BACAP ALTERNATIVE MULTI-STRATEGY FUND, LLC
ADMINISTRATION, ACCOUNTING AND INVESTOR SERVICES AGREEMENT
THIS AGREEMENT is made as of [___], 2003 by and between BACAP
DISTRIBUTORS, LLC, a Delaware limited liability company ("BACAP"), and BACAP
ALTERNATIVE MULTI-STRATEGY FUND, LLC, a Delaware limited liability company (the
"Fund").
W I T N E S S E T H:
WHEREAS, the Fund 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, the Fund wishes to retain BACAP to provide administration,
accounting and investor services as provided for herein and BACAP wishes to
furnish such services.
NOW, THEREFORE, in consideration of the premises and the 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 officer of the Fund and any other person
duly authorized by the Fund's Board of Managers to give Oral
Instructions and 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.
(d) "Board of Managers" and "Members" shall have the same meanings as set
forth in the Fund's limited liability company agreement (the "Limited
Liability Company Agreement").
(e) "CEA" means the Commodities Exchange Act, as amended.
(f) "Change of Control" means a change in ownership or control (not
including transactions between wholly-owned direct or indirect
subsidiaries of a common parent) of 25% or more of the beneficial
ownership of the shares of common stock or shares of beneficial
interest of an entity or its parent(s).
(g) "Interests" means limited liability company interests in the Fund.
(h) "Oral Instructions" mean oral instructions received by BACAP from an
Authorized Person or from a person reasonably believed by BACAP to be
an Authorized Person. BACAP may, in its sole discretion in each
separate instance, consider and rely upon instructions it receives
from an Authorized Person via electronic mail as Oral Instructions.
(i) "Organizational Documents" mean, in the case of the Fund, the by-laws,
confidential memorandum, Limited Liability Company Agreement, trust
deed or other documents constituting the Fund.
(j) "SEC" means the Securities and Exchange Commission.
(k) "Securities Laws" means the 1933 Act, the 1934 Act, the 1940 Act and
the CEA.
(l) "Written Instructions" mean (i) written instructions signed by an
Authorized Person and received by BACAP or (ii) trade instructions
transmitted (and received by BACAP) by means of an electronic
transaction reporting system access to which requires use of a
password or other authorized identifier. The instructions may be
delivered by hand, mail, tested telegram, cable, telex or facsimile
sending device.
2. Appointment. The Fund hereby appoints BACAP to provide administration,
accounting and investor services, in accordance with the terms set forth in
this Agreement. BACAP accepts such appointment and agrees to furnish such
services.
3. Delivery of Documents. The Fund has provided or, where applicable, will
provide BACAP with the following:
(a) at BACAP's request, certified or authenticated copies of the
resolutions of the Fund's Board of Managers, approving the appointment
of BACAP or its affiliates to provide services to the Fund and
approving this Agreement;
(b) a copy of Fund's most recent effective registration statement;
(c) a copy of the Fund's advisory agreement or agreements;
(d) a copy of the distribution/underwriting agreement with respect to the
Fund;
(e) a copy of each additional administration agreement;
(f) a copy of each distribution and/or Member servicing plan and agreement
made in respect of the Fund; and
(g) copies (certified or authenticated, where applicable) of any and all
amendments or supplements to the foregoing.
4. Compliance with Rules and Regulations. BACAP 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 BACAP hereunder. Except as specifically set
forth herein, BACAP assumes no responsibility for such compliance by the
Fund or other entity.
5. Instructions.
(a) Unless otherwise provided in this Agreement, BACAP shall act only upon
Oral Instructions or Written Instructions.
(b) BACAP shall be entitled to rely upon any Oral Instruction or Written
Instruction it receives from an Authorized Person (or from a person
reasonably believed by BACAP to be an Authorized Person) pursuant to
this Agreement. BACAP may assume that any Oral Instruction or Written
Instruction received hereunder is not in any way inconsistent with the
provisions of Organizational Documents or this Agreement or of any
vote, resolution or proceeding of the Fund's Board of Managers or of
the Fund's Members, unless and until BACAP receives Written
Instructions to the contrary.
