EXHIBIT 10.4
EXHIBIT C
REPRESENTATION AGREEMENT CONCERNING THE
REGISTRATION STATEMENT AND THE PROSPECTUS
AGREEMENT dated as of the ___ day of _________, 1998,
by and among World Monitor Trust - Series B (the "Trust"), a
business trust organized under Chapter 38 of Title 12 of the
Delaware Code (the "Delaware Act"), Prudential Securities
Incorporated, a Delaware corporation ("Prudential
Securities"), Prudential Securities Futures Management Inc.,
a Delaware corporation (the "Managing Owner"), Wilmington
Trust Company, a Delaware corporation (the "Trustee") and
Eclipse Capital Management, Inc., a Kentucky corporation
(the "Advisor").
W I T N E S S E T H :
WHEREAS, the Trust proposes to make an initial public
offering (the "Offering") of limited liability interests in
the Trust (the "Interests") issuable in multiple series (the
"Series"), each separately managed by a different
professional commodity trading advisor through Prudential
Securities Incorporated ("Prudential Securities"), an
affiliate of the Managing Owner and in connection therewith,
the Trust intends to file with the United States Securities
and Exchange Commission (the "SEC"), pursuant to the United
States Securities Act of 1933, as amended (the "1933 Act"),
a registration statement on Form S-1 to register the
Interests in Series B, and as a part thereof a prospectus
(which registration statement, together with all amendments
thereto, shall be referred to herein as the "Registration
Statement" and which prospectus in final form, together with
all amendments and supplements thereto, shall be referred to
herein as the "Prospectus"); and
WHEREAS, the Trust and the Managing Owner entered into
an agreement with the Advisor, dated as of ________________,
1998 (the "Advisory Agreement"), pursuant to which the
Advisor has agreed to act as a commodity trading advisor to
the Trust with respect to the portion of the Trust Estate
represented by Series B Interests; and
WHEREAS, the parties hereto wish to set forth their
duties and obligations to each other with respect to the
Registration Statement as of its effective date and the
Prospectus as of the date(s) on which subscribers' funds are
transferred to the portion of the Trust Estate represented
by Series B Interests ("Closing dates(s)").
NOW, THEREFORE, the parties agree as follows:
1. Representations and Warranties of the Advisor. The
Advisor hereby represents and warrants to Prudential
Securities, the Trust, the Trustee and the Managing Owner
that:
a. All references in the Registration Statement
as of its effective date and the Prospectus as of the
Closing Date to (i) the Advisor and its affiliates and
the controlling persons, shareholders, directors,
officers and employees of any of the foregoing, (ii)
the Advisor's Trading Approach (as defined in the
Advisory Agreement) and (iii) the actual past
performance of discretionary accounts directed by the
Advisor or any principal thereof, including the notes
to the tables reflecting such actual past performance
(hereinafter referred to as the Advisor's "Past
Performance History") are complete and accurate in all
material respects, and as to such persons, the
Advisor's Trading Approach and the Advisor's Past
Performance History, the Registration Statement as of
its effective date and Prospectus as of each Closing Date
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contain all information required to be included
therein by the Commodity Exchange Act, as amended (the
"CE Act"), and the regulations (including
interpretations thereof) thereunder, and do not contain
an untrue statement of a material fact or omit to state
a material fact required to be stated therein or
necessary to make the statements therein (with respect
to the Prospectus, in light of the circumstances in
which they were made) not misleading. The Advisor also
represents and warrants as to the accuracy and
completeness in all material respects of the underlying
data made available by the Advisor to the Trust and the
Managing Owner for purposes of preparing the Pro Forma
Performance tables, it being understood that no
representation or warranty is being made with respect
to the Pro Forma Performance tables or notes thereto.
The term "principal" in this Agreement shall have the
same meaning as that term in Commodity Futures Trading
Commission (the "CFTC") Regulation S 4.10(e) under the
CE Act.
b. The Advisor will not distribute the
Registration Statement, the Prospectus and/or the
selling materials related thereto.
c. This Agreement and the Advisory Agreement have
been duly and validly authorized, executed and
delivered on behalf of the Advisor and each is a valid
and binding agreement enforceable in accordance with
its terms. The performance of the Advisor's
obligations under this Agreement and the consummation
of the transactions set forth in this Agreement, in the
Advisory Agreement and in the Registration Statement as
of its effective date and Prospectus as of the Closing
Date are not contrary to the provisions of the
Advisor's formation documents, or to the best of its
knowledge, any applicable statute, law or regulation of
any jurisdiction, and will
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not result in any violation,
breach or default under any term or provision of any
undertaking, contract, agreement or order to which the
Advisor is a party or by which the Advisor is bound.
d. The Advisor has all governmental and
regulatory licenses, registrations and approvals
required by law as may be necessary to perform its
obligations under the Advisory Agreement and this
Agreement and to act as described in the Registration
Statement as of its effective date and the Prospectus
as of the Closing Date including, without limitation,
registration as a commodity trading advisor under the
CE Act and membership as a commodity trading advisor
with the National Futures Association (the "NFA") and
it will maintain and renew any required licenses,
registrations, approvals or memberships during the term
of the Advisory Agreement.
e. On the date hereof the Advisor is, and at all
times during the term of this Agreement will be, a
corporation duly formed and validly existing and in
good standing under the laws of its jurisdiction of
incorporation and in good standing and qualified to do
business in each jurisdiction in which the nature or
conduct of its business requires such qualifications
and the failure to be so qualified would materially
adversely affect the Advisor's ability to perform its
obligations hereunder or under the Advisory Agreement.
The Advisor has full capacity and authority to conduct
its business and to perform its obligations under this
Agreement, and to act as described in the Registration
Statement as of its effective date and the Prospectus
as of the Closing Date.
f. Subject to adequate assurances of
confidentiality, the Advisor has supplied to or made
available for review by the Managing Owner and
Prudential
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Securities (and if requested by the Managing
Owner and Prudential Securities to its designated
auditor) all documents, statements, agreements and
workpapers requested by them relating to all accounts
covered by the Advisor's Past Performance History in
the Registration Statement as of its effective date and
the Prospectus as of the Closing Date which are in the
Advisor's possession or to which it has access.
g. Without limiting the generality of paragraph
a. of this Section 1, neither the Advisor nor any of
its principals has managed, controlled or directed, on
an overall discretionary basis, the trading for any
commodity account which is required by CFTC regulations
and the rules and regulations under the 1933 Act to be
disclosed in the Registration Statement as of its
effective date and the Prospectus as of the Closing
Date which is not set forth in the Registration
Statement as of its effective date and Prospectus as of
the Closing Date as required.
h. The Advisor does not provide any services to
any persons or conduct any business involving advice
with respect to investments other than Commodities (as
defined in the Advisory Agreement), except as has been
disclosed in writing to the Managing Owner. The
Advisor is not required to be registered as an
investment adviser under the United States Investment
Advisers Act of 1940, as amended (the "Advisers Act"),
but voluntarily may so register in the future.
i. As of the date hereof, there has been no
material adverse change in the Advisor's Past
Performance History as set forth in the Registration
Statement or in the Prospectus under the caption "Past
Performance Information -- The Series" which has not
been communicated in writing to and received by the
Managing Owner and Prudential Securities or their
counsel.
