ALPHAMETRIX MANAGED FUTURES PLATFORMS SECOND AMENDED AND RESTATED ADVISORY AGREEMENT Dated as of June 1, 2010 __________________________________________ among ALPHAMETRIX ASPECT FUND MT0001 ALPHAMETRIX MANAGED FUTURES LLC (ASPECT SERIES) ALPHAMETRIX MANAGED FUTURES II LLC (ASPECT CS SERIES) ALPHAMETRIX MANAGED FUTURES IV LLC (RPM MANAGER SELECT USD SERIES) ALPHAMOSAIC (US) LLC CELL NO. 1 ALPHAMETRIX, LLC and ASPECT CAPITAL LIMITED __________________________________________ ALPHAMETRIX MANAGED FUTURES PLATFORMS SECOND AMENDED AND RESTATED ADVISORY AGREEMENT __________________________________________ TABLE OF CONTENTS

(a)   (i)           The Sponsor shall appoint the Trading Advisor to have discretionary authority and responsibility for independently directing the Futures Interest trading pursuant to the trading program and strategy agreed upon by the Sponsor and the Trading Advisor and disclosed in the Memorandum (the “Program”), as the same may be modified from time to time by the Trading Advisor as a result of its ongoing commitment to research and development.  Any such change will not be deemed to constitute a material change to the Investment Objective or Investment Policy (e ach term as defined in the Disclosure Document) and may be made without prior notification to the Sponsor.  However, any material change to the Investment Objective or Investment Policy (each term as defined in the Disclosure Document) (such change to be determined as material in the Trading Advisor’s reasonable discretion) will only be made upon giving the Sponsor at least twenty Business Days’ prior written notice (a “Business Day” means any day on which banks in New York City are not required or authorized to close).  The Trading Advisor may, on behalf of the Trading Fund and subject to Section 1(a)(iii) and Section 7, execute transactions in Futures Interests on either a principal or an agency basis, with or through such clearing brokers as approved by the Sponsor and executing brokers selected by the Trading Advisor, provided that the Trading Fund shall be a party to all “give-up” agreements, from time to time.  This limited authority granted to the Trading Advisor is a continuing power and shall continue in effect with respect to the Trading Advisor until terminated hereunder.

(c)   The Trading Advisor agrees to the terms set forth in “Appendix B — Trading Policies.”

(d)   Subject to adequate assurances of confidentiality, the Trading Advisor agrees that it will discuss with the Sponsor upon request any trading methods, programs, systems or strategies used by it for trading customer accounts which differ from the Program, provided, that nothing contained in this Agreement shall require the Trading Advisor to disclose with respect to such accounts that it deems to be proprietary or confidential information.

(e)   The Trading Advisor agrees to provide the Sponsor with such information concerning the Trading Advisor as the Sponsor may reasonably request (other than the identity of the Trading Advisor’s other customers or proprietary or confidential information concerning the Program and/or details of any other trading methods, programs, systems or strategies used by it for trading other customers’ accounts, except as may be required under Section 12(d) or (e)), subject to receipt of adequate assurances of confidentiality, including, but not limited to, information regarding any actual or prospective change in control, key personnel, the Program or financial condition, provided, that nothing contained in this A greement shall require the Trading Advisor to disclose with respect to itself what it deems to be proprietary or confidential information.

(f)   During the term of this Agreement, the Trading Advisor agrees to provide the Sponsor with updated information related to the Program’s performance results (which information shall be kept confidential as provided in Section (e)) within a reasonable period of time after the end of each month or at other times as may be agreed from time to time between the Trading Advisor and the Sponsor.

(g)   The Trading Advisor shall be responsible for promptly reviewing all oral and written confirmations it receives to determine that the trades made for the Trading Fund were made in accordance with the Trading Advisor’s instructions.  If the Trading Advisor determines that an error was made in connection with a trade or that a trade was made other than in accordance with the Trading Advisor’s instructions, the Trading Advisor shall promptly notify the Sponsor of this fact where such error is not corrected within three Business Days of the Trading Advisor’s making such determination, and shall consult with the Sponsor with regard to the best course of action for the Trading Fund. &# 160;All risks relating to transactions ordered by the Trading Advisor on behalf of the Trading Fund (including any trading or system error that has occurred in good faith) shall be borne by the Trading Fund as principal and, accordingly, all gains or losses accruing shall belong to or be borne by the Trading Fund; provided that, if a trading error resulting in losses is due to an action or omission of the Trading Advisor not meeting the applicable standard of conduct set forth in Section 2(a), such loss shall be borne by the Trading Advisor.

(h)   The Sponsor and the Trading Fund agree that the Trading Advisor shall be the sole trading advisor to the Trading Fund absent the Trading Advisor’s prior written consent.

(a)   The Trading Advisor and its affiliates and each of their officers, employees, directors, shareholders and controlling persons (the “Trading Advisor Parties”) shall have no liability to the Sponsor, the Aspect Series, the Aspect CS Series, the AlphaMosaic Series, the Platforms, any other entity that now or in the future invests in the Trading Fund, the Trading Fund or to any owners of Equity Interests (the “Members”), and shall be indemnified by the Trading Fund against any loss, liability, claim, damage or expense (including the reasonable cost of investigating or defending any alleged loss, liability, claim, damage or expense and reasonable counsel fees incurred in connection therewith) (“Losses”), for conduct undertaken as a trading advisor to the Trading Fund or otherwise relating to any action or omission of the Trading Advisor Parties (or alleged action or omission) in connection with this Agreement; provided that, such action or omission (or alleged action or omission) does not constitute

 

 

 

(b)   In the event the Sponsor, the Aspect Series, the Aspect CS Series, the AlphaMosaic Series, any other entity that now or in the future invests in the Trading Fund, or the Trading Fund or their respective principals, affiliates, officers, employees and controlling persons (collectively, the “Sponsor Parties”) is made a party to any threatened, pending or completed action, arbitration, claim, demand, dispute, lawsuit or other proceeding (each a, “Proceeding”) or otherwise incurs any Losses as a result of, or in connection with, the activities or claimed activities of any Trading A dvisor Party unrelated to the Trading Fund’s business, the Trading Advisor shall indemnify, defend and hold harmless such Sponsor Parties against any direct Losses incurred in connection therewith, except in circumstances where such Proceeding arises either solely or partly as a result of the gross negligence, willful misconduct or breach of this Agreement or any fiduciary obligation owed by the relevant Sponsor Parties.

