EXHIBIT (k)(2)
ADMINISTRATION , ACCOUNTING AND INVESTOR SERVICES AGREEMENT
THIS AGREEMENT is made as of September 8, 1999 by and between PW ASPEN
FUND, L.L.C., a Delaware limited liability company (the "Fund"), and PFPC INC.,
a Delaware corporation ("PFPC"), which is an indirect subsidiary of PNC Bank
Corp.
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 PFPC to provide certain administration,
accounting and investor services provided for herein, and PFPC 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 person duly authorized by the Fund's
Board to give Oral Instructions and Written Instructions on behalf of
the Fund and listed on the Authorized Persons Appendix attached hereto
or any amendment thereto as may be received by PFPC from time to time.
An Authorized Person's scope of authority may be limited to the extent
set forth in the Authorized Persons Appendix.
(d) "CEA" means the Commodities Exchange Act, as amended.
(e) "BOARD" and "MEMBERS" shall have the same meanings as set forth in the
Fund's limited liability company agreement (the "Limited Liability
Fund Agreement").
(f) "MANAGER" means PW Aspen Management, L.L.C.
(g) "ORAL INSTRUCTIONS" mean oral instructions received by PFPC from an
Authorized Person or from a person reasonably believed by PFPC 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 or a person reasonably believed by PFPC to be an
Authorized Person and received by PFPC. The instructions may be
delivered by hand, mail, tested telegram, cable, telex or facsimile
sending device.
2. APPOINTMENT. The Fund hereby appoints PFPC to provide administration,
accounting and investor services to the Fund, in accordance with the terms
set forth in this Agreement. PFPC accepts such appointment and agrees to
furnish such services.
3. DELIVERY OF DOCUMENTS. The Fund has provided or, where applicable, will
provide PFPC with the following:
(a) certified or authenticated copies of the resolutions of the Board,
approving the appointment of PFPC or its affiliates to provide
services and approving this Agreement;
(b) a copy of the Fund's most recent effective registration statement on
Form N-2 under the 1940 Act, as filed with the SEC;
(c) a copy of the Limited Liability Company Agreement;
(d) a copy of any distribution agreement with respect to the Fund;
(e) a copy of any additional administration agreement with respect to the
Fund;
(f) a copy of any investor servicing agreement made with respect to 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.
PFPC 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 PFPC hereunder. Except as specifically set forth herein, PFPC assumes no
responsibility for such compliance by the Fund or any other party.
5. INSTRUCTIONS.
(a) Unless otherwise provided in this Agreement, PFPC shall act only upon
Oral Instructions and Written Instructions.
(b) PFPC shall be entitled to rely upon any Oral Instructions or Written
Instructions it receives from an Authorized Person (or from a person
reasonably believed by PFPC to be an Authorized Person) pursuant to
this Agreement. PFPC 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 Board or the Members, unless and
until PFPC receives Written Instructions to the contrary.
(c) The Fund agrees to forward to PFPC Written Instructions confirming
Oral Instructions and shall endeavor to ensure that PFPC 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 PFPC shall in no way
invalidate the transactions or enforceability of the transactions
authorized by the Oral Instructions. Where Oral Instructions or
Written Instructions reasonably appear to have been received from an
Authorized Person, PFPC shall incur no liability to the Fund in acting
upon such Oral Instructions or Written Instructions provided that
PFPC's actions comply with the other provisions of this Agreement.
6. RIGHT TO RECEIVE ADVICE.
(a) Advice of the Fund. If PFPC is in doubt as to any action it should or
should not take, PFPC may request directions or advice, including Oral
Instructions or Written Instructions, from the Fund.
(b) Advice of Counsel. If PFPC shall be in doubt as to any question of law
pertaining to any action it should or should not take, PFPC may
request advice at its own cost from such counsel of its own choosing
(who may, without limitation, be counsel for the Fund, or PFPC, at the
option of PFPC), provided that such counsel is selected with
reasonable care.
(c) Conflicting Advice. In the event of a conflict between directions,
advice or Oral Instructions or Written Instructions PFPC receives from
the Fund, and the advice PFPC receives from counsel selected with
reasonable care, PFPC may rely upon and follow the advice of such
counsel. PFPC shall promptly inform the Fund of such conflict. If PFPC
relies on the advice of counsel, PFPC will remain liable for any
action or omission on the part of PFPC which constitutes willful
misfeasance, bad faith, gross negligence or reckless disregard by PFPC
of any duties, obligations or responsibilities set forth in this
Agreement.
