Attached files
| file | filename |
|---|---|
| S-1/A - United States Commodity Index Funds Trust | v190928_s1a.htm |
| EX-8.1 - United States Commodity Index Funds Trust | v190928_ex8-1.htm |
| EX-10.1 - United States Commodity Index Funds Trust | v190928_ex10-1.htm |
| EX-10.3 - United States Commodity Index Funds Trust | v190928_ex10-3.htm |
| EX-10.2 - United States Commodity Index Funds Trust | v190928_ex10-2.htm |
| EX-23.2B - United States Commodity Index Funds Trust | v190928_ex23-2b.htm |
| EX-23.2A - United States Commodity Index Funds Trust | v190928_ex23-2a.htm |
Exhibit
10.4
ADMINISTRATIVE
AGENCY AGREEMENT
THIS ADMINISTRATIVE AGENCY
AGREEMENT (the “Agreement”) is made as of July
22, 2010 by and among BROWN
BROTHERS HARRIMAN & CO., a limited partnership organized under the
laws of the State of New York (the “Administrator”), the UNITED STATES COMMODITY FUNDS
LLC, a Delaware limited liability company (the “Sponsor”), and the UNITED STATES COMMODITY INDEX FUNDS
TRUST, a Delaware statutory trust (the “Trust”), on its own behalf and
on behalf of each series established and designated by the Trust as a fund and
listed on Annex A, including the United States Commodity Index Fund (each, a
“Fund”)
This
Agreement shall constitute a separate agreement between the Administrator, the
Sponsor, the Trust and each Fund, as if such Fund had executed a separate
Administrative Agency Agreement. The Administrator hereby acknowledges that its
rights and obligations with respect to a Fund shall not create any right or
other obligations with respect to any other Fund listed on Annex A, as amended
from time to time, and acknowledges the additional limitation on liability of
the Sponsor, Trust and the Fund described in Section 8.4 of this
Agreement. Any Fund that becomes a party hereto by executing an
amendment to this Agreement substantially in the form of Annex B (each such
amendment together with the schedules attached thereto, an “Amendment”) shall become a
party to this Agreement and any references herein to the Fund shall be treated
as references to such Fund. The obligations of the Sponsor, Trust,
the Administrator and any Fund other than United States Commodity Index Fund,
will be subject to the terms and conditions of the Amendment to this Agreement
to be entered into with that Fund.
WITNESSETH:
WHEREAS,
the Sponsor has exclusive responsibility for the management and control of the
business and affairs of the Trust and the Fund; and
WHEREAS,
the Trust and the Sponsor desire to retain the Administrator to render certain
services to the Trust, the Fund and/or the Sponsor, as the case may be, and the
Administrator is willing to render such services.
NOW, THEREFORE,
in consideration of the premises and mutual covenants herein contained, the
Administrator, the Sponsor and the Trust, on its own behalf and on behalf of the
Fund, hereby agree as follows:
1. Appointment of
Administrator. The Sponsor and the Trust hereby employ and
appoint the Administrator to act as administrative agent on the terms set forth
in this Agreement, and the Administrator accepts such appointment.
2. Delivery of
Documents. The Sponsor and the Trust, on its own behalf and on
behalf of the Fund, will on a continuing basis provide the Administrator
with:
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(a)
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properly
certified or authenticated copies of resolutions of the Sponsor’s Board of
Directors (including Mr. Nicholas D. Gerber) authorizing the appointment
of the Administrator as administrative agent of the Fund and approving
this Agreement;
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(b)
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a
copy of the Fund’s most recent registration statement under the Securities
Act of 1933, as amended;
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(c)
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copies
of all agreements between the Trust and service providers to the Fund,
including without limitation, advisory, distribution and administration
agreements and/or unitholder
agreements;
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(d)
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a
copy of the Fund’s valuation
procedures;
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(e)
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a
copy of the Trust’s constituent documents, as may be amended from time to
time;
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(f)
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a
copy of the Sponsor’s Fourth Amended and Restated Limited Liability
Company Agreement, as may be amended from time to
time;
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(g)
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any
other documents or resolutions (including, but not limited to directions
or resolutions of the Sponsor’s Board of Directors, Management Directors,
and/or Audit Committee, if applicable,) which relate to or affect the
Administrator’s performance of its duties hereunder or which the
Administrator may at any time reasonably request;
and
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(h)
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copies
of any and all amendments or supplements to the
foregoing.
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3. Duties as
Administrator. Subject to the supervision and direction of the
Sponsor’s Board of Directors, Management Directors and Audit Committee, the
Administrator will perform the administrative services described in Appendix A
hereto. Additional services may be provided by the Administrator upon
the request of the Trust or the Sponsor as mutually agreed from time to
time. In performing its duties and obligations hereunder, the
Administrator will act in accordance with the Sponsor’s instructions as defined
in Section 5 (“Instructions”). It is agreed and understood that the
Administrator shall not be responsible for compliance by the Sponsor, the Trust
or the Fund with any applicable documents, laws or regulations, or for losses,
costs or expenses arising out of a failure by the Sponsor, the Trust or the Fund
to comply with said documents, laws or regulations or the failure by or
inability of the Sponsor, the Trust or the Fund to correct any non-compliance
therewith. The Administrator shall in no event be required to take
any action, which is in contravention of any applicable law, rule or regulation
or any order or judgment of any court of competent jurisdiction.
3.1 Records. The
Administrator will maintain and retain such records as required by the
Securities Exchange Act of 1934, as amended, the NYSE Arca Equities Rules, 17
C.F.R 4.23 (specifically, the records specified in 17 C.F.R. 4.23(a)(1) through
(8), (10) through (12) and (b)(1)), and other applicable federal securities laws
and created pursuant to the performance of the Administrator’s obligations under
this Agreement. The Administrator will maintain such other records as
requested by the Trust or the Sponsor and received by the
Administrator. The Administrator shall not be responsible for the
accuracy and completeness of any records not created by the
Administrator. The Administrator acknowledges that the records
maintained and preserved by the Administrator pursuant to this Agreement are the
property of the Fund and will be, at the Fund’s expense, surrendered promptly
upon reasonable request. In performing its obligations under this
Section, the Administrator may utilize micrographic and electronic storage media
as well as independent third party storage facilities.
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4. Duties of the
Trust and the Sponsor. The Trust and the Sponsor shall notify
the Administrator promptly of any matter affecting the performance by the
Administrator of its services under this Agreement. Where the
Administrator is providing fund accounting services pursuant to this Agreement,
the Trust and the Sponsor shall promptly notify the Administrator as to the
accrual of liabilities of the Fund and of liabilities of the Fund not appearing
on the books of account kept by the Administrator, as well as to the existence,
status and proper treatment of reserves, if any, authorized by the Trust, on its
own behalf and on behalf of the Fund, or the Sponsor. The Trust, on
its own behalf and on behalf of the Fund, and the Sponsor agree to provide such
information to the Administrator as may be requested under the banking and
securities laws of the United States or other jurisdictions relating to “Know
Your Customer” and money laundering prevention rules and regulations
(collectively, the “KYC Requirements”). For purposes of this
subsection, and in connection with all applicable KYC Requirements, the Fund is
the “client” or “customer” of the Administrator. The Trust, on its
own behalf and on behalf of the Fund, and the Sponsor further represent that
each will perform all obligations required under applicable KYC Requirements
with respect to the Fund’s “customers” (as defined in the KYC Requirements) and
that, because these customers do not constitute “customers” or “clients” of the
Administrator under such applicable rules and regulations, the Administrator is
under no such similar obligations.
