each limited partner, listing the
name, address, total subscription amount and percentage interest of such
general or limited partner.
- 29 -
35
Schedule B
----------
Period After Receipt
of Portion of
Percentage Interest Category A - Category B -
During Which If Withdrawal is Due to If Withdrawal is
Retired Partner Death or Disability - For Any Other Reason -
is Deemed to Have Portion of Percentage Portion of Percentage
Withdrawn. Interest Retained Interested Retained
-------------------- ----------------------- ----------------------
Before three years 0% 0%
On or after three years
and before four years 30% 15%
On or after four years an additional an additional
and before five years 30% 15%
On or after five years an additional an additional
and before six years 30% 15%
On or after six years an additional
and before seven years 100% 15%
On or after seven years 100% 100%
To the extent a Retired Partner received portions of his or her Percentage
Interest on more than one date, such percentages retained above shall be
separately applied to each portion based on its date of receipt, to
produce a total retained Percentage Interest. In any event, and
notwithstanding the foregoing schedules, Percentage Interests shall be
100% vested on December 28, 2003.
- 33 -
36
Schedule C
----------
General Partner's Percentage
Allocation Period Allocation Date Interest Reduced To:
----------------- --------------- ----------------------------
Inception By April 30, 1994 88%
First Year By January 31, 1995 76%
Second Year By January 31, 1996 64%
Third Year By January 31, 1997 52%
Fourth Year By January 31, 1998 40%
- 34 -
37
APPENDIX A
----------
TABLE OF DEFINITIONS
--------------------
"AFFILIATE" shall mean, with respect to the Person to which it refers,
---------
a Person that directly or indirectly through one or more intermediaries,
controls or is controlled by, or is under common control with, such subject
Person; provided, however, that all partners of the Partnership and all
-------- -------
officers, directors and employees of the General Partner shall be deemed to
be Affiliates of the Partnership.
"CAPITAL ACCOUNT" shall have the meaning set forth in Section 7.1.
---------------
"CODE" shall mean the Internal Revenue Code of 1986 and the rules and
----
regulations promulgated thereunder, as amended from time to time.
"COST" shall mean, with respect to Partnership assets and unless the
----
context otherwise requires, the Partnership's adjusted tax basis of such
assets for federal income tax purposes, provided that (i) if the Partnership
has made an election under Section 754 of the Code, such tax basis shall be
determined after giving effect to adjustments made under Section 734 of the
Code but without regard to adjustments made under Section 743 of the Code;
and (ii) the Cost of any securities or other property received by the
Partnership in distributions made by the Fund shall be deemed to equal the
fair market value of such property, as determined pursuant to the Fund
Partnership Agreement, as of the date such property is distributed by the
Fund.
"DELAWARE ACT" shall mean the Delaware Revised Uniform Limited
------------
Partnership Act, as amended from time to time.
"DOMESTIC FUND" shall mean Conning Insurance Capital Limited
-------------
Partnership III, a Delaware limited partnership.
"FUND(S)" shall mean either or both of the Domestic Funds and the
-------
Offshore Fund.
"FUND PARTNERSHIP AGREEMENT(S)" shall mean one or more of the limited
-----------------------------
partnership agreements of the Domestic Fund and the Offshore Fund.
"GENERAL PARTNER" shall mean Conning & Company, a Connecticut
---------------
corporation, that serves as the sole general partner of the Partnership, and
any successor or thereto pursuant to the provisions of Article XVI.
"INDEMNIFIED PARTIES" shall have the meaning set forth in Section 17.1.
-------------------
-i-
38
"ISSUANCE ITEMS" shall have the meaning set forth in Section 8.6(b).
--------------
"LIMITED PARTNERS" shall mean those Persons listed in Schedule A hereto
---------------- ----------
as limited partners, together with any additional or substituted limited
partners admitted to the Partnership after the date hereof. Whether a
majority in interest (or any other specified percentage in interest) consents
to any action permitted or required of the Limited Partners under this
Agreement shall be determined as provided in Section 20.7.
"LIQUIDATING DISTRIBUTION" shall mean any distribution made by the
------------------------
Partnership after the latest to occur of (a) the Partnership's dissolution,
determined pursuant to Article XIII, and (b) the date on which the
Partnership has received its final distribution from the Fund.
"NET GAIN OR LOSS" shall mean, with respect to any fiscal period, the
----------------
sum of (a) all amounts allocated for such fiscal period to the Partnership
pursuant to the Fund Partnership Agreement to the Partnership in its capacity
as the general partner of the Fund, (b) net gain or loss from the sale or
exchange of the Partnership's capital assets during such fiscal period, (c)
gain or loss deemed to have been realized by the Partnership, pursuant to
Section 7.2, on a distribution in kind of its assets during such fiscal
period, and (d) other items of income, gain, loss, deduction and expense of
the Partnership for such fiscal period that are not included in (a), (b) or
(c), including any income which is exempt from federal income tax, all
Partnership losses and all expenses properly chargeable to the Partnership,
whether deductible or non-deductible and whether described in Section
705(a)(2)(B) of the Code, treated as so described pursuant to Treasury
Regulation Section 1.704-l(b)(2)(iv)(i), or otherwise except for Issuance
------ ---
Items. Net Gain or Loss shall be determined in accordance with tax
accounting principles rather than generally accepted accounting principles.
