Consensus One Venture Capital Limited Partnership Deed


8. MANAGEMENT OF THE PARTNERSHIP

8.1 Reinvestment 
8.2 No limitation of the General Partner 
8.3 Powers of the General Partner 
8.4 Limitations on powers of the General Partner 
8.5 Competition 
8.6 Authorised activities of the General Partner 
8.7 General obligations of the General Partner 
8.8 Power of the General Partner to bind the Partnership 
8.9 Appointments by the General Partner 
8.10 Limited Partners must comply with directions of Appointees 
8.11 Notification obligation of the General Partner 
8.12 Powers and obligations of Limited Partners 
8.13 Disclosures 
8.14 Advisory Committee 
8.15 Firm-Name, Firm-Mark and other intellectual property rights 
8.16 Amendment of this deed

8.1 Reinvestment

The General Partner must not apply proceeds of an Investment to make an investment of the Partnership other than:

(a) the application of proceeds of:

(i) a Liquidity Investment; or

(ii) a realisation in cash or other immediately available funds of an Investment made within 12 months before the realisation;

(b) to make:

(i) a Liquidity Investment; or

(ii) an Investment Swap; or

(c) as approved by the Advisory Committee or by Special Majority Resolution.

8.2 No limitation of the General Partner

Nothing in this deed limits:

(a) the General Partner being a limited partnership;

(b) a general partner of the General Partner:

(i) acting on behalf of and binding the General Partner; and

(ii) exercising all powers, enforcing all rights and, except where the law or a provision of this deed contemplates performance by each partner of the General Partner, performing all obligations of the General Partner under this deed and in respect of the Partnership;

(c) any act for the purposes of this deed of a general partner of the General Partner being an act of the General Partner;

(d) any amount payable under this deed to the General Partner being paid to the general partner of the General Partner;

(e) any amount payable under this deed by the General Partner being paid by the general partner of the General Partner;

(f) any change of any limited partner of the General Partner; or

(g) the General Partner or any general partner or limited partner of the General Partner making or allowing to be made:

(i) a Disposal in respect of or holding on trust all or any of the Carried Interest on trust or any change in any beneficial interest in any trust on which all or any of the Carried Interest is held; or

(ii) a Security Interest over all or any of the Partnership Interest of the General Partner.

8.3 Powers of the General Partner

Subject to clauses 8.4 (Limitations on powers of the General Partner), 8.5 (Competition), 8.9 (Appointments by the General Partner) and the other provisions of this deed, the General Partner has the exclusive power to manage and control the Partnership, the Investments and the business of the Partnership, including:

(a) to exercise the rights and perform the obligations of the General Partner under this deed;

(b) to formulate, implement and change the investment plan and activities of the Partnership;

(c) to incur Outgoings on behalf of the Partnership and pay Outgoings of the Partnership out of the assets of the Partnership;

(d) to act as the General Partner considers to be necessary or desirable in connection with the conduct of the business of the Partnership;

(e) to receive, buy, hold, sell, exchange, trade, effect, assign, dispose of and otherwise deal in and with Securities, Liquidity Investments and other assets, rights or property on behalf of the Partnership;

(f) to open, conduct and close accounts with brokers and finders on behalf of the Partnership and pay fees and charges applicable to transactions in those accounts;

(g) to open, maintain and close bank accounts and custodial accounts of the Partnership and draw cheques and other orders for the payment of money by or on behalf of the Partnership;

(h) to prepare and lodge, on behalf of the Partnership, any tax returns or other documents relating to the Partnership;

(i) to commence or defend litigation that relates to the Partnership or an Investment, to prosecute, settle or compromise claims by the Partnership, to settle or compromise claims against the Partnership and to execute documents and make representations, admissions and waivers which the General Partner considers to be necessary or advisable in connection with any of those things;

(j) in the ordinary course of business of the Partnership, to cause the Partnership to borrow money, obtain other financial accommodation, guarantee obligations of others or incur lease obligations;

(k) in the ordinary course of business of the Partnership, to create a Security Interest over Investments;

(l) to enter into, make, give, amend, waive and perform on behalf of the Partnership, agreements, arrangements, understandings, representations, warranties, indemnities and obligations, and to do any other acts the General Partner considers to be necessary or desirable for, or that are incidental to, the conduct of the business of the Partnership;

