EXHIBIT 99.K(1)
ADMINISTRATION, FUND ACCOUNTING AND RECORDKEEPING AGREEMENT
THIS AGREEMENT is made as of this ___ day of _______, 2006, by and between
Hatteras Multi-Strategy Institutional TEI Fund, L.P., a Delaware limited
partnership (the "Fund"), and UMB Fund Services, Inc., a Wisconsin corporation
(the "Administrator").
WHEREAS, the Fund is a limited partnership which is registered as a
closed-end, non-diversified management investment company under the provisions
of the Investment Company Act of 1940 (the "1940 Act"); and
WHEREAS, the Fund is authorized to offer and sell limited partnership
interests in the Fund representing interests in a separate portfolio of
securities and other assets (the "Interests") in reliance on exemptions provided
in the Securities Act of 1933 (the "Securities Act") and state securities laws
for transactions not involving any public offering; and
WHEREAS, in pursuit of its investment objective, the Fund will invest its
assets primarily in private investment funds ("Portfolio Funds"); and
WHEREAS, the Fund and the Administrator desire to enter into an agreement
pursuant to which the Administrator shall provide certain administration, fund
accounting and recordkeeping services to the Fund.
NOW, THEREFORE, in consideration of the mutual promises and agreements
herein contained and other good and valuable consideration, the receipt of which
is hereby acknowledged, the parties hereto, intending to be legally bound, do
hereby agree as follows:
1. APPOINTMENT
The Fund hereby appoints the Administrator as administrator, fund
accountant and record keeper of the Fund for the period and on the terms set
forth in this Agreement. The Administrator accepts such appointment and agrees
to render the services herein set forth, for the compensation herein provided.
2. SERVICES
(a) Subject to the direction and control of the Fund and utilizing
information provided by the Fund and its agents and service providers, the
Administrator will provide the services listed on Schedule A hereto. The duties
of the Administrator shall be confined to those expressly set forth therein, and
no implied duties are assumed by or may be asserted against the Administrator
hereunder. The Fund agrees not to make any modifications to its registration
statement or adopt any policies that would materially affect the obligations and
responsibilities of the Administrator hereunder without the prior written
approval of the Administrator, which approval shall not be unreasonably
withheld.
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(b) Hatteras Investment Partners LLC (the "Manager"), the manager of the
Fund, shall use reasonable efforts to cause the investment adviser(s) and
sub-advisers (each a "Portfolio Manager"), prime broker and/or custodian, legal
counsel, independent accountants and other service providers and agents, past or
present, for the Fund to cooperate with the Administrator and to provide the
Administrator with such information, documents and advice relating to the Fund
as necessary and/or appropriate or as requested by the Administrator, in order
to enable the Administrator to perform its duties hereunder. In connection with
its duties hereunder, the Administrator shall (without investigation or
verification) be entitled and is hereby instructed to, rely upon any and all
oral or written instructions, advice, information or documents provided to the
Administrator by an officer or representative of the Manager or the Fund or by
any of the aforementioned persons. The Administrator shall be entitled to rely
on any document that it reasonably believes to be genuine and to have been
signed or presented by the proper party. Fees charged by such persons shall not
be an expense of the Administrator. The Administrator shall not be held to have
notice of any change of authority of any officer, agent, representative or
employee of the Manager, the Fund, investment adviser(s), Portfolio Managers or
service provider until receipt of written notice thereof from the Fund. As used
in this Agreement, the term "Investment Adviser" includes all Portfolio Managers
or persons performing similar services.
(c) At any time, the Administrator may request instructions from the Fund
with respect to any matter arising in connection with this Agreement. If such
instructions are not received within a reasonable time, the Administrator may
seek advice from legal counsel for the Fund at the expense of the Fund, or its
own legal counsel at its own expense, and it shall not be liable for any action
taken or not taken by it in good faith in accordance with such instructions or
in accordance with advice of counsel.
