EXHIBIT 24.2.a.(i)
AGREEMENT OF LIMITED PARTNERSHIP
SEI OPPORTUNITY MASTER FUND, L.P.
The interests in SEI Opportunity Master Fund, L.P. issued pursuant to this
Agreement of Limited Partnership are subject to the restrictions on transfer set
forth in this Agreement.
TABLE OF CONTENTS
ARTICLE 1 - DEFINITIONS.................................................................................................. 1
ARTICLE 2 - GENERAL PROVISIONS........................................................................................... 1
SECTION 2.1. Formation of the Limited Partnership................................................................... 1
SECTION 2.2. Fund Name.............................................................................................. 2
SECTION 2.3. Purposes of the Fund................................................................................... 2
SECTION 2.4. Fiscal Year............................................................................................ 2
SECTION 2.5. Ownership of Interests................................................................................. 2
SECTION 2.6. Status of Interests and Limitation of Personal Liability............................................... 2
ARTICLE 3 - MANAGEMENT OF THE FUND....................................................................................... 3
SECTION 3.1. Board of Directors..................................................................................... 3
SECTION 3.2. Reliance by Third Parties.............................................................................. 7
SECTION 3.3. Advisory, Management and Distribution Contracts........................................................ 7
SECTION 3.4. Indemnification and Limitation of Liability............................................................ 8
SECTION 3.5. Compensation........................................................................................... 11
ARTICLE 4 - INVESTORS' RIGHTS, VOTING POWERS AND MEETINGS................................................................ 11
SECTION 4.1. No Management or Control.............................................................................. 11
SECTION 4.2. Voting Powers......................................................................................... 11
SECTION 4.3. Meetings.............................................................................................. 12
SECTION 4.4. Quorum and Required Vote.............................................................................. 12
SECTION 4.5. Action by Written Consent............................................................................. 13
SECTION 4.6. Record Dates.......................................................................................... 13
SECTION 4.7. Investors' Rights to Records.......................................................................... 13
SECTION 4.8. Additional Provisions................................................................................. 13
ARTICLE 5 - ADMISSION OF INVESTORS; CAPITAL CONTRIBUTIONS; CAPITAL ACCOUNTS; ALLOCATIONS................................. 13
SECTION 5.1. Admission of Investors; Capital Contributions.......................................................... 13
SECTION 5.2. Rights of Investors to Capital......................................................................... 14
SECTION 5.3. Capital Accounts....................................................................................... 14
SECTION 5.4. Allocation of Net Profit and Net Loss.................................................................. 15
SECTION 5.5. Allocation of Special Items............................................................................ 15
SECTION 5.6. Tax Allocations........................................................................................ 15
SECTION 5.7. Reserves............................................................................................... 16
SECTION 5.8. Allocation of Organizational Expenses.................................................................. 16
SECTION 5.9. Distributions.......................................................................................... 16
ARTICLE 6 - TRANSFERS AND REPURCHASES.................................................................................... 17
SECTION 6.1. Transfer of Interests of Investors..................................................................... 17
SECTION 6.2. Withdrawal and Expulsion of Investors.................................................................. 18
SECTION 6.3. Repurchase of Interests................................................................................ 18
SECTION 6.4. Conversion to Open End Management Investment Company................................................... 20
ARTICLE 7 - TERM AND DISSOLUTION OF THE FUND............................................................................. 20
SECTION 7.1. Term................................................................................................... 20
SECTION 7.2. Events Not Causing Dissolution......................................................................... 20
ARTICLE 8 - LIQUIDATION OF THE FUND...................................................................................... 20
ARTICLE 9 - ACCOUNTING AND REPORTING PROVISIONS.......................................................................... 21
SECTION 9.1. Books and Accounts..................................................................................... 21
SECTION 9.2. Tax Elections.......................................................................................... 21
SECTION 9.3. Tax Matters Partner.................................................................................... 21
SECTION 9.4. Valuation of Assets.................................................................................... 21
ARTICLE 10 - GENERAL PARTNER............................................................................................. 22
SECTION 10.1. General Partner........................................................................................ 22
SECTION 10.2. Additional General Partners............................................................................ 22
SECTION 10.3. Withdrawal of General Partner.......................................................................... 22
SECTION 10.4. No Right of Removal of General Partner................................................................. 22
ARTICLE 11 - MISCELLANEOUS PROVISIONS.................................................................................... 22
SECTION 11.1. Principal Place of Business; Registered Agent and Office............................................... 22
SECTION 11.2. Force Majeure.......................................................................................... 23
SECTION 11.3. Applicable Law......................................................................................... 23
SECTION 11.4. Provisions in Conflict with Law or Regulation.......................................................... 23
SECTION 11.5. Waivers................................................................................................ 23
SECTION 11.6. Construction........................................................................................... 23
SECTION 11.7. Amendments............................................................................................. 24
SECTION 11.8. Execution.............................................................................................. 24
SECTION 11.9. Binding Effect......................................................................................... 25
SECTION 11.10. Severability........................................................................................... 25
SECTION 11.11. Confidential Information............................................................................... 25
SECTION 11.12. Power of Attorney...................................................................................... 25
SECTION 11.13. Merger and Consolidation; Conversion................................................................... 26
SECTION 11.14. Applicability of 1940 Act and Registration Statement................................................... 27
SECTION 11.15. Discretion............................................................................................. 27
APPENDIX A
Definitions.......................................................................................................... A-1
SEI OPPORTUNITY MASTER FUND, L.P.
AGREEMENT OF LIMITED PARTNERSHIP
THIS AGREEMENT OF LIMITED PARTNERSHIP (as in effect from time to time,
the "Agreement") of SEI Opportunity Master Fund, L.P. (the "Fund") is made as of
June 30, 2003, by and among the General Partner, the initial Investor and those
Persons who may hereafter be admitted to the Fund as Investors in accordance
with the provisions hereof.
WHEREAS, SEI Opportunity Master Fund, LLC, a Delaware limited liability
company, wishes to convert from a limited liability company to a Delaware
limited partnership pursuant to Section 18-216 of the Delaware LLC Act;
WHEREAS, the Fund will be formed under the Delaware Act, pursuant to
(a) the Fund's Certificate of Conversion from a Limited Liability Company to a
Limited Partnership and (b) the Fund's Certificate of Limited Partnership, each
filed in the office of the Secretary of State of the State of Delaware on June
30, 2003;
WHEREAS, the parties hereto wish to enter into this Agreement to set
out their respective rights, obligations and duties;
WHEREAS, the General Partner has determined to irrevocably delegate its
authority to manage the business and affairs of the Fund to the Board of
Directors, pursuant to Section 17-403 of the Delaware Act; and
WHEREAS, the parties hereto intend that the Fund shall have the ability
to exercise all powers and privileges granted to a limited partnership formed
under the laws of the State of Delaware, and particularly, the Delaware Act;
NOW, THEREFORE, in consideration of the mutual promises and agreements
made herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
ARTICLE 1 - DEFINITIONS
For purposes of this Agreement, capitalized terms shall have the
meanings set forth in Appendix A hereto.
ARTICLE 2 - GENERAL PROVISIONS
SECTION 2.1. FORMATION OF THE LIMITED PARTNERSHIP
The Fund will be organized as a Delaware limited partnership by the
filing of its Certificate of Limited Partnership and its Certificate of
Conversion from a Limited Liability Company to a Limited Partnership in the
office of the Secretary of State of the State of Delaware pursuant to the
Delaware Act. This Agreement shall be effective as of the date of such filings.
SECTION 2.2. FUND NAME
The name of the Fund shall be "SEI Opportunity Master Fund, L.P." or
such other name as the Board of Directors shall designate. All business of the
Fund shall be conducted under the Fund name.
SECTION 2.3. PURPOSES OF THE FUND
The principal purposes of the Fund are as follows: to acquire, hold,
sell and generally deal or invest in Securities (including, in particular,
equity interests issued by limited partnerships, limited liability companies,
business trust and similar business vehicles whose primary business is investing
in securities and other financial instruments but that are not registered or
required to register as investment companies under the ▇▇▇▇ ▇▇▇) and other
assets and property; to exercise all rights, powers, privileges and other
incidents of ownership or possession with respect to Securities, assets or other
property held or owned by the Fund from time to time; and to engage in any
business related thereto or useful in connection therewith.
The foregoing clauses shall each be construed as purposes, objects and
powers, and it is hereby expressly provided that the foregoing enumeration of
specific purposes, objects and powers shall not be held to limit or restrict in
any manner the powers of the Fund, and that they are in furtherance of, and in
addition to, and not in limitation of, the general powers conferred upon the
Fund by the Delaware Act and the other laws of the State of Delaware or
otherwise; nor shall the enumeration of one thing be deemed to exclude another,
although it be of like nature, not expressed.
SECTION 2.4. FISCAL YEAR
The fiscal year of the Fund (the "Fiscal Year") shall be the period
commencing on the Closing Date and ending on the first March 31st following the
closing, and thereafter each period commencing on April 1st of each year and
ending on the earlier of (i) March 31st of the immediately following year and
(ii) the termination of the Fund; provided, however, that the Board of Directors
may change the Fiscal Year in its discretion.
SECTION 2.5. OWNERSHIP OF INTERESTS
The ownership of Interests shall be recorded on the books of the Fund
or a transfer or similar agent for the Fund. No certificates certifying the
ownership of Interests shall be issued except as the Board of Directors may
otherwise determine from time to time.
SECTION 2.6. STATUS OF INTERESTS AND LIMITATION OF PERSONAL LIABILITY
Interests shall be deemed to be personal property giving only the
rights provided in this instrument. The ownership of Interests shall not entitle
the Investors to any title in or to the whole or any part of Fund property or
right to call for a partition or division of the same or for an accounting.
Every Investor by virtue of having become an Investor shall be held to have
expressly assented and agreed to the terms of this Agreement and to have become
a party to this Agreement. Neither the General Partner, the Fund nor the Board
of Directors, nor any officer, employee or agent of the Fund, shall have any
power to bind personally any Investor, nor, except
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as specifically provided herein, to call upon any Investor for the payment of
any sum of money or assessment whatsoever other than such as the Investor may at
any time personally agree to pay.
