SCS Hedged Opportunities Master Fund, LLC LIMITED LIABILITY COMPANY AGREEMENT April [ ], 2010
April
[ ], 2010
TABLE OF
CONTENTS
|
ARTICLE
I
|
1
|
|||
|
ARTICLE
II
|
4
|
|||
|
2.1
|
Formation
of Limited Liability Company
|
4
|
||
|
2.2
|
Name
|
5
|
||
|
2.3
|
Principal
and Registered Office
|
5
|
||
|
2.4
|
Duration
|
5
|
||
|
2.5
|
Business
of the Fund
|
5
|
||
|
2.6
|
The
Board
|
5
|
||
|
2.7
|
Members
|
6
|
||
|
2.8
|
Organizational
Member
|
7
|
||
|
2.9
|
Both
Directors and Members
|
7
|
||
|
2.10
|
Limited
Liability
|
7
|
||
|
ARTICLE
III
|
7
|
|||
|
3.1
|
Management
and Control
|
7
|
||
|
3.2
|
Actions
by the Board
|
8
|
||
|
3.3
|
Officers
|
9
|
||
|
3.4
|
Meetings
of Members
|
9
|
||
|
3.5
|
Custody
of Assets of the Fund
|
10
|
||
|
3.6
|
Other
Activities of Members, Directors and the Adviser
|
10
|
||
|
3.7
|
Duty
of Care
|
11
|
||
|
3.8
|
Indemnification
|
11
|
||
|
3.9
|
Fees,
Expenses and Reimbursement
|
13
|
||
|
3.10
|
Liabilities
and Duties
|
14
|
||
|
ARTICLE
IV
|
15
|
|||
|
4.1
|
Termination
of Status of the Adviser
|
15
|
||
|
4.2
|
Termination
of Status of a Director
|
15
|
||
|
4.3
|
Removal
of the Directors
|
15
|
||
|
4.4
|
Transfer
of Interests of Members
|
15
|
||
|
4.5
|
Repurchase
of Interests
|
16
|
||
|
ARTICLE
V
|
17
|
|||
|
5.1
|
Contributions
to Capital
|
17
|
||
|
5.2
|
Rights
of Members to Capital
|
18
|
||
|
5.3
|
Capital
Accounts
|
18
|
||
|
5.4
|
Allocation
of Net Profit and Loss
|
19
|
||
|
5.5
|
Allocation
of Certain Withholding Taxes and Other Expenditures
|
19
|
||
|
5.6
|
Reserves
|
19
|
||
|
5.7
|
Tax
Allocations
|
20
|
||
|
5.8
|
Distributions
|
21
|
||
- i
-
|
ARTICLE
VI
|
21
|
|||
|
6.1
|
Dissolution
|
21
|
||
|
6.2
|
Liquidation
of Assets
|
22
|
||
|
ARTICLE
VII
|
23
|
|||
|
7.1
|
Accounting
and Reports
|
23
|
||
|
7.2
|
Determinations
By the Board
|
23
|
||
|
7.3
|
Valuation
of Assets
|
24
|
||
|
ARTICLE
VIII
|
24
|
|||
|
8.1
|
Amendment
of Limited Liability Company Agreement
|
24
|
||
|
8.2
|
Notices
|
25
|
||
|
8.3
|
Agreement
Binding Upon Successors and Assigns
|
26
|
||
|
8.4
|
Applicability
of 1940 Act and Form N-2
|
26
|
||
|
8.5
|
Choice
of Law
|
26
|
||
|
8.6
|
Not
for Benefit of Creditors
|
27
|
||
|
8.7
|
Consents
|
27
|
||
|
8.8
|
Merger
and Consolidation
|
27
|
||
|
8.9
|
Pronouns
|
28
|
||
|
8.10
|
Confidentiality
|
28
|
||
|
8.11
|
Certification
of Non-Foreign Status
|
28
|
||
|
8.12
|
Severability
|
29
|
||
|
8.13
|
Entire
Agreement
|
29
|
||
|
8.14
|
Discretion
|
29
|
||
|
8.15
|
Counterparts
|
29
|
||
|
8.16
|
Tax
Matters Partner
|
29
|
||
|
8.17
|
Section
754 Election
|
30
|
||
|
8.18
|
Member
Tax Basis
|
30
|
||
-ii-
SCS
HEDGED OPPORTUNITIES MASTER FUND
THIS
LIMITED LIABILITY COMPANY AGREEMENT of SCS Hedged Opportunities Master Fund (the
“Fund”) is dated and effective as of April [___], 2010 by and among the
Organizational Member, SCS Capital Management, LLC, as Adviser, and each person
hereinafter admitted to the Fund in accordance with this Agreement and reflected
on the books of the Fund as a Member.
W I T N E
S S E T H :
WHEREAS,
the Fund heretofore has been formed as a limited liability company under the
Delaware Limited Liability Company Act, pursuant to the Certificate dated as of
[____], 2010 and filed with the Secretary of State of the State of Delaware on
[_____], 2010;
NOW,
THEREFORE, for and in consideration of the foregoing and the mutual covenants
hereinafter set forth, it is hereby agreed as follows:
ARTICLE
I
DEFINITIONS
For
purposes of this Agreement:
“1940 Act” means the Investment
Company Act of 1940 and the rules, regulations and orders thereunder, as amended
from time to time, or any successor law.
“1934 Act” means the Securities
Exchange Act of 1934 and the rules, regulations and orders thereunder, as
amended from time to time, or any successor law.
“Administrator” means the
person who provides administrative services to the Fund pursuant to an
administrative services agreement.
“Adviser” means SCS Capital
Management, LLC or any successor investment adviser to the Fund, in its capacity
as investment adviser under the Investment Advisory Agreement. [The
Adviser shall be subject to the provisions of Section 2.7(b), as a member of the
Fund.]
“Advisers Act” means the
Investment Advisers Act of 1940 and the rules, regulations and orders
thereunder, as amended from time to time, or any successor law.
“Affiliate” means affiliated
person as such term is defined in the 1940 Act.
“Agreement” means this Limited
Liability Company Agreement, as amended and/or restated from time to
time.
“Board” means the Board of
Directors established pursuant to Section 2.6 hereof.
-1-
“Capital Account” means, with
respect to each Member, the capital account established and maintained on behalf
of each Member pursuant to Section 5.3 hereof.
“Capital Contribution” means
the contribution, if any, made, or to be made, as the context requires, to the
capital of the Fund by a Member.
“Certificate” means the
Certificate of Formation of the Fund and any amendments thereto as filed with
the office of the Secretary of State of the State of Delaware.
“Closing Date” means the first
date on or as of which a Member other than the Organizational Member or the
Adviser is admitted to the Fund.
“Code” means the United States
Internal Revenue Code of 1986, as amended and as hereafter amended from time to
time, or any successor law.
“Delaware Act” means the
Delaware Limited Liability Company Act (6 Del.C. § 18-101, et seq.) as in effect on the
date hereof and as amended from time to time, or any successor law.
“Director” means each natural
person listed on Schedule I hereto who serves on the Board and any other natural
person who, from time to time, pursuant hereto shall serve on the
Board. Each Director shall constitute a “manager” of the Fund within
the meaning of the Delaware Act.
“Fiscal Period” means the
period commencing on the Closing Date, and thereafter each period commencing on
the day immediately following the last day of the preceding Fiscal Period, and
ending at the close of business on the first to occur of the following
dates:
(a) the last
day of a Fiscal Year;
(b) the day
preceding any day as of which a contribution to the capital of the Fund is made
pursuant to Section 5.1;
(c) the day
as of which the Fund makes any distribution to, or repurchases any Interest or
portion of an Interest of, any Member;
(d) the day
as of which the Fund admits a substituted Member to whom an Interest (or portion
thereof) of a Member has been Transferred (unless there is no change of
beneficial ownership); or
(e) any other
day as of which this Agreement provides for any amount to be credited to or
debited against the Capital Account of any Member, other than an amount to be
credited to or debited against the Capital Accounts of all Members in accordance
with their respective Fund Percentages.
“Fiscal Year” means
the period commencing on the Closing Date and ending on the first March 31st
following the Closing Date, and thereafter each period commencing on April
1st of
each year and ending on March 31st of
the succeeding year (or on the date of a final distribution pursuant to Section
6.2 hereof), unless the Directors shall designate another fiscal year for the
Fund.
-2-
“Form N-2” means the Fund’s
Registration Statement on Form N-2 filed with the Securities and Exchange
Commission, as amended from time to time.
“Fund” means the limited
liability company governed hereby, as such limited liability company may from
time to time be constituted.
“Fund Percentage” means a
percentage established for each Member on the Fund’s books as of the first day
of each Fiscal Period. The Fund Percentage of a Member for a Fiscal
Period shall be determined by dividing the balance of the Member’s Capital
Account as of the commencement of such Fiscal Period by the sum of the Capital
Accounts of all of the Members as of the commencement of such Fiscal
Period. The sum of the Fund Percentages of all Members for each
Fiscal Period shall equal 100%.
“Independent Directors” means
those Directors who are not “interested persons” of the Fund as such term is
defined in the 1940 Act.
“Interest” means the entire
ownership interest in the Fund at any particular time of a Member or other
person to whom an Interest or portion thereof has been transferred pursuant to
Section 4.4 hereof, including the rights and obligations of such Member or other
person under this Agreement and the Delaware Act.
“Investment Advisory Agreement”
means the investment advisory agreement entered into between the Adviser and the
Fund, as from time to time in effect.
“Investment Funds” means
unregistered pooled investment vehicles and registered investment companies into
which the Fund invests.
“Investment Managers” means
portfolio managers among which the Fund deploys some or all of its
assets.