(d) The Administrator hereby agrees that all records which it maintains for
the Fund pursuant to its duties hereunder are the property of the Fund and
further agrees to surrender promptly to the Fund any of such records upon the
Manager's request.
(e) It is understood that in determining security valuations, the
Administrator employs one or more pricing services, as directed by the Fund, to
determine valuations of portfolio securities for purposes of calculating net
asset values of the Fund. The Fund shall identify to the Administrator the
pricing service(s) to be utilized on behalf of the Fund. The Administrator shall
price the securities and other holdings of the Fund for which market quotations
or prices are available by the use of such services. For those securities where
prices are not provided by the pricing service(s) utilized by the Administrator,
the Fund shall approve, in good faith, the method for determining the fair value
of the securities. The Fund's investment adviser shall determine or obtain the
valuation of the securities in accordance with those procedures and shall
deliver to the Administrator the resulting prices for use in its calculation of
net asset values. With respect to the underlying Portfolio Funds in which the
Fund invests, the Administrator shall price such investments based on the
valuations provided to it by the Manager and/or the Portfolio Managers. The
Administrator is authorized to rely on the prices provided by such service(s) or
by the Fund's investment adviser(s), Portfolio Managers or other authorized
representative of the Fund without investigation or verification.
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(f) The Fund's Manager and investment adviser(s) have and retain primary
responsibility for all compliance matters relating to the Fund, including but
not limited to compliance with all applicable provisions of the Securities Act,
the 1940 Act, the Securities Exchange Act of 1934, state securities laws, the
Internal Revenue Code of 1986, as amended, the USA PATRIOT Act of 2002, the
Xxxxxxxx-Xxxxx Act of 2002 and the policies and limitations of the Fund relating
to the portfolio investments as set forth in the Private Offering Memorandum
dated ___________, and any successor thereto (the "Offering Memorandum"). The
Administrator's monitoring and other functions hereunder shall not relieve the
Manager and the investment adviser(s) of their primary day-to-day responsibility
for assuring such compliance.
(g) The Fund hereby certifies that it has undertaken (or will undertake in
a timely manner) all filings and other actions necessary to permit the Fund to
lawfully offer and sell Interests in the Fund without registration under the
Securities Act and the applicable securities laws of each state and territory in
which the Fund intends to offer and sell Interests. Except as otherwise noted on
Schedule A hereto, the Fund is not delegating to the Administrator any
responsibility to monitor or otherwise take any actions with respect to the
qualification for or maintenance of any applicable Federal or state securities
law exemptions.
(h) The Administrator shall maintain a disaster recovery and business
continuity plan and adequate and reliable computer and other equipment necessary
and appropriate to carry out its obligations under this Agreement. Upon the
Fund's reasonable request, the Administrator shall provide supplemental
information concerning the aspects of its disaster recovery and business
continuity plan that are relevant to the services provided hereunder.
3. FEES; DELEGATION; EXPENSES
(a) In consideration of the services rendered pursuant to this Agreement,
the Fund will pay the Administrator a fee, computed and payable monthly based on
monthly net assets, plus out-of-pocket expenses, each as provided in Schedule B
hereto. In addition, to the extent that the Administrator corrects, verifies or
addresses any prior actions or inactions by the Fund or by any other service
provider, the Administrator shall be entitled to additional fees as provided in
Schedule B. Fees shall be adjusted in accordance with Schedule B or as otherwise
agreed to by the parties from time to time. The parties may amend this Agreement
to include fees for any additional services requested by the Fund, enhancements
to current services, or to add funds for which the Administrator has been
retained. The Fund agrees to pay the Administrator's then current rate for
additional services provided, or for enhancements to existing services currently
provided, after the execution of this Agreement.
