ADMINISTRATION, ACCOUNTING AND INVESTOR SERVICES AGREEMENT
THIS AGREEMENT is made as of ________, 2002 by and between PFPC INC., a
Massachusetts corporation ("PFPC"), and BACAP OPPORTUNITY STRATEGY, LLC, a
Delaware limited liability company (the "Fund").
W I T N E S S E T H :
WHEREAS, the Fund is registered as a closed-end, non-diversified
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, the Fund wishes to retain PFPC to provide administration,
accounting and investor services as provided for herein and PFPC wishes to
furnish such services.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, and intending to be legally bound hereby the parties
hereto agree as follows:
1. Definitions. As Used in this Agreement:
(a) "1933 Act" means the Securities Act of 1933, as amended.
(b) "1934 Act" means the Securities Exchange Act of 1934, as amended.
(c) "Authorized Person" means any officer of the Fund and any other
person duly authorized by the Fund's Board of Managers to give
Oral Instructions and Written Instructions on behalf of the Fund.
An Authorized Person's scope of authority may be limited by
setting forth such limitation in a written document signed by both
parties hereto.
(d) "Board of Managers" and "Members" shall have the same meanings as
set forth in the Fund's limited liability company agreement (the
"Limited Liability Company Agreement").
(e) "CEA" means the Commodities Exchange Act, as amended.
(f) "Change of Control" means a change in ownership or control (not
including transactions between wholly-owned direct or indirect
subsidiaries of a common parent) of 25% or more of the beneficial
ownership of the shares of common stock or shares of beneficial
interest of an entity or its parent(s).
(g) "Interests" means the shares of beneficial interest of any series
or class of the Fund.
(h) "Oral Instructions" mean oral instructions received by PFPC from
an Authorized Person or from a person reasonably believed by PFPC
to be an Authorized Person. PFPC may, in its sole discretion in
each separate instance, consider and rely upon instructions it
receives from an Authorized Person via electronic mail as Oral
Instructions.
(i) "Organizational Documents" mean, in the case of the Fund, the
by-laws, confidential memorandum, Limited Liability Company
Agreement, trust deed or other documents constituting the Fund.
(j) "SEC" means the Securities and Exchange Commission.
(k) "Securities Laws" means the 1933 Act, the 1934 Act, the 1940 Act
and the CEA.
(l) "Written Instructions" mean (i) written instructions signed by an
Authorized Person and received by PFPC or (ii) trade instructions
transmitted (and received by PFPC) by means of an electronic
transaction reporting system access to which requires use of a
password or other authorized identifier. The instructions may be
delivered by hand, mail, tested telegram, cable, telex or
facsimile sending device.
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2. Appointment. The Fund hereby appoints PFPC to provide administration,
accounting and investor services, in accordance with the terms set forth in
this Agreement. PFPC accepts such appointment and agrees to furnish such
services.
3. Delivery of Documents. The Fund has provided or, where applicable, will
provide PFPC with the following:
(a) at PFPC's request, certified or authenticated copies of the
resolutions of the Fund's Board of Managers, approving the appointment
of PFPC or its affiliates to provide services to the Fund and
approving this Agreement;
(b) a copy of Fund's most recent effective registration statement;
(c) a copy of the Fund's advisory agreement or agreements;
(d) a copy of the distribution/underwriting agreement with respect to the
Fund;
(e) a copy of each additional administration agreement;
(f) a copy of each distribution and/or Member servicing plan and agreement
made in respect of the Fund; and
(g) copies (certified or authenticated, where applicable) of any and all
amendments or supplements to the foregoing.
4. Compliance with Rules and Regulations.
PFPC undertakes to comply with all applicable requirements of the
Securities Laws, and any laws, rules and regulations of governmental
authorities having jurisdiction with respect to the duties to be performed
by PFPC hereunder. Except as specifically set forth herein, PFPC assumes no
responsibility for such compliance by the Fund or other entity.
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5. Instructions.
(a) Unless otherwise provided in this Agreement, PFPC shall act only upon
Oral Instructions or Written Instructions.
(b) PFPC shall be entitled to rely upon any Oral Instruction or Written
Instruction it receives from an Authorized Person (or from a person
reasonably believed by PFPC to be an Authorized Person) pursuant to
this Agreement. PFPC may assume that any Oral Instruction or Written
Instruction received hereunder is not in any way inconsistent with the
provisions of Organizational Documents or this Agreement or of any
vote, resolution or proceeding of the Fund's Board of Managers or of
the Fund's Members, unless and until PFPC receives Written Instructions
to the contrary.