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j. Except for subsequent performance, as to which
no representation is made, since the date of the
Advisory Agreement, (i) there has not been any material
adverse change in the condition, financial or
otherwise, of the Advisor or in the earnings, affairs
or business prospects of the Advisor, whether or not
arising in the ordinary course of business, and (ii)
there have not been any material transactions entered
into by the Advisor other than those in the ordinary
course of its business.
k. Except as disclosed in the Registration
Statement and in the Prospectus, there is no pending,
or to the best of its knowledge, threatened or
contemplated action, suit or proceeding before or by
any court, governmental, administrative or self-
regulatory body or arbitration panel to which the
Advisor or its principals is a party, or to which any
of the assets of the Advisor is subject which
reasonably might be expected to result in any material
adverse change in the condition (financial or
otherwise), business or prospects of the Advisor or
reasonably might be expected to materially adversely
affect any of the material assets of the Advisor or
which reasonably might be expected to (A) impair
materially the Advisor's ability to discharge its
obligations to the Trust, or (B) result in a matter
which would require disclosure in the Registration
Statement and/or Prospectus; and the Advisor has not
received any notice of an investigation by (i) the NFA
regarding non-compliance with its rules or the CE Act,
(ii) the CFTC regarding non-compliance with the CE Act,
or the rules and regulations thereunder, or (iii) any
exchange regarding non-compliance with its rules of
such exchange which investigation reasonably might be
expected to materially impair its ability to discharge
its obligations under this Agreement or the Advisory
Agreement.
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2. Covenants of the Advisor. If, at any time during
the term of the Advisory Agreement, the Advisor discovers
any fact or omission, or any event or change of
circumstances has occurred which would make the Advisor's
representations and warranties in Section 1 inaccurate or
incomplete in any material respect, or which might render
the Registration Statement or Prospectus, with respect to
(i) the Advisor or its principals, (ii) the Advisor's
Trading Approach, or (iii) the Advisor's Past Performance
History, untrue or misleading in any material respect, the
Advisor will provide prompt written notification to the
Trust, the Managing Owner and Prudential Securities of any
such fact, omission, event or change of circumstance, and
the facts related thereto, and it is agreed that the failure
to provide such notification or the failure to continue to
be in compliance with the foregoing representations and
warranties during the term of the Advisory Agreement within
a reasonable time following such notification shall be cause
for the Trust and the Managing Owner to terminate the
Advisory Agreement with the Advisor on prior written notice
to the Advisor. The Advisor also agrees that, during the
term of the Advisory Agreement, from and after the Effective
Date of the Registration Statement and for so long as
Interests in the Trust are being offered, whether during the
Initial Offering Period or during any Subsequent Offering
Period (as those terms are defined in the Prospectus), it
will provide Prudential Securities, the Trust and the
Managing Owner with updated month-end information relating
to the Advisor's Past Performance History, as required to be
disclosed in the performance tables relating to the
performance of the Advisor in the Prospectus under the
caption "Past Performance Information - Series B " beyond
the periods disclosed therein. The Advisor shall use its
best efforts to provide such information within a reasonable
period of time after the end of the month to which such
updated information relates and the information is available
to it.
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3. Modification of Registration Statement or
Prospectus. If any event or circumstance occurs as a result
of which it becomes necessary, in the judgment of the
Managing Owner and Prudential Securities, to amend the
Registration Statement in order to make the Registration
Statement not materially misleading or to amend or to
supplement the Prospectus in order to make the Prospectus
not materially misleading in light of the circumstances
existing at the time it is delivered to a subscriber, or if
it is otherwise necessary in order to permit the Trust to
continue to offer its Interests subsequent to the Initial
Offering Period subject to the limitations set forth in the
Advisory Agreement, the Advisor will furnish such
information with respect to itself and its principals, as
well as its Trading Approach and Past Performance History as
the Managing Owner or Prudential Securities may reasonably
request, and will cooperate to the extent reasonably
necessary in the preparation of any required amendments or
supplements to the Registration Statement and/or the
Prospectus.
4. Advisor's Closing Obligations. On or prior to the
Closing Date with respect to the initial offering of Series
B Interests (the "Initial Closing Date"), and thereafter,
only if requested, on or prior to each closing date during
the continuous offering of Series B Interests (each a
"Subsequent Closing Date"), the Advisor shall deliver or
cause to be delivered, at the expense of the Advisor, to
Prudential Securities, the Trust and the Managing Owner, the
reports, certificates, documents and opinions described
below addressed to them and, except as may be set forth
below, dated the Initial Closing Date or the Subsequent
Closing Date, as appropriate (provided that the Advisor
shall not be obligated to provide an opinion of its counsel
more frequently than once per annum absent good cause
shown). Unless the context otherwise requires, the Initial
Closing Date and each Subsequent Closing Date shall each be
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referred to as a "Closing Date",
a. A report from the Advisor which shall present,
for the period from the date after the last day covered
by the Advisor's Past Performance History as set forth
under "Past Performance Information - Series B " in the
Prospectus to the latest practicable month-end before
the Closing Date, figures which shall show the actual
past performance of the Advisor (or, if such actual
past performance information is unavailable, then the
estimated past performance) for such period, and which
shall certify that, to the best of its knowledge, such
figures are complete and accurate in all material
respects.
b. A certificate of the Advisor in the form
proposed prior to the Closing Date by counsel to
Prudential Securities, the Trust and the Managing
Owner, with such changes in such form as are proposed
by the Advisor or its counsel and are acceptable to
Prudential Securities, the Trust and the Managing Owner
and their counsel so as to make such form mutually
acceptable to Prudential Securities, the Trust, the
Managing Owner, the Advisor, and their respective
counsel, to the effect that:
(i) The representations and warranties of the
Advisor in Section 1 above are true and correct in
all material respects on the date of the
certificate as though made on such date.
(ii) Nothing has come to the Advisor's
attention which would cause the Advisor to believe
that, at any time from the time the Registration
Statement initially became effective to the Closing
Date, the Registration Statement, as amended from
time to time, or the Prospectus, as amended or
supplemented from time to time, with respect to the
Advisor, or the affiliates,
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controlling persons, shareholders, directors, officers or
employees of any of the foregoing, or with respect to the
Advisor's Trading Approach or Past Performance
History, contained an untrue statement of a
material fact or omitted to state a material fact
required to be stated therein or necessary to make
the statements therein (with respect to the
Prospectus, in light of the circumstances in which
they were made) not misleading.