(b) For the purpose of determining fees payable to the Administrator, net
asset value shall be computed in accordance with the Fund's Limited Partnership
Agreement, the Offering Memorandum and the resolutions of the Fund, if any. The
fee for the period from the day of the month charges begin accruing under this
Agreement until the end of that month shall be pro-rated according to the
proportion that such period bears to the full monthly period. Upon any
termination of this Agreement before the end of any month, the fee for such part
of a month shall be pro-rated according to the proportion which such period
bears to the full monthly period and shall be payable upon the date of
termination of this
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Agreement. Should the Fund be liquidated, merged with or acquired by another
fund or investment company, any accrued fees shall be immediately payable.
(c) The Administrator will bear all expenses incurred by it in connection
with the performance of its services under Section 2, except as otherwise
provided herein. The Administrator shall not be required to pay or finance any
costs and expenses incurred in the operation of the Fund, including, but not
limited to: taxes; interest; brokerage fees and commissions; salaries, fees and
expenses of the Manager or any officers; any Securities and Exchange Commission
(the "Commission") fees and state Blue Sky fees; advisory fees; charges of
custodians, prime brokers, transfer agents, dividend disbursing and accounting
services agents and other service providers; security pricing services;
insurance premiums; outside auditing and legal expenses, including but not
limited to attorneys' fees incurred in connection with responding to or
complying with SEC or other regulatory investigations, inquiries or subpoenas;
costs of organization and maintenance of corporate existence; taxes and fees
payable to federal, state and other governmental agencies; preparation,
typesetting, printing, proofing and mailing of prospectuses, statements of
additional information, Offering Memoranda or notices, forms or applications and
proxy materials for regulatory purposes and for distribution to prospective or
current limited partners; preparation, typesetting, printing, proofing and
mailing and other costs of shareholder reports; expenses in connection with the
electronic transmission of documents and information including electronic
filings with the Commission and the states; research and statistical data
services; expenses incidental to holding meetings of the Fund's limited partners
and Manager; fees and expenses associated with internet, e-mail and other
related activities; expenses incurred for distribution of Interests and
extraordinary expenses. The Administrator shall not be required to pay any Blue
Sky fees or take any related Blue Sky actions except as set forth on Schedule A,
and then not unless and until it has received the amount of such fees from the
Fund.
(d) Except as otherwise specified, fees payable hereunder shall be
calculated in arrears and billed on a monthly basis. The Fund agrees to pay all
fees within thirty days of receipt of each invoice or other method of
notification of payment due the Administrator. The Administrator retains the
right to charge interest in the amount of 1 percent per month on any amounts
that remain unpaid beyond such thirty day period.
4. PROPRIETARY AND CONFIDENTIAL INFORMATION
The Administrator agrees on behalf of itself and its employees to treat
confidentially and as proprietary information of the Fund all records relative
to the Fund and its business, not to use such records and information for any
purpose other than performance of its responsibilities and duties hereunder, and
not to disclose such information except where the Administrator may be exposed
to civil or criminal proceedings for failure to comply, when requested to
divulge such information by duly constituted authorities or court process, when
subject to governmental or regulatory audit or investigation, or when so
requested by the Fund. In case of any requests or demands for inspection of the
records of the Fund, the Administrator will endeavor to notify the Manager
promptly and to secure instructions from a representative of the Manager as to
such inspection, unless prohibited by law from making such notification. Records
and information which have become known to the public through no action or
inaction of the Administrator or any of its employees, agents or
representatives, and
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information which was already in the possession of the Administrator prior to
the date hereof, shall not be subject to this paragraph.