(c) The Fund agrees to forward to PFPC Written Instructions confirming Oral
Instructions (except where such Oral Instructions are given by PFPC or
its affiliates) so that PFPC receives the Written Instructions by the
close of business on the same day that such Oral Instructions are
received. The fact that such confirming Written Instructions are not
received by PFPC or differ from the Oral Instructions shall in no way
invalidate the transactions or enforceability of the transactions
authorized by the Oral Instructions or PFPC's ability to rely upon such
Oral Instructions.
6. Right to Receive Advice.
(a) Advice of the Fund. If PFPC is in doubt as to any action it should or
should not take, PFPC may request directions or advice, including Oral
Instructions or Written Instructions, from the Fund.
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(b) Advice of Counsel. If PFPC shall be in doubt as to any question
of law pertaining to any action it should or should not take,
PFPC may request advice from counsel of its own choosing (who may
be counsel for the Fund, the Fund's investment adviser or PFPC,
at the option of PFPC).
(c) Conflicting Advice. In the event of a conflict between directions
or advice or Oral Instructions or Written Instructions PFPC
receives from the Fund and the advice PFPC receives from counsel,
PFPC may rely upon and follow the advice of counsel.
(d) Protection of PFPC. PFPC shall be indemnified by the Fund and
without liability for any action PFPC takes or does not take in
reliance upon directions or advice or Oral Instructions or
Written Instructions PFPC receives from or on behalf of the Fund
or from counsel and which PFPC believes, in good faith, to be
consistent with those directions or advice and Oral Instructions
or Written Instructions. Nothing in this section shall be
construed so as to impose an obligation upon PFPC (i) to seek
such directions or advice or Oral Instructions or Written
Instructions, or (ii) to act in accordance with such directions
or advice or Oral Instructions or Written Instructions.
7. Records; Visits.
(a) The books and records pertaining to the Fund which are in the
possession or under the control of PFPC shall be the property of the Fund. Such
books and records shall be prepared and maintained as required by the 1940 Act
and other applicable securities laws, rules and regulations. The Fund and
Authorized Persons shall have access to such books and records at all times
during PFPC's normal business
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hours. Upon the reasonable request of the Fund, copies of any
such books and records shall be provided by PFPC to the Fund or
to an Authorized Person, at the Fund's expense.
(b) PFPC shall keep the following records:
(i) all books and records with respect to the Fund's books of
account;
(ii) records of the Fund's securities transactions; and
(iii) all other books and records as PFPC is required to
maintain pursuant to Rule 31a-1 of the 1940 Act in
connection with the services provided hereunder.
8. Confidentiality. Each party shall keep confidential any information
relating to the other party's business ("Confidential Information").
Confidential Information shall include (a) any data or information that
is competitively sensitive material, and not generally known to the
public, including, but not limited to, information about product plans,
marketing strategies, finances, operations, customer relationships,
customer profiles, customer lists, sales estimates, business plans, and
internal performance results relating to the past, present or future
business activities of the Fund or PFPC, their respective subsidiaries
and affiliated companies and the customers, clients and suppliers of
any of them; (b) any scientific or technical information, design,
process, procedure, formula, or improvement that is commercially
valuable and secret in the sense that its confidentiality affords the
Fund or PFPC a competitive advantage over its competitors; (c) all
confidential or proprietary concepts, documentation, reports, data,
specifications, computer software, source code, object code, flow
charts, databases, inventions, know-how, and trade secrets, whether or
not patentable or copyrightable; and (d) anything designated as
confidential. Notwithstanding the foregoing, information shall not be
subject to such confidentiality obligations if it: (a) is already known
to the receiving party at the time it is obtained; (b)
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is or becomes publicly known or available through no wrongful act of
the receiving party; (c) is rightfully received from a third party who,
to the best of the receiving party's knowledge, is not under a duty of
confidentiality; (d) is released by the protected party to a third
party without restriction; (e) is required to be disclosed by the
receiving party pursuant to a requirement of a court order, subpoena,
governmental or regulatory agency or law (provided the receiving party
will provide the other party written notice of such requirement, to the
extent such notice is permitted); (f) is relevant to the defense of any
claim or cause of action asserted against the receiving party; or (g)
has been or is independently developed or obtained by the receiving
party.
