Exhibit G
MANAGEMENT AGREEMENT
THIS MANAGEMENT AGREEMENT is made and executed the 23rd day of April,
2007, by and between Excelsior Directional Hedge Funds of Fund (TI), LLC, a
Delaware limited liability company (the "Company"), and U.S. Trust Hedge Fund
Management, Inc., a North Carolina corporation ("HFM").
WHEREAS, the Company is registered with the Securities and Exchange
Commission (the "Commission") under the Investment Company Act of 1940, as
amended (the "1940 Act"), as a closed-end, non-diversified management investment
company, and HFM is an investment adviser registered as such under with the
Commission under the Investment Advisers Act of 1940; and
WHEREAS, the Company desires to retain HFM to provide various
management and administrative services to the Company pursuant to this
Agreement; and
WHEREAS, HFM desires to be retained to provide various management and
administrative services to the Company pursuant to this Agreement;
NOW, THEREFORE, in consideration of the terms and conditions
hereinafter set forth, it is agreed, by and between the parties, as follows:
1. The Company hereby retains HFM to:
(a) provide, and HFM hereby agrees to provide, certain
management, administrative and other services to the Company. Notwithstanding
the appointment of HFM to provide such services hereunder, the Board shall
remain responsible for supervising and controlling the management, business and
affairs of the Company. The management, administrative and other services to be
provided by HFM shall include:
(i) providing office space, telephone and utilities;
(ii) providing administrative and secretarial, clerical
and other personnel as necessary to provide the
services required to be provided under this
Agreement;
(iii) supervising the entities which are retained by the
Company to provide administration, custody and other
services to the Company;
(iv) handling investor inquiries regarding the Company
and providing investors with information concerning
their investments in the Company and capital account
balances;
(v) monitoring relations and communications between
investors and the Company;
(vi) assisting in the drafting and updating of disclosure
documents relating to the Company and assisting in
the preparation of offering materials;
(vii) maintaining and updating investor information, such
as change of address and employment;
(viii) assisting in the preparation and mailing of investor
subscription documents and confirming the receipt of
such documents and funds;
(ix) assisting in the preparation of regulatory filings
with the Securities and Exchange Commission and
state securities regulators and other Federal and
state regulatory authorities;
(x) preparing reports to and other informational
materials for members and assisting in the
preparation of proxy statements and other member
communications;
(xi) monitoring compliance with regulatory requirements
and with the Company's investment objective,
policies and restrictions as established by the
Board;
(xii) reviewing accounting records and financial reports
of the Company, assisting with the preparation of
the financial reports of the Company and acting as
liaison with the Company's accounting agent and
independent auditors;
(xiii) assisting in the preparation and filing of tax
returns;
(xiv) coordinating and organizing meetings of the Board
and meetings of the members of the Company, in each
case when called by such persons;
(xv) preparing materials and reports for use in
connection with meetings of the Board;
(xvi) maintaining and preserving those books and records
of the Company not maintained by any Sub-advisers
(as defined in Paragraph 2 below) of the Company or
the Company's administrator, accounting agent or
custodian (which books and records shall be the
property of the Company and maintained and preserved
as required by the 1940 Act and the rules thereunder
and shall be surrendered to the Company promptly
upon request);
(xvii) reviewing and arranging for payment of the expenses
of the Company;
2
(xviii) assisting the Company in conducting offers to
members of the Company to repurchase member
interests;
(xix) reviewing and approving all regulatory filings
of the Company required under applicable law;
(xx) reviewing investor qualifications and
subscription documentation and otherwise
assisting in administrative matters relating to
the processing of subscriptions for interests in
the Company;
(xxi) providing the services of persons employed by
HFM or its affiliates who may be appointed as
officers of the Company by the Board; and
(xxii) assisting the Company in routine regulatory
examinations, and working closely with any
counsel retained to represent the members of the
Board who are not "interested persons," as
defined by the 1940 Act and the rules thereunder
(the "Independent Managers") of the Company in
response to any litigation, investigations or
regulatory matters.
(b) invest excess cash of the Company as HFM, in its discretion
and subject to the investment objective and policies of the
Company and such policies as established by the Board, deems
appropriate in short-term money market securities.
(c) borrow money as HFM, in its discretion and subject to the
investment objective and policies of the Company and such
policies as established by the Board, deems necessary and
appropriate for purposes of cash management.
