FORM OF ADMINISTRATION AGREEMENT]
Exhibit K.1
[FORM OF ADMINISTRATION AGREEMENT]
This Agreement (“Agreement”) is made as of , 2007 by and between IRON LEAF CAPITAL
CORPORATION a Maryland limited liability company (the “Corporation”), and IRON LEAF ADMINISTRATOR,
LLC, a Delaware limited liability company (the “Administrator”).
W I T N E S S E T H:
WHEREAS, the Corporation is a newly organized closed-end management investment fund that
intends to elect to be treated as a business development company (“BDC”) under the Investment
Company Act of 1940, as amended (the “Investment Company Act”);
WHEREAS, the Corporation desires to retain the Administrator to provide administrative
services to the Corporation in the manner and on the terms hereinafter set forth;
WHEREAS, the Administrator is willing to provide administrative services to the Corporation on
the terms and conditions hereafter set forth.
NOW, THEREFORE, in consideration of the premises and the covenants hereinafter contained and
for other good and valuable consideration, the receipt and adequacy of which is hereby
acknowledged, the Corporation and the Administrator hereby agree as follows:
1. Duties of the Administrator
(a) Employment of Administrator. The Corporation hereby employs the Administrator to
act as administrator of the Corporation, and to furnish, or arrange for others to furnish, the
administrative services, personnel and facilities described below, subject to review by and the
overall control of the Board of Directors of the Corporation, for the period and on the terms and
conditions set forth in this Agreement. The Administrator hereby accepts such employment and agrees
during such period to render, or arrange for the rendering of, such services and to assume the
obligations herein set forth subject to the reimbursement of costs and expenses provided for below.
The Administrator and such others shall for all purposes herein be deemed to be independent
contractors and shall, unless otherwise expressly provided or authorized herein, have no authority
to act for or represent the Corporation in any way or otherwise be deemed agents of the
Corporation.
(b) Services. The Administrator shall perform (or oversee, or arrange for, the
performance of) the administrative services necessary for the operation of the Corporation. Without
limiting the generality of the foregoing, to the extent the Corporation so requires the
Administrator shall provide the Corporation with office facilities, equipment, clerical,
bookkeeping and record keeping services at such facilities and such other services as the
Administrator, subject to review by the Board of Directors of the Corporation, shall from time to
time determine to be necessary or useful to perform its obligations under this Agreement. The
Administrator shall also, on behalf of the Corporation, conduct relations with custodians,
depositories, transfer agents, dividend disbursing agents, other stockholder servicing agents,
accountants, attorneys, underwriters, brokers and dealers, corporate fiduciaries, insurers, banks
and such other persons in any such other capacity deemed to be necessary or desirable. The
Administrator shall make reports to the Board of Directors of the Corporation of its performance of
obligations hereunder and furnish advice and recommendations with respect to such other aspects of
the business and affairs of the Corporation as it shall determine to be desirable; provided that
nothing herein shall be construed to require the Administrator to, and the Administrator shall not,
provide any advice or recommendation relating to the securities and other assets that the
Corporation should purchase, retain or sell or any other investment advisory services to the
Corporation. Subject to review by and the overall control of the Board of Directors of the
Corporation, the Administrator shall be responsible for the financial and other records that the
Corporation is required to maintain and shall prepare, print and disseminate reports to
stockholders, and reports and other materials filed with the Securities and Exchange Commission
(the “SEC”). In addition, subject to review by and the overall control of the Board of Directors
of the Corporation, the Administrator will assist the Corporation in determining and publishing the
Corporation’s net asset value, overseeing the preparation and filing of the Corporation’s tax
returns, and generally overseeing the payment of the Corporation’s expenses and the performance of
administrative and professional services rendered to the Corporation by others.
2. Records
Subject to review by and the overall control of the Board of Directors of the Corporation, the
Administrator agrees to maintain and keep all books, accounts and other records of the Corporation
that relate to activities performed by the Administrator hereunder and will maintain and keep such
books, accounts and records in accordance with the Investment Company Act. In compliance with the
requirements of Rule 31a-3 under the Investment Company Act, the Administrator agrees that all
records which it maintains for the Corporation shall at all times remain the property of the
Corporation, shall be readily accessible during normal business hours, and shall be promptly
surrendered upon the termination of the Agreement or otherwise on written request. The
Administrator further agrees that all records which it maintains for the Corporation pursuant to
Rule 31a-1 under the Investment Company Act will be preserved for the periods prescribed by Rule
31a-2 under the Investment Company Act unless any such records are earlier surrendered as provided
above. Records shall be surrendered in usable machine-readable form. The Administrator shall have
the right to retain copies of such records subject to observance of its confidentiality obligations
under this Agreement.