9. Liaison with Accountants. PFPC shall act as liaison with the Fund's
independent public accountants and shall provide account analyses,
fiscal year summaries, and other audit-related schedules with respect
to the Fund. PFPC shall take all reasonable action in the performance
of its duties under this Agreement to assure that the necessary
information is made available to such accountants for the expression of
their opinion, as required by the Fund.
10. PFPC System. PFPC shall retain title to and ownership of any and all
data bases, computer programs, screen formats, report formats,
interactive design techniques, derivative works, inventions,
discoveries, patentable or copyrightable matters, concepts, expertise,
patents, copyrights, trade secrets, and other related legal rights
utilized by PFPC in connection with the services provided by PFPC to
the Fund.
11. Disaster Recovery. PFPC shall enter into and shall maintain in effect
with appropriate parties one or more agreements making reasonable
provisions for emergency use of electronic data processing equipment to
the extent appropriate equipment is available. In
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the event of equipment failures, PFPC shall, at no additional expense
to the Fund, take reasonable steps to minimize service interruptions.
PFPC shall have no liability with respect to the loss of data or
service interruptions caused by equipment failure, provided such loss
or interruption is not caused by PFPC's own willful misfeasance, bad
faith, gross negligence or reckless disregard of its duties or
obligations under this Agreement.
12. Compensation. As compensation for services rendered by PFPC during the
term of this Agreement, the Fund will pay to PFPC a fee or fees as may
be agreed to in writing by the Fund and PFPC.
13. Indemnification. The Fund agrees to indemnify, defend and hold harmless
PFPC and its affiliates, including their respective officers,
directors, agents and employees from all taxes, charges, expenses,
assessments, claims and liabilities (including, without limitation,
attorneys' fees and disbursements and liabilities arising under the
Securities Laws and any state and foreign securities and blue sky laws)
arising directly or indirectly from any action or omission to act which
PFPC takes in connection with the provision of services to the Fund.
Neither PFPC, nor any of its affiliates, shall be indemnified against
any liability (or any expenses incident to such liability) caused by
PFPC's or its affiliates' own willful misfeasance, bad faith, gross
negligence or reckless disregard in the performance of PFPC's
activities under this Agreement. The provisions of this Section 13
shall survive termination of this Agreement.
14. Responsibility of PFPC.
(a) PFPC shall be under no duty to take any action hereunder on
behalf of the Fund except as specifically set forth herein or as
may be specifically agreed to by PFPC and the Fund in a written
amendment hereto. PFPC shall be obligated to exercise
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care and diligence in the performance of its duties hereunder
and to act in good faith in performing services provided for
under this Agreement. PFPC shall be liable only for any
damages arising out of PFPC's failure to perform its duties
under this Agreement to the extent such damages arise out of
PFPC's willful misfeasance, bad faith, gross negligence or
reckless disregard of such duties.
(b) Notwithstanding anything in this Agreement to the contrary,
(i) PFPC shall not be liable for losses, delays, failure,
errors, interruption or loss of data occurring directly or
indirectly by reason of circumstances beyond its reasonable
control, including without limitation acts of God; action or
inaction of civil or military authority; public enemy; war;
terrorism; riot; fire; flood; sabotage; epidemics; labor
disputes; civil commotion; interruption, loss or malfunction
of utilities, transportation, computer or communications
capabilities; insurrection; elements of nature; or
non-performance by a third party; and (ii) PFPC shall not be
under any duty or obligation to inquire into and shall not be
liable for the validity or invalidity, authority or lack
thereof, or truthfulness or accuracy or lack thereof, of any
instruction, direction, notice, instrument or other
information which PFPC reasonably believes to be genuine.
(c) Notwithstanding anything in this Agreement (whether contained
anywhere in Sections 15-17 or otherwise) to the contrary, Fund
hereby acknowledges and agrees that (i) PFPC, in the course of
providing tax-related services or calculating and reporting
portfolio performance hereunder, may rely upon PFPC's
interpretation of tax positions or its interpretation of
relevant circumstances (as determined by PFPC) in providing
such tax services and in determining methods
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of calculating portfolio performance to be used, and that (ii)
PFPC shall not be liable for losses or damages of any kind
associated with such reliance except to the extent such loss
or damage is substantially due to PFPC's gross negligence or
willful misconduct.
