Exhibit 10.6
INVESTMENT ADVISORY
SUPPORT SERVICES AGREEMENT
THIS INVESTMENT ADVISORY SUPPORT AGREEMENT (this "Agreement") is made
and entered into by and among MACC Private Equities Inc., a Delaware corporation
("MACC"), MorAmerica Capital Corporation, an Iowa corporation ("MorAmerica"),
Atlas Management Partners, LLC, a Utah limited liability company ("Atlas") and
InvestAmerica Investment Advisors, Inc., a Delaware corporation
("InvestAmerica") effective as of the 1st day of March, 2004 (the "Effective
Date").
RECITALS
WHEREAS, MACC and MorAmerica (collectively, the "Funds") are closed-end
management investment companies which have elected to be regulated as business
development companies under the Investment Company Act of 1940, as amended (the
"1940 Act") and MorAmerica is also licensed as a small business investment
company ("SBIC") under the Small Business Investment Act of 1958;
WHEREAS, the Funds are subject to the terms of certain exemptive orders
granted by the Securities and Exchange Commission ("SEC") which govern, among
other things, co-investments by the Funds and other investment funds managed by
any investment advisor to the Funds (the "Exemptive Orders");
WHEREAS, Atlas and InvestAmerica are both registered investment
advisors under the Investment Advisors Act of 1940, as amended (the "Advisors
Act");
WHEREAS, concurrently with the execution of this Agreement, Atlas is
becoming the investment advisor to ("MACC") and its wholly owned subsidiary
MorAmerica Capital Corporation, an Iowa corporation ("MorAmerica") pursuant to
an agreement between Atlas and each of MACC and MorAmerica (the "Atlas Advisory
Agreements");
WHEREAS, prior to the execution of this Agreement, InvestAmerica was
the investment advisor to MACC and MorAmerica with respect to Portfolio Company
(as defined in the Atlas Advisory Agreements) investments in existence as of the
date of this Agreement (the "Existing Portfolio");
WHEREAS, effective on the date hereof, the investment advisory
agreements previously governing the Existing Portfolio are terminated;
WHEREAS, Atlas desires to obtain the support and assistance of
InvestAmerica in carrying out Atlas' duties and obligations as the investment
advisor to MACC and MorAmerica, and InvestAmerica desires to provide such
support and assistance as sub-advisor on the terms and conditions set forth
herein; and
WHEREAS, this Agreement has been approved in accordance with the
provisions of the 1940 Act.
NOW, THEREFORE, in consideration of the mutual agreements and covenants
set forth in this Agreement, the parties agree as follows:
1. Services. InvestAmerica will provide those financial, business and
investment advisory services specified on Schedule A (collectively referred to
as the "Services") to, or for the benefit of, MACC and MorAmerica, subject to
the oversight and supervision of Atlas and the direction and control of the
Boards of Directors of MACC and MorAmerica.
2. Term. This Agreement shall continue in effect for two (2) years from
the date hereof, unless sooner terminated as provided for herein. Thereafter,
this Agreement shall continue in effect so long as such continuance is
specifically approved at least annually by Atlas and the Funds' Boards of
Directors, including a majority of its members who are not interested persons of
InvestAmerica, or by vote of the holders of a majority, as defined in the 1940
Act, of the Funds' outstanding voting securities. The foregoing notwithstanding,
this Agreement may be terminated by Atlas, MACC or MorAmerica at any time,
without payment of any penalty, on sixty (60) days' written notice to
InvestAmerica if the decision to terminate has been made by Atlas or by the
Funds' Boards of Directors or by vote of the holders of a majority, as defined
in the 1940 Act, of MACC's or MorAmerica's outstanding voting securities. This
Agreement also may be terminated by InvestAmerica at any time, without payment
of any penalty, on sixty (60) days' written notice to Atlas and the Funds.