ARTICLE 3 - MANAGEMENT OF THE FUND
SECTION 3.1. BOARD OF DIRECTORS
(a) The management and control of the business and affairs of the
Fund is hereby delegated by the General Partner to a board of directors (the
"Board of Directors") pursuant to Section 17-403 of the Delaware Act; provided
however that the General Partner shall take such action with respect to the Fund
as is specifically provided in this Agreement. As a result of the delegation of
the General Partner's duties herein, the General Partner shall be responsible
for performing only the following duties with respect to the Fund: (1) to
execute and file with the office of the Secretary of State of the State of
Delaware the Certificate of Limited Partnership and any amendments thereto or
restatements thereof required to be filed pursuant to the Delaware Act; (2) to
execute and file any other certificates required to be filed on behalf of the
Fund with the office of the Secretary of State of the State of Delaware; (3) to
execute any amendments to or restatements of this Agreement in accordance with
the terms of this Agreement (including the Bylaws); and (4) to perform any other
action that the Delaware Act requires be performed by a general partner of a
limited partnership (and which may not be performed by a delegate of a general
partner).
(b) Except as otherwise provided in Section 3.1(a), the management
and operation of the Fund and its business and affairs shall be, and hereby is,
vested solely in the Board of Directors, and the Persons constituting the Board
of Directors shall be directors of the Fund (each, a "Director," and
collectively, the "Directors"), and in no event shall any Investor as such have
any role in the management of the Fund's affairs. Subject to any voting powers
of Interests as set forth in this Agreement or by resolution of the Board of
Directors, the Board of Directors shall be governed as set forth in this Section
3.1. The number of Directors shall be fixed by the Board of Directors, provided
that subsequent to the Closing Date, there shall be not less than three
Directors. Any vacancies, including vacancies existing by virtue of an increase
in the number of Directors, occurring in the Board of Directors may be filled by
the Board of Directors, except that in the case of any vacancy occurring after
the Closing Date, only if, immediately after filling any such vacancy, at least
two-thirds of the Directors then holding office shall have been elected to such
office by the Investors. In the event that at any time less than a majority of
the Directors then holding office were elected to such office by the Investors,
the Board of Directors shall call a meeting of Investors in accordance with the
provisions of Section 4.3 for the purpose of electing Directors. Each Director
elected by the Investors or by the Board of Directors shall serve until the next
meeting of Investors called for the purpose of electing Directors and until the
election and qualification of his or her successor or until he or she sooner
dies, resigns or is removed. The initial Directors, each of whom shall serve
until the first meeting of Investors at which Directors are elected and until
his or her successor is elected or qualified, or until he or she sooner dies,
resigns or is removed, shall be ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ and such other persons as the Director or Directors then in office
shall, prior to the Closing Date, appoint. By signing this Agreement or a
Subscription Agreement, an Investor admitted on the Closing Date shall be deemed
to have voted for the election of each of the
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Directors holding office on the Closing Date pursuant to the previous sentence.
By vote of a majority of the Directors then in office, the Board of Directors
may remove a Director with or without cause. At any meeting of Investors called
for the purpose, a Director may be removed, with or without cause, by vote of
the Investors representing in the aggregate at least two-thirds of the combined
Capital Account balances of all the Investors. Any Director may resign at any
time by written instrument signed by him or her and delivered to any officer of
the Fund or to a meeting of the Board of Directors. Such resignation shall be
effective upon receipt unless specified to be effective at some other time.
Except to the extent expressly provided in a written agreement with the Fund, no
Director resigning and no Director removed shall have any right to any
compensation for any period following his or her resignation or removal, or any
right to damages on account of such removal.
The death, resignation, removal, declaration as bankrupt or incapacity
of one or more Directors, or of all of them, shall not operate to dissolve the
Fund or to revoke any existing agency created pursuant to the terms of this
Agreement. Whenever a vacancy in the Board of Directors shall occur, until such
vacancy is filled as provided herein or in the Bylaws, or while any Director is
physically or mentally incapacitated, the Director(s) in office, regardless of
the number, shall have all the powers granted to the Board of Directors and
shall discharge all the duties imposed upon the Board of Directors by this
Agreement, and a certificate signed by a majority of the other Director(s) of
such vacancy, absence or incapacity, shall be conclusive.
(c) Subject to the provisions of this Agreement, the business of
the Fund shall be managed by the Board of Directors, and it shall have all
powers necessary or convenient to carry out that responsibility including the
power to engage in transactions of all kinds on behalf of the Fund, including
all the powers granted to a board of directors of an investment company
registered under the 1940 Act. Without limiting the foregoing, the Board of
Directors may adopt Bylaws not inconsistent with this Agreement providing for
the regulation and management of the affairs of the Fund and may amend and
repeal them to the extent that such Bylaws do not reserve that right to the
Investors; they may, subject to Section 3.1(b), remove a Director from their
number with or without cause; they may, subject to Section 3.1(b), fill
vacancies in their number (including any vacancies created by an increase in the
number of Directors and any vacancies created by the removal of a Director);
they may elect and remove such officers and appoint and terminate such agents as
they consider appropriate; they may appoint from their own number and terminate
one or more committees consisting of two or more Directors which may exercise
the powers and authority of the Board of Directors to the extent that the
Directors determine; they may employ one or more custodians of the assets of the
Fund and may authorize such custodians to employ subcustodians and to deposit
all or any part of such assets in a system or systems for the central handling
of Securities or with a Federal Reserve Bank; they may retain a transfer agent
or a shareholder servicing agent, or both; they may provide for the distribution
of Interests by the Fund, through one or more principal underwriters or
otherwise; they may set record dates for the determination of the eligibility of
Investors to vote with respect to various matters; and in general they may
delegate such authority as they consider desirable to any officer of the Fund,
to any committee of the Board of Directors and to any agent or employee of the
Fund or to any such custodian or underwriter.
Without limiting the foregoing, the Board of Directors shall have power
and authority:
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(i). To invest and reinvest cash, and to hold cash
uninvested;
(ii). To sell, exchange, lend, pledge, mortgage,
hypothecate, lease or write options with respect to or otherwise deal
in any property rights relating to any or all of the assets of the
Fund;
(iii). To vote or give assent, or exercise any rights of
ownership, with respect to stock or other Securities, assets or
property; and to execute and deliver proxies or powers of attorney to
such person or persons as the Board of Directors shall deem proper,
granting to such person or persons such power and discretion with
relation to Securities, assets or property as the Board of Directors
shall deem proper;
(iv). To exercise powers and rights of subscription or
otherwise which in any manner arise out of ownership of Securities,
assets or other property;
(v). To hold any Security, asset or other property in a
form not indicating any ownership by the Fund, whether in bearer,
unregistered or other negotiable form, or in its own name or in the
name of a custodian or subcustodian or a nominee or nominees or
otherwise;
(vi). To allocate assets, liabilities and expenses of the
Fund among the Capital Accounts of the Investors;
(vii). To consent to or participate in any plan for the
reorganization, consolidation or merger of any corporation or issuer of
any Security which is held by the Fund; to consent to any contract,
lease, mortgage, purchase or sale of property by such corporation or
issuer; and to pay calls or subscriptions with respect to any Security
held by the Fund;
(viii). To join with others in acting through a committee,
depositary, voting trustee or otherwise, and in that connection to
deposit any Security, asset or other property with, or transfer any
Security, asset or other property to, any such committee, depositary or
trustee, and to delegate to any of them such power and authority with
relation to any Security, asset or other property (whether or not so
deposited or transferred) as the Board of Directors shall deem proper,
and to agree to pay, and to pay, such portion of the expenses and
compensation of such committee, depositary or trustee as the Board of
Directors shall deem proper;
(ix). To pay, extend, renew, modify, adjust, submit to
arbitration, prosecute, defend or compromise, upon such terms as it may
determine and upon such evidence as it may deem sufficient, any debt,
obligation, suit, liability, cause of action or claim, including taxes,
either in favor of or against the Fund;
(x). To enter into, form, own, invest in and acquire
shares of or interests in joint ventures, general or limited
partnerships and any other combinations or associations;
(xi). To borrow funds or other property;
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(xii). To endorse or guarantee the payment of any notes or
other obligations of any person; to make contracts of guaranty or
suretyship, or otherwise assume liability for payment thereof;
(xiii). To purchase and pay for entirely out of Fund property
such insurance as the Board of Directors may deem necessary or
appropriate for the conduct of the Fund's business, including without
limitation insurance policies insuring the assets of the Fund and the
payment of distributions and principal on its portfolio investments,
and insurance policies insuring the Investors, Directors, officers,
employees, agents, Advisers or Subadvisers, principal underwriters or
independent contractors of the Fund individually against all claims and
liabilities of every nature arising by reason of holding, being or
having held any such office or position, or by reason of any action
alleged to have been taken or omitted by any such person as Director,
officer, employee, agent, Adviser or Subadviser, principal underwriter
or independent contractor, including any action taken or omitted that
may be determined to constitute negligence, whether or not the Fund
would have the power to indemnify such person against liability;
(xiv). To enter into or engage in forward commitments,
futures contracts and swap contracts and to buy and sell options on
futures contracts or swap contracts and to buy, sell or enter into
transactions with respect to any Securities, assets or other property;
(xv). To make such filings under the Delaware Act (other
than any that must be executed by the General Partner) as may be
necessary or desirable to give effect to the provisions of this
Agreement or any amendments thereto;
(xvi). To exercise such further rights and powers incidental
or related to any or all of the foregoing or as may be necessary or
desirable in connection with the conduct of the Fund's business and to
carry out its purposes, except as and to the extent expressly limited
or prohibited by this Agreement; and
(xvii). To engage in any other lawful act or activity in
which limited partnerships organized under the Delaware Act may engage.
The Board of Directors shall not in any way be bound or limited by any
present or future law or custom in regard to investments by fiduciaries. The
Board of Directors shall not be required to obtain any court order to deal with
any assets of the Fund or take any other action hereunder.
Except as otherwise provided herein, by law or from time to time in the
Bylaws, any action to be taken by the Board of Directors may be taken by a
majority of the Directors present at a meeting of the Board of Directors (a
quorum being present), within or without Delaware, including any meeting held by
means of a conference telephone or other communications equipment by means of
which all persons participating in the meeting can hear each other at the same
time and participation by such means shall constitute presence in person at a
meeting, or by written consents of a majority of the Directors then in office.
The parties hereto intend that, except to the extent otherwise
expressly provided herein, (i) each Director shall be vested with the same
powers, authority and responsibilities on behalf of
6
the Fund as are customarily vested in a director of a Delaware corporation and
(ii) each Director who is not an "interested person" of the Fund, as such term
is defined by the 1940 Act, shall be vested with the same powers, authority and
responsibilities on behalf of the Fund as are customarily vested in each
director of a closed-end management investment company registered under the 1940
Act that is organized as a Delaware corporation who is not an "interested
person" of such company, as such term is defined under the 1940 Act.
