<PAGE>
Exhibit 3.1
THE JONES FINANCIAL COMPANIES, L.L.L.P.
FOURTEENTH
AMENDED AND RESTATED
AGREEMENT OF REGISTERED
LIMITED LIABILITY LIMITED PARTNERSHIP
Dated as of January 1, 2004
<PAGE>
TABLE OF CONTENTS
ARTICLE ONE DEFINED
TERMS.....................................................3
ARTICLE TWO CONTINUATION, NAME AND OFFICE,
PURPOSES, TERM AND DISSOLUTION,
--------------------------------------------------------------
REGISTERED AGENT, PARTNER
LIST.......................................8
------------------------------
2.1
Continuation................................................8
------------
2.2 Name,
Place of Business and Office..........................8
----------------------------------
2.3
Purposes....................................................8
--------
2.4 Term and
Dissolution........................................8
--------------------
2.5 Registered
Office and Agent.................................8
---------------------------
2.6 Amendment
to Certificate of Limited Partnership.............9
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ARTICLE THREE PARTNERS AND
CAPITAL............................................9
--------------------
3.1 General
Partners............................................9
----------------
3.2 Admission
of Additional General Partners....................9
----------------------------------------
3.3 Limiteds
and Contained Payments to Limited Partners.........9
---------------------------------------------------
3.4 Admission
of Limiteds......................................10
---------------------
3.5
Partnership Capital........................................10
-------------------
3.6 Liability
of Limiteds......................................10
---------------------
3.7
Participation in Partnership Business by Limiteds..........10
-------------------------------------------------
3.8 Priority
Among Limiteds....................................11
-----------------------
ARTICLE FOUR RIGHTS, POWERS AND DUTIES OF
THE GENERAL PARTNERS...............11
-------------------------------------------------
4.1 Authorized
Acts; Management and Control....................11
---------------------------------------
4.2
Restrictions on Authority of the Managing Partner
-------------------------------------------------
and Executive Committee....................................12
-----------------------
4.3 Removal or
Dismissal of Certain Partners...................12
----------------------------------------
4.4 Executive
Committee........................................13
-------------------
4.5 Guaranteed
Draw; Time and Effort; Independent Activities...14
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4.6 Duties and
Obligations of the Managing Partner.............15
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4.7 Liability
for Acts and Omissions; Indemnification..........15
-------------------------------------------------
4.8 Dealing
with an Affiliate..................................16
-------------------------
4.9 General
Partners' Responsibility...........................16
--------------------------------
4.10
Responsibilities of Partnership Leaders....................16
---------------------------------------
ARTICLE FIVE MEETINGS AND VOTING OF
PARTNERS.................................16
-------------------------------
5.1 Meetings
of General Partners; Voting at Such Meetings......16
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5.2 Percentage
of Voting Power for Partnership Decisions.......17
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5.3 Robert's
Rules to Govern...................................17
------------------------
5.4 Consent of
General Partners in Lieu of a Meeting...........17
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ARTICLE SIX EVENT OF WITHDRAWAL OF A
PARTNER AND CONVERSION OF CLASS II
-----------------------------------------------------------
SUBORDINATED LIMITED PARTNER CAPITAL TO CLASS I SUBORDINATED
------------------------------------------------------------
LIMITED PARTNER
CAPITAL.............................................18
-----------------------
6.1 Voluntary
Event of Withdrawal..............................18
-----------------------------
6.2 Withdrawal
Upon Request....................................18
-----------------------
6.3 Return of
Capital and Purchase of Interest.................18
------------------------------------------
6.4 Death of a
Limited.........................................20
------------------
6.5 Death or
Disability of a General Partner...................20
----------------------------------------
6.6 General
Partner Interest - 56th Birthday...................21
----------------------------------------
6.7
Restriction on Capital Contribution Return.................22
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i
<PAGE>
6.8 Liability
of a Withdrawn General Partner...................22
----------------------------------------
6.9 Effect of
Event of Withdrawal..............................22
-----------------------------
6.10
Conversion from Class II to Class I Subordinated
------------------------------------------------
Limited Partner............................................23
---------------
ARTICLE SEVEN TRANSFERABILITY OF PARTNER
INTERESTS...........................23
------------------------------------
7.1
Restrictions on Transfer...................................23
------------------------
7.2
Substituted Limited Partners...............................24
----------------------------
ARTICLE EIGHT DISTRIBUTIONS AND
ALLOCATIONS; LIABILITY OF GENERAL PARTNERS...24
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8.1
Distribution of Net Income.................................24
--------------------------
8.2
Distributions Upon Dissolution.............................26
------------------------------
8.3
Distribution of Frozen Appreciation Amount.................26
------------------------------------------
8.4 Sale of
Assets to Third Party..............................27
-----------------------------
8.5 Other
Sales or Dispositions to Third Party.................27
------------------------------------------
8.6 Allocation
of Profits and Losses for Tax Purposes..........28
-------------------------------------------------
8.7 Liability
of General Partners..............................30
-----------------------------
ARTICLE NINE BOOKS, RECORDS AND REPORTS,
ACCOUNTING, TAX ELECTIONS, ETC. ....30
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9.1 Books,
Records and Reports.................................30
--------------------------
9.2
Bank
Accounts..............................................31
-------------
9.3
Depreciation and Elections.................................31
--------------------------
9.4 Fiscal
Year................................................31
-----------
ARTICLE TEN
MEDIATION/ARBITRATION............................................31
---------------------
10.1
Mediation/Arbitration......................................31
---------------------
10.2
Forum Selection............................................33
---------------
10.3
Statute of Limitations.....................................33
----------------------
10.4
Other Agreements...........................................34
----------------
ARTICLE ELEVEN GENERAL
PROVISIONS............................................34
------------------
11.1
Appointment of Attorneys-in-Fact...........................34
--------------------------------
11.2
Word Meanings..............................................35
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11.3
Binding Provisions.........................................35
------------------
11.4
Applicable Law.............................................35
--------------
11.5
Counterparts...............................................35
------------
11.6
Entire Agreement...........................................35
----------------
11.7
Separability of Provisions.................................35
--------------------------
11.8
Representations............................................36
---------------
11.9
Section Titles.............................................36
--------------
11.10
Partition..................................................36
---------
11.11 No
Third Party Beneficiaries...............................36
----------------------------
11.12
Amendments.................................................36
----------
11.13
Revocable Trusts...........................................36
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ii
<PAGE>
THE JONES FINANCIAL COMPANIES, L.L.L.P.