(iii) The Advisor has performed all covenants
and agreements herein contained to be performed on
its part at or prior to the Closing Date.
c. A certificate of the Advisor (together with
such supporting documents as are set forth in the
certificate), in the form proposed prior to the Closing
Date by counsel to Prudential Securities, the Trust and
the Managing Owner, with such changes in such form as
are proposed by the Advisor or its counsel and are
acceptable to Prudential Securities, the Trust and the
Managing Owner and their counsel so as to make such
form mutually acceptable to Prudential Securities, the
Trust, the Managing Owner, the Advisor, and their
respective counsel, with respect to, (i) the continued
effectiveness of the organizational documents of the
Advisor, (ii) the continued effectiveness of the
Advisor's registration as a commodity trading advisor
under the CE Act and membership as a commodity trading
advisor with the NFA and (iii) the incumbency and
genuine signature of the President and Secretary of the
Advisor.
d. A certificate from the state of formation of
the Advisor, to be dated at, on or around the Closing
Date, as to its formation and good standing.
e. An opinion of counsel, in form and substance
satisfactory to the Trust, the Managing Owner and
Prudential Securities and their counsel, dated the
Closing
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Date, to the following effect:
(i) The Advisor is a duly formed and validly
existing corporation in good standing under the
laws of the state of its formation and, if
different, the state where it conducts its primary
business activity. The Advisor has full corporate
power and authority under its Certificate of
Incorporation to perform its obligations under the
Advisory Agreement and this Agreement, and to act
as described in the Registration Statement as of
its effective date and the Prospectus as of the
Closing Date.
(ii) Each of the Advisory Agreement and
this Agreement have been duly and validly
authorized, executed and delivered on behalf of the
Advisor, and assuming the due execution and
delivery of each such Agreement by the Trust and
the Managing Owner, each such agreement constitutes
the legal, valid and binding obligations of the
Advisor, enforceable in accordance with their
respective terms, except as the same may be limited
by bankruptcy, insolvency, reorganization,
moratorium or similar laws at the time in effect
affecting creditors rights generally, or by
applicable principles of equity, whether in an
action at law or in equity, and except that the
enforceability of the indemnification provisions
may be limited under applicable federal or state
securities, commodities and other laws or by public
policy; and the execution and delivery of such
agreements and the incurrence of the obligations
thereunder and the consummation of the transactions
set forth in such agreements and in the Prospectus
will not violate or result in a breach of the
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Advisor's formation documents, and, to the best of
such counsel's knowledge, after due inquiry, will
not result in any violation, breach or default
under any term or provision of any undertaking,
contract, agreement or order to which the Advisor
is a party or by which the Advisor is bound.
(iii) Subject to subparagraph (iv) of this
Section 4e, to the best of such counsel's
knowledge, after due inquiry, the Advisor has
obtained all required governmental and regulatory
licenses, registrations and approvals required by
law as may be necessary in order to perform its
obligations under the Advisory Agreement and this
Agreement and to act as described in the
Registration Statement as of its effective date and
the Prospectus as of the Closing Date (including,
without limitation, registration as a commodity
trading advisor under the CE Act and membership as
a commodity trading advisor with the NFA) and such
licenses, registrations and approvals have not, to
the best of such counsel's knowledge, after due
inquiry, been rescinded, revoked or otherwise
removed.
(iv) Assuming that the Trust is operated
as described in the Prospectus, the Advisor is not
required to be licensed or registered as an
investment adviser under the Advisers Act (even if
it voluntarily is so registered), or to such
counsel's knowledge, without independent
investigation, as an investment adviser or
commodity trading advisor under the Blue Sky
securities laws of any state of the United States,
in order to perform its obligations under the
Advisory Agreement or this Agreement, or to act as
described in the Registration Statement as of its
effective date and the
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Prospectus as of the Closing Date. The foregoing opinion
may be qualified by the fact that such counsel is not
admitted to practice law in all jurisdictions, and that in
rendering its opinion such counsel has relied
solely upon an examination of the Blue Sky
securities laws and related rules and regulations,
if any, promulgated thereunder, of the various
jurisdictions as reported in customarily relied
upon standard compilations.
(v) To such counsel's knowledge without
independent investigation, except as described in
the Prospectus, or in a schedule delivered by
counsel to Prudential Securities and the Managing
Owner prior to the date hereof, there is no
pending, or threatened, suit or proceeding, known
to such counsel, before or by any court,
governmental or regulatory body or arbitration
panel to which the Advisor or any of the assets of
the Advisor or any of its principals is subject and
which reasonably might be expected to result in any
material adverse change in the condition (financial
or otherwise), business or prospects of the Advisor
or any of its principals or reasonably might be
expected materially adversely to affect any of the
assets of the Advisor or any of its principals or
which reasonably might be expected to (A) impair
materially the Advisor's ability to discharge its
obligations to the Trust or (B) result in a matter
which would require disclosure in the Registration
Statement or Prospectus; and, to the best of such
counsel's knowledge, neither the Advisor nor any of
its principals has received any notice of an
investigation by (i) the NFA regarding non-
compliance with its rules or the CE Act, (ii) the
CFTC regarding non-compliance with the CE Act or
(iii) any exchange, regarding non-compliance
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with its rules, which investigation reasonably might be
expected to (A) impair materially the Advisor's
ability to discharge its obligations to the Trust
or (B) result in a matter which would require
disclosure in the Registration Statement or
Prospectus.
(vi) With respect to the Advisor and the
affiliates, controlling persons, shareholders,
directors, officers and employees of any of the
foregoing, and with respect to the Advisor's
Trading Approach, nothing has come to the attention
of such counsel that leads such counsel to believe
that the Registration Statement (at the time it
initially became effective and at the time any
post-effective amendment thereto became effective)
or the Prospectus contains any untrue statement of
a material fact or omits to state a material fact
required to be stated therein or which is necessary
to make the statements therein (with respect to the
Prospectus, in light of the circumstances in which
they are made) not misleading, except that such
counsel is not required to express any opinion or
belief as to the financial statements or other
financial or statistical data, past performance
tables and notes thereto or other past performance
information contained in the Registration Statement
or the Prospectus.
In rendering the foregoing opinions, such counsel may
rely, as to matters of law of states other than that in
which they are licensed to practice law, upon the opinions
of other counsel, in each case satisfactory in form and
substance to counsel to the Managing Owner and Prudential
Securities, and such counsel shall state that they believe
the Managing Owner and Prudential Securities may rely on
them.
