Exhibit 10.1
AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT OF
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ AAA ENERGY FUND ▇.▇. ▇▇
This Amended and Restated Limited Partnership Agreement (this "Agreement"),
dated and effective as of January 9, 2007, is by and among Citigroup Managed
Futures LLC, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ - 25th floor, New York, New York 10022 (the
"General Partner"), AAA Capital Management Advisors, Ltd. (the "Special Limited
Partner") and ▇▇▇▇▇ ▇. ▇▇▇▇▇ (the "Initial Limited Partner") and those other
parties who shall execute this Agreement, whether in counterpart or by
attorney-in-fact, as limited partners. (The Initial Limited Partner and such
other parties are hereinafter collectively referred to as the "Limited
Partners". The General Partner and the Limited Partners may be collectively
referred to herein as "Partners.") This Agreement amends and restates the
Partnership's limited partnership agreement, dated as of March 25, 2002 (the
"Initial Agreement"), by and among the General Partner, the Special Limited
Partner, the Initial Limited Partner and the other limited partners party
thereto.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to a proxy statement distributed to the Limited Partners
on or about July 11, 2006, the General Partner requested the Limited Partners'
approval of an amendment to the Initial Agreement in order to change the profit
share allocation due to the Special Limited Partner so that the allocation is
made quarterly rather than annually; and
WHEREAS, the General Partner and the requisite Limited Partners, consistent
with the requirements of Section 18(a) of the Limited Partnership Agreement,
have approved such amendment to the Initial Agreement.
NOW, THEREFORE, in consideration of the mutual premises and agreements
herein made and intending to be legally bound hereby, the parties hereto agree
to amend and restate the Initial Agreement in its entirety as follows:
1. Formation and Name.
The parties hereto hereby form a limited partnership under the New York
Revised Uniform Limited Partnership Act. The name of the limited partnership is
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney AAA Energy Fund ▇.▇. ▇▇ (the "Partnership"). The General
Partner shall execute and file a Certificate of Limited Partnership in
accordance with the provisions of the New York Revised Limited Partnership Act
and execute, file, record and publish, as appropriate, such amendments,
restatements and other documents as are or become necessary or advisable, as
determined by the General Partner. As used herein, "Partnership Act" means the
New York Revised Uniform Limited Partnership Act.
2. Principal Office.
The principal office of the Partnership shall be ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ -
25th floor, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ or such other place as the General Partner
may designate from time to time.
3. Business.
(a) The Partnership's business and purpose is to trade, buy, sell or
otherwise acquire, hold or dispose of interests, directly or indirectly, in
commodities of all descriptions (including futures contracts, commodity options,
forward contracts, swaps and any other rights or interests pertaining thereto,
including interests in commodity pools). The objective of the Partnership
business is appreciation of its assets through speculative trading.
(b) The Partnership shall not:
(1) engage in the pyramiding of its positions by using unrealized
profits on existing positions as margin for the purchase or sale of additional
positions in the same or related commodities;
(2) utilize borrowings except short-term borrowings if the Partnership
takes delivery of cash commodities; or
(3) permit the churning of its account.
(c) The Partnership shall make no loans. Assets of the Partnership will not
be commingled with assets of any other entity. Deposit of assets with a
commodity broker or dealer as margin shall not constitute commingling.
4. Term, Dissolution and Fiscal Year.
(a) Term. The term of the Partnership shall commence on the date the
Certificate of Limited Partnership is filed in the office of the County Clerk of
New York County, State of New York, and shall end as soon as practicable upon
the first to occur of the following: (1) December 31, 2022; (2) receipt by the
General Partner of an election to dissolve the Partnership at a specified time
by Limited Partners owning more than 50% of the Units of Limited Partnership
Interest then outstanding, notice of which is sent by registered mail to the
General Partner not less than 90 days prior to the effective date of such
dissolution; (3) assignment by the General Partner of all of its interest in the
Partnership, withdrawal, removal, bankruptcy or any other event that causes the
General Partner to cease to be a general partner under the Partnership Act
(unless the Partnership is continued pursuant to Paragraph 17); (4) a decline in
Net Asset Value on any business day after trading to less than $400 per Unit; or
(5) any event which shall make it unlawful for the existence of the Partnership
to be continued.
(b) Dissolution. Upon dissolution of the Partnership, the assets of the
Partnership shall be distributed to creditors, including any Partners who may be
creditors, to the extent otherwise permitted by law, in satisfaction of
liabilities of the Partnership (whether by payment or the making of reasonable
provision for payment thereof) other than liabilities for which reasonable
provision for payment has been made and liabilities for distributions to
Partners; to Partners and former Partners in satisfaction of liabilities for
distributions; and to Partners first for the return of their contributions and
second respecting their Partnership interests, in the proportions in which the
Partners share in distributions. Following distributions of the assets of the
Partnership, a Certificate of Cancellation for the Partnership shall be filed as
required by the Partnership Act.
(c) Fiscal Year. The fiscal year of the Partnership will commence on
January 1 and end on December 31 each year ("fiscal year"). Each fiscal year of
the Partnership is divided into four fiscal quarters commencing on the first day
of January, April, July and October ("fiscal quarter").