3. Portfolio Board Service and Asset Management.
3.1 It is acknowledged that as a part of the Services to be
provided by InvestAmerica hereunder, (i) certain of its employees,
representatives and agents ("InvestAmerica Representatives") may serve
as members of the board of directors of individual Portfolio Companies
(as defined in the respective Investment Advisory Services Agreements
between Atlas and MACC and MorAmerica) and (ii) InvestAmerica will
monitor and manage investments in the Existing Portfolio, including
exits, preparation of valuations and other portfolio management
matters. InvestAmerica and InvestAmerica Representatives serving on the
boards of directors of individual Portfolio Companies shall conduct the
Services in accordance with applicable law and all investment policies
as set forth in writing by Atlas and the Board of Directors with
respect to such Services, provided that at all times the InvestAmerica
Representatives shall act in accordance with their fiduciary duties as
members of the Portfolio Company boards. In regard to such actions and
decisions the Funds hereby appoint InvestAmerica (and such officers,
directors, employees, representatives and agents is it shall designate)
as its proxy, as a result of which InvestAmerica shall have the
authority, in its performance of this Agreement, to make decisions and
to take such actions, without specific authority from Atlas or the
Boards of Directors of the Funds, as to all matters which are not
hereby restricted.
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3.2 All fees, including director's fees that may be paid to
InvestAmerica by or for the account of a Portfolio Company shall be
paid to the Funds. Notwithstanding the foregoing, InvestAmerica will be
allowed to be reimbursed by Portfolio Companies for all direct expenses
associated with due diligence and management of portfolio investments
or investment opportunities, including expenses of attending board and
management meetings, and such expenses (travel, meals, lodging, etc.)
will not be payable to, or by, Atlas or credited against the Management
Fee.
3.3 Except for expense reimbursement provided in Section 3.2
above and 3.4 below, InvestAmerica's sole and exclusive compensation
for all of its services to be rendered hereunder will be in the form of
a Management Fee and a separate Incentive Fee as provided in Section 4.
3.4 InvestAmerica will be responsible for the following
expenses: its staff salaries and fringes, office space, office
equipment and furniture, communications, travel, meals and
entertainment, conventions, seminars, office supplies, dues and
subscriptions, hiring fees, moving expenses, repair and maintenance,
employment taxes, in-house accounting expenses and minor miscellaneous
expenses. InvestAmerica will pay for its own account all expenses
incurred in rendering the services to be rendered hereunder. Without
limiting the generality of the foregoing, InvestAmerica will pay the
salaries and other employee benefits of the persons in its organization
whom it may engage to render such services, including without
limitation, persons in its organization who may from time to time agree
to act as officers of the Funds. Atlas or the Funds, however, will be
responsible for all reasonable expenses for travel at the direction of
Atlas or the Funds, including for Board or other management meetings,
which expenses shall be reimbursed promptly upon being invoiced
therefor by InvestAmerica. Without limiting the foregoing,
InvestAmerica will not be responsible for any expenses: (i) required to
be paid by the Funds pursuant to the Atlas Advisory Agreements
(including, without limitation, Section 2.3 of each Atlas Advisory
Agreement), (ii) any expenses related to moving management of the Funds
to Atlas, including expenses of moving records to Salt Lake, (iii)
expenses of duplicating files necessary for performance of the
Services; or (iv) any other expenses incurred in connection with the
services that are not expressly payable by InvestAmerica under this
Agreement.
3.5 The obligations of InvestAmerica to Atlas and the Funds
are not exclusive.
(a) InvestAmerica and its affiliates may, in their
discretion, manage other venture capital funds and render the
same or similar services to any other person or persons who
may be making the same or similar investments. Neither
InvestAmerica nor any of its affiliates shall in any manner be
liable to Atlas, the Funds or their affiliates by reason of
the activities of InvestAmerica or its affiliates on behalf of
other persons and funds as described in this paragraph and any
conflict of interest arising therefrom is hereby expressly
waived.
