EXHIBIT C
REPRESENTATION AGREEMENT CONCERNING THE
REGISTRATION STATEMENT AND THE PROSPECTUS
REPRESENTATION AGREEMENT ("Agreement") dated as of
the ___ day of _________, 1999, by and among World Monitor
Trust II (the "Trust"), a business trust organized under Chapter
38 of Title 12 of the Delaware Code (the "Delaware Act"),
Prudential Securities Incorporated, a Delaware corporation
("Prudential Securities"), Prudential Securities Futures
Management Inc., a Delaware corporation (the "Managing
Owner"), Wilmington Trust Company, a Delaware corporation
(the "Trustee") and Beacon Management Corporation (USA), a
Delaware corporation (the "Advisor").
W I T N E S S E T H:
WHEREAS, the Trust proposes to make an initial public
offering (the "Offering") of limited liability interests in the
Trust (the "Interests") issuable in multiple series (the
"Series"), each separately managed by a different professional
commodity trading advisor through Prudential Securities
Incorporated ("Prudential Securities"), an affiliate of the
Managing Owner, and in connection therewith, the Trust
intends to file with the U.S. Securities and Exchange
Commission (the "SEC"), pursuant to the U.S. Securities Act
of 1933, as amended (the "1933 Act"), a registration statement
on Form S-1 to register the Interests in Series F, and as a part
thereof a prospectus (which registration statement, together
with all amendments thereto, shall be referred to herein as the
"Registration Statement" and which prospectus in final form,
together with all amendments and supplements thereto, shall
be referred to herein as the "Prospectus"); and
WHEREAS, the Trust and the Managing Owner entered into an
agreement with the Advisor, dated as of ________________,
1999 (the "Advisory Agreement"), pursuant to which the
Advisor has agreed to act as a commodity trading advisor to
the Trust with respect to the portion of the Trust Estate
represented by Series F Interests; and
WHEREAS, the parties hereto wish to set forth their duties and
obligations to each other with respect to the Registration
Statement as of its effective date and the Prospectus as of the
date(s) on which subscribers' funds are transferred to the
portion of the Trust Estate represented by Series F Interests
("Closing Dates(s)").
NOW, THEREFORE, the parties agree as follows:
1. Representations and Warranties of the Advisor. The
Advisor hereby represents and warrants to Prudential
Securities, the Trust, the Trustee and the Managing Owner
that:
a. All references in the Registration Statement, consented
to in writing by the Advisor in the form attached hereto as
Exhibit A, as of its effective date and the Prospectus as of the
Closing Date to (i) the Advisor and its affiliates, and the
controlling persons, shareholders, directors, officers and
employees of any of the foregoing, (ii) the Advisor's Trading
Approach (as defined in the Advisory Agreement) and (iii) the
actual past performance of discretionary accounts directed by
the Advisor or any principal thereof, including the notes to the
tables reflecting such actual past performance (hereinafter
referred to as the Advisor's "Past Performance History") are
complete and accurate in all material respects, and as to such
persons, the Advisor's Trading Approach and the Advisor's
Past
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Performance History, the Registration Statement as of its
effective date and the Prospectus as of each Closing Date
contain all information required to be included therein by the
Commodity Exchange Act, as amended (the "CE Act"), and the
regulations (including interpretations thereof) thereunder, and
do not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary
to make the statements therein (with respect to the
Prospectus, in light of the circumstances in which they were
made) not misleading. The Advisor also represents and
warrants as to the accuracy and completeness in all material
respects of the underlying data made available by the Advisor
to the Trust and the Managing Owner for purposes of
preparing the pro forma performance tables, it being
understood that no representation or warranty is being made
with respect to the pro forma performance tables or notes
thereto. The term "principal" in this Agreement shall have the
same meaning as that term in Commodity Futures Trading
Commission (the "CFTC") Regulation S 4.10(e) under the CE
Act.
b. The Advisor will not distribute the Registration
Statement, the Prospectus and/or the selling materials related
thereto, except as may be requested by the Managing Owner
in connection with "road show" presentations or otherwise.
c. This Agreement and the Advisory Agreement have been
duly and validly authorized, executed and delivered on behalf
of the Advisor and each is a valid and binding agreement
enforceable in accordance with its terms. The performance of
the Advisor's obligations under this Agreement and the
consummation of the transactions set forth in this Agreement,
in the Advisory
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Agreement and in the Registration Statement
as of its effective date and Prospectus as of the Closing Date
are not contrary to the provisions of the Advisor's formation
documents, or to the best of its knowledge, any applicable
statute, law or regulation of any jurisdiction, and will not result
in any violation, breach or default under any term or provision
of any undertaking, contract, agreement or order to which the
Advisor is a party or by which the Advisor is bound.
d. The Advisor has all governmental and regulatory
licenses, registrations and approvals required by law as may
be necessary to perform its obligations under the Advisory
Agreement and this Agreement and to act as described in the
Registration Statement as of its effective date and the
Prospectus as of the Closing Date including, without
limitation, registration as a commodity trading advisor under
the CE Act and membership as a commodity trading advisor
with the National Futures Association (the "NFA"), and it will
maintain and renew any required licenses, registrations,
approvals or memberships during the term of the Advisory
Agreement.
e. On the date hereof, the Advisor is, and at all times during
the term of this Agreement will be, a corporation duly formed
and validly existing and in good standing under the laws of its
jurisdiction of incorporation and in good standing and
qualified to do business in each jurisdiction in which the
nature or conduct of its business requires such qualifications
and the failure to be so qualified would materially adversely
affect the Advisor's ability to perform its obligations hereunder
or under the Advisory Agreement. The Advisor has full
capacity and
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authority to conduct its business and to perform
its obligations under this Agreement and to act as described
in the Registration Statement as of its effective date and the
Prospectus as of the Closing Date.
f. Subject to adequate assurances of confidentiality, and as
requested of the Managing Owner, the Advisor has supplied to
or made available for review by the Managing Owner and
Prudential Securities (and if requested by the Managing Owner
and Prudential Securities to its designated auditor) all
documents, statements, agreements and workpapers
requested by them relating to all accounts covered by the
Advisor's Past Performance History in the Registration
Statement as of its effective date and the Prospectus as of the
Closing Date which are in the Advisor's possession or to
which it has access; provided, however, that the Advisor may,
in its sole discretion withhold from any such inspection the
identity of the clients for whom any such accounts are
maintained.
g. Without limiting the generality of paragraph a. of this
Section 1, neither the Advisor nor any of its principals has
managed, controlled or directed, on an overall discretionary
basis, the trading for any commodity account which is
required by CFTC regulations and the rules and regulations
under the 1933 Act to be disclosed in the Registration
Statement as of its effective date and the Prospectus as of the
Closing Date which is not set forth in the Registration
Statement as of its effective date and in the Prospectus as of
the Closing Date as required.