5. Instructions.
5.1 The
Administrator shall not be liable for, and shall be indemnified by the Fund
against any and all losses, costs, damages or expenses arising from or as a
result of, any action taken or omitted in reliance upon Instructions or upon any
other written notice, request, direction, instruction, certificate or other
instrument believed by it to be genuine and signed or authorized by the proper
party or parties. A list of persons so
authorized (“Authorized Persons”) by the Sponsor is attached hereto
as Appendix B and upon which the Administrator may rely until its receipt of
notification to the contrary from the Trust and/or the Sponsor.
5.2 Instructions
shall include a written request, direction, instruction or certification signed
or initialed by one or more Authorized Persons of the Trust and/or Sponsor, both
of which may act on behalf of the Fund.
5.3 Telephonic
or other oral instructions or instructions given by e-mail or telefax
transmission may be given by any one of the above Authorized Persons and will
also be considered Instructions if the Administrator believes them to have been
given by a person authorized to give such Instructions with respect to the
transaction involved.
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5.4 With
respect to telefax transmissions, the Trust, on its own behalf and behalf of the
Fund, and the Sponsor hereby acknowledge that (i) receipt of legible
instructions cannot be assured, (ii) the Administrator cannot verify that
authorized signatures on telefax instructions are original, and (iii) the
Administrator shall not be responsible for losses or expenses incurred through
actions taken in reliance on such telefax instructions. The Trust, on
its own behalf and on behalf of the Fund, and the Sponsor agree that such
telefax instructions shall be conclusive evidence of the Trust’s/Sponsor’s
Instruction to the Administrator to act or to omit to act.
5.5 Instructions
given orally will not be confirmed in writing and the lack of such confirmation
shall in no way affect any action taken by the Administrator in reliance upon
such oral Instructions. The Trust and the Sponsor authorize the
Administrator to tape record any and all telephonic or other oral Instructions
given to the Administrator by or on behalf of the Fund (including any of the
Sponsor’s officers, directors, trustees, employees or agents or any investment
manager or adviser or person or entity with similar responsibilities which is
authorized to give Instructions on behalf of the Fund to the
Administrator.)
6. Expenses and
Compensation. For the services to be rendered and the
facilities to be furnished by the Administrator as provided for in this
Agreement, the Sponsor and/or the Fund shall pay the Administrator rendered
pursuant to this Agreement a fee based on such fee schedule as may from time to
time be agreed upon in writing among the Sponsor, the Trust, on its own behalf
and on behalf of the Fund, and the Administrator. Additional services
performed by the Administrator on behalf of the Fund as requested by the Sponsor
or the Trust shall be subject to additional fees as mutually agreed from time to
time. In addition to any such fees, the Administrator shall bill the
Fund separately for any out-of-pocket disbursements of the Administrator based
on an out-of-pocket disbursement schedule as may from time to time be agreed
upon in writing among the Sponsor, the Trust, on its own behalf and on behalf of
the Fund, and the Administrator. The foregoing fees and disbursements
shall be billed to the Fund by the Administrator and shall be paid promptly by
wire transfer or other appropriate means by the Sponsor and/or the Fund to the
Administrator.
7. Standard of
Care. The Administrator shall be held to the exercise of
reasonable care and diligence in carrying out the provisions of this Agreement,
provided that the Administrator shall not thereby be required to take any action
which is in contravention of any applicable law, rule or regulation or any order
or judgment of any court of competent jurisdiction.
8. General
Limitations on Liability.
8.1 The
Administrator shall incur no liability with respect to any telecommunications,
equipment or power failures, or any failures to perform or delays in performance
by postal or courier services or third-party information providers (including,
without limitation those listed on Appendix C).
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8.2 The
Administrator shall also incur no liability under this Agreement if the
Administrator or any agent or entity utilized by the Administrator shall be
prevented, forbidden or delayed from performing, or omits to perform, any act or
thing which this Agreement provides shall be performed or omitted to be
performed, by reason of causes or events beyond its control, including but not
limited to:
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(i)
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any
Sovereign Event. A “Sovereign Event” shall mean any
nationalization; expropriation; devaluation; revaluation; confiscation;
seizure; cancellation; destruction; strike; act of war, terrorism,
insurrection or revolution; or any other act or event beyond the
Administrator’s control;
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(ii)
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any
provision of any present or future law, regulation or order of the United
States or any state thereof, or of any foreign country or political
subdivision thereof, or of any securities depository or clearing agency;
and
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(iii)
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any
provision of any order or judgment of any court of competent
jurisdiction.
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8.3 The
Administrator shall not be held accountable or liable for any losses, damages or
expenses the Sponsor, the Trust, the Fund, the Fund’s commodity broker, the
Fund’s commodity trading advisor (if any), any unitholder or former unitholder
of the Fund or any other person may suffer or incur arising from acts,
omissions, errors or delays of the Administrator in the performance of its
obligations and duties as provided in Section 3 hereof, including without
limitation any error of judgment or mistake of law, except a loss, damage or
expense directly resulting from the Administrator’s willful malfeasance, bad
faith or negligence in the performance of such Administrator’s obligations and
duties.
8.4 The
Administrator agrees to look solely to the assets of the Fund and to the Sponsor
and its assets in respect of any claim against or obligation of the
Fund. The Administrator acknowledges and agrees that liability of the
Fund, as a series of the Trust, is limited pursuant to Section 3804(a) of the
Delaware Statutory Trust Act, such that (a) the debts, liabilities, obligations
and expenses incurred, contracted for or otherwise existing with respect to the
Fund shall be enforceable against the assets of the Fund only, and not against
the assets of the Trust generally or the assets of any other series of the
Trust, and (b) none of the debts, liabilities, obligations and expenses
incurred, contracted for, or otherwise existing with respect to the Trust
generally and any other series of the Trust shall be enforceable against the
assets of the Fund.
9. Specific
Limitations on Liability. In addition to, and without limiting
the application of the general limitations on liability contained in Section 8,
above, the following specific limitations on the Administrator’s liability shall
apply to the particular administrative services set forth on Appendix B
hereto.
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9.1 Liability for
Fund Accounting Services. Without limiting the provisions in
Section 8 hereof, the Administrator’s liability for acts, omissions, errors or
delays relating to its fund accounting obligations and duties shall be limited
to the amount of any expenses associated with a required recalculation of net
asset value per unit (“NAV”) or any direct damages suffered by unitholders in
connection with such recalculation. The Administrator’s liability or
accountability for such acts, omissions, errors or delays shall be further
subject to clauses 9.1.1 through 9.1.4 below.
9.1.1
The parties hereto acknowledge that the Administrator’s causing an error or
delay in the determination of NAV may, but does not in and of itself, constitute
negligence or reckless or willful misconduct. The parties further
acknowledge that in accordance with industry practice the liability of the
Administrator for fund accounting services shall accrue and the recalculation of
NAV shall be performed in accordance with this Section 9.1 only with regard to
errors in the calculation of the NAV that are (i) greater than or equal to $.01
per unit of the Fund and (ii) greater than or equal to ½% of the total net
assets of the Fund.
9.1.2
In no event shall the Administrator be liable or responsible to the Sponsor, the
Trust, the Fund, the Fund’s commodity broker, the Fund’s commodity trading
advisor (if any), any present or former unitholder of the Fund, or any other
person for any error or delay that continued or was undetected after the date of
an audit performed by the certified public accountants employed by or on behalf
of the Fund if, in the exercise of reasonable care in accordance with generally
accepted accounting standards, such accountants should have become aware of such
error or delay in the course of performing such audit.
