EXHIBIT 99.B2(k)(ii)
ESCROW AGREEMENT
THIS AGREEMENT is made as of December 20, 2002, by and among COLUMBIA
MANAGEMENT MULTI-STRATEGY HEDGE FUND, LLC, a Delaware limited liability company
(the "Fund"), Columbia Management Company, an Oregon corporation (the
"Manager"), and PFPC INC., a Massachusetts corporation ("Escrow Agent").
WITNESSETH
WHEREAS, the Fund has retained PFPC Inc. to provide certain administration,
accounting and investor services pursuant to an Administration, Accounting and
Investor Services Agreement dated as of December 20, 2002; and
WHEREAS, the Fund desires that PFPC Inc. also provide services as escrow
agent for the purpose of receiving payments from potential subscribing members
in the Fund (the "Potential Investors") and PFPC Inc. wishes to provide such
services.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the parties hereto agree as follows:
1. ACCEPTANCE BY ESCROW AGENT. The Escrow Agent hereby accepts the appointment
as escrow agent hereunder and agrees to act on the terms and conditions
hereinafter set forth.
2. RIGHTS AND RESPONSIBILITIES OF ESCROW AGENT. The acceptance by the Escrow
Agent of its duties hereunder is subject to the following terms and
conditions, which the parties to this Agreement hereby agree shall govern
and control the Escrow Agent's rights, duties, liabilities and immunities.
(a) The Escrow Agent shall act hereunder as a depositary only, and in
its capacity as
such, it shall not be responsible or liable in any manner whatever
for the sufficiency, correctness, genuineness or validity of any
document furnished to the Escrow Agent or any asset deposited with
it.
(b) "Written Instructions" means written instructions received by the
Escrow Agent and signed by the Manager or any other person duly
authorized by the Manager, or by the members of the Fund, to give
such instructions on behalf of the Fund. The instructions may be
delivered by hand, mail, facsimile, cable, telex or telegram; except
that any instruction terminating this Agreement may be given only by
hand or mail. The Fund shall file from time to time with the Escrow
Agent a certified copy certified by the Manager of each resolution
of the Manager or members authorizing the person or persons to give
Written Instructions. Such resolution shall include certified
signatures of such persons authorized to give Written Instructions.
This shall constitute conclusive evidence of the authority of the
signatories designated therein to act. Such resolution shall be
considered in full force and effect with the Escrow Agent fully
protected in acting in reliance thereon unless and until it receives
written notice from the Manager to the contrary.
The Escrow Agent may rely upon and shall be protected for any action
or omission it takes pursuant to Written Instructions if it, in good
faith, believes such Written Instructions to be genuine. Unless
otherwise provided in this Agreement, the Escrow Agent shall act
only upon Written Instructions. The Escrow Agent shall be entitled
to assume that any Written Instruction received hereunder is not
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in any way inconsistent with the provisions of the limited liability
company agreement (the "LLC Agreement") or this Agreement or of any
vote, resolution or proceeding of the Fund's members, unless and
until the Escrow Agent receives Written Instructions to the
contrary.
(c) The Escrow Agent shall be obligated to exercise care and diligence
in the performance of its duties hereunder, to act in good faith and
to use its best efforts, within reasonable limits, in performing
services provided for under this Agreement. The Escrow Agent shall
be liable for any damages arising out if its failure to perform its
duties under this Agreement to the extent such damages arise out of
its willful misfeasance, fraud, bad faith, negligence or reckless
disregard of such duties.
(d) Notwithstanding anything in this Agreement to the contrary, neither
the Escrow Agent nor its affiliates shall be liable to the Fund or
the Manager for any consequential, special or indirect losses or
damages which the Fund may incur or suffer by or as a consequence of
the Escrow Agent's or its affiliates' performance of the services
provided hereunder, whether or not the likelihood of such losses or
damages was known by the Escrow Agent or its affiliates.
(e) Without limiting the generality of the foregoing or of any other
provision of this Agreement, the Escrow Agent shall not be liable
for losses beyond its control, provided it has acted in accordance
with the standard of care set forth above; and the Escrow Agent
shall not be liable for delays or errors or loss of data occurring
by reason of circumstances beyond its control, including acts of
civil or military
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authority, national emergencies, labor difficulties, fire, flood,
catastrophe, acts of God, insurrection, war, riots or failure of the
mails, transportation, communication or power supply.
