EXHIBIT 10.1
QUIET SYSTEMS LIMITED
ADVISORY AGREEMENT
THIS ADVISORY AGREEMENT ("Agreement") is made and entered into as of the
date set forth in the ACCEPTANCE section on the signature page hereof by and
between Quiet Systems Limited (the "Company"), and Portfolio Boost II, L.P., an
Iowa limited partnership ("Client"). Portfolio Boost, L.L.C., an Iowa limited
liability company serving as the general partner of Client, is also a party
hereto for the limited purposes set forth herein.
WHEREAS, Client desires to retain the Company as Client's trading advisor
with respect to the ACCOUNT (as that term is defined in Section 1 below) upon
the terms and conditions set forth in this Agreement, and the Company desires to
act as trading advisor for Client with respect to the ACCOUNT upon such terms
and conditions.
NOW, THEREFORE, in consideration of the recital set forth above and the
mutual agreements set forth herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Client and the Company hereby agree as follows:
1. Client hereby authorizes the Company to commence trading on Client's
behalf pursuant to this Agreement with the aggregate amount of funds set forth
in Schedule 1 attached hereto as the "Initial Account Size."
Of the amount constituting the Initial Account Size, Client has deposited
or will deposit, as the case may be, the amount of funds (in margin-qualifying
assets) set forth in Schedule 1 attached hereto as the "Actual Funds" in a
trading account (the "ACCOUNT") established with the futures commission merchant
designated in Schedule 2 attached hereto (the "FCM"). Client also has
deposited, or already has on deposit, as the case may be, in other accounts with
the FCM the amount of funds, if any, set forth in Schedule 1 attached hereto as
the "Committed Funds," all of which Committed Funds are available for transfer
to the ACCOUNT in accordance with all applicable conditions evidencing
accessibility and control and all other requirements of the United States
Commodity Futures Trading Commission, the FCM and the Company. Client
acknowledges and agrees that the Committed Funds will be available at all times
for transfer to the ACCOUNT until three (3) business days after the date the
Company has received written notice to the contrary from Client, and Client
authorizes the FCM to transfer funds from the other accounts in which Committed
Funds are deposited to the ACCOUNT as may be directed by the Company from time
to time. Client also authorizes the FCM to provide the Company, upon request by
the Company from time to time, with a written statement indicating the amount of
funds remaining in the other accounts held by the FCM in which Committed Funds
are deposited. The authorizations set forth in this Section 1 shall not in any
way limit, restrict or modify any separate agreement between Client and the FCM
pursuant to which Client has authorized the FCM to transfer funds from and
between Client's accounts with the FCM, including from any other such accounts
to the ACCOUNT. The amount of Committed Funds shall be the amount of funds set
forth as the "Committed Funds" in Schedule 1 attached hereto until three (3)
business days after the date of receipt of written notice by the Company from
Client advising the Company of a reduction or an increase in the amount of the
Committed Funds. Client
acknowledges and agrees that in the event Client lowers the amount of the
Committed Funds, the Company will have the sole discretion to determine when to
close out trades in order to cause the amount of funds being traded by the
Company on Client's behalf pursuant to this Agreement to be within the Nominal
Account Size (as that term is defined below).
The balance of the Initial Account Size [i.e., the amount by which the
Initial Account Size exceeds the sum of the Actual Funds and the Committed
Funds], if any, is the amount of funds set forth in Schedule 1 attached hereto
as the "Notional Funds." If Notional Funds are zero dollars, the sum of the
Actual Funds deposited in the ACCOUNT and the Committed Funds must be equal to
the Initial Account Size. The amount of Notional Funds shall be the amount of
funds set forth as the "Notional Funds" in Schedule 1 attached hereto until
three (3) business days after the date of receipt of written notice by the
Company from Client advising the Company of a reduction or an increase in the
amount of the Notional Funds. Client acknowledges and agrees that in the event
Client lowers the amount of the Notional Funds, the Company will have the sole
discretion to determine when to close out trades in order to cause the amount of
funds being traded by the Company on Client's behalf pursuant to this Agreement
to be within the Nominal Account Size (as that term is defined below). Client
acknowledges that Client has read and understood the risks and other disclosures
regarding the use of Notional Funds as set forth in the Disclosure Document (as
that term is defined in Section 11 below).