9.1.3
The Administrator shall not be held accountable or liable to the Sponsor, the
Trust, the Fund, the Fund’s commodity broker, the Fund’s commodity trading
advisor (if any), any unitholder or former unitholder of the Fund or any other
person for any delays or losses, damages or expenses any of them may suffer or
incur resulting from (i) the Administrator’s usage of a third party service
provider for the purpose of storing records delivered to the Administrator by or
on behalf of the Fund and which the Administrator did not create in the
performance of its obligations hereunder; (ii) the Administrator’s failure to
receive timely and suitable notification concerning quotations or corporate
actions relating to or affecting portfolio securities of the Fund; or (iii) any
errors in the computation of NAV based upon or arising out of quotations or
information as to corporate actions if received by the Administrator either (a)
from a source which the Administrator was authorized to rely upon (including
those sources listed on Appendix C), or (b) from a source which in the
Administrator’s reasonable judgment was as reliable a source for such quotations
or information as such authorized sources; or (iv) any errors in the computation
of NAV as a result of relevant information known to the Sponsor, the Trust, the
Fund, a futures commission merchant, securities brokers or dealers, or any of
the Fund’s other service providers including futures commission merchants in
contract with respect to the Fund, which would impact the calculation of NAV,
but was not communicated to the Administrator. To the extent that
Fund assets are not in the custody of the Administrator, the Administrator may
conclusively rely on any reporting in connection with such assets provided to
the Administrator by a third party on behalf of the Fund, including, without
limitation any futures commission merchant.
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9.1.4
In the event of any error or delay in the determination of such NAV for which
the Administrator may be liable, the Sponsor and the Administrator will consult
and make good faith efforts to reach agreement on what actions should be taken
in order to mitigate any loss suffered by the Fund or its present or former
unitholders, in order that the Administrator’s exposure to liability shall be
reduced to the extent possible after taking into account all relevant factors
and alternatives. It is understood that in attempting to reach
agreement on the actions to be taken or the amount of the loss which should
appropriately be borne by the Administrator, the Sponsor, the Fund and the
Administrator will consider such relevant factors as the amount of the loss
involved, the Fund’s/Sponsor’s desire to avoid loss of unitholder goodwill, the
fact that other persons or entities could have been reasonably expected to have
detected the error sooner than the time it was actually discovered, the
appropriateness of limiting or eliminating the benefit which unitholders or
former unitholders might have obtained by reason of the error, and the
possibility that other parties providing services to the Fund might be induced
to absorb a portion of the loss incurred.
10.
Indemnification.
10.1 The
Sponsor and the Fund hereby agree to indemnify and hold harmless the
Administrator, its partners, stockholders, members, directors, officers and
employees and any subsidiary or affiliate of the foregoing (“Affiliate”), and
the successors and assigns of all of the foregoing persons, against any and all
losses, claims, damages, liabilities or expenses (including reasonable counsel
fees and expenses) resulting from any act, omission, error or delay or any
claim, demand, action or suit, in connection with or arising out of performance
of its obligations and duties under this Agreement, not resulting from the
willful malfeasance, bad faith or negligence of the Administrator in the
performance of such obligations and duties. The provisions of this
Section 10 shall survive the termination of this Agreement.
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10.1.1
If any action, suit or proceeding (each, a “Proceeding”) is brought against the
Administrator or any such person in respect of which indemnity may be sought
against the Sponsor pursuant to the foregoing subsection, the Administrator or
such person shall promptly notify the Sponsor in writing of the institution of
such Proceeding and the Sponsor shall assume the defense of such Proceeding,
including the employment of counsel reasonably satisfactory to such indemnified
party and payment of all fees and expenses; provided, however, that the omission
to so notify the Sponsor shall not release the Sponsor from any liability which
it may have to the Administrator or any such person except to the extent that it
has been materially prejudiced by such failure and has not otherwise learned of
such Proceeding. The Administrator or such person shall have the right to employ
its own counsel in any such case, but the fees and expenses of such counsel
shall be at the expense of the Administrator or of such person unless the
employment of such counsel shall have been authorized in writing by the Sponsor
in connection with the defense of such Proceeding or the Sponsor shall not have,
within a reasonable period of time in light of the circumstances, employed
counsel to have charge of the defense of such Proceeding or such indemnified
party or parties shall have reasonably concluded that there may be defenses
available to it or them which are different from, additional to or in conflict
with those available to the Sponsor (in which case the Sponsor shall not have
the right to direct the defense of such Proceeding on behalf of the indemnified
party or parties), in any of which events such fees and expenses shall be borne
by the Sponsor and paid as incurred (it being understood, however, that the
Sponsor shall not be liable for the expenses of more than one separate counsel
(in addition to any local counsel) in any one Proceeding or series of related
Proceedings in the same jurisdiction representing the indemnified parties who
are parties to such Proceeding).
10.1.2
The Sponsor shall not be liable for any settlement of any Proceeding effected
without the Sponsor’s written consent but if settled with the Sponsor’s written
consent, the Sponsor agrees to indemnify and hold harmless the Administrator and
any such person from and against any loss or liability by reason of such
settlement. Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by the second
sentence of this subsection, then the indemnifying party agrees that it shall be
liable for any settlement of any Proceeding effected without its written consent
if (i) such settlement is entered into more than 60 Business Days (defined as
any day other than a day when any of the Futures Exchanges upon which a
Benchmark Component Futures Contract is traded is closed for regular
trading1
(each a “Business Day”)), after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall not have fully reimbursed
the indemnified party in accordance with such request prior to the date of such
settlement and (iii) such indemnified party shall have given the indemnifying
party at least 30 Business Days’ prior notice of its intention to settle. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened Proceeding in respect
of which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all liability
on claims that are the subject matter of such Proceeding and does not include an
admission of fault, culpability or a failure to act, by or on behalf of such
indemnified party.
1 “Futures
Exchanges” shall include the New York Mercantile Exchange (“NYMEX”), ICE Futures
(“ICE”), Chicago Board of Trade (“CBOT”), Chicago Mercantile Exchange (“CME”),
London Metal Exchange (“LME”), Commodity Exchange, Inc. (“COMEX”) or other
foreign exchanges (such exchanges, collectively, the “Futures Exchanges”).
“Benchmark Component Futures Contract” shall mean the Futures Contracts that at
any given time make up the index of the Fund.
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10.2 Subject
to Sections 7, 8 and 9 of this Agreement, the Administrator agrees to indemnify
and hold harmless the Sponsor, the Trust, the Fund, and their respective
partners, stockholders, members, directors, officers, trustees and employees and
any Affiliate of the foregoing, and the successors and assigns of all of the
foregoing persons, against any and all losses, claims, damages, liabilities or
expenses (including reasonable counsel fees and expenses) resulting from any
act, omission, error or delay or any claim, demand, action or suit, in
connection with or arising out of performance of its obligations and duties
under this Agreement, resulting from the willful malfeasance, bad faith or
negligence of the Administrator in the performance of such obligations and
duties. The provisions of this Section 10 shall survive the
termination of this Agreement.