(c)   The Trading Advisor Parties shall not be liable to the Sponsor Parties (to the extent permitted by any applicable laws, statutes, rules, regulations or orders and so far as not inconsistent with the provisions of this Agreement) including but not limited to any liability arising from the act or omission of any Clearing Broker (as defined in Section 7), Executing Broker (as defined in Section 7) or other counterparty, except that the Trading Advisor Parties shall be liable to the Sponsor Parties for acts by the Trading Advisor Parties with respect to the provision of services hereunder which constitute gross negligence, willful misconduct or breach of this Agreement by a Trading Advisor Party.

(d)   (i)           Promptly after receipt by any of the indemnified parties under this Agreement of notice of any Proceeding, the party or parties seeking indemnification (the “Indemnitee”) shall notify the party from which indemnification is sought (the “Indemnitor”) in writing of the commencement thereof if a claim with respect thereof is to be made under this Agreement.  Failure to notify an Indemnitor on a timely basis shall only qualify the right to indemnity hereunder to the extent that such fa ilure is prejudicial to the Indemnitor.

(e)   None of the indemnifications contained in this Section 2 shall be applicable with respect to default judgments, confessions of judgment or settlements entered into by the party or parties claiming indemnification without the prior written consent, which shall not be unreasonably withheld, of the party obligated to indemnify such party.

(f)   The Sponsor may not redeem or otherwise distribute or withdraw assets from the Trading Fund for the purpose of eliminating or reducing assets available to satisfy a claim for indemnification of the Trading Advisor pursuant to this Agreement.  For the avoidance of doubt, the preceding sentence shall not be construed as restricting the right of the Sponsor to make redemptions from the Trading Fund for the purpose of satisfying redemption or withdrawal requests of holders of Equity Interests.

(g)   The provisions of this Section 2 shall survive the termination of this Agreement.

(a)   The Trading Advisor agrees that it will not take any of the following actions against the Aspect Series, Aspect CS Series, RPM Series, AlphaMosaic Series or the Platforms: (i) seek a decree or order by a court having jurisdiction in the premises (A) for relief in respect of the Aspect Series, Aspect CS Series, RPM Series, AlphaMosaic Series or the Platforms in an involuntary case or proceeding under the Federal Bankruptcy Code or any other federal or state bankruptcy, insolvency, reorganization, rehabilitation, liquidation or similar law or (B) adjudging the Aspect Series, Aspect CS Series, RPM Series, AlphaMosaic Series or the Platforms bankrupt or insolvent, or seeking reorganization, rehabilitation, liquidat ion, arrangement, adjustment or composition of or in respect of the Aspect Series, Aspect CS Series, RPM Series, AlphaMosaic Series or the Platforms under the Federal 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 Aspect Series, Aspect CS Series, RPM Series, AlphaMosaic Series or the Platforms or of any substantial part of any of their properties, or ordering the winding up or liquidation of any of their 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”).

Aspect CS Series, the RPM Series, and the AlphaMosaic Series (which liabilities may be joint and several as set forth in Section 3(b) above) and no resort shall be had to the Members’ personal property for the satisfaction of any obligation or claim hereunder.  In addition, no resort shall be had to the assets of the Aspect Series, the Aspect CS Series or the AlphaMosaic Series, except with regard to Management Fees and Performance Fees as described in Section 3(b), for the satisfaction of any obligation or claim hereunder. Subject to Appendix A, for the avoidance of doubt, the parties hereto acknowledge and agree that the Platforms are organized in series pursuant to Section 18-215(b) of the Delaware Limited Liability Company Act.  As such, the debts, liabilities, obligations and expenses incurred, contr acted for or otherwise existing with respect to each Series shall be enforceable against the assets of such Series only, and not against the assets of the Platforms generally or the assets of any other Series.

If requested by the Sponsor, on or prior to each closing date during the continuous offering of the Aspect Series, Aspect CS Series and/or RPM Series (each a “Closing Date”), the Trading Advisor shall deliver or cause to be delivered, at the expense of the Trading Advisor, to the Selling Agents (as defined in the Memorandum, “Selling Agents”), the Series, the Trading Fund and the Sponsor, the reports, certificates and documents described below addressed to them and, except as may be set forth below, dated as of the Closing Date.

(a)   a report from the Trading Advisor which shall present, for the period from the date after the last day covered by the Trading Advisor’s performance information as set forth in the Part Two:  Series Information of the Memorandum to the latest practicable month–end before the Closing Date, figures which shall show the actual past performance of the Program (or, if such actual past performance information is unavailable, then the estimated past performance) for such period as well as any pro forma performance information for such period reasonably requested by the Sponsor, and which shall certify that, to the best of its knowledge, such figures are complete and accurate in all material respec ts;

(b)   a certificate of the Trading Advisor in the form proposed prior to the Closing Date by counsel to the Sponsor, with such changes in such form as are proposed by the Trading Advisor or its counsel and are acceptable to the Sponsor and its counsel so as to make such form mutually acceptable to the Sponsor, the Trading Advisor and their respective counsel, to the effect that:

       (1)   the representations and warranties of the Trading Advisor contained in this Agreement are true and correct in all material respects on the date of the certificate as though made on such date;

       (2)   nothing has come to the Trading Advisor’s attention which would cause the Trading Advisor to believe that, at any time from: (A) the time the forms required to register the Units under the Securities Exchange Act of 1934, as amended (such forms, collectively, the “Form 10”), initially became effective to (B) the Closing Date, the Form 10, as amended from time to time, or the Memorandum, as supplemented or amended from time to time, with respect to the Trading Advisor Parties, or with respect to the Program or performance information, 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, in light of the circumstances in which they were made, not misleading; and

       (3)   the Trading Advisor has performed all covenants and agreements herein contained to be performed on its part at or prior to the Closing Date.