(f) The Fund agrees to indemnify the Escrow Agent and hold it harmless
from and against any tax, charge, loss, liability, expense
(including reasonable attorneys fees and expenses), claim or demand
arising directly or indirectly from any action or omission to act
which the Escrow Agent takes (i) at the request or on the direction
of or in reliance on the advice of the Fund or (ii) upon Written
Instructions; provided, however, that neither the Escrow Agent, nor
any of its affiliates, shall be indemnified against any liability
(or any expenses incident to such liability) arising out of the
Escrow Agent's or its affiliates own willful misfeasance, bad faith,
negligence or reckless disregard of its duties and obligations under
this Agreement. The Fund shall indemnify and hold harmless the
Escrow Agent against and in respect of any liability for taxes and
for any penalties or interest in respect of taxes attributable to
the investment of funds held in escrow by the Escrow Agent pursuant
to this Agreement. Notwithstanding anything in this Agreement to the
contrary, the Fund shall not be liable to the Escrow Agent for any
consequential, special or indirect losses or damages which the
Escrow Agent may incur or suffer, whether or not the likelihood of
such losses or damages was known by the Fund. These indemnities
shall survive the resignation of the Escrow Agent or the termination
of this Agreement.
(g) The Escrow Agent shall have no duties except those specifically set
forth in this
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Agreement.
(h) The Escrow Agent shall have the right at any time it deems
appropriate to seek an adjudication in a court of competent
jurisdiction as to the respective rights of the parties hereto and
shall not be held liable by any party hereto for any delay or the
consequences of any delay occasioned by such resort to court.
(i) The Escrow Agent shall notify promptly the Manager of any
discrepancy between the amounts set forth on any remittance advice
received by Escrow Agent and the sums delivered to it therewith.
3. DEFINITIONS. Except as specifically set forth herein, the terms used in
this Agreement shall have the same meaning as set forth in the
Administration, Accounting and Investor Services Agreement between the Fund
and PFPC Inc.
4. DEPOSIT OF ESCROW FUND. The Escrow Agent shall establish an account in the
name of Columbia Management Multi-Strategy Hedge Fund, LLC Escrow Account
for the Benefit of Investors (the "Subscription Account") and an account in
the name of Columbia Management Multi-Strategy Hedge Fund, LLC Repurchase
Account (the "Repurchase Account") and together with the Subscription
Account, the "Accounts"). The Escrow Agent shall promptly deposit in the
Subscription Account checks remitted by Potential Investors and made
payable to the Fund. Potential Investors also may deposit monies in the
Subscription Account by wire transfer pursuant to instructions provided to
them by the Fund. Balances on deposit in the Subscription Account will earn
interest at prevailing market rates pursuant to arrangements approved by
the Fund.
5. STATEMENTS. During the term of this Agreement, the Escrow Agent shall
provide the
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Fund with (a) monthly statements containing the beginning balance in each
Account as well as all principal and income transactions for the statement
period and (b) a daily summary of amounts deposited and the status of
available funds. The Fund shall be responsible for reconciling such
statements. The Escrow Agent shall be forever released and discharged from
all liability with respect to the accuracy of such statements, except with
respect to any such act or transaction as to which the Fund shall, within
90 days after the furnishing of the statement, file written objections with
the Escrow Agent.
6. DISTRIBUTIONS AND CLOSINGS. Upon Written Instructions, at each closing of
each offering of interests in the Fund, the Escrow Agent will wire
principal balances on deposit in the Subscription Account to the account
designated by the Fund. Such Written Instructions shall be sent to the
Escrow Agent by 2:00 p.m. on the closing date with respect to each closing.
In the event that a Potential Investor who has escrow funds in the
Subscription Account is not admitted into the Fund, upon Written
Instructions, the Escrow Agent shall promptly issue refunds to the
Potential Investor in the amount of the principal balance with accrued
interest. Such refunds shall be made in check form.
7. INTEREST. All interest earned on the escrow funds deposited in the Accounts
hereunder shall be added to and held in the Accounts. With respect to each
closing, pursuant to Written Instructions, within 5 business days of the
crediting of such Interest the Escrow Agent shall issue interest payments
in check form to each Potential Investor based on his or her individual
balance in the Subscription Account along with a cover letter and to the
Manager based upon its balance in the Subscription Account along with a
cover letter. The Escrow Agent will prepare and send notifications on Form
1099 for each calendar
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year.