(d) Notwithstanding anything in this Agreement to the contrary,
without limiting anything in the immediately preceding
sentence, Fund hereby acknowledges and agrees that PFPC shall
not be liable for any losses or damages of any kind associated
with any tax filings with which PFPC has assisted in any way
except to the extent such loss or damage is substantially due
to PFPC's gross negligence or willful misconduct; provided,
however, that PFPC shall not be found to have been grossly
negligent for losses or damages associated with areas of
responsibility that the judiciary, regulators (or other
governmental officials) or members of the hedge fund industry
determine would otherwise apply to PFPC (or similar service
providers) and which, as of the date hereof, have yet to be
identified by such parties as areas for which PFPC (or any
similar service provider) is (or would be) responsible.
(e) Notwithstanding anything in this Agreement to the contrary,
(i) neither PFPC nor its affiliates shall be liable for any
consequential, special or indirect losses or damages, whether
or not the likelihood of such losses or damages was known by
PFPC or its affiliates and (ii) PFPC's cumulative liability to
the Fund for all losses, claims, suits, controversies,
breaches or damages for any cause whatsoever (including but
not limited to those arising out of or related to this
Agreement) and regardless of the form of action or legal
theory shall not exceed the lesser of
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$100,000 or the fees received by PFPC for services provided
hereunder during the 12 months immediately prior to the date
of such loss or damage.
(f) No party may assert a cause of action against PFPC or any of
its affiliates that allegedly occurred more than 12 months
immediately prior to the filing of the suit (or, if
applicable, commencement of arbitration proceedings) alleging
such cause of action.
(g) Each party shall have a duty to mitigate damages for which the
other party may become responsible.
(h) The provisions of this Section 14 shall survive termination of
this Agreement.
15. Description of Accounting Services on a Continuous Basis.
PFPC will perform the following accounting services with respect to
the Fund:
(i) Journalize investment, capital share and income and
expense activities;
(ii) Verify investment buy/sell trade tickets when received
from the investment adviser (the "Adviser") and
transmit trades to the Fund's custodian (the
"Custodian") for proper settlement;
(iii) Maintain individual ledgers for investment securities;
(iv) Maintain historical tax lots for each security;
(v) Reconcile cash and investment balances of the Fund with
the Custodian and prime broker, and provide the Adviser
with the beginning cash balance available for
investment purposes;
(vi) Update the cash availability throughout the day as
required by the Adviser;
(vii) Post to and prepare the Statement of Assets and
Liabilities and the Statement of Operations;
(viii) Calculate various contractual expenses (e.g., advisory
and custody fees);
(ix) Monitor the expense accruals and notify an officer of
the Fund of any proposed adjustments;
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(x) Control all disbursements and authorize such disbursements
upon Written Instructions;
(xi) Calculate capital gains and losses;
(xii) Determine net income;
(xiii) Obtain security market quotes from independent pricing
services approved by the Adviser, or if such quotes are
unavailable, then obtain such prices from the Adviser, and in
either case calculate the market value of the Fund's
Investments;
(xiv) Transmit or mail a copy of the daily portfolio valuation to
the Adviser;
(xv) Compute net asset value;
(xvi) As appropriate, compute yields, total return, expense ratios,
portfolio turnover rate, and, if required, portfolio average
dollar-weighted maturity; and
(xvii) Prepare a monthly financial statement, which will include the
following items:
Schedule of Investments
Statement of Assets and Liabilities
Statement of Operations
Statement of Changes in Net Assets
Cash Statement
Schedule of Capital Gains and Losses.
16. Description of Administration Services on a Continuous Basis.
PFPC will perform the following administration services with respect to the
Fund:
(i) Prepare quarterly broker security transactions summaries;
(ii) Prepare monthly security transaction listings;
(iii) Supply various normal and customary Fund statistical data as
requested on an ongoing basis;
(iv) Prepare for execution and file the Fund's Federal and state
tax returns;
(v) Prepare and file the Fund's Semi-Annual Reports with the SEC
on Form N-SAR;
(vi) Prepare and file with the SEC the Fund's annual, semi-annual,
and quarterly Member reports;
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(vii) Assist in the preparation of registration statements and other
filings relating to the registration of Interests; and
(viii) Coordinate contractual relationships and communications between
the Fund and its contractual service providers.