(a)   The Sponsor acknowledges that the Confidential Information (as defined below) is the confidential property of the Trading Advisor.  The term “Confidential Information” shall include (i) any non-public information concerning the Trading Advisor and its operations, personnel, processes and any other aspect of its business, which may be acquired by the Sponsor, including, but not limited to, the Program and/or the Trading Advisor’s trading programs generally, its systems, methodologies, trading techniques, research, strategies, models and other commercial information; (ii) any of the trading positions of the Trading Fund or any other account or fund managed by the Trading Advisor; and ( iii) any notes, analyses, compilations, studies or other documents or records prepared by the Sponsor based on any of the information described under (i) – (iii) above. For the avoidance of doubt, nothing in this Agreement shall require the Trading Advisor to disclose the confidential or proprietary details of the Program and/or the Trading Advisor’s trading programs generally, its systems, methodologies, trading techniques, research, strategies, models and other commercial information, except only to the extent that such disclosure may be legally compelled under applicable law or may be required under Section 12(d).

(b)   The Sponsor further agrees that it will keep confidential and will not disclose Confidential Information to any third party (including any Members) or to its own employees except employees on a “need to know” basis and as, and to the extent that, it may be determined by the Sponsor to be expressly required by: (i) any law or statute; (ii) governmental, regulatory or self-regulatory agency or organization, rule, regulation or order; (iii) the request of any governmental, regulatory or self-regulatory agency or organization; (iv) valid legal process; or (v) as otherwise authorized by the Trading Advisor from time to time.  Notwithstanding anything to the contrary in this Section 6, the Spons or may disclose position level transparency to RPM Risk & Portfolio Management Aktiebolag upon execution by RPM Risk & Portfolio Management Aktiebolag and Spectrum Global Fund Administration of a confidentiality agreement in a form acceptable to the Trading Advisor.

(c)   The Trading Fund and the Sponsor further agree that they shall not copy, disclose, misuse, misappropriate or reverse engineer or otherwise appropriate or make use of in any manner the investment and trading strategies, systems, algorithms, models, techniques, methods, policies, programs and analyses previously, currently or hereafter used by the Trading Advisor in the conduct of its business including all data, details, components, specifications, codes, formulae, know-how (technical or otherwise), electronic data processing systems, computer software programs and computer hardware systems relating to the foregoing, and all embodiments, articulations, applications, expressions and reproductions of any of the fo regoing including, without limitation, documents, notes, print-outs, work papers, charts, diskettes, tapes and manuals.  For the avoidance of doubt, all performance information relating to the Program, the Trading Fund, the Aspect Series, the Aspect CS Series, the AlphaMosaic Series and the Platform that is provided on an intra-month basis, and all exposure reports, shall be deemed confidential information and not distributed to Members or any other party, except as otherwise indicated in clauses (b)(i) through (v) above.

(d)   The Sponsor acknowledges and agrees that the Trading Advisor would not have an adequate remedy at law and would be irreparably harmed in the event that any of the provisions of this Section 6 were not performed in accordance with their specific terms or were otherwise breached.  It is accordingly agreed that the Trading Advisor shall be entitled to equitable and injunctive relief, on an emergency, temporary, preliminary and/or permanent basis, to prevent any such breach or the continuation thereof, without first being required to post any bond or show actual damages, in addition to any other remedy to which the Trading Advisor may be entitled at law or in equity. It is further understood and agreed th at no failure to or delay in exercising any right, power or privilege hereunder shall operate as a waiver thereof, and no single or partial exercise of any right, power or privilege hereunder shall preclude any other or further exercise of any right, power or privilege.  If any action is initiated to enforce the provisions hereof, the prevailing party shall be entitled to reimbursement of all costs and expenses, including reasonable counsel fees, incurred by it in connection therewith.

(a)   All Futures Interest trades, including foreign exchange trades, for the accounts of the Trading Fund shall be cleared through such commodity clearing broker or brokers as the Sponsor directs.  The Trading Fund will clear Futures Interest trades through Credit Suisse Securities (USA) LLC (“Credit Suisse Securities” or the “Clearing Broker”).

(b)   All foreign exchange trades for the accounts of the Trading Fund shall be executed through such commodity broker or brokers and banks (or other forward dealers) as the Trading Advisor may consider necessary or appropriate in its reasonable discretion and which are pre-approved by the Sponsor, which approval shall not be unreasonably withheld.

(c)   All Futures Interest trades, other than foreign exchange trades, for the accounts of the Trading Fund shall be executed through such commodity broker or brokers and banks (the “Executing Brokers”) as the Trading Advisor may consider necessary or appropriate in its reasonable discretion if such broker(s) agree to “give up” all transactions to the Clearing Broker for clearance subject to Section 1(a)(iii).  If the Trading Fund is not a signatory to the resulting give-up agreements pursuant to Section 1(a)(iii), the Trading Advisor shall notify the Sponsor and the Trading Fund from time to time in writing of the Executing Bro kers selected by the Trading Advisor.

Trading Fund, provided that such confirmations and reports are actually in the Trading Advisor’s possession or control, as the Sponsor deems appropriate and in circumstances where the Sponsor cannot obtain copies of these confirmations and reports on its own behalf.  Upon request, the Sponsor will provide the Trading Advisor with accurate information with respect to the Trading Fund.

(a)   In consideration of and in compensation for the performance of the Trading Advisor’s services under this Agreement, the Trading Advisor shall receive from the Trading Fund a management fee (the “Management Fee”) and a performance fee (the “Performance Fee”) as set forth in the “Appendix A — Fee Schedule” hereto, except that in the case of any Management Fees or Performance Fees payable in respect of the AlphaMosaic Series’ investment in the Trading Fund, such portion of the Management Fee and Performance Fee shall be paid by the Sponsor, rather tha n by the Trading Fund.