3. Confidentiality
The parties hereto agree that each shall treat confidentially the terms and conditions of this
Agreement and all information provided by each party to the other regarding its business and
operations. All confidential information provided by a party hereto, including nonpublic personal
information (regulated pursuant to Regulation S-P of the SEC), shall be used by any other party
hereto solely for the purpose of rendering services pursuant to this Agreement and, except as may
be required in carrying out this Agreement, shall not be disclosed to any third party, without the
prior consent of such providing party. The foregoing shall not be applicable to any information
that is publicly available when provided or thereafter becomes publicly available other than
through a breach of this Agreement, or that is required to be disclosed by any
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regulatory authority, any authority or legal counsel of the parties hereto, by judicial or
administrative process or otherwise by applicable law or regulation.
4. Compensation; Allocation of Costs and Expenses
In full consideration of the provision of the services of the Administrator, the Corporation
shall reimburse the Administrator for the costs and expenses incurred by the Administrator in
performing its obligations and providing personnel and facilities hereunder. The Corporation will
bear all costs and expenses that are incurred in its operation, administration and transactions and
not specifically assumed by the Adviser, pursuant to that certain Investment Advisory Agreement,
dated as of , 2007 by and between the Corporation and the Adviser. Costs and expenses to
be borne by the Corporation include, but are not limited to, those relating to: organization and
offering; calculating the Corporation’s net asset value (including the cost and expenses of any
independent valuation firm); expenses incurred by the Adviser payable to third parties, including
agents, consultants or other advisors, in monitoring financial and legal affairs for the
Corporation and in providing administrative services, monitoring the Corporation’s investments and
performing due diligence on its prospective portfolio companies; interest payable on debt, if any,
incurred to finance the Corporation’s investments; sales and purchases of the Corporation’s common
stock and other securities; investment advisory and management fees; administration fees, if any,
payable under this Agreement; fees payable to third parties, including agents, consultants or other
advisors, relating to, or associated with, evaluating and making investments; transfer agent and
custodial fees; federal and state registration fees; all costs of registration and listing the
Corporation’s shares on any securities exchange; federal, state and local taxes; independent
Directors’ fees and expenses; costs of preparing and filing reports or other documents required by
the SEC; costs of any reports, proxy statements or other notices to stockholders, including
printing costs; fidelity bond, directors and officers/errors and omissions liability insurance, and
any other insurance premiums; direct costs and expenses of administration, including printing,
mailing, long distance telephone, copying, secretarial and other staff, independent auditors and
outside legal costs; and all other expenses incurred by the Corporation or the Administrator in
connection with administering the Corporation’s business, including payments under this Agreement
based upon the Corporation’s allocable portion of the Administrator’s overhead in performing its
obligations under the Administration Agreement, including rent and the allocable portion of the
cost of the Corporation’s chief compliance officer and chief financial officer and their respective
staffs.
5. Limitation of Liability of the Administrator; Indemnification
The Administrator (and its officers, managers, partners, agents, employees, controlling
persons, members (or their owners), and any other person or entity affiliated with the
Administrator, including without limitation its members, and any person affiliated with its members
to the extent they are providing services for or otherwise acting on behalf of the Administrator,
Adviser or the Corporation) shall not be liable to the Corporation for any action taken or omitted
to be taken by the Administrator in connection with the performance of any of its duties or
obligations under this Agreement or otherwise as administrator for the Corporation, and the
Corporation shall indemnify, defend and protect the Administrator (and its officers, managers,
partners, agents, employees, controlling persons, members (or their owners), and any other person
or entity affiliated with the Administrator, including without limitation the Adviser,
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each of whom shall be deemed a third party beneficiary hereof) (collectively, the “Indemnified
Parties”) and hold them harmless from and against all damages, liabilities, costs and expenses
(including reasonable attorneys’ fees and amounts reasonably paid in settlement) incurred by the
Indemnified Parties in or by reason of any pending, threatened or completed action, suit,
investigation or other proceeding (including an action or suit by or in the right of the
Corporation or its security holders) arising out of or otherwise based upon the performance of any
of the Administrator’s duties or obligations under this Agreement or otherwise as administrator for
the Corporation. Notwithstanding the preceding sentence of this Section 5 to the contrary, nothing
contained herein shall protect or be deemed to protect the Indemnified Parties against or entitle
or be deemed to entitle the Indemnified Parties to indemnification in respect of, any liability to
the Corporation or its security holders to which the Indemnified Parties would otherwise be subject
by reason of willful misfeasance, bad faith or gross negligence in the performance of the
Administrator’s duties or by reason of the reckless disregard of the Administrator’s duties and
obligations under this Agreement (to the extent applicable, as the same shall be determined in
accordance with the Investment Company Act and any interpretations or guidance by the SEC or its
staff thereunder). The provisions of this Section 5 shall remain in full force and effect, and the
Indemnified Parties shall remain entitled to the benefits thereof, notwithstanding any termination
of this Agreement.