(a Missouri Registered Limited Liability Limited Partnership)
THIRTEENTH
AMENDED AND RESTATED
AGREEMENT OF REGISTERED
LIMITED LIABILITY LIMITED PARTNERSHIP
THIS FOURTEENTH AMENDED AND RESTATED AGREEMENT OF
REGISTERED LIMITED LIABILITY LIMITED
PARTNERSHIP of The Jones Financial
Companies, L.L.L.P. entered into as of this
1st day of January, 2004, by and
among Douglas E. Hill as General Partner,
and Douglas E. Hill as the
Attorney-In-Fact for all of the other
General Partners, all of the Limited
Partners, all of the Class I Subordinated
Limited Partners (none at the date
of this Agreement) and all of the Class II
Subordinated Limited Partners
(formerly referred to as the "Subordinated
Limited Partners").
W I T N E S S E T H:
WHEREAS, the Partnership was formed as a limited
partnership under the Missouri Revised
Uniform Limited Partnership Act
pursuant to an Agreement and Certificate of
Limited Partnership dated June
5, 1987;
WHEREAS, the Partnership filed on July 15, 1987 its
Amended and Restated Agreement and
Certificate of Limited Partnership dated
July 15, 1987 (the "Restated
Agreement");
WHEREAS, the Partnership filed on August 28, 1987,
November 16, 1987, August 5, 1988, August
29, 1988, January 31, 1989, March
21, 1989 and August 10, 1989 its Amendments
No. 1, 2, 3, 4, 5, 6 and 7
respectively, to its Restated
Agreement;
WHEREAS, the Partnership filed on June 22, 1989 its Partner
List as of May 31, 1989;
WHEREAS,
the Restated Agreement as amended is hereinafter
referred to as the "First Restated
Agreement";
WHEREAS, the First Restated Agreement was amended and
restated in its entirety pursuant to a
Second Amended and Restated Agreement
and Certificate of Limited Partnership
dated as of January 31, 1990 (the
"Second Restated Agreement");
WHEREAS, the Missouri Revised Uniform Limited Partnership
Act was amended in August of 1990 and no
longer requires certain information
in certificates of limited partnership
(filed with the Secretary of State)
and now requires corresponding amendments
to be made to agreements of
limited partnership;
WHEREAS, the Partnership desired that the aforesaid Second
Restated Agreement become two separate
documents, namely a Third Amended and
Restated Agreement of Limited Partnership
(the "Third Restated Agreement")
and a separate restated Certificate of
Limited Partnership;
<PAGE>
WHEREAS, the Second Restated Agreement was amended and
restated in its entirety pursuant to said
Third Restated Agreement dated as
of January 31, 1991;
WHEREAS, the Third Restated Agreement was amended and
restated in its entirety pursuant to the
Fourth Amended and Restated
Agreement of Limited Partnership (the
"Fourth Restated Agreement") dated as
of January 1, 1993;
WHEREAS, the Fourth Restated Agreement was amended and
restated in its entirety pursuant to the
Fifth Amended and Restated
Agreement of Limited Partnership (the
"Fifth Restated Agreement") dated as
of May 24, 1993;
WHEREAS, the Fifth Restated Agreement was amended and
restated in its entirety pursuant to the
Sixth Amended and Restated
Agreement of Limited Partnership (the
"Sixth Restated Agreement") dated as
of October 1, 1993;
WHEREAS, the Sixth Restated Agreement was amended and
restated in its entirety pursuant to the
Seventh Amended and Restated
Agreement of Limited Partnership (the
"Seventh Restated Agreement") dated as
of August 31, 1996;
WHEREAS, the Seventh Restated Agreement was amended and
restated in its entirety to register the
Partnership as a registered limited
liability partnership pursuant to the
Eighth Amended and Restated Agreement
of Limited Partnership (the "Eighth
Restated Agreement") dated as of
November 1, 1996;
WHEREAS, the Partnership filed as of February 26, 1998 an
Amendment to the Certificate of Limited
Partnership changing the
Partnership's name from The Jones Financial
Companies, L.P., LLP to The
Jones Financial Companies, L.L.L.P.;
WHEREAS, the Eighth Restated Agreement was amended and
restated in its entirety pursuant to the
Ninth Amended and Restated
Agreement of Registered Limited Liability
Limited Partnership (the "Ninth
Restated Agreement") dated as of April 1,
1998; and
WHEREAS, the Ninth Restated Agreement was amended and
restated in its entirety pursuant to the
Tenth Amended and Restated
Agreement of Registered Limited Liability
Limited Partnership (the "Tenth
Restated Agreement") dated as of February
25, 1999; and
WHEREAS, the Tenth Restated Agreement was amended and
restated in its entirety pursuant to the
Eleventh Amended and Restated
Agreement of Registered Limited Liability
Limited Partnership (the "Eleventh
Restated Agreement") dated as of May 23,
2000; and
WHEREAS, the Eleventh Restated Agreement was amended and
restated in its entirety pursuant to the
Twelfth Amended and Restated
Agreement of Registered Limited Liability
Limited Partnership (the "Twelfth
Restated Agreement") dated as of June 15,
2001; and
WHEREAS, the Twelfth Restated Agreement was amended and
restated in its entirety pursuant to the
Thirteenth Amended and Restated
Agreement of Registered Limited Liability
Limited Partnership (the
"Thirteenth Restated Agreement") dated as
of February 11, 2003; and
2
<PAGE>
WHEREAS, WHEREAS, the parties now desire to amend and
restate said Thirteenth Restated Agreement
in its entirety (to reflect the
election by the Executive Committee of
Douglas E. Hill as Managing Partner,
effective January 1, 2004); and pursuant to
this Fourteenth Amended and
Restated Agreement of Registered Limited
Liability Limited Partnership.