5. LIMITATION OF LIABILITY
(a) The Administrator shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Fund in connection with the
matters to which this Agreement relates, except for a loss resulting from the
Administrator's willful misfeasance, bad faith or gross negligence in the
performance of its duties or from reckless disregard by it of its obligations
and duties under this Agreement. Furthermore, the Administrator shall not be
liable for (i) any action taken or omitted to be taken in accordance with or in
reliance upon written or oral instructions, advice, data, documents or
information (without investigation or verification) received by the
Administrator from or on behalf of the Manager or an officer or representative
of the Fund, or from a representative of any of the parties referenced in
Section 2, (ii) its reliance on the security valuations without investigation or
verification provided by pricing service(s), the Fund's Manager, a Portfolio
Manager or other representatives of the Fund, (iii) any liability arising from
the offer or sale of any Interest by the Fund in reliance on exemptions from
registration under the Securities Act and the applicable securities laws of each
state and territory in which the Fund intends to offer and sell Interests, or
(iv) any action taken or omission by the Fund, the Manager, investment
adviser(s), Portfolio Mangers or any past or current service provider.
(b) The Administrator assumes no responsibility hereunder, and shall not be
liable, for any default, damage, loss of data or documents, errors, delay or any
other loss whatsoever caused by events beyond its reasonable control. The
Administrator will, however, take all reasonable steps to minimize service
interruptions for any period that such interruption continues beyond its
control.
(c) The Fund agrees to indemnify and hold harmless the Administrator, its
employees, agents, officers, directors, affiliates and nominees (collectively,
the "Indemnified Parties") from and against any and all claims, demands, actions
and suits, and from and against any and all judgments, liabilities, losses,
damages, costs, charges, reasonable counsel fees and other expenses of every
nature and character which may be asserted against or incurred by any
Indemnified Party or for which any Indemnified Party may be held liable (a
"Claim") arising out of or in any way relating to (i) the Administrator's
actions or omissions, (ii) the Administrator's reliance on, implementation of or
use of (without investigation or verification) advice, instructions, requests,
directions, information, data, records and documents received by the
Administrator from any party referenced in Section 2 hereof or other
representative of the Fund, (iii) any breach of any of the Fund's obligations,
representations or warranties hereunder, or (iv) any action taken by or omission
of the Fund, its Manager, any Portfolio Managers, investment adviser(s) or any
past or current service provider. The Indemnified Parties shall not be
indemnified to the extent a Claim resulted from the Administrator's or the
Indemnified Parties' willful misfeasance, bad faith, or gross negligence in the
performance of the Administrator's duties hereunder or from reckless disregard
by the Administrator of its obligations and duties hereunder.
(d) The Administrator agrees to indemnify and hold harmless the Fund, its
employees, officers and directors (collectively, the "Fund Indemnified Parties")
from and against any and all claims, demands, actions and suits, and from and
against any and all judgments, liabilities, losses, damages,
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costs, charges, reasonable counsel fees and other expenses of every nature and
character which may be asserted against or incurred by any Fund Indemnified
Party or for which any Fund Indemnified Party may be held liable, arising out of
or in any way relating to the Administrator's willful misfeasance, bad faith or
gross negligence in the performance of its duties or from reckless disregard by
it of its obligations and duties under this Agreement.
(e) In no event and under no circumstances shall either party, its
affiliates or any of its or their officers, directors, members, agents or
employees be liable to anyone, including, without limitation, the other party,
under any theory of tort, contract, strict liability or other legal or equitable
theory for lost profits, exemplary, punitive, special, indirect or consequential
damages for any act or failure to act under any provision of this Agreement
regardless of whether such damages were foreseeable and even if advised of the
possibility thereof. The indemnity and defense provisions set forth in this
Section 5 shall indefinitely survive the termination and/or assignment of this
Agreement.
6. TERM
(a) This Agreement shall become effective as of the date this Agreement is
executed and shall continue in effect until terminated as provided herein.
Either party may terminate this Agreement at any time by giving the other party
a written notice not less than sixty (60) days prior to the date the termination
is to be effective.
(b) The terms of this Agreement shall not be waived, altered, modified,
amended or supplemented in any manner whatsoever except by a written instrument
signed by the Administrator and the Fund.
