Exhibit (k)(4)
FORM OF EXPENSE LIMITATION AGREEMENT
XXXXXXX XXXXX HEDGE FUND PARTNERS REGISTERED FUND, LLC
This EXPENSE LIMITATION AGREEMENT (the "Agreement") is made as of [ ],
2005 by and between Xxxxxxx Sachs Hedge Fund Partners Registered Fund, LLC,
a Delaware limited liability company (the "Fund"), and Xxxxxxx Xxxxx Hedge
Fund Strategies LLC, a Delaware limited liability company ("HFS").
WHEREAS, the Fund is a closed-end management investment company and is
registered as such under the Investment Company Act of 1940, as amended
(the "Investment Company Act"); and
WHEREAS, the Fund and HFS have entered into an investor servicing
agreement dated [ ], 2005 (as it may be amended from time to time, the
"Investor Servicing Agreement"), pursuant to which HFS provides certain
investor services to the Fund for compensation based on the Fund's net
assets as of each month end (the "Investor Servicing Fee").
NOW, THEREFORE, the parties hereto agree as follows:
1. Capitalized terms not defined herein shall have the meaning
ascribed to them in the Limited Liability Company Agreement of the Fund.
2. HFS agrees to pay all of the Fund's organizational expenses as
determined by HFS in accordance with U.S. generally accepted accounting
principles.
3. (a) HFS agrees to waive the Investor Servicing Fee payable to it
pursuant to the Investor Servicing Agreement, or pay an amount to the Fund,
such that the Fund's total expenses, including the Fund's initial offering
expenses and operating expenses, the Investor Servicing Fee and the fees
and expenses of the Fund's administrator, but excluding Extraordinary
Expenses (as defined below) (the "Expenses"), during the 12-month period
beginning on the closing date for the purchase of interests issued by the
Fund in the initial public offering of the Fund (the "Expense Limitation
Period"), do not exceed 0.75% of the average of the net assets of the Fund
(prior to reduction for any Extraordinary Expenses) as of each month-end
during the Expense Limitation Period, as such calculation may be
appropriately adjusted to account for any partial month periods. The amount
of any such waiver or reimbursement will be computed as of the end of each
calendar month during the Expense Limitation Period (subject to appropriate
adjustment to account for any partial month periods or intra-month
subscriptions or repurchases) by subtracting (i) the Expenses that accrued
during such month, from (ii) an amount equal to 1/12th of 0.75% of the net
assets of the Fund as of such month-end (prior to reduction for any
Extraordinary Expenses), with any positive remainder from such calculation
being referred to as a "Month-End Surplus Amount" and any negative
remainder from such calculation being referred to as a "Month-End Deficit
Amount."
(b) In the event that, with respect to any month-end, there is a
Month-End Deficit Amount, promptly following such month-end, HFS shall
rebate and/or reimburse to the Fund a portion of its Investor Servicing Fee
payable as of such month-end, and/or pay to the Fund an amount, equal to
the excess, if any, of (x) such Month-End Deficit Amount, less (y) the then
Cumulative Surplus Amount (as defined below), if any.
(c) In the event that, with respect to any month-end, there is a
Month-End Surplus Amount, promptly following such month-end, the Fund (i)
shall pay to HFS an amount equal to such Month-End Surplus Amount, but only
up to an amount equal to the then Cumulative Deficit Amount (as defined
below), if any, and (ii) shall credit to HFS against any future rebates
and/or reimbursements otherwise payable by HFS under this Agreement the
amount, if any, by which such Month-End Surplus Amount exceeds the
Cumulative Deficit Amount.
The "Cumulative Surplus Amount," immediately prior to any
month-end, equals the excess, if any, of (A) the sum total of all of the
amounts that were previously paid by the Fund to HFS, or credited to HFS,
pursuant to Section (3)(c) of this Agreement as of such time, less (B) the
sum total of all of the amounts that were previously reimbursed and/or
rebated to the Fund by HFS pursuant to Section 3(b) of this Agreement as of
such time. The "Cumulative Deficit Amount," immediately prior to any
month-end, equals the excess, if any, of (A) the sum total of all of the
amounts that were previously reimbursed and/or rebated to the Fund by HFS
pursuant to Section 3(b) of this Agreement as of such time, less (B) the
sum total of all of the amounts that were previously paid by the Fund to
HFS pursuant to Section (3)(c) of this Agreement as of such time.
4. The term "Extraordinary Expenses" shall mean all expenses incurred
by the Fund outside of the ordinary course of its business, including,
without limitation, costs incurred in connection with any claim,
litigation, arbitration, mediation, government investigation or dispute and
the amount of any judgment or settlement paid in connection therewith, or
the enforcement of the Fund's rights against any person or entity; costs
and expenses for indemnification or contribution payable by the Fund to any
person or entity (including, without limitation, pursuant to the
indemnification obligations contained in the Limited Liability Company
Agreement of the Fund, as amended from time to time; expenses of a
reorganization, restructuring or merger of the Fund; expenses of holding,
or soliciting proxies for, a meeting of members of the Fund; and the
expenses of engaging a new administrator, custodian, transfer agent or
escrow agent.
5. HFS may extend the duration of this Agreement for additional
periods, subject to such terms and conditions as may be agreed to by the
parties hereto.
6. This Agreement shall be construed in accordance with the laws of
the State of New York, without giving effect to the conflicts of laws
principles thereof, and the applicable provisions of Federal law. To the
extent that the applicable laws of the State of New York, or any of the
provisions herein, conflict with the applicable provisions of Federal law,
the latter shall control.
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement.
XXXXXXX SACHS HEDGE FUND PARTNERS
REGISTERED FUND, LLC
By:
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Name:
Title:
XXXXXXX XXXXX HEDGE FUND STRATEGIES LLC
By:
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Name:
Title:
