Exhibit (2)(k)(1)
X.X. XXXXXX ATLAS GLOBAL LONG/SHORT EQUITY FUND, L.L.C.
J.P. XXXXXX ALTERNATIVE ASSET MANAGEMENT, INC.
-AND-
PFPC INC.
ADMINISTRATION AGREEMENT
THIS AGREEMENT is effective as of the 18th day of September, 2003.
BETWEEN:
X.X. XXXXXX ATLAS GLOBAL LONG/SHORT EQUITY FUND, L.L.C., a Delaware limited
liability company (hereinafter called the "Fund"),
X.X. XXXXXX ALTERNATIVE ASSET MANAGEMENT, INC., a Delaware corporation
(hereinafter called the "Investment Manager"),
AND
PFPC INC., a Massachusetts corporation (hereinafter called the
"Administrator").
WHEREAS:
(A) The Fund is organized as a limited liability company under the laws of
Delaware and is registered as a closed-end management investment company
under the Investment Company Act of 1940, as amended.
(B) The Fund wishes to appoint the Administrator as administrator of the Fund
to perform such administrative duties as are hereinafter set out.
(C) The Investment Manager has been appointed as the investment manager of the
Fund.
NOW IT IS HEREBY AGREED AS FOLLOWS:-
Definitions
1. (a) In this Agreement and in all amendments hereto, the following
words and expressions shall, where not inconsistent with the
context, have the following meanings respectively:
"Auditor" shall mean PricewaterhouseCoopers LLP acting as the
independent certified public accountants of the Fund or any other
entity for the time being appointed as independent certified public
accountants of the Fund.
"Authorized Person" shall mean the Investment Manager, any officer
of the Fund and any other person authorized by the Fund or the
Investment Manager to give Oral or
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Written Instructions on behalf of the Fund. An Authorized Person's
scope of authority may be limited by setting forth such limitation
in a written document signed by both parties hereto.
"Custodian" shall mean PFPC Trust Company, in its capacity as
custodian of the Fund's assets.
"Escrow Agent" shall mean PFPC Inc., in its capacity as escrow
agent for the Fund.
"Interests" shall mean all limited liability company interests in
the Fund.
"Investment Manager" shall mean X.X. Xxxxxx Alternative Asset
Management, Inc., the investment manager of the Fund.
"LLC Agreement" shall mean the Amended and Restated Limited
Liability Company Agreement of X.X. Xxxxxx Atlas Global
Long/Short Equity Fund, L.L.C., dated as of September 18, 2003.
"Managing Member" shall mean Xxxxxxx Associates, L.L.C. or any
successor managing member admitted to the Fund in accordance with
the LLC Agreement.
"Members" shall mean all persons admitted as members of the Fund in
accordance with the LLC Agreement.
"Oral Instructions" mean oral instructions received by the
Administrator from an Authorized Person.
"Written Instructions" mean (i) written instructions sent by an
Authorized Person and received by the Administrator, the Custodian
or the Escrow Agent, or (ii) trade instructions transmitted by means
of an electronic transaction reporting system access to which
requires use of a password or other authorized identifier. Written
Instructions under (i) above may be delivered by any method
described in Section 11 below.
"Portfolio Managers" shall mean portfolio managers in which the Fund
invests through the medium of investment funds or through
discretionary managed accounts.
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"Private Placement Memorandum" shall mean the Private Placement
Memorandum published by the Fund as the same may be amended from
time to time.
(b) Unless the context otherwise requires, words importing the singular
number shall include the plural and vice versa, words importing the
masculine gender shall include the feminine and words importing
persons shall include firms and companies and vice versa.
(c) The division of this Agreement into sections, clauses and
sub-clauses and the insertion of headings are for convenience of
reference only and shall not affect the construction or
interpretation thereof.
Appointment
2. The Fund hereby appoints the Administrator to act as administrator in
respect of the Fund, subject to the terms and conditions set forth in this
Agreement. The Administrator accepts such appointment and agrees to render
the services herein described for the remuneration herein provided.
Duties of the Administrator
3. (a) The Administrator shall administer the Fund in accordance with
the LLC Agreement and the Private Placement Memorandum and shall
perform such administrative duties as are set out in Appendix A and
Appendix C to this Agreement and such other services as may be
agreed in writing from time to time among the parties to this
Agreement.
(b) The Administrator shall for the purposes of this Agreement be deemed
to be an independent contractor and shall, unless otherwise
expressly provided or authorized, have no authority to act on behalf
of or to represent the Fund or the Managing Member in any way or
otherwise be deemed an agent of the Fund or the Managing Member or
to have any power to enter into any transaction or otherwise bind
the Fund or the Managing Member.
(c) The Administrator shall observe and comply with the LLC Agreement
and with the applicable provisions of the Private Placement
Memorandum of the Fund.
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(d) The Administrator will perform such additional procedures with
respect to compliance as are mutually agreed upon in writing by the
Administrator, the Managing Member and the Investment Manager or
otherwise specified in this Agreement (including Appendix A and
Appendix C hereto).
(e) (i) The Administrator, PFPC Inc., is in the process of
performing a review pursuant to Statement on Auditing
Standards 70, Part II ("SAS 70") for the segment of its
business that employs the Administrator's IAS platform,
and will make available to the Fund for inspection a
report of such review promptly following its completion.
For the segment of the Administrator's business that uses
the Investier platform, the Administrator will complete
its own SAS 70 after Sungard issues its SAS 70 on the
Investier platform.