(m) to purchase on behalf of or for a benefit to the Partnership, and pay on behalf of the Partnership for, liability and other insurance and to take any action on behalf of the Partnership, including the purchase of put options and other derivatives, that the General Partner considers to be necessary or desirable to protect the Partnership, including to protect an Investment or the business of the Partnership;

(n) to enter into contracts for the underwriting or sub-underwriting of an issue, purchase or sale of Securities;

(o) to invest in, or enter into, hedging arrangements on behalf of the Partnership designed to reduce or eliminate the risk of changes in the value of any Investments;

(p) to assume, exercise, fulfil and perform the rights, powers and obligations which a general partner may have under the laws of the state specified in clause 21 of schedule A;

(q) to perform any other act which the General Partner considers to be necessary or desirable in relation to the Partnership, the Investments or the business of the Partnership;

(r) to fetter any discretion of the General Partner or the Partnership;

(s) to do anything incidental to any other power of the General Partner under this deed; and
(t) to do in the name of the Partnership, anything which the General Partner has the power to do on behalf of the Partnership.

8.4 Limitations on powers of the General Partner

(a) The General Partner may not:

(i) borrow money, obtain other financial accommodation or guarantee obligations of others on behalf of the Partnership except if:

A. the total amount of the borrowings and other financial accommodation of and the amounts guaranteed by the Partnership does not at the time of the financial accommodation or guarantee exceed the amount specified in clause 18 of schedule A; and

B. any borrowing by the Partnership does not result in a Limited Partner being in breach of section 67 of the Superannuation Industry (Supervision) Act if a Deed of Accession executed by the Limited Partner and delivered to and accepted by General Partner under this deed specifies that section 67 of the Superannuation Industry (Supervision) Act applies to the Limited Partner;

(ii) create a Security Interest over an Investment which would result in a Limited Partner being in breach of regulation 13.14 of the Superannuation Industry (Supervision) Regulations if a Deed of Accession executed by the Limited Partner and delivered to and accepted by General Partner under this deed specifies that regulation 13.14 of the Superannuation Industry (Supervision) Regulations applies to the Limited Partner;

(iii) use or otherwise deal with an Investment for an improper purpose; or

(iv) except as provided in clauses 8.2(f), 9.7 (Voluntary retirement of the General Partner), 9.8 (Obligatory retirement of the General Partner) and 9.9 (Interim, successor and liquidating General Partners), admit a person as the General Partner.

(b) Without approval by Special Majority Resolution, the General Partner may not:

(i) engage in any activity on behalf of the Partnership other than as the General Partner considers to be necessary or desirable to conduct the business of the Partnership; or

(ii) engage in any matter contrary to schedule F or G.

(c) Without approval by the Advisory Committee or by Special Majority Resolution, the General Partner may not:

(i) except as permitted under sub-paragraph (ii) or clause 8.6 (Authorised activities of the General Partner), approve any transaction of the Partnership in which there is an actual or potential conflict between the interests of the General Partner[ or any of its Associates] and the interests of the Partnership; or

(ii) either:

A. sell an asset, right or other property to, or purchase an Investment from, the Partnership; or

B. sell on behalf of the Partnership an Investment to, or purchase on behalf of the Partnership, an asset, right or other property from, an Affiliate of the General Partner, 

unless the terms of the purchase or sale:

C. would be reasonable in the circumstances if the parties to the purchase or sale were dealing at arm’s length; or

D. are more favourable to the Partnership than to the other party to the purchase or sale.

8.5 Competition

Except by Special Majority Resolution or as disclosed to each Limited Partner before the Limited Partner first executed a Deed of Accession which was delivered to and accepted by the General Partner under this deed, neither the General Partner nor any of its Affiliates may promote or establish a partnership, trust or similar investment structure with investment objectives and strategies substantially similar to those of the Partnership, until the date specified in clause 19 of schedule A.