NOW, THEREFORE, pursuant to the terms, covenants and
conditions set forth herein and the mutual
promises contained herein, the
parties hereto agree as follows:
ARTICLE ONE
DEFINED TERMS
The defined terms used in this Agreement shall have the
meanings specified below:
"Affiliate" of a specified person (the "Specified Person")
---------
means any Person (a) who directly or
indirectly controls, is controlled by,
or is under common control with the
Specified Person; (b) who owns or
controls ten percent (10%) or more of the
Specified Person's outstanding
voting securities or equity interests; (c)
in whom such Specified Person
owns or controls ten percent (10%) or more
of the outstanding voting
securities or equity interests; (d) who is
a director, partner, manager,
executive officer or trustee of the
Specified Person; (e) in whom the
Specified Person is a director, partner,
manager, executive officer or
trustee; or (f) who has any relationship
with the Specified Person by blood,
marriage or adoption, not more remote than
first cousin.
"Agreement" means this Fourteenth Amended and Restated
---------
Agreement of Registered Limited Liability
Limited Partnership, as amended
from time to time.
"Capital Account" means an account established by the
---------------
Partnership and maintained for each
Partner, for federal income tax
purposes, which account shall be credited
with:
(i) the amount
of the Partner's Capital Contributions;
and
(ii)
the amount of Partnership income (including income
exempt from federal income tax) and gain (or items thereof)
allocated
to the Partner pursuant to Article Eight hereof;
and which shall be debited by:
(iii) the
amount of Partnership losses and deductions
(or items thereof) allocated to the Partner pursuant to Article
Eight hereof;
(iv)
the amount of Partnership expenditures described
in Treasury
Regulations Section 1.704-1(b)(2)(iv)(i) allocable to
the Partner in the same proportion as that in which the Partner
bears
the economic burden of those expenditures; and
(v) the amount
of all distributions to the Partner
pursuant to Article Eight hereof.
In addition, the Capital Account of each Partner shall be
adjusted as necessary to comply with
Treasury Regulations Section
1.704-1(b)(2)(iv). In the event the
Managing Partner shall determine that it
is prudent to modify the manner in which
the Capital Accounts or any debits
or credits thereto are completed in order
to comply with such regulations,
the Managing Partner may
3
<PAGE>
amend this Agreement to reflect such
modification, provided that it is not
likely to have a material effect on the
amounts distributable to the
Partners pursuant to Article Eight upon
dissolution of the Partnership.
If any Partner would otherwise have a negative balance in
his Capital Account, the amount of any such
negative balance shall be
reduced (but not in excess of such negative
balance) by the amount of such
Partner's share of Partnership Minimum Gain
(determined in accordance with
Treasury Regulations Section
1.704-1(b)(4)(iv)(f)) after taking into account
all increases and decreases to such
Partnership Minimum Gain during the
taxable year.
In the event that the Partnership is deemed to be
terminated for federal income tax purposes
due to the sale or exchange of
fifty percent (50%) or more of the
Partnership interests within a twelve
(12) month period, appropriate adjustment
shall be made to the Capital
Accounts to reflect such termination as
required by the Internal Revenue
Code and applicable Treasury
Regulations.
In the event that interests in the Partnership are sold,
exchanged or otherwise transferred, and the
transfer is recognized under
Article Six or Article Seven hereof, or by
operation of law, the Capital
Account of the transferee will equal the
Capital Account of the transferor
immediately before the transfer. However,
if such a sale or exchange, either
alone or in combination with other sales or
exchanges within a twelve-month
period results in a transfer of fifty
percent (50%) or more of the
Partnership interests causing a termination
of the Partnership for federal
income tax purposes, the adjustment
required by the immediately preceding
paragraph shall be made.
"Capital Contribution" means the total amount of cash or
--------------------
property contributed as equity to the
Partnership by each Partner pursuant
to the terms of this Agreement. The Capital
Contributions of the Partners
have been previously set forth on exhibits
to this Agreement. From the date
hereof, the Capital Contributions of the
Partners shall be reflected in the
books and records of the Partnership.
