10-Q 1 c66163e10-q.txt QUARTERLY REPORT SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED: SEPTEMBER 30, 2001 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period From ____________ To ____________ COMMISSION FILE NUMBER: 0-23950 KENMAR PERFORMANCE PARTNERS L.P. (Exact name of registrant as specified in its charter) NEW YORK 11-2751509 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) Two American Lane, P.O. Box 5150, Greenwich, Connecticut 06831-8150 (Address of principal executive offices, including zip code) Registrant's telephone number, including area code: (203) 861-1000 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No __ KENMAR PERFORMANCE PARTNERS L.P. QUARTER ENDED SEPTEMBER 30, 2001 INDEX PAGE PART I - FINANCIAL INFORMATION Item 1. Financial Statements Statements of Financial Condition as of September 30, 2001 (unaudited) and December 31, 2000 (audited) 3 Statements of Operations for the Three and Nine Months Ended September 30, 2001 and 2000 (unaudited) 4 Statements of Changes in Partners' Capital (Net Asset Value) for the Nine Months Ended September 30, 2001 and 2000 (unaudited) 5 Notes to Financial Statements (unaudited) 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 11 Item 3. Quantitative and Qualitative Disclosures About Market Risk 14 PART II - OTHER INFORMATION Item 2. Changes in Securities and Use of Proceeds 14 Item 6. Exhibits and Reports on Form 8-K 15 SIGNATURES 16 -2- KENMAR PERFORMANCE PARTNERS L.P. STATEMENTS OF FINANCIAL CONDITION September 30, 2001 (Unaudited) and December 31, 2000 (Audited)

See accompanying notes. -3- KENMAR PERFORMANCE PARTNERS L.P. STATEMENTS OF OPERATIONS For the Three Months Ended September 30, 2001 and 2000 and For the Nine Months Ended September 30, 2001 and 2000 (Unaudited)

See accompanying notes. -4- KENMAR PERFORMANCE PARTNERS L.P. STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (NET ASSET VALUE) For the Nine Months Ended September 30, 2001 and 2000 (Unaudited)

See accompanying notes. -5- KENMAR PERFORMANCE PARTNERS L.P. NOTES TO FINANCIAL STATEMENTS (Unaudited) Note 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. General Description of the Partnership Kenmar Performance Partners L.P. (the Partnership) is a New York limited partnership. The Partnership is a multi-advisor, multi-strategy commodity pool which trades in United States (U.S.) and foreign futures, options and forward contracts. It is subject to the regulations of the Commodity Futures Trading Commission, an agency of the U.S. government which regulates most aspects of the commodity futures industry; rules of the National Futures Association, an industry self-regulatory organization; and the requirements of commodity exchanges where the Partnership executes transactions. Additionally, the Partnership is subject to the requirements of Futures Commission Merchants (FCMs) and interbank market makers (collectively, "brokers") through which the Partnership trades. The Partnership is a registrant with the Securities and Exchange Commission (SEC) pursuant to the Securities Exchange Act of 1934 (the Act). As a registrant, the Partnership is subject to the regulations of the SEC and the informational requirements of the Act. B. Method of Reporting The Partnership's financial statements are presented in accordance with accounting principles generally accepted in the United States of America, which require the use of certain estimates made by the Partnership's management. C. Commodities Gains or losses are realized when contracts are liquidated. Net unrealized gains or losses on open contracts (the difference between contract trade price and market price) are reflected in the statement of financial condition. Any change in net unrealized gain or loss from the preceding period is reported in the statement of operations. Brokerage commissions include other trading fees and are charged to expense when contracts are opened. D. Cash and Cash Equivalents Cash and cash equivalents includes cash and investments in money market mutual funds. Interest income includes interest-equivalent dividends on money market mutual funds. E. Fixed Income Securities Fixed income securities are reported at market value plus accrued interest. Fixed income securities transactions are accounted for on the trade date. Interest income is recorded on the accrual basis. -6- KENMAR PERFORMANCE PARTNERS L.P. NOTES TO FINANCIAL STATEMENTS (CONTINUED) (Unaudited) Note 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) F. Income Taxes The Partnership prepares calendar year U.S. and applicable state information tax returns and reports to the partners their allocable shares of the Partnership's income, expenses and trading gains or losses. G. Foreign Currency Transactions The Partnership's functional currency is the U.S. dollar; however, it transacts business in currencies other than the U.S. dollar. Assets and liabilities denominated in currencies other than