Exhibit 10.3
ADMINISTRATION AGREEMENT
THIS AGREEMENT, made this 30th day of October 2006, by:
DPM Mellon, LLC
000 Xxxxxx Xxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
("DPMM")
and
UBS Managed Futures LLC (Aspect Series)
c/o UBS Managed Fund Services Inc.
Xxx Xxxxx Xxxxxx Xxxxx
00xx Xxxxx
Xxxxxxx, XX 00000
(the "Aspect Series")
and
UBS Managed Futures (Aspect) LLC
c/o UBS Managed Fund Services Inc.
Xxx Xxxxx Xxxxxx Xxxxx
00xx Xxxxx
Xxxxxxx, XX 00000
(the "Aspect Trading Fund")
and UBS Managed Fund Services Inc. with respect to
each series of limited liability company
interest issued by UBS Managed Futures LLC
that is listed on Exhibit 1, that is made a party to
this Agreement (each such series, including
the Aspect Series, a "Series").
and UBS Managed Fund Services Inc. with respect to
each trading vehicle into which a Series
invests substantially all of its assets that
is listed on Exhibit 2, that is made a party
to this Agreement (each such entity, including
the Aspect Trading Fund, a "Trading Fund").
RECITALS
A. DPMM is engaged in the financial and investment accounting,
back office service and administration businesses.
B. The Series and each Trading Fund (each Series and the Trading
Fund into which such Series invests, a "Fund," collectively the "Funds")
each desire to engage DPMM to provide certain financial and investment
accounting and back office services
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to, and to act as the Administrator of, the respective Fund and DPMM
agrees to provide such services to, and act as Administrator of, each
Fund on the terms and conditions set forth herein.
C. UBS Managed Fund Services Inc., a Delaware corporation (the
"Sponsor") serves as the sponsor and commodity pool operator of each
Fund.
D. Each Fund intends to conduct trading activities at the
direction of a Trading Advisor (as defined below) pursuant to the
strategy described in the Prospectus of the Funds (as defined below).
NOW, THEREFORE, in consideration of the mutual promises contained
herein, and other good and valuable consideration, the receipt and
sufficiency of which the parties hereby acknowledge, the parties agree
as follows:
1. Definitions. The terms defined in the Prospectus of the Funds
will have the same meaning in this Agreement, unless otherwise defined
herein.
"Auditors" means the independent auditors of the Funds.
"Business Day" means a day on which the New York Stock Exchange
and banks in the United States are all open for business.
"Prospectus" means the current confidential offering memorandum,
private placement memorandum, prospectus or other offering document
utilized by the Funds.
"Securities" means the relevant units of limited liability company
interest or other class of securities issued by the Series from time to
time.
"Series" means the relevant series of limited liability company
interest issued by UBS Managed Futures LLC from time to time that has
been admitted to this Agreement.
"Trading Advisor" means the trading advisor(s) of each Trading
Fund, as applicable.
"Trading Fund" means a trading vehicle into which a Series invests
substantially all of its assets that has been admitted to this
Agreement.
2. Services of DPMM. Each Fund hereby authorize DPMM, its
affiliates and/or its agents to perform, and DPMM hereby agrees to
perform, or otherwise provide, the services herein enumerated in
Schedule A (the "Activities").
3. Verification. The parties acknowledge that DPMM will utilize
valuations provided by brokers and/or recognized price data vendors such
as Bloomberg or Reuters with respect to instruments that are traded on a
public exchange or that are widely traded and reported by such price
data vendors in preparing reports pursuant to Section 2 above.
Notwithstanding any other provision in this Agreement,
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the parties acknowledge that DPMM in the performance of the Activities
will rely on the valuations provided by the Funds, the Sponsor and/or
the Trading Advisor(s) (with supporting documentation) for instruments
which are not traded on a public exchange or reported by recognized
price data vendors and will not independently verify the value of such
instruments.