"Certificate of Limited Partnership" means the document,
----------------------------------
as amended or restated from time to time,
filed as a certificate of limited
partnership under the Missouri Limited
Partnership Act.
"Class I Subordinated Limited Partners" means those
-------------------------------------
persons whose names are set forth in the
books and records of the
Partnership as Class I Subordinated Limited
Partners, and any other person
who becomes a Class I Subordinated Limited
Partner of the Partnership as
provided herein.
"Class II Subordinated Limited Partners" means those
--------------------------------------
persons whose names are set forth in the
books and records of the
Partnership as Class II Subordinated
Limited Partners, and any other person
who becomes a Class II Subordinated Limited
Partner of the Partnership as
provided herein.
"Dispute" shall have the meaning set forth in Section
-------
10.1A.
"EDJ" shall have the meaning set forth in Section 2.3.
---
4
<PAGE>
"Event of Withdrawal" means, as to a General Partner, the
-------------------
occurrence of death, adjudication of mental
incompetence, bankruptcy,
dissolution, or voluntary or involuntary
withdrawal or removal from the
Partnership or any other event of
withdrawal set forth in the Missouri
Limited Partnership Act.
"Frozen Appreciation Amount" means each General Partner's
--------------------------
share of the unrealized appreciation of
certain real estate (the "Real
Estate") owned by EDJ Leasing Co. on the
date such General Partner
contributes his general partnership
interest in EDJ Leasing Co. to the
Partnership plus such General Partner's
share of the unrealized appreciation
of all stock exchange seats (the "Exchange
Seats") owned by or for the
benefit of Edward D. Jones & Co., L.P.
on the date such General Partner
contributes his general partnership
interest in Edward D. Jones & Co., L.P.
to the Partnership. The Frozen Appreciation
Amount shall be maintained in
the books and the records of the
Partnership. The Real Estate currently
consists of the land and improvements
located at 201 Progress Parkway, 141
Progress Parkway, 158 Progress Parkway, 115
Progress Parkway, 135 Progress
Parkway, 9 American Industrial Dr. and 20
American Industrial Dr., all in
St. Louis County, Missouri. The Exchange
Seats consists of one (1) seat on
the New York Stock Exchange, and one (1)
seat on the Chicago Stock Exchange
or any such seats on successor exchanges.
Each year, as of December 31, if
in the opinion of the Managing Partner
there has been a material diminution
in the value of the Real Estate, the
Partnership shall appraise (to the
extent not previously sold) the Real Estate
and the shares of unrealized
appreciation shall be appropriately and
proportionately adjusted for each
General Partner on the books of the
Partnership. On each Valuation Date, if
needed for the purpose of making a
calculation for purposes of this
Agreement, the Partnership shall appraise
(to the extent not previously
sold) the Exchange Seats and the shares of
unrealized appreciation shall be
appropriately and proportionately adjusted
for each General Partner on the
books of the Partnership. The unrealized
appreciation per each separate
tract of Real Estate and per each separate
Exchange Seat as set forth on the
books of the Partnership may never exceed
the amount used in making the
original calculation even if a given
appraised value later exceeds such
amount. When, as and if a given tract of
Real Estate or Exchange Seat is
sold, the unrealized appreciation then
attributable to such tract of Real
Estate or Exchange Seat shall no longer be
included in the calculation of
the Frozen Appreciation Amount on the books
of the Partnership.
"General Partners" means those persons whose names are set
----------------
forth in the books and records of the
Partnership as being General Partners,
and any other Person who becomes a
successor or additional General Partner
of the Partnership as provided herein.
"General Partner's Adjusted Capital Contribution" means
-----------------------------------------------
the Capital Contribution of the General
Partner plus all Net Income
thereafter allocated to the account of the
General Partner minus (a) all Net
Loss thereafter allocated to the account of
the General Partner, and (b) any
cash or property thereafter distributed to
(or for the benefit of) the
General Partner. Payments of salaries,
bonuses or expenses to a General
Partner by the Partnership shall not affect
such General Partner's Adjusted
Capital Contribution.
"General Partner Interest" means a General Partner's
------------------------
entire ownership interest in the
Partnership.
"General Partner Percentage" means a percentage determined
--------------------------
by dividing a General Partner's Adjusted
Capital Contribution by the
Adjusted Capital Contributions of all of
the General Partners.
5
<PAGE>
"Grantors" shall have the meaning set forth in Section 11.13.
--------
"Internal Revenue Code" means the Internal Revenue Code of
---------------------
1986, as amended from time to time.
"Limited Partner Withdrawal Notice" shall have the meaning
---------------------------------
set forth in Section 6.1B.
"Limited Partners" means those persons whose names are set
----------------
forth in the books and records of the
Partnership as being Limited Partners,
and any other person who becomes a Limited
Partner of the Partnership as
provided herein.
"Limiteds" means those persons whose names are set forth
--------
in the books and records of the Partnership
as being the Limited Partners,
Class I Subordinated Limited Partners and
the Class II Subordinated Limited
Partners, and any other person who becomes
a Limited of the Partnership as
provided herein.
"Mandatory Withdrawal Notice" shall have the meaning set
---------------------------
forth in Section 6.2.
"Missouri Limited Partnership Act" means the Missouri
--------------------------------
Revised Uniform Limited Partnership Act, as
amended from time to time.
"Missouri Partnership Act" means the Missouri Uniform
------------------------
Partnership Law, as amended from time to
time.
"NASD" shall have the meaning set forth in Section 10.1E.