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(b) The scope of the Services does not include
presentation of investment opportunities to the Funds or
making new investments for the Funds, but rather is limited to
management of the Existing Portfolio. Accordingly,
InvestAmerica is not required to present to the Funds
investments being considered by other funds managed by
InvestAmerica or its affiliates.
(c) With respect to follow-on investments made by
InvestAmerica pursuant to this Agreement, any such investment
management services and all co-investments shall at all times
be provided in strict accordance with rules and regulations
under the 1940 Act, the Exemptive Orders and the rules and
regulations applicable to SBICs.
4. Management and Incentive Fees.
4.1 During the term of this Agreement, and to the extent the
Agreement is extended pursuant to the terms of this Agreement and the
terms of the 1940 Act, Atlas will pay InvestAmerica a Management Fee in
the following amounts:
Period Management Fee
Effective Date through February 28, 2005 $ 325,000
March 1, 2005 through February 28, 2006 250,000
March 1, 2006 through February 28, 2007 125,000
March 1, 2007 through February 28, 2008 60,000
March 1, 2008 through February 28, 2009 60,000
The Management Fee shall be paid to InvestAmerica in equal monthly
installments within fifteen (15) days after the end of each calendar
month for Services provided during the previous month, provided that
Atlas has received payment of its management fee from MACC and
MorAmerica pursuant to the terms of its agreements with MACC and
MorAmerica. Payments of Management Fees that are delayed because of
failure of MACC or MorAmerica to pay a management fee to Atlas for the
corresponding period shall be made promptly upon Atlas receiving such
management fee from MACC or MorAmerica. The Management Fee shall stop
accruing on the date that this Agreement expires or is terminated. Upon
expiration or termination of this Agreement, all earned but unpaid
Management Fees shall be immediately due and payable.
4.2 During the term of this Agreement Atlas shall pay to
InvestAmerica an Incentive Fee determined as follows:
(a) The Incentive Fee to be paid to InvestAmerica
from the Effective Date through February 28, 2008 shall
consist of seventy percent (70%) of the incentive fee actually
paid by MACC and MorAmerica to Atlas pursuant to the
respective Investment Advisory Agreements between Atlas and
MACC and MorAmerica attributable to Existing Portfolio
Companies as of the Effective Date. The remaining thirty (30%)
percent of the incentive fee actually paid by MACC and
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MorAmerica attributable to Existing Portfolio Companies as of
the Effective Date shall belong to Atlas.
(b) The Incentive Fee to be paid to InvestAmerica
from the March 1, 2008 through February 28, 2009 shall consist
of fifty percent (50%) of the incentive fee actually paid by
MACC and MorAmerica to Atlas pursuant to the respective
Investment Advisory Agreements between Atlas and MACC and
MorAmerica attributable to Existing Portfolio Companies as of
the Effective Date. The remaining fifty (50%) percent of the
incentive fee actually paid by MACC and MorAmerica
attributable to Existing Portfolio Companies as of the
Effective Date shall belong to Atlas. All incentive fees paid
by MACC and MorAmerica to Atlas attributable to companies that
were not Portfolio Companies as of the Effective Date shall
belong solely to Atlas.
(c) All incentive fees paid by MACC and MorAmerica to
Atlas attributable to companies that were not Existing
Portfolio companies as of the Effective Date shall belong
solely to Atlas.
(d) The Incentive Fee shall stop accruing effective
as of the date of the expiration or termination of this
Agreement. Upon expiration or termination of this Agreement,
all earned but unpaid incentive fees shall be immediately due
and payable; provided, however, that incentive fees earned
with respect to non-cash Realized Capital Gains shall not be
due and owing to InvestAmerica until the cash is received by
the Funds.
(e) To the extent payable, Atlas shall arrange for
the Incentive Fee to be paid to InvestAmerica directly by the
Funds, on the same date as Atlas is paid its share of the
Incentive Fee by the Funds, and in no event less than
annually.