the U.S. dollar are translated into U.S. dollars at the rates in effect at the date of the statement of financial condition. Income and expense items denominated in currencies other than the U.S. dollar are translated into U.S. dollars at the rates in effect during the period. Gains and losses resulting from the translation to U.S. dollars are reported in income currently. Note 2. GENERAL PARTNER The General Partner of the Partnership is Kenmar Advisory Corp., which conducts and manages the business of the Partnership. The General Partner is required by the Limited Partnership Agreement to maintain an investment in the Partnership of 1% of the Net Asset Value, up to a total of $500,000. A portion of the brokerage commissions paid by the Partnership to certain brokers is, in turn, paid by the brokers to the General Partner. Note 3. COMMODITY TRADING ADVISORS The Partnership has advisory agreements with various commodity trading advisors pursuant to which the Partnership pays monthly management fees of 0% to 1/12 of 2% (2% annually) of the net asset value under management (as defined in each respective advisory agreement) and quarterly incentive fees of 10% to 25% of the profit subject to incentive fee (as defined in each respective advisory agreement). Effective October 1, 2000, one of the commodity trading advisors pays the entire incentive fee of 10% to the General Partner. Such incentive fee amounted to $0 during the nine months ended September 30, 2001. Note 4. DEPOSITS WITH BROKERS The Partnership deposits cash with brokers subject to Commodity Futures Trading Commission regulations and various exchange and broker requirements. Margin requirements are satisfied by the deposit of cash with such brokers. The Partnership earns interest income on its cash deposited with the brokers. -7- KENMAR PERFORMANCE PARTNERS L.P. NOTES TO FINANCIAL STATEMENTS (CONTINUED) (Unaudited) Note 5. OTHER EXPENSES The General Partner pays substantially all ordinary operating and administrative expenses incurred by the Partnership. The Partnership pays the General Partner a monthly administrative fee equal to 1/12 of 1% (1% annually) of the prior month's beginning Net Asset Value of the Partnership. The Partnership also pays actual amounts incurred for cash management services and services performed by independent legal counsel. Note 6. SUBSCRIPTIONS, DISTRIBUTIONS AND REDEMPTIONS Investments in the Partnership are made by subscription agreement, subject to acceptance by the General Partner. The subscription price is equal to the Net Asset Value of the units purchased plus a 5% selling commission, unless waived in whole or in part by the General Partner. There were no selling commissions charged to units purchased during the nine months ended September 30, 2001 and 2000. The Partnership is not required to make distributions, but may do so at the sole discretion of the General Partner. A Limited Partner may request and receive redemption of units owned, subject to restrictions in the Limited Partnership Agreement. Note 7. TRADING ACTIVITIES AND RELATED RISKS The Partnership engages in the speculative trading of U.S. and foreign futures contracts, options on U.S. and foreign futures contracts and forward contracts (collectively, "derivatives"). The Partnership is exposed to both market risk, the risk arising from changes in the market value of the contracts, and credit risk, the risk of failure by another party to perform according to the terms of a contract. Purchase and sale of futures and options on futures contracts requires margin deposits with the FCMs. Additional deposits may be necessary for any loss on contract value. The Commodity Exchange Act requires an FCM to segregate all customer transactions and assets from such FCM's proprietary activities. A customer's cash and other property (for example, U.S. Treasury bills) deposited with an FCM are considered commingled with all other customer funds subject to the FCM's segregation requirements. In the event of an FCM's insolvency, recovery may be limited to a pro rata share of segregated funds available. It is possible that the recovered amount could be less than total cash and other property deposited. The Partnership deposits a substantial portion of its assets with brokers and dealers in securities and other financial institutions in connection with its trading of forward contracts and its cash management activities. In the event of a financial institution's insolvency, recovery of Partnership assets on deposit may be limited to account insurance or other protection afforded such deposits. Since forward contracts are traded in unregulated markets between principals, the Partnership also assumes the risk of loss from counterparty nonperformance. -8- KENMAR PERFORMANCE PARTNERS L.P. NOTES TO FINANCIAL STATEMENTS (CONTINUED) (Unaudited) Note 7. TRADING ACTIVITIES AND RELATED RISKS (CONTINUED) For derivatives, risks arise from changes in the