(c) The Fund agrees to forward to BACAP Written Instructions confirming
Oral Instructions (except where such Oral Instructions are given by
BACAP or its affiliates) so that BACAP receives the Written
Instructions by the close of business on the same day that such Oral
Instructions are received. The fact that such confirming Written
Instructions are not received by BACAP or differ from the Oral
Instructions shall in no way invalidate the transactions or
enforceability of the transactions authorized by the Oral Instructions
or BACAP's ability to rely upon such Oral Instructions.
6. Right to Receive Advice.
(a) Advice of the Fund. If BACAP is in doubt as to any action it should or
should not take, BACAP may request directions or advice, including
Oral Instructions or Written Instructions, from the Fund.
(b) Advice of Counsel. If BACAP shall be in doubt as to any question of
law pertaining to any action it should or should not take, BACAP may
request advice from counsel of its own choosing (who may be counsel
for the Fund, the Fund's investment adviser or BACAP, at the option of
BACAP).
(c) Conflicting Advice. In the event of a conflict between directions or
advice or Oral Instructions or Written Instructions BACAP receives
from the Fund and the advice BACAP receives from counsel, BACAP may
rely upon and follow the advice of counsel.
(d) Protection of BACAP. BACAP shall be indemnified by the Fund and
without liability for any action BACAP takes or does not take in
reliance upon directions or advice or Oral Instructions or Written
Instructions BACAP receives from or on behalf of the Fund or from
counsel and which BACAP believes, in good faith, to be consistent with
those directions or advice and Oral Instructions or Written
Instructions. Nothing in this section shall be construed so as to
impose an obligation upon BACAP (i) to seek such directions or advice
or Oral Instructions or Written Instructions, or (ii) to act in
accordance with such directions or advice or Oral Instructions or
Written Instructions.
7. Records; Visits.
(a) The books and records pertaining to the Fund which are in the
possession or under the control of BACAP shall be the property of the
Fund. Such books and records shall be prepared and maintained as
required by the 1940 Act and other applicable securities laws, rules
and regulations. The Fund and Authorized Persons shall have access to
such books and records at all times during BACAP's normal business
hours. Upon the reasonable request of the Fund, copies of any such
books and records shall be provided by BACAP to the Fund or to an
Authorized Person, at the Fund's expense.
(b) BACAP shall keep the following records: (i) all books and records with
respect to the Fund's books of account; (ii) records of the Fund's
securities transactions; and (iii) all other books and records as
BACAP is required to maintain pursuant to Rule 31a-1 of the 1940 Act
in connection with the services provided hereunder.
8. Confidentiality. Each party shall keep confidential any information
relating to the other party's business ("Confidential Information").
Confidential Information shall include (a) any data or information that is
competitively sensitive material, and not generally known to the public,
including, but not limited to, information about product plans, marketing
strategies, finances, operations, customer relationships, customer
profiles, customer lists, sales estimates, business plans, and internal
performance results relating to the past, present or future business
activities of the Fund or BACAP, their respective subsidiaries and
affiliated companies and the customers, clients and suppliers of any of
them; (b) any scientific or technical information, design, process,
procedure, formula, or improvement that is commercially valuable and secret
in the sense that its confidentiality affords the Fund or BACAP a
competitive advantage over its competitors; (c) all confidential or
proprietary concepts, documentation, reports, data, specifications,
computer software, source code, object code, flow charts, databases,
inventions, know-how, and trade secrets, whether or not patentable or
copyrightable; and (d) anything designated as confidential.