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h. The Advisor does not provide any services to any
persons or conduct any business involving advice with
respect to investments other than Commodities (as defined in
the Advisory Agreement), except as has been disclosed in
writing to the Managing Owner. The Advisor is not required to
be registered as an investment adviser under the Investment
Advisers Act of 1940, as amended (the "Advisers Act"), but
voluntarily may so register in the future.
i. As of the date hereof, there has been no material adverse
change in the Advisor's Past Performance History as set forth
in the Registration Statement or in the Prospectus under the
caption "SERIES F Past Performance For All Of Its Clients"
which has not been communicated in writing to and received
by the Managing Owner and Prudential Securities or their
counsel.
j. Except for subsequent performance, as to which no
representation is made, since the date of the Advisory
Agreement, (i) there has not been any material adverse change
in the condition, financial or otherwise, of the Advisor or in the
earnings, affairs or business prospects of the Advisor,
whether or not arising in the ordinary course of business, and
(ii) there have not been any material transactions entered into
by the Advisor other than those in the ordinary course of its
business, except for the intended sale by the Advisor of its
interests in Mt. ▇▇▇▇▇ Corporation (USA) ("Mt. ▇▇▇▇▇
Transaction").
k. The Mt. ▇▇▇▇▇ Transaction will have no material affect on
the Advisor's ability to (i) continue it operations as it has in the
past and provide the services required by this Agreement, or
(ii) research, operate and implement its trading
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strategy, as defined in the Advisory Agreement dated as of
______________-, 1999 between the Trust, the Managing
Owner, and the Advisor (the "Trading Strategy"), nor will the
Mt. ▇▇▇▇▇ Transaction result in the loss of any significant
employees or access to significant resources that will or could
have a detrimental effect on the Advisor's trading performance
and continue development of its Trading Strategy.
l. Except as disclosed in the Registration Statement and in
the Prospectus, there is no pending, or to the best of its
knowledge, threatened or contemplated action, suit or
proceeding before or by any court, governmental,
administrative or self-regulatory body or arbitration panel to
which the Advisor or its principals is a party, or to which any
of the assets of the Advisor is subject which reasonably might
be expected to result in any material adverse change in the
condition (financial or otherwise), business or prospects of
the Advisor or which reasonably might be expected to
materially adversely affect any of the material assets of the
Advisor or which reasonably might be expected to (A) impair
materially the Advisor's ability to discharge its obligations to
the Trust or (B) result in a matter which would require
disclosure in the Registration Statement and/or Prospectus;
furthermore the Advisor has not received any notice of an
investigation by the NFA regarding non-compliance with its
rules or the CE Act, the CFTC regarding non-compliance with
the CE Act, or the rules and regulations thereunder or any
exchange regarding non-compliance with the rules of such
exchange which investigation reasonably might be expected
to materially impair the Advisor's
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ability to discharge its obligations under this Agreement
or the Advisory Agreement.
2. Covenants of the Advisor. If, at any time during the term
of the Advisory Agreement, the Advisor discovers any fact,
omission or event, or that a change of circumstances has
occurred, which would make the Advisor's representations
and warranties in Section 1 of this Agreement inaccurate or
incomplete in any material respect, or which might reasonably
be expected to render the Registration Statement or
Prospectus, with respect to (i) the Advisor or its principals, (ii)
the Advisor's Trading Approach or (iii) the Advisor's Past
Performance History, untrue or misleading in any material
respect, the Advisor will provide prompt written notification to
the Trust, the Managing Owner and Prudential Securities of
any such fact, omission, event or change of circumstance, and
the facts related thereto, and it is agreed that the failure to
provide such notification or the failure to continue to be in
compliance with the foregoing representations and warranties
during the term of the Advisory Agreement as soon as
possible following such notification shall be cause for the
Trust and the Managing Owner to terminate the Advisory
Agreement with the Advisor on prior written notice to the
Advisor. The Advisor also agrees that, during the term of the
Advisory Agreement, from and after the Effective Date of the
Registration Statement and for so long as Interests in the
Trust are being offered, whether during the Initial Offering
Period or during the Continuous Offering Period (as those
terms are described in the Prospectus), it will provide
Prudential Securities, the Trust and the Managing Owner with
updated month-end information relating to the Advisor's Past
Performance History, as required to be disclosed in the
performance tables relating to the performance of the Advisor
in the Prospectus under the caption "SERIES F -- Past
Performance For All Of Its Clients" beyond the periods
disclosed therein. The Advisor shall use its best
8
efforts to provide such information within a reasonable period of time
after the end of the month to which such updated information
relates and the information is available to it.
3. Modification of Registration Statement or Prospectus. If
any event or circumstance occurs as a result of which it
becomes necessary, in the judgment of the Managing Owner
and Prudential Securities, to amend the Registration
Statement in order to make the Registration Statement not
materially misleading or to amend or to supplement the
Prospectus in order to make the Prospectus not materially
misleading in light of the circumstances existing at the time it
is delivered to a subscriber, or if it is otherwise necessary in
order to permit the Trust to continue to offer its Interests
subsequent to the Initial Offering Period subject to the
limitations set forth in the Advisory Agreement, the Advisor
will furnish such information with respect to itself and its
principals, as well as its Trading Approach and Past
Performance History as the Managing Owner or Prudential
Securities may reasonably request, and will cooperate to the
extent reasonably necessary in the preparation of any required
amendments or supplements to the Registration Statement
and/or the Prospectus.
4. Advisor's Closing Obligations. On or prior to the Closing
Date with respect to the initial offering of Series F Interests
(the "Initial Closing Date"), and thereafter, only if requested,
on or prior to each closing date during the continuous offering
of Series F Interests (each a "Subsequent Closing Date"), the
Advisor shall deliver or cause to be delivered, at the expense
of the Advisor, to Prudential Securities, the Trust and the
Managing Owner, the reports, certificates, documents and
opinions described below addressed to them and, except as
may be set forth below, dated the Initial Closing Date or the
Subsequent Closing Date, as appropriate (provided that the
Advisor shall not be obligated to provide an opinion of its
counsel more frequently than once per annum absent good
cause shown). Unless the context otherwise
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requires, the Initial Closing Date and each Subsequent Closing
Date shall each be referred to as a "Closing Date."
a. A report from the Advisor which shall present, for the
period from the date after the last day covered by the
Advisor's Past Performance History as set forth under
"SERIES F -- Past Performance For All Of Its Clients" in the
Prospectus to the latest practicable month-end before the
Closing Date, figures which shall show the actual past
performance of the Advisor (or, if such actual past
performance information is unavailable, then the estimated
past performance) for such period, and which shall certify that,
to the best of the Advisor's knowledge, such figures are
complete and accurate in all material respects.
b. A certificate of the Advisor in the form proposed prior to
the Closing Date by counsel to Prudential Securities, the Trust
and the Managing Owner, with such changes in such form as
are proposed by the Advisor or its counsel and as are
acceptable to Prudential Securities, the Trust and the
Managing Owner and their counsel so as to make such form
mutually acceptable to Prudential Securities, the Trust, the
Managing Owner, the Advisor and their respective counsel, to
the effect that:
(i) The representations and warranties of the
Advisor in Section 1 of this Agreement are true and correct in
all material respects on the date of the certificate as though
made on such date.