5. Net Worth of General Partner.
The General Partner agrees that, at all times after the termination of the
initial offering period of the Partnership's Units of Limited Partnership
Interest described in Paragraph 12 hereof (the "Private Placement"), so long as
it remains a general partner of the Partnership, it will maintain its Net Worth
at an amount not less than 5% of the total contributions to the Partnership by
all Partners. The General Partner also agrees, with respect to each additional
limited partnership of which it is general partner, to maintain a net worth
(excluding capital contributions to the additional partnership) at an amount not
less than 5% of the total contributions to the additional limited partnership.
In no event will the General Partner be required to maintain a net worth in
excess of $1,000,000.
For the purposes of this Paragraph 5, Net Worth shall be based upon current
fair market value of the assets of the General Partner. The requirements of this
Paragraph 5 may be modified if the General Partner obtains an opinion of counsel
for the Partnership that a proposed modification will not adversely affect the
classification of the Partnership as a partnership for federal income tax
purposes and will not violate any state securities or blue sky laws to which the
Partnership may be subject from time to time.
6. Capital Contributions and Units of Partnership Interest.
The General Partner shall contribute to the Partnership, immediately prior
to the date on which the Partnership commences trading operations and as
necessary thereafter, an amount at least equal to the greater of (a) 1% of
capital contributions or (b) $25,000. The General Partner's contribution shall
be evidenced by "Units of General Partnership Interest." The General Partner may
not make any transfer or withdrawal of its contribution to the Partnership while
it is General Partner which would reduce its aggregate percentage interest in
the Partnership to less than such required interest in the Partnership. Any
withdrawal of any such excess interest by the General Partner may be made only
upon not less than thirty (30) days' notice to the Limited Partners prior to the
end of a fiscal quarter.
Interests in the Partnership, other than those of the General Partner,
shall be evidenced by "Units of Limited Partnership Interest" which the General
Partner on behalf of the Partnership shall, in accordance with the Private
Placement Offering Memorandum and Disclosure Document (the "Memorandum")
referred to in Paragraph 12, sell to persons desiring to become Limited
Partners. For each Unit of Limited Partnership Interest purchased prior to the
commencement of trading operations, a Limited Partner shall contribute $1,000 to
the capital of the Partnership. For any Unit (or partial unit rounded to four
decimal places) of Limited Partnership Interest purchased thereafter (except as
noted below with respect to the Special Limited Partner), a Limited Partner
shall contribute to the capital of the Partnership an amount equal to the Net
Asset Value of a Unit (or partial unit, as the case may be) of Limited
Partnership Interest as of the close of business on the day preceding the
effective date of such purchase, and shall pay in addition the
selling commission, if any, which must be paid with respect to such purchase.
The Special Limited Partner will contribute advisory services and will receive a
quarterly allocation in Units as described in Paragraph 8. The aggregate of all
contributions shall be available to the Partnership to carry on its business,
and no interest shall be paid on any such contribution. All subscriptions for
Units of Limited Partnership Interest made pursuant to the Private Placement of
the Units of Limited Partnership Interest must be on the form provided in the
Memorandum.
The proceeds from the sale of the Units of Limited Partnership Interest
pursuant to the Private Placement shall be placed in an escrow account and shall
not be contributed to the capital of the Partnership prior to the termination of
the initial offering period. If subscriptions for at least 10,000 Units of
Limited Partnership Interest shall not have been received and accepted by the
General Partner when the initial offering period is terminated, the full amount
of all subscriptions shall be returned promptly to the subscribers, and the
Certificate of Limited Partnership may, in the discretion of the General
Partner, be canceled. If subscriptions for at least 10,000 Units of Limited
Partnership Interest shall have been received and accepted by the General
Partner prior to the termination of the initial offering period, the proceeds
thereof shall be contributed to the capital of the Partnership and the
Partnership shall thereafter commence trading operations. All subscribers shall
receive the interest earned on their subscriptions while held in escrow. All
subscribers who have been accepted by the General Partner shall be deemed
admitted as Limited Partners at the time they are reflected as such in the books
and records of the Partnership.
7. Allocation of Profits and Losses.
(a) Capital Accounts. A capital account shall be established for each
Partner. The initial balance of each Partner's capital account shall be the
amount of his initial capital contribution to the Partnership. A Partner's
capital account shall be increased by the amount of any additional capital
contributions to the Partnership by such Partner, and shall be further adjusted
as provided in Paragraph 7(b).
(b) Allocations. As of the close of business on the last day of each month
during each fiscal year of the Partnership, and on such other dates as the
General Partner in its discretion shall determine (each, an "Allocation Date"),
the following determinations and allocations shall be made:
(1) The Net Assets of the Partnership (as defined in Paragraph
7(d)(1)), but before any advisory fees or profit share allocations as of such
date shall be determined.
(2) Monthly advisory fees, if any, payable by the Partnership as of
such date shall then be charged against Net Assets.