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5. Advisor Acknowledgements. The Advisor acknowledges
that: (i) it may be a condition to each closing under the
Underwriting Agreement that Prudential Securities shall have
received, at no cost to the Advisor, letter(s) from
certified public accountants or other reputable
professionals selected by Prudential Securities with respect
to the Past Performance History of the Advisor as set forth
in the Underwriting Agreement, (ii) the Trust may at any
time withdraw the Registration Statement from the SEC or
otherwise terminate the Registration Statement or the
offering of Interests, and upon any such withdrawal or
termination or if the "minimum" number of Interests, as
described in the Prospectus, is not sold, this Agreement
shall terminate and none of the parties hereto shall have
any obligation to any other party pursuant to this
Agreement, except pursuant to Section 10 of this Agreement
to the extent that such section is applicable.
6. Representations and Warranties of the Trust and the
Managing Owner. The Managing Owner hereby represents and
warrants (on its own behalf and on behalf of the Trust, as
applicable) to the Advisor that:
a. On the date hereof the Trust is, and at all
times during the term of this Agreement and the
Advisory Agreement will be, a duly formed and validly
existing business trust in good standing under the laws
of the State of Delaware, and at all times during the
term of this Agreement and the Advisory Agreement will
be in good standing and qualified to do business in
each jurisdiction in which the nature or conduct of its
business requires such qualifications and the failure
to be so qualified materially adversely would affect
its ability to perform its obligations under this
Agreement and the Advisory Agreement and to operate as
described in the Prospectus,
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and the Managing Owner is, and at all times during the term
of this Agreement and the Advisory Agreement will be, a duly
formed and validly existing corporation in good standing under
the laws of the State of Delaware, and is, and at all times
during the term of this Agreement and the Advisory
Agreement will be, in good standing and qualified to do
business as a foreign corporation in the State of New
York and each other jurisdiction in which the nature or
conduct of its business requires such qualifications
and the failure to be so qualified materially adversely
would affect its ability to act as Managing Owner of
the Trust and perform its obligations hereunder and
under the Advisory Agreement, and each has full
capacity and authority to conduct its business and to
perform its obligations under this Agreement and the
Advisory Agreement, and to act as described in the
Registration Statement as of its effective date and the
Prospectus as of the Closing Date.
b. Each of this Agreement and the Advisory
Agreement has been duly and validly authorized,
executed and delivered on behalf of the Trust and the
Managing Owner, is a valid and binding agreement of the
Trust and the Managing Owner, and is enforceable in
accordance with its terms. The performance of the
Trust's and the Managing Owner's obligations under this
Agreement and the Advisory Agreement, and the
consummation of the transactions set forth in this
Agreement and the Advisory Agreement, and in the
Registration Statement as of its effective date and
Prospectus as of the Closing Date are not contrary to
the provisions of the Trust's Trust Agreement,
Certificate of Trust or the Managing Owner's
Certificate of Incorporation or By-Laws, respectively,
any applicable statute, law or regulation of any
jurisdiction and will not result in any violation,
breach or default under any term or provision of any
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undertaking, contract, agreement or order, to which the
Trust or the Managing Owner, is a party or by which the
Trust or the Managing Owner is bound.
c. Each of the Trust and the Managing Owner has
obtained all required governmental and regulatory
licenses, registrations and approvals required by law
as may be necessary to perform their obligations under
this Agreement and the Advisory Agreement and to act as
described in the Registration Statement as of its
effective date and the Prospectus as of the Closing
Date (including, without limitation, the Managing
Owner's registration as a commodity pool operator under
the CE Act and membership as a commodity pool operator
with the NFA) and will maintain and renew any required
licenses, registrations, approvals and memberships
required during the term of this Agreement and the
Advisory Agreement.
d. The Trust is not required to be registered as
an investment company under the United States
Investment Company Act of 1940, as amended (the
"Investment Company Act").
e. All authorizations, consents or orders of any
court, or of any federal, state or other governmental
or regulatory agency or body required for the valid
authorization, issuance, offer and sale of the
Interests have been obtained, and, no order preventing
or suspending the use of the Prospectus with respect to
the Interests has been issued by the SEC, the CFTC or
the NFA. The Registration Statement as of its
effective date and the Prospectus as of the Closing
Date contain all statements which are required to be
made therein, conform in all material respects with the
requirements of the 1933 Act and the CE Act, and the
rules and regulations of the SEC and the CFTC,
respectively thereunder, and with the rules of the NFA,
and do
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not contain an untrue statement of a material
fact or omit to state a material fact required to be
stated therein or necessary to make the statements
therein (with respect to the Prospectus, in light of
the circumstances in which they are made) not
misleading; and at all times subsequent hereto up to
and including the date of termination of the Initial
Offering Period and any Subsequent Offering Period, the
Registration Statement as of its effective date and the
Prospectus as of the Closing Date will contain all
statements required to be made therein and will conform
in all material respects with the requirements of the
1933 Act and the CE Act, and the rules and regulations
of the SEC and the CFTC, respectively thereunder, and
with the rules of the NFA and will not contain any
untrue statement of a material fact or omit to state a
material fact required to be stated therein (with
respect to the Prospectus, in light of the
circumstances in which they are made) not misleading;
provided, however, that this representation and
warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with
information furnished to the Managing Owner, the Trust
or to Prudential Securities by or on behalf of the
Advisor for the express purpose of inclusion in the
Registration Statement or the Prospectus, including,
without limitation, references to the Advisor and its
affiliates, controlling persons, shareholders,
directors, officers and employees, as well as to the
Advisor's Trading Approach and Past Performance
History.
f. The Registration Statement as of its effective
date and the Prospectus as of the Closing Date have
been delivered to the Advisor.
g. There is no pending, or its knowledge,
threatened or contemplated action, suit or proceeding
before any court or arbitration panel, or before or by any
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governmental, administrative or self-regulatory
body, to which the Trust, the Managing Owner, or the
principals of either is a party, or to which any of the
assets of any of the foregoing persons is subject,
which might reasonably be expected to result in any
material adverse change in their condition (financial
or otherwise), business or prospects or reasonably
might be expected to affect adversely in any material
respect any of their assets or which reasonably might
be expected to materially impair their ability to
discharge their obligations under this Agreement or the
Advisory Agreement; and neither the Trust nor the
Managing Owner has received any notice of an
investigation by (i) the NFA regarding non-compliance
with NFA rules or the CE Act, (ii) the CFTC regarding
non-compliance with the CE Act, or the rules and
regulations thereunder, or (iii) any exchange regarding
non-compliance with the rules of such exchange which
investigation reasonably might be expected to
materially impair the ability of each of the Trust and
the Managing Owner to discharge its obligations under
this Agreement or the Advisory Agreement.