5. Personnel. All employee wages, benefits and other related costs for
employees and personnel of InvestAmerica shall be the sole responsibility of
InvestAmerica, and InvestAmerica shall have sole control of the payment of wages
and benefits to such employees. The individuals providing the Services shall at
all times be considered to be in the employ of InvestAmerica and under the
direction and control of InvestAmerica, and they shall not be considered to be
in the employ of Atlas. No InvestAmerica personnel shall be required to relocate
to Salt Lake City. Without the prior written consent of InvestAmerica (which
consent InvestAmerica may grant or withhold in its sole and absolute
discretion), Atlas agrees that it shall not, for a period of three (3) years
from the date of termination of this Agreement, either alone or in conjunction
with any other person, or directly or indirectly through its present or future
affiliates, employ, engage or seek to employ or engage any person who is an
employee of InvestAmerica.
6. Accounts and Records. InvestAmerica will maintain books of account
and other records and files with respect to the Services provided hereunder.
InvestAmerica shall make
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such records available for inspection by Atlas upon reasonable notice at
mutually convenient times at the place where such records are kept in the
ordinary course of business.
7. Confidentiality. InvestAmerica agrees that it will come into
possession of information regarding the Portfolio Companies and information
regarding other companies, the securities of which are owned by other funds
managed by one of the parties ("Confidential Portfolio Information"), and
information concerning the business of the other parties to this Agreement
("Confidential Business Information") (collectively the Confidential Portfolio
Information and Confidential Business Information are referred to herein as
"Confidential Information"). Confidential Information shall not include
information independently developed by a party without reliance on the
Confidential Information of the other party, information obtained from a third
party, which third party is under no restriction with respect to the use and
disclosure of such information, or information approved for unrestricted release
by a party without violating a provision of this agreement.
InvestAmerica agrees that the Confidential Information is highly
confidential, private and of a sensitive nature. Atlas and InvestAmerica agree
that each will handle the Confidential Information of the other with the same
degree of care that it uses to handle its own Confidential Information, and
will, at all times, handle the Confidential Information of the other in a manner
reasonably calculated to maintain its confidentiality. Each party understands
that the other may disclose Confidential Information as reasonably necessary:
(i) in the normal course of managing existing portfolios, (ii) in performing the
Services, (iii) in the performance of tasks by InvestAmerica as requested by
Atlas, (iv) in communicating with shareholders, investors, and regulatory
agencies, including the SBA and SEC. Atlas and InvestAmerica also agree that the
parties may disclose Confidential Portfolio Information to banks, financing
sources, investment banks, brokers, auditors, law firms and other service
providers (i) as reasonably necessary in connection with the management of an
investment in a Portfolio Company, (ii) at the request of the Portfolio Company
who directs disclosure to third parties, (iii) as reasonably necessary in
connection with service as a director of a Portfolio Company. InvestAmerica may
also use and disclose information regarding IRR, cash flow and other performance
data for the Existing Portfolio and all other historical performance data
relating to the Existing Portfolio and prior investments during the time
InvestAmerica managed the Funds. In addition, a party may use and disclose the
Confidential Information of the other party where required by law, provided that
it shall first notify the other party in writing of such requirement and
cooperate with respect to any reasonable steps available for the further
protection of such Confidential Information.
InvestAmerica agrees that it will use the Confidential Information
solely in the management of the Funds or the management of other funds that have
co-investments with the Funds.
InvestAmerica agrees that, in the event of any breach of any provision
hereof, the aggrieved party will not have an adequate remedy in money or damages
and that, in such event, the aggrieved party shall be entitled to obtain
injunctive relief against such breach in any court of competent jurisdiction,
without the necessity of posting a bond even if otherwise normally
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required. Such injunctive relief will in no way limit the aggrieved party's
right to obtain other remedies available under applicable law.
8. Compliance with Laws; Cooperation.
8.1 InvestAmerica shall use diligent effort to cause all
Services to be performed in strict compliance with all laws,
regulations and requirements of any federal, state, municipal or other
governmental entity having jurisdiction respecting either of the
parties and/or the Services being rendered, including the 1940 Act, the
Advisors Act and all Exemptive Orders.