(ii) Nothing has come to the Advisor's attention
which would cause the Advisor to believe that, at any time
from the time the
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Registration Statement initially became
effective to the Closing Date, the Registration Statement, as
amended from time to time, or the Prospectus, as amended or
supplemented from time to time, with respect to the Advisor,
or its affiliates, and controlling persons, shareholders,
directors, officers or employees of any of the foregoing, or
with respect to the Advisor's Trading Approach or Past
Performance History, contained an untrue statement of a
material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein
(with respect to the Prospectus, in light of the circumstances
in which they were made) not misleading.
(iii) The Advisor has performed all covenants and
agreements herein contained to be performed on its part at or
prior to the Closing Date.
c. A certificate of the Advisor (together with such
supporting documents as are set forth in such certificate), in
the form proposed prior to the Closing Date by counsel to
Prudential Securities, the Trust and the Managing Owner, with
such changes in such form as are proposed by the Advisor or
its counsel and are acceptable to Prudential Securities, the
Trust and the Managing Owner and their counsel so as to
make such form mutually acceptable to Prudential Securities,
the Trust, the Managing Owner, the Advisor and their
respective counsel, with respect to, (i) the continued
effectiveness of the organizational documents of the Advisor,
(ii) the continued effectiveness of the Advisor's registration as
a commodity
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trading advisor under the CE Act and
membership as a commodity trading advisor with the NFA and
(iii) the incumbency and genuine signature of the President
and Secretary of the Advisor.
d. A certificate from the state of formation of the Advisor, to
be dated at, on or around the Closing Date, as to its formation
and good standing.
e. An opinion of counsel, in form and substance
satisfactory to the Trust, the Managing Owner and Prudential
Securities and their counsel, dated the Closing Date, to the
following effect:
(i) The Advisor is a duly formed and validly
existing corporation in good standing under the laws of the
state of its formation and, if different, the state where it
conducts its primary business activity, and the Advisor has
full corporate power and authority under its Certificate of
Incorporation to perform its obligations under the Advisory
Agreement and under this Agreement and to act as described
in the Registration Statement as of its effective date and in the
Prospectus as of the Closing Date.
(ii) Each of the Advisory Agreement and this
Agreement have been duly and validly authorized, executed
and delivered on behalf of the Advisor, and assuming the due
execution and delivery of each such Agreement by the Trust,
Prudential Securities, the trustee and the Managing Owner, as
applicable, each such agreement constitutes the legal, valid
and binding obligations of the Advisor, enforceable in
accordance with their respective terms, except as the same
may be limited by
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bankruptcy, insolvency, reorganization,
moratorium or similar laws at the time in effect affecting
creditors rights generally, or by applicable principles of equity,
whether in an action at law or in equity, and except that the
enforceability of the indemnification, exculpation, and
severability provisions may be limited under applicable federal
or state securities, commodities and other laws or by public
policy; and the execution and delivery of such agreements and
the incurrence of the obligations thereunder and the
consummation of the transactions set forth in such
agreements and in the Prospectus will not violate or result in a
breach of the Advisor's formation documents, and, to the best
of such counsel's knowledge, after due inquiry, will not result
in any violation, breach or default under any term or provision
of any undertaking, contract, agreement or order to which the
Advisor is a party or by which the Advisor is bound.
(iii) Subject to subparagraph (iv) of this Section 4.e, to the
best of such counsel's knowledge, after due inquiry, the
Advisor has obtained all required governmental and regulatory
licenses, registrations and approvals required by law as may
be necessary in order to perform its obligations under the
Advisory Agreement and under this Agreement and to act as
described in the Registration Statement as of its effective date
and the Prospectus as of the Closing Date (including, without
limitation, registration as a commodity trading advisor under
the CE Act and
13
membership as a commodity trading advisor
with the NFA), and such licenses, registrations and approvals
have not, to the best of such counsel's knowledge, after due
inquiry, been rescinded, revoked or otherwise removed.
(iv) Assuming that the Trust is operated as
described in the Prospectus, the Advisor is not required to be
licensed or registered as an investment adviser under the
Advisers Act (even if it voluntarily is so registered), or to such
counsel's knowledge, without independent investigation, as
an investment adviser or commodity trading advisor under the
laws of any state of the U.S., in order to perform its obligations
under the Advisory Agreement or under this Agreement, or to
act as described in the Registration Statement as of its
effective date and the Prospectus as of the Closing Date. The
foregoing opinion may be qualified by the fact that such
counsel is not admitted to practice law in all jurisdictions, and
by the fact that in rendering its opinion such counsel has
relied solely upon an examination of the Blue Sky securities
laws and related rules, regulations, and administrative
determinations, if any, promulgated thereunder, of the various
jurisdictions as reported in customarily relied upon standard
compilations, and upon such counsel's understanding of the
various conclusions expressed, formally or informally, by
administrative officials or other employees of the various
regulatory or other governmental agencies or authorities
concerned.
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(v) To such counsel's knowledge without
independent investigation, except as described in the
Prospectus or in a schedule delivered by counsel to Prudential
Securities and the Managing Owner prior to the date hereof,
there is no pending or threatened suit or proceeding, known to
such counsel, before or by any court, governmental or
regulatory body or arbitration panel to which the Advisor or
any of the assets of the Advisor or any of its principals is
subject and which reasonably might be expected to result in
any material adverse change in the condition (financial or
otherwise), business or prospects of the Advisor or any of its
principals or which reasonably might be expected materially
adversely to affect any of the assets of the Advisor or any of
its principals or which reasonably might be expected to (A)
impair materially the Advisor's ability to discharge its
obligations to the Trust or (B) result in a matter which would
require disclosure in the Registration Statement or
Prospectus; and, to the best of such counsel's knowledge,
neither the Advisor nor any of its principals has received any
notice of an investigation by (i) the NFA regarding non-
compliance with its rules or the CE Act, (ii) the CFTC regarding
non-compliance with the CE Act or (iii) any exchange,
regarding non-compliance with its rules, which investigation
reasonably might be expected to (A) impair materially the
Advisor's ability to discharge its obligations to the Trust or (B)
result in a matter which would require disclosure in the
Registration Statement or Prospectus.