Notwithstanding the foregoing, information shall not be subject to
such confidentiality obligations if it: (a) is already known to the
receiving party at the time it is obtained; (b) is or becomes publicly
known or available through no wrongful act of the receiving party; (c) is
rightfully received from a third party who, to the best of the receiving
party's knowledge, is not under a duty of confidentiality; (d) is released
by the protected party to a third party without restriction; (e) is
required to be disclosed by the receiving party pursuant to a requirement
of a court order, subpoena, governmental or regulatory agency or law
(provided the receiving party will provide the other party written notice
of such requirement, to the extent such notice is permitted); (f) is
relevant to the defense of any claim or cause of action asserted against
the receiving party; or (g) has been or is independently developed or
obtained by the receiving party.
9. Liaison with Accountants. BACAP shall act as liaison with the Fund's
independent public accountants and shall provide account analyses, fiscal
year summaries, and other audit-related schedules with respect to the Fund.
BACAP 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 accountants for the expression of their opinion, as
required by the Fund.
10. BACAP System. BACAP shall retain title to and ownership of any and all data
bases, computer programs, screen formats, report formats, interactive
design techniques, derivative works, inventions, discoveries, patentable or
copyrightable matters, concepts, expertise, patents, copyrights, trade
secrets, and other related legal rights utilized by BACAP in connection
with the services provided by BACAP to the Fund.
11. Disaster Recovery. BACAP shall enter into and shall maintain in effect with
appropriate parties one or more agreements making reasonable provisions for
emergency use of electronic data processing equipment to the extent
appropriate equipment is available. In the event of equipment failures,
BACAP shall, at no additional expense to the Fund, take reasonable steps to
minimize service interruptions. BACAP 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 BACAP's own willful
misfeasance, bad faith, gross negligence or reckless disregard of its
duties or obligations under this Agreement.
12. Compensation. As compensation for services rendered by BACAP during the
term of this Agreement, the Fund will pay to BACAP a fee or fees as may be
agreed to in writing by the Fund and BACAP.
13. Indemnification. The Fund agrees to indemnify, defend and hold harmless
BACAP and its affiliates, including their respective officers, directors,
agents and employees from all taxes, charges, expenses, assessments, claims
and liabilities (including, without limitation, attorneys' fees and
disbursements and liabilities arising under the Securities Laws and any
state and foreign securities and blue sky laws) arising directly or
indirectly from any action or omission to act which BACAP takes in
connection with the provision of services to the Fund. Neither BACAP, nor
any of its affiliates, shall be indemnified against any liability (or any
expenses incident to such liability) caused by BACAP's or its affiliates'
own willful misfeasance, bad faith, gross negligence or reckless disregard
in the performance of BACAP's activities under this Agreement. The
provisions of this Section 13 shall survive termination of this Agreement.
14. Responsibility of BACAP.
(a) BACAP shall be under no duty to take any action hereunder on behalf of
the Fund except as specifically set forth herein or as may be
specifically agreed to by BACAP and the Fund in a written amendment
hereto. BACAP shall be obligated to exercise care and diligence in the
performance of its duties hereunder and to act in good faith in
performing services provided for under this Agreement. BACAP shall be
liable only for any damages arising out of BACAP's failure to perform
its duties under this Agreement to the extent such damages arise out
of BACAP's willful misfeasance, bad faith, gross negligence or
reckless disregard of such duties.
(b) Notwithstanding anything in this Agreement to the contrary, (i) BACAP
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) BACAP 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 accuracy or
lack thereof, of any instruction, direction, notice, instrument or
other information which BACAP reasonably believes to be genuine.
(c) Notwithstanding anything in this Agreement (whether contained anywhere
in Sections 15-17 or otherwise) to the contrary, Fund hereby
acknowledges and agrees that (i) BACAP, in the course of providing
tax-related services or calculating and reporting portfolio
performance hereunder, may rely upon BACAP's interpretation of tax
positions or its interpretation of relevant circumstances (as
determined by BACAP) in providing such tax services and in determining
methods of calculating portfolio performance to be used, and that (ii)
BACAP shall not be liable for losses or damages of any kind associated
with such reliance except to the extent such loss or damage is
substantially due to BACAP's gross negligence or willful misconduct.
