HomeMy WebLinkAboutAmerican Stable Value Fund LLC Adoption Agreement -2007 09 05
ADOPTION AGREEMENT
FOR THE
AMERICAN STABLE VALUE FUND LLC
This Adoption Agreement (this "Adoption Agreement") is made and entered into as
of the 5+-"" day of ~k.......l:x.r, 2007, by and between City of Winter Springs General
Employee Retirement System (the "Subscriber"), American Stable Value Fund, LLC, a
Delaware limited liability company (the "Company"), and American Realty Advisors, a
California corporation ("American").
RECITALS
A. The Company has been organized in order to gIve certain Persons,
principally Taft-Hardey Pension Funds, Pension Plans, Governmental Retirement Plans,
corporate pension plans and other qualified trusts, endowments, charitable foundations and
other tax exempt organizations, with a medium for pooling their assets to invest in real
estate, debt instruments and other real estate related investments on a diversified basis.
B. The Subscriber is an eligible investor and the Subscriber desires to acquire
Units in the Company and become a Member thereof pursuant to the Company's Second
Amended and Restated Operating Agreement, dated as of December 8, 2005, including any
amendments thereto heretofore or hereinafter adopted (the "Operating Agreement"). Unless
otherwise defined herein, capitalized terms shall have the meanings ascribed thereto in the
Operating Agreement.
C. The Manager, by its acceptance hereof on behalf of the Company, hereby
consents to the admission of the Subscriber as a Member in the Company.
NOW, THEREFORE, the parties hereby represent, warrant, covenant and agree as
follows:
1. (a) On the terms and subject to the conditions of this Adoption
Agreement and the Operating Agreement, the Subscriber hereby subscribes for the purchase
of Units in the Company for an aggregate Capital Commitment of $1,000,000, with the
number of Units being subscribed for to be computed from time to time in accordance with
the provisions of Section 3.1.1 of the Operating Agreement.
(b) In order to facilitate the acceptance of this Adoption Agreement by
the Company, the Subscriber shall be required to deliver to the Manager:
(1) This duly executed Adoption Agreement;
(2) Evidence satisfactory to the Manager, if requested by the
Manager, that the prospective Member (i) is an organization eligible to be a Member
under the terms of the Operating Agreement (including, without limitation, any
entity that is a Taft-Hardey Pension Fund, a Pension Plan, a Governmental
Retirement Plan, a corporate pension plan or other qualified trust, an endowment,
charitable foundation or other organization exempt from federal income tax), (ii) has
assets in excess of $5,000,000 and (ill) a copy of the determination letter issued by
Internal Revenue Service exempting the Subscriber from federal income taxation:
and
(3) Evidence satisfactory to the Manager, if requested by the
Manager, that the prospective Member is permitted by its organizational documents
or enabling legislation to become a Member in the Company.
(c) If this Adoption Agreement is accepted by the Company, the
Subscriber shall deliver such Capital Contributions as may be requested by the Manager
from time to time and subject to the limitations set forth in Section 3.1 of the Operating
Agreement, to the Manager in the form of wire transfer, cash, by cashier's or certified bank
check or, if assets other than cash are being contributed, by other means acceptable to the
Manager.
(1) Amounts payable hereunder in respect of a Capital
Contribution shall be deposited to the account of, or shall be payable to the order of,
the Company, or otherwise transferred to the Company, as the case may be, when
the Manager shall notify the Subscriber that it has accepted this Adoption
Agreement, or at such other times or in such installments as the Manager may
specify from time to time.
(2) If the Manager has agreed to accept payment of a Capital
Contribution by the contribution of assets other than cash, such assets shall be
described on a schedule and attached hereto and such schedule shall set forth the
Manager's determination of the fair market value thereof and the amount of
liabilities that will be assumed or to which such assets will be subject at the time such
assets are contributed or the method that will be used to determine the amount of
such liabilities.
(d) If a subscription is not accepted or is rejected by the Manager, this
Adoption Agreement and any other subscription documents will be returned to the
Subscriber by the Manager.
2. The Subscriber represents and warrants to and covenants with the Company,
the Manager and other Members that:
(a) The person or persons executing this Adoption Agreement on behalf
of the Subscriber have full power and authority under the provisions of the applicable
instruments and/or legislation governing the Subscriber to execute, deliver and perform this
Adoption Agreement on behalf of Subscriber, and the Adoption Agreement, together with
the Operating Agreement, will constitute valid and binding obligations of the Subscriber in
accordance with the terms thereof.
(b) The Subscriber is exempt from United States income taxation under
applicable provisions of the Internal Revenue Code of 1986, as amended.
(c) The Subscriber is an "accredited investor" as defined in Rule 501
promulgated pursuant to the Securities Act of 1933.