7. Covenants of the Managing Owner and the Trust. If,
at any time during the term of the Advisory Agreement, the
Managing Owner or the Trust discovers any fact or omission,
or any event or change of circumstance has occurred which
would make the Managing Owner's or the Trust's
representations and warranties in Section 6 of this
Agreement inaccurate or incomplete in any material respect,
the Trust or the Managing Owner, as appropriate, promptly
will provide written notification to the Advisor of such
event or change of circumstance and the facts related
thereto. The Managing Owner and the Trust shall provide the
Advisor with a copy of each amendment to the Registration
Statement and
19
amendment or supplement to the Prospectus, and
no amendment to the Registration Statement or amendment or
supplement to the Prospectus which contains any statement or
information regarding the Advisor will be filed or used
unless the Advisor has received reasonable prior notice and
a copy thereof and has consented in writing to such
statement or information being filed and used.
8. Trust's and Managing Owner's Closing Obligations.
On or prior to the Initial Closing Date, and thereafter on
or prior to each Subsequent Closing Date, if the Trust and
the Managing Owner have requested that the Advisor provide
certificates, documents and opinions pursuant to Section 4
hereof, the Trust and the Managing Owner shall deliver or
cause to be delivered to the Advisor, the certificates,
documents and opinions described below addressed to the
Advisor and, except as may be set forth below, dated each
such Closing Date:
a. Certificates of the Trust and the Managing
Owner, addressed to the Advisor, in the form proposed
prior to the Closing Date by counsel to the Trust and
the Managing Owner with such changes in such form as
are proposed by the Advisor or its counsel and are
acceptable to the Trust, the Managing Owner and their
counsel so as to make such form mutually acceptable to
the Trust, the Managing Owner, the Advisor, and their
respective counsel, with respect to, as applicable, (i)
the continued effectiveness of the Trust Agreement and
the Certificate of Trust of the Trust and the
Certificate of Incorporation and By-Laws of the
Managing Owner, (ii) the continued effectiveness of the
registration of the Managing Owner as a commodity pool
operator under the CE Act and membership as a commodity
pool operator with the NFA and
20
(iii) the incumbency and
genuine signature of the President and Secretary of the
Managing Owner.
b. Certificates from the States of Delaware and
New York with respect to each of the Trust and the
Managing Owner to be dated at, on or around the Closing
Date as to the formation and good standing of the Trust
and the Managing Owner.
c. Certificates of the Trust and the Managing
Owner in the form proposed prior to the Closing Date by
counsel to the Trust and the Managing Owner with such
changes in such form as are proposed by the Advisor or
its counsel and are acceptable to the Trust, the
Managing Owner and their counsel so as to make such
form mutually acceptable to the Trust, the Managing
Owner, the Advisor, and their respective counsel, to
the effect that:
(i) The representations and warranties in
Section 6 above are true and correct in all
material respects on the date of the certificates
as though made on such date, and
(ii) The Trust and the Managing Owner have
each performed all covenants and agreements herein
contained to be performed on their part at or prior
to the Closing Date.
d. An opinion letter of Rosenman & Colin LLP,
dated the Closing Date, as follows:
(i) The Trust is a duly created and validly
existing business trust in good standing under the
Delaware Act, with requisite power and authority
under the Delaware Act, its Trust Agreement and its
Certificate of Trust to
21
perform its obligations under this Agreement and the
Advisory Agreement, and to act as described in the
Registration Statement as of its effective date and the
Prospectus as of the Closing Date.
(ii) The Managing Owner is a duly formed
and validly existing corporation in good standing
under the laws of the State of Delaware; and is
duly qualified to conduct business as a foreign
corporation in good standing in the State of New
York. The Managing Owner has full corporate power
and authority under its Certificate of
Incorporation, By-Laws and the General Corporation
Law of the State of Delaware to perform its
obligations under this Agreement and the Advisory
Agreement, and to act as described in the
Registration Statement as of its effective date and
the Prospectus as of the Closing Date.
(iii) Each of this Agreement and the Advisory
Agreement has been duly and validly authorized or
ratified, executed and delivered on behalf of each
of the Trust and the Managing Owner, and, assuming
due execution and delivery of each such Agreement
by the Advisor, each agreement constitutes the
legal, valid and binding obligations of the Trust
and the Managing Owner, respectively, enforceable
in accordance with their respective terms, except
as the same may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar
laws at the time in effect affecting creditors
rights generally, or by applicable principles of
equity, whether in an action at law or in equity,
and except that the enforceability of the
indemnification provisions may be limited under
applicable federal or state securities, commodities
and other laws or by
22
public policy; and the execution and delivery of such
agreements and incurrence of the obligations thereunder
and the consummation of the transactions set forth in such
agreements and in the Prospectus will not violate
or result in a breach of their formation documents,
and, to the best of such counsel's knowledge, after
due inquiry, will not result in any violation,
breach or default under any term or provision of
any undertaking, contract, agreement or order to
which they are parties or by which they are bound.
(iv) The Trust is not required to be
registered as an investment company under the
Investment Company Act in order to act as described
in the Registration Statement as of its effective
date and the Prospectus as of the Closing Date or
to perform its obligations under this Agreement or
the Advisory Agreement.
(v) To the best of such counsel's knowledge,
after due inquiry, all authorizations, consents or
orders of any court or of any federal, state or
other governmental or regulatory agency or body
required for the valid authorization, issuance,
offer and sale of Interests have been obtained,
including such as may be required under the 1933
Act, including the rules and regulations
thereunder, the CE Act, including the rules and
regulations thereunder, the rules and regulations
of the NFA or the "Blue Sky" securities laws of any
state or of any jurisdiction in which offers and
sales were made, and, to the extent of such
counsel's knowledge, no order suspending the
effectiveness of the Registration Statement or the
use of the Prospectus has been issued by the SEC,
the CFTC, the NFA or any state in which offers and
sales of Interests were made nor has
23
any proceeding for the issuance of such an order been
instituted or threatened by the SEC, the CFTC, the NFA,
or any such state. The foregoing may be qualified by the
fact that such counsel is not admitted to practice
law in all jurisdictions, and that in rendering its
opinion such counsel shall rely solely upon an
examination of the "Blue Sky" securities laws and
related rules, regulations and administrative
determinations, if any, promulgated thereunder, of
the various jurisdictions as reported in
customarily relied upon standard compilations, and
upon such counsel's understanding of the various
conclusions expressed, formally or informally, by
administrative officials or other employees of the
various regulatory or other governmental agencies
or authorities concerned.
(vi) To the best of such counsel's
knowledge, after due inquiry, each of the Trust and
the Managing Owner has obtained all required
governmental and regulatory licenses, registrations
and approvals required by law as may be necessary
in order for each of the Trust and the Managing
Owner to perform its obligations under this
Agreement and under the Advisory Agreement and to
act as described in the Registration Statement as
of its effective date and the Prospectus as of the
Closing Date (including, without limitation, the
Managing Owner's registration as a commodity pool
operator under the CE Act and membership as a
commodity pool operator with the NFA) and such
licenses, registrations and approvals have not, to
the best of such counsel's knowledge, after due
inquiry, been rescinded, revoked or otherwise
removed.
