ROCHDALE CORE ALTERNATIVE STRATEGIES FUND INVESTMENT ADVISORY AGREEMENT
ROCHDALE CORE ALTERNATIVE STRATEGIES FUND
THIS AGREEMENT is made and entered into as of this 2nd day of July 2012, by and among ROCHDALE CORE ALTERNATIVE STRATEGIES FUND TEI, LLC, a Delaware limited liability company (the “Tax-Exempt Fund”), ROCHDALE CORE ALTERNATIVE STRATEGIES FUND, LLC, a Delaware limited liability company (the “Taxable Fund”), ROCHDALE CORE ALTERNATIVE STRATEGIES FUND (CAYMAN), LTD, a Cayman Islands limited duration company (the “Offshore Fund”), ROCHDALE CORE ALTERNATIVE STRATEGIES MASTER FUND, LLC, a Delaware limited liability company (the “Master Fund”), and Rochdale Investment Management, a Delaware limited liability company (the “Advisor” or “Rochdale”). The Tax-Exempt Fund, the Taxable Fund, the Offshore Fund and the Master Fund are sometimes referred to herein collectively the “Funds”.
WHEREAS, the Advisor, or its predecessors, have continuously provided investment advisory services to the Funds since their inception pursuant to the terms of an investment advisory agreement that first became effective on March 15, 2007 (the “Prior Agreement”); and
1. Appointment of Advisor. The Funds hereby employs the Advisor and the Advisor hereby accepts such employment, to render investment advice and related services with respect to the assets of the Funds for the period and on the terms set forth in this Agreement, subject to the supervision and direction of the Funds’ Board of Directors.
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Without limiting the generality of the foregoing, the Advisor shall: (i) furnish the Master Fund with advice and recommendations with respect to the investment of the Master Fund’s assets and the purchase and sale of portfolio securities for the Master Fund including the taking of such steps as may be necessary to implement such advice and recommendations (i.e., placing the orders); (ii) manage and oversee the investments of the Master Fund, subject to the ultimate supervision and direction of the Master Fund’s Board of Directors; (iii) vote proxies for the Master Fund (if applicable), file Section 13 ownership reports for the Funds, and take other actions on behalf of the Funds; (iv) maintain the books and records required to be maintained by each Fund except to the extent arrangements have been made for such books and records to be maintained by the administrator or another agent of the Fund; (v) furnish such reports, statements and other data on securities, economic conditions and other matters related to the investment of each Fund’s assets as may be reasonably requested by the Funds; and (vi) render to the Funds’ Boards of Directors such periodic and special reports with respect to each Fund’s investment activities as the Board may reasonably request, including at least one in-person appearance annually before the Boards of Directors.
Subject to such policies as the Board of Directors of the Master Fund may determine, the Advisor shall not be deemed to have acted unlawfully or to have breached any duty created by this Agreement or otherwise solely by reason of its having caused Master Fund to pay a broker or dealer that provides (directly or indirectly) brokerage or research services to the Advisor an amount of commission for effecting a portfolio transaction in excess of the amount of commission another broker or dealer would have charged for effecting that transaction, if the Advisor determines in good faith that such amount of commission was reasonable in relation to the value of the brokerage and research services provided by such broker or dealer, viewed in terms of either that particular transaction or the Advisor’s overall responsibilities with respect to the Master Fund. The Advisor is further authorized to allocate the orders placed by it on behalf of the Master Fund to such brokers or dealers who also provide research or statistical material, or other services, to the Fund, the Advisor, or any affiliate of either. Such allocation shall be in such amounts and proportions as the Advisor shall determine, and the Advisor shall report on such allocations regularly to the Master Fund, indicating the broker-dealers to whom such allocations have been made and the basis therefor.