----
"Net Income or Net Loss" means, with respect to any fiscal
----------------------
period, the net income or the net loss of
the Partnership, determined in
accordance with generally accepted
accounting principles; provided, however,
there shall be excluded from such net
income or net loss (after deduction of
the guaranteed payments required by Section
3.3B hereof and the bonus
compensation provided for in Section
4.1B(v) hereof) any unrealized gains or
losses on securities or rights or options
to acquire securities held by the
Partnership (or by any entity whose
financial statements are consolidated
with the financial statements of the
Partnership) as (a) a hedge against
fixed rate borrowings or (b) as long term
passive investments (usually
minority interests) (in the case of both
(a) and (b), as opposed to other
securities held by the Partnership [or by
any entity whose financial
statements are consolidated with the
financial statements of the
Partnership] as inventory for resale in the
ordinary course of business).
"Notice" means a writing, containing the information
------
required by this Agreement to be
communicated to a party, delivered
personally or sent by U.S. mail, postage
prepaid, to such party at the last
known address of such party as shown on the
records of the Partnership, the
date of personal delivery or the date of
mailing thereof being deemed the
date of receipt thereof.
"Partner" means any General Partner or Limited.
-------
6
<PAGE>
"Partnership" means the limited partnership (originally
-----------
formed as a limited partnership which is
now registered as a registered
limited liability limited partnership)
continued by this Agreement by the
parties hereto, as said limited partnership
may from time to time be
constituted.
"Partnership Minimum Gain" means, for Partnership tax
------------------------
purposes, as set forth in Treasury
Regulations Section 1.704-1(b)(4)(iv)(c),
the amount of gain, if any, that would be
realized by the Partnership if it
were to sell or dispose of (in a taxable
transaction) property subject to a
non-recourse liability of the Partnership,
in full satisfaction of such
liability.
"Party" shall have the meaning set forth in Section 10.1A.
-----
"Person" means a natural person, partnership, limited
------
partnership (domestic or foreign), limited
liability partnership, limited
liability limited partnership, limited
liability company, trust, estate,
association or corporation.
"Premium" shall have the meaning set forth in Section 8.4D.
-------
"Price" shall have the meaning set forth in Section 6.3A.
-----
"Proceeds of Liquidation" shall have the meaning set forth
-----------------------
in Section 8.2A.
"Profits and Losses For Tax Purposes" means, for
-----------------------------------
Partnership accounting and tax purposes,
the various items set forth in
Section 702(a) of the Internal Revenue Code
and all applicable regulations
or any successor law, and shall include,
but not be limited to, each item of
income, gain, deduction, loss, preference
or credit.
"Reduced Amount" shall have the meaning set forth in
--------------
Section 8.1A(iii).
"Requested Withdrawal Amount" shall have the meaning set
---------------------------
forth in Section 6.3G.
"Retiring Interest" shall have the meaning set forth in
-----------------
Section 6.6.
"Sale" shall have the meaning set forth in Section 8.4A.
----
"Treasury Rate" shall have the meaning set forth in
-------------
Section 8.1A(ii).
"Trusts" shall have the meaning set forth in Section 11.13.
------
"Withdrawal Notice" shall have the meaning set forth in
-----------------
Section 6.3G.
"Valuation Date" means as of the last Friday of each month
--------------
except for the month of December in which
case it means as of the last day
of the month.
7
<PAGE>
ARTICLE TWO
CONTINUATION, NAME AND OFFICE, PURPOSES,
----------------------------------------
TERM AND DISSOLUTION,
---------------------
REGISTERED AGENT, PARTNER LIST
------------------------------
2.1
Continuation.
------------
The parties hereto hereby continue the Partnership as a
registered limited liability limited
partnership pursuant to the provisions
of the Missouri Limited Partnership Act and
the Missouri Partnership Act.
2.2 Name,
Place of Business and Office.
----------------------------------
The Partnership shall be conducted under the name of "The
Jones Financial Companies, L.L.L.P.". The
principal office and place of
business shall be 12555 Manchester Road,
Des Peres, Missouri 63131. The
General Partners may at any time change the
location of such principal
office. Notice of any such change shall be
given to the Partners on or
before the date of any such change.
2.3
Purposes.
--------
The purposes of the Partnership shall be to act as a
limited partner in Edward D. Jones &
Co., L.P., ("EDJ") to act as a general
partner, limited partner, guarantor,
stockholder or holding partnership for
any other limited partnership, general
partnership, limited liability
partnership, limited liability limited
partnership, limited liability
company, corporation or other entity and to
engage in such other activities
as may be approved by the General
Partners.
2.4 Term and
Dissolution.
--------------------
A. The
Partnership shall continue in full force and
effect until December 31, 2199, or until
dissolution prior thereto upon the
happening of any of the following
events:
(i) The sale
of all of the assets of the Partnership;
(ii)
An Event of Withdrawal of a General Partner if no
General Partner remains; or
(iii) The
dissolution of the Partnership by the General
Partners.
B. Upon
dissolution of the Partnership, the General
Partners shall cause the cancellation of
the Partnership's Certificate of
Limited Partnership, liquidate the
Partnership's assets and apply and
distribute the proceeds thereof in
accordance with Section 8.2 hereof.
2.5 Registered
Office and Agent.
---------------------------
The name and address of the Registered Agent and
Registered Office for service of process on
the Partnership are as set forth
in the Certificate of Limited
Partnership.
8
<PAGE>
2.6 Amendment
to Certificate of Limited Partnership.