24
(vii) To such counsel's knowledge without
independent investigation, except as described in
the Prospectus, or in a schedule delivered by
counsel to Prudential Securities and the Managing
Owner prior to the date hereof, there is no
pending, or threatened, suit or proceeding, known
to such counsel, before or by any court,
governmental or regulatory body or arbitration
panel to which the Trust and the Managing Owner or
any of the assets of the Trust or the Managing
Owner or any of their principals is subject and
which reasonably might be expected to result in any
material adverse change in the condition (financial
or otherwise), business or prospects of the Trust
or Managing Owner or any of their principals or
reasonably might be expected materially adversely
to affect any of the assets of the Trust or
Managing Owner or any of their principals or which
reasonably might be expected to (A) impair
materially the Trust's or Managing Owner's ability
to discharge their obligations to the Advisor or
(B) result in a matter which would require
disclosure in the Registration Statement or
Prospectus which is not so disclosed; and, to the
extent of such counsel's knowledge, neither the
Trust or Managing Owner, nor any of their
principals has received any notice of an
investigation by (i) the NFA regarding non-
compliance with its rules or the CE Act, (ii) the
CFTC regarding non-compliance with the CE Act or
(iii) any exchange, regarding non-compliance with
its rules, which investigation reasonably might be
expected to (A) impair materially the Trust's or
Managing Owner's ability to discharge its
obligations to the Advisor or (B) result in a
matter which would require disclosure in the
Registration Statement or Prospectus which is not
so
25
disclosed.
(viii) The Registration Statement as of its
effective date and the Prospectus as of the Closing
Date are responsive in all material respects to the
requirements of the 1933 Act, including the rules
and regulations thereunder, the CE Act, including
the rules and regulations thereunder, and the rules
and regulations of the NFA, and nothing has come to
the attention of such counsel that leads it to
believe that either the Registration Statement (at
the time it initially became effective and at the
time any post-effective amendment thereto became
effective) or the Prospectus contains any untrue
statement of a material fact or omits to state a
material fact required to be stated therein or
which is necessary to make the statements therein
(with respect to the Prospectus, in light of the
circumstances in which they were made) not
misleading, except that such counsel is not
required to express any opinion or belief (A) as to
the financial statements or other financial or
statistical data, past performance tables and notes
thereto or other past performance information
contained in the Registration Statement or the
Prospectus, or (B) as to any statements or
omissions made in reliance on and in conformity
with information furnished by the Advisor for the
express purpose of inclusion in the Registration
Statement or the Prospectus, including, without
limitation, references to the Advisor and its
affiliates, controlling persons, shareholders,
directors, officers and employees, as well as to
the Advisor's Trading Approach and Past Performance
History.
26
In rendering such opinions, such counsel may rely, as
to matters of law of states other than that in which they
are licensed to practice law, upon the opinions of other
counsel, in each case satisfactory in form and substance to
the Advisor and its counsel, and such counsel shall state
that they believe the Advisor may rely on them.
9. Survival of Representations, Warranties and
Covenants. All representations, warranties and covenants in
this Agreement, or contained in certificates required to be
delivered hereunder, shall survive the delivery of any
payment for the Interests under the Underwriting Agreement
and the termination of the Advisory Agreement and this
Agreement, with respect to any matter arising while the
Advisory Agreement or this Agreement was in effect.
Furthermore, all representations, warranties and covenants
hereunder shall inure to the benefit of each of the parties
to this Agreement and their respective successors and
permitted assigns.
10. Indemnification.
a. In any action in which Prudential Securities,
the Trust, the Trustee or the Managing Owner, or the
controlling persons, shareholders, partners, directors,
officers and/or employees of any of the foregoing are
parties, the Advisor agrees (A) to indemnify and hold
harmless the foregoing persons against any loss, claim,
damage, charge, liability or expense (including,
without limitation, reasonable attorneys' and
accountants' fees) to which such persons may become
subject ("Losses"), insofar as such Losses arise out of
or are based exclusively upon (i) any misrepresentation
or material breach of any warranty, covenant or
agreement of the Advisor contained in this Agreement or
(ii) any untrue statement of any material fact
contained in the
27
Registration Statement or the Prospectus or the omission to
state in the Registration Statement or the Prospectus a material
fact required to be stated therein or necessary to make the
statements therein (with respect to the Prospectus, in light of
the circumstances in which they are made), not
misleading in each case under this subclause (ii) to
the extent, but only to the extent, that such untrue
statement or omission was made in reliance upon and in
material conformity with information furnished by the
Advisor to the Managing Owner for inclusion in the
Registration Statement or Prospectus, including,
without limitation, all information relating to the
Advisor and its affiliates, controlling persons,
shareholders, directors, officers and employees, as
well as to the Advisor's Trading Approach and Past
Performance History, and including, but not limited to,
any notification by the Advisor to any such person and
given under this Agreement, including liabilities under
the 1933 Act, the Exchange Act and the CE Act, and (B)
to reimburse each of the foregoing persons for any
legal or other fees or expenses reasonably incurred in
connection with investigating or defending any action
or claim arising out of or based upon any of the
foregoing.
b. In any action in which the Advisor, or the
controlling persons, shareholders, directors, officers
and/or employees of any of the foregoing (the "Advisor
Indemnified Parties") are parties, the Managing Owner
agrees (A) to indemnify and hold harmless the foregoing
persons against any loss, claim, damage, charge,
liability or expense (including, without limitation,
reasonable attorneys' and accountants' fees) to which
such persons may become subject ("Losses"), insofar as
such Losses arise out of or are based exclusively upon
(i) any misrepresentation or
28
material breach of any warranty, covenant or agreement of
the Trust or the Managing Owner contained in this Agreement,
(ii) any untrue statement of any material fact contained in the
Registration Statement or the Prospectus or the
omission to state in the Registration Statement or the
Prospectus a material fact required to be stated
therein or necessary to make the statements therein
(with respect to the Prospectus, in light of the
circumstances in which they are made), not misleading,
(iii) any failure to comply with any legal requirements
relating to the Offering of the Interests (including
without limitation, any noncompliance with the
requirements of the Exchange Act, and/or the 1933 Act,
and/or the CE Act, including the rules and regulations
thereunder, and or the rules and regulation of the NFA,
in each case with respect to the Offering of
Interests), or (iv) any claim relating to or involving
the Advisor that is not substantiated, resolved or
otherwise finally determined, in each case under
subclauses (ii), (iii) or (iv) hereof, except to the
extent that such untrue statement, omission or failure
was made in reliance upon and in material conformity
with information furnished by the Advisor to the
Managing Owner for inclusion in the Registration
Statement or the Prospectus including, without
limitation, all information relating to the Advisor and
its affiliates, controlling persons, shareholders,
directors, officers and employees, as well as to the
Advisor's Trading Approach and Past Performance
History, and including but not limited to, any
notification required and given under this Agreement,
including liabilities under the 1933 Act, the Exchange
Act and the CE Act, and (B) to reimburse each of the
Advisor Indemnified Parties for any legal or other fees
or expenses reasonably incurred in connection with
investigating or defending any action or claim arising
out of or based upon any of the foregoing. With
29
respect to subclause (iv) above only, the Advisor and
the Managing Owner agree to negotiate in good faith a
reduction, if any, in the indemnification amount
required to be paid to the Advisor based upon the
relative responsibility of the Advisor for
circumstances giving rise to the Losses for which
indemnification is sought (including, but not limited
to, the parties' assessment of the merits of the
claim), provided that in the event the Managing Owner
and the Advisor fail to agree on the amount of such
reductions, they shall submit the matter to arbitration
in accordance with Section 15 of this Agreement.