(c) Notwithstanding anything herein to the contrary, upon the termination
of this Agreement or the liquidation of the Fund, the Administrator shall
deliver the records of the Fund in the form maintained by the Administrator (to
the extent permitted by applicable license agreements) to the Fund or person(s)
designated by the Fund at the Fund's cost and expense, and thereafter the Fund
or its designee shall be solely responsible for preserving the records for the
periods required by all applicable laws, rules and regulations. The
Administrator shall be entitled to maintain a copy of such records for the sole
purpose of defending itself against any action arising under or as a result of
this Agreement or as otherwise required or permitted by law. The Fund shall be
responsible for all expenses associated with the movement (or duplication) of
records and materials and conversion thereof to a successor fund accounting and
administrative services agent, including all reasonable trailing expenses
incurred by the Administrator. In addition, in the event of termination of this
Agreement, or the proposed liquidation or merger of the Fund, and the Fund
requests the Administrator to provide additional services in connection
therewith, the Administrator shall provide such services and be entitled to such
compensation as the parties may mutually agree.
(d) 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, as hereinafter defined, of the Fund's Manager, investment adviser or
sponsor, the Fund's ability to terminate this Agreement pursuant to this Section
6 shall be suspended from the time of such agreement until eighteen months after
the Change of
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Control. For purposes of this Agreement, a "Change of Control" of the Manager,
investment adviser or sponsor means a change in ownership or control of more
than fifty percent (50%) of the common stock or shares of beneficial interest of
such Manager, investment adviser or sponsor or its parent company.
7. NON-EXCLUSIVITY
The services of the Administrator rendered to the Fund are not deemed to be
exclusive. The Administrator may render such services and any other services to
others, including other investment vehicles, including hedge funds.
8. GOVERNING LAW; INVALIDITY
This Agreement shall be governed by Wisconsin law, excluding the laws on
conflicts of laws. To the extent that the applicable laws of the State of
Wisconsin, or any of the provisions herein, conflict with the applicable
provisions of the 1940 Act, the latter shall control, and nothing herein shall
be construed in a manner inconsistent with the 1940 Act or any rule or order of
the Commission thereunder. Any provision of this Agreement which may be
determined by competent authority to be prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. In such case, the parties shall in good faith modify or
substitute such provision consistent with the original intent of the parties.
9. NOTICES
Any notice required or permitted to be given by either party to the other
shall be in writing and shall be deemed to have been given when sent by
registered or certified mail, postage prepaid, return receipt requested, as
follows: Notice to the Administrator shall be sent to UMB Fund Services, Inc.,
000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx X, Xxxxxxxxx, XX, 00000, Attention: Xxxxx X.
Xxxxxxx, with a copy to General Counsel, and notice to the Fund shall be sent to
Hatteras Multi-Strategy Institutional TEI Fund, L.P., 0000 Xxx Xxxxx Xxxx, Xxxxx
000, Xxxxxxx, XX 00000, Attention: Xxxxx X. Xxxxxxx.
10. ENTIRE AGREEMENT
This Agreement, together with the Schedules attached hereto, constitutes
the entire Agreement of the parties hereto.
11. COUNTERPARTS
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This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original agreement but such counterparts shall together
constitute but one and the same instrument. The facsimile signature of any party
to this Agreement shall constitute the valid and binding execution hereof by
such party.
12. AMENDMENTS
This Agreement may be amended only by the written agreement of the parties
hereto.
13. ASSIGNMENT; SUCCESSORS AND ASSIGNS
Neither party may assign this Agreement without the prior written consent
of the other party; provided, however, that the Administrator may assign its
rights hereunder to any subsidiary or affiliate with thirty (30) days' prior
written notice of such assignment. This Agreement shall be binding upon and
shall insure to the benefit of the parties hereto and their respective
successors and permitted assigns.
14. LEGAL ADVICE
Notwithstanding anything in this Agreement to the contrary, the services
provided by the Administrator hereunder do not constitute, 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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by a duly authorized officer as of the day and year first above
written.