10.2.1
If any Proceeding is brought against the Sponsor, the Trust, the Fund or any
such person in respect of which indemnity may be sought against the
Administrator pursuant to the foregoing subsection, the Sponsor, the Trust, the
Fund or such person shall promptly notify the Administrator in writing of the
institution of such Proceeding and the Administrator shall assume the defense of
such Proceeding, including the employment of counsel reasonably satisfactory to
such indemnified party and payment of all fees and expenses; provided, however,
that the omission to so notify the Administrator shall not relieve the
Administrator from any liability which it may have to the Sponsor, the Trust,
the Fund or any such person except to the extent that it has been materially
prejudiced by such failure and has not otherwise learned of such Proceeding. The
Sponsor, the Trust, the Fund or such person shall have the right to employ its
own counsel in any such case, but the fees and expenses of such counsel shall be
at the expense of the Sponsor, the Trust, the Fund or of such person unless the
employment of such counsel shall have been authorized in writing by the
Administrator in connection with the defense of such Proceeding or the
Administrator shall not have, within a reasonable period of time in light of the
circumstances, employed counsel to have charge of the defense of such Proceeding
or such indemnified party or parties shall have reasonably concluded that there
may be defenses available to it or them which are different from, additional to
or in conflict with those available to the Administrator (in which case the
Sponsor shall not have the right to direct the defense of such Proceeding on
behalf of the indemnified party or parties), in any of which events such fees
and expenses shall be borne by the Administrator and paid as incurred (it being
understood, however, that the Administrator shall not be liable for the expenses
of more than one separate counsel (in addition to any local counsel) in any one
Proceeding or series of related Proceedings in the same jurisdiction
representing the indemnified parties who are parties to such
Proceeding).
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10.2.2
The Administrator shall not be liable for any settlement of any Proceeding
effected without the Administrator’s written consent but if settled with the
Administrator’s written consent, the Administrator agrees to indemnify and hold
harmless the Sponsor and any such person from and against any loss or liability
by reason of such settlement. Notwithstanding the foregoing sentence,
if at any time an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for fees and expenses of counsel as
contemplated by the second sentence of this subsection, then the indemnifying
party agrees that it shall be liable for any settlement of any Proceeding
effected without its written consent if (i) such settlement is entered into more
than 60 Business Days after receipt by such indemnifying party of the aforesaid
request, (ii) such indemnifying party shall not have fully reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement and (iii) such indemnified party shall have given the indemnifying
party at least 30 Business Days’ prior notice of its intention to settle. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened Proceeding in respect
of which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all liability
on claims that are the subject matter of such Proceeding and does not include an
admission of fault, culpability or a failure to act, by or on behalf of such
indemnified party.
11. Reliance by the
Administrator on Opinions of Counsel and Opinions of Certified Public
Accountants.
The
Administrator may consult with its counsel or the counsel of the Sponsor, the
Trust or the Fund in any case where so doing appears to the Administrator to be
necessary or desirable. The Administrator shall not be considered to
have engaged in any misconduct or to have acted negligently and shall be without
liability in acting upon the advice of its counsel or of the counsel of the
Sponsor, the Trust or the Fund.
The
Administrator may consult with a certified public accountant or the Fund’s
Treasurer (or persons performing such function) in any case where so doing
appears to the Administrator to be necessary or desirable. The
Administrator shall not be considered to have engaged in any misconduct or to
have acted negligently and shall be without liability in acting upon the advice
of such certified public accountant or of the Fund’s Treasurer or persons
performing such function.
12. Termination of
Agreement. This Agreement may be terminated by any of the
parties in accordance with the provisions of this Section
12. Termination of this Agreement with respect to any Fund shall not
result in the termination of this Agreement with respect to any other Fund
listed on Annex A.
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12.1 This
Agreement shall have an initial term of two (2) years from the date hereof.
Thereafter, this Agreement shall automatically renew for successive one (1) year
periods unless any party terminates this Agreement by providing written notice
no later than seventy-five (75) days prior to the expiration of the applicable
term to the other parties at their address set forth herein. Upon the
completion of the initial term, either the Administrator, on the one hand, or
the Sponsor, on the other hand, may elect to terminate this Agreement at any
time by delivering ninety (90) days notice thereof to the other
party. Notwithstanding the foregoing provisions, any party may
terminate this Agreement at any time (a) for cause, which is a material breach
of the Agreement not cured within sixty (60) days of written notice of such
breach, in which case termination shall be effective upon receipt of written
notice by the non-terminating parties, or (b) upon thirty (30) days’ written
notice to the other parties in the event that a party is adjudged bankrupt or
insolvent, or there shall be commenced against such party a case under any
applicable bankruptcy, insolvency, or other similar law now or hereafter in
effect. In the event a termination notice is given by a party hereto, all
expenses associated with the movement of records and materials and the
conversion thereof shall be paid by the Fund for which services shall cease to
be performed hereunder. The Administrator shall be responsible for
completing all actions in progress when such termination notice is given unless
otherwise agreed.
12.2 Upon
termination of this Agreement in accordance with this Section 12, the Sponsor
may request the Administrator to promptly deliver to the Fund or to any
designated third party all records created and maintained by the Administrator
pursuant to Section 3.1 of this Agreement, as well as any Fund records
maintained but not created by the Administrator. If such request is
provided in writing by the Sponsor to the Administrator within seventy-five (75)
days of the date of termination of the Agreement, the Administrator shall
provide to the Fund a certification that all records created by the
Administrator pursuant to its obligations under Section 3.1 of this Agreement
are accurate and complete. After seventy-five (75) days of the date
of termination of this Agreement, no such certification will be provided to the
Sponsor by the Administrator and the Administrator is under no further
obligation to ensure that records created by the Administrator pursuant to
Section 3.1 of this Agreement are maintained in a form that is accurate or
complete.
13. Confidentiality
and Privacy.
13.1 The
parties hereto agree that each shall treat confidentially the terms and
conditions of this Agreement and all information provided by each party to the
other regarding its business and operations. All confidential
information provided by a party hereto shall be used by any other party hereto
solely for the purpose of rendering or obtaining services pursuant to this
Agreement and, except as may be required in carrying out this Agreement, shall
not be disclosed to any third party without the prior consent of such providing
party. The foregoing shall not be applicable to any information that
is publicly available when provided or thereafter becomes publicly available
other than through a breach of this Agreement, or that is required to be
disclosed by or to any regulatory authority, any auditor of the parties hereto,
or by judicial or administrative process or otherwise by applicable
law.
13.2 In
the course of carrying out its obligations under this Agreement, Administrator
shall maintain physical, procedural and electronic safeguards to protect
information regarding the Fund and its investors that Administrator has obtained
or to which the Administrator has gained access.
11
14. Tape-recording. The
parties consent to recording of any and all telephonic or other oral
instructions. This authorization will remain in effect until and
unless revoked by the Fund, the Sponsor or the Administrator in
writing. Each party further agrees to solicit valid written or other
consent from any of its employees, officers, directors or agents with respect to
telephone communications to the extent such consent is required by applicable
law.
15. Procedures. Procedures
applicable to the Administrator’s services to be performed hereunder may be
established from time to time by agreement among the Trust on its own behalf and
on behalf of the Fund, the Sponsor and the Administrator. The
Administrator shall have the right to utilize any unitholder accounting and
record¬keeping systems that, in its opinion, enables it to perform any services
to be performed hereunder.
16. Entire Agreement;
Amendment. This Agreement constitutes the entire understanding
and agreement of the parties hereto and supersedes any other oral or written
agreements heretofore in effect between the parties with respect to the subject
matter hereof. No provision of this Agreement may be amended or
terminated except by a statement in writing signed by the party against which
enforcement of the amendment or termination is sought.
17. Severability. In
the event any provision of this Agreement is determined to be void or
unenforceable, such determination shall not affect the remainder of this
Agreement, which shall continue to be in force.
18. Headings. The
section headings in this Agreement are for the convenience of reference only and
shall not modify, define, expand or limit any of the terms or provisions
thereof.
