Exhibit j2
FORM OF AGREEMENT
ESCROW AGREEMENT
THIS AGREEMENT is made as of __________, 2002, by and among [ASCENDANT
CAPITAL REGISTERED FUND, LLC], a ____________ limited liability company (the
"Company"), _________________________, a ________________ corporation (the
"Manager"), and PFPC INC., a Massachusetts corporation ("Escrow Agent").
WITNESSETH
WHEREAS, the Company has retained PFPC Inc. to provide certain
administration, accounting and investor services pursuant to an Administration,
Accounting and Investor Services Agreement dated as of _________, 2002; and
WHEREAS, the Company desires that PFPC Inc. also provide services as escrow
agent for the purpose of receiving payments from potential subscribing members
in the Company (the "Potential Investors") and PFPC Inc. wishes to provide such
services.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the parties hereto agree as follows:
1. ACCEPTANCE BY ESCROW AGENT. The Escrow Agent hereby accepts the appointment
as escrow agent hereunder and agrees to act on the terms and conditions
hereinafter set forth.
2. RIGHTS AND RESPONSIBILITIES OF ESCROW AGENT. The acceptance by the Escrow
Agent of its duties hereunder is subject to the following terms and
conditions, which the parties to this Agreement hereby agree shall govern
and control the Escrow Agent's rights, duties, liabilities and immunities.
(a) The Escrow Agent shall act hereunder as a depositary only, and in its
capacity as such,
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FORM OF AGREEMENT
it shall not be responsible or liable in any manner whatever for the
sufficiency, correctness, genuineness or validity of any document
furnished to the Escrow Agent or any asset deposited with it.
(b) "Written Instructions" mean written instructions received by the
Escrow Agent and signed by the Manager or any other person duly
authorized by the Manager, or by the members of the Company, to give
such instructions on behalf of the Company. The instructions may be
delivered by hand, mail, facsimile, cable, telex or telegram; except
that any instruction terminating this Agreement may be given only by
hand or mail. The Company shall file from time to time with the Escrow
Agent a certified copy certified by the Manager of each resolution of
the Manager or members authorizing the person or persons to give
Written Instructions. Such resolution shall include certified
signatures of such persons authorized to give Written Instructions.
This shall constitute conclusive evidence of the authority of the
signatories designated therein to act. Such resolution shall be
considered in full force and effect with the Escrow Agent fully
protected in acting in reliance thereon unless and until it receives
written notice from the Manager to the contrary.
The Escrow Agent may rely upon and shall be protected for any action
or omission it takes pursuant to Written Instructions if it, in good
faith, believes such Written Instructions to be genuine. Unless
otherwise provided in this Agreement, the Escrow Agent shall act only
upon Written Instructions. The Escrow Agent shall be entitled to
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FORM OF AGREEMENT
assume that any Written Instruction received hereunder is not in any
way inconsistent with the provisions of the limited liability company
agreement (the "Limited Liability Company Agreement") or this
Agreement or of any vote, resolution or proceeding of the Company's
members, unless and until the Escrow Agent receives Written
Instructions to the contrary.
(c) The Escrow Agent shall be obligated to exercise care and diligence in
the performance of its duties hereunder, to act in good faith and to
use its best efforts, within reasonable limits, in performing services
provided for under this Agreement. The Escrow Agent shall be liable
for any damages arising out if its failure to perform its duties under
this Agreement to the extent such damages arise out of its willful
misfeasance, fraud, bad faith, gross negligence or reckless disregard
of such duties.
(d) Notwithstanding anything in this Agreement to the contrary, neither
the Escrow Agent nor its affiliates shall be liable to the Company or
the Manager for any consequential, special or indirect losses or
damages which the Company may incur or suffer by or as a consequence
of the Escrow Agent's or its affiliates' performance of the services
provided hereunder, whether or not the likelihood of such losses or
damages was known by the Escrow Agent or its affiliates.
(e) Without limiting the generality of the foregoing or of any other
provision of this Agreement, the Escrow Agent shall not be liable for
losses beyond its control, provided it has acted in accordance with
the standard of care set forth above; and the Escrow
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FORM OF AGREEMENT
Agent shall not be liable for delays or errors or loss of data
occurring by reason of circumstances beyond its control, including
acts of civil or military authority, national emergencies, labor
difficulties, fire, flood, catastrophe, acts of God, insurrection,
war, riots or failure of the mails, transportation, communication or
power supply.
