INVESTMENT MANAGEMENT AGREEMENT
THIS INVESTMENT MANAGEMENT AGREEMENT is made the 13th day of October,
2006, by and between Old Mutual 2100 Absolute Return Master Fund, L.L.C., a
Delaware limited liability company (the "Fund"), and 0000 Xxxxx Xxxx LLC, a
Delaware limited liability company (the "Investment Adviser").
WHEREAS, the Fund is registered with the Securities and Exchange
Commission (the "Commission") under the Investment Company Act of 1940, as
amended (the "1940 Act"), as a closed-end, non-diversified management investment
company, and the Investment Adviser is an investment adviser registered as such
with the Commission under the Investment Advisers Act of 1940, as amended; and
WHEREAS, the Fund desires to retain the Investment Adviser to act as
its investment adviser pursuant to this Agreement; and
WHEREAS, the Investment Adviser desires to be retained to act as
investment adviser to the Fund pursuant to this Agreement;
NOW, THEREFORE, in consideration of the terms and conditions
hereinafter set forth, it is agreed, by and between the parties, as follows:
1. The Fund hereby retains the Investment Adviser to:
(a) act as its investment adviser and, subject to the supervision
and control of the Board of Managers of the Fund (the "Board"), manage the
investment activities of the Fund as hereinafter set forth. Without limiting the
generality of the foregoing, the Investment Adviser shall: obtain and evaluate
such information and advice relating to the economy, securities markets, and
securities as it deems necessary or useful to discharge its duties hereunder;
continuously manage the assets of the Fund in a manner consistent with the
investment objective, policies and restrictions of the Fund, as set forth in the
registration statement of the Fund filed with the Commission on Form N-2, as the
same may be amended from time to time, and such other policies as may be adopted
from time to time by the Board, and applicable laws and regulations; determine
the securities to be purchased, sold or otherwise disposed of by the Fund and
the timing of such purchases, sales and dispositions; invest discrete portions
of the Fund's assets (which may constitute, in the aggregate, all of the Fund's
assets) in unregistered investment funds or other investment vehicles and
registered investment companies ("Portfolio Funds"), which are managed by
investment managers ("Portfolio Managers"), which retention shall be subject to
compliance with applicable 1940 Act provisions, and take such further action,
including the placing of purchase and sale orders and the voting of securities
on behalf of the Fund, as the Investment Adviser shall deem necessary or
appropriate. The Investment Adviser shall furnish to or place at the disposal of
the Fund such of the information, evaluations, analyses and opinions formulated
or obtained by the Investment Adviser in the discharge of its duties as the Fund
may, from time to time, reasonably request; and
(b) provide, and the Investment Adviser hereby agrees to provide,
certain management services to the Fund in connection with provision of the
advisory services set forth in 1(a) above. These include:
(i) providing office space, telephone and utilities;
(ii) providing administrative and secretarial, clerical
and other personnel as necessary to provide the
services required to be provided under this
Agreement;
(iii) monitoring relations and communications between
investors and the Fund;
(iv) assisting in the drafting and updating of disclosure
documents relating to the Fund and assisting in the
preparation of offering materials;
(v) assisting in the preparation of regulatory filings
with the Commission and state securities regulators
and other Federal and state regulatory authorities;
(vi) assisting in the preparation of reports to and other
informational materials for members and assisting in
the preparation of proxy statements and other member
communications;
(vii) monitoring compliance with regulatory requirements
and with the Fund's investment objective, policies
and restrictions as established by the Board;
(viii) assisting in the preparation of materials and reports
for use in connection with meetings of the Board;
(ix) maintaining and preserving those books and records of
the Fund not maintained by any Sub-Adviser (as
defined in paragraph 2 below) of the Fund or the
Fund's administrator, accounting agent or custodian
(which books and records shall be the property of the
Fund and maintained and preserved as required by the
1940 Act and the rules thereunder and shall be
surrendered to the Fund promptly upon request);
(x) providing the services of persons employed by the
Investment Adviser or its affiliates who may be
appointed as officers of the Fund by the Board; and
(xi) assisting the Fund in routine regulatory
examinations, and working closely with any counsel of
the Fund and any counsel retained to represent any
members of the Board who are not "interested
persons," as defined by the 1940 Act and the rules
thereunder (the
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"Independent Managers") of the Fund in response to
any litigation, investigations or regulatory matters.