19. Governing
Law. This Agreement shall be governed by and construed
according to the laws of the State of New York without giving effect to
conflicts of law provisions thereof and each of the parties hereto irrevocably
consents to the exclusive jurisdiction of the United States District Court for
the Southern District of New York or if that court lacks or declines to exercise
subject matter jurisdiction, the Supreme Court of the State of New York, New
York County. The Sponsor and the Trust on its own behalf and on
behalf of the Fund irrevocably waive any objection each may now or hereafter
have to the laying of venue of any action or proceeding in any of the aforesaid
courts and any claim that any such action or proceeding has been brought in an
inconvenient forum. Furthermore, each party hereto irrevocably waives
any right that it may have to trial by jury in any action, proceeding or
counterclaim arising out of or related to this Agreement or the services
contemplated hereby.
20. Notices. Notices
and other writings delivered or mailed postage prepaid to the Sponsor, the Trust
and the Fund shall be addressed to the Sponsor or to the Trust or the Fund c/o
Sponsor at United States Commodity Funds LLC, 1320 Harbor Bay Parkway, Suite
145, Alameda, California 94502, Attention: Nicholas D. Gerber, or such other
address as the Sponsor or the Trust may have designated to the Administrator in
writing, or to the Administrator at 40 Water Street, Boston,
MA 02109, Attention: Manager, Fund Administration Department, or to
such other address as the Administrator may have designated to the Sponsor and
the Trust in writing, shall be deemed to have been properly delivered or given
hereunder to the respective addressee.
12
21. Binding Effect;
Assignment. This Agreement shall be binding upon and inure to
the benefit of the Sponsor, the Trust, the Fund and the Administrator and their
respective successors and assigns, provided that no party hereto may assign this
Agreement or any of its rights or obligations hereunder without the written
consent of the other parties. Each party agrees that only the parties
to this Agreement and Fund and/or their respective successors in interest shall
have a right to enforce the terms of this Agreement. Accordingly, no
client of the Sponsor, unitholder of the Fund or other third party shall have
any rights under this Agreement and such rights are explicitly disclaimed by the
parties.
22. Counterparts. This
Agreement may be executed in any number of counterparts each of which shall be
deemed to be an original. This Agreement shall become effective when
one or more counterparts have been signed and delivered by each of the
parties. A photocopy or telefax of this Agreement shall be acceptable
evidence of the existence of this Agreement and the Administrator shall be
protected in relying on the photocopy or telefax until the Administrator has
received the original of this Agreement.
23. Exclusivity. The
services furnished by the Administrator hereunder are not to be deemed
exclusive, and the Administrator shall be free to furnish similar services to
others.
24.
Authorization. The
Sponsor hereby represents, warrants and covenants that it is, and will continue
to be until the termination of this Agreement, duly authorized to enter into
this Agreement on behalf of the Trust and the Fund, to bind the Trust and the
Fund in connection with all obligations hereunder, and to otherwise perform the
terms herein. The Sponsor hereby further represents and warrants that
the Management Directors of its Board of Directors including Mr. Nicholas D.
Gerber have authorized the execution and delivery of this Agreement and that
Authorized Persons of the Sponsor and the Trust, on its own behalf and on behalf
of the Fund, have signed this Agreement, Appendices A, B and C and the fee
schedule hereto.
13
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered as of the date first written above.
BROWN
BROTHERS HARRIMAN & CO.
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By:
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Name:
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Title:
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Date:
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UNITED
STATES COMMODITY FUNDS LLC
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By:
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Name:
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||
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Title:
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Date:
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UNITED
STATES COMMODITY INDEX FUNDS TRUST, on its own behalf and on behalf of the
United States Commodity Index Fund
| By: | United States Commodity Funds LLC, as Sponsor | |||
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By:
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Name:
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Title:
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Date:
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14
APPENDIX
A
TO
ADMINISTRATIVE AGENCY AGREEMENT
ADMINISTRATIVE
SERVICES OF THE ADMINISTRATIVE AGENT
Dated as
of July 22, 2010
Fund
Accounting Services
The
Administrator will provide the following fund accounting services to the Fund on
any Business Day: transaction processing and review, custodial reconciliation,
securities pricing and investment accounting.
Transaction Processing and
Review. The Administrator shall input and reconcile the Fund’s investment
activity including with respect to:
|
•
|
Investment
taxlots
|
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•
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Income
|
|
•
|
Dividends
|
|
•
|
Principal
paydowns
|
|
•
|
Capital
activity
|
|
•
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Expense
accruals
|
|
•
|
Cash
activity
|
|
•
|
Corporate
Reorganizations
|
Custodial
Reconciliation. The Administrator shall reconcile the following positions
of the Fund against the records of the Custodian:
|
•
|
Securities,
Futures and Over-the-Counter Contract (“OTC”)
holdings
|
|
•
|
Cash
including cash transfers, fees assessed and other investment related cash
transactions
|
|
•
|
Trade
settlements
|
Securities, Futures and OTC
Valuation. Using the Valuation Procedures set forth in Appendix D, the
Administrator shall update each security, Futures and OTC position of the Fund
as to the following:
|
•
|
Market
prices obtained from approved sources including those listed on Appendix C
or Fair Valuations obtained from an Authorized Person of the
Fund
|
|
•
|
Mark
to market of non-base receivables/payables utilizing approved foreign
exchange quotations as quoted in Appendix
C
|
|
•
|
Mark
to market of non-base currency positions utilizing the approved sources
quoted in Appendix C or Fair Valuations obtained from an Authorized Person
of the Fund
|
Investment
Accounting. The Administrator shall provide the following investment
accounting services to each Portfolio:
|
•
|
Amortization/accretion
at the individual tax lot level
|
|
•
|
General
ledger entries
|
|
•
|
Book
value calculations
|
|
•
|
Trade
Date + 1 accounting
|
15
|
•
|
Calculation
of Net Asset Value Per Unit (“NAV”) as of the earlier of 4:00 p.m. New
York time or the close of trading on the NYSE Arca, and published shortly
after the close of trading on the NYSE
Arca
|
NAV Reporting. The
Administrator shall communicate the Fund’s exchange-traded product (“ETP”) net
asset value information with respect to:
|
•
|
PLF
A (ETP NAV summary data including Fund Net Assets, NAV/share,
NAV/creation, Basket market value (if applicable), actual cash component
(if applicable), and estimated cash component (if applicable)) if required
by NSCC, the Exchange, or the Fund’s
Distributor
|
|
•
|
ETP
Fund Holding File/Report to the Fund’s Distributor for the purpose of
updating the USCF website
|
|
•
|
ETP
Fund holdings and/or NAV data when authorized to provide this to third
parties such as the ICI, Morningstar, or
Lipper
|
Financial
Reporting Services
|
•
|
The
Administrator shall accumulate information for and
prepare:
|
|
|
o
|
Within
a 30 day period following the end of the Fund’s required monthly reporting
period, an Account Statement in compliance with the requirements of CFTC
Rule §4.22(a), including a Statement of Income (Loss) and a Statement of
Changes in Net Asset Value; such preparation includes the distribution of
drafts to the Sponsor and Board of Directors for review and
comment.
|
|
|
o
|
Upon
review and approval of each above-mentioned report by the Sponsor’s
Treasurer and/or Chief Financial Officer (or such person performing such
functions), the Administrator shall file such reports with the SEC,
including any applicable executive officer certifications or other
exhibits to such reports and coordinate with the distributor to post such
report to the fund’s website.
|
|
|
o
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Within
90 days after the end of the Fund’s fiscal year, an Annual Report of the
Fund in compliance with the requirements of the NFA and CFTC Rule
§4.22(c); such preparation includes the coordination of all printer and
author edits and the review of printer drafts. The Fund and/or
Sponsor shall make arrangements for the printing and mailing of the Annual
Report.
