ADMINISTRATION AND ACCOUNTING SERVICES AGREEMENT
THIS ADMINISTRATION AND ACCOUNTING AGREEMENT is made and entered
into as of June 26, 2003, by and between X.X. Xxxxx & Co. (the "Administrator")
and Excelsior Absolute Return Fund of Funds, LLC ("Excelsior").
WITNESSETH:
WHEREAS, Excelsior is registered as a closed-end, non-diversified
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, Excelsior desires to retain the Administrator to provide
certain administrative and accounting services to Excelsior and the
Administrator desires to provide such services.
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, and intending to be legally bound hereby the parties
hereto agree as follows:
1. Definitions. As used in this Agreement:
(a) "1933 Act" means the Securities Act of 1933, as amended.
(b) "1934 Act" means the Securities Exchange Act of 1934, as
amended.
(c) "Authorized Person" means any person duly authorized by
Excelsior's Board of Managers to give Oral Instructions and Written Instructions
on behalf of Excelsior and listed on the Authorized Persons Appendix attached
hereto and made a part hereof or any amendment thereto as may be received by the
Administrator. An Authorized Person's scope of authority may be limited by
Excelsior by setting forth such limitation in the Authorized Persons Appendix.
(d) "CEA" means the Commodities Exchange Act, as amended.
(e) "Board of Managers" and "Members" shall have the same meanings
as set forth in Excelsior's limited liability company agreement.
(f) "GLB Act" means the Xxxxx-Xxxxx-Xxxxxx Act, as amended.
(g) "Oral Instructions" mean oral instructions received by the
Administrator from an Authorized Person or from a person reasonably believed by
the Administrator to be an Authorized Person.
(h) "SEC" means the Securities and Exchange Commission.
(i) "Securities Laws" means the 1933 Act, the 1934 Act, the 1940
Act and the CEA.
(j) "Written Instructions" mean written instructions signed by an
Authorized Person and received by the Administrator. The instructions may be
delivered by hand, mail, tested telegram, cable, telex or facsimile sending
device.
2. Appointment. Excelsior hereby appoints the Administrator to
provide administrative and accounting services, in accordance with the terms set
forth in this Agreement. The Administrator accepts such appointment and agrees
to furnish such services.
3. Compliance with Rules and Regulations. The Administrator
undertakes to comply with all applicable requirements of the Securities Laws,
and any laws, rules and regulations of governmental authorities having
jurisdiction with respect to the duties to be performed by the Administrator
hereunder. Except as specifically set forth herein, the Administrator assumes no
responsibility for such compliance by Excelsior.
4. Records; Visits.
(a) The books and records pertaining to Excelsior which are in
the possession or under the control of the Administrator shall be the property
of Excelsior. Such books and records shall be prepared and maintained as
required by the 1940 Act and other applicable securities laws, rules and
regulations. Excelsior and Authorized Persons shall have access to such books
and records at all times during the Administrator's normal business hours. Upon
the reasonable request of Excelsior, copies of any such books and records shall
be provided by the Administrator to Excelsior or to an Authorized Person, at
Excelsior's expense.
(b) The Administrator shall keep the following records:
(i) all books and records with respect to Excelsior's books of
account;
(ii) records of Excelsior's securities transactions; and
(iii) all other books and records as Excelsior is required to
maintain pursuant to Rule 31a-1 of the 1940 Act in connection with the services
provided by the Administrator hereunder.