“Member” means any person who
is admitted to the Fund in accordance with this Agreement as a member until the
Fund repurchases the entire Interest of such person pursuant to Section 4.5
hereof or such person otherwise ceases to be a member of the Fund or a
substitute Member who is admitted to the Fund pursuant to Section 4.4 hereof, in
such person’s capacity as a member of the Fund. For purposes of the
Delaware Act, the Members shall constitute a single class or group of
members.
“Net Assets” means the total
value of all assets of the Fund, less an amount equal to all accrued debts,
liabilities and obligations of the Fund, calculated before giving effect to any
repurchases of Interests.
“Net Profit” or “Net Loss” means the amount by
which the Net Assets as of the close of business on the last day of a Fiscal
Period exceed (in the case of Net Profit) or are less than (in the case of Net
Loss) the Net Assets as of the commencement of the same Fiscal Period” (or, with
respect to the initial Fiscal Period of the Fund, at the close of business on
the Closing Date), such amount to be adjusted to exclude:
-3-
(a) the
amount of any amounts to be allocated among the Capital Accounts of the Members
pursuant to Section 5.5 or 5.6 hereof; and
(b) any items
to be allocated among the Capital Accounts of the Members on a basis which is
not in accordance with the respective Fund Percentages of all Members as of the
commencement of such Fiscal Period.
“Organizational Member” means
the person executing this Agreement in such capacity.
“Person” means any individual,
entity, corporation, partnership, association, limited liability company,
joint-stock company, trust, estate, joint venture, organization or
unincorporated organization.
“Securities” means securities
(including, without limitation, equities, debt obligations, options, and other
“securities” as that term is defined in Section 2(a)(36) of the 0000 Xxx) and
any contracts for forward or future delivery of any security, debt obligation,
currency or commodity, all manner of derivative instruments and any contracts
based on any index or group of securities, debt obligations, currencies or
commodities, and any options thereon.
“Tax Matters Partner” means the
person designated as “tax matters partner” of the Fund pursuant to Section 8.17
hereof.
“Transfer” means the
assignment, transfer, sale or other disposition of all or any portion of an
Interest, including any right to receive any allocations and distributions
attributable to an Interest.
“Voting Interest” means with
respect to a Member the number of votes equivalent to such Member’s Fund
Percentage as of the record date for a meeting of Members.
ARTICLE
II
ORGANIZATION;
ADMISSION OF MEMBERS; BOARD
2.1 Formation
of Limited Liability Company.
The
Organizational Member and any persons designated by the Board hereby are
designated as authorized persons, within the meaning of the Delaware Act, to
execute, deliver and file all certificates (and any amendments and/or
restatements thereof) required or permitted by the Delaware Act to be filed in
the office of the Secretary of State of the State of Delaware. The
Board shall cause to be executed and filed with applicable governmental
authorities any other instruments, documents and certificates which, in the
opinion of the Fund’s legal counsel, may from time to time be required by the
laws of the United States of America, the State of Delaware or any other
jurisdiction in which the Fund shall determine to do business, or any political
subdivision or agency thereof, or which such legal counsel may deem necessary or
appropriate to effectuate, implement and continue the valid existence and
business of the Fund.
-4-
2.2 Name.
The name
of the Fund shall be “SCS Hedged Opportunities Master Fund, LLC” or such other
name as the Board hereafter may adopt upon causing an appropriate amendment to
this Agreement to be adopted and to the Certificate to be filed in accordance
with the Delaware Act. The Fund’s business may be conducted under the
name of the Fund or, to the fullest extent permitted by law, any other name or
names deemed advisable by the Board.
2.3 Principal
and Registered Office.
The Fund
shall have its principal office at the principal office of the Adviser, or at
such other place designated from time to time by the Board.
The Fund
shall have its registered office in the State of Delaware at 0000 Xxxxxxxxxxx
Xxxx, Xxxxx 000, Xxxxxxxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxxxx 00000, and shall have
Corporation Service Company as its registered agent at such registered office
for service of process in the State of Delaware, unless a different registered
office or agent is designated from time to time by the Board in accordance with
the Delaware Act.
2.4 Duration.
The term
of the Fund commenced on the filing of the Certificate with the Secretary of
State of the State of Delaware and shall continue until the Fund is dissolved
pursuant to Section 6.1 hereof.
2.5 Business
of the Fund.
(a) The
business of the Fund is to purchase, sell (including short sales), invest and
trade in Securities, and to engage in any financial or derivative transactions
relating thereto or otherwise. The Fund’s assets may be invested in
general or limited partnerships, limited liability companies and other pooled
investment vehicles which invest and trade in Securities. The Adviser may
execute, deliver and perform all contracts, agreements and other undertakings
and engage in all activities and transactions as may in the opinion of the
Adviser be necessary or advisable to carry out the Fund’s business and any
amendments to any such contracts, agreements and other undertakings, all without
any further act, vote or approval of any other person, notwithstanding any other
provision of this Agreement.
(b) To serve
as a “master fund” to one or more “feeder funds”.
(c) The Fund
shall operate as a closed-end, management investment company in accordance with
the 1940 Act and subject to any fundamental policies and investment restrictions
set forth in the Form N-2.
2.6 The
Board.
(a) The
Organizational Member hereby designates those persons listed on Schedule I who
shall agree to be bound by the terms of this Agreement pertaining to the
obligations of Directors to serve as Directors on the initial
Board. The Board may, subject to the provisions of paragraphs (a) and
(b) of this Section 2.6 with respect to the number of and vacancies in the
position of Director and the provisions of Section 3.3 hereof with respect to
the election of Directors by Members, designate any person who shall agree to be
bound by all of the terms of this Agreement as a Director. The names
and mailing addresses of the Directors shall be set forth in the books and
records of the Fund.
-5-
(b) Each
Director shall serve as a Director for the duration of the term of the Fund,
unless his or her status as a Director shall be sooner terminated pursuant to
Section 4.2 hereof. If any vacancy in the position of a Director
occurs, the remaining Directors may appoint a person to serve in such capacity
(in accordance with any procedures adopted by the Board or any committee thereof
from time to time), so long as immediately after such appointment at least
two-thirds of the Directors then serving would have been elected by the
Members. The Directors may call a meeting of Members to fill any
vacancy in the position of Director, and shall do so within 60 days after any
date on which Directors who were elected by the Members cease to constitute a
majority of the Directors then serving as Directors.
(c) If no
Director remains, the Adviser shall promptly call a meeting of the Members, to
be held within 60 days after the date on which the last Director ceased to act
in that capacity, for the purpose of determining whether to continue the
business of the Fund and, if the business shall be continued, of electing the
required number of Directors. If the Members shall determine at such
meeting not to continue the business of the Fund or if the required number of
Directors is not elected within 60 days after the date on which the last
Director ceased to act in that capacity, then the Fund shall be dissolved
pursuant to Section 6.1 hereof and the assets of the Fund shall be liquidated
and distributed pursuant to Section 6.2 hereof.
2.7 Members.
(a) The Fund
may admit one or more Members as of the beginning of each calendar month or at
such other times as the Board may determine. Members may be admitted
to the Fund subject to the condition that each such Member shall execute an
appropriate signature page of this Agreement or an instrument pursuant to which
such Member agrees to be bound by all the terms and provisions
hereof. The Board, in its absolute discretion, may reject
applications for the purchase of Interests in the Fund. The admission
of any person as a Member shall be effective upon the acceptance by the Fund of
such Member’s subscription agreement (or other document(s) as may be required by
the Fund to evidence such Member’s subscription) and capital
contribution. Upon acceptance, the books and records of the Fund
shall be revised to reflect the name and the contribution to the capital of the
Fund of such additional Member. Notwithstanding the foregoing, the
Organizational Member hereby is admitted as a Member on the date
hereof.
(b) Upon its
signing of this Agreement and its contribution of the sum of not less than $100
to the capital of the Fund, the Adviser shall be admitted to the Fund as a
Member, subject to due approval, in accordance with the requirements of the 1940
Act, of the Investment Advisory Agreement. If at any time the
Investment Advisory Agreement between the Fund and the person then serving as
Adviser terminates, the Board shall admit as a substitute Member, upon its
signing this Agreement, such person as may be retained by the Fund to provide
investment advisory services pursuant to an investment advisory agreement,
subject to the due approval of such investment advisory agreement in accordance
with the requirements of the 1940 Act.
-6-
2.8 Organizational
Member.
Upon the
admission to the Fund of any additional Member pursuant to Section 2.7, the
Organizational Member shall withdraw from the Fund (automatically, without any
further action by any party) as the Organizational Member and shall be entitled
to the return of his Capital Contribution, if any, without interest or
deduction, and shall cease to be a member of the Fund.
2.9 Both
Directors and Members.
A person
may at the same time be a Director and a Member or the Adviser and a Member, in
which event such person’s rights and obligations in each capacity shall be
determined separately in accordance with the terms and provisions hereof and as
provided in the Delaware Act.
2.10 Limited
Liability.
Except as
otherwise provided under applicable law, none of the Members, Directors, nor,
except to the extent provided in Section 3.8 hereof and in the Investment
Advisory Agreement, the Adviser shall be liable personally for the Fund’s debts,
obligations or liabilities, whether arising in contract, tort or otherwise,
solely by reason of being a member or manager of the Fund, except that a Member
may be obligated to make capital contributions to the Fund and other payments
pursuant to this Agreement and to repay any funds wrongfully distributed to such
Member. Notwithstanding any other provision of this Agreement, the
Adviser, in the exercise of its functions on behalf of the Fund, may require a
Member to contribute to the Fund, at any time or from time to time, whether
before or after the dissolution of the Fund or after such Member ceases to be a
member of the Fund, such amounts as the Adviser, in its discretion, determines
are necessary to meet the Fund’s debts, obligations or liabilities (not to
exceed for any Member the aggregate amount of any distributions, amounts paid in
connection with a repurchase of all or a portion of such Member’s Interest and
any other amounts received by such Member from the Fund during or after the
Fiscal Year in which any debt, obligation or liability of the Fund arose or was
incurred); provided however, that each Member shall contribute only his pro rata share of the
aggregate amount requested based on such Member’s Capital Account in the Fiscal
Year in which the debt, obligation or liability arose or was incurred as a
percentage of the aggregate Capital Accounts of all Members of the Fund in such
Fiscal Year; and provided further that the provisions of this Section 2.10 shall
not affect the obligations of Members under the Delaware Act.