The aggregate amount of funds committed by Client for trading pursuant to
this Agreement at any given time shall be an amount equal to the sum of the
following amounts at the particular time in question (the "Nominal Account
Size"): (i) the Actual Funds, increased to reflect profits and additions to the
ACCOUNT and unrealized profits on open positions held in the ACCOUNT, and
decreased to reflect losses and withdrawals from the ACCOUNT and unrealized
losses on open positions held in the ACCOUNT; (ii) the Committed Funds, if any;
and (iii) the Notional Funds, if any.
This Agreement is applicable to, and the Nominal Account Size shall be
traded in, the trading program of the Company designated in Schedule 1 attached
hereto (the "Program").
2. Client hereby constitutes, appoints, and authorizes the Company as
Client's agent and attorney-in-fact to buy, sell (including short sales),
spread, hold, trade in, dispose of, and otherwise enter into, execute and deal
in, on margin or otherwise, domestic and/or foreign futures contracts, futures
options contracts, cash contracts, interbank spot and forward contracts, and any
other domestic or foreign contracts, agreements or other transactions or
commitments in any commodities, currencies, financial instruments, securities,
indices or other interests or items whatsoever traded in the Program from time
to time, and including, without limitation, the right, power and authority to
make or take delivery of an underlying commodity, currency, instrument, security
or other interest or item for and on behalf of Client, all in the Company's sole
discretion.
Client hereby gives and grants to the Company full power and authority to
do every act and thing or to omit to do any act or thing requisite, necessary,
or appropriate, in the Company's sole
2
discretion, to fully effectuate the intent and purposes of this Agreement and
trading on Client's behalf pursuant hereto, all in Client's name, place and
stead and all as fully and in the same manner and with the same force and effect
as Client might or could do if personally present. Without limiting the
generality of any of the foregoing, Client acknowledges and agrees that all
trades may be entered, directed and effectuated by the Company in its sole
discretion and without any approval by and without any prior notification to
Client, and Client directs the FCM to accept, execute and clear all orders for
trades in the ACCOUNT that are entered or otherwise directed by the Company or
any of the Company's agents, employees, contractors or consultants, or by
Frischmeyer Trading Corporation, an Iowa corporation, as Client's agent under
that certain related agreement between Client and Frischmeyer Trading
Corporation (the "FTC Agreement").
Client hereby fully ratifies and confirms any and all orders and
transactions made and actions taken by the Company with respect to the ACCOUNT
or otherwise on behalf of or for the account of Client.
The power and authority and other rights granted to the Company under this
Agreement are in addition and cumulative to, and are not limited or restricted
by or a limitation or restriction on or of, any other powers or authority or
rights granted to the Company in any other agreement, document or instrument,
including, without limitation, any granted pursuant to or in any agreement,
document, or instrument provided by Client at the request of the FCM.
3. All transactions entered, directed or effected by the Company in or for
the ACCOUNT shall be subject to the constitution, by-laws, rules, regulations,
and customs of the exchange or market where executed and its clearinghouse, if
any, and to all applicable laws, rules, and regulations of any applicable
governmental authority.
The Company is hereby authorized to take or to omit to take and shall not
be liable to Client for taking any action or failing to take any action which
the Company, in its sole discretion, deems necessary or appropriate in order to
comply or to avoid noncompliance with any such constitution, by-law, law, rule,
regulation, or custom.
4. Client shall be solely responsible and liable for and shall timely pay
and fulfill all margins, margin calls, options premiums, brokerage and floor
commissions and fees, exchange and National Futures Association fees, and any
and all other fees, costs and expenses charged or incurred by the FCM, Client's
introducing broker, their respective agents, or any other third parties in
connection with any trade or otherwise in connection with the ACCOUNT. The
Company shall have no responsibility or liability whatsoever for any such fees,
costs or expenses.
5. All transactions effected in, for or through the ACCOUNT shall be for
Client's account and at Client's sole risk and expense. The Company makes no
representation, warranty, or guarantee whatsoever as to the success or
profitability of the ACCOUNT or of the Program or the Company's trading methods
or decisions, and Client acknowledges that Client is not entering into this
Agreement
3
in consideration of and has received no such representation, warranty, or
guarantee from the Company or any other person or entity.