(ii) Every year the Administrator shall conduct a review pursuant
to SAS 70 and will make available to the Fund for inspection a
report of such review and any updates thereto.
(iii) The Administrator shall immediately notify the Fund of any
changes in how it conducts its business that would materially
change the results of its most recent SAS 70 review and any
other changes to the Administrator's business that would
affect the Fund or the Investment Manager's business.
Instructions
4. (a) Unless otherwise provided in this Agreement, the Administrator
shall act only upon Oral Instructions or Written Instructions and
any other relevant information in the possession of the Custodian
or the Escrow Agent (and, for purposes of this Agreement, the
Administrator shall be deemed to be in receipt of any and all
instructions, notices and other information provided from time to
time by the Investment Manager or the Fund to the Custodian or
the Escrow Agent).
(b) The Administrator shall be entitled to rely upon any Oral
Instruction or Written Instruction it receives from an Authorized
Person in accordance with this Agreement. The Administrator may
assume that any Oral Instructions or Written Instructions
received hereunder are not in any way inconsistent with the
provisions of the LLC Agreement or of any vote, resolution or
proceeding of the Fund's Board of Directors
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or of the Fund's members, unless and until the Administrator
receives Written Instructions to the contrary.
(c) The Fund agrees to forward to the Administrator Written
Instructions confirming Oral Instructions (except where such Oral
Instructions are given by the Administrator or its affiliates) so
that the Administrator receives the Written Instructions by the
close of business on the business day following the day that such
Oral Instructions are received. The fact that such confirming
Written Instructions are not received by the Administrator or
differ from the Oral Instructions shall in no way invalidate the
transactions or enforceability of the transactions authorized by
the Oral Instructions or the Administrator's ability to rely upon
such Oral Instructions pending receipt of Written Instructions;
provided that the Administrator shall immediately notify the Fund
and the Investment Manager of any discrepancies between any Oral
Instructions and the Written Instructions which purport to
confirm those Oral Instructions, and indicate whether it acted in
accordance with the Oral Instructions or the later Written
Instructions.
(d) The Administrator shall promptly forward to the Custodian and Escrow
Agent, as applicable, any Oral Instructions or Written Instructions
received by the Administrator directed to or otherwise intended for
the Custodian or the Escrow Agent.
(e) The Administrator shall provide the Custodian and Escrow Agent, as
applicable, with appropriate oral and written instructions as
required to give effect to Oral Instructions and Written
Instructions received by the Administrator.
Standard of Performance
5. The Administrator shall be liable for any loss suffered by the Managing
Member, the Fund or its agents in the case of the Administrator's
negligence, willful default or willful misconduct, fraud, bad faith or
breach of any of its representations, duties and obligations under this
Agreement.
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Compensation
6. For the services provided and the expenses assumed pursuant to this
Agreement, the Fund shall pay to the Administrator as full compensation
therefor such sums as may be agreed to in writing by the Fund and the
Administrator. Additionally, the Administrator shall be reimbursed for
all out of pocket expenses that the Managing Member and the
Administrator have agreed in advance shall be borne by the Fund
("Extraordinary Expenses"), provided such expenses are appropriately
documented.
Amendments
7. This Agreement shall become effective upon the date hereinbefore written
and may be amended at any time by mutual agreement of the parties hereto
in writing.
Duration
8. (a) This Agreement will continue in full force and effect through
March 31, 2005 and shall be automatically renewed annually
thereafter on the same terms as specified herein. It may be
terminated at any time by any party to this Agreement without the
payment of any penalty, upon not less than ninety days' written
notice to the other parties, provided that:
(i) any party may at any time immediately terminate this
Agreement in the event of the appointment of an examiner,
liquidator or receiver to any other party hereto or upon
the happening of a like event at the direction of an
appropriate regulatory agency or court of competent
jurisdiction or upon any other party hereto being unable to
pay its debts as they fall due or otherwise becoming
insolvent or entering into any composition or arrangement
with or for the benefit of its creditors or any class
thereof;
(ii) the Fund or the Investment Manager may at any time immediately
terminate this Agreement in the event that the Administrator
is no longer permitted to perform its obligations hereunder
pursuant to applicable law;
(iii) any party may at any time immediately terminate this Agreement
in the event of any other party committing a material breach
of this Agreement which is either incapable of remedy (as
admitted in writing by the party committing
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the breach) or has not been remedied within thirty days of a
party serving notice on that party requiring it to remedy
same; and
(iv) the indemnity provisions of this Agreement and the provisions
determining the liability of the Administrator shall survive
the termination of this Agreement.
(b) Each party shall observe good faith towards the other parties and
shall inform the other parties immediately of the occurrence of any
of the events referred to in Section 8(a) above.
Upon Termination
9. Upon termination of this Agreement, in the event of the Fund or the
Managing Member entering into any agreement with another party for the
provision of administrative services to the Fund, the Administrator
shall cooperate in the orderly transfer of administrative duties to
such other party and shall return all originals of books and records
regarding the Fund to the Fund, or in accordance with the Fund's
directions. All costs related to the transfer of all original books
and records (and any other information or data), shall be borne by the
Fund provided such costs are agreed in advance with the Fund and
appropriately documented. The Administrator agrees that in the event
it gives notice that it is terminating the Agreement pursuant to
Section 8, it will continue to provide services to the Fund until such
time as a replacement administrator is in place and shall be
compensated during this period at the contractual rate.
Responsibility of the Administrator and Indemnity
10. (a) The Administrator shall not, in the absence of negligence,
willful default or willful misconduct, fraud, bad faith or breach
of this Agreement on the part of the Administrator or its
members, officers, employees, agents or delegates, be liable to
the Fund or to any Member for any act or omission in the course
of or in connection with the services rendered by it hereunder or
for any loss or damage which the Fund may sustain or suffer as
the result or in the course of the discharge by the Administrator
or its members, officers, employees, agents or delegates of its
duties hereunder or pursuant hereto.
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(b) The Fund agrees to indemnify the Administrator from and against any
and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses (including attorneys'
fees) or disbursements of any kind or nature whatsoever (other
than those resulting from the negligence, willful default or
willful misconduct, fraud, bad faith or breach of this Agreement
on the part of the Administrator or its members, officers,
employees, agents or delegates) which may be imposed on, incurred
by or asserted against the Administrator in performing its
obligations or duties hereunder. The Fund's liability under this
indemnity shall not exceed an amount equal to the sum of the net
worth of the Administrator plus the Applicable Insurance (as
defined herein) maintained by the Administrator as of the time
the claim giving rise to indemnity hereunder is alleged to have
arisen. "Applicable Insurance" means insurance underwritten by
an insurer in an arms' length transaction and in the ordinary
course of such insurer's business, which covers claims of the
type that the Fund or third parties could assert against the
Administrator related to this Agreement and the services provided
hereunder.
(c) The Administrator shall indemnify the Fund, the Managing Member and
the principals and officers of the Managing Member and hold them
harmless from and against all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs and expenses
(including reasonable attorney's fees or disbursements of any
kind or nature whatsoever (other than those resulting from
negligence, willful default, fraud or bad faith on the part of
the Fund, the Managing Member or its principals or officers))
incurred by the Fund, the Managing Member, the members and
officers of the Managing Member or their respective agents or
delegates arising directly or indirectly from negligence, willful
default or willful misconduct, fraud, bad faith or breach of this
Agreement on the part of the Administrator (or any of its
members, officers, employees, agents or delegates).
(d) (i) The Administrator, its members, officers or employees shall not
admit liability for, settle any claim or incur any costs or
expenses in connection therewith, without the written consent of
the Fund who shall be entitled, at its own expense and at any
time, to take over and conduct in the name of the Administrator,
its members, officers or employees, the defense or settlement of
any such claim on such reasonable terms as the Administrator may
require including, without prejudice to the generality of the
foregoing, terms as to indemnity. Without the prior written
consent of the Administrator, the Fund may not settle any claim
in which the Administrator is a
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party for an amount in excess of the Fund's indemnity obligation to
the Administrator pursuant to Section 9(b).
(ii) The Administrator, its members, officers or employees shall
give to the Fund notice in writing as soon as reasonably
possible:
(1) of the details of any claims, summonses or writs made
against any of them in relation to the affairs of the
Fund or of any circumstances of which any of them may
become aware which may give rise to a claim or loss in
relation to the affairs of the Fund for which indemnity
will be sought;
(2) of the receipt of written notice from any person of
an intention to make a claim against any of them; and
(3) of their intention to seek indemnity hereunder;
(iii) Once the notice required by paragraph (ii) above has been
given to the Fund, the Administrator shall give to the Fund as
soon as reasonably practicable details in writing of the
circumstances which may give rise to a claim for loss against
the Administrator, its members, officers or employees.
(e) Notwithstanding anything in this Agreement to the contrary, neither
the Administrator nor its affiliates shall be liable for any
consequential, special or indirect losses or damages, whether or not
the likelihood of such losses or damages was known by the
Administrator or its affiliates.
(f) Notwithstanding anything in this Agreement to the contrary, except
as may arise from the Administrator's willful misfeasance, fraud,
bad faith, negligence or reckless disregard, (i) the
Administrator shall not be liable for losses, delays, failure,
errors, interruption or loss of data occurring directly or
indirectly by reason of circumstances beyond its reasonable
control, including without limitation acts of God; action or
inaction of civil or military authority; public enemy; war;
terrorism; riot; fire; flood; sabotage; epidemics; labor
disputes; civil commotion; interruption, loss or malfunction of
utilities, transportation, computer or communications
capabilities; insurrection; elements of nature; or
non-performance by a third party; and (ii) the Administrator
shall not be under any duty or obligation to inquire into and
shall not be liable for the validity or invalidity, authority or
lack thereof, or truthfulness or
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accuracy or lack thereof, of any instruction, direction, notice,
instrument or other similar information which the Administrator
reasonably believes to be genuine.
Notices
11. (a) Any notice, consent, instruction or other instrument or
communication required or permitted to be given hereunder by a
party may be delivered in person, sent by courier service or
certified or registered post, postage-prepaid, faxed or
transmitted via e-mail to the address of the other parties set
forth below or such other address as may be notified in writing
to the other parties, and shall be deemed to have been properly
delivered or given hereunder and shall be effective on: (i) the
date of delivery if delivered in person or sent by Federal
Express or other recognized courier who obtains a signature
acknowledging receipt; (ii) the date of transmission, if faxed or
transmitted via e-mail, provided that receipt of a facsimile or
e-mail is verified by telephone (and failing such verification,
only upon actual receipt); or (iii) five days after the same has
been tendered for delivery by the post if sent by certified or
registered post, postage prepaid.
(b) Notices to the Fund shall be sent to:
X.X. XXXXXX ATLAS GLOBAL LONG/SHORT EQUITY FUND, L.L.C.
c/o X.X. Xxxxxx Alternative Asset Management, Inc.