(d) Protection of PFPC. PFPC shall be protected in any action it takes or
does not take in reliance upon directions, advice or Oral Instructions
or Written Instructions it receives from the Fund or from counsel
selected with reasonable care and which PFPC believes, in good faith,
to be consistent with those directions, advice and Oral Instructions
or Written Instructions. Nothing in this section shall be construed so
as to impose an obligation upon PFPC (i) to seek such directions,
advice or Oral Instructions or Written Instructions, or (ii) to act in
accordance with such directions, advice or Oral Instructions or
Written Instructions unless, under the terms of other provisions of
this Agreement, the same is a condition of PFPC's properly taking or
not taking such action. Nothing in this subsection shall excuse PFPC
when an action or omission on the part of PFPC constitutes willful
misfeasance, bad faith, gross negligence or reckless disregard by PFPC
of any duties, obligations or responsibilities set forth in this
Agreement.
7. RECORDS; VISITS.
(a) The books and records pertaining to the Fund, which are in the
possession or under the control of PFPC, 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 PFPC's normal business
hours. Upon the reasonable request of the Fund, copies of any such
books and records shall be provided by PFPC to the Fund or to an
Authorized Person, at the Fund's expense.
(b) PFPC 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 the Fund is required to maintain
pursuant to Rule 31a-1 of the 1940 Act in connection with the
services of PFPC provided hereunder.
(c) Upon termination of this Agreement, PFPC in accordance with the Fund's
reasonable request, shall, in accordance with Written Instructions,
deliver a copy of the books and records pertaining to the Fund, which
are in the possession or under control of PFPC, to the Fund or any
other person designated by the Fund.
8. CONFIDENTIALITY. PFPC agrees to keep confidential all records of the Fund
and information relating to the Fund and its Members, unless the release of
such records or information is otherwise consented to, in writing, by the
Fund. The Fund agrees that such consent shall not be unreasonably withheld.
The Fund further agrees that, should PFPC be required to provide such
information or records to duly constituted authorities (who may institute
civil or criminal contempt proceedings for failure to comply), PFPC shall
not be required to seek the Fund's consent prior to disclosing such
information.
9. LIAISON WITH ACCOUNTANTS. PFPC shall act as liaison with the Fund's
independent public accountants and shall provide account analyses, fiscal
year summaries, and other audit-related schedules as the Fund or such
accountants may reasonably request. PFPC shall take all reasonable action
in the performance of its duties under this Agreement to ensure that the
necessary information is made available to such accountants for the
expression of their opinion, as required by the Fund.
10. DISASTER RECOVERY. PFPC 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,
PFPC shall, at no additional expense to the Fund, take reasonable steps to
minimize service interruptions. PFPC 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 PFPC's own willful
misfeasance, bad faith, gross negligence or reckless disregard of its
duties or obligations under this Agreement.
11. YEAR 2000 READINESS DISCLOSURE. PFPC (a) has reviewed its business and
operations as they relate to the services provided hereunder, (b) has
developed or is developing a program to remediate or replace computer
applications and systems, and (c) has developed a testing plan to test the
remediation or replacement of computer applications/systems, in each case,
to address on a timely basis the risk that certain computer
applications/systems used by PFPC may be unable to recognize and perform
properly date sensitive functions involving dates prior to, including and
after December 31, 1999, including dates such as February 29, 2000 (the
"Year 2000 Challenge"). To the best of PFPC's knowledge and belief, the
reasonably foreseeable consequences of the Year 2000 Challenge will not
adversely effect PFPC's ability to perform its duties and obligations under
this Agreement.
12. COMPENSATION. As compensation for services rendered by PFPC during the term
of this Agreement, the Fund will pay to PFPC a fee or fees as may be agreed
to in writing by the Fund and PFPC.