6. Notwithstanding anything herein or otherwise which may appear to be to
the contrary, neither the Company nor any of its shareholders, directors,
officers, employees, agents, affiliates, consultants or contractors
(collectively, the "Company Affiliates") shall be in any way liable to Client or
any other person or entity except only for acts or omissions which constitute
willful misconduct or fraud; provided, however, that nothing in this Agreement
is intended or shall be construed as imposing any personal or individual
liability upon any of the Company Affiliates.
Client shall defend, indemnify and hold the Company and each and all of the
Company Affiliates harmless from and against any and all liability, damage,
loss, cost, and/or expense (including, without limitation, arbitration costs and
fees, court costs and reasonable attorneys' fees) in any way arising from or in
connection with or otherwise in any way resulting from any of them acting
pursuant to this Agreement, including, without limitation, with or from (i) any
trade or other transaction made in, for or through the ACCOUNT; (ii) any breach
of warranty, misrepresentation or other nonfulfillment of any agreement on the
part of Client under this Agreement or under any other agreement or document
regarding the ACCOUNT; or (iii) the Company's investigating or defending any
such liability, damage, loss, cost or expense.
7. As compensation for the Company's services, the Company shall receive
(i) a monthly fee (the "Management Fee") of one twelfth of one percent of
Client's Net Assets (as that term is defined below) as of the close of business
on the last business day of each month; and (ii) a quarterly incentive fee (the
"Incentive Fee") of ten percent (10%) of the New Trading Profits (as that term
is defined below) of Client for each quarter, if any; provided, however, that
the amount of fees (whether Management Fees, Incentive Fees, or both) payable to
the Company with respect to any time period shall be reduced and lowered by the
aggregate amount of fees (the "FTC Fees") payable by Client or Portfolio Boost,
L.L.C. to Frischmeyer Trading Corporation under the FTC Agreement with respect
to that time period. The terms "Net Assets" and "New Trading Profits" for this
purpose shall have the meanings given them in the Limited Partnership Agreement
of Client, as the same may be amended from time to time (the "LPA"), and shall
otherwise be calculated and determined in the same manner as provided in the
LPA.
The Management Fee and the Incentive Fee shall be payable to the Company
solely by Portfolio Boost, L.L.C., and Client is not liable or responsible in
any way for the payment of either the Management Fee or the Incentive Fee. The
Management Fee and the Incentive Fee (less the amount of any FTC Fees, as
provided above) shall be payable to the Company by Portfolio Boost, L.L.C. on,
respectively, a monthly and quarterly basis, within ten (10) business days of
the respective dates on which the monthly management fee and the quarterly
incentive fee payable to Portfolio Boost, L.L.C. by Client under the LPA are
paid by Client to Portfolio Boost, L.L.C. from time to time. If this Agreement
is terminated, whether by Client or the Company and for whatever reason, on a
date other than the end of a month (with respect to Management Fees) or quarter
(with respect to Incentive Fees), then such respective fees will be calculated
as if such termination date were the
4
end of a month or quarter, respectively, and Portfolio Boost, L.L.C. shall pay
such fees prorated to such date, notwithstanding the termination of this
Agreement. Portfolio Boost, L.L.C. is a party to this Agreement solely for
purposes of agreeing to pay the Management Fee and the Incentive Fee to the
Company as provided in this Section 7.
8. Client hereby authorizes and directs the FCM to deliver to the Company,
and to Frischmeyer Trading Corporation as Client's agent under the FTC
Agreement, copies of all daily confirmations, daily and monthly activity or
account statements, and all other documents and records relating to the ACCOUNT
as the Company or Frischmeyer Trading Corporation may request or direct from
time to time. Delivery of all such confirmations, statements, documents or other
records may be effected by such methods and procedures as may be established and
agreed to by the Company, Frischmeyer Trading Corporation and the FCM from time
to time, in their sole discretion, including, without limitation, by hand
delivery, fax, e-mail or other computer systems access and/or hookups. Delivery
of all confirmations, statements, documents and records shall be made as soon as
is possible, but Client agrees that if delivery of any daily confirmation or
daily activity or account statement is not made, for whatever reason, at least
one-half hour before the opening of trading on the next day on which at least
one United States exchange is open for trading, Client will not seek to hold and
will not hold the Company or Frischmeyer Trading Corporation liable for any
losses resulting from any errors which may have been disclosed on such daily
confirmation or statement.