4. Broker Services. DPMM will not perform the services of a
trading broker, including, without limitation, executions of
transactions, payment of brokerage commissions, confirmations of
transactions to the Funds, transmittal of monthly brokerage account
statements to the Funds, enforcement of any margin requirements, or the
custody of funds or securities.
5. Compliance Services. DPMM and each Fund individually recognize
and acknowledge that DPMM's services pursuant to this Agreement are
solely limited to performance of the Activities. Unless specifically
provided under this Agreement, nothing contained herein, expressed or
implied, is intended or shall be construed to confer upon DPMM any duty
to ensure that the Funds, the Sponsor, the Trading Advisors or their
affiliated entities are acting in compliance with any applicable
domestic or international laws or regulations.
6. Sole Responsibility for the Activities. So long as this
Agreement shall remain in effect, the Funds will not authorize any other
party to perform the Activities.
7. Authorization for DPMM Communications. Each Fund hereby
authorizes DPMM to communicate, as required, with such Fund's Trading
Advisor, advisors, brokers, futures commission merchants, accountants
and/or other agents and related parties of such Fund to obtain the
information needed to perform the Activities.
8. Compensation. As compensation for performance of the Activities
pursuant to this Agreement, the Funds will collectively pay DPMM the
fees described in Schedule B. Compensation due to DPMM will be paid in
US dollars ("US$") and is subject to the minimum amounts specified in
Schedule B.
9. Payment Schedule. DPMM's entitlement to compensation will begin
on the day it begins to perform any of the Activities. If DPMM provides
services for any partial month, DPMM's monthly fee for that month will
be pro-rated in proportion to the number of days in the month for which
DPMM provides its services. DPMM will send the Funds an invoice showing
all fees due for each month within 10 days after the first day of that
month. The Funds will pay the fees within 10 days of receipt of the
invoice.
10. Special Projects. The parties hereto may agree that DPMM shall
undertake to perform additional tasks or projects upon terms and
conditions, including compensation, to be mutually agreed upon by the
parties.
11. Each Fund's Representations. Each Fund (solely with respect to
itself) represents to DPMM that:
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A. It is duly organized and validly existing and in good standing
under the laws of the jurisdiction of its formation and the Fund and the
Sponsor are in good standing and qualified to do business in each
jurisdiction in which the nature or conduct of its business requires
such qualification.
B. The Fund has full authority and power to execute, deliver,
consummate and perform this Agreement on its own behalf and that the
individual executing this Agreement on its behalf has the requisite
authority to bind the Fund to this Agreement, and the Fund has all
necessary registrations, licenses and/or memberships necessary to
conduct the activities as described in its offering document and
Prospectus provided to DPMM, as such may be amended from time to time.
C. The performance by the Fund of its obligations under this
Agreement will not conflict with or result in a breach of any of the
terms or provisions of any agreement of which the Fund is party to or to
which it is bound, and does not violate any applicable laws, rules or
regulations.
D. The Fund's Trading Advisor and Sponsor are knowledgeable about
securities and/or commodities trading, as applicable, and aware of the
risk of substantial loss in such trading.
E. The Fund will ensure that DPMM has full access to its Sponsor,
Trading Advisor(s) (to the extent permitted under any agreement among
such Fund, its Trading Advisor and the Sponsor), advisors, brokers,
accountants, and its other agents, and related parties of any of them,
in order to obtain the information DPMM will need to perform the
Activities.
F. All the information relating to the Fund given to DPMM in
connection with the transactions contemplated by this Agreement is full,
complete and accurate and DPMM may reasonably rely on such information
until it receives written notice from the Fund of any changes.
G. The Fund will immediately notify DPMM if any of the foregoing
representations ceases to be true.
12. DPMM Representations. DPMM represents to the Funds that:
A. DPMM is duly organized and validly existing as a limited
liability company under the laws of Delaware and is in good standing and
qualified to do business in each jurisdiction in which the nature or
conduct of its business requires such qualification.
B. DPMM has full authority and power to execute, deliver,
consummate and perform this Agreement and that the individual(s)
executing this Agreement on its behalf has the requisite authority to
bind DPMM to this Agreement, and DPMM has all
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necessary registrations, licenses and/or memberships necessary to
conduct the Activities.