ARTICLE
III
MANAGEMENT
3.1 Management
and Control.
(a) Except to
the extent otherwise delegated to the Adviser, management and control of the
business of the Fund shall be vested in the Board, which shall serve as, and
have the right, power, and authority, on behalf of the Fund and in its name, to
exercise all rights, powers, and authority of a “manager” under the Delaware Act
and to do all things necessary and proper to carry out the objective and
business of the Fund and its duties hereunder. No Director shall have the
authority individually to act on behalf of or to bind the Fund except within the
scope of such Director’s authority as delegated by the Board. The
parties hereto intend that, except to the extent otherwise expressly provided
herein, (i) each Director shall be vested with the same powers, authority and
responsibilities on behalf of the Fund as are customarily vested in each
director of a Delaware corporation and (ii) each Independent Director shall be
vested with the same powers, authority and responsibilities on behalf of the
Fund as are customarily vested in each director of a closed-end management
investment company registered under the 1940 Act that is organized as a Delaware
corporation who is not an “interested person” of such company as such term is
defined in the 1940 Act. During any period in which the Fund shall
have no Directors, the Adviser shall continue to serve as investment adviser to
the Fund.
-7-
(b) Each
Member agrees not to treat, on his personal return or in any claim for a refund,
any item of income, gain, loss, deduction or credit in a manner inconsistent
with the treatment of such item by the Fund. The Board shall have the
exclusive authority and discretion to make any elections required or permitted
to be made by the Fund under any provisions of the Code or any other revenue
laws.
(c) Members
shall have no right to participate in and shall take no part in the management
or control of the Fund’s business and shall have no right, power or authority to
act for or bind the Fund. Members shall have the right to vote on any
matters only as provided in this Agreement or on any matters that require the
approval of the holders of voting securities under the 1940 Act.
(d) The Board
may delegate to any person any rights, power and authority vested by this
Agreement in the Board to the extent permissible under applicable
law.
3.2 Actions
by the Board.
(a) Unless
provided otherwise in this Agreement, the Board shall act only: (i) by the
affirmative vote of a majority of the Directors (which majority shall include
any requisite number of Independent Directors required by the 0000 Xxx) present
at a meeting duly called at which a quorum of the Directors shall be present (in
person or, if in person attendance is not required by the 1940 Act, in person or
by telephone) or (ii) by written consent of a majority of the Directors without
a meeting, if permissible under the 1940 Act.
(b) The Board
may designate from time to time a Chairman who shall preside at all
meetings. Meetings of the Board may be called by the Chairman or any
two Directors, and may be held on such date and at such time and place as the
Board shall determine. Each Director shall be entitled to receive
written notice of the date, time and place of such meeting within a reasonable
time in advance of the meeting. Notice need not be given to any
Director who shall attend a meeting without objecting to the lack of notice or
who shall execute a written waiver of notice with respect to the
meeting. Directors may attend and participate in any meeting by
telephone, except where in person attendance at a meeting is required by the
1940 Act. A majority of the Directors then in office shall constitute
a quorum at any meeting.
-8-
3.3 Officers.
(a) The Board
of Directors may elect one or more Officers. The Board of Directors may also
delegate to an Officer the authority to appoint, remove or fix the duties,
compensation or terms of office of, one or more other Officers as the Board of
Directors shall at any time and from time to time deem to be advisable. A person
holding more than one office may not act in more than one capacity to execute,
acknowledge or verify on behalf of the Fund any instrument required by law
to be executed, acknowledged and verified by more than one Officer. No Officer
need also be a Director.
(b) Each
Officer shall hold office until his successor is elected or appointed or until
his earlier displacement from office by resignation, removal or otherwise;
provided, that if the term of office of any Officer shall have been fixed by the
Board of Directors, or by an Officer acting under authority delegated by the
Board of Directors, such Officer shall cease to hold such office no later than
the date of expiration of such term, regardless of whether any other person
shall have been elected or appointed to succeed him. Any Officer may resign at
any time by written notice to the Fund . Any Officer may be removed at any time
by the Board of Directors or by an Officer acting under authority delegated by
the Board of Directors if in its or his judgment the best interest of the Fund
would be served thereby, but such removal shall be without prejudice to the
contract rights, if any, of the person so removed. Election or
appointment of an Officer shall not of itself create contract rights between the
Fund and such Officer.
(c) If the
office of any Officer becomes vacant for any reason, the vacancy may be filled
by the Board of Directors or by the Officer acting under authority delegated by
the Board of Directors. Each Officer elected or appointed to fill a vacancy
shall hold office for the balance of the term for which his predecessor was
elected or appointed.
(d) All
Officers as between themselves and the Fund shall have such powers, perform such
duties and be subject to such restrictions, if any, in the management of the
Fund as may be provided in this Agreement or, to the extent not so provided, as
may be prescribed by the Board of Directors or by the Officer acting under
authority delegated by the Board of Directors.
3.4 Meetings
of Members.
(a) Actions
requiring the vote of the Members may be taken at any duly constituted meeting
of the Members at which a quorum is present. Except as otherwise
provided in Section 2.6(c) hereof, meetings of the Members may be called by the
Board or by Members holding a majority of the total number of votes eligible to
be cast by all Members, and may be held at such time, date and place as the
Board or, to the extent applicable, the Adviser shall determine. The
Board shall arrange to provide written notice of the meeting, stating the date,
time and place of the meeting and the record date therefor, to each Member
entitled to vote at the meeting within a reasonable time prior
thereto. Failure to receive notice of a meeting on the part of any
Member shall not affect the validity of any act or proceeding of the meeting, so
long as a quorum shall be present at the meeting. Only matters set
forth in the notice of a meeting may be voted on by the Members at a
meeting. The presence in person or by proxy of Members holding a
majority of the total number of votes eligible to be cast by all Members as of
the record date shall constitute a quorum at any meeting. In the
absence of a quorum, a meeting of the Members may be adjourned by action of a
majority of the Members present in person or by proxy without additional notice
to the Members. Except as otherwise required by any provision of this
Agreement or of the 1940 Act, (i) those candidates receiving a plurality of the
votes cast at any meeting of Members shall be elected as Directors and (ii) all
other actions of the Members taken at a meeting shall require the affirmative
vote of Members holding a majority of the total number of votes eligible to be
cast by those Members who are present in person or by proxy at such
meeting.
-9-
(b) Each
Member shall be entitled to cast at any meeting of Members a number of votes
equivalent to such Member’s Voting Interest. The Board or, to the
extent applicable, the Adviser shall establish a record date not less than 10
nor more than 75 days prior to the date of any meeting of Members to determine
eligibility to vote at such meeting and the number of votes which each Member
will be entitled to cast thereat, and shall maintain for each such record date a
list setting forth the name of each Member and the number of votes that each
Member will be entitled to cast at the meeting.
(c) A Member
may vote at any meeting of Members by a proxy properly executed in writing by
the Member and filed with the Fund before or at the time of the
meeting. A proxy may be suspended or revoked, as the case may be, by
the Member executing the proxy by a later writing delivered to the Fund at any
time prior to exercise of the proxy or if the Member executing the proxy shall
be present at the meeting and decide to vote in person. Any action of
the Members that is permitted to be taken at a meeting of the Members may be
taken without a meeting if consents in writing, setting forth the action taken,
are signed by Members holding a majority of the total number of votes eligible
to be cast or such greater percentage as may be required in order to approve
such action.
3.5 Custody
of Assets of the Fund.
The
physical possession of all funds, Securities or other property of the Fund shall
at all times, be held, controlled and administered by one or more custodians
retained by the Fund in accordance with the requirements of the 1940
Act.
3.6 Other
Activities of Members, Directors and the Adviser
(a) None of
the Directors, officers of the Fund nor the Adviser shall be required to devote
full time to the affairs of the Fund, but shall devote such time as may
reasonably be required to perform their obligations under this Agreement and any
other agreement they may have with the Fund.
(b) The
Adviser and any Member, officer of the Fund, Director, or Affiliate of any of
them, may engage in or possess an interest in other business ventures or
commercial dealings of every kind and description, independently or with others,
including, but not limited to, acquisition and disposition of Securities,
provision of investment advisory or brokerage services, serving as directors,
officers, employees, advisors or agents of other companies, partners of any
partnership, members of any limited liability company, or trustees of any trust,
or entering into any other commercial arrangements. No Member shall
have any rights in or to such activities of the Adviser or any other Member,
officer of the Fund, Director, or Affiliates of any of them, or any profits
derived therefrom, and the pursuit of such activities, even if competitive with
the activities of the Fund, shall not be deemed wrongful or
improper. No such person shall be liable to the Fund or any Members
for breach of any fiduciary or other duty by reason of the fact that such person
pursues or acquires for, or directs an opportunity to another person or does not
communicate such opportunity to the Fund.
-10-
3.7 Duty of
Care.
(a) The
Directors, officers of the Fund, the Adviser, including any officer, director,
member, partner, principal, employee or agent of the Adviser and each of their
respective affiliates, shall not be liable to the Fund or to any of its Members
for any loss or damage occasioned by any act or omission in the performance of
such person’s services under this Agreement, unless it shall be determined by
final judicial decision on the merits from which there is no further right to
appeal that such loss is due to an act or omission of such person constituting
willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of such person’s duties hereunder.
(b) A Member
not in breach of any obligation hereunder or under any agreement pursuant to
which the Member subscribed for an Interest shall be liable to the Fund, any
other Member or third parties only as required by applicable law or otherwise
provided in this Agreement.