5. Description of Services. The Administrator will perform the
following administration and accounting services:
(a) Establish, periodically review and update
Excelsior's accounting systems and internal controls;
(b) Evaluate accounting and recordkeeping procedures
and practices of investment managers being considered for investment by
Excelsior;
(c) Monitor accounting and recordkeeping procedures
and practices of investment managers retained by Excelsior;
(d) Consult with investment managers to obtain
accurate and timely performance evaluations on a monthly basis;
(e) Prepare monthly performance summary for
Excelsior;
(f) Prepare detailed quarterly reports for members of
Excelsior;
(g) Calculate on a monthly basis the interest of each
member of Excelsior;
(h) Provide Excelsior with an estimate of tax gains
and losses and other allocations with respect to each member of Excelsior, as of
December 15 of each year and at such other times that are practicable, as may be
requested by Excelsior;
(i) Consult with the auditors designated by Excelsior
to establish procedures for the annual audit of Excelsior and prepare such
reports and other information as may be requested by such auditors;
(j) Consult with attorneys retained by Excelsior to
ensure compliance with Excelsior's limited liability company agreement;
(k) Prepare and file Excelsior's Annual and
Semi-Annual Reports with the SEC on Form N-SAR, N-CSR and N-30 via XXXXX;
(l) Prepare for execution and file Excelsior's
Federal Form 1065 and state tax returns;
(m) Prepare annual Form K-1's and supplementary
schedules for Member in accordance with applicable tax regulations;
(n) Maintain the register of Members of Excelsior and
enter on such register all issues, transfers and repurchases of interests in
Excelsior;
(o) Arrange for the calculation of the issue and
repurchase prices of interests in Excelsior in accordance with Excelsior's
limited liability company agreement and confidential memorandum;
(p) Allocate income, expenses, gains and losses to
individual Members' capital accounts in accordance with applicable tax laws and
with Excelsior's limited liability company agreement; and
(q) Retain in a safe place Share Registers and
transfer forms for a period of at least six years from the time of execution.
6. Standard of Care. The Administrator shall be obligated to
exercise reasonable care and diligence in the performance of its duties
hereunder, to act in good faith and to use its best efforts in performing the
services provided for under this Agreement. The Administrator shall be liable
for any damages arising out of the Administrator's failure to perform its duties
under this Agreement to the extent such damages arise out of the Administrator's
willful misfeasance, bad faith, negligence or reckless disregard of such duties.
7. Compensation.
(a) Excelsior shall pay the Administrator, on a quarterly
basis, within ten days after the end of each calendar quarter, a fee in an
amount equal to the greater of (i) 2.5 basis points (10 basis points on an
annualized basis) of the net assets under management of Excelsior as of the
first day of such calendar quarter, or (ii) $3,000. Notwithstanding the
foregoing, the sum of all fees payable pursuant to this Section 7(a) with
respect to any fiscal year of Excelsior shall not exceed $150,000, subject to
the CPI adjustment in (b) below.
(b) For purposes of this Section 7, assets under
management as of the first day of any calendar quarter shall not include any
assets reserved for distribution to members or payment to the investment adviser
of Excelsior. In addition, the maximum quarterly administrative fee of $37,500
shall be adjusted on each January 1 of this Agreement based on the increase or
decrease in the "Revised Consumers Price Index - (1967= 100)" for the
immediately preceding calendar year, as published by the Bureau of Labor
Statistics of the United States Department of Labor.
8. Confidential Information. The Administrator will have access
to and become acquainted with records of and information relating to Excelsior,
its Members and affiliates (collectively, "Confidential Information"). Neither
the Administrator nor any of its officers, employees or agents shall disclose
any of the Confidential Information (including any client list or other
confidential information relating to the businesses of Excelsior or its
affiliates), directly or indirectly, or use them in any way, either during the
term of this Agreement or at any time thereafter, except as required in the
course of performing duties for Excelsior under this Agreement and unless the
disclosure of any such Confidential Information is otherwise consented to, in
writing, by Excelsior. As used in this Section 8 the term "Confidential
Information" does not include information that (a) becomes or has been generally
available to the public other than as a result of disclosure by the
Administrator; (b) was available to the Administrator on a non-confidential
basis prior to its disclosure by Excelsior or any of its affiliates; or (c) is
independently developed or becomes available to the Administrator on a
non-confidential basis from a source other than Excelsior or its affiliates.
Further, the Administrator will adhere to all applicable laws and
regulations relating to consumer privacy, including the GLB Act ("Privacy Law"),
and to the privacy
policies adopted by Excelsior pursuant to Title V of the GLB Act.