9. Client may make partial or total withdrawals from the ACCOUNT three (3)
business days after notifying the Company in writing, subject, however, to any
additional requirements or restrictions as may be established by the FCM from
time to time. Client acknowledges and agrees, however, that if it is necessary
to liquidate or close out any open positions in order to satisfy Client's
withdrawal request, Client will not seek to hold and will not hold the Company
liable for liquidating or closing out any open positions in order to satisfy
Client's withdrawal request, even if, without limitation, the Company would
otherwise not have liquidated or closed out the open positions at that time.
The Company also reserves and shall have the right, but not the obligation, to
liquidate or close out any or all such open positions as the Company deems
appropriate in the event of a partial withdrawal by Client which would reduce
the ACCOUNT balance to a level such that the Company believes, in its sole
discretion, that the ACCOUNT cannot be traded pursuant to the Program. Any
notice of withdrawal by Client shall in no event affect any liabilities in any
way resulting from trades or positions initiated prior or concurrent to the
notice of withdrawal. In the absence of a written withdrawal notice from Client
as provided above, all accumulated profits in the ACCOUNT, if any, will be
retained in the ACCOUNT as part of the Nominal Account Size and for trading in
the Program pursuant to this Agreement. Any withdrawals from the ACCOUNT shall
lower the Nominal Account Size, but shall not lower the amount of the Committed
Funds or the Notional Funds, if any.
Client may make additions to the ACCOUNT from time to time, at which time
or times all of the representations, warranties, acknowledgments and agreements
set forth in this Agreement and in all other agreements or documents regarding
the ACCOUNT will be deemed to be given again and expressly confirmed by Client.
Any additions to the ACCOUNT shall increase the Nominal Account Size, and shall
not lower the amount of the Committed Funds or the Notional Funds, if any.
5
10. This Agreement shall become effective only after it has been duly
signed by Client and has been accepted by the Company pursuant to the Company's
execution of this Agreement in the ACCEPTANCE section below. This Agreement
shall thereafter remain in full force and effect until terminated by either
Client or the Company as provided in this Section 10.
This Agreement may be terminated by Client or Client's legal
representative, as the case may be, at any time, for any reason or no reason, by
giving written notice of termination to the Company, which written notice shall
be deemed effective only upon the Company's actual receipt of such written
notice.
The Company may terminate this Agreement at any time, with or without
cause, for any reason or no reason, effective ten (10) days (three (3) days in
the event of any breach or default of this Agreement by Client) following the
giving of written notice of termination to Client or Client's legal
representative, as the case may be, by the Company. The Company may also
terminate this Agreement effective upon the giving of notice of termination to
Client in the event any transaction is made in the ACCOUNT by any other advisor
or by Client without the prior knowledge and approval of the Company.
Upon the termination of this Agreement, whether by Client or the Company,
and for whatever reason, the control of trading decisions shall revert to
Client, and the Company shall not liquidate or close out any then open trades or
positions or initiate or execute any new trades or positions without the
direction and consent of Client.
The termination of this Agreement shall not effect any trades entered,
directed or effected prior to the effective time and date of termination or any
liability or obligation of the parties hereunder which shall accrue prior to
such termination, including, without limitation, any liability for loss or
damage on account of breach. The termination of this Agreement (by either party
and for whatever reason) shall also not affect the terms or provisions hereof
which contemplate performance by or continuing obligations of Client beyond the
termination hereof, including, without limitation, the obligations of Client
under Section 6 above, all of which shall continue in effect notwithstanding any
termination hereof.
11. Client represents and warrants to the Company that all of the
information set forth in this Agreement and all of the information or
documentation otherwise provided by Client to the Company is true, correct and
complete as of the date hereof, and Client further represents, warrants and
agrees that Client shall immediately advise the Company if there should be any
change in any of such information. Client also represents and warrants to the
Company that (i) this Agreement constitutes the valid and binding agreement of
Client, enforceable in accordance with its terms; (ii) Client has complied and
will continue to comply with all laws, rules, regulations and orders applicable
to this Agreement and all of the transactions contemplated hereby, including,
without limitation, obtaining and maintaining any licenses, registrations,
qualifications and memberships as are necessary under any applicable law, rule,
regulation or order; and (iii) there are no actions, suits, proceedings, or
investigations pending, or to the knowledge of Client, threatened, against
Client or any of its principals or affiliates, before any court, arbitrator,
governmental authority, self-regulatory
6
organization or any securities or commodities exchange, an adverse decision in
which could materially affect Client's ability to comply with and perform its
obligations under this Agreement.