3.8 Indemnification.
(a) To the
fullest extent permitted by law, the Fund shall, subject to Section 3.8(b)
hereof, indemnify each Director (including for this purpose their executors,
heirs, assigns, successors or other legal representatives) and each officer of
the Fund against all losses, claims, damages, liabilities, costs and expenses,
including, but not limited to, amounts paid in satisfaction of judgments, in
compromise, or as fines or penalties, and reasonable counsel fees, incurred in
connection with the defense or disposition of any action, suit, investigation or
other proceeding, whether civil or criminal, before any judicial, arbitral,
administrative or legislative body, in which such indemnitee may be or may have
been involved as a party or otherwise, or with which such indemnitee may be or
may have been threatened, while in office or thereafter, by reason of being or
having been a Director or an officer of the Fund, as the case may be, of the
Fund or the past or present performance of services to the Fund by such
indemnitee, except to the extent such loss, claim, damage, liability, cost or
expense shall have been finally determined in a non-appealable decision on the
merits in any such action, suit, investigation or other proceeding to have been
incurred or suffered by such indemnitee by reason of willful misfeasance, bad
faith, gross negligence, or reckless disregard of the duties involved in the
conduct of such indemnitee’s office. The rights of indemnification
provided under this Section 3.8 shall not be construed so as to provide for
indemnification of an indemnitee for any liability (including liability under
federal securities laws which, under certain circumstances, impose liability
even on persons that act in good faith) to the extent (but only to the extent)
that such indemnification would be in violation of applicable law, but shall be
construed so as to effectuate the applicable provisions of this Section 3.8 to
the fullest extent permitted by law.
-11-
(b) Expenses,
including reasonable counsel fees, so incurred by any such indemnitee (but
excluding amounts paid in satisfaction of judgments, in compromise, or as fines
or penalties), may be paid from time to time by the Fund in advance of the final
disposition of any such action, suit, investigation or proceeding upon receipt
of an undertaking by or on behalf of such indemnitee to repay to the Fund
amounts so paid if it shall ultimately be determined that indemnification of
such expenses is not authorized under Section 3.8(a) hereof; provided, however,
that (i) such indemnitee shall provide security for such undertaking, (ii) the
Fund shall be insured by or on behalf of such indemnitee against losses arising
by reason of such indemnitee’s failure to fulfill his or its undertaking, or
(iii) a majority of the Directors (excluding any Director who is seeking
advancement of expenses hereunder) or independent legal counsel in a written
opinion shall determine based on a review of readily available facts (as opposed
to a full trial-type inquiry) that there is reason to believe such indemnitee
ultimately will be entitled to indemnification.
(c) As to the
disposition of any action, suit, investigation or proceeding (whether by a
compromise payment, pursuant to a consent decree or otherwise) without an
adjudication or a decision on the merits by a court, or by any other body before
which the proceeding shall have been brought, that an indemnitee is liable to
the Fund or its members by reason of willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties involved in the conduct of such
indemnitee’s office, indemnification shall be provided pursuant to Section
3.8(a) hereof if (i) approved as in the best interests of the Fund by a majority
of the Directors (excluding any Director who is seeking indemnification
hereunder) upon a determination based upon a review of readily available facts
(as opposed to a full trial-type inquiry) that such indemnitee acted in good
faith and in the reasonable belief that such actions were in the best interests
of the Fund and that such indemnitee is not liable to the Fund or its members by
reason of willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties involved in the conduct of such indemnitee’s office, or
(ii) the Directors secure a written opinion of independent legal counsel based
upon a review of readily available facts (as opposed to a full trial-type
inquiry) to the effect that such indemnitee acted in good faith and in the
reasonable belief that such actions were in the best interests of the Fund and
that such indemnitee is not liable to the Fund or its members by reason of
willful misfeasance, bad faith, gross negligence, or reckless disregard of the
duties involved in the conduct of such indemnitee’s office.
(d) Any
indemnification or advancement of expenses made pursuant to this Section 3.8
shall not prevent the recovery from any indemnitee of any such amount if such
indemnitee subsequently shall be determined in a decision on the merits in any
action, suit, investigation or proceeding involving the liability or expense
that gave rise to such indemnification or advancement of expenses to be liable
to the Fund or its members by reason of willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties involved in the conduct of such
indemnitee’s office. In any suit brought by an indemnitee to enforce
a right to indemnification under this Section 3.8 it shall be a defense that,
and in any suit in the name of the Fund to recover any indemnification or
advancement of expenses made pursuant to this Section 3.8 the Fund shall be
entitled to recover such expenses upon a final adjudication that, the indemnitee
has not met the applicable standard of conduct set forth in this Section
3.8. In any such suit brought to enforce a right to indemnification
or to recover any indemnification or advancement of expenses made pursuant to
this Section 3.8, the burden of proving that the indemnitee is not entitled to
be indemnified, or to any indemnification or advancement of expenses, under this
Section 3.8 shall be on the Fund (or any Member acting derivatively or otherwise
on behalf of the Fund or its members).
-12-
(e) An
indemnitee may not satisfy any right of indemnification or advancement of
expenses granted in this Section 3.8 or to which he, she or it may otherwise be
entitled except out of the assets of the Fund, and no Member shall be personally
liable with respect to any such claim for indemnification or advancement of
expenses, except to the extent provided in Section 2.10 hereof.
(f) The
rights of indemnification provided hereunder shall not be exclusive of or affect
any other rights to which any person may be entitled by contract or otherwise
under law. Nothing contained in this Section 3.8 shall affect the
power of the Fund to purchase and maintain liability insurance on behalf of any
officer of the Fund, Director, the Adviser or other person.
3.9 Fees,
Expenses and Reimbursement.
(a) So long
as the Administrator provides administrative services to the Fund, it shall be
entitled to receive fees for such services as may be agreed to by the
Administrator and the Fund pursuant to an administrative services agreement,
without any further act, vote or approval of any Member.
(b) The Board
may cause the Fund to compensate each Director who is not an officer or employee
of the Adviser for his or her services hereunder. In addition, the
Fund shall reimburse the Directors for reasonable out-of-pocket expenses
incurred by them in performing their duties under this Agreement.
(c) The Fund
shall bear all expenses incurred in the business of the Fund other than those
specifically required to be borne by the Adviser pursuant to the Investment
Advisory Agreement. Expenses to be borne by the Fund may include, but
are not limited to, the following:
|
(i)
|
all
costs and expenses directly related to portfolio transactions and
positions for the Fund’s account, including, but not limited to, brokerage
commissions, research fees, research-related travel, interest and
commitment fees on loans and debit balances, borrowing charges on
Securities sold short, dividends on Securities sold short but not yet
purchased, custodial fees, margin fees, transfer taxes and premiums and
taxes withheld on foreign dividends and expenses from investments in
Investment Funds;
|
|
(ii)
|
all
costs and expenses associated with the operation and ongoing registration
of the Fund, and expenses and the costs of compliance with any applicable
Federal or state laws;
|
|
(iii)
|
all
fees and expenses of third party service providers for the provision of
ongoing investor services to
Members;
|
-13-
|
(iv)
|
the
costs and expenses of holding any meetings of the Board and any meetings
of Members that are regularly scheduled, permitted or are required to be
held by this Agreement, the 1940 Act or other applicable
law;
|
|
(v)
|
a
portion, as determined by the Board, of the compensation payable to the
Fund’s chief compliance officer;
|
|
(vi)
|
fees
and disbursements of any attorneys, accountants, auditors and other
consultants and professionals engaged on behalf of the
Fund;
|
|
(vii)
|
the
costs of a fidelity bond and any liability or other insurance obtained on
behalf of the Fund, the Adviser, or the Directors or the officers of the
Fund;
|
|
(viii)
|
all
costs and expenses of preparing, setting in type, printing and
distributing reports and other communications to
Members;
|
|
(ix)
|
all
expenses of computing the Fund’s net asset value, including any equipment
or services obtained for the purpose of valuing the Fund’s investment
portfolio, including appraisal and valuation services provided by third
parties;
|
|
(x)
|
all
charges for equipment or services used for communications between the Fund
and any custodian, or other agent engaged by the
Fund;
|
|
(xi)
|
fees
of custodians and other persons providing administrative services to the
Fund; and
|
|
(xii)
|
such
other types of expenses as may be approved from time to time by the
Board.
|
The
Adviser shall be entitled to reimbursement from the Fund for any of the above
expenses that the Adviser pays on behalf of the Fund.
(d) The Fund
from time to time, alone or in conjunction with other accounts for which the
Adviser, or any Affiliate of the Adviser, acts as general partner, managing
member or investment adviser, may purchase insurance in such amounts, from such
insurers and on such terms as the Board shall determine.
3.10 Liabilities
and Duties.
The Members agree that the provisions
of this Agreement, to the extent that they restrict or eliminate the duties and
liabilities of a Member, officer of the Fund, a Director or other person
otherwise existing at law or in equity, replace such other duties and
liabilities of such Member, officer of the Fund, Director or other
person.
-14-
ARTICLE
IV
TERMINATION
OF STATUS OF ADVISER AND DIRECTORS; TRANSFERS AND
REPURCHASES
4.1 Termination
of Status of the Adviser.
[The
status of the Adviser as a Member shall terminate if the Investment Advisory
Agreement with the Adviser terminates and the Fund does not enter into a new
Investment Advisory Agreement with such person, effective as of the date of such
termination.]
4.2 Termination
of Status of a Director.
The
status of a Director shall terminate if the Director (i) shall die; (ii) shall
be adjudicated incompetent; (iii) shall voluntarily withdraw as a Director (upon
not less than 90 days’ prior written notice to the other Directors, unless the
other Directors waive such notice); (iv) shall be removed under Section 4.3; (v)
shall be certified by a physician to be mentally or physically unable to perform
his duties hereunder; or (vi) shall have a receiver appointed to administer the
property or affairs of such Director.
4.3 Removal
of the Directors.
Any
Director may be removed either by (a) the vote or written consent of at least
two-thirds of the Directors not subject to the removal vote or (b) the vote or
written consent of Members holding not less than two-thirds of the total number
of votes eligible to be cast by all Members.
4.4 Transfer
of Interests of Members.
(a) An
Interest or portion thereof of a Member may be Transferred only (i) by operation
of law pursuant to the death, bankruptcy, insolvency or dissolution of such
Member or (ii) with the written consent of the Board (which may be withheld in
its sole and absolute discretion). If any transferee does not meet
such investor eligibility requirements established by the Fund from time to
time, the Fund reserves the right to redeem its Interest pursuant to Section
4.5. If the Board does not consent to a Transfer by operation of law,
the Fund shall redeem the Interest from the Member’s successor. Any
permitted transferee shall be entitled to the allocations and distributions
allocable to the Interest so acquired and to Transfer such Interest in
accordance with the terms of this Agreement, but shall not be entitled to the
other rights of a Member unless and until such transferee becomes a substituted
Member. If a Member Transfers an Interest or portion thereof with the
approval of the Board, the Fund shall promptly take all necessary actions so
that each transferee or successor to whom such Interest or portion thereof is
Transferred is admitted to the Fund as a substituted Member. The
admission of any transferee as a substituted Member shall be effective upon the
execution and delivery by, or on behalf of, such substituted Member of either a
counterpart of this Agreement or an instrument that constitutes the execution
and delivery of this Agreement. Each transferring Member and
transferee agrees to pay all expenses, including attorneys’ and accountants’
fees, incurred by the Fund in connection with such Transfer. Upon the
Transfer to another person or persons of a Member’s entire Interest, such Member
shall cease to be a member of the Fund.
-15-
(b) Each
transferring Member shall indemnify and hold harmless the Fund, the Directors,
the officers of the Fund, each other Member and any Affiliate of the foregoing
against all losses, claims, damages, liabilities, costs and expenses (including
legal or other expenses incurred in investigating or defending against any such
losses, claims, damages, liabilities, costs and expenses or any judgments, fines
and amounts paid in settlement), joint or several, to which such persons may
become subject by reason of or arising from (i) any Transfer made by such Member
in violation of this Section 4.4 and (ii) any misrepresentation by such Member
in connection with any such Transfer.
4.5 Repurchase
of Interests.
(a) Except as
otherwise provided in this Agreement, no Member or other person holding an
Interest or portion thereof shall have the right to withdraw or tender to the
Fund for repurchase of that Interest or portion thereof. The Board
may from time to time, in its complete and exclusive discretion and on such
terms and conditions as it may determine, cause the Fund to repurchase Interests
or portions thereof pursuant to written tenders. However, the Fund
shall not offer to repurchase Interests on more than four occasions during any
Fiscal Year unless it has been advised by counsel to the Fund that such more
frequent offers would not cause a material adverse tax consequence to the
Members. In determining whether to cause the Fund to repurchase
Interests or portions thereof pursuant to written tenders, the Board shall
consider the following factors, among others:
|
(i)
|
whether
any Members have requested to tender Interests or portions thereof to the
Fund;
|
|
(ii)
|
the
liquidity of the Fund’s assets;
|
|
(iii)
|
the
investment plans and working capital requirements of the
Fund;
|
|
(iv)
|
the
relative economies of scale with respect to the size of the
Fund;
|
|
(v)
|
the
history of the Fund in repurchasing Interests or portions
thereof;
|
|
(vi)
|
the
condition of the securities markets;
and
|
|
(vii)
|
the
anticipated tax consequences of any proposed repurchases of Interests or
portions thereof.
|
The Board
shall cause the Fund to repurchase Interests or portions thereof pursuant to
written tenders only on terms fair to the Fund and to all Members (including
persons holding Interests acquired from Members), as applicable.
(b) The
Adviser may tender its Interest or a portion thereof as a Member under Section
4.5(a) hereof.
(c) If the
Adviser’s status as a Member is terminated pursuant to Section 4.1 hereof, it
(or its trustee or other legal representative) may, by written notice to the
Board within 60 days of the effective date of such termination, tender to the
Fund for repurchase all or any portion of its Capital Account. Not
later than 30 days after the receipt of such notice, the Board shall cause such
tendered portion of the Capital Account to be repurchased by the Fund for
cash.
-16-
(d) The Board
may cause the Fund to repurchase an Interest or portion thereof of a Member or
any person acquiring an Interest or portion thereof from or through a Member if
the Board determines or has reason to believe that:
|
(i)
|
such
an Interest or portion thereof has been transferred in violation of
Section 4.4 hereof, or such an Interest or portion thereof has vested in
any person by operation of law as the result of the death, dissolution,
bankruptcy or incompetency of a
Member;
|
|
(ii)
|
ownership
of such an Interest by a Member or other person will cause the Fund to be
in violation of, or require registration of any Interest or portion
thereof under, or subject the Fund to additional registration or
regulation under, the securities, commodities or other laws of the United
States or any other relevant
jurisdiction;
|
|
(iii)
|
continued
ownership of such an Interest may be harmful or injurious to the business
or reputation of the Fund, the Adviser or the Directors, or may subject
the Fund or any of the Members to an undue risk of adverse tax or other
fiscal consequences;
|
|
(iv)
|
any
of the representations and warranties made by a Member in connection with
the acquisition of an Interest or portion thereof was not true when made
or has ceased to be true; or
|
|
(v)
|
it
would be in the best interests of the Fund, as determined by the Board,
for the Fund to repurchase such an Interest or portion
thereof.
|
(e) Repurchases
of Interests or portions thereof by the Fund shall be payable in cash or in part
by promissory note, in each case without interest, unless the Board, in its
discretion, determines otherwise, or, in the discretion of the Board, in
Securities (or any combination of Securities and cash) of equivalent
value. All such repurchases shall be subject to any and all
conditions as the Board may impose and shall be effective as of a date set by
the Board after receipt by the Fund of all eligible written tenders of Interests
or portion thereof. The amount due to any Member whose Interest or
portion thereof is repurchased shall be equal to the estimated value of such
Member’s Capital Account or portion thereof as applicable as of the effective
date of repurchase, after giving effect to all allocations to be made to such
Member’s Capital Account as of such date.
ARTICLE
V
CAPITAL
5.1 Contributions
to Capital.
-17-
(a) The
minimum initial contribution of each Member (other than the Adviser) to the
capital of the Fund shall be the amount set forth, from time to time, in the
Fund’s Form N-2 or such other amount as the Board may determine from time to
time. The amount of the initial contribution of each Member shall be
recorded on the books and records of the Fund upon acceptance as a contribution
to the capital of the Fund. The Directors shall not be entitled to
make voluntary contributions of capital to the Fund as Directors of the Fund,
but may make voluntary contributions to the capital of the Fund as
Members. The Adviser may, but shall not, except as provided in
Section 2.7(b), be required to, make any capital contributions.
(b) The
Members may make additional contributions to the capital of the Fund, effective
as of such times as the Board in its discretion may permit, but no Member shall
be obligated to make any additional contribution to the capital of the Fund
except to the extent otherwise provided herein.
(c) Except as
otherwise permitted by the Board, (i) initial and any additional contributions
to the capital of the Fund by any Member shall be payable in cash or in such
Securities that the Board, in its absolute discretion, may agree to accept on
behalf of the Fund, and (ii) initial and any additional contributions in cash
shall be payable in readily available funds at the date of the proposed
acceptance of the contribution. The value of contributed Securities
shall be determined in accordance with Section 7.3 hereof as of the date of
contribution.
5.2 Rights of
Members to Capital.
No Member
shall be entitled to interest on his or its contribution to the capital of the
Fund, nor shall any Member be entitled to the return of any capital of the Fund
except (i) upon the repurchase by the Fund of a part or all of such Member’s
Interest pursuant to Section 4.5 hereof, if so determined by the Board, (ii)
pursuant to the provisions of Section 5.6(c) hereof or (iii) upon the
liquidation of the Fund’s assets pursuant to Section 6.2
hereof. Except as provided in Section 2.10 hereof, no Member shall be
liable for the return of any such amounts. No Member shall have the
right to require partition of the Fund’s property or to compel any sale or
appraisal of the Fund’s assets.
5.3 Capital
Accounts.
(a) The Fund
shall maintain a separate Capital Account for each Member.
(b) Each
Member’s Capital Account shall have an initial balance equal to the amount of
cash and the value of any Securities (determined in accordance with Section 7.3
hereof) constituting such Member’s initial contribution to the capital of the
Fund.
(c) Each
Member’s Capital Account shall be increased by the sum of (i) the amount of cash
and the value of any Securities (determined in accordance with Section 7.3
hereof) constituting additional contributions by such Member to the capital of
the Fund permitted pursuant to Section 5.1 hereof, plus (ii) any amount credited
to such Member’s Capital Account pursuant to the provisions of this Article
V.
(d) Each
Member’s Capital Account shall be reduced by the sum of (i) the amount of any
repurchase of the Interest, or portion thereof, of such Member or distributions
to such Member pursuant to Sections 4.5, 5.8 or 6.2 hereof which are not
reinvested, plus (ii) any amounts debited against such Member’s Capital Account
pursuant to the provisions of this Article V.
-18-
(e) If all or
a portion of an Interest is transferred in accordance with the terms of this
Agreement, the transferee shall succeed to the Capital Account of the transferor
to the extent it relates to the transferred Interest.
5.4 Allocation
of Net Profit and Loss.
As of the
last day of each Fiscal Period, any Net Profit or Net Loss for the Fiscal Period
shall be allocated among and credited to or debited against the Capital Accounts
of the Members in accordance with their respective Fund Percentages for such
Fiscal Period.