Attn: Xxxx X. Xxxxxxx, Chief Administrative Officer
0000 Xxxxxx xx xxx Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Fax: 000-000-0000
Email: Xxxx.Xxxxxxx@xxxxxxxx.xxx
with a copy, in the case of any notice from the Investment Manager,
to the Administrator at the address set forth below in subsection
(c).
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(c) Notices to the Administrator shall be sent to:
PFPC INC.
Attn: Xxxx X. Xxxxxxxx
000 Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Fax: 000-000-0000
E-mail: Xxxx.Xxxxxxxx@xxxx.xxx
(d) Notices to the Investment Manager shall be sent to:
X.X. XXXXXX ALTERNATIVE ASSET MANAGEMENT, INC.
Attn: Xxxx X. Xxxxxxx, Chief Administrative Officer
0000 Xxxxxx xx xxx Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Fax: 000-000-0000
E-mail: Xxxx.Xxxxxxx@xxxxxxxx.xxx
Services Not Exclusive
12. The services of the Administrator hereunder are not to be deemed exclusive
and the Administrator shall be free to render similar or different
services to others so long as its services hereunder are not thereby
impaired. The level of service and staffing support that the Administrator
shall provide to the Fund shall not be inferior in any respect to the
level of service and support provided by the Administrator to any of its
other clients.
Reliance on Information
13. The Administrator may from time to time rely on information provided to it
by or on behalf of other parties appointed as agents by the Managing
Member or the Fund in the course of discharging its duties hereunder,
provided that it acts reasonably and in good faith and is not guilty of
any negligence, willful default or willful misconduct, fraud, bad faith or
reckless disregard in the performance (or non-performance) of its duties
and obligations hereunder.
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Control by Managing Member, Consultation with Investment Manager
14. In the performance of its duties hereunder, the Administrator shall at
all times be subject to the control of and review by the Fund and the
Managing Member, and the Administrator shall in all respects observe
and comply with the LLC Agreement and the Private Placement Memorandum,
comply and conform to all reasonable and proper orders, directions and
regulations of the Fund and the Managing Member, well and faithfully
serve the Fund and use all reasonable endeavors to promote the
interests thereof.
In addition, if:
(a) it comes to the attention of the Administrator that any
administrative or accounting duty normally performed for investment
funds similar to the Fund or any duty due to regulatory or
accounting changes is not being performed for the Fund by the
Administrator pursuant to this Agreement, as it may be amended from
time to time, or
(b) the Administrator is not able to perform its duties under this
Agreement because it is not receiving the required information,
cooperation or other input or assistance from the Fund, or
(c) the Administrator requires additional information or direction
from the Fund,
then the Administrator shall promptly so inform the Fund so that the Fund
may take the appropriate actions.
The Administrator shall regularly consult with the Investment Manager
regarding, and shall inform the Investment Manager of, the performance of
its duties hereunder including, without limitation, the incurrence of
liabilities.
Right to Receive Advice
15. (a) Advice of the Fund. If the Administrator is in doubt as to any
action it should or should not take, the Administrator shall request
directions or advice, including Oral Instructions or Written
Instructions, from the Fund and/or the Investment Manager.
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(b) Advice of Counsel. If the Administrator is in doubt as to any
question of law pertaining to any action it should or should not
take, the Administrator may, following consultation with the
Investment Manager in accordance with subsection (d) below, request
advice from counsel of its own choosing (who may be counsel for the
Fund, the Investment Manager or the Administrator, at the option of
the Administrator). The reasonable costs and expenses of counsel
will be borne by the Fund.
(c) Conflicting Advice. In the event of a conflict between directions or
advice or Oral Instructions or Written Instructions the
Administrator receives from the fund and the advice the
Administrator receives from counsel, the Administrator may,
following consultation with the Investment Manager in accordance
with subsection (d) below, rely upon and follow the advice of
counsel.
(d) Consultation with the Investment Manager. Notwithstanding
subsections (a) to (c) above, the Administrator agrees to act in
accordance with all Oral Instructions and Written Instructions or
to notify the Investment Manager as soon as possible (and in any
event prior to any deadline for execution of such instructions)
of any inability to act in accordance with, or any uncertainty
with respect to, such instructions. Prior to seeking any advice
of counsel pursuant to subsection (b) above, and prior to acting
on the advice of counsel pursuant to subsection (c) above, the
Administrator agrees to provide notice to the Investment Manager
and consult with the Investment Manager (i) regarding the choice
of counsel and the likely cost involved, and (ii) to clarify
and/or resolve the Administrator's concern with the relevant Oral
Instructions or Written Instructions or the conflict between such
instructions and the advice of counsel.
(e) Protection of the Administrator. Subject to Section 10(c), the
Administrator shall be indemnified by the Fund and without
liability for any action the Administrator takes or does not take
in reliance upon directions or advice or Oral Instructions or
Written Instructions the Administrator receives from or on behalf
of the Fund or upon advice of counsel and which the Administrator
believes, in good faith, to be consistent with those directions
or advice and Oral Instructions or Written Instructions. Subject
to subsection (d) above, nothing in this Section 15 shall be
construed so as to impose an obligation upon the Administrator to
seek such directions or advice or Oral Instructions or Written
Instructions.
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(f) Nothing in this Section 15 shall absolve the Administrator from
acting in accordance with the applicable standard of care as is
specifically set forth in this Agreement.