On occasions when the Advisor deems the purchase or sale of a security to be in the best interest of one or more of the Funds as well as of other clients, the Advisor, to the extent permitted by applicable laws and regulations, may aggregate the securities to be so purchased or sold. In such event, allocation of the securities so purchased or sold, as well as the expenses incurred in the transaction, will be made by the Advisor in the manner it considers to be the most equitable and consistent with its fiduciary obligations to the Funds and to such other clients.
(a) The Advisor shall use its best judgment and efforts in rendering the advice and services to the Funds as contemplated by this Agreement.
(b) The Advisor shall maintain all licenses and registrations necessary to perform its duties hereunder in good order.
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(c) In performance of its duties hereunder, the Advisor shall conduct its operations at all times in conformance with the Investment Advisers Act of 1940, the Investment Company Act of 1940, and any other applicable state and/or self-regulatory organization regulations.
(a) With respect to the operation of the Funds, the Advisor shall be responsible for (i) providing the personnel, office space and equipment reasonably necessary for the maintenance of the Funds’ principal office, (ii) the expenses associated with the performance of its services hereunder, other than the expenses assumed by other service providers to the Fund (including affiliates of the Advisor); and (iii) the costs of any special Board of Directors meetings or shareholder meetings convened for the primary benefit of the Advisor. If the Advisor has agreed to limit the operating expenses of the Funds, the Advisor shall also be responsible on a monthly basis for any operating expenses that exceed the agreed upon expense limit.
(b) The Funds are responsible for and have assumed the obligation for payment of all of its expenses, other than as stated in Subparagraph 6(a) above, including but not limited to: fees and expenses incurred in connection with the issuance, registration and transfer of its shares; brokerage and commission expenses; all expenses of transfer, receipt, safekeeping, servicing and accounting for the cash, securities and other property of the Funds for the benefit of the Funds including all fees and expenses of its custodian, shareholder services agent and accounting services agent; interest changes on any borrowings; costs and expenses of pricing and calculating its daily net asset value and of maintaining its books of account required under the Investment Company Act; taxes, if any; a pro rata portion of expenditures in connection with meetings of the Funds’ shareholders and the Fund’s Board of Directors that are properly payable by the Funds; salaries and expenses of officers and fees and expenses of members of the Funds’ Boards of Directors or members of any advisory board or committee who are not members of, affiliated with or interested persons of the Advisor; insurance premiums on property or personnel of each Fund which inure to its benefit, including liability and fidelity bond insurance; the cost of preparing and printing reports, proxy statements, prospectuses and statements of additional information of the Funds or other communications for distribution to existing shareholders; legal, auditing and accounting fees; trade association dues; fees and expenses (including legal fees) of registering and maintaining registration of its shares for sale under federal and applicable state and foreign securities laws; all expenses of maintaining and servicing shareholder accounts, including all charges for transfer, shareholder recordkeeping, dividend disbursing, redemption, and other agents for the benefit of the Funds, if any; and all other charges and costs of its operation plus any extraordinary and non-recurring expenses, except as herein otherwise prescribed.
(c) The Advisor may voluntarily absorb certain Fund expenses or waive the Advisor’s own advisory fee.
(d) To the extent the Advisor incurs any costs by assuming expenses which are an obligation of a Fund as set forth herein, the Fund shall promptly reimburse the Advisor for such costs and expenses, except to the extent the Advisor has otherwise agreed to bear such expenses. To the extent the services for which the Funds are obligated to pay hereunder are performed by the Advisor, the Advisor shall be entitled to recover from the Funds to the extent of the Advisor’s actual costs for providing such services. In determining the Advisor’s actual costs, the Advisor may take into account an allocated portion of the salaries and overhead of personnel performing such services.
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(a) Substantially all of the assets of the Funds shall be maintained in the Master Fund. If assets are held in one of the other Funds, they shall be included as total assets in the Master Fund for Investment Advisory and Management Fee calculation purposes.