|
|
•
|
Upon
review and approval of each above-mentioned report by the Sponsor’s
Treasurer and/or Chief Financial Officer (or such person performing such
functions), the Administrator shall file such reports with the CFTC and/or
NFA as required, including any applicable executive officer certifications
or other exhibits to such reports.
|
|
•
|
In
connection with the preparation of each Annual Report on Form 10-K, the
Administrator shall coordinate the audit of the Fund by its independent
public accountant (e.g., manage open items lists, host weekly audit
meeting, etc.).
|
Assistant
Treasurer Services
The
Administrator shall perform the following services as requested by the Sponsor’s
Treasurer (or person performing such function):
|
•
|
Provide
consultative services with respect to financial matters of the Fund as may
be requested and agreed to among the Fund, the Sponsor and the
Administrator from time to time
|
16
Corporate
Secretarial Services
The
Administrator shall perform the following secretarial services:
|
•
|
Maintain
a calendar for Board and Audit Committee matters/approvals in a form to be
agreed upon by the parties from time to
time
|
|
•
|
Prepare
quarterly Board and Audit Committee meeting materials, including notices,
scripts, agendas, resolutions, memoranda, minutes, and mail the materials
to the Board and such other persons as instructed by the
Sponsor
|
|
•
|
Attend
quarterly Board and Audit Committee meetings, take minutes of the
meetings, make presentations as required and follow up on matters raised
at the meetings. In the event that the Administrator is asked
to perform corporate secretarial services for more than four quarterly
Board or Audit Committee meetings per calendar year, the Fund will be
assessed special meeting fees. Fees may range between $2,500 and $10,000
per meeting, depending upon the complexity of the meeting materials and
discussion and the location of the meeting. Out-of-pocket
expenses associated with the production and mailing of all Board and Audit
Committee meeting materials, as well as travel expenses associated with
in-person attendance at meetings, will be charged to the
Fund
|
|
•
|
Prepare
the annual directors and officers questionnaires and distribute the
questionnaires to the directors and officers of the
Sponsor
|
Regulatory
Support Services
The
Administrator shall perform the following regulatory services for the
Fund:
|
•
|
Maintain
a calendar for all SEC, CFTC, NFA and NYSE Arca regulatory matters in the
form of Exhibit
A; provided that the Fund and/or Sponsor shall notify the
Administrator of additional regulatory matters to be added to such
calendar as soon as practicable.
|
|
•
|
Within
a 45 day production cycle, or shorter time period as required by the U.S.
Securities and Exchange Commission (the “SEC”) and communicated
to the Administrator by the Fund and/or the Sponsor, one first fiscal
quarter report of the Fund, one second fiscal quarter report of the Fund
and one third fiscal quarter report of the Fund, each on Form
10-Q.
|
|
•
|
Within
a 90 day production cycle, or shorter time period as required by the SEC
and communicated to the Administrator by the Fund and/or Sponsor, one
annual report of the Fund on Form 10-K per fiscal year. The
preparation of the Form 10-K includes the coordination of all printer and
author edits and the review of printer
drafts.
|
Upon
review and approval of each above-mentioned report by the Sponsor’s Treasurer
and/or Chief Financial Officer (or such person performing such functions), the
Administrator shall Edgarize and file, or cause to be Edgarized and filed, such
reports with the SEC, CFTC and/or NFA as required, including any applicable
executive officer certifications or other exhibits to such reports.
The
Administrator shall perform the following additional regulatory services for the
Fund:
|
•
|
Prepare
the materials for and attend one unitholder meeting per calendar year
(including preparation of the proxy statement, notice and other
solicitation materials and filing such materials with the SEC and taking
minutes of the meeting), at the Fund’s
request
|
17
|
•
|
Coordinate
with the Fund’s transfer agent or solicitor in monitoring the unitholder
vote solicitation and tabulation for one unitholder meeting per calendar
year, at the Fund’s request
|
|
•
|
Prepare
and file, or cause to be filed, the following regulatory
notices/forms/reports:
|
|
|
o
|
With
the SEC, Forms 3, 4 and 5 and Schedules 13D and 13G for the officers and
directors of the Sponsor and such other persons as requested by the
Fund
|
|
|
o
|
With
the SEC, Current Reports on Form 8-K as circumstances
warrant.
|
|
|
o
|
With
the NYSE Arca, such notices/forms as agreed to among the Fund, the Sponsor
and the Administrator
|
The
Administrator shall assist the Fund and/or the Sponsor in preparing Fund press
releases with respect to interim statements and quarterly results and
transmitting such press releases to the NYSE Arca and such other entities as
requested by the Fund or the Sponsor.
Transfer
Agency Services
The
Administrator shall perform the following transfer agency services:
I. Issuance and Redemption of
Fund Units. It is agreed and understood that the Fund, and the
Administrator on the Fund’s behalf, shall issue and redeem Units of the Fund in
blocks of 100,000 Units (“Creation Baskets” and “Redemption Baskets,”
respectively) to and from such persons as are identified by the Fund as
“Authorized Purchasers” or “Authorized Participants.”
A. Pursuant
to such purchase orders that the Administrator as the Index Receipt Agent shall
receive from the ALPS Distributors, Inc. (“Marketing Agent”) and pursuant to the
procedures set forth in the Authorized Purchaser Agreement entered into by the
Fund, Administrator shall transfer appropriate trade instructions to the Fund’s
custodian, Brown Brothers Harriman & Co. (“Custodian”) and pursuant to such
orders register the appropriate number of book entry only Fund Units in the name
of The Depository Trust Company (“DTC”) or its nominee as a unitholder (each a
“Unitholder”) of the Fund and deliver the Units of the Fund on the
business.
B. Pursuant
to such redemption orders that Index Receipt Agent shall receive from the
Marketing Agent, pursuant to the procedures set forth in the Authorized
Purchaser Agreement entered into by the Fund, Administrator shall transfer
appropriate trade instructions to the Custodian and, pursuant to such orders,
redeem the appropriate number of Fund Units that are delivered to the designated
DTC Participant Account of the Custodian for redemption and debit such Units
from the account of the Unitholder on the register of the Fund.
C. On
behalf of the Fund, Administrator shall issue Fund Units in Creation Baskets for
settlement with purchasers through DTC as the purchaser is authorized to
receive. Beneficial ownership of Fund Units shall be shown on the records of DTC
and DTC Participants and not on any records maintained by the
Administrator. In issuing Fund Units through DTC to a purchaser,
Administrator shall be entitled to rely upon the latest Instructions that are
received from the Marketing Agent by the Administrator as Index Receipt Agent
concerning the issuance and delivery of such Units for
settlement.
18
D. Administrator
shall not issue on behalf of the Fund any Fund Units where it has received an
Instruction from the Fund, the Sponsor or the Marketing Agent or written
notification from any federal or state authority that the sale of the Fund Units
has been suspended or discontinued, and Administrator shall be entitled to rely
upon such Instructions or written notification.
E. Upon
the issuance of Fund Units as provided herein, Administrator shall not be
responsible for the payment of any original issue or other taxes, if any,
required to be paid by the Fund, the Sponsor or the Marketing Agent in
connection with such issuance.
F. Fund
Units may be redeemed in accordance with the procedures set forth in the
relevant Authorized Purchaser Agreement and Administrator shall duly process all
redemption requests.
G. Administrator
will act only upon Instruction from the Fund and/or the Sponsor in addressing
any failure in the delivery of cash, treasuries and/or Shares in connection with
the issuance and redemption of Fund Units.
II. Payment of Dividends and
Distributions on Fund Units.
A. As
instructed by the Fund and/or the Sponsor, the Administrator shall prepare and
make payments for dividends and distributions declared by the Fund or the
Sponsor.