(b)   Management Fees and Performance Fees (including, if applicable, any United Kingdom value added tax or any analogous taxation thereon) shall be paid within twenty Business Days following the end of the period for which they are payable, unless the Sponsor is unable to value a material portion of the Trading Fund’s positions, in which case the Management Fees and Performance Fees will be paid as soon as reasonably possible after such positions have been valued.  For the avoidance of doubt, all fees and expenses payable under this Agreement shall be stated exclusive of any United Kingdom value added tax or any analogous taxation payable or chargeable thereon and, if applicable, the Trading Fund or the Sponsor, in the case of the AlphaMosaic Series, shall pay to the Trading Advisor an amount equal to any United Kingdom value added tax or any analogous taxation so chargeable against production by the Trading Advisor of an appropriate tax invoice addressed to the Trading Fund or the Sponsor, as the case may be.  If a Performance Fee shall have been paid by the Trading Fund or the Sponsor to the Trading Advisor in respect of any calendar quarter and the Trading Advisor shall incur subsequent losses in trading on behalf of the Trading Fund, the Trading Advisor shall nevertheless be entitled to retain amounts previously paid to it in respect of New Net Trading Profits (as defined in Appendix A).

(c)   The Trading Advisor will be provided by the Sponsor with the data used by the Sponsor to compute the foregoing fees within twenty Business Days of the end of the relevant period.

(d)   For purposes of allocating fees hereunder, the Trading Fund shall issue a separate series of shares with respect to, or otherwise separately account for, the Aspect Series, the Aspect CS Series and the AlphaMosaic Series.  Additional series may be issued to new investors with the prior written consent of the Trading Advisor.

(a)   This Agreement shall commence on the date hereof and, unless sooner terminated pursuant to sections (b), (c), (e) or (f) of this Section 10, shall continue in effect until the close of business on March 31, 2011 (the “Initial Term”).  After the expiration of the Initial Term, unless sooner terminated, this Agreement shall be renewed automatically on the same terms and conditions set forth herein for successive additional one-year terms, each of which shall commence on the first day of the month subsequent to the conclusion of the then-current term.  Notice of any such termination shall require thirty (30) days’ prior w ritten notice.

(b)   This Agreement may be terminated at any time at the election of the Sponsor in its sole discretion upon at least one Business Day’s prior written notice to the Trading Advisor.  The Sponsor will use its reasonable best efforts to cause any termination to occur as of a month-end.

(c)   The Trading Advisor shall have the right to terminate this Agreement at any time upon ten (10) days’ written notice to the Trading Fund and the Sponsor in the event (i) of the receipt by the Trading Advisor of an opinion of independent counsel satisfactory to the Trading Advisor and the Trading Fund that by reason of the Trading Advisor’s activities with respect to the Trading Fund, it is required to register as an investment adviser under the Investment Advisers Act of 1940, as amended, or under the laws of any state and it is not so registered; (ii) that the registration of the Sponsor as a commodity pool operator under the CEA, or its NFA membership in such capacity, is revoked, suspended, termin ated or not renewed; (iii) the Sponsor imposes additional trading limitation(s) pursuant to Section 1 of this Agreement which the Trading Advisor does not agree to follow in its management of the Trading Fund, or the Sponsor overrides trading instructions of the Trading Advisor or does not consent to a material change to the Program requested by the Trading Advisor; (iv) the Sponsor elects (pursuant to Section 1 of this Agreement) to have the Trading Advisor use a different program in the Trading Advisor’s management of the Trading Fund’s assets from that which the Trading Advisor is then using to manage such assets and the Trading Advisor objects to using such different program; (v) there is an unauthorized assignment of this Agreement by the Trading Fund or the Sponsor; (vi) there is a material breach of this Agreement by the Trading Fund and/or the Sponsor after giving written notice to the Sponsor which identifies such breach and such material breach has not been cured within ten Business Day s following receipt of such notice by the Sponsor; or (vii) other good cause is shown and the written consent of the Sponsor is obtained (which shall not be unreasonably withheld or delayed).  In the event that the Trading Advisor terminates the Agreement in accordance with this clause 10(c), the Trading Advisor shall use reasonable endeavors to liquidate the assets of the Account in an orderly and mutually agreed upon fashion given the market conditions at the time and the nature of the positions held in the Account with due regard for the best interests of the Trading Fund.

(d)   Notwithstanding any other provisions to the contrary, the Trading Advisor or the Trading Fund may terminate this Agreement upon thirty (30) days’ prior written notice.  In the event that the Trading Advisor terminates the Agreement in accordance with this clause 10(d), the Trading Advisor shall use reasonable endeavors to liquidate the assets of the Account in an orderly and mutually agreed upon fashion given the market conditions at the time and the nature of the positions held in the Account with due regard for the best interests of the Trading Fund.

(e)   In the event that this Agreement is terminated pursuant to this Section 10, the Trading Advisor shall be entitled to, and the Trading Fund or the Sponsor (with respect to the AlphaMosaic Series) shall pay, the Management Fee and the Performance Fee, if any, which shall be computed (i) with respect to the Management Fee, on a pro rata basis, based upon the portion of the month for which the Trading Advisor had such assets under management, and (ii) with respect to the Performance Fee, if any, as if the effective date of termination was the last day of the then current calendar quarter.  The rights of the Trading Advisor to fees earned through the earlier to occur of the date of expiration or termination shall survive this Agreement until satisfied.

(g)   Notwithstanding anything to the contrary (implied or explicit) in this Agreement, a majority by the Units of the Aspect Series or the Aspect CS Series can vote (in a meeting or by written consent) to remove the Sponsor with respect to the Aspect Series or the Aspect CS Series, respectively, and replace the Sponsor with a third party of their choice.  If the Sponsor is so removed for either the Aspect Series or the Aspect CS Series, this Agreement with respect to the Aspect Series and/or the Aspect CS Series (as the case may be) shall be terminated; provided, however that Section 21 shall survive with respect to the terminated Series.