(3) Any increase or decrease in Net Assets of the Partnership from the
previous Allocation Date (or, with respect to the first calendar month of
operations, from the first day of operations) allocable to Limited Partners or
the General Partner, as the case may be, shall then be credited or charged to
the capital accounts of the Limited Partners or the General Partner, as the case
may be, in the ratio that the balance of each such Partner's capital account
bears to the balance of all such relevant Partners' capital accounts. For the
purpose of this Paragraph 7(b)(3), Net Assets shall be determined without regard
to (A) any Profit Share allocations to the
Special Limited Partner pursuant to Paragraph 7(b)(4), (B) distributions and
withdrawals described in Paragraph 7(b)(5), and (C) any contributions made to
the Partnership by a Partner during such month.
(4) As of each calendar quarter-end, the aggregate amount of net
increase in Net Assets allocated pursuant to Paragraph 7(b)(3) shall be adjusted
by charging the Partnership an amount equal to the Special Limited Partner's
Profit Share allocation payable as of such calendar quarter-end, pursuant to
Paragraph 8 and by crediting such amount to the Special Limited Partner's
capital account.
(5) The amount of any distribution to a Partner and any amount paid to
a Partner upon withdrawal of capital from the Partnership with respect to such
month shall be charged against the Partner's capital account. Upon liquidation
of the Partnership, the balance of the proceeds of liquidation after payment of
Partnership obligations shall be distributed to the Partners in proportion to
their remaining positive capital account balances after adjustment for prior
distributions and allocations.
(c) Allocations for Tax Purposes. All items of income, gains, losses,
deductions and credits of the Partnership for each fiscal year will be allocated
among the Partners for income tax purposes in a manner that reflects, as closely
as possible, the amounts and the components credited or debited to each
Partner's capital account pursuant to this Paragraph 7. Allocations pursuant to
this Paragraph 7(c) will not be credited or debited to capital accounts.
(d) Definitions.
(1) Net Assets. Net Assets of the Partnership shall mean the total
assets of the Partnership, including all cash, accrued interest and the market
value of all open commodity positions maintained by the Partnership less
brokerage charges accrued and less all other liabilities of the Partnership
determined in accordance with generally accepted accounting principles under the
accrual basis of accounting. The value of a commodity futures or option contract
is the unrealized gain or loss on the contract that is determined by marking it
to the current settlement price for a like contract acquired on the valuation
date. Physical commodities, options, forward contracts and futures contracts,
when no market quote is available, will be valued at their fair market value as
determined in good faith by the General Partner. U.S. Treasury securities and
other interest bearing obligations will be valued at cost plus accrued interest.
Interests in other commodity pools will be valued at their net asset value as
determined by the pool operator, or, if the General Partner has not received
such determination or believes that fairness so requires, at fair value
determined by the General Partner. Net Assets equals Net Asset Value.
(2) Net Asset Value per Unit. The Net Asset Value of each Unit of
Limited Partnership Interest and each Unit of General Partnership Interest shall
be determined by dividing the Net Assets of the Partnership by the aggregate
number of Units of Limited and General Partnership Interest outstanding.
(e) Expenses and Limitation Thereof. The Partnership's organizational
expenses and the expenses of the initial private offering of the Units of
Limited Partnership Interest described in Paragraph 11 hereof shall be initially
paid by Citigroup Global Markets Inc. (formerly known as
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.) ("CGM") and reimbursed as discussed in the
Memorandum. Subject to the limitations set forth below in this Paragraph 7(e),
the Partnership shall be obligated to pay all liabilities incurred by it,
including, without limitation, all expenses incurred in connection with its
trading activities, and any advisory or other expenses. The General Partner
shall bear all other operating expenses except legal, accounting, filing, data
processing and reporting fees and extraordinary expenses. Appropriate reserves
may be created, accrued and charged against Net Assets for contingent
liabilities, if any, as of the date any such contingent liability becomes known
to the General Partner.
(f) Limited Liability of Limited Partners.
(1) Each Unit of Limited Partnership Interest, when purchased by a
Limited Partner, subject to the qualifications set forth below, shall be fully
paid and non-assessable.
(2) A Limited Partner will have no liability in excess of his
obligation to make contributions to the capital of the Partnership and his share
of the Partnership's assets and undistributed profits, subject to the
qualifications provided in the Partnership Act.
(g) Return of Limited Partner's Capital Contribution. Except to the extent
that a Limited Partner shall have the right to withdraw capital through
redemption of Units of Limited Partnership Interest, no Limited Partner shall
have any right to demand the return of his capital contribution or any profits
added thereto, except upon dissolution and termination of the Partnership. In no
event shall a Limited Partner be entitled to demand and receive property other
than cash.
8. Profit Share Allocation to the Special Limited Partner.
The Special Limited Partner shall receive a quarterly profit share (a
"Profit Share") allocation to its capital account in the Partnership in the form
of additional Units and/or partial Units the value of which shall be equal to
20% of the New Trading Profits generated by the Special Limited Partner on
behalf of the Partnership as of each calendar quarter-end. The Profit Share
allocation shall be made to the Special Limited Partner within twenty (20)
business days following the end of the calendar quarter.