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(vi) With respect to the Advisor and its
affiliates, and controlling persons, shareholders, directors,
officers and employees of any of the foregoing, and with
respect to the Advisor's Trading Approach, nothing has come
to the attention of such counsel that leads such counsel to
believe that the Registration Statement (at the time it initially
became effective and at the time any post-effective
amendment thereto became effective) or the Prospectus
contains any untrue statement of a material fact or omits to
state a material fact required to be stated therein or which is
necessary to make the statements therein (with respect to the
Prospectus, in light of the circumstances in which they are
made) not misleading, except that such counsel is not
required to express any opinion or belief as to the financial
statements or other financial or statistical data, past
performance tables, notes, or descriptions thereto or other
past performance information contained in the Registration
Statement or the Prospectus.
In rendering the foregoing opinions, such counsel may rely (i)
as to matters of fact, on a certificate of an officer of the
Advisor, unless such counsel has actual knowledge otherwise,
and (ii) as to matters of law of states other than that in which
they are licensed to practice law, upon the opinions of other
counsel, in each case satisfactory in form and substance to
counsel to the Managing Owner and Prudential Securities, and
such counsel shall state that they believe the Managing Owner
and Prudential Securities may rely on them.
5. Advisor Acknowledgements. The Advisor acknowledges
that: (i) it may be a condition to each closing under the
Underwriting Agreement that Prudential Securities shall
16
have received, at no cost to the Advisor, letter(s) from certified
public accountants or other reputable professionals selected
by Prudential Securities with respect to the Past Performance
History of the Advisor as set forth in the Underwriting
Agreement, (ii) the Trust may at any time withdraw the
Registration Statement from the SEC or otherwise terminate
the Registration Statement or the offering of Interests, and
upon any such withdrawal or termination or if the "minimum"
number of Interests, as described in the Prospectus, is not
sold, this Agreement shall terminate and none of the parties
hereto shall have any obligation to any other party pursuant to
this Agreement, except pursuant to Section 10 of this
Agreement to the extent that such section is applicable.
6. Representations and Warranties of the Trust and the
Managing Owner. The Managing Owner hereby represents
and warrants (on its own behalf and on behalf of the Trust, as
applicable) to the Advisor that:
a. On the date hereof, the Trust is, and at all times during
the term of this Agreement and the Advisory Agreement will
be, a duly formed and validly existing business trust in good
standing under the laws of the State of Delaware and at all
times during the term of this Agreement and the Advisory
Agreement will be in good standing and qualified to do
business in each jurisdiction in which the nature or conduct of
its business requires such qualifications and the failure to be
so qualified materially adversely would affect its ability to
perform its obligations under this Agreement and the Advisory
Agreement and to operate as described in the Prospectus, and
the Managing Owner is, and at all times during the term of this
Agreement and the Advisory Agreement will be, a duly formed
and validly existing corporation in good standing under the
laws of the State of
17
Delaware and is, and at all times during the
term of this Agreement and the Advisory Agreement will be, in
good standing and qualified to do business as a foreign
corporation in the State of New York and in each other
jurisdiction in which the nature or conduct of its business
requires such qualifications and in which the failure to be so
qualified materially adversely would affect its ability to act as
Managing Owner of the Trust and to perform its obligations
hereunder and under the Advisory Agreement, and each has
full capacity and authority to conduct its business and to
perform its obligations under this Agreement and the Advisory
Agreement and to act as described in the Registration
Statement as of its effective date and the Prospectus as of the
Closing Date.
b. Each of this Agreement and the Advisory Agreement has
been duly and validly authorized, executed and delivered on
behalf of the Trust and the Managing Owner, is a valid and
binding agreement of the Trust and the Managing Owner and
is enforceable in accordance with its terms. The performance
of the Trust's and the Managing Owner's obligations under
this Agreement and under the Advisory Agreement, and the
consummation of the transactions set forth in this Agreement
and the Advisory Agreement, and in the Registration
Statement as of its effective date and Prospectus as of the
Closing Date are not contrary to the provisions of the Trust's
First Amended and Restated Declaration of Trust and Trust
Agreement (the "Trust Agreement"), Certificate of Trust or the
Managing Owner's Certificate of Incorporation or By-Laws,
respectively, any applicable statute, law or regulation of any
jurisdiction and will not result in any violation, breach or
default under any term or provision of any undertaking,
contract,
18
agreement or order, to which the Trust or the
Managing Owner, is a party or by which the Trust or the
Managing Owner is bound.
c. Each of the Trust and the Managing Owner has obtained
all required governmental and regulatory licenses,
registrations and approvals required by law as may be
necessary to perform their obligations under this Agreement
and under the Advisory Agreement and to act as described in
the Registration Statement as of its effective date and in the
Prospectus as of the Closing Date (including, without
limitation, the Managing Owner's registration as a commodity
pool operator under the CE Act and membership as a
commodity pool operator with the NFA) and will maintain and
renew any required licenses, registrations, approvals and
memberships required during the term of this Agreement and
the Advisory Agreement.
d. The Trust is not required to be registered as an
investment company under the Investment Company Act of
1940, as amended (the "Investment Company Act").
e. All authorizations, consents or orders of any court or of
any federal, state or other governmental or regulatory agency
or body required for the valid authorization, issuance, offer
and sale of the Interests have been obtained, and no order
preventing or suspending the use of the Prospectus with
respect to the Interests has been issued by the SEC, the CFTC
or the NFA. The Registration Statement as of its effective date
and the Prospectus as of the Closing Date contain all
statements which are required to be made therein, conform in
all
19
material respects with the requirements of the 1933 Act and
the CE Act, and the rules and regulations of the SEC and the
CFTC, respectively, thereunder, and with the rules of the NFA
and do not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein (with respect to the
Prospectus, in light of the circumstances in which they are
made) not misleading; and at all times subsequent hereto up
to and including the date of termination of the Initial Offering
Period and any Subsequent Offering Period, the Registration
Statement as of its effective date and the Prospectus as of the
Closing Date will contain all statements required to be made
therein and will conform in all material respects with the
requirements of the 1933 Act and the CE Act, and the rules and
regulations of the SEC and the CFTC, respectively, thereunder,
and with the rules of the NFA and will not contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein (with respect to the Prospectus,
in light of the circumstances in which they are made) not
misleading; provided, however, that this representation and
warranty shall not apply to any statements or omissions made
in reliance upon and in conformity with information furnished
to the Managing Owner, the Trust or to Prudential Securities
by or on behalf of the Advisor for the express purpose of
inclusion in the Registration Statement or the Prospectus
including, without limitation, references to the Advisor and its
affiliates, and controlling persons, shareholders, directors,
officers and employees, as well as to the Advisor's Trading
Approach and Past Performance History provided such
references have been approved.