2. Provided that the Fund shall not be required to pay any compensation
to the Investment Adviser for the services to be provided hereunder other than
as provided by the terms of this Agreement, the Investment Adviser is
authorized: (i) to obtain investment information, research or assistance from
any other person, firm or corporation to supplement, update or otherwise improve
its investment management services; and (ii) to enter into investment
sub-advisory agreements with any registered investment adviser (a
"Sub-Adviser"), subject to such approvals of the Board and members of the Fund
("Members") as may be required to comply with applicable provisions of the 1940
Act, and delegating any or all of the services required to be provided by the
Investment Adviser under paragraph 1(a) hereof, subject to the supervision of
the Investment Adviser.
3. Without limiting the generality of paragraph 1 hereof, the
Investment Adviser and, if applicable, the Sub-Adviser, shall be authorized to
open, maintain and close accounts in the name and on behalf of the Fund with
brokers and dealers as it determines are appropriate; to select and place orders
with brokers, dealers or other financial intermediaries for the execution,
clearance or settlement of any transactions on behalf of the Fund on such terms
as the Investment Adviser (or the Sub-Adviser) considers appropriate and that
are consistent with the policies of the Fund; and, subject to any policies
adopted by the Board and to the provisions of applicable law, to agree to such
commissions, fees and other charges on behalf of the Fund as it shall deem
reasonable in the circumstances taking into account all such factors as it deems
relevant (including the quality of research and other services made available to
it even if such services are not for the exclusive benefit of the Fund and the
cost of such services does not represent the lowest cost available) and shall be
under no obligation to combine or arrange orders so as to obtain reduced charges
unless otherwise required under the federal securities laws. The Investment
Adviser (or the Sub-Adviser) may, subject to such procedures as may be adopted
by the Board, use affiliates of the Investment Adviser as brokers to effect the
Fund's securities transactions and the Fund may pay such commissions to such
brokers in such amounts as are permissible under applicable law.
4. INVESTMENT MANAGEMENT FEE; EXPENSES
(a) The Fund shall not pay any fees to the Investment Adviser so
long as the Investment Adviser is the investment adviser to any fund that
invests substantially all of its assets in the Fund (each, a "Feeder Fund") and
such Feeder Fund pays a fee to the Investment Adviser for its investment
advisory services. In the event the Investment Adviser ceases to serve as the
investment adviser to each Feeder Fund, as consideration for the provision by
the Investment Adviser of its services hereunder, the Fund shall pay the
Investment Adviser a fee that is calculated and payable in accordance with the
lowest annual rate that had most recently been charged by the Investment Adviser
to a Feeder Fund (the "Investment Management Fee").
(b) Except as is provided in paragraph 6 below, the Investment
Adviser is responsible for all costs and expenses associated with the provision
of its services hereunder including, but not limited to: expenses relating to
the selection and monitoring of Portfolio Managers; and fees of any consultants
or a Sub-Adviser retained by the Investment
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Adviser. The Investment Adviser shall, at its own expense, maintain such staff
and employ or retain such personnel and consult with such other persons as may
be necessary to render the services required to be provided by the Investment
Adviser or furnished to the Fund under this Agreement. Without limiting the
generality of the foregoing, the staff and personnel of the Investment Adviser
shall be deemed to include persons employed or otherwise retained by the
Investment Adviser or made available to the Investment Adviser.
5. The Fund will, from time to time, furnish or otherwise make
available to the Investment Adviser such financial reports, proxy statements,
policies and procedures and other information relating to the business and
affairs of the Fund as the Investment Adviser may reasonably require in order to
discharge its duties and obligations hereunder.