(d) The Board of Directors may cause title to all or any portion
of the assets of the Fund, including, without limiting the generality of the
foregoing, title to all or any portion of any Securities, to be held in the name
of a nominee or trustee, in street name or in such other manner as the Board of
Directors may, from time to time, deem advisable. The Board of Directors may
hold any assets of the Fund in bearer form and deposit any Securities, assets or
other property with a custodian or in a depository, clearing corporation or
similar corporation, either domestic or foreign, including with or in the
Adviser or any Affiliate thereof, and may deposit or invest any cash or other
assets in one or more money market mutual funds or other accounts of any Person.
(e) Without limiting the generality of the other powers and
authority granted to the Board of Directors hereunder, the Board of Directors is
authorized to (i) pay out of the assets of the Fund all Fund Expenses and (ii)
reimburse out of the assets of the Fund any Person providing services to the
Fund for the payment of any Fund Expenses.
(f) The Board of Directors shall have the authority in its sole
discretion to establish and maintain such cash or cash equivalent reserves as it
deems appropriate in connection with the business of the Fund, including without
limitation reserves for fees and expenses, working capital purposes and
potential claims, if any.
SECTION 3.2. RELIANCE BY THIRD PARTIES
Notwithstanding any other provision of this Agreement, any contract,
instrument or act of the Board of Directors on behalf of the Fund shall be
conclusive evidence in favor of any third party dealing with the Fund that the
Board of Directors has the authority, power and right to execute and deliver
such contract or instrument or to take such act on behalf of the Fund.
SECTION 3.3. ADVISORY, MANAGEMENT AND DISTRIBUTION CONTRACTS
Subject to such requirements and restrictions as may be set forth in
the Bylaws, this Agreement or the 1940 Act, the Board of Directors may, at any
time and from time to time, contract for exclusive or nonexclusive advisory
and/or management services for the Fund with SEI Investments Management
Corporation, a Delaware corporation ("SEI"), or any other Person to serve as
Adviser; and any such contract may contain such other terms as the Board of
Directors may determine, including, without limitation, authority for the
Adviser (i) to determine from time to time without prior consultation with the
Board of Directors what investments shall be purchased, held, sold or exchanged
and what portion, if any, of the assets of the Fund shall be held uninvested and
to make changes in the Fund's investments and (ii) to delegate all or any part
of its authority thereunder to one or more Subadvisers. The Board of Directors
may also, at any time and from time to time, contract with the Adviser or any
other Person, appointing it
7
exclusive or nonexclusive distributor, principal underwriter or placement agent
for the Interests, every such contract to comply with such requirements and
restrictions, if any, as may be set forth in the Bylaws; and any such contract
may contain such other terms as the Board of Directors may determine. The Board
of Directors is further empowered, at any time and from time to time, to
contract with any Persons to provide such other services to the Fund, as the
Board of Directors determines to be in the best interests of the Fund.
The fact that:
any of the Investors, Directors or officers of the Fund is a
shareholder, director, officer, partner, trustee, employee,
member, manager, adviser, subadviser, principal underwriter,
placement agent, distributor or Affiliate or agent of or for
any partnership, corporation, trust, association, limited
liability company or other organization, or of or for any
parent or Affiliate of any organization, with which an
advisory, subadvisory or management contract, or principal
underwriter's or distributor's contract, or placement
agreement or transfer, shareholder servicing or other agency
contract may have been or may hereafter be made with the Fund,
or that any such organization, or any parent or Affiliate
thereof, is an Investor of or has an interest in the Fund, or
that
any partnership, corporation, trust, association, limited
liability company or other organization (or any Affiliate
hereof) with which an advisory, subadvisory or management
contract, or principal underwriter's or distributor's
contract, or placement agreement or transfer, shareholder
servicing or other agency contract may have been or may
hereafter be made by the Fund also has an advisory,
subadvisory or management contract, or principal underwriter's
or distributor's contract, placement agreement or transfer,
shareholder servicing or other agency contract with one or
more other corporations, trusts, associations, limited
liability companies or other organizations, or has other
business or interests,
shall not affect the validity of any such contract or disqualify any Investor,
Director or officer of the Fund from voting upon or executing the same or create
any liability or accountability to the Fund or its Investors.
SECTION 3.4. INDEMNIFICATION AND LIMITATION OF LIABILITY
(a) Subject to the provisions of Sections 3.4(b) and 3.4(i)
hereof, to the fullest extent that indemnification and limitations on the
liability of the General Partner, the Directors and officers are permitted by
the Delaware Act, the Fund shall indemnify the General Partner, each of the
Fund's Directors and officers (including its Directors or officers who serve at
the Fund's request as directors, officers, members, partners or trustees of
another organization in which the Fund has any interest as a shareholder,
creditor or otherwise) (hereinafter referred to as a "Covered Person") against
all liabilities and expenses, including but not limited to amounts paid in
satisfaction of judgments, in compromise or as fines and penalties, and counsel
fees reasonably incurred by any Covered Person in connection with the defense or
disposition of any action, suit or other proceeding, whether civil or criminal,
before any court or administrative or legislative body, in which such Covered
Person may be or may have been involved as a party or
8
otherwise or with which such Covered Person may be or may have been threatened,
while in office or thereafter, by reason of being or having been such a Covered
Person except with respect to any matter as to which such Covered Person shall
have been finally adjudicated in any such action, suit or other proceeding to be
liable to the Fund or its Investors by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of
such Covered Person's office. Expenses, including reasonable counsel fees so
incurred by any such Covered Person (but excluding amounts paid in satisfaction
of judgments, in compromise or as fines or penalties), shall be paid from time
to time by the Fund in advance of the final disposition of any such action, suit
or proceeding upon receipt of an undertaking by or on behalf of such Covered
Person to repay amounts so paid to the Fund if it is ultimately determined that
indemnification of such expenses is not authorized under this Section 3.4,
provided, however, that either (i) such Covered Person shall have provided
appropriate security for such undertaking, (ii) the Fund shall be insured
against losses arising from any such advance payments or (iii) either a majority
of the disinterested Directors acting on the matter (provided that a majority of
the disinterested Directors then in office act on the matter), or independent
legal counsel in a written opinion, shall have determined, based upon a review
of readily available facts (as opposed to a full trial type inquiry) that there
is reason to believe that such Covered Person will be found entitled to
indemnification under this Article 3.
(b) As to any matter disposed of (whether by a compromise payment,
pursuant to a consent decree or otherwise) without an adjudication by a court,
or by any other body before which the proceeding was brought, that such Covered
Person is liable to the Fund or its Investors by reason of willful misfeasance,
bad faith, gross negligence or reckless disregard of the duties involved in the
conduct of his or her office, indemnification shall be provided if (i) approved,
after notice that it involves such indemnification, by at least a majority of
the disinterested Directors acting on the matter (provided that a majority of
the disinterested Directors then in office act on the matter) upon a
determination, based upon a review of readily available facts (as opposed to a
full trial type inquiry) that such Covered Person is not liable to the Fund or
its Investors by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his or her office or
(ii) there has been obtained an opinion in writing of independent legal counsel,
based upon a review of readily available facts (as opposed to a full trial type
inquiry) that such Covered Person is not liable to the Fund or its Investors by
reason of willful misfeasance, bad faith, gross negligence or reckless disregard
of the duties involved in the conduct of his or her office. Any approval
pursuant to this Section 3.4 shall not prevent the recovery from any Covered
Person of any amount paid to such Covered Person in accordance with this Section
3.4 as indemnification if such Covered Person is subsequently adjudicated by a
court of competent jurisdiction to have been liable to the Fund or its Investors
by reason of willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of such Covered Person's office.
(c) The right of indemnification hereby provided shall not be
exclusive of or affect any other rights to which such Covered Person may be
entitled. As used in this Section 3.4, the term "Covered Person" shall include
such person's heirs, executors and administrators and a "disinterested Director"
is a Director who is not an "interested person" of the Fund as defined in
Section 2(a)(19) of the 1940 Act (or who has been exempted from being an
"interested person" by any rule, regulation or order of the Commission), and
against whom none of such actions, suits or other proceedings or another action,
suit or other proceeding on the same or similar
9
grounds is then or has been pending. Nothing contained in this Article 3 shall
affect any rights to indemnification to which personnel of the Fund, other than
Directors or officers, and other persons may be entitled by contract or
otherwise under law, nor the power of the Fund to purchase and maintain
liability insurance on behalf of any such person; provided, however, that the
Fund shall not purchase or maintain any such liability insurance in
contravention of applicable law, including without limitation the 1940 Act. For
purposes of the determination or opinion referred to in clauses (a) and (b) of
this Section 3.4, the majority of disinterested Directors acting on the matter
or independent legal counsel, as the case may be, shall be entitled to rely upon
a rebuttable presumption that the Covered Person has not engaged in willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of such Covered Person's office.
(d) In case any Investor or former Investor shall be held to be
personally liable solely by reason of his or her being or having been an
Investor and not because of his or her acts or omissions or for some other
reason, the Investor or former Investor (or his or her heirs, executors,
administrators or other legal representatives or in the case of a corporation or
other entity, its corporate or other general successor) shall be entitled to be
held harmless from and indemnified out of the assets of the Fund against all
loss and expense arising from such liability.
(e) All persons extending credit to, contracting with or having
any claim against the Fund shall look only to the assets of the Fund for payment
under such credit, contract or claim; and neither the Investors, the General
Partner, the Directors, nor any of the Fund's officers, employees or agents,
whether past, present or future, shall be personally liable therefor. Nothing in
this Agreement shall protect any General Partner or Director against any
liability to which such General Partner or Director would otherwise be subject
by reason of willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of the office of the General
Partner or the office of Director.
(f) The exercise by the Board of Directors of its powers and
discretions hereunder shall be binding upon everyone interested.
(g) No person dealing with the General Partner or the Board of
Directors shall be bound to make any inquiry concerning the validity of any
transaction made or to be made by the General Partner or the Board of Directors
or to see to the application of any payments made or property transferred to the
Fund or upon its order.
(h) The General Partner, an officer or Director shall be liable
for its, his or her own willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of the office of such
General Partner, officer or Director, and for nothing else, and shall not be
liable for errors of judgment or mistakes of fact or law. The General Partner,
officers and Directors may (but shall not be required to) take advice of counsel
or other experts with respect to all matters, including the meaning and
operation of this Agreement, and shall be under no liability for any act or
omission in accordance with such advice or for failing to follow such advice,
but nothing herein contained shall protect the General Partner, any officer, or
Director against any liability to which it, he or she would otherwise be subject
by reason of willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the
10
conduct of its, his or her office. The General Partner, officers and Directors
shall not be required to give any bond as such, nor any surety if a bond is
required.