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f. The Registration Statement as of its effective date and
the Prospectus as of the Closing Date have been delivered to
the Advisor.
g. There is no pending, or to its knowledge, threatened or
contemplated action, suit or proceeding before any court or
arbitration panel or before or by any governmental,
administrative or self-regulatory body to which the Trust, the
Managing Owner or the principals of either is a party, or to
which any of the assets of any of the foregoing persons is
subject, which might reasonably be expected to result in any
material adverse change in their condition (financial or
otherwise), business or prospects or reasonably might be
expected to affect adversely in any material respect any of
their assets or which reasonably might be expected to
materially impair their ability to discharge their obligations
under this Agreement or under the Advisory Agreement; and
neither the Trust nor the Managing Owner has received any
notice of an investigation by (i) the NFA regarding non-
compliance with NFA rules or the CE Act, (ii) the CFTC
regarding non-compliance with the CE Act or the rules and
regulations thereunder or (iii) any exchange regarding non-
compliance with the rules of such exchange which
investigation reasonably might be expected to materially
impair the ability of each of the Trust and the Managing Owner
to discharge its obligations under this Agreement or under the
Advisory Agreement.
7. Covenants of the Managing Owner and the Trust. If, at
any time during the term of the Advisory Agreement, the
Managing Owner or the Trust discovers any fact, omission or
event or that a change of circumstance has occurred which
would make the Managing Owner's or the Trust's
representations and warranties in Section 6 of this Agreement
20
inaccurate or incomplete in any material respect, the Trust or
the Managing Owner, as appropriate, promptly will provide
written notification to the Advisor of such fact, omission,
event or change of circumstance and the facts related thereto.
The Managing Owner and the Trust shall provide the Advisor
with a copy of each amendment to the Registration Statement
and amendment or supplement to the Prospectus, and no
amendment to the Registration Statement or amendment or
supplement to the Prospectus which contains any statement
or information regarding the Advisor will be filed or used
unless the Advisor has received reasonable prior notice and a
copy thereof and has consented in writing to such statement
or information being filed and used.
8. Trust's and Managing Owner's Closing Obligations. On
or prior to the Initial Closing Date, and thereafter on or prior to
each Subsequent Closing Date, if the Trust and the Managing
Owner have requested that the Advisor provide certificates,
documents and opinions pursuant to Section 4 of this
Agreement, the Trust and the Managing Owner shall deliver or
cause to be delivered to the Advisor, the certificates,
documents and opinions described below addressed to the
Advisor and, except as may be set forth below, dated each
such Closing Date:
a. Certificates of the Trust and the Managing Owner,
addressed to the Advisor, in the form proposed prior to the
Closing Date by counsel to the Trust and the Managing Owner
with such changes in such form as are proposed by the
Advisor or its counsel and are acceptable to the Trust, the
Managing Owner and their counsel so as to make such form
mutually acceptable to the Trust, the Managing Owner, the
Advisor and their respective counsel, with respect to, as
applicable, (i) the continued effectiveness of the Trust
Agreement and the
22
Certificate of Trust of the Trust and the
Certificate of Incorporation and By-Laws of the Managing
Owner, (ii) the continued effectiveness of the registration of
the Managing Owner as a commodity pool operator under the
CE Act and membership as a commodity pool operator with
the NFA and (iii) the incumbency and genuine signature of the
President and Secretary of the Managing Owner.
b. Certificates from the States of Delaware and New York
with respect to each of the Trust and the Managing Owner to
be dated at, on or around the Closing Date as to the formation
and good standing of the Trust and the Managing Owner.
c. Certificates of the Trust and the Managing Owner in the
form proposed prior to the Closing Date by counsel to the
Trust and the Managing Owner with such changes in such
form as are proposed by the Advisor or its counsel and are
acceptable to the Trust, the Managing Owner and their counsel
so as to make such form mutually acceptable to the Trust, the
Managing Owner, the Advisor and their respective counsel, to
the effect that:
(i) The representations and warranties in
Section 6 of this Agreement are true and correct in all material
respects on the date of the certificates as though made on
such date, and
(ii) The Trust and the Managing Owner have
each performed all covenants and agreements herein
contained to be performed on their part at or prior to the
Closing Date.
23
d. An opinion letter of Rosenman & Colin LLP, dated the
Closing Date, in form and substance satisfactory to the
Advisor, as follows:
(i) The Trust is a duly created and validly
existing business trust in good standing under the Delaware
Act, with requisite power and authority under the Delaware
Act, its Trust Agreement and its Certificate of Trust to perform
its obligations under this Agreement and under the Advisory
Agreement and to act as described in the Registration
Statement as of its effective date and the Prospectus as of the
Closing Date.
(ii) The Managing Owner is a duly formed
and validly existing corporation in good standing under the
laws of the State of Delaware and is duly qualified to conduct
business as a foreign corporation in good standing in the
State of New York. The Managing Owner has full corporate
power and authority under its Certificate of Incorporation, By-
Laws and the General Corporation Law of the State of
Delaware to perform its obligations under this Agreement and
under the Advisory Agreement and to act as described in the
Registration Statement as of its effective date and the
Prospectus as of the Closing Date.
(iii) Each of this Agreement and the Advisory
Agreement has been duly and validly authorized or ratified,
executed and delivered on behalf of each of the Trust and the
Managing Owner, and, assuming due execution and delivery
of each such Agreement by the Advisor, each agreement
constitutes the legal, valid and binding obligations of the Trust
and the Managing
24
Owner, respectively, enforceable in
accordance with their respective terms, except as the same
may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws at the time in effect affecting
creditors rights generally, or by applicable principles of equity,
whether in an action at law or in equity, and except that the
enforceability of the indemnification provisions may be limited
under applicable federal or state securities, commodities and
other laws or by public policy; and the execution and delivery
of such agreements and incurrence of the obligations
thereunder and the consummation of the transactions set forth
in such agreements and in the Prospectus will not violate or
result in a breach of their formation documents, and, to the
best of such counsel's knowledge, after due inquiry, will not
result in any violation, breach or default under any term or
provision of any undertaking, contract, agreement or order to
which they are parties or by which they are bound.
(iv) The Trust is not required to be registered
as an investment company under the Investment Company Act
in order to act as described in the Registration Statement as of
its effective date and in the Prospectus as of the Closing Date
or to perform its obligations under this Agreement or the
Advisory Agreement.
