BACAP ALTERNATIVE MULTI-STRATEGY FUND, LLC
FORM OF SUB-ADMINISTRATION AGREEMENT
THIS AGREEMENT is made as of ________, [____] by and between
BACAP DISTRIBUTORS, LLC, a Delaware limited liability company
("BACAP"), and [______], ("Sub-Administrator").
W I T N E S S E T H:
WHEREAS, BACAP Alternative Multi-Strategy Fund, LLC ("xxx Xxxx") 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 has retained BACAP to provide administration,
accounting and investor services as provided in the Administration, Accounting
and Investor Services Agreement dated [________], 2003, between BACAP and the
Fund, and BACAP has agreed to furnish such services.
WHEREAS, BACAP wishes to retain Sub-Administrator to provide
administration, accounting and investor services to BACAP with respect to the
Fund.
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
Sub-Administrator from an Authorized Person or from a person
reasonably believed by Sub-Administrator to be an Authorized Person.
Sub-Administrator 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
prospectus, statement of additional information, Limited Liability
Company Agreement, 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 Sub-Administrator or (ii) trade
instructions transmitted (and received by Sub-Administrator) 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. BACAP hereby appoints Sub-Administrator to provide
administration, accounting and investor services with respect to the
Fund, in accordance with the terms set forth in this Agreement. The
Sub-Administrator accepts such appointment and agrees to furnish such
services.
3. Delivery of Documents. BACAP has provided or, where applicable, will
provide Sub-Administrator with the following:
(a) at Sub-Administrator's request, certified or authenticated copies of
the resolutions of the Fund's Board of Managers, approving the
appointment of BACAP to provide services to the Fund;
(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. Sub-Administrator undertakes to
comply with all applicable requirements of the Securities Laws, and any
laws, rules and regulations of governmental authorities having
jurisdiction with respect to the duties to be performed by
Sub-Administrator hereunder. Except as specifically set forth herein,
Sub-Administrator assumes no responsibility for such compliance by BACAP,
the Fund or other entity.
5. Instructions.
(a) Unless otherwise provided in this Agreement, Sub-Administrator shall
act only upon Oral Instructions or Written Instructions.
(b) Sub-Administrator 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 Sub-Administrator to
be an Authorized Person) pursuant to this Agreement.
Sub-Administrator 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 Sub-Administrator
receives Written Instructions to the contrary.
(c) BACAP agrees to forward to Sub-Administrator Written Instructions
confirming Oral Instructions (except where such Oral Instructions
are given by Sub-Administrator or its affiliates) so that
Sub-Administrator 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 Sub-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
Sub-Administrator's ability to rely upon such Oral Instructions.
6. Right to Receive Advice.
(a) Advice of BACAP. If Sub-Administrator is in doubt as to any action it
should or should not take, Sub-Administrator may request directions or
advice, including Oral Instructions or Written Instructions, from BACAP.
(b) Advice of Counsel. If Sub-Administrator shall be in doubt as to any
question of law pertaining to any action it should or should not take,
Sub-Administrator may request advice from counsel of its own choosing
(who may be counsel for the Fund, the Fund's investment adviser or
Sub-Administrator, at the option of Sub-Administrator).
(c) Conflicting Advice. In the event of a conflict between directions or
advice or Oral Instructions or Written Instructions Sub-Administrator
receives from BACAP or the Fund and the advice Sub-Administrator receives
from counsel, Sub-Administrator may rely upon and follow the advice of
counsel.
(d) Protection of Sub-Administrator. Sub-Administrator shall be indemnified
by BACAP and without liability for any action Sub-Administrator takes or
does not take in reliance upon directions or advice or Oral Instructions
or Written Instructions Sub-Administrator receives from or on behalf of
BACAP or from counsel and which Sub-Administrator 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 Sub-Administrator (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 Sub-Administrator shall be the
property of BACAP. Such books and records shall be prepared and
maintained as required by the 1940 Act and other applicable
securities laws, rules and regulations. BACAP and Authorized Persons
shall have access to such books and records at all times during
Sub-Administrator's normal business hours. Upon the reasonable
request of the BACAP, copies of any such books and records shall be
provided by Sub-Administrator to BACAP or to an Authorized Person,
at BACAP's expense.
(b) Sub-Administrator 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 Sub-Administrator 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 parties' businesses ("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, BACAP or Sub-Administrator, 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, BACAP or Sub-Administrator 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. Sub-Administrator 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. Sub-Administrator shall take all reasonable action in the
performance of its duties under this Agreement to assure that the
necessary information is made available to such accountants for the
expression of their opinion, as required by the Fund.
10. Sub-Administrator System. Sub-Administrator 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 Sub-Administrator in connection with the services
provided by Sub-Administrator to BACAP and the Fund.