(a)   The Trading Advisor shall be free to manage and trade accounts for other investors (including other public and private commodity pools) during the term of this Agreement and to use the same or other information and trading approach utilized in the performance of services for the Trading Fund for such other accounts so long as the Trading Advisor’s ability to carry out its obligations and duties to the Trading Fund pursuant to this Agreement is not materially impaired thereby.  In addition, the Trading Advisor Parties also will be permitted to trade in Futures Interests using the Program or otherwise for their own accounts, so long as the Trading Advisor’s ability to carry out its obligatio ns and duties to the Trading Fund pursuant to this Agreement is not materially impaired thereby.  Neither the Trading Advisor nor the Trading Advisor Parties shall be liable to account to the Sponsor or the Trading Fund for any profit, commission or remuneration made or received from or by reason of such transactions or any connected transactions and the Trading Advisor’s fees shall not, unless otherwise provided, be abated thereby.

(b)   The Trading Fund and the Sponsor each agree that the Trading Advisor may (but only in accordance with the rules set out in the Financial Services Authority (“FSA”) Handbooks (the “FSA Rules”)) combine orders for the Trading Fund with the Trading Advisor’s own orders or orders of any Trading Advisor Party, or with the orders of any other client of the Trading Advisor and that such

 

 

 

combination of orders may, on some occasions, produce a more favorable price and, on others, a less favorable price than that which the Trading Fund would have obtained had the Trading Fund’s order been executed separately.

(c)   The Trading Advisor agrees, in its management of accounts other than the account of the Trading Fund, that it will not knowingly or deliberately favor on an overall basis any other account managed or controlled by it or any of the Trading Advisor Parties (in whole or in part) over the Trading Fund.  The preceding sentence shall not be interpreted to preclude (i) the Trading Advisor from charging another client fees which differ from the fees to be paid to it hereunder or otherwise establishing business terms for an account that are different than (and superior to) the business terms of the Trading Fund or the Series; (ii) the use of a different trading approach for another account, including a trading approach that is more profitable and/or less volatile than the Program; or (iii) an adjustment by the Trading Advisor in the implementation of the Program which is undertaken by the Trading Advisor in good faith in order to accommodate additional accounts.  The Trading Advisor, upon reasonable request and receipt of adequate assurances of confidentiality, shall provide the Sponsor with an explanation of the differences, if any, in performance between the Trading Fund and any other similar account traded pursuant to the Program for which the Trading Advisor acts as a commodity trading advisor (in whole or in part).

(d)   Upon the reasonable request of, and upon reasonable notice of not less than three Business Days from, the Sponsor, the Trading Advisor shall permit the Sponsor to review at the Trading Advisor’s offices during normal business hours such trading records as it reasonably may request for the purpose of confirming that the Trading Fund has been treated equitably on an overall basis with respect to advice rendered during the term of this Agreement by the Trading Advisor in relation to other accounts managed by the Trading Advisor pursuant to the Program (for the avoidance of doubt, the parties acknowledge that the Sponsor may inspect, subject to such restrictions as the Trading Advisor may reasonably deem nece ssary or advisable so as to preserve the confidentiality of proprietary information and the identity of its clients:  (i) such trading records of the accounts managed by the Trading Advisor pursuant to the Program and (ii) certain performance information of other accounts traded pursuant to the Program, during normal business hours as the Sponsor reasonably may request; in each case provided, however, that the Trading Advisor shall not be required by the foregoing to reveal any information the disclosure of which would cause the Trading Advisor to breach any other contractual confidentiality obligations to which the Trading Advisor is subject).  The Trading Advisor may, in its discretion, withhold from any such report or inspection the identity of the client for whom any such account is maintained, and in any event the Sponsor shall keep confidential all such information obtained by it from the Trading Advisor.

speculative position limits).  The Trading Advisor presently believes that the Program can be implemented for the benefit of the Trading Fund notwithstanding the possibility that, from time to time, speculative position limits may become applicable.

(a)   All references to the Trading Advisor, its principals and the Program in the Memorandum are complete and accurate in all material respects as of the date of such Memorandum and the Memorandum does not contain any untrue statement of a material fact regarding the Trading Advisor, its principals or the Program or omit to state a material fact regarding the Trading Advisor, its principals or the Program which is necessary to make the statements therein not misleading.

(b)   The information with respect to the Trading Advisor set forth in the actual performance tables in the Memorandum complies in all material respects with the CFTC rules.  The Disclosure Document complies in all material respects with the applicable regulations promulgated under the CEA by the CFTC and the NFA Rules.

(c)   The Trading Advisor is duly registered under the CEA as a commodity trading advisor, is a member of the NFA in such capacity, is in compliance with such other registration and licensing requirements as shall be necessary to enable it to perform its obligations hereunder and agrees to maintain and renew such registrations and licenses during the term of this Agreement.

(d)   The Trading Advisor has complied, and will continue to comply, in all material respects with all laws, statutes, rules, regulations and orders having application to its business, properties and assets, the violation of which might reasonably be expected, in the Trading Advisor’s best knowledge and belief, to materially and adversely affect its ability to comply with and perform its obligations under this Agreement.  As of the date hereof, there are no threatened, pending or completed actions, arbitrations, claims, demands, disputes, lawsuits or other proceedings, notices of investigation or investigations pending or, to the best knowledge and belief of the Trading Advisor, threatened against any Trading Advisor Party regarding noncompliance with any applicable laws, statutes, rules, regulations or orders, or at law or in equity, or before or by any court, any foreign, federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, or any governmental, regulatory or self-regulatory agency, organization, exchange or other body, in each case in which an adverse decision might reasonably be expected, in the Trading Advisor’s best knowledge and belief, to materially and adversely affect its ability to comply with or perform its obligations under this Agreement or result in a material adverse change in the condition, financial or otherwise, business or prospects of the Trading Advisor.

(e)   The Trading Advisor is duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation and has full power and authority to enter into this Agreement and to provide the services required of it hereunder.  The Trading Advisor is qualified to conduct business and is in good standing in every jurisdiction in which the nature or conduct of its business requires such qualification and the failure to qualify might reasonably be expected to have a materially adverse effect on its ability to comply with or perform its obligations under this Agreement (it being understood that any decision as to the jurisdiction or jurisdictions in which the Trading Advisor shall conduc t its business is within the sole discretion of the Trading Advisor).