(v) To the best of such counsel's knowledge,
after due inquiry, all authorizations, consents or orders of any
court or of any federal, state or other governmental or
regulatory agency or body required for the valid authorization,
issuance, offer and sale of Interests have been obtained,
25
including such as may be required under the 1933 Act,
including the rules and regulations thereunder, the CE Act,
including the rules and regulations thereunder, the rules and
regulations of the NFA or the Blue Sky securities laws of any
state or of any jurisdiction in which offers and sales were
made, and, to the extent of such counsel's knowledge, no
order suspending the effectiveness of the Registration
Statement or the use of the Prospectus has been issued by the
SEC, the CFTC, the NFA or any state in which offers and sales
of Interests were made nor has any proceeding for the
issuance of such an order been instituted or threatened by the
SEC, the CFTC, the NFA or any such state. The foregoing may
be qualified by the fact that such counsel is not admitted to
practice law in all jurisdictions and that in rendering its
opinion such counsel shall rely solely upon an examination of
the Blue Sky securities laws and related rules, regulations and
administrative determinations, if any, promulgated thereunder,
of the various jurisdictions as reported in customarily relied
upon standard compilations, and upon such counsel's
understanding of the various conclusions expressed, formally
or informally, by administrative officials or other employees of
the various regulatory or other governmental agencies or
authorities concerned.
(vi) To the best of such counsel's knowledge,
after due inquiry, each of the Trust and the Managing Owner
has obtained all required governmental and regulatory
licenses, registrations and approvals required by law as may
be necessary in order for each of the Trust and the Managing
Owner to perform its obligations under this Agreement and
under the Advisory
26
Agreement and to act as described in the
Registration Statement as of its effective date and the
Prospectus as of the Closing Date (including, without
limitation, the Managing Owner's registration as a commodity
pool operator under the CE Act and membership as a
commodity pool operator with the NFA) and such licenses,
registrations and approvals have not, to the best of such
counsel's knowledge, after due inquiry, been rescinded,
revoked or otherwise removed.
(vii) To such counsel's knowledge without independent
investigation, except as described in the Prospectus, or in a
schedule delivered by counsel to Prudential Securities and the
Managing Owner prior to the date hereof, there is no pending
or threatened suit or proceeding known to such counsel,
before or by any court, governmental or regulatory body or
arbitration panel to which the Trust and the Managing Owner
or any of the assets of the Trust or the Managing Owner or any
of their principals is subject and which reasonably might be
expected to result in any material adverse change in the
condition (financial or otherwise), business or prospects of
the Trust or Managing Owner or any of their principals or
which reasonably might be expected materially adversely to
affect any of the assets of the Trust or Managing Owner or any
of their principals or which reasonably might be expected to
(A) impair materially the Trust's or Managing Owner's ability to
discharge their obligations to the Advisor or (B) result in a
matter which would require disclosure in the Registration
Statement or Prospectus which is not so disclosed; and, to the
extent of such counsel's knowledge, neither the
27
Trust or Managing Owner, nor any of their principals has received any
notice of an investigation by (i) the NFA regarding non-
compliance with its rules or the CE Act, (ii) the CFTC regarding
non-compliance with the CE Act or (iii) any exchange,
regarding non-compliance with its rules, which investigation
reasonably might be expected to (A) impair materially the
Trust's or Managing Owner's ability to discharge its
obligations to the Advisor or (B) result in a matter which would
require disclosure in the Registration Statement or Prospectus
which is not so disclosed.
(viii) The Registration Statement as of its effective date
and the Prospectus as of the Closing Date are responsive in all
material respects to the requirements of the 1933 Act,
including the rules and regulations thereunder, the CE Act,
including the rules and regulations thereunder, and the rules
and regulations of the NFA, and nothing has come to the
attention of such counsel that leads it to believe that either the
Registration Statement (at the time it initially became effective
and at the time any post-effective amendment thereto became
effective) or the Prospectus contains any untrue statement of a
material fact or omits to state a material fact required to be
stated therein or which is necessary to make the statements
therein (with respect to the Prospectus, in light of the
circumstances in which they were made) not misleading,
except that such counsel is not required to express any
opinion or belief (A) as to the financial statements or other
financial or statistical data, past performance tables and notes
thereto or other past performance information contained in the
Registration Statement or the
28
Prospectus or (B) as to any
statements or omissions made in reliance on and in
conformity with information furnished by the Advisor for the
express purpose of inclusion in the Registration Statement or
the Prospectus including, without limitation, references to the
Advisor and its affiliates, controlling persons, shareholders,
directors, officers and employees, as well as to the Advisor's
Trading Approach and Past Performance History.
In rendering such opinions, such counsel may rely (i) as to
matters of fact, on a certificate of an officer of the Managing
Owner, unless such counsel has actual knowledge otherwise
and (ii) as to matters of law of states other than that in which
they are licensed to practice law, upon the opinions of other
counsel, in each case satisfactory in form and substance to
the Advisor and its counsel, and such counsel shall state that
they believe the Advisor may rely on them.
9. Survival of Representations, Warranties and Covenants.
All representations, warranties and covenants in this
Agreement or contained in certificates required to be delivered
hereunder shall survive the delivery of any payment for the
Interests under the Underwriting Agreement and the
termination of the Advisory Agreement and this Agreement,
with respect to any matter arising while the Advisory
Agreement or this Agreement was in effect. Furthermore, all
representations, warranties and covenants hereunder shall
inure to the benefit of each of the parties to this Agreement
and to their respective successors and permitted assigns.
10. Indemnification.
29
a. In any action in which Prudential Securities, the Trust,
the Trustee or the Managing Owner, or its controlling persons,
shareholders, partners, directors, officers and/or employees of
any of the foregoing (the "PSI Indemnified Parties") are
parties, the Advisor agrees to indemnify and hold harmless the
foregoing persons against any loss, claim, damage, charge,
liability or expense (including, without limitation, reasonable
attorneys' and accountants' fees) ("Losses") to which such
persons may become subject, insofar as such Losses arise
out of or are based exclusively upon (i) any misrepresentation
or alleged misrepresentation or material breach or alleged
material breach of any warranty, covenant or agreement of the
Advisor contained in this Agreement or (ii) any untrue
statement or alleged untrue statement of any material fact
contained in the Registration Statement or the Prospectus or
the omission or alleged omission to state in the Registration
Statement or the Prospectus a material fact required to be
stated therein or necessary to make the statements therein
(with respect to the Prospectus, in light of the circumstances
in which they are made) not misleading, in each case under
this subclause (ii) to the extent, but only to the extent, that
such untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and
in material conformity with information furnished by the
Advisor to the Managing Owner for inclusion in the
Registration Statement or Prospectus and approved in writing
by the Advisor, in the form attached hereto as Exhibit A,
including, without limitation, all information relating to the
Advisor and its affiliates, controlling persons, shareholders,
directors, officers and employees, as well as to the Advisor's
Trading Approach and Past Performance
30
History, provided, however, that in respect of any Loss regarding (A)
an alleged (as opposed to an actual) misrepresentation or material breach
of any warranty, covenant or agreement of the Advisor
contained in this Agreement or (B) an alleged (as opposed to
an actual) untrue statement of any material fact contained in
the Registration Statement or the Prospectus, or an alleged (as
opposed to an actual) omission to state in the Registration
Statement or the Prospectus a material fact required to be
stated therein or necessary to make the statements therein
(with respect to the Prospectus, in light of the circumstances
in which they are made), not misleading, the Advisor's
obligations shall be limited to 40% of any payments made from
time to time by the PSI Indemnified Parties in respect thereof.