Confidentiality
16. The Administrator hereby agrees that it shall not, except as required
by law or applicable regulations, disclose to any person (and shall
prevent the disclosure or publication by its employees, agents, and/or
delegates) any confidential information relating to the Fund or the
Members of which the Administrator (and/or its agents, employees and/or
delegates) may become possessed in the performance of its duties under
this Agreement. This Section 16 shall survive the termination of this
Agreement.
Non-Solicitation
17. During the term of this Agreement and for a period of one year after
the termination hereof, the Fund and the Investment Manager shall not
directly or indirectly, either for themselves or on behalf of any other
firm, person or entity, solicit to employ or retain as a consultant or
independent contractor, any person who currently is or during the
preceding six (6) month period was, known by the Fund or the Investment
Manager to be in the employ of the Administrator and/or its
affiliates. The Fund and the Investment Manager acknowledge and agree
that due to the uniqueness of the services to be provided by the
Administrator's employees and the confidential nature of the
information such employees will possess, the covenants set forth in
this Section 17 are reasonable and necessary for the protection of the
business and goodwill of the Administrator. The Fund and the
Investment Manager expressly acknowledge the importance to the
Administrator of the covenants set forth in this Section 17 and
recognize that the Administrator would not enter into this Agreement
without the Fund and the Investment Manager's consent hereto.
Property of Books and Records
18. The books and records (excluding the computer software and systems used
by the Administrator to maintain such books and records hereunder)
pertaining to the Fund, which are in the possession or under the
control of the Administrator, shall be the property of the Fund. Such
books and records shall be prepared and maintained as required by
applicable
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laws and regulations. The Fund and any persons authorized by the Fund
shall have access to such books and records upon two business days' notice
during the Administrator's normal business hours. Upon the reasonable
request of the Fund or the Investment Manager, copies of any such books
and records shall be provided by the Administrator to the Fund or the
Investment Manager or any persons authorized by the Fund.
Applicable law and jurisdiction
19. This Agreement shall be construed and the provisions hereof interpreted
under and in accordance with the laws of the State of Delaware. The
parties hereto irrevocably submit to the non-exclusive jurisdiction of the
courts of the States of New York and Delaware.
Representations
20. Each of the parties represents and warrants that it is duly organized
and validly existing under the laws of its own jurisdiction with full
power to carry on its business as now conducted, to enter into this
Agreement and to perform its obligations hereunder. In addition each
of the parties represents and warrants that this Agreement has been
duly and validly authorized, executed and delivered by it, constitutes
a valid and legally binding obligation on it enforceable in accordance
with its terms and no statute, regulation, rule, order, judgement or
contract binding on it prohibits its execution or performance of this
Agreement.
21. No provision of this Agreement may be changed, waived, discharged or
terminated orally, but this Agreement may be changed, waived, discharged
or terminated by an instrument in writing signed by each party.
22. A waiver by any party of any breach of any of the terms, provisions or
conditions of this Agreement or the acquiescence of such party in any act
(whether commission or omission) which but for such acquiescence would be
a breach as aforesaid shall not constitute a general waiver of such term,
provision or condition or of any subsequent act contrary thereto.
23. Each of the provisions of this Agreement are separate and severable and
enforceable and, accordingly, if at any time any provision is adjudged by
any court of competent jurisdiction to be void or unenforceable the
validity, legality and enforceability of the remaining provisions hereof
shall not in any way be affected or impaired thereby.
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24. This Agreement may be executed in several counterparts, each of which
shall be deemed to be an original, and all of which together shall be
deemed to be one and the same instrument.
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IN WITNESS whereof this Agreement has been executed by the parties hereto in the
manner hereinafter appearing on the day and year first above written.
SIGNED by the authorized representative of By: Xxxxxxx Associates, L.L.C., its
X.X. XXXXXX ATLAS GLOBAL LONG/SHORT Managing Member
EQUITY FUND, L.L.C.
/s/ Xxxxxx X. Xxxxxxx
------------------------------------
Signature
Name: Xxxxxx X. Xxxxxxx
Title: Chairman and Sole Member
SIGNED by the authorized representative of /s/ Xxxx Xxxxxxx
------------------------------------
X.X. XXXXXX ALTERNATIVE ASSET Signature
MANAGEMENT, INC.