(i) The General Partner and the Directors shall not be responsible
or liable in any event for any neglect or wrongdoing of any other Person,
including any officer, agent, employee, Adviser, Subadviser or principal
underwriter of the Fund; the General Partner shall not be responsible for the
act or omission of any Director; and no Director shall be responsible for the
act or omission of any other Director or of the General Partner. Nothing herein
contained, however, shall protect the General Partner or any Director against
any liability to which it, he or she would otherwise be subject by reason of
willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his or her office.
(j) Every note, bond, contract, instrument, certificate or
undertaking and every other act or thing whatsoever issued, executed or done by
or on behalf of the Fund, the General Partner or the Directors or any of them in
connection with the Fund shall be conclusively deemed to have been issued,
executed or done only in or with respect to its, their, his or her capacity as
the General Partner, Directors or Director, as the case may be, and such General
Partner, Directors or Director shall not be personally liable thereon.
SECTION 3.5. COMPENSATION
The Board of Directors may, from time to time, fix a reasonable amount
of compensation to be paid by the Fund to the General Partner and the Directors.
Nothing herein shall in any way prevent the employment of any Director for
advisory, management, legal, accounting, investment banking or other services
and payment of the same by the Fund.
ARTICLE 4 - INVESTORS' RIGHTS, VOTING POWERS AND MEETINGS
SECTION 4.1. NO MANAGEMENT OR CONTROL
Except as expressly provided in this Agreement, no Investor as such
shall take part in or interfere in any manner with the management of the
business and affairs of the Fund or have any right or authority to act for or
bind the Fund. An Investor may be a Director or officer of the Fund, in which
event such Investor's rights and obligations in each capacity shall be
determined separately in accordance with the terms and provisions of this
Agreement or as provided in the Delaware Act.
SECTION 4.2. VOTING POWERS
Subject to any voting powers of Interests as set forth elsewhere in
this Agreement or by resolution of the Board of Directors, the Investors shall
have the voting powers set forth in this Section 4.2. The Investors shall have
power to vote only (i) for the election of Directors and other related matters
as provided in Section 3.1, (ii) with respect to any amendment of this Agreement
to the extent and as provided in Section 11.7, (ii) with respect to a conversion
of the Fund to an open-end management investment company pursuant to the
provisions of Section 6.4 and (iii) with respect to such additional matters
relating to the Fund as may be required by this Agreement, the Bylaws,
applicable law or any registration of the Fund with the Commission or any state,
or as the Board of Directors may consider necessary or desirable. With respect
to any
11
matter, the Investors shall vote in proportion to their Capital Account balances
as of the record date applicable to the consideration of such matter and shall
vote together. There shall be no cumulative voting in the election of Directors.
The Investors may vote in person or by proxy. Unless the Board of Directors, in
its sole discretion, determines otherwise, only matters set forth in the notice
of a meeting may be voted on by Investors at a meeting. From time to time, the
Board of Directors may seek to obtain voting instructions from Investors, in
which case the Board of Directors shall establish such procedures and protocols
as it deems to be appropriate under the circumstances.
SECTION 4.3. MEETINGS
Meetings of the Investors may be called by the Board of Directors for
the purpose of electing Directors as provided in Section 3.1 and for such other
purposes as may be prescribed by law, by this Agreement or by the Bylaws.
Meetings of the Investors may also be called by the Board of Directors from time
to time for the purpose of taking action upon any other matter deemed by the
Directors to be necessary or desirable. A meeting of Investors may be held at
any place designated by the Board of Directors. Written notice of any meeting of
Investors, stating the time and place of the meeting, shall be given or caused
to be given by the Board of Directors to each Investor at least seven days
before such meeting by mailing such notice, postage prepaid, to the address an
Investor has most recently furnished to the Fund or its agent or by transmitting
such notice by facsimile or other electronic means to the telephone or facsimile
number or e-mail or other electronic address an Investor has most recently
furnished to the Fund or its agent. Failure to receive notice of a meeting on
the part of any Investor shall not affect the validity of any act or proceeding
of the meeting, so long as a quorum shall be present at the meeting, except as
otherwise required by applicable law. Whenever notice of a meeting is required
to be given to an Investor under this Agreement or the Bylaws, a written waiver
thereof, executed before or after the meeting by such Investor or his, her or
its attorney thereunto authorized and filed with the records of the meeting,
shall be deemed equivalent to such notice.
SECTION 4.4. QUORUM AND REQUIRED VOTE
Subject to any voting powers of Interests as set forth elsewhere in
this Agreement or by resolution of the Board of Directors, the provisions set
forth in this Section 4.4 shall apply to meetings and votes of Investors. Except
when a larger quorum is required by law, by the Bylaws or by this Agreement,
Investors with Capital Account balances representing in aggregate thirty per
centum (30%) of the aggregate Capital Account balances of all Investors and who
are entitled to vote shall constitute a quorum at a meeting of Investors. Any
meeting of Investors may be adjourned from time to time by the vote of Investors
whose Capital Account balances in the aggregate represent more than one-half of
the aggregate Capital Account balances of all Investors present at such meeting
in person or by proxy and who are entitled to vote and have voted with respect
to such adjournment, whether or not a quorum is present, and the meeting may be
held as adjourned within a reasonable time after the date set for the original
meeting without further notice. When a quorum is present at any meeting, the
vote of Investors whose Capital Account balances in the aggregate represent more
than one-half of the aggregate Capital Account balances of all Investors present
at such meeting in person or by proxy and who are entitled to vote shall decide
any questions and the vote of a plurality (measured by Capital
12
Account balances of Investors) shall elect a Director, except when a larger vote
is required by any provision of this Agreement or the Bylaws or by law.
SECTION 4.5. ACTION BY WRITTEN CONSENT
Any action taken by Investors may be taken without a meeting if
Investors whose Capital Account balances in the aggregate represent more than
one-half of the total Capital Account balances of all Investors entitled to vote
on the matter (or such larger proportion thereof as shall be required by any
express provision of this Agreement or the Bylaws or by law) consent to the
action in writing and such written consents are delivered to the officer or
agent of the Fund having custody of the records of the meetings of Investors and
are filed therewith. The effective date of any action taken by Investors by
written consent shall be the date by which the appropriate officer or agent of
the Fund shall have received the requisite consents for such action. Unless
otherwise determined by the Board of Directors, no written consent shall be
effective to take the action referred to therein unless, within 90 days of the
date the first such consent is properly delivered to the appropriate officer or
agent of the Fund, written consents signed by a sufficient number of Investors
to take action are delivered to such appropriate officer or agent. An action
properly taken by written consent in accordance with this Section 4.5 shall be
treated for all purposes as a vote taken at a meeting of Investors.
SECTION 4.6. RECORD DATES
The Bylaws may include provisions governing the authority of the Board
of Directors to establish from time to time a record date for determining the
Investors having the right to notice of and to vote at a meeting and any
adjournment thereof or the right to receive any dividend or other distribution,
or for any other purpose.
SECTION 4.7. INVESTORS' RIGHTS TO RECORDS
Any documents which an Investor may have a right to obtain pursuant to
the Delaware Act, the 1940 Act or otherwise shall be furnished at the Fund's
principal office only after the Investor gives 30 days' prior written notice of
its intent to obtain such records, and further subject to such rules and
procedures (including with respect to payment of associated expenses, to the
extent permitted by law) as the Board of Directors may establish, which may
include rules and procedures established after the date of such notice.
SECTION 4.8. ADDITIONAL PROVISIONS
The Bylaws may include further provisions for Investors' votes and
meetings and related matters.
ARTICLE 5 - ADMISSION OF INVESTORS; CAPITAL CONTRIBUTIONS; CAPITAL
ACCOUNTS; ALLOCATIONS
SECTION 5.1. ADMISSION OF INVESTORS; CAPITAL CONTRIBUTIONS
The Board of Directors (or its designated agent) may admit Investors to
the Fund from time to time upon the execution by a prospective Investor of an
appropriate signature page to this
13
Agreement or upon the completion and execution by a prospective Investor, and
the acceptance of the same by the Board of Directors (or its designated agent),
of a Subscription Agreement in a form specified by the Board of Directors (or
its designated agent) from time to time (the execution of which shall be deemed
to constitute the execution of a signature page to this Agreement). Each such
Subscription Agreement shall specify the Capital Contribution to be made by such
prospective Investor and shall contain representations and warranties by the
prospective Investor as to such prospective Investor's eligibility to purchase
an Interest. The Board of Directors (or its designated agent) may adopt
procedures from time to time governing the remittance by prospective Investors
of Capital Contributions and the receipt and handling of the same by the Fund.
The Board of Directors (or its designated agent) may set maximum and minimum
amounts from time to time (as well as incremental limits) applicable to each
Capital Contribution. The admission of any Person as an Investor in the Fund
shall be effective upon the revision of the books and records of the Fund to
reflect the name and Capital Contribution of such Investor.
The Board of Directors (or its designated agent) may also from time to
time accept additional Capital Contributions from existing Investors and may
adopt procedures relating to the remittance by Investors and receipt and
handling of the same by the Fund. The Board of Directors (or its designated
agent) may from time to time set maximum and minimum amounts (as well as
incremental limits) applicable to each such additional Capital Contribution.
The Board of Directors (or its designated agent) shall be authorized in
its discretion not to accept a Capital Contribution from any Investor or
prospective Investor for any reason.
SECTION 5.2. RIGHTS OF INVESTORS TO CAPITAL
No Investor shall be entitled to interest on any contribution to the
capital of the Fund, nor shall any Investor be entitled to the return of any
capital of the Fund except (i) upon the repurchase by the Fund of part or all of
such Investor's Interest pursuant to Section 6.3 hereof, (ii) pursuant to the
provisions of Section 5.7 or 5.9 or (iii) upon the liquidation of the Fund's
assets pursuant to Article 8. No Investor shall have the right to require
partition of the Fund's property or to compel any sale or appraisal of the
Fund's assets.
SECTION 5.3. CAPITAL ACCOUNTS
(a) A separate Capital Account shall be maintained for each
Investor. The opening balance of an Investor's Capital Account shall equal the
initial Capital Contribution of such Investor. Thereafter, the Capital Account
shall be adjusted as follows:
(i). increased by the amount of any additional Capital
Contribution made by such Investor to the Fund pursuant to Section 5.1;
(ii). increased or decreased, as the case may be, by the
amounts allocated to such Capital Account pursuant to Section 5.4, 5.7
or 5.8;
(iii). decreased by the sum of the amount of any repurchase
of the Interest, or portion thereof, of such Investor and the amount of
any cash and the fair market value of
14
any property distributed to such Investor pursuant to Section 5.9 or
6.3 (but not reinvested) or Article 8; and
(iv). decreased for withholding taxes (or other special
items not chargeable ratably to all Investors) pursuant to Section 5.5.