HATTERAS MULTI-STRATEGY INSTITUTIONAL
TEI FUND, L.P.
(the "Fund")
By: Hatteras Investment Management
LLC, General Partner
By:
----------------------------------
Xxxxx X. Xxxxxxx, Managing Member
UMB FUND SERVICES, INC.
("Administrator")
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By:
----------------------------------
Xxxxx X. Xxxxxxx, Executive
Vice President
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SCHEDULE A
TO THE
ADMINISTRATION, FUND ACCOUNTING AND RECORDKEEPING AGREEMENT
BY AND BETWEEN
HATTERAS MULTI-STRATEGY INSTITUTIONAL TEI FUND, L.P.
AND
UMB FUND SERVICES, INC.
SERVICES
Subject to the direction and control of the Fund's Manager and utilizing
information provided by the Fund and its agents, the Administrator will:
- provide office space, facilities, equipment and personnel to carry out its
services hereunder;
- compile data for and prepare with respect to the Fund Semi-Annual Reports
on Form N-SAR;
- prepare and review the financial statement for the Fund's Annual and
Semi-Annual Reports included in Form N-CSR as required under the
Xxxxxxxx-Xxxxx Act; assist in compiling exhibits and disclosures for Form
N-CSR as requested by the Manager;
- provide financial and Fund performance information for inclusion in the
Registration Statement for the Fund (on Form N-2 or any replacement
therefor) and any amendments thereto, subject to the review of Fund
counsel;
- assist in the acquisition of the Fund's directors' and officers' errors and
omissions insurance, assist in the acquisition of the Fund's fidelity bond
required by the 1940 Act, and monitor the amount of the bond and make the
necessary Commission filings related thereto;
- from time to time as the Administrator deems appropriate, check the Fund's
compliance with the policies and limitations of the Fund relating to the
portfolio investments as set forth in the Fund's Offering Memorandum,
Prospectus and Statement of Additional Information (but these functions
shall not relieve the Fund's investment adviser and sub-advisers, if any,
of their primary day-to-day responsibility for assuring such compliance);
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- develop with legal counsel and the secretary of the Fund an agenda for each
board meeting and, if requested by the Board of Managers, attend board
meetings and prepare minutes;
- prepare Form 1099s for board members and other Fund vendors;
- upon the advice and direction of Fund counsel, coordinate periodic tender
offers for the Fund (initial forms for such tender offers shall be prepared
by Fund counsel);
- upon the advice and direction of Fund counsel, coordinate filings of Forms
3, 4 and 5 for the Fund's officers and board members;
- assist the Fund with its monitoring obligations under the USA PATRIOT Act
by (1) at such time as directed by the Manager, rejecting Subscription
Agreements that are not accompanied by required identifying information;
(2) checking identifying information against the LEXIS/NEXIS(R) AML
database (or any successor thereto) licensed by the Administrator; (3)
checking persons submitting Subscription Agreements against the Office of
Foreign Asset Controls (OFAC) list; (4) upon consultation with the Manager,
filing a suspicious activity report with the appropriate authorities; (5)
permitting federal regulators access to such information and records
maintained by the Administrator relating to the Administrator's
implementation of the Fund's monitoring obligations, as they may request,
and (6) permitting such federal regulators to inspect the Administrator's
implementation of such monitoring obligations on behalf of the Fund;
- prepare and file state securities qualification/notice compliance filings,
with the advice of the Fund's legal counsel, upon and in accordance with
instructions from the Fund, which instructions will include the states to
qualify in, the amounts of Interests to initially and subsequently qualify
and the warning threshold to be maintained;
- on a monthly basis, pursuant to the terms of the Limited Partnership
Agreement, prepare a report reflecting the Fund's performance and provide
comparisons of performance information to pertinent benchmarks;
- act as liaison with the Fund's independent public accountants, and provide
account analyses, fiscal year summaries and other audit-related information
schedules;
- assist in the preparation of the Fund's annual financial reports, subject