(f)   The execution and delivery of this Agreement and the incurrence and performance of the obligations contemplated in this Agreement by the Trading Advisor will not conflict with, violate, breach

 

 

 

or constitute a default under any term or provision of its certificate of incorporation, by-laws or other charter or governing documents, or any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Trading Advisor is a party, or by which it is bound, or to which any of the property or assets of the Trading Advisor is subject, or any laws, statutes, rules, regulations, orders or other legal requirement applicable to the Trading Advisor or to the property or assets of the Trading Advisor of any court or any regulatory authority having jurisdiction over the Trading Advisor.

(g)   This Agreement has been duly and validly authorized, executed and delivered by the Trading Advisor and is a valid and binding agreement of the Trading Advisor enforceable in accordance with its terms.

(h)   At any time during the term of this Agreement that a disclosure document relating to any Equity Interests is required to be delivered in connection with the offer and sale thereof, the Trading Advisor agrees upon the request of the Sponsor to provide the Sponsor with such information as shall be necessary so that, as to the Trading Advisor Parties, such disclosure document is complete and accurate in all material respects.

(i)   The Trading Advisor is not bankrupt or insolvent.

(j)   The Trading Advisor will use its reasonable best efforts to implement a fair and consistent allocation policy which seeks to ensure that all clients are treated equitably and positions allocated as nearly as possible in proportion to the assets available for trading of the accounts managed or controlled by it.

All representations, warranties and covenants contained in this Agreement shall be continuing during the term of this Agreement and shall survive the termination of this Agreement with respect to any matter arising while this Agreement was in effect.  The Trading Advisor hereby agrees that as of the date of this Agreement it is, and during its term shall be, in compliance with its representations, warranties and covenants herein contained.  In addition, if at any time any event occurs which would make such representations, warranties or covenants not true, the Trading Advisor will promptly notify the other parties of such facts in the manner provided below.  All representations, warranties and covenants herein contained shall inure to the benefit of the party to whom it is addressed and its respectiv e heirs, executors, administrators, legal representatives, successors and permitted assigns.

The Sponsor represents and warrants to the Trading Advisor for itself and the Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series and RPM Series that:

(a)   The Memorandum and marketing materials relating to the Equity Interests as supplemented and amended from time to time are complete and accurate in all material respects and do not contain any untrue statement of a material fact or omit to state a material fact which is necessary to make the statements therein not misleading, except that the foregoing representation does not apply to any statement or omission concerning any Trading Advisor Party in the Memorandum, made in reliance upon, and in conformity with, information furnished to the Sponsor by or on behalf of any Trading Advisor Party expressly for use in the Memorandum.

(b)   The Sponsor is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware and has full power and authority to perform its obligations under this Agreement.  The Sponsor will be qualified to conduct business and will be in good standing in every jurisdiction in which the nature or conduct of its business requires such qualification

 

 

 

and the failure to qualify might reasonably be expected to have a materially adverse effect on its ability to comply with or perform its obligations under this Agreement (it being understood that any decision as to the jurisdiction or jurisdictions in which the Sponsor shall conduct its business is within the sole discretion of the Sponsor).

(c)   The Sponsor, Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series and RPM Series have the capacity and authority to enter into this Agreement.

(d)   This Agreement has been duly and validly authorized, executed and delivered on behalf of the Sponsor, Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series and RPM Series and is a valid and binding agreement of the Sponsor, Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series and RPM Series enforceable in accordance with its terms.

(e)   The execution and delivery of this Agreement and the incurrence and performance of the obligations contemplated in this Agreement by the Sponsor, Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series and RPM Series respectively, will not conflict with, violate, breach or constitute a default under any term or provision of the certificates of incorporation, by-laws or other charter or governing documents of the Sponsor, Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series and RPM Series, or any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Sponsor, Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series or RPM Series is a party , or by which either the Sponsor, Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series or RPM Series is bound, or to which any of the property or assets of the Sponsor, Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series or RPM Series, as the case may be, is subject, or any law, statute, rule, regulation, order or other legal requirement applicable to the Sponsor, Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series or RPM Series or to the property or assets of the Sponsor, Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series or RPM Series of any court or any regulatory authority having jurisdiction over the Sponsor, Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series or RPM Series.

(f)   The Sponsor is registered as a commodity pool operator and is a member of the NFA, and it will maintain and renew such registration and membership during the term of this Agreement.

(g)   The Trading Fund is a company organized and validly existing under the laws of the Cayman Islands and has full power and authority to enter into this Agreement and to perform its obligations under this Agreement.  The Aspect Series, the Aspect CS Series, the AlphaMosaic Series and the RPM Series are validly existing series of AlphaMetrix Managed Futures LLC, AlphaMetrix Managed Futures II LLC, AlphaMosaic (US) LLC and AlphaMetrix Managed Futures IV LLC, respectively, each of which, is a limited liability company organized and validly existing under the laws of the State of Delaware, respectively, and the Aspect Series, the Aspect CS Series, the AlphaMosaic Series and the RPM Series each has full power and authority to enter into this Agreement and to perform its obligations under this Agreement. The Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series and the RPM Series will be qualified to conduct business and will be in good standing in every jurisdiction in which the nature or conduct of their business requires such qualification and the failure to qualify might reasonably be expected to have a materially adverse effect on their ability to comply with or perform their obligations under this Agreement (it being understood that any decision as to the jurisdiction or jurisdictions in which the Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series and the RPM Series shall conduct its business is within the sole discretion of the Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series and the RPM Series, respectively).