Name: Xxxx Xxxxxxx
Title: President and Chief
Executive Officer
SIGNED by the authorized representative of /s/ Xxxx Xxxxxxx
------------------------------------
PFPC INC. Signature
Name: Xxxx Xxxxxxx
Title: Senior Vice President
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APPENDIX A
ALL SERVICES SHOULD BE PROVIDED ON A FUND/ CAPITAL ACCOUNT/ CAPITAL CONTRIBUTION
LEVEL
ACCOUNTING AND ADMINISTRATIVE SERVICES
During the continuance of this Agreement, the Administrator shall:
(i) calculate the net asset value of the Fund and each Member's capital
account balance in accordance with the requirements of the LLC Agreement;
(ii) in respect of investments in other investment funds, obtain monthly prices
from each underlying fund's administrator or Portfolio Manager which shall
be checked with the Investment Manager. Additionally, if security market
quotes, currency exchange rates and other pricing information from
independent pricing services are needed the source must be approved by the
Investment Manager;
(iii) obtain written confirmation of all transactions by the Fund, including but
not limited to subscriptions, redemptions and transfers into/out of
underlying investment funds from the underlying fund's administrator or
Portfolio Manager which includes monies subscribed/redeemed/transferred,
shares subscribed/redeemed/transferred and the net asset value at which
the subscription/redemption/transfer was transacted and other pertinent
information provided by the underlying fund's administrator or Portfolio
Manager. The Administrator shall send copies of such written confirmations
to the Investment Manager at the address specified in Section 11(d) of
this Agreement, to the attention of Xxxxxxx Xxxxxx, and shall provide the
Investment Manager every other business day with a report showing all
transactions by the Fund and the status of all written confirmations. If
written confirmation is not received from an underlying fund's
administrator within five days of the effective date of a transaction, the
Administrator shall send a letter to the underlying fund's administrator
within six days of the effective date with a copy to the Investment
Manager at the address specified in Section 11(d) of this Agreement, to
the attention of Xxxxxxx Xxxxxx. Such letter shall state that the Fund has
submitted all of the appropriate documentation for the transaction by the
effective date and that the Fund assumes effective receipt of the
documentation and must receive written confirmation for the transaction
within two business days from receipt of such letter. For the avoidance of
doubt, written confirmations from an underlying fund's administrator or
Portfolio Manager that does not include an acknowledgement that the
transactions have been properly effected as per the underlying fund's
instructions for such transactions shall not be deemed acceptable
confirmations by the underlying funds;
(iv) maintain historical tax lots for each investment in an underlying fund;
(v) calculate on the basis of the information referred to under (iii) above
the market value of the Fund's investments and the appreciation and
depreciation of the investments in accordance with applicable valuation
policies set forth in the LLC Agreement or written
policies and guidelines provided by the Fund or by the Investment Manager
to the Administrator from time to time;
(vi) engage in a monthly review process with the Investment Manager which
includes the following actions:
(a) compare Portfolio Manager returns provided by the Administrator to
those received independently by the Investment Manager. Review all
differences and get resolution between the two;
(b) review transfer documentation and as requested by the Investment
Manager, other documentation as mutually agreed upon between the
Administrator and the Investment Manager;
(c) compare and reconcile client and Portfolio Manager subscription and
redemption amounts provided by the Administrator and Investment
Manager;
(d) prepare and review all fee calculations and incentive allocation
accruals;
(e) prepare and review all balance sheet and income accounts and the
supporting documentation;
(f) prepare and review monthly swap valuations based upon swap contracts
(if any);
(g) monitor the expense accruals and reserves and notify the Fund of any
proposed adjustments; and
(h) calculate capital gains and losses.
Once reviewed by the Investment Manager, the Administrator will finalize
the Fund's net asset value for the month and put out a final monthly
package;
(vii) provide the Investment Manager with a Monthly Accounting Package which
includes:
Financials:
Balance Sheet
Statement of Income
Statement of Changes in Fund Capital
Supporting Schedules:
Net asset value of the Fund and each Member's capital account
balance
Member subscription, transfer and repurchase summaries
2
Schedule of Members (showing % interest in the Fund, the
twenty Members with the largest % interests, domicile
of each Member and indicating whether each Member is
(i) tax-exempt, (ii) subject to ERISA or otherwise a
benefit plan investor, (iii) a foundation, and/or
(iv) a X.X. Xxxxxx Private Bank client, and the
aggregate % interests held by Members in each of
(i)-(iv) above)
Underlying funds subscription, transfer and redemption
summaries
Cash account reconciliation
Portfolio Valuation at Market schedule
Unrealized gain/loss schedule
Management Fee and Incentive Allocation calculations
Detailed accounts receivable, accounts payable and
amortization schedules with aging schedules
Summary of all expenses paid during the month
Swap valuations Trail commission reports
Rate of Return calculations
The Administrator shall provide the Investment Manager with the various
items constituting the Monthly Accounting Package in accordance with
the timeline specified in Appendix B, as amended from time to time;
(viii) provide the Investment Manager on a monthly basis with calculations of
any rebate of the Management Fee or Incentive Allocation that may be
agreed with any Member;
(ix) maintain all books and records as may be required by law or by the
Fund, the Investment Manager or Auditor with respect to the Fund's
investment transactions and render and distribute in respect of the
Fund such periodic and special reports as the Fund or the Investment
Manager may reasonably request and as set forth in the Private
Placement Memorandum. Any such books or records may be maintained in
the form of electronic media and stored on any magnetic disk or tape or
similar recording method;
(x) arrange with the Auditor for and provide reasonable assistance to the
Auditor with respect to the annual audit of the Fund and assisting the
Fund in procuring compliance with all relevant legal and accounting
requirements and other regulatory authorities to which the Fund, the