market value of the contracts. Theoretically, the Partnership is exposed to a market risk equal to the value of futures and forward contracts purchased and unlimited liability on such contracts sold short. As both a buyer and seller of options, the Partnership pays or receives a premium at the outset and then bears the risk of unfavorable changes in the price of the contract underlying the option. Written options expose the Partnership to potentially unlimited liability, and purchased options expose the Partnership to a risk of loss limited to the premiums paid. The General Partner has established procedures to actively monitor market risk and minimize credit risk, although there can be no assurance that it will, in fact, succeed in doing so. The Limited Partners bear the risk of loss only to the extent of the market value of their respective investments and, in certain specific circumstances, distributions and redemptions received. Note 8. INTERIM FINANCIAL STATEMENTS The statement of financial condition as of September 30, 2001, the statements of operations for the three months and nine months ended September 30, 2001 and 2000, and the statements of changes in partners' capital (net asset value) for the nine months ended September 30, 2001 and 2000, are unaudited. In the opinion of management, such financial statements reflect all adjustments, which were of a normal and recurring nature, necessary for a fair presentation of financial position as of September 30, 2001, and the results of operations for the three months and nine months ended September 30, 2001 and 2000. -9- KENMAR PERFORMANCE PARTNERS L.P. NOTES TO FINANCIAL STATEMENTS (CONTINUED) (Unaudited) Note 9. FINANCIAL HIGHLIGHTS The following information contains per unit operating performance data for a unit outstanding during the entire three months and nine months ended September 30, 2001, and other supplemental financial data. This information has been derived from information presented in the financial statements.

---------- * Excludes brokerage commissions ** Includes brokerage commissions *** Not annualized (+) Annualized -10- ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. The assets of Kenmar Performance Partners L.P. (the "Partnership") are used for trading, buying, selling, spreading, swapping or otherwise acquiring, holding or disposing of commodities, futures contracts, forward contracts, foreign exchange commitments, swap contracts, exchange-for-physicals, spot (cash) commodities and other items, options on the foregoing, and any rights pertaining to the foregoing contracts, instruments or investments throughout the world (collectively, "Commodities") through the retention of professional commodity trading advisors (the "Advisors"). The assets of the Partnership are deposited with commodity brokers and foreign exchange dealers (collectively, the "Commodity Brokers") in trading accounts established by the Partnership for the Advisors and are used by the Partnership as margin to engage in trading. Such assets are held in either a non-interest bearing bank account or in securities approved by the Commodity Futures Trading Commission for investment of customer funds. In addition, certain of the Partnership's assets may be placed in a custodial account with a cash manager to maximize the interest earned on assets not committed as margin. CAPITAL RESOURCES The Partnership does not have, nor does it expect to have, any capital assets. Redemptions and sales of units of limited partnership interests ("Units") in the future will affect the amount of funds available for trading Commodities in subsequent periods. There are three primary factors that affect the Partnership's capital resources: (i) the trading profit or loss generated by the Advisors (including interest income); (ii) the capital invested or redeemed by the limited partners of the Partnership (the "Limited Partners"); and (iii) the capital invested or redeemed by the Partnership's general partner, Kenmar Advisory Corp. (the "General Partner"). The General Partner has maintained, and has agreed to maintain, at all times a capital account in such amount, up to a total of $500,000, as is necessary for the General Partner to maintain a one percent (1%) interest in the capital, income and losses of the Partnership. All capital contributions by the General Partner necessary to maintain such capital account balance are evidenced by units of general partnership interests, each of which has an initial value equal to the Net Asset Value per Unit (as defined below) at the time of such contribution. The General Partner, in its sole discretion, may withdraw any excess above its required capital contribution without notice to the Limited Partners. The General Partner, in its sole discretion, may also contribute any greater amount to the Partnership, for which it shall receive, at its option, additional units of general partnership interests or Units at their