17. Description of Investor Services on a Continuous Basis. PFPC will perform
the following functions:
(i) Maintain the register of Members of the Fund and enter on such
register all issues, transfers and repurchases of Interests in
the Fund;
(ii) Arrange for the calculation of the issue and repurchase prices
of Interests in the Fund in accordance with the Limited
Liability Company Agreement;
(iii) Allocate income, expenses, gains and losses to individual
Member's capital accounts in accordance with the Fund's Limited
Liability Company Agreement;
(iv) Calculate the Incentive Allocation, if applicable, in
accordance with the Limited Liability Company Agreement and
reallocate corresponding amounts from the applicable Member's
capital accounts to the Board of Managers' capital account; and
(v) Prepare and mail annually to partners any required Form K-1 in
accordance with applicable tax regulations.
18. Duration and Termination. This Agreement shall continue until terminated by
the Fund or by PFPC on sixty (60) days' prior written notice to the other
party. In the event the Fund gives notice of termination, all expenses
associated with movement (or duplication) of records and materials and
conversion thereof to a successor accounting and administration services
agent(s) (and any other service provider(s)), and all trailing expenses
incurred by PFPC, will be borne by the Fund.
19. Change of Control. Notwithstanding any other provision of this Agreement,
in the event of an agreement to enter into a transaction that would result
in a Change of Control of the Fund's adviser or sponsor, the Fund's ability
to terminate the Agreement pursuant
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to Section 17 will be suspended from the time of such agreement until
two years after the Change of Control.
20. Notices. Notices shall be addressed (a) if to PFPC, at 000 Xxxxxxxx
Xxxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: President; (b) if to
the Fund, at , Attention: or (c) if to neither
of the foregoing, at such other address as shall have been given by
like notice to the sender of any such notice or other communication by
the other party. If notice is sent by confirming telegram, cable, telex
or facsimile sending device, it shall be deemed to have been given
immediately. If notice is sent by first-class mail, it shall be deemed
to have been given three days after it has been mailed. If notice is
sent by messenger, it shall be deemed to have been given on the day it
is delivered.
21. Amendments. This Agreement, or any term thereof, may be changed or
waived only by written amendment, signed by the party against whom
enforcement of such change or waiver is sought.
22. Assignment. PFPC may assign its rights hereunder to any majority-owned
direct or indirect subsidiary of PFPC or of The PNC Financial Services
Group, Inc., provided that PFPC gives the Fund 30 days prior written
notice of such assignment.
23. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
24. Further Actions. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the
purposes hereof.
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25. Miscellaneous.
(a) Notwithstanding anything in this Agreement to the contrary, the
Fund agrees not to make any modifications to its registration
statement or adopt any policies which would affect materially the
obligations or responsibilities of PFPC hereunder without the
prior written approval of PFPC, which approval shall not be
unreasonably withheld or delayed.
(b) Except as expressly provided in this Agreement, PFPC hereby
disclaims all representations and warranties, express or implied,
made to the Fund or any other person, including, without
limitation, any warranties regarding quality, suitability,
merchantability, fitness for a particular purpose or otherwise
(irrespective of any course of dealing, custom or usage of trade),
of any services or any goods provided incidental to services
provided under this Agreement. PFPC disclaims any warranty of
title or non-infringement except as otherwise set forth in this
Agreement.
(c) This Agreement embodies the entire agreement and understanding
between 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. The
captions in this Agreement are included for convenience of
reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or
effect. Notwithstanding any provision hereof, the services of PFPC
are not, nor shall they be, construed as constituting legal advice
or the provision of legal services for or on behalf of the Fund or
any other person.
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(d) This Agreement shall be deemed to be a contract made in Delaware
and governed by Delaware law, without regard to principles of
conflicts of law.
(e) 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. This Agreement shall
be binding upon and shall inure to the benefit of the parties
hereto and their respective successors and permitted assigns.
(f) The facsimile signature of any party to this Agreement shall
constitute the valid and binding execution hereof by such party.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
PFPC INC.
By: ____________________________________
Title: _________________________________
BACAP OPPORTUNITY STRATEGY, LLC
By: ____________________________________
Title: _________________________________
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