8. REPURCHASES. The Fund from time to time may wire balances to the Repurchase
Account in connection with periodic repurchases of interests by the Fund
from its members. Upon Written Instructions, the Escrow Agent shall issue
promptly repurchase payments from the Repurchase Account in check form to
the repurchasing member or to the Manager, as the case may be. Upon Written
Instructions, the Escrow Agent will withhold specified amounts from
repurchasing members. Any interest earned thereon will be credited to the
accounts of the Fund.
9. TAX IDENTIFICATION NUMBER. All deposits to the Accounts shall be subject to
the Escrow Agent's receipt of a valid tax identification number for the
Fund, Manager or Potential Investor, as applicable.
10. COMPENSATION. The fee of the Escrow Agent for its services hereunder shall
be paid by the Fund as may be mutually agreed to in writing by the Fund and
Escrow Agent. Notwithstanding the foregoing, standard account transaction
charges will be billed to the Fund as an out-of-pocket expense.
11. AMENDMENT. This Agreement may not be amended or supplemented, and no
provision hereof may be modified or waived, except by an instrument in
writing, signed by all of the parties hereto.
12. TERMINATION. This Agreement shall continue until terminated by either party
on 60 days' prior written notice. Upon the termination of this Agreement
and upon the delivery of the balance of the Accounts to a successor escrow
agent or such other person as may be designated by Written Instructions,
the Escrow Agent shall be released and discharged of
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any and all further obligations hereunder.
If no successor Escrow Agent has been designated pursuant to Written
Instructions to receive the balance of the Accounts at the expiration of
the 60-day period, the Escrow Agent shall have no further obligation
hereunder except to hold the escrow funds as a depositary. Upon written
notification by the Fund of the appointment of the successor, the Escrow
Agent shall promptly deliver the balance of the Accounts to such successor,
and the duties of the resigning Escrow Agent shall thereupon in all
respects terminate, and it shall be released and discharged of any and all
further obligations hereunder.
13. EXECUTION. This Agreement may be executed in several counterparts, each of
which shall be deemed an original, but such counterparts together shall
constitute one and the same instrument.
14. MISCELLANEOUS. All covenants and agreements contained in this Agreement by
or on behalf of the parties hereto shall bind and inure to the benefit of
such parties and their respective heirs, administrators, legal
representatives, successors and assigns, as the case may be. The headings
in this Agreement are for convenience of reference only and shall neither
be considered as part of this Agreement, nor limit or otherwise affect the
meaning thereof. This Agreement shall be construed and enforced in
accordance with the laws of Massachusetts without regard to principles of
conflicts of law.
15. NOTICES. All instructions, notices and other communications hereunder must
be in writing and shall be deemed to have been duly given if delivered by
hand or facsimile or mailed by first class, registered mail, return receipt
requested, postage prepaid, and addressed as follows:
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(a) If to the Fund:
Columbia Management Multi-Strategy Hedge Fund, LLC
X/X Xxxxxxx Xxxxx
000 Xxxxxxx Xxxxxx, 0xx Xxxxx
Mailstop: MADE 10003D
Xxxxxx, XX 00000
(b) If to the Escrow Agent:
PFPC Inc.
Attn: Xxxx X. Xxxxxxx
000 Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
(c) If to the Manager:
c/o Xxxx Xxxxx
Columbia Management Company
One Financial Center, 9th Floor
Mail Stop: MA DE 11509A
Xxxxxx, XX 00000
16. PARTIAL INVALIDITY. If any provision of this Agreement shall be held or
made invalid by a court decision, statute, rule or otherwise, the remainder
of this Agreement shall not be affected thereby.
17. ENTIRE AGREEMENT. This Agreement embodies the entire agreement and
understanding among the parties and supersedes all prior agreements and
understandings relating to the subject matter hereof; provided that, the
parties may embody in one or more separate documents their agreement, if
any, with respect to delegated duties and instructions.
[Signature Page Follows]
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IN WITNESS THEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
COLUMBIA MANAGEMENT MULTI-STRATEGY
HEDGE FUND, LLC
By: /s/ Xxxxx Xxxxxxxxxxx
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Name: Xxxxx Xxxxxxxxxxx
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Title: Treasurer
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COLUMBIA MANAGEMENT COMPANY (as "Manager")
By: /s/ Xxxxx Xxxxxxxxxxx
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Name: Xxxxx Xxxxxxxxxxx
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Title:
----------------------------
PFPC INC.
By: /s/ Xxxx Xxxxxxx
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Name: Xxxx Xxxxxxx
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Title:
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