to the review and approval of the Fund and the Fund's independent public
accountants;
- review subscription documents for reasonableness; provided, however, the
Manager remains solely responsible for determining accreditation;
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- at the direction of the Manager, establish and maintain partner capital
accounts for each investor;
- coordinate processing and reporting of investor activity, including to
financial intermediaries comprising the Fund's distribution channel;
- calculate items of income, expense, gain and loss, and allocate such items
to individual partners' capital accounts in accordance with the Fund's
Limited Partnership Agreement;
- enter all Portfolio Fund and security transactions into the accounting
records;
- receive and record all transaction information provided by the Manager;
- where applicable, verify individual security settlements with the
custodian/prime broker;
- maintain a security ledger of transactions;
- maintain individual tax lots for each security purchase/sale;
- determine realized gains or losses on security trades;
- monitor individual investments for corporate actions, cash dividends and
capital changes;
- provide work papers sufficient to permit the preparation and filing of all
federal and state income tax returns (and such other required tax filings
as may be agreed to by the parties) by the Fund's tax accountants;
- track book-to-tax differences in the accounting records, if applicable;
- calculate contractual expenses (e.g., advisory fees);
- calculate the incentive allocation, if applicable, pursuant to the terms of
the Fund's Limited Partnership Agreement, and provide a monthly estimate of
accruals;
- determine and periodically monitor the Fund's income and expense accruals
and cause all appropriate expenses to be paid from Fund assets on proper
authorization from the Fund;
- calculate net asset values of the Fund (i) in accordance with the Fund's
operating documents as provided to the Administrator, and (ii) based on
security valuations provided by the pricing service(s), the Portfolio Funds
in which the Fund invests and the Fund's investment adviser, if applicable,
as provided herein;
- maintain all general ledger accounts and related subledgers;
- maintain the accounts, books and other documents produced by the
Administrator in connection with its services hereunder;
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- provide such reports as mutually agreed upon by the parties hereto;
- generally assist in the Fund's administrative operations as mutually agreed
to by the parties.
The duties of the Administrator shall be confined to those expressly set forth
herein, and no implied duties are assumed by or may be asserted against the
Administrator hereunder.
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SCHEDULE B
TO THE
ADMINISTRATION, FUND ACCOUNTING AND RECORDKEEPING AGREEMENT
BY AND BETWEEN
HATTERAS MULTI-STRATEGY INSTITUTIONAL TEI FUND, L.P.
AND
UMB FUND SERVICES, INC.
ANNUAL ASSET-BASED FEE ("40 ACT" REGISTERED MASTER)
- First $150 million of assets .100%
- Next $350 million .075%
- Over $500 million .060%
The annual asset based fee will be calculated based upon the ending of the
month's assets and payable monthly. Administrative services include the
"regulatory" services for a registered "40 Act" fund.
MONTHLY MINIMUM FEE ("MASTER") $7,000
Excludes investor services, optional services, out-of-pocket expenses and other
related expenses - see below.
"REGISTERED" FEEDER FEES
Accounting and Administration monthly fee (per feeder) $3,000
Regulatory Administration monthly fee (per feeder) $2,500
FEEDER FEES (NON-REGISTERED FEEDERS)
Accounting and Administration monthly fee (per feeder) $3,000
INVESTOR SERVICES
Annual Investor Servicing fees (per Hatteras complex):
- For each of the first 500 investors $150
- For each of the next 500 investors $100
- For each of the next 500 investors $ 80
- For each investor over 1,500 investors $ 65
The fees will be determined on the aggregate total of the investors in the
Hatteras Feeder funds and allocated to each Feeder based on its respective
percentage of the number
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of investors on a monthly basis.
Transaction fees:
- Initial one-time setup for each new account $6.50
- Maintenance transaction fees (address changes, subsequent
purchase, etc.) $2.50
Transaction fees will be determined on a per-fund basis and billed monthly.