(b) If all or a portion of an Interest is Transferred in
accordance with the terms of this Agreement, the transferee shall succeed to the
Capital Account of the transferor to the extent it relates to the Transferred
Interest.
SECTION 5.4. ALLOCATION OF NET PROFIT AND NET LOSS
As of the last day of each Fiscal Period, any Net Profit or Net Loss
for the Fiscal Period shall be allocated among the Capital Accounts of all
Investors, in proportion to their respective opening Capital Account balances
for such Fiscal Period (after taking into account any Capital Contributions as
of the first day of such Fiscal Period).
SECTION 5.5. ALLOCATION OF SPECIAL ITEMS
(a) Except as otherwise provided for in this Agreement and unless
prohibited by the 1940 Act, withholding taxes or other tax obligations incurred
by the Fund that are attributable to any Investor will be debited against the
Capital Account of that Investor as of the close of the Fiscal Period during
which the Fund paid those obligations, thereby reducing the amount distributable
to the Investor. If the amount of those taxes is greater than the distributable
amounts, then the Investor or any successor to such Investor's Interest will be
required to pay upon demand to the Fund, as a contribution to the capital of the
Fund, the amount of the excess.
(b) Except as otherwise provided for in this Agreement and unless
prohibited by the 1940 Act, any expenditures payable by the Fund, to the extent
determined by the Board of Directors (or its designated agent) to have been paid
or withheld on behalf of, or by reason of particular circumstances applicable
to, one or more but fewer than all of the Investors, shall be charged to only
those Investors on whose behalf such payments are made or whose particular
circumstances gave rise to such payments. Such charges shall be debited from the
Capital Accounts of such Investors as of the close of the Fiscal Period during
which any such items were paid or accrued by the Fund.
SECTION 5.6. TAX ALLOCATIONS
The income, gains, losses, deductions and credits of the Fund shall be
allocated for federal, state and local income tax purposes among the Investors
so as to reflect, in the judgment of the Adviser, the Interests of the Investors
in the Fund set forth in this Agreement. The Adviser, in consultation with the
Fund's tax advisor, is authorized: (a) to select such tax allocation methods as
may in the Adviser's judgment be appropriate to satisfy the requirements of
section 704(c) of the Code regarding allocations of gain, income and loss for
federal income tax purposes, including without limitation an "aggregate
approach" involving "partial netting" or "full netting" with respect to reverse
section 704(c) allocations to the extent permitted by Treasury Regulations
Section 1.704-3; (b) to interpret and apply the allocation provisions hereof as
providing for a "qualified income offset," "minimum gain chargeback" and such
other allocation
15
principles as may be required under section 704 of the Code and applicable
regulations (provided that if such principles are applied in making allocations
hereunder, subsequent allocations shall be made so as to reverse, to the extent
possible in the Adviser's judgment, the effect of the application of such
principles); (c) to make special allocations of gain, income or loss to
Investors all or part of whose Interests have been repurchased by the Fund; (d)
to determine the allocation of specific items of income or loss on a gross
rather than net basis; (e) to determine the allocation of specific items of
income, gain, loss, deduction and credit of the Fund; and (f) to vary any and
all of the foregoing allocation provisions to the extent necessary in the
judgment of the Adviser to comply with section 704 of the Code and applicable
regulations. The Board of Directors and the Adviser shall each have the power
and authority to make all accounting, tax and financial reporting determinations
and decisions with respect to the Fund, and such determinations and decisions
shall be final and binding on all of the Investors. The Investors are aware of
the potential income tax consequences of the allocations made by this Section
5.6 and hereby agree to be bound by the provisions of this Section 5.6 in
reporting their shares of Fund income and loss for income tax purposes.
SECTION 5.7. RESERVES
Appropriate reserves may be created, accrued and charged against Net
Assets and proportionately against the Capital Accounts of the Investors for
contingent liabilities, if any, as of the date any such contingent liability
becomes known to the Adviser or the Board of Directors, such reserves to be in
the amounts which the Board of Directors, in its sole discretion, deem necessary
or appropriate. The Board of Directors or the Adviser may increase or reduce any
such reserves from time to time by such amounts as the Board of Directors or the
Adviser, each in its sole discretion, deems necessary or appropriate. The amount
of any such reserve, or any increase or decrease therein, shall be
proportionately charged or credited, as appropriate, to the Capital Accounts of
those parties who are Investors at the time when such reserve is created,
increased or decreased, as the case may be.
SECTION 5.8. ALLOCATION OF ORGANIZATIONAL EXPENSES
Organizational Expenses shall be allocated among and debited against
the Capital Accounts of the Investors in any manner approved by the Board of
Directors (or its designated agent).
SECTION 5.9. DISTRIBUTIONS
The Fund shall, when authorized by the Board of Directors in its sole
discretion, make distributions in cash or in kind at any time to all of the
Investors on a pro rata basis in accordance with each Investor's Capital Account
balance at such time. Notwithstanding the foregoing or any other provision
contained in this Agreement, the Fund, and the Board of Directors on behalf of
the Fund, shall not be required to make a distribution to an Investor in respect
of its Interest if such distribution would violate the Delaware Act or other
applicable law.
16
ARTICLE 6 - TRANSFERS AND REPURCHASES
SECTION 6.1. TRANSFER OF INTERESTS OF INVESTORS
(a) An Interest or portion thereof may be Transferred only (i) by
operation of law resulting from an Investor's death, disability, dissolution,
bankruptcy or incompetence or (ii) with the written consent of the Board of
Directors or the Adviser, which consent may be withheld in each of its sole
discretion and shall not be subject to challenge by any potential assignor or
assignee. For the avoidance of doubt this Section 6.1(a) shall not be deemed to
restrict actions otherwise permitted by Section 6.3.
(b) Unless the Board of Directors or the Adviser consults with
counsel and counsel confirms that the Transfer will not cause the Fund to be
treated as a publicly traded partnership taxable as a corporation (which
confirmation shall be obtained at the expense of the transferor), the Board of
Directors or the Adviser generally may not consent to a Transfer of an Interest
unless the following conditions are met: (i) the transferring Investor has been
an Investor of the Fund for at least six months; (ii) the proposed Transfer is
to be made on the effective date of an offer by the Fund to repurchase
Interests; and (iii) the Transfer is (a) (1) one in which the tax basis of the
Interest in the hands of the transferee is expected to be determined, in whole
or in part, by reference to its tax basis in the hands of the transferring
Investor (e.g., gifts and contributions to family entities) and (2) to members
of the transferring Investor's immediate family (siblings, spouse, parents or
children) or (b) a distribution from a qualified retirement plan or an
individual retirement account.
(c) Unless otherwise waived by the Board of Directors or the
Adviser in each of its sole discretion, any Transfer shall be made only upon the
receipt by the Fund of an Opinion of Counsel (which opinion shall be obtained at
the expense of the transferor) that the Transfer will be made pursuant to an
available exemption from registration under the 1933 Act and applicable state
securities laws and of an executed, complete and satisfactory Subscription
Agreement. An Investor who Transfers all or any portion of an Interest in any
manner may be charged reasonable expenses, including attorneys' and accountants'
fees, incurred by the Fund in connection with the Transfer.
(d) Any transferee acquiring an Interest by operation of law as a
result of the death, disability, dissolution, bankruptcy or incompetence of an
Investor or otherwise will be entitled to the allocations and distributions
allocable to the Interest so acquired, to Transfer all or any portion of an
Interest in accordance with the terms of this Agreement and to tender all or any
portion of an Interest for repurchase by the Fund, but will not be entitled to
the other rights of an Investor unless and until the transferee becomes a
substituted Investor of the Fund. If an Investor Transfers its Interest with the
approval of the Board of Directors or the Adviser, the Fund will take all
necessary actions so that each transferee or successor to whom the Interest is
Transferred is admitted to the Fund as an Investor.
(e) In subscribing for an Interest, an Investor agrees to
indemnify and hold harmless the Fund, the General Partner, the Board of
Directors, the Adviser, the Subadviser, each other Investor and their Affiliates
against all losses, claims, damages, liabilities, costs and expenses (including
legal or other expenses incurred in investigating or defending against any
losses,
17
claims, damages, liabilities, costs and expenses or any judgments, fines and
amounts paid in settlement), joint or several, to which those persons may become
subject by reason of or arising from any Transfer made by that Investor in
violation of these provisions or any misrepresentation made by that Investor in
connection with any Transfer.
SECTION 6.2. WITHDRAWAL AND EXPULSION OF INVESTORS
(a) Except as provided below, an Investor may not withdraw from
the Fund (whether voluntarily, by operation of law or otherwise) prior to the
dissolution and winding up of the Fund except in connection with a transfer of
its Interest and substitution of another Person as Investor, or repurchase of
such Investor's Interest, pursuant to, and in compliance with, the provisions of
Article 6 of this Agreement.
(b) An Investor may be expelled as an Investor by the Board of
Directors in connection with a repurchase of such Investor's entire Interest
pursuant to Section 6.3(b) or 6.3(c).
(c) After the Fund commences operations, an Investor shall be
deemed to have withdrawn from the Fund at such time as such Investor's Capital
Account balance is reduced to zero dollars.
SECTION 6.3. REPURCHASE OF INTERESTS
(a) Except as otherwise provided in this Agreement, no Investor or
other person holding an Interest or portion thereof shall have the right to
withdraw, require redemption of such Interest or tender to the Fund for
repurchase that Interest or portion thereof. Any repurchases of Interests or
portions thereof will be made pursuant to written tenders and at times and on
terms and conditions as the Board of Directors may determine in its sole
discretion.