8.6 Authorised activities of the General Partner

(a) The General Partner may co-invest or otherwise participate in investment opportunities of the Partnership and may offer the right to co-invest or otherwise participate in investment opportunities of the Partnership to any person, including a Limited Partner, a partner, member, employee, agent, adviser or Associate of the General Partner or of a Limited Partner, or a private investor, group, partnership, trust or company or other entity, except that a co-investment with the Partnership by the General Partner[ or any of its Associates] may only be made:

(i) if the terms of the co-investment have been outlined to the Advisory Committee or the Limited Partners; and

(ii) with approval by the Advisory Committee or by Special Majority Resolution, if the terms of the co-investment are more favourable to the General Partner[ or its Associate (as relevant)] than the terms of the co-investment by the Partnership.

(b) None of the General Partner, an Appointee or an Associate of any of them is required to first present to the Partnership an investment opportunity of the Partnership.

(c) The General Partner may manage an investment by any other person in an entity in which the Partnership has an investment.

(d) The General Partner is not liable to the Partnership in respect of any exercise by the General Partner of any rights under paragraph (a), (b) or (c).

(e) Any director fees, consulting fees, other fees, or Securities earned or received by the General Partner, an Appointee or any of their respective Associates, partners, members, employees or agents for services provided to an entity in which the Partnership has invested are not the property of the Partnership, and the Partnership has no right, title or interest in or to those fees or Securities.

8.7 General obligations of the General Partner

The General Partner must, in connection with the Partnership, the Investments and the business of the Partnership:

(a) manage and control the Partnership in accordance with this deed;

(b) act honestly;

(c) except as permitted under this deed, act in the best interests of the Partnership;

(d) except as permitted under this deed, give priority to the interests of the Partnership to the extent of any conflict between the interests of the General Partner and the interests of the Partnership;

(e) exercise due care and skill in performing the obligations of the General Partner under this deed and otherwise in relation to the Partnership;

(f) apply reasonable business judgment in determining when an investment opportunity meets the investment criteria of the Partnership and whether it is in the best interests of the Partnership to take advantage of the investment opportunity;

(g) ensure that the Investments are:

(i) able to be identified as property of the Partnership; and

(ii) held separately from the property of the General Partner and any property of any other partnership, trust or company or other entity; and

(h) promptly inform the Limited Partners of any event or circumstance which has had, or is likely to have, a materially adverse effect on the interests of the Partnership.

8.8 Power of the General Partner to bind the Partnership

Subject to clause 9.9 (Interim, successor and liquidating General Partners) but despite any other provision of this deed, any contract, agreement, deed, lease, note or other document or instrument executed by the General Partner on behalf of the Partnership, with or without the signature of any other Partner, is deemed to have been duly executed by the Partnership and binds the Partnership.

8.9 Appointments by the General Partner

This deed allows the appointment by the General Partner of an Appointee, including to exercise some or all of the powers of the General Partner or the Partnership. However, the General Partner may not delegate its overall powers to manage the Partnership without Special Majority Resolution. Although the Appointee is not a party to this deed, the Limited Partners agree, under clause 8.10 to act in accordance with directions of the Appointee in relation to those powers of the General Partner delegated to the Appointee.

(a) Subject to paragraph (b), the General Partner may from time to time appoint a person to:

(i) exercise some or all of the rights and powers of the General Partner under this deed;

(ii) perform some or all of the obligations of the General Partner under this deed; or

(iii) provide advice or services to:

A. the Partnership; or

B. the General Partner in its capacity as General Partner.

(b) The General Partner may not delegate its overall powers to manage the Partnership without a Special Majority Resolution.

(c) The General Partner must:

(i) exercise due care and skill in selecting and appointing an Appointee; and

(ii) review and monitor the performance of each Appointee.

8.10 Limited Partners must comply with directions of Appointees

If the General Partner gives notice to a Limited Partner that the General Partner has appointed an Appointee in accordance with clause 8.9(a) to exercise rights or powers or perform obligations of the General Partner under this deed as specified in the notice, the Limited Partner must:

(a) perform for the Appointee as if the Appointee were the General Partner under this deed, the obligations of the Limited Partner in respect of those rights, powers or obligations; and

(b) comply with any reasonable directions by the Appointee in respect of, or in connection with, those rights, powers or obligations.

8.11 Notification obligation of the General Partner

The General Partner must as soon as practicable give notice to each Limited Partner of:

(a) an Insolvency Event in respect of the General Partner; or

(b) a Key Personnel Change in respect of the General Partner.