8.2 Atlas shall cooperate fully with InvestAmerica's efforts
to perform the Services effectively and in compliance with applicable
law, including providing InvestAmerica with files and records necessary
for the performance of the Services.
9. Indemnification; Fidelity Bond, Directors and Officers Insurance.
9.1 Atlas shall not be liable or responsible for any action or
omission on the part of InvestAmerica or its employees, representatives
or agents arising out of their respective service on the board of
directors of individual Portfolio Companies or provision of other
Services pursuant to this Agreement, except to the extent that such
action or omission was specifically directed by Atlas, in writing.
InvestAmerica shall indemnify and hold Atlas harmless from any claims
or liabilities arising out of the service of InvestAmerica and its
employees, representatives and agents on the boards of directors of
individual Portfolio Companies or the provision of other Services
pursuant to this Agreement, except to the extent that InvestAmerica or
its employees, representatives or agents were carrying out the express
written or oral instructions of Atlas in connection with the action or
omission complained of.
9.2 InvestAmerica shall not be liable or responsible for any
action or omission on the part of Atlas or its employees,
representatives or agents arising out of this Agreement or the Atlas
Advisory Agreements. Atlas shall indemnify and hold InvestAmerica
harmless from any claims or liabilities arising out of Atlas' actions
or omissions with respect to this Agreement or the Atlas Advisory
Agreements.
9.3 During the term of this Agreement, InvestAmerica and its
officers, directors and employees, with respect to performance of the
Services under this Agreement and as officers or employees of the
Funds, if applicable, shall be covered at all times by a (i) directors
and officers insurance policy and (ii) a joint fidelity bond, in each
case at least as extensive in amount, scope and coverage as required by
law and as presently in force (as long as reasonable commercially
available), and at no cost to InvestAmerica.
9.4 Neither InvestAmerica, nor any of its officers, directors,
shareholders, employees, agents or Affiliates, whether past, present or
future (collectively, the
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"Indemnified Parties"), shall be liable to Atlas or the Funds, or any
of their affiliates for any error in judgment or mistake of law made by
the Indemnified Parties in connection with any investment made by or
for the Funds, provided such error or mistake was made in good faith
and was not made in bad faith or as a result of gross negligence or
willful misconduct of the Indemnified Parties. The Funds confirm that
in performing services hereunder Atlas will be an agent of the Funds
for the purpose of the indemnification provisions of the Bylaws of the
Funds subject, however, to the same limitations as though the
Indemnified Parties were a director or officer of the Company.
InvestAmerica shall not be liable to Atlas, the Funds, their
shareholders or their creditors, except for violations of law or for
conduct which would preclude the Indemnified Parties from being
indemnified under such Bylaw provisions. The indemnification provisions
of this Section 9 are applicable to the entire period for which
InvestAmerica has provided advisory services to the Funds, beginning in
1985. The provisions of this Section 9(d) shall survive termination of
this Agreement.
10. Notices. All notices or other communications given pursuant to this
Agreement shall be in writing and shall be given by personal delivery, by United
States mail or an established, commercial express delivery service (such as
Federal Express), postage or delivery charge prepaid, return receipt requested,
addressed to the person and address designated below:
InvestAmerica: Invest America Investment Advisors, Inc.
000 Xxxxxx Xxxxxx X.X., Xxxxx 000
Xxxxx Xxxxxx XX 00000
Fax (000) 000-0000
Attn: Xxxxx X. Xxxxxxxx, President
Atlas: Atlas Management Partners, LLC
Xxx Xxxxx Xxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxx Xxxx, Xxxx 00000
Fax: (000) 000-0000
Attn: Xxxx X. Xxxxxx, Manager
A notice or other communication shall be deemed received on the
earliest of the following: (i) the date of its delivery to the address specified
above, (ii) the date of its actual receipt by the person or entity specified
above, or (iii) in the case of refusal to accept or inability to deliver the
notice or other communication, the earliest of (a) the date of the attempted
delivery or refusal to accept delivery, (b) the date of the postmark on the
return receipt, or (c) the date of receipt of notice of refusal or notice of
non-delivery by the sending party.