(d) Notwithstanding anything in this Agreement to the contrary, without
limiting anything in the immediately preceding sentence, Fund hereby
acknowledges and agrees that BACAP shall not be liable for any losses
or damages of any kind associated with any tax filings with which
BACAP has assisted in any way except to the extent such loss or damage
is substantially due to BACAP's gross negligence or willful
misconduct; provided, however, that BACAP shall not be found to have
been grossly negligent for losses or damages associated with areas of
responsibility that the judiciary, regulators (or other governmental
officials) or members of the hedge fund industry determine would
otherwise apply to BACAP (or similar service providers) and which, as
of the date hereof, have yet to be identified by such parties as areas
for which BACAP (or any similar service provider) is (or would be)
responsible.
(e) Notwithstanding anything in this Agreement to the contrary, (i)
neither BACAP 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 BACAP or its
affiliates and (ii) BACAP's cumulative liability to the Fund for all
losses, claims, suits, controversies, breaches or damages for any
cause whatsoever (including but not limited to those arising out of or
related to this Agreement) and regardless of the form of action or
legal theory shall not exceed the lesser of $100,000 or the fees
received by BACAP for services provided hereunder during the 12 months
immediately prior to the date of such loss or damage.
(f) No party may assert a cause of action against BACAP or any of its
affiliates that allegedly occurred more than 12 months immediately
prior to the filing of the suit (or, if applicable, commencement of
arbitration proceedings) alleging such cause of action.
(g) Each party shall have a duty to mitigate damages for which the other
party may become responsible.
(h) The provisions of this Section 14 shall survive termination of this
Agreement.
15. Description of Accounting Services on a Continuous Basis. BACAP will
perform the following accounting services with respect to the Fund:
(a) Journalize investment, capital share and income and expense
activities;
(b) Maintain individual ledgers for investment securities;
(c) Maintain historical tax lots for each security;
(d) Reconcile cash and investment balances of the Fund with the Custodian;
(e) Post to and prepare the Statement of Assets and Liabilities and the
Statement of Operations;
(f) Calculate various contractual expenses (e.g., advisory and custody
fees);
(g) Monitor the expense accruals and notify an officer of the Fund of any
proposed adjustments;
(h) Control all disbursements and authorize such disbursements upon
Written Instructions;
(i) Calculate capital gains and losses;
(j) Determine net income;
(k) Obtain security market quotes from independent pricing services
approved by the Adviser, or if such quotes are unavailable, then
obtain such prices from the Adviser, and in either case calculate the
market value of the Fund's Investments;
(l) Transmit or mail a copy of the daily portfolio valuation to the
Adviser;
(m) Compute net asset value;
(n) As appropriate, compute yields, total return, expense ratios,
portfolio turnover rate, and, if required, portfolio average
dollar-weighted maturity; and
(o) Prepare a monthly financial statement, which will include the
following items: Schedule of Investments Statement of Assets and
Liabilities Statement of Operations Statement of Changes in Net Assets
Cash Statement Schedule of Capital Gains and Losses.
16. Description of Administration Services on a Continuous Basis. BACAP will
perform the following administration services with respect to the Fund:
(a) Prepare quarterly broker security transactions summaries;
(b) Prepare monthly security transaction listings;
(c) Supply various normal and customary Fund statistical data as requested
on an ongoing basis;
(d) Prepare for execution and file the Fund's Federal and state tax
returns;
(e) Prepare and file the Fund's Semi-Annual Reports with the SEC on Form
N-SAR;
(f) Prepare and file with the SEC the Fund's annual, semi-annual, and
quarterly Member reports;
(g) Assist in the preparation of registration statements and other filings
relating to the registration of Interests; and
(h) Coordinate contractual relationships and communications between the
Fund and its contractual service providers.