Client also hereby represents and warrants to the Company that Client is
willing and financially able to assume the high risks of trading under the
Program, and that Client is aware of the numerous risks involved in trading
under the Program, including, without limitation, (i) the highly volatile, high
risk and speculative nature of trading in futures and options; (ii) the
possibility that Client's entire investment may be lost and that Clients
liability could greatly exceed the assets in the ACCOUNT; (iii) the fact that
the ACCOUNT will be subject to Management Fees, FTC Fees and substantial
brokerage commissions and other fees and costs regardless of whether profits are
earned; and (iv) that even if the Company instructs the FCM to use its best
efforts to close out some or all of the open positions in the ACCOUNT at a
particular time, there is no assurance that the FCM will be able to close out
such position or positions at that time and/or without incurring substantial
losses. CLIENT ALSO HEREBY ACKNOWLEDGES AND REPRESENTS AND WARRANTS TO THE
COMPANY THAT CLIENT HAS RECEIVED, READ AND UNDERSTOOD THE COMPANY'S DISCLOSURE
DOCUMENT FOR THE COMPANY'S TRADING PROGRAMS (THE "DISCLOSURE DOCUMENT"),
INCLUDING, WITHOUT LIMITATION, ALL OF THE RISK FACTORS, CONFLICTS OF INTEREST
AND DESCRIPTIONS OF FEES SET FORTH IN THE DISCLOSURE DOCUMENT.
If Client is an entity, Client and the individual executing this Agreement
on behalf of Client each represent and warrant to the Company that (i) such
individual is of full legal age in the jurisdiction in which such individual
resides and is legally competent to execute this Agreement; (ii) such individual
has full power and authority to execute this Agreement on behalf of Client and
to make the representations, warranties, acknowledgments and agreements
contained herein for Client and on Client's behalf; (iii) Client has full power
and authority to execute, deliver and perform this Agreement, and the execution,
delivery and performance of this Agreement and all of the transactions
contemplated hereby, including, without limitation, the establishment of the
ACCOUNT and the Nominal Account Size, have been authorized by the governing
board of Client (if required) and do not and will not violate or constitute a
breach or default under the governing documents of Client; and (iv) Client is
duly organized, validly existing and in good standing under the laws of the
jurisdiction under which Client was incorporated or organized.
If Client is an individual, Client represents and warrants to the Company
that Client is of full legal age in the jurisdiction in which Client resides and
is legally competent to execute, deliver and fully perform this Agreement.
All covenants, agreements, acknowledgments, representations and warranties
of Client set forth in this Agreement shall survive the execution and delivery
hereof and remain in full force and effect irrespective of any investigation
made by or on behalf of the Company.
12. Notwithstanding anything herein or otherwise which may appear to be to
the contrary, Client is solely liable for and bears the risk of all errors,
problems and other acts or omissions whatsoever of Client's introducing broker,
the FCM, Frischmeyer Trading Corporation, any exchange
7
or clearinghouse and/or any other third parties, and of all of their affiliates,
principals, agents and employees, including, without limitation, in executing
the Company's instructions or otherwise. Client acknowledges and agrees that,
notwithstanding Section 8 above, the Company has no duty, responsibility or
obligation to supervise or monitor any of such persons or entities. Client also
acknowledges the FCM shall have sole custody of Client's funds, and the sole
responsibility for providing Client with confirmations of trades, daily and
monthly account statements and all other account statements.
13. All notices or communications desired or required to be made or given
hereunder shall be in writing, and shall be sent to, respectively, the addresses
appearing below the Company's and Client's signatures to this Agreement. A
notice is deemed given for purposes of this Agreement upon the hand delivery of
such notice or upon deposit of the notice with an overnight courier service or
in the mail, postage prepaid and sent certified or registered. Either party may
from time to time designate in writing any other address to which notices and
communications to such party may be sent.