-----------------------------------------------
The Certificate of Limited Partnership shall be amended
within thirty days of the admission or
withdrawal of a General Partner.
ARTICLE THREE
PARTNERS AND CAPITAL
--------------------
3.1 General
Partners.
----------------
A. The
name, last known mailing address and current
Capital Contribution of each General
Partner are reflected in the books and
records of the Partnership.
B. Any
General Partner, in addition to being a General
Partner, may also become a Limited by
complying with the provisions of
Section 3.4 hereof. In such event, said
General Partner shall have all the
rights and powers and be subject to all the
restrictions of a General
Partner, except that, in respect to his
Capital Contribution as a Limited,
he shall have the rights against the other
Partners which he would have had
if he were not also a General Partner.
C. From
time to time, the Managing Partner may allow
one or more General Partners to increase
their Capital Contributions. Such
increased Capital Contributions shall be
made in such amount and manner and
at such time as determined by the Managing
Partner and the General Partner's
Percentages shall be appropriately adjusted
and transferred. All such
changes shall be reflected in the books and
records of the Partnership.
3.2 Admission
of Additional General Partners.
----------------------------------------
A.
The
Managing Partner may at any time designate
additional General Partners with such
interest in the Partnership as the
Managing Partner and such additional
General Partners may agree upon. The
additional General Partner shall make his
Capital Contribution to the
Partnership in such manner and at such time
as determined by the Managing
Partner and the General Partner Percentages
shall be appropriately adjusted
and transferred. All such changes shall be
reflected in the books and
records of the Partnership. The Managing
Partner may admit additional
General Partners to the Partnership at any
time without the consent of any
current General Partner or Limited.
B. Each
additional General Partner shall agree, as a
condition to becoming an additional General
Partner, to be bound by the
terms and provisions of this Agreement and
any other agreement (including
cash subordination agreements) as deemed
appropriate by the Managing
Partner.
3.3 Limiteds
and Contained Payments to Limited Partners.
---------------------------------------------------
A.
There shall be three classes of Limiteds, namely,
Limited Partners, Class I Subordinated
Limited Partners and Class II
Subordinated Limited Partners. The name,
last known mailing address and
current Capital Contribution of each
Limited Partner, Class I Subordinated
Limited Partner and Class II Subordinated
Limited Partner are reflected in
the books and records of the
Partnership.
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B. Each
Limited Partner shall be paid 7-1/2% per
annum, on the principal amount of his
Capital Contribution. Such payments
shall be made yearly or more frequently, as
determined by the Managing
Partner. All such payments shall be treated
as guaranteed payments.
3.4 Admission
of Limiteds.
---------------------
A. The
Managing Partner is authorized to admit to the
Partnership Limiteds who may be admitted as
Limited Partners, Class I
Subordinated Limited Partners or as Class
II Subordinated Limited Partners,
at the discretion of the Managing
Partner.
B. The
Capital Contributions of the Limiteds shall be
made in such manner and at such time as
determined by the Managing Partner.
All such changes shall be reflected in the
books and records of the
Partnership.
C. Each
Limited shall agree, as a condition to
becoming a Limited, to be bound by the
terms and provisions of this
Agreement and any other agreements
(including cash subordination agreements)
as deemed appropriate by the Managing
Partner.
3.5
Partnership Capital.
-------------------
A. The
total capital of the Partnership shall be the
aggregate amount of the Capital
Contributions of the Partners as provided
for herein.
B.
Except as provided herein, or as otherwise
determined by the Managing Partner, no
Partner shall be paid interest on any
Capital Contribution to the
Partnership.
C.
Except as otherwise provided herein, prior to
dissolution of the Partnership, no Partner
shall have the right to demand
the return of his Capital Contribution. No
Partner shall have the right to
demand and receive property other than cash
in return for his Capital
Contribution.
D. The
General Partners shall have no personal
liability for the repayment of the Capital
Contribution of any Limited.
3.6 Liability
of Limiteds.
---------------------
A Limited shall only be liable to make the payment of his
Capital Contribution. Except as provided in
the Missouri Limited Partnership
Act, no Limited shall be liable for any
obligations of the Partnership.
After his Capital Contributions shall be
paid to the Partnership, no Limited
shall be required to make any further
Capital Contribution or lend any funds
to the Partnership, except as otherwise
expressly provided in this
Agreement.
3.7
Participation in Partnership Business by Limiteds.
-------------------------------------------------
No Limited (except one who may also be a General Partner,
and then only in his capacity as a General
Partner) shall participate in or
have any control over the Partnership
business (except as required by law)
or shall have any authority or right to act
for or bind the partnership. The
Limiteds hereby consent to the exercise by
the Managing Partner and the
General Partners of the powers conferred on
them by this Agreement.
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3.8 Priority
Among Limiteds.
-----------------------
Priorities as between classes of Limiteds as to
distributions are set forth in Article
Eight hereof.
ARTICLE FOUR
RIGHTS, POWERS AND DUTIES OF THE GENERAL PARTNERS
-------------------------------------------------
4.1 Authorized
Acts; Management and Control.
---------------------------------------
A.
Subject to the other provisions set forth below,
the General Partners have the exclusive
right to manage the business of the
Partnership and are hereby authorized to
take any action (including, but not
limited to, the acts authorized by Section
4.1C below) of any kind and to do
anything and everything in accordance with
the provisions of this Agreement.
B.