(b) The Board of Directors may cause the Fund to repurchase an
Interest or portion thereof of an Investor or any person acquiring an Interest
or portion thereof from or through an Investor without consent or other action
by the Investor or other person, or cause an Investor to sell all or a portion
of its Interest to another Investor or Person, at the most recently calculated
net asset valuation of such Investor's Capital Account balance, for any reason
deemed advisable by the Board of Directors, including but not limited to
situations in which:
(i). such an Interest or portion thereof has been
transferred in violation of Section 6.1 hereof, or such an Interest or
portion thereof has vested in any person other than by operation of law
as the result of the death, disability, dissolution, bankruptcy or
incompetence of an Investor;
(ii). ownership of the Interest or portion of the Interest
by an Investor or other person is likely to cause the Fund to be in
violation of, or require registration of all or any portion of any
Interest under, or subject the Fund to additional registration or
regulation under, the securities, commodities or other laws of the
United States or any other relevant jurisdiction, or may subject the
Fund or any Investor to an undue risk of adverse tax consequence (such
as the Fund's no longer being taxed as a partnership rather than an
association taxable as a corporation) or other fiscal or regulatory
consequences;
18
(iii). continued ownership of the Interest or portion of it
by the Investor or other person may be harmful or injurious to the
business of the Fund, the Board of Directors, the Adviser or Subadviser
or prevent the Adviser or Subadviser from receiving any fees in respect
of the Fund or such Investor;
(iv). any of the representations and warranties made by an
Investor in connection with the acquisition of an Interest or portion
of an Interest was not true when made or has ceased to be true;
(v). the value of an Investor's Interest is less than an
amount that the Board of Directors determines to be a minimum
investment in the Fund, or more than an amount that the Board of
Directors determines to be a maximum investment in the Fund; or
(vi). it would be in the best interests of the Fund, as
determined by the Board of Directors in its sole discretion, for the
Fund to repurchase such an Interest or portion thereof.
(c) Repurchases of Interests or portions thereof by the Fund shall
be payable at such time and in such manner as the Board of Directors in its
discretion shall determine. Payment of the purchase price for an Interest or
portion thereof may consist of: (i) cash or a promissory note (which need not
bear interest), or a combination thereof, in an amount equal to such percentage,
as may be determined by the Board of Directors, of the estimated unaudited net
asset value of the Interest (or portion thereof) repurchased by the Fund
determined as of the date of such repurchase (the "Initial Payment"); and, if
determined to be appropriate by the Board of Directors or if the Initial Payment
is less than 100% of the estimated unaudited net asset value of the repurchased
Interest, (ii) a contingent payment to be made at a date subsequent to the date
of the Initial Payment in cash or a promissory note (which need not bear
interest), or a combination thereof, equal to the excess, if any, of (x) the net
asset value of the Interest (or portion thereof) repurchased by the Fund as of
the date of such repurchase, as subsequently determined (which determination may
but need not be based on the audited financial statements of the Fund for the
Fiscal Year in which such repurchase was effective) over (y) the Initial
Payment. Each Investor, by its execution of this Agreement (or of a Subscription
Agreement pursuant to Section 5.1 hereof) hereby expressly grants to the Board
of Directors the authority to determine the terms of the promissory notes
referred to in the preceding sentence. Notwithstanding anything to the contrary,
the Fund, in the discretion of the Board of Directors, may pay all or any
portion of the repurchase price in Securities or other property (or any
combination of Securities, other property and cash) of equivalent value. All
such repurchases shall be subject to any and all conditions as the Board of
Directors may impose, including any condition with respect to maintaining a
minimum Capital Account balance, and shall be effective as of a date set by the
Board of Directors, which date shall be after the date set for receipt by the
Fund of all eligible written tenders of Interests or portions thereof. The
amount due to any Investor whose Interest or portion thereof is repurchased
shall reflect all allocations to be made to such Investor's Capital Account as
of the effective date of such repurchase.
(d) Subject to the approval of the Board of Directors and
compliance with the 1940 Act, the Fund may impose a redemption fee in connection
with repurchases of Interests (or portions thereof), including a fee applicable
to repurchases of Interests (or portions thereof)
19
effected prior to the expiration of a specified period subsequent to an
Investor's admission to the Fund.
SECTION 6.4. CONVERSION TO OPEN END MANAGEMENT INVESTMENT COMPANY
Notwithstanding any other provisions in this Agreement or the Bylaws,
the conversion of the Fund from a "closed-end company" to an "open-end company,"
as those terms are defined in Sections 5(a)(2) and 5(a)(1), respectively, of the
1940 Act, together with any necessary amendments to this Agreement to permit
such a conversion, shall require the affirmative vote or consent of Investors
whose Capital Account balances represent in the aggregate at least two-thirds of
the total balance of all Capital Accounts entitled to vote on the matter, unless
a majority of the Board of Directors and seventy-five percent (75%) of the
Directors who are not "interested persons" of the Fund, as such term is defined
in the 1940 Act, approve such conversion and related actions. In the event of
such approval by the Board of Directors as referred to in the preceding
sentence, the 1940 Act shall govern whether and to what extent a vote or consent
of Investors shall be required to approve such conversion and related actions.
Any requirement for an affirmative vote or consent under this Section 6.4 shall
be in addition to any requirement for a vote or consent of the Investors
pursuant to applicable law or any agreement between the Fund and any national
securities exchange.
ARTICLE 7 - TERM AND DISSOLUTION OF THE FUND
SECTION 7.1. TERM
Except as otherwise provided in this Section 7.1, the Fund shall have
perpetual existence. The Fund shall be dissolved upon the happening of: (i) the
written determination of the Board of Directors to dissolve the Fund; (ii) the
entry of a decree of judicial dissolution under Section 17-802 of the Delaware
Act; or (iii) the withdrawal of the General Partner, unless (a) at such time
there remains at least one general partner who elects to continue the business
of the Fund, (b) the Board of Directors, by majority vote, elects to continue
the business of the Fund and appoint, effective as of the date of the General
Partner's withdrawal, one or more additional general partners or (c) within 90
days after the withdrawal, Investors whose Capital Account balances represent in
the aggregate at least a majority of the total balance of all Capital Accounts
entitled to vote, elect to continue the business of the Fund and appoint,
effective as of the date of the General Partner's withdrawal, one or more
additional general partners.
SECTION 7.2. EVENTS NOT CAUSING DISSOLUTION
The withdrawal, resignation, expulsion, death, insanity, incompetency,
bankruptcy, insolvency, dissolution or liquidation of, or the making of an
assignment for the benefit of creditors by, or any other act or circumstance
with respect to, an Investor shall not cause the dissolution of the Fund; the
Investors shall not otherwise have the right to cause a dissolution of the Fund;
and the Fund shall continue until dissolved pursuant to Section 7.1 hereof.
ARTICLE 8 - LIQUIDATION OF THE FUND
On dissolution of the Fund, the Board of Directors shall have full
power and authority to liquidate and distribute (in cash or in kind) the Net
Assets of the Fund to the Investors in
20
accordance with Section 5.9. Any such distribution shall be made solely from the
Fund's assets. Each Investor shall be furnished with a statement which shall set
forth the assets and liabilities of the Fund as at the date of complete
liquidation, and each Investor's share thereof. Following the payment or
discharge, or the making of reasonable provision for the payment or discharge,
of the Fund's liabilities (including contingent liabilities), and the
distribution of the Fund's assets, the Investors shall cease to be such, and a
certificate of cancellation for the Fund shall be filed with the office of the
Secretary of State of the State of Delaware.
ARTICLE 9 - ACCOUNTING AND REPORTING PROVISIONS
SECTION 9.1. BOOKS AND ACCOUNTS
Consistent with the requirements of applicable law, complete and
accurate books and accounts shall be kept and maintained for the Fund at its
principal place of business or at such other place as the Board of Directors may
determine in its sole discretion. Such books and accounts shall be kept on the
accrual basis method of accounting in accordance with generally accepted
accounting principles and shall include separate accounts for each Investor. The
Fund's accounts shall be kept in U.S. currency unless determined otherwise by
the Board of Directors.
SECTION 9.2. TAX ELECTIONS
Any election required or permitted to be made by the Fund under the
Code is permitted to be made by the Board of Directors or the Adviser, to the
extent permitted hereunder, in each of its sole discretion. The Board of
Directors or the Adviser is each further permitted to make any tax election
(including a "check-the-box" election for a prior period pursuant to Section
7701 of the Code, even if one or more Persons who were Investors during any
portion of such prior period are not Investors as of the date of such election)
with respect to the Fund on behalf of an Investor or a former Investor. Each
Investor hereby consents to any such election.
SECTION 9.3. TAX MATTERS PARTNER
The tax matters partner, as defined in Section 6231 of the Code, of the
Fund shall be any Investor or such other Person as designated by the Board of
Directors (the "Tax Matters Partner"). All expenses incurred by the Tax Matters
Partner in connection with the Fund shall be borne by the Fund. Any Person who
serves as Tax Matters Partner shall not be liable to the Fund or any Investor
thereof 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 Fund, unless such action
or failure to act constitutes willful misfeasance, bad faith, gross negligence
or reckless disregard of the duties involved in the conduct of such office. The
Fund (but not the Investors themselves) shall indemnify the Tax Matters Partner
as provided in Section 3.4 to the same extent as if the Tax Matters Partner were
a Covered Person.
SECTION 9.4. VALUATION OF ASSETS
(a) Except as may be required by the 1940 Act, the Board of
Directors shall value or have valued any Securities held by the Fund and any
other assets and liabilities of the Fund as of the close of business on the last
day of each Fiscal Period (and as of any other date determined
21
by the Board of Directors) in accordance with such valuation procedures as shall
be established from time to time by the Board of Directors and which conform to
the requirements of the ▇▇▇▇ ▇▇▇.
(b) The value of Securities held by the Fund and other assets and
liabilities of the Fund determined pursuant to this Section 9.4 shall be
conclusive and binding on all of the Investors and all parties claiming through
or under them.
ARTICLE 10 - GENERAL PARTNER
SECTION 10.1. GENERAL PARTNER
The initial General Partner is SEI Funds, Inc., a Delaware corporation.
Such General Partner is initially the sole general partner of the Fund and is
admitted without acquiring an Interest in the Fund; provided however, that
nothing herein shall prevent the General Partner from acquiring an Interest in
the Fund, in its capacity as a general partner of the Fund, upon the creation of
such interests by the Board of Directors.
SECTION 10.2. ADDITIONAL GENERAL PARTNERS
Additional general partners may only be admitted to the Fund with the
prior written consent of the General Partner and the Board of Directors or in
accordance with Section 7.1 hereof.
SECTION 10.3. WITHDRAWAL OF GENERAL PARTNER
The General Partner may withdraw from the Fund at any time, in its sole
discretion, by giving one year's prior written notice to the Board of Directors.
SECTION 10.4. NO RIGHT OF REMOVAL OF GENERAL PARTNER
No Director or Investor shall have the right, power or authority to
remove the General Partner or cause the General Partner to withdraw from the
Fund, except to the extent such right, power or authority may be conferred on
them by law.