5.5 Allocation
of Certain Withholding Taxes and Other Expenditures.
(a) If the
Fund incurs a withholding tax or other tax obligation with respect to the share
of Fund income allocable to any Member, then the Board, without limitation of
any other rights of the Fund or the Board, shall cause the amount of such
obligation to be debited against the Capital Account of such Member when the
Fund pays such obligation, and any amounts then or thereafter distributable to
such Member shall be reduced by the amount of such taxes. If the
amount of such taxes is greater than any such distributable amounts, then such
Member and any successor to such Member’s Interest shall pay to the Fund as a
contribution to the capital of the Fund, upon demand of the Fund, the amount of
such excess. The Fund shall not be obligated to apply for or obtain a
reduction of or exemption from withholding tax on behalf of any Member that may
be eligible for such reduction or exemption; provided, that in the event that
the Fund determines that a Member is eligible for a refund of any withholding
tax, the Fund may, at the request and expense of such Member, assist such Member
in applying for such refund.
(b) Except as
otherwise provided for in this Agreement and unless prohibited by the 1940 Act,
any expenditures payable by the Fund, and any other Fund items, to the extent
determined by the Board to have been paid or incurred or withheld on behalf of,
or by reason of particular circumstances applicable to, one or more but fewer
than all of the Members, shall be charged to only those Members on whose behalf
such expenditures or items are paid or incurred or whose particular
circumstances gave rise to such expenditures or items. Such charges
shall be debited from the Capital Accounts of such Members as of the close of
the Fiscal Period during which any such items were paid or accrued by the
Fund.
5.6 Reserves.
(a) Appropriate
reserves may be created, accrued and charged against Net Assets and
proportionately against the Capital Accounts of the Members for contingent
liabilities, if any, as of the date any such contingent liability becomes known
to the Adviser or the Board, such reserves to be in the amounts which the Board
in its sole discretion deem necessary or appropriate. The Board may
increase or reduce any such reserves from time to time by such amounts as it in
its sole discretion deems necessary or appropriate. The amount of any
such reserve, or any increase or decrease therein, shall be proportionately
charged or credited, as appropriate, to the Capital Accounts of those parties
who are Members at the time when such reserve is created, increased or
decreased, as the case may be; provided, however, that if any such individual
reserve item, adjusted by any increase therein, exceeds the lesser of $500,000
or 1% of the aggregate value of the Capital Accounts of all such Members, the
amount of such reserve, increase, or decrease instead may be charged or credited
to those parties who were Members at the time, as determined by the Board in its
sole discretion, of the act or omission giving rise to the contingent liability
for which the reserve was established, increased or decreased in proportion to
their Capital Accounts.
-19-
(b) If at any
time an amount is paid or received by the Fund (other than contributions to the
capital of the Fund, distributions or repurchases of Interests or portions
thereof) and such amount exceeds the lesser of $500,000 or 1% of the aggregate
value of the Capital Accounts of all Members at the time of payment or receipt
and such amount was not accrued or reserved for but would nevertheless, in
accordance with the Fund’s accounting practices, be treated as applicable to one
or more prior Fiscal Periods, then such amount may, as determined by the Board
in its sole discretion, be proportionately charged or credited, as appropriate,
to those parties who were Members during such prior Fiscal Period or
Periods.
(c) If any
amount is required by paragraph (a) or (b) of this Section 5.6 to be charged or
credited to a party who is no longer a Member, such amount shall be paid by or
to such party, as the case may be, in cash, with interest from the date on which
the Board determines that such charge or credit is required. In the
case of a charge, the former Member shall be obligated to pay the amount of the
charge, plus interest as provided above, to the Fund on demand; provided,
however, that (i) in no event shall a former Member be obligated to make a
payment exceeding the amount of such Member’s Capital Account at the time to
which the charge relates; and (ii) no such demand shall be made after the
expiration of three years from the date on which such party ceased to be a
Member. To the extent that a former Member fails to pay to the Fund,
in full, any amount required to be charged to such former Member pursuant to
paragraph (a) or (b), whether due to the expiration of the applicable limitation
period or for any other reason whatsoever, the deficiency shall be charged
proportionately to the Capital Accounts of the Members at the time of the act or
omission giving rise to the charge to the extent feasible, and otherwise
proportionately to the Capital Accounts of the current Members.
5.7 Tax
Allocations.
For each
Fiscal Year, items of income, deduction, gain, loss or credit shall be allocated
for income tax purposes among the Members in such a manner as to reflect
equitably amounts credited or debited to each Member’s Capital Account for the
current and prior Fiscal Years (or relevant portions
thereof). Allocations under this Section 5.7 shall be made pursuant
to the principles of Sections 704(b) and 704(c) of the Code, and in conformity
with Treasury Regulations Sections 1.704-1(b)(2)(iv)(f), 1.704-1(b)(4)(i) and
1.704-3(e) promulgated thereunder, as applicable, or the successor provisions to
such Section and Regulations. Notwithstanding anything to the contrary in this
Agreement, there shall be allocated to the Members such gains or income as shall
be necessary to satisfy the “qualified income offset” requirement of Treasury
Regulations Section 1.704-1(b)(2)(ii)(d).
-20-
If the
Fund realizes capital gain or loss (including short-term capital gain or loss)
for Federal income tax purposes for any Fiscal Year during or as of the end of
which one or more Members withdraw from the Fund pursuant to Articles IV or VI
hereof, the Board may elect to allocate specially such gain or loss to any such
withdrawing Member up to an amount by which the total of such Member’s Capital
Account as of the effective date of withdrawal exceeds or is less than its
“adjusted tax basis,” for Federal income tax purposes, in its Interest as of
such time (determined without regard to any adjustments made to such “adjusted
tax basis” by reason of any transfer or assignment of such Interest, including
by reason of death and without regard to such Member’s share of the liabilities
of the Fund under Section 752 of the Code).
5.8 Distributions.
(a) The
Board, in its sole discretion, may authorize the Fund to make distributions in
cash or in kind at any time to all of the Members on a pro rata basis in accordance
with the Members’ Fund Percentages. Notwithstanding anything to the
contrary in this Agreement, a Member may be compelled to accept a distribution
of any asset in kind from the Fund despite the fact that the percentage of the
asset distributed to the Member exceeds the percentage of that asset which is
equal to the percentage in which the Member shares in distributions from the
Fund.
(b) The Board
may withhold taxes from any distribution to any Member to the extent required by
the Code or any other applicable law. For purposes of this Agreement,
any taxes so withheld by the Fund with respect to any amount distributed by the
Fund to any Member shall be deemed to be a distribution or payment to such
Member, reducing the amount otherwise distributable to such Member pursuant to
this Agreement and, if appropriate, reducing the Capital Account of such
Member.
(c) Notwithstanding
anything to the contrary contained herein, none of the Directors or the Members,
nor any other person on behalf of the Fund, shall make a distribution to the
Members on account of their interest in the Fund if such distribution would
violate the Delaware Act or other applicable law.
ARTICLE
VI
DISSOLUTION
AND LIQUIDATION
6.1 Dissolution.
(a) The Fund
shall be dissolved at any time there are no members of the Fund, unless the Fund
is continued in accordance with the Delaware Act, or upon the occurrence of any
of the following events:
|
(i)
|
upon
the affirmative vote to dissolve the Fund by the
Board;
|
|
(ii)
|
upon
the determination of the Members not to continue the business of the Fund
at a meeting called by the Adviser in accordance with Section 2.6(c)
hereof when no Director remains to continue the business of the Fund or if
the required number of Directors is not elected within 60 days after the
date on which the last Director ceased to act in that
capacity;
|
-21-
|
(iii)
|
upon
the expiration of any two-year period which commences on the date on which
any Member has submitted a written notice to the Fund requesting to tender
such Member’s entire Interest for repurchase by the Fund if such Member
has not been permitted to do so at any time during such
period;
|
|
(iv)
|
upon
the determination by the Adviser to dissolve the Fund;
or
|
|
(v)
|
as
required by operation of law.
|
Except as
provided above, Members shall not have the authority, by vote or otherwise, to
dissolve or cause the dissolution of the Fund. Dissolution of the
Fund shall be effective on the day on which the event giving rise to the
dissolution shall occur, but the Fund shall not terminate until the assets of
the Fund have been liquidated in accordance with Section 6.2 hereof and the
Certificate has been canceled.
6.2 Liquidation
of Assets.
(a) Upon the
dissolution of the Fund as provided in Section 6.1 hereof, the Board, acting
directly or through a liquidator it selects, shall liquidate, in an orderly
manner, the business and administrative affairs of the Fund, except that if the
Board is unable to perform this function, a liquidator elected by Members
holding a majority of the total number of votes eligible to be cast by all
Members shall liquidate, in an orderly manner, the business and administrative
affairs of the Fund. Net Profit and Net Loss during the period of
liquidation shall be allocated pursuant to Article V hereof. The
proceeds from liquidation shall, subject to the Delaware Act, be distributed in
the following manner:
|
(i)
|
in
satisfaction (whether by payment or the making of reasonable provision for
payment thereof) of the debts and liabilities of the Fund, including the
expenses of liquidation (including legal and accounting expenses incurred
in connection therewith), but not including debt and liabilities to
Members, up to and including the date that distribution of the Fund’s
assets to the Members has been completed, shall first be paid on a pro rata
basis;
|
|
(ii)
|
such
debts, liabilities or obligations as are owing to the Members shall be
paid next in their order of seniority and on a pro rata basis;
and
|
|
(iii)
|
the
Members shall be paid next on a pro rata basis the
positive balances of their respective Capital Accounts after giving effect
to all allocations to be made to such Members’ Capital Accounts for the
Fiscal Period ending on the date of the distributions under this Section
6.2(a)(3).
|
(b) Anything
in this Section 6.2 to the contrary notwithstanding, but subject to the
priorities set forth in Section 6.2(a) above, upon dissolution of the Fund, the
Board or other liquidator may distribute ratably in kind any assets of the Fund;
provided, however, that if any in-kind distribution is to be made (i) the assets
distributed in kind shall be valued pursuant to Section 7.3 hereof as of the
actual date of their distribution and charged as so valued and distributed
against amounts to be paid under Section 6.2(a) above, and (ii) any profit or
loss attributable to property distributed in-kind shall be included in the Net
Profit or Net Loss for the Fiscal Period ending on the date of such
distribution.