B. The
Fund and/or the Sponsor shall promptly notify the Administrator of the
declaration of any dividend or distribution. The Fund and/or the
Sponsor shall furnish to the Administrator a statement signed by an Authorized
Person: (i) indicating that dividends have been declared on a specific periodic
basis and Instructions specifying the date of the declaration of such dividend
or distribution, the date of payment thereof, the record date as of which
unitholders shall be entitled to payment, the total amount payable to the
unitholders and the total amount payable to Administrator as transfer agent on
the payment date; or (ii) setting forth the date of the declaration of any
dividend or distribution, the date of payment thereof, the record date as of
which the unitholders are entitled to payment, and the amount payable per unit
to each unitholder as of that date and the total amount payable to Administrator
as transfer agent on the payment date.
C. Based
upon the amount of Fund Units outstanding on its books and records, the Fund
and/or the Sponsor shall calculate the total dollar amount of the dividend or
distribution and notify the Administrator of this amount. The Fund
and/or the Sponsor shall then instruct the Administrator to direct the Custodian
to place in a separate cash account maintained by the Administrator funds equal
to the total cash amount of the dividend or distribution to be paid
out. Should the Custodian determine that it does not have sufficient
cash in the Custody Account to pay the total amount of the dividend or
distribution to the Administrator, the Administrator shall advise the Fund
and/or the Sponsor and the Fund and/or the Sponsor shall either adjust the rate
of the dividend or distribution or provide additional cash directly to the
Custodian for credit to the separate cash account maintained by the
Custodian. When instructed by the Fund and/or the Sponsor, the
Administrator shall direct the Custodian to make payment of such dividend or
distribution to the account of each unitholder.
19
D. Should
the Administrator or the Custodian not receive from the Fund sufficient cash to
make payment as provided in the immediately preceding Subsection, the
Administrator shall notify the Fund and/or the Sponsor, and the Administrator
shall withhold payment to the unitholders until sufficient cash is provided to
the Custodian and the Administrator shall not be liable for any claim arising
out of such withholding.
|
III.
|
Maintenance of
Registry of Limited Partners and Persons Applying to Become Limited
Partners.
|
Pursuant
to the Trust Agreement for the Fund, all purchasers of Units who wish to become
record holders and receive cash distributions (if any) must deliver an executed
transfer application in which the purchaser or transferee must certify that,
among other things, he/she agrees to be bound by the Fund’s Trust Agreement and
is eligible to purchase the Fund’s securities. Any transfer of Units
will not be recorded by the transfer agent unless a completed transfer
application is delivered to the Sponsor or the Administrator.
The
Administrator shall keep a record of all transfer applications received, with
each applicant deemed as a holder of record until the application is approved by
the Fund. All applications will be forwarded by the Administrator to
the Sponsor to obtain its consent. Once such consent is obtained, the
holder shall become a Limited Partner. The Administrator shall
maintain a registry of all Limited Partners and holders of record of the
Fund.
|
IV.
|
Recordkeeping.
|
A. The
Administrator shall record the issuance of Fund Creation Baskets and maintain,
pursuant to Rule 17Ad 6(b) under the Securities Exchange Act of 1934, as
amended, a record of the total number of Fund Creation Baskets that are
authorized, issued and outstanding based upon data provided to Administrator by
the Fund and/or the Sponsor. The Administrator shall also provide the
Fund and/or the Sponsor on a regular basis with the total number of Fund Units
authorized, issued and outstanding; provided however that the Administrator
shall not be responsible for monitoring the issuance of such Units or compliance
with any laws relating to the validity of the issuance or the legality of the
sale of such Units.
20
APPENDIX
B TO THE
ADMINISTRATIVE
AGENCY AGREEMENT
List
of Authorized Persons
UNITED
STATES COMMODITY FUNDS LLC
|
By:
|
|
|
|
Name:
|
||
|
Title:
|
||
|
Date:
|
UNITED
STATES COMMODITY INDEX FUNDS TRUST, on its own behalf and on behalf of the
United States Commodity Index Fund
| By: | United States Commodity Funds LLC, as Sponsor | |||
|
|
By:
|
|||
|
|
Name:
|
|||
|
|
Title:
|
|||
|
|
Date:
|
|||
21
APPENDIX
C TO THE
ADMINISTRATIVE
AGENCY AGREEMENT
AUTHORIZED
SOURCES
TheThe
Sponsor and the Trust hereby acknowledge that the Administrator is authorized to
use the following authorized sources for financial reporting, pricing (including
corporate actions, dividends and rights offering), and foreign exchange
quotations, to assist it in fulfilling its obligations under the aforementioned
Agreement.
BLOOMBERG
RUSSELL/MELLON
FUND
MANAGERS / CLIENT DIRECTED
INTERACTIVE
DATA CORPORATION
REPUTABLE
BROKERS
THOMSON
REUTERS
SUBCUSTODIAN
BANKS
SIX
TELEKURS
REPUTABLE
FINANCIAL PUBLICATIONS
STOCK
EXCHANGES
STAT
PRO
MORGAN
STANLEY CAPITAL INTERNATIONAL
WALL
STREET OFFICE
PRICING
DIRECT
MARKIT
SUPER
DERIVATIVES
S&P
DOW
JONES
JP MORGAN
– contract pending
SQX
(SECURITIES QUOTE EXCHANGE) – contract pending
BARCLAYS
– contract pending
MONIS-JEFFRIES
FITCH
SOLUTIONS
MOODYS
FORD
EQUITY RESEARCH
FTSE
GROUP
INVESTMENT
TECHNOLOGY GROUP (ITG)
22
|
BROWN
BROTHERS HARRIMAN & CO.
|
||
|
By:
|
|
|
|
Name:
|
||
|
Title:
|
||
|
Date:
|
||
|
UNITED
STATES COMMODITY FUNDS LLC
|
||
|
By:
|
|
|
|
Name:
|
||
|
Title:
|
||
|
Date:
|
||
UNITED
STATES COMMODITY INDEX FUNDS TRUST, on its own behalf and on behalf of the
United States Commodity Index Fund
| By: | United States Commodity Funds LLC, as Sponsor | |||
|
|
By:
|
|||
|
|
Name:
|
|||
|
|
Title:
|
|||
|
|
Date:
|
|||
23
APPENDIX
D
BBH
Pricing Policies
Futures,
Forwards, Swaps, Options and Treasuries
The
pricing policies stated below are used for all BBH clients, including Mutual
Fund Registered Investment Companies. These policies have been
audited by numerous accounting firms during annual fund audits.
Futures
Futures
traded on exchanges are valued using the closing settlement prices quoted on the
relevant exchange and obtained from pricing sources, typically Bloomberg or
Reuters.
Forward
Currency Contracts
BBH
obtains the WM Reuters London Close closing spot rates and the WM Reuters London
Close forward point rates on a daily basis. The currency forward
contract pricing model derives the differential in point rates to the expiration
date of the forward and calculates its present value. The forward is
valued at the net of the present value and the spot rate.
Swaps
Swaps and
other similar derivative or contractual type instruments are valued at a price
provided by a single broker or dealer, typically the counterparty. If no such
price is available, the contract is valued at a price at which the counterparty
to such contract would repurchase the instrument or terminate the
contract.
Options
Option
contracts on securities, currencies, indices, futures contracts, commodities and
other instruments shall be valued at the last sale price on the exchange or
market that is the Primary Market. If a contract did not trade on the
Primary Market, it shall be valued at the last sale price on another exchange or
market where it did trade. If there is no such sale price, the
value shall be the most recent bid quotation.