6. Except as provided herein or in another agreement between the Fund
and the Investment Adviser, the Fund shall bear its own operating expenses,
including, but not limited to: all investment-related expenses (including, but
not limited to, fees paid directly or indirectly to Portfolio Managers,
investment-related interest expense, all costs and expenses directly related to
portfolio transactions and positions for the Fund's account such as direct and
indirect expenses associated with the Fund's investments, including its
investments in Portfolio Funds, costs and expenses associated with background
checks on Portfolio Managers, all costs and expenses associated with retaining
independent third parties to provide risk management services to the Fund,
transfer taxes and premiums and taxes withheld on foreign dividends); any
non-investment related interest expense; fees and disbursements of any attorneys
and accountants engaged on behalf of the Fund; entity-level taxes; audit and tax
preparation fees and expenses; administrative expenses and fees; custody and
escrow fees and expenses; the costs of an errors and omissions/directors and
officers liability insurance and a fidelity bond for the Fund; any Investment
Management Fee; fees and travel-related expenses of the Board who are not
employees of the Investment Adviser or any affiliate of the Investment Adviser;
all costs and charges for equipment or services used in communicating
information regarding the Fund's transactions among the Investment Adviser
and/or Sub-Adviser and any custodian or other agent engaged by the Fund; any
extraordinary expenses; and such other expenses as may be approved from time to
time by the Board.
7. The compensation provided to the Investment Adviser pursuant to
paragraph 4 hereof shall be the entire compensation for the services provided to
the Fund hereunder and the expenses assumed by the Investment Adviser under this
Agreement.
8. The Investment Adviser will use its best efforts in the supervision
and management of the investment activities of the Fund and in providing
services hereunder, but in the absence of willful misfeasance, bad faith, gross
negligence or reckless disregard of its obligations hereunder, the Investment
Adviser, its directors, officers or employees and its affiliates, successors or
other legal representatives (collectively, the "Affiliates") shall not be liable
to the Fund for any error of judgment, for any mistake of law, for any act or
omission by the Investment Adviser or any of the Affiliates or by any
Sub-Adviser or for any loss suffered by the Fund.
9. (a) The Fund shall indemnify the Investment Adviser and its
directors, members, officers or employees and their respective affiliates,
executors, heirs, assigns,
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successors or other legal representatives (each an "Indemnified Person") against
any and all costs, losses, claims, damages or liabilities, joint or several,
including, without limitation, reasonable attorneys' fees and disbursements,
resulting in any way from the performance or non-performance of any Indemnified
Person's duties with respect to the Fund, except those resulting from the
willful misfeasance, bad faith or gross negligence of an Indemnified Person or
the Indemnified Person's reckless disregard of such duties, and in the case of
criminal proceedings, unless such Indemnified Person had reasonable cause to
believe its actions were unlawful (collectively, "disabling conduct").
Indemnification shall be made following: (i) a final decision on the merits by a
court or other body before which the proceeding was brought that the Indemnified
Person was not liable by reason of disabling conduct or (ii) a reasonable
determination, based upon a review of the facts and reached by (A) the vote of a
majority of the Managers who are not parties to the proceeding or (B) legal
counsel selected by a vote of a majority of the Board in a written advice, that
the Indemnified Person is entitled to indemnification hereunder. The Fund shall
advance to an Indemnified Person (to the extent that it has available assets and
need not borrow to do so) reasonable attorneys' fees and other costs and
expenses incurred in connection with defense of any action or proceeding arising
out of such performance or non-performance. The Investment Adviser agrees, and
each other Indemnified Person will agree as a condition to any such advance,
that in the event the Indemnified Person receives any such advance, the
Indemnified Person shall reimburse the Fund for such fees, costs and expenses to
the extent that it shall be determined that the Indemnified Person was not
entitled to indemnification under this paragraph 9.