Either party may designate any other address in substitution of the
foregoing address(es) at any time by giving the other party ten (10) days
written notice, as provided herein, of the new address.
11. Severability. If any term, covenant or condition of this Agreement
or the application thereof to any person or circumstance shall be invalid or
unenforceable, the
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remainder of this Agreement or such other documents, or the application of such
term, covenant or condition to persons or circumstances other than those as to
which it is held invalid or unenforceable, shall not be affected thereby, and
each term, covenant or condition of this Agreement or such other documents shall
be valid and shall be enforced.
12. No Joint Venture, Partnership or Alter Ego; Independent Contractor.
Nothing contained in this Agreement, any document executed in connection
herewith or any other agreement with any other party shall be construed as
making InvestAmerica and Atlas partners, joint venturers or alter egos of each
other or of any other entity. InvestAmerica shall at all times remain an
independent contractor of Atlas with respect to the Services.
13. Additional Documents. The parties hereby agree to execute and
deliver such other documents and instruments as may be necessary or desirable to
give effect to the terms and intent of this Agreement.
14. Waiver. The failure of any party to insist upon strict performance
of any of the provisions contained herein shall not be deemed a waiver of any
rights or remedies that such party may have, and shall not be deemed a waiver of
any subsequent breach or default.
15. Captions and Headings. The captions and headings in this Agreement
are for ease of reference only and shall not be deemed to define or limit the
scope or intent of any of the terms, covenants, conditions or agreements
contained herein.
16. Entire Agreement. This Agreement contains the entire agreement
between and among the parties hereto and supersedes all prior negotiations and
agreements, oral or written, with respect to the subject matter hereof or with
respect to any of the Services.
17. Arm's-Length Agreement; Construction. The parties mutually
acknowledge that the provisions of this Agreement are the product of
arm's-length negotiations with parties having essentially equal bargaining
strength, legal representation and opportunity to determine the language used
herein. Therefore, the provisions of this Agreement shall not be construed for
or against any party.
18. No Third-Party Beneficiary Rights. This Agreement is not intended
to create, nor shall it be in any way construed to create any third-party
beneficiary rights in any person not a party hereto.
19. Successors and Assigns. This Agreement shall inure to the benefit
of and bind the respective parties' successors and assigns.
20. Applicable Law. This Agreement is made and delivered in, and shall
be construed and interpreted in accordance with the laws (without reference to
the choice-of-law provisions) of, the State of Delaware.
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21. Amendment. This Agreement may be amended only in writing executed
by all parties.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
ATLAS:
ATLAS MANAGEMENT PARTNERS, LLC
A Utah limited liability company
By: /s/ Xxxx X. Xxxxxx
-------------------------------------
Xxxx X. Xxxxxx
Manager
INVESTAMERICA:
INVESTAMERICA INVESTMENT ADVISORS, INC.
A Delaware corporation
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------
Xxxxx X. Xxxxxxxx
President
By: /s/ Xxxxxx X. Xxxxx
------------------------------------
Xxxxxx X. Xxxxx
Executive Vice President
MORAMERICA:
MORAMERICA CAPITAL CORPORATION
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------
Xxxxx X. Xxxxxxxx
President
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------
Xxxxxx X. Xxxxx
Executive Vice President
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MACC:
MACC PRIVATE EQUITIES, INC.