c. None of the indemnifications contained in this
Section 10 shall be applicable with respect to default
judgments or confessions of judgment, or to settlements
entered into by an indemnified party claiming
indemnification without the prior written consent of
the indemnifying party.
d. Promptly after receipt by an indemnified party
under this Section 10 of notice of any claim or dispute
or commencement of any action or litigation, such
indemnified party will, if a claim in respect thereof
is to be made against an indemnifying party under this
Section 10, notify the indemnifying party of the
commencement thereof; but the omission to notify the
indemnifying party will not relieve it from any
liability which it may have to any indemnified party
otherwise than under this Section 10 except to the
extent, if any, that such failure or delay prejudiced
the indemnifying party in defending against the claim.
In case any such claim, dispute, action or litigation
is brought or asserted against any indemnified party,
and it timely notifies the indemnifying party of the
commencement thereof, the indemnifying party will be
entitled to participate in the defense therein, and to
the extent that it may
30
wish, to assume such defense thereof, with counsel specifically
approved in writing by such indemnified party, such approval
not to be unreasonably withheld, following notice from the
indemnifying party to such indemnified party of its
election so to assume the defense thereof; in which
event, the indemnifying party will not be liable to
such indemnified party under this Section 10 for any
legal or other expenses subsequently incurred by such
indemnified party in connection with the defense
thereof, but shall continue to be liable to the
indemnified party in all other respects as heretofore
set forth in this Section 10. Notwithstanding any
other provisions of this Section 10, if, in any claim,
dispute, action or litigation as to which indemnity is
or may be available, any indemnified party reasonably
determines that its interests are or may be, in whole
or in part, adverse to the interests of the
indemnifying party, the indemnified party may retain
its own counsel in connection with such claim, dispute,
action or litigation and shall continue to be
indemnified by the indemnifying party for any legal or
any other expenses reasonably incurred in connection
with investigating or defending such claim, dispute,
action or litigation.
e. Expenses incurred by an indemnified party in
defending a threatened or asserted claim or a
threatened or pending action shall be paid by the
indemnifying party in advance of final disposition or
settlement of such matter, if and to the extent that
the person on whose behalf such expenses are paid shall
agree in writing to reimburse the indemnifying party in
the event indemnification is not permitted under this
Section 10 upon final disposition or settlement.
f. The parties hereto acknowledge and agree on
their own behalf that the indemnities provided in this
Agreement shall be inapplicable in the event of any loss,
31
claim, damage, charge or liability arising out of
or based upon, but limited to the extent caused by, any
misrepresentation or breach of any warranty, covenant
or agreement of any indemnified party to any
indemnifying party contained in this Agreement.
11. Limits on Claims. The Advisor agrees that it will
not take any of the following actions against the Trust:
(i) seek a decree or order by a court having jurisdiction in
the premises (A) for relief in respect of the Trust in an
involuntary case or proceeding under the Federal Bankruptcy
Code or any other federal or state bankruptcy, insolvency,
reorganization, rehabilitation, liquidation or similar law
or (B) adjudging the Trust a bankrupt or insolvent, or
seeking reorganization, rehabilitation, liquidation,
arrangement, adjustment or composition of or in respect of
the Trust under the Federal Bankruptcy Code or any other
applicable federal or state law, or appointing a custodian,
receiver, liquidator, assignee, trustee, sequestrator (or
other similar official) of the Trust or of any substantial
part of any of its properties, or ordering the winding up or
liquidation of any of its affairs, or (ii) seek a petition
for relief, reorganization or to take advantage of any law
referred to in the preceding clause or (iii) file an
involuntary petition for bankruptcy (collectively
"Bankruptcy or Insolvency Action"). In addition, the
Advisor agrees that for any obligations due and owing to it
by the Trust, the Advisor will look solely and exclusively
to the assets of Series B or the Managing Owner, if it has
liability in its capacity as Managing Owner, to satisfy its
claims and will not seek to attach or otherwise assert a
claim against the assets of any other Series or the other
assets of the Trust, whether there is a Bankruptcy or
Insolvency Action taken. The parties agree that this
provision will survive the termination of this Agreement, whether
32
terminated in a Bankruptcy or Insolvency Action or
otherwise.
12. Subordination Agreement. Each of the Advisor, the
Managing Owner and the Trustee ("Potential Creditor(s)")
agrees and consents (the "Consent") to look solely to each
Series for which brokerage and clearing services are being
performed (the "Contracting Series") and assets (the
"Contracting Series Assets") of the Contracting Series and
to the Managing Owner and its assets for payment. The
Contracting Series Assets include only those funds and other
assets that are paid, held or distributed to the Trust on
account of and for the benefit of the Contracting Series,
including, without limitation, funds delivered to the Trust
for the purchase of interests in a Series. In furtherance
of the Consent, the Potential Creditors agree that (i) any
debts, liabilities, obligations, indebtedness, expenses and
claims of any nature and of all kinds and descriptions
(collectively, "Claims") incurred, contracted for or
otherwise existing arising from, related to or in connection
with the Trust and its assets and the Contracting Series and
the Contracting Series Assets, shall be subject to the
following limitations:
a. Subordination of certain claims and rights.