New Trading Profits with respect to a calendar quarter means the excess, if
any, of Net Assets managed by the Special Limited Partner at the end of the
calendar quarter over Net Assets managed by the Special Limited Partner at the
end of the highest previous calendar quarter or Net Assets allocated to the
Special Limited Partner at the date trading commences, whichever is higher, and
as further adjusted to eliminate the effect on Net Assets resulting from new
capital contributions, redemptions, reallocations or capital distributions, if
any, made during the calendar quarter decreased by interest or other income not
directly related to trading activity, earned on the Partnership's assets during
the calendar quarter whether the assets are held separately or in margin
accounts. Ongoing expenses will be attributed to the Special Limited Partner
based on the Special Limited Partner's proportionate share of Net Assets.
Ongoing expenses above will not include expenses of litigation not involving the
activities of the Special Limited Partner on behalf of the Partnership. Ongoing
expenses include offering and organizational expenses of the
Partnership. Interest income earned, if any, will not be taken into account in
computing New Trading Profits earned by the Special Limited Partner.
If any Profit Share allocation is made to the Special Limited Partner with
respect to New Trading Profits, and the Partnership thereafter incurs a net loss
for a subsequent period, the Special Limited Partner will retain the Profit
Share previously allocated in respect of New Trading Profits. If Net Assets
allocated to the Special Limited Partner are reduced due to net redemptions,
distributions or reallocations (net of additions), there will be a corresponding
proportional reduction in the related loss carryforward amount that must be
recouped before the Special Limited Partner is eligible to receive another
Profit Share. However, the Special Limited Partner would not be allocated any
Profit Share thereafter until all of such losses were recovered and the Special
Limited Partner achieved additional New Trading Profits.
If the Partnership is terminated or the Special Limited Partner is removed
as advisor of the Partnership on a date other than a calendar quarter-end, the
Profit Share allocation described above shall be determined and made as if such
date were a calendar quarter-end.
9. Management of the Partnership.
(a) General. The General Partner, to the exclusion of all Limited Partners,
shall conduct, control and manage the business of the Partnership, including,
without limitation, the investment of the funds of the Partnership. The General
Partner may, but is not obliged to, delegate its rights, duties and powers
hereunder, including but not limited to the duty to make trading decisions for
the Partnership. The General Partner has selected AAA Capital Advisors, Ltd. to
make trading decisions for the Partnership pursuant to an Advisory Agreement.
Except as provided herein, no Partner shall be entitled to any salary, draw or
other compensation from the Partnership. Each Limited Partner hereby undertakes
to advise the General Partner of such additional information as may be deemed by
the General Partner to be required or appropriate to open and maintain an
account or accounts with commodity brokerage firms for the purpose of trading in
commodity futures contracts.
Subject to Paragraph 5 hereof, the General Partner may engage in other
business activities and shall not be required to refrain from any other activity
nor disgorge any profits from any such activity, whether as general partner of
additional partnerships for investment in commodity futures contracts or
otherwise. The General Partner may engage and compensate on behalf of the
Partnership from funds of the Partnership, such persons, firms or corporations,
including any affiliated person or entity, as the General Partner in its sole
judgment shall deem advisable for the conduct and operation of the business of
the Partnership.
No person dealing with the General Partner shall be required to determine
its authority to make any undertaking on behalf of the Partnership, nor to
determine any fact or circumstance bearing upon the existence of its authority.
The General Partner shall monitor the trading and performance of any
trading advisor for the Partnership and shall not permit the "churning" of the
Partnership's account. The General Partner has been authorized to enter into the
Customer Agreement with CGM, and the Advisory Agreement with AAA Capital
Advisors, Ltd., each as described in the Memorandum and
to cause the Partnership to pay the fees and/or allocations described therein
and to negotiate Customer and Advisory Agreements in the future on those or
other terms. The General Partner may take such other actions as it deems
necessary or desirable to manage the business of the Partnership, including, but
not limited to, the following: opening bank accounts with state or national
banks; paying, or authorizing the payment of expenses of the Partnership, such
as advisory fees, legal and accounting fees, printing and reporting fees, and
registration and other fees of governmental agencies; and investing or directing
the investment of funds of the Partnership not being utilized as margin
deposits.
The General Partner shall maintain a list of the names and addresses of,
and interests owned by, all Partners, a copy of which shall be furnished to
Limited Partners upon request either in person or by mail and upon payment of
the cost of reproduction and mailing for a purpose reasonably related to such
Limited Partner's interest as a limited partner in the Partnership, and such
other books and records relating to the business of the Partnership as it deems
necessary or advisable at the principal office of the Partnership. The General
Partner shall retain such records for a period of not less than six years. The
Limited Partners, shall be given reasonable access to the books and records of
the Partnership for a purpose reasonably related to such Limited Partner's
interest as a limited partner in the Partnership.
The Partnership will pay the General Partner a monthly administrative fee
in return for its services to the Partnership. For the first year of trading
operations, the administrative fee will equal 1/12 of 1/2% (1/2% per year) of
month-end adjusted Net Assets of the Partnership. Thereafter, the fee may be
increased or decreased at the discretion of the General Partner. For purposes of
calculating the administrative fee, adjusted Net Assets are "Net Assets"
increased by the current month's profit share allocation accrual and any
redemptions or distributions as of the end of such month.