Managing Member or Investment Manager may be subject;
3
(xi) arrange for the preparation, in consultation with the Auditor, the
Managing Member and the Investment Manager, of the annual reports of
the Fund in accordance with the requirements of any relevant laws;
(xii) prepare and distribute the monthly and/or quarterly unaudited reports
to all Members as outlined in the LLC Agreement and/or Private
Placement Memorandum or more frequently if so requested by the
Investment Manager;
(xiii) generally co-ordinate all periodic tender offers and repurchases of
Interests in accordance with the procedures described in the Private
Placement Memorandum and the LLC Agreement or as otherwise notified to
the Administrator in Written Instructions;
(xiv) coordinate the printing, mailing and tracking of periodic tender
offers;
(xv) prepare and file Schedule TO with the SEC via Xxxxx;
(xvi) collect responses to periodic tender offers;
(xvii) calculate the pro-rata tender amounts in the event a tender offer is
oversubscribed;
(xviii) prepare and distribute to Members any promissory notes issued by the
Fund in connection with any repurchases of Interests;
(xix) maintain on the books and records of the Fund a distinct account
consisting of assets of the Fund in an amount equal to the aggregate
estimated unpaid dollar amount of any promissory notes issued to
Members by the Fund in connection with any repurchases of Interests;
(xx) coordinate with the Fund's escrow agent the deposit of cash amounts
into the Repurchase Account, the calculation and deduction of any
repurchase fee due from a Member and the withholding of any other
required amounts from any repurchase proceeds payable to any Member;
(xxi) assist the Fund in determining whether any suspension of tender offers
and repurchases should take place due to delays in the receipt of
underlying investment valuations and/or revised valuations from
underlying investments and/or any other circumstances that affects the
ability of the Fund to value its assets accurately;
(xxii) calculate and, upon written instructions, arrange for and make the
payment of any fees, expenses or allocations payable by the Fund;
4
(xxiii) upon written instructions from the Investment Manager, perform any
ancillary services related to the Fund's investment activities,
including (a) arranging for and making all payments (by wire transfer
or otherwise from the Fund's bank account) relating to the Fund's
underlying investments, (b) arranging for, receiving and depositing
into the Fund's bank account all redemption/withdrawal payments,
dividends or other proceeds from the Fund's underlying investments, (c)
effecting any transfers into or out of underlying investments on behalf
of the Fund, and (d) such other services as are mutually agreed upon;
(xxiv) upon the receipt of appropriate documentation, perform any ancillary
services related to Fund investor activities, including (a) arranging
for, receiving and depositing into the Fund's bank account all capital
contributions of Members, (b) arranging for and making all repurchase
payments or other distributions to Members, (c) effecting any transfer
of ownership of the Interests, and (d) such other services as are
mutually agreed upon;
(xxv) allocate income, expenses, gains and losses within each Member's
capital account in accordance with the procedures set forth in the LLC
Agreement, and such additional procedures as may be agreed among the
parties from time to time and perform such other activities as outlined
in the LLC Agreement;
(xxvi) update daily and provide to the Investment Manager the cash
availability (including future projected redemption proceeds) as
required by the Investment Manager, including such details as
reasonably requested by the Fund or the Investment Manager;
(xxvii) determine and report applicable foreign exchange gains and losses on
payables and receivables;
(xxviii) as appropriate, compute yields, total return, expense ratios, portfolio
turnover rate, and, if required, portfolio average dollar-weighted
maturity;
(xxix) supply various normal and customary Fund statistical data as requested
on an ongoing basis, in an electronic format;
(xxx) in general provide such services as are required for the keeping of the
accounts of the Fund and the calculation of its net asset value in
accordance with the requirements of applicable laws and regulations and
the terms of the LLC Agreement;
(xxxi) review and execute such subscription, redemption and transfer documents
as may be required by an underlying fund's administrator or Portfolio
Manager to effect any
5
activities of the Fund in connection with its investments in such
underlying fund and any other documents requested by the Investment
Manager;
(xxxii) prepare and distribute annual tax estimates to each Member by December
15th of each year for the current tax year (the "Tax Estimate"). The
Tax Estimate (based on information received from underlying funds) will
include, but not be limited to, the following line items:
- ordinary, interest and dividend income;
- short term capital gain (loss);
- long term capital gain (loss);
- section 988 items;
- net gain (loss) under section 1256;
- investment expense; and
- ordinary deductions;
(xxxiii) provide to the Auditor as soon as available, any information and
documentation necessary for preparation of Form K-1s for the Members.
(xxxiv) Mail annually to each Member a Form K-1 as provided by the Auditor.
REGISTRAR AND TRANSFER AGENCY SERVICES
During the continuance of this Agreement, the Administrator shall:
(i) maintain a register of Members and enter on such register all capital
contributions, repurchases and transfers of Interests;
(ii) administer all capital contributions, transfers of Interests, tender
offers and repurchases and reconcile the register with the records held
for the determination of the net asset value for the Fund and the
capital account balance of each Member;
(iii) review and accept subscription documents received from the Fund's
investors and process any transfer documents relating to the assignment
and transfer of Interests;
(iv) prepare (where applicable) and distribute reports to Members monthly as
outlined in the LLC Agreement and at such other times as required by
the Managing Member;
(v) transmit to the Fund for the account of the Fund all checks and monies
received by it on behalf of the Fund;
(vi) forward to the Members such notices, reports (including the monthly,
quarterly and annual reports or financial statements) and other written
material as may be required by law, the Managing Member, the Investment
Manager or by the LLC Agreement or the Private Placement Memorandum;
and
(vii) perform additional duties, as mutually agreed upon, which may be
required from time to time under the terms of the LLC Agreement or the
Private Placement Memorandum.