"OFFSHORE FUND" shall mean Conning Insurance Capital International
-------------
Partners III, a Cayman Islands limited partnership.
"PARTNERS" shall mean the General Partner and the Limited Partners.
--------
"PARTNERSHIP" shall mean Conning Investment Partners Limited
-----------
Partnership III.
"PERSON" shall mean any individual, partnership, corporation, trust or
------
other entity.
"PERCENTAGE INTEREST" shall mean, with respect to any Partner and at
-------------------
any time, the amount set forth at such time opposite such Partner's name in
Schedule A under the heading "Percentage Interest."
----------
-ii-
39
"RESTORATION AMOUNT" shall mean, with respect to any Partner and at any
------------------
time, (a) any amount of such Partner's Subscription that such Partner has not
contributed in cash to the Partnership as of such time; and (b) in the case
of the General Partner only, any amounts the General Partner is required to
restore to the Funds pursuant to Section 12.6.
"RETIRED PARTNER" shall have the meaning set forth in Section 15.1.
---------------
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended from
--------------
time to time.
"SHORT-TERM INCOME" shall mean interest and dividend income earned on
-----------------
temporary investment of capital contributions or distributions received from
the Fund(s) which are held by the Partnership pending investment in the
Fund(s), disbursement for expenses or distribution to the Partners.
"SUBSCRIPTION" shall mean, with respect to any Partner, the total
------------
amount which such Partner has agreed to contribute to the Partnership as
reflected on Schedule A hereto.
----------
"TAX MATTERS PARTNER" shall have the meaning set forth in Section 3.7.
-------------------
"TRANSFER" shall mean any transfer, sale, assignment, gift, pledge,
--------
hypothecation or other disposition of an interest in the Partnership.
40
CONNING INVESTMENT PARTNERS LIMITED PARTNERSHIP III
AMENDMENT NO. 1 TO THE
AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT
AGREEMENT OF AMENDMENT, dated as of the 18th day of March, 1994, by and
among Conning & Company, the undersigned general partner (the "General
Partner"), and the undersigned limited partners, together with any other
persons or entities subsequently admitted as limited partners (the "Limited
Partners"). The General Partner and the Limited Partners are referred to
collectively as the "Partners."
WHEREAS, by executing the limited partnership agreement of Conning
Investment Partners Limited Partnership III, a Delaware limited partnership
(the "Partnership") dated as of December 28, 1993, (the "Initial Partnership
Agreement"), the Partners formed the Partnership pursuant to the provisions
of the Delaware Revised Uniform Limited Partnership Act;
WHEREAS, the Partners caused the Initial Partnership Agreement to be
amended and restated in its entirety by adopting the Amended and Restated
Limited Partnership Agreement of the Partnership dated March 18, 1994 (the
"Restated Agreement"); and
WHEREAS, the Partners desire to amend the Restated Agreement in the
manner set forth below;
NOW THEREFORE, in consideration of the premises and the agreements
contained herein, and intending to be legally bound hereby, the parties
hereto agree as follows:
1. Section 15.2(b) of the Restated Agreement is hereby deleted in
its entirety and replaced with the following new Sections 15.2(b), 15.2(c)
and 15.2(d).
"(b) If any Partner withdraws, or is deemed to have withdrawn,
from the Partnership at any time before any part of such Partner's
Percentage Interest has vested, the Partnership may, but shall not be
obligated to, elect to purchase such Partner's interest in the Partnership
for an amount equal to the balance in such Partner's Capital Account at
the time of such withdrawal. Any such election shall be made by delivery
of written notice to that effect signed by the General Partner and
delivered to the withdrawing Partner within 120 days after the date of
such Partner's withdrawal. If the Partnership elects to purchase the
withdrawing Partner's interest in the Partnership, payment to the
withdrawing Partner for such Partner's interest shall be made, in cash,
within 180 days after the date of such withdrawal."