C. The performance by DPMM of its obligations under this Agreement
will not conflict with or result in a breach of any of the terms or
provisions of any agreement of which DPMM is a party or to which it is
bound and does not violate any applicable laws, rules or regulations.
D. DPMM has completed, obtained and performed all registrations,
filings, approvals, authorizations, consents and/or examinations
required by any government or governmental authority to perform the
Activities contemplated by this Agreement and will maintain the same in
effect for so long as this Agreement remains in effect.
E. DPMM will immediately notify the Funds if any of the foregoing
representations cease to be true.
13. Non-Exclusive Services. DPMM's services are not exclusive and
DPMM and its affiliates shall be free to render similar and other
services to others.
14. Relationship of the Parties. DPMM shall at no time retain
possession of, or have any right, title and interest in the assets of
any Fund and shall not, in any way, act as a guarantor of any
Securities. DPMM is an independent contractor and this Agreement does
not establish a joint venture or partnership between DPMM and any Fund,
nor authorize any entity to act as general agent, or to enter into any
contract or other agreement on behalf of any other party except as
specifically provided herein.
15. Term. The term of this Agreement shall begin as of the date
set forth above and end October 30, 2007, unless terminated on 90 days
prior written notice by either party hereto. Termination shall not
affect DPMM's right to compensation earned prior to the date of
termination pro rata. Unless terminated earlier pursuant to this Section
15, this Agreement will renew itself for successive one-year terms,
subject to renegotiation of the terms of compensation and Activities
stated in Schedules A and B. This Agreement may be terminated
immediately upon written notice to a party for "cause." For this purpose
"cause" shall be defined and limited to acts of gross negligence,
willful misconduct or fraud by a party that has caused material adverse
consequences to the other party, as determined by independent legal
counsel selected by mutual agreement of the Sponsor and DPMM in a
written opinion that such standard for "cause" set forth above has been
met.
16. Notices. Any communication, notice or demand pursuant to this
Agreement shall be in writing and delivered by personal service
(including express or courier service) registered or certified mail,
electronic mail or facsimile with return receipt requested, as follows:
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If to DPMM:
DPM Mellon, LLC
000 Xxxxxx Xxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxxx X. Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: Xxxxx.X@xxxxxxxxx.xxx
If to the Funds:
c/o UBS Managed Fund Services Inc.
Xxx Xxxxx Xxxxxx Xxxxx
00xx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx XxXxxxxx
Telephone: (000) 000-0000
Email: xxxxx.xxxxxxxx@xxx.xxx
17. Confidentiality. DPMM and each Fund agree to keep confidential
the terms of this Agreement and each transaction hereunder, and all
related agreements, business practices, financial data, procedures and
policies hereunder or otherwise relating to either of them or their
affiliates that are not publicly available (the "Confidential
Information"). The parties shall keep the Confidential Information in
strictest confidence except to perform the services as contemplated by
this Agreement, as necessary to inform parties who "need to know" such
information in the performance of their duties or as required by
applicable law or regulation. The obligations of the parties pursuant to
this section shall survive termination of this Agreement.
18. Indemnification. DPMM agrees to indemnify and hold harmless
each Fund and its officers, directors and employees and respective
successors and permitted assigns from and against any and all
liabilities, claims, costs, fines, damages, expenses, losses and
attorneys' fees arising out of any act or any failure to act by DPMM,
its affiliates, and their respective officers and employees, and their
respective successors and permitted assigns that constitutes fraud,
negligence, or willful misconduct. Each Fund, severally and not jointly,
agrees to indemnify and hold harmless DPMM and its respective officers
and employees and their respective successors and permitted assigns from
and against any and all liabilities, claims, costs, fines, damages,
expenses, losses or pursuant to this Agreement, provided that such
liability was not the result of fraud, negligence, or willful misconduct
by DPMM, its officers, directors and employees and
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respective successors and permitted assigns. In no event shall any party
to this Agreement be liable to other parties for any special, indirect,
incidental or consequential damages of any kind. The obligations of the
parties pursuant to this section shall survive termination of this
Agreement.