Coordination of tax preparation with auditors:
Provide capital account allocations and activity for each partner to audit firm
for preparation of partnership tax return and K-1s $1,500 per partnership
OPTIONAL SERVICES
ANNUAL FEDERAL TAX PREPARATION BY UMB
- For the "Master Fund" (Form 1065 and K-1s) $25,000
- Per fund for each of the Feeders (Form 1065 only) $25,000
- For each K-1 for the first 600 investors within
each fund $ 75
- For each K-1 for the next 600 investors $ 60
- For each K-1 over 1,200 investors $ 50
ESTIMATED FEDERAL TAX K-I REPORTS TO INVESTORS AND STATE RETURNS TAX FILINGS
To be negotiated, depending on type of format and amount of information
required.
BLUE SKY STATE FILING FEES$200 per state filing
USA PATRIOT ACT (AML) FEES
- Per fund (per year) $2,000
- Suspicious Activity Report filing (per occurrence) $ 25
OUT-OF-POCKET EXPENSES AND OTHER RELATED EXPENSES
Out-of-pocket expenses and other related expenses include but are not limited
to: pricing services and printing of reports, etc.; photocopying; express
delivery charges; and travel on behalf of company business; record
retention/storage/retrieval expenses, including but not limited to attorney's
fees, incurred in connection with responding to and complying with SEC or other
regulatory investigations, inquiries or subpoenas, excluding routine
examinations of UMB FS in its role as administrator. Additional fees at $200 per
hour
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or as quoted by project may apply for special programming to meet your servicing
requirements, actions taken by the Administrator to correct, verify or address
any prior actions or inactions by the Fund or by any prior service provider or
to create custom reports.
**The minimum monthly fee is subject to an annual escalation equal to the
increase in the Consumer Price Index - Urban Wage Earners (CPI) (but not to
exceed five percent (5.0%) per annum), which escalation shall be effective
commencing one year from the date of this Agreement (the "Anniversary Date") and
on the corresponding Anniversary Date each year thereafter. No amendment of this
Schedule B shall be required with each escalation. CPI shall be determined by
reference to the Consumer Price Index News Release issued by the Bureau of Labor
Statistics, U.S. Department of Labor. If the Fund intends to trade securities on
a foreign exchange, or hold securities denominated in foreign currencies, there
will be an annual fund accounting surcharge of $4,000 per Fund. The foregoing
fee schedule assumes a single class of shares for the Fund. Additional fees
shall apply when adding any additional Funds and/or classes, including
compensation for the Administrator's services in connection with the
organization of the new Fund(s) or classes. The Administrator shall provide such
services and be entitled to such compensation as the parties may mutually agree
in writing.
ASSUMPTIONS
- Each fund's portfolio will be valued and financial statements will be
prepared monthly.
- Included are the trial balance preparation and calculation of net asset
values.
- Preparation of annual reports, hosting of annual audit.
- Preparation of audit package.
- The Feeder Funds' only investment will be in the Master Fund.
- Data to be converted is complete, reconciled and facilitated
electronically.
LIST OF REGULATORY ADMINISTRATIVE SERVICES FOR THE REGISTERED FUNDS
- Coordinate the preparation of material for Board meetings.
- Draft agendas with counsel for Board meetings.
- Attend Board meetings and, with counsel, prepare draft of meeting minutes.
- Maintain the funds' files, calendars for regulatory filings, and Board
approvals of various items.
- Assist fund counsel in preparing filings for tender offers.
- Assist fund counsel in preparing notices and proxy statement for Annual
Meeting, if applicable.
- Assist in the amendment of the fund's registration statement, if required.
- Prepare and file N-SAR, N-CSR, and N-Q; file N-PX.
- Assist the funds in obtaining fidelity bonds and directors' E&O insurance
policies.
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