41
- 2 -
"(c) After the withdrawal or deemed withdrawal of any Partner
before any part of such Partner's Percentage Interest has vested, if the
Partnership does not elect to purchase such former Partner's interest in
the Partnership as provided in Section 15.2(b): (1) the balance in such
former Partner's Capital Account shall be frozen at an amount equal to the
balance in such account as of the date of such former Partner's withdrawal
or deemed withdrawal; (2) such former Partner shall receive no allocations
from the Partnership for any fiscal period after that withdrawal date; and
(3) such former Partner shall receive no distributions from the
Partnership other than such former Partner's proportionate share, based on
the relative Capital Account balances of such former Partner, the General
Partner, the Limited Partners and any Retired Partners (determined at the
time of distribution), of each distribution made pursuant to Section 12.2
to all Partners in proportion to the positive balances in their respective
Capital Accounts."
"(d) Notwithstanding any other provision of this Agreement, no
Partner who has withdrawn or is deemed to have withdrawn from the
Partnership before any part of such Partner's Percentage Interest has
vested shall be entitled, after the date of such withdrawal, to inspect
the Partnership's books or records or to receive any reports or other
information from the Partnership except such former Partner's Schedule K-1
to the Partnership's Internal Revenue Service Form 1065 and any equivalent
state tax schedules or forms required to enable such former Partner to
complete his or her tax returns for any fiscal period during which such
former Partner is treated as a partner of the Partnership for tax
purposes. Any such former Partner hereby agrees that he or she shall
continue to be treated as a partner of the Partnership, solely for tax
purposes, until either (1) such former Partner has received the payment
for his or her interest in the Partnership provided for under Section
15.2(b) (if the Partnership has elected to purchase such former Partner's
interest in the Partnership pursuant to Section 15.2(b)) or (2) such
former Partner has received liquidating distributions from the Partnership
in aggregate amounts equal to the positive balance in such former
Partner's Capital Account (if the Partnership has not so elected)."
2. Section 8.7 of the Restated Agreement is hereby amended by
deleting the word "quarter" in the two instances in which it appears, and
replacing that word with the word "year".
3. Section 14.2 of the Restated Agreement is hereby amended by
deleting the reference therein to "Section 17-402(4) or (6)" and replacing
that reference with "Section 17-402(a)(4) or (6)".
42
- 3 -
4. Section 15.1 of the Restated Agreement is hereby amended (a) by
adding, at the beginning of the first sentence thereof, the phrase "Subject
to Section 15.2"; and (b) by deleting, from the last sentence thereof, the
phrase "set forth above" and replacing that phrase with the phrase "set forth
in Schedule B".
----------
5. This Agreement of Amendment may be signed in counterparts, each
of which shall constitute an original, but all of which taken together shall
constitute one Agreement of Amendment.
6. The amendments set forth in the preceding sections of this
Agreement of Amendment shall be effective as of March 18, 1994.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
43
- 4 -
IN WITNESS WHEREOF, the undersigned have executed this Agreement of
Amendment as of the day and year first above written.
GENERAL PARTNER:
CONNING & COMPANY
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------
Title: Sr. Vice President
LIMITED PARTNERS:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
44
- 5 -
LIMITED PARTNERS
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇. ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
45
CONNING INVESTMENT PARTNERS LIMITED PARTNERSHIP III
AMENDMENT NO. 2 TO THE
AMENDED AND RESTATED LIMITED PARRTNERSHIP AGREEMENT
WHEREAS, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ("Goulekas") and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ("▇▇▇▇▇▇")
desire to be admitted as limited partners to the Conning Investment Partners
Limited Partnership III Amended and Restated as of March 18, 1994 and as
subsequently amended through but not including the date hereof (the
"Partnership");
WHEREAS, Conning & Company, the undersigned general partner (the
"General Partner") desires to have Goulekas and Piaker be admitted as limited
partners to the Partnership;
WHEREAS, the General Partner desires, in accordance with Section 4.1 of
the Amended and Restated Limited Partnership Agreement of the Partnership
dated March 18, 1994 and as subsequently amended through but not including
the date hereof (the "Restated Agreement"), to reduce the General Partner's
Percentage Interest and increase the Percentage Interests of certain of the
Limited Partners;
NOW THEREFORE, in consideration of the premises and the agreements
contained herein, and intending to be legally bound hereby, the parties
hereto agree as follows:
1. Goulekas and Piaker agree to be admitted as limited partners to the
Partnership, subject to the terms and conditions of the Restated
Agreement, and each of them agrees to contribute to the Partnership
his subscription amount as set forth in Schedule A to the Restated
Agreement.
2. Schedule A to the Restated Agreement is hereby amended by deleting
it in its entirety and replacing it with the attached Schedule A.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
46
IN WITNESS WHEREOF, the undersigned have executed this Amendment No. 2
to the Restated Agreement as of the 17th of April, 1995.
GENERAL PARTNER:
CONNING & COMPANY
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------
Title: Vice President,
Secretary and CFO
LIMITED PARTNERS:
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
* * *
Schedule for the general partner and for each limited partner, listing the
name, address, total subscription amount and percentage interest of such
general or limited partner.