6
FUND ADMINISTRATIVE SERVICES
During the continuance of this Agreement the Administrator shall:
(i) forward directly to the Managing Member and Investment Manager any and
all notices, correspondence and other communications received from
Members and third parties that the Administrator may receive on behalf
of the Fund;
(ii) Upon instruction from the Investment Manager, dispatch all such
circulars, notices of meetings, reports, financial statements and other
written material to all persons entitled to receive the same under
applicable law as the Fund may require;
(iii) prepare and file the Fund's Annual and Semi-Annual Reports with the SEC
on Form N-SAR via XXXXX;
(iv) prepare and file the Fund's Annual and Semi-Annual Reports with the SEC
on Form N-CSR;
(v) provide, to the extent contained in the Fund's accounting records held
by the Administrator, materials required for reporting to the Managing
Member as may be reasonably requested from time to time;
(vi) act as may be required by the Fund from time to time as proxy agent in
connection with the holding of meetings of Members, receive and
tabulate votes cast by proxy and communicate to the Fund the results of
such tabulation (additional fees would apply for these services when
appropriate and mutually agreed upon);
(vii) provide to the Auditor the Form K-1s and tax estimates to the extent
received from the underlying investment funds and administer the
payment on behalf of the Fund of any applicable tax that may be levied;
(viii) liase with the custodian and/or banks of the Fund to (a) obtain from
the custodian and/or bank all necessary information enabling the
Administrator to provide its services hereunder and (b) provide to the
custodian and/or bank all necessary information enabling it to perform
its duties to the Fund;
(ix) control all disbursements and authorize such disbursements from the
Fund's account with the custodian(s) upon Written Instructions;
(x) control and coordinate all movements of cash into and out of the Fund's
account with the custodian(s) and escrow agent, and provide them with
appropriate oral and written instructions, to effect all transactions
on behalf of the Fund in accordance with Oral Instructions and Written
Instructions;
(xi) coordinate contractual relationships and communications between the
Fund and its contractual service providers including auditors, tax
professionals, escrow agent and custodians, as applicable; and
(xii) prepare and present quarterly an Administrator's Report.
7
In connection with the above Fund Administrative Services, the Administrator
may, with the prior written approval of the Investment Manager, engage a
sub-contractor to perform some or all of the services, provided, however, the
Administrator shall remain responsible for the acts or omissions of any such
sub-contractors as if the Administrator had provided the service directly.
REGULATORY ADMINISTRATIVE SERVICES
During the continuance of this Agreement the Administrator shall:
(i) arrange for a representative of the Administrator to attend at any
meetings of the Members of the Fund when so required by the Fund and
prepare agendas, minutes and other documents required at or in
connection with such meetings; the out of pocket expenses incurred in
connection with such attendance, including but not limited to travel,
etc., shall be born by the Fund provided the total expenses are not in
excess of the maximum amount agreed upon in advance by the Fund and the
costs are properly documented by receipts;
(ii) assist in the preparation of post-effective registration amendments and
other filings for the Fund subject to the review of Fund management and
Fund counsel;
(iii) monitor the Fund's assets to assure adequate fidelity bond coverage is
maintained;
(iv) maintain the Fund's corporate calendar to assure compliance with
various filing and Board approval deadlines;
(v) assist in the development of agendas, reports, and Board materials for
Board meetings, and prepare Board books using such materials;
(vi) assist the Fund, the Managing Member and the Investment Manager in
preparing for and complying with regulatory examinations, and provide
assistance with regulatory agencies during their normal review of the
Fund, the Managing Member and the Investment Manager.
8
APPENDIX B
X.X. XXXXXX ATLAS GLOBAL LONG/SHORT EQUITY FUND, L.L.C.
FUND NAV AND MONTHLY ACCOUNTING PACKAGE TIMELINE
TIMING STEP ACTION
------ ---- ------
1. 14TH CALENDAR DAY - CUT PRELIMINARY FUND - Administrator cuts the preliminary Fund NAV and
OF THE MONTH NAV AND PREPARE MONTHLY prepares Monthly Accounting Package (except the
ACCOUNTING PACKAGE WITH Schedule of Members and capital account balances of
VALUATIONS FROM UNDERLYING the Members) with the valuations from the underlying
HEDGE FUNDS hedge funds
- INVESTMENT MANAGER - Administrator sends to Investment Manager
REVIEWS THE PRELIMINARY
FUND NAV AND MONTHLY - Investment Manager receives the preliminary Fund NAV
ACCOUNTING PACKAGE FROM and Monthly Accounting Package from Administrator
ADMINISTRATOR
- Investment Manager reviews the preliminary
Fund NAV and Monthly Accounting Package by
the 15th calendar day and sends it back to
Administrator
2. 15TH CALENDAR DAY - CUT OFF FOR RECEIPT OF - Administrator receives all valuations from the
OF THE MONTH VALUATIONS FROM THE underlying hedge funds by the 15th calendar day
UNDERLYING HEDGE FUNDS
- Administrator produces the final Fund NAV and Monthly
- PRODUCE FINAL FUND NAV Accounting Package (except the Schedule of Members and
AND MONTHLY ACCOUNTING capital account balances of the Members)
PACKAGE
- Administrator sends to Investment Manager for review
3. 16TH CALENDAR DAY - REVIEW AND DISTRIBUTE - Investment Manager receives and reviews the final Fund
OF THE MONTH FINAL FUND NAV AND MONTHLY NAV and Monthly Accounting Package
ACCOUNTING PACKAGE
- Once the final Fund NAV and Monthly Accounting Package
(except the Schedule of Members and capital account
balances of the Members) is completed, Investment Manager
and Administrator will distribute pursuant to operating
procedures
4. WITHIN 3 BUSINESS - PRODUCE SCHEDULE OF - Administrator prepares the Schedule of Members and a
DAYS AFTER THE 16TH MEMBERS AND CAPITAL ACCOUNT schedule of capital account balances for each Member
CALENDAR DAY OF THE BALANCES OF THE MEMBERS
MONTH - Administrator sends to Investment Manager
- Investment Manager receives and reviews Schedule of
Members and schedule of capital account balances for
each Member