(d) The Subscriber, together with any advisors it may have employed, has
received and reviewed the Operating Agreement, the Offering Memorandum of the
Company (the "Offering Memorandum") and such other documents as the Subscriber
deemed relevant in making a decision to evaluate the merits and risks of an investment in the
Company. Based upon a review of these documents and such other information as the
Subscriber and its advisors have deemed relevant, the Subscriber believes that it possesses
the knowledge and experience in financial and business matters as is required under the
securities laws of the United States of America, including, without limitation, the Securities
Act of 1933, to evaluate the merits and risks of an investment in the Company.
(e) The Subscriber and its advisors have had an opportunity to (i) ask
questions of and receive answers from representatives of the Manager and the Company
concerning the terms and conditions of an investment in the Company, the proposed
operations of the Company and the risks thereof, and (ii) obtain information necessary to
verify the accuracy of the information provided to the Subscriber and its advisors as
specified above.
(f) Any Units in the Company acquired at any time by the Subscriber
will be acquired solely for investment purposes and not with a view to distribution, and the
Subscriber is aware that such interests are not transferable and may not be readily
distributable, if such distribution would adversely affect the Company or the interests of the
other Members.
(g) The Subscriber acknowledges, represents and agrees that the
Company and the Manager seek to comply with all applicable laws concerning money
laundering and similar activities, and, in furtherance of such efforts, the Subscriber hereby
represents and agrees that, to Subscriber's knowledge: (x) none of the cash or property that
is paid or contributed to the Company by the Subscriber shall be derived from, or related to,
any activity that is deemed criminal under applicable law, and (y) no contribution or payment
to the Company by the Subscriber shall (to the extent that such matters are within the
Subscriber's control) cause the Company or the Manager to be in violation of the United
States Bank Secrecy Act, the United States Money Laundering Control Act of 1986 or the
United States International Money Laundering Abatement and Anti-Terrorist Financing Act
of 2001 and (z) the Subscriber is not engaged in money laundering; further, the Subscriber
represents and warrants to the Company and the Manager the following:
(1) to Subscriber's knowledge, no funds tendered for the
acquisition of the Units are directly or indirectly derived from activities that may
contravene applicable laws and regulations, including anti-money laundering laws;
(2) neither the Subscriber, nor any person controlling,
controlled by, or for whom the Subscriber is acting as agent or nominee in
connection with the acquisition of the Units is: (1) a country, territory, organization,
person or entity named on the U.S. Treasury Department's Office of Foreign Assets
Control ("OF AC") list; (2) a person or entity that resides or has a place of business
in a country or territory named on such lists or which is designated as a Non-
Cooperative Jurisdiction by the Financial Action Task Force on Money Laundering
("FA TF"), or whose subscription funds are transferred from or through such a
jurisdiction; (3) a "Foreign Shell Bank" within the meaning of the USA PATRIOT
Act, i.e., a foreign bank that does not have a physical presence in any country and
that is not affiliated with a bank that has a physical presence and an acceptable level
of regulation and supervision; (4) a person or entity that resides in or is organized
under the laws of a jurisdiction designated by the Secretary of the Treasury under
Section 311 or 312 of the USA PATRIOT Act as warranting special measures due to
money laundering concerns or (5) a person or entity who is within the scope of
Executive Order 13224 -"Blocking Property and Prohibiting Transactions with
Persons who Commit, Threaten to Commit, or Support Terrorism, effective
September 24, 2001";
(3) all evidence of identity provided herein in connection with
the Subscriber's acquisition of the Units as contemplated herein is genuine and all
related information furnished is accurate, and the Subscriber hereby agrees to
provide any information deemed reasonably necessary by the Company or the
Manager in its reasonable discretion to comply with its anti-money laundering
responsibilities and policies;
(4) to the extent reporting is required by applicable law, the
Subscriber authorizes and permits the Company and the Manager, and each of them,
each using its own reasonable business judgment, to report information about the
Subscriber to appropriate authorities, and the Subscriber agrees not to hold them
liable for any loss or injury that may occur as the result of providing such
information;
(5) the Subscriber agrees that, notwithstanding any other
statement to the contrary in any agreement into which the Subscriber has entered or
in any prospectus or private placement memorandum of the Company, if the
Company or the Manager determines that the Subscriber has appeared on a list of
known or suspected terrorists or terrorist organizations compiled by any U.S. or
foreign governmental agency, the Company and the Manager, and each of them,
shall be authorized to take any action as shall be necessary or appropriate as a result
thereof, including but not limited to freezing Subscriber's account, removing the
Subscriber as an investor in the Company and/or notifying the federal authorities;
(6) to the extent the Subscriber has any shareholders, partners
or other holders of equity or beneficial interests, the Subscriber has established
procedures to comply with all anti-money laundering laws and regulations; and
(7) if Subscriber is an employee benefit plan, the Company and
Manager acknowledge that Subscriber is not making representations and warranties
in this Section 2(g) with respect to the individual plan participants.