(b) The Funds shall pay to the Advisor, and the Advisor agrees to accept, as full compensation for all investment management and advisory services furnished or provided to the Funds pursuant to this Agreement, an annual management fee or 1.25%, computed on the value of the net assets of the Funds as of the close of business each day.
(c) The management fee shall be accrued daily and paid to the Advisor on or before the tenth business day of the succeeding month.
(d) The initial management fee under this Agreement shall be payable on or before the tenth business day of the first month following the effective date of this Agreement and shall be prorated as set forth below. If this Agreement is terminated prior to the end of any month, the management fee to the Advisor shall be prorated for the portion of any month in which this Agreement is in effect which is not a complete month according to the proportion which the number of calendar days in the month during which the Agreement is in effect bears to the number of calendar days in the month, and shall be payable within ten (10) days after the date of termination.
(e) In addition to the management fee, the Funds shall pay to the Advisor a Performance fee in accordance with Schedule 2 of the Sub-Investment Advisory Agreement between Rochdale and AIG, as long as the Sub Investment Advisory Agreement is approved by the Boards of Directors and the Sub-Investment Advisory Agreement remains in effect and is not terminated or changed.
(f) The fee payable to the Advisor under this Agreement will be reduced to the extent of any receivable owed by the Advisor to the Funds and as required under any expense limitation applicable to the Funds.
(g) The Advisor voluntarily may reduce any portion of the compensation or reimbursement of expenses due to it pursuant to this Agreement and may agree to make payments to limit the expenses which are the responsibility of the Funds under this Agreement. Any such reduction or payment shall be applicable only to such specific reduction or payment and shall not constitute an agreement to reduce any future compensation or reimbursement due to the Advisor hereunder or to continue future payments.
(h) Any fee withheld or voluntarily reduced and any Fund expense absorbed by the Advisor voluntarily or pursuant to an agreed upon expense cap or under this Agreement, shall be reimbursed by the Fund to the Advisor, if so requested by the Advisor, in the first, second or third (or any combination thereof) fiscal year next succeeding the fiscal year of the withholding, reduction or absorption if the aggregate amount actually paid by the Funds toward the operating expenses for such fiscal year (taking into account the reimbursement) do not exceed the applicable limitation on the Funds’ expenses. Such reimbursement may be paid prior to the Funds’ payment of current expenses if so requested by the Advisor even if such practice may require the Advisor to waive, reduce or absorb current Fund expenses.
(i) The Advisor may agree not to require payment of any portion of the compensation or reimbursement of expenses otherwise due to it pursuant to this Agreement. Any such agreement shall be applicable only with respect to the specific items covered thereby and shall not constitute an agreement not to require payment of any future compensation or reimbursement due to the Advisor hereunder.
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(a) The Advisor shall have responsibility for the accuracy and completeness (and liability for the lack thereof) of the statements in the Funds’ offering materials (including the prospectuses, the statements of additional information, advertising and sales materials), except for information supplied by the administrator or the Funds or another third party for inclusion therein.
(b) The Advisor shall be liable to the Funds for any loss (including brokerage charges) incurred by the Funds as a result of any improper investment made by the Advisor.
(c) In the absence of willful misfeasance, bad faith, gross negligence, or reckless disregard of the obligations or duties hereunder on the part of the Advisor, the Advisor shall not be subject to liability to the Funds or to any shareholder of the Funds for any act or omission in the course of, or connected with, rendering services hereunder or for any losses that may be sustained in the purchase, holding or sale of any security by the Funds.
(d) Each party to this Agreement shall indemnify and hold harmless the other party and the shareholders, directors, officers and employees of the other party (any such person, an “Indemnified Party”) against any loss, liability, claim, damage or expense (including the reasonable cost of investigating and defending any alleged loss, liability, claim, damage or expenses and reasonable counsel fees incurred in connection therewith) arising out of the Indemnified Party’s performance or non-performance of any duties under this Agreement provided, however, that nothing herein shall be deemed to protect any Indemnified Party against any liability to which such Indemnified Party would otherwise be subject by reason of willful misfeasance, bad faith or gross negligence in the performance of duties hereunder or by reason of reckless disregard of obligations and duties under this Agreement.