Notwithstanding the foregoing, the Administrator will not share any nonpublic
personal information concerning any of Excelsior's Members with any
non-affiliated party unless specifically directed by Excelsior or allowed under
one of the exceptions noted under Privacy Law. The Administrator shall (a) cause
its employees and agents to be informed of, and to agree to be bound by, Privacy
Law and the relevant provisions of this Agreement, and (b) maintain physical,
electronic and procedural safeguards reasonably designed to protect the
security, confidentiality and integrity of, and to prevent unauthorized access
to or use of, any nonpublic personal information concerning any of Excelsior's
Members.
9. Liaison with Accountants. The Administrator shall act as
liaison with Excelsior's independent public accountants and shall provide
account analyses, fiscal year summaries, and other audit-related schedules. The
Administrator shall take all reasonable action in the performance of its duties
under this Agreement to assure that the necessary information is made available
to such auditors and accountants in a timely fashion for the expression of their
opinion, as required by Excelsior.
10. Disaster Recovery. In the event of equipment failures, the
Administrator shall, at no additional expense to Excelsior, take reasonable
steps to minimize service interruptions. The Administrator shall have no
liability with respect to the loss of data or service interruptions caused by
equipment failure, provided such loss or interruption is not caused by the
Administrator's own willful misfeasance, bad faith, gross negligence or reckless
disregard of its duties or obligations under this Agreement.
11. Other Services. Other services rendered at the option or
request Excelsior that are not outlined in Section 5 above, shall be billed at
an hourly rate of $100.
12. Term. This Agreement shall continue until terminated by
Excelsior or the Administrator on sixty days' prior written notice to the other
party.
13. Notices. All notices and other communications, including
Written Instructions, shall be in writing or by confirming telegram, cable,
telex or facsimile sending device. If notice is sent by confirming telegram,
cable, telex or facsimile sending device, it shall be deemed to have been given
immediately. If notice is sent by first-class mail, it shall be deemed to have
been given three days after it has been mailed. If notice is sent by messenger,
it shall be deemed to have been given on the day it is delivered. Notices shall
be addressed (a) if to the Administrator, at X.X. Xxxxx & Co., One Praesideo
Place, Suite 200, 0000 Xxxx Xxxx Xxxxxx, Xxxxxxxx Xxxx, Xxxx 00000; (b) if to
Excelsior, at c/o NCT Opportunities, Inc., 000 Xxxx Xxxxx Xxxx, Xxxxxxxx, XX
00000, Attn: Xxxxxxx Xxxxxxxx; or (c) if to neither of the foregoing, at such
other address as shall have been provided by like notice to the sender of any
such notice or other communication by the other party.
14. Amendments. This Agreement, or any term thereof, may be
changed or waived only by written amendment, signed by the party against whom
enforcement of such change or waiver is sought.
15. Delegation; Assignment. This Agreement and the rights and
duties of the parties herein may not be assigned or delegated by any party
without the written consent of each party.
16. Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
17. Further Actions. Each party agrees to perform such further
acts and execute such further documents as are necessary to effectuate the
purposes hereof.
18. Miscellaneous.
(a) Entire Agreement. This Agreement embodies the entire
agreement and understanding between the parties and supersedes all prior
agreements and understandings relating to the subject matter hereof, provided
that the parties may embody in one or more separate documents their agreement,
if any, with respect to delegated duties and Oral Instructions.
(b) Captions. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect.
(c) Governing Law. This Agreement shall be deemed to be a
contract made in North Carolina and governed by North Carolina law, without
regard to principles of conflicts of law.
(d) Partial Invalidity. If any provision of this Agreement shall
be held or made invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby.
(e) Successors and Assigns. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
(f) Facsimile Signatures. The facsimile signature of any party to
this Agreement shall constitute the valid and binding execution hereof by such
party.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed as of the day and year first above written.
EXCELSIOR ABSOLUTE RETURN FUND OF FUNDS, LLC
By:
Title: Principal Manager
X.X. XXXXX & CO.
By:
Title: President