b. In any action in which the Advisor, or any of its
controlling persons, shareholders, directors, officers and/or
employees (the "Advisor Indemnified Parties") are parties, the
Managing Owner agrees (A) to indemnify and hold harmless
the Advisor Indemnified Parties against any Losses, insofar as
such Losses arise out of or are based exclusively upon (i) any
misrepresentation or alleged misrepresentation or material
breach or alleged material breach of any warranty, covenant or
agreement of the Trust or the Managing Owner contained in
this Agreement, or (ii) any untrue statement or alleged untrue
statement of any material fact contained in the Registration
Statement or the
31
Prospectus or the omission or alleged
omission to state in the Registration Statement or the
Prospectus a material fact required to be stated therein or
necessary to make the statements therein (with respect to the
Prospectus, in light of the circumstances in which they are
made) not misleading.
c. None of the indemnifications contained in this Section 10
shall be applicable with respect to default judgments or
confessions of judgment, or to settlements entered into by an
indemnified party claiming indemnification without the prior
written consent of the indemnifying party.
d. Promptly after receipt by an indemnified party under this
Section 10 of notice of any claim or dispute or commencement
of any action or litigation, such indemnified party will, if a
claim in respect thereof is to be made against an indemnifying
party under this Section 10, notify the indemnifying party of
the commencement thereof; but the omission to notify the
indemnifying party will not relieve it from any liability which it
may have to any indemnified party otherwise than under this
Section 10 except to the extent, if any, that such failure or
delay prejudiced the indemnifying party in defending against
the claim. In case any such claim, dispute, action or litigation
is brought or asserted against any indemnified party, and it
timely notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate in
the defense therein, and to the extent that it may wish, to
assume such defense thereof, with counsel specifically
approved in writing by such indemnified party, such approval
not to be unreasonably withheld, following notice from the
indemnifying party to such indemnified party of its election so
to assume the defense thereof; in which event, the
indemnifying party will not be liable to such
32
indemnified party under this Section 10 for any legal or other expenses
subsequently incurred by such indemnified party in
connection with the defense thereof, but shall continue to be
liable to the indemnified party in all other respects as
heretofore set forth in this Section 10. Notwithstanding any
other provisions of this Section 10, if, in any claim, dispute,
action or litigation as to which indemnity is or may be
available, any indemnified party reasonably determines that its
interests are or may be, in whole or in part, adverse to the
interests of the indemnifying party, the indemnified party may
retain its own counsel in connection with such claim, dispute,
action or litigation and shall continue to be indemnified by the
indemnifying party for any legal or any other expenses
reasonably incurred in connection with investigating or
defending such claim, dispute, action or litigation.
e. Expenses incurred by an indemnified party in defending
a threatened or asserted claim or a threatened or pending
action shall be paid by the indemnifying party in advance of
final disposition or settlement of such matter, if and to the
extent that the person on whose behalf such expenses are
paid shall agree in writing to reimburse the indemnifying party
in the event indemnification is not permitted under this
Section 10 upon final disposition or settlement.
f. The parties hereto acknowledge and agree on their own
behalf that the indemnities provided in this Agreement shall be
inapplicable in the event of any loss, claim, damage, charge or
liability arising out of or based upon, but limited to the extent
caused by, any misrepresentation or breach of any warranty,
covenant
33
or agreement of any indemnified party to any
indemnifying party contained in this Agreement.
11. Limits on Claims. The Advisor agrees that it will not take
any of the following actions against the Trust: (i) seek a
decree or order by a court having jurisdiction in the premises
(A) for relief in respect of the Trust in an involuntary case or
proceeding under the U.S. Bankruptcy Code or any other
federal or state bankruptcy, insolvency, reorganization,
rehabilitation, liquidation or similar law or (B) adjudging the
Trust a bankrupt or insolvent or seeking reorganization,
rehabilitation, liquidation, arrangement, adjustment or
composition of or in respect of the Trust under the U.S.
Bankruptcy Code or any other applicable federal or state law,
or appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator (or other similar official) of the Trust or of
any substantial part of any of its properties, or ordering the
winding up or liquidation of any of its affairs, (ii) seek a
petition for relief, reorganization or to take advantage of any
law referred to in the preceding clause or (iii) file an
involuntary petition for bankruptcy (collectively "Bankruptcy
or Insolvency Action"). In addition, the Advisor agrees that for
any obligations due and owing to it by the Trust, the Advisor
will look solely and exclusively to the assets of Series F or the
Managing Owner, if it has liability in its capacity as Managing
Owner, to satisfy its claims and will not seek to attach or
otherwise assert a claim against the assets of any other Series
or the other assets of the Trust, whether there is a Bankruptcy
or Insolvency Action taken. The parties agree that this
provision will survive the termination of this Agreement,
whether terminated in a Bankruptcy or Insolvency Action or
otherwise.