ARTICLE 11 - MISCELLANEOUS PROVISIONS
SECTION 11.1. PRINCIPAL PLACE OF BUSINESS; REGISTERED AGENT AND OFFICE
The principal business office of the Fund shall be ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇, ▇▇ ▇▇▇▇▇, or such other place as the Board of Directors may
designate from time to time. The Fund may also maintain additional offices at
such place or places as the Board of Directors may designate from time to time.
The Fund's registered agent and office in Delaware shall be The Corporation
Trust Company, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇. At any time, the
Board of Directors may designate another registered agent and/or registered
office in Delaware.
22
SECTION 11.2. FORCE MAJEURE
Whenever any act or thing is required of the Fund, the General Partner,
the Board of Directors or the Adviser hereunder to be done within any specified
period of time, the Fund, the General Partner, the Directors or the Adviser, as
applicable, shall be entitled to such additional period of time to do such act
or thing as shall equal any period of delay resulting from causes beyond the
reasonable control of the Fund, the General Partner, the Directors or the
Adviser, including, without limitation, bank holidays, actions of governmental
agencies and financial crises of a nature materially affecting the purchase and
sale of Securities or other property; provided that this provision shall not
have the effect of relieving the Fund, the General Partner, the Directors or the
Adviser from the obligation to perform any such act or thing.
SECTION 11.3. APPLICABLE LAW
This Agreement shall be governed by, and construed in accordance with,
the laws of the State of Delaware, and all rights and remedies shall be governed
by such laws without regard to principles of conflict of laws.
SECTION 11.4. PROVISIONS IN CONFLICT WITH LAW OR REGULATION
The provisions of this Agreement are severable, and if the Board of
Directors shall determine, with the advice of counsel, that any of such
provisions is in conflict with the 1940 Act, the Code, the Delaware Act, or with
other applicable laws and regulations, the conflicting provision shall be deemed
not to have constituted a part of this Agreement from the time when such
provisions became inconsistent with such laws or regulations; provided, however,
that such determination shall not affect any of the remaining provisions of this
Agreement or render invalid or improper any action taken or omitted prior to
such determination.
SECTION 11.5. WAIVERS
No waiver of the provisions hereof shall be valid unless in writing and
signed by the party to be bound and then only to the extent therein set forth.
Except as specifically herein provided, no failure or delay by any party in
exercising any right or remedy hereunder shall operate as a waiver thereof, and
a waiver of a particular right or remedy on one occasion shall not be deemed a
waiver of any other right or remedy or a waiver on any subsequent occasion.
SECTION 11.6. CONSTRUCTION
(a) The captions used herein are intended for convenience of
reference only and shall not modify or affect in any manner the meaning or
interpretation of any of the provisions of this Agreement.
(b) As used herein, the singular shall include the plural, the
masculine and feminine shall include the neuter, and the neuter gender shall
include the masculine and feminine, unless the context otherwise requires.
23
(c) The words "hereof," "herein" and "hereunder," and words of
similar import, when used in this Agreement, shall refer to this Agreement as a
whole and not to any particular provision of this Agreement.
SECTION 11.7. AMENDMENTS
(a) Except as otherwise provided in this Section 11.7, this
Agreement may be amended, in whole or in part, at any time by an instrument in
writing signed by a majority of the then Directors (including, if required by
the 1940 Act, the vote of a majority of the Directors who are not "interested
persons," as that term is defined in the ▇▇▇▇ ▇▇▇) and, if required by the 1940
Act, the authorization by a vote of a "majority of the outstanding voting
securities" of the Fund (or such higher percentage as may be required by the
1940 Act), as such term is defined in the 1940 Act.
(b) Any amendment that would: (i) increase the obligation of an
Investor to make any contribution to the capital of the Fund; or (ii) reduce the
Capital Account of an Investor other than in accordance with the provisions of
this Operating Agreement, may be made only if (x) the written consent of each
Investor adversely affected thereby is obtained prior to the effectiveness
thereof or (y) such amendment does not become effective until (A) each Investor
has received written notice of such amendment and (B) any Investor objecting to
such amendment has been afforded a reasonable opportunity (pursuant to such
procedures as may be prescribed by the Board of Directors) to tender its entire
Interest for repurchase by the Fund.
(c) The power of the Board of Directors to amend this Agreement at
any time without the consent of the Investors as set forth in paragraph (a) of
this Section 11.7 shall specifically include the power to amend this Agreement
for the purpose of: (i) changing the name of the Fund; (ii) supplying any
omission, curing any ambiguity or curing, correcting or supplementing any
defective or inconsistent provision contained herein; (iii) ensuring compliance
with applicable laws or regulations; (iv) making changes necessary or advisable
under applicable tax laws or regulations; (v) restating this Agreement together
with any amendments hereto that have been duly adopted in accordance herewith to
incorporate such amendments in a single, integrated document; or (vi) making any
non-material change.
(d) The Certificate of Limited Partnership of the Fund may be
restated and/or amended by the General Partner, and any such restatement and/or
amendment shall be effective immediately upon filing with the office of the
Secretary of State of the State of Delaware or upon such future date and time as
may be stated therein.
(e) The Board of Directors shall cause written notice to be given
of any amendment to this Agreement (other than any amendment of the type
contemplated in clause (v) of Section 11.7(c) hereof) to each Investor, which
notice shall set forth the text of the amendment or a summary thereof and a
statement that the text thereof will be furnished to any Investor upon request.
SECTION 11.8. EXECUTION
This Agreement may be executed in any number of counterparts, and all
such counterparts together shall constitute one agreement binding on all the
Investors.
24
SECTION 11.9. BINDING EFFECT
This Agreement shall be binding upon and shall inure to the benefit of
the respective heirs, executors, administrators, legal representatives,
successors and assigns of the parties hereto; provided that this provision shall
not be construed to permit any assignment or transfer which is otherwise
prohibited hereby.
SECTION 11.10. SEVERABILITY
If any one or more of the provisions contained in this Agreement, or
any application thereof, shall be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
contained herein and all other applications thereof shall not in any way be
affected or impaired thereby.
SECTION 11.11. CONFIDENTIAL INFORMATION
Without the consent of the Board of Directors, which consent may be
withheld in its sole discretion, each Investor shall not, and shall use
reasonable efforts to ensure that every person connected with or associated with
each such Investor (including attorneys, accountants and other advisors) shall
not, disclose to any person, firm or corporation (other than such Investor's
attorneys, accountants and other advisors for the purpose of monitoring or
administering such Investor's investment in the Fund, provided that such
attorneys, accountants and other advisors shall be required by such Investor to
observe the provisions of this Section 11.11 with respect to such confidential
information) or use to the detriment of the Fund or any of the Investors any
confidential information concerning the affairs of the Fund, unless required to
do so by any applicable law or to comply with applicable regulatory requirements
or guidelines, provided that such Investor provides the Fund with prior notice
sufficient to afford the Fund an opportunity to contest such disclosure or use
in any applicable judicial or administrative forum. Confidential information
concerning the Fund shall be construed broadly and shall include, without
limitation, information relating to direct or indirect investments made by the
Fund, financial reports by the Fund, correspondence of the Fund with Investors,
the name and/or address (whether business, residence or mailing) of any other
Investor and information communicated to the Fund by investment vehicles in
which the Fund has an interest. Each Investor agrees that monetary damage would
not be a sufficient remedy for breach of this Section 11.11 by such Investor,
and that in addition to any other remedies available to the Fund in respect of
such breach, the Fund shall be entitled to specific performance and injunctive
or other equitable relief as a remedy for any such breach. Notwithstanding any
provision in this Agreement to the contrary, an Investor (and any employee,
representative, or other agent of such Investor) may disclose to any and all
persons, without limitation of any kind, information concerning the tax
treatment and tax structure of the Fund and its investments and all materials of
any kind (including opinions or other tax analyses) that are provided to such
Investor relating to such tax treatment and tax structure.
SECTION 11.12. POWER OF ATTORNEY
Each Investor, by its execution of this Agreement (or of a Subscription
Agreement pursuant to Section 5.1 hereof), hereby irrevocably makes, constitutes
and appoints each of the
25
General Partner, the Fund's Directors and officers and the Adviser as such
Investor's true and lawful agent and attorney-in-fact, with full power of
substitution and full power and authority in its name, place and stead, acting
singly, to make, execute, sign, acknowledge, swear to, record and file: (i) the
Certificate of Limited Partnership of the Fund and all amendments thereto
required by law or permitted by law and the provisions of this Agreement; (ii)
all certificates required or desirable in connection with distributions by the
Fund to the Investors and other certificates and instruments deemed advisable by
any Director or officer of the Fund or the Adviser to carry out the provisions
of this Agreement and any applicable law; (iii) all instruments that any
Director or officer of the Fund or the Adviser deems appropriate to reflect an
amendment, change or modification of this Agreement in accordance with this
Agreement, including, without limitation, the admission of additional Investors
or the substitution of assignees as Investors pursuant to the provisions of this
Agreement; (iv) all conveyances and other instruments or papers deemed advisable
by the Board of Directors, including, without limitation, those to effect a
termination of the Fund and those to effect a permitted Transfer of all or a
part of such Investor's Interest, or a repurchase of all or part of such
Investor's Interest pursuant to Section 6.3; (v) all other instruments,
documents or papers which may be required or permitted by law to be filed on
behalf of the Board of Directors or the Fund and which are of a ministerial or
administrative nature; and (vi) any election described in Section 9.2.
Each Investor is aware that the terms of this Agreement permit certain
amendments to this Agreement to be effected and certain other actions to be
taken or omitted by or with respect to the Fund without such Investor's consent.
If an amendment to the Certificate of Limited Partnership or this Agreement or
any other action by or with respect to the Fund is taken in the manner
contemplated by this Agreement, each Investor agrees that, notwithstanding any
objection that such Investor may assert with respect to such amendment or
action, the attorneys in fact appointed hereby are authorized and empowered,
with full power of substitution, to exercise the authority granted above in any
manner that may be deemed necessary or appropriate to permit such amendment to
be made or action lawfully taken or omitted. Each Investor is fully aware that
each Investor will rely upon the effectiveness of this special power of attorney
with a view to the orderly administration of the Fund.