13. INDEMNIFICATION.
(a) The Fund agrees to indemnify and hold harmless PFPC and its affiliates
from all taxes, charges, expenses, assessments, claims and liabilities
(including, without limitation, liabilities arising under the
Securities Laws and any state or foreign securities and Blue Sky laws,
and amendments thereto), and expenses, including, without, limitation
reasonable attorneys' fees and disbursements (collectively, "Losses")
arising directly or indirectly from any action which PFPC takes or
does not take (i) at the request or on the direction of or in reliance
on the advice of the Fund or (ii) upon Oral Instructions or Written
Instructions. Neither PFPC, nor any of its affiliates, shall be
indemnified against any liability (or any expenses incident to such
liability) arising out of PFPC's or its affiliates own willful
misfeasance, bad faith, gross negligence or reckless disregard of its
duties and obligations under this Agreement.
(b) Notwithstanding anything in this Agreement to the contrary, the Fund
shall not be liable to PFPC or its affiliates for any consequential,
special or indirect losses or damages which PFPC or its affiliates may
incur or suffer, whether or not the likelihood of such losses or
damages was known by the Fund.
14. RESPONSIBILITY OF PFPC.
(a) PFPC shall be under no duty to take any action on behalf of the Fund
except as specifically set forth herein or as may be specifically
agreed to by PFPC in writing. PFPC shall be obligated to exercise care
and diligence in the performance of its duties hereunder, to act in
good faith and to use its best efforts, within reasonable limits, in
performing services provided for under this Agreement. PFPC agrees to
indemnify and hold harmless the Fund from Losses arising out of PFPC's
failure to perform its duties under this Agreement to the extent such
damages arise out of PFPC's willful misfeasance, bad faith, gross
negligence or reckless disregard of such duties.
(b) Without limiting the generality of the foregoing or of any other
provision of this Agreement, (i) PFPC shall not be liable for losses
beyond its control, provided that PFPC has acted in accordance with
the standard of care set forth above; and (ii) PFPC shall not be
liable for (A) the validity or invalidity or authority or lack thereof
of any Oral Instruction or Written Instruction, notice or other
instrument which conforms to the applicable requirements of this
Agreement, and which PFPC reasonably believes to be genuine; or (B)
subject to Section 10 of this Agreement, delays or errors or loss of
data occurring by reason of circumstances beyond PFPC's control,
including acts of civil or military authority, national emergencies,
labor difficulties, fire, flood, catastrophe, acts of God,
insurrection, war, riots or failure of the mails, transportation,
communication or power supply.
(c) Notwithstanding anything in this Agreement to the contrary, neither
PFPC nor its affiliates shall be liable to the Fund for any
consequential, special or indirect losses or damages which the Fund
may incur or suffer by or as a consequence of PFPC's or any
affiliates' performance of the services provided hereunder, whether or
not the likelihood of such losses or damages was known by PFPC or its
affiliates.
15. DESCRIPTION OF ACCOUNTING SERVICES ON A CONTINUOUS BASIS.
PFPC will perform the following accounting services:
(i) Journalize investment, capital and income and expense activities;
(ii) Verify investment buy/sell trade tickets when received from the
Manager in accordance with PFPC's written procedures;
(iii) Maintain individual ledgers for investment securities;
(iv) Maintain historical tax lots for each security;
(v) Record and reconcile corporate action activity and all other
capital changes with the Manager;
(vi) Reconcile cash and investment balances of the Fund with the
custodian, and provide the Manager with the beginning cash
balance available for investment purposes.
(vii) Update the cash availability throughout the day as required by
the Manager, including details of cash movements related to
securities and payment of Fund expenses;
(viii) Calculate contractual expenses (e.g. advisory and custody fees)
in accordance with the Fund's Confidential Memorandum;
(ix) Maintain expense budget for the Fund and notify an officer of the
Fund of any proposed adjustments;
(x) Control all disbursements and authorize such disbursements from
the Fund's account at the custodian upon Written Instructions;
(xi) Calculate capital gains and losses;
(xii) Determine net income;
(xiii) Determine applicable foreign exchange gains and losses on
payables and receivables;
(xiv) Interface with global custodian to monitor collection of tax
reclaims;
(xv) Obtain daily security market quotes from independent pricing
services approved by the Manager, or if such quotes are
unavailable, then obtain such prices from the Manager, and in
either case calculate the market value and the
appreciation/depreciation on the Fund's investments;
(xvi) Transmit or otherwise send a copy of the daily portfolio
valuation to the Manager;
(xvii) Compute net asset values monthly;
(xviii) Research and recommend portfolio accounting tax treatment for
unique security types; and
(xix) As appropriate, compute yields, total return, expense ratios,
portfolio turnover rate, and, if required, portfolio average
dollar-weighted maturity in accordance with applicable
regulations.