then-current Net Asset Value (as defined below). "Net Asset Value" is defined as total assets of the Partnership less total liabilities as determined in accordance with the principles set forth in the Second Restatement of the Limited Partnership Agreement of the Partnership, dated September 1, 1993, as amended December 1, 1995 (the "Partnership Agreement"), or where no such principles are specified therein, in accordance with United States generally accepted accounting principles applied on a consistent basis. The term "Net Asset Value Per Unit" is defined in the Partnership Agreement to mean the Net Asset Value of the Partnership divided by the number of Units issued and outstanding as of the date of computation. RESULTS OF OPERATIONS The Partnership incurs substantial charges from the payment of management and/or incentive fees to the Advisors and administrative fees to the General Partner which are payable based upon the Net Asset Value of the Partnership and are payable without regard to the profitability of the Partnership. The -11- brokerage commissions to the Commodity Brokers are also payable without regard to the profitability of the Partnership, although under certain circumstances such commissions have been, and may continue to be, higher when Advisors experience profits and, as a result, increase their trading activity. As a result, in certain years the Partnership has incurred a net loss when trading profits were not substantial enough to avoid depletion of the Partnership's assets from such fees and expenses. Thus, due to the nature of the Partnership's business, the success of the Partnership is dependent upon the ability of the Advisors to generate trading profits through the speculative trading of Commodities sufficient to produce capital appreciation after payment of all fees and expenses. The Advisors trade in various markets at different times, and prior activity in a particular market does not mean that such markets will be actively traded by an Advisor or will be profitable in the future and the Advisors trade independently of each other using different trading systems and may trade in different markets with various concentrations at various times. Consequently, the results of operations of the Partnership can only be discussed in the context of the overall trading activities of the Partnership, the Advisors' trading activities on behalf of the Partnership as a whole and how the Partnership has performed in the past. In general, Commodity Trading Advisors or CTAs analyze the movement of prices in the commodity and financial futures markets to identify trends and the opportunities for profit which accompany them. Because a CTA can take long or short positions in the futures markets, the direction of a trend is less important than the existence of a trend itself. A CTA has the potential to generate profits when prices are identified as trending downward, by going short or selling ahead of a price decline, and when prices appear to be trending upward, by going long or buying ahead of the rise in price. When prices are moving sideways (i.e., with little movement up or down) or are exhibiting significant short-term volatility (such as rapid intra-day or inter-day price swings) trends are few and far between, and CTA profits can be flat or negative. Set forth below is a comparison of the results of operations of the Partnership for the three-month and nine-month periods ended September 30, 2001 and 2000. As of September 30, 2001, the Net Asset Value of the Partnership was $7,242,958, a decrease of approximately 10.16% from its Net Asset Value of $8,062,223 at June 30, 2001. The Partnership's subscriptions and redemptions for the quarter ended September 30, 2001 totaled $0 and $386,069, respectively. For the quarter ended September 30, 2001, the Partnership had revenues comprised of $(109,224) in realized losses, $261,866 in change in unrealized gains and $74,553 in interest income compared to revenues comprised of $499,335 in realized gains, $22,212 in change in unrealized gains and $174,465 in interest income for the same period in 2000. The total income for the third quarter of 2001 decreased by $468,817 from the same period in 2000, while total expenses decreased by $1,074,128 between these periods. The Net Asset Value per Unit at September 30, 2001 decreased 5.43% from $6,425.93 at June 30, 2001 to $6,077.21 at September 30, 2001. The performance in the third quarter of 2001 resulted primarily from U.S. and Canadian interest rates, metals and tropicals. The Net Asset Value of the Partnership decreased $4,124,936, or 36.29%, from December 31, 2000 through September 30, 2001. The Partnership's subscriptions and redemptions for the nine months ended September 30, 2001 totaled $0 and $2,080,901, respectively. For the nine months ended September 30, 2001, the Partnership had revenues comprised of $1,265,583 in realized gains, $(1,027,820) in change in unrealized