6. Activities of the Administrator
The services of the Administrator to the Corporation are not to be deemed to be exclusive, and
the Administrator and each of its affiliates is free to render services to others. It is understood
that directors, officers, employees and stockholders of the Corporation are or may become
interested in the Administrator and its affiliates, as directors, officers, members, managers,
employees, partners, stockholders or otherwise, and that the Administrator and Directors, officers,
members, managers, employees, partners and stockholders of the Administrator and its affiliates are
or may become similarly interested in the Corporation as stockholders or otherwise. If any person
who is a manager, partner, member, officer or employee of the Adviser or the Administrator is or
becomes a director, officer and/or employee of the Corporation and acts as such in any business of
the Corporation, then such manager, partner, member, officer and/or employee of the Adviser or the
Administrator shall be deemed to be acting in such capacity solely for the Corporation, and not as
a manager, partner, member, officer or employee of the Adviser or the Administrator or under the
control or direction of the Adviser or the Administrator, even if paid by the Adviser or the
Administrator.
7. Duration and Termination of this Agreement
(a) This Agreement shall become effective as of the first date above written. This Agreement
may be terminated at any time, without the payment of any penalty, upon not more than 60 days’
written notice, by the vote of a majority of the outstanding voting securities of the Corporation
or by the vote of the Corporation’s Board of Directors or by the Administrator.
(b) This Agreement shall continue in effect for two years from the date hereof, and thereafter
shall continue automatically for successive annual periods, provided that such continuance is
specifically approved at least annually by (A) the vote of the Corporation’s
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Board of Directors, or by the vote of a majority of the outstanding voting securities of the
Corporation and (B) the vote of a majority of the Corporation’s Directors who are not parties to
this Agreement or “interested persons” (as such term is defined in Section 2(a)(19) of the
Investment Company Act) of any such party, in accordance with the requirements of the Investment
Company Act;
(c) This Agreement may not be assigned by a party without the consent of the other party;
provided, however, that the rights and obligations of the Corporation under this
Agreement shall not be deemed to be assigned to a newly-formed entity in the event of the merger of
the Corporation into, or conveyance of all of the assets of the Corporation to, such newly-formed
entity; provided, further, however, that the sole purpose of that merger or
conveyance is to effect a mere change in the Corporation’s legal form into another limited
liability entity. The provisions of Section 5 of this Agreement shall remain in full force and
effect, and the Administrator shall remain entitled to the benefits thereof, notwithstanding any
termination of this Agreement.
8. Amendments of this Agreement
This Agreement may be amended pursuant to a written instrument by mutual consent of the
parties.
9. Governing Law
Notwithstanding the place where this Agreement may be executed by any of the parties hereto,
this Agreement shall be construed in accordance with the laws of the State of New York and shall be
construed in accordance with the applicable provisions of the Investment Company Act. To the extent
the applicable laws of the State of New York, or any of the provisions herein, conflict with the
provisions of the Investment Company Act, the latter shall control. To the fullest extent
permitted by law, in the event of any dispute arising out of the terms and conditions of this
Agreement, the parties hereto consent and submit to the jurisdiction of the courts of the State of
New York in the county of New York and of the U.S. District Court for the Southern District of New
York.
10. Entire Agreement
This Agreement contains the entire agreement of the parties and supercedes all prior
agreements, understandings and arrangements with respect to the subject matter hereof.
11. Notices
Any notice under this Agreement shall be given in writing, addressed and delivered or mailed,
postage prepaid, to the other party at its principal office.
Remainder of Page Intentionally Left Blank
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement as of the
date first above written.
| IRON LEAF CAPITAL CORPORATION |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| IRON LEAF ADMINISTRATORS, LLC |
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| By: | ||||
| Name: | ||||
| Title: | ||||
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