14. This Agreement may not be assigned by either party without the prior
express written consent of the other party. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
heirs, successors, legal representatives and permitted assigns. Nothing in this
Agreement, express or implied, is intended to confer upon any party other than
the parties hereto (and their respective heirs, successors, legal
representatives and permitted assigns) any rights, remedies, liabilities or
obligations under or by reason of this Agreement; provided, however, that (i)
the Company Affiliates shall have the protections and rights provided in Section
6 above and Sections 19 and 20 below; and (ii) Frischmeyer Trading Corporation
shall have the rights and protections as provided in Sections 2 and 8 above.
Client acknowledges and agrees that Frischmeyer Trading Corporation has not
agreed and does not agree to perform any of the duties or obligations of the
Company under this Agreement, other than as may be provided in the FTC
Agreement, and that the Company has not agreed and does not agree to perform any
of the duties or obligations of Frischmeyer Trading Corporation under the FTC
Agreement. Client also acknowledges and agrees that a condition to the Company's
obligations under this Agreement is that Client at all times maintain the FTC
Agreement in full force and effect or such other similar agreement with another
person acceptable to the Company, in its sole discretion. In the event another
person is utilized for this purpose in the future, Client agrees to execute an
addendum to this Agreement containing such amendments to this Agreement as the
Company reasonably determines to be necessary.
15. This Agreement, the Disclosure Document, the Exempt Account and
Qualified Eligible Client Representation Agreement given by Client to the
Company, and any arbitration agreement as may be entered into between Client and
the Company or otherwise given by Client to the Company, constitute the entire
agreement between the parties hereto pertaining to the subject matters hereof
and supersede all negotiations, preliminary agreements and all prior or
contemporaneous discussions and understandings of the parties hereto in
connection with the subject matters hereof. All schedules attached to this
Agreement are incorporated into this Agreement by this reference as if set forth
in full, and constitute a part hereof.
8
16. No amendment, modification, supplement, termination or waiver of or to
any provision of this Agreement, nor consent to any departure therefrom, shall
be implied from any course of dealing between the parties or from the failure of
a party to assert its rights under this Agreement on any occasion or series of
occasions or shall otherwise be effective unless the same shall be in writing
and signed by or on behalf of the party to be charged with the enforcement
thereof. Any amendment, modification or supplement of or to any provision of
this Agreement, any waiver of any provision of this Agreement, and any consent
to any departure from the terms of any provision of this Agreement, shall be
effective only in the specific instance and for the specific purpose for which
made or given. No failure or delay on the part of any party in exercising any
right, power or remedy hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right, power or remedy preclude any
other or further exercise thereof or the exercise of any other right, power or
remedy.
17. In the event any provision of this Agreement is held invalid, illegal
or unenforceable, in whole or in part, the remaining provisions of this
Agreement shall not be affected thereby and shall continue to be valid and
enforceable. In the event any provision of this Agreement is held to be invalid,
illegal or unenforceable as written, but valid, legal and enforceable if
modified, then such provision shall be deemed to be amended to such extent as
shall be necessary for such provision to be valid, legal and enforceable and it
shall be enforced to that extent. Any finding of invalidity, illegality or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
18. This Agreement shall be deemed to have been made in, and shall be
governed by and construed and enforced in accordance with the laws of the Cayman
Islands, British West Indies, but without regard to provisions thereof relating
to conflicts of law or which otherwise require the application of or reference
to the law of any other jurisdiction.