-22-
ARTICLE
VII
ACCOUNTING,
VALUATIONS AND BOOKS AND RECORDS
7.1 Accounting
and Reports.
(a) The Fund
shall adopt for tax accounting purposes any accounting method which the Board
shall decide in its sole discretion is in the best interests of the
Fund. The Fund’s accounts shall be maintained in U.S.
currency.
(b) After the
end of each taxable year, the Fund shall furnish to each Member such information
regarding the operation of the Fund and such Member’s Interest as is necessary
for Members to complete federal and state income tax or information returns and
any other tax information required by federal or state law.
(c) Except as
otherwise required by the 1940 Act, or as may otherwise be permitted by rule,
regulation or order, within 60 days after the close of the period for which a
report required under this Section 7.1(c) is being made, the Fund shall furnish
to each Member a semi-annual report and an annual report containing the
information required by the 1940 Act. The Fund shall cause financial
statements contained in each annual report furnished hereunder to be accompanied
by a certificate of independent public accountants based upon an audit performed
in accordance with generally accepted accounting principles. The Fund
may furnish one or more Members such other periodic reports as it deems
necessary or appropriate in its sole discretion.
(d) Except as
set forth specifically in this Section 7.1, no Member shall have the right to
obtain any other information about the business or financial condition of the
Fund, about any other Member or former Member, including information about the
Capital Contribution of a Member, or about the affairs of the
Fund. No act of the Fund, the Adviser or any other person that
results in a Member being furnished any such information shall confer on such
Member or any other Member the right in the future to receive such or similar
information or constitute a waiver of, or limitation on, the Fund’s ability to
enforce the limitations set forth in the first sentence of this Section
7.1(d).
7.2 Determinations
By the Board.
(a) All
matters concerning the determination and allocation among the Members of the
amounts to be determined and allocated pursuant to Article V hereof, including
any taxes thereon and accounting procedures applicable thereto, shall be
determined by the Board (either directly or by the Adviser, to the extent
consistent with its functions, pursuant to delegated authority) unless
specifically and expressly otherwise provided for by the provisions of this
Agreement or as required by law, and such determinations and allocations shall
be final and binding on all the Members.
-23-
(b) The Board
may make such adjustments to the computation of Net Profit or Net Loss or any
components (withholding any items of income, gain, loss or deduction) comprising
any of the foregoing as it considers appropriate to reflect fairly and
accurately the financial results of the Fund and the intended allocation thereof
among the Members.
7.3 Valuation
of Assets.
(a) Except as
may be required by the 1940 Act, the Board shall value or have valued any
Securities or other assets and liabilities of the Fund (other than assets
invested in Investment Funds) as of the close of business on the last day of
each Fiscal Period or more frequently, in the discretion of the Board, in
accordance with such valuation procedures as shall be established from time to
time by the Board and which conform to the requirements of the 1940
Act. Assets of the Fund invested in Investment Funds shall be valued
at fair value in accordance with procedures adopted by the Board. In
determining the value of the assets of the Fund, no value shall be placed on the
goodwill or name of the Fund, or the office records, files, statistical data or
any similar intangible assets of the Fund not normally reflected in the Fund’s
accounting records, but there shall be taken into consideration any items of
income earned but not received, expenses incurred but not yet paid, liabilities,
fixed or contingent, and any other prepaid expenses to the extent not otherwise
reflected in the books of account, and the value of options or commitments to
purchase or sell Securities or commodities pursuant to agreements entered into
prior to such valuation date.
(b) The value
of Securities and other assets of the Fund and the net worth of the Fund as a
whole determined pursuant to this Section 7.2 shall be conclusive and binding on
all of the Members and all parties claiming through or under them.
ARTICLE
VIII
MISCELLANEOUS
PROVISIONS
8.1 Amendment
of Limited Liability Company Agreement.
(a) Except as
otherwise provided in this Section 8.1, this Agreement may be amended, in whole
or in part, with the approval of (i) the Directors (including the vote of a
majority of the Independent Directors, if required by the 0000 Xxx) or (ii) a
majority (as defined in the 0000 Xxx) of the outstanding Voting Interests of the
Fund.
(b) Any
amendment that would:
|
(i)
|
increase
the obligation of a Member to make any contribution to the capital of the
Fund;
|
|
(ii)
|
reduce
the Capital Account of a Member other than in accordance with Article V;
or
|
-24-
|
(iii)
|
modify
the events causing the dissolution of the
Fund;
|
may be
made only if (i) the written consent of each Member adversely affected thereby
is obtained prior to the effectiveness thereof or (ii) such amendment does not
become effective until (A) each Member has received written notice of such
amendment (except an amendment contemplated in Section 8.1(c)(2) hereof) and (B)
any Member objecting to such amendment has been afforded a reasonable
opportunity (pursuant to such procedures as may be prescribed by the Board) to
tender his or her entire Interest for repurchase by the Fund.
(c) By way of
example only, the Board of Directors at any time without the consent of the
Members may:
|
(i)
|
restate
this Agreement together with any amendments hereto which have been duly
adopted in accordance herewith to incorporate such amendments in a single,
integrated document;
|
|
(ii)
|
amend
this Agreement (other than with respect to the matters set forth in
Section 8.1(b) hereof) to effect compliance with any applicable law or
regulation or to cure any ambiguity or to correct or supplement any
provision hereof which may be inconsistent with any other provision
hereof; and
|
|
(iii)
|
amend
this Agreement to make such changes as may be necessary or desirable,
based on advice of legal counsel to the Fund, to assure the Fund’s
continuing eligibility to be classified for U.S. Federal income tax
purposes as a partnership which is not treated as a corporation under
Section 7704(b) of the Code.
|
(d) The Board
shall give written notice of any proposed amendment to this Agreement to each
Member, which notice shall set forth (i) the text of the proposed amendment
or (ii) a summary thereof and a statement that the text thereof will be
furnished to any Member upon request.
8.2 Notices.
Notices
which may or are required to be provided under this Agreement shall be made, if
to a Member, by regular mail, hand delivery, registered or certified mail return
receipt requested, commercial courier service, telex, telecopier or other
electronic means, including e-mail, or, if to the Fund, by registered or
certified mail, return receipt requested, and shall be addressed to the
respective parties hereto at their addresses as set forth on the books and
records of the Fund (or to such other addresses as may be designated by any
party hereto by notice addressed to the Fund in the case of notice given to any
Member, and to each of the Members in the case of notice given to the
Fund). Notices shall be deemed to have been provided when delivered
by hand, on the date indicated as the date of receipt on a return receipt or
when received if sent by regular mail, e-mail, commercial courier service, telex
or telecopier. A document that is not a notice and that is required
to be provided under this Agreement by any party to another party may be
delivered by any reasonable means.
-25-
8.3 Agreement
Binding Upon Successors and Assigns.
This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective heirs, successors, assigns, executors, trustees or other
legal representatives, but the rights and obligations of the parties hereunder
may not be Transferred or delegated except as provided in this Agreement and any
attempted Transfer or delegation thereof which is not made pursuant to the terms
of this Agreement shall be void.
8.4 Applicability
of 1940 Act and Form N-2.
The
parties hereto acknowledge that this Agreement is not intended to, and does not
set forth the substantive provisions contained in the 1940 Act and the Form N-2
which affect numerous aspects of the conduct of the Fund’s business and of the
rights, privileges and obligations of the Members. Each provision of
this Agreement shall be subject to and interpreted in a manner consistent with
the applicable provisions of the 1940 Act and the Form N-2.
8.5 Choice of
Law.
(a) Notwithstanding
the place where this Agreement may be executed by any of the parties hereto, the
parties expressly agree that all the terms and provisions hereof shall be
construed under the laws of the State of Delaware, including the Delaware Act,
without regard to the conflict of law principles of such State.
(b) [Each
Member agrees to submit all controversies arising between or among Members or
one or more Members and the Fund in connection with the Fund or its businesses
or concerning any transaction, dispute or the construction, performance or
breach of this or any other agreement, whether entered into prior to, on or
subsequent to the date hereof, to arbitration in accordance with the provisions
set forth below. Each Member understands that:
|
(i)
|
arbitration
is final and binding on the
parties;
|
|
(ii)
|
the
parties are waiving their rights to seek remedies in court, including the
right to jury trial;
|
|
(iii)
|
pre-arbitration
discovery is generally more limited than and different from court
proceedings;
|
|
(iv)
|
the
arbitrator’s award is not required to include factual findings or legal
reasoning and a party’s right to appeal or to seek modification of rulings
by arbitrators is strictly limited;
and
|
|
(v)
|
a
panel of arbitrators will typically include a minority of arbitrators who
were or are affiliated with the securities
industry.
|
(c) [Controversies
shall be determined by arbitration before, and only before, an arbitration panel
convened in [Boston Massachusetts] by, to the fullest extent permitted by
law. Any arbitration under this Agreement shall be determined before
and in accordance with the rules then obtaining of either The New York Stock
Exchange, Inc. (“NYSE”) or the Financial Industry Regulatory Authority, Inc.
(“FINRA”). The parties may also select any other national
securities exchange’s arbitration forum upon which a party is legally required
to arbitrate the controversy, to the fullest extent permitted by
law. Such arbitration shall be governed by the rules of the
organization convening the panel, to the fullest extent permitted by
law. Judgment on any award of any such arbitration may be entered in
the Supreme Court of the Commonwealth of Massachusetts or in any other court
having jurisdiction over the party or parties against whom such award is
rendered. Each Member agrees that the determination of the
arbitrators shall be binding and conclusive upon them.]
-26-
(d) No Member
shall bring a putative or certified class action to arbitration, nor seek to
enforce any pre-dispute arbitration agreement against any person who has
initiated in court a putative class action or who is a member of a putative
class who has not opted out of the class with respect to any claims encompassed
by the putative class action unless and until: (i) the class certification is
denied; or (ii) the class is decertified; or (iii) the Member is excluded from
the class by the court. The forbearance to enforce an agreement to
arbitrate shall not constitute a waiver of any rights under this Agreement
except to the extent stated herein.
8.6 Not for
Benefit of Creditors.
The
provisions of this Agreement are intended only for the regulation of relations
among past, present and future Members, officers of the Fund, Directors, the
Adviser and the Fund. This Agreement is not intended for the benefit
of non-Member creditors and no rights are granted to non-Member creditors under
this Agreement (except as provided in Section 3.8).
8.7 Consents.
Any and
all consents, agreements or approvals provided for or permitted by this
Agreement shall be in writing and a signed copy thereof shall be filed and kept
with the books of the Fund.
8.8 Merger
and Consolidation.
(a) Notwithstanding
any other provision of this Agreement, the Fund may merge or consolidate with or
into one or more limited liability companies formed under the Delaware Act or
other business entities (as defined in Section 18-209(a) of the Delaware Act)
pursuant to an agreement of merger or consolidation which has been approved by a
majority of the Directors, without the consent of any other Member or person
being required.
(b) Notwithstanding
anything to the contrary contained elsewhere in this Agreement, an agreement of
merger or consolidation approved in accordance with Section 18-209(b) of the
Delaware Act may (i) effect any amendment to this Agreement, (ii) effect the
adoption of a new limited liability company agreement for the Fund if it is the
surviving or resulting limited liability company in the merger or consolidation,
or (iii) provide that the limited liability company agreement of any other
constituent limited liability company to the merger or consolidation (including
a limited liability company formed for the purpose of consummating the merger or
consolidation) shall be the limited liability company agreement of the surviving
or resulting limited liability company.
-27-
8.9 Pronouns.
All
pronouns shall be deemed to refer to the masculine, feminine, neuter, singular
or plural, as the identity of the person or persons, firm or corporation may
require in the context thereof.
8.10 Confidentiality.
(a) In
connection with the organization of the Fund and its ongoing business, the
Members will receive or have access to confidential proprietary information
concerning the Fund, including, without limitation, portfolio positions,
valuations, information regarding potential investments, financial information,
trade secrets and the like (the “Confidential Information”), which is
proprietary in nature and non-public. No Member, nor any affiliate of
any Member, shall disclose or cause to be disclosed any Confidential Information
to any person nor use any Confidential Information for its own purposes or its
own account, except in connection with its investment in the Fund and except as
otherwise required by any regulatory authority, law or regulation, or by legal
process.
(b) Each
Member recognizes that in the event that this Section 8.10 is breached by any
Member or any of its principals, partners, members, directors, officers,
employees or agents or any of its affiliates, including any of such affiliates’
principals, partners, members, directors, officers, employees or agents,
irreparable injury may result to the non-breaching Members and the
Fund. Accordingly, in addition to any and all other remedies at law
or in equity to which the non-breaching Members and the Fund may be entitled,
such members also shall have the right to obtain equitable relief, including,
without limitation, injunctive relief, to prevent any disclosure of Confidential
Information, plus reasonable attorneys’ fees and other litigation expenses
incurred in connection therewith.
(c) Notwithstanding
anything to the contrary in this Agreement: (i) the Fund, the Board
or the Adviser shall have the right to keep confidential from the Members for
such period of time as it deems reasonable any information which the Board or
the Adviser reasonably believes to be in the nature of trade secrets or other
information the disclosure of which the Board or the Adviser in good faith
believes is not in the best interest of the Fund or could damage the Fund or its
business or which the Fund is required by law or by agreement with a third party
to keep confidential; and (ii) each Member (and each employee, representative or
other agent of such Member) may disclose to any and all persons, without
limitation of any kind, the tax treatment and tax structure of (i) the Fund and
(ii) any of its transactions, and all materials of any kind (including opinions
or other tax analyses) that are provided to the Member relating to such tax
treatment and tax structure.
8.11 Certification
of Non-Foreign Status.
Unless
such certification is not deemed necessary by the Adviser, each Member or
transferee of an Interest from a Member that is admitted to the Fund in
accordance with this Agreement shall certify, upon admission to the Fund and at
such other time thereafter as the Board may request, whether he or she is a
“United States Person” within the meaning of Section 7701(a)(30) of the Code on
forms to be provided by the Fund, and shall notify the Fund within 30 days of
any change in such Member’s status. Any Member who shall fail to
provide such certification when requested to do so by the Board may be treated
as a non-United States Person for purposes of U.S. Federal tax
withholding.
-28-
8.12 Severability.
If any
provision of this Agreement is determined by a court of competent jurisdiction
not to be enforceable in the manner set forth in this Agreement, each Member
agrees that it is the intention of the Members that such provision should be
enforceable to the maximum extent possible under applicable law. If
any provisions of this Agreement are held to be invalid or unenforceable, such
invalidation or unenforceability shall not affect the validity or enforceability
of any other provision of this Agreement (or portion thereof).
8.13 Entire
Agreement.
This
Agreement (including the Schedule attached hereto which is incorporated herein)
constitutes the entire agreement among the parties hereto pertaining to the
subject matter hereof and supersedes all prior agreements and understandings
pertaining thereto. It is hereby acknowledged and agreed that the
Board, without the approval of any Member may enter into written agreements
(“Other Agreements”) with Members, executed contemporaneously with the admission
of such Members to the Fund, effecting the terms hereof or of any application in
order to meet certain requirements of such Members. The parties
hereto agree that any terms contained in an Other Agreement with a Member shall
govern with respect to such Member notwithstanding the provisions of this
Agreement or of any application.
8.14 Discretion.
Notwithstanding
anything to the contrary in this Agreement or any agreement contemplated herein
or in any provisions of law or in equity, whenever in this Agreement, a person
is permitted or required to make a decision (i) in its “sole discretion” or
“discretion” or under a grant of similar authority or latitude, such person
shall be entitled to consider only such interests and factors as it desires,
including its own interests, and shall, to the fullest extent permitted by law,
have no duty or obligation to give any consideration to any interest of or
factors affecting the Fund or the Members, or (ii) in its “good faith” or under
another express standard, then such person shall act under such express
standard.
8.15 Counterparts.
This
Agreement may be executed in several counterparts, all of which together shall
constitute one agreement binding on all parties hereto, notwithstanding that all
the parties have not signed the same counterpart. This Agreement may
also be executed by the execution of the signature page of the Fund’s “Investor
Questionnaire and Subscription Agreement” or similar instrument with the same
effect as if the parties executing the signature page to the “Investor
Questionnaire and Subscription Agreement,” or similar instrument, had all
executed one counterpart of this Agreement.
8.16 Tax
Matters Partner.
The
Adviser hereby is designated as the “tax matters partner” under the Code for the
Fund.
-29-
8.17 Section
754 Election.
In the
event of a distribution of Fund property to a Member or an assignment or other
transfer (including by reason of death) of all or part of the interest of a
Member in the Fund, the Board of Directors, in its discretion, may
cause the Fund to elect, pursuant to Section 754 of the Code, or the
corresponding provision of subsequent law, to adjust the basis of
the Fund's property as provided by Sections 734 and 743 of the
Code.
8.18 Member
Tax Basis.
Upon
request of the Board of Directors, each Member agrees to provide to the Board of
Directors information regarding its adjusted tax basis in its interest in
the Fund along with documentation substantiating such amount.
THE
UNDERSIGNED ACKNOWLEDGES HAVING READ THIS AGREEMENT IN ITS ENTIRETY BEFORE
SIGNING, INCLUDING THE PRE-DISPUTE ARBITRATION CLAUSES SET FORTH IN SECTION 8.5
ON PAGES [______] AND THE CONFIDENTIALITY CLAUSES SET FORTH IN SECTION 8.10 ON
PAGE [____].
[Remainder
of Page Intentionally Blank – Signature Page Follows]
-30-
IN WITNESS WHEREOF, the
undersigned have executed this Agreement as of the day and year first above
written.
ORGANIZATIONAL
MEMBER:
______________________________
Xxxxx X.
Xxxxxxx
SCS
CAPITAL MANAGEMENT, LLC, as Adviser [and Member]
By:
___________________________
Name:
Xxxxx X. Xxxxxxx
Title: [President]
ADDITIONAL
MEMBERS:
Each
person who has signed or has had signed on its behalf a Member Signature Page or
Investor Questionnaire and Subscription Agreement, which shall constitute a
counterpart hereof.
The
undersigned understand and agree to the provisions of this Agreement pertaining
to the obligations of Directors.
______________________________
Xxxxx X.
Xxx III, Director
______________________________
Xxxxxx X.
Xxxxxxx, Director
______________________________
Xxxxx
Xxxxxxx, Director
______________________________
Xxxxx X.
Xxxxxxx, Director
______________________________
Xxxxxx X
XxXxxxx
[Signature Page to Limited Liability Company
Agreement]
SCHEDULE
I
|
Name/Title
|
Address
|
|
Xxxxx
X. Xxx III
Director
|
|
|
Xxxxxx
X. Xxxxxxx
Director
|
|
|
Xxxxx
Xxxxxxx
Director
|
|
|
Xxxxx
X. Xxxxxxx
Director
|
|
|
Xxxxxx
X XxXxxxx
Director
|
- I-1 -