(h) The foregoing representations are true, complete and accurate as of
the date this Adoption Agreement is executed by the Subscriber and the Subscriber
agrees promptly to notify the Company within 15 days in the event that any of the
representations set forth above cease to be true, complete and accurate.
3. The Subscriber and the Manager agree to be bound by the terms of the
Operating Agreement.
4. (a) To the extent Subscriber is subject to ERISA, each of the
undersigned representative(s) of the Subscriber hereby represents and warrants that he/she
is a named fiduciary of Subscriber (within the meaning of Section 402(a) of ERISA), has the
authority to appoint investment managers (within the meaning of Section 3(38) of ERISA)
to the Subscriber, and hereby appoints American as an investment manager in accordance
with Section 402(c)(3) of ERISA, with respect to the assets of the Company that are deemed
to be "plan assets" as provided under ERISA, and acknowledges that under the terms of the
Operating Agreement and the Investment Management Agreement, American shall have
sole and exclusive responsibility for the management, investment and disposition of the
assets of the Company subject only to the rights of the Members pursuant to Section V
thereof. Notwithstanding the foregoing, none of the Manager, American or any of their
respective affiliates, agents or employees has acted or will act as a fiduciary to any such
Subscriber with respect to the Subscriber's decision to invest in the Company.
(b) By executing where indicated below, American hereby accepts its
appointment as an investment manager in accordance with Section 402(c)(3) of ERISA, with
respect to the assets of the Company that are deemed to be "plan assets" as provided under
ERISA, and acknowledges that, under the terms of the Operating Agreement and the
Investment Management Agreement, it is a fiduciary within the meaning of ERISA and that
it shall have sole and exclusive responsibility for the management, investment and
disposition of the assets of the Company subject only to the rights of the Members pursuant
to Section V thereof.
5. The Subscriber shall become a Member in the Company upon delivery of the
first Capital Contribution specified in Paragraph 1 (c)(l) to the extent of the number of Units
purchased thereby and thereupon the Subscriber shall for all purposes be a signatory to the
Operating Agreement. This shall not relieve the Subscriber of its obligation to make any
additional Capital Contributions due under Paragraph 1 (c)(l).
6. The Subscriber acknowledges receipt of a current version of Part II of the
Manager's Form ADV as fued with the United States Securities and Exchange Commission.
If Subscriber did not receive Part II of Manager's Form ADV at least 48 hours prior to
signing this Adoption Agreement, Subscriber may terminate this Adoption Agreement
without penalty within five business days of entering into this Adoption Agreement.
7. All Subscribers acknowledge and agree that certain of them may have
previously been represented by, are presendy represented by, or in the future may be
represented by Mayer, Brown, Rowe & Maw LLP, that Mayer, Brown, Rowe & Maw LLP
does not represent the Company, but currendy represents the Manager, and to the extent
any conflicts of interest exist or arise from such relationships and Mayer, Brown, Rowe &
Maw LLP's representation of, or work performed for, the Manager in connection with the
transactions contemplated hereby, each Subscriber hereby waives any such conflict by
executing this Adoption Agreement.
8. REINVESTMENT OPTION. [Check Applicable Provision]
D Subscriber hereby exercises its Reinvestment Option.
~ Subscriber does not exercise its Reinvestment Option but reserves the right
to do so at a later date by written notice to the Manager
If neither provision is checked, the Subscriber will be deemed to have elected
option #1, to exercise the Reinvestment Option.
9. This Adoption Agreement may be executed in two or more counterparts,
each of which shall be deemed an original and all of which, when taken together, shall
constitute one and the same document. The signature of any party or any counterpart shall
be deemed a signature to, and may be appended to, any other counterpart.
(signature page follows)
IN WITNESS WHEREOF, the parties have executed this Adoption Agreement as
of the date and year first above written.
City of Winter Springs General Employee Retirement System,
By: !(vuU tJ.1ttjt~
Date:
<6- ~l{-o'1
By
Date:
Accepted:
AMERICAN STABLE VALUE FUND, LLC,
a Delaware limited liability company
By: American Realty Advisors,
a Califor corporation
Date:
~--5 --ol
By
Stanley L. Iez n,
President & Chief Executive Officer
Acknowledged and agreed to:
By
Stanley L. Iezman,
President & Chief Executive Officer
Date:
~~/OJ
American
a California 0
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