This power of attorney is a special power of attorney and is coupled
with an interest in favor of each of the General Partner, the Fund's Directors
and officers and the Adviser and as such shall be irrevocable and continue in
full force and effect notwithstanding the subsequent death or incapacity of any
party granting this power of attorney, regardless of whether the General
Partner, the Fund, its Directors or officers or the Adviser have had notice
thereof, and shall survive the delivery of a Transfer by an Investor of the
whole or any portion of such Investor's Interest, except that where the
transferee has been approved by the Board of Directors or Adviser for admission
to the Fund as a substituted Investor, this power of attorney given by the
transferor shall survive the delivery of such assignment for the sole purpose of
enabling the Fund's Directors or officers or the Adviser to execute, acknowledge
and file any instrument necessary to effect such substitution.
SECTION 11.13. MERGER AND CONSOLIDATION; CONVERSION
(a) The Fund may merge or consolidate with or into one or more
limited partnerships formed under the Delaware Act or other business entities
pursuant to an agreement of merger or
26
consolidation that has been approved in the manner contemplated by Section
17-211 of the Delaware Act.
(b) Notwithstanding anything to the contrary contained herein, an
agreement of merger or consolidation approved in accordance with Section
17-211(b) of the Delaware Act may, to the extent permitted by Section 17-211(g)
of the Delaware Act, (i) effect any amendment to this Agreement, (ii) effect the
adoption of a new partnership agreement for the Fund if it is the surviving or
resulting limited partnership in the merger or consolidation, or (iii) provide
that the partnership agreement of any other constituent limited partnership to
the merger or consolidation (including a limited partnership formed for the
purpose of consummating the merger or consolidation) shall be the partnership
agreement of the surviving or resulting limited partnership.
(c) The Board of Directors may, without the vote of the Investors,
(i) cause the Fund to convert to a corporation, statutory trust or association,
a real estate investment trust, a common-law trust, a general partnership
(including a limited liability partnership) or a limited liability company,
organized, formed or created under the laws of the State of Delaware, as
permitted pursuant to Section 17-219 of the Delaware Act and (ii) in connection
with any such conversion, to cause any outstanding Interests to be exchanged or
converted into securities of or interests in the business form into which the
Fund is converted under or pursuant to any state or federal statute to the
extent permitted by law.
SECTION 11.14. APPLICABILITY OF 1940 ACT AND REGISTRATION STATEMENT
The parties hereto acknowledge that this Agreement is not intended to,
and does not, set forth the substantive provisions contained in the 1940 Act and
the Fund's Registration Statement on Form N-2 filed with the Commission, as
amended from time to time, that affect numerous aspects of the conduct of the
Fund's business and of the rights, privileges and obligations of the Investors.
Each provision of this Agreement shall be subject to and interpreted in a manner
consistent with the applicable provisions of the 1940 Act and such Registration
Statement.
SECTION 11.15. DISCRETION
To the fullest extent permitted by law, whenever in this Agreement a
Person is permitted or required to make a decision (i) in his, her or its "sole
discretion" or "discretion" or under a grant of similar authority or latitude,
such Person shall be entitled to consider only such interests and factors as
such Person desires, including such Person's own interests, and shall have no
duty or obligation to give any consideration to any interest of or factors
affecting the Fund or the Investors, or (ii) in its "good faith" or under
another express standard, then such Person shall act under such express standard
and shall not be subject to any other or different standards imposed by this
Agreement or any other agreement contemplated herein or by relevant provisions
of law or in equity or otherwise.
[Remainder of this page intentionally left blank.]
27
IN WITNESS WHEREOF, the parties named below have executed this
Agreement as of the date first written above.
SEI Funds, Inc.
as General Partner
By:______________________________
Name:
Title:
SEI Opportunity Fund, L.P.
as Investor
By:______________________________
Name:
Title:
Signature Page to Agreement of Limited Partnership
of SEI Opportunity Master Fund, L.P.
APPENDIX A
DEFINITIONS
"1933 Act" shall mean the Securities Act of 1933, as amended.
"1940 Act" shall mean the Investment Company Act of 1940, as amended.
"Adviser" shall mean the Person or Persons selected from time to time
by the Board of Directors to provide investment advisory or investment
management services pursuant to an investment management agreement and which
Person is, initially, SEI.
"Affiliate" shall mean, with respect to any Person, a Person
controlling, controlled by or under common control with such Person. For this
purpose, "control" shall have the definition given in the 1940 Act.
"Agreement" shall be as defined in the preamble hereof.
"Board of Directors" shall be as defined in Section 3.1(a).
"Business Day" shall mean any day on which the New York Stock Exchange
is open for business or such other day classified as a business day according to
such criteria as the Board of Directors may in its absolute discretion adopt
from time to time.
"Bylaws" shall mean the By-Laws of the Fund, as adopted by the Board of
Directors and as from time to time in effect.
"Capital Account" shall mean, as to each Investor, the capital account
maintained on the books of the Fund for such Investor.
"Capital Contribution" shall mean, as to each Investor as of the time
of determination, the sum of the Investor's initial capital contribution to the
Fund pursuant to Section 5.1 and further amounts contributed to the Fund by the
Investor. In no event shall the Capital Contribution of an Investor include any
cash paid or contributed to the Fund denominated in this Agreement or otherwise
as fees, expenses, interest or penalties, regardless of the treatment of such
amounts for federal income tax purposes.
"Certificate of Conversion from a Limited Liability Company to a
Limited Partnership" shall mean the certificate of conversion from a limited
liability company to a limited partnership filed with the office of the
Secretary of State of the State of Delaware by the Fund under the name "SEI
Opportunity Master Fund, LLC" to effectuate the conversion of the Fund from a
Delaware limited liability company to a Delaware limited partnership pursuant to
Section 18-216 of the Delaware LLC Act.
"Certificate of Limited Partnership" shall mean the certificate of
limited partnership filed on behalf of the Fund with the office of the Secretary
of State of the State of Delaware as required under the Delaware Act to form the
Fund and any and all amendments and corrections thereto and restatements
thereof.
A-1
"Closing Date" shall mean the first date on which Persons are admitted
as Investors of the Fund, which date shall be determined by the Adviser in its
sole discretion.
"Code" shall mean the United States Internal Revenue Code of 1986, as
from time to time amended, and any successor thereto.
"Commission" shall mean the United States Securities and Exchange
Commission or any successor thereto.
"Covered Person" shall be as defined in Section 3.4(a).
"Delaware Act" shall mean the Delaware Revised Uniform Limited
Partnership Act, 6 Del. C. Sections 17-101-17-1111, as amended from time to
time, and any legislative enactment which may replace or supersede such Act.
"Delaware LLC Act" shall mean the Delaware Limited Liability Company
Act, 6 Del. C. Sections 18-101-18-1109, as in effect on the date hereof.
"Director" shall be as defined in Section 3.1(b).
"Fiscal Period" shall mean the period commencing on the Closing Date,
and thereafter each period commencing on the day immediately following the last
day of the preceding Fiscal Period, and ending on such date as is determined by
the Board of Directors or the Adviser from time to time.
"Fiscal Year" shall be as defined in Section 2.4.
"Fund" shall be as defined in the preamble hereof.
"Fund Expenses" shall mean all expenses, fees, charges, taxes and
liabilities incurred or arising in connection with the Fund, or in connection
with the management thereof, including, but not limited to, the General
Partner's compensation, the Directors' compensation and such expenses and
charges for the services of the Fund's General Partner, officers, employees, any
investment adviser of the Fund, any Director, principal underwriter, auditor,
counsel, custodian, transfer agent, shareholder servicing agent and such other
agents or independent contractors and such other expenses and charges (including
Organizational Expenses) as the Board of Directors may deem necessary or proper
to incur.
"General Partner" shall mean, initially, SEI Funds, Inc., and any duly
admitted successor, and any additional party admitted, as general partner of the
Fund.
"Initial Payment" shall be as defined in Section 6.3(c).
"Interest" means the entire ownership interest in the Fund at any
particular time of an Investor, or other person to whom an Interest or portion
thereof has been Transferred pursuant to Section 6.1 hereof, including the
rights and obligations of such Investor or other person under this Agreement and
the Delaware Act.
"Investor" shall mean any Person who is admitted to the Fund as a
limited partner.
A-2
"Net Assets" shall mean the total value of all assets of the Fund, less
an amount equal to all accrued debts, liabilities and obligations of the Fund.
"Net Profit" or "Net Loss" shall mean, for a Fiscal Period, the amount
by which the Net Assets as of the close of business on the last day of such
Fiscal Period (determined after giving effect to all fees and expenses,
including accrued and unpaid management fees, if any, but before giving effect
to any distributions and repurchases on such date) exceed (in the case of Net
Profit) or are less than (in the case of Net Loss) the Net Assets as of the
commencement of the same Fiscal Period (determined after giving effect to any
distributions or repurchases for the preceding Fiscal Period and Capital
Contributions for the current Fiscal Period) or, with respect to the initial
Fiscal Period of the Fund, at the close of business on the Closing Date, such
amount to be adjusted to exclude any items to be allocated among the Capital
Accounts of Investors on a basis which is not in accordance with their
proportionate opening Capital Account balances for such Fiscal Period.
"Opinion of Counsel" shall mean an opinion in writing and in form and
substance reasonably satisfactory to the Adviser, signed by legal counsel either
chosen by the Adviser or, if chosen by an Investor, reasonably satisfactory to
the Adviser.
"Organizational Expenses" shall mean expenses incurred by the Fund in
connection with its formation (including its conversion from a Delaware limited
liability company to a Delaware limited partnership), its initial registration
as a closed-end investment company under the 1940 Act with the Commission and
the initial offering of Interests.
"Person" shall include a corporation, limited liability company,
association, organization, joint venture, partnership, trust or individual.
"Security" means any "security" (as that term is defined in Section
2(a)(36) of the 1940 Act), any contracts for forward or future delivery of any
such security, any currency or any commodity, all manner of derivative
instruments and any contracts based on any index or group of securities,
currencies or commodities, and any options on any of the foregoing.
"SEI" shall be as defined in Section 3.3.
"Subadviser" shall mean any Person or Persons who from time to time
shall have contracted with the Adviser to provide investment advisory or
investment management services to the Fund pursuant to an investment subadvisory
agreement.
"Subscription Agreement" shall mean, as to each Investor, the
subscription agreement or other instrument delivered by such Investor and
accepted by the Board of Directors (or its designated agent) in respect of such
Investor's investment in the Fund.
"Tax Matters Partner" shall be as defined in Section 9.3.
"Transfer" shall mean the assignment, transfer, sale, mortgage,
encumbrance, pledge, conveyance or other disposition of all or any portion of an
Interest, including any right to receive any allocations and distributions
attributable to an Interest.
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"Treasury Regulations" shall mean the federal income tax and procedure
and administration regulations as promulgated by the U.S. Treasury Department,
as in effect from time to time.
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