Except as provided herein and in the Memorandum, the Partnership shall not
enter into any contract with any of its affiliates or with any trading advisor
which has a term of more than one year. Except as provided herein and in the
Memorandum: (1) no person may receive, directly or indirectly, any advisory fee
for investment advice or management who shares or participates in commodity
brokerage commissions or fees from transactions for the Partnership; (2) no
broker may pay, directly or indirectly, rebates or give ups to any trading
advisor; and (3) such prohibitions shall not be circumvented by any reciprocal
business arrangements. On loans made available to the Partnership by the General
Partner or any of its affiliates, the lender may not receive interest in excess
of its interest costs, nor may the lender receive interest in excess of the
amounts which would be charged the Partnership (without reference to the
lender's financial abilities or guarantees) by unrelated banks on comparable
loans for the same purpose and the lender shall not receive points or other
financing charges or fees regardless of the amounts.
10. Audits and Reports to Limited Partners.
The Partnership books and records shall be audited annually by independent
accountants. The Partnership will cause each Partner to receive (i) within 90
days after the close of each fiscal year, audited financial statements,
including a balance sheet and statements of income and partners' equity for the
fiscal year then ended, and (ii) within 75 days after the close of each
fiscal year such tax information as is necessary for him to complete his federal
income tax return. In addition, within 30 days of the end of each month the
Partnership will provide each Limited Partner with reports showing Net Assets
and Net Asset Value per Unit of Limited and General Partnership Interest as of
the end of such month, as well as information relating to the fees and other
expenses incurred by the Partnership during such month. Both annual and monthly
reports shall include such additional information as the Commodity Futures
Trading Commission may require under the Commodity Exchange Act to be given to
participants in commodity pools such as the Partnership. The General Partner
shall calculate the Net Asset Value per Unit of Partnership Interest daily and
shall make such information available upon the request of a Limited Partner for
a purpose reasonably related to such Limited Partner's interest as a Limited
Partner in the Partnership.
In addition, if any of the following events occur, notice of such event
shall be mailed to each Limited Partner within seven business days of the
occurrence of the event: (i) a decrease in the Net Asset Value of a Unit of
Limited Partnership Interest to $400 or less as of the end of any trading day;
(ii) any change in trading advisor(s); (iii) any change in the General Partner;
(iv) any change in commodity broker(s); or (v) any material change in the
Partnership's trading policies or in an advisor's trading strategies.
11. Transfer and Redemption of Units.
(a) Initial Limited Partner. As of the day after trading commences, the
Initial Limited Partner may redeem his Unit for $1,000 and withdraw from the
Partnership.
(b) Transfer. Each Limited Partner expressly agrees that he will not
assign, transfer or dispose of, by gift or otherwise, any of his Units of
Limited Partnership Interest or any part or all of his right, title and interest
in the capital or profits of the Partnership without the consent of the General
Partner except (i) in the case of an individual Limited Partner, disposition of
Units by last will and testament or by virtue of the laws of descent and
distribution and (ii) in the case of a Limited Partner that is not an
individual, disposition of Units upon liquidation, dissolution or other
termination of the entity that is a Limited Partner. No transfer or assignment
shall be permitted unless the General Partner is satisfied that (i) such
transfer or assignment would not violate the Securities Act of 1933 or any state
securities law and (ii) notwithstanding such transfer or assignment, the
Partnership will continue to be classified as a Partnership under the Internal
Revenue Code. No assignment, transfer or disposition permitted by this Agreement
shall be effective against the Partnership or the General Partner until the
first day of the quarter next succeeding the quarter in which the General
Partner gives its consent, except as otherwise provided in this sub-paragraph
11(b). Any assignment, transfer or disposition by an assignee of Units of
Limited Partnership Interest of his interest in the capital or profits of the
Partnership shall not be effective against the Partnership or the General
Partner until the first day of the quarter next succeeding the quarter in which
the General Partner gives its consent. If an assignment, transfer or disposition
occurs by reason of the death or by termination of a Limited Partner or
assignee, written notice must be given to the General Partner by the duly
authorized representative of the estate of the Limited Partner or assignee and
shall be supported by such proof of legal authority and valid assignment as may
reasonably be requested by the General Partner. Any such assignee shall become a
substituted Limited Partner only upon the consent of the General Partner (which
consent may be withheld at its sole and absolute discretion), upon the execution
of a Power of Attorney by
such assignee appointing the General Partner as his attorney-in-fact in the form
contained in Paragraph 14 hereof. The estate or any beneficiary of a deceased
Limited Partner or assignee shall have no right to withdraw any capital or
profits from the Partnership except by redemption of Units of Limited
Partnership Interest. A substituted Limited Partner shall have all the rights
and powers and shall be subject to all the restrictions and liabilities of a
limited partner of the Partnership. A substituted Limited Partner is also liable
for the obligations of his assignor to make contributions to the Partnership,
but shall not be liable for the obligations of his assignor under the
Partnership Act to return distributions received by the assignor; provided,
however, that a substituted Limited Partner shall not be obligated for
liabilities unknown to him at the time he became a substituted Limited Partner
and which could not be ascertained from this Agreement. Each Limited Partner
agrees that with the consent of the General Partner any assignee may become a
substituted Limited Partner without the approval of any Limited Partner. If the
General Partner withholds consent, an assignee shall not become a substituted
Limited Partner and shall not have any of the rights of a Limited Partner except
that the assignee shall be entitled to receive that share of capital or profits
and shall have that right of redemption to which his assignor would otherwise
have been entitled. An assigning Limited Partner shall remain liable to the
Partnership as provided in the Partnership Act, regardless of whether his
assignee becomes a substituted Limited Partner. The transfer of Units of Limited
Partnership Interest shall be subject to all applicable securities laws. The
transferor or assignor shall bear the cost related to such transfer or
assignment. Certificates representing Units of Limited Partnership Interest may
bear appropriate legends to the foregoing effect.