16. DESCRIPTION OF ADMINISTRATION SERVICES ON A CONTINUOUS BASIS. PFPC will
perform the following administration services:
(i) Prepare quarterly broker security transactions summaries
including principal and agency transactions and related
commissions;
(ii) Prepare monthly security transaction listings;
(iii) Supply various normal and customary Fund statistical data as
requested on an ongoing basis;
(iv) Provide to the extent contained in accounting records materials
required for board reporting as may be requested from time to
time;
(v) Prepare for execution and file the Fund's Federal Form 1065 and
state tax returns;
(vi) Prepare and file the Fund's Annual and Semi-Annual Reports with
the SEC on Form N-SAR via XXXXX;
(vii) Prepare and coordinate the services of the Fund's printer for
the printing of and filing with the SEC via XXXXX the Fund's
annual and semi-annual shareholder reports;
(viii) Assist in the preparation of registration statements;
(ix) Transmit or otherwise send, to the extent practicable and
feasible, requested detailed information related to the Members,
including admission details, income, capital gains and losses,
and performance detail;
(x) Mail Fund offering materials to prospective investors; and
(xi) Mail quarterly reports of the Manager and Semi-Annual Financial
Statements to investors as well as any other necessary
correspondence.
17. DESCRIPTION OF INVESTOR SERVICES ON A CONTINUOUS BASIS. PFPC will perform
the following functions:
(i) Maintain the register of Members and enter on such register all
issues, transfers and repurchases of interests in the Fund;
(ii) Arrange for the calculation of the issue and repurchase prices of
interests in the Fund in accordance with the Limited Liability
Company Agreement and the Fund's Confidential Memorandum;
(iii) Allocate income, expenses, gains and losses to individual
Members' capital accounts in accordance with applicable tax laws
and with the Fund's Confidential Memorandum;
(iv) Calculate the Incentive Allocation in accordance with the Fund's
Confidential Memorandum and reallocate corresponding amounts from
the applicable Members' accounts to the Manager's account;
(v) Prepare and mail annually to Members a Form K-1 in accordance
with applicable tax regulations; and
(vi) Mail tender offers to Members for purposes of executing
repurchases.
18. DURATION AND TERMINATION. This Agreement shall be effective on the date
first above written and shall continue in effect for an initial period of
two years. Thereafter, this Agreement, unless terminated, shall continue
automatically for successive terms of one (1) year. This Agreement may be
terminated by either party upon 60 days' prior written notice to the other
party.
19. 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 PFPC, at 000 Xxxxxxxx
Xxxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attn: Xxxx X. Xxxxxxx; (b) if to the
Fund, at c/o PaineWebber Incorporated, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attn: Xxxx X. Xxxxxxxxx, Esq.; 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.
20. 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.
21. DELEGATION; ASSIGNMENT. PFPC may assign its rights and delegate its duties
hereunder to any affiliate (as defined in the 0000 Xxx) of or any
majority-owned direct or indirect subsidiary of PFPC Inc., or PNC Bank
Corp., provided that (i) PFPC gives the Fund (60) days' prior written
notice; (ii) the delegate (or assignee) agrees with PFPC and the Fund to
comply with all relevant provisions 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 delegate (or assignee)
hereunder; and (iii) PFPC and such delegate (or assignee) promptly provide
such information as the Fund may request, and respond to such questions as
the Fund may ask, relative to the delegation (or assignment), including,
without limitation, the capabilities of the delegate (or assignee).
22. 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.
23. FURTHER ACTIONS. Each party agrees to perform such further acts and execute
such further documents as are necessary to effectuate the purposes hereof.
24. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement embodies the entire agreement and
understanding between the parties with respect to the subject matter
hereof and supersedes all prior agreements and understandings relating
to the subject matter hereof.
(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
Delaware and governed by Delaware 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.
PFPC INC.
By: ________________________________
Title: _______________________________
PW ASPEN FUND, L.L.C.
By: ________________________________
Title: ______________________________
AUTHORIZED PERSONS APPENDIX
NAME (TYPE) SIGNATURE
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