47
CONNING INVESTMENT PARTNERS LIMITED PARTNERSHIP III
AMENDMENT NO. 3 TO THE
AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT
WHEREAS, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇▇"), ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇"),
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇▇"), ▇▇▇▇ ▇. ▇▇▇▇▇▇ ("▇▇▇▇▇▇"), ▇▇▇▇▇ ▇. Mossein
("Mossein"), ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ("Pivacek"), ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇▇")
and ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ("Sellier") desire to be admitted as limited partners to
the Conning Investment Partners Limited Partnership III Amended and Restated
as of March 18, 1994 and as subsequently amended through but not including
the date hereof (the "Partnership");
WHEREAS, Conning & Company, the undersigned general partner (the
"General Partner") desires to have Campbell, Daniels, Fongemie, Miller,
Mossein, Pivacek, ▇▇▇▇▇▇▇▇ and Sellier be admitted as limited partners to the
Partnership;
WHEREAS, the General Partner desires, in accordance with Section 4.1 of
the Amended and Restated Limited Partnership Agreement of the Partnership
dated March 18, 1994 and as subsequently amended through but not including
the date hereof (the "Restated Agreement"), to reduce the General Partner's
Percentage Interest and increase the Percentage Interests of certain of the
Limited Partners;
NOW THEREFORE, in consideration of the premises and the agreements
contained herein, and intending to be legally bound hereby, the parties
hereto agree as follows:
1. Campbell, Daniels, Fongemie, Miller, Mossein, Pivacek,
▇▇▇▇▇▇▇▇ and Sellier agree to be admitted as limited partners
to the Partnership, subject to the terms and conditions of the
Restated Agreement, and each of them agrees to contribute to
the Partnership his subscription amount as set forth in
Schedule A to the Restated Agreement.
2. Schedule A to the Restated Agreement is hereby amended by
deleting it in its entirety and replacing it with the
attached Schedule A.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
48
IN WITNESS WHEREOF, the undersigned have executed this Amendment No. 3
to the Restated Agreement as of the 15th of December, 1995.
GENERAL PARTNER:
CONNING & COMPANY
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------
Title: Vice President, Secretary
& Chief Financial Officer
LIMITED PARTNERS:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇. Mossein
---------------------------------
▇▇▇▇▇ ▇. Mossein
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
* * *
Schedule for the general partner and for each limited partner, listing the
name, address, total subscription amount and percentage interest of such
general or limited partner.
49
CONNING INVESTMENT PARTNERS LIMITED PARTNERSHIP III
AMENDMENT NO. 4 TO THE
AMENDED AND RESTATED LIMITED PARRTNERSHIP AGREEMENT
WHEREAS, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇▇▇"), ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
("▇▇▇▇▇▇▇"), ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇▇"), ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
("▇▇▇▇▇▇▇▇"), ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇▇▇▇") and J. ▇▇▇▇▇ ▇▇▇▇▇▇
("Tankaka") desire to be admitted as limited parners to the Conning
Investment Partners Limited Partnership III Amended and Restated as of March
18, 1994 and as subsequently amended through but not including the date
hereof (the "Partnership");
WHEREAS, Conning & Company, the undersigned general partner (the
"General Partner") desires to have Brinkmann, Koester, Mainolfi, McLellan,
▇▇▇▇▇▇▇▇▇▇ and Tanaka be admitted as limited partners to the Partnership;
WHEREAS, the General Partner desires, in accordance with Section 4.1
of the Amended and Restated Limited Patnership Agreement of the Partnership
dated March 18, 1994 and as subsequently amended through but not including
the date hereof (the "Restated Agreement"), to reduce the General Partner's
Percentage Interest and increase the Percentage Interests of certain of the
Limited Partners;
NOW THEREFORE, in consideration of the premises and the agreements
contained herein, and intending to be legally bound hereby, the parties
hereto agree as follows:
1. Brinkmann, Koester, Mainolfi, McLellan, ▇▇▇▇▇▇▇▇▇▇ and Tanaka
agree to be admitted as limited partners to the Partnership,
subject to the terms and conditions of the Restated Agreement,
and each of them agrees to contribute to the Partnership his or
her subscription amount as set forth in Schedule A to the
Restated Agreement.
2. Schedule A to the Restated Agreement is hereby amended by deleting
it in its entirety and replacing it with the attached Schedule A.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
50
IN WITNESS WHEREOF, the undersigned have executed this Amendment No. 4
to the Restated Agreement as of the 18th of December, 1996.
GENERAL PARTNER:
CONNING & COMPANY
By: /s/ ▇. ▇. ▇▇▇▇▇▇▇
----------------------------------
Title: President
LIMITED PARTNERS:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
/s/ ▇. ▇▇▇▇▇▇▇
-------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
-------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
/s/ J. ▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------------
J. ▇▇▇▇▇ ▇▇▇▇▇▇