(f) The Company agrees to indemnify the Escrow Agent and hold it harmless
from and against any tax, charge, loss, liability, expense (including
reasonable attorneys fees and expenses), claim or demand arising
directly or indirectly from any action or omission to act which the
Escrow Agent takes (i) at the request or on the direction of or in
reliance on the advice of the Company or (ii) upon Written
Instructions; provided, however, that neither the Escrow Agent, nor
any of its affiliates, shall be indemnified against any liability (or
any expenses incident to such liability) arising out of the Escrow
Agent's or its affiliates own willful misfeasance, bad faith, gross
negligence or reckless disregard of its duties and obligations under
this Agreement. The Company shall indemnify and hold harmless the
Escrow Agent against and in respect of any liability for taxes and for
any penalties or interest in respect of taxes attributable to the
investment of funds held in escrow by the Escrow Agent pursuant to
this Agreement. Notwithstanding anything in this Agreement to the
contrary, the Company shall not be liable to the Escrow Agent for any
consequential, special or indirect losses or damages which the Escrow
Agent may incur or suffer, whether or not the likelihood of such
losses or damages was known by the Company. These indemnities shall
survive the resignation of the Escrow Agent or
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FORM OF AGREEMENT
the termination of this Agreement.
(g) The Escrow Agent shall have no duties except those specifically set
forth in this Agreement.
(h) The Escrow Agent shall have the right at any time it deems appropriate
to seek an adjudication in a court of competent jurisdiction as to the
respective rights of the parties hereto and shall not be held liable
by any party hereto for any delay or the consequences of any delay
occasioned by such resort to court.
(i) The Escrow Agent shall notify promptly the Manager of any discrepancy
between the amounts set forth on any remittance advice received by
Escrow Agent and the sums delivered to it therewith.
3. DEFINITIONS. Except as specifically set forth herein, the terms used in
this Agreement shall have the same meaning as set forth in the
Administration, Accounting and Investor Services Agreement between the
Company and PFPC, Inc.
4. DEPOSIT OF ESCROW FUND. The Escrow Agent shall establish an account in the
name of [Ascendant Capital Registered Fund, LLC], Escrow Account for the
Benefit of Investors (the "Subscription Account") and an account in the
name of [Ascendant Capital Registered Fund, LLC] Repurchase Account (the
"Repurchase Account") and together with the Subscription Account, the
"Accounts"). The Escrow Agent shall promptly deposit in the Subscription
Account checks remitted by Potential Investors and made payable to the
Company. Potential Investors also may deposit monies in the Subscription
Account by wire transfer pursuant to
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FORM OF AGREEMENT
instructions provided to them by the Company. Balances on deposit in the
Subscription Account will earn interest at prevailing market rates pursuant
to arrangements approved by the Company.
5. STATEMENTS. During the term of this Agreement, the Escrow Agent shall
provide the Company with (a) monthly statements containing the beginning
balance in each Account as well as all principal and income transactions
for the statement period and (b) a daily summary of amounts deposited and
the status of available funds. The Company shall be responsible for
reconciling such statements. The Escrow Agent shall be forever released and
discharged from all liability with respect to the accuracy of such
statements, except with respect to any such act or transaction as to which
the Company shall, within 90 days after the furnishing of the statement,
file written objections with the Escrow Agent.
6. DISTRIBUTIONS AND CLOSINGS. Upon Written Instructions, at each closing of
each offering of interests in the Company, the Escrow Agent will wire
principal balances on deposit in the Subscription Account to the account
designated by the Company. Such Written Instructions shall be sent to the
Escrow Agent by 2:00 p.m. on the closing date with respect to each closing.
In the event that a Potential Investor who has escrow funds in the
Subscription Account is not admitted into the Company, upon Written
Instructions, the Escrow Agent shall promptly issue refunds to the
Potential Investor in the amount of the principal balance with accrued
interest. Such refunds shall be made in check form.