losses and $251,525 in interest income compared to revenue comprised of ($2,288,765) in realized losses, $206,879 in change in unrealized gains and $943,860 in interest income for the same period in 2000. The total income for the nine months of 2001 was $489,288 as compared to a loss of $1,138,026 for the same period in 2000 while expenses decreased by $4,817,173 between these periods. The Net Asset Value per Unit at September 30, 2001 decreased 20.56% from $7,649.82 at December 31, 2000 to $6,077.21 at September 30, 2001. The performance in the first nine months of 2001 resulted primarily from global stock indicies, energy and currencies. -12- For the reasons described in this Management's Discussion and Analysis, past performance is not indicative of future results. As a result, any recent increases or decreases in realized or unrealized trading gains may have no bearing on any results that may be obtained in the remainder of 2001 and future years. LIQUIDITY Although there is no public market for the Units, a Limited Partner may redeem its Units in the Partnership as of any month-end occurring six months or more after such investment was made. With respect to the Partnership's trading, in general, the Advisors will endeavor to trade only Commodities that have sufficient liquidity to enable them to enter and close out positions without causing major price movements. Notwithstanding the foregoing, most United States commodity exchanges limit the amount by which certain commodities may move during a single day by regulations referred to as "daily price fluctuation limits" or "daily limits". Pursuant to such regulations, no trades may be executed on any given day at prices beyond the daily limits. The price of a futures contract has occasionally moved the daily limit for several consecutive days, with little or no trading, thereby effectively preventing a party from liquidating its position. While the occurrence of such an event may reduce or effectively eliminate the liquidity of a particular market, it will not limit ultimate losses and may in fact substantially increase losses because of this inability to liquidate unfavorable positions. In addition, if there is little or no trading in a particular futures or forward contract that the Partnership is trading, whether such illiquidity is caused by any of the above reasons or otherwise, the Partnership may be unable to execute trades at favorable prices and/or may be unable or unwilling to liquidate its position prior to its expiration date, thereby requiring the Partnership to make or take delivery of the underlying interest of the Commodity. In addition, certain Advisors trade on futures markets outside the United States on behalf of the Partnership. Certain foreign exchanges may be substantially more prone to periods of illiquidity than United States exchanges. Further, certain Advisors trade forward contracts which are not traded on exchanges; rather banks and dealers act as principals in these markets. The Commodity Futures Trading Commission does not regulate trading on non-U.S. futures markets or in forward contracts. The Partnership's trading may also be impacted by the various conflicts of interest among the Partnership and the General Partner, the Advisors and the Commodity Brokers. SAFE HARBOR STATEMENT The discussions above and under the heading "Item 3. Quantitative and Qualitative Disclosures About Market Risk" contain certain "forward-looking statements" (as such term is defined in Section 21E of the Securities Exchange Act of 1934) that are based on the beliefs of the Partnership, as well as assumptions made by, and information currently available to, the Partnership. Words such as "expects," "anticipates" and similar expressions have been used to identify "forward-looking statements" but are not the exclusive means of identifying such statements. A number of important factors could cause the Partnership's actual results, performance or achievements for 2001 and beyond to differ materially from the results, performance or achievements expressed in, or implied by, such forward-looking statements. These factors include, without limitation, risk of failure by third parties to perform according to contract terms and the factors described above and under the heading "Item 3. Quantitative and Qualitative Disclosures About Market Risk." See "Management's Discussion and Analysis of Financial Condition and Results of Operations - Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2000 for further discussion. -13- ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. Derivative instruments involve varying degrees of off-balance sheet market risk. Changes in the level or volatility of interest rates or foreign currency exchange rates or the market values of the financial instruments or commodities underlying such derivative instruments frequently result in changes in the Partnership's unrealized profit (loss) on such