Douglas E. Hill is hereby designated by the General
Partners as the Managing Partner of the
Partnership. As the Managing Partner
he shall serve as Chairman of the Executive
Committee. As Managing Partner,
he shall have the absolute right (subject
to Section 4.4C hereof) to manage
the business of the Partnership on behalf
of the General Partners and is
hereby authorized to take on behalf of the
Partnership and the General
Partners any action (including, but not
limited to, the acts authorized by
Section 4.1C below) of any kind and to do
anything and everything in
accordance with the provisions of this
Agreement. The Managing Partner shall
have all the rights, powers and duties
usually vested in the managing
partner of a partnership including the
administration of this Partnership's
business and the determination of its
business policies and he shall control
the management and conduct of all of the
business transacted by the
Partnership. In particular, but not in
limitation of the foregoing, the
Managing Partner for, in the name and on
behalf of, the Partnership and the
General Partners is hereby specifically
authorized (i) to admit to the
Partnership any General Partner or Limited;
(ii) to dismiss (in accordance
with Section 6.2 hereof) from the
Partnership any General Partner or
Limited; (iii) to determine the General
Partner's Adjusted Capital
Contribution (and the related General
Partner Percentage) that each General
Partner (including the Managing Partner)
shall be entitled to maintain; (iv)
to determine the guaranteed draw (described
in Section 4.5A hereof) to be
paid to each General Partner (which
guaranteed draw shall be set forth on a
list to be maintained in the Managing
Partner's office which list shall be
available for inspection by the General
Partners); (v) to determine the
amount, if any, of bonus compensation (in
addition to the funds provided for
in Section 8.1A(iv) to be paid to one or
more Partners to assist such
Partner(s) in maintaining or making initial
or additional Capital
Contributions to the Partnership, provided,
however, such aggregate bonus
compensation in any calendar year shall not
exceed $1,500,000; (vi) to
determine the amount, if any, of the
Capital Contribution that each General
Partner or Limited shall be entitled to
maintain; (vii) to determine all
amounts, if any, to be distributed to the
Limiteds pursuant to Section 8.5
hereof; (viii) to convey title to any
assets of the Partnership; and (ix) to
execute all documents (including, but not
limited to, any loan documents or
guarantees) on behalf of the Partnership
and (x) to sign on behalf of the
Partnership and each of its Partners, all
documents and forms required by
(A) any domestic or foreign jurisdiction
where the Partnership is engaged in
business so as to qualify as a registered
limited liability limited
partnership or comparable entity and (B)
any governmental agency requiring
the Partnership to appoint a registered
agent and/or office for service of
process in such jurisdictions.
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C. The
General Partners for, in the name and on
behalf of, the Partnership are hereby
authorized to take any and all
actions, and to engage in any kind of
activity and to perform and carry out
all functions of any kind necessary to, or
in connection with, the business
of the Partnership (including but not
limited to): (i) executing any
instruments on behalf of the Partnership;
(ii) acquiring or selling assets
of the Partnership; (iii) entering into
loans, guarantees in connection with
the business of the Partnership; (iv)
acting as a partner or shareholder of,
or adviser to, any other organization; (v)
contributing capital, as a
limited partner or as a general partner, or
purchasing other securities in
or otherwise investing in EDJ or any other
limited partnership, general
partnership, corporation or other entity
and taking all actions required as
a partner, shareholder or investor in any
such entity.
D. The
special authority granted herein to the
Managing Partner shall not be construed to
restrict the authority of any
General Partner to act as the agent of the
Partnership and to execute
instruments in the Partnership name for the
purpose of carrying on the
ordinary business of the Partnership.
E. The
Managing Partner may delegate to any General
Partner the authority from time to time to
execute documents or otherwise
exercise the authority of the Managing
Partner, but such authority shall not
include the authority to increase the
capital or change the business
policies of the Partnership unless such
authority is expressly and
specifically granted in writing to such
General Partner.
F.
Whenever authority is herein conferred upon the
Managing Partner or the General Partners,
any person, other than a General
Partner, dealing with the Partnership may
rely conclusively upon the
authority and signature of the Managing
Partner or any one other General
Partner to exercise such authority without
determining that such Managing
Partner or such General Partner is acting
with the approval of the other
General Partners. In addition, third
parties dealing with the Partnership
may rely upon the certification of the
Managing Partner or any other General
Partner as to the continued existence of
the Partnership, the identity of
its current Partners and the authority of
any Partner to execute any
document.
4.2
Restrictions on Authority of the Managing Partner
-------------------------------------------------
and Executive Committee.
-----------------------
In the event that a meeting of General Partners is called
by the General Partners in accordance with
Section 5.1 hereof to vote upon
the removal of the Managing Partner or an
Executive Committee member,
neither the Managing Partner nor the
Executive Committee shall from the time
of notice of such meeting until after
adjournment thereof: (i) change the
General Partner Percentage of any General
Partner or (ii) admit or dismiss
any General Partner as a Partner.
4.3 Removal or
Dismissal of Certain Partners.
----------------------------------------
The Managing Partner may be removed from such office and
any General Partner may be dismissed as a
General Partner (in accordance
with Section 6.2 hereof) by a vote of
General Partners holding a majority of
the General Partner Percentages in the
Partnership.
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<PAGE>
4.4 Executive
Committee.