(h)   The Sponsor, Trading Fund, Aspect Series, the Aspect CS Series, the AlphaMosaic Series and the RPM Series have each complied, and will continue to comply in all material respects with all

 

 

 

laws, statutes, rules, regulations and orders having application to its business, properties and assets, the violation of which might reasonably be expected, in the Sponsor’s or the Trading Fund’s, Aspect Series’, Aspect CS Series’, AlphaMosaic Series’ or the RPM Series’ best knowledge and belief, to materially and adversely affect its ability to comply with and perform its obligations under this Agreement and in connection with the offering of any Equity Interests.  As of the date hereof, there are no threatened, pending or completed actions, arbitrations, claims, demands, disputes, lawsuits or other proceedings, notices of investigation or investigations pending or, to the best knowledge and belief of the Sponsor, Trading Fund, Aspect Series,  Aspect CS Series, AlphaMosaic Series or the RP M Series threatened against the Sponsor, Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series or the RPM Series, as the case may be, regarding noncompliance with any applicable laws, statutes, rules, regulations or orders, or at law or in equity, or before or by any court, any foreign, federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, or any governmental, regulatory or self-regulatory agency, organization, exchange or other body, in which an adverse decision might reasonably be expected, in the Sponsor’s or the Trading Fund’s, Aspect Series’, Aspect CS Series’, AlphaMosaic Series’ or the RPM Series’ best knowledge and belief, to materially and adversely affect its ability to comply with or perform its obligations under this Agreement or result in a material adverse change in the condition, financial or otherwise, business or prospects of the Sponsor, Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series or the RPM Series.

(i)   None of the Sponsor, the Trading Fund, the Aspect Series, the Aspect CS Series, the AlphaMosaic Series or the RPM Series is bankrupt or insolvent.

 

(j)   Each of the Sponsor, Trading Fund, Aspect Series, Aspect CS Series, AlphaMosaic Series and the RPM Series has read and understood the Disclosure Document (including the Risk Disclosure Statement contained therein) and is aware of the risks inherent in the Program (including, without limitation, the risks inherent in trading in the Futures Interests envisaged by the Program).

 

(k)   The Trading Fund shall be exclusively owned by the Aspect Series, the Aspect CS Series and the AlphaMosaic Series. The AlphaMosaic Series shall be exclusively owned by the RPM Series. Additional entities may invest in the Trading Fund or the AlphaMosaic Series with the prior written consent of the Trading Advisor.  For the avoidance of doubt, the AlphaMosaic Series shall not be offered to investors as part of the AlphaMosaic (US) LLC platform but used solely to facilitate investments by the RPM Series.

 

(l)   Subject to the other provisions contained herein, the Sponsor shall provide the Trading Advisor with advance written notice of at least one week regarding any structural changes to the Trading Fund, the Aspect Series, the Aspect CS Series, the AlphaMosaic Series or the RPM Series.  The parties agree that any such restructuring shall not have any adverse affect on the Trading Advisor or its ability to provide investment management services to the Trading Fund.

 

(m)   The Sponsor is able to successfully permit disclosure of the trading positions of the Trading Fund with respect to the AlphaMosaic Series solely to RPM Risk & Portfolio Management Aktiebolag and prohibit the disclosure of the trading positions of the Trading Fund with respect to the AlphaMosaic Series to any investor in the RPM Series or the AlphaMosaic (US) LLC “platform.”

 

(n)   The Trading Fund is not a “benefit plan investor” (as defined below) and the Trading Fund and Sponsor agree to notify the Trading Advisor immediately if the Trading Fund becomes a benefit plan investor.  As used herein, “benefit plan investor” means (a) any “employee benefit plan” as defined in, and subject to the fiduciary responsibility provisions of, the U.S. Employee Retirement Income Security Act of 1974, as amended (“ERISA”), (b) any “plan” as defined in and subject to Section 4975 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), and (c) any entity deemed for any

 

 

 

purpose of ERISA or Section 4975 of the Code to hold "plan assets" of any such employee benefit plan or plan due to investments made in such entity by already described benefit plan investors (as determined under Section 3(42) of ERISA).

 

(o)   The Trading Fund is a “qualified eligible person” as that term is defined in CFTC Regulation 4.7.

 

(a)   Each party agrees that prior to using any promotional literature (including but not limited to pitchbooks, summary sheets or databases) in which reference to the other parties hereto is made, they shall: (i) furnish a copy of such information to each of the other parties for their consideration and approval prior to the use of such information; (ii) provide such other parties with a reasonable period within which to review and approve such promotional literature, such approval not to be unreasonably withheld or delayed; and (iii) will not make use of any promotional literature containing references to such other parties to which such other parties object, except as otherwise required by law or regulation.

(b)           The parties hereby agree that the Trading Advisor shall not be responsible for compliance with applicable law for marketing pages relating to the Aspect Series, the Aspect CS Series, the AlphaMosaic Series or the Platforms; provided however that the Trading Advisor shall be responsible for compliance with applicable law with respect to the accuracy of performance and other information with respect to the Trading Advisor and its trading strategy provided to the Sponsor by the Trading Advisor in writing for inclusion in such marketing pages.

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.

This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.  Signatures on this Agreement may be communicated by facsimile or electronic mail transmission and shall be binding upon the parties so transmitting their signatures.  Counterparts with original signatures shall be provided to the other parties following the applicable facsimile or electronic mail transmission; provided that, the failure to provide the original counterpart shall have no effect on the validity or the binding nature of this Agreement.

(a)   The Trading Advisor is authorized and regulated by the FSA.

 

(b)   The Sponsor and the Trading Fund each acknowledge and agree that:

 

(1)   no assurance, representation, warranty or guarantee has been given to the Sponsor or the Trading Fund by the Trading Advisor or any other person that the provision of services by the Trading Advisor hereunder or the Program will generate profits (or not generate losses) or that past results are indicative of future performance;

 

(2)   the Trading Advisor has classified the Trading Fund as a “Professional Client” as that term is defined in the FSA Rules and the Trading Fund will benefit from those regulatory protections afforded to that category in the FSA Rules;

 

(3)   the Trading Fund has the right to request treatment as a “Retail Client” (as that term is defined in the FSA Rules), although the Trading Advisor retains the right not to act as the discretionary investment manager for the Trading Fund in the event that the Trading Fund requests categorization as a Retail Client.