7. INTEREST. All interest earned on the escrow funds deposited in the Accounts
hereunder shall be
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FORM OF AGREEMENT
added to and held in the Accounts. With respect to each closing, pursuant
to Written Instructions, within 5 business days of the crediting of such
Interest the Escrow Agent shall issue interest payments in check form to
each Potential Investor based on his or her individual balance in the
Subscription Account along with a cover letter and to the Manager based
upon its balance in the Subscription Account along with a cover letter. The
Escrow Agent will prepare and send notifications on Form 1099 for each
calendar year.
8. REPURCHASES. The Company from time to time may wire balances to the
Repurchase Account in connection with periodic repurchases of interests by
the Company from its members. Upon Written Instructions, the Escrow Agent
shall issue promptly repurchase payments from the Repurchase Account in
check form to the repurchasing member or to the Manager, as the case may
be. Upon Written Instructions, the Escrow Agent will withhold specified
amounts from repurchasing members. Any interest earned thereon will be
credited to the accounts of the Company.
9. TAX IDENTIFICATION NUMBER. All deposits to the Accounts shall be subject to
the Escrow Agent's receipt of a valid tax identification number for the
Company, Manager or Potential Investor, as applicable.
10. COMPENSATION. The fee of the Escrow Agent for its services hereunder shall
be paid by the Company as may be mutually agreed to in writing by the
Company and Escrow Agent. Notwithstanding the foregoing, standard account
transaction charges will be billed to the Company as an out-of-pocket
expense.
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FORM OF AGREEMENT
11. AMENDMENT. This Agreement may not be amended or supplemented, and no
provision hereof may be modified or waived, except by an instrument in
writing, signed by all of the parties hereto.
12. TERMINATION. This Agreement shall continue until terminated by either party
on 60 days prior written notice. Upon the termination of this Agreement and
upon the delivery of the balance of the Accounts to a successor escrow
agent or such other person as may be designated by Written Instructions,
the Escrow Agent shall be released and discharged of any and all further
obligations hereunder.
If no successor Escrow Agent has been designated pursuant to Written
Instructions to receive the balance of the Accounts at the expiration of
the 60-day period, the Escrow Agent shall have no further obligation
hereunder except to hold the escrow funds as a depositary. Upon written
notification by the Company of the appointment of the successor, the Escrow
Agent shall promptly deliver the balance of the Accounts to such successor,
and the duties of the resigning Escrow Agent shall thereupon in all
respects terminate, and it shall be released and discharged of any and all
further obligations hereunder.
13. EXECUTION. This Agreement may be executed in several counterparts, each of
which shall be deemed an original, but such counterparts together shall
constitute one and the same instrument.
14. MISCELLANEOUS. All covenants and agreements contained in this Agreement by
or on behalf of the parties hereto shall bind and inure to the benefit of
such parties and their respective heirs, administrators, legal
representatives, successors and assigns, as the case may be. The headings
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FORM OF AGREEMENT
in this Agreement are for convenience of reference only and shall neither
be considered as part of this Agreement, nor limit or otherwise affect the
meaning thereof. This Agreement shall be construed and enforced in
accordance with the laws of Delaware without regard to principles of
conflicts of law.
15. NOTICES. All instructions, notices and other communications hereunder must
be in writing and shall be deemed to have been duly given if delivered by
hand or facsimile or mailed by first class, registered mail, return receipt
requested, postage prepaid, and addressed as follows:
(a) If to the Company
[Ascendant Capital Registered Fund, LLC]
c/o:
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(b) If to the Escrow Agent
PFPC Inc.
Attn:
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(c) If to the Manager
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c/o:
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16. PARTIAL INVALIDITY. If any provision of this Agreement shall be held or
made invalid by a court decision, statute, rule or otherwise, the remainder
of this Agreement shall not be affected thereby.
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FORM OF AGREEMENT
16. ENTIRE AGREEMENT. This Agreement embodies the entire agreement and
understanding among the parties and supersedes all prior agreements and
understandings relating to the subject matter hereof; provided that, the
parties may embody in one or more separate documents their agreement, if
any, with respect to delegated duties and instructions.
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IN WITNESS THEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
[ASCENDANT CAPITAL REGISTERED FUND, LLC]
By:
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Name:
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Title:
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(as "Manager")
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By:
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Name:
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Title:
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PFPC INC.
By:
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Name:
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Title:
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