A Delaware corporation
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------------
Xxxxx X. Xxxxxxxx
President
By: /s/ Xxxxxx X. Xxxxx
------------------------------------
Xxxxxx X. Xxxxx
Executive Vice President
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Schedule A
SERVICES
To Be Provided by InvestAmerica
I.PORTFOLIO MANAGEMENT OF PORTFOLIO EXISTING AT 3/01/04
1. Gather, review, file, summarize monthly financials relating to
portfolio investments existing at 3/01/04 (the "Existing
Portfolio").
2. Report sales, pre tax, EBITDA actual vs. budget monthly.
3. Attend Existing Portfolio company board meetings.
4. Review and file projections.
5. Review and file annual audits.
6. Review covenant compliance.
7. Explore ways to add value i.e. explore growth and acquisition
opportunities and plans, assess management and new management
candidates.
8. Work to execute exit projections.
9. Communicate and work with co-investors to assess and add
value.
10. Analyze and recommend investment opportunities for the
Existing Portfolio company.
11. Support senior capital and venture capital acquisition as
required.
12. File all company monitoring information.
13. File all investment documentation.
14. Timely submission of all SBA documentation associated with the
Existing Portfolio.
15. In Existing Portfolio board roles, act in accord with proper
corporate governance guidelines, all in the interest of the
Existing Portfolio company and its shareholders.
16. Make available and, if requested by Existing Portfolio
companies, render managerial assistance to, and exercise
management rights in, Existing Portfolio companies and
entities as appropriate to maximize return for the Funds and
to comply with applicable regulations.
II. SBA EXAMINATIONS - FOR EXISTING PORTFOLIO
1. Prepare regulatory and financial schedules required by SBA for
two years.
2. Support the examination in Cedar Rapids for year one and send
info to Salt Lake City in subsequent years.
3. Examination preparation involves only the Existing Portfolio
and financial records.
4. Atlas responsible for examination preparation and management
of all new portfolio companies.
5. Atlas responsible as investment advisor of Funds;
InvestAmerica provides assistance on any inquiries related to
Existing Portfolio.
III. SEC EXAMINATIONS; SECURITIES CUSTODY
1. Atlas responsible as investment advisor of the Funds;
InvestAmerica provides assistance on any inquiries related to
Existing Portfolio.
2. Atlas responsible for custody of all assets (cash, securities,
et al) which are subject to SEC custody rules under the 1940
Act and the Advisors Act
IV. ACCOUNTING FOR MACC AND PEI
1. Prepare monthly and annual financial statements, Forms 468 and
quarterly reports for MACC for two years.
2. Atlas will be responsible for controls, check writing, wire
instructions and approval of expenses.
3. Will prepare PEI statements (i.e. monthly, quarterly and
annual statements) for one year.
4. Prepare quarterly and annual valuations reports provide
valuation analysis and support to MACC and PEI board of
directors and SBIC requirements.
V. SHAREHOLDER RELATIONS / ANNUAL REPORT
1. Atlas responsible for all shareholder relations.
2. Atlas will prepare the annual report, with financial input
from InvestAmerica for as long as InvestAmerica does the
accounting for MACC and PEI.
EXISTING PORTFOLIO FOLLOW-ON INVESTMENTS
1. InvestAmerica responsible for analysis, presentation,
proposal, gathering, filing investment documentation.
2. Atlas responsible for investment decision.
3. MACC Board responsible for the co-investment split decision.
BOARD MEETINGS
1. Atlas responsible.
2. InvestAmerica Investment Advisors, Inc. will provide
quarterly;
o Financials (P&L, Balance Sheet, Cash Flow Actual vs.
Budget)
o Management Letter on "Existing Portfolio"
o Portfolio Performance Report
o Valuations
o Audit preparation and work papers
InvestAmerica Investment Advisors, Inc. is not responsible for out of pocket
expenses (travel, meals, etc.) for performance of the CFO function or specific
requests to travel to Salt Lake City under the management/investment advisor
contract.
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FINANCIAL PROJECTIONS
1. InvestAmerica responsible for inputs with regard to the Existing
Portfolio and expenses under its control
2. Atlas responsible for PEI and MACC financial projections.