2. Without limiting the generality of paragraph 1 hereof, HFM shall
be authorized to open, maintain and close accounts in the name and on behalf of
the Company with brokers and dealers as it determines are appropriate; to select
and place orders with brokers, dealers or other financial intermediaries for the
execution, clearance or settlement of any transactions on behalf of the Company
on such terms as HFM considers appropriate and that are consistent with the
policies of the Company; and, subject to any policies adopted by the Board and
to the provisions of applicable law, to agree to such commissions, fees and
other charges on behalf of the Company as it shall deem reasonable in the
circumstances taking into account all such factors as it deems relevant
(including the quality of research and other services made available to it even
if such services are not for the exclusive benefit of the Company and the cost
of such services does not represent the lowest cost available) and shall be
under no obligation to combine or arrange orders so as to obtain reduced charges
unless otherwise required under the federal securities laws. HFM may, subject to
such procedures as may be adopted by the Board, use affiliates of HFM as brokers
to effect the Company's securities transactions and the Company may pay such
commissions to such brokers in such amounts as are permissible under applicable
law.
3
3. FEES; EXPENSES
(a) In consideration for the provision by HFM of its services
hereunder, the Company will pay HFM a quarterly fee of 0.125% (0.50% on an
annualized basis) of the Company's "net assets" (the "Management Fee"). "Net
assets" shall equal the total value of all assets of the Company, less an amount
equal to all accrued debts, liabilities and obligations of the Company
calculated before giving effect to any repurchases of interests.
(b) The Management Fee will be computed based on the Company's
net assets on the first business day of each calendar quarter, after adjustment
for any subscriptions effective on such date, and will be due and payable in
arrears within five business days after the end of such quarter. The Management
Fee will be pro rated appropriately for capital contributed on any date that
does not fall on the first day of a calendar quarter, or withdrawn from the Fund
other than on the last day of a calendar quarter, based on the actual number of
days remaining in such quarter.
(c) HFM is responsible for all costs and expenses associated
with the provision of its services hereunder. HFM shall, at its own expense,
maintain such staff and employ or retain such personnel and consult with such
other persons as may be necessary to render the services required to be provided
by HFM or furnished to the Company under this Agreement. Without limiting the
generality of the foregoing, the staff and personnel of HFM shall be deemed to
include persons employed or otherwise retained by HFM or made available to HFM.
4. The Company will, from time to time, furnish or otherwise make
available to HFM such financial reports, proxy statements, policies and
procedures and other information relating to the business and affairs of the
Company as HFM may reasonably require in order to discharge its duties and
obligations hereunder.
5. Except as provided herein or in another agreement between the
Company and HFM, the Company shall bear all of its own expenses, including: all
investment related expenses (including brokerage commissions); all costs and
expenses associated with the establishment of Portfolio Accounts; any
non-investment related interest expense; fees and disbursements of any attorneys
and accountants engaged by the Company; audit and tax preparation fees and
expenses of the Company; administrative expenses and fees; custody and escrow
fees and expenses; the costs of an errors and omissions/directors and officers
liability insurance policy and a fidelity bond; the fee payable to HFM; fees and
travel-related expenses of members of the Board (the "Managers") who are not
employees of HFM or any affiliated person of HFM; all costs and charges for
equipment or services used in communicating information regarding the Company's
transactions among HFM and any custodian or other agent engaged by the Company;
any extraordinary expenses; and such other expenses as may be approved from time
to time by the Board.
6. The compensation provided to HFM pursuant to paragraph 3(a)
hereof shall be the entire compensation for the services provided to the Company
and the expenses assumed by HFM under this Agreement.
4
7. HFM will use its best efforts in the supervision and management
of the investment activities of the Company and in providing services hereunder,
but in the absence of willful misfeasance, bad faith, gross negligence or
reckless disregard of its obligations hereunder, HFM, its directors, officers or
employees and its affiliates, successors or other legal representatives
(collectively, the "Affiliates") shall not be liable to the Company for any
error of judgment, for any mistake of law, for any act or omission by HFM or any
of the Affiliates or by any Sub-Adviser or Sub-Manager or for any loss suffered
by the Company.
8. (a) The Company shall indemnify HFM and its directors, officers
or employees and their respective affiliates, executors, heirs, assigns,
successors or other legal representatives (each an "Indemnified Person") against
any and all costs, losses, claims, damages or liabilities, joint or several,
including, without limitation, reasonable attorneys' fees and disbursements,
resulting in any way from the performance or non-performance of any Indemnified
Person's duties with respect to the Company, except those resulting from the
willful malfeasance, bad faith or gross negligence of an Indemnified Person or
the Indemnified Person's reckless disregard of such duties, and in the case of
criminal proceedings, unless such Indemnified Person had reasonable cause to
believe its actions unlawful (collectively, "disabling conduct").