(i) except as set forth below, the Claims, if any, of
the Potential Creditors (the "Subordinated Claims")
shall be expressly subordinate and junior in right of
payment to any and all other Claims against the Trust
and any Series thereof, and any of their respective
assets, which may arise as a matter of law or pursuant
to any contract; provided, however, that the Potential
Creditors' Claims (if any) against the Contracting
Series shall not be considered Subordinated Claims with
respect to enforcement against and distribution and
repayment from the Contracting Series, the Contracting
Series Assets and the Managing Owner and its assets;
and provided further that the Potential Creditors'
valid
33
Claims, if any, against the Contracting Series
shall be pari passu and equal in right of repayment and
distribution with all other valid Claims against the
Contracting Series and (ii) the Potential Creditors,
individually or collectively, will not take, demand or
receive from any Series or the Trust or any of their
respective assets (other than the Contracting Series,
the Contracting Series Assets and the Managing Owner
and its assets) any payment for the Subordinated
Claims;
b. the Claims of each of the Potential Creditors
with respect to the Contracting Series shall only be
asserted and enforceable against the Contracting
Series, the Contracting Series Assets and the Managing
Owner and its assets; and such Claims shall not be
asserted or enforceable for any reason whatsoever
against any other Series, the Trust generally or any of
their respective assets;
c. if the Claims of a Potential Creditor against
the Contracting Series or the Trust are secured in
whole or in part, each of the Potential Creditors
hereby waives (under section 1111(b) of the Bankruptcy
Code (11 U.S.C. S 1111(b)) any right to have any
deficiency Claims (which deficiency Claims may arise in
the event such security is inadequate to satisfy such
Claims) treated as unsecured Claims against the Trust
or any Series (other than the Contracting Series), as
the case may be;
d. in furtherance of the foregoing, if and to the
extent that the Potential Creditors receive monies in
connection with the Subordinated Claims from a Series
or the Trust (or their respective assets), other than
the Contracting Series, the Contracting Series Assets
and the Managing Owner and its assets, the Potential
Creditors shall be deemed to hold such monies in trust
and shall promptly remit such monies to the Series or
the Trust that paid such amounts for distribution by
the Series or the Trust in accordance with the terms
hereof; and
34
e. the foregoing Consent shall apply at all times
notwithstanding that the Claims are satisfied, and
notwithstanding that the agreements in respect of such
Claims are terminated, rescinded or canceled.
13. Notices. Any notices under this Agreement required
to be given shall be effective only if given or confirmed in
writing, shall be deemed given by the party providing notice
when received by the party to whom notice is being given,
and shall be sent certified mail, postage prepaid, or hand
delivered, to the following address, or to such other
address as a party may specify by written notice to each of
the other parties hereto:
If to Prudential Securities: If to the Trustee:
Prudential Securities Incorporated Wilmington Trust Company
One New York Plaza, 13th floor Xxxxxx Xxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000 0000 Xxxxx Xxxxxx Xxxxxx
Attention: Xxxxxxx X. Xxxxxx, Esq. Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust
Administration
If to the Trust: If to the Managing Owner:
World Monitor Trust Serie s B Prudential Securities Futures
c/o Prudential Securities Futures Management Inc.
Management Inc. Xxx Xxx Xxxx Xxxxx, 00xx Xx.
One Xxx Xxxx Xxxxx, 00xx xxxxx Xxx Xxxx, Xxx Xxxx 00000
Xxx Xxxx, Xxx Xxxx 00000
in either case with a copy to:
Xxxx X. Xxxxx, Esq. and Xxxxxxx X. Xxxxxx, Esq.
Rosenman & Colin LLP Prudential Securities Inc.
000 Xxxxxxx Xxxxxx Xxx Xxx Xxxx Plaza, 13th Fl.
Xxx Xxxx, Xxx Xxxx 00000 Xxx Xxxx, Xxx Xxxx 00000
If to the Advisor: with a copy to:
Eclipse Capital Management, Inc. Sidley & Austin
00000 Xxxxx Xxxxxxxxx, Xxx. 000 One First Xxxxxxxx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000 Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx Attention: Xxxxx Xxxxxx, Esq.
Facsimile: (000) 000-0000 Facsimile: (000) 000-0000
35
14. Governing Law. This Agreement shall be deemed to
be made under the laws of the State of New York applicable
to contracts made and to be performed in that State and
shall be governed by and construed in accordance with the
laws of that State, without regard to the conflict of laws
principles.
15. Arbitration, Remedies. Each party hereto agrees
that any dispute relating to the subject matter of this
Agreement shall be settled and determined by arbitration in
the City of New York pursuant to the rules of NFA or, if NFA
should refuse to accept the matter, the American Arbitration
Association.
16. Assignment. This Agreement may not be assigned by
any party without the express prior written consent of each
of the other parties hereto.
17. Amendment or Modification or Waiver. This
Agreement may not be amended or modified except by the
written consent of each of the parties hereto.
18. Successors. Except as set forth in Section 10,
this Agreement is made solely for the benefit of and shall
be binding upon the Trust, the Managing Owner, Prudential
Securities and the Advisor, and the respective successors
and permitted assigns of each of them, and no other person
shall have any right or obligation under this Agreement.
The terms "successors", and "assigns" shall not include any
purchasers, as such, of Interests.
19. Survival. The provisions of this Agreement shall
survive the termination of this Agreement with respect to
any matter arising while this Agreement was in effect.
36
20. No Waiver. No failure or delay on the part of any
party hereto in exercising any right, power or remedy
hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power or
remedy preclude any other or further exercise thereof or the
exercise of any other right, power or remedy. Any waiver
granted hereunder must be in writing and shall be valid only
in the specific instance in which given.
21. No Liability of Limited Owners. This Agreement has
been made and executed by and on behalf of the Trust and the
Managing Owner, and the obligations of the Trust and/or the
Managing Owner set forth herein are not binding upon any of
the Limited Owners individually, but rather, are binding
only upon the assets and property of the Trust, and, to the
extent provided herein, upon the assets and property of the
Managing Owner.
22. Headings. Headings to Sections herein are for the
convenience of the parties only, and are not intended to be
or to affect the meaning or interpretation of this
Agreement.
23. Complete Agreement. Except as otherwise provided
herein, this Agreement and the Advisory Agreement constitute
the entire agreement among the parties with respect to the
matters referred to herein, and no other agreement, verbal
or otherwise, shall be binding upon the parties hereto.
24. Counterparts. This Agreement may be executed in
one or more counterparts, all of which, when taken together,
shall be deemed to constitute one original instrument.
37
IN WITNESS WHEREOF, this Agreement has been executed as
of the day and year first above written.
PRUDENTIAL SECURITIES
WORLD MONITOR TRUST FUTURES MANAGEMENT INC.
By: PRUDENTIAL SECURITIES
FUTURES MANAGEMENT INC., By:-----------------------
Its: Managing Owner Xxxxxxx X. Xxxxxx
Vice-President
By:-------------------------- WILMINGTON TRUST COMPANY
Xxxxxxx X. Xxxxxx
Vice-President
By:-----------------------
ECLIPSE CAPITAL MANAGEMENT, INC.
By:--------------------------
Xxxxxx X. Xxxxxx
President
38
The undersigned Advisor has reviewed the Prospectus dated
______________________, 1998 of World Monitor Trust with
respect to the information contained therein relating to the
Advisor and, in accordance with paragraph 2 of the Advisory
Agreement among us dated as of the _____ day of
____________, 1998, and hereby consents to its distribution.
ECLIPSE CAPITAL MANAGEMENT, INC.
By:--------------------------
Xxxxxx X. Xxxxxx
President
39