(c) Redemption. Provided such Units have been held for three (3) full
months, a Limited Partner (or any assignee thereof) may withdraw all or part of
his capital contribution and undistributed profits, if any, from the Partnership
in multiples of the Net Asset Value of a Unit of Limited Partnership Interest
(such withdrawal being herein referred to as "redemption") as of the last day of
a month (the "Redemption Date") after a request for redemption has been made to
the General Partner; provided that all liabilities, contingent or otherwise, of
the Partnership, except any liability to Partners on account of their capital
contributions, have been paid or there remains property of the Partnership
sufficient to pay them. As used herein, "request for redemption" shall mean a
written or oral request in a form specified by the General Partner and received
by the General Partner at least ten days in advance of the Redemption Date. The
General Partner, in its discretion, may waive the ten day notice requirement. A
form of Request for Redemption is included in the Memorandum referred to in
Paragraph 12. Additional forms of Request for Redemption may be obtained by
written request to the General Partner. Redemption of partial Units will be
permitted at the General Partner's discretion. Upon redemption, a Limited
Partner (or any assignee thereof) shall receive, per Unit of Limited Partnership
Interest redeemed, an amount equal to the Net Asset Value of a Unit of Limited
Partnership Interest as of the Redemption Date, less any amount owing by such
Partner (and his assignee, if any) to the Partnership. If redemption is
requested by an assignee, all amounts owed by the Partner to whom such Unit of
Limited Partnership Interest was sold by the Partnership as well as all amounts
owed by all assignees of such Unit of Limited Partnership Interest shall be
deducted from the Net Asset Value of such Unit of Limited Partnership Interest
upon redemption by any assignee. Payment will be made within 10 business days
after the Redemption Date. The General Partner may temporarily suspend
redemptions if necessary in order to liquidate commodity positions in an orderly
manner and may permit less frequent redemptions if it has received an opinion
from counsel that such action is
advisable to prevent the Partnership from being considered a publicly traded
partnership by the Internal Revenue Service.
The General Partner may, at its sole discretion and upon notice to the
Limited Partners, declare a special Redemption Date on which date Limited
Partners may redeem their Units at Net Asset Value per Unit, provided that the
Limited Partners submit requests for redemption in a form acceptable to the
General Partner.
The General Partner may require that any Limited Partner redeem his Units
on 10 days' notice to the Limited Partner if, in the sole discretion of the
General Partner, it is in the best interests of the Partnership to require such
redemption.
12. Private Placement of Units of Limited Partnership Interest.
The General Partner on behalf of the Partnership shall (i) cause to be
filed a Private Placement Offering Memorandum and Disclosure Document, and such
amendments thereto as the General Partner deems advisable, with the United
States Commodity Futures Trading Commission for private placement of the Units
of Limited Partnership Interest, and (ii) qualify the Units of Limited
Partnership Interest for sale under the securities laws of such States of the
United States as the General Partner shall deem advisable. The General Partner
may make such other arrangements for the sale of the Units of Limited
Partnership Interest as it deems appropriate including, without limitation, the
execution on behalf of the Partnership of an agency agreement with CGM as an
agent of the Partnership for the offer and sale of the Units as contemplated in
the Memorandum.
13. Admission of Additional Partners.
After the Private Placement of the Units of Limited Partnership Interest
has been terminated by the General Partner, no additional General Partner will
be admitted to the Partnership except as described in Paragraph 18(c). The
General Partner may take such actions as may be necessary or appropriate at any
time to offer new Units or partial Units and to admit new or substituted Limited
Partners to the Partnership. All subscribers who have been accepted by the
General Partner shall be deemed admitted as Limited Partners at the time they
are reflected as such in the books and records of the Partnership.
14. Special Power of Attorney.
Each Limited Partner does irrevocably constitute and appoint the General
Partner, and each other person or entity that shall after the date of this
Agreement become a general partner of the Partnership, with the power of
substitution, as his true and lawful attorney-in-fact, in his name, place and
▇▇▇▇▇, to execute, acknowledge, swear to, file and record in his behalf in the
appropriate public offices and publish (i) this Agreement and a Certificate of
Limited Partnership, including amendments and/or restatements thereto; (ii) all
instruments which the General Partner deems necessary or appropriate to reflect
any amendment, change or modification of the Partnership in accordance with the
terms of this Agreement, including any instruments necessary to dissolve the
Partnership; (iii) Certificates of Assumed Name; and (iv) Customer Agreements
with CGM or other commodity brokerage firms. The Power of Attorney granted
herein shall be irrevocable and deemed to be a power coupled with an interest
and shall survive and not be affected by the
subsequent incapacity, disability or death of a Limited Partner. Each Limited
Partner hereby agrees to be bound by any representation made by the General
Partner and by any successor thereto, acting in good faith pursuant to such
Power of Attorney and each Limited Partner hereby waives any and all defenses
which may be available to contest, negate or disaffirm the action of the General
Partner and any successor thereto, taken in good faith under such Power of
Attorney. In the event of any conflict between this Agreement and any
instruments filed by such attorney pursuant to the Power of Attorney granted in
this Paragraph, this Agreement shall control.