-------------------
A. An
Executive Committee is hereby created consisting
of the Managing Partner and five (5) to
nine (9) additional General
Partners, the number thereof to be
determined from time to time by the
Managing Partner. There shall be maintained
in the office of the General
Counsel of the Partnership a list,
certified by the Managing Partner as
being true and correct, of the General
Partners, who in addition to the
Managing Partner, constitute the current
Executive Committee of the
Partnership. Among the purposes of the
Executive Committee is to provide
counsel and advice to the Managing Partner
in discharging his functions.
B. Each
member of the Executive Committee shall have
one vote.
C.
Upon
the majority vote of the Executive Committee,
the Executive Committee may override any
determination made by the Managing
Partner as to (i) the General Partner's
Adjusted Capital Contribution (and
the related General Partner Percentage)
that each General Partner (including
the Managing Partner) shall be entitled to
maintain, (ii) the admission of a
new General Partner and (iii) the dismissal
of a General Partner.
D. Upon
the majority vote of the Executive Committee,
the Managing Partner may be removed from
his office as the Managing Partner.
E. At
any time during which there is no Managing
Partner the Executive Committee shall
succeed to all of the powers and
duties of the Managing Partner.
F. Upon
the majority vote of the Executive Committee,
a new Managing Partner shall be elected
whenever the office of the Managing
Partner is vacant. Such vote shall be taken
within two (2) weeks after such
office becomes vacant.
G. If
the Executive Committee believes that the office
of the Managing Partner may become vacant,
for any reason whatsoever,
including, but not limited, to retirement
or resignation of the current
Managing Partner, then the Executive
Committee may establish procedures (as
it shall determine appropriate, in its sole
discretion) to review potential
candidates and then to choose from such
candidates the person to be the new
Managing Partner when the office of the
Managing Partner becomes vacant.
H. The
Managing Partner shall have the right to
appoint and dismiss any member of the
Executive Committee; provided however
that the Managing Partner shall not have
the right to dismiss any member of
the Executive Committee or increase or
decrease the number of General
Partners on the Executive Committee from
the time Notice is given of a
meeting of the Executive Committee until
the adjournment thereof if the
purpose of such meeting is to vote upon one
or more of the matters set forth
in Sections 4.4C or 4.4D hereof.
I. By a
vote of the General Partners holding a
majority of the General Partner Percentages
in the Partnership, the General
Partners may remove any Executive Committee
member from his position as an
Executive Committee member and elect in his
place a new Executive Committee
member.
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J. If
the General Partners remove any Executive
Committee member from his position as an
Executive Committee member, the
Managing Partner may not appoint such
removed Executive Committee member to
the Executive Committee for a period of six
(6) months thereafter. Any
Executive Committee member elected to the
Executive Committee by a vote of
the General Partners may not be dismissed
as an Executive Committee member
by the Managing Partner.
K. A
meeting of the Executive Committee shall be
held (i) at any time on call of the
Managing Partner after one (1) day's
Notice has been delivered to the Executive
Committee members or (ii) on at
least ten (10) day's Notice in advance to
the Executive Committee members,
jointly signed by any two (2) Executive
Committee members, specifying the
date, place, hour and purpose of the
meeting.
4.5 Guaranteed
Draw; Time and Effort; Independent
---------------------------------------------
Activities.
----------
A. Each
General Partner shall receive a guaranteed
draw for his services as determined by the
Managing Partner in his sole
discretion. Such guaranteed draw shall be
treated by the Partnership as a
guaranteed payment. Such guaranteed draw
shall be reduced by any net
commissions earned by any such General
Partner (and paid to such General
Partner by EDJ) who is principally engaged
in the sale of securities to the
public. If any such General Partner who is
principally engaged in the sale
of securities to the public at EDJ incurs
any reasonable expenses through
usual and ordinary means of generating the
sales upon which such General
Partner is entitled to receive commissions
from EDJ, then such General
Partner must personally and individually
pay, without reimbursement from the
Partnership or from EDJ, such expense but
such General Partner shall be
entitled to deduct such expenses on his
personal income tax return, all as
permitted by the Internal Revenue Code.
B. Each
General Partner shall devote his entire time,
energy, skill and ability to the duties of
operating the Partnership and the
entities it owns. General Partners shall
not engage in outside business
activities without the prior written
consent of the Managing Partner. Each
General Partner agrees not to use the name
or property of the Partnership or
any entity it owns for his own private
business, nor for any purpose
whatsoever except those that may be
incidental to the conduct and management
of the Partnership, nor shall any General
Partner use the name of the
Partnership or any entity it owns for the
use or accommodation of any other
person. No General Partner shall incur any
obligation in the name of the
Partnership or transfer Partnership
property except in connection with
Partnership business.
C. Each
General Partner agrees that he will not,
without the written consent of the Managing
Partner (i) become a guarantor
or surety for any person, firm or
corporation; (ii) in the name of the
Partnership or any entity it owns or in his
own name buy or sell stocks,
securities or commodities on margin, either
for the account of the
Partnership or for his own account; or
(iii) pledge or hypothecate any of
the property of the Partnership or any
entity it owns for any purpose
whatsoever.
D. Each
General Partner shall submit, upon request
by the Managing Partner, a copy of any of
his current personal income tax
returns (for any time period during which
such Partner was a Partner of the
Partnership) for inspection by independent
accountants selected by the
Managing Partner. In addition, each General
Partner agrees, if requested by
the Managing Partner, to have such General
Partner's income tax returns
prepared by an entity (which could be
the
14
<PAGE>
Partnership itself or independent
accountants) selected by such General
Partner and acceptable to the Managing
Partner.
E. Each
Partner is expected, and it is regarded as
such Partner's duty, to supplement
expens