11. Disaster Recovery. Sub-Administrator 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, Sub-Administrator shall, at no additional expense
to BACAP, take reasonable steps to minimize service interruptions.
Sub-Administrator shall have no liability with respect to the loss of
data or service interruptions caused by equipment failure, provided such
loss or interruption is not caused by Sub-Administrator'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 Sub-Administrator
during the term of this Agreement, BACAP will pay to Sub-Administrator a
fee or fees as may be agreed to in writing by BACAP and
Sub-Administrator.
13. Indemnification. BACAP agrees to indemnify, defend and hold harmless
Sub-Administrator 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 Sub-Administrator takes in connection with the provision of
services to BACAP and the Fund. Neither Sub-Administrator, nor any of its
affiliates, shall be indemnified against any liability (or any expenses
incident to such liability) caused by Sub-Administrator's or its
affiliates' own willful misfeasance, bad faith, gross negligence or
reckless disregard in the performance of Sub-Administrator's activities
under this Agreement. The provisions of this Section 13 shall survive
termination of this Agreement.
14. Responsibility of Sub-Administrator.
(a) Sub-Administrator shall be under no duty to take any action
hereunder on behalf of BACAP or the Fund except as specifically set
forth herein or as may be specifically agreed to by
Sub-Administrator and BACAP in a written amendment hereto.
Sub-Administrator 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.
Sub-Administrator shall be liable only for any damages arising out
of Sub-Administrator's failure to perform its duties under this
Agreement to the extent such damages arise out of
Sub-Administrator's willful misfeasance, bad faith, gross negligence
or reckless disregard of such duties.
(b) Notwithstanding anything in this Agreement to the contrary, (i)
Sub-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)
Sub-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 accuracy or lack
thereof, of any instruction, direction, notice, instrument or other
information which Sub-Administrator reasonably believes to be
genuine.
(c) Notwithstanding anything in this Agreement (whether contained
anywhere in Sections 15-17 or otherwise) to the contrary, BACAP
hereby acknowledges and agrees that (i) Sub-Administrator, in the
course of providing tax-related services or calculating and
reporting portfolio performance hereunder, may rely upon
Sub-Administrator's interpretation of tax positions or its
interpretation of relevant circumstances (as determined by
Sub-Administrator) in providing such tax services and in determining
methods of calculating portfolio performance to be used, and that
(ii) Sub-Administrator 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 Sub-Administrator's gross
negligence or willful misconduct.
(d) Notwithstanding anything in this Agreement to the contrary, without
limiting anything in the immediately preceding sentence, BACAP
hereby acknowledges and agrees that Sub-Administrator shall not be
liable for any losses or damages of any kind associated with any tax
filings with which Sub-Administrator has assisted in any way except
to the extent such loss or damage is substantially due to
Sub-Administrator's gross negligence or willful misconduct;
provided, however, that Sub-Administrator 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 Sub-Administrator (or similar
service providers) and which, as of the date hereof, have yet to be
identified by such parties as areas for which Sub-Administrator (or
any similar service provider) is (or would be) responsible.
(e) Notwithstanding anything in this Agreement to the contrary, (i)
neither Sub-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
Sub-Administrator or its affiliates and (ii) Sub-Administrator'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
Sub-Administrator 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 Sub-Administrator 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.
Sub-Administrator 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.
Sub-Administrator 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. Sub-Administrator
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 BACAP or by Sub-Administrator on sixty (60) days' prior written notice
to the other party. In the event BACAP 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 Sub-Administrator, will be borne by
BACAP.
19. Reports. Sub-Administrator agrees to prepare such reports as BACAP or the
Fund shall request in order for BACAP and the Fund to monitor and
supervise the services provided under this Agreement.
20. Notices. Notices shall be addressed
(a) if to Sub-Administrator, at [___], Attention: [___];
(b) if to BACAP, at 000 X. Xxxxx Xxxxxx, 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. Assignment. Sub-Administrator may assign its rights and obligations
hereunder to any majority-owned direct or indirect subsidiary of
Sub-Administrator, provided that Sub-Administrator gives BACAP 30 days
prior written notice of such assignment.
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) Except as expressly provided in this Agreement, Sub-Administrator
hereby disclaims all representations and warranties, express or
implied, made to BACAP 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. Sub-Administrator disclaims any
warranty of title or non-infringement except as otherwise set forth
in this Agreement.
(b) 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 Sub-Administrator are not, nor shall they
be, construed as constituting legal advice or the provision of legal
services for or on behalf of BACAP, the Fund or any other person.
(c) 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) 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.
(e) 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: _________________________________
SUB-ADMINISTRATOR
By: ____________________________________
Title: _________________________________
03564.0004 #375591