19. Client and the Company agree that any claim, counterclaim, grievance,
demand, dispute, action, proceeding or other controversy in any way arising from
or out of, in connection with, or otherwise relating to the ACCOUNT, any trade
or other transaction regarding the ACCOUNT, or otherwise from or out of, with
or to any of the Company's agreements with (including this Agreement and the
agreements and documents referred to in Section 15 above), services to or for or
the Company's relationship with Client (a "Claim") shall be resolved on Grand
Cayman in the Cayman Islands, British West Indies, whether such resolution is
through arbitration, the courts or otherwise. Accordingly, Client and the
Company hereby irrevocably and unconditionally agree that any arbitration
proceedings between Client and the Company with respect to any Claim shall be
held on Grand Cayman, and to the extent that arbitration is not pursued or is
otherwise not available with respect to any Claim and Client or the Company
desire to pursue such Claim in the courts or otherwise, Client and the Company
hereby irrevocably and unconditionally consent and submit to the exclusive
jurisdiction of the courts or other applicable authorities located on Grand
Cayman with respect to such Claim. Actions to enforce orders or judgments
(whether obtained through arbitration, the courts or otherwise) may, however, be
brought in any appropriate jurisdiction. Client and the Company irrevocably
consent to the service of any and all process with
9
respect to any Claim by the delivery of copies of such process to them at their
respective address specified for notices to be given hereunder or by certified
mail direct to such address. EACH OF THE PARTIES HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT TO A JURY TRIAL WITH RESPECT TO ANY CLAIM. ANY
ACTION OR PROCEEDING (WHETHER IN ARBITRATION, IN THE COURTS OR OTHERWISE) WITH
RESPECT TO ANY CLAIM MUST BE COMMENCED WITHIN ONE (1) YEAR AFTER THE DATE THE
CLAIM AROSE OR ACCRUES OR THE CLAIM SHALL BE LOST AND FOREVER BARRED. A "Claim"
for purposes of this Section 19 shall include a Claim between Client and the
Company and between or among Client and any one or more of the Company or the
Company Affiliates.
20. Notwithstanding anything contained in this Agreement or otherwise
which may appear to be to the contrary, and in addition to the limitation on the
liability of the Company and the Company Affiliates set forth in Section 6
above, if any term or condition of this Agreement to be performed or observed by
the Company or any act or omission of the Company to be taken pursuant to this
Agreement is in any way restricted, affected or rendered impossible of
performance or observance due to any act of God or any force majeure (including,
without limitation, flood, storm, weather, war, civil disturbance, fire or
casualty), or any communication line failure, computer failure, power failure,
mechanical failure, equipment malfunction or failure, computer virus, software
error or interruption, labor dispute, governmental rule, act or omission of any
third party, or any other factor beyond the reasonable control of the Company,
the Company shall, for so long as any such condition exists, be excused from
such performance or observance. Neither the Company nor any Company Affiliate
shall have any liability whatsoever to Client for any losses, damages, costs or
expenses in any way incurred by Client in any such circumstance or due to the
Company's failure or partial failure to perform in any such circumstance.
21. Client acknowledges that, as provided in the Disclosure Document, the
Company may execute trades through such futures commission merchants or floor
brokers as the Company may select from time to time, with instructions to "give
up" such trades to the FCM for clearing. Client agrees to pay all "give up"
fees in this circumstance as provided in the Disclosure Document. Client agrees
to execute and deliver a separate authorization to the Company, such futures
commission merchants and floor brokers as are selected by the Company and the
FCM regarding the matters addressed in this Section 21 promptly following any
request therefor by the Company.
22. This Agreement may be executed by one or more of the parties to this
Agreement on any number of separate counterparts (including by facsimile
transmission), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument, and in making proof hereof it shall not
be necessary to produce or account for more than one such counterpart.
23. This Agreement shall not be construed more strongly against any party
regardless of who is more responsible for its preparation.
10
24. Words and phrases herein shall be construed as in the singular or
plural number and as masculine, feminine or neuter gender, according to the
context.
25. If more than one person is signing this Agreement as Client, each
representation, warranty, agreement or other undertaking herein is and shall be
a joint and several representation, warranty, agreement or undertaking of each
of such persons, and the foregoing grants of powers, authorities and rights to
the Company are and shall be a joint and several grant by each of such persons.
Actions of any one Client pursuant to this Agreement shall conclusively bind all
such Clients. Unless otherwise specifically stated, an ACCOUNT in joint names
creates a joint tenancy with full rights of survivorship, and not a tenancy in
common.
26. Nothing contained in this Agreement and no action taken or omitted to
be taken by the parties pursuant hereto shall be deemed to constitute the
parties a partnership, an association, a joint venture or other entity
whatsoever.
27. Client hereby authorizes the Company to provide to the FCM a copy of
this Agreement or copies of such sections and provisions from this Agreement as
the Company may from time to time determine. The FCM is hereby authorized and
directed by Client to fully act in accordance with and rely upon all of the
authorizations and directions given to the FCM under this Agreement, without
notice to or further verification or authorization from Client.