(b) Notwithstanding any of the foregoing to the contrary, the
provisions of this paragraph 9 shall not be construed so as to relieve the
Indemnified Person of, or provide indemnification with respect to, any liability
(including liability under Federal Securities laws, which, under certain
circumstances, impose liability even on persons who act in good faith) to the
extent (but only to the extent) that such liability may not be waived, limited
or modified under applicable law or that such indemnification would be in
violation of applicable law, but shall be construed so as to effectuate the
provisions of this paragraph 9 to the fullest extent permitted by law.
10. Nothing contained in this Agreement shall prevent the Investment
Adviser or any affiliated person of the Investment Adviser from acting as
investment adviser or manager for any other person, firm or corporation and,
except as required by applicable law (including Rule 17j-1 under the 1940 Act),
shall not in any way bind or restrict the Investment Adviser or any such
affiliated person from buying, selling or trading any securities or commodities
for their own accounts or for the account of others for whom they may be acting.
Nothing in this Agreement shall limit or restrict the right of any member,
officer or employee of the Investment Adviser to engage in any other business or
to devote his or her time and attention in part to the management or other
aspects of any other business whether of a similar or dissimilar nature.
11. This Agreement will take effect on the date first set forth above.
Unless earlier terminated pursuant to this paragraph, this Agreement shall
remain in effect for a period of two (2) years from such date and shall continue
in effect from year to year thereafter, so long as such continuance shall be
approved at least annually by the vote of a "majority of the outstanding voting
securities of the Fund," as defined by the 1940 Act and the rules thereunder, or
by the Board; and provided that in either event such continuance is also
approved by a
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majority of the Independent Managers, by vote cast in person at a meeting called
for the purpose of voting on such approval. The Fund may at any time, without
payment of any penalty, terminate this Agreement upon sixty days' prior written
notice to the Investment Adviser, either by majority vote of the Board or by the
vote of a "majority of the outstanding voting securities of the Fund," as
defined by the 1940 Act and the rules thereunder. The Investment Adviser may at
any time, without payment of penalty, terminate this Agreement upon sixty days'
prior written notice to the Fund. This Agreement shall automatically terminate
in the event of its "assignment," as defined by the 1940 Act and the rules
thereunder.
12. Any notice under this Agreement shall be given in writing and shall
be deemed to have been duly given when delivered by hand or facsimile or five
days after mailed by certified mail, post-paid, by return receipt requested to
the other party at the principal office of such party.
13. This Agreement may be amended only by the written agreement of the
parties. Any amendment shall be required to be approved by the Board and by a
majority of the Independent Managers in accordance with the provisions of
Section 15(c) of the 1940 Act and the rules thereunder. If required by the 1940
Act or the rules and interpretations thereunder, any amendment shall also be
required to be approved by the vote of a "majority of the outstanding voting
securities of the Fund," as defined by the 1940 Act and the rules thereunder.
14. This Agreement shall be construed in accordance with the laws of
the State of New York and the applicable provisions of the 1940 Act. To the
extent the applicable law of the State of New York, or any of the provisions
herein, conflict with the applicable provisions of the 1940 Act, the latter
shall control.
15. The Fund represents that this Agreement has been duly approved by
the Board, including the vote of a majority of the Independent Managers, and by
the vote of a "majority of the outstanding voting securities of the Fund," as
defined by the 1940 Act and the rules thereunder.
16. The parties to this Agreement agree that the obligations of the
Fund under this Agreement shall not be binding upon any of the Managers, members
of the Fund or any officers, employees or agents, whether past, present or
future, of the Fund, individually, but are binding only upon the assets and
property of the Fund.
17. This Agreement embodies the entire understanding of the parties.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement on the day and year first above written.
OLD MUTUAL 2100 ABSOLUTE RETURN
MASTER FUND, L.L.C.
By:
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Attest: Name:
Title:
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0000 XXXXX XXXX LLC
By:
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Attest: Name:
Title:
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