15. Withdrawal of a Partner.
The Partnership shall be dissolved and its affairs wound up upon the
assignment by the General Partner of all of its interest in the Partnership,
withdrawal, removal, bankruptcy, or any other event that causes the General
Partner to cease to be a general partner under the Partnership Act (unless the
Partnership is continued pursuant to Paragraph 18). The General Partner shall
not withdraw from the Partnership without giving the Limited Partners ninety
(90) days' prior written notice. The death, incompetency, withdrawal, insolvency
or dissolution of a Limited Partner shall not (in and of itself) dissolve the
Partnership, and such Limited Partner, his estate, custodian or personal
representative shall have no right to withdraw or value such Limited Partner's
interest in the Partnership except as provided in Paragraph 11 hereof. Each
Limited Partner (and any assignee of such Partner's interest) expressly agrees
that, in the event of his death, he waives on behalf of himself and his estate,
and he directs the legal representative of his estate and any person interested
therein to waive, the furnishing of any inventory, accounting, or appraisal of
the assets of the Partnership and any right to an audit or examination of the
books of the Partnership; provided, however, that this waiver in no way limits
the rights of the Limited Partners or their representatives to have access to
the Partnership's books and records as described in Paragraph 9 hereof.
16. No Personal Liability for Return of Capital.
The General Partner, subject to Paragraph 17 hereof, shall not be
personally liable for the return or repayment of all or any portion of the
capital or profits of any Partner (or assignee), it being expressly agreed that
any such return of capital or profits made pursuant to this Agreement shall be
made solely from the assets (which shall not include any right of contribution
from the General Partner) of the Partnership.
17. Indemnification.
(a) The General Partner and its Affiliates shall have no liability to the
Partnership or to any Partner for any loss suffered by the Partnership which
arises out of any action or inaction of the General Partner or its Affiliates if
the General Partner or its Affiliates in good faith determined that such course
of conduct was in the best interest of the Partnership and such course of
conduct did not constitute negligence or misconduct of the General Partner or
its Affiliates. To the fullest extent permitted by law, the General Partner and
its Affiliates shall be indemnified by the Partnership against any losses,
judgments, liabilities, expenses and amounts paid in settlement of any claims
sustained by them in connection with the Partnership, provided that the same
were not the result of negligence or misconduct on the part of the General
Partner or its Affiliates.
(b) Notwithstanding (a) above, the General Partner and its Affiliates shall
not be indemnified for any losses, liabilities or expenses arising from or out
of an alleged violation of federal or state securities laws in connection with
the offer or sale of Units.
(c) The Partnership shall not incur the cost of that portion of any
insurance which insures any party against any liability the indemnification of
which is herein prohibited.
(d) For purposes of this Paragraph 16, the term "Affiliates" shall mean any
person performing services on behalf of the Partnership and acting within the
scope of the General Partner's authority as set forth in this Agreement who: (1)
directly or indirectly controls, is controlled by, or is under common control
with the General Partner; or (2) owns or controls 10% or more of the outstanding
voting securities of the General Partner; or (3) is an officer or director of
the General Partner.
(e) The provision of advances from Partnership funds to the General Partner
and its Affiliates for legal expenses and other costs incurred as a result of
any legal action initiated against the General Partner by a Limited Partner of
the Partnership is prohibited.
(f) Any indemnification under subparagraph (a) above, unless ordered by a
court, shall be made by the Partnership only as authorized in the specific case
and only upon a determination by independent legal counsel in a written opinion
that indemnification of the General Partner or its Affiliates is proper in the
circumstances because it has met the applicable standard of conduct set forth in
subparagraph (a) above.
18. Amendments; Meetings.
(a) Amendments with Consent of the General Partner. If at any time during
the term of the Partnership the General Partner shall deem it necessary or
desirable to amend this Agreement (including the Partnership's basic investment
policies set forth in paragraph 3(b) hereof), such amendment shall be effective
only if approved in writing by the General Partner and, except as specified in
this sub-section (a), by Limited Partners owning more than 50% of the Units of
Limited Partnership Interest then outstanding and if made in accordance with the
Partnership Act. Any such supplemental or amendatory agreement shall be adhered
to and have the same effect from and after its effective date as if the same had
originally been embodied in and formed a part of this Agreement.
The General Partner may amend this Limited Partnership Agreement without
the consent of the Limited Partners in order (i) to clarify any clerical
inaccuracy or ambiguity or reconcile any inconsistency (including any
inconsistency between this Limited Partnership Agreement and the Memorandum);
(ii) to delete or add any provision of or to the Limited Partnership Agreement
required to be deleted or added by the staff of any federal or state agency; or
(iii) to make any amendment to the Limited Partnership Agreement which the
General Partner deems advisable (including but not limited to amendments
necessary to effect the allocations proposed herein) provided that such
amendment is not adverse to the Limited Partners, or is required by law.