(e) No provision of this Agreement shall be construed to protect any Director or officer of the Funds, or officer of the Advisor, from liability in violation of Sections 17(h) and (i) of the Investment Company Act.
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13. Sub-Advisor. The Advisor may contract with third parties to take on adviser responsibilities for a fee, with the approval of the Board of Directors of the Funds. In the event of a Sub-Advisor relationship, the Advisor will maintain its responsibilities under this agreement, the prospectuses any other applicable agreements and any federal or state regulations. The Advisor will submit to the Boards of Directors of the Funds a Sub-Investment Advisory Agreement for approval.
(a) This Agreement shall become effective as of the date first written above and shall remain in effect for a period of two (2) years, unless sooner terminated as hereinafter provided. This Agreement shall continue in effect thereafter for additional periods not exceeding one (1) year so long as such continuation is approved for the Funds at least annually by (i) the Boards of Directors of the Funds or by the vote of a majority of the outstanding voting securities of each Fund and (ii) the vote of a majority of the Directors of the Funds who are not parties to this Agreement nor interested persons thereof, cast in person at a meeting called for the purpose of voting on such approval. The terms “majority of the outstanding voting securities,” “assignment” and “interested persons” shall have the meanings as set forth in the Investment Company Act.
(b) The Funds may use the name “Rochdale” or any name derived from or using the name “Rochdale” only for so long as this Agreement or any extension, renewal or amendment hereof remains in effect. Within sixty (60) days from such time as this Agreement shall no longer be in effect, the Funds shall cease to use such a name or any other name connected with the Advisor.
(a) This Agreement may be terminated by the Funds at any time without payment of any penalty, by the Boards of Directors of the Funds or by vote of a majority of the outstanding voting securities of the Funds, upon sixty (60) days’ written notice to the Advisor, and by the Advisor upon sixty (60) days’ written notice to the Funds. In the event of a termination, the Advisor shall cooperate in the orderly transfer of the Funds’ affairs and, at the request of the Board of Directors, transfer any and all books and records of the Funds maintained by the Advisor on behalf of the Funds.
(b) This Agreement shall terminate automatically in the event of any assignment hereof, as defined in the Investment Company Act.
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19. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware without giving effect to the conflict of laws principles thereof; provided that nothing herein shall be construed to preempt, or to be inconsistent with, any federal law, regulation or rule, including the Investment Company Act and the Investment Advisers Act of 1940 and any rules and regulations promulgated thereunder.
ROCHDALE CORE ALTERNATIVE
STRATEGIES FUND, LLC
By: /s/ Xxxxxxx X'Xxxxxxxxxx
Name: Xxxxxxx X'Xxxxxxxxxx
Title: President
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ROCHDALE CORE ALTERNATIVE
STRATEGIES FUND TEI, LLC
By: /s/ Xxxxxxx X'Xxxxxxxxxx
Name: Xxxxxxx X'Xxxxxxxxxx
Title: President
ROCHDALE CORE ALTERNATIVE
STRATEGIES MASTER FUND, LLC
By: /s/ Xxxxxxx X'Xxxxxxxxxx
Name: Xxxxxxx X'Xxxxxxxxxx
Title: President
ROCHDALE CORE ALTERNATIVE
STRATEGIES FUND (Cayman), LDC
By: Rochdale Core Alternative Strategies Fund TEI LLC
By: /s/ Xxxxxxx X'Xxxxxxxxxx
Name: Xxxxxxx X'Xxxxxxxxxx
Title: President
ROCHDALE INVESTMENT MANAGEMENT
By: /s/ Xxxx Xxxxxxxxxxx
Name: Xxxx Xxxxxxxxxxx
Title: Executive Vice President
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