Indemnification shall be made following: (i) a final decision on the merits by a
court or other body before which the proceeding was brought that the Indemnified
Person was not liable by reason of disabling conduct or (ii) a reasonable
determination, based upon a review of the facts and reached by (A) the vote of a
majority of the Managers who are not parties to the proceeding or (B) legal
counsel selected by a vote of a majority of the Board in a written advice, that
the Indemnified Person is entitled to indemnification hereunder. The Company
shall advance to an Indemnified Person (to the extent that it has available
assets and need not borrow to do so) reasonable attorneys' fees and other costs
and expenses incurred in connection with defense of any action or proceeding
arising out of such performance or non-performance. HFM agrees, and each other
Indemnified Person will agree as a condition to any such advance, that in the
event the Indemnified Person receives any such advance, the Indemnified Person
shall reimburse the Company for such fees, costs and expenses to the extent that
it shall be determined that the Indemnified Person was not entitled to
indemnification under this paragraph 8.
(b) Notwithstanding any of the foregoing to the contrary, the
provisions of paragraph 7 and this paragraph 8 shall not be construed so as to
relieve the Indemnified Person of, or provide indemnification with respect to,
any liability (including liability under Federal Securities laws, which, under
certain circumstances, impose liability even on persons who act in good faith)
to the extent (but only to the extent) that such liability may not be waived,
limited or modified under applicable law or that such indemnification would be
in violation of applicable law, but shall be construed so as to effectuate the
provisions of paragraph 7 and this paragraph 8 to the fullest extent permitted
by law.
9. Nothing contained in this Agreement shall prevent HFM or any
affiliated person of HFM from acting as or manager for any other person, firm or
corporation and, except as required by applicable law (including Rule 17j-1
under the 1940 Act), shall not in any way bind or restrict HFM or any such
affiliated person from buying, selling or trading any securities or commodities
for their own accounts or for the account of others for whom they may be acting.
Nothing in this Agreement shall limit or restrict the right of any member,
officer or employee of
5
HFM to engage in any other business or to devote his or her time and attention
in part to the management or other aspects of any other business whether of a
similar or dissimilar nature.
10. This Agreement will take effect on the date first set forth
above. Unless earlier terminated pursuant to this paragraph, this Agreement
shall remain in effect for a period of two (2) years from such date and shall
continue in effect from year to year thereafter, so long as such continuance
shall be approved at least annually by the vote of a "majority of the
outstanding voting securities of the Company," as defined by the 1940 Act and
the rules thereunder, or by the Board; and provided that in either event such
continuance is also approved by a majority of the Independent Managers, by vote
cast in person at a meeting called for the purpose of voting on such approval.
The Company may at any time, without payment of any penalty, terminate this
Agreement upon sixty days' prior written notice to HFM, either by majority vote
of the Board or by the vote of a "majority of the outstanding voting securities
of the Company," as defined by the 1940 Act and the rules thereunder. HFM may at
any time, without payment of penalty, terminate this Agreement upon sixty days'
prior written notice to the Company.
11. Any notice under this Agreement shall be given in writing and
shall be deemed to have been duly given when delivered by hand or facsimile or
five days after mailed by certified mail, post-paid, by return receipt requested
to the other party at the principal office of such party.
12. This Agreement may be amended only by the written agreement of
the parties. Any amendment shall be required to be approved by the Board and by
a majority of the Independent Managers in accordance with the provisions of
Section 15(c) of the 1940 Act and the rules thereunder, as if those rules
applied. If required by the 1940 Act, any amendment shall also be required to be
approved by the vote of a "majority of the outstanding rating securities of the
Company," as defined by the 1940 Act and the rules thereunder.
13. This Agreement shall be construed in accordance with the laws of
the State of New York and the applicable provisions of the 1940 Act. To the
extent the applicable law of the State of New York, or any of the provisions
herein, conflict with the applicable provisions of the 1940 Act, the latter
shall control.
14. The Company represents that this Agreement has been duly approved
by the Board, including the vote of a majority of the Independent Managers, and
by the vote of a "majority of the outstanding voting securities of the Company,"
as defined by the 1940 Act and the rules thereunder.
15. The parties to this Agreement agree that the obligations of the
Company under this Agreement shall not be binding upon any of the Managers,
members of the Company or any officers, employees or agents, whether past,
present or future, of the Company, individually, but are binding only upon the
assets and property of the Company.
16. This Agreement embodies the entire understanding of the parties.
{THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK}
6
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement on the day and year first above written.
EXCELSIOR DIRECTIONAL HEDGE FUND OF
FUNDS (TI), LLC
By:
--------------------------------------
Name:
Title:
U.S. TRUST HEDGE FUND MANAGEMENT, INC.
By:
--------------------------------------
Name:
Title:
7