The General Partner may, however, change the trading policies in paragraph
3(b) of this Agreement without the approval of the Limited Partners when such
change is deemed to be in the best interests of the Partnership. In addition, if
the General Partner determines to offer Units to the public in the future, the
General Partner may amend this Agreement as necessary to effect such public
offering without obtaining the consent of the Limited Partners, provided,
however, that such amendments are deemed to be in the best interests of the
Limited Partners. Amendments that are consistent with the North American
Securities Administrators Association's Guidelines for the Registration of
Commodity Pools will be presumed to be in the best interests of the Limited
Partners.
(b) Meetings. Upon receipt of a written request, signed by Limited Partners
owning at least 10% of the Units of Limited Partnership Interest then
outstanding, that a meeting of the Partnership be called to vote upon any matter
which the Limited Partners may vote upon pursuant to this Agreement, the General
Partner shall, by written notice to each Limited Partner of record mailed within
fifteen (15) days after receipt of such request, call a meeting of the
Partnership. Such meeting shall be held at least thirty (30) but not more than
sixty (60) days after the mailing of such notice, and such notice shall specify
the date, a reasonable place and time, and the purpose of such meeting.
(c) Amendments and Actions without Consent of the General Partner. At any
meeting called pursuant to Paragraph 18(b), upon the approval by an affirmative
vote (which may be in person or by proxy) of Limited Partners owning more than
50% of the outstanding Units of Limited Partnership Interest, the following
actions may be taken: (i) this Agreement may be amended in accordance with and
only to the extent permissible under the Partnership Act; (ii) the Partnership
may be dissolved; (iii) the General Partner may be removed and a new general
partner may be admitted immediately prior to the removal of the General Partner
provided that the new general partner of the Partnership shall continue the
business of the Partnership without dissolution; (iv) if the General Partner
elects to withdraw from the Partnership, a new general partner or general
partners may be admitted immediately prior to the withdrawal of the General
Partner provided that the new general partner of the Partnership shall continue
the business of the Partnership without dissolution; (v) any contracts with the
General Partner, any of its Affiliates or any commodity trading advisor to the
Partnership may be terminated on sixty days' notice without penalty; and (vi)
the sale of all of the assets of the Partnership may be approved; provided,
however, that no such action may be taken unless the Partnership has been
furnished with an opinion of counsel that the action to be taken will not
adversely affect the liability of the Limited Partners and that the action is
permitted by the Partnership Act.
(d) Continuation. Upon the assignment by the General Partner of all of its
interest in the Partnership, the withdrawal, removal, bankruptcy or any other
event that causes the General Partner to cease to be a general partner under the
Partnership Act, the Partnership is not dissolved and is not required to be
wound up by reason of such event if, (i) there is a remaining general partner
who continues the business of the Partnership or (ii) within ninety (90) days
after such event, all remaining Partners agree in writing to continue the
business of the Partnership and to the appointment, effective as of the date of
such event, of a successor General Partner.
19. Governing Law.
The validity and construction of this Agreement shall be determined and
governed by the laws of the State of New York.
20. Miscellaneous.
(a) Priority among Limited Partners. With the exception of the Profit Share
allocation to the Special Limited Partner, no Limited Partner shall be entitled
to any priority or preference over any other Limited Partner with regard to the
return of contributions of capital or to the distribution of any profits or
otherwise in the affairs of the Partnership.
(b) Notices. All notices under this Agreement, other than reports by the
General Partner to the Limited Partners, shall be in writing and shall be
effective upon personal delivery, or, if sent by registered or certified mail,
postage prepaid, addressed to the last known address of the party to whom such
notice is to be given, upon the deposit of such notice in the United States
mail. Reports by the General Partner to the Limited Partners shall be in writing
and shall be sent by first class mail to the last known address of each Limited
Partner.
(c) Binding Effect. This Agreement shall inure to and be binding upon all
of the parties, their successors, permitted assigns, custodians, estates, heirs
and personal representatives. For purposes of determining the rights of any
Partner or assignee hereunder, the Partnership and the General Partner may rely
upon the Partnership records as to who are Partners and assignees and all
Partners and assignees agree that their rights shall be determined and that they
shall be bound thereby, including all rights which they may have under Paragraph
17 hereof.
(d) Captions. Captions in no way define, limit, extend or describe the
scope of this Agreement nor the effect of any of its provisions.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day first mentioned above.
General Partner: Initial Limited Partner:
Citigroup Managed Futures LLC
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇
President and Director
Special Limited Partner:
AAA Capital Management Advisors, Ltd.
By: /s/ A. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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A. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
President
Limited Partners:
All Limited Partners now and hereafter admitted as limited partners of the
Partnership pursuant to powers of attorney now and hereafter executed in favor
of and delivered to the General Partner.
By: CITIGROUP MANAGED FUTURES LLC
ATTORNEY-IN-FACT
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇
President and Director