8.12 Powers and obligations of Limited Partners

(a) No Limited Partner or employee, officer or agent of a Limited Partner (in its capacity as an employee, officer or agent of the Limited Partner) may take part in the management of the business of the Partnership (within the meaning of the term “take part in the management of the business” in the Partnership Act) except in relation to those acts which the Partnership Act permits a limited partner to perform without being deemed to so take part in the management of the business of the Partnership.

(b) Subject to clause 8.8 (Power of the General Partner to bind the Partnership), none of the General Partner, any Appointee or any other person appointed by the General Partner or an Appointee in accordance with this deed, is the agent of a Limited Partner in respect of or in relation to the management of the business of the Partnership, including in respect of or in relation to:

(i) any decision, discussion, negotiation or representation in connection with an existing or proposed Investment or investment opportunity of the Partnership;

(ii) any decision, discussion, negotiation or representation in connection with a Limited Partner or any other person to whom the Partnership or an interest in the Partnership has been offered or promoted; or

(iii) any conduct of the business of the Partnership, including:

A. any preparation of Disclosure Documents, Product Disclosure Statements, promotional material, catalogues, display stands, signs, films, plates, television or print media material or material of a similar nature used in the business of the Partnership; and

B. a determination of Partnership Profit, Partnership Losses, or their allocation under this deed.

(c) Except as otherwise provided in this deed or required by the Partnership Act, no Limited Partner has any right or power:

(i) to act on behalf of the Partnership in any matter;

(ii) to enter into any agreement or arrangement for or on behalf of the Partnership;

(iii) to bind any other Partner or the Partnership;

(iv) to dissolve the Partnership, by notice or otherwise; or

(v) to direct the General Partner in respect of any matter, including any right or power of the General Partner:

A. under this deed; or 

B. in respect of an Investment.

(d) No Limited Partner may hold itself, or any other Limited Partner, out as acting on behalf of the Partnership.

(e) Each Partnership Interest of a Partner is a chose in action and no Limited Partner may require any Investment to be transferred to the Limited Partner or any other person except as otherwise provided in this deed.

8.13 Disclosures

The General Partner may give to a Government Agency any information in relation to the Partnership or a Partner which the General Partner reasonably considers to be necessary or desirable.

8.14 Advisory Committee

Schedule D sets out provisions in relation to the appointment, functions, meetings, decisions and expense reimbursement of any Advisory Committee.

8.15 Firm-Name, Firm-Mark and other intellectual property rights

Despite any provision of this deed to the contrary:

(a) the Firm-Name, Firm-Marks, any portion of the Firm-Name or Firm-Marks, any associated Uniform Resource Locator (URL) and any other intellectual property rights associated with the Firm-Name, Firm-Marks or URL are the property of the General Partner or any of its Affiliates;

(b) the General Partner or any of its Affiliates may use the Firm-Name or any portion of it for any transaction and in any manner without any fee, royalty or other compensation to the Partnership or the Partners;

(c) the power of the Partnership to use the Firm-Name, Firm-Marks and URL may be withdrawn by the General Partner or any of its Affiliates at any time without compensation to the Partnership;

(d) no Partner other than the General Partner has any right, title or interest in or to the Firm-Name, Firm-Marks or URL; and

(e) on completion of the dissolution and winding up of the Partnership, all right, title and interest in and to the Firm-Name, Firm-Marks and URL is held solely by the General Partner or any of its Affiliates.

8.16 Amendment of this deed

(a) Subject to paragraph (c), this deed may be modified, or repealed and replaced, by a deed executed by the General Partner if:

(i) approved by Special Majority Resolution; or

(ii) the General Partner reasonably considers that the change will not adversely affect the rights of any Limited Partner.

(b) For the avoidance of doubt, the Limited Partners may not modify, or repeal and replace, this deed.

(c) If a proposed modification, or repeal and replacement, of this deed may adversely affect the rights of a former General Partner, the prior written approval of the former General Partner must be obtained before the modification, or repeal or replacement, may take effect.

(d) The General Partner must give prompt notice to each Limited Partner of each modification, or repeal and replacement, of this deed.

(e) This deed is modified, or repealed and replaced, on the later of the satisfaction of the requirements for the modification, repeal or replacement, under paragraph (a) and the time which that modification, repeal or replacement, is to take effect. 

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