19. Anti-Money Laundering. DPMM represents, acknowledges and
warrants to each of the Funds as follows:
A. DPMM has established anti-money laundering policies and
procedures designed to comply with applicable laws, rules and
regulations of the United States, including without limitation
applicable rules promulgated under the Uniting and Strengthening America
by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001.
B. DPMM intends to update or amend its anti-money laundering
policies and procedures as may be necessary in order to comply with
applicable laws, rules and regulations as such are amended or adopted
from time to time.
C. DPMM represents that it is properly enforcing its anti-money
laundering policies and procedures and will provide such annual
re-certification of the same, upon request by any Fund or a Trading
Advisor.
D. To the extent any Fund or the Sponsor seek to have DPMM provide
services related to anti-money laundering in addition to those specified
herein or on Schedule A, the nature of such additional services and the
compensation related thereto will be handled on a negotiated basis and
agreed upon by the parties in writing.
20. Books and Records.
A. Each Fund, with respect to its own records, and the Sponsor,
with respect to the records of all Funds, shall have the right to
inspect the Fund records maintained at DPMM. Except as otherwise
authorized by the Sponsor, all such records (other than those which are
not of a material nature) shall be preserved by DPMM for a period of six
(6) years.
B. If DPMM receives any request or demand for the inspection of
any records of the Funds, DPMM will endeavor to notify the applicable
Fund and/or the Sponsor to secure instructions from such Fund or the
Sponsor as to such inspection.
C. In the event of termination of this Agreement, upon and subject
to payment of any outstanding amounts due to DPMM under this Agreement,
DPMM shall deliver to each Fund or its designated agent all of the
books, documents and records of such Fund in the possession, or under
the control, of DPMM.
21. Employment Practices. Each Fund and the Sponsor agree that
they shall not hire or solicit the employment of, or services from, any
employee of DPMM or its
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affiliates unless approved in advance by DPMM or until a minimum period
of three (3) months has passed from the employee's last day of
employment with DPMM.
22. Governing Law. This Agreement and performance hereunder and
all suits and special proceedings hereunder shall be construed in
accordance with the laws of the State of New Jersey.
23. Amendment. This Agreement contains the sole and entire
agreement between the parties and supersedes any and all other
agreements between the parties relating to the subject matter hereof. A
modification of this Agreement will be effective only if it is in
writing and signed by both parties. A new Trading Fund and/or Series may
become a party to this Agreement upon the execution of a form of
adhesion (a sample of which is attached hereto as Exhibit 3) to be bound
by this Agreement that is executed by the Sponsor, DPMM and the
respective Trading Fund and/or Series. Each such Trading Fund and/or
Series will be listed on Exhibit A and such executed form of adhesion
will be added as an Appendix to and made part of this Agreement.
24. Assignability. This Agreement shall be binding on and inure to
the benefit of the respective parties hereto and their heirs, executors,
successors and assigns. No party shall assign the rights or delegate the
duties pursuant to this Agreement without the prior written consent of
the other parties, except as may be permitted under Section J of
Schedule A. In addition, upon written notice but without consent of the
Funds or the Sponsor, DPMM may assign this Agreement to any direct or
indirect majority-owned subsidiary of Mellon Financial Corporation.
25. Force Majeure. Notwithstanding anything in this Agreement to
the contrary, DPMM shall not be responsible or liable for its failure to
perform under this Agreement or for any losses to any Fund resulting
from any event beyond the reasonable control of DPMM, its parent or
affiliates or any of its officers, directors, employees,
representatives, agents or permitted assigns. This provision shall
survive the termination of this Agreement.
26. Waiver. The waiver by any party of a breach of any provisions
of this Agreement shall not operate or be construed as a waiver of any
subsequent breach by either party. The failure of a party to insist upon
strict adherence to any provision of the Agreement shall not constitute
a waiver or thereafter deprive such party of the right to insist upon
strict adherence.