12. Subordination Agreement. Each of the Advisor, the
Managing Owner and the Trustee (the "Potential Creditor(s)")
agrees and consents (the "Consent") to look solely
34
to Series F, the Series for which advisory services are being
performed hereunder and assets of Series F (the "Series F
Assets") and to the Managing Owner and its assets for
payment. Series F Assets include only those funds and other
assets that are paid, held or distributed to the Trust on
account of and for the benefit of Series F, including, without
limitation, funds delivered to the Trust for the purchase of
interests in Series F. In furtherance of the Consent, the
Potential Creditors agree that (i) any debts, liabilities,
obligations, indebtedness, expenses and claims of any nature
and of all kinds and descriptions (collectively, "Claims")
incurred, contracted for or otherwise existing arising from,
related to or in connection with the Trust and its assets and
Series F and Series F Assets, shall be subject to the following
limitations:
a. Subordination of certain claims and rights: (i) except as
set forth below, the Claims, if any, of the Potential Creditors
(the "Subordinated Claims") shall be expressly subordinate
and junior in right of payment to any and all other Claims
against the Trust and any Series thereof, and any of their
respective assets, which may arise as a matter of law or
pursuant to any contract; provided, however, that the Potential
Creditors' Claims (if any) against Series F shall not be
considered Subordinated Claims with respect to enforcement
against and distribution and repayment from Series F, the
Series F Assets and the Managing Owner and its assets; and
provided further that the Potential Creditors' valid Claims, if
any, against Series F shall be pari passu and equal in right of
repayment and distribution with all other valid Claims against
Series F and (ii) the Potential Creditors, individually or
collectively, will not take, demand or receive from any Series
or the Trust or any of their respective assets (other than
Series F, the Series F Assets and the Managing Owner and its
assets) any payment for the Subordinated Claims;
35
b. The Claims of each of the Potential Creditors with respect
to Series F shall only be asserted and enforceable against
Series F, Series F Assets and the Managing Owner and its
assets; and such Claims shall not be asserted or enforceable
for any reason whatsoever against any other Series, the Trust
generally or any of their respective assets;
c. If the Claims of a Potential Creditor against Series F or
the Trust are secured in whole or in part, each of the Potential
Creditors hereby waives (under section 1111(b) of the U.S.
Bankruptcy Code (11 U.S.C. S 1111(b)) any right to have any
deficiency Claims (which deficiency Claims may arise in the
event such security is inadequate to satisfy such Claims)
treated as unsecured Claims against the Trust or any Series
(other than Series F), as the case may be;
d. In furtherance of the foregoing, if and to the extent that
the Potential Creditors receive monies in connection with the
Subordinated Claims from a Series or the Trust (or their
respective assets), other than Series F, Series F Assets and
the Managing Owner and its assets, the Potential Creditors
shall be deemed to hold such monies in trust and shall
promptly remit such monies to the Series or the Trust that paid
such amounts for distribution by the Series or the Trust in
accordance with the terms hereof; and
e. The foregoing Consent shall apply at all times
notwithstanding that the Claims are satisfied and
notwithstanding that the agreements in respect of such Claims
are terminated, rescinded or canceled.
36
13. Notices. Any notices under this Agreement required to
be given shall be effective only if given or confirmed in writing,
shall be deemed given by the party providing notice when
received by the party to whom notice is being given and shall
be sent certified mail, postage prepaid, or hand delivered, to
the following address, or to such other address as a party may
specify by written notice to each of the other parties hereto:
If to Prudential Securities: If to the Trustee:
Prudential Securities Incorporated Wilmington Trust Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇▇ Attention: Corporate Trust
Administration
If to the Managing Owner or the Trust:
Prudential Securities Futures
Management Inc.
▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
37
in any case with a copy to each of:
▇▇▇▇ ▇. ▇▇▇▇▇, Esq. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Rosenman & Colin LLP Prudential Securities Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ One ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇.
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Advisor: with a copy to:
Beacon Management Corporation (USA) ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 190 So. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇)▇▇▇-▇▇▇▇ Facsimile: (312) 01-7711
14. Governing Law. This Agreement shall be deemed to be
made under the laws of the State of New York applicable to
contracts made and to be performed in that State and shall be
governed by and construed in accordance with the laws of
that State, without regard to the conflict of laws principles.
15. Arbitration, Remedies. Each party hereto agrees that any
dispute relating to the subject matter of this Agreement shall
be settled and determined by arbitration in the City of New
York pursuant to the rules of NFA or, if NFA should refuse to
accept the matter, the American Arbitration Association. The
parties also agree that the award of the arbitrators shall be
final and may be enforced in the courts of New York and in any
other courts having jurisdiction over the parties.
16. Assignment. This Agreement may not be assigned by
any party without the express prior written consent of each of
the other parties hereto.
38
17. Amendment or Modification or Waiver. This Agreement
may not be amended or modified except by the written
consent of each of the parties hereto.
18. Successors. Except as set forth in Section 10 of this
Agreement, this Agreement is made solely for the benefit of
and shall be binding upon the Trust, the Managing Owner,
Prudential Securities, the Advisor and the respective
successors and permitted assigns of each of them, and no
other person shall have any right or obligation under this
Agreement. The terms "successors" and "assigns" shall not
include any purchasers, as such, of Interests.
19. Survival. The provisions of this Agreement shall survive
the termination of this Agreement with respect to any matter
arising while this Agreement was in effect.
20. No Waiver. No failure or delay on the part of any party
hereto 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. Any waiver granted hereunder must
be in writing and shall be valid only in the specific instance in
which given.
21. No Liability of Limited Owners. This Agreement has been
made and executed by and on behalf of the Trust and the
Managing Owner, and the obligations of the Trust and/or the
Managing Owner set forth in this Agreement are not binding
upon any of the Limited Owners individually, but rather, are
binding only upon the assets and property of the Trust and, to
the extent provided herein, upon the assets and property of
the Managing Owner.
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22. Headings. Headings to the Sections in this Agreement
are for the convenience of the parties only and are not
intended to be or to affect the meaning or interpretation of this
Agreement.
23. Complete Agreement. Except as otherwise provided
herein, this Agreement and the Advisory Agreement constitute
the entire agreement among the parties with respect to the
matters referred to herein, and no other agreement, verbal or
otherwise, shall be binding upon the parties hereto.
24. Counterparts. This Agreement may be executed in one
or more counterparts, all of which, when taken together, shall
be deemed to constitute one original instrument.
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IN WITNESS WHEREOF, this Agreement has been executed as
of the day and year first above written.
PRUDENTIAL SECURITIES INCORPORATED
By: ___________________________
Name:
Title:
PRUDENTIAL SECURITIES FUTURES
MANAGEMENT INC.
By: ___________________________
Name:
Title:
WORLD MONITOR TRUST II
By: PRUDENTIAL SECURITIES FUTURES
MANAGEMENT INC., as Managing Owner
By: ___________________________
Name:
Title:
WILMINGTON TRUST COMPANY
By: ___________________________
Name:
Title:
BEACON MANAGEMENT COMPANY (USA)
By: ___________________________
Name:
Title:
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Exhibit A
Consent
The undersigned Advisor has reviewed the Prospectus dated
______________________, 1999 of World Monitor Trust II with
respect to the information contained therein relating to the
undersigned Advisor and, in accordance with the
Representation Agreement among us dated as of the _____
day of ____________, 1999 ("Representation Agreement"),
hereby consents to all provisions to which it is required to
consent pursuant to the Representation Agreement and also
consents to the distribution of such Prospectus.
BEACON MANAGEMENT COMPANY (USA)
By:______________________________
Name:
Title:
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