28. PURSUANT TO AN EXEMPTION FROM THE COMMODITY FUTURES TRADING COMMISSION
IN CONNECTION WITH ACCOUNTS OF QUALIFIED ELIGIBLE CLIENTS, THIS ACCOUNT DOCUMENT
IS NOT REQUIRED TO BE, AND HAS NOT BEEN, FILED WITH THE COMMISSION. THE
COMMODITY FUTURES TRADING COMMISSION DOES NOT PASS UPON THE MERITS OF
PARTICIPATING IN A TRADING PROGRAM OR UPON THE ADEQUACY OR ACCURACY OF COMMODITY
TRADING ADVISOR DISCLOSURE. CONSEQUENTLY, THE COMMODITY FUTURES TRADING
COMMISSION HAS NOT REVIEWED OR APPROVED THE COMPANY'S TRADING PROGRAMS OR THIS
ACCOUNT DOCUMENT.
IN WITNESS WHEREOF, Client has executed this Agreement as of the 27th day
of August, 1998.
CLIENT
PORTFOLIO BOOST II, L.P. PORTFOLIO BOOST, L.L.C., solely
By: Portfolio Boost, L.L.C., for purposes of Section 7 above
General Partner
By: /s/Xxxxxxx X. Xxxx
--------------------------
Xxxxxxx X. Xxxx, President By: /s/Xxxxxxx X. Xxxx
--------------------------
Xxxxxxx X. Xxxx, President
Cornerstone at Cantera
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxx 00000
11
____________________________________
Client's address
1-877-RRRATIO
____________________________________
Client's phone number
000-000-0000
______________________________
Client's Fax Number
ACCEPTANCE
This Agreement is hereby accepted by Quiet Systems Limited as of the 27th
day of August, 1998.
QUIET SYSTEMS LIMITED
By: /s/Xxxx Xxx X'Xxxxx, President
-----------------------------------
Title
British American Centre, Phase 3
Xx. Xxx'x Drive
Xxxxxx Town, Grand Cayman
Cayman Islands
12
SCHEDULE 1
This Schedule 1 is a part of that certain Advisory Agreement by and between
the undersigned and Quiet Systems Limited, which is of even date herewith and to
which this Schedule 1 is attached (the "Agreement"). Capitalized terms utilized
in this Schedule 1 which are not otherwise defined in this Schedule 1 shall have
the meanings given to them in the Agreement.
The Initial Account Size, Actual Funds, Committed Funds and Notional Funds
for purposes of the Agreement are as follows:
$500,000 - Initial Account Size $ -0- - Committed Funds
$500,000 - Actual Funds $ -0- - Notional Funds
All of the above amounts are set forth in United States dollars.
This Agreement is applicable to the following specified Program (please
check or place initials in the line beside the applicable Program):
____ - FOREX INDEX Program ____ - Diversified Program
X - Financial Program
----
PORTFOLIO BOOST II, L.P.
By: Portfolio Boost, L.L.C., General Partner
By: /s/Xxxxxxx X. Xxxx
----------------------------------------
Xxxxxxx X. Xxxx, President
Date: August 27, 1998
13
SCHEDULE 2
This Schedule 2 is a part of that certain Advisory Agreement by and between
the undersigned and Quiet Systems Limited, which is of even date herewith and to
which this Schedule 2 is attached (the "Agreement"). Capitalized terms utilized
in this Schedule 2 which are not otherwise defined in this Schedule 2 shall have
the meanings given to them in the Agreement.
The FCM for purposes of the Agreement is as follows:
LBS Division of
First Options of Chicago, Inc. Xxxx Xxxxxxxxx, Vice President
------------------------------- --------------------------------
Name of FCM Name and Title of Individual
Contact at FCM
0000 X. Xxxxxxx 000-000-0000
-------------------------------------------------------------------------
Suite 1904 FCM's Phone Number
-------------------------------
Xxxxxxx, Xxxxxxxx 00000
-------------------------------
FCM's Address 000-000-0000
--------------------------------
FCM's Fax Number
PORTFOLIO BOOST II, L.P.
By: Portfolio Boost, L.L.C.,
General Partner
By: /s/Xxxxxxx X. Xxxx
----------------------------
Xxxxxxx X. Xxxx, President
Date: August 27, 1998
14