17. Description of Investor Services on a Continuous Basis. BACAP will
perform the following functions:
(a) Maintain the register of Members of the Fund and enter on such
register all issues, transfers and repurchases of Interests in the
Fund;
(b) Arrange for the calculation of the issue and repurchase prices of
Interests in the Fund in accordance with the Limited Liability Company
Agreement;
(c) Allocate income, expenses, gains and losses to individual Member's
capital accounts in accordance with the Fund's Limited Liability
Company Agreement;
(d) Calculate the Incentive Allocation, if applicable, in accordance with
the Limited Liability Company Agreement and reallocate corresponding
amounts from the applicable Member's capital accounts to the Board of
Managers' capital account; and
(e) Prepare and mail annually to partners any required Form K-1 in
accordance with applicable tax regulations.
18. Duration and Termination. This Agreement shall continue until terminated by
the Fund or by BACAP on sixty (60) days' prior written notice to the other
party. In the event the Fund gives notice of termination, all expenses
associated with movement (or duplication) of records and materials and
conversion thereof to a successor accounting and administration services
agent(s) (and any other service provider(s)), and all trailing expenses
incurred by BACAP, will be borne by the Fund.
19. Change of Control. Notwithstanding any other provision of this Agreement,
in the event of an agreement to enter into a transaction that would result
in a Change of Control of the Fund's adviser or sponsor, the Fund's ability
to terminate the Agreement pursuant to Section 17 will be suspended from
the time of such agreement until two years after the Change of Control.
20. Notices. Notices shall be addressed:
(a) if to BACAP, at 000 Xxxxx Xxxxx Xx., Xxxxxxxxx, XX 00000, Attention:
[___];
(b) if to the Fund, at 000 Xxxxx Xxxxx Xx., Xxxxxxxxx, XX 00000,
Attention: [___]; or
(c) if to neither of the foregoing, at such other address as shall have
been given by like notice to the sender of any such notice or other
communication by the other party. 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.
21. 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.
22. Delegation. BACAP may delegate its rights and obligations hereunder to any
other person (the "Sub-Administrator"), provided that the Sub-Administrator
agrees to provisions substantially similar to those contained in this
Agreement. BACAP shall be responsible for all fees payable to the
Sub-Administrator.
23. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
24. Further Actions. Each party agrees to perform such further acts and execute
such further documents as are necessary to effectuate the purposes hereof.
25. Miscellaneous.
(a) Notwithstanding anything in this Agreement to the contrary, the Fund
agrees not to make any modifications to its registration statement or
adopt any policies which would affect materially the obligations or
responsibilities of BACAP hereunder without the prior written approval
of BACAP, which approval shall not be unreasonably withheld or
delayed.
(b) Except as expressly provided in this Agreement, BACAP hereby disclaims
all representations and warranties, express or implied, made to the
Fund or any other person, including, without limitation, any
warranties regarding quality, suitability, merchantability, fitness
for a particular purpose or otherwise (irrespective of any course of
dealing, custom or usage of trade), of any services or any goods
provided incidental to services provided under this Agreement. BACAP
disclaims any warranty of title or non-infringement except as
otherwise set forth in this Agreement.
(c) 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. 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. Notwithstanding any provision hereof, the
services of BACAP are not, nor shall they be, construed as
constituting legal advice or the provision of legal services for or on
behalf of the Fund or any other person.
(d) This Agreement shall be deemed to be a contract made in Delaware and
governed by Delaware law, without regard to principles of conflicts of
law.
(e) 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. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and
their respective successors and permitted assigns.
(f) 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.
BACAP DISTRIBUTORS, LLC
By: ____________________________________
Title: _________________________________
BACAP ALTERNATIVE MULTI-STRATEGY FUND, LLC
By: ____________________________________
Title: _________________________________
03564.0004 #375569