derivative instruments as reflected in the Statements of Financial Condition included herein. The Partnership's exposure to market risk is influenced by a number of factors, including the relationships among derivative instruments held by the Partnership, as well as the volatility and liquidity of the markets in which the financial instruments are traded. There has been no material change, during the nine months ended September 30, 2001, in the sources of the Partnership's exposure to market risk. The General Partner has procedures in place intended to control the Partnership's exposure to market risk, although there can be no assurance that it will, in fact, succeed in doing so. These procedures focus primarily on monitoring the trading of the Advisors selected from time to time for the Partnership, calculating the Net Asset Value of the Advisors' respective Partnership accounts as of the close of business on each day and reviewing outstanding positions for over-concentrations - both on an Advisor-by-Advisor and an overall Partnership basis. While the General Partner will not itself intervene in the markets to hedge or diversify the Partnership's market exposure, the General Partner may urge Advisors to reallocate positions, or itself reallocate Partnership assets among Advisors (although typically only as of the end of a month) in an attempt to avoid over-concentrations. However, such interventions would be unusual. Except in cases in which it appears that an Advisor has begun to deviate from past practice or trading policies or to be trading erratically, the General Partner's basic risk control procedures consist of the ongoing process of Advisor monitoring and selection, with the market risk controls being applied by the Advisors themselves. PART II - OTHER INFORMATION ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS. In September 1985, the Partnership commenced a private placement of Units in reliance on the exemptions afforded by, among others, Section 4(2) of the Securities Act of 1933, as amended (the "1933 Act"), and Rule 506 of Regulation D promulgated thereunder. The sales qualify as an exempt offering under Rule 506 of Regulation D because they are made solely to "accredited investors," as defined by Regulation D. Similar reliance has been placed on available exemptions from securities qualification requirements under applicable state securities laws. Units are offered monthly at a price per Unit equal to the then current Net Asset Value per Unit, with a required minimum subscription of $25,000 for new investors other than individual retirement accounts ("IRAs") and qualified retirement plans and Keogh Plans ("Plans") and $10,500 for IRAs, Plans and existing Limited Partners, which minimums may be waived by the General Partner in its sole discretion. A subscriber may subscribe for Units in excess of the foregoing minimum amounts. As of the date hereof, the Partnership continues to offer Units, and there is no maximum number of Units that may be purchased or sold. During the third quarter of 2001, there were no units sold. -14- ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) The following exhibits are filed with this Report or incorporated by reference as set forth below: Number Exhibit 3.1* Certificate of Limited Partnership for Kenmar Performance Partners L.P. 3.2*** Second Restatement of the Limited Partnership Agreement of Kenmar Performance Partners L.P., as amended. 10.1* Customer Agreement between the Partnership and Refco, Inc. 10.2* Form of Advisory Agreement between Kenmar and the Advisor. 10.3** Master Agreement between the Fund and ING Derivatives, Ltd., dated as of March 22, 1995. 10.4*** Commodity Customer Agreement between the Fund and Internationale Nederlanden (U.S.) Derivatives Clearing, Inc. 10.5*** Netting Agreement and Customer Agreement between the Fund and Refco Capital Markets Ltd. * Incorporated herein by reference to the Partnership's Registration Statement on Form 10, filed with the Securities and Exchange Commission on April 29, 1994. ** Incorporated herein by reference to the Partnership's Annual Report on Form 10-K for the fiscal year ended December 31, 1994. *** Incorporated herein by reference to the Partnership's Annual Report on Form 10-K for the fiscal year ended December 31, 1995. (b) Reports on Form 8-K. The Partnership did not file any reports on Form 8-K during the third quarter of 2001. -15- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. KENMAR PERFORMANCE PARTNERS L.P. By: Kenmar Advisory Corp., general partner Dated: November 14, 2001 By: /s/ Kenneth A. Shewer --------------------------------------- Kenneth A. Shewer Chairman (Duly Authorized Officer of the General Partner) Dated: November 14, 2001 By: /s/ Thomas J. DiVuolo --------------------------------------- Thomas J. DiVuolo Senior Vice President (Principal Financial and Accounting Officer of the Registrant) -16-

KENMAR PERFORMANCE PARTNERS LP 10-Q