27. Severability. If any provision of this Agreement shall be held
or made invalid by statute, rule, regulation, decision of a tribunal or
otherwise, the remainder of this Agreement shall not be affected thereby
and, to this extent, the provisions of this Agreement shall be deemed to
be severable in the jurisdiction which so determines.
28. Counterparts; Facsimile; Electronic Transmission. This
Agreement may be executed in any number of counterparts, each of which
is deemed an original and all of which together evidence the entire
Agreement. Signatures on this Agreement may be
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communicated by facsimile or electronic mail transmission and shall be
binding upon the parties so transmitting their signatures.
29. Survival. In addition to those provisions which specifically
provide for survival beyond expiration and termination (such as
liability and indemnification, confidentiality, and force majeure), all
provisions relating to payment shall survive until completion of
required payments.
30. Each Series a Separate Legal Entity. The Series are legally
segregated from each other such that under Delaware law one Series is
not liable for the obligations of any other Series. Each reference to a
Series or Fund in this Agreement shall reference such Series separately
and in no way shall be construed so as to implicate that a Series will
be liable for any obligation (including, but not limited to, the
obligations set forth in Section 18) of any other Series or that UBS
Managed Futures LLC shall be liable for any such obligations.
[The remainder of this page is intentionally left blank.]
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IN WITNESS WHEREOF, the parties have set their hands and seals on the
day first written above.
Witness: UBS Managed Futures LLC (Aspect Series)
/s/ Xxxx Xxxxx By: /s/ X. Xxxxx
----------------------------- -----------------------------
Xxxx Xxxxx X. Xxxxx, Director
Director -----------------------------
Print Name and Title
Witness: UBS Managed Futures Aspect) LLC
/s/ Xxxx Xxxxx By: /s/ X. Xxxxx
-------------------------- -----------------------------
Xxxx Xxxxx X. Xxxxx, Director
Director -----------------------------
Print Name and Title
UBS Managed Fund Services Inc.,
with respect to and for purposes of
Section 23 of this Agreement
/s/ Xxxx Xxxxx By: /s/ X. Xxxxx
-------------------------- -----------------------------
Xxxx Xxxxx X. Xxxxx, Director
Director -----------------------------
Print Name and Title
Witness: DPM Mellon, LLC
/s/ Xxxxxxx Opteusue By: /s/ Xxx Xxxxxxxxxx
-------------------- -------------------------------------
Xxxxxxx Opteusue Xxx Xxxxxxxxxx, President, DPM Mellon
Director -------------------------------------
Print Name and Title
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Schedule A
A) Obtain performance data from each Fund, the Sponsor, the Trading
Advisor and/or brokers, to the extent made available to DPMM, in order to
accurately compute and generate the following reports: daily activity reports;
portfolio reports; portfolio summary reports; summary reports; trade
confirmations; day trade; realized profit and loss, and indicative net asset
value reports; and such other daily reports or applications as may be agreed
to by DPMM and the Sponsor from time to time. DPMM will distribute such daily
reports electronically to the Sponsor within one (1) Business Day after a
relevant trade date.
B) Compile and prepare monthly reports of realized and unrealized
gain/loss, accrued dividends and interest analysis; calculate and publish
monthly net asset value of the of each Fund; prepare monthly purchase-sales
journal, dividends and interest journal; prepare monthly balance sheets;
changes in equity and income statements; prepare a monthly general ledger
accompanied by appropriate documentation with detailed fee schedules
(including the calculation of advisory fees and performance fees payable to
the Trading Advisors and the Sponsor, and compensation payable to DPMM
hereunder), in accordance with generally accepted accounting principles (a
"General Ledger"); provide the Sponsor with monthly balance sheets. DPMM will
provide such final monthly reports to the Sponsor with fifteen (15) Business
Days after the end of each month.
C) Maintain the financial books and records of each Fund, including
brokers statements and trading advisor reports, to the extent such information
is made available and provided to DPMM.