 

(c)   If any provision hereof is, or at any time becomes, illegal, invalid or unenforceable in any respect under any applicable law, such provision shall be deemed rescinded or modified to conform with such applicable law and neither the legality, validity or enforceability of the remaining provisions hereof nor the legality, validity or enforceability of such provision be affected or impaired thereby.

 

(d)   FSA-regulated business conducted by the Trading Advisor pursuant to this Agreement is covered by the Financial Services Compensation Scheme to the extent that the Trading Fund is an “eligible claimant” (as defined in the FSA Handbook).  The Financial Services Compensation Scheme compensates eligible claimants for losses suffered as a result of the inability of an FSA-regulated firm to pay monies due, or satisfy obligations owed, to them (typically as a result of the firm’s insolvency). Most types of designated investment business are covered for 100 per cent of the sum owed, to a maximum compensation of £50,000 per eligible claimant.  The Trading Fund may be an eligibl e claimant (as defined by the FSA Handbook) in relation to compensation.  Accordingly, depending on the specific circumstances of each case the Trading Fund may have a right to make a claim for compensation under the Financial Services Compensation Scheme in respect of an inability of the Trading Advisor to satisfy a claim made against it by the Trading Fund.

 

(e)   Termination of this Agreement shall be without prejudice to the completion of transactions already initiated and shall not affect the rights and obligations of the parties hereto which came into existence prior to the termination.  Such transactions shall be completed by the Trading Advisor as soon as practicable.

(f)   Save as contemplated in this Agreement, unless otherwise agreed by the parties, the Trading Advisor will not borrow on behalf of the Trading Fund or bring about transactions for the Trading Fund, such that the Trading Fund (or the Sponsor) incurs obligations as an underwriter or sub-underwriter.

(h)   When executing transactions or placing orders with other persons for execution that result from the Trading Advisor providing the discretionary investment management services on behalf of the Trading Fund, the Trading Advisor shall take all reasonable steps to obtain Best Execution in such manner as that obligation may be satisfied under the FSA Rules. “Best Execution” means, in relation to the Trading Advisor’s execution of a transaction or the placing of an order with other persons for execution that result from the Trading Advisor providing the discretionary investment management services to the Trading Fund, the best possible result for the Trading Fund in accordance with the Trading Advis or’s Execution Policy. “Execution Policy” means the Trading Advisor’s policy (as amended from time to time) for complying with the Trading Advisor’s obligation to take all reasonable steps to obtain Best Execution, a description of which is set out in Appendix E. The Trading Fund expressly consents to the Execution Policy and to the Trading Advisor’s effecting transactions on the Trading Fund’s behalf outside a Regulated Market or MTF (as those terms are defined in the FSA Handbook). Any material changes to the Execution Policy will be made available at www.aspectcapital.com/bep (or such other website as the Trading Advisor may from time to time notify to the Trading Fund) and will be notified to the Trading Fund by email no less than 21 days before those changes take effect.  Upon any such email notification, the Trading Fund will be deemed to have consented to any such material changes.  In this respect the Trading Fund represents that it has re gular access to the internet and that it has provided the Trading Advisor with an e-mail address pursuant to which the Trading Advisor shall electronically notify the Trading Fund of the information described in this Section and consents to the Trading Advisor’s providing the Trading Fund with information, including, without limitation, the Execution Policy, information concerning amendments to the Execution Policy and information about the nature and risks of investments, by posting such information at www.aspectcapital.com/bep, www.aspectcapital.com or such other website as the Trading Advisor may from time to time notify to the Trading Fund, together with an email notification that such information has been so posted.

(a)   The Trading Advisor shall provide the Sponsor as of the date of this Agreement with a list set forth under “Appendix C — List of Futures Interests,” as may be changed or updated from time to time by agreement of the Sponsor and the Trading Advisor (the “List”) of all types of Futures Interests traded by the Trading Advisor on behalf of the Trading Fund (“Products”) and the exchanges on which such Futures Interests are traded (“Exchanges”).  The Trading Advisor shall provide the Spons or with prior written notice of any Product or Exchange to be included on the List and following such notification and the Sponsor’s approval (which shall not be unreasonably withheld), such Product or Exchange shall be added to the List.

(b)   If as of any month-end while this Agreement is in effect, the Trading Fund has experienced a peak-to-valley drawdown of 35% of the Net Asset Value of the Trading Fund as of a prior month-end, the Trading Advisor shall give written notice to the Sponsor within two Business Days after such peak-to-valley drawdown.

(c)   If at any time while this Agreement is in effect, the percentage of the Trading Fund’s capital committed as margin (the “Margin Percentage”) is equal to or greater than 25%, the Sponsor shall give written notice to the Trading Advisor within two Business Days after the Margin Percentage reaches 25% and, where appropriate, shall have the right to instruct the Trading Advisor, within a reasonable amount of time, to decrease the Margin Percentage to such Margin Percentage as deemed appropriate by the Sponsor in its sole discretion.  The Trading Advisor shall comply with such instruction, and notify the Sponsor of the Trading Adviso r’s compliance, within five Business Days of receiving the instruction, or such other longer period as may be necessary under the prevailing circumstances.

(1)   The Sponsor, or such party as may be duly appointed by the Sponsor, shall determine the Trading Fund’s net asset value (“Net Asset Value”) using the following principles as communicated to the Trading Advisor.

(2)   For each Series, the net asset value of such Series will equal the value of such Series’ pro rata portion of the Trading Fund’s assets under the management of the Trading Advisor, including open positions, plus any other assets held by the Series and such Series’ pro rata portion of any other assets held by the Trading Fund, minus accrued brokerage commissions and fees.

(3)   The liquidating value of a commodity futures contract or option traded on a U.S. commodity exchange shall be based upon the settlement price on the commodity exchange on which the particular commodity futures contract or option is traded; provided that, if a contract or option cannot be liquidated on the day with respect to which net asset value is being determined, the basis for determining the liquidating value of such contract or option shall be such value as the Sponsor or its appointee may deem fair and reasonable.