Sale
prices and bid quotations indicated above shall be supplied by a Pricing Service
(Reuters, Bloomberg, IDC, etc.). If a Pricing Service is not able to provide
such sale prices or bid quotations, the value shall be determined by taking the
mean between the bid and the asked quotations provided by a single broker or
dealer, unless the broker or dealer can only provide a bid quotation, in which
case the value shall be such bid quotation.
Except as
provided below, OTC currency options are valued by uploading the applicable
implied volatility rates from Reuters or Bloomberg. Other inputs are
either uploaded (interest rates, spots) or are specified when the ticker symbols
are set up (expiration date, strike). OTC currency options are then
priced by using the Garman-Kohlhagen modified Black-Scholes formula, which
adjusts for a constant yield versus a fixed dividend.
Except as
provided below, OTC equity/index options are priced according to the contract
specifications (days to expiration, current spot index level, interest rates,
dividends, strike price) using the Black-Scholes pricing model, modified for
dividends. The volatility input assumption is interpolated from the
previous day’s price.
24
US
Treasuries
BBH uses
an evaluated bid supplied by IDC for treasury prices.
25
ANNEX
A
LIST
OF SERIES TRUST(S) ESTABLISHED
BY
THE UNITED STATES COMMODITY INDEX FUNDS TRUST
|
Fund
|
Relevant Schedule
|
|||
|
1.
|
|
United States Commodity Index Fund
|
|
Schedule 1 to this Agreement
|
26
SCHEDULE
1
TO
THE ADMINISTRATIVE AGENCY AGREEMENT
DATED
JULY 22, 2010
DEFINED
TERMS RELATING TO
UNITED
STATES COMMODITY INDEX FUND
Benchmark
Component Futures Contract shall mean the Futures Contracts (as defined
in the Prospectus) that at any given time make up the index of the
Fund.
The Fund
shall mean United States Commodity Index Fund.
27
ANNEX
B
FORM
OF AMENDMENT AGREEMENT TO ADD SERIES TRUST(S) TO
TO
THE ADMINISTRATIVE AGENCY AGREEMENT
This Amendment to the Administrative
Agency Agreement dated ____________ (this “Amendment”), is made and entered into
by and among UNITED STATES
COMMODITY FUNDS LLC, a Delaware limited liability company (the “Sponsor”), the UNITED STATES COMMODITY INDEX FUNDS
TRUST, a Delaware statutory trust (the “Trust”), on its own behalf and
on behalf of the UNITED STATES
COMMODITY INDEX FUND and [INSERT FUND NAME] (each, a
“Fund”), and BROWN BROTHERS HARRIMAN &
CO. (“BBH&Co.” or the “Administrator”) (each, a
“Party” and collectively, “the Parties”).
WHEREAS, the Parties have entered into
a certain Administrative Agency Agreement dated July 22, 2010 (the “Agreement”);
and
WHEREAS, the parties hereto desire to
amend the Agreement as provided herein by amending Annex A of this Agreement and
supplementing this Agreement with the attached Schedule 1 to this
Amendment.
NOW
THEREFORE, for and in consideration of the agreements herein made and other good
and valuable consideration, the parties hereto agree as follows:
I. AMENDMENTS
The
Agreement is hereby amended by making the following change to Annex A
thereto:
LIST
OF SERIES TRUST(S) ESTABLISHED
BY
THE UNITED STATES COMMODITY INDEX FUNDS TRUST
|
Fund
|
Relevant Schedule
|
|||
|
1.
|
United
States Commodity Index Fund
|
Schedule
1 to this Agreement
|
||
|
2.
|
[INSERT
FUND NAME]
|
Schedule
1-A to the Amendment Agreement dated _____________
|
||
|
3.
|
[INSERT
FUND NAME]
|
Schedule
1-B to the Amendment Agreement dated _____________
|
||
|
4.
|
||||
|
5.
|
|
|
The
Parties acknowledge that Schedule 1-__ of this Amendment shall supplement and
not supersede Schedule 1 of the Agreement.
28
II. REPRESENTATIONS
Each
Party represents to the other Parties that:-
(a) Status. It is duly
organized and validly existing under the laws of the jurisdiction of its
organization or incorporation and, if relevant under such laws, in good
standing;
(b) Powers. It has the
power to execute and deliver this Amendment and to perform its obligations
hereunder, and has taken all necessary action to authorize such execution,
delivery and performance;
(c) No Violation or
Conflict. Such execution, delivery and performance do not
violate or conflict with any law applicable to it, any provision of its
constitutional documents, any order or judgment of any court or other agency of
government applicable to it or any of its assets or any contractual restriction
binding on or affecting it or any of its assets;
(d) Consents. All
governmental and other consents that are required to have been obtained by it
with respect to this Amendment have been obtained and are in full force and
effect and all conditions of any such consents have been complied with;
and
(e) Obligations
Binding. Its obligations under this Amendment constitute its
legal, valid and binding obligations, enforceable in accordance with its
respective terms (subject to applicable bankruptcy, reorganization, insolvency,
moratorium or similar laws affecting creditors’ rights generally and subject, as
to enforceability, to equitable principles of general application (regardless of
whether enforcement is sought in a proceeding in equity or at
law)).
III. MISCELLANEOUS
(a) Entire
Agreement. The Amendment constitutes the entire agreement and
understanding of the parties with respect to its subject matter and supersedes
all oral communication and prior writings (except as other wise provided herein)
with respect thereto.
(b) Counterparts. This
Amendment may be executed in multiple counterparts, each of which when executed
and delivered shall be deemed to be an original and all of which taken together
shall constitute but one and the same instrument.
(c) Headings. The
headings used in this Amendment are for convenience of reference only and are
not to affect the construction of or to be taken into consideration in
interpreting this Amendment.
(d) Governing
Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of New York.
(e) Terms. Terms used
in this Amendment, unless otherwise defined herein, shall have the meanings
ascribed to them in the Agreement.
29
(f) Agreement. Any
and all references to the Agreement shall hereafter refer to the Agreement as
amended by this Amendment and as the same may be amended, supplemented or
modified from time to time. Unless otherwise defined herein,
capitalized terms not defined herein shall have the same meanings assigned to
such terms in the Agreement as amended by this Amendment.
Except as
amended hereby, all other terms and conditions of the Agreement shall remain the
same and in full force and effect.
IN
WITNESS WHEREOF, the parties hereto have executed this Amendment effective as of
the date first written above.
|
UNITED
STATES COMMODITY FUNDS LLC
|
||
|
By:
|
|
|
|
Name:
|
||
|
Title:
|
||
UNITED
STATES COMMODITY INDEX FUNDS TRUST, on its own behalf and on behalf of the
United States Commodity Index Fund
| By: | United States Commodity Funds LLC, as Sponsor | |||
|
|
By:
|
|||
|
|
Name:
|
|||
|
|
Title:
|
|||
UNITED
STATES COMMODITY INDEX FUNDS TRUST, on behalf of [INSERT FUND
NAME]
| By: | United States Commodity Funds LLC, as Sponsor | |||
|
|
By:
|
|||
|
|
Name:
|
|||
|
|
Title:
|
|||
BROWN BROTHERS HARRIMAN &
CO.
|
By:
|
|
||
|
Name:
|
|||
|
Title:
|
|||
|
Address:
|
|||
|
Telephone:
|
|||
|
Facsimile:
|
30
SCHEDULE
1
TO
THE AMENDMENT AGREEMENT DATED ____________________
DEFINED
TERMS RELATING TO
[INSERT
NAME OF FUND]
Benchmark
Component Futures Contract shall mean _____________________.
The Fund
shall mean _____________________.
31