D) Process subscriptions and redemptions of each Fund in compliance with
applicable anti-money laundering regulations the United States. Prior to
processing a subscription, DPMM will verify that the relevant subscriber's
name does not appear on the List of Specially Designated Nationals and Blocked
Persons maintained by the U.S. Office of Foreign Assets Control.
E) Provide or arrange for registrar and transfer agent services in
connection with the issuance, transfer and redemption of Securities in
accordance with the terms of the relevant Prospectus or as otherwise approved
by the Sponsor and DPMM. Maintain appropriate investor information in
connection with subscription applications and redemptions.
F) Disseminate quotations of the net asset value of each Fund and the
Securities, as may be reasonably requested by the Sponsor.
G) Perform or arrange for treasury functions consisting of the (i)
preparation of accounts payable; (ii) signing and distribution of corporate
checks; (iii) preparation and delivery of bank deposit forms; (iv) wire
transfer of funds as requested by any
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Fund; (v) confirmation of income receipts; and (vi) coordinating with each
Fund as to the opening of bank accounts for the subscription assets of such
Fund.
H) Deal with and answer correspondence from or on behalf of the
subscribers in each Fund relating to the function of the Administrator under
this Agreement.
I) Have power to pay out of the assets and/or accounts of each Fund such
amounts as may be required from time to time by it in order to enable it to
perform its duties under this Agreement and for these purposes to draw on the
bank accounts of each Fund.
J) DPMM may, at its own expense and without charge to any Fund, employ
servants or agents in performance of its duties and the exercise of its rights
under this Agreement, without prior notice to the applicable Fund; however, if
any such arrangement results in the fees being charged to any Fund in addition
to the fees stated herein or in Schedule A, the prior written consent of the
Sponsor will be required before such arrangements can be made by DPMM.
K) Assist and provide information to the Auditors in connection with
their preparation of the annual audited financial report of each Fund and any
income tax returns or relevant explanatory materials for investors.
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Schedule B
Pricing Schedule
The DPMM pricing model is based on several factors such as total assets in the
aggregate portfolios of the Funds under administration of DPMM and the number
of General Ledgers. For its performance of administrative services, DPMM will
receive a monthly administrative fee as to be determined by the Funds and DPMM
up to 0.0167 of 1% of each Fund's month-end Net Asset Value (a 0.20% annual
rate), subject to a monthly minimum of $10,000.
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Exhibit 1
List of Series
Series:
1. UBS Managed Futures LLC (Aspect Series)
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Exhibit 2
List of Trading Funds
Trading Funds:
1. UBS Managed Futures (Aspect) LLC
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Exhibit 3
APPENDIX NO. [ ] TO THE ADMINISTRATION AGREEMENT
Dear Sir or Madam,
Pursuant to Section 23 of the Administration Agreement initially entered into
on October 30, 2006 (the "Administration Agreement") by and among DPM Mellon,
LLC, UBS Managed Futures LLC (Aspect Series), UBS Managed Futures (Aspect) LLC
and UBS Managed Fund Services Inc., as amended, the undersigned Trading Fund
and/or Series, as the case may be, agrees to be bound by the terms and
conditions of the Administration Agreement and to be reflected as being a
Trading Fund and/or Series, as the case may be, for purposes of the
Administration Agreement, with effect as of ________, 20__.
Each of the undersigned agrees to be bound by the terms and conditions of the
Administration Agreement, as amended.
IN WITNESS WHEREOF, the parties have set their hands and seals on the day
first written above.
Witness: UBS Managed Fund Services Inc.
_____________________________ By: _____________________________
_____________________________
Print Name and Title
Witness: [Name of Trading Fund]
_____________________________ By: ______________________________
_____________________________
Print Name and Title
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Witness: [Name of Series]
_____________________________ By: _____________________________
_____________________________
Print Name and Title
Witness: DPM Mellon, LLC
_____________________________ By: _____________________________
_____________________________
Print Name and Title
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